rule 2 case digest

8/11/2019 Rule 2 Case Digest

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Outline: RULE 2 - Cause of Action CIVIL PROCEDU

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CIVIL PROCEDURE

Lesson for August 2, 2014, Saturday

Judge Mike Asuncion

- Felipe Sr. v. Hon. Leuterio, G.R. No. L-4606, May 30, 1952

Cause of Action - the act or omission by which a party violates a right of another - Sec. 2, Rule 2

- Du v. Jayoma, G.R. No. 175042, April 23, 2012

Elements:

- Ma-ao Sugar Central Co. v. Barrios, G.R. No. L-1539, December 3, 1947

Right of Action vs. Cause of Action

- Marquez v. Varela, G.R. No. L-4845, December 24, 1952

Failure to state a cause of action

- Remitere v. Montinola Vda. De Yulo,. G.R. No. L-19751, February 28, 1966

Test of the sufficiency of a cause of action

- Misamis Occidental II Cooperative, Inc. v. David, G.R. No. 129928, August 25, 2005

Splitting a single cause of action

- Quadra v. CA, G.R. No. 147593, July 31, 2006

- Bachrach Motor v. Icarangal , G.R. No. L-45350, May 29, 1939

- City of Bacolod v. San Miguel Brewery , G.R. No. L-25134, October 30, 1969

Joinder and mis-joinder of causes of action

- Ada v. Baylon, G.R. No. 182435, August 13, 2012

- Sps. Perez v. Hermano, G.R. No. 147417, July 8, 2005



Case Digest: RULE 2 – Cause of Action CIVIL PROCEDU

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FELIPE, SR. vs LEUTERIO

G.R. No. L-4606, 30 May 1952

Facts:

A benefit inter-collegiate oratorical contest was held in

Naga City. The contestants were eight, among them Nestor Nosce,

Emma Imperial, and Luis General, Jr.

There were five judges of the competition, the petitioner

Ramon B. Felipe, Sr. being the Chairman.After the orators had delivered their respective pieces, and

after the judges had expressed their votes, the Chairman publicly

announced their decision awarding first price to Nestor Nosce,

second price to Emma Imperial, third price to Menandro Benavides

and fourth place to Luis General, Jr.

Imperial addressed a letter to the Board of Judges

protesting the verdict and alleging that one of the Judges had

committed a mathematical mistake, resulting in her second place

only instead of the first.

Upon refusal of the Board to amend their award, she filed

a complaint in the court of first instance.

At the contest the five judges were each furnished a blankform wherein he gave the participants grades according to his

estimate of their abilities, giving number 1 to the best, number 2 to

the second best etc., down to number 8. Then the grades were

added, and the contestant receiving the lowest number got first

prize, the next second prize, etc.

The sums for the first four winners were: Nosce 10;

Imperial 10; Benevides 17, General 17.

It appearing that Nosce and Imperial had tied for the first

place, the Chairman, apparently with the consent of the board,

broke the tie awarding first honors to Nosce and second honors to

Imperial.

It was discovered later that the form filed by DelfinRodriguez, one of the Judges, gave Imperial a total score of 94 (4

th

place) and General a total score of 95 (3rd

place).

Imperial asserts that her total should be 95 instead of 94

and therefore should rank 3rd place in Rodriguez' vote. And if she

got 3 from Rodriguez, her total vote should have been 9 instead of

ten, with the result that she copped first place in the speaking joust.

Rodriguez testified that he made a mistake in adding up

Imperial's ratings; that she should have been given a total of 95, or

placed no. 3, the same as General; that he was not disposed to

break the tie between her and General and insisted that he wanted

to give rank 3 to Imperial and rank 3 also to General.

The situation then is this: Days after a contest has been

conducted and the winners announced, one of the judges confesses

he made a mistake, that the ratings he gave the second place winner

should have been such as would entitle her to first place. The other

judges refuse to alter their verdict.

Issue:

May the matter be brought to the court to obtain a new

award, reversing the decision of the board of judges? No.

Held:

For more than thirty years oratorical tilts have been

periodically by schools and colleges in these islands. Inter-colleg

oratorical competitions are of more recent origin. Members of

court have taken part in them either as contestants in their sc

days, or as members of the board of judges afterwards. They k

some (few) verdicts did not reflect the audience's preference

that errors have sometimes been ascribed to the award of

judges. Yet no party ever presumed to invoke judicial intervenfor it is unwritten law in such contests that the board's decisio

final and unappealable.

Incidentally, these school activities have been impo

from the United States. We found in American jurisprudence

litigation questioning the determination of the board of judges.

SC observes that in assuming jurisdiction over the ma

the respondent judge reasoned out that where there is a w

there is a remedy and that courts of first instance are court

general jurisdiction.

The flaw in his reasoning lies in the assumption

Imperial suffered some wrong at the hands of the board of judge

at all, there was error on the part of one judge, at most. Errorwrong do not mean the same thing. "Wrong" as used in

aforesaid legal principle is the deprivation or violation of a right

stated before, a contestant has no right to the prize unless and

he or she is declared winner by the board of referees or judges.

Granting that Imperial suffered some loss or injury, y

law there are instances of "damnum absque injuria". This is on

them. If fraud or malice had been proven, it would be a diffe

proposition. But then her action should be directed against

individual judge or judges who fraudulently or maliciously inj

her. Not against the other judges.

The judiciary has no power to reverse the award of

board of judges of an oratorical contest. For that matter it wouldinterfere in literary contests, beauty contests and sim

competitions.

Cause of Action - the act or omission by which a party violates a r

of another - Sec. 2, Rule 2

DU vs. JAYOMA

G.R. No. 175042, 23 April 2012

Facts:

The Sangguniang Bayan of the Municipality of Ma

Bohol, enacted Municipal Ordinance No. 1, series of 1988, requ

the conduct of a public bidding for the operation of a cockpit in

said municipality every four years.

For the period January 1, 1989 to December 31, 1992,

winning bidder was Engr. Edgardo Carabuena. Due to his failur

comply with the legal requirements for operating a cockpit,

Sangguniang Bayan adopted Resolution authorizing petitioner Da

Du to continue his cockpit operation until the winning bid

complies with the legal requirements.




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Upon discovering that petitioner has been operating his

cockpit in violation of Municipal Ordinance, the Sangguniang Bayan

passed Municipal Resolution suspending petitioner’s cockpit

operation.

Pursuant to Municipal Resolution, respondent Venancio R.

Jayoma, then Mayor of Mabini, in a letter, ordered petitioner to

desist from holding any cockfighting activity.

Petitioner filed with the Regional Trial Court (RTC) of

Bohol, a Petition for Prohibition (Special Civil Action) againstrespondent mayor and nine members of the Sangguniang Bayan of

Mabini. Petitioner prayed that a preliminary injunction and/or a

temporary restraining order be issued to prevent respondents from

suspending his cockpit operation. Petitioner claimed that he has a

business permit to operate until December 31, 1997; and that the

Municipal Resolution was unlawfully issued as it deprived him of due

process.

Respondents interposed that under the Local Government

Code (LGC) of 1991, the power to authorize and license the

establishment, operation and maintenance of a cockpit is lodged in

the Sangguniang Bayan; that respondent mayor, in ordering the

suspension of petitioner’s cockpit operation, was merely exercisinghis executive power to regulate the establishment of cockpits in the

municipality, pursuant to the ordinances and resolutions enacted by

the Sangguniang Bayan; and that Municipal Resolution does not

need to be approved by the Sangguniang Panlalawigan because it is

not an ordinance but an expression of sentiments of the

Sangguniang Bayan of Mabini.

A Temporary Restraining Order was issued by the RTC

enjoining respondents from suspending the cockpit operation of

petitioner until further orders from the court.

The Petition for Prohibition was later amended to include

damages, which the RTC admitted in an Order.

The CA reversed the Decision of the RTC. According to theCA, petitioner did not acquire a vested right to operate a cockpit in

the municipality as he was only granted a temporary privilege by the

Sangguniang Bayan. CA denied petitioner’s reconsideration.

Issue:

Whether the CA erred in finding that petitioner is not

entitled to damages. No. There was no cause of action.

Held:

The petition lacks merit. A cause of action is defined as

"the act or omission by which a party violates a right of another."

Corollarily, the essential elements of a cause of action are:

(1) a right in favor of the plaintiff; (2) an obligation on the part of the

defendant to respect such right; and (3) an act or omission on the

part of the defendant in violation of the plaintiff’s right with a

resulting injury or damage to the plaintiff for which the latter may

file an action for the recovery of damages or other appropriate

relief. Petitioner has no legal right to operate a cockpit.

In this case, we find that petitioner has no cause of action

against the respondents as he has no legal right to operate a cockpit

in the municipality. Under Resolution, the Sangguniang Bayan

allowed him to continue to operate his cockpit only because the

winning bidder for the period January 1, 1989 to December 31, 1992

failed to comply with the legal requirements for operating a coc

Clearly, under the said resolution, petitioner’s authority to ope

the cockpit would end on December 31, 1992 or upon complianc

the winning bidder with the legal requirements for operatin

cockpit, whichever comes first. As we see it, the only reason he

able to continue operating until July 1997 was because

Sangguniang Bayan of Mabini failed to monitor the status of

cockpit in their municipality.

And even if he was able to get a business permit frespondent mayor for the period January 1, 1997 to Decembe

1997, this did not give him a license to operate a cockpit. U

Section 447(a)(3)(v) of the LGC, it is the Sangguniang Bayan whi

empowered to "authorize and license the establishment, opera

and maintenance of cockpits, and regulate cockfighting

commercial breeding of gamecocks." Considering that no p

bidding was conducted for the operation of a cockpit from Jan

1, 1993 to December 31, 1997, petitioner cannot claim that he

duly authorized by the Sangguniang Bayan to operate his cockp

the municipality for the period January 1, 1997 to December

1997. Respondent members of the Sangguniang Bayan, theref

had every reason to suspend the operation of petitioner’s cockpenacting Municipal Resolution. As the chief executive of

municipal government, respondent mayor was duty-bound

enforce the suspension of the operation of petitioner’s co

pursuant to the said Resolution. License to operate a cockpit

mere privilege.

In addition, it is well enshrined in our jurisprudence th

license authorizing the operation and exploitation of a cockpit is

property of which the holder may not be deprived without

process of law, but a mere privilege that may be revoked w

public interests so require." Having said that, petitioner’s allega

that he was deprived of due process has no leg to stand on.

Cause of Action - the act or omission by which a party violates a r

of another - Sec. 2, Rule 2

Elements:

MA-AO SUGAR CENTRAL CO. vs. BARRIOS

G.R. No. L-1539, 03 December 1947

Facts:

This is a petition for certiorari to set aside the order o

respondent judge denying the motion to dismiss the complain

the other respondents which seek to recover amounts of money

then from the petitioner before the outbreak of the war, on

ground that the respondent judge acted without or in excess o

court's jurisdiction in rendering said order; and for prohibitio

forbid the respondent judge from taking cognizance of the cas

the ground that the respondent judge had no jurisdiction to try

decide it.

The ground for the motion to dismiss filed by

petitioner is that the complaint of the respondents does not s




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facts sufficient to constitute a cause of action, because the plaintiffs

have no right to demand the payment of the defendants' alleged

debts until after the termination or legal cessation of the

moratorium provided No. 32, the pertinent part of which reads as

follows:

III. DEBT MORATORIUM

1. Enforcement of payment of all debts and other

monetary obligations payable within the Philippines,except debts and other monetary obligations, entered into

in any area after declaration by Presidential Proclamation,

that such area has been freed from enemy occupation and

control, is temporarily suspended pending action by the

Commonwealth Government.

Issue:

Whether or not the complaint of the plaintiffs-

respondents states no cause of action and the petition for certiorari

and prohibition filed in the present case do not entitle the petitioner

to said reliefs. Yes!

Held:

It is plain and Supreme Court (SC) is of the opinion that the

complaint filed by the plaintiff respondent in the court below does

not state facts sufficient to constitute a cause of action. A cause of

action is an act or omission of one party in violation of the legal right

or rights of the other; and its essential elements are legal right of the

plaintiff, correlative obligation of the defendant, and act or omission

of the defendant in violation of said legal right. In the present case

the complaint alleges the legal right of the plaintiffs to be paid the

amount due them from the defendant, as well as the correlative

obligation of the defendant to pay said debts to the plaintiffs whenit becomes due and payable; but not the omission on the part of the

defendant to pay in violation of the legal rights of the plaintiffs to be

paid, because according to the above quoted provision of Executive

Order No. 32, said debts are not yet payable or their payment can

not be enforced until the legal cessation of the moratorium, which is

still in force. As the defendant herein petitioner is not yet in default,

plaintiffs have no cause of action against him.

While the debt moratorium is in force the defendant-

petitioner has no obligation yet to pay the plaintiffs, and the latter

can not file a suit against him in the courts of justice requiring him to

recognize his debts to the plaintiffs and to pay them (after the

moratorium) not only the amount of the indebtedness, but the legal

interest thereon from the filling of the complaint, the attorney's fees

of ten per centum of the amounts due, and the costs of the suits.

There is no such action to compel a defendant to acknowledge or

recognize his debt which is not yet payable, distinct and different

from the action for recovery or payment of a debt already due and

payable, against the debtor who refuses to pay it. To allow the

plaintiffs' action and grant the relief demanded in the complaint,

would be to compel the defendant to pay legal interest of the

amount claimed from filing of the said complaint, as well as the

attorney's fees of 10 per cent of the sum due thereon as stipulated,

and the costs of the suit, as if the defendants' obligations to the

plaintiffs were already payable and he had failed or refused to

them. Why should the defendant be required to bear the expe

incidental to a suit before he has violated the plaintiffs' right?

could plaintiffs assume that the defendant will not pay his d

when they become payable, and for that reason they have filed

action against defendant? Why should not the contrary

presumed, that is, that the debtor will pay his obligation at

proper time, in order to prevent a suit, preserve its credit, and a

the expenses incident to a suit, and the payment of legal interesthe amount due and attorney's fees?

After stating SC’s opinion that the complaint of the plain

respondents states no cause of action, SC has to hold that the f

stated in the petition for certiorari and prohibition filed in

present case do not entitle the petitioner to said reliefs. It requ

no argument to show that the respondent judge had jurisdiction

did not exceed it or act with grave abuse of discretion in denying

petitioner's motion to dismiss, and therefore we have to dismiss

present petition. This Court, in special civil actions of certiorari

prohibition, can only determine the question whether or not

court acted without or in excess of its jurisdiction or with gabuse of its discretion in doing the act complained of. SC can

correct errors committed by the lower courts in their judgme

decrees or orders rendered in the exercise of their jurisdiction.

Right of Action vs. Cause of Action

MARQUEZ vs. VARELA

G.R. No. L-4845, December 24, 1952

Facts:

This is an appeal against an order of the Court of

Instance of manila dismissing the complaint as to plaintiff

Marquez.

The pertinent allegations of the complaint are as follo

that plaintiff Gutierrez Lora was authorized by defendant

negotiate the sale of their share or interest in a parcel of lan

Plaza Goiti, Manila, and having meet his co-plaintiff L. G. Marqu

real estate broker, both of them agreed to work together for

sale of defendant's property; that they found a ready, willing,

able buyer, which accepted defendants' price and terms, but

thereafter defendants, without any justifiable reason, refuse

carry out the sale and execute the necessary deed therefor; and

as a consequence plaintiffs failed to receive the commission w

they were entitled to receive.

The defendants presented a motion to dismiss

complaint as to L. G . Marquez on the ground that he has no ca

of action against defendants , and this motion having been gran

plaintiff L. G. Marquez has prosecuted this appeal.

The complaint was dismissed on the alleged ground th

states no cause of action against the defendants.




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Issue:

Whether or not the objection to the complaint justified./

Whether or not the complaint of Marquez is properly dismissed. No

Whether or not there is a cause of action in favor of

Marquez against the defendants. Yes.

Held:

The term "cause of action" has been held to be

synonymous with "right of action" , but in the law of pleading(Code Pleading) one is distinguished from the other in that a right

of action is a remedial right belonging to some person, while a

cause of action is a formal statement of the operative facts that

give rise to such remedial right. The one is a matter of right and

depends on the substantive law, while the other is a matter of

statement and is governed by the law of procedure. (Phillips, Code

Pleading, section 189, page 170.)

It is not denied that Lora, if he rendered the service

alleged in the complaint, would have a right to be paid

compensation for the service he rendered jointly with Marquez. He

acted as a broker, and a broker is entitled to a commission for his

services. (Article 277, Code of Commerce: Henry vs. Velasco, 34 Phil.587; Perez de Tagle vs. Luzon Surety Co, 38 Off. Gaz. 1213).

There is no prohibition in law against the employment of a

companion to look for a buyer; neither is it against public policy.

Neither was there even any implied understanding between Lora

and the defendants that no part of the compensation to which Lora

would be entitled to receive could be paid to any companion or

helper of Lora. Marquez's right to compensation can not, therefore,

be disputed under the operative facts set forth in the complaint.

There is a primary right in favor of Marquez (to be paid

for his services even through Lora only) and a corresponding duty

devolving upon the defendants (to pay for said services). Since (asalleged) defendants refuse to comply with their duty, Marquez

now is entitled to enforce his legal right by an action in court. The

complaint in the case at bar, therefore, contains both the primary

right and duty and the delict or wrong combined which constitute

the cause of action in the legal sense as used in Code Pleading

(Pomeroy, Code Remedies, section 347), and the cause of action is

full and complete.

Objection to the complaint, however, is not that Marquez

has no right to share in the compensation to be paid Lora, whom

defendants had directly engaged, but that Marquez can not join in

this action and enforce therein his rights directly against the

defendants, evidently because defendants never dealt with

Marquez, directly or indirectly, or, in other words, that both

Marquez and his services were not known to dismiss show that

such in fact was the objection:

This paragraph clearly shows that the authority

to sell was only given to plaintiff Z. Gutierrez Lora and not

to the other plaintiff L. G. Marquez. Attention is

respectfully called to the word "plaintiff" used in said

paragraph III and expressed in singular form to the

exclusion of the other plaintiff L. G. Marquez. If the

plaintiff L. G. Marquez had worked at all for the sale of the

property at the instance of an invitation of his co- plaintiff

Z. Gutierrez Lora, we maintain that his action if the

any is against his co-plaintiff and not against

defendants herein.

As far as the defendant are concerned in

case, plaintiff L. G. Marquez is not only a stranger in

case but also unknown to the defendants; and if he

worked at all for the sale of the defendants' share

participation in the parcels of lands referred to in

complaint, the same was made not only at his own lout, risk and responsibility but also with no authority

whatsoever. (Record on Appeal, pages 16, 17)

The principle underlying defendants' objection is on

substantive law, recognized under common law, where no one c

sue for a breach of a contract who was not a party thereto, and

action allowed to be brought only in the name of the one ho

the legal title. The requirement was based upon the doctrin

privity of contract.

Sec. 234. Plaintiffs in Action ex Contractu

When an action of contract concerns only the ori

parties to the instrument, it is not difficult to determwho should be the plaintiff. Obviously the one seekin

enforce it is the real party in interest. At common law

one could sue for the breach of contract who was n

party thereto. Hence an action on contract, whe

express or implied, was required to be brought in

name of the one who held the legal interest.

requirement was based upon the doctrine of privit

contract. . . . (Phillips, Code Pleading, page 226.)

Sec. 235. Privity of Contract . — When neces

— It was a rule of the common law that before one

complain of another for breach of contract, there mus

some direct contractual relation, or privity, between thand this, with only a few exceptions, is a requiremen

the law today. . . . (Phillips, code Pleading, page 227.)

But we did not import into this jurisdiction the com

law procedure. Our original code of civil Procedure (Act 190)

taken mainly from the code of Civil Procedure of California, and

in turn was based upon the Code of Civil procedure of New Y

adopted in that stated in 1948. Our system of pleading is C

Pleading that system used in the states of the Union that

adopted codes of procedure. The code system of pleading ado

in substance the rules of equity practice as to parties, under w

"all persons having an interest in the subject of the action, an

obtaining the relief demanded, may be joined as plaintiffs". (Phi

Code Pleading, section 251, page 247.) In New York and Califo

interest in the subject matter, or in any relief growing out of

same transaction or series of transactions is sufficient to a

joinder

Under the former Code of civil procedure "every ac

must be prosecuted in the name of the real party in interest,"

"all persons having an interest in the subject of the action an

obtaining the relief demanded shall be joined as plaintiffs, " and

any person having an interest and in obtaining the relief deman

refuses to join as plaintiff, he may be made a defendant and the




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of his interest and refusal to join to be stated in the complaint." (

Section 114, Act 190)

The principle underlying the rule is that all persons having

a material interest under the substantive law should be made

parties, as distinguished from that of the common law which

allowed only a two-sided controversy, each party to be opposed to

the other. Phillips, Code Pleading, 2d ed. section 228, page 216.)

The above principles have not been changed by the

reforms in the rules in 1940 and 1941. The action is still to beprosecuted in the name of the real party in interest. Under section 6

of Rule 3, "All persons in whom . . . any right to relief in respect to or

arising out of the same transaction . . . is alleged to exist, whether

jointly, severally, or in the alternative, may, . . . join as plaintiffs . . .

where any question of law or fact common to all such plaintiffs . . .

may arise in the action;

Plaintiff Marquez, in the case at bar, clearly falls under the

above rule. He is entitled to be paid his commission out of the very

contract of agency between Lora and the defendants; Lora and he

acted jointly in rendering services to defendants under Lora's

contract, and the same questions of law and fact govern their

claims. The rules do not require the existence of privity of contractbetween Marquez and the defendants as required under the

common law; all that they demand is that Marquez has a material

interest in the subject of the action, the right to share in the broker's

commission to be paid Lora under the latter's contract, which right

Lora does not deny. This is sufficient to justify the joinder of

Marquez as a party plaintiff, even in the absence of privity of

contract between him and the defendants.

Failure to state a cause of action

REMITERE vs MONTINOLA VDA. DE YULO

G.R. No. L-19751, February 28, 1966

Facts:

Remitere filed a complaint against the defendants-

appellees, Montinola and the Register of Deeds of Negros

Occidental. A parcel of land was registered in the name of Remedios

Montinola Vda. de Yulo, the defendant herein.

Prior to the transfer, the public sale mentioned in this

complaint, however, was and still is absolutely a void sale, and

certainly did not pass titles and ownership of said lots, starting from

its primitive owner, now being represented by the plaintiffs herein,

as surviving heirs thereto, until it reaches the possession by the

defendant. That by reason of its invalidity, all and every benefits that

the transferees, including the defendant herein, had acquired from

the parcels of land in question, should be indemnified to the

plaintiffs.

The complaint prayed that the defendants be ordered to

reconvey the two lots in question to the plaintiffs; that the

defendant Register of Deeds be ordered to cancel the certificates of

title in the name of the defendant Remedios Montinola Viuda de

Yulo and to issue new ones in the names of the plaintiffs; and

the defendants pay the costs.

The defendants-appellees filed a motion to dismiss

complaint on the grounds (1) that the complaint does not sta

cause of action, and (2) that even assuming that a cause of ac

exists, the same has already prescribed.

The lower court dismissed the complaint precisely on

grounds relied upon by the defendants-appellees. Hence this app

In this appeal, the plaintiffs-appellants contend thattrial court erred: (1) in declaring that the complaint contain

narration of facts; (2) in holding that complaint states no caus

action; and (3) in holding that the plaintiffs' cause of action, if

has already prescribed.

Issue:

Whether or not the complaint states no cause of actio

Held:

Yes. The lower court had correctly ruled that the comp

in the present case does not narrate facts that constitute a caus

action.The lack of a cause of action as a ground for dismissal m

appear on the face of the complaint, and to determine whethe

complaint states a cause of action only the facts alleged therein,

no other, should be considered. A reading of the complaint in

case will readily impress one that no ultimate facts which

constitute the basis of plaintiffs-appellants rights which had b

violated are alleged. Neither are there allegations of ultimate f

showing acts or omissions on the part of the defendants-appe

which constitute a violation of the rights of plaintiffs-appella

Apparently, the plaintiffs-appellants rely on the allegation

paragraphs 3 and 5 of the complaint for their cause of ac

Paragraph 3 states:3. Upon the demise of Gregorio Remitere on Janua

1914 the Court of First Instance of Negros Occidenta

Civil Case No. 1661, Re-Application for Letters

Administration, appointed his wife as administratrix o

estate, among which the two lots in question.

During this period, the provincial sheriff of Ne

Occidental, conducted a public auction sale over the

parcels of land, and on the same day, September 23, 1

he issued thereof a deed of sale in favor of Mariano

of Binalbagan, Negros Occidental, for the

consideration of P20,000.00. . . . .

The allegations embodied in the above quoted parag

are mere averments or recitals of facts that do not establish

right or claim on the part of the plaintiffs. The allegations do

state any connection that the plaintiffs have with the dece

Gregorio Remitere, nor do they state what connection or claim

plaintiffs have on the properties left by the deceased Greg

Remitere. The allegation about the sale at public auction does

state in what way the rights or interests of the plaintiffs had b

affected, nay prejudiced, by that sale. Again, paragraph 5 of

complaint states:




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5. The public sale mentioned in paragraph 3 of this

complaint, however, was and still is absolutely a void sale,

and certainly did not pass titles and ownership of said lots,

starting from its primitive owner, now being represented

by the plaintiffs herein, as surviving heirs thereto, until it

reaches the possession by the defendants.

That by reason of its invalidity, all and every benefits that

the transferees, including the defendant herein, had

acquired from the parcels of land in question, should beindemnified to the plaintiffs.

It is not stated anywhere in the complaint why the sale at

public auction was absolutely void, nor were there stated any

particular facts or circumstances upon which the alleged nullity of

the sale or transaction is predicated. The averment that "the public

sale . . . was and still is absolutely a void sale, and certainly did not

pass titles and ownerships of said lots, starting from its primitive

owner, now being represented by the plaintiffs herein, as surviving

heirs thereto, until it reaches the possession by the defendants. . ."

is a conclusion of law or an inference from facts not stated in the

pleading. A pleading should state the ultimate facts essential to therights of action or defense asserted, as distinguished from mere

conclusion of fact, or conclusion of law. An allegation that a

contract is valid, or void, as in the instant case, is a mere conclusion

of law.

General allegations that a contract is valid or legal, or is

just, fair and reasonable, are mere conclusion of law.

Likewise, allegations that a contract is void, voidable,

invalid, illegal, ultra vires, or against public policy, without

stating facts showing its invalidity, are mere conclusions of

law; as are allegations that a contract is in conformity

with, or in violation of a constitutional or statutory

provision. . . . . (71 C.J.S. pp. 44-45.) (Emphasis supplied.)

Not being statements of ultimate facts which constitute

the basis of a right of the plaintiffs-appellants, nor are they

statements of ultimate facts which constitute the wrongful acts or

omissions of the defendants-appellees that violated the right of

the plaintiffs-appellants the allegations of the complaint in the

present case have not fulfilled the requirements of Section 3, Rule

6 of the Revised Rules of Court (Sec. 1, Rule 6 of the former Rules

of Court) that the complaint should contain a "concise statement

of the ultimate facts constituting the plaintiff's cause or causes of

action."

This Court has defined the term "cause of action" as

follows:

A cause of action has been defined by the

Supreme Court as an act or omission of one party in

violation of the legal right or rights of the other; and its

essential elements are legal right of the plaintiff,

correlative obligations of the defendant, and act or

omission of the defendant in violation of said legal right.

(Ma-ao Sugar Central Co., Inc. vs. Barrios, et al., L-1539,

Dec. 30, 1947)

The term "ultimate facts" has been defined or explained as follow

Ultimate facts defined .—The term "ultim

facts" as used in Sec. 3, Rule 3 of the Rules of Court, m

the essential facts constituting the plaintiff's caus

action. A fact is essential if it cannot be stricken

without leaving the statement of the cause of ac

insufficient. . . . . (Moran, Rules of Court, Vol. I, 1963 ed

213)

Ultimate facts are important and substafacts which either directly form the basis of the prim

right and duty, or which directly make up the wron

acts or omissions of the defendant. The term does

refer to the details of probative matter or particula

evidence by which these material elements are to

established. It refers to principal determinate, constitu

facts, upon the existence of which, the entire caus

action rests. (Montemayor vs. Raborar, et al., 53 O.G.

19, p. 6596, citing Pomeroy, Code Remedies, 5th Ed.,

420).

Test of the sufficiency of a cause of action

MISAMIS OCCIDENTAL II COOPERATIVE, INC. vs DAVID

G.R. No. 129928, August 25, 2005

Facts:

Private respondent David, a supplier of elect

hardware, filed a case for specific performance and damages agaMOELCI II, a rural electric cooperative in Misamis Occidental.

said case, which was essentially a collection suit, pending be

Judge Felixberto Olalia (hereinafter, Judge Olalia) of the RTC Ma

was predicated on a document and that according to David is

contract pursuant to which he sold to MOELCI II one (1) unit o

MVA Transformer.

MOELCI II filed its Answer to Amended Complaint w

pleaded, among others, affirmative defenses which also const

grounds for dismissal of the complaint. These grounds were lac

cause of action, there being allegedly no enforceable cont

between David and MOELCI II under the Statute of Frauds purs

to Section 1 (g) and (i), Rule 16 of the Rules of Court, and impr

venue.

MOELCI II filed with the trial court a Motion

Preliminary Hearing of Affirmative Defenses and Deferment of

Trial Conference) (hereinafter referred to as Motion) arguing tha

document attached as Annex "A" to the Amended Complaint

only a quotation letter and not a contract as alleged by David. T

it contends that David’s Amended Complaint is dismissible for fa

to state a cause of action.

David contended in the main that because a motio

dismiss on the ground of failure to state a cause of action is requ

to be based only on the allegations of the complaint, the "quota




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letter," being merely an attachment to the complaint and not part of

its allegations, cannot be inquired into.

MOELCI II filed a rejoinder to the opposition in which it

asserted that a complaint cannot be separated from its annexes;

hence, the trial court in resolving a motion to dismiss on the ground

of failure to state a cause of action must consider the complaint’s

annexes.

Judge Olalia issued an order denying MOELCI II’s motion

for preliminary hearing of affirmative defenses. MOELCI II’s motionfor reconsideration of the said order was likewise denied in another

order.

MOELCI II elevated this incident to the Court of Appeals by

way of a special civil action for certiorari, alleging grave abuse of

discretion on the part of Judge Olalia in the issuance of the two

aforesaid orders.

Court of Appeals dismissed MOELCI II’s petition holding

that the allegations in David’s complaint constitute a cause of action.

With regard to MOELCI II’s contention that David’s Amended

Complaint is dismissible as the document, attached thereto as Annex

"A," upon which David’s claim is based is not a contract of sale but

rather a quotation letter, the Court of Appeals ruled that theinterpretation of the document requires evidence aliunde which is

not allowed in determining whether or not the complaint states a

cause of action. The appellate court further declared that when the

trial court is confronted with a motion to dismiss on the ground of

lack of cause of action, it is mandated to confine its examination for

the resolution thereof to the allegations of the complaint and is

specifically enjoined from receiving evidence for that purpose.

With the denial of its Motion for Reconsideration,

petitioner is now before this Court seeking a review of the appellate

court’s pronouncements. MOELCI II asserts that the Court of Appeals

committed serious error in: (1) ruling that the resolution of its

motion to dismiss on the ground of lack of cause of actionnecessitated hearings by the trial court with the end in view of

determining whether or not the document attached as Annex "A" to

the Amended Complaint is a contract as alleged in the body of said

pleading; and (2) not ordering the trial court to dismiss the Amended

Complaint on the ground of lack of cause of action. Anent the first

ground, MOELCI II further claims that with the denial of its Petition,

the appellate court in effect exhorted the trial court to defer the

resolution of its motion to dismiss until after the hearing of the case

on the merits contrary to Rule 16 of the Rules of Court and well-

settled jurisprudence.

Issue:

Whether or not the Court of Appeals erred in dismissing

the petition for certiorari and in holding that the trial court did not

commit grave abuse of discretion in denying petitioner’s Motion.

Held:

No.

To determine the existence of a cause of action, only the

statements in the complaint may be properly considered. It is error

for the court to take cognizance of external facts or hold

preliminary hearings to determine their existence. If the

allegations in a complaint furnish sufficient basis by which the

complaint can be maintained, the same should not be dismi

regardless of the defenses that may be averred by the defenda

The test of sufficiency of facts alleged in the complain

constituting a cause of action is whether or not admitting the f

alleged, the court could render a valid verdict in accordance w

the prayer of said complaint.

It has been hypothetically admitted that the parties

entered into a contract sale David bound himself to supply MOE

(1) unit 10 MVA Power transformer with accessories for a total pof P5,200,000.00 plus 69 KV Line Accessories for a total pric

P2,169,500.00; that despite written and verbal demands, MOEL

has failed to pay the price thereof plus the custom duties

incidental expenses of P272,722.27; and that apart from

previously stated contract of sale, David regularly delivered va

electrical hardware to MOELCI II which, despite demands, ha

outstanding balance of P281,939.76.

The court believed all the foregoing sufficiently lay o

cause of action. Even extending our scrutiny to Annex "A," whi

after all deemed a part of the Amended Complaint , will not resu

a change in our conclusion. The interpretation of a docum

requires introduction of evidence which is precisely disallowedetermining whether or not a complaint states a cause of act

The Court of Appeals therefore correctly dismissed MOELCI

petition and upheld the trial court’s ruling.


QUADRA vs CA

G.R. No. 147593, July 31, 2006

Facts:

Petitioner Quadra was the Chief Legal Officer

respondent Philippine Charity Sweepstakes Office (PCSO) whe

organized and actively participated in the activities of Philip

Charity Sweepstakes Employees Association (CUGCO),

organization composed of the rank and file employees of PCSO,

then later, the Association of Sweepstakes Staff Personnel

Supervisors (CUGCO) (ASSPS [CUGCO]).

He was administratively charged before the Civil Se

Commission with violation of Civil Service Law and Rules for neg

of duty and misconduct and/or conduct prejudicial to the intere

the service. Civil Service Commission rendered a decision fin

petitioner guilty of the charges and recommending the penalt

dismissal. General Manager of PCSO, Ignacio Santos Diaz,

petitioner a letter of dismissal, in accordance with the decisio

the Civil Service Commission.

Petitioner filed a motion for reconsideration of

decision of the Civil Service Commission. At the same t

petitioner, together with ASSPS (CUGCO), filed with the Cou

Industrial Relations (CIR) a complaint for unfair labor practice ag

respondent PCSO and its officers.




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CIR issued its decision finding respondent PCSO guilty of

unfair labor practice for having committed discrimination against the

union and for having dismissed petitioner due to his union activities.

It ordered the reinstatement of petitioner to his former position

with full backwages and with all the rights and privileges pertaining

to said position.

Respondent PCSO complied with the decision of the CIR.

But while it reinstated petitioner to his former position and paid his

backwages, it also filed with the Supreme Court a petition for reviewon certiorari entitled "Philippine Charity Sweepstakes Office, et al. v.

The Association of Sweepstakes Staff Personnel, et al." assailing the

decision of the CIR in Case No. 4312-ULP.

During the pendency of the case in the Supreme Court,

petitioner filed with the CIR a "Petition for Damages." He prayed for

moral and exemplary damages in connection with Case No. 4312-

ULP.

Respondent PCSO moved to dismiss the petition for

damages on the following grounds: (1) the CIR has no jurisdiction to

award moral and exemplary damages; (2) the cause of action is

barred by prior judgment, it appearing that two complaints are

brought for different parts of a single cause of action; and (3) thepetition states no valid cause of action.

Petitioner resigned from PCSO . The petition for damages

and the motion to dismiss, however, remained pending with the CIR

until it was abolished and the NLRC was created. Labor Arbiter

rendered a decision awarding moral and exemplary damages to

petitioner . The NLRC affirmed the decision of the Labor Arbiter,

prompting respondent PCSO to file a petition for certiorari with the

Court of Appeals.

The Court of Appeals reversed the decision of the NLRC. It

held that there was no basis for the grant of moral and exemplary

damages to petitioner as his dismissal was not tainted with bad

faith. It was the Civil Service Commission that recommendedpetitioner's dismissal after conducting an investigation. It also held

that the petition claiming moral and exemplary damages filed by

petitioner after respondent PCSO had complied with the CIR

decision of reinstatement and backwages amounted to splitting of

cause of action.

Petitioner filed a motion for reconsideration of the

decision of the Court of Appeals, but the same was denied for lack

for merit.

Petitioner now seeks the Court to review the ruling of the

Court of Appeals. He argued that:

First: The ruling of the Court of Appeals that the PCSO did

not act in bad faith when it dismissed the petitioner is contrary to

the already final and executory decision of the CIR finding the PCSO

guilty of bad faith and unfair labor practice in dismissing the

petitioner. The decision of the CIR was affirmed by the High Court in

the case of PCSO. The Court of Appeals has no jurisdiction to amend

the final and executory decision of the CIR which was affirmed by

the High Court. Once a decision has become final [and] executory, it

could no longer be amended or altered.

Second: The ruling of the Court of Appeals that the claims

for moral and exemplary damages of the petitioner is allegedly

"tantamount to splitting of cause of action under Sec. 4, Rule 2 of

the 1997 Rules of Civil Procedure" is contrary to law. When

petitioner filed with the CIR his complaint for illegal dismissal

unfair labor practice, the prevailing law and jurisprudence was

the CIR did not have jurisdiction to grant moral and exemp

damages. Petitioner's claim for moral damages was filed with

CIR in the same case by virtue of the ruling of the High Cou

Rheem v. Ferrer, 19 SCRA 130 holding that the CIR has jurisdictio

award moral and exemplary damages arising out of illegal dism

and unfair labor practice.

Issue:

Whether or not petitioner’s contention is correct.

contention)

Held:

Yes. The court ruled that the filing of a petition

damages before the CIR did not constitute splitting of caus

action under the Revised Rules of Court. The Revised Rules of C

prohibits parties from instituting more than one suit for a s

cause of action. Splitting a cause of action is the act of dividi

single cause of action, claim or demand into two or more p

and bringing suit for one of such parts only, intending to resthe rest for another separate action. The purpose of the rule

avoid harassment and vexation to the defendant and a

multiplicity of suits.

The prevailing rule at the time that the action for u

labor practice and illegal dismissal was filed and tried before the

was that said court had no jurisdiction over claims for dama

Hence, petitioner, at that time, could not raise the issue of dama

in the proceedings. However, on January 27, 1967, the Supr

Court rendered its ruling in Rheem of the Philippines, Inc., et a

Ferrer, et al. upholding the jurisdiction of the CIR over claims

damages incidental to an employee's illegal dismissal. Petiti

properly filed his claim for damages after the declaration byCourt and before the ruling on their case became final. Such f

could not be considered as splitting of cause of action.


BACHRACH MOTOR vs ICARANGAL

G.R. No. L-45350, May 29, 1939

Facts:

Icarangal with Figueroa executed a promissory not

favor of appellant Bachrach in the amount of P1,614. As a sec

for its payment, Icarangal executed a real estate mortgage o

parcel of land which was duly registered in the RD in 1931. W

the promissors defaulted in the payment of the agreed mon

installments, Bachrach instituted in the CFI an action for collec

of the amount due on the note. Judgement was rendered in favo

Bachrach, thereafter, a writ of execution was issued and

properties of Icarangal was subsequently levied by the sh

including the mortgaged property.




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Oriental Commercial Co., Inc. (Oriental), the other defendant,

interposed a third-party claim, alleging that the mortgaged property

had already been acquired by it thru public auction in 1933. By said

reason, the sheriff desisted from the sale of the property, and as a

consequence, the judgement rendered in favor of Bachrach

remained unsatisfied. Bachrach instituted an action to foreclose the

mortgage. The trial court dismissed the complaint, hence, the filing

of the present appeal.

Issue:

Whether or not Bachrach is barred from foreclosing the

real estate mortgage after obtaining a personal judgment against

Icarangal on the promissory note.

Held:

YES. The rule against splitting a single cause of action is

intended "to prevent repeated litigation between the same parties

in regard to the same subject of controversy; to protect defendant

from unnecessary vexation; and to avoid the costs and expenses

incident to numerous suits." It comes from that old maxim nemo

bedet bis vexare pro una et eadem cause (no man shall be twicevexed for one and the same cause). And it developed, certainly not

as an original legal right of the defendant, but as an interposition of

courts upon principles of public policy to prevent inconvenience and

hardship incident to repeated and unnecessary litigations.

For non-payment of a note secured by mortgage, the creditor has a

single cause of action against the debtor. This single cause of action

consists in the recovery of the credit with execution of the security.

In other words, the creditor in his action may make two demands,

the payment of the debt and the foreclosure of his mortgage. But

both demands arise from the same cause, the non-payment of the

debt, and, for that reason, they constitute a single cause of action.Though the debt and the mortgage constitute separate agreements,

the latter is subsidiary to the former, and both refer to one and the

same obligation. Consequently, there exists only one cause of action

for a single breach of that obligation.

Plaintiff, then, by applying the rule above stated, cannot

split up his single cause of action by filing a complaint for payment

of the debt, and thereafter another complaint for foreclosure of the

mortgage. If he does so, the filing of the first complaint will bar the

subsequent complaint. By allowing the creditor to file two separate

complaints simultaneously or successively, one to recover his credit

and another to foreclose his mortgage, we will, in effect, be

authorizing him plural redress for a single breach of contract at so

much cost to the courts and with so much vexation and oppression

to the debtor.

We hold, therefore, that, in the absence of express

statutory provisions, a mortgage creditor may institute against the

mortgage debtor either a personal action for debt or real action to

foreclose the mortgage. In other words, he may pursue either of the

two remedies, but not both. By such election, his cause of action can

by no means be impaired, for each of the two remedies is complete

in itself. Thus, an election to bring personal action will leave open to

him all the properties of the debtor for attachment and execution,

even including the mortgaged property itself. And, if he waives such

personal action and pursues his remedy against the mortga

property, an unsatisfied judgment thereon would still give him

right to sue for a deficiency judgment, in which case, all

properties of the defendant, other than the mortgaged property

again open to him for the satisfaction of the deficiency. In e

case, his remedy is complete, his cause of action undiminished,

any advantages attendant to the pursuit of one or the other rem

are purely accidental and are all under his right of election. On

other hand, a rule that would authorize the plaintiff to bripersonal action against the debtor and simultaneously

successively another action against the mortgaged property, w

result not only in multiplicity of suits so offensive to ju

(Soriano vs. Enriquez, 24 Phil., 584) and obnoxious to law and eq

(Osorio vs. San Agustin, 25 Phil., 404), but also in subjecting

defendant to the vexation of being sued in the place of his reside

of the plaintiff, and then again in the place where the property li

In arriving at the foregoing conclusion, we are

unaware of the rule prevailing in certain States of the Amer

Union, to the effect that, in cases like the one at bar, the cred

can pursue his remedies against the note and against the sec

concurrently or successively. The reason given for the rule seembe that the causes of action in the two instances are not the sa

one being personal and the other, real. But, as we have hereto

stated, the creditor's cause of action is not only single but indivis

although the agreements of the parties, evidenced by the note

the deed of mortgage, may give rise to different reme

(Frost vs. Witter, 132 Cal., 421.) The cause of action should no

confused with the remedy created for its enforcement.

considering, as we have shown, that one of the two reme

available to the creditor is as complete as the other, he canno

allowed to pursue both in violation of those principles of proced

intended to secure simple, speedy and unexpensive administra

of justice.Judgment is affirmed, with costs against the appellant.


CITY OF BACOLOD vs SAN MIGUEL BREWERY

G.R. No. L-25134, October 30, 1969

Facts:

In 1949, the City Council of Bacolod passed Ordinance

66, series of 1949, imposing upon any person or corpora

engaged in the manufacturing of bottling products such as softd

within the jurisdiction of the City of Bacolod, a fee of 1/24

centavo for every bottle thereof, plus surcharge of 2% every mo

but in no case to exceed 24% for one whole year for the delinq

manufacturer.

In 1959, the ordinance was amended by Ordinance

150, series of 1959, by increasing the fee to 1/8 of a centavo

every bottle thereof, or an increased from P0.01 to P0.03 per ca

softdrinks. San Miguel Brewery, Inc. (San Miguel) refused to pay

additional fee and challenged the validity of the whole ordinance




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In 1960, the City Council sued San Miguel before the CFI for the

payment of the unpaid bottling taxes due with legal interests and

for the payment of P0.03 per case bottling tax . San Miguel filed its

answer. The trial court rendered judgement in favor of the appellee.

Appellant appealed the said decision to SC where it

pressed the question of the invalidity of the above mentioned taxing

ordinances. The SC affirmed the CFI decision and upheld the

constitutionality of the taxing ordinances. After the finality of the SC

decision, the appellee (City Council) moved for the reconsiderationthereof, praying that the same be amended so as to include the

penalties and surcharges provided for in the ordinances. The said

motion was denied, for the reason the “the decision is already final

and may not be amended”. During the execution before the CFI, the

appellee again sought the inclusion of the surcharges referred to,

the said motion was denied.

Appellee filed before the CFI a second action/complaint to

collect the said surcharges. Appellant move for the dismissal of the

complaint anchored on two grounds: (1) the cause of action is

barred by prior judgment, and (2) a party may not institute more

than one suit for a single cause of action. This motion was denied by

the trial court, and so the appellant filed its answer. The trial courtrendered judgment in favor of the appellee. Appellants moved for a

reconsideration but it was denied, hence, the instant appeal.

Issue:

Whether or not the actions of the appellee splits up a

single cause of action.

Held:

YES. It cannot be denied that appellant's failure to pay the

bottling charges or taxes and the surcharges for delinquency in the

payment thereof constitutes but one single cause of action which

under the above rule can be the subject of only one complaint,under pain of either of them being barred if not included in the

same complaint with the other. The error of appellee springs from a

misconception or a vague comprehension of the elements of a cause

of action.

The classical definition of a cause of action is that it is "a

delict or wrong by which the rights of the plaintiff are violated by the

defendant." Its elements may be generally stated to be (1) a right

existing in favor of the plaintiff; (2) a corresponding obligation on

the part of the defendant to respect such right; and (3) an act or

omission of the plaintiff which constitutes a violation of the

plaintiff's right which defendant had the duty to respect. For

purposes, however, of the rule against splitting up of a cause of

action, a clearer understanding can be achieved, if together with

these elements, the right to relief is considered.

In the last analysis, a cause of action is basically an act or

an omission or several acts or omissions. A single act or omission can

be violative of various rights at the same time, as when the act

constitutes juridically a violation of several separate and distinct

legal obligations. In other words, for a single cause of action or

violation of a right, the plaintiff may be entitled to several reliefs. It

is the filing of separate complaints for these several reliefs that

constitutes splitting up of the cause of action. This is what is

prohibited by the rule.

In the case at bar, when appellant failed and refuse

pay the difference in bottling charges from July 1, 1959, such a

appellant in violation of the right of appellee to be paid said cha

in full under the Ordinance, was one single cause of action,

under the Ordinance, appellee became entitled, as a result of

non-payment, to two reliefs, namely: (1) the recovery of the bala

of the basic charges; and (2) the payment of the correspon

surcharges, the latter being merely a consequence of the failur

pay the former. Stated differently, the obligation of appellant tothe surcharges arose from the violation by said appellant of

same right of appellee from which the obligation to pay the b

charges also arose. Upon these facts, it is obvious that appellee

filed separate complaints for each of two reliefs related to the s

single cause of action, thereby splitting up the said cause of actio

The trial court held that inasmuch as there was no dem

in the complaint in the first case for the payment of the surcha

unlike in the case of Collector of Internal Revenue vs. Blas Gutie

et al ., G.R. No. L-13819. May 25, 1960, wherein there was su

demand, there is no bar by prior judgment as to said surcharges,

same not having been "raised as an issue or cause of action in

Case No. 5693." This holding is erroneous.Section 4 of Rule 2, above-quoted, is unmistakably cle

to the effect of the splitting up of a cause of action. It says

separate complaints are brought for different parts (reliefs)

single cause of action, the filing of the first (complaint) may

pleaded in abatement of the others, and a judgment upon

merits in either is available as a bar in the others." In other wo

whenever a plaintiff has filed more than one complaint for

same violation of a right, the filing of the first complaint on an

the reliefs born of the said violation constitutes a bar to any ac

on any of the other possible reliefs arising from the same violat

whether the first action is still pending, in which event, the def

to the subsequent complaint would be litis pendentia, or italready been finally terminated, in which case, the defense w

be res adjudicata. Indeed, litis pendentia and res adjudicata, on

one hand, and splitting up a cause of action on the other, are

separate and distinct defenses, since either of the former is by

only the result or effect of the latter, or, better said, the sanctio

or behind it.

It thus results that the judgment of the lower court m

be, as it is hereby, reversed and the complaint of appelle

dismissed. No costs.


ADA vs BAYLON

G.R. No. 182435, August 13, 2012

Background of the case:

Spouses Florentino and Maximina Baylon died in 1961 and 1

respectively. Children: Rita, Victoria, Dolores, Panfila, Ramon

Lilia, herein petitioner. Dolores died intestate and without issu

1976. Victoria died in 1981 and was survived by daughter,

herein petitioner. Ramon died intestate in 1989, and was surv

by herein respondent Florante, his child from his first marriage,




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Flora his second wife, and their legitimate children, the other herein

petitioners.

Facts:

Petitioners filed with the RTC a complaint for partition,

accounting and damages against Florante, Rita and Panfila, alleging

therein that Spouses Baylon, during their lifetime, owned 43 parcels

of land all situated in Negros Oriental. After the death of Spouses

Baylon, they claimed that Rita took possession of the said parcels of

land and appropriated for herself the income from the same. Usingthe income produced by the said parcels of land, Rita allegedly

purchased two parcels of land. The petitioners averred that Rita

refused to effect a partition of the said parcels of land.

In their Answer, Florante, Rita and Panfila asserted that

they and the petitioners co-owned 22 out of the 43 parcels of land

mentioned in the latter’s complaint, whereas Rita actually

owned

parcels of land, 10 out of the 43 parcels which the

petitioners sought to partition, while the remaining parcels of land

are separately owned by Petra Cafino Adanza, Florante, Meliton

Adalia, Consorcia Adanza, Lilia & Santiago Mendez. Further, they

claimed that the 2 parcels of land, claimed to be brought from the

income produced from the estate of the late spouses, were acquiredby Rita using her own money. They denied that Rita appropriated

solely for herself the income of the estate of Spouses Baylon, and

expressed no objection to the partition of the estate of Spouses

Baylon, but only with respect to the co-owned parcels of land.

During the pendency of the case, Rita, through a Deed of

Donation, conveyed the 2 above mentioned parcels of land to

Florante. On July 16, 2000, Rita died intestate and without any issue.

Thereafter, learning of the said donation inter vivos in favor of

Florante, the petitioners filed a Supplemental Pleading, praying

that the said donation in favor of the respondent be rescinded in

accordance with Article 1381(4) of the Civil Code. They further

alleged that Rita was already sick and very weak when the said Deedof Donation was supposedly executed and, thus, could not have

validly given her consent thereto.

Florante and Panfila opposed the rescission of the said

donation, asserting that Article 1381(4) of the Civil Code applies only

when there is already a prior judicial decree on who between the

contending parties actually owned the properties under litigation.

RTC Decision:

The RTC held that the death of Rita during the pendency of

the case, having died intestate and without any issue, had rendered

the issue of ownership insofar as parcels of land which she claims as

her own moot since the parties below are the heirs to her estate.

Thus, the RTC regarded Rita as the owner of the said 10 parcels of

land and, accordingly, directed that the same be partitioned among

her heirs. Nevertheless, the RTC rescinded the donation inter

vivos in favor of Florante, holding that the donation inter vivos was

executed to prejudice the plaintiffs’ right to succeed to the estate of

Rita in case of death considering that it refers to the parcels of land

in litigation.

Florante sought reconsideration insofar as to the rescission of the

donation. The trial court denied the motion.

CA Decision:

On appeal, the CA rendered a decision reversing the

decision. The CA remanded the case to RTC for the determinatio

ownership of the said 2 parcels of land. The CA held that before

petitioners may file a rescission, they must first obtain a favor

judicial ruling that the subject 2 parcels of land belonged to

estate of Spouses Baylon and not to Rita. Until then, an action

rescission is premature.

The petitioners moved for the reconsideration, but it

denied, hence, the instant petition.

Issue:

Whether or not an action for partition and rescission

be joined in a single cause of action.

Held:

NO. There was a misjoinder of causes of action. The ac

for partition filed by the petitioners could not be joined with

action for the rescission of the said donation inter vivos in favo

Florante. Lest it be overlooked, an action for partition is a specivil action governed by Rule 69 of the Rules of Court while an ac

for rescission is an ordinary civil action governed by the ordi

rules of civil procedure. The variance in the procedure in the sp

civil action of partition and in the ordinary civil action of rescis

precludes their joinder in one complaint or their being tried

single proceeding to avoid confusion in determining what rules

govern the conduct of the proceedings as well as in

determination of the presence of requisite elements of

particular cause of action.

By a joinder of actions, or more properly, a joinde

causes of action is meant the uniting of two or more demand

rights of action in one action, the statement of more than one cof action in a declaration. It is the union of two or more civil ca

of action, each of which could be made the basis of a separate

in the same complaint, declaration or petition. A plaintiff may un

certain circumstances join several distinct demands, controversi

rights of action in one declaration, complaint or petition.[29]

The objectives of the rule or provision are to avo

multiplicity of suits where the same parties and subject matter

to be dealt with by effecting in one action a complete determina

of all matters in controversy and litigation between the pa

involving one subject matter, and to expedite the dispositio

litigation at minimum cost. The provision should be construed s

to avoid such multiplicity, where possible, without prejudice to

rights of the litigants.

Nevertheless, while parties to an action may assert in

pleading, in the alternative or otherwise, as many causes of actio

they may have against an opposing party, such joinder of cause

action is subject to the condition, inter alia, that the joinder shal

include special civil actions governed by special rules.

Disposition: WHEREFORE, in consideration of

foregoing disquisitions, the petition is PARTIALLY GRANTED.

Decision dated October 26, 2007 issued by the Court of Appea

CA-G.R. CV No. 01746 is MODIFIED in that the Decision d

October 20, 2005 issued by the Regional Trial Court, Tanjay




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Negros Oriental, Branch 43 in Civil Case No. 11657, insofar as it

decreed the rescission of the Deed of Donation dated July 6, 1997 is

hereby REINSTATED. The case is REMANDED to the trial court for

the determination of the ownership of Lot No. 4709 and half of Lot

No. 4706 in accordance with this Decision.

NOTES:

A misjoined cause of action, if not severed upon motion of a

party or by the court sua sponte, may be adjudicated by thecourt together with the other causes of action; not a ground for

dismissal

A supplemental pleading may raise a new cause of action as long

as it has some relation to the original cause of action set forth in

the original complaint

The purpose of supplemental pleading is to bring into the

records new facts which will enlarge or change the kind of

relief to which the plaintiff is entitled; hence, any

supplemental facts which further develop the original right

of action, or extend to vary the relief, are available by way

of supplemental complaint even though they themselvesconstitute a right of action.


SPS. PEREZ vs HERMANO

G.R. No. 147417, July 8, 2005

Facts:

The civil case filed by the petitioners before the trial court

against the respondents for “Enforcement of Contract and Damageswith Prayer for TRO (Branch 224) presented three (3) causes of

action: first, enforcement of contract to sell entered into between

petitioners and Zescon Land, Inc.; second, for the annulment or

rescission of two contracts of mortgage entered into between

petitioners and respondent Hermano; and third, for damages

against all defendants.

First cause of action: Sometime in 1997, petitioners

entered into a Contract of Sell with Zescon through Sales-Contreras,

for the purchase of 5 parcels of land in the total amount of

P19,104,000.00. as part of their agreement, a portion of the

purchase price would be paid to them as downpayment, another

portion to be given to them as cash advance upon the execution ofthe contract and another portion to be used by the buyer, Zescon, to

pay for loans earlier contracted by petitioners which loans were

secured by mortgages.

Second cause of action: In a tricky machination and

simultaneous with the execution of the aforesaid Contract of Sell,

they were made to sign other documents, two of which were

Mortgage deeds over the same 5 properties in favor of respondent

Hermano, whom they had never met. It was allegedly explained to

them by Sales-Contreras that the mortgage contracts would merely

serve to facilitate the payment of the price as agreed upon in their

Contract to Sell. They claim that it was never their intention to

mortgage their property to Hermano, more so that they have n

received a single centavo from the latter.

As to third cause of action, they prayed for dam


In his Answer with Compulsory Counterclaim, respon

Hermano denied petitioner’s allegations. He then filed a civil

for Judicial Foreclosure of Real Estate Mortgage (Branch

against petitioner Aviso. He also filed a ”Motion with Leav

Dismiss the Complaint Against Him or Ordered SeveredSeparate Trial” before Branch 224, arguing that there was a

joinder of causes of action under Rule 2, Section 6 of the Rule

Court.

The trial court (Branch 224) granted the said motion

the opposition of the petitioners, holding that respondent Herm

should be dropped as one of the defendants in this case

whatever claims petitioner may have against Hermano, they can

it up by way of an answer to said judicial foreclosure. Petition

motion for reconsideration was also dismissed.

They filed a petition for certiorari to the CA under Rule

however it was dismissed on mere technicality, the petition ha

been filed out of time. Hence, this petition after the denial of tmotion for reconsideration.

Issue:

Whether or not there was mis-joinder of causes of acti

Held:

NONE. The statutory intent behind the provisions

joinder of causes of action is to encourage joinder of actions w

could reasonably be said to involve kindred rights and wro

although the courts have not succeeded in giving a stan

definition of the terms used or in developing a rule of unive

application. The dominant idea is to permit joinder of causeaction, legal or equitable, where there is some substantial u

between them. While the rule allows a plaintiff to join as m

separate claims as he may have, there should nevertheless be s

unity in the problem presented and a common question of law

fact involved, subject always to the restriction thereon regar

jurisdiction, venue and joinder of parties. Unlimited joinder is

authorized.

Our rule on permissive joinder of causes of action,

the proviso subjecting it to the correlative rules on jurisdic

venue and joinder of parties and requiring a conceptual unity in

problems presented, effectively disallows unlimited joinder.

In herein case, petitioners have adequately alleged in t

complaint that after they had already agreed to enter into a cont

to sell with Zescon Land, Inc., through Sales-Contreras, the la

also gave them other documents to sign, to wit: A Deed of Abso

Sale over the same properties but for a lower consideration,

mortgage deeds over the same properties in favor of respond

Hermano with accompanying notes and acknowledgment rece

for Ten Million pesos (P10,000,000) each. Petitioners claim

Zescon Land, Inc., through Sales-Contreras, misled them

mortgage their properties which they had already agreed to se

the latter.




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From the above averments in the complaint, it becomes

reasonably apparent that there are questions of fact and law

common to both Zescon Land, Inc., and respondent Hermano arising

from a series of transaction over the same properties. There is the

question of fact, for example, of whether or not Zescon Land, Inc.,

indeed misled petitioners to sign the mortgage deeds in favor of

respondent Hermano. There is also the question of which of the four

contracts were validly entered into by the parties. Note that under

Article 2085 of the Civil Code, for a mortgage to be valid, it isimperative that the mortgagor be the absolute owner of the thing

mortgaged. Thus, respondent Hermano will definitely be affected if

it is subsequently declared that what was entered into by petitioners

and Zescon Land, Inc., was a Contract of Sale (as evidenced by the

Deed of Absolute Sale signed by them) because this would mean

that the contracts of mortgage were void as petitioners were no

longer the absolute owners of the properties mortgaged. Finally,

there is also the question of whether or not Zescon Land, Inc., as

represented by Sales-Contreras, and respondent Hermano

committed fraud against petitioners as to make them liable for

damages.

Prescinding from the foregoing, and bearing in mind thatthe joinder of causes of action should be liberally construed as to

effect in one action a complete determination of all matters in

controversy involving one subject matter, we hold that the trial

court committed grave abuse of discretion in severing from the

complaint petitioners’ cause of action against respondent Hermano.

WHEREFORE, premises considered, the Resolution of the

Court of Appeals dated 19 October 2000 dismissing petitioners’

petition for certiorari and its Resolution dated 02 March 2001

denying petitioners’ motion for reconsideration are REVERSED and

SET ASIDE. The petition for certiorari is hereby GRANTED. The Orders

of the Regional Trial Court of Quezon City, Branch 224, dated 28

February 2000 and 25 May 2000 are ANNULLED and SET ASIDE. TheRTC is further ordered to reinstate respondent Antonio Hermano as

one of the defendants in Civil Case No. Q-98-34211. No costs.

NOTES:

Requisites for Joinder of Causes of Action

(a) It will not violate the rules on jurisdiction, venue and joinder of

parties; and

(b) The causes of action arise out of the same contract, transaction

or relation between parties, or are for demands for money or

are of the same nature and character

Objectives of the rule or provision

(a) To avoid multiplicity of suits where the same parties and

subject matter are to be dealt with by effecting in one action a

complete determination of all matters in controversy and

litigation between the parties involving one subject matter; and

(b)

To expedite the disposition of litigation at minimum cost

Should be construed so as to avoid such multiplicity, where

possible, without prejudice to the rights of the litigants

Sec. 6. Misjoinder of causes of action. - Misjoinder of causes of

action is not a ground for dismissal of an action. A misjoined

cause of action may, on motion of a party or on the initiativ

the court, be severed and proceeded with separately.

Sec. 5. Joinder of causes of action. - A party may in one plea

assert, in the alternative or otherwise, as many causes of ac

as he may have against an opposing party, subject to

following conditions:

(a) The party joining the causes of action shall comply withrules on joinder of parties;

(b) The joinder shall not include special civil actions or act

governed by special rules;

(c) Where the causes of action are between the same pa

but pertain to different venues or jurisdictions, the joi

may be allowed in the Regional Trial Court provided on

the causes of action falls within the jurisdiction of said c

and the venue lies therein; and

(d) Where the claims in all the causes of action are princi

for recovery of money, the aggregate amount claimed

be the test of jurisdiction.



Full Text Cases – Cause of Action CIVIL PROCEDU

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G.R. No. L-4606 May 30, 1952

RAMON B. FELIPE, SR., as Chairman, Board of Judges, petitioner,

vs.

HON. JOSE N. LEUTERIO, Judge, Court of First Instance of

Camarines Sur, EMMA IMPERIAL, represented by her guardian-ad-

litem JUSTO V. IMPERIAL, and SOUTHERN LUZON COLLEGE,

respondents.

Ramon Felipe, Jr., and L. B. Karingal for petitioner.

Ezequiel S. Grageda and Victoriano Yamson for respondents Judge

Leuterio and Emma Imperial.

Padilla and San Juan for respondent Southern Luzon College.

BENGZON, J.:

Statement of the case. The issue in the litigation is whether the

courts have the authority to reverse the award of the board of

judges of an oratorical competition.

In an oratorical contest held in Naga, Camarines Sur, first honor was

given by the board of five judges to Nestor Nosce, and second honor

to Emma Imperial. Six days later, Emma asked the court of the firstinstance of that province to reversed that award, alleging that one

of the judges had fallen to error in grading her performance. After a

hearing, and over the objection of the other four judges of the

contest, the court declared Emma Imperial winner of the first place.

Hence this special civil action challenging the court's power to

modify the board's verdict.

The facts. There is no dispute about the facts:

1. On March 12, 1950 a benefit inter-collegiate oratorical contest

was held in Naga City. The contestants were eight, among them

Nestor Nosce, Emma Imperial, and Luis General, Jr.

2. There were five judges of the competition, the petitioner Ramon

B. Felipe, Sr. being the Chairman.

3. After the orators had delivered their respective pieces, and after

the judges had expressed their votes, the Chairman publicly

announced their decision awarding first price to Nestor Nosce,

second price to Emma Imperial, third price to Menandro Benavides

and fourth place to Luis General, Jr.

4. Four days afterwards, Emma Imperial addressed a letter to the

Board of Judges protesting the verdict, and alleging that one of the

Judges had committed a mathematical mistake, resulting in her

second place only, instead of the first, which she therefore claimed.

5. Upon refusal of the Board to amend their award, she filed a

complaint in the court of first instance.

6. At the contest the five judges were each furnished a blank form

wherein he give the participants grades according to his estimate of

their abilities, giving number 1 to the best, number 2 to the second

best etc., down to number 8. Then the grades were added, and the

contestant receiving the lowest number got first prize, the next

second prize, etc.

7. The sums for the first four winners were: Nosce 10; Imperia

Benevides 17, General 17, the Board of judges having vote

follows:

Judge Nosce Imperial Buen

Felipe Sr. ......... 3 1 2

Obias .............. 1 2 4

Rodriguez .......... 1 4 5

Prado .............. 3 2 1

Moll ............... 2 1 5

10 10 17

8. It appearing that Nestor Nosce and Emma Imperial had tied

the first place, the Chairman, apparently with the consent of

board, broke the tie awarding first honors to Nosce and sec

honors to Imperial.

9. For the convenience of the judges the typewritten fo

contained blank spaces in which, after the names of the rival ora

and their respective orations, the judge could not jot down

grades he thought the contestants deserved according

"Originality", "Timeliness", "English", "Stage Persona

"Pronunciation and Enunciation" and "Voice". From such data

made up his vote.

10. It was discovered later that the form filed by Delfin Rodrig

one of the Judges, gave Imperial and General the following rat

under the above headings; Imperial 19-15-15-18-14-14 Total

Place 4th General 19-15-15 or 14-19-14-14 Total 95-Place 3rd.

11. Imperial asserts that her total should be 95 instead of 94

therefore should rank 3rd place in Rodriguez' vote. And if she g

from Rodriguez, her total vote should have been 9 instead of

with the result that she copped first place in the speaking joust.

12. Rodriguez testified that he made a mistake in adding

Imperial's ratings; that she should have been given a total of 95

placed No. 3, the same as General; that he was not dispose

break the tie between her and General and insisted that he wa

to give rank 3 to Imperial and rank 3 also to General.

Discussion. Although it would seem anomalous for one judge to

the same rank to two contestants, we will concede for the mom

that Delfin Rodriguez could have given 3 to Imperial to General.

However if deductions are to be made from his recorded

(Exhibit 3) one may infer that after the contest and besubmitting his vote he decided to give General an edge

Imperial. How? Under the caption "English" General was give

himself at first "14", later increased to "15". Evidently because a

he had added the ratings of Imperial and (erroneously) reached

sum of 94, he added the ratings of General (which were the sam

Imperial with 14 under "English") and (mistakenly) reached 94

So what did he also? He raised the 14 to 15 and thus gave gener

to place him over Imperial's 94. (Mistakingly again, because wit

General got 96 instead of 95).

But to us the important thing is Rodriguez' vote during

immediately after the affair. His vote in Exhibit 3 definitely




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General place No. 3 and Imperial place No. 4. His calculations

recorded on Exhibit 3 were not material. In fact the Chairman did

not bother to fill out the blank spaces in his own form, and merely

set down his conclusions giving one to Imperial, 2 to Benavides etc.

without specifying the ratings for "Voice", "English", "Stage

Personality" etc. In other words what counted was the vote.

Probably for the above reasons the board refused to "correct" the

alleged error.

The situation then is this: Days after a contest has been conducted

and the winners announced, one of the judges confesses he made a

mistake, that the ratings he gave the second place winner should

have been such as would entitle her to first place. The other judges

refuse to alter their verdict. May the matter be brought to the court

to obtain a new award, reversing the decision of the board of

judges?

For more than thirty years oratorical tilts have been held periodically

by schools and colleges in these islands. Inter-collegiate oratorical

competitions are of more recent origin. Members of this court have

taken part in them either as contestants in their school days1, or as

members of the board of judges afterwards. They know some (few)

verdicts did not reflect the audience's preference and that errors

have sometimes been ascribed to the award of the judges. Yet no

party ever presumed to invoke judicial intervention; for it is

unwritten law in such contests that the board's decision is final and

unappealable.

Like the ancient tournaments of the Sword, these tournaments of

the Word apply the highest tenets of sportmanship: finally of the

referee's verdict. No alibis, no murmurs of protest. The participants

are supposed to join the competition to contribute to its success by

striving their utmost: the prizes are secondary.

No rights to the prizes may be asserted by the contestants, because

their's was merely the privilege to compete for the prize, and thatprivilege did not ripen into a demandable right unless and until they

were proclaimed winners of the competition by the appointed

arbiters or referees or judges.

Incidentally, these school activities have been imported from the

United States. We found in American jurisprudence no litigation

questioning the determination of the board of judges.

Now, the fact that a particular action has had no precedent during a

long period affords some reason for doubting the existence of the

right sought to be enforced, especially where occasion for its

assertion must have often arisen; and courts are cautious before

allowing it, being loath to establish a new legal principle not inharmony with the generally accepted views thereon. (See C.J.S. Vol.

1, p. 1012).

We observe that in assuming jurisdiction over the matter, the

respondent judge reasoned out that where there is a wrong there is

a remedy and that courts of first instance are courts of general

jurisdiction.

The flaw in his reasoning lies in the assumption that Imperial

suffered some wrong at the hands of the board of judges. If at all,

there was error on the part of one judge, at most. Error and wrong

do not mean the same thing. "Wrong" as used in the aforesaid legal

principle is the deprivation or violation of a right. As stated befo

contestant has no right to the prize unless and until he or sh

declared winner by the board of referees or judges.

Granting that Imperial suffered some loss or injury, yet in law t

are instances of "damnum absque injuria". This is one of the

fraud or malice had been proven, it would be a diffe

proposition. But then her action should be directed against

individual judge or judges who fraudulently or maliciously inj

her. Not against the other judges.

By the way what is here in stated must not be understoo

applying to those activities which the government has chose

regulate with the creation of the Games and Amusements Boa

Executive Order No. 392, Series 1950.

Judgment . In view of all the foregoing, we are of the opinion an

declare, that the judiciary has no power to reverse the award of

board of judges of an oratorical contest. For that matter it would

interfere in literary contests, beauty contests and sim

competitions.

Wherefore the order in controversy is hereby set aside. No costs




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G.R. No. 175042 April 23, 2012

DANILO A. DU, Petitioner,

vs.

VENANCIO R. JAYOMA, then Municipal Mayor of Mabini, Bohol,

VICENTE GULLE, JR., JOVENIANO MIANO, WILFREDO MENDEZ,

AGAPITO VALLESPIN, RENE BUCIO, JESUS TUTOR, CRESCENCIO

BERNALES, EDGARDO YBANEZ, and REY PAGALAN, then members

of the Sangguniang Bayan (SB) of Mabini, Bohol, Respondents.

D E C I S I O N

DEL CASTILLO, J.:

In the absence of a legal right in favor of the plaintiff, there can be

no cause of action.

This Petition for Review on Certiorar i 1 under Rule 45 of the Rules of

Court assails the Decision2 dated July 11, 2006 and the Resolution

3

dated October 4, 2006 of the Court of Appeals (CA) in CA-G.R. SP No.

00492.

Factual Antecedents

On July 7, 1988, the Sangguniang Bayan of the Municipality of

Mabini, Bohol, enacted Municipal Ordinance No. 1, series of 1988,4

requiring the conduct of a public bidding for the operation of a

cockpit in the said municipality every four years.

For the period January 1, 1989 to December 31, 1992, the winning

bidder was Engr. Edgardo Carabuena.5 However, due to his failure to

comply with the legal requirements for operating a cockpit, the

Sangguniang Bayan on December 1, 1988 adopted Resolution No.

127, series of 1988,6 authorizing petitioner Danilo Du to continue his

cockpit operation until the winning bidder complies with the legal

requirements.7

On July 9, 1997, upon discovering that petitioner has been operating

his cockpit in violation of Municipal Ordinance No. 1, series of 1988,

the Sangguniang Bayan passed Municipal Resolution No. 065, series

of 1997,8 suspending petitioner’s cockpit operation effective upon

approval.9

On July 11, 1997, pursuant to Municipal Resolution No. 065, series of

1997, respondent Venancio R. Jayoma, then Mayor of Mabini, in a

letter,10

ordered petitioner to desist from holding any cockfighting

activity effective immediately.11

Feeling aggrieved, petitioner filed with Branch 51 of the RegionalTrial Court (RTC) of Bohol, a Petition for Prohibition,

12 docketed as

Special Civil Action No. 4, against respondent mayor and nine

members of the Sangguniang Bayan of Mabini, namely: Vicente

Gulle, Jr., Joveniano Miano, Wilfredo Mendez, Agapito Vallespin,

Rene Bucio, Jesus Tutor, Crescencio Bernales, Edgardo Ybanez and

Rey Pagalan. Petitioner prayed that a preliminary injunction and/or

a temporary restraining order be issued to prevent respondents

from suspending his cockpit operation.13

Petitioner claimed that he

has a business permit to operate until December 31, 1997;14

and

that the Municipal Resolution No. 065, series of 1997, was

unlawfully issued as it deprived him of due process.15

In their Answer,16

respondents interposed that under the L

Government Code (LGC) of 1991, the power to authorize and lice

the establishment, operation and maintenance of a cockpit is lod

in the Sangguniang Bayan;17

that respondent mayor, in ordering

suspension of petitioner’s cockpit operation, was merely exerc

his executive power to regulate the establishment of cockpits in

municipality, pursuant to the ordinances and resolutions enacte

the Sangguniang Bayan;18

and that Municipal Resolution No.

series of 1997, does not need to be approved by the Sanggun

Panlalawigan because it is not an ordinance but an expressiosentiments of the Sangguniang Bayan of Mabini.19

On October 22, 1997, a Temporary Restraining Order20

was is

by the RTC enjoining respondents from suspending the coc

operation of petitioner until further orders from the court.21

The Petition for Prohibition was later amended22

to inc

damages, which

the RTC admitted in an Order23

dated January 21, 1998.

Ruling of the Regional Trial Court

On October 5, 2004, the RTC rendered a Decision24

in favo

petitioner, to wit:

WHEREFORE, and on the ground that petitioner was able to p

his case with preponderance of evidence, judgment is he

rendered in favor of the petitioner and against the responde

ordering the respondents jointly and severally to pay the petition

1. The amount of Twenty Thousand Pesos (P20,000.0

the concept of moral damages;

2. The amount of Sixty Thousand Pesos (P60,000.00) in

concept of unearned income considering the unrebutestimony of the petitioner [that] he lost Four Thous

Pesos (P4,000.00) for each of the fifteen (15) Sundays

his cockpit was closed as its operation was ord

suspended by the respondent. By mathema

computation P4,000.00 x 15 amounts to P60,000.00;

3. The amount of Ten Thousand Pesos (P10,000.00

exemplary damages to deter other public officials f

committing similar acts;

4. The amount of Twenty Thousand Pesos (P20,000.0

attorney’s fees, and to pay the cost.

SO ORDERED.25

Ruling of the Court of Appeals

On appeal, the CA reversed the Decision of the RTC. According to

CA, petitioner did not acquire a vested right to operate a cockp

the municipality as he was only granted a temporary privilege by

Sangguniang Bayan.26

Hence, there being no right in esse, petiti

is not entitled to damages.27

Thus, the dispositive portion reads:

WHEREFORE, premises considered, the instant appeal is he

DENIED. The assailed decision granting petitioner the awar

http://www.lawphil.net/judjuris/juri2012/apr2012/gr_175042_2012.html#fnt1















































































































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damages is SET ASIDE and the petition filed by petitioner against

respondents is DISMISSED.

SO ORDERED.28

Petitioner moved for reconsideration which was denied by the CA in

a Resolution29

dated October 4, 2006.

Issue

Hence, the instant petition raising the core issue of whether the CA

erred in finding that petitioner is not entitled to damages.30

Petitioner’s Arguments

Petitioner contends that Municipal Resolution No. 065, series of

1997, is ultra vires as it was maliciously, hastily, and unlawfully

enforced by respondent mayor two days after its passage without

the review or approval of the Sangguniang Panlalawigan of Bohol.31

He alleges that respondents suspended the operation of his cockpit

without due process and that the suspension was politically

motivated.32

In addition, he claims that as a result of the incident, he

is entitled to actual, moral and exemplary damages as well as

attorney’s fees.33

Respondents’ Arguments

Echoing the ruling of the CA, respondents insist that petitioner is not

entitled to damages because he did not acquire a vested right to

operate a cockpit in the municipality.34

They also maintain that the

suspension of petitioner’s cockpit operation was pursuant to law

and prevailing ordinance.35

Our Ruling

The petition lacks merit.

A cause of action is defined as "the act or omission by which a party

violates a right of another."36

Corollarily, the essential elements of a cause of action are: (1) a right

in favor of the plaintiff; (2) an obligation on the part of the

defendant to respect such right; and (3) an act or omission on the

part of the defendant in violation of the plaintiff’s right with a

resulting injury or damage to the plaintiff for which the latter may

file an action for the recovery of damages or other appropriate

relief. 37

Petitioner has no legal right to operate a cockpit.

In this case, we find that petitioner has no cause of action against

the respondents as he has no legal right to operate a cockpit in the

municipality. Under Resolution No. 127, series of 1988, the

Sangguniang Bayan allowed him to continue to operate his cockpit

only because the winning bidder for the period January 1, 1989 to

December 31, 1992 failed to comply with the legal requirements for

operating a cockpit. Clearly, under the said resolution, petitioner’s

authority to operate the cockpit would end on December 31, 1992

or upon compliance by the winning bidder with the legal

requirements for operating a cockpit, whichever comes first. As we

see it, the only reason he was able to continue operating until July

1997 was because the Sangguniang Bayan of Mabini faile

monitor the status of the cockpit in their municipality.

And even if he was able to get a business permit from respond

mayor for the period January 1, 1997 to December 31, 1997, this

not give him a license to operate a cockpit. Under Sec

447(a)(3)(v) of the LGC, it is the Sangguniang Bayan whic

empowered to "authorize and license the establishment, opera

and maintenance of cockpits, and regulate cockfighting

commercial breeding of gamecocks." Considering that no pbidding was conducted for the operation of a cockpit from Jan

1, 1993 to December 31, 1997, petitioner cannot claim that he

duly authorized by the Sangguniang Bayan to operate his cockp

the municipality for the period January 1, 1997 to December

1997. Respondent members of the Sangguniang Bayan, theref

had every reason to suspend the operation of petitioner’s cockp

enacting Municipal Resolution No. 065, series of 1997. As the c

executive of the municipal government, respondent mayor

duty-bound to enforce the suspension of the operation

petitioner’s cockpit pursuant to the said Resolution.

It bears stressing that no evidence was presented to show that u

review by the Sangguniang Panlalawigan of Bohol, the resolu

was declared invalid or that the resolution was issued beyond

powers of the Sangguniang Bayan or mayor. Jurisprud

consistently holds that an ordinance, or in this case a resolutio

"presumed valid in the absence of evidence showing that it is no

accordance with the law."38

Hence, we find no reason to invali

Municipal Resolution No. 065, series of 1997.

License to operate a cockpit is a mere privilege.

In addition, it is well enshrined in our jurisprudence that "a licens

authorizing the operation and exploitation of a cockpit is

property of which the holder may not be deprived without

process of law, but a mere privilege that may be revoked wpublic interests so require."

39 Having said that, petition

allegation that he was deprived of due process has no leg to s

on.

Petitioner not entitled to damages

Without any legal right to operate a cockpit in the municip

petitioner is not entitled to damages. Injury alone does not

petitioner the right to recover damages; he must also have a rig

action for the legal wrong inflicted by the respondents.40

We n

not belabor that "in order that the law will give redress for an

causing damage, there must be damnum et injuria – that act m

be not only hurtful, but wrongful."41

1âwphi1

All told, we find no error on the part of the CA in dismis

petitioner’s case.

WHEREFORE, the petition is hereby DENIED. The assailed Dec

dated July 11, 2006 and the Resolution dated October 4, 2006 of

Court of Appeals in CA-G.R. SP No. 00492 are hereby AFFIRMED.

SO ORDERED.



























































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G.R. No. L-1539 December 3, 1947

MA-AO SUGAR CENTRAL CO., petitioner,

vs.

CONRADO BARRIOS, ET AL., respondents.

Hilado Brothers for petitioner.

Gibbs, Gibbs, Chuidian and Quasha for respondents.

FERIA, J.:

This is a petition for certiorari to set aside the order of the

respondent judge denying the motion to dismiss the complaint of

the other respondents which seek to recover amounts of money due

then from the petitioner before the outbreak of the war, on the

ground that the respondent judge acted without or in excess of the

court's jurisdiction in rendering said order; and for prohibition to

forbid the respondent judge from taking cognizance of the case on

the ground that the respondent judge had no jurisdiction to try and

decide it.

The ground for the motion to dismiss filed by the petitioner is that

the complaint of the respondents does not state facts sufficient to

constitute a cause of action, because the plaintiffs have no right to

demand the payment of the defendants' alleged debts until after the

termination or legal cessation of the moratorium provided No. 32,

the pertinent part of which reads as follows:lawphil.net

III. DEBT MORATORIUM

1. Enforcement of payment of all debts and other

monetary obligations payable within the Philippines,

except debts and other monetary obligations, entered into

in any area after declaration by Presidential Proclamation,that such area has been freed from enemy occupation and

control., is temporarily suspended pending action by the

Commonwealth Government. (41 Off. Gaz., No. 1 p. 56.)

It is plain and were are of the opinion that the complaint filed by the

plaintiff respondent in the court below does not state facts sufficient

to constitute a cause of action. A cause of action is an act or

omission of one party in violation of the legal right or rights of the

other; and its essential elements are legal right of the plaintiff,

correlative obligation of the defendant, and act or omission of the

defendant in violation of said legal right. In the present case the

complaint alleges the legal right of the plaintiffs to be paid the

amount due them from the defendant, as well as the correlative

obligation of the defendant to pay said debts to the plaintiffs when

it becomes due and payable; but not the omission on the part of the

defendant to pay in violation of the legal rights of the plaintiffs to be

paid, because according to the above quoted provision of Executive

Order No. 32, said debts are not yet payable or their payment can

not be enforced until the legal cessation of the moratorium, which is

still in force. As the defendant herein petitioner is not yet in default,

plaintiffs have no cause of action against him.

While the debt moratorium is in force the defendant-petitioner has

no obligation yet to pay the plaintiffs, and the latter can not file a

suit against him in the courts of justice requiring him to recognize his

debts to the plaintiffs and to pay them (after the moratorium) not

only the amount of the indebtedness, but the legal interest the

from the filling of the complaint, the attorney's fees of ten

centum of the amounts due, and the costs of the suits. There i

such action to compel a defendant to acknowledge or recogniz

debt which is not yet payable, distinct and different from the ac

for recovery or payment of a debt already due and payable, aga

the debtor who refuses to pay it. To allow the plaintiffs' action

grant the relief demanded in the complaint, would be to compe

defendant to pay legal interest of the amount claimed from filin

the said complaint, as well as the attorney's fees of 10 per centhe sum due thereon as stipulated, and the costs of the suit, as if

defendants' obligations to the plaintiffs were already payable an

had failed or refused to pay them. Why should the defendan

required to bear the expenses incidental to a suit before he

violated the plaintiffs' right? How could plaintiffs assume that

defendant will not pay his debts when they become payable, and

that reason they have filed this action against defendant?

should not the contrary be presumed, that is, that the debtor

pay his obligation at the proper time, in order to prevent a

preserve its credit, and avoid the expenses incident to a suit, and

payment of legal interest on the amount due and attorney's fees

In the case of Henares vs. Cordova (G.R. No. L-1536), a petitio

prohibition was filed by the petitioner alleging that the lower chad no jurisdiction over the subject matter, which is the collectio

an alleged indebtedness unenforceable under the debt morator

and this Court denied the petition on the ground that Execu

Order No. 25, as amended by Executive Order No. 32, did not h

the effect of divesting the lower court of its jurisdiction to try

hear the case. We did not deem it necessary then to express

opinion on the sufficiency of the complaint, but now we do for

guidance of the courts and legal practitioners, and state that

Executive Order No. 25, as amended by Executive Order No. 32

only suspends the execution of the judgment that the court

render so far as it orders the payment of debts and other mone

obligations, as stated in the resolution in said case but also suspe

the filing of suit in the courts of justice for the enforcement of

payment of debts and other monetary obligations therein refeto, if timely objection is set up by the defendant debtor. It is to

borne in mind that the debt moratorium is a right granted by la

the debtors, and as such right it may be waived because its wa

does not effect the public interest or the rights of third parties.

After stating our opinion that the complaint of the plain

respondents states no cause of action, we have to hold that

facts stated in the petition for certiorari and prohibition filed in

present case do not entitle the petitioner to said reliefs. It requ

no argument to show that the respondent judge had jurisdiction

did not exceed it or act with grave abuse of discretion in denying

petitioner's motion to dismiss, and therefore we have to dismiss

present petition. This Court, in special civil actions of certiorari

prohibition, can only determine the question whether or not

court acted without or in excess of its jurisdiction or with g

abuse of its discretion in doing the act complained of. We can

correct errors committed by the lower courts in their judgme

decrees or orders rendered in the exercise of their jurisdiction.

In view of the foregoing, the petition is denied.




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G.R. No. L-4845 December 24, 1952

L. G. MARQUEZ and Z. GUTIERREZ LORA, plaintiffs.

L. G. Marquez, plaintiff-appellant,

vs.

FRANCISCO VARELA and CARMEN VARELA, defendants-appellees.

Amelito R. Mutuc for appellant

Jorge V. Jazmines for appellees.

LABRADOR, J.:

This is an appeal against an order of the Court of First Instance of

manila dismissing the complaint as to plaintiff L.G. Marquez. The

pertinent allegations of the complaint are as follows : that plaintiff

Gutierrez Lora was authorized by defendants to negotiate the sale of

their share or interest in a parcel of land on Plaza Goiti, Manila, and

having meet his co-plaintiff L. G. Marquez, a real estate broker, both

of them agreed to work together for the sale of defendant's

property; that they found a ready, willing, and able buyer, which

accepted defendants' price and terms, but that thereafterdefendants, without any justifiable reason, refused to carry out the

sale and execute the necessary deed therefor; and that as a

consequence plaintiffs failed to receive the commission which they

were entitled to receive. The defendants presented a motion to

dismiss the complaint as to L. G . Marquez on the ground that he has

no cause of action against defendants , and this motion having been

granted, plaintiff L. G. Marquez has prosecuted this appeal.

The complaint was dismissed on the alleged ground that it states no

cause of action against the defendants. Is this objection to the

complaint justified? The term "cause of action" has been held to be

synonymous with "right of action" (37 Words and Phrases, 642), but

in the law of pleading (Code Pleading) one is distinguished from the

other in that a right of action is a remedial right belonging to some

person, while a cause of action is a formal statement of the

operative facts that give rise to such remedial right. The one is a

matter of right and depends on the substantive law, while the other

is a matter of statement and is governed by the law of procedure.

(Phillips, Code Pleading, section 189, page 170.)

It is not denied that Lora, if he rendered the service alleged in the

complaint, would have a right to be paid compensation for the

service he rendered jointly with Marquez. He acted as a broker, and

a broker is entitled to a commission for his services. (Article 277,

Code of Commerce: Henry vs. Velasco, 34 Phil. 587; Perez de Tagle

vs. Luzon Surety Co, 38 Off. Gaz. 1213). There is no prohibition in law

against the employment of a companion to look for a buyer; neitheris it against public policy. Neither was there even any implied

understanding between Lora and the defendants that no part of the

compensation to which Lora would be entitled to receive could be

paid to any companion or helper of Lora. Marquez's right to

compensation can not, therefore, be disputed under the operative

facts set forth in the complaint.

The next issue is, is there a cause of action in favor of Marquez

against the defendants? From the facts alleged in the complaint, it is

clear that there is a primary right in favor of Marquez (to be paid for

his services even through Lora only) and a corresponding duty

devolving upon the defendants (to pay for said services). Since (as

alleged) defendants refuse to comply with their duty, Marquez

is entitled to enforce his legal right by an action in court.

complaint in the case at bar, therefore, contains both the prim

right and duty and the delict or wrong combined which const

the cause of action in the legal sense as used in Code Plea

(Pomeroy, Code Remedies, section 347), and the cause of actio

full and complete.

Objection to the complaint, however, is not that Marquez ha

right to share in the compensation to be paid Lora, wdefendants had directly engaged, but that Marquez can not jo

this action and enforce therein his rights directly against

defendants, evidently because defendants never dealt

Marquez, directly or indirectly, or, in other words, that

Marquez and his services were not known to dismiss show that

in fact was the objection:

This paragraph clearly shows that the authority to sell

only given to plaintiff Z. Gutierrez Lora and not to

other plaintiff L. G. Marquez. Attention is respect

called to the word "plaintiff" used in said paragraph III

expressed in singular form to the exclusion of the o

plaintiff L. G. Marquez. If the plaintiff L. G. Marquez

worked at all for the sale of the property at the instanc

an invitation of his co- plaintiff Z. Gutierrez Lora,

maintain that his action if there is any is against his

plaintiff and not against the defendants herein.

As far as the defendant are concerned in this case, plai

L. G. Marquez is not only a stranger in this case but

unknown to the defendants; and if he had worked at a

the sale of the defendants' share and participation in

parcels of lands referred to in the complaint, the same

made not only at his own look-out, risk and responsib

but also with no authority whatsoever. (Record on App

pages 16, 17)

The principle underlying defendants' objection is one of substan

law, recognized under common law, where no one could sue f

breach of a contract who was not a party thereto, and the ac

allowed to be brought only in the name of the one holding the

title. The requirement was based upon the doctrine of privit

contract.

Sec. 234. Plaintiffs in Action ex Contractu. — Whe

action of contract concerns only the original parties to

instrument, it is not difficult to determine who shoul

the plaintiff. Obviously the one seeking to enforce it is

real party in interest. At common law no one could sue

the breach of contract who was not a party thereto. He

an action on contract, whether express or implied,

required to be brought in the name of the one who

the legal interest. This requirement was based upon

doctrine of privity of contract. . . . (Phillips, Code Plead

page 226.)

Sec. 235. Privity of Contract . — When necessary . — It

a rule of the common law that before one may comp

of another for breach of contract, there must be s

direct contractual relation, or privity, between them;

this, with only a few exceptions, is a requirement of

law today. . . . (Phillips, code Pleading, page 227.)




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At common law, in order that two or more persons may

join in an action upon a contract, there must be

community of interest between them; that is, they must

be parties to the contract and jointly interested in therein.

(47 . C. J. 54)lawphil.net

Persons subsequently admitted to the benefit of a

contract, without the privity or assent of the promisor, can

not join in a suit on the contract. (47 C.J., 55)

But we did not import into this jurisdiction the common law

procedure. Our original code of civil Procedure (Act 190) was taken

mainly from the code of Civil Procedure of California, and this in turn

was based upon the Code of Civil procedure of New York adopted in

that stated in 1948. Our system of pleading is Code Pleading that

system used in the states of the Union that had adopted codes of

procedure. The code system of pleading adopted in substance the

rules of equity practice as to parties, under which "all persons having

an interest in the subject of the action, and in obtaining the relief

demanded, may be joined as plaintiffs". (Phillips, Code Pleading,

section 251, page 247.) In New York and California interest in the

subject matter, or in any relief growing out of the same transaction

or series of transactions is sufficient to allow joinder. (Ibid , footnote

10a. page 247.)

Under the former Code of civil procedure "every action must be

prosecuted in the name of the real party in interest," and "all

persons having an interest in the subject of the action and in

obtaining the relief demanded shall be joined as plaintiffs, " and " if

any person having an interest and in obtaining the relief demanded

refuses to join as plaintiff, he may be made a defendant and the fact

of his interest and refusal to join to be stated in the complaint." (

Section 114, Act 190) The principle underlying the rule is that all

persons having a material interest under the substantive law should

be made parties, as distinguished from that of the common law

which allowed only a two-sided controversy, each party to be

opposed to the other. Phillips, Code Pleading, 2d ed. section 228,page 216.)

The above principles have not been changed by the reforms in the

rules in 1940 and 1941. The action is still to be prosecuted in the

name of the real party in interest. Under section 6 of Rule 3, "All

persons in whom . . . any right to relief in respect to or arising out of

the same transaction . . . is alleged to exist, whether jointly,

severally, or in the alternative, may, . . . join as plaintiffs . . . where

any question of law or fact common to all such plaintiffs . . . may

arise in the action; Plaintiff Marquez, in the case at bar, clearly falls

under the above rule. He is entitled to be paid his commission out of

the very contract of agency between Lora and the defendants; Lora

and he acted jointly in rendering services to defendants under Lora's

contract, and the same questions of law and fact govern theirclaims. The rules do not require the existence of privity of contract

between Marquez and the defendants as required under the

common law; all that they demand is that Marquez has a material

interest in the subject of the action, the right to share in the broker's

commission to be paid Lora under the latter's contract, which right

Lora does not deny. This is sufficient to justify the joinder of

Marquez as a party plaintiff, even in the absence of privity of

contract between him and the defendants.

We find, therefore, that the complaint of Marquez was improperly

dismissed. The order of dismissal is hereby reversed, with costs

against defendants.




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G.R. No. L-19751 February 28, 1966

ALFREDO REMITERE, ET AL., plaintiff-appellants,

vs.

REMEDIOS MONTINOLA VDA. DE YULO, ET AL., defendants-

appellees.

E.M. Almario for the plaintiffs-appellants.

Eduardo Arboleda for the defendants-appellees.

ZALDIVAR, J.:

This is an appeal from the order of the Court of First Instance of

Negros Occidental dismissing the complaint in its Civil Case No.

6377.

On December 6, 1961 the plaintiffs-appellants, Alfredo Remitere, et

al., filed a complaint against the defendants-appellees, Remedies

Montinola Viuda de Yulo and the Register of Deeds of Negros

Occidental, the pertinent allegations of which complaint, for the

purposes of this decision, are as follows:

2. In Cadastral Decrees Nos. 69518 and 69515 issued by

the Court of First Instance of Negros Occidental on August

21, 1918, copies of which are herewith attached as

Annexes "A" and "B" and made an integral part of this

complaint, Gregorio Remitere was declared and registered

owner of Lots Nos. 35 and 52 of the Cadastral Survey of

Isabela, with areas of 4.4731 and 29.7398 hectares,

respectively. These lots were issued the corresponding

Original Certificates of Title under the Land Registration

Act, being 10894 and 10898.

3. Upon the demise of Gregorio Remitere on January 1,

1914, the Court of First Instance of Negros Occidental, in

Civil Case No. 1661, Re-Application for Letters ofAdministration, appointed his wife as administratrix of his

estate, among which are the two lots in question.

During this period, the provincial sheriff of Negros

Occidental conducted a public auction sale over the said

parcels of land, and on the same day, September 23, 1918,

he issued thereof a deed of sale in favor of Mariano Yulo

of Binalbagan, Negros Occidental, for the total

consideration of P20,000.00. Copy of the deed of sale is

herewith attached as Annex "C" and formed part of this

complaint.

4. As a result, series of cancellations to the Original

Certificates of Title mentioned in paragraph 2 hereof had

followed.

First, they were cancelled by Transfer Certificates of Title Nos. 2819

and 2820, registered in the name of Mariano C. Yulo by virtue of the

Certificates of Sale issued by the provincial sheriff of Negros

Occidental. They were in turn cancelled by R-T 602 and R-T 4706, by

virtue of reconstitution of titles. Then these were cancelled by T-532

and T-2979, by virtue of deeds of sales registered in the name of

Remedios Montinola Vda. de Yulo, the defendant herein..

5. The public sale mentioned in Article 3 of this compl

however, was and still is absolutely a void sale,

certainly did not pass titles and ownership of said

starting from its primitive owner, now being represe

by the plaintiffs herein, as surviving heirs thereto, un

reaches the possession by the defendant.

That by reason of its invalidity, all and every benefits

the transferees, including the defendant herein,

acquired from the parcels of land in question, shoulindemnified to the plaintiffs.

And that, in order to justify their rights and inte

pursuant to the mandates prescribed by law over said

and discontinue the irreparable losses and damages

they are still sustaining, on account of the perve

transfer of September 23, 1918, the same should

reverted to their immediate possessions and titles.

The complaint prayed that the defendants be ordered to reco

the two lots in question to the plaintiffs; that the defendant Reg

of Deeds be ordered to cancel the certificates of title in the nam

the defendant Remedios Montinola Viuda de Yulo and to issue

ones in the names of the plaintiffs; and that the defendants pay

costs.

The defendants-appellees filed a motion to dismiss the complain

the grounds (1) that the complaint does not state a cause of ac

and (2) that even assuming that a cause of action exists, the s

has already prescribed.

The lower court dismissed the complaint precisely on the grou

relied upon by the defendants-appellees. Hence this appeal.

In this appeal, the plaintiffs-appellants contend that the trial c

erred: (1) in declaring that the complaint contains no narratio

facts; (2) in holding that complaint states no cause of action; and

in holding that the plaintiffs' cause of action, if any, has alr

prescribed.

We find that the lower court had correctly dismissed

complaint.1äwphï1.ñët

The lack of a cause of action as a ground for dismissal must ap

on the face of the complaint, and to determine whether

complaint states a cause of action only the facts alleged therein,

no other, should be considered. A reading of the complaint in

case will readily impress one that no ultimate facts which

constitute the basis of plaintiffs-appellants rights which had b

violated are alleged. Neither are there allegations of ultimate fshowing acts or omissions on the part of the defendants-appe

which constitute a violation of the rights of plaintiffs-appella

Apparently, the plaintiffs-appellants rely on the allegation

paragraphs 3 and 5 of the complaint for their cause of ac

Paragraph 3 states:

3. Upon the demise of Gregorio Remitere on Janua

1914 the Court of First Instance of Negros Occidenta

Civil Case No. 1661, Re-Application for Letters

Administration, appointed his wife as administratrix o

estate, among which the two lots in question.




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During this period, the provincial sheriff of Negros

Occidental, conducted a public auction sale over the said

parcels of land, and on the same day, September 23, 1918,

he issued thereof a deed of sale in favor of Mariano Yulo

of Binalbagan, Negros Occidental, for the total

consideration of P20,000.00. . . . .

The allegations embodied in the above quoted paragraph are mere

averments or recitals of facts that do not establish any right or claim

on the part of the plaintiffs. The allegations do not state anyconnection that the plaintiffs have with the deceased Gregorio

Remitere, nor do they state what connection or claim the plaintiffs

have on the properties left by the deceased Gregorio Remitere. The

allegation about the sale at public auction does not state in what

way the rights or interests of the plaintiffs had been affected, nay

prejudiced, by that sale. Again, paragraph 5 of the complaint states:

5. The public sale mentioned in paragraph 3 of this

complaint, however, was and still is absolutely a void sale,

and certainly did not pass titles and ownership of said lots,

starting from its primitive owner, now being represented

by the plaintiffs herein, as surviving heirs thereto, until it

reaches the possession by the defendants.

That by reason of its invalidity, all and every benefits that

the transferees, including the defendant herein, had

acquired from the parcels of land in question, should be

indemnified to the plaintiffs.

It is not stated anywhere in the complaint why the sale at public

auction was absolutely void, nor were there stated any particular

facts or circumstances upon which the alleged nullity of the sale or

transaction is predicated. The averment that "the public sale . . . was

and still is absolutely a void sale, and certainly did not pass titles and

ownerships of said lots, starting from its primitive owner, now being

represented by the plaintiffs herein, as surviving heirs thereto, until

it reaches the possession by the defendants. . ." is a conclusion oflaw or an inference from facts not stated in the pleading. A pleading

should state the ultimate facts essential to the rights of action or

defense asserted, as distinguished from mere conclusion of fact, or

conclusion of law. An allegation that a contract is valid, or void, as in

the instant case, is a mere conclusion of law.

General allegations that a contract is valid or legal, or is

just, fair and reasonable, are mere conclusion of law.

Likewise, allegations that a contract is void, voidable,

invalid, illegal, ultra vires, or against public policy, without

stating facts showing its invalidity, are mere conclusions of

law; as are allegations that a contract is in conformity

with, or in violation of a constitutional or statutory

provision. . . . . (71 C.J.S. pp. 44-45.) (Emphasis supplied.)

Not being statements of ultimate facts which constitute the basis of

a right of the plaintiffs-appellants, nor are they statements of

ultimate facts which constitute the wrongful acts or omissions of the

defendants-appellees that violated the right of the plaintiffs-

appellants the allegations of the complaint in the present case have

not fulfilled the requirements of Section 3, Rule 6 of the Revised

Rules of Court (Sec. 1, Rule 6 of the former Rules of Court) that the

complaint should contain a "concise statement of the ultimate facts

constituting the plaintiff's cause or causes of action."

This Court has defined the term "cause of action" as follows:

A cause of action has been defined by the Supreme C

as an act or omission of one party in violation of the

right or rights of the other; and its essential elements

legal right of the plaintiff, correlative obligations of

defendant, and act or omission of the defendan

violation of said legal right. (Ma-ao Sugar Central Co.,

vs. Barrios, et al., L-1539, Dec. 30, 1947)

The term "ultimate facts" has been defined or explained as follow

Ultimate facts defined .—The term "ultimate facts" as

in Sec. 3, Rule 3 of the Rules of Court, means the esse

facts constituting the plaintiff's cause of action. A fa

essential if it cannot be stricken out without leaving

statement of the cause of action insufficient. . . . . (Mo

Rules of Court, Vol. I, 1963 ed., p. 213)

Ultimate facts are important and substantial facts w

either directly form the basis of the primary right and d

or which directly make up the wrongful acts or omiss

of the defendant. The term does not refer to the detaiprobative matter or particulars of evidence by which t

material elements are to be established. It refer

principal determinate, constitutive facts, upon

existence of which, the entire cause of action r

(Montemayor vs. Raborar, et al., 53 O.G. No. 19, p. 6

citing Pomeroy, Code Remedies, 5th Ed., sec. 420).

We, therefore, hold that the lower court had correctly ruled that

complaint in the present case does not narrate facts that consti

a cause of action.

Having arrived at the foregoing conclusion, We deem it

necessary to discuss whether the lower court had correctly r

that the plaintiffs' cause of action, if any, had prescribed or not.

Wherefore, the order of dismissal appealed from is affirmed,

costs against the plaintiffs-appellants.




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G.R. No. 129928 August 25, 2005

MISAMIS OCCIDENTAL II COOPERATIVE, INC., Petitioners,

vs.

VIRGILIO S. DAVID, Respondent.

D E C I S I O N

Tinga, J .:

In this Petition for Review 1 under Rule 45 of the 1997 Rules of Civil

Procedure, petitioner Misamis Occidental II Electric Cooperative, Inc.

(hereinafter, MOELCI II) seeks the reversal of the Decision2 of the

Court of Appeals, Former Ninth Division in C.A. G.R. SP No. 41626

and its Resolution3 denying MOELCI II’s motion for reconsideration.

The questioned Decision dismissed MOELCI II’s petition for certiorari

under Rule 65 and effectively affirmed the trial court’s orders dated

16 November 19954 and 13 March 1996

5 which respectively denied

petitioner’s Motion (For Preliminary Hearing of Affirmative Defenses

and Deferment of Pre-Trial Conference)6 and Motion for

Reconsideration.7

The antecedents are as follows:

Private respondent Virgilio S. David (hereinafter, David), a supplier

of electrical hardware,8 filed a case for specific performance and

damages against MOELCI II, a rural electric cooperative in Misamis

Occidental, docketed as Civil Case No. 94-69402 entitled "Virgilio

David v. Misamis Occidental II Electric Cooperative, Inc. (MOELCI II)."

The said case, which was essentially a collection suit, pending before

Judge Felixberto Olalia (hereinafter, Judge Olalia) of the Regional

Trial Court of Manila, Branch 8 (the trial court), was predicated on a

document attached as Annex "A" to the Amended Complaint 9 that

according to David is the contract pursuant to which he sold to

MOELCI II one (1) unit of 10 MVA Transformer.10

MOELCI II filed its Answer to Amended Complaint 11

which pleaded,

among others, affirmative defenses which also constitute grounds

for dismissal of the complaint. These grounds were lack of cause of

action, there being allegedly no enforceable contract between David

and MOELCI II under the Statute of Frauds pursuant to Section 1 (g)

and (i), Rule 16 of the Rules of Court, and improper venue.12

In accordance with Section 5, Rule 16 of the Rules of Court,13

(now

Section 6, Rule 16 of the 1997 Rules of Civil Procedure) MOELCI II

filed with the trial court a Motion (For Preliminary Hearing of

Affirmative Defenses and Deferment of Pre-Trial Conference )14

(hereinafter referred to as Motion). In said Motion, MOELCI II in

essence argued that the document attached as Annex "A" to the

Amended Complaint was only a quotation letter and not a contractas alleged by David. Thus, it contends that David’s Amended

Complaint is dismissible for failure to state a cause of action.15

In his opposition to MOELCI II’s Motion, David contended in the

main that because a motion to dismiss on the ground of failure to

state a cause of action is required to be based only on the

allegations of the complaint, the "quotation letter," being merely an

attachment to the complaint and not part of its allegations, cannot

be inquired into.16

MOELCI II filed a rejoinder to the opposition in which it asserted,

citing extensively the ruling of the Court in World Wide Insurance &

Surety Co., Inc. v. Macrohon ,17

that a complaint cannot be separ

from its annexes; hence, the trial court in resolving a motio

dismiss on the ground of failure to state a cause of action m

consider the complaint’s annexes.18

After the parties filed their respective memoranda, Judge O

issued an order dated 16 November 1995 denying MOELCI

motion for preliminary hearing of affirmative defenses. MOELC

motion for reconsideration of the said order was likewise denie

another order issued by Judge Olalia on 13 March 1996.19

MOELCI II elevated this incident to the Court of Appeals by way

special civil action for certiorari, alleging grave abuse of discre

on the part of Judge Olalia in the issuance of the two afore

orders.

On 14 March 1997, the Court of Appeals dismissed MOELC

petition holding that the allegations in David’s complaint consti

a cause of action. With regard to MOELCI II’s contention that Da

Amended Complaint is dismissible as the document, attac

thereto as Annex "A," upon which David’s claim is based is n

contract of sale but rather a quotation letter, the Court of App

ruled that the interpretation of the document requires evide

aliunde which is not allowed in determining whether or not

complaint states a cause of action. The appellate court fur

declared that when the trial court is confronted with a motio

dismiss on the ground of lack of cause of action, it is mandate

confine its examination for the resolution thereof to the allegat

of the complaint and is specifically enjoined from receiving evide

for that purpose.20

With the denial of its Motion for Reconsideration, petitioner is

before this Court seeking a review of the appellate co

pronouncements. MOELCI II asserts that the Court of App

committed serious error in: (1) ruling that the resolution o

motion to dismiss on the ground of lack of cause of ac

necessitated hearings by the trial court with the end in viewdetermining whether or not the document attached as Annex "A

the Amended Complaint is a contract as alleged in the body of

pleading; and (2) not ordering the trial court to dismiss the Amen

Complaint on the ground of lack of cause of action.21

Anent the

ground, MOELCI II further claims that with the denial of its Peti

the appellate court in effect exhorted the trial court to defer

resolution of its motion to dismiss until after the hearing of the

on the merits contrary to Rule 1622

of the Rules of Court and w

settled jurisprudence.23

In his comment,24

David counters that a sufficient cause of ac

exists. He also points out that he and MOELCI II differ in

interpretation of the construction of the document attache

Annex "A" of the Amended Complaint ; hence, there is a nee

conduct hearings thereon. He likewise contends that the trial c

did not defer the resolution of petitioner’s motion to dismiss. On

contrary, the trial court denied squarely the motion "to abbrev

the proceedings and for the parties to proceed to trial and a

piece meal resolution of issues."25

In its Reply ,26

MOELCI II reiterates its position that the docum

attached as Annex "A" of the Amended Complaint clearly

quotation letter and not a perfected contract of sale as allege

David. The absence of doubt or ambiguity of the contents

import of the document leaves no room for its interpretation.

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At issue is whether the Court of Appeals erred in dismissing the

petition for certiorari and in holding that the trial court did not

commit grave abuse of discretion in denying petitioner’s Motion.

We find no error in the ruling of the Court of Appeals.

In Municipality of Biñan, Laguna v. Court of Appeals ,27

decided under

the old Rules of Court, we held that a preliminary hearing permitted

under Section 5, Rule 16, is not mandatory even when the same is

prayed for. It rests largely on the sound discretion of the court, thus:

SEC. 5. Pleading grounds as affirmative defenses.- Any of the

grounds for dismissal provided for in this rule, except improper

venue, may be pleaded as an affirmative defense, and a preliminary

hearing may be had thereon as if a motion to dismiss had been filed.

The use of the word "may" in the aforequoted provision shows that

such a hearing is not mandatory but discretionary. It is an auxiliary

verb indicating liberty, opportunity, permission and possibility.28

Such interpretation is now specifically expressed in the 1997 Rules

of Civil Procedure. Section 6, Rule 16 provides that a grant of

preliminary hearing rests on the sound discretion of the court, towit-

SEC. 6. Pleading grounds as affirmative defenses.- If no motion to

dismiss has been filed, any of the grounds for dismissal provided for

in this Rule may be pleaded as an affirmative defense in the answer

and, in the discretion of the court, a preliminary hearing may be had

thereon as if a motion to dismiss had been filed. …

Based on the foregoing, a preliminary hearing undeniably is subject

to the discretion of the trial court. Absent any showing that the trial

court had acted without jurisdiction or in excess thereof or with

such grave abuse of discretion as would amount to lack of

jurisdiction, as in the present case, the trial court’s order granting ordispensing with the need for a preliminary hearing may not be

corrected by certiorari.29

Moreover, consistent with our ruling in The Heirs of Juliana Clavano

v. Genato ,30

as MOELCI II’s Motion is anchored on the ground that

the Complaint allegedly stated no cause of action, a preliminary

hearing thereon is more than unnecessary as it constitutes an

erroneous and improvident move. No error therefore could be

ascribed to the trial court in the denial of such Motion. The Court

ruled in the cited case, thus:

. . . . respondent Judge committed an error in conducting a

preliminary hearing on the private respondent’s affirmative

defenses. It is a well-settled rule that in a motion to dismiss based

on the ground that the complaint fails to state a cause of action, the

question submitted to the court for determination is the sufficiency

of the allegations in the complaint itself. Whether those allegations

are true or not is beside the point, for their truth is hypothetically

admitted by the motion. The issue rather is: admitting them to be

true, may the court render a valid judgment in accordance with the

prayer of the complaint? Stated otherwise, the sufficiency of the

cause of action must appear on the face of the complaint in order to

sustain a dismissal on this ground. No extraneous matter may be

considered nor facts not alleged, which would require evidence and

therefore must be raised as defenses and await the trial. In other

words, to determine the sufficiency of the cause of action, only

facts alleged in the complaint, and no other should be considered

The respondent Judge departed from this rule in conductin

hearing and in receiving evidence in support of the pri

respondent’s affirmative defense, that is, lack of cause of action.

To determine the existence of a cause of action, only the statem

in the complaint may be properly considered. It is error for the c

to take cognizance of external facts or hold preliminary hearingdetermine their existence. If the allegations in a complaint fur

sufficient basis by which the complaint can be maintained, the s

should not be dismissed regardless of the defenses that may

averred by the defendants.32

The test of sufficiency of facts alleged in the complaint

constituting a cause of action is whether or not admitting the f

alleged, the court could render a valid verdict in accordance with

prayer of said complaint.33

In the case at bar, the Amended Complaint states in paragraphs

5, and 6, thus:

FIRST CAUSE OF ACTION

3. On June 8 1992 the parties entered into a contract for the sa

the plaintiff to the defendant of one (1) unit 10 MVA Po

transformer with accessories for a total price of P5,200,000.00

69 KV Line Accessories for a total price of P2,169,500.00 under

following relevant terms and conditions:

1. Fifty percent (50%) downpayment upon signing of contract.

Fifty percent (50%) upon delivery

2. Delivery- Ninety (90) working days upon receipt of your Purc

Order and Downpayment

Copy of the contract is hereto attached as Annex "A."

4. Because of the standing relationship between the parties and

urgent need on the part of the defendant for the power transfo

to remedy the electric supply deficiency in its area of coverage

plaintiff waived the 50% downpayment and delivered s

thereafter the 10 MVA transformer with accessories evidence

by a copy of the sales invoice hereto attached as Annex "B".

5. Despite demands however, verbal and written, since Decem

1992, the defendant has failed to pay the price thereoP5,200,000.00 plus the custom duties and incidental expense

P272,722.27.

SECOND CAUSE OF ACTION

6. Apart from the above transaction, the plaintiff has been,

regular basis, delivering various electrical hardware to the defen

which, as of 31 January 1994, despite demands, has an outstan

balance of P281,939.76.34

And David prayed as follows:


































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WHEREFORE, it is respectfully prayed that judgment render ordering

the defendant to pay the plaintiff:

ON THE FIRST CAUSE OF ACTION

1. The total sum of P5,472,722.27 plus the stipulated interest at 24%

per annum from December 1992 until fully paid.

ON THE SECOND CAUSE OF ACTION

2. The balance of P281,939.76 plus the stipulated interest at 24% per

annum from due dates until fully paid.

COMMON PROPER (sic)

3. Attorney’s fee at 25% of the foregoing amounts plus expenses of

litigation and not less than P100,000.00 with costs.

4. Other reliefs as may be just and equitable in the premises .35

It has been hypothetically admitted that the parties had entered into

a contract sale David bound himself to supply MOELCI II (1) unit 10MVA Power transformer with accessories for a total price of

P5,200,000.00 plus 69 KV Line Accessories for a total price of

P2,169,500.00; that despite written and verbal demands, MOELCI II

has failed to pay the price thereof plus the custom duties and

incidental expenses of P272,722.27; and that apart from the

previously stated contract of sale, David regularly delivered various

electrical hardware to MOELCI II which, despite demands, has an

outstanding balance of P281,939.76.

We believe all the foregoing sufficiently lay out a cause of action.

Even extending our scrutiny to Annex "A," which is after all deemed

a part of the Amended Complaint , will not result to a change in our

conclusion.

Contrary to MOELCI II’s assertion, Annex "A" is not an "undisguised

quotation letter."36

While Annex "A" is captioned as such, the

presence of the signatures of both the General Manager and the

Chairman of the Committee of Management immediately below the

word "CONFORME" appearing on the document’s last page37

lends

credulity to David’s contention that there was, or might have been, a

meeting of minds on the terms embodied therein. Thus, the

appendage of Annex "A" does not entirely serve to snuff ou t David’s

claims.

In fact, the ambiguity of the import and nature of Annex "A" which

necessitates a resort to its proper interpretation, fortifies the

propriety of the trial court’s

denial of MOELCI II’s Motion. The interpretation of a document

requires introduction of evidence which is precisely disallowed in

determining whether or not a complaint states a cause of action.

The Court of Appeals therefore correctly dismissed MOELCI II’s

petition and upheld the trial court’s ruling.

Now, whether in truth Annex "A" is, as entitled, a mere quotation

letter is a matter that could best be proven during a full-blown

hearing rather than through a preliminary hearing as this may

involve extensive proof. Verily, where a preliminary hearing will not

suffice, it is incumbent upon the trial court to deny a motion for

preliminary hearing and go on to trial. The veracity of the assert

of the parties can be ascertained at the trial of the case on

merits.38

Finally, we do not agree with MOELCI II’s contention that the C

of Appeals sanctioned the trial court’s deferment of the resolu

of MOELCI II’s Motion. The trial court squarely denied the Mo

and not merely deferred its resolution.39

Thus, there is no deferm

to speak of that should be enjoined.

WHEREFORE, the instant petition is DENIED. The Decision of

Court of Appeals dated 14 March 1997 and its Resolution date

July 1997 are AFFIRMED. Costs against petitioner.

SO ORDERED.























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G.R. No. 147593 July 31, 2006

GERONIMO Q. QUADRA, petitioner,

vs.

THE COURT OF APPEALS and the PHILIPPINE CHARITY

SWEEPSTAKES OFFICE, respondents.

D E C I S I O N

PUNO, J .:

This is a petition for review of the decision of the Court of Appeals in

CA-G.R. SP No. 55634 dated December 29, 2000 and its resolution

dated March 26, 2001. The Court of Appeals reversed and set aside

the decision of the National Labor Relations Commission (NLRC) in

NLRC NCR Case No. 4312-ULP which affirmed the decision of the

Labor Arbiter granting moral and exemplary damages to petitioner

Geronimo Q. Quadra in connection with his dismissal from the

service.

Petitioner Geronimo Q. Quadra was the Chief Legal Officer of

respondent Philippine Charity Sweepstakes Office (PCSO) when he

organized and actively participated in the activities of PhilippineCharity Sweepstakes Employees Association (CUGCO), an

organization composed of the rank and file employees of PCSO, and

then later, the Association of Sweepstakes Staff Personnel and

Supervisors (CUGCO) (ASSPS [CUGCO]). In April 1964, he was

administratively charged before the Civil Service Commission with

violation of Civil Service Law and Rules for neglect of duty and

misconduct and/or conduct prejudicial to the interest of the service.

On July 14, 1965, the Civil Service Commission rendered a decision

finding petitioner guilty of the charges and recommending the

penalty of dismissal. The following day, on July 15, 1965, the General

Manager of PCSO, Ignacio Santos Diaz, sent petitioner a letter of

dismissal, in accordance with the decision of the Civil Service

Commission. Petitioner filed a motion for reconsideration of the

decision of the Civil Service Commission on August 10, 1965. At thesame time, petitioner, together with ASSPS (CUGCO), filed with the

Court of Industrial Relations (CIR) a complaint for unfair labor

practice against respondent PCSO and its officers. The case was

docketed as Case No. 4312-ULP.

On November 19, 1966, the CIR issued its decision finding

respondent PCSO guilty of unfair labor practice for having

committed discrimination against the union and for having

dismissed petitioner due to his union activities. It ordered the

reinstatement of petitioner to his former position with full

backwages and with all the rights and privileges pertaining to said

position.1

Respondent PCSO complied with the decision of the CIR. But while it

reinstated petitioner to his former position and paid his backwages,

it also filed with the Supreme Court a petition for review on

certiorari entitled "Philippine Charity Sweepstakes Office, et al. v.


decision of the CIR in Case No. 4312-ULP. The petition was docketed

as G.R. No. L-27546.2

On March 16, 1967, during the pendency of the case in the Supreme

Court, petitioner filed with the CIR a "Petition for Damages." He

prayed for moral and exemplary damages in connection with Case

No. 4312-ULP. He cited the decision of the Supreme Court in Rheem

of the Philippines, Inc., et al. v. Ferrer, et al.3 where it upheld

jurisdiction of the CIR over claims for damages incidental to

employee's dismissal.

Respondent PCSO moved to dismiss the petition for damages on

following grounds: (1) the CIR has no jurisdiction to award mora

exemplary damages; (2) the cause of action is barred by p

judgment, it appearing that two complaints are brought for diffe

parts of a single cause of action; and (3) the petition states no v

cause of action.

Petitioner resigned from PCSO on August 18, 1967.

The petition for damages and the motion to dismiss, howe

remained pending with the CIR until it was abolished and the N

was created. On April 25, 1980, the Labor Arbiter rendere

decision awarding moral and exemplary damages to petitioner in

amount of P1.6 million. The dispositive portion of the deci

stated:

WHEREFORE, in view of all the foregoing considerat

judgment is hereby rendered awarding to complai

Geronimo Q. Quadra moral damages consisting offollowing sum: Three Hundred Fifty Thousand P

(P350,000.00) for besmirched reputation; Three Hun

Fifty Thousand Pesos (P350,000.00) for social humilia

One Hundred Thousand Pesos (P100,000.00) for me

anguish; One Hundred Thousand Pesos (P100,000.00

serious anxiety; One Hundred Thousand P

(P100,000.00) for wounded feelings; One Hun

Thousand Pesos (P100,000.00) for moral shock; and

further sum of P500,000.00 as exemplary damages

account of the arbitrary and unlawful dismissal effecte

respondents. Consequently, respondents are there

ordered to pay complainant Quadra the total sum of

Million Six Hundred Thousand Pesos (P1,600,000

within ten (10) days after this Decision becomes final.

SO ORDERED.4

The NLRC affirmed the decision of the Labor Arbiter,5 promp

respondent PCSO to file a petition for certiorari with the Cou

Appeals.

The Court of Appeals reversed the decision of the NLRC. It held

there was no basis for the grant of moral and exemplary damage

petitioner as his dismissal was not tainted with bad faith. It was

Civil Service Commission that recommended petitioner's dism

after conducting an investigation. It also held that the pet

claiming moral and exemplary damages filed by petitioner respondent PCSO had complied with the CIR decision

reinstatement and backwages amounted to splitting of caus

action.6

Petitioner filed a motion for reconsideration of the decision of

Court of Appeals, but the same was denied for lack for merit .7

Petitioner now seeks the Court to review the ruling of the Cou

Appeals. He basically argues:

First: The ruling of the Court of Appeals that the PCSO

not act in bad faith when it dismissed the petitione

http://www.lawphil.net/judjuris/juri2006/jul2006/gr_147593_2006.html#fnt1































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contrary to the already final and executory decision of the

CIR dated November 1[9], 1966 finding the PCSO guilty of

bad faith and unfair labor practice in dismissing the

petitioner. The decision of the CIR was affirmed by the

High Court in the case of PCSO, et al. v. Geronimo Q.

Quadra, et al., 115 SCRA 34. The Court of Appeals has no

jurisdiction to amend the final and executory decision of

November 1[9], 1966 of the CIR which was affirmed by the

High Court. Once a decision has become final [and]

executory, it could no longer be amended or altered.


for moral and exemplary damages of the petitioner is

allegedly "tantamount to splitting of cause of action under

Sec. 4, Rule 2 of the 1997 Rules of Civil Procedure" is

contrary to law. When petitioner filed with the CIR his

complaint for illegal dismissal and unfair labor practice,

the prevailing law and jurisprudence was that the CIR did

not have jurisdiction to grant moral and exemplary

damages. Petitioner's claim for moral damages was filed

with the CIR in the same case by virtue of the ruling of the

High Court in Rheem v. Ferrer, 19 SCRA 130 holding that

the CIR has jurisdiction to award moral and exemplary

damages arising out of illegal dismissal and unfair laborpractice.

8

The petition is impressed with merit.

A dismissed employee is entitled to moral damages when the

dismissal is attended by bad faith or fraud or constitutes an act

oppressive to labor, or is done in a manner contrary to good morals,

good customs or public policy. Exemplary damages may be awarded

if the dismissal is effected in a wanton, oppressive or malevolent

manner.9 It appears from the facts that petitioner was deliberately

dismissed from the service by reason of his active involvement in the

activities of the union groups of both the rank and file and the

supervisory employees of PCSO, which unions he himself organizedand headed. Respondent PCSO first charged petitioner before the

Civil Service Commission for alleged neglect of duty and conduct

prejudicial to the service because of his union activities. The Civil

Service Commission recommended the dismissal of petitioner.

Respondent PCSO immediately served on petitioner a letter of

dismissal even before the latter could move for a reconsideration of

the decision of the Civil Service Commission. Respondent PCSO may

not impute to the Civil Service Commission the responsibility for

petitioner's illegal dismissal as it was respondent PCSO that first filed

the administrative charge against him. As found by the CIR,

petitioner's dismissal constituted unfair labor practice. It was done

to interfere with, restrain or coerce employees in the exercise of

their right to self-organization. It stated:

Upon the entire evidence as a whole (sic), the [c]ourt feels

and believes that complainant Quadra was discriminatorily

dismissed by reason of his militant union activities, not

only as President of PCSEA, but also as President of the

ASSPS.10

In Nueva Ecija I Electric Cooperative, Inc. (NEECO I) Employees

Association, et al. v. NLRC, et al.,11

we found it proper to award

moral and exemplary damages to illegally dismissed employees as

their dismissal was tainted with unfair labor practice. The Court said:

Unfair labor practices violate the constitutional right

workers and employees to self-organization, are inim

to the legitimate interests of both labor and managem

including their right to bargain collectively and other

deal with each other in an atmosphere of freedom

mutual respect; and disrupt industrial peace and hi

the promotion of healthy and stable labor-managem

relations. As the conscience of the government, it is

Court's sworn duty to ensure that none trifles with l

rights.

For this reason, we find it proper in this case to imp

moral and exemplary damages on private respondent

x

On the second issue, we agree with petitioner that the filing

petition for damages before the CIR did not constitute splittin

cause of action under the Revised Rules of Court. The Revised R

of Court prohibits parties from instituting more than one suit f

single cause of action. Splitting a cause of action is the act of divi

a single cause of action, claim or demand into two or more p

and bringing suit for one of such parts only, intending to reserve

rest for another separate action. The purpose of the rule is to a

harassment and vexation to the defendant and avoid multiplici

suits.12

The prevailing rule at the time that the action for unfair la

practice and illegal dismissal was filed and tried before the CIR

that said court had no jurisdiction over claims for damages. He

petitioner, at that time, could not raise the issue of damages in

proceedings. However, on January 27, 1967, the Supreme C

rendered its ruling in Rheem of the Philippines, Inc., et al. v. Fe

et al.13

upholding the jurisdiction of the CIR over claims for dam

incidental to an employee's illegal dismissal. Petitioner properly

his claim for damages after the declaration by the Court and be

the ruling on their case became final. Such filing could no

considered as splitting of cause of action.

IN VIEW WHEREOF, the assailed decision and resolution of the C

of Appeals are REVERSED and SET ASIDE. The decision of the N

in NLRC NCR Case No. 4312-ULP is REINSTATED.

SO ORDERED.




























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G.R. No. 147593 July 31, 2006

GERONIMO Q. QUADRA, petitioner,

vs.

THE COURT OF APPEALS and the PHILIPPINE CHARITY

SWEEPSTAKES OFFICE, respondents.

D E C I S I O N

PUNO, J .:

This is a petition for review of the decision of the Court of Appeals in

CA-G.R. SP No. 55634 dated December 29, 2000 and its resolution

dated March 26, 2001. The Court of Appeals reversed and set aside

the decision of the National Labor Relations Commission (NLRC) in

NLRC NCR Case No. 4312-ULP which affirmed the decision of the

Labor Arbiter granting moral and exemplary damages to petitioner

Geronimo Q. Quadra in connection with his dismissal from the

service.

Petitioner Geronimo Q. Quadra was the Chief Legal Officer of

respondent Philippine Charity Sweepstakes Office (PCSO) when he

organized and actively participated in the activities of PhilippineCharity Sweepstakes Employees Association (CUGCO), an

organization composed of the rank and file employees of PCSO, and

then later, the Association of Sweepstakes Staff Personnel and

Supervisors (CUGCO) (ASSPS [CUGCO]). In April 1964, he was

administratively charged before the Civil Service Commission with

violation of Civil Service Law and Rules for neglect of duty and

misconduct and/or conduct prejudicial to the interest of the service.

On July 14, 1965, the Civil Service Commission rendered a decision

finding petitioner guilty of the charges and recommending the

penalty of dismissal. The following day, on July 15, 1965, the General

Manager of PCSO, Ignacio Santos Diaz, sent petitioner a letter of

dismissal, in accordance with the decision of the Civil Service

Commission. Petitioner filed a motion for reconsideration of the

decision of the Civil Service Commission on August 10, 1965. At thesame time, petitioner, together with ASSPS (CUGCO), filed with the

Court of Industrial Relations (CIR) a complaint for unfair labor

practice against respondent PCSO and its officers. The case was

docketed as Case No. 4312-ULP.

On November 19, 1966, the CIR issued its decision finding

respondent PCSO guilty of unfair labor practice for having

committed discrimination against the union and for having

dismissed petitioner due to his union activities. It ordered the

reinstatement of petitioner to his former position with full

backwages and with all the rights and privileges pertaining to said

position.1

Respondent PCSO complied with the decision of the CIR. But while it

reinstated petitioner to his former position and paid his backwages,

it also filed with the Supreme Court a petition for review on

certiorari entitled "Philippine Charity Sweepstakes Office, et al. v.


decision of the CIR in Case No. 4312-ULP. The petition was docketed

as G.R. No. L-27546.2

On March 16, 1967, during the pendency of the case in the Supreme

Court, petitioner filed with the CIR a "Petition for Damages." He

prayed for moral and exemplary damages in connection with Case

No. 4312-ULP. He cited the decision of the Supreme Court in Rheem

of the Philippines, Inc., et al. v. Ferrer, et al.3 where it upheld

jurisdiction of the CIR over claims for damages incidental to

employee's dismissal.

Respondent PCSO moved to dismiss the petition for damages on

following grounds: (1) the CIR has no jurisdiction to award mora

exemplary damages; (2) the cause of action is barred by p

judgment, it appearing that two complaints are brought for diffe

parts of a single cause of action; and (3) the petition states no v

cause of action.

Petitioner resigned from PCSO on August 18, 1967.

The petition for damages and the motion to dismiss, howe

remained pending with the CIR until it was abolished and the N

was created. On April 25, 1980, the Labor Arbiter rendere

decision awarding moral and exemplary damages to petitioner in

amount of P1.6 million. The dispositive portion of the deci

stated:

WHEREFORE, in view of all the foregoing considerat

judgment is hereby rendered awarding to complai

Geronimo Q. Quadra moral damages consisting offollowing sum: Three Hundred Fifty Thousand P

(P350,000.00) for besmirched reputation; Three Hun

Fifty Thousand Pesos (P350,000.00) for social humilia

One Hundred Thousand Pesos (P100,000.00) for me

anguish; One Hundred Thousand Pesos (P100,000.00

serious anxiety; One Hundred Thousand P

(P100,000.00) for wounded feelings; One Hun

Thousand Pesos (P100,000.00) for moral shock; and

further sum of P500,000.00 as exemplary damages

account of the arbitrary and unlawful dismissal effecte

respondents. Consequently, respondents are there

ordered to pay complainant Quadra the total sum of

Million Six Hundred Thousand Pesos (P1,600,000

within ten (10) days after this Decision becomes final.

SO ORDERED.4

The NLRC affirmed the decision of the Labor Arbiter,5 promp

respondent PCSO to file a petition for certiorari with the Cou

Appeals.

The Court of Appeals reversed the decision of the NLRC. It held

there was no basis for the grant of moral and exemplary damage

petitioner as his dismissal was not tainted with bad faith. It was

Civil Service Commission that recommended petitioner's dism

after conducting an investigation. It also held that the pet

claiming moral and exemplary damages filed by petitioner respondent PCSO had complied with the CIR decision

reinstatement and backwages amounted to splitting of caus

action.6

Petitioner filed a motion for reconsideration of the decision of

Court of Appeals, but the same was denied for lack for merit .7

Petitioner now seeks the Court to review the ruling of the Cou

Appeals. He basically argues:

First: The ruling of the Court of Appeals that the PCSO

not act in bad faith when it dismissed the petitione
































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contrary to the already final and executory decision of the

CIR dated November 1[9], 1966 finding the PCSO guilty of

bad faith and unfair labor practice in dismissing the

petitioner. The decision of the CIR was affirmed by the

High Court in the case of PCSO, et al. v. Geronimo Q.

Quadra, et al., 115 SCRA 34. The Court of Appeals has no

jurisdiction to amend the final and executory decision of

November 1[9], 1966 of the CIR which was affirmed by the

High Court. Once a decision has become final [and]

executory, it could no longer be amended or altered.


for moral and exemplary damages of the petitioner is

allegedly "tantamount to splitting of cause of action under

Sec. 4, Rule 2 of the 1997 Rules of Civil Procedure" is

contrary to law. When petitioner filed with the CIR his

complaint for illegal dismissal and unfair labor practice,

the prevailing law and jurisprudence was that the CIR did

not have jurisdiction to grant moral and exemplary

damages. Petitioner's claim for moral damages was filed

with the CIR in the same case by virtue of the ruling of the

High Court in Rheem v. Ferrer, 19 SCRA 130 holding that

the CIR has jurisdiction to award moral and exemplary

damages arising out of illegal dismissal and unfair laborpractice.

8

The petition is impressed with merit.

A dismissed employee is entitled to moral damages when the

dismissal is attended by bad faith or fraud or constitutes an act

oppressive to labor, or is done in a manner contrary to good morals,

good customs or public policy. Exemplary damages may be awarded

if the dismissal is effected in a wanton, oppressive or malevolent

manner.9 It appears from the facts that petitioner was deliberately

dismissed from the service by reason of his active involvement in the

activities of the union groups of both the rank and file and the

supervisory employees of PCSO, which unions he himself organizedand headed. Respondent PCSO first charged petitioner before the

Civil Service Commission for alleged neglect of duty and conduct

prejudicial to the service because of his union activities. The Civil

Service Commission recommended the dismissal of petitioner.

Respondent PCSO immediately served on petitioner a letter of

dismissal even before the latter could move for a reconsideration of

the decision of the Civil Service Commission. Respondent PCSO may

not impute to the Civil Service Commission the responsibility for

petitioner's illegal dismissal as it was respondent PCSO that first filed

the administrative charge against him. As found by the CIR,

petitioner's dismissal constituted unfair labor practice. It was done

to interfere with, restrain or coerce employees in the exercise of

their right to self-organization. It stated:

Upon the entire evidence as a whole (sic), the [c]ourt feels

and believes that complainant Quadra was discriminatorily

dismissed by reason of his militant union activities, not

only as President of PCSEA, but also as President of the

ASSPS.10

In Nueva Ecija I Electric Cooperative, Inc. (NEECO I) Employees

Association, et al. v. NLRC, et al.,11

we found it proper to award

moral and exemplary damages to illegally dismissed employees as

their dismissal was tainted with unfair labor practice. The Court said:

Unfair labor practices violate the constitutional right

workers and employees to self-organization, are inim

to the legitimate interests of both labor and managem

including their right to bargain collectively and other

deal with each other in an atmosphere of freedom

mutual respect; and disrupt industrial peace and hi

the promotion of healthy and stable labor-managem

relations. As the conscience of the government, it is

Court's sworn duty to ensure that none trifles with l

rights.

For this reason, we find it proper in this case to im

moral and exemplary damages on private respondent

x

On the second issue, we agree with petitioner that the filing

petition for damages before the CIR did not constitute splittin

cause of action under the Revised Rules of Court. The Revised R

of Court prohibits parties from instituting more than one suit f

single cause of action. Splitting a cause of action is the act of divi

a single cause of action, claim or demand into two or more p

and bringing suit for one of such parts only, intending to reserve

rest for another separate action. The purpose of the rule is to a

harassment and vexation to the defendant and avoid multiplici

suits.12

The prevailing rule at the time that the action for unfair la

practice and illegal dismissal was filed and tried before the CIR

that said court had no jurisdiction over claims for damages. He

petitioner, at that time, could not raise the issue of damages in

proceedings. However, on January 27, 1967, the Supreme C

rendered its ruling in Rheem of the Philippines, Inc., et al. v. Fe

et al.13

upholding the jurisdiction of the CIR over claims for dam

incidental to an employee's illegal dismissal. Petitioner properly

his claim for damages after the declaration by the Court and be

the ruling on their case became final. Such filing could no

considered as splitting of cause of action.

IN VIEW WHEREOF, the assailed decision and resolution of the C

of Appeals are REVERSED and SET ASIDE. The decision of the N

in NLRC NCR Case No. 4312-ULP is REINSTATED.

SO ORDERED.




























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G.R. No. L-25134 October 30, 1969

THE CITY OF BACOLOD, plaintiff-appellee,

vs.

SAN MIGUEL BREWERY, INC., defendant-appellant.

First Assistant City Fiscal Raymundo O. Rallos for plaintiff-appellee.

Picazo and Agcaoili for defendant-appellant.

BARREDO, J.:

An appeal from the decision of the Court of First Instance of Negros

Occidental in its Civil Case No. 7355, ordering the San Miguel

Brewery, Inc. to pay to the City of Bacolod the sum of P36,519.10,

representing surcharges on certain fees which, under existing

ordinances of the City of Bacolod, the San Miguel Brewery should

have paid quarterly to the treasurer of the said city for and/or

during the period from July, 1959 to December, 1962, but which

were paid only on April 23, 1963.

On February 17, 1949, the City Council of Bacolod passed Ordinance

No. 66, series of 1949 imposing upon "any person, firm or

corporation engaged in the manufacturer bottling of coca-cola,pepsi cola, tru orange, lemonade, and other soft drinks within the

jurisdiction of the City of Bacolod, ... a fee of ONE TWENTY-FOURTH

(1/24) of a centavo for every bottle thereof," plus "a surcharge of 2%

every month, but in no case to exceed 24% for one whole year,"

upon "such local manufacturers or bottler above-mentioned who

will be delinquent on any amount of fees due" under the ordinance.

In 1959, this ordinance was amended by Ordinance No. 150, series

of 1959, by increasing the fee to "one-eighth (1/8) of a centavo for

every bottle thereof." In other words, the fee was increased from

P0.01 to P0.03 per case of soft drinks. Appellant refused to pay the

additional fee and challenged the validity of the whole ordinance.

Under date of March 23, 1960, appellee sued appellant in Civil Case

No. 5693 of the Court of First Instance of Negros Occidental, with

the corresponding Complaint alleging, inter alia:

3. — That the defendant, Manager of the San Miguel

Brewery, Bacolod Coca Cola Plant, Bacolod Branch since

the approval of Ordinance No. 66, Series of 1949 as

amended by Ordinance No. 150, Series of 1959, which

took effect on July 1, 1959, only paid to the plaintiff herein

the P0.01 bottling tax per case of soft drinks thereby

refusing to pay the P0.03 bottling tax per case of soft

drinks which amounted to P26,306.54 at P0.02 per case of

soft drinks such as coca cola and tru orange manufactured

or bottled by said company as per statement submitted bythe Assistant City Treasurer of Bacolod City herewith

attached as Annex "C" of this complaint;

and praying

... that judgment be rendered for the plaintiff:

"(a) Ordering the defendant to pay the plaintiff

the bottling taxes of P0.03 per case of soft drinks

as provided for in Section 1, Ordinance No. 66,

Series of 1949, as amended by Ordinance No.

150, Series of 1959, as well as the sum

P26,306.54 representing unpaid bottling t

due with legal rate of interest thereon from

date of the filing of this complaint until comp

payment thereof; ... costs, etc."'

In due time, appellant filed its answer. This was followed

stipulation of facts between the parties, whereupon, the c

rendered judgment on November 12, 1960; with the follow

dispositive portion:

WHEREFORE, San Miguel Brewery Inc. is ordered to pa

the plaintiff the sum of P26,306.54 and the tax at the

of three centavos per case levied in Ordinance No. 66

150 from March, 1960, and thereafter. Costs against

defendant.

Appellant appealed from the said decision to this Court whe

pressed the question of the invalidity of the abovementioned ta

ordinances. In that appeal (G.R. No. L-18290), however, this C

affirmed the decision appealed from and upheld

constitutionality of the questioned ordinances and the authorit

the appellee to enact the same. For reasons not extant in the rec

it was already after this decision had become final when appe

moved for the reconsideration thereof, praying that the sam

amended so as to include the penalties and surcharges provided

in the ordinances. Naturally, the said motion was denied, for

reason that "the decision is already final and may not be amend

When execution was had before the lower court, the appellee a

sought the inclusion of the surcharges referred to; and once a

the move was frustrated by the Court of First Instance of Ne

Occidental which denied the motion, as follows:

Acting upon the motion dated October 24, 1963, file

the Assistant City Fiscal, Raymundo Rallos, counsel for

plaintiff, and the opposition thereto filed by attorney

the defendants dated November 9, 1963, as well asreply to the opposition of counsel for the defend

dated December 5, 1963, taking into consideration

the decision of this Court as affirmed by the Supr

Court does not specifically mention the alleged surcha

claimed by the plaintiff-appellee, the Court he

resolves to deny, as it hereby denies, the afore

motion, for not being meritorious.

Failing thus in its attempt to collect the surcharge provided for in

ordinances in question, appellee filed a second action (Civil Case

7355) to collect the said surcharges. Under date of July 10, 196

filed the corresponding complaint before the same Court of

Instance of Negros Occidental alleging, inter alia, that:

6. That soon after the decision of the Honorable Supr

Court affirming the decision of the Hon. Court,

defendant herein on April 23, 1963 paid to the Cit

Bacolod, the amount of ONE HUNDRED FIFTY

THOUSAND NINE HUNDRED TWENTY FOUR PESOS

TWENTY CENTAVOS (P156,924.20) as taxes from July, 1

to December, 1962 in compliance with the provisio

Section 1, Ordinance No. 66, Series of 1949, as amende

Ordinance No. 150, Series of 1959, which correspond

the taxes due under said section in the amount of P

per case of soft soft drinks manufactured by the defend

but refused and still continued refusing to pay




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surcharge as provided for under Section 4 of Ordinance No.

66, Series of 1949, as amended by Ordinance No. 150,

Series of 1959, which reads as follows:

"SEC. 4 — A surcharge of 2% every month, but in

no case to exceed 24% for one whole year, shall

be imposed on such local manufacturer or

bottlers above mentioned who will be

delinquent on any amount of fees under the

ordinance."

which up to now amounted to THIRTY SIX THOUSAND FIVE

HUNDRED NINETEEN PESOS AND TEN CENTAVOS

(P36,519.10), as shown by the certified statement of the

office of the City Treasurer of Bacolod City herewith

attached as Annex "E" and made an integral part of this

complaint;

7. That the said interest and/or penalties to the said

bottling taxes which defendant refused to pay have long

been overdue;

and again praying

... that judgment be rendered for the plaintiff:

(a) Ordering the defendant to pay the penalty

and/or interest therein Section 4 of Ordinance

No. 66, Series of 1949, as amended by Ordinance

No. 150, Series of 1959 the total amount of

THIRTY SIX THOUSAND FIVE HUNDRED

NINETEEN PESOS and TEN CENTAVOS

(P36,519.10), representing the surcharges from

August, 1959 to December, 1962, inclusive, and

the 24% penalty computed as of June 30, 1964,

from the amount of P152,162.90, with legal rate

of interest thereon from the date of the filing of

this complaint until complete payment thereof;"

plus costs, etc.

On July 24, 1964, appellant filed a motion to dismiss the case on the

grounds that: (1) the cause of action is barred by a prior judgment,

and (2) a party may not institute more than one suit for a single

cause of action. This motion was denied by the court a quo in its

order dated August 22, 1964; so appellant filed its answer wherein it

substantially reiterated, as affirmative defenses, the above-

mentioned grounds of its motion to dismiss. Thereafter, the parties

submitted the case for judgment on the pleadings, whereupon, the

court rendered judgment on March 11, 1965 with the following

dispositive portion: .

IN VIEW THEREOF, judgment is hereby rendered ordering

the defendant San Miguel Brewery, Inc. to pay to the

plaintiff the sum of P36,519.10 representing the

surcharges as provided in section 4 of Ordinance 66, series

of 1949 of the City of Bacolod. No costs.

Appellants moved for reconsideration but its motion was denied,

hence, the instant appeal.

Appellant has only one assignment of error, to wit:

THE LOWER COURT ERRED IN FINDING THE APPELL

LIABLE TO THE APPELLEE FOR THE SUM OF P36,51

REPRESENTING SURCHARGES AS PROVIDED IN

ORDINANCE NO. 66, SERIES OF 1949, AS AMENDED

THE CITY OF BACOLOD.

Under this, it argues that the action of appellee cannot

maintained because (1) a party may not institute more than one

for a single cause of action; and (2) appellee's action for recover

the surcharges in question is barred by prior judgment.

We find appellant's position essentially correct. There is no ques

that appellee split up its cause of action when it filed the

complaint on March 23, 1960, seeking the recovery of only

bottling taxes or charges plus legal interest, without mentionin

any manner the surcharges.

The rule on the matter is clear. Sections 3 and 4 of Rule 2 of

Rules of Court of 1940 which were still in force then provided:

SEC. 3. Splitting a cause of action, forbidden . — A s

cause of action cannot be split up into two or more p

so as to be made the subject of different complaints. .

SEC. 4. Effect of splitting. — If separate complaints w

brought for different parts of a single cause of action,

filing of the first may be pleaded in abatement of

others, and a judgment upon the merits in eithe

available as a bar in the others.

Indeed, this rule against the splitting up of a cause of action is an

one. In fact, it preceded the Rules of Court or any statu

provision. In Bachrach Motor Co., Inc. vs. Icarangal et al .,1 this C

already explained its meaning, origin and purpose, thus:

But, even if we have no such section 708 of our CodCivil Procedure, or section 59 of the Insolvency Law

have still the rule against splitting a single cause of ac

This rule, though not contained in any statutory provi

has been applied by this court in all appropriate ca

Thus, in Santos vs. Moir (36 Phil. 350, 359), we said:

well recognized that a party cannot split a single caus

action into parts and sue on each part separatel

complaint for the recovery of personal property

damages for detention states a single cause of ac

which cannot be divided into an action for possession

one for damages; and if suit is brought for possession

a subsequent action cannot be maintained to recover

damages resulting from the unlawful detention." In R

de Larena vs. Villanueva (53 Phil. 923, 927), we reiterthe rule by stating that "... a party will not be permitte

split up a single cause of action and make it the basi

several suits" and that when a lease provides for

payment of the rent in separate installments,

installment constitutes an independent cause of ac

but when, at the time the complaint is filed, there

several installments due, all of them constitute a si

cause of action and should be included in a s

complaint, and if some of them are not so included,

are barred. The same doctrine is stated in Lavarro

Labitoria (54 Phil. 788), wherein we said that "a party

not be permitted to split up a single cause of action




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make it a basis for several suits" and that a claim for

partition of real property as well as for improvements

constitutes a single cause of action, and a complaint for

partition alone bars a subsequent complaint for the

improvements. And in Blossom & Co. vs. Manila Gas

Corporation (55 Phil. 226-240), we held that "as a general

rule a contract to do several things at several times is

divisible in its nature, so as to authorize successive actions;

and a judgment recovered for a single breach of a

continuing contract or covenant is no bar to suit for asubsequent breach thereof. But where the covenant or

contract is entire, and the breach total, there can be only

one action, and plaintiff must therein recover all his

damages.

The rule against splitting a single cause of action is

intended "to prevent repeated litigation between the

same parties in regard to the same subject of controversy;

to protect defendant from unnecessary vexation; and to

avoid the costs and expenses incident to numerous suits."

(1 C.J. 1107) It comes from that old maxim nemo debet bis

vexare pro una et eadem causa (no man shall be twice

vexed for one and the same cause). (Ex parte Lange, 18

Wall 163, 168; 21 Law Ed. 872; also U.S. vs. Throckmorton,98 U.S. 61; 25 Law Ed. 93). And it developed, certainly not

as an original legal right of the defendant, but as an

interposition of courts upon principles of public policy to

prevent inconvenience and hardship incident to repeated

and unnecessary litigations. (1 C. J. 1107).

In the light of these precedents, it cannot be denied that appellant's

failure to pay the bottling charges or taxes and the surcharges for

delinquency in the payment thereof constitutes but one single cause

of action which under the above rule can be the subject of only one

complaint, under pain of either of them being barred if not included

in the same complaint with the other. The error of appellee springs

from a misconception or a vague comprehension of the elements of

a cause of action. The classical definition of a cause of action is that

it is "a delict or wrong by which the rights of the plaintiff are violated

by the defendant." Its elements may be generally stated to be (1) a

right existing in favor of the plaintiff; (2) a corresponding obligation

on the part of the defendant to respect such right; and (3) an act or

omission of the plaintiff which constitutes a violation of the

plaintiff's right which defendant had the duty to respect. For

purposes, however, of the rule against splitting up of a cause of

action, a clearer understanding can be achieved, if together with

these elements, the right to relief is considered.

In the last analysis, a cause of action is basically an act or an

omission or several acts or omissions. A single act or omission can be

violative of various rights at the same time, as when the actconstitutes juridically a violation of several separate and distinct

legal obligations. This happens, for example, when a passenger of a

common carrier, such as a taxi, is injured in a collision thereof with

another vehicle due to the negligence of the respective drivers of

both vehicles. In such a case, several rights of the passenger are

violated, inter alia, (1) the right to be safe from the negligent acts of

either or both the drivers under the law on culpa-acquiliana or

quasi-delict; (2) the right to be safe from criminal negligence of the

said drivers under the penal laws; and (3) the right to be safely

conducted to his destination under the contract of carriage and the

law covering the same, not counting anymore the provisions of

Article 33 of the Civil Code. The violation of each of these rights is a

cause of action in itself. Hence, such a passenger has at least three

causes of action arising from the same act. On the other hand, it

happen also that several acts or omissions may violate only

right, in which case, there would be only one cause of action. A

the violation of a single right may give rise to more than one re

In other words, for a single cause of action or violation of a right,

plaintiff may be entitled to several reliefs. It is the filing of sepa

complaints for these several reliefs that constitutes splitting u

the cause of action. This is what is prohibited by the rule.

In the case at bar, when appellant failed and refused to paydifference in bottling charges from July 1, 1959, such ac

appellant in violation of the right of appellee to be paid said cha

in full under the Ordinance, was one single cause of action,

under the Ordinance, appellee became entitled, as a result of

non-payment, to two reliefs, namely: (1) the recovery of the bal

of the basic charges; and (2) the payment of the correspon

surcharges, the latter being merely a consequence of the failur

pay the former. Stated differently, the obligation of appellant to

the surcharges arose from the violation by said appellant of

same right of appellee from which the obligation to pay the b

charges also arose. Upon these facts, it is obvious that appellee

filed separate complaints for each of two reliefs related to the s

single cause of action, thereby splitting up the said cause of actio

The trial court held that inasmuch as there was no demand in

complaint in the first case for the payment of the surcharges, un

in the case of Collector of Internal Revenue vs. Blas Gutierrez, e

G.R. No. L-13819. May 25, 1960, wherein there was such a dem

there is no bar by prior judgment as to said surcharges, the same

having been "raised as an issue or cause of action in Civil Case

5693." This holding is erroneous.

Section 4 of Rule 2, above-quoted, is unmistakably clear as to

effect of the splitting up of a cause of action. It says, "if sepa

complaints are brought for different parts (reliefs) of a single c

of action, the filing of the first (complaint) may be pleade

abatement of the others, and a judgment upon the merits in eiis available as a bar in the others." In other words, whenev

plaintiff has filed more than one complaint for the same violatio

a right, the filing of the first complaint on any of the reliefs bor

the said violation constitutes a bar to any action on any of the o

possible reliefs arising from the same violation, whether the

action is still pending, in which event, the defense to the subseq

complaint would be litis pendentia, or it has already been fi

terminated, in which case, the defense would be res adjudic

Indeed, litis pendentia and res adjudicata, on the one hand,

splitting up a cause of action on the other, are not separate

distinct defenses, since either of the former is by law only the re

or effect of the latter, or, better said, the sanction for or behind

It thus results that the judgment of the lower court must be, ashereby, reversed and the complaint of appellee is dismissed

costs.




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G.R. No. 182435 August 13, 2012

LILIA B. ADA, LUZ B. ADANZA, FLORA C. BA YLON, REMO BA YLON,

JOSE BA YLON, ERIC BA YLON, FLORENTINO BA YLON, and MA.

RUBY BA YLON, Petitioners,

vs.

FLORANTE BA YLON, Respondent.

VILLARAMA, JR.,*

D E C I S I O N

REYES, J.:

Before this Court is a petition for review on certiorari under Rule 45

of the Rules of Court seeking to annul and set aside the Decisio n1

dated October 26, 2007 rendered by the Court of Appeals (CA) in

CA-G.R. CV No. 01746. The assailed decision partially reversed and

set aside the Decision2 dated October 20, 2005 issued ~y the

Regional Trial Court (RTC), Tan jay City, Negros Oriental, Branch 43 in

Civil Case No. 11657.

The Antecedent Facts

This case involves the estate of spouses Florentino Baylon and

Maximina Elnas Baylon (Spouses Baylon) who died on November 7,

1961 and May 5, 1974, respectively.3 At the time of their death,

Spouses Baylon were survived by their legitimate children, namely,

Rita Baylon (Rita), Victoria Baylon (Victoria), Dolores Baylon

(Dolores), Panfila Gomez (Panfila), Ramon Baylon (Ramon) and

herein petitioner Lilia B. Ada (Lilia).

Dolores died intestate and without issue on August 4, 1976. Victoria

died on November 11, 1981 and was survived by her daughter,

herein petitioner Luz B. Adanza. Ramon died intestate on July 8,

1989 and was survived by herein respondent Florante Baylon(Florante), his child from his first marriage, as well as by petitioner

Flora Baylon, his second wife, and their legitimate children, namely,

Ramon, Jr. and herein petitioners Remo, Jose, Eric, Florentino and

Ma. Ruby, all surnamed Baylon.

On July 3, 1996, the petitioners filed with the RTC a Complaint4 for

partition, accounting and damages against Florante, Rita and Panfila.

They alleged therein that Spouses Baylon, during their lifetime,

owned 43 parcels of land5 all situated in Negros Oriental. After the

death of Spouses Baylon, they claimed that Rita took possession of

the said parcels of land and appropriated for herself the income

from the same. Using the income produced by the said parcels of

land, Rita allegedly purchased two parcels of land, Lot No. 47096 and

half of Lot No. 4706,7 situated in Canda-uay, Dumaguete City. The

petitioners averred that Rita refused to effect a partition of the said

parcels of land.

In their Answer,8 Florante, Rita and Panfila asserted that they and

the petitioners co-owned 229 out of the 43 parcels of land

mentioned in the latter’s complaint, whereas Rita actually owned 10

parcels of land10

out of the 43 parcels which the petitioners sought

to partition, while the remaining 11 parcels of land are separately

owned by Petra Cafino Adanza,11

Florante,12

Meliton Adalia,13

Consorcia Adanza,14

Lilia15

and Santiago Mendez.16

Further, they

claimed that Lot No. 4709 and half of Lot No. 4706 were acquired by

Rita using her own money. They denied that Rita appropriated solely

for herself the income of the estate of Spouses Baylon,

expressed no objection to the partition of the estate of Spo

Baylon, but only with respect to the co-owned parcels of land.

During the pendency of the case, Rita, through a Deed of Dona

dated July 6, 1997, conveyed Lot No. 4709 and half of Lot No. 4

to Florante. On July 16, 2000, Rita died intestate and without

issue. Thereafter, learning of the said donation inter vivos in favo

Florante, the petitioners filed a Supplemental Pleading17

d

February 6, 2002, praying that the said donation in favor ofrespondent be rescinded in accordance with Article 1381(4) of

Civil Code. They further alleged that Rita was already sick and

weak when the said Deed of Donation was supposedly exec

and, thus, could not have validly given her consent thereto.

Florante and Panfila opposed the rescission of the said dona

asserting that Article 1381(4) of the Civil Code applies only w

there is already a prior judicial decree on who between

contending parties actually owned the properties under lit igatio

The RTC Decision

On October 20, 2005, the RTC rendered a Decision,19

the decportion of which reads:

Wherefore judgment is hereby rendered:

(1) declaring the existence of co-ownership over pa

nos. 1, 2, 3, 5, 7, 10, 13, 14, 16, 17, 18, 26, 29, 30, 33,

35, 36, 40 and 41 described in the complaint;

(2) directing that the above mentioned parcels of lan

partitioned among the heirs of Florentino Baylon

Maximina Baylon;

(3) declaring a co-ownership on the properties of Baylon namely parcels no[s]. 6, 11, 12, 20, 24, 27, 31

39 and 42 and directing that it shall be partitioned am

her heirs who are the plaintiffs and defendant in this ca

(4) declaring the donation inter vivos rescinded wit

prejudice to the share of Florante Baylon to the estat

Rita Baylon and directing that parcels nos. 1 an

paragraph V of the complaint be included in the divisio

the property as of Rita Baylon among her heirs, the pa

in this case;

(5) excluding from the co-ownership parcels nos. 20,

22, 9, 43, 4, 8, 19 and 37.

Considering that the parties failed to settle this case amicably

could not agree on the partition, the parties are directed

nominate a representative to act as commissioner to make

partition. He shall immediately take [his] oath of office upon

appointment. The commissioner shall make a report of all

proceedings as to the partition within fifteen (15) days from

completion of this partition. The parties are given ten (10)

within which to object to the report after which the Court shal

on the commissioner report.

SO ORDERED.20

(Emphasis ours)
















































































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The RTC held that the death of Rita during the pendency of the case,

having died intestate and without any issue, had rendered the issue

of ownership insofar as parcels of land which she claims as her own

moot since the parties below are the heirs to her estate. Thus, the

RTC regarded Rita as the owner of the said 10 parcels of land and,

accordingly, directed that the same be partitioned among her heirs.

Nevertheless, the RTC rescinded the donation inter vivos of Lot No.

4709 and half of Lot No. 4706 in favor of Florante. In rescinding the

said donation inter vivos, the RTC explained that:

However, with respect to lot nos. 4709 and 4706 which [Rita] had

conveyed to Florante Baylon by way of donation inter vivos, the

plaintiffs in their supplemental pleadings (sic) assailed the same to

be rescissible on the ground that it was entered into by the

defendant Rita Baylon without the knowledge and approval of the

litigants [or] of competent judicial authority. The subject parcels of

lands are involved in the case for which plaintiffs have asked the

Court to partition the same among the heirs of Florentino Baylon

and Maximina Elnas.

Clearly, the donation inter vivos in favor of Florante Baylon was

executed to prejudice the plaintiffs’ right to succeed to the estate of

Rita Baylon in case of death considering that as testified by Florante

Baylon, Rita Baylon was very weak and he tried to give her vitamins

x x x. The donation inter vivos executed by Rita Baylon in favor of

Florante Baylon is rescissible for the reason that it refers to the

parcels of land in litigation x x x without the knowledge and approval

of the plaintiffs or of this Court. However, the rescission shall not

affect the share of Florante Baylon to the estate of Rita Baylon.21

Florante sought reconsideration of the Decision dated October 20,

2005 of the RTC insofar as it rescinded the donation of Lot No. 4709

and half of Lot No. 4706 in his favor.22

He asserted that, at the time

of Rita’s death on July 16, 2000, Lot No. 4709 and half of Lot No.

4706 were no longer part of her estate as the same had already

been conveyed to him through a donation inter vivos three years

earlier. Thus, Florante maintained that Lot No. 4709 and half of LotNo. 4706 should not be included in the properties that should be

partitioned among the heirs of Rita.

On July 28, 2006, the RTC issued an Order23

which denied the

motion for reconsideration filed by Florante.

The CA Decision

On appeal, the CA rendered a Decision24

dated October 26, 2007,

the dispositive portion of which reads:

WHEREFORE, the Decision dated October 20, 2005 and Order dated

July 28, 2006 are REVERSED and SET ASIDE insofar as they decreedthe rescission of the Deed of Donation dated July 6, 1997 and the

inclusion of lot no. 4709 and half of lot no. 4706 in the estate of Rita

Baylon. The case is REMANDED to the trial court for the

determination of ownership of lot no. 4709 and half of lot no. 4706.

SO ORDERED.25

The CA held that before the petitioners may file an action for

rescission, they must first obtain a favorable judicial ruling that Lot

No. 4709 and half of Lot No. 4706 actually belonged to the estate of

Spouses Baylon and not to Rita. Until then, the CA asserted, an

action for rescission is premature. Further, the CA ruled that the

petitioners’ action for rescission cannot be joined with their ac

for partition, accounting and damages through a mere suppleme

pleading. Thus:

If Lot No. 4709 and half of Lot No. 4706 belonged to the Spou

estate, then Rita Baylon’s donation thereof in favor of Flor

Baylon, in excess of her undivided share therein as co-heir, is v

Surely, she could not have validly disposed of something she did

own. In such a case, an action for rescission of the donation m

therefore, prosper.

If the lots, however, are found to have belonged exclusively to

Baylon, during her lifetime, her donation thereof in favor of Flor

Baylon is valid. For then, she merely exercised her ownership r

to dispose of what legally belonged to her. Upon her death, the

no longer form part of her estate as their ownership now pertain

Florante Baylon. On this score, an action for rescission against s

donation will not prosper. x x x.

Verily, before plaintiffs-appellees may file an action for resciss

they must first obtain a favorable judicial ruling that lot no. 4709

half of lot no. 4706 actually belonged to the estate of Spo

Florentino and Maximina Baylon, and not to Rita Baylon during

lifetime. Until then, an action for rescission is premature. For

matter, the applicability of Article 1381, paragraph 4, of the

Civil Code must likewise await the trial court’s resolution of the i

of ownership.

Be that as it may, an action for rescission should be filed by

parties concerned independent of the proceedings below. The

cannot simply be lumped up with the second through a m

supplemental pleading.26

(Citation omitted)

The petitioners sought reconsideration27

of the Decision d

October 26, 2007 but it was denied by the CA in its Resoluti

dated March 6, 2008.

Hence, this petition.

Issue

The lone issue to be resolved by this Court is whether the CA e

in ruling that the donation inter vivos of Lot No. 4709 and half o

No. 4706 in favor of Florante may only be rescinded if ther

already a judicial determination that the same actually belonge

the estate of Spouses Baylon.

The Court’s Ruling

The petition is partly meritorious.

Procedural Matters

Before resolving the lone substantive issue in the instant case,

Court deems it proper to address certain procedural matters

need to be threshed out which, by laxity or otherwise, were

raised by the parties herein.

Misjoinder of Causes of Action































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The complaint filed by the petitioners with the RTC involves two

separate, distinct and independent actions – partition and

rescission. First, the petitioners raised the refusal of their co-heirs,

Florante, Rita and Panfila, to partition the properties which they

inherited from Spouses Baylon. Second, in their supplemental

pleading, the petitioners assailed the donation inter vivos of Lot No.

4709 and half of Lot No. 4706 made by Rita in favor of Florante

pendente lite.

The actions of partition andrescission cannot be joined in a

single action.

By a joinder of actions, or more properly, a joinder of causes of

action is meant the uniting of two or more demands or rights of

action in one action, the statement of more than one cause of action

in a declaration. It is the union of two or more civil causes of action,

each of which could be made the basis of a separate suit, in the

same complaint, declaration or petition. A plaintiff may under

certain circumstances join several distinct demands, controversies or

rights of action in one declaration, complaint or petition.29

The objectives of the rule or provision are to avoid a multiplicity ofsuits where the same parties and subject matter are to be dealt with

by effecting in one action a complete determination of all matters in

controversy and litigation between the parties involving one subject

matter, and to expedite the disposition of litigation at minimum

cost. The provision should be construed so as to avoid such

multiplicity, where possible, without prejudice to the rights of the

litigants.30

Nevertheless, while parties to an action may assert in one pleading,

in the alternative or otherwise, as many causes of action as they

may have against an opposing party, such joinder of causes of action

is subject to the condition, inter alia, that the joinder shall not

include special civil actions governed by special rules.31

Here, there was a misjoinder of causes of action. The action for

partition filed by the petitioners could not be joined with the action

for the rescission of the said donation inter vivos in favor of

Florante. Lest it be overlooked, an action for partition is a special

civil action governed by Rule 69 of the Rules of Court while an action

for rescission is an ordinary civil action governed by the ordinary

rules of civil procedure. The variance in the procedure in the special

civil action of partition and in the ordinary civil action of rescission

precludes their joinder in one complaint or their being tried in a

single proceeding to avoid confusion in determining what rules shall

govern the conduct of the proceedings as well as in the

determination of the presence of requisite elements of each

particular cause of action.32

A misjoined cause of action, if not

severed upon motion of a party or

by the court sua sponte, may be

adjudicated by the court together

with the other causes of action.

Nevertheless, misjoinder of causes of action is not a ground for

dismissal. Indeed, the courts have the power, acting upon the

motion of a party to the case or sua sponte, to order the severance

of the misjoined cause of action to be proceeded with separately .33

However, if there is no objection to the improper joinder or the

court did not motu proprio direct a severance, then there exist

bar in the simultaneous adjudication of all the erroneously jo

causes of action. On this score, our disquisition in Republic of

Philippines v. Herbiet o34

is instructive, viz:

This Court, however, disagrees with petitioner Republic in

regard. This procedural lapse committed by the respondents sh

not affect the jurisdiction of the MTC to proceed with and hear t

application for registration of the Subject Lots.

x x x x

Considering every application for land registration filed in s

accordance with the Property Registration Decree as a single c

of action, then the defect in the joint application for registra

filed by the respondents with the MTC constitutes a misjoinde

causes of action and parties. Instead of a single or joint applica

for registration, respondents Jeremias and David, m

appropriately, should have filed separate applications

registration of Lots No. 8422 and 8423, respectively.

Misjoinder of causes of action and parties do not involve a ques

of jurisdiction of the court to hear and proceed with the case. Tare not even accepted grounds for dismissal thereof. Instead, un

the Rules of Court, the misjoinder of causes of action and pa

involve an implied admission of the court’s jurisdiction

acknowledges the power of the court, acting upon the motion

party to the case or on its own initiative, to order the severanc

the misjoined cause of action, to be proceeded with separatel

case of misjoinder of causes of action); and/or the dropping

party and the severance of any claim against said misjoined p

also to be proceeded with separately (in case of misjoinde

parties).35

(Citations omitted)

It should be emphasized that the foregoing rule only applies if

court trying the case has jurisdiction over all of the causes of ac

therein notwithstanding the misjoinder of the same. If the ctrying the case has no jurisdiction over a misjoined cause of act

then such misjoined cause of action has to be severed from

other causes of action, and if not so severed, any adjudica

rendered by the court with respect to the same would be a nullit

Here, Florante posed no objection, and neither did the RTC d

the severance of the petitioners’ action for rescission from t

action for partition. While this may be a patent omission on the

of the RTC, this does not constitute a ground to assail the val

and correctness of its decision. The RTC validly adjudicated

issues raised in the actions for partition and rescission filed by

petitioners.

Asserting a New Cause of Action in a Supplemental Pleading

In its Decision dated October 26, 2007, the CA pointed out that

said action for rescission should have been filed by the petitio

independently of the proceedings in the action for partitio

opined that the action for rescission could not be lumped up

the action for partition through a mere supplemental pleading.

We do not agree.

A supplemental pleading may

a new cause of action as long as
































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has some relation to the original

cause of action set forth in the

original complaint.

Section 6, Rule 10 of the Rules of Court reads:

Sec. 6. Supplemental Pleadings. – Upon motion of a party the court

may, upon reasonable notice and upon such terms as are just,

permit him to serve a supplemental pleading setting forth

transactions, occurrences or events which have happened since thedate of the pleading sought to be supplemented. The adverse party

may plead thereto within ten (10) days from notice of the order

admitting the supplemental pleading.

In Young v. Spouses Sy ,36

this Court had the opportunity to elucidate

on the purpose of a supplemental pleading. Thus:

As its very name denotes, a supplemental pleading only serves to

bolster or add something to the primary pleading. A supplement

exists side by side with the original. It does not replace that which it

supplements. Moreover, a supplemental pleading assumes that the

original pleading is to stand and that the issues joined with the

original pleading remained an issue to be tried in the action. It is buta continuation of the complaint. Its usual office is to set up new facts

which justify, enlarge or change the kind of relief with respect to the

same subject matter as the controversy referred to in the original

complaint.

The purpose of the supplemental pleading is to bring into the

records new facts which will enlarge or change the kind of relief to

which the plaintiff is entitled; hence, any supplemental facts which

further develop the original right of action, or extend to vary the

relief, are available by way of supplemental complaint even though

they themselves constitute a right of action.37

(Citations omitted and

emphasis ours)

Thus, a supplemental pleading may properly allege transactions,

occurrences or events which had transpired after the filing of the

pleading sought to be supplemented, even if the said supplemental

facts constitute another cause of action.

Admittedly, in Leobrera v. Court of Appeals ,38

we held that a

supplemental pleading must be based on matters arising subsequent

to the original pleading related to the claim or defense presented

therein, and founded on the same cause of action. We further

stressed therein that a supplemental pleading may not be used to

try a new cause of action.

However, in Planters Development Bank v. LZK Holdings and

Development Corp. ,39 we clarified that, while a matter stated in asupplemental complaint should have some relation to the cause of

action set forth in the original pleading, the fact that the

supplemental pleading technically states a new cause of action

should not be a bar to its allowance but only a matter that may be

considered by the court in the exercise of its discretion. In such

cases, we stressed that a broad definition of "cause of action"

should be applied.

Here, the issue as to the validity of the donation inter vivos of Lot

No. 4709 and half of Lot No. 4706 made by Rita in favor of Florante

is a new cause of action that occurred after the filing of the original

complaint. However, the petitioners’ prayer for the rescission of the

said donation inter vivos in their supplemental pleading is germ

to, and is in fact, intertwined with the cause of action in the part

case. Lot No. 4709 and half of Lot No. 4706 are included among

properties that were sought to be partitioned.

The petitioners’ supplemental pleading merely amplified the orig

cause of action, on account of the gratuitous conveyance of Lot

4709 and half of Lot No. 4706 after the filing of the orig

complaint and prayed for additional reliefs, i.e., rescission. Ind

the petitioners claim that the said lots form part of the estatSpouses Baylon, but cannot be partitioned unless the gratui

conveyance of the same is rescinded. Thus, the principal issue ra

by the petitioners in their original complaint remained the same

Main Issue: Propriety of Rescission

After having threshed out the procedural matters, we now proc

to adjudicate the substantial issue presented by the instant petit

The petitioners assert that the CA erred in remanding the case to

RTC for the determination of ownership of Lot No. 4709 and ha

Lot No. 4706. They maintain that the RTC aptly rescinded the

donation inter vivos of Lot No. 4709 and half of Lot No. 4pursuant to Article 1381(4) of the Civil Code.

In his Comment,40

Florante asserts that before the petitioners

file an action for rescission, they must first obtain a favorable jud

ruling that Lot No. 4709 and half of Lot No. 4706 actually belon

to the estate of Spouses Baylon. Until then, Florante avers tha

action for rescission would be premature.

The petitioners’ contentions are well-taken.

The resolution of the instant dispute is fundamentally contin

upon a determination of whether the donation inter vivos of Lot

4709 and half of Lot No. 4706 in favor of Florante may be rescinpursuant to Article 1381(4) of the Civil Code on the ground that

same was made during the pendency of the action for partition

the RTC.

Rescission is a remedy to add

the damage or injury caused to

contracting parties or t

persons.

Rescission is a remedy granted by law to the contracting parties

even to third persons, to secure the reparation of damages ca

to them by a contract, even if it should be valid, by means of

restoration of things to their condition at the moment prior to

celebration of said contract.41 It is a remedy to make ineffecti

contract, validly entered into and therefore obligatory under no

conditions, by reason of external causes resulting in a pecun

prejudice to one of the contracting parties or their creditors.42

Contracts which are rescissible are valid contracts having all

essential requisites of a contract, but by reason of injury or dam

caused to either of the parties therein or to third persons

considered defective and, thus, may be rescinded.

The kinds of rescissible contracts, according to the reason for t

susceptibility to rescission, are the following: first, those which
































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rescissible because of lesion or prejudice;43

second, those which are

rescissible on account of fraud or bad faith;44

and third, those which,

by special provisions of law,45

are susceptible to rescission.46

Contracts which refer to things

subject of litigation is rescissible

pursuant to Article 1381(4) of the

Civil Code.

Contracts which are rescissible due to fraud or bad faith includethose which involve things under litigation, if they have been

entered into by the defendant without the knowledge and approval

of the litigants or of competent judicial authority. Thus, Article

1381(4) of the Civil Code provides:

Art. 1381. The following contracts are rescissible:

x x x x

(4) Those which refer to things under litigation if they have been

entered into by the defendant without the knowledge and approval

of the litigants or of competent judicial authority.

The rescission of a contract under Article 1381(4) of the Civil Code

only requires the concurrence of the following: first, the defendant,

during the pendency of the case, enters into a contract which refers

to the thing subject of litigation; and second, the said contract was

entered into without the knowledge and approval of the litigants or

of a competent judicial authority. As long as the foregoing requisites

concur, it becomes the duty of the court to order the rescission of

the said contract.

The reason for this is simple. Article 1381(4) seeks to remedy the

presence of bad faith among the parties to a case and/or any

fraudulent act which they may commit with respect to the thing

subject of litigation.

When a thing is the subject of a judicial controversy, it should

ultimately be bound by whatever disposition the court shall render.

The parties to the case are therefore expected, in deference to the

court’s exercise of jurisdiction over the case, to refrain from doing

acts which would dissipate or debase the thing subject of the

litigation or otherwise render the impending decision therein

ineffectual.

There is, then, a restriction on the disposition by the parties of the

thing that is the subject of the litigation. Article 1381(4) of the Civil

Code requires that any contract entered into by a defendant in a

case which refers to things under litigation should be with the

knowledge and approval of the litigants or of a competent judicial

authority.

Further, any disposition of the thing subject of litigation or any act

which tends to render inutile the court’s impending disposition in

such case, sans the knowledge and approval of the litigants or of the

court, is unmistakably and irrefutably indicative of bad faith. Such

acts undermine the authority of the court to lay down the respective

rights of the parties in a case relative to the thing subject of litigation

and bind them to such determination.

It should be stressed, though, that the defendant in such a ca

not absolutely proscribed from entering into a contract which r

to things under litigation. If, for instance, a defendant enters in

contract which conveys the thing under litigation during

pendency of the case, the conveyance would be valid, there b

no definite disposition yet coming from the court with respect to

thing subject of litigation. After all, notwithstanding that the sub

thereof is a thing under litigation, such conveyance is but mere

exercise of ownership.

This is true even if the defendant effected the conveyance wit

the knowledge and approval of the litigants or of a compe

judicial authority. The absence of such knowledge or approval w

not precipitate the invalidity of an otherwise valid cont

Nevertheless, such contract, though considered valid, may

rescinded at the instance of the other litigants pursuant to Ar

1381(4) of the Civil Code.

Here, contrary to the CA’s disposition, the RTC aptly ordered

rescission of the donation inter vivos of Lot No. 4709 and half o

No. 4706 in favor of Florante. The petitioners had sufficie

established the presence of the requisites for the rescission

contract pursuant to Article 1381(4) of the Civil Code.

undisputed that, at the time they were gratuitously conveye

Rita, Lot No. 4709 and half of Lot No. 4706 are among the prope

that were the subject of the partition case then pending with

RTC. It is also undisputed that Rita, then one of the defendan

the partition case with the RTC, did not inform nor sought

approval from the petitioners or of the RTC with regard to

donation inter vivos of the said parcels of land to Florante.

Although the gratuitous conveyance of the said parcels of lan

favor of Florante was valid, the donation inter vivos of the s

being merely an exercise of ownership, Rita’s failure to inform

seek the approval of the petitioners or the RTC regarding

conveyance gave the petitioners the right to have the said dona

rescinded pursuant to Article 1381(4) of the Civil Code.

Rescission under Article 1381(4)

the Civil Code is not preconditio

upon the judicial determination

to the ownership of the t

subject of litigation.

In this regard, we also find the assertion that rescission may onl

had after the RTC had finally determined that the parcels of

belonged to the estate of Spouses Baylon intrinsically amiss.

petitioners’ right to institute the action for rescission pursuan

Article 1381(4) of the Civil Code is not preconditioned upon

RTC’s determination as to the ownership of the said parcels of la

It bears stressing that the right to ask for the rescission of a cont

under Article 1381(4) of the Civil Code is not contingent upon

final determination of the ownership of the thing subjec

litigation. The primordial purpose of Article 1381(4) of the Civil C

is to secure the possible effectivity of the impending judgment

court with respect to the thing subject of litigation. It seek

protect the binding effect of a court’s impending adjudication v

vis the thing subject of litigation regardless of which among

contending claims therein would subsequently be uph

Accordingly, a definitive judicial determination with respect to

thing subject of litigation is not a condition sine qua non before




















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rescissory action contemplated under Article 1381(4) of the Civil

Code may be instituted.

Moreover, conceding that the right to bring the rescissory action

pursuant to Article 1381(4) of the Civil Code is preconditioned upon

a judicial determination with regard to the thing subject litigation,

this would only bring about the very predicament that the said

provision of law seeks to obviate. Assuming arguendo that a

rescissory action under Article 1381(4) of the Civil Code could only

be instituted after the dispute with respect to the thing subject oflitigation is judicially determined, there is the possibility that the

same may had already been conveyed to third persons acting in

good faith, rendering any judicial determination with regard to the

thing subject of litigation illusory. Surely, this paradoxical eventuality

is not what the law had envisioned.

Even if the donation inter vivos is

validly rescinded, a determination

as to the ownership of the subject

parcels of land is still necessary.

Having established that the RTC had aptly ordered the rescission of

the said donation inter vivos in favor of Florante, the issue that has

to be resolved by this Court is whether there is still a need to

determine the ownership of Lot No. 4709 and half of Lot No. 4706.

In opting not to make a determination as to the ownership of Lot

No. 4709 and half of Lot No. 4706, the RTC reasoned that the parties

in the proceedings before it constitute not only the surviving heirs of

Spouses Baylon but the surviving heirs of Rita as well. As intimated

earlier, Rita died intestate during the pendency of the proceedings

with the RTC without any issue, leaving the parties in the

proceedings before the RTC as her surviving heirs. Thus, the RTC

insinuated, a definitive determination as to the ownership of the

said parcels of land is unnecessary since, in any case, the said parcels

of land would ultimately be adjudicated to the parties in the

proceedings before it.

We do not agree.

Admittedly, whoever may be adjudicated as the owner of Lot No.

4709 and half of Lot No. 4706, be it Rita or Spouses Baylon, the same

would ultimately be transmitted to the parties in the proceedings

before the RTC as they are the only surviving heirs of both Spouses

Baylon and Rita. However, the RTC failed to realize that a definitive

adjudication as to the ownership of Lot No. 4709 and half of Lot No.

4706 is essential in this case as it affects the authority of the RTC to

direct the partition of the said parcels of land. Simply put, the RTC

cannot properly direct the partition of Lot No. 4709 and half of Lot

No. 4706 until and unless it determines that the said parcels of landindeed form part of the estate of Spouses Baylon.

It should be stressed that the partition proceedings before the RTC

only covers the properties co-owned by the parties therein in their

respective capacity as the surviving heirs of Spouses Baylon. Hence,

the authority of the RTC to issue an order of partition in the

proceedings before it only affects those properties which actually

belonged to the estate of Spouses Baylon.

In this regard, if Lot No. 4709 and half of Lot No. 4706, as

unwaveringly claimed by Florante, are indeed exclusively owned by

Rita, then the said parcels of land may not be partitioned

simultaneously with the other properties subject of the part

case before the RTC. In such case, although the parties in the

before the RTC are still co-owners of the said parcels of land,

RTC would not have the authority to direct the partition of the

parcels of land as the proceedings before it is only concerned

the estate of Spouses Baylon.

WHEREFORE, in consideration of the foregoing disquisitions,

petition is PARTIALLY GRANTED. The Decision dated October

2007 issued by the Court of Appeals in CA-G.R. CV No. 0174MODIFIED in that the Decision dated October 20, 2005 issued by

Regional Trial Court, Tanjay City, Negros Oriental, Branch 43 in

Case No. 11657, insofar as it decreed the rescission of the Dee

Donation dated July 6, 1997 is hereby REINSTATED. The ca

REMANDED to the trial court for the determination of

ownership of Lot No. 4709 and half of Lot No. 4706 in accord

with this Decision.

SO ORDERED.




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G.R. No. 147417 July 8, 2005

SPS. VICTOR & MILAGROS PEREZ and CRISTINA AGRAVIADOR

AVISO, Petitioners,

vs.

ANTONIO HERMANO, Respondent.

D E C I S I O N

CHICO-NAZARIO, J .:

This is a petition for review on certiorari under Rule 45 of the Rules

of Court assailing the Resolution1 of the Court of Appeals dismissing

petitioners’ original action for certiorari under Rule 65 for being filed

out of time. Assailed as well is the Resolution2 dismissing petitioners’

motion for reconsideration.

The pertinent facts of the case are as follows:

On 27 April 1998, petitioners Cristina Agraviador Aviso and spouses

Victor and Milagros Perez filed a civil case for Enforcement of

Contract and Damages with Prayer for the Issuance of a Temporary

Restraining Order (TRO) and/or Preliminary Injunction against

Zescon Land, Inc. and/or its President Zenie Sales-Contreras, Atty.

Perlita Vitan-Ele and against respondent herein Antonio Hermano

before the Regional Trial Court (RTC) of Quezon City, Branch 224.3

On 15 May 1998, respondent (then defendant) Hermano filed his

Answer with Compulsory Counterclaim. On 17 January 2000,

respondent Hermano filed a "Motion with Leave to Dismiss the

Complaint or Ordered Severed for Separate Trial" which was granted

by the trial court in an Order dated 28 February 2000.

This Order was received by petitioners on 21 March 2000. On 23

March 2000, petitioners moved for reconsideration which was

denied by the trial court on 25 May 2000 and received by petitioners

on 18 June 2000. On 17 August 2000, petitioners filed an originalaction for certiorari before the Court of Appeals imputing grave

abuse of discretion on the part of the trial court in dismissing the

complaint against respondent Hermano.

On 19 October 2000, the Court of Appeals rendered the first assailed

Resolution dismissing the petition for certiorari "for having been

filed beyond the reglementary period pursuant to Section 4, Rule 65

of the 1997 Rules on Civil Procedure, as amended." On 02 March

2001, the second assailed Resolution was promulgated dismissing

petitioners’ motion for reconsideration, the Court of Appeals

holding that:

From the time petitioners received the assailed Order on March 21,

2000 and filed their motion for reconsideration, four (4) days had

elapsed. On June 18, 2000, petitioners received the denial of their

motion for reconsideration. When the instant petition was filed on

August 17, 2000, a total of 63 days had elapsed.

A.M. No. 00-2-03-50 further amending Section 4, Rule 65 of the New

Rules on Civil Procedure states that the petition shall be filed not

later than sixty (60) days from notice of the judgment, Order or

Resolution and in case a motion for reconsideration or new trial is

timely filed, whether such motion is required or not, the 60-day

period shall be counted from notice of the denial of said motion.

Viewed from its light, the assailed Orders had already atta

finality, and are now beyond the power of this Court to review.4

Aggrieved by the foregoing ruling, petitioners are now befor

assigning the following –

MANIFEST AND/OR SERIOUS ERROR COMMITTED BY

HONORABLE COURT OF APPEALS IN THE COMPUTATION OF

PERIOD WITHIN WHICH THE PETITIONERS FILED THEIR PETITION

CERTIORARI BEFORE IT AND CONSEQUENTLY COMMITTED GRABUSE OF DISCRETION IN THE APPRECIATION OF FACTS AND

MISAPPREHENSION OF FACTS, WITH ITS FINDING OF FACT

BEING BORNE BY THE RECORD OR EVIDENCE, AND THUS

CONCLUSION IS ENTIRELY BASELESS.5

According to petitioners, following the amendment introduce

A.M. No. 00-2-03-SC to Section 4, Rule 65 of the 1997 Rules on

Procedure, their petition was filed on the 60th day, thus, within

reglementary period. Respondent insists, on the other hand,

the petition was filed on the 61st day while the Court of Appeals

declared that the petition was filed on the 63rd day.

We agree in the position taken by petitioners.

Admittedly, at the time petitioners filed their petition for certi

on 17 August 2000, the rule then prevailing was Section 4, Rule 6

the 1997 Rules on Civil Procedure, as amended by Circular No. 3

effective 01 September 1998, which provides:

Sec. 4. Where petition filed. – The petition shall be filed not

than sixty (60) days from notice of the judgment, order or resolu

sought to be assailed in the Supreme Court, or if it relates to the

or omissions of a lower court or of a corporation, board, office

person in the Regional Trial Court exercising jurisdiction over

territorial area as defined by the Supreme Court. It may also be

in the Court of Appeals whether or not the same is in aid o

appellate jurisdiction, or in the Sandiganbayan if it is in aid o

jurisdiction. If it involves the acts or omissions of a quasi-jud

agency, and unless otherwise provided by law or these Rules,

petition shall be filed in and cognizable only by the Court of Appe

If the petitioner had filed a motion for new trial or reconsideratio

due time after notice of said judgment, order, or resolution,

period herein fixed shall be interrupted. If the motion is denied

aggrieved party may file the petition within the remaining pe

but which shall not be less than five (5) days in any ev

reckoned from notice of such denial. No extension of time to

the petition shall be granted except for the most compelling rea

and in no case to exceed fifteen (15) days. (Emphasis supplied)

However, on 01 September 2000, during the pendency of the

before the Court of Appeals, Section 4 was amended anew by A

No. 00-2-03-SC6 which now provides:

Sec. 4. When and where petition filed. – The petition shall be

not later than sixty (60) days from notice of the judgment, orde

resolution. In case a motion for reconsideration or new tri

timely filed, whether such motion is required or not, the sixty

day period shall be counted from notice of the denial of

motion.



























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The petition shall be filed in the Supreme Court or, if it relates to the

acts or omissions of a lower court or of a corporation, board, officer

or person, in the Regional Trial Court exercising jurisdiction over the

territorial area as defined by the Supreme Court. It may also be filed

in the Court of Appeals whether or not the same is in aid of its

appellate jurisdiction, or in the Sandiganbayan if it is in aid of its

appellate jurisdiction. If it involves the acts or omissions of a quasi-

judicial agency, unless otherwise provided by law or these rules, the

petition shall be filed in and cognizable only by the Court of Appeals.

No extension of time to file the petition shall be granted except for

compelling reason and in no case exceeding fifteen (15) days.

(Emphasis supplied)

Under this amendment, the 60-day period within which to file the

petition starts to run from receipt of notice of the denial of the

motion for reconsideration, if one is filed.7

In Narzoles v. National Labor Relations Commission,8 we described

this latest amendment as curative in nature as it remedied the

confusion brought about by Circular No. 39-98 because, "historically,

i.e., even before the 1997 revision to the Rules of Civil Procedure, a

party had a fresh period from receipt of the order denying the

motion for reconsideration to file a petition for certiorari ." Curative

statutes, which are enacted to cure defects in a prior law or to

validate legal proceedings which would otherwise be void for want

of conformity with certain legal requirements, by their very essence,

are retroactive.9 And, being a procedural rule, we held in Sps. Ma.

Carmen and Victor Javellana v. Hon. Presiding Judge Benito

Legard a10

that "procedural laws are construed to be applicable to

actions pending and undetermined at the time of their passage, and

are deemed retroactive in that sense and to that extent."

Consequently, petitioners had a fresh period of 60 days from the

time they received the Order of the trial court denying their motion

for reconsideration on 18 June 2000. When they filed their petition

with the Court of Appeals on 17 August 2000, exactly 60 days hadelapsed following the rule that in computing a period, the first day

shall be excluded and the last day included.11

Hence, there can be no

doubt that the petition was filed within the reglementary period for

doing so and it was reversible error on the part of the Court of

Appeals in not giving said petition due course . However, instead of

remanding the case to the Court of Appeals which would only

unduly prolong the disposition of the substantive issue raised, we

shall resolve the petition originally filed therein.

Petitioners brought to the Court of Appeals on petition for certiorari

under Rule 65 the lone issue of:

WHETHER OR NOT THE PUBLIC RESPONDENT [Hon. Emilio L.Leachon, Jr., Presiding Judge, RTC, Branch 224, Quezon City] HAD

PLAINLY AND MANIFESTLY ACTED WITH GRAVE ABUSE OF

DISCRETION, IN EXCESS OF JURISDICTION, TANTAMOUNT TO LACK

OF JURISDICTION, IN DISMISSING THE COMPLAINT AS AGAINST

RESPONDENT ANTONIO HERMANO IN CIVIL CASE NO. Q-98-34211.12

Petitioners assert that respondent Hermano should not have been

dismissed from the complaint because: (1) He did not file a motion

to dismiss under Rule 16 of the Rules of Court and, in fact, his

"Motion with Leave to Dismiss the Complaint or Ordered Severed

for Separate Trial" was filed almost two years after he filed his

Answer to the complaint; (2) There was no misjoinder of cause

action in this case; and (3) There was no misjoinder of parties.

The case filed by petitioners against respondent Hermano and

other defendants, namely Zescon Land, Inc. and/or its Presi

Zenie Sales-Contreras and Atty. Perlita Vitan-Ele, was one

"Enforcement of Contract and Damages with Prayer for the Issu

of a Temporary Restraining Order (TRO) and/or Prelimi

Injunction" docketed as Civil Case No. Q-98-34211 and raffle

Branch 224.

Petitioners presented three causes of action in their complaint,

first for enforcement of contract to sell entered into betw

petitioners and Zescon Land, Inc., the second for annulmen

rescission of two contracts of mortgage entered into betw

petitioners and respondent Hermano and the third for dam


For the first cause of action, petitioners allege that sometim

November 1997, they entered into a Contract to Sell with Ze

Land, Inc., through Zenie Sales-Contreras, for the purchase of fiv

parcels of land in the total amount of Nineteen Million One Hund

Four Thousand Pesos (P19,104,000.00). As part of their agreem

a portion of the purchase price would be paid to them as d

payment, another portion to be given to them as cash advance u

the execution of the contract and another portion to be used by

buyer, Zescon Land, Inc., to pay for loans earlier contracted

petitioners which loans were secured by mortgages.

Re-pleading the foregoing in their second cause of ac

petitioners contend that "in a tricky machination and simultan

with the execution of the aforesaid Contract to Sell," they w

made to sign other documents, two of which were Mortgage de

over the same five properties in favor of respondent Herm

whom they had never met. It was allegedly explained to them

Sales-Contreras that the mortgage contracts would merely serv

facilitate the payment of the price as agreed upon in their Contto Sell. Petitioners claim that it was never their intentio

mortgage their property to respondent Hermano and that they

never received a single centavo from mortgaging their propert

him. Petitioners acknowledge, however, that respondent Herm

was responsible for discharging their obligations under the

mortgage and for having the titles over the subject lands relea

albeit not to them but to respondent Hermano. They seek a

against respondent Hermano who had informed them that he w

be foreclosing the subject properties.

In their third cause of action, petitioners pray for damages again

the defendants alleging that:

Due to the failure and refusal, without any valid justification

reason, by defendants Zescon and Contreras to comply with t

obligations under the Contract to Sell, including their failure

refusal to pay the sums stipulated therein, and in misleading

misrepresenting the plaintiffs into mortgaging their propertie

defendant Antonio Hermano, who in turn had not paid the plain

the proceeds thereof, putting them in imminent danger of losing

same, plaintiffs had suffered, and continue to suffer, sleepless n

….

By reason of defendants Zescon and Contreras’s failure and ref

to pay the sums stipulated in the Contract to Sell, and of defen




























meikim

Antonio Hermano’s not having paid plaintiffs the proceeds of the

mortgage agreements, plaintiffs had been deprived of the beneficial

use of the proceeds and stood to lose, as they continue to lose, by

way of unearned profits at least P1,000,000.00.13

In his Answer with (Compulsory) Counterclaim dated 15 May 1998,

respondent Hermano denied petitioners’ allegations.14

Then, on 19

February 1999, respondent Hermano filed a civil case entitled

"Judicial Foreclosure of Real Estate Mortgage" against petitioner

Aviso docketed as Civil Case No. Q-99-36914 and raffled to Branch216 of the RTC of Quezon City. On 17 January 2000, respondent

Hermano filed a "Motion With Leave To Dismiss The Complaint

Against Defendant Antonio Hermano, Or Ordered Severed For

Separate Trial" before Branch 224. In said motion, respondent

Hermano argued that there was a mis-joinder of causes of action

under Rule 2, Section 6 of the Rules of Court. To quote respondent

Hermano:

3. In the instant case, the plaintiffs’ action for the Enforcement of

Contract and Damages with Prayer for The Issuance of a Temporary

Restraining Order And/Or Preliminary Injunction against Zescon

Land, Inc., and/or its President Zenie Sales Contreras, may not,

under Rule 2, Section 6 of the 1997 Rules of Civil Procedure, join

defendant Hermano as party defendant to annul and/or rescind the

Real Estate Mortgages of subject properties. There is a misjoinder of

parties defendants under a different transaction or cause of action;

that under the said Rule 2, Section 6, upon motion of defendant

Hermano in the instant case, the complaint against defendant

Hermano can be severed and tried separately; . . . .15

Over petitioners’ opposition to said motion, the same was granted

by the trial court in its Order dated 28 February 2000 on the

justification that:

. . . [D]efendant having filed a special civil action for judicial

foreclosure of mortgage and now pending before RTC Branch 216,

he should be dropped as one of the defendants in this case andwhatever claims plaintiffs may have against defendant Hermano,

they can set it up by way of an answer to said judicial foreclosure .16

And, in an Order dated 25 May 2000, the trial court resolved

petitioners’ motion for reconsideration by dismissing the same, to

wit:

After going over the arguments of the parties, the Court believes

that defendant Hermano has nothing to do with the transaction

which the plaintiffs entered into with defendant Zescon Land, Inc.

Besides, the said motion raised matters and defenses previously

considered and passed upon by the Court.17

It is these two Orders that were brought up by petitioners to the

Court of Appeals on petition for Certiorari under Rule 65. The pivotal

issue to be resolved, therefore, is whether or not respondent trial

court committed grave abuse of discretion in dismissing the

complaint against respondent Hermano in Civil Case No. Q-98-

34211.

As far as we can glean from the Orders of the trial court, respondent

Hermano was dropped from the complaint on the ground of

misjoinder of causes of action. Petitioners, on the other hand, insist

that there was no misjoinder in this case.

To better understand the present controversy, it is vital to revisit

rules on joinder of causes of action as exhaustively discusse

Republic v. Hernandez,18

thus:

By a joinder of actions, or more properly, a joinder of cause

action, is meant the uniting of two or more demands or righ

action in one action; the statement of more than one cause of ac

in a declaration. It is the union of two or more civil causes of ac

each of which could be made the basis of a separate suit, in

same complaint, declaration or petition. A plaintiff may ucertain circumstances join several distinct demands, controversi

rights of action in one declaration, complaint or petition.

As can easily be inferred from the above definitions, a par

generally not required to join in one suit several distinct cause

action. The joinder of separate causes of action, where allowab

permissive and not mandatory in the absence of a contrary statu

provision, even though the causes of action arose from the s

factual setting and might under applicable joinder rules be joi

Modern statutes and rules governing joinders are intended to a

a multiplicity of suits and to promote the efficient administratio

justice wherever this may be done without prejudice to the righ

the litigants. To achieve these ends, they are liberally construed.

While joinder of causes of action is largely left to the option

party litigant, Section 5, Rule 2 of our present Rules allows cause

action to be joined in one complaint conditioned upon the follow

requisites: (a) it will not violate the rules on jurisdiction, venue

joinder of parties; and (b) the causes of action arise out of the s

contract, transaction or relation between the parties, or are

demands for money or are of the same nature and character.

The objectives of the rule or provision are to avoid a multiplicit

suits where the same parties and subject matter are to be dealt

by effecting in one action a complete determination of all matte

controversy and litigation between the parties involving one su

matter, and to expedite the disposition of litigation at minimcost. The provision should be construed so as to avoid

multiplicity, where possible, without prejudice to the rights of

litigants. Being of a remedial nature, the provision should be libe

construed, to the end that related controversies between the s

parties may be adjudicated at one time; and it should be m

effectual as far as practicable, with the end in view of promoting

efficient administration of justice.

The statutory intent behind the provisions on joinder of cause

action is to encourage joinder of actions which could reasonabl

said to involve kindred rights and wrongs, although the courts

not succeeded in giving a standard definition of the terms used o

developing a rule of universal application. The dominant idea

permit joinder of causes of action, legal or equitable, where the

some substantial unity between them. While the rule allow

plaintiff to join as many separate claims as he may have, t

should nevertheless be some unity in the problem presented a

common question of law and fact involved, subject always to

restriction thereon regarding jurisdiction, venue and joinde

parties. Unlimited joinder is not authorized.

Our rule on permissive joinder of causes of action, with the pro

subjecting it to the correlative rules on jurisdiction, venue

joinder of parties and requiring a conceptual unity in the prob

presented, effectively disallows unlimited joinder.




























Section 6, Rule 2 on misjoinder of causes of action provides:

Sec. 6. Misjoinder of causes of action. - Misjoinder of causes of

action is not a ground for dismissal of an action. A misjoined cause

of action may, on motion of a party or on the initiative of the court,

be severed and proceeded with separately.

There is misjoinder of causes of action when the conditions for

joinder under Section 5, Rule 2 are not met. Section 5 provides:

Sec. 5. Joinder of causes of action. - A party may in one pleading

assert, in the alternative or otherwise, as many causes of action as

he may have against an opposing party, subject to the following

conditions:

(a) The party joining the causes of action shall comply with the rules

on joinder of parties;

(b) The joinder shall not include special civil actions or actions

governed by special rules;

(c) Where the causes of action are between the same parties but

pertain to different venues or jurisdictions, the joinder may be

allowed in the Regional Trial Court provided one of the causes of

action falls within the jurisdiction of said court and the venue lies

therein; and

(d) Where the claims in all the causes of action are principally for

recovery of money, the aggregate amount claimed shall be the test

of jurisdiction.

As far as can be gathered from the assailed Orders, it is the first

condition - on joinder of parties - that the trial court deemed to be

lacking. It is well to remember that the joinder of causes of action

may involve the same parties or different parties. If the joinder

involves different parties, as in this case, there must be a question offact or of law common to both parties joined, arising out of the

same transaction or series of transaction.19

In herein case, petitioners have adequately alleged in their

complaint that after they had already agreed to enter into a contract

to sell with Zescon Land, Inc., through Sales-Contreras, the latter

also gave them other documents to sign, to wit: A Deed of Absolute

Sale over the same properties but for a lower consideration, two

mortgage deeds over the same properties in favor of respondent

Hermano with accompanying notes and acknowledgment receipts

for Ten Million pesos (P10,000,000) each. Petitioners claim that

Zescon Land, Inc., through Sales-Contreras, misled them to

mortgage their properties which they had already agreed to sell to

the latter.

From the above averments in the complaint, it becomes reasonably

apparent that there are questions of fact and law common to both

Zescon Land, Inc., and respondent Hermano arising from a series of

transaction over the same properties. There is the question of fact,

for example, of whether or not Zescon Land, Inc., indeed misled

subsequently declared that what was entered into by petitio

and Zescon Land, Inc., was a Contract of Sale (as evidenced by

Deed of Absolute Sale signed by them) because this would m

that the contracts of mortgage were void as petitioners were

longer the absolute owners of the properties mortgaged. Fin

there is also the question of whether or not Zescon Land, Inc

represented by Sales-Contreras, and respondent Herm

committed fraud against petitioners as to make them liable

damages.

Prescinding from the foregoing, and bearing in mind that the joi

of causes of action should be liberally construed as to effect in

action a complete determination of all matters in controv

involving one subject matter, we hold that the trial court commi

grave abuse of discretion in severing from the complaint petition

cause of action against respondent Hermano.

WHEREFORE, premises considered, the Resolution of the Cou

Appeals dated 19 October 2000 dismissing petitioners’ petition

certiorari and its Resolution dated 02 March 2001 den

petitioners’ motion for reconsideration are REVERSED and

ASIDE. The petition for certiorari is hereby GRANTED. The Orde

the Regional Trial Court of Quezon City, Branch 224, dated

February 2000 and 25 May 2000 are ANNULLED and SET ASIDE.

RTC is further ordered to reinstate respondent Antonio Herman

one of the defendants in Civil Case No. Q-98-34211. No costs.

SO ORDERED.





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