Civpro6-9

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CivPro; February 07-08 2014

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RULE 6 Kinds of Pleadings

Financial Building Corporation vs. Forbes Park Association, Inc. G.R.No. 133119, August 17, 2000, 338 SCRA 346 CAMERINO

DOCTRINE: Section 6, Rule 6. Counterclaim. -- A counterclaim is any claim

which a defending party may have against an opposing party.;Section 7, Rule 6. Compulsory Counterclaim. -- a compulsory counterclaimis one which, being cognizable by the regular courts of justice, arises out ofor is connected with the transaction or occurrence constituting the subjectmatter of the opposing partys claim and does not require for its adjudicationthe presence of third parties of whom the court cannot acquire jurisdiction.Such a counterclaim must be within the jurisdiction of the court both as tothe amount and the nature thereof, except that in an original action beforethe Regional Trial Court, the counterclaim may be considered compulsoryregardless of the amount.

FACTS: The then Union of Soviet Socialist Republic (USSR) engagedFinancial Building to construct a multi-level office and staff apartment

building at its residential lot in Forbes Park Village, Makati.

However, based on its existing regulations, Forbes Park only authorized theconstruction of a single-family residential building. Yet, construction of amulti-level apartment building proceeded.

Financial Building submitted to the Makati City Government a second planfor the construction of a multi-level apartment building, which was differentfrom the first plan for the construction of a residential building submitted toForbes Park.

Forbes Park discovered the second plan, enjoined further construction work.Later, Forbes Park restricted entry (personnel and materials) of FinancialBuilding in the construction site.Upon a failed attempt to settle their

differences, Financial Building instead filed a Complaint for Injunction andDamages. Forbes Park, in turn, filed a Motion to Dismiss on the ground thatFinancial Building had no cause of action because it was not the real party-in-interest.

The trial court issued a writ of preliminary injunction against Forbes Park butthe Court of Appeals nullified it and dismissed the complaint altogether. SCaffirmed the said dismissal.

After case was terminated with finality, Forbes Park sought to vindicate i tsrights by filing a Complaint for Damages, against Financial Building.

TRIAL COURTS DECISION: ruled in favor of Forbes Park and againstFinancial Building, ordering defendant to remove/demolish the illegalstructures and to pay damages.

CA's DECISION: Affirmed trial court's decision.

ISSUE: WON claims and causes of action by Forbes Park are barred byprior judgment and/or are deemed waived for its failure to interpose thesame as compulsory counterclaims in the original case.

HELD: The Supreme Court held that the instant case is barred due toForbes Parks failure to set it up as a compulsory counterclaim in the originalcase.

A compulsory counterclaim is one which arises out of or is necessarilyconnected with the transaction or occurrence that is the subject matter of theopposing partys claim.If it is within the jurisdiction of the court and it doesnot require for its adjudication the presence of third parties over whom thecourt cannot acquire jurisdiction, such compulsory counterclaim is barred i f it

is not set up in the action filed by the opposing party.

Thus, a compulsory counterclaim cannot be the subject of a separate actionbut it should instead be asserted in the same suit involving the sametransaction or occurrence, which gave rise to it.To determine whether acounterclaim is compulsory or not, we have devised the following tests: (1)Are the issues of fact or law raised by the claim and the counterclaim largelythe same? (2) Would res judicata bar a subsequent suit on defendants claimabsent the compulsory counterclaim rule? (3) Will substantially the sameevidence support or refute plaintiffs claim as well as the defendantscounterclaim? and (4) Is there any logical relation between the claim and thecounterclaim? Affirmative answers to the above queries indicate theexistence of a compulsory counterclaim.

Undoubtedly, the prior case (the original case) and the instant case arosefrom the same occurrence the construction work done by FinancialBuilding on the USSRs lot in Forbes Park Village. The issues of fact and lawin both cases are identical. The factual issue is whether the structureserected by Financial Building violate Forbes Parks rules and regulations,whereas the legal issue is whether Financial Building, as an independentcontractor working for the USSR, could be enjoined from continuing with theconstruction and be held liable for damages if it is found to have violatedForbes Parks rules.

As a result of the controversy, Financial Building seized the initiative by filingthe prior injunction case, which was anchored on the contention that Forbes

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Parks prohibition on the construction work in the subject premises wasimproper. The instant case on the other hand was initiated by Forbes Park tocompel Financial Building to remove the same structures it has erected inthe same premises involved in the prior case and to claim damages forundertaking the said construction. Thus, the logical relation between the twocases is patent and it is obvious that substantially the same evidence is

involved in the said cases.

Moreover, the two cases involve the same parties. The aggregate amount ofthe claims in the instant case is within the jurisdiction of the regional trialcourt, had it been set up as a counterclaim in the original case. Therefore,Forbes Parks claims in the instant case should have been filed as acounterclaim in the original case.

Second. Since Forbes Park filed a motion to dismiss in the original case, itsexisting compulsory counterclaim at that time is now barred.

A compulsory counterclaim is auxiliary to the proceeding in the original suitand derives its jurisdictional support therefrom. A counterclaim presupposes

the existence of a claim against the party filing the counterclaim. Hence,where there is no claim against the counterclaimant, the counterclaim isimproper and it must dismissed, more so where the complaint is dismissedat the instance of the counterclaimant. In other words, if the dismissal of themain action results in the dismissal of the counterclaim already filed, itstands to reason that the filing of a motion to dismiss the complaint is animplied waiver of the compulsory counterclaim because the grant of themotion ultimately results in the dismissal of the counterclaim.

Thus, the filing of a motion to dismiss and the setting up of a compulsorycounterclaim are incompatible remedies. In the event that a defending partyhas a ground for dismissal and a compulsory counterclaim at the same time,he must choose only one remedy. If he decides to file a motion to dismiss,he will lose his compulsory counterclaim. But if he opts to set up his

compulsory counterclaim, he may still plead his ground for dismissal as anaffirmative defense in his answer.The latter option is obviously morefavorable to the defendant although such fact was lost on Forbes Park.

The ground for dismissal invoked by Forbes Park in the original case waslack of cause of action. There was no need to plead such ground in a motionto dismiss or in the answer since the same was not deemed waived if it wasnot pleaded. Nonetheless, Forbes Park still filed a motion to dismiss andthus exercised bad judgment in its choice of remedies. Thus, it has no one toblame but itself for the consequent loss of its counterclaim as a result ofsuch choice.

WHEREFORE, the instant petition is hereby GRANTED and the Decision ofthe Court of Appeals is hereby REVERSED and SET ASIDE.

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Arenas vs. Court of Appeals G. R. No. 126640, November 23, 2000, 345SCRA 617 CHING

Doctrine: A counterclaim is compulsory where: (1) it arises out of, or isnecessary connected with, the transaction or occurrence that is the subjectmatter of the opposing partys claim; (2) it does not require the presence of

third parties of whom the court cannot acquire jurisdiction; and (3) the trialcourt has jurisdiction to entertain the claim.

Facts:

Case 1In 1970, Rosalina Rojas, who the owner of a 2-story building in Calasiao,Pangasinan, verbally leased the ground floor of the building to MarceloArenas, who used it as an optical clinic. The lease was on a month-to-monthbasis.

In 1990, wanting to demolish and reconstruct the building, Rojas terminatedthe lease and demanded Arenas to vacate. However, Arenas refused.

Rojas filed a case of unlawful detainer with the MTC. MTC ruled in favor ofRojas and ordered Arenas to vacate the place. The case was appealed tothe RTC wherein the RTC affirmed the decision of the MTC.

Case 2Arenas alleged that, after filing Case 1 and before the decision of the MTC inCase 1, Rojas has been harassing him to vacate the place, doing suchthings as (i) removing the signboard of the clinic (ii) cutting of his electricity(iii) dumping gravel and sand in front of their clinic. Due to this, Arenas fileda case for Damages with the RTC.

Rojas filed a motion to dismiss on the ground of forum shopping. However,the RTC denied her motion to dismiss. Eventually, the RTC ruled in favor of

Arenas and ordered Rojas to pay for damages.

The case was appealed to the CA. CA reversed the decision of the RTC anddismissed Arenas complaint. The CA reasoned that Arenas already filed acompulsory counterclaim in Case 1. Thus, he is barred from filing Case 2.

RTC: The RTC ruled in favor of Arenas and ordered Rojas to pay fordamages.

CA: CA reversed the decision of the RTC and dismissed Arenas complaint.

Issue:W/N the causes of action in Case 2 were in the nature of compulsory

counterclaims that must be pleaded in Case 1.

Held: No. The causes of action in Case 2 were not compulsorycounterclaims. That must be pleaded in Case 1.

Rule 11 of the Rules of Court defines a compulsory counterclaim as a claim

the defendant has at the time he files his answer. Thus, a counterclaim iscompulsory where: (1) it arises out of, or is necessary connected with, thetransaction or occurrence that is the subject matter of the opposing partysclaim; (2) it does not require the presence of third parties of whom the courtcannot acquire jurisdiction; and (3) the trial court has jurisdiction to entertainthe claim.

The following are the tests by which the compulsory nature of a counterclaimcan be determined: (1) Are the issues of fact and law raised by the claim andcounterclaim largely the same? (2) Would res judicatabar a subsequent suiton defendants claim absent the compulsory counterclaim rule? (3) Willsubstantially the same evidence support or refute plaintiffs claim as well asdefendants counterclaim? (4) Is there any logical relation between the claim

and counterclaim?

In this case, the cause of action in Case 1 is for unlawful detainer. In Case 2,the cause of actions were for damages due to (i) removing the signboard ofthe clinic (ii) cutting of his electricity (iii) dumping gravel and sand in front oftheir clinic, all of which happened after filing the Answer.

SC Ruling: SC set aside the decision of the CA and remanded the case tothe RTC.

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Korean Technologies v. Alberto Lerma, G.R. No. 143581, January 7,2008 DORIA

Doctrine:Payment of docket fees:effective August 16, 2004 under Sec. 7, Rule 141docket fees are now required to be paid in compulsory counterclaim or

cross-claims.Certificate of non-forum shopping: an Answer is a responsive pleading, notan initiatory pleading which requires a certification against forum shopping

Facts:Korea Technologies Co., Ltd. (KOGIES) is a Korean corporation

engaged in the supply and installation of Liquefied Petroleum Gas (LPG)Cylinder manufacturing plants. Private respondent Pacific General SteelManufacturing Corp. (PGSMC) is a domestic corporation.

On March 5, 1997, PGSMC and KOGIES executed a Contractwhereby KOGIES would set up an LPG Cylinder Manufacturing Plant inCarmona, Cavite, a property leased by PGSMC for PhP 322,560/month fromWorth Properties. The contract was executed in the Philippines.

On April 7, 1997, the parties executed, in Korea, an Amendment forthe prior contract amending the terms of payment. The contract and itsamendment stipulated that KOGIES will ship the machinery and facilitiesnecessary for manufacturing LPG cylinders, for which PGSMC would pay$1,224,000. KOGIES would install and initiate the operation of the plant, forwhich PGSMC would pay $306,000. The total contract price amounted to$1,530,000.

The machineries, equipment, and facilities for the manufacture ofLPG cylinders were shipped, delivered, and installed in the Carmona plant.PGSMC paid KOGIES $1,224,000. However, after the installation of theplant, the initial operation could not be conducted as PGSMC encounteredfinancial difficulties affecting the supply of materials, thus forcing the partiesto agree that KOGIES would be deemed to have completely complied withthe terms and conditions of the March 5, 1997 contract.

For the remaining balance of $306,000 for the installation and initialoperation of the plant, PGSMC issued two postdated checks. When KOGIESdeposited the checks, these were dishonored for the reason "PAYMENTSTOPPED." KOGIES sent a demand letter threatening criminal action forviolation of BP 22 in case of nonpayment.

Thereafter, the wife of PGSMCs President faxed a letter toKOGIES President complaining that not only did KOGIES deliver a differentbrand of hydraulic press from that agreed upon but it had not deliveredseveral equipment parts already paid for. PGSMC informed KOGIES thatPGSMC was canceling their Contract on the ground that KOGIES hadaltered the quantity and lowered the quality of the machineries andequipment it delivered to PGSMC, and that PGSMC would dismantle and

transfer the machineries, equipment, and facilities installed in the Carmonaplant.

KOGIES wrote PGSMC informing the latter that it could notunilaterally rescind their contract nor dismantle and transfer the machineriesand equipment on mere imagined violations by KOGIES. It also insisted thattheir disputes should be settled by arbitration as agreed upon in Article 15,

the arbitration clause of their contract.KOGIES filed a Complaint for Specific Performance against

PGSMC before the Muntinlupa City RTC. The RTC granted a TRO. In itscomplaint, KOGIES alleged that PGSMC had initially admitted that thechecks that were stopped were not funded but later on claimed otherwise.KOGIES averred that PGSMC violated Art. 15 of their Contract byunilaterally rescinding the contract without resorting to arbitration. KOGIESalso asked that PGSMC be restrained from dismantling and transferring themachinery and equipment installed in the plant.

PGSMC filed an opposition to the TRO arguing that KOGIES wasnot entitled to the TRO since Art. 15 of the arbitration clause, was null andvoid for being against public policy as it ousts the local courts of jurisdictionover the instant controversy. PGSMC filed its Answer with Compulsory

Counterclaim asserting that it had the full right to dismantle and transfer themachineries and equipment because it had paid for them in full; thatKOGIES was not entitled to PhP 9,000,000 for failing to completely installand make the plant operational; and that KOGIES was liable for damagesamounting to PhP 4,500,000 for altering the quantity and lowering the qualityof the machineries and equipment.

Trial courts decision/TC:The RTC denied the application for a writ of preliminary injunction,

reasoning that PGSMC had paid KOGIES the value of the machineries andequipment as shown in the contract such that KOGIES no longer hadproprietary rights over them. And that, Art. 15 of the Contract was invalid asit tended to oust the trial court or any other court jurisdiction over any disputethat may arise between the parties.

KOGIES filed its Reply to Answer and Answer to Counterclaim.KOGIES denied it had altered the quantity and lowered the quality of themachinery, equipment, and facilities it delivered. It averred that whateverwas unfinished was PGSMCs fault s ince it failed to procure raw materialsdue to lack of funds. KOGIES, relying on Chung Fu Industries (Phils.), Inc. v.Court of Appeals, insisted that the arbitration clause was without questionvalid.

Afterwhich, KOGIES filed a Supplemental Memorandum withMotion to Dismiss answering PGSMCs memorandum and counterclaims. Italso filed its Motion for Reconsideration of the order denying its applicationfor a writ of preliminary injunction.

The RTC issued an order denying KOGIES motion to dismiss

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PGSMCs compulsory counterclaims as these counterclaims fell within therequisites of compulsory counterclaims.

KOGIES filed an Urgent Motion for Reconsideration of the RTCOrder granting inspection of the plant and denying dismissal of PGSMCscompulsory counterclaims. Without waiting for the resolution of its urgentmotion for reconsideration, KOGIES filed before the CA a petition for

certiorari seeking annulment of the RTC Orders.

CAs decision/CA:The CA affirmed the RTC Orders and dismissed the petition for

certiorari filed by KOGIES. The CA found that the RTC did not gravely abuseits discretion.

On the issue of the validity of the arbitration clause, the CA agreedwith the lower court that an arbitration clause which provided for a finaldetermination of the legal rights of the parties to the contract by arbitrationwas against public policy.

On the issue of nonpayment of docket fees and non-attachment ofa certificate of non-forum shopping by PGSMC, the CA held that thecounterclaims of PGSMC were compulsory ones and payment of docket

fees was not required since the Answer with counterclaim was not aninitiatory pleading. For the same reason, the CA said a certificate of non-forum shopping was also not required.

Furthermore, the CA held that the petition for certiorari had beenfiled prematurely. According to the CA, the RTC must be given theopportunity to correct any alleged error it has committed, and that since theassailed orders were interlocutory, these cannot be the subject of a petitionfor certiorari.Hence, this Petition for Review on Certiorari under Rule 45.

Issue:W/N the payment of docket fees and submission of a certificate ofnon-forum shopping were necessary in the filing of PGSMCs compulsorycounterclaim?

Held:NO

SCs ruling:KOGIES strongly argues that when PGSMC filed the

counterclaims, it should have paid docket fees and filed a certificate of non-forum shopping, and that its failure to do so was a fatal defect.

We disagree with KOGIES.As aptly ruled by the CA, the counterclaims of PGSMC were

incorporated in its Answer with Compulsory Counterclaim dated July 17,1998 in accordance with Section 8 of Rule 11, 1997 Revised Rules of CivilProcedure, the rule that was effective at the time the Answer with

Counterclaim was filed. Sec. 8 on existing counterclaim or cross-claimstates, "A compulsory counterclaim or a cross-claim that a defending partyhas at the time he files his answer shall be contained therein."

On July 17, 1998, at the time PGSMC filed its Answer incorporatingits counterclaims against KOGIES, it was not liable to pay filing fees for saidcounterclaims being compulsory in nature. We stress, however, that

effective August 16, 2004 under Sec. 7, Rule 141, as amended by A.M. No.04-2-04-SC, docket fees are now required to be paid in compulsorycounterclaim or cross-claims.

As to the failure to submit a certificate of forum shopping, PGSMCsAnswer is not an initiatory pleading which requires a certification againstforum shopping under Sec. 5 of Rule 7, 1997 Revised Rules of CivilProcedure. It is a responsive pleading, hence, the courts a quo did notcommit reversible error in denying KOGIES motion to dismiss PGSMCscompulsory counterclaims.

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RULE 7 Parts of a Pleading

General Milling Corporation vs. NLRC G.R. No. 153199, December 17,2002 FRANCISCODoctrine:The rules of procedure are intended to promote, rather than frustrate, the

ends of justice, and while the swift unclogging of court dockets is a laudibleobjective, it, nevertheless, must not be met at the expense of substantialjustice.

This is a petition for review on certiorari of a decision of the CA.

Facts: This is to assail the resolution, dated 28 September 2001, of the

Court of Appeals dismissing the petition filed before it by hereinpetitioner (GMC) for not having been accompanied by a boardresolution and/or a certification by the corporate secretary thatwould show that the person who has signed the Certification ofNon-Forum Shopping is the person duly authorized by the

corporation to represent it in the case. Likewise challenged is theresolution of the appellate court denying petitioners motion forreconsideration.

The case originated from a complaint for illegal dismissal filed byprivate respondent Cacho against petitioner General MillingCorporation (GMC).

The Labor Arbiter found private respondent to have beenillegally dismissed by petitioner.

On appeal before it, the NLRC affirmed the findings of theLabor Arbiter.

GMC appealed to the CA but the petition was denied forthe failure of GMC to attach the board resolution to provethat the person who signed the Certification of Non-ForumShopping was duly authorized by the board of directors of

GMC. In its motion for reconsideration, GMC explained that the

signatory of the Certification of Non-Forum Shopping wasduly authorized to make it. The corresponding boardresolution to establish that fact was attached to its motionfor reconsideration before the appellate court. Its plea forreconsideration having been denied, the instant petition forreview was brought up to this Court.

LA: found Cacho to have been illegally dismissed by GMCNLRC: affirmed LAs findingsCA: dismissed the petition filed by the GMC

Issue: Whether or not GMC substantially complied with the proceduralrequirement.

Held:YES, GMC complied with procedural requirement but not that substantial.

When asked to comment, private respondent bewailed thebelated submission of the required certification. Privaterespondent cited the case of Melo vs. Court of Appeals to the effectthat x x x compliance with the certification requirement of non-forum shopping should not be made subject to a partysafterthought, lest the policy of the law be undermined.

The Court grants the petition. Unlike the case of Melo vs. Court of Appeals where there was a

complete failure to attach a Certification of Non-forum Shopping, inthis instance, however, GMC complied with this proceduralrequirement except that it was not accompanied by a boardresolution or a secretarys certificate that the person who signed itwas duly authorized by petitioner to represent it in the case. Itwould appear that the signatory of the certification was, in

fact,duly authorized as so evidenced by a board resolutionattached to petitioners motion for reconsideration before theappellate court. It could thus be said that there was at leastsubstantial compliance with, and that there was no attempt toignore, the prescribed procedural requirements.

The rules of procedure are intended to promote, rather thanfrustrate, the ends of justice, and while the swift unclogging of courtdockets is a laudable objective, it, nevertheless, must not be met atthe expense of substantial justice. Technical and procedural rulesare intended to help secure, not suppress, the cause of justice anda deviation from the rigid enforcement of the rules may be allowedto attain that prime objective for, after all, the dispensation of justiceis the core reason for the existence of courts.

SC: petition is GRANTED
http://sc.judiciary.gov.ph/jurisprudence/1999/nov99/123686.htmhttp://sc.judiciary.gov.ph/jurisprudence/1999/nov99/123686.htm

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Spouses Hontiveros vs. RTC of Iloilo, Branch 25 G.R. No. 125465, June29, 1999, 309 SCRA 340 GATCHALIAN

DOCTRINE:Under the rules, if there is no controverted matter in the caseafter the answer is filed, the trial court has the discretion to grant a motion forjudgment on the pleadings f iled by a party. When there are actual issues

raised in the answer, such as one involving damages, which require thepresentation of evidence and assessment thereof by the trial court, it isimproper for the judge to render judgment based on the pleadings alone.

FACTS:

In a land registration case, the court ruled in favor of the Petitioners statingthat the private respondents withheld possession of the land from petitionersin bad faith. Consequently, the petitioners-spouses filed a complaint fordamages against private respondents Gregorio Hontiveros and TeodoraAyson. Petitioners alleged that they are the owners of a parcel of land andwere deprived of income from the land as a result of the filing of the landregistration case. Private respondents denied the allegations, denied that

private respondents are married and prayed for dismissal of the complaint.

An Amended Complaint was filed by the petitioners insert therein anallegation that "earnest efforts towards a compromise have been madebetween the parties but the same were unsuccessful." In due time, privaterespondents filed an Answer to Amended Complaint with Counterclaim,which they denied the allegation. (NOTE: Gregorio and Augusto arebrothers and pursuant to Art 151 of the Family code, No suit betweenmembers of the same family shall prosper unless it should appear from theverified complaint or petition that earnest efforts toward a compromise havebeen made, but that the same have failed. It if is shown that no such effortswere in fact made, the case must be dismissed)

Petitioners moved for a judgment on the pleadings on the ground that private

respondents' answer did not tender an issue or that it otherwise admitted thematerial allegations of the complaint. Private respondents opposed themotion alleging that they had denied petitioners' claims and thus tenderedcertain issues of fact which could only be resolved after trial.

TC: Trial court denied petitioners' motion. At the same time, however, itdismissed the case on the ground that the complaint was not verified asrequired by Art. 151 of the Family Code and, therefore, it did not believe thatearnest efforts had been made to arrive at a compromise

Petitioners contend that the trial court erred in dismissing the complaintwhen no motion to that effect was made by any of the parties. They point out

that, in opposing the motion for judgment on the pleadings, privaterespondents did not seek the dismissal of the case but only the denial ofpetitioners' motion. Indeed, what private respondents asked was that trial beheld on the merits.

ISSUE:WON the court was correct in dismissing the case

HELD:NOThere are instances when the trial court may order the dismissal of the caseeven without a motion to that effect filed by any of the parties. . In Baja v.Macandog,

13this Court mentioned these cases, to wit:

The court cannot dismiss a case motu propriowithout violating theplaintiff's right to be heard, except in the following instances: if theplaintiff fails to appear at the time of the trial; if he fails to prosecutehis action for unreasonable length of time; or if he fails to complywith the rules or any order of the court; or if the court finds that ithas no jurisdiction over the subject matter of the suit.

However, none of these exceptions appears in this case.

Rule 19 of the Rules of Court provides:14

Sec. 1. Judgment on the pleadings. Where an answer fails totender an issue, or otherwise admits the material allegation of theadverse party's pleadings, the court may, on motion of the party,direct judgment on such pleading. But in actions for annulment ofmarriage or for legal separation the material facts alleged in thecomplaint shall always be proved.

Under the rules, if there is no controverted matter in the case after theanswer is filed, the trial court has the discretion to grant a motion forjudgment on the pleadings f iled by a party. When there are actual issuesraised in the answer, such as one involving damages, which require the

presentation of evidence and assessment thereof by the trial court, it isimproper for the judge to render judgment based on the pleadings alone. Inthis case, aside from the amount of damages, the following factual issueshave to be resolved, namely, (1) private respondent Teodora Ayson'sparticipation and/or liability, if any to petitioners and (2) the nature, extent,and duration of private respondents' possession of the subject property. Thetrial court, therefore, correctly denied petitioners' motion for judgment on thepleadings.

However, the trial court erred in dismissing petitioners' complaint on theground that, although it alleged that earnest efforts had been made towardthe settlement of the case but they proved futile, the complaint was not

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verified for which reason the trial court could not believe the veracity of theallegation.The absence of the verification required in Art. 151 does not affect thejurisdiction of the court over the subject matter of the complaint. Theverification is merely a formal requirement intended to secure an assurancethat matters which are alleged are true and correct. If the court doubted the

veracity of the allegations regarding efforts made to settle the case amongmembers of the same family, it could simply have ordered petitioners toverify them. As this Court has already ruled, the court may simply order thecorrection of unverified pleadings or act on it and waive strict compliancewith the rules in order that the ends of justice may be served.Otherwise,mere suspicion or doubt on the part of the trial court as to the truth of theallegation that earnest efforts had been made toward a compromise but theparties' efforts proved unsuccessful is not a ground for the dismissal of anaction. Only if it is later shown that such efforts had not really been exertedwould the court be justified in dismissing the action

Other issues:

WON the petitioners adopted the correct mode of appeal (Rule 45)YESWON Art 151 of the Family Code applies to this case although TeodoraAyson is not a family memberNO

SC:The petition is GRANTED and the Order, dated November 23, 1995 ofthe Regional Trial Court of Iloilo City, Branch 25 is SET ASIDE and the caseis remanded to the trial court for further proceedings not inconsistent withthis decision.

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Five Star Bus Co. vs. Court of Appeals G.R. No. 127064, August 31,1999, 313 SCRA 367 GAUDIEL

Doctrine:Certification of Non-Forum Shopping Should Be Signed by Plaintiff

NOT Counsel

Facts:One night in November 1991 at about 11pm, Ignacio Torres, while

driving a bus owned by Five Star Bus Company collided with a mini-vandriven by Samuel King Sagaral II. Sagaral filed a civil action for damagesagainst Five Star Bus Company and Torres.

The civil case dragged for four years by reason of the buscompanys lawyers repeated request to reset the hearing of the case. Untilthe trial court issued an order which considered the case submitted forresolution. The bus companys lawyer filed for a motion for reconsiderationbut it was denied.

The bus companys lawyer then filed a petition for certiorari beforethe Court of Appeals but the latter court summarily dismissed the petitionbecause said petitions affidavit of non-forum shopping was not signed bythe plaintiff or any of its representatives but rather it was signed by thelawyer.

The lawyer explained that his signing was an oversight and that hewas in a haste to submit the petition at the earliest possible time in order toprotect his clients interest.

Trial Court Ruling:

The trial court issuedits Order denying petitioners motion forreconsideration of its Order dated 16 July 1996 which considered the casesubmitted for resolution. The lower court noted that the case had beenpending for more than four (4) years and it had always been at the "mercy"of petitioners when it acted favorably on their motions. There would be no

end to this litigation if the court would give due course to this motion.

CAs decision/CA:

Petitioners moved for reconsideration which the Court of Appealsrejected in its Resolution. Petitioners are now before us contending that theappellate court erred in affirming the Order of the trial court and in dismissingtheir petition for non-compliance with the requirement of Circular No. 28-91.They pray that the appellate court remand the case to the court of origin forfurther proceedings.

Circular No. 28-91, which took effect on 1 April 1994, provides inter

alia

(1) (I)n every petition filed with the Supreme Court or the Court of Appeals,the petitioner, aside from complying with the pertinent provisions of theRules of Court and existing circulars, must certify under oath all of thefollowing facts or undertakings . . .;

(2) Any violation of this revised Circular will entail the following sanctions: (a)it shall be a cause for the summary dismissal of the multiple petitions orcomplaints; . . . (Emphasis supplied).

Circular No. 28-91 has its roots in the rule that a party-litigant shallnot be allowed to pursue simultaneous remedies in two (2) different fora, forsuch practice works havoc upon orderly judicial procedure. Forum shoppinghas been characterized as an act of malpractice that is prohibited andcondemned as trifling with the courts and abusing their processes. Itconstitutes improper conduct which tends to degrade the administration ofjustice. It has also been aptlUndeterred, petitioners sought recourse in theCourt of Appeals through a petition for certiorari. But in the assailedResolution dated 23 September 1996 the appellate court summarilydismissed their petition on the ground that the affidavit of non-forumshopping was signed and executed by counsel for petitioners and not bypetitioners themselves, or one of them, as required by Circular No. 28-91 ofthe Supreme Court.

Nonetheless, we are not unmindful of this Courts ruling inGabionza v. Court of Appeals, 18 Loyola v. Court of Appeals, 19 and Kavintav. Castillo, Jr. 20 that substantial compliance with Circular No. 28-91 issufficient:

It is scarcely necessary to add that Circular No. 28-91 must be sointerpreted and applied to achieve the purposes projected by the SupremeCourt when it promulgated that circular. Circular No. 28-91 was designed to

serve as an instrument to promote and facilitate the orderly administration ofjustice and should not be interpreted with such absolute literalness as tosubvert its own ultimate and legitimate objective or the goal of all rules ofprocedure which is to achieve substantial justice as expeditiously aspossible.

The fact that the Circular requires that it be strictly complied withmerely underscores its mandatory nature in that it cannot be dispensed withor its requirements altogether disregarded, but it does not thereby interdictsubstantial compliance with its provisions under justifiablecircumstances.chanrobles virtualawlibrarychanrobles.com:chanrobles.com.ph

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In the instant case, we cannot apply the "substantial compliance"rule to petitioners and be as liberal minded. For one thing, counsel forpetitioners gave a rather frail excuse for his non-compliance, i.e., oversightand haste in ensuring that the petition would be filed at the earliest possibletime for the protection of his clients interests thereby overlooking the

aforesaid circular.

Issue:

Whether the Court of Appeals can summarily dismiss a petition onthe ground that the certification on non-forum shopping required by SupremeCourt Circular No. 28-91 was signed by counsel and not by petitionersthemselves.

Held:No

SCs ruling:

Circular No. 28-91 issued by the Supreme Court requiring that theaffidavit of non-forum shopping should be executed and signed by theplaintiff is a strict requirement. Circular No. 28-91 has its roots in the rule thata party-litigant shall not be allowed to pursue simultaneous remedies in twodifferent tribunals, for such practice works havoc upon orderly judicialprocedure.

Forum shopping has been characterized as an act of malpracticethat is prohibited and condemned as trifling with the courts and abusing theirprocesses. It constitutes improper conduct which tends to degrade theadministration of justice. It has also been aptly described as deplorablebecause it adds to the congestion of the already heavily burdened dockets ofthe courts.

But the Supreme Court has relaxed this rule several times prior tothis case when there is substantial compliance, why is it not relaxed in thiscase?

It is true that said Circular requires that it be strictly complied with

but such merely underscores its mandatory nature in that it cannot bedispensed with or its requirements altogether disregarded, but it does notthereby interdict substantial compliance with its provisions under justifiablecircumstances.

In the case at bar however, the reasons provided by Five Stars

lawyer are flimsy and frail. Further, the case has been dragging on for yearsand such delay is mostly attributed to Five Stars lawyer.

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Digital Microwave Corporation vs. Court of Appeals G.R. No. 1399396,March 16, 2000, 328 SCRA 286 LESAVA

Doctrine: We have ruled that this Court will not interfere with theOmbudsmans exercise of his constitutionally mandated investigatory andprosecutory powers. Otherwise stated, it is beyond the ambit of this Court to

review the exercise of discretion of the Ombudsman in prosecuting ordismissing a complaint filed before it. Such initiative and independence areinherent in the Ombudsman who, beholden to no one, acts as the championof the people and preserver of the integrity of the public service.

Private Respondents: Dr. Jose Pepito H. Dalogdog, Dr. Aurora Beatriz A.Romano, Maria Teresita C. Abastar, Jessica S. Allan and Maria TeresaAniversario charged herein petitioners Efren O. Loquias, Antonio V. Din, Jr.,Angelito I. Martinez II, Lovelyn J. Biador and Gregorio Faciol, Jr.

- Respondents were officers of the Association of Municipal HealthOffice Personnel of Zamboanga del Sur who instituted the saidcomplaint in behalf of the 490 members of the said Association

Petitioners: Efren O. Loquias (Mayor), Antonio V. Din, Jr. (Vice Mayor),Angelito I. Martinez II, Lovelyn J. Biador (member of the Sangguniang Bayanof the said municipality) and Gregorio Faciol, Jr. (member of theSangguniang Bayan of the said municipality)

Synopsis:

Before this Court is a petition for certiorari under Rule 65 assailing theResolution charging herein petitioners for violation of Section 3, paragraph eof R.A. No. 3019 (Anti-Graft and Corrupt Practices Act) which was issued bythe Office of the Ombudsman for Mindanao and approved by Ombudsman

Aniano A. Desierto, and the Memorandum wherein Ombudsman Desiertodisapproved the recommendation of the Special Prosecutor dismissing theCriminal Case.

Facts:

Private respondents charged herein petitioners with violation of RA No. 3019for their alleged failure to give the salary increases and benefits provided inSection 20 of the Magna Carta of Public Health Workers (R.A. 7305) andLocal Budget Circulars Nos. 54, 54-A, 56, 60 and 64 for the health personnelof the local government of San Miguel, Zamboanga del Sur. The complaintwas filed in the Ombudsman-Mindanao.

Ombudsmans decision: Ombudsman Desierto found "probable cause toconclude that the crime of violation of Section 3 (e) of RA 3019 has beencommitted by respondents Mayor, Vice-Mayor, members of theSangguniang Bayan and Budget Officer of San Miguel, Zamboanga del Sur"and that accordingly, the appropriate Information be filed with the

Sandiganbayan.

Petitioners filed a Motion for Reinvestigation with prayer to defer arraignmentand pre-trial alleging that they recognize the salary increases of the healthpersonnel as a mandatory statutory obligation but the salary increases couldnot be implemented because of lack of funds and the municipality hadincurred overdrafts. They further argue that the failure to give salaryincreases and other Magna Carta benefits were due to circumstancesbeyond their control and not due to any manifest partiality, evident bad faithor gross inexcusable negligence on their part.

In a Memorandum, Special Prosecution Officer I Jacqueline J. Ongpauco-Cortel recommended the dismissal of the case which recommendation wasapproved by Deputy Special Prosecutor Kallos and concurred in by SpecialProsecutor Tamayo. Recommendation was disapproved by OmbudsmanDesierto stating in his handwriting that "(T)he crime had obviously beencommitted, per OMB Mindanao findings, long before the payment grantingthat the accused latters claim/allegation is true."

Meanwhile, petitioners filed a Motion for Reconsideration on the Resolutionof the Office of the Ombudsman-Mindanao alleging that there is no probablecause in holding that they violated Section 3 (e) of the Anti-Graft and CorruptPractices Act. Among other thingsl, petitioners also allege that the orderdisapproving the dismissal of the case constitutes a denial of their motion forreconsideration.

Alleging that the order disapproving the dismissal of the case constituted

denial of the motion for reconsideration, petitioners filed the present petitionassailing the Resolution and the Memorandum.

Issue: WON the Ombudsman committed grave abuse of discretionamounting to lack or in excess of jurisdiction for approving the resolutioncharging petitioners and for disapproving the memorandum thatrecommends the dismissal of the criminal case against petitioners?

Held: SC will not interfere with the Ombudsmans exercise of hisconstitutionally mandated investigatory and prosecutory powers. Otherwisestated, it is beyond the ambit of this Court to review the exercise ofdiscretion of the Ombudsman in prosecuting or dismissing a complaint filed

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before it. Such initiative and independence are inherent in the Ombudsmanwho, beholden to no one, acts as the champion of the people and preserverof the integrity of the public service.

As held in the Ocampo case:"x x x The rule is based not only upon respect for the

investigatory and prosecutory powers granted by the Constitutionto the Office of the Ombudsman but upon practicality as well.Otherwise, the functions of the courts will be grievouslyhampered by innumerable petitions assailing the dismissal ofinvestigatory proceedings conducted by the Office of theOmbudsman with regard to complaints filed before i t, in much thesame way that the courts would be extremely swamped if theycould be compelled to review the exercise of discretion on thepart of the fiscals or prosecuting attorneys each time they decideto file an information in court or dismiss a complaint by a privatecomplainant."

Addnl issue: With respect to the joint affidavits of waiver allegedly executedby private complainants for the purpose of requesting the Special Prosecutorto move for the dismissal of the criminal case.

This Court ruled in Alba vs. Nitorreda that a joint affidavit of desistance is notbinding on the Office of the Ombudsman and cannot prevail over theprovision of law which categorically allows the Office of the Ombudsman toinvestigate and prosecute on its own any act or omission of a public officeror employee, office or agency which appears to be illegal, unjust, improperor inefficient.

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Iglesia ni Kristo v. Ponferrada, G.R. No. 168943, October 27, 2006 LIM

FACTS:On October 24, 2001, Alicia, Alfredo, Roberto, Enrique and Susan, allsurnamed Santos, and Sonia Santos-Wallin, represented by Enrique G.Santos, filed a complaint for Quieting of Title and/or Accion Reinvindicatoria

before the Regional Trial Court (RTC) of Quezon City against the Iglesia NiCristo(INC), defendant therein.

Plaintiffs alleged therein that, during his lifetime, Enrique Santos was theowner of a 936-square-meter parcel of land located in Tandang Sora,Quezon City.

He had been in possession of the owners duplicate of said title and hadbeen in continuous, open, adverse and peaceful possession of the property.He died on February 9, 1970 and was survived by his wife, Alicia Santos,and other plaintiffs, who were their children. Thereafter, plaintiffs tookpeaceful and adverse possession of the property, and of the ownersduplicate of said title.

When the Office of the Register of Deeds of Quezon City was burned onJune 11, 1988, the original copy of said title was burned as well. TheRegister of Deeds had the title reconstituted based on the owners duplicate.

Sometime in February 1996, plaintiffs learned that defendant was claimingownership over the property based on a TCT issued on September 18, 1984under the name of the Philippine National Bank, which allegedly cancelledTCT No. 252070 in the names of the spouses Marcos and Romana delaCruz. They insisted that TCT Nos. 321744, 320898 and 252070 were notamong the titles issued by the Register of Deeds of Quezon City and even ifthe Register of Deeds issued said titles, it was contrary to law. EnriqueSantos, during his lifetime, and his heirs, after his death, never encumberedor disposed the property. In 1996, plaintiffs had the property fenced but

defendant deprived them of the final use and enjoyment of their property.

As gleaned from the caption of the complaint, plaintiffs appear to be theheirs of Enrique Santos, represented by Enrique G. Santos. The lattersigned the Verification and Certificate of Non-Forum Shopping alone. (i.e.only his name and signature appeared on the verification and certificate.)

Defendant moved to dismiss plaintiffs complaint on the following grounds:(1) plaintiffs failed to faithfully comply with the procedural requirements setforth in Section 5, Rule 7 of the 1997 Rules of Civil Procedure; (2) the action(either Quieting of Title orAccion Reinvindicatoria) had prescribed, the samehaving been filed only on October 24, 2001 beyond the statutory ten-year

period therefor; and (3) that the complaint is defective in many respects.

Defendant asserted that the case involved more than one plaintiff but theverification and certification against forum shopping incorporated in thecomplaint was signed only by Enrique Santos. Although the complaintalleges that plaintiffs are represented by Enrique Santos, there is no

showing that he was, indeed, authorized to so represent the other plaintiffsto file the complaint and to sign the verification and certification of non-forumshopping. Thus, plaintiffs failed to comply with Section 5, Rule 7 of the Rulesof Court. Defendant cited the ruling of this Court in Loquias v. Office of theOmbudsman.

Defendant maintained that the complaint is defective in that, although thereis an allegation that Enrique Santos represents the other heirs, there isnothing in the pleading to show the latters authority to that effect; thecomplaint fails to aver with particularity the facts showing the capacity ofdefendant corporation to sue and be sued; and the pleading does not statethe address of plaintiffs.

In their Comment on the motion, plaintiffs averred that the relationship of aco-owner to the other co-owners is fiduciary in character; thus, anyone ofthem could effectively act for another for the benefit of the property withoutneed for an authorization. Consequently, Enrique Santos had the authority torepresent the other heirs as plaintiffs and to sign the verification andcertification against forum shopping.

In its reply, defendant averred that absent any authority from his co-heirs,Enrique Santos must implead them as plaintiffs as they are indispensableparties. In response, plaintiffs aver that a co-owner of a property can executean action for quieting of title without impleading the other co-owners.

The trial court issued an Orderdenying defendants motion to dismiss. It

declared that since Enrique Santos was one of the heirs, his signature in the

verification and certification constitutes substantial compliance with theRules. The court cited the ruling of this Court in Dar v. Alonzo-Legasto. Thecourt, likewise, held that prescription had not set in and that failure to statethe address of plaintiffs in the complaint does not warrant the dismissal ofthe complaint.

Defendant filed a motion for reconsideration, which the court likewise deniedin an Order dated July 10, 2002. Unsatisfied, defendant, as petitioner, filed aPetition for Certiorari and Prohibition with Prayer for the Issuance of aTemporary Restraining Order and/or Preliminary Injunction before the CA.

The CA affirmed the RTC decision.

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ISSUE: W/N a verification issued by only one of the plaintiffs is sufficientenough to render the same valid

HELD: DENIED.

The purpose of verification is simply to secure an assurance that theallegations of the petition (or complaint) have been made in good faith; orare true and correct, not merely speculative. This requirement is simply acondition affecting the form of pleadings, and noncompliance therewith doesnot necessarily render it fatally defective. Indeed, verification is only aformal, not a jurisdictional requirement.

This Court held inAteneo de Naga University v. Manalo, that the verificationrequirement is deemed substantially complied with when, as in the presentcase, only one of the heirs-plaintiffs, who has sufficient knowledge and beliefto swear to the truth of the allegations in the petition (complaint), signed theverification attached to it. Such verification is deemed sufficient assurancethat the matters alleged in the petition have been made in good faith or aretrue and correct, not merely speculative.

The same liberality should likewise be applied to the certification againstforum shopping. The general rule is that the certification must be signed byall plaintiffs in a case and the signature of only one of them is insufficient.However, the Court has also stressed in a number of cases that the rules onforum shopping were designed to promote and facilitate the orderlyadministration of justice and thus should not be interpreted with suchabsolute literalness as to subvert its own ultimate and legitimate objective.The rule of substantial compliance may be availed of with respect to thecontents of the certification. This is because the requirement of strictcompliance with the provisions merely underscores its mandatory nature inthat the certification cannot be altogether dispensed with or its requirementscompletely disregarded.

It is noteworthy that the Court applied the rule on substantial compliancebecause of the commonality of interest of all the parties with respect to thesubject of the controversy in many past similar cases.

The CA did not err in affirming the application of the rule on substantialcompliance. In the instant case, the property involved is a 936-square-meterreal property. Both parties have their respective TCTs over the property.Respondents herein who are plaintiffs in the case below have a commoninterest over the property being the heirs of the late Enrique Santos, thealleged registered owner of the subject property as shown in one of theTCTs. As such heirs, they are considered co-owners pro indiviso of the

whole property since no specific portion yet has been adjudicated to any ofthe heirs. Consequently, as one of the heirs and principal party, the lonesignature of Enrique G. Santos in the verification and certification is sufficientfor the RTC to take cognizance of the case. The commonality of theirinterest gave Enrique G. Santos the authority to inform the RTC on behalf ofthe other plaintiffs therein that they have not commenced any action or claim

involving the same issues in another court or tribunal, and that there is noother pending action or claim in another court or tribunal involving the sameissues. Hence, the RTC correctly denied the motion to dismiss filed bypetitioner.Considering that at stake in the present case is the ownership andpossession over a prime property in Quezon City, the apparent merit of thesubstantive aspects of the case should be deemed as a specialcircumstance or compelling reason to allow the relaxation of the rule.

Time and again, this Court has held that rules of procedure are establishedto secure substantial justice. Being instruments for the speedy and efficientadministration of justice, they may be used to achieve such end, not to derailit. In particular, when a strict and literal application of the rules on non-forumshopping and verification will result in a patent denial of substantial justice,these may be liberally construed.28 The ends of justice are better servedwhen cases are determined on the merits after all parties are given fullopportunity to ventilate their causes and defenses rather than ontechnicality or some procedural imperfections.

Indeed, this Court strictly applied the rules on verification andcertification against forum shopping in cases where the commonality ofinterest between or among the parties is wanting.

Anent the issue of the authority of Enrique G. Santos to representhis co-heirs/co-plaintiffs, we find no necessity to show such authority.Respondents herein are co-owners of the subject property. As such co-owners, each of the heirs may properly bring an action for ejectment, forcibleentry and detainer, or any kind of action for the recovery of possession of thesubject properties. Thus, a co-owner may bring such an action, even without

joining all the other co-owners as co-plaintiffs, because the suit is deemed tobe instituted for the benefit of all.

We uphold the validity of the complaint because of the followingcircumstances: (1) the caption of the instant case is Heirs of Enrique Santosv. Iglesia ni Cristo; (2) the opening statement of the complaint states thatplaintiffs are the heirs of Enrique Santos and likewise names the particularheirs of the latter who instituted the complaint below; (3) the case involves aproperty owned by the predecessor-in-interest of plaintiffs therein; and (4)the verification signed by Enrique G. Santos clearly states that he is one ofthe children of the late Enrique Santos and that he represents the heirs ofsaid Enrique Santos.
http://www.lawphil.net/judjuris/juri2006/oct2006/gr_168943_2006.html#fnt28http://www.lawphil.net/judjuris/juri2006/oct2006/gr_168943_2006.html#fnt28http://www.lawphil.net/judjuris/juri2006/oct2006/gr_168943_2006.html#fnt28http://www.lawphil.net/judjuris/juri2006/oct2006/gr_168943_2006.html#fnt28

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Vallacar Transit, Inc. v. Jocelyn Catubig, G.R. No. 175512, May 30, 2011MAGSUMBOLDOCTRINE: A pleading lacking proper verification is to be treated as anunsigned pleading which produces no legal effect

FACTS: Petitioner is engaged in the business of transportation and the

franchise owner of a Ceres Bulilit bus. Quirino C. Cabanilla (Cabanilla) isemployed as a regular bus driver of petitioner.

On January 27, 1994, respondents husband, Quintin Catubig, Jr. (Catubig),was on his way home from Dumaguete City riding in tandem on amotorcycle with his employee, Teddy Emperado (Emperado). Catubig wasthe one driving the motorcycle. While approaching a curve at kilometers 59and 60, Catubig tried to overtake a slow moving ten-wheeler cargo truck bycrossing-over to the opposite lane, which was then being traversed by theCeres Bulilit bus driven by Cabanilla, headed for the opposite direction.When the two vehicles collided, Catubig and Emperado were thrown fromthe motorcycle. Catubig died on the spot where he was thrown, whileEmperado died while being rushed to the hospital.

Cabanilla was charged with reckless imprudence resulting in doublehomicide before the MCTC of Manjuyod-Bindoy-Ayungon of the Province ofNegros Oriental. After preliminary investigation, the MCTC issued aResolution dismissing the criminal charge against Cabanilla. It found thatCabanilla was not criminally liable for the deaths of Catubig and Emperado,because there was no negligence, not even contributory, on Cabanillas part.

Thereafter, respondent filed before the RTC a Complaint for Damagesagainst petitioner, seeking actual, moral, and exemplary damages, in thetotal amount of P484,000.00, for the death of her husband, Catubig, basedon Article 2180, in relation to Article 2176, of the Civil Code. Respondentalleged that petitioner is civilly liable because the latters employee driver,Cabanilla, was reckless and negligent in driving the bus which collided with

Catubigs motorcycle.Petitioner, in its Answer with Counterclaim, contended that the proximatecause of the vehicular collision, which resulted in the deaths of Catubig andEmperado, was the sole negligence of Catubig when he imprudentlyovertook another vehicle at a curve and traversed the opposite lane of theroad. As a special and affirmative defense, petitioner asked for thedismissal of respondents complaint for not being verified and/or for failure tostate a cause of action, as there was no allegation that petitioner wasnegligent in the selection or supervision of its employee driver.

In the Pre-Trial Order, the parties stipulated that the primary issue for trialwas whether or not petitioner should be held liable for Catubigs death. Trialthen ensued.

PO2 Robert B. Elnas (Elnas), Emilio Espiritu (Espiritu), Dr. NorbertoBaldado, Jr. (Dr. Baldado), Peter Cadimas (Cadimas), and respondent

herself testified in support of respondents complaint.

PO2 Elnas conducted an investigation of the collision incident. According toPO2 Elnas, the bus was running fast, at a speed of 100 kilometers per hour,when it collided with the motorcycle which was trying to overtake a truck.The collision occurred on the lane of the bus. Catubig was flung 21 metersaway, and Emperado, 11 meters away, from the point of impact. Themotorcycle was totaled; the chassis broke into three parts, and the frontwheel and the steering wheel with the shock absorbers were found 26meters and 38 meters, respectively, from the collision point. In contrast, onlythe front bumper of the bus suffered damage.

Cadimas personally witnessed the collision of the bus and the motorcycle.He recalled that he was then waiting for a ride to Dumaguete City and sawthe Ceres Bulilit bus making a turn at a curve. Cadimas signaled the saidbus to halt but it was running fast. Cadimas also recollected that there wasa cargo truck running slow in the opposite direction of the bus. Cadimasnext heard a thud and saw that the bus already collided with a motorcycle.

Espiritu was the photographer who took photographs of the scene of theaccident. He identified the five photographs which he had taken of Catubiglying on the ground, bloodied; broken parts of the motorcycle; and the truckwhich Catubig tried to overtake.

Dr. Baldado was the medico-legal doctor who conducted the post-mortemexamination of Catubigs body. He reported that Catubig suffered from thefollowing injuries: laceration and fracture of the right leg; laceration and

fracture of the left elbow; multiple abrasions in the abdominal area, leftanterior chest wall, posterior right arm, and at the back of the left scapulararea; and contusion-hematoma just above the neck. Dr. Baldado confirmedthat Catubig was already dead when the latter was brought to the hospital,and that the vehicular accident could have caused Catubigs instantaneousdeath.

Respondent herself testified to substantiate the amount of damages she wastrying to recover from petitioner for Catubigs death, such as Catubigsearning capacity; expenses incurred for the wake and burial of Catubig, aswell as of Emperado; the cost of the motorcycle; and the costs of the legalservices and fees respondent had incurred.

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Respondents documentary exhibits consisted of her and Catubigs MarriageContract dated August 21, 1982, their two childrens Certificate of LiveBirths, Catubigs College Diploma dated March 24, 1983, the list andreceipts of the expenses for Catubigs burial, the sketch of the collision siteprepared by PO2 Elnas, the excerpts from the police blotter, the

photographs of the collision, and the Post Mortem Report on Catubigscadaver prepared by Dr. Baldado.

RTC admitted all of respondents aforementioned evidence.

On the other hand, Rosie C. Amahit and Nunally Maypa took the witnessstand for petitioner.

Amahit was a Court Stenographer at the MCTC who took the transcript ofstenographic notes (TSN) in the Criminal Case against Cabanilla. Amahitverified that the document being presented by the defense in the presentcase was a true and correct copy of the TSN of the preliminary investigationheld in the Criminal Case, and another document was a duplicate original ofthe MCTC Resolution dated December 22, 1994 dismissing the CriminalCase.

Maypa is the Administrative and Personnel Manager at the Dumaguetebranch of petitioner. He started working for petitioner as a clerk at theHuman Resources Development Department at the Central Office ofpetitioner in Bacolod City. He became an Administrative Assistant at theDumaguete branch of petitioner; and then, was promoted to his currentposition at the same branch.

While he was still an Administrative Assistant, Maypa was responsible forthe hiring of personnel including drivers and conductors. Maypa explainedthat to be hired as a driver, an applicant should be 35 to 45 years old, haveat least five years experience in driving big trucks, submit police, court, and

medical clearances, and possess all the necessary requirements for drivinga motor vehicle of more than 4,500 kilograms in gross weight such as aprofessional drivers license with a restriction code of 3. The applicantshould also pass the initial interview, the actual driving and maintenanceskills tests, and a written psychological examination involving defensivedriving techniques. Upon passing these examinations, the applicant still hadto go through a 15-day familiarization of the bus and road conditions beforebeing deployed for work. Maypa, however, admitted that at the time of hisappointment as Administrative Assistant at the Dumaguete branch,Cabanilla was already an employee driver of petitioner.

Maypa further explained the investigation and grievance procedure followedby petitioner in cases of vehicular accidents involving the latters employeedrivers. Maypa related that Cabanilla had been put on preventivesuspension following the vehicular accident involving the bus Cabanilla wasdriving and the motorcycle carrying Catubig and Emperado. Following aninternal investigation of said accident conducted by petitioner, Cabanilla was

declared not guilty of causing the same, for he had not been negligent.

Lastly, Maypa recounted the expenses petitioner incurred as a result of thepresent litigation.

The documentary exhibits of petitioner consisted of the TSN of thepreliminary investigation in Criminal Case No. M-15-94 held on May 25,1994 before the MCTC of Manjuyod-Bindoy-Ayungon of the Province ofNegros Oriental; Resolution dated December 22, 1994 of the MCTC in thesame case; and the Minutes dated February 17, 1994 of the GrievanceProceeding conducted by petitioner involving Cabanilla.

The RTC, in its Order,admitted all the evidence presented by petitioner.

TC DECISION: RTC promulgated its Decision favoring petitioner. Based onthe sketch prepared by PO2 Elnas, which showed that the point of impact xx x occurred beyond the center lane near a curve within the lane of theCeres bus; plus, the testimonies of PO2 Elnas and Cadimas that themotorcycle recklessly tried to overtake a truck near a curve and encroachedthe opposite lane of the road, the RTC ruled that the proximate cause of thecollision of the bus and motorcycle was the negligence of the driver of themotorcycle, Catubig. The RTC, moreover, was convinced through thetestimony of Maypa, the Administrative and Personnel Manager of theDumaguete branch of petitioner, that petitioner had exercised due diligencein the selection and supervision of its employee drivers, including Cabanilla.

Counterclaim is also dismissed

CA DECISION: The Court of Appeals denied the motion for reconsiderationof petitioner.

ISSUE: W/N a pleading lacking proper verification is treated as an unsignedpleading, which produces no legal effect under Section 3, Rule 7 of theRules of Court?

HELD: Petition is granted.

SC RULING: At the outset, we find no procedural defect that would havewarranted the outright dismissal of respondents complaint.

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Respondent filed her complaint for damages against petitioner on July 19,1995, when the 1964 Rules of Court was still in effect. Rule 7, Section 6 ofthe 1964 Rules of Court provided:

SEC. 6. Verification.A pleading is verified only by an affidavitstating that the person verifying has read the pleading and that the

allegations thereof are true of his own knowledge.

Verifications based on "information and belief," or upon"knowledge, information and belief," shall be deemed insufficient.

On July 1, 1997, the new rules on civil procedure took effect. The foregoingprovision was carried on, with a few amendments, as Rule 7, Section 4 ofthe 1997 Rules of Court, viz:

SEC. 4. Verification. Except when otherwise specifically requiredby law or rule, pleadings need not be under oath, verified oraccompanied by affidavit.

A pleading is verified by an affidavit that the affiant has read thepleading and that the allegations therein are true and correct of hisknowledge and belief.

A pleading required to be verified which contains a verificationbased on information and belief, or upon knowledge, informationand belief, or lacks a proper verification, shall be treated as anunsigned pleading.

The same provision was again amended by A.M. No. 00-2-10, whichbecame effective on May 1, 2000. It now reads:

SEC. 4. Verification. - Except when otherwise specifically requiredby law or rule, pleadings need not be under oath, verified or

accompanied by affidavit.

A pleading is verified by an affidavit that the affiant has read thepleading and that the allegations therein are true and correct of hispersonal knowledge or based on authentic records.

A pleading required to be verified which contains a verificationbased on information and belief or upon knowledge, informationand belief, or lacks a proper verification, shall be treated as anunsigned pleading.

The 1997 Rules of Court, even prior to its amendment by A.M. No. 00-2-10,clearly provides that a pleading lacking proper verification is to be treated asan unsigned pleading which produces no legal effect. However, it also justas clearly states that except when otherwise specifically required by law orrule, pleadings need not be under oath, verified or accompanied by affidavit.No such law or rule specifically requires that respondents complaint for

damages should have been verified.

Although parties would often submit a joint verification and certificate againstforum shopping, the two are different.

In Pajuyo v. Court of Appeals, we already pointed out that:

A partys failure to sign the certification against forum shopping isdifferent from the partys failure to sign personally the verification.The certificate of non-forum shopping must be signed by the party,and not by counsel. The certification of counsel renders the petitiondefective.

On the other hand, the requirement on verification of a pleading is aformal and not a jurisdictional requisite. It is intended simply tosecure an assurance that what are alleged in the pleading are trueand correct and not the product of the imagination or a matter ofspeculation, and that the pleading is filed in good faith. The partyneed not sign the verification. A partys representative, lawyer orany person who personally knows the truth of the facts alleged inthe pleading may sign the verification.

In the case before us, we stress that as a general rule, a pleadingneed not be verified, unless there is a law or rule specifically requiring thesame.

In contrast, all complaints, petitions, applications, and otherinitiatory pleadings must be accompanied by a certificate against forum

shopping, first prescribed by Administrative Circular No. 04-94, which tookeffect on April 1, 1994, then later on by Rule 7, Section 5 of the 1997 Rulesof Court. It is not disputed herein that respondents complaint for damageswas accompanied by such a certificate.

In addition, verification, like in most cases required by the rules ofprocedure, is a formal, not jurisdictional, requirement, and mainly intended tosecure an assurance that matters which are alleged are done in good faithor are true and correct and not of mere speculation. When circumstanceswarrant, the court may simply order the correction of unverified pleadings oract on it and waive strict compliance with the rules in order that the ends ofjustice may thereby be served.

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RULE 8 Manner of Making Allegations in the Pleading

Kalilid Wood Industries Corporation vs. IAC G.R. No. 75502, November12, 1987, 155 SCRA 594 MORA

Doctrine:

Facts:Joaquin Miguel de Jesus and Alfredo T. Salonga, President-GeneralManager and Comptroller, respectively, of P.B. De Jesus and Company,Inc., executed a promissory note (PBC No. 1202-76) in favor of respondentPhilippine Banking Corporation in the amount of P600,000.00, the obligationmaturing on 29 December 1976. Similarly, a second promissory note (PBCNo. 1255-76) was executed this time in the amount of P300,000.00, payableon or before 3 January 1977. These two instruments were executed todocument or reflect loans secured from respondent Bank and were signedby Messrs. de Jesus and Salonga.

P.D. De Jesus and Company, Inc., by vote of its stockholders, changed itscorporate name to Kalilid Wood Industries Corporation (hereafter "Kalilid"),an act subsequently validated by the Securities and Exchange Commission.Thereafter, respondent Bank served several letters of demand uponpetitioner Kalilid for payment by the latter of the obligations contracted underpromissory notes PBC No. 1202-76 and PBC No. 1255-76 which hadapparently remained unsettled. Petitioner Kalilid, however, disowned itsalleged indebtedness under both promissory notes.

The Bank filed a Complaint for collection against Kalilid, and Messrs. deJesus and Salonga in the Court of First Instance of Rizal. In its complaint,respondent Bank alleged that petitioner Kalilid, as principal, should be heldsolidarily liable under promissory notes PBC No. 1202-76 and PBC No.125576 together with Messrs. de Jesus and Salonga, both of whom had

signed said promissory notes for and in behalf of the petitioners company,as well as in their own personal capacities. Respondent Bank further allegedthat, as of 30 April 1981, the total amount of the indebtedness of the obligorsunder the two promissory notes had risen to Pl,780,253.08 i.e., PI18649696 with respect to promissory note PBC No. 120276, andP593,756.12 with respect to promissory note PBC No. 125176 The Banksubmitted in substantiation of these claimed amounts two separateStatements of Account (one for each promissory note), which had beenprepared by respondent Bank and attached to the complaint as Annexes "C"and "D" thereof. Promissory notes PBC No. 1202-76 and IBC No. 1255-76were likewise attached to the complaint as its Annexes "A" and "B",respectively.

In its Answer, petitioner Kalilid alleged that it "ha[d] no knowledge orinformation sufficient to form a belief as to the truth of [the materialallegations in the complaint]. As its affirmative defense, petitioner Kalilidasserted that the authority to borrow money or contract loans on its behalfhad not been granted to Messrs. de Jesus and Salonga who, it was further

asserted, should be held solely liable under the two promissory notes. Theanswer of petitioner Kalilid, however, was not verified.

CFIs decision:The complaint was dismissed without prejudice, with respect to de Jesusand Salonga whose whereabouts can not then be ascertained.

The trial courts decision:The parties were unable to arrive at an amicable settlement during pre-trial.Thus, a motion for summary judgment was filed by the respondent Bank towhich Kalilid raised neither objection nor opposition.

The trial court found Kalilid liable to the Bank for the obligations contractedunder the promissory notes.

The trial Judge based his decision primarily on two factors: (1) the failure ofpetitioner Kalilid to verify its answer, which failure the trial Judge consideredas amounting to an admission by petitioner Kalilid of the genuineness anddue execution of promissory notes PBC No. 1202-76 and PBC No. 1255-76,which were annexed to respondent Bank's complaint; and (2) the fact thatthe two disputed promissory notes were signed by Messrs. de Jesus andSalonga both for and in behalf of the former P.B. de Jesus and Company,Inc. (now petitioner Kalilid) and in their own personal capacities.

IACs decision:The judgment of the lower court was affirmed in toto.

The statements of account Annexes A and B are also attached to the samecomplaint as integral part thereof. Annex A pertains to the promissory noteNo. 1202-76 with the principal of P600,000.00 while Annex B pertains to thepromissory note No. 125576 with the principal of P300,000.00. Explained insaid statements of account are the charges for past due interest and penaltycharges and the total of said obligation as of April 30, 1981 showed a total ofprincipal, interest and penalty charges of P1,780,253.08. The genuinenessand due execution of said promissory notes and statements of account aredeemed admitted by the failure to deny under oath said documents. ...

Issue:

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In the present Petition for Review, petitioner Kalilid no longer denies itsliabilities and obligations under the two promissory notes executed infavor of respondent Bank. It would, however, contest the correctness of theaggregate amount of its indebtedness, as claimed by respondent Bank. Inthis respect, petitioner Kalilid contends that although it may haveimpliedly admitted the genuineness and due execution of promissory

notesPBC No. 1202-76 and PBC No. 125576Annexes "A" and "B" of theComplaintas a result of its failure to deny specifically and under oaththe material allegations in respondent Bank's complaint, suchadmission cannot be made to extend and apply to the twoaforementioned Statements of AccountAnnexes "C" and "D" of theComplaint-since none of petitioner Kalilid's duly authorizedrepresentatives had participated in the preparation thereof.Furthermore, in the computations appearing therein, amountscorresponding to service charges, penalty charges, and interestcharges on past due interest were included which, petitioner Kalilidclaims, are not part of i ts undertakings under either promissory note.

Held:

The SC agree with the ruling of the trial Judge and the respondent appellatecourt that petitioner Kalilid, due to its failure to verify its answer, is deemed tohave admitted by implication the authenticity and due execution ofpromissory notes PBC No. 1202-76 and PBC No. 1255-76, which were bothannexed to and made the basis for respondent Bank's complaint.Consequently, defenses relating to the genuineness and due execution ofthe notes, such as that the instruments are spurious counterfeit, or ofdifferent import on their faces from the ones executed by the parties; or thatthe signatures appearing therein are forgeries; or that said signatures wereunauthorized as in the case of an agent signing for his principal or onesigning in behalf of a partnership or corporation; or that the corporation wasnot authorized under its charter to sign the instruments; or that the partycharged signed the instruments in some capacity other than that set out in

the instruments; or that the instruments were never delivered, are effectivelycut off, placing petitioner Kalilid in estoppel from disclaiming liability underthose promissory notes. No genuine issue having been raised in the trialcourt by petitioner Kalilid regarding the existenceand validityof its liabilitiesunder promissory notes PBC No. 1202-76 and PBC No. 1255-76, summaryjudgment was properly and appropriately rendered in the case at bar.

In respect, however, of the amount of petitioner Kalilid's total indebtednessto respondent Bank under the two promissory notes, it was error for theappellate court (as for the trial Judge) to have expanded the scope ofpetitioner Kalilid's implied admission of genuineness and due execution so

as to include the two Statements of Account annexed to the complaint. Onthis point, Rule 8, Section 8 of the Revised Rules of Court is quite specific.

Section 8. How to contest genuineness of such documents.Whenan action or defense is founded upon a written instrument, copied in orattached to the corresponding pleading as provided in the preceding section,

the genuineness and due execution of the instrument shall be deemedadmitted unless the adverse party, under oath, specifically denies them, andsets forth what he claims to be the facts; but this provision does not applywhen the adverse party does not appear to be a party to the instrument orwhen compliance with an order for an inspection of the original instrument isrefused. (Emphasis supplied.)

An examination of the two disputed Statements of Account reveals that bothdocuments (1) were printed under the official letterhead of respondent Bank,(2) were prepared by the Loans and Discounting Department of respondentBank, and (3) bore the signature of approval of respondent Bank'sauthorized officer. No other signature appears on the face of eitherdocument. In other words, both Statements of Account were preparedexclusivelyby respondent Bank. It follows that petitioner Kalilid, not havingbeen privy thereto, did not admit the genuineness and due execution of theStatements in spite of its failure to verify its answer to the complaint, and thatpetitioner is not conclusively bound by the charges nor by the computationsof amounts set out therein

SCs ruling:The decisions of the IAC are AFFIRMED as to the extent that they refer tothe principal amounts and stipulated interest due under PBS 1202-76 andPBC 1255-76. However, the case is REMANDED to the trial court for thedetermination of whether or not service charges and penalty charges in caseof late payment are due from petitioner (Kalilid Wood) to respondent(Philippine Banking Corp), and if so, the amount thereof, as well as for thedetermination of the amount of interest on past due interest, due and

payable by petitioner to respondent Bank.

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Permanent Savings Bank v. Velarde, G.R. No. 140608, September 23,2004 PABALAN

Doctrine: When the cause of action is anchored on a document, the

genuineness or due execution of the instrument shall be deemed

impliedly admitted unless the defendant, under oath, specificallydenies them, and sets forth what he claims to be the facts. In a specific denial, the defendant must declare under oath that he

did not sign the document or that it is otherwise false or fabricated. The admission of the genuineness and due execution of a

document effectively eliminates any defense relating to theauthenticity and due execution of the document.

Facts: Petitioner Bank filed action to recover 1M plus interest & penalties

from respondent Mariano Velarde for failure of respondent to payloan indicated in a promissory note dated September 28,1983.

Alleged facts of the loan are as follows: Oct 13, 1983Promisorry Note was due and demandable Jul 27, 1988 Petitioner banks counsel made a written

demand Aug 5, 1988Respondent received demand letter Feb 22, 1994Petitioner sent another demand letter 1995Filing of the case

Respondent disclaims any liability on the instrument, the receipt ofthe said amount of P1-Million shows that the amount was receivedby another person, not the herein defendant. Hence, no liabilityattaches and as further stated in the special and affirmativedefenses that, assuming the promissory note exists, it does notbind much less is there the intention by the parties to bind theherein defendant. In other words, the documents relative to the loando not express the true intention of the parties.

On September 6, 1995, petitioner bank presented its sole witness,Antonio Marquez, who identified the Promissory Note datedSeptember 28, 1983.

The respondent, instead of presenting evidence, filed with leave ofcourt his demurrer to evidence, alleging the grounds that:(a) PLAINTIFF FAILED TO PROVE ITS CASE BY

PREPONDERANCE OFEVIDENCE.

(b) THE CAUSE OF ACTION, CONCLUDING ARGUENTITHAT IT EXISTS, IS BARRED BY PRESCRIPTION AND/ORLACHES.14

TC:Ruled in favor of respondent. Found merit in demurrer to evidence anddismissed the complaint including respondents counterclaims, withoutpronouncement as to costs.

CA:Affirmed the TC and the dismissal of the complaint. The appellate courtfound that petitioner failed to present any evidence to prove the existence of

respondents alleged loan obligations, considering that respondent deniedpetitioners allegations in its complaint. It also found that petitioner bankscause of action is al ready barred by prescription.

Issue:1. WON demurrer to evidence was correctly sustainedNO2. WON cause of action is barred by prescriptionNO

Held:1. NO. The petitioner bank need not present further evidence to

prove the genuineness or authenticity of Promissory note because therespondent did not specifically deny the facts alleged regarding the loandocuments. In fact, he impliedly admitted the same. Because of this impliedadmission, the respondent can no longer use any defense relating to theauthenticity and due execution of the document; and therefore, the demurrerto evidence filed should have been dismissed.

The pertinent rule on actionable documents is found in Rule 8, Section 7 ofthe Rules of Court which provides that when the cause of action is anchoredon a document, the genuineness or due execution of the instrument shall bedeemed impliedly admitted unless the defendant, under oath, specificallydenies them, and sets forth what he claims to be the facts.

Respondents denials do not constitute an effective specific denial ascontemplated by law. In the early case of Songco vs. Sellner, the Courtexpounded on how to deny the genuineness and due execution of anactionable document, viz.:

This means that the defendant must declare under oath that he did notsign thedocument or that it is otherwise false or fabricated. Neither does thestatement of the answer to the effect that the instrument was procured byfraudulent representation raise any issue as to its genuineness or dueexecution. On the contrary such a plea is an admission both of thegenuineness and due execution thereof, since it seeks to avoid theinstrument upon a ground not affecting either.

In fact, respondents allegations amount to an implied admission of the dueexecution and genuineness of the promissory note. The admission of thegenuineness and due execution of a document means that the party whose

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signature it bears admits that he voluntarily signed the document or it wassigned by another for him and with his authority -- that at the time it wassigned it was in words and figures exactly as set out in the pleading of theparty relying upon it; that the document was delivered; and that anyformalities required by law, such as a seal, an acknowledgment, or revenuestamp, which it lacks, are waived by him. Also, it effectively eliminated any

defense relating to the authenticity and due execution of the document.

Clearly, both the trial court and the Court of Appeals erred in concluding thatrespondent specifically denied petitioners allegations regarding the loandocuments.

2. NO. The Court also finds that petitionersclaim is not barred byprescription. Petitioners action for collection of a sum of money was basedon a written contract and prescribes after ten years from the time its right ofaction arose. The prescriptive period is interrupted when there is a writtenextrajudicial demand by the creditors. The interruption of the prescriptiveperiod by written extrajudicial demand means that the said period wouldcommence anew from the receipt of the demand.

Respondents obligation under the promissory note became due anddemandable on October 13, 1983. On July 27, 1988, petitioners counselmade a written demand for petitioner to settle his obligation. From the timerespondents obligation became due and demandable on October 13, 1983,up to the time the demand was made, only 4 years, 9 months and 14 dayshad elapsed. The prescriptive period then commenced anew whenrespondent received the demand letter on August 5, 1988. Thus, whenpetitioner sent another demand letter on February 22, 1994, the action stillhad not yet prescribed as only 5 years, 6 months and 17 days had lapsed

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RULE 9 Effect of Failure to Plead

Sps. Juan J. Diaz and Elizabeth Diaz vs. Jose Diaz and Court ofAppeals G.R. No. 135885, April 28, 2000, 331 SCRA 302 PEREZ

FACTS

Action for a sum of money was filed before the Regional Trial Courtof by private respondent Jose Diaz against petitioners Juan and ElizabethDiaz. The complaint stemmed from a property bought in Greenhills byElizabeth Diaz. It was bought with money of a previous sale of lot both co-owned by Jose and Elizabeth. The Greenhills property was effectively andpartly held in trust by Elizabeth for Jose.

Jose demands P2 million for his part of the lot taking into accountthe current value of the lot.

On September 19, 1997, private respondent filed an action for sumof money with the Regional Trial Court of Mandaluyong City.

On October 7, 1997, petitioners filed a Motion to Dismiss8 on the groundthat private respondents Complaint failed to state a cause of action, andassuming that private respondent had a cause of action against them, it wasalready barred by prescription and laches. Private respondent filed hisOpposition to the Motion to Dismiss, to which petitioners responded by filinga Reply.

TC: In its Order dated November 27, 1997, the trial court deniedpetitioners Motion to Dismiss as the points invoked and the argumentsadvanced were contentious and evidentiary in nature which could not beestablished by mere allegations in the pleadings but must be proved duringthe trial on the merits. The trial court denied the Motion for Reconsiderationof petitioners in its Order dated January 14, 1998.

CA: Court of Appeals affirming the denial of petitioners Motion to Dismiss isAFFIRMED

ISSUE

Documents

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