THIRD DIVISION [G.R. No. 148126. November 10, 2003]

GEORGE T. VILLENA, CARLOS N. VILLENA, AURORA M. BONDOC and RONNIE C. FERNANDEZ, and their Respective Spouses, petitioners, vs. Spouses ANTONIO C. CHAVEZ and NOEMI MARCOS­CHAVEZ and CARLITA C. CHAVEZ,respondents.

D E C I S I O N PANGANIBAN, J.: Stare decisis simply means that a judgment reached in one case should be applied to successive ones in which the facts are substantially identical, even though the parties may be different. Like cases ought to be decided alike.

The Case Before this Court is a Petition for Review[1] under Rule 45 of the Rules of Court, assailing the May 9, 2001 Decision[2] of the Court of Appeals (CA) in CA­GR SP No. 58329. The decretal portion of the Decision reads as follows: WHEREFORE, the judgment dated March 29, 2000 of Branch 56 of the RTC of Angeles City is hereby REVERSED and SET ASIDE, and a new judgment entered in favor of the petitioners, ordering the respondents and all persons claiming rights under them to vacate from the subject lots and to remove their houses and/or any other structures or constructions thereon.[3]

The overturned Decision of the Regional Trial Court (RTC) of Angeles City, Branch 56,[4] affirmed in toto the Municipal Trial Court (MTC) of Angeles City, Branch II.[5]

The Facts The facts of the case are summarized by the CA in this wise: In a Complaint for Illegal Detainer with Damages filed on October 15, 1998, the [respondents] alleged that they are the owners of four (4) parcels of land designated as Lot Nos. 164, 165, 166, and 167 of the Cadastral Survey of Angeles City, and covered, respectively, by Transfer Certificates of Title Nos. 83247, 83246, 83248 and 83249, all issued by the Register of Deeds of Angeles City. These four (4) parcels of land have been consolidated and subdivided into several blocks and lots, and are now collectively designated asBagong Silang Phase III­C. By mere permission and tolerance of the [respondents], the [petitioners] have occupied and erected their homes on four (4) of the said lots, as follows: George T. Villena and wife = Block 5, Lot 14 Carlos N. Villena and wife = Block 5, Lot 13 Aurora M. Bondoc and husband = Block 2, Lot 4 Ronnie C. Hernandez and wife = Block 3, Lot 5 All the [petitioners] are members of the Bagong Silang Phase III­C Homeowners Association, Inc., with office address at Cutud, Angeles City. The [respondents] allowed the [petitioners] and other members of the said homeowners association to continue occupying the subject lots and ultimately to acquire ownership of the lots occupied, in consideration of a certain amount to be paid to the [respondents] as equity. The [respondents] further alleged that the other members of the said homeowners association paid to the [respondents] their respective equity for their right to continue occupying and ultimately acquiring ownership of the occupied lots. However, notwithstanding repeated demands made upon the [petitioners], they have refused and failed without any justifiable ground to pay their respective equity. In view of such failure to pay, the [petitioners] have forfeited their right to continue occupying the lots in question. Formal demand letters were then sent by registered mail to the [petitioners], wherein they were given a period of thirty (30) days from receipt within which to vacate and remove their houses from the subject lots. The period given to the [petitioners] lapsed on April 11, 1998, but up to the present time, the [petitioners] refused and failed without any justifiable reason or ground to vacate and remove their houses from the said lots. The [respondents] then prayed in their Complaint that the [petitioners] be ordered to vacate and remove their houses from the lots currently occupied; that each of the [petitioners] be ordered to pay the [respondents] P1,000.00 a month as reasonable rental for the use and occupation of the lots starting from April 11, 1998 until they have finally vacated and removed their houses from said lots; and that the [petitioners] jointly and severally pay the [respondents] P25,000.00 as actual and compensatory damages, P2,000.00 as appearance fee per hearing, exemplary damages, and the costs of the suit. In their answer with compulsory counter­claim filed on November 3, 1998, the [petitioners] countered that the [respondents] have no cause of action to institute the present action, considering that the properties in question are under the community mortgage program implemented by the National Home Mortgage Finance Corporation. Moreover, the [petitioners] claimed that they are lawful tenants of the premises, and that they have been paying their equity to their originator, the Urban Land and Development Foundation[,] Inc. However, they were not issued the corresponding receipts evidencing payment and a copy of their contract. The [petitioners] further averred that they were willing to continue paying their equity until the same shall have been fully paid, but their originator, without justifiable reason, refused to accept the tender of payment made by them. The [petitioners] subsequently agreed with their originator that the payment of equity should be continued only upon the release of a Purchase Commitment Line (PCL).

In addition, the [petitioners] alleged that they are qualified beneficiaries under Republic Act No. 7279, otherwise known as the Urban Development and Housing Act of 1992; hence, they cannot be summarily evicted and their dwelling houses demolished unless and until they have been relocated. According to the [petitioners], they are also builders in good faith and should be indemnified for the improvements they constructed on the properties in question. The [petitioners] prayed in their answer that the complaint be dismissed; that they be declared lawful tenants and qualified beneficiaries under R.A. 7279; that the [respondents] be ordered to sell the lots in question to them, and to pay attorneys fees and the costs of suit. After the pre­trial conference, both parties submitted their position papers. On September 15, 1999, MTC Branch II of Angeles City rendered a decision dismissing both the [respondents] complaint and the [petitioners] counter­claim, on the ground that the filing of an ejectment case based on the alleged violation of the parties agreement which has not yet been rescinded is premature, and that it is beyond the competence of the said court to act on the case, as rescission or specific performance is beyond the jurisdiction of the said court. The [respondents] appealed such adverse judgment to the RTC of Angeles City, which appeal was raffled to Branch 56 of the said court. On March 29, 2000, RTC Branch 56 of Angeles City rendered a decision affirming in toto the MTC judgment.[6]

Ruling of the Court of Appeals The CA held that the right of petitioners to continue occupying the subject properties hinged on their continued payment of the agreed amount as equity.[7]Even after formal letters of demand to vacate the premises had been sent to them, however, they still did not make any effort to pay their equity to protect their right to continue occupying those lots. Thus, the appellate court ruled that their failure to pay made their occupancy unlawful, in consequence of which they became subject to an ejectment suit. The CA rejected the contention of petitioners that they were protected by RA 7279. According to the appellate court, there was no express declaration by the local government unit that the parcels of land owned by respondents were to be used for socialized housing. Neither was there proof of the allegation that they had applied therefor under the Community Mortgage Program of the National Home Mortgage Finance Corporation under Section 31 of RA 7279. Besides, even granting that petitioners were protected under RA 7279, they were still liable to pay amortization or face eviction. Likewise debunked was the allegation of petitioners that respondents were not the real parties in interest. Being the owners of the lots occupied by the former, the latter had a material interest in the suit and stood to be benefited or injured by any judgment affecting those parcels of land. Hence, this Petition.[8]

The Issues Petitioners raise the following issues for our consideration: I. Whether or not the Honorable Court of Appeals committed grave abuse of discretion amounting to lack or excess of jurisdiction in reversing and setting aside the Decisions of the Municipal Trial Court, Branch II and of the Regional Trial Court, Branch 56 both of Angeles City[;] II. Whether or not the Honorable Municipal Trial Court has jurisdiction over the case; III. Whether or not the non­inclusion of the Bagong Silang Homeowners Association Inc., is fatal to respondents[] cause of action[;] IV. Whether or not ejectment is proper in the case at bar; V. Whether or not the absence of contractual relation[s] between the respondents and the petitioners bar[s] the filing of any action by the respondents against the petitioner.[9]

The primordial issue to be resolved is whether unlawful detainer is the proper action to resolve this case. If it is, then the MTC indeed had jurisdiction over the case, and the CA was correct in overturning the RTCs ruling that the MTC had no jurisdiction over the case.

The Courts Ruling The Petition is meritorious.

Main Issue: Propriety of Unlawful Detainer

The CA ruled that petitioners possession or occupancy of the subject premises was by mere tolerance of respondents. Hence, once petitioners failed to pay the agreed amount as equity, their right to continue occupying the lots was lost. We disagree. Contradictory were the statements of the appellate court that, on the one hand, there was no contract between the parties; and yet, on the other, that petitioners failed to pay theagreedequity. The fact that the CA found that there was failure to pay the equity was an indication of an agreement. To be sure, petitioners possession of the subject premises was not by mere tolerance of respondents. In the Complaint[10] of respondents, filed before Branch II of the Municipal Trial Court of Angeles City, they themselves alleged the presence of an agreement between the parties as follows: 10. That in consideration of a certain amount to be paid to the [respondents] by each of the [petitioners] as equity for their right to continue occupying and ultimately acquire ownership of the lots that they occupy, the said homeowners association has made arrangements with the

[respondents] to allow the [petitioners] and other members of the said homeowners association to continue occupying and ultimately acquire ownership of the lots that they occupy[.][11]

Further, in the Special Power of Attorney[12] annexed to their Complaint, they constituted and appointed Teodorico B. Sanchez and/or Arturo M. Yadan as their attorneys­in­fact to do, among others, the following: 1. To collect and receive any amount or amounts as equity for the sale thereof to them from the occupants or any other interested buyer or buyers of any portion or portions of the following­described parcels of land: xxx xxx xxx of which we are the absolute and exclusive owners, and which comprise the parcels of land being acquired by the members or beneficiaries of the BAGONG SILANG PHASE III­C HOMEOWNERS ASSOCIATION, at Brgy. Cutud, Angeles City[.][13]

Based on the admissions of respondents themselves, they entered into an agreement with petitioners. Necessarily, the latters occupancy of the lots in question was not based merely on the formers tolerance or permission. Thus, petitioners were not necessarily bound by an implied promise to vacate upon demand, failing which, a summary action for ejectment would have become proper. The MTCs findings of fact on this point are instructive: About the only thing that the parties have met on a common ground is that: [Respondents] have entered into an arrangement/agreement with Bagong Silang Homeowners Association, Inc. that called for the payment of certain amounts as equity for [petitioners] right to continue occupying the lots with the end in view of eventually becoming the owners thereof, that pursuant to such agreement [petitioners] have paid certain amounts as acquisition fees or as equity but later discontinued making payments in view of the non­issuance of the so­called purchase commitment line/loan, and as a consequence, [respondents] are now accusing [petitioners] for violating the agreement and on the basis of such breach of the agreement by [petitioners], demands for the latter to vacate the lots were made by [respondents].[14]

When respondents alleged that the Bagong Silang Phase III­C Homeowners Association made arrangements with them to allow petitioners and other members of the association to continue to occupy and ultimately to acquire ownership of the lots in question, respondents explicitly admitted that a contract had indeed been entered into. The eventual transfer of ownership of real property evidenced that obligation. What is clear is that in their Complaint, respondents alleged that petitioners had violated the stipulations of their agreement as follows: 11. That the other members of the Ba[g]ong Silang Phase III­C Homeowners Association, Inc., paid to the [respondents] their respective equity for their right to continue occupying and ultimately acquire ownership of the lots that they occupy, but notwithstanding repeated demands made on them, up to the present time, the [petitioners] have refused and failed without any justifiable ground or reason to pay their respective equity to the [respondents], and, in view of such refusal and failure, the [petitioners] have forfeited their right to continue occupying and ultimately acquire ownership of the lots that they occupy[.][15]

Petitioners, on the other hand, denied any breach on their part and argued that the principal issue was one of interpretation, enforcement and/or rescission of the contract. Under these circumstances, proof of violation of the provisions of the contract is a condition precedent to resolution or rescission.[16] The contract can be declared rescinded only when its nature has been clarified and the eventual violation thereof, if any, has been established. Upon such rescission, in turn, hinges a pronouncement that the possession of the realty has become unlawful. Thus, the basic issue is not possession but interpretation, enforcement and/or rescission of the contract ­­ a matter that is beyond the jurisdiction of the Municipal Trial Court to hear and determine. An allegation of a violation of a contract or agreement in a detainer suit may be proved by the presentation of competent evidence, upon which an MTC judge might make a finding to that effect. But certainly, that court cannot declare and hold that the contract is rescinded, as such power is vested in the RTC.[17]

The rescission of the contract is the basis of, and therefore a condition precedent for, the illegality of a partys possession of a piece of realty.[18] Without judicial intervention and determination, even a stipulation entitling one party to take possession of the land and building in case the other party violates the contract cannot confer upon the former the right to take possession thereof, if that move is objected to.[19]

To be sure, the jurisdiction of a court is determined by the allegations in the complaint.[20] Thus, in ascertaining whether or not an action is one for unlawfuldetainer falling within the exclusive jurisdiction of the inferior courts, the averments of the complaint and the character of the relief sought should be examined. Also, as correctly pleaded by petitioners, a similar case had been decided by the CA in CA­GR SP No. 58679, in which it ruled that the proper action should have been a complaint for rescission or specific performance, not for illegal detainer. In that case, the same plaintiffs filed the same charges against a different but similarly situated set of defendants. The appellate court ruled therein that there was an existing agreement or contract that determined the nature of the parties relationship.[21] Thus, it held that the proper action should have been for rescission of contract or specific performance, not unlawful detainer.[22] When the CA Decision was elevated, this Court denied the appeal for failure to show that a reversible error had been committed by the appellate court. Thereafter, the Decision became final and executory onApril 23, 2002.[23]

Said the appellate court in the previous case: Inasmuch as the relationship existing between the parties is not a lessor­lessee relationship but one that emanated from the agreement between appellants and the Urban Landand Development Foundation, Inc., the so­called originator of the Bagong Silang Homeowners Association, Inc., the relief being sought then by appellants appears to be improper. If ever there was no payment of equity as provided for under the said agreement, the same cannot be considered as non­payment of rentals. Thus, it cannot be a sufficient basis for filing an ejectment case against appellees, the proper remedy being an action for rescission of contract or specific performance.[24]

We stress that when a court has laid down a principle of law as applicable to a certain state of facts, it will adhere to that principle and apply it to all future cases in which the facts are substantially the same.[25] Stare decisis et non quieta movere.Stand by the decisions and disturb not what is settled. Stare decisissimply means that for the sake of certainty, a conclusion reached in one case should be applied to those that follow if the facts are substantially the same, even though the parties may be different.[26] It proceeds from the first principle of justice that, absent any powerful countervailing considerations, like cases ought to be decided alike.[27]

Having ruled that the MTC had indeed no jurisdiction to take cognizance of this case in the first place, we see no more need to address the other issues raised by petitioners. WHEREFORE, the Petition is hereby GRANTED and the assailed Decision of the Court of Appeals is OVERTURNED. Consequently, the Decisions of the MTC and the RTC of Angeles City are REINSTATED. No pronouncement as to costs. SO ORDERED. Puno, (Chairman), Sandoval­Gutierrez, Corona, and Carpio­Morales, JJ., concur.

SECOND DIVISION [G.R. No. 102737. August 21, 1996]

FRANCISCO A. VELOSO, petitioner, vs. COURT OF APPEALS, AGLALOMA B. ESCARIO, assisted by her husband GREGORIO L. ESCARIO, the REGISTER OF DEEDS FOR THE CITY OF MANILA, respondents.

D E C I S I O N TORRES, JR., J.: This petition for review assails the decision of the Court of Appeals, dated July 29, 1991, the dispositive portion of which reads: WHEREFORE, the decision appealed from is hereby AFFIRMED IN TOTO. Costs against appellant.[1]

The following are the antecedent facts: Petitioner Francisco Veloso was the owner of a parcel of land situated in the district of Tondo, Manila, with an area of one hundred seventy seven (177) square meters and covered by Transfer Certificate of Title No. 49138 issued by the Registry of Deeds of Manila.[2] The title was registered in the name of Francisco A. Veloso, single,[3] on October 4, 1957.[4] The said title was subsequently canceled and a new one, Transfer Certificate of Title No. 180685, was issued in the name of Aglaloma B. Escario, married to Gregorio L. Escario, on May 24, 1988.[5]

On August 24, 1988, petitioner Veloso filed an action for annulment of documents, reconveyance of property with damages and preliminary injunction and/or restraining order.The complaint, docketed as Civil Case No. 88­45926, was raffled to the Regional Trial Court, Branch 45, Manila. Petitioner alleged therein that he was the absolute owner of the subject property and he never authorized anybody, not even his wife, to sell it. He alleged that he was in possession of the title but when his wife, Irma, left for abroad, he found out that his copy was missing. He then verified with the Registry of Deeds of Manila and there he discovered that his title was already canceled in favor of defendant Aglaloma Escario. The transfer of property was supported by a General Power of Attorney[6] dated November 29, 1985 and Deed of Absolute Sale, dated November 2, 1987, executed by Irma Veloso, wife of the petitioner and appearing as his attorney­in­fact, and defendant Aglaloma Escario.[7] Petitioner Veloso, however, denied having executed the power of attorney and alleged that his signature was falsified. He also denied having seen or even known Rosemarie Reyes and Imelda Santos, the supposed witnesses in the execution of the power of attorney. He vehemently denied having met or transacted with the defendant. Thus, he contended that the sale of the property, and the subsequent transfer thereof, were null and void. Petitioner Veloso, therefore, prayed that a temporary restraining order be issued to prevent the transfer of the subject property; that the General Power of Attorney, the Deed of Absolute Sale and the Transfer Certificate of Title No. 180685 be annulled; and the subject property be reconveyed to him. Defendant Aglaloma Escario in her answer alleged that she was a buyer in good faith and denied any knowledge of the alleged irregularity. She allegedly relied on the general power of attorney of Irma Veloso which was sufficient in form and substance and was duly notarized. She contended that plaintiff (herein petitioner), had no cause of action against her. In seeking for the declaration of nullity of the documents, the real party in interest was Irma Veloso, the wife of the plaintiff. She should have been impleaded in the case. In fact, Plaintiffs cause of action should have been against his wife, Irma. Consequently, defendant Escario prayed for the dismissal of the complaint and the payment to her of damages.[8]

Pre­trial was conducted. The sole issue to be resolved by the trial court was whether or not there was a valid sale of the subject property.[9]

During the trial, plaintiff (herein petitioner) Francisco Veloso testified that he acquired the subject property from the Philippine Building Corporation, as evidenced by a Deed of Sale dated October 1, 1957.[10] He married Irma Lazatin on January 20, 1962.[11] Hence, the property did not belong to their conjugal partnership. Plaintiff further asserted that he did not sign the power of attorney and as proof that his signature was falsified, he presented Allied Bank Checks Nos. 16634640, 16634641 and 16634643, which allegedly bore his genuine signature. Witness for the plaintiff Atty. Julian G. Tubig denied any participation in the execution of the general power of attorney. He attested that he did not sign thereon, and the same was never entered in his Notarial Register on November 29, 1985. In the decision of the trial court dated March 9, 1990,[12] defendant Aglaloma Escaro was adjudged the lawful owner of the property as she was deemed an innocent purchaser for value. The assailed general power of attorney was held to be valid and sufficient for the purpose. The trial court ruled that there was no need for a special power of attorney when the special power was already mentioned in the general one. It also declared that plaintiff failed to substantiate his allegation of fraud. The court also stressed that plaintiff was not entirely blameless for although he admitted to be the only person who had access to the title and other important documents, his wife was still able to possess the copy. Citing Section 55 of Act 496, the court held that Irmas possession and production of the certificate of title was deemed a conclusive authority from the plaintiff to the Register of Deeds to enter a new certificate. Then applying the principle of equitable estoppel, plaintiff was held to bear the loss for it was he who made the wrong possible. Thus: WHEREFORE, the Court finds for the defendants and against plaintiff­ a. declaring that there was a valid sale of the subject property in favor of the defendant; b. denying all other claims of the parties for want of legal and factual basis. Without pronouncement as to costs. SO ORDERED. Not satisfied with the decision, petitioner Veloso filed his appeal with the Court of Appeals. The respondent court affirmedin toto the findings of the trial court. Hence, this petition for review before us. This petition for review was initially dismissed for failure to submit an affidavit of service of a copy of the petition on the counsel for private respondent.[13] A motion for reconsideration of the resolution was filed but it was denied in a resolution dated March 30, 1992.[14] A second motion for reconsideration was filed and in a resolution dated Aug. 3, 1992, the motion was granted and the petition for review was reinstated.[15]

A supplemental petition was filed on October 9, 1992 with the following assignment of errors: I

The Court of Appeals committed a grave error in not finding that the forgery of the power of attorney (Exh. C) had been adequately proven, despite the preponderant evidence, and in doing so, it has so far departed from the applicable provisions of law and the decisions of this Honorable Court, as to warrant the grant of this petition for review on certiorari.

II There are principles of justice and equity that warrant a review of the decision.

III The Court of Appeals erred in affirming the decision of the trial court which misapplied the principle of equitable estoppel since the petitioner did not fail in his duty of observing due diligence in the safekeeping of the title to the property. We find petitioners contentions not meritorious. An examination of the records showed that the assailed power of attorney was valid and regular on its face. It was notarized and as such, it carries the evidentiary weight conferred upon it with respect to its due execution. While it is true that it was denominated as a general power of attorney, a perusal thereof revealed that it stated an authority to sell, to wit: 2. To buy or sell, hire or lease, mortgage or otherwise hypothecate lands, tenements and hereditaments or other forms of real property, more specifically TCT No. 49138, upon such terms and conditions and under such covenants as my said attorney shall deem fit and proper.[16]

Thus, there was no need to execute a separate and special power of attorney since the general power of attorney had expressly authorized the agent or attorney in fact the power to sell the subject property. The special power of attorney can be included in the general power when it is specified therein the act or transaction for which the special power is required. The general power of attorney was accepted by the Register of Deeds when the title to the subject property was canceled and transferred in the name of private respondent. In LRC Consulta No. 123, Register of Deeds of Albay, Nov. 10, 1956, it stated that: Whether the instrument be denominated as general power of attorney or special power of attorney, what matters is the extent of the power or powers contemplated upon the agent or attorney in fact. If the power is couched in general terms, then such power cannot go beyond acts of administration. However, where the power to sell is specific, it not being merely implied, much less couched in general terms, there can not be

any doubt that the attorney in fact may execute a valid sale. An instrument may be captioned as special power of attorney but if the powers granted are couched in general terms without mentioning any specific power to sell or mortgage or to do other specific acts of strict dominion, then in that case only acts of administration may be deemed conferred. Petitioner contends that his signature on the power of attorney was falsified. He also alleges that the same was not duly notarized for as testified by Atty. Tubig himself, he did not sign thereon nor was it ever recorded in his notarial register. To bolster his argument, petitioner had presented checks, marriage certificate and his residence certificate to prove his alleged genuine signature which when compared to the signature in the power of attorney, showed some difference. We found, however, that the basis presented by the petitioner was inadequate to sustain his allegation of forgery. Mere variance of the signatures cannot be considered as conclusive proof that the same were forged. Forgery cannot be presumed.[17] Petitioner, however, failed to prove his allegation and simply relied on the apparent difference of the signatures. His denial had not established that the signature on the power of attorney was not his. We agree with the conclusion of the lower court that private respondent was an innocent purchaser for value. Respondent Aglaloma relied on the power of attorney presented by petitioners wife, Irma. Being the wife of the owner and having with her the title of the property, there was no reason for the private respondent not to believe in her authority. Moreover, the power of attorney was notarized and as such, carried with it the presumption of its due execution.Thus, having had no inkling on any irregularity and having no participation thereof, private respondent was a buyer in good faith. It has been consistently held that a purchaser in good faith is one who buys property of another, without notice that some other person has a right to, or interest in such property and pays a full and fair price for the same, at the time of such purchase, or before he has notice of the claim or interest of some other person in the property.[18]

Documents acknowledged before a notary public have the evidentiary weight with respect to their due execution. The questioned power of attorney and deed of sale, were notarized and therefore, presumed to be valid and duly executed. Atty. Tubig denied having notarized the said documents and alleged that his signature had also been falsified. He presented samples of his signature to prove his contention. Forgery should be proved by clear and convincing evidence and whoever alleges it has the burden of proving the same. Just like the petitioner, witness Atty. Tubig merely pointed out that his signature was different from that in the power of attorney and deed of sale. There had never been an accurate examination of the signature, even that of the petitioner. To determine forgery, it was held in Cesarvs. Sandiganbayan[19] (quoting Osborn, The Problem of Proof) that: The process of identification, therefore, must include the determination of the extent, kind, and significance of this resemblance as well as of the variation. It then becomes necessary to determine whether the variation is due to the operation of a different personality, or is only the expected and inevitable variation found in the genuine writing of the same writer. It is also necessary to decide whether the resemblance is the result of a more or less skillful imitation, or is the habitual and characteristic resemblance which naturally appears in a genuine writing. When these two questions are correctly answered the whole problem of identification is solved. Even granting for the sake of argument, that the petitioners signature was falsified and consequently, the power of attorney and the deed of sale were null and void, such fact would not revoke the title subsequently issued in favor of private respondent Aglaloma. In the case of Tenio­Obsequio vs. Court of Appeals,[20] it was held, viz.: The right of an innocent purchaser for value must be respected and protected, even if the seller obtained his title through fraud. The remedy of the person prejudiced is to bring an action for damages against those who caused or employed the fraud, and if the latter are insolvent, an action against the Treasurer of the Philippines may be filed for recovery of damages against the Assurance Fund. Finally, the trial court did not err in applying equitable estoppel in this case. The principle of equitable estoppel states that where one or two innocent persons must suffer a loss, he who by his conduct made the loss possible must bear it. From the evidence adduced, it should be the petitioner who should bear the loss. As the court a quo found: Besides, the records of this case disclosed that the plaintiff is not entirely free from blame. He admitted that he is the sole person who has access to TCT No. 49138 and other documents appertaining thereto (TSN, May 23, 1989, pp. 7­12). However, the fact remains that the Certificate of Title, as well as other documents necessary for the transfer of title were in the possession of plaintiffs wife, Irma L. Veloso, consequently leaving no doubt or any suspicion on the part of the defendant as to her authority. Under Section 55 of Act 496, as amended, Irmas possession and production of the Certificate of Title to defendant operated as conclusive authority from the plaintiff to the Register of Deeds to enter a new certificate.[21]

Considering the foregoing premises, We found no error in the appreciation of facts and application of law by the lower court that will warrant the reversal or modification of the appealed decision. ACCORDINGLY, the petition for review is hereby DENIED for lack of merit. SO ORDERED. Regalado (Chairman), Romero, Puno, and Mendoza, JJ., concur.

THIRD DIVISION [G.R. No. 107846. April 18, 1997]

LEOVILLO C. AGUSTIN, petitioner, vs. COURT OF APPEALS and FILINVEST FINANCE CORP., respondents. R E S O L U T I O N

FRANCISCO, J.: This is an appeal by certiorari from the decision of respondent Court of Appeals in CA­G.R. No. 24684[1] which affirmed the order of Regional Trial Court, Branch 40, Manila, in Civil Case No. 84804.[2]

The dispute stemmed from an unpaid promissory note dated October 28, 1970, executed by petitioner Leovillo C. Agustin in favor of ERM Commercial for the amount of P43,480.80. The note was payable in monthly installments[3] and secured by a chattel mortgage over an Isuzu diesel truck,[4] both of which were subsequently assigned to private respondent Filinvest Finance Corporation.[5] When petitioner defaulted in paying the installments, private respondent demanded from him the payment of the entire balance or, in lieu thereof, the possession of the mortgaged vehicle. Neither payment nor surrender was made.Aggrieved, private respondent filed a complaint with the Regional Trial Court of Manila, Branch 26 (RTC Branch 26) against petitioner praying for the issuance of a writ of replevin or, in the alternative, for the payment of P32,723.97 plus interest at the rate of 14% per annum from due date until fully paid.[6] Trial ensued and, thereafter, awrit of replevin was issued by RTC Branch 26. By virtue thereof, private respondent acquired possession of the vehicle. Upon repossession, the latter discovered that the vehicle was no longer in running condition and that several parts were missing which private respondent replaced. The vehicle was then foreclosed and sold at public auction. Private respondent subsequently filed a supplemental complaint claiming additional reimbursement worth P8,852.76 as value of replacement parts[7] and for expenses incurred in transporting the mortgaged vehicle from Cagayan to Manila. In response, petitioner moved to dismiss the supplemental complaint arguing that RTC Branch 26 had already lost jurisdiction over the case because of the earlier extra­judicial foreclosure of the mortgage. The lower court granted the motion and the case was dismissed.[8] Private respondent elevated the matter to the appellate court, docketed as CA­G.R. No. 56718­R, which set aside the order of dismissal and ruled that repossession expenses incurred by private respondent should be reimbursed.[9] This decision became final and executory, hence the case was accordingly remanded to the Regional Trial Court of Manila, Branch 40 (RTC Branch 40) for reception of evidence to determine the amount due from petitioner.[10] After trial, RTC Branch 40 found petitioner liable for the repossession expenses, attorney's fees, liquidated damages, bonding fees and other expenses in the seizure of the vehicle in the aggregate sum of P18,547.38. Petitioner moved for reconsideration. Acting thereon, RTC Branch 40 modified its decision by lowering the monetary award to P8,852.76, the amount originally prayed for in the supplemental complaint.[11] Private respondent appealed the case with respect to the reduction of the amount awarded. Petitioner, likewise, appealed impugning the trial courts order for him to pay private respondentP8,852.76, an amount over and above the value received from the foreclosure sale. Both appeals were consolidated and in CA­ G.R. No. 24684, the modified order of RTC Branch 40 was affirmed. Petitioner filed a motion for reconsideration, but to no avail[12] Hence, this petition for review on certiorari. Petitioner contends that the award of repossession expenses to private respondent as mortgagee is "contrary to the letter, intent and spirit of Article 1484[13]of the Civil Code".[14] He asserts that private respondents repossession expenses have been amply covered by the foreclosure of the chattel mortgage, hence he could no longer be held liable. The arguments are devoid of merit. Petitioners contentions, we note, were previously rejected by respondent court in its decision in CA­G.R. No. 56718­R the dispositive portion of which provides as follows: "WHEREFORE, the order dismissing the case is hereby set aside and the case is remanded to the lower court for reception of evidence of `expenses properly incurred in effecting seizure of the chattel (and) of recoverable attorney's fees in prosecuting the action for replevin' as `repossession expenses' prayed for in the supplemental complaint,without pronouncement as to costs."[15]

which ruling has long acquired finality. It is clear, therefore, that the appellate court had already settled the propriety of awarding repossession expenses in favor of private respondent. The remand of the case to RTC Branch 40 was for the sole purpose of threshing out the correct amount of expenses and not for relitigating the accuracy of the award. Thus, the findings of RTC Branch 40, as affirmed by the appellate court in CA­G.R. No. 24684, was confined to the appreciation of evidence relative to the repossession expenses for the query or issue passed upon by the respondent court in CA­G.R. No. 56718­R (propriety of the award for repossession expenses) has become the law of the case. This principle is defined as a term applied to an established rule that when an appellate court passes on a question and remands the cause to the lower court for further proceedings, the question there settled becomes the law of the case upon subsequent appeal.[16] Having exactly the same parties and issues, the decision in the former appeal (CA­G.R. No. 56718­R) is now the established and controlling rule. Petitioner may not therefore be allowed in a subsequent appeal (CA­G.R. No. 24684) and in this petition to resuscitate and revive formerly settled issues. Judgment of courts should attain finality at some point in time, as in this case, otherwise, there will be no end to litigation.

At any rate, even if we were to brush aside the law of the case doctrine we find the award for repossession expenses still proper. InFilipinas Investment & Finance Corporation v. Ridad,[17] the Court recognized an exception to the rule stated under Article 1484(3) upon which petitioner relies. Thus: x x x Where the mortgagor plainly refuses to deliver the chattel subject of the mortgage upon his failure to pay two or more installments, or if he conceals the chattel to place it beyond the reach of the mortgagee, what then is the mortgagee expected to do? x x x It logically follows as a matter of common sense, that the necessary expenses incurred in the prosecution by the mortgagee of the action for replevin so that he can regain possession of the chattel, should be borne by the mortgagor. Recoverable expenses would, in our view, include expenses properly incurred in effecting seizure of the chattel and reasonable attorneys fees in prosecuting the action for replevin.[18]

Anent the denial of the award for attorneys fees, we find the same in order. The trial court, as well as respondent court, found no evidence to support the claim for attorney's fees which factual finding is binding on us.[19] We find no compelling reason, and none was presented, to set aside this ruling. ACCORDINGLY, the petition is DENIED for lack of merit, and the decision of the Court of Appeals is hereby AFFIRMED in toto. SO ORDERED. Narvasa, C.J. (Chairman), Davide, Jr., Melo, and Panganiban, JJ., concur.

FIRST DIVISION [G.R. Nos. 153063­70. August 19, 2005]

AMELIA D. DE MESA, ARACELI ADATO, RODRIGO ALVARAN, AIDA CASTRO, BALTAZAR ESTRELLES, ANTONIO A. FERRER, DANILO GARCIA, JULIO M. GONZALES, MARRIETA A. JOSE, PEPITA JUNTADO, EDUARDO U. LAGO, NESTOR RODA, JAIME SANCHEZ and JUANITA SANCHEZ, petitioners, vs. PEPSI COLA PRODUCTS PHILS., INC. and PEPSICO INC.,respondents.

R E S O L U T I O N QUISUMBING, J.: For review on certiorari is the Order,[1] dated April 18, 2002, of the Regional Trial Court of Makati City, Branch 142 in Civil Cases Nos. 94­2414 to 94­2421. In the said Order, the RTC granted herein respondents motion to dismiss the complaints filed by petitioners herein based on the principle of stare decisis. The instant case arose from the same set of facts as (1)Mendoza v. Pepsi­Cola Products Philippines, Inc., et al., G.R. No. 153183 promulgated on July 24, 2002[2] affirming the Court of Appeals Decision, dated April 16, 2002, in CA­G.R. CV No. 53860;[3] and (2) Rodrigo v. Pepsi Cola Products (Phils.), Inc. and Pepsico, Inc., G.R. No. 149411, dated October 1, 2001, which also affirmed the Court of AppealsDecision of May 21, 2001 in CA­G.R. CV No. 62837.[4]

The facts are culled from the aforesaid Decisions of the Court of Appeals as affirmed by this Court. Petitioners are holders of soft drink bottle caps bearing the number 349, allegedly a winning combination in a contest sponsored by respondents Pepsi Cola Products Phils., Inc. (PCPPI) and PEPSICO, Inc. (PI). Respondent PCPPI is a domestic corporation engaged in the production, bottling, and distribution of carbonated drinks, while respondent PI is a foreign corporation licensed to do business in the Philippines and is the major stockholder of PCPPI. D.G. Consultores, a Mexican consulting firm that handled similar promotions in other countries, was tasked to randomly pre­select the winning numbers and send to respondents a list of the 60 winning numbers with their corresponding security codes. The process of selecting the winning numbers was implemented with the approval of the Department of Trade and Industry (DTI). During the initial promotion period, from February 17 to May 8, 1992, respondents seeded 1000 numbers, 60 of which were winning numbers, 510 non­winning numbers, while the remaining 430 were unused. To ensure that the winning numbers would not be tampered, the DTI required respondents to submit the list of winning numbers including their security codes which was then deposited in a safety deposit box in a bank.[5]

Owing to the promotional campaigns success, respondents extended the Number Fever by five more weeks, from May 10 to June 12, 1992. Pepsi again tapped D.G. Consultores to predetermine the 25 additional winning numbers from the list of unused numbers. On May 25, 1992, respondents announced 349 as the winning number for the May 26 draw. Later the same night, Quintin Gomez, Jr., then PCPPIs Marketing Services Manager called DTI Director Madarang informing her that due to some security code problems a mistake had been made in the announcement of number 349 as the winning number.[6]

Numerous holders of the supposedly winning 349 crowns were not honored and paid by respondents, which led these rejected crown holders to file separate complaints for specific performance and damages. Civil Case No. 93­68351 was originally filed before the Regional Trial Court of Manila, Branch 16, but the plaintiffs in the said case withdrew their complaint, leaving Gerson Mendoza as the sole plaintiff inGerson M. Mendoza v. Pepsi­Cola Products Phils., Inc. and Pepsico, Inc.[7] The other

plaintiffs re­filed their complaints before the Regional Trial Court of Manila, Branch 50, entitled Romulo Rodrigo, et al. v. Pepsi Cola Products Philippines, Inc., et al., docketed as Civil Case No. 94­71403.[8]

For their part, petitioners herein filed their separate complaints, docketed as Civil Cases Nos. 94­2414 to 94­2421, before the Regional Trial Court of Makati, Branch 142. In the Mendoza case, the RTC dismissed the complaint filed against herein respondents for specific performance and damages in connection with the Number Fever fiasco.[9] Mendoza appealed to the Court of Appeals, in CA­G.R. CV No. 53860, which was dismissed for lack of merit.[10] Unfazed, Mendoza filed with this Court a petition for review, which was denied for failure to sufficiently show that the Court of Appeals committed any reversible error.[11]

In the Rodrigo case, the RTC likewise dismissed the complaint against herein respondents for specific performance and damages arising from the said promotion.[12] On appeal, docketed as CA­G.R. CV No. 62837, the Court of Appeals affirmed the RTC decision.[13] A petition for review was subsequently filed with this Court, which was denied for failure to show that a reversible error was committed by the appellate court. The motion for reconsideration was also denied with finality[14] and entry of judgment was made.[15]

However, prior to the resolution of the Mendoza and Rodrigo cases, herein petitioners filed with the RTC, on December 11, 2000, a motion for leave[16] to (1) adopt the previous testimonial and documentary evidence in the Mendoza and Rodrigo cases; or (2) archive the case until final resolution of the said two cases, which were then pending with the Court of Appeals. The RTC granted the said motion on January 8, 2001 and the case was accordingly archived.[17]

Meantime, the Rodrigo case became final and executory on February 5, 2002 in view of our denial of therein petitioners petition for review on certiorari and motion for reconsideration. Hence, on February 20, 2002, herein respondents filed with the RTC a motion to dismiss[18] the complaints filed by petitioners herein invoking the principle of stare decisis. The RTC, in its assailed Order,[19] granted the motion to dismiss ratiocinating as follows: The Court finds the instant motion meritorious under the principle of stare decisis. The said doctrine embodies the legal maxim that a principle or rule of law which has been established by the decision of a court of controlling jurisdiction will be followed in other cases involving similar situation. It is founded on the necessity for securing certainty and stability in the law and does not require identity or privy of parties. This is explicitly ordained in Article 8 of the Civil Code which provides that decisions applying or interpreting the laws or the Constitution shall form part of the legal system. Such decisions assume the same authority as the statute itself and, until authoritatively abandoned, necessarily become, to the extent that they are applicable, the criteria which must control the actuations not only of those called upon to abide thereby but also of those in duty bound to enforce obedience thereto (Kilosbayan, Inc. et al. vs. Manuel Morato, G.R. No. 118910, July 17, 1995). In the instant cases as well as in Civil Case No. 93­68351 (the Mendoza case), not only are the legal rights and relations of the parties substantially the same as those passed upon in Civil Case No. 94­71403 (the Rodrigo case), but the facts, the applicable laws, the causes of action, the issues, and the testimonial and documentary evidence are identical such that a ruling in one case, i.e. the Rodrigo case in Civil Case No. 94­71403, under the rule of stare decisis, is a bar to any attempt to relitigate the same issue.[20]

Petitioners now come to us in this petition for review claiming that (1) the principle of res judicata does not apply; and (2) the dismissal of the complaint was premature as petitioners motion to archive the case and the grant thereof was based on the condition that there be a final resolution in the Mendoza andRodrigo cases.[21]

Simply put, the sole issue is whether the present case is barred by this Courts ruling in the Mendoza and Rodrigo cases. Petitioners contend that res judicata does not apply as there is no identity of parties to begin with. Moreover, they argue thatstare decisis is not a hard and fast rule. They insist another review should be taken on the cause of action in this case because the Court of Appeals, in the Mendoza and Rodrigo cases, erred in ruling that the security code determines the real winning crowns. They claim that the trial courts dismissal of their complaint was premature. Lastly, petitioners posit that there was a breached contract between the parties; therefore, respondents should be made to perform their contractual obligation. For their part, respondents counter that the RTC correctly dismissed petitioners complaint on the ground ofres judicata. Respondents contend that, like theMendoza and Rodrigo cases, the civil cases filed by petitioners arose from the conduct of respondents Number Fever promotion. Petitioners causes of action, testimonial and documentary evidence, are the same as those in the Mendoza and Rodrigo cases. Lastly, respondents point out that the findings of fact in the said two cases are also the same,i.e.: (i) Respondents did not breach any contract since the 349 crowns with security code L­2560­FQ are not winning crowns; and (ii) Respondents were not negligent in the conduct of their promotion and they exerted efforts to ensure the integrity and smooth conduct of the same. The instant petition must be denied. The principle of stare decisis et non quieta movere[22] is entrenched in Article 8 of the Civil Code, to wit: ART. 8. Judicial decisions applying or interpreting the laws or the Constitution shall form a part of the legal system of the Philippines.

It enjoins adherence to judicial precedents. It requires our courts to follow a rule already established in a final decision of the Supreme Court. That decision becomes a judicial precedent to be followed in subsequent cases by all courts in the land. The doctrine ofstare decisis is based on the principle that once a question of law has been examined and decided, it should be deemed settled and closed to further argument.[23]

In the instant case, the legal rights and relations of the parties, the facts, the applicable laws, the causes of action, the issues, and the evidence are exactly the same as those in the decided cases of Mendoza and Rodrigo, supra. Hence, nothing is left to be argued. The issue has been settled and this Courts final decision in the said cases must be respected. This Courts hands are now tied by the finality of the said judgments. We have no recourse but to deny the instant petition. WHEREFORE, the instant petition is hereby DENIED. The assailed Order of the Regional Trial Court of Makati City, Branch 142, in Civil Cases Nos. 94­2414 to 94­2421, is AFFIRMED. Costs against petitioners. SO ORDERED. Davide, Jr., C.J., (Chairman), Ynares­Santiago, Carpio, and Azcuna, JJ., concur.

EN BANC [G.R. No. 159357. April 28, 2004]

Brother MARIANO MIKE Z. VELARDE, petitioner, vs. SOCIAL JUSTICE SOCIETY, respondent. D E C I S I O N

PANGANIBAN, J.: A decision that does not conform to the form and substance required by the Constitution and the law is void and deemed legally inexistent. To be valid, decisions should comply with the form, the procedure and the substantive requirements laid out in the Constitution, the Rules of Court and relevant circulars/orders of the Supreme Court. For the guidance of the bench and the bar, the Court hereby discusses these forms, procedures and requirements.

The Case Before us is a Petition for Review[1] under Rule 45 of the Rules of Court, assailing the June 12, 2003 Decision[2] and July 29, 2003 Order[3] of the Regional Trial Court (RTC) of Manila (Branch 49).[4]

The challenged Decision was the offshoot of a Petition for Declaratory Relief[5] filed before the RTC­Manila by herein Respondent Social Justice Society (SJS) against herein Petitioner Mariano Mike Z. Velarde, together with His Eminence, Jaime Cardinal Sin, Executive Minister Erao Manalo, Brother Eddie Villanueva and Brother Eliseo F. Soriano as co­respondents. The Petition prayed for the resolution of the question whether or not the act of a religious leader like any of herein respondents, in endorsing the candidacy of a candidate for elective office or in urging or requiring the members of his flock to vote for a specified candidate, is violative of the letter or spirit of the constitutional provisions x x x.[6]

Alleging that the questioned Decision did not contain a statement of facts and a dispositive portion, herein petitioner filed a Clarificatory Motion and Motion for Reconsideration before the trial court. Soriano, his co­respondent, similarly filed a separate Motion for Reconsideration. In response, the trial court issued the assailed Order, which held as follows: x x x [T]his Court cannot reconsider, because what it was asked to do, was only to clarify a Constitutional provision and to declare whether acts are violative thereof. The Decision did not make a dispositive portion because a dispositive portion is required only in coercive reliefs, where a redress from wrong suffered and the benefit that the prevailing party wronged should get. The step that these movants have to take, is direct appeal under Rule 45 of the Rules of Court, for a conclusive interpretation of the Constitutional provision to the Supreme Court.[7]

The Antecedent Proceedings On January 28, 2003, SJS filed a Petition for Declaratory Relief (SJS Petition) before the RTC­Manila against Velarde and his aforesaid co­respondents. SJS, a registered political party, sought the interpretation of several constitutional provisions,[8] specifically on the separation of church and state; and a declaratory judgment on the constitutionality of the acts of religious leaders endorsing a candidate for an elective office, or urging or requiring the members of their flock to vote for a specified candidate. The subsequent proceedings were recounted in the challenged Decision in these words: x x x. Bro. Eddie Villanueva submitted, within the original period [to file an Answer], a Motion to Dismiss. Subsequently, Executive Minister Erao Manalo and Bro. Mike Velarde, filed their Motions to Dismiss. While His Eminence Jaime Cardinal L. Sin, filed a Comment and Bro. Eli Soriano, filed an Answer within the extended period and similarly prayed for the dismissal of the Petition. All sought the dismissal of the Petition on the common grounds that it does not state a cause of action and that there is no justiciable controversy. They were ordered to submit a pleading by way of advisement, which was closely followed by another Order denying all the Motions to Dismiss. Bro. Mike Velarde, Bro. Eddie Villanueva and Executive Minister Erao Manalo moved to reconsider the denial. His Eminence Jaime Cardinal L. Sin, asked for extension to file memorandum. Only Bro. Eli Soriano complied with the first Order by submitting his Memorandum. x x x.

x x x the Court denied the Motions to Dismiss, and the Motions for Reconsideration filed by Bro. Mike Velarde, Bro. Eddie Villanueva and Executive Minister Erao Manalo, which raised no new arguments other than those already considered in the motions to dismiss x x x.[9]

After narrating the above incidents, the trial court said that it had jurisdiction over the Petition, because in praying for a determination as to whether the actions imputed to the respondents are violative of Article II, Section 6 of the Fundamental Law, [the Petition] has raised only a question of law.[10] It then proceeded to a lengthy discussion of the issue raised in the Petition the separation of church and state even tracing, to some extent, the historical background of the principle. Through its discourse, the court a quoopined at some point that the [e]ndorsement of specific candidates in an election to any public office is a clear violation of the separation clause.[11]

After its essay on the legal issue, however, the trial court failed to include a dispositive portion in its assailed Decision. Thus, Velarde and Soriano filed separate Motions for Reconsideration which, as mentioned earlier, were denied by the lower court. Hence, this Petition for Review.[12]

This Court, in a Resolution[13] dated September 2, 2003, required SJS and the Office of the Solicitor General (OSG) to submit their respective comments. In the same Resolution, the Court gave the other parties ­­ impleaded as respondents in the original case below ­­the opportunity to comment, if they so desired. On April 13, 2004, the Court en banc conducted an Oral Argument.[14]

The Issues In his Petition, Brother Mike Velarde submits the following issues for this Courts resolution: 1. Whether or not the Decision dated 12 June 2003 rendered by the court a quo was proper and valid; 2. Whether or not there exists justiceable controversy in herein respondents Petition for declaratory relief; 3. Whether or not herein respondent has legal interest in filing the Petition for declaratory relief; 4. Whether or not the constitutional question sought to be resolved by herein respondent is ripe for judicial determination; 5. Whether or not there is adequate remedy other than the declaratory relief; and, 6. Whether or not the court a quo has jurisdiction over the Petition for declaratory relief of herein respondent.[15]

During the Oral Argument, the issues were narrowed down and classified as follows: A. Procedural Issues

Did the Petition for Declaratory Relief raise a justiciable controversy? Did it state a cause of action? Did respondent have any legal standing to file the Petition for Declaratory Relief? B. Substantive Issues 1. Did the RTC Decision conform to the form and substance required by the Constitution, the law and the Rules of Court? 2. May religious leaders like herein petitioner, Bro. Mike Velarde, be prohibited from endorsing candidates for public office? Corollarily, may they be banned from campaigning against said candidates?

The Courts Ruling The Petition of Brother Mike Velarde is meritorious.

Procedural Issues: Requisites of Petitions for Declaratory Relief

Section 1 of Rule 63 of the Rules of Court, which deals with petitions for declaratory relief, provides in part: Section 1. Who may file petition.­ Any person interested under a deed, will, contract or other written instrument, whose rights are affected by a statute, executive order or regulation, ordinance, or any other governmental regulation may, before breach or violation thereof, bring an action in the appropriate Regional Trial Court to determine any question of construction or validity arising, and for a declaration of his rights or duties thereunder. Based on the foregoing, an action for declaratory relief should be filed by a person interested under a deed, a will, a contract or other written instrument, and whose rights are affected by a statute, an executive order, a regulation or an ordinance. The purpose of the remedy is to interpret or to determine the validity of the written instrument and to seek a judicial declaration of the parties rights or duties thereunder.[16] The essential requisites of the action are as follows: (1) there is a justiciable controversy; (2) the controversy is between persons whose interests are adverse; (3) the party seeking the relief has a legal interest in the controversy; and (4) the issue is ripe for judicial determination.[17]

Justiciable Controversy Brother Mike Velarde contends that the SJS Petition failed to allege, much less establish before the trial court, that there existed a justiciable controversy or an adverse legal interest between them; and that SJS had a legal right that was being violated or threatened to be violated by petitioner. On the contrary, Velarde alleges that SJS premised its action on mere speculations, contingent events, and hypothetical issues that had not yet ripened into an actual controversy. Thus, its Petition for Declaratory Relief must fail.

A justiciable controversy refers to an existing case or controversy that is appropriate or ripe for judicial determination, not one that is conjectural or merely anticipatory.[18]The SJS Petition for Declaratory Relief fell short of this test. It miserably failed to allege an existing controversy or dispute between the petitioner and the named respondents therein. Further, the Petition did not sufficiently state what specific legal right of the petitioner was violated by the respondents therein; and what particular act or acts of the latter were in breach of its rights, the law or the Constitution. As pointed out by Brother Eliseo F. Soriano in his Comment,[19] what exactly has he done that merited the attention of SJS? He confesses that he does not know the answer, because the SJS Petition (as well as the assailed Decision of the RTC) yields nothing in this respect. His Eminence, Jaime Cardinal Sin, adds that, at the time SJS filed its Petition on January 28, 2003, the election season had not even started yet; and that, in any event, he has not been actively involved in partisan politics. An initiatory complaint or petition filed with the trial court should contain a plain, concise and direct statement of the ultimate facts on which the party pleading relies for his claim x x x.[20] Yet, the SJS Petition stated no ultimate facts. Indeed, SJS merely speculated or anticipated without factual moorings that, as religious leaders, the petitioner and his co­respondents below had endorsed or threatened to endorse a candidate or candidates for elective offices; and that such actual or threatened endorsement will enable [them] to elect men to public office who [would] in turn be forever beholden to their leaders, enabling them to control the government[;][21] and pos[ing] a clear and present danger of serious erosion of the peoples faith in the electoral process[;] and reinforc[ing] their belief that religious leaders determine the ultimate result of elections,[22] which would then be violative of the separation clause. Such premise is highly speculative and merely theoretical, to say the least. Clearly, it does not suffice to constitute a justiciable controversy. The Petition does not even allege any indication or manifest intent on the part of any of the respondents below to champion an electoral candidate, or to urge their so­called flock to vote for, or not to vote for, a particular candidate. It is a time­honored rule that sheer speculation does not give rise to an actionable right. Obviously, there is no factual allegation that SJS rights are being subjected to any threatened, imminent and inevitable violation that should be prevented by the declaratory relief sought. The judicial power and duty of the courts to settle actual controversies involving rights that are legally demandable and enforceable[23] cannot be exercised when there is no actual or threatened violation of a legal right. All that the 5­page SJS Petition prayed for was that the question raised in paragraph 9 hereof be resolved.[24] In other words, it merely sought an opinion of the trial court on whether the speculated acts of religious leaders endorsing elective candidates for political offices violated the constitutional principle on the separation of church and state. SJS did not ask for a declaration of its rights and duties; neither did it pray for the stoppage of any threatened violation of its declared rights. Courts, however, are proscribed from rendering an advisory opinion.[25]

Cause of Action Respondent SJS asserts that in order to maintain a petition for declaratory relief, a cause of action need not be alleged or proven. Supposedly, for such petition to prosper, there need not be any violation of a right, breach of duty or actual wrong committed by one party against the other. Petitioner, on the other hand, argues that the subject matter of an action for declaratory relief should be a deed, a will, a contract (or other written instrument), a statute, an executive order, a regulation or an ordinance. But the subject matter of the SJS Petition is the constitutionality of an act of a religious leader to endorse the candidacy of a candidate for elective office or to urge or require the members of the flock to vote for a specified candidate.[26] According to petitioner, this subject matter is beyond the realm of an action for declaratory relief.[27] Petitioner avers that in the absence of a valid subject matter, the Petition fails to state a cause of action and, hence, should have been dismissed outright by the courta quo. A cause of action is an act or an omission of one party in violation of the legal right or rights of another, causing injury to the latter.[28] Its essential elements are the following: (1) a right in favor of the plaintiff; (2) an obligation on the part of the named defendant to respect or not to violate such right; and (3) such defendants act or omission that is violative of the right of the plaintiff or constituting a breach of the obligation of the former to the latter.[29]

The failure of a complaint to state a cause of action is a ground for its outright dismissal.[30] However, in special civil actions for declaratory relief, the concept of a cause of action under ordinary civil actions does not strictly apply. The reason for this exception is that an action for declaratory relief presupposes that there has been no actual breach of the instruments involved or of rights arising thereunder.[31] Nevertheless, a breach or violation should be impending, imminent or at least threatened. A perusal of the Petition filed by SJS before the RTC discloses no explicit allegation that the former had any legal right in its favor that it sought to protect. We can only infer the interest, supposedly in its favor, from its bare allegation that it has thousands of members who are citizens­taxpayers­registered voters and who are keenly interested in a judicial clarification of the constitutionality of the partisan participation of religious leaders in Philippine politics and in the process to insure adherence to the Constitution by everyone x x x.[32]

Such general averment does not, however, suffice to constitute a legal right or interest. Not only is the presumed interest not personal in character; it is likewise too vague, highly speculative and uncertain.[33] The Rules require that the interest must be material to the issue and affected by the questioned act or instrument, as distinguished from simple curiosity or incidental interest in the question raised.[34]

To bolster its stance, SJS cites the Corpus Juris Secundum and submits that the [p]laintiff in a declaratory judgment action does not seek to enforce a claim against [the] defendant, but seeks a judicial declaration of [the] rights of the parties for the purpose of guiding [their] future conduct, and the essential distinction between a declaratory judgment action and the usual action is that no actual wrong need have been committed or loss have occurred in order to sustain the declaratory judgment action, although there must be no uncertainty that the loss will occur or that the asserted rights will be invaded.[35]

SJS has, however, ignored the crucial point of its own reference that there must be no uncertainty that the loss will occur or that the asserted rights will be invaded.Precisely, as discussed earlier, it merely conjectures that herein petitioner (and his co­respondents below)might actively participate in partisan politics, use the awesome voting strength of its faithful flock [to] enable it to elect men to public office x x x, enabling [it] to control the government.[36]

During the Oral Argument, though, Petitioner Velarde and his co­respondents below all strongly asserted that they had not in any way engaged or intended to participate in partisan politics. They all firmly assured this Court that they had not done anything to trigger the issue raised and to entitle SJS to the relief sought. Indeed, the Court finds in the Petition for Declaratory Relief no single allegation of fact upon which SJS could base a right of relief from the named respondents. In any event, even granting that it sufficiently asserted a legal right it sought to protect, there was neverthelessno certainty that such right would be invaded by the said respondents.Not even the alleged proximity of the elections to the time the Petition was filed below (January 28, 2003) would have provided the certainty that it had a legal right that would be jeopardized or violated by any of those respondents. Legal Standing Legal standing or locus standi has been defined as a personal and substantial interest in the case, such that the party has sustained or will sustain direct injury as a result of the challenged act.[37] Interest means a material interest in issue that is affected by the questioned act or instrument, as distinguished from a mere incidental interest in the question involved.[38]

Petitioner alleges that [i]n seeking declaratory relief as to the constitutionality of an act of a religious leader to endorse, or require the members of the religious flock to vote for a specific candidate, herein Respondent SJS has no legal interest in the controversy;[39] it has failed to establish how the resolution of the proffered question would benefit or injure it. Parties bringing suits challenging the constitutionality of a law, an act or a statute must show not only that the law [or act] is invalid, but also that [they have] sustained or [are] in immediate or imminent danger of sustaining some direct injury as a result of its enforcement, and not merely that [they] suffer thereby in some indefinite way.[40] They must demonstrate that they have been, or are about to be, denied some right or privilege to which they are lawfully entitled, or that they are about to be subjected to some burdens or penalties by reason of the statute or act complained of.[41]

First, parties suing as taxpayers must specifically prove that they have sufficient interest in preventing the illegal expenditure of money raised by taxation.[42] A taxpayers action may be properly brought only when there is an exercise by Congress of its taxing or spending power.[43] In the present case, there is no allegation, whether express or implied, that taxpayers money is being illegally disbursed. Second, there was no showing in the Petition for Declaratory Relief that SJS as a political party or its members as registered voters would be adversely affected by the alleged acts of the respondents below, if the question at issue was not resolved. There was no allegation that SJS had suffered or would be deprived of votes due to the acts imputed to the said respondents. Neither did it allege that any of its members would be denied the right of suffrage or the privilege to be voted for a public office they are seeking. Finally, the allegedly keen interest of its thousands of members who are citizens­taxpayers­registered voters is too general[44] and beyond the contemplation of the standards set by our jurisprudence. Not only is the presumed interest impersonal in character; it is likewise too vague, highly speculative and uncertain to satisfy the requirement of standing.[45]

Transcendental Importance In any event, SJS urges the Court to take cognizance of the Petition, even sans legal standing, considering that the issues raised are of paramount public interest. In not a few cases, the Court has liberalized the locus standi requirement when a petition raises an issue of transcendental significance or paramount importance to the people.[46] Recently, after holding that the IBP had no locus standi to bring the suit, the Court inIBP v. Zamora[47] nevertheless entertained the Petition therein. It noted that the IBP has advanced constitutional issues which deserve the attention of this Court in view of their seriousness, novelty and weight as precedents.[48]

Similarly in the instant case, the Court deemed the constitutional issue raised in the SJS Petition to be of paramount interest to the Filipino people. The issue did not simply concern a delineation of the separation between church and state, but ran smack into the governance of our country. The issue was both transcendental in importance and novel in nature, since it had never been decided before. The Court, thus, called for Oral Argument to determine with certainty whether it could resolve the constitutional issue despite the barren allegations in the SJS Petition as well as the abbreviated proceedings in the court below. Much to its chagrin, however, counsels for the parties ­­ particularly for Respondent SJS ­­ made no satisfactory allegations or clarifications that would supply the deficiencies hereinabove discussed. Hence, even if the Court would exempt this case from the stringent locus standirequirement, such heroic effort would be futile because the transcendental issue cannot be resolved anyway. Proper Proceedings Before the Trial Court To prevent a repetition of this waste of precious judicial time and effort, and for the guidance of the bench and the bar, the Court reiterates the elementary procedure[49] that must be followed by trial courts in the conduct of civil cases.[50]

Prefatorily, the trial court may ­­ motu proprio or upon motion of the defendant ­­ dismiss a complaint[51] (or petition, in a special civil action) that does not allege the plaintiffs (or petitioners) cause or causes of action.[52] A complaint or petition should contain a plain, concise and direct statement of the ultimate facts on which the party pleading relies for his claim or defense.[53] It should likewise clearly specify the relief sought.[54]

Upon the filing of the complaint/petition and the payment of the requisite legal fees, the clerk of court shall forthwith issue the corresponding summons to the defendants or the respondents, with a directive that the defendant answer[55] within 15 days, unless a different period is fixed by the court.[56] The summons shall also contain a notice that if such answer is not filed, the plaintiffs/petitioners shall take a judgment by default and may be granted the relief applied for.[57] The court, however, may ­­ upon such terms as may be just ­­ allow an answer to be filed after the time fixed by the Rules.[58]

If the answer sets forth a counterclaim or cross­claim, it must be answered within ten (10) days from service.[59] A reply may be filed within ten (10) days from service of the pleading responded to.[60]

When an answer fails to tender an issue or admits the material allegations of the adverse partys pleading, the court may, on motion of that party, direct judgment on such pleading (except in actions for declaration of nullity or annulment of marriage or for legal separation).[61] Meanwhile, a party seeking to recover upon a claim, a counterclaim or crossclaim ­­ or to obtain a declaratory relief ­­ may, at any time after the answer thereto has been served, move for a summary judgment in its favor.[62] Similarly, a party against whom a claim, a counterclaim or crossclaim is asserted ­­ or a declaratory relief sought ­­ may, at any time, move for a summary judgment in its favor.[63] After the motion is heard, the judgment sought shall be rendered forthwith if there is a showing that, except as to the amount of damages, there is no genuine issue as to any material fact; and that the moving party is entitled to a judgment as a matter of law.[64]

Within the time for ­­ but before ­­ filing the answer to the complaint or petition, the defendant may file a motion to dismiss based on any of the grounds stated in Section 1 of Rule 16 of the Rules of Court. During the hearing of the motion, the parties shall submit their arguments on the questions of law, and their evidence on the questions of fact.[65]After the hearing, the court may dismiss the action or claim, deny the motion, or order the amendment of the pleadings. It shall not defer the resolution of the motion for the reason that the ground relied upon is not indubitable. In every case, the resolution shall state clearly and distinctly the reasons therefor.[66]

If the motion is denied, the movant may file an answer within the balance of the period originally prescribed to file an answer, but not less than five (5) days in any event, computed from the receipt of the notice of the denial. If the pleading is ordered to be amended, the defendant shall file an answer within fifteen (15) days, counted from the service of the amended pleading, unless the court provides a longer period.[67]

After the last pleading has been served and filed, the case shall be set for pretrial,[68] which is a mandatory proceeding.[69] A plaintiffs/ petitioners (or its duly authorized representatives) non­appearance at the pretrial, if without valid cause, shall result in the dismissal of the action with prejudice, unless the court orders otherwise. A similar failure on the part of the defendant shall be a cause for allowing the plaintiff/petitioner to present evidence ex parte, and the court to render judgment on the basis thereof.[70]

The parties are required to file their pretrial briefs; failure to do so shall have the same effect as failure to appear at the pretrial.[71] Upon the termination thereof, the court shall issue an order reciting in detail the matters taken up at the conference; the action taken on them, the amendments allowed to the pleadings; and the agreements or admissions, if any, made by the parties regarding any of the matters considered.[72] The parties may further avail themselves of any of the modes of discovery,[73] if they so wish. Thereafter, the case shall be set for trial,[74] in which the parties shall adduce their respective evidence in support of their claims and/or defenses. By their written consent or upon the application of either party, or on its own motion, the court may also order any or all of the issues to be referred to a commissioner, who is to be appointed by it or to be agreed upon by the parties.[75] The trial or hearing before the commissioner shall proceed in all respects as it would if held before the court.[76]

Upon the completion of such proceedings, the commissioner shall file with the court a written report on the matters referred by the parties.[77] The report shall be set for hearing, after which the court shall issue an order adopting, modifying or rejecting it in whole or in part; or recommitting it with instructions; or requiring the parties to present further evidence before the commissioner or the court.[78]

Finally, a judgment or final order determining the merits of the case shall be rendered. The decision shall be in writing, personally and directly prepared by the judge, stating clearly and distinctly the facts and the law on which it is based, signed by the issuing magistrate, and filed with the clerk of court.[79]

Based on these elementary guidelines, let us examine the proceedings before the trial court in the instant case. First, with respect to the initiatory pleading of the SJS. Even a cursory perusal of the Petition immediately reveals its gross inadequacy. It contained no statement of ultimate facts upon which the petitioner relied for its claim. Furthermore, it did not specify the relief it sought from the court, but merely asked it to answer a hypothetical question. Relief, as contemplated in a legal action, refers to a specific coercive measure prayed for as a result of a violation of the rights of a plaintiff or a petitioner.[80] As already discussed earlier, the Petition before the trial court had no allegations of fact[81] or of any specific violation of the petitioners rights, which the respondents had a duty to respect.Such deficiency amounted to a failure to state a cause of action; hence, no coercive relief could be sought and adjudicated. The Petition evidently lacked substantive requirements and, we repeat, should have been dismissed at the outset. Second, with respect to the trial court proceedings. Within the period set to file their respective answers to the SJS Petition, Velarde, Villanueva and Manalo filed Motions to Dismiss; Cardinal Sin, a Comment; and Soriano, within a priorly granted extended period, an Answer in which he likewise prayed for the dismissal of the Petition.[82] SJS filed a Rejoinder to the Motion of Velarde, who subsequently filed a Sur­Rejoinder. Supposedly, there were several scheduled settings, in which the [c]ourt was apprised of the respective positions of the parties.[83] The nature of such settings ­­ whether pretrial or trial hearings ­­ was not disclosed in the records. Before ruling on the Motions to Dismiss, the trial court issued an Order[84] dated May 8, 2003, directing the parties to submit their memoranda. Issued shortly thereafter was another Order[85] dated May 14, 2003, denying all the Motions to Dismiss. In the latter Order, the trial court perfunctorily ruled: The Court now resolves to deny the Motions to Dismiss, and after all the memoranda are submitted, then, the case shall be deemed as submitted for resolution.[86]

Apparently, contrary to the requirement of Section 2 of Rule 16 of the Rules of Court, the Motions were not heard. Worse, the Order purportedly resolving the Motions to Dismiss did not state any reason at all for their denial, in contravention of Section 3 of the said Rule 16. There was not even any statement of the grounds relied upon by the Motions; much less, of the legal findings and conclusions of the trial court. Thus, Velarde, Villanueva and Manalo moved for reconsideration. Pending the resolution of these Motions for Reconsideration, Villanueva filed a Motion to suspend the filing of the parties memoranda. But instead of separately resolving the pending Motions fairly and squarely, the trial court again transgressed the Rules of Court when it immediately proceeded to issue its Decision, even before tackling the issues raised in those Motions. Furthermore, the RTC issued its Decision without allowing the parties to file their answers. For this reason, there was no joinder of the issues. If only it had allowed the filing of those answers, the trial court would have known, as the Oral Argument revealed, that the petitioner and his co­respondents below had not committed or threatened to commit the act attributed to them (endorsing candidates) ­­ the act that was supposedly the factual basis of the suit. Parenthetically, the court a quo further failed to give a notice of the Petition to the OSG, which was entitled to be heard upon questions involving the constitutionality or validity of statutes and other measures.[87]

Moreover, as will be discussed in more detail, the questioned Decision of the trial court was utterly wanting in the requirements prescribed by the Constitution and the Rules of Court. All in all, during the loosely abbreviated proceedings of the case, the trial court indeed acted with inexplicable haste, with total ignorance of the law ­­ or, worse, in cavalier disregard of the rules of procedure ­­ and with grave abuse of discretion. Contrary to the contentions of the trial judge and of SJS, proceedings for declaratory relief must still follow the process described above ­­ the petition must state a cause of action; the proceedings must undergo the procedure outlined in the Rules of Court; and the decision must adhere to constitutional and legal requirements.

First Substantive Issue: Fundamental Requirements

of a Decision

The Constitution commands that [n]o decision shall be rendered by any court without expressing therein clearly and distinctly the facts and the law on which it is based. No petition for review or motion for reconsideration of a decision of the court shall be refused due course or denied without stating the basis therefor.[88]

Consistent with this constitutional mandate, Section 1 of Rule 36 of the Rules on Civil Procedure similarly provides: Sec. 1. Rendition of judgments and final orders. A judgment or final order determining the merits of the case shall be in writing personally and directly prepared by the judge, stating clearly and distinctly the facts and the law on which it is based, signed by him and filed with the clerk of court. In the same vein, Section 2 of Rule 120 of the Rules of Court on Criminal Procedure reads as follows: Sec. 2. Form and contents of judgments. ­­ The judgment must be written in the official language, personally and directly prepared by the judge and signed by him and shall contain clearly and distinctly a statement of the facts proved or admitted by the accused and the law upon which the judgment is based.

x x x x x x x x x. Pursuant to the Constitution, this Court also issued on January 28, 1988, Administrative Circular No. 1, prompting all judges to make complete findings of facts in their decisions, and scrutinize closely the legal aspects of the case in the light of the evidence presented. They should avoid the tendency to generalize and form conclusions without detailing the facts from which such conclusions are deduced. In many cases,[89] this Court has time and time again reminded magistrates to heed the demand of Section 14, Article VIII of the Constitution. The Court, through Chief Justice Hilario G. Davide Jr. in Yao v. Court of Appeals,[90] discussed at length the implications of this provision and strongly exhorted thus: Faithful adherence to the requirements of Section 14, Article VIII of the Constitution is indisputably a paramount component of due process and fair play. It is likewise demanded by the due process clause of the Constitution. The parties to a litigation should be informed of how it was decided, with an explanation of the factual and legal reasons that led to the conclusions of the court. The court cannot simply say that judgment is rendered in favor of X and against Y and just leave it at that without any justification whatsoever for its action. The losing party is entitled to know why he lost, so he may appeal to the higher court, if permitted, should he believe that the decision should be reversed. A decision that does not clearly and distinctly state the facts and the law on which it is based leaves the parties in the dark as to how it was reached and is precisely prejudicial to the losing party, who is unable to pinpoint the possible errors of the court for review by a higher tribunal. More than that, the requirement is an assurance to the parties that, in reaching judgment, the judge did so through the processes of legal reasoning. It is, thus, a safeguard against the impetuosity of the judge, preventing him from deciding ipse dixit. Vouchsafed neither the sword nor the purse by the Constitution but nonetheless vested with the sovereign prerogative of passing judgment on the life, liberty or property of his fellowmen, the judge must ultimately depend on the power of reason for sustained public confidence in the justness of his decision. In People v. Bugarin,[91] the Court also explained: The requirement that the decisions of courts must be in writing and that they must set forth clearly and distinctly the facts and the law on which they are based serves many functions. It is intended, among other things, to inform the parties of the reason or reasons for the decision so that if any of them appeals, he can point out to the appellate court the finding of facts or the rulings on points of law with which he disagrees. More than that, the requirement is an assurance to the parties that, in reaching judgment, the judge did so through the processes of legal reasoning. x x x. Indeed, elementary due process demands that the parties to a litigation be given information on how the case was decided, as well as an explanation of the factual and legal reasons that led to the conclusions of the court.[92]

In Madrid v. Court of Appeals,[93] this Court had instructed magistrates to exert effort to ensure that their decisions would present a comprehensive analysis or account of the factual and legal findings that would substantially address the issues raised by the parties. In the present case, it is starkly obvious that the assailed Decision contains no statement of facts ­­ much less an assessment or analysis thereof ­­ or of the courts findings as to the probable facts. The assailed Decision begins with a statement of the nature of the action and the question or issue presented. Then follows a brief explanation of the constitutional provisions involved, and what the Petition sought to achieve. Thereafter, the ensuing procedural incidents before the trial court are tracked. The Decision proceeds to a full­length opinion on the nature and the extent of the separation of church and state. Without expressly stating the final conclusion she has reached or specifying the relief granted or denied, the trial judge ends her Decision with the clause SO ORDERED. What were the antecedents that necessitated the filing of the Petition? What exactly were the distinct facts that gave rise to the question sought to be resolved by SJS?More important, what were the factual findings and analysis on which the trial court based its legal findings and conclusions? None were stated or implied. Indeed, the RTCs Decision cannot be upheld for its failure to express clearly and distinctly the facts on which it was based. Thus, the trial court clearly transgressed the constitutional directive.

The significance of factual findings lies in the value of the decision as a precedent. How can it be so if one cannot apply the ruling to similar circumstances, simply because such circumstances are unknown? Otherwise stated, how will the ruling be applied in the future, if there is no point of factual comparison? Moreover, the court a quo did not include a resolutory or dispositive portion in its so­called Decision. The importance of such portion was explained in the early caseManalang v. Tuason de Rickards,[94] from which we quote: The resolution of the Court on a given issue as embodied in the dispositive part of the decision or order is the investitive or controlling factor that determines and settles the rights of the parties and the questions presented therein, notwithstanding the existence of statements or declaration in the body of said order that may be confusing. The assailed Decision in the present case leaves us in the dark as to its final resolution of the Petition. To recall, the original Petition was for declaratory relief. So, what relief did the trial court grant or deny? What rights of the parties did it conclusively declare? Its final statement says, SO ORDERED. But what exactly did the court order? It had the temerity to label its issuance a Decision, when nothing was in fact decided. Respondent SJS insists that the dispositive portion can be found in the body of the assailed Decision. It claims that the issue is disposed of and the Petition finally resolved by the statement of the trial court found on page 10 of its 14­page Decision, which reads: Endorsement of specific candidates in an election to any public office is a clear violation of the separation clause.[95]

We cannot agree. In Magdalena Estate, Inc. v. Caluag,[96] the obligation of the party imposed by the Court was allegedly contained in the text of the original Decision. The Court, however, held: x x x The quoted finding of the lower court cannot supply deficiencies in the dispositive portion. It is a mere opinion of the court and the rule is settled that where there is a conflict between thedispositive part and the opinion, the former must prevail over the latter on the theory that the dispositive portion is the final order while the opinion is merely a statement ordering nothing. (Italics in the original) Thus, the dispositive portion cannot be deemed to be the statement quoted by SJS and embedded in the last paragraph of page 10 of the assailed 14­page Decision. If at all, that statement is merely an answer to a hypothetical legal question and just a part of the opinion of the trial court. It does not conclusively declare the rights (or obligations) of the parties to the Petition. Neither does it grant any ­­ much less, the proper ­­ relief under the circumstances, as required of a dispositive portion. Failure to comply with the constitutional injunction is a grave abuse of discretion amounting to lack or excess of jurisdiction. Decisions or orders issued in careless disregard of the constitutional mandate are a patent nullity and must be struck down as void.[97]

Parts of a Decision In general, the essential parts of a good decision consist of the following: (1) statement of the case; (2) statement of facts; (3) issues or assignment of errors; (4) court ruling, in which each issue is, as a rule, separately considered and resolved; and, finally, (5) dispositive portion. The ponente may also opt to include an introduction or a prologue as well as an epilogue, especially in cases in which controversial or novel issues are involved.[98]

An introduction may consist of a concise but comprehensive statement of the principal factual or legal issue/s of the case. In some cases ­­ particularly those concerning public interest; or involving complicated commercial, scientific, technical or otherwise rare subject matters ­­ a longer introduction or prologue may serve to acquaint readers with the specific nature of the controversy and the issues involved. An epilogue may be a summation of the important principles applied to the resolution of the issues of paramount public interest or significance. It may also lay down an enduring philosophy of law or guiding principle. Let us now, again for the guidance of the bench and the bar, discuss the essential parts of a good decision. 1. Statement of the Case The Statement of the Case consists of a legal definition of the nature of the action. At the first instance, this part states whether the action is a civil case for collection, ejectment, quieting of title, foreclosure of mortgage, and so on; or, if it is a criminal case, this part describes the specific charge ­­ quoted usually from the accusatory portion of the information ­­ and the plea of the accused. Also mentioned here are whether the case is being decided on appeal or on a petition for certiorari, the court of origin, the case number in the trial court, and the dispositive portion of the assailed decision. In a criminal case, the verbatim reproduction of the criminal information serves as a guide in determining the nature and the gravity of the offense for which the accused may be found culpable. As a rule, the accused cannot be convicted of a crime different from or graver than that charged. Also, quoting verbatim the text of the information is especially important when there is a question on the sufficiency of the charge, or on whether qualifying and modifying circumstances have been adequately alleged therein. To ensure that due process is accorded, it is important to give a short description of the proceedings regarding the plea of the accused. Absence of an arraignment, or a serious irregularity therein, may render the judgment void, and further consideration by the appellate court would be

futile. In some instances, especially in appealed cases, it would also be useful to mention the fact of the appellants detention, in order to dispose of the preliminary query ­­ whether or not they have abandoned their appeal by absconding or jumping bail. Mentioning the court of origin and the case number originally assigned helps in facilitating the consolidation of the records of the case in both the trial and the appellate courts, after entry of final judgment. Finally, the reproduction of the decretal portion of the assailed decision informs the reader of how the appealed case was decided by the courta quo. 2. Statement of Facts There are different ways of relating the facts of the case. First, under the objective or reportorial method, the judge summarizes ­­ without comment ­­ the testimony of each witness and the contents of each exhibit. Second, under the synthesis method, the factual theory of the plaintiff or prosecution and then that of the defendant or defense is summarized according to the judges best light. Third, in the subjective method, the version of the facts accepted by the judge is simply narrated without explaining what the parties versions are. Finally, through a combination of objective and subjective means, the testimony of each witness is reported and the judge then formulates his or her own version of the facts. In criminal cases, it is better to present both the version of the prosecution and that of the defense, in the interest of fairness and due process. A detailed evaluation of the contentions of the parties must follow. The resolution of most criminal cases, unlike civil and other cases, depends to a large extent on the factual issues and the appreciation of the evidence. The plausibility or the implausibility of each version can sometimes be initially drawn from a reading of the facts. Thereafter, the bases of the court in arriving at its findings and conclusions should be explained. On appeal, the fact that the assailed decision of the lower court fully, intelligently and correctly resolved all factual and legal issues involved may partly explain why the reviewing court finds no reason to reverse the findings and conclusions of the former. Conversely, the lower courts patent misappreciation of the facts or misapplication of the law would aid in a better understanding of why its ruling is reversed or modified. In appealed civil cases, the opposing sets of facts no longer need to be presented. Issues for resolution usually involve questions of law, grave abuse of discretion, or want of jurisdiction; hence, the facts of the case are often undisputed by the parties. With few exceptions, factual issues are not entertained in non­criminal cases. Consequently, the narration of facts by the lower court, if exhaustive and clear, may be reproduced; otherwise, the material factual antecedents should be restated in the words of the reviewing magistrate. In addition, the reasoning of the lower court or body whose decision is under review should be laid out, in order that the parties may clearly understand why the lower court ruled in a certain way, and why the reviewing court either finds no reason to reverse it or concludes otherwise. 3. Issues or Assignment of Errors Both factual and legal issues should be stated. On appeal, the assignment of errors, as mentioned in the appellants brief, may be reproduced in toto and tackled seriatim,so as to avoid motions for reconsideration of the final decision on the ground that the court failed to consider all assigned errors that could affect the outcome of the case. But when the appellant presents repetitive issues or when the assigned errors do not strike at the main issue, these may be restated in clearer and more coherent terms. Though not specifically questioned by the parties, additional issues may also be included, if deemed important for substantial justice to be rendered. Note that appealed criminal cases are givende novo review, in contrast to noncriminal cases in which the reviewing court is generally limited to issues specifically raised in the appeal. The few exceptions are errors of jurisdiction; questions not raised but necessary in arriving at a just decision on the case; or unassigned errors that are closely related to those properly assigned, or upon which depends the determination of the question properly raised. 4. The Courts Ruling This part contains a full discussion of the specific errors or issues raised in the complaint, petition or appeal, as the case may be; as well as of other issues the court deems essential to a just disposition of the case. Where there are several issues, each one of them should be separately addressed, as much as practicable. The respective contentions of the parties should also be mentioned here. When procedural questions are raised in addition to substantive ones, it is better to resolve the former preliminarily. 5. The Disposition or Dispositive Portion In a criminal case, the disposition should include a finding of innocence or guilt, the specific crime committed, the penalty imposed, the participation of the accused, the modifying circumstances if any, and the civil liability and costs. In case an acquittal is decreed, the court must order the immediate release of the accused, if detained, (unless they are being held for another cause) and order the director of the Bureau of Corrections (or wherever the accused is detained) to report, within a maximum of ten (10) days from notice, the exact date when the accused were set free. In a civil case as well as in a special civil action, the disposition should state whether the complaint or petition is granted or denied, the specific relief granted, and the costs.The following test of completeness may be applied. First, the parties should know their rights and obligations. Second, they should know how to execute the decision under alternative contingencies. Third, there should be no need for further proceedings

to dispose of the issues. Fourth, the case should be terminated by according the proper relief.The proper relief usually depends upon what the parties seek in their pleadings. It may declare their rights and duties, command the performance of positive prestations, or order them to abstain from specific acts. The disposition must also adjudicate costs. The foregoing parts need not always be discussed in sequence. But they should all be present and plainly identifiable in the decision. Depending on the writers character, genre and style, the language should be fresh and free­flowing, not necessarily stereotyped or in a fixed form; much less highfalutin, hackneyed and pretentious. At all times, however, the decision must be clear, concise, complete and correct.

Second Substantive Issue: Religious Leaders Endorsement of Candidates for Public Office

The basic question posed in the SJS Petition ­­ WHETHER ENDORSEMENTS OF CANDIDACIES BY RELIGIOUS LEADERS IS UNCONSTITUTIONAL ­­ undoubtedly deserves serious consideration. As stated earlier, the Court deems this constitutional issue to be of paramount interest to the Filipino citizenry, for it concerns the governance of our country and its people. Thus, despite the obvious procedural transgressions by both SJS and the trial court, this Court still called for Oral Argument, so as not to leave any doubt that there might be room to entertain and dispose of the SJS Petition on the merits. Counsel for SJS has utterly failed, however, to convince the Court that there are enough factual and legal bases to resolve the paramount issue. On the other hand, the Office of the Solicitor General has sided with petitioner insofar as there are no facts supporting the SJS Petition and the assailed Decision. We reiterate that the said Petition failed to state directly the ultimate facts that it relied upon for its claim. During the Oral Argument, counsel for SJS candidly admitted that there were no factual allegations in its Petition for Declaratory Relief. Neither were there factual findings in the assailed Decision. At best, SJS merely asked the trial court to answer a hypothetical question. In effect, it merely sought an advisory opinion, the rendition of which was beyond the courts constitutional mandate and jurisdiction.[99]

Indeed, the assailed Decision was rendered in clear violation of the Constitution, because it made no findings of facts and final disposition. Hence, it is void and deemed legally inexistent. Consequently, there is nothing for this Court to review, affirm, reverse or even just modify. Regrettably, it is not legally possible for the Court to take up, on the merits, the paramount question involving a constitutional principle. It is a time­honored rule that the constitutionality of a statute [or act] will be passed upon only if, and to the extent that, it is directly and necessarily involved in a justiciable controversy and is essential to the protection of the rights of the parties concerned.[100]

WHEREFORE, the Petition for Review of Brother Mike Velarde is GRANTED.Theassailed June 12, 2003 Decision and July 29, 2003 Order of the Regional Trial Court of Manila (Branch 49) are herebyDECLARED NULL AND VOIDand thusSET ASIDE. The SJS Petition for Declaratory Relief is DISMISSED for failure to state a cause of action. Let a copy of this Decision be furnished the Office of the Court Administrator to evaluate and recommend whether the trial judge may, after observing due process, be held administratively liable for rendering a decision violative of the Constitution, the Rules of Court and relevant circulars of this Court. No costs. SO ORDERED. Davide, Jr., C.J., Puno, Quisumbing, Sandoval­Gutierrez, Carpio, Austria­Martinez, Carpio­Morales, Callejo, Sr., Azcuna, and Tinga, JJ., concur. Vitug, J., in the result. Ynares­Santiago, J., no part. Corona, J., on leave.

FIRST DIVISION [G.R. No. 144412. November 18, 2003]

ALLIED BANKING CORPORATION, petitioner, vs. COURT OF APPEALS and POTENCIANO L. GALANIDA, respondents. D E C I S I O N

CARPIO, J.: The Case

Before the Court is a petition for review[1] assailing the Decision[2] of 27 April 2000 and the Resolution of 8 August 2000 of the Court of Appeals in CA­G.R. SP No. 51451.The Court of Appeals upheld the Decision[3] of 18 September 1998 and the Resolution of 24 December 1998 of the National Labor Relations Commission (NLRC) in NLRC Case No. V­000180­98. The NLRC modified the Decision dated 23 December 1997 of Labor Arbiter Dominador A. Almirante (Labor Arbiter) in NLRC Case No. RAB VII­05­0545­94 holding that Allied Banking Corporation (Allied Bank) illegally dismissed Potenciano L. Galanida (Galanida). The NLRC awarded Galanida separation pay, backwages, moral and exemplary damages, and other amounts totaling P1,264,933.33.

Antecedent Facts

For a background of this case, we quote in part from the Decision of the Court of Appeals: Private respondent Potenciano Galanida was hired by petitioner Allied Banking Corporation on 11 January 1978 and rose from accountant­book(k)eeper to assistant manager in 1991. His appointment was covered by a Notice of Personnel Action which provides as one of the conditions of employment the provision on petitioners right to transfer employees: REGULAR APPOINTMENT: xxx It is understood that the bank reserves the right to transfer or assign you to other departments or branches of the bank as the need arises and in the interest of maintaining smooth and uninterrupted service to the public. Private respondent was promoted several times and was transferred to several branches as follows: a) January, 1978 to March, 1982 Tagbilaran City Branch b) April, 1982 to May, 1984 Lapulapu City Branch c) June, 1984 Mandaue City Branch d) July, 1984 to April, 1986 Tagbilaran City Branch e) May, 1986 to May, 1987 Dumaguete City Branch f) June, 1987 to August, 1987 Carbon Branch, Cebu City g) September, 1987 to Sept. 1989 Lapulapu City Branch, Cebu h) October, 1989 to Sept. 1992 Carbon Branch, Cebu City i) October 1992 to Sept. 1994 Jakosalem Regional Branch, Cebu City (Rollo, p. 47) Effecting a rotation/movement of officers assigned in the Cebu homebase, petitioner listed respondent as second in the order of priority of assistant managers to be assigned outside of Cebu Cityhaving been stationed in Cebu for seven years already. Private respondent manifested his refusal to be transferred to Bacolod City in a letter dated 19 April 1994 citing as reason parental obligations, expenses, and the anguish that would result if he is away from his family. He then filed a complaint before the Labor Arbiter for constructive dismissal. Subsequently, petitioner bank informed private respondent (Rollo, p. 86) that he was to report to the Tagbilaran City Branch effective 23 May 1994. Private respondent refused. In a letter dated13 June 1994, petitioner warned and required of private respondent as follows: There is no discrimination in your transfer. In fact, among the officers mentioned, only you have refused the new assignment citing difficulty of working away from your family as if the other officers concerned do not suffer the same predicament. To exempt you from the officer transfer would result in favoritism in your favor and discrimination as against the other officers concerned. In furtherance of maintaining a smooth and uninterrupted service to the public, and in accordance with the Banks order of priority of rotating its accountants places of assignments, you are well aware that Roberto Isla, AM/Accountant, assigned in Cebu for more than ten (10) years, was, on February 14, 1994, reassigned to Iligan City Branch and then to Cagayan de Oro City Branch on June 8, 1994. Hence, your objection on the ground of your length of service is without merit. xxx As discussed, your refusal to follow instruction concerning your transfer and reassignment to Bacolod City and to Tagbilaran City is penalized under Article XII of the Banks Employee Discipline Policy and Procedure [which] provides: XII Transfer and Reassignment Refusal to follow instruction concerning transfers and reassignments. First and subsequent offenses The penalty may range from suspension to dismissal as determined by management. The employee shall be required to comply with the order of transfer and reassignment, if the penalty is not termination of employment. In view of the foregoing, please explain in writing within three (3) days from receipt hereof why no disciplinary action should be meted against you for your having refused to follow instructions concerning the foregoing transfer and reassignment. xxx[4]

On 16 June 1994, Galanida replied that (w)hether the banks penalty for my refusal be Suspension or Dismissal xxx it will all the more establish and fortify my complaint now pending at NLRC, RAB 7.[5] In the same letter, he charged Allied Bank with discrimination and favoritism in ordering his transfer, thus: xxx What I cannot decipher now under the headship of Mr. Olveda is managements discriminatory act of transferring only the long staying accountants of Cebu in the guise of its exercise of management prerogative when in truth and in fact, the ulterior motive is to accommodate some new officers who happen to enjoy favorable connection with management. How can the bank ever justify the transfer of Melinda T. Co, a new officer who had experienced being assigned outside of Cebu for more than a year only to Tabunok Branch? If the purpose is for check and balance, is management implying that Melinda Co can better carry out such function over Mr. Larry Sabelino, who is a seasoned and experienced accountant or any of the Metro Cebu accountants for that matter? Isnt this act of management an obvious display of favoritism? xxx[6]

On 5 October 1994, Galanida received an inter­office communication[7] (Memo) dated 8 September 1994 from Allied Banks Vice­President for Personnel, Mr. Leonso C. Pe.The Memo informed Galanida that Allied Bank had terminated his services effective 1 September 1994. The reasons given for the dismissal were: (1) Galanidas continued refusal to be transferred from the Jakosalem, Cebu City branch; and (2) his refusal to report for work despite the denial of his application for additional vacation leave. The salient portion of the Memo reads: Therefore, your refusal to follow instruction concerning your transfer and reassignment to Bacolod City and to Tagbilaran City is without any justifiable reason and constituted violations of Article XII of the Banks EDPP xxx In view of the foregoing, please be informed that the Bank has terminated your services effective September 1, 1994 and considered whatever benefit, if any, that you are entitled as forfeited in accordance with 04, V Administrative Penalties, page 6 of the Banks EDPP which provides as follows: 04. Dismissal. Dismissal is a permanent separation for cause xxx Notice of termination shall be issued by the Investigation Committee subject to the confirmation of the President or his authorized representative as officer/employee who is terminated for cause shall not be eligible to receive any benefit arising from her/his employment with the Bank or to termination pay. It is understood that the termination of your service shall be without prejudice to whatever legal remedies which the Bank may have already undertaken and/or will undertake against you. Please be guided accordingly. (Emphasis supplied)[8]

The Ruling of the Labor Arbiter After several hearings, the Labor Arbiter held that Allied Bank had abused its management prerogative in ordering the transfer of Galanida to its Bacolod and Tagbilaran branches. In ruling that Galanidas refusal to transfer did not amount to insubordination, the Labor Arbiter misquoted this Courts decision in Dosch v. NLRC,[9] thus: As a general rule, the right to transfer or reassign an employee is recognized as an employers exclusive right and the prerogative of management (Abbott Laboratories vs. NLRC, 154 SCRA 713 [1987]). The exercise of this right, is not however, absolute. It has certain limitations. Thus, in Helmut Dosch vs. NLRC, et al. 123 SCRA 296 (1983), the Supreme Court, ruled: While it may be true that the right to transfer or reassign an employee is an employers exclusive right and the prerogative of management, such right is not absolute. The right of an employer to freely select or discharge his employee is limited by the paramount police power xxx for the relations between capital and labor are not merely contractual but impressed with public interest. xxx And neither capital nor labor shall act oppressively against each other. Refusal to obey a transfer order cannot be considered insubordination where employee cited reason for said refusal, such (sic) as that of being away from the family.[10] (Underscoring supplied by the Labor Arbiter) The Labor Arbiter reasoned that Galanidas transfer was inconvenient and prejudicial because Galanida would have to incur additional expenses for board, lodging and travel. On the other hand, the Labor Arbiter held that Allied Bank failed to show any business urgency that would justify the transfer. The Labor Arbiter also gave credence to Galanidas claim that Allied Bank gave Ms. Co special treatment. The Labor Arbiter stated that Allied Bank deliberately left out Ms. Cos name from the list of accountants transferred to Cebu as contained in Allied Banks letter dated 13 June 1994. However, Mr. Regidor Olveda, Allied Banks Vice President for Operations Accounting, testified that the bank transferred Ms. Co to the Tabunok, Cebu branch within the first half of 1994.

Still, the Labor Arbiter declined to award Galanida back wages because he was not entirely free from blame. Since another bank had already employed Galanida, the Labor Arbiter granted Galanida separation pay in lieu of reinstatement. The dispositive portion of the Labor Arbiters Decision of 23 December 1997 provides: WHEREFORE, premises considered, judgment is hereby rendered ordering respondent Allied Banking Corporation to pay complainant the aggregate total amount of Three Hundred Twenty Four Thousand Pesos (P324,000.00) representing the following awards: a) Separation pay for P272,000.00; b) Quarter bonus for 1994 P16,000.00; c) 13th month pay for 1994 P16,000.00; d) Refund of contribution to Provident Fund ­ P20,000.00. SO ORDERED.[11]

The Ruling of the NLRC On appeal, the NLRC likewise ruled that Allied Bank terminated Galanida without just cause. The NLRC agreed that the transfer order was unreasonable and unjustified, considering the family considerations mentioned by Galanida. The NLRC characterized the transfer as a demotion since the Bacolod and Tagbilaran branches were smaller than the Jakosalem branch, a regional office, and because the bank wanted Galanida, an assistant manager, to replace an assistant accountant in the Tagbilaran branch. The NLRC found unlawful discrimination since Allied Bank did not transfer several junior accountants in Cebu. The NLRC also held that Allied Bank gave Ms. Co special treatment by assigning her to Cebu even though she had worked for the bank for less than two years. The NLRC ruled that Galanidas termination was illegal for lack of due process. The NLRC stated that Allied Bank did not conduct any hearing. The NLRC declared that Allied Bank failed to send a termination notice, as required by law for a valid termination. The Memo merely stated that Allied Bank would issue a notice of termination, but the bank did not issue any notice. The NLRC concluded that Allied Bank dismissed Galanida in bad faith, tantamount to an unfair labor practice as the dismissal undermined Galanidas right to security of tenure and equal protection of the laws. On these grounds, the NLRC promulgated its Decision of 18 September 1998, the relevant portion of which states: In this particular case, We view as impractical, unrealistic and no longer advantageous to both parties to order reinstatement of the complainant. xxx For lack of sufficient basis, We deny the claim for 1994 quarter bonus. Likewise, no attorneys fees is awarded as counsels for complainant­appellee are from the City Prosecutors Office of Cebu. WHEREFORE, premises considered, the decision of the Labor Arbiter dated December 23, 1997 is hereby MODIFIED by increasing the award of separation pay and granting in addition thereto backwages, moral and exemplary damages. The respondent­appellant, ALLIED BANKING CORPORATION, is thus ordered to pay to herein complainant­appellee, POTENCIANO L. GALANIDA, the following amounts: a) P336,000.00, representing separation pay b) P833,600.00, representing backwages c) P 5,333.23 representing proportional 1994 13th month pay d) P 20,000.00 representing refund of Provident Fund Contribution e) P 50,000.00 representing moral damages f) P 20,000.00 representing exemplary damages =========== P1,264,933.33 TOTAL AWARD All other claims are dismissed for lack of basis. The other respondents are dropped for lack of sufficient basis that they acted in excess of their corporate powers. SO ORDERED.[12]

Allied Bank filed a motion for reconsideration which the NLRC denied in its Resolution of 24 December 1998.[13]

Dissatisfied, Allied Bank filed a petition for review questioning the Decision and Resolution of the NLRC before the Court of Appeals. The Ruling of the Court of Appeals

Citing Dosch v. NLRC,[14] the Court of Appeals held that Galanidas refusal to comply with the transfer orders did not warrant his dismissal. The appellate court ruled that the transfer from a regional office to the smaller Bacolod or Tagbilaran branches was effectively a demotion. The appellate court agreed that Allied Bank did not afford Galanida procedural due process because there was no hearing and no notice of termination. The Memo merely stated that the bank would issue a notice of termination but there was no such notice. The Court of Appeals affirmed the ruling of the NLRC in its Decision of 27 April 2000, thus: WHEREFORE, for lack of merit, the petition is DISMISSED and the assailed Decision of public respondent NLRC is AFFIRMED. SO ORDERED. [15]

Allied Bank filed a motion for reconsideration which the appellate court denied in its Resolution of 8 August 2000.[16]

On 26 April 2001, Allied Bank appealed the appellate courts decision and resolution to the Supreme Court. Allied Bank prayed that the Supreme Court: (1) issue a temporary restraining order or writ of preliminary injunction ex parte to restrain the implementation or execution of the questioned Decision and Resolution; (2) declare Galanidas termination as valid and legal; (3) set aside the Court of Appeals Decision and Resolution; (4) make permanent the restraining order or preliminary injunction; (5) order Galanida to pay the costs; and (6) order other equitable reliefs.

The Issues Allied Bank raises the following issues: 1. WHETHER UNDER THE FACTS PRESENTED THERE IS LEGAL BASIS IN PETITIONERS EXERCISE OF ITS MANAGEMENT PREROGATIVE. 2. WHETHER PRIVATE RESPONDENTS VIOLATIONS OF COMPANY RULES CONSTITUTE A GROUND TOWARRANT THE PENALTY OF DISMISSAL. 3. WHETHER UNDER THE FACTS PRESENTED, THERE IS LEGAL BASIS TO HOLD THAT ALLIED BANK AFFORDED PRIVATE RESPONDENT THE REQUIRED DUE PROCESS. 4. WHETHER UNDER THE FACTS, THERE IS LEGAL BASIS TO HOLD THAT PRIVATE RESPONDENT CANNOT RECOVER ANY MONETARY AWARD.[17]

In sum, Allied Bank argues that the transfer of Galanida was a valid exercise of its management prerogative. Allied Bank contends that Galanidas continued refusal to obey the transfer orders constituted willful disobedience or insubordination, which is a just cause for termination under the Labor Code. On the other hand, Galanida defended his right to refuse the transfer order. The memorandum for Galanida filed with this Court, prepared by Atty. Loreto M. Durano, againmisquoted the Courts ruling in Dosch v. NLRC, thus: xxx His [Galanidas] refusal to transfer falls well within the ruling of the Supreme Court in Helmut Dosch vs. NLRC, et. al., 123 SCRA 296 (1983) quoted as follows: xxx Refusal to obey a transfer order cannot be considered insubordination where employee cited reason for said refusal, such as that of being away from the family.[18]

The Ruling of the Court The petition is partly meritorious.

Preliminary Matter: Misquoting Decisions of the Supreme Court The memorandum prepared by Atty. Durano and, worse, the assailed Decision of the Labor Arbiter, bothmisquotedthe Supreme Courts ruling in Dosch v. NLRC. The Court held in Dosch: We cannot agree to Northwests submission that petitioner was guilty of disobedience and insubordination which respondent Commission sustained. The only piece of evidence on which Northwest bases the charge of contumacious refusal is petitioners letter dated August 28, 1975 to R.C. Jenkins wherein petitioner acknowledged receipt of the formers memorandum dated August 18, 1975, appreciated his promotion to Director of International Sales but at the same time regretted that at this time for personal reasons and reasons of my family, I am unable to accept the transfer from the Philippines and thereafter expressed his preference to remain in his position, saying: I would, therefore, prefer to remain in my position of Manager­Philippines until such time that my services in that capacity are no longer required by Northwest Airlines. From this evidence, We cannot discern even the slightest hint of defiance, much less imply insubordination on the part of petitioner.[19]

The phrase [r]efusal to obey a transfer order cannot be considered insubordination where employee cited reason for said refusal, such as that of being away from the family does not appear anywhere in the Dosch decision. Galanidas counsel lifted the erroneous phrase from one of the italicized lines in the syllabus of Dosch found in the Supreme Court Reports Annotated (SCRA). The syllabus of cases in official or unofficial reports of Supreme Court decisions or resolutions is not the work of the Court, nor does it state this Courts decision. The syllabus is simply the work of the reporter who gives his understanding of the decision. The reporter writes the syllabus for the convenience of lawyers in reading the reports. A syllabus is not a part of the courts decision.[20] A counsel should not cite a syllabus in place of the carefully considered text in the decision of the Court. In the present case, Labor Arbiter Almirante and Atty. Durano began by quoting from Dosch, but substituted a portion of the decision with a headnote from the SCRA syllabus, which they even underscored. In short, they deliberately made the quote from the SCRA syllabus appear as the words of the Supreme Court. We admonish them for what is at the least patent carelessness, if not an outright attempt to mislead the parties and the courts taking cognizance of this case. Rule 10.02, Canon 10 of the Code of Professional Responsibility mandates that a lawyer shall not

knowingly misquote or misrepresent the text of a decision or authority. It is the duty of all officers of the court to cite the rulings and decisions of the Supreme Court accurately.[21]

Whether Galanida was dismissed for just cause We accord great weight and even finality to the factual findings of the Court of Appeals, particularly when they affirm the findings of the NLRC or the lower courts. However, there are recognized exceptions to this rule. These exceptions are: (1) when the findings are grounded on speculation, surmise and conjecture; (2) when the inference made is manifestly mistaken, absurd or impossible; (3) when there is grave abuse of discretion in the appreciation of facts; (4) when the factual findings of the trial and appellate courts are conflicting; (5) when the Court of Appeals, in making its findings, has gone beyond the issues of the case and such findings are contrary to the admissions of both appellant and appellee; (6) when the judgment of the appellate court is premised on a misapprehension of facts or when it has failed to consider certain relevant facts which, if properly considered, will justify a different conclusion; (7) when the findings of fact are conclusions without citation of specific evidence on which they are based; and (8) when the findings of fact of the Court of Appeals are premised on the absence of evidence but are contradicted by the evidence on record.[22] After a scrutiny of the records, we find that some of these exceptions obtain in the present case. The rule is that the transfer of an employee ordinarily lies within the ambit of the employers prerogatives.[23] The employer exercises the prerogative to transfer an employee for valid reasons and according to the requirement of its business, provided the transfer does not result in demotion in rank or diminution of the employees salary, benefits and other privileges.[24] In illegal dismissal cases, the employer has the burden of showing that the transfer is not unnecessary, inconvenient and prejudicial to the displaced employee.[25]

The constant transfer of bank officers and personnel with accounting responsibilities from one branch to another is a standard practice of Allied Bank, which has more than a hundred branches throughout the country.[26] Allied Bank does this primarily for internal control. It also enables bank employees to gain the necessary experience for eventual promotion. The Bangko Sentral ng Pilipinas, in its Manual of Regulations for Banks and Other Financial Intermediaries,[27] requires the rotation of these personnel. The Manual directs that the duties of personnel handling cash, securities and bookkeeping records should be rotated and that such rotation should be irregular, unannounced and long enough to permit disclosure of any irregularities or manipulations.[28]

Galanida was well aware of Allied Banks policy of periodically transferring personnel to different branches. As the Court of Appeals found, assignment to the different branches of Allied Bank was a condition of Galanidas employment. Galanida consented to this condition when he signed the Notice of Personnel Action.[29]

The evidence on record contradicts the charge that Allied Bank discriminated against Galanida and was in bad faith when it ordered his transfer. Allied Banks letter of 13 June 1994[30] showed that at least 14 accounting officers and personnel from various branches, including Galanida, were transferred to other branches. Allied Bank did not single out Galanida. The same letter explained that Galanida was second in line for assignment outside Cebu because he had been in Cebu for seven years already. The person first in line, Assistant Manager Roberto Isla, who had been in Cebu for more than ten years, had already transferred to a branch in Cagayan de Oro City. We note that none of the other transferees joined Galanida in his complaint or corroborated his allegations of widespread discrimination and favoritism. As regards Ms. Co, Galanidas letter of 16 June 1994 itself showed that her assignment to Cebu was not in any way related to Galanidas transfer. Ms. Co was supposed to replace a certain Larry Sabelino in the Tabunok branch. The employer has the prerogative, based on its assessment of the employees qualifications and competence, to rotate them in the various areas of its business operations to ascertain where they will function with maximum benefit to the company.[31]

Neither was Galanidas transfer in the nature of a demotion. Galanida did not present evidence showing that the transfer would diminish his salary, benefits or other privileges. Instead, Allied Banks letter of 13 June 1994 assured Galanida that he would not suffer any reduction in rank or grade, and that the transfer would involve the same rank, duties and obligations. Mr. Olveda explained this further in the affidavit he submitted to the Labor Arbiter, thus: 19. There is no demotion in position/rank or diminution of complainants salary, benefits and other privileges as the transfer/assignment of branch officers is premised on the role/functions that they will assume in the management and operations of the branch, as shown below: (a) The Branch Accountant, as controller of the branch is responsible for the proper discharge of the functions of the accounting section of the branch, review of documentation/proper accounting and control of transaction. As such, the accounting functions in the branch can be assumed by any of the following officers with the rank of: Senior Manager/Acctg.; Manager/ Acctg.; Senior Asst. Manager/Acctg.; Asst. Manager/Acctg.; Accountant or Asst. Accountant. x x x 20. The transfer/assignment of branch officer from one branch, to another branch/office is lateral in nature and carries with it the same position/rank, salary, benefits and other privileges. The assignment/transfer is for the officer to assume the functions relative to his job and NOT the position/rank of the officer to be replaced.

There is also no basis for the finding that Allied Bank was guilty of unfair labor practice in dismissing Galanida. Unfair labor practices relate only to violations of the constitutional right of workers and employees to self­organization[32] and are limited to the acts enumerated in Article 248 of the Labor Code, none of which applies to the present case. There is no evidence that Galanida took part in forming a union, or even that a union existed in Allied Bank. This leaves the issue of whether Galanida could validly refuse the transfer orders on the ground of parental obligations, additional expenses, and the anguish he would suffer if assigned away from his family. The Court has ruled on this issue before. In the case of Homeowners Savings and Loan Association, Inc. v. NLRC,[33] we held: The acceptability of the proposition that transfer made by an employer for an illicit or underhanded purpose i.e., to defeat an employees right to self­organization, to rid himself of an undesirable worker, or to penalize an employee for union activities cannot be upheld is self­evident and cannot be gainsaid. The difficulty lies in the situation where no such illicit, improper or underhanded purpose can be ascribed to the employer, the objection to the transfer being grounded solely upon the personal inconvenience or hardship that will be caused to the employee by reason of the transfer. What then? This was the very same situation we faced in Phil. Telegraph and Telephone Corp. v. Laplana. In that case, the employee, Alicia Laplana, was a cashier at the Baguio City Branch of PT&T who was directed to transfer to the companys branch office at Laoag City. In refusing the transfer, the employee averred that she had established Baguio City as her permanent residence and that such transfer will involve additional expenses on her part, plus the fact that an assignment to a far place will be a big sacrifice for her as she will be kept away from her family which might adversely affect her efficiency. In ruling for the employer, the Court upheld the transfer from one city to another within the country as valid as long as there is no bad faith on the part of the employer. We held then: Certainly the Court cannot accept the proposition that when an employee opposes his employers decision to transfer him to another work place, there being no bad faith or underhanded motives on the part of either party, it is the employees wishes that should be made to prevail. Galanida, through counsel, invokes the Courts ruling in Dosch v. NLRC.[34] Dosch, however, is not applicable to the present case. Helmut Dosch refused a transfer consequential to a promotion. We upheld the refusal because no law compels an employee to accept a promotion, and because the position Dosch was supposed to be promoted to did not even exist at that time.[35] This left as the only basis for the charge of insubordination a letter from Dosch in which the Court found not even the slightest hint of defiance, much less xxx insubordination.[36]

Moreover, the transfer of an employee to an overseas post, as in theDoschcase, cannot be likened to a transfer from one city to another within the country,[37] which is the situation in the present case. The distance from Cebu City to Bacolod City or from Cebu City to Tagbilaran City does not exceed the distance from Baguio City to Laoag City or from Baguio City to Manila, which the Court considered a reasonable distance in PT&T v. Laplana.[38]

The refusal to obey a valid transfer order constitutes willful disobedience of a lawful order of an employer.[39] Employees may object to, negotiate and seek redress against employers for rules or orders that they regard as unjust or illegal. However, until and unless these rules or orders are declared illegal or improper by competent authority, the employees ignore or disobey them at their peril.[40] For Galanidas continued refusal to obey Allied Banks transfer orders, we hold that the bank dismissed Galanida for just cause in accordance with Article 282 (a) of the Labor Code.[41] Galanida is thus not entitled to reinstatement or to separation pay.

Whether Galanidas dismissal violated the requirement of notice and hearing

To be effective, a dismissal must comply with Section 2 (d), Rule 1, Book VI of the Omnibus Rules Implementing the Labor Code (Omnibus Rules), which provides: For termination of employment based on just causes as defined in Article 282 of the Labor Code:

(i) A written notice served on the employee specifying the ground or grounds of termination, and giving said employee reasonable opportunity within which to explain his side.

(ii) A hearing or conference during which the employee concerned, with the assistance of counsel if he so desires is given opportunity to respond to the charge, present his evidence, or rebut the evidence presented against him.

(iii) A written notice of termination served on the employee indicating that upon due consideration of all the circumstances, grounds have been established to justify his termination.

The first written notice was embodied in Allied Banks letter of 13 June 1994. The first notice required Galanida to explain why no disciplinary action should be taken against him for his refusal to comply with the transfer orders. On the requirement of a hearing, this Court has held that the essence of due process is simply an opportunity to be heard.[42] An actual hearing is not necessary. The exchange of several letters, in which Galanidas wife, a lawyer with the City Prosecutors Office, assisted him, gave Galanida an opportunity to respond to the charges against him.

The remaining issue is whether the Memo dated 8 September 1994 sent to Galanida constitutes the written notice of termination required by the Omnibus Rules. In finding that it did not, the Court of Appeals and the NLRC cited Allied Banks rule on dismissals, quoted in the Memo, that, Notice of termination shall be issued by the Investigation Committee subject to the confirmation of the President or his authorized representative.[43] The appellate court and NLRC held that Allied Bank did not send any notice of termination to Galanida. The Memo, with the heading Transfer and Reassignment, was not the termination notice required by law. We do not agree. Even a cursory reading of the Memo will show that it unequivocally informed Galanida of Allied Banks decision to dismiss him. The statement, please be informed that the Bank has terminated your serviceseffective September 1, 1994 and considered whatever benefit, if any, that you are entitled [to] as forfeited xxx[44] is plainly worded and needs no interpretation. The Memo also discussed the findings of the Investigation Committee that served as grounds for Galanidas dismissal. The Memo referred to Galanidas open defiance and refusal to transfer first to the Bacolod City branch and then to the Tagbilaran City branch. The Memo also mentioned his continued refusal to report for work despite the denial of his application for additional vacation leave.[45] The Memo also refuted Galanidas charges of discrimination and demotion, and concluded that he had violated Article XII of the banks Employee Discipline Policy and Procedure. The Memo, although captioned Transfer and Reassignment, did not preclude it from being a notice of termination. The Court has held that the nature of an instrument is characterized not by the title given to it but by its body and contents.[46] Moreover, it appears that Galanida himself regarded the Memo as a notice of termination. We quote from the Memorandum for Private Respondent­Appellee, as follows: The proceedings may be capsulized as follows: 1. On March 13, 1994[47] Private Respondent­Appellee filed before the Region VII Arbitration Branch a Complaint for Constructive Dismissal. A copy of the Complaint is attached to the Petition as Annex H; xxx 5. On September 8, 1994, Petitioner­Appellant issued him a Letter of Termination. A copy of said letter is attached to the Petition as Annex N; 6. Private Respondent­Appellee filed an Amended/ Supplemental Complaint wherein he alleged illegal dismissal. A copy of the Amended/Supplemental Complaint is attached to the Petition as Annex O; xxx [48] (Emphasis supplied) The Memorandum for Private Respondent­Appellee refers to the Memo as a Letter of Termination. Further, Galanida amended his complaint for constructive dismissal[49] to one for illegal dismissal[50] after he received the Memo. Clearly, Galanida had understood the Memo to mean that Allied Bank had terminated his services. The Memo complied with Allied Banks internal rules which required the banks Presidentorhis authorized representative to confirm the notice of termination. The banks Vice­President for Personnel, as the head of the department that handles the movement of personnel within Allied Bank, can certainly represent the bank president in cases involving the dismissal of employees. Nevertheless, we agree that the Memo suffered from certain errors. Although the Memo stated that Allied Bank terminated Galanidas services as of 1 September 1994, the Memo bore the date 8 September 1994. More importantly, Galanida only received a copy of the Memo on 5 October 1994, or more than a month after the supposed date of his dismissal. To be effective, a written notice of termination must beserved on the employee.[51] Allied Bank could not terminate Galanida on 1 September 1994 because he had not received as of that date the notice of Allied Banks decision to dismiss him. Galanidas dismissal could only take effect on 5 October 1994, upon his receipt of the Memo. For this reason, Galanida is entitled to backwages for the period from 1 September 1994 to 4 October 1994. Under the circumstances, we also find an award of P10,000 in nominal damages proper. Courts award nominal damages to recognize or vindicate the right of a person that another has violated.[52] The law entitles Galanida to receive timely notice of Allied Banks decision to dismiss him. Allied Bank should have exercised more care in issuing the notice of termination. WHEREFORE, the Decision of 27 April 2000 of the Court of Appeals in CA­G.R. SP No. 51451 upholding the Decision of 18 September 1998 of the NLRC in NLRC Case No. V­000180­98 is AFFIRMED, with the following MODIFICATIONS: 1) The awards of separation pay, moral damages and exemplary damages are hereby deleted for lack of basis; 2) Reducing the award of backwages to cover only the period from 1 September 1994 to 4 October 1994; and 3) Awarding nominal damages to private respondent for P10,000. This case is REMANDED to the Labor Arbiter for the computation, within thirty (30) days from receipt of this Decision, of the backwages, inclusive of allowances and other benefits, due to Potenciano L. Galanida for the time his dismissal was ineffectual from 1 September 1994 until 4 October 1994. Labor Arbiter Dominador A. Almirante and Atty. Loreto M. Durano are ADMONISHED to be more careful in citing the decisions of the Supreme Court in the future. SO ORDERED.

Davide, Jr., C.J., (Chairman), Panganiban, Ynares­Santiago, and Azcuna, JJ., concur.

SECOND DIVISION

[G.R. No. 131502. June 8, 2000] WILSON ONG CHING KIAN CHUNG and THE DIRECTOR OF THE NATIONAL LIBRARY, petitioners, vs. CHINA NATIONAL CEREALS OIL AND FOODSTUFFS IMPORT AND EXPORT CORP., CEROILFOOD SHANDONG CEREAL AND OILS and BENJAMIN IRAO, JR., respondents.

D E C I S I O N BUENA, J.: This is an appeal by way of a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure of the Decision[1] in Civil Case No. 94­68836 dated November 20, 1997 of the Regional Trial Court, Branch 33, Manila, which rendered a judgment on the pleadings against herein petitioners, the dispositive portion of which reads: "WHEREFORE, judgment is hereby rendered in favor of plaintiffs, and against defendant: "1. Decreeing the cancellation or annulment of the Copyrighted Registration No. 0­93­491 of defendant WILSON ONG; "2. Directing defendant Director of the National Library to effect the cancellation or annulment of the Copyrighted Registration No. 0­93­491 of defendant WILSON ONG; and "Damages cannot be awarded to Plaintiffs as no evidence was presented to substantiate their claims. "With costs against defendant WILSON ONG. "SO ORDERED."[2]

The antecedent facts are undisputed. On September 16, 1993, petitioner Wilson Ong Ching Kian Chuan, doing business under the firm name of C.K.C. Trading, filed a Complaint for Infringement of Copyright with prayer for writ of injunction before the Regional Trial Court, Branch 94 of Quezon City (hereinafter Quezon City Court) against Lorenzo Tan, doing business under the firm name Mcmaster International Sales, and docketed as Q­93­17628. On the same day, said court issued a temporary restraining order enjoining the defendant, his distributors and retailers from selling vermicelli (sotanghon) "using the plaintiffs copyrighted cellophane wrapper with the two­dragons designed label, and setting the hearing of the injunctive relief for September 21, 1993." On October 13, 1993, the Quezon City Court issued a Resolution which granted a writ of preliminary injunction in favor of the petitioner, denied therein defendants application for a writ of preliminary injunction and, issues having been joined, set the case for pre­trial on November 12, 1993. On December 15, 1993, the Quezon City Court denied defendants motion for dissolution of the writ of preliminary injunction. On January 5, 1994, the China National Cereals Oils & Foodstuffs Import and Export Corporation (CEROILFOOD SHANDONG), and Benjamin Irao, Jr., as representative and attorney­in­fact of CEROILFOOD SHANDONG, herein respondents, filed a complaint[3] for Annulment/Cancellation of Copyrighted Certificate No. 0­93­491 and damages with prayer for restraining order/writ of preliminary injunction before the Regional Trial Court of Manila, (hereinafter Manila Court) against Wilson Ong Ching Kian Chuan, doing business under the firm name and style C.K.C. Trading and the Director of the National Library, docketed as Civil Case No. 94­68836. On January 7, 1994, Judge Rodolfo G. Palattao of the Manila Court issued a temporary restraining order[4] enjoining petitioner from using his copyrighted labels and selling his vermicelli products which is similar to that of respondents. On January 14, 1994, petitioner filed a motion to dissolve temporary restraining order[5] praying that the complaint be dismissed on the following grounds: 1.) litis pendentia, 2.) the issue involved is one of copyright under PD No. 49 and does not involve trademarks under Republic Act 166, 3.) courts of co­equal and coordinate jurisdiction cannot interfere with the orders of other courts having the same power and jurisdiction, 4.) plaintiff CEROILFOOD SHANDONG, being a foreign corporation and with no license to do business in the Philippines, has no legal capacity to sue, and 5.) courts should not issue injunctions which would in effect dispose of the main case without trial. On January 27, 1994, the Manila Court issued an Order[6] granting a writ of preliminary injunction in favor of respondents and denying petitioners motion to dismiss. On January 31, 1994, petitioner filed before the Court of Appeals a petition for certiorari docketed as CA ­ G.R. SP No. 33178, seeking for the annulment of the January 27, 1994 Order of the Manila Court. On July 22, 1994, after the parties have expounded their respective positions by way of their comment, reply and rejoinder, the Court of Appeals rendered its Decision,[7] the dispositive portion of which reads:

"WHEREFORE, the instant petition is hereby GRANTED, and as prayed for by petitioner, the Order dated January 27, 1994 issued in Civil Case 94­68836 by Branch 33, Regional Trial Court, National Capital Judicial Region, Manila, is hereby ANNULLED and SET ASIDE, although the prayer for dismissal of the complaint in Manila may be pursued before said court during the proceedings." In the same Decision, the Court of Appeals ruled that the case was dismissible on grounds of litis pendentia, multiplicity of suits, and forum shopping. On September 5, 1994, the Court of Appeals denied respondents motion for reconsideration.[8] The Court of Appeals Decision became final on October 3, 1994. Entry of Judgment[9]was made on November 15, 1994. On November 21, 1994, petitioner filed a motion[10] praying for the dismissal of the Manila case on the strength of the findings of the Court of Appeals, particularly on "forum shopping." In an Order[11] dated March 8, 1995, the Manila Court held in abeyance the resolution of the motion to dismiss until further reception of evidence, stating therein that the dispositive portion of the Court of Appeals Decision did not order the dismissal of the case. In the meantime, respondents filed a motion to declare petitioners in default for failing to file an Answer despite the March 8 Order, which motion was opposed by petitioners, there being at that time a pending motion to dismiss which the court a quo refused to resolve on the merits. In an Order[12] dated July 19, 1996, the Manila court denied the motion to declare petitioners in default, admitted motu proprio the motion to dismiss filed by petitioner as its answer, and directed the parties to submit their respective pre­trial briefs. On September 17, 1996, petitioner filed a "Motion for the Issuance of a Writ of Execution"[13] praying that a motion for execution dismissing the Manila case be issued, and citing Atty. Benjamin Irao, Jr., counsel of CEROILFOOD SHANDONG and his co­counsel, Atty. Antonio Albano, guilty of forum shopping, pursuant to the Decision of the Court of Appeals in CA­G.R. SP. No. 33178. On January 23, 1997, respondents filed before the Manila court a Supplement To Motion For Judgment On The Pleadings, claiming that petitioner failed to tender an issue.[14]

On November 20, 1997, Judge Rodolfo G. Palattao of the Manila Court rendered a Judgment on the Pleadings in favor of respondents, and ruled that litis pendentia, multiplicity of suits, and forum shopping were not present in the case. Hence, the present appeal on pure questions of law. Petitioners raise the following issues:

I Whether or not the legal pronouncements of the Court of Appeals in CA­G.R. SP No. 33178 that the Manila case is dismissible on grounds of litis pendentia, multiplicity of suits and forum shopping constitute the "Law of the Case."

II Whether or not the Regional Trial Judge of Branch 33, Manila erred in not applying the law of the case.

III Whether or not the court a quo can review the legal conclusions of an appellate court in the same case, on issues squarely submitted to and passed upon by the appellate court under identical set of facts and circumstances obtaining in the court a quo.

IV Whether or not the court a quo erred in motu proprio considering a motion to dismiss as the answer to the complaint and, thereafter, render a judgment on the pleadings on the ground that the motion to dismiss did not tender an issue.[15]

In support thereof, petitioners quote the ruling of the Court of Appeals on the issue of whether there was litis pendentia and multiplicity of suits in the present case, as follows: "The Manila court should have considered also that Civil Case Q­93­17628 involves practically the same parties, same subject­matter and same relief as in Civil Case 0­94­68836. Petitioner filed the first case on September 16, 1993, for INFRINGEMENT OF HIS REGISTERED COPYRIGHT, which covers the cellophane wrapper that he uses in packaging the vermicelli which he imports from the CHINA NATIONAL CEREALS OILS & FOODSTUFFS IMPORT AND EXPORT CORPORATION BASED IN BEIJING, CHINA, the main or principal of private respondent CEROILFOOD SHANDONG, the latter being the branch of CEROILFOOD in Quingdao, China, and of which in Civil Case Q­93­17628, LORENZO TAN avers in his answer he is the exclusive and sole distributor. In Civil Case 94­68836 subsequently filed in Manila, on January 5, 1994, LORENZO TAN admitted that he is the sole distributor of plaintiff China National Cereals Oil and Foodstuffs Import and Export Corporation of the latters PAGODA BRAND vermicelli products. Atty. Benjamin Irao, Jr., the attorney of private respondents, also the attorney­in­fact of Ceroilfood Shandong, admitted that his principal does not do business in the Philippines, and named LORENZO TAN as his principals exclusive distributor of said product in the Philippines. Thus, Lorenzo Tan in both Civil Cases Q­93­17628 and 94­68836 appears as principal defendant in the first, and as sole distributor of Cereal Food Shandong, in the second. Indicatively, he is defending and complaining substantively the same rights and interests in both cases, and in effect there is identity of parties representing the same interests. While it is against TAN with whom the QC RTC issued an injunction, that writ should also apply to CEROILFOOD SHANDONG, as Tan is its exclusive and

sole distributor in the Philippines, as private respondent corporation does business in the Philippines through TAN who imports his vermicelli wholly from said foreign corporation. And most importantly, TAN asserts rights to the trademark PAGODA, also allegedly owned by CEROILFOOD between TAN and CEROILFOOD SHANDONG that he is its corporate distributor. Also in 93­17628, petitioners prayer for injunction is based on his registered copyright certificate, while TAN averred in his answer thereon that petitioners copyright should be annulled and cancelled, and also prayed for injunction. In 94­68836, private respondent CEROILFOOD SHANDONG, as plaintiff, also prayed for ANNULMENT AND CANCELLATION OF COPYRIGHT CERTIFICATE No. 0­93­491 WITH DAMAGES AND PRAYER FOR RESTRAINING ORDER/WRIT OF PRELIMINARY INJUNCTION. As can well be seen from those pertinent allegations/averments/prayers in both cases, they are identical with each other. They involved one and the same CERTIFICATE OF COPYRIGHT REGISTRATION. Though the first case is for INFRINGEMENT of copyright registration, while the second is for ANNULMENT AND CANCELLATION of the same copyright, since the first involves a breach, infraction, transgression, and the second for invalidation, discontinuance, termination and suppression of the same copyright certificate, what the first seeks to preserve is the exclusive use of the copyright, and the second seeks to terminate the very use of the same copyright by the registrant/owner. Though the quest of petitioner and private respondents in the two cases are aimed towards different ends ­ the first to uphold the validity and effectiveness of the same copyright, the second is merely a consequence of the first, ­ the real matter in controversy can be fully determined and resolved before the Quezon City court, and would render the Manila case a surplus age and also constitutes multiplicity of suits and dismissible on that ground, although such dismissal should be considered as without prejudice to the continuance of the proceedings before the Quezon City court. (pp. 8­10, CA Decision, Annex "B" of the Petition)" On the issue of forum shopping, the Court of Appeals ruled further, thus: "Finally, the Manila court should also have considered forum shopping as a third drawback to private respondents cause. It is a term originally used to denominate a litigants privilege of choosing the venue of his action where the law allows him to do so, or of an election of remedies of one of two or more co­existing rights. In either of which situations, the litigant actually shops for a forum of his action. However, instead of making a choice of the forum of their actions, litigants through the encouragement of their lawyers, file their actions on all available courts, or invoke irrelevant remedies simultaneously, or even file actions one after the other, a practice which had not only resulted conflicting adjudications among different courts, confusion inimical to an orderly administration of justice and created extreme inconvenience to some of the parties to the action. And thus it has been held in Villanueva vs. Andres, 172 SCRA 876, that forum shopping applies whenever as a result of an adverse opinion in one forum, a party seeks a favorable opinion (other than by appeal or certiorari), in another forum. xxx "Observedly, Attys. IRAO and ALBANO, who are TANs lawyers in Quezon City, are also private respondents lawyers in Manila. ATTY. IRAO who entered his appearance as counsel for private respondents in the Manila case, is also the authorized representative and attorney­in­fact of private respondent corporation in the Manila case. While Atty. Irao withdrew as counsel of TAN in the Quezon City, that did not remove the case filed in Manila outside the sphere of the rule on forum shopping." (pp. 10­11, CA Decision, Annex "B" of the Petition) Petitioners contend that the foregoing conclusions of fact and law of the Court of Appeals are correct and should not be disturbed, especially since the decision of the Court of Appeals had already become final and entered in the Books of Judgment; that the parties to the case and the Regional Trial Judge in Branch 33, Manila are bound by the said conclusions of fact and law and the same should not be reopened on remand of the case; and that it is not within the Trial Judges discretion to take exception to, much less overturn, any factual or legal conclusions laid down by the Court of Appeals in its verdict and to dispose of the case in a manner diametrically opposed thereto, citing the case ofPNB vs. Noahs Ark Sugar Refinery, 226 SCRA 36, 48. Petitioners further allege that the acts of the trial judge suffer from procedural infirmity: and that it makes no sense for the trial judge to refuse to resolve the motion to dismiss on the merits; to motu proprio consider the motion to dismiss as the answer to the complaint; and to later rule that the motion to dismiss did not tender an issue and, therefore, a judgment on the pleadings is in order. Petitioners also aver that a motion to dismiss is not a responsive pleading (citing Prudence Realty Development Corporation vs. CA, 231 SCRA 379); that at the time the trial judge considered the motion to dismiss to be the answer to the complaint, he knew very well, or at least should have known that the motion to dismiss did not tender an issue for indeed, it is not within the province of the motion to admit or deny the allegations of the complaint, and there being no legitimate answer and no real joinder of issues, the rendition of the subject Judgment on the Pleadings becomes suspect. According to petitioners, in deviating from the usual procedure, the court a quo gave undue benefit and advantage to the respondents at the expense of herein petitioners; and that the explanation given by the trial judge that the dispositive portion of the Court of Appeals decision did not expressly order him to dismiss the case is flimsy and untenable. On the other hand, respondents assert that the doctrine of law of the case is not applicable to the present case because the Court of Appeals never ordered the dismissal of the case and that the Order of the Manila Court dated January 27, 1994 was annulled and set aside only insofar as the preliminary injunction is concerned. Respondents cite the case of Magdalena Estate, Inc. vs. Caluag, 11 SCRA 333 which ruled that the deficiencies in the dispositive part of the decision cannot be supplied by any finding or opinion found in the body of the decision. Respondents

also allege that while petitioner Wilson Ong had belatedly faulted the Court below in considering his motion to dismiss as his answer, he never questioned the correctness of the findings of the court a quo in the assailed decision. After a review of the records of the case and an examination of the pleadings filed by the parties, the Court finds the petition to be meritorious. Being interrelated, the first, second and third issues shall be discussed jointly. Indeed, the court a quo erred in not resolving the petitioners motion to dismiss in accordance with the decision of the Court of Appeals which found that "The Manila court should have considered also that Civil Case Q­93­17628 involves practically the same parties, same subject­matter and same relief as in Civil Case 94­68836"; that "the real matter in controversy can be fully determined and resolved before the Quezon City court and would render the Manila case a surplusage and also constitutes multiplicity of suits and dismissible on that ground, although such dismissal should be considered as without prejudice to the continuance of the proceedings before the Quezon City court"; and that "the Manila court should also have considered forum shopping as a third drawback to private respondents cause." While the Court of Appeals stated in the dispositive portion of its decision that "the prayer for dismissal of the complaint in Manila may be pursued before said court during the proceedings," it is clear from the body of the Court of Appeals Decision that the case before the Manila court should be dismissed on grounds of litis pendentia, and forum shopping. While the general rule is that the portion of a decision that becomes the subject of execution is that ordained or decreed in the dispositive part thereof, there are exceptions to this rule. The exceptions where the dispositive part of the judgment does not always prevail over the body of the opinion are: (a)....where there is ambiguity or uncertainty, the body of the opinion may be referred to for purposes of construing the judgment because the dispositive part of a decision must find support from the decisions ratio decidendi;[16]

(b)....where extensive and explicit discussion and settlement of the issue is found in the body of the decision.[17]

Considering the circumstances of the instant case, the Court finds that the exception to the general rule applies to the instant case. Since the statement of the Court of Appeals regarding the prayer for the dismissal of the case seemingly gave the Manila court the discretion to dismiss or not to dismiss Civil Case No. 94­68836, the Manila court should have referred to the body of the decision for purposes of construing the issue of whether or not the complaint should be dismissed, because the dispositive part of a decision must find support from the decisions ratio decidendi. Findings of the court are to be considered in the interpretation of the dispositive portion of the judgment.[18] Moreover, extensive and explicit discussion and settlement of the issues are found in the body of the Court of Appeals decision so that it is grave error for the court a quo to rule again, as it did, on the issues of litis pendentia and forum shopping in its decision, and to overturn that of the Court of Appeals, thus: "The argument of Defendant Ong in his motion for execution that the case at bench should now be dismissed on the grounds of forum shopping and litis pendentia as allegedly ruled by the Court of Appeals, does not impress this Court. For while the appellate court urged this Court to consider litis pendentia and forum shopping in the trial resolution of the case at bench, nowhere in its (CA) decision could it be deduced that this Court is mandated to dismiss the case on these precise grounds. The dispositive portion of the decision does not contain such a mandate."[19]

In Viva Productions, Inc. vs. Court of Appeals,[20] this Court set aside the decision of the Makati court and declared null and void all orders of the RTC of Makati after ruling that: "Thus, we find grave abuse of discretion on the part of the Makati court, being a mere co­equal of the Paraaque court, in not giving due deference to the latter before which the issue of the alleged violation of the sub­judice rule had already been raised and submitted. In such instance, the Makati court, if it was wary of dismissing the action outrightly under administrative Circular No. 04­94, should have, at least ordered the consolidation of its case with that of the Paraaque court, which had first acquired jurisdiction over the related case in accordance with Rule 31 of the Revised Rules of Court." (emphasis ours.) The Quezon City court and the Manila court have concurrent jurisdiction over the case. However, when the Quezon City court acquired jurisdiction over the case, it excluded all other courts of concurrent jurisdiction from acquiring jurisdiction over the same. The Manila court is, therefore, devoid of jurisdiction over the complaint filed resulting in the herein assailed decision which must perforce be declared null and void. To hold otherwise would be to risk instances where courts of concurrent jurisdiction might have conflicting orders.[21]

WHEREFORE, the assailed decision of the Regional Trial Court of Manila, Branch 33 in Civil Case No. 94­68836 is ANNULLED and SET ASIDE. Said case is ordered dismissed without prejudice to the continuance of the proceedings before the Quezon City court where Civil Case No. Q­93­17628 is pending. SO ORDERED. Bellosillo, (Chairman), Mendoza, Quisumbing, and De Leon, Jr., JJ., concur.