REGULUS DEVELOPMENT INC. VS.

DE LA CRUZ
781 SCRA 697

FACTS:
The petitioner is the owner of an apartment (San Juan Apartments) located at San Juan Street, Pasay
City. Antonio Dela Cruz (respondent) leased two units (Unit 2002-A and Unit 2002-B) of the San Juan
Apartments in 1993 and 1994. The petitioner sent the respondent a letter to terminate the lease of the
two subject units. Due to the respondent’s refusal to vacate the units, the petitioner filed a complaint
for ejectment before MTC Pasay City. The MTC resolved the case in the petitioner’s favour and ordered
the respondent to vacate the premises, and pay the rentals due until the respondent actually complies.
The respondent appealed to the RTC. Pending appeal, the respondent consigned the monthly rentals to
the RTC due to the petitioner’s refusal to receive the rentals. The RTC affirmed the decision of the MTC
in toto and denied the motion of reconsideration filed by the respondent. The petitioner filed a motion
(to withdraw funds deposited by the defendant-appellant as lessee) praying for the withdrawal of the
rentals consigned by the respondent with the RTC. In an order dated July 25, 2003, the RTC granted the
petitioner’s motion. As a result thereof, RTC issued a writ of execution. Respondent filed a petition of
certiorari under Rule 65 before CA but the CA affirmed RTC’s orders. SC affirmed said resolution.
Petitioner then returned to RTC for an issuance of a writ of execution against the supersedeas bond
representing rentals for the leased property. RTC granted the motion. By virtue of insufficiency thereof,
the petition filed for a motion to levy the respondent’s property which was also granted IN AN ORDER
DATED JUNE 30, 2008. CA affirmed RTC’s decision. Hence this petition.

ISSUE:
The petitioner poses the core issue of whether the RTC has jurisdiction to levy on the respondent’s real
property.

RULING:
The appellate jurisdiction of courts is conferred by law. The appellate court acquires jurisdiction over the
subject matter and parties when an appeal is perfected. On the other hand, equity jurisdiction aims to
provide complete justice in cases where a court of law is unable to adapt its judgements to the special
circumstances of a case because of a resulting legal inflexibility when the law is applied to a given
situation. The purpose of the exercise of equity jurisdiction, among others, is to prevent unjust
enrichment and to ensure restitution. The RTC orders which allowed the withdrawal of the deposited
funds for the use and occupation of the subject units were issued pursuant to the RTC’s equity
jurisdiction, as the CA held in the petition docketed as CA-G.R. SP No. 81277. The RTC’s equity
jurisdiction is separate and distinct from its appellate jurisdiction on the ejectment case. The RTC could
not have issued its orders in the exercise of its appellate jurisdiction since there was nothing more to
execute on the dismissed ejectment case. As the RTC orders explained, the dismissal of the ejectment
case effectively and completely blotted out and cancelled the complaint. Hence, the RTC orders were
clearly issued in the exercise of the RTC’s equity jurisdiction, not on the basis of its appellate jurisdiction.
The RTC, as the court of origin, has jurisdiction to order the levy of the respondent’s real property.
Execution shall be applied for in the court of origin, in accordance with Section 1, Rule 39 of the Rules of
Court. The court of origin with respect to the assailed RTC orders is the court which issued these orders.
The RTC is the court with jurisdiction to order the execution of the issued RTC orders. Hence, the
petitioner correctly moved for the issuance of the writ of execution and levy of the respondent’s real
property before the RTC as the court of origin.

ALDAY VS. FGU INSURANCE

350 SCRA 113

FACTS:
Respondent FGU Insurance Corporation filed a complaint with the RTC of Makati alleging that petitioner
Evangeline K. Alday owed it P114,650.75 representing unliquidated cash advances, unremitted costs of
premiums and other charges incurred by petitioner in the course of her work as an insurance agent for
respondent. Respondent also prayed for exemplary damages, attorneys fees, and costs of suit.
Petitioner filed her answer and by way of counterclaim, asserted her right for the payment of
P104,893.45, representing direct commissions, profit commissions and contingent bonuses earned from
1 Juy 1986 to 7 December 1986, and for accumulated premium reserves amounting to P500,000.00. In
addition, petitioner prayed for attorneys fees, litigation expenses, moral damages and exemplary
damages for the allegedly unfounded action filed by respondent. Respondent filed a Motion to Strike
Out Answer With Compulsory Counterclaim And To Declare Defendant In Default because petitioners
answer was allegedly filed out of time. However, the trial court denied the motion similarly rejected
respondents motion for reconsideration. A few weeks later, respondent filed a motion to dismiss non-
payment of docket fees by petitioner. In response, petitioner asked the trial court to declare her
counterclaim as exempt from payment of docket fees since it is compulsory and that respondent be
declared in default for having failed to answer such counterclaim. The trial court granted respondent’s
motion to dismiss petitioner’s counterclaim and consequently, denied petitioners motion. The court
found petitioners counterclaim to be merely permissive in nature and help that petitioner’s failure to
pay docket fees prevented the court from acquiring jurisdiction over the same. The trial court similarly
denied petitioners motion for reconsideration. The Court of Appeals sustained the trial court, finding
that petitioners own admissions, as contained in her answer, show that her counterclaim is merely
permissive.

ISSUES:
Is the counterclaim of the petitioner permissive or compulsory?; is the counterclaim of the petitioner
exempt from the payment of docket fees and therefore the court acquired jurisdiction over the same?

RULING:
The counterclaim of petitioner is PERMISSIVE. In Valencia v. Court of Appeals, this Court capsulized the
criteria or tests that may be used in determining whether a counterclaim is compulsory or permissive,
summarized as follows: Are the issues of fact and law raised by the claim and counterclaim largely the
same?; would res judicata bar a subsequent suit on defendants claim absent the compulsory
counterclaim rule?; Will substantially the same evidence support or refute plaintiff’s claim as well as
defendants counterclaim?; Is there any logical relation between the claim and the counterclaim?:
Another test, applied in the more recent case of Quintanilla v. Court of Appeals, is the compelling test of
compulsoriness which requires a logical relationship between the claim and counterclaim, that is, where
conducting separate trials of the respective claims of the parties would entail a substantial duplication of
effort and time by the parties and the court. Tested against the abovementioned standards, petitioners
counterclaim for commissions, bonuses, and accumulated premium reserves is merely permissive. The
evidence required to prove petitioners claims differs such as cash advances and cost of premiums. The
recovery of respondent’s claims is not contingent or dependent upon establishing petitioners
counterclaim, such that conducting separate trials will not result in the substantial duplication of the
time and effort of the court and the parties. One would search the records in vain for a logical
connection between the parties’ claims. This conclusion is further reinforced by the petitioners own
admissions since she declared in her answer that respondents cause of action, unlike her own, was not
based upon the Special Agents Contract. However, petitioner’s claims for damages, allegedly suffered as
a result of the filing by respondent of its complaint, are compulsory. NO. The counterclaim being
permissive, in order for the trial court to acquire jurisdiction over the same, petitioner is bound to pay
the prescribed docket fees. It is not simply the filing of the complaint or appropriate initiatory pleading,
but the payment of the prescribed docket fee that vests a trial court with jurisdiction over the subject-
matter or nature of the action. Where the filing of the initiatory pleading is not accompanied by
payment of the docket fee, the court may allow payment of the fee within a reasonable time but in no
case beyond the applicable prescriptive or reglementary period. The same rule applies to permissive
counterclaims, third-party claims and similar pleadings, which shall not be considered filed until and
unless the filing fee prescribed therefor is paid. The court may allow payment of said fee within a
reasonable time but also in no case beyond its applicable prescriptive or reglementary period.
Meanwhile, the compulsory counterclaim of petitioner for damages based on the filing by respondent of
an allegedly unfounded and malicious suit need not be answered since it is inseparable from the claims
of respondent. If respondent were to answer the compulsory counterclaim of petitioner, it would
merely result in the former pleading the same FACTS raised in its complaint.

KOREA TECHNOLOGIES CO., LTD. VS. HON. ALBERT A. LERMAm ET AL.,

G.R. NO. 143581. JANUARY 7, 2008

FACTS:
Petitioner KOGIES and respondent PGSMC executed a contract whereby KOGIES would set up an LPG
Cylinder Manufacturing Plant for respondent. Respondent unilaterally cancelled the contract on the
ground that petitioner had altered the quantity and lowered the quality of the machineries and
equipment it delivered. Petitioner opposed informing the latter that PGSMC could not unilaterally
rescind their contract nor dismantle and transfer the machineries and equipment on mere imagined
violations by petitioner. Petitioner then filed a Complaint for Specific Performance against respondent
before the RTC. Respondent filed its Answer with Compulsory Counterclaim asserting that it had the full
right to dismantle and transfer the machineries and equipment because it had paid for them in full as
stipulated in the contract. KOGIES filed a motion to dismiss respondent’s counterclaims arguing that
when PGSMC filed the counterclaims, it should have paid docket fees and filed a certificate of non-
forum shopping, and that its failure to do so was a fatal defect. The RTC dismissed the petitioner’s
motion to dismiss respondent’s counterclaims as these counterclaims fell within the requisites of
compulsory counterclaims.

ISSUE/S:
WON payment of docket fees and certificates of non-forum shopping were required in the respondent;s
Answer with counterclaim?

RULING:
NO. The counterclaims of PGSMC were incorporated in its Answer with Compulsory Counterclaim in
accordance with Section 8 of Rule 11, 1997 Revised Rules of Civil Procedure, the rule that was effective
at the time the Answer with Counterclaim was filed. Sec 8 on existing counterclaim or cross-claim states,
“A compulsory counterclaim or a cross-claim that a defending party has at the time he files his answer
shall be contained therein.” As to the failure to submit a certificate of forum shopping, PGSMC’s Answer
is not an initiatory pleading which requires a certification against forum shopping under Sec. 524 of Rule
7, 1997 Revised Rules if Civil Procedure. It is a responsive pleading, hence, the courts a quo did not
commit reversible error in denying KOGIES’ motion to dismiss PGSMC’s compulsory counterclaims. At
the time PGSMC filed its Answer incorporating its counterclaims against KOGIES, it was not liable to pay
filing fees for said counterclaims being compulsory in nature. We stress, however, that effective August
16, 2004 under Sec. 7, Rule 141, as amended by A.M. No. 04-2-04-SC, docket fees are now required to
be paid in compulsory counterclaim or cross-claims.

MERCADO VS. CA
569 SCRA

FACTS:
Leonides Mercado had been distributing respondent San Miguel Corporation’s (SMC’s) beer products in
Manila. SMC extended to him a P7.5 million credit line allowing him to withdraw goods on credit.
Mercado failed to pay for the items he withdrew on credit. Citing the continuing hold-out agreement
(which allows SMC to encash China Banking Corporation (CBC) certificates of deposit assigned by
Mercado), it asked CBC to release the proceeds to the assigned certificates of deposit. Mercado filed an
action to annul the continuing hold-out agreement and deed of assignment in the Regional Trial Court
(RTC) of Manila. SMC filed its answer with counterclaim against Mercado. SMC sought payment of the
lees products he withdrew (or purchased on credit) worth P7,468,153.75. During trial, Mercado
acknowledged the accuracy of SMC’s computation of his outstanding liability. Thus, the RTC dismissed
the complaint and ordered Mercado and Eastern Assurance and Surety Corporation (EASCO) (to the
extent of P2.6 million or the value of its bonds) to jointly and severally pay SMC the amount of
P7,468,153.75. The CA affirmed the RTC decision in toto. Mercado passed away and was substituted by
his heirs who filed the petition asserting that the CA erred in affirming the RTC decision in toto. The said
decision (insofar as it ordered Mercado to pay SMC P7,468,153.75) was void. SMC’s counterclaim was
permissive in nature. Inasmuch as SMC did not pay docket fees, the RTC never acquired jurisdiction over
the counterclaim.

ISSUE/S:
Whether SMC’s counterclaim was permissive in nature, whereby payment of docket fees is necessary for
the RTC to acquire jurisdiction.

RULING:
No. A counterclaim (or a claim which a defending party may have against any party) may be compulsory
or permissive. A counterclaim that (1) arises out of (or is necessarily connected with) the transaction or
occurrence that is the subject matter of the opposing party’s claim; (2) falls within the jurisdiction of the
court and (3) does not require for its adjudication the presence of third parties over whom the court
cannot acquire jurisdiction, is compulsory. Otherwise, a counterclaim is merely permissive. When
Mercado sought to annut the continuing hold-out agreement and deed of assignment (which he
executed as security for his credit purchases), he in effect sought to be freed from them. While he
admitted having outstanding obligations, he nevertheless asserted that those were not covered by the
assailed accessory contracts. For its part, aside from invoking the validity of the said agreements, SMC
therefore sought to collect the payment for the value of goods Mercado purchased on credit. Thus,
Mercado’s complaint and SMC’s counterclaim both touched the issues of whether the continuing hold-
out agreement and deed of assignment were valid and whether Mercado has outstanding liabilities to
SMC. The same evidence would essentially support or refute Mercado’s claim and SMC’s counterclaim.
Based on the foregoing, had these issues been tried separately, the efforts of the RTC and the parties
had to be duplicated. Clearly, SMC’s counterclaim being logically related to Mercado’s claim, was
compulsory in nature. Consequently, the payment of docket fees was not necessary for the RTC to
acquire jurisdiction over the subject matter.

PROTON PILIPINAS V BANQUE NATIONALE DE PARIS

460 SCRA

FACTS:
Proton availed of the credit facilities of BNP and executed a corporate guarantee of the extent of US$2
million to guarantee its obligation. Under their trust agreement, Proton would receive imported motor
vehicles and hold them in trust for BNP, to be applied to its obligations to it in case the vehicles are not
sold, Proton would return them to BNP with the documents of title. Proton failed to deliver the
proceeds and to return the unsold motor vehicles. Proton’s guarantors refused to pay its obligation so
BNP filed a complaint ordering them to pay the initial amount of US$2 million with accrued interest and
other related charges. RTC Makati Clerk of Court assessed the docked fees at P352,000. The petitioners
filed a motion to dismiss the complaint by BNP for failure to pay the correct docket fees this preventing
the RTC from acquiring jurisdiction over the case. In addition, the petitioners allege the prematurity of
the complaint since BNP did not previously send a demand letter. The RTC denied the motion to dismiss
the subsequent MR. The CA denied the appeal by way of certiorari stating that Section 7(a), Rule 141 of
the Rules of Court excludes interest accruing from the principal amount being claimed in the pleading in
the computation of the prescribed filing fees. CA denied their MR. The petitioners argue that pursuant
to Administrative Circular 11-94, interests claimed should be included in the computation of the docket
fees. This since BNP underpaid, RTC never acquired jurisdiction over the case.

ISSUES:
(1) Should the computation for payment of docket fees have included the interest claimed by the
complainant? (2) Did the trial court fail to acquire jurisdiction over the case for insufficient docket fees?

RULING:
(1) Yes. The clerk of court should this have assessed the filing fee by taking into consideration “the total
sum claimed, inclusive of interest, damages of whatever kind, attorney’s fees, litigation expenses, and
costs, or the stated value of the property in litigation. In fine, the docket fees paid by respondent were
insufficient. (2) No. When the complaint was filed in 1998, Rule 141 had been amended by
Administrative Circular 11-94 In Manchester Development Corp. vs. CA, this Court help that the court
acquires jurisdiction over any case only upon payment of the prescribed docket fees. However, that the
ruling in Manchester was clarified in Sun Insurance Office, Ltd vs. Asuncion when this Court held that in
the former there was an effort to defraud the government in avoiding to pay the correct docket fees,
whereas in the latter the plaintiff demonstrated his willingness to abide by paying the additional fees as
required. The ruling in Sun Insurance Office was echoed in the 2005 case of Heirs of Bertuldo Hinog v.
Hon. Achilles Melicor. Plainly, while the payment of the prescribed docket fee is jurisdictional
requirement, even its non-payment at the time of filing does not automatically cause the dismissal of
the case, as long as the fee is paid within the applicable prescriptive or reglementary period, more so
when the party involved demonstrates a willingness to abide by the rules prescribing such payment.
Thus, when insufficient filing fees were initially paid by the plaintiffs and there was no intention to
defraud the government, the Manchester rule does not apply. Respondent merely relied on the
assessment made by the Clerk of Court which turned out to be incorrect. Respondent prayed for
“accrued interest subsequent to August 15,1998 until finally fully paid.” The complaint having been filed
on September 7, 1998, respondent’s claim includes the interest from August 16, 1998 until such date of
filing. Respondent did not, however, pay the filing fee corresponding to its claim for interest from
August 16, 1998 until the filing of the complaint on September 7, 1998. As previously discussed, this is
required under Rule 141, as amended by Administrative Circular 11-94, which was the rule applicable at
the time. Thus, as the complaint currently stands, respondent cannot claim the interest from August 16,
1998 until September 7, 1998 unless respondent is allowed by motion to amend its complaint within a
reasonable time and specify the precise amount of interest petitioners owe from August 16, 1998 to
September 7, 1998 and pay the corresponding docket fee.

RUBY SHELTER BUILDERS vs. HON. PABLO C. FORMARAN III

G.R. No. 175914 February 10, 2009

FACTS:
Ruby Shelter Builders filed a complaint with the RTC against Tan. It paid the sum of P13,644.25 for
docket and other legal fees, as assessed by the Office of the Clerk of Court. The Clerk of Court initially
considered the case as an action incapable of pecuniary estimation and computed the docket and other
legal fees due thereon according to Section 7(b)(1), Rule 141 of the Rules of Court. Tan filed an Omnibus
Motion contending that the case involved real properties, the docket fees for which should be
computed in accordance with Section 7(a), not Section 7(b)(1), of Rule 141 of the Rules of Court, as
amended. Thus, since petitioner did not pay the appropriate docket fees, the RTC did not acquire
jurisdiction over the said case. Hence, respondent Tan asked the RTC to issue an order requiring
petitioner to pay the correct and accurate docket fees pursuant to Section 7(a), Rule 141.

ISSUE:
Whether or not the RTC acquired jurisdiction over the case.

RULING:
No. In Manchester Development Corporation v. Court of Appeals, the Court explicitly pronounced that
“The court acquires jurisdiction over any case only upon the payment of the prescribed docket fee.”
Hence, the payment of docket fees is not only mandatory, but also jurisdictional. In Sun Insurance
Office, Ltd. (SIOL) v. Asuncion, the Court laid down guidelines for the implementation of its previous
pronouncements in Manchester under particular circumstances, to wit: (1) It is not simply the filing of
the complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee, that
vests a trial court with jurisdiction over the subject matter or nature of the action. Where the filing of
the initiatory pleading is not accompanied by payment of the docket fee, the court may allow payment
of the fee within a reasonable time but in no case beyond the applicable prescriptive or reglementary
period. (2) The same rule applies to permissive counterclaims, third-party claims and similar pleadings,
which shall not be considered filed until and unless the filing fee prescribed therefor is paid. The court
may also allow payment of said fee within a reasonable time but also in no case beyond its applicable
prescriptive or reglementary period. (3) Where the trial court acquires jurisdiction over a claim by the
filing of the appropriate pleading and payment of the prescribed filing fee but, subsequently, the
judgement awards a claim not specified in the pleading, or if specified the same has been left for
determination by the court, the additional filing fee therefor shall constitute a lien on the judgment. It
shall be the responsibility of the Clerk of Court or his duty authorized deputy to enforce said lien and
assess and collect the additional fee:. In the Petition at bar, petitioner did not pay the correct amount of
docket fees. Petitioner should pay docket fees in accordance with Section 7(a), Rule 141 of the Rules of
Court as amended Consistent with the liberal tenor of Sun Insurance, the RTC, instead of dismissing
outright petitioner’s Complaint, granted petitioner time to pay the additional docket fees. Despite the
seeming munificence of the RTC, petitioner refused to pay the additional docket fees assessed against it,
believing that it had already paid the correct amount before, pursuant to Section 7(b)(1), Rule 141. The
docket fees under Section 7(a), Rule 141, in cases involving real property depend on the fair market
value of the same: the higher the value of the real property, the higher the docket fees due. In contrast,
Section 7(b)(1), Rule 141 imposes a fixed or flat rate of docket fees on actions incapable of pecuniary
estimation. In order to resolve the issue whether petitioner paid the correct amount on docket fees, it is
necessary to determine the true nature of its Complaint. The dictum adhered to in this jurisdiction is
that the nature of an action is determined by the allegations in the body of the pleading or Complaint
itself, rather than by its title or heading. Petitioner persistently avers that its Complaint is primarily for
the annulment of the Deeds of Absolute Sale. Based on the allegations and reliefs in the Complaint
alone, one would get the impression that the titles to the subject real properties still rest with
petitioner; and that the interest of respondents Tan and Obiedo in the same lies only in the Deeds of
Absolute Sale sought to be annulled. What petitioner failed to mention in its Complaint was that
respondents Tan and Obiedo already had the Memorandum of Agreement, which clearly provided for
the execution of the Deeds of Absolute Sale, registered on the TCTs over the five parcels of land, then
still in the name of the petitioner. Petitioner never expressed surprise when such FACTS and
circumstances were established before the RTC, nor moved to amend its Complaint accordingly. Even
though the Memorandum of Agreement was supposed to have long been registered on its TCTs over the
five parcels of land, petitioner did not pray for the removal of the same as a cloud on its title. In the
same vein, although petitioner alleged that respondents Tan and Obiedo forcibly took physical
possession of the subject real properties, petitioner did not seek the restoration of such possession to
itself. And despite learning that respondents Tan and Obiedo already secured TCTs over the subject
properties in their names, petitioner did not ask for the cancellation of said titles. The only logical and
reasonable explanation is that petitioner is reluctant to bring to the attention of the Court certain FACTS
and circumstances keeping its Complaint safely worded, so as to institute only an action for annulment
of Deeds of Absolute Sale. Petitioner deliberately avoided raising issues on the title and possession of
the real properties that may lead the Court to classify its case as a real action. No matter how
fastidiously petitioner attempts to conceal them, the allegations and reliefs it sought in its Complaint
appears to be ultimately a real action, involving as they do the recovery by petitioner of its title to and
possession of the five parcels of land from respondents Tan and Obiedo. A real action is one in which the
plaintiff seeks the recovery of real property; or, as indicated in what is now Section 1, Rule 4 of the Rules
of Court, a real action is an action affecting title to or recovery of possession of real property. Section 7,
Rule 141 of the Rules of Court, prior to its amendment by A.M. No. 04-2-04-SC, had a specific paragraph
governing the assessment of the docket fees for real action, to wit: In a real action, the assessed value of
the property, or if there is none, the estimated value thereof shall be alleged by the claimant and shall
be the basis in computing the fees. While it is true that the petitioner does not directly seek the
recovery of title or possession of the property in question, his action for annulment of sale and his claim
for damages are closely intertwined with the issue of ownership of the building which, under the law, is
considered immovable property, the recovery of which is petitioner’s primary objective. The prevalent
doctrine is that an action for the annulment or rescission of a sale of real property does not operate to
efface the fundamental and prime objective and nature of the case, which is to recover said real
property. it is a real action. A real action indisputably involves real property. The docket fees for a real
action would still be determined in accordance with the value of the real property involved therein; the
only difference is in what constitutes the acceptable value. In computing the docket fees for cases
involving real properties, the courts, instead of relying on the assessed or estimated value, would now
be using the fair market value of the real properties (as stated in the Tax Declaration of the Zonal
Valuation of the Bureau of Internal Revenue, whichever is higher) or, in the absence thereof, the stated
value of the same.

WHEREFORE, premises considered, the instant Petition for Review is hereby DENIED. The Decision,
dated 22 November 2006 of the Court of Appeals in CA-G.R. SP No. 94800, which affirmed the Orders
dated 24 March 2006 and 29 March 2006 of the RTC, Branch 22, of Naga City, in Civil Case No. RTC-2006-
0030, ordering petitioner Ruby Shelter Builders and Realty Development Corporation to pay additional
docketing fees computed based on Section 7(a), Rule 141 of the Rules of Court, as amended, is hereby
AFFIRMED. Costs against petitioner.

ST. LOUIS UNIVERSITY INC. VS. EVANGELINE COBARRUBIAS

626 SCRA 649

FACTS:
Cobarrubias is an associate professor of the petitioner and an active member of the union of faculty and
employees. The Collective Bargaining Agreements contained the following provisions that for teaching
employees in college who fail the yearly evaluation, who are retained for three cumulative years in five
years, shall be in forced leave for one regular semester during which period all benefits due them shall
be suspended. Petitioner placed Cobarrubias on forced leave for failing to achieve the required rating
points (85, 77, and 72.9, below the required rating of 87). To reverse the imposed forced leave.
Cobarrubias sought recourse from the CBA’s grievance machinery but the parties failed to settle their
dispute. Cobarrubias filed a case for illegal forced leave or illegal suspension with DOLE but circulation
and mediation again failed. Cobarrubias argued that the CA already resolved the forced leave issue in a
prior case between the parties, CA-G.R. SP No. 90596,8 ruling that the forced leave for teachers who fail
in their evaluations for three (3) times within a five-year period should be coterminous with the CBA in
force during the same five-year period. On the other hand, Petitioner argue that said CA decision is not
yet final for there is still a pending appeal. The Voluntary Arbitrator dismissed the complaint, then
Cobarrubias filed with the CA a petition for review under Rule 43 of the Rules of Court, but failed to pay
the required filing fees and to attach to the petition copies of the material portions of the record. The
CA responded by dismissing the petition for procedural lapses. Nevertheless, Cobarrubias filed a motion
for reconsideration and attached copies of the material portions of the record and the postal money
orders. She maintained that the ends of justice and fair play are better served if the case is decided on
its metis. The CA reinstated the petition.
ISSUE:
Whether the CA is correct in reinstating the petition despite the failure of Cobarrubias to pay the appeal
docket fees on time.

HELD:
Appeal is not a natural right but a mere statutory privilege, this, appeal must be made strictly in
accordance with the provision set by the law.25 Rule 43 of the Rules of Court provides that appeals from
the judgment of the VA shall be taken into the CA, by filing a petition for review within fifteen days from
the receipt if the notice of judgment. Upon the filing of the petition the petitioner shall pay to the CA
clerk of court the docketing and other lawful fees, non-compliance with the procedural requirements
shall be a sufficient ground for the petition’s dismissal. Thus, payment in full of docket fees within the
prescribed period is not only mandatory, but also jurisdictional. It is an essential requirement, without
which, the decision appealed from would become final and executory as if no appeal has been filed.
Procedural rules are not to be belittled or dismissed simply because their non-observance may have
prejudiced a party’s substantive right, like all rules, they are required to be followed. However, there are
recognized exceptions to their strict observance, such as: (1) Most Persuasive and weighty reasons; (2)
To relieve a litigant from an injustice not commensurate with his failure to comply with the prescribe
procedure; (3) Good faith of the defaulting party by immediately paying within a reasonable time from
the time of the default; (4) The existence of special or compelling circumstances; (5) The merits of the
case; (6) A cause not entirely attributable to the fault or negligence of the party favoured by the
suspension of the rules; (7) A lack of any showing that the review sought is merely frivolous and dilatory;
(8) The other party will not be unjustly prejudiced thereby; (9) Fraud, accident, mistake or excusable
negligence without the appellant’s fault; (10) Peculiar, legal and equitable circumstances attendant to
each cash; (11) In the name of substantial justice and fair play; (12) Importance of the issues involved
and; (13) Exercise of sound discretion by the judge guided by all the attendant circumstances. Thus,
there should be an effort, in the part of the party invoking liberality, to advance a reasonable or
meritorious explanation for his/her failure to comply with the rules, in this case, no explanation has
been given.

GIPA VS. SOUTHERN LUZON INSTITUTE

G.R. NO. 177425

FACTS:
On February 25, 1996 respondent Southern Luzon Institute (SLI) filed a complaint for recovery of
ownership and possession with damages against petitioners GIPA and others defendants including a
certain Rosita Montalban (Rosita). During trial, defendant Rosita executed a Special Power of Attorney in
favor of her sister Daisy M. Placer (Placer) authorizing the latter to represent her in the case and to sign
any and all papers in relation thereto. SLI alleged that it is the absolute owner of a parcel of land
situated in Bulan, Sorsogon. However, petitioners and co-defendats who had been informally occupying
portion of the said property refused to vacate premises despite demand. Petitioners and co-defendants
asserted that they did not heed SLI’s demand to vacate as they believe that they have the right to stay
on the said property relying on the fact that they and their predecessors in interest occupied the
property since the 1950s. The RTC ruled in favor of SLI having proven its ownership of the property by
preponderance of evidence. The said court gave weight to the Miscellaneous Sales Application over the
property which became the basis of the issuance of title under its name and testimony of the draftsman
of the National Housing Authority. It rejected the claim of petitioners and co-defendants which only
relied on documentary evidence consisting mostly of tax declarations and other documents which are
self-serving and could not be conclusive evidence of ownership. Petitioners and co-defendants filed a
notice of appeal before the CA. The CA dismissed the appeal in its resolution since it was not shown that
appellate court docket fees and other lawful fees were paid. Petitioners and co-defendants promptly
filed a motion for reconsideration to which they attached a certification from the RTC that they paid the
appeal fee in the amount of P3000. The CA granted the motion and reinstated the appeal. Subsequently,
the CA through a resolution further required petitioners and co-defendants to remit within ten days
from notice the amount of P30 for legal research fund which was apparently not included in the P3000
appeal fee previously paid by them. Despite the lapse of nine (9) months from their counsel’s receipt of
said resolution, petitioners failed to comply. Hence, the CA dismissed the appeal for non-payment of the
docket and other lawful fees within the regementary period as provided under Section 4 of Rule 41 of
the Rules of Court.

ISSUE/S:
(1) Whether or not Placer should be included as petitioner; (2) Whether or not the CA gravely erred in
dismissing the appeal for the failure of petitioners to remit the P30 for legal research fund after having
advanced a substantial portion of docket fees.

RULING:
(1) The court in accordance with the disquisition made in this decision impleaded Placer but did not
consider her as petitioner. “The caption of the present Petition includes Placer as one of the petitioners.
In fact, the other petitioners even authorized her to sign the verification and certification of non-forum
shopping in their behalf. A review of the records, however, shows that she was not one of the
defendants before the RTC. Her only participation therein was that she represented her sister Rosita as
one of the defendants by virtue if a Special Power of Attorney which the latter executed in her favor.
Notably in the present Petition, Placer appears to have been impleaded in her personal capacity and not
as Rosita’s representative. This cannot be done. It bears emphasizing that an appeal on certiorari, as in
this case, is a continuation of the original suit. Hence, the parties in the original suit must also be the
parties in such an appeal. Placer, therefore, not being a party in the complaint before the RTC has no
personality to continue the same in appeal and cannot be considered as a petitioner. At the most, her
only role in this Petition was to sign the verification and certification of non-forum shopping for and in
behalf of petitioners; (2) The petition fails. Petitioners concede to the fact that payment of the full
amount of docket fees within the prescribed period is not a mere technicality of law or procedure but a
jurisdictional requirement. Nevertheless, they are praying for the relaxation of the application of the
rule on the payment of the appeal fee in the name of substantial justice and equity. The Court held that
“concomitant to the liberal interpretation of the rules of procedure should be an effort on the part of
the party invoking liberality to adequately explain his failure to abide by the rules.” Those who seek
exemption from the application of the rule have the burden of proving the existence of exceptionally
meritorious reason warranting such departure. Petitioners’ failure to advance any explanation as to why
they failed to pay the correct docket fees or to complete payment of the same within the period allowed
by the CA is this fata to their cause. Hence, a departure from the rule of the payment of the appeal fee is
unwarranted.

REYES VS PEOPLE
763 SCRA 226

FACTS:
Petitioner, in a complaint filed by private respondent Salud M. Gegato, was charged with Grave Threats
before MCTC Bayugan, Agusan Del Sur. Before arraignment, petitioner filed a Motion to Quash based on
the ground of jurisdiction and that the crime is not Grave Threats under Article 282 of the Revised Penal
Code, but Other Light Threats under Article 285, paragraph 2 of the same code. MCTC found the
petitioner guilty beyond reasonable doubt of Light Threats. Thus, petitioner filed with the Court of
Appeals a Motion for Extension of Time to File a Petition for Review. However, instead of filing a Petition
for Review within the 15-day period allowed by the CA, petitioner filed a second Motion for Extension of
Time asking for another 15 days within which to file his petition for review. Afterwhich, petitioner filed
his petition. Thereafter, the CA, in its Resolution dated August 2, 2007, dismissed the petition. The
petitioner filed three Motions for Reconsiderations before the CA, all of which were denied. Hence, the
present petition.

ISSUE:
(1) Whether or not the right of the petitioner to file an appeal under Rule 45 may be barred by filing
three motions for reconsideration; (2) Whether or not the right to appeal may be batted by failure to
pay correct docket fees on time.

RULING:
YES. (1) At the outset, the Court emphasized that second and subsequent motions for reconsideration
are, as a general rule, prohibited. Section 2, Rule 52 of the Rules of Court provides that “no second
motion for reconsideration of a judgment or final resolution by the same party shall be entertained.”
The rule rests on the basic tenet of immutability if judgments. “At some point, a decision becomes final
and executory and, consequently, all litigations must come to an end.” The general rule, however,
against second and subsequent motions for reconsideration admits of settled exceptions. In Neypes vs.
Court of Appeals, The Court declared: In setting aside technical infirmities and thereby giving course to
tardy appeals, we have not been oblivious or unmindful of the extraordinary situations that merit liberal
application of the Rules. In those situations where technicalities were dispensed with, our decisions
were not meant to undermine the force and effectivity of the periods set by the law. But we hasted to
add that in those rare cases where procedural rules were not stringently applied, there always existed a
clear need to prevent the commission of a grave injustice. Our judicial system and the courts have
always tried to maintain a healthy balance between the strict enforcement of procedural laws and the
guarantee that every litigant be given the full opportunity for the just and proper disposition of his
cause. The circumstance surrounding this case do not warrant the relaxation of the rules. Petitioner
failed to present compelling justification or reason to relax the rules of procedure. The CA ruled that,
“The petitioner’s attribution to inadvertence (as the cause) of his failure to indicate a complete
statement of material dates and to attach pertinent document material to the petition is not compelling
or reasonable enough for the Court to disregard the mandate in Rule 42, Sec 3 of the Rules.; (2) YES. The
rule is that payment in full of the docket fees within the prescribed period is mandatory. In Manchester
v Court of Appeals, it was held that a court acquires jurisdiction over any case only upon the payment of
the prescribed docket fee. The strict application of this rule was, however, relaxed two (2) years after in
the case of Sun Insurance Office. Ltd. V. Asuncion, wherein the Court decreed that where the initiatory
pleading is not accompanied by the payment of the docket fee, the court may allow payment of the fee
within a reasonable period of time, but in no case beyond the applicable prescriptive or reglementary
period. This ruling was made on the premise that the plaintiff had demonstrated his willingness to abide
by the rules of paying the additional docket fees required. Thus, in the more recent case of United
Overseas Bank v. Ros, the Court explained that where the party does not deliberately intend to defraud
the court in payment of docket fees, and manifests its willingness to abide by the rules by paying
additional docket fees when required by the court, the liberal doctrine enunciated in Sun Insurance
Office, Ltd. and not the strict regulations set in Manchester, will apply. Admittedly, this rule is not
without recognize qualifications. The court has declared that in appealed cases, failure to pay the
appellate court docket fee within the prescribed period warrants only discretionary as opposed to
automatic dismissal of the appeal and that the court shall exercise its power to dismiss in accordance
with the tenets of justice and fair play, and with great deal of circumspection considering all attendant
circumstances. In that connection, the CA, in its discretion may grant an additional period of fifteen (15)
days only within which to file the petition for review upon proper motion and the payment of the full
amount of the docket and other lawful fees and the deposit for costs before the expiration of the
reglementary period and that no further extension shall be granted except for the most compelling
reason and in no case to exceed fifteen (15) days. Petitioner now begins this Court for leniency in the
interest of justice. While there is a crying need to unclog court dockets, on one hand, there is, on the
other, a greater demand for resolving genuine disputes fairly and equitably, for it is far better to dispose
of a case on the merit which is a primordial end, rather than on a technicality that may result in
injustice. However, it is only when persuasive reasons exist that the Rules may be relaxed to spare a
litigant of an injustice not commensurate with his failure to comply with the prescribed procedure. In
the present case, petitioner failed to convince this Court of the need to relax the rules and the eventual
injustice that he will suffer if his prayer is not granted.

DYNAMIC BUILDERS VS PRISBITERO

755 SCRA 90

FACTS:
On December 28, 2005, the Municipality of Valladolid, Negros Occidental, through its Bids and Awards,
published an invitation to bid for the construction of a 1,050 lineal meter rubble concrete seawall along
the municipality’s shoreline. It is known as the Construction Shoreline Protection Project. On January 17,
2006, the Bids and Awards Committee conducted a pre-bid conference attended by six (6) prospective
contractors including Dynamic Builders. Three (3) out of seven (7) contractors that had secured bidding
documents in order to bid “submitted letters of withdrawal.” Thus, only the remaining four (4) bidders
were considered during the opening of the bids. On April 21, 2006, the Bids and Awards Committee
issued Resolution No. 7 affirming the award of contract to HLJ Construction and Enterprise for the
construction of the 1,050-lineal-meter Construction Shoreline Protection Project amounting to
P31,922,420.37. On September 4, 2006 and pursuant to Article XVII, Section 58 of Republic Act No.
9184, otherwise known as the Government Procurement Reform Act, Dynamic Builders filed the Petition
for Certiorari before the Regional Trial Court of Bago City, Negros Occidental, assailing Mayor
Presbitero’s Decision and Resolution. Simultaneously, Dynamic Builders filed a dated September 4, 2006
for prohibition with application for temporary restraining order and/or writ of preliminary injunction
before the Supreme Court. Petitioner Dynamic Builders submits that Article XVII, Section 58 if Republic
Act No. 9184 implicitly allowed it to simultaneously file a petition for Certiorari before the Regional Trial
Court assailing the protest case on the merits, and another Petition before this court for injunctive
remedies.

ISSUE:
Whether or not the petitioner has violated the rules on forum shopping by instituting two suits before
the RTC and SC

RULING:
Rule 2, Section 3 of the Rules of Court provide that “A party may not institute more than one suit for a
single cause of action.” Moreover, Section 4 discusses the splitting of a single cause of action that “if two
or more suits are instituted on the basis of the same cause of action, the filing of one or a judgment
upon the merits in any one is available as a ground for the dismissal of the others.” The splitting of a
cause of action “violates the policy against multiplicity of suits, whose primary objective is to avoid
unduly burdening of the dockets of the courts.” This petition seeks to enjoin the execution of public
respondent’s Decision and Resolution on the protest – the same Decision and Resolution sought to be
set aside in the Petition before the Regional Trial Court. In essence, Petitioner seeks the same relief
through two separate Petitions filed before separate courts. This violates the rule against forum
shopping. Private respondent alleges that petitioner did not even notify the Regional Trial Court of Bago
City, Negros Occidental, of its Petition filed before this court. The rules of Court provides for original
concurrent jurisdiction by the Regional Trial Court, the Court of Appeals, and this court in entertaining
petitions for certiorari, prohibition, or mandamus. However, parties must adhere to the principle of
hierarchy of courts. The hierarchy of courts must be respected. The doctrine with respect to hierarchy of
courts was designed so that this court will have more time to focus on its constitutional tasks without
the need to deal with causes that also fall within the lower courts’ competence. This court acts on
petitions for extraordinary writs under Rule 65 only when absolutely necessary or when serious and
important reasons exist to justify an exception to the policy. Consistent with these rules and doctrines,
the remedy contemplated by Article XVII, Section 58 of Republic Act No. 9184 is either an action under
Rule 65 before the Regional Trial Court or the proper action filed before this court. However, direct
resort to this court can prosper only when the requisites for direct invocation of this court’s original
jurisdiction are present.