Assignment for 06 October 2020

1. SARMIENTO -Quiroz v. Nalus, G.R. No. 244054, March 11, 2020

2. TENORIO - PNB v. Aznar, G.R. No. 171805, May 30, 2011

PNB vs. Aznar

G.R. No. 171805  May 30, 2011

Topic: Judgment on the Pleadings

Facts: Rural Insurance and Surety Company, Inc. (RISCO) ceased operation due to
business reverses. In plaintiffs’ desire to rehabilitate RISCO, they contributed a total
amount of ₱212,720.00 which was used in the purchase of the three (3) parcels of land
and the titles were issued in the name of RISCO. The amount contributed by plaintiffs
constituted as liens and encumbrances on the aforementioned properties.

The President then explained that in a special meeting of the stockholders previously
called for the purpose of putting up certain amount of ₱212,720.00 for the rehabilitation
of the Company and that the respective contributions above-mentioned shall constitute
as their lien or interest on the property.

Thereafter, various subsequent annotations were made on the same titles, including the
Notice of Attachment and Writ of Execution both dated August 3, 1962 in favor of herein
defendant PNB.

As a result, a Certificate of Sale was issued in favor of Philippine National Bank, being
the lone and highest bidder of the three (3) parcels of land.

This prompted plaintiffs-appellees to file the instant complaint seeking the quieting of
their supposed title to the subject properties, declaratory relief, cancellation of TCT and
reconveyance with temporary restraining order and preliminary injunction. Plaintiffs
alleged that the subsequent annotations on the titles are subject to the prior annotation
of their liens and encumbrances.

Plaintiffs further contended that the subsequent writs and processes annotated on the
titles are all null and void for want of valid service upon RISCO and on them, as
stockholders.

Defendant PNB on the other hand countered that plaintiffs have no right of action for
quieting of title since the order of the court directing the issuance of titles to PNB had
already become final and executory and their validity cannot be attacked except in a
direct proceeding for their annulment.

Aznar, et al., filed a Manifestation and Motion for Judgment on the Pleadings on
October 5, 1998. Thus, the trial court rendered the November 18, 1998 Decision, which
ruled against PNB.
PNB appealed the adverse ruling to the Court of Appeals which set aside the judgment
of the trial court. Although the Court of Appeals agreed with the trial court that a
judgment on the pleadings was proper

Issue: Whether or not judgment on the pleadings by the RTC was proper

Ruling: No. The legal basis for rendering a judgment on the pleadings can be found in
Section 1, Rule 34 of the Rules of Court which states that "[w]here an answer fails to
tender an issue, or otherwise admits the material allegations of the adverse party’s
pleading, the court may, on motion of that party, direct judgment on such pleading. x x
x."

Judgment on the pleadings is, therefore, based exclusively upon the allegations
appearing in the pleadings of the parties and the annexes, if any, without consideration
of any evidence aliunde. However, when it appears that not all the material allegations
of the complaint were admitted in the answer for some of them were either denied or
disputed, and the defendant has set up certain special defenses which, if proven, would
have the effect of nullifying plaintiff’s main cause of action, judgment on the pleadings
cannot be rendered.

PNB also indicated in its Answer the special and affirmative defenses of (a) prescription;
(b) res judicata; (c) Aznar, et al., having no right of action for quieting of title; (d) Aznar,
et al.’s lien being ineffective and not binding to PNB; and (e) Aznar, et al.’s having no
personality to file the suit.

From the foregoing, it is indubitably clear that it was error for the trial court to render a
judgment on the pleadings and, in effect, resulted in a denial of due process on the part
of PNB because it was denied its right to present evidence. A remand of this case would
ordinarily be the appropriate course of action. However, in the interest of justice and in
order to expedite the resolution of this case which was filed with the trial court way back
in 1998, the Court finds it proper to already resolve the present controversy in light of
the existence of legal grounds that would dispose of the case at bar without necessity of
presentation of further evidence on the other disputed factual claims and defenses of
the parties.

3. TORRES - MARINA v. Marc Properties Corp., G.R. No. 173128, February 15, 2012

G.R. No. 173128               February 15, 2012

MARINA vs. MARC PROPERTIES CORPORATION, Respondent.

TOPIC: SUMMARY JUDGEMENT

FACTS

Petitioner MARINA represented by Sevilla, entered into a Contract of Lease with respondent
Marc Properties Corporation represented by Marquez. It was agreed that the MARINA offices
will be transferred from PPL Building, Taft Avenue, Manila to MARC Building and Condominium
Unit 5 of MARC 2000 Tower which are both owned by respondent

Respondent received a letter from Sevilla requesting for rescission of their Contract of Lease.
Respondent said it can only accept the request for rescission upon reimbursement of
₱1,055,000.00 representing the amount advanced by respondent and paid to its Contractors
and payment of penalty equivalent to 2 months rental or ₱2,527,215.48 in accordance with Art.
IX, Sec. 9.00 of the Contract of Lease.

In their letter-reply, petitioners asserted that MARINA is not liable to pay the penalty considering
that the Contract of Lease clearly provides that it is subject to the approval of the Board and the
Office of the President (OP) to become binding on the parties.

Respondent instituted Civil Case in the RTC against petitioners MARINA and/or Atty. Oscar M.
Sevilla.

Petitioners through the Solicitor General filed their Answer specifically denying the foregoing
allegations. Petitioners argued that respondent’s demand for ₱2,527,215.48 is based solely on
Art. V, Sec. 5.0 of the Contract of Lease, which provision presupposes the approval of the
contract which is subject to the suspensive condition provided in Art. XI, Sec. 11.13. Petitioners
contended that by claiming that there was no reason to reject the Contract of Lease considering
the "clear advantages" of approving the same, respondent is effectively imposing its judgment
on the Board of Directors and the OP; this simply cannot be done. Petitioners pointed out that
the approval or rejection of the contract is a prerogative lodged solely on the said authorities
and respondent is devoid of any authority to question the wisdom of the Board’s rejection of the
contract as obviously there were other considerations -- to which respondent is not privy --
factored in by the Board in its decision. Lastly, petitioners asserted that this being a suit against
the State, it must be dismissed outright as there was no allegation in the complaint that the
State had given its consent to be sued in this case.

Respondent filed a motion for summary judgment in its favor contending that there is no
genuine issue in this case as to any material fact even as to the amount of damages. Petitioners
filed their opposition alleging the existence of genuine factual issues which can only be resolved
in a full-blown trial on the merits.

Trial court issued an Order granting in part the motion for summary judgment.

Respondent then moved to set the case for pre-trial, which was granted. Meanwhile, petitioners
filed a motion for reconsideration arguing that while admittedly they had offered to pay the
respondent reimbursement for the alterations/renovations made on its building as shown by the
afore-mentioned letters of Administrator Sevilla, petitioners did not admit that such
alterations/renovations which respondent claims to have been prosecuted on the MARC
Building were actually made thereon and that such changes were in fact in accordance with the
plans prepared and provided for by MARINA. Petitioners stressed that these factual matters are
still to be determined which can only be done through a full-blown trial; the reimbursable amount
being also subject to verification since petitioners have not yet been given the opportunity to
independently confirm such amount. Further, it was contended that respondent’s submission of
accomplishment reports on the alterations/renovation works it claims to have been done and the
amount it allegedly expended do not automatically establish petitioners’ liability for the same.

CA dismissed petitioners’ appeal holding that the trial court’s rendition of partial summary
judgment was in accord with Section 1, Rule 35 of the 1997 Rules of Civil Procedure, as
amended, as it was based on petitioners’ admission in their Answer. In rejecting petitioners’
argument that they raised a genuine factual issue as to the reimbursable amount for the
renovation works, the CA stated:

As to the contention that defendant-appellant is entitled to verify first the authenticity,

genuineness and due execution of the documents (e.g., receipts) relative to the renovation,
suffice it to note that plaintiff-appellee had offered its evidence on 13 December 2002 or three
(3) months prior to the issuance of the contested order. Yet, defendant-appellant has never lift
its finger to challenge the authenticity, genuineness, and due execution of the said documents.
For this failure, it is established beyond cavil that there is no genuine issue as to any material
fact warranting thereby the issuance of a summary judgment.

ISSUE: WON the partial summary judgment is proper in this case

RULING

Summary judgment is a procedural device resorted to in order to avoid long drawn out
litigations and useless delays where the pleadings on file show that there are no genuine
issues of fact to be tried. A "genuine issue" is such issue of fact which require the
presentation of evidence as distinguished from a sham, fictitious, contrived or false
claim. There can be no summary judgment where questions of fact are in issue or where
material allegations of the pleadings are in dispute. A party who moves for summary
judgment has the burden of demonstrating clearly the absence of any genuine issue of
fact, or that the issue posed in the complaint is so patently unsubstantial as not to
constitute a genuine issue for trial, and any doubt as to the existence of such an issue is
resolved against the movant.

Contrary to the findings of the trial court and CA, the Answer filed by petitioners
contained a specific denial of absolute liability for the amount being claimed as actual
expenses for repairs/renovations works done on respondent’s building after the
execution of the Contract of Lease.

5. SPECIFICALLY DENY the allegation in paragraph 4 of the complaint that MARINA requested
for alterations/renovations in accordance with the plans prepared by MARINA on the MARC
building for the account of and at the expense of MARINA, the truth being those stated in the
Special and Affirmative Defenses hereof. They likewise SPECIFICALLY DENY the rest of the
allegations therein that said request alterations/renovations started on December 5, 2001 and
was done by the lowest bidders, JTV Construction Group, Inc., for civil works/renovations and
NCC Communication Networks, for wiring and cable installation, for which plaintiff allegedly
advanced/paid the sum of P1,555,170.40 for lack of knowledge or information sufficient to form
a belief as to the truth thereof.

xxxx

13. As an act of good faith, Atty. Sevilla, in behalf of MARINA, has offered to shoulder and pay
the actual expenses incurred for the works done on the premises based on MARINA’s request.
Moreover, defendants cannot allow plaintiff to collect from them the additional sum of
P2,527,215.48 which is equivalent to two (2) months rental as penalty simply because there is
no justification therefor.

x x x x28

Furthermore, petitioners averred in their Opposition to Plaintiff’s Motion for Summary Judgment
in Favor of Plaintiff:

With regard to the claim for reimbursement, plaintiff has yet to conclusively prove that the
alterations/renovations it claims to have been made in its building were actually made and that
the same were actually in accordance with the alleged request made by MARINA.

The reply-letter dated January 23, 2002 of defendant Sevilla in response to the letters of Ericson
Marquez dated December 17, 2001 and January 18, 2002, demanding reimbursements of the
alterations/renovation allegedly made upon its building, shows that it merely required Marquez
to show proof or receipt of the expenses plaintiff alleges it had incurred.

Likewise, the letter of defendant Sevilla dated July 1, 2002, this time in response to a similar
demand letter made by plaintiff’s counsel, Atty. Antonio Atienza, simply stated that defendants
have committed themselves to pay the actual expenses incurred by plaintiff as based on
MARINA’s request. The same offer was reiterated by defendants in paragraph 13 of their
answer to plaintiff’s complaint. It must be noted, however, that said offer specifically pertains
only to alterations/renovations which were actually made on plaintiff’s properties in accordance
with MARINA’s request.1âwphi1

Verily, defendants have yet to actually acquiesce to the veracity of the accomplishment
reports, receipt, etc. submitted by plaintiff since the same are still subject to verification
which can only be achieved through a full-blown trial.

As can be gleaned, the fact that Administrator Sevilla sent respondent letters wherein
MARINA offered to shoulder actual expenses for works done on the premises based on
MARINA’s request does not necessarily mean that petitioners had waived their right to
question the amount being claimed by the respondent.30 Since the factual basis of the
claim for reimbursement was not admitted by the petitioners, it is clear that the
resolution of the question of actual works done based on MARINA’s request, as well as
the correctness of the amount actually spent by respondent for the purpose, required a
trial for the presentation of testimonial and documentary evidence to support such claim.
The trial court therefore erred in granting summary judgment for the respondent. The
averments in the answer and opposition clearly pose factual issues and hence rendition
of summary judgment would be improper.

It must be stressed that trial courts have limited authority to render summary judgments
and may do so only when there is clearly no genuine issue as to any material fact. When
the facts as pleaded by the parties are disputed or contested, proceedings for summary
judgment cannot take the place of trial.31 As already stated, the burden of demonstrating
clearly the absence of genuine issues of fact rests upon the movant, in this case the
respondent, and not upon petitioners who opposed the motion for summary judgment.
Any doubt as to the propriety of the rendition of a summary judgment must thus be
resolved against the respondent. But here, the partial summary judgment was premised
merely on the trial court’s hasty conclusion that respondent is entitled to the
reimbursement sought simply because petitioners failed to point out what particular
works were not done or implemented not in accordance with MARINA’s specifications
after demands were made by respondent and the filing of the complaint in court.
Precisely, a trial is conducted after the issues have been joined to enable herein
respondent to prove, first, that repair/renovation works were actually done and such
were in accordance with MARINA’s request, and second, that it actually advanced the
cost thereof by paying the contractors; and more importantly, to provide opportunity for
the petitioners to scrutinize respondent’s evidence, cross-examine its witnesses and
present rebuttal evidence. Moreover, the trial court should have been more circumspect
in ruling on the motion for summary judgment, taking into account petitioners’ concern
for judicious expenditure of public funds in settling its liabilities to respondent.

4. VENEZUELA - Trade and Investment Development Corp. v. Philippine Veterans

Bank, G.R. No. 233850, July 1, 2019
TOPIC: SUMMARY JUDGMENT

FACTS: Respondent PVB alleged that, PVB, together with other banking institutions
(Series A Noteholders), entered into a Five-Year Floating Rate Note Facility Agreement5 (NFA)
with debtor Philippine Phosphate Fertilizer Corporation (PhilPhos), situated in Leyte, up to the
aggregate amount of P5 billion. To secure payment of the Series A Notes, petitioner TIDCORP,
with the express conformity of PhilPhos, executed a Guarantee Agreement (Guarantee
Agreement) whereby petitioner TIDCORP agreed to guarantee the payment of the guaranty
obligation to the extent of ninety (90%) of the outstanding Series A Notes, including interest, on
a rolling successive three-month period commencing on the first drawdown date and ending on
the maturity date of the Series A Notes. Thereafter, Typhoon Yolanda struck Leyte which
brought about the failure of PhilPhos to resume its operations. Consequently, PhilPhos filed a
Petition for Voluntary Rehabilitation which was, together with a Stay Order, granted. Pursuant to
the Guarantee Agreement, respondent PVB filed its Notice of Claim with petitioner TIDCORP.
However, TIDCORP refused to comply, contending that the RTC issued a Stay Order for all
claims against PhilPhos. Thus, PVB filed a complaint for specific performance against
TIDCORP pursuant to the Guarantee Agreement. TIDCORP answered that RTC cannot validly
try the case because of the Rehabilitation Court’s Stay Order. In view of the answer, PVB filed a
motion for summary judgment. The RTC granted the motion. Hence, this case. Petitioner
TIDCORP contends that respondent PVB is not entitled to judgment as a matter of law and that
there are genuine issues on material facts that necessitate trial on the merits, contrary to the
findings of the RTC.

ISSUE: W/N THE GRANT OF THE MOTION FOR SUMMARY JUDGMENT IS PROPER.

HELD: YES. First and foremost, it must be noted that the Stay Order relied upon by
petitioner TIDCORP merely ordered the staying and suspension of enforcement of all claims
and proceedings against the petitioner PhilPhos and not against all the other persons or entities
solidarily liable with the debtor. The tenor of the Stay Order itself belies the theory of petitioner
TIDCORP. According to the Stay Order, the said order only covers "all claims, actions, or
proceedings against the petitioner [referring to debtor PhilPhos]. 

With respect to petitioner TIDCORP's second argument, the Court likewise concurs with the
RTC's finding that upon examination of the records of the instant case, there was no genuine
issue raised as to a material fact.
There is no "genuine issue" which calls for the presentation of evidence if the issues
raised by a party are sham, fictitious, contrived, set up in bad faith and patently
unsubstantial so as not to constitute a genuine issue for trial. The court can determine this
on the basis of the pleadings, admissions, documents, affidavits and/or counter-affidavits
submitted by the parties to the court. In a collection case, where the obligation and the fact of
nonfulfillment of the obligation, as well as the execution of the debt instrument, are admitted by
the debtor, with the rate of interest and/or amount of damages being the only remaining issue,
there is no genuine issue and a summary judgment may be rendered upon proper motion.

In the instant case, as correctly pointed out by the RTC, petitioner TIDCORP readily admitted
that it was bound by the Guarantee Agreement, which expressly obligated petitioner
TIDCORP to guarantee the payment of the Guaranty obligation, which was specifically
pegged at 90% of the outstanding Series A Notes. With petitioner TIDCORP admitting that it
was "bound by the terms and conditions enumerated in this Guarantee Agreement and such
other related documents x x x," the RTC did not commit any error in holding that respondent
PVB was entitled to judgment as a matter of law.

Jurisprudence holds that "the defendant must show that he has a bona fide defense to
the action, one which he may be able to establish. It must be a plausible ground of defense,
something fairly arguable and of a substantial character. This he must show by affidavits or
other proof."

The RTC was correct in holding that petitioner TIDCORP failed to proffer a plausible ground of
defense of a substantial character, considering that in its Answer, the only special and/or
affirmative defense raised by petitioner TIDCORP was the argument on the lack of jurisdiction of
the RTC in light of the Rehabilitation Court's Stay Order, which as previously discussed, is an
erroneous assertion.

Further, petitioner TIDCORP's argument on its denial of receiving a Notice of Claim with
attachments from respondent PVB in accordance with the Guarantee Agreement is manifestly
unmeritorious, considering that its letters dated November 12, 2015 and January 27, 201654
expressly acknowledged the fact that they received the said Notice of Claim on November 6,
2015. Petitioner TIDCORP is bound by such admissions.

Also telling is the fact that in its correspondence with respondent PVB, petitioner TIDCORP
consistently failed to assail the correctness and completeness of the Notice of Claim. Its denial
of respondent PVB's Notice of Claim was confined merely to its allegation that it was precluded
by the Rehabilitation Court's Stay Order from acting on the claim.

Hence, taking together the fact that petitioner TIDCORP expressly admitted its obligations under
the Guarantee Agreement, and that it failed to offer any substantial defense against the claim of
respondent PVB, the RTC was not in error in holding that there is no genuine issue as to a
material fact extant in the instant case.

5. ZENAL - Globe Asiatique Realty. v. Union Bank, G.R. No. 229339, July 29, 2019
6. LALATADasmariñas Garments, Inc. v. Reyes, G.R. No. 108229, August 24, 1993

7.  PACAANAS - Fortune Corp. v. CA, G.R. No. 108119, January 19, 1994
Fortune Corp. v. CA
G.R. No. 108119
January 19, 1994

FACTS:

An action for breach of contract was filed by petitioner Fortune Corporation against respondent
Inter-Merchants Corporation, docketed as Civil Case No. SP-3469, before the Regional Trial
Court of San Pablo City, Branch 30. After respondent corporation had filed its Answer, petitioner
served the former with written interrogatories pursuant to Rule 25 of the Rules of Court. The
interrogatories were answered by respondent corporation through its board chairman, Juanito A.
Teope.

The pre-trial conference was thereafter scheduled for January 9, February 12 and April 22,
1992.

On March 26, 1992, however, petitioner served upon private respondent a Notice to Take
Deposition Upon Oral Examination2 dated March 26, 1992, notifying the latter that on April 7,
1992, at San Pablo City, herein petitioner would take the deposition of said Juanito A. Teope, in
accordance with Section 15, Rule 24.

Private respondent filed an Urgent Motion Not To Take Deposition/Vehement Opposition to

Plaintiff's Notice to Take Deposition Upon Oral Examination, dated March 27, 1992, alleging
inter alia that : (a) herein petitioner has previously availed of one mode of discovery, that is, the
written interrogatories which practically covered all the claims, counterclaims and defenses in
the case; (b) there is absolutely no sound reason or justification advanced for the taking of the
oral deposition; (c) such taking would cause annoyance, embarrassment and oppression upon
the prospective deponent, Juanito A. Teope; (d) Mr. Teope has no intention of leaving the
country; and 
(e) the intended deponent is available to testify in open court if required during the trial on the
merits.

The trial court thereafter issued on April 3, 1992 an order that the requested deposition shall not
be taken. Its motion for reconsideration having been denied, petitioner filed an original action for
certiorari before the Supreme Court which was docketed as G.R. No. 101526. However, in a
resolution dated May 20, 1992, this Court referred the case to the Court of Appeals for
consideration and adjudication on the merits. CA affirmed the order of the RTC disallowing the
taking of the oral deposition of Juanito S. Tope, hence, this petition. 

ISSUE: 

Whether or not, absent the requisite element of "good cause" as mandated by Section 16 of
Rule 24, Rules of Court, a trial court has unbridled discretion to forbid the taking of deposition
upon oral examination as authorized under Rule 24, Section 15, Rules of Court.

HELD:

No. Section 16 of Rule 24 provides that after notice is served for taking a deposition by oral
examination, upon motion seasonably made by any party or by the person to be examined and
upon notice and for good cause shown, the court in which the action is pending may, among
others, make an order that the deposition shall not be taken.

This provision explicitly vests in the court the power to order that the deposition shall not be
taken and this grant connotes the authority to exercise discretion in connection therewith. It is
well settled, however, that the discretion conferred by law is not unlimited: that it must be
exercised, not arbitrarily, capriciously, or oppressively, but in a reasonable manner and in
consonance with the spirit of the law, to the end that its purpose may be attained. 

Section 16 of Rule 24 clearly states that it is only upon notice and for good cause that the court
may order that the deposition shall not be taken. The matter of good cause is to be determined
by the court in the exercise of judicial discretion. Good cause means a substantial reason —
one that affords a legal excuse. Whether or not substantial reasons exist is for the court to
determine, as there is no hard and fast rule for determining the question as to what is meant by
the term "for good cause shown." 

8. RAMOS - Jonathan Landoil Int’l Co., Inc. v. Mangudadatu, G.R. No. 155010, August 16,
2004
Topic: Deposition 
Facts:

Spouses Mangudadatus filed with the RTC Sultan Kudarat, a complaint for damages
against JLI. During the pre-trial, JLI failed to appear and was thus declared in default. As a
result, JLI filed an Omnibus Motion for New Trial and Change of Venue. This was eventually
denied by the Court and a Writ of Execution was issued against them.

JLI filed a Motion to Quash/Recall Writ of Execution since  they  were  not  able  to 
receive  a  copy  of  an  order resolving their motion for new trial. To make matters worse, their
counsels, Attys. Mario Jr. and Peligro submitted withdrawals of appearance. They were
replaced by new lawyers and the affidavits of Mario and Peligro attesting that they had not yet
received a copy of the Order resolving the Motion for New Trial were attached. JLI then received
a notice regarding the public auction sale of their properties.

The RTC ordered the Mangudadatus to comment on the motion to quash filed by JLI. In
their comment, they attached two separate Certifications supposedly issued by the postmaster
of Tacurong City, affirming that the Order denying the Motion for New Trial had been received
by Mario and Peligro. To clear things up, counsel for JLI personally served counsel for the
Mangudadatus a Notice to Take Deposition upon Oral Examination of Attys. Mario and Peligro.
The Deposition was intended to prove that JLI had not received a copy of the Order denying the
Motion for New Trial. Thus, the depositions of their former counsels were taken. The RTC
denied JLI’s motion to quash. The CA ruled that JLI could no longer avail itself of a deposition
under Rule 23 of Rules of Court, since trial had already been terminated (because a decision
was rendered after JLI’s default).

Issue: Can JLI avail of the depositions of their former counsels despite the case being
terminated? 
Held: Yes, JLI can avail of the depositions of their former counsels despite the case being
terminated.

A deposition may be taken with leave of court after jurisdiction has been obtained
over any defendant or over property that is the subject of the action; or, without such
leave, after an answer has been served. Deposition is chiefly a mode of discovery, the
primary function of which is to supplement the pleadings for the purpose of disclosing the real
points of dispute between the parties and affording an adequate factual basis during the
preparation for trial.

The Rules of Court and jurisprudence, however, do not restrict a deposition to the sole
function of being a mode of  discovery  before  trial.  Under  certain  conditions  and  for certain
limited purposes, it may be taken even after trial has commenced and may be used without the
deponent being actually called to the witness stand. Thus, "[d]epositions may be taken at any
time after the institution of any action, whenever necessary or convenient. There is no
rule that limits deposition-taking only to the period of pre-trial or before it; no prohibition
against the taking of depositions after pre-trial.”

  Depositions are allowed, provided they are taken in accordance with the provisions of
the Rules of Court (that is, with leave of court if the summons have been served, without leave
of court if an answer has been submitted); and provided, further, that a circumstance for their
admissibility exists (Section 4, Rule 23, Rules of Court).The Rules of Court vest in the trial court
the discretion to order whether a deposition may be taken or not under specified circumstances
that may even differ from those the proponents have intended. However, it is well-settled that
this discretion is not unlimited. It must be exercised -- not arbitrarily, capriciously or oppressively
-- but in a reasonable manner and in consonance with the spirit of the law, to the end that its
purpose may be attained.

In this case, the depositions involved a circumstance that fell under Section 4(c)(2) of
Rule 23.1 The witnesses of JLI in Metro Manila resided beyond 100 kilometers from Sultan
Kudarat, the place of hearing. JLI offered the depositions in support of its Motion to Quash (the
Writ of Execution) and for the purpose of proving that the trial court’s Decision was not yet final.
As previously explained, despite the fact that the trial has already been terminated, a deposition
can still be properly taken.

9. SARMIENTO - San Luis v. Rojas, G.R. No. 159127, March 3, 2008

10. TENORIO - Rosete v. Lim, G.R. No. 136051, June 8, 2007

Rosete vs. Lim

G.R. No. 136051  June 8, 2006

Topic: Deposition

Facts: Respondents Juliano Lim and Lilia Lim filed before the RTC of Quezon City a
Complaint for Annulment, Specific Performance with Damages against AFP Retirement
and Separation Benefits System (AFP-RSBS), Espreme Realty and Development
Corporation (Espreme Realty), Alfredo P. Rosete, Maj. Oscar Mapalo, Chito P. Rosete,
Bank of the Philippine Islands (BPI), and Register of Deeds of the Province of Mindoro
Occidental.
Petitioners filed a Motion to Dismiss on the grounds that the court has no jurisdiction
over the subject matter of the action or suit and that venue has been improperly laid.

The Motions to Dismiss filed by all the defendants were denied.

Petitioner Chito Rosete filed his Supplemental Answer (Ex Abudanti Cautela)

Respondents filed a Notice to Take Deposition Upon Oral Examination giving notice that
on June 18 and 20, 1997 at 9:00 a.m., they will cause the deposition of petitioners
Oscar Mapalo and Chito Rosete.

Petitioners filed an Urgent Ex-Parte Motion and Objection to Take Deposition Upon Oral
Examination. They argued that the deposition may not be taken without leave of court
as no answer has yet been served and the issues have not yet been joined since their
Answer was filed ex abudanti cautela, pending resolution of the Petition for Certiorari
challenging the orders dated 12 March 1996 and 24 May 1996 that denied their Motions
to Dismiss and for Reconsideration, respectively.

The lower court denied petitioners’ motion and objection to take deposition upon oral
examination, and scheduled the taking thereof.

Petitioners Mapalo and Chito Rosete refuse to have their depositions taken in the civil
case because they allegedly would be incriminating themselves in the criminal cases
because the testimony that would be elicited from them may be used in the criminal
cases.

The Court of Appeals dismissed the Petition for Certiorari and Prohibition, and upheld
the Orders of the lower court.

Issue: Whether or not taking of oral depositions should not be allowed without leave of
court as no answer has yet been served and the issues have not yet been joined
because their answers were filed ex abudanti cautela (“out of abundant caution”. This
explains why lawyers use many words where few may be enough because it is believed that it is
better to use as many words as possible so as not to leave any room for guess concerning what
is being expressed.)

Ruling: Section 1 of Rule 24 of the Revised Rules of Court reads:

Section 1. Depositions pending action, when may be taken. – By leave of

court after jurisdiction has been obtained over any defendant or over
property which is the subject of the action, or without such leave after an
answer has been served, the testimony of any person, whether a party or
 not, may be taken, at the instance of any party, by deposition upon oral
examination or written interrogatories. The attendance of witnesses may be
compelled by the use of a subpoena as provided in Rule 23. Depositions
shall be taken only in accordance with these rules. The deposition of a
person confined in prison may be taken only by leave of court on such terms
as the court prescribes.

From the quoted section, it is evident that once an answer has been served, the
testimony of a person, whether a party or not, may be taken by deposition upon oral
examination or written interrogatories. In the case before us, petitioners contend they
have not yet served an answer to respondents because the answers that they have filed
with the trial court were made ex abudanti cautela. In other words, they do not consider
the answers they filed in court and served on respondents as answers contemplated by
the Rules of Court on the ground that same were filed ex abudanti cautela.

The Supreme Court finds petitioners’ contention to be untenable. Ex abudanti cautela

means "out of abundant caution" or "to be on the safe side." An answer ex abudanti
cautela does not make their answer less of an answer. A cursory look at the answers
filed by petitioners shows that they contain their respective defenses.

A deposition pending action may be availed of: (1) with leave of court when an answer
has not yet been filed but after jurisdiction has been obtained over any defendant or
property subject of the action, or (2) without leave of court after an answer to the
complaint has been served. In the instant case, the taking of the deposition may be
availed of even without leave of court because petitioners have already served their
answers to the complaint.

11. TORRES - Vda. de Manguerra v. Risos, G.R. No. 152643, August 28, 2008

G.R. No. 152643             August 28, 2008

VDA. DE MANGUERRA vs. RAUL RISOS

TOPIC: DEPOSITION

FACTS

Respondents were charged with Estafa Through Falsification of Public Document before the
RTC of Cebu City through a criminal information which was subsequently amended. The case
arose from the falsification of a deed of real estate mortgage allegedly committed by
respondents where they made it appear that Concepcion, the owner of the mortgaged property
known as the Gorordo property, affixed her signature to the document. Hence, the criminal
case. 6

Concepcion, who was a resident of Cebu City, while on vacation in Manila, was unexpectedly
confined at the Makati Medical Center due to upper gastro-intestinal bleeding; and was advised
to stay in Manila for further treatment. Counsel of Concepcion filed a motion to take the latter’s
7
deposition. He explained the need to perpetuate Concepcion’s testimony due to her weak
11

physical condition and old age, which limited her freedom of mobility.

RTC granted the motion and directed that Concepcion’s deposition be taken before the Clerk of
Court of Makati City. The court ratiocinated that procedural technicalities should be brushed
aside because of the urgency of the situation, since Concepcion was already of advanced age.
After several motions for change of venue of the deposition-taking, Concepcion’s deposition
was finally taken at her residence.14

CA rendered a Decision favorable to the respondents. This notwithstanding, the appellate court
16

resolved the matter on its merit, declaring that the examination of prosecution witnesses, as in
the present case, is governed by Section 15, Rule 119 of the Revised Rules of Criminal
Procedure and not Rule 23 of the Rules of Court. The latter provision, said the appellate court,
only applies to civil cases. Pursuant to the specific provision of Section 15, Rule 119,
Concepcion’s deposition should have been taken before the judge or the court where the case
is pending, which is the RTC of Cebu, and not before the Clerk of Court of Makati City; and
thus, in issuing the assailed order, the RTC clearly committed grave abuse of discretion. In its
Resolution denying petitioner’s motion for reconsideration, the CA added that the rationale of
the Rules in requiring the taking of deposition before the same court is the constitutional right of
the accused to meet the witnesses face to face. The appellate court likewise concluded that
Rule 23 could not be applied suppletorily because the situation was adequately addressed by a
specific provision of the rules of criminal procedure.
19

ISSUE

WHETHER OR NOT RULE 23 OF THE 1997 RULES OF CIVIL PROCEDURE APPLIES

TO THE DEPOSITION OF PETITIONER.

RULING

It is basic that all witnesses shall give their testimonies at the trial of the case in the
presence of the judge. This is especially true in criminal cases in order that the accused
25

may be afforded the opportunity to cross-examine the witnesses pursuant to his

constitutional right to confront the witnesses face to face. It also gives the parties and
26

their counsel the chance to propound such questions as they deem material and
necessary to support their position or to test the credibility of said witnesses. Lastly, 27

this rule enables the judge to observe the witnesses’ demeanor. 28

This rule, however, is not absolute. As exceptions, Rules 23 to 28 of the Rules of Court
provide for the different modes of discovery that may be resorted to by a party to an
action. These rules are adopted either to perpetuate the testimonies of witnesses or as
modes of discovery. In criminal proceedings, Sections 12, 13 and 15, Rule 119 of the
29 30 31

Revised Rules of Criminal Procedure, which took effect on December 1, 2000, allow the
conditional examination of both the defense and prosecution witnesses.

In the case at bench, in issue is the examination of a prosecution witness, who,

according to the petitioners, was too sick to travel and appear before the trial court.
Section 15 of Rule 119 thus comes into play, and it provides:

Section 15. Examination of witness for the prosecution. – When it satisfactorily

appears that a witness for the prosecution is too sick or infirm to appear at the
 trial as directed by the court, or has to leave the Philippines with no definite date
of returning, he may forthwith be conditionally examined before the court where
the case is pending. Such examination, in the presence of the accused, or in his
absence after reasonable notice to attend the examination has been served on
him, shall be conducted in the same manner as an examination at the trial. Failure
or refusal of the accused to attend the examination after notice shall be
considered a waiver. The statement taken may be admitted in behalf of or against
the accused.

Petitioners contend that Concepcion’s advanced age and health condition exempt her from the
application of Section 15, Rule 119 of the Rules of Criminal Procedure, and thus, calls for the
application of Rule 23 of the Rules of Civil Procedure.

The contention does not persuade.

The very reason offered by the petitioners to exempt Concepcion from the coverage of Rule 119
is at once the ground which places her squarely within the coverage of the same provision. Rule
119 specifically states that a witness may be conditionally examined: 1) if the witness is too sick
or infirm to appear at the trial; or 2) if the witness has to leave the Philippines with no definite
date of returning. Thus, when Concepcion moved that her deposition be taken, had she not
been too sick at that time, her motion would have been denied. Instead of conditionally
examining her outside the trial court, she would have been compelled to appear before the court
for examination during the trial proper.

Undoubtedly, the procedure set forth in Rule 119 applies to the case at bar. It is thus
required that the conditional examination be made before the court where the case is
pending. It is also necessary that the accused be notified, so that he can attend the
examination, subject to his right to waive the same after reasonable notice. As to the
manner of examination, the Rules mandate that it be conducted in the same manner as
an examination during trial, that is, through question and answer.

At this point, a query may thus be posed: in granting Concepcion’s motion and in
actually taking her deposition, were the above rules complied with? The CA answered in
the negative. The appellate court considered the taking of deposition before the Clerk of
Court of Makati City erroneous and contrary to the clear mandate of the Rules that the
same be made before the court where the case is pending . Accordingly, said the CA, the
RTC order was issued with grave abuse of discretion.

We agree with the CA and quote with approval its ratiocination in this wise:

Unlike an examination of a defense witness which, pursuant to Section 5, Rule 119 of

the previous Rules, and now Section 13, Rule 119 of the present Revised Rules of
Criminal Procedure, may be taken before any "judge, or, if not practicable, a member of
the Bar in good standing so designated by the judge in the order, or, if the order be
made by a court of superior jurisdiction, before an inferior court to be designated
therein," the examination of a witness for the prosecution under Section 15 of the
Revised Rules of Criminal Procedure (December 1, 2000) may be done only "before the
court where the case is pending." 32

Rule 119 categorically states that the conditional examination of a prosecution witness shall be
made before the court where the case is pending. Contrary to petitioners’ contention, there is
nothing in the rule which may remotely be interpreted to mean that such requirement applies
only to cases where the witness is within the jurisdiction of said court and not when he is
kilometers away, as in the present case. Therefore, the court may not introduce exceptions or
conditions. Neither may it engraft into the law (or the Rules) qualifications not contemplated. 33

When the words are clear and categorical, there is no room for interpretation. There is only
room for application.

To reiterate, the conditional examination of a prosecution witness for the purpose of taking his
deposition should be made before the court, or at least before the judge, where the case is
pending. Such is the clear mandate of Section 15, Rule 119 of the Rules. We find no necessity
to depart from, or to relax, this rule. As correctly held by the CA, if the deposition is made
elsewhere, the accused may not be able to attend, as when he is under detention. More
importantly, this requirement ensures that the judge would be able to observe the witness’
deportment to enable him to properly assess his credibility. This is especially true when the
witness’ testimony is crucial to the prosecution’s case.

While we recognize the prosecution’s right to preserve its witness’ testimony to prove its case,
we cannot disregard rules which are designed mainly for the protection of the accused’s
constitutional rights. The giving of testimony during trial is the general rule. The conditional
examination of a witness outside of the trial is only an exception, and as such, calls for a strict
construction of the rules.

12. VENEZUELA - Concrete Aggregates v. Court of Appeals, G.R. No. 117574, January
2, 1997
TOPIC: ADMISSION BY ADVERSE PARTY; SUMMARY JUDGMENT

FACTS: Petitioner contracted the security services of private respondent. A year after, the
former terminated the services of the latter for its failure to prevent and investigate the theft that
occured in its business premises. Private respondent filed an action for the collection of unpaid
fees for services rendered to petitioner. Petitioner contended that its refusal to pay was justified
because private respondent was answerable for the losses it incurred arising from the theft
attributable to her fault. Petitioner sent private respondent a Request for Admission by the latter
of her responsibility of the theft. Thereafter private respondent through counsel filed a
Manifestation and Reply to the Request for Admission. It was not under oath.
Petitioner filed a Motion for Summary Judgment positing that private respondent
impliedly admitted the matters set forth in the Request for Admission by failing to respond under
oath as required under Sec. 2, Rule 26, of the Rules of Court. Petitioner contended that the
manifestation and reply not being verified was ineffectual and thus should be stricken off the
records. Private respondent countered that her reply although not under oath effectively denied
the matters set forth in the request. However, the RTC ruled in favor of the private respondent.
Hence, this case. 

ISSUE: W/N private respondent may be considered to have impliedly admitted the
matters referred to in the request when she filed a manifestation and reply that was not under
oath.

HELD: NO. The Request for Admission of petitioner does not fall under Rule 26 of the
Rules of Court. As we held in Po v. Court of Appeals 9 and Briboneria v. Court of Appeals, 10
Rule 26 as a mode of discovery contemplates interrogatories that would clarify and tend to shed
light on the truth or falsity of the allegations in a pleading. That is its primary function. It does not
refer to a mere reiteration of what has already been alleged in the pleadings.

A cursory reading of petitioner’s Request for Admission clearly shows that it contains the same
material averments in his Answer to respondent’s Complaint in the trial court. Petitioner merely
recopied or reproduced in its Request for Admission its affirmative defenses and counterclaims
alleged in its Answer. As we held in Po v. CA, 11 petitioner’s request constitutes an utter
redundancy and a useless, pointless process which the respondent should not be subjected to.
In the first place, what the petitioner seeks to be admitted by private respondent is the very
subject matter of the complaint. In effect, petitioner would want private respondent to deny her
allegations in her verified Complaint and admit the allegations in the Answer of petitioner
(Manifestation and Reply to Request for Admission). Plainly, this is illogical if not preposterous.
Respondent cannot be said to have admitted the averments in the Answer of petitioner just
because she failed to have her response to the request placed under oath since these are the
very matters she raises in her verified Complaint in the court below.

Clearly, therefore, private respondent need not reply to the Request for Admission because her
Complaint itself controverts the matters set forth in the Answer of petitioner which were merely
reproduced in the request. In Uy Chao v. De la Rama Steamship 13 we observed that the
purpose of the rule governing requests for admission of facts and genuineness of documents is
to expedite trial and to relieve parties of the costs of proving facts which will not be disputed on
trial and the truth of which can be ascertained by reasonable inquiry.

To this we add that a party should not be made to deny matters already averred in his
complaint. At this point, it is necessary to emphasize what this Court laid down in the same Po
and Briboneria cases —

A request for admission is not intended to merely reproduce or reiterate the allegations of the
requesting party’s pleading but should set forth relevant evidentiary matters of fact, or
documents described in and exhibited with the request, whose purpose is to establish said
party’s cause of action or defense. 15

Since the answer of private respondent to the request is no longer required in the instant case, it
therefore becomes unnecessary to dwell on the issue of the propriety of an answer that is not
under oath. Even assuming that a response to the request is needed, private respondent had
already substantially complied with the requirement of the law when she specifically denied the
material allegations of the petitioner in her Manifestation and Reply to the Request for
Admission. Although not under oath the reply to the request readily showed that the intent of
private respondent was to deny the matters set forth in the Request for Admission. That the
reply is not under oath is merely a formal and not a substantive defect. This procedural lapse
may be dispensed with if the circumstances call for the dispensing of the rule in the interest of
justice. While we commend petitioner’s zeal in promoting faithful adherence to the rules of
procedure we cannot ignore the well-entrenched doctrine that all pleadings should be liberally
construed as to do substantial justice. 

There being genuine issues of fact between the private parties, public respondents correctly
denied the motion of petitioner for summary judgment. Where facts pleaded by the parties are
disputed or contested proceedings for summary judgment cannot take the place of trial. 17 Trial
courts have limited authority to render summary judgments and may do so only when there is
clearly no genuine issue as to any material fact. Verily, there is a need to determine by
presentation of evidence if respondent is really liable for the stolen articles and for violating its
contract for security services with petitioner. Until these issues are determined no legal
compensation can take place between the parties. This factual dispute can only be resolved by
trying the case on the merits, a process which need not take long to conclude.
13. ZENAL - Spouses Afulugencia v. Metrobank, G.R. No. 185145, February 5, 2014
14. LALATA - PSCFC Financial Corp. v. Court of Appeals, G.R. No. 106094, December 28,
1992

15. PACAANAS - Po v. Court of Appeals, G.R. No. L-34341, 22 August 1988

Po v Court of Appeals
G. R. no. L-34341
August 22, 1988

DOCTRINE:

Rule 26 contemplates interrogatories that would clarify and tend to show light on the truth or
falsity of the allegations of the complaint, and does not refer to a mere reiteration of what has
been alleged in the complaint and unconditionally denied in the answer.

FACTS:

The petitioner filed in 1971 a complaint for P35,000 damages against the private respondent
Jose P. Mananzan as operator of a banca service for shooting the rapids at Pagsanjan Falls,
arising from an accidental spill into the water, which she and her friend suffered when the banca
in which they were riding capsized during their trip back to town. After Mananzan had answered
the complaint, petitioner served upon him a request for admission.

On February 27, 1971, Mananzan asked for an extension of time to answer the request for
admission. The petitioner opposed the motion for extension of time on account of alleged
defects in the notice of hearing.

On March 4, 1971, the petitioner filed a motion for summary judgment on the ground that there
exists no genuine or substantial controversy on any issue of fact raised in the complaint
because the defendant, by failure to answer her request for admission within the reglementary
period (Sec. 2, Rule 26, Rules of Court) is deemed to have admitted the facts set forth in the
request.

Mananzan answered the request for admission and sent a copy of his answer to the petitioner.
He filed an opposition to the petitioner's motion for summary judgment.

On April 16, 1971, respondent Judge Lustre denied the motion for summary judgment,
observing that "the interrogatories ... are nothing but a reiteration of a portion of the plaintiffs
allegations in the complaint, which have already been answered and denied by the defendant in
his answer" hence, they "need not be answered again if asked in the form of interrogatories."

ISSUE:
Whether or not there exists a substantial controversy on any issue of fact raised in the complaint
by the defendant

HELD:

An examination of petitioner's complaint and her request for admission confirms Judge Lustre's
finding (which the Court of Appeals upheld) that the "fact" set forth in the request for admission,
including the amount of damages claimed, are the same factual allegations set forth in her
complaint which the defendant either admitted or denied in his answer.

A party should not be compelled to admit matters of fact already admitted by his pleading and
concerning which there is no issue (Sherr vs. East, 71 A2d 752, Terry 260, cited in 27 C.J.S.
91), nor should he be required to make a second denial of those already denied in his answer to
the complaint. A request for admission is not intended to merely reproduce or reiterate the
allegations of the requesting party's pleading but should set forth relevant evidentiary matters of
fact, or documents described in and exhibited with the request, whose purpose is to establish
said party's cause of action or defense. Unless it serves that purpose, it is, as correctly
observed by the Court of Appeals, "pointless, useless," and "a mere redundancy."

16. RAMOS  - Spouses Villuga v. Kelly Hardware, G.R. No. 176570, July 18, 2012

Topic: Summary Judgment

Facts:  RESP filed with the RTC of Bacoor, Cavite a Complaint for a Sum of Money and
Damages against herein petitioners.ιrâ¹brαrÿ

Respondent filed a Motion to Expunge with Motion for Summary Judgment claiming that
petitioners' Comments on respondent's Request for Admission is a mere scrap of paper as
it was signed by petitioners' counsel and not by petitioners themselves and that it was
filed beyond the period allowed by the Rules of Court. Respondent goes on to assert that
petitioners, in effect, were deemed to have impliedly admitted the matters subject of the said
request. Respondent also contended that it is already entitled to the issuance of a
summary judgment in its favor as petitioners not only failed to tender a genuine issue as
to any material fact but also did not raise any special defenses, which could possibly relate
to any factual issue.

In their Opposition to Motion to Expunge with Motion for Summary Judgment, petitioners
argued that respondent's request for admission is fatally defective, because it did not indicate or
specify a period within which to answer; that verification by petitioners' counsel is sufficient
compliance with the Rules of Court; that petitioners' request for admission should be deemed
dispensed with and no longer taken into account as it only relates to the Amended Complaint,
which was already abandoned when the Second Amended Complaint was filed; and that
summary judgment is improper and without legal basis, as there exists a genuine controversy
brought about by petitioners' specific denials and defenses.

RTC granted Plaintiff's [herein respondent's] Motion to Expunge with Motion for
Summary Judgment.
 Defendants' Petitioners "Comments on the Request for Admission" is hereby expunged
from the record for being contrary to the Rules of Court. Judgment is rendered in favor of the
plaintiff and against the defendants. Defendants are ordered to pay the plaintiff.

Petitioners filed a Motion for Reconsideration, but it was denied by the RTC.

Petitioner filed an appeal with the CA but the latter affirmed RTC order.

Petitioners' Motion for Reconsideration was subsequently denied by the CA.

Hence, the instant Petition for Review on Certiorari. ‚Î ¹brαrÿ

ISSUE: WON the summary judgment issued by the RTC is improper and without legal bases,
considering that genuine issues were raised in the pleadings filed by petitioners.

Held: The petition lacks merit.

CA was correct in sustaining the summary judgment rendered by the RTC.

Sections 1 and 3, Rule 35 of the Rules of Court provide as follows:ςrαlαω

Section 1. Summary judgment for claimant. A party seeking to recover upon a

claim, counterclaim, or cross-claim or to obtain a declaratory relief may, at any
time after the pleading in answer thereto has been served, move with supporting
affidavits, depositions or admissions for a summary judgment in his favor upon all
or any part thereof.

Section 3. Motion and proceedings thereon. The motion shall be served at least
ten (10) days before the time specified for the hearing. The adverse party may
serve opposing affidavits, depositions, or admissions at least three (3) days
before the hearing. After the hearing, the judgment sought shall be rendered
forthwith if the pleadings, supporting affidavits, depositions, and admissions on
file, show that, except as to the amount of damages, there is no genuine issue as
to any material fact and that the moving party is entitled to a judgment as a
matter of law.

Summary judgment is a procedural device resorted to in order to avoid long drawn out
litigations and useless delays. Such judgment is generally based on the facts proven summarily
by affidavits, depositions, pleadings, or admissions of the parties. ςrνll

The Court's ruling in Nocom v. Camerino, is instructive, to wit:Ï‚rÎ x x x When the

pleadings on file show that there are no genuine issues of fact to be tried, the Rules of Court
allow a party to obtain immediate relief by way of summary judgment, that is, when the facts are
not in dispute, the court is allowed to decide the case summarily by applying the law to the
material facts. Conversely, where the pleadings tender a genuine issue, summary judgment is
not proper. A "genuine issue" is such issue of fact which requires the presentation of evidence
as distinguished from a sham, fictitious, contrived or false claim. Section 3 of [Rule 35 of the
Rules of Court] provides two (2) requisites for summary judgment to be proper: (1) there must
be no genuine issue as to any material fact, except for the amount of damages; and (2) the
party presenting the motion for summary judgment must be entitled to a judgment as a matter of
law. A summary judgment is permitted only if there is no genuine issue as to any material fact
and a moving party is entitled to a judgment as a matter of law. A summary judgment is proper
if, while the pleadings on their face appear to raise issues, the affidavits, depositions, and
admissions presented by the moving party show that such issues are not genuine.

In the present case, it bears to note that in its original Complaint, as well as in its
Amended Complaint, respondent did not allege as to how petitioners' partial payments of
P110,301.80 and P20,000.00 were applied to the latter's obligations. In fact, there is no
allegation or admission whatsoever in the said Complaint and Amended Complaint that such
partial payments were made. Petitioners, on the other hand, were consistent in raising their
affirmative defense of partial payment in their Answer to the Complaint and Answer to Amended
Complaint. Having pleaded a valid defense, petitioners, at this point, were deemed to have
raised genuine issues of fact.

The situation became different, however, when respondent subsequently filed its Second
Amended Complaint admitting therein that petitioners, indeed, made partial payments of
P110,301.80 and P20,000.00. Nonetheless, respondent accounted for such payments by
alleging that these were applied to petitioners' obligations which are separate and distinct from
the sum of P259,809.50 being sought in the complaint. This allegation was not refuted by
petitioners in their Answer to Second Amended Complaint. Rather, they simply insisted on their
defense of partial payment while claiming lack of knowledge or information to form a belief as to
the truth of respondent's allegation that they still owe the amount of P259,809.50 despite their
payments of P110,301.80 and P20,000.00. It is settled that the rule authorizing an answer to the
effect that the defendant has no knowledge or information sufficient to form a belief as to the
truth of an averment and giving such answer the effect of a denial, does not apply where the
fact as to which want of knowledge is asserted, is so plainly and necessarily within the
defendant s knowledge that his averment of ignorance must be palpably untrue. In the instant
case, it is difficult to believe that petitioners do not know how their payment was applied. Instead
of denying knowledge, petitioners could have easily asserted that their payments of
P110,301.80 and P20,000.00 were applied to, and should have been deducted from, the sum
sought to be recovered by respondent, but they did not, leading the court to no other conclusion
than that these payments were indeed applied to their other debts to respondent leaving an
outstanding obligation of P259,809.50.

On the basis of the foregoing, petitioners' defense of partial payment in their Answer to
Second Amended Complaint, in effect, no longer raised genuine issues of fact that require
presentation of evidence in a full-blown trial. Hence, the summary judgment of the RTC in
favor of respondent is proper.

17. SARMIENTO  - Solidbank Corp. v. Gateway Electronics, G.R. No. 164805, April 30,
2008
18. TENORIO - PIATCO v. Takenaka Corp, G.R. No. 180245, July 4, 2012
19. TORRES-Capitol Hills Golf and Country Club v. Sanchez, G.R. No. 182738, Feb. 24,
2014

G.R. No. 182738               February 24, 2014

CAPITOL HILLS GOLF & COUNTRY CLUB, INC. vs. SANCHEZ

TOPIC: INDIRECT CONTEMPT

Respondent Manuel O. Sanchez, a stockholder of petitioner Capitol Hills Golf & Country Club,
Inc. filed a petition for the nullification of the annual meeting of special meeting of stockholders.
Respondent filed a Motion for Production and Inspection of Documents, which the court granted
directing, thus:

On motion of the plaintiff, without objection from the defendants, and pursuant to Rule 3 of the
Interim Rules of Procedure Governing Intra-Corporate Controversies, in relation to Rule 27 of
the 1997 Rules of Civil Procedure, the defendants are ordered to produce and make available
for inspection and photocopying by the plaintiff the following documents:

1. The list of stockholders of record as of March 2002;

2. All proxies, whether validated or not, which have been received by the defendants;

3. The specimen signatures of all stockholders as contained in the Stock and Transfer
Book or on the stub of the stock certificate; and

4. The tape recording of the stockholders’ meeting on April 23, 2002 and May 21, 2002.

The production, inspection and photocopying must be undertaken in the office premises of
defendant corporation within reasonable business hours of a business day before the pre-trial
with costs to be shouldered by the plaintiff.

Respondent set the inspection to August 1, 2003. On said date, however, Atty. Matias V.
Defensor, then Corporate Secretary of the Corporation, was alleged to be out of town and
petitioner Pablo B. Roman, Jr. (Roman) purported to have shown no willingness to comply with
the directive. The matter was reported to the trial court, which merely noted respondent’s Report
and Manifestation. Respondent moved for the issuance of an order for immediate
implementation of the September 10, 2002 Order but the court denied the same in its Order.
Respondent’s motion for issuance of writ of execution suffered the same fate when the trial
court denied it.

During the January 11, 2007 inspection, the only document produced by the Acting Corporate
Secretary, Atty. Antonio V. Meriz, and one of the staff, Malou Santos, was the Stock and
Transfer Book of the Corporation. They alleged that they could not find from the corporate
records the copies of the proxies submitted by the stockholders, including the tape recordings
taken during the stockholders’ meetings, and that they needed more time to locate and find the
list of stockholders as of March 2002, which was in the bodega of the Corporation. This
prompted respondent to file a Manifestation with Omnibus Motion praying that an order be
issued in accordance with Section 3, Paragraphs (a) to (d) of Rule 29 of the Rules of Court
(Rules), in relation to Section 4, Rule 3 of the Interim Rules of Procedure Governing Intra-
Corporate Controversies under Republic Act No. 8799 (Interim Rules).

On September 3, 2007, the trial court issued a Resolution reiterating September 10, 2002 order.

This Court orders the defendants to strictly comply with this order. Failure of the defendants to
comply with all the requirements of the order dated September 10, 2002 will result in this court
citing all the defendants in contempt of court. This Court shall order defendants solidarily to pay
a fine of ₱10,000.00 for every day of delay to comply with the order of September 10, 2002 until
the defendants shall have fully and completely complied with the said order. Further sanctions
shall be meted upon defendants should the Court find that defendants have been in bad faith in
complying with the order of September 10, 2002 despite the order of this Court.

ISSUE WON proceedings for indirect contempt should be initiated

RULING

A person guilty of disobedience of or resistance to a lawful order of a court or commits any

improper conduct tending, directly or indirectly, to impede, obstruct, or degrade the
administration of justice may be punished for indirect contempt. In particular, Section 4, Rule 3
of the Interim Rules states that, in addition to a possible treatment of a party as non-suited or as
in default, the sanctions prescribed in the Rules for failure to avail of, or refusal to comply with,
the modes of discovery shall apply. Under Section 3, Rule 29 of the Rules, if a party or an
officer or managing agent of a party refuses to obey an order to produce any document or other
things for inspection, copying, or photographing or to permit it to be done, the court may make
such orders as are just. The enumeration of options given to the court under Section 3, Rule 29
of the Rules is not exclusive, as shown by the phrase "among others." Thus, in Republic v.
Sandiganbayan, We said:

To ensure that availment of the modes of discovery is otherwise untrammeled and efficacious,
the law imposes serious sanctions on the party who refuses to make discovery, such as
dismissing the action or proceeding or part thereof, or rendering judgment by default against the
disobedient party; contempt of court, or arrest of the party or agent of the party; payment of the
amount of reasonable expenses incurred in obtaining a court order to compel discovery; taking
the matters inquired into as established in accordance with the claim of the party seeking
discovery; refusal to allow the disobedient party support or oppose designated claims or
defenses; striking out pleadings or parts thereof; staying further proceedings.

In contempt proceedings, the respondent must be given the right to defend himself or
herself and have a day in court – a basic requirement of due process. This is especially
so in indirect contempt proceedings, as the court cannot decide them summarily
pursuant to the Rules of Court. As We have stated in Calimlim, in indirect contempt
proceedings, the respondent must be given the opportunity to comment on the charge
against him or her, and there must be a hearing, and the court must investigate the
charge and consider the respondent’s answer.

In this case, the proceedings for indirect contempt have not been initiated. To the Court’s
mind, the September 3, 2007 Resolution could be treated as a mere reiteration of the
September 10, 2002 Order. It is not yet a "judgment or final order of a court in a case of
indirect contempt" as contemplated under the Rules. The penalty mentioned therein only
serves as a reminder to caution petitioners of the consequence of possible non-
observance of the long-overdue order to produce and make available for inspection and
photocopying of the requested records/documents. In case of another failure or refusal
to comply with the directive, the court or respondent could formally initiate the indirect
contempt proceedings pursuant to the mandatory requirements of the Rules and existing
jurisprudence.

Even if We are to treat the September 3, 2007 Resolution as a "judgment or final order of
a court in a case of indirect contempt," this would still not work to petitioners’ advantage.
Section 11, Rule 71 of the Rules of Court lays down the proper remedy from a judgment
in indirect contempt proceedings. It states:
Sec. 11. Review of judgment or final order; bond for stay.––The judgment or final order of
a court in a case of indirect contempt may be appealed to the proper court as in criminal
cases. But execution of the judgment or final order shall not be suspended until a bond
is filed by the person adjudged in contempt, in an amount fixed by the court from which
the appeal is taken, conditioned that if the appeal be decided against him he will abide by
and perform the judgment or final order.

The recourse provided for in the above-mentioned provision is clear enough: the person
adjudged in indirect contempt must file an appeal under Rule 41 (Appeal from the
Regional Trial Courts) and post a bond for its suspension pendente lite. Obviously, these
were not done in this case. Instead, petitioners filed a petition for certiorari under Rule 65
of the Rules and did not post the required bond, effectively making the September 3,
2007 Resolution final and executory.