Topic: Instances of motu proprio dismissal
Heirs of Mariano Favis, et al., v. Juana Gonzales, et al., G.R. No. 185922, January 15, 2014
FACTS: Dr. Mariano Favis, Sr. (Dr. Favis) was married to Capitolina Aguilar (Capitolina) with whom he had seven
children. When Capitolina died in March 1994. Dr. Favis married Juana Gonzalez (Juana), his common-law wife with
whom he sired one child, Mariano G. Favis (Mariano), he executed an affidavit acknowledging Mariano as one of his
legitimate children. Mariano is married to Larcelita D. Favis (Larcelita), with whom he has four children.
Dr. Favis died intestate on July 29, 1995. On October 16, 1994, prior his death, he allegedly executed a Deed of
Donation transferring and conveying properties in favor of his grandchildren with Juana. Claiming the said donation
prejudiced their legitime, Dr. Favis children with Capitolina, petitioners herein, filed an action for annulment of the
Deed of Donation, inventory, liquidation, liquidation and partition of property before the RTC against Juana, Sps.
Mariano and Larcelita and their grandchildren as respondents.
RTC nullified the Deed of Donation. The trial court found that Dr. Favis, at the age of 92 and plagued with illnesses,
could not have had full control of his mental capacities to execute a valid Deed of Donation.
The Court of Appeals ordered the dismissal of the petitioners nullification case. The CA motu proprioproprio ordered
the dismissal of the complaint for failure of petitioners to make an averment that earnest efforts toward a compromise
have been made, as mandated by Article 151 of the Family Court.
ISSUE: May the appellate court dismiss the order of dismissal of the complaint for failure to allege therein that earnest
efforts towards a compromise have been made?
HELD: The appellate court committed egregious error in dismissing the complaint.
The appellate court committed egregious error in dismissing the complaint. The appellate courts decision hinged on
Article 151 of the Family Code, Art.151.No suit between members of the same family shall prosper unless it should
appear from the verified complaint or petition that earnest efforts toward a compromise have been made, but that the
same have failed. If it is shown that no such efforts were in fact made, the case must be dismissed.
The appellate court correlated this provision with Section 1, par. (j), Rule 16 of the 1997 Rules of Civil Procedure,
which provides: Section 1. Grounds. - Within the time for but before filing the answer to the complaint or pleading
asserting a claim, a motion to dismiss may be made on any of the following grounds:(j) That a condition precedent
for filing the claim has not been complied with.
The appellate courts reliance on this provision is misplaced. Rule 16 treats of the grounds for a motion to dismiss the
complaint. It must be distinguished from the grounds provided under Section 1, Rule 9 which specifically deals with
dismissal of the claim by the court motu proprio. Section 1, Rule 9 of the 1997 Rules of Civil Procedure. Section 1,
Rule 9 provides for only four instances when the court may motu proprio dismiss the claim, namely: (a) lack of
jurisdiction over the subject matter; (b) litis pendentia; (c) res judicata; and (d) prescription of action.
It was in Heirs of Domingo Valientes v. Ramas cited in P.L. Uy Realty Corporation v. ALS Management and
Development Corporation where we noted that the second sentence of Section 1 of Rule 9 does not only supply
exceptions to the rule that defenses not pleaded either in a motion to dismiss or in the answer are deemed waived, it
also allows courts to dismiss cases motu proprio on any of the enumerated grounds. The tenor of the second sentence
of the Rule is that the allowance of a motu propio dismissal can proceed only from the exemption from the rule on
waiver; which is but logical because there can be no ruling on a waived ground.
A failure to allege earnest but failed efforts at a compromise in a complaint among members of the same family, is
not a jurisdictional defect but merely a defect in the statement of a cause of action.
In the case at hand, the proceedings before the trial court ran the full course. The complaint of petitioners was answered
by respondents without a prior motion to dismiss having been filed. The decision in favor of the petitioners was
appealed by respondents on the basis of the alleged error in the ruling on the merits, no mention having been made
about any defect in the statement of a cause of action. In other words, no motion to dismiss the complaint based on
the failure to comply with a condition precedent was filed in the trial court; neither was such failure assigned as error
in the appeal that respondent brought before the Court of Appeals.
Therefore, the rule on deemed waiver of the non-jurisdictional defense or objection is wholly applicable to respondent.
If the respondents as parties-defendants could not, and did not, after filing their answer to petitioners complaint, invoke
the objection of absence of the required allegation on earnest efforts at a compromise, the appellate court
unquestionably did not have any authority or basis to motu propio order the dismissal of petitioners complaint.
The correctness of the finding was not touched by the Court of Appeals. The respondents opted to rely only on what
the appellate court considered, erroneously though, was a procedural infirmity. The trial court's factual finding,
therefore, stands unreversed; and respondents did not provide us with any argument to have it reversed.
The decision of the Court of Appeals is reversed and set aside and the Judgment of the Regional Trial Court is
AFFIRMED. GRANTED.
Topic: Dismissal upon notice by plaintiff; two-dismissal rule
Go v. Cruz, et al., G.R. No. 58986, April 17, 1982
Facts:
California Manufacturing Co., Inc. (hereinafter, simply, California) brought an action in the Court of First Instance
of Manila against Dante Go, accusing him of unfair competition.
that Dante Go, doing business under the name and style of "Sugarland International Products," and engaged like
California in the manufacture of spaghetti, macaroni, and other pasta, was selling... his products in the open market
under the brand name, "Great Italian," in packages which were in colorable and deceitful imitation of California's
containers bearing its own brand, "Royal.
two weeks later, however, or on November 12, 1981, California filed a notice of dismissal
Four days afterwards
California received by registered mail a copy of Dante Go's answer with counterclaim
On November 19, 1981 a fire broke out at the Manila City Hall destroying among others the sala of Judge Tengco
and the records of cases therein kept, including that filed by California against Dante Go.
December 1, 1981, California filed another complaint asserting the same cause of action against Dante Go, this time
with the Court of First Instance at Caloocan
Judge Cruz issued an ex parte restraining order
Dante Go filed the present petition for certiorari, etc. with this Court praying for its nullification and perpetual
inhibition.
this Court, in turn,... issued a writ of preliminary injunction restraining California, Judge Cruz and the City Sheriff
from enforcing or implementing the restraining order
Issues: Dante Go's thesis is that the case filed against him by California in the Manila Court remained pending
despite California's notice of dismissal.
Held:
The dismissal of civil actions is always addressed to the sound judgment and discretion of the court; this, whether
the dismissal is sought after a trial has been completed or otherwise, 1 or whether it is prayed for by a defending
party, 2 or by a plaintiff or claimant. 3 There is one instance however where the dismissal of an action rests
exclusively on the will of a plaintiff or claimant, to prevent which the defending party and even the court itself is
powerless, requiring in fact no action whatever on the part of the court except the acceptance and recording of the
causative document.
Dismissal by the plaintiff. — An action may be dismissed by the plaintiff without order of court by filing a notice of
dismissal at any time before service of the answer or of a motion for summary judgment. Unless otherwise stated in
the notice, the dismissal is without prejudice, except that a notice operates as an adjudication upon the merits when
filed by a plaintiff who has once dismissed in a competent court an action based on or including the same claim. A
class suit shall not be dismissed or compromised without approval of the court.
Topic: Dismissal due to fault of plaintiff
Shimizu Philippines Contractor, Inc. v. Mrs. Leticia B. Magsalin, et al., G.R. No. 170026, June 20, 2012
Facts:
The petitioner claims that one Leticia Magsalin, doing business as "Karen's Trading," had breached their subcontract
agreement for the supply, delivery, installation, and finishing of parquet... tiles for certain floors in the petitioner's
Makati City condominium project called "The Regency at Salcedo."
When Magsalin also refused to return the petitioner's unliquidated advance payment and to account for other
monetary... liabilities despite demand, the petitioner sent a notice to respondent FGU Insurance Corporation (FGU
Insurance) demanding damages pursuant to the surety and performance bonds the former had issued for the
subcontract.
the petitioner filed a complaint... against both Magsalin and FGU Insurance.
FGU Insurance filed a motion to dismiss the complaint.
was denied as well as the ensuing motion for reconsideration, and FGU Insurance was obliged to file an answer.
FGU Insurance filed a motion for leave of court to file a third-party complaint.
Reynaldo Baetiong, Godofredo Garcia and Concordia Garcia named as third-party defendants.
Civil Case No. 02-488.
FGU Insurance filed a motion to cancel the hearing on the ground that the third-party defendants had not yet filed
their answer. The motion was granted.
Baetiong filed his answer to the third-party complaint. He denied any personal knowledge about the surety and
performance bonds for the subcontract with Magsalin.[7] Of the three (3) persons named as third-party defendants,
only Baetiong filed... an answer to the third-party complaint; the officer's returns on the summons to the Garcias
state that both could not be located at their given addresses. Incidentally, the petitioner claims, and Baetiong does
not dispute, that it was not served with a copy of Baetiong's answer.
The petitioner now argues before us that FGU Insurance, which is the plaintiff in the third-party complaint, had
failed to exert efforts to serve summons on the Garcias.
the RTC
DISMISSED
FGU Insurance moved for the dismissal of the appeal on the ground of lack of jurisdiction. I
The CA agreed
Issues:
THE LOWER COURT ERRED IN DECLARING THAT PETITIONER FAILED TO PROSECUTE THE CASE
DESPITE THE FACT THAT PETITIONER NEVER RECEIVED A COPY OF THE ANSWER OF THIRDPARTY DEFENDANT-RESPONDENT REYNALDO BAETIONG.
HELD:
THE DISMISSAL ORDER IS VOID
We also find that the dismissal of Civil Case No. 02-488 is not warranted. Based on available records and on the
averments of the parties, the following events were chronologically proximate to the dismissal of Civil Case No. 02488: (a) on March 24, 2003, the court admitted FGU
Insurance's third-party complaint; (b) the trial court cancelled the June 20, 2003 hearing upon FGU Insurance's
motion; and (c) on June 16, 2003, Baetiong filed his Answer to the third-party complaint but did not serve it upon
the petitioner.
None of these events square with the grounds specified by Section 3, Rule 17 of the Rules of Court for the motu
proprio dismissal of a case for failure to prosecute. These grounds are as follows:
(a) Failure of the plaintiff, without justifiable reasons, to appear on the date of the presentation of his evidence in
chief;
(b) Failure of the plaintiff to prosecute his action for an unreasonable length of time;
(c) Failure of the plaintiff to comply with the Rules of Court; or
(d) Failure of the plaintiff to obey any order of the court.
In our view, the developments in the present case do not satisfy the stringent standards set in law and jurisprudence
for a non prosequitur.[33] The fundamental test for non prosequitur is whether, under the circumstances, the plaintiff
is... chargeable with want of due diligence in failing to proceed with reasonable promptitude.[34] There must be
unwillingness on the part of the plaintiff to prosecute.[35]
In this case, the parties' own narrations of facts demonstrate the petitioner's willingness to prosecute its complaint.
Indeed, neither respondents FGU Insurance nor Baetiong was able to point to any specific act committed by the
petitioner to justify the dismissal of their... case.
Ma. Mercedes L. Barba v. Liceo de Cagayan University, G.R. No. 193857, November 28, 2012
FACTS: Petitioner Dr. Ma. Mercedes L. Barba (Barba) was the Dean of the College of Physical Therapy of respondent
Liceo de Cagayan University, Inc. (Liceo).
When Barba started working for Liceo, she was chosen as a scholar. Her scholarship contract provides that after the
duration of her study, she shall serve the school in whatever position the school desires for a period of not less than
ten (10) years. After her scholarship, she was appointed as the Dean of the College of Physical Therapy.
In the school year 2003 to 2004, the College of Physical Therapy suffered a dramatic decline in the number of enrollees
from a total of 1,121 students in the school year 1995 to 1996 to only 29 students in the first semester of school year
2003 to 2004.
Due to the low number of enrollees, Liceo decided to freeze the operation of the College of Physical Therapy
indefinitely. Thereafter, the College of Physical Therapy ceased operations and Barba went on leave without pay
starting. Subsequently, Liceo sent Barba a letter dated April 27, 2005 instructing Barba to return to work on and report
to Ma. Chona Palomares, the Acting Dean of the College of Nursing, to receive her teaching load and assignment as
a full-time faculty member in that department. Barba did not report to Palomares and requested for the processing of
her separation benefits in view of the closure of the College of Physical Therapy.
Another letter was sent to Barba but the latter still refused to return to work. Hence, Liceo sent Barba a notice
terminating her services on the ground of abandonment.
Barba filed a complaint before the Labor Arbiter for illegal dismissal, payment of separation pay and retirement
benefits against Liceo. She alleged that her transfer to the College of Nursing as a faculty member is a demotion
amounting to constructive dismissal.
The LA ruled that Barba was not constructively dismissed. The NLRC reversed the LA. Liceo went to the CA and
filed a Supplemental Petition raising for the first time the issue of lack of jurisdiction of the Labor Arbiter and the
NLRC over the case. Liceo claimed that a College Dean is a corporate officer under its by-laws and Barba was a
corporate officer of Liceo since her appointment was approved by the board of directors. Thus, Liceo maintained that
the jurisdiction over the case is with the regular courts and not with the labor tribunals.
In its original Decision, the CA reversed the NLRC resolutions. The CA did not find merit in Liceo’s assertion in its
Supplemental Petition that the position of Barba as College Dean was a corporate office. The CA further found that
no constructive dismissal occurred nor has Barba abandoned her work.
Unsatisfied, both Barba and Liceo sought reconsideration of the CA decision. The CA reversed its earlier ruling.
Hence, Barba filed the present petition.
ISSUES: Does the labor tribunals have jurisdiction over Barba’s complaint for constructive dismissal?
Was Barba constructively dismissed?
HELD: Corporate officers are elected or appointed by the directors or stockholders, and are those who are given that
character either by the Corporation Code or by the corporation’s by-laws. Section 25 of the Corporation Code
enumerates corporate officers as the president, the secretary, the treasurer and such other officers as may be provided
for in the by-laws. In Matling Industrial and Commercial Corporation v. Coros, the phrase “such other officers as may
be provided for in the by-laws” has been clarified, thus: “Conformably with Section 25, a position must be expressly
mentioned in the By-Laws in order to be considered as a corporate office. The rest of the corporate officers could be
considered only as employees of subordinate officials.”
However, an assiduous perusal of these documents does not convince us that Barba occupies a corporate office
position in the university. In Liceo’s by-laws, there are four officers specifically mentioned, namely, a president, a
vice president, a secretary and a treasurer. In addition, it is provided that there shall be other appointive officials, a
College Director and heads of departments whose appointments, compensations, powers and duties shall be
determined by the board of directors. It is worthy to note that a College Dean is not among the corporate officers
mentioned in Liceo’s by-laws. Barba was not directly elected nor appointed by the board of directors to any corporate
office but her appointment was merely approved by the board together with the other academic deans of respondent
university in accordance with the procedure prescribed in Liceo’s Administrative Manual. Though the board of
directors may create appointive positions other than the positions of corporate officers, the persons occupying such
positions cannot be deemed as corporate officers as contemplated by Section 25 of the Corporation Code. Thus,
petitioner, being an employee of respondent, her complaint for illegal/constructive dismissal against respondent was
properly within the jurisdiction of the Labor Arbiter and the NLRC.
On the issue of constructive dismissal, we agree with the Labor Arbiter and the appellate court’s earlier ruling that
Barba was not constructively dismissed. Barba’s letter of appointment specifically appointed her as Dean of the
College of Physical Therapy and Doctor-in- Charge of the Rehabilitation Clinic “for a period of three years effective
July 1, 2002 unless sooner revoked for valid cause or causes.” Evidently, Barba’s appointment as College Dean was
for a fixed term, subject to reappointment and revocation or termination for a valid cause. When Liceo decided to
close its College of Physical Therapy due to drastic decrease in enrollees, Barba’s appointment as its College Dean
was validly revoked and her subsequent assignment to teach in the College of Nursing was justified as it is still related
to her scholarship studies in Physical Therapy. Particularly, for a transfer not to be considered a constructive dismissal,
the employer must be able to show that such transfer is not unreasonable, inconvenient, or prejudicial to the employee.
GRANTED.
Eloisa Merchandising, Inc. and Trebel International Inc. v. BDO Universal Bank, et al., G.R. No. 192716, June 13,
2012
Facts: Respondent BDO extended a credit accommodation to petitioner Eloisa Merchandising, Inc. (EMI)and it was
secured by a real estate mortgage (REM) over its properties. BDO filed an application for extrajudicial
foreclosure before the Office of the Ex-Officio Sheriff, RTC. A notice was issued setting the auction sale of the
mortgaged properties. Hence, petitioners filed a complaintfor the annulment of REM. BDO filed a motion to
dismiss on the ground of lack of cause of action but it was denied. BDO then filed its answer. The petitioners
failed to appear twice during the pre-trial conference despite notice. Hence, the case was also dismissed twice. The
case was once again dismissed due to inaction of petitioners for unreasonable length of time. Petitioners appealed to
the CA but it affirmed the trial court’s dismissal. Hence, the petition for review under Rule 45. Petitioners contend
that the only reason for the trial court’s dismissal of the case was the failure oftheir counsel to move to set the case for
pre-trial.
Ruling: Under Section 3,[24]Rule 17 of the1997 Rules of Civil Procedure, as amended, the failure onthe part of the
plaintiff, without any justifiable cause, to comply with any order of the court or the Rules, or to prosecute his action
for an unreasonable length of time, may result in the dismissal of the complaint eithermotu proprioor on motion by
the defendant.The failure of a plaintiff to prosecute the action without any justifiable cause within a reasonable period
of time will give rise to the presumption that he is no longer interested to obtain from the court the relief prayed for in
his complaint; hence, the court is authorized to order the dismissal of the complaint on its own motion or on
motion of the defendants. The presumption is not, by any means, conclusive because the plaintiff, on a motion for
reconsideration of the order of dismissal,may allege and establish a justifiable cause for such failure.[25]The burden
to show that there are compelling reasons that would make a dismissal of the case unjustified is on the petitioners.
Topic: Court Annexed Mediation (CAM)
Real Bank, Inc. v. Samsung Mabuhay Corporation, G.R. No. 175862, October 13, 2010
SUMMARY: In a Complaint for Damages filed by Samsung against Real Bank which was set for a mediation
conference, Samsung failed to appear because the order requiring Samsung to appear was sent to its former counsel.
The trial court dismissed the case for Samsung’s failure to appear at the said conference. The SC remanded the case
back to the TC.
DOCTRINE: Under the first sentence of Section 26, the withdrawal of counsel with the conformity of the client is
completed once the same is filed in court. No further action thereon by the court is needed other than the mechanical
act of the Clerk of Court of entering the name of the new counsel in the docket and of giving written notice thereof to
the adverse party.
FACTS OF THE CASE: Initially, Samsung Mabuhay Corp. file a Complaint for Damages against Real Bank, Inc. o
The background of which involved checks supposedly for Samsung Mabuhay Corp. being deposited by a certain
Reynaldo A. Senson (alias Edgardo Bacea) who deposited such checks into his account with Real Bank, Inc. Real
Bank, Inc. filed its Answer on 23 February 1998, to which a Reply was filed by respondent Samsung on 5 March
1998. On 12 March 1998, Samsung filed an Ex-Parte Motion to Set Case for Pre-Trial. Judge Infante of RTC Br. 9 of
Manila set the case for pre-trial on 25 June 1998. On 26 May 1998, Real Bank, Inc. filed a Motion to Admit Third
Party Complaint against Senson. On 22 June 1998, Samsung filed its Pre-Trial Brief. Pre-trial was rescheduled and
reset to 10 September 1998 on motion of Real Bank due to its prior motion still pending resolution. Finally, on 22
February 1999, the trial court issued an Order granting Real Bank’s Motion to Admit Third Party Complaint. Real
Bank also filed a Motion to Serve Summons by Publication on Senson, which Judge Infante granted. On 19 October
2000, counsel for Samsung filed a Notice of Withdrawal of Appearance with conformity of Samsung. On 7 March
2001, the TC issued an Order requiring both Real Bank, Inc. and Samsung to appear in a mediation proceeding set on
3 April 2001, such order being sent to Samsung’s former counsel. o Mediation proceedings took place as scheduled,
with Samsung not appearing. On 4 June 2001, the new counsel of Samsung entered its appearance, which was filed
and received by the court on 6 June 2001. Subsequently, the case was re-raffled to RTC Br. 20 of Manila.
ISSUE: W/N the trial court correctly dismissed the case for failure of Samsung Mabuhay Corp. to appear at the
scheduled mediation conference
HELD: NO.In Senarlo v. Judge Paderanga, the SC accentuated that mediation is part of pre-trial and failure of the
plaintiff to appear thereat merits sanction on the part of the absent party. However, the ruling in Senarlo will not
resolve the present case where the basic issue is whether or not respondent’s Samsung non-appearance at the mediation
the conformity of the client is completed once the same is filed in court. No further action thereon by the court is
needed other than the mechanical act of the Clerk of Court of entering the name of the new counsel in the docket and
of giving written notice thereof to the adverse party. In this case, it is uncontroverted that the withdrawal of respondent
Samsung’s original counsel, V.E. Del Rosario and Partners on 19 October 2000, was with the client’s consent. Thus,
no approval thereof by the trial court was required because a court’s approval is indispensable only if the withdrawal
is without the client’s consent. It is clear that the withdrawal of Samsung’s original counsel was sufficient as the same
carried the stamp of approval of the client, the notice of mediation sent to Samsung’s original counsel was ineffectual
as the same was sent at the time when such counsel had already validly withdrawn its representation. Corollary, the
absence of Samsung during the scheduled mediation conference was excusable and justified. Therefore, the trial court
erroneously dismissed Samsung’s complaint.
Topic: Barangay conciliation
Gegare v. CA, G.R. No 83907, September 13, 1989
DOCTRINE: The purpose of this confrontation is to enable the parties to settle their differences amicably. If the
other only contending party is the government or its instrumentality or subdivision the case falls within the
exception but when it is only one of the contending parties, a confrontation should still be undertaken among the other
parties.
FACTS: This case involves a small piece of land. The decision was to cut it into two between the parties. But the
parallel ends there. The petitioner wants the whole lot. Private respondent is happy with his half. This is the impasse
that must be resolved. petitioner argues that it was erroneous for the appellate court to hold that the case should be
dismissed by the lower court for failure to comply with a provision of Presidential Decree No. 1508 before filing the
complaint. He alleges that this rule is not applicable in said case for one of the parties therein is the government or
any subdivision or instrumentality thereof which is excepted from this requirement under Section 2 of said law.
RULING: True it is that the Board is a government instrumentality but the petitioner and private respondent who are
also contending parties in the case are residents of the same barangay so Section 6 of Presidential Decree No. 1508
should apply to them as it provides—
Section 6. Conciliation, pre-condition to filing of complaint. No complaint, petition, action or proceeding involving
any matter within the authority of the Lupon as provided in Section 2 hereof shall be filed or instituted in court or any
other government office for adjudication unless there has been a confrontation of the parties before the Lupon
Chairman or the Pangkat and no conciliation or settlement has been reached as certified by the LuponSecretary or the
Pangkat Secretary attested by the Lupon or Pangkat Chairman, or unless the settlement has been repudiated.
The purpose of this confrontation is to enable the parties to settle their differences amicably. If the other only
contending party is the government or its instrumentality or subdivision the case falls within the exception but when
it is only one of the contending parties, a confrontation should still be undertaken among the other parties.
Sanchez v. Tupaz, G.R. No. 76690, February 29, 1988
DOCTRINE: Presidential Decree No. 1508 requires that the parties who actually reside in the same city or
municipality should bring their controversy first to the Barangay Court for possible amicable settlement before filing
a complaint in court. This requirement is compulsory (as ruled in the cited case of Morato vs. Go, 125 SCRA
444), [1983] and non-compliance of the same could affect the sufficiency of the cause of action and make the
complaint vulnerable to dismissal on the ground of lack of cause of action or prematurity (Peregrina vs.
Panis, 133 SCRA 75). [1984] It must be borne in mind that the purpose of the conciliation process at the
barangay level is to discourage indiscriminate filing of cases in court in order to decongest the clogged dockets and
in the process enhance the quality of justice dispensed by courts.(Morato vs. Go, supra)
FACTS :
Claudia Rivera Sanchez, petitioner and Alfonso Escovilla, private respondent are both occupants of a public
agricultural land Identified as Lot 595, Cad-102 located at Budbud, Tibungco, Davao City. Sanchez claims that the
area of 450 square meters, more or less, has been in her possession since 1947, long before Escovilla came in and
occupied another portion of Lot 595. On the other hand, Escovilla stated that the area being claimed by petitioner is a
part of his three-fourth (3/4) of a hectare parcel, the right to which he acquired from its former possessor and owner
of the improvements thereon. Sometime in 1966, out of charity and upon their agreement that petitioner will vacate
the premises upon demand, he granted petitioner's request to build her house inside the land occupied by him.
Escovilla filed an ejectment case in the City court of Davao against Sanchez. The court rendered judgment through a
“Judgment by Compromise”.
Sanchez filed a petition to annul judgment in the RTC of Davao. In her petition, she alleged that she was an illiterate
and did not know that what he counsel presented which she had signed using her thumbmark was a Compromise
Agreement which recognized Escovilla’s prior occupancy of the land in dispute; that she was only able to discover
this when she received an Order of Guillermo C. Ferraris, OIC Regional Director of Lands, dropping her petition,
together with the petitions of three others, based, allegedly, on their withdrawal, of their claims over the disputed land;
that she had never intended to recognize the private respondent as having prior possession and occupancy of the land,
the truth of the matter being that she had been in possession of the area of 450 square meters, more or less, since 1947,
long before private respondent came in and occupied another portion of Lot 595; that in sheer bad faith, private
respondent caused the survey of the entire Lot No. 595 sometime in 1980, which survey became null and void after
the same was formally opposed by Eufemio Escovilla, brother of private respondent, before Atty. Uldarico G. Aquino,
then District Officer, Bureau of Lands, Davao City; that on January 21, 1982, petitioner and the other occupants
Eufemio Escovilla, Damaso Escovilla and Emiliana Monleon, requested the Land District Officer to authorize
Geodetic Engineer Timoteo D. Cajipe of the same Office to execute a segregation survey; that the request was granted
and the District Land Officer, Atty. Bienvenido Sambrano, directed Engr. Timoteo D. Cajipe to survey the land; that
Engr. Cajipe was not able to conduct the segregation survey because private respondent threatened bodily harm on
and even death to the survey team, especially against the petitioner and the other actual occupants; and that pursuant
to the 1st Indorsement of the District Land Officer dated January 21, 1982, Land Investigator Manuel Flores conducted
an investigation of the disputed area.
Private respondent, in a Motion to Dismiss dated May 7,1986, moved for the dismissal of the complaint on the grounds
that (1) the records of the case do not show that the same has been referred to the barangay court for confrontation,
conciliation or settlement of the parties concerned as required under the provisions of Section 6 of PD 1508, and as
ruled by the Supreme Court in Spouses Maria Luisa P. Morata, et al. vs. Spouses Victor Go, et al., G.R. L-62339,
October 27, 1983, 125 SCRA 444; and (2) the complaint does not state a cause of action.
On May 12, 1986, petitioner filed an Opposition to the Motion to Dismiss on the grounds that (1) the motion to dismiss
was filed beyond the period prescribed by the Rules of Court; and (2) the petition states a cause of action.
On the same date, May 12,1986, private respondent filed his Answer and his Reply to Opposition to Motion to Dismiss,
Opposition to Prayer therein to Declare Defendant in Default, and Manifestation, dated May 12, 1986.
On May 26,1986, petitioner filed a Supplemental Opposition to Motion to Dismiss. Respondent Judge in an order
dated May 16, 1986, granted the prayer of counsel for private respondent to be allowed one (1) week to file a
memorandum in support of his stand, which was to be commented upon within like period by petitioner's counsel;
after which, all the pending incidents are to be deemed submitted for the resolution of the Court.
On May 29,1986, private respondent submitted his Memorandum.
In an Order dated October 10, 1986, respondent Judge sustained private respondent's Motion to Dismiss by dismissing
the case for lack of cause of action or prematurity for not having passed the Barangay Court.
ISSUE/S:
1. WON the RTC gravely erred in dismissing the petition for annulment of judgment because it did not pass Barangay
Conciliation
2. WON the Compromise agreement shall be null and void
HELD:
1.YES. Presidential Decree No. 1508 requires that the parties who actually reside in the same city or municipality
should bring their controversy first to the Barangay Court for possible amicable settlement before filing a complaint
in court. This requirement is compulsory (as ruled in the cited case of Morato vs. Go, 125 SCRA 444), [1983] and
non-compliance of the same could affect the sufficiency of the cause of action and make the complaint vulnerable to
dismissal on the ground of lack of cause of action or prematurity (Peregrina vs. Panis, 133 SCRA 75). [1984] It must
be borne in mind that the purpose of the conciliation process at the barangay level is to discourage indiscriminate
filing of cases in court in order to decongest the clogged dockets and in the process enhance the quality of justice
dispensed by courts (Morato, vs. Go, supra).
In the instant case, it will be noted that the ejectment case in the City Court of Davao, Civil Case No. 17-10-D, was
filed on September 18, 1980, when Presidential Decree No. 1508 was already enforced. However, the records do not
show that there was an opposition to the filing of the said ejectment case on the ground that the dispute had not been
submitted to the Barangay Court for possible amicable settlement under P.D. 1508. The only logical conclusion
therefore is that either such requirement had already been complied with or had been waived. Under either
circumstance, there appears to be no reason, much less a requirement that this case be subjected to the provisions of
P.D. 1508. In fact, the present controversy is an action for annulment of a compromise judgment which as a general
rule is immediately executory (De Guzman vs. Court of Appeals, 137 SCRA 730,[1985]), and accordingly, beyond
the authority of the Barangay Court to change or modify. Normally, the instant case should be remanded to the lower
court for further proceedings. Nevertheless, a close examination of the records shows that such time- consuming
procedure may be dispensed with in resolving the issue at hand. Thus, this Court, in the case of Velasco, et al. vs.
Gayapa (G.R. No. 58651, promulgated on July 30,1987), ruled: “Since the main case is manifestly without merit, the
order of the lower court dismissing the appeal cannot be impugned. As held in Castro vs. Court of appeals (supra), "a
remand for further proceedings therefore, would only result in needless delays — a few more yearn perhaps of a
tortuous journey; through new proceedings in the trial court, the intermediate appeal and another resort to this Court
through a petition for review to finally achieve the same result."
2. NO. Petitioner's action for annulment of judgment is based on the ground of extrinsic fraud allegedly committed by
her own lawyer by telling her "that she cannot be elected any more during her lifetime" from the land in dispute, but
did not disclose to her that at the same time she would have to recognize the prior possession of private respondent.
While there can be no question as to the right of any person adversely affected by a judgment to maintain an action
and to have the decision declared a nullity, such an action to annul a judgment upon the ground of fraud, will not lie
unless the fraud be extrinsic or collateral and committed by the adverse party, not by one's own counsel. Said ruling
was reiterated in a subsequent case where it was stressed that the fraud mentioned in Rule 38 is the fraud committed
by the adverse party (Velayo vs. Shell Company of the Philippines, Ltd., et al., 105 Phil. 1114, [1959]). In the instant
case, petitioner, in her action for annulment of judgment, never made any allegation that private respondent had
anything to do with such actuation other lawyer. Such being the case, the most that she has is an action against her
own lawyer and not against the private respondent. Moreover, miscalculation or misappreciation of the legal import
of the compromise agreement, where the party is assisted by counsel, win not provide basis for setting aside agreement
on the ground of mistake or error. A compromise, entered into and carried out in good faith, will not be discarded
even if there was a mistake of law or fact. (Periquet vs. Reyes, 21 SCRA 1503, [1967]).
Vda. De Borromeo v. Pogoy, G.R. No. L-63277, November 29, 1983
DOCTRINE: Conciliation process at the barangay level condition precedent for filing actions in applicable cases
under PD 1508; Failure of complaint to allege compliance with the requirement of referral of case first to the
barangay courts under PD 1508, fatal.
FACTS:
Petitioner herein seeks to stop respondent Judge Julian B. Pogoy of the Municipal Trial Court (MTC) of Cebu City
from taking cognizance of an ejectment suit for failure of the plaintiff to refer the dispute to the Barangay Lupon for
conciliation.
The intestate estate of the late Vito Borromeo is the owner of a building bearing the deceased’s name, located at F.
Ramos St., Cebu City. Said building has been leased and occupied by petitioner Petra Vda. de Borromeo at a monthly
rental of P500.00 payable in advance within the first 5 days of the month.
On August 28, 1982, private respondent Atty. Ricardo Reyes, administrator of the estate and a resident of Cebu City,
served upon petitioner a letter demanding that she pay the overdue rentals corresponding to the period from March to
September 1982, and thereafter to vacate the premises. As petitioner failed to do so, Atty. Reyes instituted on
September 16, 1982 an ejectment case against the former in the MTC of Cebu City. The complaint was docketed as
Civil Case No. R-23915 and assigned to the sala of respondent judge.
On November 12, 1982, petitioner moved to dismiss the case, advancing, among others, the want of jurisdiction of
the trial court. Pointing out that the parties are residents of the same city, as alleged in the complaint, petitioner
contended that the court could not exercise jurisdiction over the case for failure of respondent Atty. Reyes to refer the
dispute to the Barangay Court, as required by PD No. 1508, otherwise known as Katarungang Pambarangay Law.
Respondent judge denied the motion to dismiss. He justified the order in this wise:
"The Clerk of Court when this case was filed accepted for filing same. That from the acceptance from (sic) filing, with
the plaintiff having paid the docket fee to show that the case was docketed in the civil division of this court could be
considered as meeting the requirement or precondition for were it not so, the Clerk of Court would not have accepted
the filing of the case especially that there is a standing circular from the Chief Justice of the Supreme Court without
even mentioning the Letter of Instruction of the President of the Philippines that civil cases and criminal cases with
certain exceptions must not be filed without passing the barangay court."
Unable to secure a reconsideration of said order, petitioner came to this Court through this petition for certiorari. In
both his comment and memorandum, private respondent admitted not having availed himself of the barangay
conciliation process, but justified such omission by citing paragraph 4, section 6 of PD 1508 which allows the direct
filing of an action in court where the same may otherwise be barred by the Statute of Limitations, as applying to the
case at bar.
ISSUE:
Whether or not going through Barangay Conciliation is necessary as a condition precedent in this case
HELD:
No The excuse advanced by private respondent is unsatisfactory. Under Article 1147 of the Civil Code, the period for
filing actions for forcible entry and detainer is one year, and this period is counted from demand to vacate the premises.
In the case at bar, the letter-demand was dated August 28, 1982, while the complaint for ejectment was filed in court
on September 16, 1982. Between these two dates, less than a month had elapsed, thereby leaving at least eleven (11)
full months of the prescriptive period provided for in Article 1147 of the Civil Code. Under the procedure outlined in
Section 4 of PD 1508, 3 the time needed for the conciliation proceeding before the Barangay Chairman and the Pangkat
should take no more than 60 days. Giving private respondent nine (9) months — ample time indeed — within which
to bring his case before the proper court should conciliation efforts fail. Thus, it cannot be truthfully asserted, as private
respondent would want Us to believe, that his case would be barred by the Statute of Limitations if he had to course
his action to the Barangay Lupon.
With certain exceptions, PD 1508 makes the conciliation process at the Barangay level a condition precedent for filing
of actions in those instances where said law applies. For this reason, Circular No. 22 addressed to "ALL JUDGES OF
THE COURTS OF FIRST INSTANCE, CIRCUIT CRIMINAL COURTS, JUVENILE AND DOMESTIC
RELATIONS COURT, COURTS OF AGRARIAN RELATIONS, CITY COURTS, MUNICIPAL COURTS AND
THEIR CLERKS OF COURT" was issued by Chief Justice Enrique M. Fernando on November 9, 1979. Said Circular
reads:
"Effective upon your receipt of the certification by the Minister of Local Government and Community Development
that all the barangays within your respective jurisdictions have organized their Lupons provided for in Presidential
Decree No. 1508, otherwise known as the Katarungang Pambarangay Law, in implementation of the barangay system
of settlement of disputes, you are hereby directed to desist from receiving complaints, petitions, actions or proceedings
in cases falling within the authority of said Lupons."
While respondent acknowledged said Circular in his order of December 14, 1982, he nevertheless chose to overlook
the failure of the complaint in Civil Case No. R-23915 to allege compliance with the requirement of PD 1508. Neither
did he cite any circumstance as would place the suit outside the operation of said law. Instead, he insisted on relying
upon the pro tanto presumption of regularity in the performance by the clerk of court of his official duty, which to Our
mind has been sufficiently overcome by the disclosure by the Clerk of Court that there was no certification to file
action from the Lupon or Pangkat secretary attached to the complaint.
Be that as it may, the instant petition should be dismissed. Under Section 4(a) of PD No. 1508, referral of a dispute to
the Barangay Lupon is required only where the parties thereto are "individuals." An "individual" means "a single
human being as contrasted with a social group or institution." Obviously, the law applies only to cases involving
natural persons, and not where any of the parties is a juridical person such as a corporation, partnership, corporation
sole, testate or intestate, estate, etc.
In Civil Case No. R-23915, plaintiff Ricardo Reyes is a mere nominal party who is suing in behalf of the Intestate
Estate of Vito Borromeo. While it is true that Section 3, Rule 3 of the Rules of Court allows the administrator of an
estate to sue or be sued without joining the party for whose benefit the action is presented or defended, it is indisputable
that the real party in interest in Civil Case No. R-23915 is the intestate estate under administration. Since the said
estate is a juridical person, plaintiff administrator may file the complaint directly in court, without the same being
coursed to the Barangay Lupon for arbitration.
ACCORDINGLY, the petition is hereby dismissed. Respondent judge is ordered to try and decide Civil Case No. R23915 without unnecessary delay. No costs.
Peregrina v. Panis, 133 SCRA 75
DOCTRINE: Thus, Moratavs. Go, 125 SCRA 444 (1983), and Vda. de Borromeo vs. Pogoy, 126 SCRA 217
(1983) have held that P.D. No. 1508 makes the conciliation process at the Barangay level a condition precedent for
the filing of a complaint in Court. Non-compliance with that condition precedent could affect the sufficiency of the
plaintiff’s cause of action and make his complaint vulnerable to dismissal on the ground of lack of cause of action
or prematurity. The condition is analogous to exhaustion of administrative remedies, or the lack of earnest efforts
to compromise suits between family members, lacking which the case can be dismissed.
FACTS:
A complaint was filed by Spouses Procopio and Carmelita Sanchez against the petitioners in a civil action for damages
for alleged disrespect for the dignity, privacy and peace of mind of the spouses under Article 26 of the Civil Code,
and for alleged defamation under Article 33 of the same Code. Admittedly, the parties are actual residents of the same
barangay in Olongapo City. In fact, they are neighbors. Unquestionably, too, no conciliation proceedings were filed
before the Lupon. Thus the complaint filed by the petitioners is silent regarding compliance with the mandatory
requirement, nor does it allege that the dispute falls within the excepted cases.
Lower Court: petitioners moved for the dismissal of the complaint. The spouses filed their opposition holding that
under Section 6(3) of P.D. No. 1508, the parties may go directly to the Courts if the action is coupled with a provisional
remedy such as preliminary attachment. At first, the respondent judge dismissed the Complaint for failure of the
spouses to comply with the pre-condition for amicable settlement under P.D. No. 1508, stating that the application for
a provisional remedy was merely an afterthought.
On motion for reconsideration by the SPOUSES, however, respondent Judge denied the Motion to Dismiss on the
ground that under Rule 57, Section 1 of the Rules of Court, the application for attachment can be made at the
commencement of the action or any time thereafter.
ISSUE:
WON barangay conciliation in this case is a precondition for filing a complaint in the RTC.
HELD: Yes
Section 3 of P.D. No. 1508 specifically provides: Disputes between or among persons actually respectively in the
same barangay shall be brought for amicable settlement before the Lupon of said barangay.
It is also mandated by Section 6 of the same law:
Section 6. Conciliation, pre-condition to filing of complaint. — No complaint, petition, action or proceeding involving
any matter within the authority of the Lupon as provided. in Section 2 hereof shall be filed or instituted in court or any
other government office for adjudication unless there has been a confrontation of the parties before the Lupon
Chairman or the Pangkat and no conciliation or settlement has been reached as certified by the Lupon Secretary or the
Pangkat Secretary, attested by the Lupon or Pangkat Chairman, or unless the settlement has been repudiated.
Morata vs. Go, 125 SCRA 444 (1,,983), and Vda. de Borromeo vs. Pogoy, 126 SCRA 217 (1983) have held that P.D.
No. 1508 makes the conciliation process at the Barangay level a condition precedent for the filing of a complaint in
Court. Non- compliance with that condition precedent could affect the sufficiency of the plaintiff's cause of action and
make his complaint vulnerable to dismissal on the ground of lack of cause of action or prematurity. The condition is
analogous to exhaustion of administrative remedies, or the lack of earnest efforts to compromise suits between family
members, lacking which the case can be dismissed.
The parties herein fall squarely within the ambit of P.D. No. 1508. They are actual residents in the same barangay and
their dispute does not fall under any of the excepted cases. It will have to be held, therefore, that respondent Judge
erred in reconsidering his previous Order of dismissal on the ground that the provisional remedy of attachment was
seasonably filed. Not only was the application for that remedy merely an afterthought to circumvent the law, but also,
fundamentally, a Writ of Attachment is not available in a suit for damages where the amount, including moral
damages, is contingent or unliquidated. Prior referral to the Lupon for conciliation proceedings, therefore, was
indubitably called for.
Librada M. Aquino v. Ernest Aure, G. R. No. 153567, February 18, 2008
DOCTRINE: The barangay justice system was established primarily as a means of easing up the congestion
of cases in the judicial courts; The primordial objective of Presidential Decree No. 1508 is to reduce the number
of court litigations and prevent the deterioration of the quality of justice which has been brought by the indiscriminate
filing of cases in the courts; P.D. No. 1508 is now incorporated in R.A. No. 7160, otherwise known as The
Local Government Code, which took effect on 1 January 1992.
FACTS:
Aure and Es Aure Lending Investors alleged that they acquired the subject property from Spouses Aquino. Aure
alleged that after they paid the spouses, the latter refused to vacate the property. Aure filed a complaint for ejectment
against the spouses in the MeTC in Quezon City. The spouses counter that Aure lacks cause of action because the
latter does not have any legal right over the subject property. They reasoned that Aure did not comply with their MoA.
The MeTC ruled that since the question of ownership was put in issue, the action was converted to a suit which is
incapable of pecuniary estimation which properly rests within the original exclusive jurisdiction of the RTC. The
MeTC also ruled that non-compliance with barangay conciliation process lead to the dismissal of the complaint. On
appeal the RTC affirmed the dismissal of the complaint on the same ground that the dispute was not brought before
the Barangay Council for conciliation before it was filed in court. The Court of Appeals reversed the MeTC and RTC
decisions and remanded the case to the MeTC for further proceedings.
ISSUE:
1) Whether or not non-compliance with the Barangay Conciliation proceedings is a jurisdictional defect that warrants
the dismissal of the complaint.
2) Whether or not the allegation of ownership ousts the MeTC of its jurisdiction over an ejectment case.
HELD:
1) No, the conciliation process is not a jurisdictional requirement, so that non- compliance therewith cannot affect the
jurisdiction which the court has otherwise acquired over the subject matter or over the person of the defendant.
However, non- compliance will not prevent a court from exercising its power of adjudication over the case before it
where the defendants failed to object to such exercise of jurisdiction in their answer and even during the entire
proceedings a quo. In the present case, Aquino cannot be allowed to attack the jurisdiction of the MeTC after having
participated in the proceedings without objecting. By Aquino’s failure to seasonably object to the deficiency in the
complaint, she is deemed to have waived any defect. The issue of non-compliance should be pleaded in the answer.
As provided under Section 1, Rule 9 of the 1997 Rules of Civil Procedure:
Sec. 1. Defenses and objections not pleaded. – Defenses and objections not pleaded either in a motion to dismiss or in
the answer are deemed waived. However, when it appears from the pleadings or the evidence on record that the court
has no jurisdiction over the subject matter, that there is another action pending between the same parties for the same
cause, or that the action is barred by a prior judgment or by statute of limitations, the court shall dismiss the claim.
Rule 15: Sec. 8. Omnibus Motion. - Subject to the provisions of Section 1 of Rule 9, a motion attacking a pleading,
order, judgment, or proceeding shall include all objections then available, and all objections not so included shall be
deemed waived.
2) No, jurisdiction in ejectment cases is determined by the allegations pleaded in the complaint. As long as these
allegations demonstrate a cause of action either for forcible entry or for unlawful detainer, the court acquires
jurisdiction over the subject matter. Rule 70 of the Rules of Court: Section 1. Who may institute proceedings, and
when. – Subject to the provisions of the next succeeding section, a person deprived of the possession of any land or
building by force, intimidation, threat, strategy, or stealth, or a lessor, vendor, vendee, or other person against whom
the possession of any land or building is unlawfully withheld after the expiration or termination of the right to hold
possession, by virtue of any contract, express or implied, or the legal representatives or assigns of any such lessor,
vendor, vendee, or other person may at any time within one (1) year after such unlawful deprivation or withholding
of possession, bring an action in the proper Municipal Trial Court against the person or persons unlawfully withholding
or depriving of possession, or any person or persons claiming under them, for the restitution of such possession,
together with damages and costs. The law provides instead that when 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
Crisanta Alcaraz Miguel v. Jerry D. Montanez, G.R. No. 191336, January 25, 2012
DOCTRINE: An amicable settlement reached at the barangay conciliation proceedings, is binding
between the contracting parties and, upon its perfection, is immediately executory insofar as it is not
contrary to law, good morals, good customs, public order and public policy.
FACTS:
On February 1, 2001, respondent Jerry Montanez (Montanez) secured a loan of (P143,864.00), payable in one (1)
year, or until February 1, 2002, from the petitioner, Crisanta Alcaraz Miguel. The respondent gave as collateral
therefor his house and lot located at Block 39 Lot 39 Phase 3, Palmera Spring, Bagumbong, Caloocan City.
Due to the respondents failure to pay the loan, the petitioner filed a complaint against the respondent before the Lupong
Tagapamayapa of Barangay San Jose, Rodriguez, Rizal. The parties entered into a Kasunduang Pag-aayos wherein
the respondent agreed to pay his loan in installments in the amount of Two Thousand Pesos (P2,000.00) per month,
and in the event the house and lot given as collateral is sold, the respondent would settle the balance of the loan in
full. However, the respondent still failed to pay, and on December 13, 2004, the Lupong Tagapamayapa issued a
certification to file action in court in favor of the petitioner.
On April 7, 2005, the petitioner filed before the Metropolitan Trial Court (MeTC) of Makati City, Branch 66, a
complaint for Collection of Sum of Money. In his Answer with Counterclaim, the respondent raised the defense of
improper venue considering that the petitioner was a resident of Bagumbong, Caloocan City while he lived in San
Mateo, Rizal.
MTC rendered the decision in favor of petitioner. Upon appeal, RTC affirmed. CA granted the petition of the
respondent, reversing and setting aside the judgment made RTC. A new judgment is entered dismissing respondents
complaint for collection of sum of money, without prejudice to her right to file the necessary action to enforce the
Kasunduang Pag-aayos.
The CA went on saying that since the parties entered into a Kasunduang Pag-aayos before the Lupon ng Barangay,
such settlement has the force and effect of a court judgment, which may be enforced by execution within six (6)
months from the date of settlement by the Lupon ng Barangay, or by court action after the lapse of such time.
Considering that more than six (6) months had elapsed from the date of settlement, the CA ruled that the remedy of
the petitioner was to file an action for the execution of the Kasunduang Pag-aayos in court and not for collection of
sum of money. Consequently, the CA deemed it unnecessary to resolve the issue on venue.
ISSUE:
1. Whether or not a complaint for sum of money is the proper remedy for the petitioner, notwithstanding the
Kasunduang Pag-aayos
2. Whether or not the CA should have decided the case on the merits rather than remand the case for the
enforcement of the Kasunduang Pag-aayos
HELD:
1. YES.
Because the respondent failed to comply with the terms of the Kasunduang Pag- aayos, said agreement is deemed
rescinded pursuant to Article 2041 of the New Civil Code and the petitioner can insist on his original demand. Perforce,
the complaint for collection of sum of money is the proper remedy.
The petitioner points out that the cause of action did not arise from the Kasunduang Pag-aayos but on the respondents
breach of the original loan agreement. This Court agrees with the petitioner. It is true that an amicable settlement
reached at the barangay conciliation proceedings, like the Kasunduang Pag-aayos in this case, is binding between the
contracting parties and, upon its perfection, is immediately executory insofar as it is not contrary to law, good morals,
good customs, public order and public policy.
This is in accord with the broad precept of Article 2037 of the Civil Code, viz:
A compromise has upon the parties the effect and authority of res judicata; but there shall be no execution except in
compliance with a judicial compromise.
Being a by-product of mutual concessions and good faith of the parties, an amicable settlement has the force and effect
of res judicata even if not judicially approved.
It must be emphasized, however, that enforcement by execution of the amicable settlement, either under the first or
the second remedy, is only applicable if the contracting parties have not repudiated such settlement within ten (10)
days from the date thereof in accordance with Section 416 of the Local Government Code. If the amicable settlement
is repudiated by one party, either expressly or impliedly, the other party has two options, namely, to enforce the
compromise in accordance with the Local Government Code or Rules of Court as the case may be, or to consider it
rescinded and insist upon his original demand. This is in accord with Article 2041 of the Civil Code, which qualifies
the broad application of Article 2037, viz:
If one of the parties fails or refuses to abide by the compromise, the other party may either enforce the compromise or
regard it as rescinded and insist upon his original demand.
In the case of Leonor v. Sycip, the Supreme Court (SC) had the occasion to explain this provision of law. It ruled that
Article 2041 does not require an action for rescission, and the aggrieved party, by the breach of compromise
agreement, may just consider it already rescinded.
In the instant case, the respondent did not comply with the terms and conditions of the Kasunduang Pag-aayos. Such
non-compliance may be construed as repudiation because it denotes that the respondent did not intend to be bound by
the terms thereof, thereby negating the very purpose for which it was executed.
2. YES.
Considering that the Kasunduang Pag-aayos is deemed rescinded by the non- compliance of the respondent of the
terms thereof, remanding the case to the trial court for the enforcement of said agreement is clearly unwarranted.
WHEREFORE, the petition is GRANTED. The assailed decision of the Court of Appeals is SET ASIDE and the
Decision of the Regional Trial Court, Branch 146, Makati City, dated March 14, 2007 is REINSTATED.
SO ORDERED.