THIRD DIVISION

[G.R. No. 175085. June 1, 2016.]

TAN SIOK 1 KUAN and PUTE CHING, petitioners, vs. FELICISIMO "BOY" HO, RODOLFO
C. RETURTA, 2 VICENTE M. SALAS, and LOLITA MALONZO, respondents.
DECISION
PEREZ, J p:
Before the Court is a Petition for Review on Certiorari 3 assailing the Decision 4 dated June
29, 2006 and the Resolution 5 dated October 17, 2006 of the Court of Appeals (CA) in CA-
G.R. SP No. 92107, which rulings reversed the Consolidated Decision 6 dated May 6, 2005 of the
Regional Trial Court (RTC) in Civil Case Nos. Q-04-53505 to Q-04-53511 and the Joint
Decision 7 dated July 8, 2004 of the Metropolitan Trial Court (MeTC) in Civil Case Nos. 30272 to
30278 and, in effect, dismissed for lack of merit the complaints for unlawful detainer filed by herein
petitioners.
Antecedent Facts
The case at bar stems from seven (7) separate complaints for unlawful detainer filed by
petitioners Tan Siu Kuan and Pute Ching against defendants Avelino Bombita (Bombita), Felix
Gagarin (Gagarin), Bernardo Napolitano (Napolitano), Felicisimo "Boy" Ho (Ho), Rodolfo Returta
(Returta), Vicente Salas (Salas), and Lolita Malonzo (Malonzo).
In their Complaints, 8 petitioners averred that they are the owners of a parcel of land, along
with the improvements therein, located at Apollo Street, San Francisco del Monte, Quezon City,
and covered by Transfer Certificate of Title (TCT) Nos. 279014 and 279015; that they have been
leasing portions of said property to the defendants since 1972; and that on February 7, 2003 they
notified defendants in writing of their failure to pay rentals, as follows:
- defendant AVELINO BOMBITA that his rentals from March 1997 to the
present have not been paid in the total sum of Php17,500.00 as of December, 2002;
- defendant FELIX GAGARIN that his rentals from September 1997 to the
present have not been paid in the total sum of Php16,000.00 as of December, 2002;
- defendant FELICISIMO "BOY" HO that his rentals from December 1996 to
the present have not been paid in the total sum of Php28,700.00 as of December,
2002;
- defendant LOLITA MALONZO that her rentals from January, 1997 to the
present have not been paid in the total sum of Php21,600.00 as of December, 2002;
- defendant BERNARDO NAPOLITANO that his rentals from
September, 1997 to the present have not been paid in the total sum of
Php16,000.00 as of December, 2002;
- defendant RODOLFO RETURTA that his rentals from July, 1996 to the
present have [not] been [paid in] the total sum of Php23,700.00 as of December,
2002; and
- defendant VICENTE SALAS [that] his rentals from August, 1997 to the
[present have] not been paid in the total sum of Php22,750.00 as of December,
2002. 9
Defendants were given ten (10) days to pay the rentals due or else to vacate the premises
and turn over the possession thereof to petitioners, but defendants allegedly ignored petitioners'
demand, warranting the filing of the complaints for unlawful detainer. 10
For their part, Bombita, Gagarin, and Napolitano (defendants) argued that the lease
agreements they have executed with petitioners are void ab initio, petitioners being Chinese
nationals who are not entitled to own real property in the Philippines. Moreover, they claimed to
have been in possession of the subject premises since 1968 or some 35 years ago, thus plaintiff's
action cannot be one for ejectment or unlawful detainer, but accion publiciana which must be filed
before the RTC. 11
On the other hand, Ho, Returta, Salas, and Malonzo, herein respondents, maintained that
they have been in possession of the subject premises for 37 years without any rentals being paid
to any landlord or his agents, and that there are no existing lease contracts between respondents
and petitioners. In fact, in separate letters to petitioners, in response to the latter's demand letters,
respondents categorically denied renting the subject premises. 12 Respondents also asserted that
they have started possessing said property in 1966 by building residential houses, and that they
have been in continuous possession since then. Additionally, respondents claimed that petitioners
presented only photocopies of the subject TCTs and that when they presented such to the
Register of Deeds of Quezon City for verification as to how such were transferred from the mother

1
titles TCT Nos. 12505 and 12506, said office informed them that there is no single transaction
recorded in the aforesaid mother titles. 13 Lastly, respondents argued that even assuming that
petitioners' titles are authentic, their cause of action should have been accion
publiciana considering that respondents are in possession and that no lease contract exists
between the parties. CAIHTE
After trial, the MeTC-Branch 40, Quezon City ruled in favor of petitioners. As regards
defendants, the MeTC held that they impliedly admitted the existence of lease contracts between
them and petitioners and, as such, they cannot deny the consequent lessor-lessee relationship
following the rule that a tenant is not permitted to deny the title of his landlord. As regards
respondents, on the other hand, the MeTC ruled that since petitioners were able to show that the
property in question was registered under their name, and since respondents merely denied the
existence of a lessor-lessee relationship between them and petitioners, petitioners' averments
must prevail following the tenet that in weighing contradictory declarations and statements, greater
weight must generally be given to positive testimony.
Thus, the MeTC disposed of the case in this manner: 14
WHEREFORE, premises considered, judgment is hereby rendered in favor of
the herein plaintiffs TAN SIU KUAN & PUTE CHING as against all the above named
defendants over that certain property located at Apollo Street, San Francisco del
Monte, Quezon City covered by TRANSFER CERTIFICATE OF TITLE NOS.
270014 and 279015, both of the Registry of Deeds for Quezon City, as follows:
IN CIVIL CASE NO. 30272:
a. ordering the defendant AVELINO BOMBITA and any and all persons
claiming rights under him [to] vacate the premises in question, and to peacefully
surrender and turn over the possession of the same unto plaintiffs;
b. ordering said defendant to pay unto plaintiff the sum of Php250.00 per
month starting from February 7, 2003 until they have completely vacated the
premises;
c. ordering said [defendant to] pay unto plaintiff the sum of Php10,000.00
pesos as and by way of attorney's fees, plus costs of suit.
IN CIVIL CASE NO. 30273:
[a] ordering the defendant FELIX GAGARIN and any and all persons claiming
rights under him to vacate the premises in question, and to peacefully surrender and
turn over the possession of the same unto plaintiffs;
b. ordering said defendant to pay unto plaintiff the sum of Php250.00 per
month starting from February 7, 2003 until they have completely vacated the
premises;
c. ordering said defendant to pay unto plaintiff the sum of Php10,000.00
pesos as and by way of attorney's fees, plus costs of suit.
IN CIVIL CASE NO. 30274:
a. ordering the defendant FELICISIMO "[BOY]" HO and any and all persons
[claiming] rights under him to vacate the premises in question, and to peacefully
surrender and turn over the possession of the same unto plaintiffs;
b. ordering said defendant to pay unto plaintiff the sum of Php350.00 per
month starting from February 7, 2003 until they have completely vacated the
premises;
c. ordering said defendant to pay unto plaintiff the sum of Php10,000.00
pesos as and by way of attorney's fees, plus costs of suit.
IN CIVIL CASE NO. 30275:
a. ordering the defendant LOLITA MALONZO and any and all persons
claiming rights under her to vacate the premises in question, and to peacefully
surrender and turn over the possession of the same unto plaintiffs;
b. ordering said defendant to pay unto plaintiffs the sum of Php300.00 per
month starting from February 7, 2003 until they have completely vacated the
premises;
c. ordering said defendant to pay unto plaintiffs the sum of Php10,000.00
pesos as and by way of attorney's fees, plus costs of suit.

2
 IN CIVIL CASE NO. 30276:
a. ordering the defendant BERNARDO NAPOLITANO and any [and all]
persons claiming rights under him to vacate the premises in question, and to
peacefully surrender and turn over the possession of the same unto plaintiffs;
b. ordering said defendant to pay unto plaintiffs the sum of Php250.00 per
month starting from February 7, 2003 until they have completely vacated the
premises;
c. ordering said defendant to pay unto plaintiffs the sum of Php10,000.00
pesos as and by way of attorney's fee[s], plus costs of suit.
IN CIVIL CASE NO. 30277:
a. ordering the defendant RODOLFO RETURTA and any and all persons
claiming rights under him to vacate the premises in question, and to peacefully
surrender and turn over the possession of the same unto plaintiffs;
b. ordering said defendant to pay unto plaintiffs the sum of Php300.00 per
month starting from February 7, 2003 until they have completely vacated the
premises;
c. ordering said defendant to pay unto plaintiffs the sum of Php10,000.00
pesos as and by way of attorney's fees, plus costs of suit.
-and-
IN CIVIL CASE NO. 30278:
[a] ordering the defendant VICENTE SALAS and any and all persons claiming
rights under him to vacate the premises in question, and to peacefully surrender and
turn over the possession of the same unto plaintiffs;
b. ordering said defendant to pay unto plaintiffs the sum of Php350.00 per
month starting from February 7, 2003 until they have completely vacated the
premises; and
c. ordering said defendant to pay unto plaintiffs the sum of Php10,000.00
pesos as and by way of attorney's fees, plus costs of suit.
SO ORDERED.
Upon appeal, the RTC-Branch 87, Quezon City affirmed the MeTC. According to the RTC,
the "defendant's common defense is that the complaint states no cause of action against them on
the grounds that plaintiffs are [C]hinese nationals, hence, not entitled to own real properties in the
Philippines; occupancy since 1968, hence, the action should have been accion publiciana; and
absence of lessor/lessee relationship." 15 Said court then went on to address these issues, as
follows: "Relative to the first three assigned errors, the Court finds that the matters have been
thoroughly and judiciously passed upon by the court a quo in arriving at the subject decision,
hence, this Court finds no compelling reason to disturb the same." 16
Thus, the RTC ruled: 17
In sum, the Court finds no reversible error in the decision of the court a
quo and hereby affirms the same en toto.
Costs against the defendant.
SO ORDERED.
On motion, the RTC issued a Writ of Execution dated January 16, 2006. 18 On February
24, 2006, the subject premises were turned over to petitioners. 19
In the meantime, on November 18, 2005, respondents timely filed their appeal before the
CA, questioning the jurisdiction of the MeTC over the consolidated cases, the finding of a lessor-
lessee relationship between petitioners and respondents in violation of the principle of res inter
alios acta, and the non-dismissal of the case despite the failure of petitioners and their counsel to
attend the pre-trial conference. 20
Petitioners, on the other hand, averred that the assailed decision has already become final
and executory for failure to file the Joint Motion for Reconsideration of the RTC Decision within the
prescribed period and, in fact, a writ of execution has already been issued. Alternatively, they
argued that since respondents refused to pay their rentals from 1997 to present, and since non-
payment of rent is a valid ground for ejectment, then the lower courts were correct in ruling in their
favor. 21

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 After evaluating the merits of the case, the CA reversed the RTC. Although the CA upheld
the jurisdiction of the MeTC, saying that the allegations in the complaints make a case for unlawful
detainer and that the complaints were filed within one year from respondents' receipt of the
demand letters, it nevertheless agreed with respondents that petitioners have materially failed to
prove their right to eject respondents on the strength of being lessors. Moreover, the CA sustained
respondents' invocation of the principle of res inter alios acta. DETACa
Thus, the CA held: 22
WHEREFORE, the Consolidated Decision dated May 6, 2005 of the Regional
Trial Court, Branch 87, Quezon City is hereby REVERSED and SET ASIDE. In its
stead, a new one is entered dismissing the actions for unlawful detainer for lack of
merit.
SO ORDERED. 23 (Citation omitted.)
The Present Petition
Petitioners filed the present petition for review on certiorari, raising the following issues:
I. THE CONSOLIDATED DECISION DATED 6 MAY 2005 OF THE
REGIONAL TRIAL COURT OF QUEZON CITY BRANCH 87 IN CIVIL CASE NOS.
04-53507, 53508, 04-53510 and 04-53511, WHICH AFFIRMED IN TOTO THE
EARLIER JOINT DECISION DATED 8 JULY 2004 OF THE METROPOLITAN
TRIAL COURT, QUEZON CITY IN CIVIL CASE NOS. 30272 TO 30278 HAD
BECOME FINAL AND EXECUTORY FOR FAILURE OF RESPONDENTS TO FILE
THEIR JOINT MOTION FOR RECONSIDERATION WITHIN THE
REGLEMENTARY PERIOD OF FIFTEEN (15) DAYS FROM RECEIPT OF THE
DECISION. 24
II. THE TENANCY RELATIONSHIP BETWEEN PETITIONERS AND
RESPONDENTS WAS PROPERLY ESTABLISHED. 25
The Ruling of the Court
Petitioners' arguments do not persuade.
Anent the first issue of whether the Joint Motion for Reconsideration of the RTC Decision
was timely filed, a close review of the records yields the finding that it was.
Indeed, as capitalized on by petitioners, respondents stated in their Joint Motion for
Reconsideration that they received the Decision dated May 6, 2005 on May 15, 2005, and that
they filed the Joint Motion for Reconsideration only on June 29, 2005. 26 However, as explained
by respondents, the statement that they received the RTC Decision on May 15, 2005 was
inadvertent and erroneous. 27 The records, particularly the certified true copies of the registry
return slips from the RTC, 28 show that the RTC Decision was simultaneously mailed by the RTC
to the parties only on June 7, 2005. Thus, as correctly maintained by respondents, they could not
have received the RTC Decision on May 15, 2005 or before the said decision was mailed to them.
Respondents then clarified that they received the RTC Decision on June 15, 2005. 29 As such,
the filing of the Joint Motion for Reconsideration on June 29, 2005 was timely and the RTC
Decision was not yet final and executory.
As to the second issue of whether a lessor-lessee relationship between the parties was
properly established, the evidence on record generates a negative conclusion.
Except for petitioners' bare claims, they have not shown any evidence of a lease between
them and respondents, be it express or implied. As keenly observed by the CA, there
was no mention of how and when the alleged contract of lease started, there was no proof of prior
payment of rentals or any prior demand for such payment considering petitioners' allegation that
respondents failed to pay rentals since 1997 and that the case was instituted only in 2003.
Moreover, there is merit in respondents' invocation of the principle of res inter alios acta or
that principle which states that "the right of a party cannot be prejudiced by an act, declaration or
omission of another, except as hereinafter provided, among which are: (1) admission by third
party, (2) admission by co-partner or agent, (3) admission by conspirator, and (4) admission by
privies." 30
In the case of Tamargo v. Awingan, 31 the Court expounded on the rationale behind the
principle of res inter alios acta. Citing People v. vda. De Ramos, the Court held that:
(O)n a principle of good faith and mutual convenience, a man's own acts are
binding upon himself, and are evidence against him. So are his conduct and
declarations. Yet it would not only be rightly inconvenient, but also manifestly unjust,
that a man should be bound by the acts of mere unauthorized strangers; and if a

4
 party ought not to be bound by the acts of strangers, neither ought their acts or
conduct be used as evidence against him.
In the present case, petitioners failed to establish that the defendants' 32 alleged implied
admission of a lessor-lessee relationship falls under the exceptions to the principle of res inter
alios acta as to make such admission binding upon respondents. Although defendants and
respondents were all defendants in the complaints for unlawful detainer filed by petitioners, it is
very clear that defendants and respondents espoused different defenses. Contrary to defendants'
position, respondents, as early as the filing of their response to petitioners' demand letter, firmly
and consistently denied the existence of any lease contract between them and petitioners over the
subject land.
WHEREFORE, finding no reversible error in the assailed rulings, the Court resolves
to DENY the present petition. Accordingly, the Decision dated June 29, 2006 and the Resolution
dated October 17, 2006 of the Court of Appeals are hereby AFFIRMED and the complaints for
unlawful detainer filed by petitioners Tan Siu Kuan and Pute Ching against respondents Felicisimo
"Boy" Ho, Rodolfo Returta, Vicente Salas, and Lolita Malonzo are DISMISSED.
SO ORDERED. (Tan Siok Kuan v. Ho, G.R. No. 175085, [June 1, 2016])

THIRD DIVISION
[G.R. No. 196557. June 15, 2016.]
GREGORIO "TONGEE" BALAIS, JR., petitioner, vs. SE'LON by AIMEE, AMELITA
REVILLA and ALMA BELARMINO, respondents.
DECISION
PERALTA, J p:
This is a Petition for Review Certiorari 1 under Rule 45 of the Rules of Court seeking the
reversal of the Decision 2 dated February 25, 2011 and Resolution 3 dated April 19, 2011 of the
Court of Appeals, respectively, in CA-G.R. SP No. 114899 entitled "Se'lon by Aimee and/or
Amelita Revilla and Alma Belarmino v. NLRC and Gregorio "Tongee" Balais, Jr." TIADCc
The instant petition stemmed from a complaint for illegal dismissal, non-payment of 13th
month pay, damages and attorney's fees filed by Gregorio "Tongee" Balais, Jr. (Balais) against
Se'lon by Aimee, Amelita Revilla and Alma Belarmino before the NLRC.
Balais narrated that he was Salon de Orient's senior hairstylist and make-up artist from
October 16, 2004 until November 26, 2007 when respondent Amelita Revilla (Revilla) took over
the business. Revilla, however, retained his services as senior hairstylist and make-up artist.
Under the new management, Salon De Orient became Se'lon by Aimee and respondent Alma
Belarmino (Belarmino) was appointed as its salon manager, who was in-charge of paying the
employees' wages, dismissing erring employees, and exercising control over them. Balais, on the
other hand, being the senior hairstylist and make-up artist, allegedly had the discretion to choose
from among the junior hairstylist who should assist him in servicing his clients, as customarily
observed in beauty salons. He worked during the 10am-7pm shift or 11am-8pm shift, six (6) days
a week with Sunday as his regular rest day for a monthly salary of Php18,500.00 paid every two
(2) weeks. In June 2008, his salary was reduced to Php15,000.00. Balais claimed that his working
relationship with respondents had been harmonious until the evening of July 1, 2008 when
Belarmino dismissed him without due process, in the following manner:
Belarmino angrily shouted: "You get out of this Company! I do not need you
here at Se'lon by Aimee!"
Balais Jr.,calmly replied: "Ibigay mo ang 13th month ko and sweldo ko, at
separation pay."
Belarmino angrily replied: "Maghabla ka kahit saan na korte at haharapin
kita."
Balais Jr. responded: "Maski ang Jollibee nagbibigay nang 13th month pay,
sweldo and separation pay pag may tinatanggal na empleyado!"
Belarmino retorted: "Eh di doon ka magtrabaho sa Jollibee kasi doon
nagbibigay sila nang 13th month pay, sweldo at separation pay pag may tinatanggal
na empleyado."
Balais felt humiliated as he was berated in front of his co-workers. The next day, he did not
report for work anymore and instead filed the complaint before the NLRC.
For their part, respondents alleged that it was known to all their employees that one of the
salon's policies was for junior stylists to take turns in assisting any of the senior stylists for
5
purposes of equalizing commissions. However, Belarmino was told that Balais failed to comply
with this policy as the latter allegedly gave preference to only two (2) junior stylists, disregarding
the other two (2) junior stylists. When Belarmino asked Balais for explanation, the latter allegedly
snapped and retorted that he would do whatever he wanted. Belarmino reminded him of the
salon's policy and his duty to comply with it but petitioner allegedly insisted he would do as he
pleased and if they can no longer take it, they would have to dismiss him. After the incident, Balais
sued them and never reported back to work.
Respondents insisted that Balais was not terminated from employment but he instead
abandoned his work. Respondents explained that even assuming that he was indeed dismissed,
there was a valid ground therefor as his acts amounted to serious misconduct against a superior
and willful disobedience to reasonable policy related to his work.
On February 11, 2009, the Labor Arbiter rendered a Decision 4 holding respondents liable
for illegal dismissal. It gave credence and weight to Balais' version that he was dismissed without
cause and notice for merely defending his decision to avail of the services of some selected junior
stylist of his choice.
Aggrieved, respondents appealed the decision before the NLRC.
On February 19, 2010, the NLRC affirmed in toto the findings of the Labor Arbiter, declaring
petitioner to be illegally dismissed. 5 It ratiocinated that Se'lon by Aimee failed to prove that the act
of petitioner amounted to gross insubordination. Other than respondents' bare denial of illegal
dismissal, the same was unsubstantiated by a clear and convincing evidence. The NLRC further
pointed out that respondents failed to produce a copy of the supposed salon policy on the rule of
rotation of junior stylists, thus, the veracity of the allegation of insubordination against Balais failed
to convince.
Respondents moved for reconsideration, but the same was denied in a Resolution dated
April 22, 2010.
Thus, before the Court of Appeals, respondents filed a Petition for Certiorari with Prayer for
the Issuance of a Temporary Restraining Order and/or Writ of Preliminary Injunction seeking to
annul or modify the Resolutions of the NLRC.
On February 25, 2011, the Court of Appeals granted the petition and reversed and set
aside the NLRC Decision and rendered a Decision 6 sustaining petitioner's dismissal as valid and
required respondents to pay Balais his accrued 13th month pay and unpaid salaries.
Petitioner moved for reconsideration, but was denied in a Resolution dated April 19, 2011.
Thus, the instant petition for review on certiorari raising the following issues: AIDSTE
I
WHETHER THE COURT OF APPEALS HAS DECIDED A QUESTION OF
SUBSTANCE BY DECLARING THE PETITIONER AS VALIDLY DISMISSED
WHICH IS NOT IN ACCORD WITH LAW AND APPLICABLE DECISION OF THE
SUPREME COURT.
II
WHETHER THE COURT OF APPEALS HAS DEPARTED FROM THE
ACCEPTED AND USUAL COURSE OF JUDICIAL PROCEEDINGS AND
CONTRARY TO THE FINDINGS OF THE LABOR ARBITER AND NLRC. 7
We find merit in the petition.
The Court's jurisdiction in cases brought before it from the CA via Rule 45 of the Rules of
Court is generally limited to reviewing errors of law. The Court is not the proper venue to consider
a factual issue as it is not a trier of facts. This rule, however, is not ironclad and a departure
therefrom may be warranted where the findings of fact of the CA are contrary to the findings and
conclusions of the NLRC and the LA, as in this case. In this regard, there is therefore a need to
review the records to determine which of them should be preferred as more conformable to
evidentiary facts. 8 In the instant case, the conflict between the NLRC's and the CA's factual
findings as shown in the records of this case prompts the Court to evaluate such findings anew.
Whether there was a valid dismissal.
The principle echoed and re-echoed in our jurisprudence is that the onus of proving that the
employee was dismissed for a just cause rests on the employer, and the latter's failure to
discharge that burden would result in a finding that the dismissal is unjustified. 9
In the instant case, a perusal of the records would show that both parties presented their
own versions of stories, not necessarily contradicting but nonetheless lacking in some material
points.
6
 Balais alleged that he was illegally dismissed as his dismissal was allegedly made verbally
and without due process of law. Yet, Balais failed to explain what possibly prompted said
termination or even the likely motive for the same. He nevertheless submitted the Affidavits of
Gemma Guerero 10 and Marie Gina A. Toralde, 11 to prove his allegation.
Respondents, on the other hand, alleged that there was no illegal dismissal as it was Balais
himself who did not report to work, thus, he abandoned his work.
Interestingly, however, both parties never denied that there was an altercation between
them. Without admitting that he violated the salon policy of rotation of the junior stylists, Balais
maintained that said policy runs counter with customary salon practice which allows senior
hairstylists to choose their preferred junior stylist to assist them. For their part, supplemental to
their claim of abandonment, respondents averred that assuming that Balais was dismissed, they
insisted that there was a valid ground therefor as he was disrespectful and insubordinate due to
his failure to comply with the salon's policy.
Noteworthy is the fact that respondents never denied that the incident narrated by Balais
actually happened. In Solas v. Power & Telephone Supply Phils., Inc., 12 this silence constitutes
an admission that fortifies the truth of the employee's narration. While respondents were evasive
on the complete details of how the reported incident of termination transpired, they never
categorically denied that said incident happened or the fact that Belarmino uttered: "get out of this
company! I do not need you here." Belarmino attempted to sidestep the fact that she actually said
it, yet, raised the defense that assuming she had indeed verbally terminated Balais, she was
justified in doing so because of the disrespect shown to her.
Under the rules of evidence, if an allegation is not specifically denied or the denial is a
negative pregnant, the allegation is deemed admitted. 13 In fine, the fact that respondents are
even raising their own justification for the alleged verbal dismissal means that the said verbal
dismissal actually transpired. If in the first place, said incident of verbal dismissal truly never
happened, there is nothing to assume anymore or to justify. The fact that Belarmino was offering
justification for her action, it follows that indeed said incident of verbally dismissing Balais on-the-
spot actually happened.
Putting two versions of the story together, considering that none of the parties categorically
deny that an altercation erupted between them which resulted in the dismissal of Balais, and the
tenor of Belarmino's statements leaving no room for interpreting it other than a verbal dismissal,
we are inclined to believe that there was indeed a dismissal.
This being the case, having established that there was dismissal, it becomes axiomatic that
respondents prove that the dismissal was valid.
Respondents averred that there was abandonment as Balais failed to report back to work
the following day after the incident.
In this regard, this Court finds that respondents failed to establish that Balais abandoned
his work. To constitute abandonment, two elements must concur: (a) the failure to report for work
or absence without valid or justifiable reason, and (b) a clear intention to sever the employer-
employee relationship, with the second element as the more determinative factor and being
manifested by some overt acts. 14 Mere absence is not sufficient. The employer has the burden of
proof to show a deliberate and unjustified refusal of the employee to resume his employment
without any intention of returning. Respondents, other than their bare allegation of abandonment,
failed to prove that these two elements were met. It cannot be said that Balais failed to report back
to work without justifiable reason as in fact he was told that he was no longer wanted in the
salon. AaCTcI
Moreover, we likewise note the high improbability of petitioner intentionally abandoning his
work, taking into consideration his length of service, i.e.,18 years of service with the salon. It does
not make sense for an employee who had worked for his employer for 18 years would just
abandon his work and forego whatever benefits he may be entitled, unless he was made to
believe or was told that he was already terminated.
Respondents cannot discharge the burden of proving a valid dismissal by merely alleging
that they did not dismiss Balais; neither can they escape liability by claiming that Balais
abandoned his work. When there is no showing of a clear, valid and legal cause for the
termination of employment, the law considers it a case of illegal dismissal.
Thus, respondents, presumably thinking that their claim of abandonment holds no water, it
likewise manifested that assuming Balais was indeed terminated, there was a valid ground
therefor because of his insubordination.
We disagree.

7
 Willful disobedience of the employer's lawful orders, as a just cause for the dismissal of an
employee, envisages the concurrence of at least two requisites: (1) the employee's assailed
conduct must have been willful or intentional, the willfulness being characterized by a "wrongful
and perverse attitude;" and (2) the order violated must have been reasonable, lawful, made known
to the employee and must pertain to the duties which he had been engaged to discharge. 15
It must be likewise stressed anew that the burden of proving the insubordination as a just
and valid cause for dismissing an employee rests on the employer and his failure to do so shall
result in a finding that the dismissal is unjustified.
In this case, the salon policy of rotating the junior stylists who will assist the senior stylist
appears to be reasonable, lawful, made known to petitioner and pertained to his duty as senior
hairstylist of respondent. However, if we will look at Balais' explanation for his alleged
disobedience thereto, it likewise appears to be reasonable and lawful, to wit:
xxx xxx xxx
The duty of the Senior Stylist has the overall function in seeing to it that the
service accorded to the client is excellent, thus, he has the right to refuse service of
a junior stylist whom he thinks that such junior stylist cannot give equal or over and
above the service that he can give to the client, thus his refusal to obey the
respondent does not constitute a just cause for the treatment given by respondent to
herein respondent (sic).
xxx xxx xxx
The fact alone that Balais failed to comply with the salon policy does not establish that his
conduct in failing to comply with the salon's policy had been willful, or characterized by a wrongful
and perverse attitude. Balais' justification maybe adverse to that of the salon's policy but it was
neither willful nor characterized by a perverse attitude. We take note that the alleged non-
compliance with the salon policy was brought to the attention of Balais for the first time only during
the said incident. There was no showing of prior warnings as to his non-compliance. While
respondents wield a wide latitude of discretion in the promulgation of policies, rules and
regulations on work-related activities of its employees, these must, however, be fair and
reasonable at all times, and the corresponding sanctions for violations thereof, when prescribed,
must be commensurate thereto as well as to the degree of the infraction. Given that Balais'
preference on who will assist him is based on the junior stylists' competence, the same should
have been properly taken into account in the imposition of the appropriate penalty for violation of
the rotation policy. Suspension would have sufficed to caution him and other employees who may
be wont to violate the same policy.
In adjudging that the dismissal was grounded on a just and valid cause, the totality of
infractions or the number of violations committed during the period of employment shall be
considered in determining the penalty to be imposed upon an erring employee. 16 Let it not be
forgotten that what is at stake is the means of livelihood, the name, and the reputation of the
employee. To countenance an arbitrary exercise of the management's prerogative to terminate an
employee is to negate the employee's constitutional right to security of tenure.
Whether the dismissal was effected with due process of law.
Under Article 277 (b) of the Labor Code, the employer must send the employee who is
about to be terminated, a written notice stating the cause/s for termination and must give the
employee the opportunity to be heard and to defend himself.
Article 277 of the Labor Code provides, inter alia:
(a) ...
(b) Subject to the constitutional right of workers to security of tenure and their
right to be protected against dismissal except for a just and authorized cause and
notice under Article 283 of this Code,the employer shall furnish the worker
whose employment is sought to be terminated a written notice containing a
statement of causes for termination and shall afford the latter ample
opportunity to be heard and to defend himself with the assistance of his
representative if he so desires in accordance with company rules and regulations
promulgated pursuant to guidelines set by the Department of Labor and
Employment. . . .
In particular, Rule XXIII, Book V of the Omnibus Rules Implementing the Labor
Code states:

8
 Sec. 2. Standards of due process: requirements of notice.— In all cases of
termination of employment, the following standards of due process shall be
substantially observed:
1. For termination of employment based on just causes as defined in
Article 282 of the Code:
(a) A written notice served on the employee specifying the
ground or grounds for termination, and giving to said
employee reasonable opportunity within which to explain
his side;
(b) A hearing or conference during which the employee
concerned, with the assistance of counsel if the employee
so desires, is given opportunity to respond to the charge,
present his evidence or rebut the evidence presented
against him; and
(c) A written notice of termination served on the employee
indicating that upon due consideration of all the
circumstances, grounds have been established to justify
his termination.
Thus, to effect the dismissal of an employee, the law requires not only that there be just
and valid cause as provided under Article 282 of the Labor Code. It likewise enjoins the employer
to afford the employee the opportunity to be heard and to defend himself. On the latter aspect, the
employer is mandated to furnish the employee with two (2) written notices: (a) a written notice
containing a statement of the cause for the termination to afford the employee ample opportunity
to be heard and defend himself with the assistance of his representative, if he so desires; (b) if the
employer decides to terminate the services of the employee, the employer must notify him in
writing of the decision to dismiss him, stating clearly the reason therefor. EcTCAD
Here, a perusal of the records revealed that, indeed, Belarmino's manner of verbally
dismissing Balais on-the-spot fell short of the two-notice requirement. There was no showing of
prior warnings on Balais' alleged non-compliance with the salon policy. There was no written
notice informing him of his dismissal as in fact the dismissal was done verbally and on-the-spot.
Respondents failed to furnish Balais the written notice apprising him of the charges against him,
as prescribed by the Labor Code. There was no attempt to serve a notice of dismissal on Balais.
Consequently, he was denied due process of law accorded in dismissals.
Reliefs of Illegally Dismissed Employees
Having established that Balais was illegally dismissed, the Court now determines the reliefs
that he is entitled to and their extent. Under the law and prevailing jurisprudence, "an illegally
dismissed employee is entitled to reinstatement as a matter of right." Aside from the instances
provided under Articles 283 17 and 284 18 of the Labor Code, separation pay is, however,
granted when reinstatement is no longer feasible because of strained relations between the
employer and the employee. In cases of illegal dismissal, the accepted doctrine is that separation
pay is available in lieu of reinstatement when the latter recourse is no longer practical or in the
best interest of the parties. 19
However, other than the strained relationship between the parties, it appears that
respondent salon had already ceased operation of its business, thus, reinstatement is no longer
feasible. Consequently, the Court awards separation pay to the petitioner equivalent to one (1)
month pay for every year of service, with a fraction of at least six (6) months considered as one (1)
whole year, from the time of her illegal dismissal up to the finality of this judgment, as an
alternative to reinstatement. 20
Also, employees who are illegally dismissed are entitled to full backwages, inclusive of
allowances and other benefits or their monetary equivalent, computed from the time their actual
compensation was withheld from them up to the time of their actual reinstatement but if
reinstatement is no longer possible, the backwages shall be computed from the time of their illegal
termination up to the finality of the decision. Accordingly, the petitioner is entitled to an award of
full backwages from the time he was illegally dismissed up to the finality of this decision. 21
Balais is likewise entitled to attorney's fees in the amount of 10% of the total monetary
award pursuant to Article 111 22 of the Labor Code. It is settled that where an employee was
forced to litigate and, thus, incur expenses to protect his rights and interest, the award of
attorney's fees is legally and morally justifiable. Finally, legal interest shall be imposed on the
monetary awards herein granted at the rate of six percent (6%) per annum from the finality of this
judgment until fully paid. 23

9
 WHEREFORE, in consideration of the foregoing, the petition is GRANTED.The Decision
dated February 25, 2011 and the Resolution dated April 19, 2011 of the Court of Appeals in CA-
G.R. SP No. 114899 are hereby REVERSED and SET ASIDE.
The respondents are hereby declared GUILTY OF ILLEGAL DISMISSAL AND
ARE hereby ORDERED to pay the petitioner, Gregorio Balais, Jr.,the following:
(a) separation pay in lieu of actual reinstatement equivalent to one (1) month
pay for every year of service, with a fraction of at least six (6) months considered as
one (1) whole year from the time of his dismissal up to the finality of this Decision;
(b) full backwages from the time of his illegal dismissal up to the finality of this
Decision; and
(c) attorney's fees equivalent to ten percent (10%) of the total monetary
award.
The monetary awards herein granted shall earn legal interest at the rate of six percent (6%) per
annum from the date of the finality of this Decision until fully paid. The case is REMANDED to the
Labor Arbiter for the computation of petitioner's monetary award. SO ORDERED. (Balais, Jr. v.
Se'Lon, G.R. No. 196557, [June 15, 2016])

SECOND DIVISION
[G.R. No. 196470. April 20, 2016.]
ROSARIO VICTORIA and ELMA PIDLAOAN, petitioners, vs. NORMITA JACOB
PIDLAOAN, HERMINIGILDA PIDLAOAN and EUFEMIA PIDLAOAN, respondents.
DECISION
BRION, J p:
We resolve the petition for review on certiorari filed by petitioners to challenge the March
26, 2010 decision 1 and March 15, 2011 resolution of the Court of Appeals (CA) in CA-
G.R. CV No. 89235. The Regional Trial Court's (RTC) ruled that Elma Pidlaoan (Elma) donated
only half of the property to Normita Jacob Pidlaoan (Normita). The CA reversed the RTC's
decision and ruled that Elma donated her entire property to Normita. The Court is called upon to
ascertain the true nature of the agreement between Elma and Normita.
THE ANTECEDENTS
The petitioners Rosario Victoria (Rosario) and Elma lived together since 1978 until Rosario
left for Saudi Arabia.
In 1984, Elma bought a parcel of land with an area of 201 square meters in Lucena City
and was issued Transfer Certificate of Title (TCT) No. T-50282. 2 When Rosario came home, she
caused the construction of a house on the lot but she left again after the house was built. 3
Elma allegedly mortgaged the house and lot to a certain Thi Hong Villanueva in
1989. 4 When the properties were about to be foreclosed, Elma allegedly asked for help from her
sister-in-law, Eufemia Pidlaoan (Eufemia), to redeem the property. 5 On her part, Eufemia called
her daughter abroad, Normita, to lend money to Elma. Normita agreed to provide the funds. 6
Elma allegedly sought to sell the land. 7 When she failed to find a buyer, she offered to sell
it to Eufemia or her daughter. 8
On March 21, 1993, Elma executed a deed of sale entitled "Panananto ng Pagkatanggap
ng Kahustuhang Bayad" transferring the ownership of the lot to Normita. 9 The last provision in
the deed of sale provides that Elma shall eject the person who erected the house and deliver the
lot to Normita. 10 The document was signed by Elma, Normita, and two witnesses but it was not
notarized. ASEcHI
When Elma and Normita were about to have the document notarized, the notary public
advised them to donate the lot instead to avoid capital gains tax. 11 On the next day, Elma
executed a deed of donation in Normita's favor and had it notarized. TCT No. T-50282 was
cancelled and TCT No. T-70990 was issued in Normita's name. 12 Since then, Normita had been
paying the real property taxes over the lot but Elma continued to occupy the house.
Rosario found out about the donation when she returned to the country a year or two after
the transaction. 13
In 1997, the petitioners filed a complaint for reformation of contract, cancellation of
TCT No. T-70990, and damages with prayer for preliminary injunction against Eufemia, Normita,
and Herminigilda Pidlaoan (respondents).
The petitioners argued that: first, they co-owned the lot because both of them contributed
the money used to purchase it; second, Elma and Normita entered into an equitable mortgage
10
because they intended to constitute a mortgage over the lot to secure Elma's loan but they
executed a deed of sale instead; and third, the deed of donation was simulated because Elma
executed it upon the notary public's advice to avoid capital gains tax. 14
In their answer, the respondents admitted that the deed of donation was simulated and
that the original transaction was a sale. 15 They argued, however, that there was no agreement to
constitute a real estate mortgage on the lot. 16
The RTC ruled that Rosario and Elma co-owned the lot and the house. 17 Thus, Elma
could only donate her one-half share in the lot. 18
Hence, the respondents appealed to the CA.
THE CA RULING
The CA reversed the RTC's decision and dismissed the petitioners' complaint.
The CA held that Elma and Normita initially entered into two agreements: a loan and a sale.
They entered into a loan agreement when Elma had to pay Thi Hong Villanueva to redeem the
property. Thereafter, Elma sold the property to Normita. They subsequently superseded the
contract of sale with the assailed deed of donation.
The CA also held that the deed of donation was not simulated. It was voluntarily executed
by Elma out of gratitude to Normita who rescued her by preventing the foreclosure of the lot.
Moreover, the deed of donation, being a public document, enjoys the presumption of regularity.
Considering that no conclusive proof was presented to rebut this presumption, the deed of
donation is presumed valid.
The CA denied the petitioners' motion for reconsideration; hence, this petition.
THE PETITIONERS' ARGUMENTS
In their petition, the petitioners argue that: (1) Rosario is a co-owner because she caused
the construction of the house, which has a higher market value than the lot; (2) the deed of
donation is simulated; (3) the transaction was a mere equitable mortgage; and (4) the CA unduly
disturbed the RTC's factual findings. The petitioners emphasize that the respondents have
consistently admitted in their answer that the deed of donation was simulated; therefore, the CA
should not have reversed the RTC's decision on that point.
In their three-page comment, the respondents insist that the CA correctly dismissed the
complaint. They stressed that the petitioners were the ones who argued that the deed of donation
was simulated but the CA ruled otherwise. Furthermore, the petition involves questions of facts
and law outside the province of the Supreme Court. Hence, the petition must be dismissed.
THE COURT'S RULING
We PARTIALLY GRANT the petition.
The issues before the Court are: (1) whether Rosario is a co-owner; (2) whether the deed
of donation was simulated; and (3) whether the transaction between Elma and Normita was a
sale, a donation, or an equitable mortgage. Considering that these issues are inter-related, we
shall jointly discuss and resolve them.
At the outset, we note that the issues raised by the petitioners in the present case require a
review of the factual circumstances. As a rule, only questions of law may be raised in a petition for
review on certiorari under Rule 45 of the Rules of Court.
The Court distinguished between a question of law and a question of fact in a number of
cases. A question of law arises when there is doubt on what the law is on a certain set of fact,
while a question of fact exists when there is doubt as to the truth or falsity of the alleged
facts. 19 For a question to be one of law, it must not involve an examination of the probative value
of the evidence presented by the litigants. 20 If the issue invites a review of the evidence on
record, the question posed is one of fact. 21
The factual findings of the CA are conclusive and binding and are not reviewable by the
Court, unless the case falls under any of the recognized exceptions. 22 One of these exceptions is
when the findings of the RTC and the CA are contradictory, as in the present case.
By granting the appeal and dismissing the petitioners' complaint, the CA effectively ruled
that the transfer of ownership involved the entire lot rather than only half of it as the RTC held. The
lower courts' differing findings provide us sufficient reason to proceed with the review of the
evidence on record. 23 ITAaHc
First, we rule that Elma transferred ownership of the entire lot to Normita.
One who deals with property registered under the Torrens system has a right to rely on
what appears on the face of the certificate of title and need not inquire further as to the property's
11
ownership. 24 A buyer is charged with notice only of the claims annotated on the title. 25 The
Torrens system was adopted to best guarantee the integrity of land titles and to protect their
indefeasibility once the claim of ownership is established and recognized. 26
In the present case, the records of the case show that Elma alone purchased the lot in
1984 from its previous owners. 27 Accordingly, TCT No. T-50282 was issued solely in her name.
Thus, Normita bought the lot relying on the face of the TCT that Elma and no other person owned
it.
We acknowledge that registration under the Torrens system does not create or vest title. A
certificate of title merely serves as an evidence of ownership in the property. Therefore, the
issuance of a certificate of title does not preclude the possibility that persons not named in the
certificate may be co-owners of the real property, or that the registered owner is only holding the
property in trust for another person. 28
In the present case, however, the petitioners failed to present proof of Rosario's
contributions in purchasing the lot from its previous owners. The execution of the transfer
documents solely in Elma's name alone militate against their claim of co-ownership. Thus, we
find no merit in the petitioners' claim of co-ownership over the lot.
At this point, we address the petitioners' claim that Rosario co-owned the lot with Elma
because the value of the house constructed by Rosario on it is higher than the lot's value. We find
this argument to be erroneous.
We hold that mere construction of a house on another's land does not create a co-
ownership. Article 484 of the Civil Code provides that co-ownership exists when the ownership of
an undivided thing or right belongs to different persons. Verily, a house and a lot are separately
identifiable properties and can pertain to different owners, as in this case: the house belongs to
Rosario and the lot to Elma.
Article 448 of the Civil Code provides that if a person builds on another's land in good faith,
the land owner may either: (a) appropriate the works as his own after paying indemnity; or (b)
oblige the builder to pay the price of the land. The law does not force the parties into a co-
ownership. 29 A builder is in good faith if he builds on a land believing himself to be its owner and
is unaware of the defect in his title or mode of acquisition. 30
As applied in the present case, Rosario's construction of a house on the lot did not create a
co-ownership, regardless of the value of the house. Rosario, however, is not without recourse in
retrieving the house or its value. The remedies available to her are set forth in Article 448 of the
Civil Code.
Second, on the nature of the transaction between Elma and Normita, we find that the
deed of donation was simulated and the parties' real intent was to enter into a sale.
The petitioners argue that the deed of donation was simulated and that the parties entered
into an equitable mortgage. 31 On the other hand, the respondents deny the claim of equitable
mortgage 32 and argue that they validly acquired the property via sale. 33 The RTC ruled that
there was donation but only as to half of the property. The CA agreed with the respondents that
the deed of donation was not simulated, relying on the presumption of regularity of public
documents.
We first dwell on the genuineness of the deed of donation. There are two types of
simulated documents — absolute and relative. A document is absolutely simulated when the
parties have no intent to bind themselves at all, while it is relatively simulated when the parties
concealed their true agreement. 34 The true nature of a contract is determined by the parties'
intention, which can be ascertained from their contemporaneous and subsequent acts. 35
In the present case, Elma and Normita's contemporaneous and subsequent acts show that
they were about to have the contract of sale notarized but the notary public ill-advised them to
execute a deed of donation instead. Following this advice, they returned the next day to have a
deed of donation notarized. Clearly, Elma and Normita intended to enter into a sale that would
transfer the ownership of the subject matter of their contract but disguised it as a donation. Thus,
the deed of donation subsequently executed by them was only relatively simulated.
The CA upheld the deed of donation's validity based on the principle that a notarized
document enjoys the presumption of regularity. This presumption, however, is overthrown in this
case by the respondents' own admission in their answer that the deed of donation was simulated.
Judicial admissions made by a party in the course of the proceedings are conclusive and
do not require proof. 36 Notably, the respondents explicitly recognized in their answer that the
deed of donation was simulated upon the notary public's advice and that both parties intended a
sale. 37

12
 In paragraphs 5 and 6 of the answer, 38 the respondents stated thus:
5. That defendants admit the allegations in paragraph 9 which readily
acknowledges that there was indeed an agreement to sell the property of plaintiff,
Elma Pidlaoan to defendant, Normita Pidlaoan (Normita, for brevity) for which a
Deed of Absolute Sale was drafted and executed;
6. That defendants admit the simulation of the Deed of Donation in
paragraph 10 of the Complaint, but deny the remainder, the truth being that Elma
Pidlaoan herself offered her property for sale in payment of her loans from Normita.
(Emphasis supplied) CHTAIc
Having admitted the simulation, the respondents can no longer deny it at this stage. The
CA erred in disregarding this admission and upholding the validity of the deed of donation.
Considering that the deed of donation was relatively simulated, the parties are bound to
their real agreement. 39 The records show that the parties intended to transfer the ownership of
the property to Normita by absolute sale. This intention is reflected in the unnotarized document
entitled "Panananto ng Pagkatanggap ng Kahustuhang Bayad." 40
We have discussed that the transaction was definitely not one of donation. Next, we
determine whether the parties' real transaction was a sale or an equitable mortgage.
The petitioners insist that the deed of sale is an equitable mortgage because: (i) the
consideration for the sale was grossly inadequate; (ii) they remained in possession of the
property; (iii) they continuously paid the water and electric bills; (iv) the respondents allowed
Victoria to repay the "loan" within three months; 41 (v) the respondents admitted that the deed of
donation was simulated; and (vi) the petitioners paid the taxes even after the sale.
Notably, neither the CA nor the RTC found merit in the petitioners' claim of equitable
mortgage. We find no reason to disagree with these conclusions.
An equitable mortgage is one which, although lacking in some formality or other requisites
demanded by statute, nevertheless reveals the intention of the parties to charge real property as
security for a debt, and contains nothing impossible or contrary to law. 42 Articles 1602 and 1604
of the Civil Code provide that a contract of absolute sale shall be presumed an equitable mortgage
if any of the circumstances listed in Article 1602 is attendant.
Two requisites must concur for Articles 1602 and 1604 of the Civil Code to apply: one, the
parties entered into a contract denominated as a contract of sale; and two, their intention was to
secure an existing debt by way of mortgage. 43
In the present case, the unnotarized contract of sale between Elma and Normita is
denominated as "Panananto ng Pagkatanggap ng Kahustuhang Bayad." 44 Its contents show an
unconditional sale of property between Elma and Normita. The document shows no intention to
secure a debt or to grant a right to repurchase. Thus, there is no evidence that the parties agreed
to mortgage the property as contemplated in Article 1602 of the Civil Code. Clearly, the contract is
not one of equitable mortgage.
Even assuming that Article 1602 of the Civil Code applies in this case, none of the
circumstances are present to give rise to the presumption of equitable mortgage. One, the
petitioners failed to substantiate their claim that the sale price was unusually inadequate. 45 In
fact, the sale price of P30,000.00 is not unusually inadequate compared with the lot's market value
of P32,160 as stated in the 1994 tax declaration. Two, the petitioners continued occupation on the
property was coupled with the respondents' continuous demand for them to vacate
it. Third, no other document was executed for the petitioners to repurchase the lot after the sale
contract was executed. Finally, the respondents paid the real property taxes on the lot. 46 These
circumstances contradict the petitioners' claim of equitable mortgage.
A review of the sale contract or the "Panananto ng Pagkatanggap ng Kahustuhang
Bayad" shows that the parties intended no equitable mortgage. The contract even contains Elma's
undertaking to remove Rosario's house on the property. 47 This undertaking supports the
conclusion that the parties executed the contract with the end view of transferring full ownership
over the lot to Normita.
In sum, we rule that based on the records of the case, Elma and Normita entered in a sale
contract, not a donation. Elma sold the entire property to Normita. Accordingly, TCT No. T-70990
was validly issued in Normita's name.
WHEREFORE, we hereby PARTIALLY GRANT the petition. The March 26, 2010 decision
and March 15, 2011 resolution of the Court of Appeals in CA-G.R. CV No. 89235 are
hereby AFFIRMED with the MODIFICATION that the parties entered into a contract of sale, not a

13
 donation, and that petitioner Elma Pidlaoan sold the whole disputed property to respondent
Normita Jacob Pidlaoan. Costs against the petitioners.
SO ORDERED. (Victoria v. Pidlaoan, G.R. No. 196470, [April 20, 2016], 785 PHIL 476-
491)

THIRD DIVISION
[G.R. No. 204700. April 10, 2013.]
EAGLERIDGE DEVELOPMENT CORPORATION, MARCELO N. NAVAL and
CRISPIN I. OBEN, petitioners,vs.CAMERON GRANVILLE 3 ASSET
MANAGEMENT, INC., respondent.
DECISION
LEONEN, J p:
All documents mentioned in a Deed of Assignment transferring the credit of the plaintiff in a
pending litigation should be accessible to the defendant through a Motion for Production or Inspection
of Documents under Rule 27 of the Rules of Court. Litigation is not a game of skills and stratagems. It
is a social process that should allow both parties to fully and fairly access the truth of the matters in
litigation.
Before this Court is a Petition under Rule 45, seeking to review the August 29, 2012 1 and
November 27, 2012 2 Resolutions of the Third Division of the Court of Appeals. The Resolutions
dismissed petitioners' Rule 65 Petition and affirmed the Resolutions dated March 28, 2012 3 and May
28, 2012 4 of the Regional Trial Court, Branch 60, Makati City denying petitioners' motion for
production/inspection.
The pertinent facts are as follows: 5
Petitioners Eagleridge Development Corporation (EDC), and sureties Marcelo N. Naval (Naval)
and Crispin I. Oben (Oben) are the defendants in a collection suit initiated by Export and Industry
Bank (EIB) through a Complaint 6 dated February 9, 2005, and currently pending proceedings before
the Regional Trial Court (RTC), Branch 60, Makati City. 7
By virtue of a Deed of Assignment 8 dated August 9, 2006, EIB transferred EDC's outstanding
loan obligations of P10,232,998.00 to respondent Cameron Granville 3 Asset Management, Inc.
(Cameron), a special purpose vehicle, thus:
For value received and pursuant to the (a) Loan Sale and Purchase Agreement
dated as of 7 April 2006 (the "LSPA"),made and executed by Export and Industry
Bank,as Seller ("Seller"),and by Cameron Granville Asset Management (SPV-
AMC),Inc. (the "Purchaser"),and (b) the Deed of Absolute Sale dated 9 August 2006
(the "Deed") made and executed by and between Seller and Purchaser, Seller hereby
absolutely sells, assigns and conveys to Purchaser, on a "without recourse" basis, all
of its rights, title and interests in the following Loan: TCacIE
EAGLERIDGE DEVELOPMENT CORPORATION with an outstanding loan
obligation of Php10,232,998.00 covered by an unregistered Deed of Assignment
of Receivables.
xxx xxx xxx
Defined terms used but not otherwise defined herein have the meaning
given to them in the LSPA. 9
Thereafter, Cameron filed its Motion to Substitute/Join EIB dated November 24, 2006, which
was granted by the trial court.
On February 22, 2012, petitioners filed a Motion for Production/Inspection 10 of the Loan Sale
and Purchase Agreement (LSPA) dated April 7, 2006 referred to in the Deed of Assignment.
Respondent Cameron filed its Comment 11 dated March 14, 2012 alleging that petitioners
have not shown "good cause" for the production of the LSPA and that the same is allegedly irrelevant
to the case a quo.
In response, petitioners filed on March 26, 2012 their Reply. 12 Petitioners explained that the
production of the LSPA was for "good cause". They pointed out that the claim of Cameron is based
on an obligation purchased after litigation had already been instituted in relation to it. They claimed
that pursuant to Article 1634 of the New Civil Code 13 on assignment of credit, the obligation subject
of the case a quo is a credit in litigation, which may be extinguished by reimbursing the assignee of

14
the price paid therefor, the judicial costs incurred and the interest of the price from the day on which
the same was paid. Article 1634 provides:
When a credit or other incorporeal right in litigation is sold, the debtor shall
have a right to extinguish it by reimbursing the assignee for the price the latter paid
therefor, the judicial costs incurred by him, and the interest on the price from the day
on which the same was paid.
As petitioners' alleged loan obligations may be reimbursed up to the extent of the amount paid by
Cameron in the acquisition thereof, it becomes necessary to verify the amount of the
consideration from the LSPA, considering that the Deed of Assignment was silent on this
matter. DTIcSH
In its Resolution 14 dated March 28, 2012, the trial court denied petitioners' motion for
production for being utterly devoid of merit. It ruled that there was failure to show "good cause" for the
production of the LSPA and failure to show that the LSPA is material or contains evidence relevant to
an issue involved in the action.
Aggrieved, petitioners filed on April 25, 2012, their Motion for Reconsideration. 15 They argued
that the application of Article 1634 of the Civil Code is sanctioned by Section 12, Article III of Republic
Act No. 9182, otherwise known as the Special Purpose Vehicle Law (SPV Law). Section 12 provides:
SECTION 12. Notice and Manner of Transfer of Assets. — (a) No transfer of
NPLs to an SPV shall take effect unless the FI concerned shall give prior notice,
pursuant to the Rules of Court, thereof to the borrowers of the NPLs and all persons
holding prior encumbrances upon the assets mortgaged or pledged. Such notice shall
be in writing to the borrower by registered mail at their last known address on file with
the FI. The borrower and the FI shall be given a period of at most ninety (90) days
upon receipt of notice, pursuant to the Rules of Court, to restructure or renegotiate the
loan under such terms and conditions as may be agreed upon by the borrower and the
FIs concerned.
(b) The transfer of NPAs from an FI to an SPV shall be subject to prior certification of
eligibility as NPA by the appropriate regulatory authority having jurisdiction over its
operations which shall issue its ruling within forty-five (45) days from the date of
application by the FI for eligibility.
(c) After the sale or transfer of the NPLs, the transferring FI shall inform the borrower
in writing at the last known address of the fact of the sale or transfer of the NPLs.
They alleged that the production of the LSPA — which would inform them of the consideration
for the assignment of their loan obligation — is relevant to the disposition of the case.
Respondent Cameron filed its Comment/Opposition 16 dated April 30, 2012 reiterating that the
production of the LSPA was immaterial, to which, petitioners filed, on May 14, 2012,
their Reply. 17 Petitioners insisted the materiality of inquiring about the contents of the LSPA,as the
consideration for any transfer of the loan obligation of petitioner EDC should be the basis for the claim
against them. HEScID
The trial court denied petitioners' motion for reconsideration in its Resolution dated May 28,
2012.
On July 27, 2012, petitioners filed their Petition for Certiorari with the Court of Appeals (CA),to
nullify and/or set aside the RTC's Resolutions dated March 28, 2012 and May 28, 2012.
In its Resolution dated August 29, 2012, the CA (Third Division) dismissed the petition for lack
of petitioner Oben's verification and certification against forum shopping and failure to attach a copy
of the complaint.
Petitioners' subsequent motion for reconsideration 18 dated September 20, 2012, was likewise
denied in the CA's November 27, 2012 Resolution.
Hence this instant petition.
The resolution of this case revolves around the following issues: (1) whether the CA erred in
dismissing the petition on technicality, i.e.,on a defective verification and certification against forum
shopping and the attachment to the petition of a mere machine copy of the complaint; and (2)
whether the RTC gravely abused its discretion in denying the production and/or inspection of
the LSPA.

15
 We agree with petitioner, that the appellate court erred in ruling that Oben's Verification and
Certification was defective for lack of a Board Resolution authorizing Oben to sign on behalf of
petitioner EDC. Oben executed and signed the Verification and Certification in his personal capacity
as an impleaded party in the case, and not as a representative of EDC. We note that an earlier
Verification and Certification signed by Naval, for himself and as a representative of EDC, and a
Secretary Certificate containing his authority to sign on behalf of EDC, were already filed with the
appellate court together with the petition for certiorari. 19 As such, what was only lacking was Oben's
Verification and Certification as pointed out in the August 29, 2012 Resolution of the CA. cADEHI
On the other hand, contrary to petitioners' assertion, a reading of the CA Resolution dated
November 27, 2012 shows that the appellate court merely noted the belated attachment of a machine
copy, not a certified true copy, of the complaint to petitioners' motion for reconsideration. Although not
expressly stated, the machine copy of the complaint is in fact acceptable, as Rule 65 provides that
one may attach to the petition mere machine copies of other relevant documents and
pleadings. 20 More importantly, the CA's dismissal of the petition for certiorari was anchored on its
finding that there was no grave abuse of discretion on the part of the RTC in denying the production
of the LSPA, that the errors committed by Judge Ruiz were, if at all, mere errors of judgment
correctible not by the extraordinary writ of certiorari and an ordinary appeal would still be available in
the action below for sum of money. 21
An appeal would not have adequately remedied the situation because, in that case, the court
would have rendered its decision without giving the petitioners the opportunity to make use of the
information that the LSPA would have supplied as a result of the court allowing the production of
the LSPA.If, on appeal, public respondent reversed its decision, the reversal would result in the case
being retried in the lower court, which would unnecessarily delay the resolution of the case and
burden the parties with additional litigation expense.
Having resolved the issue on the supposed technical defects, we go on to discuss the second
issue.
Section 1, Rule 27 of the 1997 Rules of Court, states:
Section 1. Motion for production or inspection; order.— Upon motion of any
party showing good cause therefor, the court in which an action is pending may a)
order any party to produce and permit the inspection and copying or photographing,
by or on behalf of the moving party, of any designated documents, papers, books,
accounts, letters, photographs, objects or tangible things, not privileged, which
constitute or contain evidence material to any matter involved in the action and which
are in his possession, custody or control; ...
The provision on production and inspection of documents is one of the modes of discovery
sanctioned by the Rules of Court in order to enable not only the parties, but also the court to discover
all the relevant and material facts in connection with the case pending before it. 22 HDCTAc
Generally, the scope of discovery is to be liberally construed so as to provide the litigants with
information essential to the fair and amicable settlement or expeditious trial of the case. 23 All the
parties are required to lay their cards on the table so that justice can be rendered on the merits of the
case. 24
Although the grant of a motion for production of document is admittedly discretionary on the
part of the trial court judge, nevertheless, it cannot be arbitrarily or unreasonably denied because to
do so would bar access to relevant evidence that may be used by a party-litigant and hence, impair
his fundamental right to due process. 25
The test to be applied by the trial judge in determining the relevancy of documents and the
sufficiency of their description is one of reasonableness and practicability. 26
According to the trial court, there is no need for the production of the LSPA in order to apprise
the petitioners of the amount of consideration paid by respondent in favor of EIB and that it is enough
that the Deed of Assignment has been produced by Cameron showing that it has acquired the
account of the petitioners pursuant to the SPV Law. 27
We find the Petition impressed with merit.
The question was whether respondent had acquired a valid title to the credit, i.e.,EDC's
outstanding loan obligation, and whether it had a right to claim from petitioners. In fact, petitioners
had maintained in their motions before the trial court the nullity or non-existence of the assignment of
credit purportedly made between respondent and EIB (the original creditor).

16
 As respondent Cameron's claim against the petitioners relies entirely on the validity of
the Deed of Assignment, it is incumbent upon respondent Cameron to allow petitioners to inspect all
documents relevant to the Deed, especially those documents which, by express terms, were referred
to and identified in the Deed itself. The LSPA, which pertains to the same subject matter — the
transfer of the credit to respondent is manifestly useful to petitioners' defense. DEHcTI
Furthermore, under Section 17, Rule 132 of the 1997 Rules of Court, when part of a writing or
record is given in evidence by one party, the whole of the same subject may be inquired into by the
other, and when a detached writing or record is given in evidence, any other writing or record
necessary to its understanding may also be given in evidence. Since the Deed of Assignment was
produced in court by respondent and marked as one of its documentary exhibits, the LSPA which was
made a part thereof by explicit reference and which is necessary for its understanding may also be
inevitably inquired into by petitioners.
In this light, the relevance of the LSPA sought by petitioners is readily apparent. Fair play
demands that petitioners must be given the chance to examine the LSPA. Besides, we find no great
practical difficulty, and respondent did not allege any, in presenting the document for inspection and
copying of the petitioners.
Incidentally, the legal incidents of the case a quo necessitates the production of said LSPA.
Section 13 of the SPV Law clearly provides that "in the transfer of the Non-Performing Loans
(NPLs), the provisions on subrogation and assignment of credits under the New Civil Code shall
apply." The law does not exclude the application of Article 1634 of the New Civil Code to transfers of
NPLs by a financial institution to a special purpose vehicle. Settled is the rule in statutory construction
that "when the law is clear, the function of the courts is simple application." Besides, it is within the
power of an SPV to restructure, condone, and enter into other forms of debt settlement involving
NPLs.
Also, Section 19 of the SPV Law expressly states that redemption periods allowed to
borrowers under the banking law, the rules of court and/or other laws are applicable. Hence, the
equitable right of redemption allowed to a debtor under Article 1634 of the Civil Code is
applicable. cDEICH
Therefore, as petitioners correctly pointed out, they have the right of legal redemption by
paying Cameron the transfer price plus the cost of money up to the time of redemption and the
judicial costs.
Certainly, it is necessary for the petitioners to be informed of the actual consideration paid by
the SPV in its acquisition of the loan, because it would be the starting point for them to negotiate for
the extinguishment of their obligation. As pointed out by the petitioners, since the Deed of
Assignment merely states "For value received", the appropriate information may be supplied by
the LSPA. It is self-evident that in order to be able to intelligently match the price paid by respondent
for the acquisition of the loan, petitioner must be provided with the necessary information to enable it
to make a reasonably informed proposal. Because of the virtual refusal and denial of the production
of the LSPA,petitioners were never accorded the chance to reimburse respondent of the
consideration the latter has paid.
Consequently, this Court finds and so holds that the denial of the Motion for Production despite
the existence of "good cause," relevancy and materiality for the production of the LSPA was
unreasonable and arbitrary constituting grave abuse of discretion on the part of the trial court.
Hence, certiorari properly lies as a remedy in the present case.
Discretionary acts will be reviewed where the lower court or tribunal has acted without or in
excess of its jurisdiction, where an interlocutory order does not conform to the essential requirements
of law and may reasonably. cause material injury throughout subsequent proceedings for which the
remedy of appeal will be inadequate, or where there is a clear or serious abuse of discretion. 28 The
exercise of discretion pertaining to discovery will be set aside where there is abuse, or the trial court's
disposition of matters of discovery was improvident and affected adversely the substantial rights of a
party. 29 After all, the discretion conferred upon trial courts is a sound discretion which should be
exercised with due regard to the rights of the parties and the demands of equity and justice. 30
Indeed, the insistent refusal of respondent to produce the LSPA is perplexing and
unacceptable to this Court. Respondent even asserts that if petitioner EDC thinks that the LSPA will
bolster its defense, then it should secure a copy of the document from the Bangko Sentral ng
Pilipinas and not from respondent, because allegedly the document was not marked by respondent
as one of its exhibits. 31 IcDHaT

17
 In light of the general philosophy of full discovery of relevant facts, the unreceptive and
negative attitude by the respondent is abominable. The rules on discovery are accorded broad and
liberal interpretation precisely to enable the parties to obtain the fullest possible knowledge of the
issues and facts, including those known only to their adversaries, in order that trials may not be
carried on in the dark. 32
Undoubtedly, the trial court had effectively placed petitioners at a great disadvantage
inasmuch as respondent effectively suppressed relevant documents related to the transaction
involved in the case a quo. Furthermore, the remedies of discovery encouraged and provided for
under the Rules of Court to be able to compel the production of relevant documents had been put to
naught by the arbitrary act of the trial court.
It must be remembered that "litigation is essentially an abiding quest for truth undertaken not
by the judge alone, but jointly with the parties. Litigants, therefore, must welcome every opportunity to
achieve this goal; they must act in good faith to reveal documents, papers and other pieces of
evidence material to the controversy." 33 Courts, as arbiters and guardians of truth and justice, must
not countenance any technical ploy to the detriment of an expeditious settlement of the case or to a
fair, full and complete determination on its merits.
WHEREFORE,the instant petition is GRANTED.The August 29, 2012 and November 27, 2012
resolutions of the Court of Appeals are REVERSED and SET ASIDE,and respondents
are ORDERED to produce the Loan Sale and Purchase Agreement dated April 7, 2006, including its
annexes and/or attachments, if any, in order that petitioners may inspect and/or photocopy the same.
SO ORDERED.
||| (Eagleridge Development Corp. v. Cameron Granville 3 Asset Management, Inc., G.R. No. 204700,
[April 10, 2013], 708 PHIL 693-709)

SPECIAL THIRD DIVISION

[G.R. No. 204700. November 24, 2014.]
EAGLERIDGE DEVELOPMENT CORPORATION, MARCELO N. NAVAL and
CRISPIN I. OBEN, petitioners, vs. CAMERON GRANVILLE 3 ASSET
MANAGEMENT, INC., respondent.
RESOLUTION
LEONEN, J p:
For resolution is respondent Cameron Granville 3 Asset Management, Inc.'s motion for
reconsideration 1 of our April 10, 2013 decision, 2 which reversed and set aside the Court of
Appeals' resolutions 3 and ordered respondent to produce the Loan Sale and Purchase
Agreement (LSPA) dated April 7, 2006, including its annexes and/or attachments, if any, in order
that petitioners may inspect or photocopy the same.
Petitioners Eagleridge Development Corporation, Marcelo N. Naval, and Crispin I. Oben
filed on June 7, 2013 their motion to admit attached opposition. 4 Subsequently, respondent filed
its reply 5 and petitioners their motion to admit attached rejoinder. 6
The motion for reconsideration raises the following points:
(1) The motion for production was filed out of time; 7
(2) The production of the LSPA would violate the parol evidence rule; and 8
(3) The LSPA is a privileged and confidential document. 9
Respondent asserts that there was no "insistent refusal" on its part to present the LSPA,
but that petitioners filed their motion for production way out of time, even beyond the protracted
pre-trial period from September 2005 to 2011. 10 Hence, petitioners had no one to blame but
themselves when the trial court denied their motion as it was filed only during the trial proper. 11
Respondent further submits that "Article 1634 [of the] Civil Code had been inappropriately
cited by [p]etitioners" 12 inasmuch as it is Republic Act No. 9182 (Special Purpose Vehicle Act)
that is applicable. 13 Nonetheless, even assuming that Article 1634 is applicable, respondent
argued that petitioners are: 1) still liable to pay the whole of petitioner Eagleridge Development
Corporation's (EDC) loan obligation, i.e., P10,232,998.00 exclusive of interests and/or
damages; 14 and 2) seven (7) years late in extinguishing petitioner EDC's loan obligation because
pursuant to Article 1634, they should have exercised their right of extinguishment within 30 days
from the substitution of Export and Industry Bank or EIB (the original creditor) by respondent in

18
December 2006. 15 According to respondent, the trial court order "granting the substitution
constituted sufficient judicial demand as contemplated under Article 1634." 16
Also, maintaining that the LSPA is immaterial or irrelevant to the case, respondent
contends that the "[o]rder of substitution settled the issue of [respondent's] standing before the
[c]ourt and its right to fill in the shoes of [EIB]." 17 It argues that the production of the LSPA will
neither prevent respondent from pursuing its claim of P10,232,998.00, exclusive of interests and
penalties, from petitioner EDC, nor write off petitioner EDC's liability to respondent. 18 The
primordial issue of whether petitioners owe respondent a sum of money via the deed of
assignment can allegedly "be readily resolved by application of Civil Code provisions and/or
applicable jurisprudence and not by the production/inspection of the LSPA[.]" 19 Respondent also
argues that "a consideration is not always a requisite [in assignment of credits, and] an assignee
may maintain an action based on his title and it is immaterial whether or not he paid any
consideration [therefor][.]" 20 HASTCa
Respondent also contends that: (1) the production of the LSPA will violate the parol
evidence rule 21 under Rule 130, Section 9 of the Rules of Court; (2) the LSPA is a
privileged/confidential bank document; 22 and (3) under the Special Purpose Vehicle Act, "the
only obligation of both the assignor (bank) and the assignee (the SPV; respondent Cameron) is to
give notice to the debtor (Eagleridge, Naval, and Oben) that its account has been
assigned/transferred to a special purpose vehicle (Sec. 12, R.A. 9182) [and] [i]t does not require
of the special purpose vehicle or the bank to disclose all financial documents included in the
assignment/sale/transfer[.]" 23
Finally, respondent points out that the deed of assignment is a contested document. "Fair
play would be violated if the LSPA is produced without [p]etitioners acknowledging that
respondent Cameron Granville 3 Asset Management, Inc. is the real party-in-interest because
petitioners . . . would [thereafter] use . . . the contents of a document (LSPA) to its benefit while at
the same time" 24 refuting the integrity of the deed and the legal personality of respondent to sue
petitioners. 25
For their part, petitioners counter that their motion for production was not filed out of time,
and "[t]here is no proscription, under Rule 27 or any provision of the Rules of Court, from filing
motions for production, beyond the pre-trial." 26
Further, assuming that there was a valid transfer of the loan obligation of petitioner EDC,
Article 1634 is applicable and, therefore, petitioners must be informed of the actual transfer price,
which information may only be supplied by the LSPA. 27 Petitioners argue that the substitution of
respondent in the case a quo was "not sufficient 'demand' as contemplated under Article 1634 of
the Civil Code inasmuch as respondent Cameron failed . . . to inform petitioner EDC of the price it
paid for the [transfer of the] loan obligation," 28 which made it "impossible for petitioners to
reimburse what was paid for the acquisition of the . . . loan obligation [of EDC]." 29 Additionally,
petitioners contend that respondent was not a party to the deed of assignment, but Cameron
Granville Asset Management (SPV-AMC), Inc., hence, "as [to] the actual parties to the Deed of
Assignment are concerned, no such demand has yet been made." 30
Petitioners add that the amount of their liability to respondent is one of the factual issues to
be resolved as stated in the November 21, 2011 pre-trial order of the Regional Trial Court, which
makes the LSPA clearly relevant and material to the disposition of the case. 31
Petitioners next argue that the parol evidence rule is not applicable to them because they
were not parties to the deed of assignment, and "they cannot be prevented from seeking evidence
to determine the complete terms of the Deed of Assignment." 32 Besides, the deed of assignment
made express reference to the LSPA, hence, the latter cannot be considered as extrinsic to it. 33
As to respondent's invocation that the LSPA is privileged/confidential, petitioners counter
that "it has not been shown that the parties fall under . . . or, at the very least . . . analogous to
[any of the relationships enumerated in Rule 130, Section 124] that would exempt [respondent]
from disclosing information as to their transaction." 34
In reply, respondent argues that "[petitioners] cannot accept and reject the same instrument
at the same time." 35 According to respondent, by allegedly "uphold[ing] the truth of the contents
as well as the validity of [the] Deed of Assignment [in] seeking the production of the
[LSPA]," 36 petitioners could no longer be allowed to impugn the validity of the same deed. 37
In their rejoinder, petitioners clarified that their consistent position was always to assail the
validity of the deed of assignment; that alternatively, they invoked the application of Article 1634
should the court uphold the validity of the transfer of their alleged loan obligation; and that Rule 8,
Section 2 of the Rules of Court "permits parties to set forth alternative causes of action or
defenses." 38
We deny the motion for reconsideration.
19
Discovery mode of production/inspection of document may be availed of even beyond
pretrial upon a showing of good cause
The availment of a motion for production, as one of the modes of discovery, is not limited to
the pre-trial stage. Rule 27 does not provide for any time frame within which the discovery mode
of production or inspection of documents can be utilized. The rule only requires leave of court
"upon due application and a showing of due cause." 39 Rule 27, Section 1 of the 1997 Rules of
Court, states:
SECTION 1. Motion for production or inspection order. — Upon motion of
any party showing good cause therefor the court in which an action is pending may (a)
order any party to produce and permit the inspection and copying or photographing,
by or on behalf of the moving party, of any designated documents, papers, books,
accounts, letters, photographs, objects or tangible things, not privileged, which
constitute or contain evidence material to any matter involved in the action and which
are in his possession, custody or control[.] (Emphasis supplied)
In Producers Bank of the Philippines v. Court of Appeals, 40 this court held that since
the rules are silent as to the period within which modes of discovery (in that case, written
interrogatories) may still be requested, it is necessary to determine: (1) the purpose of discovery;
(2) whether, based on the stage of the proceedings and evidence presented thus far, allowing it is
proper and would facilitate the disposition of the case; and (3) whether substantial rights of parties
would be unduly prejudiced. 41 This court further held that "[t]he use of discovery is encouraged,
for it operates with desirable flexibility under the discretionary control of the trial court." 42 DIAcTE
In Dasmariñas Garments, Inc. v. Reyes, 43 this court declared that depositions, as a mode
of discovery, "may be taken at any time after the institution of any action [as there
is] no prohibition against the taking of depositions after pre-trial." 44 Thus:
Dasmariñas also contends that the "taking of deposition is a mode of pretrial
discovery to be availed of before the action comes to trial." Not so. Depositions may
be taken at any time after the institution of any action, whenever necessary or
convenient. There is no rule that limits deposition-taking only to the period of pre-trial
or before it; no prohibition against the taking of depositions after pre-trial. Indeed, the
law authorizes the taking of depositions of witnesses before or after an appeal is taken
from the judgment of a Regional Trial Court "to perpetuate their testimony for use in
the event of further proceedings in the said court" (Rule 134, Rules of Court), and
even during the process of execution of a final and executory judgment (East Asiatic
Co. v. C.I.R., 40 SCRA 521, 544). 45
"The modes of discovery are accorded a broad and liberal treatment." 46 The evident
purpose of discovery procedures is "to enable the parties, consistent with recognized privileges, to
obtain the fullest possible knowledge of the issues and facts before civil trials" 47 and, thus,
facilitating an amicable settlement or expediting the trial of the case. 48
Technicalities in pleading should be avoided in order to obtain substantial justice. In Mutuc
v. Judge Agloro, 49 this court directed the bank to give Mutuc a complete statement as to how his
debt was computed, and should he be dissatisfied with that statement, pursuant to Rule 27 of
the Rules of Court, to allow him to inspect and copy bank records supporting the items in that
statement. 50 This was held to be "in consonance with the rules on discovery and the avowed
policy of the Rules of Court . . . to require the parties to lay their cards on the table to facilitate a
settlement of the case before the trial." 51
We have determined that the LSPA is relevant and material to the issue on the validity of
the deed of assignment raised by petitioners in the court a quo, and allowing its production and
inspection by petitioners would be more in keeping with the objectives of the discovery rules. We
find no great practical difficulty, and respondent continuously fails to allege any, in presenting the
document for inspection and copying of petitioners. On the other hand, to deny petitioners the
opportunity to inquire into the LSPA would bar their access to relevant evidence and impair their
fundamental right to due process. 52
Article 1634 of the New Civil Code is applicable
Contrary to respondent's stance, Article 1634 of the Civil Code on assignment of credit in
litigation is applicable.
Section 13 of the Special Purpose Vehicle Act clearly provides that in the transfer of the
non-performing loans to a special purpose vehicle, "the provisions on subrogation and assignment
of credits under the New Civil Code shall apply." Thus:
Sec. 13. Nature of Transfer. — All sales or transfers of NPAs to an SPV shall
be in the nature of a true sale after proper notice in accordance with the procedures as
20
 provided for in Section 12: Provided, That GFIs and GOCCs shall be subject to
existing law on the disposition of assets: Provided, further, That in the transfer of the
NPLs, the provisions on subrogation and assignment of credits under the New Civil
Code shall apply.
Furthermore, Section 19 of the Special Purpose Vehicle Act expressly states that
redemption periods allowed to borrowers under the banking law, the Rules of Court, and/or other
laws are applicable. Hence, the right of redemption allowed to a debtor under Article 1634 of
the Civil Code is applicable to the case a quo.
Accordingly, petitioners may extinguish their debt by paying the assignee-special purpose
vehicle the transfer price plus the cost of money up to the time of redemption and the judicial
costs.
Petitioners' right to extinguish their debt has not yet lapsed
Petitioners' right to extinguish their debt under Article 1634 on assignment of credits has
not yet lapsed. The pertinent provision is reproduced here:
Art. 1634. When a credit or other incorporeal right in litigation is sold, the debtor
shall have a right to extinguish it by reimbursing the assignee for the price the latter
paid therefor, the judicial costs incurred by him, and the interest on the price from the
day on which the same was paid.
A credit or other incorporeal right shall be considered in litigation from the time
the complaint concerning the same is answered.
The debtor may exercise his right within thirty days from the date the assignee
demands payment from him. (Emphasis supplied)
Under the last paragraph of Article 1634, the debtor may extinguish his or her debt within
30 days from the date the assignee demands payment. In this case, insofar as the actual parties
to the deed of assignment are concerned, no demand has yet been made, and the 30-day period
did not begin to run. Indeed, petitioners assailed before the trial court the validity of the deed of
assignment on the grounds that it did not comply with the mandatory requirements of the Special
Purpose Vehicle Act, 53 and it referred to Cameron Granville Asset Management (SPV-AMC),
Inc., as the assignee, and not respondent Cameron Granville 3 Asset Management, Inc. 54
The law requires that payment should be made only "to the person in whose favor the
obligation has been constituted, or his [or her] successor in interest, or any person authorized to
receive it." 55 It was held that payment made to a person who is not the creditor, his or her
successor-in-interest, or a person who is authorized to receive payment, even through error or
good faith, is not effective payment which will bind the creditor or release the debtor from the
obligation to pay. 56 Therefore, it was important for petitioners to determine for sure the proper
assignee of the EIB credit or who to pay, in order to effectively extinguish their debt.
Moreover, even assuming that respondent is the proper assignee of the EIB credit,
petitioners could not exercise their right of extinguishment because they were not informed of the
consideration paid for the assignment. 57
Respondent must, pursuant to Article 1634 of the Civil Code, disclose how much it paid to
acquire the EIB credit, so that petitioners could make the corresponding offer to pay, by way of
redemption, the same amount in final settlement of their obligation. HITEaS
Respondent insists that the transfer price of the EIB credit is P10,232,998.00 (the actual
amount and value of the credit), and that petitioners should have paid the said amount within 30
days from the December 8, 2006 order of the Regional Trial Court approving its substitution of
EIB. 58 Petitioners believe otherwise, and as the deed of assignment was silent on the matter, it
becomes necessary to verify the amount of the consideration from the LSPA.
Assuming indeed that respondent acquired the EIB credit for a lesser consideration, it
cannot compel petitioners to pay or answer for the entire original EIB credit, or more than what it
paid for the assignment.
Under the circumstances of this case, the 30-day period under Article 1634 within which
petitioners could exercise their right to extinguish their debt should begin to run only from the time
they were informed of the actual price paid by the assignee for the transfer of their debt.
Parol evidence rule is not applicable
Claiming further the impropriety of allowing the production of the LSPA, respondent
contends that the presentation of the document and its annexes would violate the parol
evidence rule in Rule 130, Section 9:

21
 SEC. 9. Evidence of written agreements. — When the terms of an agreement
have been reduced to writing, it is considered as containing all the terms agreed upon
and there can be, between the parties and their successors in interest, no evidence of
such terms other than the contents of the written agreement.
However, a party may present evidence to modify, explain or add to the terms
of the written agreement if he puts in issue in his pleading:
(a) An intrinsic ambiguity, mistake or imperfection in the written agreement;
(b) The failure of the written agreement to express the true intent and
agreement of the parties thereto;
(c) The validity of the written agreement; or
(d) The existence of other terms agreed to by the parties or their successors in
interest after the execution of the written agreement.
The term "agreement" includes wills.
We disagree.
The parol evidence rule does not apply to petitioners who are not parties to the deed of
assignment and do not base a claim on it. 59 Hence, they cannot be prevented from seeking
evidence to determine the complete terms of the deed of assignment.
Even assuming that Rule 130, Section 9 is applicable, an exception to the rule under the
second paragraph is when the party puts in issue the validity of the written agreement, as in the
case a quo.
Besides, what is forbidden under the parol evidence rule is the presentation of oral or
extrinsic evidence, not those expressly referred to in the written agreement. "[D]ocuments can be
read together when one refers to the other." 60 By the express terms of the deed of assignment, it
is clear that the deed of assignment was meant to be read in conjunction with the LSPA.
As we have stated in our decision, Rule 132, Section 17 61 of the Rules of Court allows a
party to inquire into the whole of the writing or record when a part of it is given in evidence by the
other party. Since the deed of assignment was produced in court by respondent and marked as
one of its documentary exhibits, the LSPA which was made a part thereof by explicit reference
and which is necessary for its understanding may also be inquired into by petitioners.
The LSPA is not privileged and confidential in nature
Respondent's contention that the LSPA is privileged and confidential is likewise untenable.
Indeed, Rule 27 contains the proviso that the documents sought to be produced and
inspected must not be privileged against disclosure. Rule 130, Section 24 describes the types of
privileged communication. These are communication between or involving the following: (a)
between husband and wife; (b) between attorney and client; (c) between physician and patient; (d)
between priest and penitent; and (e) public officers and public interest.
Privileged communications under the rules of evidence is premised on an accepted need to
protect a trust relationship. It has not been shown that the parties to the deed of assignment fall
under any of the foregoing categories.
This court has previously cited other privileged matters such as the following: "(a) editors
may not be compelled to disclose the source of published news; (b) voters may not be compelled
to disclose for whom they voted; (c) trade secrets; (d) information contained in tax census returns;
. . . (d) bank deposits" 62 (pursuant to the Secrecy of Bank Deposits Act); (e) national security
matters and intelligence information; 63 and (f) criminal matters. 64 Nonetheless, the LSPA does
not fall within any of these classes of information. Moreover, the privilege is not absolute, and the
court may compel disclosure where it is indispensable for doing justice.
At any rate, respondent failed to discharge the burden of showing that the LSPA is a
privileged document. Respondent did not present any law or regulation that considers bank
documents such as the LSPA as classified information. Its contention that the Special Purpose
Vehicle Act 65 only requires the creditor-bank to give notice to the debtor of the transfer of his or
her account to a special purpose vehicle, and that the assignee-special purpose vehicle
has no obligation to disclose other financial documents related to the sale, is untenable. The
Special Purpose Vehicle Act does not explicitly declare these financial documents as privileged
matters. Further, as discussed, petitioners are not precluded from inquiring as to the true
consideration of the assignment, precisely because the same law in relation to Article 1634 allows

22
 the debtor to extinguish its debt by reimbursing the assignee-special purpose vehicle of the actual
price the latter paid for the assignment.
An assignment of a credit "produce[s] no effect as against third persons, unless it appears
in a public instrument[.]" 66 It strains reason why the LSPA, which by law must be a public
instrument to be binding against third persons such as petitioners-debtors, is privileged and
confidential.
Alternative defenses are allowed under the Rules
Finally, respondent's contention that petitioners cannot claim the validity and invalidity of
the deed of assignment at the same time is untenable.
The invocation by petitioners of Article 1634, which presupposes the validity of the deed of
assignment or the transfer of the EIB credit to respondent, even if it would run counter to their
defense on the invalidity of the deed of assignment, is proper and sanctioned by Rule 8, Section 2
of the Rules of Court, which reads:
SEC. 2. Alternative causes of action or defenses. — A party may set forth two
or more statements of a claim or defense alternatively or hypothetically, either in one
cause of action or defense or in separate causes of action or defenses. When two or
more statements are made in the alternative and one of them if made independently
would be sufficient, the pleading is not made insufficient by the insufficiency of one or
more of the alternative statements. (Emphasis supplied)
All told, respondent failed to allege sufficient reasons for us to reconsider our decision.
Verily, the production and inspection of the LSPA and its annexes fulfill the discovery-procedures
objective of making the trial "less a game of blind man's buff and more a fair contest with the basic
issues and facts disclosed to the fullest practicable extent." 67
WHEREFORE, the motion for reconsideration is DENIED WITH FINALITY. DCHaTc
SO ORDERED.
||| (Eagleridge Development Corp. v. Cameron Granville 3 Asset Management, Inc., G.R. No. 204700
(Resolution), [November 24, 2014], 747 PHIL 791-811)

SECOND DIVISION
[G.R. No. 183872. November 17, 2014.]
OWEN PROSPER A. MACKAY, petitioner, vs. SPOUSES DANA CASWELL and
CERELINA CASWELL, respondents.
DECISION
DEL CASTILLO, J p:
This Petition for Review on Certiorari 1 assails the April 30, 2008 Decision 2 of the Court of
Appeals (CA) in CA-G.R. SP No. 97146 which granted the Petition for Review 3 filed therewith,
reversed and set aside the October 31, 2006 Decision 4 of the Regional Trial Court (RTC), Branch
70, Iba, Zambales in Civil Case No. RTC-2426-I, and reinstated the June 29, 2006 Decision 5 of
the Municipal Trial Court (MTC), San Narciso, Zambales in Civil Case No. 538. The MTC Decision
dismissed petitioner Owen Prosper A. Mackay's (Owen) claims against respondents spouses
Dana Caswell and Cerelina Caswell (the Caswells) and ordered him to pay the latter P46,205.00
representing the expenses they incurred for the rectification of the defective work he did for them.
The Petition also assails the July 24, 2008 Resolution 6 of the CA denying Owen's Motion for
Reconsideration 7 thereto.

Factual Antecedents
In their search for someone who could provide electrical installation service in their newly
built home in San Narciso, Zambales, the Caswells asked the sole distributor of electricity in the
area, Zambales II Electric Cooperative (Zameco II), thru its sub-office manager, Engr. Victor
Pulangco (Engr. Pulangco), how much its service for the installation would be. Engr. Pulangco
quoted an estimate of P456,000.00.
However, the Caswells hired Owen who offered to do the job for only P250,000.00. With
the help of Cesar Badua (Badua) and Albert Galeng, Owen claimed that the installation was
completed and ready for power service connection as of August 1998. By then, the Caswells had
paid him P227,000.00.
23
 At Cerelina Caswell's (Cerelina) request, Zameco II inspected the installation work and
tested the distribution transformers. 8 The inspection showed the following defects as specified in
Engr. Pulangco's letter dated August 11, 1998: 9
I. For A-5 Construction
a. No guying
b. Improper use of deadend materials for neutral line
c. Lack of armor tape
d. Lack of clamp loop deadend materials
e. No locknuts on all bolts. EDATSI
II. For A-2 construction
a. Improper use of materials for pole top pin
b. Lack of pole top pin
c. No guying
d. Improper use of materials for neutral line
e. Wrong phasing of pole top pin
f. Lack of armor rod (single & double support)
III. For Grounding:
a. [Substandard] grounding wire
b. Wrong installation of pole grounding wire
c. Lack of grounding rods
V. Tapping Point:
Lack of use cut-out with lightning arrester combination at the tapping point.
VI. For Transformer Installation:
Wrong distance of the transformer from the neutral line. 10
Because of the deficiencies and other incomplete requirements, Zameco II refused to
provide energization to the Caswell home. The Caswells thus looked for Owen but he could not be
found. Hence, they were constrained to ask Zameco II to correct all the problems it found. After
the single phase distribution system was completed in accordance with the standard specifications
of Zameco II in January 1999, 11 only then did the Caswells finally have electricity.
On September 4, 1998, the Caswells executed a Joint Affidavit 12 to charge Owen and his
group of swindling them of P227,000.00. The Caswells alleged that Owen and his group
misrepresented themselves to be people from the National Power Corporation (NAPOCOR). By
reason of the misrepresentation, the Caswells suffered damage as the electrical installation made
were replete with deficiencies such that no electricity can properly flow to their house. This led to
the filing of an Estafa case under Article 315 paragraph 2 (a) of the Revised Penal
Code 13 against Owen, docketed as Criminal Case No. RTC-2533-I. 14 However, on ground of
reasonable doubt, Owen was acquitted on May 15, 2003. 15
Still unpaid for the remaining P23,000.00 for his installation work, Owen in turn filed a
Complaint 16 for Collection of Sum of Money with Damages against the Caswells before the MTC,
docketed as Civil Case No. 538. TcHCIS
Owen alleged that out of the P250,000.00 contract price for the installation of an electrical
line, the Caswells have only paid him P227,000.00. He thus wanted to recover from the Caswells
the remaining balance of P23,000.00, as well as damages on account of sleepless nights, serious
anxiety and social humiliation he suffered due to the Caswells' malicious filing of estafa case
against him.
The Caswells, on the other hand, maintained that Owen is not entitled to any money. They
pointed out that Owen failed to finish the job and walked out of the contract. Hence, they are the
ones entitled to reimbursement of expenses incurred to correct Owen's defective work. As proof of
their expenses, the Caswells submitted as evidence a) Engr. Pulangco's handwritten receipt of
24
P15,400.00 as partial payment for the materials needed to correct the deficiencies in Owen's
installation work; 17 b) an undated Sales Invoice No. 2029 issued by Peter A. Eduria Enterprises
itemizing nine electrical materials, Dana Caswell (Dana) bought, their quantities, and the total
price of P53,805.00.00 n 18 and; c) a list of all the materials obtained for Zameco's corrective
work with the corresponding unit prices, labor cost and the total price charged. 19
Owen and Badua testified that they rectified all the discrepancies that Zameco II found.
After the corrections, Owen informed Engr. Pulangco that the Caswell home was ready for
electrical connection. He did not know what Engr. Pulangco did next. Owen likewise asserted that
he even reminded Cerelina to submit to Zameco II all the documentary requirements for power
connection. 20
Ruling of the Municipal Trial Court
Finding the contract entered into by the parties to be a contract for a piece of work, the
MTC relied upon Article 1715 of the Civil Code, viz.:
The contractor shall execute the work in such a manner that it has the qualities
agreed upon and has no defects which destroy or lessen its value or fitness for its
ordinary or stipulated use. Should the work be not of such quality, the employer may
require that the contractor remove the defect or execute another work. If the contractor
fails or refuses to comply with this obligation, the employer may have the defect
removed or another work executed, at the contractor's cost.
The MTC held that since it was proven that the work of Owen suffers from deficiencies, the
Caswells, pursuant to the above-quoted provision, have the right to require him to remove the
defect or execute another work. It did not give credence to Owen's claim that he corrected the
deficiencies for lack of evidence to substantiate the same. The MTC likewise held that the
Caswells had no chance to demand from Owen the removal of the defect or the execution of
another work as he was then nowhere to be found. On the other hand, the Caswells' evidence
clearly showed that they caused the Zameco II people to rectify the defects for which they spent
P69,205.00. DCaEAS
By virtue of Article 1167 21 of the Civil Code, the MTC ruled that the said P69,205.00
should be borne by Owen. From the P69,205.00, the said court then deducted the P23,000.00
Owen was seeking to collect from the Caswells. The dispositive portion of the MTC's June 29,
2006 Decision 22 reads:
WHEREFORE, viewed from all the foregoing, judgment is hereby rendered in
favor of the [Caswells] and against [Owen] as follows:
1. Dismissing [Owen's] claims for lack of merit, and
2. Ordering [Owen] to pay the [Caswells] the amount of P46,205.00
representing the rectification cost.
SO ORDERED. 23
Owen appealed to the RTC.
Ruling of the Regional Trial Court
In a Decision 24 dated October 31, 2006, the RTC reversed and set aside the MTC
Decision. The RTC opined that the Caswells should have first filed a judicial action for specific
performance where there could have been an exhaustive determination of the quality and
acceptability of Owen's installation work. By immediately resorting to the service of Zameco II, the
Caswells never afforded Owen the opportunity to correct the deficiencies in accordance with
Article 1715 of the Civil Code.It noted Cerelina's testimony during the trial before the MTC where
she was asked if she confronted Owen about the unfinished work. She answered that Owen did
not come to her so she went to Zameco II when she could no longer wait for electricity. 25
Furthermore, the RTC was convinced that Owen kept up his end of the bargain as shown
by Engr. Pulangco's testimony on cross-examination that even without replacing the fuse cut-out
connection, electricity will still flow smoothly and will function in the Caswell home. 26
Opining that Owen must be given what is actually due him, the RTC disposed of the case
as follows:
WHEREFORE, the decision of the Municipal Trial Court of San Narciso is
reversed and set aside and judgment is hereby rendered as follows:
1. Ordering the defendants to pay unto the plaintiff the amount of Twenty Three
Thousand Pesos (P23,000.00) representing the balance of the price or consideration
for his services in the installation of electrical lines in the defendants' home, with legal
25
 interest at the rate of six percent (6%) [per annum] from the time of the filing of the
complaint until it is fully paid;
2. Ordering the defendants to pay to the plaintiff moral damages in the amount
of TWENTY FIVE THOUSAND PESOS (P25,000.00) for their willful non-compliance
with their contractual obligation to the plaintiff, and exemplary damages in the amount
of TWENTY THOUSAND PESOS (P20,000.00) by way of example or correction for
the public good;
3. Ordering the defendants[,] spouses DANA and CERELINA CASWELL[,] to
pay attorney's fees to the plaintiff in the amount of THIRTY THOUSAND PESOS
(P30,000.00), the latter having been haled to court to enforce his contractual rights;
[4.] Ordering the defendants to pay the costs of this suit.
SO ORDERED. 27 HIETAc
Refusing to accept the RTC judgment and heavily relying on the MTC Decision, the
Caswells elevated the case to the CA by way of a Petition for Review. 28
Ruling of the Court of Appeals
In its Decision 29 of April 30, 2008, the CA reinstated the MTC Decision. It reasoned:
The RTC opined that [the Caswells] should have given the contractor the
chance to rectify the flaw in his work. To Our mind, however, the effort to
communicate with [Owen] effectively served as [the Caswells'] request for the former
to rectify the flaws in the contracted work. In fact, [the Caswells'] act of demanding that
[Owen] secure the permit and to subject the transformer to testing can already be
construed as a substantial compliance with Article 1715. It must be emphasized that it
was [Owen's] refusal to secure the necessary permits and to comply with the
requirements of Zameco [II] as well as his refusal to communicate with [the Caswells]
that impelled the latter to file a case for estafa against him. Had he been willing to
make good his obligation, then it would not have been necessary for [the Caswells] to
file the said criminal case. Instead of complying with his end of the bargain, [Owen]
opted to file a case for collection of sum of money with damages. Thus, any effort to
require [Owen] either to rectify his flawed work or to remove the same would have
been futile since [Owen's] act of demanding payment through the said complaint
showed his belief that his work in the house was done.
Clearly, the RTC erred in stating that [the Caswells'] failure to file an action for
specific performance led to the presumption that [Owen] performed his obligations in
accordance with their agreement. Said presumption could not have prevailed in view
of the nature of the contracted work, the ultimate goal of which was to have electricity
flowing into [the Caswell] house. Thus, the thing speaks for itself. Res ipsa
loquitur. This, the RTC failed to consider. Therefore, this Court finds the decision of
the MTC more in accord with law and jurisprudence. 30
His Motion for Reconsideration 31 having been denied by the CA, 32 Owen argues in this
Petition for Review on Certiorari that: 1) he has done the installation job and that it was not his
duty but that of the Caswells to secure the necessary permits from Zameco II; 2) his acquittal in
the criminal case should have been considered; 3) there is no basis for the award of the
rectification costs as the sales receipt for the alleged materials used is inadmissible and; 4) the
Caswells never demanded that he remove the defects or execute another work in accordance with
Article 1715 of the Civil Code. ACcDEa
Our Ruling
We deny the Petition.
Owen failed to execute his work in such a manner that it has no defects which destroy or lessen
its value or fitness for its ordinary or stipulated use.
Owen insists that as far as he is concerned, he had done what was required of him. i.e., the
installation of electrical materials in the Caswell home. Anent the permits, he avers that securing
the same is not part of his work but is the responsibility of the Caswells.
Considering all the undisputed facts, the Court, however, finds that the Caswells were not
only after securing permits. They suffered other major problems as shown by their narration in
their Joint Affidavit, viz.:
5. That we think they were done in three days, that same week. The contact
man, Owen Mackay, had told us that he would take care of all permits. He asked us to
26
 get a paper done for the permission on one piece of land. No permits were shown to
us. No ZAMECO authorization [was] ever shown to us. He went to ZAMECO, to tell
them it was ready [for connection]. ZAMECO did not connect because: (1) no permits
[were] requested or [were] given by ZAMECO; (2) transformer allegedly brand new
[and] had to run through testing laboratory. Owen['s] group [neither] did the testing nor
caused a testing; (3) complete inspection of installation was [yet] to be done . . .;
(4) no installation layout was provided or presented to ZAMECO; (5) nobody [from
Owen's group was] around for 4-5 days to . . . talk about our problems. Owen called,
sent word to [us] and we have gone down (3) occasions at night to try to find him. The
three did [a] vanishing act. Finally, [they came] to take the transformer for testing.
[The] one day testing told us by Pulangco turned into 1 1/2 weeks . . . . I had to go pick
it up myself at test complex. Brought the transformer home from Castillejos, August
[10,] 1998 with the test results. No response from the people who called themselves
NAPOCOR. After [chasing after] Owen Mackay . . . and [after] empty promises we
were referred to Atty. Pacis, [and] the rest is still unsettled; 33
These circumstances, together with the deficiencies enumerated in Engr. Pulangco's
August 10, 1998 letter, sufficiently explain the delay in the energization of the Caswell home.
Engr. Pulangco's testimony that electricity will still work without replacing the fuse cut-out
connection is not enough to negate the fact that Owen's overall work is not satisfactory.
Moreover, Owen, in contending that his acquittal in the estafa case should have been a
factor for a favorable decision in this civil case, relied on a remark by the RTC that referred to an
opinion mentioned in the judgment in the estafa case, i.e., that the delay in supplying power to the
Caswell home could possibly be due to the resentment harbored by certain employees of Zameco
II as they were not chosen to do the work. 34 A perusal, however, of the judgment in Criminal
Case No. RTC-2533-I 35 would show that this statement is only a mere obiter. The RTC cannot
hinge on this opinion as this is mere conjecture. Notably, the Zameco II people were not even
parties or witnesses in the estafa case. SDEHCc
Suffice it to say that Owen's job was not only to finish the electrical installation work. It was
likewise his obligation to do quality work and to provide quality materials to ensure that electricity
would flow in the Caswell home. For the Caswells to avail of this utility, it is definitely expected that
the electrical materials used should meet the technical requirements for a service entrance as
imposed by the only distributor of the electricity in the area, Zameco II, so that the latter can
supply residential electric service efficiently and safely to the Caswells. However, as shown
above, Owen failed to execute his work in such a manner that it has no defects which destroy or
lessen its value or fitness for its ordinary or stipulated use.
The CA correctly ruled that Caswells'
effort to communicate with Owen
effectively served as a demand to rectify
the latter's work.
Under Article 1715 of the Civil Code, if the work of a contractor has defects which destroy
or lessen its value or fitness for its ordinary or stipulated use, he may be required to remove the
defect or execute another work. If he fails to do so, he shall be liable for the expenses by the
employer for the correction of the work. The demand required of the employer under the subject
provision need not be in a particular form. In the case at bar, we agree with the CA that Owen was
given the opportunity to rectify his work. Subsequent to Zameco II's disapproval to supply the
Caswells electricity for several reasons, the Court gives credence to the latter's claim that they
looked for Owen to demand a rectification of the work, but Owen and his group were nowhere to
be found. Had Owen really been readily available to the Caswells to correct any deficiency in the
work, the latter would not have entertained the thought that they were deceived and would not
have been constrained to undergo the rigors of filing a criminal complaint and testifying therein.
Without doubt, the Caswells exercised due diligence when they demanded from Owen the proper
rectification of his work. As correctly held by the CA, the Caswells substantially complied with the
requirement of Article 1715 of the Civil Code, viz.:
To Our mind, however, the effort to communicate with [Owen] effectively served as
[the Caswells'] request for the former to rectify the flaws in the contracted work. In
fact, [the Caswells'] act of demanding that [Owen] secure the permit and to subject
the transformer to testing can already be construed as a substantial compliance with
Article 1715. It must be emphasized that it was [Owen's] refusal to secure the
necessary permits and to comply with the requirements of Zameco [II] as well as his
refusal to communicate with [the Caswells] that impelled the latter to file a case for
estafa against him. Had he been willing to make good his obligation, then it would
not have been necessary for [the Caswells] to file the said criminal case. Instead of
complying with his end of the bargain, [Owen] opted to file a case for collection of
27
 sum of money with damages. Thus, any effort to require [Owen] either to rectify his
flawed work or to remove the same would have been futile since [Owen's] act of
demanding payment through the said complaint showed his belief that his work in
the house was done. 36
Furthermore, to require the Caswells to file an action for specific performance, as opined by
the RTC, not only deprives them of hiring someone else to rectify the work, but also defeats the
very purpose of the contracted work, i.e., to immediately have electricity in their home. In this
situation, time is of the essence. EcATDH
For Owen's failure to provide quality work, he is to reimburse the rectification costs the Caswells
had shouldered as the latter's actual damages; the unpaid compensation Owen is claiming shall
be set-off from the Caswells' monetary claims supported by receipts.
The Court recognizes that in view of the substandard work done, the Caswells necessarily
incurred expenses by purchasing materials to finally get a supply of electricity in their home.
One is entitled to an adequate compensation only for such pecuniary loss suffered by him
as he has duly proved. 37 "To justify an award of actual damages, there must be competent proof
of the actual amount of loss, credence can be given only to claims which are duly supported by
receipts." 38 The claimant must prove the actual amount of loss with a reasonable degree of
certainty premised upon competent proof and on the best evidence obtainable. 39 In the case at
bar, we give credence to the documents relied upon by the CA and the MTC in arriving at the
rectification cost, i.e., a) Engr. Pulangco's handwritten receipt of P15,400.00, to which he had
testified before the court that he had indeed received such amount and b) the Sales Invoice No.
2029 issued by Peter A. Eduria Enterprises reflecting the total cost of P53,805.00.00. n
Notably, Owen assails the admissibility of the Sales Invoice, contending that said document
is insufficient to be a basis for computation of damages as the respective unit price for each item
enumerated therein are lacking. Furthermore, he attempts to highlight that Peter A. Eduria
Enterprises is a non-existing business establishment by submitting the negative certification of a
business name issued by the Department of Trade and Industry, 40 the certification of no record
issued by Business Permit and License Office of Valenzuela City, 41 and the certification of non-
registration of corporation/partnership by the Securities and Exchange Commission. 42
The failure to indicate the unit price of each item in the sales invoice does not defeat the
claim of the Caswells for reimbursement. In most cases in the ordinary course of business, sellers
issue handwritten receipts that are perfunctorily filled out without completely stating all the details
of the purchase. This 'flaw' should not be taken against the Caswells. Besides, if the unit price per
item is an issue, a perusal of Dana's separate list 43 will show the unit prices of the items in the
sales invoice. TSIDEa
With regard to the documentary evidence Owen adduced in his attempt to show the alleged
non-existence of Peter A. Eduria Enterprises, the negative certifications presented however only
highlight the probable liability of the store with the government for non-compliance with business
registration. Regardless of whether the latter had registered itself as a business entity with the
proper authorities, the documents Owen relies upon fail to overcome the point of the receipt: that
a sale of electrical items for installation had transpired between the Caswells and the seller. With
the relevant facts established that Zameco II rejected the quality of Owen's work and that
rectifications were made by installing the necessary materials to meet the electric distributor's
specifications, the said invoice cannot be considered as bereft of evidentiary value.
It must be noted en passant that Cerelina herself admitted that the contract price agreed
upon was the lump sum of P250,000.00, and that she only paid Owen P227,000.00, 44 while the
dispositive portion of the MTC Decision stated that Owen's claims are dismissed, the lower court
implies that the P23,000.00 unpaid compensation he sought to recover from the Caswells shall
not be given directly to him, offsetting the said amount from the rectification cost that the Caswells
had prayed for. In effect, under the circumstances, we deem this fair and just to measure the
actual damages due the Caswells by reducing the cost they shouldered to repair the defects with
the unpaid amount of the contract price due Owen. CIaHDc
WHEREFORE, the instant petition is DENIED. The April 30, 2008 Decision and July 24,
2008 Resolution of the Court of Appeals in CA-G.R. SP No. 97146, which reinstated the June 29,
2006 Decision of the Municipal Trial Court, San Narciso, Zambales, in Civil Case No. 538,
are AFFIRMED in toto. No costs.
SO ORDERED. (Mackay v. Spouses Caswell, G.R. No. 183872, [November 17, 2014],
747 PHIL 1-19)

28
 FIRST DIVISION
[G.R. No. 156330. November 19, 2014.]
NEDLLOYD LIJNEN B.V. ROTTERDAM and THE EAST ASIATIC CO., LTD., petitioners, vs.
GLOW LAKS ENTERPRISES, LTD., respondent.

DECISION
PEREZ, J p:
This is a Petition for Review on Certiorari 1 filed pursuant to Rule 45 of the Revised Rules
of Court, primarily assailing the 11 December 2002 Resolution rendered by the Special Former
Sixteenth Division of the Court of Appeals in CA-G.R. CV No. 48277, 2 the decretal portion of
which states:
WHEREFORE, the appeal is GRANTED and the April 29, 1994 Decision of the
Regional Trial Court of Manila, Branch 52 thereof in Civil Case No. 88-45595, SET
ASIDE. Nedlloyd Lijnen B.V. Rotterdam and The East Asiatic Co., Ltd. are ordered to
pay Glow Laks Enterprises, Ltd. the following:
1. The invoice value of the goods lost worth $53,640.00, or its equivalent in Philippine
currency;
2. Attorney's fees of P50,000.00; and
3. Costs. 3
The Facts
Petitioner Nedlloyd Lijnen B.V. Rotterdam (Nedlloyd) is a foreign corporation engaged in
the business of carrying goods by sea, whose vessels regularly call at the port of Manila. It is
doing business in the Philippines thru its local ship agent, co-petitioner East Asiatic Co., Ltd. (East
Asiatic).
Respondent Glow Laks Enterprises, Ltd., is likewise a foreign corporation organized and
existing under the laws of Hong Kong. It is not licensed to do, and it is not doing business in, the
Philippines.
On or about 14 September 1987, respondent loaded on board M/S Scandutch at the Port of
Manila a total 343 cartoons of garments, complete and in good order for pre-carriage to the Port of
Hong Kong. The goods covered by Bills of Lading Nos. MHONX-2 and MHONX-3 4 arrived in
good condition in Hong Kong and were transferred to M/S Amethyst for final carriage to Colon,
Free Zone, Panama. Both vessels, M/S Scandutch and M/S Amethyst, are owned by Nedlloyd
represented in the Philippines by its agent, East Asiatic. The goods which were valued at
US$53,640.00 was agreed to be released to the consignee, Pierre Kasem, International, S.A.,
upon presentation of the original copies of the covering bills of lading. 5 Upon arrival of the vessel
at the Port of Colon on 23 October 1987, petitioners purportedly notified the consignee of the
arrival of the shipments, and its custody was turned over to the National Ports Authority in
accordance with the laws, customs regulations and practice of trade in Panama. By an
unfortunate turn of events, however, unauthorized persons managed to forge the covering bills of
lading and on the basis of the falsified documents, the ports authority released the goods.
On 16 July 1988, respondent filed a formal claim with Nedlloyd for the recovery of the
amount of US$53,640.00 representing the invoice value of the shipment but
to no avail. 6 Claiming that petitioners are liable for the misdelivery of the goods, respondent
initiated Civil Case No. 88-45595 before the Regional Trial Court (RTC) of Manila, Branch 52,
seeking for the recovery of the amount of US$53,640.00, including the legal interest from the date
of the first demand. 7
In disclaiming liability for the misdelivery of the shipments, petitioners asserted in their
Answer 8 that they were never remiss in their obligation as a common carrier and the goods were
discharged in good order and condition into the custody of the National Ports Authority of Panama
in accordance with the Panamanian law. They averred that they cannot be faulted for the release
of the goods to unauthorized persons, their extraordinary responsibility as a common carrier
having ceased at the time the possession of the goods were turned over to the possession of the
port authorities.
After the Pre-Trial Conference, trial on the merits ensued. Both parties offered testimonial
and documentary evidence to support their respective causes. On 29 April 2004, the RTC
rendered a Decision 9 ordering the dismissal of the complaint but granted petitioners'
counterclaims. In effect, respondent was directed to pay petitioners the amount of P120,000.00 as
indemnification for the litigation expenses incurred by the latter. In releasing the common carrier
from liability for the misdelivery of the goods, the RTC ruled that Panama law was duly proven
29
during the trial and pursuant to the said statute, carriers of goods destined to any Panama port of
entry have to discharge their loads into the custody of Panama Ports Authority to make effective
government collection of port dues, customs duties and taxes. The subsequent withdrawal
effected by unauthorized persons on the strength of falsified bills of lading does not constitute
misdelivery arising from the fault of the common carrier. The decretal part of the RTC Decision
reads:
WHEREFORE, judgment is rendered for [petitioners] and against
[Respondent], ordering the dismissal of the complaint and ordering the latter to pay
[petitioners] the amount of ONE HUNDRED TWENTY THOUSAND PESOS
(P120,000.00) on their counterclaims.
Cost against [Respondent]. 10
On appeal, the Court of Appeals reversed the findings of the RTC and held that foreign
laws were not proven in the manner provided by Section 24, Rule 132 of the Revised Rules of
Court, and therefore, it cannot be given full faith and credit. 11 For failure to prove the foreign law
and custom, it is presumed that foreign laws are the same as our local or domestic or internal law
under the doctrine of processual presumption. Under the New Civil Code, the discharge of the
goods into the custody of the ports authority therefore does not relieve the common carrier from
liability because the extraordinary responsibility of the common carriers lasts until actual or
constructive delivery of the cargoes to the consignee or to the person who has the right to receive
them. Absent any proof that the notify party or the consignee was informed of the arrival of the
goods, the appellate court held that the extraordinary responsibility of common carriers remains.
Accordingly, the Court of Appeals directed petitioners to pay respondent the value of the
misdelivered goods in the amount of US$53,640.00.
The Issues
Dissatisfied with the foregoing disquisition, petitioners impugned the adverse Court of
Appeals Decision before the Court on the following grounds:
I.
THERE IS ABSOLUTELY NO NEED TO PROVE PANAMANIAN LAWS BECAUSE
THEY HAD BEEN JUDICIALLY ADMITTED. AN ADMISSION BY A PARTY IN THE
COURSE OF THE PROCEEDINGS DOES NOT REQUIRE PROOF.
II.
BY PRESENTING AS EVIDENCE THE [GACETA] OFFICIAL OF REPUBLICA DE
PANAMA NO. 17.596 WHERE THE APPLICABLE PANAMANIAN LAWS WERE
OFFICIALLY PUBLISHED, AND THE TESTIMONY OF EXPERT WITNESSES,
PETITIONERS WERE ABLE TO PROVE THE LAWS OF PANAMA.
III.
IF WE HAVE TO CONCEDE TO THE COURT OF APPEALS' FINDING THAT
THERE WAS FAILURE OF PROOF, THE LEGAL QUESTION PRESENTED TO
THE HONORABLE COURT SHOULD BE RESOLVED FAVORABLY BECAUSE
THE CARRIER DISCHARGED ITS DUTY WHETHER UNDER THE PANAMANIAN
LAW OR UNDER PHILIPPINE LAW. 12

The Court's Ruling

We find the petition bereft of merit.
It is well settled that foreign laws do not prove themselves in our jurisdiction and our courts
are not authorized to take judicial notice of them. Like any other fact, they must be alleged and
proved. 13 To prove a foreign law, the party invoking it must present a copy thereof and comply
with Sections 24 and 25 of Rule 132 of the Revised Rules of Court 14 which read:
SEC. 24. Proof of official record. — The record of public documents referred to
in paragraph (a) of Section 19, when admissible for any purpose, may be evidenced
by an official publication thereof or by a copy attested by the officer having the legal
custody of the record, or by his deputy, and accompanied, if the record is not kept in
the Philippines, with a certificate that such officer has the custody. If the office in
which the record is kept is in a foreign country, the certificate may be made by a
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 secretary of the embassy or legation, consul general, consul, vice-consul, or
consular agent or by any officer in the foreign service of the Philippines
stationed in the foreign country in which the record is kept, and authenticated
by the seal of his office.
SEC. 25. What attestation of copy must state. — Whenever a copy of a
document or record is attested for the purpose of the evidence, the attestation must
state, in substance, that the copy is a correct copy of the original, or a specific part
thereof, as the case may be. The attestation must be under the official seal of the
attesting officer, if there be any, or if he be the clerk of a court having a seal, under the
seal of such court.
For a copy of a foreign public document to be admissible, the following requisites are
mandatory: (1) it must be attested by the officer having legal custody of the records or by his
deputy; and (2) it must be accompanied by a certificate by a secretary of the embassy or legation,
consul general, consul, vice-consular or consular agent or foreign service officer, and with the seal
of his office. 15 Such official publication or copy must be accompanied, if the record is not kept in
the Philippines, with a certificate that the attesting officer has the legal custody thereof. 16 The
certificate may be issued by any of the authorized Philippine embassy or consular officials
stationed in the foreign country in which the record is kept, and authenticated by the seal of his
office. 17 The attestation must state, in substance, that the copy is a correct copy of the original,
or a specific part thereof, as the case may be, and must be under the official seal of the attesting
officer. 18
Contrary to the contention of the petitioners, the Panamanian laws, particularly Law 42 and
its Implementing Order No. 7, were not duly proven in accordance with Rules of Evidence and as
such, it cannot govern the rights and obligations of the parties in the case at bar. While a
photocopy of the Gaceta Official of the Republica de Panama No. 17.596, the Spanish text
of Law 42 which is the foreign statute relied upon by the court a quo to relieve the common
carrier from liability, was presented as evidence during the trial of the case below, the
same however was not accompanied by the required attestation and certification.
It is explicitly required by Section 24, Rule 132 of the Revised Rules of Court that a copy of
the statute must be accompanied by a certificate of the officer who has legal custody of the
records and a certificate made by the secretary of the embassy or legation, consul general,
consul, vice-consular or by any officer in the foreign service of the Philippines stationed in the
foreign country, and authenticated by the seal of his office. The latter requirement is not merely a
technicality but is intended to justify the giving of full faith and credit to the genuineness of the
document in a foreign country. 19 Certainly, the deposition of Mr. Enrique Cajigas, a maritime law
practitioner in the Republic of Panama, before the Philippine Consulate in Panama, is not the
certificate contemplated by law. At best, the deposition can be considered as an opinion of an
expert witness who possess the required special knowledge on the Panamanian laws but could
not be recognized as proof of a foreign law, the deponent not being the custodian of the statute
who can guarantee the genuineness of the document from a foreign country. To admit the
deposition as proof of a foreign law is, likewise, a disavowal of the rationale of Section
24, Rule 132 of the Revised Rules of Court, which is to ensure authenticity of a foreign law and its
existence so as to justify its import and legal consequence on the event or transaction in issue.
The above rule, however, admits exceptions, and the Court in certain cases recognized
that Section 25, Rule 132 of the Revised Rules of Court does not exclude the presentation of
other competent evidence to prove the existence of foreign law. In Willamette Iron and Steel
Works v. Muzzal 20 for instance, we allowed the foreign law to be established on the basis of the
testimony in open court during the trial in the Philippines of an attorney-at-law in San Francisco,
California, who quoted the particular foreign law sought to be established. 21 The ruling is peculiar
to the facts. Petitioners cannot invoke the Willamette ruling to secure affirmative relief since their
so called expert witness never appeared during the trial below and his deposition, that was
supposed to establish the existence of the foreign law, was obtained ex-parte.
It is worth reiterating at this point that under the rules of private international law, a foreign
law must be properly pleaded and proved as a fact. In the absence of pleading and proof, the laws
of the foreign country or state will be presumed to be the same as our local or domestic law. This
is known as processual presumption. 22 While the foreign law was properly pleaded in the case at
bar, it was, however, proven not in the manner provided by Section 24, Rule 132 of the Revised
Rules of Court. The decision of the RTC, which proceeds from a disregard of specific rules cannot
be recognized.
Having settled the issue on the applicable Rule, we now resolve the issue of whether or not
petitioners are liable for the misdelivery of goods under Philippine laws.

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 Under the New Civil Code, common carriers, from the nature of their business and for
reasons of public policy, are bound to observe extraordinary diligence in the vigilance over
goods, according to the circumstances of each case. 23 Common carriers are responsible for
loss, destruction or deterioration of the goods unless the same is due to flood, storm, earthquake
or other natural disaster or calamity. 24 Extraordinary diligence is that extreme care and
caution which persons of unusual prudence and circumspection use for securing or
preserving their own property or rights. 25 This expecting standard imposed on common
carriers in contract of carrier of goods is intended to tilt the scales in favor of the shipper who is at
the mercy of the common carrier once the goods have been lodged for the shipment. 26 Hence, in
case of loss of goods in transit, the common carrier is presumed under the law to have been in
fault or negligent. 27
While petitioners concede that, as a common carrier, they are bound to observe
extraordinary diligence in the care and custody of the goods in their possession, they insist that
they cannot be held liable for the loss of the shipments, their extraordinary responsibility having
ceased at the time the goods were discharged into the custody of the customs arrastre operator,
who in turn took complete responsibility over the care, storage and delivery of the cargoes. 28
In contrast, respondent, submits that the fact that the shipments were not delivered to the
consignee as stated in the bill of lading or to the party designated or named by the consignee,
constitutes misdelivery thereof, and under the law it is presumed that the common carrier is at
fault or negligent if the goods they transported, as in this case, fell into the hands of persons who
have no right to receive them.
We sustain the position of the respondent.
Article 1736 and Article 1738 are the provisions in the New Civil Code which define the
period when the common carrier is required to exercise diligence lasts, viz.:
Article 1736. The extraordinary responsibility of the common carrier lasts from
the time the goods are unconditionally placed in the possession of, and received by
the carrier for transportation until the same are delivered, actually or constructively, by
the carrier to the consignee, or to the person who has a right to receive them, without
prejudice to the provisions of article 1738.
Article 1738. The extraordinary liability of the common carrier continues to be
operative even during the time the goods are stored in a warehouse of the carrier at
the place of destination, until the consignee has been advised of the arrival of the
goods and has had reasonable opportunity thereafter to remove them or otherwise
dispose of them.
Explicit is the rule under Article 1736 of the Civil Code that the extraordinary responsibility
of the common carrier begins from the time the goods are delivered to the carrier. 29 This
responsibility remains in full force and effect even when they are temporarily unloaded or stored in
transit, unless the shipper or owner exercises the right of stoppage in transitu, and terminates only
after the lapse of a reasonable time for the acceptance, of the goods by the consignee or such
other person entitled to receive them. 30
It was further provided in the same statute that the carrier may be relieved from the
responsibility for loss or damage to the goods upon actual or constructive delivery of the same by
the carrier to the consignee or to the person who has the right to receive them. 31 In sales, actual
delivery has been defined as the ceding of the corporeal possession by the seller, and the actual
apprehension of the corporeal possession by the buyer or by some person authorized by him to
receive the goods as his representative for the purpose of custody or disposal. 32 By the same
token, there is actual delivery in contracts for the transport of goods when possession has
been turned over to the consignee or to his duly authorized agent and a reasonable time is
given him to remove the goods. 33
In this case, there is no dispute that the custody of the goods was never turned over to the
consignee or his agents but was lost into the hands of unauthorized persons who secured
possession thereof on the strength of falsified documents. The loss or the misdelivery of the
goods in the instant case gave rise to the presumption that the common carrier is at fault or
negligent.
A common carrier is presumed to have been negligent if it fails to prove that it exercised
extraordinary vigilance over the goods it transported. 34 When the goods shipped are either
lost or arrived in damaged condition, a presumption arises against the carrier of its failure
to observe that diligence, and there need not be an express finding of negligence to hold it
liable. 35 To overcome the presumption of negligence, the common carrier must establish
by adequate proof that it exercised extraordinary diligence over the goods. 36 It must do
more than merely show that some other party could be responsible for the damage. 37
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 In the present case, petitioners failed to prove that they did exercise the degree of diligence
required by law over the goods they transported. Indeed, aside from their persistent disavowal of
liability by conveniently posing an excuse that their extraordinary responsibility is terminated upon
release of the goods to the Panamanian Ports Authority, petitioners failed to adduce sufficient
evidence they exercised extraordinary care to prevent unauthorized withdrawal of the shipments.
Nothing in the New Civil Code, however, suggests, even remotely, that the common carriers'
responsibility over the goods ceased upon delivery thereof to the custom authorities. To the mind
of this Court, the contract of carriage remains in full force and effect even after the delivery of the
goods to the port authorities; the only delivery that releases it from their obligation to observe
extraordinary care is the delivery to the consignee or his agents. Even more telling of petitioners'
continuing liability for the goods transported to the fact that the original bills of lading up to this
time, remains in the possession of the notify party or consignee. Explicit on this point is the
provision of Article 353 of the Code of Commerce which provides:
Article 353. The legal evidence of the contract between the shipper and the
carrier shall be the bills of lading, by the contents of which the disputes which may
arise regarding their execution and performance shall be decided, no exceptions being
admissible other than those of falsity and material error in the drafting.
After the contract has been complied with, the bill of lading which the
carrier has issued shall be returned to him, and by virtue of the exchange of this
title with the thing transported, the respective obligations and actions shall be
considered cancelled, unless in the same act the claim which the parties may
wish to reserve be reduced to writing, with the exception of that provided for in
Article 366.
In case the consignee, upon receiving the goods, cannot return the bill of lading
subscribed by the carrier, because of its loss or of any other cause, he must give the
latter a receipt for the goods delivered, this receipt producing the same effects as the
return of the bill of lading.
While surrender of the original bill of lading is not a condition precedent for the common
carrier to be discharged from its contractual obligation, there must be, at the very least, an
acknowledgement of the delivery by signing the delivery receipt, if surrender of the original of the
bill of lading is not possible. 38 There was neither surrender of the original copies of the bills of
lading nor was there acknowledgment of the delivery in the present case. This leads to the
conclusion that the contract of carriage still subsists and petitioners could be held liable for the
breach thereof.
Petitioners could have offered evidence before the trial court to show that they exercised
the highest degree of care and caution even after the goods was turned over to the custom
authorities, by promptly notifying the consignee of its arrival at the Port of Cristobal in order to
afford them ample opportunity to remove the cargoes from the port of discharge. We have
scoured the records and found that neither the consignee nor the notify party was informed by the
petitioners of the arrival of the goods, a crucial fact indicative of petitioners' failure to observe
extraordinary diligence in handling the goods entrusted to their custody for transport. They could
have presented proof to show that they exercised extraordinary care but they chose in vain, full
reliance to their cause on applicability of Panamanian law to local jurisdiction.
It is for this reason that we find petitioners liable for the misdelivery of the goods. It is
evident from the review of the records and by the evidence adduced by the respondent that
petitioners failed to rebut the prima facie presumption of negligence. We find no compelling
reason to depart from the ruling of the Court of Appeals that under the contract of carriage,
petitioners are liable for the value of the misdelivered goods.
WHEREFORE, premises considered, the petition is hereby DENIED. The assailed
Resolution of the Court of Appeals is hereby AFFIRMED.
SO ORDERED. (Nedlloyd Lijnen B.V. Rotterdam v. Glow Laks Enterprises, Ltd., G.R. No.
156330, [November 19, 2014], 747 PHIL 170-187)

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