cases

1. G.R. No. 175723 February 4, 2014
THE CITY OF MANILA, represented by MAYOR JOSE L. ATIENZA, JR., and MS. LIBERTY M. TOLEDO, in her
capacity as the City Treasurer of Manila, Petitioners,
vs.
HON. CARIDAD H. GRECIA-CUERDO, in her capacity as Presiding Judge of the Regional Trial Court, Branch
112, Pasay City; SM MART, INC.; SM PRIME HOLDINGS, INC.; STAR APPLIANCES CENTER; SUPERVALUE,
INC.; ACE HARDWARE PHILIPPINES, INC.; WATSON PERSONAL CARE STORES, PHILS., INC.; JOLLIMART
PHILS., CORP.; SURPLUS MARKETING CORPORA TION and SIGNATURE LINES, Respondents.
D E C I S I O N
PERALTA, J.:
Before the Court is a special civil action for certiorari under Rule 65 of the Rules of Court seeking to reverse and set aside
the Resolutions dated April 6, 2006 and November 29, 2006 of the Court of Appeals (CA) in CA-G.R. SP No. 87948.
The antecedents of the case, as summarized by the CA, are as follows:
The record shows that petitioner City of Manila, through its treasurer, petitioner Liberty Toledo, assessed taxes for the
taxable period from January to December 2002 against private respondents SM Mart, Inc., SM Prime Holdings, Inc., Star
Appliances Center, Supervalue, Inc., Ace Hardware Philippines, Inc., Watsons Personal Care Stores Phils., Inc., Jollimart
Philippines Corp., Surplus Marketing Corp. and Signature Lines. In addition to the taxes purportedly due from private
respondents pursuant to Section 14, 15, 16, 17 of the Revised Revenue Code of Manila (RRCM), said assessment covered
the local business taxes petitioners were authorized to collect under Section 21 of the same Code. Because payment of
the taxes assessed was a precondition for the issuance of their business permits, private respondents were constrained to
pay the P19,316,458.77 assessment under protest.
On January 24, 2004, private respondents filed [with the Regional Trial Court of Pasay City] the complaint denominated
as one for "Refund or Recovery of Illegally and/or Erroneously-Collected Local Business Tax, Prohibition with Prayer to
Issue TRO and Writ of Preliminary Injunction" which was docketed as Civil Case No. 04-0019-CFM before public
respondent's sala [at Branch 112]. In the amended complaint they filed on February 16, 2004, private respondents
alleged that, in relation to Section 21 thereof, Sections 14, 15, 16, 17, 18, 19 and 20 of the RRCM were violative of the
limitations and guidelines under Section 143 (h) of Republic Act. No. 7160 [Local Government Code] on double taxation.
They further averred that petitioner city's Ordinance No. 8011 which amended pertinent portions of the RRCM had
already been declared to be illegal and unconstitutional by the Department of Justice.
In its Order dated July 9, 2004, the RTC granted private respondents' application for a writ of preliminary injunction.
Petitioners filed a Motion for Reconsideration but the RTC denied it in its Order dated October 15, 2004.
Petitioners then filed a special civil action for certiorari with the CA assailing the July 9, 2004 and October 15, 2004 Orders
of the RTC.
In its Resolution promulgated on April 6, 2006, the CA dismissed petitioners' petition for certiorari holding that it has no
jurisdiction over the said petition. The CA ruled that since appellate jurisdiction over private respondents' complaint for
tax refund, which was filed with the RTC, is vested in the Court of Tax Appeals (CTA), pursuant to its expanded
jurisdiction under Republic Act No. 9282 (RA 9282), it follows that a petition for certiorari seeking nullification of an
interlocutory order issued in the said case should, likewise, be filed with the CTA.
Petitioners filed a Motion for Reconsideration, but the CA denied it in its Resolution dated November 29, 2006.
Hence, the present petition raising the following issues:
I- Whether or not the Honorable Court of Appeals gravely erred in dismissing the case for lack of jurisdiction.
II- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack or excess
of jurisdiction in enjoining by issuing a Writ of Injunction the petitioners, their agents and/or authorized
representatives from implementing Section 21 of the Revised Revenue Code of Manila, as amended, against
private respondents.
III- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack or excess
of jurisdiction in issuing the Writ of Injunction despite failure of private respondents to make a written claim for
tax credit or refund with the City Treasurer of Manila.
IV- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack or excess
of jurisdiction considering that under Section 21 of the Manila Revenue Code, as amended, they are mere
collecting agents of the City Government.
V- Whether or not the Honorable Regional Trial Court gravely abuse[d] its discretion amounting to lack or excess
of jurisdiction in issuing the Writ of Injunction because petitioner City of Manila and its constituents would result
to greater damage and prejudice thereof. (sic)

2. Without first resolving the above issues, this Court finds that the instant petition should be denied for being moot and
academic.
Upon perusal of the original records of the instant case, this Court discovered that a Decision in the main case had
already been rendered by the RTC on August 13, 2007, the dispositive portion of which reads as follows:
WHEREFORE, in view of the foregoing, this Court hereby renders JUDGMENT in favor of the plaintiff and against the
defendant to grant a tax refund or credit for taxes paid pursuant to Section 21 of the Revenue Code of the City of Manila
as amended for the year 2002 in the following amounts:
To plaintiff SM Mart, Inc. - P 11,462,525.02
To plaintiff SM Prime Holdings, Inc. - 3,118,104.63
To plaintiff Star Appliances Center - 2,152,316.54
To plaintiff Supervalue, Inc. - 1,362,750.34
To plaintiff Ace Hardware Phils., Inc. - 419,689.04
To plaintiff Watsons Personal Care Health - 231,453.62
Stores Phils., Inc.
To plaintiff Jollimart Phils., Corp. - 140,908.54
To plaintiff Surplus Marketing Corp. - 220,204.70
To plaintiff Signature Mktg. Corp. - 94,906.34
TOTAL: - P 19,316,458.77
Defendants are further enjoined from collecting taxes under Section 21, Revenue Code of Manila from herein plaintiff.
SO ORDERED.
The parties did not inform the Court but based on the records, the above Decision had already become final and
executory per the Certificate of Finality issued by the same trial court on October 20, 2008. In fact, a Writ of Execution
was issued by the RTC on November 25, 2009. In view of the foregoing, it clearly appears that the issues raised in the
present petition, which merely involve the incident on the preliminary injunction issued by the RTC, have already become
moot and academic considering that the trial court, in its decision on the merits in the main case, has already ruled in
favor of respondents and that the same decision is now final and executory. Well entrenched is the rule that where the
issues have become moot and academic, there is no justiciable controversy, thereby rendering the resolution of the same
of no practical use or value.
In any case, the Court finds it necessary to resolve the issue on jurisdiction raised by petitioners owing to its significance
and for future guidance of both bench and bar. It is a settled principle that courts will decide a question otherwise moot
and academic if it is capable of repetition, yet evading review.
However, before proceeding, to resolve the question on jurisdiction, the Court deems it proper to likewise address a
procedural error which petitioners committed.
Petitioners availed of the wrong remedy when they filed the instant special civil action for certiorari under Rule 65 of the
Rules of Court in assailing the Resolutions of the CA which dismissed their petition filed with the said court and their
motion for reconsideration of such dismissal. There is no dispute that the assailed Resolutions of the CA are in the nature
of a final order as they disposed of the petition completely. It is settled that in cases where an assailed judgment or order
is considered final, the remedy of the aggrieved party is appeal. Hence, in the instant case, petitioner should have filed a
petition for review on certiorari under Rule 45, which is a continuation of the appellate process over the original case.
Petitioners should be reminded of the equally-settled rule that a special civil action for certiorari under Rule 65 is an
original or independent action based on grave abuse of discretion amounting to lack or excess of jurisdiction and it will lie
only if there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law. As such, it
cannot be a substitute for a lost appeal.
Nonetheless, in accordance with the liberal spirit pervading the Rules of Court and in the interest of substantial justice,
this Court has, before, treated a petition for certiorari as a petition for review on certiorari, particularly (1) if the petition
for certiorari was filed within the reglementary period within which to file a petition for review on certiorari; (2) when
errors of judgment are averred; and (3) when there is sufficient reason to justify the relaxation of the rules. Considering
that the present petition was filed within the 15-day reglementary period for filing a petition for review on certiorari under
Rule 45, that an error of judgment is averred, and because of the significance of the issue on jurisdiction, the Court
deems it proper and justified to relax the rules and, thus, treat the instant petition for certiorari as a petition for review on
certiorari.
Having disposed of the procedural aspect, we now turn to the central issue in this case. The basic question posed before
this Court is whether or not the CTA has jurisdiction over a special civil action for certiorari assailing an interlocutory order
issued by the RTC in a local tax case.

3. This Court rules in the affirmative.
On June 16, 1954, Congress enacted Republic Act No. 1125 (RA 1125) creating the CTA and giving to the said court
jurisdiction over the following:
(1) Decisions of the Collector of Internal Revenue in cases involving disputed assessments, refunds of internal
revenue taxes, fees or other charges, penalties imposed in relation thereto, or other matters arising under the
National Internal Revenue Code or other law or part of law administered by the Bureau of Internal Revenue;
(2) Decisions of the Commissioner of Customs in cases involving liability for customs duties, fees or other money
charges; seizure, detention or release of property affected fines, forfeitures or other penalties imposed in relation
thereto; or other matters arising under the Customs Law or other law or part of law administered by the Bureau
of Customs; and
(3) Decisions of provincial or City Boards of Assessment Appeals in cases involving the assessment and taxation
of real property or other matters arising under the Assessment Law, including rules and regulations relative
thereto.
On March 30, 2004, the Legislature passed into law Republic Act No. 9282 (RA 9282) amending RA 1125 by expanding
the jurisdiction of the CTA, enlarging its membership and elevating its rank to the level of a collegiate court with special
jurisdiction. Pertinent portions of the amendatory act provides thus:
Sec. 7. Jurisdiction. - The CTA shall exercise:
a. Exclusive appellate jurisdiction to review by appeal, as herein provided:
1. Decisions of the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of
internal revenue taxes, fees or other charges, penalties in relation thereto, or other matters arising under
the National Internal Revenue or other laws administered by the Bureau of Internal Revenue;
2. Inaction by the Commissioner of Internal Revenue in cases involving disputed assessments, refunds of
internal revenue taxes, fees or other charges, penalties in relations thereto, or other matters arising
under the National Internal Revenue Code or other laws administered by the Bureau of Internal Revenue,
where the National Internal Revenue Code provides a specific period of action, in which case the inaction
shall be deemed a denial;
3. Decisions, orders or resolutions of the Regional Trial Courts in local tax cases originally decided or
resolved by them in the exercise of their original or appellate jurisdiction;
4. Decisions of the Commissioner of Customs in cases involving liability for customs duties, fees or other
money charges, seizure, detention or release of property affected, fines, forfeitures or other penalties in
relation thereto, or other matters arising under the Customs Law or other laws administered by the
Bureau of Customs;
5. Decisions of the Central Board of Assessment Appeals in the exercise of its appellate jurisdiction over
cases involving the assessment and taxation of real property originally decided by the provincial or city
board of assessment appeals;
6. Decisions of the Secretary of Finance on customs cases elevated to him automatically for review from
decisions of the Commissioner of Customs which are adverse to the Government under Section 2315 of
the Tariff and Customs Code;
7. Decisions of the Secretary of Trade and Industry, in the case of nonagricultural product, commodity or
article, and the Secretary of Agriculture in the case of agricultural product, commodity or article, involving
dumping and countervailing duties under Section 301 and 302, respectively, of the Tariff and Customs
Code, and safeguard measures under Republic Act No. 8800, where either party may appeal the decision
to impose or not to impose said duties.
b. Jurisdiction over cases involving criminal offenses as herein provided:
1. Exclusive original jurisdiction over all criminal offenses arising from violations of the National Internal
Revenue Code or Tariff and Customs Code and other laws administered by the Bureau of Internal
Revenue or the Bureau of Customs: Provided, however, That offenses or felonies mentioned in this
paragraph where the principal amount of taxes and fees, exclusive of charges and penalties, claimed is
less than One million pesos (P1,000,000.00) or where there is no specified amount claimed shall be tried
by the regular Courts and the jurisdiction of the CTA shall be appellate. Any provision of law or the Rules
of Court to the contrary notwithstanding, the criminal action and the corresponding civil action for the
recovery of civil liability for taxes and penalties shall at all times be simultaneously instituted with, and
jointly determined in the same proceeding by the CTA, the filing of the criminal action being deemed to
necessarily carry with it the filing of the civil action, and no right to reserve the filing of such civil action
separately from the criminal action will be recognized.
2. Exclusive appellate jurisdiction in criminal offenses:

4. a. Over appeals from the judgments, resolutions or orders of the Regional Trial Courts in tax cases originally decided by
them, in their respected territorial jurisdiction.
b. Over petitions for review of the judgments, resolutions or orders of the Regional Trial Courts in the exercise of their
appellate jurisdiction over tax cases originally decided by the Metropolitan Trial Courts, Municipal Trial Courts and
Municipal Circuit Trial Courts in their respective jurisdiction.
c. Jurisdiction over tax collection cases as herein provided:
1. Exclusive original jurisdiction in tax collection cases involving final and executory assessments for
taxes, fees, charges and penalties: Provides, however, that collection cases where the principal amount
of taxes and fees, exclusive of charges and penalties, claimed is less than One million pesos
(P1,000,000.00) shall be tried by the proper Municipal Trial Court, Metropolitan Trial Court and Regional
Trial Court.
2. Exclusive appellate jurisdiction in tax collection cases:
a. Over appeals from the judgments, resolutions or orders of the Regional Trial Courts in tax collection cases originally
decided by them, in their respective territorial jurisdiction.
b. Over petitions for review of the judgments, resolutions or orders of the Regional Trial Courts in the Exercise of their
appellate jurisdiction over tax collection cases originally decided by the Metropolitan Trial Courts, Municipal Trial Courts
and Municipal Circuit Trial Courts, in their respective jurisdiction.
A perusal of the above provisions would show that, while it is clearly stated that the CTA has exclusive appellate
jurisdiction over decisions, orders or resolutions of the RTCs in local tax cases originally decided or resolved by them in
the exercise of their original or appellate jurisdiction, there is no categorical statement under RA 1125 as well as the
amendatory RA 9282, which provides that th e CTA has jurisdiction over petitions for certiorari assailing interlocutory
orders issued by the RTC in local tax cases filed before it.
The prevailing doctrine is that the authority to issue writs of certiorari involves the exercise of original jurisdiction which
must be expressly conferred by the Constitution or by law and cannot be implied from the mere existence of appellate
jurisdiction. Thus, in the cases of Pimentel v. COMELEC, Garcia v. De Jesus, Veloria v. COMELEC, Department of Agrarian
Reform Adjudication Board v. Lubrica, and Garcia v. Sandiganbayan, this Court has ruled against the jurisdiction of courts
or tribunals over petitions for certiorari on the ground that there is no law which expressly gives these tribunals such
power. It must be observed, however, that with the exception of Garcia v. Sandiganbayan, these rulings pertain not to
regular courts but to tribunals exercising quasi-judicial powers. With respect to the Sandiganbayan, Republic Act No. 8249
now provides that the special criminal court has exclusive original jurisdiction over petitions for the issuance of the writs
of mandamus, prohibition, certiorari, habeas corpus, injunctions, and other ancillary writs and processes in aid of its
appellate jurisdiction.
In the same manner, Section 5 (1), Article VIII of the 1987 Constitution grants power to the Supreme Court, in the
exercise of its original jurisdiction, to issue writs of certiorari, prohibition and mandamus. With respect to the Court of
Appeals, Section 9 (1) of Batas Pambansa Blg. 129 (BP 129) gives the appellate court, also in the exercise of its original
jurisdiction, the power to issue, among others, a writ of certiorari,whether or not in aid of its appellate jurisdiction. As to
Regional Trial Courts, the power to issue a writ of certiorari, in the exercise of their original jurisdiction, is provided under
Section 21 of BP 129.
The foregoing notwithstanding, while there is no express grant of such power, with respect to the CTA, Section 1, Article
VIII of the 1987 Constitution provides, nonetheless, that judicial power shall be vested in one Supreme Court and in such
lower courts as may be established by law and that judicial power includes the duty of the courts of justice to settle
actual controversies involving rights which are legally demandable and enforceable, and to determine whether or not
there has been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or
instrumentality of the Government.
On the strength of the above constitutional provisions, it can be fairly interpreted that the power of the CTA includes that
of determining whether or not there has been grave abuse of discretion amounting to lack or excess of jurisdiction on the
part of the RTC in issuing an interlocutory order in cases falling within the exclusive appellate jurisdiction of the tax court.
It, thus, follows that the CTA, by constitutional mandate, is vested with jurisdiction to issue writs of certiorari in these
cases.
Indeed, in order for any appellate court to effectively exercise its appellate jurisdiction, it must have the authority to
issue, among others, a writ of certiorari. In transferring exclusive jurisdiction over appealed tax cases to the CTA, it can
reasonably be assumed that the law intended to transfer also such power as is deemed necessary, if not indispensable, in
aid of such appellate jurisdiction. There is no perceivable reason why the transfer should only be considered as partial,
not total.
Consistent with the above pronouncement, this Court has held as early as the case of J.M. Tuason & Co., Inc. v.
Jaramillo, et al. that "if a case may be appealed to a particular court or judicial tribunal or body, then said court or judicial
tribunal or body has jurisdiction to issue the extraordinary writ of certiorari, in aid of its appellate jurisdiction." This
principle was affirmed in De Jesus v. Court of Appeals, where the Court stated that "a court may issue a writ of certiorari
in aid of its appellate jurisdiction if said court has jurisdiction to review, by appeal or writ of error, the final orders or
decisions of the lower court." The rulings in J.M. Tuason and De Jesus were reiterated in the more recent cases of
Galang, Jr. v. Geronimo and Bulilis v. Nuez.

5. Furthermore, Section 6, Rule 135 of the present Rules of Court provides that when by law, jurisdiction is conferred on a
court or judicial officer, all auxiliary writs, processes and other means necessary to carry it into effect may be employed
by such court or officer.
If this Court were to sustain petitioners' contention that jurisdiction over their certiorari petition lies with the CA, this
Court would be confirming the exercise by two judicial bodies, the CA and the CTA, of jurisdiction over basically the same
subject matter – precisely the split-jurisdiction situation which is anathema to the orderly administration of justice.35 The
Court cannot accept that such was the legislative motive, especially considering that the law expressly confers on the
CTA, the tribunal with the specialized competence over tax and tariff matters, the role of judicial review over local tax
cases without mention of any other court that may exercise such power. Thus, the Court agrees with the ruling of the CA
that since appellate jurisdiction over private respondents' complaint for tax refund is vested in the CTA, it follows that a
petition for certiorari seeking nullification of an interlocutory order issued in the said case should, likewise, be filed with
the same court. To rule otherwise would lead to an absurd situation where one court decides an appeal in the main case
while another court rules on an incident in the very same case.
Stated differently, it would be somewhat incongruent with the pronounced judicial abhorrence to split jurisdiction to
conclude that the intention of the law is to divide the authority over a local tax case filed with the RTC by giving to the CA
or this Court jurisdiction to issue a writ of certiorari against interlocutory orders of the RTC but giving to the CTA the
jurisdiction over the appeal from the decision of the trial court in the same case. It is more in consonance with logic and
legal soundness to conclude that the grant of appellate jurisdiction to the CTA over tax cases filed in and decided by the
RTC carries with it the power to issue a writ of certiorari when necessary in aid of such appellate jurisdiction. The
supervisory power or jurisdiction of the CTA to issue a writ of certiorari in aid of its appellate jurisdiction should co-exist
with, and be a complement to, its appellate jurisdiction to review, by appeal, the final orders and decisions of the RTC, in
order to have complete supervision over the acts of the latter.
A grant of appellate jurisdiction implies that there is included in it the power necessary to exercise it effectively, to make
all orders that will preserve the subject of the action, and to give effect to the final determination of the appeal. It carr ies
with it the power to protect that jurisdiction and to make the decisions of the court thereunder effective. The court, in aid
of its appellate jurisdiction, has authority to control all auxiliary and incidental matters necessary to the efficient and
proper exercise of that jurisdiction.1âwphi1 For this purpose, it may, when necessary, prohibit or restrain the
performance of any act which might interfere with the proper exercise of its rightful jurisdiction in cases pending before
it.
Lastly, it would not be amiss to point out that a court which is endowed with a particular jurisdiction should have powers
which are necessary to enable it to act effectively within such jurisdiction. These should be regarded as powers which are
inherent in its jurisdiction and the court must possess them in order to enforce its rules of practice and to suppress any
abuses of its process and to defeat any attempted thwarting of such process.
In this regard, Section 1 of RA 9282 states that the CTA shall be of the same level as the CA and shall possess all the
inherent powers of a court of justice.
Indeed, courts possess certain inherent powers which may be said to be implied from a general grant of jurisdiction, in
addition to those expressly conferred on them. These inherent powers are such powers as are necessary for the ordinary
and efficient exercise of jurisdiction; or are essential to the existence, dignity and functions of the courts, as well as to the
due administration of justice; or are directly appropriate, convenient and suitable to the execution of their granted
powers; and include the power to maintain the court's jurisdiction and render it effective in behalf of the litigants.
Thus, this Court has held that "while a court may be expressly granted the incidental powers necessary to effectuate its
jurisdiction, a grant of jurisdiction, in the absence of prohibitive legislation, implies the necessary and usual incidental
powers essential to effectuate it, and, subject to existing laws and constitutional provisions, every regularly constituted
court has power to do all things that are reasonably necessary for the administration of justice within the scope of its
jurisdiction and for the enforcement of its judgments and mandates." Hence, demands, matters or questions ancillary or
incidental to, or growing out of, the main action, and coming within the above principles, may be taken cognizance of by
the court and determined, since such jurisdiction is in aid of its authority over the principal matter, even though the court
may thus be called on to consider and decide matters which, as original causes of action, would not be within its
cognizance.
Based on the foregoing disquisitions, it can be reasonably concluded that the authority of the CTA to take cognizance of
petitions for certiorari questioning interlocutory orders issued by the RTC in a local tax case is included in the powers
granted by the Constitution as well as inherent in the exercise of its appellate jurisdiction.
Finally, it would bear to point out that this Court is not abandoning the rule that, insofar as quasi-judicial tribunals are
concerned, the authority to issue writs of certiorari must still be expressly conferred by the Constitution or by law and
cannot be implied from the mere existence of their appellate jurisdiction. This doctrine remains as it applies only to quasi-
judicial bodies.
WHEREFORE, the petition is DENIED.
SO ORDERED.
DIOSDA DO M. PERALTA
Associate Justice

6. NATURE:
This is a special civil action for certiorari under Rule 65 of the Rules of Court seeking to reverse and set aside the
Resolutions1 dated April 6, 2006 and November 29, 2006 of the Court of Appeals.
FACTS:
Petitioner City of Manila, through its treasurer, petitioner Liberty Toledo, assessed taxes for the taxable period from
January to December 2002 against the private respondents. In addition to the taxes purportedly due from private
respondents pursuant to Section 14, 15, 16, 17 of the Revised Revenue Code of Manila (RRCM), said assessment
covered the local business taxes. Private respondents were constrained to pay the P 19,316,458.77 assessment under
protest.
On January 24, 2004, private respondents filed before the RTC of Pasay City the complaint denominated as one for
“Refund or Recovery of Illegally and/or Erroneously–Collected Local Business Tax, Prohibition with Prayer to Issue TRO
and Writ of Preliminary Injunction
The RTC granted private respondents’ application for a writ of preliminary injunction.
Petitioners filed a Motion for Reconsideration4 but the RTC denied. Petitioners then filed a special civil action
for certiorari with the CA but the CA dismissed petitioners’ petition for certiorari holding that it has no jurisdiction over the
said petition. The CA ruled that since appellate jurisdiction over private respondents’ complaint for tax refund, which was
filed with the RTC, is vested in the Court of Tax Appeals (CTA), pursuant to its expanded jurisdiction under
Republic Act No. 9282 (RA 9282), it follows that a petition for certiorari seeking nullification of an interlocutory order
issued in the said case should, likewise, be filed with the CTA.
Petitioners filed a Motion for Reconsideration,7 but the CA denied it in its Resolution hence, this petition
ISSUE:
Whether or not the CTA has jurisdiction over a special civil action for certiorari assailing an interlocutory order issued by
the RTC in a local tax case.
HELD:
The CTA has jurisdiction over a special civil action for certiorari assailing an interlocutory order issued by the RTC in a
local tax case. In order for any appellate court to effectively exercise its appellate jurisdiction, it must have the authority
to issue, among others, a writ of certiorari. In transferring exclusive jurisdiction over appealed tax cases to the CTA, it can
reasonably be assumed that the law intended to transfer also such power as is deemed necessary, if not indispensable, in
aid of such appellate jurisdiction. There is no perceivable reason why the transfer should only be considered as partial,
not total.
Consistent with the above pronouncement, the Court has held as early as the case of J.M. Tuason & Co., Inc. v. Jaramillo,
et al. [118 Phil. 1022 (1963)] that “if a case may be appealed to a particular court or judicial tribunal or body, then said
court or judicial tribunal or body has jurisdiction to issue the extraordinary writ of certiorari, in aid of its appellate
jurisdiction.” This principle was affirmed in De Jesus v. Court of Appeals (G.R. No. 101630, August 24, 1992) where the
Court stated that “a court may issue a writ of certiorari in aid of its appellate jurisdiction if said court has jurisdiction to
review, by appeal or writ of error, the final orders or decisions of the lower court.
FALLO: petition is denied

7. G.R. No. 173946, June 19, 2013
BOSTON EQUITY RESOURCES, INC., Petitioner, v. COURT OF APPEALS AND LOLITA G. TOLEDO, Respondents.
D E C I S I O N
PEREZ, J.:
Before the Court is a Petition for Review on Certiorari seeking to reverse and set aside: (1) the Decision,1 dated 28
February 2006 and (2) the Resolution,2 dated 1 August 2006 of the Court of Appeals in CA-G.R. SP No. 88586. The
challenged decision granted herein respondent’s petition for certiorari upon a finding that the trial court committed grave
abuse of discretion in denying respondent’s motion to dismiss the complaint against her.3 Based on this finding, the Court
of Appeals reversed and set aside the Orders, dated 8 November 20044 and 22 December 2004,5 respectively, of the
Regional Trial Court (RTC) of Manila, Branch 24.
The Facts
On 24 December 1997, petitioner filed a complaint for sum of money with a prayer for the issuance of a writ of
preliminary attachment against the spouses Manuel and Lolita Toledo. Herein respondent filed an Answer dated 19 March
1998 but on 7 May 1998, she filed a Motion for Leave to Admit Amended Answer in which she alleged, among others,
that her husband and co-defendant, Manuel Toledo (Manuel), is already dead. The death certificate of Manuel states "13
July 1995" as the date of death. As a result, petitioner filed a motion, dated 5 August 1999, to require respondent to
disclose the heirs of Manuel. In compliance with the verbal order of the court during the 11 October 1999 hearing of the
case, respondent submitted the required names and addresses of the heirs. Petitioner then filed a Motion for Substitution,
dated 18 January 2000, praying that Manuel be substituted by his children as party-defendants. It appears that this
motion was granted by the trial court in an Order dated 9 October 2000.
Pre-trial thereafter ensued and on 18 July 2001, the trial court issued its pre-trial order containing, among others, the
dates of hearing of the case.
The trial of the case then proceeded. Herein petitioner, as plaintiff, presented its evidence and its exhibits were thereafter
admitted.
On 26 May 2004, the reception of evidence for herein respondent was cancelled upon agreement of the parties. On 24
September 2004, counsel for herein respondent was given a period of fifteen days within which to file a demurrer to
evidence. However, on 7 October 2004, respondent instead filed a motion to dismiss the complaint, citing the following as
grounds: (1) that the complaint failed to implead an indispensable party or a real party in interest; hence, the case must
be dismissed for failure to state a cause of action; (2) that the trial court did not acquire jurisdiction over the person of
Manuel pursuant to Section 5, Rule 86 of the Revised Rules of Court; (3) that the trial court erred in ordering the
substitution of the deceased Manuel by his heirs; and (4) that the court must also dismiss the case against Lolita Toledo
in accordance with Section 6, Rule 86 of the Rules of Court.
The trial court, in an Order dated 8 November 2004, denied the motion to dismiss for having been filed out of time, citing
Section 1, Rule 16 of the 1997 Rules of Court which states that: "[W]ithin the time for but before filing the answer to the
complaint or pleading asserting a claim, a motion to dismiss may be made x x x." Respondent’s motion for
reconsideration of the order of denial was likewise denied on the ground that "defendants’ attack on the jurisdiction of
this Court is now barred by estoppel by laches" since respondent failed to raise the issue despite several chances to do
so.
Aggrieved, respondent filed a petition for certiorari with the Court of Appeals alleging that the trial court seriously erred
and gravely abused its discretion in denying her motion to dismiss despite discovery, during the trial of the case, of
evidence that would constitute a ground for dismissal of the case.
The Court of Appeals granted the petition based on the following grounds:
It is elementary that courts acquire jurisdiction over the person of the defendant x x x only when the latter voluntarily
appeared or submitted to the court or by coercive process issued by the court to him, x x x. In this case, it is undisputed
that when [petitioner] Boston filed the complaint on December 24, 1997, defendant Manuel S. Toledo was already
dead, x x x. Such being the case, the court a quo could not have acquired jurisdiction over the person of defendant
Manuel S. Toledo.
x x x the court a quo’s denial of [respondent’s] motion to dismiss was based on its finding that [respondent’s] attack on
the jurisdiction of the court was already barred by laches as [respondent] failed to raise the said ground in its [sic]
amended answer and during the pre-trial, despite her active participation in the proceedings.
However, x x x it is well-settled that issue on jurisdiction may be raised at any stage of the proceeding, even for the first
time on appeal. By timely raising the issue on jurisdiction in her motion to dismiss x x x [respondent] is not estopped
[from] raising the question on jurisdiction. Moreover, when issue on jurisdiction was raised by [respondent], the court a
quo had not yet decided the case, hence, there is no basis for the court a quo to invoke estoppel to justify its denial of
the motion for reconsideration;
It should be stressed that when the complaint was filed, defendant Manuel S. Toledo was already dead. The complaint
should have impleaded the estate of Manuel S. Toledo as defendant, not only the wife, considering that the estate of
Manuel S. Toledo is an indispensable party, which stands to be benefited or be injured in the outcome of the case. x x x
x x x x

8. [Respondent’s] motion to dismiss the complaint should have been granted by public respondent judge as the same was in
order. Considering that the obligation of Manuel S. Toledo is solidary with another debtor, x x x, the claim x x x should be
filed against the estate of Manuel S. Toledo, in conformity with the provision of Section 6, Rule 86 of the Rules of Court, x
x x.
The Court of Appeals denied petitioner’s motion for reconsideration. Hence, this petition.
The Issues
Petitioner claims that the Court of Appeals erred in not holding that:
1. Respondent is already estopped from questioning the trial court’s jurisdiction;
2. Petitioner never failed to implead an indispensable party as the estate of Manuel is not an indispensable party;
3. The inclusion of Manuel as party-defendant is a mere misjoinder of party not warranting the dismissal of the case
before the lower court; and
4. Since the estate of Manuel is not an indispensable party, it is not necessary that petitioner file its claim against
the estate of Manuel.
In essence, what is at issue here is the correctness of the trial court’s orders denying respondent’s motion to dismiss.
The Ruling of the Court
We find merit in the petition.
Motion to dismiss filed out of time
To begin with, the Court of Appeals erred in granting the writ of certiorari in favor of respondent. Well settled is the rule
that the special civil action for certiorari is not the proper remedy to assail the denial by the trial court of a motion to
dismiss. The order of the trial court denying a motion to dismiss is merely interlocutory, as it neither terminates nor finally
disposes of a case and still leaves something to be done by the court before a case is finally decided on the merits.
Therefore, "the proper remedy in such a case is to appeal after a decision has been rendered."
As the Supreme Court held in Indiana Aerospace University v. Comm. on Higher Education:
A writ of certiorari is not intended to correct every controversial interlocutory ruling; it is resorted only to correct a grave
abuse of discretion or a whimsical exercise of judgment equivalent to lack of jurisdiction. Its function is limited to keeping
an inferior court within its jurisdiction and to relieve persons from arbitrary acts – acts which courts or judges have no
power or authority in law to perform. It is not designed to correct erroneous findings and conclusions made by
the courts.
Even assuming that certiorari is the proper remedy, the trial court did not commit grave abuse of discretion in denying
respondent’s motion to dismiss. It, in fact, acted correctly when it issued the questioned orders as respondent’s motion to
dismiss was filed SIX YEARS AND FIVE MONTHS AFTER SHE FILED HER AMENDED ANSWER. This circumstance alone
already warranted the outright dismissal of the motion for having been filed in clear contravention of the express
mandate of Section 1, Rule 16, of the Revised Rules of Court. Under this provision, a motion to dismiss shall be filed
within the time for but before the filing of an answer to the complaint or pleading asserting a claim.
More importantly, respondent’s motion to dismiss was filed after petitioner has completed the presentation of its evidence
in the trial court, giving credence to petitioner’s and the trial court’s conclusion that the filing of the motion to dismiss was
a mere ploy on the part of respondent to delay the prompt resolution of the case against her.
Also worth mentioning is the fact that respondent’s motion to dismiss under consideration herein is not the first motion to
dismiss she filed in the trial court. It appears that she had filed an earlier motion to dismiss on the sole ground of the
unenforceability of petitioner’s claim under the Statute of Frauds, which motion was denied by the trial court. More telling
is the following narration of the trial court in its Order denying respondent’s motion for reconsideration of the denial of
her motion to dismiss:
As can be gleaned from the records, with the admission of plaintiff’s exhibits, reception of defendants’ evidence was set
on March 31, and April 23, 2004 x x x . On motion of the defendant[s], the hearing on March 31, 2004 was cancelled.
On April 14, 2004, defendants sought the issuance of subpoena ad testificandum and duces tecum to one Gina M.
Madulid, to appear and testify for the defendants on April 23, 2004. Reception of defendants’ evidence was again
deferred to May 26, June 2 and June 30, 2004, x x x.
On May 13, 2004, defendants sought again the issuance of a subpoena duces tecum and ad testificandum to the said
Gina Madulid. On May 26, 2004, reception of defendants [sic] evidence was cancelled upon the agreement of the parties.
On July 28, 2004, in the absence of defendants’ witness, hearing was reset to September 24 and October 8, 2004 x x x.
On September 24, 2004, counsel for defendants was given a period of fifteen (15) days to file a demurrer to evidence. On
October 7, 2004, defendants filed instead a Motion to Dismiss x x x.

9. Respondent’s act of filing multiple motions, such as the first and earlier motion to dismiss and then the motion to dismiss
at issue here, as well as several motions for postponement, lends credibility to the position taken by petitioner, which is
shared by the trial court, that respondent is deliberately impeding the early disposition of this case. The filing of the
second motion to dismiss was, therefore, "not only improper but also dilatory." Thus, the trial court, "far from deviating or
straying off course from established jurisprudence on [the] matter, x x x had in fact faithfully observed the law and legal
precedents in this case." The Court of Appeals, therefore, erred not only in entertaining respondent’s petition for
certiorari, it likewise erred in ruling that the trial court committed grave abuse of discretion when it denied respondent’s
motion to dismiss.
On whether or not respondent is estopped from
questioning the jurisdiction of the trial court
At the outset, it must be here stated that, as the succeeding discussions will demonstrate, jurisdiction over the person of
Manuel should not be an issue in this case. A protracted discourse on jurisdiction is, nevertheless, demanded by the fact
that jurisdiction has been raised as an issue from the lower court, to the Court of Appeals and, finally, before this Court.
For the sake of clarity, and in order to finally settle the controversy and fully dispose of all the issues in this case, it was
deemed imperative to resolve the issue of jurisdiction.
1. Aspects of Jurisdiction
Petitioner calls attention to the fact that respondent’s motion to dismiss questioning the trial court’s jurisdiction was filed
more than six years after her amended answer was filed. According to petitioner, respondent had several opportunities,
at various stages of the proceedings, to assail the trial court’s jurisdiction but never did so for six straight years. Citing
the doctrine laid down in the case of Tijam, et al. v. Sibonghanoy, et al. petitioner claimed that respondent’s failure to
raise the question of jurisdiction at an earlier stage bars her from later questioning it, especially since she actively
participated in the proceedings conducted by the trial court.
Petitioner’s argument is misplaced, in that, it failed to consider that the concept of jurisdiction has several aspects,
namely: (1) jurisdiction over the subject matter; (2) jurisdiction over the parties; (3) jurisdiction over the issues of the
case; and (4) in cases involving property, jurisdiction over the res or the thing which is the subject of the litigation.
The aspect of jurisdiction which may be barred from being assailed as a result of estoppel by laches is jurisdiction over
the subject matter. Thus, in Tijam, the case relied upon by petitioner, the issue involved was the authority of the then
Court of First Instance to hear a case for the collection of a sum of money in the amount of P1,908.00 which amount
was, at that time, within the exclusive original jurisdiction of the municipal courts.
In subsequent cases citing the ruling of the Court in Tijam, what was likewise at issue was the jurisdiction of the trial
court over the subject matter of the case. Accordingly, in Spouses Gonzaga v. Court of Appeals, the issue for
consideration was the authority of the regional trial court to hear and decide an action for reformation of contract and
damages involving a subdivision lot, it being argued therein that jurisdiction is vested in the Housing and Land Use
Regulatory Board pursuant to PD 957 (The Subdivision and Condominium Buyers Protective Decree). In Lee v. Presiding
Judge, MTC, Legaspi City, petitioners argued that the respondent municipal trial court had no jurisdiction over the
complaint for ejectment because the issue of ownership was raised in the pleadings. Finally, in People v. Casuga,34
accused-appellant claimed that the crime of grave slander, of which she was charged, falls within the concurrent
jurisdiction of municipal courts or city courts and the then courts of first instance, and that the judgment of the court of
first instance, to which she had appealed the municipal court's conviction, should be deemed null and void for want of
jurisdiction as her appeal should have been filed with the Court of Appeals or the Supreme Court.
In all of these cases, the Supreme Court barred the attack on the jurisdiction of the respective courts concerned over the
subject matter of the case based on estoppel by laches, declaring that parties cannot be allowed to belatedly adopt an
inconsistent posture by attacking the jurisdiction of a court to which they submitted their cause voluntarily.35
Here, what respondent was questioning in her motion to dismiss before the trial court was that court’s jurisdiction over
the person of defendant Manuel. Thus, the principle of estoppel by laches finds no application in this case. Instead, the
principles relating to jurisdiction over the person of the parties are pertinent herein.
The Rules of Court provide:
RULE 9
EFFECT OF FAILURE TO PLEAD
Section 1. Defenses and objections not pleaded. — Defenses and objections not pleaded either in a motion to dismiss or
in the answer are deemed waived. However, when it appears from the pleadings or the evidence on record that the court
has no jurisdiction over the subject matter, that there is another action pending between the same parties for the same
cause, or that the action is barred by a prior judgment or by statute of limitations, the court shall dismiss the claim.
RULE 15
MOTIONS
Sec. 8. Omnibus motion. — Subject to the provisions of Section 1 of Rule 9, a motion attacking a pleading, order,
judgment, or proceeding shall include all objections then available, and all objections not so included shall be deemed
waived.
Based on the foregoing provisions, the "objection on jurisdictional grounds which is not waived even if not alleged in a
motion to dismiss or the answer is lack of jurisdiction over the subject matter. x x x Lack of jurisdiction over the subject

10. matter can always be raised anytime, even for the first time on appeal, since jurisdictional issues cannot be waived x x x
subject, however, to the principle of estoppel by laches."
Since the defense of lack of jurisdiction over the person of a party to a case is not one of those defenses which are not
deemed waived under Section 1 of Rule 9, such defense must be invoked when an answer or a motion to dismiss is filed
in order to prevent a waiver of the defense. If the objection is not raised either in a motion to dismiss or in the answer,
the objection to the jurisdiction over the person of the plaintiff or the defendant is deemed waived by virtue of the first
sentence of the above-quoted Section 1 of Rule 9 of the Rules of Court.
The Court of Appeals, therefore, erred when it made a sweeping pronouncement in its questioned decision, stating that
"issue on jurisdiction may be raised at any stage of the proceeding, even for the first time on appeal" and that, therefore,
respondent timely raised the issue in her motion to dismiss and is, consequently, not estopped from raising the question
of jurisdiction. As the question of jurisdiction involved here is that over the person of the defendant Manuel, the same is
deemed waived if not raised in the answer or a motion to dismiss. In any case, respondent cannot claim the defense
since "lack of jurisdiction over the person, being subject to waiver, is a personal defense which can only be asserted by
the party who can thereby waive it by silence."
2. Jurisdiction over the person of a defendant is acquired through a valid service of summons; trial
court did not acquire jurisdiction over the person of Manuel Toledo
In the first place, jurisdiction over the person of Manuel was never acquired by the trial court. A defendant is informed of
a case against him when he receives summons. "Summons is a writ by which the defendant is notified of the action
brought against him. Service of such writ is the means by which the court acquires jurisdiction over his person."
In the case at bar, the trial court did not acquire jurisdiction over the person of Manuel since there was no valid service of
summons upon him, precisely because he was already dead even before the complaint against him and his wife was filed
in the trial court. The issues presented in this case are similar to those in the case of Sarsaba v. Vda. de Te.
In Sarsaba, the NLRC rendered a decision declaring that Patricio Sereno was illegally dismissed from employment and
ordering the payment of his monetary claims. To satisfy the claim, a truck in the possession of Sereno’s employer was
levied upon by a sheriff of the NLRC, accompanied by Sereno and his lawyer, Rogelio Sarsaba, the petitioner in that case.
A complaint for recovery of motor vehicle and damages, with prayer for the delivery of the truck pendente lite was
eventually filed against Sarsaba, Sereno, the NLRC sheriff and the NLRC by the registered owner of the truck. After his
motion to dismiss was denied by the trial court, petitioner Sarsaba filed his answer. Later on, however, he filed an
omnibus motion to dismiss citing, as one of the grounds, lack of jurisdiction over one of the principal defendants, in view
of the fact that Sereno was already dead when the complaint for recovery of possession was filed.
Although the factual milieu of the present case is not exactly similar to that of Sarsaba, one of the issues submitted for
resolution in both cases is similar: whether or not a case, where one of the named defendants was already dead at the
time of its filing, should be dismissed so that the claim may be pursued instead in the proceedings for the settlement of
the estate of the deceased defendant. The petitioner in the Sarsaba Case claimed, as did respondent herein, that since
one of the defendants died before summons was served on him, the trial court should have dismissed the complaint
against all the defendants and the claim should be filed against the estate of the deceased defendant. The petitioner in
Sarsaba, therefore, prayed that the complaint be dismissed, not only against Sereno, but as to all the defendants,
considering that the RTC did not acquire jurisdiction over the person of Sereno. This is exactly the same prayer made by
respondent herein in her motion to dismiss.
The Court, in the Sarsaba Case, resolved the issue in this wise:
x x x We cannot countenance petitioner’s argument that the complaint against the other defendants should have been
dismissed, considering that the RTC never acquired jurisdiction over the person of Sereno. The court’s failure to
acquire jurisdiction over one’s person is a defense which is personal to the person claiming it. Obviously, it is
now impossible for Sereno to invoke the same in view of his death. Neither can petitioner invoke such ground, on
behalf of Sereno, so as to reap the benefit of having the case dismissed against all of the defendants. Failure
to serve summons on Sereno’s person will not be a cause for the dismissal of the complaint against the other defendants,
considering that they have been served with copies of the summons and complaints and have long submitted their
respective responsive pleadings. In fact, the other defendants in the complaint were given the chance to raise all possible
defenses and objections personal to them in their respective motions to dismiss and their subsequent answers.
Hence, the Supreme Court affirmed the dismissal by the trial court of the complaint against Sereno only.
Based on the foregoing pronouncements, there is no basis for dismissing the complaint against respondent herein. Thus,
as already emphasized above, the trial court correctly denied her motion to dismiss.
On whether or not the estate of Manuel
Toledo is an indispensable party
Rule 3, Section 7 of the 1997 Rules of Court states:
SEC. 7. Compulsory joinder of indispensable parties. — Parties-in-interest without whom no final determination can be
had of an action shall be joined either as plaintiffs or defendants.
An indispensable party is one who has such an interest in the controversy or subject matter of a case that a final
adjudication cannot be made in his or her absence, without injuring or affecting that interest. He or she is a party who
has not only an interest in the subject matter of the controversy, but "an interest of such nature that a final decree
cannot be made without affecting [that] interest or leaving the controversy in such a condition that its final determination
may be wholly inconsistent with equity and good conscience. It has also been considered that an indispensable party is a
person in whose absence there cannot be a determination between the parties already before the court which is effective,

11. complete or equitable." Further, an indispensable party is one who must be included in an action before it may properly
proceed.
On the other hand, a "person is not an indispensable party if his interest in the controversy or subject matter is separable
from the interest of the other parties, so that it will not necessarily be directly or injuriously affected by a decree which
does complete justice between them. Also, a person is not an indispensable party if his presence would merely permit
complete relief between him or her and those already parties to the action, or if he or she has no interest in the subject
matter of the action." It is not a sufficient reason to declare a person to be an indispensable party simply because his or
her presence will avoid multiple litigations.
Applying the foregoing pronouncements to the case at bar, it is clear that the estate of Manuel is not an indispensable
party to the collection case, for the simple reason that the obligation of Manuel and his wife, respondent herein, is
solidary.
The contract between petitioner, on the one hand and respondent and respondent’s husband, on the other, states:
FOR VALUE RECEIVED, I/We jointly and severally (in solemn) promise to pay BOSTON EQUITY RESOURCES, INC. x x
x the sum of PESOS: [ONE MILLION FOUR HUNDRED (P1,400,000.00)] x x x.47
The provisions and stipulations of the contract were then followed by the respective signatures of respondent as "MAKER"
and her husband as "CO-MAKER."48 Thus, pursuant to Article 1216 of the Civil Code, petitioner may collect the entire
amount of the obligation from respondent only. The aforementioned provision states: "The creditor may proceed against
any one of the solidary debtors or some or all of them simultaneously. The demand made against one of them shall not
be an obstacle to those which may subsequently be directed against the others, so long as the debt has not been fully
collected."
In other words, the collection case can proceed and the demands of petitioner can be satisfied by respondent only, even
without impleading the estate of Manuel. Consequently, the estate of Manuel is not an indispensable party to petitioner’s
complaint for sum of money.
However, the Court of Appeals, agreeing with the contention of respondent, held that the claim of petitioner should have
been filed against the estate of Manuel in accordance with Sections 5 and 6 of Rule 86 of the Rules of Court. The
aforementioned provisions provide:
SEC. 5. Claims which must be filed under the notice. If not filed, barred; exceptions. All claims for money against the
decedent, arising from contract, express or implied, whether the same be due, not due, or contingent, all claims for
funeral expenses and judgment for money against the decedent, must be filed within the time limited in the notice;
otherwise, they are barred forever, except that they may be set forth as counterclaims in any action that the executor or
administrator may bring against the claimants. x x x.
SEC. 6. Solidary obligation of decedent. Where the obligation of the decedent is solidary with another debtor, the claim
shall be filed against the decedent as if he were the only debtor, without prejudice to the right of the estate to recover
contribution from the other debtor. x x x.
The Court of Appeals erred in its interpretation of the above-quoted provisions.
In construing Section 6, Rule 87 of the old Rules of Court, the precursor of Section 6, Rule 86 of the Revised Rules of
Court, which latter provision has been retained in the present Rules of Court without any revisions, the Supreme Court, in
the case of Manila Surety & Fidelity Co., Inc. v. Villarama, et. al., held:
Construing Section 698 of the Code of Civil Procedure from whence [Section 6, Rule 87] was taken, this Court held that
where two persons are bound in solidum for the same debt and one of them dies, the whole indebtedness can be proved
against the estate of the latter, the decedent’s liability being absolute and primary; x x x. It is evident from the foregoing
that Section 6 of Rule 87 provides the procedure should the creditor desire to go against the deceased debtor, but there
is certainly nothing in the said provision making compliance with such procedure a condition precedent before an ordinary
action against the surviving solidary debtors, should the creditor choose to demand payment from the latter, could be
entertained to the extent that failure to observe the same would deprive the court jurisdiction to take cognizance of the
action against the surviving debtors. Upon the other hand, the Civil Code expressly allows the creditor to proceed against
any one of the solidary debtors or some or all of them simultaneously. There is, therefore, nothing improper in the
creditor’s filing of an action against the surviving solidary debtors alone, instead of instituting a proceeding for the
settlement of the estate of the deceased debtor wherein his claim could be filed.
The foregoing ruling was reiterated and expounded in the later case of Philippine National Bank v. Asuncion where the
Supreme Court pronounced:
A cursory perusal of Section 6, Rule 86 of the Revised Rules of Court reveals that nothing therein prevents a creditor from
proceeding against the surviving solidary debtors. Said provision merely sets up the procedure in enforcing collection in
case a creditor chooses to pursue his claim against the estate of the deceased solidary debtor. The rule has been set
forth that a creditor (in a solidary obligation) has the option whether to file or not to file a claim against the estate of the
solidary debtor. x x x
x x x x
It is crystal clear that Article 1216 of the New Civil Code is the applicable provision in this matter. Said
provision gives the creditor the right to "proceed against anyone of the solidary debtors or some or all of
them simultaneously." The choice is undoubtedly left to the solidary creditor to determine against whom
he will enforce collection. In case of the death of one of the solidary debtors, he (the creditor) may, if he so

12. chooses, proceed against the surviving solidary debtors without necessity of filing a claim in the estate of
the deceased debtors. It is not mandatory for him to have the case dismissed as against the surviving
debtors and file its claim against the estate of the deceased solidary debtor, x x x. For to require the creditor to
proceed against the estate, making it a condition precedent for any collection action against the surviving debtors to
prosper, would deprive him of his substantive rights provided by Article 1216 of the New Civil Code.
As correctly argued by petitioner, if Section 6, Rule 86 of the Revised Rules of Court were applied literally, Article 1216 of
the New Civil Code would, in effect, be repealed since under the Rules of Court, petitioner has no choice but to proceed
against the estate of [the deceased debtor] only. Obviously, this provision diminishes the [creditor’s] right under the New
Civil Code to proceed against any one, some or all of the solidary debtors. Such a construction is not sanctioned by
principle, which is too well settled to require citation, that a substantive law cannot be amended by a procedural rule.
Otherwise stated, Section 6, Rule 86 of the Revised Rules of Court cannot be made to prevail over Article 1216 of the
New Civil Code, the former being merely procedural, while the latter, substantive.
Based on the foregoing, the estate of Manuel is not an indispensable party and the case can proceed as against
respondent only. That petitioner opted to collect from respondent and not from the estate of Manuel is evidenced by its
opposition to respondent’s motion to dismiss asserting that the case, as against her, should be dismissed so that
petitioner can proceed against the estate of Manuel.
On whether or not the inclusion of Manuel as
party defendant is a misjoinder of party
Section 11 of Rule 3 of the Rules of Court states that "[n]either misjoinder nor non-joinder of parties is ground for
dismissal of an action. Parties may be dropped or added by order of the court on motion of any party or on its own
initiative at any stage of the action and on such terms as are just. Any claim against a misjoined party may be severed
and proceeded with separately."
Based on the last sentence of the afore-quoted provision of law, a misjoined party must have the capacity to sue or be
sued in the event that the claim by or against the misjoined party is pursued in a separate case. In this case, therefore,
the inclusion of Manuel in the complaint cannot be considered a misjoinder, as in fact, the action would have proceeded
against him had he been alive at the time the collection case was filed by petitioner. This being the case, the remedy
provided by Section 11 of Rule 3 does not obtain here. The name of Manuel as party-defendant cannot simply be dropped
from the case. Instead, the procedure taken by the Court in Sarsaba v. Vda. de Te,52 whose facts, as mentioned earlier,
resemble those of this case, should be followed herein. There, the Supreme Court agreed with the trial court when it
resolved the issue of jurisdiction over the person of the deceased Sereno in this wise:
As correctly pointed by defendants, the Honorable Court has not acquired jurisdiction over the person of Patricio Sereno
since there was indeed no valid service of summons insofar as Patricio Sereno is concerned. Patricio Sereno died before
the summons, together with a copy of the complaint and its annexes, could be served upon him.
However, the failure to effect service of summons unto Patricio Sereno, one of the defendants herein, does not render
the action DISMISSIBLE, considering that the three (3) other defendants, x x x, were validly served with summons and
the case with respect to the answering defendants may still proceed independently. Be it recalled that the three (3)
answering defendants have previously filed a Motion to Dismiss the Complaint which was denied by the Court.
Hence, only the case against Patricio Sereno will be DISMISSED and the same may be filed as a claim against
the estate of Patricio Sereno, but the case with respect to the three (3) other accused [sic] will proceed.
As a result, the case, as against Manuel, must be dismissed.
In addition, the dismissal of the case against Manuel is further warranted by Section 1 of Rule 3 of the Rules of Court,
which states that: [o]nly natural or juridical persons, or entities authorized by law may be parties in a civil action."
Applying this provision of law, the Court, in the case of Ventura v. Militante, held:
Parties may be either plaintiffs or defendants. x x x. In order to maintain an action in a court of justice, the plaintiff must
have an actual legal existence, that is, he, she or it must be a person in law and possessed of a legal entity as either a
natural or an artificial person, and no suit can be lawfully prosecuted save in the name of such a person.
The rule is no different as regards party defendants. It is incumbent upon a plaintiff, when he institutes a judicial
proceeding, to name the proper party defendant to his cause of action. In a suit or proceeding in personam of an
adversary character, the court can acquire no jurisdiction for the purpose of trial or judgment until a party defendant who
actually or legally exists and is legally capable of being sued, is brought before it. It has even been held that the question
of the legal personality of a party defendant is a question of substance going to the jurisdiction of the court and not one
of procedure.
The original complaint of petitioner named the "estate of Carlos Ngo as represented by surviving spouse Ms. Sulpicia
Ventura" as the defendant. Petitioner moved to dismiss the same on the ground that the defendant as named in the
complaint had no legal personality. We agree.
x x x. Considering that capacity to be sued is a correlative of the capacity to sue, to the same extent, a decedent does
not have the capacity to be sued and may not be named a party defendant in a court action.
Indeed, where the defendant is neither a natural nor a juridical person or an entity authorized by law, the complaint may
be dismissed on the ground that the pleading asserting the claim states no cause of action or for failure to state a cause

13. of action pursuant to Section 1(g) of Rule 16 of the Rules of Court, because a complaint cannot possibly state a cause of
action against one who cannot be a party to a civil action.
Since the proper course of action against the wrongful inclusion of Manuel as party-defendant is the dismissal of the case
as against him, thus did the trial court err when it ordered the substitution of Manuel by his heirs. Substitution is proper
only where the party to be substituted died during the pendency of the case, as expressly provided for by Section 16,
Rule 3 of the Rules of Court, which states:
Death of party;duty of counsel. — Whenever a party to a pending action dies, and the claim is not thereby
extinguished, it shall be the duty of his counsel to inform the court within thirty (30) days after such death of the fact
thereof, and to give the name and address of his legal representative or representatives. x x x
The heirs of the deceased may be allowed to be substituted for the deceased, without requiring the appointment of an
executor or administrator x x x.
The court shall forthwith order said legal representative or representatives to appear and be substituted within a period of
thirty (30) days from notice.
Here, since Manuel was already dead at the time of the filing of the complaint, the court never acquired jurisdiction over
his person and, in effect, there was no party to be substituted.
WHEREFORE, the petition is GRANTED. The Decision dated 28 February 2006 and the Resolution dated 1 August 2006
of the Court of Appeals in CA-G.R. SP No. 88586 are REVERSED and SET ASIDE. The Orders of the Regional Trial
Court dated 8 November 2004 and 22 December 2004, respectively, in Civil Case No. 97-86672, are REINSTATED. The
Regional Trial Court, Branch 24, Manila is hereby DIRECTED to proceed with the trial of Civil Case No. 97-86672 against
respondent Lolita G. Toledo only, in accordance with the above pronouncements of the Court, and to decide the case with
dispatch.
SO ORDERED. Carpio, (Chairperson), Brion, Del Castillo, and Villarama, Jr.,* JJ., concur.

14. (Estopple)
G.R. No. 198755 June 5, 2013
ALBERTO PAT-OG, SR., Petitioner, vs.
CIVIL SERVICE COMMISSION, Respondent.
D E C I S I O N
MENDOZA, J.:
Before this Court is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, which seeks to set aside the
April 6, 2011 Decision1 of the Court of Appeals (CA) in CA-G.R. SP No. 101700, affirming the April 11, 2007 Decision2 of
the Civil Service Commission (CSC), which ordered the dismissal of petitioner Alberto Pat-og, Sr. (Pat-og) from the service
for grave misconduct.
The Facts
On September 13, 2003, Robert Bang-on (Bang-on), then a 14-year old second year high school student of the Antadao
National High School in Sagada, Mountain Province, tiled an affidavit-complaint against Pat-og, a third year high school
teacher of the same school, before the Civil Service Commission-Cordillera Administrative Region (CSC-CAR).
Bang-on alleged that on the morning of August 26, 2003, he attended his class at the basketball court of the school,
where Pat-og and his third year students were also holding a separate class; that he and some of his classmates joined
Pat-og’s third year students who were practicing basketball shots; that Pat-og later instructed them to form two lines;
that thinking that three lines were to be formed, he stayed in between the two lines; that Pat-og then held his right arm
and punched his stomach without warning for failing to follow instructions; and that as a result, he suffered stomach pain
for several days and was confined in a hospital from September 10-12, 2003, as evidenced by a medico-legal certificate,
which stated that he sustained a contusion hematoma in the hypogastric area.
Regarding the same incident, Bang-on filed a criminal case against Pat-og for the crime of Less Serious Physical Injury
with the Regional Trial Court (RTC) of Bontoc, Mountain Province.
Taking cognizance of the administrative case, the CSC-CAR directed Pat-og to file his counter-affidavit. He denied the
charges hurled against him and claimed that when he was conducting his Music, Arts, Physical Education and Health
(MAPEH) class, composed of third year students, he instructed the girls to play volleyball and the boys to play basketball;
that he later directed the boys to form two lines; that after the boys failed to follow his repeated instructions, he scolded
them in a loud voice and wrested the ball from them; that while approaching them, he noticed that there were male
students who were not members of his class who had joined the shooting practice; that one of those male students was
Bang-on, who was supposed to be having his own MAPEH class under another teacher; that he then glared at them,
continued scolding them and dismissed the class for their failure to follow instructions; and that he offered the sworn
statement of other students to prove that he did not box Bang-on.
On June 1, 2004, the CSC-CAR found the existence of a prima faciecase for misconduct and formally charged Pat-og.
While the proceedings of the administrative case were ongoing, the RTC rendered its judgment in the criminal case and
found Pat-og guilty of the offense of slight physical injury. He was meted the penalty of imprisonment from eleven (11) to
twenty (20) days. Following his application for probation, the decision became final and executory and judgment was
entered.
Meanwhile, in the administrative case, a pre-hearing conference was conducted after repeated postponement by Pat-og.
With the approval of the CSC-CAR, the prosecution submitted its position paper in lieu of a formal presentation of
evidence and formally offered its evidence, which included the decision in the criminal case. It offered the affidavits of
Raymund Atuban, a classmate of Bang-on; and James Domanog, a third year high school student, who both witnessed
Pat-og hit Bang-on in the stomach.
For his defense, Pat-og offered the testimonies of his witnesses - Emiliano Dontongan (Dontongan), a teacher in another
school, who alleged that he was a member of the Municipal Council for the Protection of Children, and that, in such
capacity, he investigated the incident and came to the conclusion that it did not happen at all; and Ernest Kimmot, who
testified that he was in the basketball court at the time but did not see such incident. Pat-og also presented the affidavits
of thirteen other witnesses to prove that he did not punch Bang-on.
Ruling of the CSC-CAR
In its Decision,3 dated September 19, 2006, the CSC-CAR found Pat-og guilty and disposed as follows:
WHEREFORE, all premises told, respondent Alberto Pat-og, Sr., Teacher Antadao National High School, is hereby found
guilty of Simple Misconduct.
Under the Uniform Rules on Administrative Cases in the Civil Service, the imposable penalty on the first offense of Simple
Misconduct is suspension of one (1) month and one (1) day to six (6) months.
Due to seriousness of the resulting injury to the fragile body of the minor victim, the CSC-CAR hereby imposed upon
respondent the maximum penalty attached to the offense which is six months suspension without pay.

15. The CSC-CAR gave greater weight to the version posited by the prosecution, finding that a blow was indeed inflicted by
Pat-og on Bang-on. It found that Pat-og had a motive for doing so - his students’ failure to follow his repeated
instructions which angered him. Nevertheless, the CSCCAR ruled that a motive was not necessary to establish guilt if the
perpetrator of the offense was positively identified. The positive identification of Pat-og was duly proven by the
corroborative testimonies of the prosecution witnesses, who were found to be credible and disinterested. The testimony
of defense witness, Dontongan, was not given credence considering that the students he interviewed for his investigation
claimed that Pat-og was not even angry at the time of the incident, contrary to the latter’s own admission.
The CSC-CAR held that the actions of Pat-og clearly transgressed the proper norms of conduct required of a public
official, and the gravity of the offense was further magnified by the seriousness of the injury of Bang-on which required a
healing period of more than ten (10) days. It pointed out that, being his teacher, Pat-og’s substitute parental authority
did not give him license to physically chastise a misbehaving student. The CSC-CAR added that the fact that Pat-og
applied for probation in the criminal case, instead of filing an appeal, further convinced it of his guilt.
The CSC-CAR believed that the act committed by Pat-og was sufficient to find him guilty of Grave Misconduct. It,
however, found the corresponding penalty of dismissal from the service too harsh under the circumstances. Thus, it
adjudged petitioner guilty of Simple Misconduct and imposed the maximum penalty of suspension for six (6) months.
On December 11, 2006, the motion for reconsideration filed by Pat-og was denied for lack of merit.4
The Ruling of the CSC
In its Resolution,5 dated April 11, 2007, the CSC dismissed Pat-og’s appeal and affirmed with modification the decision of
the CSC-CAR as follows:
WHEREFORE, foregoing premises considered, the instant appeal is hereby DISMISSED. The decision of the CSC-CAR is
affirmed with the modification that Alberto Pat-og, Sr., is adjudged guilty of grave misconduct, for which he is meted out
the penalty of dismissal from the service with all its accessory penalties of cancellation of eligibilities, perpetual
disqualification from reemployment in the government service, and forfeiture of retirement benefits.6
After evaluating the records, the CSC sustained the CSC-CAR’s conclusion that there existed substantial evidence to
sustain the finding that Pat-og did punch Bang-on in the stomach. It gave greater weight to the positive statements of
Bang-on and his witnesses over the bare denial of Patog. It also highlighted the fact that Pat-og failed to adduce evidence
of any ill motive on the part of Bang-on in filing the administrative case against him. It likewise gave credence to the
medico-legal certificate showing that Bang-on suffered a hematoma contusion in his hypogastric area.
The CSC ruled that the affidavits of Bang-on’s witnesses were not bereft of evidentiary value even if Pat-og was not
afforded a chance to cross-examine the witnesses of Bang-on. It is of no moment because the cross- examination of
witnesses is not an indispensable requirement of administrative due process.
The CSC noted that Pat-og did not question but, instead, fully acquiesced in his conviction in the criminal case for slight
physical injury, which was based on the same set of facts and circumstances, and involved the same parties and issues.
It, thus, considered his prior criminal conviction as evidence against him in the administrative case.
Finding that his act of punching his student displayed a flagrant and wanton disregard of the dignity of a person,
reminiscent of corporal punishment that had since been outlawed for being harsh, unjust, and cruel, the CSC upgraded
Pat-og’s offense from Simple Misconduct to Grave Misconduct and ordered his dismissal from the service.
Pat-og filed a motion for reconsideration, questioning for the first time the jurisdiction of CSC over the case. He
contended that administrative charges against a public school teacher should have been initially heard by a committee to
be constituted pursuant to the Magna Carta for Public School Teachers.
On November 5, 2007, the CSC denied his motion for reconsideration.7 It ruled that Pat-og was estopped from
challenging its jurisdiction considering that he actively participated in the administrative proceedings against him, raising
the issue of jurisdiction only after his appeal was dismissed by the CSC.
Ruling of the Court of Appeals
In its assailed April 6, 2011 Decision,8 the CA affirmed the resolutions of the CSC. It agreed that Pat-og was estopped
from questioning the jurisdiction of the CSC as the records clearly showed that he actively participated in the proceedings.
It was of the view that Pat-og was not denied due process when he failed to cross-examine Bang-on and his witnesses
because he was given the opportunity to be heard and present his evidence before the CSC-CAR and the CSC.
The CA also held that the CSC committed no error in taking into account the conviction of Pat-og in the criminal case. It
stated that his conviction was not the sole basis of the CSC for his dismissal from the service because there was
substantial evidence proving that Pat-og had indeed hit Bang-on.
In its assailed Resolution,9 dated September 13, 2011, the CA denied the motion for reconsideration filed by Pat-og.
Hence, the present petition with the following
Assignment of Errors

16. WHETHER OR NOT RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION WHEN IT AFFIRMED
THE SUPREME PENALTY OF DISMISSAL FROM SERVICE WITH FORFEITURE OF RETIREMENT BENEFITS AGAINST THE
PETITIONER WITHOUT CONSIDERING PETITIONER’S LONG YEARS OF GOVERNMENT SERVICE?
WHETHER OR NOT RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION WHEN IT RULED
THAT PETITIONER IS ESTOPPED FROM QUESTIONING THE JURISDICTION OF THE CIVIL SERVICE COMMISSION TO
HEAR AND DECIDE THE ADMINISTRATIVE CASE AGAINST HIM?
WHETHER OR NOT RESPONDENT COURT OF APPEALS SERIOUSLY ERRED AND COMMITTED GRAVE ABUSE OF
DISCRETION IN DISMISSING THE APPEAL DESPITE LACK OF SUBSTANTIAL EVIDENCE?
On Jurisdiction
Pat-og contends that Section 9 of Republic Act (R.A.) No. 4670, otherwise known as the Magna Carta for Public School
Teachers, provides that administrative charges against a public school teacher shall be heard initially by a committee
constituted under said section. As no committee was ever formed, the petitioner posits that he was denied due process
and that the CSC did not have the jurisdiction to hear and decide his administrative case. He further argues that
notwithstanding the fact that the issue of jurisdiction was raised for the first time on appeal, the rule remains that
estoppel does not confer jurisdiction on a tribunal that has no jurisdiction over the cause of action or subject matter of
the case.
The Court cannot sustain his position.
The petitioner’s argument that the administrative case against him can only proceed under R.A. No. 4670 is misplaced.
In Puse v. Santos-Puse,10 it was held that the CSC, the Department of Education (DepEd) and the Board of Professional
Teachers-Professional Regulatory Commission (PRC) have concurrent jurisdiction over administrative cases against public
school teachers.
Under Article IX-B of the 1987 Constitution, the CSC is the body charged with the establishment and administration of a
career civil service which embraces all branches and agencies of the government.11 Executive Order (E.O.) No. 292 (the
Administrative Code of 1987)12 and Presidential Decree (P.D.) No. 807 (the Civil Service Decree of the Philippines)13
expressly provide that the CSC has the power to hear and decide administrative disciplinary cases instituted with it or
brought to it on appeal. Thus, the CSC, as the central personnel agency of the government, has the inherent power to
supervise and discipline all members of the civil service, including public school teachers.
Indeed, under Section 9 of R.A. No. 4670, the jurisdiction over administrative cases of public school teachers is lodged
with the investigating committee constituted therein.14 Also, under Section 23 of R.A. No. 7836 (the Philippine Teachers
Professionalization Act of 1994), the Board of Professional Teachers is given the power, after due notice and hearing, to
suspend or revoke the certificate of registration of a professional teacher for causes enumerated therein.15
Concurrent jurisdiction is that which is possessed over the same parties or subject matter at the same time by two or
more separate tribunals. When the law bestows upon a government body the jurisdiction to hear and decide cases
involving specific matters, it is to be presumed that such jurisdiction is exclusive unless it be proved that another body is
likewise vested with the same jurisdiction, in which case, both bodies have concurrent jurisdiction over the matter.16
Where concurrent jurisdiction exists in several tribunals, the body that first takes cognizance of the complaint shall
exercise jurisdiction to the exclusion of the others. In this case, it was CSC which first acquired jurisdiction over the case
because the complaint was filed before it. Thus, it had the authority to proceed and decide the case to the exclusion of
the DepEd and the Board of Professional Teachers.17
In CSC v. Alfonso,18 it was held that special laws, such as R.A. No. 4670, do not divest the CSC of its inherent power to
supervise and discipline all members of the civil service, including public school teachers. Pat-og, as a public school
teacher, is first and foremost, a civil servant accountable to the people and answerable to the CSC for complaints lodged
against him as a public servant. To hold that R.A. No. 4670 divests the CSC of its power to discipline public school
teachers would negate the very purpose for which the CSC was established and would impliedly amend the Constitution
itself.
To further drive home the point, it was ruled in CSC v. Macud19 that R.A. No. 4670, in imposing a separate set of
procedural requirements in connection with administrative proceedings against public school teachers, should be
construed to refer only to the specific procedure to be followed in administrative investigations conducted by the DepEd.
By no means, then, did R.A. No. 4670 confer an exclusive disciplinary authority over public school teachers on the DepEd.
At any rate, granting that the CSC was without jurisdiction, the petitioner is indeed estopped from raising the issue.
Although the rule states that a jurisdictional question may be raised at any time, such rule admits of the exception where,
as in this case, estoppel has supervened.20 Here, instead of opposing the CSC’s exercise of jurisdiction, the petitioner
invoked the same by actively participating in the proceedings before the CSC-CAR and by even filing his appeal before the
CSC itself; only raising the issue of jurisdiction later in his motion for reconsideration after the CSC denied his appeal. This
Court has time and again frowned upon the undesirable practice of a party submitting his case for decision and then
accepting the judgment only if favorable, but attacking it for lack of jurisdiction when adverse.21

17. On Administrative Due Process
On due process, Pat-og asserts that the affidavits of the complainant and his witnesses are of questionable veracity
having been subscribed in Bontoc, which is nearly 30 kilometers from the residences of the parties. Furthermore, he
claimed that considering that the said affiants never testified, he was never afforded the opportunity to cross-examine
them. Therefore, their affidavits were mere hearsay and insufficient to prove his guilt.
The petitioner does not persuade.
The essence of due process is simply to be heard, or as applied to administrative proceedings, a fair and reasonable
opportunity to explain one’s side, or an opportunity to seek a reconsideration of the action or ruling complained of.22
Administrative due process cannot be fully equated with due process in its strict judicial sense. In administrative
proceedings, a formal or trial-type hearing is not always necessary23 and technical rules of procedure are not strictly
applied. Hence, the right to cross-examine is not an indispensable aspect of administrative due process.24 The petitioner
cannot, therefore, argue that the affidavit of Bang-on and his witnesses are hearsay and insufficient to prove his guilt.
At any rate, having actively participated in the proceedings before the CSC-CAR, the CSC, and the CA, the petitioner was
apparently afforded every opportunity to explain his side and seek reconsideration of the ruling against him.
As to the issue of the veracity of the affidavits, such is a question of fact which cannot now be raised before the Court
under Rule 45 of the Rules of Court. The CSC-CAR, the CSC and the CA did not, therefore, err in giving credence to the
affidavits of the complainants and his witnesses, and in consequently ruling that there was substantial evidence to
support the finding of misconduct on the part of the petitioner.
On the Penalty
Assuming that he did box Bang-on, Pat-og argues that there is no substantial evidence to prove that he did so with a
clear intent to violate the law or in flagrant disregard of the established rule, as required for a finding of grave
misconduct. He insists that he was not motivated by bad faith or ill will because he acted in the belief that, as a teacher,
he was exercising authority over Bang-on in loco parentis, and was, accordingly, within his rights to discipline his student.
Citing his 33 years in the government service without any adverse record against him and the fact that he is at the edge
of retirement, being already 62 years old, the petitioner prays that, in the name of substantial and compassionate justice,
the CSC-CAR’s finding of simple misconduct and the concomitant penalty of suspension should be upheld, instead of
dismissal.
The Court agrees in part.
Misconduct means intentional wrongdoing or deliberate violation of a rule of law or standard of behavior. To constitute an
administrative offense, misconduct should relate to or be connected with the performance of the official functions and
duties of a public officer. In grave misconduct, as distinguished from simple misconduct, the elements of corruption, clear
intent to violate the law or t1agrant disregard of an established rule must be manifest.25
Teachers are duly licensed professionals who must not only be competent in the practice of their noble profession, but
must also possess dignity and a reputation with high moral values. They must strictly adhere to, observe, and practice the
set of ethical and moral principles, standards, and values laid down in the Code of Ethics of Professional Teachers, which
apply to all teachers in schools in the Philippines, whether public or private, as provided in the preamble of the said
Code.26 Section 8 of Article VIII of the same Code expressly provides that "a teacher shall not inflict corporal punishment
on offending learners."
Clearly then, petitioner cannot argue that in punching Bang-on, he was exercising his right as a teacher in loco parentis to
discipline his student. It is beyond cavil that the petitioner, as a public school teacher, deliberately violated his Code of
Ethics. Such violation is a flagrant disregard for the established rule contained in the said Code tantamount to grave
misconduct.
Under Section 52(A)(2) of Rule IV of the Uniform Rules on Administrative Cases in the Civil Service, the penalty for grave
misconduct is dismissal from the service, which carries with it the cancellation of eligibility, forfeiture of retirement
benefits and perpetual disqualification from reemployment in the government service.27 This penalty must, however, be
tempered with compassion as there was sut1icient provocation on the part of Bang-on. Considering further the mitigating
circumstances that the petitioner has been in the government service for 33 years, that this is his first offense and that he
is at the cusp of retirement, the Court finds the penalty of suspension for six months as appropriate under the
circumstances.
WHEREFORE, the Court PARTIALLY GRANTS the petition and MODIFIES the April 6, 2011 Decision of the Court of
Appeals in CA-G.R. SP No. 101700. Accordingly, Alberto Pat-og, Sr. is found GUlLTY of Grave Misconduct, but the penalty
is reduced from dismissal from the service to SUSPENSION for SIX MONTHS.
SO ORDERED.
JOSE CATRAL MENDOZA
Associate Justice

18. (on Venue)
G.R. No. 166920 February 19, 2007
PACIFIC CONSULTA NTS INTERNATIONAL ASIA, INC. and JENS PETER HENRICHSEN, Petitioners,
vs.
KLAUS K. SCHONFELD, Respondent.
D E C I S I O N
CALLEJO, SR., J.:
Before us is a Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court of the Decision1 of the Court
of Appeals (CA) in CA-G.R. SP No. 76563. The CA decision reversed the Resolution of the National Labor Relations
Commission (NLRC) in NLRC NCR CA No. 029319-01, which, in turn, affirmed the Decision of the Labor Arbiter in NLRC
NCR Case No. 30-12-04787-00 dismissing the complaint of respondent Klaus K. Schonfeld.
The antecedent facts are as follows:
Respondent is a Canadian citizen and was a resident of New Westminster, British Columbia, Canada. He had been a
consultant in the field of environmental engineering and water supply and sanitation. Pacicon Philippines, Inc. (PPI) is a
corporation duly established and incorporated in accordance with the laws of the Philippines. The primary purpose of PPI
was to engage in the business of providing specialty and technical services both in and out of the Philippines.2 It is a
subsidiary of Pacific Consultants International of Japan (PCIJ). The president of PPI, Jens Peter Henrichsen, who was also
the director of PCIJ, was based in Tokyo, Japan. Henrichsen commuted from Japan to Manila and vice versa, as well as in
other countries where PCIJ had business.
In 1997, PCIJ decided to engage in consultancy services for water and sanitation in the Philippines. In October 1997,
respondent was employed by PCIJ, through Henrichsen, as Sector Manager of PPI in its Water and Sanitation
Department. However, PCIJ assigned him as PPI sector manager in the Philippines. His salary was to be paid partly by
PPI and PCIJ.
On January 7, 1998, Henrichsen transmitted a letter of employment to respondent in Canada, requesting him to accept
the same and affix his conformity thereto. Respondent made some revisions in the letter of employment and signed the
contract.3 He then sent a copy to Henrichsen. The letter of employment reads:
Section 21 of the General Conditions of Employment
21 Arbitration
Any question of interpretation, understanding or fulfillment of the conditions of employment, as well as any question
arising between the Employee and the Company which is in consequence of or connected with his employment with the
Company and which can not be settled amicably, is to be finally settled, binding to both parties through written
submissions, by the Court of Arbitration in London.5
Respondent arrived in the Philippines and assumed his position as PPI Sector Manager. He was accorded the status of a
resident alien.
As required by Rule XIV (Employment of Aliens) of the Omnibus Rules Implementing the Labor Code, PPI applied for an
Alien Employment Permit (Permit) for respondent before the Department of Labor and Employment (DOLE). It appended
respondent’s contract of employment to the application.
On February 26, 1999, the DOLE granted the application and issued the Permit to respondent.
Respondent received his compensation from PPI for the following periods: February to June 1998, November to
December 1998, and January to August 1999. He was also reimbursed by PPI for the expenses he incurred in connection
with his work as sector manager. He reported for work in Manila except for occasional assignments abroad, and received
instructions from Henrichsen.7
On May 5, 1999, respondent received a letter from Henrichsen informing him that his employment had been terminated
effective August 4, 1999 for the reason that PCIJ and PPI had not been successful in the water and sanitation sector in
the Philippines.8 However, on July 24, 1999, Henrichsen, by electronic mail,9 requested respondent to stay put in his job
after August 5, 1999, until such time that he would be able to report on certain projects and discuss all the opportunities
he had developed.10 Respondent continued his work with PPI until the end of business hours on October 1, 1999.
Respondent filed with PPI several money claims, including unpaid salary, leave pay, air fare from Manila to Canada, and
cost of shipment of goods to Canada. PPI partially settled some of his claims (US$5,635.99), but refused to pay the rest.
On December 5, 2000, respondent filed a Complaint11 for Illegal Dismissal against petitioners PPI and Henrichsen with the
Labor Arbiter. It was docketed as NLRC-NCR Case No. 30-12-04787-00.
In his Complaint, respondent alleged that he was illegally dismissed; PPI had not notified the DOLE of its decision to close
one of its departments, which resulted in his dismissal; and they failed to notify him that his employment was terminated

19. after August 4, 1999. Respondent also claimed for separation pay and other unpaid benefits. He alleged that the
company acted in bad faith and disregarded his rights. He prayed for the following reliefs:
1. Judgment be rendered in his favor ordering the respondents to reinstate complainant to his former position
without loss of seniority and other privileges and benefits, and to pay his full backwages from the time
compensation was with held (sic) from him up to the time of his actual reinstatement. In the alternative, if
reinstatement is no longer feasible, respondents must pay the complainant full backwages, and separation pay
equivalent to one month pay for every year of service, or in the amount of US$16,400.00 as separation pay;
2. Judgment be rendered ordering the respondents to pay the outstanding monetary obligation to complainant in
the amount of US$10,131.76 representing the balance of unpaid salaries, leave pay, cost of his air travel and
shipment of goods from Manila to Canada; and
3. Judgment be rendered ordering the respondent company to pay the complainant damages in the amount of no
less than US $10,000.00 and to pay 10% of the total monetary award as attorney’s fees, and costs.
Other reliefs just and equitable under the premises are, likewise, prayed for.12
Petitioners filed a Motion to Dismiss the complaint on the following grounds: (1) the Labor Arbiter had no jurisdiction over
the subject matter; and (2) venue was improperly laid. It averred that respondent was a Canadian citizen, a transient
expatriate who had left the Philippines. He was employed and dismissed by PCIJ, a foreign corporation with principal
office in Tokyo, Japan. Since respondent’s cause of action was based on his letter of employment executed in Tokyo,
Japan dated January 7, 1998, under the principle of lex loci contractus, the complaint should have been filed in Tokyo,
Japan. Petitioners claimed that respondent did not offer any justification for filing his complaint against PPI before the
NLRC in the Philippines. Moreover, under Section 12 of the General Conditions of Employment appended to the letter of
employment dated January 7, 1998, complainant and PCIJ had agreed that any employment-related dispute should be
brought before the London Court of Arbitration. Since even the Supreme Court had already ruled that such an agreement
on venue is valid, Philippine courts have no jurisdiction.13
Respondent opposed the Motion, contending that he was employed by PPI to work in the Philippines under contract
separate from his January 7, 1998 contract of employment with PCIJ. He insisted that his employer was PPI, a Philippine-
registered corporation; it is inconsequential that PPI is a wholly-owned subsidiary of PCIJ because the two corporations
have separate and distinct personalities; and he received orders and instructions from Henrichsen who was the president
of PPI. He further insisted that the principles of forum non conveniens and lex loci contractus do not apply, and that
although he is a Canadian citizen, Philippine Labor Laws apply in this case.
Respondent adduced in evidence the following contract of employment dated January 9, 1998 which he had entered into
with Henrichsen:
According to respondent, the material allegations of the complaint, not petitioners’ defenses, determine which quasi-
judicial body has jurisdiction. Section 21 of the Arbitration Clause in the General Conditions of Employment does not
provide for an exclusive venue where the complaint against PPI for violation of the Philippine Labor Laws may be filed.
Respondent pointed out that PPI had adopted two inconsistent positions: it was first alleged that he should have filed his
complaint in Tokyo, Japan; and it later insisted that the complaint should have been filed in the London Court of
Arbitration.15
In their reply, petitioners claimed that respondent’s employer was PCIJ, which had exercised supervision and control over
him, and not PPI. Respondent was dismissed by PPI via a letter of Henrichsen under the letterhead of PCIJ in Japan.16
The letter of employment dated January 9, 1998 which respondent relies upon did not bear his (respondent’s) signature
nor that of Henrichsen.
On August 2, 2001, the Labor Arbiter rendered a decision granting petitioners’ Motion to Dismiss. The dispositive portion
reads:
WHEREFORE, finding merit in respondents’ Motion to Dismiss, the same is hereby granted. The instant complaint filed by
the complainant is dismissed for lack of merit.
SO ORDERED.17
The Labor Arbiter found, among others, that the January 7, 1998 contract of employment between respondent and PCIJ
was controlling; the Philippines was only the "duty station" where Schonfeld was required to work under the General
Conditions of Employment. PCIJ remained respondent’s employer despite his having been sent to the Philippines. Since
the parties had agreed that any differences regarding employer-employee relationship should be submitted to the
jurisdiction of the court of arbitration in London, this agreement is controlling.
On appeal, the NLRC agreed with the disquisitions of the Labor Arbiter and affirmed the latter’s decision in toto.18
Respondent then filed a petition for certiorari under Rule 65 with the CA where he raised the following arguments:
I
WITH ALL DUE RESPECT, THE HONORABLE NATIONAL LABOR RELATIONS COMMISSION GRAVELY ABUSED ITS
DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION WHEN IT AFFIRMED THE LABOR ARBITER’S
DECISION CONSIDERING THAT: