RULE 7

TRAVEO v. BOBONGON
Facts:
Petitioner Oldarico Traveo and his 16 co-petitioners were hired by
respondent Timog Agricultural Corporation (TACOR) and respondent Diamond
Farms, Inc. (DFI) to work at a banana plantation at Bobongon, Santo Tomas,
Davao Del Norte. Petitioners state although they worked under the direct control of
supervisors assigned by TACOR and DFI, these companies used different schemes
to make it appear that petitioners were hired through independent contractors and
that under the last scheme adopted by these companies, the individual contractors
were required to join respondent Bobongon Banana Growers Multipurpose
Cooperative (the Cooperative).
Sometime in 2000, above-named respondents began utilizing harassment
tactics to ease them out of their jobs. Without first seeking the approval of the
DOLE, they changed their compensation package from being based on a daily rate
to a pakyawan rate. One after another, three separate complaints for illegal
dismissal were filed by petitioners, individually and collectively, with the NLRC
against said respondents including respondent Dole Asia Philippines as it then
supposedly owned TACOR for unpaid salaries, overtime pay, 13th month pay,
service incentive leave pay, damages, and attorney's fees.
Thereafter, the Labor Arbiter, found respondent Cooperative guilty of illegal
dismissal but it dropped the complaints against DFI, TACOR and Dole Asia
Philippines. On partial appeal to the NLRC, petitioners questioned the Labor
Arbiter's denial of their money claims and the dropping of their complaints against
TACOR, DFI, and Dole Asia Philippines. The appellate court dismissed petitioners'
petition for certiorari on the ground that the accompanying verification and
certification against forum shopping was defective, it having been signed by only
19 of the 22 therein named petitioners. Petitioners contend that the appellate court
erred in dismissing their petition on a mere technicality as it should have, at most,
dismissed the petition only with respect to the non-signing petitioners.
Issue:
Whether or not the CA erred in dismissing the petition on mere technicalities
Ruling:
NO.
Respecting the appellate courts dismissal of petitioners appeal due to the
failure of some of them to sign the therein accompanying verification and
certification against forum shopping, the Courts guidelines for the bench and bar

in Altres v. Empleo, which were culled from jurisprudential pronouncements, are

instructive: For the guidance of the bench and bar, the Court restates in capsule
form the jurisprudential pronouncements already reflected above respecting non
compliance with the requirements on, or submission of defective, verification
and certification against forum shopping:
1) A distinction must be made between non compliance with the requirement
on or submission of defective verification, and non-compliance with the
requirement on or submission of defective certification against forum shopping.
2) As to verification, non-compliance therewith or a defect therein does not
necessarily render the pleading fatally defective. The court may order its
submission or correction or act on the pleading if the attending circumstances are
such that strict compliance with the Rule may be dispensed with in order that the
ends of justice may be served thereby.
3) Verification is deemed substantially complied with when one who has
ample knowledge to swear to the truth of the allegations in the complaint or
petition signs the verification, and when matters alleged in the petition have
been made in good faith or are true and correct.
4) As to certification against forum shopping, non-compliance therewith or a
defect therein, unlike in verification, is generally not curable by its subsequent
submission or correction thereof, unless there is a need to relax the Rule on the
ground of substantial compliance or presence of special circumstances or
compelling reasons.
5) The certification against forum shopping must be signed by all the
plaintiffs or petitioners in a case; otherwise, those who did not sign will be
dropped as parties to the case. Under reasonable or justifiable circumstances,
however, as when all the plaintiffs or petitioners share a common interest and
invoke a common cause of action or defense, the signature of only one of them in
the certification against forum shopping substantially complies with the Rule.
6) Finally, the certification against forum shopping must be executed by the
party-pleader, not by his counsel. If, however, for reasonable or justifiable reasons,
the party-pleader is unable to sign, he must execute a Special Power of Attorney
designating his counsel of record to sign on his behalf.
Petitioners' contention that the appellate court should have dismissed the
petition only as to the non-signing petitioners or merely dropped them as parties
to the case is thus in order.
RULE10
PHILIPPINEPORTSAUTHORITYv.GOTHONG
Facts:

PetitionerWilliamGothong&Aboitiz,Inc.(WG&Aforbrevity),isaduly
organizeddomesticcorporationengagedintheshippingindustry.Respondent
PhilippinePortsAuthority(PPAforbrevity),upontheotherhand,isagovernment
ownedandcontrolledcompanymandatedunderitschartertooperateand
administerthecountrysseaportandportfacilities.
PetitionerWG&ArequestedrespondentPPAforittobeallowedtolease
andoperateMarineSlipWayintheNorthHarbor.Thereafter,thenPresident
EstradaissuedamemorandumapprovingtherequestofpetitionerWG&Atolease
thesaidfacilityfromJanuary1toJune30,2001oruntilsuchtimethatrespondent
PPAturnsoveritsoperationstothewinningbidderfortheNorthHarbor
ModernizationProject.
However,believingthatthesaidleasealreadyexpiredonJune30,2001,
respondentPPAsubsequentlysentalettertopetitionerWG&Adirectingthelatter
tovacatethecontestedpremises.WG&AwrotePPAaletterurgingthelatterto
reconsideritsdecisiontoejecttheformerbutitwasdeniedwhichprompted
WG&AtocommenceanInjunctionsuit.PetitionerclaimsthatthePPAunjustly,
illegallyandprematurelyterminatedtheleasecontract.Itlikewiseprayedforthe
issuanceofatemporaryrestrainingordertostoptheevacuation.
PetitionerWG&Aamendeditscomplaintbutthesamewasstilldenominated
asoneforInjunctionwithprayerforTROstatingthatPPAisalreadyestopped
fromdenyingthatthecorrectperiodofleaseisuntilsuchtimethattheNorth
HarborModernizationProjecthasbeenbiddedouttoandoperationsturnedoverto
thewinningbidder.TheTROsoughtwasdeniedbytheRTC.
PetitionerlatermovedforthereconsiderationofthesaidOrder.
Subsequently,petitionerfiledaMotiontoAdmitAttachedSecondAmended
ComplaintwhichwasalreadycaptionedasoneforInjunctionwithPrayerfor
TemporaryRestrainingOrderand/orWritofPreliminaryInjunctionanddamages
and/orforReformationofContract.Also,itincludedasitsfourthcauseofaction
andadditionalreliefinitsprayer,thereformationofthecontractasitfailedto
expressorembodythetrueintentofthecontractingparties.
PPAstronglyopposedthesecondamendedcomplaintcontendingthatthe
reformationsoughtforbythepetitionerconstitutedsubstantialamendment,which
ifgranted,willsubstantiallyalterthelatterscauseofactionandtheoryofthecase.
TheRTCdeniedthesaidSecondAmendedComplaintbuttheCAreversedthe
decisiondirectingtheRTCtoadmitrespondentsSecondAmendedComplaint
pursuanttoSection3,Rule10ofthe1997RulesofCivilProcedure
Issue:

WhetherornottherespondentsSecondAmendedComplaintmaybe
admitted
Ruling:
YES.
Inthiscase,theRTCappliedtheoldSection3,Rule10oftheRulesof
Court:
Section3.Amendmentsbyleaveofcourt.afterthecaseissetfor
hearing,substantialamendmentsmaybemadeonlyuponleaveofcourt.Butsuch
leavemayberefusedifitappearstothecourtthatthemotionwasmadewithintent
todelaytheactionorthatthecauseofactionordefenseissubstantiallyaltered.
Ordersofthecourtuponthemattersprovidedinthissectionshallbemadeupon
motionfiledincourt,andafternoticetotheadverseparty,andanopportunitytobe
heardinsteadoftheprovisionsofthe1997RulesofCivilProcedure,
amendingSection3,Rule10,towit:
SECTION3.Amendmentsbyleaveofcourt.Exceptasprovidedin
thenextprecedingsection,substantialamendmentsmaybemadeonlyuponleave
ofcourt.Butsuchleavemayberefusedifitappearstothecourtthatthemotion
wasmadewithintenttodelay.Ordersofthecourtuponthemattersprovidedin
thissectionshallbemadeuponmotionfiledincourt,andafternoticetothe
adverseparty,andanopportunitytobeheard.
TheCourthasemphasizedtheimportofSection3,Rule10ofthe1997
RulesofCivilProcedureinValenzuelav.CourtofAppeals,363SCRA779
(2001),thus:Interestingly,Section3,Rule10ofthe1997RulesofCivil
Procedureamendedtheformerruleinsuchmannerthatthephraseorthat
thecauseofactionordefenseissubstantiallyalteredwasstrickenoffandnot
retainedinthenewrules.TheclearimportofsuchamendmentinSection3,
Rule10isthatunderthenewrules,theamendmentmay(now)substantially
alterthecauseofactionordefense.Thisshouldonlybetrue,however,when
despiteasubstantialchangeoralterationinthecauseofactionordefense,the
amendmentssoughttobemadeshallservethehigherinterestsofsubstantial
justice,andpreventdelayandequallypromotethelaudableobjectiveofthe
ruleswhichistosecureajust,speedyandinexpensivedispositionofevery
actionandproceeding.
SWAGMANHOTELSANDTRAVEL,INC.v.CA
Facts:

PetitionerSwagmanHotelsandTravel,Inc.,obtainedloansfromrespondent
Christianevidencedby3promissorynotes.Subsequently,respondentChristian
filedacomplaintforasumofmoneyanddamagesagainstthepetitioner
corporationstatingthatforawhile,thepetitionerpaidaninterestof15%per
annumeverythreemonthsinaccordancewiththethreepromissorynotesbutlater
onpetitionerpaidhimonlyaninterestof6%perannum,insteadof15%per
annum,inviolationofthetermsofthethreepromissorynotesdespitethefactthat
Christianlateronagreedtowaivetheinterestof15%perannumandaccept
paymentsininstallmentbasis.Ontheotherhand,petitionercorporation,contends
thatrespondenthasnocauseofactionbecausethe3promissorynoteswerenotyet
dueanddemandable.
TheRTCandCAruledinfavorofthepetitionerthatwhentheinstantcase
wasfiled,noneofthepromissorynotesweredueanddemandable.However,the
firstandsecondpromissorynoteshavealreadymaturedduringthependencyofthe
case.Hence,thepaymentisalreadyduebecauseunderSection5ofRule10ofthe
1997RulesofCivilProcedure,acomplaintwhichstatesnocauseofactionmaybe
curedbyevidencepresentedwithoutobjection.Thus,eveniftheplaintiffhadno
causeofactionatthetimehefiledtheinstantcomplaintwhereinthedefendants
obligationisnotyetdueanddemandablethen,hemaystillrecoveronthefirsttwo
promissorynotesinviewoftheintroductionofevidenceduringtrialshowingthat
theobligationscoveredbythetwopromissorynotesarenowdueanddemandable.
Issue:

Whetherornotacomplaintwhichdoesnotstateacauseofactionmaybe
curedbyevidencepresentedwithoutobjectionduringthetrial
Ruling:
NO.
Inthiscase,whenthecompliantforasumofmoneyanddamageswasfiled,
nocauseofactionhasexistedbecausethepetitionerhadnotcommittedanyactin
violationofthetermsofthe3promissorynotes.Withoutacauseofaction,the
respondenthadnorighttomaintainanactionincourtandthetrialcourt
shouldhavedismissedthecomplaint.
ThecuringeffectunderSection5,Rule10isapplicableonlyifacauseof
actioninfactexistsatthetimethecomplaintisfiled,butthecomplaintis
defectiveforfailuretoallegetheessentialfacts.Forexample,ifacomplaint
failedtoallegethefulfillmentofaconditionprecedentuponwhichthecauseof
actiondepends,evidenceshowingthatsuchconditionhadalreadybeenfulfilled

whenthecomplaintwasfiledmaybepresentedduringthetrial,andthecomplaint
maybeamendedthereafter.
Itthusfollowsthatacomplaintwhosecauseofactionhasnotyet
accruedcannotbecuredorremediedbyanamendedorsupplemental
pleadingallegingtheexistenceoraccrualofacauseofactionwhilethecaseis
pending.Suchanactionisprematurelybroughtandis,therefore,a
groundlesssuit,whichshouldbedismissedbythecourtuponpropermotion
seasonablyfiledbythedefendant.Theunderlyingreasonforthisruleisthata
personshouldnotbesummonedbeforethepublictribunalstoanswerfor
complaintswhichareimmature.
Unlesstheplaintiffhasavalidandsubsistingcauseofactionatthetimehis
actioniscommenced,thedefectcannotbecuredorremediedbytheacquisitionor
accrualofonewhiletheactionispending,andasupplementalcomplaintoran
amendmentsettingupsuchafteraccruedcauseofactionisnotpermissible.