Remedial Law Review I - Atty.

Custodio
AY 2019 - 2020 (1st sem) ASUNCION, BONIFACIO, CAPILA, CHUA, CRUZ, GAON, GARCIA, INTIA, LAGO, MARTINEZ, NOMBRES, OBNAMIA, PERNES, REPOSAR, STA. ANA, TABALINGCOS, TEMPORAL
JOINDER OR MISJOINDER
ISSUE: W/N the court can award reimbursement in an unlawful detainer case - NO
1. Teraa vs. Hon. Sagun (GR. No. 152131)
Doctrine: HELD:
An action for reimbursement or for recovery of damages may not be properly joined with the
action for ejectment. D​amages recoverable in an unlawful detainer action are limited to rentals or reasonable
ROC Rule 2 Sec. 5. Joinder of causes of action. - (b) a joinder shall not include special civil compensation for the use of the property. ​(ie. arrears in rent)
actions or actions governed by special rules.
The Court has not jurisdiction to award the reimbursement prayed for by both parties. Both
Facts: parties seek damages other than rentals or reasonable compensation for the use of the property,
1. The respondent Antonio Simuangco (respondent) owned a house and lot at 138 J.P. which are only forms of damages that may be recovered in an unlawful detainer case. Rule 70,
Laurel St., Nasugbu, Batangas, which he leased to the petitioner. Section 17 of the Rules of Court authorizes the trial court to order the award of an amount
2. Sometime in 1996, the petitioner demolished the leased house and erected a new one representing arrears of rent or reasonable compensation for the use and occupation of the
in its... place. The respondent alleged that this was done without his consent. premises if it finds that the allegations of the complaints are true.
3. The petitioner allegedly also gave the materials from the demolished house to her
sister, who built a house adjacent to the respondent's property.
The rationale for limiting the kind of damages recoverable in an unlawful detainer case was
4. When the respondent discovered what the petitioner did, he immediately confronted
explained in Araos v. Court of Appeals, wherein the court held that:
her and advised her to... vacate the premises. She refused.
5. On February 3, 1997, the respondent sent a letter demanding the petitioner to vacate
The rule is settled that in forcible entry or unlawful detainer cases, the only damage that can be
the leased property.
recovered is the fair rental value or the reasonable compensation for the use and occupation of
6. Despite this letter of demand, which the petitioner received on February 10, she still
the leased property. ​The reason for this is that in such cases, the only issue raised in ejectment
refused to vacate the said property.
cases is that of rightful possession​; hence, the damages which could be recovered are those
7. The respondent thus filed a complaint for unlawful detainer... on the ground of the
which the plaintiff could have sustained as a mere possessor, or those caused by the loss of the
petitioner's violation of the terms of the Contract of Lease. ​He prayed, among other
use and occupation of the property, and not the damages which he may have suffered but which
reliefs, to be reimbursed on the value of the demolished house.
have no direct relation to his loss of material possession.
8. Petitioner moved to dismiss the complaint and prayed for the court to: 1) dismiss the
ejectment case against her; and 2) award in her favor: ​a) ₱100,000.00 as moral
damages, b) ₱200,000.00 as reimbursement for the expenses incurred in building the An action for reimbursement or for recovery of damages may not be properly joined with the
new house, c) ₱50,000.00 as attorney’s fees, and d) ₱10,000.00 as costs incurred in action for ejectment. The former is an ordinary civil action requiring a full-blown trial, while an
relation to the suit​. action for unlawful detainer is a special civil action which requires a summary procedure. The
9. Petitioner denied allegations of the complaint joinder of the two actions is specifically enjoined by Section 5 of Rule 2 of the Rules of Court,
10. She claimed that she demolished the old building and built a new one with the which provides:
knowledge and consent of the respondent; that the original house was old and was on
the verge of... collapsing; that without the timely repairs made by the petitioner, the Section 5. Joinder of causes of action. – A party may in one pleading assert, in the alternative or
house's collapse would have caused the death of the petitioner and her family. otherwise, as many causes of action as he may have against an opposing party, subject to the
11. The trial court called for a preliminary conference under Section 7 of the Revised following conditions:
Rules of Summary Procedure (RSP) and Section 8 of Rule 70 of the Rules of Court,
and required the parties to file their position papers and affidavits of their witnesses (a) The party joining the causes of action shall comply with the rules on joinder of parties;
after they failed... to reach an amicable settlement.
12. Instead of filing their position papers, both parties moved for an extension of time to (b) The joinder shall not include special civil actions or actions governed by special rules;
file the necessary pleadings.
13. MTC: denied both motions on the ground that the RSP and the Rules of Court,... (c) Where the causes of action are between the same parties but pertain to different venues or
particularly Rule 70, Section 13(5), prohibit the filing of a motion for extension of time. jurisdictions, the joinder may be allowed in the Regional Trial Court provided one of the causes
14. MTC ordered petitioner-defendant Aida Terana and all persons claiming right under of action falls within the jurisdiction of said court and the venue lies therein; and
her to vacate and surrender possession of the subject house to the plaintiff; Ordering
the said defendant to pay the amount of Five Thousand Pesos (P5,000.00) as (d) Where the claims in all the causes of action are principally for recovery of money, the
Attorney's fees; and To pay the costs of suit. aggregate amount claimed shall be the test of jurisdiction. [Underscoring supplied.]
15. RTC: The RTC rendered judgment affirming the decision of the MTC
16. CA: affirmed the RTC in a decision promulgated on September 7, 2001. FALLO: ​The petitioner FLORAIDA TERANA and all persons claiming right under her are ordered
17. Petitioner is firm on her stance that she will only vacate upon reimbursement of the to vacate and surrender possession of the subject property to the respondent ANTONIO
expenses she incurred in building the new house. SIMUANGCO. No costs.

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Remedial Law Review I - Atty. Custodio
AY 2019 - 2020 (1st sem) ASUNCION, BONIFACIO, CAPILA, CHUA, CRUZ, GAON, GARCIA, INTIA, LAGO, MARTINEZ, NOMBRES, OBNAMIA, PERNES, REPOSAR, STA. ANA, TABALINGCOS, TEMPORAL
2. Roger Navarro vs. Hon. Jose Escobido of RTC CDO Br. 37, and Karen Go (GR. No.
153788)
Facts:
1. Go filed 2 complaints:
a. Civil Case 98-599 (first complaint) and 98-598 (second complaint), before
the RTC for replevin and/or sum of money with damages against Navarro.
b. Go prayed that the RTC issue writs of replevin for the seizure of two (2)
motor vehicles in Navarro's possession.
2. Go alleged that she was doing business under Kargo Enterprises, which was in buying
and selling motor vehicles, including hauling trucks and other heavy equipment.
3. The first complaint: Go leased to Navarro with option to purchase a certain motor
vehicle (Fuso with Mounted Crane) and Navarro delivered 6 post-dated checks
a. That the 5th and 6th checks were dishonored
b. That demands were made but to no avail, so Go sustained injury
c. That Go prays for the motor vehicle’s immediate delivery pending the final
determination of the case.
4. The second complaint: same allegations
a. instead, there were 3 post-dated checks and the 3rd was dishonored.
5. RTC issued writs of replevin. The Sheriff seized the 2 vehicles and delivered them to
the possession of Karen Go.
6. In his Answers, Navarro alleged as a special affirmative defense that the 2 complaints
stated no cause of action, since Karen Go was not a party to the Lease Agreements
with Option to Purchase (collectively, the lease agreements) — the actionable
documents on which the complaints were based. Cases were then consolidated.
a. He alleged that it was Glenn Go that signed the contracts.
b. RTC dismissed the case on the said ground.
7. Go filed a MR. RTC aside the order of dismissal.
a. Acting on the presumption that Glenn Go's leasing business is a conjugal
property, RTC held that Karen Go had sufficient interest in his leasing
business to file the action against Navarro.
8. RTC held that Karen Go should have included her husband, Glenn Go, in the
complaint based on Section 4, Rule 3.
a. RTC ordered Karen Go to file a motion for the inclusion of Glenn Go as
co-plaintiff. RTC denied Navarro's MR.
9. Navarro posits that the RTC erred when it ordered the amendment of the complaint to
include Glenn as a co-plaintiff, instead of dismissing the complaint outright because a
complaint which does not state a cause of action cannot be converted into one with a
cause of action by a mere amendment or a supplemental pleading. RTC created a
cause of action for Karen when there was none at the time she filed the complaints.
Issue: W/N there was non-joinder of indispensable parties - NO.
Held: Petition Denied.
1. The Rules of Court requires that every action must be prosecuted or defended in the
name of the real party-in-interest, i.e., the party who stands to be benefited or injured
by the judgment in the suit, or the party entitled to the avails of the suit.
a. Karen is the real party in interest, doing business under Kargo.
b. Since Glenn Go is not strictly an indispensable party in the action to recover
possession of the leased vehicles, he only needs to be ​impleaded as a
pro-forma party to the suit.
2. Even assuming that Glenn Go is an indispensable party, misjoinder or non-joinder of
indispensable parties in a complaint is not a ground for dismissal of action.
3. The proper remedy when a party is left out is to implead the indispensable party at any
stage of the action. The court, either motu proprio or upon the motion of a party, may
order the inclusion of the indispensable party or give the plaintiff an opportunity to
amend his complaint in order to include indispensable parties.
4. If the plaintiff to whom the order to include the indispensable party is directed refuses
to comply with the order of the court, the complaint may be dismissed upon motion of
the defendant or upon the court's own motion.
a. Only upon unjustified failure or refusal to obey the order to include or to
amend is the action dismissed.
5. RTC Order requiring Karen Go to join her husband as a party plaintiff is fully in order.
3. AGDEPPA v HEIRS OF IGNACIO BONETE
G.R. No. 164436 | January 15, 2010 | Nachura, J.
Digested by: Chua, Dane Larieze L.
DOCTRINE: ​Misjoinder of parties does not warrant the dismissal of the action based on Rule 3,
Section 11 of the Rules of Court.
FACTS:
1. In 1979, Dorotea Bonete, widow of the late Ignacio Bonete, obtained a loan in the amount of
P55,000 from Development Bank of the Philippines in order to buy farm implements, and
secured by an agricultural land in Cotobato.
2. Her children (respondents) received a notice of collection from the bank. They alleged that
Atty. Agdeppa accompanied their mother to DBP, obligated herself to pay the loan, and made
Dorotea sign a document (purportedly to be a deed of sale). Eventually, they were forcibly
ejected from the property.
3. The Bonete children inquired from the Register of Deeds and found that the title to the
property under Ignacio’s name had been transferred to Agdeppa.
4. Thus, they filed a complaint for reconveyance and annulment of deed of sale with the RTC.
5. Agdeppa filed a MTD, on the ground that the Bonete children were not the real parties in
interest and complaint stated no cause of action.
6. ​The complaint was later amended, impleading the other Agdeppa relatives.
7. RTC dismissed the amended complaint as the Bonete children were not real parties in
interest.
8. CA remanded the case because Dorotea, being a former owner, was a real party in interest.
ISSUE: ​Whether or not misjoinder of parties should result in dismissal -- NO
HELD: ​Although the Bonetechildren committed a procedural infraction before the RTC, this does
not justify the dismissal of the case. Misjoinder of parties does not warrant the dismissal of the
action based on Rule 3, Section 11 of the Rules of Court. The TCT, covering the subject
property, was issued in the name of Dorotea and this was admitted by the Agdeppas.
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Remedial Law Review I - Atty. Custodio
AY 2019 - 2020 (1st sem) ASUNCION, BONIFACIO, CAPILA, CHUA, CRUZ, GAON, GARCIA, INTIA, LAGO, MARTINEZ, NOMBRES, OBNAMIA, PERNES, REPOSAR, STA. ANA, TABALINGCOS, TEMPORAL
As the former owner of the property, Dorotea Bonete is a real party in interest and has legal
capacity to file case for reconveyance and annulment of deed of sale to question the propriety of
the TCT in the name of Agdeppa as the transaction was allegedly contemplated only to secure
Dorotea’s loan.
A liberal construction of the Rules is apt in situations involving excusable formal errors in a
pleading as long as the same do not subvert the essence of the proceeding, and they connote at
least a reasonable attempt at compliance with the Rules. To deprive the Bonete children and
Dorotea of their claims over the property on mere technicality is a travesty of justice and equity.
Thus, since the TCT and purported deed of sale were not put on record, a trial on the merits
should be conducted.
​PETITION IS DENIED.
4. LILIA B. ADA, LUZ B. ADANZA, FLORA C. BAYLON, REMO BAYLON, JOSE BAYLON,
ERIC BAYLON, FLORENTINO BAYLON, and MA. RUBY BAYLON, ​petitioners​, ​vs.
FLORANTE BAYLON, respondent.​ [G.R. No. 182435. August 13, 2012.]
FALLO: “​WHEREFORE​, in consideration of the foregoing disquisitions, the petition is
PARTIALLY GRANTED​. The Decision dated October 26, 2007 issued by the Court of Appeals
in CA-G.R. CV No. 01746 is ​MODIFIED in that the Decision dated October 20, 2005 issued by
the Regional Trial Court, Tanjay City, Negros Oriental, Branch 43 in Civil Case No. 11657,
insofar as it decreed the rescission of the Deed of Donation dated July 6, 1997 is hereby
REINSTATED​. The case is ​REMANDED to the trial court for the determination of the ownership
of Lot No. 4709 and half of Lot No. 4706 in accordance with this Decision.
SO ORDERED.​”
FACTS
This case involves the estate of spouses Florentino Baylon and Maximina Elnas Baylon
(Spouses Baylon) who were survived by their legitimate children, namely, Rita Baylon (Rita),
Victoria Baylon (Victoria), Dolores Baylon (Dolores), Panfila Gomez (Panfila), Ramon Baylon
(Ramon) and herein petitioner Lilia B. Ada (Lilia).
July 3, 1996: the petitioners filed ​with the RTC a ​Complaint for partition, accounting and
damages ​against Florante, Rita and Panfila.
· They alleged therein that Spouses Baylon, during their lifetime, owned 43 parcels
of land all situated in Negros Oriental.
· After the death of Spouses Baylon, they claimed that Rita took possession of the
said parcels of land and appropriated for herself the income from the same.
· Using the income produced by the said parcels of land, Rita allegedly purchased
two parcels of land situated in Canda-uay, Dumaguete City.
· Rita refused to effect a partition of the said parcels of land.
In their Answer, Florante, Rita and Panfila asserted that​:
· they and the petitioners co-owned 22 out of the 43 parcels of land mentioned in
the latter's complaint, whereas Rita actually owned 10 parcels of land out of the
43 parcels which the petitioners sought to partition, while the remaining 11
parcels of land are separately owned by Petra Cafino Adanza, Florante, Meliton
Adalia, Consorcia Adanza, Lilia and Santiago Mendez.
· Further, they claimed that the two lots in Dumaguete City were acquired by Rita
using her own money.
· They denied that Rita appropriated solely for herself the income of the estate of
Spouses Baylon, and expressed no objection to the partition of the estate of
Spouses Baylon, but only with respect to the co-owned parcels of land.
During the pendency of the case, Rita, through a ​Deed of Donation dated July 6, 1997,
conveyed the two lots to Florante. Rita died intestate and without any issue.
Thereafter, learning of the said donation ​inter vivos in favor of Florante, the ​petitioners filed a
Supplemental Pleading dated February 6, 2002, praying that the said donation in favor of
the respondent be rescinded​.
· further alleged that Rita was already sick and very weak when the said Deed of
Donation was supposedly executed and, thus, could not have validly given her
consent thereto.
Florante and Panfila opposed the rescission of the said donation, asserting that Article 1381 (4)
of the Civil Code applies only when there is already a prior judicial decree on who between the
contending parties actually owned the properties under litigation.
RTC Decision​: ​RTC regarded Rita as the owner of the said 10 parcels of land and,
accordingly, directed that the same be partitioned among her heirs. The RTC rescinded the
donation ​inter vivos.​
Florante sought reconsideration of the Decision insofar as it rescinded the donation in his
favor.
· He asserted that, at the time of Rita's death, the two parcels were no longer part
of her estate as the same had already been conveyed to him through a donation
inter vivos​ three years earlier.
· Thus, Florante maintained that the lots should not be included in the properties
that should be partitioned among the heirs of Rita.
RTC: denied the motion for reconsideration filed by Florante.
CA Decision: before the petitioners may file an action for rescission, they must first obtain a
favorable judicial ruling that the two lots actually belonged to the estate of Spouses Baylon
and not to Rita. Until then, the CA asserted, an action for rescission is premature. Further, the
CA ruled that the petitioners' action for rescission cannot be joined with their action for
partition, accounting and damages through a mere supplemental pleading.
Issue​: W/N the actions for partition and rescission can be joined in a single action (NO)
RULING
Misjoinder of Causes of Action
The complaint filed by the petitioners with the RTC involves two separate, distinct and
independent actions — partition and rescission.
1. First, the petitioners raised the refusal of their co-heirs, Florante, Rita and Panfila,
to partition the properties which they inherited from Spouses Baylon.
2. Second, in their supplemental pleading, the petitioners assailed the donation ​inter
vivos​ made by Rita in favor of Florante ​pendente lite.
The actions of partition and rescission cannot be joined in a single action.
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Remedial Law Review I - Atty. Custodio
AY 2019 - 2020 (1st sem) ASUNCION, BONIFACIO, CAPILA, CHUA, CRUZ, GAON, GARCIA, INTIA, LAGO, MARTINEZ, NOMBRES, OBNAMIA, PERNES, REPOSAR, STA. ANA, TABALINGCOS, TEMPORAL
Here, there was a misjoinder of causes of action. The action for partition filed by the petitioners
could not be joined with the action for the rescission of the said donation ​inter vivos in favor of
Florante. ​Lest it be overlooked, an action for partition is a special civil action governed by
Rule 69 of the ​Rules of Court while an action for rescission is an ordinary civil action
governed by the ordinary rules of civil procedure.
The variance in the procedure in the special civil action of partition and in the ordinary civil action
of rescission precludes their joinder in one complaint or their being tried in a single proceeding to
avoid confusion in determining what rules shall govern the conduct of the proceedings as well as
in the determination of the presence of requisite elements of each particular cause of action.
A misjoined cause of action, if not severed upon motion of a party or
by the court sua sponte, may be adjudicated by the court together with the other
causes of action.
Nevertheless, misjoinder of causes of action is ​not a ground for dismissal​.
Indeed, the courts have the power, acting upon the motion of a party to the case or ​sua sponte,
to order the severance of the misjoined cause of action to be proceeded with separately.
However, if there is no objection to the improper joinder or the court did not ​motu proprio direct a
severance, then there exists no bar in the simultaneous adjudication of all the erroneously joined
causes of action.
Here, Florante posed no objection, and neither did the RTC direct the severance of the
petitioners' action for rescission from their action for partition. While this may be a patent
omission on the part of the RTC, this does not constitute a ground to assail the validity and
correctness of its decision. The RTC validly adjudicated the issues raised in the actions for
partition and rescission filed by the petitioners.
A supplemental pleading may raise a new cause of action as long as it
has some relation to the original cause of action set forth in the
original complaint.
As its very name denotes, a supplemental pleading only serves to bolster or add something to
the primary pleading. A supplement exists side by side with the original. It does not replace
that which it supplements. Moreover, a supplemental pleading assumes that the original
pleading is to stand and that the issues joined with the original pleading remained an issue to
be tried in the action. It is but a continuation of the complaint.
Its usual office is to set up new facts which justify, enlarge or change the kind of relief
with respect to the same subject matter as the controversy referred to in the original
complaint.
The purpose of the supplemental pleading is to bring into the records new facts which
will enlarge or change the kind of relief to which the plaintiff is entitled; hence, any
supplemental facts which further develop the original right of action, or extend to vary
the relief, are available by way of supplemental complaint even though they themselves
constitute a right of action​.
Thus, a supplemental pleading may properly allege transactions, occurrences or events which
had transpired after the filing of the pleading sought to be supplemented, even if the said
supplemental facts constitute another cause of action.
While a matter stated in a supplemental complaint should have some relation to the cause of
action set forth in the original pleading, ​the fact that the supplemental pleading technically
states a new cause of action should not be a bar to its allowance but only a matter that
may be considered by the court in the exercise of its discretion​. In such cases, we stressed
that a broad definition of "cause of action" should be applied.
5. ​Central Bank Board of Liquidators vs. Banco Filipino Savings and Mortgage Bank (GR.
No. 173399)
FACTS:
CB – Central Bank
MB – Monetary Board
1. 1963: The MB of the then CB issued MB Resolution No. 223 allowing respondent
Banco Filipino to operate as a savings bank
2. 1984: CB issued MB Resolution No. 955 placing Banco Filipino under conservatorship
after granting the latter's loan applications worth billions of pesos
3. Banco Filipino then filed with the RTC Makati a Complaint against the CB for the
annulment of MB Resolution No. 955 ​(Civil Case No. 8108)
4. 1985: CB issued MB Resolution No. 75 ordering the closure of Banco Filipino and
placing the latter under receivership
a. Resolution stated that since respondent had been found to be insolvent, the
latter was forbidden to continue doing business to prevent further losses to
its depositors and creditors.
b. Resolution further provided for the takeover of the assets and liabilities
5. Banco Filipino filed a Complaint with the RTC Makati against the MB, assailing the
latter's act of placing the bank under receivership ​(Civil Case No. 9675)
6. Because of its impending closure, Banco Filipino filed with the CA a Petition for
Certiorari and Mandamus seeking the annulment of MB Resolution No. 75 on the
ground of grave abuse of discretion in the issuance of the Resolution.
7. CB issued another Resolution placing Banco Filipino under liquidation
8. Banco Filipino then filed another Complaint with the RTC Makati to question the
propriety of the liquidation ​(Civil Case No. 10183)
9. SC directed the consolidation in Branch 136 of the RTC Makati the 3 cases: (1) Civil
Case No. 8108, the case for the annulment of the conservatorship order; (2) Civil
Case No. 9675, the case seeking to annul the receivership order; and (3) Civil Case
No. 10183, the case seeking to annul the order for the liquidation of the bank
10. SC, in an En Banc Decision, nullified MB Resolution No. 75 and ordered the CB and
its MB to reorganize the bank and allow it to resume business
11. 1993: During the pendency of the three consolidated cases, RA No. 7653, or the New
Central Bank Act of 1993, took effect.
a. CB was abolished and, in its stead, the BSP was created.
b. It also created the CB-Board of Liquidators for the purpose of administering
and liquidating the CB's assets and liabilities, not all of which had been
transferred to the BSP.
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Remedial Law Review I - Atty. Custodio
AY 2019 - 2020 (1st sem) ASUNCION, BONIFACIO, CAPILA, CHUA, CRUZ, GAON, GARCIA, INTIA, LAGO, MARTINEZ, NOMBRES, OBNAMIA, PERNES, REPOSAR, STA. ANA, TABALINGCOS, TEMPORAL
12. Pursuant to the Decision of this Court in G.R. No. 70054, the BSP reopened Banco
Filipino and allowed it to resume business
13. 1995: Pursuant to the recent development, Banco Filipino filed a Motion to Admit
Attached Amended/Supplemental Complaint in the three consolidated cases — Civil
Case Nos. 8108, 9675, and 10183 — before the RTC
a. It sought to substitute the CB-BOL for the defunct CB and its MB.
b. It also aimed to recover at least P18 billion in actual damages, litigation
expenses, attorney's fees, interests, and costs of suit against petitioner and
individuals who had allegedly acted with malice and evident bad faith in
placing the bank under conservatorship and eventually closing it down in
1985
14. RTC: granted the Motion to Admit filed by Banco Filipino and accordingly admitted the
latter's Amended/Supplemental Complaint
15. Consequently, the CB-BOL was substituted for the defunct CB in respondent's civil
cases, which are still pending with the RTC
16. 2003: or more than 10 years from the enactment of R.A. 7653, Banco Filipino again
filed a ​Motion to Admit Second Amended/Supplemental Complaint ​in the
consolidated civil cases before the RTC.
a. It sought to include the BSP and its MB — the purported
successor-in-interest of the old CB and as additional defendants
b. Banco Filipino claimed that the BSP employed "coercive measures" that
forced respondent to enter into a Memorandum of Agreement (MOA)
regarding the collection of advances extended to the latter by the defunct
CB
17. Opposition by the CB on the ff grounds:
a. 2nd amendment raised new and independent causes of action against a
new party — the BSP — which was not an original part
b. 2nd amendment was violative of the rule on the joinder of causes of action,
because it alleged those that did not arise from the same contract,
transaction or relation between the parties — as opposed to those alleged in
the complaint sought to be amended or supplemented — and differed from
the causes of action cited in the original Complain
18. RTC: granted the Motion to Admit Banco Filipino's Second Amended/Supplemental
Complaint.
19. MR Denied, Petition for Certiorari before the CA
20. CA dismissed the CB-BOL's Petition and affirmed in toto the trial court's Order
admitting the Second Amended/Supplemental Complaint.
ISSUE: WON RTC (and CA) correctly admitted the 2​nd amended complaint DESPITE THE FACT
PARTIES, SUBJECT MATTER AND CAUSES OF ACTION ASSERTED THEREIN ARE
DIFFERENT FROM AND TOTALLY UNRELATED to the 1​st amended complaint? NO! RTC and
CA WRONG!
FALLO: WHEREFORE, the Petition of the CB-BOL is GRANTED, and the Decision of the Court
of Appeals dated 27 January 2006 and Resolution dated 27 June 2006 in CA- G.R. SP No.
86697 are hereby REVERSED and SET ASIDE. SICDAa
The RTC National Capital Judicial Region, Makati City, Branch 136 is hereby DIRECTED to
proceed with the trial of this case with utmost dispatch.
HELD:
1. Amendment:
● Rule 10 of the 1997 Revised Rules of Court allows the parties to amend their
pleadings (a) by adding or striking out an allegation or a party's name; or (b) by
correcting a mistake in the name of a party or rectifying a mistaken or an inadequate
allegation or description in the pleadings for the purpose of determining the actual
merits of the controversy in the most inexpensive and expeditious manner.
● If the purpose is to set up a cause of action not existing at the time of the filing of the
complaint, amendment is not allowed. If no right existed at the time the action was
commenced, the suit cannot be maintained, even if the right of action may have
accrued thereafter
● Applying to the case: the causes of action subject of the Second
Amended/Supplemental Complaint only arose in 1994 — well after those subject of
the original Complaint. The original Complaint was based on the alleged illegal closure
of Banco Filipino effected in 1985 by the defunct CB and its MB
2. Supplement:
● Rule 10 of the 1997 Revised Rules of Court allows the parties to supplement their
pleadings by setting forth transactions, occurrences, or events that happened since
the date of the pleading sought to be supplemented
● A supplemental pleading only serves to bolster or add something to the primary
pleading. Its usual function is to set up new facts that justify, enlarge, or change the
kind of relief sought with respect to the same subject matter as that of the original
complaint
● Applying to the case: Banco Filipino, through the Second Amended/Supplemental
Complaint, attempted to raise new and different causes of action that arose only in
1994. These causes of action had no relation whatsoever to the causes of action in
the original Complaint, as they involved different acts or omissions, transactions, and
parties.
3. Joinder Rules violated by Amendment/ Supplement:
● The joinder of causes of action is indeed allowed under Section 5, Rule 2 of the 1997
Rules of Court; but if there are ​multiple parties, the joinder is made subject to the
rules on joinder of parties under Section 6, Rule 3​.
○ Specifically, before causes of action and parties can be joined in a
complaint involving multiple parties, (1) the right to relief must arise out of
the same transaction or series of transactions and (2) there must be a
question of law or fact common to all the parties.
● Case involved MULTIPLE PARTIES – defunct CB and MB different from BSP and MB
○ As to the Rules:
○ FIRST, the reliefs for damages prayed for by respondent did not arise from
the same transaction or series of transactions. 1​st amendment arose from
the closure of Banco Filipino by the defunct CB and its MB, the damages
prayed for in the 2​nd amendment arose from the alleged acts of oppression
committed by the BSP and its MB against respondent.
○ SECOND, there is no common question of fact or law between the parties
involved. The acts attributed by Banco Filipino to the BSP and its MB
pertain to events that transpired after this Court ordered the respondent
bank's reopening in 1994. These acts bear no relation to those alleged in
the original Complaint, which related to the propriety of the closure and
liquidation of respondent as a banking institution way back in 1985.