G.R. No.
141853 February 7, 2001 On March 21, 1997, respondent Gumersindo De Guzman filed an extra judicial foreclosure of the real
TERESITA V. IDOLOR, petitioner,
vs.
HON. COURT OF APPEALS, SPS. GUMERSINDO DE GUZMAN and ILUMINADA DE
GUZMAN and HON. PRUDENCIO A. CASTILLO, JR., Presiding Judge, Regional Trial Court,
National Capital Judicial Region, Branch 220, Quezon City, respondents.
GONZAGA-REYES, J.:
This is a petition for review on certiorari filed by petitioner Teresita Idolor which seeks to set aside the
decision1 of the respondent Court of Appeals which reversed the Order2 of the Regional Trial Court of
Quezon City3 granting Idolor's prayer for the issuance of a writ of preliminary injunction and the resolution
denying petitioner's motion for reconsideration.4
On March 21, 1994, to secure a loan of P520,000.00, petitioner Teresita Idolor executed in favor of private
respondent Gumersindo De Guzman a Deed of Real Estate Mortgage with right of extra-judicial
foreclosure upon failure to redeem the mortgage on or before September 20, 1994. The object of said
mortgage is a 200-square meter property with improvements located at 66 Ilocos Sur Street, Barangay
Ramon Magsaysay, Quezon City covered by TCT No. 25659.
On September 21, 1996, private respondent Iluminada de Guzman, wife of Gumersindo de Guzman, filed a
complaint against petitioner Idolor before the Office of the Barangay Captain of Barangay Ramon
Magsaysay, Quezon City, which resulted in a "Kasunduang Pag-aayos" which agreement is quoted in full5:
"Kami, ang (mga) may sumbong at (mga) ipinagsusumbong sa usaping binabanggit sa itaas, ay
nagkakasundo sa pamamagitan nito na ayusin ang aming alitan gaya ng sumusunod:
Na ako si Teresita V. Idolor of legal age ay nakahiram ng halagang P520,000.00 noong
September 20, 1994.
Na ang nasabing halaga ay may nakasanlang titulo ng lupa (TCT No. 25659) under Registry
receipt 3420 dated July 15, 1996.
Na ako si Teresita V. Idolor ay humihingi ng 90 days palugit (grace period) to settle the said
amount.
Failure to settle the above account on or before December 21, 1996, I agree to execute a deed of
sale with the agreement to repurchase without interest within one year.
Total amount of P1,233,288.23 inclusive of interest earned.
At nangangako kami na tutupad na tunay at matapat sa mga katakdaan ng pag-aayos na inilahad
sa itaas."
Petitioner failed to comply with her undertaking; thus private respondent Gumersindo filed a motion for
execution before the Office of the Barangay captain who subsequently issued a certification to file action.
estate mortgage pursuant to the parties agreement set forth in the real estate mortgage dated March 21,
1994.
On May 23, 1997, the mortgaged property was sold in a public auction to respondent Gumersindo, as the
highest bidder and consequently, the Sheriff's Certificate of Sale was registered with the Registry of Deeds
of Quezon City on June 23, 1997.
On June 25, 1998, petitioner filed with the Regional Trial Court of Quezon City, Branch 220, a complaint
for annulment of Sheriff's Certificate of Sale with prayer for the issuance of a temporary restraining order
(TRO) and a writ of preliminary injunction against private respondents, Deputy Sheriffs Marino Cachero
and Rodolfo Lescano and the Registry of Deeds of Quezon City alleging among others alleged irregularity
and lack of notice in the extra-judicial foreclosure proceedings subject of the real estate mortgage. In the
meantime, a temporary restraining order was issued by the trial court. 1âwphi1.nêt
On July 28, 1998, the trial court issued a writ of preliminary injunction enjoining private respondents, the
Deputy Sheriffs and the Registry of Deeds of Quezon City from causing the issuance of a final deed of sale
and consolidation of ownership of the subject property in favor of the De Guzman spouses. The trial court
denied the motion for reconsideration filed by the de Guzman spouses.
Spouses de Guzman filed with the respondent Court of Appeals a petition for certiorari seeking annulment
of the trial court's order dated July 28, 1998 which granted the issuance of a preliminary injunction.
On September 28, 1999, the respondent court granted the petition and annulled the assailed writ of
preliminary injunction. Teresita Idolor filed her motion for reconsideration which was denied in a
resolution dated February 4, 2000.
Hence this petition for review on certiorari filed by petitioner Teresita V. Idolor. The issues raised by
petitioner are: whether or not the respondent Court of Appeals erred in ruling (1) that petitioner has no
more proprietary right to the issuance of the writ of injunction, (2) that the "Kasunduang Pag-aayos" did
not ipso facto result innovation of the real estate mortgage, (3) that the "Kasunduang Pag-aayos" is merely
a promissory note of petitioner to private respondent spouses; and (4) that the questioned writ of
preliminary injunction was issued with grave abuse of discretion.
The core issue in this petition is whether or not the respondent Court erred in finding that the trial court
committed grave abuse of discretion in enjoining the private and public respondents from causing the
issuance of a final deed of sale and consolidation of ownership of the subject parcel of land in favor of
private respondents.
Petitioner claims that her proprietary right over the subject parcel of land was not yet lost since her right to
redeem the subject land for a period of one year had neither lapsed nor run as the sheriff's certificate of sale
was null and void; that petitioner and the general public have not been validly notified of the auction sale
conducted by respondent sheriffs; that the newspaper utilized in the publication of the notice of sale was
not a newspaper of general circulation.
We do not agree.
Injunction is a preservative remedy aimed at protecting substantive rights and interests.6 Before an
injunction can be issued, it is essential that the following requisites be present: 1) there must be aright in
esse or the existence of a right to be protected; 2) the act against which the injunction is to be directed is a
violation of such right.7 Hence the existence of a right violated, is a prerequisite to the granting of an
injunction. Injunction is not designed to protect contingent or future rights. Failure to establish either the
existence of a clear and positive right which should be judicially protected through the writ of injunction or
that the defendant has committed or has attempted to commit any act which has endangered or tends to
endanger the existence of said right, is a sufficient ground for denying the injunction.8 The controlling
reason for the existence of the judicial power to issue the writ is that the court may thereby prevent a
threatened or continuous irremediable injury to some of the parties before their claims can be thoroughly
investigated and advisedly adjudicated.9 It is to be resorted to only when there is a pressing necessity to
avoid injurious consequences which cannot be remedied under any standard of compensation. 10
In the instant case, we agree with the respondent Court that petitioner has no more proprietary right to
speak of over the foreclosed property to entitle her to the issuance of a writ of injunction. It appears that the
mortgaged property was sold in a public auction to private respondent Gumersindo on May 23, 1997 and
the sheriff's certificate of sale was registered with the Registry of Deeds of Quezon City on June 23, 1997.
Petitioner had one year from the registration of the sheriff's sale to redeem the property but she failed to
exercise her right on or before June 23, 1998, thus spouses de Guzman are now entitled to a conveyance
and possession of the foreclosed property. When petitioner filed her complaint for annulment of sheriff's
sale against private respondents with prayer for the issuance of a writ of preliminary injunction on June 25,
1998, she failed to show sufficient interest or title in the property sought to be protected as her right of
redemption had already expired on June 23, 1998, i.e. two (2) days before the filing of the complaint. It is
always a ground for denying injunction that the party seeking it has insufficient title or interest to sustain it,
and no claim to the ultimate relief sought - in other words, that she shows no equity.11 The possibility of
irreparable damage without proof of actual existing right is not aground for an injunction.12
Petitioner's allegation regarding the invalidity of the sheriff's sale dwells on the merits of the case; We
cannot rule on the same considering that the matter should be resolved during the trial on the merits.
Petitioner next contends that the execution of the "Kasunduang Pag-aayos" dated September 21, 1996
between her and spouses de Guzman before the Office of the Lupon Tagapamayapa showed the express
and unequivocal intention of the parties to novate or modify the real estate mortgage; that a comparison of
the real estate mortgage dated March 21, 1994 and the "Kasunduang Pag-aayos" dated September 21, 1996
revealed the irreconciliable incompatibility between them, i.e., that under the first agreement, the amount
due was five hundred twenty thousand (P520,000) pesos only payable by petitioner within six (6) months,
after which it shall earn interest at the legal rate per annum and non-payment of which within the stipulated
period, private respondents have the right to extra-judicially foreclose the real estate mortgage while under
the second agreement, the amount due was one million two hundred thirty three thousand two hundred
eighty eight and 23/100 (P1,233,288.23) inclusive of interest, payable within 90 days and in. case of non
payment of the same on or before December 21, 1996, petitioner should execute a deed of sale with right to
repurchase within one year without interest; that the second agreement "Kasunduang Pag-aayos" was a
valid new contract as it was duly executed by the parties and it changed the principal conditions of
petitioner's original obligations. Petitioner insists that the "Kasunduang Pag-aayos" was not a mere
promissory note contrary to respondent court's conclusion since it was entered by the parties before the
Lupon Tagapamayapa which has the effect of a final judgment. 13
We are not persuaded.
Novation is the extinguishment of an obligation by the substitution or change of the obligation by a
subsequent one which terminates it, either by changing its objects or principal conditions, or by
substituting a new debtor in place of the old one, or by subrogating a third person to the rights of the
creditor.14 Under the law, novation is never presumed. The parties to a contract must expressly agree that
they are abrogating their old contract in favor of a new one.15 Accordingly, it was held that no novation of
a contract had occurred when the new agreement entered into between the parties was intended to give life
to the old one.16
A review of the "Kasunduang Pag-aayos" which is quoted earlier does not support petitioner's contention
that it novated the real estate mortgage since the will to novate did not appear by express agreement of the
parties nor the old and the new contracts were incompatible in air points. In fact, petitioner expressly
recognized in the Kasunduan the existence and the validity of the old obligation where she acknowledged
her long overdue account since September 20, 1994 which was secured by a real estate mortgage and asked
for a ninety (90) days grace period to settle her obligation on or before December 21, 1996 and that upon
failure to do so, she will execute a deed of sale with a right to repurchase without interest within one year
in favor of private respondents. Where the parties to the new obligation expressly recognize the continuing
existence and validity of the old one, where, in other words, the parties expressly negated the lapsing of the
old obligation, there can be no novation.17 We find no cogent reason to disagree with the respondent court's
pronouncement as follows:
"In the present case. there exists no such express abrogation of the original undertaking. The
agreement adverted to (Annex 2 of Comment, p.75 Rollo) executed by the parties on September
21, 1996 merely gave life to the March 21, 1994 mortgage contract which was then more than
two years overdue. Respondent acknowledged therein her total indebtedness in the sum of
P1,233,288.23 including the interests due on the unpaid mortgage loan which amount she
promised to liquidate within ninety (90) days or until December 21, 1996, failing which she
also agreed to execute in favor of the .mortgagee a deed of sale of the mortgaged property for
the same amount w1thout interest. Evidently, it was executed to facilitate easy compliance by
respondent mortgagor with her mortgage obligation. It (the September 21, 1996 agreement) is
not incompatible and can stand together with the mortgage contract of March 21, 1994.
A compromise agreement clarifying the total sum owned by a buyer with the view that he
would find it easier to comply with his obligations under the Contract to Sell does not novate
said Contract to Sell (Rillo v. Court of Appeals, 274 SCRA 461 [1997]).
Respondent correctly argues that the compromise agreement has the force and effect of a final
judgment. That precisely is the reason why petitioner resorted to the foreclosure of the
mortgage on March 27, 1997, after her failure to comply with her obligation which expired on
December 21, 1996.
Reliance by private respondent upon Section 417 of the New Local Government Code of 1991,
which requires the lapse of six (6) months before the amicable settlement may be, enforced, is
misplaced. The instant case deals with extra judicial foreclosure governed by ACT No. 3135 as
amended."
Notably, the provision in the "Kasunduang Pag-aayos" regarding the execution of a deed of sale with right
to repurchase within one year would have the same effect as the extra-judicial foreclosure of the real estate
mortgage wherein petitioner was given one year from the registration of the sheriff's sale in the Registry of
property to redeem the property, i.e., failure to exercise the right of redemption would entitle the purchaser
to possession of the property. It is not proper to consider an obligation novated by. unimportant
modifications which do not alter its essence.18 It bears stress that the period to pay the total amount of
petitioner's indebtedness inclusive of interest amounted to P1,233,288.23 expired on December 21, 1996
and petitioner failed to execute a deed of sale with right to repurchase on the said date up to the time
private respondents filed their petition for extra-judicial foreclosure of real estate mortgage. The failure of
petitioner to comply with her undertaking in the "kasunduan" to settle her obligation effectively delayed
private respondents' right to extra-judicially foreclose the real estate mortgage which right accrued as far
back as 1994. Thus, petitioner has not shown that she is entitled to the equitable relief of
injunction. 1âwphi1.nêt
WHEREFORE, the petition is DENIED. The decision of the respondent Court of Appeals dated
September 28, 1999 is hereby AFFIRMED. SO ORDERED.
A.M. No. MTJ-00-1250 February 28, 2001
[Formerly OCA IPI No. 97-332-MTJ]
RIMEO S. LO, complainant,
vs.
HON. RICARDO S. REAL, SR., Presiding Judge, 2nd Municipal Circuit Trial Court of Victorias-
Manapla, Negros Occidental, respondent.
QUISUMBING, J.:
In a verified complaint1 dated June 15, 1997, Rimeo S. Gustilo charged respondent Judge Ricardo S. Real,
Sr., of the Municipal Circuit Trial Court of Victorias-Manapla, Negros Occidental with gross misconduct,
gross incompetence, gross ignorance of the law, and violation of the Anti-Graft and Corrupt Practices Act
relative to Civil Case No. 703-M entitled "Weddy C. Libo-on v. Rimeo S. Gustilo, et al. " for recounting of
ballots of Precinct Nos. 27 and 27-A, Barangay Punta Mesa, Manapla, Negros Occidental.
Complainant avers that he was a candidate for punong barangay of Barangay Punta Mesa, Manapla,
Negros Occidental in the May 12, 1997 elections. His lone opponent was Weddy C. Libo-on, then the
incumbent punong barangay and the representative of the Association of Barangay Captains (ABC) to
the Sangguniang Bayan of Manapla and the Sangguniang Panlalawigan of Negros Occidental. Both
complainant and Libo-on garnered eight hundred nineteen (819) votes during the elections, resulting in a
tie. The breaking of the tie by the Board of Canvassers was in complainant's favor and he was proclaimed
duly elected punong barangay of Punta Mesa, Manapla.2
On May 20, 1997, his opponent filed an election protest case, docketed as Civil Case No. 703-M, before
the MCTC of Victorias-Manapla, Negros Occidental. Libo-on sought the recounting of ballots in two
precincts, preliminary prohibitory injunction, and damages.1âwphi1.nêt
On May 21, 1997, respondent ordered the issuance of summons to the parties and set the hearing on June
6, 1997.3
On May 27, 1997, however, Libo-on filed a motion to advance the hearing to May 29 and 30, 1997.
The next day, respondent granted Libo-on's motion. The hearing was advanced to May 29 and 30, 1997
cancelling the hearing for June 6, 1997.4 Complainant avers that he was not furnished a copy of this Order
dated May 28, 1997.
On May 29, 1997, respondent judge issued a temporary restraining order (TRO) and annulled the
proclamation of complainant as the duly elected punong barangay of Punta Mesa, Manapla.5 Complainant
declares that no copy of this Order dated May 29, 1997 was served on him. That same day, however, he
was able to secure copies of the orders of respondent dated May 28 and May 29, 1997 from the
COMELEC Registrar of Manapla, Negros Occidental and the Department of Interior and Local
Government (DILG). Moreover, it was only in the afternoon of May 29, 1997 that complainant received a
copy of Libo-on's petition in Civil Case No. 703-M and respondent's Order dated May 21, 1997.
On May 30, 1997, complainant took his oath of office as punong barangay.6 That same day, he also filed a
petition for certiorari before the Regional Trial Court of Silay City, Negros Occidental, Branch 69
docketed as Special Civil Action No. 1936-69.
On June 5, 1997, the RTC lifted the TRO issued by respondent and declared as null and void the order
nullifying complainant's proclamation as duly elected punong barangay.7
Believing that respondent could not decide Civil Case No. 703-M impartially, complainant moved for his
inhibition.
On June 11, 1997, respondent denied complainant's motion for inhibition and after hearing Libo-on's
motion for permanent injunction, issued a second TRO "to maintain the status quo between the contending
parties."8
Complainant argues that by issuing the second TRO, respondent reversed the order of the RTC of Silay
City dated June 5, 1997. He also claims that by preventing him from assuming office, he was excluded by
the DILG from participating in the election of the Liga ng Mga Barangay on June 14, 1997.
In his Comment, respondent denied the allegations. He claimed that when Libo-on filed his motion to
advance the hearing of the prayer for injunction on May 27, 1997 in Civil Case No. 703-M, complainant
was served a copy by registered mail as shown by the registry receipts attached to said motion.
Considering the urgency of the matter and since there was substantial compliance with due process, he
issued the Order of May 28, 1997 which cancelled the hearing set for June 6, 1997 and advanced it to May
29 and 30, 1997.
Respondent claims that on May 29, 1997, Libo-on and his counsel appeared but complainant did not,
despite due notice. The hearing then proceeded, with Libo-on presenting his evidence. As a result, he
issued the TRO prayed for and annulled complainant's proclamation. Respondent admits that the Order of
May 29, 1997, particularly the annulment of complainant's proclamation, was outside the jurisdiction of his
court. But since the COMELEC ignored Libo-on's petition for correction of erroneous tabulation and Libo-
on had no other remedy under the law, he was constrained to annul complainant's proclamation, which
from the very beginning was illegal. He justified his action by our rulings in Bince, Jr. v. COMELEC, 312
Phil. 316 (1995) and Tatlonghari v. COMELEC, 199 SCRA 849 (1991), which held that a faulty tabulation
cannot be the basis of a valid proclamation.
Respondent also faults the RTC of Silay City for issuing the Order dated June 5, 1997, which lifted the
TRO he issued and declared void his nullification of complainant's proclamation. Respondent contends that
complainant should first have exhausted all remedies in his court before resorting to the special civil action
for certiorari with the RTC. The latter court, in turn, should have dismissed the action for certiorari for
failure to exhaust judicial remedies.
With respect to his Order of June 11, 1997, respondent explains that it was never meant to reverse the
Order of the RTC of Silay City dated June 5, 1997. He points out that both parties in Civil Case No. 703-M
were present during the hearing after due notice. After receiving their evidence, he found that unless a
TRO was issued, Libo-on would suffer a grave injustice and irreparable injury .He submits that absent
fraud, dishonesty, or corruption, his acts, even if erroneous, are not the subject of disciplinary action.
In its evaluation and recommendation report dated November 29, 1999, the Office of the Court
Administrator (OCA) found that respondent's errors were not honest mistakes in the performance of his
duties. Rather, his actions showed a bias in favor of Libo-on and "evinced a pattern to prevent the
complainant from assuming office as the duly elected punong barangay despite his having been
proclaimed as such by the Board of Canvassers." The OCA recommends that respondent be fined
P20,000.00 and warned that a repetition of similar acts in the future will be dealt with more severely.
Supreme Court Administrative Circular No. 20-95 provides:
2. The application for a TRO shall be acted upon only after all parties are heard in a summary
hearingconducted within twenty-four (24) hours after the records are transmitted to the branch
 selected by raffle. The records shall be transmitted immediately after raffle (Emphasis
supplied).
xxx
4. With the exception of the provisions which necessarily involve multiple-sala stations, these
rules shall apply to single-sala stations especially with regard to immediate notice to all parties
of all applications for TRO.
The foregoing clearly show that whenever an application for a TRO is filed, the court may act on the
application only after all parties have been notified and heard in a summary hearing. In other words, a
summary hearing may not be dispensed with.9 In the instant case, respondent admits that he issued the
injunctive writ sought on May 29, 1997 after receiving the applicant's evidence ex parte. His failure to
abide by Administrative Circular No. 20-95 in issuing the first TRO is grave abuse of authority,
misconduct, and conduct prejudicial to the proper administration of justice.
Worse, he compounded the infraction by annulling complainant's proclamation as the duly elected punong
barangay of Punta Mesa, Manapla and prohibiting him from assuming office. Respondent admits that his
court was not vested with the power or jurisdiction to annul the proclamation, but seeks to justify his action
on the ground that the proclamation was void ab initio. In so doing, respondent wantonly usurped a power
exclusively vested by law in the COMELEC.10 A judge is expected to know the jurisdictional boundaries
of courts and quasi-judicial bodies like the COMELEC as mapped out by the Constitution and statutes and
to act only within said limits. A judge who wantonly arrogates unto himself the authority and power vested
in other agencies not only acts in oppressive disregard of the basic requirements of due process, but also
creates chaos and contributes to confusion in the administration of justice. Respondent, in transgressing the
jurisdictional demarcation lines between his court and the COMELEC, clearly failed to realize the position
that his court occupies in the interrelation and operation of the country's justice system. He displayed a
marked ignorance of basic laws and principles. Rule 3.01 of the Code of Judicial Conduct provides that a
"judge shall be faithful to the law and maintain professional competence." By annulling complainant's
proclamation as the duly elected punong barangay, despite being aware of the fact that his court had no
power to do so, not only is respondent guilty of grave' abuse of authority, he also manifests unfaithfulness
to a basic legal rule as well as injudicious conduct.
issuance of a temporary restraining order "to maintain the status quo." We see no reason to disagree with
the finding of the OCA that the evident purpose of the second TRO was to prevent complainant from
participating in the election of the Liga ng mga Barangay. Respondent must be held liable for violating
Rule 3.02 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 interests, public opinion, or
fear of criticism."
In a similar case, a judge was fined P5,000.00 for failure to observe the requirements of Administrative
Circular No. 20-95 when he issued a TRO enjoining a duly proclaimed barangay captain from participating
in the elections of officers of the ABC of Tart, Eastern Samar.13 Note, however, that in the instant case, the
respondent's infractions are not limited to the mere issuance of a restraining order without conducting the
summary conference required by Administrative Circular No. 20-95. He also annulled the proclamation of
the complainant knowing very well that he had no such authority. When his first restraining order was set
aside and nullification of complainant's proclamation was declared null and void by the RTC of Silay City,
a superior court, he again issued a TRO, which showed his partiality to complainant's political rival.
Respondent is thus guilty of violating Rules 3.01 and 3.02 of the Code of Judicial Conduct; knowingly
rendering an unjust order; gross ignorance of the law or procedure; as well as bias and partiality. All of the
foregoing are serious charges under Rule 140, Section 3 of the Rules of Court. We agree with the sanction
recommended by the OCA, finding it to be in accord with Rule 140, Section 10 (A) of the Rules of
Court.1âwphi1.nêt
WHEREFORE, this COURT finds respondent judge GUILTY of violating Rules 3.01 and 3.02 of the
Code of Judicial Conduct, knowingly rendering an unjust order, gross ignorance of the law and procedure,
and bias and partiality. Accordingly, a fine of Twenty Thousand Pesos (P20,000.00) is hereby imposed
upon respondent with a STERN WARNING that a repetition of the same or similar acts will be dealt with
more severely.
SO ORDERED.

Moreover, in willfully nullifying complainant's proclamation despite his court's want of authority,
respondent knowingly issued an unjust order.

Note that the RTC of Silay City corrected respondent's errors by declaring null and void his Order dated
May 29, 1997. Nonetheless, he compounded his previous errors of judgment by proceeding to hear Libo-
on's motion for permanent injunction and issuing a second TRO on June 11, 1997 on the ground that
"extreme urgency" and "grave injustice and irreparable injury will arise" if no injunctive remedy were
granted. Respondent insists that his act did not reverse the Order of the RTC in Special Civil Action
No.1936-69, since the second TRO he issued satisfied the notice and hearing requirements of Circular No.
20-95.

Before an injunctive writ can be issued, it is essential that the following requisites be present: (1) there
must be aright in esse or the existence of a right to be protected; and (2) the act against which injunction to
be directed is a violation of such right.11 The onus probandi is on movant to show that there exists a right
to be protected, which is directly threatened by the act sought to be enjoined. Further, there must be a
showing that the invasion of the right is material and substantial and that there is an urgent and paramount
necessity for the writ to prevent a serious damage.12 In this case, complainant had been duly proclaimed as
the winning candidate for punong barangay. He had taken his oath of office. Unless his election was
annulled, he was entitled to all the rights of said office. We do not see how the complainant's exercise of
such rights would cause an irreparable injury or violate the right of the losing candidate so as to justify the
MICHAEL J. LAGROSAS, G.R. No. 168637 car thrice. Menquito and Lim alighted from the car. Lagrosas approached them and hit Menquito
with a metal steering wheel lock. When Lim tried to intervene, Lagrosas accidentally hit her head.
Petitioner, Present:
Upon learning of the incident, Bristol-Myers required Lagrosas to explain in writing why he should
not be dismissed for assaulting a co-employee outside of business hours. While the offense is not
- versus - Quisumbing, J., Chairperson, covered by the Code of Discipline for Territory Managers, the Code states that "other infractions
not provided for herein shall be penalized in the most appropriate manner at the discretion of
BRISTOL-MYERS SQUIBB (PHIL.), INC./MEAD JOHNSON PHIL., Carpio Morales, management."5 In his memo, Lagrosas admitted that he accidentally hit Lim when she tried to
RICHARD SMYTH as General Manager and FERDIE SARFATI, as intervene. He explained that he did not intend to hit her as shown by the fact that he never left the
Medical Sales Director, hospital until he was assured that she was all right.6
Tinga,

Respondents. In the disciplinary hearing that followed, it was established that Lagrosas and Lim had physical
VELASCO, JR., and confrontations prior to the incident. But Lagrosas denied saying that he might not be able to control
himself and hurt Lim and her boyfriend if he sees them together.
x- - - - - - - - - - - - - - - - - - - - - - - - - -x
BRION, JJ.
BRISTOL-MYERS SQUIBB (PHIL.), G.R. No. 170684 On March 23, 2000, Bristol-Myers dismissed Lagrosas effective immediately.7Lagrosas then filed a
complaint8 for illegal dismissal, non-payment of vacation and sick leave benefits, 13th month pay,
INC./MEAD JOHNSON PHIL., attorney’s fees, damages and fair market value of his Team Share Stock Option Grant.

Petitioner, On February 28, 2002, Labor Arbiter Renaldo O. Hernandez rendered a Decision 9 in NLRC NCR
Case No. 00-03-02821-99, declaring the dismissal illegal. He noted that while Lagrosas committed a
- versus -
misconduct, it was not connected with his work. The incident occurred outside of company premises
and office hours. He also observed that the misconduct was not directed against a co-employee who
COURT OF APPEALS and MICHAEL J. LAGROSAS, Promulgated: just happened to be accidentally hit in the process. Nevertheless, Labor Arbiter Hernandez imposed
a penalty of three months suspension or forfeiture of pay to remind Lagrosas not to be carried away
Respondents. September 12, 2008 by the mindless dictates of his passion. Thus, the Arbiter ruled:

WHEREFORE, premises considered, judgment is hereby [rendered] finding that respondent

x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
company illegally dismissed complainant thus, ORDERING it:

DECISION
QUISUMBING, J.:
Before this Court are two consolidated petitions. The first petition, docketed as G.R. No. 168637,
filed by Michael J. Lagrosas, assails the Decision1 dated January 28, 2005 and the Resolution2 dated
June 23, 2005 of the Court of Appeals in CA-G.R. SP No. 83885. The second petition, docketed as
G.R. No. 170684, filed by Bristol-Myers Squibb (Phil.), Inc./Mead Johnson Phil., assails the
Resolutions3 dated August 12, 2005 and October 28, 2005 of the Court of Appeals in CA-G.R. SP No.
83885.
1) [t]o reinstate him to his former position without loss of seniority rights, privileges and benefits and
to pay him full backwages reckoned from [the] date of his illegal dismissal on 23 March 2000
including the monetary value of his vacation/sick leave of 16 days per year reckoned from July 1,
2000 until actually reinstated, less three (3) months salary as penalty for his infraction;
2) to pay him the monetary equivalent of his accrued and unused combined sick/vacation leaves as of
June 30, 2000 of 16 days x 3 years and 4 months – 10 days x P545.45 = P23,636.16 and the present
fair market value of his Team Share stock option grant for eight hundred (800) BMS common shares
of stock listed in the New York Stock Exchange which vested in complainant as of 01 July 1997,
provisionally computed as 90% (800 shares x US$40.00 per share x P43.20/US$ = P1,244,160.00).

The facts are undisputed. 3) to pay him Attorney’s fee of 10% on the entire computable amount.

Michael J. Lagrosas was employed by Bristol-Myers Squibb (Phil.), Inc./Mead Johnson Phil. from All other claims of complainant are dismissed for lack of merit.
January 6, 1997 until March 23, 2000 as Territory Manager in its Medical Sales Force Division. 4
SO ORDERED.10
On February 4, 2000, Ma. Dulcinea S. Lim, also a Territory Manager and Lagrosas’ former
girlfriend, attended a district meeting of territory managers at McDonald’s Alabang Town Center.
On appeal, the National Labor Relations Commission (NLRC) set aside the Decision of Labor
After the meeting, she dined out with her friends. She left her car at McDonald’s and rode with
Arbiter Hernandez in its Decision11 dated September 24, 2002. It held that Lagrosas was validly
Cesar R. Menquito, Jr. When they returned to McDonald’s, Lim saw Lagrosas’ car parked beside
dismissed for serious misconduct in hitting his co-employee and another person with a metal steering
her car. Lim told Menquito not to stop his car but Lagrosas followed them and slammed Menquito’s
wheel lock. The gravity and seriousness of his misconduct is clear from the fact that he deliberately
 waited for Lim and Menquito to return to McDonald’s. The NLRC also ruled that the misconduct Lagrosas filed a motion for reconsideration which the appellate court denied.
was committed in connection with his duty as Territory Manager since it occurred immediately after
the district meeting of territory managers.
In the meantime, Bristol-Myers moved to release the TRO cash bond and injunction cash bond in
view of the Decision dated January 28, 2005. On August 12, 2005, the appellate court denied the
Lagrosas moved for reconsideration. On May 7, 2003, the NLRC issued a Resolution 12reversing its motion as premature since the decision is not yet final and executory due to Lagrosas’ appeal to this
earlier ruling. It ratiocinated that the incident was not work-related since it occurred only after the Court.20
district meeting of territory managers. It emphasized that for a serious misconduct to merit
dismissal, it must be connected with the employee’s work. The dispositive portion of the Resolution
Bristol-Myers filed a motion for reconsideration. On October 28, 2005, the appellate court resolved:
states:

WHEREFORE, the petitioner’s Motion [f]or Reconsideration dated September 6, 2005 is

WHEREFORE, premises considered, We find this time no reason to alter the Labor Arbiter’s
PARTIALLY GRANTED and the Resolution of August 12, 2005 is RECONSIDERED and SET
Decision of February 28, 2002 and hereby affirm the same in toto. We vacate our previous Decision
ASIDE. The temporary restraining order cash bond in the amount of SIX HUNDRED THOUSAND
of September 24, 2002.
PESOS (P600,000.00) which was posted by the petitioners on July 19, 2004 is ordered
DISCHARGED and RELEASED to the petitioners.
SO ORDERED.13
SO ORDERED.21
Bristol-Myers filed a motion for reconsideration which the NLRC denied in an Order dated
February 4, 2004 in NLRC NCR Case No. 00-03-02821-99 (NLRC NCR CA No. 031646-02).14 Later,
The appellate court held that upon the expiration of the TRO, the cash bond intended for it also
Labor Arbiter Hernandez issued a writ of execution. 15 Notices of garnishment were then served upon
expired. Thus, the discharge and release of the cash bond for the expired TRO is proper. But the
the Philippine British Assurance Co., Inc. for the supersedeas bond posted by Bristol-Myers and the
appellate court disallowed the discharge of the injunction cash bond since the writ of preliminary
Bank of the Philippine Islands for the balance of the judgment award. 16
injunction was issued pendente lite. Since there is a pending appeal with the Supreme Court, the
Decision dated January 28, 2005 is not yet final and executory.
Bristol-Myers moved to quash the writ of execution contending that it timely filed a petition for
certiorari with the Court of Appeals. The appellate court gave due course to Bristol-Myers’ petition
Hence, the instant petitions.
and issued a temporary restraining order (TRO)17enjoining the enforcement of the writ of execution
and notices of garnishment. Upon the expiration of the TRO, the appellate court issued a writ of
preliminary injunction dated September 17, 2004.18 In G.R. No. 168637, Lagrosas assigns the following errors:

Bristol-Myers then moved to discharge and release the TRO cash bond. It argued that since it has
posted an injunction cash bond, the TRO cash bond should be legally discharged and released.
On January 28, 2005, the appellate court rendered the following Decision:
WHEREFORE, the petition is GRANTED. The Resolution of May 7, 2003 and the Order of
February 4, 2004 in NLRC NCR Case No. [00-03-02821-99] (NLRC NCR CA No. [031646-02]), are
REVERSED and SET ASIDE. The public respondent NLRC’s Decision dated September 24, 2002
which reversed the Labor Arbiter’s decision and in effect sustained the legality of the private
respondent’s termination and the dismissal of his claim for the fair market value of the [Team
Share] stock option grant is REINSTATED and AFFIRMED, with MODIFICATION that the
petitioner shall pay the private respondent the monetary equivalent of his accrued and unused
combined sick/vacation leave plus ten (10%) percent thereof, as attorney’s fees. The injunction bond
and the TRO bond previously posted by the petitioner are DISCHARGED.
I.
…the Honorable Court of Appeals in declaring that the termination of employment of the petitioner-
appellant was legal had decided a question of substance in a way not in accord with the labor laws
and jurisprudence and departed from the accepted and usual course of judicial proceedings, as to
call for the exercise of this Honorable Court’s power of review and/or supervision.
II.
…the Honorable Court of Appeals in imposing the penalty of dismissal, being a penalty too harsh in
this case, decided a question of substance in a way not in accord with the labor laws and
jurisprudence and departed from the accepted and usual course of judicial proceedings, as to call for
the exercise of this Honorable Court’s power of review and/or supervision. 22

SO ORDERED.19 In G.R. No. 170684, Bristol-Myers raises the following issue:

[Whether or not the Honorable] Court of Appeals committed grave abuse of discretion amounting to
The appellate court considered the misconduct as having been committed in connection with
Lagrosas’ duty as Territory Manager since it occurred immediately after the district meeting of lack or excess of jurisdiction in disallowing the release and discharge of petitioner’s injunction
territory managers. It also held that the gravity and seriousness of the misconduct cannot be denied. bond.23
Lagrosas employed such a degree of violence that caused damage not only to Menquito’s car but also
physical injuries to Lim and Menquito. Simply put, the basic issues in the instant petitions are: (1) Did the Court of Appeals err in finding
the dismissal of Lagrosas legal? and (2) Did the Court of Appeals err in disallowing the discharge
 and release of the injunction cash bond?
On the first issue, serious misconduct as a valid cause for the dismissal of an employee is defined
simply as improper or wrong conduct. It is a transgression of some established and definite rule of
action, a forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and
not mere error of judgment. To be serious within the meaning and intendment of the law, the
misconduct must be of such grave and aggravated character and not merely trivial or unimportant.
However serious such misconduct, it must, nevertheless, be in connection with the employee’s work
to constitute just cause for his separation. The act complained of must be related to the performance
of the employee’s duties such as would show him to be unfit to continue working for the employer.24
Thus, for misconduct or improper behavior to be a just cause for dismissal, it (a) must be serious; (b)
must relate to the performance of the employee’s duties; and (c) must show that the employee has
become unfit to continue working for the employer. 25
Tested against the foregoing standards, it is clear that Lagrosas was not guilty of serious misconduct.
It may be that the injury sustained by Lim was serious since it rendered her unconscious and caused
her to suffer cerebral contusion that necessitated hospitalization for several days. But we fail to see
how such misconduct could be characterized as work-related and reflective of Lagrosas’ unfitness to
continue working for Bristol-Myers.
Although we have recognized that fighting within company premises may constitute serious
misconduct, we have also held that not every fight within company premises in which an employee is
involved would automatically warrant dismissal from service. 26More so, in this case where the
incident occurred outside of company premises and office hours and not intentionally directed
against a co-employee, as hereafter explained.
First, the incident occurred outside of company premises and after office hours since the district
meeting of territory managers which Lim attended at McDonald’s had long been finished.
McDonald’s may be considered an extension of Bristol-Myers’ office and any business conducted
therein as within office hours, but the moment the district meeting was concluded, that ceased too.
When Lim dined with her friends, it was no longer part of the district meeting and considered
official time. Thus, when Lagrosas assaulted Lim and Menquito upon their return, it was no longer
within company premises and during office hours. Second, Bristol-Myers itself admitted that
Lagrosas intended to hit Menquito only. In the Memorandum27 dated March 23, 2000, it was stated
that "You got out from your car holding an umbrella steering wheel lock and proceeded to hit Mr.
Menquito. Dulce tried to intervene, but you accidentally hit her on the head, knocking her
unconscious."28 Indeed, the misconduct was not directed against a co-employee who unfortunately
got hit in the process. Third, Lagrosas was not performing official work at the time of the incident.
He was not even a participant in the district meeting. Hence, we fail to see how his action could have
reflected his unfitness to continue working for Bristol-Myers.
In light of Bristol-Myers’ failure to adduce substantial evidence to prove that Lagrosas was guilty of
serious misconduct, it cannot use this ground to justify his dismissal. Thus, the dismissal of
Lagrosas’ employment was without factual and legal basis.
On the second issue, it is settled that the purpose of a preliminary injunction is to prevent threatened
or continuous irremediable injury to some of the parties before their claims can be thoroughly
studied and adjudicated. Its sole aim is to preserve the status quo until the merits of the case can be
heard fully.29
A preliminary injunction may be granted only when, among other things, the applicant, not
explicitly exempted, files with the court where the action or proceeding is pending, a bond executed
to the party or person enjoined, in an amount to be fixed by the court, to the effect that the applicant
will pay such party or person all damages which he may sustain by reason of the injunction or
temporary restraining order if the court should finally decide that the applicant was not entitled
thereto. Upon approval of the requisite bond, a writ of preliminary injunction shall be issued. 30
The injunction bond is intended as a security for damages in case it is finally decided that the
injunction ought not to have been granted. Its principal purpose is to protect the enjoined party
against loss or damage by reason of the injunction, and the bond is usually conditioned
accordingly.31
In this case, the Court of Appeals issued the writ of preliminary injunction to enjoin the
implementation of the writ of execution and notices of garnishment "pending final resolution of this
case or unless the [w]rit is sooner lifted by the Court."32
By its Decision dated January 28, 2005, the appellate court disposed of the case by granting Bristol-
Myers’ petition and reinstating the Decision dated September 24, 2002 of the NLRC which dismissed
the complaint for dismissal. It also ordered the discharge of the TRO cash bond and injunction cash
bond. Thus, both conditions of the writ of preliminary injunction were satisfied.
Notably, the appellate court ruled that Lagrosas had no right to the monetary awards granted by the
labor arbiter and the NLRC, and that the implementation of the writ of execution and notices of
garnishment was properly enjoined. This in effect amounted to a finding that Lagrosas did not
sustain any damage by reason of the injunction. To reiterate, the injunction bond is intended to
protect Lagrosas against loss or damage by reason of the injunction only. Contrary to Lagrosas’
claim, it is not a security for the judgment award by the labor arbiter. 33
Considering the foregoing, we hold that the appellate court erred in disallowing the discharge and
release of the injunction cash bond.
WHEREFORE, the two consolidated petitions are GRANTED. In G.R. No. 168637, filed by Michael
J. Lagrosas, the Decision dated January 28, 2005, and the Resolution dated June 23, 2005 of the
Court of Appeals in CA-G.R. SP No. 83885 are REVERSED. The Resolution dated May 7, 2003, and
the Order dated February 4, 2004 of the NLRC in NLRC NCR Case No. 00-03-02821-99 (NLRC
NCR CA No. 031646-02) are REINSTATED and hereby AFFIRMED.
In G.R. No. 170684, filed by Bristol-Myers Squibb (Phil.), Inc./Mead Johnson Phil., the Resolutions
dated August 12, 2005 and October 28, 2005 of the Court of Appeals in CA-G.R. SP No. 83885 are
REVERSED. The injunction cash bond in the amount of SIX HUNDRED THOUSAND PESOS
(P600,000) which was posted by Bristol-Myers Squibb (Phil.), Inc./Mead Johnson Phil. on September
17, 2004 is hereby ordered DISCHARGED and RELEASED to it.
No pronouncement as to costs.
SO ORDERED.
G.R. No. 172138 September 8, 2010
NELSON JENOSA and his son NIÑO CARLO JENOSA, SOCORRO CANTO and her son
PATRICK CANTO, CYNTHIA APALISOK and her daughter CYNDY APALISOK, EDUARDO
VARGAS and his son CLINT EDUARD VARGAS, and NELIA DURO and her son NONELL
GREGORY DURO, Petitioners,
vs.
REV. FR. JOSE RENE C. DELARIARTE, O.S.A., in his capacity as the incumbent Principal of the
High School Department of the University of San Agustin, and the UNIVERSITY OF SAN
AGUSTIN, herein represented by its incumbent President REV. FR. MANUEL G. VERGARA,
O.S.A., Respondents.
school.7 The DepEd asked the University to comment on the letter.8 The University replied and attached
the minutes of the 28 November 2002 meeting.9
On 3 January 2003, petitioners filed a complaint for injunction and damages with the Regional Trial
Court, Branch 29, Iloilo City (trial court) docketed as Civil Case No. 03-27460.10 Petitioners assailed the
Principal’s decision to order the immediate transfer of petitioner students as a violation of their right to due
process because the COSD was not convened.
On 5 February 2003, the trial court issued a writ of preliminary injunction and directed respondents to
admit petitioner students during the pendency of the case. 11 The 5 February 2003 Order reads:

DECISION
CARPIO, J.:
The Case
This is a petition for review1 of the 16 June 2005 Decision2 and 22 March 20063 Resolution of the Court of
Appeals in CA-G.R. SP No. 78894. In its 16 June 2005 Decision, the Court of Appeals granted the petition
of respondents University of San Augustin (University), represented by its incumbent President Rev. Fr.
Manuel G. Vergara, O.S.A. (University President), and Rev. Fr. Jose Rene C. Delariarte, O.S.A.
(Principal), in his capacity as the incumbent Principal of the High School Department of the University
(respondents) and ordered the dismissal of Civil Case Nos. 03-27460 and 03-27646 for lack of jurisdiction
over the subject matter. In its 22 March 2006 Resolution, the Court of Appeals denied the motion for
reconsideration of petitioners Nelson Jenosa and his son Niño Carlo Jenosa, Socorro Canto and her son
Patrick Canto, Cynthia Apalisok and her daughter Cyndy Apalisok, Eduardo Vargas and his son Clint
Eduard Vargas, and Nelia Duro and her son Nonell Gregory Duro (petitioners).
The Facts
WHEREFORE, let [a] Writ of Preliminary Mandatory Injunction issue. The defendants are hereby directed
to allow the plaintiff’s minor children to attend their classes during the pendency of this case, without
prejudice to any disciplinary proceeding to which any or all of them may be liable.
SO ORDERED.12
Respondents filed a motion for reconsideration and asked for the dissolution of the writ. The trial court
denied respondents’ motion. Respondents complied but with reservations.
On 25 March 2003, respondents filed a motion to dismiss. Respondents alleged that the trial court had no
jurisdiction over the subject matter of the case and that petitioners were guilty of forum shopping. On 19
May 2003, the trial court denied respondents’ motion. Respondents filed a motion for reconsideration.
On 21 April 2003, petitioners wrote the DepEd and asked that it direct the University to release the report
cards and other credentials of petitioner students.13 On 8 May 2003, the DepEd sent a letter to the
University advising it to release petitioner students’ report cards and other credentials if there was no valid
reason to withhold the same.14On 14 May 2003, the DepEd sent another letter to the University to follow-
up petitioners’ request.15 On 20 May 2003, the University replied that it could not release petitioner
students’ report cards due to their pending disciplinary case with the COSD.16

On 22 November 2002, some students of the University, among them petitioners Niño Carlo Jenosa,
On 28 May 2003, petitioners filed another complaint for mandatory injunction praying for the release of
Patrick Canto, Cyndy Apalisok, Clint Eduard Vargas, and Nonell Gregory Duro (petitioner students), were
petitioner students’ report cards and other credentials docketed as Civil Case No. 03-27646.17
caught engaging in hazing outside the school premises.1awphi1 The hazing incident was entered into the
blotter of the Iloilo City Police.4
The trial court consolidated the two cases.18
Thereafter, dialogues and consultations were conducted among the school authorities, the apprehended
students and their parents. During the 28 November 2002 meeting, the parties agreed that, instead of the On 17 June 2003, the trial court issued a writ of preliminary injunction and directed the University to
possibility of being charged and found guilty of hazing, the students who participated in the hazing release petitioner students’ report cards and other credentials. 19 Respondents filed a motion for
incident as initiators, including petitioner students, would just transfer to another school, while those who reconsideration. Respondents alleged that they could not comply with the writ because of the on-going
participated as neophytes would be suspended for one month. The parents of the apprehended students, disciplinary case against petitioner students.
including petitioners, affixed their signatures to the minutes of the meeting to signify their conformity. 5 In
view of the agreement, the University did not anymore convene the Committee on Student Discipline
(COSD) to investigate the hazing incident. On 26 June 2003, the COSD met with petitioners for a preliminary conference on the hazing incident. On 7
July 2003, the University, through the COSD, issued its report finding petitioner students guilty of hazing.
The COSD also recommended the exclusion of petitioner students from its rolls effective 28 November
On 5 December 2002, the parents of petitioner students (petitioner parents) sent a letter to the University 2002.
President urging him not to implement the 28 November 2002 agreement. 6 According to petitioner parents,
the Principal, without convening the COSD, decided to order the immediate transfer of petitioner students.
On 14 July 2003, the trial court issued an Order denying both motions for reconsideration. 20

On 10 December 2002, petitioner parents also wrote a letter to Mrs. Ida B. Endonila, School Division
Superintendent, Department of Education (DepEd), Iloilo City, seeking her intervention and prayed that
petitioner students be allowed to take the home study program instead of transferring to another
On 1 September 2003, respondents filed a special civil action for certiorari with the Court of Appeals.
Respondents insisted that the trial court had no jurisdiction over the subject matter of Civil Case Nos. 03-
27460 and 03-27646. Respondents also alleged that petitioners were guilty of forum shopping.
The Ruling of the Court of Appeals
In its 16 June 2005 Decision, the Court of Appeals granted respondents’ petition and ordered the trial court
to dismiss Civil Case Nos. 03-27460 and 03-27646 for lack of jurisdiction over the subject matter because
of petitioners’ failure to exhaust administrative remedies or for being premature. According to the Court of
Appeals, petitioners should have waited for the action of the DepEd or of the University President before
resorting to judicial action. The Court of Appeals held:
From the foregoing, it is clear that the court a quo committed grave [abuse] of discretion amounting to
LACK OF JURISDICTION in INTERFERING, pre-maturely, with the exclusive and inherent authority of
educational institutions to discipline.
In directing herein petitioners [respondents in this case] to re-admit herein private respondents [petitioners
in this case] and eventually, to release the report cards and other school credentials, prior to the action of
the President of USA and of the recommendation of the COSD, the court a quo is guilty of improper
judicial intrusion by encroaching into the exclusive prerogative of educational institutions. 21
Petitioners filed a motion for reconsideration.22 In its 22 March 2006 Resolution, the Court of Appeals
denied petitioners’ motion for lack of merit.
The Issues
another school. Petitioners Socorro Canto and Nelia Duro even wrote a letter to inform the University that
they would transfer their children to another school and requested for the pertinent papers needed for the
transfer.29 In turn, the University did not anymore convene the COSD. The University agreed that it would
no longer conduct disciplinary proceedings and instead issue the transfer credentials of petitioner students.
Then petitioners reneged on their agreement without any justifiable reason. Since petitioners’ present
complaint is one for injunction, and injunction is the strong arm of equity, petitioners must come to court
with clean hands. In University of the Philippines v. Hon. Catungal, Jr.,30 a case involving student
misconduct, this Court ruled:
Since injunction is the strong arm of equity, he who must apply for it must come with equity or with clean
hands. This is so because among the maxims of equity are (1) he who seeks equity must do equity, and (2)
he who comes into equity must come with clean hands. The latter is a frequently stated maxim which is
also expressed in the principle that he who has done inequity shall not have equity. It signifies that a
litigant may be denied relief by a court of equity on the ground that his conduct has been inequitable,
unfair and dishonest, or fraudulent, or deceitful as to the controversy in issue. 31
Here, petitioners, having reneged on their agreement without any justifiable reason, come to court with
unclean hands. This Court may deny a litigant relief if his conduct has been inequitable, unfair and
dishonest as to the controversy in issue.1avvphi1
Since petitioners have come to court with inequitable and unfair conduct, we deny them relief. We uphold
the validity of the 28 November 2002 agreement and rule that the Principal had the authority to order the
immediate transfer of petitioner students based on the 28 November 2002 agreement.
WHEREFORE, we DENY the petition. We AFFIRM the 16 June 2005 Decision and the 22 March 2006
Resolution of the Court of Appeals.

Petitioners raise the following issues: SO ORDERED.

1. Was the Court of Appeals correct in holding that Branch 29 of the Regional Trial Court of
Iloilo City in Civil Case Nos. 03-27460 and 03-27646 did not acquire jurisdiction over the
subject matter of this case for failure of petitioners to exhaust administrative remedies?

2. Was the recommendation/report/order of the Committee on Student Discipline dated 7 July

2003 valid, and did it justify the order of exclusion of petitioner students retroactive to 28
November 2002?23

The Ruling of the Court

The petition has no merit.

Discipline in education is specifically mandated by the 1987 Constitution which provides that all
educational institutions shall "teach the rights and duties of citizenship, strengthen ethical and spiritual
values, develop moral character and personal discipline."24 Schools and school administrators have the
authority to maintain school discipline25 and the right to impose appropriate and reasonable disciplinary
measures.26 On the other hand, students have the duty and the responsibility to promote and maintain the
peace and tranquility of the school by observing the rules of discipline.27

In this case, we rule that the Principal had the authority to order the immediate transfer of petitioner
students because of the 28 November 2002 agreement.28 Petitioner parents affixed their signatures to the
minutes of the 28 November 2002 meeting and signified their conformity to transfer their children to
G.R. No. 179665 April 3, 2013
SOLID BUILDERS, INC. and MEDINA FOODS INDUSTRIES, INC., Petitioners,
vs.
CHINA BANKING CORPORATION, Respondent.
DECISION
LEONARDO-DE CASTRO, J.:
This petition for review on certiorari1 assails the Decision2 dated April 16, 2007 and the Resolution3 dated
September 18, 2007 of the Court of Appeals in CA-G.R. SP No. 81968.
During the period from September 4, 1992 to March 27, 1996, China Banking Corporation (CBC) granted
several loans to Solid Builders, Inc. (SBI), which amounted to ₱139,999,234.34, exclusive of interests and
other charges. To secure the loans, Medina Foods Industries, Inc. (MFII) executed in CBC’s favor several
surety agreements and contracts of real estate mortgage over parcels of land in the Loyola Grand Villas in
Quezon City and New Cubao Central in Cainta, Rizal.4
Subsequently, SBI proposed to CBC a scheme through which SBI would sell the mortgaged properties and
share the proceeds with CBC on a 50-50 basis until such time that the whole obligation would be fully
paid. SBI also proposed that there be partial releases of the certificates of title of the mortgaged properties
without the burden of updating interests on all loans.5
In a letter dated March 20, 2000 addressed to CBC, SBI requested the restructuring of its loans, a reduction
of interests and penalties and the implementation of a dacion en pago of the New Cubao Central property.6
The letter reads:
March 20, 2000
CHINA BANKING CORPORATION
Dasmarinas cor. Juan Luna Sts.
Binondo, Manila
Attn: Mr. George Yap
Account Officer
Dear Mr. Yap,
This is to refer to our meeting held at your office last March 10, 2000.
In this regard, please allow us to call your attention on the following important matters we have discussed:
1. With respect to the penalties, we are requesting for a reduction in the rates as we find it
onerous considering the big amount of our loan (₱218,540,648.00). The interest together with
the penalties that you are imposing is similar to the ones being charged by private lending
institutions, i.e., 4.5%/month total.
2. As I had discussed with you regarding Dacion en Pago, which you categorically stated that it
could be a possibility, we are considering putting our New Cubao Central (NCC) on Dacion and
restructuring our loan with regards to our Loyola Grand Villas.
Considering that you had stated that our restructuring had not been finalized, we find it timely to raise
these urgent matters and possibly agree on a realistic and workable scheme that we can incorporate on our
final agreement.
Thank you and we strongly hope for your prompt consideration on our request.
Very truly yours,
V. BENITO R. SOLIVEN (Sgd.)
President7
In response, CBC sent SBI a letter dated April 17, 2000 stating that the loans had been completely
restructured effective March 1, 1999 in the amount of ₱218,540,646.00. On the aspect of interests and
charges, CBC suggested the updating of the obligation to avoid paying interests and charges. 8 The relevant
portion of the letter dated April 17, 2000 reads:
First of all, to clarify, the loan’s restructuring has been finalized and completed on 3/01/99 with the
booking of the Restructured loan of ₱218,540,646. Only two Amendments of Real Estate Mortgages
remain to be registered to date. Certain documents that we requested from your company since last year,
that could facilitate this amendment have not yet been forwarded to us until now. Nevertheless, this does
not change the fact that the restructuring of the loan has been done with and finalized.
This in turn is with regards to statement[s] no. 1 & 2 of your letter, referring to the interest rates and
penalties. As per our records, the rates are actually the prevailing bank interest rates. In addition, penalty
charges are imposed in the event of non-payment. To avoid experiencing having to pay more due to the
penalty charges, updating of obligations is necessary. Thus, we advise updating of your obligations to
avoid penalty charges. However, should you be able to update both interest and penalty through a "one-
time" payment, we shall present your request to Senior Management for possible reduction in penalty
charges.
Concerning statement no. 3 containing your request for the possible Dacion en Pago of your NCC
properties, as was discussed already in the meeting, it is a concern that has to be discussed with Senior
Management and approved by the Executive Committee before we can commit to you on the matter. We
suggest that your company, Solid Builders, exhaust all possibilities to sell the NCC properties yourselves
because, being a real estate company, Solid has better ways and means of selling the properties. 9
This was followed by another communication from CBC to SBI reiterating, among others, that the loan has
been restructured effective March 1, 1999 upon issuance by SBI of promissory notes in favor of CBC. The
relevant portion of that letter dated May 19, 2000 reads:
Again, in response to your query with regards the issue of the loans restructuring, to reiterate, the loan
restructuring has been finalized and completed on 3/01/99 with the booking of the Restructured loan of
₱231,716,646. The Restructured Loan was effective ever since the new Promissory Note was signed on the
said date.
The interest rates for the loans are actually rates booked since the new Promissory Notes were
effective.1âwphi1 Any move of changing it or "re-pricing" the interest is only possible every 90 days from
the booking date, which represents the interest amortization payment dates. No change or "re-pricing" in
PN-MK-TS-343026 12,121,000.00 03/01/2004 ---------------
interest rates is possible since interest payment/obligations have not yet been paid.

With regards to the possible Dacion en Pago of your NCC properties, as was discussed already in the PH₱218,540,646.00
meeting, it is a concern that has to be discussed with Senior Management and approved by the Executive ================
Committee before we can commit to you on the matter. We suggest that your company, Solid Builders,
exhaust all possibilities to sell the NCC properties yourselves because, being a real estate company, Solid
has better ways and means of selling the properties.10
Greetings!
Subsequently, in a letter dated September 18, 2000, CBC demanded SBI to settle its outstanding account
within ten days from receipt thereof. The letter dated September 18, 2000 reads:
We refer again to the balances of the abovementioned Promissory Notes amounting to PH₱218,540,646.00
excluding interest, penalties and other charges signed by you jointly and severally in our favor, which
September 18, 2000 remains unpaid up to this date despite repeated demands for payment.

SOLID BUILDERS, INC. In view of the strict regulations of Bangko Sentral ng Pilipinas on past due accounts, we regret that we
V.V. Soliven Bldg., I cannot hold these accounts further in abeyance. Accordingly, we are reiterating our request that
EDSA, San Juan, Metro Manila arrangements to have these accounts settled within ten (10) days from receipt hereof, otherwise, we shall
be constrained to refer the matter to our lawyers for collection.
1âwphi1
We enclose a Statement of Account as of September 30, 2000 for your reference and guidance.
PN NUMBER O/S BALANCE DUE DATE INTEREST
Very truly yours,

PN-MK-TS-342924 PHP 89,700,000.00 03/01/2004 04/13/1999 MERCEDES E. GERMAN (Sgd.)

Manager

PN-MK-TS-342931 19,350,000.00 03/01/2004 08/05/1999

Loans & Discounts Department – H.O.11

PN-MK-TS-342948 35,888,000.00 03/01/2004 --------------- On October 5, 2000, claiming that the interests, penalties and charges imposed by CBC were iniquitous
and unconscionable and to enjoin CBC from initiating foreclosure proceedings, SBI and MFII filed a
Complaint "To Compel Execution of Contract and for Performance and Damages, With Prayer for Writ of
Preliminary Injunction and Ex-Parte Temporary Restraining Order" in the Regional Trial Court (RTC) of
PN-MK-TS-342955 6,870,000.00 03/01/2004 ---------------
Pasig City. The case was docketed as Civil Case No. 68105 and assigned to Branch 264. 12

PN-MK-TS-342962 5,533,646.00 03/01/2004 07/26/1999 In support of their application for the issuance of writ of preliminary injunction, SBI and MFII alleged:

IV. APPLICATION FOR PRELIMINARY INJUNCTION WITH EX- PARTE TEMPORARY

PN-MK-TS-342979 21,950,000.00 03/01/2004 --------------- RESTRAINING ORDER

A. GROUNDS FOR PRELIMINARY INJUNCTION

PN-MK-TS-342986 3,505,000.00 03/01/2004 08/09/1999

1. That SBI and MFII are entitled to the reliefs demanded, among which is enjoining/restraining
PN-MK-TS-342993 19,455,000.00 03/01/2004 --------------- the commission of the acts complained of, the continuance of which will work injustice to the
plaintiffs; that such acts are in violation of the rights of plaintiffs and, if not enjoined/restrained,
will render the judgment sought herein ineffectual.
PN-MK-TS-343002 4,168,000.00 03/01/2004 ---------------
2. That under the circumstances, it is necessary to require, through preliminary injunction, CBC
to refrain from immediately enforcing its letters dated April 17, 2000 and May 19, 2000 and
September 18, 2000 during the pendency of this complaint, and
 3. That SBI and MFII submit that they are exempt from filing of a bond considering that the "Interest for the first quarter shall be @ 18.5% P.A. Thereafter, it shall be payable quarterly in arrears
letters dated April 17, 2000, May 19, 2000 and September 18, 2000 are a patent nullity, and in based on three months average rate."
the event they are not, they are willing to post such bond this Honorable Court may determine
and under the conditions required by Section 4, Rule 58. 13
In its Memorandum, defendant bank tried to show that the questioned increase in the interests was merely
in compliance with the above condition. To this Court, the explanation is insufficient. A more detailed
In its Answer and Opposition to the issuance of the writ of preliminary injunction, CBC alleged that to rationalization is required to convince the court of the fairness of the increase in interests and penalties.
implement the agreed restructuring of the loan, SBI executed ten promissory notes stipulating that the
interest rate shall be at 18.5% per annum. For its part, MFII executed third party real estate mortgage over
However, the coming explanation may probably be heard only during trial on the merits, and by then this
its properties in favor of CBC to secure the payment of SBI’s restructured loan. As SBI was delinquent in
pending incident or the entire case, may already be moot and academic if the injunctive writ is not issued. 15
the payment of the principal as well as the interest thereon, CBC demanded settlement of SBI’s account.14

The dispositive portion of the trial court’s Order dated December 14, 2000 reads:
After hearing the parties, the trial court issued an Order dated December 14, 2000 granting the application
of SBI and MFII for the issuance of a writ of preliminary injunction. The trial court held that SBI and MFII
were able to sufficiently comply with the requisites for the issuance of an injunctive writ: WHEREFORE, premises considered, the application for issuance of writ of preliminary injunction is
GRANTED.
It is well-settled that to be entitled to an injunctive writ, a party must show that: (1) the invasion of right
sought to be protected is material and substantial; (2) the right of complainant is clear and unmistakable; Defendant CHINA BANKING CORPORATION, its representatives, agents and all persons working in its
and, (3) there is an urgent and paramount necessity for the writ to prevent serious damage. behalf are hereby enjoined from enforcing the contents of its letters to plaintiffs dated April 17, 2000, May
19, 2000 and September 18, 2000, particularly the bank’s legal department or other counsel commencing
collection proceedings against plaintiffs in the amount stated in the letters and statements of account.
The Court opines that the above-mentioned requisites have been sufficiently shown by plaintiffs in this
case, accordingly, a writ of preliminary injunction is in order.
The Writ of Preliminary Injunction shall be issued upon plaintiffs’ posting of a bond executed to defendant
in the amount of Two Million Pesos (₱2,000,000.00) to the effect [that] the plaintiffs will pay defendant all
The three subject letters, particularly the letter dated September 18, 2000, indicate that the promissory
damages which the latter may sustain by reason of the injunction if it be ultimately decided that the
notes executed by Benito Soliven as President of plaintiff SBI amounted to ₱218,540,646.00, excluding
injunction is unwarranted.16
interest, penalties and other charges remained unpaid, and demand that the account be settled within ten
days, else defendant bank shall refer the latter to its lawyers for collection.
CBC sought reconsideration but the trial court denied it in an Order17 dated December 10, 2001.
The message in the letter is clear: If the account is not settled within the grace period, defendant bank will
resort to foreclosure of mortgage on the subject properties. Subsequently, CBC filed a "Motion to Dissolve Injunction Order" but this was denied in an Order18 dated
November 10, 2003. The trial court ruled that the motion was in the nature of a mere belated second
motion for reconsideration of the Order dated December 14, 2000. It also declared that CBC failed to
The actual or imminent damage to plaintiffs is likewise clear. Considering the number of parcels of land
substantiate its prayer for the dissolution of the injunctive writ.
and area involved, if these are foreclosed by defendant bank, plaintiffs’ properties and source of income
will be effectively diminished, possibly to the point of closure.
Aggrieved, CBC filed a Petition for Certiorari docketed as CA-G.R. SP No. 81968 in the Court of Appeals
where it claimed that the Orders dated December 14, 2000 (granting the application of petitioners SBI and
The only issue remaining is whether or not plaintiffs have the right to ask for an injunctive writ in order to
MFII for the issuance of writ of preliminary injunction), December 10, 2001 (denying reconsideration of
prevent defendant bank from taking over their properties.
the order dated December 14, 2000), and November 10, 2003 (denying the CBC’s motion to dissolve
injunction order) were all issued with grave abuse of discretion amounting to lack of jurisdiction. 19
Plaintiffs argued that the interest and penalties charged them in the subject letters and attached statements
of account increased during a seven-month period to an amount they described as "onerous", "usurious" ad
In a Decision dated April 16, 2007, the Court of Appeals found that, on its face, the trial court’s Order
"greedy".
dated December 14, 2000 granting the application of SBI and MFII for the issuance of a writ of
preliminary injunction had no basis as there were no findings of fact or law which would indicate the
They likewise asserted that there were on-going talks between officers of the corporations involved to treat existence of any of the requisites for the grant of an injunctive writ. It appeared to the Court of Appeals
or restructure the contracts to a dacion en pago, as there was a proposed plan of action by representatives that, in ordering the issuance of a writ of injunction, the trial court simply relied on the imposition by CBC
of plaintiffs during the meetings. of the interest rates to the loans obtained by SBI and MFII. According to the Court of Appeals, however,
the records do not reveal a clear and unmistakable right on the part of SBI and MFII that would entitle
them to the protection of a writ of preliminary injunction. Thus, the Court of Appeals granted the petition
Defendant, on the other hand, sought to explain the increase in the interest as contained in the promissory
of CBC, set aside the Orders dated December 14, 2000, December 10, 2001, and November 10, 2003 and
notes which were voluntarily and willingly signed by Soliven, therefore, binding on plaintiffs and that the
dissolved the injunctive writ issued by the RTC of Pasig City.20
proposed plan of action is merely an oral contract still in the negotiation stage and not binding.

SBI and MFII filed a motion for reconsideration but it was denied by the Court of Appeals in a Resolution
The condition on the interest payments as contained in the promissory notes are as follows:
dated September 18, 2007.
Hence, this petition.
SBI and MFII assert that the Decision dated April 16, 2007 of the Court of Appeals is legally infirm as its
conclusions are contrary to the judicial admissions of CBC. They allege that, in its Answer, CBC admitted
paragraphs 25 and 26 of the Complaint regarding the interests and charges amounting to ₱35,093,980.14
and ₱80,614,525.15, respectively, which constituted more than 50% of the total obligation of
₱334,249,151.29 as of February 15, 2000. For SBI and MFII, CBC’s admission of paragraphs 25 and 26 of
the Complaint is an admission that the interest rate imposed by CBC is usurious, exorbitant and
confiscatory. Thus, when the Court of Appeals granted the petition of CBC and ordered the lifting of the
writ of preliminary injunction it effectively disposed of the main case, Civil Case No. 68105, without trial
on the merits and rendered moot and academic as it enabled CBC to foreclose on the mortgages despite the
usurious, exorbitant and confiscatory interest rates.21
SBI and MFII also claim that the Court of Appeals either overlooked or disregarded undisputed and
admitted facts which, if properly considered, would have called for the maintenance and preservation of
the preliminary injunction issued by the trial court. They argue that the Court of Appeals did not even
consider Article 1229 of the Civil Code which provides:
Art. 1229. The judge shall equitably reduce the penalty when the principal obligation has been partly or
irregularly complied with by the debtor. Even if there has been no performance, the penalty may also be
reduced by the courts if it is iniquitous or unconscionable.
For SBI and MFII, the failure of the Court of Appeals to take into account Article 1229 of the Civil Code
and its act of lifting the preliminary injunction "would definitely pave the way for CBC’s unbridled
imposition of illegal rates of interest and immediate foreclosure" of the properties of SBI and MFII
"without the benefit of a full blown trial."22
For its part, CBC assails the petition contending that it is not allowed under Rule 45 of the Rules of Court
because it simply raises issues of fact and not issues of law. CBC further asserts that the Decision of the
Court of Appeals is an exercise of sound judicial discretion as it is in accord with the law and the
applicable provisions of this Court.23
The petition fails.
This Court has recently reiterated the general principles in issuing a writ of preliminary injunction in Palm
Tree Estates, Inc. v. Philippine National Bank24:
A preliminary injunction is an order granted at any stage of an action prior to judgment of final order,
requiring a party, court, agency, or person to refrain from a particular act or acts. It is a preservative
remedy to ensure the protection of a party’s substantive rights or interests pending the final judgment in the
principal action. A plea for an injunctive writ lies upon the existence of a claimed emergency or
extraordinary situation which should be avoided for otherwise, the outcome of a litigation would be useless
as far as the party applying for the writ is concerned.
At times referred to as the "Strong Arm of Equity," we have consistently ruled that there is no power the
exercise of which is more delicate and which calls for greater circumspection than the issuance of an
injunction. It should only be extended in cases of great injury where courts of law cannot afford an
adequate or commensurate remedy in damages; "in cases of extreme urgency; where the right is very clear;
where considerations of relative inconvenience bear strongly in complainant’s favor; where there is a
willful and unlawful invasion of plaintiff’s right against his protest and remonstrance, the injury being a
continuing one, and where the effect of the mandatory injunction is rather to reestablish and maintain a
preexisting continuing relation between the parties, recently and arbitrarily interrupted by the defendant,
than to establish a new relation."
A writ of preliminary injunction is an extraordinary event which must be granted only in the face of actual
and existing substantial rights. The duty of the court taking cognizance of a prayer for a writ of preliminary
injunction is to determine whether the requisites necessary for the grant of an injunction are present in the
case before it.25 In this connection, a writ of preliminary injunction is issued to preserve the status quo ante,
upon the applicant’s showing of two important requisite conditions, namely: (1) the right to be protected
exists prima facie, and (2) the acts sought to be enjoined are violative of that right. It must be proven that
the violation sought to be prevented would cause an irreparable injury.26
Here, SBI and MFII basically claim a right to have their mortgaged properties shielded from foreclosure by
CBC on the ground that the interest rate and penalty charges imposed by CBC on the loans availed of by
SBI are iniquitous and unconscionable. In particular, SBI and MFII assert:
There is therefore an urgent necessity for the issuance of a writ of preliminary injunction or at least a status
quo [order], otherwise, respondent bank will definitely foreclose petitioners’ properties without awaiting
the trial of the main case on the merits, with said usurious and confiscatory rates of interest as basis. 27
and
There is therefore no legal justification for the Honorable Court of Appeals to lift/dissolve the injunction
issued by the trial court, otherwise, respondent bank – on the basis of this illegal imposition of interest –
can already foreclose the properties of petitioners and render the whole case (sans trial on the merits) moot
and academic.28
On this matter, the Order dated December 14, 2000 of the trial court enumerates as the first argument
raised by SBI and MFII in support of their application for the issuance of a writ of preliminary injunction:
1. Their rights basically are for the protection of their properties put up as collateral for the loans extended
by defendant bank to them.29
As debtor-mortgagors, however, SBI and MFII do not have a right to prevent the creditor-mortgagee CBC
from foreclosing on the mortgaged properties simply on the basis of alleged "usurious, exorbitant and
confiscatory rate of interest."30 First, assuming that the interest rate agreed upon by the parties is usurious,
the nullity of the stipulation of usurious interest does not affect the lender’s right to recover the principal
loan, nor affect the other terms thereof.31 Thus, in a usurious loan with mortgage, the right to foreclose the
mortgage subsists, and this right can be exercised by the creditor upon failure by the debtor to pay the debt
due.32
Second, even the Order dated December 14, 2000 of the trial court, which granted the application for the
issuance of a writ of preliminary injunction, recognizes that the parties still have to be heard on the alleged
lack of "fairness of the increase in interests and penalties" during the trial on the merits. 33 Thus, the basis of
the right claimed by SBI and MFII remains to be controversial or disputable as there is still a need to
determine whether or not, upon consideration of the various circumstances surrounding the agreement of
the parties, the interest rates and penalty charges are unconscionable. Therefore, such claimed right cannot
be considered clear, actual and subsisting. In the absence of a clear legal right, the issuance of the
injunctive writ constitutes grave abuse of discretion.34
The Order dated December 10, 2001 also shows the reasoning of the trial court which betrays that its grant
of the application of SBI and MFII for the issuance of a writ of preliminary injunction was not based on a
clear legal right. Said the trial court:
It was likewise shown that plaintiffs SBI and MFII had the clear right and urgency to ask for injunction Neither has there been a showing of irreparable injury. An injury is considered irreparable if it is of such
because of the issue of validity of the increase in the amount of the loan obligation.35 (Emphasis supplied.) constant and frequent recurrence that no fair or reasonable redress can be had therefor in a court of law, or
where there is no standard by which their amount can be measured with reasonable accuracy, that is, it is
not susceptible of mathematical computation. The provisional remedy of preliminary injunction may only
At most, the above finding of the trial court that the validity of the increase in the amount of the loan
be resorted to when there is a pressing necessity to avoid injurious consequences which cannot be
obligation is in issue simply amounted to a finding that the rights of SBI and MFII vis-à-vis that of CBC
remedied under any standard of compensation.44
are disputed and debatable. In such a case where the complainant-movant’s right is doubtful or disputed,
the issuance of an injunctive writ is not proper.36
In the first place, any injury that SBI and MFII may suffer in case of foreclosure of the mortgaged
properties will be purely monetary and compensable by an appropriate judgment in a proper case against
Even assuming that SBI and MFII are correct in claiming their supposed right, it nonetheless disintegrates
CBC. Moreover, where there is a valid cause to foreclose on the mortgages, it cannot be correctly claimed
in the face of the ten promissory notes in the total amount of ₱218,540,648.00, exclusive of interest and
that the irreparable damage sought to be prevented by the application for preliminary injunction is the loss
penalties, issued by SBI in favor of CBC on March 1, 1999 which until now remain unpaid despite the
of the mortgaged properties to auction sale.45 The alleged entitlement of SBI and MFII to the "protection of
maturity of the said notes on March 1, 2004 and CBC’s repeated demands for payment.37 Foreclosure is
their properties put up as collateral for the loans" they procured from CBC is not the kind of irreparable
but a necessary consequence of nonpayment of mortgage indebtedness. 38 As this Court held in Equitable
injury contemplated by law. Foreclosure of mortgaged property is not an irreparable damage that will merit
PCI Bank, Inc. v. OJ-Mark Trading, Inc.39:
for the debtor-mortgagor the extraordinary provisional remedy of preliminary injunction. As this Court
stated in Philippine National Bank v. Castalloy Technology Corporation 46:
Where the parties stipulated in their credit agreements, mortgage contracts and promissory notes that the
mortgagee is authorized to foreclose the mortgaged properties in case of default by the mortgagors, the
All is not lost for defaulting mortgagors whose properties were foreclosed by creditors-mortgagees. The
mortgagee has a clear right to foreclosure in case of default, making the issuance of a Writ of Preliminary
respondents will not be deprived outrightly of their property, given the right of redemption granted to them
Injunction improper. x x x. (Citation omitted.)
under the law. Moreover, in extrajudicial foreclosures, mortgagors have the right to receive any surplus in
the selling price. Thus, if the mortgagee is retaining more of the proceeds of the sale than he is entitled to,
In addition, the default of SBI and MFII to pay the mortgage indebtedness disqualifies them from availing this fact alone will not affect the validity of the sale but will give the mortgagor a cause of action to recover
of the equitable relief that is the injunctive writ. In particular, SBI and MFII have stated in their Complaint such surplus. (Citation omitted.)
that they have made various requests to CBC for restructuring of the loan.40 The trial court’s Order dated
December 14, 2000 also found that SBI wrote several letters to CBC "requesting, among others, for a
The En Banc Resolution in A.M. No. 99-10-05-0, Re: Procedure in Extrajudicial or Judicial Foreclosure of
reduction of interests and penalties and restructuring of the loan."41 A debtor’s various and constant
Real Estate Mortgages, further stacks the odds against SBI and MFII. Issued on February 20, 2007, or
requests for deferment of payment and restructuring of loan, without actually paying the amount due, are
some two months before the Court of Appeals promulgated its decision in this case, the resolution
clear indications that said debtor was unable to settle his obligation. 42 SBI’s default or failure to settle its
embodies the additional guidelines intended to aid courts in foreclosure proceedings, specifically limiting
obligation is a breach of contractual obligation which tainted its hands and disqualified it from availing of
the instances, and citing the conditions, when a writ against foreclosure of a mortgage may be issued, to
the equitable remedy of preliminary injunction.
wit:

As SBI is not entitled to the issuance of a writ of preliminary injunction, so is MFII. The accessory follows
(1) No temporary restraining order or writ of preliminary injunction against the extrajudicial
the principal. The accessory obligation of MFII as accommodation mortgagor and surety is tied to SBI’s
foreclosure of real estate mortgage shall be issued on the allegation that the loan secured by the
principal obligation to CBC and arises only in the event of SBI’s default.
mortgage has been paid or is not delinquent unless the application is verified and supported by
evidence of payment.
Thus, MFII’s interest in the issuance of the writ of preliminary injunction is necessarily prejudiced by
SBI’s wrongful conduct and breach of contract.
(2) No temporary restraining order or writ of preliminary injunction against the extrajudicial
foreclosure of real estate mortgage shall be issued on the allegation that the interest on the loan
Even Article 1229 of the Civil Code, which SBI and MFII invoke, works against them. Under that is unconscionable, unless the debtor pays the mortgagee at least twelve percent per annum
provision, the equitable reduction of the penalty stipulated by the parties in their contract will be based on a interest on the principal obligation as stated in the application for foreclosure sale, which shall
finding by the court that such penalty is iniquitous or unconscionable. Here, the trial court has not yet made be updated monthly while the case is pending.
a ruling as to whether the penalty agreed upon by CBC with SBI and MFII is unconscionable. Such finding
will be made by the trial court only after it has heard both parties and weighed their respective evidence in
(3) Where a writ of preliminary injunction has been issued against a foreclosure of mortgage,
light of all relevant circumstances. Hence, for SBI and MFII to claim any right or benefit under that
the disposition of the case shall be speedily resolved. To this end, the court concerned shall
provision at this point is premature.
submit to the Supreme Court, through the Office of the Court Administrator, quarterly reports
on the progress of the cases involving ten million pesos and above.
As no clear right that warrants the extraordinary protection of an injunctive writ has been shown by SBI
and MFII to exist in their favor, the first requirement for the grant of a preliminary injunction has not been
(4) All requirements and restrictions prescribed for the issuance of a temporary restraining
satisfied. In the absence of any requisite, and where facts are shown to be wanting in bringing the matter
order/writ of preliminary injunction, such as the posting of a bond, which shall be equal to the
within the conditions for its issuance, the ancillary writ of injunction must be struck down for having been
amount of the outstanding debt, and the time limitation for its effectivity, shall apply as well to
rendered in grave abuse of discretion.43 Thus, the Court of Appeals did not err when it granted the petition
a status quo order.47
for certiorari of CBC and ordered the dissolution of the writ of preliminary injunction issued by the trial
court.
The guidelines speak of strict exceptions and conditions. 48 To reverse the decision of the Court of Appeals
and reinstate the writ of preliminary injunction issued by the trial court will be to allow SBI and MFII to
circumvent the guidelines and conditions provided by the En Banc Resolution in A.M. No. 99-10-05-0
dated February 20, 2007 and prevent CBC from foreclosing on the mortgaged properties based simply on
the allegation that the interest on the loan is unconscionable. This Court will not permit such a situation.
What cannot be done directly cannot be done indirectly.49

All told, the relevant circumstances in this case show that there was failure to satisfy the requisites for the
issuance of a writ of preliminary injunction. The injunctive writ issued by the trial court should therefore
be lifted and dissolved. That was how the Court of Appeals decided. That is how it should be.

WHEREFORE, the petition is hereby DENIED.

SO ORDERED.
G.R. No. 172909 March 5, 2014
SPOUSES SILVESTRE O. PLAZA AND ELENA Y. PLAZA, Petitioners,
vs.
GUILLERMO LUSTIVA, ELEODORA VDA. DE MARTINEZ AND VICKY SAYSON
GOLOSENO, Respondents.
DECISION
BRION, J.:
Through a petition for review on certiorari,1 filed under Rule 45 of the Rules of Court, the petitioners,
spouses Silvestre O. Plaza and Elena Y. Plaza, seek the reversal of the decision 2 dated October 24, 2005
and the Resolution3 dated April 6, 2006 of the Court of Appeals (CA) in CA-G.R. SP No. 59859.
THE FACTS
On August 28, 1997, the CA4 ruled that among the Plaza siblings, namely: Aureliano, Emiliana, Vidal,
Marciano, and Barbara, Barbara was the owner of the subject agricultural land. The decision became final
and executory and Barbara's successors, respondents Guillermo Lustiva, Eleodora Vda. de Martinez and
Vicky Sayson Goloseno, have continued occupying the property.
On September 14, 1999, Vidal’s son and daughter-in-law, the petitioners, filed a Complaint for Injunction,
Damages, Attorney’s Fees with Prayer for the Issuance of the Writ of Preliminary Injunction and/or
Temporary Restraining Order against the respondents and the City Government of Butuan. They prayed
that the respondents be enjoined from unlawfully and illegally threatening to take possession of the subject
property. According to the petitioners, they acquired the land from Virginia Tuazon in 1997; Tuazon was
the sole bidder and winner in a tax delinquency sale conducted by the City of Butuan on December 27,
1996.
In their answer, the respondents pointed out that they were never delinquent in paying the land taxes and
were in fact not aware that their property had been offered for public auction. Moreover, Tuazon, being a
government employee, was disqualified to bid in the public auction, as stated in Section 89 of the Local
Government Code of 1991.5 As Tuazon’s participation in the sale was void, she could have not transferred
ownership to the petitioners. Equally important, the petitioners merely falsified the property tax declaration
by inserting the name of the petitioners’ father, making him appear as a co-owner of the auctioned land.
Armed with the falsified tax declaration, the petitioners, as heirs of their father, fraudulently redeemed the
land from Tuazon. Nonetheless, there was nothing to redeem as the land was not sold. For these
irregularities, the petitioners had no right to the Writ of Preliminary Injunction and/or Temporary
Restraining Order prayed for against them.
THE RTC’S RULING
In its December 14, 1999 order,6 the Regional Trial Court (RTC) of Butuan City, Branch 5, reconsidered
its earlier order,7 denied the prayer for a Writ of Preliminary Injunction, and ordered that the possession
and occupation of the land be returned to the respondents. The RTC found that the auction sale was tainted
with irregularity as the bidder was a government employee disqualified in accordance with Section 89 of
the Local Government Code of 1991. The petitioners are not buyers in good faith either. On the contrary,
they were in bad faith for having falsified the tax declaration they redeemed the property with.
THE CA’S RULING
Through a petition for review on certiorari under Rule 65, the petitioners challenged the RTC’s order
before the CA.
While the petition for review on certiorari was pending before the CA, the petitioners filed an action for
specific performance8 against the City Government of Butuan. According to the petitioners, they acquired
possession and ownership over the auctioned property when they redeemed it from Tuazon. The City
Government of Butuan must therefore issue them a certificate of sale. 9
In its October 24, 2005 decision,10 the CA affirmed the RTC’s ruling, found the petitioners guilty of forum
shopping, dismissed the case, and referred the case to the Court and to the Integrated Bar of the Philippines
for investigation and institution of the appropriate administrative action.11 The CA, after legal analysis,
similarly concluded that for being disqualified to bid under Section 89 of the Local Government Code of
1991, Tuazon never obtained ownership over the property; much less transmit any proprietary rights to the
petitioners. Clearly, the petitioners failed to establish any clear and unmistakable right enforceable by the
injunctive relief.
On April 6, 2006, the CA rejected the petitioners’ motion for reconsideration.
THE PARTIES’ ARGUMENTS
The petitioners filed the present petition for review on certiorari with this Court to challenge the CA
rulings. The petitioners maintain that they did not falsify the tax declaration in acquiring the auctioned
property. Moreover, assuming that Tuazon, the sole bidder, was indeed disqualified from participating in
the public auction, Section 18112of the Local Government Code of 1991 finds application. Applying the
law, it is as if there was no bidder, for which the City Government of Butuan was to be considered the
purchaser of the land in auction. Therefore, when the petitioners bought the land, they bought it directly
from the purchaser - City Government of Butuan - and not from Tuazon, as redeemers.
Also, the respondents may not question the validity of the public auction for failing to deposit with the
court the amount required by Section 26713 of the Local Government Code of 1991.
Finally, the petitioners argue that they did not commit forum shopping, as the reliefs prayed for in the
present case and in the specific performance case are not the same. In the present case, they merely
impleaded the City Government of Butuan as a nominal party to pay for the value of the land only if
possession of the land was awarded to the respondents. On the other hand, the complaint for specific
performance prayed that the City Government of Butuan execute the necessary certificate of sale and other
relevant documents pertaining to the auction.
The respondents, for their part, reiterate the lower courts’ findings that there could have been no legal
redemption in favor of the petitioners as the highest bidder was disqualified from bidding. Moreover, the
CA correctly applied the law in finding the petitioners guilty of forum shopping. Most importantly, the
grant of preliminary injunction lies in the sound discretion of the court and the petitioners failed to show
proof that they are entitled to it.
Meanwhile, on August 8, 2013, the RTC dismissed the main action and ordered the petitioners to pay the
respondents attorney’s fees and litigation expenses.14
THE COURT’S RULING
We resolve to deny the petition for lack of merit.
The petitioners may not
raise factual issues
The petitioners maintain that they did not falsify the tax declaration they reimbursed the property with.
According to them, the document already existed in 1987, way before they acquired the land in 1997.
Contrary likewise to the lower courts’ finding, they did not purchase the land from Tuazon as
redemptioners; they directly bought the property from the City Government of Butuan.
These factual contests are not appropriate for a petition for review on certiorari under Rule 45. The Court is
not a trier of facts.15 The Court will not revisit, re-examine, and re-evaluate the evidence and the factual
conclusions arrived at by the lower courts.16 In the absence of compelling reasons, the Court will not
disturb the rule that factual findings of the lower tribunals are final and binding on this Court.17
Sections 181 and 267 of the Local Government Code of 1991 are inapplicable; these provisions do not
apply to the present case
18
The petitioners may not invoke Section 181 of the Local Government Code of 1991 to validate their
alleged title. The law authorizes the local government unit to purchase the auctioned property only in
instances where "there is no bidder" or "the highest bid is xxx insufficient." A disqualified bidder is not
among the authorized grounds. The local government also never undertook steps to purchase the property
under Section 181 of the Local Government Code of 1991, presumably because it knew the invoked
provision does not apply.
Neither can the Court agree with the petitioners’ stance that the respondents’ defense — the petitioners’
defective title — must fail for want of deposit to the court the amount required by Section 267 of the Local
Government Code. The provision states:
Section 267. Action Assailing Validity of Tax Sale. - No court shall entertain any action assailing the
validity or any sale at public auction of real property or rights therein under this Title until the taxpayer
shall have deposited with the court the amount for which the real property was sold, together with interest
of two percent (2%) per month from the date of sale to the time of the institution of the action. The amount
so deposited shall be paid to the purchaser at the auction sale if the deed is declared invalid but it shall be
returned to the depositor if the action fails.
Neither shall any court declare a sale at public auction invalid by reason or irregularities or informalities in
the proceedings unless the substantive rights of the delinquent owner of the real property or the person
having legal interest therein have been impaired. [underscores ours; italics supplied]
A simple reading of the title readily reveals that the provision relates to actions for annulment of tax sales.
The section likewise makes use of terms "entertain" and "institution" to mean that the deposit requirement
applies only to initiatory actions assailing the validity of tax sales. The intent of the provision to limit the
deposit requirement to actions for annulment of tax sales led to the Court’s ruling in National Housing
Authority v. Iloilo City, et al.19 that the deposit requirement is jurisdictional — a condition necessary for
the court to entertain the action:
As is apparent from a reading of the foregoing provision, a deposit equivalent to the amount of the sale at
public auction plus two percent (2%) interest per month from the date of the sale to the time the court
action is instituted is a condition — a "prerequisite," to borrow the term used by the acknowledged father
of the Local Government Code — which must be satisfied before the court can entertain any action
assailing the validity of the public auction sale. The law, in plain and unequivocal language, prevents the
court from entertaining a suit unless a deposit is made. xxx. Otherwise stated, the deposit is a jurisdictional
requirement the nonpayment of which warrants the failure of the action.
xxxx
Clearly, the deposit precondition is an ingenious legal device to guarantee the satisfaction of the tax
delinquency, with the local government unit keeping the payment on the bid price no matter the final
outcome of the suit to nullify the tax sale.20
The Court would later reiterate the jurisdictional nature of the deposit in Wong v. City of Iloilo,21 and
pronounce:
In this regard, National Housing Authority v. Iloilo City holds that the deposit required under Section 267
of the Local Government Code is a jurisdictional requirement, the nonpayment of which warrants the
dismissal of the action. Because petitioners in this case did not make such deposit, the RTC never acquired
jurisdiction over the complaints.22
These rulings clearly render inapplicable the petitioners’ insistence that the respondents should have made
a deposit to the court. The suit filed by the petitioners was an action for injunction and damages; the issue
of nullity of the auction was raised by the respondents themselves merely as a defense and in no way
converted the action to an action for annulment of a tax sale.
The petitioners failed to show clear
and unmistakable rights to be protected
by the writ; the present action has been
rendered moot and academic by the
dismissal of the main action
As the lower courts correctly found, Tuazon had no ownership to confer to the petitioners despite the
latter’s reimbursement of Tuazon’s purchase expenses. Because they were never owners of the property,
the petitioners failed to establish entitlement to the writ of preliminary injunction. "[T]o be entitled to an
injunctive writ, the right to be protected and the violation against that right must be shown. A writ of
preliminary injunction may be issued only upon clear showing of an actual existing right to be protected
during the pendency of the principal action. When the complainant’s right or title is doubtful or disputed,
he does not have a clear legal right and, therefore, the issuance of injunctive relief is not proper."23
Likewise, upon the dismissal of the main case by the RTC on August 8, 2013, the question of issuance of
the writ of preliminary injunction has become moot and academic. In Arevalo v. Planters Development
Bank,24 the Court ruled that a case becomes moot and academic when there is no more issue between the
parties or object that can be served in deciding the merits of the case. Upon the dismissal of the main
action, the question of the non-issuance of a writ of preliminary injunction automatically died with it. A
writ of preliminary injunction is a provisional remedy; it is auxiliary, an adjunct of, and subject to the
determination of the main action. It is deemed lifted upon the dismissal of the main case, any appeal
therefrom notwithstanding.25
The petitioners are guilty
of forum shopping
We agree with the CA that the petitioners committed forum shopping when they filed the specific
performance case despite the pendency of the present case before the CA. In the recent case of Heirs of
Marcelo Sotto, etc., et al. v. Matilde S. Palicte,26 the Court laid down the three ways forum shopping may
be committed: 1) through litis pendentia — filing multiple cases based on the same cause of action and
with the same prayer, the previous case not having been resolved yet; 2) through res judicata — filing
multiple cases based on the same cause of action and the same prayer, the previous case having been
finally resolved; and 3) splitting of causes of action — filing multiple cases based on the same cause of
action but with different prayers — the ground to dismiss being either litis pendentia or res judicata. "The
requisites of litis pendentia are: (a) the identity of parties, or at least such as representing the same interests
in both actions; (b) the identity of rights asserted and relief prayed for, the relief being founded on the same
facts; and (c) the identity of the two cases such that judgment in one, regardless of which party is
successful, would amount to res judicata in the other."27

Noticeable among these three types of forum shopping is the identity of the cause of action in the different
cases filed. Cause of action is "the act or omission by which a party violates the right of another." 28

The cause of action in the present case (and the main case) is the petitioners’ claim of ownership of the
land when they bought it, either from the City Government of Butuan or from Tuazon. This ownership is
the petitioners’ basis in enjoining the respondents from dispossessing them of the property. On the other
hand, the specific performance case prayed that the City Government of Butuan be ordered to issue the
petitioners the certificate of sale grounded on the petitioners’ ownership of the land when they had bought
it, either from the City Government of Butuan or from Tuazon. While it may appear that the main relief
prayed for in the present injunction case is different from what was prayed for in the specific performance
case, the cause of action which serves as the basis for the reliefs remains the same — the petitioners’
alleged ownership of the property after its purchase in a public auction.

Thus, the petitioners' subsequent filing of the specific performance action is forum shopping of the third
kind-splitting causes of action or filing multiple cases based on the same cause of action, but with different
prayers. As the Court has held in the past, "there is still forum shopping even if the reliefs prayed for in the
two cases are different, so long as both cases raise substantially the same issues."29

Similarly, the CA correctly found that the petitioners and their counsel were guilty of forum shopping
based on litis pendentia. Not only were the parties in both cases the same insofar as the City Government
of Butuan is concerned, there was also identity of rights asserted and identity of facts alleged. The cause of
action in the specific performance case had already been ruled upon in the present case, although it was
still pending appeal before the CA. Likewise, the prayer sought in the specific performance case-for the
City Government ofButuan to execute a deed of sale in favor of the petitioners - had been indirectly ruled
upon in the present case when the R TC declared that no certificate of sale could be issued because there
had been no valid sale.

WHEREFORE, premises considered, the Court DENIES the petition for review on certiorari.1âwphi1 The
decision dated October 24, 2005 and the resolution dated April 6, 2006 of the Court of Appeals in CA-G.R.
SP No. 59859 are hereby AFFIRMED.

SO ORDERED.
G.R. No. 172206 July 3, 2013
OFFICE OF THE OMBUDSMAN, PETITIONER,
vs.
ERNESTO M. DE CHAVEZ, ROLANDO L. LONTOC, SR., DR. PORFIRIO C. LIGAYA,
ROLANDO L. LONTOC, JR. AND GLORIA M. MENDOZA, RESPONDENTS.
DECISION
PERALTA, J.:
This resolves the Petition for Review on Certiorari under Rule 45 of the Rules of Court, praying that the
Resolution1of the Court of Appeals (CA), dated April 7, 2006, be reversed and set aside.
The crux of the controversy is whether the Batangas State University Board of Regents (BSU-BOR) could
validly enforce the Office of the Ombudsman's Joint Decision dated February 14, 2005 and Supplemental
Resolution dated July 12, 2005, finding herein respondents guilty of dishonesty and grave misconduct and
imposing the penalty of dismissal from service with its accessory penalties, despite the fact that said Joint
Decision and Supplemental Resolution are pending appeal before the CA.
In the final reckoning, We stand firm by Our conclusion that the administrative penalty of dismissal from
the service imposed upon herein appellants is not yet final and immediately executory in nature in view of
the appeal interposed therefrom by the appellants before this Court, and this fact, in the end, impelled Us to
act with favor upon appellants' prayer for injunctive relief to stay the execution of the impugned Resolution
of the Board of Regents of BSU.
Wherefore, premises considered, the Ombudsman's Motion to Recall the TRO is denied. On the other
hand, appellants' Urgent Motion for Issuance of a Writ of Preliminary Injunction is granted. Accordingly,
let a Writ of Preliminary Injunction be issued, as it is hereby issued, conditioned upon the posting by the
appellants of an Injunction Bond in the sum of Php10,000.00, enjoining the Board of Regents of BSU, and
all other persons and agents acting under its command authority, pending the complete resolution of this
appeal, from effecting the enforcement and implementation of its Resolution No. 18, Series of 2005 issued
pursuant to the July 12, 2005 Supplemental Resolution of the Ombudsman, Central Office.
SO ORDERED.2
Petitioners then filed a petition for review on certiorari before this Court, assailing the aforequoted CA
Resolution dated April 7, 2006, alleging that:
I.

On August 18, 2005, the BSU-BOR received an Order from Deputy Ombudsman Victor Fernandez
WITH DUE RESPECT, THE HONORABLE COURT OF APPEALS DISREGARDED THE WELL-
directing the former to enforce the aforementioned Office of the Ombudsman's Joint Decision and
ENTRENCHED RULE AGAINST FORUM SHOPPING WHEN, INSTEAD OF OUTRIGHTLY
Supplemental Resolution. Pursuant to said Order, the BSU-BOR issued Resolution No. 18, series of 2005,
DISMISSING RESPONDENTS' PETITION, THE SAID COURT TOOK COGNIZANCE OF THE
dated August 22, 2005, resolving to implement the Order of the Office of the Ombudsman. Thus, herein
PETITION AND SUBSEQUENTLY ISSUED ITS RESOLUTIONS DATED 17 FEBRUARY 2006 AND
respondents filed a petition for injunction with prayer for issuance of a temporary restraining order or
7 APRIL 2006, RESPECTIVELY;
preliminary injunction before the Regional Trial Court of Batangas City, Branch 4 (RTC), against the
BSU-BOR. The gist of the petition before the RTC is that the BSU-BOR should be enjoined from
enforcing the Ombudsman's Joint Decision and Supplemental Resolution because the same are still on II.
appeal and, therefore, are not yet final and executory.
WITH DUE RESPECT, THE HONORABLE COURT OF APPEALS SERIOUSLY OVERLOOKED
On September 26, 2005, the RTC ordered the dismissal of herein respondents' petition for injunction on the THE PROVISIONS OF RULE 58 OF THE 1997 REVISED RULES OF CIVIL PROCEDURE WHEN IT
ground of lack of cause of action. Respondents filed their notice of appeal and promptly filed a Motion for TOOK COGNIZANCE OF RESPONDENTS' UNVERIFIED PETITION AND SUBSEQUENTLY
Issuance of a Temporary Restraining Order and/or Injunction dated December 8, 2005 with the CA. On ISSUED ITS 17 FEBRUARY 2006 AND 7 APRIL 2006 RESOLUTIONS;
February 17, 2006, the CA issued a Resolution granting respondents' prayer for a temporary restraining
order enjoining the BSU-BOR from enforcing its Resolution No. 18, series of 2005.
III.

Thereafter, on March 7, 2006, the Office of the Ombudsman filed a Motion to Intervene and to Admit
THE ISSUANCE BY THE HONORABLE COURT OF APPEALS OF THE 17 FEBRUARY 2006 AND
Attached Motion to Recall Temporary Restraining Order, with the Motion to Recall Temporary
7 APRIL 2006 RESOLUTIONS ENJOINING THE IMPLEMENTATION OF BOARD RESOLUTION
Restraining Order attached thereto. Respondents opposed said motion and then filed an Urgent Motion for
NO. 18, SERIES OF 2005 ISSUED BY THE BOARD OF REGENTS OF BATANGAS STATE
Issuance of a Writ of Preliminary Injunction. On April 7, 2006, the CA issued the Resolution subject of the
UNIVERSITY UNDULY DISREGARDS THE ESTABLISHED RULES RELATIVE TO
present petition, pertinent portions of which are reproduced below:
IMPLEMENTATION OF OMBUDSMAN DECISION PENDING APPEAL, CONSIDERING THAT:

At the outset, let it be emphasized that We are accepting and taking cognizance of the pleadings lodged by
BOARD RESOLUTION NO. 18, SERIES OF 2005 WAS ISSUED BY THE BOARD OF REGENTS OF
the Office of the Ombudsman only in so far as to afford it with ample opportunity to comment on and
THE BATANGAS STATE UNIVERSITY PURSUANT TO THE JOINT DECISION AND
oppose appellants' application for injunctive relief, but not for the purpose of allowing the Ombudsman to
SUPPLEMENTAL RESOLUTION ISSUED BY THE OFFICE OF THE OMBUDSMAN.
formally and actively intervene in the instant appeal. Basically, this is a regular appeal impugning the
disposition of the trial court, the pivotal issue of which is only for the appellants and the Board of Regents
of BSU to settle and contest, and which may be completely adjudicated upon without the active UNDER THE OMBUDSMAN RULES OF PROCEDURE, AN APPEAL DOES NOT STAY THE
participation of the Office of the Ombudsman. EXECUTION OF DECISIONS, RESOLUTIONS OR ORDERS ISSUED BY THE OFFICE OF THE
OMBUDSMAN.
xxxx
 IV.
RESPONDENTS ARE NOT ENTITLED TO THE INJUNCTIVE RELIEF PRAYED FOR IN THEIR
UNVERIFIED MOTION FILED BEFORE THE HONORABLE COURT OF APPEALS.3
Controverting petitioner's claims, respondents in turn allege that:
1. PETITIONER (OMBUDSMAN) HAS NO LEGAL PERSONALITY TO INSTITUTE THE
INSTANT PETITION INASMUCH AS IT IS NOT A PARTY TO THE APPEALED CASE
PENDING BEFORE THE COURT OF APPEALS;
2. ASSUMING THAT THE PETITIONER HAS THE LEGAL PERSONALITY TO
INTERVENE IN THE APPEALED CASE BEFORE THE COURT OF APPEALS, THE
INSTANT PETITION IS NOT THE PROPER RECOURSE AVAILABLE TO THE
PETITIONER; AND
3. THE COURT OF APPEALS DID NOT COMMIT ANY GRAVE ABUSE OF
DISCRETION IN ISSUING THE ASSAILED RESOLUTIONS. 4
At the outset, the Court must clarify that a petition for review on certiorari is not the proper remedy to
question the CA Resolution dated April 7, 2006 granting the Writ of Preliminary Injunction and denying
petitioner's motion for intervention. Said Resolution did not completely dispose of the case on the merits,
hence, it is merely an interlocutory order. As such, Section 1, Rule 41 of the Rules of Court provides that
no appeal may be taken therefrom. However, where the assailed interlocutory order is patently erroneous
and the remedy of appeal would not afford adequate and expeditious relief, the Court allows certiorari as a
mode of redress.5
In this case, the discussion below will show that the assailed Resolution is patently erroneous, and that
granting the Office of the Ombudsman the opportunity to be heard in the case pending before the lower
court is of primordial importance. Thus, the Court resolves to relax the application of procedural rules by
treating the petition as one for certiorari under Rule 65 of the Rules of Court.
The CA should have allowed the Office of the Ombudsman to intervene in the appeal pending with the
lower court. The wisdom of this course of action has been exhaustively explained in Office of the
Ombudsman v. Samaniego.6 In said case, the CA also issued a Resolution denying the Office of the
Ombudsman's motion to intervene. In resolving the issue of whether the Office of the Ombudsman has
legal interest to intervene in the appeal of its Decision, the Court expounded, thus:
x x x the Ombudsman is in a league of its own. It is different from other investigatory and prosecutory
agencies of the government because the people under its jurisdiction are public officials who, through
pressure and influence, can quash, delay or dismiss investigations directed against them. Its function is
critical because public interest (in the accountability of public officers and employees) is at stake.
xxxx
The Office of the Obudsman sufficiently alleged its legal interest in the subject matter of litigation.
Paragraph 2 of its motion for intervention and to admit the attached motion to recall writ of preliminary
injunction averred:
"2. As a competent disciplining body, the Ombudsman has the right to seek redress on the apparently
erroneous issuance by this Honorable Court of the Writ of Preliminary Injunction enjoining the
implementation of the Ombudsman's Joint Decision x x x."
In asserting that it was a "competent disciplining body," the Office of the Ombudsman correctly summed
up its legal interest in the matter in controversy. In support of its claim, it invoked its role as a
constitutionally mandated "protector of the people," a disciplinary authority vested with quasi-judicial
function to resolve administrative disciplinary cases against public officials. To hold otherwise would have
been tantamount to abdicating its salutary functions as the guardian of public trust and accountability.
Moreover, the Office of the Ombudsman had a clear legal interest in the inquiry into whether respondent
committed acts constituting grave misconduct, an offense punishable under the Uniform Rules in
Administrative Cases in the Civil Service. It was in keeping with its duty to act as a champion of the
people and preserve the integrity of public service that petitioner had to be given the opportunity to act
fully within the parameters of its authority.
It is true that under our rule on intervention, the allowance or disallowance of a motion to intervene is left
to the sound discretion of the court after a consideration of the appropriate circumstances. However, such
discretion is not without limitations. One of the limits in the exercise of such discretion is that it must not
be exercised in disregard of law and the Constitution. The CA should have considered the nature of the
Ombudsman's powers as provided in the Constitution and RA 6770.
xxxx
Both the CA and respondent likened the Office of the Ombudsman to a judge whose decision was in
question. This was a tad too simplistic (or perhaps even rather disdainful) of the power, duties and
functions of the Office of the Ombudsman. The Office of the Ombudsman cannot be detached,
disinterested and neutral specially when defending its decisions. Moreover, in administrative cases against
government personnel, the offense is committed against the government and public interest. What further
proof of a direct constitutional and legal interest in the accountability of public officers is necessary?7
Here, since its power to ensure enforcement of its Joint Decision and Supplemental Resolution is in danger
of being impaired, the Office of the Ombudsman had a clear legal interest in defending its right to have its
judgment carried out. The CA patently erred in denying the Office of the Ombudsman's motion for
intervention.
A discussion of the next issue of the propriety of the issuance of a writ of preliminary injunction in this
case would necessarily touch on the very merits of the case, i.e., whether the concerned government
agencies and instrumentalities may execute the Office of the Ombudsman's order to dismiss a government
employee from service even if the Ombudsman's decision is pending appeal. It would also be a great waste
of time to remand the case back to the CA, considering that the entire records of the proceedings have
already been elevated to this Court. Thus, at this point, the Court shall fully adjudicate the main issue in the
case.
Note that for a writ of preliminary injunction to issue, the following essential requisites must concur, to
wit: (1) that the invasion of the right is material and substantial; (2) that the right of complainant is clear
and unmistakable; and, (3) that there is an urgent and paramount necessity for the writ to prevent serious
damage.8 In the present case, the right of respondents cannot be said to be clear and unmistakable, because
the prevailing jurisprudence is that the penalty of dismissal from the service meted on government
employees or officials is immediately executory in accordance with the valid rule of execution pending
appeal uniformly observed in administrative disciplinary cases. In Facura v. Court of Appeals, 9 the Court
fully threshed out this matter, thus:
The issue of whether or not an appeal of the Ombudsman decision in an administrative case carries with it
the immediate suspension of the imposed penalty has been laid to rest in the recent resolution of the case of
Ombudsman v. Samaniego, where this Court held that the decision of the Ombudsman is immediately
executory pending appeal and may not be stayed by the filing of an appeal or the issuance of an injunctive
writ, to wit:
"Section 7, Rule III of the Rules of Procedure of the Office of the Ombudsman, as amended by
Administrative Order No. 17 dated September 15, 2003, provides:
SEC. 7. Finality and execution of decision. - Where the respondent is absolved of the charge, and in case of
conviction where the penalty imposed is public censure or reprimand, suspension of not more than one
month, or a fine equivalent to one month salary, the decision shall be final, executory and unappealable. In
all other cases, the decision may be appealed to the Court of Appeals on a verified petition for review
under the requirements and conditions set forth in Rule 43 of the Rules of Court, within fifteen (15) days
from receipt of the written Notice of the Decision or Order denying the motion for reconsideration.
An appeal shall not stop the decision from being executory. In case the penalty is suspension or removal
and the respondent wins such appeal, he shall be considered as having been under preventive suspension
and shall be paid the salary and such other emoluments that he did not receive by reason of the suspension
or removal.
A decision of the Office of the Ombudsman in administrative cases shall be executed as a matter of
course.1âwphi1 The Office of the Ombudsman shall ensure that the decision shall be strictly enforced and
properly implemented. The refusal or failure by any officer without just cause to comply with an order of
the Office of the Ombudsman to remove, suspend, demote, fine, or censure shall be a ground for
disciplinary action against such officer. [Emphases supplied]
The Ombudsman's decision imposing the penalty of suspension for one year is immediately executory
pending appeal. It cannot be stayed by the mere filing of an appeal to the CA. This rule is similar to that
provided under Section 47 of the Uniform Rules on Administrative Cases in the Civil Service.
In the case of In the Matter to Declare in Contempt of Court Hon. Simeon A. Datumanong, Secretary of
the DPWH, we held:
The Rules of Procedure of the Office of the Ombudsman are clearly procedural and no vested right of the
petitioner is violated as he is considered preventively suspended while his case is on appeal. Moreover, in
the event he wins on appeal, he shall be paid the salary and such other emoluments that he did not receive
by reason of the suspension or removal. Besides, there is no such thing as a vested interest in an office, or
even an absolute right to hold office. Excepting constitutional offices which provide for special immunity
as regards salary and tenure, no one can be said to have any vested right in an office.
xxxx
x x x Here, Section 7, Rule III of the Rules of Procedure of the Office of the Ombudsman, as amended, is
categorical, an appeal shall not stop the decision from being executory.
Moreover, Section 13 (8), Article XI of the Constitution authorizes the Office of the Ombudsman to
promulgate its own rules of procedure. In this connection, Sections 18 and 27 of the Ombudsman Act of
1989 also provide that the Office of the Ombudsman has the power to "promulgate its rules of procedure
for the effective exercise or performance of its powers, functions and duties" and to amend or modify its
rules as the interest of justice may require. For the CA to issue a preliminary injunction that will stay the
penalty imposed by the Ombudsman in an administrative case would be to encroach on the rule-making
powers of the Office of the Ombudsman under the Constitution and RA 6770 as the injunctive writ will
render nugatory the provisions of Section 7, Rule III of the Rules of Procedure of the Office of the
Ombudsman.
Clearly, Section 7, Rule III of the Rules of Procedure of the Office of the Ombudsman supersedes the
discretion given to the CA in Section 12, Rule 43 of the Rules of Court when a decision of the Ombudsman
in an administrative case is appealed to the CA. The provision in the Rules of Procedure of the Office of
the Ombudsman that a decision is immediately executory is a special rule that prevails over the provisions
of the Rules of Court. Specialis derogat generali. When two rules apply to a particular case, that which was
specially designed for the said case must prevail over the other. [Emphases supplied]
Thus, Section 7, Rule III of the Rules of Procedure of the Office of the Ombudsman, as amended by
Administrative Order (A.O.) No. 17, is categorical in providing that an appeal shall not stop an
Ombudsman decision from being executory. This rule applies to the appealable decisions of the
Ombudsman, namely, those where the penalty imposed is other than public censure or reprimand, or a
penalty of suspension of more than one month, or a fine equivalent to more than one month's salary.
Hence, the dismissal of De Jesus and Parungao from the government service is immediately executory
pending appeal.
The aforementioned Section 7 is also clear in providing that in case the penalty is removal and the
respondent wins his appeal, he shall be considered as having been under preventive suspension and shall be
paid the salary and such other emoluments that he did not receive by reason of the removal. As explained
above, there is no such thing as a vested interest in an office, or an absolute right to hold office, except
constitutional offices with special provisions on salary and tenure. The Rules of Procedure of the
Ombudsman being procedural, no vested right of De Jesus and Parungao would be violated as they would
be considered under preventive suspension, and entitled to the salary and emoluments they did not receive
in the event that they would win their appeal.
The ratiocination above also clarifies the application of Rule 43 of the Rules of Court in relation to Section
7 of the Rules of Procedure of the Office of the Ombudsman. The CA, even on terms it may deem just, has
no discretion to stay a decision of the Ombudsman, as such procedural matter is governed specifically by
the Rules of Procedure of the Office of the Ombudsman.
The CA's issuance of a preliminary mandatory injunction, staying the penalty of dismissal imposed by the
Ombudsman in this administrative case, is thus an encroachment on the rule-making powers of the
Ombudsman under Section 13 (8), Article XI of the Constitution, and Sections 18 and 27 of R.A. No.
6770, which grants the Office of the Ombudsman the authority to promulgate its own rules of procedure.
The issuance of an injunctive writ renders nugatory the provisions of Section 7, Rule III of the Rules of
Procedure of the Office of the Ombudsman.10
From the foregoing elaboration, there can be no cavil that respondents do not have any right to a stay of the
Ombudsman's decision dismissing them from service. Perforce, the BSU-BOR acted properly in issuing
Resolution No. 18, series of 2005, dated August 22, 2005, pursuant to the order of the Ombudsman, as its
legally-mandated duty. The CA's Resolution granting respondents' prayer for a writ of preliminary
injunction is patently erroneous.
WHEREFORE, the petition is GRANTED. The Resolution of the Court of Appeals, dated April 7, 2006, is
SET ASIDE. The Order of the Regional Trial Court of Batangas City, Branch 4, dated September 26, 2005
in Civil Case No. 7775, is REINSTATED.
SO ORDERED.
G.R. No. 185954 February 16, 2010 Regulations on Supplies and Property Management in Local Governments
(RRSPMLG). Moreover, the purchases were charged against the calamity fund,
despite absence of any declaration from the President that Samar was under a state
OFFICE OF THE OMBUDSMAN, Petitioner,
of calamity, in violation of Sec. 324(d) of R.A. 7160.
vs.
MAXIMO D. SISON, Respondent.
2. Inconsistencies in the dates of supporting documents relating to the purchases discussed in
finding No. 1 were so glaring that they raised doubts on the validity of the transactions per se;
DECISION

3. The use of the 5% budgetary reserves for calamity as funding source of emergency purchases
VELASCO, JR., J.:
was not legally established, there being no declaration from the Office of the President that
Samar was under a state of calamity, as required under Sec. 324(d) of R.A. 7160;
The Case
4. Splitting of requisitions and purchase orders was resorted to in violation of COA Circular No.
Before us is a Petition for Review on Certiorari under Rule 45 assailing and seeking to set aside the 76-41 dated July 30, 1976;
Resolution1dated December 18, 2008 of the Court of Appeals (CA) in CA-G.R. SP No. 96611, entitled
Maximo D. Sison v. Fr. Noel Labendia for Himself and in Representation of Isog Han Samar Movement,
5. There was overpricing in the purchase of rice, medicines, electric fans and cement in the
Diocese of Calbayog, Catbalogan, Samar. The CA Resolution denied petitioner Office of the
amount of PhP 580,000.00, PhP 322,760.00, PhP 341,040.00, and PhP 3.6 million, respectively.
Ombudsman’s Omnibus Motion for Intervention and to Admit Attached Motion for Reconsideration of the
An overpayment was also committed in the payments of cement in the amount of PhP
CA’s June 26, 2008 Decision.2
96,364.09;

The Facts
6. Other observations gathered corollary to the purchases made are the following:

On October 11, 2004, the Isog Han Samar Movement, represented by Fr. Noel Labendia of the Diocese of
a. Purchase Orders were not duly accomplished to include a complete description of
Calbayog, Catbalogan, Samar, filed a letter-complaint addressed to then Ombudsman, Hon. Simeon
the items to be purchased, the delivery date and the terms of payment, in violation of
Marcelo, accusing Governor Milagrosa T. Tan and other local public officials 3 of the Province of Samar,
the provisions of Section 74 and other corollary provisions of RRSPMLG. Some
including respondent Maximo D. Sison, of highly anomalous transactions entered into by them amounting
were even acknowledged by suppliers;
to several millions of pesos. Sison was the Provincial Budget Officer.

b. At least 36 vouchers/claims were not supported with an official receipt, in

The letter-complaint stemmed from the audit investigation dated August 13, 2004 conducted by the Legal
violation of the provisions of Section 4 of PD 1445 that all disbursements must be
and Adjudication Office (LAO), Commission on Audit (COA), which found, among others, that various
supported with complete documentation; and
purchases totaling PhP 29.34 million went without proper bidding procedures and documentations; that
calamity funds were expended without a State of Calamity having been declared by the President; and that
purchases for rice, medicines, electric fans, and cement were substantially overpriced. c. Advanced deliveries of medicines and assorted goods were made on some
purchases even before the purchase orders were prepared and before the public
biddings were conducted.
The Special Audit Team, which was created under LAO Office Order No. 2003-059 dated July 7, 2003,
summarized the corresponding COA audit findings and observations, to wit:
7. The necessity and veracity of the distribution of t-shirts/caps, medicines, assorted goods and
cement purchased by the Province of Samar could not be established due to rampant
1. Rules and regulations pertaining to procurement of supplies and materials were consciously
inconsistencies in dates, quantities, as well as the signatures of the alleged recipients in the
and continually violated as disclosed in the verification of selected purchases of the Province.
Requisition and Issue Slip; and,
Below were the findings and observations:

8. Financial Assistance (FA)/Assistance to Individuals in Crisis Situation (AICS) totaling at

a. Purchases of various items, totaling at least PhP 29.34 million and allegedly
least PhP 5.4 million in 2002 and PhP 2.78 million as of April 2003 were granted to various
procured through public bidding, were found highly irregular for lack of proper
applicant-recipients without subjecting them to the guidelines set forth by the Department of
bidding procedures and documentation;
Social Welfare and Development (DSWD).4 x x x

b. At least PhP 28.165 million worth of purchases through repeat orders were made
On January 24, 2005, the Office of the Ombudsman, through Director Jose T. De Jesus, Jr., found basis to
by the Province without observing the pertinent law, rules and regulations governing
proceed with the administrative case against the impleaded provincial officials of Samar, docketed as
this mode of procurement; and
OMB-C-A-05-0051-B. The latter were then required to file their counter-affidavits and countervailing
evidence against the complaint.
c. Emergency purchases of medicines and assorted goods totaling PhP 14.67 million
were found not complying with the requirements set forth under the Rules and
In his counter-affidavit, Sison vehemently denied the accusations contained in the letter-complaint and
claimed his innocence on the charges. He asserted that his function is limited to the issuance of a
certification that an appropriation for the requisition exists, that the corresponding amount has been
obligated, and that funds are available. He did not, in any way, vouch for the truthfulness of the
certification issued by the requesting parties. In addition, he averred that he never participated in the
alleged irregularities as shown in the minutes and attendance sheet of the bidding.
Further, he alleged that not one of the documentary evidences so far attached in the letter-complaint bore
his signature and that he was neither factually connected nor directly implicated in the complaint.
On May 6, 2005, Sison submitted his Position Paper to the Office of the Ombudsman and reiterated that he
had not participated in the alleged anomalous purchases and use of public funds by the Province of Samar.
On August 22, 2006, the Office of the Ombudsman rendered a Decision, finding Sison and several other
local officials of the Province of Samar guilty of grave misconduct, dishonesty, and conduct prejudicial to
the best interest of the service and dismissing him from service. The dispositive portion of the Decision
reads:
VIEWED IN THE FOREGOING LIGHT, DECISION is hereby rendered as follows:
1. Respondents ROLANDO B. MONTEJO, DAMIANO Z. CONDE, JR., ROMEO C.
REALES, MAXIMO D. SISON, AURELIO A. BARDAJE and NUMERIANO C. LEGASPI are FOUND
GUILTY of GRAVE MISCONDUCT, DISHONESTY and CONDUCT PREJUDICIAL TO THE BEST
INTEREST OF THE SERVICE, and are METED the penalty of DISMISSAL FROM SERVICE, and shall
carry with it the cancellation of eligibility, forfeiture of retirement benefits, and the perpetual
disqualification for re-employment in the government service.
Accordingly, Governor Milagrosa T. Tan and Executive Director Presentacion R. Montesa of the Bureau
of Local Government Finance, Department of Finance, are respectfully directed to implement this Order
upon receipt hereof and to forthwith inform the Office of compliance herewith.
2. The administrative complaint against respondents MILAGROSA T. TAN, FE ORTEGA TAN
ARCALES, SUSANO DIMAKILING SALURIO, BARTOLOME P. FIGUEROA, ANTONIO DE LEON
BOLASTIG, III, ROSENAIDA A. ROSALES and BARTOLOME R. CASTILLO III is DISMISSED in
view of their re-election in May 2004;
3. The administrative complaint against ERNESTO CARCILLAR ARCALES, FELIX T. BABALCON,
JR., JIMMY R. DY, JUAN COLINARES LATORRE, JR., MARIA LOURDES CORTEZ UY,
BIENVENIDA P. REPOL and RAMON P. DEAN, JR., who are no longer public officials, is
DISMISSED.
4. For insufficiency of evidence, the administrative complaint against ANAMIE P. MANATAD-NUNEZ
and ROSIE AMARO VILLACORTE is DISMISSED.
5. The Fact-Finding and Intelligence Office is DIRECTED to conduct further fact-finding investigations on
the following:
a. On DV Nos. 221-2002-12-083 and 221-2002-11-065: (a) to DETERMINE the other public
officials who may be held administratively liable; and (b) to FILE, if necessary, the
corresponding Complaint;
b. On Bid Nos. 079-2002, 442-2002, 554-2002, 861-2002, 937-2002, 947-2002, 1221-2002,
1375-2002, 1411-2002, 007-2003, 014-2003, 023-2003, 047-2003 and 082-2002: (a) to
VERIFY whether actual public biddings took place relative to the transactions covered by these
bids; (b) to CHECK the veracity of the documents relative to the repeat orders made; (c) to
DETERMINE the other public officials who may appear to be administratively liable therefor;
and (d) to FILE, if warranted, the corresponding Complaint; and
c. On Bid Nos. 078-2002, 448-2002, 931-2002, 1230-2001, 411-2002, 944-2002, 1244-2002,
1407-2001, 198-2002, 316-2002 and 431-2002: (a) to DETERMINE whether actual public
biddings were held relative to the above-mentioned transactions; (b) to CHECK the veracity of
the documents relative to the repeat orders made; (c) to ASCERTAIN the other public officials
who may be held administratively liable therefor; and (d) to FILE the corresponding Complaint,
if warranted.
Accordingly, let a copy of this Memorandum be furnished the Fact- Finding and Intelligence Office for its
appropriate action.
SO ORDERED.5 (Emphasis supplied.)
Aggrieved, Sison appealed to the CA via a Petition for Review under Rule 43, docketed as CA-G.R. SP
No. 96611.
On June 26, 2008, the CA rendered a decision reversing and setting aside the decision of the Office of the
Ombudsman against Sison. The fallo of the CA decision reads:
WHEREFORE, the decision of the Ombudsman dated 22 August 2006 in OMB-C-A-05-0051-B in so far
as it finds the herein petitioner MAXIMO D. SISON administratively liable for grave misconduct,
dishonesty and conduct prejudicial to the best interest of service is hereby REVERSED and SET ASIDE
for insufficiency of evidence. Accordingly, he is absolved from administrative liability as charged.
SO ORDERED.6
In ruling thus, the CA held that the Office of the Ombudsman failed to adduce substantial evidence in order
to convict Sison. Moreover, it reasoned that Sison’s responsibility as Provincial Budget Officer was to
ensure that appropriations exist in relation to the emergency purchase being made and that he had no hand
or discretion in characterizing a particular purchase as emergency in nature. Hence, he cannot be held
administratively liable for simply attesting to the existence of appropriations for a certain purpose, save if
such certification is proved to be false.
On July 22, 2008, the Office of the Ombudsman filed an Omnibus Motion for Intervention and to Admit
Attached Motion for Reconsideration, which was subsequently denied by the CA in its assailed resolution
of December 18, 2008.
Hence, we have this petition.
The Issues
I
Whether the [CA] gravely erred in denying petitioner’s right to intervene in the proceedings, considering
that (a) the Office of the Ombudsman has sufficient legal interest warranting its intervention in the
proceedings before the [CA] since it rendered the subject decision pursuant to its administrative authority
over public officials and employees; and (b) contrary to the appellate court a quo’s ruling, petitioner Office
of the Ombudsman filed its Omnibus Motion to Intervene and to Admit Attached Motion for
Reconsideration on a patently erroneous decision of the [CA] which has not yet attained finality.
II
Whether the [CA] erred in ruling that the finding of the Office of the Ombudsman was not supported by
substantial evidence.
III
Whether the [CA] erred in giving due course to respondent’s petition for review when this was prematurely
filed as it disregarded the well-entrenched jurisprudential doctrine of exhaustion of administrative
remedies.
Our Ruling
The appeal lacks merit.
Intervention Is Discretionary upon the Court
The pivotal issue in this case is whether the Office of the Ombudsman may be allowed to intervene and
seek reconsideration of the adverse decision rendered by the CA.
In its Decision, the CA did not allow the Office of the Ombudsman to intervene, because (1) the Office of
the Ombudsman is not a third party who has a legal interest in the administrative case against petitioner;
(2) the Omnibus Motion for Intervention was filed after the CA rendered its Decision; and (3) the Office of
the Ombudsman was the quasi-judicial body which rendered the impugned decision.
In its Petition, however, the Office of the Ombudsman asserts that it has sufficient legal interest to warrant
its intervention in the proceedings, since it rendered the subject decision pursuant to its administrative
authority over public officials and employees. Further, it contends that the Omnibus Motion to Intervene
was timely filed, since, at the time of its filing, the decision of the CA had not yet attained finality.
We are not persuaded.
It is fundamental that the allowance or disallowance of a Motion to Intervene is addressed to the sound
discretion of the court.7 The permissive tenor of the rules shows the intention to give to the court the full
measure of discretion in permitting or disallowing the intervention, 8 thus:
SECTION 1. Who may intervene. – A person who has a legal interest in the matter in litigation, or in the
success of either of the parties, or an interest against both, or is so situated as to be adversely affected by a
distribution or other disposition of property in the custody of the court or of an officer thereof may, with
leave of court, be allowed to intervene in the action. The court shall consider whether or not the
intervention will unduly delay or prejudice the adjudication of the rights of the original parties, and
whether or not the intervenor’s rights may be fully protected in a separate proceeding.
SECTION 2. Time to intervene. – The motion to intervene may be filed at any time before rendition of
judgment by the trial court. A copy of the pleading-in-intervention shall be attached to the motion and
served on the original parties.9 (Emphasis supplied.)
Simply, intervention is a procedure by which third persons, not originally parties to the suit but claiming an
interest in the subject matter, come into the case in order to protect their right or interpose their claim. 10 Its
main purpose is to settle in one action and by a single judgment all conflicting claims of, or the whole
controversy among, the persons involved.11
To warrant intervention under Rule 19 of the Rules of Court, two requisites must concur: (1) the movant
has a legal interest in the matter in litigation; and (2) intervention must not unduly delay or prejudice the
adjudication of the rights of the parties, nor should the claim of the intervenor be capable of being properly
decided in a separate proceeding. The interest, which entitles one to intervene, must involve the matter in
litigation and of such direct and immediate character that the intervenor will either gain or lose by the
direct legal operation and effect of the judgment.12
In support of its argument that it has legal interest, the Office of the Ombudsman cites Philippine National
Bank v. Garcia, Jr. (Garcia). 13 In the said case, the Philippine National Bank (PNB) imposed upon its
employee, Garcia, the penalty of forced resignation for gross neglect of duty. On appeal, the Civil Service
Commission (CSC) exonerated Garcia from the administrative charges against him. In accordance with the
ruling in Civil Service Commission v. Dacoycoy,14 this Court affirmed the standing of the PNB to appeal
to the CA the CSC resolution exonerating Garcia. After all, PNB was the aggrieved party which
complained of Garcia’s acts of dishonesty. Should Garcia be finally exonerated, it might then be incumbent
upon PNB to take him back into its fold. PNB should, therefore, be allowed to appeal a decision that, in its
view, hampered its right to select honest and trustworthy employees, so that it can protect and preserve its
name as a premier banking institution in the country.1avvphi1
Based on the facts above, the Office of the Ombudsman cannot use Garcia to support its intervention in the
appellate court for the following reasons:
First, Sison was not exonerated from the administrative charges against him, and was, in fact, dismissed for
grave misconduct, dishonesty, and conduct prejudicial to the best interest of the service by the Office of the
Ombudsman in the administrative case, OMB-C-A-05-0051-B. Thus, it was Sison who appealed to the CA
being, unquestionably, the party aggrieved by the judgment on appeal.
Second, the issue here is the right of the Office of the Ombudsman to intervene in the appeal of its
decision, not its right to appeal.
And third, Garcia should be read along with Mathay, Jr. v. Court of Appeals 15 and National Appellate
Board of the National Police Commission v. Mamauag (Mamauag),16 in which this Court qualified and
clarified the exercise of the right of a government agency to actively participate in the appeal of decisions
in administrative cases. In Mamauag, this Court ruled:
RA 6975 itself does not authorize a private complainant to appeal a decision of the disciplining authority.
Sections 43 and 45 of RA 6975 authorize ‘either party’ to appeal in the instances that the law allows
appeal. One party is the PNP member-respondent when the disciplining authority imposes the penalty of
demotion or dismissal from the service. The other party is the government when the disciplining authority
imposes the penalty of demotion but the government believes that dismissal from the service is the proper
penalty.
However, the government party that can appeal is not the disciplining authority or tribunal which
previously heard the case and imposed the penalty of demotion or dismissal from the service. The
government party appealing must be the one that is prosecuting the administrative case against the
respondent. Otherwise, an anomalous situation will result where the disciplining authority or tribunal
hearing the case, instead of being impartial and detached, becomes an active participant in prosecuting the
respondent. Thus, in Mathay, Jr. v. Court of Appeals, decided after Dacoycoy, the Court declared:
To be sure when the resolutions of the Civil Service Commission were brought to the Court of Appeals, the
Civil Service Commission was included only as a nominal party. As a quasi-judicial body, the Civil
Service Commission can be likened to a judge who should "detach himself from cases where his decision
is appealed to a higher court for review."
Therefore, the Office of the Ombudsman does not have the legal interest to intervene. As the CA held
correctly:
The Office of the Ombudsman is not a third party who has a legal interest in the administrative case against
the petitioner such that it would be directly affected by the judgment that this Court had rendered. It must
be remembered that the legal interest required for an intervention must be direct and immediate in
character. Lest it be forgotten, what was brought on appeal before this Court is the very Decision by the
Office of the Ombudsman. Plainly, the Office of the Ombudsman, as an adjudicator, and not an advocate,
has no legal interest at stake in the outcome of this Rule 43 Petition. 21

In instituting G.R. No. 126354, the Civil Service Commission dangerously departed from its role as Motion for Intervention Was Not Filed on Time
adjudicator and became an advocate. Its mandated function is to "hear and decide administrative cases
instituted by or brought before it directly or on appeal, including contested appointments and to review
Furthermore, the Rules provides explicitly that a motion to intervene may be filed at any time before
decisions and actions of its offices and agencies," not to litigate.
rendition of judgment by the trial court. In the instant case, the Omnibus Motion for Intervention was filed
only on July 22, 2008, after the Decision of the CA was promulgated on June 26, 2008.
Clearly, the Office of the Ombudsman is not an appropriate party to intervene in the instant case. It must
remain partial and detached. More importantly, it must be mindful of its role as an adjudicator, not an
In support of its position, petitioner cites Office of the Ombudsman v. Samaniego. 22 That case, however, is
advocate.
not applicable here, since the Office of the Ombudsman filed the motion for intervention during the
pendency of the proceedings before the CA.
It is an established doctrine that judges should detach themselves from cases where their decisions are
appealed to a higher court for review. The raison d’etre for such a doctrine is the fact that judges are not
It should be noted that the Office of the Ombudsman was aware of the appeal filed by Sison. The Rules of
active combatants in such proceeding and must leave the opposing parties to contend their individual
Court provides that the appeal shall be taken by filing a verified petition for review with the CA, with
positions and the appellate court to decide the issues without the judges’ active participation. 17 When
proof of service of a copy on the court or agency a quo. 23 Clearly, the Office of the Ombudsman had
judges actively participate in the appeal of their judgment, they, in a way, cease to be judicial and have
sufficient time within which to file a motion to intervene. As such, its failure to do so should not now be
become adversarial instead.18
countenanced. The Office of the Ombudsman is expected to be an "activist watchman," not merely a
passive onlooker.24
In Pleyto v. Philippine National Police Criminal Investigation and Detection Group (PNP-CIDG),19 the
Court applied this doctrine when it held that the CA erred in granting the Motion to Intervene filed by the
In this case, it cannot be denied that the Omnibus Motion for Intervention was belatedly filed. As we held
Office of the Ombudsman, to wit:
in Rockland Construction Co., Inc. v. Singzon, Jr., no intervention is permitted after a decision has already
been rendered.25
The court or the quasi-judicial agency must be detached and impartial, not only when hearing and
resolving the case before it, but even when its judgment is brought on appeal before a higher court. The
In light of the foregoing considerations, all other issues raised in the petition are rendered moot and
judge of a court or the officer of a quasi-judicial agency must keep in mind that he is an adjudicator who
academic and no further discussion is necessary.
must settle the controversies between parties in accordance with the evidence and applicable laws,
regulations and/or jurisprudence. His judgment should already clearly and completely state his findings of
fact and law. There must be no more need for him to justify further his judgment when it is appealed before WHEREFORE, the petition is DENIED. The CA Resolution dated December 18, 2008 in CA-G.R. SP No.
appellate courts. When the court judge or the quasi-judicial officer intervenes as a party in the appealed 96611 is AFFIRMED.
case, he inevitably forsakes his detachment and impartiality, and his interest in the case becomes personal
since his objective now is no longer only to settle the controversy between the original parties (which he
SO ORDERED.
had already accomplished by rendering his judgment), but more significantly, to refute the appellant’s
assignment of errors, defend his judgment, and prevent it from being overturned on appeal.

Likewise, the facts reveal that this case was elevated to the CA via a verified Petition for Review under
Rule 43 of the Rules of Court and Supreme Court Administrative Circular No. 1-95 dated May 16, 1995,
which govern appeals to the CA from judgments or final orders of quasi-judicial agencies.

Rule 43, as well as Administrative Circular No. 1-95, provides that the petition for review shall state the
full names of the parties to the case without impleading the court or agencies either as petitioners or
respondents.20 Thus, the only parties in such an appeal are the appellant as petitioner and appellee as
respondent. The court or, in this case, the administrative agency that rendered the judgment appealed from,
is not a party in the said appeal.
G.R. No. 193809
SATURNINO NOVECIO, GAVINO NOVECIO, ANASTACIO GOLEZ, ABUNDIO SOMBILON,
BERTING RODRIGUEZ, MELITON CATALAN, Petitioners,
vs.
HON. RODRIGO F. LIM, JR., as Chairman, HON. LEONCIA R. DIMAGIBA as ponente and as
member and HON. ANGELITA A. GACUTAN as member, former Twenty-Third Division, COURT
OF APPEALS, Mindanao Station, HON. JUDGE BENJAMIN ESTRADA, in his capacity as
Presiding Judge of Branch 9, RTC, Malaybalay, Bukidnon, MARIA CARMEN J. TUAZON, rep. by
her Attorney-in-fact, LOPE DUROTAN,Respondents.
The petitioners, on the other hand, contended that they have already been in possession of the land for
more than two years when the complaints were filed.1âwphi1 They maintained that they have planted the
land with com, durian, coconut, mango, jackfruit, rambutan, etc. for their livelihood. They also alleged that
they were harassed by some men armed with shotguns and pistols on February 12, 2004. 6
The petitioners further maintained that Manuel V. Nieto, father of Maria Carmen J. Tuazon, had previous
landholding in the area but the same was covered by the Comprehensive Agrarian Reform Program
(CARP) and so it was subdivided in favor of the tenants.7 The MTC's Ruling
The MTC ruled in favor the petitioners.8

x-----------------------x
The MTC found that the respondents anchored their alleged prior possession on the fact that they have
applied title for the land as shown by a certification authorizing land survey. 9 Other than this, the
VERGELIO ROSALES, LUIS TEQUILIO, GREGORIO PANANGIN, JOSEPH RODRIQUEZ, respondents had no evidence of their actual and physical possession of the land. The MTC also found that
EDDIE RODRIGUEZPetitioners, they were not even residents of the place and never personally appeared in court during trial.
vs.
HON. RODRIGO F. LIM, JR., as Chairman, HON. LEONCIA R. DIMAGIBA as ponente and as
The petitioners, on the other hand, claimed their prior possession on the fact that their livelihood as fisher
member and HON. ANGELITA A. GACUTAN as member, former Twenty-Third Division, COURT
folks and farmers require them to live by the riverbank where the land is located. The petitioners also
OF APPEALS, Mindanao Station, HON. JUDGE BENJAMIN ESTRADA, in his capacity as
asserted that they have been occupying the land for more than two (2) years when the complaints were
Presiding Judge of Branch 9, RTC, Malaybalay, Bukidnon, MANUEL V. NIETO, rep. by his
filed. The MTC held that the certification issued by the barangay captain that the petitioners are residents
Attorney-in-fact, LOPE DUROTAN, Respondents.
of the place is a very strong evidence of their prior physical possession. 10

DECISION
The MTC concluded: "[a]s between a resident and a non-resident the likelihood is that the resident has the
prior physical possession because of his accessibility to the area."11
BRION, J.:
The dispositive portion of the MTC decision reads:
We resolve the petition for certiorari1 filed under Rule 65 of the Rules of Court with prayer for the
issuance of a temporary restraining order and/or writ of preliminary injunction. The petition assails the
WHEREFORE, by preponderance of evidence showing defendants' prior physical possession of the land
resolutions2 dated January 28, 2010 and July 16, 2010 of the Court of Appeals (CA) in CA- G.R. SP No.
and the filing of the complaint beyond the one-year period[,] judgment is rendered in favor of the
02863.
defendants DISMISSINGthe cases.12

The assailed resolutions denied the petitioners' prayer for the issuance of a preliminary injunction pending
The respondents appealed the MTC decision to the RTC.
resolution of the Petition for Review filed in the CA. The subject of the Petition for Review was the
consolidated decision of the Regional Trial Court (RTC), Branch 9, Malaybalay, Bukidnon, which reversed
the decision of the Municipal Trial Court (MTC) of Quezon, Bukidnon. The MTC dismissed the forcible The RTC's Ruling
entry cases filed by the respondents against the petitioners.
The RTC reversed the MTC decision.13
On October 18, 2010, this Court issued a Temporary Restraining Order (TRO) enjoining the RTC from
executing its consolidated decision.3
The RTC held that the MTC ignored some pieces of evidence, warranting the reversal of the decision.

The Factual Antecedents

Respondents Maria Carmen J. Tuazon and Manuel V. Nieto, represented by their attorney-in-fact, Lope
Durotan (the respondents), filed complaints4 for forcible entry with damages against petitioners Satumino
Novecio, Gavino Novecio, Anastacio Golez, et al. (the petitioners).5
The respondents alleged that on February 15, 2004, the petitioners, by force, intimidation, threat, strategy
and stealth, unlawfully squatted and took possession of several portions of land with an area of eight (8)
hectares, described as Project No. 9, Block 1, LC Map No. 777. The petitioners allegedly planted crops,
erected makeshift shelters, and continue to plant and /or improve the shelters as of the filing of the
complaints for forcible entry, all without the consent and/or against the will of the respondents.
The RTC ruled that the MTC should have given credence to the certification issued by the Department of
Environment and Natural Resources - Community Environment and Natural Resources Office (DENR-
CENRO) showing that the land in litigation is the subject of an application for title and claim by the
respondents. The RTC also took judicial notice of the request for authority to conduct a survey over the
subject property, which provides that "the parcel of land herein treated was an unsurveyed land and
Manuel V. Nieto was the identified occupant and tiller of the land."14
In view of these, the RTC ruled that the respondents were the actual occupants of the property in litigation
long before the petitioners had taken possession of the same property. The RTC ordered the petitioners'
ejectment.
The dispositive portion of the RTC decision reads: The Court's Ruling

WHEREFORE, premises considered and finding the appeal to be with merit, the assailed Consolidated We find the petition meritorious.
Decision dated November 7, 2005 of the Municipal Trial Court of Quezon, Bukidnon is hereby reversed
and set aside, finding in favor of plaintiff-appellants, ordering the ejectment of all defendants-appellees and
We note at the outset that the petition merely assails the interlocutory orders of the CA. Thus, the remedy
"John Does" in both cases and for them to turn over peaceful possession/occupancy of the landholding in
of certiorari under Rule 65 is appropriate as the assailed resolutions are not appealable and there is no
litigation. No pronouncement as to costs.15
plain, speedy or adequate remedy in the ordinary course oflaw. 21

The Proceedings before the CA

Our decision in this case is without prejudice to the Petition for Review pending in the CA. Our judgment
is limited to the resolutions of the CA denying the prayer for the issuance of a preliminary injunction.
16
The petitioners filed on April 30, 2009 a Petition for Review with the CA - Mindanao Station, assailing
the judgment of the RTC.
Subject to this clarification, we find that the CA committed grave abuse of discretion when it denied the
injunctive relief prayed for by the petitioners.
As the respondents sought the execution of the RTC judgment, the petitioners filed on May 14, 2010 an
Extremely Urgent Application for Writ of Preliminary Injunction and Immediate Issuance of Temporary
There is grave abuse of discretion when an act is (1) done contrary to the Constitution, the law or
Restraining Order.17
jurisprudence or(2) executed whimsically, capriciously or arbitrarily, out of malice, ill will or personal
bias.22
On July 13, 2009, the CA issued a TRO effective for sixty (60) days. Meanwhile, the CA directed the
parties to submit their memoranda and position papers.
We quote the assailed CA resolutions.

On January 28, 2010, the CA issued the first assailed resolution denying the petitioners' application for
The January 28, 2010 Resolution states:
preliminary injunction.18 The CA, without necessarily resolving the petition on the merits, held that the
petitioners were not entitled to the relief demanded under Rule 58 of the Rules of Court. The petitioners'
Motion for Reconsideration was denied on July 16, 2010. Without necessarily resolving the instant petition on the merits, We find [the] petitioners not entitled to the
relief demanded under Rule 58 of the Revised Rules of Procedure. Thus, [the] petitioners' application for
the issuance of [a] Writ of Preliminary Injunction is hereby DENIED.
The Petition

The July 16, 2010 Resolution reads:

The petitioners impute grave abuse of discretion on the CA in denying their prayer for injunction pending
resolution of the Petition for Review.
Upon careful evaluation of [the] petitioners' Motion, We find no cogent and compelling reasons to warrant
reversal of Our Resolution. The arguments raised by [the] petitioners were mere reiteration and already
The petitioners argue that the CA denied their prayer for preliminary injunction despite the pressing need
considered and passed upon by this Court in denying [the] petitioners' application for issuance of the Writ
for it to prevent grave and irreparable injury to them. They emphasize that the records clearly show that
of Preliminary Injunction.
they were the prior possessors of the subject lot. In fact, the lot has been their home and source of
livelihood for several years prior to the institution of the forcible entry cases.
A review of the records, however, shows that the CA ignored relevant facts that would have justified the
issuance of a preliminary injunction. Contrary to established jurisprudence, the CA also denied the prayer
The respondents filed their comment19 on December 3, 2010. They argue that grave abuse of discretion
for preliminary injunction without giving the factual and legal bases for such · denial.
means such capricious and whimsical exercise of judgment equivalent to lack of jurisdiction. Mere abuse
of discretion, according to the respondents, is not enough. The respondents maintain that the petitioners are
not entitled to the injunctive relief since they have not established a clear legal right for its issuance. Section 3, Rule 58 of the Rules of Court provides that a preliminary injunction may be granted when the
following have been established:
This Court, acting on the petitioners' prayer, issued a TRO on October 18, 2010, enjoining the RTC
from executing its decision. The TRO remains effective until this day. i. That the applicant is entitled to the relief demanded, and the whole or part of such relief
consist in restraining the commission or continuance of the act or acts complained of, or in
requiring the performance of an act or acts, either for a limited period or perpetually;
Finally, it appears that the CA has yet to issue a decision on the Petition for Review. 20

ii. That the commission, continuance or non-performance of the act or acts complained of
The Issue
during the litigation would probably work injustice to the applicant; or

The sole issue is whether or not the CA acted with grave abuse of discretion, amounting to lack or excess
iii. That a party, court, agency or a person is doing, threatening, or is attempting to do, or is
of jurisdiction, when it denied the petitioners' prayer for preliminary injunction.
procuring or suffering to be done some act or acts probably in violation of the rights of the
 applicant respecting the subject of the action or proceeding, and tending to render the judgment
ineffectual.
A preliminary injunction is proper when the plaintiff appears to be clearly entitled to the relief sought and
has substantial interest in the right sought to be defended. As this Court has previously ruled, "while the
existence of the right need not be conclusively established, it must be clear." 23
A writ of preliminary injunction is generally based solely on initial or incomplete evidence. Such evidence
need only be a sampling intended merely to give the court an evidence of justification for a preliminary
injunction pending the decision on the merits of the case, and is not conclusive of the principal action
which has yet to be decided.24
In a prayer for preliminary injunction, the plaintiff is not required to submit conclusive and
complete evidence. He is only required to show that he has an ostensible right to the final relief
prayed for in his complaint.25
In this case, the petitioners have adequately shown their entitlement to a preliminary injunction. First, the
relief demanded consists in restraining the execution of the RTC decision ordering their ejectment from the
disputed land. Second, their ejectment from the land from which they derive their source of livelihood
would work injustice to the petitioners. Finally, the execution of the RTC decision is probably in violation
of the rights of the petitioners, tending to render the MTC judgment dismissing the forcible cases entry
ineffectual.
Moreover, the court in granting or dismissing an application for a writ of preliminary injunction based on
the pleadings of the parties and their respective evidence must state in its order the findings and
conclusions based on the evidence and the law. This is to enable the appellate court to determine whether
the trial court committed grave abuse of its discretion amounting to excess or lack of jurisdiction in
resolving, one way or the other, the plea for injunctive relief.26
Thus, we do not understand why the CA denied the prayer for preliminary injunction without citing any
legal or factual basis for the denial. The CA resolution provides: "[We] find [the] petitioners not entitled to
the relief demanded under Rule 58 of the Revised Rules of Civil Procedure."
Neither does the resolution denying the petitioners' Motion for Reconsideration contain any factual and
legal bases for the denial. It only provides that "[u]pon careful evaluation of the petitioners' Motion, We
find no cogent and compelling reasons to warrant reversal of Our Resolution."
We therefore have no idea why and how the CA came to the conclusion that the petitioners are not entitled
to the injunctive relief. Hence, we are forced to go beyond the function of a certiorari under Rule 65 and
examine the factual findings of the MTC and the RTC.
The MTC found that the petitioners have been in actual and physical possession of the land for more than
two (2) years prior to the institution of the complaints for forcible entry. 27 The MTC also found that the
respondents were not even sure how the petitioners entered the land. In their complaints, they alleged that
petitioners entered the land by means of "force, intimidation, threat, stealth and strategy," a shotgun
allegation which shows that respondents' lack knowledge of how the petitioners entered the disputed
property.
We quote the MTC decision with approval, viz:
xx x Force, intimidation[,] and threat usually connote actual knowledge of dispossession. One cannot
force, intimidate or threaten another who is not around.1âwphi1 In stealth and strategy[,] the actual entry is
usually done without the knowledge of the plaintiff. If they are not sure how [the] defendants entered the
land[,] the likelihood is that they also do not know when [the] defendant[s] entered the land. The court is
apt to believe that [the] defendants have been in possession of the land for more than 2 years. And under
Rule 70[,] the action of forcible entry must be filed within one year from dispossession. The filing of these
cases was beyond the one-year period.28
The RTC, on the other hand, relied on a mere request for authority to conduct a land survey, allegedly
showing that respondent Manuel V. Nieto was the occupant and tiller of the land.
However, this document does not prove prior possession of the subject land. It only points to the fact that
there was an application for a land title in the name of one of the respondents, which application was not
even shown to have been granted. This document merely authorized the survey of the land; the declaration
regarding possession was just incidental to the application for land survey.1âwphi1
Between the clear findings of the MTC, which conducted the trial of the forcible entry cases, and the RTC
acting as an appellate court, which relied on documentary evidence but without sufficiently explaining how
such evidence would prove prior possession, we are inclined to give weight to the MTC' s ruling.
This Court has held:
xxx The Court generally recognizes the profundity of conclusions and findings of facts reached by the trial
court and hence sustains them on appeal except for strong and cogent reasons inasmuch as the trial court is
in a better position to examine real evidence and observe the demeanor of witnesses in a case. No clear
specific contrary evidence was cited by the respondent appellate court to justify the reversal of the lower
court's findings. Thus, in this case, between the factual findings of the trial court and the appellate court,
those of the trial court must prevail over that of the latter.29
Under this factual backdrop, we conclude that the CA committed grave abuse of discretion when it denied
the prayer for preliminary injunction without explanation and justification.
We ought to remember that the grant of preliminary injunction would have only been provisional and
would not be conclusively determinative of the principal action. The issuance of the writ would have
served its purpose, i.e., to preserve the status quo or to prevent future wrongs in order to preserve and
protect the interests of the petitioners during the pendency of the action. 30
WHEREFORE, in view of the foregoing, we GRANT the writ of certiorari and accordingly SET
ASIDE the resolutions of the Court of Appeals dated January 28, 2010 and July 16, 2010 for grave abuse
of discretion.
SO ORDERED.
G.R. No. 205875 June 30, 2015 • 1900 - 1910.MHz

LIBERTY BROADCASTING NETWORK, INC., now known as WI-TRIBE TELECOMS, • 1980-1990 MHz
INC., Petitioner,
vs.
• 2400 - 2483 MHz
ATLOCOM WIRELESS SYSTEM, INC., Respondent.

• 2500 - 2700 MHz

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

• 3400-3600 MHz
G.R. No. 208916

• 5150-5350 MHz
NATIONAL TELECOMMUNICATIONS COMMISSION, Petitioner,
vs.
ATLOCOM WIRELESS SYSTEM, INC., Respondent. • 5470-5850 MHz

DECISION • 10150 - 10650 MHz

VILLARAMA, JR., J.:
The consolidated petitions before us assail the Decision1 dated June 29, 2012 and Resolution2 dated
February 18, 2013 of the Court of Appeals (CA) in CA-G.R. SP No. 119868. The CA reversed and set
aside the Orders3dated December 9, 2010 and March 21, 2011 of the Regional Trial Court (RTC) of
Quezon City, Branch 95 denying the application for a writ of Prohibitory or mandatory injunction in Civil
Case No. Q-09-65566.
Antecedent Facts
On December 23, 2008, NTC denied Atlocom's motion for extension of PA, citing the re-allocation of
MMDS frequencies for Broadband Wireless Access in accordance with MC 06-08-2005 and the
unavailability of other alternative frequencies.12
On September 8, 2009, Atlocom filed in the RTC a Petition13 to enjoin the implementation of MC 06-08-
2005 and reinstate the frequencies of Atlocom. It was further prayed that after hearing the court render
judgment declaring the said issuance as null and void because NTC unlawfully deprived Atlocom of the
right to its assigned frequencies without notice and hearing. The case was docketed as Civil Case No. Q-
09-65566.

Liberty Broadcasting Network, Inc. (LBNI), also a grantee of a legislative franchise (R.A. No. 1553, as
Atlocom Wireless System, Inc. (Atlocom) is a grantee of a legislative franchise under Republic Act (R.A.)
amended by R.A. No. 4154) for radio and television broadcasting, as well as radio stations for international
No. 8605.4On October 8, 2003, the National Telecommunications Commission (NTC) issued an Order 5 in
and domestic communications of all types and services, and holder of a Certificate of Public Convenience
NTC Case No. 98-158 relative to the application of Atlocom for a Certificate of Public Convenience
and Necessity (CPCN) to operate a radio communications network, was allowed to intervene in the case,
(CPC), as follows:
joining the defendant NTC in opposing Atlocom's claims. Pursuant to MC 06-08-2005, frequency bands
2535-2545 MHz and 2565-2595 MHz were re-allocated and assigned to LBNI, which covered the 2572-
WHEREFORE, it appearing that applicant is financially and technically capable of undertaking the 2596 MHz being claimed by Atlocom as allegedly assigned to it.
proposed project and that the operation thereof will promote the interest of the people in Metro Manila, in a
proper and suitable manner, the Commission hereby grants to herein applicant ATLOCOM WIRELESS
Per Certification14 dated October 22, 2003 issued by Alvin N. Blanco, Chief, Broadcast Services Division
SYSTEM, INC. a Provisional Authority (PA) to install, operate and maintain a Multi-Point Multi-Channel
of NTC, the following frequencies were "identified" for Atlocom's MMDS (Metro Manila) system: -
Distribution System [MMDS] in METRO MANILA, subject to the assignment of frequency by the
Frequency Management Division of t his Commission and to the following –CONDITIONS
C3 2572 - 2578 Mhz
As stated in the above order, the PA shall be valid for a period of eighteen (18)months, or until April 8,
2005. In a letter7 dated April 5, 2004, Atlocom thru its counsel requested for "an extension of time of the D3 2578 - 2584 Mhz
allocation of the above-enumerated frequencies and for the period for the construction and installation of
the radio stations in the condition no. 2 of the Order." Earlier, Atlocom filed an Application for Permit to
Import8 the necessary equipment. Atlocom followed up its application for extension of PA through a C4 2584 - 2590 Mhz
letter9 dated June 2, 2005 addressed to Deputy Commissioner Jorge V. Sarmiento. Subsequently, Atlocom
filed a Motion for Extension of Provisional Authority10 in NTC Case No. 98-158 on March 3, 2005. On D4 2590 - 2596 Mhz
August 23, 2005, NTC issued Memorandum Circular No. (MC) 06-08-200511 re-allocating the following
bands for broadband wireless access for fixed, nomadic and mobile networks:
On December 9, 2010, the RTC, after due hearing, issued an Order denying Atlocom's application for a
writ of preliminary prohibitory or mandatory injunction. Atlocom filed a motion for reconsideration but it
• 450-470 Mhz was likewise denied by the RTC under Order dated March 21, 2011.
In a petition for certiorari filed before the CA, Atlocom questioned the validity of the aforesaid orders of
the RTC.
In its Resolution15 dated August 12, 2011, the CA denied Atlocom's prayer for the issuance of a writ of
preliminary prohibitory injunction and its alternative prayer for a provisional mandatory injunction.
However, in its Decision dated June 29, 2012, the CA ruled in favor of Atlocom and reversed the RTC's
denial of application for preliminary injunction. The fallo of the decision reads:
WHEREFORE, premises considered, the petition is GRANTED.
The assailed Orders dated December 9, 2010 and March 21, 2011 of the
Regional Trial Court (RTC) of Quezon City,. Branch 95 are hereby REVERSED and SET ASIDE. The
plea for the issuance of a Preliminary Prohibitory Injunction is GRANTED. Let therefore a writ of
preliminary prohibitory injunction issue enjoining Respondent NTC from il_I1plementing Memorandum
Circular No. 06-08-2005, insofar as the frequencies ranging from 2572-2596 Mhz are concerned and for its
Co-Respondent LBNI from using the said frequencies during the pendency of Civil Case No. Q-09-65566
pending before Branch 95 of the Regional Trial Court of Quezon City upon the posting of a bond in the
amount of Php 200,000.00 to answer for all damages which they may sustain by reason of the injunction if
the RTC should finally decide that petitioner is not entitled thereto. The alternative plea for a writ of
Preliminary Mandatory Injunction is DENIED.
SO ORDERED.16
LBNI filed a Motion for Reconsideration with Ad Cautelam Offer to File Counter-Bond and Addendum to
Motion for Reconsideration with Ad Cautelam Offer to File Counter-Bond. NTC also filed a Motion for
Reconsideration and Supplemental Motion for Reconsideration. The CA denied these motions.
LBNI filed its petition (G.R. No. 205875) in this Court on April 22, 2013. Acting on LBNI's motion for the
issuance of a temporary restraining order (TRO) and/or writ of preliminary injunction, we issued a TRO
enjoining the implementation of the writ of preliminary injunction issued by the CA, conditioned upon
LBNI's posting of a cash bond in the sum of ₱300,000.00.
On April 18, 2013, NTC filed its separate petition (G.R. No. 208916) for review from the same CA
Decision and Resolution. We ordered the consolidation of the two cases as they arose from the same
factual setting, involve the same parties and raise identical issues.
Issues
The main issues to be resolved are: (1) whether Atlocom complied with the requisites for issuance of a writ
of preliminary injunction; and (2) whether LBNI's motion to file counter-bond was correctly denied by the
CA.
Specifically, LBNI asserts that the CA erred: (1) in finding that the NTC did not observe due process when
it issued MC 06-08-2005 and basing such conclusion on a mistaken notion that the grant of PA is
tantamount to a frequency assignment; (2) in failing to recognize that Atlocom has not sufficiently
established its claim that it had been assigned the 2572-2596 frequency bands by the NTC; (3) in granting
the provisional injunctive writ that in effect pre-judged the civil case pending in the RTC; and (4) in
denying LBNI's motion to file counter-bond on the basis of a technical conclusion it is not qualified to
make in the first place.
NTC faults the CA in finding that Atlocom's right to due process was violated because it was not notified
of the hearing prior to the issuance of MC 06-08-2005, and concluding that Atlocom has a clear and
unmistakable property right over the 2572-2596 frequency range.
Our Ruling
The petitions are meritorious.
A preliminary injunction is defined as "[a]n order granted at any stage of an action prior to the judgment or
final order, requiring a party or a court, agency or a person to refrain from a particular act or acts." 17 It may
be a prohibitory injunction, which requires a party to refrain from doing a particular act, or a mandatory
injunction, which commands a party to perform a positive act to correct a wrong in the past.18 It is a
provisional remedy that a party may resort to in order to preserve and protect certain rights and interests
during the pendency of an action.19
Section 3, Rule 58 of the Rules of Court provides:
SEC. 3. Grounds for issuance of preliminary injunction. - A preliminary injunction may be granted when it
is established:
(a) That the applicant is entitled to the relief demanded, and the whole or part of such relief
consists in restraining the commission or continuance of the act or acts complained of, or in
requiring the performance of an act or acts, either for a limited period or perpetually;
(b) That the commission, continuance or nonperformance of the act or acts complained of
during the litigation would probably work injustice to the applicant; or
(c) That a party, court, agency or a person is doing, threatening, or is attempting to do, or is
procuring or suffering to be done, some act or acts probably in violation of the rights of the
applicant respecting the subject of the action or proceeding, and tending to render the judgment
ineffectual.
The following requisites must be proved before a writ of preliminary injunction will issue: (1) The
applicant must have a clear and unmistakable right to be protected, that is, a right in esse; (2) There is a
material and substantial invasion of such right; (3) There is an urgent need for the writ to prevent
irreparable injury to the applicant; and ( 4) No other ordinary, speedy, and adequate remedy exists to
prevent the infliction of irreparable injury.20
The grant or denial of a writ of preliminary injunction is discretionary upon the trial court because the
assessment and evaluation of evidence towards that end involve findings of fact left to the said court for its
conclusive determination. For this reason, the grant or denial of a writ of preliminary injunction shall not
be disturbed unless it was issued with grave abuse of discretion amounting to lack or in excess of
jurisdiction.21
In denying Atlocom's application for a writ of preliminary injunction, the RTC held that Atlocom failed to
demonstrate a clear and unmistakable legal right thereto, as evidence showed Atlocom has no more right to
be protected considering that its PA had already expired and its application for extension was subsequently
denied by the NTC. As to the claim of violation of right to due process, the R TC found that prior to the
issuance of MC 06-08-2005, NTC published a notice of public hearing in The Manila Times, a newspaper
of general circulation, and at the said hearing the participants were given opportunity to be heard through
oral arguments and submission of position papers. Atlocom's alternative plea for a writ of mandatory
injunction was likewise denied. According to the RTC, ordering the NTC to reinstate Atlocom' s
frequencies would create an impression that the court had pre-judged the main case by nullifying MC 06-
08-2005 as prayed for by Atlocom in its petition.
However, the CA rendered a contrary ruling. The CA underscored the fact that NTC failed to act upon
Atlocom's motion for extension for more than three years, and concluded that because of NTC's inordinate
delay or refusal to renew the PA granted to Atlocom, the latter was deprived of its right to use the
frequencies "granted to it by" the PA. The CA thus held:
In deciding whether to grant an injunction, a court must consider established principles of equity and all
the circumstances of the test for issuing an injunction is whether the facts show a necessity for the
intervention of equity in order to protect rights cognizable in equity. Here, there are factual and legal
justification for issuance of the writ of injunction. To reiterate to the point of being pedantic, petitioner's
right to its frequencies is covered by a provisional authority. The provisional authority was withdrawn by
MC No. 06-08-2005 without the Respondent NTC acting on petitioner's plea for previous extensions. The
propriety for the issuance of MC No. 06-08-2005 is placed in issue on the ground of fairness. Petitioner as
the rightful grantee thereof has the right, in the meantime, to enjoin its implementation.
We are not unaware of Our Resolution promulgated on August 12, 2011 denying petitioner's plea for the
ancillary remedy of both prohibitory and/or mandatory injunction. Indeed, as of said date, the denial of
petitioner's prayer is appropriate. We have now the complete facts of the case and, as the legal consequence
of Our declaration that the RTC committed grave abuse of discretion in issuing the assailed orders, We
consider it proper to enjoin the Respondent NTC from implementing Memorandum Circular No. 06-08-
2005, but insofar as the frequencies ranging from 2572-2596 Mhz are involved and for its Co-Respondent
LBNI from using the aforestated frequencies. This is not to preempt the RTC of whatever judgment it may
thereafter issue with respect to the merits of the case before it but is issued in order to maintain the status
quo in view of petitioner's claim of a breach of due process and a continuing violation of its right over the
aforestated frequencies.22
The CA explained that since it is only through a frequency that Atlocom can provide adequate broadcast
service to the public, the withdrawal of frequency assignment without observance of due process defeats its
legislative grant and reduces Atlocom to a mere repository of transmitters and equipment devoid of any
purpose or value. It cited the following provisions of R.A. No. 8605:
SEC. 3. Prior Approval of the National Telecommunications Commission. - The grantee shall secure from
the National Telecommunications Commission, hereinafter referred to as the Commission, the appropriate
permits and licenses for the construction and operation of its stations, transmitters or facilities and shall not
use any frequency in the radio and television spectrum without having been authorized by the Commission.
The Commission, however, shall not unreasonably withhold or delay the grant of any such authority.
The radio spectrum is a finite resource that is a part of the national patrimony and the use thereof is a
privilege conferred upon the grantee by the State and may be withdrawn anytime, after due process.
On the withdrawal of the frequencies previously identified for Atlocom, the CA insisted that NTC did not
observe due process, viz.:
While it is true that there was a publication of a Notice of Public Hearing on June 21, 2005 before the
issuance of Memorandum Circular No. 06-08-2005 on August 23, 2005, the fact is, the publication or
notice was a general one and was not meant to dispose of petitioner's previous requests for an extension of
its provisional authority and/or application for permit to purchase equipment. The order which dealt with
these requests was the Order dated December 23, 2008, which was issued almost four (4) years after the
filing of the first request on April 5, 2004 and almost three (3) years from the issuance of Memorandum
Circular No. 06-08-2005. Withal and subject to whatever proof it may submit to the RTC regarding the
delay, the Respondent NTC should have first acted on petitioner's requests for extension before setting for
public hearing the re-allocation of the frequencies.23
We do not concur with the CA in holding that NTC's inaction or delay on Atlocom' s application for
extension of PA had violated the latter's right to due process because it resulted in depriving Atlocom of
the use of frequencies which were re-allocated through the issuance of MC 06-08-2005. Such declaration
rather conveys an inaccurate picture of the regulatory process for public broadcasting and
telecommunications services.
Under existing laws and regulations, it is clear that a frequency assignment is not automatically included in
the PA granted by the NTC to an applicant for a CPC. Thus, the Order dated October 8, 2003 expressly
provided that the PA granted to Atlocom, valid for 18 months, is subject to several conditions, foremost of
which is the assignment of frequency by the Frequency Management Division (FMD).
While Atlocom presented a Certification24 dated October 22, 2003 issued by Alvin N. Blanco, Chief of
NTC's Broadcast Division, stating that certain frequencies were "identified" for Atlocom's MMDS (Metro
Manila) covering 2572-2596 frequency bands, there is no document evidencing that these frequencies were
actually assigned to Atlocom by the FMD. There is likewise nothing in the records to suggest that NTC
"unreasonably" withheld or delayed authority to use such frequencies identified for Atlocom.
Atlocom blamed NTC's three-year delay in resolving the motion for extension of PA for its inability to use
the frequencies identified for its MMDS, as these were eventually re-allocated in 2005 under MC 06-08-
2005. But as Atlocom was fully aware, Section 6 of R.A. No. 8605 provides that the Government may at
anytime withdraw the frequency after due process. Records showed that a notice was duly published and a
public hearing was actually conducted on July 12, 2005 by NTC on the proposed Memo Circular:
Frequency Band Allocations for Broadcast Wireless Access. Saidevent was attended by representatives of
the different broadcasting and telecommunication companies, including Atlocom.25 The position papers
and feedback submitted by various companies in connection with the proposed memorandum circular on
wireless broadband access were all presented as evidence in the RTC. 26 We have held that the essence of
due process is simply an opportunity to be heard, or as applied to administrative proceedings, an
opportunity to explain one's side.27 The requirements of due process were thus satisfied by the NTC in the
re-allocation of frequency.
Contrary to the CA's pronouncement, the re-allocation of frequency cannot be conditioned on resolution of
any pending request for extension of PA previously granted. Even entities with unexpired PA cannot claim
a vested right on a specific frequency assignment. This proceeds from the nature of its franchise which is
not solely for commercial purposes but one imbued with public interest. As earlier quoted, Atlocom's
franchise (R.A. No. 8605) declared the use of radio spectrum as a mere privilege conferred upon the
grantee by the State that may be withdrawn anytime provided that due process is observed. It further
emphasized that the radio spectrum is a finite resource and its use and distribution should be aligned with
existing laws and policies.
R.A. No. 7925 likewise recognizes the vital role of telecommunications to national development and
security and provides that the radio frequency shall be managed and directed to serve the public interest.
Being a limited resource, the law mandates a periodic review of frequency allocation.
SEC. 4. Declaration of National Policy. - Telecommunications is essential to the economic development,
integrity and security of the Philippines, and as such shall be developed and administered as to safeguard,
enrich and strengthen the economic, cultural, social and political fabric of the Philippines. The growth and
development of telecommunications services shall be pursued in accordance with the following policies:
c) The radio frequency spectrum is a scarce public resource that shall be administered in the public interest
and in accordance with international agreements and conventions to which the Philippines is a party and
granted to the best qualified. The government shall allocate the spectrum to service providers who will use
it efficiently and effectively to meet public demand for telecommunications service and may avail of new
and cost effective technologies in the use of methods for its utilization;
SEC. 15. Radio Frequency Spectrum. - The radio frequency spectrum allocation and assignment shall be
subject to periodic review. The use thereof shall be subject to reasonable spectrum user fees. Where
demand for specific frequencies exceed availability, the Commission shall hold open tenders for the same
and ensure wider access to this limited resource.
As a grantee of PA, Atlocom can only invoke the condition in MC 06-08-2005 that "[t]he transfer of
previously authorized persons or entities operating radio stations within the above listed radio frequency
bands shall be governed by Rule 603 of MC 3-3-96."28Said rule states:
603. TRANSFER OF AFFECTED AUTHORIZED RADIO FREQUENCY USER
a. The commission shall allocate available radio frequencies for assignment to those affected by
the reallocation as a result of the review of the radio spectrum pursuant to Rule 601.
b. The cost of the transfer to new radio frequencies of affected authorized users shall be borne
by the new assignees to the radio frequency channel/band where the radio frequencies of the
previously authorized users fall within.
c. When the transfer to a new set of radio frequencies would require additional radio links, the
cost of these links shall also be taken into consideration.
d. The manner and the cost of the transfer shall be negotiated in good faith between the affected
authorized users and the assignees within 90 days from receipt of notice of relocation.
e. The Commission shall extend all the necessary assistance to all affected authorized users and
shall mandate settlement if the parties fail to come to an agreement within 90 days from receipt
of notice of relocation or when warranted under the circumstances.
f. Other means/mode of transmission comparable in quality to the existing facility shall be taken
into consideration in the negotiation for the transfer.
g. Transfer of radio frequency assignment shall only take effect upon activation of service by
relocated party using its newly assigned or relocated frequency as agreed or mandated.
Considering that Atlocom has not even launched its MMDS network nor constructed radio stations, it is
doubtful whether Atlocom can exercise the foregoing rights of an affected frequency user. Neither can
Atlocom attribute its non-operational state to the delayed action on its motion for extension of PA. Among
the conditions of its PA is the commencement of the construction and installation of its station within six
months from issuance of the order granting it the provisional authority and its complete three months
thereafter. Perusal of the motion for extension reveals that Atlocom at the time .was still in the process of
identifying and finalizing arrangements with its potential investors for the establishment of a nationwide
MMDS network coverage.
Based on its evaluation, the NTC found that: (1) Atlocom filed an application for Permit to Purchase
MMDS transmitter on February 9, 2005, but no permit of any kind was issued to it; (2) In the clarificatory
hearing held on September 4, 2006, concerns were raised regarding reports of foreign equity on Atlocom's
capital structure and status of band allocated for MMDS within the 2.5-2.7 Ghz band; and (3) On June 21,
2008, Atlocom is requesting for an allocation of a Digital Terrestrial TV frequency (Ch 14-20 & Ch 21-51)
in replacement for their MMDS frequency, but the NTC thru FMD denied such request because the
proposed frequency band for DTT service is not yet approved/allocated. With the re-allocation of MMDS
frequency bands for the Broadband Wireless Access under MC 06-8-2005, and the aforesaid findings, the
NTC en bane decided not to grant the extension sought by Atlocom.
A right to be protected by injunction, means a right clearly founded on or granted by law or is enforceable
as a matter of law.29 An injunction is not a remedy to protect or enforce contingent, abstract, or future
rights; it will not issue to protect a right not in esse, and which may never arise, or to restrain an act which
does not give rise to a cause of action.30
From the evidence on record, no clear, actual and existing right to the subject frequencies or to the
extension of PA had been shown by Atlocom. Accordingly, no grave abuse of discretion was committed by
the RTC in denying Atlocom's application for a writ of preliminary injunction to restrain the
implementation of MC 06-08-2005 insofar as the use of the re-allocated frequencies claimed by Atlocom.
The CA thus seriously erred in reversing the RTC and holding that Atlocom was entitled to injunctive
relief due to alleged violation of its right by the NTC.
A writ of preliminary injunction being an extraordinary event, one deemed as a strong arm of equity or a
transcendent remedy, it must be granted only in the face of actual and existing substantial rights. In the
absence of the same, and where facts are shown to be wanting in bringing the matter within the conditions
for its issuance, the ancillary writ must be struck down for having been rendered in grave abuse of
discretion.31
Pursuant to Section 6,32 Rule 5 8 of the 1997 Rules of Civil Procedure, a preliminary injunction may be
dissolved if it appears after hearing that although the applicant is entitled to the injunction or restraining
order, the issuance or continuance thereof, as the case may be, would cause irreparable damage to the party
or person enjoined while the applicant can be fully compensated for such damages as he may suffer, and
the former files a bond in an amount fixed by the court on condition that he will pay all damages which the
applicant may suffer by the denial or the dissolution of the injunction or restraining order. Two conditions
must concur: first, the court, in the exercise of its discretion, finds that the continuance of the injunction
would cause great damage to the defendant, while the plaintiff can be fully compensated for such damages
as he may suffer; second, the defendant files a counterbond. 33
In denying LBNI's offer to file counterbond, the CA relied on the Affidavit34 executed by Rene Rosales,
Atlocom's technical consultant, to refute the earlier Affidavit35 submitted by LBNI, which was executed by
its Director for Network Engineering, Edwin C. Mabitazan. Mabitazan stated that the injunction issued by
the CA will result in reducing LBNI's usable bandwidth from 40 Mhz to only 15 Mhz, which is inadequate
to serve LBNI's thousands of subscribers. Mabitazan's opinion should have been given more weight in
view of his intimate knowledge of LBNI' s operations and technical requirements. Moreover, it should be
stressed that LBNI's business projections were based on its existing technical capability which stands to be
greatly diminished once the frequency bands re-assigned to it will be reduced as a result of the CA's
injunction order. The possibility of irreparable damage is indeed present, not only in terms of financial
losses -the total investment by LBNI has already reached billions of pesos - but on the reputation of LBNI
as a new player in the telecommunications industry for reliability and dependability of its services. In
contrast, whatever damage Atlocom stands to suffer should the injunction be dissolved, can be fully
compensated considering that it has not constructed stations nor launched any network service. No single
document was submitted by Atlocom to show it had actually complied with the conditions of its PA and event that said frequency band re-allocation is approved, only broadcasting company
invested in the establishment of MMDS network, which never materialized. with existing TV station/s and/or authority to operate is entitled for
application/issuance of a DTT frequency channel."
In gross abuse of discretion, the CA brushed aside evidence presented by LBNI in support of its offer to
file counter-bond, stating that these were submitted only after the appellate court had rendered its decision 7. A Memo addressed to the Chief, Frequency Management Division dated 27 July 2012 (copy
granting Atlocom's prayer for preliminary injunction. The CA failed to consider the fact that it was attached as Annex "I") Chief, BSD in connection with the "certification" issued to Atlocom
Atlocom which misled the courts and the NTC in claiming that the subject frequencies had been assigned Wireless System, Inc clarifies the following:
to it. The matter was raised by NTC and LBNI only in their motions for reconsideration because it was
only at that time when their inquiry from FMD disclosed that said office had not actually granted a
"that the frequencies stated in the subject certification were simply identified as
frequency assignment to Atlocom. Thus, NTC in its Supplemental Motion for Reconsideration, submitted a
candidate frequencies for the MMDS service under NTC Case No. 98-158, subject
Certification36 dated August 2, 2012 issued by the FMD Chief, Pricilla F. Demition, together with attached
to final frequency assignment by the Frequency Management Division (FMD) of
documents, setting forth the sam facts relativ to Atlocom's non-operational state. Atlocom countered that
this Commission." and
said evidence was just an afterthought because the absence of frequency assignment was not mentioned by
Engr. Demition when she testified before the RTC on January 14, 2009 during the hearing on the
application for writ of preliminary injunction. Atlocom, however never disputed the findings of the FMD. "Furthermore inasmuch as frequency assignments covering the band 2500-2700
Mhz are issued by the Frequency Management Division (FMD), the undersigned is
of the view that the determination of the assignment of the subject frequencies to
The pertinent portions of the FMD Certification are herein reproduced:
Atlocom Wireless, or to any other entity, can best be certified by the Frequency
Management Division (FMD)"
2. In a memo addressed to the Chief, Broadcast Services Division dated January 10, 2006 (copy
attached as Annex "B"); signed by then Deputy Commissioner Jorge V. Sarmiento, an inquiry
8. As per NTC Office Order No. 59-07-2003 dated July 30, 2003 (copy attached as Annex "J),
was made to the Broadcast Services Division (BSD) regarding the status of usage of the
all requests, applications requiring clearance and/or new radio frequency assignments, except
frequency assignments granted to broadcast companies for MMDS use and to provide
for frequencies that have been pre-allocated and/or decentralized, shall be cleared with the
information thru the FMD of the latest related information to include among others
Office of the Commissioner thru the Frequency Management Division:
permits/licenses issued to their favor; such information was needed in view of the re-allocation
of the band in use for BW A (MC No. 06-08-2005);
"Henceforth, except for frequencies that have been pre-allocated and/or
decentralized, all requests applications requiring clearance and/or new radio
3. In a memo dated January 12, 2006 (copy attached as Annex "C") in compliance to the
frequency assignment shall be cleared with the Office of the Commissioner thru the
January 10, 2006 Memo, BSD's report shows under the column Latest Permits/License issued,
Frequency Management Division."
that the latest permit or license issued for A TLOCOM was only its PA dated 10.08.03;

9. No records/documents were however found at the Frequency Management Division showing

4. In a memo addressed to the Records Verification Committee dated 06 September 2006 (copy
attached as Annex "D") signed by then Commissioner Ronald Olivar Solis, citing a memo dated
21 September 2005 from then DOTC Secretary Leonardo R. Mendoza and Office Order No.
71-08-2006, the Records Verification Committee was directed to verify the status of several
radio frequency bands therein listed, and to submit its report to include, among others, SUF
payments, latest permits, and licenses issued and photocopies of the same;
5. The Records Verification Committee reported in a memo dated 08 September 2006 (copy
attached as Annex "E"), that with respect to Atlocom Wireless System, Inc., no record on file
was found as to station location, frequency, license/permit no., radio station license or permit to
purchase and possess;
6. In a memo addressed to the Acting Chief BSD dated 07 January 2008 by then FMD Acting
Chief Engr. Joselito C. Leynes (copy attached as Annex "F") [w]ith reference to the 03 January
2008 indorsement letter from BSD (copy attached as Annex "G) regarding the request of
Atlocom Wireless System, Inc. for an allocation of a Digital Television (DTT) frequency (copy
attached
as Annex "H"), the BSD was informed of the following for guidance:
frequency assignment clearance for the use of ATLOCOM's MMDS system.
In light of all the foregoing established facts, we hold that the CA gravely abused its discretion when it
issued a writ of preliminary injunction against the implementation of MC 06-08-2005 in the absence of a
clear legal right on the part of Atlocom, and subsequently denying LBNI' s offer to file counter bond
despite compliance with the requisites provided in Section 6 of Rule 58. However, with our ruling that the
writ of preliminary injunction was improperly issued, hence, null and void, the matter of allowing LBNI to
post a counter-bond has been rendered moot.
A final note. In its Memorandum,37 Atlocom argues that LBNI is part of mass media and its franchise
violates Article XVI, Section 11 (1) of the Constitution 38 because it is not wholly-owned by Filipino
citizens.39
Unless properly raised and the very /is mota of the case, we do not pass upon constitutional issues. The
resolution of the constitutional issues must be absolutely necessary for the determination of the case.40 In
the spirit of deference to the acts of other constitutional departments and organs, issues before this Court
should address only the narrowest issues necessary to determine whether the reliefs prayed for can be
granted. As in this case, reliefs can be determined on procedural issues.

The main issue presented in this case is the validity of Atlocom' s application for a writ of preliminary
"that the proposed frequency band from Channel 14-20 and Channel 21-51 is not yet
injunction against the NTC.1âwphi1 This issue can be resolved without passing upon the constitutionality
been finally allocated/approved for the purpose ofDTT operation. Further, in the
of LBNI' s franchise. The resolution of the issue on LBNI's eligibility thus has no bearing on whether
Atlocom has the right to be granted a frequency allocation for Broadband Wireless Access by the NTC.
The constitutional issue raised by the respondent may be raised and resolved in proper cases when
necessary in the future.

WHEREFORE, the petitions are GRANTED. The Decision dated June 29, 2012 and Resolution dated
February 18, 2013 of the Court of Appeals in CA-G.R. SP No. 119868 are REVERSED and SET ASIDE.
Consequently, the writ of preliminary injunction issued in said case, if any, is hereby declared NULL and
VOID.

The Orders dated December 9, 2010 and March 21, 2011 of the Regional Trial Court of Quezon City,
Branch 95 in Q-09-65566 are hereby REINSTATED and UPHELD.

The Temporary Restraining Order issued by this Court on April 30, 2013 is hereby made PERMANENT.

No pronouncement as to costs.

SO ORDERED.
GR. No. 197472
REPUBLIC OF THE PHILIPPINES, represented by Commander Raymond Alpuerto of the Naval
Base Camillo Osias, Port San Vicente, Sta. Ana, Cagayan, Petitioner,
vs.
REV. CLAUDIO R. CORTEZ, SR., Respondent.
DECISION
DEL CASTILLO, J.:
An inalienable public land cannot be appropriated and thus may not be the proper object of possession.
Hence, injunction cannot be issued in order to protect ones alleged right of possession over the same.
This Petition for Review on Certiorari1 assails the June 29, 2011 Decision2 of the Court of Appeals (CA)
in CA-GR. CV No. 89968, which dismissed the appeal therewith and affirmed the July 3, 2007
Decision3 of the Regional Trial Court (RTC) of Aparri, Cagayan, Branch 8 in Spl. Civil Action Case No.
II-2403.
Factual Antecedents
Respondent Rev. Claudio R. Cortez, Sr. (Rev. Cortez), a missionary by vocation engaged in humanitarian
and charitable activities, established an orphanage and school in Punta Verde, Palaui Island, San Vicente,
Sta. Ana, Cagayan. He claimed that since 1962, he has been in peaceful possession of about 50 hectares of
land located in the western portion of Palaui Island in Sitio Siwangag, Sta. Ana, Cagayan which he, with
the help of Aetas and other people under his care, cleared and developed for agricultural purposes in order
to support his charitable, humanitarian and missionary works.4
On May 22, 1967, President Ferdinand E. Marcos issued Proclamation No. 201 reserving for military
purposes a parcel of the public domain situated in Palaui Island. Pursuant thereto, 2,000 hectares of the
southern half portion of the Palaui Island were withdrawn from sale or settlement and reserved for the use
of the Philippine Navy, subject, however, to private rights if there be any.
More than two decades later or on August 16, 1994, President Fidel V. Ramos issued Proclamation No.
447 declaring Palaui Island and the surrounding waters situated in the Municipality of Sta. Ana, Cagayan
as marine reserve. Again subject to any private rights, the entire Palaui Island consisting of an aggregate
area of 7,415.48 hectares was accordingly reserved as a marine protected area.
On June 13, 2000, Rev. Cortez filed a Petition for Injunction with Prayer for the Issuance of a Writ of
Preliminary Mandatory Injunction5 against Rogelio C. Biñas (Biñas) in his capacity as Commanding
Officer of the Philippine Naval Command in Port San Vicente, Sta. Ana, Cagayan.1âwphi1 According to
him, some members of the Philippine Navy, upon orders of Biñas, disturbed his peaceful and lawful
possession of the said 50-hectare portion of Palaui Island when on March 15, 2000, they commanded him
and his men, through the use of force and intimidation, to vacate the area. When he sought assistance from
the Office of the Philippine Naval Command, he was met with sarcastic remarks and threatened with
drastic military action if they do not vacate. Thus, Rev. Cortez and his men were constrained to leave the
area. In view of these, Rev. Cortez filed the said Petition with the RTC seeking preliminary mandatory
injunction ordering Biñas to restore to him possession and to not disturb the same, and further, for the said
preliminary writ, if issued, to be made permanent.
Proceedings before the Regional Trial Court
After the conduct of hearing on the application for preliminary mandatory injunction6 and the parties’
submission of their respective memoranda,7 the RTC issued an Order8 dated February 21, 2002 granting
the application for a writ of preliminary mandatory injunction. However, the same pertained to five
hectares (subject area) only, not to the whole 50 hectares claimed to have been occupied by Rev.
Cortez, viz.:
It should be noted that the claim of [Rev. Cortez] covers an area of 50 hectares more or less located at the
western portion of Palaui Island which is within the Naval reservation. [Rev. Cortez] presented what he
called as a survey map (Exh. "H") indicating the location of the area claimed by the Church of the Living
God and/or Rev. Claudio Cortez with an approximate area of 50 hectares identified as Exh. "H-4".
However, the Survey Map allegedly prepared by [a] DENR personnel is only a sketch map[,] not a survey
map as claimed by [Rev. Cortez]. Likewise, the exact boundaries of the area [are] not specifically
indicated. The sketch only shows some lines without indicating the exact boundaries of the 50 hectares
claimed by [Rev. Cortez]. As such, the identification of the area and its exact boundaries have not been
clearly defined and delineated in the sketch map. Therefore, the area of 50 hectares that [Rev. Cortez]
claimed to have peacefully and lawfully possessed for the last 38 years cannot reasonably be determined or
accurately identified.
For this reason, there is merit to the contention of [Biñas] that [Rev. Cortez]’ claim to the 50 hectares of
land identified as Exh. ["]H-4" is unclear and ambiguous. It is a settled jurisprudence that mandatory
injunction is the strong arm of equity that never ought to be extended unless to cases of great injury, where
courts of law cannot afford an adequate and commensurate remedy in damages. The right must be clear,
the injury impending or threatened, so as to be averted only by the protecting preventive process of
injunction. The reason for this doctrine is that before the issue of ownership is determined in the light of
the evidence presented, justice and equity demand that the [status quo be maintained] so that no advantage
may be given to one to the prejudice of the other. And so it was ruled that unless there is a clear
pronouncement regarding ownership and possession of the land, or unless the land is covered by the
torrens title pointing to one of the parties as the undisputed owner, a writ of preliminary injunction should
not issue to take the property out of possession of one party to place it in the hands of another x x x.
Admittedly, the documentary exhibits of [Rev. Cortez] tended only to show that [he] has a pending
application of patent with the DENR. Even so, [Rev. Cortez] failed to present in evidence the application
for patent allegedly filed by [him] showing that he applied for patent on the entire 50 hectares of land
which he possessed or occupied for a long period of time. Under the circumstances, therefore, the title of
petitioner to the 50 hectares of land in Palaui Island remains unclear and doubtful, and [is] seriously
disputed by the government.
More significantly, at the time that Proc. No. 201 was issued on May 22, 1967, [Rev. Cortez] has not
perfected his right over the 50 hectares of land nor acquired any vested right thereto considering that he
only occupied the land as alleged by him in 1962 or barely five (5) years before the issuance of the
Presidential Proclamation. Proclamation No. 201 had the effect of removing Palaui Island from the
alienable or disposable portion of the public domain and therefore the island, as of the date of [the]
issuance [of the proclamation], has ceased to be disposable public land.
However, the court is not unmindful that [Rev. Cortez] has lawfully possessed and occupied at least five
(5) hectares of land situated at the western portion of the Palaui Island identified as Exh "H-4". During the
hearing, Cmdr.
Rogelio Biñas admitted that when he was assigned as Commanding Officer in December 1999, he went to
Palaui Island and [saw only] two (2) baluga families tilling the land consisting of five (5) hectares.
Therefore, it cannot be seriously disputed that [Rev. Cortez] and his baluga tribesmen cleared five (5)
hectares of land for planting and cultivation since 1962 on the western portion identified as Exhibit "H-4".
The Philippine Navy also admitted that they have no objection to settlers of the land prior to the
Presidential Proclamation and [Rev. Cortez] had been identified as one of the early settlers of the area
before the Presidential Proclamation. The DENR also acknowledged that [Rev. Cortez] has filed an
application for patent on the western area and that he must be allowed to pursue his claim.
Although the court is not persuaded by the argument of [Rev. Cortez] that he has already acquired vested
rights over the area claimed by him, the court must recognize that [Rev. Cortez] may have acquired some
propriety rights over the area considering the directive of the DENR to allow [Rev. Cortez] to pursue his
application for patent. However, the court wants to make clear that the application for patent by [Rev.
Cortez] should be limited to an area not to exceed five (5) hectares situated at the western portion of x x x
Palaui Island identified in the sketch map as Exh. "H-4." This area appears to be the portion where [Rev.
Cortez] has clearly established his right or title by reason of his long possession and occupation of the
land.9
In his Answer,10 Biñas countered that: (1) Rev. Cortez has not proven that he has been in exclusive, open,
continuous and adverse possession of the disputed land in the concept of an owner; (2) Rev. Cortez has not
shown the exact boundaries and identification of the entire lot claimed by him; (3) Rev. Cortez has not
substantiated his claim of exemption from Proclamation No. 201; (4) under Proclamation No. 447, the
entire Palaui Island, which includes the land allegedly possessed and occupied by Rev. Cortez, was
reserved as a marine protected area; and, (4) injunction is not a mode to wrest possession of a property
from one person by another.
Pre-trial and trial thereafter ensued.
On July 3, 2007, the RTC rendered its Decision11 making the injunction final and permanent. In so ruling,
the said court made reference to the Indigenous Peoples’ [Right] Act (IPRA) as follows:
The Indigenous [Peoples’ Right] Act should be given effect in this case. The affected community belongs
to the group of indigenous people which are protected by the State of their rights to continue in their
possession of the lands they have been tilling since time immemorial. No subsequent passage of law or
presidential decrees can alienate them from the land they are tilling. 12
Ultimately, the RTC held, thus:
WHEREFORE, finding the petition to be meritorious, the same is hereby GRANTED.
xxxx
SO DECIDED.13
Representing Biñas, the Office of the Solicitor General (OSG) filed a Notice of Appeal14 which was given
due course by the RTC in an Order15 dated August 6, 2007.
Ruling of the Court of Appeals
In its brief,16 the OSG pointed out that Rev. Cortez admitted during trial that he filed the Petition for
injunction on behalf of the indigenous cultural communities in Palaui Island and not in his capacity as
pastor or missionary of the Church of the Living God. He also claimed that he has no interest over the land.
Based on these admissions, the OSG argued that the Petition should have been dismissed outright on the
grounds that it did not include the name of the indigenous cultural communities that Rev. Cortez is
supposedly representing and that the latter is not the real party-in-interest. In any case, the OSG averred
that Rev. Cortez failed to show that he is entitled to the issuance of the writ of injunction. Moreover, the
OSG questioned the RTC’s reference to the IPRA and argued that it is not applicable to the present case
since Rev. Cortez neither alleged in his Petition that he is claiming rights under the said act nor was there
any showing that he is a member of the Indigenous Cultural Communities and/or the Indigenous Peoples as
defined under the IPRA.
In its Decision17 dated June 29, 2011, the CA upheld the RTC’s issuance of a final injunction based on the
following ratiocination:
The requisites necesary for the issuance of a writ of preliminary injunction are: (1) the existence of a clear
and unmistakable right that must be protected; and (2) an urgent and paramount necessity for the writ to
prevent serious damage. Here, [Rev. Cortez] has shown the existence of a clear and unmistakable right that
must be protected and an urgent and paramount necessity for the writ to prevent serious damage. Records
reveal that [Rev. Cortez] has been in peaceful possession and occupation of the western portion of Palaui
Island, Sitio Siwangag, San Vicente, Sta. Ana[,] Cagayan since 1962 or prior to the issuance of
Proclamation Nos. 201 and 447 in 1967 and 1994, respectively. There he built an orphanage and a school
for the benefit of the members of the Dumagat Tribe, in furtherance of his missionary and charitable
works. There exists a clear and unmistakable right in favor [of Rev. Cortez] since he has been in open,
continuous and notorious possession of a portion of Palaui island. To deny the issuance of a writ of
injunction would cause grave and irreparable injury to [Rev. Cortez] since he will be displaced from the
said area which he has occupied since 1962. It must be emphasized that Proclamation Nos. 201 and 447
stated that the same are subject to private rights, if there be [any]. Though Palaui Island has been declared
to be part of the naval reservation and the whole [i]sland as a marine protected area, both recognized the
existence of private rights prior to the issuance of the same.
From the foregoing, we rule that the trial court did not err when it made permanent the writ of preliminary
mandatory injunction. Section 9, Rule 58 of the Rules of Court provides that if after the trial of the action it
appears that the applicant is entitled to have the act or acts complained of permanently enjoined, the court
shall grant a final injunction perpetually restraining the party or person enjoined from the commission or
continuance of the act or acts or confirming the preliminary mandatory injunction. 18
Anent the issue of Rev. Cortez not being a real party-in-interest, the CA noted that this was not raised
before the RTC and therefore cannot be considered by it. Finally, with respect to the RTC’s mention of the
IPRA, the CA found the same to be a mere obiter dictum.
The dispositive portion of the CA Decision reads:
WHEREFORE, premise[s] considered, the instant Appeal is hereby DENIED. The assailed 3 July 2007
Decision of the Regional Trial Court of Aparri, Cagayan, Branch 8 in Civil Case No. II-2403 is
AFFIRMED.
SO ORDERED.19
Hence, this Petition brought by the OSG on behalf of the Republic of the Philippines (the Republic).
The Issue
The ultimate issue to be resolved in this case is whether Rev. Cortez is entitled to a final writ of mandatory
injunction.
The Parties’ Arguments
The bone of contention as the OSG sees it is the injunctive writ since Rev. Cortez failed to prove his clear
and positive right over the 5-hectare portion of Palaui Island covered by the same. This is considering that
by his own admission, Rev. Cortez started to occupy the said area only in 1962. Hence, when the property
was declared as a military reserve in 1967, he had been in possession of the 5-hectare area only for five
years or short of the 30-year possession requirement for a bona fide claim of ownership under the law. The
OSG thus argues that the phrase "subject to private rights" as contained in Proclamation No. 201 and
Proclamation No. 447 cannot apply to him since it only pertains to those who have already complied with
the requirements for perfection of title over the land prior to the issuance of the said proclamations.
Rev. Cortez, for his part, asserts that the arguments of the OSG pertaining to ownership are all immaterial
as his Petition for injunction does not involve the right to possess based on ownership but on the
right of possession which is a right independent from ownership. Rev. Cortez avers that since he has been
in peaceful and continuous possession of the subject portion of Palaui Island, he has the right of possession
over the same which is protected by law. He asserts that based on this right, the writ of injunction was
correctly issued by the RTC in his favor and aptly affirmed by the CA. On the technical side, Rev. Cortez
avers that the Republic has no legal personality to assail the CA Decision through the present Petition since
it was not a party in the appeal before the CA.
The Court’s Ruling
We grant the Petition.
For starters, the Court shall distinguish a preliminary injunction from a final injunction.
"Injunction is a judicial writ, process or proceeding whereby a party is directed either to do a particular act,
in which case it is called a mandatory injunction, [as in this case,] or to refrain from doing a particular act,
in which case it is called a prohibitory injunction."20 "It may be the main action or merely a provisional
remedy for and as an incident in the main action."21
"The main action for injunction is distinct from the provisional or ancillary remedy of preliminary
injunction."22 A preliminary injunction does not determine the merits of a case or decide controverted
facts.23 Since it is a mere preventive remedy, it only seeks to prevent threatened wrong, further injury and
irreparable harm or injustice until the rights of the parties are settled. 24 "It is usually granted when it is
made to appear that there is a substantial controversy between the parties and one of them is committing an
act or threatening the immediate commission of an act that will cause irreparable injury or destroy
the status quo of the controversy before a full hearing can be had on the merits of the case."25 A
preliminary injunction is granted at any stage of an action or proceeding prior to judgment or final
order.26 For its issuance, the applicant is required to show, at least tentatively, that he has a right which is
not vitiated by any substantial challenge or contradiction.27 Simply stated, the applicant needs only to show
that he has the ostensible right to the final relief prayed for in his complaint.28 On the other hand, the main
action for injunction seeks a judgment that embodies a final injunction.29 A final injunction is one which
perpetually restrains the party or person enjoined from the commission or continuance of an act, or in case
of mandatory injunctive writ, one which confirms the preliminary mandatory injuction. 30 It is issued when
the court, after trial on the merits, is convinced that the applicant is entitled to have the act or acts
complained of permanently enjoined.31 Otherwise stated, it is only after the court has come up with a
definite pronouncement respecting an applicant’s right and of the act violative of such right, based on its
appreciation of the evidence presented, that a final injunction is issued. To be a basis for a final and
permanant injunction, the right and the act violative thereof must be established by the applicant with
absolute certainty.32
What was before the trial court at the time of the issuance of its July 3, 2007 Decision is whether a final
injunction should issue. While the RTC seemed to realize this as it in fact made the injunction permanent,
the Court, however, finds the same to be wanting in basis.
Indeed, the RTC endeavored to provide a narrow distinction between a preliminary injunction and a final
injunction. Despite this, the RTC apparently confused itself. For one, what it cited in its Decision were
jurisprudence relating to preliminary injunction and/or mandatory injunction as an ancillary writ and not as
a final injunction. At that point, the duty of the RTC was to determine, based on the evidence presented
during trial, if Rev. Cortez has conclusively established his claimed right (as opposed to preliminary
injunction where an applicant only needs to at least tentatively show that he has a right) over the subject
area. This is considering that the existence of such right plays an important part in determining whether the
preliminary writ of mandatory injunction should be confirmed.
Surprisingly, however, the said Decision is bereft of the trial court’s factual findings on the matter as well
as of its analysis of the same vis-a-vis applicable jurisprudence. As it is, the said Decision merely contains
a restatement of the parties’ respective allegations in the Complaint and the Answer, followed by a
narration of the ensuing proceedings, an enumeration of the evidence submitted by Rev. Cortez, a
recitation of jurisprudence relating to preliminary injunction and/or specifically, to mandatory injunction as
an ancillary writ, a short reference to the IPRA which the Court finds to be irrelevant and finally, a
conclusion that a final and permanent injunction should issue. No discussion whatsoever was made with
respect to whether Rev. Cortez was able to establish with absolute certainty hisclaimed right over the
subject area.
Section 14, Article VIII of the Constitution, as well as Section 1 of Rule 36 and Section 1, Rule 120 of the
Rules on Civil Procedure, similarly state that a decision, judgment or final order determining the merits of
the case shall state, clearly and distinctly, the facts and the law on which it is based. Pertinently, the Court
issued on January 28, 1988 Administrative Circular No. 1, which requires judges to make complete
findings of facts in their decision, and scrutinize closely the legal aspects of the case in the light of the
evidence presented, and avoid the tendency to generalize and to form conclusion without detailing the facts
from which such conclusions are deduced.33
Clearly, the Decision of the RTC in this case failed to comply with the aforestated guidelines.
In cases such as this, the Court would normally remand the case to the court a quo for compliance with the
form and substance of a Decision as required by the Constitution. In order, however, to avoid further delay,
the Court deems it proper to resolve the case based on the merits. 34
"Two requisites must concur for injunction to issue: (1) there must be a right to be protected and (2) the
acts against which the injunction is to be directed are violative of said right."35 Thus, it is necessary that the
Court initially determine whether the right asserted by Rev. Cortez indeed exists. As earlier stressed, it is
necessary that such right must have been established by him with absolute certainty.
Rev. Cortez argues that he is entitled to the injunctive writ based on the right of possession (jus
possesionis) by reason of his peaceful and continuous possession of the subject area since 1962. He avers
that as this right is protected by law, he cannot be peremptorily dispossessed therefrom, or if already
dispossessed, is entitled to be restored in possession. Hence, the mandatory injunctive writ was correctly
issued in his favor.
Jus possessionis or possession in the concept of an owner36 is one of the two concepts of possession
provided under Article 52537 of the Civil Code. Also referred to as adverse possession,38 this kind of
possesion is one which can ripen into ownership by prescription.39 As correctly asserted by Rev. Cortez, a
possessor in the concept of an owner has in his favor the legal presumption that he possesses with a just
title and he cannot be obliged to show or prove it.40 In the same manner, the law endows every possessor
with the right to be respected in his possession.41
It must be emphasized, however, that only things and rights which are susceptible of being appropriated
may be the object of possession.42 The following cannot be appropriated and hence, cannot be
possessed: property of the public dominion, common things (res communes) such as sunlight and air, and
things specifically prohibited by law.43
Here, the Court notes that while Rev. Cortez relies heavily on his asserted right of possession, he,
nevertheless, failed to show that the subject area over which he has a claim is not part of the public domain
and therefore can be the proper object of possession.
Pursuant to the Regalian Doctrine, all lands of the public domain belong to the State. 44 Hence, "[a]ll lands
not appearing to be clearly under private ownership are presumed to belong to the State. Also, public lands
remain part of the inalienable land of the public domain unless the State is shown to have reclassified or
alienated them to private persons."45 To prove that a land is alienable, the existence of a positive act of the
government, such as presidential proclamation or an executive order; an administrative action;
investigation reports of Bureau of Lands investigators; and a legislative act or a statute declaring the land
as alienable and disposable must be established.46
Anent the technical issue raised by Rev. Cortez, i. e, that the Republic has no personality to bring this
Petition since it was not a party before the CA, the Court deems it prudent to set aside this procedural
barrier. After all, "a party's standing before [the] Court is a [mere] procedural technicality which may, in
the exercise of [its] discretion, be set aside in view of the importance of the issue raised." 49
We note that Rev. Cortez alleged that he sought the injunction so that he could continue his humanitarian
works. However, considering that inalienable public land was involved, this Court is constrained to rule in
accordance with the aforementioned.
WHEREFORE, the Petition is GRANTED. The June 29, 2011 Decision of the Court of Appeals in CA-
GR. CV No. 89968 denying the appeal and affirming the July 3, 2007 Decision of the Regional Trial Court
of Aparri, Cagayan-Branch 08 in Spl. Civil Action Case No. II-2403, is REVERSED and SET
ASIDE. Accordingly, the final injunction issued in this case is ordered DISSOLVED and the Petition for
Injunction in Spl. Civil Action Case No. II-2403, DISMISSED.

In this case, there is no such proof showing that the subject portion of Palaui Island has been declared SO ORDERED.
alienable and disposable when Rev. Cortez started to occupy the same. Hence, it must be considered as still
inalienable public domain. Being such, it cannot be appropriated and therefore not a proper subject of
possession under Article 530 of the Civil Code. Viewed in this light, Rev. Cortez’ claimed right of
possession has no leg to stand on. His possession of the subject area, even if the same be in the concept of
an owner or no matter how long, cannot produce any legal effect in his favor since the property cannot be
lawfully possessed in the first place.

The same goes true even if Proclamation No. 201 and Proclamation No. 447 were made subject to private
rights. The Court stated in Republic v. Bacas,47 viz.:

Regarding the subject lots, there was a reservation respecting ‘private rights.’ In Republic v. Estonilo,
where the Court earlier declared that Lot No. 4319 was part of the Camp Evangelista Military Reservation
and, therefore, not registrable, it noted the proviso in Presidential Proclamation No. 265 requiring the
reservation to be subject to private rights as meaning that persons claiming rights over the reserved land
were not precluded from proving their claims. Stated differently, the said proviso did not preclude the LRC
from determining whether x x x the respondents indeed had registrable rights over the property.

As there has been no showing that the subject parcels of land had been segregated from the military
reservation, the respondents had to prove that the subject properties were alienable or disposable
land of the public domain prior to its withdrawal from sale and settlement and reservation for
military purposes under Presidential Proclamation No. 265. The question is primordial importance
because it is determinative if the land can in fact be subject to acquisitive prescription and, thus, registrable
under the Torrens system. Without first determining the nature and character of the land, all other
requirements such as length and nature of possession and occupation over such land do not come
into play. The required length of possession does not operate when the land is part of the public
domain.

In this case, however, the respondents miserably failed to prove that, before the proclamation, the subject
lands were already private lands. They merely relied on such ‘recognition’ of possible private rights. In
their application, they alleged that at the time of their application, they had been in open, continuous,
exclusive and notorious possession of the subject parcels of land for at least thirty (30) years and became
its owners by prescription. There was, however, no allegation or showing that the government had earlier
declared it open for sale or settlement, or that it was already pronounced as inalienable and disposable.48

In view of the foregoing, the Court finds that Rev. Cortez failed to conclusively establish his claimed right
over the subject portion of Palaui Island as would entitle him to the issuance of a final injunction.