ANGELITO P. MAGNO, Petitioner, vs.

PEOPLE OF THE PHILIPPINES, MICHAEL MONSOD, ESTHER LUZ MAE GREGORIO, GIAN CARLO CAJOLES, NENETTE CASTILLON, DONATO ENABE and ALFIE FERNANDEZ, Respondents. DECISION BRION, J.: Through a petition for review on certiorari,1 petitioner Angelito P. Magno seeks the reversal of the Amended Decision of the Court of Appeals (CA), dated September 26, 20052 in "People of the Philippines, et al. v. Hon. Augustine A. Vestil, Presiding Judge, RTC Mandaue City, Br. 56, et al." (docketed as CAG.R. SP No. 79809), and its Resolution dated February 6, 20063 denying respondents motion for reconsideration.4 The assailed rulings denied the petition for certiorari filed under Rule 65 of the Rules of Court and upheld the ruling 5 of the Regional Trial Court (RTC) of Mandaue City, which precluded Atty. Adelino B. Sitoy from acting as private prosecutor in Criminal Case No. DU-10123.6 THE FACTUAL ANTECEDENTS On May 14, 2003, the Office of the Ombudsman filed an information for multiple frustrated murder and double attempted murder against several accused, including Magno, who were public officers working under the National Bureau of Investigation.7 During the scheduled arraignment, Magno, in open court, objected to the formal appearance and authority of Atty. Sitoy, who was there as private prosecutor to prosecute the case for and on behalf of the Office of the Ombudsman. 8 The oral objection was reduced to writing on July 21, 2003 when Magno filed an opposition 9 before Branch 56 of the RTC of Mandaue City, citing the provisions of Section 31 of Republic Act ( RA) No. 6770.10 The Office of the Ombudsman submitted its comment,11 while the accused submitted their joint opposition.12 The respondents likewise submitted their comments to the opposition of the other co-accused.13 On September 25, 2003, the RTC issued an Order, ruling that "the Ombudsman is proper, legal and authorized entity to prosecute this case to the exclusion of any other entity/person other than those authorized under R.A. 6770."14

In open court, the Office of the Ombudsman moved for the reconsideration of the Order, which the RTC later denied in its October 1, 2003 Order.15 Proceedings before the CA On October 13, 2003, the respondents, through the Ombudsman for the Visayas and Atty. Sitoy, filed a petition for certiorari before the CA.16 They contended that the RTC committed a grave abuse of discretion in prohibiting the appearance of Atty. Sitoy as counsel for the private offended parties, as the Rules of Court expressly provides that a private offended party may intervene, by counsel, in the prosecution of offenses.17 Magno, in his comment18 filed on December 15, 2003, insisted that what he questioned before the RTC was the appearance and authority of the private prosecutor to prosecute the case in behalf of the Ombudsman. 19 He stressed that while the Office of the Ombudsman can designate prosecutors to assist in the prosecution of criminal cases, its authority in appointing, deputizing or authorizing prosecutors to prosecute cases is confined only to fiscals, state prosecutors and government lawyers. It does not extend to private practitioners/private prosecutors.20 He further stressed that while the Order of the RTC states that the Office of the Ombudsman is the proper legal and authorized entity to prosecute the case, it did not affect the right to intervene personally, as the Office of the Ombudsman can take the cudgels for the private respondents in prosecuting the civil aspect of the case.21 On February 16, 2005, the CA, in its original Decision, declared that the private prosecutor may appear for the petitioner in the case, but only insofar as the prosecution of the civil aspect of the case is concerned.22 The respondents moved for the reconsideration23 of the CA decision. On September 26, 2005, the CA amended its decision,24 ruling that the private prosecutor may appear for the petitioner in Criminal Case No. DU-10123 to intervene in the prosecution of the offense charged in collaboration with any lawyer deputized by the Ombudsman to prosecute the case.25 Failing to obtain a reconsideration 26 of the amended CA decision, Magno elevated the dispute to this Court through the present petition for review on certiorari27 filed under Rule 45 of the Rules of Procedure.

PETITIONERS ARGUMENTS Magno submits that the CA did not have jurisdiction to entertain the petition for certiorari; the power to hear and decide that question is with the Sandiganbayan. 28 To support this contention, Magno invokes Engr. Teodoto B. Abbot v. Hon. Judge Hilario I. Mapayo, etc., et al.29 where the Court held that the Sandiganbayan has the exclusive power to issue petitions for certiorari in aid of its appellate jurisdiction.30 Even if the Court were to set aside this procedural lapse, Magno adds, the private prosecutor cannot be allowed to intervene for the respondents as it would violate Section 31 of RA No. 6770.31 Section 31 limits the Ombudsmans prerogative to designate prosecutors to fiscals, state prosecutors and government lawyers. It does not, Magno maintains, allow the Ombudsman to deputize private practitioners to prosecute cases for and on behalf of the Office of the Ombudsman. 32 RESPONDENTS ARGUMENTS The Office of the Ombudsman, through the Office of the Special Prosecutor, submitted its memorandum on February 8, 2008. Substantively, the Ombudsman maintains that Atty. Sitoy may intervene in the case pursuant to Section 16, Rule 110 of the Rules of Court, which reads: Sec. 16. Intervention of the offended party in criminal action. Where the civil action for recovery of civil liability is instituted in the criminal action pursuant to Rule 111, the offended party may intervene by counsel in the prosecution of the offense. The Ombudsman maintains that Section 31 of RA No. 6770 did not amend Section 16, Rule 110 of the Rules of Court.33 Section 31 merely allows the Ombudsman to designate and deputize any fiscal, state prosecutor or lawyer in the government service to act as special investigator or prosecutor to assist in the investigation and prosecution in certain cases.34 The Ombudsman opines that the two provisions of law "are not diametrically opposed nor in conflict,"35 as "a private prosecutor may appear for the private offended complainants in the prosecution of an offense independent of the exclusive right of the Ombudsman to deputize."36 The Ombudsman, however, did not address the contention that the Sandiganbayan, not the CA, has appellate jurisdiction over the RTC in this case.

THE COURTS RULING We resolve to grant the petition. The Sandiganbayan, not the CA, has appellate jurisdiction over the RTCs decision not to allow Atty. Sitoy to prosecute the case on behalf of the Ombudsman Presidential Decree (PD) No. 1606 created the Sandiganbayan. Section 4 thereof establishes the Sandiganbayans jurisdiction: Section 4. Jurisdiction. The Sandiganbayan shall exercise exclusive original jurisdiction in all cases involving: A. Violations of Republic Act No. 3019, as amended, otherwise known as the Anti-Graft and Corruption Practices Act, Republic Act No. 1379, and Chapter II, Section 2, Title VII, of the Revised Penal Code, where one or more of the accused are officials occupying the following positions in the government, whether in a permanent, acting or interim capacity, at the time of the commission of the offense: xxxx B. Other offenses or felonies whether simple or complexed with other crimes committed by the public officials and employees mentioned in subsection of this section in relation to their office. C. Civil and criminal cases filed pursuant to and in connection with Executive Order Nos. 1, 2, 14 and 14-A, issued in 1986. In cases where none of the accused are occupying positions corresponding to Salary Grade "27" or higher, as prescribed in the said Republic Act No. 6758, or military or PNP officers mentioned above, exclusive original jurisdiction thereof shall be vested in the proper regional trial court, metropolitan trial court, municipal trial court, and municipal circuit trial court, as the case may be, pursuant to their respective jurisdictions as provided in Batas Pambansa Blg. 129, as amended. The Sandiganbayan shall exercise exclusive appellate jurisdiction over final judgments, resolutions or orders of regional trial courts whether in the exercise of their own original jurisdiction or of their appellate jurisdiction as herein provided. The Sandiganbayan shall have exclusive original jurisdiction over petitions for the

issuance of the writs of mandamus, prohibition, certiorari, habeas corpus, injunctions, and other ancillary writs and processes in aid of its appellate jurisdiction and over petitions of similar nature, including quo warranto, arising or that may arise in cases filed or which may be filed under Executive Order Nos. 1, 2, 14 and 14-A, issued in 1986: Provided, That the jurisdiction over these petitions shall not be exclusive of the Supreme Court. The procedure prescribed in Batas Pambansa Blg. 129, as well as the implementing rules that the Supreme Court has promulgated and may hereafter promulgate, relative to appeals/petitions for review to the Court of Appeals, shall apply to appeals and petitions for review filed with the Sandiganbayan. In all cases elevated to the Sandiganbayan and from the Sandiganbayan to the Supreme Court, the Office of the Ombudsman, through its special prosecutor, shall represent the People of the Philippines, except in cases filed pursuant to Executive Order Nos. 1, 2, 14 and 14-A, issued in 1986. In case private individuals are charged as coprincipals, accomplices or accessories with the public officers or employees, including those employed in government-owned or controlled corporations, they shall be tried jointly with said public officers and employees in the proper courts which shall exercise exclusive jurisdiction over them. Any provision of law or Rules of Court to the contrary notwithstanding, the criminal action and the corresponding civil action for the recovery of civil liability shall at all times be simultaneously instituted with, and jointly determined in, the same proceeding by the Sandiganbayan or to appropriate courts, the filing of the criminal action being deemed to necessarily carry with it the filing of civil action, and no right to reserve the filing of such civil action separately from the criminal action shall be recognized: Provided, however, That where the civil action had theretofore been filed separately but judgment therein has not yet been rendered, and the criminal case is hereafter filed with the Sandiganbayan or the appropriate court, said civil action shall be transferred to the Sandiganbayan or the appropriate court, as the case may be, for consolidation and joint determination with the criminal action, otherwise the separate civil action shall be deemed abandoned." [emphasis and underscoring supplied] This is clear: the Sandiganbayan has exclusive appellate jurisdiction over resolutions issued by

RTCs in the exercise of their own original jurisdiction or of their appellate jurisdiction. We reaffirmed this rule in Abbot.37 In that case, petitioner Engr. Abbot filed a petition for certiorari before the CA, claiming that the RTC gravely abused its discretion for not dismissing the information for Malversation thru Falsification of Public Document. The CA refused to take cognizance of the case, holding that the Sandiganbayan has jurisdiction over the petition. Recognizing the amendments made to PD No. 1606 by RA No. 7975, 38 we sustained the CAs position since Section 4 of PD No. 1606 has expanded the Sandiganbayans jurisdiction to include petitions for "mandamus, prohibition, certiorari, habeas corpus, injunction, and other ancillary writs and processes in aid of its appellate jurisdiction."39 In the present case, the CA erred when it took cognizance of the petition for certiorari filed by Magno. While it is true that the interlocutory order issued by the RTC is reviewable by certiorari, the same was incorrectly filed with the CA. Magno should have filed the petition for certiorari with the Sandiganbayan, which has exclusive appellate jurisdiction over the RTC since the accused are public officials charged of committing crimes in their capacity as Investigators of the National Bureau of Investigation.40 The CA should have dismissed the petition outright. Since it acted without authority, we overrule the September 26, 2005 Amended Decision of the CA and the subsequent denial of Magnos motions for reconsideration. Jurisdiction is conferred by law, and the CAs judgment, issued without jurisdiction, is void. There is no rule in procedural law as basic as the precept that jurisdiction is conferred by law,41 and any judgment, order or resolution issued without it is void42 and cannot be given any effect.43 This rule applies even if the issue on jurisdiction was raised for the first time on appeal or even after final judgment.44 We reiterated and clarified the rule further in Felicitas M. Machado, et al. v. Ricardo L. Gatdula, et al.,45 as follows: Jurisdiction over a subject matter is conferred by law and not by the parties action or conduct. Estoppel generally does not confer jurisdiction over a cause of action to a tribunal where none, by law, exists. In Lozon v. NLRC, we declared that:

Lack of jurisdiction over the subject matter of the suit is yet another matter.1avvphil Whenever it appears that the court has no jurisdiction over the subject matter, the action shall be dismissed. This defense may be interposed at any time, during appeal or even after final judgment. Such is understandable, as this kind of jurisdiction is conferred by law and not within the courts, let alone the parties, to themselves determine or conveniently set aside. We note that Magno had already raised in his supplemental motion for reconsideration before the CA46 the ground of lack of jurisdiction before the CAs Decision became final. The CA did not even consider this submission, choosing instead to brush it aside for its alleged failure to raise new or substantial grounds for reconsideration.47 Clearly, however, its lack of jurisdiction is a new and substantial argument that the CA should have passed upon. The Office of the Ombudsman cannot rely on the principle of estoppel to cure the jurisdictional defect of its petition before the CA The Ombudsman cannot rely on the principle of estoppel in this case since Magno raised the issue of jurisdiction before the CAs decision became final. Further, even if the issue had been raised only on appeal to this Court, the CAs lack of jurisdiction could still not be cured. In Machado,48 citing People of the Philippines v. Rosalina Casiano,49 we held: In People v. Casiano, this Court, on the issue of estoppel, held: The operation of the principle of estoppel on the question of jurisdiction seemingly depends upon whether the lower court actually had jurisdiction or not. If it had no jurisdiction, but the case was tried and decided upon the theory that it had jurisdiction, the parties are not barred, on appeal, from assailing such jurisdiction, for the same "must exist as a matter of law, and may not be conferred by consent of the parties or by estoppel." However if the lower court had jurisdiction, and the case was heard and decided upon a given theory, such, for instance, as that the court had no jurisdiction, the party who induced it to adopt such theory will not be permitted, on appeal, to assume an inconsistent position that the lower court had jurisdiction. WHEREFORE, we DENY the petitioners petition for review on certiorari, and DECLARE the Amended Decision of the Court of Appeals in CA-G.R. SP No. 79809, promulgated on September 26, 2005, as well as its Resolution of

February 6, 2006, NULL AND VOID for having been issued without jurisdiction. The respondents are hereby given fifteen (15) days from the finality of this Decision within which to seek recourse from the Sandiganbayan. No costs. SO ORDERED.

G.R. No. 141181

April 27, 2007

SAMSON CHING, Petitioner, vs. CLARITA NICDAO and HON. COURT OF APPEALS, Respondents. DECISION CALLEJO, SR., J.: Before the Court is a petition for review on certiorari filed by Samson Ching of the Decision1 dated November 22, 1999 of the Court of Appeals (CA) in CA-G.R. CR No. 23055. The assailed decision acquitted respondent Clarita Nicdao of eleven (11) counts of violation of Batas Pambansa Bilang (BP) 22, otherwise known as "The Bouncing Checks Law." The instant petition pertains and is limited to the civil aspect of the case as it submits that notwithstanding respondent Nicdaos acquittal, she should be held liable to pay petitioner Ching the amounts of the dishonored checks in the aggregate sum of P20,950,000.00. Factual and Procedural Antecedents On October 21, 1997, petitioner Ching, a Chinese national, instituted criminal complaints for eleven (11) counts of violation of BP 22 against respondent Nicdao. Consequently, eleven (11) Informations were filed with the First Municipal Circuit Trial Court (MCTC) of Dinalupihan-Hermosa, Province of Bataan, which, except as to the amounts and check numbers, uniformly read as follows: The undersigned accuses Clarita S. Nicdao of a VIOLATION OF BATAS PAMBANSA BILANG 22, committed as follows: That on or about October 06, 1997, at Dinalupihan, Bataan, Philippines, and within the jurisdiction of this Honorable Court, the said accused did then and there willfully and unlawfully make or draw and issue Hermosa Savings & Loan Bank, Inc. Check No. [002524] dated October 06, 1997 in the amount of [P20,000,000.00] in payment of her obligation with complainant Samson T.Y. Ching, the said accused knowing fully well that at the time she issued the said check she did not have sufficient funds in or credit with the drawee bank for the payment in full of the said check upon presentment, which check when presented for payment within ninety (90) days from the date thereof, was dishonored by the drawee bank for the reason that it was drawn against insufficient funds and notwithstanding receipt of notice of such dishonor the said

accused failed and refused and still fails and refuses to pay the value of the said check in the amount of [P20,000,000.00] or to make arrangement with the drawee bank for the payment in full of the same within five (5) banking days after receiving the said notice, to the damage and prejudice of the said Samson T.Y. Ching in the aforementioned amount of [P20,000,000.00], Philippine Currency. CONTRARY TO LAW. Dinalupihan, Bataan, October 21, 1997. (Sgd.) SAMSON T.Y. CHING Complainant The cases were docketed as Criminal Cases Nos. 9433 up to 9443 involving the following details: Reaso Private n for Dat Complai the e nant Disho nor DAIF*

Check Amount No.

Oct Samson 00252 P 20,000 . 6, T.Y. 42 ,000 19 Ching 97 00885 150,000 63 Oct . 6, " 19 97 Oct . 6, " 19 97 Oct . 6, " 19 97 Oct . 6, " 19 97 Oct . 6, " 19 97 Oct . 6, " 19 97

"

01214 100,000 24

"

00453 50,000 15

"

00225 100,000 46

"

00887 100,000 57

"

00893 50,000 68

"

00227 50,000 39

Oct . 6, " 19 97 Oct . 6, " 19 97 Oct . 6, " 19 97 Oct . 6, " 19 97

"

00894 150,000 810

"

approached him to borrow money in order for them to settle their financial obligations. They agreed that respondent Nicdao would leave the checks undated and that she would pay the loans within one year. However, when petitioner Ching went to see her after the lapse of one year to ask for payment, respondent Nicdao allegedly said that she had no cash. Petitioner Ching claimed that he went back to respondent Nicdao several times more but every time, she would tell him that she had no money. Then in September 1997, respondent Nicdao allegedly got mad at him for being insistent and challenged him about seeing each other in court. Because of respondent Nicdao's alleged refusal to pay her obligations, on October 6, 1997, petitioner Ching deposited the checks that she issued to him. As he earlier stated, the checks were dishonored by the bank for being "DAIF." Shortly thereafter, petitioner Ching, together with Emma Nuguid, wrote a demand letter to respondent Nicdao which, however, went unheeded. Accordingly, they separately filed the criminal complaints against the latter. On cross-examination,14 petitioner Ching claimed that he had been a salesman of the La Suerte Cigar and Cigarette Manufacturing for almost ten (10) years already. As such, he delivered the goods and had a warehouse. He received salary and commissions. He could not, however, state his exact gross income. According to him, it increased every year because of his business. He asserted that aside from being a salesman, he was also in the business of extending loans to other people at an interest, which varied depending on the person he was dealing with. Petitioner Ching confirmed the truthfulness of the allegations contained in the eleven (11) Informations that he filed against respondent Nicdao. He reiterated that, upon their agreement, the checks were all signed by respondent Nicdao but she left them undated. Petitioner Ching admitted that he was the one who wrote the date, October 6, 1997, on those checks when respondent Nicdao refused to pay him. With respect to the P20,000,000.00 check (Check No. 002524), petitioner Ching explained that he wrote the date and amount thereon when, upon his estimation, the money that he regularly lent to respondent Nicdao beginning October 1995 reached the said sum. He likewise intimated that prior to 1995, they had another transaction amounting to P1,200,000.00 and, as security therefor, respondent Nicdao similarly issued in his favor checks in varying amounts

00893 100,000 511

"

01037 100,000 712

"

At about the same time, fourteen (14) other criminal complaints, also for violation of BP 22, were filed against respondent Nicdao by Emma Nuguid, said to be the common law spouse of petitioner Ching. Allegedly fourteen (14) checks, amounting to P1,150,000.00, were issued by respondent Nicdao to Nuguid but were dishonored for lack of sufficient funds. The Informations were filed with the same MCTC and docketed as Criminal Cases Nos. 9458 up to 9471. At her arraignment, respondent Nicdao entered the plea of "not guilty" to all the charges. A joint trial was then conducted for Criminal Cases Nos. 9433-9443 and 9458-9471. For the prosecution in Criminal Cases Nos. 9433-9443, petitioner Ching and Imelda Yandoc, an employee of the Hermosa Savings & Loan Bank, Inc., were presented to prove the charges against respondent Nicdao. On directexamination,13 petitioner Ching preliminarily identified each of the eleven (11) Hermosa Savings & Loan Bank (HSLB) checks that were allegedly issued to him by respondent Nicdao amounting to P20,950,000.00. He identified the signatures appearing on the checks as those of respondent Nicdao. He recognized her signatures because respondent Nicdao allegedly signed the checks in his presence. When petitioner Ching presented these checks for payment, they were dishonored by the bank, HSLB, for being "DAIF" or "drawn against insufficient funds." Petitioner Ching averred that the checks were issued to him by respondent Nicdao as security for the loans that she obtained from him. Their transaction began sometime in October 1995 when respondent Nicdao, proprietor/manager of Vignette Superstore, together with her husband,

of P100,000.00 and P50,000.00. When the said amount was fully paid, petitioner Ching returned the checks to respondent Nicdao. Petitioner Ching maintained that the eleven (11) checks subject of Criminal Cases Nos. 94339443 pertained to respondent Nicdaos loan transactions with him beginning October 1995. He also mentioned an instance when respondent Nicdaos husband and daughter approached him at a casino to borrow money from him. He lent themP300,000.00. According to petitioner Ching, since this amount was also unpaid, he included it in the other amounts that respondent Nicdao owed to him which totaled P20,000,000.00 and wrote the said amount on one of respondent Nicdaos blank checks that she delivered to him. Petitioner Ching explained that from October 1995 up to 1997, he regularly delivered money to respondent Nicdao, in the amount of P1,000,000.00 until the total amount reached P20,000,000.00. He did not ask respondent Nicdao to acknowledge receiving these amounts. Petitioner Ching claimed that he was confident that he would be paid by respondent Nicdao because he had in his possession her blank checks. On the other hand, the latter allegedly had no cause to fear that he would fill up the checks with just any amount because they had trust and confidence in each other. When asked to produce the piece of paper on which he allegedly wrote the amounts that he lent to respondent Nicdao, petitioner Ching could not present it; he reasoned that it was not with him at that time. It was also averred by petitioner Ching that respondent Nicdao confided to him that she told her daughter Janette, who was married to a foreigner, that her debt to him was only between P3,000,000.00 and P5,000,000.00. Petitioner Ching claimed that he offered to accompany respondent Nicdao to her daughter in order that they could apprise her of the amount that she owed him. Respondent Nicdao refused for fear that it would cause disharmony in the family. She assured petitioner Ching, however, that he would be paid by her daughter. Petitioner Ching reiterated that after the lapse of one (1) year from the time respondent Nicdao issued the checks to him, he went to her several times to collect payment. In all these instances, she said that she had no cash. Finally, in September 1997, respondent Nicdao allegedly went to his house and told him that Janette was only willing to pay him between P3,000,000.00 and P5,000,000.00 because, as far as her daughter was concerned,

that was the only amount borrowed from petitioner Ching. On hearing this, petitioner Ching angrily told respondent Nicdao that she should not have allowed her debt to reach P20,000,000.00 knowing that she would not be able to pay the full amount. Petitioner Ching identified the demand letter that he and Nuguid sent to respondent Nicdao. He explained that he no longer informed her about depositing her checks on his account because she already made that statement about seeing him in court. Again, he admitted writing the date, October 6, 1997, on all these checks. Another witness presented by the prosecution was Imelda Yandoc, an employee of HSLB. On direct-examination,15 she testified that she worked as a checking account bookkeeper/teller of the bank. As such, she received the checks that were drawn against the bank and verified if they were funded. On October 6, 1997, she received several checks issued by respondent Nicdao. She knew respondent Nicdao because the latter maintained a savings and checking account with them. Yandoc identified the checks subject of Criminal Cases Nos. 94339443 and affirmed that stamped at the back of each was the annotation "DAIF". Further, per the banks records, as of October 8, 1997, only a balance of P300.00 was left in respondent Nicdaos checking account andP645.83 in her savings account. On even date, her account with the bank was considered inactive. On cross-examination,16 Yandoc stated anew that respondent Nicdaos checks bounced on October 7, 1997 for being "DAIF" and her account was closed the following day, on October 8, 1997. She informed the trial court that there were actually twenty-five (25) checks of respondent Nicdao that were dishonored at about the same time. The eleven (11) checks were purportedly issued in favor of petitioner Ching while the other fourteen (14) were purportedly issued in favor of Nuguid. Yandoc explained that respondent Nicdao or her employee would usually call the bank to inquire if there was an incoming check to be funded. For its part, the defense proffered the testimonies of respondent Nicdao, Melanie Tolentino and Jocelyn Nicdao. On directexamination,17 respondent Nicdao stated that she only dealt with Nuguid. She vehemently denied the allegation that she had borrowed money from both petitioner Ching and Nuguid in the total amount ofP22,950,000.00. Respondent Nicdao admitted, however, that she had obtained a loan from Nuguid but only forP2,100,000.00 and the same was already

fully paid. As proof of such payment, she presented a Planters Bank demand draft dated August 13, 1996 in the amount of P1,200,000.00. The annotation at the back of the said demand draft showed that it was endorsed and negotiated to the account of petitioner Ching. In addition, respondent Nicdao also presented and identified several cigarette wrappers18 at the back of which appeared computations. She explained that Nuguid went to the grocery store everyday to collect interest payments. The principal loan was P2,100,000.00 with 12% interest per day. Nuguid allegedly wrote the payments for the daily interests at the back of the cigarette wrappers that she gave to respondent Nicdao. The principal loan amount of P2,100,000.00 was allegedly delivered by Nuguid to respondent Nicdao in varying amounts of P100,000.00 and P150,000.00. Respondent Nicdao refuted the averment of petitioner Ching that prior to 1995, they had another transaction. With respect to the P20,000,000.00 check, respondent Nicdao admitted that the signature thereon was hers but denied that she issued the same to petitioner Ching. Anent the other ten (10) checks, she likewise admitted that the signatures thereon were hers while the amounts and payee thereon were written by either Jocelyn Nicdao or Melanie Tolentino, who were employees of Vignette Superstore and authorized by her to do so. Respondent Nicdao clarified that, except for the P20,000,000.00 check, the other ten (10) checks were handed to Nuguid on different occasions. Nuguid came to the grocery store everyday to collect the interest payments. Respondent Nicdao said that she purposely left the checks undated because she would still have to notify Nuguid if she already had the money to fund the checks. Respondent Nicdao denied ever confiding to petitioner Ching that she was afraid that her daughter would get mad if she found out about the amount that she owed him. What allegedly transpired was that when she already had the money to pay them (presumably referring to petitioner Ching and Nuguid), she went to them to retrieve her checks. However, petitioner Ching and Nuguid refused to return the checks claiming that she (respondent Nicdao) still owed them money. She demanded that they show her the checks in order that she would know the exact amount of her debt, but they refused. It

was at this point that she got angry and dared them to go to court. After the said incident, respondent Nicdao was surprised to be notified by HSLB that her check in the amount ofP20,000,000.00 was just presented to the bank for payment. She claimed that it was only then that she remembered that sometime in 1995, she was informed by her employee that one of her checks was missing. At that time, she did not let it bother her thinking that it would eventually surface when presented to the bank. Respondent Nicdao could not explain how the said check came into petitioner Chings possession. She explained that she kept her checks in an ordinary cash box together with a stapler and the cigarette wrappers that contained Nuguids computations. Her saleslady had access to this box. Respondent Nicdao averred that it was Nuguid who offered to give her a loan as she would allegedly need money to manage Vignette Superstore. Nuguid used to run the said store before respondent Nicdaos daughter bought it from Nuguids family, its previous owner. According to respondent Nicdao, it was Nuguid who regularly delivered the cash to respondent Nicdao or, if she was not at the grocery store, to her saleslady. Respondent Nicdao denied any knowledge that the money loaned to her by Nuguid belonged to petitioner Ching. At the continuation of her directexamination,19 respondent Nicdao said that she never dealt with petitioner Ching because it was Nuguid who went to the grocery store everyday to collect the interest payments. When shown theP20,000,000.00 check, respondent Nicdao admitted that the signature thereon was hers but she denied issuing it as a blank check to petitioner Ching. On the other hand, with respect to the other ten (10) checks, she also admitted that the signatures thereon were hers and that the amounts thereon were written by either Josie Nicdao or Melanie Tolentino, her employees whom she authorized to do so. With respect to the payee, it was purposely left blank allegedly upon instruction of Nuguid who said that she would use the checks to pay someone else. On cross-examination,20 respondent Nicdao explained that Josie Nicdao and Melanie Tolentino were caretakers of the grocery store and that they manned it when she was not there. She likewise confirmed that she authorized them to write the amounts on the checks after she had affixed her signature thereon. She stressed, however, that the P20,000,000.00 check was the one that was

reported to her as lost or missing by her saleslady sometime in 1995. She never reported the matter to the bank because she was confident that it would just surface when it would be presented for payment. Again, respondent Nicdao identified the cigarette wrappers which indicated the daily payments she had made to Nuguid. The latter allegedly went to the grocery store everyday to collect the interest payments. Further, the figures at the back of the cigarette wrappers were written by Nuguid. Respondent Nicdao asserted that she recognized her handwriting because Nuguid sometimes wrote them in her presence. Respondent Nicdao maintained that she had already paid Nuguid the amount of P1,200,000.00 as evidenced by the Planters Bank demand draft which she gave to the latter and which was subsequently negotiated and deposited in petitioner Chings account. In connection thereto, respondent Nicdao refuted the prosecutions allegation that the demand draft was payment for a previous transaction that she had with petitioner Ching. She clarified that the payments that Nuguid collected from her everyday were only for the interests due. She did not ask Nuguid to make written acknowledgements of her payments. Melanie Tolentino was presented to corroborate the testimony of respondent Nicdao. On directexamination,21Tolentino stated that she worked at the Vignette Superstore and she knew Nuguid because her employer, respondent Nicdao, used to borrow money from her. She knew petitioner Ching only by name and that he was the "husband" of Nuguid. As an employee of the grocery store, Tolentino stated that she acted as its caretaker and was entrusted with the custody of respondent Nicdaos personal checks. Tolentino identified her own handwriting on some of the checks especially with respect to the amounts and figures written thereon. She said that Nuguid instructed her to leave the space for the payee blank as she would use the checks to pay someone else. Tolentino added that she could not recall respondent Nicdao issuing a check to petitioner Ching in the amount of P20,000,000.00. She confirmed that they lost a check sometime in 1995. When informed about it, respondent Nicdao told her that the check could have been issued to someone else, and that it would just surface when presented to the bank. Tolentino recounted that Nuguid came to the grocery store everyday to collect the interest payments of the loan. In some instances, upon respondent Nicdaos instruction, Tolentino

handed to Nuguid checks that were already signed by respondent Nicdao. Sometimes, Tolentino would be the one to write the amount on the checks. Nuguid, in turn, wrote the amounts on pieces of paper which were kept by respondent Nicdao. On cross-examination,22 Tolentino confirmed that she was authorized by respondent Nicdao to fill up the checks and hand them to Nuguid. The latter came to the grocery store everyday to collect the interest payments. Tolentino claimed that in 1995, in the course of chronologically arranging respondent Nicdaos check booklets, she noticed that a check was missing. Respondent Nicdao told her that perhaps she issued it to someone and that it would just turn up in the bank. Tolentino was certain that the missing check was the same one that petitioner Ching presented to the bank for payment in the amount of P20,000,000.00. Tolentino stated that she left the employ of respondent Nicdao sometime in 1996. After the checks were dishonored in October 1997, Tolentino got a call from respondent Nicdao. After she was shown a fax copy thereof, Tolentino confirmed that the P20,000,000.00 check was the same one that she reported as missing in 1995. Jocelyn Nicdao also took the witness stand to corroborate the testimony of the other defense witnesses. On direct-examination,23 she averred that she was a saleslady at the Vignette Superstore from August 1994 up to April 1998. She knew Nuguid as well as petitioner Ching. Jocelyn Nicdao further testified that respondent Nicdao was indebted to Nuguid. Jocelyn Nicdao used to fill up the checks of respondent Nicdao that had already been signed by her and give them to Nuguid. The latter came to the grocery store everyday to pick up the interest payments. Jocelyn Nicdao identified the checks on which she wrote the amounts and, in some instances, the name of Nuguid as payee. However, most of the time, Nuguid allegedly instructed her to leave as blank the space for the payee. Jocelyn Nicdao identified the cigarette wrappers as the documents on which Nuguid acknowledged receipt of the interest payments. She explained that she was the one who wrote the minus entries and they represented the daily interest payments received by Nuguid. On cross-examination,24 Jocelyn Nicdao stated that she was a distant cousin of respondent Nicdao. She stopped working for her in 1998

because she wanted to take a rest. Jocelyn Nicdao reiterated that she handed the checks to Nuguid at the grocery store. After due trial, on December 8, 1998, the MCTC rendered judgment in Criminal Cases Nos. 9433-9443 convicting respondent Nicdao of eleven (11) counts of violation of BP 22. The MCTC gave credence to petitioner Chings testimony that respondent Nicdao borrowed money from him in the total amount of P20,950,000.00. Petitioner Ching delivered P1,000,000.00 every month to respondent Nicdao from 1995 up to 1997 until the sum reachedP20,000,000.00. The MCTC also found that subsequent thereto, respondent Nicdao still borrowed money from petitioner Ching. As security for these loans, respondent Nicdao issued checks to petitioner Ching. When the latter deposited the checks (eleven in all) on October 6, 1997, they were dishonored by the bank for being "DAIF." The MCTC explained that the crime of violation of BP 22 has the following elements: (a) the making, drawing and issuance of any check to apply to account or for value; (b) the knowledge of the maker, drawer or issuer that at the time of issue he does not have sufficient funds in or credit with the drawee bank for the payment of such check in full upon its presentment; and (c) subsequent dishonor of the check by the drawee bank for insufficiency of funds or credit or dishonor for the same reason had not the drawer, without any valid cause, ordered the bank to stop payment.25 According to the MCTC, all the foregoing elements are present in the case of respondent Nicdaos issuance of the checks subject of Criminal Cases Nos. 9433-9443. On the first element, respondent Nicdao was found by the MCTC to have made, drawn and issued the checks. The fact that she did not personally write the payee and date on the checks was not material considering that under Section 14 of the Negotiable Instruments Law, "where the instrument is wanting in any material particular, the person in possession thereof has a prima facie authority to complete it by filling up the blanks therein. And a signature on a blank paper delivered by the person making the signature in order that the paper may be converted into a negotiable instrument operates as a prima facie authority to fill it up as such for any amount x x x." Respondent Nicdao admitted that she authorized her employees to provide the details on the checks after she had signed them. The MCTC disbelieved respondent Nicdaos claim that the P20,000,000.00 check was the

same one that she lost in 1995. It observed that ordinary prudence would dictate that a lost check would at least be immediately reported to the bank to prevent its unauthorized endorsement or negotiation. Respondent Nicdao made no such report to the bank. Even if the said check was indeed lost, the MCTC faulted respondent Nicdao for being negligent in keeping the checks that she had already signed in an unsecured box. The MCTC further ruled that there was no evidence to show that petitioner Ching was not a holder in due course as to cause it (the MCTC) to believe that the said check was not issued to him. Respondent Nicdaos admission of indebtedness was sufficient to prove that there was consideration for the issuance of the checks. The second element was also found by the MCTC to be present as it held that respondent Nicdao, as maker, drawer or issuer, had knowledge that at the time of issue she did not have sufficient funds in or credit with the drawee bank for the payment in full of the checks upon their presentment. As to the third element, the MCTC established that the checks were subsequently dishonored by the drawee bank for being "DAIF" or drawn against insufficient funds. Stamped at the back of each check was the annotation "DAIF." The bank representative likewise testified to the fact of dishonor. Under the foregoing circumstances, the MCTC declared that the conviction of respondent Nicdao was warranted. It stressed that the mere act of issuing a worthless check was malum prohibitum; hence, even if the checks were issued in the form of deposit or guarantee, once dishonored, the same gave rise to the prosecution for and conviction of BP 22. 26 The decretal portion of the MCTC decision reads: WHEREFORE, in view of the foregoing, the accused is found guilty of violating Batas Pambansa Blg. 22 in 11 counts, and is hereby ordered to pay the private complainant the amount of P20,950,000.00 plus 12% interest per annum from date of filing of the complaint until the total amount had been paid. The prayer for moral damages is denied for lack of evidence to prove the same. She is likewise ordered to suffer imprisonment equivalent to 1 year for every check issued and which penalty shall be served successively. SO ORDERED.27

10

Incidentally, on January 11, 1999, the MCTC likewise rendered its judgment in Criminal Cases Nos. 9458-9471 and convicted respondent Nicdao of the fourteen (14) counts of violation of BP 22 filed against her by Nuguid. On appeal, the Regional Trial Court (RTC) of Dinalupihan, Bataan, Branch 5, in separate Decisions both dated May 10, 1999, affirmed in toto the decisions of the MCTC convicting respondent Nicdao of eleven (11) and fourteen (14) counts of violation of BP 22 in Criminal Cases Nos. 9433-9443 and 9458-9471, respectively. Respondent Nicdao forthwith filed with the CA separate petitions for review of the two decisions of the RTC. The petition involving the eleven (11) checks purportedly issued to petitioner Ching was docketed as CA-G.R. CR No. 23055 (assigned to the 13th Division). On the other hand, the petition involving the fourteen (14) checks purportedly issued to Nuguid was docketed as CA-G.R. CR No. 23054 (originally assigned to the 7th Division but transferred to the 6th Division). The Office of the Solicitor General (OSG) filed its respective comments on the said petitions. Subsequently, the OSG filed in CA-G.R. CR No. 23055 a motion for its consolidation with CA-G.R. CR No. 23054. The OSG prayed that CA-G.R. CR No. 23055 pending before the 13th Division be transferred and consolidated with CA-G.R. CR No. 23054 in accordance with the Revised Internal Rules of the Court of Appeals (RIRCA). Acting on the motion for consolidation, the CA in CA-G.R. CR No. 23055 issued a Resolution dated October 19, 1999 advising the OSG to file the motion in CA-G.R. CR No. 23054 as it bore the lowest number. Respondent Nicdao opposed the consolidation of the two cases. She likewise filed her reply to the comment of the OSG in CA-G.R. CR No. 23055. On November 22, 1999, the CA (13th Division) rendered the assailed Decision in CA-G.R. CR No. 23055 acquitting respondent Nicdao of the eleven (11) counts of violation of BP 22 filed against her by petitioner Ching. The decretal portion of the assailed CA Decision reads: WHEREFORE, being meritorious, the petition for review is hereby GRANTED. Accordingly, the decision dated May 10, 1999, of the Regional Trial Court, 3rd Judicial Region, Branch 5, Bataan, affirming the decision dated December 8, 1998, of the First Municipal Circuit Trial Court of Dinalupihan-Hermosa, Bataan, convicting petitioner Clarita S. Nicdao in Criminal Cases No. 9433 to 9443 of violation of B.P. Blg. 22 is

REVERSED and SET ASIDE and another judgment rendered ACQUITTING her in all these cases, with costs de oficio. SO ORDERED.28 On even date, the CA issued an Entry of Judgment declaring that the above decision has become final and executory and is recorded in the Book of Judgments. In acquitting respondent Nicdao in CA-G.R. CR No. 23055, the CA made the following factual findings: Petitioner [respondent herein] Clarita S. Nicdao, a middle-aged mother and housekeeper who only finished high school, has a daughter, Janette Boyd, who is married to a wealthy expatriate. Complainant [petitioner herein] Samson Ching is a Chinese national, who claimed he is a salesman of La Suerte Cigar and Cigarette Factory. Emma Nuguid, complainants live-in partner, is a CPA and formerly connected with Sycip, Gorres and Velayo. Nuguid used to own a grocery store now known as the Vignette Superstore. She sold this grocery store, which was about to be foreclosed, to petitioners daughter, Janette Boyd. Since then, petitioner began managing said store. However, since petitioner could not always be at the Vignette Superstore to keep shop, she entrusted to her salesladies, Melanie Tolentino and Jocelyn Nicdao, pre-signed checks, which were left blank as to amount and the payee, to cover for any delivery of merchandise sold at the store. The blank and personal checks were placed in a cash box at Vignette Superstore and were filled up by said salesladies upon instruction of petitioner as to amount, payee and date. Soon thereafter, Emma Nuguid befriended petitioner and offered to lend money to the latter which could be used in running her newly acquired store. Nuguid represented to petitioner that as former manager of the Vignette Superstore, she knew that petitioner would be in need of credit to meet the daily expenses of running the business, particularly in the daily purchases of merchandise to be sold at the store. After Emma Nuguid succeeded in befriending petitioner, Nuguid was able to gain access to the Vignette Superstore where petitioners blank and pre-signed checks were kept.29

11

In addition, the CA also made the finding that respondent Nicdao borrowed money from Nuguid in the total amount of P2,100,000.00 secured by twenty-four (24) checks drawn against respondent Nicdaos account with HSLB. Upon Nuguids instruction, the checks given by respondent Nicdao as security for the loans were left blank as to the payee and the date. The loans consisted of (a) P950,000.00 covered by ten (10) checks subject of the criminal complaints filed by petitioner Ching (CA-G.R. CR No. 23055); and (b) P1,150,000.00 covered by fourteen (14) checks subject of the criminal complaints filed by Nuguid (CA-G.R. CR No. 23054). The loans totaledP2,100,000.00 and they were transacted between respondent Nicdao and Nuguid only. Respondent Nicdao never dealt with petitioner Ching. Against the foregoing factual findings, the CA declared that, based on the evidence, respondent Nicdao had already fully paid the loans. In particular, the CA referred to the Planters Bank demand draft in the amount ofP1,200,000.00 which, by his own admission, petitioner Ching had received. The appellate court debunked petitioner Chings allegation that the said demand draft was payment for a previous transaction. According to the CA, petitioner Ching failed to adduce evidence to prove the existence of a previous transaction between him and respondent Nicdao. Apart from the demand draft, the CA also stated that respondent Nicdao made interest payments on a daily basis to Nuguid as evidenced by the computations written at the back of the cigarette wrappers. Based on these computations, as of July 21, 1997, respondent Nicdao had made a total of P5,780,000.00 payments to Nuguid for the interests alone. Adding up this amount and that of the Planters Bank demand draft, the CA placed the payments made by respondent Nicdao to Nuguid as already amounting to P6,980,000.00 for the principal loan amount of only P2,100,000.00. The CA negated petitioner Chings contention that the payments as reflected at the back of the cigarette wrappers could be applied only to the interests due. Since the transactions were not evidenced by any document or writing, the CA ratiocinated that no interests could be collected because, under Article 1956 of the Civil Code, "no interest shall be due unless it has been expressly stipulated in writing." The CA gave credence to the testimony of respondent Nicdao that when she had fully paid her loans to Nuguid, she tried to retrieve her checks. Nuguid, however, refused to return the

checks to respondent Nicdao. Instead, Nuguid and petitioner Ching filled up the said checks to make it appear that: (a) petitioner Ching was the payee in five checks; (b) the six checks were payable to cash; (c) Nuguid was the payee in fourteen (14) checks. Petitioner Ching and Nuguid then put the date October 6, 1997 on all these checks and deposited them the following day. On October 8, 1997, through a joint demand letter, they informed respondent Nicdao that her checks were dishonored by HSLB and gave her three days to settle her indebtedness or else face prosecution for violation of BP 22. With the finding that respondent Nicdao had fully paid her loan obligations to Nuguid, the CA declared that she could no longer be held liable for violation of BP 22. It was explained that to be held liable under BP 22, it must be established, inter alia, that the check was made or drawn and issued to apply on account or for value. According to the CA, the word "account" refers to a pre-existing obligation, while "for value" means an obligation incurred simultaneously with the issuance of the check. In the case of respondent Nicdaos checks, the pre-existing obligations secured by them were already extinguished after full payment had been made by respondent Nicdao to Nuguid. Obligations are extinguished by, among others, payment.30 The CA believed that when petitioner Ching and Nuguid refused to return respondent Nicdaos checks despite her total payment of P6,980,000.00 for the loans secured by the checks, petitioner Ching and Nuguid were using BP 22 to coerce respondent Nicdao to pay a debt which she no longer owed them. With respect to the P20,000,000.00 check, the CA was not convinced by petitioner Chings claim that he deliveredP1,000,000.00 every month to respondent Nicdao until the amount reached P20,000,000.00 and, when she refused to pay the same, he filled up the check, which she earlier delivered to him as security for the loans, by writing thereon the said amount. In disbelieving petitioner Ching, the CA pointed out that, contrary to his assertion, he was never employed by the La Suerte Cigar and Cigarette Manufacturing per the letter of Susan Resurreccion, Vice-President and Legal Counsel of the said company. Moreover, as admitted by petitioner Ching, he did not own the house where he and Nuguid lived. Moreover, the CA characterized as incredible and contrary to human experience that petitioner Ching would, as he claimed, deliver a total sum of P20,000,000.00 to respondent Nicdao without any documentary proof thereof, e.g., written acknowledgment that she received

12

the same. On the other hand, it found plausible respondent Nicdaos version of the story that the P20,000,000.00 check was the same one that was missing way back in 1995. The CA opined that this missing check surfaced in the hands of petitioner Ching who, in cahoots with Nuguid, wrote the amount P20,000,000.00 thereon and deposited it in his account. To the mind of the CA, the inference that the check was stolen was anchored on competent circumstantial evidence. Specifically, Nuguid, as previous manager/owner of the grocery store, had access thereto. Likewise applicable, according to the CA, was the presumption that the person in possession of the stolen article was presumed to be guilty of taking the stolen article.31 The CA emphasized that the P20,000,000.00 check was never delivered by respondent Nicdao to petitioner Ching. As such, the said check without the details as to the date, amount and payee, was an incomplete and undelivered instrument when it was stolen and ended up in petitioner Chings hands. On this point, the CA applied Sections 15 and 16 of the Negotiable Instruments Law: SEC. 15. Incomplete instrument not delivered. Where an incomplete instrument has not been delivered, it will not, if completed and negotiated without authority, be a valid contract in the hands of any holder, as against any person whose signature was placed thereon before delivery. SEC. 16. Delivery; when effectual; when presumed. Every contract on a negotiable instrument is incomplete and revocable until delivery of the instrument for the purpose of giving effect thereto. As between immediate parties and as regards a remote party other than a holder in due course, the delivery, in order to be effectual, must be made either by or under the authority of the party making, drawing, accepting or indorsing, as the case may be; and, in such case, the delivery may be shown to have been conditional, or for a special purpose only, and not for the purpose of transferring the property. But where the instrument is in the hands of a holder in due course, a valid delivery thereof by all parties prior to him so as to make them liable to him is conclusively presumed. And where the instrument is no longer in the possession of a party whose signature appears thereon, a valid and intentional delivery by him is presumed until the contrary is proved. The CA held that the P20,000,000.00 check was filled up by petitioner Ching without respondent Nicdaos authority. Further, it was incomplete

and undelivered. Hence, petitioner Ching did not acquire any right or interest therein and could not assert any cause of action founded on the stolen checks.32 Under these circumstances, the CA concluded that respondent could not be held liable for violation of BP 22. The Petitioners Case As mentioned earlier, the instant petition pertains and is limited solely to the civil aspect of the case as petitioner Ching argues that notwithstanding respondent Nicdaos acquittal of the eleven (11) counts of violation of BP 22, she should be held liable to pay petitioner Ching the amounts of the dishonored checks in the aggregate sum ofP20,950,000.00. He urges the Court to review the findings of facts made by the CA as they are allegedly based on a misapprehension of facts and manifestly erroneous and contradicted by the evidence. Further, the CAs factual findings are in conflict with those of the RTC and MCTC. Petitioner Ching vigorously argues that notwithstanding respondent Nicdaos acquittal by the CA, the Supreme Court has the jurisdiction and authority to resolve and rule on her civil liability. He invokes Section 1, Rule 111 of the Revised Rules of Court which, prior to its amendment, provided, in part: SEC. 1. Institution of criminal and civil actions. When a criminal action is instituted, the civil action for the recovery of civil liability is impliedly instituted with the criminal action, unless the offended party waives the civil action, reserves his right to institute it separately, or institutes the civil action prior to the criminal action. Such civil action includes the recovery of indemnity under the Revised Penal Code, and damages under Articles 32, 33, 34 and 2176 of the Civil Code of the Philippines arising from the same act or omission of the accused. x x x Supreme Court Circular No. 57-97 33 dated September 16, 1997 is also cited as it provides in part: 1. The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to necessarily include the corresponding civil action, and no reservation to file such civil action separately shall be allowed or recognized. x x x

13

Petitioner Ching theorizes that, under Section 1, Rule 111 of the Revised Rules of Court, the civil action for the recovery of damages under Articles 32, 33, 34, and 2176 arising from the same act or omission of the accused is impliedly instituted with the criminal action. Moreover, under the above-quoted Circular, the criminal action for violation of BP 22 necessarily includes the corresponding civil action, which is the recovery of the amount of the dishonored check representing the civil obligation of the drawer to the payee. In seeking to enforce the alleged civil liability of respondent Nicdao, petitioner Ching maintains that she had loan obligations to him totaling P20,950,000.00. The existence of the same is allegedly established by his testimony before the MCTC. Also, he asks the Court to take judicial notice that for a monetary loan secured by a check, the check itself is the evidence of indebtedness. He insists that, contrary to her protestation, respondent Nicdao also transacted with him, not only with Nuguid. Petitioner Ching pointed out that during respondent Nicdaos testimony, she referred to her creditors in plural form, e.g. "[I] told them, most checks that I issued I will inform them if I have money." Even respondent Nicdaos employees allegedly knew him; they testified that Nuguid instructed them at times to leave as blank the payee on the checks as they would be paid to someone else, who turned out to be petitioner Ching. It was allegedly erroneous for the CA to hold that he had no capacity to lend P20,950,000.00 to respondent Nicdao. Petitioner Ching clarified that what he meant when he testified before the MCTC was that he was engaged in dealership with La Suerte Cigar and Cigarette Manufacturing, and not merely its sales agent. He stresses that he owns a warehouse and is also in the business of lending money. Further, the CAs reasoning that he could not possibly have lent P20,950,000.00 to respondent Nicdao since petitioner Ching and Nuguid did not own the house where they live, is allegedly non sequitur. Petitioner Ching maintains that, contrary to the CAs finding, the Planters Bank demand draft for P1,200,000.00 was in payment for respondent Nicdaos previous loan transaction with him. Apart from the P20,000,000.00 check, the other ten (10) checks (totaling P950,000.00) were allegedly issued by respondent Nicdao to petitioner Ching as security for the loans that she obtained from him from 1995 to 1997. The existence of another loan obligation prior to the said period was allegedly established by the

testimony of respondent Nicdaos own witness, Jocelyn Nicdao, who testified that when she started working in Vignette Superstore in 1994, she noticed that respondent Nicdao was already indebted to Nuguid. Petitioner Ching also takes exception to the CAs ruling that the payments made by respondent Nicdao as reflected on the computations at the back of the cigarette wrappers were for both the principal loan and interests. He insists that they were for the interests alone. Even respondent Nicdaos testimony allegedly showed that they were daily interest payments. Petitioner Ching further avers that the interest payments totaling P5,780,000.00 can only mean that, contrary to respondent Nicdaos claim, her loan obligations amounted to much more thanP2,100,000.00. Further, she is allegedly estopped from questioning the interests because she willingly paid the same. Petitioner Ching also harps on respondent Nicdaos silence when she received his and Nuguids demand letter to her. Through the said letter, they notified her that the twenty-five (25) checks valued at P22,100,000.00 were dishonored by the HSLB, and that she had three days to settle her ndebtedness with them, otherwise, face prosecution. Respondent Nicdaos silence, i.e., her failure to deny or protest the same by way of reply, vis--vis the demand letter, allegedly constitutes an admission of the statements contained therein. On the other hand, the MCTCs decision, as affirmed by the RTC, is allegedly based on the evidence on record; it has been established that the checks were respondent Nicdaos personal checks, that the signatures thereon were hers and that she had issued them to petitioner Ching. With respect to the P20,000,000.00 check, petitioner Ching assails the CAs ruling that it was stolen and was never delivered or issued by respondent Nicdao to him. The issue of the said check being stolen was allegedly not raised during trial. Further, her failure to report the alleged theft to the bank to stop payment of the said lost or missing check is allegedly contrary to human experience. Petitioner Ching describes respondent Nicdaos defense of stolen or lost check as incredible and, therefore, false. Aside from the foregoing substantive issues that he raised, petitioner Ching also faults the CA for not acting and ordering the consolidation of CAG.R. CR No. 23055 with CA-G.R. CR No. 23054. He informs the Court that latter case is still pending with the CA.

14

In fine, it is petitioner Chings view that the CA gravely erred in disregarding the findings of the MCTC, as affirmed by the RTC, and submits that there is more than sufficient preponderant evidence to hold respondent Nicdao civilly liable to him in the amount of P20,950,000.00. He thus prays that the Court direct respondent Nicdao to pay him the said amount plus 12% interest per annum computed from the date of written demand until the total amount is fully paid. The Respondents Counter-Arguments Respondent Nicdao urges the Court to deny the petition. She posits preliminarily that it is barred under Section 2(b), Rule 111 of the Revised Rules of Court which states: SEC. 2. Institution of separate of civil action. Except in the cases provided for in Section 3 hereof, after the criminal action has been commenced, the civil action which has been reserved cannot be instituted until final judgment in the criminal action. xxxx (b) Extinction of the penal action does not carry with it extinction of the civil, unless the extinction proceeds from a declaration in a final judgment that the fact from which the civil might arise did not exist. According to respondent Nicdao, the assailed CA decision has already made a finding to the effect that the fact upon which her civil liability might arise did not exist. She refers to the ruling of the CA that the P20,000,000.00 check was stolen; hence, petitioner Ching did not acquire any right or interest over the said check and could not assert any cause of action founded on the said check. Consequently, the CA held that respondent Nicdao had no obligation to make good the stolen check and cannot be held liable for violation of BP 22. She also refers to the CAs pronouncement relative to the ten (10) other checks that they were not issued to apply on account or for value, considering that the loan obligations secured by these checks had already been extinguished by her full payment thereof. To respondent Nicdaos mind, these pronouncements are equivalent to a finding that the facts upon which her civil liability may arise do not exist. The instant petition, which seeks to enforce her civil liability based on the eleven (11) checks, is thus allegedly already barred by the final and executory decision acquitting her.

In any case, respondent Nicdao contends that the CA did not commit serious misapprehension of facts when it found that the P20,000,000.00 check was a stolen check and that she never made any transaction with petitioner Ching. Moreover, the other ten (10) checks were not issued to apply on account or for value. These findings are allegedly supported by the evidence on record which consisted of the respective testimonies of the defense witnesses to the effect that: respondent Nicdao had the practice of leaving pre-signed checks placed inside an unsecured cash box in the Vignette Superstore; the salesladies were given the authority to fill up the said checks as to the amount, payee and date; Nuguid beguiled respondent Nicdao to obtain loans from her; as security for the loans, respondent Nicdao issued checks to Nuguid; when the salesladies gave the checks to Nuguid, she instructed them to leave blank the payee and date; Nuguid had access to the grocery store; in 1995, one of the salesladies reported that a check was missing; in 1997, when she had fully paid her loans to Nuguid, respondent Nicdao tried to retrieve her checks but Nuguid and petitioner Ching falsely told her that she still owed them money; they then maliciously filled up the checks making it appear that petitioner Ching was the payee in the five checks and the six others were payable to "cash"; and knowing fully well that these checks were not funded because respondent Nicdao already fully paid her loans, petitioner Ching and Nuguid deposited the checks and caused them to be dishonored by HSLB. It is pointed out by respondent Nicdao that her testimony (that the P20,000,000.00 check was the same one that she lost sometime in 1995) was corroborated by the respective testimonies of her employees. Another indication that it was stolen was the fact that among all the checks which ended up in the hands of petitioner Ching and Nuguid, only the P20,000,000.00 check was fully typewritten; the rest were invariably handwritten as to the amounts, payee and date. Respondent Nicdao defends the CAs conclusion that the P20,000,000.00 check was stolen on the ground that an appeal in a criminal case throws open the whole case to the appellate courts scrutiny. In any event, she maintains that she had been consistent in her theory of defense and merely relied on the disputable presumption that the person in possession of a stolen article is presumed to be the author of the theft. Considering that it was stolen, respondent Nicdao argues, the P20,000,000.00 check was an incomplete and undelivered instrument in the hands of petitioner Ching and he did not

15

acquire any right or interest therein. Further, he cannot assert any cause of action founded on the said stolen check. Accordingly, petitioner Chings attempt to collect payment on the said check through the instant petition must fail. Respondent Nicdao describes as downright incredible petitioner Chings testimony that she owed him a total sum of P20,950,000.00 without any documentary proof of the loan transactions. She submits that it is contrary to human experience for loan transactions involving such huge amounts of money to be devoid of any documentary proof. In relation thereto, respondent Nicdao underscores that petitioner Ching lied about being employed as a salesman of La Suerte Cigar and Cigarette Manufacturing. It is underscored that he has not adequately shown that he possessed the financial capacity to lend such a huge amount to respondent Nicdao as he so claimed. Neither could she be held liable for the ten (10) other checks (in the total amount of P950,000,000.00) because as respondent Nicdao asseverates, she merely issued them to Nuguid as security for her loans obtained from the latter beginning October 1995 up to 1997. As evidenced by the Planters Bank demand draft in the amount ofP1,200,000.00, she already made payment in 1996. The said demand draft was negotiated to petitioner Chings account and he admitted receipt thereof. Respondent Nicdao belies his claim that the demand draft was payment for a prior existing obligation. She asserts that petitioner Ching was unable to present evidence of such a previous transaction. In addition to the Planters Bank demand draft, respondent Nicdao insists that petitioner Ching received, through Nuguid, cash payments as evidenced by the computations written at the back of the cigarette wrappers. Nuguid went to the Vignette Superstore everyday to collect these payments. The other defense witnesses corroborated this fact. Petitioner Ching allegedly never disputed the accuracy of the accounts appearing on these cigarette wrappers; nor did he dispute their authenticity and accuracy. Based on the foregoing evidence, the CA allegedly correctly held that, computing the amount of the Planters Bank demand draft (P1,200,000.00) and those reflected at the back of the cigarette wrappers (P5,780,000.00), respondent Nicdao had already paid petitioner Ching and Nuguid a total sum of P6,980,000.00 for her loan obligations totaling only P950,000.00, as secured by the ten (10)

HSLB checks excluding stolenP20,000,000.00 check.

the

Respondent Nicdao rebuts petitioner Chings argument (that the daily payments were applied to the interests), and claims that this is illegal. Petitioner Ching cannot insist that the daily payments she made applied only to the interests on the loan obligations, considering that there is admittedly no document evidencing these loans, hence, no written stipulation for the payment of interests thereon. On this point, she invokes Article 1956 of the Civil Code, which proscribes the collection of interest payments unless expressly stipulated in writing. Respondent Nicdao emphasizes that the ten (10) other checks that she issued to Nuguid as security for her loans had already been discharged upon her full payment thereof. It is her belief that these checks can no longer be used to coerce her to pay a debt that she does not owe. On the CAs failure to consolidate CA-G.R. CR No. 23055 and CA-G.R. CR No. 23054, respondent Nicdao proffers the explanation that under the RIRCA, consolidation of the cases is not mandatory. In fine, respondent Nicdao urges the Court to deny the petition as it failed to discharge the burden of proving her civil liability with the required preponderance of evidence. Moreover, the CAs acquittal of respondent Nicdao is premised on the finding that, apart from the stolen check, the ten (10) other checks were not made to apply to a valid, due and demandable obligation. This, in effect, is a categorical ruling that the fact from which the civil liability of respondent Nicdao may arise does not exist. The Courts Rulings The petition is denied for lack of merit. Notwithstanding respondent Nicdaos acquittal, petitioner Ching is entitled to appeal the civil aspect of the case within the reglementary period It is axiomatic that "every person criminally liable for a felony is also civilly liable." 34 Under the pertinent provision of the Revised Rules of Court, the civil action is generally impliedly instituted with the criminal action. At the time of petitioner Chings filing of the Informations against respondent Nicdao, Section 1, 35 Rule 111 of the Revised Rules of Court, quoted earlier, provided in part:

16

SEC. 1. Institution of criminal and civil actions. When a criminal action is instituted, the civil action for the recovery of civil liability is impliedly instituted with the criminal action, unless the offended party waives the civil action, reserves his right to institute it separately, or institutes the civil action prior to the criminal action. Such civil action includes the recovery of indemnity under the Revised Penal Code, and damages under Articles 32, 33, 34 and 2176 of the Civil Code of the Philippines arising from the same act or omission of the accused. xxxx As a corollary to the above rule, an acquittal does not necessarily carry with it the extinguishment of the civil liability of the accused. Section 2(b)36 of the same Rule, also quoted earlier, provided in part: (b) Extinction of the penal action does not carry with it extinction of the civil, unless the extinction proceeds from a declaration in a final judgment that the fact from which the civil might arise did not exist. It is also relevant to mention that judgments of acquittal are required to state "whether the evidence of the prosecution absolutely failed to prove the guilt of the accused or merely failed to prove his guilt beyond reasonable doubt. In either case, the judgment shall determine if the act or omission from which the civil liability might arise did not exist."37 In Sapiera v. Court of Appeals, the Court enunciated that the civil liability is not extinguished by acquittal: (a) where the acquittal is based on reasonable doubt; (b) where the court expressly declares that the liability of the accused is not criminal but only civil in nature; and (c) where the civil liability is not derived from or based on the criminal act of which the accused is acquitted. Thus, under Article 29 of the Civil Code ART. 29. When the accused in a criminal prosecution is acquitted on the ground that his guilt has not been proved beyond reasonable doubt, a civil action for damages for the same act or omission may be instituted. Such action requires only a preponderance of evidence. Upon motion of the defendant, the court may require the plaintiff to file a bond to answer for damages in case the complaint should be found to be malicious.
38

If in a criminal case the judgment of acquittal is based upon reasonable doubt, the court shall so declare. In the absence of any declaration to that effect, it may be inferred from the text of the decision whether or not the acquittal is due to that ground. The Court likewise expounded in Salazar v. People39 the consequences of an acquittal on the civil aspect in this wise: The acquittal of the accused does not prevent a judgment against him on the civil aspect of the criminal case where: (a) the acquittal is based on reasonable doubt as only preponderance of evidence is required; (b) the court declared that the liability of the accused is only civil; (c) the civil liability of the accused does not arise from or is not based upon the crime of which the accused is acquitted. Moreover, the civil action based on the delict is extinguished if there is a finding in the final judgment in the criminal action that the act or omission from which the civil liability may arise did not exist or where the accused did not commit the act or omission imputed to him. If the accused is acquitted on reasonable doubt but the court renders judgment on the civil aspect of the criminal case, the prosecution cannot appeal from the judgment of acquittal as it would place the accused in double jeopardy. However, the aggrieved party, the offended party or the accused or both may appeal from the judgment on the civil aspect of the case within the period therefor. From the foregoing, petitioner Ching correctly argued that he, as the offended party, may appeal the civil aspect of the case notwithstanding respondent Nicdaos acquittal by the CA. The civil action was impliedly instituted with the criminal action since he did not reserve his right to institute it separately nor did he institute the civil action prior to the criminal action. Following the long recognized rule that "the appeal period accorded to the accused should also be available to the offended party who seeks redress of the civil aspect of the decision," the period to appeal granted to petitioner Ching is the same as that granted to the accused.40 With petitioner Chings timely filing of the instant petition for review of the civil aspect of the CAs decision, the Court thus has the jurisdiction and authority to determine the civil liability of respondent Nicdao notwithstanding her acquittal.

17

In order for the petition to prosper, however, it must establish that the judgment of the CA acquitting respondent Nicdao falls under any of the three categories enumerated in Salazar and Sapiera, to wit: (a) where the acquittal is based on reasonable doubt as only preponderance of evidence is required; (b) where the court declared that the liability of the accused is only civil; and (c) where the civil liability of the accused does not arise from or is not based upon the crime of which the accused is acquitted. Salazar also enunciated that the civil action based on the delict is extinguished if there is a finding in the final judgment in the criminal action that the act or omission from which the civil liability may arise did not exist or where the accused did not commit the act or omission imputed to him. For reasons that will be discussed shortly, the Court holds that respondent Nicdao cannot be held civilly liable to petitioner Ching. The acquittal of respondent Nicdao likewise effectively extinguished her civil liability A painstaking review of the case leads to the conclusion that respondent Nicdaos acquittal likewise carried with it the extinction of the action to enforce her civil liability. There is simply no basis to hold respondent Nicdao civilly liable to petitioner Ching. First, the CAs acquittal of respondent Nicdao is not merely based on reasonable doubt. Rather, it is based on the finding that she did not commit the act penalized under BP 22. In particular, the CA found that the P20,000,000.00 check was a stolen check which was never issued nor delivered by respondent Nicdao to petitioner Ching. As such, according to the CA, petitioner Ching "did not acquire any right or interest over Check No. 002524 and cannot assert any cause of action founded on said check,"41 and that respondent Nicdao "has no obligation to make good the stolen check and cannot, therefore, be held liable for violation of B.P. Blg. 22."42 With respect to the ten (10) other checks, the CA established that the loans secured by these checks had already been extinguished after full payment had been made by respondent Nicdao. In this connection, the second element for the

crime under BP 22, i.e., "that the check is made or drawn and issued to apply on account or for value," is not present. Second, in acquitting respondent Nicdao, the CA did not adjudge her to be civilly liable to petitioner Ching. In fact, the CA explicitly stated that she had already fully paid her obligations. The CA computed the payments made by respondent Nicdao vis--vis her loan obligations in this manner: Clearly, adding the payments recorded at the back of the cigarette cartons by Emma Nuguid in her own handwriting totaling P5,780,000.00 and the P1,200,000.00 demand draft received by Emma Nuguid, it would appear that petitioner [respondent herein] had already made payments in the total amount of P6,980,000.00 for her loan obligation of only P2,100,000.00 (P950,000.00 in the case at bar and P1,150,000.00 in CA-G.R. CR No. 23054).43 On the other hand, its finding relative to the P20,000,000.00 check that it was a stolen check necessarily absolved respondent Nicdao of any civil liability thereon as well. Third, while petitioner Ching attempts to show that respondent Nicdaos liability did not arise from or was not based upon the criminal act of which she was acquitted (ex delicto) but from her loan obligations to him (ex contractu), however, petitioner Ching miserably failed to prove by preponderant evidence the existence of these unpaid loan obligations. Significantly, it can be inferred from the following findings of the CA in its decision acquitting respondent Nicdao that the act or omission from which her civil liability may arise did not exist. On theP20,000,000.00 check, the CA found as follows: True, indeed, the missing pre-signed and undated check no. 002524 surfaced in the possession of complainant Ching who, in cahoots with his paramour Emma Nuguid, filled up the blank check with his name as payee and in the fantastic amount of P20,000,000.00, dated it October 6, 1997, and presented it to the bank on October 7, 1997, along with the other checks, for payment. Therefore, the inference that the check was stolen is anchored on competent circumstantial evidence. The fact already established is that Emma Nuguid , previous owner of the store, had access to said store. Moreover, the possession of a thing that was stolen , absent a credible reason, as in this case, gives rise to the presumption that the person in possession of the stolen article is

18

presumed to be guilty of taking the stolen article (People v. Zafra, 237 SCRA 664). As previously shown, at the time check no. 002524 was stolen, the said check was blank in its material aspect (as to the name of payee, the amount of the check, and the date of the check), but was already pre-signed by petitioner. In fact, complainant Ching himself admitted that check no. 002524 in his possession was a blank check (TSN, Jan. 7, 1998, pp. 24-27, Annex J, Petition). Moreover, since it has been established that check no. 002524 had been missing since 1995 (TSN, Sept. 9, 1998, pp. 14-15, Annex DD, Petition; TSN, Sept. 10, 1998, pp. 43-46, Annex EE, Petition), it is abundantly clear that said check was never delivered to complainant Ching. Check no. 002524 was an incomplete and undelivered instrument when it was stolen and ended up in the hands of complainant Ching. Sections 15 and 16 of the Negotiable Instruments Law provide: xxxx In the case of check no. 002524, it is admitted by complainant Ching that said check in his possession was a blank check and was subsequently completed by him alone without authority from petitioner. Inasmuch as check no. 002524 was incomplete and undelivered in the hands of complainant Ching, he did not acquire any right or interest therein and cannot, therefore, assert any cause of action founded on said stolen check (Development Bank of the Philippines v. Sima We, 219 SCRA 736, 740). It goes without saying that since complainant Ching did not acquire any right or interest over check no. 002524 and cannot assert any cause of action founded on said check, petitioner has no obligation to make good the stolen check and cannot, therefore, be held liable for violation of B.P. Blg. 22.44 Anent the other ten (10) checks, the CA made the following findings: Evidence sufficiently shows that the loans secured by the ten (10) checks involved in the cases subject of this petition had already been paid. It is not controverted that petitioner gave Emma Nuguid a demand draft valued atP1,200,000 to pay for the loans guaranteed by said checks and other checks issued to her. Samson Ching admitted having received the demand draft which he deposited in his bank account. However, complainant Samson Ching claimed that the said demand draft represents

payment for a previous obligation incurred by petitioner. However, complainant Ching failed to adduce any evidence to prove the existence of the alleged obligation of the petitioner prior to those secured by the subject checks. Apart from the payment to Emma Nuguid through said demand draft, it is also not disputed that petitioner made cash payments to Emma Nuguid who collected the payments almost daily at the Vignette Superstore. As of July 21, 1997, Emma Nuguid collected cash payments amounting to approximately P5,780,000.00. All of these cash payments were recorded at the back of cigarette cartons by Emma Nuguid in her own handwriting, the authenticity and accuracy of which were never denied by either complainant Ching or Emma Nuguid. Clearly, adding the payments recorded at the back of the cigarette cartons by Emma Nuguid in her own handwriting totaling P5,780,000.00 and the P1,200,000.00 demand draft received by Emma Nuguid, it would appear that petitioner had already made payments in the total amount of P6,980,000.00 for her loan in the total amount of P6,980,000.00 for her loan obligation of only P2,100,000.00 (P950,000.00 in the case at bar and P1,150,000.00 in CA-G.R. CR No. 23054).45 Generally checks may constitute evidence of indebtedness.46 However, in view of the CAs findings relating to the eleven (11) checks - that the P20,000,000.00 was a stolen check and the obligations secured by the other ten (10) checks had already been fully paid by respondent Nicdao they can no longer be given credence to establish respondent Nicdaos civil liability to petitioner Ching. Such civil liability, therefore, must be established by preponderant evidence other than the discredited checks. After a careful examination of the records of the case,47 the Court holds that the existence of respondent Nicdaos civil liability to petitioner Ching in the amount of P20,950,000.00 representing her unpaid obligations to the latter has not been sufficiently established by preponderant evidence. Petitioner Ching mainly relies on his testimony before the MCTC to establish the existence of these unpaid obligations. In gist, he testified that from October 1995 up to 1997, respondent Nicdao obtained loans from him in the total amount of P20,950,000.00. As security for her obligations, she issued eleven (11) checks which were invariably blank as to the date, amounts and payee. When respondent Nicdao allegedly refused to pay her obligations despite his due demand, petitioner filled up the checks

19

in his possession with the corresponding amounts and date and deposited them in his account. They were subsequently dishonored by the HSLB for being "DAIF" and petitioner Ching accordingly filed the criminal complaints against respondent Nicdao for violation of BP 22. It is a basic rule in evidence that the burden of proof lies on the party who makes the allegations Et incumbit probatio, qui dicit, non qui negat; cum per rerum naturam factum negantis probatio nulla sit (The proof lies upon him who affirms, not upon him who denies; since, by the nature of things, he who denies a fact cannot produce any proof). 48 In civil cases, the party having the burden of proof must establish his case by a preponderance of evidence. Preponderance of evidence is the weight, credit, and value of the aggregate evidence on either side and is usually considered to be synonymous with the term "greater weight of evidence" or "greater weight of the credible evidence." Preponderance of evidence is a phrase which, in the last analysis, means probability of the truth. It is evidence which is more convincing to the court as worthy of belief than that which is offered in opposition thereto.49 Section 1, Rule 133 of the Revised Rules of Court offers the guidelines in determining preponderance of evidence: SEC. 1. Preponderance of evidence, how determined. In civil cases, the party having the burden of proof must establish his case by a preponderance of evidence. In determining where the preponderance or superior weight of evidence on the issues involved lies, the court may consider all the facts and circumstances of the case, the witnesses manner of testifying, their intelligence, their means and opportunity of knowing the facts to which they are testifying, the nature of the facts to which they testify, the probability or improbability of their testimony, their interest or want of interest, and also their personal credibility so far as the same may legitimately appear upon the trial. The court may also consider the number of witnesses, though the preponderance is not necessarily with the greater number. Unfortunately, petitioner Chings testimony alone does not constitute preponderant evidence to establish respondent Nicdaos civil liability to him amounting to P20,950,000.00. Apart from the discredited checks, he failed to adduce any other documentary evidence to prove that respondent Nicdao still has unpaid obligations to him in the said amount. Bare allegations, unsubstantiated by evidence, are not equivalent to proof under our Rules.50

In contrast, respondent Nicdaos defense consisted in, among others, her allegation that she had already paid her obligations to petitioner Ching through Nuguid. In support thereof, she presented the Planters Bank demand draft for P1,200,000.00. The said demand draft was negotiated to petitioner Chings account and he admitted receipt of the value thereof. Petitioner Ching tried to controvert this by claiming that it was payment for a previous transaction between him and respondent Nicdao. However, other than his self-serving claim, petitioner Ching did not proffer any documentary evidence to prove the existence of the said previous transaction. Considering that the Planters Bank demand draft was dated August 13, 1996, it is logical to conclude that, absent any evidence to the contrary, it formed part of respondent Nicdaos payment to petitioner Ching on account of the loan obligations that she obtained from him since October 1995. Additionally, respondent Nicdao submitted as evidence the cigarette wrappers at the back of which were written the computations of the daily payments that she had made to Nuguid. The fact of the daily payments was corroborated by the other witnesses for the defense, namely, Jocelyn Nicdao and Tolentino. As found by the CA, based on these computations, respondent Nicdao had made a total payment of P5,780,000.00 to Nuguid as of July 21, 1997.51 Again, the payments made, as reflected at the back of these cigarette wrappers, were not disputed by petitioner Ching. Hence, these payments as well as the amount of the Planters Bank demand draft establish that respondent Nicdao already paid the total amount of P6,980,000.00 to Nuguid and petitioner Ching. The Court agrees with the CA that the daily payments made by respondent Nicdao amounting to P5,780,000.00 cannot be considered as interest payments only. Even respondent Nicdao testified that the daily payments that she made to Nuguid were for the interests due. However, as correctly ruled by the CA, no interests could be properly collected in the loan transactions between petitioner Ching and respondent Nicdao because there was no stipulation therefor in writing. To reiterate, under Article 1956 of the Civil Code, "no interest shall be due unless it has been expressly stipulated in writing." Neither could respondent Nicdao be considered to be estopped from denying the validity of these interests. Estoppel cannot give validity to an act that is prohibited by law or one that is against public policy.52 Clearly, the collection of

20

interests without any stipulation therefor in writing is prohibited by law. Consequently, the daily payments made by respondent Nicdao amounting to P5,780,000.00 were properly considered by the CA as applying to the principal amount of her loan obligations. With respect to the P20,000,000.00 check, the defense of respondent Nicdao that it was stolen and that she never issued or delivered the same to petitioner Ching was corroborated by the other defense witnesses, namely, Tolentino and Jocelyn Nicdao. All told, as between petitioner Ching and respondent Nicdao, the requisite quantum of evidence - preponderance of evidence indubitably lies with respondent Nicdao. As earlier intimated, she cannot be held civilly liable to petitioner Ching for her acquittal; under the circumstances which have just been discussed lengthily, such acquittal carried with it the extinction of her civil liability as well. The CA committed no reversible error in not consolidating CA-G.R. CR No. 23055 and CAG.R. CR No. 23054 During the pendency of CA-G.R. CR No. 23055 and CA-G.R. CR No. 23054 in the CA, the pertinent provision of the RIRCA on consolidation of cases provided: SEC. 7. Consolidation of Cases. Whenever two or more allied cases are assigned to different Justices, they may be consolidated for study and report to a single Justice. (a) At the instance of any party or Justice to whom the case is assigned for study and report, and with the conformity of all the Justices concerned, the consolidation may be allowed when the cases to be consolidated involve the same parties and/or related questions of fact and/or law.53 The use of the word "may" denotes the permissive, not mandatory, nature of the above provision, Thus, no grave error could be imputed to the CA when it proceeded to render its decision in CA-G.R. CR No. 23055, without consolidating it with CA-G.R. CR No. 23054. WHEREFORE, premises considered, the Petition is DENIED for lack of merit. SO ORDERED. G.R. No. 154207 April 27, 2007

FERDINAND A. CRUZ, Petitioner, vs. ALBERTO MINA, HON. ELEUTERIO F. GUERRERO and HON. ZENAIDA LAGUILLES, Respondents. DECISION AUSTRIA-MARTINEZ, J.: Before the Court is a Petition for Certiorari under Rule 65 of the Rules of Court, grounded on pure questions of law, with Prayer for Preliminary Injunction assailing the Resolution dated May 3, 2002 promulgated by the Regional Trial Court (RTC), Branch 116, Pasay City, in Civil Case No. 02-0137, which denied the issuance of a writ of preliminary injunction against the Metropolitan Trial Court (MeTC), Branch 45, Pasay City, in Criminal Case No. 00-1705;1 and the RTCs Order dated June 5, 2002 denying the Motion for Reconsideration. No writ of preliminary injunction was issued by this Court. The antecedents: On September 25, 2000, Ferdinand A. Cruz (petitioner) filed before the MeTC a formal Entry of Appearance, as private prosecutor, in Criminal Case No. 00-1705 for Grave Threats, where his father, Mariano Cruz, is the complaining witness. The petitioner, describing himself as a third year law student, justifies his appearance as private prosecutor on the bases of Section 34 of Rule 138 of the Rules of Court and the ruling of the Court En Banc in Cantimbuhan v. Judge Cruz, Jr.2 that a non-lawyer may appear before the inferior courts as an agent or friend of a party litigant. The petitioner furthermore avers that his appearance was with the prior conformity of the public prosecutor and a written authority of Mariano Cruz appointing him to be his agent in the prosecution of the said criminal case. However, in an Order dated February 1, 2002, the MeTC denied permission for petitioner to appear as private prosecutor on the ground that Circular No. 19 governing limited law student practice in conjunction with Rule 138-A of the Rules of Court (Law Student Practice Rule) should take precedence over the ruling of the Court laid down in Cantimbuhan; and set the case for continuation of trial.3 On February 13, 2002, petitioner filed before the MeTC a Motion for Reconsideration seeking to reverse the February 1, 2002 Order alleging

21

that Rule 138-A, or the Law Student Practice Rule, does not have the effect of superseding Section 34 of Rule 138, for the authority to interpret the rule is the source itself of the rule, which is the Supreme Court alone. In an Order dated March 4, 2002, the MeTC denied the Motion for Reconsideration. On April 2, 2002, the petitioner filed before the RTC a Petition for Certiorari and Mandamus with Prayer for Preliminary Injunction and Temporary Restraining Order against the private respondent and the public respondent MeTC. After hearing the prayer for preliminary injunction to restrain public respondent MeTC Judge from proceeding with Criminal Case No. 00-1705 pending the Certiorari proceedings, the RTC, in a Resolution dated May 3, 2002, resolved to deny the issuance of an injunctive writ on the ground that the crime of Grave Threats, the subject of Criminal Case No. 001705, is one that can be prosecuted de oficio, there being no claim for civil indemnity, and that therefore, the intervention of a private prosecutor is not legally tenable. On May 9, 2002, the petitioner filed before the RTC a Motion for Reconsideration. The petitioner argues that nowhere does the law provide that the crime of Grave Threats has no civil aspect. And last, petitioner cites Bar Matter No. 730 dated June 10, 1997 which expressly provides for the appearance of a non-lawyer before the inferior courts, as an agent or friend of a party litigant, even without the supervision of a member of the bar. Pending the resolution of the foregoing Motion for Reconsideration before the RTC, the petitioner filed a Second Motion for Reconsideration dated June 7, 2002 with the MeTC seeking the reversal of the March 4, 2002 Denial Order of the said court, on the strength of Bar Matter No. 730, and a Motion to Hold In Abeyance the Trial dated June 10, 2002 of Criminal Case No. 00-1705 pending the outcome of the certiorari proceedings before the RTC. On June 5, 2002, the RTC issued its Order denying the petitioners Motion for Reconsideration. Likewise, in an Order dated June 13, 2002, the MeTC denied the petitioners Second Motion for Reconsideration and his Motion to Hold in Abeyance the Trial on the ground that the RTC had already denied the Entry of Appearance of petitioner before the MeTC.

On July 30, 2002, the petitioner directly filed with this Court, the instant Petition and assigns the following errors: I. the respondent regional trial court abused its discretion when it resolved to deny the prayer for the writ of injunction of the herein petitioner despite petitioner having established the necessity of granting the writ; II. THE RESPONDENT TRIAL COURT ABUSED ITS DISCRETION, TANTAMOUNT TO IGNORANCE OF THE LAW, WHEN IT RESOLVED TO DENY THE PRAYER FOR THE WRIT OF PRELIMINARY INJUNCTION AND THE SUBSEQUENT MOTION FOR RECONSIDERATION OF THE HEREIN PETITIONER ON THE BASIS THAT [GRAVE] THREATS HAS NO CIVIL ASPECT, FOR THE SAID BASIS OF DENIAL IS NOT IN ACCORD WITH THE LAW; III. THE RESPONDENT METROPOLITAN TRIAL COURT ABUSED ITS DISCRETION WHEN IT DENIED THE MOTION TO HOLD IN ABEYANCE TRIAL, WHEN WHAT WAS DENIED BY THE RESPONDENT REGIONAL TRIAL COURT IS THE ISSUANCE OF THE WRIT OF PRELIMINARY INJUNCTION and WHEN THE RESPONDENT REGIONAL TRIAL COURT IS YET TO DECIDE ON THE MERITS OF THE PETITION FOR CERTIORARI; IV. THE RESPONDENT COURT[s] ARE CLEARLY IGNORING THE LAW WHEN THEY PATENTLY REFUSED TO HEED TO [sic] THE CLEAR MANDATE OF THE LAPUT, CANTIMBUHAN AND BULACAN CASES, AS WELL AS BAR MATTER NO. 730, PROVIDING FOR THE APPEARANCE OF NON-LAWYERS BEFORE THE LOWER COURTS (MTCS).4 This Court, in exceptional cases, and for compelling reasons, or if warranted by the nature of the issues reviewed, may take cognizance of petitions filed directly before it.5 Considering that this case involves the interpretation, clarification, and implementation of Section 34, Rule 138 of the Rules of Court, Bar Matter No. 730, Circular No. 19 governing law student practice and Rule 138-A of the Rules of Court, and the ruling of the Court

22

in Cantimbuhan, the Court takes cognizance of herein petition. The basic question is whether the petitioner, a law student, may appear before an inferior court as an agent or friend of a party litigant. The courts a quo held that the Law Student Practice Rule as encapsulated in Rule 138-A of the Rules of Court, prohibits the petitioner, as a law student, from entering his appearance in behalf of his father, the private complainant in the criminal case without the supervision of an attorney duly accredited by the law school. Rule 138-A or the Law Student Practice Rule, provides: RULE LAW STUDENT PRACTICE RULE 138-A

and his appearance must be either personal or by a duly authorized member of the bar. Thus, a law student may appear before an inferior court as an agent or friend of a party without the supervision of a member of the bar.7 (Emphasis supplied) The phrase "In the court of a justice of the peace" in Bar Matter No. 730 is subsequently changed to "In the court of a municipality" as it now appears in Section 34 of Rule 138, thus: 8 SEC. 34. By whom litigation is conducted. In the Court of a municipality a party may conduct his litigation in person, with the aid of an agent or friend appointed by him for that purpose, or with the aid of an attorney. In any other court, a party may conduct his litigation personally or by aid of an attorney and his appearance must be either personal or by a duly authorized member of the bar. (Emphasis supplied) which is the prevailing rule at the time the petitioner filed his Entry of Appearance with the MeTC on September 25, 2000. No real distinction exists for under Section 6, Rule 5 of the Rules of Court, the term "Municipal Trial Courts" as used in these Rules shall include Metropolitan Trial Courts, Municipal Trial Courts in Cities, Municipal Trial Courts, and Municipal Circuit Trial Courts. There is really no problem as to the application of Section 34 of Rule 138 and Rule 138-A. In the former, the appearance of a non-lawyer, as an agent or friend of a party litigant, is expressly allowed, while the latter rule provides for conditions when a law student, not as an agent or a friend of a party litigant, may appear before the courts. Petitioner expressly anchored his appearance on Section 34 of Rule 138. The court a quo must have been confused by the fact that petitioner referred to himself as a law student in his entry of appearance. Rule 138-A should not have been used by the courts a quo in denying permission to act as private prosecutor against petitioner for the simple reason that Rule 138-A is not the basis for the petitioners appearance. Section 34, Rule 138 is clear that appearance before the inferior courts by a non-lawyer is allowed, irrespective of whether or not he is a law student. As succinctly clarified in Bar Matter No. 730, by virtue of Section 34, Rule 138, a law student may appear, as an agent or a friend of a party litigant, without the supervision of a lawyer before inferior courts.

Section 1. Conditions for Student Practice. A law student who has successfully completed his 3rd year of the regular four-year prescribed law curriculum and is enrolled in a recognized law school's clinical legal education program approved by the Supreme Court, may appear without compensation in any civil, criminal or administrative case before any trial court, tribunal, board or officer, to represent indigent clients accepted by the legal clinic of the law school. Sec. 2. Appearance. The appearance of the law student authorized by this rule, shall be under the direct supervision and control of a member of the Integrated Bar of the Philippines duly accredited by the law school. Any and all pleadings, motions, briefs, memoranda or other papers to be filed, must be signed by the supervising attorney for and in behalf of the legal clinic. However, in Resolution6 dated June 10, 1997 in Bar Matter No. 730, the Court En Banc clarified: The rule, however, is different if the law student appears before an inferior court, where the issues and procedure are relatively simple. In inferior courts, a law student may appear in his personal capacity without the supervision of a lawyer. Section 34, Rule 138 provides: Sec. 34. By whom litigation is conducted. - In the court of a justice of the peace , a party may conduct his litigation in person, with the aid of an agent or friend appointed by him for that purpose, or with the aid of an attorney. In any other court, a party may conduct his litigation personally or by aid of an attorney,

23

Petitioner further argues that the RTC erroneously held that, by its very nature, no civil liability may flow from the crime of Grave Threats, and, for this reason, the intervention of a private prosecutor is not possible. It is clear from the RTC Decision that no such conclusion had been intended by the RTC. In denying the issuance of the injunctive court, the RTC stated in its Decision that there was no claim for civil liability by the private complainant for damages, and that the records of the case do not provide for a claim for indemnity; and that therefore, petitioners appearance as private prosecutor appears to be legally untenable. Under Article 100 of the Revised Penal Code, every person criminally liable for a felony is also civilly liable except in instances when no actual damage results from an offense, such as espionage, violation of neutrality, flight to an enemy country, and crime against popular representation.9 The basic rule applies in the instant case, such that when a criminal action is instituted, the civil action for the recovery of civil liability arising from the offense charged shall be deemed instituted with criminal action, unless the offended party waives the civil action, reserves the right to institute it separately or institutes the civil action prior to the criminal action.10 The petitioner is correct in stating that there being no reservation, waiver, nor prior institution of the civil aspect in Criminal Case No. 00-1705, it follows that the civil aspect arising from Grave Threats is deemed instituted with the criminal action, and, hence, the private prosecutor may rightfully intervene to prosecute the civil aspect. WHEREFORE, the Petition is GRANTED. The assailed Resolution and Order of the Regional Trial Court, Branch 116, Pasay City are REVERSED and SET ASIDE. The Metropolitan Trial Court, Branch 45, Pasay City is DIRECTED to ADMIT the Entry of Appearance of petitioner in Criminal Case No. 00-1705 as a private prosecutor under the direct control and supervision of the public prosecutor. No pronouncement as to costs. SO ORDERED. G.R. No. 173807 April 16, 2009

LETICIA CHING and EDWIN CASTA, Respondents. DECISION TINGA, J.: The right to recover due and demandable pecuniary obligations incurred by juridical persons such as corporations cannot be impaired by procedural rules. Our rules of procedure governing the litigation of criminal actions for violation of Batas Pambansa Blg. 22 (B.P. 22) have given the appearance of impairing such substantive rights, and we take the opportunity herein to assert the necessary clarifications. Before us is a Rule 45 petition 1 which seeks the reversal of the Decision2 of the Court of Appeals in CA-GR No. 29488. The Court of Appeals' decision affirmed the decision3 of the Regional Trial Court of Pasig, Branch 68 in Criminal Case No. 120482. The RTC's decision reversed the decision4 of the Metropolitan Trial Court of San Juan, Branch 58 in Criminal Case No. 70445 which involved a charge of violation of B.P. Blg. 22 against respondents Leticia Ching (Ching) and Edwin Casta (Casta). On 16 February 2000, petitioner Jaime Gosiaco (petitioner) invested P8,000,000.00 with ASB Holdings, Inc. (ASB) by way of loan. The money was loaned to ASB for a period of 48 days with interest at 10.5% which is equivalent toP112,000.00. In exchange, ASB through its Business Development Operation Group manager Ching, issued DBS checks no. 0009980577 and 0009980578 for P8,000,000.00 and P112,000.00 respectively. The checks, both signed by Ching, were drawn against DBS Bank Makati Head Office branch. ASB, through a letter dated 31 March 2000, acknowledged that it owed petitioner the abovementioned amounts. 5 Upon maturity of the ASB checks, petitioner went to the DBS Bank San Juan Branch to deposit the two (2) checks. However, upon presentment, the checks were dishonored and payments were refused because of a stop payment order and for insufficiency of funds. Petitioner informed respondents, through letters dated 6 and 10 April 2000,6about the dishonor of the checks and demanded replacement checks or the return of the money placement but to no avail. Thus, petitioner filed a criminal complaint for violation of B.P. Blg. 22 before the Metropolitan Trial Court of San Juan against the private respondents.

JAIME U. GOSIACO, Petitioner, vs.

24

Ching was arraigned and tried while Casta remained at large. Ching denied liability and claimed that she was a mere employee of ASB. She asserted that she did not have knowledge as to how much money ASB had in the banks. Such responsibility, she claimed belonged to another department. On 15 December 2000, petitioner moved7 that ASB and its president, Luke Roxas, be impleaded as party defendants. Petitioner, then, paid the corresponding docket fees. However, the MTC denied the motion as the case had already been submitted for final decision. 8 On 8 February 2001, the MTC acquitted Ching of criminal liability but it did not absolve her from civil liability. The MTC ruled that Ching, as a corporate officer of ASB, was civilly liable since she was a signatory to the checks.9 Both petitioner and Ching appealed the ruling to the RTC. Petitioner appealed to the RTC on the ground that the MTC failed to hold ASB and Roxas either jointly or severally liable with Ching. On the other hand, Ching moved for a reconsideration which was subsequently denied. Thereafter, she filed her notice of appeal on the ground that she should not be held civilly liable for the bouncing checks because they were contractual obligations of ASB. On 12 July 2005, the RTC rendered its decision sustaining Ching's appeal. The RTC affirmed the MTCs ruling which denied the motion to implead ASB and Roxas for lack of jurisdiction over their persons. The RTC also exonerated Ching from civil liability and ruled that the subject obligation fell squarely on ASB. Thus, Ching should not be held civilly liable.10 Petitioner filed a petition for review with the Court of Appeals on the grounds that the RTC erred in absolving Ching from civil liability; in upholding the refusal of the MTC to implead ASB and Roxas; and in refusing to pierce the corporate veil of ASB and hold Roxas liable. On 19 July 2006, the Court of Appeals affirmed the decision of the RTC and stated that the amount petitioner sought to recover was a loan made to ASB and not to Ching. Roxas testimony further bolstered the fact that the checks issued by Ching were for and in behalf of ASB. The Court of Appeals ruled that ASB cannot be impleaded in a B.P. Blg. 22 case since it is not a natural person and in the case of Roxas, he was not the subject of a preliminary investigation. Lastly, the Court of Appeals ruled that there was no need to pierce the corporate

veil of ASB since none of the requisites were present.11 Hence this petition. Petitioner raised the following issues: (1) is a corporate officer who signed a bouncing check civilly liable under B.P. Blg. 22; (2) can a corporation be impleaded in a B.P. Blg. 22 case; and (3) is there a basis to pierce the corporate veil of ASB? B.P. Blg. 22 is popularly known as the Bouncing Checks Law. Section 1 of B.P. Blg. 22 provides: xxx xxx xxx Where the check is drawn by a corporation, company or entity, the person or persons, who actually signed the check in behalf of such drawer shall be liable under this Act. B.P. Blg. 22 was enacted to address the rampant issuance of bouncing checks as payment for pre-existing obligations. The circulation of bouncing checks adversely affected confidence in trade and commerce. The State criminalized such practice because it was deemed injurious to public interests 12 and was found to be pernicious and inimical to public welfare.13 B.P. Blg. 22 punishes the act of making and issuing bouncing checks. It is the act itself of issuing the checks which is considered malum prohibitum. The law is an offense against public order and not an offense against property.14 It penalizes the issuance of a check without regard to its purpose. It covers all types of checks.15 Even checks that were issued as a form of deposit or guarantee were held to be within the ambit of B.P. Blg. 22.161avvphi1.zw+ When a corporate officer issues a worthless check in the corporate name he may be held personally liable for violating a penal statute.17 The statute imposes criminal penalties on anyone who with intent to defraud another of money or property, draws or issues a check on any bank with knowledge that he has no sufficient funds in such bank to meet the check on presentment.18 Moreover, the personal liability of the corporate officer is predicated on the principle that he cannot shield himself from liability from his own acts on the ground that it was a corporate act and not his personal act.19 As we held in Llamado v. Court of Appeals:20 Petitioner's argument that he should not be held personally liable for the amount of the check because it was a check of the Pan Asia

25

Finance Corporation and he signed the same in his capacity as Treasurer of the corporation, is also untenable. The third paragraph of Section 1 of BP Blg. 22 states: "Where the check is drawn by a corporation, company or entity, the person or persons who actually signed the check in behalf of such drawer shall be liable under this Act." The general rule is that a corporate officer who issues a bouncing corporate check can only be held civilly liable when he is convicted. In the recent case of Bautista v. Auto Plus Traders Inc.,21 the Court ruled decisively that the civil liability of a corporate officer in a B.P. Blg. 22 case is extinguished with the criminal liability. We are not inclined through this case to revisit so recent a precedent, and the rule of stare decisis precludes us to discharge Ching of any civil liability arising from the B.P. Blg. 22 case against her, on account of her acquittal in the criminal charge. We recognize though the bind entwining the petitioner. The records clearly show that it is ASB is civilly obligated to petitioner. In the various stages of this case, petitioner has been proceeding from the premise that he is unable to pursue a separate civil action against ASB itself for the recovery of the amounts due from the subject checks. From this premise, petitioner sought to implead ASB as a defendant to the B.P. Blg. 22 case, even if such case is criminal in nature.22 What supplied the notion to the petitioner that he was unable to pursue a separate civil action against ASB? He cites the Revised Rules on Criminal Procedure, particularly the provisions involving B.P. Blg. 22 cases, which state that:

or exemplary damages, the offended party shall pay the filing fees based on the amounts alleged therein. If the amounts are not so alleged but any of these damages are subsequently awarded by the court, the filing fees based on the amount awarded shall constitute a first lien on the judgment. Where the civil action has been filed separately and trial thereof has not yet commenced, it may be consolidated with the criminal action upon application with the court trying the latter case. If the application is granted, the trial of both actions shall proceed in accordance with section 2 of this Rule governing consolidation of the civil and criminal actions.23 We are unable to agree with petitioner that he is entitled to implead ASB in the B.P. Blg. 22 case, or any other corporation for that matter, even if the Rules require the joint trial of both the criminal and civil liability. A basic maxim in statutory construction is that the interpretation of penal laws is strictly construed against the State and liberally construed against the accused. Nowhere in B.P. Blg. 22 is it provided that a juridical person may be impleaded as an accused or defendant in the prosecution for violations of that law, even in the litigation of the civil aspect thereof. Nonetheless, the substantive right of a creditor to recover due and demandable obligations against a debtor-corporation cannot be denied or diminished by a rule of procedure. Technically, nothing in Section 1(b) of Rule 11 prohibits the reservation of a separate civil action against the juridical person on whose behalf the check was issued. What the rules prohibit is the reservation of a separate civil action against the natural person charged with violating B.P. Blg. 22, including such corporate officer who had signed the bounced check.

Rule 111, Section 1Institution of criminal and civil action. xxx (b) The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to include the corresponding civil action. No reservation to file such civil action separately shall be allowed. Upon filing of the aforesaid joint criminal and civil actions, the offended party shall pay in full the filing fees based on the amount of the check involved, which shall be considered as the actual damages claimed. Where the complainant or information also seeks to recover liquidated, moral, nominal, temperate

In theory the B.P. Blg. 22 criminal liability of the person who issued the bouncing check in behalf of a corporation stands independent of the civil liability of the corporation itself, such civil liability arising from the Civil Code. B.P. Blg. 22 itself fused this criminal liability of the signer of the check in behalf of the corporation with the corresponding civil liability of the corporation itself by allowing the complainant to recover such civil liability not from the corporation, but from the person who signed the check in its behalf. Prior to the amendments to our rules on criminal procedure, it though clearly was permissible to pursue the criminal liability against the signatory, while going after the corporation itself for the civil liability.

26

However, with the insistence under the amended rules that the civil and criminal liability attaching to the bounced check be pursued jointly, the previous option to directly pursue the civil liability against the person who incurred the civil obligationthe corporation itselfis no longer that clear. In theory, the implied institution of the civil case into the criminal case for B.P. Blg. 22 should not affect the civil liability of the corporation for the same check, since such implied institution concerns the civil liability of the signatory, and not of the corporation. Let us pursue this point further. B.P. Blg. 22 imposes a distinct civil liability on the signatory of the check which is distinct from the civil liability of the corporation for the amount represented from the check. The civil liability attaching to the signatory arises from the wrongful act of signing the check despite the insufficiency of funds in the account, while the civil liability attaching to the corporation is itself the very obligation covered by the check or the consideration for its execution. Yet these civil liabilities are mistaken to be indistinct. The confusion is traceable to the singularity of the amount of each. If we conclude, as we should, that under the current Rules of Criminal Procedure, the civil action that is impliedly instituted in the B.P. Blg. 22 action is only the civil liability of the signatory, and not that of the corporation itself, the distinctness of the cause of action against the signatory and that against the corporation is rendered beyond dispute. It follows that the actions involving these liabilities should be adjudged according to their respective standards and merits. In the B.P. Blg. 22 case, what the trial court should determine whether or not the signatory had signed the check with knowledge of the insufficiency of funds or credit in the bank account, while in the civil case the trial court should ascertain whether or not the obligation itself is valid and demandable. The litigation of both questions could, in theory, proceed independently and simultaneously without being ultimately conclusive on one or the other. It might be argued that under the current rules, if the signatory were made liable for the amount of the check by reason of the B.P. Blg. 22 case, such signatory would have the option of recovering the same amount from the corporation. Yet that prospect does not ultimately satisfy the ends of justice. If the signatory does not have sufficient assets to answer for the amount of the checka distinct possibility considering the occasional large-

scale transactions engaged in by corporations the corporation would not be subsidiarily liable to the complainant, even if it in truth the controversy, of which the criminal case is just a part, is traceable to the original obligation of the corporation. While the Revised Penal Code imposes subsidiary civil liability to corporations for criminal acts engaged in by their employees in the discharge of their duties, said subsidiary liability applies only to felonies, 24and not to crimes penalized by special laws such as B.P. Blg. 22. And nothing in B.P. Blg. 22 imposes such subsidiary liability to the corporation in whose name the check is actually issued. Clearly then, should the check signatory be unable to pay the obligation incurred by the corporation, the complainant would be bereft of remedy unless the right of action to collect on the liability of the corporation is recognized and given flesh. There are two prevailing concerns should civil recovery against the corporation be pursued even as the B.P. Blg. 22 case against the signatory remains extant. First, the possibility that the plaintiff might be awarded the amount of the check in both the B.P. Blg. 22 case and in the civil action against the corporation. For obvious reasons, that should not be permitted. Considering that petitioner herein has no chance to recover the amount of the check through the B.P. Blg. 22 case, we need not contend with that possibility through this case. Nonetheless, as a matter of prudence, it is best we refer the matter to the Committee on Rules for the formulation of proper guidelines to prevent that possibility. The other concern is over the payment of filing fees in both the B.P. Blg. 22 case and the civil action against the corporation. Generally, we see no evil or cause for distress if the plaintiff were made to pay filing fees based on the amount of the check in both the B.P. Blg. 22 case and the civil action. After all, the plaintiff therein made the deliberate option to file two separate cases, even if the recovery of the amounts of the check against the corporation could evidently be pursued through the civil action alone. Nonetheless, in petitioners particular case, considering the previous legal confusion on whether he is authorized to file the civil case against ASB, he should, as a matter of equity, be exempted from paying the filing fees based on the amount of the checks should he pursue the civil action against ASB. In a similar vein and for a similar reason, we likewise find that petitioner should not be barred by prescription should he file the civil action as the period should not run from the date the checks were

27

issued but from the date this decision attains finality. The courts should not be bound strictly by the statute of limitations or the doctrine of laches when to do so, manifest wrong or injustice would result.25 WHEREFORE, the petition is DENIED, without prejudice to the right of petitioner Jaime U. Gosiaco to pursue an independent civil action against ASB Holdings Inc. for the amount of the subject checks, in accordance with the terms of this decision. No pronouncements as to costs. Let a copy of this Decision be REFERRED to the Committee on Revision of the Rules for the formulation of the formal rules of procedure to govern the civil action for the recovery of the amount covered by the check against the juridical person which issued it. SO ORDERED. G.R. No. 174238 July 7, 2009

On March 16, 2004, the RTC, Branch 7, Manila dismissed the estafa cases for failure of the prosecution to prove the elements of the crime. The Order dismissing Criminal Case No. 98969952 contained no declaration as to the civil liability of Tessie Sy.3 On the other hand, the Order in Criminal Case No. 98-969953 contained a statement, "Hence, if there is any liability of the accused, the same is purely civil, not criminal in nature."4 Later, the MeTC, Branch 25, Manila, dismissed, on demurrer, the BP Blg. 22 cases in its Order5 dated February 7, 2005 on account of the failure of petitioner to identify the accused respondents in open court. The Order also did not make any pronouncement as to the civil liability of accused respondents.1avvphi1 On April 26, 2005, petitioner lodged against respondents before the RTC, Branch 18, Manila, a complaint6 for collection of a sum of money with damages (Civil Case No. 05-112452) based on the same loaned amount ofP600,000.00 covered by the two PBC checks previously subject of the estafa and BP Blg. 22 cases. In the assailed Order7 dated January 2, 2006, the RTC, Branch 18, Manila, dismissed the complaint for lack of jurisdiction, ratiocinating that the civil action to collect the amount of P600,000.00 with damages was already impliedly instituted in the BP Blg. 22 cases in light of Section 1, paragraph (b) of Rule 111 of the Revised Rules of Court. Petitioner filed a motion for reconsideration8 which the court denied in its Order9 dated June 5, 2006. Hence, this petition, raising the sole legal issue Whether or not Section 1 of Rule 111 of the 2000 Rules of Criminal Procedure and Supreme Court Circular No. 57-97 on the Rules and Guidelines in the filing and prosecution of criminal cases under BP Blg. 22 are applicable to the present case where the nature of the order dismissing the cases for bouncing checks against the respondents was [based] on the failure of the prosecution to identify both the accused (respondents herein)?10 Essentially, petitioner argues that since the BP Blg. 22 cases were filed on January 20, 1999, the 2000 Revised Rules on Criminal Procedure promulgated on December 1, 2000 should not apply, as it must be given only prospective application. She further contends that that her case falls within the following exceptions to the rule that the civil action correspondent to the

ANITA CHENG, Petitioner, vs. SPOUSES WILLIAM SY and TESSIE SY, Respondents. DECISION NACHURA, J.: This is a petition1 for review on certiorari under Rule 45 of the Rules of Court of the Order dated January 2, 20062of the Regional Trial Court (RTC), Branch 18, Manila in Civil Case No. 05112452 entitled Anita Cheng v. Spouses William Sy and Tessie Sy. The antecedents are as follows Petitioner Anita Cheng filed two (2) estafa cases before the RTC, Branch 7, Manila against respondent spouses William and Tessie Sy (Criminal Case No. 98-969952 against Tessie Sy and Criminal Case No. 98-969953 against William Sy) for issuing to her Philippine Bank of Commerce (PBC) Check Nos. 171762 and 71860 for P300,000.00 each, in payment of their loan, both of which were dishonored upon presentment for having been drawn against a closed account. Meanwhile, based on the same facts, petitioner, on January 20, 1999, filed against respondents two (2) cases for violation of Batas Pambansa Bilang (BP Blg.) 22 before the Metropolitan Trial Court (MeTC), Branch 25, Manila (Criminal Case Nos. 341458-59).

28

criminal action is deemed instituted with the latter (1) additional evidence as to the identities of the accused is necessary for the resolution of the civil aspect of the case; (2) a separate complaint would be just as efficacious as or even more expedient than a timely remand to the trial court where the criminal action was decided for further hearings on the civil aspect of the case; (3) the trial court failed to make any pronouncement as to the civil liability of the accused amounting to a reservation of the right to have the civil liability litigated in a separate action; (4) the trial court did not declare that the facts from which the civil liability might arise did not exist; (5) the civil complaint is based on an obligation ex-contractu and not exdelicto pursuant to Article 3111 of the Civil Code; and (6) the claim for civil liability for damages may be had under Article 2912 of the Civil Code. Petitioner also points out that she was not assisted by any private prosecutor in the BP Blg. 22 proceedings. The rule is that upon the filing of the estafa and BP Blg. 22 cases against respondents, where the petitioner has not made any waiver, express reservation to litigate separately, or has not instituted the corresponding civil action to collect the amount of P600,000.00 and damages prior to the criminal action, the civil action is deemed instituted with the criminal cases.13 This rule applies especially with the advent of the 2000 Revised Rules on Criminal Procedure. Thus, during the pendency of both the estafa and the BP Blg. 22 cases, the action to recover the civil liability was impliedly instituted and remained pending before the respective trial courts. This is consonant with our ruling in Rodriguez v. Ponferrada14 that the possible single civil liability arising from the act of issuing a bouncing check can be the subject of both civil actions deemed instituted with the estafa case and the prosecution for violation of BP Blg. 22, simultaneously available to the

complaining party, without traversing the prohibition against forum shopping. 15Prior to the judgment in either the estafa case or the BP Blg. 22 case, petitioner, as the complainant, cannot be deemed to have elected either of the civil actions both impliedly instituted in the said criminal proceedings to the exclusion of the other.16 The dismissal of the estafa cases for failure of the prosecution to prove the elements of the crime beyond reasonable doubtwhere in Criminal Case No. 98-969952 there was no pronouncement as regards the civil liability of the accused and in Criminal Case No. 98969953 where the trial court declared that the liability of the accused was only civil in nature produced the legal effect of a reservation by the petitioner of her right to litigate separately the civil action impliedly instituted with the estafa cases, following Article 29 of the Civil Code.17 However, although this civil action could have been litigated separately on account of the dismissal of the estafa cases on reasonable doubt, the petitioner was deemed to have also elected that such civil action be prosecuted together with the BP Blg. 22 cases in light of the Rodriguez v. Ponferrada ruling. With the dismissal of the BP Blg. 22 cases for failure to establish the identity of the accused, the question that arises is whether such dismissal would have the same legal effect as the dismissed estafa cases. Put differently, may petitioners action to recover respondents civil liability be also allowed to prosper separately after the BP Blg. 22 cases were dismissed? Section 1 (b), Rule 111 of the 2000 Revised Rules on Criminal Procedure states Section 1. Institution of criminal and civil actions. xxx (b) The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to include the corresponding civil action. No reservation to file such civil action separately shall be allowed. Upon filing of the joint criminal and civil actions, the offended party shall pay in full the filing fees based on the amount of the check involved, which shall be considered as the actual damages claimed. Where the complaint or information also seeks to recover liquidated, moral, nominal, temperate or exemplary damages, the offended party shall pay the filing fees based on the amounts alleged therein. If

29

the amounts are not so alleged but any damages [is] subsequently awarded court, the filing fees based on the awarded shall constitute a first lien judgment.

of these by the amount on the

Where the civil action has been filed separately and trial thereof has not yet commenced, it may be consolidated with the criminal action upon application with the court trying the latter case. If the application is granted, the trial of both actions shall proceed in accordance with section 2 of this Rule governing consolidation of the civil and criminal actions. Petitioner is in error when she insists that the 2000 Rules on Criminal Procedure should not apply because she filed her BP Blg. 22 complaints in 1999. It is now settled that rules of procedure apply even to cases already pending at the time of their promulgation. The fact that procedural statutes may somehow affect the litigants rights does not preclude their retroactive application to pending actions. It is axiomatic that the retroactive application of procedural laws does not violate any right of a person who may feel that he is adversely affected, nor is it constitutionally objectionable. The reason for this is that, as a general rule, no vested right may attach to, nor arise from, procedural laws.18 Indeed, under the present revised Rules, the criminal action for violation of BP Blg. 22 includes the corresponding civil action to recover the amount of the checks. It should be stressed, this policy is intended to discourage the separate filing of the civil action. In fact, the Rules even prohibits the reservation of a separate civil action, i.e., one can no longer file a separate civil case after the criminal complaint is filed in court. The only instance when separate proceedings are allowed is when the civil action is filed ahead of the criminal case. Even then, the Rules encourages the consolidation of the civil and criminal cases. Thus, where petitioners rights may be fully adjudicated in the proceedings before the court trying the BP Blg. 22 cases, resort to a separate action to recover civil liability is clearly unwarranted on account of res judicata, for failure of petitioner to appeal the civil aspect of the cases. In view of this special rule governing actions for violation of BP Blg. 22, Article 31 of the Civil Code is not applicable.19 Be it remembered that rules governing procedure before the courts, while not cast in stone, are for the speedy, efficient, and orderly dispensation of justice and should therefore be adhered to in order to attain this objective.20

However, in applying the procedure discussed above, it appears that petitioner would be left without a remedy to recover from respondents the P600,000.00 allegedly loaned from her. This could prejudice even the petitioners Notice of Claim involving the same amount filed in Special Proceedings No. 98-88390 (Petition for Voluntary Insolvency by Kolin Enterprises, William Sy and Tessie Sy), which case was reportedly archived for failure to prosecute the petition for an unreasonable length of time.21 Expectedly, respondents would raise the same defense that petitioner had already elected to litigate the civil action to recover the amount of the checks along with the BP Blg. 22 cases. It is in this light that we find petitioners contention that she was not assisted by a private prosecutor during the BP Blg. 22 proceedings critical. Petitioner indirectly protests that the public prosecutor failed to protect and prosecute her cause when he failed to have her establish the identities of the accused during the trial and when he failed to appeal the civil action deemed impliedly instituted with the BP Blg. 22 cases. On this ground, we agree with petitioner. Faced with the dismissal of the BP Blg. 22 cases, petitioners recourse pursuant to the prevailing rules of procedure would have been to appeal the civil action to recover the amount loaned to respondents corresponding to the bounced checks. Hence, the said civil action may proceed requiring only a preponderance of evidence on the part of petitioner. Her failure to appeal within the reglementary period was tantamount to a waiver altogether of the remedy to recover the civil liability of respondents. However, due to the gross mistake of the prosecutor in the BP Blg. 22 cases, we are constrained to digress from this rule. It is true that clients are bound by the mistakes, negligence and omission of their counsel.22 But this rule admits of exceptions (1) where the counsels mistake is so great and serious that the client is prejudiced and denied his day in court, or (2) where the counsel is guilty of gross negligence resulting in the clients deprivation of liberty or property without due process of law.23 Tested against these guidelines, we hold that petitioners lot falls within the exceptions. It is an oft-repeated exhortation to counsels to be well-informed of existing laws and rules and to keep abreast with legal developments, recent enactments and jurisprudence. Unless they faithfully comply with such duty, they may not be able to discharge competently and diligently

30

their obligations as members of the Bar.24 Further, lawyers in the government service are expected to be more conscientious in the performance of their duties as they are subject to public scrutiny. They are not only members of the Bar but are also public servants who owe utmost fidelity to public service.25 Apparently, the public prosecutor neglected to equip himself with the knowledge of the proper procedure for BP Blg. 22 cases under the 2000 Rules on Criminal Procedure such that he failed to appeal the civil action impliedly instituted with the BP Blg. 22 cases, the only remaining remedy available to petitioner to be able to recover the money she loaned to respondents, upon the dismissal of the criminal cases on demurrer. By this failure, petitioner was denied her day in court to prosecute the respondents for their obligation to pay their loan. Moreover, we take into consideration the trial courts observation when it dismissed the estafa charge in Criminal Case No. 98-969953 that if there was any liability on the part of respondents, it was civil in nature. Hence, if the loan be proven true, the inability of petitioner to recover the loaned amount would be tantamount to unjust enrichment of respondents, as they may now conveniently evade payment of their obligation merely on account of a technicality applied against petitioner. There is unjust enrichment when (1) a person is unjustly benefited, and (2) such benefit is derived at the expense of or with damages to another. This doctrine simply means that a person shall not be allowed to profit or enrich himself inequitably at anothers expense. One condition for invoking this principle of unjust enrichment is that the aggrieved party has no other recourse based on contract, quasicontract, crime, quasi-delict or any other provision of law.26 Court litigations are primarily designed to search for the truth, and a liberal interpretation and application of the rules which will give the parties the fullest opportunity to adduce proof is the best way to ferret out the truth. The dispensation of justice and vindication of legitimate grievances should not be barred by technicalities.27 For reasons of substantial justice and equity, as the complement of the legal jurisdiction that seeks to dispense justice where courts of law, through the inflexibility of their rules and want of power to adapt their judgments to the special circumstances of cases, are incompetent to do so, 28 we thus rule, pro hac vice, in favor of petitioner.

WHEREFORE, the petition is GRANTED. Civil Case No. 05-112452 entitled Anita Cheng v. Spouses William Sy and Tessie Sy is hereby ordered REINSTATED. No pronouncement as to costs. SO ORDERED. G.R. No. 169889 2009 September 29,

SPOUSES SIMON YAP AND MILAGROS GUEVARRA, Petitioners, vs. FIRST e-BANK CORPORATION (previously known as PDCP DEVELOPMENT BANK, INC.), Respondent. DECISION CORONA, J.: On August 30, 1990, Sammy Yap obtained a P2 million loan from PDCP Development Bank, Inc.1 (PDCP). As security, Sammys parents, petitioners Simon Yap and Milagros Guevarra, executed a third-party mortgage on their land2 and warehouse standing on it. The mortgage agreement provided that PDCP may extrajudicially foreclose the property in case Sammy failed to pay the loan. On November 7, 1990, Sammy issued a promissory note and six postdated checks 3 in favor of PDCP as additional securities for the loan. When Sammy defaulted on the payment of his loan, PDCP presented the six checks to the drawee bank but the said checks were dishonored.4 This prompted PDCP to file a complaint against Sammy for six counts of violation of BP 22 (Bouncing Checks Law) on February 8, 1993. On May 3, 1993, PDCP filed an application for extrajudicial foreclosure of mortgage on the property of petitioners which served as principal security for Sammys loan. On December 16, 1993, on motion of Sammy and without objection from the public prosecutor and PDCP, the BP 22 cases were provisionally dismissed. On October 26, 1994, pursuant to the petition of PDCP for extrajudicial foreclosure, the extrajudicial sale was set on December 28, 1994. Copies of the notice of extrajudicial sale were sent by registered mail to Sammy,

31

petitioners, the Registrar of Deeds of San Carlos City, Pangasinan, the Sangguniang Panglungsod of San Carlos City and the office of the barangay secretary of Taloy District, San Carlos City, Pangasinan. The notice was also published in the Sunday Punch, a newspaper of general circulation in Pangasinan on November 27, December 4 and 11, 1994. On December 20, 1994, petitioners filed in the Regional Trial Court (RTC) of San Carlos City, Pangasinan a complaint for injunction (with prayer for the issuance of a temporary restraining order/preliminary injunction), damages and accounting of payments against PDCP. The complaint sought to stop the foreclosure sale on the ground that PDCP waived its right to foreclose the mortgage on their property when it filed the BP 22 cases against Sammy. On April 2, 1997, the RTC 5 ruled in favor of petitioners. It held that PDCP had three options when Sammy defaulted in the payment of his loan: enforcement of the promissory note in a collection case, enforcement of the checks under the Negotiable Instruments Law and/or BP 22, or foreclosure of mortgage. The remedies were alternative and the choice of one excluded the others. Thus, PDCP was deemed to have waived its right to foreclose on the property of petitioners when it elected to sue Sammy for violation of BP 22.6 PDCP appealed to the Court of Appeals (CA). On February 8, 2005, the CA7 reversed the RTC. It opined that PDCP was not barred from exercising its right to foreclose on the property of petitioners despite suing Sammy for violation of BP 22. The purpose of BP 22 was to punish the act of issuing a worthless check, not to force a debtor to pay his debt.8 Hence, this appeal9 where petitioners argue that, when Sammy was sued for six counts of violation of BP 22, PDCP should have been deemed to have simultaneously filed for collection of the amount represented by the checks. The civil aspect of the case was naturally an action for collection of Sammys obligation to PDCP. PDCP clearly elected a remedy. PDCP should not be allowed to pursue another, like foreclosure of mortgage. The argument is not convincing. First, petitioners anchor their position on Supreme Court Circular 57-97, which provides for the rules and guidelines in the filing and

prosecution of criminal cases under BP 22. Pertinent portions of Circular 57-97 provide: 1. The criminal action for violation of [BP] 22 shall be deemed to necessarily include the corresponding civil action, and no reservation to file such civil action separately shall be allowed or recognized. 2. Upon the filing of the aforesaid joint criminal and civil actions, the offended party shall pay in full the filing fees based upon the amount of the check involved, which shall be considered as the actual damages claimed, in accordance with the filing fees in Section 7 (a) and Section 8 (a), Rule 141 of the Rules of Court, and last amended by Administrative Circular No. 11-94 effective August 1, 1994. Where the offended party seeks to enforce against the accused civil liability by way of liquidated, moral, nominal, temperate or exemplary damages, he shall pay the corresponding filing fees therefore based on the amounts thereof as alleged either in his complaint or in the information. If not so alleged but any of these damages are awarded by the court, the amount of such fees shall constitute a first lien on the judgment. 3. Where the civil action has heretofore been filed separately and trial thereof has not yet commenced, it may be consolidated with the criminal action upon application with the court trying the latter case. If the application is granted, the trial of both actions shall proceed in accordance with the pertinent procedure outlined in Section 2 (a) of Rule 111 governing the proceedings in the actions as thus consolidated. (emphasis supplied) Circular 57-97 has been institutionalized as Section 1(b), Rule 111 of the Rules of Court: 10 Section 1. Institution actions.xxx of criminal and civil

(b) The criminal action for violation of [BP] 22 shall be deemed to include the corresponding civil action. No reservation to file such civil action separately shall be allowed. Upon filing of the aforesaid joint criminal and civil actions, the offended party shall pay in full

32

the filing fees based on the amount of the check involved, which shall be considered as the actual damages claimed. Where the complaint or information also seeks to recover liquidated, moral, nominal, temperate or exemplary damages, the offended party shall pay additional filing fees based on the amounts alleged therein. If the amounts are not so alleged but any of these damages are subsequently awarded by the court, the filing fee based on the amount awarded shall constitute a first lien on the judgment. Where the civil action has been filed separately and trial thereof has not yet commenced, it may be consolidated with the criminal action upon application with the court trying the latter case. If the application is granted, the trial of both actions shall proceed in accordance with section 2 of this Rule governing consolidation of the civil and criminal actions. (emphasis supplied) Sad to say, Circular 57-97 (and, it goes without saying, Section 1(b), Rule 111 of the Rules of Court) was not yet in force 11 when PDCP sued Sammy for violation of BP 22 and when it filed a petition for extrajudicial foreclosure on the mortgaged property of petitioners on February 8, 1993 and May 3, 1993, respectively. In Lo Bun Tiong v. Balboa,12 Circular 57-97 was not applied because the collection suit and the criminal complaints for violation of BP 22 were filed prior to the adoption of Circular 57-97. The same principle applies here. Thus, prior to the effectivity of Circular 57-97, the alternative remedies of foreclosure of mortgage and collection suit were not barred even if a suit for BP 22 had been filed earlier, unless a judgment of conviction had already been rendered in the BP 22 case finding the accused debtor criminally liable and ordering him to pay the amount of the check(s).13 In this case, no judgment of conviction (which could have declared the criminal and civil liability of Sammy) was rendered because Sammy moved for the provisional dismissal of the case. Hence, PDCP could have still foreclosed on the mortgage or filed a collection suit. Nonetheless, records show that, during the pendency of the BP 22 case, Sammy had already paid PDCP the total amount of P1,783,582.14 Thus, to prevent unjust enrichment on the part of the creditor, any foreclosure by PDCP should only be for the unpaid balance.

Second, it is undisputed that the BP 22 cases were provisionally dismissed at Sammys instance. In other words, PDCP was prevented from recovering the whole amount by Sammy himself. To bar PDCP from foreclosing on petitioners property for the balance of the indebtedness would be to penalize PDCP for the act of Sammy. That would not only be illogical and absurd but would also violate elementary rules of justice and fair play. In sum, PDCP has not yet effectively availed of and fully exhausted its remedy. While it can be argued that PDCP may revive the BP 22 cases anytime as their dismissal was only provisional, suffice it to state that the law gives the right of choice to PDCP, not to Sammy or to petitioners.1avvph!1 Third, petitioners should be mindful that, by being third party mortgagors, they agreed that their property would stand as collateral to the loan of Sammy until the last centavo is paid to PDCP. That is a risk they willingly assumed. To release the mortgage just because they find it inconvenient would be the height of injustice against PDCP. All told, PDCP should not be left without recourse for the unsettled loan of Sammy. Otherwise, an iniquitous situation will arise where Sammy and petitioners are unjustly enriched at the expense of PDCP. That we cannot sanction. So as not to create any misunderstanding, however, the point should be underscored that the creditors obvious purpose when it forecloses on mortgaged property is to obtain payment for a loan which the debtor is unable or unjustifiably refuses to pay. The rationale is the same if the creditor opts to sue the debtor for collection. Thus, it is but logical that a creditor who obtains a personal judgment against the debtor on a loan waives his right to foreclose on the mortgage securing the loan. Otherwise, the creditor becomes guilty of splitting a single cause of action 15 for the debtors inability (or unjustified refusal) to pay his debt.16 Nemo debet bis vexare pro una et eadem causa. No man shall be twice vexed for one and the same cause. In the light of Circular 57-97 and Section 1(b), Rule 111 of the Rules of Court, the same rule applies when the creditor sues the debtor for BP 22 and thereafter forecloses on the mortgaged property. It is true that BP 22 is a criminal remedy while foreclosure of mortgage is a civil remedy. It is also true that BP 22 was not enacted to force, much more penalize a person

33

for his inability (or refusal to pay) his debt.17 What BP 22 prohibits and penalizes is the issuance of bum checks because of its pernicious effects on public interest. Congress, in the exercise of police power, enacted BP 22 in order to maintain public confidence in commercial transactions.18 At the other end of the spectrum, however, is the fact that a creditors principal purpose in suing the debtor for BP 22 is to be able to collect his debt. (Circular 57-97 and Section 1(b), Rule 111 of the Rules of Court have been drawn up to address this reality.) It is not so much that the debtor should be imprisoned for issuing a bad check; this is so specially because a conviction for BP 22 does not necessarily result in imprisonment. 19 Thus, we state the rule at present. If the debtor fails (or unjustly refuses) to pay his debt when it falls due and the debt is secured by a mortgage and by a check, the creditor has three options against the debtor and the exercise of one will bar the exercise of the others. He may pursue either of the three but not all or a combination of them. First, the creditor may file a collection suit against the debtor. This will open up all the properties of the debtor to attachment and execution, even the mortgaged property itself. Second, the creditor may opt to foreclose on the mortgaged property. In case the debt is not fully satisfied, he may sue the debtor for deficiency judgment (not a collection case for the whole indebtedness), in which case, all the properties of the debtor, other than the mortgaged property, are again opened up for the satisfaction of the deficiency.20 Lastly, the creditor may opt to sue the debtor for violation of BP 22 if the checks securing the obligation bounce. Circular 57-97 and Section 1(b), Rule 111 of the Rules of Court both provide that the criminal action for violation of BP 22 shall be deemed to necessarily include the corresponding civil action, i.e., a collection suit. No reservation to file such civil action separately shall be allowed or recognized. Petitioners would have been correct had it not been for the reasons stated earlier. WHEREFORE, the petition is hereby DENIED. Costs against petitioners. SO ORDERED. G.R. No. 169711 February 8, 2010

HEIRS OF SARAH MARIE PALMA BURGOS, Petitioners, vs. COURT OF APPEALS and JOHNNY CO y YU, Respondents. DECISION ABAD, J.: This case is about the legal standing of the offended parties in a criminal case to seek, in their personal capacities and without the Solicitor Generals intervention, reversal of the trial courts order granting bail to the accused on the ground of absence of strong evidence of guilt. The Facts and the Case On January 7, 1992 a number of assailants attacked the household of Sarah Marie Palma Burgos while all were asleep, killing Sarah and her uncle Erasmo Palma (Erasmo). Another uncle, Victor Palma (Victor), and a friend, Benigno Oquendo (Oquendo), survived the attack. The theory of the police was that a land transaction gone sour between Sarahs live-in partner, David So (David), and respondent Johnny Co (Co) motivated the assault. Four months after the incident, the police arrested Cresencio Aman (Aman) and Romeo Martin (Martin) who executed confessions, allegedly admitting their part in the attack. They pointed to two others who helped them, namely, Artemio "Pong" Bergonia and Danilo Say, and to respondent Co who allegedly masterminded the whole thing. The Regional Trial Court (RTC) of Manila, Branch 51, tried the case against Aman and Martin in Criminal Cases 92-104918-21. The three others remained at large. After trial, the RTC acquitted them both. After 10 years or on September 5, 2002 respondent Co surrendered to the National Bureau of Investigation. The prosecution charged him with two counts of murder for the deaths of Sarah1 and Erasmo2 and two counts of frustrated murder committed against Oquendo3 and Victor.4 Upon arraignment, Co pleaded not guilty to the charges. On September 25, 2002 respondent Co filed a petition for admission to bail.5 After hearing or on April 14, 2004, the RTC6 granted bail on the ground that the evidence of guilt of respondent Co was not strong. The RTC summarized the prosecutions evidence as follows:

34

1. Aman and Martins extrajudicial confessions that pointed to Co as the one who hired them to kill David and his family. 2. Davids testimony as alleged witness to the killing of Sarah. Aman supposedly told David later when they met that it was Co who ordered the massacre. 3. Police officer Leopoldo Vasquez, assistant leader of the police team that investigated the case, said that his team conducted two operations to take Co into custody. The first was in a restaurant where they waited for him. But Co got suspicious and when he saw the police, he immediately left the restaurant, got into his car, and sped away. The police also tried to arrest Co at his residence but the police did not find him there. Co also offered to settle the case. The RTC had a low estimate, however, of the above evidence. First, the extrajudicial confessions of Aman and Martin, apart from having been irregularly executed, merely proved their participation in the killing. Neither, however, claimed conspiracy with respondent Co. Further, the prosecution did not present Aman or Martin during the bail hearing, reportedly because Aman was already dead and Martin could not be located. To admit their sworn statements in evidence would deprive Co of his constitutional right to cross-examine them. Second, Davids narrations were, to the RTC, contradictory, uncorroborated, and self-serving, thus lacking in evidentiary weight. Third, police officer Vasquezs story was likewise uncorroborated. Besides, while flight is often indicative of guilt, it requires a clear showing of the identity of the offender and his evasion of arrest. Here, said the RTC, the prosecution failed to establish Cos identity as the assailant and his reason for fleeing from the police. Fourth, the prosecution failed to prove that the offer of settlement came from Co. Petitioner heirs of Sarah moved for reconsideration7 but the RTC, now presided over by another judge,8 denied the same in its Order of May 18, 2005.9 This prompted the victims heirs to file a special civil action of certiorari with prayer for a temporary restraining order or preliminary injunction10 before the Court of Appeals (CA) in CA-G.R. SP 90028.

The CA dismissed the petition, 11 however, for having been filed without involving the Office of the Solicitor General (OSG), in violation of jurisprudence12 and the law, specifically, Section 35, Chapter 12, Title III, Book IV of the Administrative Code which states that: Sec. 35. Powers and Functions.The Office of the Solicitor General shall represent the Government of the Philippines, its agencies and instrumentalities and its officials and agents in any litigation, proceedings, investigation or matter requiring the services of lawyers. When authorized by the President or head of the office concerned, it shall also represent governmentowned or controlled corporations. The Office of the Solicitor General shall constitute the law office of the Government and, as such, shall discharge duties requiring the services of lawyers. It shall have the following specific powers and functions: xxxx (1) Represent the Government in the Supreme Court and the Court of Appeals in all criminal proceedings; represent the Government and its officers in the Supreme Court, Court of Appeals, and all other courts or tribunals in all civil actions and special proceedings in which the Government or any officer thereof in his official capacity is a party. Petitioner heirs of Sarah moved for reconsideration13 but the CA denied it for lack of merit in its Resolution of September 16, 2005,14 hence, the heirs recourse to this Court. The Issue The case raises one issue: whether or not the CA correctly dismissed the special civil action of certiorari, which questioned the RTCs grant of bail to respondent Co, for having been filed in the name of the offended parties and without the OSGs intervention.

The Courts Ruling Generally, a criminal case has two aspects, the civil and the criminal. The civil aspect is borne of the principle that every person criminally liable is also civilly liable.15 The civil action, in which the offended party is the plaintiff and the accused is the

35

defendant,16 is deemed instituted with the criminal action unless the offended party waives the civil action or reserves the right to institute it separately or institutes the civil action prior to the criminal action.17 The law allows the merger of the criminal and the civil actions to avoid multiplicity of suits.18 Thus, when the state succeeds in prosecuting the offense, the offended party benefits from such result and is able to collect the damages awarded to him. But, when the trial court acquits the accused19 or dismisses the case20 on the ground of lack of evidence to prove the guilt of the accused beyond reasonable doubt, the civil action is not automatically extinguished since liability under such an action can be determined based on mere preponderance of evidence. The offended party may peel off from the terminated criminal action and appeal from the implied dismissal of his claim for civil liability. 21 The purpose of a criminal action, in its purest sense, is to determine the penal liability of the accused for having outraged the state with his crime and, if he be found guilty, to punish him for it. In this sense, the parties to the action are the People of the Philippines and the accused.22 The offended party is regarded merely as a witness for the state. 23 Also in this wise, only the state, through its appellate counsel, the OSG,24 has the sole right and authority to institute proceedings before the CA or the Supreme Court.251avvphi1 As a general rule, the mandate or authority to represent the state lies only in the OSG. Thus It is patent that the intent of the lawmaker was to give the designated official, the Solicitor General, in this case, the unequivocal mandate to appear for the government in legal proceedings. Spread out in the laws creating the office is the discernible intent which may be gathered from the term "shall" x x x. xxxx The Court is firmly convinced that considering the spirit and the letter of the law, there can be no other logical interpretation of Sec. 35 of the Administrative Code than that it is, indeed, mandatory upon the OSG to "represent the Government of the Philippines, its agencies and instrumentalities and its officials and agents in any litigation, proceeding,

investigation or matter services of a lawyer.26

requiring

the

For the above reason, actions essentially involving the interest of the state, if not initiated by the Solicitor General, are, as a rule,27 summarily dismissed.28 Here, the question of granting bail to the accused is but an aspect of the criminal action, preventing him from eluding punishment in the event of conviction. The grant of bail or its denial has no impact on the civil liability of the accused that depends on conviction by final judgment. Here, respondent Co has already been arraigned. Trial and judgment, with award for civil liability when warranted, could proceed even in his absence. In Narciso v. Sta. Romana-Cruz,29 this Court allowed the offended party to challenge before it the trial courts order granting bail. But in that case, the trial court gravely abused its discretion amounting to lack of jurisdiction in granting bail without conducting any hearing at all. Thus, to disallow the appeal on the basis of lack of intervention of the OSG would "leave the private complainant without any recourse to rectify the public injustice."30 It is not the case here. The trial court took time to hear the parade of witnesses that the prosecution presented before reaching the conclusion that the evidence of guilt of respondent Co was not strong. WHEREFORE, the Court DENIES the petition and AFFIRMS the Court of Appeals Decision in CAG.R. SP 90028 dated June 29, 2005 and its Resolution dated September 16, 2005. SO ORDERED. G.R. No. 133347 April 23, 2010

ABS-CBN BROADCASTING CORPORATION, EUGENIO LOPEZ, JR., AUGUSTO ALMEDALOPEZ, and OSCAR M. LOPEZ, Petitioners, vs. OFFICE OF THE OMBUDSMAN, ROBERTO S. BENEDICTO, EXEQUIEL B. GARCIA, MIGUEL V. GONZALES, and SALVADOR (BUDDY) TAN, Respondents. RESOLUTION NACHURA, J.: Before us is a Motion for Reconsideration filed by petitioners Eugenio, Jr., Oscar and Augusto Almeda, all surnamed Lopez, in their capacity

36

as officers and on behalf of petitioner ABS-CBN Broadcasting Corporation (ABS-CBN), of our Decision in G.R. No. 133347, dismissing their petition for certiorari because of the absence of grave abuse of discretion in the Ombudsman Resolution which, in turn, found no probable cause to indict respondents for the following violations of the Revised Penal Code (RPC): (1) Article 298 Execution of Deeds by Means of Violence or Intimidation; (2) Article 315, paragraphs 1[b], 2[a], and 3[a] Estafa; (3) Article 308 Theft; (4) Article 302 Robbery; (5) Article 312 Occupation of Real Property or Usurpation of Real Rights in Property; and (6) Article 318 Other Deceits. The assailed Decision disposed of the case on two (2) points: (1) the dropping of respondents Roberto S. Benedicto and Salvador (Buddy) Tan as respondents in this case due to their death, consistent with our rulings in People v. Bayotas1 and Benedicto v. Court of Appeals;2 and (2) our finding that the Ombudsman did not commit grave abuse of discretion in dismissing petitioners criminal complaint against respondents. Undaunted, petitioners ask for a reconsideration of our Decision on the following grounds: I. WITH DUE RESPECT, THE EXECUTION AND VALIDITY OF THE LETTER-AGREEMENT DATED 8 JUNE 1973 ARE PLAINLY IRRELEVANT TO ASCERTAINING THE CRIMINAL LIABILITY OF THE RESPONDENTS AND, THEREFORE, THE ISSUE AS TO WHETHER SAID AGREEMENT WAS RATIFIED OR NOT IS IMMATERIAL IN THE PRESENT CASE. II. WITH DUE RESPECT, RESPONDENTS BENEDICTO AND TAN SHOULD NOT BE DROPPED AS RESPONDENTS SIMPLY BECAUSE THEY MET THEIR UNTIMELY DEMISE DURING THE PENDENCY OF THE CASE.3 Before anything else, we note that petitioners filed a Motion to Refer the Case to the Court en banc.4 Petitioners aver that the arguments contained in their Motion for Reconsideration, such as: (1) the irrelevance of the civil law concept of ratification in determining whether a crime was committed; and (2) the continuation of the criminal complaints against respondents Benedicto and Tan who have both died, to prosecute their possible civil liability therefor, present novel questions of law warranting resolution by the Court en banc.

In the main, petitioners argue that the Decision is contrary to law because: (1) the ratification of the June 8, 1973 letter-agreement is immaterial to the determination of respondents criminal liability for the aforestated felonies in the RPC; and (2) the very case cited in our Decision, i.e. People v. Bayotas,5 allows for the continuation of a criminal case to prosecute civil liability based on law and is independent of the civil liability arising from the crime. We disagree with petitioners. The grounds relied upon by petitioners in both motions, being intertwined, shall be discussed jointly. Before we do so, parenthetically, the counsel for respondent Miguel V. Gonzales belatedly informed this Court of his clients demise on July 20, 2007.6 Hence, as to Gonzales, the case must also be dismissed.1avvphi1 Contrary to petitioners assertion, their motion for reconsideration does not contain a novel question of law as would merit the attention of this Court sitting en banc. We also find no cogent reason to reconsider our Decision. First and foremost, there is, as yet, no criminal case against respondents, whether against those who are living or those otherwise dead. The question posed by petitioners on this longsettled procedural issue does not constitute a novel question of law. Nowhere in People v. Bayotas7 does it state that a criminal complaint may continue and be prosecuted as an independent civil action. In fact, Bayotas, once and for all, harmonized the rules on the extinguished and on the subsisting liabilities of an accused who dies. We definitively ruled: From this lengthy disquisition, we summarize our ruling herein: 1. Death of an accused pending appeal of his conviction extinguishes his criminal liability as well as the civil liability based solely thereon. As opined by Justice Regalado, in this regard, "the death of the accused prior to final judgment terminates his criminal liability and only the civil liability directly arising from and based solely on the offense committed, i.e., civil liability ex delicto in senso strictiore." 2. Corollarily, the claim for civil liability survives notwithstanding the death of accused, if the same may also be predicated on a source of obligation other than delict. Article 1157 of the Civil Code enumerates these other sources of

37

obligation from which the civil liability may arise as a result of the same act or omission: a) Law b) Contracts c) Quasi-contracts d) xxx xxx xxx e) Quasi-delicts 3. Where the civil liability survives, as explained in Number 2 above, an action for recovery thereof may be pursued but only by filing a separate civil action and subject to Section 1, Rule 111 of the 1985 Rules on Criminal Procedure as amended. This separate civil action may be enforced either against the executor/administrator or the estate of the accused, depending on the source of obligation upon which the same is based as explained above. 4. Finally, the private offended party need not fear a forfeiture of his right to file this separate civil action by prescription, in cases where during the prosecution of the criminal action and prior to its extinction, the private offended party instituted together therewith the civil action. In such case, the statute of limitations on the civil liability is deemed interrupted during the pendency of the criminal case, conformably with provisions of Article 1155 of the Civil Code, that should thereby avoid any apprehension on a possible [de]privation of right by prescription. From the foregoing, it is quite apparent that Benedicto, Tan, and Gonzales, who all died during the pendency of this case, should be dropped as party respondents. If on this score alone, our ruling does not warrant reconsideration. We need not even delve into the explicit declaration in Benedicto v. Court of Appeals.8 Second, and more importantly, we dismissed the petition for certiorari filed by petitioners because they failed to show grave abuse of discretion on the part of the Ombudsman when he dismissed petitioners criminal complaint against respondents for lack of probable cause. We reiterate that our inquiry was limited to a determination of whether the Ombudsman

committed grave abuse of discretion when he found no probable cause to indict respondents for various felonies under the RPC. The invocation of our certiorari jurisdiction over the act of a constitutional officer, such as the Ombudsman, must adhere to the strict requirements provided in the Rules of Court and in jurisprudence. The determination of whether there was grave abuse of discretion does not, in any way, constitute a novel question of law. We first pointed out in our Decision that the complaint-affidavits of petitioners, apart from a blanket charge that remaining respondents, Gonzales (who we thought was alive at that time) and Exequiel Garcia, are officers of KBS/RPN and/or alter egos of Benedicto, are bereft of sufficient ground to engender a wellfounded belief that crimes have been committed and that respondents, namely, Gonzales and Garcia, are probably guilty thereof and should be held for trial. Certainly, no grave abuse of discretion can be imputed to the Ombudsman that would warrant a reversal of his Resolution. The charges of individual petitioners Eugenio, Jr., Oscar and Augusto Almeda against respondents, Gonzales and Garcia, contained in their respective complaint-affidavits simply consisted of the following: 1. Complaint-affidavit of Eugenio, Jr. 32.1. I was briefed that Senator Estanislao Fernandez in representation of Benedicto, met with Senator Taada at the Club Filipino in June 1976. Discussions were had on how to arrive at the "reasonable rental" for the use of ABS-CBN stations and facilities. A second meeting at Club Filipino took place on July 7, 1976 between Senators Taada and Fernandez, who brought along Atty. Miguel Gonzales, a close associate and lawyer of Benedicto and an officer of KBS. xxxx 38.2. The illegal takeover of ABS-CBN stations, studios and facilities, and the loss and/or damages caused to our assets occurred while Benedicto, Exequiel Garcia, Miguel Gonzales, and Salvador Tan were in possession, control and management of our network. Roberto S. Benedicto was the Chairman of the Board of KBS-RPN and its Chief Executive Officer (CEO), to whom most of the KBS-RPN officers reported while he was in Metro Manila. Miguel Gonzales, the Vice-President of KBS, and Exequiel Garcia, the Treasurer, were the alter egos of Benedicto whenever the latter was out of the country; x x x.9

38

2. Complaint-affidavit of Oscar 25. All the illegal activities as complained of above, were done upon the orders, instructions and directives of Roberto S. Benedicto, the Chairman of the Board and Chief Executive Officer of the KBS/RPN group; Miguel Gonzales and Exequiel Garcia, close colleagues and business partners of Benedicto who were either directors/officers KBS/RPN and who acted as Benedictos alter egos whenever the latter was out of the country; x x x. xxxx 38. Senator Estanislao Fernandez, in representation of Benedicto, met with Senator Taada at the Club Filipino on June 1976. Discussions were had on how to arrive at the "reasonable rental" for the use of ABS stations and facilities. A second meeting at Club Filipino took place on July 7, 1976 between Senators Taada and Fernandez, who brought along Atty. Mike Gonzales, a close associate and friend of Benedicto and an officer of KBS.10 3. Complaint-affidavit of Augusto Almeda 21.1. Barely two weeks from their entry into the ABS Broadcast Center, KBS personnel started making unauthorized withdrawals from the ABS Stock Room. All these withdrawals of supplies and equipment were made under the orders of Benedicto, Miguel Gonzales, Exequiel Garcia, and Salvador Tan, the Chairman, the VicePresident, Treasurer, and the General Manager of KBS, respectively. No payment was ever made by either Benedicto or KBS for all the supplies and equipment withdrawn from the ABS Broadcast Center. xxxx 31. Senator Estanislao Fernandez, in representation of Benedicto, met with Senator Taada at the Club Filipino on June 1976. Discussions were had on how to arrive at the "reasonable rental" for the use of ABS stations and facilities. A second meeting at Club Filipino took place on July 7, 1976 between Senators Taada and Fernandez, who brought along Atty. Mike Gonzales, a close associate and friend of Benedicto and an officer of KBS.11 From the foregoing, it is beyond cavil that there is no reason for us to depart from our policy of non-interference with the Ombudsmans finding of probable cause or lack thereof. On the strength of these allegations, we simply could not find any rational basis to impute grave

abuse of discretion to the Ombudsmans dismissal of the criminal complaints. Third, we did not state in the Decision that ratification extinguishes criminal liability. We simply applied ratification in determining the conflicting claims of petitioners regarding the execution of the letter-agreement. Petitioners, desperate to attach criminal liability to respondents acts, specifically to respondent Benedicto, alleged in their complaint-affidavits that Benedicto forced, coerced and intimidated petitioners into signing the letter-agreement. In other words, petitioners disown this letteragreement that they were supposedly forced into signing, such that this resulted in a violation of Article 298 of the RPC (Execution of Deeds by means of Violence or Intimidation). However, three elements must concur in order for an offender to be held liable under Article 298: (1) that the offender has intent to defraud another. (2) that the offender compels him to sign, execute, or deliver any public instrument or document. (3) that the compulsion is by means of violence or intimidation.12 The element of intent to defraud is not present because, even if, initially, as claimed by petitioners, they were forced to sign the letteragreement, petitioners made claims based thereon and invoked the provisions thereof. In fact, petitioners wanted respondents to honor the letter-agreement and to pay rentals for the use of the ABS-CBN facilities. By doing so, petitioners effectively, although they were careful not to articulate this fact, affirmed their signatures in this letter-agreement. True, ratification is primarily a principle in our civil law on contracts. Yet, their subsequent acts in negotiating for the rentals of the facilities which translate into ratification of the letteragreement cannot be disregarded simply because ratification is a civil law concept. The claims of petitioners must be consistent and must, singularly, demonstrate respondents culpability for the crimes they are charged with. Sadly, petitioners failed in this regard because, to reiterate, they effectively ratified and advanced the validity of this letter-agreement in their claim against the estate of Benedicto. Finally, we take note of the conflicting claim of petitioners by filing a separate civil action to

39

enforce a claim against the estate of respondent Benedicto. Petitioners do not even specifically deny this fact and simply sidestep this issue which was squarely raised in the Decision. The Rules of Court has separate provisions for different claims against the estate of a decedent under Section 5 of Rule 86 and Section 1 of Rule 87: RULE 86. SECTION 5. Claims which must be filed under the notice. If not filed, barred; exceptions. All claims for money against the decedent, arising from contract, express or implied, whether the same be due, not due, or contingent, all claims for funeral expenses and expenses for the last sickness of the decedent, and judgment for money against the decedent, must be filed within the time limited in the notice; otherwise they are barred forever, except that they may be set forth as counter claims in any action that the executor or administrator may bring against the claimants. Xxx Claims not yet due, or contingent, may be approved at their present value. RULE 87. SECTION 1. Actions which may and which may not be brought against executor or administrator. No action upon a claim for the recovery of money or debt or interest thereon shall be commenced against the executor or administrator; but actions to recover real or personal property, or an interest therein, from the estate, or to enforce a lien thereon, and actions to recover damages for an injury to person or property, real or personal, may be commenced against him. If, as insisted by petitioners, respondents committed felonies in forcing them to sign the letter-agreement, petitioners should have filed an action against the executor or administrator of Benedictos estate based on Section 1, Rule 87 of the Rules of Court. But they did not. Instead they filed a claim against the estate based on contract, the unambiguous letteragreement, under Section 5, Rule 86 of the Rules of Court. The existence of this claim against the estate of Benedicto as opposed to the filing of an action against the executor or administrator of Benedictos estate forecloses all issues on the circumstances surrounding the execution of this letter- agreement. We are not oblivious of the fact that, in the milieu prevailing during the Marcos years, incidences involving intimidation of businessmen were not uncommon. Neither are

we totally unaware of the reputed closeness of Benedicto to President Marcos. However, given the foregoing options open to them under the Rules of Court, petitioners choice of remedies by filing their claim under Section 5, Rule 86 after Marcos had already been ousted and full democratic space restored works against their contention, challenging the validity of the letter-agreement. Now, petitioners must live with the consequences of their choice. WHEREFORE, in light of the foregoing, the Motion to Refer the Case to the Court en banc and the Motion for Reconsideration are DENIED. SO ORDERED. G.R. No. 165496 February 12, 2007

HUN HYUNG PARK, Petitioner, vs. EUNG WON CHOI, Respondent. DECISION CARPIO MORALES, J.: Petitioner, Hun Hyung Park, assails the Court of Appeals (CA) Resolutions dated May 20, 20041 and September 28, 20042 in CA G.R. CR No. 28344 dismissing his petition and denying reconsideration thereof, respectively. In an Information3 dated August 31, 2000, respondent, Eung Won Choi, was charged for violation of Batas Pambansa Blg. 22, otherwise known as the Bouncing Checks Law, for issuing on June 28, 1999 Philippine National Bank Check No. 0077133 postdated August 28, 1999 in the amount of P1,875,000 which was dishonored for having been drawn against insufficient funds. Upon arraignment, respondent, with the assistance of counsel, pleaded "not guilty" to the offense charged. Following the pre-trial conference, the prosecution presented its evidence-in-chief. After the prosecution rested its case, respondent filed a Motion for Leave of Court to File Demurrer to Evidence to which he attached his Demurrer, asserting that the prosecution failed to prove that he received the notice of dishonor, hence, the presumption of the element of knowledge of insufficiency of funds did not arise.4 By Order5 of February 27, 2003, the Metropolitan Trial Court (MeTC) of Makati,

40

Branch 65 granted the Demurrer and dismissed the case. The prosecutions Motion for Reconsideration was denied.6 Petitioner appealed the civil aspect7 of the case to the Regional Trial Court (RTC) of Makati, contending that the dismissal of the criminal case should not include its civil aspect. By Decision of September 11, 2003, Branch 60 of the RTC held that while the evidence presented was insufficient to prove respondents criminal liability, it did not altogether extinguish his civil liability. It accordingly granted the appeal of petitioner and ordered respondent to pay him the amount of P1,875,000 with legal interest.8 Upon respondents motion for reconsideration, however, the RTC set aside its decision and ordered the remand of the case to the MeTC "for further proceedings, so that the defendant [-respondent herein] may adduce evidence on the civil aspect of the case."9 Petitioners motion for reconsideration of the remand of the case having been denied, he elevated the case to the CA which, by the assailed resolutions, dismissed his petition for the following reasons: 1. The verification and certification of non-forum shopping attached to the petition does not fully comply with Section 4, as amended by A.M. No. 00-210-SC, Rule 7, 1997 Rules of Court, because it does not give the assurance that the allegations of the petition are true and correct based on authentic records. 2. The petition is not accompanied by copies of certain pleadings and other material portions of the record, (i.e., motion for leave to file demurrer to evidence, demurrer to evidence and the opposition thereto, and the Municipal [sic] Trial Courts Order dismissing Criminal Case No. 294690) as would support the allegations of the petition (Sec. 2, Rule 42, ibid.). 3. The Decision dated September 11, 2003 of the Regional Trial Court attached to the petition is an uncertified and illegible mere machine copy of the original (Sec. 2, Rule 42, ibid.). 4. Petitioners failed to implead the People of the Philippines as partyrespondent in the petition.10

In his present petition, petitioner assails the above-stated reasons of the appellate court in dismissing his petition. The manner of verification for pleadings which are required to be verified, such as a petition for review before the CA of an appellate judgment of the RTC,11 is prescribed by Section 4 of Rule 7 of the Rules of Court: Sec. 4. Verification. Except when otherwise specifically required by 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 the pleading and that the allegations therein are true and correct of his personal knowledge or based on authentic records. A pleading required to be verified which contains a verification based on "information and belief," or upon "knowledge, information and belief," or lacks a proper verification shall be treated as an unsigned pleading. 12(Emphasis and underscoring supplied) Petitioner argues that the word "or" is a disjunctive term signifying disassociation and independence, hence, he chose to affirm in his petition he filed before the court a quo that its contents are "true and correct of my own personal knowledge,"13 and not on the basis of authentic documents. On the other hand, respondent counters that the word "or" may be interpreted in a conjunctive sense and construed to mean as "and," or vice versa, when the context of the law so warrants. A reading of the above-quoted Section 4 of Rule 7 indicates that a pleading may be verified under either of the two given modes or under both. The veracity of the allegations in a pleading may be affirmed based on either ones own personal knowledge or on authentic records, or both, as warranted. The use of the preposition "or" connotes that either source qualifies as a sufficient basis for verification and, needless to state, the concurrence of both sources is more than sufficient.14 Bearing both a disjunctive and conjunctive sense, this parallel legal signification avoids a construction that will exclude the combination of the alternatives or bar the efficacy of any one of the alternatives standing alone.15 Contrary to petitioners position, the range of permutation is not left to the pleaders liking,

41

but is dependent on thesurrounding nature of the allegations which may warrant that a verification be based either purely on personal knowledge, or entirely on authentic records, or on both sources. As pointed out by respondent, "authentic records" as a basis for verification bear significance in petitions wherein the greater portions of the allegations are based on the records of the proceedings in the court of origin and/or the court a quo, and not solely on the personal knowledge of the petitioner. To illustrate, petitioner himself could not have affirmed, based on his personal knowledge, the truthfulness of the statement in his petition16 before the CA that at the pre-trial conference respondent admitted having received the letter of demand, because he (petitioner) was not present during the conference.17 Hence, petitioner needed to rely on the records to confirm its veracity. Verification is not an empty ritual or a meaningless formality. Its import must never be sacrificed in the name of mere expedience or sheer caprice. For what is at stake is the matter of verity attested by the sanctity of an oath18to secure an assurance that the allegations in the pleading have been made in good faith, or are true and correct and not merely speculative.19 This Court has strictly been enforcing the requirement of verification and certification and enunciating that obedience to the requirements of procedural rules is needed if fair results are to be expected therefrom. Utter disregard of the rules cannot just be rationalized by harking on the policy of liberal construction. 20 While the requirement is not jurisdictional in nature, it does not make it less a rule. A relaxed application of the rule can only be justified by the attending circumstances of the case.21 To sustain petitioners explanation that the basis of verification is a matter of simple preference would trivialize the rationale and diminish the resoluteness of the rule. It would play on predilection and pay no heed in providing enough assurance of the correctness of the allegations. On the second reason of the CA in dismissing the petition that the petition was not accompanied by copies of certain pleadings and other material portions of the record as would support the allegations of the petition (i.e., Motion for Leave to File Demurrer to Evidence, Demurrer to Evidence and the Opposition thereto, and the MeTC February 27, 2003 Order

dismissing the case) petitioner contends that these documents are immaterial to his appeal. Contrary to petitioners contention, however, the materiality of those documents is very apparent since the civil aspect of the case, from which he is appealing, was likewise dismissed by the trial court on account of the same Demurrer. Petitioner, nonetheless, posits that he subsequently submitted to the CA copies of the enumerated documents, save for the MeTC February 27, 2003 Order, as attachments to his Motion for Reconsideration. The Rules, however, require that the petition must "be accompanied by clearly legible duplicate original or true copies of the judgments or final orders of both lower courts, certified correct by the clerk of court."22 A perusal of the petition filed before the CA shows that the only duplicate original or certified true copies attached as annexes thereto are the January 14, 2004 RTC Order granting respondents Motion for Reconsideration and the March 29, 2004 RTC Order denying petitioners Motion for Reconsideration. The copy of the September 11, 2003 RTC Decision, which petitioner prayed to be reinstated, is not a certified true copy and is not even legible. Petitioner later recompensed though by appending to his Motion for Reconsideration a duplicate original copy. While petitioner averred before the CA in his Motion for Reconsideration that the February 27, 2003 MeTC Order was already attached to his petition as Annex "G," Annex "G" bares a replicate copy of a different order, however. It was to this Court that petitioner belatedly submitted an uncertified true copy of the said MeTC Order as an annex to his Reply to respondents Comment. This Court in fact observes that the copy of the other MeTC Order, that dated May 5, 2003, which petitioner attached to his petition before the CA is similarly uncertified as true. Since both Orders of the MeTC were adverse to him even with respect to the civil aspect of the case, petitioner was mandated to submit them in the required form.23 In fine, petitioner fell short in his compliance with Section 2 (d) of Rule 42, the mandatory tenor of which is discernible thereunder and is well settled.24 He has not, however, advanced any strong compelling

42

reasons to warrant a relaxation of the Rules, hence, his petition before the CA was correctly dismissed. Procedural rules are tools designed to facilitate the adjudication of cases. Courts and litigants alike are thus enjoined to abide strictly by the rules. And while the Court, in some instances, allows a relaxation in the application of the rules, this we stress, was never intended to forge a bastion for erring litigants to violate the rules with impunity. The liberality in the interpretation and application of the rules applies only in proper cases and under justifiable causes and circumstances. While it is true that litigation is not a game of technicalities, it is equally true that every case must be prosecuted in accordance with the prescribed procedure to insure an orderly and speedy administration of justice.25 (Emphasis supplied) As to the third reason for the appellate courts dismissal of his petition failure to implead the People of the Philippines as a party in the petition indeed, as petitioner contends, the same is of no moment, he having appealed only the civil aspect of the case. Passing on the dual purpose of a criminal action, this Court ruled: Unless the offended party waives the civil action or reserves the right to institute it separately or institutes the civil action prior to the criminal action, there are two actions involved in a criminal case. The first is the criminal action for the punishment of the offender. The parties are the People of the Philippines as the plaintiff and the accused. In a criminal action, the private complainant is merely a witness for the State on the criminal aspect of the action.The second is the civil action arising from the delict. The private complainant is the plaintiff and the accused is the defendant. There is a merger of the trial of the two cases to avoid multiplicity of suits.26 (Underscoring supplied) It bears recalling that the MeTC acquitted respondent.27 As a rule, a judgment of acquittal is immediately final and executory and the prosecution cannot appeal the acquittal because of the constitutional prohibition against double jeopardy. Either the offended party or the accused may, however, appeal the civil aspect of the judgment despite the acquittal of the accused. The public prosecutor has generally no interest in appealing the civil aspect of a decision acquitting the accused. The acquittal ends his work. The case is terminated as far as he is

concerned. The real parties in interest in the civil aspect of a decision are the offended party and the accused.28 Technicality aside, the petition is devoid of merit. When a demurrer to evidence is filed without leave of court, the whole case is submitted for judgment on the basis of the evidence for the prosecution as the accused is deemed to have waived the right to present evidence.29 At that juncture, the court is called upon to decide the case including its civil aspect, unless the enforcement of the civil liability by a separate civil action has been waived or reserved. 30 If the filing of a separate civil action has not been reserved or priorly instituted or the enforcement of civil liability is not waived, the trial court should, in case of conviction, state the civil liability or damages caused by the wrongful act or omission to be recovered from the accused by the offended party, if there is any.31 For, in case of acquittal, the accused may still be adjudged civilly liable. The extinction of the penal action does not carry with it the extinction of the civil action where (a) the acquittal is based on reasonable doubt as only preponderance of evidence is required; (b) the court declares that the liability of the accused is only civil; and (c) the civil liability of the accused does not arise from or is not based upon the crime of which the accused was acquitted.32 The civil action based on delict may, however, be deemed extinguished if there is a finding on the final judgment in the criminal action that the act or omission from which the civil liability may arise did not exist.33 In case of a demurrer to evidence filed with leave of court, the accused may adduce countervailing evidence if the court denies the demurrer.34 Such denial bears no distinction as to the two aspects of the case because there is a disparity of evidentiary value between the quanta of evidence in such aspects of the case. In other words, a court may not deny the demurrer as to the criminal aspect and at the same time grant the demurrer as to the civil aspect, for if the evidence so far presented is not insufficient to prove the crime beyond reasonable doubt, then the same evidence is likewise not insufficient to establish civil liability by mere preponderance of evidence.

43

On the other hand, if the evidence so far presented is insufficient as proof beyond reasonable doubt, it does not follow that the same evidence is insufficient to establish a preponderance of evidence. For if the court grants the demurrer, proceedings on the civil aspect of the case generally proceeds. The only recognized instance when an acquittal on demurrer carries with it the dismissal of the civil aspect is when there is a finding that the act or omission from which the civil liability may arise did not exist. Absent such determination, trial as to the civil aspect of the case must perforce continue. Thus this Court, in Salazar v. People,35 held: If demurrer is granted and the accused is acquitted by the court, the accused has the right to adduce evidence on the civil aspect of the case unless the court also declares that the act or omission from which the civil liability may arise did not exist.36 In the instant case, the MeTC granted the demurrer and dismissed the case without any finding that the act or omission from which the civil liability may arise did not exist. Respondent did not assail the RTC order of remand. He thereby recognized that there is basis for a remand. Indicatively, respondent stands by his defense that he merely borrowed P1,500,000 with the remainder representing the interest, and that he already made a partial payment of P1,590,000. Petitioner counters, however, that the payments made by respondent pertained to other transactions.37 Given these conflicting claims which are factual, a remand of the case would afford the fullest opportunity for the parties to ventilate, and for the trial court to resolve the same. Petitioner finally posits that respondent waived his right to present evidence on the civil aspect of the case (1) when the grant of the demurrer was reversed on appeal, citing Section 1 of Rule 33,38 and (2) when respondent orally opposed petitioners motion for reconsideration pleading that proceedings with respect to the civil aspect of the case continue. Petitioners position is tenuous. Petitioners citation of Section 1 of Rule 33 is incorrect.1awphi1.net Where a court has jurisdiction over the subject matter and over the person of the accused, and the crime was committed within its territorial jurisdiction, the

court necessarily exercises jurisdiction over all issues that the law requires it to resolve. One of the issues in a criminal case being the civil liability of the accused arising from the crime, the governing law is the Rules of Criminal Procedure, not the Rules of Civil Procedure which pertains to a civil action arising from the initiatory pleading that gives rise to the suit.39 As for petitioners attribution of waiver to respondent, it cannot be determined with certainty from the records the nature of the alleged oral objections of respondent to petitioners motion for reconsideration of the grant of the demurrer to evidence. Any waiver of the right to present evidence must be positively demonstrated. Any ambiguity in the voluntariness of the waiver is frowned upon,40 hence, courts must indulge every reasonable presumption against it.41 This Court therefore upholds respondents right to present evidence as reserved by his filing of leave of court to file the demurrer. WHEREFORE, the petition is, in light of the foregoing discussions, DENIED. The case is REMANDED to the court of origin, Metropolitan Trial Court of Makati City, Branch 65 which is DIRECTED to forthwith set Criminal Case No. 294690 for further proceedings only for the purpose of receiving evidence on the civil aspect of the case. Costs against petitioner. SO ORDERED.

G.R. No. 169647

August 31, 2007

ANTONIO CHIENG, substituted by WILLIAM CHIENG, Petitioner, vs. Spouses EULOGIO and TERESITA SANTOS, Respondents. DECISION CHICO-NAZARIO, J.:

44

Before this Court is a Petition for Review on Certiorari under Rule 45 of the Rules of Court,1 praying that the Decision, dated 13 September 2005 of the Court of Appeals in CAG.R. CV No. 799712 be set aside and the Decision3 and Order4 of the Olongapo City Regional Trial Court (RTC), Branch 74, in Civil Case No. 239-0-93, dated 23 October 2001 and 11 January 2002, respectively, which were reversed by the appellate court, be reinstated. Stripped of the non-essentials, the facts are as follows: On 17 August 1989, petitioner Antonio Chieng5 extended a loan in favor of respondent spouses Eulogio and Teresita Santos. As security for such loan, the respondents executed in favor of petitioner a Deed of Real Estate Mortgage over a piece of land, consisting of 613 square meters, situated at West BajacBajac, Olongapo City, and covered by Transfer Certificate of Title (TCT) No. T-2570 issued by the Registry of Deeds of Olongapo City in the name of respondents. On even date, the Deed of Real Estate Mortgage was registered with the Registry of Deeds of Olongapo City and was duly annotated on TCT No. T-2570. Thereafter, respondent Eulogio issued several checks in favor of petitioner as payment for the loan. Some of these checks were dishonored, prompting the petitioner to file a criminal case against respondent Eulogio for violation of Batas Pambansa Blg. 22 before the Olongapo City RTC, Branch 72, docketed as Criminal Cases No. 612-90 to No. 615-90. During the pretrial conference of these cases, petitioner and respondent Eulogio entered into a compromise agreement, which was contained in the Order of the court, to wit: ORDER When this case was called for pre-trial conference in the presence of the Honorable Prosecutor, accused Eulogio Santos and private complainant Antonio Chieng came to an agreement that the total indebtedness of Mr. Santos as of today, July 15, 1991 amounts to Two Hundred Thousand (P200,000.00) Pesos including interest since the beginning and excluding those already paid for. It is understood that at a payment of P20,000.00 each month starting on or before July 31, 1991 and upon the completion of the amount of P200,000.00 without any interest, the indebtedness of Mr. Santos shall/have been discharged and upon payment of P20,000.00 on or before July 31 1991, the next payment on or

before August 31 1991, these cases will be considered terminated. Prosecutor Martinez, Accused Eulogio Santos and complainant Antonio Chieng are notified of this assignment.6 Respondent Eulogio failed to comply with his obligation in the compromise agreement. On 17 June 1993, petitioner filed with the Olongapo City RTC, Branch 74, an action for foreclosure of mortgage constituted on respondents real property docketed as Civil Case No. 239-0-93. Petitioner alleged that he extended a loan of P600,000.00 in favor of respondents for which respondents executed the Deed of Real Estate Mortgage dated 17 August 1987 in his favor. Despite his repeated demands, respondents failed to pay the loan. Respondents sought the dismissal of the case on the ground of lack of cause of action claiming that the Deed of Real Estate Mortgage did not reflect the parties true intention or agreement because the total amount of their indebtedness was only around P200,000.00, not P600,000.00 as stated in the Deed. Respondents and petitioner supposedly agreed to make it appear that respondents loan amounted to P600,000.00 to protect the latter from the claims of their other creditors who were trying to attach or levy their property. Respondents further averred that they had partly paid their loan but petitioner refused to issue them receipts and to render an accounting of their remaining obligation. On 10 February 1994, petitioner made his formal offer of evidence. Upon submission by respondents of their Comment/Objections to petitioners formal offer of evidence, the court issued an Order dated 1 September 1994, admitting petitioners offer of evidence, and set the hearing for the reception of respondents evidence on 28 September 1994. However, hearings were successively postponed upon the motions of respondents. On 14 January 1997, the court issued an Order declaring that (1) the respondents were deemed to have waived their right to present evidence; and (2) the case was considered submitted for decision. Respondents filed a Motion for Reconsideration of the said RTC Order dated 14 January 1997, but this was denied.7 On 9 July 1997, the Olongapo City RTC, Branch 74, rendered a Decision8 ordering the respondents to pay petitioner their loan obligation amounting to P600,000.00, plus interests and attorneys fees, thus:

45

WHEREFORE, judgment is hereby rendered ordering the [ herein respondents] to pay [herein petitioner] within 90 days from receipt of this Decision the sum of P600,000.00 with legal rate of interest of 12% per annum from August 13, 1992 until the amount is fully paid; to pay [petitioner] the amount of P60,000.00 as attorneys fees; and the costs of this suit. In default of such payment, the Sheriff of this Court is ordered to sell at public auction the property described in the Deed of Real Estate Mortgage x x x together with the improvements thereon and apply the proceeds thereof to the principal obligation, interests, attorneys fees and the costs of this suit. Respondents filed a Reconsideration9 arguing: Motion for

that the P200,000.00 which he was directed to pay petitioner by the Olongapo City RTC, Branch 72 in its Order dated 15 July 1991 in Criminal Cases No. 612-90 to No. 615-90 was the same subject of Civil Case No. 239-0-93 pending with the Olongapo City RTC, Branch 74. On 23 September 1998, petitioner passed away.11 Thereafter, his heirs filed a motion to substitute him in Civil Case No. 239-0-93. 12 In its Order dated 12 January 1999, the Olongapo City RTC, Branch 74 granted the motion and directed the substitution of petitioner by his son, William Chieng.13 On 23 October 2001, the Olongapo City RTC, Branch 74 rendered a Decision in Civil Case No. 239-0-93 directing the respondents to pay petitioner the amount of P377,000.00 with interest, plus attorneys fees and costs. 14 The decretal portion of the decision reads: WHEREFORE, finding [herein respondents] Eulogio Santos and Teresita Santos liable to [herein petitioner] Antonio Chieng (substituted herein by William Cheng) in the sum of P377,000,00 including interest; - judgment is hereby rendered directing Eulogio Santos and Teresita Santos, to jointly and severally pay to the Court: 1. the sum of Three Hundred Seventy Seven Thousand Pesos (P377,000.00) within a period of not less than ninety (90) days from notice of this judgment; 2. the sum of P25,000.00 to pay for the attorneys fees of [petitioners] counsel; 3. the sum of P3,210.00 costs/filing fees. In default of such payment, the property to be sold by the Courts Deputy Sheriff, to realize the mortgage debt and costs.15 It agreed with respondents that the Deed of Real Estate Mortgage was simulated and that the loan obligation was only P200,000.00. It also found that respondents made payments amounting to P107,000.00. Respondents liability was arrived at in this manner: Since the mortgage debt of P200,000.00 was contracted on August 17, 1989, when judicially demanded on June 23, 1993, the mortgage debt of P200,000.00 at 12% per annum (without compounding since there is no written agreement to that effect) earned an interest of P92,000.00 on June 17, 1993. From 1993 up

[C]onsidering that another branch of this Honorable Court, particularly Branch 72 through Judge Esther Nobles Bans had issued an order fixing the actual obligation of the [herein respondents] to [herein petitioner] in the sum of P200,000.00 with the conformity of both the herein parties, a copy of the said order is hereto attached as Annex "I" of this motion for the ready reference and guidance of this Honorable Court. In effect, the said order is in the nature of a judicial compromise or judgment that should be strictly complied with and/or honored by the herein parties, unless the same was entered into through palpable mistake. Besides, it would be the height of injustice to compel the herein [respondents] to pay more than P200,000.00 when the herein parties had already pegged the obligation of the herein [respondents] to the said [petitioner] in the sum of P200,000.00. On 6 October 1997, the court issued an Order setting aside its earlier Decision dated 9 July 1997.10 Respondent Eulogio explained that he issued several checks amounting to P107,000.00 in favor of petitioner as partial payment of the loan as evidenced by a memorandum. He added that some of the checks he issued bounced; thus, he and his wife failed to fully discharge their loan. Instead of foreclosing the mortgage on their property, petitioner chose to institute criminal cases against respondent Eulogio for issuing bouncing checks in violation of Batas Pambansa Blg. 22, docketed as Criminal Cases No. 612-90 to No. 615-90 before the Olongapo City RTC, Branch 72. He bared

46

to the present, a total of P192,000,00 in interest again accrued and adding the same to the interest due from August 17, 1989, an overall total interest of P284,000.00 at 12% per annum without compounding, is due from the [herein respondents]. Accordingly, [respondents] have paid a total of P107,000.00 to [herein petitioner], hence, deducting that amount from the total interest due, would leave an unpaid interest of P177,000,00. Adding this to the uncontroverted principal debt of P200,000.00, the [respondents] owe [petitioner] the total sum of P377,000.00.16 Respondents filed a Motion for Reconsideration asserting that the charging of interest on the loan obligation was unwarranted because no payment of interest was agreed upon. 17 In its Order dated 11 January 2002, the court denied the Motion for Reconsideration, reasoning that respondents were the ones who presented as evidence the supposed compromise agreement between petitioner and respondent Eulogio, as stated in the Order dated 15 July 1991 of the Olongapo City RTC, Branch 72, in Criminal Cases No. 612-90 to No. 615-90.18 According to the court, it used the very same compromise agreement as its basis for imposing the 12% per annum interest rate, and that respondents were precluded from disclaiming the said agreement. Unsatisfied, respondents filed an appeal with the Court of Appeals, docketed as CA-G.R. CV No. 79971. In a decision dated 13 September 2005, the appellate court reversed the Decision dated 23 October 2001 and Order dated 11 January 2002 of the Olongapo City RTC, Branch 74, and dismissed Civil Case No. 239-093.19 Citing our ruling in Bank of America v. American Realty Corporation,20 it held that a mortgagor-creditor has two choices of action: he may either file an ordinary action to recover the indebtedness or foreclose the mortgage. In short, once a collection suit is filed, the action to foreclose the mortgage is barred. It ratiocinated that although Criminal Cases No. 612-90 to No. 615-90 for Violation of Batas Pambansa Blg. 22 before the Olongapo City RTC, Branch 72, were not strictly in the nature of ordinary actions for collection/payment of debts or loans, the resulting compromise agreement in the said cases between petitioner and respondent Eulogio, on the matter of payment of the loan, had the effect of settling respondents indebtedness to petitioner. This is pursuant to Section 1, Rule 111 of the 1985 Rules on Criminal Procedure which provides that the civil action for the recovery of civil

liability is impliedly instituted in the criminal actions. Having been impliedly instituted in the criminal cases, any separate civil action for the collection or payment of the loan, like the action for foreclosure of real estate mortgage, can no longer be availed of by petitioner. Thus, it pronounced that the issue of the payment of the loan, having been the subject of the Order dated 15 July 1991 of the Olongapo City RTC, Branch 72, in Criminal Cases No. 612-90 to No. 615-90, cannot be re-litigated and that the proper course of action for petitioner was to seek the execution of the said order. In closing, the Court of Appeals decreed: Having made the foregoing pronouncement, the Court finds no necessity to discuss the second assignment of error because there being no loan obligation which can be enforced, no interest could be likewise granted in favor of [herein petitioner]. WHEREFORE, in view of the foregoing, the Decision of the Regional Trial Court of Olangapo, Branch 74, in Civil Case No. 239-0-93 is hereby REVERSED and a new one entered DISMISSING the complaint.21 Petitioner thus filed the instant Petition before us challenging the Decision dated 13 September 2005 of the Court of Appeals. In our Resolution dated 5 December 2005, we denied the Petition due to petitioners failure to submit the duplicate original or certified true copy of the assailed decision pursuant to Sections 4(d) and 5, Rule 45 in relation to Section 5(d), Rule 56 of the Rules of Court.22 Petitioner filed a Motion for Reconsideration praying that his submission of one certified true copy of the questioned decision be considered as substantial compliance with the Rules.23 Finding the Motion meritorious, we issued a Resolution dated 19 April 2006 reinstating the present Petition.24 The sole issue to be resolved is: whether petitioner, by filing Criminal Cases No. 612-90 to No. 615-90 for violation of Batas Pambansa Blg. 22 against respondent Eulogio, was already barred or precluded from availing himself of the other civil remedy of the foreclosure of the real estate mortgage.25 Petitioner maintains that, in filing Criminal Cases No. 612-90 to No. 615-90 for violation of Batas Pambansa Blg. 22 against respondent Eulogio, he should not be deemed to have impliedly instituted therein an ordinary action for collection of the loan which will preclude him from pursuing the remedy of foreclosure of real estate mortgage.26He asserts that no evidence

47

was adduced proving that the obligation for which the checks were issued in Criminal Cases No. 612-90 to No. 615-90 was the same loan obligation secured by the Deed of Real Estate Mortgage in Civil Case No. 239-0-93. Petitioners complaint-affidavit and the informations filed against respondent Eulogio in the said criminal cases, which could have shed light on the rights of the parties therein, were not presented during the trial before the Olongapo City RTC, Branch 74 in Civil Case No. 239-0-93. Petitioner argues that, if indeed the obligation for which the checks were issued in said criminal cases is the same as the obligation secured by the Deed of Real Estate Mortgage, the Olongapo City RTC, Branch 72 would have mentioned in its Order dated 15 July 1991 in Criminal Cases No. 612-90 to No. 615-90 that the consideration in the Deed of Real Estate Mortgage was being reduced to only P200,000.00.27 Moreover, petitioner claims that respondents did not pay a single centavo under the compromise agreement in Criminal Cases No. 612-90 to No. 615-90. The compromise agreement was thus deemed abandoned, with no more force and effect. Petitioner further asseverates that 14 years had already lapsed from the time the Order dated 15 July 1991 of the Olongapo City RTC, Branch 72 in Criminal Cases No. 612-90 to No. 615-90 became final, so that he can no longer file a Motion for Execution thereof or an Action to Revive Judgment. It was for this very reason why petitioner was constrained to file an action for judicial foreclosure of mortgage. To enjoin his action to foreclose the real estate mortgage would be an injustice since he would be left with no other recourse in recovering the loan balance from respondents. 28 For reasons of justice and equity, we rule in favor of petitioner. At the threshold, the following discussion merits equal attention. A mortgage-creditor may, in the recovery of a debt secured by a real estate mortgage, institute against the mortgagedebtor either a personal action for debt or a real action to foreclose the mortgage. These remedies available to the mortgage-creditor are deemed alternative and not cumulative. An election of one remedy operates as a waiver of the other. In sustaining the rule that prohibits a mortgage-creditor from pursuing both remedies of a personal action for debt or a real action to foreclose the mortgage, we held in Bachrach Motor Co., Inc. v. Icarangal,29 that a rule which would authorize the mortgage-creditor to bring a personal action against the mortgage-debtor and simultaneously or successively another action against the mortgaged property, would

result not only in multiplicity of suits so offensive to justice and obnoxious to law and equity, but would also subject the mortgagedebtor to the vexation of being sued in the place of his residence or of the residence of the mortgage-creditor, and then again in the place where the property lies. Hence, a remedy is deemed chosen upon the filing by the mortgage-creditor of the suit for collection or upon his filing of the complaint in an action for foreclosure of mortgage, pursuant to the provisions of Rule 68 of the Rules of Court.30 Proceeding therefrom, we shall now determine whether petitioners filing of Criminal Cases No. 612-90 to 615-90 is equivalent to the filing of a collection suit for the recovery of the mortgageloan which, pursuant to the aforesaid rule on the alternative remedies of collection and foreclosure, precludes the petitioner from subsequently availing himself of the action to foreclose the mortgaged property. When petitioner filed Criminal Cases No. 612-90 to No. 615-90 for violation of Batas Pambansa Blg. 22 against respondent Eulogio, petitioners civil action for the recovery of the amount of the dishonored checks was impliedly instituted therein pursuant to Section 1(b) of Rule 111 of the 2000 Rules on Criminal Procedure. In the case of Hyatt Industrial Manufacturing Corporation v. Asia Dynamic Electrix Corporation,31 we elucidated thus: We agree with the ruling of the Court of Appeals that upon filing of the criminal cases for violation of B.P. 22, the civil action for the recovery of the amount of the checks was also impliedly instituted under Section 1(b) of Rule 111 of the 2000 Rules on Criminal Procedure. Under the present revised Rules, the criminal action for violation of B.P. 22 shall be deemed to include the corresponding civil action. The reservation to file a separate civil action is no longer needed. The Rules provide: Section 1. Institution of criminal and civil actions. (a) x x x x (b) The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to include the corresponding civil action. No reservation to file such civil action separately shall be allowed. Upon filing of the aforesaid joint criminal and civil actions, the offended party shall pay in full the filing fees based on the amount of the check involved, which shall be considered as the

48

actual damages claimed. Where the complaint or information also seeks to recover liquidated, moral, nominal, temperate or exemplary damages, the offended party shall pay additional filing fees based on the amounts alleged therein. If the amounts are not so alleged but any of these damages are subsequently awarded by the court, the filing fees based on the amount awarded shall constitute a first lien on the judgment. Where the civil action has been filed separately and trial thereof has not yet commenced, it may be consolidated with the criminal action upon application with the court trying the latter case. If the application is granted, the trial of both actions shall proceed in accordance with section 2 of this Rule governing consolidation of the civil and criminal actions. The foregoing rule was adopted from Circular No. 57-97 of this Court. It specifically states that the criminal action for violation of B.P. 22 shall be deemed to include the corresponding civil action. It also requires the complainant to pay in full the filing fees based on the amount of the check involved. Generally, no filing fees are required for criminal cases, but because of the inclusion of the civil action in complaints for violation of B.P. 22, the Rules require the payment of docket fees upon the filing of the complaint. This rule was enacted to help declog court dockets which are filled with B.P. 22 cases as creditors actually use the courts as collectors. Because ordinarily no filing fee is charged in criminal cases for actual damages, the payee uses the intimidating effect of a criminal charge to collect his credit gratis and sometimes, upon being paid, the trial court is not even informed thereof. The inclusion of the civil action in the criminal case is expected to significantly lower the number of cases filed before the courts for collection based on dishonored checks. It is also expected to expedite the disposition of these cases. Instead of instituting two separate cases, one for criminal and another for civil, only a single suit shall be filed and tried. It should be stressed that the policy laid down by the Rules is to discourage the separate filing of the civil action. The Rules even prohibit the reservation of a separate civil action, which means that one can no longer file a separate civil case after the criminal complaint is filed in court. The only instance when separate proceedings are allowed is when the civil action is filed ahead of the criminal case. Even then, the Rules encourage the consolidation of the civil and criminal cases. We have previously observed that a separate civil action for the purpose of recovering the amount of the dishonored checks would only prove to be costly,

burdensome and time-consuming for both parties and would further delay the final disposition of the case. This multiplicity of suits must be avoided. Where petitioners rights may be fully adjudicated in the proceedings before the trial court, resort to a separate action to recover civil liability is clearly unwarranted. x x x. The impliedly instituted civil action in Criminal Cases No. 612-90 to No. 615-90 for violation of Batas Pambansa Blg. 22 was, in effect, a collection suit or suit for the recovery of the mortgage-debt since the dishonored checks involved in the said criminal cases were issued by respondent Eulogio to petitioner for the payment of the same loan secured by the Deed of Real Estate Mortgage. As correctly found by the Olongapo City RTC, Branch 74, in its Decision dated 23 October 2001 in Civil Case No. 239-0-93: After a careful scrutiny of the evidence adduced by the parties, this Court will not hesitate to state that - it is convinced that the parties had one and only transaction, the one constituted on August 17, 1989; xxxx - the bouncing checks for which defendant was criminally charged with, were part of the checks issued to plaintiff in consideration of the mortgage debt secured on August 17, 1989; - defendants payment for those checks should appropriately be considered as payment of the mortgage debt, defendants only obligation in favor of the plaintiff; xxxx The Court has likewise taken note of the fact that plaintiff is a businessman by his admission, and the fact that the purpose of the defendants seeing him on August 17, 1989 is in order to borrow money. The testimony of plaintiff that defendants are known to him cannot be related to any special occasion or event of meeting and later becoming friends, otherwise plaintiff could have stated so. His having known the defendants refer to only one occasion, that is, when the defendants came to his business office to obtain a loan. Anyone can do that. That person would then be his debtor. And so, defendants on August 17, 1989 became debtors of the plaintiff.

49

Why would defendants come to plaintiff if not for that purpose? Plaintiff is known in Olongapo City as a money lender. His business at 1670 Rizal Avenue, West Bajac-bajac is a money lending business. As a lender, plaintiffs prime concern is profit. In order to attain this, he has to impose double measures to protect his interest. First, to ask the borrower to produce the title to the property intended as collateral. On this, the lender asks the borrower to execute a deed of mortgage. Plaintiff does not operate as a commercial bank neither as a rural bank, hence, he belongs to the group that allows a borrower to repay within a shorter period. Secondly, to facilitate collection of the monthly repayments, the lender requires the borrower to issue checks for each month ensuing all in equal amounts. Usually, the checks so issued would also include the interest due each month, but in this case, there is no testimony to that effect. However, it can be assumed considering the subsequent acts of the parties. As soon as the borrower is able to satisfy the two conditions, he gets the desired loan. The lender then has the borrowers head, as well as his tail, in his hands, and that is the predicament where the defendants found themselves in. Defendants were, however, confronted with a problem. Someone else is after their property, a third person in whose favor they owe a demandable obligation. This person is hot on pursuing the property to satisfy what defendants owe her. And defendants opened up and relayed their predicament to the plaintiff and the latter agreed. Anxious that the defendants property will eventually be attached or levied, leaving the loan he will give without any collateral, plaintiff agreed to simulate the amount in the Deed, to an amount higher that the third persons claim against the defendants but at the same time he required from the defendants checks to cover the P200,000.00 loan. Defendant Eulogio testified that he issued the checks for the amount of P200,000.00 and plaintiff did not deny this. x x x.32 Consequently, when petitioner filed Criminal Cases No. 612-90 to No. 615-90, he was deemed to have already availed himself of the remedy of collection suit. Following the rule on the alternative remedies of a mortgagecreditor, petitioner is barred from subsequently resorting to an action for foreclosure. However, it should be stressed that respondents have not yet fully paid the loan. 1awphi1 In fact,

respondents themselves admitted that they still owe petitioner the balance of the loan.33 To allow respondents to benefit from the loan without paying its whole amount to petitioner, and to preclude the petitioner from recovering the remaining balance of the loan, would constitute unjust enrichment at the expense of petitioner. The principle that no person may unjustly enrich himself at the expense of another (Nemo cum alterius detrimento locupletari potest) is embodied in Article 22 of the New Civil Code, to wit: ART. 22. Every person who through an act of performance by another, or any other means, acquires or comes into possession of something at the expense of the latter without just or legal ground, shall return the same to him. As can be gleaned from the foregoing, there is unjust enrichment when (1) a person is unjustly benefited, and (2) such benefit is derived at the expense of or with damages to another. 34 The main objective of the principle of unjust enrichment is to prevent one from enriching oneself at the expense of another. 35 It is commonly accepted that this doctrine simply means that a person shall not be allowed to profit or enrich himself inequitably at anothers expense.36 One condition for invoking this principle is that the aggrieved party has no other action based on contract, quasi-contract, crime, quasi-delict or any other provision of law.37 The principle of unjust enrichment obliges the respondents to pay the remaining balance of the loan plus interest. Relieving the respondents of their obligation to pay the balance of the loan would, indeed, be to sanction unjust enrichment in favor of respondents and cause unjust poverty to petitioner. In the exercise of our mandate as a court of justice and equity,38 we hold, pro hac vice, that respondents are still liable to pay the remaining balance of the loan. We, nonetheless, do not subscribe to the computations made by the RTC. In Eastern Shipping Lines, Inc. v. Court of Appeals, 39 we ruled that when the obligation is breached and it consists in the payment of a sum of money such as a loan, the interest due should be that which may have been stipulated in writing. We also held that the interest due shall itself earn legal interest from the time it is demanded, and that in the absence of stipulation as to the payment of interest, the rate of interest shall be

50

12% per annum to be computed from default, i.e., from judicial or extra-judicial demand. We further declared that when the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest, regardless of whether it is a loan/forbearance of money case or not, shall be 12% per annum from such finality until its satisfaction, this interim period being deemed to be then equivalent to a forbearance of credit. In the instant case, there was no written agreement as to the payment of interest on the mortgage-loan between petitioner and respondents. The rate of interest, therefore, is 12% per annum, to be computed from the time an extra-judicial demand was made by the petitioner on 30 July 1992.40 We also found that an amount of P107,000.00 out of the total loan of P200,000.00 was already paid by the respondents. Thus, only the balance of P93,000.00 should earn a legal interest of 12% per annum from the time of the extrajudicial demand on 30 July 1992. In addition, a legal interest of 12% per annum should also be imposed to be computed from the finality of this Decision up to its satisfaction. WHEREFORE, the instant Petition is hereby GRANTED. The Decision of the Court of Appeals dated 13 September 2005 in CA-G.R. CV No. 79971 is hereby REVERSED and SET ASIDE. Respondents Eulogio and Teresita Santos are hereby ORDERED to pay petitioner Antonio Chieng, substituted by William Chieng, the balance of the loan amounting to P93,000.00, plus legal interest of 12% per annum from 30 July 1992 up to the finality of this Decision, and an additional legal interest of 12% per annum from the finality of this Decision up to its satisfaction. No costs. SO ORDERED. G.R. No. 167546 July 17, 2009

Fuentebella Highway at Barangay Hibago, Ocampo, Camarines Sur. The bus was bound for Naga City while the taxi was going in the opposite direction of Partido Area. The collision resulted in the death of Gerardo Breis, Sr.,5 Arnaldo Breis,6 Gerardo Breis, Jr.,7 Rene Montes,8 Erwin Breis9 and Jimmy 10 Padua. Luckily, Edwin Breis and his son Edmund Breis survived although they sustained serious injuries. As a consequence, petitioner was charged with the crime of reckless imprudence resulting in multiple homicide and multiple serious physical injuries with damage to property in the Municipal Trial Court (MTC) of Ocampo, Camarines Sur. After trial on the merits, the MTC acquitted petitioner of the crime charged in a decision11 dated November 9, 2000. Petitioner was, however, held civilly liable and was ordered to pay the heirs of the victims the total amount ofP3,541,900 by way of actual damages, civil indemnity for death, moral damages, temperate damages and loss of earning capacity. Petitioner appealed to the Regional Trial Court (RTC) of Pili, Camarines Sur, claiming that the MTC erred in holding him civilly liable in view of his acquittal. On July 17, 2001, the RTC affirmed the MTC judgment in toto.12 Refusing to give up, petitioner appealed13 to the Court of Appeals (CA). On March 3, 2005, the CA rendered the assailed decision14 affirming the RTC. Left with no other recourse, petitioner now argues15 that his acquittal should have freed him from payment of civil liability. He also claims that he should be totally exonerated from any liability because it was Gerardo Breis, Sr., not the regular driver, Jimmy Padua, who was actually driving the taxi at the time of the accident, which was clearly in violation of insurance and transportation laws. We disagree. The rule is that every person criminally liable is also civilly liable.16 Criminal liability will give rise to civil liability only if the felonious act or omission results in damage or injury to another and is the direct and proximate cause thereof.17 Every crime gives rise to (1) a criminal action for the punishment of the guilty party and (2) a civil action for the restitution of the thing, repair of the damage, and indemnification for the losses.18

SONNY ROMERO Y DOMINGUEZ, Petitioner, vs. PEOPLE OF THE PHILIPPINES, ISABEL PADUA, REGINA BREIS, MINERVA MONTES and OFELIA BELANDO BREIS,1 Respondents. RESOLUTION CORONA, J.: On April 1, 19992 at around 12:00 noon, the JC Liner3 driven by petitioner Sonny Romero and the Apego Taxi4driven by Jimmy Padua figured in a head-on collision along Governor Jose

51

However, the reverse is not always true. In this connection, the relevant portions of Section 2, Rule 111 and Section 2, Rule 120 of the Rules of Court provide: Sec. 2. When separate civil action is suspended . xxx The extinction of the penal action does not carry with it extinction of the civil action. However, the civil action based on delict shall be deemed extinguished if there is a finding in a final judgment in the criminal action that the act or omission from which the civil liability may arise did not exist. (emphasis supplied)

In view of the pronouncements of the MTC and the RTC, we agree with the conclusion of the CA that petitioner was acquitted not because he did not commit the crime charged but because the RTC and the MTC could not ascertain with moral conviction the wanton and reckless manner by which petitioner drove the bus at the time of the accident. Put differently, petitioner was acquitted because the prosecution failed to prove his guilt beyond reasonable doubt. However, his civil liability for the death, injuries and damages arising from the collision is another matter. While petitioner was absolved from criminal liability because his negligence was not proven beyond reasonable doubt, he can still be held civilly liable if his negligence was established by preponderance of evidence.24 In other words, the failure of the evidence to prove negligence with moral certainty does not negate (and is in fact compatible with) a ruling that there was preponderant evidence of such negligence. And that is sufficient to hold him civilly liable. Thus, the MTC (as affirmed by the RTC and the CA) correctly imposed civil liability on petitioner despite his acquittal. Simple logic also dictates that petitioner would not have been held civilly liable if his act from which the civil liability had arisen did not in fact exist. Anent the second issue, it would be well to remind petitioner of the time-honored doctrine that this Court is not a trier of facts. 25 The rule finds greater relevance in this case because the MTC,26 the RTC27 and the CA28uniformly held that it was Jimmy Padua, and not Gerardo Breis, Sr., who was driving the taxi at the time of the accident. There are of course instances29 when this Court can embark on a re-examination of the evidence adduced by the parties during trial. Sad to say, none of those instances is present here. WHEREFORE, the petition is hereby DENIED. Costs against petitioner. SO ORDERED.

Sec. 2. Contents of the judgment.xxx In case the judgment is of acquittal, it shall state whether the evidence of the prosecution absolutely failed to prove the guilt of the accused or merely failed to prove his guilt beyond reasonable doubt. In either case, the judgment shall determine if the act or omission from which the civil liability might arise did not exist. (emphasis supplied) Thus, the rule is that the acquittal of an accused of the crime charged will not necessarily extinguish his civil liability, unless the court declares in a final judgment that the fact from which the civil liability might arise did not exist.19 Courts can acquit an accused on reasonable doubt but still order payment of civil damages in the same case.20 It is not even necessary that a separate civil action be instituted.21 In this case, the MTC held that it could not ascertain with moral certainty the wanton and reckless manner by which petitioner drove the bus in view of the condition of the highway where the accident occurred and the short distance between the bus and the taxi before the collision. However, it categorically stated that while petitioner may be acquitted based on reasonable doubt, he may nonetheless be held civilly liable. 221avvphi1 The RTC added that there was no finding by the MTC that the act from which petitioners civil liability may arise did not exist. Therefore, the MTC was correct in holding petitioner civilly liable to the heirs of the victims of the collision for the tragedy, mental anguish and trauma they suffered plus expenses they incurred during the wake and interment.23

52

G.R. No. 147923

October 26, 2007

JIMMY T. GO, petitioner, vs. ALBERTO T. LOOYUKO, respondent. x-------------------------------------------x G.R. No. 147962 October 26, 2007

JIMMY T. GO, petitioner, vs. ALBERTO T. LOOYUKO and COURT OF APPEALS, respondent. x-------------------------------------------x G.R. No. 154035 October 26, 2007

The third, G.R. No. 154035,12 assails the January 31, 2002 CA Decision 13 in CA-G.R. SP No. 62296, which affirmed the Makati City RTC May 9, 2000 Order14 in Criminal Case No. 981643, denying petitioners prayer to defer submission of the formal offer of evidence and at the same time granting leave to respondent to file demurrer to evidence, and the September 22, 2000 Order15 denying reconsideration of the May 9, 2000 Order. Likewise challenged is the June 3, 2002 CA Resolution 16 of the CA disallowing petitioners Motion for Reconsideration. The second, G.R. No. 147923, and third, G.R. No. 154035, petitions under Rule 45 of the Rules of Court arose from Criminal Case No. 981643 entitled People of the Philippines v. Alberto T. Looyuko for Estafa under Article 315, paragraph 1 (b) of the Revised Penal Code before the Makati City RTC, Branch 56. In G.R. No. 154035, we consolidated the three petitions having originated from the same criminal case involving the same parties with interrelated issues. Although the latter petition raises the issue of the existence of a business partnership and propriety of the conduct of the inventory of assets and properties of Noahs Ark Sugar Refinery in Civil Case No. 67921, all the foregoing actions trace their beginnings from the same factual milieu.17 The Facts Petitioner Go and respondent Looyuko were business associates. Respondent is the registered owner of Noahs Ark Merchandising, a sole proprietorship, which includes Noahs Ark International, Noahs Ark Sugar Carriers, Noahs Ark Sugar Truckers, Noahs Ark Sugar Repacker, Noahs Ark Sugar Insurers, Noahs Ark Sugar Terminal, Noahs Ark Sugar Building and the land on which the building stood, and Noahs Ark Sugar Refinery, and the plant/building/machinery in the compound and the land on which the refinery is situated. These businesses are collectively known as the Noahs Ark Group of Companies. Go was the business manager or chief operating officer of the group of companies. Sometime in 1997, the business associates had a falling out that spawned numerous civil lawsuits. Among these actions are Civil Case No. 67921 and Criminal Case No. 98-1643 from which arose several incidents which eventually became subject of these consolidated petitions. Criminal Case No. 98-1643

JIMMY T. GO, petitioner, vs. ALBERTO T. LOOYUKO, respondent. DECISION VELASCO, JR., J.: The Case Before us are three (3) petitions. The first, 1 G.R. No. 147962, is for certiorari under Rule 65. It assails the February 12, 2001 Resolution 2 of the Court of Appeals (CA) in CA-G.R. SP No. 62438, which granted a Writ of Preliminary Injunction in favor of respondent Looyuko restraining the Orders of the Pasig City Regional Trial Court (RTC), Branch 69, from enforcing the Orders dated September 25, 2000,3 December 19, 2000,4 and December 29, 20005 in Civil Case No. 67921 entitled Jimmy T. Go v. Alberto T. Looyuko for Specific Performance, Accounting, Inventory of Assets and Damages; also questioned is the April 24, 2001 CA Resolution6 which rejected petitioners plea for reconsideration. G.R. No. 1479237 assails the September 11, 2000 CA Decision8 in CA-G.R. SP No. 58639, which upheld the December 16, 19999 Makati City RTC Order denying the requested inhibition of RTC Judge Nemesio Felix (now retired) and the March 8, 2000 Order10 which denied the recall of the December 16, 1999 Order and which likewise required the prosecution to make a formal offer of evidence. Also challenged is the March 27, 2001 CA Resolution11 denying petitioners Motion for Reconsideration.

53

On May 21, 1998, petitioner filed People of the Philippines v. Alberto T. Looyuko , an Affidavit Complaint18 before the Makati City RTC, Branch 56, charging respondent with Estafa under Article 315, paragraph 1 (b) of the Revised Penal Code. The case was docketed as Criminal Case No. 98-1643. Petitioner alleged that respondent misappropriated and converted in his name petitioners 41,376 China Banking Corporation (CBC) shares of stock. Petitioner averred that he entrusted the stock certificates to respondent for the latter to sell. The Information reads: That sometime during the month of May, 1997 or prior thereto, in the City of Makati, Philippines and within the jurisdiction of this Honorable Court, the above-named accused, received in trust from complainant Jimmy T. Go China Banking Corporation stock certificates numbers 25447, 25449, 25450, 26481, 28418, 30916, 32501, 34697 and 36713 representing the 41,376 shares of stocks of the complainant with China Banking Corporation, with a market value of P1,400.00 per share, more or less, with the obligation on the part of the accused to sell the same and remit the proceeds thereof to the complainant, but the accused, once in possession of said stock certificates, far from complying with his aforesaid obligation, with intent to gain and abuse of confidence, did then and there willfully, unlawfully and feloniously misappropriated, misapply and convert the said shares of stocks to his own personal benefit by causing the transfer of said stock certificates to his name considering that the same were endorsed in blank by the complainant out of the latters trust to the accused, and the accused never paid the market value of said shares of stocks, which is P1,400.00 per share, more or less, or a total market value of P57,926,400.00 for the 41,376 shares of stocks, to the damage and prejudice of the complainant in the amount of P7,926,400.00. CONTRARY TO LAW.19 After respondent pleaded "Not Guilty," and after the testimonies of the prosecution witnesses among them, Go and Amalia de Leon, an employee of CBC, who testified that certificates of stocks in Gos name were cancelled and new certificates were issued in Looyukos name. Earlier, subpoena ad testificandum and subpoena duces tecumwere issued to Peter Dee, President of CBC, Atty.

Arsenio Lim, Corporate Secretary of CBC, and Gloria Padecio. The trial court also felt no need for the testimonies of Dee, Lim, and Padecio and ordered the prosecution to offer its evidence. Petitioner filed a Motion for Reconsideration and asked that the prosecution be allowed to present its last witness from Amsteel Securities, Inc., Bohn Bernard J. Briones. The RTC granted the motion. However, at the conclusion of Briones testimony, the prosecution moved to subpoena Alvin Padecio which was vehemently objected to by the defense. The trial court denied the motion. The prosecution thereafter opted to ask for ten (10) days to formally offer its documentary evidence. The trial court granted the request. Instead of filing its formal offer of evidence, the prosecution filed an Urgent Motion for Reconsideration,20 then a Supplemental Motion with Manifestation, and a Second Supplemental Motion with Manifestation, 21 all praying that the testimony of Alvin Padecio be allowed. For his part, respondent filed a Motion to Declare the Prosecution as Having Waived its Right to Make a Formal Offer of Evidence.22 Hence, petitioner filed an Omnibus Motion to Withdraw the Urgent Motion for Reconsideration with Motion for Inhibition.23 On December 16, 1999, the trial court denied petitioners motion for inhibition;24 petitioners motion to declare the prosecution to have waived its right to file formal offer of evidence; and gave the prosecution a last chance to submit its formal offer of documentary evidence within ten (10) days from notice.25 Petitioner moved to defer compliance with the submission of its formal offer of documentary evidence pending petitioners motion for reconsideration of the trial courts December 16, 1999 Order denying petitioners motion for inhibition.26 The RTC denied petitioners motion and granted the prosecution a last opportunity to submit its formal offer of documentary evidence within five (5) days from notice.27 Frustrated, petitioner adamantly reiterated his motion for inhibition in a Manifestation/Motion28 praying that the trial court reconsider its Order directing the prosecution to formally offer its documentary evidence in deference to the petition for certiorari it intends to file with the CA, where it would assail the December 16, 1999 and March 8, 2000 Orders denying the inhibition of the judge.

54

Subsequently, petitioner filed a Petition for Certiorari29 under Rule 65 before the CA. It again sought the reversal of the orders denying his motion for inhibition. The petition was docketed as CA-G.R. SP No. 58639. Meanwhile, before the RTC hearing the criminal case, respondent filed an Omnibus Motion30 dated March 20, 2000 to declare petitioner to have rested his case on the basis of the prosecutions testimonial evidence and to grant respondent leave to file his demurrer to evidence. The RTC denied the Omnibus Motion. Petitioner timely filed a Motion for Reconsideration/Manifestation, which was denied. Respondent filed his demurrer to evidence incorporating in it his offer of evidence. Petitioner filed another petition for certiorari before the CA, docketed as CA-G.R. SP No. 62296. It sought to reverse the orders of the trial court declaring petitioner to have waived his right to formally offer his documentary evidence and allowing respondent to file a demurrer to evidence. While these motions were being considered by the trial court, petitioner filed an administrative case docketed as OCA I.P.I. No. 00-971-RTJ against the trial court Presiding Judge Nemesio S. Felix. It charged Judge Felix with Partiality, relative to Criminal Case No. 98-1643. Citing the administrative case he filed against Judge Felix, petitioner filed a Second Motion for Voluntary Inhibition31 before the trial court. The trial court denied the second motion. 32 His Motion for Reconsideration was opposed 33 by respondent. Civil Case No. 67921 Meanwhile, during the pendency of Crim. Case No. 98-1643, on May 23, 2000, petitioner filed a Complaint34docketed as Civil Case No. 67921 entitled Jimmy T. Go v. Alberto T. Looyuko for Specific Performance, Accounting, Inventory of Assets and Damages against respondent before the Pasig City RTC. Petitioner claimed that in two (2) Agreements executed on February 9, 198235 and October 10, 1986,36 respondent and petitioner agreed to have their venture registered with the Department of Trade and Industry (DTI) in the name of Looyuko as sole proprietor, and both agreed to be equally entitled to 50% of the business, goodwill, profits, and real and personal properties owned by the group of companies. Petitioner alleged that respondent had committed and continued to commit insidious acts to oust him from the

ownership of half of the assets of the firms under Noahs Ark Group of Companies in breach of their agreements. Thus, petitioners action for specific performance, accounting, and inventory of assets and damages was instituted against respondent. Respondent filed a motion to dismiss on the grounds of forum shopping, litis pendentia, and abandonment or laches. The motion to dismiss was denied.37 The trial court likewise denied respondents Motion for Reconsideration.38 The trial court nevertheless granted petitioners motion to conduct an inventory of the assets of the group of companies but under the direct supervision and control of the Branch Clerk of Court.39 On January 2, 2001, respondent filed before the CA a Petition for Certiorari40 with application for a temporary restraining order (TRO) and preliminary injunction assailing the trial courts orders denying respondents motion to dismiss and grant of the motion of petitioner to conduct an inventory. Respondent also filed a Manifestation and Motion for Reconsideration of the grant of the motion to inventory before the trial court. Therein, respondent informed the trial court of his intention to elevate the denial of his motion to dismiss before the CA, praying that no further proceedings be conducted in view thereof. Apparently, respondents petition for certiorari before the CA did not mention the fact of the Manifestation and Motion for Reconsideration filed and pending before the trial court. After filing the petition for certiorari, respondent filed an Urgent Ex-Parte Motion to Admit Additional Annexes to Petition.41 In the meantime, on January 5, 2001, the inventory of assets in the Noahs Ark Sugar Refinery was completed. Three days after the CA issued a Resolution42 enjoining the trial court from enforcing its orders denying the motion to dismiss and grant of motion to inventory, it set the hearing for the application of the injunctive writ on January 29, 2001. On February 9, 2001, petitioner filed his opposition43 to respondents urgent motion to admit additional annexes to petition which was replied44 by respondent with additional annexes appended thereto.

55

The Ruling of the Court of Appeals in CA-G.R. SP No. 58639 (Criminal Case No. 98-1643) On September 11, 2000, the CA rendered the assailed Decision dismissing the petition. The CA explained that the petition was initiated solely by petitioner and was dismissible for it did not implead nor have the participation of the Office of the Solicitor General. And, on the merits, the appellate court ruled that the voluntary inhibition prayed by petitioner had no legal and factual basis. The appellate court found that three (3) alleged grounds of partiality raised by petitioner were not badges of partiality. The appellate court ruled that the denial of the testimony of three (3) witnesses and that of Alvin Padecio was an exercise of sound discretion by the judge. Besides, the CA added, Alvin Padecio, son of respondent, was entitled to the testimonial privilege set forth in Section 25,45 Rule 130 of the Rules of Court. Moreover, the appellate court found baseless the other two (2) grounds of partiality. In fine, the CA held that mere allegation of partiality and bias will not suffice for a judge to voluntarily inhibit himself and shirk from responsibility of hearing the case. On March 27, 2001, the appellate court likewise denied petitioners Motion for Reconsideration. Thus, petitioner assails the above Decision and Resolution of the appellate court in CA-G.R. SP No. 58639 through a Petition for Review on Certiorari before us docketed as G.R. No. 147923.

Since petitioner pursued neither, he cannot fault the trial court from issuing the assailed orders. Finally, on the issue of the demurrer to evidence, the CA held that such was seasonably filed by respondent. It ruled in this wise: In the case before the Respondent Court, the Petitioner had presented its witnesses but had no documentary evidence to formally offer as it was considered to have waived the same by his intractable refusal to file its " Formal Offer of Evidence." Hence, the "Demurrer to Evidence," filed by the Private Respondent, was seasonably filed with the Respondent Court.46 Petitioners Motion for Reconsideration was also denied. Hence, petitioner assails the above Decision and Resolution of the appellate court in CA-G.R. SP No. 62296 through a Petition for Review on Certiorari before us docketed as G.R. No. 154035. The Ruling of the Court of Appeals in CA-G.R. SP No. 62438 (Civil Case No. 67921) On February 12, 2001, the CA issued the assailed Resolution, granting a writ of preliminary injunction conditioned on the filing of a PhP 50,000 bond. The CA ruled that the requisites for an injunctive writ were present and that thestatus quo at the inception of the case on May 23, 2000 must be observed. Thus, the appellate court enjoined the trial court from enforcing its Orders dated September 25, 2000, December 19, 2000, and December 29, 2000, and from conducting further proceedings in the case pending resolution of the certiorari case. Petitioners Motion for Reconsideration was denied through the appellate courts April 24, 2001 Resolution. Thus, petitioner assails the above Resolutions of the appellate court in CAG.R. SP No. 62438 through a petition for certiorari under Rule 65 before us docketed as G.R. No. 147962. The Issues In G.R. No. 147923, petitioner Go raises the sole issue: Whether the Honorable Court of Appeals committed reversible errors when it failed to apply the law and established jurisprudence on the matter by issuing the questioned Resolutions (sic) thereby

The Ruling of the Court of Appeals in CA-G.R. SP No. 62296 (Criminal Case No. 98-1643) On January 31, 2002, the appellate court in CAG.R. SP No. 62296 rendered the assailed Decision. The CA in dismissing the petition ruled that the trial court did not commit grave abuse of discretion in finding that the petitioner had waived his right to file a formal offer of documentary evidence and in allowing respondent to file a demurrer to evidence. It ratiocinated that the pendency of the issue of inhibition before the appellate court absent a TRO did not suspend the proceedings in the trial court. The CA pointed out that petitioner should have pursued his plea for injunctive relief before it or to file with the trial court his Formal Offer of Evidence Ex Abundantia Cautelam.

56

affirming the questioned Orders of the Court a quo which were issued with grave abuse of discretion. In G.R. No. 154035, petitioner Go raises the sole issue: Whether the Honorable Court of Appeals committed reversible errors when it failed to apply the law and established jurisprudence on the matter by issuing the questioned Resolutions thereby affirming the questioned Orders of the Court a quo which were issued with grave abuse of discretion. In G.R. No. 147962, petitioner Go alleges that the respondent CA acted with grave abuse of discretion and in excess of its jurisdiction in rendering the questioned Resolutions when: 1) It failed to dismiss the questioned Petition notwithstanding the fatal error committed by Looyuko in intentionally failing to await the resolution of his Motion for Reconsideration filed in the Court a quo before filing his Petition with the Court of Appeals. 2) It failed to dismiss the questioned Petition on the ground of Looyukos failure to attach all relevant and pertinent documents to his Petition. 3) It failed to dismiss the questioned Petition notwithstanding the fact that Looyuko violated the rule against forumshopping. 4) It failed to apply the rule that consummated acts could no longer be restrained by injunction. 5) It granted Looyukos prayer for injunction. Injunction should have been denied. Looyuko has unclean hands and he seeks equity without "doing equity." No irreparable damage exists and a plain and adequate legal remedy is available to him. 6) It fixed the amount of the injunction bond in the measly amount of P50,000.00. Meanwhile, during the pendency of these petitions, respondent Looyuko died on October 29, 2004.47 The Courts Ruling

The petitions are partly meritorious. G.R. Nos. 147923 and 154035 We will tackle G.R. Nos. 147923 and 154035 jointly since the issues raised are closely interwoven as the pending incidents arose from the same Crim. Case No. 98-1643. Voluntary Inhibition: Not a remedy absent valid grounds In G.R. No. 147923, petitioner strongly asserts that Presiding Judge Nemesio Felix has displayed manifest bias and partiality in favor of respondent by disallowing the presentation of the testimonies of the prosecutions vital witnesses, namely, Dee, Lim, Gloria Padecio, and Alvin Padecio, without any valid reason and in utter bad faith. Petitioner also foists the alleged badges of partiality in the conduct and attitude of the trial court judge during the proceedings; and that it is revealing that the respondent and his counsel knew the judge beforehand. Finally, petitioner points to the apparent animosity and enmity of Judge Felix in his Comment to the administrative case (OCA I.P.I. No. 00-971-RTJ) filed by petitioner against him. We have ploughed through the records and we are constrained to agree with the findings of the appellate court.First, we find no manifest partiality. Indeed, the adverse rulings on the denial of the proposed testimonies of the prosecutions witnesses are judicial in nature. Absent proof that the trial court judge had acted in a wanton, whimsical or oppressive manner or for an illegal consideration, and similar reasons, in giving undue advantage to respondent, inhibition is not a remedy to oust the judge from sitting on the case. Second, the other two (2) grounds raised by petitioner are also baseless. We reiterate the age-old rule in civil cases that one who alleges a fact has the burden of proving it and a mere allegation is not evidence.48 Verily, petitioner has not shown substantial proof to bolster these allegations. It is quite revealing what was pointed out by Judge Felix in his December 16, 1999 Order, as quoted by the appellate court, that the allegation of respondents counsel saying to petitioner that "Amin na si Judge" first came out only in petitioners second supplemental motion with manifestation dated September 7, 1999. If it was indeed uttered by respondents counsel, such would have been immediately stated in the prior pleadings of petitioner: the urgent motion for reconsideration dated August 26, 1999 and

57

supplemental motion with manifestation dated August 31, 1999. Besides, in a string of cases, this Court has said that bias and prejudice, to be considered valid reasons for the voluntary inhibition of judges, must be proved with clear and convincing evidence. Bare allegations of partiality and prejudgment will not suffice.49 Third, on June 26, 2002, we dismissed the administrative case filed by petitioner against Judge Felix in OCA I.P.I. No. 00-971-RTJ. Therein, we found no basis to administratively discipline respondent judge for manifest partiality. Verily, the assailed orders were issued with judicial discretion and no administrative liability attaches absent showing of illegal consideration or giving undue advantage to a party, and much less can we compel the trial court judge to inhibit himself absent valid grounds therefor. Fourth, since the grounds raised by petitioner in his motion to inhibit are not among those expressly mentioned in Section 1, Rule 137 of the Revised Rules of Court, the decision to inhibit himself lies within the sound discretion of Judge Felix. Grounds raised outside the five (5) mandatory disqualification of judges enumerated in the first paragraph of Sec. 1 of Rule 137 are properly addressed to the sound discretion of the trial court judge hearing a case as pertinently provided for in the second paragraph of Sec. 1, Rule 137, thus: SECTION 1. Disqualification of judges. xxx A judge may, in the exercise of his sound discretion, disqualify himself from sitting in a case, for just or valid reasons other than those mentioned above. Thus, it is clearly within the discretion of the judge to voluntarily inhibit himself from sitting in a case or not. Fifth, we fail to appreciate petitioners contention that the harsh language in the comment of Judge Felix shows his apparent animosity and enmity against petitioner. We have gone over the 2nd Indorsement (Comment) of Judge Felix and we failed to find such animosity against petitioner. Be that as it may, the tenor of the comment is usual given the indignation and the bother that judges, and other court employees for that matter, have to go through when faced with an administrative case.

Finally, this issue has been mooted as Judge Nemesio Felix had compulsorily retired on December 19, 2004. Grave abuse of discretion in the denial of additional witnesses At this juncture, we come to the issue of denial of additional witnesses. Petitioner contends that the prosecution should have been given the opportunity to present four witnesses, namely, Dee, the President of CBC; Lim, Corporate Secretary of CBC; Gloria Padecio and Alvin Padecio, whom petitioner strongly avers are vital witnesses to prove the allegations in the Information as set out in the issues embodied in the Pre-Trial Order. The contention of petitioner is well-taken. It is basic that the case of the prosecution in a criminal case depends on the strength of its evidence and not on the weakness of the defense. This is so as proof beyond reasonable doubt is required in criminal cases. Thus, the prosecution must be afforded ample opportunity to present testimonial and documentary evidence to prove its case. A close perusal of the antecedent facts in the instant case shows that the prosecution had not been given this opportunity. The Pre-Trial Order50 of January 19, 1999 shows that the prosecution will present seven (7) witnesses and to resolve the issues on whether petitioner is only a mere employee of or a "5050" partner of respondent. The prosecution was allowed to present only three (3) witnesses, namely, petitioner Jimmy T. Go, Amalia de Leon, representative of CBC, Bohn Briones, representative of and Credit Comptroller of Amsteel Securities, Inc. It must be noted that after petitioner and de Leon presented their testimonies, the trial court ruled that the testimonies of Dee and Lim of the CBC, who were ready to testify, and that of Gloria Padecio, the common-law wife of respondent, were superfluous. Moreover, after much wrangling with the prosecution conceding the non-presentation of the three (3) witnesses, the testimony of Briones was allowed as final witness for the prosecution. But Briones testimony left much to be desired as he was not able to testify on some points the prosecution considered vital to its case. Thus, the prosecution requested for the presentation of Alvin Padecio, the son of respondent and Gloria Padecio, the alleged stock agent of Amsteel Securities, Inc. who handled the transaction involving the subject shares of stock of CBC.

58

This was likewise denied by the trial court, which led to the motion for inhibition and administrative case against Judge Felix, and the adamant stand of petitioner not to rest his case by filing his formal offer of evidence until the testimony of Padecio is had. It must be emphasized that in a catena of cases we have reiterated the principle that the matter of deciding who to present as a witness for the prosecution is not for the defendant or the trial court to decide, as it is the prerogative of the prosecutor.51 It cannot be overemphasized that the trial court must accord full opportunity for the prosecution, more so in criminal cases, to adduce evidence to prove its case and to properly ventilate the issues absent patent showing of dilatory or delaying tactics. The reason is obvious: it is tasked to produce and adduce evidence beyond a reasonable doubt. Sans such evidence, a dismissal of the criminal case on a demurrer to the evidence is proper. In the case at bar, there was no showing that the presentation of the three (3) witnesses previously approved by the trial court would be dilatory and manifestly for delay. The trial court anchored its ruling on the denial of the three (3) witnesses on the fact that the Pre-Trial Order already stipulated the fact that the certificates were issued in the name of petitioner Go, were indorsed in blank and delivered to respondent, and the certificates were subsequently transferred to respondents name. The trial court ruled that these facts were already testified to by petitioner and de Leon. Moreover, the trial court also ruled that the testimony of Gloria Padecio was a superfluity as petitioner already testified to the alleged partnership between petitioner and respondent. We cannot agree with the trial court and neither can we give imprimatur on the appellate courts affirmance thereof. We find that the trial court gravely abused its discretion in denying petitioner and the prosecution to present their witnesses. Grave abuse of discretion implies such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction. It is wellsettled that an act of a court or tribunal may only be considered to have been done in grave abuse of discretion when the act was performed in a capricious or whimsical exercise of judgment which is equivalent to lack of jurisdiction. The abuse of discretion must be so patent and gross as to amount to an evasion of positive duty or to a virtual refusal to perform a duty enjoined or to act at all in contemplation of law, as where the power is exercised in an

arbitrary and despotic manner by reason of passion or personal hostility.52 An error of judgment committed in the exercise of its legitimate jurisdiction is not the same as "grave abuse of discretion." An abuse of discretion is not sufficient by itself to justify the issuance of a writ of certiorari. We find that the trial court gravely abused its discretion in patently and arbitrarily denying the prosecution the opportunity to present four (4) witnesses in the instant criminal case. First, the testimonies of Dee and Lim from CBC would bolster and tend to prove whatever fact the prosecution is trying to establish. Truth to tell, only the testimony of de Leon corroborates petitioners testimony on the alleged transfer from petitioners name to that of respondent of the certificates of stock. More light can be shed on the transaction with the additional testimony of Dee and Lim. Second, the superfluity of a testimony vis--vis what has already been proven can be determined with certainty only after it has been adduced. Verily, the testimonies of petitioner Go and de Leon on the issue of the transfer cannot be said to have truly proven and been corroborated with certainty as they are. Third, the trial court cannot invoke its discretion under Sec. 6 of Rule 134, Rules of Court given that only two (2) witnesses were presented when it denied the testimony of the three (3) witnesses. Sec. 6 of Rule 134 pertinently provides: SEC. 6. Power of the court to stop further evidence. The court may stop the introduction of further testimony upon any particular point when the evidence upon it is already so full that more witnesses to the same point cannot be reasonably expected to be additionally persuasive. But this power should be exercised with caution. The above proviso clearly grants the trial court the authority and discretion to stop further testimonial evidence on the ground that additional corroborative testimony has no more persuasive value as the evidence on that particular point is already so full. Indeed, it was only petitioner Go, whose testimony may be considered selfserving who testified on the issue of the transfer. Certainly, the additional testimony of de Leon on the issue of the transfer cannot be considered as so adequate that additional corroborative testimony has no more persuasive value. Besides, the discretion

59

granted by the above proviso has the clear caveat that this power should be exercised with caution, more so in criminal cases where proof beyond reasonable doubt is required for the conviction of the accused. Fourth, in consonance with the immediate preceding discussion, petitioner Gos testimony on the alleged partnership is not confirmed and supported by any other proof with the exclusion of the testimony of Gloria Padecio. Certainly, it is imperative for the prosecution to prove by clear and strong evidence that the alleged partnership exists; otherwise, respondent Looyuko is entitled to exoneration as the element of trust is important in estafa by abuse of confidence. Corroborative testimony is a necessity given the nature of the criminal case. Likewise, the trial court gravely abused its discretion in denying the prosecution to present the testimony of Alvin Padecio considering that Briones of Amsteel Securities, Inc. did not provide some details on the transfer. Alvin Padecio, petitioner claims, is the person who can shed light on these matters, more particularly if one considers the fact that he is the son of respondent Looyuko. Based on the foregoing findings, we hold that the trial court whimsically, arbitrarily, and gravely abused its discretion amounting to a denial of the prosecution of its day in court. Death of respondent extinguished criminal liability Respondent Looyuko died on October 29, 2004. It is an established principle that the death of the accused pending final adjudication of the criminal case extinguishes the accuseds criminal liability. If the civil liabilitydirectly arose from and is based solely on the offense committed, then the civil liability is also extinguished.53 In the case at bar, the civil liability for the recovery of the CBC stock certificates covering 41,376 shares of stock or their value does not directly result from or based solely on the crime of estafa but on an agreement or arrangement between the parties that petitioner Go would endorse in blank said stock certificates and give said certificates to respondent Looyuko in trust for petitioner for said respondent to sell the stocks covered by the certificates. In such a case, the civil liability survives and an action for recovery therefor in a separate civil action can be instituted either against the executor or administrator or the estate of the accused.

The case law on the matter reads: 1. Corollarily, the claim for civil liability survives notwithstanding the death of the accused, if the same may also be predicated on a source of obligation other than delict. Article 1157of the Civil Code enumerates these other sources of obligation from which the civil liability may arise as a result of the same act or omission: a.) Law b.) Contracts c.) Quasi-contracts d.) x x x e.) Quasi-delicts 2. Where the civil liability survives, as explained in Number 2 above, an action for recover therefore may be pursued but only by way of filing a separate civil action and subject to Section 1, Rule 111 of the 1985 Rules on Criminal Procedure as amended. This separate civil action may be enforced either against the executor/administrator or the estate of the accused, depending on the source of obligation upon which the same is based as explained above.54 (Emphasis supplied.) On the other hand, Sec. 4, Rule 111 of the Rules on Criminal Procedure provides: SEC. 4. Effect of death on civil actions. The death of the accused after arraignment and during the pendency of the criminal action shall extinguish the civil liability arising from the delict. However, the independent civil action instituted under section 3 of this Rule or which thereafter is instituted to enforce liability arising from other sources of obligation may be continued against the estate or legal representative of the accused after proper substitution or against said estate, as the case may be. The heirs of the accused may be substituted for the deceased without requiring the appointment of an executor or administrator and the court may appoint a guardian ad litem for the minor heirs. (Emphasis supplied.)

60

In the light of the foregoing provision, Crim. Case No. 98-1643 has to be dismissed by reason of the death of respondent Looyuko without prejudice to the filing of a separate civil action. One last point. Petitioner Go filed the two petitions before the CA docketed as CA-G.R. SP No. 58639 and CA-G.R. SP No. 62296 involving incidents arising from the proceedings in Crim. Case No. 98-1643. It can be observed from the two petitions that they do not reflect the conformity of the trial prosecutor assigned to said criminal case. This is in breach of Sec. 5, Rule 110 of the Rules of Court that requires that all criminal actions shall be prosecuted "under the direction and control of a public prosecutor." Although in rare occasions, the offended party as a "person aggrieved" was allowed to file a petition under Rule 65 before the CA without the intervention of the Solicitor General,55 the instant petitions before the CA, as a general rule, should be filed by the Solicitor General on behalf of the State and not solely by the offended party.56 For non-compliance with the rules, the twin petitions could have been rejected outright. However, in view of the death of respondent Looyuko, these procedural matters are now mooted and rendered insignificant. G.R. No. 147962 Appellate courts discretion to give due course to petition Petitioner strongly asserts that the CA gravely abused its discretion in failing to dismiss the petition in CA-G.R. SP No. 62438 on the ground of respondents failure to attach all relevant and pertinent documents to his petition, and it erroneously ruled that such procedural defect was cured by admitting respondents motion to admit additional annexes. Petitioner relies on Manila Midtown Hotels and Land Corp., et al. v. NLRC57 and contends that Director of Lands v. Court of Appeals58 cited by the CA is inapplicable. We cannot agree with petitioner.

abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal, nor any plain, speedy, and adequate remedy in the ordinary course of law, a person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered annulling or modifying the proceedings of such tribunal, board or officer, and granting such incidental reliefs as law and justice may require. The petition shall be accompanied by a certified true copy of the judgment, order or resolution subject thereof, copies of all pleadings and documents relevant and pertinent thereto, and a sworn certification of non-forum shopping as provided in the third paragraph of Section 3, Rule 46. The above proviso clearly vests the appellate court the authority and discretion to give due course to the petitions before it or to dismiss the same when it is not sufficient in form and substance, the required pleadings and documents are not attached thereto, and no sworn certificate on non-forum shopping is submitted. And such must be exercised, not arbitrarily or oppressively, but in a reasonable manner in consonance with the spirit of the law. The appellate court should always see to it that justice is served in exercising such discretion. In the case at bar, the appellate court exercised its discretion in giving due course to respondent Looyukos petition in view of the policy of liberality in the application of the rules. Verily, petitioner has not shown that the appellate court abused its discretion in an arbitrary or oppressive manner in not dismissing the petition due to the non-attachment of some relevant pleadings to the petition. The miscue was cured when respondent submitted additional annexes to the petition. Neither has petitioner shown any manifest bias, fraud, or illegal consideration on the part of the appellate court to merit reconsideration for the grant of due course. Respondent guilty of forum shopping There was still a pending Motion for Reconsideration (to the Order of denial of Looyukos Motion to Dismiss) filed by Looyuko in the court a quo when he instituted the petition before the CA on January 2, 2001. It is aggravated by the fact that the Motion for Reconsideration to the denial Order was filed on the same day or simultaneously with the filing

Sec. 1 of Rule 65 pertinently provides: SECTION 1. Petition for certiorari. When any tribunal, board or officer exercising judicial or quasi-judicial functions has acted without or in excess of its or his jurisdiction, or with grave

61

of the Petition for Certiorari; hence, the petition is in the nature of forum shopping. The issues brought before the CA are similar to the issues raised in Looyukos Motion for Reconsideration involving similar cause of action and reliefs sought, that is, to dismiss the basic complaint of petitioner Go. This Court in a catena of cases resolved that a Motion for Reconsideration is an adequate remedy in itself, and is a condition sine qua nonto the prosecution of the independent, original, and extra ordinary special civil action of certiorari. 59 We must not lose sight of the fact that a Motion for Reconsideration (subsequently denied) is a prerequisite before a Petition for Certiorari may properly be filed.60 Considering, that the Motion for Reconsideration has not been resolved by the court a quo, the petition (CA-G.R. SP No. 62438) was prematurely filed; hence, it should have been outrightly denied due course. Looyuko was remiss of his duty to inform the appellate court in his petition that there was a pending Motion for Reconsideration in the court a quo. Consummated injunctive writ acts not restrained by

it is a universal principle of law that an injunction will not issue to restrain the performance of an act already done. This is so, for the simple reason that nothing more can be done in reference thereto.63 A writ of injunction becomes moot and academic after the act sought to be enjoined has already been consummated.64 In the case at bar, it is manifest that the inventory has already been conducted when the January 8, 2001 TRO and February 12, 2001 Writ of Injunction were issued. Thus, the issue of injunction has been mooted, and the injunctive writ must be nullified and lifted. Inventory of assets does not prejudice the parties Moreover, it must be noted that the inventory of assets granted by the trial court on December 29, 2000, which was completed on January 5, 2001, does not prejudice respondent Looyukos right. Certainly, the rights of respondent over the inventoried assets in Noahs Ark Sugar Refinery have not been transgressed, set aside, diminished, or militated upon by the conduct of the inventory. An inventory does not confer any rights. Thus, by conducting the inventory, petitioner had not been conferred any rights over the assets absent a final determination by the court on the main action for specific performance, accounting, and damages, as the inventory is only an ancillary remedy preparatory for the party to an action to institute other legal remedies for the protection of whatever right the party may have over the subject of the inventory. Injunction, therefore, against the inventory of the assets covered by the December 29, 2000 Order should be lifted since the inventory has been completed and there is nothing to enjoin or restrain. Consequently, the February 12, 2001 CA Resolution on this matter will have to be modified. Lower court to proceed absent any TRO or injunctive writ from this Court With regard to the injunction on the September 25, 2000 and December 19, 2000 Orders which denied respondents motion to dismiss and motion for reconsideration, respectively, which effectively prohibited the Pasig City RTC from conducting further proceedings in Civil Case No. 67921 until CA-G.R. SP No. 62438 is resolved, it is clear that more than six (6) years had elapsed since the April 24, 2001 CA Resolution

A close review of the antecedent facts bears out that, indeed, petitioner did not know of the petition for certiorari before the CA until he received a copy of the CAs January 8, 2001 Resolution on January 12, 2001. It is undisputed that petitioner received a copy of respondents December 29, 2000 petition only on January 19, 2001. Clearly, petitioner did not yet know of the pendency of the petition for certiorari before the CA when the inventory of the assets in Noahs Ark Sugar Refinery was completed on January 5, 2001. Thus, the appellate court committed reversible error when it held that petitioner proceeded at his own peril the conduct of the inventory in view of the pendency of the certiorari case in which the appellate court enjoined the trial court from proceeding with its January 8, 2001 Resolution. Verily, even before the CA granted the TRO and issued its January 8, 2001 Resolution, the proceeding to be enjoined, that is, the conduct of the inventory, had already been done. Thus, we agree with petitioner that Verzosa v. Court of Appeals61 relied upon by the appellate court is not applicable. The established principle is that when the events sought to be prevented by injunction or prohibition have already happened, nothing more could be enjoined or prohibited. 62 Indeed,

62

was issued and still the CA petition of petitioner has not yet been resolved on the merits. It is observed that this Court did not issue a TRO or a writ of preliminary injunction against the CA from proceeding in CA-G.R. SP No. 62438. The CA should have proceeded to resolve the petition notwithstanding the pendency of G.R. No. 147962 before this Court. This is unequivocal from Sec. 7 of Rule 65 which provides that the "petition shall not interrupt the course of the principal case unless a TRO or a writ of preliminary injunction has been issued against the public respondent from further proceeding in the case." This rule must be strictly adhered to by the lower court notwithstanding the possibility that the proceedings undertaken by the lower court tend to or would render nugatory the pending petition before this Court. As long as there is no directive from this Court for the lower court to defer action in the case, the latter would not be faulted if it continues with the proceedings in said case. Given the more than six (6) years that CA-G.R. SP No. 62438 has been pending with the CA, we deem it better to resolve the issue of the propriety of the denial by the trial court of respondents motion to dismiss than remanding it to the CA. Issue of denial of motion to dismiss Respondent Looyuko anchored his motion to dismiss on the ground of forum shopping, litis pendentia, and abandonment or laches. Respondent anchors his grounds of litis pendentia and forum shopping on the fact of the pendency of Civil Case No. 98-91153 entitled Alberto T. Looyuko v. Jimmy T. Go a.k.a. Jaime Gaisano and the Register of Deeds of Manila before the Manila RTC, Branch 36, and in Civil Case No. MC 98-038 entitled Alberto T. Looyuko v. Jimmy T. Go a.k.a. Jaime Gaisano and the Register of Deeds of Mandaluyong City before Mandaluyong City RTC, Branch 213. Civil Case No. 98-91153 involves an action to amend Transfer Certificate of Title (TCT) Nos. 160277 and 160284 by deleting the name of petitioner Jimmy T. Go as co-owner. While Civil Case No. MC 98-038 is a petition to cancel the adverse claims annotated by petitioner in TCT No. 64070 in the name of respondent Alberto T. Looyuko and in TCT No. 3325 in the name of Noahs Ark Sugar Refinery. In both civil cases, petitioner has anchored his defense and adverse claims on the Agreements executed on February 9, 1982 and October 10, 1986, wherein the parties allegedly entered into and embodied in said agreements their true intent and relationship with respect to their business

ventures in Noahs Ark Group of Companies, that is, for convenience and expediency, the parties agreed to have their ventures registered with the DTI in the name of respondent Looyuko only as sole proprietor while they are both equally entitled to 50% of the business, goodwill, profits, real and personal properties owned by the group of companies. Respondent pointed out that that petitioner has prayed in Civil Case No. 98-91153 that the parties agreement dated February 9, 1982 and October 10, 1986 be declared valid and binding, and in Civil Case No. MC 98-038 to order the Register of Deeds of Mandaluyong City to register petitioner Gos name as co-owner of the properties covered by TCT Nos. 64070 and 3325 by virtue of the February 9, 1982 and October 10, 1986 agreements. Thus, respondent strongly argues that the issue regarding the validity and binding effect of the alleged partnership agreements dated February 9, 1982 and October 10, 1986 on which petitioner anchors his claim of co-ownership in the Noahs Ark Group of Companies has been squarely raised not only as a defense but also as basis of his prayer for positive relief. Respondent now contends that petitioner is barred by litis pendentia in filing Civil Case No. 67921 for Specific Performance, Accounting, Inventory of Assets and Damages anchored on the same issue of the disputed partnership agreements. Moreover, such filing duly recognized by the trial court constitutes forum shopping. We cannot agree with respondent. Litis pendentia and forum shopping not present There is no basis for respondents claim based on litis pendentia and forum shopping. For litis pendentia to be a ground for the dismissal of an action there must be: (1) identity of the parties or at least such as to represent the same interest in both actions; (2) identity of rights asserted and relief prayed for, the relief being founded on the same acts; and (3) the identity in the two cases should be such that the judgment which may be rendered in one would, regardless of which party is successful, amount to res judicata in the other.65 On the other hand, forum shopping exists where the elements of litis pendentia are present, and where a final judgment in one case will amount to res judicata in the other.66 A brief perusal of the cause of action in Civil Case No. 67921 vis--vis those of Civil Case

63

Nos. 98-91153 and MC 98-038 reveals that there is neither identity of rights asserted and reliefs prayed for, nor are the reliefs founded on the same acts. In this case, Civil Case No. 67921, the relief sought before the Pasig City RTC where the complaint for specific performance was filed by petitioner, was the enforcement of the disputed partnership agreements, whereas, in the Makati City and Mandaluyong City RTCs, the reliefs sought by petitioner who is a defendant and respondent, respectively, were merely as defense for his coownership over subject parcels of land and as defense for the adverse claims he had annotated in the titles of subject properties. Such defenses cannot be equated with seeking relief for the enforcement of the disputed partnership agreements. Indeed, the complaint and petition filed by respondent in the Makati City and Mandaluyong City RTCs had different causes of action and sought different reliefs which did not stem from nor are founded from the same acts complained of. There is no basis, therefore, for petitioners contention that respondent is guilty of forum shopping nor the instant complaint barred by litis pendentia. Anent abandonment or laches, we fully agree with the trial court that there is no basis to dismiss the complaint in Civil Case No. 67921 on the grounds of laches and abandonment. Laches, being controlled by equitable considerations and addressed to the sound discretion of the trial court, is evidentiary in nature and thus can not be resolved in a motion to dismiss, as we have held in the fairly recent case of Felix Gochan and Sons Realty Corporation v. Heirs of Raymundo Baba.67 WHEREFORE, the petition in G.R. No. 147962 is GRANTED. The February 12, 2001 and April 24, 2001 Resolutions of the CA in CAG.R. SP No. 62438 are REVERSED and SET ASIDE, and the Writ of Preliminary Injunction is LIFTED. The Petition for Certiorari of respondent Looyuko in CA-G.R. SP No. 62438 is DISMISSEDfor lack of merit, and the Orders dated September 25, 2000, December 19, 2000, and December 29, 2000 of the Pasig City RTC, Branch 69 are AFFIRMED. The Pasig City RTC, Branch 69 is hereby ordered to proceed with the case with dispatch. The petition in G.R. No. 147923 is DENIED and the September 11, 2000 Decision and March 27, 2001 Resolution of the CA in CA-G.R. SP No. 58639 are AFFIRMED. The petition in G.R. No. 154035 is GRANTED. The January 31, 2002 Decision and June 3, 2002 Resolution of the CA in CA-G.R. SP No. 62296 are REVERSED and SET ASIDE. Likewise, the

Orders dated May 9, 2000 and September 22, 2000 of the Makati City RTC in Crim. Case No. 98-1643 are REVERSED and SET ASIDE. However, in view of the demise of respondent Looyuko on October 29, 2004, the Makati City RTC is ordered to dismiss Crim. Case No. 981643 without prejudice to the filing of a separate civil action by petitioner Go. No pronouncement as to costs. SO ORDERED. G.R. No. 186382 April 5, 2010

PEOPLE OF THE PHILIPPINES, PlaintiffAppellee, vs. DOMINGO PANITERCE, Accused-Appellant. RESOLUTION LEONARDO-DE CASTRO, J.: Before Us is an appeal filed by Domingo Paniterce y Martinez (Paniterce) assailing the Decision1 dated August 22, 2008 of the Court of Appeals in CA-G.R. CR-H.C. No. 01001, entitled People of the Philippines v. Domingo Paniterce," which affirmed with modification the Decision dated March 2, 2005 of the Regional Trial Court (RTC) of Iriga City, Branch 37, in Criminal Case Nos. 6076, 6077, 6078, 6079, 6080 and 6081.2 The RTC found Paniterce guilty beyond reasonable doubt of the crimes of Rape and Acts of Lasciviousness. In four Informations, all dated February 11, 2002, 4th Assistant Provincial Prosecutor Hedy S. Aganan charged Paniterce with four counts of rape of his daughter AAA. Except for the dates3 of the commission of the rapes, the four Informations identically read: Criminal Case Nos. 6076, 6077, 6078 and 6079 That sometime in the year 1997 in x x x Philippines and within the jurisdiction of this Honorable Court, the above-named accused, with grave abuse of confidence being the father of the offended party with lewd designs by means of force and intimidation, did then and there willfully, unlawfully and feloniously succeed in having carnal knowledge with his daughter AAA, a 10 year-old minor, against her will and without her consent, to her damage and prejudice in such amount as may be awarded by the Honorable Court.4 In two Amended Informations, both dated December 3, 2002, Assistant Provincial

64

Prosecutor Daniel M. Salvadora charged Paniterce with two counts of rape of his other daughter BBB. Aside from the dates 5 of the commission of the rapes, the Informations similarly state: Criminal Case Nos. 6080 and 6081 That on or about 6:00 oclock in the morning of August 26, 2000 x x x Philippines, and within the jurisdiction of this Honorable Court, the above-named accused, with grave abuse of confidence being the father of the offended party with lewd designs by means of force and intimidation, did then and there willfully, unlawfully and feloniously committed RAPE upon his 12- year old daughter BBB by then and there, caressing and inserting his finger inside her vagina against her will and without her consent, to her damage and prejudice in such amount as may be awarded by the Honorable Court.6 When arraigned, Paniterce pleaded not guilty to all the charges. After trial on the merits, the RTC rendered a Decision on March 2, 2005, with the following dispositive portion: WHEREFORE, in view of all the foregoing, the prosecution having proved the guilt of accused Domingo Paniterce of the crimes of Rape as charged in the aforementioned Informations, he is hereby sentenced to suffer the penalties of imprisonment, to wit: In Criminal Case No. 6076, he is hereby sentenced to suffer the penalty of imprisonment ranging from FOUR (4) MONTHS and ONE (1) DAY of arresto mayor as minimum to FOUR (4) YEARS, TWO (2) MONTHS AND ONE (1) DAY of prision correccional as maximum for Acts of Lasciviousness under Article 336 of the Revised Penal Code as the alleged molestation took place in April 1997 and RA 8353 took effect only on October 22, 1997; In Criminal Cases Nos. 6077, 6078, 6080 and 6081, he is hereby sentenced to suffer in each every case the penalty of imprisonment ranging from FOUR (4) YEARS, TWO (2) MONTHS and ONE (1) DAY of prision correccional as minimum to EIGHT (8) YEARS and ONE (1) DAY of prision mayor as maximum and to pay AAA and BBB Fifty Thousand Pesos (P50,000.00) each as moral damages and Fifty Thousand Pesos (P50,000.00) as exemplary damages; In Criminal Case No. 6079, he is hereby sentenced to suffer the penalty of DEATH and to

pay AAA the amount of Fifty Thousand Pesos (P50,000.00) as moral damages and Fifty Thousand Pesos (P50,000.00) as exemplary damages.7 On June 4, 2005, Paniterce was committed to the Bureau of Corrections in Muntinlupa City. Paniterce filed an appeal with the Court of Appeals, which was docketed as CA-G.R. CRH.C. No. 01001. The appellate court rendered a Decision on August 22, 2008 affirming the RTC judgment with modifications, to wit: WHEREFORE, the Decision of the trial court convicting DOMINGO PANITERCE is hereby AFFIRMED with the following modifications: 1. For Acts of Lasciviousness, in Criminal Cases Nos. 6077, 6078, 6080 and 6081, appellant is hereby sentenced to suffer in each [and] every case an indeterminate prison term of six (6) months of arresto mayor, as minimum, to six (6) years of prision correccional, as maximum and to pay AAA and BBB Fifty Thousand Pesos (P50,000.00) each as moral damages and Fifty Thousand Pesos (P50,000.00) as exemplary damages; and 2. For Rape, in Criminal Case No. 6079, appellant is hereby sentenced to suffer the penalty of Reclusion Perpetua and to pay AAA the amount of Fifty Thousand Pesos (P50,000.00) as moral damages and Fifty Thousand Pesos (P50,000.00) as exemplary damages. The decision of the trial court finding appellant guilty for Acts of Lasciviousness in Criminal Case No. 6076 is AFFIRMED without any modification.8 On 16 September 2008, Paniterce, through counsel, filed a Notice of Appeal with the Court of Appeals conveying his intention to appeal to us the aforementioned Decision dated August 22, 2008 of the appellate court. The Court of Appeals gave due course to Paniterces Notice of Appeal on September 23, 2008, 9 and directed its Judicial Records Division to elevate to us the original records in CA-G.R. CR-H.C. No. 01001. On 15 April 2009, we required10 the parties to file their supplemental briefs, and the Director of the Bureau of Corrections to confirm the commitment of Paniterce at the Bureau of Corrections and submit his report thereon within 10 days from notice.

65

Paniterce filed his Supplemental Brief 11 on June 16, 2009, while the Office of the Solicitor General filed a Manifestation 12 on June 18, 2009 stating that it would no longer file a supplemental brief considering that Paniterce did not raise any new issue in his appeal. On July 22, 2009, we submitted G.R. No. 186382 for resolution. However, in a letter dated October 12, 2009, Julio A. Arciaga, the Assistant Director for Prisons and Security of the Bureau of Corrections, informed us that Paniterce had died on August 22, 2009 at the New Bilibid Prison Hospital. Paniterces Death Certificate was attached to said letter. Given Paniterces death, we are now faced with the question of the effect of such death on the present appeal. Paniterces death on August 22, 2009, during the pendency of his appeal, extinguished not only his criminal liabilities for the rape and acts of lasciviousness committed against his daughters, but also his civil liabilities solely arising from or based on said crimes.1awphi1 According to Article 89(1) of the Revised Penal Code, criminal liability is totally extinguished: 1. By the death of the convict, as to the personal penalties; and as to pecuniary penalties, liability therefor is extinguished only when the death of the offender occurs before final judgment. Applying the foregoing provision, we laid down the following guidelines in People v. Bayotas 13: 1. Death of the accused pending appeal of his conviction extinguishes his criminal liability as well as the civil liability based solely thereon. As opined by Justice Regalado, in this regard, "the death of the accused prior to final judgment terminates his criminal liability and only the civil liability directly arising from and based solely on the offense committed, i.e., civil liability ex delicto in senso strictiore." 2. Corollarily, the claim for civil liability survives notwithstanding the death of (the) accused, if the same may also be predicated on a source of obligation other than delict. Article 1157 of the Civil Code enumerates these other sources of obligation from which the civil liability may arise as a result of the same act or omission:

a) Law b) Contracts c) Quasi-contracts xxxx e) Quasi-delicts 3. Where the civil liability survives, as explained in Number 2 above, an action for recovery therefor may be pursued but only by way of filing a separate civil action and subject to Section 1, Rule 111 of the 1985 Rules on Criminal Procedure as amended. This separate civil action may be enforced either against the executor/administrator or the estate of the accused, depending on the source of obligation upon which the same is based as explained above. 4. Finally, the private offended party need not fear a forfeiture of his right to file this separate civil action by prescription, in cases where during the prosecution of the criminal action and prior to its extinction, the privateoffended party instituted together therewith the civil action. In such case, the statute of limitations on the civil liability is deemed interrupted during the pendency of the criminal case, conformably with the provisions of Article 1155 of the Civil Code that should thereby avoid any apprehension on a possible privation of right by prescription.14 Clearly, it is unnecessary for the Court to rule on Paniterces appeal. Whether or not he was guilty of the crimes charged has become irrelevant since, following Article 89(1) of the Revised Penal Code and our disquisition in Bayotas, even assuming Paniterce had incurred criminal liabilities, they were totally extinguished by his death. Moreover, because Paniterces appeal was still pending and no final judgment of conviction had been rendered against him when he died, his civil liabilities arising from the crimes, being civil liabilities ex delicto, were likewise extinguished by his death. Consequently, the appealed Decision dated August 22, 2008 of the Court of Appeals finding Paniterce guilty of rape and acts of lasciviousness, sentencing him to imprisonment, and ordering him to indemnify his victims had become ineffectual. WHEREFORE, in view of the death of accusedappellant Domingo Paniterce y Martinez, the Decision dated August 22, 2008 of the Court of Appeals in CA-G.R. CR-H.C. No. 01001 is SET

66

ASIDE and Criminal Case Nos. 6076, 6077, 6078, 6079, 6080, and 6081 before the Regional Trial Court of Iriga City are DISMISSED. Costs de oficio. SO ORDERED. G.R. Nos. 159017-18 2011 March 9,

of twenty (20) years beginning on 15 March 1978 until 15 March 1998, extendible for another 20 years.8 The lease contract provided that the late Vda. De Coronado could build a firewall on her rented property which must be at least as high as the store; and in case of modification of the public market, she or her heir/s would be given preferential rights. Visitacion took over the store when her mother died sometime in 1984.9 From then on up to January 1993, Visitacion secured the yearly Mayors permits.10 Sometime in 1986, a fire razed the public market of Nagcarlan. Upon Visitacions request for inspection on 15 May 1986, District Engineer Marcelino B. Gorospe (Engineer Gorospe) of the then Ministry of Public Works and Highways,11 Regional Office No. IV-A, found that the store of Visitacion remained intact and stood strong. This finding of Engineer Gorospe was contested by the Municipality of Nagcarlan. The store of Visitacion continued to operate after the fire until 15 October 1993. On 1 September 1993, Visitacion received a letter12 from Mayor Comendador directing her to demolish her store within five (5) days from notice. Attached to the letter were copies of Sangguniang Bayan Resolution No. 15613dated 30 August 1993 and a Memorandum issued by Asst. Provincial Prosecutor Marianito Sasondoncillo of Laguna. The relevant provisos of the Resolution No. 156 states that: NOW THEREFORE, be it RESOLVED, as it hereby resolved to authorize Hon. Demetrio T. Comendador to enforce and order the Coronados to demolish the building constructed on the space previously rented to them in order to give way for the construction of a new municipal market building. RESOLVED FURTHER, to authorize Demetrio T. Comendador, Honorable Mayor of Nagcarlan to file an Unlawful Detainer Case with damages for the expenses incurred due to the delay in the completion of the project if the Coronados continuously resists the order. On 3 September 1993, Visitacion wrote a reply letter to Mayor Comendador saying that: (1) the lease contract was still existing and legally binding; (2) she was willing to vacate the store as long as same place and area would be given

PAULINO S. ASILO, JR., Petitioner, vs. THE PEOPLE OF THE PHILIPPINES and Spouses VISITACION AND CESAR C. BOMBASI, Respondents. x - - - - - - - - - - - - - - - - - - - - - - -x G.R. No. 159059 VICTORIA BUETA VDA. DE COMENDADOR, IN REPRESENTATION OF DEMETRIO T. COMENDADOR,Petitioner, vs. VISITACION C. BOMBASI AND CESAR C. BOMBASI, Respondents. DECISION PEREZ, J.: At bench are appeals by certiorari 1 from the Decision2 of the Fourth Division of the Sandiganbayan; (1) finding Demetrio T. Comendador3 (Mayor Comendador) and Paulino S. Asilo, Jr.4 guilty beyond reasonable doubt of violation of Sec. 3(e) of Republic Act No. 3019; (2) dismissing the cases against accused Alberto S. Angeles;5 (3) ordering the defendants Municipality of Nagcarlan, Laguna, Demetrio T. Comendador and Paulino S. Asilo, Jr. to pay the plaintiffs now respondents Visitacion C. Bombasi (Visitacion) and Cesar C. Bombasi damages; and (4) dismissing the cases against the spouses Alida and Teddy Coroza 6 and Benita and Isagani Coronado.7 The factual antecedents of the case are: On 15 March 1978, Private Respondent Visitacions late mother Marciana Vda. De Coronado (Vda. De Coronado) and the Municipality of Nagcarlan, Laguna (represented by the then Municipal Mayor Crisostomo P. Manalang) entered into a lease contract whereby the Municipality allowed the use and enjoyment of property comprising of a lot and a store located at the corner of Coronado and E. Fernandez Sts. at Poblacion, Nagcarlan, Laguna, in favor of the respondents mother for a period

67

to her in the new public market; and (3) in case her proposals are not acceptable to Mayor Comendador, for the latter to just file an unlawful detainer case against her pursuant to Sangguniang Bayan Resolution No. 156. Pertinent portions of the letter read: x x x With all due respect to the resolution of the Municipal Council and the opinion rendered by the Laguna Asst. Provincial Prosecutor, it is my considered view, however, arrived at after consultation with my legal counsel, that our existing lease contract is still legally binding and in full force and effect. Lest I appear to be defiant, let me reiterate to you and the council that we are willing to vacate the said building provided that a new contract is executed granting to us the same space or lot and the same area. I believe that our proposal is most reasonable and fair under the circumstance. If you are not amenable to the said proposal, I concur with the position taken by the Council for you to file the appropriate action in court for unlawful detainer to enable our court to finally thresh out our differences.141avvphi1 On 15 September 1993, Asst. Provincial Prosecutor Florencio Buyser sent a letter to Visitacion ordering her to vacate the portion of the public market she was occupying within 15 days from her receipt of the letter; else, a court action will be filed against her. On 11 October 1993, the Sangguniang Bayan of Nagcarlan, Laguna issued Resolution No. 183 authorizing Mayor Comendador to demolish the store being occupied by Visitacion using legal means. The significant portion of the Resolution reads: Kung kaya ang Sangguniang Bayan ay buong pagkakaisang IPINASIYA: Ang pagbibigay kapangyarihan kay Kgg. Demetrio T. Comendador na ipagiba ang anumang istrakturang nagiging sagabal sa mabilis at maayos na pagbabangon ng pamilihang bayan.15 On 14 October 1993, Municipal Administrator Paulino S. Asilo, Jr. (Asilo) also sent a letter 16 to Visitacion informing her of the impending demolition of her store the next day. Within the same day, Visitacion wrote a reply letter17 to Asilo, alleging that there is no legal right to demolish the store in the absence of a court order and that the Resolutions did not sanction the demolition of her store but only the filing of an appropriate unlawful detainer case against her. She further replied that if the demolition will take place, appropriate administrative, criminal and civil actions will be filed against

Mayor Comendador, Asilo and all persons who will take part in the demolition. On 15 October 1993, Mayor Comendador relying on the strength of Sangguniang Bayan Resolution Nos. 183 and 156 authorized the demolition of the store with Asilo and Angeles supervising the work. Engineer Winston Cabrega (Engineer Cabrega), a licensed civil engineer, estimated the cost of the demolished property as amounting to P437,900.0018 On 19 August 1994, Visitacion, together with her husband Cesar Bombasi (Spouses Bombasi) filed with the Regional Trial Court of San Pablo City, Laguna a Civil Case19 for damages with preliminary injunction against the Municipality of Nagcarlan, Laguna, Mayor Demetrio T. Comendador, Paulino S. Asilo, Jr., and Alberto S. Angeles. The complaint was soon after amended to include the Spouses Benita and Isagani Coronado and Spouses Alida and Teddy Coroza as formal defendants because they were then the occupants of the contested area.

The spouses disposition:

prayed

for

the

following

1. RESTRAINING or ENJOINING defendant Municipality and defendant Municipal Mayor from leasing the premises subject of lease Annex "A" hereof, part of which is now occupied by PNP Outpost and by the Municipal Collectors Office, and the equivalent adjacent area thereof, and to cause the removal of said stalls; 2. UPHOLDING the right of plaintiffs to occupy the equivalent corner area of the leased areas being now assigned to other persons by defendants Municipality and/or by defendant Municipal Mayor, and to allow plaintiffs to construct their stalls thereon; 3. MAKING the injunction permanent, after trial; 4. ORDERING defendants to pay plaintiffs, jointly and severally, the following (a) P437,900.00 for loss of building/store and other items therein;

68

(b) P200,000.00 damages; (c) P200,000.00 damages;

for

exemplary

for

moral

(d) P30,.00 for attorneys fees and P700.00 for every attendance of counsel in court. 5. GRANTING further reliefs upon plaintiffs as justice and equity may warrant in the premises.20 Spouses Bombasi, thereafter, filed a criminal complaint21 against Mayor Comendador, Asilo and Angeles for violation of Sec. 3(e) of Republic Act No. 3019 otherwise known as the "Anti-Graft and Corrupt Practices Act" before the Office of the Ombudsman. On 22 February 1996, an Information22 against Mayor Comendador, Asilo and Angeles was filed, which reads: That on or about October 15, 1993, at Nagcarlan, Laguna, Philippines, and within the jurisdiction of this Honorable Court, the abovenamed accused, all public officers, accused Demetrio T. Comendador, being then the Municipal Mayor, accused Paulino S. Asilo, Jr. being then the Municipal Administrator and accused Alberto S. Angeles being then the Municipal Planning and Development Coordinator, all of the Municipality of Nagcarlan, Laguna, committing the crime herein charged in relation to, while in the performance and taking advantage of their official functions, conspiring and confederating with each other, and with evident bad faith, manifest partiality or through gross inexcusable negligence, did then and there willfully, unlawfully, criminally cause the demolition of a public market stall leased by the municipal government in favor of one Visitacion Coronado-Bombasi without legal or justifiable ground therefor, thus, causing undue injury to the latter in the amount of PESOS: FOUR HUNDRED THIRTY SEVEN THOUSAND AND NINE HUNDRED ONLY (P437,900.00). Upon their arraignments, all the accused entered their separate pleas of "Not Guilty." On 4 March 1997, the Sandiganbayan promulgated a Resolution ordering the consolidation of Civil Case No. SP-4064 (94)23 with Criminal Case No. 23267 pending before the Third Division pursuant to Section 4, Presidential Decree No. 1606, which pertinently reads:

Any provision of law or Rules of Court to the contrary notwithstanding, the criminal action and the corresponding civil action for the recovery of civil liability arising from the offense charged shall at all times be simultaneously instituted with, and jointly determined in the same proceeding by the Sandiganbayan or the appropriate courts, the filing of the criminal action being deemed to necessarily carry with it the filing of the civil action, and no right to reserve the filing of such civil action separately from the criminal action shall be recognized; Provided, however, that where the civil action had heretofore been filed separately but judgment therein has not yet been rendered, and the criminal case is hereafter filed with the Sandiganbayan or the appropriate court, said civil action shall be transferred to the Sandiganbayan or the appropriate court as the case may be, for consolidation and joint determination with the criminal action, otherwise the separate civil action shall be deemed abandoned.24 During the pendency of the case, Alberto S. Angeles died on 16 November 1997. Accordingly, the counsel of Angeles filed a motion to drop accused Angeles. On 22 September 1999, the Third Division of Sandiganbayan issued an Order25 DISMISSING the case against Angeles. The germane portion of the Order reads: In view of the submission of the death certificate of accused/defendant Alberto S. Angeles, and there being no objection on the part of the Public Prosecutor, cases against deceased accused/defendant Angeles only, are hereby DISMISSED. The death of Mayor Comendador followed on 17 September 2002. As a result, the counsel of the late Mayor filed on 3 March 2003 a Manifestation before the Sandiganbayan informing the court of the fact of Mayor Comendadors death. On 28 April 2003, the Sandiganbayan rendered a decision, the dispositive portion of which reads as follows: WHEREFORE, premises considered, judgment is hereby rendered as follows: In Criminal Case No. 23267, the court finds accused Demetrio T. Comendador and Paulino S. Asilo, Jr. guilty beyond reasonable doubt of violation of Sec. 3(e) of Republic Act. No. 3019 as amended, and in the absence of aggravating and mitigating circumstances, applying the Indeterminate Sentence Law, said accused are

69

sentenced to suffer the indeterminate penalty of 6 years and 2 months imprisonment as minimum to 10 years and 1 day as maximum. The order of the court dated September 22, 1999 dismissing the cases against the accused Alberto S. Angeles, who died on November 16, 1997 is hereby reiterated. In Civil Case No. 4064, defendants Municipality of Nagcarlan, Laguna, Demetrio T. Comendador and Paulino S. Asilo, Jr. are hereby ordered jointly and severally to pay plaintiff P437,900.00 as actual damages for the destruction of the store; P100,000.00 as moral damages; P30,000.00 as attorneys fees, and to pay the cost of the suit. The prayer for exemplary damages is denied as the court found no aggravating circumstances in the commission of the crime. In view of this courts finding that the defendant spouses Alida and Teddy Coroza are lawful occupants of the subject market stalls from which they cannot be validly ejected without just cause, the complaint against them is dismissed. The complaint against defendant spouses Benita and Isagani Coronado is likewise dismissed, it appearing that they are similarly situated as the spouses Coroza. Meanwhile, plaintiff Visitacion Bombasi is given the option to accept market space being given to her by the municipality, subject to her payment of the appropriate rental and permit fees. The prayer for injunctive relief is denied, the same having become moot and academic. The compulsory counterclaim of defendant Comendador is likewise denied for lack of merit.26 Within the same day, Asilo, through his counsel, filed a Motion for Reconsideration 27 of the Decision alleging that there was only an error of judgment when he complied with and implemented the order of his superior, Mayor Comendador. He likewise alleged that there is no liability when a public officer commits in good faith an error of judgment. The Sandiganbayan, on its Resolution28 dated 21 July 2003 denied the Motion for Reconsideration on the ground that good faith cannot be argued to support his cause in the face of the courts finding that bad faith attended the commission of the offense charged. The Court further explained that the invocation of compliance with an order of a superior is of no moment for the "demolition [order] cannot be described as having the semblance of legality inasmuch as it

was issued without the authority and therefore the same was patently illegal."29 The counsel for the late Mayor also filed its Motion for Reconsideration30 on 12 May 2003 alleging that the death of the late Mayor had totally extinguished both his criminal and civil liability. The Sandiganbayan on its Resolution31 granted the Motion insofar as the extinction of the criminal liability is concerned and denied the extinction of the civil liability holding that the civil action is an independent civil action. Hence, these Certiorari.32 Petitions for Review on

Petitioner Asilo argues that in order to sustain conviction under Sec. 3(e) of Republic Act No. 3019 or "The Anti-Graft and Corrupt Practices Act," the public officer must have acted with manifest partiality, evident bad faith or gross negligence. He also contended that he and his co-accused acted in good faith in the demolition of the market and, thereby, no liability was incurred. On the other hand, Petitioner Victoria argues that the death of Mayor Comendador prior to the promulgation of the decision extinguished NOT ONLY Mayor Comendadors criminal liability but also his civil liability. She also asserted good faith on the part of the accused public officials when they performed the demolition of the market stall. Lastly, she contended that assuming arguendo that there was indeed liability on the part of the accused public officials, the actual amount of damages being claimed by the Spouses Bombasi has no basis and was not duly substantiated. Liability of the accused under Republic Act No. 3019 public officials

Section 3(e) of Republic Act No. 3019 provides: In addition to acts or omissions of public officers already penalized by existing law, the following shall constitute corrupt practices of any public officer and are hereby declared to be unlawful: xxxx (e) Causing any undue injury to any party, including the Government, or giving any private party any unwarranted benefits, advantage or preference in the discharge of his official, administrative or judicial functions throughmanifest partiality, evident bad faith or gross inexcusable negligence. This provision shall apply to officers and employees

70

of offices or government corporations charged with the grant of licenses or permits or other concessions. The elements of the offense are as follows: (1) that the accused are public officers or private persons charged in conspiracy with them; (2) that said public officers commit the prohibited acts during the performance of their official duties or in relation to their public positions; (3) that they caused undue injury to any party, whether the Government or a private party; (4) OR that such injury is caused by giving unwarranted benefits, advantage or preference to the other party; and (5) that the public officers have acted with manifest partiality, evident bad faithor gross inexcusable negligence.33 We sustain the Sandiganbayan in its finding of criminal and civil liabilities against petitioner Asilo and petitioner Mayor Comendador as here represented by his widow Victoria Bueta. We agree with the Sandiganbayan that it is undisputable that the first two requisites of the criminal offense were present at the time of the commission of the complained acts and that, as to the remaining elements, there is sufficient amount of evidence to establish that there was an undue injury suffered on the part of the Spouses Bombasi and that the public officials concerned acted with evident bad faith when they performed the demolition of the market stall. Causing undue injury to any party, including the government, could only mean actual injury or damage which must be established by evidence.34 In jurisprudence, "undue injury" is consistently interpreted as "actual." Undue has been defined as "more than necessary, not proper, [or] illegal;" and injury as "any wrong or damage done to another, either in his person, rights, reputation or property [that is, the] invasion of any legally protected interest of another." Actual damage, in the context of these definitions, is akin to that in civil law.35 It is evident from the records, as correctly observed by the Sandiganbayan, that Asilo and Mayor Comendador as accused below did not deny that there was indeed damage caused the Spouses Bombasi on account of the demolition. We affirm the finding that: xxx. Clearly, the demolition of plaintiffs store was carried out without a court order, and notwithstanding a restraining order which the

plaintiff was able to obtain. The demolition was done in the exercise of official duties which apparently was attended by evident bad faith, manifest partiality or gross inexcusable negligence as there is nothing in the two (2) resolutions which gave the herein accused the authority to demolish plaintiffs store. "Evident bad faith" connotes not only bad judgment but also palpably and patently fraudulent and dishonest purpose to do moral obliquity or conscious wrongdoing for some perverse motive or ill will.36 [It] contemplates a state of mind affirmatively operating with furtive design or with some motive or selfinterest or ill will or for ulterior purposes. 37 It is quite evident in the case at bar that the accused public officials committed bad faith in performing the demolition. First, there can be no merit in the contention that respondents structure is a public nuisance. The abatement of a nuisance without judicial proceedings is possible if it is nuisance per se.38 Nuisance per se is that which is nuisance at all times and under any circumstance, regardless of location and surroundings. 39 In this case, the market stall cannot be considered as a nuisance per se because as found out by the Court, the buildings had not been affected by the 1986 fire. This finding was certified to by Supervising Civil Engineer Wilfredo A. Sambrano of the Laguna District Engineer Office. 40 To quote: An inspection has been made on the building (a commercial establishment) cited above and found out the following: 1. It is a two-storey building, sketch of which is attached. 2. It is located within the market site. 3. The building has not been affected by the recent fire. 4. The concrete wall[s] does not even show signs of being exposed to fire.41 Second, the Sangguniang Bayan resolutions are not enough to justify demolition. Unlike its predecessor law,42 the present Local Government Code43 does not expressly provide for the abatement of nuisance.44 And even assuming that the power to abate nuisance is provided for by the present code, the accused public officials were under the facts of this case, still devoid of any power to demolish the store. A closer look at the contested resolutions

71

reveals that Mayor Comendador was only authorized to file an unlawful detainer case in case of resistance to obey the order or to demolish the building using legal means. Clearly, the act of demolition without legal order in this case was not among those provided by the resolutions, as indeed, it is a legally impossible provision. Furthermore, the Municipality of Nagcarlan, Laguna, as represented by the then Mayor Comendador, was placed in estoppel after it granted yearly business permits45 in favor of the Spouses Bombasi. Art. 1431 of the New Civil Code provides that, through estoppel, an admission or representation is rendered conclusive upon the person making it, and cannot be denied or disproved as against the person relying thereon. The representation made by the municipality that the Spouses Bombasi had the right to continuously operate its store binds the municipality. It is utterly unjust for the Municipality to receive the benefits of the store operation and later on claim the illegality of the business. The bad faith of the petitioners completes the elements of the criminal offense of violation of Sec. 3(e) of Republic Act No. 3019. The same bad faith serves as the source of the civil liability of Asilo, Angeles, and Mayor Comendador. It must be noted that when Angeles died on 16 November 1997, a motion to drop him as an accused was filed by his counsel with no objection on the part of the prosecution. The Sandiganbayan acted favorably on the motion and issued an Order dismissing all the cases filed against Angeles. On the other hand, when Mayor Comendador died and an adverse decision was rendered against him which resulted in the filing of a motion for reconsideration by Mayor Comendadors counsel, the prosecution opposed the Motion specifying the ground that the civil liability did not arise from delict, hence, survived the death of the accused. The Sandiganbayan upheld the opposition of the prosecution which disposition was not appealed. We note, first off, that the death of Angeles and of Mayor Comendador during the pendency of the case extinguished their criminal liabilities. We now hold, as did the Sandiganbayan that the civil liability of Mayor Comendador survived his death; and that of Angeles could have likewise survived had it not been for the fact that the resolution of the Sandiganbayan that

his death extinguished the civil liability was not questioned and lapsed into finality. We laid down the following guidelines in People v. Bayotas:46 Death of the accused pending appeal of his conviction extinguishes his criminal liability as well as the civil liability based solely thereon. As opined by Justice Regalado, in this regard, "the death of the accused prior to final judgment terminates his criminal liability and only the civil liability directly arising from and based solely on the offense committed, i.e., civil liability ex delicto in senso strictiore." Corollarily, the claim for civil liability survives notwithstanding the death of (the) accused, if the same may also be predicated on a source of obligation other than delict. Article 1157 of the Civil Code enumerates these other sources of obligation from which the civil liability may arise as a result of the same act or omission: a) Law b) Contracts c) Quasi-contracts d) Acts or omissions punished by law; and e) Quasi-delicts. (Emphasis ours) Where the civil liability survives, as explained [above], an action for recovery therefore may be pursued but only by way of filing a separate civil action47 and subject to Section 1, Rule 111 of the 1985 Rules on Criminal Procedure as amended. This separate civil action may be enforced either against the executor/administrator or the estate of the accused, depending on the source of obligation upon which the same is based as explained above. Finally, the private offended party need not fear a forfeiture of his right to file this separate civil action by prescription, in cases where during the prosecution of the criminal action and prior to its extinction, the private-offended party instituted together therewith the civil action. In such case, the statute of limitations on the civil liability is deemed interrupted during the pendency of the criminal case, conformably with provisions of Article 1155 of the New Civil Code, which should thereby avoid any apprehension on a possible privation of right by prescription.

72

Upon death of the accused pending appeal of his conviction, the criminal action is extinguished inasmuch as there is no longer a defendant to stand as the accused; the civil action instituted therein for recovery of civil liability ex delicto is ipso facto extinguished, grounded as it is on the criminal.48 The New Civil Code provisions under the Chapter, Human Relations, were cited by the prosecution to substantiate its argument that the civil action based therein is an independent one, thus, will stand despite the death of the accused during the pendency of the case. On the other hand, the defense invoked Section 4 of Presidential Decree No. 1606, as amended by Republic Act No. 8249, in support of its argument that the civil action was dependent upon the criminal action, thus, was extinguished upon the death of the accused. The law provides that: Any provision of law or the Rules of Court to the contrary notwithstanding, the criminal action and the corresponding civil action for the recovery of civil liability arising from the offense charged shall at all times be simultaneously instituted with, and jointly determined in the same proceeding by, the Sandiganbayan, the filing of the criminal action being deemed to necessarily carry with it the filing of the civil action, and no right to reserve the filing of such action shall be recognized. (Emphasis ours) We agree with the prosecution. Death of Mayor Comendador during the pendency of the case could have extinguished the civil liability if the same arose directly from the crime committed. However, in this case, the civil liability is based on another source of obligation, the law on human relations.49 The pertinent articles follow: Art. 31 of the Civil Code states: When the civil action is based on an obligation not arising from the act or omission complained of as a felony, such civil action may proceed independently of the criminal proceedings and regardless of the result of the latter. And, Art. 32(6) states: Any public officer or employee, or any private individual, who directly or indirectly obstructs, defeats, violates or in any manner impedes or impairs any of the following rights and liberties of another person shall be liable to the latter for damages:

(6) The right against deprivation of property without due process of law; xxxx In any of the cases referred to in this article, whether or not the defendant's act or omission constitutes a criminal offense, the aggrieved party has a right to commence an entirely separate and distinct civil action for damages, and for other relief. Such civil action shall proceed independently of any criminal prosecution (if the latter be instituted), and may be proved by a preponderance of evidence. As held in Aberca v. Ver: It is obvious that the purpose of the above codal provision [Art. 32 of the New Civil Code] is to provide a sanction to the deeply cherished rights and freedoms enshrined in the Constitution. Its message is clear; no man may seek to violate those sacred rights with impunity. x x x.50 Indeed, the basic facts of this case point squarely to the applicability of the law on human relations. First, the complaint for civil liability was filed way AHEAD of the information on the Anti-Graft Law. And, the complaint for damages specifically invoked defendant Mayor Comendadors violation of plaintiffs right to due process. Thus: xxxx In causing or doing the forcible demolition of the store in question, the individual natural defendants did not only act with grave abuse of authority but usurped a power which belongs to our courts of justice; such actuations were done with malice or in bad faith and constitute an invasion of the property rights of plaintiff(s) without due process of law. xxxx The Court is in one with the prosecution that there was a violation of the right to private property of the Spouses Bombasi. The accused public officials should have accorded the spouses the due process of law guaranteed by the Constitution and New Civil Code. The Sangguniang Bayan Resolutions as asserted by the defense will not, as already shown, justify demolition of the store without court order. This Court in a number of decisions 51 held that even if there is already a writ of execution, there must still be a need for a special order for the purpose of demolition issued by the court before the officer in charge can destroy,

73

demolish or remove improvements over the contested property.52 The pertinent provisions are the following: Before the removal of an improvement must take place, there must be a special order, hearing and reasonable notice to remove. Section 10(d), Rule 39 of the Rules of Court provides: (d) Removal of improvements on property subject of execution. When the property subject of execution contains improvements constructed or planted by the judgment obligor or his agent, the officer shall not destroy, demolish or remove said improvements except upon special order of the court, issued upon motion of the judgment obligee after due hearing and after the former has failed to remove the same within a reasonable time fixed by the court. The above-stated rule is clear and needs no interpretation. If demolition is necessary, there must be a hearing on the motion filed and with due notices to the parties for the issuance of a special order of demolition.53 This special need for a court order even if an ejectment case has successfully been litigated, underscores the independent basis for civil liability, in this case, where no case was even filed by the municipality. The requirement of a special order of demolition is based on the rudiments of justice and fair play. It frowns upon arbitrariness and oppressive conduct in the execution of an otherwise legitimate act. It is an amplification of the provision of the Civil Code that every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith.54 Notably, the fact that a separate civil action precisely based on due process violations was filed even ahead of the criminal case, is complemented by the fact that the deceased plaintiff Comendador was substituted by his widow, herein petitioner Victoria who specified in her petition that she has "substituted him as petitioner in the above captioned case." Section 1, Rule III of the 1985 Rules in Criminal Procedure mentioned in Bayotas is, therefore, not applicable. Truly, the Sandiganbayan was correct when it maintained the separate docketing of the civil and criminal cases before it although their consolidation was erroneously based on Section 4 of Presidential Decree No.

1606 which deals with civil liability "arising from the offense charged." We must, however, correct the amount of damages awarded to the Spouses Bombasi. To seek recovery of actual damages, it is necessary to prove the actual amount of loss with a reasonable degree of certainty, premised upon competent proof and on the best evidence obtainable.55 In this case, the Court finds that the only evidence presented to prove the actual damages incurred was the itemized list of damaged and lost items56 prepared by Engineer Cabrega, an engineer commissioned by the Spouses Bombasi to estimate the costs. As held by this Court in Marikina Auto Line Transport Corporation v. People of the Philippines,57 x x x [W]e agree with the contention of petitioners that respondents failed to prove that the damages to the terrace caused by the incident amounted to P100,000.00. The only evidence adduced by respondents to prove actual damages claimed by private respondent were the summary computation of damage made by Engr. Jesus R. Regal, Jr. amounting to P171,088.46 and the receipt issued by the BB Construction and Steel Fabricator to private respondent for P35,000.00 representing cost for carpentry works, masonry, welding, and electrical works. Respondents failed to present Regal to testify on his estimation. In its fivepage decision, the trial court awardedP150,000.00 as actual damages to private respondent but failed to state the factual basis for such award. Indeed, the trial court merely declared in the decretal portion of its decision that the "sum of P150,000.00 as reasonable compensation sustained by plaintiff for her damaged apartment." The appellate court, for its part, failed to explain how it arrived at the amount of P100,000.00 in its three-page decision. Thus, the appellate court merely declared: With respect to the civil liability of the appellants, they contend that there was no urgent necessity to completely demolish the apartment in question considering the nature of the damages sustained as a result of the accident. Consequently, appellants continue, the award of P150,000.00 as compensation sustained by the plaintiff-appellee for her damaged apartment is an unconscionable amount. Further, in one case,58 this Court held that the amount claimed by the respondent-claimants

74

witness as to the actual amount of damages "should be admitted with extreme caution considering that, because it was a bare assertion, it should be supported by independent evidence." The Court further said that whatever claim the respondent witness would allege must be appreciated in consideration of his particular selfinterest.59 There must still be a need for the examination of the documentary evidence presented by the claimants to support its claim with regard to the actual amount of damages. The price quotation made by Engineer Cabrega presented as an exhibit60 partakes of the nature of hearsay evidence considering that the person who issued them was not presented as a witness.61 Any evidence, whether oral or documentary, is hearsay if its probative value is not based on the personal knowledge of the witness but on the knowledge of another person who is not on the witness stand. Hearsay evidence, whether objected to or not, has no probative value unless the proponent can show that the evidence falls within the exceptions to the hearsay evidence rule.62 Further, exhibits do not fall under any of the exceptions provided under Sections 37 to 47 of Rule 130 of the Rules of Court. Though there is no sufficient evidence to award the actual damages claimed, this Court grants temperate damages for P200,000.00 in view of the loss suffered by the Spouses Bombasi. Temperate damages are awarded in accordance with Art. 2224 of the New Civil Code when the court finds that some pecuniary loss has been suffered but its amount cannot, from the nature of the case, be proven with certainty. The amount of temperate or moderated damages is usually left to the discretion of the courts but the same should be reasonable, bearing in mind that the temperate damages should be more than nominal but less than compensatory.63 Without a doubt, the Spouses Bombasi suffered some form of pecuniary loss in the impairment of their store. Based on the record of the case,64 the demolished store was housed on a two-story building located at the markets commercial area and its concrete walls remained strong and not affected by the fire. However, due to the failure of the Spouses Bombasi to prove the exact amount of damage in accordance with the Rules of Evidence,65 this court finds thatP200,000.00 is the amount just and reasonable under the circumstances. WHEREFORE, the instant appeal is DENIED. Accordingly, the Decision of the Sandiganbayan dated 28 April 2003 is hereby AFFIRMED WITH MODIFICATION. The Court affirms the decision finding the accused Paulino S. Asilo, Jr. and

Demetrio T. Comendador guilty of violating Section 3(e) of Republic Act No. 3019. We declare the finality of the dismissal of both the criminal and civil cases against Alberto S. Angeles as the same was not appealed. In view of the death of Demetrio T. Comendador pending trial, his criminal liability is extinguished; but his civil liability survives. The Municipality of Nagcarlan, Paulino Asilo and Demetrio T. Comendador, as substituted by Victoria Bueta Vda. De Comendador, are hereby declared solidarily liable to the Spouses Bombasi for temperate damages in the amount of P200,000.00 and moral damages in the amount of P100,000.00. Costs against the petitioners-appellants. SO ORDERED. G.R. No.148004 January 22, 2007

VINCENT E. OMICTIN, Petitioner, vs. HON. COURT OF APPEALS (Special Twelfth Division) and GEORGE I. LAGOS, Respondents. DECISION AZCUNA, J.: This is a petition for certiorari1 with prayer for a writ of preliminary injunction seeking the nullification of the decision rendered by the Court of Appeals (CA) on June 30, 2000, and its resolution, dated March 5, 2001 in CA-G.R. SP No. 55834 entitled "George I. Lagos v. Hon. Reinato G. Quilala, Presiding Judge of RTC, Br. 57, Makati, Hon. Elizabeth Tayo Chua, Asst. City Prosecutor, Makati City, and Vincent E. Omictin." In its assailed decision, the CA declared the existence of a prejudicial question and ordered the suspension of the criminal proceedings initiated by petitioner Vincent E. Omictin on behalf of Saag Phils., Inc. against private respondent George I. Lagos, in view of a pending case before the Securities and Exchange Commission (SEC) filed by the latter against the former, Saag Pte. (S) Ltd., Nicholas Ng, Janifer Yeo and Alex Y. Tan. The facts are as follows: Petitioner Vincent E. Omictin, Operations Manager Ad Interim of Saag Phils., Inc., filed a complaint for two counts of estafa with the Office of the City Prosecutor of Makati against

75

private respondent George I. Lagos. He alleged that private respondent, despite repeated demands, refused to return the two company vehicles entrusted to him when he was still the president of Saag Phils., Inc.. On February 26, 1999, public prosecutor Alex G. Bagaoisan recommended the indictment of private respondent, and on the same day, respondent was charged with the crime of estafa under Article 315, par. 1(b) of the Revised Penal Code before the Regional Trial Court (RTC), Branch 57 of Makati City. The case was docketed as Criminal Case No. 99-633, entitled "People of the Philippines v. George I. Lagos." On June 4, 1999, private respondent filed a motion to recuse praying that Presiding Judge Reinato G. Quilala inhibit himself from hearing the case based on the following grounds: a) In an order, dated May 28, 1999, the presiding judge summarily denied respondents motion: 1) to defer issuance of the warrant of arrest; and 2) to order reinvestigation. b) Immediately before the issuance of the above-mentioned order, the presiding judge and Atty. Alex Y. Tan, SAAG Philippines, Inc.s Ad Interim President, were seen together.2 On June 24, 1999, private respondent filed a motion to suspend proceedings on the basis of a prejudicial question because of a pending petition with the Securities and Exchange Commission (SEC) involving the same parties. It appears that on January 7, 1999, private respondent filed SEC Case No. 01-99-6185 for the declaration of nullity of the respective appointments of Alex Y. Tan and petitioner as President Ad Interim and Operations Manager Ad Interim of Saag Phils., Inc., declaration of dividends, recovery of share in the profits, involuntary dissolution and the appointment of a receiver, recovery of damages and an application for a temporary restraining order (TRO) and injunction against Saag (S) Pte. Ltd., Nicholas Ng, Janifer Yeo, Tan and petitioner. 3 In the action before the SEC, private respondent averred that Saag (S) Pte. Ltd. is a foreign corporation organized and existing under the laws of Singapore, and is fully owned by Saag Corporation (Bhd). On July 1, 1994, he was appointed as Area Sales Manager in the Philippines by Thiang Shiang Hiang, Manager of Saag (S) Pte. Ltd. Pursuant to his appointment,

respondent was authorized to organize a local joint venture corporation to be known as Saag Philippines, Inc. for the wholesale trade and service of industrial products for oil, gas and power industries in the Philippines. On September 9, 1994, Saag Philippines, Inc. was incorporated with Saag (S) Pte. Ltd. as the majority stockholder. Private respondent was appointed to the board of directors, along with Rommel I. Lagos, Jose E. Geronimo, Gan Ching Lai and Thiang Shiang Hiang, and was elected president of the domestic corporation. Later, due to intra-corporate disputes, Gan and Thiang resigned and divested their shares in Saag Corporation (Bhd), thereby resulting in a change in the controlling interest in Saag (S) Pte. Ltd. Barely three months after, or on June 23, 1998, private respondent resigned his post as president of Saag Phils., Inc. while still retaining his position as a director of the company.4 According to private respondent, the joint venture agreement (JVA) between him or Saag Phils., Inc. and Saag (S) Pte. Ltd. provided that should the controlling interest in the latter company, or its parent company Saag Corp. (Bhd), be acquired by any other person or entity without his prior consent, he has the option either to require the other stockholders to purchase his shares or to terminate the JVA and dissolve Saag Phils., Inc. altogether. Thus, pursuant to this provision, since private respondent did not give his consent as regards the transfer of shares made by Gan and Thiang, he made several requests to Nicholas Ng, who replaced Gan as director, and Janifer Yeo, Executive Director of Saag (S) Pte. Ltd., to call for a board meeting in order to discuss the following: a) implementation of the board resolution declaring dividends; b) acquisition of private respondents shares by Saag (S) Pte. Ltd.; c) dissolution of Saag Phils., Inc.; and d) the termination of the JVA. Ng and Yeo failed to appear, however, in the scheduled board meetings. Instead, on September 30, 1998 they issued a letter appointing Alex Y. Tan as President Ad Interim of Saag Phils., Inc. Tan, in turn, appointed petitioner Omictin as the companys Operations Manager Ad Interim. Citing as a reason the absence of a board resolution authorizing the continued operations of Saag Phils., Inc., private respondent retained his possession of the office equipment of the company in a fiduciary capacity as director of the corporation pending its dissolution and/or

76

the resolution of the intra-corporate dispute. He likewise changed the locks of the offices of the company allegedly to prevent Tan and petitioner from seizing company property. Private respondent stressed that Tans appointment was invalid because it was in derogation of the company by-laws requiring that the president must be chosen from among the directors, and elected by the affirmative vote of a majority of all the members of the board of directors.5 As Tans appointment did not have the acquiescence of the board of directors, petitioners appointment by the former is likewise allegedly invalid. Thus, neither has the power or the authority to represent or act for Saag Phils., Inc. in any transaction or action before the SEC or any court of justice. The trial court, in an order dated September 8, 1999, denied respondents motion to suspend proceedings and motion to recuse. His motion for reconsideration having been denied by the trial court in its order issued on October 29, 1999, respondent filed with the CA the petition for certiorari[6] assailing the aforesaid orders. On June 30, 2000, the challenged decision. The reads: CA rendered its pertinent portion

motion to suspend proceedings is hereby GRANTED and respondent court is hereby enjoined from hearing Criminal Case No. 99633, entitled "People of the Philippines v. George I. Lagos," until the termination of the case with the Securities and Exchange Commission. The denial of the motion to recuse is hereby AFFIRMED. SO ORDERED.7 Incidentally, on January 18, 2001, the SEC case8 was transferred to the Regional Trial Court (RTC) of Mandaluyong City, Branch 214, pursuant to A.M. No. 00-11-03SC9 implementing the Securities and Regulation Code (Republic Act No. 8799)10 enacted on July 19, 2000, vesting in the RTCs jurisdiction over intra-corporate disputes.11 Meanwhile, on March 5, 2001, the CA, addressing petitioners motion for reconsideration of the aforementioned decision, issued its assailed resolution: Considering that the petition for review on certiorari of the 30 June 2000 decision of this Court, filed by the Office of the Solicitor General before the Supreme Court has already TERMINATED on November 20, 2000 and a corresponding entry of judgment has already been issued by the High Court, that the same is final and executory, the private respondents motion for reconsideration of the decision 30 June 2000 before this Court is NOTED for being moot and academic. SO ORDERED.12 Hence, this petition raises the following issues: I RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION A) WHEN IT DECREED THAT A PREJUDICIAL QUESTION EXISTS IN THE SEC CASE FILED BY PRIVATE RESPONDENT AGAINST SAAG (S) PTE. LTD., A FOREIGN CORPORATION, ALTHOUGH THE PRIVATE COMPLAINANT IN THE CRIMINAL CASE FOR ESTAFA (WHERE PRIVATE RESPONDENT IS THE ACCUSED THEREIN) IS ACTUALLY SAAG PHILIPPINES, INC. A DOMESTIC CORPORATION WITH A SEPARATE JURIDICAL PERSONALITY OF ITS OWN AND WHICH IS NOT EVEN A PARTY IN THE SEC CASE; AND,

In a case for estafa, a valid demand made by an offended party is one of the essential elements. It appears from the records that the delay of delivery of the motor vehicles by petitioner to Saag Corporation is by reason of petitioners contention that the demand made by Omictin and Atty. Tan to him to return the subject vehicles is not a valid demand. As earlier mentioned, petitioner filed a case with the SEC questioning therein private respondents appointment. If the SEC should rule that the dissolution of Saag Phils. is proper, or that the appointments of private respondents are invalid, the criminal case will eventually be dismissed due to the absence of one of the essential elements of the crime of estafa. Based on the foregoing, it is clear that a prejudicial question exists which calls for the suspension of the criminal proceedings before the lower court. WHEREFORE, in view of the foregoing, the assailed Order of September 8, 1999 and October 29, 1999, are hereby MODIFIED. The

77

B) WHEN IT ORDERED THE SUSPENSION OF THE PROCEEDINGS IN CRIMINAL CASE NO. 99-633 AGAINST PRIVATE RESPONDENT. II THIS PETITION FOR CERTIORARI IS THE ONLY PLAIN, SPEEDY AND ADEQUATE REMEDY IN THE PREMISES. In support of the above, petitioner argues, as follows: 1. The action before the SEC and the criminal case before the trial court do not involve any prejudicial question.13 SEC Case No. 01-99-6185 mainly involves the dissolution of Saag (S) Pte. Ltd., the appointment of a receiver, the distribution of profits, and the authority of petitioner and Tan to represent Saag Phils., Inc. The entity which is being sued is Saag (S) Pte. Ltd., a foreign corporation over which the SEC has yet to acquire jurisdiction. Hence, any decision that may be rendered in the SEC case will neither be determinative of the innocence or guilt of the accused nor bind Saag Phils., Inc. because the same was not made a party to the action even if the former is its holding corporation; 2. Saag Phils., Inc. has a separate corporate existence and is to be treated as a separate entity from its holding or parent company, Saag (S) Pte. Ltd. The mere fact that one or more corporations are owned or controlled by the same or single stockholder is not a sufficient ground for disregarding separate corporate personalities; 3. Private respondents petition with the SEC seeks affirmative relief against Saag (S) Pte. Ltd. for the enforcement or application of the alleged terms of the joint venture agreement (JVA) that he purportedly entered into with the foreign corporation while he was still its Area Sales Manager in the Philippines. The foreign corporation is not licensed to do business in the Philippines, thus, a party to a contract with a foreign corporation doing business in the Philippines without a license is not entitled to relief from the latter; and 4. There is no pending civil or administrative case in SEC against Saag Phils., Inc. that warrants the application

of a prejudicial question and the consequent suspension of the criminal action it has instituted against private respondent. If any, the action before the SEC was merely a ploy to delay the resolution of the criminal case and eventually frustrate the outcome of the estafa case. In sum, the main issue is whether or not a prejudicial question exists to warrant the suspension of the criminal proceedings pending the resolution of the intra-corporate controversy that was originally filed with the SEC. A prejudicial question is defined as that which arises in a case, the resolution of which is a logical antecedent of the issue involved therein and the cognizance of which pertains to another tribunal.14 Here, the case which was lodged originally before the SEC and which is now pending before the RTC of Mandaluyong City by virtue of Republic Act No. 8799 involves facts that are intimately related to those upon which the criminal prosecution is based. Ultimately, the resolution of the issues raised in the intra-corporate dispute will determine the guilt or innocence of private respondent in the crime of estafa filed against him by petitioner before the RTC of Makati. As correctly stated by the CA, one of the elements of the crime of estafa with abuse of confidence under Article 315, par. 1(b) of the Revised Penal Code is a demand made by the offended party to the offender: The elements of estafa with abuse of confidence under subdivision No. 1, par. (b) of Art. 315 are as follows: 1. That money, goods, or other personal property be received by the offender in trust, or on commission, or for administration, or under any other obligation involving the duty to make delivery of, or to return the same; 2. That there be misrepresentation or conversion of such money or property by the offender, or denial on his part of such receipt; 3. That such misappropriation or conversion or denial is to the prejudice of another; and 4. That there is a demand made by the offended party to the offender.15

78

Logically, under the circumstances, since the alleged offended party is Saag Phils., Inc., the validity of the demand for the delivery of the subject vehicles rests upon the authority of the person making such a demand on the companys behalf. Private respondent is challenging petitioners authority to act for Saag Phils., Inc. in the corporate case pending before the RTC of Mandaluyong, Branch 214. Taken in this light, if the supposed authority of petitioner is found to be defective, it is as if no demand was ever made, hence, the prosecution for estafa cannot prosper. Moreover, the mere failure to return the thing received for safekeeping or on commission, or for administration, or under any other obligation involving the duty to deliver or to return the same or deliver the value thereof to the owner could only give rise to a civil action and does not constitute the crime of estafa. This is because the crime is committed by misappropriating or converting money or goods received by the offender under a lawful transaction. As stated in the case of United States v. Bleibel:16 The crime of estafa is not committed by the failure to return the things received for sale on commission, or to deliver their value, but, as this class of crime is defined by law, by misappropriating or converting the money or goods received on commission. Delay in the fulfillment of a commission or in the delivery of the sum on such account received only involves civil liability. So long as the money that a person is under obligation to deliver is not demanded of him, and he fails to deliver it for having wrongfully disposed of it, there is no estafa, whatever be the cause of the debt. Likewise, by analogy, the doctrine of primary jurisdiction may be applied in this case. The issues raised by petitioner particularly the status of Saag Phils., Inc. vis--vis Saag (S) Pte. Ltd., as well as the question regarding the supposed authority of the latter to make a demand on behalf of the company, are proper subjects for the determination of the tribunal hearing the intra-corporate case which in this case is the RTC of Mandaluyong, Branch 214. These issues would have been referred to the expertise of the SEC in accordance with the doctrine of primary jurisdiction had the case not been transferred to the RTC of Mandaluyong. Strictly speaking, the objective of the doctrine of primary jurisdiction is to guide a court in determining whether it should refrain from exercising its jurisdiction until after an administrative agency has determined some question or some aspect of some question arising in the proceeding before the court. 17 The

court cannot or will not determine a controversy involving a question which is within the jurisdiction of the administrative tribunal prior to resolving the same, where the question demands the exercise of sound administrative discretion requiring special knowledge, experience and services in determining technical and intricate matters of fact.18 While the above doctrine refers specifically to an administrative tribunal, the Court believes that the circumstances in the instant case do not proscribe the application of the doctrine, as the role of an administrative tribunal such as the SEC in determining technical and intricate matters of special competence has been taken on by specially designated RTCs by virtue of Republic Act No. 8799.19 Hence, the RTC of Mandaluyong where the intra-corporate case is pending has the primary jurisdiction to determine the issues under contention relating to the status of the domestic corporation, Saag Phils., Inc., vis--vis Saag Pte. Ltd.; and the authority of petitioner to act on behalf of the domestic corporation, the determination of which will have a direct bearing on the criminal case. The law recognizes that, in place of the SEC, the regular courts now have the legal competence to decide intra-corporate disputes.20 In view of the foregoing, the Court finds no substantial basis in petitioners contention that the CA committed grave abuse of discretion amounting to lack or excess of jurisdiction. Absent a showing of a despotic, whimsical and arbitrary exercise of power by the CA, the petition must fail. WHEREFORE, the petition is DISMISSED. The decision and resolution of the Court of Appeals in CA-G.R. SP No. 55834, dated June 30, 2000 and March 5, 2001, respectively, are AFFIRMED. No costs. SO ORDERED.

79

G.R. No. 148072

July 10, 2007

FRANCISCO MAGESTRADO, Petitioner, vs. PEOPLE OF THE PHILIPPINES and ELENA M. LIBROJO Respondents. DECISION CHICO-NAZARIO, J.: This Petition for Review on Certiorari seeks to reverse the (1) Resolution1 dated 5 March 2001 of the Court of Appeals in CA-G.R. SP No. 63293 entitled, "Francisco Magestrado v. Hon. Estrella T. Estrada, in her capacity as the Presiding Judge of Regional Trial Court, Branch 83 of Quezon City, People of the Philippines and Elena M. Librojo," which dismissed petitioner Francisco Magestrados Petition for Certiorari for being the wrong remedy; and (2) Resolution2 dated 3 May 2001 of the same Court denying petitioners motion for reconsideration. Private respondent Elena M. Librojo filed a criminal complaint3 for perjury against petitioner with the Office of the City Prosecutor of Quezon City, which was docketed as I.S. No. 98-3900. After the filing of petitioners counter-affidavit and the appended pleadings, the Office of the City Prosecutor recommended the filing of an information for perjury against petitioner. Thus, Assistant City Prosecutor Josephine Z. Fernandez filed an information for perjury against petitioner with the Metropolitan Trial Court (MeTC) of Quezon City. Pertinent portions of the information are hereby quoted as follows: That on or about the 27th day of December, 1997, in Quezon City, Philippines, the said accused, did then and there willfully, unlawfully and feloniously and knowingly make an untruthful statement under oath upon a material matter before a competent officer authorized to receive and administer oath and which the law so require, to wit: the said accused subscribe and swore to an Affidavit of Loss before Notary Public Erlinda B. Espejo of Quezon City, per Doc. No. 168, Page No. 35, Book No. CLXXIV of her notarial registry, falsely alleging that he lost Owners Duplicate Certificate of TCT No. N-173163, which document was used in support of a Petition For Issuance of New Owners Duplicate Copy of Certificate of Title and filed with the Regional Trial Court of Quezon City, docketed as LRC# Q10052 (98) on January 28, 1998 and assigned to

Branch 99 of the said court, to which said Francisco M. Mag[e]strado signed and swore on its verification, per Doc. 413 Page 84 Book No. CLXXV Series of 1998 of Notary Public Erlinda B. Espejo of Quezon City; the said accused knowing fully well that the allegations in the said affidavit and petition are false, the truth of the matter being that the property subject of Transfer Certificate of Title No. N-173163 was mortgaged to complainant Elena M. Librojo as collateral for a loan in the amount of P 758,134.42 and as a consequence of which said title to the property was surrendered by him to the said complainant by virtue of said loan, thus, making untruthful and deliberate assertions of falsehoods, to the damage and prejudice of the said Elena M. Librojo.4 The case was raffled to the MeTC of Quezon City, Branch 43, where it was docketed as Criminal Case No. 90721 entitled, "People of the Philippines v. Francisco Magestrado." On 30 June 1999, petitioner filed a motion 5 for suspension of proceedings based on a prejudicial question. Petitioner alleged that Civil Case No. Q-98-34349, a case for recovery of a sum of money pending before the Regional Trial Court (RTC) of Quezon City, Branch 84, and Civil Case No. Q-98- 34308, a case for Cancellation of Mortgage, Delivery of Title and Damages, pending before the RTC of Quezon City, Branch 77, must be resolved first before Criminal Case No. 90721 may proceed since the issues in the said civil cases are similar or intimately related to the issues raised in the criminal action. On 14 July 1999, MeTC-Branch 43 issued an Order6 denying petitioners motion for suspension of proceedings, thus: Acting on the "Motion for Suspension of Proceedings" filed by the [herein petitioner Magestrado], thru counsel, and the "Comment and Opposition thereto, the Court after an evaluation of the same, finds the aforesaid motion without merit, hence, is hereby DENIED, it appearing that the resolution of the issues raised in the civil actions is not determinative of the guilt or innocence of the accused. Hence, the trial of this case shall proceed as previously scheduled on July 19 and August 2, 1993 at 8:30 in the morning. On 17 August 1999, a motion7 for reconsideration was filed by petitioner but was denied by the MeTC in an Order 8 dated 19 October 1999.

80

Aggrieved, petitioner filed a Petition for Certiorari9 under Rule 65 of the Revised Rules of Court, with a prayer for Issuance of a Writ of Preliminary Injunction before the RTC of Quezon City, Branch 83, docketed as Civil Case No. Q99-39358, on the ground that MeTC Judge Billy J. Apalit committed grave abuse of discretion amounting to lack or excess of jurisdiction in denying his motion to suspend the proceedings in Criminal Case No. 90721. On 14 March 2000, RTC-Branch 83 dismissed the petition and denied the prayer for the issuance of a writ of preliminary injunction, reasoning thus: Scrutinizing the complaints and answers in the civil cases abovementioned, in relation to the criminal action for PERJURY, this Court opines and so holds that there is no prejudicial question involved as to warrant the suspension of the criminal action to await the outcome of the civil cases. The civil cases are principally for determination whether or not a loan was obtained by petitioner and whether or not he executed the deed of real estate mortgage involving the property covered by TCT No. N173163, whereas the criminal case is for perjury which imputes upon petitioner the wrongful execution of an affidavit of loss to support his petition for issuance of a new owners duplicate copy of TCT No. 173163. Whether or not he committed perjury is the issue in the criminal case which may be resolved independently of the civil cases. Note that the affidavit of loss was executed in support of the petition for issuance of a new owners duplicate copy of TCT No. N-173163 which petition was raffled to Branch 99 of the RTC. x x x.10 Again, petitioner filed a motion for reconsideration11 but this was denied by RTCBranch 83 in an Order12 dated 21 December 2000. Dissatisfied, petitioner filed with the Court of Appeals a Petition for Certiorari13 under Rule 65 of the Revised Rules of Court, which was docketed as CA-G.R. SP No. 63293. Petitioner alleged that RTC Judge Estrella T. Estrada committed grave abuse of discretion amounting to lack or excess of jurisdiction in denying the Petition for Certiorari in Civil Case No. Q-9939358, and in effect sustaining the denial by MeTC-Branch 43 of petitioners motion to suspend the proceedings in Criminal Case No. 90721, as well as his subsequent motion for reconsideration thereof. On 5 March 2001, the Court of Appeals dismissed14 the Petition in CA-G.R. SP No. 63293

on the ground that petitioners remedy should have been an appeal from the dismissal by RTCBranch 83 of his Petition for Certiorari in Q-9939358. The Court of Appeals ruled that: Is this instant Petition for Certiorari under Rule 65 the correct and appropriate remedy? We rule negatively. The resolution or dismissal in special civil actions, as in the instant petition, may be appealed x x x under Section 10, Rule 44 of the 1997 Rules of Civil Procedure and not by petition for certiorari under Rule 65 of the same rules. Thus, the said rule provides: Section 10. Time for filing memoranda on special cases. In certiorari, prohibition, mandamus, quo warranto and habeas corpus cases, the parties shall file in lieu of briefs, their respective memoranda within a non-extendible period of thirty (30) days from receipt of the notice issued by the clerk that all the evidence, oral and documentary, is already attached to the record x x x. WHEREFORE, in consideration of the foregoing premises, the instant Petition for Certiorari under Rule 65 of the 1997 Rules of Civil Procedure is hereby DISMISSED.15 The Court of Appeals denied petitioners Motion for Reconsideration16 in a Resolution17 dated 3 May 2001. Hence, petitioner comes before us via a Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court raising the following issues: 1. Whether or not the Orders of Judge Estrella T. Estrada dated March 14, 2000 denying petitioners Petition for Certiorari under Rule 65 of the Rules of Court, and her subsequent Order dated December 21, 2000, denying the Motion for Reconsideration thereafter filed can only be reviewed by the Court of Appeals thru appeal under Section 10, Rule 44 of the 1997 Rules of Civil Procedure. 2. Whether or not Judge Estrella T. Estrada of the Regional Trial Court, Branch 83, Quezon City, had committed grave abuse of discretion amounting to lack or in excess of her jurisdiction in denying the Petition for Certiorari and petitioners subsequent motion for reconsideration on the ground of a prejudicial question pursuant to the

81

Rules on Criminal Procedure and the prevailing jurisprudence. After consideration of the procedural and substantive issues raised by petitioner, we find the instant petition to be without merit. The procedural issue herein basically hinges on the proper remedy which petitioner should have availed himself of before the Court of Appeals: an ordinary appeal or a petition for certiorari. Petitioner claims that he correctly questioned RTC-Branch 83s Order of dismissal of his Petition for Certiorari in Civil Case No. Q-9939358 through a Petition for Certiorari before the Court of Appeals. Private respondent and public respondent People of the Philippines insist that an ordinary appeal was the proper remedy. We agree with respondents. We hold that the appellate court did not err in dismissing petitioners Petition for Certiorari, pursuant to Rule 41, Section 2 of the Revised Rules of Court (and not under Rule 44, Section 10, invoked by the Court of Appeals in its Resolution dated 5 March 2001). The correct procedural recourse for petitioner was appeal, not only because RTC-Branch 83 did not commit any grave abuse of discretion in dismissing petitioners Petition for Certiorari in Civil Case No. Q-99-39358 but also because RTC-Branch 83s Order of dismissal was a final order from which petitioners should have appealed in accordance with Section 2, Rule 41 of the Revised Rules of Court. An order or a judgment is deemed final when it finally disposes of a pending action, so that nothing more can be done with it in the trial court. In other words, the order or judgment ends the litigation in the lower court. Au contraire, an interlocutory order does not dispose of the case completely, but leaves something to be done as regards the merits of the latter.18 RTC-Branch 83s Order dated 14 March 2001 dismissing petitioners Petition for Certiorari in Civil Case No. Q-99-39358 finally disposes of the said case and RTC-Branch 83 can do nothing more with the case. Under Rule 41 of the Rules of Court, an appeal may be taken from a judgment or final order that completely disposes of the case, or of a particular matter therein when declared by the Revised Rules of Court to be appealable. The manner of appealing an RTC judgment or final order is also provided in Rule 41 as follows: Section 2. Modes of appeal.

(a) Ordinary appeal. The appeal to the Court of Appeals in cases decided by the Regional Trial Court in the exercise of its original jurisdiction shall be taken by filing a notice of appeal with the court which rendered the judgment or final order appealed from and serving a copy thereof upon the adverse party. No record on appeal shall be required except in special proceedings and other cases of multiple or separate appeals where the law or these Rules so require. In such cases, the record on appeal shall be filed and served in like manner. Certiorari generally lies only when there is no appeal nor any other plain, speedy or adequate remedy available to petitioners. Here, appeal was available. It was adequate to deal with any question whether of fact or of law, whether of error of jurisdiction or grave abuse of discretion or error of judgment which the trial court might have committed. But petitioners instead filed a special civil action for certiorari. We have time and again reminded members of the bench and bar that a special civil action for certiorari under Rule 65 of the Revised Rules of Court lies only when "there is no appeal nor plain, speedy and adequate remedy in the ordinary course of law."19 Certiorari cannot be allowed when a party to a case fails to appeal a judgment despite the availability of that remedy,20 certiorari not being a substitute for lost appeal.21 As certiorari is not a substitute for lost appeal, we have repeatedly emphasized that the perfection of appeals in the manner and within the period permitted by law is not only mandatory but jurisdictional, and that the failure to perfect an appeal renders the decision of the trial court final and executory. This rule is founded upon the principle that the right to appeal is not part of due process of law but is a mere statutory privilege to be exercised only in the manner and in accordance with the provisions of the law. Neither can petitioner invoke the doctrine that rules of technicality must yield to the broader interest of substantial justice. While every litigant must be given the amplest opportunity for the proper and just determination of his cause, free from constraints of technicalities, the failure to perfect an appeal within the reglementary period is not a mere technicality. It raises a jurisdictional problem as it deprives the appellate court of jurisdiction over the appeal.22 The remedies of appeal and certiorari are mutually exclusive and not alternative or successive.23 A party cannot substitute the special civil action of certiorari under Rule 65 of the Rules of Court for the remedy of appeal. The

82

existence and availability of the right of appeal are antithetical to the availability of the special civil action for certiorari.24 As this Court held in Fajardo v. Bautista25 : Generally, an order of dismissal, whether right or wrong, is a final order, and hence a proper subject of appeal, not certiorari. The remedies of appeal and certiorari are mutually exclusive and not alternative or successive. Accordingly, although the special civil action of certiorari is not proper when an ordinary appeal is available, it may be granted where it is shown that the appeal would be inadequate, slow, insufficient, and will not promptly relieve a party from the injurious effects of the order complained of, or where appeal is inadequate and ineffectual. Nevertheless, certiorari cannot be a substitute for the lost or lapsed remedy of appeal, where such loss is occasioned by the petitioners own neglect or error in the choice of remedies. On 21 December 2000, petitioner received a copy of the Order of the RTC-Branch 83 denying his motion for reconsideration of the dismissal of his Petition for Certiorari in Civil Case No. Q99-39358; hence, he had until 18 January 2001 within which to file an appeal with the Court of Appeals. The Petition for Certiorari filed by petitioner on 19 February 2001 with the Court of Appeals cannot be a substitute for the lost remedy of appeal. As petitioner failed to file a timely appeal, RTC-Branch 83s dismissal of his Petition for Certiorari had long become final and executory. For this procedural lapse, the Court of Appeals correctly denied outright the Petition for Certiorari filed by petitioner before it. Moreover, there are even more cogent reasons for denying the instant Petition on the merits. In the Petition at bar, petitioner raises several substantive issues. Petitioner harps on the need for the suspension of the proceedings in Criminal Case No. 90721 for perjury pending before MeTC-Branch 43 based on a prejudicial question still to be resolved in Civil Case No. Q98-34308 (for cancellation of mortgage) and Civil Case No. Q-98-34349 (for collection of a sum of money) which are pending before other trial courts.1avvphi1 For clarity, we shall first discuss the allegations of petitioner in his complaint in Civil Case No. Q98-34308 (for cancellation of mortgage) and that of private respondent in her complaint in Civil Case No. Q-98-34349 (for collection of a sum of money).

Civil Case No. Q-98-34308 is a complaint for Cancellation of Mortgage, Delivery of Title and Damages filed on 8 May 1988 by petitioner against private respondent with RTC-Branch 77. Petitioner alleges that he purchased a parcel of land covered by Transfer Certificate of Title No. N-173163 thru private respondent, a real estate broker. In the process of negotiation, petitioner was pressured to sign a Deed of Sale prepared by private respondent. Upon signing the Deed of Sale, he noticed that the Deed was already signed by a certain Cristina Gonzales as attorney-in-fact of vendor Spouses Guillermo and Amparo Galvez. Petitioner demanded from private respondent a special power of attorney and authority to sell, but the latter failed to present one. Petitioner averred that private respondent refused to deliver the certificate of title of the land despite execution and signing of the Deed of Sale and payment of the consideration. Petitioner was thus compelled to engage the services of one Modesto Gazmin, Jr. who agreed, for P100,000.00 to facilitate the filing of cases against private respondent; to deliver to petitioner the certificate of title of the land; and/or to cancel the certificate of title in possession of private respondent. However, Mr. Gazmin, Jr., did nothing upon receipt of the amount of P100,000.00 from petitioner. In fact, petitioner was even charged with perjury before the Office of the City Prosecutor, all because of Mr. Gazmin, Jr.s wrongdoing. Petitioner further alleged that he discovered the existence of a spurious Real Estate Mortgage which he allegedly signed in favor of private respondent. Petitioner categorically denied signing the mortgage document and it was private respondent who falsified the same in order to justify her unlawful withholding of TCT No. N173163 from petitioner. Thus, petitioner prayed for: 1. The cancellation of Real Estate Mortgage dated August 2, 1997 as null and void; 2. As well as to order [herein private respondent] to DELIVER the Owners Duplicate Copy of Transfer Certificate of Title No. N-173163 to [herein petitioner]; 3. Condemning [private respondent] to pay [petitioner] the sums of a) P100,000.00 DAMAGES; b) P50,000.00 DAMAGES; as as MORAL

EXEMPLARY

83

c) P50,000.00 as Attorneys fees and d) Cost of suit. 4. A general relief is likewise prayed for (sic) just and equitable under the premises. Civil Case No. Q-98-34349, on the other hand, is a complaint for a sum of money with a motion for issuance of a writ of attachment filed by private respondent against petitioner on 14 May 1988 before RTC-Branch 84. Private respondent alleges that petitioner obtained a loan from her in the amount of P758,134.42 with a promise to pay on or before 30 August 1997. As security for payment of the loan, petitioner executed a Deed of Real Estate Mortgage covering a parcel of land registered under TCT No. N-173163. Petitioner pleaded for additional time to pay the said obligation, to which respondent agreed. But private respondent discovered sometime in February 1998 that petitioner executed an affidavit of loss alleging that he lost the owners duplicate copy of TCT No. N-173163, and succeeded in annotating said affidavit on the original copy of TCT No. N-173163 on file with the Registry of Deeds of Quezon City. Private respondent further alleges that she also discovered that petitioner filed a petition for issuance of a new owners duplicate copy of TCT No. N-173163 with the RTC of Quezon City, Branch 98, docketed as LRC Case No. Q-10052. Private respondent demanded that petitioner pay his obligation, but the latter refused to do so. Resultantly, private respondent prayed for the following: A. That upon filing of this Complaint as well as the Affidavit of attachment and a preliminary hearing thereon, as well as bond filed, a writ of preliminary attachment is (sic) by the Honorable Court ordering the Sheriff to levy [herein petitioner] property sufficient to answer [herein private respondents] claim in this action; B. That after due notice and hearing, judgment be rendered in [private respondents] favor as against [petitioner], ordering the latter to pay the former the sum of P758,134.42 plus interest thereon at 5% per month from September 1997 up to the date of actual payment; actual damages in the sums of P70,000.00 each under paragraphs 11 and 12 of the complaint; P200,000.00 as moral damages; P100,000.00 as exemplary damages; twenty (20%) of
26

the principal claim as attorneys fees plus P2,500.00 per appearance honorarium; and P60,000.00 as litigation expense before this Honorable Court. [Petitioner] prays for such further relief in law, justice and equity. As to whether it is proper to suspend Criminal Case No. 90721 for perjury pending final outcome of Civil Case No. Q-98-34349 and Civil Case No. Q-98-34308, we take into consideration Sections 6 and 7, Rule 111 of the Revised Rules of Court, which read: Sec. 6. Suspension by reason of prejudicial question. A petition for suspension of the criminal action based upon the pendency of a prejudicial question in a civil action may be filed in the office of the prosecutor or the court conducting the preliminary investigation. When the criminal action has been filed in court for trial, the petition to suspend shall be filed in the same criminal action at any time before the prosecution rests. Sec. 7. Elements of prejudicial question. The elements of a prejudicial question are: (a) the previously instituted civil action involves an issue similar or intimately related to the issue raised in the subsequent criminal action; and (b) the resolution of such issue determines whether or not the criminal action may proceed. The rationale behind the principle of suspending a criminal case in view of a prejudicial question is to avoid two conflicting decisions.27 A prejudial question is defined as that which arises in a case the resolution of which is a logical antecedent of the issue involved therein, and the cognizance of which pertains to another tribunal. The prejudicial question must be determinative of the case before the court but the jurisdiction to try and resolve the question must be lodged in another court or tribunal. It is a question based on a fact distinct and separate from the crime but so intimately connected with it that it determines the guilt or innocence of the accused.28 For a prejudicial question in a civil case to suspend criminal action, it must appear not only that said case involves facts intimately related to those upon which the criminal prosecution would be based but also that in the resolution of the issue or issues raised in the civil case, the guilt or innocence of the accused would necessarily be determined.

84

Thus, for a civil action to be considered prejudicial to a criminal case as to cause the suspension of the criminal proceedings until the final resolution of the civil case, the following requisites must be present: (1) the civil case involves facts intimately related to those upon which the criminal prosecution would be based; (2) in the resolution of the issue or issues raised in the civil action, the guilt or innocence of the accused would necessarily be determined; and (3) jurisdiction to try said question must be lodged in another tribunal.29 If the resolution of the issue in the civil action will not determine the criminal responsibility of the accused in the criminal action based on the same facts, or there is no necessity "that the civil case be determined first before taking up the criminal case," therefore, the civil case does not involve a prejudicial question.30 Neither is there a prejudicial question if the civil and the criminal action can, according to law, proceed independently of each other.31 However, the court in which an action is pending may, in the exercise of sound discretion, and upon proper application for a stay of that action, hold the action in abeyance to abide by the outcome of another case pending in another court, especially where the parties and the issues are the same, for there is power inherent in every court to control the disposition of cases on its dockets with economy of time and effort for itself, for counsel, and for litigants. Where the rights of parties to the second action cannot be properly determined until the questions raised in the first action are settled, the second action should be stayed.32 The power to stay proceedings is incidental to the power inherent in every court to control the disposition of the cases on its dockets, considering its time and effort, those of counsel and the litigants. But if proceedings must be stayed, it must be done in order to avoid multiplicity of suits and prevent vexatious litigations, conflicting judgments, confusion between litigants and courts. It bears stressing that whether or not the trial court would suspend the proceedings in the criminal case before it is submitted to its sound discretion.33 Indeed, a judicial order issued pursuant to the courts discretionary authority is not subject to reversal on review unless it constitutes an abuse of discretion. As the United States Supreme Court aptly declared in Landis v. North American Co., "the burden of making out the justice and wisdom from the departure from the beaten truck lay heavily on the petitioner, less an unwilling litigant is compelled to wait upon

the outcome of a controversy to which he is a stranger. It is, thus, stated that only in rare circumstances will a litigant in one case is compelled to stand aside, while a litigant in another, settling the rule of law that will define the rights of both is, after all, the parties before the court are entitled to a just, speedy and plain determination of their case undetermined by the pendency of the proceedings in another case. After all, procedure was created not to hinder and delay but to facilitate and promote the administration of justice."34 As stated, the determination of whether the proceedings may be suspended on the basis of a prejudicial question rests on whether the facts and issues raised in the pleadings in the civil cases are so related with the issues raised in the criminal case such that the resolution of the issues in the civil cases would also determine the judgment in the criminal case. A perusal of the allegations in the complaints show that Civil Case No. Q-98-34308 pending before RTC-Branch 77, and Civil Case No. Q-9834349, pending before RTC-Branch 84, are principally for the determination of whether a loan was obtained by petitioner from private respondent and whether petitioner executed a real estate mortgage involving the property covered by TCT No. N-173163. On the other hand, Criminal Case No. 90721 before MeTCBranch 43, involves the determination of whether petitioner committed perjury in executing an affidavit of loss to support his request for issuance of a new owners duplicate copy of TCT No. N-173163. It is evident that the civil cases and the criminal case can proceed independently of each other. Regardless of the outcome of the two civil cases, it will not establish the innocence or guilt of the petitioner in the criminal case for perjury. The purchase by petitioner of the land or his execution of a real estate mortgage will have no bearing whatsoever on whether petitioner knowingly and fraudulently executed a false affidavit of loss of TCT No. N-173163. MeTC-Branch 43, therefore, did not err in ruling that the pendency of Civil Case No. Q-98-34308 for cancellation of mortgage before the RTCBranch 77; and Civil Case No. Q-98-34349 for collection of a sum of money before RTC-Branch 84, do not pose a prejudicial question in the determination of whether petitioner is guilty of perjury in Criminal Case No. 90721. RTC-Branch 83, likewise, did not err in ruling that MeTCBranch 43 did not commit grave abuse of discretion in denying petitioners motion for suspension of proceedings in Criminal Case No. 90721.

85

WHEREFORE, premises considered, the assailed Resolutions dated 5 March 2001 and 3 May 2001of the Court of Appeals in CA-G.R. SP No. 63293 are hereby AFFIRMED and the instant petition is DISMISSED for lack of merit. Accordingly, the Metropolitan Trial Court of Quezon City, Branch 43, is hereby directed to proceed with the hearing and trial on the merits of Criminal Case No. 90721, and to expedite proceedings therein, without prejudice to the right of the accused to due process. Costs against petitioner. SO ORDERED G.R. No. 176795 June 30, 2008

fixing of interest, recovery of interest payments"4 and the issuance of a writ of preliminary injunction, alleging that the interest rate of 5% a day is iniquitous, contrary to morals, done under vitiated consent and imposed using undue influence by taking improper advantage of their financial distress. They claimed that due to serious liquidity problems, they were forced to rely on borrowings from banks and individual lenders, including petitioners, and that they had to scramble for funds to cover the maturing postdated checks they issued to cover their other borrowings. In their prayer, respondents stated: WHEREFORE, it is prayed that upon the filing of the instant case and in accordance with the 1997 Rules on Civil Procedure[,] a writ of preliminary injunction or at least a temporary restraining order be issued restraining defendant from enforcing the checks as listed in Annex "E" including the filing of criminal cases for violation of B.P. [Blg.] 22 and restraining defendants from entering plaintiffs store and premises to get cash sales and other items against plaintiffs will [sic] under such terms and conditions as this Court may affix.5 Thereafter, at the instance of Carolina, several cases for violation of B.P. Blg. 226 were filed against respondent Purita before the MTCC of Cebu City, Branches 2 and 5. Purita, in turn filed motions to suspend the criminal proceedings on the ground of prejudicial question, on the theory that the checks subject of the B.P. Blg. 22 cases are void for being contra bonos mores or for having been issued in payment of the iniquitous and unconscionable interest imposed by petitioners. The motions were denied.7 Respondents thereafter filed before the RTC a "Motion for Writ of Preliminary Injunction with Temporary Restraining Order"8 seeking to restrain the MTCCs from further proceeding with the B.P. Blg. 22 cases on the ground of prejudicial question. Petitioners opposed the motion. Nevertheless, the RTC through its 20 December 2004 Order9 issued a writ of preliminary injunction, thereby enjoining the MTCCs from proceeding with the cases against Purita. Petitioners sought reconsideration of the order but their motion was denied due course in the RTCs 3 February 2005 Order.10 Petitioners elevated the case to the Court of Appeals11 and questioned the propriety of the RTCs issuance of a preliminary injunction based on a prejudicial question. The appellate court stated that respondents had sought to annul

SPS. CAROLINA and REYNALDO JOSE, petitioners, vs. SPS. LAUREANO and PURITA SUAREZ, respondents. DECISION TINGA, J.: Petitioners filed this case assailing the Decision1 of the Court of Appeals in CA-G.R. CEB SP No. 00397 dated 17 August 2006 which affirmed the Orders2 of the Regional Trial Court (RTC) of Cebu City, Branch 19 restraining Branches 2 and 5 of the Municipal Trial Court in Cities (MTCC) of Cebu City from proceeding with the criminal cases for violation of Batas Pambansa Bilang 22 (B.P. Blg. 22) filed against respondent Purita Suarez. The facts of the case follow. Respondents, spouses Laureano and Purita Suarez, had availed of petitioner Carolina Joses (Carolina) offer to lend money at the daily interest rate of 1% to 2%. However, Carolina and her husband, petitioner Reynaldo Jose, later on increased the interest to 5% per day, which respondents were forced to accept because they allegedly had no other option left. It then became a practice that petitioners would give the loaned money to Purita and the latter would deposit the same in her and her husbands account to cover the maturing postdated checks they had previously issued in payment of their other loans. Purita would then issue checks in favor of petitioners in payment of the amount borrowed from them with the agreed 5% daily interest. On 7 May 2004, respondents filed a Complaint3 against petitioners seeking the declaration of "nullity of interest of 5% per day,

86

the checks for being void pursuant to Article 1422 of the Civil Code which provides that "a contract which is the direct result of a previous illegal contract, is also void and inexistent." Accordingly, the appellate court concluded that if the checks subject of the criminal cases were later on declared null and void, then said checks could not be made the bases of criminal prosecutions under B.P. Blg. 22. In other words, the outcome of the determination of the validity of the said checks is determinative of guilt or innocence of Purita in the criminal case.12 The appellate court also observed that respondents resort to an application for preliminary injunction could not be considered as forum shopping since it is the only remedy available to them considering the express proscription of filing a petition for certiorari against interlocutory orders issued in cases under B.P. Blg. 22 which are governed by the rules on summary procedure.13 Before us, petitioners submit that because under Section 6, Rule 111 of the Rules on Criminal Procedure a petition to suspend proceedings on the ground of prejudicial question should be filed in the same criminal action, the RTC has no jurisdiction to issue the writ of preliminary injunction as it is not the court where the B.P. Blg. 22 cases were filed. Moreover, they argue that respondents are guilty of forum shopping because after the denial of their motion to suspend the proceedings before Branches 2 and 5 of the MTCC, they resorted to the filing of a motion for preliminary injunction before the RTC also on the ground of prejudicial question; therefore, they succeeded in getting the relief in one forum (RTC) which they had failed to obtain in the first forum (MTCCs). Likewise, petitioners claim that the Court of Appeals erred in holding that the civil case poses a prejudicial question to the B.P. Blg. 22 cases, thus resulting in the erroneous suspension of the proceedings the latter cases. Finally, petitioners posit that the RTC erred in issuing the preliminary injunction because respondents have no clear and unmistakable right to its issuance.14 Respondents, for their part, state that the possibility of a ruling in the civil case to the effect that the subject checks are contra bonos mores and hence null and void constitutes a prejudicial question in the B.P. Blg. 22 cases. Thus, proceeding with the trial in the criminal cases without awaiting the outcome of the civil case is fraught with mischievous consequences.15 They cite the case of Medel v. Court of Appeals,16 wherein the Court nullified the interest rate of 5.5% per month for being contra bonos mores under Article 1306 of

the Civil Code, and recomputed the interest due at the rate of 1% per month.17 Thus, if their loans are computed at 1% per month, it would mean that the checks subject of the B.P. Blg. 22 cases are not only fully paid but are also in fact overpaid. They also invoke the case of Danao v. Court of Appeals18 wherein the Court allegedly ruled that there is no violation of B.P. Blg. 22 if the dishonored checks have been paid. 19 They claim that since the 5% interest per day was not contained in any written agreement, per Article 195620 of the Civil Code, petitioners are bound to return the total interest they collected from respondents. Respondents point out that they incorporated in their complaint an application for preliminary injunction and temporary restraining order to restrain Carolina from enforcing the interest and from filing criminal cases for violation of B.P. Blg. 22. Quoting the RTC, respondents explain: Since there was no proof at that time that plaintiff sustain or are about to sustain damages or prejudice if the acts complained of are not enjoined, the application was not acted upon by the Court. When the attention of the Court was invited by the plaintiffs of the refusal of the MTC, Branches 2 and 5, to suspend the criminal proceedings despite being appraised of the pendency of this case, the Court has to act accordingly.21 Respondents maintain that they are not guilty of forum shopping because after the denial by the MTCCs of their motion to suspend proceedings, their only available remedy was the filing of an application for preliminary injunction in the existing civil case filed earlier than the B.P. Blg. 22 cases. In any case, respondents argue that the rule on forum shopping is not intended to deprive a party to a case of a legitimate remedy. 22 Finally, they claim that the case falls under the exceptions to the rule that the prosecution of criminal cases may not be enjoined by a writ of injunction, considering that in this case there is a prejudicial question which is sub judice, and that there is persecution rather than prosecution.23 The case hinges on the determination of whether there exists a prejudicial question which necessitates the suspension of the proceedings in the MTCCs. We find that there is none and thus we resolve to grant the petition.

87

A prejudicial question generally comes into play in a situation where a civil action and a criminal action are both pending and there exists in the former an issue which must be preemptively resolved before the latter may proceed, because howsoever the issue raised in the civil action is resolved would be determinative juris et de jureof the guilt or innocence of the accused in the criminal case. The rationale behind the principle of prejudicial question is to avoid two conflicting decisions. It has two essential elements: (i) the civil action involves an issue similar or intimately related to the issue raised in the criminal action; and (ii) the resolution of such issue determines whether or not the criminal action may proceed.24 Now the prejudicial question posed by respondents is simply this: whether the daily interest rate of 5% is void, such that the checks issued by respondents to cover said interest are likewise void for being contra bonos mores, and thus the cases for B.P. Blg. 22 will no longer prosper. The prejudicial question theory advanced by respondents must fail. In the first place, the validity or invalidity of the interest rate is not determinative of the guilt of respondents in the criminal cases. The Court has consistently declared that the cause or reason for the issuance of a check is inconsequential in determining criminal culpability under B.P. Blg. 22.25 In several instances, we have held that what the law punishes is the issuance of a bouncing check and not the purpose for which it was issued or the terms and conditions relating to its issuance; and that the mere act of issuing a worthless check is malum prohibitum provided the other elements of the offense are properly proved.26 The nature and policy of B.P. Blg. 22 were aptly enunciated by the Court in Meriz v. People,27 when it stated: x x x. [B.P. Blg.] 22 does not appear to concern itself with what might actually be envisioned by the parties, its primordial intention being to instead ensure the stability and commercial value of checks as being virtual substitutes for currency. It is a policy that can easily be eroded if one has yet to determine the reason for which checks are issued, or the terms and conditions for their issuance, before an appropriate application of the legislative enactment can be made. The gravamen

of the offense under [B.P. Blg.] 22 is the act of making or issuing a worthless check or a check that is dishonored upon presentment for payment. The act effectively declares the offense to be one of malum prohibitum. The only valid query then is whether the law has been breached, i.e., by the mere act of issuing a bad check, without so much regard as to the criminal intent of the issuer.28 Thus, whether or not the interest rate imposed by petitioners is eventually declared void for being contra bonos mores will not affect the outcome of the B.P. Blg. 22 cases because what will ultimately be penalized is the mere issuance of bouncing checks. In fact, the primordial question posed before the court hearing the B.P. Blg. 22 cases is whether the law has been breached, that is, if a bouncing check has been issued. The issue has in fact been correctly addressed by the MTCCs when respondents motion to suspend the criminal proceedings was denied upon the finding that there exists no prejudicial question which could be the basis for the suspension of the proceedings. The reason for the denial of the motion is that the "cases can very well proceed for the prosecution of the accused in order to determine her criminal propensity as a consequence of the issuance of several checks which subsequently bounced" for "what the law punishes is the issuance and/or drawing of a check and upon presentment for deposit or encashment, it was dishonored due to insufficient funds [or] account closed." 29 There being no prejudicial question, the RTC and, consequently, the Court of Appeals gravely erred when they allowed the suspension of the proceedings in the B.P. Blg. 22 cases. Now, on to other matters. We find that respondents are guilty of forum shopping. There is forum shopping when a party seeks to obtain remedies in an action in one court, which had already been solicited, and in other courts and other proceedings in other tribunals. Forum shopping is the act of one party against another, when an adverse judgment has been rendered in one forum, of seeking another and possibly favorable opinion in another forum other than by appeal or by special civil action of certiorari; or the institution of two or more acts or proceedings grounded on the same cause on the supposition that one or the other court would make a favorable disposition.30

88

Respondents filed their motions to suspend proceedings in the MTCCs hearing the B.P. Blg. 22 cases but unfortunately, the same were denied. Failing to get the relief they wanted, respondents sought before the RTC, the suspension of the criminal proceedings which was granted. Respondents tried to extricate themselves from the charge of forum shopping by explaining that after the denial of their motions to suspend, their only remedy was the application for preliminary injunction in the civil casea relief which they had already asked for in their complaint and which was also initially not granted to them. Any which way the situation is viewed, respondents acts constituted forum shopping since they sought a possibly favorable opinion from one court after another had issued an order unfavorable to them. The Court notes that three cases, namely, Ras v. Rasul,31 Medel v. CA32 and Danao v. Court of Appeals33finding no application to the instant casewere mentioned by the RTC, the Court of Appeals and by respondents themselves in support of their position. Ras v. Rasul cropped up in the order of the RTC which was quoted with approval by the Court of Appeals. According to the RTC, the ruling in the said case allegedly "can be squarely applied in this case which nullified and set aside the conviction in a criminal case because of a prejudicial question."34 We do not agree. The Ras case involves a petition for nullification of a deed of sale on the ground of forgery. While the civil case was pending, an information for estafa was filed against the respondent in the civil case. The Court ruled that there were prejudicial questions considering that the defense against the charge of forgery in the civil case is based on the very same facts which would be determinative of the guilt or innocence of the respondent in the estafa case. The instant case is different from Ras inasmuch as the determination of whether the 5% daily interest is contra bonos mores and therefore void, or that the total amount loaned from petitioners has been sufficiently paid, will not affect the guilt or innocence of Purita because the material question in the B.P. Blg. 22 cases is whether Purita had issued a bad check, regardless of the purpose or condition of its issuance. Medel v. CA is the case upon which respondents anchor their claim that the interest due on their loans is only 1% per month and thus they have already overpaid their obligation to petitioners. In Medel, the Court declared that the rate of 5.5% interest per month on a P500,000.00 loan is iniquitous, unconscionable and hence

contrary to morals, and must equitably be reduced to 12% per annum. While the Medel case made a finding that the stipulated interest rate is excessive and thus may be equitably reduced by the courts, we do not see how a reduction of the interest rate, should there be any, or a subsequent declaration that the amount due has been fully paid, will have an effect on the determination of whether or not Purita had in fact issued bouncing checks. Meanwhile, respondents misunderstood our ruling in Danao v. Court of Appeals, which they claim to have ruled that there could be no violation of B.P. Blg. 22 if the dishonored checks have been paid. In Danao, the accused was convicted by the trial court for having issued two checks which eventually bounced. The Court found that there was no proof of receipt by the accused of any notice of nonpayment of the checks, and thus there was no way of determining when the five-day period prescribed in Section 2 of B.P. Blg. 22 would start and end. Thus, the presumption or prima facie evidence of knowledge of the insufficiency of funds or credit at the time of the issuance of the checks did not arise. While there was a finding that the accused had already paid her obligations prior to receipt of the complainants demand letter,35 there was no declaration from the Court that such payment exonerated accused from liability for having issued bouncing checks. Instead, accused was acquitted due to insufficiency of evidence, and not because she had paid the amount covered by the dishonored checks36 or that the obligation was deemed paid. WHEREFORE, the petition is GRANTED. The impugned Decision of the Court of Appeals dated 17 August 2006 and its Resolution dated 27 February 2007, in CA-G.R. CEB-SP No. 00397, are SET ASIDE. The preliminary injunction issued by the Regional Trial Court of Cebu City, Branch 19 in its Order dated 20 December 2004 in Civil Case No. CEB-30278 enjoining the proceedings in the criminal cases for violation of B.P. Blg. 22 is LIFTED ANDSET ASIDE and the MTCC of Cebu City, Branches 2 and 5 are ORDERED to proceed with dispatch with the arraignment and trial in the B.P. Blg. 22 cases pending before them. SO ORDERED.

89

G.R. No. 184861

June 30, 2009

DREAMWORK CONSTRUCTION, INC., Petitioner, vs. CLEOFE S. JANIOLA and HON. ARTHUR A. FAMINI, Respondents. DECISION VELASCO, JR., J.: The Case Petitioner Dreamwork Construction, Inc. seeks the reversal of the August 26, 2008 Decision1 in SCA No. 08-0005 of the Regional Trial Court (RTC), Branch 253 in Las Pias City. The Decision affirmed the Orders dated October 16, 20072 and March 12, 20083 in Criminal Case Nos. 55554-61 issued by the Metropolitan Trial Court (MTC), Branch 79 in Las Pias City. The Facts On October 18, 2004, petitioner, through its President, Roberto S. Concepcion, and VicePresident for Finance and Marketing, Normandy P. Amora, filed a Complaint Affidavit dated October 5, 20044 for violation of Batas Pambansa Bilang 22 (BP 22) against private respondent Cleofe S. Janiola with the Office of the City Prosecutor of Las Pias City. The case was docketed as I.S. No. 04-2526-33. Correspondingly, petitioner filed a criminal information for violation of BP 22 against private respondent with the MTC on February 2, 2005 docketed as Criminal Case Nos. 55554-61, entitled People of the Philippines v. Cleofe S. Janiola. On September 20, 2006, private respondent, joined by her husband, instituted a civil complaint against petitioner by filing a Complaint dated August 20065 for the rescission of an alleged construction agreement between the parties, as well as for damages. The case was filed with the RTC, Branch 197 in Las Pias City and docketed as Civil Case No. LP-06-0197. Notably, the checks, subject of the criminal cases before the MTC, were issued in consideration of the construction agreement. Thereafter, on July 25, 2007, private respondent filed a Motion to Suspend Proceedings dated July 24, 20076 in Criminal Case Nos. 55554-61, alleging that the civil and criminal cases involved facts and issues similar or intimately related such that in the resolution of the issues

in the civil case, the guilt or innocence of the accused would necessarily be determined. In other words, private respondent claimed that the civil case posed a prejudicial question as against the criminal cases. Petitioner opposed the suspension of the proceedings in the criminal cases in an undated Comment/Opposition to Accuseds Motion to Suspend Proceedings based on Prejudicial Question7 on the grounds that: (1) there is no prejudicial question in this case as the rescission of the contract upon which the bouncing checks were issued is a separate and distinct issue from the issue of whether private respondent violated BP 22; and (2) Section 7, Rule 111 of the Rules of Court states that one of the elements of a prejudicial question is that "the previously instituted civil action involves an issue similar or intimately related to the issue raised in the subsequent criminal action"; thus, this element is missing in this case, the criminal case having preceded the civil case. Later, the MTC issued its Order dated October 16, 2007, granting the Motion to Suspend Proceedings, and reasoned that: Should the trial court declare the rescission of contract and the nullification of the checks issued as the same are without consideration, then the instant criminal cases for alleged violation of BP 22 must be dismissed. The belated filing of the civil case by the herein accused did not detract from the correctness of her cause, since a motion for suspension of a criminal action may be filed at any time before the prosecution rests (Section 6, Rule 111, Revised Rules of Court).8 In an Order dated March 12, 2008, 9 the MTC denied petitioners Motion for Reconsideration dated November 29, 2007. Petitioner appealed the Orders to the RTC with a Petition dated May 13, 2008. Thereafter, the RTC issued the assailed decision dated August 26, 2008, denying the petition. On the issue of the existence of a prejudicial question, the RTC ruled: Additionally, it must be stressed that the requirement of a "previously" filed civil case is intended merely to obviate delays in the conduct of the criminal proceedings. Incidentally, no clear evidence of any intent to delay by private respondent was shown. The criminal proceedings are still in their initial stages when the civil action was instituted. And, the fact that the civil action was filed after the criminal action was instituted does not render

90

the issues in the civil action any less prejudicial in character.10 Hence, we have this petition under Rule 45. The Issue WHETHER OR NOT THE COURT A QUO SERIOUSLY ERRED IN NOT PERCEIVING GRAVE ABUSE OF DISCRETION ON THE PART OF THE INFERIOR COURT, WHEN THE LATTER RULED TO SUSPEND PROCEEDINGS IN CRIM. CASE NOS. 55554-61 ON THE BASIS OF "PREJUDICIAL QUESTION" IN CIVIL CASE NO. LP-06-0197.11 The Courts Ruling This petition must be granted. The Civil Action Must Precede the Filing of the Criminal Action for a Prejudicial Question to Exist Under the 1985 Rules on Criminal Procedure, as amended by Supreme Court Resolutions dated June 17, 1988 and July 7, 1988, the elements of a prejudicial question are contained in Rule 111, Sec. 5, which states: SEC. 5. Elements of prejudicial question. The two (2) essential elements of a prejudicial question are: (a) the civil action involves an issue similar or intimately related to the issue raised in the criminal action; and (b) the resolution of such issue determines whether or not the criminal action may proceed. Thus, the Court has held in numerous cases12 that the elements of a prejudicial question, as stated in the above-quoted provision and in Beltran v. People,13 are: The rationale behind the principle of prejudicial question is to avoid two conflicting decisions. It has two essential elements: (a) the civil action involves an issue similar or intimately related to the issue raised in the criminal action; and (b) the resolution of such issue determines whether or not the criminal action may proceed. On December 1, 2000, the 2000 Rules on Criminal Procedure, however, became effective and the above provision was amended by Sec. 7 of Rule 111, which applies here and now provides: SEC. 7. Elements of prejudicial question.The elements of a prejudicial question are: (a) the previously instituted civil action involves an

issue similar or intimately related to the issue raised in the subsequent criminal action, and (b) the resolution of such issue determines whether or not the criminal action may proceed. (Emphasis supplied.) Petitioner interprets Sec. 7(a) to mean that in order for a civil case to create a prejudicial question and, thus, suspend a criminal case, it must first be established that the civil case was filed previous to the filing of the criminal case. This, petitioner argues, is specifically to guard against the situation wherein a party would belatedly file a civil action that is related to a pending criminal action in order to delay the proceedings in the latter. On the other hand, private respondent cites Article 36 of the Civil Code which provides: Art. 36. Pre-judicial questions which must be decided before any criminal prosecution may be instituted or may proceed, shall be governed by rules of court which the Supreme Court shall promulgate and which shall not be in conflict with the provisions of this Code. (Emphasis supplied.) Private respondent argues that the phrase "before any criminal prosecution may be instituted or may proceed" must be interpreted to mean that a prejudicial question exists when the civil action is filed either before the institution of the criminal action or during the pendency of the criminal action. Private respondent concludes that there is an apparent conflict in the provisions of the Rules of Court and the Civil Code in that the latter considers a civil case to have presented a prejudicial question even if the criminal case preceded the filing of the civil case. We cannot agree with private respondent. First off, it is a basic precept in statutory construction that a "change in phraseology by amendment of a provision of law indicates a legislative intent to change the meaning of the provision from that it originally had." 14 In the instant case, the phrase, "previously instituted," was inserted to qualify the nature of the civil action involved in a prejudicial question in relation to the criminal action. This interpretation is further buttressed by the insertion of "subsequent" directly before the term criminal action. There is no other logical explanation for the amendments except to qualify the relationship of the civil and criminal actions, that the civil action must precede the criminal action.

91

Thus, this Court Garchitorena15 that:

ruled

in

Torres

v.

when harmonization is impossible that resort must be made to choosing which law to apply. In the instant case, Art. 36 of the Civil Code and Sec. 7 of Rule 111 of the Rules of Court are susceptible of an interpretation that would harmonize both provisions of law. The phrase "previously instituted civil action" in Sec. 7 of Rule 111 is plainly worded and is not susceptible of alternative interpretations. The clause "before any criminal prosecution may be instituted or may proceed" in Art. 36 of the Civil Code may, however, be interpreted to mean that the motion to suspend the criminal action may be filed during the preliminary investigation with the public prosecutor or court conducting the investigation, or during the trial with the court hearing the case. This interpretation would harmonize Art. 36 of the Civil Code with Sec. 7 of Rule 111 of the Rules of Court but also with Sec. 6 of Rule 111 of the Civil Code, which provides for the situations when the motion to suspend the criminal action during the preliminary investigation or during the trial may be filed. Sec. 6 provides: SEC. 6. Suspension by reason of prejudicial question.A petition for suspension of the criminal action based upon the pendency of a prejudicial question in a civil action may be filed in the office of the prosecutor or the court conducting the preliminary investigation. When the criminal action has been filed in court for trial, the petition to suspend shall be filed in the same criminal action at any time before the prosecution rests. Thus, under the principles of statutory construction, it is this interpretation of Art. 36 of the Civil Code that should govern in order to give effect to all the relevant provisions of law. It bears pointing out that the circumstances present in the instant case indicate that the filing of the civil action and the subsequent move to suspend the criminal proceedings by reason of the presence of a prejudicial question were a mere afterthought and instituted to delay the criminal proceedings. In Sabandal v. Tongco, 18 we found no prejudicial question existed involving a civil action for specific performance, overpayment, and damages, and a criminal complaint for BP 22, as the resolution of the civil action would not determine the guilt or innocence of the accused in the criminal case. In resolving the case, we said:

Even if we ignored petitioners procedural lapse and resolved their petition on the merits, we hold that Sandiganbayan did not abuse its discretion amounting to excess or lack of jurisdiction in denying their omnibus motion for the suspension of the proceedings pending final judgment in Civil Case No. 7160. Section 6, Rule lll of the Rules of Criminal Procedure, as amended, reads: Sec. 6. Suspension by reason of prejudicial question. - A petition for suspension of the criminal action based upon the pendency of a prejudicial question in a civil action may be filed in the office of the prosecutor or the court conducting the preliminary investigation. When the criminal action has been filed in court for trial, the petition to suspend shall be filed in the same criminal action at any time before the prosecution rests. Sec. 7. Elements of prejudicial question. - The elements of a prejudicial question are: (a) the previously instituted civil action involves an issue similar or intimately related to the issue raised in the subsequent criminal action, and (b) the resolution of such issue determines whether or not the criminal action may proceed. Under the amendment, a prejudicial question is understood in law as that which must precede the criminal action and which requires a decision before a final judgment can be rendered in the criminal action with which said question is closely connected. The civil action must be instituted prior to the institution of the criminal action. In this case, the Information was filed with the Sandiganbayan ahead of the complaint in Civil Case No. 7160 filed by the State with the RTC in Civil Case No. 7160. Thus, no prejudicial question exists. (Emphasis supplied.) Additionally, it is a principle in statutory construction that "a statute should be construed not only to be consistent with itself but also to harmonize with other laws on the same subject matter, as to form a complete, coherent and intelligible system."16 This principle is consistent with the maxim, interpretare et concordare leges legibus est optimus interpretandi modus or every statute must be so construed and harmonized with other statutes as to form a uniform system of jurisprudence.171 a vv p h i l In other words, every effort must be made to harmonize seemingly conflicting laws. It is only

92

Furthermore, the peculiar circumstances of the case clearly indicate that the filing of the civil case was a ploy to delay the resolution of the criminal cases. Petitioner filed the civil case three years after the institution of the criminal charges against him. Apparently, the civil action was instituted as an afterthought to delay the proceedings in the criminal cases.19 Here, the civil case was filed two (2) years after the institution of the criminal complaint and from the time that private respondent allegedly withdrew its equipment from the job site. Also, it is worth noting that the civil case was instituted more than two and a half (2 ) years from the time that private respondent allegedly stopped construction of the proposed building for no valid reason. More importantly, the civil case praying for the rescission of the construction agreement for lack of consideration was filed more than three (3) years from the execution of the construction agreement. Evidently, as in Sabandal, the circumstances surrounding the filing of the cases involved here show that the filing of the civil action was a mere afterthought on the part of private respondent and interposed for delay. And as correctly argued by petitioner, it is this scenario that Sec. 7 of Rule 111 of the Rules of Court seeks to prevent. Thus, private respondents positions cannot be left to stand. The Resolution of the Civil Case Is Not Determinative of the Prosecution of the Criminal Action In any event, even if the civil case here was instituted prior to the criminal action, there is, still, no prejudicial question to speak of that would justify the suspension of the proceedings in the criminal case. To reiterate, the elements of a prejudicial question under Sec. 7 of Rule 111 of the Rules of Court are: (1) the previously instituted civil action involves an issue similar or intimately related to the issue raised in the subsequent criminal action; and (2) the resolution of such issue determines whether or not the criminal action may proceed. Petitioner argues that the second element of a prejudicial question, as provided in Sec. 7 of Rule 111 of the Rules, is absent in this case. Thus, such rule cannot apply to the present controversy. Private respondent, on the other hand, claims that if the construction agreement between the

parties is declared null and void for want of consideration, the checks issued in consideration of such contract would become mere scraps of paper and cannot be the basis of a criminal prosecution. We find for petitioner. It must be remembered that the elements of the crime punishable under BP 22 are as follows: (1) the making, drawing, and issuance of any check to apply for account or for value; (2) the knowledge of the maker, drawer, or issuer that at the time of issue there are no sufficient funds in or credit with the drawee bank for the payment of such check in full upon its presentment; and (3) the subsequent dishonor of the check by the drawee bank for insufficiency of funds or credit, or dishonor for the same reason had not the drawer, without any valid cause, ordered the bank to stop payment.20 Undeniably, the fact that there exists a valid contract or agreement to support the issuance of the check/s or that the checks were issued for valuable consideration does not make up the elements of the crime. Thus, this Court has held in a long line of cases21 that the agreement surrounding the issuance of dishonored checks is irrelevant to the prosecution for violation of BP 22. In Mejia v. People,22 we ruled: It must be emphasized that the gravamen of the offense charge is the issuance of a bad check. The purpose for which the check was issued, the terms and conditions relating to its issuance, or any agreement surrounding such issuance are irrelevant to the prosecution and conviction of petitioner. To determine the reason for which checks are issued, or the terms and conditions for their issuance, will greatly erode the faith the public reposes in the stability and commercial value of checks as currency substitutes, and bring havoc in trade and in banking communities. The clear intention of the framers of B.P. 22 is to make the mere act of issuing a worthless check malum prohibitum. Lee v. Court of Appeals23 is even more poignant. In that case, we ruled that the issue of lack of valuable consideration for the issuance of checks which were later on dishonored for

93

insufficient funds is immaterial to the success of a prosecution for violation of BP 22, to wit: Third issue. Whether or not the check was issued on account or for value. Petitioners claim is not feasible. We have held that upon issuance of a check, in the absence of evidence to the contrary, it is presumed that the same was issued for valuable consideration. Valuable consideration, in turn, may consist either in some right, interest, profit or benefit accruing to the party who makes the contract, or some forbearance, detriment, loss or some responsibility, to act, or labor, or service given, suffered or undertaken by the other side. It is an obligation to do, or not to do in favor of the party who makes the contract, such as the maker or indorser. In this case, petitioner himself testified that he signed several checks in blank, the subject check included, in exchange for 2.5% interest from the proceeds of loans that will be made from said account. This is a valuable consideration for which the check was issued. That there was neither a pre-existing obligation nor an obligation incurred on the part of petitioner when the subject check was given by Bautista to private complainant on July 24, 1993 because petitioner was no longer connected with Unlad or Bautista starting July 1989, cannot be given merit since, as earlier discussed, petitioner failed to adequately prove that he has severed his relationship with Bautista or Unlad. At any rate, we have held that what the law punishes is the mere act of issuing a bouncing check, not the purpose for which it was issued nor the terms and conditions relating to its issuance. This is because the thrust of the law is to prohibit the making of worthless checks and putting them into circulation.24 (Emphasis supplied.) Verily, even if the trial court in the civil case declares that the construction agreement between the parties is void for lack of consideration, this would not affect the prosecution of private respondent in the criminal case. The fact of the matter is that private respondent indeed issued checks which were subsequently dishonored for insufficient funds. It is this fact that is subject of prosecution under BP 22.lawphil.net Therefore, it is clear that the second element required for the existence of a prejudicial question, that the resolution of the issue in the civil action would determine whether the

criminal action may proceed, is absent in the instant case. Thus, no prejudicial question exists and the rules on it are inapplicable to the case before us. WHEREFORE, we GRANT this petition. We hereby REVERSE and SET ASIDE the August 26, 2008 Decision in SCA No. 08-0005 of the RTC, Branch 253 in Las Pias City and the Orders dated October 16, 2007 and March 12, 2008 in Criminal Case Nos. 55554-61 of the MTC, Branch 79 in Las Pias City. We order the MTC to continue with the proceedings in Criminal Case Nos. 55554-61 with dispatch. No costs. SO ORDERED. G.R. No. 183788 April 5, 2010

KRIZIA KATRINA TY-DE ZUZUARREGUI, Petitioner, vs. THE HON. JOSELITO C. VILLAROSA, in his capacity as Presiding Judge of Branch 66 of the RTC of Makati City, and FANNIE TORRES-TY, Respondents. DECISION VILLARAMA, JR., J.: This is a petition for review on certiorari 1 under Rule 45 of the 1997 Rules of Civil Procedure, as amended, assailing the Resolutions dated August 23, 20072 and July 14, 20083 of the Court of Appeals in CA-G.R. SP No. 98978. The Court of Appeals dismissed the petition for certiorari and prohibition filed by petitioner seeking the reversal of the November 16, 2006 and March 9, 2007 Orders 4 of the Regional Trial Court (RTC) of Makati City, Branch 66, which found that there was no prejudicial question to warrant the suspension of the criminal actions against petitioner. The following facts are established: Sometime in August 2000, Rosemary Torres TyRasekhi (Rosemary), the sister of petitioners late father Alexander Torres Ty, filed a petition for the issuance of letters of administration of the estate of her mother, Bella Torres (Bella), before the RTC of Pasig City.5 Petitioner initially opposed6 Rosemarys petition, but they eventually reached an amicable settlement and entered into a compromise agreement which they submitted to the RTC for approval. 7 In a

94

Decision8 dated November 19, 2002, the RTC approved the compromise agreement. Subsequently, two (2) of Rosemarys alleged siblings, Peter Torres Ty (Peter) and Catherine Torres Ty-Chavez (Catherine), filed with the Court of Appeals a Petition to Annul Judgment Approving Compromise Agreement, docketed as CA-G.R. SP No. 87222.9 Peter and Catherine claimed that they are also biological children of the late Bella, and are entitled to participate in the settlement of the latters estate. Later, private respondent Fannie Torres-Ty (Fannie), who likewise claimed to be a biological child of the late Bella and therefore also entitled to inherit from her, filed a petition-in-intervention in the action for annulment of judgment.10 Peter, Catherine, and Fannie alleged that upon the death of Bella, they held a number of discussions pertaining to the settlement of the latters estate. Rosemary, their elder sister, promised to take care of the processing of papers so that the estate may be divided among them in the manner provided by law. However, in subsequent discussions, Rosemary made known to them her intention to get a disproportionately larger share of the estate, but they did not agree. No agreement was reached and as far as they know, no progress was made towards the settlement of Bellas estate. They were not aware that Rosemary had filed a petition for the issuance of letters of administration and that a judgment by compromise agreement was rendered by the RTC of Pasig City. Rosemary had falsely averred that aside from herself, petitioner, who was her niece, was the only other heir of Bella. In petitioners opposition, it was likewise averred that petitioner and Rosemary were the only heirs of Bella. The subsequent compromise agreement contained similar averments, and it was not disclosed that Peter, Catherine, and Fannie were also Bellas heirs. It was only sometime in June 2004 that they came to know of the decision by compromise agreement of the Pasig City RTC. Petitioner and Rosemary filed their answers 11 to the petition for annulment of judgment and the petition-in-intervention. They raised similar defenses. They denied that Peter, Catherine, and Fannie were heirs of Bella for, as far as they knew, the three (3) were literally purchased from third persons who represented to Bella and the latters common-law husband, Alejandro Ty, that they were abandoned children. Bella and Alejandro took pity on the three (3) and brought them up as their own. This was known within the family circle, but was not disclosed to Peter, Catherine, and Fannie in order to protect them from the stigma of

knowing they were unwanted children. However, Alejandro and Bella did not legally adopt them; hence, they were never conferred the rights of legitimate children. While the action for annulment of judgment was pending before the Court of Appeals, Fannie filed a complaint12for falsification and perjury against petitioner and Rosemary. Fannie alleged that petitioner and Rosemary falsely and maliciously stated in the pertinent pleadings filed before the RTC of Pasig City that the late Bella had only two (2) heirs, namely the two (2) of them. Petitioner and Rosemary forthwith filed a joint motion to suspend the preliminary investigation on the ground of a pending prejudicial question before the Court of Appeals.13 They argued that the issue of whether Peter, Catherine, and Fannie are related to Bella and therefore legal heirs of the latter was pending before the Court of Appeals. The investigating prosecutor denied the joint motion and found probable cause against petitioner and Rosemary for two (2) counts each of falsification of public documents. 14The prosecutor held that the issue before the Court of Appeals is the validity of the compromise agreement which is not determinative of the criminal case which involves the liability of petitioner and Rosemary for falsification, allegedly for willfully making the false statements in the opposition to the petition for letters of administration and in the subsequent compromise agreement filed before the RTC of Pasig City. On December 20, 2005, three (3) informations15 against petitioner and Rosemary were thus filed with the Metropolitan Trial Court (MeTC) of Makati City, Branch 61. Petitioner filed a petition for review16 with the Department of Justice (DOJ) and a motion to defer proceedings17before the MeTC on the ground of the pending appeal before the DOJ. Also, petitioner and Rosemary filed with the MeTC separate motions to suspend proceedings on the ground of prejudicial question.18 However, petitioners appeal was dismissed by the DOJ,19 while her motions before the MeTC were denied by the said court.20 The MeTC agreed with the prosecutor that the issue before the Court of Appeals in the action for annulment of judgment is the validity of the compromise agreement while the criminal case involves their liability for falsification of public documents. The MeTC also denied petitioners motion for reconsideration. 21 Aggrieved, petitioner filed a petition for certiorari and prohibition22 with the RTC of Makati City, Branch 66. In an Order23 dated

95

November 16, 2006, the RTC denied the petition on the ground that there was no prejudicial question; hence, the MeTC did not act with grave abuse of discretion in denying petitioners motion to suspend proceedings. The RTC held that there was no prejudicial question as the quantum of evidence in the civil action for annulment of judgment differs from the quantum of evidence required in the criminal action for falsification of public documents. Petitioners motion for reconsideration24 was also denied by the RTC in its Order 25 dated March 9, 2007.1avvphi1 Undaunted, petitioner filed a petition for certiorari and prohibition before the Court of Appeals assailing the RTCs orders. In its August 23, 2007 Resolution,26 the appellate court dismissed the petition on the ground that the certification of non-forum shopping was signed only by petitioners counsel and not by petitioner herself. Petitioners motion for reconsideration was also denied in the July 14, 2008 Resolution27 of the Court of Appeals. Hence, the present recourse. Petitioner alleges that: I THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN DISMISSING THE PETITION FOR CERTIORARI ON THE GROUND THAT THE CERTIFICATION OF NON-FORUM SHOPPING WAS SIGNED BY COUNSEL ALLEGEDLY IN VIOLATION OF SEC. 3, RULE 46, IN RELATION TO SEC. 1 RULE 65, 1997 RULES OF CIVIL PROCEDURE. II THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN NOT NULLIFYING THE ASSAILED ORDERS OF PUBLIC RESPONDENT JOSELITO VILLAROSA ON THE GROUND THAT THE SAME WAS ISSUED WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF OR EXCESS OF JURISDICTION.28 The petition is meritorious. Under Rule 46, Section 3, paragraph 3 of the 1997 Rules of Civil Procedure, as amended, petitions for certiorari must be verified and accompanied by a sworn certification of nonforum shopping.29 The primary question that has to be resolved in this case is whether the verification and certification of non-forum shopping, erroneously signed by counsel, may be cured by subsequent compliance.30

Generally, subsequent compliance with the requirement of a certification of non-forum shopping does not excuse a party from failure to comply in the first instance.31 A certification of the plaintiffs counsel will not suffice for the reason that it is the petitioner, and not the counsel, who is in the best position to know whether he actually filed or caused the filing of a petition.32 A certification against forum shopping signed by counsel is a defective certification that is equivalent to noncompliance with the requirement and constitutes a valid cause for the dismissal of the petition.33 However, there are instances when we treated compliance with the rule with relative liberality, especially when there are circumstances or compelling reasons making the strict application of the rule clearly unjustified. 34 In the case of Far Eastern Shipping Company v. Court of Appeals,35 while we said that, strictly, a certification against forum shopping by counsel is a defective certification, the verification, signed by petitioners counsel in said case, is substantial compliance inasmuch as it served the purpose of the Rules of informing the Court of the pendency of another action or proceeding involving the same issues. We then explained that procedural rules are instruments in the speedy and efficient administration of justice which should be used to achieve such end and not to derail it.36 In Sy Chin v. Court of Appeals ,37 we categorically stated that while the petition was flawed as the certification of non-forum shopping was signed only by counsel and not by the party, such procedural lapse may be overlooked in the interest of substantial justice.38 Finally, the Court has also on occasion held that the party need not sign the verification; a partys representative, lawyer or any person who personally knows the truth of the facts alleged in the pleading may sign the verification.39 Here, the verification and certification of nonforum shopping was signed by petitioners counsel. Upon receipt of the resolution of the Court of Appeals dismissing her petition for noncompliance with the rules, petitioner submitted, together with her motion for reconsideration, a verification and certification signed by her in compliance with the said rule.40 We deem this to be sufficient compliance especially in view of the merits of the case, which may be considered as a special circumstance or a compelling reason that would justify tempering the hard consequence of the procedural requirement on non-forum shopping.41

96

On the second assignment of error that the Court of Appeals erred in denying petitioners prayer for a writ of certiorari and prohibition, we likewise find for petitioner. Under Rule 111 of the Revised Rules of Criminal Procedure, as amended, a criminal action may be suspended upon the pendency of a prejudicial question in a civil action, to wit: SEC. 6. Suspension by reason of prejudicial question. - A petition for suspension of the criminal action based upon the pendency of a prejudicial question in a civil action may be filed in the office of the prosecutor or the court conducting the preliminary investigation. When the criminal action has been filed in court for trial, the petition to suspend shall be filed in the same criminal action at any time before the prosecution rests. For a prejudicial question in a civil case to suspend a criminal action, it must appear not only that said civil case involves facts intimately related to those upon which the criminal prosecution would be based, but also that in the resolution of the issue or issues raised in the civil case, the guilt or innocence of the accused would necessarily be determined.42 The rationale behind the principle of prejudicial question is to avoid two (2) conflicting decisions. Thus, for a civil action to be considered prejudicial to a criminal case as to cause the suspension of the criminal proceedings until the final resolution of the civil case, the following requisites must be present: (1) the civil case involves facts intimately related to those upon which the criminal prosecution would be based; (2) in the resolution of the issue or issues raised in the civil action, the guilt or innocence of the accused would necessarily be determined; and (3) jurisdiction to try said question must be lodged in another tribunal.43 If the resolution of the issue in the civil action will not determine the criminal responsibility of the accused in the criminal action based on the same facts, or there is no necessity "that the civil case be determined first before taking up the criminal case," the civil case does not involve a prejudicial question.44 Neither is there a prejudicial question if the civil and the criminal action can, according to law, proceed independently of each other.45 As stated, the determination of whether the proceedings may be suspended on the basis of a prejudicial question rests on whether the facts and issues raised in the pleadings in the civil

case are so related with the issues raised in the criminal case such that the resolution of the issues in the civil case would also determine the judgment in the criminal case. A perusal of the allegations in the petition to annul judgment shows that CA-G.R. SP No. 87222 pending before the Court of Appeals is principally for the determination of the validity of the compromise agreement which did not include Peter, Catherine, and Fannie as heirs of Bella. Peter, Catherine, and Fannie presented evidence to prove that they are also biological children of Bella and Alejandro. On the other hand, Criminal Case Nos. 343812 to 343814 before the MeTC involve the determination of whether petitioner committed falsification of public documents in executing pleadings containing untruthful statements that she and Rosemary were the only legal heirs of Bella. It is evident that the result of the civil case will determine the innocence or guilt of the petitioner in the criminal cases for falsification of public documents. The criminal cases arose out of the claim of Peter, Catherine, and Fannie that they are also the legal heirs of Bella. If it is finally adjudged in the civil case that they are not biological children of the late Bella and consequently not entitled to a share in her estate as heirs, there is no more basis to proceed with the criminal cases against petitioner who could not have committed falsification in her pleadings filed before the RTC of Pasig City, the truth of her statements regarding the filiation of Peter, Catherine and Fannie having been judicially settled. WHEREFORE, the petition is GRANTED. The Resolutions dated August 23, 2007 and July 14, 2008 of the Court of Appeals in CA-G.R. SP No. 98978 are hereby REVERSED and SET ASIDE. The criminal proceedings against petitioner Krizia Katrina Ty-De Zuzuarregui in Criminal Case Nos. 343812 to 343814 before the Metropolitan Trial Court of Makati City, Branch 61 are hereby ordered SUSPENDED until the final resolution of CA-G.R. SP No. 87222. No costs. SO ORDERED. G.R. No. 172060 2010 September 13,

JOSELITO R. PIMENTEL, Petitioner, vs. MARIA CHRYSANTINE L. PIMENTEL and PEOPLE OF THE PHILIPPINES, Respondents.

97

DECISION CARPIO, J.: The Case Before the Court is a petition for review1 assailing the Decision2 of the Court of Appeals, promulgated on 20 March 2006, in CAG.R. SP No. 91867. The Antecedent Facts The facts are stated in the Court of Appeals decision: On 25 October 2004, Maria Chrysantine Pimentel y Lacap (private respondent) filed an action for frustrated parricide against Joselito R. Pimentel (petitioner), docketed as Criminal Case No. Q-04-130415, before the Regional Trial Court of Quezon City, which was raffled to Branch 223 (RTC Quezon City). On 7 February 2005, petitioner received summons to appear before the Regional Trial Court of Antipolo City, Branch 72 (RTC Antipolo) for the pre-trial and trial of Civil Case No. 047392 (Maria Chrysantine Lorenza L. Pimentel v. Joselito Pimentel) for Declaration of Nullity of Marriage under Section 36 of the Family Code on the ground of psychological incapacity. On 11 February 2005, petitioner filed an urgent motion to suspend the proceedings before the RTC Quezon City on the ground of the existence of a prejudicial question. Petitioner asserted that since the relationship between the offender and the victim is a key element in parricide, the outcome of Civil Case No. 04-7392 would have a bearing in the criminal case filed against him before the RTC Quezon City. The Decision of the Trial Court The RTC Quezon City issued an Order dated 13 May 20053 holding that the pendency of the case before the RTC Antipolo is not a prejudicial question that warrants the suspension of the criminal case before it. The RTC Quezon City held that the issues in Criminal Case No. Q-04130415 are the injuries sustained by respondent and whether the case could be tried even if the validity of petitioners marriage with respondent is in question. The RTC Quezon City ruled: WHEREFORE, on the basis of the foregoing, the Motion to Suspend Proceedings On the [Ground]

of the Existence of a Prejudicial Question is, for lack of merit, DENIED. SO ORDERED.4 Petitioner filed a motion for reconsideration. In its 22 August 2005 Order,5 the RTC Quezon City denied the motion. Petitioner filed a petition for certiorari with application for a writ of preliminary injunction and/or temporary restraining order before the Court of Appeals, assailing the 13 May 2005 and 22 August 2005 Orders of the RTC Quezon City. The Decision of the Court of Appeals In its 20 March 2006 Decision, the Court of Appeals dismissed the petition. The Court of Appeals ruled that in the criminal case for frustrated parricide, the issue is whether the offender commenced the commission of the crime of parricide directly by overt acts and did not perform all the acts of execution by reason of some cause or accident other than his own spontaneous desistance. On the other hand, the issue in the civil action for annulment of marriage is whether petitioner is psychologically incapacitated to comply with the essential marital obligations. The Court of Appeals ruled that even if the marriage between petitioner and respondent would be declared void, it would be immaterial to the criminal case because prior to the declaration of nullity, the alleged acts constituting the crime of frustrated parricide had already been committed. The Court of Appeals ruled that all that is required for the charge of frustrated parricide is that at the time of the commission of the crime, the marriage is still subsisting. Petitioner filed a petition for review before this Court assailing the Court of Appeals decision. The Issue The only issue in this case is whether the resolution of the action for annulment of marriage is a prejudicial question that warrants the suspension of the criminal case for frustrated parricide against petitioner.

The Ruling of this Court The petition has no merit. Civil Case Must be Before the Criminal Case Instituted

98

Section 7, Rule 111 of the 2000 Rules on Criminal Procedure6 provides: Section 7. Elements of Prejudicial Question. The elements of a prejudicial question are: (a) the previously instituted civil action involves an issue similar or intimately related to the issue raised in the subsequent criminal action and (b) the resolution of such issue determines whether or not the criminal action may proceed. The rule is clear that the civil action must be instituted first before the filing of the criminal action. In this case, the Information 7 for Frustrated Parricide was dated 30 August 2004. It was raffled to RTC Quezon City on 25 October 2004 as per the stamped date of receipt on the Information. The RTC Quezon City set Criminal Case No. Q-04-130415 for pre-trial and trial on 14 February 2005. Petitioner was served summons in Civil Case No. 04-7392 on 7 February 2005.8 Respondents petition9 in Civil Case No. 04-7392 was dated 4 November 2004 and was filed on 5 November 2004. Clearly, the civil case for annulment was filed after the filing of the criminal case for frustrated parricide. As such, the requirement of Section 7, Rule 111 of the 2000 Rules on Criminal Procedure was not met since the civil action was filed subsequent to the filing of the criminal action. Annulment of Marriage is not a Prejudicial Question in Criminal Case for Parricide Further, the resolution of the civil action is not a prejudicial question that would warrant the suspension of the criminal action. There is a prejudicial question when a civil action and a criminal action are both pending, and there exists in the civil action an issue which must be preemptively resolved before the criminal action may proceed because howsoever the issue raised in the civil action is resolved would be determinative of the guilt or innocence of the accused in the criminal case.10 A prejudicial question is defined as: x x x one that arises in a case the resolution of which is a logical antecedent of the issue involved therein, and the cognizance of which pertains to another tribunal. It is a question based on a fact distinct and separate from the crime but so intimately connected with it that it determines the guilt or innocence of the accused, and for it to suspend the criminal action, it must appear not only that said case involves facts intimately related to those upon which the criminal prosecution would be based but also that in the resolution of the issue or

issues raised in the civil case, the guilt or innocence of the accused would necessarily be determined.11 The relationship between the offender and the victim is a key element in the crime of parricide,12 which punishes any person "who shall kill his father, mother, or child, whether legitimate or illegitimate, or any of his ascendants or descendants, or his spouse."13 The relationship between the offender and the victim distinguishes the crime of parricide from murder14 or 15 homicide. However, the issue in the annulment of marriage is not similar or intimately related to the issue in the criminal case for parricide. Further, the relationship between the offender and the victim is not determinative of the guilt or innocence of the accused. The issue in the civil case for annulment of marriage under Article 36 of the Family Code is whether petitioner is psychologically incapacitated to comply with the essential marital obligations. The issue in parricide is whether the accused killed the victim. In this case, since petitioner was charged with frustrated parricide, the issue is whether he performed all the acts of execution which would have killed respondent as a consequence but which, nevertheless, did not produce it by reason of causes independent of petitioners will.16 At the time of the commission of the alleged crime, petitioner and respondent were married. The subsequent dissolution of their marriage, in case the petition in Civil Case No. 04-7392 is granted, will have no effect on the alleged crime that was committed at the time of the subsistence of the marriage. In short, even if the marriage between petitioner and respondent is annulled, petitioner could still be held criminally liable since at the time of the commission of the alleged crime, he was still married to respondent.1avvphi1 We cannot accept petitioners reliance on Tenebro v. Court of Appeals 17 that "the judicial declaration of the nullity of a marriage on the ground of psychological incapacity retroacts to the date of the celebration of the marriage insofar as the vinculum between the spouses is concerned x x x." First, the issue in Tenebro is the effect of the judicial declaration of nullity of a second or subsequent marriage on the ground of psychological incapacity on a criminal liability for bigamy. There was no issue of prejudicial question in that case. Second, the Court ruled inTenebro that "[t]here is x x x a recognition written into the law itself that such a marriage, although void ab initio, may still

99

produce legal consequences."18 In fact, the Court declared in that case that "a declaration of the nullity of the second marriage on the ground of psychological incapacity is of absolutely no moment insofar as the States penal laws are concerned."19 In view of the foregoing, the Court upholds the decision of the Court of Appeals. The trial in Criminal Case No. Q-04-130415 may proceed as the resolution of the issue in Civil Case No. 047392 is not determinative of the guilt or innocence of petitioner in the criminal case. WHEREFORE, we DENY the petition. We AFFIRM the 20 March 2006 Decision of the Court of Appeals in CA-G.R. SP No. 91867. SO ORDERED. G.R. Nos. 155531-34 July 29, 2005 MARY ANN RODRIGUEZ, Petitioners, vs. Hon. THELMA A. PONFERRADA, in Her Official Capacity as Presiding Judge of the Regional Trial Court of Quezon City, Branch 104; PEOPLE OF THE PHILIPPINES; and GLADYS NOCOM, Respondents. DECISION PANGANIBAN, J.: Settled is the rule that the single act of issuing a bouncing check may give rise to two distinct criminal offenses: estafa and violation of Batas Pambansa Bilang 22 (BP 22). The Rules of Court allow the offended party to intervene via a private prosecutor in each of these two penal proceedings. However, the recovery of the single civil liability arising from the single act of issuing a bouncing check in __________________ * On official leave. either criminal case bars the recovery of the same civil liability in the other criminal action. While the law allows two simultaneous civil remedies for the offended party, it authorizes recovery in only one. In short, while two crimes arise from a single set of facts, only one civil liability attaches to it. The Case Before us is a Petition for Certiorari 1 under Rule 65 of the Rules of Court, seeking to reverse the

July 27, 2002 Order2 of the Regional Court (RTC) of Quezon City (Branch 104) in Criminal Case Nos. Q-01-106256 to Q-01-106259. Also assailed is the August 16, 2002 Order 3 of the RTC denying petitioners Motion for Reconsideration. The first assailed Order is quoted in full as follows: "For consideration is the opposition of the accused, through counsel, to the formal entry of appearance of private prosecutor. "Accused, through counsel, contends that the private prosecutor is barred from appearing before this Court as his appearance is limited to the civil aspect which must be presented and asserted in B.P. 22 cases pending before the Metropolitan Trial Court of Quezon City. "The private prosecutor submitted comment stating that the offended party did not manifest within fifteen (15) days following the filing of the information that the civil liability arising from the crime has been or would be separately prosecuted and that she should therefore be required to pay the legal fees pursuant to Section 20 of Rule 141 of the Rules of Court, as amended. "Considering that the prosecution under B.P. 22 is without prejudice to any liability for violation of any provision of the Revised Penal Code (BP 22, Sec. 5), the civil action for the recovery of the civil liability arising from the estafa cases pending before this Court is deemed instituted with the criminal action (Rule 111, Sec. 1 [a]). The offended party may thus intervene by counsel in the prosecution of the offense (Rule 110. Sec. 16). "WHEREFORE, the appearance of a private prosecutor shall be allowed upon payment of the legal fees for these estafa cases pending before this Court pursuant to Section 1 of Rule 141 of the Rules of Court, as amended."4 The Facts The undisputed facts are narrated by petitioner as follows: "On 10 December 2001, the Honorable Assistant City Prosecutor Rossana S. MoralesMontojo of Quezon City Prosecutors Office issued her Resolution in I.S. No. 01-15902, the dispositive portion of which reads as follows: Premises considered, there being PROBABLE CAUSE to charge respondent for ESTAFA under Article 315 paragraph 2(d) as amended by PD 818 and for Violation of Batas Pambansa Blg.

100

22, it is respectfully recommended that the attached Information be approved and filed in Court. "As a consequence thereof, separate informations were separately filed against herein [p]etitioner before proper [c]ourts, for Estafa and [v]iolation of Batas Pambansa Blg. 22. "Upon payment of the assessed and required docket fees by the [p]rivate [c]omplainant, the informations for [v]iolation of Batas Pambansa Blg. 22 against herein [p]etitioner were filed and raffled to the Metropolitan Trial Court of Quezon City, Branch 42, docketed as Criminal Cases Nos. 0108033 to 36. "On the other hand, the informations for [e]stafa cases against herein [p]etitioner were likewise filed and raffled to the Regional Trial Court of Quezon City, Branch 104, docketed as Criminal Cases Nos. 01-106256 to 59. "On 17 June 2002, petitioner through counsel filed in open court before the [p]ublic [r]espondent an Opposition to the Formal Entry of Appearance of the Private Prosecutor dated 14 June 2002. "The [p]ublic [r]espondent court during the said hearing noted the Formal Entry of Appearance of Atty. Felix R. Solomon as [p]rivate [p]rosecutor as well as the Opposition filed thereto by herein [p]etitioner. x x x. "As ordered [c]omplainant Comment to [p]etitioner. by the Court, [p]rivate through counsel filed her the Opposition of herein

Noting petitioners opposition to the private prosecutors entry of appearance, the RTC held that the civil action for the recovery of civil liability arising from the offense charged is deemed instituted, unless the offended party (1) waives the civil action, (2) reserves the right to institute it separately, or (3) institutes the civil action prior to the criminal action. Considering that the offended party had paid the corresponding filing fee for the estafa cases prior to the filing of the BP 22 cases with the Metropolitan Trial Court (MeTC), the RTC allowed the private prosecutor to appear and intervene in the proceedings. Hence, this Petition.6 Issues Petitioner raises this sole issue for the Courts consideration: "Whether or not a [p]rivate [p]rosecutor can be allowed to intervene and participate in the proceedings of the above-entitled [e]stafa cases for the purpose of prosecuting the attached civil liability arising from the issuance of the checks involved which is also subject mater of the pending B.P. 22 cases."7 The Courts Ruling The Petition has no merit. Sole Issue: Civil Action in BP 22 Case Not a Bar to Civil Action in Estafa Case Petitioner theorizes that the civil action necessarily arising from the criminal case pending before the MTC for violation of BP 22 precludes the institution of the corresponding civil action in the criminal case for estafa now pending before the RTC. She hinges her theory on the following provisions of Rules 110 and 111 of the Rules of Court: "SECTION 16. Intervention of the offended party in criminal action. -- Where the civil action for recovery of civil liability is instituted in the criminal action pursuant to Rule 111, the offended party may intervene by counsel in the prosecution of the offense." "SECTION 1. Institution of criminal and civil actions. -- (a) When a criminal action is instituted, the civil action for the recovery of civil liability arising from the offense charged

"On 27 June 2002, the [p]ublic [r]espondent court issued the first assailed Order allowing the appearance of the [p]rivate [p]rosecutor in the above-entitled criminal cases upon payment of the legal fees pursuant to Section 1 of Rule 141 of the Rules of Court, as amended. "On 31 July 2002, [a]ccused through counsel filed a Motion for Reconsideration dated 26 July 2002. "On 16 August 2002, the [p]ublic [r]espondent court issued the second assailed Order denying the Motion for Reconsideration of herein [p]etitioner."5 Ruling of the Trial Court

101

shall be deemed instituted with the criminal action unless the offended party waives the civil action, reserves the right to institute it separately or institutes the civil action prior to the criminal action. "The reservation of the right to institute separately the civil action shall be made before the prosecution starts presenting its evidence and under circumstances affording the offended party a reasonable opportunity to make such reservation. "When the offended party seeks to enforce civil liability against the accused by way of moral, nominal, temperate, or exemplary damages without specifying the amount thereof in the complaint or information, the filing fees therefor shall constitute a first lien on the judgment awarding such damages. xxxxxxxxx "(b) The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to include the corresponding civil action. No reservation to file such civil action separately shall be allowed. "Upon filing of the aforesaid joint criminal and civil actions, the offended party shall pay in full the filing fees based on the amount of the check involved, which shall be considered as the actual damages claimed. Where the complaint or information also seeks to recover liquidated, moral, nominal, temperate or exemplary damages, the offended party shall pay the filing fees based on the amounts alleged therein. If the amounts are not so alleged but any of these damages are subsequently awarded by the court, the filing fees based on the amount awarded shall constitute a first lien on the judgment. "Where the civil action has been filed separately and trial thereof has not yet commenced, it may be consolidated with the criminal action upon application with the court trying the latter case. If the application is granted, the trial of both actions shall proceed in accordance with section 2 of this Rule governing consolidation of the civil and criminal actions." Based on the foregoing rules, an offended party may intervene in the prosecution of a crime, except in the following instances: (1) when, from the nature of the crime and the law defining and punishing it, no civil liability arises in favor of a private offended party; and (2) when, from the nature of the offense, the offended parties are entitled to civil indemnity, but (a) they waive the right to institute a civil

action, (b) expressly reserve the right to do so or (c) the suit has already been instituted. In any of these instances, the private complainants interest in the case disappears and criminal prosecution becomes the sole function of the public prosecutor. 8 None of these exceptions apply to the instant case. Hence, the private prosecutor cannot be barred from intervening in the estafa suit. True, each of the overt acts in these instances may give rise to two criminal liabilities -- one for estafa and another for violation of BP 22. But every such act of issuing a bouncing check involves only one civil liability for the offended party, who has sustained only a single injury.9 This is the import of Banal v. Tadeo,10 which we quote in part as follows: "Generally, the basis of civil liability arising from crime is the fundamental postulate of our law that Every man criminally liable is also civilly liable (Art. 100, The Revised Penal Code). Underlying this legal principle is the traditional theory that when a person commits a crime he offends two entities namely (1) the society in which he lives in or the political entity called the State whose law he had violated; and (2) the individual member of that society whose person, right, honor, chastity or property was actually or directly injured or damaged by the same punishable act or omission. However, this rather broad and general provision is among the most complex and controversial topics in criminal procedure. It can be misleading in its implications especially where the same act or omission may be treated as a crime in one instance and as a tort in another or where the law allows a separate civil action to proceed independently of the course of the criminal prosecution with which it is intimately intertwined. Many legal scholars treat as a misconception or fallacy the generally accepted notion that the civil liability actually arises from the crime when, in the ultimate analysis, it does not. While an act or omission is felonious because it is punishable by law, it gives rise to civil liability not so much because it is a crime but because it caused damage to another. Viewing things pragmatically, we can readily see that what gives rise to the civil liability is really the obligation and the moral duty of everyone to repair or make whole the damage caused to another by reason of his own act or omission, done intentionally or negligently, whether or not the same be punishable by law. In other words, criminal liability will give rise to civil liability only if the same felonious act or omission results in damage or injury to another and is the direct and proximate cause thereof. Damage or injury to another is evidently the foundation of the civil action. Such is not the

102

case in criminal actions for, to be criminally liable, it is enough that the act or omission complained of is punishable, regardless of whether or not it also causes material damage to another. (See Sangco, Philippine Law on Torts and Damages, 1978, Revised Edition, pp. 246247)." Thus, the possible single civil liability arising from the act of issuing a bouncing check can be the subject of both civil actions deemed instituted with the estafa case and the BP 22 violation prosecution. In the crimes of both estafa and violation of BP 22, Rule 111 of the Rules of Court expressly allows, even automatically in the present case, the institution of a civil action without need of election by the offended party. As both remedies are simultaneously available to this party, there can be no forum shopping.11 Hence, this Court cannot agree with what petitioner ultimately espouses. At the present stage, no judgment on the civil liability has been rendered in either criminal case. There is as yet no call for the offended party to elect remedies and, after choosing one of them, be considered barred from others available to her. Election of Remedies Petitioner is actually raising the doctrine of election of remedies. "In its broad sense, election of remedies refers to the choice by a party to an action of one of two or more coexisting remedial rights, where several such rights arise out of the same facts, but the term has been generally limited to a choice by a party between inconsistent remedial rights, the assertion of one being necessarily repugnant to, or a repudiation of, the other." 12 In its more restricted and technical sense, the election of remedies is the adoption of one of two or more coexisting ones, with the effect of precluding a resort to the others.13

alternative remedies, both founded upon the identical state of facts, these remedies are not considered inconsistent remedies. In such case, the invocation of one remedy is not an election which will bar the other, unless the suit upon the remedy first invoked shall reach the stage of final adjudication or unless by the invocation of the remedy first sought to be enforced, the plaintiff shall have gained an advantage thereby or caused detriment or change of situation to the other.16 It must be pointed out that ordinarily, election of remedies is not made until the judicial proceedings has gone to judgment on the merits.17 "Consonant with these rulings, this Court, through Justice J.B.L. Reyes, opined that while some American authorities hold that the mere initiation of proceedings constitutes a binding choice of remedies that precludes pursuit of alternative courses, the better rule is that no binding election occurs before a decision on the merits is had or a detriment to the other party supervenes.18 This is because the principle of election of remedies is discordant with the modern procedural concepts embodied in the Code of Civil Procedure which permits a party to seek inconsistent remedies in his claim for relief without being required to elect between them at the pleading stage of the litigation."19 In the present cases before us, the institution of the civil actions with the estafa cases and the inclusion of another set of civil actions with the BP 22 cases are not exactly repugnant or inconsistent with each other. Nothing in the Rules signifies that the necessary inclusion of a civil action in a criminal case for violation of the Bouncing Checks Law20 precludes the institution in an estafa case of the corresponding civil action, even if both offenses relate to the issuance of the same check. The purpose of Section 1(b) of Rule 111 is explained by Justice Florenz D. Regalado (ret.), former chairman of the committee tasked with the revision of the Rules of Criminal Procedure. He clarified that the special rule on BP 22 cases was added, because the dockets of the courts were clogged with such litigations; creditors were using the courts as collectors. While ordinarily no filing fees were charged for actual damages in criminal cases, the rule on the necessary inclusion of a civil action with the payment of filing fees based on the face value of the check involved was laid down to prevent the practice of creditors of using the threat of a criminal prosecution to collect on their credit free of charge.21 Clearly, it was not the intent of the special rule to preclude the prosecution of the civil action

The Court further elucidates in Mellon Bank v. Magsino14 as follows: "As a technical rule of procedure, the purpose of the doctrine of election of remedies is not to prevent recourse to any remedy, but to prevent double redress for a single wrong. 15 It is regarded as an application of the law of estoppel, upon the theory that a party cannot, in the assertion of his right occupy inconsistent positions which form the basis of his respective remedies. However, when a certain state of facts under the law entitles a party to

103

that corresponds to the estafa case, should the latter also be filed. The crimes of estafa and violation of BP 22 are different and distinct from each other. There is no identity of offenses involved, for which legal jeopardy in one case may be invoked in the other. The offenses charged in the informations are perfectly distinct from each other in point of law, however nearly they may be connected in point of fact.22 What Section 1(b) of the Rules of Court prohibits is the reservation to file the corresponding civil action.1wphi1 The criminal action shall be deemed to include the corresponding civil action. "[U]nless a separate civil action has been filed before the institution of the criminal action, no such civil action can be instituted after the criminal action has been filed as the same has been included therein."23 In the instant case, the criminal action for estafa was admittedly filed prior to the criminal case for violation of BP 22, with the corresponding filing fees for the inclusion of the corresponding civil action paid accordingly. 24 Furthermore, the fact that the Rules do not allow the reservation of civil actions in BP 22 cases cannot deprive private complainant of the right to protect her interests in the criminal action for estafa. Nothing in the current law or rules on BP 22 vests the jurisdiction of the corresponding civil case exclusively in the court trying the BP 22 criminal case.25 In promulgating the Rules, this Court did not intend to leave the offended parties without any remedy to protect their interests in estafa cases. Its power to promulgate the Rules of Court is limited in the sense that rules "shall not diminish, increase or modify substantive rights."26 Private complainants intervention in the prosecution of estafa is justified not only for the prosecution of her interests, but also for the speedy and inexpensive administration of justice as mandated by the Constitution. 27 The trial court was, therefore, correct in holding that the private prosecutor may intervene before the RTC in the proceedings for estafa, despite the necessary inclusion of the corresponding civil action in the proceedings for violation of BP 22 pending before the MTC. A recovery by the offended party under one remedy, however, necessarily bars that under the other. Obviously stemming from the fundamental rule against unjust enrichment,28this is in essence the rationale for the proscription in our law against double recovery for the same act or omission.

WHEREFORE, the Petition is DISMISSED and the assailed Order AFFIRMED. Costs against petitioner. SO ORDERED.

104