FIRST DIVISION

[G.R. No. L-41107. February 28, 1979.]

AMANDA L. VDA. DE DELA CRUZ, ET AL. , petitioners, vs. HON. COURT OF

APPEALS, MARCELO ABAGA, MARGARITA D. JOSE, MARTINA D. JOSE,
QUIRINO D. JOSE, TEOFILO D. JOSE, ET AL. , respondents.

Angel C. Ungson, Jr. for petitioner.

Juan J. de Dios and Simplicio M. Sevilleja for private respondents.

SYNOPSIS

Felix Jose and 114 other tenants were defendants in a suit for ejectment and collection of
unpaid rentals in the Court of Agrarian Relations. Felix Jose died before the termination of
the action, but no substitution was affected. Judgment was rendered against deceased
Felix Jose and his co-defendants. Some of his co-defendants brought the case to the
Supreme Court on certiorari, but the petition was dismissed for failure to file brief.
Thereafter, the conjugal properties of deceased Felix Jose and his wife were levied and
sold at public auction. The heirs of deceased Felix Jose, through another counsel,
thereafter moved to substitute the deceased and to set aside the decision, the writ of
execution and the sale of public auction. The trial court allowed the substitution but denied
the motion to set aside the proceedings. The substituted defendants then appealed to the
Court of Appeals which rendered judgment in their favor. Hence, this petition for review.
The Supreme Court affirmed the decision of the Court of Appeals holding that no valid
substitution having been affected after Jose's death, the trial court never acquired
jurisdiction over his heirs for the purpose of making them decision binding upon them.
Judgment affirmed.

SYLLABUS

1. CIVIL PROCEDURE; PARTIES; SURVIVAL OF ACTIONS; RULE APPLIED TO

EJECTMENT OF AGRICULTURAL LESSEES. The provisions of Rule 17, Sec. 3 of the Rules
of Court which provides for substitution of parties in actions which survive are applicable
to a complaint for ejectment of agricultural tenants, since an action is not extinguished on
account of Sections 9, Rep. Act 1199 (Rep. Act 6389, Code of Agrarian Reforms), which
provides in effect that in case of death or permanent incapacity of the agricultural lessee,
the leasehold shall continue between the lessor and the persons enumerated in said
section which include the descendants of the deceased.
2. ID.; ID.; ID.; EFFECT OF LACK OF SUBSTITUTION. The continuance of a proceeding
during the pendency of which a party thereto dies, without such party having been validly
substituted in accordance with the rules, amounts to lack jurisdiction. Assuming that
jurisdiction was acquired at the outset over the defendant, it was inevitably impaired on his
death pending the proceedings such that unless and until a legal representative is for him
duly named and within the jurisdiction of the court, no adjudication in the cause could be
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 accorded any validity or binding effect on any party, in representation of the deceased,
without trenching upon the fundamental right to a day court which is the very essence of
the constitutionally enshrined guarantee of due process.
3. ID.; ID.; SUBSTITUTION BASED ON RIGHT TO DUE PROCESS. The need for
substitution is based on the right of a party to due process. One may infer from the use of
the word "shall" in Rule 3, Sec. 17, Revised Rules of Court that substitution is indeed a
mandatory requirement in actions surviving the deceased. And in statutes relating to
procedure, every act which is jurisdictional, or of the essence of the proceedings, or is
prescribed for the protection or benefit of the party affected, is mandatory.
4. ID.; ID.; ID.; SUBSTITUTION SHOULD BE ORDERED EVEN AFTER JUDGMENT.
Substitution should be ordered even after judgment has been rendered since proceedings
may still be taken, like an execution; and the legal representative must appear to protect
the interests of the deceased and in all such proceedings.
5. APPEAL; FINDINGS OF FACTS OF COURT OF APPEALS. In a petition for review on
certiorari, where only questions law may be raised, the findings of facts by the Court of
Appeals are in general, final and conclusive, except when (1) the conclusion is a finding
grounded entirely on speculation; (2) the inference is manifestly mistaken, absurd or
impossible; (3) there is a grave abuse of discretion; (4) the judgment is based on a
misapprehension of facts; (5) the Court of Appeals in making its findings, went beyond the
issues of the case and the same are contrary to the submission of both appellant and
appellee.
6. ID.; RES JUDICATA; DISMISSAL OF APPEAL. The dismissal of the appeal by the
Supreme Court for failure of the petitioners to file their brief or memorandum within the
prescribed period could not bar the heirs of the deceased from questioning all the
proceedings, particularly if the fact is considered that there could not have been a final
judgment on the merits since in the first place, jurisdiction over the deceased defendant
was lacking in the lower court, since no substitution was effected after the death of
deceased.

DECISION

DE CASTRO , J : p

This is a petition for certiorari seeking to review the decision of the Court of Appeals in
case CA-G.R. No. 47331-R entitled "Amanda L. Vda. de dela Cruz, et al., plaintiffs-appellees,
versus Marcelo Abaga, Margarita D. Jose, et al., defendants." The questioned decision
ordered the setting aside of the decision rendered by the Court of Agrarian Relations in
CAR Case No. 115-TP-59 and 116-TP-59 and proceedings subsequent thereto insofar as it
affected the deceased defendant Felix Jose or his heirs, the private respondents in this
petition.
As narrated by the Court of Appeals in its decision, it appears that plaintiffs (herein
petitioners) filed an action ejectment and collection of unpaid rentals against Felix Jose
and 114 other tenants on November 23, 1959 in the Court Agrarian Relations, Tayug,
Pangasinan. Their complaint alleged that Felix Jose is a tenant over a 4.5 ha. landholding in
plaintiffs' hacienda in Tayug, Pangasinan, paying a fixed rental of 850 kilos of palay per
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 hectare per agricultural year; that he failed to pay in full his rentals and despite plaintiffs'
repeated demands, Felix Jose refused to vacate the landholding and to pay his obligation.
1 In a join answer filed through their counsel, Atty. Fausto G. Cabotaje, defendant Felix Jose
and his 114 co-defendants denied the material averments of the complaint, alleging
payment of all the rentals of their respective landholdings. Thereafter, trial was
commenced. However, as found by the Court of Appeals, "before termination thereof, or on
June 5, 1961, Felix Jose died at the Eastern Pangasinan Provincial General Hospital in
Tayug, Pangasinan (Record, Vol. 1, p. 509). It appears that Jose's demise no substitution
of defendant was effected." 2
Then on March 29, 1962, the trial court rendered judgment against Felix Jose together with
the other defendants holding him liable to plaintiffs for 6,432 kilos of palay as unpaid
rentals. Some of his co-defendants then brought the case to the Supreme Court for review
on certiorari where it was docketed as G. R. No. L-19930-19935. However, the petition was
dismissed on November 30, 1962 due to the petitioners' failure to file their brief
(Appellee's Brief, pp. 2-8). Thereafter on plaintiffs' motion, the Court of Agrarian Relations
issued an order of execution (Appendix B of Appellant's Brief, pp. 54-60). On May 3, 1963,
a writ of execution to effect ejectment was entered (Appendix C, Appellants' Brief, pp. 60-
69). To satisfy the award of damages under the decision of the Court of Agrarian
Relations, the conjugal properties of the deceased Felix Jose and his wife were sold at
public auction. A certificate of sale dated July 31, 1969 was later issued in favor of plaintiff
Amanda L. Vda. de la Cruz as highest bidder. The sheriff's final deed of sale followed on
August 17, 1970. llcd

On October 27, 1970, the heirs of the deceased defendant, through their new counsel, Atty.
Juan V. Landingin, filed a motion to substitute the deceased and to set aside as null void
the decisions, orders, writ of execution and sale at public auction made and entered
against the latter. The trial court allowed the substitution "for the purposes of whatever
proceedings may still be allowed in this case" (p. 23, rollo) but denied the motion to set
aside the decision, orders, writ of execution and the public auction sale. The motion for
reconsideration was likewise denied. The substituted defendants then appealed to the
Court of Appeals, raising mainly the question of the validity of the lower court's decision on
the ground that despite it's awareness of the death of said defendant, no substitution was
ordered before decision was rendered on March 29, 1962.
The Court of Appeals found the appeal meritorious. Against its decision, a motion for
reconsideration was filed but was denied. Hence, this petition for review on certiorari,
alleging mainly that the Court of Appeals erred: 3
1. "in entertaining an appeal from the order of the Court of Agrarian Relations,
in reversing the decision of the Court of Agrarian Relations of March 29, 1962,
setting aside the same and the auction sale of July 2, 1969, the certificate of sale
dated July 31, 1969, and the final deed of sale of August 17, 1979," with respect
to Felix Jose, considering that a period of more than eight (8) years had elapsed
from the rendition of the decision of the trial court to the filing of the motion for
substitution:

2. "in not considering the decision of the Supreme Court in cases G.R. Nos. L-
19930-19935 as having the effect of res judicata, based not only on the general
application of the rule but on the basis of the agreement of the parties before the
Court of Agrarian Relations that the cases be heard jointly and one decision for all
the cases is sufficient.

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 3. "in finding that the trial was still going on and not yet terminated when
Felix Jose died on June 5, 1961, and that the continuance of the trial after the
death of defendant, without such partly having been substituted in accordance
with the aforesaid Rule amounts to lack of jurisdiction."

To begin with, the Court of Appeals found that the defendant Felix Jose died before the
termination of the trial, contrary to petitioner's claim that when said defendant died, the
trial was already terminated (pp. 11, rollo), and hence, there was no denial of due process.
Whether defendant died before or after termination of trial is not all that important
because one thing is certain; that he died before the rendition of judgment. This fact was
known to the Judge of the Court of Agrarian Relations (Appellant's Brief, pp. 48-49), who in
his decision placed the word "dead" in parenthesis beside the name of Felix Jose
(Appendix A, Appellants' Brief, p. 49). The Court of Appeals took this into consideration
when it held that the decision of said court was a "patent nullity" insofar as Felix Jose was
concerned. As stated by the Appellate Court, no substitution of the deceased was ordered
by the trial court, in disregard of the provisions of Rule 3, Sec. 17, Rules of Court which reed
thus: cdrep

SEC. 17. Death of a party. After a party dies and the claim is not thereby
extinguished, the court shall order, upon proper notice, the legal representative of
the deceased to appear and to be substituted for the deceased within a period of
thirty (30) days, or within such time as may be granted. If the legal representative
fails to appear within said time, the court may order the opposing party to procure
the appointment of a legal representative of the deceased within a time to be
specified by the court, and the representative shall immediately appear for and on
behalf of the interest of the deceased. The court charges involved in procuring
such appointment, if defrayed by the opposing party, may be recovered as costs.
The heirs of the deceased may be allowed to be substituted for the deceased,
without requiring the appointment of an executor or administrator and the court
may be appoint guardian ad litem for the minor heirs.

In Caseas vs. Rosales (19 SCRA 466). Caisip vs. Cabangon (109 Phil, 154) and Bonilla vs.
Barcena (71 SCRA 495), this Court held that in case of the death of a party and due notice
is given to the trial court, it is the duty of the court to order the legal representative of the
deceased to appear for him, in the manner outlined in the aforementioned Rule.
Considering the complaint was for ejectment of the tenants, (defendant, being one of
them) the provisions of said section and the rulings in the aforementioned cases are
indeed applicable to the present case, where the action or the claim is not extinguish
account of Section 9, RA 1199, (now RA 6389, Code of Agrarian Reforms) which provides
in effect that in case of death or permanent incapacity of the agricultural lessee, the
leasehold shall continue between the lessor and the persons enumerated in said Section
which include the descendants of the deceased. But as noted by the Court of Appeals 4 : "it
appears that no legal representative was ever summoned pear in court; that no legal
representative appeared to be substituted; and that plaintiffs did not procure the
appointment of such legal representatives." As a result, the "continuance of a proceeding
during the pendency of which a party thereto dies, without such having been validly
substituted in accordance with the rules, amounts to lack of jurisdiction." 5 The same ruling
was given in the earlier case of Ferreria vs. Gonzales (104 Phil. 143), where this Court set
aside the decision of the Court of Agrarian Relations because "no valid substitution was
effected, consequently, the court never acquired jurisdiction over appellant for the purpose
of making the decision binding upon her either personally or as legal representative of the
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 estate of her deceased mother." Assuming that jurisdiction was ever acquired at the
outset over defendant Felix Jose, it was: llcd

"inevitably impaired on the death of the protestee pending the proceedings below
such that unless and until a legal representative is for him duly named and within
the jurisdiction of the trial court, no adjudication in the cause could have been
accorded any validity or binding effect on any party, in representation of the
deceased, without trenching upon the fundamental right to a day in court which is
the very essence of the constitutionally enshrined guarantee of due process." 6

The need therefore for substitution is based on the right of a party to due process.
Summing up then the previous ruling 5 this Court in the afore-cited cases, and noting that
the Rule 3, Sec. 17, Revised Rules of Court uses the word "shall', one infers that substitution
is indeed a mandatory requirement in actions surviving the deceased. It has been held that
in "statues relating to procedure . . . every act which is jurisdictional, or of the essence of
the proceedings, or is prescribed for the protection or benefit of the party affected, is
mandatory." 7 The petitioners, however, take the contrary view, pointing to the case of Lota
vs. Tolentino (90 Phil. 831) to argue that the said section involves only a procedural
requirement (Petitioners' Brief, p. 16). A reading of the said case shows that the nature of
the action filed by the plaintiff was purely personal since it was for accounting and
liquidation of the partnership, and on defendant's death, the claim we extinguished.
In any case, substitution should be ordered even after judgment has been rendered since
proceedings may still be taken-as was done in this case like an execution; and the legal
representative must appear to protect the interests of the deceased and in all such
proceedings. 8 In this instance, however, the Court of Appeals found that there is "no
showing that the appellants were notified of the decision dated March 29, 1962 or of the
auction sale held thereafter." 9 Petitioners take issue with the Appellate Court on this point.
But since the present petition is for review on certiorari, where "only questions of law may
be raised," (R. 45, Sec. 2, Revised Rules of Court), this Court has held in a number of cases
that findings of facts by the Court of Appeals are; in general, final and conclusive (Chan vs.
Court of Appeals, 33 SCRA 737; Ramirez Te. Corp. vs. Bank of America, 32 SCRA 191;
Castro vs. Tamporong, 78 Phil. 804 to name a few), except when: 1 0
1. the conclusion is a finding grounded entirely on speculation,
2. the inference made is manifestly mistaken, absurd or impossible;
3. there is a grave abuse of discretion;

4. the judgment is based on a misapprehension of facts;

5. the Court of Appeals is making its findings, went beyond the issues of the
case and the same are contrary to the submission of both appellant and appellee.

None of the above exceptions however applies to the case at bar, so there is no reason
to disturb the findings of the Court of Appeals.
Petitioners also contend that since two of the private respondents were co-respondents
with their father in the complaint before the Court of Agrarian Relations, petitioners
"believe that they were supposed to have represented their father in the appeal to the
Supreme Court. "Likewise, they maintain that the decision of the Court in the said appeal
operated as res judicata on all matters which might have been litigated and decided before
the judgment became final (pp. 7-9, rollo). prLL

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 With reference to the first objection, it is worthy to note that the herein private respondents
were sued in their individual capacity for their separate and respective obligations. The
dismissal of the appeal by the Supreme Court for failure of the petitioners to file their brief
or memorandum within the prescribed period could not, therefore, bar the heirs of the
deceased from questioning all the proceedings, particularly if the fact is considered that
there could not have been a final judgment on the merits since in the first place, jurisdiction
over the deceased defendant was lacking in the lower court, as heretofore shown.
Accordingly there can be no res judicata as contended by petitioner. 1 1
IN VIEW OF THE FOREGOING, We hereby affirm the decision of the Court of Appeals, No
pronouncement as to costs.
SO ORDERED.
Teehankee (Chairman), Makasiar, Fernandez, Guerrero and Melencio Herrera, JJ., concur.
Footnotes

1. Pp. 20-23, Rollo.

2. Appendix A, Petitioners' Brief, pp. 19-20.
3. Brief for the Petitioners, pp. 2-4.
4. 26, Rollo.

5. Caseas vs. Rosales, 19 SCRA 496-497.

6. Vda. de Mesa vs. Mencias, 18 SCRA 540.
7. Ibid., p. 542, citing Gonzaga, Statutes & Their Construction, p. 98.
8. Moran, Rules of Court, 1970 Ed. Vol. I, p. 208.
9. Brief for Petitioners, Appendix A, p. 24.

10. Ramos vs. Court of Appeals, 63 SCRA 331.

11. The second requisite of res judicata is that the Court rendering the final judgment or
order must have jurisdiction over the subject matter and over the parties. See Dacosin vs.
Court of Appeals, 80 SCRA 89; Municipality of Hagonoy vs. Secretary of Agriculture and
Natural Resources, 73 SCRA 507; Philippine Commercial and Industrial vs. Pfleider, 65
SCRA 13.

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