RULES 6-7 PLEADINGS o Respondent Kemper insured the shipment of imported

AMENDMENTS frozen boneless beef (owned by Genosi, Inc.), which

No change in nature of complaint, answer; but all pleadings was loaded at a port in Brisbane, Australia, for
raising claims on defense will have to incorporate names of shipment to Genosi, Inc. (the importer-consignee) in the
witnesses to be presented, summary of intended testimony. Philippines. 
Attach also documentary and object evidence. o However, upon arrival at the Manila port, a portion of
Joinder of Issues the shipment was rejected by Genosi, Inc. by reason of
Why would they want the filing of an Answer? Because spoilage arising from the alleged temperature
without an Answer, issues are not joined. Now, they can fluctuations of petitioner's reefer containers.
proceed to pretrial and then mediation. o Thus, Genosi, Inc. filed a claim against both petitioner
Reply: not required before; now, it is prohibited UNLESS there Cosco shipping company and respondent Kemper
is an actionable document attached to the Answer--here, Insurance Company
plaintiff can file a Reply because it is plaintiff's duty to read o The claim was referred to McLarens Chartered for
that. investigation, evaluation, and adjustment of the claim. 
Two kinds of counterclaim: directed against opposing party o After processing the claim documents,
1. Compulsory: necessary arises from main action. Test Is McLarens Chartered recommended a settlement
WON action would have been Instituted without main action-- of the claim in the amount of $64,492.58, which
If no, compulsory Genosi, Inc. (the consignee-insured) accepted.
2. Permissive: can be a counterclaim or be a separate o Thereafter, respondent Kemper paid the claim of
Independent action. Why allowed? To limit number of filings Genosi, Inc. (the insured) in the amount of $64,492.58.
In court. o Consequently, Genosi, Inc., through its General
Cross-claim: directed against co-party Manager, Avelino S. Mangahas, Jr., executed a Loss
Whether counter- or cross-, no need for LOC. The person and Subrogation Receipt in favor of Respondent
against whom you've made these claims, the court already Kemper
acquires jurisdiction as distinguished from a third party o Respondent Kemper then made demands upon
complaint--here, LOC Is needed because the court has not yet petitioner, but the latter failed and refused to pay the
acquired juris over this person. said amount.
Why file a 3rd party complaint? To ask for contribution (i.e. o Respondent Kemper filed a Complaint for Insurance
car accident--kaya kita nabunggo kasi binunggo din ako), Loss and Damages against petitioner Cosco before the
payment, etc. RTC Manila
When Is a 3rd party complaint denied? Rule 6.11 o Respondent alleged that despite repeated
COSCO PHILIPPINES v KEMPER demands to pay and settle the total amount of 
FACTS US$64,492.58, representing the value of the
 loss, petitioner failed and refused to pay the performed in behalf of the corporate entity by
same specifically authorized individuals. 
o Loss and damage it sustained was due to the o actual circumstances of the case warranted the
fault and negligence of petitioner, specifically, liberal application of the rules and, as such,
the fluctuations in the temperature of the reefer ordered the remand of the case to the trial court
container for further proceedings.
o Cosco’s Answer: respondent had no capacity to sue o MR Denied. Petition for Certiorari R45
since it was doing business in the Philippines without
the required license
o Loss or damage sustained by the shipments, if ISSUE/S && RATIO
any, was due to causes beyond the carrier's WON the CA erred in ruling that Atty, Rodolfo Lat was
control and was due to the inherent nature or properly authorized by Kemper to sign the certificate of
insufficient packing non-forum shopping- YES
o During pre trail, the respective parties marked their
evidence. o Petitioner: Respondent Kemper failed to submit any
o Petitioner Cosco filed a Motion to Dismiss, contending board resolution or secretary's certificate authorizing
that the same was filed by one Atty. Rodolfo A. Lat, Atty. Lat to institute the complaint and sign the
who failed to show his authority to sue and sign the certificate of non-forum shopping on its behalf. 
corresponding certification against forum shopping. o since respondent is a juridical entity, the
o RTC: Ruled in favor of Petitioner Cosco. Granted signatory in the complaint must show proof of
MTD.  Mandatory that the certification must be his or her authority to sign on behalf of the
executed by the petitioner himself, and not by counsel. corporation
o Since respondent's counsel did not have a o Respondent: admitted that it failed to attach in the
Special Power of Attorney (SPA) to act on its complaint a concrete proof of Atty. Lat's authority to
behalf, hence, the certification against forum execute the certificate of non-forum shopping on its
shopping executed by said counsel was fatally behalf.
defective and constituted a valid cause for o But subsequent compliance as respondent
dismissal of the complaint submitted an authenticated SPA empowering
o CA: Ruled in favor of Respondents. The required Atty. Lat to represent it in the pre-trial and all
certificate of non-forum shopping is mandatory and that stages of the proceedings
the same must be signed by the plaintiff or principal o We have consistently held that the certification against
party concerned and not by counsel; and in case of forum shopping must be signed by the principal parties.
corporations, the physical act of signing may be
o If, for any reason, the principal party cannot sign the o The lack of certification against forum shopping is
petition, the one signing on his behalf must have been generally not curable by mere amendment of the
duly authorized. complaint, but shall be a cause for the dismissal of the
o With respect to a corporation, the certification against case without prejudice.
forum shopping may be signed for and on its behalf, by o The same rule applies to certifications against forum
a specifically authorized lawyer who has personal shopping signed by a person on behalf of a corporation
knowledge of the facts required to be disclosed in such which are unaccompanied by proof that said signatory
document is authorized to file the complaint on behalf of the
o A corporation exercises said powers through its board corporation
of directors and/or its duly authorized officers and o There is no proof that respondent, a private corporation,
agents.  authorized Atty. Lat, through a board resolution, to sign
o Thus, it has been observed that the power of a the verification and certification against forum
corporation to sue and be sued in any court is lodged shopping on its behalf.  Accordingly, the certification
with the board of directors that exercises its corporate against forum shopping appended to the complaint is
powers. fatally defective, and warrants the dismissal of
o In turn, physical acts of the corporation, like the signing respondent's complaint for Insurance Loss and
of documents, can be performed only by natural persons Damages against petitioners
duly authorized for the purpose by corporate by-laws or o While the Court has cited instances wherein the lack of
by a specific act of the board of directors authority of the person making the certification of non-
o Philippine Airlines, Inc. v. Flight Attendants and forum shopping was remedied through subsequent
Stewards Association of the Philippines (FASAP) we compliance by the parties therein and for justifiable
ruled that only individuals vested with authority by a reasons, no such exceptional circumstances are present
valid board resolution may sign the certificate of non- in this case
forum shopping on behalf of a corporation. We also o There was no proof of authority submitted, even
required proof of such authority to be presented. The belatedly, to show subsequent compliance with the
petition is subject to dismissal if a certification was requirement of the law.
submitted unaccompanied by proof of the signatory's o Neither was there a copy of the board resolution or
authority. secretary's certificate subsequently submitted to the trial
o In the present case, since respondent is a corporation, court that would attest to the fact that Atty. Lat was
the certification must be executed by an officer or indeed authorized to file said complaint and sign the
member of the board of directors or by one who is duly verification and certification against forum shopping,
authorized by a resolution of the board of directors; nor did respondent satisfactorily explain why it failed to
otherwise, the complaint will have to be dismissed comply with the rules.
 o Thus, there exists no cogent reason for the relaxation of Joselito Ma. P. Jacinto and F. Jacinto Group, Inc
the rule on this matter.  Obedience to the requirements ordering the latter to pay
of procedural rules is needed if we are to expect fair o Petitioner and F. Jacinto Group, Inc. filed an appeal
results therefrom, and utter disregard of the rules cannot with the NLRC.
justly be rationalized by harking on the policy of liberal o However, the appeal was not perfected for
construction. failure to post the proper cash or surety bond;
o Moreover, the SPA dated May 11, 2000, submitted by this was the finding of the NLRC in its
respondent allegedly authorizing Atty. Lat to appear on Resolution 
behalf of the corporation, in the pre-trial and all stages o Thus, the Decision became final and executory. And a
of the proceedings, signed by Brent Healy, was fatally writ of execution was issued in the labor case.
defective and had no evidentiary value.  o Real property belonging to petitioner located in Baguio
o It failed to establish Healy's authority to act in behalf of City was levied upon, and was scheduled to be sold at
respondent, in view of the absence of a resolution from auction petitioner filed an Extremely Urgent Motion to
respondent's board of directors or secretary's certificate Lift and Annul Levy on Execution
proving the same. o LA: Denied petitioner’s extremely urgent motion to lift
o Jurisdiction is the power with which courts are invested and annul levy on execution. Sheriff directed to
for administering justice; that is, for hearing and proceeed with the sale.
deciding cases. In order for the court to have authority o NLRC: respondents-appellants’ Motion to Lift and
to dispose of the case on the merits, it must acquire Annul Levy is GRANTED. Remand back to LA
jurisdiction over the subject matter and the parties.  o Petitioner went up to the CA via Certiorari assailing the
o Courts acquire jurisdiction over the plaintiffs NLRC’s resolutions
upon the filing of the complaint, and to be o The Petition in CA-G.R. SP No. 111098
bound by a decision, a party should first be contained a verification and certification of non-
subjected to the court's jurisdiction. forum shopping that was executed and signed
o Clearly, since no valid complaint was ever filed with not by petitioner, but by his counsel Atty.
the RTC, Branch 8, Manila, the same did not acquire Ronald Mark S. Daos
jurisdiction over the person of respondent. o CA: The Verification and Certification of Non-Forum
Shopping, which accompanied the petition at bar, was
JACINTO v GUMARU executed and signed by petitioner’s counsel Atty.
FACTS Ronald Mark S. Daos, in violation of Section 5,Rule 7
o An NLRC Decision was rendered in favor of of the Revised Rules of Court.
respondent Eduardo Gumaru, Jr. and against petitioner o Pursuant to Supreme Court Revised Circular
No. 28-91, the duty to certify under oath is
 strictly addressed to petitioner which in this case against forum-shopping, he could execute a special
is herein petitioner Joselito P. Jacinto and not power of attorney authorizing his lawyer to execute the
his counsel to [sic] Atty. Ronald Mark S. Daos. verification and sign the certification on his behalf.
Thus, to allow the delegation of said duty to Which is exactly what petitioner did
anyone would render Supreme Court Revised o Petitioner next argues that there are compelling
Circular No. 28-91 inutile. reasons to grant his Petition for Certiorari. He
o Petitioner’s MR: verification signed by counsel asserts that the NLRC committed grave abuse of
constitutes adequate and substantial compliance under discretion in issuing questioned resoltions
Sections 4 and 5, Rule 7 of the 1997 Rules of Civil demanding the case to the Labor Arbiter for
Procedure; verification is merely a formal, and not further proceedings on execution, claiming that
jurisdictional, requisite such that an improper the December 6, 2004 Decision of the Labor
verification or certification against forum-shopping is Arbiter had not attained finality since the NLRC
not a fatal defect. failed to furnish him with a copy 
o That Petitioners submitted an affidavit o Respondents: dismissal of petitioner’s certiorari petition
acknowledged begore Consul Cortes in Hawaii by the CA, it is for all intents and purposes deemed to
Affidavit, where he certified that he has not have never been filed, and thus may not be corrected by
commenced any other action or proceeding, or resorting to a Petition for Review under Rule 45.
filed any claims involving the same issues in the o Verification and Certification against forum-
Supreme Court, Court of Appeals, or any shopping accompanying the instant Petition was
Division thereof, or in any other court, tribunal not signed by petitioner, but by his counsel, in
or agency consistent violation of the Court’s Circular No.
o MR DENIED 28-91 and Rule 7 of the 1997 Rules of Civil
Procedure.1âwphi1
ISSUE/S && RATIO o SC: It is true, as petitioner asserts, that if for reasonable
WON the CA erred in dismissing the subject petition- or justifiable reasons he is unable to sign the
MOOT verification and certification against forum shopping in
his CA Petition, he may execute a special power of
While the SC agrees with petitioner, the act of satisfying attorney designating his counsel of record to sign the
the judgement has placed this case beyond the Court’s Petition on his behalf.
review.
Jurisprudential Pronouncements 
o Petitioner: If, for reasonable or justifiable reasons, a o A distinction must be made between non-compliance
party is unable to sign the verification and certification with the requirement on or submission of defective
 verification, and non-compliance with the requirement only one of them in the certification against forum
on or submission of defective certification against shopping substantially complies with the Rule.
forum shopping.
o As to verification, non-compliance therewith or a defect o Finally, the certification against forum shopping
therein does not necessarily render the pleading fatally must be executed by the party-pleader, not by his
defective. The court may order its submission or counsel. H, however, for reasonable or justifiable
correction or act on the pleading if the attending reasons, the party-pleader is unable to sign, he must
circumstances are such that strict compliance with the execute a Special Power of Attorney designating his
Rule may be dispensed with in order that the ends of counsel of record to sign on his behalf
justice may be served thereby.
o Verification is deemed substantially complied with o However, while the Court takes the petitioner's side
when one who has ample knowledge to swear to the with regard to the procedural issue dealing with
truth of the allegations in the complaint or petition signs verification and the certification against forum
the verification, and when matters alleged in the shopping, it nonetheless appears that the Petition has
petition have been made in good faith or are true and been overtaken by events
correct. o Respondent informed this Court that the judgment
award has been satisfied in full. 
o As to certification against forum shopping, non- o The petitioner does not dispute this claim, in which
compliance therewith or a defect therein, unlike in case, the labor case is now deemed ended. "It is
verification, is generally not curable by its subsequent axiomatic that after a judgment has been fully satisfied,
submission or correction thereof, unless there is a need the case is deemed terminated once and for all
to relax the Rule on the ground of "substantial o And "when a judgment has been satisfied, it passes
compliance" or presence of "special circumstances or beyond review, satisfaction being the last act and the
compelling reasons." end of the proceedings, and payment or satisfaction of
the obligation thereby established produces permanent
o The certification against forum shopping must be and irrevocable discharge; hence, a judgment debtor
signed by all the plaintiffs or petitioners in a case; who acquiesces to and voluntarily complies with the
otherwise, those who did not sign will be dropped as judgment is estopped from taking an appeal therefrom."
parties to the case. Under reasonable or justifiable o The satisfaction of the judgment in full has placed the
circumstances, however, as when all the plaintiffs or case beyond the Court's review. "Indeed, there are no
petitioners share a common interest and invoke a more proceedings to speak of inasmuch as these were
common cause of action or defense, the signature of terminated by the satisfaction of the judgment."
NARCISO v PACIFIC TRADERS orders from its foreign buyers which can no longer be
FACTS accommodated by its regular employees
o Petitioners were the employees of Pacific Traders o Petitioners were paid all the salaries and benefits
Manufacturing Corporation (PTMC), a domestic due them under the law and when their contracts
corporation engaged in the business of manufacturing expired, they voluntarily executed "Releases and
furniture and fixtures for export. Quitclaims."
o They were hired on different dates from 1999 to o TWMPC confirmed that the petitioners were its
2002 and in various capacities such as framer, bonafide members. They agreed to work on specific
attacher, finisher, assembler, etc. works on particular job orders contracted by TWMPC
o Tabok Workers Multi-Purpose Cooperative (TWMPC) with different companies
is a cooperative duly registered with the Cooperative o TWMPC's Board of Directors contemplated to
Development Authority among the purposes of which is try a "pakyaw system" instead of the per hour
"to engage in job out works of rattan and wood system of compensation. 
companies to the Pacific Rattan Manufacturing o Petitioners disagreed and this eventually settled
Corporation and other manufacturing companies. when the petitioners verbally acquiesced to
o The present controversy arose when the petitioners filed withdraw their membership from TWMPC
in 2004, complaints for illegal dismissal with money provided they will be paid separation pay and
claims against PTMC and TWMPC before NLRC Cebu other amounts they were entitled to receive as
o Alleged that they were regular employees of cooperative members. 
PTMC o Despite this verbal agreement, however, the petitioners
o Sometime in 2000, PTMC referred them to filed complaints before the DOLE and the NLRC
TWMPC in view of PTMC's refusal to sign a o DOLE case was later on dismissed upon an amicable
casual or probationary employment contract settlement between the petitioners and TWMPC.
with them. o The complaints before the NLRC RAB-VII were
o They claimed to have been treated indifferently by consolidated and jointly resolved by the Labor Arbiter
TWMPC and were not given the proper labor benefits. o LA: petitioners were not illegally dismissed. TWMPC
o When they reported the matter to the Department of was directed to pay their separation pay as well as the
Labor and Employment (DOLE), TWMPC terminated amount of benefits due them as members of the
them from employment without just or authorized cooperative. 
cause. o Petitioners were not employees of PTMC which
o PTMC denied that the petitioners were its regular was accordingly discharged from any liability
employees and instead claimed that they were hired on o The petitioners and TWMPC appealed to the NLRC
a contractual or casual basis to meet the volume of
 o NLRC dismissed both appeals outright for failure to o Hence, in ruling on the correctness of the CA's review
attach the requisite Certificate of Non-Forum Shopping. of the NLRC decision, this Court is confined to a
o Petitioners moved for the reconsideration of the review of the case solely on pure questions of law.
foregoing order. o The petitioners aver that the CA should have granted
o They also submitted a Motion to Admit their petition for certiorari and relaxed the NLRC Rules
Certificate of Non-Forum Shopping pleading of Procedure because on page 53 of their memorandum
for a liberal application of procedural rules in on appeal is the caption "Verification and
the interest of substantial justice Certification."
o NLRC: Denied MR. Its Resolution became final and o However, the counsel for the petitioners
executory. inadvertently deleted the paragraphs intended
o Petitioners persisted in their cause and elevated the for the certification of non-forum shopping.
matter to the CA via a petition for certiorariunder Rule o They assert that they were in a hurry in
65 of the Rules of Court ascribing grave abuse of preparing the memorandum due to the very
discretion to the NLRC limited time of 10 days to file the same.
o CA: Dismissed the petition upon finding that the o They proffer these as justifiable causes for their
petitioners failed to file the certificate of non-forum non-compliance with the NLRC Rules of
shopping within the reglementary period of filing a Procedure and submit that their belated filing of
Memorandum of Appeal the certificate in their motion for reconsideration
o Petitioners failed to cite any compelling reason was substantial compliance
which will warrant a relaxation of procedural o Outright dismissal of their appeal on a mere
rules. MR Denied. technicality would seriously impair the orderly
administration of justice
ISSUE/S && RATIO o The petitioners' arguments are devoid of merit. The
WON the CA erred in strictly applying the requirement of subsequent compliance with the requirement does not
the certificate of non-forum shopping despite the presence excuse a party's failure to comply therewith in the first
of highly exceptional cases- NO instance.
o The findings of the NLRC are generally binding and o While the Court, in certain cases, has excused non-
should be treated with finality. The CA only looks at compliance with the requirement to submit a certificate
the facts to determine if a tribunal, board or officer of non-forum shopping, such liberal posture has always
exercising judicial or quasi-judicial functions acted been grounded on special circumstances or compelling
without or in excess of its or his jurisdiction, or with reasons which made the strict application of the rule
grave abuse of discretion amounting to lack or excess of clearly unjustified or inequitable
jurisdiction in appreciating the facts.
o Here, the reasons cited by the petitioners for their o The Court thus agrees with the CA that no grave abuse
failure to attach the certificate in their appeal of discretion is attributable to the NLRC when it found
memorandum can hardly be considered as special no justification to excuse the absence of a certificate of
circumstances or compelling reasons to warrant a non-forum shopping in the petitioners' memorandum on
liberal application of the rules of procedure. appeal.
o Moreover, based on the facts of the case, a strict
application of a technical rule will not prejudice the VILLACAR TRANSIT v CATUBIG
administration of justice in view of the petitioners' FACTS
unmeritorious claims. o Petitioner Villacar is engaged in the business of
o It is true that in labor cases, technical rules are not transportation and the franchise owner of a Ceres
necessarily fatal and they can be liberally applied. Bulilit bus with Plate No. T-0604-1348.
However, this principle can only operate if, all things o Quirino C. Cabanilla (Cabanilla) is employed as a
being equal, any doubt or ambiguity would be resolved regular bus driver of petitioner
in favor of labor. Should the case be substantively o Respondent Jocelyn Catubig’s  Quintin Catubig, Jr.
unmeritorious, technicalities and limitations in (Catubig), was on his way home from Dumaguete City
procedural rules must be fully enforced riding in tandem on a motorcycle with his employee,
o The claims advanced by the petitioners failed to yield Teddy Emperado (Emperado)
substantive merit. First, their money claims have o While approaching a curve at kilometers 59 and 60,
already been amicably settled and paid in the Catubig tried to overtake a slow moving ten-wheeler
concurrent labor case they filed before the DOLE. The cargo truck by crossing-over to the opposite lane, which
Quitclaim and Release signed by the petitioners show was then being traversed by the Ceres Bulilit bus driven
that they already received payment for their claims by Cabanilla, headed for the opposite direction.
from TWMPC and PTMC. o When the two vehicles collided, Catubig and Emperado
o Second, the LA correctly ruled that the petitioners' were thrown from the motorcycle.  Catubig died on the
allegations did not bear out a case for illegal dismissal. spot where he was thrown, while Emperado died while
The alleged termination from employment was merely being rushed to the hospital.
presumed by the petitioners from their disagreement o Cabanilla was charged with reckless imprudence
with TWMPC when the latter announced its plans to resulting in double homicide before the MCTC
shift to a "pakyaw system" of compensation  Province of Negros Oriental.
o In fine, in the absence of justifiable and compelling o PI Resolution:  dismissing the criminal charge against
reasons, a liberal application of procedural rules is not Cabanilla.  It found that Cabanilla was not criminally
warranted in this case. liable for the deaths of Catubig and Emperado, because
 there was no negligence, not even contributory, on College Diploma dated March 24, 1983, the list and
Cabanilla's part. receipts of the expenses for Catubig's burial, the sketch
o Respondnet Jocelyn filed a complaint for damages of the collision site prepared by PO2 Elnas, the excerpts
against petitioner for the death of her husband from the police blotter, the photographs of the collision
o Petitioner is civilly liable because the latter's and the Post Mortem Report on Catubig's cadaver
employee driver, Cabanilla, was reckless and prepared by Dr. Baldado.
negligent in driving the bus which collided with o RTC: admitted all evidence of respondent
Catubig's motorcycle. Evidence of petitioner
o Petitioner: Proximate cause of the vehicular collision, o Maypa is the Administrative Assistnat (now manager)
which resulted in the deaths of Catubig and Emperado, at the Dumaguete branch of petitioner
was the sole negligence of Catubig when he o While he was still an Administrative Assistant,
imprudently overtook another vehicle at a curve Maypa was responsible for the hiring of
o Petitioner asked for the dismissal of personnel including drivers and conductors.
respondent's complaint for not being verified o Maypa further testified that the company
and/or for failure to state a cause of action, as employs a rigorous screening process for the
there was no allegation that petitioner was potential drivers they hire.
negligent in the selection or supervision of its o He admitted that at the time of his appointment
employee driver as Administrative Assistant at the Dumaguete
branch, Cabanilla was already an employee
Evidence of Respondent driver of petitioner.
o Investigation proper: PO2 Elnas conducted an o Maypa related that Cabanilla had been put on
investigation of the collision incident.  According to preventive suspension following the vehicular
PO2 Elnas, the bus was running fast, at a speed of 100 accident on January 27, 1994 involving the bus
kilometers per hour, when it collided w the motorcycle Cabanilla was driving and the motorcycle
o Cadimas personally witnessed the collision of carrying Catubig and Emperado
the bus and the motorcycle. Cadimas signaled o Following an internal investigation of said
the said bus to halt but it was running fast. accident conducted by petitioner, Cabanilla was
o A photographer who took photos of the incident, and declared not guilty of causing the same, for he
the doctor who’s conducted the post mortem had not been negligent.
examination of Catubig’s body was also presented. o RTC admitted evidence.
o Respondent's documentary exhibits consisted of her and o RTC: Proximate cause of the collision of the bus and
Catubig's Marriage Contract dated August 21, 1982, motorcycle was the negligence of the driver of the
their two children's Certificate of Live Births, Catubig's motorcycle, Catubig
 o Convinced through the testimony of Maypa, the that the allegations therein are true and correct
Administrative and Personnel Manager of the of her personal knowledge or based on authentic
Dumaguete branch of petitioner, that petitioner records."
had exercised due diligence in the selection and o Petitioner cited jurisprudence in which the Court
supervision of its employee drivers, including ruled that a pleading lacking proper verification
Cabanilla. is treated as an unsigned pleading, which
o CA:  Both Catubig and Cabanilla were negligent in produces no legal effect under Section 3, Rule 7
driving their respective vehicles.  of the Rules of Court.
o Catubig, on one hand, failed to use reasonable o At the outset, we find no procedural defect that would
care for his own safety and ignored the hazard have warranted the outright dismissal of respondent's
when he tried to overtake a truck at a curve. complaint.
o Cabanilla, on the other hand, was running his o Respondent filed her complaint for damages against
vehicle at a high speed of 100 kilometers per petitioner on July 19, 1995, when the 1964 Rules of
hour.  Court was still in effect
o Brushed aside the defense of petitioner that it o On July 1, 1997, the new rules on civil procedure took
exercised the degree of diligence exacted by law effect.  The foregoing provision was carried on, with a
in the conduct of its business. Maypa was not in few amendments, as Rule 7, Section 4 of the 1997
a position to testify on the procedures followed o The 1997 Rules of Court, even prior to its amendment
by petitioner in hiring Cabanilla as an employee by A.M. No. 00-2-10, clearly provides that a pleading
driver  lacking proper verification is to be treated as an
o Hence this R45 unsigned pleading which produces no legal effect. 
However, it also just as clearly states that except
ISSUE/S && RATIO when otherwise specifically required by law or rule,
WON the complaint for damages shall be dismissed pleadings need not be under oath, verified or
because of respondent’s failure to verify the same- NO. accompanied by affidavit." 
o No such law or rule specifically requires that
Lack of Verification is NOT jurisdictional. respondent's complaint for damages should have
o Petitioner: Respondent’s complaint for damages should been verified.
be dismissed for the latter's failure to verify the same.  o Although parties would often submit a joint verification
o The certification against forum shopping and certificate against forum shopping, the two are
attached to the complaint, signed by respondent, different
is not a valid substitute for respondent's o Pajuyov CA: A party's failure to sign the certification
verification that she "has read the pleading and against forum shopping is different from the party's
 failure to sign personally the verification.  The Rule 65, Sections 1 to 3; (13) petition for quo warranto under Rule
certificate of non-forum shopping must be signed by the 66, Section 1; (14) complaint for expropriation under Rule 67,
Section 1; (15) petition for indirect contempt under Rule 71,
party, and not by counsel. The certification of counsel Section 4, all from the 1997 Rules of Court; (16) all complaints or
renders the petition defective. petitions involving intra-corporate controversies under the Interim
o On the other hand, the requirement on Rules of Procedure on Intra-Corporate Controversies; (17)
verification of a pleading is a formal and not a complaint or petition for rehabilitation and suspension of payment
jurisdictional requisite.  It is intended simply to under the Interim Rules on Corporate Rehabilitation; and (18)
petition for declaration of absolute nullity of void marriages and
secure an assurance that what are alleged in the annulment of voidable marriages as well as petition for summary
pleading are true and correct and not the product proceedings under the Family Code.
of the imagination or a matter of speculation, o In contrast, all complaints, petitions, applications, and
and that the pleading is filed in good faith. The other initiatory pleadings must be accompanied by a
party need not sign the verification.  A party's certificate against forum shopping
representative, lawyer or any person who o It is not disputed herein that respondent's complaint for
personally knows the truth of the facts alleged in damages was accompanied by such a certificate.
the pleading may sign the verification o In addition, verification, like in most cases required by
o In the case before us, we stress that as a general rule, a the rules of procedure, is a formal, not jurisdictional,
pleading need not be verified, unless there is a law or requirement, and mainly intended to secure an
rule specifically requiring the same.  assurance that matters which are alleged are done in
o Examples of pleadings that require verification are: (1) all good faith or are true and correct and not of mere
pleadings filed in civil cases under the 1991 Revised Rules on
Summary Procedure; (2) petition for review from the Regional
speculation. 
Trial Court to the Supreme Court raising only questions of law o When circumstances warrant, the court may simply
under Rule 41, Section 2; (3) petition for review of the decision of order the correction of unverified pleadings or act on it
the Regional Trial Court to the Court of Appeals under Rule 42, and waive strict compliance with the rules in order that
Section 1; (4) petition for review from quasi-judicial bodies to the the ends of justice may thereby be served
Court of Appeals under Rule 43, Section 5; (5) petition for review
before the Supreme Court under Rule 45, Section 1; (6) petition for
annulment of judgments or final orders and resolutions under Rule ABBOT LABORATOPRIES v ALCARAZ
47, Section 4; (7) complaint for injunction under Rule 58, Section FACTS
4; (8) application for preliminary injunction or temporary o Abbott caused the publication in a major broadsheet
restraining order under Rule 58, Section 4; (9)  application for newspaper of its need for a Medical and Regulatory
appointment of a receiver under Rule 59, Section 1; (10)
application for support pendente lite under Rule 61, Section 1; (11)
Affairs Manager Regulatory Affairs Manager
petition for certiorari against the judgments, final orders or o Alcaraz - who was then a Regulatory Affairs and
resolutions of constitutional commissions under Rule 64, Section Information Manager at Aventis Pasteur Philippines,
2; (12) petition for certiorari, prohibition, and mandamus under
 Incorporated (another pharmaceutical company like o During the course of her employment, Alcaraz noticed
Abbott) – showed interest and submitted her application that some of the staff had disciplinary problems. Thus,
o Abbott formally offered Alcaraz the abovementioned she would reprimand them for their unprofessional
position which was an item under the company’s behavior such as non-observance of the dress code,
Hospira Affiliate Local Surveillance Unit (ALSU) moonlighting, and disrespect of Abbott officers.
department However, Alcaraz’s method of management was
o Abbott’s offer sheet it was stated that Alcaraz was to considered by Walsh to be "too strict."
be employed on a probationary basis o Alcaraz approached Misa to discuss these concerns and
o She accepted the said offer and received an electronic was told to "lie low" and let Walsh handle the matter.
mail (e-mail) from Abbott’s Recruitment Officer, Misa even assured her that Abbott’s HRD would
petitioner Teresita C. Bernardo (Bernardo), confirming support her in all her management decisions
the same. o Alcaraz was called to a meeting with Walsh and
o Alcaraz signed an employment contract which stated, Terrible (her former HR Director) where she was
inter alia, that she was to be placed on probation for a informed that she failed to meet the regularization
period of six (6) months standards for the position of Regulatory Affairs
o During Alcaraz’s pre-employment orientation, Manager.
petitioner Allan G. Almazar (Almazar), Hospira’s o Walsh and Terrible requested Alcaraz to tender her
Country Transition Manager, briefed her on her duties resignation, else they be forced to terminate her
and responsibilities as Regulatory Affairs Manager services. She was also told that, regardless of her
o Petitioner Maria Olivia T. Yabut-Misa (Misa), Abbott’s choice, she should no longer report for work and was
Human Resources (HR) Director, sent Alcaraz an e- asked to surrender her office identification cards. She
mail which contained an explanation of the procedure requested to be given one week to decide on the same,
for evaluating the performance of probationary but to no avail
employees and further indicated that Abbott had only o Alcaraz told her administrative assistant, Claude
one evaluation system for all of its employees Gonzales (Gonzales), that she would be on leave for
o Abbott’s PPSE procedure mandates that the job that day. However, Gonzales told her that Walsh and
performance of a probationary employee should be Terrible already announced to the whole Hospira ALSU
formally reviewed and discussed with the employee at staff that Alcaraz already resigned due to health reasons
least twice: first on the third month and second on the o Walsh, Almazar, and Bernardo personally handed to
fifth month from the date of employment. Alcaraz a letter stating that her services had been
o These performance standards should be discussed in terminated
detail with the employee within the first two (2) weeks o The letter detailed the reasons for Alcaraz’s termination
on the job – particularly, that Alcaraz: (a) did not manage her time
 effectively; (b) failed to gain the trust of her staff and to her work during her pre-employment orientation
build an effective rapport with them; (c) failed to train meeting and that she received copies of Abbott’s
her staff effectively; and (d) was not able to obtain the Code of Conduct and Performance Modules
knowledge and ability to make sound judgments on which were used for evaluating all types of
case processing and article review which were Abbott employees.
necessary for the proper performance of her duties. o NLRC: Annulled LA decision. Finding respondents
o Alcaraz felt that she was unjustly terminated from her Abbot and individual respondents to have committed
employment and thus, filed a complaint for illegal illegal dismissal
dismissal and damages against Abbott and its officers, o Immediately reinstate complainant to her former
namely, Misa, Bernardo, Almazar, Walsh, Terrible, and position without loss of seniority rights
Feist immediately and pay backwages
o She should have already been considered as a o No evidence showing that Alcaraz had been
regular and not a probationary employee given apprised of her probationary status and the
Abbott’s failure to inform her of the reasonable requirements which she should have complied
standards for her regularization upon her with in order to be a regular employee.
engagement as required under Article 295 of the o Abbott’s Code of Conduct and Performance
Labor Code Modules was not equivalent to her being
o while her employment contract stated that she actually informed of the performance standards
was to be engaged on a probationary status, the upon which she should have been evaluated on.
same did not indicate the standards on which her o Pending Resolution of the FIRST CA decision
regularization would be based. o Alcaraz moved for the execution of the NLRC’s
o Petitioners: Alcaraz was validly terminated from her Decision before the LA, which petitioners
probationary employment given her failure to satisfy strongly opposed.
the prescribed standards for her regularization which o LA Denied.
were made known to her at the time of her engagement o NLRC Reversed.
o LA: dismissed Alcaraz’s complaint for lack of merit. o Due to this, Petitioner filed SECOND certiorari with the
Termination of her probationary employment was CA assailing the propriety of the execution of the
justified NLRC decion
o CA 1st petition: affirmed the ruling of the NLRC and
o LA rejected Alcaraz’s argument that she was not held that the latter did not commit any grave abuse of
informed of the reasonable standards to qualify discretion in finding that Alcaraz was illegally
as a regular employee considering her dismissed.
admissions that she was briefed by Almazar on
 o It observed that Alcaraz was not apprised at the o Sps, Ong v CA: Compliance with the certification
start of her employment of the reasonable against forum shopping is separate from and
standards under which she could qualify as a independent of the avoidance of the act of forum
regular employee shopping itself. There is a difference in the treatment
o It also found that Abbott was unable to prove between failure to comply with the certification
that there was any reasonable ground to requirement and violation of the prohibition against
terminate Alcaraz’s employment forum shopping not only in terms of imposable
o MR Denied. sanctions but also in the manner of enforcing them.  
o CA 2nd petition: NLRC was correct in upholding the o Lack of Certification constitutes sufficient cause for the
execution of the NLRC Decision dismissal without prejudice to the filing of the
o MR complaint or initiatory pleading upon motion and after
o While the petitioners’ motion for reconsideration of the hearing
CA’s 2nd Resolution was pending, Alcaraz again moved o While the violation of the prohibition against forum
for the issuance of a writ of execution before the LA shopping is a ground for summary dismissal thereof and
o Petitoners through a Memorandum of Appeal stated that for direct contempt
the implementation of the LA’s order would render its o As to the first, forum shopping takes place when a
motion for reconsideration moot and academic litigant files multiple suits involving the same parties,
o Eventually, the MR was denied the 2 nd CA decision either simultaneously or successively, to secure a
attained finality for having failed to file an appeal. favorable judgment. It exists where the elements of litis
Hence, as it stands, only the issues in the First CA pendentia are present, namely: (a) identity of parties, or
petition are left to be resolved. at least such parties who represent the same interests in
both actions; (b) identity of rights asserted and relief
ISSUE/S && RATIO prayed for, the relief being founded on the same facts;
WON petitioners are guilty of forum shopping- NOT and (c) the identity with respect to the two preceding
GUILTY OF FORUM SHOPPING particulars in the two (2) cases is such that any
o Alcaraz: petitioners were guilty of forum shopping judgment that may be rendered in the pending case,
when they filed the 2nd CA Petition pending the regardless of which party is successful, would amount
resolution of their motion for reconsideration of the 1 st to res judicata in the other case
CA’s Decision o In this case, records show that, except for the element
o At the outset, it is noteworthy to mention that the of identity of parties, the elements of forum shopping
prohibition against forum shopping is different from a do not exist.
violation of the certification requirement under Section o Evidently, the First CA Petition was instituted to
5, Rule 7 of the Rules of Court question the ruling of the NLRC that Alcaraz was
 illegally dismissed. On the other hand, the Second CA o Records show that the issues raised in the instant
Petition pertains to the propriety of the enforcement of petition and those in the June 16, 2010 Memorandum of
the judgment award pending the resolution of the First Appeal filed with the NLRC likewise cover different
CA Petition and the finality of the decision in the labor subject matters and causes of action. In this case, the
dispute between Alcaraz and the petitioners. validity of Alcaraz’s dismissal is at issue whereas in the
o Based on the foregoing, a judgment in the Second CA said Memorandum of Appeal, the propriety of the
Petition will not constitute res judicata insofar as the issuance of a writ of execution was in question.
First CA Petition is concerned. o Thus, given the dissimilar issues, petitioners did not
o Thus, considering that the two petitions clearly have to disclose in the present petition the filing of their
cover different subject matters and causes of action, June 16, 2010 Memorandum of Appeal with the NLRC.
there exists no forum shopping. o In any event, considering that the issue on the propriety
of the issuance of a writ of execution had been resolved
WON petitioners violated the certification requirement in the Second CA Petition – which in fact had already
under Section 5, Rule 7 of the Rules of Court- NO attained finality – the matter of disclosing the June 16,
2010 Memorandum of Appeal is now moot and
Since the issues were dissimilar in both petitions, there was academic.
no obligation to disclose. Anyways, the 2nd resolution
already attained finality. MOOT. SPS SY v WESTMONT BANK
o Alcaraz: petitioners violated the certification FACTS
requirement under Section 5, Rule 7 of the Rules of o The present case stemmed from a Complaint for Sum of
Court by not disclosing the fact that it filed the June 16, Money, filed by respondent Westmont
2010 Memorandum of Appeal before the NLRC in the Bank (Westmont),  now United Overseas Bank
instant petition. Philippines (UOBP),  against petitioners Spouses
o In this regard, Section 5(b), Rule 7 of the Rules of Ramon Sy and Anita Ng, Richard Sy, Josie Ong,
Court requires that a plaintiff who files a case should William Sy, and Jackeline de Lucia (petitioners) before
provide a complete statement of the present status of the RTC
any pending case if the latter involves the same issues o Westmont alleged petitioners, doing business under the
as the one that was filed. If there is no such similar trade name of Moondrops General
pending case, Section 5(a) of the same rule provides Merchandising (Moondrops), obtained a loan in the
that the plaintiff is obliged to declare under oath that to amount of P2,429,500.00, evidenced by Promissory
the best of his knowledge, no such other action or claim Note
is pending.
o Barely a month after, petitioners obtained another loan o Petitioners insisted that their loan applications from
from Westmont Bank in the amount of P4,000,000.00, Westmont were denied and it was Chua who lent them
evidenced by another Promissory Note the money. Thus, they contended that Westmont could
o Disclosure Statements on the Loan/Credit not demand the payment of the said loans.
Transactionsw ere signed by the parties. Earlier, a o RTC: in favor of Westmont
Continuing Suretyship Agreement was executed o It held that Westmont's cause of action was
between Westmont and petitioners for the purpose of based on PN 5280 and PN 5285, the promissory
securing any future indebtedness of Moondrops. notes executed by petitioners
o Westmont averred that petitioners defaulted in the o Petitioners admitted the genuineness and due
payment of their loan obligations. execution of the said actionable documents
o It sent a Demand Letter, to petitioners, but it was because they failed to make a specific denial
unheeded. Hence, Westmont filed the subject in the answer.
complaint. o amon Sy never took any steps to have the
o Petitoners: Ramon Sy and Richard Sy applied for a promissory notes cancelled and annulled, which
loan with Westmont Bank, through its bank manager led to the conclusion that their obligations to
William Chu Lao (Lao).  Westmont were valid and binding
o According to them, Lao required them to sign o Petitioner’s MR: arguing that it had sufficiently denied
blank forms of promissory notes and disclosure the genuineness and due execution of the promissory
statements and promised that he would notify notes in their answer.
them immediately regarding the status of their o RTC repeated that petitioners were deemed to have
loan application admitted the genuineness and due execution of the
o Lao informed Ramon Sy and Richard Sy that their actionable documents
application was disapproved o CA: Affirmed RTC
o He, however, offered to help them secure a loan o It wrote that petitioners failed to specifically
through Amado Chua (Chua), who would lend deny the genuineness and due execution of the
them the amounts of P2,500,000.00 and promissory notes in their answer before the trial
P4,000,000.00, both payable within three (3) court.
months. o CA ruled that under Section 8, Rule 8 of the
o Ramon Sy and Richard Sy accepted Lao's offer and Rules of Court (Section 8 of Rule 8),  the
received the amounts of P2,429,500.00 and genuineness and due execution of the
P3,994,000.00 respectively, as loans from Chua. promissory notes were deemed admitted by
Petitioners claimed that they paid Chua the total amount petitioners. 
of their loans.
 o It added that the admission of the said o PDIC: CA correctly ruled that petitioners failed to
actionable documents created a prima facie case specifically deny the actionable documents in their
in favor of Westmont which dispensed with the answer and were deemed to have admitted the
necessity of presenting evidence that petitioners genuieness and due execution
actually received the loan proceeds. T o PDIC underscored that the specific denial meant
that the defendant must declare under oath that
ISSUE/S && RATIO he did not sign the document or that it was
WON CA erred when it ruled that Sps. Sy, for having otherwise false or fabricate
failed to specifically deny the actionable documents under o Whenever an action or defense is based upon a written
oath admitted to its genuineness and due execution- YES instrument or document, the substance of such
instrument or document shall be set forth in the
THERE WAS SUBSTAMNTIAL COMPLIANCE WITH pleading, and the original or a copy thereof shall be
R8S8. SC relaxed rules of procedure attached to the pleading as an exhibit, which shall be
o Petitioners argue that: they specifically denied the deemed to be a part of the pleading, or said copy may
allegations of Westmont under oath in their answer with like effect be set forth in the pleading
filed before the RTC o The said instrument or document is called an actionable
o although they signed blank forms of promissory document and Section 8 of Rule 8 provides the proper
notes, disclosure statements and continuing method for the adverse party to deny its genuineness
suretyship agreements, they were informed that and due execution
their loan application were denied these should o Accordingly, to deny the genuineness and due
be considered as sufficient compliance with execution of an actionable document: (1) there must be
Section 8 of Rule 8 a specific denial in the responsive pleading of the
o Westmont Bank failed to prove the existing loan adverse party; (2) the said pleading must be under oath;
obligations; and the original copy of the and (3) the adverse party must set forth what he claims
promissory notes were never presented in court. to be the facts
o This Court initially denied the petition for failure to o Failure to comply with the prescribed procedure results
show any reversible error in the challenged decision in the admission of the genuineness and due execution
and resolution of the CA. But granted Patitioner’s MR of the actionable document.
o In its Entry of Appearance with o The reason for the rule is to enable the adverse party to
Compliance/Manifestation, UOBP, formerly Westmont, know beforehand whether he will have to meet the issue
informed the Court that all their interests in the present of genuineness or due execution of the document during
litigated case were already transferred to the Philippine trial.
Deposit Insurance Corporation (PDIC).
o In fine, although Section 8 of Rule 8 provides for a o In particular, they alleged that although Ramon Sy and
precise method in denying the genuineness and due Richard Sy signed blank forms of promissory notes and
execution of an actionable document and the dire disclosure statements, they were later informed that
consequences of its non-compliance, it must not be their loans were not approved. Such disapproval led
applied with absolute rigidity. them to seek loans elsewhere, through Lao and Chua,
o What should guide judicial action is the principle but definitely not with the bank anymore
that a party-litigant is to be given the fullest o Verily, petitioners asserted throughout the entire
opportunity to establish the merits of his complaint proceedings that the loans they applied from Westmont
or defense rather than for him to lose life, liberty, were disapproved, and that they never received the loan
honor, or property on technicalities. proceeds from the bank.
o In the present case, the actionable documents attached o Stated differently, they insisted that the promissory
to the complaint of Westmont were PN 5280 and PN notes and disclosure statement attached to the
5285. The CA opined that petitioners failed to complaint were false and different from the
specifically deny the genuineness and due execution of documents they had signed. 
the said instruments because nowhere in their answer o These significant and consistent denials by petitioners
did they "specifically deny" the genuineness and due sufficiently informed Westmont beforehand that it
execution of the said documents. would have to meet the issue of genuineness or due
o After a judicious study of the records, the Court finds execution of the actionable documents during trial
that petitioners sufficiently complied with Section 8 of o Accordingly, petitioners substantially complied with
Rule 8 and grants the petition. Section 8 of Rule 8.
Petitioners specifically denied the genuineness and due o Although their answer did not indicate the exact words
execution of the promissory notes contained in the said provision, the questionable loans
o The answer of petitioner readily shows that they did not and the non-delivery of its proceeds compel the Court
spell out the words "specifically deny the genuineness to relax the rules of procedure in the present case.
and due execution of the promissory notes." o Law and jurisprudence grant to courts the prerogative to
o Nevertheless, when the answer is read as whole, it can relax compliance with procedural rules of even the most
be deduced that petitioners specifically denied the mandatory character, mindful of the duty to reconcile
paragraphs of the complaint regarding the both the need to put an end to litigation speedily and the
promissory notes. parties' right to an opportunity to be heard
o More importantly, petitioners were able to set forth
what they claim to be the facts, which is a crucial FILIPINAS TEXTILE v CA
element under Section 8 of Rule 8. FACTS
o State Investment House Inc. (SIHI) instituted obligation of Filtex to SIHI had been fully
a Complaint for the collection of the sum of settled.
₱3,118,949.75, with interest, penalties, exemplary o In order to ensure the payment of the sight drafts
damages, attorneys fees and costs of suit against herein aforementioned, Filtex executed and issued to SIHI
petitioners Filtex and Villanueva. several trust receipts covering the merchandise sold
o Because of Filtex's failure to pay its outstanding
o In its Complaint, SIHI alleged that sometime in 1983, obligation despite demand, SIHI filed a Complaint
Filtex applied for domestic letters of credit to finance praying that the petitioners be ordered to pay, jointly
the purchase of various raw materials for its textile and severally, the principal amount of ₱3,118,949.75,
business plus interest and penalties, attorney's fees, exemplary
o Finding the application to be in order, SIHI issued on damages, costs of suit and other litigation expenses.
various dates domestic letters of credit authorizing o Filtex: interposed special and affirmative
Indo-Philippine Textile Mills, Inc. ("Indo-Phil"), defenses, i.e., the provisions of the trust receipts, as
Texfiber Corporation ("Texfiber"), and Philippine well as the comprehensive surety agreement, do not
Polyamide Industrial Corporation ("Polyamide") "to reflect the true will and intention of the parties, full
value" on SIHI such drafts as may be drawn by said payment of the obligation, and lack of cause of action
corporations against Filtex o Villanueva: interposed the same special and affirmative
o Filtex used these domestic letters of credit to cover its defenses and added that the comprehensive surety
purchase of various textile materials from Indo-Phil, agreement is null and
Texfiber and Polyamide. o void and damages and attorney's fees are not legally
o Upon the sale and delivery of the merchandise, demandable.
Indo-Phil, Texfiber and Polyamide issued o The petitioners, however, failed to specifically deny
several sight draft payable to the order of SIHI under oath the genuineness and due execution of the
o Allegedly by way of inducement upon SIHI to issue the actionable documents upon which the Complaint was
aforesaid domestic letters of credit and "to value" the based.
sight drafts issued by Indo-Phil, Texfiber and o RTC: Filtex and Villanueva jointly and severally liable
Polyamide, Villanueva executed a comprehensive to SIHI.
surety agreement whereby he guaranteed, jointly and o Petitoners Appeal
severally with Filtex, the full and punctual payment at o Letters of credit, sight drafts, trust receipts and
maturity to SIHI of all the indebtedness of Filtex. comprehensive surety agreement upon which
o The essence of the comprehensive surety the Complaint is based are inadmissible in
agreement was that it shall be a continuing evidence supposedly because of non-payment of
surety until such time that the total outstanding
 documentary stamp taxes as required by the o Under Sec. 8, Rule 8 of the Rules of Court, when an
Internal Revenue Cod action or defense is founded upon a written instrument,
o CA:  debunked the petitioners' contention that the copied in or attached to the corresponding pleading as
letters of credit, sight drafts, trust receipts and provided in the preceding section, the genuineness and
comprehensive surety agreement are inadmissible in due execution of the instrument shall be deemed
evidence ruling that the petitioners had "in effect, admitted unless the adverse party, under oath,
admitted the genuineness and due execution of said specifically denies them, and sets forth what he claims
documents because of their failure to have their answers to be the facts.
placed under oath, the complaint being based on o Admission of the genuineness and due execution of a
actionable documents in line with Section 7, Rule 8 of document means that the party whose signature it bears
the Rules of Court." admits that he voluntarily signed the document or it was
signed by another for him and with his authority; that at
ISSUE/S && RATIO the time it was signed it was in words and figures
WON petitioners admitted to the genuineness of the exactly as set out in the pleading of the party relying
actionable documents for their failure to deny under the upon it; that the document was delivered; and that any
oath the genuineness- YES formalities required by law, such as a seal, an
acknowledgment, or revenue stamp, which it lacks, are
o Petitoners: Appellate court should not have admitted in waived by him.
evidence the letters of credit, sight drafts, trust receipts o As correctly pointed out by SIHI, Filtex was the issuer
and comprehensive surety agreement for lack of the and acceptor of the trust receipts and sight drafts,
requisite documentary stamps thereon. They respectively, while the letters of credit were issued upon
hypothesized that their implied admission of the its application. On the other hand, Villanueva signed
genuineness and due execution of these documents for the comprehensive surety agreement. Thus, being
failure to specifically deny the same under oath should among the parties obliged to pay the documentary
not be equated with an admission in evidence of the stamp taxes, the petitioners are estopped from claiming
documents and an admission of their obligation. that the documents are inadmissible in evidence for
o Answer with Counterclaim and answer of Filtex and non-payment thereof.
Villanueva, respectively, did not contain any specific o Interestingly, the petitioners questioned the
denial under oath of the letters of credit, sight drafts, admissibility of these documents rather belatedly, at the
trust receipts and comprehensive surety agreement upon appeal stage even.
which SIHI's Complaint was based, thus giving rise to o The rule is well-settled that points of law, theories,
the implied admission of the genuineness and due issues and arguments not adequately brought to the
execution of these documents. attention of the trial court need not, and ordinarily will
 not, be considered by a reviewing court as they cannot inspect the books and records of the business on
be raised for the first time on appeal because this would three occasions to no avail. 
be offensive to the basic rules of fair play, justice and o In a letter, Sy Tiong Shiou, et al. denied the
due process. request, citing civil and intra-corporate cases
o Hence, the petitioners can no longer dispute the pending in court
admissibility of the letters of credit, sight drafts, trust o In the two other complaints, Sy Tiong Shiou was
receipts and comprehensive surety agreement. charged with falsification and perjury
However, this does not preclude the petitioners from o Sy Tiong Shiou executed under oath the 2003
impugning these documents by evidence of fraud, General Information Sheet (GIS) wherein he
mistake, compromise, payment, statute of limitations, falsely stated that the shareholdings of the
estoppel and want of consideration. Spouses Sy had decreased despite the fact that
they had not executed any conveyance of their
SY TIONG v SY CHIM shares
FACTS o Sy Tiong Shiou, et al.: Issues involved in the civil case
o These consolidated petitions involving the same parties. for accounting and damages was a prejudicial question
although related, dwell on different issues. to the criinal complaints (hence, this should be
suspended)
Criminal. G.R. No. 174168. Filed by Sps. Sy o Investigating Prosecutor: issued a resolution
Violation of the Corporation Code Inspection of recommending:
books AND Violation of the RPC on falsification and o The suspension of the criminal complaints for
perjury) violation of the Corporation Code
o The dismissal of the criminal complaints for
o Four criminal complaints were filed Spouses Sy against falsification and perjury against Sy Tiong Shiou
Sy Tiong Shiou, et al before the City Prosecutor’s o This was approved by the Reviewing Prosecutor
Office in Manila o MR Denied. Pet. For Review before the DOJ, denied
o Two of the complaints, were for alleged violation of the resolution. Denied MR
Section 74 in relation to Section 144 of the Corporation o The Spouses Sy elevated the DOJ's resolutions to the
Code.  Court of Appeals through a R65 petition for certiorari,
o Spouses Sy averred that they are stockholders imputing grave abuse of discretion on the part of the
and directors of Sy Siy Ho & Sons, Inc. (the DOJ
corporation) who asked Sy Tiong Shiou, et al., o CA: Granted Petition.
officers of the corporation, to allow them to o Directed the City Prosecutor's Office to file the
appropriate informations against Sy Tiong
 Shiou, et al. of the Corporation Code and of the o SC: THE CIVIL CASE IS NOT A PREJUDICIAL
RPC.  QUESTION TO THE CRIMINAL CASE
o Civil case for accounting and damages cannot o As correctly found by the Court of Appeals, the DOJ
be deemed prejudicial to the maintenance or gravely abused its discretion when it suspended the
prosecution of a criminal action for violation hearing of the charges for violation of the Corporation
of the Corporation Code since a finding in the Code on the ground of prejudicial question and when it
civil case that respondents mishandled or dismissed the criminal complaints.
misappropriated the funds would not be o A prejudicial question comes into play generally in a
determinative of their guilt or innocence in the situation where a civil action and a criminal action are
criminal complaint.  both pending and there exists in the former an issue
o Criminal complaints for falsification and/or which must be preemptively resolved before the
perjury should not have been dismissed on the criminal action may proceed since howsoever the issue
ground of prejudicial question because the raised in the civil action is resolved would be
accounting case is unrelated and not necessarily determinative juris et de jure of the guilt or innocence
determinative of the success or failure of the of the accused in the criminal case.
falsification or perjury charges o The reason behind the principle of prejudicial question
o Court ordered the consolidation of G.R. No. 179438 is to avoid two conflicting decisions.
with G.R. No. 174168. o It has two essential elements: (a) the civil action
o Sy Tiong Shiou, et al.: findings of the DOJ in affirming, involves an issue similar or intimately related to the
modifying or reversing the recommendations of the issue raised in the criminal action; and (b) the resolution
public prosecutor cannot be the subject of such issue determines whether or not the criminal
of certiorari or review of the Court of Appeals action may proceed.
because the DOJ is not a quasi-judicial body within o The civil action for accounting and damages, Civil Case
the purview of Section 1, Rule 65 of the Rules of Court No. 03-106456 pending before the RTC Manila, Branch
o Adherence to the Court of Appeals' ruling that 46, seeks the issuance of an order compelling the
the accounting case is unrelated to, and not Spouses Sy to render a full, complete and true
necessarily determinative of the success of, the accounting of all the amounts, proceeds and fund paid
criminal complaint for falsification and/or to, received and earned by the corporation since 1993
perjury would unnecessarily indict petitioner Sy and to restitute it such amounts, proceeds and funds
Tiong Shiou for the said offenses he may not which the Spouses Sy have misappropriated
have committed but only because of an outcome o The criminal cases, on the other hand, charge that the
unfavorable to him in the civil action. Spouses Sy were illegally prevented from getting inside
company premises and from inspecting company
 records, and that Sy Tiong Shiou falsified the entries in Board of Directors stating that the control, supervision
the GIS, specifically the Spouses Sy's shares in the and administration of all corporate funds were exercised
corporation. by Spouses Sy, corporate president and assistant
o Surely, the civil case presents no prejudicial question to treasurer, respectively. 
the criminal cases since a finding that the Spouses Sy o Juanita Tan disclosed that Felicidad Chan Sy did
mishandled the funds will have no effect on the not make cash deposits to any of the
determination of guilt in the complaint for violation of corporation's banks thus the total bank
Section 74 in relation to Section 144 of the Corporation remittances for the past years were less than
Code reflected in the corporate financial statements,
o The civil case concerns the validity of Sy Tiong Shiou's accounting books and records
refusal to allow inspection of the records, while in the o The children of the Spouses Sy allegedly stole from the
falsification and perjury cases, what is material is the corporation cash, postdated checks and other important
veracity of the entries made by Sy Tiong Shiou in the documents.
sworn GIS o After the incident, the Spouses Sy allegedly transferred
o Anent the issue of probable cause, the Court also finds residence and ceased reporting to the corporation.
that there is enough probable cause to warrant the o Thereupon, the corporation filed a criminal complaint
institution of the criminal cases for robbery against the Spouses Sy before the City
o The Court agrees with the Court of Appeals' holding, Prosecutor's Office of Manila.
citing the case of Fabia v. Court of Appeals, that the o Sy Tiong Shiou, corporate Vice President and General
doctrine of primary jurisdiction no longer precludes the Manager, called a special meeting 3 to fill up the
simultaneous filing of the criminal case with the positions vacated by the Spouses Sy.
corporate/civil case o Sy Tiong Shiou was subsequently elected as the new
o Moreover, the Court finds that the City of Manila is the president and his wife, Juanita Tan, the new Vice
proper venue for the perjury charges, the GIS having President
been subscribed and sworn to in the said place.  o Meanwhile, the corporation, through Romer S. Tan,
filed its Amended Complaint for Accounting and
Criminal G. R. No. 179438.Filed by: Corporation against Damages against the Sps. Sy before then RTC Manila
Sps. Sy praying for a complete and true accounting of all the
(Violation of RPC on Robbery and Amended Complaint for amounts paid to, received and earned by the company
Accounting and Damages) since 1993 and for the restitution of the said amount.
o Sps Sy: Sy Chim was a mere figurehead and Felicidad
o Juanita Tan, treasurer of Sy Siy Ho & Sons, Inc. (the Chan Sy merely performed clerical functions, as it was
corporation), submitted a letter o the corporation's Sy Tiong Shiou and his spouse, Juanita Tan, who have
 been authorized by the corporation's by-laws to o The appellate court declared that a third-party
supervise, control and administer corporate funds, and complaint is not allowed under the Interim
as such were the ones responsible for the unaccounted Rules of Procedure Governing Intra-Corporate
funds Controversies Under R.A. No. 8799  it not being
o Assailed the meetings called by Sy Tiong Shiou included in
on the grounds that the same were held without o the exclusive enumeration of allowed pleadings under
notice to them and without their participation, in Section 2, Rule 2 thereof. 
violation of the by-laws. The Spouses Sy also o Respondent judge committed a manifest error
pursued their counter-claim for moral and amounting to lack of jurisdiction in admitting
exemplary damages and attorney's fees. the third-party complaint and in summarily
o Spouses Sy filed their Motion for Leave to File declaring Sy Tiong Shiou and Juanita Tan in
Third-Party Complaint, praying that their default for failure to file their answer within the
attached Third Party Complaint be allowed and purported reglementary period
admitted against Sy Tiong Shiou and his o The trial court was further ordered to dismiss
spouse.  the third-party complaint without prejudice to
o Spouses Sy accused Sy Tiong Shiou and Juanita any action that the corporation may separately
Tan as directly liable for the corporation's claim file against Sy Tiong Shiou and Juanita Tan.
for misappropriating corporate funds
o RTC: granted the motion for leave to file the third-party ISSUE/S && RATIO
complaint, and forthwith directed the issuance of WON the CA erred when it ruled that a 3 rd party complaint
summons against Sy Tiong Shiou and Juanita Tan is NOT allowed- YES
o Counsel allegedly discovered that Sy Tiong Shiou and
Juanita Tan were not furnished with the copies of THRID PARTY COMPLAINT SHOULD BE ALLOWED
several pleadings, as well as a court order, which o The conflicting provisions of the Interim Rules of
resulted in their having been declared in default for Procedure for Inter-Corporate Controversie
failure to file their answer to the third-party complaint o Rule 1, Sec. 8. Prohibited pleadings
o Thus, they opted not to file a motion for o Rule 2, Sec.2. Pleadings allowed
reconsideration anymore and instead filed a o There is a conflict, for while a third-party complaint is
petition for certiorari before the Court of not included in the allowed pleadings, neither is it
Appeals. among the prohibited ones.
o CA: Set aside RTC order admitting the 3rd party o evertheless, this conflict may be resolved by following
complaint the well-entrenched rule in statutory construction, that
every part of the statute must be interpreted with
 reference to the context, i.e., that every part of the complaint by the defendant against the third-party
statute must be considered together with the other parts, defendant.
and kept subservient to the general intent of the whole o Jurisprudence is consistent in declaring that the purpose
enactment. of a third-party complaint is to avoid circuitry of action
o Statutes, including rules, should be construed in the and unnecessary proliferation of law suits and of
light of the object to be achieved and the evil or disposing expeditiously in one litigation all the matters
mischief to be suppressed and they should be given arising from one particular set of facts.
such construction as will advance the object, suppress o It thus appears that the summary nature of the
the mischief and secure the benefits intended.  proceedings governed by the Interim Rules, and the
o Otherwise stated, the spirit, rather than the letter of a allowance of the filing of third-party complaints is
law determines its construction; hence, a statute, as in premised on one objective the expeditious disposition
the rules in this case, must be read according to its spirit of cases. 
and intent. o The logic and justness of this conclusion are rendered
beyond question when it is considered that Sy Tiong
o This spirit and intent can be gleaned from Sec. 3, Rule 1 Shiou and Juanita Tan are not complete strangers to the
of the Interim Rules, which reads: litigation as in fact they are the moving spirit behind the
filing of the principal complaint for accounting and
o Sec. 3. Construction. These Rules shall be damages against the Spouses Sy.ςηαñr
liberally construed in order to promote their o The Court also rules that the third-party complaint of
objective of securing a just, summary, speedy the Spouses Sy should be admitted.
and inexpensive determination of every action o A prerequisite to the exercise of such right is that some
or proceeding substantive basis for a third-party claim be found to
exist, whether the basis be one of indemnity,
o Now, a third-party complaint is a claim that a defending subrogation, contribution or other substantive right. The
party may, with leave of court, file against a person not bringing of a third-party defendant is proper if he would
a party to the action, called the third-party defendant, be liable to the plaintiff or to the defendant or both for
for contribution, indemnity, subrogation or any other all or part of the plaintiff's claim against the original
relief, in respect of his opponent's claim.  defendant, although the third-party defendant's liability
o It is actually a complaint independent of, and separate arises out of another transaction.
and distinct from the plaintiff's complaint. o The defendant may implead another as third-party
o In fact, were it not for Rule 6, Section 11 of the Rules defendant: (a) on an allegation of liability of the latter
of Court, such third-party complaint would have to be to the defendant for contribution, indemnity,
filed independently and separately from the original subrogation or any other relief; (b) on the ground of
 direct liability of the third-party defendant to the which the corporation interposed against the Spouses
plaintiff; or (c) the liability of the third-party defendant Sy. It is clear therefore that the Spouses Sy's third-party
to both the plaintiff and the defendant complaint is in respect of the plaintiff corporation's
o A third-party complaint must allege facts which prima claims, and thus the allowance of the third-party
facieshow that the defendant is entitled to contribution, complaint is warranted
indemnity, subrogation or other relief from the third-
party defendant. EQUITABLE v CAPISTRANO
o The complaint alleges that the Spouses Sy, as officers FACTS
of the corporation, have acted illegally in raiding its o Petitioner Equitable Cardnetwork, Inc. (ECI) alleged in
corporate funds, hence they are duty bound to render a its complaint that in respondent Josefa B. Capistrano
full, complete and true accounting of all the amounts, (Mrs. Capistrano) applied for membership at the Manila
proceeds and funds paid to, received and earned by the Yacht Club (MYC)
corporation since 1993 and to restitute to the o Since the MYC and ECI had a credit card sponsorship
corporation all such amounts, proceeds, and funds agreement in which the Club would solicit for ECI
which they took and misappropriated for their own use credit card enrollment among its members and
and benefit, to the damage and prejudice of the plaintiff dependents, Mrs. Capistrano allegedly applied for
and its stockholders. and was granted a Visa Credit Card by ECI.
o On the other hand, in the third-party complaint, the o ECI further alleged that Mrs. Capistrano authorized her
Spouses Sy claim that it is Sy Tiong Shiou and Juanita daughter, Valentina C. Redulla (Mrs. Redulla), to claim
Tan who had full and complete control of the day-to from ECI her credit card and ATM application form
day operations and complete control and custody of the o Mrs. Redulla signed the acknowledgment
funds of the corporation, and hence they are the ones receipt on behalf of her mother, Mrs.
liable for any shortfall or unaccounted difference of the Capistrano.
corporation's cash account. o After Mrs. Capistrano got hold of the card, she
o Thus, Sy Tiong Shiou and Juanita Tan should render a supposedly started using it.
full, complete and true accounting of all the amounts, o Mrs. Redulla personally issued a ₱45,000.00 check as
proceeds, funds paid to, received and earned by the partial payment of Mrs. Capistrano’s account with ECI.
corporation since 1993, including the amount attributed But Mrs. Redulla’s check bounced upon deposit.
to the Spouses Sy in the complaint for accounting and o Because Mrs. Capistrano was unable to settle her
damages.  ₱217,235.36 bill, ECI demanded payment from her. 
o The allegations in the third-party complaint impute o But she refused to pay, prompting ECI to file on
direct liability on the part of Sy Tiong Shiou and February 30, 1998 a collection suit against her before
Juanita Tan to the corporation for the very same claims RTC Cebu
o Mrs. Capistrano Answer: denied ever applying for o A mere statement that the documents were
MYC membership and ECI credit card procured by fraudulent representation does not
o That Mrs. Redulla was not her daughter; and raise any issue as to their genuineness and due
that she never authorized her or anyone to claim execution
a credit card for her o The RTC reasoned that she did not, in her
o Assuming she applied for such a card, she never verification, deny signing those documents or
used it. state that they were false or fabricat
o Mrs. Redulla posed as Mrs. Capistrano and o Mrs. Capistrano failed to present strong and
fooled ECI into issuing the card to her. convincing evidence that her signatures on the
o Mrs. Capistrano asked the court to hold ECI document had been forged
liable to her for moral and exemplary damages, o CA: Reversed the trial court’s decision and dismissed
attorney’s fees, and litigation expenses. ECI’s complaint.
o RTC: having failed to deny under oath the genuineness o Although Mrs. Capistrano’s answer was
and due execution of ECI’s actionable documents that somewhat infirm, still she raised the issue of the
were attached to the complaint, Mrs. Capistrano genuineness and due execution of ECI’s
impliedly admitted the genuineness and due execution documents during trial by presenting evidence
of those documents. that she never signed any of them.
o In effect she admitted: o Since ECI failed to make a timely objection to
o applying for membership at the MYC its admission, such evidence cured the
o accomplishing the MYC membership information sheet vagueness in her answer. Further, the CA ruled
which contained a request for an ECI Visa card that Mrs. Capistrano sufficiently proved by
o holding herself liable for all obligations incurred in the evidence that her signatures had been forged.
use of such card
o authorizing Mrs. Redulla to receive the Visa card issued ISSUE/S && RATIO
in her name; WON Mrs. Capistrano was able to make a specific denial of
o applying for an ATM Card with ECI;  the actionable documents attached to the complaint - YES
o using the credit card in buying merchandise worth
₱217,235.36 as indicated in the sales slips. The denial on the ground of “without sufficient knowledge”
o When an action is founded upon written made by Mrs. Caspistrano were insufficient
documents, their genuineness and due execution
shall be deemed admitted unless the defendant BUT STILL EFFECTIVELY MADE. Defect was cured by
specifically denies them under oath and states her quick assertion in her special and affirmative defenses
what he claims to be the facts. when she denied transactions with ECI.
 to be the facts; but the requirement of an oath does not
o CA was CORRECT in ordering dismissal. apply when the adverse party does not appear to be a
o There was no waiver by ECI by its failure to timely party to the instrument or when compliance with an
object to the evidence by Capistrano. order for an inspection of the original instrument is
o An answer to the complaint may raise a negative refused.
defense which consists in defendant’s specific denial of o ECI’s allegations: Mrs. Capistrano applied through
the material fact that plaintiff alleges in his complaint, Mrs. Redulla for a credit card and that the former used
which fact is essential to the latter’s cause of action it to purchase goods on credit yet Mrs. Capistrano
o Specific denial has three modes. Thus: refused to pay ECI for them.
o Mrs. Capistrano: Denied these allegations "for lack of
o The defendant must specify each material allegation knowledge" as to their truth.
of fact the truth of which he does not admit and o This mode of denial is by itself obviously ineffectual
whenever practicable set forth the substance of the since a person must surely know if he applied for a
matters on which he will rely to support his denial; credit card or not, like a person must know if he is
married or not.
o When the defendant wants to deny only a part or a o A person’s denial for lack of knowledge of things
qualification of an averment in the complaint, he must that by their nature he ought to know is not an
specify so much of the averment as is true and acceptable denial.
material and deny the remainder; and o In any event, the CA ruled that, since ECI did not object
on time to Mrs. Capistrano’s evidence that her
o When the defendant is without knowledge and signatures on the subject documents were forged, such
information sufficient to form a belief as to the truth of omission cured her defective denial of their genuineness
a material averment made in the complaint, he shall so and due execution. The CA’s ruling on this point is
state and this shall have the effect of a denial. quite incorrect
o True, issues not raised by the pleadings may be tried
o But the rule that applies when the defendant wants to with the implied consent of the parties as when one of
contest the documents attached to the claimant’s them fails to object to the evidence adduced by the
complaint which are essential to his cause of action is other concerning such unimpleaded issues.
found in Section 8, Rule 8 of the Rules of Court, which o But the CA fails to reckon with the rule that a party’s
provides admissions in the course of the proceedings, like an
o R8S8: xxx execution of the instrument shall be deemed admission in the answer of the genuineness and true
admitted unless the adverse party, under oath, execution of the plaintiff’s actionable documents, can
specifically denies them, and sets forth what he claims
 only be contradicted by showing that defendant made knowledge," it was her way of saying that such
such admission through palpable mistake. transactions took place without her knowing. 
o Here, Mrs. Capistrano never claimed palpable o And, since Mrs. Capistrano in fact verified her claim
mistake in the answer she filed. that she had no part in those transactions, she in effect
o It is of no moment that plaintiff ECI failed to object to denied under oath the genuineness and due execution of
Mrs. Capistrano’s evidence at the trial that the subject the documents supporting them. For this reason, she is
documents were forgeries not barred from introducing evidence that those
o Notwithstanding the above, the Court holds that the CA documents were forged.
correctly ordered the dismissal of ECI’s action since, o Evidence for the defense shows that it was not likely for
contrary to the RTC’s finding, Mrs. Capistrano Mrs. Capistrano to have applied for a credit card since
effectively denied the genuineness and due execution she was already 81 years old, weak, bedridden, and
of ECI’s actionable documents.  suffering from senility at the time in question
o True, Mrs. Capistrano denied ECI’s actionable o What is more, she had been staying in Cagayan
documents merely "for lack of knowledge" which de Oro under the care of his son Mario; whereas
denial, as pointed out above, is inadequate since by she made the alleged cash advances and
their nature she ought to know the truth of the purchases using the credit card in different malls
allegations regarding those documents. in Cebu City, Bohol, and Muntinlupa City
o But this inadequacy was cured by her quick
assertion that she was also denying the allegations PERMANENT SAVINGS v VALARDE
regarding those actionable documents "for the FACTS
reasons as stated in her special and affirmative o In a complaint for sum of money filed before the RTC
defenses." Manila petitioner Permanent Savings and Loan Bank
o In the "Special and Affirmative Defenses" section of sought to recover from respondent Mariano Velarde,
her answer, Mrs. Capistrano in fact denied ECI’s the sum of ₱1,000,000.00 plus accrued interests and
documented allegations that she applied for a credit penalties
card, was given one, and used it.  o This was based on a loan obtained by respondent from
o Neither the RTC nor the CA can ignore Mrs. petitioner bank, evidenced by the following: (1)
Capistrano’s above additional reasons denying ECI’s promissory note (2) loan release sheet and (3) loan
allegations regarding its actionable documents. Such disclosure statement
reasons form part of her answer. o Petitioner bank, represented by its Deputy Liquidator
o Parenthetically, it seems that, when Mrs. Capistrano after it was placed under liquidation, sent a letter of
denied the transactions with ECI "for lack of demand to respondent demanding full payment of the
loan.
 o Despite receipt of said demand letter,respondent failed already admitted these. Velarde had in fact denied these
to settle his account. in his responsive pleading. And consistent with his
o Another letter of demand was sent,and this time, denial, he objected to the presentation of Marquez as a
respondent’s counsel replied, stating that the obligation witness to identify the Exhibits of the Bank, and
"is not actually existing but covered by objected to their admission when these were offered as
contemporaneous or subsequent agreement between the evidence.
parties … o Though these were grudgingly admitted anyway,
o In his Answer, respondent disclaims any liability on the still admissibility of evidence should not be equated
instrument with weight of evidence
o Respondent filed a Demurer to Evidence o A reading of respondent’s Answer, however, shows that
o RTC: Granted demurer and dismissed the compliant respondent did not specifically deny that he signed the
o CA: Affirmed the dismissal of the complaint loan documents.
o Petitioner failed to present any evidence to o What he merely stated in his Answer was that the
prove the existence of respondent’s alleged loan signature appearing at the back of the promissory note
obligations, considering that respondent denied seems to be his. 
petitioner’s allegations in its complaint. o Respondent also denied any liability on the promissory
note as he allegedly did not receive the amount stated
ISSUE/S && RATIO therein, and the loan documents do not express the true
WON the CA erred in holding that petitioner failed to intention of the parties
establish the genuineness, due execution and authenticity of o Respondent reiterated these allegations in his
the subject loan documents- YES. "denial under oath," stating that "the promissory
note sued upon, assuming that it exists and bears
There was NO SPECIFIC DENIAL in respondent’s the genuine signature of herein defendant, the
answer. same does not bind him and that it did not
o The pertinent rule on actionable documents is found in truly express the real intention of the parties
Rule 8, Section 7 of the Rules of Court which provides as stated in the defenses
that when the cause of action is anchored on a o Respondent’s denials do not constitute an effective
document, the genuineness or due execution of the specific denial as contemplated by law.
instrument shall be deemed impliedly admitted unless o Songco vs. Sellner: defendant must declare under oath
the defendant, under oath, specifically denies them, and that he did not sign the document or that it is otherwise
sets forth what he claims to be the facts. false or fabricated.
o It is not true, as the Bank claims, that there is no need to
prove the loan and its supporting papers as Velarde has
o In fact, respondent’s allegations amount to an implied No further proof is necessary to show that he undertook
admission of the due execution and genuineness of the the obligation with petitioner. "A person cannot accept
promissory note. and reject the same instrument."
o The admission of the genuineness and due execution of
a document means that the party whose signature it ASIAN CONSTRUCTION v MENDOZA
bears admits that he voluntarily signed the document or FACTS
it was signed by another for him and with his authority; o Respondent Lourdes K. Mendoza, sole proprietor of
that at the time it was signed it was in words and figures Highett Steel Fabricators (Highett), filed before RTC
exactly as set out in the pleading of the party relying Caloocan a Complaint for a sum of money against
upon it; that the document was delivered; and that any petitioner Asian Construction and Development
formalities required by law, such as a seal, an Corporation
acknowledgment, or revenue stamp, which it lacks, are o Respondent alleged that petitioner purchased from
waived by him. Highett various fabricated steel materials and supplies
o Clearly, both the trial court and the Court of Appeals amounting to ₱1,206,177.00
erred in concluding that respondent specifically denied o Despite demand, petitioner failed and/or refused to pay;
petitioner’s allegations regarding the loan documents, and that due to the failure and/or refusal of petitioner to
as respondent’s Answer shows that he failed to pay the said amount, respondent was compelled to
specifically deny under oath the genuineness and engage the services of counsel.
due execution of the promissory note and its o Petitioner moved for a bill of particulars on the ground
concomitant documents. that no copies of the purchase orders and invoices were
o Therefore, respondent is deemed to have admitted the attached to the complaint to enable petitioner to prepare
loan documents and acknowledged his obligation with a responsive pleading to the complaint.
petitioner; and with respondent’s implied admission, it o RTC: Denied
was not necessary for petitioner to present further o Accordingly, petitioner filed its Answer with
evidence to establish the due execution and authenticity Counterclaim denying liability for the claims and
of the loan documents sued upon. interposing the defense of lack of cause of action
o Respondent claims that he did not receive the net o RTC: ruled in favor of Respondent Highett.
proceeds in the amount of ₱988,333.00 as stated in the Ordering Petitioner Asian to pay
Loan Release Sheet dated September 23, 1983. o CA: Affirmed with modification the Decision of the
o The document, however, bears respondent’s signature RTC
as borrower. Res ipsa loquitur
o Respondent has already impliedly admitted the ISSUE/S && RATIO
genuineness and due execution of the loan documents. WON the charge invoices are actionable documents- NO
 o In fact, respondent’s cause of action is not based on
Respondent Highett wins. Even if the documents are not these documents but on the contract of sale between the
actionable documents, preponderance of evidence shows parties.
that supplies and materials were delivered to petitioner o But although the Charge Invoices are not actionable
Corporation documents, we find that these, along with the Purchase
Orders are sufficient to prove that petitioner indeed
o Petitioner Asian Construction: charge or sales invoice is ordered supplies and materials from Highett and that
not an actionable document; thus, petitioner’s failure to these were delivered to petitioner.
deny under oath its genuineness and due execution does
not constitute an admission thereof. o In this case, except for a bare denial, no other evidence
o Respondent was not able to prove her claim as was presented by petitioner to refute respondent’s
the invoices offered as evidence were not claim. Thus, we agree with the CA that the evidence
properly authenticated by her witnesses. preponderates in favor of respondent.
o Respondent Highett: Charge invoices are actionable
documents PTA OF ST. MATHEWS v METRO BANK
o The charge invoices are not actionable documents FACTS
o SEC. 7 R8. Action or defense based on document. – o Spouses Ilagan applied for and were granted a loan by
Whenever an action or defense is based upon a written the Metropolitan Bank and Trust
instrument or document, the substance of such Co₱4,790,000.00secured by a Real Estate Mortgage
instrument or document shall be set forth in the over the parcels of land
pleading, and the original or a copy thereof shall be o Upon default, an extrajudicial foreclosure was
attached to the pleading as an exhibit, which shall be conducted with Metropolitan Bank and Trust Co being
deemed to be a part of the pleading, or said copy may the highest bidder and for which a Certificate of Sale
with like effect be set forth in the pleading. was issued in its favor.
o A document is actionable when an action or defense is o During the period of redemption, the respondent Bank
grounded upon such written instrument or document filed an Ex-Parte Petition for Issuance of a Writ of
o In the instant case, the Charge Invoices are not Possession by posting the required bond which was
actionable documents per se as these "only provide subsequently approved
details on the alleged transactions." o St. Mathew Christian Academy of Tarlac, Inc. filed a
o These documents need not be attached to or stated in Petition for Injunction with Prayer for Restraining
the complaint as these are evidentiary in nature Order  against the respondent Bank and the Provincial
Sheriff of Tarlac.
o RTC: Metropolitan Bank is now entitled to a writ of o Petitioners filed a Patition for Certiorari and Prohibition
possession, it being mandatory even during the period o CA: Dismissed
of redemption. o Considering that in this case the writ of
o St. Mathew Christian: filed the petition for injunction possession had already been issued petitioners’
on the ground that it cannot be ejected being a third remedy was to file a petition that the sale be set
party. aside and the writ of possession cancelled.
o St. Mathew Christian Academy is practically Instead, petitioners filed the instant Petition
owned by the mortgagors, spouses Denivin and for Certiorari.
Josefina Ilagan. 
o St. Mathew Christian Academy is practically ISSUE/S && RATIO
owned by the mortgagors, spouses Denivin and WON petitioners are THIRD PARTIES against whom no
Josefina Ilagan. Firstly, the lease to St. Mathew writ of possession may be issued against- NO
by the Ilagans, as lessor, was for a period of one
year from the execution  o Petitioners are not "Third Parties" against whom the
o Secondly, the lease was not registered and writ of possession cannot be issued and implemented.
annotated at the back of the title, and therefore, o In this case, we find that petitioners’ right over the
not binding on third persons foreclosed property is not adverse to that of the
o Thirdly, the spouses are the owners or judgment debtor or mortgagor. As such, they cannot
practically the owners of St. Mathew. Even if it seek the quashal or prevent the implementation of the
has a separate personality, nevertheless, writ of possession
"piercing the veil of corporate entity"  o Section 7 of Act No. 3135 explicitly authorizes the
o Pending resolution of the motion for reconsideration of purchaser in a foreclosure sale to apply for a writ of
the said Joint Decision, herein petitioners Parents- possession during the redemption period by filing an ex
Teachers Association (PTA) who are teachers and parte motion under oath for that purpose "in the
students of SMCA, filed a Motion for Leave to file registration or cadastral proceedings if the property is
Petition in Intervention registered, or in special proceedings in the case of
o Trial court reversed its earlier Order by ruling that property registered under the Mortgage Law" with the
petitioners’ intervention would have no bearing on the Regional Trial Court of the province or place where the
issuance and implementation of the writ of possession.  real property or any part thereof is situated, in the case
o Thus, it directed that the writ be implemented by of mortgages duly registered with the Registry of
placing respondent Metropolitan Bank and Trust Deeds.
Company (MBTC) in physical possession of the o Upon filing of such motion and the approval of the
property corresponding bond, the law also directs in express
 terms the said court to issue the order for a writ of current school premises does not prevent the SMCA
possession. from continuing its operations elsewhere.
o Exception: Barican v IAC obligation of a court to issue o At this point, it is relevant to note that in the Joint
an ex parte writ of possession in favor of the purchaser Decision dated August 16, 2005, the trial court found
in an extrajudicial foreclosure sale ceases to be that SMCA was not a third party and was therefore
ministerial once it appears that there is a third party in bound by the said writ of possession
possession of the property who is claiming a right o MBTC thus correctly argued that petitioners did not
adverse to that of the debtor/mortgagor. have superior rights to that of SMCA over the subject
o Ordinarily, a purchaser of property in an extrajudicial property because their supposed possession of the same
foreclosure sale is entitled to possession of the property. emanated only from the latte
Thus, whenever the purchaser prays for a writ of o Since petitioners’ possession of the subject school
possession, the trial court has to issue it as a matter of premises stemmed from their employment or
course. enrollment contracts with the school, as the case may
o However, the obligation of the trial court to issue a writ be, necessarily, their right to possess the subject school
of possession ceases to be ministerial once it appears premises cannot be adverse to that of the school and of
that there is a third party in possession of the property its owners.
claiming a right adverse to that of the debtor/mortgagor. o As such, the petitioners cannot be deemed "third
o Where such third party exists, the trial court should parties" as contemplated in Act No. 3135, as amended.
conduct a hearing to determine the nature of his adverse
possession WON the lack of authority to sign the certificate of Non
o In this case, we find that petitioners cannot be Forum Shopping attached to the Petition for Issuance of
considered as third parties because they are not Writ of Possession should be considered as not being filed
claiming a right adverse to the judgment debtor. at all- NO
o Petitioner-teachers and students did not claim
ownership of the properties, but merely averred actual Certificate of Non Forum Shopping mandatory only for
"physical possession of the subject school premises" INITIATORY PLEADINGS.
o As such, it would be specious to conclude that the o The lack of authority to sign the certificate of non-
teachers and students hold the subject premises forum shopping attached to the Petition for Issuance of
independent of or adverse to SMCA Writ of Possession was an insignificant lapse.
o In fact, their interest over the school premises is o Petitioners: lack of authority to sign the certificate on
necessarily inferior to that of the school. Besides, their non-forum shopping attached to the Petition for the
contracts are with the school and do not attach to the Issuance of the Writ of Possession rendered the same
school premises. Moreover, the foreclosure of the worthless and should be deemed as non-existent
o MBTC: application for a writ of possession is a mere
incident in the registration proceeding which is in FUJI TELEVISION v ESPIRITU
substance merely a motion, and therefore does not FACTS
require such a certification. o Arlene S. Espiritu ("Arlene") was engaged by Fuji
o It bears stressing that a certification on non-forum Television Network, Inc. ("Fuji") asa news
shopping is required only in a complaint or a petition correspondent/produce
which is an initiatory pleading. o Arlene’s employment contract initially provided
o In this case, the subject petition for the issuance of a for a term of one (1) year but was successively
writ of possession filed by private respondent is not an renewed on a yearly basis with salary
initiatory pleading.  adjustment upon every renewal
o Although private respondent denominated its pleading o Sometime in January 2009, Arlenewas diagnosed with
as a petition, it is more properly a motion. lung cancer
o What distinguishes a motion from a petition or other o She informed Fuji about her condition. In turn, the
pleading is not its form or the title given by the party Chief of News Agency of Fuji, Yoshiki Aoki, informed
executing it, but its purpose. Arlene "that the company will have a problem renewing
o The purpose of a motion is not to initiate litigation, but her contract
to bring up a matter arising in the progress of the case o Arlene and Fuji signed a non-renewal contract where it
where the motion is filed was stipulated that her contract would no longer be
o It is not necessary to initiate an original action in order renewed after its expiration
for the purchaser at an extrajudicial foreclosure of real o In consideration of the non-renewal contract, Arlene
property to acquire possession. "acknowledged receipt of the total amount of
o Even if the application for the writ of possession was US$18,050.00 representing her monthly salary from
denominated as a "petition", it was in substance merely March 2009 to May 2009
a motion. o However, Arlene affixed her signature on the
o Indeed, any insignificant lapse in the certification on nonrenewal contract with the initials "U.P." for "under
non-forum shopping filed by the MBTC did not render protest."
the writ irregular. After all, no verification and o The day after Arlene signed the non-renewal contract,
certification on non-forum shopping need be attached to she filed a complaint for illegal dismissal with NLRC
the motion. o Alleged that she was forced to sign the
o Hence, it is immaterial that the certification on non- nonrenewal contract when Fuji came to know of
forum shopping in the MBTC’s petition was signed by her illness and that Fuji withheld her salaries
its branch head. Such inconsequential oversight did not and other benefits when she refused to sign
render the said petition defective in form.
 o LA: Dismissed the complaint, applying the 4 fold test, authority to sign the verification and certification on behalf
Arlene was not a regular employee but an independent of Fuji- NO. THERE WAS SUBSTANRTIAL
contractor COMPLAINCE
o NLRC: Reversed LA.
o Arlene was a regular employee with respect to o Fuji: Corazon was authorized to sign the verification
the activities for which she was employed since and certification of non-forum shopping because Mr.
she continuously rendered services that were Shuji Yano was empowered under the secretary’s
deemednecessary and desirable to Fuji’s certificate to delegate his authority to sign the
business necessary pleadings, including the verification and
o Petition for Revoew filed by Fuji certification against forum shopping
o Fuji: Arlene was hired as a stringer, and it informed her o Arlene: the authority given to Mr. Shuji Yano and Mr.
that she would remain one. Jin Eto in the secretary’s certificate is only for the
o She was hired as an independent contractor and petition for certiorari before the Court of Appeals
it had no control over her work. o Fuji did not attach any board resolution
o CA:  Arlene was a regular employee because she was authorizing Corazon or any other person to file a
engaged to perform work that was necessary or petition for review on certiorari with this court.
desirable in the business of Fuji o Shuji Yano and Jin Eto could not re-delegate the
o Arlene was illegally dismissed because Fuji power that was delegated to them
failed to comply with the requirements of o The special power of attorney executed by Shuji
substantive and procedural due process Yano in favor of Corazon indicated that she was
necessary for her dismissal since she was a empowered to sign on behalf of Shuji Yano, and
regular employee. not on behalf of Fuji
o Fuji filed Petition for review on certiorari under Rule 45 o Section 4(e) of Rule 45 requires that petitions for
was filed review should "contain a sworn certification against
o Arlene filed a manifestation: stating that this court may forum shopping as provided in the last paragraph of
not take jurisdiction over the case since Fuji failed to section 2, Rule 42."
authorize Corazon E. Acerden to sign the verification. o Section 5 of the same rule provides that failure to
(office manager and resident interpreter) comply with any requirement in Section 4 is sufficient
ground to dismiss the petition
ISSUE/S && RATIO o Effect of non compliance. Uy v Landbank: The
WON petition for review should be dismissed as Corazon requirement regarding verification of a pleading is
E. Acerden, the signatory of the verification and formal, not jurisdictional. Such requirement is simply a
certification of non forum shopping of the petition, had no condition affecting the form of pleading, the non-
 compliance of which does not necessarily render the o A distinction must be made between non-compliance
pleading fatally defective. Verification is simply with the requirement on or submission of defective
intended to secure an assurance that the allegations in verification, and noncompliance with the requirement
the pleading are true and correct and not the product of on or submission of defective certification against
the imagination or a matter of speculation, and that the forum shopping.
pleading is filed in good faith. The court may order the
correction of the pleading if the verification is lacking o As to verification, non-compliance therewith or a defect
or act on the pleading although it is not verified, if the therein does not necessarily render the pleading fatally
attending circumstances are such that strict compliance defective. The court may order its submission or
with the rules may be dispensed with in order that the correction or act on the pleading if the attending
ends of justice may thereby be served. circumstances are such that strict compliance with the
o On the other hand, the lack of certification against Rule may be dispensed with in order that the ends of
forum shopping is generally not curable by the justice may be served thereby.
submission thereof after the filing of the petition
o Section 5, Rule 45 of the 1997 Rules of Civil Procedure o Verification is deemed substantially complied with
provides that the failure of the petitioner to submit the when one who has ample knowledge to swear to the
required documents that should accompany the petition, truth of the allegations in the complaint or petition signs
including the certification against forum shopping, shall the verification, and when matters alleged in the
be sufficient ground for the dismissal thereof.  petition have been made in good faith or are true and
o The same rule applies to certifications against forum correct.
shopping signed by a person on behalf of a corporation
which are unaccompanied by proof that said signatory o As to certification against forum shopping, non-
is authorized to file a petition on behalf of the compliance therewith or a defect therein, unlike in
corporation. verification, is generally not curable by its subsequent
o Although the general rule is that failure to attach a submission or correction thereof, unless there is a need
verification and certification against forum shopping is to relax the Rule on the ground of "substantial
a ground for dismissal, there are cases where this court compliance" or presence of "special circumstances or
allowed substantial compliance. compelling reasons."

o GUIDELINES: respecting non-compliance with the o The certification against forum shopping must be
requirement on, or submission of defective, verification signed by all the plaintiffs or petitioners in a case;
and certification against forum shopping: otherwise, those who did not sign will be dropped as
parties to the case. Under reasonable or justifiable
 circumstances, however, as when all the plaintiffs or o This court has recognized that there are instances when
petitioners share a common interest and invoke a officials or employees of a corporation can sign the
common cause of action or defense, the signature of verification and certification against forum shopping
only one of them inthe certification against forum without a board resolution.
shopping substantially complies with the Rule. o In sum, we have held that the following officials or
employees of the company can sign the verification and
o Finally, the certification against forum shopping must certification without need of a board resolution: (1) the
be executed by the party-pleader, not by his counsel. If, Chairperson of the Board of Directors, (2) the President
however, for reasonable or justifiable reasons, the of a corporation, (3) the General Manager or Acting
party-pleader is unable to sign, he must execute a General Manager, (4) Personnel Officer, and (5) an
Special Power of Attorney designating his counsel of Employment Specialist in a labor case.
record to sign on his behalf. o While the above cases do not provide a complete listing
of authorized signatories to the verification and
o Being a corporation, Fuji exercises its power to sue and certification required by the rules, the determination of
be sued through its board of directors or duly authorized the sufficiency of the authority was done on a case to
officers and agents. Thus, the physical act of signing the case basis.
verification and certification against forum shopping o The rationale applied in the foregoing cases is to justify
can only be done by natural persons duly authorized the authority of corporate officers or representatives of
either by the corporate by-laws or a board resolution the corporation to sign the verification or certificate
o In its petition for review on certiorari, Fuji attached against forum shopping, being ‘in a position to verify
Hideaki Ota’s secretary’s certificate, authorizing Shuji the truthfulness and correctness of the allegations in the
Yano and Jin Eto to represent and sign for and on petition.
behalf of Fuj o Corazon’s affidavit states that she is the "office
o Likewise attached to the petition is the special power of manager and resident interpreter of the Manila Bureau
attorney executed by Shuji Yano, authorizing Corazon of Fuji Television Network, Inc." and that she has
to sign on his behalf. "held the position for the last twenty-three years
o The verification and certification against forum o As the office manager for 23 years, Corazon can be
shopping was signed by Corazon considered as having knowledge of all matters in Fuji’s
o The secretary’s certificate does not state that Shuji Manila Bureau Office and is in a position to verify "the
Yano is prohibited from appointing a substitute. In fact, truthfulness and the correctness of the allegations in the
he is empowered to do acts that will aid in the Petition."
resolution of this case. o Thus, Fuji substantially complied with the requirements
of verification and certification against forum shopping.
 o When a decision of the Court of Appeals under a Rule
PRORIETY OF PETITIONS FOR REVIEW IN LABOR 65 petition is brought to this court by way of a petition
CASES for review under Rule 45, only questions of law may be
decided upon
o Article 223 of the Labor Code does not provide any o This Court is not a trier of facts. Well-settled is the rule
mode of appeal for decisions of the National Labor that the jurisdiction of this Court in a petition for review
Relations Commission. on certiorari under Rule 45 of the Revised Rules of
o However, the finality of the National Labor Relations Court is limited to reviewing only errors of law, not of
Commission’s decisions does not mean that there is no fact, unless the factual findings complained of are
more recourse for the parties. completely devoid of support from the evidence on
o In St. Martin Funeral Home v. National Labor Relations record, or the assailed judgment is based on a gross
Commission, this court cited several cases and rejected misapprehension of facts. Besides, factual findings of
the notion that this court had no jurisdiction to review quasi-judicial agencies like the NLRC, when affirmed
decisions of the National Labor Relations Commission. by the Court of Appeals, are conclusive upon the parties
o This court then clarified that judicial review of National and binding on this Court
Labor Relations Commission decisions shall be by way o In a Rule 45 review, we consider the correctness of the
of a petition for certiorari under Rule 65 w the CA, assailed CA decision, in contrast with the review for
citing hierarchy of courts jurisdictional error that we undertake under Rule 65.
o From the Court of Appeals, an aggrieved party may file Furthermore, Rule 45 limits us to the review of
a petition for review on certiorari under Rule 45. questions of law raised against the assailed CA decision
o A petition for certiorari under Rule 65 is an original o If the NLRC ruling has basis in the evidence and the
action where the issue is limited to grave abuse of applicable law and jurisprudence, then no grave abuse
discretion. As an original action, it cannot be of discretion exists and the CA should so declare and,
considered as a continuation of the proceedings of the accordingly, dismiss the petition.
labor tribunals o If grave abuse of discretion exists, then the CA must
o A petition for review on certiorari under Rule 45 is a grant the petition and nullify the NLRC ruling, entering
mode of appeal where the issue is limited to questions at the same time the ruling that is justified under the
of law.  evidence and the governing law, rules and
o In labor cases, a Rule 45 petition is limited to reviewing jurisprudence. In our Rule 45 review, this Court must
whether the Court of Appeals correctly determined the deny the petition if it finds that the CA correctly acted
presence or absence of grave abuse of discretion and
deciding other jurisdictional errors of the National
Labor Relations Commission.
 o Used the Pacaña family’s receipts and the
deliveries and sales were made to appear as
those of the respondent Rovila Inc. 
o Petitioners filed the complaint in their own names
PACANA V ROVILA WATER SUPPLY although Rosalie was authorized by Lourdes through a
sworn declaration and special power of attorney (SPA)
FACTS o Respondents filed a first motion to dismiss on the
ground that the RTC had no jurisdiction over an intra-
o Petitioners Rebecca Pacaña-Contreras and Rosalie corporate controversy
Pacaña, children of Lourdes Teves Pacaña and Luciano o At the subsequent pre-trial, the respondents manifested
Pacaña, filed the present case against Rovila Inc., Earl, to the RTC that a substitution of the parties was
Lilia, Dalla and Marisa for accounting and damages necessary in light of the deaths of Lourdes and Lucian
o Petitioners: their family has long been known in the o That they would seek the dismissal of the
community to be engaged in the water supply business; complaint because the petitioners are not the
o They operated the "Rovila Water Supply" from real parties in interest to prosecute the case.
their family residence and were engaged in the o RTC Pre-trial Order: one of the issues submitted was
distribution of water to customers in Cebu City. whether the complaint should be dismissed for failure
o The petitioners alleged that Lilia was a former trusted to comply with Section 2, Rule 3 of the Rules of Court
employee in the family business who hid business which requires that every action must be prosecuted in
records and burned and ransacked the family files. the name of the real party in interest
o Lilia also allegedly posted security guards and o Respondent: again filed an MTD. Petitioners are not the
barred the members of the Pacaña family from real parties in interest, that they have no valid cause of
operating their business action against respondents
o She then claimed ownership over the family business o RTC: denied the MTD for having been filed out of time
through a corporation named "Rovila Water Supply, (after filing of the aanswer).
Inc." (Rovila Inc.)  o Save for the grounds for dismissal which may
o Upon checking with SEC the petitioners claimed that be raised at any stage of the proceedings, the
Rovila Inc. was surreptitiously formed with the motion to dismiss based on the grounds invoked
respondents as the majority stockholders. by the respondents may only be filed within the
o In forming the respondent corporation, the respondents time for, but before, the filing of their answer to
allegedly used the name of Lourdes as one of the the amended complaint
incorporators and made it appear in the SEC documents o Thus, even granting that the defenses invoked
that the family business was operated by the respondents are meritorious, their motion
 was filed out of time as it was filed only after o In denying the motion to dismiss, the RTC judge
the conclusion of the pre-trial conference. acted contrary to established rules and
o Respondents filed a petition for certiorari under Rule 65 jurisprudence which may be questioned via a
of the Rules of Court with the CA invoking GAD in the petition for certiorari.
dismissal of their MTD o Petitioners: CA unjustly allowed the motion to dismiss
o Deceased spouses Luciano and Lourdes, not the which did not conform to the rules.
petitioners, were the real parties in interest o Specifically, the motion was not filed within the
o Furthermore, they seasonably moved for the time for, but before the filing of, the answer to
dismissal of the case and the RTC never the amended complaint, nor were the grounds
acquired jurisdiction over the persons of the raised in the answer.
petitioners as heirs of Lourdes and Luciano o Citing Section 1, Rule 9 of the Rules of Court,
o CA: Granted.  RTC committed grave abuse of the respondents are deemed to have waived
discretion as the petitioners filed the complaint and the these grounds, as correctly held by the RTC
amended complaint as attorneys-in-fact of their parents o Respondents: Argued that they moved for the dismissal
o Petitioners are not the real parties in interest and of the case during the pre-trial conference due to the
cannot bring an action in their own names. petitioners’ procedural lapse in refusing to comply with
Petitioners should first be declared as heirs a condition precedent, which is, to substitute the heirs
before they can be considered as the real parties as plaintiffs. Besides, an administrator of the estates of
in interest.  Luciano and Lourdes has already been appointed
o The CA agreed with the respondents that they o Grounds invoked in their motion to dismiss
alleged the following issues as affirmative were timely raised, pursuant to Section 2,
defenses in their answer: 1) the petitioners are paragraphs g and i, Rule 18 of the Rules of
not the real parties in interest; and 2) that they Court. 
had no legal right to institute the action in behalf
of their parents. ISSUE/S && RATIO
o That the motion to dismiss was filed after the WON Respondent’s MTD was timely filed- NO
period to file an answer has lapsed is of no
moment. The CA was incorrect and used as basis the old 1940 and
o In denying the motion to dismiss, the RTC judge 1964 ROC where the ground of failure to state COA could
acted contrary to established rules and be raised at any time
jurisprudence which may be questioned via a o Petition for certiorari under Rule 65 is a proper remedy
petition for certiorari. for a denial of a motion to dismiss attended by grave
abuse of discretion
o Barrazona v RTC Court held that while an order o Thus, jurisprudence governed by the 1940 and 1964
denying a motion to dismiss is interlocutory and non- Rules of Court to the effect that the ground for
appealable, certiorari and prohibition are proper dismissal based on failure to state a cause of action may
remedies to address an order of denial made without or be raised anytime during the proceedings, is already
in excess of jurisdiction. inapplicable to cases already governed by the present
Rules of Court which took effect on July 1, 1997. As
o Under the present Rules of Court, this provision was the rule now stands, the failure to invoke this ground in
reflected in Section 1, Rule 9, and we quote: a motion to dismiss or in the answer would result in its
waiver.
o Section 1. Defenses and objections not pleaded. — o The motion to dismiss in the present case based on
Defenses and objections not pleaded either in a motion failure to state a cause of action was not timely filed
to dismiss or in the answer are deemed waived. and was thus waived
However, when it appears from the pleadings or the o Applying Rule 16 of the Rules of Court which provides
evidence on record that the court has no jurisdiction for the grounds for the dismissal of a civil case, the
over the subject matter, that there is another action respondents’ grounds for dismissal fall under Section
pending between the same parties for the same cause, or 1(g) and (j), Rule 16 of the Rules of Court, particularly,
that the action is barred by a prior judgment or by failure to state a cause of action and failure to comply
statute of limitations, the court shall dismiss the claim. with a condition precedent (substitution of parties),
respectively
o Notably, in the present rules, there was a deletion of the o Rule 16 of the Rules of Court provides for the period
ground of "failure to state a cause of action" from the within which to file a motion to dismiss under the
list of those which may be waived if not invoked either grounds enumerated. Specifically, the motion should be
in a motion to dismiss or in the answer.  filed within the time for, but before the filing of, the
answer to the complaint or pleading asserting a claim.
o Another novelty introduced by the present Rules, which Equally important to this provision is Section 1
was totally absent in its two precedents, is the addition o Rule 9 of the Rules of Court which states that defenses
of the period of time within which a motion to dismiss and objections not pleaded either in a motion to dismiss
should be filed as provided under Section 1, Rule 16 or in the answer are deemed waived, except for the
and we quote: Within the time for but before filing the following grounds: 1) the court has no jurisdiction over
answer to the complaint or pleading asserting a claim, a the subject matter; 2) litis pendencia; 3) res judicata;
motion to dismiss may be made on any of the following and 4) prescription.
grounds
o Therefore, the grounds not falling under these four o That the respondents did not allege in their answer the
exceptions may be considered as waived in the event subject grounds is made more apparent through their
that they are not timely invoked.  argument, both in their motion to dismiss and in their
o Both the RTC and the CA found that the motion to comment, that it was only during the pre-trial stage that
dismiss was only filed after the filing of the answer and they verbally manifested and invited the attention of the
after the pre-trial had been concluded. lower court on their grounds for dismissal. I
o Because there was no motion to dismiss before the o The rules are clear and require no interpretation.
filing of the answer, the respondents should then have Pursuant to Section 1, Rule 9 of the Rules of Court, a
at least raised these grounds as affirmative defenses in motion to dismiss based on the grounds invoked by the
their answer respondents may be waived if not raised in a motion to
o In the present petition, the petitioners reiterate that there dismiss or alleged in their answer
was a blatant non-observance of the rules when the o On the other hand, "the pre-trial is primarily intended to
respondents did not amend their answer to invoke the make certain that all issues necessary to the disposition
grounds for dismissal which were raised only during the of a case are properly raised. The purpose is to obviate
pre-trial and, subsequently, in the subject motion to the element of surprise, hence, the parties are expected
dismiss to disclose at the pre-trial conference all issues of law
o Our examination of the records shows that the CA had and fact which they intend to raise at the trial, except
no basis in its finding that the respondents alleged the such as may involve privileged or impeaching matter.
grounds as affirmative defenses in their answer.
o The respondents merely stated in their petition for [SUB]
certiorari that they alleged the subject grounds in their
answer. However, nowhere in the petition did they WON petitioners are real parties interest- YES
support this allegation; they did not even attach a copy WON the heirs of spouses Panaca are indispensable
of their answer to the petition. parties- YES
o Clearly, other than the respondents’ bare allegations,
the CA had no basis to rule, without proof, that the o The failure to implead the indispensable parties in this
respondents alleged the grounds for dismissal as case, was not a ground for dismissal. Petitioners were
affirmative defenses in the answer ordered to implead the heirs of spouses. It is in their
o The respondents, as the parties with the burden of failure to do so that would warrant the dismissal.
proving that they timely raised their grounds for o Real party in interest is the party who stands to be
dismissal, could have at least attached a copy of their benefited or injured by the judgment of the suit, or the
answer to the petition.  party entitled to the avails of the suit.
o On the other hand, an indispensable party is a party in o With these discussions as premises, the Court is of the
interest without whom no final determination can be view that the proper remedy in the present case is to
had of an action implead the indispensable parties especially when their
o In contrast to a necessary party, which is one who is non-inclusion is merely a technical defect. To do so
not indispensable but who ought to be joined as a party would serve proper administration of justice and
if complete relief is to be accorded as to those already prevent further delay and multiplicity of suits.
parties, or for a complete determination or settlement of o Pursuant to Section 9, Rule 3 of the Rules of Court,
the claim subject of the action. parties may be added by order of the court on motion of
o If a suit is not brought in the name of or against the real the party or on its own initiative at any stage of the
party in interest, a motion to dismiss may be filed on action. If the plaintiff refuses to implead an
the ground that the complaint states no cause of action. indispensable party despite the order of the court, then
However, the dismissal on this ground entails an the court may dismiss the complaint for the plaintiff’s
examination of whether the parties presently pleaded failure to comply with a lawful court order.
are interested in the outcome of the litigation, and not o Although there are decided cases wherein the non-
whether all persons interested in such outcome are joinder of indispensable parties in fact led to the
actually pleaded dismissal of the suit or the annulment of judgment, such
o Both indispensable and necessary parties are considered cases do not jibe with the matter at hand. The better
as real parties in interest, since both classes of parties view is that non-joinder is not a ground to dismiss the
stand to be benefited or injured by the judgment of the suit or annul the judgment. The rule on joinder of
suit indispensable parties is founded on equity
o At the inception of the present case, both the spouses o The operative act that would lead to the dismissal of the
Pacaña were not impleaded as parties-plaintiffs. case would be the refusal to comply with the directive
o The Court notes, however, that they are of the court for the joinder of an indispensable party to
indispensable parties to the case as the alleged the case
owners of Rovila Water Supply. Without their o Obviously, in the present case, the deceased Pacañas
inclusion as parties, there can be no final can no longer be included in the complaint as
determination of the present case. indispensable parties because of their death during the
o They possess such an interest in the controversy that pendency of the case. Upon their death, however, their
a final decree would necessarily affect their rights, ownership and rights over their properties were
so that the courts cannot proceed without their transmitted to their heirs, including herein petitioners
presence. Their interest in the subject matter of the o Court acknowledged that the heirs, whose hereditary
suit and in the relief sought is inextricably rights are to be affected by the case, are deemed
intertwined with that of the other parties
 indispensable parties who should have been impleaded pay the unpaid balance of P900.00 despite repeated
by the trial court. demands
o It also alleged as a "special and affirmative
o Therefore, to obviate further delay in the proceedings of defense" that "it has no obligation to pay to the
the present case and given the Court’s authority to order plaintiff the amount or sum of money claimed in
the inclusion of an indispensable party at any stage of the complaint."
the proceedings, the heirs of the spouses Pacaña, except o Defendant did not deny under oath the authenticity
the petitioners who are already parties to the case are of the purchase order annexed to the complaint, as
Lagrimas Pacaña-Gonzalez who intervened in the case, required by Rule 8, section 8 of the Revised Rules of
are hereby ordered impleaded as parties-plaintiffs Court.
o LC: Ruled in favor of Plaintiff.
o Upholding plaintiff's position: "when
defendant's answer denies the allegations of the
complaint because the defendant 'has no
knowledge or information sufficient to form a
belief' and 'specifically denies' other allegations,
said denials are in fact mere general denials
amounting to admissions of the material
allegations of the complaint."
JP JUAN & SONS v LIANGA INDUSTRIES o "The facts alleged in plaintiff's complaint are of
FACTS the kind that plainly and necessarily must be
o In a complaint originally filed with the City Court of within defendant's knowledge, and of which
Manila on plaintiff JP Sons sought recovery from the defendant cannot logically pretend
defendant Lianga Industries of the sum of P900.00, ignorance, ..." and that "The material allegations
representing the unpaid balance of office equipment of the complaint must, therefore, be deemed as
amounting to P1,890.00 sold and delivered by plaintiff admitted by the defendant ..." 
to defendant under a purchase order, copy of which o "Said material allegations deemed admitted by
was duly annexed to the complaint. the defendant, the defendant purchased from the
o City Court: In favor of Plaintiff. Defendant appealed plaintiff office equipment listed in the Purchase
o Defendant’s Answer: "denied specifically material Order No. 001/62, a photostatic copy of which
allegations referring to its purchase of the office was attached to the complaint as Annex A, the
equipment, its partial payment and refusal and failure to authenticity of which has not been denied under
oath.
 o CA: Certified the appeal to the SC since there were no o "An unexplained denial of information and belief of a
facts which were disputed. matter of records, the means of information concerning
which are within the control of the pleader, or are
ISSUE/S && RATIO readily accessible to him, is evasive and is insufficient
WON the lower court erred when it ruled that defendant to constitute an effective denial
failed to specifically deny the actionable documents o The form of denial  ... adopted by the appellants,
(purchase order)- NO although allowed by the Rules of Court (referring to
lack of sufficient knowledge or information) must be
o No error was committed by the Court below in ruling availed of with sincerity and in good faith, — certainly
that defendant-appellant's "specific denials" are in law neither for the purpose of confusing the adverse party
general denials amounting to admissions of the material as to what allegations of the complaint are really put in
allegations of the complaint and in rendering judgment issue nor for the purpose of delay."
on the pleadings, in accordance with the settled doctrine o Its claim that it tendered an issue with its "affirmative
in this jurisdiction based on the provisions of Rule 8, defense" of "having no obligation to pay to the plaintiff
section 10 and Rule 9, section 1 in relation to Rule 19, the amount or sum of money claimed in the complaint"
section 1 and Rule 20, section 3 of the Revised Rules of was correctly held by the Court below to be a mere
Court. conclusion not premised on an allegation of material
o El Hogar v Filipo: "Defendant's answer wherein it facts.
merely 'denies generally and specifically each and o Its "specific denial" of the material allegations of the
every allegation contained in each and every paragraph complaint as to its purchase of the office equipment
of the complaint,' is but a general denial. It is not a from plaintiff under the purchase order annexed to the
specific denial under section 7 of Rule 9, because it complaint and refusal to pay the unpaid balance of
does not deal specifically with each material allegation P900.00 due thereon, without setting forth the substance
of fact, nor does it set forth the substance of the matters of the matters relied upon to support its general denial,
upon which the defendant relies to support his denial.  when such matters were plainly within its knowledge
o It does not serve the purpose of requiring the and it could not logically pretend ignorance as to the
defendant to make a specific denial, which is to same, therefore, failed to properly tender an issue.
compel him to specify the matters which he o Furthermore, its failure to deny under oath the
intends to disprove and disclose the matters authenticity of the purchase order annexed to the
upon which he relies to support his denial, complaint, as required by Rule 8, section 8 of the
thereby limiting the issues and avoiding Revised Rules of Court was properly deemed an
unnecessary delays and surprises. admission of the genuineness and due execution
thereof.
 o The Rules further require in Rule 7 section 5 that "every o Respondent claims that it made several written demands
pleading of a party represented by an attorney shall be for petitioner to pay the said balance, but the latter
signed by at least one attorney of record in his continuously refused to heed its plea.
individual name" and that "the signature of an attorney o Petitioner filed its Answer with Counterclaim
constitutes a certificate by him that he has read the o Respondent then moved for judgment on the pleadings
pleading and that to the best of his knowledge, on the ground that the Answer admitted all material
information and belief, there is good ground to support allegations of the Complaint and, therefore, failed to
it; and that it is not interposed for delay" with the tender an issue. 
express admonition that "for a willful violation of this o Thus, respondent deems that petitioner’s
rule, an attorney may be subjected to disciplinary Answer, in effect, admitted the existence of the
action." Memorandum of Agreement and its failure to
o The cooperation of litigants and their attorneys is pay the balance despite repeated demands.
needed so that the salutary objectives of these Rules o RTC Makati: Ruled in favor of Respondent. Petitioner
may be attained ordered to pay
o Answer of the petitioner failed to tender an
ASIAN CONSTRUCTION v SANNAEDLE issue, respondent argued that the present action
FACTS is for collection of the amount of
o This case stemmed from a Complaint for Sum of US$615,620.33 which amount represents the
Money filed by respondent Sannaedle against petitioner balance of the payment under the Memorandum
Asian Construction. of Agreement, Annex B of the Complaint
o The complaint alleged that petitioner and entered into between [respondent] and
respondent executed a Memorandum of [petitioner] which was not denied in the
Agreement wherein Petitioner Asian was Answer. 
engaged to supply and erect insulated panel o CA: Affirmed RTC
systems at various pavilions at the Philippine o MR Denied
Centennial Exposition Theme Park, specifically
for the Phase I Project, for an agreed amount of ISSUE/S && RATIO
US$3,745,287.94. WON judgment on the pleadings is proper- YES
o Pursuant to said agreement, petitioner Asian made
various payments amounting to US$3,129,667.32 o Petitioner: Judgment on the pleadings is not proper,
leaving a balance of US$615,620.33.  because it raised special and affirmative defenses in its
Answer.
 o It asserts that with this specific denial, a genuine o Here, it is irrefutable that petitioner acknowledged
issue of fact had been joined to the extent that a having entered into a Memorandum of Agreement with
judgment on the pleadings could not be made. respondent and that it still has an unpaid balance of
o Respondent: Petitioner’s Answer admitted the material US$615,620.33.
allegations of its complaint regarding the cause of o While petitioner allegedly raised affirmative defenses,
action, which is collection of sum of money. i.e., defect in the certification of non-forum shopping,
o Sec. 1 R34. Judgment on the pleadings. – Where an no legal capacity to sue and fortuitous event, the same
answer fails to tender an issue, or otherwise admits the cannot still bar respondent from seeking the collection
material allegations of the adverse party’s pleading, the of the unpaid balance.
court may, on motion of that party, direct judgment on o Other than these affirmative defenses, petitioner’s
such pleading. However, in actions for declaration of denial neither made a specific denial that a
nullity or annulment of marriage or for legal separation, Memorandum of Agreement was perfected nor did
the material facts alleged in the complaint shall always it contest the genuineness and due execution of said
be proved. agreement.
o Judgment on the pleadings is proper when an answer o First, the allegations in the [petitioner’s] Answer do not
fails to tender an issue, or otherwise admits the material make out a specific denial that a Memorandum of
allegations of the adverse party’s pleading. Agreement was perfected between the parties.
o An answer fails to tender an issue if it does not comply o Second, the [respondent] does not contest the due
with the requirements of a specific denial as set out in execution and/or genuineness of said Memorandum of
Sections 8 and 10, Rule 8 of the 1997 Rules of Civil Agreement. I
Procedure, resulting in the admission of the material o The defenses raised by [petitioner] cannot prevent the
allegations of the adverse party’s pleadings. [respondent] from seeking the collection of the amount
o Where a motion for judgment on the pleadings is filed, of US$615,620.33. The express terms of the
the essential question is whether there are issues Memorandum of Agreement, the genuineness and due
generated by the pleadings. execution of which are not denied by the [petitioner].
o In a proper case for judgment on the pleadings, there is o It cannot assert the said defenses in order to resist the
no ostensible issue at all because of the failure of the [respondent's] claim for the aforesaid sum of money,
defending party’s answer to raise an issue. especially where it has been sufficiently shown by the
o The answer would fail to tender an issue, of course, if it allegations of the Complaint and the Answer that the
does not deny the material allegations in the complaint [petitioner] is clearly liable for the payment thereof
or admits said material allegations of the adverse
party’s pleadings by confessing the truthfulness thereof
and/or omitting to deal with them at all.