Monthly Archives: January 2017

Tiu, et al. v. Philippine Bank of Communications, G.R. No. 151932, 19 August 2009.



In a collection suit filed by PBCOM against petitioners Tiu, et al., the former demanded from the latter the full payment of its secured loan obligation. PBCOM’s claim is supported by a Suretyship Agreement signed by all members of the Board of Directors of Asian Water Resources, Inc. (AWRI), including petitioners. This was controverted in petitioners’ Answer saying that the Surety Agreement was falsified to insert the wordings “IN THEIR OWN CAPACITY” without their consent, attaching a certified copy of the same document from the Records Management and Archives Office in Davao City. PBCOM then filed a Reply and Answer to Counterclaim with Motion for Leave of Court to Substitute Annex “A” of the Complaint, wherein it attached the duplicate original copy retrieved from the file of the notary public. PBCOM also admitted its mistake in making the insertion and explained that it was made without the knowledge and consent of the notary public. PBCOM maintained that the insertion was not a falsification, but was made only to speak the truth of the parties’ intentions. The trial court allowed the substitution of the altered document. Petitioners move for reconsideration but was denied. The case was elevated to the Court of Appeals in a petition for certiorari under Rule 65 but only to affirm in toto the trial court’s assailed order.


Is the Court of Appeals correct in affirming the trial court’s order allowing the substitution of the “falsified” actionable document, notwithstanding it appears to have substantially altered the cause of action?


[W]ith respect to PBCOM’s right to amend its complaint, including the documents annexed thereto, after petitioners have filed their answer, Section 3, Rule 10 of the Rules of Court specifically allows amendment by leave of court.

This Court has emphasized the import of Section 3, Rule 10 of the 1997 Rules of Civil Procedure in Valenzuela v. Court of Appeals, thus:

“Interestingly, Section 3, Rule 10 of the 1997 Rules of Civil Procedure amended the former rule in such manner that the phrase “or that the cause of action or defense is substantially altered” was stricken-off and not retained in the new rules. The clear import of such amendment in Section 3, Rule 10 is that under the new rules, “the amendment may (now) substantially alter the cause of action or defense.” This should only be true, however, when despite a substantial change or alteration in the cause of action or defense, the amendments sought to be made shall serve the higher interests of substantial justice, and prevent delay and equally promote the laudable objective of the rules which is to secure a “just, speedy and inexpensive disposition of every action and proceeding.”

The granting of leave to file amended pleading is a matter particularly addressed to the sound discretion of the trial court; and that discretion is broad, subject only to the limitations that the amendments should not substantially change the cause of action or alter the theory of the case, or that it was not made to delay the action. Nevertheless, as enunciated in Valenzuela, even if the amendment substantially alters the cause of action or defense, such amendment could still be allowed when it is sought to serve the higher interest of substantial justice; prevent delay; and secure a just, speedy and inexpensive disposition of actions and proceedings.

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Posted by on January 30, 2017 in Case Digests, Civil Procedure, Remedial Law


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Katon v. Palanca, et al., G.R. No. 151149, 07 September 2004.



Petitioner Katon contends that the whole area known as Sombrero Island, located in Tagpait, Aborlan, Palawan, had been classified from forest land to agricultural land and certified available for disposition upon his request and at his instance. However, Palawan authorities then favorably endorsed the request of Respondent Palanca, together with some others, which resulted in the issuance of homestead patent in Palanca’s favor in 1977 among others. In 1999, filed a petition which seeks to nullify the homestead patents and original certificates of title issued in favor of the Palanca et al. as well as the reconveyance of the whole island in his favor. Palanca et al. filed their Answer and Motion to Dismiss. The trial court dismissed Katon’s Complaint as well as his subsequent motion for reconsideration.

Katon filed a petition for certiorari with the Court of Appeals (CA). The petition was dismissed motu proprio pursuant to the appellate court’s residual prerogative. The CA ruled that prescription had already barred the action for reconveyance. Katon questions this dismissal. He submits that the CA erroneously invoked its residual prerogatives under Section 1 of Rule 9 of the Rules of Court when it motu proprio dismissed the Petition for lack of jurisdiction and prescription. According to him, residual prerogative refers to the power that the trial court, in the exercise of its original jurisdiction, may still validly exercise even after perfection of an appeal. It follows that such powers are not possessed by an appellate court.


Was the Court of Appeals correct in applying residual prerogative in dismissing a case motu proprio based on prescription?


Petitioner has confused what the CA adverted to as its residual prerogatives under Section 1 of Rule 9 of the Rules of Court with the residual jurisdiction of trial courts over cases appealed to the CA.

Under Section 1 of Rule 9 of the Rules of Court, defenses and objections not pleaded either in a motion to dismiss or in the answer are deemed waived, except when (1) lack of jurisdiction over the subject matter, (2) litis pendentia, (3) res judicata and (4) prescription are evident from the pleadings or the evidence on record. In the four excepted instances, the court shall motu proprio dismiss the claim or action. xxx On the other hand, residual jurisdiction is embodied in Section 9 of Rule 41 of the Rules of Court, xxx The residual jurisdiction of trial courts is available at a stage in which the court is normally deemed to have lost jurisdiction over the case or the subject matter involved in the appeal. This stage is reached upon the perfection of the appeals by the parties or upon the approval of the records on appeal, but prior to the transmittal of the original records or the records on appeal. In either instance, the trial court still retains its so-called residual jurisdiction to issue protective orders, approve compromises, permit appeals of indigent litigants, order execution pending appeal, and allow the withdrawal of the appeal.

The CA’s motu proprio dismissal of petitioners Complaint could not have been based, therefore, on residual jurisdiction under Rule 41. Undeniably, such order of dismissal was not one for the protection and preservation of the rights of the parties, pending the disposition of the case on appeal. What the CA referred to as residual prerogatives were the general residual powers of the courts to dismiss an action motu proprio upon the grounds mentioned in Section 1 of Rule 9 of the Rules of Court and under authority of Section 2 of Rule 1 of the same rules.

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Posted by on January 21, 2017 in Case Digests, Civil Procedure, Remedial Law


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Continental Steel Manufacturing Corp. v. Montao, 182836, 13 October 2009.



Hortillano, an employee of Continental Steel, filed a claim for Paternity Leave, Bereavement Leave and Death and Accident Insurance for dependent pursuant to the Collective Bargaining Agreement (CBA) concluded between Continental and the Union. The claim was based on the death of Hortillano’s unborn child. Hortillanos wife, had a premature delivery while she was in the 38th week of pregnancy. According to the Certificate of Fetal Death, the female fetus died during labor due to fetal Anoxia secondary to uteroplacental insufficiency. Continental Steel immediately granted Hortillanos claim for paternity leave but denied his claims for bereavement leave and other death benefits, consisting of the death and accident insurance. Continental Steel posited that the express provision of the CBA did not contemplate the death of an unborn child, a fetus, without legal personality. Continental Steel, relying on Articles 40, 41 and 42 of the Civil Code, contended that only one with civil personality could die. Hence, the unborn child never died because it never acquired juridical personality. Proceeding from the same line of thought, Continental Steel reasoned that a fetus that was dead from the moment of delivery was not a person at all.


ISSUE: Whether death can only happen to one with civil/juridical personality.



The reliance of Continental Steel on Articles 40, 41 and 42 of the Civil Code for the legal definition of death is misplaced. Article 40 provides that a conceived child acquires personality only when it is born, and Article 41 defines when a child is considered born. Article 42 plainly states that civil personality is extinguished by death.

First, the issue of civil personality is not relevant herein. Articles 40, 41 and 42 of the Civil Code on natural persons, must be applied in relation to Article 37 of the same Code, the very first of the general provisions on civil personality.

We need not establish civil personality of the unborn child herein since his/her juridical capacity and capacity to act as a person are not in issue. It is not a question before us whether the unborn child acquired any rights or incurred any obligations prior to his/her death that were passed on to or assumed by the child’s parents. The rights to bereavement leave and other death benefits in the instant case pertain directly to the parents of the unborn child upon the latters death.

Second, Sections 40, 41 and 42 of the Civil Code do not provide at all a definition of death. Moreover, while the Civil Code expressly provides that civil personality may be extinguished by death, it does not explicitly state that only those who have acquired juridical personality could die.

And third, death has been defined as the cessation of life. Life is not synonymous with civil personality. One need not acquire civil personality first before he/she could die. Even a child inside the womb already has life. No less than the Constitution recognizes the life of the unborn from conception, that the State must protect equally with the life of the mother. If the unborn already has life, then the cessation thereof even prior to the child being delivered, qualifies as death.


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