J. Bersamin Recent 10 Decisions per Subject.docx

POLITICAL LAW ELECTION LAW De Guzman vs. COMELEC G.R. No. 182380, August 28,2009 Doctrines: 1. Release, disbursement or expenditure of public funds. Public works are works designed to subserve some purpose of public necessity, use or convenience, such as public buildings, roads, aqueducts, parks, etc. Since the purchase of the lots is not within the contemplation of the word public works, Sec. 261 (v) of the Omnibus Election Code was not violated. 2. Prohibition against the issuance of treasury warrants. Whether or not the treasury warrant was intended for public works is of no moment. The prohibition is violated in either of two ways: (a) by any person who, within 45 days preceding a regular election and 30 days before a special election, undertakes the construction of any public works except those enumerated in the preceding paragraph; or (b) by any person who issues, uses or avails of treasury warrants or any device undertaking future delivery of money, goods or other things of value chargeable against public funds within 45 days preceding a regular election and 30 days before a special election. Facts: On Mar. 31, 2004, the Sangguniang Panlungsod of Tuguegarao City passed Resolution No. 048-2004 authorizing Mayor Ting to acquire 2 parcels of land for use as public cemetery. Mayor Ting purchased the lands and as payment, City Treasurer Garcia issued Treasury Warrants. Petitioner filed a complaint against Mayor Ting and City Treasurer Garcia, charging them with violation of Sec. 261, para. (v) and (w), of the Omnibus Election Code (OEC), for having undertaken to construct a public cemetery and for having released, disbursed and expended public funds within 45 days prior to the May 9, 2004 election, in disregard of the prohibitions under said provisions due to the election ban period having commenced on Mar. 26, 2004 and ended on May 9, 2004. Issues: 1. Whether the acquisition of lots during the election ban period violates Sec. 261(v) of the OEC 2. Whether the issuance of Treasury Warrant during the election ban period violates Sec. 261(w) of the OEC Ruling/Ratio: 1. No. The acquisition of lots during the period of the election ban is not considered as “public works” in violation of Sec. 261(v) of the OEC. To be liable for violation of Sec. 261(v), these elements must concur: a. A public official or employee releases, disburses, or expends any public funds; b. The release, disbursement or expenditure of such funds must be within forty-five days before regular election; c. The release, disbursement or expenditure of said public funds is for any and all kinds of public works; and d. The release, disbursement or expenditure of the public funds should not cover any exceptions of Section 261 (v). The term public works as used in Sec. 261 (v) is properly construed to refer to any building or structure on land or to structures (such as roads or dams) built by the Government for public use and paid by public funds. Public works are clearly works, whether of construction or adaptation undertaken and carried out by the national, state, or municipal authorities, designed to subserve some purpose of public necessity, use or convenience, such as public buildings, roads, aqueducts, parks, etc.; or, in other words, all fixed works constructed for public use. Since the purchase of the

lots is not within the contemplation of the word public works, the third element is not present. Hence, Sec. 261 (v) of the OEC was not violated. 2. Yes. The issuance of the Treasury Warrant during the period of the election ban violated Sec. 261(w) of the OED. Sec. 261(w) is violated in either of two ways: a.

b.

By any person who, within 45 days preceding a regular election and 30 days before a special election, undertakes the construction of any public works except those enumerated in the preceding paragraph; or By any person who issues, uses or avails of treasury warrants or any device undertaking future delivery of money, goods or other things of value chargeable against public funds within 45 days preceding a regular election and 30 days before a special election.

For purposes of the prohibition, the acts are separate and distinct. Consequently, whether or not the treasury warrant in question was intended for public works was even of no moment in determining if the legal provision was violated. There was probable cause to believe that Sec. 261(w), subparagraph (b) was violated when City Mayor Ting and City Treasurer Garcia issued Treasury Warrant No. 0001534514 during the election ban period. LEGISLATIVE POWER & EQUAL PROTECTION CLAUSE League of Cities vs. COMELEC G.R. Nos. 176951, 177499, 178056, February 15, 2011 Doctrines: 1. The enactment of the Cityhood Laws is an exercise by Congress of its legislative power. Legislative power is the authority, under the Constitution, to make laws, and to alter and repeal them. The Constitution, as the expression of the will of the people in their original, sovereign, and unlimited capacity, has vested this power in the Congress of the Philippines. 2.

The existence of substantial distinction with respect to the municipalities covered by the Cityhood Laws is measured by the purpose of the LG Code. The distinction lies in the capacity and viability of municipalities to become component cities of their respective provinces. Congress, by enacting the Cityhood Laws, recognized this capacity and viability of municipalities to become the State’s partners in accelerating economic growth and development in the provincial regions, which is the very thrust of the LG Code.

Facts: During the 11th Congress, Congress enacted into law 33 bills converting 33 municipalities into cities. However, Congress did not act on bills converting 24 other municipalities into cities. During the 12th Congress, Congress enacted into law, R.A. No. 9009 amending Sec. 450 of the LG Code. This law increased the annual income requirement for conversion of a municipality into a city from P20M to P100M. The amendment was to restrain the mad rush of municipalities converting into cities to secure a larger share in the Internal Revenue Allotment. In the same Congress, the lower house adopted a Joint Resolution which sought to exempt from the P100M income requirement the 24 municipalities whose cityhood bills were not approved in the 11th Congress. However, the 12th Congress ended without the Senate approving the Joint Resolution. During the 13th Congress, the Senate again failed to approve the said Joint Resolution. Thus, following the advice of Sen. Pimentel, 16 municipalities filed through their respective sponsors individual cityhood bills. The 16 cityhood bills contained a common provision which exempted these municipalities from the P100M income requirement in R.A. No. 9009.

The bills lapsed into Cityhood Laws on various dates from March-July 2007. The laws directed COMELEC to hold plebiscites to determine whether the voters in each municipality approved of their conversion to a city. Issues: 1. Whether or not the Cityhood Laws violate Sec. 10, Art. X of the Constitution 2. Whether or not the Cityhood Laws violate the equal protection clause Ruling/Ratio: 1. No, the Cityhood Bills do not violate Sec. 10, Art. X of the Constitution. Before Senate Bill No. 2157, now R.A. No. 9009, was introduced, there were 57 bills filed for conversion of 57 municipalities into cities. During the 11th Congress, 33 of these were enacted into law, while 24 remained pending. Among these 24 were the 16 municipalities that were converted into component cities through the Cityhood Laws. While R.A. No. 9009 was being deliberated upon, Congress was well aware of the pendency of conversion bills of several municipalities, including those covered by the Cityhood Laws, desiring to become component cities which qualified under the P20M income requirement of the old Sec. 450 of the LG Code. In the interpellation, the Congress clearly intended that those with pending Cityhood Bills during the 11th Congress would not be covered by the new and higher income requirement of P100M imposed by R.A. No. 9009. Congress saw the wisdom of exempting respondent municipalities from complying with the higher income requirement imposed by R.A. No. 9009. They have proven themselves viable and capable to become component cities of their respective provinces. They were centers of trade and commerce, points of convergence of transportation, rich havens of agricultural, mineral, and other natural resources, and flourishing tourism spots. The enactment of the Cityhood Laws is an exercise by Congress of its legislative power. Legislative power is the authority, under the Constitution, to make laws, and to alter and repeal them. The Constitution, as the expression of the will of the people in their original, sovereign, and unlimited capacity, has vested this power in the Congress of the Philippines. The LG Code is a creation of Congress through its law-making powers. Congress has the power to alter or modify it as it did when it enacted R.A. No. 9009. Such power of amendment of laws was again exercised when Congress enacted the Cityhood Laws. Since the Cityhood Laws explicitly exempted the concerned municipalities from the amendatory R.A. No. 9009, such Cityhood Laws are, therefore, also amendments to the LG Code itself. 2.

No, the Cityhood Laws do not violate the equal protection clause. The equal protection clause permits a valid classification, provided that it: (1) rests on substantial distinctions; (2) is germane to the purpose of the law; (3) is not limited to existing conditions only; and (4) applies equally to all members of the same class. Petitioners argue that there is no substantial distinction between municipalities with pending cityhood bills in the 11th Congress and municipalities that did not have pending bills, such that the mere pendency of a cityhood bill in the 11th Congress is not a material difference to distinguish one municipality from another for the purpose of the income requirement. The determination of existence of substantial distinction does not simply lie on the mere pendency of their cityhood bills during the 11th Congress. The existence of substantial distinction with respect to respondent municipalities covered by the Cityhood Laws is measured by the purpose of the law, not by R.A. No. 9009, but by the very purpose of the LG Code – the capacity and viability of respondent municipalities to become component cities of their respective provinces. Congress, by enacting the

Cityhood Laws, recognized this capacity and viability of respondent municipalities to become the States partners in accelerating economic growth and development in the provincial regions, which is the very thrust of the LGC, manifested by the pendency of their cityhood bills during the 11 th Congress and their relentless pursuit for cityhood up to the present. Truly, the urgent need to become a component city arose way back in the 11th Congress, and such condition continues to exist. STATE IMMUNITY Air Transportation Office (ATO) vs. Sps. Ramos G.R. No. 159402, February 23, 2011 Doctrine: Immunity is determined by the character of the objects for which the government agency was organized. An agency performing governmental functions is immune from suit while an agency performing proprietary functions is not. ATO is involved in the management and maintenance of the Loakan Airport, an activity that is not the exclusive prerogative of the State in its sovereign capacity. Hence, ATO had no claim to the State’s immunity from suit. Facts: Respondents Sps. Ramos discovered that a portion of their land was being used as part of the runway and running shoulder of the Loakan Airport which is being operated by petitioner ATO. The parties agreed to convey the affected portion by deed of sale to ATO but the latter failed to pay the consideration despite demands. Thus, the respondents filed an action for collection against ATO and some of its officials. ATO asserted that the RTC had no jurisdiction to entertain the action without the State’s consent considering that the deed of sale had been entered into in the performance of governmental functions. Issue: Whether or not ATO is immune from suit Ruling/Ratio: No. The State’s immunity from suit does not extend to ATO because it is an agency of the State engaged in an enterprise that is far from being the State’s exclusive prerogative. ATO is an agency of the Government not performing a purely governmental or sovereign function, but was instead involved in the management and maintenance of the Loakan Airport, an activity that was not the exclusive prerogative of the State in its sovereign capacity. The immunity of the State from suit is expressly provided in Art. XVI of the Constitution. Practical considerations dictate the establishment of an immunity from suit in favor of the State. Otherwise, if the State is suable at the instance of every other individual, government service may be severely obstructed and public safety endangered because of the number of suits that the State has to defend against. Immunity has been upheld in favor of a government agency performing governmental function because its function is governmental or incidental to such function. On the other hand, immunity has not been upheld in favor of one that is performing proprietary functions because such agency’s function was not in pursuit of a necessary function of government but was essentially a business. LAW ON PUBLIC OFFICER Funa vs. Agra G.R. No. 191644, 19 Feb 2013 Doctrine: While all other appointive officials in the civil service are allowed to hold other office in the government during their tenure when such is allowed by law or by the primary functions of their positions, Members of the Cabinet, their deputies and assistants may do so only when expressly authorized by the Constitution. Being designated as the Acting Secretary of Justice concurrently with his position of Acting

Solicitor General, Agra was covered by Sec. 13, Art. VII. Hence, he could not validly hold any other office during his tenure as the Acting Solicitor General, because the Constitution has not otherwise so provided. A de facto officer is one who derives his appointment from one having colorable authority to appoint, if the office is an appointive office, and whose appointment is valid on its face. All official actions of Agra as a de facto Acting Secretary of Justice, assuming that was his later designation, were presumed valid, binding and effective as if he was the officer legally appointed and qualified. Facts: President Arroyo appointed respondent Agra as the Acting Secretary of Justice (SOJ). Days after, President Arroyo designated Agra as the Acting Solicitor General (SolGen) in a concurrent capacity. Petitioner commenced this suit to challenge the constitutionality of Agra’s concurrent appointments, as it is prohibited under Sec. 13, Art. VII of the Constitution. Respondents contend that Agra’s concurrent designations were only in a temporary capacity; that even on the assumption that it constituted "holding of multiple offices," his continued service as the Acting SolGen was akin to a hold-over; that upon Agra’s designation as the Acting SOJ, his term as the Acting SolGen expired in view of the constitutional prohibition against holding of multiple offices; that under the principle of hold-over, Agra continued his service as the Acting SolGen until his successor is elected to prevent a hiatus in the government pending the time when a successor may be chosen into office and that during his continued service, he did not receive any salaries and emoluments from the OSG. Issue: Whether Agra’s concurrent designations violate the constitutional prohibition against dual or multiple offices for the Members of the Cabinet Ruling/Ratio: Yes. While all other appointive officials in the civil service are allowed to hold other office or employment in the government during their tenure when such is allowed by law or by the primary functions of their positions, Members of the Cabinet, their deputies and assistants may do so only when expressly authorized by the Constitution. Sec. 7, Art. IX-B is meant to lay down the general rule applicable to all elective and appointive public officials and employees, while Sec. 13, Art. VII is meant to be the exception applicable only to the President, the Vice-President, Members of the Cabinet, their deputies and assistants. The phrase "unless otherwise provided in this Constitution" must be given a literal interpretation to refer only to those particular instances cited in the Constitution itself. Being designated as the Acting SOJ concurrently with his position of Acting SOJ, Agra was covered by Sec. 13, Art. VII. Hence, Agra could not validly hold any other office or employment during his tenure as the Acting SolGen, because the Constitution has not otherwise so provided. It was of no moment that Agra’s designation was in an acting or temporary capacity. The prohibition against dual or multiple offices being held by one official must be construed as to apply to all appointments or designations, whether permanent or temporary. Agra’s designation as the Acting SOJ was not in an ex officio capacity, by which he would have been validly authorized to concurrently hold the two positions due to the holding of one office being the consequence of holding the other. Nevertheless, Agra was a de facto officer during his tenure as Acting SOJ. A de facto officer is one who derives his appointment from one having colorable authority to appoint, if the office is an appointive office, and whose appointment is valid on its face. All official actions of Agra as a de facto officer were presumed valid, binding and effective.

LAW ON PUBLIC OFFICERS Office of the Ombudsman vs. De Leon G.R. No. 154083, 27 Feb 2013 Doctrine: A public official is guilty of grave misconduct when he neglects to act upon a complaint about a violation of the law he is enforcing. Facts: Acting on a report of illegal quarrying in Baras, Officer Tomilla of the Office of the Ombudsman conducted an investigation. Tornilla filed his report to Ombudsman Desierto confirming the illegal quarrying. Tornilla recommended that a preliminary investigation be conducted agains Mayor Roberto Ferrera, Jonathan Llagas, and Venancio Javier for the probable violation of Sec. 3(e) of R.A. No. 3019 (Anti-Graft and Corrupt Practices Act); and that administrative proceedings for violations of the Civil Service Rules be also undertaken. DILG Resident Ombudsman Falcis II sought the inclusion in the investigation of petitioner De Leon as the Provincial Environment and Natural Resources Officer (PENRO) and as concurrently the Chairman of the Provincial Mining Regulatory Board (PMRB) of Rizal. Issue: Whether or not de Leon is liable for gross neglect of duty Ruling/Ratio: Yes. Gross neglect of duty or gross negligence refers to negligence characterized by the want of even slight care, or by acting or omitting to act in a situation where there is a duty to act, not inadvertently but willfully and intentionally, with a conscious indifference to the consequences, insofar as other persons may be affected. It is the omission of that care that even inattentive and thoughtless men never fail to give to their own property. In cases involving public officials, gross negligence occurs when a breach of duty is flagrant and palpable. Simple neglect of duty means the failure of an official to give proper attention to a task expected of him or her, signifying a disregard of a duty resulting from carelessness or indifference. De Leon, given his rank and level of responsibility, was guilty of gross neglect in not performing the act expected of him. He was assigned to perform tasks in order to achieve the objectives of environmental protection. He chose to be passive despite clear indications of the illegal quarrying activities that had been first brought to his official attention as early as in 1997. The most that he did on the complaint was to dispatch his subordinates to verify the report of quarrying. After the subordinates returned with the information that there were no quarrying activities, he was apparently content with their report. He was not even spurred into further action by the subordinates’ simultaneous report on having observed at the site the presence of earthmoving equipment. Had he been conscientious, the presence of the equipment would have quickly alerted him to the high probability of their being used in quarrying activities. The seriousness of the matter should have prodded him to take further actions, including personally inspecting the site himself either to confirm the findings of the subordinates or to satisfy himself that the earthmoving equipment was not being used for quarrying. The flagrant and culpable refusal or unwillingness of De Leon to perform his official duties denoted gross neglect of duty also because the illegal quarrying had been going for a period of time. His actions were inadequate, and could even be seen as a conscious way to mask a deliberate and intentional refusal to perform the duties that his position required. Making it worse for him was that the quarrying site was a mere stone’s throw away from the main road, being only about 400 meters away from the main road.

ELECTION LAW Tagolino vs. HRET G.R. No. 202202, March 19,2013 Doctrine: A candidate who is disqualified under Sec. 68 of the OEC can be validly substituted because he remains a candidate until disqualified; but a person whose COC has been denied due course to and/or cancelled under Sec. 78 cannot be substituted because he is not considered a candidate. Richard Gomez lacked the 1 year residency requirement under the Constitution, which is one of the grounds under Sec. 78. Hence, he cannot be validly substituted by the private respondent, Lucy Torres-Gomez. Facts: On November 30, 2009, Richard Gomez filed his certificate of candidacy (COC) as Representative for the Fourth District of Leyte. One of the opposing candidates, Buenaventura Juntilla filed a Petition for disqualification and denial/cancellation of COC, alleging that Richard is actually a resident of San Juan City, and not of Ormoc City, thus failing to meet the 1 year residency requirement under Sec. 6, Art. VI of the Constitution. The COMELEC First Division granted the petition without any qualification. It provided that Richard was disqualified to run for the said position but did not explicitly decree the denial and/or cancellation of the COC. On May 5, 2010, respondent Lucy Torres-Gomez filed her COC as a substitute for Richard. The COMELEC En Banc allowed the substitution. In view of the substitution, Richard’s votes were credited in favor of respondent and she was proclaimed the duly-elected Representative. On May 24, 2010, petitioner filed a Petition for quo warranto before the HRET to oust private respondent from her congressional seat, claiming, among others, that she did not validly substitute Richard as his COC was void ab initio. The HRET dismissed the petition observing that the Resolution denying Richard’s candidacy spoke of disqualification and not of COC cancellation hence, the substitution was legal and valid. Issue: Whether .or not the substitution of respondent was valid. Ruling/Ratio: No. The OEC provides for certain remedies to assail a candidate’s bid for public office. Among these are: 1. A petition for disqualification under Sec. 68; and 2. A petition to deny due course to and/or cancel a certificate of candidacy under Sec. 78. A disqualification case under Sec. 68 is hinged on either: (a) a candidate’s possession of a permanent resident status in a foreign country; or (b) his or her commission of certain acts of disqualification. One who is disqualified under Sec. 68 is still technically considered to have been a candidate, albeit proscribed to continue as such only because of supervening infractions which do not, however, deny his or her statutory eligibility. A denial in due course to and/or cancellation of a COC under Sec. 78 is premised on a person’s misrepresentation of any of the material qualifications required for the elective office (age, residence, citizenship or non-possession of natural-born Filipino status). If the candidate subsequently states a material representation in the COC that is false, the COMELEC is empowered to deny due course to or cancel such certificate. A person whose COC had been denied due course to and/or cancelled under Sec. 78 is deemed to have not been a candidate at all. The reason being is that a cancelled COC is considered void ab initio and thus, cannot give rise to a valid candidacy and necessarily, to valid votes. Richard was disqualified to run due to his failure to comply with the 1 year residency requirement. The confusion, however, stemmed from the use of the word “disqualified” in the Resolution of the COMELEC First Division, which was adopted by the COMELEC En Banc in granting the substitution, and even further perpetuated by the HRET in denying the quo warranto petition. The fact that the COMELEC First Division’s Resolution did not explicitly decree the denial of due course to and/or cancellation of Richard’s

COC should not have obviated the COMELEC En Banc from declaring the invalidity of private respondent’s substitution. The clear and unequivocal basis for Richard’s “disqualification” is his failure to comply with the residency requirement under Sec. 6, Art. VI of the Constitution which is a ground for the denial of due course to and/or cancellation a COC under Sec. 78 of the OEC, not for disqualification. Owing to the lack of proper substitution, private respondent was therefore not a bona fide candidate for the position of Representative for the Fourth District of Leyte when she ran for office, which means that she could not have been elected. LOCAL GOVERNMENTS Legaspi vs. City of Cebu G.R. Nos. 159110 and 159692, December 10, 2013 Doctrines: 1. The goal of the decentralization of powers to the LGUs is to ensure the enjoyment by each of the territorial and political subdivisions of the State of a genuine and meaningful local autonomy. The Local Government Code (LGC) has expressly empowered the LGUs to enact and adopt ordinances to regulate vehicular traffic and to prohibit illegal parking within their jurisdictions. 2.

The clamping of the petitioners’ vehicles pursuant to Ordinance No. 1664 is one of the exceptions of notice and hearing. The immobilization of illegally parked vehicles by clamping the tires was necessary because the transgressors were not around at the time of apprehension. Notice and hearing would be superfluous. Nor should the lack of a trial-type hearing prior to the clamping constitute a breach, for giving the transgressors the chance to reverse the apprehensions through a timely protest could equally satisfy the need for a hearing.

Facts: The Sangguniang Panlungsod of Cebu City enacted Ordinance No. 1664 authorizing traffic enforcers to immobilize any motor vehicle violating the parking restrictions and prohibitions in order to have a smooth flow of vehicular traffic. Petitioners contend that the Ordinance, by leaving the confiscation and immobilization of the motor vehicles to the traffic enforcers or the PNP instead of to officials exercising judicial authority, was violative of the constitutional guaranty of due process and that such confiscation and immobilization should only be made after a hearing on the merits by courts because the immobilization and the clamping of the cars and motor vehicles by the police or traffic enforcers could be subject to abuse. Petitioners further assert that drivers or vehicle owners affected were not accorded the opportunity to protest the clamping, towing, and impounding of the vehicles, or even to be heard and to explain their side prior to the immobilization of their vehicles; and that the ordinance was oppressive and arbitrary for that reason. Issue: Whether or not the Ordinance No. 1664 is valid Ruling/Ratio: Yes. The tests of a valid ordinance are the following: 1. Formal: it was enacted within the corporate powers of the LGU and passed in accordance with the procedure prescribed by law. Congress enacted the LGC as the implementing law for the delegation to the various LGUs of the State’s great powers. Police power cannot be exercised by any group or body of individuals not possessing legislative power. The Legislature, however, may delegate this power to the lawmaking bodies of LGUs. Once delegated, the agents can exercise only such legislative powers as are conferred on them by the national lawmaking body. Vesting cities with the legislative power to enact traffic rules and regulations was expressly done through Sec. 458 of the LGC, and also generally by virtue of the General Welfare

Clause embodied in Sec. 16 of the LGC. LGUs would be in the best position to craft their traffic codes because of their familiarity with the conditions peculiar to their communities. 2. Substantive: (a) It must not contravene the Constitution or any statute; (b) It must not be unfair or oppressive; (c) It must not be partial or discriminatory. (d) It must not prohibit but may regulate; (e) It must be general and consistent with public policy; and (f) It must not be unreasonable. Considering that traffic congestions were already retarding the growth and progress in the population and economic centers of the country, the plain objective of Ordinance No. 1664 was to serve the public interest and advance the general welfare in the City. Ordinance No. 1664 was far from oppressive and arbitrary. Any driver or vehicle owner whose vehicle was immobilized by clamping could protest such action of a traffic enforcer or PNP personnel enforcing the ordinance as provided under Sec. 3 of the Ordinance. Notice and hearing are the essential requirements of procedural due process. Yet, there are many instances in which the absence of one or both of such requirements is not necessarily a denial or deprivation of due process. The clamping of the vehicles was of the same character as the established exceptions dispensing with notice and hearing. The immobilization of illegally parked vehicles by clamping the tires was necessary because the transgressors were not around at the time of apprehension. Under such circumstance, notice and hearing would be superfluous. Nor should the lack of a trial-type hearing prior to the clamping constitute a breach of procedural due process, for giving the transgressors the chance to reverse the apprehensions through a timely protest could equally satisfy the need for a hearing. The prior intervention of a court was not indispensable to ensure a compliance with due process. BILL OF RIGHTS People vs. Sandiganbayan (First and Third Division) G.R. Nos. 188165 and 189063, December 11, 2013 Doctrine: The right to a speedy disposition of cases is not limited to the accused in criminal proceedings but extends to all parties in all cases, including civil and administrative cases, and in all proceedings, including judicial and quasi-judicial hearings. At no time should the progress and success of the preliminary investigation of a criminal case be made dependent upon the ratification of a treaty by the Senate that would provide to the prosecutorial arm of the State, already powerful and overwhelming in terms of its resources, an undue advantage unavailable at the time of the investigation. To allow the delay under those terms would definitely violate fair play and nullify due process of law. Facts: The acts of the accused had supposedly occurred in the period from Feb. 13-23, 2001. Yet, the criminal complaint came to be initiated only on Nov. 25, 2002 when Ombudsman Marcelo requested the PAGC to provide his office with the documents relevant to the exposé of Cong. Villarama. Cong. Jimenez delivered a speech confirming Cong. Villarama’s exposé and accusing Secretary Perez of extorting $2 Million from him in 2001. Subsequently, on Dec. 23, 2002, Cong. Jimenez submitted his complaint-affidavit to the Office of the Ombudsman. It was only on Nov. 6, 2006, however, when the Special Panel issued the Joint Resolution recommending that the criminal informations be filed against the accused. Ombudsman Gutierrez approved the Joint Resolution only on Jan. 5, 2007. Ultimately, the informations charging the accused with 4 different crimes were filed on Apr. 15, 2008. In sum, the fact-finding investigation and preliminary investigation by the Office of the Ombudsman lasted nearly 5 years and 5 months. Issue: Whether or not the accused’s constitutional right to the speedy disposition of cases was violated

Ruling/Ratio: Yes. The right to the speedy disposition of cases is enshrined in Art. III, Sec. 16 of the Constitution. Such right is not limited to the accused in criminal proceedings but extends to all parties in all cases, including civil and administrative cases, and in all proceedings, including judicial and quasi-judicial hearings. The right to the speedy disposition of a case is deemed violated when the proceedings are attended by vexatious, capricious, and oppressive delays; or when unjustified postponements of the trial are asked for and secured; or when without cause or justifiable motive a long period of time is allowed to elapse without the party having his case tried. The Office of the Ombudsman had taken an unusually long period of time just to investigate the criminal complaint and to determine whether to criminally charge the accused. Such long delay was inordinate and oppressive, and constituted under the peculiar circumstances of the case an outright violation of the accused’s right to the speedy disposition of their cases. It is incumbent for the State to prove that the delay was reasonable, or that the delay was not attributable to it. In both regards, the State miserably failed. For one, the State explains that the criminal cases could not be immediately filed in court primarily because of the insufficiency of the evidence to establish probable cause, like not having a document showing that the funds had reached Secretary Perez and that to enable it to obtain the document and other evidence, it needed to await the ratification of the treaties RP-HKSAR Agreement, and the RP-Swiss MLAT. The State’s dependence on the ratification of the two treaties was not a sufficient justification for the delay. To allow the delay under those terms would definitely violate fair play and nullify due process of law. There was really no sufficient justification tendered by the State for the long delay of more than five years. For such a simple charge of Robbery there is nothing more to consider and all the facts and circumstances upon which to anchor a resolution whether to give due course to the complaint or dismiss it are on hand. Failure to act on the same is a clear transgression of the constitutional rights of the accused. DUE PROCESS & DISQUALIFICATION AND INHIBITION OF JUDGES Lai vs. People G.R. No. 175999, 1 Jul 2015 Doctrine: 1. An essential part of the right is to be afforded a just and fair trial before an accused’s conviction for any crime. 2.

The trial judge who participated as a public prosecutor in the same criminal case should be disqualified. That Judge Elumba’s prior participation as the public prosecutor was passive, or that he entered his appearance as the public prosecutor long after the Prosecution had rested its case against the petitioner did not really matter. The purpose of this stricture is to ensure that the proceedings in court that would affect the life, liberty and property of the petitioner as the accused should be conducted and determined by a judge who was wholly free, disinterested, impartial and independent.

Facts: This case involves the shooting of Enrico Villanueva, Jr. by the petitioner Nelson Lai. On August 21, 2001, RTC Judge Elumba found petitioner guilty of Homicide. Judge Elumba had been assigned on March 23, 1998 as the public prosecutor in Br. 42 of the RTC in Negros Occidental, and became the Presiding Judge of Br. 42 on April 27, 2000. Br. 42 was the trial court hearing and ultimately deciding the Criminal Case against the petitioner. The Court of Appeals ruled in favor of Judge Elumba contending that when the judge, who was then a public prosecutor, entered his appearance, the prosecution had already long rested its case. He appeared only when the last witness for the defense was presented, not to mention the fact that it was a private prosecutor who cross-examined the witness.

Issue: Whether or not the non-disqualification of Judge Elumba prejudiced the petitioner’s right to due process Ruling/Ratio: Yes. An essential part of the right is to be afforded a just and fair trial before his conviction for any crime. The cold neutrality of an impartial judge is the indispensable imperative of due process. The judge must not only be impartial but must also appear to be impartial as an added assurance to the parties that his decision will be just. Without such confidence, there would be no point in invoking his action for the justice they expect. The mere appearance of his name as the public prosecutor in the records of the Criminal Case sufficed to disqualify Judge Elumba from deciding the case. Having represented the State in the prosecution of the petitioner, he could not sincerely claim neutrality or impartiality as the trial judge who would continue to hear the case. That Judge Elumba’s prior participation as the public prosecutor was passive, or that he entered his appearance as the public prosecutor long after the Prosecution had rested its case against the petitioner did not really matter. The evil sought to be prevented by the rules on disqualification had no relation whatsoever with the judge’s degree of participation in the case before becoming the judge. Under the circumstances, Judge Elumba could not be expected to render impartial, independent and objective judgment on the criminal case of the petitioner. Hence, his non-disqualification resulted in the denial of the petitioner’s right to due process. RIGHT TO BAIL Enrile vs. Sandiganbayan (Third Division) G.R. No. 213847, August 18, 2015 Doctrine: The decision whether to detain or release an accused before and during trial is ultimately an incident of the judicial power to hear and determine his criminal case. The strength of the Prosecution's case, albeit a good measure of the accused’s propensity for flight or for causing harm to the public, is subsidiary to the primary objective of bail, which is to ensure that the accused appears at trial. Enrile’s advanced age and ill health justifies his admission to bail. Granting provisional liberty to Enrile will enable him to have his medical condition be properly addressed and better attended to by competent physicians in the hospitals of his choice. This will not only aid in his adequate preparation of his defense but, more importantly, will guarantee his appearance in court for the trial. Facts: The Office of the Ombudsman charged petitioner Enrile with plunder on the basis of their involvement in the diversion and misuse of PDAF. Petitioner filed his Omnibus Motion and Supplemental Opposition, praying that he be allowed to post bail should probable cause be found against him. Sandiganbayan denied his bail, on the ground of its prematurity considering that Enrile had not yet then voluntarily surrendered or been placed under the custody of the law. Accordingly, the Sandiganbayan ordered his arrest. Enrile voluntarily surrendered and was later on confined at the PNP General Hospital. Thereafter, Enrile filed his Motion to Fix Bail arguing that he should be allowed to post bail because: (a) the Prosecution had not yet established that the evidence of his guilt was strong; (b) although he was charged with plunder, the penalty as to him would only be reclusion temporal, not reclusion perpetua, since he is over 70 years old and he voluntarily surrendered; and (c) he was not a flight risk, and his age and physical condition must further be seriously considered. Sandiganbayan denied Enrile’s Motion, arguing that it is only after the prosecution shall have presented its evidence and the Court shall have made a determination that the evidence of guilt is not strong against accused Enrile can he demand bail as a matter of right.

Issue: Whether or not the petitioner is entitled to bail Ruling/Ratio: Yes. The right to bail is expressly afforded by Sec. 13, Art. III of the Constitution. This constitutional provision is repeated in Sec. 7, Rule 114 of the Rules of Court: No person charged with a capital offense, or an offense punishable by reclusion perpetua or life imprisonment, shall be admitted to bail when evidence of guilt is strong, regardless of the stage of the criminal prosecution. The general rule is that any person, before being convicted of any criminal offense, shall be bailable, unless he is charged with a capital offense, or with an offense punishable with reclusion perpetua or life imprisonment, and the evidence of his guilt is strong. For purposes of admission to bail, the determination of whether evidence of guilt is strong in criminal cases involving capital offenses, or offenses punishable with reclusion perpetua or life imprisonment lies within the discretion of the trial court. But such discretion may be exercised only after the hearing called to ascertain the degree of guilt of the accused for the purpose of whether or not he should be granted provisional liberty. In resolving bail applications of the accused who is charged with a capital offense, or an offense punishable by reclusion perpetua or life imprisonment, the trial judge is expected to comply with the guidelines outlined in Cortes v. Catral, to wit: 1. In all cases, notify the prosecutor of the hearing of the application for bail or require him to submit his recommendation (Sec. 18, Rule 114 of the ROC); 2. Where bail is a matter of discretion, conduct a hearing of the application for bail regardless of whether or not the prosecution refuses to present evidence to show that the guilt of the accused is strong for the purpose of enabling the court to exercise its sound discretion; (Secs. 7 and 8, supra) 3. Decide whether the guilt of the accused is strong based on the summary of evidence of the prosecution; 4. If the guilt of the accused is not strong, discharge the accused upon the approval of the bailbond (Sec. 19, supra) Otherwise petition should be denied. Petitioner’s social and political standing and his having immediately surrendered to the authorities upon his being charged in court indicate that the risk of his flight or escape from this jurisdiction is highly unlikely. His personal disposition from the onset of his indictment for plunder has demonstrated his utter respect for the legal processes. With his solid reputation in both his public and his private lives, his long years of public service, and history’s judgment of him being at stake, he should be granted bail. The currently fragile state of Enrile’s health presents another compelling justification for his admission to bail. The Director of the PGH attested that his medical conditions, singly or collectively, could pose significant risks to the life of Enrile. Granting provisional liberty to Enrile will then enable him to have his medical condition be properly addressed and better attended to by competent physicians in the hospitals of his choice. This will not only aid in his adequate preparation of his defense but, more importantly, will guarantee his appearance in court for the trial. Sandiganbayan arbitrarily ignored the objective of bail to ensure the appearance of the accused during the trial; and unwarrantedly disregarded the clear showing of the fragile health and advanced age of Enrile. As such, the Sandiganbayan gravely abused its discretion in denying Enrile’s Motion To Fix Bail.

OFFICE OF THE OMBUDSMAN Soriano vs. Deputy Ombudsman Fernandez G.R. No. 168157, August 19,2015 Doctrine: The discretion of the Office of the Ombudsman in the determination of probable cause to charge a respondent public official or employee cannot be interfered with in the absence of a clear showing of grave abuse of discretion amounting to lack or excess of jurisdiction. Facts: Atty. Cleofe, the Acting Registrar of Deeds of Batangas, was charged with violation of Sec. 3(e) of R.A. No. 3109 (Anti-Graft and Corrupt Practices Act). Petitioner, as president of Soriano Holdings Corporation (SHC), alleged that Atty. Cleofe had given one Teresa Robles an unwarranted advantage by illegally canceling his Transfer Certificate of Title (TCT) and then issuing a new owner’s TCT without the payment of proper taxes and fees. Petitioner insisted that the Deed of Sale between the Sps. Santos and Robles was void because the parcel of land had already been sold/assigned to SHC and that SHC still held the owner's copy of TCT. The Office of the Deputy Ombudsman dismissed the charge for lack of probable cause. The record is bereft of any evidence to prove that Atty. Cleofe was actuated with malice and/or bad faith when he issued a new title in the name of Robles. Neither was there evidence to show that Atty. Cleofe had gained pecuniary benefit from such act. Also, Atty. Cleofe, in issuing the new title, even without the payment of taxes, is guided by the Order previously issued by the LRA in a similar case. Issue: Whether or not the Office of the Deputy Ombudsman gravely abused its discretion amounting to lack or excess of jurisdiction Ruling/Ratio: No. The exclusive discretion to determine the existence of probable cause to charge a public official in a criminal case pertained to the Office of the Ombudsman. Such office is vested with the sole power to investigate and prosecute, motu proprio or on complaint of any person, any act or omission of any public officer or employee, office, or agency when such act or omission appears to be illegal, unjust, improper, or inefficient. The Ombudsman's power to investigate and to prosecute is plenary and unqualified. It has the discretion to determine whether a criminal case, given its attendant facts and circumstances, should be filed or not. However, this Court is not precluded from reviewing the Ombudsman's action when there is grave abuse of discretion, in which case the certiorari jurisdiction of the Court may be exceptionally invoked pursuant to Sec. 1, Art. VIII of the Constitution. In the following instances, the courts may interfere with the Ombudsman's investigatory powers: 1. To afford protection to the constitutional rights of the accused; 2. When necessary for the orderly administration of justice or to avoid oppression or multiplicity of actions; 3. When there is a prejudicial question which is sub judice; 4. When the acts of the officer are without or in excess of authority; 5. Where the prosecution is under an invalid law, ordinance or regulation; 6. When double jeopardy is clearly apparent; 7. Where the court has no jurisdiction over the offense; 8. Where it is a case of persecution rather than prosecution; 9. Where the charges are manifestly false and motivated by the lust for vengeance. None of the exceptions was present herein. To justify the issuance of the writ of certiorari, the petitioner must show that the Office of the Ombudsman gravely abused its discretion amounting to lack or excess of jurisdiction, which connotes the whimsical and capricious exercise of judgment. The abuse must be so patent and gross as to amount to an evasion of a positive duty or to a virtual refusal to perform a duty

enjoined by law, or to act at all in contemplation of law as where the power is exercised in an arbitrary and despotic manner by reason of passion or hostility. Obviously, the Office of the Ombudsman, having correctly resolved the question of probable cause, did not abuse their discretion, least of all gravely, in dismissing the charge against Atty. Cleofe. RIGHT TO INFORMATION Sereno vs. Committee on Trade and Related Matters of NEDA G.R. No. 175210, February 1, 2016 Doctrine: The constitutional guarantee to information does not open every door to any and all information, but is rather confined to matters of public concern. It is subject to such limitations as may be provided by law. The State's policy of full public disclosure is restricted to transactions involving public interest, and is tempered by reasonable conditions prescribed by law. Facts: On May 23, 2005, respondent Committee on Tariff and Related Matters (CTRM), an office under the NEDA, resolved to recommend to President Arroyo the lifting of the suspension of the tariff reduction schedule on petrochemicals and certain plastic products under the ASEAN AFTA-CEPT Scheme. President Macapagal-Arroyo signed E.O. No. 486 adopting the said recommendation. Petitioner filed a petition for mandamus to compel CTRM to provide him a copy of the minutes of its May 23, 2005 meeting as well as copies of all official records, documents, papers and government research data used as basis for the issuance of E.O. No. 486. The request for information was motivated by his desire to understand the basis for the recommendation that allegedly caused tremendous losses to the petrochemical industry claiming that the implementation of E.O. No. 486 effectively deprived the industry of tariff support and market share, jeopardizing large investments without due process of law. Issue: Whether or not the CTRM may be compelled by mandamus to furnish the petitioner with a copy of the minutes based on the constitutional right to information on matters of public concern and the State's policy of full public disclosure Ruling/Ratio: No. The constitutional guarantee of the right to information on matters of public concern enunciated in Sec. 7 of Art. III of the Constitution complements the State's policy of full public disclosure in all transactions involving public interest expressed in Sec. 28 of Art. II of the Constitution. These are aimed at ensuring transparency in policy-making as well as in the operations of the Government, and at safeguarding the exercise by the people of the freedom of expression. Two requisites must concur before the right to information may be compelled by mandamus: 1. The information must be in relation to matters of public concern or public interest. 2. It must not be exempt by law from the operation of the constitutional guarantee. As to the first requisite, the Philippine petrochemical industry centers on the manufacture of plastic and other related materials, and provides essential input requirements for the agricultural and industrial sectors of the country. Thus, the position of the petrochemical industry as an essential contributor to the overall growth of our country's economy easily makes the information sought a matter of public concern or interest. As to the second requisite, the following are declared to be excluded by law: 1. National security matters and intelligence information, trade secrets and banking transactions and criminal matters 2. Diplomatic correspondence, closed-door Cabinet meeting and executive sessions of either house of Congress 3. Internal deliberations of the Supreme Court

4. Matters acknowledged as "privileged information under the separation of powers," which include "Presidential conversations, correspondences, or discussions during closed-door Cabinet meetings." 5. Information on military and diplomatic secrets, information affecting national security, and information on investigations of crimes by law enforcement agencies before the prosecution of the accused The May 23, 2005 meeting was classified as a closed-door Cabinet meeting by virtue of the committee's composition and the nature of its mandate dealing with matters of foreign affairs, trade and policy-making. The information withheld was within the scope of the exemption from disclosure because the CTRM meetings were directly related to the exercise of the sovereign prerogative of the President as the Head of State in the conduct of foreign affairs and the regulation of trade. It is always necessary, given the highly important and complex powers to fix tariff rates vested in the President, that the recommendations submitted for the President's consideration be well-thought out and well-deliberated.

LABOR LAW TRANSFER AS CONSTRUCTIVE DISMISSAL CHATEAU ROYALE SPORTS AND COUNTRY CLUB, INC. vs RACHELLE G. BALBA and MARINEL N. CONSTANTE G.R. No. 197492, January 16, 2017 Doctrine: In the resolution of whether the transfer of the respondents, we have to weigh and consider, on the one hand, that management has a wide discretion to regulate all aspects of employment, including the transfer and re-assignment of employees according to the exigencies of the business; and, on the other, that the transfer constitutes constructive dismissal when it is unreasonable, inconvenient or prejudicial to the employee, or involves a demotion in rank or diminution of salaries, benefits and other privileges, or when the acts of discrimination, insensibility or disdain on the part of the employer become unbearable for the employee, forcing him to forego her employment. Facts: Petitioner, a domestic corporation operating a resort complex in Nasugbu, Batangas, hired the respondents as Account Executives on probationary status. Later, the respondents were promoted to Account Managers. As part of their duties as Account Managers, they were instructed by the Director of Sales and Marketing to forward all proposals, event orders and contracts for an orderly and systematic bookings in the operation of the petitioner’s business. However, they failed to comply with the directive. Accordingly, a notice to explain was served on them, to which they promptly responded. A notice of administrative hearing were served to the respondents. Thereupon, respondents sent a letter asking for the postponement of the hearing which was denied by the management and at the same time informed them that the petitioner’s Corporate Infractions Committee had found them to have committed acts of insubordination, and they were suspended for seven days. The suspension order was lifted even before its implementation. Later, respondents filed a complaint for illegal suspension, non-payment of allowances and commissions, and constructive dismissal. It has come to the respondents’ knowledge that the management has a plan to transfer them to Manila Office. The proposed transfer was prompted by the shortage of personnel at the Manila Office as a result of the resignation of three account managers and the director of sales and marketing. Despite the attempts to convince them to accept the transfer to Manila, they declined because their families were living in Nasugbu, Batangas. Issue: Whether or not the respondents were constructively dismissed Ruling/Ratio: No. In the resolution of whether the transfer of the respondents, we have to weigh and consider, on the one hand, that management has a wide discretion to regulate all aspects of employment, including the transfer and re-assignment of employees according to the exigencies of the business; and, on the other, that the transfer constitutes constructive dismissal when it is unreasonable, inconvenient or prejudicial to the employee, or involves a demotion in rank or diminution of salaries, benefits and other privileges, or when the acts of discrimination, insensibility or disdain on the part of the employer become unbearable for the employee, forcing him to forego her employment. In this case, the Court is satisfied that there had been a valid exercise of management prerogative. First, the management had the prerogative to determine the place where the employee is best qualified to serve the interests of the business given the qualifications, training and performance of the affected employee. Second, the transfer is not unreasonable nor oppressive, the transfer would be without demotion in rank, or without diminution of benefits and salaries. Third, respondents did not show

substantial evidence that the petitioner was acting in bad faith or had ill-motive in ordering the transfer. Lastly, the respondents, by having voluntarily affixed their signatures on their respective letters of appointment, acceded to the terms and conditions therein, including the prerogative of the management to transfer and re-assign its employees from one job to another “as it may deem necessary or desirable” . REMEDIES SUGARSTEEL INDUSTRIAL INC. AND MR. BEN YAPJOCO VS. VICTOR ALBINA, VICENTE UY AND ALEX VELASQUEZ G.R. No. 168749, June 6, 2016 Doctrine: The CA may review and disregard the factual findings of the NLRC upon a clear showing of its capricious, whimsical or arbitrary disregard of the evidence or of circumstances of considerable importance crucial or decisive of the controversy. In such eventuality, the writ of certiorari should issue, and the CA enjoys the leeway to make its own independent evaluation of the evidence of the parties as well as to ascertain whether or not substantial evidence supported the NLRC's ruling. Facts: A clog-up occurred at the kettle sheet guide. At that time, the petitioners were on duty working in their assigned areas. As a consequence, twenty (20) GI sheets were clogged-up inside the kettle, causing damage to the private respondent. On the same day, a memorandum was issued by Mr. Ben S. Yapjoco, manager of the private respondent, requiring all the petitioners to submit written explanation on the aforesaid incident and why no action shall be taken against them for gross negligence. Individual notices of suspension were sent to the petitioners pending final decision relative to the incident. On August 29, 1996, Mr. Yapjoco again sent individual notices of termination of employment to all petitioners, stating that after the management conducted an investigation on the circumstances surrounding the incident, the petitioners were found guilty of gross neglect of duty and by reason thereof they were terminated from their employment. Respondents Victor Albina, Vicente Uy and Alex Velasquez charged the petitioners in the Regional Arbitration Branch of the National Labor Relations Commission (NLRC) in Cebu City with having illegally dismissed them as kettleman, assistant kettleman, and inspector, respectively. Labor Arbiter (LA) ruled that although the dismissal of the respondents was justified because of their being guilty of gross negligence, the petitioners should pay them their separation pay at the rate of 1/2 month per year of service. NLRC denied the respondents' motion for reconsideration. CA granted the petition for certiorari. Issue: Did the CA depart from well-settled rules on what findings the CA could review on certiorari? Ruling/Ratio: No. The policy of practicing comity towards the factual findings of the labor tribunals does not preclude the CA from reviewing the findings, and from disregarding the findings upon a clear showing of the NLRC's capricious, whimsical or arbitrary disregard of the evidence or of circumstances of considerable importance crucial or decisive of the controversy. In such eventuality, the writ of certiorari should issue, and the CA, being also a court of equity, then enjoys the leeway to make its own independent evaluation of the evidence of the parties as well as to ascertain whether or not substantial evidence supported the NLRC's ruling. NLRC affirmed the decision of the LA based on its observation that the alleged ground for the respondents' appeal -that "the decision with all due respect, is not supported by evidence and is contrary to the facts obtaining" -was not one of those expressly enumerated under Article 223 of the Labor Code. CA acted judiciously in undoing the too literal interpretation of Article 223 of the Labor Code by the NLRC.. Their phrasing of the ground, albeit not hewing closely (or literally) to that of Article 223, related to the first and the last grounds under the provision. In dismissing the appeal on that basis, the NLRC seemed to prefer form and technicality to substance and justice. Thereby, the NLRC acted arbitrarily, for

its dismissal of the appeal became entirely inconsistent with the constitutional mandate for the protection to labor. CA's overturning of the NLRC's ruling was based on its finding that the petitioners did not sufficiently establish the just and valid cause to dismiss the respondents from their employment. The CA thereby enforced against the petitioners the respected proposition that it was the employer who bore the burden to show that the dismissal was for just and valid cause. The failure of the petitioners to discharge their burden of proof as the employers necessarily meant that the dismissal was illegal. The outcome could not be any other way. In order to warrant the dismissal of the employee for just cause, Article 282 (b) of the Labor Code requires the negligence to be gross and habitual. Gross negligence is the want of even slight care, acting or omitting to act in a situation where there is duty to act, not inadvertently but willfully and intentionally, with a conscious indifference to consequences insofar as other persons may be affected. Habitual neglect connotes repeated failure to perform one's duties for a period of time, depending upon the circumstances. Obviously, a single or isolated act of negligence does not constitute a just cause for the dismissal of the employee. Considering, however, that the petitioners did not refute the respondents' claim that the incident was their first offense, and that the petitioners did not present any evidence to establish the supposed habitual neglect on the part of the respondents, like employment or other records indicative of the service and personnel histories of the respondents during the period of their employment, the CA reasonably found and concluded that the just cause to dismiss them was not established by substantial evidence. REMEDIES ROBINA FARMS CEBU VS. ELIZABETH VILLA G.R. No. 175869, April 18, 2016 Doctrine: The requirement under Section 4(a), Rule VI of the Amended NLRC Rules of Procedure that an appeal should be verified by the appellant herself is a mere formal requirement intended to secure and to give assurance that the matters alleged in the pleading are true and correct. The requirement is complied with when one who has the ample knowledge to swear to the truth of the allegations in the complaint or petition signs the verification, or when the matters contained in the petition have been alleged in good faith or are true and correct. Being a mere formal requirement, the courts may even simply order the correction of improperly verified pleadings, or act on the same upon waiving the strict compliance with the rules of procedure. Facts: Respondent Elizabeth Villa brought against the petitioner her complaint for illegal suspension, illegal dismissal, nonpayment of overtime pay, and nonpayment of service incentive leave pay in the Regional Arbitration Branch No. VII of the NLRC in Cebu City. Villa averred that she had been employed •by petitioner Robina Farms as sales clerk since August 1981; that in the later part of 2001, the petitioner had enticed her to avail herself of the company's special retirement program; that on March 2, 2002, she had received a memorandum from Lily Ngochua requiring her to explain her failure to issue invoices for unhatched eggs in the months of January to February 2002; that she had explained that the invoices were not delivered on time because the delivery receipts were delayed and overlooked; that despite her explanation, she had been suspended for 10 days from March 8, 2002 until March 19, 2002; that upon reporting back to work, she had been advised to cease working because her application for retirement had already been approved; that she had been subsequently informed that her application had been disapproved, and had then been advised to tender her resignation with a request for financial assistance; that she had manifested her intention to return to work but the petitioner had confiscated her gate pass; and that she had since then been prevented from entering the company premises and had been replaced by another employee. Labor Arbiter found that Villa had not been dismissed from employment. NLRC dismissed the appeal of the petitioner but granted that of Villa. The CA treated the petitioner's appeal as an unsigned pleading because the petitioner did not present proof showing that Florabeth P. Zanoria, its Administrative Officer and Chief Accountant who had signed the verification, had been authorized to sign and file the appeal.

Issue/s: 1. Whether or not Villa's appeal should be treated as an unsigned pleading because she had accompanied her appeal with the same verification attached to her position paper. 2. Whether or not petitioner did not admit Villa back to work. Ruling/Ratio: 1. No. Section 4(a), Rule VI of the Amended NLRC Rules of Procedure requires an appeal to be verified by the appellant herself. The verification is a mere formal requirement intended to secure and to give assurance that the matters alleged in the pleading are true and correct. The requirement is complied with when one who has the ample knowledge to swear to the truth of the allegations in the complaint or petition signs the verification, or when the matters contained in the petition have been alleged in good faith or are true and correct. Being a mere formal requirement, the courts may even simply order the correction of improperly verified pleadings, or act on the same upon waiving the strict compliance with the rules of procedure. It is the essence of the NLRC Rules of Procedure to extend to every party-litigant the amplest opportunity for the proper and just determination of his cause, free from the constraints of technicalities. Accordingly, the substantial compliance with the procedural rules is appreciated in favor of Villa. For one, it belatedly submitted proof of Zanoria' s authority to verify the pleading for the petitioner. Also, it did not submit the certification of non-forum shopping at the time of the filing of the appeal. The nonsubmission of the certification, being a ground for dismissal, was fatal to the petition. There is no question that the non-compliance with the requirement for the certification, or a defect in the certification, would not be cured by the subsequent submission or the correction of the certification, except in cases of substantial compliance or upon compelling reasons. Accordingly, the dismissal of the petitioner's appeal cannot be reversed or undone. 2. Yes. We note that the CA and the NLRC agreed on their finding that the petitioner did not admit Villa back to work after the completion of her 10-day suspension. Neither did Villa's application for early retirement manifest her intention to sever the employer-employee relationship. Although she applied for early retirement, she did so upon the belief that she would receive a higher benefit based on the petitioner's offer. As such, her consent to be retired could not be fairly deemed to have been knowingly and freely given. Retirement is the result of a bilateral act of both the employer and the employee based on their voluntary agreement that upon reaching a certain age, the employee agrees to sever his employment. The difficulty in the case of Villa arises from determining whether the retirement was voluntary or involuntary. On one hand, voluntary retirement cuts the employment ties leaving no residual employer liability; on the other, involuntary retirement amounts to a discharge, rendering the employer liable for termination without cause. In case of early retirement programs, the offer of benefits must be certain while the acceptance to be retired should be absolute. The acceptance by the employees contemplated herein must be explicit, voluntary, free and uncompelled. Under the circumstances, the CA did not err in declaring the petitioner guilty of illegal dismissal for violating Article 282 of the Labor Code and the twin notice rule. CLASSES OF EMPLOYEES ALUMAMAY JAMIAS ET AL VS. NLRC G.R. No. 159350, March 9, 2016 Doctrine: Article 280 does not preclude an agreement providing for a fixed term of employment knowingly and voluntarily executed by the parties. The test to determine whether a particular employee is engaged as a project or regular employee is whether or not the employee is assigned to carry out a specific project or undertaking, the duration or scope of which was specified at the time of his engagement. There must be a determination of, or a clear agreement on, the completion or termination of

the project at the time the employee is engaged and it must satisfactorily appear that the employer and employee dealt with each other on more or less equal terms. Facts: Respondent Innodata Philippines, Inc. (Innodata), a domestic corporation engaged in the business of data processing and conversion for foreign clients, hired the several individuals on various dates. After the respective contracts of the employees expired, they filed a complaint for illegal dismissal claiming that Innodata had made it appear that they had been hired as project employees in order to prevent them from becoming regular employees. The petitioners argue that Innodata circumvented the security of tenure by providing a fixed term; and that they were regular employees because of the work they performed were necessary and desirable to the business of Innodata. Issue: Were the petitioners regular or project employees of Innodata? Ruling/Ratio: Petitioners are project employees. A fixed period in a contract of employment does not by itself signify an intention to circumvent Article 280 of the Labor Code. The provision contemplates three kinds of employees, namely: (a) regular employees; (b) project employees; and (c) casuals who are neither regular nor project employees. The nature of employment of a worker is determined by the factors provided in Article 280 of the Labor Code, regardless of any stipulation in the contract to the contrary. Obviously, Article 280 does not preclude an agreement providing for a fixed term of employment knowingly and voluntarily executed by the parties. A fixed term agreement, to be valid, must strictly conform to the requirements and conditions provided in Article 280 of the Labor Code. The test to determine whether a particular employee is engaged as a project or regular employee is whether or not the employee is assigned to carry out a specific project or undertaking, the duration or scope of which was specified at the time of his engagement. There must be a determination of, or a clear agreement on, the completion or termination of the project at the time the employee is engaged. Otherwise put, the fixed period of employment must be knowingly and voluntarily agreed upon by the parties, without any force, duress or improper pressure being brought to bear upon the employee and absent any other circumstances vitiating his consent, or it must satisfactorily appear that the employer and employee dealt with each other on more or less equal terms with no moral dominance whatsoever being exercised by the former on the latter. For one, it would be unusual for a company like Innodata to undertake a project that had no relationship to its usual business. Also, the necessity and desirability of the work performed by the employees are not the determinants in term employment, but rather the “day certain” voluntarily agreed upon by the parties. In fine, the employment of the petitioners who were engaged as project employees for a fixed term legally ended upon the expiration of their contract. Their complaint for illegal dismissal was plainly lacking in merit. TERMINATION OF EMPLOYMENT JENNIFER LAGAHIT VS. PACIFIC CONCORD CONTAINER LINES/ MONETTE CUENCA G.R. No. 177680, January 13, 2016 Doctrine: In cases of unlawful dismissal, the employer bears the burden of proving that the termination was for a valid or authorized cause, but before the employer is expected to discharge its burden of proving that the dismissal was legal, the employee must first establish by substantial evidence the fact of her dismissal from employment.

Facts: Respondent Pacific Concord Container Lines, a domestic corporation engaged in cargo forwarding, hired the petitioner as an Account Executive/Marketing Assistant. In January 2002, Pacific Concord promoted her as a sales manager with the monthly salary rate of P25,000.00, and provided her with a brand new Toyota Altis plus gasoline allowance. On November 8, 2002, she reported for work at 9:00 a.m. and left the company premises at around 10:30 a.m. to make client calls. At 1:14 p.m. of that day, she received the text message from respondent Monette Cuenca saying she is no longer connected with them. Pacific Concord also caused the publication of the notice to the public in the Sunstar Daily. Petitioner filed her complaint for constructive dismissal. In their position paper, the respondents denied having terminated the petitioner despite the fact that there were valid grounds to do so. They insisted that the petitioner had betrayed the trust and confidence reposed in her when she: (a) used the company-issued vehicle for her own personal interest; (b) failed to achieve her sales quota, and to enhance and develop the Sales Department; (c) enticed her marketing assistant, Jo Ann Otrera, to resign and join her in transferring to another forwarding company; (d) applied for other employment during office hours and using company resources; (e) solicited and offered the services of Seajet International, Inc. during her employment with Pacific Concord; (f) received a personal commission from Wesport Line, Inc. for container shipments; and ( g) illegally manipulated and diverted several containers to Seajet International. Issue: Did the petitioner resign as sales manager of Pacific Concord? Did Pacific Concord have sufficient grounds to terminate her for breach of trust and confidence under Article 282 of the Labor Code? Ruling/Ratio: Lagahit did not resign from her employment. In cases of unlawful dismissal, the employer bears the burden of proving that the termination was for a valid or authorized cause, but before the employer is expected to discharge its burden of proving that the dismissal was legal, the employee must first establish by substantial evidence the fact of her dismissal from employment. In this case, the petitioner proved the overt acts committed by the respondents in abruptly terminating her employment through the text messages sent by Cuenca to the petitioner and her husband, as well as the notices distributed to the clients and published in the Sun Star. It is notable that the respondents did not deny or controvert her evidence on the matter. Thereby, she showed Pacific Concord’s resolve to terminate her employment effective November 8, 2002. As a rule, the employer who interposes the resignation of the employee as a defense should prove that the employee voluntarily resigned. The resignation must be unconditional and with a clear intention to relinquish the position. Consequently, the circumstances surrounding the alleged resignation must be consistent with the employee’s intent to give up the employment. In this connection, the acts of the employee before and after the resignation are considered to determine whether or not she intended, in fact, to relinquish the employment. Here, the facts and circumstances before and after the petitioner’s severance from her employment did not show her resolute intention to relinquish her job. Indeed, it would be unfounded to infer the intention to relinquish from her letter, which, to us, was not a resignation letter due to the absence therefrom of anything evincing her desire to sever the employer-employee relationship. The letter instead presented her as a defenseless employee unjustly terminated for unknown reasons who had been made the subject of notices and flyers informing the public of her unexpected termination. It also depicted her as an employee meekly accepting her unexpected fate and requesting the payment of her backwages and accrued benefits just to be done with the employer. Lagahit did not breach her employer’s trust; her dismissal was, therefore, illegal. To justify the dismissal of an employee, the employer must prove that the dismissal was for a just cause, and that the employee was afforded due process prior to dismissal. As a complementary principle, the

employer has the onus of proving the validity of the dismissal with clear, accurate, consistent, and convincing evidence. Article 282(c) of the Labor Code authorizes an employer to dismiss an employee for committing fraud, or for willful breach of the trust reposed by the employer. However, loss of confidence is never intended to provide the employer with a blank check for terminating its employee. For this to be a valid ground for the termination of the employee, the employer must establish that: (1) the employee must be holding a position of trust and confidence; and (2) the act complained against would justify the loss of trust and confidence. There are two classes of employees vested with trust and confidence. To the first class belong the managerial employees or those vested with the powers or prerogatives to lay down management policies and to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees or effectively recommend such managerial actions. The second class includes those who in the normal and routine exercise of their functions regularly handle significant amounts of money or property. Cashiers, auditors, and property custodians are some of the employees in the second class. The petitioner discharged the duties and responsibilities as sales manager. Her position as sales manager did not immediately make the petitioner a managerial employee. It was her actual work not her job title, determines whether she was a managerial employee vested with trust and confidence. Her employment as sales manager was directly related with the sales of cargo forwarding services of Pacific Concord, and had nothing to do with the implementation of the management’s rules and policies. As such, the position of sales manager came under the second class of employees vested with trust and confidence. At any rate, the employer must present clear and convincing proof of an actual breach of duty committed by the employee by establishing the facts and incidents upon which the loss of confidence in the employee may fairly be made to rest. The required amount of evidence for doing so is substantial proof. With these guidelines in mind, we cannot hold that the evidence submitted by the respondents (consisting of the three affidavits) sufficiently established the disloyalty of the petitioner. The affidavits did not show how she had betrayed her employer’s trust. Considering that the petitioner’s duties related to the sales of forwarding services offered by Pacific Concord, her calling other forwarding companies to inquire for vacant positions did not breach the trust reposed in her as sales manager. Such act, being at worst a simple act of indiscretion, did not constitute the betrayal of trust that merited the extreme penalty of dismissal from employment. STRIKE HONGKONG & SHANGHAI BANKING CORPORATION ET AL VS. NLRC G.R. No. 156635, January 11, 2016 Doctrine: A strike staged without compliance with the requirements of Article 263 of the Labor Code is illegal, and may cause the termination of the employment of the participating union officers and members. However, the liability for the illegal strike is individual, not collective. To warrant the termination of an officer of the labor organization on that basis, the employer must show that the officer knowingly participated in the illegal strike. An ordinary striking employee cannot be terminated based solely on his participation in the illegal strike, for the employer must further show that the employee committed illegal acts during the strike. Facts: Petitioner Hongkong & Shanghai Banking Corporation Employees Union (Union) was the duly recognized collective bargaining agent of the rank-and-file employees of respondent Hongkong & Shanghai Banking Corporation (HSBC). Their CBA included a salary structure of the employees comprising of grade levels, entry level pay rates and the individual pays depending on the length of service. On January 18, 1993, HSBC announced its implementation of a job evaluation program (JEP) retroactive to January 1, 1993. The JEP consisted of a job designation per grade level with the accompanying salary scale providing for the minimum and maximum pay the employee could receive per salary level. By letter

dated January 20, 1993, The Union demanded the suspension of the JEP, which it labeled as an unfair labor practice (ULP). Union informed HSBC that it would exercise its right to concerted action. Union members started picketing during breaktime while wearing black hats and black bands on their arms and other appendages. Due to the sustained concerted actions, HSBC filed a complaint for ULP in the Arbitration Branch of the National Labor Relations Commission. The Union conducted a strike vote on 22 December 19, 1993 after HSBC accorded regular status to Patrick King, the first person hired under the JEP. The majority of the members of the Union voted in favor of a strike. Union's officers and members walked out and gathered outside the premises of HSBC's offices. Union members blocked the entry and exit points of the bank premises, preventing the bank officers. HSBC filed its complaint to declare the strike illegal. HSBC issued return-to-work notices to the striking employees. Only 25 employees complied and returned to work. Due to the continuing concerted actions, HSBC terminated the individual petitioners. Issue: Whether or not the strike was lawfully conducted and whether the petitioners were illegally dismissed Ruling/Ratio: Non-compliance with Article 263 of the Labor Code renders a labor strike illegal. The right to strike as a means for the attainment of social justice is never meant to oppress or destroy the employers. Thus, the law prescribes limits on the exercise of the right to strike. Article 263 of the Labor Code specifies the limitations on the exercise of the right to strike. The procedural requirements for a valid strike are (1) a notice of strike filed with the DOLE at least 30 days before the intended date thereof, or 15 days in case of ULP; (2) a strike vote approved by the majority of the total union membership in the bargaining unit concerned, obtained by secret ballot in a meeting called for that purpose; and (3) a notice of the results of the voting at least seven days before the intended strike given to the DOLE. These requirements are mandatory, such that non-compliance therewith by the union will render the strike illegal. Here, the petitioners neither filed the notice of strike with the DOLE, nor observed the cooling off period, nor submitted the result of the strike vote. Moreover, although the strike vote was conducted, the same was done by open, not secret, balloting, in blatant violation of Article 263 and Section 7, Rule XIII of the Omnibus Rules Implementing the Labor Code. It is not amiss to observe that the evident intention of the requirements for the strike-notice and the strike-vote report is to reasonably regulate the right to strike for the attainment of the legitimate policy objectives embodied in the law. As such, the petitioners committed a prohibited activity under Article 264(a) of the Labor Code, and rendered their strike illegal. Commission of unlawful acts during the strike further rendered the same illegal. The strike was far from orderly and peaceful. HSBC's claim that from the time when the strike was commenced on December 22, 1993 the petitioners had on several instances obstructed the ingress into and egress from its offices in Makati and in Pasig was not competently disputed, and should thus be accorded credence in the light of the records. It was undeniable that such acts of the strikers forced HSBC's officers to resort to unusual means of gaining access into its premises at one point. The situation during the strike actually went out of hand because of the petitioners' illegal conduct, compelling HSBC to secure an injunction from the NLRC as well as to file its petition for habeas corpus in the proper court in the interest of its trapped officers and employees; and at one point to lease an helicopter to extract its employees and officers from its premises on the eve of Christmas Day of 1993. Good faith did not avail because of the patent violation of Article 263 of the Labor Code. The petitioners' disregard of the procedural requirements for conducting a valid strike negated their claim of good faith. For their claim to be upheld, it was not enough for them to believe that their employer was guilty of ULP, for they must also sufficiently show that the strike was undertaken with a modicum of obeisance to the restrictions on their exercise of the right to strike prior to and during its execution as prescribed by the law. They did not establish their compliance with the requirements specifically for the holding of the strike vote and the giving of the strike notice.

The finding on the illegal strike did not justify the wholesale termination of the strikers from employment. As a general rule, the mere finding of the illegality of the strike does not justify the wholesale termination of the strikers from their employment. To avoid rendering the recognition of the workers' right to strike illusory, the responsibility for the illegal strike is individual instead of collective. The last paragraph of Article 264(a) of the Labor Code defines the norm for terminating the workers participating in an illegal strike. The officers may be deemed terminated from their employment upon a finding of their knowing participation in the illegal strike, but the members of the union shall suffer the same fate only if they are shown to have knowingly participated in the commission of illegal acts during the strike. In the case of Fermin, HSBC did not satisfactorily prove his presence during the strike, much less identify him as among the strikers. In contrast, Union president Ma. Dalisay dela Chica testified that Fermin was not around when the Union's Board met after the strike vote to agree on the date of the strike. In that regard, Corazon Fermin, his widow, confirmed the Union president's testimony by attesting that her husband had been on leave from work prior to and during the strike because of his heart condition. Although Corazon also attested that her husband had fully supported the strike, his extending moral support for the strikers did not constitute sufficient proof of his participation in the strike in the absence of a showing of any overt participation by him in the illegal strike. The burden of proving the overt participation in the illegal strike by Fermin solely belonged to HSBC, which did not discharge its burden. However, the dismissal of Rivera and of the rest of the Union's officers is upheld. Regardless of whether the strike was illegal or not, the dismissal of the members could be upheld only upon proof that they had committed illegal acts during the strike. They must be specifically identified because the liability for the prohibited acts was determined on an individual basis. For that purpose, substantial evidence available under the attendant circumstances justifying the penalty of dismissal sufficed. LABOR UNION RIGHTS THE HERITAGE HOTEL MANILA VS. SECRETARY OF LABOR AND EMPLOYMENT ET AL G.R. No. 172132, July 23, 2014 Doctrine: Basic in the realm of labor union rights is that the certification election is the sole concern of the workers, and the employer is deemed an intruder as far as the certification election is concerned. Facts: Respondent National Union of Workers in Hotel Restaurant and Allied Industries-Heritage Hotel Manila Supervisors Chapter (NUWHRAIN-HHMSC) filed a petition for certification election, seeking to represent all the supervisory employees of Heritage Hotel Manila. The petitioner filed its opposition, but the opposition was deemed denied when the Med-Arbiter issued his order for the conduct of the certification election. The petitioner appealed the order of Med-Arbiter, but the appeal was also denied. A pre-election conference was then scheduled however it was suspended until further notice because of the repeated non-appearance of NUWHRAINHHMSC. On January 29, 2000, NUWHRAIN-HHMSC moved for the conduct of the pre-election conference. The petitioner filed a motion to dismiss raising the prolonged lack of interest of NUWHRAIN-HHMSC to pursue its petition for certification election. On May 12, 2000, the petitioner filed a petition for the cancellation of NUWHRAIN-HHMSC’s registration as a labor union for failing to submit its annual financial reports and an updated list of members as required by Article 238 and Article 239 of the Labor Code. The following day, however, the Department of Labor and Employment (DOLE) issued a notice scheduling the certification elections on June 23, 2000. Dissatisfied, the petitioner commenced in the CA a special civil action for certiorari, alleging that the DOLE gravely abused its discretion in not suspending the certification election proceedings but the CA dismissed the petition for certiorari. The certification election proceeded as scheduled, and NUWHRAIN-HHMSC obtained the majority vote of the bargaining unit. On January 26, 2001, Med-Arbiter issued an order, ruling that the petition for the cancellation of union registration was not a bar to the holding of the certification election; hence, respondent employer/protestant’s protest with motion to defer certification of results and winner is hereby dismissed for lack of merit. The petitioner timely appealed to the DOLE Secretary. On August 21, 2002, then DOLE Secretary Sto. Tomas issued a resolution denying the appeal. Upon denial of its motion

for reconsideration, the petitioner elevated the matter to the CA by petition for certiorari, but the petition was dismissed. Issue: Whether or not the CA seriously erred when it disregard PROGRESSIVE DEVELOPMENT CORPORATION – PIZZA HUT V. LAGUESMA which held that it would be more prudent to suspend the certification case until the issue of the illegality of registration of the union is finally resolved. Ruling/Ratio: No. Basic in the realm of labor union rights is that the certification election is the sole concern of the workers, and the employer is deemed an intruder as far as the certification election is concerned. Thus, the petitioner lacked the legal personality to assail the proceedings for the certification election, and should stand aside as a mere bystander who could not oppose the petition, or even appeal the MedArbiter’s orders relative to the conduct of the certification election. Under the long established rule, too, the filing of the petition for the cancellation of NUWHRAINHHMSC’s registration should not bar the conduct of the certification election. In that respect, only a final order for the cancellation of the registration would have prevented NUWHRAIN-HHMSC from continuing to enjoy all the rights conferred on it as a legitimate labor union, including the right to the petition for the certification election. This rule is now enshrined in Article 238-A of the Labor Code, as amended by Republic Act No. 9481. On NUWHRAIN-HHMSC’s failure to submit its periodic financial reports and updated list of its members pursuant to Article 238 and Article 239 of the Labor Code, we cannot ascribe abuse of discretion to the Regional Director and the DOLE Secretary in denying the petition for cancellation of respondent's registration. The union members and, in fact, all the employees belonging to the appropriate bargaining unit should not be deprived of a bargaining agent, merely because of the negligence of the union officers who were responsible for the submission of the documents to the BLR. The Labor Code's provisions on cancellation of union registration and on reportorial requirements have been recently amended by R.A. No. 9481, which lapsed into law on May 25, 2007 and became effective on June 14, 2007. The amendment sought to strengthen the workers’ right to self-organization and enhance the Philippines' compliance with its international obligations as embodied in the International Labor Organization (ILO) Convention No. 87, pertaining to the non-dissolution of workers’ organizations by administrative authority. Failure to comply with the above requirements shall not be a ground for cancellation of union registration but shall subject the erring officers or members to suspension, expulsion from membership, or any appropriate penalty. KINDS OF EMPLOYEES; PROJECT EMPLOYEES VOLUNTARYRESIGNATION D.M. CONSUNJI CORPORATION vs ROGELIO P. BELLO G.R. No. 159371, July 29, 2013 Doctrine: A project employee is one who is hired for a specific project or undertaking, and the completion or termination of such project or undertaking had been determined at the time of engagement of the employee. However, the extension of the employment of a project employee long after the supposed project has been completed removes the employee from the scope of a project employee and makes him a regular employee. Voluntary Resignation: For the resignation of an employee to be a viable defense in an action for illegal dismissal, an employer must prove that the resignation was voluntary, and its evidence thereon must be clear, positive and convincing. The employer cannot rely on the weakness of the employee's evidence. Facts: Respondent claim that petitioner had employed him as a mason without interruption from February 1, 1990 until October 10 1997. During his employment, he was diagnosed to be suffering from Pulmonary

Tuberculosis (PTB), thereby necessitating his leave of absence. Upon his recovery, he reported back to work, but the petitioner had refused to accept him and had instead handed to him a termination paper due to “RSD”. He contends that he does not know the meaning of RSD as the cause of his termination and that it was not explained to him. However, petitioner contends that respondent had only been a project employee. That the respondent tendered his voluntary resignation for health reasons that had rendered him incapable of performing his job. That after his termination from employment, petitioner complied with the reportorial requirement of the DOLE. Respondent filed an illegal dismissal complaint against the petitioner. Issue/s: 1. Whether or not respondent was a regular employee. 2. Whether or not respondent voluntarily resigned. Ruling/Ratio: 1. Yes, respondent was a regular employee. A project employee is one who is hired for a specific project or undertaking, and the completion or termination of such project or undertaking had been determined at the time of engagement of the employee. However, the extension of the employment of a project employee long after the supposed project has been completed removes the employee from the scope of a project employee and makes him a regular employee. In this case, the respondent’s appointment and employment showed that he performed his tasks as a mason in DMCI’s various constructions projects. His successive re-engagement in order to perform the same kind of work as a mason firmly manifested the necessity and desirability of his work in DMCI’s usual business construction. 2. No. For the resignation of an employee to be a viable defense in an action for illegal dismissal, an employer must prove that the resignation was voluntary, and its evidence thereon must be clear, positive and convincing. The employer cannot rely on the weakness of the employee's evidence. In this case, the Court affirmed the ruling of the CA that the supposed resignation letter was undeniably different from that of the complainant, something that DMCI had not rebutted. ILLEGALLY DISMISSED EMPLOYEES MANILA JOCKEY CLUB, INC. vs AIMEE O. TRAJANO G.R. No. 160982, June 26, 2013 Doctrine: An illegally dismissed employee is entitled to her reinstatement without loss of seniority rights and other privileges, and to full backwages, inclusive of allowances and other benefits or their monetary equivalent. Should the reinstatement be no longer feasible, an award of separation pay in lieu of reinstatement will be justified, and the backwages shall be reckoned from the time her wages were withheld until the finality of the decision. Facts: Petitioner employed respondent as a selling teller of betting tickets since November 1989. On April 25, 1989, two regular bettors gave their respective list of bets and money for the bets for Race 14. Later, she realized that she had a mistake on cancelling the bet of the other bettor that was supposedly for the other bettor and explained that the cancellation was not intentional but a result of an honest mistake on her part. She offered to personally pay the dividends should the other bettor win the Race, which the latter accepted. However, the other bettor lost, thus relieved of the obligation to pay any winnings. The reliever-supervisor of the petitioner later approached the respondent and told her to submit a written explanation about the ticket cancellation incident in which she complied. She submitted a hand written explanation to the Assistant Racing Supervisor. She was then informed that she was placed under

preventive suspension, for an unstated period of time. At the end of 30 days of her suspension, she reported back for work. But she was no longer admitted. She then learned that she had been dismissed when she read a copy of an inter-office correspondence about her termination posted in a selling situation. Respondent filed a complaint of illegal dismissal against petitioner. In 1998, more than 14 years from the time of her assailed dismissal, respondent filed her position paper. She contends that her dismissal was without due process of law because she was not notified about or furnished a copy of the notice of dismissal. The Labor Arbiter ruled in favor of the petitioner and dismissed the complaint. The NLRC reversed the LA’s ruling and held that respondent was illegally dismissed and entitled to be reinstated. In 2003, the CA upheld the ruling of the NLRC. The Supreme Court affirmed the decision of the CA but found that reinstatement is no longer possible. Issue: What are the entitlements of an illegally dismissed employees? Ruling/Ratio: There is no question that an illegally dismissed employee is entitled to her reinstatement without loss of seniority rights and other privileges, and to full backwages, inclusive of allowances and other benefits or their monetary equivalent. In case the reinstatement is no longer possible, however, an award of separation pay, in lieu of reinstatement, will be justified. The Court has ruled that reinstatement is no longer possible: (a) when the former position of the illegally dismissed employee no longer exists; or (b) when the employer’s business has closed down; or (c) when the employer-employee relationship has already been strained as to render the reinstatement impossible. The Court likewise considered reinstatement to be non-feasible because a “considerable time” has lapsed between the dismissal and the resolution of the case. In that regard, a lag of eight years or ten years is sufficient to justify an award of separation pay in lieu of reinstatement. Applying the foregoing to this case, the Court concludes that the reinstatement of Trajano is no longer feasible. More than 14 years have already passed since she initiated her complaint for illegal dismissal in 1998, filing her position paper on September 3, 1998, before the Court could finally resolve her case. The lapse of that long time has rendered her reinstatement an impractical, if not an impossible, option for both her and MJCI. Consequently, an award of separation pay has become the practical alternative, computed at one month pay for every year of service. LABOR UNION LEPANTO CONSOLIDATED MINING COMPANY vs THE LEPANTO CAPATAZ UNION GR No. 157086 February 18, 2013 Doctrine: Capatazes or foremen are not rank-and-file employees because they perform supervisory functions for the management, they are an extension of the management, and as such they may influence the rank-and-file workers under them to engage in slowdowns or similar activities detrimental to the policies, interests or business objectives of the employers.; hence, they may form their own union that is separate and distinct from the labor organization of rank-and file employees. Facts: Petitioner is a domestic corporation authorized to engage in large-sacle mining. Respondent is a labor organization duly registered with DOLE.

Respondent filed a petition for consent election with the Industrial Relations Division of Cordillera Regional Office of DOLE. They propose to represent 139 capatazes or foremen, employees of the Petitioner who are tasked to instruct miners and mackers with their performance. Petitioner opposed the petition, contending that the Union was in reality seeking a certification election, not a consent election and would be thereby competing with the Lepanto Employees Union (LEU), the current collective bargaining agent. Petitioner asserts that the capatazes were already members of the LEU, the exclusive representative of all rank-and-file employees of its Mine Division. Issue: Whether or not Capatazes can form their own union. Ruling/Ratio: Yes. Capatazes or foremen are not rank-and-file employees because they perform supervisory functions for the management, they are an extension of the management, and as such they may influence the rankand-file workers under them to engage in slowdowns or similar activities detrimental to the policies, interests or business objectives of the employers.; hence, they may form their own union that is separate and distinct from the labor organization of rank-and file employees.

CIVIL LAW PERSONS AND FAMILY RELATIONS Soledad Lavadia vs. Heirs of Juan Luces Luna G.R. No. 171914, July 23, 2014 Doctrine: Divorce between Filipinos is void and ineffectual under the nationality rule adopted by Philippine law. Hence, any settlement of property between the parties of the first marriage involving Filipinos submitted as an incident of a divorce obtained in a foreign country which lacks competent judicial approval cannot be enforced against the assets of the husband who contracts a subsequent marriage. Facts: Atty. Luna was first married to Eugenia. Subsequently, they entered into an “Agreement for Separation and Property Settlement”, whereby they agreed to live separately and to dissolve and liquidate their conjugal property. Atty. Luna obtained a divorce decree of his marriage in the CFI of Dominican Republic and contracted another marriage with Soledad. Atty. Luna and Soledad returned to the Philippines and lived together as husband and wife until 1987. Atty. Luna organized the law firm LUPSICON where he purchased a condominium as its office. Upon dissolution of LUPSICON, the condominium was partitioned with Atty. Luna receiving 25/100 interest. Thereafter, Atty. Luna established another law firm and used a portion of the condominium for its office. When Atty. Luna died, his share in the firm’s properties was taken over by his son on the first marriage, Gregorio Luna. These properties became the subject of the complaint filed by Soledad against the heirs of Atty. Luna. Soledad alleged that the subject properties were acquired through their joint efforts and since they had no children, Soledad became co-owner of the said properties. Issues: 1. Whether the divorce decree had validly dissolved the first marriage 2. Whether the “Agreement for Separation and Property Settlement” was valid and enforceable 3. Whether the second marriage entitled Soledad to any rights in the property of Atty. Luna Ruling/Ratio: 1. No, the first marriage had not been validly dissolved by the divorce decree. The law in force at the time of the first marriage was the Spanish Civil Code, which adopted the nationality rule, to the effect that Philippine laws relating to family rights and duties, or to the status, condition and legal capacity of persons were binding upon citizens of the Philippines, although living abroad. Both Atty. Luna and Eugenio are Filipinos. From the time of the celebration of the marriage on September 10, 1947 until the present, absolute divorce between Filipino spouses has not been recognized in the Philippines. Conformably, the divorce, even if voluntarily obtained abroad, did not dissolve the marriage between Atty. Luna and Eugenia, which subsisted up to the time of his death on July 12, 1997. 2. No, the Agreement for Separation and Property Settlement was void. Considering that Atty. Luna and Eugenia had not entered into any marriage settlement prior to their marriage, the system of relative community or conjugal partnership of gains governed their property relations. This is because the Spanish Civil Code did not specify the property regime of the spouses in the event that they had not entered into any marriage settlement before or at the time of the marriage. The mere execution of the Agreement by Atty. Luna and Eugenia did not per se dissolve and liquidate their conjugal partnership of gains. The approval of the Agreement by a competent court was still required under Article 190 and Article 191 of the Civil Code. Moreover, with the divorce not being itself valid and enforceable under Philippine law, the approval of the Agreement by the CFI of Dominican Republic was not also valid and enforceable. 3. No, Soledad was not entitled to any rights in the property of Atty. Luna. The second marriage was void for being bigamous, since the first marriage had not been dissolved by the Divorce Decree. As

the second marriage is void ab initio for being bigamous, the properties acquired during such marriage were governed by the rules on co-ownership. To establish co-ownership, the petitioner must prove her actual contributions in the acquisition of the property. Soledad was not able to prove that her own funds were used to buy the properties. LAW ON PRESCRIPTION Dico vs. Vizcaya Management Corp. GR No. 161211, July 17, 2013 Doctrine: The prescription of actions for the reconveyance of real property based on implied trust is 10 years. Facts: Spouses Dico were the possessors of Lot No. 29-B. Respondent Vizcaya Management Corporation (VMC) was the registered owner of the said lot deriving its title from Lopezes who were registered owners of the lot since September 30, 1934 until November 10, 1956, when the title to Lot 29-B was registered under VMC’s name. On May 12, 1986, the Dicos commenced an action for annulment and cancellation of the title of VMC alleging that the latter obtained it through fraud. The RTC ruled in favor of the Dicos. The CA reversed the decision and ruled that prescription and laches already barred the Dicos from asserting their rights. Issue: Whether prescription already barred petitioner’s cause of action Ruling/Ratio: Yes, the action of the Dicos for reconveyance has already prescribed. Under Article 1456 of the Civil Code, the person obtaining property through mistake or fraud is considered by force of law a trustee of an implied trust for the benefit of the person from whom the property comes. Under Article 1144 of the Civil Code, an action upon an obligation created by law must be brought within 10 years from the time the right of action accrues. Consequently, an action for reconveyance based on implied or constructive trust prescribes in 10 years. The filing of the complaint only on May 12, 1986 proved too late for them. The reckoning point for purposes of the Dicos’ demand of reconveyance based on fraud was their discovery of the fraud. Such discovery was properly pegged on the date of the registration of the TCT in the adverse parties’ names, because registration was a constructive notice to the whole world. The long period of 29 years that had lapsed from the issuance of the TCT on September 30, 1934 (the date of recording of TCT in the name of the Lopezes) or on November 10, 1956 (the date of recording of TCT in VMC’s name) was way beyond the prescriptive period of 10 years. LAND TITLE AND DEEDS Heirs of Malabanan vs. Republic GR No. 179987, September 3, 2013 Doctrine: Section 48(b) of the Public Land Act, in relation to Section 14(1) 1 of the Property Registration Decree, presupposes that the land subject of the application for registration must have been already classified as agricultural land of the public domain in order for the provision to apply. Thus, absent proof Section 14. Who may apply. – The following persons may file in the proper Court of First Instance an application for registration of title to land, whether personally or through their duly authorized representatives: (1) Those who by themselves or through their predecessors-in-interest have been in open, continuous, exclusive and notorious possession and occupation of alienable and disposable lands of the public domain under a bona fide claim of ownership since June 12, 1945, or earlier. 1

that the land is already classified as agricultural land of the public domain, the Regalian Doctrine applies, and overcomes the presumption that the land is alienable and disposable as laid down in Section 48(b) of the Public Land Act. On the other hand, if a public land is classified as no longer intended for public use or for the development of national wealth by declaration of Congress or the President, thereby converting such land into patrimonial or private land of the State, the applicable provision concerning disposition and registration is no longer Section 48(b) of the Public Land Act but the Civil Code, in conjunction with Section 14(2)2 of the Property Registration Decree. As such, prescription can now run against the State. Facts: On February 20, 1998, Malabanan purchased a land from Velasco and filed an application for land registration. Malabanan presented a certification issued by CENRO-DENR which states that the land was classified as alienable and disposable on March 15, 1982. The RTC granted the application. The CA reversed the RTC decision and dismissed Malabanan’s application on the ground that under Section 14(1) of the Property Registration Decree (PRD), any period of possession prior to the classification of the land as alienable and disposable (i.e., March 15, 1982) should be excluded from the computation of the period of possession. In their motion, petitioners submit that the mere classification of the land as alienable or disposable should be deemed sufficient to convert it into patrimonial property. They argue that the reclassification of the land as alienable or disposable opened it to acquisitive prescription under the Civil Code; that Malabanan had purchased the property believing in good faith that Velazco and his predecessors-ininterest had been the real owners of the land; that consequently, the 10-year period prescribed by Article 1134 of the Civil Code, in relation to Section 14(2) of the PRD, applied in their favor; and that when Malabanan filed the application for registration on February 20, 1998, he had already been in possession of the land for almost 16 years reckoned from 1982, the time when the land was declared alienable and disposable by the State. On the other hand, the Republic contends that that an applicant is entitled to registration only when the land subject of the application had been declared alienable and disposable since June 12, 1945 or earlier. Issue: Whether Malabanan is entitled to the registration of the land Ruling/Ratio: No, Malabanan is not entitled to the registration of the land. As a general rule and pursuant to the Regalian Doctrine, all lands of the public domain belong to the State and are inalienable. Lands that are not clearly under private ownership are also presumed to belong to the State and, therefore, may not be alienated or disposed. The following are exceptions to the general rule: 1. Agricultural lands of the public domain are rendered alienable and disposable through any of the exclusive modes enumerated under Section 11 of the Public Land Act. If the mode is judicial confirmation of imperfect title under Section 48(b) of the Public Land Act, the agricultural land subject of the application needs only to be classified as alienable and disposable as of the time of the application, provided the applicant’s possession and occupation of the land dated back to June 12, 1945, or earlier. Thereby, a conclusive presumption that the applicant has performed all the conditions essential to a government grant arises, and the applicant becomes the owner of the land by virtue of an imperfect or incomplete title. By legal fiction, the land has already ceased to be part of the public domain and has become private property.

Section 14. Who may apply. – The following persons may file in the proper Court of First Instance an application for registration of title to land, whether personally or through their duly authorized representatives: xxxx (2) Those who have acquired ownership of private lands by prescription under the provisions of existing laws. 2

2. Lands of the public domain subsequently classified or declared as no longer intended for public use or for the development of national wealth are removed from the sphere of public dominion and are considered converted into patrimonial lands or lands of private ownership that may be alienated or disposed through any of the modes of acquiring ownership under the Civil Code. If the mode of acquisition is prescription, whether ordinary or extraordinary, proof that the land has been already converted to private ownership prior to the requisite acquisitive prescriptive period is a condition sine qua non in observance of the law (Article 1113, Civil Code) that property of the State not patrimonial in character shall not be the object of prescription. The petitioners failed to present sufficient evidence to establish that they and their predecessors-ininterest had been in possession of the land since June 12, 1945. Without satisfying the requisite character and period of possession - possession and occupation that is open, continuous, exclusive, and notorious since June 12, 1945, or earlier - the land cannot be considered ipso jure converted to private property even upon the subsequent declaration of it as alienable and disposable. Prescription never began to run against the State, such that the land has remained ineligible for registration under Section 14(1) of the PRD. Likewise, the land continues to be ineligible for land registration under Section 14(2) of the PRD unless Congress enacts a law or the President issues a proclamation declaring the land as no longer intended for public service or for the development of the national wealth. LAND TITLE AND DEEDS Cusi vs. Domingo GR No. 195825, February 27, 2013 Doctrine: Under the Torrens system of land registration, the registered owner of realty cannot be deprived of her property through fraud, unless a transferee acquires the property as an innocent purchaser for value. A transferee who acquires the property covered by a reissued owner’s copy of the certificate of title without taking the ordinary precautions of honest persons in doing business and examining the records of the proper Registry of Deeds, or who fails to pay the full market value of the property is not considered an innocent purchaser for value. Facts: On July 18, 1997, Radelia Sy, representing herself as the owner of a certain property, petitioned the RTC for the issuance of a new owner’s copy of Domingo’s TCT No. N-165606. Appending to her petition were a Deed of Absolute Sale dated July 14, 1997 purportedly executed in her favor by Domingo and an affidavit of loss claiming that her bag containing the owner’s copy of TCT No. N-165606 had been snatched from her. The RTC granted Sy’s application and the Registry of Deeds issued a new TCT in Sy’s name. Subsequently, Sy subdivided the property into two, and sold each half by way of contract to sell to Spouses De Vera and Spouses Cusi. All the while, these transactions were unknown to Domingo whose TCT No. T-165606 remained in her possession. In July 1999, Domingo learned that construction activities were being undertaken on her property without her consent. Domingo commenced an action against spouses Sy, the De Veras and the Cusis seeking the annulment and cancellation of titles, injunction and damages. Issue: Whether the petitioners are buyers in good faith and for value Ruling/Ratio: No, the petitioners are not purchasers in good faith and for value. A person dealing in registered land has the right to rely on the Torrens certificate of title and to dispense with the need of inquiring further, except when the party has actual knowledge of facts and circumstances that would impel a reasonable cautious man to make such inquiry.

There is no question that the petitioners exerted some effort as buyers to determine whether the property did rightfully belong to Sy. Nonetheless, their observance of a certain degree of diligence within the context of the principles underlying the Torrens system was not their only barometer under the law and jurisprudence by which to gauge the validity of their acquisition of title. As the purchasers of the property, they also came under the clear obligation to purchase the property not only in good faith but also for value. The petitioners were shown to have been deficient in their vigilance as buyers of the property. It was not enough for them to show that the property was unfenced and vacant. Otherwise, it would be too easy for any registered owner to lose her property, including its possession, through illegal occupation. Nor is it safe for them to simply rely on the face of Sy’s TCT in view of the fact that they were aware that her TCT was derived from a duplicate owner’s copy. That circumstance should have already alerted them to the need to inquire beyond the face of Sy’s TCT. There were other circumstances, like the almost simultaneous transactions affecting the property within a short span of time, as well as the gross undervaluation of the property in the deeds of sale. That also excited suspicion, and required them to be extra cautious in dealing with Sy on the property. LAND TITLE AND DEEDS Republic vs. Zurbaran Realty and Development Corporation GR No. 164408, March 24, 2014 Doctrine: An application for original registration of the public domain under Section 14(2) of Presidential Decree No. 1529 must show not only that the land has previously been declared alienable and disposable, but also that the land has been declared patrimonial property of the State at the onset of the 30-year or 10-year period of possession and occupation required under the law on acquisitive prescription. Facts: Respondent Zurbaran Realty and Development Corporation filed an application for original registration of land claiming that it had purchased the land on March 9, 1992 from Abalos and that the applicant and its predecessors–in–interest had been in open, continuous and exclusive possession and occupation of the land in the concept of an owner. The Republic opposed the application, arguing that the applicant and its predecessors–in–interest had not been in open, continuous, exclusive and notorious possession and occupation of the land since June 12, 1945; that the land was a portion of the public domain, and, therefore, was not subject to private appropriation. A certification was issued by the LMB stating that it had no record of any kind of public land applications/land patents covering the subject land. The RTC granted the application for registration and affirmed by the CA. Issue: Whether the Respondent is entitled to the registration of the land Ruling/Ratio: No, the Respondent is not entitled to the registration of the land. Section 14 of P.D. No. 1529 enumerates those who may file an application for registration of land based on possession and occupation of a land of the public domain: (1) Those who by themselves or through their predecessors-in-interest have been in open, continuous, exclusive and notorious possession and occupation of alienable and disposable lands of the public domain under a bona fide claim of ownership since June 12, 1945, or earlier. (2) Those who have acquired ownership of private lands by prescription under the provision of existing laws. An application for registration under Section 14(1) of PD 1529 must establish the following requisites: (1) the land is alienable and disposable property of the public domain; (2) the applicant and its predecessors in interest have been in open, continuous, exclusive and notorious possession and occupation of the land

under a bona fide claim of ownership; and (3) the applicant and its predecessors-in-interest have possessed and occupied the land since June 12, 1945 or earlier. It is not necessary that the land must be alienable and disposable as of June 12, 1945, or earlier, because the law simply requires the property sought to be registered to be alienable and disposable at the time the application for registration of title is filed. In other words, registration under Section 14(1) of PD No. 1529 is based on possession and occupation of the alienable and disposable land of the public domain since June 12, 1945, or earlier, without regard to whether the land was susceptible to private ownership at that time. The applicant needs only to show that the land had already been declared alienable and disposable at any time prior to the filing of the application for registration. On the other hand, an application under Section 14(2) of PD No. 1529 is based on acquisitive prescription and must comply with the law on prescription as provided by the Civil Code. In that regard, only the patrimonial property of the State may be acquired by prescription pursuant to the Civil Code. Therefore, for acquisitive prescription to set in, the land being possessed and occupied must already be classified or declared as patrimonial property of the State. Otherwise, no length of possession would vest any right in the possessor if the property has remained land of the public dominion. Even if the land is later converted to patrimonial property of the State, possession of it prior to such conversion will not be counted to meet the requisites of acquisitive prescription. Thus, registration under Section 14(2) of PD No. 1529 requires that the land had already been converted to patrimonial property of the State at the onset of the period of the possession required by the law on prescription. An application for registration based on Section 14(2) of PD No. 1520 must, therefore, establish the following requisites: (a) the land is an alienable and disposable, and patrimonial property of the public domain; (b) the applicant and its predecessors-in-interest have been in possession of the land for at least 10 years, in good faith and with just title, or for at least 30 years, regardless of good faith and just title; and (c) the land had already been converted to or declared as patrimonial property of the State at the beginning of the said 10-year or 30-year period of possession. The respondent’s application does not enlighten as to whether it was filed under Section 14(1) or Section 14(2) of PD No. 1529. The application alleged that the respondent and its predecessors-in-interest had been in open, continuous and exclusive possession and occupation of the property in the concept of an owner, but did not state when possession and occupation commenced and the duration of such possession. At any rate, the evidence presented by the respondent and its averments reveal that the application for registration was filed based on Section 14(2), not Section 14(1) of PD No. 1529. The respondent did not make any allegation in its application that it had been in possession of the property since June 12, 1945, or earlier, nor did it present any evidence to establish such fact. Moreover, there is no evidence showing that the land in question was within the area expressly declared by law either to be the patrimonial property of the State, or to be no longer intended for public service or the development of the national wealth. Hence, the application for registration should be dismissed. LAND TITLE AND DEEDS Republic vs De Joson GR No. 163767, March 10, 2014 Doctrine: Under Section 14(1) of the Property Registration Decree, the applicant had to prove that: (1) the land forms part of the alienable and disposable land of the public domain; and (2) he, by herself or through her predecessors-in-interest, had been in open, continuous, exclusive, and notorious possession and occupation of the land under a bona fide claim of ownership from June 12, 1945, or earlier. It is the applicant who carries the burden of proving that the two requisites have been met.

Facts: Respondent filed her application for land registration covering a rice land which had been originally owned and possessed by Mamerto Dionisio since 1907. Dionisio, by way of Deed of Sale, sold the land to Romualda Jacinto. Maria Jacinto, mother of the respondent, inherited the land from her sister, Romualda. Upon the death of Maria, the respondent inherited the same, owning and possessing it openly, publicly, uninterruptedly, adversely against the whole world, and in the concept of owner. In their opposition, the Director of Lands and the Director of Forest Development averred that whatever legal and possessory rights the respondent had acquired by reason of any Spanish government grants had been lost, abandoned or forfeited for failure to occupy and possess the land for at least 30 years immediately preceding the filing of the application; and that the land applied for, being actually a portion of the Labangan Channel operated by the Pampanga River Control System, could not be subject of appropriation or land registration. The CFI ordered the registration of the land in favor of the respondent. Issue: Whether the respondent is entitled to the registration of the land Ruling/Ratio: No, the land is not susceptible for registration. Under Section 14(1) of the Property Registration Decree, the respondent had to prove that: (1) the land forms part of the alienable and disposable land of the public domain; and (2) she, by herself or through her predecessors-in-interest, had been in open, continuous, exclusive, and notorious possession and occupation of the land under a bona fide claim of ownership from June 12, 1945, or earlier. It is the applicant who carries the burden of proving that the two requisites have been met. Failure to do so warrants the dismissal of the application. The respondent complied with the second requisite by virtue of her having in open, continuous, exclusive and notorious possession and occupation of the land since June 12, 1945, or earlier. Nonetheless, the respondent did not discharge her burden to prove classification of the land as demanded by the first requisite. She did not present evidence of the land, albeit public, having been declared alienable and disposable by the State. Belatedly realizing her failure to prove the alienable and disposable classification of the land, the petitioner attached a certification dated March 8, 2000 issued by the DENR-CENRO stating that the land subject of application is an alienable and disposable land. To be subject of appropriation, the land of public domain must be declared alienable and disposable either by the President or the Secretary of DENR. This doctrine unavoidably means that the mere certification issued by the CENRO or PENRO did not suffice to support the application for registration, because the applicant must also submit a copy of the original classification of the land as alienable and disposable as approved by the DENR Secretary and certified as a true copy by the legal custodian of the official records. The Regalian doctrine dictates that all lands of the public domain belong to the State. The applicant for land registration has the burden of overcoming the presumption of State ownership by establishing through incontrovertible evidence that the land sought to be registered is alienable or disposable based on a positive act of the government. Thus, the present rule is that an application for original registration must be accompanied by the following: (1) a CENRO or PENRO Certification; and (2) a copy of the original classification approved by the DENR Secretary and certified as a true copy by the legal custodian of the official records. LAND TITLE AND DEEDS Republic vs. Bautista, Jr. GR No. 166890, June 28, 2016 Doctrine: Only the title of those who had possessed and occupied alienable and disposable lands of the public domain since June 12, 1945 or earlier could be judicially confirmed. Indeed, alienable public land held by a possessor, either personally or through his predecessors-in-interest, openly, continuously and

exclusively during the prescribed statutory period is converted to private property by the mere lapse or completion of the period. Facts: In 1996, after inheriting a land from his father, Apolonio, Jr. commenced an application for land registration in the MTC. He testified that his father had been in actual possession since 1969, and had eventually acquired the land from Jardin and Villanueva through the notarized Deeds of Absolute Sale and that his father had paid taxes on the land. The MTC granted Apolonio, Jr’s application and declared him as the owner in fee simple of the land, and confirmed his ownership thereof. The government appealed the decision pointing out that Apolonio, Jr. had given general statements pertaining to the open, continuous, exclusive and notorious possession of his father. It also averred that because the application of imperfect title was filed on October 21, 1996, the applicable law was Section 48(b) of the Public Land Act. Accordingly, the required period of possession must be June 12, 1945 or earlier. Issue: Whether Apolonio, Jr. is entitled to the registration of the land Ruling/Ratio: No, Apolonio, Jr. is not entitled to the registration as he failed to establish his lawful occupation of the land. The requisite period of possession of the property should conform to that provided for in Section 48(b) of the Public Land Act, as amended, which has limited the right to apply for judicial confirmation to citizens of the Philippines "who by themselves or through their predecessors in interest have been in open, continuous, exclusive, and notorious possession and occupation of alienable and disposable lands of the public domain, under a bona fide claim of acquisition of ownership, since June 12, 1945, or earlier, immediately preceding the filing of the application for confirmation of title except when prevented by war or force majeure.” Apolonio, Jr. presented only himself to establish the possession and ownership of his father who was his immediate predecessor-in-interest. He did not present as witnesses during the trial either of the transferors of Apolonio, Sr. - that is, Jardin or Villanueva - to establish the requisite length of the possession of the predecessors-in-interest of the applicant that would be tacked to his own. Considering that the possession and occupation of the property in question by Apolonio, Jr. and his predecessors-ininterest were not shown in the records to have been "since June 12, 1945, or earlier," the application must be rejected. It should be stressed that only the title of those who had possessed and occupied alienable and disposable lands of the public domain within the requisite period could be judicially confirmed. Indeed, alienable public land held by a possessor, either personally or through his predecessors-in-interest, openly, continuously and exclusively during the prescribed statutory period is converted to private property by the mere lapse or completion of the period. CREDIT TRANSACTIONS Spouses Pen vs. Spouses Julian GR No. 160408, January 11, 2016 Doctrines: 1. The creditor is prohibited from appropriating the things given by way of pledge or mortgage, or from disposing them. Any stipulation to the contrary is null and void. 2. No interest shall be due unless it has been expressly stipulated in writing. In order for monetary interest to be imposed, the following requirements must be present: (1) that there has been an express stipulation for the payment of interest; and (2) that the agreement for the payment of interest has been reduced in writing.

Facts: The Spouses Julian obtained a loan from Adelaida Pen. Two promissory notes were executed and as security, a Real Estate Mortgage was also executed. When the loans became due, the Julians failed to pay despite several demands. As such, Adelaida instituted foreclosure proceedings. The Julians offered their mortgaged property as payment in kind. Thereafter, they executed a Deed of Sale and the title to the property was transferred to Adelaida. The Julians however aver that at the time the mortgage was executed, they were required to sign an Absolute Deed of Sale, which did not contain any consideration. Upon verification with the Registry of Deeds, she was informed that the title to the mortgaged property had already been registered in the name of Adelaida. Spouses Julian filed a suit for the Cancellation of Sale, Cancellation of Title, recovery of possession and damages. The RTC ruled in favor of the respondents. On the other hand, the CA pronounced the deed of sale as void but not because of the supposed lack of consideration but because of it having been executed at the same time as the real estate mortgage, which rendered the sale as a prohibited pactum commissorium. It also ruled that the promissory notes contained no stipulation on the payment of interest, for which reason no monetary interest could be imposed for the use of money and that compensatory interest should instead be imposed as a form of damages arising from Linda’s failure to pay the outstanding obligation. Issues: 1. Whether the deed of sale is void for being a pactum commissorium 2. Whether no monetary interest was due for Linda’s use of Adelaida’s money. Ruling/Ratio: 1. Yes, the deed of sale is void for being pactum commissorium. Article 2088 of the Civil Code prohibits the creditor from appropriating the things given by way of pledge or mortgage, or from disposing them. Any stipulation to the contrary is null and void. The elements of pactum commissorium are as follows: (1) that there should be a pledge or mortgage wherein the property is pledged or mortgaged by way of security for the payment of the principal obligation; and (2) that there should be a stipulation for an automatic appropriation by the creditor of the thing pledged or mortgaged in the event of nonpayment of the principal obligation within the stipulation period. The first element was present considering that the property of the respondents was mortgaged by Linda in favor of Adelaida as security for the former’s indebtedness. As to the second, the authorization for Adelaida to appropriate the property subject of the mortgage upon default was implied from Linda’s having signed the blank deed of sale simultaneously with her signing of the real estate mortgage. The haste with which the transfer of property was made upon the default by Linda on her obligation, and the eventual transfer of the property in a manner not in the form of a valid dacion en pago ultimately confirmed the nature of the transaction as a pactum commissorium. 2. Yes, no monetary interest could be imposed for the use of money. Pursuant to Article 1956 of the Civil Code, no interest shall be due unless it has been expressly stipulated in writing. In order for monetary interest to be imposed, therefore, two requirements must be present: (1) that there has been an express stipulation for the payment of interest; and (2) that the agreement for the payment of interest has been reduced in writing. Considering that the promissory notes contained no stipulation on the payment of monetary interest, monetary interest cannot be validly imposed. TORTS AND DAMAGES Transportation Law Metro Manila Transit Corporation vs. Cuevas GR No. 167797, June 15, 2015 Doctrine: In case of motor vehicle mishaps, the registered owner of the vehicle is considered as the employer of the tortfeasor-driver, and is made primarily liable for tort committed by the latter. In so far as

third persons are concerned, the registered owner of the motor vehicle is the employer of the negligent driver, and the actual employer is considered merely as an agent of such owner. Facts: Metro Manila Transit Corporation (MMTC) and Mina’s Transit Corporation (Mina’s Transit) entered into an agreement to sell, whereby the latter bought several bus from the former. They agreed that MMTC would retain the ownership of the buses until certain conditions were met, but in the meantime Mina’s Transit could operate the buses. One of the buses hit and damaged a motorcycle owned by Reynaldo and driven by Junnel. Reynaldo and Junnel sued MMTC and Mina’s Transit for damages alleging that the defendants MMTC and Mina’s Transit are registered joint-owners or operators of an MMTC/Minas Transit passenger bus. MMTC denied liability and averred that although it retained the ownership of the bus, the actual operator and employer of the driver was Mina’s Transit; and that, in support of its cross-claim against Mina’s Transit, a provision in the agreement to sell mandated Mina’s Transport to hold it free from liability arising from the use and operation of the bus units. Issue: Whether MMTC is liable for the injuries sustained by the respondents despite the provision in the agreement to sell that shielded it from liability Ruling/Ratio: Yes, MMTC is liable. Under the registered-owner rule, the registered owner of the motor vehicle involved in a vehicular accident could be held liable for the consequences. In case of motor vehicle mishaps, the registered owner of the motor vehicle is considered as the employer of the tortfeasor-driver, and is made primarily liable for the tort committed by the latter under Article 2176, in relation with Article 2180, of the Civil Code. In so far as third persons are concerned, the registered owner of the motor vehicle is the employer of the negligent driver, and the actual employer is considered merely as an agent of such owner. Indeed, MMTC could not evade liability by passing the buck to Mina’s Transit. The stipulation in the agreement to sell did not bind third parties who were expected to simply rely on the data contained in the registration certificate of the erring bus. Although the registered-owner rule might seem to be unjust towards MMTC, the law did not leave it without any remedy or recourse. MMTC could recover from Mina’s Transit, the actual employer of the negligent driver, under the principle of unjust enrichment, by means of a cross-claim seeking reimbursement of all the amounts it could be required to pay as damages arising from the driver’s negligence. OBLIGATIONS AND CONTRACTS Megaworld Properties and Holdings, Inc. vs. Majestic Finance and Investment Co., Inc. GR No. 169694, December 9, 2015 Doctrine: Reciprocal obligations are those that arise from the same cause, and in which each party is a debtor and a creditor of the other at the same time, such that the obligations of one are dependent upon the obligations of the other. They are to be performed simultaneously, so that the performance by one is conditioned upon the simultaneous fulfillment by the other. Being reciprocal in nature, the respective obligations of the parties were dependent upon the performance by the other of its obligations; hence, any claim of delay or non-performance against the other could prosper only if the complaining party had faithfully complied with its own correlative obligation. Facts: Megaworld Properties and Holdings, Inc. (developer) entered into a Joint Venture Agreement (JVA) with Majestic Finance and Investment Co., Inc. (owner) for the development of the residential subdivision. The joint venture property would be for the sole account of the developer; and that upon completion of the subdivision, the owner would compensate the developer in the form of saleable residential subdivision lots. The JVA further provided that the developer would advance all the costs for the relocation and

resettlement of the occupants of the property, subject to reimbursement by the owner; and that the developer would deposit the initial amount of P10,000,000 to defray the expenses for the relocation and settlement, and the costs for obtaining the permits and clearances. The developer and owner agreed to an addendum to the JVA, to increase the initial deposit from P10,000,000 to P160,000,000. Subsequently, the developer assigned to Empire East Land Holdings, Inc. (developer/assignee) the JVA including the addendum. The owner filed a complaint for specific performance with damages against the developer, the assignee and Andrew Tan based on their failure to comply with their obligations under the JVA, including the obligation to maintain a strong security force to safeguard the entire joint venture property from illegal entrants and occupants. Issue: Whether petitioners are obligated to perform their obligations under the JVA, including that of providing round-the-clock security for the subject properties, despite respondents’ failure or refusal to acknowledge, or perform their reciprocal obligations Ruling/Ratio: No, petitioners are not obligated to perform their obligations under the JVA. The obligations of the parties under the JVA were reciprocal. Reciprocal obligations are those that arise from the same cause, and in which each party is a debtor and a creditor of the other at the same time, such that the obligations of one are dependent upon the obligations of the other. They are to be performed simultaneously, so that the performance by one is conditioned upon the simultaneous fulfillment by the other. For the first activity (i.e., the relocation of the occupants), the developer was obliged to negotiate with the occupants, to advance payment for disturbance compensation, and to relocate the occupants to an area within the subject land, while the owner was obliged to agree to and to allocate the resettlement site within the property, and to approve the expenses to be incurred for the process. Should the owner fail to allocate the site for the resettlement, the obligation of the developer to relocate would not be demandable. Conversely, should the developer fail to negotiate with the occupants, the owner's obligation to allocate the resettlement site would not become due. As to the second activity (i.e., the completion of the development plan), the developer had the obligation to lay out the plan, but the owner needed to conform to the plan before the same was finalized. Accordingly, the final development plan would not be generated should the owner fail to approve the lay-out plan; nor would the owner be able to approve if no such plan had been initially laid out by the developer. In each activity, the obligation of each party was dependent upon the obligation of the other. Although their obligations were to be performed simultaneously, the performance of an activity obligation was still conditioned upon the fulfillment of the continuous obligation, and vice versa. Should either party cease to perform a continuous obligation, the other's subsequent activity obligation would not accrue. Conversely, if an activity obligation was not performed by either party, the continuous obligation of the other would cease to take effect. The performance of the continuous obligation was subject to the resolutory condition that the precedent obligation of the other party, whether continuous or activity, was fulfilled as it became due. Otherwise, the continuous obligation would be extinguished. Being reciprocal in nature, their respective obligations as the owner and the developer were dependent upon the performance by the other of its obligations; hence, any claim of delay or non-performance against the other could prosper only if the complaining party had faithfully complied with its own correlative obligation.

LAW ON SUCCESSION Heirs of Arado vs. Alcoran GR No. 163362, July 8, 2015 Doctrines: 1. An acknowledged illegitimate child is entitled to inherit from the estate of his/her putative father. 2. An illegitimate child has no right to inherit ab intestate from the legitimate children and relatives of his father or mother. In the same manner, such children or relatives shall not inherit from the illegitimate child. The right of representation is not available to illegitimate descendants of legitimate children in the inheritance of a legitimate grandparent. 3. No will shall pass either real or personal property unless the same is proved and allowed in accordance with the Rules of Court. In order that a will may take effect, it has to be probated, legalized or allowed in the proper testamentary proceeding. The probate of the will is mandatory. Facts: Raymundo Alcoran was married to Joaquina Arado, and begot a son named Nicolas Alcoran. Nicolas married Florencia. Nicolas had an extramarital affair with Francisca, who gave birth to respondent Anacleto Alcoran. Anacleto married Elenette Sonjaco. Raymundo died in 1939, while Nicolas died in 1954. Florencia died in 1960, and Joaquina died in 1981. The petitioners (Joaquina’s siblings and their heirs) filed a complaint for recovery of property and damages against Anacleto and Elenette, alleging among others that when Nicolas died in 1954 without issue, half of his properties were inherited by his wife, Florencia, and the other half by his mother, Joaquina; that Nicolas did not recognize Anacleto as his spurious child during Nicolas’ lifetime; hence, Anacleto was not entitled to inherit from Nicolas; that Anacleto claimed entitlement to the properties as the heir of Nicolas and by virtue of the will executed by Joaquina; that the will was void for not having been executed according to the formalities of the law and was not submitted for probate. Respondents countered that Anacleto was expressly recognized by Nicolas as the latter’s son in his birth certificate. They also alleged that Joaquina executed a last will and testament in Anacleto’s favor and Joaquina’s possession of the properties was for and in behalf of Anacleto. Issues: 1. Whether Anacleto is a recognized illegitimate son of Nicolas 2. Whether Anacleto is entitled to the properties of Nicolas and Joaquina Ruling/Ratio: 1. Yes, Anacleto is a recognized illegitimate son of Nicolas. Article 175 of the Family Code provides that illegitimate children may establish their illegitimate filiation in the same way and on the same evidence as legitimate children. Article 172 provides that the filiation of legitimate children is established by, among others, the record of birth appearing in the civil register or a final judgment. The birth certificate of Anacleto showed that Nicolas himself caused the registration of the birth of Anacleto. Considering that Nicolas had a direct hand in the preparation of the birth certificate, reliance on the birth certificate of Anacleto as evidence of paternity was fully warranted. 2. Anacleto is entitled to the properties of Nicolas, but not of Joaquina. Under the Old Civil Code (which was in effect when Nicolas died), the heirs entitled to inherit from Nicolas’s estate were Joaquina (his mother), Florencia (his surviving spouse), and Anacleto (his acknowledged illegitimate son). Said heirs became co-owners of the properties comprising the entire estate of Nicolas. When Joaquina died, she had no surviving legitimate descendant, ascendant, illegitimate child or spouse. In such case, Article 1003 of the Old Civil Code mandated that her collateral relatives should inherit her entire estate. Anacleto cannot inherit from the estate of Joaquina by right of representation Under Article 992 of the Civil Code, an illegitimate child has no right to inherit ab intestate from the

legitimate children and relatives of his father or mother. In the same manner, such children or relatives shall not inherit from the illegitimate child. The right of representation is not available to illegitimate descendants of legitimate children in the inheritance of a legitimate grandparent. Moreover, Anacleto could not inherit by virtue of Joacquina’s last will and testament. Article 383 of the Civil Code dictates that no will shall pass either real or personal property unless the same is proved and allowed in accordance with the Rules of Court. In order that a will may take effect, it has to be probated, legalized or allowed in the proper testamentary proceeding. The probate of the will is mandatory. It appears that the will remained ineffective considering that the records are silent as to whether it had ever been presented for probate, and had been allowed by a court of competent jurisdiction.

TAXATION DEDUCTIONS FROM GROSS INCOME H. Tambunting Pawnshop Inc. vs. Commissioner of Internal Revenue G.R. No. 173373, July 29, 2013 Doctrine: To be entitled to claim a tax deduction, the taxpayer must competently establish the factual and documentary bases of its claim. Facts: Tambunting Pawnshop was assessed with deficiency income tax by the BIR by disallowing certain deductions on its gross income. The BIR alleged that these deductions were not duly substantiated. First, the loss on auction sale was only supported by entries on the Company’s internal records, i.e., the “Subasta”, “Rematado” and “Schedule of Losses on Auction Sale”, which are not proper documents to prove actual loss. Only lessor’s certification, withholding tax returns, cash vouchers and contract of lease and no official receipts were submitted to support the security and janitorial expenses, management and professional fees, and rental expenses. As to the proof of loss due to fire, the Company did not submit the required sworn declaration for such casualty loss to the BIR mandated by RR 12-77. Issue/s: Whether the petitioner is entitled to tax deductions Ruling/Ratio: No, the rule that tax deductions, being in the nature of tax exemptions, are to be construed in strictissimi juris against the taxpayer is well settled. Corollary to this rule is the principle that when a taxpayer claims a deduction, he must point to some specific provision of the statute in which that deduction is authorized and must be able to prove that he is entitled to the deduction which the law allows. An item of expenditure, therefore, must fall squarely within the language of the law in order to be deductible. A mere averment that the taxpayer has incurred a loss does not automatically warrant a deduction from its gross income. The requisites for the deductibility of ordinary and necessary trade or business expenses, like those paid for security and janitorial services, management and professional fees, and rental expenses, are that: (a) the expenses must be ordinary and necessary; (b) they must have been paid or incurred during the taxable year; (c) they must have been paid or incurred in carrying on the trade or business of the taxpayer; and (d) they must be supported by receipts, records or other pertinent papers. Deductions for income tax purposes partake of the nature of tax exemptions and are strictly construed against the taxpayer, who must prove by convincing evidence that he is entitled to the deduction claimed. Tambunting did not discharge its burden of substantiating its claim for deductions due to the inadequacy of the documentary support of its claim. Its reliance on withholding tax returns, cash vouchers, lessor’s certifications, and the contracts of lease was futile because such documents had scant probative value. As the CTA En Banc succinctly put it, the law required Tambunting to support its claim for deductions with the corresponding official receipts issued by the service providers concerned. REFUND OR TAX CREDIT OF EXCESS INPUT TAX Luzon Hydro Corp. vs. CIR G.R. No. 188260, November 13, 2013 Doctrine: To be able to claim refund on the basis of zero-rated sales, taxpayer must prove the existence of zero-rated sales though its VAT returns and receipts issued for such zero-rated sales.

Facts: The petitioner, a producer of electricity, has been registered with the BIR as a VAT taxpayer. Pursuant to its Power Purchase Agreement entered into with the National Power Corporation (NPC), the electricity produced by the petitioner was to be sold exclusively to NPC. Relative to its sale to NPC, the petitioner was granted by the BIR certificates for Zero Rate for VAT purposes in the periods from January 1, 2000 to December 31, 2001. The petitioner alleged that it had incurred input VAT on its domestic purchases of goods and services used in its generation and sales of electricity to NPC in the four quarters of 2001; and that it had declared the input VAT in its amended VAT returns. Petitioner filed a written claim for refund or tax credit relative to those unutilized input VAT. Respondent CIR did not ultimately act on the petitioner’s claim. Hence, the petitioner filed its petition for review in the CTA. Issue/s: Whether the petitioner is entitled to input VAT refund Ruling/Ratio: No, a claim for refund or tax credit for unutilized input VAT may be allowed only if the following requisites concur, namely: (a) the taxpayer is VAT-registered; (b) the taxpayer is engaged in zero-rated or effectively zero-rated sales; (c) the input taxes are due or paid; (d) the input taxes are not transitional input taxes; (e) the input taxes have not been applied against output taxes during and in the succeeding quarters; (f) the input taxes claimed are attributable to zero-rated or effectively zero-rated sales; (g) for zero-rated sales under Section 106(A)(2)(1) and (2); 106(B); and 108(B)(1) and (2), the acceptable foreign currency exchange proceeds have been duly accounted for in accordance with the rules and regulations of the Bangko Sentral ng Pilipinas; (h) where there are both zero-rated or effectively zerorated sales and taxable or exempt sales, and the input taxes cannot be directly and entirely attributable to any of these sales, the input taxes shall be proportionately allocated on the basis of sales volume; and (i) the claim is filed within two years after the close of the taxable quarter when such sales were made. Petitioner did not produce evidence showing that it had zero-rated sales for the four quarters of taxable year 2001. As the CTA En Banc precisely found, the petitioner did not reflect any zero-rated sales from its power generation in its four quarterly VAT returns, which indicated that it had not made any sale of electricity. Petitioner’s assertion that its sale of electricity to NPC was automatically zero-rated pursuant to Republic Act No. 9136 (EPIRA Law); hence, it need not prove that it had zero-rated sales of electricity by presenting the VAT official receipts and VAT returns cannot be upheld. JURISDICTION OF THE CTA Commissioner of Customs vs. Oilink International Corporation G.R. No. 161759, July 02, 2014 Doctrine: The principle of non-exhaustion of administrative remedies was not an iron-clad rule because there were instances in which the immediate resort to judicial action was proper. Facts: URC and Oilink had interlocking directors when Oilink started its business. Customs Commissioner formally directed that URC pay the special duties, VAT, and Excise Taxes that it had failed to pay. URC denied liability, insisting instead that only a lower amount should be paid by way of compromise, which was rejected by the Commissioner. URC’s President conveyed to the Commissioner URC’s willingness to pay of which the initial amount would be taken from the collectibles of Oilink. On July 2, 1999, the Commissioner made a final demand upon URC and Oilink. Also on July 8, 1999, Oilink formally protested the assessment on the ground that it was not the party liable for the assessed deficiency taxes.

On July 12, 1999, the Commissioner stressed that the Bureau of Customs (BoC) would not issue any clearance to Oilink unless the amount demanded as Oilink’s tax liability be first paid. On July 30, 1999, Oilink appealed to the CTA. The CTA rendered its decision declaring as null and void the assessment of the Commissioner. Aggrieved, the Commissioner brought a petition for review in the CA. The Commissioner posits that Oilink did not exhaust its administrative remedies under Section 2308 of the Tariff and Customs Code by paying the assessment under protest; that the CTA should not take cognizance of the case because of the lapse of the 30-day period within which to appeal, arguing that on November 25, 1998 URC had already received the BoC’s final assessment demanding payment of the amount due within 10 days, but filed the petition only on July 30, 1999. As to whether or not the Commissioner could lawfully pierce the veil of corporate fiction in order to treat Oilink as the mere alter ego of URC, the CA concurred with the CTA that the corporate veil could not be pierced. Issue/s: 1. Whether the CTA had jurisdiction over the subject matter 2. Whether Oilink had a cause of action 3. Whether the Commissioner could pierce the veil of corporate fiction Ruling/Ratio: 1. Yes, R.A. No. 1125, the law creating the CTA, defined the appellate jurisdiction of the CTA which includes decisions of the Commissioner of Customs in cases involving liability for customs duties, fees or other money charges; fines, forfeitures or other penalties imposed in relation thereto; or other matters arising under the Customs Law or other law or part of law administered by the BOC. The CTA correctly ruled that the reckoning date for Oilink’s appeal was July 12, 1999, not July 2, 1999, because it was on the former date that the Commissioner denied the protest of Oilink. Clearly, the filing of the petition on July 30, 1999 by Oilink was well within its reglementary period to appeal. The insistence by the Commissioner on reckoning the reglementary period to appeal from November 25, 1998, the date when URC received the final demand letter, is unwarranted. The November 25, 1998 final demand letter of the BoC was addressed to URC, not to Oilink. As such, the final demand sent to URC did not bind Oilink unless the separate identities of the corporations were disregarded in order to consider them as one. 2.

Yes, the principle of non-exhaustion of administrative remedies was not an iron-clad rule because there were instances in which the immediate resort to judicial action was proper. This was one such exceptional instance when the principle did not apply. As the records indicate, the Commissioner already decided to deny the protest by Oilink on July 12, 1999, and stressed then that the demand to pay was final. In that instance, the exhaustion of administrative remedies would have been an exercise in futility because it was already the Commissioner demanding the payment of the deficiency taxes and duties.

3.

No, the doctrine of piercing the corporate veil has no application here because the Commissioner did not establish that Oilink had been set up to avoid the payment of taxes or duties, or for purposes that would defeat public convenience, justify wrong, protect fraud, defend crime, confuse legitimate legal or judicial issues, perpetrate deception or otherwise circumvent the law. It is also noteworthy that from the outset the Commissioner sought to collect the deficiency taxes and duties from URC, and that it was only on July 2, 1999 when the Commissioner of Customs sent the demand letter to both URC and Oilink. That was revealing, because the failure of the Commissioner to pursue the remedies against Oilink from the outset manifested that its belated pursuit of Oilink was only an afterthought.

POWER OF THE BOC Agriex Co. Ltd. vs. Hon. Titus Villanueva G.R. No. 158150, September 10, 2014 Doctrine: Both the SBMA and the BOC have the power to seize and forfeit goods or articles entering the Subic Bay Freeport, except that SBMA’s authority to seize and forfeit goods or articles entering the Subic Bay Freeport has been limited only to cases involving violations of RA No. 7227 or its IRR. There is no question therefore, that the authority of the BOC is larger in scope because it covers cases concerning violations of the customs laws. The authority of the BOC to seize and forfeit goods and articles entering the Subic Bay Freeport does not contravene the nature of the Subic Bay Freeport as a separate customs authority. Facts: The petitioner, a foreign corporation, entered into a contract of sale with PT. Gloria Mitra of Surabaya, Indonesia for 180,000 bags of Thai white rice. Later on, it entered into another contract of sale with R&C Agro Trade of Cebu City for 20,000 bags of Thai white rice. It chartered the vessel MV Hung Yen to transport the 200,000 bags of Thai white rice to the Subic Free Port for transshipment to their designated consignees in the Fiji Islands and Indonesia (for the 180,000 bags), and in Cebu City (for the 20,000 bags). The Collector of Customs issued Warrant of Seizure and Detention (WSD) against the 20,000 bags of Thai white rice, MV Hung Yen, and the remaining 180,000 bags of Thai white rice intended for transshipment. The petitioner filed with the BoC an Urgent Motion to Quash the WSD. The Collector quashed WSD over the MV Hung Yen on the ground that the vessel was not chartered or leased but denied the motion for the quashal of the warrant of seizure issued against the rice shipments. The Commissioner granted the motion for settlement and accordingly ordered the release of the 20,000 bags of Thai rice to claimants. Thereafter, the Commissioner directed the sale of the 180,000 bags of Thai white rice at public auction. The petitioner claims that the Collector of Customs had no jurisdiction to issue WSD and the Notice of Sale concerning the 180,000 bags of Thai white rice, which had entered the SBF only for transshipment to other countries. It insists that the auction sale of the 180,000 bags was null and void. Issue/s: Whether the Collector of Customs has jurisdiction to hear and determine questions involving the seizure and forfeiture of dutiable goods Ruling/Ratio: Yes, the Collector of Customs was authorized to institute seizure proceedings and to issue WSDs in the Subic Bay Freeport, subject to the review by the Commissioner of Customs. Accordingly, the proper remedy to question the order or resolution of the Commissioner of Customs was an appeal to the CTA, not to the CA. Both the SBMA and the BOC have the power to seize and forfeit goods or articles entering the Subic Bay Freeport, except that SBMA’s authority to seize and forfeit goods or articles entering the Subic Bay Freeport has been limited only to cases involving violations of RA No. 7227 or its IRR. There is no question therefore, that the authority of the BOC is larger in scope because it covers cases concerning violations of the customs laws. The authority of the BOC to seize and forfeit goods and articles entering the Subic Bay Freeport does not contravene the nature of the Subic Bay Freeport as a separate customs authority. Indeed, the investors can generally and freely engage in any kind of business as well as import into and export out goods with minimum interference from the Government.

The treatment of the Subic Bay Freeport as a separate customs territory cannot completely divest the Government of its right to intervene in the operations and management of the Subic Bay Freeport, especially when patent violations of the customs and tax laws are discovered. After all, Section 602 of the Tariff and Customs Code vests exclusive original jurisdiction in the BOC over seizure and forfeiture cases in the enforcement of the tariff and customs laws. In this case, an examination of the shipment by the customs officials pursuant to Mission Order initially revealed no cause to hold the release of the 180,000 bags of rice. However, further investigation led to the discovery that the consignees of the 180,000 bags of rice in Indonesia were non-existent, and the consignee in the Fiji Islands denied being involved in the importation of rice. EXCISE TAX Chevron Philippines Inc. vs. Commissioner of Internal Revenue G.R. No. 210836, September 1, 2015 Doctrine: Excise tax on petroleum products is essentially a tax on property, the direct liability for which pertains to the statutory taxpayer (i.e., manufacturer, producer or importer). Any excise tax paid by the statutory taxpayer on petroleum products sold to any of the entities or agencies named in Section 135 of the National Internal Revenue Code (NIRC) exempt from excise tax is deemed illegal or erroneous, and should be credited or refunded to the payor pursuant to Section 204 of the NIRC. This is because the exemption granted under Section 135 of the NIRC must be construed in favor of the property itself, that is, the petroleum products. Facts: Chevron sold and delivered petroleum products to Clark Development Corporation (CDC). Chevron did not pass on to CDC the excise taxes paid on the importation of the petroleum products sold to CDC; hence, it filed an administrative claim for tax refund or issuance of tax credit certificate. Since the CIR did not act on the administrative claim for tax refund or tax credit, Chevron elevated its claim to the CTA by petition for review. The CTA First Division denied Chevron’s judicial claim for tax refund or tax credit. Chevron appealed to the CTA En Banc which affirmed the ruling of the CTA First Division, stating that there was nothing in Section 135(c) of the NIRC that explicitly exempted Chevron as the seller of the imported petroleum products from the payment of the excise taxes; and holding that because it did not fall under any of the categories exempted from paying excise tax, Chevron was not entitled to the tax refund or tax credit. Issue/s: Whether Chevron was entitled to the tax refund or the tax credit for the excise taxes paid on the importation of petroleum products that it had sold to CDC Ruling/Ratio: Yes, under Section 129 of the NIRC, as amended, excise taxes are imposed on two kinds of goods, namely: (a) goods manufactured or produced in the Philippines for domestic sales or consumption or for any other disposition; and (b) things imported. Undoubtedly, the excise tax imposed under Section 129 of the NIRC is a tax on property. With respect to imported things, Section 131 of the NIRC declares that excise taxes on imported things shall be paid by the owner or importer to the Customs officers, conformably with the regulations of the DOF and before the release of such articles from the customs house, unless the imported things are exempt from excise taxes and the person found to be in possession of the same is other than those legally entitled to such tax exemption. For this purpose, the statutory taxpayer is the importer of the things subject to excise tax. Chevron, being the statutory taxpayer, paid the excise taxes on its importation of the petroleum products. Pursuant to Section 135(c), petroleum products sold to entities that are by law exempt from direct and indirect taxes are exempt from excise tax. The phrase which are by law exempt from direct and indirect

taxes describes the entities to whom the petroleum products must be sold in order to render the exemption operative. Section 135(c) should thus be construed as an exemption in favor of the petroleum products on which the excise tax was levied in the first place. The exemption cannot be granted to the buyers – that is, the entities that are by law exempt from direct and indirect taxes – because they are not under any legal duty to pay the excise tax. In cases involving excise tax exemptions on petroleum products under Section 135 of the NIRC, the Court has consistently held that it is the statutory taxpayer, not the party who only bears the economic burden, who is entitled to claim the tax refund or tax credit. But the Court has also made clear that this rule does not apply where the law grants the party to whom the economic burden of the tax is shifted by virtue of an exemption from both direct and indirect taxes. In which case, such party must be allowed to claim the tax refund or tax credit even if it is not considered as the statutory taxpayer under the law. The general rule applies here because Chevron did not pass on to CDC the excise taxes paid on the importation of the petroleum products, the latter being exempt from indirect taxes by virtue of Section 24 of R.A. No. 7916, in relation to Section 15 of R.A. No. 9400, not because Section 135(c) of the NIRC exempted CDC from the payment of excise tax. SUSPENSION OF COLLECTION OF TAX Tridharma Marketing Corporation vs. Court of Tax Appeals G.R. No. 215950, June 20, 2016 Doctrine: CTA may order the suspension of the collection of taxes provided that the taxpayer either: (1) deposits the amount claimed; or (2) files a surety bond for not more than double the amount. Facts: Petitioner received a Preliminary Assessment Notice (PAN) from the BIR assessing it with various deficiency. A substantial portion of the deficiency income tax and VAT arose from the complete disallowance by the BIR of the petitioner's purchases from Etheria Trading. Petitioner received from the BIR a Formal Letter of Demand (FLD). It filed a protest against the FLD. Respondent CIR required the petitioner to submit additional documents in support of its protest, and the petitioner complied. Petitioner received a Final Decision on Disputed Assessment (FDDA). Petitioner filed with the CIR a protest through a Request for Reconsideration. However, the CIR rendered a decision denying the request for reconsideration. Petitioner appealed the CIR’s decision to the CTA via Petition for Review with Motion to Suspend Collection of Tax. The CTA in Division required petitioner to deposit a surety bond equivalent to 150% of the assessment. Issue/s: Whether the CTA Division committed grave abuse of discretion in requiring the petitioner to file a surety bond despite the supposedly patent illegality of the assessment that was beyond the petitioner's net worth but equivalent to the deficiency assessment for IT and VAT Ruling/Ratio: Yes, CTA may order the suspension of the collection of taxes provided that the taxpayer either: (1) deposits the amount claimed; or (2) files a surety bond for not more than double the amount. The Court holds that the CTA in Division gravely abused its discretion under Section 11 or RA 1125 because it fixed the amount of the bond at nearly five times the net worth of the petitioner without conducting a preliminary hearing to ascertain whether there were grounds to suspend the collection of the deficiency assessment on the ground that such collection would jeopardize the interests of the taxpayer. It behooved the CTA in Division to consider other factors recognized by the law itself towards suspending the collection of the assessment, like whether or not the assessment would jeopardize the interest of the taxpayer, or whether the means adopted by the CIR in determining the liability of the taxpayer was legal and valid. Simply prescribing such high amount of the bond like the initial 150% of the deficiency

assessment or later on even reducing the amount of the bond to equal the deficiency assessment would practically deny to the petitioner the meaningful opportunity to contest the validity of the assessments, and would likely even impoverish it as to force it out of business. Section 11 of R.A. 1125, as amended, indicates that the requirement of the bond as a condition precedent to suspension of the collection applies only in cases where the processes by which the collection sought to be made by means thereof are carried out in consonance with the law, not when the processes are in plain violation of the law that they have to be suspended for jeopardizing the interests of the taxpayer. REFUND OR TAX CREDIT OF EXCESS INPUT TAX; VAT EXEMPTION; PEZA LAW Coral Bay Nickel Corporation vs. Commissioner of Internal Revenue G.R. No. 190506, June 13, 2016 Doctrine: PEZAregistered enterprises, which would necessarily be located within ECOZONES, are VATexempt entities, not because of Section 24 of R.A. No. 7916, as amended, which imposes the 5% preferential tax rate on gross income of PEZA registered enterprises, in lieu of all taxes; but rather, because of Section 8 of the same statute which establishes the fiction that ECOZONES are foreign territory. Facts: Petitioner is a VAT entity registered with the BIR and also registered with PEZA as an Ecozone Export Enterprise. Petitioner filed its Amended VAT Return declaring unutilized input tax prior to its registration with PEZA as Ecozone Export Enterprise. It filed with Revenue District Office in Palawan its Application for Tax Credits/Refund. The CTA in Division promulgated its decision denying the petitioner’s claim for refund. Issue/s: Whether the petitioner, an entity located within an ECOZONE, is entitled to the refund of its unutilized input taxes incurred before it became a PEZA-registered entity Ruling/Ratio: No, Section 8 of R.A. No. 7916 mandates that PEZA shall manage and operate the ECOZONE as a separate customs territory. The provision thereby establishes the fiction that an ECOZONE is a foreign territory separate and distinct from the customs territory. Accordingly, the sales made by suppliers from a customs territory to a purchaser located within an ECOZONE will be considered as exportations. Following the Philippine VAT system’s adherence to the Cross Border Doctrine and Destination Principle, the VAT implications are that “no VAT shall be imposed to form part of the cost of goods destined for consumption outside of the territorial border of the taxing authority.” Moreover, RMC No. 7499 categorically declared that all sales of goods, properties, and services made by a VAT registered supplier from the Customs Territory to an ECOZONE enterprise shall be subject to VAT, at zero percent (0%) rate, regardless of the latter’s type or class of PEZA registration; and, thus, affirming the nature of a PEZAregistered or an ECOZONE enterprise as a VATexempt entity. The petitioner’s principal office was located in Barangay Rio Tuba, Bataraza, Palawan. Its plant site was specifically located inside the Rio Tuba Export Processing Zone — a special economic zone (ECOZONE). As such, the purchases of goods and services by the petitioner that were destined for consumption within the ECOZONE should be free of VAT; hence, no input VAT should then be paid on such purchases, rendering the petitioner not entitled to claim a tax refund or credit.

CRIMINAL LAW RECKLESS IMPRUDENCE; MITIGATING CIRCUMSTANCE; LESS GRAVE FELONY; PENALTY Reynaldo Mariano vs. People of the Philippines G.R. No. 178145, July 07, 2014 Doctrine: 1. Reckless imprudence consists in voluntary, but without malice, doing or failing to do an act from which material damage results by reason of inexcusable lack of precaution on the part of the person performing or failing to perform such act, taking into consideration his employment or occupation, degree of intelligence, physical condition and other circumstances regarding persons, time and place.” To constitute the offense of reckless driving, the act must be something more than a mere negligence in the operation of the motor vehicle, but a willful and wanton disregard of the consequences is required. 2.

The rules in Article 64 of the RPC are not applicable in reckless imprudence. Par. 5 of Art. 365, RPC, expressly states that in the imposition of the penalties, the courts shall exercise their sound discretion, without regard to the rules prescribed in Article 64 of the Revised Penal Code.

Facts: Accused-appellant Reynaldo and his wife, Rebecca, tried to show that the jeep of Ferdinand stopped on the road in front of the house of the latter’s mother about 5 to 6 meters away from their pick-up. Reynaldo stopped the pick-up as he saw an oncoming vehicle, which he allowed to pass. Thereafter, Reynaldo made a signal and overtook the jeep of Ferdinand. However, Ferdinand suddenly alighted from his jeep, lost his balance and was sideswiped by the overtaking pick-up. Reynaldo did not stop his pick-up and he proceeded on his way for fear that the bystanders might harm him and his companions. After bringing his companions to their house in Marungko, Angat, Bulacan, Reynaldo proceeded to Camp Alejo S. Santos in Malolos, Bulacan to surrender and report the incident. The RTC convicted the petitioner of frustrated homicide. On appeal, the CA promulgated its assailed decision modifying the felony committed by the petitioner from frustrated homicide to reckless imprudence resulting in serious physical injuries, imposing a penalty of 2 months and 1 day of arresto mayor, as minimum, to 1 year, 7 months and 11 days of prision correccional, as maximum. In this appeal, the petitioner argues that his guilt for any crime was not proved beyond reasonable doubt, and claims that Ferdinand’s injuries were the result of a mere accident. He insists that he lacked criminal intent; that he was not negligent in driving his pick-up truck; and that the CA should have appreciated voluntary surrender as a mitigating circumstance in his favor. Issue/s: 1. Whether or not the conviction for the crime of reckless imprudence resulting in serious physical injuries should be upheld 2. Whether the mitigating circumstance should be appreciated 3. Whether the penalty imposed by the CA is proper Ruling/Ratio: 1. Yes. We affirm the conviction of the petitioner for reckless imprudence resulting in serious physical injuries. As aptly observed by the court a quo, only a vehicle that is moving beyond the normal rate of speed and within the control of the driver’s hands could have caused Ferdinand’s injuries. The very fact of speeding is indicative of imprudent behavior, as a motorist must exercise ordinary care and drive at a reasonable rate of speed commensurate with the conditions encountered, which will enable him or

her to keep the vehicle under control and avoid injury to others using the highway. Thus, had Reynaldo not driven his pick-up at a fast speed in overtaking the jeep of Ferdinand, he could have easily stopped his pick-up or swerved farther to the left side of the road, as there was no oncoming vehicle, when he saw that Ferdinand alighted from his jeep and lost his balance, in order to avoid hitting the latter or, at least, minimizing his injuries. The findings by the CA are controlling on the Court. Indeed, the findings of both lower courts on the circumstances that had led to the injuries of Ferdinand fully converged except for the RTC’s conclusion that malicious intent had attended the commission of the offense. Reckless imprudence consists involuntary, but without malice, doing or failing to do an act from which material damage results by reason of inexcusable lack of precaution on the part of the person performing of failing to perform such act, taking intoconsideration his employment or occupation, degree of intelligence, physical condition and other circumstances regarding persons, time and place." To constitute the offense of reckless driving, the act must be something more than a mere negligence in the operation of the motor vehicle, but a willful and wanton disregard of the consequences is required. The Prosecution must further show the direct causal connection between the negligence and the injuries or damages complained of. 2.

No. Contrary to the petitioner’s insistence, the mitigating circumstance of voluntary surrender cannot be appreciated in his favor. Par. 5 of Art. 365, RPC, expressly states that in the imposition of the penalties, the courts shall exercise their sound discretion, without regard to the rules prescribed in Article 64 of the Revised Penal Code. The rationale of the law can be found in the fact that in quasioffenses penalized under Article 365, the carelessness, imprudence or negligence which characterizes the wrongful act may vary from one situation to another, in nature, extent, and resulting consequences, and in order that there may be a fair and just application of the penalty, the courts must have ample discretion in its imposition, without being bound by what we may call the mathematical formula provided for in Art. 64 of the RPC. On the basis of this particular provision, the trial court was not bound to apply par. 5 of Art. 64 in the instant case even if appellant had two mitigating circumstances in his favor with no aggravating circumstance to offset them.

3.

No. The CA erred in imposing on the petitioner the penalty for reckless imprudence resulting in serious physical injuries. The penalty for the offender guilty of reckless imprudence is based on the gravity of the resulting injuries had his act been intentional. Thus, Art. 365 of the RPC stipulates that had the act been intentional, and would constitute a grave felony, the offender shall suffer arresto mayor in its maximum period to prision correccional in its medium period; if it would have constituted a less grave felony, arresto mayor in its minimum and medium periods shall be imposed; and if it would have constituted a light felony, arresto menor in its maximum period shall be imposed. Pursuant to Art. 9 of the RPC, a grave felony is that to which the law attaches the capital punishment or a penalty that in any of its periods is afflictive in accordance with Art. 25 of the RPC; a less grave felony is that which the law punishes with a penalty that is correctional in its maximum period in accordance with Art. 25 of the RPC; and a light felony is an infraction of law for the commission of which a penalty of either arresto menor or a fine not exceeding P200, or both is provided. In turn, Art. 25 of the RPC enumerates the principal afflictive penalties to be reclusion perpetua, reclusion temporal, and prision mayor; the principal correctional penalties to be prision correccional, arresto mayor, suspension and destierro; and the light penalties to be arresto menor and fine not exceeding P200. Under this provision, death stands alone as the capital punishment. Art. 263 of the RPC classifies the felony of serious physical injuries based on the gravity of the physical injuries. (See Art. 263) The CA found that Ferdinand had sustained multiple facial injuries, a fracture of the inferior part of the right orbital wall, and subdural hemorrhage secondary to severe head trauma; that he had become stuporous and disoriented as to time, place and person. He was

unable to attend to his general merchandise store for 3 months due to temporary amnesia; and that he had required the attendance of caregivers and a masseur until October 31, 1999. With Ferdinand not becoming insane, imbecile, impotent, or blind, his physical injuries did not fall under Art. 263 (1). Consequently, the CA incorrectly considered the petitioner’s act as a grave felony had it been intentional, and should not have imposed the penalty at arresto mayor in its maximum period to prision correccional in its medium period. Instead, the petitioner’s act that caused the serious physical injuries, had it been intentional, would be a less grave felony under Art. 25 of the RPC, because Ferdinand’s physical injuries were those under Art. 263 (3) for having incapacitated him from the performance of the work in which he was habitually engaged in for more than 90 days. Conformably with Art. 365 of the RPC, the proper penalty is arresto mayor in its minimum and medium periods, which ranges from 1 to 4 months. As earlier mentioned, the rules in Art. 64 of the RPC are not applicable in reckless imprudence, and considering further that the maximum term of imprisonment would not exceed 1 year, rendering the Indeterminate Sentence Law inapplicable, the Court holds that the straight penalty of 2 months of arresto mayor was the correct penalty for the petitioner. MALVERSATION OF PUBLIC FUNDS THROUGH FALSIFICATION OF PUBLIC DOCUMENT; PENALTY; INDETERMINATE SENTENCE LAW Manolito Zafra vs. People of the Philippines G.R. No. 176317, July 23, 2014 Doctrine: In convicting an accused of the complex crime of malversation of public funds through falsification of a public document, the courts shall impose the penalty for the graver felony in the maximum period pursuant to Art. 48 of the RPC, plus fine in the amount of the funds malversed or the total value of the property embezzled. In addition, the courts shall order the accused to return to the Government the funds malversed, or the value of the property embezzled. Facts: Appellant was the Revenue Collection Agent of the BIR, Revenue District 3, in San Fernando, La Union from 1993-1995. Among his duties was to receive tax payments for which revenue official receipts (ROR) were issued. The original of the ROR was then given to the taxpayer while a copy thereof was retained by the collection officer. On 06 July 1995, an audit team from BIR central office was tasked to audit the cash and non-cash accountabilities of the appellant. Among the documents reviewed by the audit team were the Certificate Authorizing Registration (CARs); triplicate copies of the RORs; and appellant’s monthly report of collections (MRCs). The audit team likewise requested and was given copies of the RORs issued to the La Union branch of the Philippine National Bank (PNB). A comparison of the entries in said documents revealed that the data pertaining to 18 RORs with the same serial number vary with respect to the name of the taxpayer, the kind of tax paid, the amount of tax and the date of payment. Of particular concern to the audit team were the lesser amounts of taxes reported in appellant’s MRCs and the attached RORs compared to the amount reflected in the CARs and PNB’s RORs. Although the RORs bear the same serial numbers, the total amount reflected in the CARs and PNB’s 12 copies of RORs is PhP615,493.93, while only Php1,342.00 was reported as tax collections in the RORs’ triplicate copies submitted by appellant to COA and in his MRCs, or a discrepancy of Php614,151.93, Thus, the audit team sent to appellant a demand letter requiring him to restitute the total amount of Php614,151.93. Appellant ignored the letter, thus, prompting the institution of the 18 cases for malversation of public funds through falsification of public document against him. The RTC convicted the petitioner of 18 counts of malversation of public funds through falsification of public documents. The CA affirmed the conviction of the petitioner and the penalties imposed by the RTC.

The petitioner contends that the RTC and the CA erroneously convicted him of several counts of malversation of public funds through falsification of public documents on the basis of the finding that he had been negligent in the performance of his duties; that the acts imputed to him did not constitute negligence; and that he could not be convicted of intentional malversation and malversation through negligence at the same time. Issue/s: 1. Whether the conviction of the petitioner for several counts of malversation of public funds through falsification of public documents should be upheld 2. Whether the penalty imposed is proper Ruling/Ratio: 1. Yes. The RTC noted that there is a big disparity between the amount covered by RORs issued to the taxpayer, and the amount for the same receipt number appearing in the MCRs indicating the falsification resorted to by the accused in the official reports he filed, thereby remitting less than what was collected from taxpayers concerned, resulting to the loss of revenue for the government as unearthed by the auditors. The findings of fact of the RTC were affirmed by the CA. Hence, the petitioner was correctly convicted of the crimes charged because such findings of fact by the trial court, being affirmed by the CA as the intermediate reviewing tribunal, are now binding and conclusive on the Court. Accordingly, we conclude that the Prosecution sufficiently established that the petitioner had been the forger of the falsified and tampered public documents, and that the falsifications of the public documents had been necessary to commit the malversations of the collected taxes. The CA’s disquisition regarding malversation through negligence had the same tenor as that of the RTC’s, and later on even went to the extent of opining that the petitioner ought to be held guilty of malversation through negligence. But such opinion on the part of the CA would not overturn his several convictions for the intentional felonies of malversation of public funds through falsification of public documents. As can be seen, both lower courts unanimously concluded that the State’s evidence established his guilt beyond reasonable doubt for malversation of public funds through falsification of public documents. At any rate, even if it were assumed that the findings by the CA warranted his being guilty only of malversation through negligence, the Court would not be barred from holding him liable for the intentional crime of malversation of public funds through falsification of public documents because his appealing the convictions kept the door ajar for an increase in his liability. It is axiomatic that by appealing he waived the constitutional protection against double jeopardy, leaving him open to being convicted of whatever crimes the Court would ultimately conclude from the records to have been actually committed by him within the terms of the allegations in the informations under which he had been arraigned. 2. No. We see an obvious need to correct the penalties imposed on the petitioner. He was duly convicted of 18 counts of malversation of public funds through falsification of public documents, all complex crimes. Pursuant to Art. 48 of the RPC, the penalty for each count is that prescribed on the more serious offense, to be imposed in its maximum period. Falsification of a public document by a public officer is penalized with prision mayor and a fine not to exceed P5,000. (See Art. 171, RPC) Prision mayor has a duration of 6 years and 1 day to 12 years of imprisonment. In contrast, the penalty for malversation ranges from prision correccional in its medium and maximum periods to reclusion temporal in its maximum period to reclusion perpetua depending on the amount misappropriated, and a fine equal to the amount of the funds malversed or to the total value of the property embezzled. (See Art. 271, RPC) To determine the maximum periods of the penalties to be imposed on the petitioner, therefore, we must be guided by the following rules, namely: (1) the penalties provided under Art. 217 of the RPC constitute degrees; and (2) considering that the penalties provided under Art. 217 are not composed

of three periods, the time included in the penalty prescribed should be divided into 3 equal portions, which each portion forming one period, pursuant to Art. 65 of the RPC. Accordingly, the penalties prescribed under Art. 217 should be divided into 3 periods, with the maximum period being the penalty properly imposable on each count, except in any instance where the penalty for falsification would be greater than such penalties for malversation. Under Sec. 1 of the Indeterminate Sentence Law, an indeterminate sentence is imposed on the offender consisting of a maximum term and a minimum term. The maximum term is the penalty under the RPC properly imposed after considering any attending circumstance; while the minimum term is within the range of the penalty next lower than that prescribed by the RPC for the offense committed. The Indeterminate Sentence Law was applicable here, save for the counts for which the imposable penalty was reclusion perpetua. Considering that each count was a complex crime without any modifying circumstances, the maximum term of the penalty for each count is the maximum period (computed based on the rules in the preceding paragraph), except for the count dealt with in Criminal Case No. 4635 involving the misappropriated amount of P4,869 for which the corresponding penalty for malversation was prision mayor in its minimum and medium periods. However, because such penalty for malversation was lower than the penalty of prision mayor imposable on falsification of a public document under Art. 171 of the RPC, it is the penalty of prision mayor in its maximum period that was applicable. On other hand, the minimum of the indeterminate sentence for each count should come from the penalty next lower than that prescribed under Art. 217 of the RPC except in Criminal Case No. 4635 where the penalty next lower is prision correccional in its full range. To illustrate, the count involving the largest amount misappropriated by the accused totaling P75,489.76 merited the penalty of reclusion temporal in its maximum period to reclusion perpetua, and a fine of P75,489.76. Obviously, the penalty is that prescribed for malversation of public funds, the more serious offense. In its consolidated decision of February 17, 2004, the RTC erred in pegging the maximum terms within the minimum periods of the penalties prescribed under Art. 217 of the RPC. It committed another error by fixing indeterminate sentences on some counts despite the maximum of the imposable penalties being reclusion perpetua. There is even one completely incorrect indeterminate sentence. And, as earlier noted, the penalty for falsification under Art. 171 of the RPC was applicable in Criminal Case No. 4635 involving P4,869 due to its being the higher penalty. One more omission by the CA and the RTC concerned a matter of law. This refers to their failure to decree in favor of the Government the return of the amounts criminally misappropriated by the accused. That he was already sentenced to pay the fine in each count was an element of the penalties imposed under the RPC, and was not the same thing as finding him civilly liable for restitution, which the RTC and the CA should have included in the judgment. JUSTIFYING CIRCUMSTANCES; DEFENSEOF A RELATIVE Ricardo Medina Jr. vs. People of the Philippines G.R. No. 161308, January 15, 2014 Doctrine: In order that defense of a relative is to be appreciated in favor of Ricardo, the following requisites must concur, namely: (1) unlawful aggression by the victim; (2) reasonable necessity of the means employed to prevent or repel the aggression; and (3) in case the provocation was given by the person attacked, that the person making the defense took no part in the provocation. Like in self–defense, it is the accused who carries the burden to prove convincingly the attendance and concurrence of these requisites because his invocation of this defense amounts to an admission of having inflicted the fatal injury on the victim.

Facts: This case concerns the fatal stabbing of Lino Mulinyawe which was preceded by a fight during a basketball game between Ross Mulinyawe, Lino’s son, and Ronald Medina, the younger brother of Ricardo and Randolf. Ronald had hit Ross with a piece of stone; hence, Ross was brought to the hospital for treatment. Lino learned that his son had sustained a head injury, he forthwith went towards the house of the Medinas accompanied by his drinking buddies, Tapan and Menes. He had a bread knife tucked in the back, but his companions were unarmed. Along the way, Lino encountered Randolf whom he confronted about the fight. The two of them had a heated argument. Lino lashed out at Randolf and gripped the latter’s hand. Randolf retreated towards the store and took two empty bottles of beer, broke the bottles and attacked Lino with them. Arriving at the scene, Ricardo saw what was happening, and confronted Lino. Ricardo entered their house to get a kitchen knife and came out. Lino made a thrust at Ricardo but failed to hit the latter, who then stabbed Lino on the left side of his chest, near the region of the heart. Lino fell face down on the ground. The Office of the City Prosecutor of Pasig City charged Randolf with homicide. The information was amended with leave of court to include Ricardo as a co– conspirator. The Defense claimed that it was Lino who had attacked Ricardo with a knife, and that Lino had accidentally stabbed himself by falling frontward and into his own knife. The RTC acquitted Randolf but convicted Ricardo of homicide for it found no evidence of conspiracy between Randolf and Ricardo. The CA affirmed his conviction. On appeal, the petitioner argues that the CA erred in making a finding that he stabbed the deceased but disregarded the justifying circumstance of defense of a relative. Issue: Whether or not the justifying circumstance of defense of a relative should be appreciated Ruling/Ratio: No. Reviewing the records, we find that appellant’s guilt as the perpetrator of the unlawful killing of the victim Lino Mulinyawe had been adequately proven by prosecution evidence, both testimonial and physical. In order that defense of a relative is to be appreciated in favor of Ricardo, the following requisites must concur, namely: (1) unlawful aggression by the victim; (2) reasonable necessity of the means employed to prevent or repel the aggression; and (3) in case the provocation was given by the person attacked, that the person making the defense took no part in the provocation. Like in self–defense, it is the accused who carries the burden to prove convincingly the attendance and concurrence of these requisites because his invocation of this defense amounts to an admission of having inflicted the fatal injury on the victim. In invoking defense of a relative, Ricardo states that his immediate impulse upon seeing Randolf being attacked by Lino with a knife was to get his own weapon and to aid in the defense of Randolf. But that theory was inconsistent with his declaration at the trial that Lino’s fatal wound had been self-inflicted, as it presupposes direct responsibility for inflicting the mortal wound. Thus, his defense was unworthy of belief due to its incongruity with human experience. However, his defense was unworthy of belief due to its incongruity with human experience. CIVIL LIABILITY Dr. Encarnacion Lumantas vs. Hanz Calapiz G.R. No. 163753, January 15, 2014 Doctrine: It is axiomatic that every person criminally liable for a felony is also civilly liable. Nevertheless, the acquittal of an accused of the crime charged does not necessarily extinguish his civil liability. Facts: Spouses Calapiz brought their son Hanz Calapiz to the Misamis Occidental Provincial Hospital, Oroquieta City, for an emergency appendectomy. Hanz was attended to by the petitioner, who suggested to the parents that Hanz also undergo circumcision at no added cost to spare him the pain. Hanz complained of pain in his penis, which exhibited blisters. His testicles were swollen. The parents noticed that the child

urinated abnormally after the petitioner forcibly removed the catheter, but the petitioner dismissed the abnormality as normal. Hanz was discharged from the hospital over his parents’ protestations. Hanz was confined in a hospital because of the abscess formation between the base and the shaft of his penis. The petitioner referred him to Dr. Henry Go, an urologist, who diagnosed the boy to have a damaged urethra. Thus, Hanz underwent cystostomy, and thereafter was operated on three times to repair his damaged urethra. When his damaged urethra could not be fully repaired and reconstructed, Hanz’s parents brought a criminal charge against the petitioner for reckless imprudence resulting to serious physical injuries. The RTC acquitted the petitioner of the crime charged for insufficiency of the evidence, but ruled the petitioner was liable for moral damages because there was a preponderance of evidence showing that Hanz had received the injurious trauma from his circumcision by the petitioner. Issue: Whether or not the petitioner can be held civilly liable despite his acquittal of the crime of reckless imprudence resulting in serious physical injuries Ruling/Ratio: Yes. It is axiomatic that every person criminally liable for a felony is also civilly liable. Nevertheless, the acquittal of an accused of the crime charged does not necessarily extinguish his civil liability. Our law recognizes two kinds of acquittal, with different effects on the civil liability of the accused. First is an acquittal on the ground that the accused is not the author of the act or omission complained of. This instance closes the door to civil liability, for a person who has been found to be not the perpetrator of any act or omission cannot and can never be held liable for such act or omission. The second instance is an acquittal based on reasonable doubt on the guilt of the accused. In this case, even if the guilt of the accused has not been satisfactorily established, he is not exempt from civil liability which may be proved by preponderance of evidence only. Conformably with the foregoing, therefore, the acquittal of an accused does not prevent a judgment from still being rendered against him on the civil aspect of the criminal case unless the court finds and declares that the fact from which the civil liability might arise did not exist. The petitioner’s contention that he could not be held civilly liable because there was no proof of his negligence deserves scant consideration. The failure of the Prosecution to prove his criminal negligence with moral certainty did not forbid a finding against him that there was preponderant evidence of his negligence to hold him civilly liable. With the RTC and the CA both finding that Hanz had sustained the injurious trauma from the hands of the petitioner on the occasion of or incidental to the circumcision, and that the trauma could have been avoided, the Court must concur with their uniform findings.

VIOLATION OF ANTI-GRAFT AND CORRUPTION PRACTICES ACT Teofilo Giangan vs. People of the Philippines G.R. No. 169385, August 26, 201 Doctrine: Manifest partiality should be inferred only if there was a clear showing that there had been others who had been bothered by the similar allegedly illegal constructions and had complained, but the accused, in their capacities as barangay officials, did not deal with such complaint with the same alacrity. Facts: In his capacity as the barangay chairman, Giangan, along with his co-accused Domail, a barangay councilor, and Bontia, the head of the barangay tanods, were charged with the violation of Section 3 (e) of R. A. No. 3019. It appears that Aurelia Bernadas hired Delfin Buot to construct the wooden fence on her land; that the accused removed the fence; that Buot learned that Giangan and his co-accused removed the wooden fence; that Buot first directly inquired from Giangan why the latter had destroyed the fence, but he harshly told him to tell Bernadas to just file a case against him; and that Buot accompanied Bernadas and her spouse to confront Giangan, who reiterated his dare for them to just file a case. Bernadas testified that she had caused the construction of the fence on her three properties because the fruits of the coconut trees growing on her properties were frequently stolen, and also because the sand

on the seashore within her properties was being excavated; that she reported the theft to Giangan, who did not take any action on her complaint; that she spent a total of P11,200 for labor and materials in the construction of the fence; that upon learning of the removal of the fence, she visited Giangan to inquire, but the latter shouted at her: “It is within my power as barangay captain to destroy the fence,” and “Don’t tell me what to do, you just file a case in court;” that many landowners put up fences on their properties in the area, but the fences were not removed; and that there was no established road right of way on her properties ever since she could remember. The RTC rendered its judgment finding all of the accused guilty as charged. Issue: Whether or not the conviction of Giangan for the crime charged is proper Ruling/Ratio: In every prosecution for the violation of Section 3 (e) of R.A. No. 3019, the State must prove the following essential elements, namely: (1) The accused is a public officer discharging administrative, judicial or official functions; (2) He must have acted with manifest partiality, evident bad faith, or gross inexcusable negligence in the discharge of his functions and; (3) His action caused any undue injury to any party, including the Government, or gave any private party unwarranted benefits, advantage or preference in the discharge of his functions. The first element was present, for Giangan was indisputably a government official at the time of the alleged commission of the offense charged. The second element enumerates the different modes by which means the offense penalized in Section 3 (e) may be committed. "Partiality" is synonymous with "bias" which "excites a disposition to see and report matters as they are wished for rather than as they are." Bad faith does not simply connote bad judgment or negligence; it imputes a dishonest purpose or some moral obliquity and conscious doing of a wrong; it partakes of the nature of fraud. Gross negligence has been so defined as negligence characterized by the want of even slight care, acting or omitting to act in a situation where there is a duty to act, not inadvertently but willfully and intentionally with a conscious indifference to consequences in so far as other persons may be affected. Proof of the existence of any of these modes in connection with the prohibited acts under Section 3 (e) should suffice to warrant conviction. In this case, the Sandiganbayan erred in ruling that Giangan and his co-accused had acted with gross bad faith and manifest impartiality when they removed the wooden posts of the fence of Bernadas. On the contrary, their actuations evinced good faith. It was not at all disputed that access through the road had long been permitted even by the owner and her predecessor. In that context, Giangan as the barangay chairman acted upon the honest and sincere belief that he was then summarily abating the nuisance that a regular user of the obstructed road had just reported to him. A further indication of the good faith of Giangan was the turning over of the wooden posts to the police station, manifesting that the accused were acting within the scope of their authority. The Sandiganbayan further erred in finding the presence of manifest partiality on the basis that there had been other allegedly illegal constructions that the accused did not similarly remove in their capacities as barangay officials. Bias should still not be imputed against them because they were acting on the complaint against the inconvenience brought about by the obstruction erected on the access road. Manifest partiality should be inferred only if there was a clear showing that there had been others who had been bothered by the similar allegedly illegal constructions and had complained, but the accused, in their capacities as barangay officials, did not deal with such complaint with the same alacrity. In light of the foregoing, the guilt of Giangan was not established beyond reasonable doubt. Hence, he is entitled to acquittal.

CONSPIRACY; COMPLEX CRIME;INDETERMINATE SENTENCE LAW Aurora Fransdilla vs. People of the Philippines G.R. No. 197562, August 20, 2015 Doctrines: 1. The complex crime of robbery in an inhabited house by armed persons and robbery with violence against or intimidation of persons was committed when the accused, who held firearms, entered the residential house of the victims and inflicted injury upon the victims in the process of committing the robbery. Hence, the penalty is that imposed for the robbery in an inhabited house, the more serious. 2.

It is not always required to establish that two or more persons met and explicitly entered into the agreement to commit the crime by laying down the details of how their unlawful scheme or objective would be carried out. Conspiracy can also be deduced from the mode and manner in which the offense is perpetrated, or can be inferred from the acts of the several accused evincing their joint or common purpose and design, concerted action and community of interest. Once conspiracy is established, the act of each conspirator is the act of all.

3.

Considering that the clear objective of the Indeterminate Sentence Law is to have the convict serve the minimum penalty before becoming eligible for release on parole pursuant to the Indeterminate Sentence Law, both the minimum and the maximum penalties must be definite, not ranging. This objective cannot be achieved otherwise, for determining when the convict would be eligible for release on parole would be nearly impossible if the minimum and the maximum were indefinite.

Facts: Aurora Engson Fransdilla, the lone appellant, seeks to reverse the decision of CA affirming her conviction and that of her co-accused for robbery on the basis of conspiracy. At private complainants’ residence, private complainant Lalaine Yreverre saw appellant Fransdilla in front of their gate. Upon noticing Fransdilla, Lalaine went to the gate and asked Fransdilla what is their purpose, as there were 4 of them. Fransdilla then inquired about Cynthia Yreverre, Lalaine’s sister. The latter replied that Cynthia was in the Japanese Embassy and asked Fransdilla if there was any other person whom she wanted to talk to. It was then that Aurora told Lalaine that she was from the Philippine Overseas Employment Agency (POEA). It was upon said pretension that Lalaine offered herself to instead talk to her and allowed her to enter their house. Later on, four men who are with Fransdilla went inside the house and announced that it was a hold-up. The RTC convicted Fransdilla and her co-accused of robbery under Article 299 of the RPC and in the application of the Indeterminate Sentence Law, sentenced the accused to imprisonment of 12 years and 1 day to 14 years and 8 months of reclusion temporal as minimum to 17 years, 4 months and 1 day to 20 years of reclusion temporal as maximum. On appeal, the CA affirmed the conviction of all of the accused, but modified the penalty imposed by the RTC. The CA ruled that all the accused, including Fransdilla, were guilty of committing the complex crime of robbery in an inhabited house under Art. 299, RPC, and robbery with intimidation or violence under Art. 294, RPC. Thus, it held that the penalty for the complex crime under Art. 48 of the RPC was that for the more serious offense, to be imposed in its maximum period. Taking into consideration that no mitigating or aggravating circumstances were present, it set the indeterminate sentence of 12 years of prision mayor, as minimum, to 17 years and 4 months of reclusion temporal, as maximum. Issue/s: 1. Whether or not conspiracy was proved 2. Whether or not Indeterminate Sentence Law was properly applied by the RTC 3. Whether or not the modified penalty imposed by the CA is proper

Ruling/Ratio: 1. Yes. Conspiracy of Fransdilla with her co-accused was established beyond reasonable doubt. Contrary to Fransdilla’s contentions, the State competently and credibly established her active participation in the execution of the robbery through Lalaine’s testimony detailing her specific acts. In the eyes of the law, conspiracy exists when two or more persons come to an agreement concerning the commission of a crime and decide to commit it. For an accused to be validly held to have conspired with her co-accused in committing the crime, her overt acts must evince her active part in the execution of the crime agreed to be committed. The overt acts of each of the conspirators must tend to execute the offense agreed upon, for the merely passive conspirator cannot be held to be still part of the conspiracy without such overt acts, unless such conspirator is the mastermind. Here, Fransdilla was satisfactorily shown not to have been a mere passive coconspirator, but an active one who had facilitated the access into the house by representing herself as an employee of the POEA. In that respect, it is not always required to establish that two or more persons met and explicitly entered into the agreement to commit the crime by laying down the details of how their unlawful scheme or objective would be carried out. Conspiracy can also be deduced from the mode and manner in which the offense is perpetrated, or can be inferred from the acts of the several accused evincing their joint or common purpose and design, concerted action and community of interest. Once conspiracy is established, the act of each conspirator is the act of all. 2. No. That the trial judge fixed the indeterminate sentence at "imprisonment of 12 years and 1 day to 14 years and 8 months of reclusion temporal as minimum to 17 years, 4 months and 1 day to 20 years of reclusion temporal as maximum was a patent elementary error. Such fixing contravened the letter and spirit of the Indeterminate Sentence Law, Section 1. The CA justifiably deemed it necessary to correct the indeterminate sentence. Under Section 1 of the ISL the minimum of the indeterminate sentence is a penalty "within the range of the penalty next lower to that prescribed by the RPC for the offense," and the maximum is "that which, in view of the attending circumstances, could be properly imposed under the rules of the said Code." Considering that the clear objective of the Indeterminate Sentence Law is to have the convict serve the minimum penalty before becoming eligible for release on parole pursuant to the Indeterminate Sentence Law, both the minimum and the maximum penalties must be definite, not ranging. This objective cannot be achieved otherwise, for determining when the convict would be eligible for release on parole would be nearly impossible if the minimum and the maximum were as indefinite as the RTC fixed the indeterminate sentence. Indeed, that the sentence is an indeterminate one relates only to the fact that such imposition would leave the period between the minimum and the maximum penalties indeterminate" in the sense that he may, under the conditions set out in said Act, be released from serving said period in whole or in part." 3. Yes. We concur with the CA. Indeed, one who, by breaking a wall, enters, with a deadly weapon, an inhabited house and steals therefrom valuable effects, without violence against or intimidation upon persons, is punishable under Art. 299 of the RPC with reclusion temporal. Art. 294 applies where robbery with violence against or intimidation of a person takes place without entering an inhabited house, under the conditions set forth in Art. 299 of the RPC. When the elements of both provisions are present, the crime is a complex one, calling for the imposition – as provided in Art. 48 of said Code – of the penalty for the most serious offense, in its maximum period, which, in the case at bar, is reclusion temporal in its maximum period. In this case, Par. 5 of Art. 294, RPC is the relevant provision, under which the penalty is prision correccional in its maximum period to prision mayor in its medium period. For Art. 299, relevant are par. (a)4 (because Fransdilla pretended to be from the POEA) and par. (b)2 (because the accused brought the vault down from Cynthia’s upstairs bedroom and forced it open outside the place where the robbery was committed). The penalty for the crime is reclusion temporal. Under Art. 48 of the RPC, the penalty for the complex crime is that for the more serious felony, which, in this case, was the robbery in an inhabited house by armed men punishable by reclusion temporal, to be imposed in the maximum period (i.e., 17 years, 4 months and 1 day to 20 years). Hence, the

maximum of the indeterminate sentence of 12 years of prision mayor, as minimum, to 17 years and 4 months of reclusion temporal, must be corrected to 17 years, 4 months and 1 day of reclusion temporal. CHAIN OF CUSTODY; R.A. No. 9165 (COMPREHENSIVE DANGEROUS DRUGS ACT) People of the Philippines vs. Recto Angngao and Robert Carlin G.R. No. 189296, March 11, 2015 
 Doctrine: The State bears the burden of establishing the chain of custody of the dangerous drugs confiscated during a buy-bust operation. The evidence of the chain of custody must meet the test of proof beyond reasonable doubt. Facts: The Office of the City Prosecutor of Baguio City filed in the RTC two informations against Angngao and Robert Carlin y Pecdasen, charging them with the illegal sale of marijuana resin and illegal possession of marijuana hashish oil in violation of RA No. 9165 (Comprehensive Dangerous Drugs Act of 2002). They were apprehended by a buy-bust operation. The RTC convicted Angngao but acquitted Carlin. The CA promulgated its assailed judgment affirming the conviction of Angngao. Angngao questioned the decisions on the ground that the prosecution failed to establish the chain of custody of the confiscated drugs. Issue/s: Whether or not the guilt of the accused is proved beyond reasonable doubt Ruling/Ratio: No. To ensure a conviction for the illegal sale of dangerous drugs, the following elements constituting the crime must be present, namely: (a) the identities of the buyer and seller, the object of the sale, and the consideration; and (b) the delivery of the thing sold and the payment for the thing. Such prosecution for the sale of illegal drugs requires more than the hasty presentation of evidence to prove each element of the crime. The presentation of the drugs as evidence in court is indispensable in every prosecution for the illegal sale of dangerous drugs because the drugs are the corpus delicti of the crime. As such, the State should establish beyond doubt the identity of the dangerous drugs by showing that the dangerous drugs offered in court as evidence were the same substances bought during the buy-bust operation. This requirement is complied with by ensuring that the custody of the seized drugs from the time of confiscation until presentation in court is safeguarded under what is referred to as the chain of custody by Republic Act No. 9165, whose objective is to remove unnecessary doubts concerning the identity of the evidence. Should the State not definitively establish that the dangerous drugs presented in court were the very same substances actually recovered from the accused, the criminal prosecution for drug pushing should fail because the guilt of the accused was not established beyond reasonable doubt. The manner and timing of the marking of the seized drugs or related items in accordance with the rules under RA 9165 are crucial in proving the chain of custody. The marking by the arresting officer of the drugs, being the starting point in the custodial link, should be made immediately upon the seizure, or, if that is not possible, as close to the time and place of the seizure as practicable under the obtaining circumstances. This immediate marking is essential because the succeeding handlers of the drugs would use the markings as their reference to the seizure, and because it further serves to segregate the marked seized drugs from all other evidence from the time and point of seizure until the drugs are disposed of at the end of the criminal proceedings. The deliberate taking of these identifying steps is statutorily aimed at obviating switching, “planting” or contamination of the evidence. Verily, the preservation of the chain of custody vis-à-vis the drugs ensures the integrity of the evidence incriminating the accused, and fulfills the

element of relevancy as a requisite for the admissibility of the evidence. The integrity of the evidence presented – the corpus delicti no less – became suspicious by the mysterious silence of the record on what transpired after the transaction. An examination of the record indicates that no testimony on the links in the chain of custody from the time the drugs were confiscated up to the time they were offered as evidence in court was given by the arresting lawmen and the others who could have handled the drugs. This omission deprived the lower courts of the means of knowing the details as to every person who touched the drugs, as to how and from whom the drugs were received, as to where the drugs were at any given point in that interval, and as to what happened to the drugs while in the possession of each handler, including the relative condition in which the drugs were received and the state in which they were delivered to the next links in the chain. It is quite notable that the officers who served as the only witnesses to the buy-bust operation neither described the precautions taken to ensure that there had been no change in the condition of the drugs nor specified that there was no opportunity for any person not in the chain to have possession of the drugs. TREACHERY People of the Philippines vs. Mariano Oandasan Jr., G. R. No. 194605, June 14, 2016 Doctrine: The attack was mounted with treachery because the two conditions in order for this circumstance to be appreciated concurred, namely: (a) that the means, methods and forms of execution employed gave the person attacked no opportunity to defend themselves or to retaliate; and (b) that such means, methods and forms of execution were deliberately and consciously adopted by the accused without danger to his person. The essence of treachery lay in the attack that came without warning, and was swift, deliberate and unexpected, affording the hapless, unarmed and unsuspecting victims no chance to resist, or retaliate, or escape, thereby ensuring the accomplishment of the deadly design without risk to the aggressor, and without the slightest provocation on the part of the victims. Facts: Cutaran testified that appellant aimed and fired his gun at Montegrico. Cutaran ran away after seeing the appellant shoot Mentegrico. He did not witness the shooting of the other two victims Tamanu and Paleg. As a result of the shooting incident, Montegrico and Tamanu, died; while Mario Paleg survived. Three informations were filed against the accused-appellant, two of which were for murder involving the fatal shooting of Tamanu and Montegrico, and the third was for frustrated homicide involving the near fatal shooting of Paleg. The RTC convicted the accused of murder for the fatal shooting of the first victim, and guilty of homicide and frustrated homicide as to the second and third victims. Issue: Whether or not the findings against the accused should be upheld Ruling/Ratio: No. Treachery attended the shooting of Tamanu and Paleg; hence, the accused is guilty of two counts of murder and one count of frustrated murder. Although the CA and the RTC correctly concluded that the accused had been directly responsible for the shooting of Tamanu and Paleg, we are perplexed why both lower courts only characterized the killing of Tamanu and the near-killing of Paleg as homicide and frustrated homicide while characterizing the killing of Montegrico as murder because of the attendance of treachery. The distinctions were unwarranted. The fact that the shooting of the three victims had occurred in quick succession fully called for a finding of the attendance of treachery in the attacks against all the victims. Montegrico, Tamanu and Paleg were drinking together outside their bunkhouse prior to the shooting when the accused suddenly appeared from the rear of the dump truck, walked towards their table and shot Montegrico without any warning. That first shot was quickly followed by more shots. In that situation, none of the three victims was aware of the imminent deadly assault by the accused, for they were just enjoying their drinks outside their bunkhouse. They were unarmed, and did not expect to be

shot, when the accused came and shot them. The attack was mounted with treachery because the two conditions in order for this circumstance to be appreciated concurred, namely: (a) that the means, methods and forms of execution employed gave the person attacked no opportunity to defend themselves or to retaliate; and (b) that such means, methods and forms of execution were deliberately and consciously adopted by the accused without danger to his person. The essence of treachery lay in the attack that came without warning, and was swift, deliberate and unexpected, affording the hapless, unarmed and unsuspecting victims no chance to resist, or retaliate, or escape, thereby ensuring the accomplishment of the deadly design without risk to the aggressor, and without the slightest provocation on the part of the victims. What was decisive is that the execution of the attack made it impossible for the victims to defend themselves or to retaliate. Treachery as an aggravating or attendant circumstance must be established beyond reasonable doubt. PENALTY Pedro Ladines vs. People of the Philippines G.R. No. 167333, January 11, 2016 Doctrine: To impose the highest within a period of the imposable penalty without specifying the justification for doing so is an error on the part of the trial court that should be corrected on appeal. In default of such justification, the penalty to be imposed is the lowest of the period. Facts: An information was filed in the RTC charging the petitioner and Licup with homicide. While Prosecution witnesses along with victim Erwin were watching a dance, the petitioner suddenly and without warning approached and stabbed Erwin below the navel with a machete. The petitioner then left after delivering the blow. At that juncture, Licup also mounted his attack against Erwin but the latter evaded the blow by stepping back. Erwin pulled out the machete from his body and wielded it against Licup, whom he hit in the chest. Licup pursued but could not catch up with Erwin because they both eventually fell down. Erwin was rushed to the hospital where he succumbed. RTC pronounced the petitioner guilty of the crime Homicide, sans any mitigating circumstances and applying the Indeterminate Sentence Law, sentenced him to suffer an imprisonment of from 10 years and 1 day of prision mayor as minimum to 17 years and 4 months of reclusion temporal as maximum. Issue: Whether or not the penalty was proper Ruling/Ratio: No. Homicide is punished with reclusion temporal. We declare that the lower courts could not impose 17 years and four months of the medium period of reclusion temporal, which was the ceiling of the medium period of reclusion temporal, as the maximum of the indeterminate penalty without specifying the justification for so imposing. They thereby ignored that although Article 64 of the RPC, which has set the rules “for the application of penalties which contain three periods,” requires under its first rule that the courts should impose the penalty prescribed by law in the medium period should there be neither aggravating nor mitigating circumstances, its seventh rule expressly demands that “within the limits of each period, the courts shall determine the extent of the penalty according to the number and nature of the aggravating and mitigating circumstances and the greater or lesser extent of the evil produced by the crime. By not specifying the justification for imposing the ceiling of the period of the imposable penalty, the fixing of the indeterminate sentence became arbitrary, or whimsical, or capricious. In the absence of the specification, the maximum of the indeterminate sentence for the petitioner should be the lowest of the medium period of reclusion temporal, which is 14 years, eight months and one day of reclusion temporal.

ILLEGAL RECRUITMENT INLARGE SCALE; ESTAFA People of the Philippines vs. Marissa Bayker G.R. No. 170192, February 10, 2016 Doctrine: An illegal recruiter can be liable for the crimes of illegal recruitment committed in large scale and estafa without risk of being put in double jeopardy, provided that the accused has been so charged under separate informations. Facts: Caniazares, Dahab and Miparanum testified that they had met the accused-appellant who represented herself to be recruiting workers for overseas employment. They paid her for their medical examination and placement fees for which a receipt is issued. However, they were not deployed as promised by the accused. Subsequently, the learned from the POEA that the accused appellant had not been issued the license to recruit and place people overseas. The Office of the City Prosecutor of Makati filed a complaint for Illegal Recruitment and Estafa against the accused. Issue: Whether the accused-appellant is guilty for the crimes of illegal recruitment in large scale and estafa Ruling/Ratio: Yes. Illegal recruitment is committed by a person who: (a) undertakes any recruitment activity defined under Article 13(b) or any prohibited practice enumerated under Art. 34 and Art. 38 of the Labor Code; and (b) does not have a license or authority to lawfully engage in the recruitment and placement of workers. It is committed in large scale when it is committed against 3 or more persons individually or as a group. The accused-appellant committed illegal recruitment in large scale because she had committed acts of recruitment against at least 3 persons despite her not having been duly licensed or authorized by the POEA for that purpose. The accused-appellant's insistence on her very limited participation in the recruitment of the complainants did not advance or help her cause any because the State established her having personally promised foreign employment either as hotel porters or seafarers to the complainants despite her having no license or authority to recruit from the POEA. The records made it clear enough that her participation was anything but limited, for she herself had accompanied them to their respective medical examinations at their own expense. In addition, she herself brought them to GNB Marketing and introduced them to her co-accused. The conviction of the accused-appellant for illegal recruitment committed in large scale did not preclude her personal liability for estafa under Art. 315(2)(a) of the RPC on the ground of subjecting her to double jeopardy. The elements of estafa as charged are: (1) the accused defrauded another by abuse of confidence or by means of deceit; and (2) the offended party, or a third party suffered damage or prejudice capable of pecuniary estimation. In contrast, the crime of illegal recruitment committed in large scale, as indicated earlier, requires different elements. Double jeopardy could not result from prosecuting and convicting the accused-appellant for both crimes considering that they were entirely distinct from each other not only from their being punished under different statutes but also from their elements being different. The active representation by the accused-appellant of having the capacity to deploy Miparanum abroad despite not having the authority or license to do so from the POEA constituted deceit as the first element of estafa. Her representation induced the victim to part with his money, resulting in damage that is the second element of the estafa.

MERCANTILE LAW SUBSCRIPTION AGREEMENT;CERTIFICATE OF STOCK Interport Resources Corporation v. Securities Specialist Inc. GR No. 154069, June 6, 2016 Doctrine: The effect of assignment of subscription agreements is to make the agreements binding between the corporation and the assignee. No transfer of shares of stock shall be valid, except as between the parties, until the transfer is recorded in the books of the corporation (Section 63, Corporation Code). Hence, a transfer of shares not recorded in the stock and transfer book of the corporations is nonexistent as far as the corporation is concerned. Facts: Oceanic Oil and Mineral Resources Inc. entered into a subscription agreement with RC Lee (domestic corporation) over 5 million shares for a total par value of P50,000, where RC Lee paid 25% of the subscription. Oceanic merged with Interport Resources (surviving corporation; publicly-listed domestic corporation). Securities Specialist Inc (SSI; domestic corporation) registered as a dealer in securities and received in the ordinary course of business the outstanding Subscription Agreements all in the name of RC Lee. Later on, upon request from Interport’s Corporate Secretary, RC Lee found no record showing any transfer or assignment of the Oceanic subscription agreements and stock certificates of Interport and thus paid its unpaid subscriptions and was accordingly issued the corresponding stock certificates. Interport issued a call for the full payment of subscription receivables. SSI tendered payment before the deadline through two stockbrokers, but Interport refused to honor the Oceanic subscriptions. SSI still directly tendered payment to Interport for the balance of the 5M shares, which was originally rejected by Interport since the Oceanic subscription agreements should have been previously converted to shares in Interport. SSI required Interport to furnish it with a copy of the notice requiring conversion but Interport failed to show any proof, so SSI asked SEC for a copy of the Board Resolution requiring the conversion. SEC informed SSI that there is no record of any such resolution. No copy of the resolution was produced and the tender of payment was still rejected. SSI later learned that Interport issued 5M shares to RC Lee based on RC Lee’s registration as the owner of the subscriptions agreement in Interport’s books and on RC Lee’s President’s affidavit that no transfer or encumbrances of the shares had been made. SSI demanded from RC Lee the delivery of the 5M shares but RC Lee failed to return the shares since they were already sold to other parties. SSI demanded RC Lee to pay the current market value of the 5M shares. Issue: Was Interport liable to deliver to SSI the Oceanic shares of stock (or the value thereof) under the subscription agreements? Ruling/Ratio: YES, because by the assignment, the subscription agreements became binding between SSI and Interport, but Interport denied recognition of the said subscription agreements. The effect of the assignment of the subscription agreements to SSI was to extinguish the obligation of R.C. Lee to Oceanic (now Interport) to settle the unpaid balance on the subscription. Due to the assignment, Interport was no longer obliged to accept any payment from R.C. Lee because the latter had ceased to be privy to the subscription agreements. Interport was legally bound to accept SSI's tender of

payment for the 75% balance on the subscription price because SSI had become the new debtor under the agreements. As such, the issuance of the stock certificates in the name of R.C. Lee had no legal basis in the absence of a contractual agreement between R.C. Lee and Interport. Under Section 63 of the Corporation Code, no transfer of shares of stock shall be valid, except as between the parties, until the transfer is recorded in the books of the corporation to show the names of the parties, date of transfer, number of certificates and number of shares transferred. Hence, a transfer of shares not recorded in the stock and transfer book of the corporations is non-existent as far as the corporation is concerned. As between the corporation and its shareholders and third persons, the corporation looks only to its books to determine who its shareholders are. It is only when the transfer has been recorded in the stock and transfer book that a corporation may rightfully regard the transferee as one of its stockholders, and from this time, the corporation has the consequent obligation to recognize such rights as mandated by law. The subscription agreements were now binding between SSI and Interport only, and only such parties were expected to comply with the terms thereof. Hence, Interport was liable to deliver to SSI the Oceanic shares under the subscription agreements. The right to have the transfer registered exists from the time of the transfers and it is to the transferee’s benefit that the right must be exercised early. Since the law does not prescribe any period within which the registration should be effected, the action to enforce the right does not accrue until there has been a demand and a refusal to record the transfer. Thus, here, SSI acted with sufficient dispatch in seeking to enforce its rights under the subscription agreements within the reasonable period where the denial of the recognition of its subscription agreements and the complaint happened within the same year. INSURANCE CODE; EXEMPTION FROM LEVY OF SECURITY DEPOSIT Capital Insurance and Surety Co v. Del Monte Motor Works Inc. G.R. No. 159979, December 9, 2015 Doctrine: The security deposit (under Section 203 of the Insurance Code) is exempt from levy by a judgment creditor or any claimant because the securities are held as contingency fund to answer for the claims against the insurance company by all its policy holders and their beneficiaries. Consequently, the Insurance Commissioner’s refusal to release the security deposit despite garnishment on execution is legally justified because the Insurance Commissioner has the specific legal duty to hold the security deposits for the benefit of all policy holders. Facts: Del Monte Motor Works sued Vilfran Liner, Hilaria Villegas and Maura Villegas to recover unpaid billings for the fabrication and construction of passenger bus bodies. The case resulted in the levy of 10 buses and three parcels of land and garnishment of funds in several bank accounts of the defendants. To enforce the RTC decision in Del Monte’s favor, a notice of garnishment was issued against the security deposit of Capital Insurance in the Insurance Commission. The RTC ordered the Insurance Commission to withdraw from the security deposit of the Capital Insurance the amount to satisfy the notice of garnishment. The Insurance Commissioner turned down the request to release claiming that under Section 203 of the Insurance Code, security deposit is exempt from execution. Issues: 1. May the security deposit of Capital Insurance be a subject of levy in contravention of Section 203 of the Insurance Code? 2. Was the Insurance Commissioner’s refusal to release the security deposit despite the garnishment on execution legally justified? Ruling/Ratio: 1. No, the security deposit was immune from levy or execution.

The last paragraph of Section 203 of the Insurance Code regarding investment of funds in securities to be deposited with and held by the Insurance Commissioner provides that “no judgment creditor or other claimant shall have the right to levy upon any securities of the insurer held on deposit under this section or held on deposit pursuant to the requirement of the Commissioner”. Such provision indicates that the security deposit is exempt from levy by a judgment creditor or any claimant. The purpose of the exemption is because the securities are held as contingency fund to answer for the claims against the insurance company by all its policy holders and their beneficiaries. This step is taken if the company becomes insolvent or otherwise unable to satisfy the claims against it. Thus, a single claimant may not lay stake on the securities to the exclusion of all others. The other parties may have their own claims against the insurance company under other insurance contracts it has entered. Denying this exemption would potentially pave the way for a single claimant to short-circuit the procedure normally undertaken in adjudicating claims against an insolvent company under the rules on concurrence and preference of credits. To allow the Del Monte to proceed independently against the security deposit of Capital Insurance would not only prejudice the policy holders and their beneficiaries, but would also annul the very reason for which the law required the security deposit. If at all, Del Monte’s interest in the security deposit could only be inchoate or a mere expectancy, and thus had no attribute as property. 2. Yes, because the Insurance Commissioner had the specific legal duty to hold the security deposits for the benefit of all policy holders. Among the regulatory responsibilities of the Insurance Commissioner is the duty to hold the security deposits (under Secs 191 and 203 of the Insurance Code) for the benefit and security of all policy holders. The law specifically confers custody over the securities upon the commissioner, with whom these investments are required to be deposited. As the officer vested with custody of the security deposit, the insurance commissioner is in the position to determine when it may be released without prejudicing the rights of other policy holders. Before allowing the withdrawal or the release of the deposit, the commissioner must be satisfied that the conditions contemplated by the law are met and all policy holders protected. In this case, the Insurance Commissioner properly refused the request to release under the notice of garnishment. INTELLECTUAL PROPERTY; COPYRIGHT INFRINGEMENT Microsoft Corporation v. Manansala GR No. 166391, October 21, 2015 Doctrine: The gravamen of copyright infringement is not merely the unauthorized manufacturing of intellectual works but rather the unauthorized performance of any of the acts covered by the copyright (Section 5, Decree on Intellectual Property) such that any person who performs any of the acts under Section 5 without obtaining the copyright owner’s prior consent renders himself civilly and criminally liable for copyright infringement. Facts: Microsoft Corporation is the copyright and trademark owner of all rights relating to all versions and editions of Microsoft software and their user guides and manuals. Rolando Manansala is doing business under the name “Dataman Trading Company” and/or “Comic Alley”. Manansala was engaged in distributing and selling Microsoft computer software programs without authority from Microsoft. Through a test-purchase, an NBI agent was able to purchase from Manansala six CD ROMS containing various computer programs belonging to Microsoft. Later on, through a search of Manansala’s premises yielded several illegal copies of Microsoft programs. The charge of copyright infringement against Manansala was

dismissed by the State Prosecutor because there is no proof that Manansala was the one who really printed or copied the products of Microsoft for sale in his store. Issue: Is printing or copying essential in the commission of the crime of copyright infringement under Section 29 of Presidential Decree No. 49? In other words, does mere selling of pirated computer software constitute copyright infringement? Ruling/Ratio: No, the printing or copying is not essential, because the commission of any of the acts 3 of exclusive right that consists a copyright under Section 5 of the Decree on Intellectual Property without the copyright owner’s consent constitute actionable copyright infringement. Infringement of a copyright is a trespass on a private domain owned and occupied by the owner of the copyright, and, therefore, protected by law, and infringement of copyright, or piracy, which is a synonymous term in this connection, consists in the doing by any person, without the consent of the owner of the copyright, of anything the sole right to do is conferred by statute on the owner of the copyright. The gravamen of copyright infringement is not merely the unauthorized manufacturing of intellectual works but rather the unauthorized performance of any of the acts covered by the copyright (Section 5, Decree on Intellectual Property). Hence, any person who performs any of the acts under Section 5 without obtaining the copyright owner’s prior consent renders himself civilly and criminally liable for copyright infringement. STOCKHOLDER’S RIGHT TO INSPECT CORPORATE BOOKS AND RECORDS Terelay Investment and Development Corporation v. Yulo G.R. No. 160924, August 5, 2015 Doctrine: All stockholders have the right to inspect the corporate books and records, without requiring any specific amount of interest for the exercise of the right to inspect to be protected from possible mismanagement by its officers. Officers and directors have no legal authority to close the office doors against shareholders for whom they are only agents, and withhold from them the right to inspect the books which furnishes the most effective method of gaining information which the law has provided, on mere doubt or suspicion as to the motives of the shareholder. Facts: Cecilia Yulo, a stockholder who owns .001% interest in Terelay Investment, wrote a letter request to the corporation to be allowed to examine its books and records. Terelay denied the request and demanded Yulo to show proof that she was a bona fide stockholder. Yulo resent a letter request clarifying that her purpose is to inquire into the financial condition of Terelay and the conduct of its affairs by the principal officers. Terelay’s counsel advised Yulo not to continue with the inspection to avoid trouble. Terelay pointed out that Yulo’s name as incorporator, stockholder and director in the Articles of Incorporation and Amendments were unsigned; she did not pay for the five shares appearing in the Amended AOI and General Information Sheet; she did not subscribe to the shares; she has neither been in possession of

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(A) To print, reprint, publish, copy, distribute, multiply, sell, and make photographs, photo-engravings, and pictorial illustrations of the works; (B) To make any translation or other version or extracts or arrangements or adaptations thereof; to dramatize it if it be a nondramatic work; to convert it into a non-dramatic work if it be a drama; to complete or execute if it be a model or design; (C) To exhibit, perform, represent, produce, or reproduce, the work in any manner or by any method whatever for profit or otherwise; it not reproduced in copies for sale, to sell any manuscript or any record whatsoever thereof; (D) To make any other use or disposition of the work consistent with the laws of the land.

nor seen the certificate of stock covering the five share; the donation of the five shares was null and void and there was no acceptance by her as donee. Issue: Is Yulo considered a stockholder entitled to inspect the corporation’s books and records despite her shareholding of .001% interest considering that corporate documents show that she is a registered stockholder? Ruling/Ratio: Yes, since the corporate documents support Yulo’s claim as a registered stockholder, she has the right under Section 74 and 75 of the Corporation Code to inspect the corporation’s books, records, and financial statements. Yulo has the right to be fully informed of Terelay’s corporate condition and the manner its affairs are being managed. It is well-settled that the ownership of shares of stock gives stockholders the right under the law to be protected from possible mismanagement by its officers. This right is predicated upon selfpreservation. In any case, Terelay was not able to prove that Yulo was in bad faith or had an ulterior motive in demanding her right as stockholder. Terelay’s claim that Yulo has “insignificant stockholding” is also unwarranted. The Corporation Code granted to all stockholders the right to inspect the corporate books and records, without requiring any specific amount of interest for the exercise of the right to inspect. (When the law has made no distinction, we ought not to recognize any distinction.) Terelay cannot also arbitrarily deny Yulo’s right to inspect on the ground that the inspection would be used for a dubious or doubtful reason. Under Section 74 of the Corporation Code, the only time when the demand to examine and copy the corporation’s records could be refused is when the corporation puts up as a defense to any action that “the person demanding” had “improperly used any information secured through any prior examination of the records or minutes of such corporation or of any other corporation, or was not acting in good faith or for a legitimate purpose in making his demand.” The right of the shareholder to inspect the books and records of the corporation should not be made subject to the condition of a showing of any particular dispute or of proving any mismanagement or other occasion rendering an examination proper, but if the right is to be denied, the burden of proof is upon the corporation to show that the purpose of the shareholder is improper, by way of defense. In general, officers and directors have no legal authority to close the office doors against shareholders for whom they are only agents, and withhold from them the right to inspect the books which furnishes the most effective method of gaining information which the law has provided, on mere doubt or suspicion as to the motives of the shareholder. BY LAWS; ARTICLES OF INCORPORATION Forest Hills Golf and Country Club v. Gardpro Inc. G.R. No. 164686, October 22, 2014 Doctrine: In resolving inconsistencies between the by-laws and an officer’s affidavit, the by-laws should prevail because they constituted the private statutes of the corporation and its members and must be strictly complied with and applied to the letter. The articles of incorporation and the by-laws of a corporation define and regulate the relations between the corporation and the stockholders. In interpreting them, the literal meaning of their provisions shall control, and such provisions should be construed as a whole and not in isolation.

Facts: Forest Hills is a non-profit stock corporation established to promote social, recreational and athletic activities among its members, that constructed and maintained golf courses, tennis courts, swimming pools, and other indoor and outdoor sports and recreational facilities. Gardpro bought class C common shares of stock. These are special corporate shares that entitled the registered owner to designate two nominees or representatives for membership in the Club. When Gardpro designated its corporate nominees, Forest Hills charged them membership fees of P50,000 (with 25,000 discount) each. At the time, the membership fee per nominee was increased from P45,000 to P75,000 each per resolution of the BOD. When Gardpro later changed its designated nominees, Forest Hills charged new membership fees, which Gardpro refused to pay, so the replacement did not take place. It was pointed out by the SEC En Banc that nowhere in the by-laws is there a provision that authorizes the collection of membership fees every time a nominee of corporate shareholder is to be replaced. What the by-laws authorizes is the collection of a “transfer fee,” in such amount as may be prescribed by the Board, for every change in the designated nominees of a juridical entity (a provision that should be differentiated from another by-laws provision that authorizes the collection of “transfer fee” of P60,000 for corporate members for each transfer of stock in the club's books.) Issue: Is the collection of new membership fees for replacement nominees allowed? (as within the prerogative of Forest Hills to determine its own rules and procedure governing membership and within the power of its Board of Directors to decide upon all questions on the construction of Articles of Incorporation, By-Laws and rules and regulations of the Club?) Ruling/Ratio: No, Forest Hills is not authorized under its articles of incorporation and by-laws to collect new membership fees for the replacement nominees of Gardpro. There is no question that Gardpro held class “C” common stocks that entitled it to two memberships in the Club. Its nominees could be admitted as regular members upon approval of the Board of Directors but only one nominee for each class “C” share as designated in the resolution could vote as such. … According to the second paragraph of Section 13.6 of the by-laws, the transfer of playing rights entailed the payment of P10,000. Yet, Section 2.2.2 of the by-laws stipulated a transfer fee for every replacement. This warranted the conclusion that Gardpro should pay to Forest Hills the transfer fee of P10,000 because it desired to change its nominees. There was an inconsistency between the by-laws of Forest Hills and the affidavit of the General Manager as to the amounts of the membership fees of corporate members. On one hand, Section 13.7 (Membership Fees) of the by-laws stated that “the membership fee of P45,000 x x x for corporate members must be paid by the applicant;” on the other, the General Manager’s affidavit alleged that “each nominee shall pay the P75,000 membership fee.” To resolve the inconsistency, the by-laws should prevail because they constituted the private statutes of the corporation and its members and must be strictly complied with and applied to the letter. The relevant provisions of the articles of incorporation and the by- laws of Forest Hills governed the relations of the parties as far as the issues between them were concerned. … On the other hand, the bylaws were the self-imposed rules resulting from the agreement between Forest Hills and its members to conduct the corporate business in a particular way. In that sense, the by-laws were the private “statutes” by which Forest Hills was regulated, and would function. The charter and the by-laws were thus the fundamental documents governing the conduct of Forest Hills’ corporate affairs; they established norms of procedure for exercising rights, and reflected the purposes and intentions of the incorporators. Until repealed, the by-laws were a continuing rule for the government of Forest Hills and its officers, the proper function being to regulate the transaction of the incidental business of Forest Hills. The by-laws constituted a binding contract as between Forest Hills and its members, and as between the members

themselves. Every stockholder governed by the by-laws was entitled to access them. The by-laws were self-imposed private laws binding on all members, directors and officers of Forest Hills. The prevailing rule is that the provisions of the articles of incorporation and the by-laws must be strictly complied with and applied to the letter. DILIGENCE REQUIRED OF BANKS Comsavings Bank (GSIS Family Bank) v. Sps. Capistrano GR No. 170942; August 28, 2013 Doctrine: A banking institution serving as an originating bank for the United Home Lending Program (UHLP) of the Government owes a duty to observe the highest degree of diligence and a high standard of integrity and performance in all its transactions with its clients because its business is imbued with public interest. Facts: Sps. Capistrano availed of the United Home Lending Program (UHLP) [implemented by the National Home Mortgage Finance Corporation (NHMFC)] to build a house on their owned lot. They executed a construction contract with the proprietor of GCB Builders. To finance the construction, GCB Builders facilitated the spouses’ loan application with Comsavings Bank, an originating bank of the UHLP. Comsavings Bank informed Mrs. Capistrano that she would have to sign various documents as part of the requirements for the release of the loan, which includes a certificate of house completion and acceptance. Later on, Comsavings informed Sps. Capistrano of the approval of an interim loan to be paid out from the proceeds of the NHMC loan. GCB Builders received the construction cost from Comsavings in four releases. The completion of the house was delayed that Sps. Capistrano demanded its completion. But the proprietor of GCB told them to give additional construction cost. Later on, the spouses received letter from NHMFC to start paying their loan that was released directly to Comsavings bank. Mrs. Capistrano visited the construction site and found that the house was still unfinished. The spouses sent a protest letter to NHMFC over the amortization payments considering that they had not signed any certificate of completion and acceptance, and that even if there was such a certification of completion and acceptance, it would have been forged. They sued GCB Builders, Comsavings Bank, and NHMFC. Comsavings bank averred that the spouses cannot question the signing of the certificate of house acceptance/completion since the spouses had the option not to presign the certificate and that it did not make any representation as to the conditions and facilitation of the loan with NHMFC because such representations were normal and regular requirements in loan processing of the conduit banks of NHMFC. Issue: Is Comsavings Bank solidarily liable with GCB Builders for the misrepresentation it did when it made the spouses pre-sign the certificate of house completion and acceptance even before the construction started? Ruling/Ratio: Yes, because it acted irregularly when it made Mrs. Capistrano sign the certificate when the house construction had not yet even started. Based on Articles 204 and 11705 of the Civil Code, a banking institution like Comsavings Bank is obliged to exercise the highest degree of diligence as well as high standards of integrity and performance in all its transactions because its business is imbued with public interest. … The stability of banks largely depends on the confidence of the people in the honesty and efficiency of banks.

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Article 20. Every person who, contrary to law, willfully or negligently causes damage to another, shall indemnify the latter for the same. 5 Article 1170. Those who in the performance of their obligations are guilty of fraud, negligence, or delay, and those who in any manner contravene the tenor thereof, are liable for damages.

There is no question that Comsavings Bank was grossly negligent in its dealings with respondents because it did not comply with its legal obligation to exercise the required diligence and integrity. As a banking institution serving as an originator under the UHLP and being the maker of the certificate of acceptance/completion, it was fully aware that the purpose of the signed certificate was to affirm that the house had been completely constructed according to the approved plans and specifications, and that the spouses had thereby accepted the delivery of the completed house. Given the purpose of the certificate, it should have desisted from presenting the certificate to Sps. Capistrano for their signature without such conditions having been fulfilled. But it made respondents sign the certificate despite the construction of the house not yet even starting. Its act was irregular per se because it contravened the purpose of the certificate. The pre-signing of the certificate was even fraudulent because it was thereby enabled to gain in the process the amount of P17,306.83 in the form of several deductions from the proceeds of the loan on top of other benefits as an originator bank. On the other hand, the spouses were prejudiced, considering that the construction of the house was then still incomplete and was ultimately defective. … Comsavings Bank should have been fair towards them as its clients, and therefore should not have made them pre-sign the certificate until it had confirmed that the construction of the house had been completed. CHANGE OF CORPORATE NAME Zuellig Freight and Cargo Systems v. NLRC G.R. No. 157900; July 22,2013 Doctrine: The mere change in the corporate name is not considered under the law as the creation of a new corporation; hence, the renamed corporation remains liable for the illegal dismissal of its employee separated under that guise. Facts: San Miguel filed an illegal dismissal case against his employer, Zuellig Freight and Cargo Systems, which was formerly known as Zeta Brokerage Corporation. He had been a checker/customs representative of Zeta since 1985. In June 1994, the employees were informed that Zeta would cease operations and that affected employees, including him, would be separated. He was informed by Zeta of his termination, reluctantly accepted his separation pay subject to the standing offer to be hired to his former position by Zuellig. Then he was summarily terminated. San Miguel contended that the amendments of the articles of incorporation of Zeta were for changing the corporate name, broadening the primary functions, and increasing the capital stock; and that such amendments could not mean that Zeta had been thereby dissolved. Issue: Was the change of name from Zeta Brokerage Corporation to Zuellig Freight and Cargo Systems a dissolution of Zeta as a corporation tantamount to closure of business as authorized cause of dismissal under the Labor Code? Ruling/Ratio: No, because Zeta and Zuellig remained to be one and the same corporation, since verily, the amendments of the articles of incorporation of Zeta to change the corporate name to Zuellig Freight and Cargo Systems, Inc. did not produce the dissolution of the former as a corporation. The Corporation Code defined and delineated the different modes of dissolving a corporation, and amendment of the articles of incorporation was not one of such modes. The effect of the change of name was not a change of the corporate being because the changing of the name of a corporation is no more the creation of a corporation than the changing of the name of a natural person is begetting of a natural person. The act, in both cases is a change of name, and not a change of being. A change in the corporate name does not make a new corporation, whether effected by a special act or under a general law. It has no effect on the identity of the corporation, or on its property, rights, or liabilities. The corporation, upon the change in its name, is in no sense a new corporation, nor the

successor of the original corporation. It is the same corporation with a different name, and its character is in no respect changed. In short, Zeta and Zuellig remained one and the same corporation. The change of name did not give Zuellig the license to terminate employees of Zeta like San Miguel without just or authorized cause. The situation was not like that of an enterprise buying the business of another company where the purchasing company had no obligation to rehire terminated employees of the latter. Zuellig, despite its new name, was the mere continuation of Zeta's corporate being, and still held the obligation to honor all of Zeta's obligations, one of which was to respect San Miguel's security of tenure. The dismissal of San Miguel from employment on the pretext that Zuellig, being a different corporation, had no obligation to accept him as its employee, was illegal and ineffectual. DOCTRINE OF SEPARATE JURIDICAL PERSONALITY Stronghold Insurance Company v. Cuenca G.R. No. 173297, March 6, 2013 Doctrine: The personality of a corporation is distinct and separate from the personalities of its stockholders. Hence, its stockholders are not themselves the real parties in interest to claim and recover compensation for the damages arising from the wrongful attachment of its assets. Only the corporation is the real party in interest for that purpose. Facts: Manuel Marañon filed with the RTC a collection case with an application for issuance of writ of preliminary attachment against the Cuencas. Marañon posted a bond issued by Stronghold Insurance. The writ of preliminary attachment was issued and was served to the Cuencas along with the summons and complaint. The sheriff levied upon the equipment, supplies, materials and various other personal property belonging to Arc Cuisine, Inc. that were found in the leased corporate office-cum-commissary or kitchen of the corporation. Later, the sheriff reported to the RTC among others that the attached properties are seen at a bakeshop owned by Marañon. The Cuencas filed a Motion to Require Sheriff to Deliver Attached Properties and to Set Case for Hearing, praying, among others, that Marañon should pay actual damages for the value of the lost attached properties because they are accountable and would turn over the amount to Art Cuisine. Marañon argued that since the attached properties belonged to Arc Cuisine, 50% of the stockholding of which the Cuencas owned, it should follow that 50% of the value of the missing attached properties constituted liquidating dividends that should remain with and belong to him. Issue: Could the Cuencas themselves recover damages arising from the wrongful attachment of the assets of Arc Cuisine Inc? Ruling/Ratio: No, because it is only Art Cuisine that had the right under substantive law to claim and recover such damages, which right could not be asserted by the Cuencas unless they did so in the name of the corporation itself. There is no dispute that the properties subject to the levy on attachment belonged to Arc Cuisine alone, not to the Cuencas in their own right. They were only stockholders of Arc Cuisine, Inc., which had a personality distinct and separate from that of any or all of them. The damages occasioned to the properties by the levy on attachment, wrongful or not, prejudiced Arc Cuisine, not them. In this case, however, Arc Cuisine was not even joined in the action either as an original party or as an intervenor. The Cuencas were clearly not vested with any direct interest in the personal properties coming under the levy on attachment by virtue alone of their being stockholders in Arc Cuisine. Their stockholdings represented only their proportionate or aliquot interest in the properties of the corporation, but did not vest in them any legal right or title to any specific properties of the corporation. Arc Cuisine remained the owner as a distinct legal person. Given the separate and distinct legal personality of Arc Cuisine, the

Cuencas lacked the legal personality to claim the damages sustained from the levy of the corporation’s properties. … Even when the foreclosure on the assets of the corporation was wrongful and done in bad faith, the stockholders had no standing to recover for themselves moral damages; otherwise, they would be appropriating and distributing part of the corporation’s assets prior to the dissolution of the corporation and the liquidation of its debts and liabilities. If at all, the case should have been brought by the Cuencas in behalf of the corporation, directly in the name of Arc Cuisine Inc. TRADEMARKS; TEST TO DETERMINE CONFUSING SIMILARITY; HOLISTIC TEST Diaz v. People of the Philippines G.R. No. 180677, February 18, 2013 Doctrine: It is the tendency of the allegedly infringing mark to be confused with the registered trademark that is the gravamen of the offense of infringement of a registered trademark. The acquittal of the accused should follow if the allegedly infringing mark is not likely to cause confusion. Facts: The DOJ filed two informations in the RTC, charging Victorio Diaz with violation of Sec. 155, in relation to Sec. 170 of the IP Code, alleging that Diaz was engaged in counterfeiting and colorably imitating Levi’s registered trademarks or dominant features thereof such as the: 1. leather patch showing two horses pulling a pair of pants

2. the arcuate pattern with the inscription “LEVI STRAUSS & CO” 3. the arcuate design that refers to “the two parallel stitching curving downward that are being sewn on both back pockets of a Levi’s Jeans

4. the tab or piece of cloth located on the structural seam of the right back pocket, upper left side.

Diaz allegedly sold and distributed such counterfeit patches and imitations of LEVI’S 501 in his tailoring shops. All these Levi’s trademarks were registered in the Philippine Patent Office in the 1970’s, 1980’s and early 1990’s. The NBI were able to seize several fake LEVI’S 501 jeans from Diaz. Diaz argued that he used the label “LS Jeans Tailoring” (which was registered with the IPO) in the jeans he made and sold. He added that the jeans were easily recognizable because the label “LS Jeans Tailoring” and the names of customers were placed inside the pockets, and each of the jeans had an “LSJT” red tab. “LS” stood for “Latest Style” and that the leather patch on his jeans had two buffaloes, not two horses. Issue: Did Diaz commit trademark infringement?

Ruling/Ratio: No, because applying the holistic test, the two marks are not confusingly similar. The likelihood of confusion is the gravamen of the offense of trademark infringement. The holistic test 6 is applicable in the case considering that the criminal cases also involved trademark infringement in relation to jeans products. Accordingly, the jeans trademarks of Levi’s Philippines and Diaz must be considered as a whole in determining the likelihood of confusion between them. The maong pants or jeans made and sold by Levi’s Phils., which included LEVI’S 501, were very popular in the Philippines. The consuming public knew that the original LEVI’S 501 jeans were under a foreign brand and quite expensive. Such jeans could be purchased only in malls or boutiques as ready-to-wear items, and were not available in tailoring shops like those of Diaz’s as well as not acquired on a “made-toorder” basis. Confusion and deception were remote. These are not your ordinary household items like catsup, soy sauce or soap which are of minimal cost. Maong pants or jeans are not inexpensive. Accordingly, the casual buyer is predisposed to be more cautious and discriminating in and would prefer to mull over his purchase.

Trademark

Levi’s “LEVI STRAUSS & CO”

Design

Two horse design

Red tab Classes of customers and channels of trade

Indicates the word “LEVI’S” Customers: mall goers belonging to class A and B market group

Petitioner “LS JEANS TAILORING”  The word “LS cannot be confused as a derivative from “LEVI STRAUSS” by virtue of the “LS” being connected to the word “TAILORING,” thereby openly suggesting that the jeans bearing the trademark “LS JEANS TAILORING” came or were bought from the tailoring shops of Diaz, not from malls or boutiques selling original LEVI’S 501 jeans Buffalo design  A horse and a buffalo are two different animals which an ordinary customer can easily distinguish Indicates the letters “LSJT” Customers: class D and E market who can only afford P300 for a pair of made-to-order pants

DOCTRINE OF PIERCING THE CORPORATE VEIL Gold Line Tours Inc. v. Heirs of Lacsa G.R. No. 159108, June 18, 2012 Doctrine: The veil of corporate existence of a corporation is a fiction of law that should not defeat the ends of justice. Whenever necessary for the interest of the public or for the protection of enforcement of their rights, the notion of legal entity should not and is not to be used to defeat public convenience, justify wrong, protect fraud or defend crime. Facts: Concepcion and Miriam Lacsa (sisters) boarded a Goldline passenger bus, driven by Rene Abania, and owned and operated by Travel & Tours Advisers Inc. enroute from Sorsogon to Cubao. The bus collided

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The holistic test considers the entirety of the marks, including labels and packaging, in determining confusing similarity. The focus is not only on the predominant words but also on the other features appearing on the labels.

with a passenger jeepney coming from the opposite direction. A metal part of the jeepney was detached and struck Concepcion in the chest, causing her instant death. Concepcion’s heirs filed a case for damages against Travel & Tours and Abania. Eventually, the case was decided in favor of Concepcion’s heirs and a tourist bus was levied. Gold Line Tours submitted a third-party claim asking the return of the levied bus claiming that it was the owner of said bus, that Gold Line was not a party to the Concepcion’s heirs’ case, and that it was a corporation entirely different from Travel & Tours. It was notable though that Gold Line’s Articles of Incorporation was amended shortly after Concepcion’s heirs filed the case against Travel & Tours. Issue: Should the veil of corporate existence be pierced in this case considering that William Ching, the owneroperator of Travel & Tours is also the President/Manager and incorporator of Gold Line Tours that claims to be the owner of the levied bus? Ruling/Ratio: Yes, because the notion that a corporation has an existence separate and/or distinct from its members is not applicable insofar as this case is concerned, because whenever necessary for the interest of the public or for the protection of enforcement of their rights, the notion of legal entity should not and is not to be used to defeat public convenience, justify wrong, protect fraud or defend crime. Where the main purpose in forming the corporation was to evade ones’ subsidiary liability for damages in a criminal case, the corporation may not be heard to say that it has a personality separate and distinct from its members, because to allow it to do so would be to sanction the use of fiction of corporate entity as a shield to further an end subversive of justice. … Gold Line might not be shielded from liability under the final judgment using the doctrine of separate corporate identity. Truly, this fiction of law could not be employed to defeat the ends of justice.

REMEDIAL LAW RULES OF PROCEDURE IN ARBITRATION; MODE OF APPEAL Andrew Fyfe et al vs. Philippine Airlines, Inc G.R. No. 160071, June 6, 2016 Doctrine: The Special Rules of Court on Alternative Dispute Resolution provides that the appropriate remedy from an order of the RTC vacating a domestic arbitral award is an appeal by petition for review in the CA under Rule 45, not an ordinary appeal under Rule 41 of the Rules of Court. Facts: The Respondent underwent rehabilitation proceedings, which resulted in the suspension of all claims for payment against it. To convince its creditors to approve the rehabilitation plan, the respondent decided to hire technical advisers. Respondent and Regent Star entered into a Technical Services Agreement (TSA) for the delivery of technical and advisory or management services. Petitioners were hired by Regent Star Services Ltd., who rendered their services to the respondent immediately after the TSA was executed. The respondent, however, sent a notice terminating the TSA on the ground of lack of confidence. Petitioners wrote to the respondent to seek clarification on the status of the TSA, but was unheeded. Thereafter, the petitioners initiated arbitration proceedings in the Philippine Dispute Resolution Center, Inc. (PDRCI) pursuant to the TSA. The PDRCI ordered the respondent to pay termination penalties. The respondent filed an Application to Vacate Arbitral Award before the RTC, which was granted. The RTC stressed that PAL is under receivership and the SEC’s order to suspend all claims for payment against PAL effectively deprived all other tribunals of jurisdiction to hear and decide all actions for claims against PAL for the duration of the receivership. Petitioners then appealed to the CA by notice of appeal. The CA dismissed the petitioners’ appeal stating that that the appropriate remedy against the order of the RTC vacating the award was a petition for review on certiorari under Rule 45. Issue/s: 1. Whether the CA erred in dismissing the appeal of the petitioners for being an inappropriate remedy. 2. Whether the Panel of Arbitrators had jurisdiction to hear and decide the petitioners' claim. Ruling/Ratio: 1. No, Section 29 of the Arbitration Law has limited the ground of review to "questions of law." Accordingly, the CA correctly dismissed the appeal of the petitioners because pursuant to Section 2, Rule 41 of the Rules of Court an appeal of questions of law arising in the courts in the first instance is by petition for review on certiorari under Rule 45. It is noted, however, that since the promulgation of the assailed decision by the CA on May 30, 2003, the law on the matter underwent changes. On February 4, 2004. Republic Act No. 9285 (Alternative Dispute Resolution Act of 2004) was passed by Congress, and was approved by the President on April 2, 2004. Pursuant to Republic Act No. 9285, the Court promulgated on September 1, 2009 in A.M. No. 07-11-08-SC the Special Rules of Court on Alternative Dispute Resolution, which are now the present rules of procedure governing arbitration. Among others, the Special Rules of Court on Alternative Dispute Resolution requires an appeal by petition for review to the CA of the final order of the RTC confirming, vacating, correcting or modifying a domestic arbitral award. Although the Special Rules of Court on Alternative Dispute Resolution provides that the appropriate remedy from an order of the RTC vacating a domestic arbitral award is an appeal by petition for review in the CA under Rule 45, not an ordinary appeal under Rule 41 of the Rules of Court, the Court cannot set aside and reverse the assailed decision on that basis because the decision was in full accord with the law or rule in force at the time of its promulgation.

2. No, the lower courts correctly opined that the SEC's suspension order effective July 1, 1998 deprived the arbitration panel of the jurisdiction to hear any claims against the respondent. Jurisprudence is settled that the suspension of proceedings referred to in the law uniformly applies to all actions for claims filed against a corporation, partnership or association under management or receivership, without distinction, except only those expenses incurred in the ordinary course of business. ANNULMENT OF JUDGMENT BASED ON COMPROMISE AGREEMENT Tung Hui Chung and Tong Hong Chung vs. Shih Chi Huang G.R. No. 170679, March 9, 2016 Doctrine: A compromise agreement has the effect and authority of res judicata between the parties, and is immediately final and executory, unless rescinded upon grounds that vitiate consent. Once stamped with judicial imprimatur, it is more than a mere contract between the parties. Any effort to annul the judgment based on compromise on the ground of extrinsic fraud must proceed in accordance with Rule 47 of the Rules of Court. Facts: Petitioners, filed a complaint to recover from the respondent a sum of money and damages (with prayer for a writ of attachment). The suit involved the contract to sell, whereby the respondent, as the vendor, undertook to deliver to the petitioners, as the vendees, shares of stock worth P10,606,266.00 in Island Information and Technology, Inc. The petitioners alleged that the respondent failed to deliver the shares of stock corresponding to the agreed amount on the date fixed by the contract. Later on, the parties filed their Joint Motion for Approval of a Compromise Agreement. The compromise agreement stipulated that the parties agreed to settle their respective claims and counterclaims in the amount of $250,000.00. The respondent did not pay the second installment despite demand. Instead, he filed in the CA a petition for annulment of judgment, seeking to nullify the order granting the application for the writ of attachment, and the order approving the compromise agreement. Meanwhile, the petitioners sought the execution of the judgment upon the compromise agreement on the ground of the respondent's failure to pay the second installment. Issue/s: Whether the judicial compromise agreement could no longer be assailed through certiorari because the lapse of time between the approval of the compromise agreement on October 20, 2003 and the filing of the petition for certiorari on March 7, 2005 had rendered the compromise agreement conclusive and immutable Ruling/Ratio: Yes, a compromise agreement is a contract whereby the parties make reciprocal concessions to avoid litigation or to put an end to one already commenced. It attains the authority and effect of res judicata upon the parties upon its execution, and becomes immediately final and executory, unless rescinded by grounds which vitiate consent. Once stamped with judicial imprimatur, it ceases to be a mere contract between the parties, and becomes a judgment of the court, to be enforced through writ of execution. The action before the CA was a special civil action for certiorari that had been brought on March 7, 2005, which was way beyond the period of 60 days from the rendition of the judgment based on the compromise agreement on October 20, 2003. Moreover, the grounds relied upon by the respondent in his petition for certiorari that the RTC had committed grave abuse of discretion tantamount to excess or lack of jurisdiction for issuing the writ of execution that was patently unjust, one-side, unfair, fraudulent and unconscionable compromise agreement; and for issuing the writ of execution of the compromise agreement that lacked consideration - were not proper grounds for assailing the judgment based on the compromise agreement.

Also, if the ground of the respondent to assail the judgment based on the compromise agreement was extrinsic fraud, his action should be brought under Rule 47. The remedy under Rule 47 is to be availed of only if the ordinary remedies of new trial, appeal, petition for relief or other appropriate remedies are no longer available through no fault of the petitioner. The respondent could have availed himself of the petition for relief from judgment under Rule 38. Hence, his failure to resort to such remedy precluded him from availing himself of the remedy to annul the judgment based on the compromise agreement. JUDGMENT ON THE PLEADINGS Fernando Medical Enterprises Inc. vs. Wesleyan University Philippines G.R. No. 207970, January 20, 2016 Doctrine: The trial court may render a judgment on the pleadings upon motion of the claiming party when the defending party's answer fails to tender an issue, or otherwise admits the material allegations of the adverse party's pleading. For that purpose, only the pleadings of the parties in the action are considered. It is error for the trial court to deny the motion for judgment on the pleadings because the defending party's pleading in another case supposedly tendered an issue of fact. Facts: Petitioner entered into several contracts with respondent to deliver and to install medical equipment and supplies at the respondent’s hospital. According to the petitioner, the respondent left unpaid the sum of P54,654,195.54. Later on, the parties entered into an agreement whereby the petitioner reduced its claim to only P50,400,000.00, and allowed the respondent to pay the adjusted obligation on installment basis within 36 months. However, the respondent’s new administration refused to pay the balance, claiming that the contracts were defective and rescissible due to economic prejudice or lesion. Due to the respondent’s failure to pay as demanded, the petitioner filed its complaint for sum of money. The petitioner filed its Motion for Judgment Based on the Pleadings, stating that the respondent had admitted the material allegations of its complaint and thus did not tender any issue as to such allegations. The lower courts denied the petitioner’s motion, stating that a judgment on the pleadings would be improper because the outstanding balance due to the petitioner remained to be an issue in the face of the allegations of the respondent in its complaint for rescission. Issue/s: Whether the CA erred in denying the petitioner’s motion for judgment on the pleadings Ruling/Ratio: Yes, the essential query in resolving a motion for judgment on the pleadings is whether or not there are issues of fact generated by the pleadings. Section 10, Rule 8 of the Rules of Court recognizes only three modes by which the denial in the answer raises an issue of fact. The first is by the defending party specifying each material allegation of fact the truth of which he does not admit and, whenever practicable, setting forth the substance of the matters upon which he relies to support his denial. The second applies to the defending party who desires to deny only a part of an averment, and the denial is done by the defending party specifying so much of the material allegation of ultimate facts as is true and material and denying only the remainder. The third is done by the defending party who is without knowledge or information sufficient to form a belief as to the truth of a material averment made in the complaint by stating so in the answer. Any material averment in the complaint not so specifically denied are deemed admitted except an averment of the amount of unliquidated damages. Here, the respondent expressly admitted paragraphs related to the petitioner’s allegations on: (a) the four transactions for the delivery and installation of various hospital equipment; (b) the total liability of the respondent; (c) the payments made by the respondents; (d) the balance still due to the petitioner; and (e) the execution of agreement. With the consequent admission engendered by petitioners’ failure to properly deny the Acknowledgment in their Answer, coupled with its proper authentication, identification and offer

by the respondent, not to mention petitioners’ admissions in paragraphs 4 to 6 of their Answer that they are indeed indebted to respondent, the Court believes that judgment may be had solely on the document, and there is no need to present receipts and other documents to prove the claimed indebtedness. PRELIMINARY INJUNCTION The City of Iloilo, represented by Hon. Mayor Jerry Treñas vs. Hon. Judge Rene Honrado, Presiding Judge of RTC Branch 29 Iloilo City and JPV Motor Vehicle Emission Testing and Car Care Center December 9, 2015, G.R. No. 160399 Doctrine: The essential office of preliminary injunction is to preserve the rights of the parties before the final adjudication of the issues. Where injunction is the main relief sought in the action, therefore, the trial court should desist from granting the plaintiff's application for temporary restraining order or writ of preliminary injunction if such grant would tend to prejudge the case on the merits. The preliminary injunction should not determine the merits of the case, or decide controverted facts, but should still look to a future final hearing. Facts: The Department of Transportation and Communications (DOTC) issued Department Order No. 2002-31 (with the subject "AUTHORIZATION OF PRIVATE EMISSION TESTING CENTERS"). Item No. 2 of Department Order No. 2002-31 stated: one (1) Private Emission Testing Center (PETC) lane shall be authorized for every 15,000 registered vehicles in an LTO Registering District. JPV Motor Vehicle Emission Testing and Car Care Center (JPV), a partnership authorized to operate a PETC in Iloilo City, was granted a capacity of four lanes that could cater to 15,000 motor vehicles per lane for the total capacity of 60,000 motor vehicles. At the time JPV filed a civil complaint to prevent the petitioner from acting on the pending application for the operation of another PETC in Iloilo City because it already had the capability to serve all the registered motor vehicles in Iloilo City pursuant to Department Order No. 2002-31. The RTC granted JPV’s application for the writ of preliminary injunction. Hence, petitioner challenged the RTC’s decision directly before this Court on certiorari. Issue/s: Whether the RTC committed grave abuse of discretion amounting to lack or excess of jurisdiction in ordering petitioner City Mayor of Iloilo and his representatives to desist from issuing a mayor’s permit to operate a PETC in the city. Ruling/Ratio: Yes, a preliminary injunction is an order granted at any stage of an action or proceeding prior to the judgment or final order requiring a party or a court, an agency, or a person to refrain from a particular act or acts. Its essential role is preservative of the rights of the parties in order to protect the ability of the court to render a meaningful decision, or in order to guard against a change of circumstances that will hamper or prevent the granting of the proper relief after the trial on the merits. Another essential role is preventive of the threats to cause irreparable harm or injury to a party before the litigation could be resolved. Section 3, Rule 58 of the Rules of Court set the guidelines for when the issuance of a writ of preliminary injunction is justified, namely: (a) when the applicant is entitled to the relief demanded, and the whole or part of such relief consists in restraining the commission or continuance of the act or acts complained of, or in requiring the performance of an act or acts, either for a limited period or perpetually; or (b) when the commission, continuance or non-performance of the act or acts complained of during the litigation would probably work injustice to the applicant; or (c) when a party, court, agency or a person is doing, threatening, or is attempting to do, or is procuring or suffering to be done, some act or acts probably in violation of the rights of the applicant respecting the subject of the action or proceeding, and tending to render the judgment ineffectual.

The prevailing rule is that courts should avoid issuing a writ of preliminary injunction which would in effect dispose of the main case without trial. The granting of JPV's application already amounted to the virtual acceptance of JPV's alleged entitlement to preventing the petitioner from considering and passing upon the applications of other parties to operate their own PETC in Iloilo City based on JPV's still controversial capability to serve all the registered motor vehicles in Iloilo City pursuant to Department Order No. 200231. The granting amounted to the prejudgment of the merits of the case, something the RTC could not validly do. For a petition for certiorari and prohibition to prosper and be given due course, it must be shown that: (a) the respondent judge or tribunal issued the order without or in excess of jurisdiction or with grave abuse of discretion; or (b) the assailed interlocutory order is patently erroneous, and the remedy of appeal cannot afford adequate and expeditious relief. Yet, the allegation that the tribunal, board or officer exercising judicial or quasi-judicial functions has acted without or in excess of its or his jurisdiction or with grave abuse of discretion will not alone suffice. Equally imperative is that the petition must satisfactorily specify the acts committed or omitted by the tribunal, board or officer that constitute grave abuse of discretion. APPEAL FROM FINAL ORDERS OF VOLUNTARY ARBITRATOR Rogelio Baronda vs. Court of Appeals G.R. No. 161006, October 14, 2015 Doctrine: The order issued by the Voluntary Arbitrator is a final order, as contrasted from a merely interlocutory order, because its issuance left nothing more to be done or taken by the Voluntary Arbitrator in the case. The proper remedy from such order was to appeal to the CA by petition for review under Rule 43 of the Rules of Court. Facts: Private respondent Hideco Sugar Milling Co., Inc. (HIDECO) employed the petitioner as a mud press truck driver. Petitioner hit HIDECO's transmission lines while operating a dump truck, causing a total factory blackout. Power was eventually restored but the restoration cost HIDECO damages totaling P26,481.11. Petitioner was eventually dismissed by HIDECO on the ground of gross negligence. He filed in the Office of the Voluntary Arbitrator of the National Conciliation and Mediation Board in Tacloban City a complaint for illegal dismissal against HIDECO. Voluntary Arbitrator Antonio C. Lopez, Jr. handled the case and eventually rendered his decision finding the petitioner's dismissal illegal, and ordering his reinstatement. Hence, HIDECO reinstated the petitioner. Petitioner filed his manifestation with motion for the issuance of the writ of execution in the Office of the Voluntary Arbitrator, praying for the execution of the decision, and insisting on being entitled to backwages, unpaid wages, 13th month pay and bonuses from January 16, 2001, the date when his reinstatement was effected, until his actual reinstatement. HIDECO opposed because the items prayed for are not included in the dispositive portion of the decision of the voluntary arbitrator, neither are the said items mentioned in any part of the same decision. The Voluntary Arbitrator granted the petitioner's motion for execution. Having received a copy of the order, HIDECO instituted a special civil action for certiorari in the CA. the CA considered the petition for certiorari filed by private respondent as one filed under Rule 43 and ruled in favor of HIDECO. It held that the voluntary arbitrator had issued the writ of execution despite his decision lacking such award for backwages and other benefits. Issue/s: 1. Whether the CA erred in granting HIDECO's petition for certiorari. 2. Whether the reinstatement aspect of the Voluntary Arbitrator's decision was executory pending appeal.

Ruling/Ratio: 1. Yes, the order issued by the Voluntary Arbitrator was a final order, as contrasted from a merely interlocutory order, because its issuance left nothing more to be done or taken by the Voluntary Arbitrator in the case. It thus completely disposed of what the reinstatement of the petitioner as ordered by the Voluntary Arbitrator. The proper remedy from such order was to appeal to the CA by petition for review under Rule 43 of the Rules of Court. Yet, HIDECO filed the petition for certiorari, and the CA liberally treated the petition for certiorari as a petition for review under Rule 43. Such treatment by the CA was procedurally unwarranted. 2. Yes, although the timely filing of a motion for reconsideration or of an appeal forestalls the finality of the decision or award of the Voluntary Arbitrator, the reinstatement aspect of the Voluntary Arbitrator's decision or award remains executory regardless of the filing of such motion for reconsideration or appeal. The immediate reinstatement of the employee pending the appeal has been introduced by Section 12 of Republic Act No. 6715, which amended Article 223 of the Labor Code. WRIT OF EXECUTION National Housing Authority vs. Ernesto Roxas G.R. No. 171953, October 21, 2015 Doctrine: No court should issue a writ of execution upon any monetary judgment rendered against the NHA unless such monetary judgment is first submitted to and passed upon by the Commission on Audit (COA). Facts: The NHA is charged with the development of the Dagat-dagatan Development Project (project) in Navotas. Roxas applied for commercial lots in the project for the use of his business of buying and selling gravel, sand and cement products. The NHA approved his application and the notice of award for the lots in favor of Roxas. Roxas completed his payment for the subject lots. The NHA informed Roxas about the increase in the area of the subject lots, and approved the award of the additional area of 144 square meters to him at P3,500.00/square meter. Although manifesting his interest in acquiring the additional area, he appealed for the reduction of the price to P1,500.00/square meter. The NHA rejected his appeal so he commenced in the RTC this action for specific performance and damages, with prayer for the issuance of a writ of preliminary injunction. The RTC and CA ruled in favor of Roxas. NHA sought to undo the adverse decision of the CA through its petition for certiorari. However, this Court dismissed the petition for certiorari. Subsequently, Roxas filed his motion for the issuance of the writ of execution, which the RTC granted. In order to prevent the execution, the NHA brought another petition for certiorari in the CA. The CA dismissed the NHA's petition for certiorari through the presently assailed decision because it found that the RTC did not gravely abuse its discretion amounting to lack or excess of jurisdiction in granting Roxas' motion for the issuance of the writ of execution. Issue/s: Whether the money judgment awarded to Roxas could not be recovered by motion for execution but should have been first filed in the COA.

Ruling/Ratio: Yes, section 26 of Presidential Decree No. 1445, specifically vested in the COA the power, authority and duty to examine, audit and settle "all debts and claims of any sort" due from or owing to the Government, or any of its subdivisions, agencies, or instrumentalities, including government-owned and controlled corporations with original charters. Government funds and property may not be seized pursuant to writs of execution or writs of garnishment to satisfy judgments. The functions and public services of the State cannot be allowed to be paralyzed or disrupted by the diversion of public fund from their legitimate and specific objects, and as appropriated by law. The rule is based on obvious considerations of public policy. WARRANT OF ARREST; PROBABLE CAUSE Mayor Anwar Berua vs. Court of Appeals G.R. No. 177600, October 19, 2015 Doctrine: The issuance by the trial court of the warrant of arrest upon filing of the information and supporting papers implies the determination of probable cause for the offense charged. It is then superfluous for the accused to seek the judicial determination of probable cause on the pretext that the trial court should still act and proceed independently of the executive determination of probable cause to charge the proper offense. Facts: A shooting incident took place in Lanao del Sur that resulted in the death of Dante Limbona and Ante Maguindanao, and the serious wounding of Azis Panda and Kiri Hadji Salik. In the course of the preliminary investigation the investigating prosecutor found probable cause to charge private respondents with Double Murder with Multiple Frustrated Murder. However, after reinvestigation ordered by the trial court, the Office of the Provincial Prosecutor downgraded the charges against private respondents. Private complainant Zenaida Limbona, the widow of the victim Limbona, filed a petition for review questioning the Provincial Prosecutor's Resolution before the DOJ. Then Secretary Serafin Cuevas modified the assailed resolution and directed the Provincial Prosecutor to file instead "two (2) informations for frustrated murder with attempted murder, two (2) informations for frustrated murder and an information for attempted murder" against private respondents. Later, the criminal cases were re-raffled to the RTC of Quezon City, which found probable cause to charge private respondents for Murder with Attempted Murder in Criminal Case No. Q-01-99899293, Frustrated Murder in Criminal Case No. Q-01-100542-43, and Attempted Murder in Criminal Case No. Q-01-100594. The warrants of arrest were accordingly issued against private respondents, who, undaunted, went up to the Supreme Court to question the Decision of the Court of Appeals by way of a petition for review on certiorari docketed as G.R. No. 159962. The SC denied the petition on June 2006 and held that "there is no longer any obstacle to the implementation of the existing warrants of arrest.” Nonetheless, private respondents then filed before RTC-Branch 83 a Motion to Re-Determine the Existence or Non-Existence of Probable Cause Which May Even Warrant Dismissal - Even of the Appropriate Charges of Homicide, Frustrated and Attempted Homicides. Respondent Judge Lee issued the assailed Order granting private respondents' motion for redetermination of probable cause and consequently ordering the downgrading of the crimes charged. The cases were then re-raffled to RTCBranch 77, presided by respondent Judge Vivencio S. Baclig, who then issued the second assailed Order denying a Motion for Reconsideration of the 12 May 2006 Order issued by respondent Judge Lee. Aggrieved by the orders of Judge Ralph S. Lee and Judge Vivencio S. Baclig, the State, through the Office of Solicitor General, commenced a special civil action for certiorari in the CA. The CA declared the assailed orders of Judge Lee and Judge Baclig to be in clear defiance of this Court's June decision in G.R. No. 159962.

Issue/s: Whether the respondents were precluded from still seeking from the RTC the judicial determination of probable cause against them because all that the Court had upheld in G.R. No. 159962 was only the executive determination of probable cause. Ruling/Ratio: Yes, rule 112 of the Rules of Court provides: Sec. 6. When warrant of arrest may issue. — (a) By the Regional Trial Court. — Within ten (10) days from the filing of the complaint or information, the judge shall personally evaluate the resolution of the prosecutor and its supporting evidence. He may immediately dismiss the case if the evidence on record clearly fails to establish probable cause. If he finds probable cause, he shall issue a warrant of arrest, or a commitment order if the accused has already been arrested pursuant to a warrant issued by the judge who conducted the preliminary investigation when the complaint or information was filed pursuant to section 7 of this Rule. In case of doubt on the existence of probable cause, the judge may order the prosecutor to present additional evidence within five (5) days from notice and the issue must be resolved by the court within thirty (30) days from the filing of the complaint or information. The trial judge, by issuing the warrants of arrest, already found the existence of probable cause against Balindong, et al. Indeed, the act of issuing the warrant of arrest upon filing of the information and supporting papers implied that the judge has determined the existence of probable cause for the offenses charged. It is then superfluous for the accused to seek the judicial determination of probable cause on the pretext that the trial court should still act and proceed independently of the executive determination of probable cause to charge the proper offense. Balindong, et al. could not reasonably support their position that they could still have the trial court determine the existence of probable cause in their criminal cases independently of the executive determination of probable cause by the DOJ by relying on Section 14, Rule 110, in relation to Section 19, Rule 119, both of the Rules of Court. Section 14 applies only to a situation in which there has been a mistake on the part of public prosecutor in charging the proper offense. Here, there was no mistake in charging the proper offenses. SPECIAL PROCEEDINGS; INTERVENTION; APPEAL Nilo Chiongian vs. Victoria Benitez-Lirio et al G.R. No. 162692, August 26, 2015 Doctrine: Under Section 3 of Rule 41, a party who wants to appeal a judgment or final order in special proceedings has 30 days from notice of the judgment or final order within which to perfect an appeal because he will be filing not only a notice of appeal but also a record on appeal that will require the approval of the trial court with notice to the adverse party. Failure to perfect the appeal within the prescribed time rendered the judgment final and beyond review on appeal. Facts: The late Vicente Benitez was married to Isabel Chipongian, the petitioner's sister. Isabel had predeceased Vicente. After the death of Isabel, Vicente and the petitioner had executed a deed of extrajudicial settlement respecting the estate of Isabel, whereby the latter waived all his rights to the estate of Isabel in favor of Vicente. According to the petitioner, however, Vicente executed an affidavit on the same date whereby he affirmed that the waiver did not extend to the paraphernal properties of Isabel. Upon the death of Vicente, Victoria, a sister of Vicente, and Feodor, a nephew of Vicente, initiated proceedings for the settlement of the estate of Vicente. The petitioner intervened in the Special Proceeding. He sought to exclude the paraphernal properties of Isabel from inclusion in the estate of Vicente based on the affidavit of Vicente. The petitioner specifically moved for the exclusion of the paraphernal properties of Isabel from Vicente's estate. However, he withdrew the motion even before the

RTC could rule on it. Instead, he filed a Motion for Leave to Intervene and to Admit Complaint-inIntervention. The RTC Dismissed the complaint. The petitioner then instituted a petition for certiorari in the CA, alleging that the RTC had committed grave abuse of discretion amounting to lack or excess of jurisdiction in dismissing his appeal on the ground that it had been filed beyond the reglementary period. The CA dismissed the petition for certiorari. Issue/s: Whether the CA gravely abused its discretion in dismissing his petition for certiorari Ruling/Ratio: No, intervention is a remedy by which a third party, not originally impleaded in the proceedings, becomes a litigant therein to enable him, her or it to protect or preserve a right or interest which may be affected by such proceedings. If an intervention makes a third party a litigant in the main proceedings, his pleadingin-intervention should form part of the main case. Accordingly, when the petitioner intervened in Special Proceedings No. SP-797, his complaint-in-intervention, once admitted by the RTC, became part of the main case, rendering any final disposition thereof subject to the rules specifically applicable to special proceedings, including Rule 109 of the Rules of Court, which deals with appeals in special proceedings. Section 1 of Rule 41 enunciates the final judgment rule by providing that an appeal "may be taken from a judgment or final order that completely disposes of the case, or of a particular matter therein when declared by these Rules to be appealable." The dismissal of the petitioner's intervention constituted "a final determination in the lower court of the rights of the party appealing," that is, his right in the paraphernal properties of his deceased sister. Under Section 3 of Rule 41, a party who wants to appeal a judgment or final order in special proceedings has 30 days from notice of the judgment or final order within which to perfect an appeal because he will be filing not only a notice of appeal but also a record on appeal that will require the approval of the trial court with notice to the adverse party. For the petitioner, therefore, the period for perfecting the appeal by record on appeal was 30 days from notice of the final order dismissing the intervention. The start of the period of 30 days happened on September 18, 1998, the date when his counsel received the decision dismissing his intervention. However, the entire time from the filing of his Motion for Reconsideration on October 2, 1998 until his receipt of the denial of the Motion for Reconsideration on March 18, 1999 should be deducted from the reckoning of the period to perfect his appeal. He filed the notice of appeal on March 19, 1999, and paid the appellate court docket fees on March 31, 1999. Considering that the petitioner did not submit a record on appeal in accordance with Section 3 of Rule 41, he did not perfect his appeal of the judgment dismissing his intervention. As a result, the dismissal became final and immutable. The right to appeal, being statutory in nature, required strict compliance with the rules regulating the exercise of the right. As such, his perfection of his appeal within the prescribed period was mandatory and jurisdictional, and his failure to perfect the appeal within the prescribed time rendered the judgment final and beyond review on appeal. CONTENTS OF PETITION; EFFECT OF NON-COMPLIANCE Charlie Te vs. Hon. Augusto Breva G.R. No. 164974, August 5, 2015 Doctrine: If the search warrant had been issued in the name of the People of the Philippines, that fact rendered the People of the Philippines to be indispensable parties in the special civil action for certiorari. Hence, the petition must be dismissed for failure to implead the People of the Philippines as respondents. Facts: Respondent Presiding Judge issued a search warrant against the petitioner on the basis of his finding of probable cause for a violation of Section 2(b) of Batas Pambansa Blg. 33, as amended by Presidential

Decree No. 1865, for hoarding large quantities of liquefied petroleum gas (LPG) in steel cylinders belonging to respondent Pryce Gases, Inc. The petitioner presented his Omnibus Motion to Quash Warrant and/or Suppress Evidence and to Order Return of Seized Items, raising therein the lack of probable cause, failure to specify the single offense committed, illegality of the nighttime search, improper application of the plain view doctrine, and inclusion of other offenses. Respondent Presiding Judge denied the petitioner's motion by observing that he had issued the search warrant for one specific offense; that there was probable cause to issue the search warrant; that the search began late in the day and continued into the night, but the actual seizure was carried out in the daytime of the next day; and that the seizure of the blue cylinders with the markings and logo of Pryce Gases was justified under the plain view doctrine because they were found among the large stockpile of cylinders in the petitioner's warehouse. The petitioner assailed the order on certiorari, but the CA dismissed the petition for failure to implead the People of the Philippines as respondents, and for lack of any showing that a copy of the petition had been served on the OSG. Issue/s: Whether the failure to implead the People of the Philippines as an indispensable party is a fatal defect Ruling/Ratio: Yes, impleading the People of the Philippines in the petition for certiorari did not depend on whether or not an actual criminal action had already been commenced in court against the petitioner. It cannot be denied that the search warrant in question had been issued in the name of the People of the Philippines, and that fact rendered the People of the Philippines indispensable parties in the special civil action for certiorari brought to nullify the questioned orders of respondent Presiding Judge. We also note that the impleading is further expressly demanded in Section 3, Rule 46 of the Rules of Court: Section 3. Contents and filing of petition; effect of non-compliance with requirements. - The petition shall contain the full names and actual addresses of all the petitioners and respondents. a concise statement of the matters involved. the factual background of the case, and the grounds relied upon for the relief prayed for. x x x The failure of the petitioner to comply with any of the foregoing requirements shall be sufficient ground for the dismissal of the petition. The petitioner could have quickly rectified his omission by the immediate amendment of the petition. However, although made aware of the omission as a fatal defect, he did not cause the amendment but continued to ignore the need to amend. ANNULMENT OF JUDGMENT; JURISDICTION Berlinda Oribello vs. Court of Appeals and Remedios Oribello August 5, 2015, G.R. No. 163504 Doctrine: No court has the authority to nullify the judgments or processes of another court of equal rank and category, having the equal power to grant the reliefs sought. Such power devolves exclusively upon the proper appellate court. The reason for the rule is to avoid conflict of power between different courts of equal or coordinate jurisdiction which would surely lead to confusion and seriously hinder the proper administration of justice. Facts: Toribio was twice married. Toribio's marriage to his first wife was dissolved. He subsequently married appellee in La Union. Toribio died intestate. Remedios Oribello, represented by her natural father Alfredo Selga filed an action against appellee for partition and damages involving several parcels of land, which were under Toribio’s name. the action was anchored on the theory that appellant is an adopted daughter

of Toribio per a decision of the CFI. Denying that appellant is an adopted daughter of Toribio, appellee averred in her answer that the decree of adoption was fraudulently secured by Alfredo. Issue/s: Whether the validity of the adoption decree in favor of the respondent should NOT be assailed in an action for partition Ruling/Ratio: Yes, a petition for annulment of judgment is a remedy in equity so exceptional in nature that it may be availed of only when other remedies are wanting, and only if the judgment, final order or final resolution sought to be annulled was rendered by a court lacking jurisdiction or through extrinsic fraud. Yet, the remedy, being exceptional in character, is not allowed to be so easily and readily abused by parties aggrieved by the final judgments, orders or resolutions. The Court has thus instituted safeguards by limiting the grounds for the annulment to lack of jurisdiction and extrinsic fraud, and by prescribing in Section 1 of Rule 47 of the Rules of Court that the petitioner should show that the ordinary remedies of new trial, appeal, petition for relief or other appropriate remedies are no longer available through no fault of the petitioner. The attitude of judicial reluctance towards the annulment of a judgment, final order or final resolution is understandable, for the remedy disregards the time-honored doctrine of immutability and unalterability of final judgments, a solid corner stone in the dispensation of justice by the courts. The doctrine of immutability and unalterability serves a two-fold purpose, namely: (a) to avoid delay in the administration of justice and thus, procedurally, to make orderly the discharge of judicial business; and (b) to put an end to judicial controversies, at the risk of occasional errors, which is precisely why the courts exist. Based on the foregoing, the RTC did not have the jurisdiction to determine or to review the validity of the decree of adoption issued by the CFI of Occidental Mindoro by virtue of the equal rank and category between the RTC and the CFI. Indeed, no court has the authority to nullify the judgments or processes of another court of equal rank and category, having the equal power to grant the reliefs sought. Such power devolves exclusively upon the proper appellate court. The reason for the rule is to avoid conflict of power between different courts of equal or coordinate jurisdiction which would surely lead to confusion and seriously hinder the proper administration of justice.

LEGAL ETHICS QUALIFICATIONS FOR ADMISSION TO THE BAR Ma. Cecilia Advincula vs. Atty. Leonardo Advincula A.C. No. 9226, June 14, 2016 Doctrine: The good moral conduct or character must be possessed by lawyers at the time of their application for admission to the Bar, and must be maintained until retirement from the practice of law. It is expected that every lawyer, being an officer of the Court, must not only be in fact of good moral character, but must also be seen to be of good moral character and leading lives in accordance with the highest moral standards of the community. Facts: Dr. Advincula averred that while Atty. Advincula was still married to her, he had extra-marital sexual relations with Ma. Judith Ortiz Gonzaga and their relations bore a child named Alexandria. Atty. Advincula failed to give financial support to their own children, despite his having sufficient financial resources. He admitted in the affidavit of late registration of birth of Alexandria that he had contracted another marriage with Ms. Gonzaga; that even should Atty. Advincula prove that his declaration in the affidavit of late registration of birth was motivated by some reason other than the fact that he truly entered into a subsequent marriage with Ms. Gonzaga, then making such a declaration was in itself still unlawful; that making a false declaration before a notary public was an unlawful conduct punishable under the RPC. Dr. Advincula prayed that Atty. Advincula be disbarred. Issue: Whether or not respondent must be disbarred. Ruling/Ratio: No. The good moral conduct or character must be possessed by lawyers at the time of their application for admission to the Bar, and must be maintained until retirement from the practice of law. It is expected that every lawyer, being an officer of the Court, must not only be in fact of good moral character, but must also be seen to be of good moral character and leading lives in accordance with the highest moral standards of the community. More specifically, a member of the Bar and officer of the Court is required not only to refrain from adulterous relationships or keeping mistresses but also to conduct himself as to avoid scandalizing the public by creating the belief that he is flouting those moral standards. If the practice of law is to remain an honorable profession and attain its basic ideals, whoever is enrolled in its ranks should not only master its tenets and principles but should also, in their lives, accord continuing fidelity to them. The requirement of good moral character is of much greater import, as far as the general public is concerned, than the possession of legal learning. Although his siring the child with a woman other than his legitimate wife constituted immorality, he committed the immoral conduct when he was not yet a lawyer. The degree of his immoral conduct was not as grave than if he had committed the immorality when already a member of the Philippine Bar. Even so, he cannot escape administrative liability. Taking all the circumstances of this case into proper context, the Court considers suspension from the practice of law for three months to be condign and appropriate. Atty. Advincula manifested in his compliance that he had immediately accepted the resolution of the IBP Board of Governors suspending him from the practice of law for two months as final and executory; that he had then gone on leave from work in the NBI for two months; and that such leave from work involved refraining from performing his duties. A lawyer like him ought to know that it is only the Court that wields the power to discipline lawyers. The IBP Board of Governors did not possess such power, rendering its recommendation against him incapable of finality. It is the Court's final determination of his liability as a lawyer that is the reckoning point for the service of sanctions and penalties. As such, his supposed compliance with the recommended two-month suspension could not be satisfied by his going on leave from his work at the NBI. Moreover, his being a government employee necessitates that his suspension from the practice of

law should include his suspension from office. A leave of absence will not suffice. This is so considering that his position mandated him to be a member of the Philippine Bar in good standing. The suspension from the practice of law will not be a penalty if it does not negate his continuance in office for the period of the suspension. If the rule is different, this exercise of reprobation of an erring lawyer by the Court is rendered inutile and becomes a mockery because he can continue to receive his salaries and other benefits by simply going on leave for the duration of his suspension from the practice of law.

ATTORNEY’S FEES; QUANTUM MERUIT Nenita Sanchez vs. Atty Romeo Aguilos A.C. No. 10543, March 16, 2016 Doctrine: The attorney’s fees shall be those stipulated in the retainer’s agreement between the client and the attorney, which constitutes the law between the parties for as long as it is not contrary to law, good morals, good customs, public policy or public order. In the absence of the written agreement, the lawyer’s compensation shall be based on quantum meruit, which means “as much as he deserved.” Facts: Complainant Nenita Sanchez has charged respondent with misconduct for the latter's refusal to return the amount she had paid for his professional services despite his not having performed the services. She avers that she sought the legal services of the respondent to represent her in the annulment of her marriage; that the respondent accepted the engagement, fixing his fee at P150,000, plus the appearance fee of P5,000/hearing; that she then gave to him the initial amount of P90,000; that she had gone to his residence to inquire on the developments in her case, but he told her that he would only start working on the case upon her full payment of the acceptance fee; that she had only learned then that what he had contemplated to file for her was a petition for legal separation, not one for the annulment of her marriage; that he further told her that she would have to pay a higher acceptance fee for the annulment of her marriage; that she subsequently withdrew the case from him, and requested the refund of the amounts already paid, but he refused to do the same as he had already started working on the case; that she had sent him a letter to demand the return of her payment less whatever amount corresponded to the legal services he had already performed; that the respondent did not heed her demand letter despite his not having rendered any appreciable legal services to her; and that prompted her to bring an administrative complaint against him in the IBP. Issue: Does quantum meruit attach when an attorney fails to accomplish tasks which he is naturally expected to perform during his professional engagement? Ruling/Ratio: No. Respondent was liable for misconduct, and he should be ordered to return the entire amount received from the client. Respondent misrepresented his professional competence and skill to the complainant. He did not know the distinction between the grounds for legal separation and for annulment of marriage. Such knowledge would have been basic and expected of him as a lawyer accepting a professional engagement for either causes of action. His explanation that the client initially intended to pursue the action for legal separation should be disbelieved. The case unquestionably contemplated by the parties and for which his services was engaged, was no other than an action for annulment of the complainant’s marriage with her husband. They did not contemplate legal separation at all, for legal separation would still render her incapacitated to re-marry. That the respondent was insisting in his answer that he had prepared a petition for legal separation, and that she had to pay more as attorney’s fees if she desired to have the action for annulment was, therefore, beyond comprehension other than to serve as a hallow afterthought to justify his claim for services rendered. As such, the respondent failed to live up to the standards imposed on him as an attorney. He thus transgressed Canon 18, and Rules 18.01, 18.02 and 18.03 of the CPR.

Every attorney is entitled to have and receive a just and reasonable compensation for services performed at the special instance and request of his client. As long as the attorney is in good faith and honestly trying to represent and serve the interests of the client, he should have a reasonable compensation for such services. The attorney’s fees shall be those stipulated in the retainer’s agreement between the client and the attorney, which constitutes the law between the parties for as long as it is not contrary to law, good morals, good customs, public policy or public order. In the absence of the written agreement, the lawyer’s compensation shall be based on quantum meruit, which means “as much as he deserved.” The determination of attorney’s fees on the basis of quantum meruit is also authorized “when the counsel, for justifiable cause, was not able to finish the case to its conclusion.” Moreover, quantum meruit becomes the basis of recovery of compensation by the attorney where the circumstances of the engagement indicate that it will be contrary to the parties’ expectation to deprive the attorney of all compensation. The respondent should not have accepted the engagement because it was way above his ability and competence to handle the case for annulment of marriage. As a consequence, he had no basis to accept any amount as attorney’s fees from the complainant. He did not even begin to perform the contemplated task he undertook for the complainant because it was improbable that the agreement with her was to bring the action for legal separation. His having supposedly prepared the petition for legal separation instead of the petition for annulment of marriage was either his way of covering up for his incompetence, or his means of charging her more. Either way did not entitle him to retain the amount he had already received. RULE 139-B The Christian Spiritists in the Philippines, Inc. vs. Atty. Daniel Mangallay A.C. No. 10483, March 16, 2016 Doctrine: Under the revisions of Rule 139-B, the administrative complaints against attorneys are generally not dismissed outright but are instead referred for investigation, report and recommendation either to the IBP, or the Office of the Bar Confidant (OBC), or any office of the Court or even a judge of a lower court. Facts: Pante avers that the CSP-PLC constructed its church building on the land owned by Maria Omiles. Omiles and Pastor Maliked received the summons issued by the Municipal Trial Court (MTC) requiring them to answer the complaint for unlawful detainer filed against them by the respondent. The respondent claimed ownership of the land where the church had been erected, attaching the copy of deed of absolute sale executed between him and one Pedro Loy. The MTC later on decided the case by declaring the respondent to have the better right of possession. The respondent sought and obtained the writ of execution from the MTC after the defendants, including the complainant, reneged on the promise to voluntarily vacate and surrender the premises in consideration of the respondent’s financial assistance. The writ of execution and the writ of demolition were issued. The sheriffs, accompanied by the respondent and elements of the PNP, implemented the writ of execution and writ of demolition. Pante now insists that the demolition was done without a demolition order from the MTC; that the respondent had taken advantage of his legal knowledge to cause the premature demolition of the structures sans the demolition order; that such taking away of the dismantled materials constituted robbery and malicious mischief; and that his act warranted his disbarment. Issue: Whether or not respondent must be disbarred Ruling/Ratio: No. Under the revisions of Rule 139-B, the administrative complaints against attorneys are generally not dismissed outright but are instead referred for investigation, report and recommendation either to the IBP, or the Office of the Bar Confidant (OBC), or any office of the Court or even a judge of a lower court. Such referral ensures that the parties’ right to due process is respected as to matters that require further inquiry

and which cannot be resolved by the mere evaluation of the documents attached to the pleadings. Consequently, whenever the referral is made by the Court, the IBP, the OBC or other authorized office or individual must conduct the formal investigation of the administrative complaint, and this investigation is a mandatory requirement that cannot be dispensed with except for valid and compelling reasons because it serves the purpose of threshing out all the factual issues that no cursory evaluation of the pleadings can determine. However, the referral to the IBP is not compulsory when the administrative case can be decided on the basis of the pleadings filed with the Court, or when the referral to the IBP for the conduct of formal investigation would be redundant or unnecessary, such as when the protraction of the investigation equates to undue delay. Dismissal of the case may even be directed at the outset should the Court find the complaint to be clearly wanting in merit. Indeed, the Rules of Court should not be read as preventing the giving of speedy relief whenever such speedy relief is warranted. It is upon this that we dispense with the need to refer the complaint against the respondent to the IBP for the conduct of the formal investigation. The documents he submitted to substantiate his denial of professional wrongdoing are part of the records of the trial court, and, as such, are sufficient to establish the unworthiness of the complaint as well as his lawful entitlement to the demolition of the structures of the defendants. Specifically, the demolition was authorized by the order issued by the MTC. In the execution of the final and executory decision, the sheriffs dutifully discharged their functions. The presence of the respondent during the execution proceedings was by no means irregular or improper, for he was the plaintiff in the case. The complainant was then represented by Pante and some other members of the congregation, who did not manifest any resistance or objection to any irregularity in the conduct of the execution. After all, the elements of the PNP were also present to ensure the peaceful implementation of the writ of execution. Neither do we find anything wrong, least of all criminal, in the act of the respondent of taking away the materials of the demolished structures. The parties put an end to their dispute by the defendants, including the complainant and Pante, opting to withdraw their notice of appeal and undertaking to voluntarily vacate and to peacefully turn over the premises to the respondent in exchange for the latter’s financial assistance. DUTY TO THE CLIENT; CANONS 17 and 18 of CPR Angelito Ramiscal and Mercedes Orzame vs. Atty. Edgar Orro A.C. No. 10945, February 23, 2016 Doctrine: The fiduciary duty of every lawyer towards his client requires him to conscientiously act in advancing and safeguarding the latter's interest. His failure or neglect to do so constitutes a serious breach of his Lawyer's Oath and the canons of professional ethics, and renders him liable for gross misconduct that may warrant his suspension from the practice of law. Facts: Complainants Spouses Ramiscals engaged the legal services of respondent Atty. Edgar S. Orro to handle a case in which they were the defendants. Upon receiving the acceptance fee, the respondent handled the trial of the case until the RTC decided it in their favor. As expected, the plaintiffs appealed to the CA, and they ultimately filed their appellants’ brief. Upon receipt of the appellants’ brief, the respondent requested from the complainants an additional amount for the preparation and submission of their appellees’ brief. They obliged and paid him the amount requested. CA reversed the decision of the RTC. The respondent did not inform the Ramiscals of the adverse decision of the CA. They endeavored to communicate with the respondent but their efforts were initially in vain. When they finally reached him, he asked an additional P7,000 from them as his fee in filing a motion for reconsideration in their behalf, albeit telling them that such motion would already be belated. Even so, they paid to him the amount sought. To their dismay, they later discovered that he did not file the motion for reconsideration; hence, the decision attained finality, eventually resulting in the loss of their property. The Ramiscals brought this administrative complaint against the respondent. Issue: Whether or not the respondent competently and diligently discharge his duties as the lawyer of the Ramiscals

Ruling/Ratio: No. Every lawyer, upon becoming a member of the Philippine Bar, solemnly takes the Lawyer’s Oath, by which he vows, among others, that: “I will delay no man for money or malice, and will conduct myself as a lawyer according to the best of my knowledge and discretion, with all good fidelity as well to the courts as to my clients.” If he should violate the vow, he contravenes the CPR, particularly its Canon 17, and Rules 18.03 and 18.04 of Canon 18. It is beyond debate, therefore, that the relationship of the lawyer and the client becomes imbued with trust and confidence from the moment that the lawyer-client relationship commences, with the lawyer being bound to serve his clients with full competence, and to attend to their cause with utmost diligence, care and devotion. To accord with this highly fiduciary relationship, the client expects the lawyer to be always mindful of the former’s cause and to be diligent in handling the former’s legal affairs. As an essential part of their highly fiduciary relationship, the client is entitled to the periodic and full updates from the lawyer on the developments of the case. The lawyer who neglects to perform his obligations violates Rule 18.03 of Canon 18 of the CPR. But he obviously failed to discharge his burdens to the best of his knowledge and discretion and with all good fidelity to his clients. By voluntarily taking up their cause, he gave his unqualified commitment to advance and defend their interest therein. Even if he could not thereby guarantee to them the favorable outcome of the litigation, he reneged on his commitment nonetheless because he did not file the motion for reconsideration in their behalf despite receiving from them the P7,000 he had requested for that purpose. He further neglected to regularly update them on the status of the case, particularly on the adverse result, thereby leaving them in the dark on the proceedings that were gradually turning against their interest. Updating the clients could have prevented their substantial prejudice by enabling them to engage another competent lawyer to handle their case. As it happened, his neglect in that respect lost for them whatever legal remedies were then available. His various omissions manifested his utter lack of professionalism towards them. We further underscore that the respondent owed it to himself and to the entire Legal Profession of the Philippines to exhibit due respect towards the IBP as the national organization of all the members of the Legal Profession. CANONS 1 and 7; GROUNDS FOR DISBARMENT (SEC. 27, RULE 138) Jessie Campugan vs. Atty. Federico Tolentino Jr. A.C. No. 8261, March 11, 2015 Doctrine: A lawyer may be disciplined for misconduct committed either in his professional or private capacity. The test is whether his conduct shows him to be wanting in moral character, honesty, probity, and good demeanor, or whether his conduct renders him unworthy to continue as an officer of the Court. Facts: Atty. Victorio, Jr. is the counsel of the complainants in a civil action they brought to seek the annulment of land title. They impleaded as defendants Ramon and Josefina Ricafort, Juliet Vargas and the Register of Deeds (RD). They caused to be annotated on TCT their affidavit of adverse claim, as well as the notice of lis pendens. Atty. Tolentino, Jr. was the counsel of defendant Ramon and Josefina Ricafort. As the surviving children of the late Spouses Antonio and Nemesia Torres, they inherited upon the deaths of their parents a residential lot and they discovered that the title had been unlawfully cancelled and replaced by another title by the RD under the names of Ramon and Josefina Ricafort; and that, accordingly, they immediately caused the annotation of their affidavit of adverse claim on the TCT. It appears that the parties entered into an amicable settlement during the pendency of the Civil Case in order to end their dispute, whereby the complainants agreed to sell the property and the proceeds thereof would be equally divided between the parties, and the complaint and counterclaim would be withdrawn respectively by the complainants (as the plaintiffs) and the defendants. Pursuant to the terms of the amicable settlement, Atty. Victorio, Jr. filed a Motion to Withdraw Complaint, which the RTC granted upon noting the defendants’ lack of objection thereto and the defendants’ willingness to similarly withdraw their counterclaim. The complainants alleged that from the time of the issuance by the RTC of the order, they could no longer locate or contact Atty. Victorio, Jr. despite making several phone calls and visits to his office; that they found out upon verification at the RD that new annotations were made on the TCT.

Issue: Whether or not the respondent must be disbarred Ruling/Ratio: No. A lawyer may be disciplined for misconduct committed either in his professional or private capacity. The test is whether his conduct shows him to be wanting in moral character, honesty, probity, and good demeanor, or whether his conduct renders him unworthy to continue as an officer of the Court. Verily, Canon 7 of the CPR mandates all lawyers to uphold at all times the dignity and integrity of the Legal Profession. Lawyers are similarly required under Rule 1.01, Canon 1 of the same Code not to engage in any unlawful, dishonest and immoral or deceitful conduct. Failure to observe these tenets of the CPR exposes the lawyer to disciplinary sanctions as provided in Section 27, Rule 138 of the Rules of Court. The complainants’ allegations of the respondents’ acts and omissions are insufficient to establish any censurable conduct against them. The duty of the RD is ministerial in nature under Section 10 of Presidential Decree No. 1529 (Property Registration Decree). A purely ministerial act or duty is one that an officer or tribunal performs in a given state of facts, in a prescribed manner, in obedience to the mandate of a legal authority, without regard to or the exercise of his own judgment upon the propriety or impropriety of the act done. If the law imposes a duty upon a public officer and gives him the right to decide how or when the duty shall be performed, such duty is discretionary, not ministerial. The duty is ministerial only when its discharge requires neither the exercise of official discretion nor the exercise of judgment. The Court finds no abuse of authority or irregularity committed by Atty. Quilala, Atty. Cunanan, and Atty. Caluya, Jr. with respect to the cancellation of the notice of adverse claim and the notice of lis pendens annotated on TCT. Whether or not the RTC order or the letter-request had been falsified, fraudulent or invalid was not for them to determine inasmuch as their duty to examine documents presented for registration was limited only to what appears on the face of the documents. If, upon their evaluation of the letter-request and the RTC order, they found the same to be sufficient in law and to be in conformity with existing requirements, it became obligatory for them to perform their ministerial duty without unnecessary delay. PROHIBITION FOR JUDICIAL EMPLOYEES TO WORK AS INSURANCE AGENTS Re: Anonymous Letter-Complaint on the Alleged Involvement and for Engaging in the Business of Lending Money at Usurious Rates of Interest of Ms. Dolores Lopes A.M. No. 2010-21-SC, September 30, 2014 Doctrine: An anonymous complaint is always received with great caution, originating as it does from a source unwilling to identify himself or herself. But the mere anonymity of the source should not call for the outright dismissal of the complaint on the ground of its being baseless or unfounded provided its allegations can be reliably verified and properly substantiated by competent evidence. Facts: An undated letter-complaint addressed to the Supreme Court triggered this administrative matter. The letter-complaint, purportedly sent by a concerned employee who chose to remain anonymous, assailed the profitable money lending with usurious interest scheme engaged in by respondents Dolores Lopez, and Fernando Montalvo, both of the Checks Disbursement Division of the Court’s Fiscal Management and Budget Office (FMBO), alleging that the respondents had been involved in the money-lending activities targeting the low-salaried employees of the Court; that such money-lending had been going on with the help of the personnel of the Checks Disbursement Division of FMBO by enticing employees of the Court to pledge forthcoming benefits at a discounted rate. In her memorandum, Lopez neither denied nor admitted the allegations against her. She dared the OAS instead to allow her to confront the complainant head on and to openly address each issue. In his memorandum, Montalvo dismissed the letter-complaint as maliciously sent for the purpose of tarnishing his reputation and the reputation of his office. He denied being engaged in the lending business in the Court. Like Lopez, he insinuated that the OAS had not required any comments from other employees and officials of the Court against whom more serious accusations had been raised. Lopez and Montalvo appeared before the CID for the clarificatory hearing. Specifically, Lopez denied the allegation that she had lent money to around 300 court

employees, and that she had held their ATM cards in her custody as collateral; but admitted having lent money to only about 20 personnel of the janitorial agency and to some low-ranking employees of the Court. Lopez acknowledged that she was the only person in the Checks Disbursement Division of FMBO who had lent money, absolving Montalvo and the other members of the staff of that office by saying that they had nothing to do with her transactions. The OAS submitted its report, recommending dismissal of the letter-complaint against Montalvo for lack of merit; but endorsed Lopez’s suspension for 30 days for lending money with interest to a number of economically challenged employees and janitors; and directed her to immediately cease and desist from engaging in any form of personal business and other financial transactions, with a warning that a repetition of the same or similar act in the future will be dealt with more severely. Issue: Whether or not the Lopez should be held administratively liable based on the anonymous letter complaint. Ruling/Ratio: Yes. An anonymous complaint is always received with great caution, originating as it does from a source unwilling to identify himself or herself. But the mere anonymity of the source should not call for the outright dismissal of the complaint on the ground of its being baseless or unfounded provided its allegations can be reliably verified and properly substantiated by competent evidence. Here, therefore, the anonymous complaint has to be dealt with, and its veracity tested with utmost care, for it points the finger of accusation at two employees of the Court for engaging in money-lending activities at unconscionable rates of interest, with low-ranking employees of the Court as their targets. That such a complaint, albeit anonymous, has been made impacts on their reputations as individuals as well as on their integrity as personnel of the Court itself. We cannot ignore the complaint, hoping that it will be forgotten, but must inquire into it and decide it despite the anonymity of the complainant. Re: Montalvo The Court concurs with the findings of the OAS that the complaint against Montalvo had no factual basis. His involvement in money lending was not shown to be habitual, going on only as far as accommodating his friends during their personal emergencies without imposing any interests. It is notable that Montalvo firmly denied the allegations against him, and that Lopez corroborated his denial. Accordingly, the complaint against Montalvo should be dismissed. Re: Lopez As to Lopez, no witnesses appeared during the investigation to prove the allegations of the complaint. But the complaint should still be assessed on the basis of her several admissions in the course of the investigation. The Court agrees with the observations and findings of the OAS about Lopez having engaged in money-lending activities. Her various admissions entirely belied her insistence that her activities did not constitute money lending. The fact of her parting with her money in favor of another upon the condition that the same amount would be paid back was exactly what constituted a loan under the law, particularly Article 1933 of the Civil Code. Did Lopez’s money-lending activities render her administratively liable? Administrative Circular No. 5 (Re: Prohibition for All Officials and Employees of the Judiciary to Work as Insurance Agents), has prohibited all officials and employees of the Judiciary from engaging directly in any private business, vocation or profession, even outside their office hours. The prohibition has been at ensuring that full-time officers and employees of the courts render full-time service, for only thereby could any undue delays in the administration of justice and in the disposition of court cases be avoided. Although many “moonlighting” activities were themselves legal acts that would be permitted or tolerated had the actors not been employed in the public sector, moonlighting, albeit not usually treated as a serious misconduct, can amount to a malfeasance in office by the very nature of the position held. In the case of Lopez, her being the Chief of the Checks Disbursement Division of the FMBO, a major office of the Court itself, surely put the integrity of the Division and the entire FMBO under so much undeserved suspicion. We do not need to stress that she was expected to be circumspect about her acts and actuations, knowing that the impression of her having taken advantage of her position and her having abused the confidence reposed in her office and functions as such would thereby become unavoidable.

There is no doubt about her onerous lending activities greatly diminishing the reputation of her office and of the Court itself in the esteem of the public. No less that the Constitution itself impresses this expectation in Section 1 of its Article XI, to wit: Public office is a public trust. Public officers and employees must at all times, be accountable to the people, serve them with utmost responsibility, integrity, loyalty, and efficiency, act with patriotism and justice, and lead modest lives.” Lopez was quite aware that the foregoing declarative language of the Constitution on the nature of her public office and her responsibilities as a public officer was not mere rhetoric expressing idealistic sentiments, but a definite working standard and a statement of attainable goals that the actual deeds of the public officers and employees should match. She plainly disregarded the Constitution. The Court has invariably imposed commensurate sanctions upon court employees found and declared to be violating Administrative Circular No. 5. The sanctions have depended on the gravity of the violations committed and on the careful consideration of the personal records of the employees concerned, like their prior administrative cases. Based on the foregoing, Lopez committed simple misconduct, a less grave offense that is punishable under Rule IV, Section 52 of the Revised Uniform Rules on Administrative Cases in the Civil Service by suspension from one month and one day to six months for the first offense, and dismissal for the second offense. Yet, although a first-time offender, she could not be punished with the minimum of the imposable penalty because she clearly abused her being a high-ranking officer in the FMBO in conducting her private transactions within court premises during office hours, thereby putting the image of the Judiciary in a bad light. Hence, her appropriate penalty is suspension from office for three months without pay. In ordering their investigation upon the anonymous complaint, the Court did not discriminate and unfairly act against the respondents In ordering the administrative investigation of the respondents, the Court was moved only by the most laudable of purposes. To start with, the investigation would never be unfair because they would thereby be accorded the full opportunity to be heard in order to clear themselves. And, secondly, they were not being singled out because the Court has always acted upon every appropriate complaint or grievance – anonymous or not – brought against officials and employees of the Judiciary without regard to their ranks or responsibilities, including any of its sitting Members, the incumbent Justices of the third-level courts, and other active judges of the first and second levels of the courts. Only last week did the Court remove a very senior Justice of the Sandiganbayan for cause, and in his case there was not even any formal complaint brought against him. To accuse the Court of unfairness and discrimination was, therefore, censurable. Nonetheless, the Court accords to Montalvo and Lopez the reasonable opportunity to show cause why they should not be disciplined or otherwise sanctioned for their censurable statements. LAWYER’S OATH; RULE 1.03, CANON 1, CPR; RULE 11.04, CANON 11, CPR Presiding Judge Jose Madrid vs. Atty. Juan Dealca A.C. No. 7474, September 09, 2014 Doctrine: Although the Court always admires members of the Bar who are imbued with a high sense of vigilance to weed out from the Judiciary the undesirable judges and inefficient or undeserving court personnel, any acts taken in that direction should be unsullied by any taint of insincerity or self-interest. Facts: Atty. Juan S. Dealca entered his appearance in a Criminal Case presided by complainant Judge Jose L. Madrid. Atty. Dealca moved that the Criminal Case be re-raffled to another Branch of the RTC “considering the adverse incidents between the incumbent Presiding Judge and the undersigned,” where “he does not appear before the incumbent Presiding Judge, and the latter does not also hear cases handled by the undersigned.” Judge Madrid denied Atty. Dealca’s motion to re-raffle. Consequently, Judge Madrid filed a letter complaint in the Office of the Bar Confidant citing Atty. Dealca’s unethical practice of entering his appearance and then moving for the inhibition of the presiding judge on the pretext of previous adverse incidents between them. The Court referred the matter to the IBP. The Court dismissed for its lack of merit the administrative complaint against Judge Madrid, but referred to the IBP for investigation, report and recommendation the propensity of Atty. Dealca to file administrative or criminal complaints against judges and court personnel whenever decisions, orders or processes were

issued adversely to him and his clients. The IBP reported that Atty. Dealca filed by himself 5 cases as counsel for the complainants against court officers, judges and personnel. All these cases are precipitated by the adverse ruling rendered by the court against the clients of the respondent that instead of resorting to the remedies available under the Rules of Procedure, respondent assisted his clients in filing administrative and criminal case against the judges and personnel of the court. All these documentary evidence are helpful in determining the “PROPENSITY” of the respondent as a member of the bar in resorting to harassment cases instead of going through the procedures provided for by the Rules of Court in the event of adverse ruling, order or decision of the court. The IBP Commissioner found Atty. Dealca guilty of violating the Lawyer’s Oath and the Code of Professional Responsibility (CPR) by filing frivolous administrative and criminal complaints; and recommended that he be suspended from the practice of law for one year. The IBP Board of Governors modified the recommendation and dismissed the administrative complaint for its lack of merit. Issue/s: 1. Whether or not Atty. Dealca filed frivolous administrative and criminal complaints against judges and court personnel in violation of the Lawyer’s Oath and the CPR 2. Whether or not Atty. Dealca is guilty of unethical practice in seeking the inhibition of Judge Madrid Ruling/Ratio: 1. Yes. Atty. Dealca must guard against his own impulse of initiating unfounded suits. Although the Court always admires members of the Bar who are imbued with a high sense of vigilance to weed out from the Judiciary the undesirable judges and inefficient or undeserving court personnel, any acts taken in that direction should be unsullied by any taint of insincerity or self-interest. It is for that reason that Atty. Dealca’s complaint against Judge Madrid has failed our judicious scrutiny, for the Court cannot find any trace of idealism or altruism in the motivations for initiating it. Instead, Atty. Dealca exhibited his proclivity for vindictiveness and penchant for harassment, considering that, as IBP Commissioner Hababag pointed out, his bringing of charges against judges, court personnel and even his colleagues in the Law Profession had all stemmed from decisions or rulings being adverse to his clients or his side. The Lawyer’s Oath is a source of obligations and duties for every lawyer, and any violation thereof by an attorney constitutes a ground for disbarment, suspension, or other disciplinary action. These are not mere facile words, drift and hollow, but a sacred trust that must be upheld and keep inviolable. As a lawyer, therefore, Atty. Dealca was aware of his duty under his Lawyer’s Oath not to initiate groundless, false or unlawful suits. The duty has also been expressly embodied in Rule 1.03, Canon 1 of the CPR. Moreover, Atty. Dealca must be mindful of his mission to assist the courts in the proper administration of justice. He disregarded his mission because his filing of the unfounded complaints, including this one against Judge Madrid, increased the workload of the Judiciary. Although no person should be penalized for the exercise of the right to litigate, the right must nonetheless be exercised in good faith. Atty. Dealca’s bringing of the numerous administrative and criminal complaints against judges, court personnel and his fellow lawyers did not evince any good faith on his part, considering that he made allegations against them therein that he could not substantially prove, and are rightfully deemed frivolous and unworthy of the Court’s precious time and serious consideration. Atty. Dealca was apparently referring to the minute resolutions the Court could have promulgated in frequently dismissing his unmeritorious petitions. His arrogant posturing would not advance his cause now. He thereby demonstrated his plain ignorance of the rules of procedure applicable to the Court. The minute resolutions have been issued for the prompt dispatch of the actions by the Court. Whenever the Court then dismisses a petition for review for its lack of merit through a minute resolution, it is understood that the challenged decision or order, together with all its findings of fact and law, is deemed sustained or upheld, and the minute resolution then constitutes the actual adjudication on the merits of the case. The dismissal of the petition, or its denial of due course indicates the Court’s agreement with and its adoption of the findings and conclusions of the court a quo. The requirement for stating the facts and the law does not apply to the minute resolutions that the Court issues in disposing of a case. 2. Yes. Atty. Dealca violated Canon 11 and Rule 11.04 of the CPR. Lawyers are licensed officers of the courts empowered to appear, prosecute and defend the legal causes for their clients. As a consequence, peculiar duties, responsibilities and liabilities are devolved upon them by law. Verily,

their membership in the Bar imposes certain obligations upon them. Atty. Dealca’s averment that Judge Madrid did not hear cases being handled by him directly insinuated that judges could choose the cases they heard, and could refuse to hear the cases in which hostility existed between the judges and the litigants or their counsel. Such averment, if true at all, should have been assiduously substantiated by him because it put in bad light not only Judge Madrid but all judges in general. Yet, he did not even include any particulars that could have validated the averment. Nor did he attach any document to support it. It was incumbent upon Atty. Dealca to establish by clear and convincing evidence the ground of bias and prejudice in order to disqualify Judge Madrid from participating in a particular trial in which Atty. Dealca was participating as a counsel. The latter’s bare allegations of Judge Madrid’s partiality or hostility did not suffice. As such, Atty. Dealca clearly contravened his duties as a lawyer as expressly stated in Canon 11 and Rule 11.04. On a final note, it cannot escape our attention that this is not the first administrative complaint to be ever brought against Atty. Dealca. In Montano v. IBP, we reprimanded him for violating Canon 22 and Rule 20.4, Canon 20 of the CPR, and warned him that a repetition of the same offense would be dealt with more severely. Accordingly, based on the penalties the Court imposed on erring lawyers found violating Canon 1, Rule 1.03, and Canon 11, Rule 11.04 of the Code, we deem appropriate to suspend Atty. Dealca from the practice of law for a period one year. LAWYER’S OATH; DUTY TO THE CLIENT Henry Samonte vs. Atty. Gines Abellana A.C. No. 3452, June 23, 2014 Doctrine: A lawyer who willfully resorts to any falsehood in order to mislead the courts or his clients on the status of their causes exhibits his unworthiness to remain a member of the Law Profession. This is because he is always expected to be honest and forthright in his dealings with them. He thereby merits the condign sanction of suspension from the practice of law, if not disbarment. Facts: Complainant Samonte brought this administrative complaint against respondent Atty. AbelJana who had represented him as the plaintiff in a Civil Case. In the administrative complaint, Samonte enumerated the serious acts of professional misconduct by Atty. Abellana, to wit: 1. Falsification of documents, when Atty. Abellana made it appear that he had filed the Civil Case on June 10, 1988, conformably with their agreement, although the complaint was actually filed on June 14, 1988; 2. Dereliction of duty, when Atty. Abellana failed to: (a) file the reply vis-à-vis the answer with counterclaim, with his omission having delayed the pre-trial of the case; (b) inform the trial court beforehand that Samonte could not be available on a scheduled hearing, thereby incurring for the plaintiff’s side an unexplained absence detrimental to Samonte as the plaintiff; and (c) submit an exhibit required by the trial judge, only to eventually submit it three months later; 3. Gross negligence and tardiness in attending the scheduled hearings; and 4. Dishonesty for not issuing official receipts for every cash payments made by Samonte for his court appearances and his acceptance of the case. Atty. Abellana denied the charge of falsification of documents, clarifying that the actual filing of the complaint could be made only on June 14, 1988 instead of June 10, 1988 because Samonte had not given enough money to cover the filing fees and other charges. The IBP Commission on Bar Discipline found Atty. Abellana negligent in handling certain aspects of his client’s case and recommended the disbarment of Atty. Abellana, observing that apart from his negligent handling of portions of the civil case, said respondent has shown a facility for utilizing false and deceitful practices as a means to cover-up his delay and lack of diligence in pursuing the case of his client. The IBP Board of Governors, albeit adopting the findings of the IBP Investigating Commissioner, suspended Atty. Abellana from the practice of law for one year. Issue: Whether or not the suspension of Atty. Abellana should be upheld

Ruling/Ratio: Yes. A lawyer who willfully resorts to any falsehood in order to mislead the courts or his clients on the status of their causes exhibits his unworthiness to remain a member of the Law Profession. This is because he is always expected to be honest and forthright in his dealings with them. He thereby merits the condign sanction of suspension from the practice of law, if not disbarment. In his dealings with his client and with the courts, every lawyer is expected to be honest, imbued with integrity, and trustworthy. These expectations, though high and demanding, are the professional and ethical burdens of every member of the Philippine Bar, for they have been given full expression in the Lawyer’s Oath that every lawyer of this country has taken upon admission as a bona fide member of the Law Profession. By the Lawyer’s Oath is every lawyer enjoined not only to obey the laws of the land but also to refrain from doing any falsehood in or out of court or from consenting to the doing of any in court, and to conduct himself according to the best of his knowledge and discretion with all good fidelity as well to the courts as to his clients. It is by no means a coincidence; therefore, that honesty, integrity and trustworthiness are emphatically reiterated by the CPR. Atty. Abellana abjectly failed the expectations of honesty, integrity and trustworthiness in his dealings with Samonte as the client, and with the RTC as the trial court. He resorted to outright falsification by superimposing “0” on “4” in order to mislead Samonte into believing that he had already filed the complaint in court on June 10, 1988 as promised, instead of on June 14, 1988, the date when he had actually done so. Atty. He continued misleading Samonte in explaining his mishandling of the latter’s civil case. Worse, he also foisted his dishonesty on the Court no less. The finding on Atty. Abellana’s neglect in the handling of Samonte’s case was entirely warranted. He admitted being tardy in attending the hearings of the civil case. He filed the formal offer of evidence in behalf of his client way beyond the period to do so, a fact that he could not deny because the RTC Judge had himself expressly noted the belated filing in the order issued in the case. In the motion for reconsideration that he filed in the IBP Board of Governors, Atty. Abellana challenged the sufficiency of the proof presented against him by Samonte. In disciplinary proceedings against lawyers, clearly preponderant evidence is required to overcome the presumption of innocence in favor of the respondent lawyers. Preponderant evidence means that the evidence adduced by one side is, as a whole, superior to or has greater weight than that of the other. The complainant’s evidence preponderantly established the administrative sins of Atty. Abellana. The falsehoods committed by Atty. Abellana, being aimed at misleading his client and the Court to bolster his unworthy denial of his neglect in the handling of the client's case, were unmitigated. Still, the Court must not close its eyes to the fact that Atty. Abellana actually finished presenting his client's case; and that the latter initiated the termination of Atty. Abellana's engagement as his counsel only after their relationship had been tainted with mistrust. Thus, we determine the proper sanction. For Atty. Abellana, therefore, suspension from the practice of law for six months with warning of a more severe sanction upon a repetition suffices. LAWYER’S OATH; RULE 1.01, CANON 1; RULE 7.03, CANON 7, CPR Benjamin Ong vs. Atty. William Delos Santos A.C. No. 10179 (Formerly CBD 11–2985), March 04, 2014 Doctrine: Every lawyer is an officer of the Court. He has the duty and responsibility to maintain his good moral character. In this regard, good moral character is not only a condition precedent relating to his admission into the practice of law, but is a continuing imposition in order for him to maintain his membership in the Philippine Bar. Any gross misconduct that puts his moral character in serious doubt renders him unfit to continue in the practice of law. Facts: According to complainant Ong, Atty. Delos Santos asked him to encash his postdated check inasmuch as he was in dire need of cash. To reassure Ong that the check would be funded upon maturity, Atty. Delos Santos bragged about his lucrative practice and his good paying clients. Convinced, Ong handed to Atty. Delos Santos the amount of P100,000 in exchange for the latter’s postdated check. However, the check was dishonored upon presentment for the reason that the account was closed. Ong demanded immediate payment to Atty. Delos Santos, but the latter just ignored him. When efforts to collect remained futile, Ong

brought a criminal complaint for estafa and for violation of BP 22. Ong also brought this disbarment complaint against Atty. Delos Santos in the IBP. The IBP Bar Commissioner stated that Ong had sufficiently established the existence of the dishonored check. He recommended that Atty. Delos Santos be held liable for violating Canon 1, Rule 1.01 and Canon 7, Rule 7.03 of the CPR. The IBP Board of Governors adopted and approved the findings of IBP Commissioner. Issue: Whether or not Atty. William F. Delos Santos shall be held administratively liable Ruling/Ratio: Yes. We agree with the findings of the IBP but modify the recommended penalty. Every lawyer is an officer of the Court. He has the duty and responsibility to maintain his good moral character. In this regard, good moral character is not only a condition precedent relating to his admission into the practice of law, but is a continuing imposition in order for him to maintain his membership in the Philippine Bar. Any gross misconduct that puts his moral character in serious doubt renders him unfit to continue in the practice of law. BP Blg. 22 has been enacted in order to safeguard the interest of the banking system and the legitimate public checking account users. The effects of the issuance of a worthless check transcends the private interests of the parties directly involved in the transaction and touches the interests of the community at large. The mischief it creates is not only a wrong to the payee or holder, but also an injury to the public. Being a lawyer, Atty. Delos Santos was well aware of the objectives and coverage of BP Blg. 22. If he did not, he was nonetheless presumed to know them, for the law was penal in character and application. His issuance of the unfunded check involved herein knowingly violated BP Blg. 22, and exhibited his indifference towards the pernicious effect of his illegal act to public interest and public order. He thereby swept aside his Lawyer’s Oath that enjoined him to support the Constitution and obey the laws. He also took for granted the express commands of the CPR, specifically Canon 1, Rule 1.01 and Canon 7, Rule 7.03. Moreover, in issuing the dishonored check, Atty. Delos Santos put into serious question not only his personal integrity but also the integrity of the entire Integrated Bar. It cannot be denied that Ong acceded to Atty. Delos Santos’ request for encashment of the check because of his complete reliance on the nobility of the Legal Profession. Accordingly, Atty. Delos Santos was guilty of serious misconduct, warranting appropriate administrative sanction. Noting that the criminal complaint charging him with the violation of BP Blg. 22 was already dismissed, and that he already repaid to Ong the full amount of P100,000, both of which are treated as mitigating circumstances in his favor, we find the recommendation of the IBP Board of Governors to suspend him from the practice of law for a period of three years harsh. Thus, we reduce the penalty to suspension from the practice of law to six months. DISBARMENT OF LAWYERS Heinz Heck vs. City Prosecutor Casiano Gamotin Jr, A.C. No. 5329, March 18, 2014

Doctrine: A lawyer like the respondent is not to be sanctioned for every perceived misconduct or wrong actuation. He is still to be presumed innocent of wrongdoing until the proof arrayed against him establishes otherwise. It is the burden of the complainant to properly show that the assailed conduct or actuation constituted a breach of the norms of professional conduct and legal ethics. Otherwise, the lawyer merits exoneration. Facts: Heck filed a criminal case for unjust vexation against Cabrera but the case was dismissed. Cabrera countered with two criminal cases against Heck — one charging the latter with illegal possession of firearms and the other with unlawful incrimination of an innocent person. Atty. Adaza represented Cabrera in both cases. The OCP initially dismissed the first case for insufficiency of evidence, but Atty. Adaza moved for the reconsideration of the dismissal which was granted by the respondent. Heck challenged the order of the respondent. Heck claimed that the respondent scheduled a meeting at his office to be attended by Heck, his lawyer, his wife and Atty. Adaza. However, Atty. Adaza did not attend the meeting. Heck alleged, however, that Atty. Adaza and the respondent held their own separate “private meeting,”

for which reason Heck questioned the propriety of the private meeting and the possibility of connivance between the respondent and Atty. Adaza. Heck went to the respondent’s office to pick up documents supposedly promised to him. But he was denied the documents. He further alleged that Prosecutor Gamotin, Jr. furiously KICKED the chair who was holding the door to his office open, sending the chair flying onto the other chairs at his conference table. Heck then asked why the respondent was still entertaining Atty. Adaza despite his having been already suspended from the practice of law by the Supreme Court. It appears that Heck had filed administrative complaints against the respondent in the DOJ as well as in the Office of the Ombudsman. The records were first referred to the Office of the Court Administrator, then to the Office of the Bar Confidant (OBC) for evaluation of the merits of the disbarment case against the respondent. The OBC observed that although there was no clear, convincing and satisfactory evidence of misconduct as to warrant the penalty of disbarment, the respondent’s conduct should be sanctioned; that his act of privately entertaining Atty. Adaza and his brother, as well as allowing his office to be used for a meeting even in his absence raised doubt on his integrity; that the respondent’s reaction to Heck’s tirade against the country’s justice system, particularly the respondent’s retort that Heck should go back to his country if he did not believe in the Philippine authorities, constituted decorum that was so unbecoming of a lawyer. Issue: Whether or not City Prosecutor Gamotin should be disbarred Ruling/Ratio: No. We consider that the evidence adduced by the complainant insufficient to warrant the disbarment of the respondent. A lawyer like the respondent is not to be sanctioned for every perceived misconduct or wrong actuation. He is still to be presumed innocent of wrongdoing until the proof arrayed against him establishes otherwise. It is the burden of the complainant to properly show that the assailed conduct or actuation constituted a breach of the norms of professional conduct and legal ethics. Otherwise, the lawyer merits exoneration. To begin with, the holding of the meeting between Atty. Babarin, Heck’s counsel, and Atty. Adaza in the respondent’s office was not suspicious or irregular, contrary to the insinuation of Heck. We are not unmindful of the practice of some legal practitioners to arrange to meet with their opposing counsels and their clients in the premises of the offices of the public prosecutors or in the courthouses primarily because such premises are either a convenient or a neutral ground for both sides. Secondly, we cannot sanction the respondent for having angrily reacted to Heck’s unexpected tirade in his presence. The respondent was not then reacting to an attack on his person, but to Heck’s disrespectful remark against Philippine authorities in general. Lawyers may be expected to maintain their composure and decorum at all times, but they are still human, and their emotions are like those of other normal people placed in unexpected situations that can crack their veneer of self–control. The Court will not permit the respondent’s good record to be tarnished by his having promptly reacted to Heck’s remark. Lastly, Heck complains that the respondent still entertained Atty. Adaza despite the latter having been already suspended from the practice of law. The respondent explains, however, that he had no personal knowledge of Atty. Adaza’s suspension and that such information was not properly disseminated to the proper offices. We are inclined to believe the respondent’s explanation. We believe that the respondent was not yet aware of the suspension at that time. It was possible that at the occasion when Atty. Adaza appeared before the respondent, his suspension had not yet attained finality, or that the order of suspension had not yet been known to the respondent. Accordingly, it will be unjustified to hold the respondent liable for allowing Atty. Adaza to practice law and to represent his client in the OCP.