Lecture Notes Civil Procedure

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LECTURE NOTES ON CIVIL PROCEDURE

Revised October 2009 WHAT IS CIVIL PROCEDURE

1. It is the procedure governing the filing, processing and adjudication of civil actions. It essentially is the lawyer’s law that defines the rules of the game that lawyers and judges play.

2. It is considered as procedural law as it prescribes the method of enforcing rights and obtaining redress for their invasion, as opposed to substantive law which creates, defines, and regulates rights and duties that give rise to a cause of action.

2.1 The rules of procedure promulgated by authority of law bear the force and effect of law. 1

3. It is embraced in Rules 1 to 71 of the Rules of Court and after its revision, is now commonly known as the 1997 Rules of Civil Procedure. It is divided into the following topics: General Provisions (Rule 1), Ordinary Civil Actions (Rules 2-5), Procedure in Regional Trial Courts (Rules 6-39), Appeals (Rules 40-43), Procedure in the Court of Appeals and Supreme Court (Rule 44- 56), Provisional Remedies (Rules 57-61), and Special Civil Actions (Rules 62-71).

4. Included within its scope are the 1991 Rules on Summary Procedure, Local Government Code provisions on the Katarungang Pambarangay and related issuances of the Supreme Court.

PRELIMINARIES

1. Any discussion of procedural rules should always be preceded by a discussion of jurisdiction as its presence is what gives rise to the application of the rules for the purpose of resolving the action that is brought before a court. Simply defined it refers to the power and authority of a court or tribunal to hear, try and decide a case. It has also been defined as the authority by which courts and judicial officers take cognizance of and decide cases.

1.1 Absent jurisdiction, the only thing a court can do as provided by the rules is to dismiss the action.

Conlu v. Court of Appeals, 106 Phil 940

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1.2 If a court acts without jurisdiction, all its acts are null and void. Further, any decision it may render is not a decision in contemplation of law and cannot be executory. 2

1.3 The validity of a judgment or order of a court or quasi-judicial tribunal which has become final and executory may be attacked when the records show that it lacked jurisdiction to render the judgment-a void judgment may be assailed or impugned at any time either directly or collaterally by means of a petition filed in the same or separate case, or by resisting such judgment in any action or proceeding wherein it is invoked. In fact, even the testimony in a case where the proceedings had been nullified for lack of jurisdiction is inadmissible as evidence. 3

2. The absence of jurisdiction as a general rule may be questioned at any stage of the proceedings, even on appeal.

2.1 However, a party may be barred from raising it on the ground of laches or estoppel when he has actually invoked the jurisdiction of the court by participating in the proceedings, then belatedly questions lack of jurisdiction after judgment has gone against him. Participation in all stages before the trial court which included invoking its authority in asking for affirmative relief, effectively bars the party by estoppel from challenging the court’s jurisdiction. 4

2.2 The court actually does not have jurisdiction, but the law for reasons of equity, steps in to gag the negligent party and prevents him from raising its voice about lack of jurisdiction. It does so not because the Court has acquired jurisdiction but because of fault or negligence of a party now estops him from raising the question of lack of jurisdiction. 5

2.3 Note likewise the rules covering actions for annulment of judgment based on extrinsic fraud or lack of jurisdiction. If based on the latter, it can only be initiated before it is barred by laches or estoppel. 6

2.4 It is incumbent upon the petitioner to file a motion to dismiss at the earliest opportune time to raise the issue of the court’s lack of jurisdiction. Its failure to

Abbain vs. Chua, 22 SCRA 748, Estoesta vs. Court of Appeals, 179 SCRA 203, Dava vs. People, 202

2

SCRA 62

Dynamic Signmaker Outdoor Advertising Services, Inc. vs. Potongan, 461 SCRA 328

3

Heirs of the late Panfilo V. Pajarillo v. Court of Appeals, 537 SCRA 96

4

Tijam v. Sibonghanoy, 23 SCRA 29, Soliven v. FastForms, Phil. Inc., 440 SCRA 389

5

Sections, 2 and 3, Rule 49, 1997 Rules of Civil Procedure

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seasonably raise the question of jurisdiction leads to the inevitable conclusion that it is now barred by laches. 7

REQUISITES FOR A VALID EXERCISE OF JURISDICTION

1. It must have jurisdiction over the persons of the parties. It is acquired over the plaintiff upon his filing of a complaint.

1.1 On the other hand, it is acquired over the defendant by his voluntary appearance before the court or the employment of the coercive power of legal process.

2. It must also have jurisdiction over the subject matter in controversy. Jurisdiction over the subject matter of the complaint is to be determined by the allegations in the complaint and the law in force at the time of the commencement of the action. This is the power of a court to hear and determine cases of a general class to which the proceedings in question belong. 8

2.1 Determined by allegations in the complaint. Jurisdiction must be determined at the commencement of the action. Since an action is commenced by the filing of a complaint, it is also the means by which the plaintiff invokes the jurisdiction of the court. Hence, it is from it that a determination of the existence of jurisdiction is had.

2.2 The determination is to be confined solely to the four corners of the complaint. Specifically, what characterizes an action is not the caption of the pleading, which is just a legal conclusion on the part of the pleader, but the allegations in the body of the complaint. 9

2.3 In case of conflict between the allegations and the reliefs, the allegations in the body shall prevail. The prayer is a conclusion of the pleader as to the proper reliefs that he would be entitled to on the basis of the pleaded cause of action. The Court is not bound as it may grant a relief, lesser or greater in amount, or totally different from that prayed for. 10

2.4 Even if the plaintiff alleges an amount that puts the case within the jurisdiction of the RTC, the court’s jurisdiction is not affected if it later finds that

United Overseas Bank v. Ros, 529 SCRA 334

7

Heirs of Valeriano S. Concha, Sr. v. Lumocso, 540 SCRA 1

8

De Jesus v. Bristol Laboratories, 55 SCRA 349, Solid Homes v. Court of Appeals, 271 SCRA 157

9

Bulao v. Court of Appeals, 218 SCRA 321

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the plaintiff is entitled to an amount within the jurisdiction of an MTC. 11

Conversely, if a court has no jurisdiction, the defect will not be cured by a finding during the trial that the amount actually due is within the jurisdiction of the court. 12

2.5 Neither can it be determined from the allegations in the answer of the defendant. If the rule were otherwise, no action can prosper as all the defendant has to do is to allege that the jurisdiction is vested in another court.

2.6 The only recognized exception is the defense of agricultural tenancy. 13

The court in this case must conduct a preliminary hearing on the defense to determine if there is indeed a tenancy relationship, as its existence shall mean that the court has no jurisdiction as the same is vested exclusively with the DARAB. 14

2.7 Determined by the law in force at the time of the commencement of the action. Jurisdiction as used in the Constitution and statutes means jurisdiction over the subject matter unless qualified to mean another kind of jurisdiction. 15

This jurisdiction refers to the jurisdiction of a court over a general class of cases or the power to try and decide the class of litigation to which the particular case belongs. Jurisdiction is conferred by law, where there is none, no agreement of 16

the parties can provide one. 17

2.8 Example: If an action for payment of a sum of money is filed after the effectivity of RA 7961 on April 15, 1994, expanding the jurisdiction of the MTC and implemented by Adm. Circular 9-94 interest, damages of whatever kind- 18

as long as incidental, attorney’s fees, litigation expenses and costs (DIAL-C) are not to be considered in fixing the jurisdictional amount, but must be specifically alleged and filing fees paid thereon. Hence, in an action for the payment of a sum of money previous to the said date, a determination of jurisdiction would have to include the amounts claimed by way of DIAL-C. Another is Section 5.2, RA

Ratilla v. Tapucar, 75 SCRA 64

11

Mercado v. Ubay, 187 SCRA 719

12

Section 3, Rule 70, 1997 Rules of Civil Procedure

13

Concepcion v. CFI of Bulacan, 119 SCRA 222

14

Reyes v. Diaz, 73 Phil 484

15

Caluag v. Pecson, 82 Phil 8

16

Department of Health v. NLRC, 251 SCRA 700

17

June 14, 1994

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8799 that vests jurisdiction over intra-corporate disputes in the RTC that sits as 19

a commercial court.

2.9 When a court has already obtained and is exercising jurisdiction over a controversy, its jurisdiction to proceed to the final determination of the cause is not affected by new legislation placing jurisdiction over such proceedings in another tribunal unless the statute expressly provides, or is construed to the effect that it is intended to operate on actions pending before its enactment. 20

3. Jurisdiction over the res assumes importance only in those actions where the court cannot acquire jurisdiction over the person of the defendant because he is not a resident and cannot be found here or served with summons.

3.1 These are quasi in rem actions. The action is directed against a 21

defendant personally, although its object is to subject his interest in the property to the obligation or the lien. 22

PROBLEM AREAS AFFECTING JURISDICTION

1. Actions which are incapable of pecuniary estimation

1.1 Generally, it is one where the basic issue is something other than the right to recover money, where the money claim is incidental to or is a consequence of the principal relief being sought.

1.2 It is a claim, the subject of which cannot be estimated in terms of money. 1.3 Examples: Action for specific performance – although damages are being sought but if damages are part of an alternative prayer, jurisdiction should be based on the amount. Other examples: Action for appointment of receivers, expropriation, interpleader, support, and rescission.

1.4 In determining which court has jurisdiction, the applicable test is the Nature of the Action Test which involves a determination as to whether or not the action is capable of pecuniary estimation. If not capable, jurisdiction is with the RTC. If capable-jurisdiction is determined by the amount claimed/value of the real or personal property but this test must yield to the Primary or Ultimate Objective

Securities Regulation Code of 2000

19

Palana v. People, 534 SCRA 296

20

Perkins v. Dizon, 69 Phil 186

21

Biaco v. PCRB, 515 SCRA 106

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Test where notwithstanding the fact that the action appears to be incapable of pecuniary estimation, if the primary objective is to recover real property, jurisdiction will be determined by the assessed value of the real property.

1.5 Examples: An action for specific performance with a prayer for the issuance of a deed of sale over a parcel of land is a real action as the object is the recovery of the land itself or an action to quiet title in which both parties are 23

claiming ownership of the subject parcels of land is also a real action. Hence, 24

they cannot be considered as being incapable of pecuniary estimation.

2. DETERMINATION OF AMOUNTS OF THE CLAIM TO DETERMINE

JURISDICTION AND PAYMENT OF DOCKET FEES.

2.1 Filing and docketing of the complaint are not separate but are complementary. It is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee that vests a trial court with jurisdiction over the subject matter or nature of the action. 25

2.2 The problem arises as filing is not synonymous with docketing as the complaint may be filed but not necessarily docketed if the appropriate fees are not paid.

2.3 The purpose of docket fees is to take care of court expenses in the handling of cases in terms of costs of supplies, use of equipment, salaries and benefits. 26

2.4 Examples in determining appropriate docket fees: (a) F o r e c l o s u r e o f chattel to collect PHP 100,000.00 but actual value of chattel is PHP 500,000.00, the docket fee is based on what is sought to be collected and jurisdiction is determined by the amount claimed by the plaintiff (b) An action to collect a sum of money that is within jurisdiction of the MTC but with accessory prayer for damages beyond MTC jurisdiction, the damages, interest, attorneys’ fees, litigationg expenses are to be excluded in determining jurisdiction but docket

Gochan v. Gochan, 372 SCRA 256

23

Ferrer v. Lucas, CA G.R. No. SP 52294, July 9, 1999

24

Proton Pilipinas Corporation v. Banque Nationale de Paris, 460 SCRA 260.

25

Serrano v. Delica, 465 SCRA 82

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fees are still to be collected but if action is for damages over 400K jurisdiction is 27

with the RTC because it is the main cause of action or one of the causes of action.

2.5 If the docket fees are incorrect- the trial court should allow the plaintiff to pay within a reasonable period of time before the expiration of the applicable prescriptive or reglamentary period otherwise the defendant must move to dismiss the complaint on the ground of lack of jurisdiction, if he does not, he may be considered to be in estoppel. 28

2.6 The court had jurisdiction over the amended complaint as it had acquired jurisdiction over the case when the original complaint was filed and the corresponding docket fee was paid thereon. While the payment of the prescribed docket fee is a jurisdictional requirement, even its nonpayment at the time of filing does not automatically cause the dismissal of the case, as long as the fee is paid within the applicable prescriptive or reglementary period. 29

2.7 When the docket fees for the main action are paid but those for related damages alleged but not specified are not paid, the court is not prevented from proceeding with the complaint, the trial court may expunge the claims or allow on motion, a reasonable time for amendment of the complaint or accept payment of the requisite legal fees. 30

2.8 In a complaint for recovery of possession of real property which did not allege the assessed value thereof, the trial court commits a serious error in denying a motion to dismiss on the ground of lack of jurisdiction. All proceedings in said court are null and void. 31

2.9 If the claims are not specified and subsequently arise or there is an insufficiency in the payment of docket fees, the required additional fee shall constitute a lien on the judgment and the clerk of court must enforce and collect the difference in docket fees from the judgment that may be rendered by the court in the case, awarding a claim no specified in the pleading or if specified is left to its determination. 32

A.M. 09-94, June 14, 1994

27

NSC v. Court of Appeals, G.R. 123215, February 2, 1999

28

Pagcor v. Lopez, 474 SCRA 76, Polido v. Court of Appeals, 527 SCRA 248

29

Tacay v RTC of Tagum, Davao del Sur, 180 SCRA 433

30

Quinagoran vs. CA, GR No. 155179, August 24, 2007

31

Pascual v. Court of Appeals, 300 SCRAPascual v. Court of Appeals, 300 SCRA 214

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DISTINCTIONS BETWEEN THE NATURE OF JURISDICTION EXERCISED BY THE COURTS

1. AS TO THE NATURE OF THE EXERCISE OF JURISDICTION OR KIND

OF CASES THAT ARE TRIED – it is General, meaning it is exercised over all kinds of cases or Limited, meaning it exercised over and extends only to a particular or specified cases

2. AS TO THE NATURE OF THE CAUSE OR THE ACTION – it is Criminal

when the object of the action is to impose punishment for a crime or Civil, if otherwise.

3. AS TO THE TIMING OF ITS EXERCISE- it is Original, meaning it is exercised by courts in the first instance or Appellate, meaning it is exercised by a superior court to review and decide a cause or action previously decided by a lower court.

4. AS TO THE EXTENT OF THE EXERCISE OF JURISIDICTION – it is Exclusive, meaning it is confined to a particular court or Concurrent, meaning two or more courts have jurisdiction at the same time and place.

4.1 In this instance, the court which has first validly acquired jurisdiction takes it to the exclusion of the others. This is also known as the Exclusionary Principle. This is taken together with the Doctrine of Judicial Stability of Non-Interference which holds that court of co-equal or coordinate jurisdiction shall have no authority to pass upon or scrutinize the exercise by another court of its jurisdiction.

4.2 Note though the Doctrine of Hierarchy of Courts which requires litigants to initially seek proper relief from the lower courts in those cases where the Supreme Court has concurrent jurisdiction with the Court of Appeals and the Regional Trial Court to issue the extraordinary writs of certiorari, prohibition or mandamus. The Supreme Court is a court of last resort and its jurisdiction to issue extra-ordinary writs should be exercised only when absolutely necessary, or where serious and important reasons therefor exist. Neither does 33

concurrence of jurisdiction grant any party seeking any of the extra-ordinary writs the absolute freedom to file the petition with the court of his choice. 34

Pearson v. IAC, 295 SCRA 27

33

Ouano vs. PGTT International Investment Corporation, 384 SCRA 587

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5. AS TO SITUS – it is Territorial, meaning it is exercised within the limits of the place where the court is located or Extra-Territorial meaning it is exercised beyond the confines of the territory where the court is located.

WHAT HAPPENS WHEN JURISDICTION IS ACQUIRED

Jurisdiction once acquired continues until the case is terminated. It is not affected by subsequent legislation placing jurisdiction in another tribunal. The 35

exceptions are: when the law expressly provides for retroactivity, when the 36

change in jurisdiction is curative in nature, or when there is a perfected appeal. This is also known as the Doctrine of Adherence to Jurisdiction.

DOCTRINE OF PRIMARY JURISDICTION

1. That which vests in an administrative tribunal the jurisdiction to determine a controversy requiring the exercise of sound administrative discretion – stated otherwise – if jurisdiction is vested upon an administrative body, no resort to courts can be made until the administrative body shall have acted on the matter. 2. In exercising its primary jurisdiction, a court has the inherent jurisdiction to determine issues incidental to its exercise. This is known as the Doctrine of Ancillary Jurisdiction.

LEVELS OF SUBJECT MATTER JURISDICTION

1. JURISDICTION OF THE SUPREME COURT

The jurisdiction of the Supreme Court in civil cases of which it cannot be deprived and which cannot be diminished by Congress is to review, revise, reverse, modify, or affirm on appeal or certiorari as the law or the Rules of Court may provide, final judgments and orders of lower courts in: (a) all cases in which the constitutionality or validity of any treaty, international or executive agreement, law, presidential decree, proclamation, order, instruction, ordinance, or regulation is in question; (b) all cases involving the legality of any tax, impost, assessment, or toll, or any penalty imposed in relation thereto; (c) all cases in which the jurisdiction of any lower court is in issue; and (d) all cases in which only an error or question of law is involved.

Mercado v. Ubay, 187 SCRA 719

35

Latchme Motoomull v. Dela Paz, 187 SCRA 743

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The foregoing Constitutional definition is of appellate jurisdiction. Congress, however, is not prohibited from increasing or adding to this Constitutionally-defined jurisdiction. And so Congress has given the Supreme Court original jurisdiction over cases affecting ambassadors, other public ministers, and consuls and petitions for the issuance of writs of certiorari, prohibition and mandamus against the Court of Appeals. Congress has also vested the Supreme Court with jurisdiction, concurrent with the RTCs, over petitions for the issuance of the writs of certiorari, prohibition, habeas corpus, and in actions brought to prevent and restrain violations of law concerning monopolies and combinations in restraint of trade.

The appellate jurisdiction in civil cases of the Supreme Court as defined in the Constitution had been revised and expanded a little bit more by law to include all cases involving petitions for naturalization or denaturalization, all decisions of the Auditor General, if the appellant is a private person or entity, and final judgments or orders of the Commission on Elections.

2. JURISDICTION OF THE COURT OF APPEALS

The Court of Appeals has both original and appellate jurisdiction. Its original jurisdiction, which is exclusive, is over actions for annulment of RTC judgments. Its original jurisdiction, which is concurrent with the Supreme Court and the RTCs, is to issue writs of mandamus, prohibition, certiorari, habeas corpus and quo warranto, and auxiliary writs or processes, whether or not in aid of its appellate jurisdiction.

The appellate jurisdiction of the Court of Appeals, which is exclusive, is over final judgments or resolutions of RTCs and quasi-judicial agencies, such as the Securities and Exchange Commission, Sandiganbayan and the National Labor Relations Commission.

3. JURISDICTION OF REGIONAL TRIAL COURTS

The RTCs are our second-level trial courts. As the Supreme Court and the Court of Appeals, RTCs have both original and appellate jurisdiction in civil cases.

Their original jurisdiction is concurrent with the Supreme Court and the Court of Appeals in the issuance of writs of certiorari, prohibition, mandamus, quo warranto, habeas corpus and injunctions but, as issued by RTCs, these writs may be enforced only within their respective regions, and over actions affecting ambassadors and other public ministers and consuls. The original jurisdiction of RTCs, which is exclusive, is broad and covers the following cases: (1) all civil actions in which the subject of the litigation is incapable of pecuniary estimation; (2) all civil actions which involve the title to, or possession of, real property, or any interest therein, where the assessed value of the property involved exceeds Two

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hundred thousand pesos (P200,000.00) or for civil actions in Metro Manila, where such value exceeds Four hundred thousand pesos (P400,000.00) except actions for forcible entry into and unlawful detainer of lands or buildings, original jurisdiction over which is conferred upon the Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts; (3) all actions in admiralty and maritime jurisdiction where the demand or claim exceeds Two hundred thousand pesos (P200,000.00) or in Metro Manila, where such demand or claim exceeds Four hundred thousand pesos (P400,000.00); (4) all matters of probate, both testate and intestate, where the gross value of the estate exceeds Two hundred thousand pesos (P200,000.00) or, in probate, both testate and intestate, where the gross value of the estate exceeds Two hundred thousand pesos (P200,000.00) or, in probate matters in Metro Manila, where such gross value exceeds Four hundred thousand pesos (P400,000.00); (5) all actions involving the contact of marriage and marital relations; (6) all cases not within the exclusive jurisdiction of any court, tribunal, person or body exercising jurisdiction of any court, tribunal, person or body exercising judicial or quasi-judicial functions; (7) all civil actions and special proceedings falling within the exclusive jurisdiction of a Juvenile and Domestic Relations Court and of the Court of Agrarian Relations as then provided by law; and (8) all other cases in which the demand, exclusive of interest, damages of whatever kind, attorney’s fees, litigation expenses, and costs or the value of the property in controversy exceeds Two hundred thousand pesos (P200,000.00) or, in such other cases in Metro Manila, where the demand, exclusive of the above-mentioned items exceeds For hundred thousand pesos (P400,000.00).

The appellate jurisdiction of the RTCs is over all cases decided by Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial Courts in their respective territorial jurisdiction.

The term “damages of whatever kind” has been specially defined by the Supreme Court for purposes of determining the jurisdictional amount in respect to the jurisdiction of the RTC. This term is understood to apply only to cases when the damages are merely incidental to or a consequence of the main cause of action, and that therefore where the claim for damages is the main cause of action or one of the causes of action, the amount of the claim shall be considered in determining the jurisdiction of the court.

The Supreme Court has however designated certain branches of the RTCs to handle exclusively certain cases as corporate and intellectual property cases.

4. JURISDICTION OF METROPOLITAN TRIAL COURTS, MUNICIPAL

TRIAL COURTS AND MUNICIPAL CIRCUIT TRIAL COURTS

The MTCs are the first-level trial courts in this country. They have therefore no appellate jurisdiction and all their jurisdiction is exclusive and

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encompasses the following cases: (1) all civil actions and probate proceedings, testate and intestate, including the grant of provisional remedies in proper cases, where the value of the personal property, estate, or amount of the demand does not exceed two hundred thousand pesos (P200,000.00) or, in Metro Manila where such personal property, estate, or amount of the demand does not exceed Four hundred thousand pesos (P400,000.00), exclusive of interest, damages of whatever kind, attorney’s fees, litigation expenses, and costs, the amount of which must be specifically alleged: Provided, That where there are several claims or causes of actions between the same or different parties, embodied in the same complaint, the amount of the demand shall be the totality of the claims in all the causes of action irrespective of whether the causes of action arose out of the same or different transactions; (2) cases of forcible entry and unlawful detainer: Provided, That when, in such cases, the defendant raises the question of ownership in his pleadings and the question of possession cannot be resolved without deciding the issue of ownership, the issue of ownership shall be resolved only to determine the issue of possession; and (3) all civil actions which involve title to, or possession of, real property or any interest therein where the assessed value of the property or interest therein does not exceed Two hundred thousand pesos (P200,000.00) or, in civil actions in Metro Manila, where such assessed value does not exceed Four hundred thousand pesos (P400,000.00) exclusive of interest, damages of whatever kind, attorney’s fees, litigation expenses and costs.

The MTCs may however be assigned by the Supreme Court to hear and determine certain cadastral cases and petitions for habeas corpus.

RULE I GENERAL PROVISIONS

1. The Rules shall be known and cited as the Rules of Court. 37

2. They apply in all courts, except as otherwise provided by the Supreme Court in civil, criminal and special proceedings. 38 39

2.1 For purposes of the subject matter, only Rules 1 to 71 or the 1997 Rules of Civil Procedure shall be discussed herein.

Section 1, Rule 1, 1997 Rules of Civil Procedure

37

Supra, Section 2, Rule 1

38

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2.2 A Civil Action is one by which a party sues another for the enforcement or protection of a right or the prevention or redress of a wrong. Examples: To enforce payment of a loan or to eject an intruder on one’s property.

2.3 Civil Actions may be considered as:

(a) Ordinary or Special, while both are governed by the rules for ordinary civil actions, there are specific rules prescribed for a special civil action.

(b) In Personam, which is an action brought against a person based on personal liability to the person bringing the action. The purpose of the action is to impose through the judgment of a court, some responsibility or liability directly upon the person of the defendant. In this kind of action, no one other than the 40

defendant is held liable, not the whole world.

(c) In Rem, is an action that is directed against the thing itself rather than the person, It is directed against the thing, property or status of a person and seeks judgments with respect thereto against the whole world. An example would be 41

an action for registration of land as the judgment thereon is binding upon the whole world.

(d) Quasi in Rem, is an action that names a person as a defendant but its object is to subject the person’s interest in property to a corresponding lien or obligation. It deals with the status, ownership or liability of a particular property 42

but which are intended to operate on these questions only as between the particular parties to the proceedings and do not cut off the rights and interests of all possible claimants. Examples are actions for partition, attachment or foreclosure of mortgages.

2.4 Note the distinctions between actions in personam, on one hand, and actions in rem or quasi in rem on the other, is essential as far as jurisdiction. In an action in personam, jurisdiction over the person of the defendant is necessary for the court to validly try and decide the case. In a proceeding in rem or quasi in rem, jurisdiction over the person of the defendant is not a prerequisite to confer jurisdiction on the court provided that the court acquires jurisdiction over the res. Jurisdiction over the res is acquired either (1) by the seizure of the property under legal process, whereby it is brought into actual custody of the law; or (2) as a result of the institution of legal proceedings, in which the power of the court is recognized and made effective. 43

Domagas v. Jensen, 448 SCRA 663

40

Ching v Court of Appeals, 181 SCRA 9

41

Ramos v. Ramos, 399 SCRA 43

42

Biaco v. Philippine Countryside Rural Bank, GR No. 161417, February 8, 2007

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3. Civil Actions can also be distinguished as:

3.1 Real Actions are those which affect title to, or possession of real property or any interest therein. All others are personal actions. 44 45

3.2 In a real action, it is founded upon the privity of real estate. That means that realty or any interest therein is the subject matter of the action. What is essential is that as far as the real property is concerned, the issues are title to, ownership, possession, partition, foreclosure of mortgage or condemnation. Hence, an action for damages suffered by real property is a personal action as it does not involve any of the listed issues.

3.3 An action to annul a contract of loan and its accessory real estate mortgage is a personal action. In a personal action, the plaintiff seeks recovery of personal property, the enforcement of a contract or recovery of damages. A real action is an action affecting title to real property or for recovery of possession, or for partition or condemnation of, or foreclosure of mortgage on real property. The rule on real actions only mentions an action for foreclosure of real estate mortgage; it does not include an action for cancellation or annulment of a real estate mortgage. 46

3.4 The distinction between a real action and a personal action is important for the purpose of determining the venue of the action.

3.5 An action in personam is not necessarily a personal action. Nor is a real action necessarily an action in rem. An in personam or an in rem action is a classification of actions according to the object of the action. A personal and real action is a classification according to foundation. It is in rem when directed against the whole world. For instance, an action to recover, title or possession of real property is a real action, but it is an action in personam. It is not brought against the whole world but against the person upon whom the claim is made. 47

4. Distinguishing civil actions from other kinds of actions:

4.1 Criminal Action is one by which the state prosecutes a person for an act or omission punishable by law.

4.2 A Special Proceeding is a remedy by which a party seeks to establish a status, right or a particular fact. In addition, a civil action is adversarial, while a special proceeding may not be so as it may involve only 1 party. The object of a

44

45

Chua vs. Total Office Products and Services, Inc., 471 SCRA 500

46

Republic v Court of Appeals, 315 SCRA 600

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civil action is the formal demand of a right by one against the other, while in a special proceeding, it is the declaration of a status, right or a particular fact.

5. They do not apply to election cases, land registration, cadastral, naturalization and insolvency, and other cases not herein provided, except by analogy or in suppletory character and whenever practicable and convenient. 48

6. The rules have retroactive application in the sense that they shall be held to apply to actions pending or undetermined at the time of their effectuality. 49

6.1 The exceptions to retroactive application are: (a) the statute itself or by implication provides that pending actions are excepted (b) it will impair vested rights (c) to the mind of the court, it will work injustice (d) it would involve intricate problems of due process or impair the court’s independence

WHEN AN ACTION IS COMMENCED

1. An action is commenced upon the filing of the original complaint in court. Filing refers to the act of presenting the complaint to the clerk of court and the payment of the requisite docket and filing fees. Filing is deemed done only upon payment regardless of the actual date of the filing. 50

1.1 An exception is when the plaintiff is authorized to litigate as a pauper litigant as he is exempt from the payment of filing fees.

2. If an additional defendant is impleaded in a later pleading, it is commenced as far as the additional defendant on the date of the filing of the later pleading, irrespective of whether the motion for its admission, if necessary is denied by the court. 51

3. Note that the commencement of the action interrupts the period of prescription as to the parties to the action. 52

HOW SHOULD THE RULES BE CONSTRUED

Supra,,Section 4, Rule 1

48

Nypes v. Court of Appeals, 478 SCRA 115

49

Magaspi v. Ramolete, 115 SCRA 193

50

51

Cabrera v Tiano,8 SCRA 542

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1. The rules shall be construed liberally in order to promote their objective of securing a just speedy and inexpensive disposition of every action or proceeding. 53

1.1 Liberal construction is the controlling principle to effect substantial justice. Litigation should as much as possible, be decided on their merits, and not on technicalities.

1.2 Rules must not be applied to rigidly so as not to override substantial justice. Rules of procedure must be used to facilitate not to frustrate the ends 54

of justice. 55

1.3 It does not mean, however, that procedural rules are to be ignored or disdained at will to suit the convenience of a party. 56

2. Liberal construction of the rules should be made by the courts in cases: (a) a rigid application will result in manifest failure or miscarriage of justice, especially if a party successfully shows that the alleged defect in the questioned final and executory judgment is not apparent on its face or from the recitals contained therein (b) where the interest of substantial justice will be served (c) where the resolution of the motion is addressed solely to the sound and judicious discretion of the court (d) where justice to the adverse party is not commensurate with the degree of this thoughtlessness in not complying with the procedure prescribed.57

3. A party litigant should be given the fullest opportunity to establish the merits of his complaint or his defense. He ought not to lose life, liberty or honor or property on technicalities.

3.1 Rules of procedure should be viewed as mere tools designed to facilitate the attainment of justice. An example is the matter of the attachment of copies to petitions or failure to indicate material dates in the petition. 58 59

Supra,Section 6, Rule 1

53

De La Cruz v. Court of Appeals, GR No. 139442, December 6, 2006

54

Canton v City of Cebu, GR No. 152898, February 12, 2007

55

Vda De Toledo v Toleda, 417 SCRA 260

56

Seapower Shipping Enterprises, Inc. v CA, 360 SCRA 173, Tan v CA, 295 SCRA 755

57

Alberto v Court of Appeals, 334 SCRA 756

58

Fulgencio v NLRC, 411 SCRA 69

(17)

4. Note that in doing so, substantial justice and equity considerations must not be sacrificed.

4.1 Periods for filing are as a matter of practice, strictly construed.

4.2 Neither can liberality of the rules be invoked if it will result in the wanton disregard of the rules or cause needless delay in the administration of justice. 60

5. Concommitant to a liberal application of the rules of procedure should be an effort on the part of the party invoking liberality to adequately explain his failure to abide by the rules. 61

6. The rules and procedure laid down for the trial court and the adjudication of cases are matters of public policy.

6.1 They are matters of public order or interest which can in no wise be changed or regulated by agreements between or stipulations by parties to an action for their singular convenience. 62

6.2 They are required to be followed except only for the most persuasive of reasons as when transcendental matters of life, liberty or state security is involved. Litigation is not a game of technicalities. It is equally true, however, that every case must be presented in accordance with the prescribed procedure to ensure an orderly and speedy administration of justice. 63

7. The Supreme Court has the power to suspend or set aside its rules in the higher interest of justice. Specifically, the reasons that will warrant the 64

suspension are: (a) the existence of special or compelling reasons (b) the merits of the case (c) a cause not entirely attributable to the fault or negligence of the party favored by the suspension (d) a lack of showing that the review is frivolous or dilatory, and (e) the other party will not be prejudiced thereby. 65

RULE 2 CAUSE OF ACTION

CAUSE OF ACTION DEFINED

El Reyno Homes v Ong, 397 SCRA 563

60

Sebastian v Hon. Morales, 397 SCRA 549, Duremdes v Duremdes, 415 SCRA 684

61

Republic v Hernandez, 253 SCRA 509

62

Mindanao Savings Loan Association v. De Flores, 469 SCRA 416

63

Fortica v Corona, GR No. 131457, April 24, 1998

64

Sarmiento v. Zaratan, GR No. 167471, February 5, 2007

(18)

1. The basis of an ordinary civil action is a cause of action. 66

2. A cause of action is the act or omission by which a party violates a right of another. 67

THE REQUISITES OF A CAUSE OF ACTION

1. The requisites for a cause of action are: (a) a right in favor of the plaintiff by whatever means and under whatever law it arises or is created (b) an obligation on the part of the defendant to respect and not to violate such right (c) an act or omission on the part of the defendant constituting a violation of the plaintiff’s right. 68

DISTINGUISHING IT FROM AN ACTION AND A RIGHT OF ACTION

1. An action is the suit filed in court for the enforcement or protection of a right, or the prevention or redress of a wrong, while a cause of action is the basis for the filing of the action.

2. The right of action is the right to commence and maintain an action, it is a remedial right that depends on substantive law, while a cause of action is a formal statement of the operative facts that give rise to such remedial right which is a matter of statement and is governed by procedural law. The right of action which is procedural in character is the consequence of the violation of the right of the plaintiff. Hence, there is no right of action where there is no cause of action.

2.1 The distinction is best used to explain the principle that the existence of a cause of action may only be ascertained from the allegations of the complaint. 69

HOW MANY SUITS CAN BE FILED FOR A CAUSE OF ACTION

Same Objective Test – if a party has only one objective in filing two cases, there exists identity of causes of action and reliefs based on the same objective standard. 70

66

Supra, Section 2, Rule 2, PNOC v. Court of Appeals, GR No. 165433, February 6, 2007

67

Navao v CA, 251 SCRA 545

68

Equitable Bank v CA, 425 SCRA 544

69

Clark Development Corporation v Mondragon Leisure Resorts, 517 SCRA 203

(19)

1. A party may not institute more than one suit for a single cause of action. 71

2. The practice of splitting a cause of action is discouraged because it breeds multiplicity of actions, clogs the dockets of the courts and operates to cause unnecessary expense to the parties.

3. If a party institutes more than one suit, the filing of one or a judgment upon the merits in anyone is available as a ground for the dismissal of the others. 72

This is also known as Splitting a Cause of Action.

3.1 The remedy of the defendant is to file a motion to dismiss. If the action is pending when the second action is filed, the dismissal is based on litis pendentia or if a final judgment has been rendered in the first action when the second is filed, the dismissal is based on res judicata.

3.2 Note though that the rule does not confine itself to a dismissal of the second action. As to which action is to be dismissed would depend on judicial discretion and attendant circumstances.

4. The rule on splitting a cause of action applies not only to complaints but also to counter-claims and cross-claims. 73

5. The singleness of a cause of action is determined as follows:

5.1 In an action Ex Delicto or one arising from the fault or negligence of a defendant, the singleness of a cause of action lies in the singleness of the delict or wrong violating the right of a person. If however, one injury results from several wrongful acts, only one cause of action arises. Example: A party who is injured could not maintain an action for damages based on a breach of the contract of carriage against the owner of the vehicle in which he was riding and another action for quasi-delict against the driver/owner of the offending vehicle. The recovery under one remedy necessarily should bar recovery under another. This, in essence, is the rationale for the proscription in our law againt double recovery for the same act or omission which, obviously stems from the fundamental rule against unjust enrichment. 74

71

72

Mariscal v. Court of Appeals, 311 SCRA 51

73

Joseph v Bautista, 170 SCRA 540

(20)

5.2 In an action Ex Contractu or one arising out of or is founded on a contract, the rules are as follows:

(a) In a single or indivisible contract, only one cause of action arises from a single or several breaches. Example: In a contract of sale of personal property by installments, the remedies of the unpaid seller is alternative, they are: (1) elect fulfillment (2) cancel the sale, should the vendee’s failure to pay cover two or more installments, and (3) foreclose the mortgage on the thing sold if one has been constituted should the vendee fail to pay two or more installments. 75

(b) If the contract provides for several obligations, each obligation not performed gives rise to a single cause of action. But if upon filing of the complaint several obligations have already matured, all of them shall be integrated into a single cause of action. Example: Contract for delivery of goods in part or over a period.

(c) If the contract is divisible in its performance, and the future performance is not yet due, but the obligor has already manifested his refusal to comply, the contract is entire and the breach is total. Thus, there can only be one action. 76

This is known as the Doctrine of Anticipatory Breach. IF A PARTY HAS SEVERAL CAUSES OF ACTION

1. He can join his causes of action as he may in one pleading assert, in the 77

alternative or otherwise, as many causes of action as he may have against the opposing party. It is the assertion of as many causes of action as a party may have against another in one pleading alone.

2. It has also been defined as the process of uniting two or more demands or rights of action in one action. 78

3. Joinder is subject to the following conditions:

3.1 Party joining the causes of action shall comply with the rule on joinder of parties, which provides that : All persons in whom or against whom any right to relief is respect to or arising out of the same transaction is alleged to exist, whether jointly, severally or in the alternative, may except as otherwise provided in these rules, join as plaintiffs or be joined as defendants in one complaint, where any question of law or fact common to all such plaintiffs or to all such

Articles 1484,1486, NCC

75

Blossom & Co v Manila Gas Corporation, 55 Phil 226

76

77

1 C.J.S., Actions 61

(21)

defendants may arise in the action. Note that the common question of law or 79

fact is relevant only when there are multiple plaintiffs or defendants.

3.2 Joinder does not allow the inclusion of special civil actions or actions governed by special rules . Example: An action for a sum of money cannot be joined with an action for iIlegal detainer

3.3 Where causes of action are between same parties but pertain to different venues or jurisdictions, joinder may be allowed in the RTC provided one of the causes of action falls within its jurisdiction and venue lies therein.

3.4 When the claims in all causes of action are principally for recovery of money, the aggregate amount shall be the test of jurisdiction.

EFFECT OF MISJOINDER

1. Upon motion of a party or on the initiative of the court, a misjoined cause of action may be severed and proceeded with separately. 80

2. Misjoinder is not ground for a motion to dismiss.

RULE 3 PARTIES TO CIVIL ACTIONS

WHO MAY BE PARTIES TO A CIVIL ACTION

1. Only natural or juridical persons or entitles authorized by law may be parties in a civil action. They are called: Plaintiff – he is one who has interest in 81

the subject of the action and obtaining the relied demanded. He may be the claimant in the original complaint, the counter-claimant in the counter claim, or cross-claimant in a cross-claim or the third party plaintiff and the Defendant – he is one who has an interest in the controversy adverse to the plaintiff. He may be the original defending party, the defendant in a counter-claim, or cross-defendant in a cross-claim.

1.1 For ready reference, a counter-claim is any claim which a defending party may have against an opposing party. A cross-claim is a claim by one party 82

against a co-party arising out of the transaction or occurrence that is the subject

79

80

Supra,,Section 1, Rule 3

81

(22)

matter either of the original action or of a counter-claim therein. A third party 83

claim is a claim that a defending party may, with leave of court, file against a person not party to an action for contribution, indemnity, subrogation or any other relief, in respect to his opponent’s claim. 84

2. Juridical persons include:

2.1 The state or any of its political subdivisions, while considered as juridical entities, they can sue but as a general rule, they cannot be sued without its consent. It is deemed to have given consent when: (a) it enters into a private contract (b) it enters into a business operation unless it is an incident of its primary government function (c) it sues a private party, unless the suit is to resist a claim (d) when there is a failure to abide with what the law or contract provides. A suit is considered as against the state when: (a) it is against the Republic of the Philippines (b) it is against a government agency or office without juridical personality (c) it is against the officers or agents of the government and involves a financial liability.

2.2 Corporations, institutions and entities for public interest or purpose, created by law, like government agencies and water districts.

2.3 Corporations, partnerships, and associations for private interest or purpose to which the law grants juridical personality, separate and distinct from that of a shareholder, partner or member.

2.4 A partnership having capital of P 3,000.00 that fails to comply with registration requirements. 85

2.5 A dissolved corporation within a 3 year period after dissolution to settle its affairs. 86

2.6 A foreign corporation cannot be a plaintiff in suit when it is transacting business in the Philippines without a license.

3. Entities authorized by law are (a) recognized labor organizations (b) estate of a deceased person (c) Roman Catholic Church 87 88

83

84

Article 1772 in relation to Article 1768, NCC

85

Section 122, BP 68

86

Nazareno v. Court of Appeals, 343 SCRA 637

87

Versoza v. Fernandez, 49 Phil 627

(23)

4. Entities without legal personality referring to 2 or more persons not organized as an entity with juridical personality enter into a transaction, they may be sued under the name by which they are generally or commonly known but in their answer to the complaint, their names and addresses must be revealed. 89

4.1 It can also cover a corporation by estoppel or partnership by estoppel 90 91

5. A sole proprietorship may not be a party as it is neither a natural, juridical or entity allowed or authorized by law. If one sues as such, the action may be dismissed on the ground of lack of capacity to sue. It does not possess a juridical personality separate and distinct from the personality of the owner of the enterprise. It cannot sue or file or defend an action in court. 92 93

WHEN PARTIES IMPLEADED ARE NOT AUTHORIZED TO BE PARTIES

1. Where the plaintiff is not a natural or juridical person, or an entity authorized by law, a motion to dismiss may be filed on the ground that the plaintiff has no legal capacity to sue. Do not confuse it with one who has capacity to sue but he is not the real party in interest as the ground for dismissal then is failure to state a cause of action. 94

2. Where it is the defendant who is not any of the above, the complaint may be dismissed on the ground that the “pleading asserting the claim states no cause of action” or ‘failure to state a cause of action’ , because there cannot be a cause of action against one who cannot be a party to a civil action.

PARTIES IN INTEREST

1. A real party in interest is the party who stands to be benefited or injured by the judgment or party entitled to the avails of the suit. Unless otherwise authorized by law of the rules, like in a class suit, all actions must be prosecuted or defended in the name of the real party in interest. 95

89

Section 21, BP 68

90

Article 1825, NCC

91

Mangila v Court of Appeals, 387 SCRA 162, Yao Ka Sin Trading v Court of Appeals, 209 SCRA 763

92

Juasing Hardware v Mendoza, 115 SCRA 783

93

Balagtas v. Court of Appeals, 317 SCRA 69

94

(24)

1.1 A real party in interest-plaintiff is one who has a legal right, while a real party in interest-defendant is one who has a correlative obligation, whose act or omission violates the legal rights of the former. Hence, the determination of who 96

is a real party in interest goes back to the elements of a cause of action. Evidently, the owner of the right violated stands to be the real party in interest as plaintiff and the person responsible for the violation is the real party in interest defendant. 97

1.2 To be a real party in interest, the interest must be real, which is a present substantial interest as distinguished from a mere expectancy or a future, contingent, subordinate or consequential interest. It is an interest that is material and direct, as distinguished from a mere incidental interest in the question. 98

1.3 Illustrations: (a) In a case where a lawful possessor is disturbed in his possession, it is the possessor, not necessarily the owner, who can bring an action to recover the possession. (b) The parties to a contract are the real 99

parties in interest in an action upon it based on the doctrine of relativity of contracts under Article 1311, NCC, unless it conveys a benefit to a person not a party thereto (c) Actions under Articles 1313 and 1381, NCC when the contracts are entered into in fraud of creditors. (d) Suits by corporations must be in its name, not that of the stockholders or members.

2. When a suit is not brought in the name of the real party in interest, it may be dismissed on the ground that the complaint states no cause of action. Note 100

that the dismissal is not due to lack of or no legal capacity to sue nor lack of legal personality, as the latter is not ground for dismissal for under the 1997 Rules of Civil Procedure.

2.1 It states no cause of action because it is not being prosecuted in the name of the real party in interest.

2.2 Lack of Legal Capacity to Sue means that the plaintiff is not in exercise of his civil rights, does not have the necessary qualification to appear or does not have the character or representation he claims. Example: Trustee or Minor, as distinguished from Lack of Legal Personality means that the plaintiff is not the real party in interest. Dismissal is based on the fact that the complaint states no cause of action

Gan Hock v. Court of Appeals, 197 SCRA 223

96

Lee v. Romillo, 161 SCRA 589

97

Samaniego v. Aguila, 334 SCRA 438

98

Philippine Trust Company v. Court of Appeals, 320 SCRA 719

99

Tankiko v Cesar, 302 SCRA 559

(25)

3. Legal standing means a personal and substantial interest in the case such that the party has sustained or will sustain direct injury as a result of the act being challenged. The term interest is material interest, an interest in issue, and to be affected by the decree, as distinguished from mere interest in the question involved, or a mere incidental interest. Moreover, the interest must be personal and not one based on a desire to vindicate the constitutional right of some third or unrelated party.

3.1 However, the concept of ‘standing’ because of its constitutional underpinnings is very different from questions relating to whether or not a particular party is a real party-in-interest. Although both are directed towards ensuring that only certain parties can maintain an action, the concept of standing requires an analysis of broader policy concerns. The question as to who the real party-in-interest is involves only a question on whether a person would be benefited or injured by the judgment or whether or not he is entitled to the avails of the suit. 101

3.2 Locus standi is defined as a right of appearance in a court of justice on a given question. In private suits, standing is governed by the “real-parties-in interest” rule found in Section 2, Rule 3 of the Rules of Court which provides that every action must be prosecuted or defended in the name of the real party-in-interest. In other cases, locus standi is a party’s personal and substantial 102

interest in a case such that he has sustained or will sustain a direct injury as a result of the governmental act being challenged. It calls for more than generalized grievance. The term “interest” means a material interest, an interest in issue affected by the decree, as distinguished from a mere interest in the question involved or a mere incidental interest.103 Unless a person’s constitutional rights are adversely affected by the statute or ordinance, he has no legal standing.

4. Be that as it may, we have on several occasions relaxed the application of these rules on legal standing:

“In not a few cases, the Court has liberalized the locus standi requirement when a petition raises an issue of transcendental significance or paramount importance to the people. Recently, after holding that the IBP had no locus standi to bring the suit, the Court in IBP v. Zamora nevertheless entertained the Petition therein. It noted that “the IBP has advanced constitutional issues which deserve the attention of this Court in view of their seriousness, novelty and weight as precedents.” 104

Kilosbayan, Inc. vs. Morato, 246 SCRA 540

101

Baltazar vs. Ombudsman, G.R. No. 136433, December 6, 2006

102

Velarde v Social Justice Society, 392 Phil 618, IBP v Zamora, 338 SCRA 81

103

Velarde v. Social Justice Society, supra at note 22, citations omitted.

(26)

4.1 Objections to a taxpayer’s suit for lack of sufficient personality, standing or interest are procedural matters. Considering the importance to the public of a suit assailing the constitutionality of a tax law, and in keeping with the Court’s duty, specially explicated in the 1987 Constitution, to determine whether or not the other branches of the Government have kept themselves within the limits of the Constitution and the laws and that they have not abused the discretion given to them, the Supreme Court may brush aside technicalities of procedure and take cognizance of the suit. 105

4.2 There being no doctrinal definition of transcendental importance, the following determinants formulated by former Supreme Court Justice Florentino P. Feliciano are instructive: (1) the character of the funds or other assets involved in the case; (2) the presence of a clear case of disregard of a constitutional or statutory prohibition by the public respondent agency or instrumentality of the government; and (3) the lack of any other party with a more direct and specific interest in raising the questions being raised. 106

CLASSIFICATION OF REAL PARTIES IN INTEREST

1. Indispensable Party is a party without whom no final determination can be had of an action. They are those with such an interest in the controversy that a 107

final decree would necessarily affect their rights, so that the courts cannot proceed without their presence. Example: owners of property over which reconveyance is asserted are indispensable parties without whom no relief is available and without whom the court can render no valid judgment. 108

1.1 Without the presence of indispensable parties to the suit, the judgment of the court cannot attain real finality. Strangers to a case are not bound by the 109

judgment rendered by the court. 110

Bugnay Construction and Development Corporation v. Hon. Laron, G.R. No. 79983, 10 August 1989,

105

176 SCRA 240, 251, citing Kapatiran ng mga Naglilingkod sa Pamahalaan ng Pilipinas, Inc. v. Tan, G.R. No. 81311, 30 June 1988, 163 SCRA 371, 378.

Francisco v. Nagmamalasakit na mga Manggagawang Pilipino, Inc., supra at note 30, citing Kilosbayan,

106

Incorporated v. Guingona, Jr., 232 SCRA 110 (1994) Supra, Section 7, Rule 3

107

Valenzuela v Court of Appeals, 363 SCRA 779

108

Domingo v Scheer, 421 SCRA 468

109

Lucman v Malawi, GR No. 159794, December 19, 2006

(27)

1.2 The essential tests of an indispensable party: (a) May relief be afforded the plaintiff without the presence of the other party? (b) May the case be decided on the merits without impairing the substantial rights of the other party? 111

2. Necessary Party is a party who is not indispensable but who ought to be joined as a party if complete relief is to be accorded as to those already parties or for a complete determination or settlement of the claim subject of the action. A 112

necessary party’s presence is necessary to adjudicate the whole controversy but whose interests are so far separable that a final decree can be made in their absence without affecting them.

2.1 Example: If the plaintiff only sues a one of his joint debtors, the joint debtor who is not sued is merely a necessary party. As a consequence, the plaintiff only recovers the share of the debt due from the joint debtor defendant.

2.2 A necessary party is to be impleaded as a party for complete determination of an action, while an indispensable party is impleaded for a final determination of an action.

3. Pro-Forma Party or nominal party is one who is joined as a plaintiff or defendant not because such party has any real interest in the subject matter or because relief is demanded, but merely because the technical rules of pleadings require the presence of such party on the record. 113

PERSONS WHO CAN SUE IN BEHALF OF A REAL PARTY IN INTEREST The following may sue in behalf of a real party in interest

1. Representatives- actions are allowed to be prosecuted / defended by a representative or by one acting in a fiduciary capacity but the beneficiary shall be included in the title and shall be deemed to be the real party in interest. 114

Examples of representatives are: (a) trustee of an express trust (b) a guardian, executor or administrator, or (c) a party authorized by law or the Rules.

1.2 An agent acting in his own name and for the benefit of an unknown principal may sue or be sued without joining the principal except when the

PNB v. Militar, 467 SCRA 377

111

112

Samaniego v. Aguila, 334 SCRA 438

113

(28)

contract involves things belonging to the principal. This refers to an agency with an undisclosed principal. 115

2. Husband and Wife- as a general rule shall sue or be sued jointly, except as provided by law. Non joinder of party’s husband is not fatal. It is a mere 116

formal defect. 117

2.1 They are required to sue and be sued jointly as they are joint administrators of the Absolute Community or the Conjugal Partnership. 118

2.2 The exceptions provided by law are when the property relations of husband and wife are governed by the rules on separation of property or one 119

is disposing of exclusive property. 120

2.3 Note that the legal provision against the disposition of conjugal property by one spouse without the consent of the other has been established for the benefit, not of third persons, but only for the spouse for whom the law desires to save the conjugal partnership from damages that might be caused. No other party can avail of the remedy other than the aggrieved spouse. 121

3. Minors or Incompetents may sue or be sued with the assistance of father, mother, guardian or, if he has none, a guardian ad litem. 122

3.1 A guardian ad litem is a special guardian appointed by the court in which a particular litigation is pending to represent or assist a minor or an incompetent person involved in or has interest in the property subject of litigation. His status as such exists only in that particular litigation in which the appointment occurs. 3.2 Note that the appointment of a guardian ad litem may occur in the following: for minor heirs when substituting for a deceased party123,

Article 1883, NCC

115

116

Miranda v Besa, 435 SCRA 532

117

Articles 96 and 124, Family Code

118

Article 145, Family Code

119

120

Villaranda v Villaranda, 423 SCRA 571

121

122

(29)

incompetency or incapacity of a party , service of summons on a minor or 124

incompetent , and when the best interest of the child require it. 125 126

JOINDER OF PARTIES

Joinder of Parties refers to the act of uniting several parties in a single suit either as plaintiffs or defendants.

1. The rule on joinder of parties states that: All persons in whom or against whom any right to relief in respect to or arising out of the same transaction is alleged to exist, whether jointly, severally or in the alternative, may except as otherwise provided in these rules, join as plaintiffs or be joined as defendants in one complaint, where any question of law or fact common to all such plaintiffs or to all such defendants may arise in the action. 127

2. Joinder of Parties, as a rule, is permissive when there is a question of law or fact common to all the plaintiffs or defendants. This means that the right to relief or to resist the action arises out of the same transaction or event or series of transactions or events. Example: action by passengers of a common carrier for injuries sustained in an accident, there is no community of interest, the extent of the interest is limited to the extent of damages being claimed by each.

3. It becomes compulsory when the parties to be joined are indispensable parties. 128

4. The exception to compulsory joinder of parties is when the subject of the action is proper for a class suit. The subject matter of the controversy is proper for a class suit when it is one of common or general interest to many persons so numerous that it is impractical to join all as parties. All the parties who are 129

interested in the action as plaintiffs or defendants are all indispensable parties but not all need to be joined.

5. The three requisites of a class suit are:

5.1 The subject matter of the controversy is one of common or general interest to many persons. There must be an indivisible right affecting many

124

125

126

127

128

(30)

individuals whose particular interest is of indeterminable extent and is incapable of separation. This requires that the benefit to one is a benefit to all. Example: A suit filed by minors represented by their parents, in behalf of themselves and others equally concerned with the preservation of the country’s resources, their generation as well as generations yet unborn to compel the DENR Secretary to cancel all timber license agreements and to cease and desist from receiving, accepting, processing, renewing or approving new timber license agreements . 130

The interest must be common and not independent of each member of the class and should not conflict with each other. For this reason, owners of subdivision lots in a subdivision cannot sue as a class because their interest is only in their respective lots. 131

5.2 The parties affected are so numerous that it is impracticable to join all as parties

5.3 The parties bringing or defending the class suit are found by the court to be sufficiently numerous and representative as to fully protect the interest of all. 5.4 To comply with the 2nd_{and 3}rd_{requisite, the Complaint most allege: (1)}

existence of a subject matter which is of common or general interest to many persons, and (2) existence of a class and the number of persons belonging to that class

6. Improper for a class suit is when a claimant is interested only in collecting his claims and has no concern in protecting the interests of the others or each 132

of the plaintiffs has a separate claim or injuries not shared in common by the others. Hence, each must prove his own damages. 133

7. It can be brought by the plaintiffs as a class or may be filed against the defendants as a class

7.1 Any party in interest shall have the right to intervene to protect his individual interest.

7.2 The general rule, is that the party bringing the suit in his own name and that of others similarly situated has the right to control the suit, but, it shall not be dismissed or compromised without the approval of the court. 134

Oposa v Factoran, 224 SCRA 792

130

Tuason v. Register of Deeds, 157 SCRA 613

131

Cadalin v POEA Administrator, 238 SCRA 721

132

Newsweek Inc. v. IAC, 142 SCRA 171

133