THIRD DIVISION

[G. R. No. 128574. September 18, 2002]

UNIVERSAL ROBINA SUGAR MILLING CORPORATION, petitioner, vs.

HEIRS OF ANGEL TEVES, respondents.
DECISION
SANDOVAL-GUTIERREZ, J.:

Andres Abanto owned two parcels of land situated in Campuyo, Manjuyod, Negros
Oriental. One lot, consisting of 55,463 square meters, is registered in his name under
Transfer Certificate of Title (TCT) No. H-37 of the Registry of Deeds of said
province. The other lot with an area of 193,789 square meters is unregistered. He
died on February 16, 1973.
[1]

On October 19, 1974, Andres Abanto's heirs executed an Extrajudicial Settlement

of the Estate of the Deceased Andres Abanto and Simultaneous Sale. In this
document, Abanto's heirs adjudicated unto themselves the two lots and sold the
(a) unregistered lot of 193,789 square meters to the United Planters Sugar Milling
Company, Inc. (UPSUMCO), and (b) theregistered lot covered by TCT No. H-37 to
Angel M. Teves, for a total sum of P115,000.00. The sale was not registered.
[2]

[3]

Out of respect for his uncle Ignacio Montenegro, who was UPSUMCO's founder
and president, Teves verbally allowed UPSUMCO to use the lot covered by TCT No. H37 for pier and loading facilities, free of charge, subject to the condition that UPSUMCO
shall shoulder the payment of real property taxes and that its occupation shall be coterminus with its corporate existence. UPSUMCO then built a guesthouse and pier
facilities on the property.
[4]

[5]

Years later, UPSUMCOs properties were acquired by the Philippine National Bank
(PNB). Later, PNB transferred the same properties to the Asset Privatization Trust
(APT) which, in turn, sold the same to the Universal Robina Sugar Milling Corporation
(URSUMCO).
URSUMCO
then
took
possession
of
UPSUMCOs
properties, including Teves' lot covered by TCT No. H-37.
Upon learning of URSUMCO's acquisition of his lot, Teves formally asked the
corporation to turn over to him possession thereof or the corresponding rentals. He
stated in his demand letters that he merely allowed UPSUMCO to use his property until
its corporate dissolution; and that it was not mortgaged by UPSUMCO with the PNB
and, therefore, not included among the foreclosed properties acquired by URSUMCO.
[6]

URSUMCO refused to heed Teves' demand, claiming that it acquired the right to
occupy the property from UPSUMCO which purchased it from Andres Abanto; and that
it was merely placed in the name of Angel Teves, as shown by the Deed of Transfer
and Waiver of Rights and Possession dated November 26, 1987. Under this
document, UPSUMCO transferred to URSUMCO its application for agricultural and
foreshore lease. The same document partly states that the lands subject of the
foreshore and agricultural lease applications are bounded on the north by the "titled
property of Andres Abanto bought by the transferor (UPSUMCO) but placed in the name
of Angel Teves". URSUMCO further claimed that it was UPSUMCO, not Teves, which
has been paying the corresponding realty taxes.
[7]

Consequently, on June 18, 1992, Teves filed with the Regional Trial Court (RTC),
Dumaguete City, Branch 43, a complaint for recovery of possession of real property with
damages against URSUMCO, docketed as Civil Case No. 10235.
On September 4, 1992, Teves died and was substituted by his heirs.
[8]

[9]

On April 6, 1994, the RTC rendered its Decision finding that URSUMCO has no
personality to question the validity of the sale of the property between the heirs of
Andres Abanto and Angel Teves since it is not a party thereto; that Teves' failure to have
the sale registered with the Registry of Deeds would not vitiate his right of ownership,
unless a third party has acquired the land in good faith and for value and has registered
the subsequent deed; that the list of properties acquired by URSUMCO from the PNB
does not include the disputed lot and, therefore, was not among those conveyed by
UPSUMCO to URSUMCO. The dispositive portion of the Decision reads:
[10]

"Wherefore, in view of the foregoing, judgment is hereby rendered:

1. Declaring plaintiff (Teves) the owner of the parcel of land covered by
Transfer Certificate of Title No. H-37 situated at Campuyo, Manjuyod,
Negros Oriental and as such, is entitled to the possession of said land
subject to the provision of Article 448 of the New Civil Code. Accordingly,
except where the immediate premises of the guest house and pier are
concerned, defendant (URSUMCO) is directed to vacate the remaining
portion of said property;
2. Declaring defendant as the owner of the guest house and pier and as a
builder in good faith of said guest house and pier;
3. Declaring plaintiff as entitled to the option under Article 448 of the New
Civil Code, namely:

(a) To appropriate the guest house and pier as his own upon payment of
indemnity under Articles 546 and 548 of the New Civil Code, or
(b) To oblige defendant to buy the land in question unless its value is
considerably more than the improvements (guest house and pier), in
which case defendant shall pay reasonable rent.
4. Declaring defendant as entitled to retain possession of the guest house and
pier until defendant is indemnified of the useful and necessary expenses for
the preservation of said improvements provided in Article 546 of the New
Civil Code and such other expenses for luxury as may be allowed under
Article 548 of the same Code in case plaintiff takes the option of
appropriating for himself the improvements;
5. Ordering defendant to pay plaintiff reasonable attorneys fees in the amount
of P15,000.00;
6. Dismissing all other claims for damages by plaintiff and the counterclaim
for lack of merit; and
7. Ordering defendant to pay the costs of this suit.
SO ORDERED."
On appeal by URSUMCO, the Court of Appeals affirmed the RTC decision,
holding that the transaction between Angel Teves and Andres Abanto's heirs is a
contract of sale, not one to sell, because ownership was immediately conveyed to the
purchaser upon payment of P115,000.00. The Court of Appeals further held that Teves'
failure to cause the registration of the sale is not fatal since a contract of sale is
perfected by mere consent of the contracting parties and has the force of law between
them. Besides, his failure to refer the case to the barangaycannot affect the jurisdiction
already acquired by the court over the subject matter and the person of "defendantappellant" URSUMCO.
[11]

On October 29, 1996, URSUMCO filed a motion for reconsideration but was denied
by the Appellate Court in a Resolution dated February 10, 1997.
[12]

Hence, the instant petition for review on certiorari raising the following legal
issues:
[13]

1. Whether the respondents have established a cause of action against petitioner;

2. Whether petitioner herein has the legal capacity to question the validity of the sale;
and
3. Whether the complaint should have been dismissed for lack of barangay conciliation.

The petition is bereft of merit.

Petitioner URSUMCO contends that respondents have no cause of action because
the Extrajudicial Settlement of the Estate of the Deceased Andres Abanto and
Simultaneous Sale is merely a promise to sell and not an absolute deed of sale, hence,
did not transfer ownership of the disputed lot to Angel Teves. Assuming that the
document is a contract of sale, the same is void for lack of consideration because the
total price of P115,000.00 does not specifically refer to the lot covered by TCT No. H-37,
making the price uncertain. Furthermore, the transaction, being unregistered, does not
bind third parties.
Petitioner's contentions lack merit. As held by the RTC and the Court of Appeals,
the transaction is not merely a contract to sell but a contract of sale. In a contract of
sale, title to the property passes to the vendee upon delivery of the thing sold; while in a
contract to sell, ownership is, by agreement, reserved in the vendor and is not to pass to
the vendee until full payment of the purchase price. In the case at bar, the subject
contract, duly notarized, provides:
[14]

[15]

"EXTRA-JUDICIAL SETTLEMENT OF THE ESTATE OF THE DECEASED

ANDRES ABANTO AND SIMULTANEOUS SALE
KNOW ALL MEN BY THESE PRESENTS:
That VICTORINA C. VDA. DE ABANTO, widow, and GUMERSINDA A.
ABANTO-MALDO, married to Porferio Maldo, both of legal age, Filipinos, and
residents of Olimpia, Bais City, hereby freely and spontaneously
DECLARE AND MAKE MANIFEST THAT:
1. That they are the only legitimate heirs of the deceased Andres Abanto, being the
surviving spouse and the legally adopted daughter of the deceased Andres Abanto;
2. That the aforementioned deceased died on February 16, 1973 in the City of Bais,
which was his residence at the time of his death;

3. That said decedent died without leaving any will and without debts and his only
surviving heirs are the aforementioned Victorina C. Vda. de Abanto and Gumersinda
A. Maldo;
4. That the deceased left as his estate and only real properties, certain parcels of land
which are more particularly described and founded as follows:
PARCEL ONE TCT NO. H-37
"A parcel of agricultural land, with the improvements thereon, containing an area of
FIFTY-FIVE THOUSAND FOUR HUNDRED SIXTY THREE (55,463) SQUARE
METERS MORE OR LESS, situated in barrio Campuyo, Manjuyod, Negros Oriental
and bounded on the Northeast by Taon Strait; on the South by the property claimed
by Nazario Acabal; on the west by North Bais Bay, public land and the properties
claimed by Fortunato Acabal and Manuel Gonzales as described in TCT No. H-37."
PARCEL TWO
"A parcel of unregistered land, together with the improvements, accessions and other
interests over the said lot, situated at barrio Campuyo, Municipality of Manjuyod,
Province of Negros Oriental, containing an area of ONE HUNDRED NINETY
THREE THOUSAND, SEVEN HUNDRED EIGHTY NINE (193,789) square meters
more or less, as described on plan Psu. 123473 and as amended by PSU 07-01-000
and as declared under Tax Declaration No. 00589 and assessed in said tax declaration
for taxation purposes at P24,860.00"
5. That the parties herein have agreed as they hereby agree to adjudicate said parcels
of land unto themselves in accordance with Sec. 1, Rule 74 of the Rules of Court and
to sell, transfer and convey for a total sum of ONE HUNDRED FIFTEEN
THOUSAND PESOS (P115,000.00) Philippine currency the above described
properties in the following manner to wit:
1. TO THE UNITED PLANTERS' SUGAR MILLING CO., INC., a domestic
corporation duly organized and existing under the laws of the Philippines, with
residence and office address at Alangilanan, Manjuyod, Negros Oriental - That parcel
which is described as parcel two above;
2. TO ANGEL M. TEVES, of legal age, Filipino, married to Elena Teves, a resident of
and with postal address at Bais City - That parcel described as parcel one above.

In witness whereof, we have hereunto affixed our signatures this 19 th day of October
1974 at the City of Bais, Philippines.
(Sgd.)
VICTORINA C. VDA. DE ABANTO
Heir Vendor
(Sgd.)
GUMERSINDA ABANTO-MALDO
Heir Vendor
UNITED PLANTERS' SUGAR MILLING CO., INC.
Vendee
by:
(Sgd.)
IGNACIO VICENTE
President
(Sgd.)
ANGEL M. TEVES
Vendee
_______(Sgd.)______ witnesses ______(Sgd.)_______"
It is clear from the recitals of the above contract that it is an extrajudicial settlement
of the estate of the deceased Andres Abanto, and simultaneous sale of the properties
described therein, including the subject lot. Clearly indicated therein is that the Abanto
heirs sold to Teves the lot covered by TCT No. H-37. There is no showing that the
Abanto heirs merely promised to sell the said lot to Teves.

That absolute ownership over the land (TCT No. H-37) was indeed transferred to
Teves is further shown by his acts subsequent to the execution of the contract. As
found by the trial court, it was Teves, not Andres Abanto's heirs, who allowed
UPSUMCO to construct pier facilities and guesthouse on the land. When the property
was erroneously included among UPSUMCO's properties that were transferred to
petitioner URSUMCO, it was Teves, not the heirs of Andres Abanto, who informed
petitioner that he owns the same and negotiated for an arrangement regarding its
use. Teves even furnished petitioner documents and letters showing his ownership of
the lot, such as a copy of the "Extrajudicial Settlement of the Estate of the Deceased
Andres Abanto and Simultaneous Sale" and a certified true copy of TCT No. H-37
covering the disputed lot. Indeed, the trial court and the Court of Appeals correctly
ruled that Teves purchased the lot from the Abanto heirs, thus:
[16]

[17]

[18]

"1. That Angel Teves was the purchaser of the land in question covered by Transfer
Certificate of Title No. H-37 in an Extrajudicial Settlement of Estate of Andres Abanto
and Simultaneous Sale, dated October 19, 1974 (Exhibit "A"), more particularly
described as follows:
"A parcel of agricultural land, with the improvements thereon, containing an area of
FIFTY-FIVE THOUSAND FOUR HUNDRED SIXTY THREE (55,463) SQUARE
METERS MORE OR LESS, situated in barrio Campuyo, Manjuyod, Negros Oriental
and bounded on the Northeast by Taon Strait; on the South by the property claimed
by Nazario Acabal; on the west by North Bais Bay, Public land and the properties
claimed by Fortunato Acabal and Manuel Gonzales as described in TCT No. H-37."
[19]

If we follow petitioner's posture that the transaction was only a contract to sell,
ownership of the lot would have remained with the Abanto heirs, not with
UPSUMCO. Consequently, UPSUMCO would not have transferred any right over the
property to petitioner URSUMCO.
We are likewise unconvinced by petitioner's assertion that the price or consideration
of the contract is not certain. In a contract of sale, one of the contracting parties
obligates himself to transfer the ownership of and to deliver a determinate thing, and the
other to pay therefor a price certain in money or its equivalent. The subject of the sale
embodied in the Extrajudicial Settlement of Estate of the Deceased Andres Abanto and
Simultaneous Sale consists of two parcels of land. It is clear from the said instrument
that the amount of P115,000.00 refers to the price for the two lots as a whole. Thus,
contrary to petitioner's claim, the price of the subject property is not uncertain.
[20]

That the contract of sale was not registered does not affect its validity. Being
consensual in nature, it is binding between the parties, the Abanto heirs and
Teves. Article 1358 of the New Civil Code, which requires the embodiment of certain

contracts in a public instrument, is only for convenience, and the registration of the
instrument would merely affect third persons. Formalities intended for greater efficacy
or convenience or to bind third persons, if not done, would not adversely affect the
validity or enforceability of the contract between the contracting parties themselves.
Thus, by virtue of the valid sale, Angel Teves stepped into the shoes of the heirs of
Andres Abanto and acquired all their rights to the property.
[21]

[22]

Anent the second issue, petitioner contends that being an innocent purchaser for
value of the lot and its current possessor, it has the personality to assail the validity of
the sale in question.
An innocent purchaser is one who acquired the property for a valuable
consideration, not knowing that the title of the vendor or grantor is null and void. He is
also one who buys the property of another without notice that some other person has a
right to, or interest in, such property and pays a full and fair price for the same, at the
time of such purchase, or before he has notice of the claim or interest of some other
persons in the property. The concept underscores two important factors: (1) the
property which is bought for consideration, and (2) the lack of knowledge or notice of
adverse claim or interest prior to the sale. Both factors are not present insofar as
petitioner URSUMCO is concerned.
[23]

[24]

For one, petitioner acquired almost all of UPSUMCOS properties for a

consideration but failed to prove that the lot covered by TCT No. H - 37 was included
therein. In fact, the lot was not among the properties acquired by petitioner from the
APT whose holdings were limited only to those UPSUMCO properties foreclosed by the
PNB. Also, the Deed of Transfer and Waiver of Rights and Possession shows that
only the following properties and rights of UPSUMCO were transferred to petitioner
URSUMCO:
[25]

1. The guest house and pier at Campuyo site in the Municipality of Manjuyod,
Negros Oriental;
2. A parcel of land consisting of twenty five (25) hectares, more or less, leading to the
Campuyo pier which is the subject matter of UPSUMCO's agricultural lease
application pending with the Bureau of Lands and Land District Officer, Dumaguete
City; and
3. Pending application for an industrial or foreshore lease of that portion of the
adjacent government land approximately 270,000 square meters, later amended to be
16,000 square meters.

The foregoing list does not specifically include the subject lot. Admittedly, the same
Deed of Transfer and Waiver of Rights and Possession states that a titled property of
Andres Abanto bought by the transferor (UPSUMCO) but placed in the name of Angel
Teves is on the northern boundary of the above-mentioned lands subject of the
foreshore and agricultural lease applications. However, such description is insufficient
to establish that the titled property is indeed owned by UPSUMCO.
[26]

Petitioner cannot likewise assert that it has no adequate notice of any adverse claim
over the lot in controversy. Teves informed petitioner of his ownership and demanded
that he be placed in possession thereof or, in the alternative, that he be paid the
corresponding rentals. Moreover, petitioner should have been sufficiently forewarned of
a probable anomaly or irregularity in the ownership of the subject lot, considering that it
was registered not in the name of UPSUMCO, but in the name of Andres Abanto. A
purchaser cannot close his eyes to facts which should put a reasonable man upon his
guard, and then claim that he acted in good faith under the belief that there was no
defect in the title of the vendor.
[27]

The petition having been stripped of these anchors, both the RTC and the Court of
Appeals correctly ruled that petitioner has no sufficient cause of action against Angel
Teves, represented by herein respondents. Not being a party to the contract of sale
between Andres Abanto's heirs and Angel Teves, and not being a subsequent innocent
purchaser for value, petitioner cannot claim any right of possession over the land in
question. Surely, petitioner is proscribed from questioning Teves' ownership.
Regarding the third issue, suffice it to state that being a corporation, petitioner
cannot be impleaded as a party to a barangay conciliation proceeding. Section 1, Rule
VI
of
theKatarungang
Pambarangay Rules
implementing
the Katarungang
Pambarangay Law provides:
[28]

"Section 1. Parties. - Only individuals shall be parties to these proceedings either as

complainants or respondents. No complaint by or against corporations,
partnerships or other juridical entities shall be filed, received or acted upon."
(emphasis ours)
Incidentally, respondents, in their memorandum, pray that petitioner URSUMCO be
declared a recalcitrant possessor in bad faith and be held liable for damages in the
following amounts: (1) P1,060,000.00 as actual damages; (2) P100,000.00 as moral
damages; and (3) P50,000.00 as exemplary damages.
We quote with approval the disquisition of the RTC, affirmed by the Court of
Appeals, dismissing respondents' claim for damages, thus:

"As to the damages claimed by plaintiff (Teves), the Court holds that he is not entitled
to any of the damages claimed considering that Article 448 of the Civil Code does not
provide such remedy. Furthermore, there is no evidence showing that defendant had
made use of the land except with respect to the pier and guesthouse which defendant
had validly acquired from the United Planters Sugar Milling Company (Exhibit
"3"). However, based on equitable considerations, considering that plaintiff was
compelled to litigate in view of the refusal of defendant despite demand by the
plaintiff (Exhibits "C", "D", "F", "G", "H") to pay rental for the use of the property in
question, defendant should pay plaintiff reasonable attorney's fees in the amount of
P15,000.00."
[29]

WHEREFORE, the petition is DENIED. The assailed Decision of the Court of

Appeals dated September 30, 1996 in CA-G.R. CV No. 46352 is AFFIRMED.
SO ORDERED.
Puno, (Chairman), Panganiban, Corona, and Carpio-Morales, JJ., concur.

SECOND DIVISION
[A.M. No. MTJ-00-1265. April 6, 2000]

VALENCIDES VERCIDE, complainant, vs. JUDGE PRISCILLA T.

HERNANDEZ, Fifth Municipal Circuit Trial Court, Clarin and Tudela,
Misamis Occidental, respondent
. francis

DECISION
MENDOZA, J.:
This is a complaint filed against Judge Priscilla T. Hernandez of the Fifth Municipal
Circuit Trial Court, Clarin and Tudela, Misamis Occidental, charging her with grave
abuse of authority and ignorance of the law for her dismissal of a case which
complainant Valencides Vercide and his wife had filed against Daria Lagas Galleros for
recovery of possession of a piece of land. The land is located in Upper Centro, Tudela,
Misamis Occidental. Defendant Galleros is a resident of the same municipality, while
complainant and his wife are residents of Dipolog City. Because of this fact, the case
was filed in court without prior referral to the Lupong Tagapamayapa.
However, this matter was raised by defendant in her answer as an affirmative defense,
and respondent, in her order of July 15, 1997, ordered the dismissal of the case without
prejudice to the prosecution of the counterclaim pleaded by the defendant in her
answer. In support of her order, respondent cited P.D. No. 1508, 3 of which provides:
Venue. - Disputes between or among persons actually residing in the
same barangay shall be brought for amicable settlement before the Lupon
of said barangay. Those involving actual residents of different barangays
within the same city or municipality shall be brought in the barangay where
the respondent or any of the respondents actually resides, at the election
of the complainant. However, all disputes which involve real property or
any interest therein shall be brought in the barangay where the real
property or any part thereof is situated. (Emphasis added)

Complainant and his wife moved for a reconsideration, citing the following provisions of
R.A. 7160, "The Local Government Code of 1991":
SEC. 408. Subject matter for Amicable Settlement; Exception Thereto.
The lupon of each barangay shall have authority to bring together the
parties actually residing in the same city or municipality for amicable
settlement of all disputes except:
(a) Where one party is the government of any subdivision or
instrumentality thereof;
(b) Where one party is a public officer or employee, and the dispute
relates to the performance of his official functions;
(c) Offenses punishable by imprisonment exceeding one (1) year or a fine
exceeding Five Thousand pesos (P5,000.00);
(d) Offenses where there is no private offended party;
(e) Where the dispute involves real property located in different cities or
municipalities unless the parties thereto agree to submit their differences
to amicable settlement by an appropriate lupon;
(f) Disputes involving parties who actually reside in barangays of different
cities or municipalities, except where such barangay units adjoin each
other and the parties thereto agree to submit their differences to amicable
settlement by an appropriate lupon;
(g) Such other classes of disputes which the President may determine in
the interest of justice or upon recommendation of the Secretary of
Justice. marie
The court in which the non-criminal cases not falling within the authority of
the lupon under this Code are filed may, at any time before trial, motu
proprio refer the case to the lupon concerned for amicable settlement.
SEC. 409. Venue. - (a) Disputes between persons actually residing in the
same barangay shall be brought for amicable settlement before the lupon
of said barangay.
(b) Those involving actual residents of different barangays within the same
city of municipality shall be brought in the barangay where the respondent
or any of the respondents actually resides, at the election of the
complainant.

(c) All disputes involving real property or any interest therein shall be
brought in the barangay where the real property or the larger portion
thereof is situated.
(d) Those arising at the workplace where the contending parties are
employed or at the institution where such parties are enrolled for study
shall be brought in the barangay where such workplace or institution is
located.
Objections to venue shall be raised in the mediation proceedings before
the punong barangay; otherwise, the same shall be deemed waived. Any
legal question which may confront the punong barangay in resolving
objections to venue herein referred to may be submitted to the Secretary
of Justice or his duly designated representative whose ruling thereon shall
be binding.
They argued that under 408(f), in relation to 409(c), where the parties to a dispute
involving real property or any interest therein are not actual residents of the same city or
municipality or of adjoining barangays, prior resort to barangay conciliation is not
required.
However, respondent denied the motion. In her order dated September 9, 1997,
respondent stated:
The Court after taking into consideration the Motion for Reconsideration
and the ground relied upon by the counsel finds that counsel for the
plaintiffs failed to correlate Sections 408 and 409 of Republic Act No. 7160
and to consider Rule VIII, paragraph (a) of the Katarungang Pambarangay
Rules, the rules and regulations [of] which were promulgated to implement
Sections 399 to 422, Chapter 7, Title One Book III and Section 515, Book
IV of R.A. No. 7160, otherwise known as the Katarungang Pambarangay
Law, to wit:
"RULE VIII - PRE-CONDITION FOR FORMAL
ADJUDICATION
Conciliation, pre-condition for filing of complaint in court or
government office. novero
(a) No individual may go directly to court or to any
government office for adjudication of his dispute with another
individual upon any matter falling within the authority of the
Punong Barangay or Pangkat ng Tagapagkasundo to settle
under these Rules, unless, after personal confrontation of

the parties before them earnest efforts to conciliate have

failed to result in a settlement or such settlement has been
effectively repudiated."
and also Rule VI, Section 3 paragraph (c) of the same Katarungang
Pambarangay Rules which provides:
"Rule VI - Amicable Settlement of Disputes
Section 3. Venue. The place of settlement shall be subject to
the following rules:
....
(c) Dispute involving real property shall be brought for
settlement in the Barangay where the real property or larger
portion thereof is situated.
From the provisions of the above-cited Rules it was very clear that parties
whose disputes involved real property should first br[ing] the said dispute
before the barangay where the property was located, and that [because
of] failure to bring the dispute before the Barangay for conciliation no
action may be filed in court for final adjudication of the said dispute.
That parties should first comply with the provisions of the Katarungang
Pambarangay Law before the Court can acquire jurisdiction over the
complaint. That non-compliance of the plaintiff to the requirement of the
Katarungang Pambarangay Law was admitted by her in paragraph 3 of
the complaint. Her allegation of non-compliance with the mandatory
requirement of Lupon Conciliation before the filing of the complaint, in a
way divest[s] the Court of its jurisdiction over the case. In the 1997 Rules
of Civil Procedure, Rule 16, Section 1, paragraph (j) provides:
"That a condition precedent for filing the claim has not been
complied with"
WHEREFORE, in view of the foregoing, the Motion for Reconsideration is hereby
denied.
Complainant alleges that in dismissing Civil Case No. 295, respondent judge committed
"(a) Grave abuse of authority by knowingly rendering an unjust and unlawful order; (b)
Ignorance of the law in its highest order, she being a judge; (c) Grave disobedience to
the jurisprudence laid down by the Supreme Court of the Philippines on the matter of
exemption of lupon conciliation of contending parties who are not residen[ts] of the

same city or municipality." He states that respondent "practically threw several decisions
of the Supreme Court on the matter out of the window and obviously followed hook, line
and sinker the arguments of the [defendant] Daria Galleros."
In answer, respondent judge claims that she merely followed the law in dismissing the
case. She prays that the complaint against her be dismissed and that complainant be
ordered to stop harassing her just because he had not been able to obtain the relief he
wanted in Civil Case No. 295. nigel
In its memorandum dated February 29, 2000, the Office of the Court Administrator
recommends the dismissal of this case on the ground that the "issue [raised] is purely
judicial and is best resolved by a court of competent jurisdiction" and that, even if
respondent had erred, she should not be held administratively liable since there is no
allegation that she acted in bad faith or knowingly rendered an unjust judgment.
In Tavora v. Veloso, this Court already ruled that where parties do not reside in the
same city or municipality or in adjoining barangays, there is no requirement for them to
submit their dispute involving real property to the Lupong Tagapamayapa. As explained
in that case:
[1]

The sole issue raised is one of law: Under the given facts, is the respondent judge
barred from taking cognizance of the ejectment case pursuant to Sec. 6 of PD 1508
establishing a system of amicably settling disputes at the barangay level? The section
reads:
"SECTION. 6. Conciliation, precondition to filing of complaint. - No
complaint, petition, action or proceeding involving any matter within the
authority of the Lupon as provided in Section 2 hereof shall be filed or
instituted in court or any other government office for adjudication unless
there has been a confrontation of the parties before the Lupon Chairman
or the Pangkat and no conciliation or settlement has been reached as
certified by the Lupon Secretary or the Pangkat Secretary, attested by the
Lupon or Pangkat Chairman, or unless the settlement has been
repudiated. . . ." (Italics supplied)
For the above provision to be operative, the controversy must be within
the jurisdiction of the Lupong Tagapayapa (Lupon or Barangay court). On
this point, the relevant provisions of PD 1508 are:
"SECTION 2. Subject matters for amicable settlement. - The Lupon of
each barangay shall have authority to bring together the parties actually
residing in the same city or municipality for amicable settlement of all
disputes except:

(1) Where one party is the government, or any subdivision or

instrumentality thereof;
(2) Where one party is a public officer or employee, and the dispute
relates to the performance of his official functions;
(3) Offenses punishable by imprisonment exceeding 30 days, or a fine
exceeding P200.00;
(4) Offenses were there is no private offended party;
(5) Such other classes of disputes which the Prime Minister may in the
interest of justice determine, upon recommendation of the Minister of
Justice and the Minister of Local Government. ella
"SECTION 3. Venue. Disputes between or among persons actually
residing in the same barangay shall be brought for amicable settlement
before the Lupon of said barangay. Those involving actual residents of
different barangays within the same city or municipality shall be brought in
the barangay where the respondent or any of the respondents actually
resides, at the election of the complainant. However, all disputes which
involve real property or any interest therein shall be brought in the
barangay where the real property or any part thereof is situated.
"The Lupon shall have no authority over disputes:
(1) involving parties who actually reside in barangays of different cities or
municipalities, except where such barangays adjoin each other; and
(2) involving real property located in different municipalities." (Italics
supplied)
The foregoing provisions are quite clear. Section 2 specifies the conditions
under which the Lupon of a barangay "shall have authority" to bring
together the disputants for amicable settlement of their dispute: The
parties must be "actually residing in the same city or municipality." At the
same time, Section 3 while reiterating that the disputants must be
"actually residing in the same barangay" or in "different barangays
within the same city or municipality" unequivocably declares that the
Lupon shall have "no authority" over disputes "involving parties who
actually reside in barangays of different cities or municipalities," except
where such barangays adjoin each other.

Thus, by express statutory inclusion and exclusion, the Lupon shall have
no jurisdiction over disputes where the parties are not actual residents of
the same city or municipality, except where the barangays in which they
actually reside adjoin each other.
It is true that immediately after specifying the barangay whose Lupon shall
take cognizance of a given dispute, Sec. 3 of PD 1508 adds:
"However, all disputes which involve real property or any interest therein
shall be brought in the barangay where the real property or any part
thereof is situated."
Actually, however, this added sentence is just an ordinary proviso and
should operate as such. marinella
The operation of a proviso, as a rule, should be limited to its normal
function, which is to restrict or vary the operation of the principal clause,
rather than expand its scope, in the absence of a clear indication to the
contrary.
[2]

To be sure, the Court was interpreting in that case the provisions of P.D.
No. 1508 which, except for some modifications, are applicable to the case
before respondent judge because they are now found in 408-409 of
R.A. No. 7160 which took effect on January 1, 1992. The ruling in Tavora
v. Veloso, reiterated in other cases, should be familiar to the bench and
the bar. As we have held in Espiritu v. Jovellanos, the phrase "Ignorance
of the law excuses no one" has a special application to judges who, under
the injunction of Canon 1.01 of the Code of Judicial Conduct, "should be
the embodiment of competence, integrity, and independence." In Bacar v.
De Guzman, it was held that when the law violated is basic, the failure to
observe it constitutes gross ignorance. Reiterating this ruling, it was
emphasized in Almeron v. Sardido that the disregard of an established
rule of law amounts to gross ignorance of the law and makes the judge
subject to disciplinary action.
[3]

[4]

[5]

[6]

In the case at bar, respondent showed patent ignorance if not disregard of this
Courts rulings on the jurisdiction of the Lupong Tagapamayapa by her erroneous
quotations of the provisions of the Katarungang Pambarangay Rules implementing R.A.
No. 7160. While a judge may not be held administratively accountable for every
erroneous order or decision he renders, his error may be so gross or patent that he
should be administratively disciplined for gross ignorance of the law and incompetence.

In this case, respondent at first cited P.D. No. 1508, 3 as basis of her action. When her
attention was called to the fact that this had been repealed by 409(c) of R.A. No. 7160,
respondent, who obviously was more intent in justifying her previous order than
correcting her error, quoted out of context the provisions of the Katarungang
Pambarangay Rules implementing the Katarungang Pambarangay provisions of R.A.
No. 7160. She thus violated Canon 3 of the Code of Judicial Conduct which provides
that "In every case, a judge shall endeavor diligently to ascertain the facts and the
applicable law unswayed by partisan interest, public opinion or fear of criticism."
Contrary to respondents interpretation, it is clear even from the Katarungang
Pambarangay Rules that recourse to barangay conciliation proceedings is not
necessary where the parties do not reside in the same municipality or city or in adjoining
barangays. Rule VI of the same states in pertinent part:
SECTION 2. Subject matters for settlement. - All disputes may be the
subject of proceedings for amicable settlement under these rules except
the following enumerated cases:
(a) Where one party is the government, or any subdivision or
instrumentality thereof; alonzo
(b) Where one party is a public officer or employee, and the dispute
relates to the performance of his official functions;
(c) Offenses for which the law prescribes a maximum penalty of
imprisonment exceeding one (1) year or a fine exceeding Five Thousand
pesos (P5,000.00);
(d) Offenses where there is no private offended party;
(e) Where the dispute involves real properties located in different cities or
municipalities unless the parties thereto agree to submit their differences
to amicable settlement by an appropriate lupon;
(f) Disputes involving parties who actually reside in barangays of different
cities or municipalities, except where such barangay units adjoin each
other and the parties thereto to agree to submit their differences to
amicable settlement by an appropriate lupon;
(g) Such other classes of disputes which the President may determine in
the interest of justice or upon the recommendation of the Secretary of
Justice.

The foregoing exceptions notwithstanding, the court in which non-criminal

cases not falling within the authority of the lupon under these Katarungang
Pambarangay Law and Rules are filed may, at any time before trial, motu
proprio refer the case to the lupon concerned for amicable settlement.
SECTION 3. Venue. The place of settlement shall be subject to the
following rules:
(a) Where the parties reside in the same barangay, the dispute shall be
brought for settlement in said barangay;
(b) Where the parties reside in different barangays in the same city or
municipality, the dispute shall be settled in the barangay where the
respondent or any one of the respondents actually resides, at the choice
of the complainant;
(c) Dispute involving real property shall be brought for settlement in the
barangay where the real property or larger portion thereof is situated;
(d) Disputes arising at the workplace where the contending parties are
employed or at the institution where such parties are enrolled for study,
shall be brought in the barangay where such workplace or institution is
located;
(e) Any objection relating to venue shall be raised before the Punong
Barangay during the mediation proceedings before him. Failure to do so
shall be deemed a waiver of such objection;
(f) Any legal question which may confront the Punong Barangay in
resolving objections to venue herein referred to may be submitted to the
Secretary of Justice, or his duly designated representative, whose ruling
thereon shall be binding. brando
(Emphasis added)
Indeed, these provisions, which are also found in P.D. No. 1508, have already been
authoritatively interpreted by this Court, and the duty of respondent judge was to follow
the rulings of this Court. Her insistence on her own interpretation of the law can only be
due either to an ignorance of this Courts ruling or to an utter disregard thereof. We
choose to believe that her failure to apply our rulings to the case before her was simply
due to gross ignorance which, nevertheless, is inexcusable. In accordance with the
ruling in Ting v. Atal, in which a judge who was similarly found guilty of gross ignorance
of the law was fined P2,000.00, respondent judge should likewise be fined the same
amount.
[7]

WHEREFORE, respondent is hereby found guilty of gross ignorance of the law and is
hereby ordered to pay a FINE of TWO THOUSAND (P2,000.00) PESOS with a
WARNING that repetition of the same or similar acts will be dealt with more severely.
SO ORDERED.
Bellosillo, (Chairman), Quisumbing, Buena, and De Leon, Jr., JJ., concur. micks

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-60367 September 30, 1982
ATTY. VENUSTIANO T. TAVORA, petitioner,
vs.
HON. ROSARIO R. VELOSO, in her capacity as the Presiding Judge of Branch III of the City
Court of Manila, and JULIETA CAPATI, respondents.

PLANA, J.:

Venustiano T. Tavora, a resident of Marikina, Metro Manila, owns an apartment in Quiapo, Manila
which he has leased to Julieta Capati, a resident of Quiapo. On account of alleged violations of the
lease agreement by the lessee (unauthorized subleasing and failure to pay rent), the lessor filed on
January 12, 1981 an ejectment suit (Civil Case No. 060828) in the City Court of Manila. The
defendant filed a motion t/ dismiss on the sole ground of lack of jurisdiction for failure of the plaintiff
to bring the dispute first to the barangay court for possible amicable settlement under PD 1508.
Parenthetically, there is no question that there has been no attempt to amicably settle the dispute
between Tavora and Capati at the barangay level.
After denying the motion to dismiss as well as a subsequent motion for reconsideration, the
municipal court reversed itself and dismissed the ejectment case.
Alleging grave abuse of discretion amounting to lack of jurisdiction, petitioner Tavora has come to
this Court on certiorari and mandamus praying that the order of dismissal be set aside and that
respondent judge be ordered to hear and decide the case.
The sole issue raised is one of law: Under the given facts, is the respondent judge barred from
taking cognizance of the ejectment case pursuant to Sec-6 of PD 1508 establishing a system of
amicably settling disputes at the barangay level? The section reads:
SECTION 6. Conciliation, precondition to filing of complaint. No complaint,
petition, action or proceeding involving any matter within the authority of the
Lupon as provided in Section 2 hereof shall be filed or instituted in court or any other
government office for adjudication unless there has been a confrontation of the
parties before the Lupon Chairman or the Pangkat and no conciliation or settlement
has been reached as certified by the Lupon Secretary or the Pangkat Secretary,
attested by the Lupon or Pangkat Chairman, or unless the settlement has been
repudiated ... (Emphasis supplied.)
For the above provision to be operative, the controversy must be within the jurisdiction of the Lupong
Tagapayapa (Lupon or Barangay court). On this point, the relevant provisions of PD 1508 are:
SECTION 2. Subject matters for amicable settlement. The Lupon of each
barangay shall have authority to bring together the parties actually residing in the
same city or municipality for amicable settlement of all disputes except:
(1) Where one party is the government, or any subdivision or instrumentality thereof;
(2) Where one party is a public officer or employee, and the dispute relates to the
performance of his official functions;
(3) Offenses punishable by imprisonment exceeding 30 days, or a fine exceeding
P200.00;
(4) Offenses where there is no private offended party;

(5) Such other classes of disputes which the Prime Minister may in the interest of
justice determine, upon recommendation of the Minister of Justice and the Minister of
Local Government.
SECTION 3. Venue. Disputes between or among persons actually residing in the
same barangayshall be brought for amicable settlement before the Lupon of said
barangay. Those involving actual residents of different barangays within the same
city or municipality shall be brought in the barangay where the respondent or any of
the respondents actually resides, at the election of the complainant. However, all
disputes which involve real property or any interest therein shall be brought in the
barangay where the real property or any part thereof is situated.
The Lupon shall have no authority over disputes:
(1) involving parties who actually reside in barangays of different cities or
municipalities, except where such barangays adjoin each other; and
(2) involving real property located in different municipalities. (Emphasis supplied.)
The foregoing provisions are quite clear. Section 2 specifies the conditions under which the Lupon of
a barangay "shall have authority" to bring together the disputants for amicable settlement of their
dispute: The parties must be "actually residing in the same city or municipality." At the same time,
Section 3 while reiterating that the disputants must be "actually residing in the same barangay" or
in "different barangays within the same city or municipality unequivocably declares that the Lupon
shall have "no authority" over disputes "involving parties who actually reside in barangays
of different cities or municipalities," except where such barangays adjoin each other.
Thus, by express statutory inclusion and exclusion, the Lupon shall have no jurisdiction over
disputes where the parties are not actual residents of the same city or municipality, except where the
barangays in which they actually reside adjoin each other,
It is true that immediately after specifying the barangay whose Lupon shall take cognizance of a
given dispute, Sec. 3 of PD 1508 adds:
However, all disputes which involve real property or any interest therein shall be
brought in the barangay where the real property or any part thereof is situated.
Actually, however, this added sentence is just an ordinary proviso and should operate as such. The
operation of a proviso, as a rule, should be limited to its normal function, which is to restrict or vary
the operation of the principal clause, rather than expand its scope, in the absence of a clear
indication to the contrary.
The natural and appropriate office of a proviso is . . . to except something from the
enacting clause; to limit, restrict, or qualify the statute in whole or in part; or to
exclude from the scope of the statute that which otherwise would be within its terms.
(73 Am Jur 2d 467.)

Therefore, the quoted proviso should simply be deemed to restrict or vary the rule on
venue prescribed in the principal clauses of the first paragraph of Section 3, thus: Although venue is
generally determined by the residence of the parties, disputes involving real property shall be
brought in the barangay where the real property or any part thereof is situated, notwithstanding that
the parties reside elsewhere within the same city/municipality.
In the instant case, the plaintiff in the ejectment case (petitioner herein) is a resident of Marikina,
while the defendant (private respondent) is a resident of Quiapo. No Lupon therefore is authorized to
take cognizance of their dispute.
Finding the petition to be meritorious, the dismissal of Civil Case No. 060828 (ejectment) by the
respondent Judge being predicated upon a misconstruction of PD 1508, the same should be
granted. (Co Tiamco vs. Diaz, 75 Phil. 672.)
Accordingly, the assailed order of dismissal dated February 22, 1982 as well as the order dated
March 23, 1982 denying reconsideration thereof, are hereby set aside; and the respondent Judge is
directed to hear and decide the aforesaid ejectment case on its merits. Costs against private
respondents.
SO ORDERED.
Fernando CJ., Teehankee, Barredo, Makasiar, Aquino, Concepcion, Jr., Guerrero, Abad Santos, De
Castro, Melencio-Herrera, Escolin, Vasquez and Gutierrez, JJ., concur.
Relova, J., took no part.

Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 82211-12 March 21, 1989

TERESITA MONTOYA, petitioner,

vs.
TERESITA ESCAYO, JOY ESCAYO, AIDA GANANCIAL, MARY ANN CAPE, CECILIA
CORREJADO, ERLINDA PAYPON and ROSALIE VERDE, AND NATIONAL LABOR RELATIONS
COMMISSION, respondents.
Rolando N. Medalla and Segundo Y Chua for petitioner.
The Solicitor General for public respondent.
Archie S. Baribar for private respondents.

SARMIENTO, J.:
This petition for certiorari seeks the annullment and setting aside of the resolution

1 9dated August 20, 1987

of the National Labor Relations Commission (NLRC), Third Division, which reversed and set aside the order dated September 27, 1985 of
Labor Arbiter Ethelwoldo R. Ovejera of the NLRC's Regional Arbitration Branch No. VI, Bacolod City, dismissing the complaint filed by the
private respondents against the petitioner. This petition raises a singular issue, i.e., the applicability of Presidential Decree (P.D.) No. 1508,
more commonly known as the Katarungang Pambarangay Law, to labor disputes.

The chronology of events leading to the present controversy is as follows:

The private respondents were all formerly employed as salesgirls in the petitioner's store, the
"Terry's Dry Goods Store," in Bacolod City. On different dates, they separately filed complaints for
the collection of sums of money against the petitioner for alleged unpaid overtime pay, holiday pay,
13th month pay, ECOLA, and service leave pay: for violation of the minimum wage law, illegal
dismissal, and attorney's fees. The complaints, which were originally treated as separate cases,
were subsequently consolidated on account of the similarity in their nature. On August 1, 1984, the
petitioner-employer moved (Annex "C" of Petition) for the dismissal of the complaints, claiming that
among others, the private respondents failed to refer the dispute to the Lupong Tagapayapa for
possible settlement and to secure the certification required from the Lupon Chairman prior to the
filing of the cases with the Labor Arbiter. These actions were allegedly violative of the provisions of
P.D. No. 1508, which apply to the parties who are all residents of Bacolod City.
Acting favorably on the petitioner's motion, Labor Arbiter Ethelwoldo R. Ovejera, on September 27,
1985, ordered the dismissal of the complaints. The private respondents sought the reversal of the
Labor Arbiter's order before the respondent NLRC. On August 20, 1987, the public respondent
rendered the assailed resolution reversing the order of Ovejera, and remanded the case to the Labor
Arbiter for further proceedings. A motion for reconsideration was filed by the petitioner but this was
denied for lack of merit on October 28, 1987. Hence, this petition.
It is the petitioner's contention that the provisions of the Katarungang Pambarangay Law (P.D. No.
1508) relative to the prior amicable settlement proceedings before the Lupong Tagapayapa as a
jurisdictional requirement at the trial level apply to labor cases. More particularly, the petitioner insists
that the failure of the private respondents to first submit their complaints for possible conciliation and
amicable settlement in the proper barangay court in Bacolod City and to secure a certification from
the Lupon Chairman prior to their filing with the Labor Arbiter, divests the Labor Arbiter, as well as

the respondent Commission itself, of jurisdiction over these labor controversies and renders their
judgments thereon null and void.
On the other hand, the Solicitor General, as counsel for the public respondent NLRC, in his
comment, strongly argues and convincingly against the applicability of P.D. No. 1508 to labor cases.
We dismiss the petition for lack of merit, there being no satisfactory showing of any grave abuse of
discretion committed by the public respondent.
The provisions of P.D. No. 1508 requiring the submission of disputes before the barangay Lupong
Tagapayapa prior to their filing with the court or other government offices are not applicable to labor
cases.
For a better understanding of the issue in this case, the provisions of P.D. No. 1508 invoked by the
petitioner are quoted:
SEC. 6. Conciliation pre-condition to filing of complaint. No complaint, petition, action
or proceeding involving any matter within the authority of the Lupon as provided in
Section 2 hereof shall be filed or instituted in court or any other government office for
adjudication unless there has been a confrontation of the parties before the Lupon
Chairman or the Pangkat and no conciliation or settlement has been reached as
certified by the Lupon Secretary or the Pangkat Secretary, attested by the Lupon or
Pangkat Chairman, or unless the settlement has been repudiated. However, the
parties may go directly to court in the following cases:
(1) Where the accused is under detention;
(2) Where a person has otherwise been deprived of per sonal liberty calling for
habeas corpus proceedings;
(3) Actions coupled with provisional remedies such as preliminary injunction,
attachment, delivery of personal property and support pendente lite; and
(4) Where the action may otherwise be barred by the Statute of Limitations.
As correctly pointed out by the Solicitor General in his comment to the petition, even from the three
"WHEREAS" clauses of P.D. No. 1508 can be gleaned clearly the decree's intended applicability
only to courts of justice, and not to labor relations commissions or labor arbitrators' offices. The
express reference to "judicial resources", to "courts of justice", "court dockets", or simply to "courts"
are significant. On the other band, there is no mention at all of labor relations or controversies and
labor arbiters or commissions in the clauses involved.
These "WHEREAS" clauses state:
WHEREAS, the perpetuation and official recognition of the time-honored tradition of
amicably settling disputes among family and barangay members at the barangay
level without judicial resources would promote the speedy administration of justice

and implement the constitutional mandate to preserve and develop Filipino culture
and to strengthen the family as a basic social institution;
WHEREAS, the indiscriminate filing of cases in the courts of justice contributes
heavily and unjustifiably to the congestion of court dockets, thus causing a
deterioration in the quality of justice;
WHEREAS, in order to help relieve the courts of such docket congestion and thereby
enhance the quality of Justice dispensed by the courts, it is deemed desirable to
formally organize and institutionalize a system of amicably settling disputes at the
barangay level; (Emphasis supplied.)
In addition, Letter of Instructions No. 956 and Letter of Implementation No. 105, both issued on
November 12, 1979 by the former President in connection with the implementation of the
Katarungang Pambarangay Law, affirm this conclusion. These Letters were addressed only to the
following officials: all judges of the Courts of first Instance, Circuit Criminal Courts, Juvenile and
Domestic Relations Courts, Courts of Agrarian Relations, City Courts and Municipal Courts, and all
Fiscals and other Prosecuting Officers. These presidential issuances make clear that the only official
directed to oversee the implementation of the provisions of the Katarungang Pambarangay Law
(P.D. No. 1508) are the then Minister of Justice, the then Minister of Local Governments and
Community Development, and the Chief Justice of the Supreme Court. If the contention of the
petitioner were correct, the then Minister (now Secretary) of Labor and Employment would have
been included in the list, and the two presidential issuances also would have been addressed to the
labor relations officers, labor arbiters, and the members of the National Labor Relations
Commission. Expressio unius est exclusio alterius.
Nor can we accept the petitioner's contention that the "other government office" referred to in
Section 6 of P.D. No. 1508 includes the Office of the Labor Arbiter and the Med-Arbiter. The declared
concern of the Katarungan Pambarangay Law is "to help relieve the courts of such docket
congestion and thereby enhance the quality of justice dispensed by the courts." Thus, the" other
government office" mentioned in Section 6 of P.D. No. 1508 refers only to such offices as the Fiscal's
Office or, in localities where there is no fiscal, the Municipal Trial Courts, where complaints for crimes
(such as those punishable by imprisonment of not more than 30 days or a, fine of not more than P
200.00) falling under the jurisdiction of the barangay court but which are not amicably settled, are
subsequently filed for proper disposition.
But, the opinion of the Honorable Minister of Justice (Opinion No. 59, s. 1983) to the contrary
notwithstanding, all doubts on this score are dispelled by The Labor Code Of The Philippines
(Presidential Decree No. 442, as amended) itself. Article 226 thereof grants original and exclusive
jurisdiction over the conciliation and mediation of disputes, grievances, or problems in the regional
offices of the Department of Labor and Employ- ment. It is the said Bureau and its divisions, and not
the barangay Lupong Tagapayapa, which are vested by law with originaland exclusive authority to
conduct conciliation and mediation proceedings on labor controversies before their endorsement to
the appropriate Labor Arbiter for adjudication. Article 226, previously adverted to is clear on this
regard. It provides:
ART. 226. Bureau of Labor Relations.- The Bureau of Labor Relations and the Labor
relations divisions in the regional officer of the Department of Labor shall have
original and exclusive authority to act, at their own initiative or upon request of either

or both parties, on all inter-union and intra-union conflicts, and all disputes,
grievances or problems arising from or affecting labor-management relations in all
workplaces whether agricultural or non-agricultural, except those arising from the
implementation or interpretation of collective bargaining agreements which shall be
the subject of grievance procedure and/or voluntary arbitration.
The Bureau shall have fifteen (15) working days to act on all labor cases, subject to
extension by agreement of the parties, after which the Bureau shall certify the cases
to the appropriate Labor Arbiters. The 15-working day deadline, however, shall not
apply to cases involving deadlocks in collective bargaining which the Bureau shall
certify to the appropriate Labor Arbiters only after all possibilities of voluntary
settlement shall have been tried.
Requiring conciliation of labor disputes before the barangay courts would defeat the very salutary
purposes of the law. Instead of simplifying labor proceedings designed at expeditious settlement or
referral to the proper court or office to decide it finally, the position taken by the petitioner would only
duplicate the conciliation proceedings and unduly delay the disposition of the labor case. The fallacy
of the petitioner's submission can readily be seen by following it to its logical conclusion. For then, if
the procedure suggested is complied with, the private respondent would have to lodge first their
complaint with the barangay court, and then if not settled there, they would have to go to the labor
relations division at the Regional Office of Region VI of the Department of Labor and Employment, in
Bacolod City, for another round of conciliation proceedings. Failing there, their long travail would
continue to the Office of the Labor Arbiter, then to the NLRC, and finally to us. This suggested
procedure would destroy the salutary purposes of P.D. 1508 and of The Labor Code Of The
Philippines. And labor would then be given another unnecessary obstacle to hurdle. We reject the
petitioner's submission. It does violence to the constitutionally mandated policy of the State to afford
full protection to labor. 2
Finally, it is already well-settled that the ordinary rules on procedure are merely suppletory in
character vis-a-vis labor disputes which are primarily governed by labor laws. 3 And "(A)ll doubts in the
implementation and interpretation of this Code (Labor), including its implementing rules and regulations, shall be resolved in favor of labor. 4

WHEREFORE, the petition is DISMISSED. Costs against the petitioner.

SO ORDERED.
Melencio-Herrera, (Chairperson), Paras, Padilla and Regalado, JJ., concur.

Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 162084

June 28, 2005

APRIL MARTINEZ, FRITZ DANIEL MARTINEZ and MARIA OLIVIA MARTINEZ, petitioners,
vs.
RODOLFO G. MARTINEZ, respondent.
DECISION
CALLEJO, SR., J.:
This is a petition for review on certiorari of the Decision1 of the Court of Appeals (CA) in CA-G.R. SP
No. 59420 setting aside and reversing the decision of the Regional Trial Court (RTC) of Manila,
Branch 30, in Civil Case No. 00-96962 affirming, on appeal, the decision of the Metropolitan Trial
Court (MTC) of Manila in Civil Case No. 164761 (CV) for ejectment.
The Antecedents
The spouses Daniel P. Martinez, Sr. and Natividad de Guzman-Martinez were the owners of a parcel
of land identified as Lot 18-B-2 covered by Transfer Certificate of Title (TCT) No. 54334, as well as
the house constructed thereon.2 On March 6, 1993, Daniel, Sr. executed a Last Will and
Testament3 directing the subdivision of the property into three lots, namely, Lots 18-B-2-A, 18-B-2-B
and 18-B-2-C. He then bequeathed the three lots to each of his sons, namely, Rodolfo, Manolo and
Daniel, Jr.; Manolo was designated as the administrator of the estate.
In May 1995, Daniel, Sr. suffered a stroke which resulted in the paralysis of the right side of his body.
Natividad died on October 26, 1996.4 Daniel, Sr. passed away on October 6, 1997.5
On September 16, 1998, Rodolfo found a deed of sale purportedly signed by his father on
September 15, 1996, where the latter appears to have sold Lot 18-B-2 to Manolo and his wife
Lucila.6 He also discovered that TCT No. 237936 was issued to the vendees based on the said deed
of sale.7
Rodolfo filed a complaint8 for annulment of deed of sale and cancellation of TCT No. 237936 against
his brother Manolo and his sister-in-law Lucila before the RTC. He also filed a criminal complaint
for estafa through falsification of a public document in the Office of the City Prosecutor against
Manolo, which was elevated to the Department of Justice. 9
On motion of the defendants, the RTC issued an Order10 on March 29, 1999, dismissing the
complaint for annulment of deed of sale on the ground that the trial court had no jurisdiction over the
action since there was no allegation in the complaint that the last will of Daniel Martinez, Sr. had
been admitted to probate. Rodolfo appealed the order to the CA.11

On October 4, 1999, Rodolfo filed a Petition with the RTC of Manila for the probate of the last will of
the deceased Daniel Martinez, Sr.12
In the meantime, the spouses Manolo and Lucila Martinez wrote Rodolfo, demanding that he vacate
the property. Rodolfo ignored the letter and refused to do so. This prompted the said spouses to file
a complaint for unlawful detainer against Rodolfo in the MTC of Manila. They alleged that they were
the owners of the property covered by TCT No. 237936, and that pursuant to Presidential Decree
(P.D.) No. 1508, the matter was referred to thebarangay for conciliation and settlement, but none
was reached. They appended the certification to file action executed by the barangay chairman to
the complaint.
In his Answer13 to the complaint filed on October 11, 1999, Rodolfo alleged, inter alia, that the
complaint failed to state a condition precedent, namely, that earnest efforts for an amicable
settlement of the matter between the parties had been exerted, but that none was reached. He also
pointed out that the dispute had not been referred to the barangay before the complaint was filed.
On October 20, 1999, the spouses Martinez filed an Amended Complaint in which they alleged that
earnest efforts toward a settlement had been made, but that the same proved futile. Rodolfo filed his
opposition thereto, on the ground that there was no motion for the admission of the amended
complaint. The trial court failed to act on the matter.
The spouses Martinez alleged in their position paper that earnest efforts toward a compromise had
been made and/or exerted by them, but that the same proved futile. 14 No amicable settlement was,
likewise, reached by the parties during the preliminary conference because of irreconcilable
differences. The MTC was, thus, impelled to terminate the conference.15
On February 21, 2000, the trial court rendered judgment in favor of the spouses Martinez.
The fallo of the decision reads:
WHEREFORE, premises considered, judgment is rendered in favor of plaintiff. The defendant,
including any person claiming right under him, is ordered:
1) To vacate the subject premises;
2) To pay plaintiff the sum of P10,000.00 a month starting July 17, 1999, the date of last
demand until he vacates the same;
3) To pay the sum of P10,000.00 as and for attorneys fees; and
4) Costs of suit.
SO ORDERED.16
The trial court declared that the spouses Martinez had substantially complied with Article 151 of the
Family Code of the Philippines17 based on the allegations of the complaint and the appended
certification to file action issued by the barangay captain.

Rodolfo appealed the decision to the RTC. On May 31, 2000, the RTC rendered judgment affirming
the appealed decision. He then filed a petition for review of the decision with the CA, alleging that:
1. THE RTC ERRED IN AFFIRMING THE DECISION OF THE MTC WHICH FOUND WITHOUT
MERIT THE DEFENSE OF PETITIONER THAT THERE IS NO ALLEGATION IN THE COMPLAINT
THAT PETITIONER HAS UNLAWFULLY WITHHELD POSSESSION OF THE PROPERTY FROM
RESPONDENTS A REQUIREMENT IN [AN] UNLAWFUL DETAINER SUIT.
2. THE RTC ERRED IN AFFIRMING THE DECISION OF THE MTC WHICH FOUND THAT
PETITIONERS POSSESSION OF THE PROPERTY IS BY MERE TOLERANCE OF
RESPONDENTS.
3. THE RTC ERRED IN AFFIRMING THE DECISION OF THE MTC WHICH FOUND THAT THE
RESPONDENTS HAVE A CAUSE OF ACTION.
4. THE RTC ERRED IN AFFIRMING THE DECISION OF THE MTC WHICH DID NOT RESOLVE
THE SIXTH ISSUE, TO WIT, "Whether or not this Court has jurisdiction over this case considering
that the allegations in the complaint makes out a case of accion publiciana."
5. THE RTC ERRED IN AFFIRMING THE DECISION OF THE MTC WHICH HAS NO
JURISDICTION OVER THE CASE.
6. THE RTC ERRED IN AFFIRMING THE DECISION OF THE MTC WHICH FOUND THAT THE
MANDATORY REQUIREMENT OF CONCILIATION HAS BEEN COMPLIED WITH.
7. THE RTC ERRED IN AFFIRMING THE DECISION OF THE MTC WHICH FOUND THAT THERE
WAS SUBSTANTIAL COMPLIANCE WITH THE KATARUNGANG PAMBARANGAY LAW.
8. THE RTC ERRED IN AFFIRMING THE DECISION OF THE MTC WHICH FOUND THAT THE
PENDENCY OF CIVIL CASE NO. 98-91147 AND SPECIAL PROCEEDINGS NO. 99-95281,
INVOLVING THE PETITIONER AND RESPONDENTS AND INVOLVING THE SAME PROPERTY
DID NOT DIVEST THE MTC OF AUTHORITY TO DECIDE THE CASE.
9. THE RTC ERRED IN AFFIRMING THE DECISION OF THE MTC WHICH GRANTED THE
RELIEF PRAYED FOR BY THE RESPONDENTS.
10. THE RTC ERRED IN AFFIRMING THE DECISION OF THE MTC.18
On November 27, 2003, the CA rendered judgment granting the petition and reversing the decision
of the RTC. The appellate court ruled that the spouses Martinez had failed to comply with Article 151
of the Family code. The CA also held that the defect in their complaint before the MTC was not cured
by the filing of an amended complaint because the latter pleading was not admitted by the trial court.
Upon the denial of their motion for reconsideration of the said decision, the spouses Martinez filed
the present petition for review on certiorari, in which they raise the following issues:
I.

WHETHER OR NOT THE CERTIFICATION TO FILE ACTION AND THE ALLEGATIONS IN THE
COMPLAINT THAT THE CASE PASSED [THROUGH] THE BARANGAY BUT NO SETTLEMENT
WAS REACHED, ARE SUFFICIENT COMPLIANCE TO PROVE THAT, INDEED, EARNEST
EFFORTS WERE, IN FACT, MADE BUT THE SAME HAVE FAILED PRIOR TO THE FILING OF
THE COMPLAINT.
II.
WHETHER OR NOT THE COURT OF APPEALS GRAVELY AND SERIOUSLY ERRED IN FINDING
THAT THERE WAS NON-COMPLIANCE WITH THE REQUIREMENT PROVIDED FOR UNDER
ARTICLE 151 OF THE FAMILY CODE, CONSIDERING THAT ONE OF THE PARTIES TO A SUIT IN
THIS CASE IS NOT A MEMBER OF THE SAME FAMILY.19
The petitioners alleged that they substantially complied with Article 151 of the Family Code, since
they alleged the following in their original complaint:
2. In compliance with P.D. 1508, otherwise known as the "Katarungang Pambarangay," this case
passed [through] the Barangay and no settlement was forged between plaintiffs and defendant as a
result of which Certification to File Action was issued by Barangay 97, Zone 8, District I, Tondo,
Manila. xxx" (Underscoring supplied)20
Further, the petitioners averred, they alleged in their position paper that they had exerted earnest
efforts towards a compromise which proved futile. They also point out that the MTC resolved to
terminate the preliminary conference due to irreconcilable difference between the parties. Besides,
even before they filed their original complaint, animosity already existed between them and the
respondent due to the latters filing of civil and criminal cases against them; hence, the objective of
an amicable settlement could not have been attained. Moreover, under Article 150 of the Family
Code, petitioner Lucila Martinez had no familial relations with the respondent, being a mere sister-inlaw. She was a stranger to the respondent; hence, there was no need for the petitioners 21 to comply
with Article 151 of the Family Code.
The petition is meritorious.
Article 151 of the Family Code provides:
Art. 151. No suit between members of the same family shall prosper unless it should appear from
the verified complaint or petition that earnest efforts toward a compromise have been made, but that
the same have failed. If it is shown that no such efforts were, in fact, made, the case must be
dismissed.
This rule shall not apply to cases which may not be the subject of compromise under the Civil Code.
The phrase "members of the family" must be construed in relation to Article 150 of the Family Code,
to wit:
Art. 150. Family relations include those:
(1) Between husband and wife;

(2) Between parents and children;

(3) Among other ascendants and descendants; and
(4) Among brothers and sisters, whether of the full or half-blood.
Article 151 of the Family code must be construed strictly, it being an exception to the general rule.
Hence, a sister-in-law or brother-in-law is not included in the enumeration. 22
As pointed out by the Code Commission, it is difficult to imagine a sadder and more tragic spectacle
than a litigation between members of the same family. It is necessary that every effort should be
made toward a compromise before a litigation is allowed to breed hate and passion in the family and
it is known that a lawsuit between close relatives generates deeper bitterness than between
strangers.23
Thus, a partys failure to comply with Article 151 of the Family Code before filing a complaint against
a family member would render such complaint premature.
In this case, the decision of the CA that the petitioners were mandated to comply with Article 151 of
the Family code and that they failed to do so is erroneous.
First. Petitioner Lucila Martinez, the respondents sister-in-law, was one of the plaintiffs in the MTC.
The petitioner is not a member of the same family as that of her deceased husband and the
respondent:
As regards plaintiffs failure to seek a compromise, as an alleged obstacle to the present case, Art.
222 of our Civil Code provides:
"No suit shall be filed or maintained between members of the same family unless it should appear
that earnest efforts toward a compromise have been made, but that the same have failed, subject to
the limitations in Article 2035."
It is noteworthy that the impediment arising from this provision applies to suits "filed or maintained
betweenmembers of the same family." This phrase, "members of the same family," should, however,
be construed in the light of Art. 217 of the same Code, pursuant to which:
"Family relations shall include those:
(1) Between husband and wife;
(2) Between parent and child;
(3) Among other ascendants and their descendants;
(4) Among brothers and sisters."
Mrs. Gayon is plaintiffs sister-in-law, whereas her children are his nephews and/or nieces. Inasmuch
as none of them is included in the enumeration contained in said Art. 217 which should be

construed strictly, it being an exception to the general rule and Silvestre Gayon must necessarily
be excluded as party in the case at bar, it follows that the same does not come within the purview of
Art. 222, and plaintiffs failure to seek a compromise before filing the complaint does not bar the
same.24
Second. The petitioners were able to comply with the requirements of Article 151 of the Family Code
because they alleged in their complaint that they had initiated a proceeding against the respondent
for unlawful detainer in the Katarungang Pambarangay, in compliance with P.D. No. 1508; and that,
after due proceedings, no amicable settlement was arrived at, resulting in the barangay chairmans
issuance of a certificate to file action.25 The Court rules that such allegation in the complaint, as well
as the certification to file action by the barangay chairman, is sufficient compliance with article 151 of
the Family Code. It bears stressing that under Section 412(a) of Republic Act No. 7160, no complaint
involving any matter within the authority of the Lupon shall be instituted or filed directly in court for
adjudication unless there has been a confrontation between the parties and no settlement was
reached.26
IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The Decision of the Court of
Appeals in CA-G.R. SP No. 59420 is REVERSED AND SET ASIDE. The Decision of the
Metropolitan Trial Court of Manila, as affirmed on appeal by the Regional Trial Court of Manila,
Branch 30, in Civil Case No. 164761(CV) is REINSTATED. No costs.
SO ORDERED.
Puno, (Chairman), Austria-Martinez, Tinga, and Chico-Nazario, JJ., concur.

SECOND DIVISION
ESTELA L. BERBA,
Petitioner,

G.R. No. 160032

Present:

- versus -

PUNO, J., Chairman,

AUSTRIA-MARTINEZ,
CALLEJO, SR.,
TINGA, and
CHICO-NAZARIO,* JJ.

JOSEPHINE PABLO and THE

Promulgated:
HEIRS OF CARLOS PALANCA,
Respondents.
November 11, 2005
x------------------------------------ --------------x
DECISION
CALLEJO, SR., J.:

Assailed before the Court on a petition for review on certiorari is the

Decision[1] of the Court of Appeals (CA) in CA-G.R. SP No. 73531, affirming the
Decision[2] of the Regional Trial Court (RTC) of Manila in Civil Case No. 170639.
Estela L. Berba, a resident of 978 Maligaya Street, Malate, Manila, was the
owner of a parcel of land located at No. 2338 M. Roxas Street, Sta. Ana, Manila
covered by Transfer Certificate of Title (TCT) No. 63726. A house was constructed
on the lot, which she leased to Josephine Pablo and the Heirs of Carlos Palanca
sometime in 1976. The lease was covered by a lease contract. Upon its expiration,
the lessees continued leasing the house on a month-to-month basis.
By 1999, the monthly rental on the property was P3,450.00. The lessees
failed to pay the rentals due, and by May 1999, their arrears amounted
to P81,818.00. Berba then filed a complaint for eviction and collection of unpaid
rentals only against Pablo in the Office of the Punong Barangay. On June 5, 1999,
Berba and Pablo executed an Agreement approved by the pangkat, as follows:
Ako si Josephine Pablo, naninirahan sa 2338 M. Roxas St., Sta.
Ana, Manila, na nasasakop ng Barangay 873, Zone 96, ay nangangako
kay GG Robert Berba na nagmamay-ari ng aking tinitirahan ay
maghuhulog ng halagang Tatlong Libong Piso P3,000.00 kada ikasampu ng buwan bilang hulog sa aking pagkakautang kay GG Berba na
umaabot sa halagangP81,818.00 na ang nasabing halagang ito ay aking
huhulugan hanggang aking mabayaran ng buo ang aking
pagkakautang. Ako rin, si Josephine Pablo, ay nangangako na ang
hindi ko pagsunod o pagbayad ng buwanang hulog, ako ay kusang aalis
sa aking tinitirahan. Bukod pa sa hulog sa aking pagkakautang, ako rin
ay magbabayad ng halagang P3,450.00 bilang aking upa sa aking
tinitirahan.[3]

By May 2000, Pablo and the lessees still had a balance of P71,716.00. As of
May 1, 2001, the total arrearages of the lessees amounted to P135,115.63.[4] On

May 2, 2001, Berba, through counsel, wrote the lessees, demanding payment of the
said amount and to vacate the house within 30 days from notice, otherwise she will
sue them.[5] The lessees ignored the demand. On June 21, 2001, Berba filed a
complaint[6] against Josephine Pablo and the Heirs of Carlos Palanca in the
Metropolitan Trial Court (MTC) of Manila for unlawful detainer. She prayed that,
after due proceedings, judgment be rendered in her favor:
WHEREFORE, it is most respectfully prayed for that judgment be
rendered in favor of plaintiff ordering defendant (sic)
a)
b)

c)

d)
e)
f)

to vacate the premises situated at 2338 M. Roxas

Street, Sta. Ana, City of Manila;
to pay plaintiff the sum of One Hundred Thirty-Five
Thousand One Hundred Fifteen and 63/100 Pesos
(P135,115.63) representing monthly rentals in arrears to
the present;
to pay plaintiff the amount of Four Thousand Five
Hundred Sixty-Two and 63/100 Pesos (P4,562.63) per
month representing monthly rent on the premises for
the year 2001 until finality of the judgment;
to pay plaintiff the sum of Twenty Thousand Pesos
(P20,000.00) by way of attorneys fees;
to reimburse plaintiff all expenses for litigation
estimated in the amount of Ten Thousand Pesos;
to pay costs of suit.

Other reliefs just and equitable are, likewise, prayed for under the
premises.[7]

Berba, however, failed to append to her complaint a certification from

the Lupon ng Tagapamayapa that no conciliation or settlement had been reached.
In their answer to the complaint, the defendants admitted to have stopped
paying rentals because of financial distress. They also alleged that they were not
certain if the plaintiff was the owner of the property. By way of special and

affirmative defenses, they averred that the plaintiff had no cause of action against
them as she failed to secure a Certificate to File Action from the Lupon.[8]
During the pre-trial conference, the parties manifested to the court that,
despite earnest efforts, no amicable settlement was reached. They defined the main
issue as whether or not the plaintiff had a valid cause of action for unlawful
detainer against the defendants.[9]
In her position paper, Berba appended an Agreement dated June 5, 1999
between her and Pablo, which appeared to have been approved by Punong
Barangay Cayetano L. Gonzales of Barangay 873, as well as other members of
the Lupon,[10] duly approved by the Pangkat. She also appended a Statement of
Account indicating that the defendants back rentals amounted to P135,115.63.[11]
In their position paper, the defendants insisted that the dispute did not go
through the Lupon ng Tagapamayapa prior to the filing of the complaint; hence,
Berbas complaint was premature. They also averred that the increase in the rental
rates imposed by the plaintiff was unjustified and illegal.
In her reply, the plaintiff alleged that there was no more need for her to
secure a Certificate to File Action because she was a resident of No. 978 Maligaya
Street, Malate, Manila, while the defendants were residing in Barangay 873, Zone
6 in Sta. Ana, Manila.
On March 14, 2002, the MTC rendered judgment in favor of Berba.
The fallo of the decision reads:
WHEREFORE, judgment is rendered in favor of the plaintiff and
ordering the defendants and all persons claiming rights under them to
vacate the premises at 2338 M. Roxas St., Sta. Ana, Manila and restore
possession thereof to the plaintiff. Ordering the defendant to pay the
amount of P135,115.63 representing monthly rentals since 1999 until

December 2000. Ordering the defendant to pay the plaintiff the sum
of P4,562.63 per month beginning January 2001 and for the succeeding
months until finally vacated. Ordering the defendant to pay the reduced
amount of P10,000.00 as attorneys fees plus the costs of suit.
SO ORDERED.[12]

The defendants appealed the decision to the RTC. On motion of the plaintiff,
the RTC issued an order for the execution of the decision pending appeal. [13] The
defendants filed a motion for the recall of the Order,[14] but before the court could
resolve the motion, the Sheriff turned over the physical possession of the property
to Berba on May 20, 2002.[15]
In their Appeal Memorandum, Pablo and the heirs of Palanca insisted that
Berbas action in the MTC was premature because of the absence of Certificate to
File Action issued by the Lupon. They also claimed that Berba unlawfully
increased the rentals for the house.[16] Berba, on the other hand, averred that there
was no need of a prior referral to the Lupon before filing her complaint. The
petitioner cited Section 408(f) of the Local Government Code, pointing out that she
resided in a Barangay in Malate, 8 kilometers away from Barangay 873 in Sta.
Ana, where Pablo and the Palanca heirs resided.[17]
On August 20, 2002, the RTC rendered judgment granting the appeal and
setting aside the appealed decision. The fallo of the decision reads:
WHEREFORE, the decision of the Court a quo is ordered set
aside. The complaint is also ordered DISMISSED WITHOUT
PREJUDICE. The Writ of Execution issued by the Court a quo pending
appeal is also set aside.
SO ORDERED.[18]

The RTC ruled that under Section 408 of the Local Government Code,
parties

who

reside

in

the

same

city

or

municipality

although

in

different barangays are mandated to go through conciliation proceedings in

the Lupon.[19] The court cited the rulings of this Court in Morata v. Go,[20] and Vda.
de Borromeo v. Pogoy.[21]
Berba filed a motion for the reconsideration[22] of the decision, which
the RTC denied in its Order[23] dated October 2, 2002. She then elevated the case to
the CA viapetition for review, where she averred:
a)

The raising of other affirmative defenses apart from the non-referral

to the Barangay Court by the respondents constitute a waiver of such
requirement; and

b)

There was substantial compliance on the part of the petitioner with

respect to referring her complaint before the Barangay Court.[24]

Citing the ruling of this Court in Diu v. Court of Appeals,[25] Berba claimed
that Section 408 of the Local Government Code should be construed liberally
together with Section 412. She further averred that she had complied substantially
with the requisites of the law, and recalls that conciliation proceedings before
the Lupon resulted in the execution of an Agreement on June 5, 1999. Upon failure
to comply with the agreement, all chances of amicable settlement were effectively
foreclosed. Hence, Pablo and the Heirs of Palanca were estopped from claiming
that she failed to comply with the Local Government Codes requirement of prior
referral of their dispute to the Lupon.
After due proceedings, the CA rendered judgment dismissing the petition
and affirming the RTC decision. Berba moved for a reconsideration of the decision,
which proved futile.

In the instant petition for review on certiorari, the petitioner alleges that:
THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED
WHEN IT FAILED TO CONSIDER THE DECISION OF THIS
HONORABLE COURT IN THE CASE OF DIU VS. COURT OF
APPEALS (251 SCRA 478) AND IN DECLARING THAT THERE
WAS NO SUBSTANTIAL COMPLIANCE WITH THE MANDATE OF
PD 1508 (NOW R.A. 7160) WITH RESPECT TO PRIOR REFERRAL
TO THE BARANGAY COURT, THEREBY DECIDING THE CASE
NOT IN ACCORD WITH LAW AND APPLICABLE DECISIONS OF
THE COURT.[26]
The petitioner avers that she is a sickly widow, in the twilight of her years,
and whose only source of income are the rentals generated from the property,
which she also uses to pay her medical expenses. She avers that the continued
denial of her right to the fruits of the subject property is highly unjust and contrary
to the spirit behind the enactment of Presidential Decree (P.D.) No. 1508.[27]
The petitioner also points out that, for her to pay obeisance to the decision of
the CA, she would have to go through the tedious, not to mention horrendous,
process of going back to square one; that is, referring the dispute to
the barangay which, in all likelihood, would be rendered useless considering that
respondents had already been validly and effectively ejected from the leased
premises. She would then have to go through the rungs of the judicial ladder a
second time to vindicate her trampled rights. She further claims that the CAs
affirmation of the RTC decision is equivalent to sanctioning a legal anomaly.
She points out that the very purpose of barangay conciliation is to abbreviate
disputes between members of the same or adjacent barangays to the end that their
disputes will not reach the doors of the courts. Clearly, it does not contemplate a
protracted process as suggested by the RTC ruling and affirmed by the CA.[28]

In their comment on the petition, the respondents aver that the petitioner was
estopped from relying on the June 5, 1999 Agreement between her and respondent
Josephine Pablo before the Lupon because the respondent Heirs of Carlos Palanca
were not parties thereto. The respondents maintained that the petitioner must bear
the blame for her failure to comply with the Local Government Code. At first, she
insisted that there was no need for prior referral of the dispute to
the Lupon, claiming that she resided in abarangay other than where the
respondents resided. Thereafter, she made a volte face and invoked the June 5,
1999 Agreement between her and respondent Josephine Pablo. Moreover, the
respondents aver, the MTC had no jurisdiction over the petitioners action for
unlawful detainer because it was filed only on June 21, 2001, or more than one
year from June 5, 1999 when the petitioner and respondent Josephine Pablo
executed the agreement. As such, the action should be one for recovery of
possession of property (accion publiciana).
On June 2, 2004, the Court resolved to give due course to the petition and
required the parties to file their respective memoranda.[29] The parties complied.
The Court rules that the CA cannot be faulted for affirming the decision of
the RTC reversing the decision of the MTC and ordering the dismissal of the
complaint for unlawful detainer without prejudice.

The records show that petitioner and respondent Josephine Pablo executed
an Agreement on June 5, 1999, which was approved by the Lupon. Respondent
Josephine Pablo did not repudiate the agreement; hence, such agreement of the
parties settling the case had the force and effect of a final judgment. As the Court
declared in Vidal v. Escueta,[30] the settlement of the parties may be enforced by
the Lupon, through the punong barangay, within six months; and if the settlement
is not enforced after the lapse of said period, it may be enforced by an action in the
proper city or municipal court, as provided in Section 417 of the Local
Government Code:
We also agree that the Secretary of the Lupon is mandated to
transmit the settlement to the appropriate city or municipal court within
the time frame under Section 418 of the LGC and to furnish the parties
and the Lupon Chairman with copies thereof. The amicable settlement
which is not repudiated within the period therefor may be enforced by
execution by the Luponthrough the Punong Barangay within a time line
of six months, and if the settlement is not so enforced by the Lupon after
the lapse of said period, it may be enforced only by an action in the
proper city or municipal court as provided for in Section 417 of the LGC
of 1991, as amended, which reads:
SEC. 417. Execution. The amicable settlement or arbitration award
may be enforced by execution by the Lupon within six (6) months from the date
of the settlement. After the lapse of such time, the settlement may be enforced
by action in the proper city or municipal court. (Italics supplied).

Section 417 of the Local Government Code provides a mechanism

for the enforcement of a settlement of the parties before the Lupon. It
provides for a two-tiered mode of enforcement of an amicable settlement
executed by the parties before the Lupon, namely, (a) by execution of
the Punong Barangay which is quasi-judicial and summary in nature on
mere motion of the party/parties entitled thereto; and (b) by an action in
regular form, which remedy is judicial. Under the first remedy, the
proceedings are covered by the LGC and the Katarungang
Pambarangay Implementing Rules and Regulations. The Punong
Barangay is called upon during the hearing to determine solely the fact
of non-compliance of the terms of the settlement and to give the
defaulting party another chance at voluntarily complying with his

obligation under the settlement. Under the second remedy, the

proceedings are governed by the Rules of Court, as amended. The cause
of action is the amicable settlement itself, which, by operation of law,
has the force and effect of a final judgment.
Section 417 of the LGC grants a period of six months to enforce
the amicable settlement by the Lupon through the Punong
Barangay before such party may resort to filing an action with the MTC
to enforce the settlement. The raison detre of the law is to afford the
parties during the six-month time line, a simple, speedy and less
expensive enforcement of their settlement before the Lupon.[31]

In the present case, respondent Josephine Pablo failed to comply with her
obligation of repaying the back rentals of P81,818.00 and the current rentals for the
house. Hence, the petitioner had the right to enforce the Agreement against her
and move for her eviction from the premises. However, instead of filing a motion
before the Lupon for the enforcement of the agreement, or (after six months), an
action in the Metropolitan Trial Court (MTC) for the enforcement of the
settlement, the petitioner filed an action against respondent Josephine Pablo for
unlawful detainer and the collection of unpaid rentals, inclusive of those already
due before the June 5, 1999 Agreement was executed. The action of the petitioner
against respondent Pablo was barred by the Agreement of June 5, 1999.
The Court notes that the petitioner even submitted with the MTC a copy of
her June 5, 1999 Agreement with respondent Josephine Pablo. Instead of
dismissing the complaint as against such respondent, the MTC rendered judgment
against her and ordered her eviction from the leased premises.
The Court thus rules that the petitioners complaint against respondent Heirs
of Carlos Palanca was premature. It bears stressing that they were not impleaded
by the petitioner as parties-respondents before the Lupon. The petitioner filed her

complaint solely against respondent Josephine Pablo.

Moreover, the said

respondent heirs were not privy to the said agreement, and, as such, were not
bound by it. Section 412 of the Local Government Code, sets forth the
precondition to filing of complaints in court, to wit:
SEC. 412 Conciliation.- (a) Pre-condition to filing of complaint in
court. No complaint, petition, action, or proceeding involving any
matter within the authority of the lupon shall be filed or instituted
directly in court or any other government office for adjudication, unless
there has been a confrontation between the parties before
the lupon chairman or the pangkat, and that no conciliation or settlement
has been reached as certified by the lupon secretary or pangkat secretary
as attested to by the lupon chairman or pangkat chairman or unless the
settlement has been repudiated by the parties thereto.
(b) Where parties may go directly to court. The parties may go
directly to court in the following instances:
(1) Where the accused is under detention;
(2) Where a person has otherwise been deprived of personal
liberty calling for habeas corpus proceedings;
(3) Where actions are coupled with provisional remedies such as
preliminary injunction, attachment, delivery of personal property, and
support pendente lite; and
(4) Where the action may otherwise be barred by the statute of
limitations.
(c) Conciliation among members of indigenous cultural
communities. The customs and traditions of indigenous cultural
communities shall be applied in settling disputes between members of
the cultural communities.

Under Sec. 408 of the same Code, parties actually residing in the same city
or municipality

are bound to submit

their

disputes to the Lupon for

conciliation/amicable settlement, unless otherwise provided therein:

SEC. 408. Subject Matter for Amicable Settlement; Exception
Thereto. The lupon of each barangay shall have authority to bring
together the parties actually residing in the same city or municipality for
amicable settlement of all disputes except:
(a) Where one party is the government or any subdivision or
instrumentality thereof;
(b) Where one party is a public officer or employee, and the
dispute relates to the performance of his official functions;
(c) Offenses punishable by imprisonment exceeding one (1) year
or a fine exceeding Five Thousand pesos (P5,000.00);
(d) Offenses where there is no private offended party;
(e) Where the dispute involves real properties located in different
cities or municipalities unless the parties thereto agree to submit their
differences to amicable settlement by an appropriate lupon;
(f)
Disputes involving parties who actually reside
in barangays of different cities or municipalities, except where
such barangay units adjoin each other and the parties thereto agree to
submit their differences to amicable settlement by an appropriate lupon;
(g) Such other classes of disputes which the President may
determine in the interest of justice or upon the recommendation of the
Secretary of Justice.
The court in which non-criminal cases not falling within the
authority of the lupon under this Code are filed may, at any time before
trial, motu proprio refer the case to the luponconcerned for amicable
settlement.

If the complainant/plaintiff fails to comply with the requirements of the

Local Government Code, such complaint filed with the court may be dismissed for
failure to exhaust all administrative remedies.[32]
The petitioners reliance on the ruling of this Court in Diu v. Court of
Appeals[33] is misplaced. In that case, there was a confrontation by the parties
before the BarangayChairman and no agreement was reached.

Although

no pangkat was formed, the Court held in that instance that there was substantial
compliance with the law. In any event, the issue in that case was whether the
failure

to

specifically

allege

that

there

was

no

compliance

with

the barangay conciliation procedure constitutes a waiver of that defense.

Moreover, no such confrontation before the Lupon occurred with respect to the
unlawful detainer suit against Josephine Pablo before the MTC.[34]

In this case, the petitioner and the respondent Heirs of Carlos Palanca
resided in the City of Manila, albeit in different barangays. The dispute between
the petitioner and the respondent heirs was thus a matter within the authority of
the Lupon. Hence, the petitioners complaint for unlawful detainer and the
collection of back rentals should have been first filed before the Lupon for
mandatory conciliation, to afford the parties an opportunity to settle the case
amicably. However, the petitioner filed her complaint against the respondent Heirs
of Carlos Palanca directly with the MTC. Clearly then, her complaint was
premature. The execution of the June 5, 1999 Agreement between petitioner and
respondent Josephine Pablo does not amount to substantial compliance to the
requirements of the Local Government Code on mandatory barangay conciliation
proceedings.
Indeed, considering that the MTC had already rendered a decision on the
merits of the case, it is not without reluctance that the Court reaches this
conclusion which would require the petitioner to start again from the beginning.
The facts of the present case, however, do not leave us any choice. To grant the
petition under these circumstances would amount to refusal to give effect to the
Local Government Code and to wiping it off the statute books insofar as ejectment
and other cases governed by the Rule on Summary Procedure are concerned. This
Court has no authority to do that.[35]
IN LIGHT OF ALL THE FOREGOING, the Petition is DENIED.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 146195

November 18, 2004

AVELINA ZAMORA, EMERITA ZAMORA-NICOL, SONNY NICOL, TERESA ZAMORA-UMALI,

CLARENCE UMALI, ROBERTO ZAMORA, ROLANDO ZAMORA, MARY ANN ZAMORA,
MICHELLE ZAMORA and RODRIGO ZAMORA, petitioners,
vs.
HEIRS of CARMEN IZQUIERDO, represented by their attorney-in-fact, ANITA F.
PUNZALAN, respondents.

DECISION

SANDOVAL-GUTIERREZ, J.:
Before us is a petition for review on certiorari1 assailing the Decision2 of the Court of Appeals dated
September 12, 2000 and its Resolution dated December 1, 2000 in CA-G.R. SP No. 54541, entitled
"Avelina Zamora, et al., petitioners, versus Heirs of Carmen Izquierdo, represented by the executrix,
Anita F. Punzalan, respondents."
The records show that sometime in 1973, Carmen Izquierdo and Pablo Zamora entered into a verbal
stipulation whereby the former leased to the latter one of her apartment units located at 117-B
General Luna Street, Caloocan City. They agreed on the following: the rental is P3,000.00 per
month; the leased premises is only for residence; and only a single family is allowed to occupy it.
After the death of Carmen (lessor) in 1996 her attorney-in-fact, Anita Punzalan, representing the
heirs, herein respondents, prepared a new contract of lease wherein the rental was increased from
P3,000.00 to P3,600.00 per month.3 However, petitioners refused to sign it.

In January 1997, Pablo (lessee) died. His wife, Avelina Zamora, and their children (two of whom
have their own families), herein petitioners, continued to reside in the apartment unit. However, they
refused to pay the increased rental and persisted in operating a photocopying business in the same
apartment.
Meanwhile, petitioner Avelina Zamora applied with the Metropolitan Waterworks & Sewerage System
(MWSS) for a water line installation in the premises. Since a written consent from the owner is
required for such installation, she requested respondents' attorney-in-fact to issue it. However, the
latter declined because petitioners refused to pay the new rental rate and violated the restrictions on
the use of the premises by using a portion thereof for photocopying business and allowing three
families to reside therein.
This prompted petitioner Avelina Zamora to file with the Office of the Punong Barangay of Barangay
16, Sona 2, District I, Lungsod ng Caloocan, a complaint against Anita Punzalan (respondents'
attorney-in-fact), docketed as "Usaping Bgy. Blg. 1-27-97, Ukol sa: Hindi Pagbibigay ng Pahintulot
sa Pagpapakabit ng Tubig."
On August 24, 1997, during the barangay conciliation proceedings, petitioner Avelina Zamora
declared that she refused to sign the new lease contract because she is not agreeable with the
conditions specified therein.
The following day, Anita Punzalan sent Avelina a letter 4 informing her that the lease is being
terminated and demanding that petitioners vacate the premises within 30 days from notice.
Despite several barangay conciliation sessions, the parties failed to settle their dispute amicably.
Hence, the Barangay Chairman issued a Certification to File Action dated September 14, 1997. 5
Consequently, on October 2, 1997, respondents, represented by Anita Punzalan, filed with the
Metropolitan Trial Court (MTC), Branch 49, Caloocan City, a complaint for unlawful detainer and
damages against petitioners, docketed as Civil Case No. 23702. 6 Forthwith, petitioners filed a motion
to dismiss7 the complaint on the ground that the controversy was not referred to the barangay for
conciliation. First, they alleged that the barangay Certification to File Action "is fatally defective"
because it pertains to another dispute, i.e., the refusal by respondents' attorney-in-fact to give her
written consent to petitioners' request for installation of water facilities in the premises. And, second,
when the parties failed to reach an amicable settlement before the Lupong Tagapamayapa, the
Punong Barangay (as Lupon Chairman), did not constitute the Pangkat ng Tagapagkasundo before
whom mediation or arbitration proceedings should have been conducted, in violation of Section
410(b), Chapter 7 (Katarungang Pambarangay), Title One, Book III of Republic Act No.
71608 (otherwise known as the Local Government Code of 1991), which reads:
"SECTION 410. Procedure for Amicable Settlement.
(a) x x x
(b) Mediation by lupon chairman Upon receipt of the complaint, the lupon chairman 9 shall,
within the next working day, summon the respondent(s), with notice to the complainant(s) for
them and their witnesses to appear before him for a mediation of their conflicting interests. If
he fails in his mediation effort within fifteen (15) days from the first meeting of the parties
before him, he shall forthwith set a date for the constitution of the pangkat in accordance with
the provisions of this Chapter." (Underscoring supplied)

Respondents opposed the motion to dismiss,10 the same being prohibited under Section 19 of the
1991 Revised Rule on Summary Procedure. They prayed that judgment be rendered as may be
warranted by the facts alleged in the complaint, pursuant to Section 611 of the same Rule.
On July 9, 1998, the MTC issued an Order12 denying petitioners' motion to dismiss and considering
the case submitted for decision in view of their failure to file their answer to the complaint.
Petitioners filed a motion for reconsideration,13 contending that a motion to dismiss the complaint on
the ground of failure to refer the complaint to the Lupon for conciliation is allowed under Section 19
of the 1991 Revised Rule on Summary Procedure, which partly provides:
"SEC. 19. Prohibited pleadings and motions. The following pleadings, motions, or petitions
shall not be allowed in the cases covered by this Rule:
(a) Motion to dismiss the complaint or to quash the complaint or information except on the
ground of lack of jurisdiction over the subject matter, or failure to comply with the preceding
section [referring to Section 18 on referral of the complaint to the Lupon for conciliation];
x x x."
On August 26, 1998, the MTC rendered a Judgment14 in favor of respondents and against
petitioners, the dispositive portion of which reads:
"WHEREFORE, Judgment is hereby rendered in favor of the plaintiff and against the
defendants, ordering defendants and all persons claiming right under them:
1) To vacate the leased premises located at No. 117-B General Luna Street,
Caloocan City and to surrender possession thereof to the plaintiff;
2) To pay the amount of three thousand six hundred (P3,600.00) pesos per month
starting January, 1997 until the premises being occupied by them is finally vacated
and possession thereof is restored to the plaintiff;
3) To pay plaintiff the sum of five thousand (P5,000.00) pesos as and for attorney's
fees; and
4) To pay the costs of this suit.
SO ORDERED."
On appeal, the Regional Trial Court (RTC), Branch 125, Caloocan City, rendered its Decision 15 dated
February 15, 1999 affirming the MTC Judgment. Subsequently, it denied petitioners' motion for
reconsideration.16
Petitioners then filed with the Court of Appeals a petition for review, docketed as CA-G.R. SP No.
54541. On September 12, 2000, it rendered a Decision 17 affirming the RTC Decision.
Thereafter, petitioners filed a motion for reconsideration but was denied by the Appellate Court in its
Resolution dated December 1, 2000.18
Hence, the instant petition.

I
The primordial objective of Presidential Decree No. 1508 (the Katarungang Pambarangay Law), now
included under R.A. No. 7160 (the Local Government Code of 1991), is to reduce the number of
court litigations and prevent the deterioration of the quality of justice which has been brought about
by the indiscriminate filing of cases in the courts.19 To attain this objective, Section 412(a) of R.A. No.
7160 requires the parties to undergo a conciliation process before the Lupon Chairman or the
Pangkat as a precondition to filing a complaint in court, thus:
"SECTION 412. Conciliation. (a) Pre-condition to Filing of Complaint in Court. No
complaint, petition, action, or proceeding involving any matter within the authority of the
lupon shall be filed or instituted directly in court or any other government office for
adjudication, unless there has been a confrontation between the parties before the lupon
chairman or the pangkat, and that no conciliation or settlement has been reached as certified
by the lupon or pangkat secretary and attested to by the lupon or pangkat chairman x x x."
(Underscoring supplied)
In the case at bar, the Punong Barangay, as Chairman of the Lupong Tagapamayapa, conducted
conciliation proceedings to resolve the dispute between the parties herein. Contrary to petitioners'
contention, the complaint does not only allege, as a cause of action, the refusal of respondents'
attorney-in-fact to give her consent to the installation of water facilities in the premises, but also
petitioners' violation of the terms of the lease, specifically their use of a portion therein for their
photocopying business and their failure to pay the increased rental. As correctly found by the RTC:
"The records show that confrontations before the barangay chairman were held on January
26, 1997, February 9, 1997, February 23, 1997, February 28, 1997, July 27, 1997, August 3,
1997, August 10, 1997, August 17, 1997 and August 24, 1997 wherein not only the issue of
water installation was discussed but also the terms of the lease and the proposed execution
of a written contract relative thereto. It appears, however, that no settlement was reached
despite a total of nine meetings at the barangay level.
It is of no moment that the complaint was initially made by defendant-appellant Avelina
Zamora because herein plaintiff-appellee was given by the Sangguniang Barangay the
authority to bring her grievance to the Court for resolution. While it is true that the
Sertifikasyon dated September 14, 1997 is entitled 'Ukol Sa Hindi Pagbibigay Ng Pahintulot
Sa Pagpapakabit Ng Tubig', this title must not prevail over the actual issues discussed in the
proceedings.
Hence, to require another confrontation at the barangay level as a sine qua non for the filing
of the instant case would not serve any useful purpose anymore since no new issues would
be raised therein and the parties have proven so many times in the past that they cannot get
to settle their differences amicably."20
We cannot sustain petitioners' contention that the Lupon conciliation alone, without the proceeding
before the Pangkat ng Tagapagkasundo, contravenes the law on Katarungang Pambarangay.
Section 412(a) of R.A. No. 7160, quoted earlier, clearly provides that, as a precondition to filing a
complaint in court, the parties shall go through the conciliation process either before the Lupon
Chairman (as what happened in the present case), or the Pangkat.
Moreover, in Diu vs. Court of Appeals,21 we held that "notwithstanding the mandate in Section 410(b)
of R.A. No. 7160 that the Barangay Chairman shall constitute a Pangkat if he fails in his mediation
efforts," the same "Section 410(b) should be construed together with Section 412(a) of the same law

(quoted earlier), as well as the circumstances obtaining in and peculiar to the case." Here, while the
Pangkat was not constituted, however, the parties met nine (9) times at the Office of the Barangay
Chairman for conciliation wherein not only the issue of water installation was discussed but also
petitioners' violation of the lease contract. It is thus manifest that there was substantial compliance
with the law which does not require strict adherence thereto. 22
II
We hold that petitioners' motion to dismiss the complaint for unlawful detainer is proscribed by
Section 19(a) of the 1991 Revised Rule on Summary Procedure, quoted earlier. Section 19(a)
permits the filing of such pleading only when the ground for dismissal of the complaint is anchored
on lack of jurisdiction over the subject matter, or failure by the complainant to refer the subject matter
of his/her complaint "to the Lupon for conciliation" prior to its filing with the court. This is clear from
the provisions of Section 18 of the same Rule, which reads:
"SEC. 18. Referral to Lupon. Cases requiring referral to the Lupon for conciliation under
the provisions of Presidential Decree No. 1508 where there is no showing of compliance with
such requirement, shall be dismissed without prejudice, and may be revived only after such
requirement shall have been complied with. This provision shall not apply to criminal cases
where the accused was arrested without a warrant." (Underscoring supplied)
As discussed earlier, the case was referred to the Lupon Chairman for conciliation. Obviously,
petitioners' motion to dismiss, even if allowed, is bereft of merit.
WHEREFORE, the petition is DENIED. The assailed Decision and Resolution of the Court of
Appeals in CA-G.R. SP No. 54541 sustaining the Decision of the RTC which upheld the MTC
Judgment is AFFIRMED.
Costs against petitioners.
SO ORDERED.
Panganiban, (Chairman), Carpio-Morales, and Garcia, JJ., concur.
Corona, J., on leave.

THIRD DIVISION
DANTE M. PASCUAL,
represented by REYMEL
R. SAGARIO,
Petitioner,

-versus-

G.R. No. 157830

Present:
PANGANIBAN, Chairman,
SANDOVAL- GUTIERREZ,*
CORONA,
CARPIO MORALES, and
GARCIA, JJ.
Promulgated:

MARILOU M. PASCUAL,
Respondent.

November 17, 2005

x-------------------------------------------------- ---------------x

DECISION
CARPIO MORALES, J.:

On challenge via Petition for Review on Certiorari is the February 10, 2003
Order of the Regional Trial Court (RTC) of Isabela, Branch 23 at Roxas
dismissing, on motion of herein respondent Marilou M. Pascual, the complaint
filed against her by her brother-herein petitioner Dante M. Pascual, represented by
his attorney-in-fact Reymel R. Sagario (Sagario), for non-compliance with the
conciliation provision-pre condition to filing of complaint in court under R.A. 7160
(the Local Government Code).

Petitioner, a permanent resident of the United States of America, appointed

Sagario as his attorney-in-fact by a Special Power of Attorney (SPA) dated April
10, 2002:
1. To file a case for the cancellation of Transfer Certificate of Title No. T271656 issued in the name of Marilou M. Pascual as well as the Deed of Sale of
Registered Land (Dec. No. 639; Page No. 52; Book No. XXI; Series of 1994)
and/or Reconveyance at the appropriate court;
2. To collect the monthly rentals from the tenant;
3. To enter into amicable settlement with Marilou M. Pascual or any other
mode of payment/and/or dispute resolution;
4. To execute and sign any and all papers, contracts/documents which
may be necessary relative to the above acts.
x x x[1]

Pursuant to the SPA, Sagario filed on October 14, 2002 before the Isabela
RTC at Roxas a complaint entitled Dante M. Pascual, plaintiff v. Marilou M.
Pascual and Register of Deeds, Defendants, docketed as Civil Case No. Br. 23713-02, for Annulment of Transfer Certificate of Title No. T-271657 of Isabela and
Deed of Absolute Sale of Registered Land and/or Reconveyance with Damages.[2]
To the Complaint the defendant-herein respondent Marilou M. Pascual filed
a Motion to Dismiss[3] on two grounds one of which was non-compliance with the
requirement under Section 412 of the Local Government Code, [4] she contending
that there is no showing that the dispute was referred to the barangay court before
the case was filed in court.
By the assailed Order of February 10, 2003,[5] Branch 23 of the Isabela RTC
at Roxas granted respondents Motion to Dismiss in this wise:
. . . RA 7160 repealing P.D. 1508 otherwise known as the Revised Katarungang
Pambarangay provides under Section 409 All disputes involving real property or
any interest therein shall be brought in the barangay where the real property or the

larger portion thereof is situated. Hence, the reliance of the plaintiff on Section
408 of R.A. 7160 is incorrect. When real property or any interest therein is
involved, the dispute shall be filed before the barangay where the property is
located, regardless of the residence of the parties. Besides, it is incorrect to say
that the parties are not residents of the same place, Vira, Roxas, Isabela. The
Attorney-in-fact of the plaintiff in the person of Reymel R. Sagario is a
resident of Vira, Roxas, Isabela, and he substitute(sic) Dante Pascual by
virtue of said Special Power of Attorney. Hence, said Attorney-in-fact should
have brought the dispute before barangay Vira, Roxas, Isabela, where the property
is located. In the case of Royales vs. Intermediate Appellate Court 127 SCRA
470, Ordinarily, non-compliance with the condition precedent prescribed by P.D.
1508 could affect the sufficiency of the plaintiffs cause of action and make his
complaint vulnerable to dismissal on ground of lack of cause of action or
prematurity.[6] (Emphasis and underscoring supplied)

Petitioners Motion for Reconsideration[7] of the above-said order was denied

by Order of March 24, 2003:[8]
xxx
Consequently, the Court is [of] the opinion that the said Attorney-in-fact
shall be deemed to be the real party in interest, reading from the tenor of the
provisions of the Special Power of Attorney. Being a real party in interest, the
Attorney-in-fact is therefore obliged to bring this case first before the Barangay
Court. Sec. 3, Rule 3 of the Rules of Court provides that Where the action is
allowed to be prosecuted or defended by a representative or someone acting in a
fiduciary capacity, the beneficiary shall be included in the title of the case and
shall be deemed to be the real party in interest.
xxx
Being the real party in interest, the Attorney-in-fact may therefore bring
the necessary complaint before the Lupon Tagapayapa and appear in person as if
he is the owner of the land.[9] (Emphasis and underscoring supplied)

Hence, the present petition questioning the palpable legal errors of the
RTC.

Petitioner argues that since he, not his attorney-in-fact Sagario, is the real
party in interest, and since he actually resides abroad, the lupon would have no
jurisdiction to pass upon the dispute involving real property, he citing Agbayani v.
Belen.[10]
Respondent submits, on the other hand, that Section 408, paragraph (f), of
the Local Government Code, is qualified by paragraph (c) of Section 409 of the
same Code the latter of which provides that [a]ll disputes involving real property
or any interest therein shall be brought in the barangay where the real property is
located, hence, the use of the word shall makes it mandatory for the bringing of
the dispute before the lupon.
That attorney-in-fact Sagario is a resident of the same barangay as that of
hers, respondent argues in any event, brings the matter under the jurisdiction of
the lupon, for Sagario, following Section 3 of Rule 3 of the 1997 Rules of Civil
Procedure which provides:
Sec. 3. Representative as parties. - Where the action is allowed to be
prosecuted or defended by a representative or someone acting in a fiduciary
capacity, the beneficiary shall be included in the title of the case and shall be
deemed to be the real party in interest. A representative may be a trustee of an
express trust, a guardian, an executor or administrator, or a party authorized by
law or these Rules. An agent acting in his own name for the benefit of an
undisclosed principal may sue or be sued without joining the principal except
when the contract involves things belonging to the principal,

being a substitute, becomes the real party-in-interest.

Respondents submissions do not lie.
The pertinent provisions of the Local Government Code read:
SEC. 408. Subject Matter for Amicable Settlement; Exception Thereto.
The lupon of each barangay shall have authority to bring together the

parties actually residing in the same city or municipality for amicable settlement
of all disputes except:
(a) Where one party is the government or any subdivision or
instrumentality thereof;
(b) Where one party is a public officer or employee, and the dispute
relates to the performance of his official functions;
(c) Offenses punishable by imprisonment exceeding one (1) year or a fine
exceeding Five Thousand pesos (P5,000.00);
(d) Offenses where there is no private offended party;
(e) Where the dispute involves real properties located in different cities or
municipalities unless the parties thereto agree to submit their differences to
amicable settlement by an appropriate lupon;
(f) Disputes involving parties who actually reside in barangays of
different cities or municipalities, except where such barangay units adjoin each
other and the parties thereto agree to submit their differences to amicable
settlement by an appropriate lupon; and
(g) Such other classes of disputes which the President may determine in
the interest of justice or upon the recommendation of the Secretary of Justice.
The court in which non-criminal cases not falling within the authority of
the lupon under this Code are filed may, at any time before trial, motu
proprio refer the case to the lupon concerned for amicable settlement. (Emphasis
supplied)
SEC. 409. Venue. (a) Disputes between persons actually residing in
the same barangay shall be brought for amicable settlement before the lupon of
said barangay .
(b) Those involving actual residents of different barangays within the
same city or municipality shall be brought in the barangay where the respondent
or any of the respondents actually resides, at the election of the complainant.
(c) All disputes involving real property or any interest therein shall be
brought in the barangay where the real property or the larger portion thereof is
situated.
(d) Those arising at the workplace where the contending parties are
employed or at the institution where such parties are enrolled for study shall be
brought in the barangay where such workplace or institution is located.

Objections to venue shall be raised in the mediation proceedings before

the punong barangay; otherwise, the same shall be deemed waived. Any legal
question which may confront the punong barangay in resolving objections to
venue herein referred to may be submitted to the Secretary of Justice or his duly
designated representative whose ruling thereon shall be binding. (Emphasis
supplied)

In the 1982 case of Tavora v. Veloso,[11] this Court held that where the parties
are not actual residents in the same city or municipality or adjoining barangays,
there is no requirement for them to submit their dispute to the lupon as provided
for in Section 6 vis a vis Sections 2 and 3 of P.D. 1508 (Katarungang
Pambarangay Law).
[B]y express statutory inclusion and exclusion, the Lupon shall have no
jurisdiction over disputes where the parties are not actual residents of the same
city or municipality, except where the barangays in which they actually reside
adjoin each other. (Underscoring supplied)

In the 2000 case of Vercide v. Hernandez,[12] this Court, noting that

the Tavora ruling, reiterated in other cases including the 1996 case
of Agbayani[13] cited by petitioner, was decided under the provisions of P.D. No.
1508 (Katarungang Pambarangay) Law which were, except for some
modifications, echoed in Sections 408-409 of the Local Government Code which
took effect on January 1, 1992, held that the Tavora ruling remained.
To construe the express statutory requirement of actual residency as
applicable to the attorney-in-fact of the party-plaintiff, as contended by respondent,
would abrogate the meaning of a real party in interest as defined in Section 2 of
Rule 3[14] of the 1997 Rules of Court vis a vis Section 3 of the same Rule which
was earlier quoted but misread and misunderstood by respondent.

In fine, since the plaintiff-herein petitioner, the real party in interest, is not
an actual resident of the barangay where the defendant-herein respondent resides,
the locallupon has no jurisdiction over their dispute, hence, prior referral to it for
conciliation is not a pre-condition to its filing in court.
The RTC thus erred in dismissing petitioners complaint.
WHEREFORE, the petition is granted. The assailed February 10, 2003
Order, as well as the March 24, 2003 Order denying reconsideration of the first, of
Branch 23 of the Regional Trial Court of Isabela at Roxas is SET ASIDE. Said
court is accordingly directed to reinstate Civil Case No. 23-713-02 to its docket
and take appropriate action thereon with dispatch.
SO ORDERED.

SECOND DIVISION
[G.R. No. L-63277. November 29, 1983.]
PETRA VDA. DE BORROMEO, Petitioner, v. HON. JULIAN B. POGOY, Municipality/City Trial Court
of Cebu City, and ATTY. RICARDO REYES, Respondents.
Antonio T. Uy for Petitioner.
Numeriano G. Estenzo for Respondents.

SYLLABUS

1. CIVIL LAW; ACTIONS FOR FORCIBLE ENTRY AND DETAINER; PRESCRIPTIVE PERIOD; ACTION NOT
BARRED IN THE CASE AT BAR. Under Article 1147 of the Civil Code, the period for filing actions for
forcible entry and detainer is one year, and this period is counted from demand to vacate the premises.
(Desbarat v. Vda. de Laureano, 18 SCRA 116, Calubayan v. Pascual, 21 SCRA 146, Development Bank of the
Philippines v. Canonoy, 35 SCRA 197) In the case at bar, the letter-demand was dated August 28, 1982,
while the complaint for ejectment was filed in court on September 16, 1982. Between these two dates, less
than a month had elapsed, thereby leaving at least eleven (11) full months of the prescriptive period
provided for in Article 1147 of the Civil Code. Under the procedure outlined in Section 4 of PD 1508, the time
needed for the conciliation proceeding before the Barangay Chairman and the Pangkat should take no more
than 60 days. Giving private respondent nine (9) months-ample time indeed- within which to bring his case
before the proper court should conciliation efforts fail. Thus, it cannot be truthfully asserted, as private
respondent would want Us to believe, that his case would be barred by the Statute of Limitations if he had
to course his action to the Barangay Lupon.
2. REMEDIAL LAW; SECTION 4 (A) OF P.D. No. 1508; CONSTRUED. Under Section 4(a) of PD 1508,
referral of a dispute to the Barangay Lupon is required only where the parties thereto are "individuals." An
"individual" means "a single human being as contrasted with a social group or institution." Obviously, the
law applies only to cases involving natural persons, and not where any of the parties is a juridical person
such as a corporation, partnership, corporation sole, testate or intestate, estate, etc.
3. ID.; JURIDICAL PERSON; REAL PARTY IN INTEREST; REFERRAL TO BARANGAY LUPON, NOT REQUIRED.
In Civil Case No. R-239l5, plaintiff Ricardo Reyes is a mere nominal party who is suing in behalf of the
Intestate Estate of Vito Borromeo. while it is true that Section 3, Rule 3 of the Rules of Court allows the
administrator of an estate to sue or be sued without joining the party for whose benefit the action is
presented or defended, it is indisputable that the real party in interest in Civil Case No. R-23915 is the
intestate estate under administration. Since the said estate is a juridical person (Limjoco v. Intestate of
Fragante, 80 Phil. 776) plaintiff administrator may file the complaint directly in court, without the same
being coursed to the Barangay Lupon for arbitration.

DECISION

ESCOLIN, J.:

Petitioner herein seeks to stop respondent Judge Julian B. Pogoy of the Municipal Trial Court of Cebu City
from taking cognizance of an ejectment suit for failure of the plaintiff to refer the dispute to the Barangay
Lupon for conciliation.
The intestate estate of the late Vito Borromeo is the owner of a building bearing the deceaseds name,
located at F. Ramos St., Cebu City. Said building has been leased and occupied by petitioner Petra Vda. de
Borromeo at a monthly rental of P500.00 payable in advance within the first five days of the month.
On August 28, 1982, private respondent Atty. Ricardo Reyes, administrator of the estate and a resident of
Cebu City, served upon petitioner a letter demanding that she pay the overdue rentals corresponding to the
period from March to September 1982, and thereafter to vacate the premises. As petitioner failed to do so,
Atty. Reyes instituted on September 16, 1982 an ejectment case against the former in the Municipal Trial
Court of Cebu City. The complaint was docketed as Civil Case No. R-23915 and assigned to the sala of
respondent judge.
On November 12, 1982, petitioner moved to dismiss the case, advancing, among others, the want of
jurisdiction of the trial court. Pointing out that the parties are residents of the same city, as alleged in the
complaint, petitioner contended that the court could not exercise jurisdiction over the case for failure of
respondent Atty. Reyes to refer the dispute to the Barangay Court, as required by PD No. 1508, otherwise
known as Katarungang Pambarangay Law.
chanroble svirtualawlibrary

Respondent judge denied the motion to dismiss. He justified the order in this wise:

jgc:chanrobles.com .ph

"The Clerk of Court when this case was filed accepted for filing same. That from the acceptance from (sic)
filing, with the plaintiff having paid the docket fee to show that the case was docketed in the civil division of
this court could be considered as meeting the requirement or precondition for were it not so, the Clerk of
Court would not have accepted the filing of the case especially that there is a standing circular from the
Chief Justice of the Supreme Court without even mentioning the Letter of Instruction of the President of the
Philippines that civil cases and criminal cases with certain exceptions must not be filed without passing the
barangay court." (Order dated December 14, 1982, Annex "c", P. 13, Rollo).
Unable to secure a reconsideration of said order, petitioner came to this Court through this petition
for certiorari. In both his comment and memorandum, private respondent admitted not having availed
himself of the barangay conciliation process, but justified such omission by citing paragraph 4, section 6 of
PD 1508 which allows the direct filing of an action in court where the same may otherwise be barred by the
Statute of Limitations, as applying to the case at bar.
The excuse advanced by private respondent is unsatisfactory. Under Article 1147 of the Civil Code, the
period for filing actions for forcible entry and detainer is one year, 1 and this period is counted from demand
to vacate the premises. 2
In the case at bar, the letter-demand was dated August 28, 1982, while the complaint for ejectment was
filed in court on September 16, 1982. Between these two dates, less than a month had elapsed, thereby
leaving at least eleven (11) full months of the prescriptive period provided for in Article 1147 of the Civil
Code. Under the procedure outlined in Section 4 of PD 1508, 3 the time needed for the conciliation
proceeding before the Barangay Chairman and the Pangkat should take no more than 60 days. Giving
private respondent nine (9) months ample time indeed within which to bring his case before the proper
court should conciliation efforts fail. Thus, it cannot be truthfully asserted, as private respondent would want
Us to believe, that his case would be barred by the Statute of Limitations if he had to course his action to
the Barangay Lupon.
With certain exceptions, PD 1508 makes the conciliation process at the Barangay level a condition precedent
for filing of actions in those instances where said law applies. For this reason, Circular No. 22 addressed to

"ALL JUDGES OF THE COURTS OF FIRST INSTANCE, CIRCUIT CRIMINAL COURTS, JUVENILE AND DOMESTIC
RELATIONS COURT, COURTS OF AGRARIAN RELATIONS, CITY COURTS, MUNICIPAL COURTS AND THEIR
CLERKS OF COURT" was issued by Chief Justice Enrique M. Fernando on November 9, 1979. Said Circular
reads:
chanrobles.com :cralaw:re d

"Effective upon your receipt of the certification by the Minister of Local Government and Community
Development that all the barangays within your respective jurisdictions have organized their Lupons
provided for in Presidential Decree No. 1508, otherwise known as the Katarungang Pambarangay Law, in
implementation of the barangay system of settlement of disputes, you are hereby directed to desist from
receiving complaints, petitions, actions or proceedings in cases falling within the authority of said Lupons."

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library

While respondent acknowledged said Circular in his order of December 14, 1982, he nevertheless chose to
overlook the failure of the complaint in Civil Case No. R-23915 to allege compliance with the requirement of
PD 1508. Neither did he cite any circumstance as would place the suit outside the operation of said law.
Instead, he insisted on relying upon the pro tanto presumption of regularity in the performance by the clerk
of court of his official duty, which to Our mind has been sufficiently overcome by the disclosure by the Clerk
of Court that there was no certification to file action from the Lupon or Pangkat secretary attached to the
complaint. 4
Be that as it may, the instant petition should be dismissed. Under Section 4(a) of PD No. 1508, referral of a
dispute to the Barangay Lupon is required only where the parties thereto are "individuals." An "individual"
means "a single human being as contrasted with a social group or institution." 5 Obviously, the law applies
only to cases involving natural persons, and not where any of the parties is a juridical person such as a
corporation, partnership, corporation sole, testate or intestate, estate, etc.
In Civil Case No. R-23915, plaintiff Ricardo Reyes is a mere nominal party who is suing in behalf of the
Intestate Estate of Vito Borromeo. While it is true that Section 3, Rule 3 of the Rules of Court allows the
administrator of an estate to sue or be sued without joining the party for whose benefit the action is
presented or defended, it is indisputable that the real party in interest in Civil Case No. R-23915 is the
intestate estate under administration. Since the said estate is a juridical person 6 plaintiff administrator may
file the complaint directly in court, without the same being coursed to the Barangay Lupon for arbitration.
ACCORDINGLY, the petition is hereby dismissed. Respondent judge is ordered to try and decide Civil Case
No. R-23915 without unnecessary delay. No costs.
SO ORDERED.
Makasiar (Chairman), Concepcion, Jr., Guerrero, Abad Santos and De Castro, JJ., concur.
Aquino J., concurs in the result.

Republic of the Philippines

Supreme Court
Manila

THIRD DIVISION
ATTY. EVELYN J. MAGNO,
Complainant,

A.C. No. 6296

Present:

- versus -

PANGANIBAN, J., Chairman

SANDOVAL-GUTIERREZ,
CORONA,
CARPIO MORALES and
GARCIA, JJ.

ATTY. OLIVIA VELASCO-JACOBA, Promulgated:

Respondent.
November 22, 2005

x----------------------------------------x

RESOLUTION
GARCIA, J.:
In her sworn complaint, as endorsed by the President of the
Integrated Bar of the Philippines (IBP), Nueva Ecija Chapter, Atty.
Evelyn J. Magno charged Atty. Olivia Velasco-Jacoba, a member of
the same IBP provincial chapter, with willful violation of (a)
Section 415 of the Local Government Code (LGC) of 1991 and (b)
Canon 4 of the Code of Professional Responsibility.

This disciplinary case arose out of a disagreement that

complainant had with her uncle, Lorenzo Inos, over a landscaping
contract they had entered into. In a bid to have the stand-of
between them settled, complainant addressed a letter, styled
Sumbong,[1] to Bonifacio Alcantara, barangay captain of Brgy.
San Pascual, Talavera, Nueva Ecija. At the barangay
conciliation/confrontation proceedings conducted on January 5,
2003, respondent, on the strength of a Special Power of Attorney
signed by Lorenzo Inos, appeared for the latter, accompanied by
his son, Lorenzito. Complainants objection to respondents
appearance elicited the response that Lorenzo Inos is entitled to
be represented by a lawyer inasmuch as complainant is herself a
lawyer. And as to complainants retort that her being a lawyer is
merely coincidental, respondent countered that she is appearing
as an attorney-in-fact, not as counsel, of Lorenzo Inos.

Complainant enumerated specific instances, with supporting

documentation, tending to prove that respondent had, in the

course of the conciliation proceedings before the Punong

Barangay, acted as Inos Lorenzos counsel instead of as his
attorney-in-fact. This is what complainant said in her complaint:
[2]

5. xxx Atty. Olivia Jacoba asked for an ocular

inspection of the subject matter of the complaint. A
heated argument took place because Lorencito Inos said
that [complainants brother] Melencio Magno, Jr. made
alterations in the lagoon . Afterwards Atty. Olivia
Jacoba . . . returned to the barangay hall to have the
incident recorded in the barangay blotter.... attached as
Annex A

6. That on January 12, 2003, Lorenzo Inos

appeared before the hearing also with the assistance of
[respondent]. When the minutes of the proceeding (sic)
was read, [respondent] averred that the minutes is partial
in favor of the complainant because only her statements
were recorded for which reason, marginal insertions were
made to include what [respondent] wanted to be put on
record. She also signed as saksi in the minutes .

7. xxx In a letter (answer to the "sumbong) sent

to the Punong Barangay dated December 22, 2002, she
signed representing herself as Family Legal Counsel of
Inos Family, a copy of the letter is attached as Annex C
. . . . (Words in bracket added.)

In an Order dated February 17, 2003, Atty. Victor C.

Fernandez, IBP Director for Bar Discipline, directed the respondent

to submit, within fifteen (15) days from notice, her answer to the
complaint, otherwise she will be considered as in default. [3]

The case, docketed as CBD No. 03-1061, was assigned to

Commissioner
Rebecca
Villanueva-Maala,
who
admitted
respondents answer notwithstanding her earlier order of July 15,
2003, declaring respondent in default for failure to file an answer
in due time.[4]

In her Answer, respondent alleged that the administrative

complaint
was
filed
with
the
Office
of
the Punong
Barangay, instead of before the Lupong Tagapamayapa, and
heard by Punong Barangay Bonifacio Alcantara alone, instead of
the collegial Lupon or a conciliation panel known as pangkat.
Prescinding from this premise, respondent submits that the
prohibition against a lawyer appearing to assist a client
in katarungan pambarangay proceedings does not apply. Further,
she argued that her appearance was not as a lawyer, but only as
an attorney-in-fact.

In her report dated October 6, 2003, [5] Commissioner Maala

stated that the charge of complainant has been established by
clear preponderance of evidence and, on that basis,
recommended that respondent be suspended from the practice
of her profession for a period of six (6) months. On the other
hand, the Board of Governors, IBP Commission on Bar Discipline,
while agreeing with the inculpatory finding of the investigating
commissioner, recommended in its Resolution No. XVI-2003-235,
[6]
a lighter penalty, to wit:

RESOLVED to ADOPT and APPROVE, as it is hereby

ADOPTED
and
APPROVED,
the
Report
and
Recommendation of the Investigating Commissioner of
the above-entitled case, herein made part of this
Resolution/Decision as Annex "A"; and, finding the
recommendation fully supported by the evidence on
record and the applicable laws and rules, with
modification, and considering respondent's actuations
was in violation of Section 415 which expressly prohibits
the presence and representation by lawyers in the
Katarungan Pambarangay, Atty. Olivia Velasco-Jacoba is
hereby ADMONISHED.

This resolution is now before us for confirmation.

Section 415 of the LGC of 1991[7],

subject Katarungang Pambarangay, provides:

on

the

Section 415. Appearance of Parties in Person. - In

all katarungang pambarangay proceedings, the parties
must appear in person without the assistance of the
counsel or representative, except for minors and
incompetents who may be assisted by their next of kin
who are not lawyers.

The above-quoted provision clearly requires the personal

appearance
of
the
parties
in katarungan
pambarangay conciliation proceedings, unassisted by counsel or
representative. The rationale behind the personal appearance
requirement is to enable the lupon to secure first hand and direct

information about the facts and issues, [8] the exception being in
cases where minors or incompetents are parties. There can be no
quibbling that laymen of goodwill can easily agree to conciliate
and settle their disputes between themselves without what
sometimes is the unsettling assistance of lawyers whose presence
could sometimes obfuscate and confuse issues. [9] Worse still, the
participation of lawyers with their penchant to use their analytical
skills and legal knowledge tend to prolong instead of expedite
settlement of the case.

The prohibition against the presence of a lawyer in a

barangay conciliation proceedings was not, to be sure, lost on
respondent. Her defense that the aforequoted Section 415 of the
LGC does not apply since complainant addressed her Sumbong to
the barangay captain of Brgy. San Pascual who thereafter
proceeded to hear the same is specious at best. In this regard,
suffice it to state that complainant wrote her Sumbong with the
end in view of availing herself of the benefits of barangay justice.
That she addressed her Sumbong to the barangay captain is
really of little moment since the latter chairs the Lupong
Tagapamayapa.[10]

Lest it be overlooked, the prohibition in question applies to

all katarungan barangay proceedings. Section 412(a)[11] the LGC
of 1991 clearly provides that, as a precondition to filing a
complaint in court, the parties shall go through the conciliation
process
either
before
the lupon chairman
or
the lupon or pangkat.
As what happened in this case,
the punong barangay, as chairman of the Lupon Tagapamayapa,
conducted the conciliation proceedings to resolve the disputes
between the two parties.

Given the above perspective, we join the IBP Commission on

Bar Discipline in its determination that respondent transgressed
the prohibition prescribed in Section 415 of the LGC. However, its
recommended penalty of mere admonition must have to be
modified. Doubtless, respondents conduct tended to undermine
the laudable purpose of the katarungan pambarangay system.
What compounded matters was when respondent repeatedly
ignored complainants protestation against her continued
appearance in the barangay conciliation proceedings.

WHEREFORE, Atty. Olivia Velasco-Jacoba is hereby FINED in

the amount of Five Thousand Pesos (P5,000.00) for willful
violation of Section 415 of the Local Government Code of 1991
with WARNING that commission of similar acts of impropriety on
her part in the future will be dealt with more severely.

SO ORDERED.

THIRD DIVISION
MILAGROS G. LUMBUAN,
Petitioner,

- versus -

ALFREDO A. RONQUILLO,
Respondent.

G.R. No. 155713

Present:
QUISUMBING, J., Chairperson,
CARPIO,
CARPIO MORALES,
TINGA, and
VELASCO, JR., JJ.
Promulgated:
May 5, 2006

x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION
QUISUMBING, J.:
This petition for review on certiorari seeks to reverse and set aside
the Decision[1] dated April 12, 2002, of the Court of Appeals in CA-G.R. SP No.
52436 and itsResolution[2] dated October 14, 2002, denying the petitioners motion
for reconsideration.
The salient facts, as found by the Court of Appeals,[3] are as follows:
Petitioner Milagros G. Lumbuan is the registered owner of Lot 19-A, Block
2844 with Transfer Certificate of Title No. 193264, located in Gagalangin,
Tondo, Manila. OnFebruary 20, 1995, she leased it to respondent Alfredo A.
Ronquillo for a period of three years with a monthly rental of P5,000. The parties
also agreed that there will be a 10% annual increase in rent for the succeeding two
years, i.e., 1996 and 1997,[4] and the leased premises will be used exclusively for
the respondents fastfood business, unless any other use is given, with the
petitioners prior written consent.[5]

While the respondent at the start operated a fastfood business, he later used
the premises as residence without the petitioners prior written consent. He also
failed to pay the 10% annual increase in rent of P500/month starting 1996
and P1,000/month in 1997 to the present. Despite repeated verbal and written
demands, the respondent refused to pay the arrears and vacate the leased premises.
On November 15, 1997, the petitioner referred the matter to
the Barangay Chairmans office but the parties failed to arrive at a
settlement. The Barangay Chairman then issued a Certificate to File Action.[6]
On December 8, 1997, the petitioner filed against the respondent an action
for Unlawful Detainer, docketed as Civil Case No. 157922-CV. It was raffled to
the Metropolitan Trial Court (MeTC) of Manila, Branch 6. On December 15,
1997, the respondent received the summons and copy of the
complaint. On December 24, 1997, he filed his Answer by mail. Before
the MeTC could receive the respondents Answer, the petitioner filed a Motion for
Summary Judgment dated January 7, 1998.[7] Acting upon this motion,
the MeTC rendered a decision[8] on January 15, 1998, ordering the respondent to
vacate and surrender possession of the leased premises; to pay the petitioner the
amount of P46,000 as unpaid rentals with legal interest until fully paid; and to pay
the petitioner P5,000 as attorneys fees plus cost of the suit.
The respondent then filed a Manifestation calling the attention of
the MeTC to the fact that his Answer was filed on time and praying that the
decision be set aside. TheMeTC denied the prayer, ruling that the Manifestation
was in the nature of a motion for reconsideration which is a prohibited pleading
under the Rules on Summary Procedure.
Upon appeal, the case was raffled to the Regional Trial Court (RTC)
of Manila, Branch 38, and docketed as Civil Case No. 98-87311. On July 8, 1998,
the RTC rendered its decision[9] setting aside the MeTC decision. The RTC
directed the parties to go back to the Lupon Chairman or Punong Barangay for
further proceedings and to comply strictly with the condition that should the parties
fail to reach an amicable settlement, the entire records of the case will be remanded
to MeTC of Manila, Branch 6, for it to decide the case anew.
The respondent sought reconsideration but the RTC denied the motion in an
Order dated March 15, 1999. Thus, he sought relief from the Court of Appeals
through a petition for review.[10] On April 12, 2002, the appellate court

promulgated a decision, reversing the decision of the RTC and ordering the
dismissal of the ejectment case. The appellate court ruled that when a complaint is
prematurely instituted, as when the mandatory mediation and conciliation in
the barangay level had not been complied with, the court should dismiss the case
and not just remand the records to the court of origin so that the parties may go
through the prerequisite proceedings.
The petitioner filed a motion for reconsideration, which was denied by the
appellate court. Hence, this present petition.
In the meantime, while this petition was pending before this Court, the
parties went through barangay conciliation proceedings as directed by the RTC of
Manila, Branch 38. Again, they failed to arrive at an amicable settlement
prompting the RTC to issue an Order[11] remanding the case to the MeTC of
Manila, Branch 6, where the proceedings took place anew. On April 25, 2000,
the MeTC rendered a second decision, the dispositive portion of which reads:
WHEREFORE, premises considered, judgment on the merits is hereby
rendered for the plaintiff as follows:
1.

Ordering defendant and all persons claiming right of possession

under him to voluntarily vacate the property located at Lot 19-A
Block 2844, Gagalangin, Tondo, Manila and surrender possession
thereof to the plaintiff;

2.

Ordering defendant to pay to plaintiff the amount of P387,512.00

as actual damages in the form of unpaid rentals and its agreed
increase up to January 2000 and to pay the amount of P6,500.00 a
month thereafter until the same is actually vacated;

3.

Ordering the defendant to pay to plaintiff the sum of P10,000.00 as

and for attorneys fees plus cost of the suit.

SO ORDERED.[12]

The respondent appealed the foregoing decision. The case was raffled to RTC
of Manila, Branch 22, and docketed as Civil Case No. 00-98173. The RTC ruled in
favor of the petitioner and dismissed the appeal. The respondent elevated the case to
the Court of Appeals, where it is now pending.
The sole issue for our resolution is:
[WHETHER] THE COURT OF APPEALS GRAVELY ERRED IN DISMISSING
THE COMPLAINT FOR THE ALLEGED FAILURE OF THE PARTIES TO

COMPLY WITH THE MANDATORY MEDIATION AND CONCILIATION

PROCEEDINGS IN THE BARANGAY LEVEL.[13]

With the parties subsequent meeting with the Lupon Chairman

or Punong Barangay for further conciliation proceedings, the procedural defect
was cured. Nevertheless, if only to clear any lingering doubt why the Court of
Appeals erred in dismissing the complaint, we shall delve on the issue.
The
petitioner
alleges
that
the
parties
have
gone
through barangay conciliation proceedings to settle their dispute as shown by
the Certificate to File Action issued by theLupon/Pangkat Secretary and attested by
the Lupon/Pangkat Chairman. The respondent, on the other hand, contends that
whether there was defective compliance or no compliance at all with the required
conciliation, the case should have been dismissed.
The primordial objective of the Katarungang Pambarangay Rules,[14] is to
reduce the number of court litigations and prevent the deterioration of the quality
of justice which has been brought about by the indiscriminate filing of cases in the
courts. To attain this objective, Section 412(a) of Republic Act No.
7160[15] requires the parties to undergo a conciliation process before
the Lupon Chairman or the Pangkat as a precondition to filing a complaint in court,
[16]
thus:
SECTION 412. Conciliation. (a) Pre-condition to Filing of Complaint in
Court. No complaint, petition, action, or proceeding involving any matter within
the authority of the luponshall be filed or instituted directly in court or any other
government office for adjudication, unless there has been a confrontation between
the parties before the lupon chairman or the pangkat, and that no conciliation or
settlement has been reached as certified by
the lupon secretary or pangkat secretary as attested to by
the lupon or pangkat chairman.

Here, the Lupon/Pangkat Chairman and Lupon/Pangkat Secretary signed

the Certificate to File Action stating that no settlement was reached by the
parties. While admittedly no pangkat was constituted, it was not denied that the
parties met at the office of the Barangay Chairman for possible settlement. The
efforts of the BarangayChairman, however, proved futile as no agreement was
reached. Although no pangkat was formed, in our mind, there was substantial
compliance with the law. It is noteworthy that under the aforequoted provision, the

confrontation before the Lupon Chairman or the pangkat is sufficient compliance

with the precondition for filing the case in court. [17] This is true notwithstanding the
mandate of Section 410(b) of the same law that the Barangay Chairman shall
constitute a pangkat if he fails in his mediation efforts. Section 410(b) should be
construed together with Section 412, as well as the circumstances obtaining in and
peculiar to the case. On this score, it is significant that the BarangayChairman
or Punong Barangay is herself the Chairman of the Lupon under the Local
Government Code.[18]
Finally, this Court is aware that the resolution of the substantial issues in this
case is pending with the Court of Appeals. While ordinarily, we would have
determined the validity of the parties substantial claims since to await the
appellate courts decision will only frustrate speedy justice and, in any event,
would be a futile exercise, as in all probability the case would end up with this
Court, we find that we cannot do so in the instant case.
It must be underscored that supervening events have taken place before the
lower courts where the parties have been adequately heard, and all the issues have
been ventilated. Since the records of those proceedings are with the Court of
Appeals, it is in a better position to fully adjudicate the rights of the parties. To
rely on the records before this Court would prevent us from rendering a sound
judgment in this case. Thus, we are left with no alternative but to leave the matter
of ruling on the merits to the appellate court.
WHEREFORE, the petition is GRANTED. The decision and resolution of
the Court of Appeals in CA-G.R. SP No. 52436 are REVERSED and SET
ASIDE, and the decision of the Regional Trial Court of Manila, Branch 38, in
Civil Case No. 98-87311 is AFFIRMED.
The Court of Appeals is ordered to proceed with the appeal in CA G.R.
No. 73453 and decide the case with dispatch.
SO ORDERED.