Case Brief: People vs. Tan

G.R. No. 167526 July 26, 2010
DANTE TAN, Respondent

Two separate information were filed against respondent Tan for violation of the Revised Securities Act, when he failed to file with SEC the amount of all BWRC (Best World Resources Corporation) shares of which he is the beneficial owner within 10 days after he became such beneficial owner.

During the trial, petitioner made its formal offer of evidence. RTC admitted the pieces of evidence, but denied admission of all other exhibits. Tan filed Motion for Leave to File Demurrer to Evidence. Petitioner filed its Opposition to which Tan filed a Reply. In the end, RTC issued an order granting Tan’s Demurrer to Evidence.

Petitioner filed a petition before the CA assailing the order of RTC which granted Tan’s motion. CA denied, ruling that the dismissal of a criminal action by the grant of a Demurrer to Evidence is one on the merits and operates as an acquittal, for which reason, the prosecution cannot appeal therefrom as it would place the accused in double jeopardy.

Hence, the appeal.

Whether or not the court erred in granting Tan’s Demurrer to Evidence.


The demurrer to evidence in criminal cases, such as the one at bar, is “filed after the prosecution had rested its case,” and when the same is granted, it calls “for an appreciation of the evidence adduced by the prosecution and its sufficiency to warrant conviction beyond reasonable doubt, resulting in a dismissal of the case on the merits, tantamount to an acquittal of the accused.” Such dismissal of a criminal case by the grant of demurrer to evidence may not be appealed, for to do so would be to place the accused in double jeopardy. The verdict being one of acquittal, the case ends there.

The only instance when double jeopardy will not attach is when the trial court acted with grave abuse of discretion amounting to lack or excess of jurisdiction, which is not present in this case. RTC did not violate petitioner’s right to due process as the petitioner was given more than ample opportunity to present its case which led to grant of Tan’s demurrer. RTC never prevented petitioner from presenting its case. In fact, one of the main reasons for the RTCs decision to grant the demurrer was the absence of evidence to prove the classes of shares that the Best World Resources Corporation stocks were divided into, whether there are preferred shares as well as common shares, or even which type of shares respondent had acquired,

Petitioner argues that the RTC displayed resolute bias when it chose to grant respondents demurrer to evidence notwithstanding that it had filed a Motion to Hold in Abeyance the Resolution of Tan’s Demurrer to Evidence and The Prosecution’s Opposition Thereto. Petitioner contends that instead of acting on the motion, the RTC peremptorily granted Tan’s demurrer to evidence which prevented petitioner from its intention to file a petition to question the orders.

While it would have been ideal for the RTC to hold in abeyance the resolution of the demurrer to evidence, nowhere in the rules, however, is it mandated to do so. Furthermore, even if this Court were to consider the same as an error on the part of the RTC, the same would merely constitute an error of procedure or of judgment and not an error of jurisdiction as persistently argued by petitioner.

As such RTC did not abuse its discretion in the manner it conducted the proceedings of the trial, as well as its grant of respondent’s demurrer to evidence.


Case Brief: Kilusang Mayo Uno Labor Center vs Garcia & LTFRB

G.R. No. 115381 December 23, 1994





In 1990, DOTC Sec. Oscar Orbos issued Memo Circular to LTFRB Chair Remedios Fernando to allow provincial bus to change passenger rates w/in a fare range of 15% above or below the LTFRB official rate for a 1yr. period. This is in line with the liberalization of regulation in the transport sector which the government intends to implement and to make progress towards greater reliance on free market forces.

Fernando respectfully called attention of DOTC Sec. that the Public Service Act requires publication and notice to concerned parties and public hearing. In Dec. 1990, Provincial Bus Operators Assoc. of the Phils. (PBOAP) filed an application for across the board fare rate increase, which was granted by LTFRB. In 1992, then DOTC Sec. Garcia issued a memo to LTFRB suggesting a swift action on adoption of procedures to implement the Department Order & to lay down deregulation policies. Pursuant to LTFRB Guideline, PBOAP, w/o benefit of public hearing announced a 20% fare rate increase.

Petitioner Kilusang Mayo Uno (KMU) opposed the move and filed a petition before LTFRB w/c was denied. Hence the instant petition for certiorari w/ urgent prayer for a TRO, w/c was readily granted by the Supreme Court.


Whether the authority granted by LTFB to provincial buses to set a fare range above existing authorized fare range is unconstitutional and invalid.


The grant of power by LTFRB of its delegated authority is unconstitutional. The doctrine of Potestas delegate non delegari (what has been delegated cannot be delegated) is applicable because a delegated power constitutes not only a right but a duty to be performed by the delegate thru instrumentality of his own judgment. To delegate this power is a negation of the duty in violation of the trust reposed in the delegate mandated to discharge such duty. Also, to give provincial buses the power to charge their fare rates will result to a chaotic state of affairs ad this would leave the riding public at the mercy of transport operators who can increase their rates arbitrarily whenever it pleases or when they deem it necessary.

Case Brief: Edu vs. Ericta

G.R. No. L-32096  October 24, 1970
ROMEO F. EDU, in his capacity as Land Transportation Commissioner, petitioner,
HON. VICENTE G. ERICTA in his capacity as Judge of the Court of First Instance of Rizal, Br. XVIII, Quezon City, and TEDDY C. GALO respondents.



Petitioner Romeo F. Edu, the Land Transportation Commissioner, petitioned the SC to rule squarely on the constitutionality of the Reflector Law in this proceeding for certiorari and prohibition against respondent Judge, the Honorable Vicente G. Ericta of the Court of First Instance of Rizal, Quezon City Branch, to annul and set aside his order for the issuance of a writ of preliminary injunction directed against Administrative Order No. 2 of petitioner for the enforcement of the aforesaid statute, in a pending suit in his court for certiorari and prohibition, filed by the other respondent Teddy C. Galo assailing; the validity of such enactment as well as such administrative order.

Such administrative order, which took effect on April 17, 1970, has a provision on reflectors in effect reproducing what was set forth in the Act. Thus: “No motor vehicles of whatever style, kind, make, class or denomination shall be registered if not equipped with reflectors. Such reflectors shall either be factory built-in-reflector commercial glass reflectors, reflection tape or luminous paint. The luminosity shall have an intensity to be maintained visible and clean at all times such that if struck by a beam of light shall be visible 100 meters away at night.” 35 Then came a section on dimensions, placement and color.

As to dimensions the following is provided for: “Glass reflectors — Not less than 3 inches in diameter or not less than 3 inches square; Reflectorized Tape — At least 3 inches wide and 12 inches long. The painted or taped area may be bigger at the discretion of the vehicle owner.” Provision is then made as to how such reflectors are to be “placed, installed, pasted or painted.”

There is the further requirement that in addition to such reflectors there shall be installed, pasted or painted four reflectors on each side of the motor vehicle parallel to those installed, pasted or painted in front and those in the rear end of the body thereof. The color required of each reflectors, whether built-in, commercial glass, reflectorized tape or reflectorized paint placed in the front part of any motor vehicle shall be amber or yellow and those placed on the sides and in the rear shall all be red.

Penalties resulting from a violation thereof could be imposed. Thus: “Non-compliance with the requirements contained in this Order shall be sufficient cause to refuse registration of the motor vehicle affected and if already registered, its registration maybe suspended in pursuance of the provisions of Section 16 of RA 4136; Provided, however, that in the case of the violation of Section 1 (a) and (b) and paragraph (8) Section 3 hereof, a fine of not less than ten nor more than fifty pesos shall be imposed.

The  respondent Judge denied the motion for reconsideration of the order of injunction.

1.) WON Reflector Law is unconstitutional.
2.) WON A.O No. 2 is invalid and contrary to the principle of non-delegation of legislative power.

NO. both are valid and constitutional.
It is thus obvious that the challenged statute is a legislation enacted under the police power to promote public safety. What is delegated is authority which is non-legislative in character, the completeness of the statute when it leaves the hands of Congress being assumed.

1. Police Power.  It is in the above sense the greatest and most powerful attribute of government. “the most essential, insistent, and at least illimitable of powers,” (Justice Holmes) aptly pointed out “to all the great public needs.”
Its scope, ever-expanding to meet the exigencies of the times, even to anticipate the future where it could be done, provides enough room for an efficient and flexible response to conditions and circumstances thus assuring the greatest benefits. In the language of Justice Cardozo: “Needs that were narrow or parochial in the past may be interwoven in the present with the well-being of the nation.

2. Delegation of Legislative Power. It is a fundamental principle flowing from the doctrine of separation of powers that Congress may not delegate its legislative power to the two other branches of the government, subject to the exception that local governments may over local affairs participate in its exercise. What cannot be delegated is the authority under the Constitution to make laws and to alter and repeal them; the test is the completeness of the statute in all its term and provisions when it leaves the hands of the legislature. To determine whether or not there is an undue delegation of legislative power the inquiry must be directed to the scope and definiteness of the measure enacted. The legislature does not abdicate its functions when it describes what job must be done, who is to do it, and what is the scope of his authority. For a complex economy, that may indeed be the only way in which the legislative process can go forward. A distinction has rightfully been made between delegation of power to make the laws which necessarily involves a discretion as to what it shall be, which constitutionally may not be done, and delegation of authority or discretion as to its execution to exercised under and in pursuance of the law, to which no valid objection call be made. The Constitution is thus not to be regarded as denying the legislature the necessary resources of flexibility and practicability.
To avoid the taint of unlawful delegation, there must be a standard, which implies at the very least that the legislature itself determines matters of principle and lay down fundamental policy. Otherwise, the charge of complete abdication may be hard to repel. A standard thus defines legislative policy, marks its limits, its maps out its boundaries and specifies the public agency to apply it. It indicates the circumstances under which the legislative command is to be effected. It is the criterion by which legislative purpose may be carried out. Thereafter, the executive or administrative office designated may in pursuance of the above guidelines promulgate supplemental rules and regulations.
The standard may be either express or implied. If the former, the non-delegation objection is easily met. The standard though does not have to be spelled out specifically. It could be implied from the policy and purpose of the act considered as a whole. In the Reflector Law, clearly the legislative objective is public safety.

Notes: May a foreign corporation, which is not licensed to do business in the Philippines, sue or be sued before the Philippine courts?


Q: May a foreign corporation, which is not licensed to do business in the Philippines, sue or be sued before the Philippine courts?

Let’s discuss.

First and foremost, Sec. 123 of the Corporation Code defines what a foreign corporation is (although it is not quite accurate). Simply put, a foreign corporation is one formed, organized, and existing under any laws other than those of the Philippines. Jurisprudence has provided for several tests to determine as to whether or not the entity can be considered as “foreign corporation”.

If, however, they want to conduct business in the Philippines, they have to secure a license from the Securities and Exchange Commission (SEC). The subsequent provisions of the Corporation Code indicate how it is done. It bears noting that several statutory requirements must be complied with before they can conduct business in our country, such as the required number of shares belonging to foreigner/Filipinos, appointment of resident agents, and the likes. The salient laws include RA 7042 (Foreign Investments Act), RA 8762 (Retail Trade Liberalization Act), EO 184 (Tenth Foreign Negative Investment List), and BP 68 (Corporation Code). Even the 1987 Constitution and Omnibus Investments Code may come in handy.

After complying with the requirements, SEC will then issue a license to such corporation and it can start transacting business in the Philippines from there. It is worthy to mention that the license does not really serve to bar a foreign corporation from performing isolated or single acts. Its purpose is really to make it amenable to suits in the Philippine courts. Otherwise stated, the grant of license allows the foreign corporation to sue and be sued before the Philippine tribunals.

Now, what would happen if the foreign corporation transacts business in the Philippines without a license?

First, its officers may be penalized under Sec. 144 of the Corporation Code, which provides for imprisonment (30 days to 5 years) and payment of fine.

Moreover, it cannot sue before the Philippine courts, but it can be sued for any causes of action arising from any sources of obligation. In plain view, as far as the judicial flow is concerned, a corporation which stands as an aggrieved party gets the short end of the stick because in the grand scheme of things, it cannot claim. As amply stated by the Supreme Court in the case of Universal Shipping vs. IAC, “It is not the lack of required license but doing business without a license which bars a foreign corporation from access to our courts”.

Are there exceptions to the general rule that a foreign corporation, which has no license, can sue before the Philippine courts?

Yes. In some decisions, the Supreme Court allowed a foreign corporation without a license to sue and file a claim before our domestic courts. To enumerate:

– Cases of isolated transactions with other entities, even if it is done pursuant to the usual business of the corporation. The cases of Western Supply vs. Reyes and Facilities Management vs. Dela Rosa are on point. In line with this, the phrase “doing business” is defined in Sec. 3 of the Foreign Investment Act.
– To protect its trademark, tradename, corporate name, reputation, or goodwill; even in cases of unfair competition. The discussion in the case of Fredco Manufacturing vs. Harvard comes into play. Moreover, it bears noting that the Philippines, along with other States, is a signatory to the Paris Convention which allows such foreign corporations to file a claim here for the protection of their intellectual property rights, without the need of applying for a license.  This explains why in such case, Harvard was able to file a complaint for trademark infringement against Fredco in our domestic courts.
– It is merely defending a suit against it, such as cases of defamation and, as stated earlier, unfair competition. You may refer to the case of Time Inc. vs. Reyes.  The Revised Penal Code may also apply.
– In cases of estoppel, where a party transacted with such corporation knowing fully well of the latter’s lack of capability to conduct business, as mentioned in Rimbunan Hijau vs. Oriental Wood.


Disclaimer: The author merely published his notes from the classroom discussions and recitations. He does not guarantee the full accuracy of the data. If you see any wrong information, please tell and the author will be more than happy to correct it. After all, “false knowledge is more dangerous that outright ignorance”. 

Notes: Nell Doctrine (in relation to Corporation’s Power to Sell or Dispose its Assets)


The 2017 Commercial Law Bar Examination made mention of this:

Under the Nell Doctrine, so called because it was first pronounced by the Supreme Court in the 1965 ruling in Nell v. Pacific Farms, Inc. (15 SCRA 415), the general rule is that where one corporation sells or otherwise transfers all of its assets to another corporation, the latter is not liable for the debts and liabilities of the transferor.

State the exceptions to the Nell Doctrine. (4%)

The answer, as provided by the Supreme Court in such case, is:

Generally where one corporation sells or otherwise transfers all of its assets to another corporation, the latter is not liable for the debts and liabilities of the transferor, except: (1) where the purchaser expressly or impliedly agrees to assume such debts; (2) where the transaction amounts to a consolidation or merger of the corporations; (3) where the purchasing corporation is merely a continuation of the selling corporation; and (4) where the transaction is entered into fraudulently in order to escape liability for such debts.

Background of the case:

Nell Co. filed a civil case against Insular Farms, Inc. for a sum of money plus interest, attorney’s fees, and costs. A writ of execution was issued by the court, but was returned unsatisfied, stating that Insular Farms had no leviable property. Thereafter, Nell Co. filed another action against Pacific Farms, Inc. for the collection of the same amount, upon the theory that the latter is the alter ego of Insular Farms. Nell Co. supported its claim by alleging that Pacific Farms had purchased all or substantially all of the shares, as well as the real and personal properties, of Insular Farms.

The record shows that, on March 21, 1958, Pacific Farms purchased 1,000 shares of stock of Insular Farms for P285,126.99; that, thereupon, Pacific Farms sold said shares of stock to certain individuals, who forthwith reorganized said corporation; and that the board of directors thereof, as reorganized, then caused its assets, including its leasehold rights over a public land in Bolinao, Pangasinan, to be sold to Pacific Farms for P10,000.00.

The Supreme Court held that such facts do not prove that Pacific Farms is the alter ego of Insular Farms. There was neither proof nor allegation that Pacific Farms had expressly or impliedly agreed to assume the debt of Insular Farms, or that the Pacific Farms was a continuation of Insular Farms, or that the sale of either the shares of stock or the assets of Insular Farms to the Pacific Farms had been entered into fraudulently, in order to escape liability for the debt of the Insular Farms.

In fact, such sales took place months before the rendition of the judgment in the previous case, and a month before the filing of the present case.  Moreover, Pacific Farms purchased the shares as the highest bidder at an auction sale held at the instance of the bank, to which the shares were originally pledged as a security for an obligation of Insular Farms.

Neither was it claimed that these transactions have resulted in the consolidation or merger of the Insular Farms and Pacific Farms.  On the contrary, Nell Co’s theory to the effect that Pacific Farms was an alter ego of the Insular Farms negated such consolidation or merger, for a corporation cannot be its own alter ego.

The case is generally related to the power of a corporation to sell or dispose its assets, as provided in Sec. 40 of the Corporation Code.  In essence, it can be also related with the Doctrine of Piercing of Corporate Veil.

A.M. No. 01-2-04-SC: Proposed Interim Rules of Procedure Governing Intra-Corporate Controversies Under R.A. No. 8799

Republic of the Philippines


A.M. No. 01-2-04-SC             March 13, 2001





SECTION 1. (a) Cases covered. – These Rules shall govern the procedure to be observed in civil cases involving the following:

    1. Devices or schemes employed by, or any act of, the board of directors, business associates, officers or partners, amounting to fraud or misrepresentation which may be detrimental to the interest of the public and/or of the stockholders, partners, or members of any corporation, partnership, or association;
    2. Controversies arising out of intra-corporate, partnership, or association relations, between and among stockholders, members, or associates; and between, any or all of them and the corporation, partnership, or association of which they are stockholders, members, or associates, respectively;
    3. Controversies in the election or appointment of directors, trustees, officers, or managers of corporations, partnerships, or associations;
    4. Derivative suits; and
    5. Inspection of corporate books.

(b) prohibition against nuisance and harassment suits. – Nuisance and harassment suits are prohibited. In determining whether a suit is a nuisance or harassment suit, the court shall consider, among others, the following:

    1. The extent of the shareholding or interest of the initiating stockholder or member;
    2. Subject matter of the suit;
    3. Legal and factual basis of the complaint;
    4. Availability of appraisal rights for the act or acts complained of; and
    5. Prejudice or damage to the corporation, partnership, or association in relation to the relief sought.

In case of nuisance or harassment suits, the court may, moto proprio or upon motion, forthwith dismiss the case.

SEC. 2. Suppletory application of the Rules of Court. – The Rules of Court, in so far as they may be applicable and are not inconsistent with these Rules, are hereby adopted to form an integral part of these Rules.

SEC. 3. Construction. – These Rules shall be liberally construed in order to promote their objective of securing a just, summary, speedy and inexpensive determination of every action or proceeding.

SEC. 4. Executory nature of decisions and orders. – All decisions and orders issued under these Rules shall immediately be executory. No appeal or petition taken therefrom shall stay the enforcement or implementation of the decision or order, unless restrained by an appellate court. Interlocutory orders shall not be subject to appeal.

SEC. 5. Venue. – All actions covered by these Rules shall be commenced and tried in the Regional Trial Court which has jurisdiction over the principal office of the corporation, partnership, or association concerned. Where the principal office of the corporation, partnership or association is registered in the Securities and Exchange Commission as Metro Manila, the action must be filed in the city or municipality where the head office is located.

SEC. 6. Service of pleadings. – When so authorized by the court, any pleading and/or document required by these Rules may be filed with the court and/or served upon the other parties by facsimile transmission (tax) or electronic mail (e-mail. In such cases, the date of transmission shall be deemed to be prima facie the date of service.

SEC. 7. Signing of pleadings, motions and other papers. – Every pleading, motion, and other paper of a party represented by an attorney shall be signed by at least one attorney of record in the attorney’s individual name, whose address shall be stated. A party who is not represented by an attorney shall sign the pleading, motion, or other paper and state his address.

The signature of an attorney or party constitutes a certification by the signer that he has read the pleading, motion, or other paper; that to the best of his knowledge, information, and belief formed after reasonable inquiry, it is well grounded in fact and is warranted by existing law or a good faith argument for the extension, modification, or reversal of existing jurisprudence; and that it is not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation.

If a pleading, motion, or other paper is not signed, it shall be stricken off the record unless it is promptly signed by the pleader or movant, after he is notified of the omission.

SEC. 8. Prohibited pleadings. – The following pleadings are prohibited:

    1. Motion to dismiss;
    2. Motion for a bill of particulars;
    3. Motion for new trial, or for reconsideration of judgment or order, or for re-opening of trial;
    4. Motion for extension of time to file pleadings, affidavits or any other paper, except those filed due to clearly compelling reasons. Such motion must be verified and under oath; and
    5. Motion for postponement and other motions of similar intent, except those filed due to clearly compelling reasons. Such motion must be verified and under oath.

SEC. 9. Assignment of cases. – All cases filed under these Rules shall be tried by judges designated by the Supreme Court to hear and decide cases transferred from the Securities and Exchange Commission to the Regional Trial Courts and filed directly with said courts pursuant to Republic Act No. 8799, otherwise known as the Securities and Regulation Cod


SECTION 1. Commencement of action. – An action under these Rules is commenced by the filing of a verified complaint with the proper Regional Trial Court.

SEC. 2. Pleadings allowed. – The only pleadings allowed to be filed under these Rules are the complaint, answer, compulsory counterclaims or cross-claims pleaded in the answer, and the answer to the counterclaims or cross-claims.

SEC. 3. Verification. The complaint and the answer shall be verified by an affidavit stating that the affiant has read the pleading and the allegations therein are true and correct based on his own personal knowledge or on authentic records.

SEC. 4. Complaint. – The complaint shall state or contain:

    1. the names, addresses, and other relevant personal or juridical circumstances of the parties;
    2. all facts material and relevant to the plaintiff’s cause or causes of action, which shall be supported by affidavits of the plaintiff or his witnesses and copies of documentary and other evidence supportive of such cause or causes of action;
    3. the law, rule, or regulation relied upon, violated, or sought to be enforced;
    4. a certification that (a) the plaintiff has not theretofore commenced any action or filed any claim involving the same issues in any court, tribunal or quasi-judicial agency, and, to the best of his knowledge, no such other action or claim is pending therein; (b) if there is such other action or claim, a complete statement of the present status thereof; and (c) if he should thereafter learn that the same or similar action or claim has been filed or is pending, he shall report that fact within five (5) days therefrom to the court; and
    5. the relief sought.

SEC. 5. Summons. – The summons and the complaint shall be served together not later than five (5) days from the date of filing of the complaint.

    1. Service upon domestic private juridical entities. – If the defendant is a domestic corporation, service shall be deemed adequate if made upon any of the statutory or corporate officers as fixed by the by-laws or their respective secretaries. If the defendant is a partnership, service shall be deemed adequate if made upon any of the managing or general partners or upon their respective secretaries. If the defendant is an association, service shall be deemed adequate if made upon any of its officers or their respective secretaries.
    2. Service upon foreign private juridical entity. When the defendant is a foreign private juridical entity which is transacting or has transacted business in the Philippines, service may be made on its resident agent designated in accordance with law for that purpose, or, if there be no such agent, on the government official designated by law to that effect, or on any of its officers or agents within the Philippines.

SEC. 6. Answer. – The defendant shall file his answer to the complaint, serving a copy thereof on the plaintiff, within fifteen (15) days from service of summons.

In the answer, the defendant shall:

    1. Specify each material allegation of fact the truth of which he admits;
    2. Specify each material allegation of fact the truth of which he does not admit. Where the defendant desires to deny only a part of an averment, he shall specify so much of it as true and material and shall deny only the remainder;
    3. Specify each material allegation of fact as to which truth he has no knowledge or information sufficient to form a belief, and this shall have the effect of a denial;
    4. State the defenses, including grounds for a motion to dismiss under the Rules of Court;
    5. State the law, rule, or regulation relied upon;
    6. Address each of the causes of action stated in the complaint;
    7. State the facts upon which he relies for his defense, including affidavits of witnesses and copies of documentary and other evidence supportive of such cause or causes of action;
    8. State any compulsory counterclaim/s and cross-claim/s; and
    9. State the relief sought.

The answer to counterclaims or cross-claims shall be filed within ten (10) days from service of the answer in which they are pleaded.

SEC. 7. Effect of failure to answer. – If the defendant fails to answer within the period above provided, he shall be considered in default. Upon motion or motu proprio, the court shall render judgment either dismissing the complaint or granting the relief prayed for as the records may warrant. In no case shall the court award a relief beyond or different from that prayed for.

SEC. 8. Affidavits, documentary and other evidence. – Affidavits shall be based on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify on the matters stated therein. The affidavits shall be in question and answer form, and shall comply with the rules on admissibility of evidence.

Affidavits of witnesses as well as documentary and other evidence shall be attached to the appropriate pleading; Provided, however, that affidavits, documentary and other evidence not so submitted may be attached to the pre-trial brief required under these Rules. Affidavits and other evidence not so submitted shall not be admitted in evidence, except in the following cases:

    1. Testimony of unwilling, hostile, or adverse party witnesses. A witness is presumed prima facie hostile if he fails or refuses to execute an affidavit after a written request therefor;
    2. If the failure to submit the evidence is for meritorious and compelling reasons; and
    3. Newly discovered evidence.

In case of (2) and (3) above, the affidavit and evidence must be submitted not later than five (5) days prior to its introduction in evidence.


SECTION 1. In general.A party can only avail of any of the modes of discovery not later than fifteen (15) days from the joinder of issues.

SEC. 2. Objections. – Any mode of discovery such as interrogatories, request for admission, production or inspection of documents or things, may be objected to within ten (10) days from receipt of the discovery device and only on the ground that the matter requested is patently incompetent, immaterial, irrelevant or privileged in nature.

The court shall rule on the objections not later than fifteen (15) days from the filing thereof.

SEC. 3. Compliance. – Compliance with any mode of discovery shall be made within ten (10) days from receipt of the discovery device, or if there are objections, from receipt of the ruling of the court.

SEC. 4. Sanctions. – The sanctions prescribed in the Rules of Court for failure to avail of, or refusal to comply with, the modes of discovery shall apply. In addition, the court may, upon motion, declare a party non-suited or as in default, as the case may be, if the refusal to comply with a mode of discovery is patently unjustified.


SECTION 1. Pre-trial conference; mandatory nature. – Within five (5) days after the period for availment of, and compliance with, the modes of discovery prescribed in Rule 3 hereof, whichever comes later, the court shall issue and serve an order immediately setting the case for pre-trial conference and directing the parties to submit their respective pre-trial briefs. The parties shall file with the court and furnish each other copies of their respective pre-trial brief in such manner as to ensure its receipt by the court and the other party at least five (5) days before the date set for the pre-trial.

The parties shall set forth in their pre-trial briefs, among other matters, the following:

    1. Brief statement of the nature of the case, which shall summarize the theory or theories of the party in clear and concise language;
    2. Allegations expressly admitted by either or both parties;
    3. Allegations deemed admitted by either or both parties;
    4. Documents not specifically denied under oath by either or both parties;
    5. Amendments to the pleadings;
    6. Statement of the issues, which shall separately summarize the factual and legal issues involved in the case;
    7. Names of witnesses to be presented and the summary of their testimony as contained in their affidavits supporting their positions on each of the issues;
    8. All other pieces of evidence, whether documentary or otherwise and their respective purposes;
    9. Specific proposals for an amicable settlement;
    10. Possibility of referral to mediation or other alternative modes of dispute resolution;
    11. Proposed schedule of hearings; and
    12. Such other matters as may aid in the just and speedy disposition of the case.

SEC. 2. Nature and purpose of pre-trial conference. – During the pre-trial conference, the court shall, with its active participation, ensure that the parties consider in detail all of the following:

    1. The possibility of an amicable settlement;
    2. Referral of the dispute to mediation or other forms of dispute resolution;
    3. Facts that need not be proven, either because they are matters of judicial notice or expressly or deemed admitted;
    4. Amendments to the pleadings;
    5. The possibility of obtaining stipulations and admissions of facts and documents;
    6. Objections to the admissibility of testimonial, documentary and other evidence;
    7. Objections to the form or substance of any affidavit, or part thereof;
    8. Simplification of the issues;
    9. The possibility of submitting the case for decision on the basis of position papers, affidavits, documentary and real evidence;
    10. A complete schedule of hearing dates; and
    11. Such other matters as may aid in the speedy and summary disposition of the case.

SEC. 3. Termination. – The preliminary conference shall be terminated not later than ten (10) days after its commencement, whether or not the parties have agreed to settle amicably.

SEC. 4. Judgment before pre-trial. – If, after submission of the pre-trial briefs, the court determines that, upon consideration of the pleadings, the affidavits and other evidence submitted by the parties, a judgment may be rendered, the court may order the parties to file simultaneously their respective memoranda within a non-extendible period of twenty (20) days from receipt of the order. Thereafter, the court shall render judgment, either full or otherwise, not later than ninety (90) days from the expiration of the period to file the memoranda.

SEC. 5. Pre-trial order; judgment after pre-trial. – The proceedings in the pre-trial shall be recorded. Within ten (10) days after the termination of the pre-trial, the court shall issue an order which shall recite in detail the matters taken up in the conference, the actions taken thereon, the amendments allowed in the pleadings, and the agreements or admissions made by the parties as to any of the matters considered. The court shall rule on all objections to or comments on the admissibility of any documentary or other evidence, including any affidavit or any part thereof. Should the action proceed to trial, the order shall explicitly define and limit the issues to be tried and shall strictly follow the form set forth in Annex “A” of these Rules.

The contents of the order shall control the subsequent course of the action, unless modified before trial to prevent manifest injustice.

After the pre-trial, the court may render judgment, either full or partial, as the evidence presented during the pre-trial may warrant.


SECTION 1. Witnesses. – If the court deems necessary to hold hearings to determine specific factual matters before rendering judgment, it shall, in the pre-trial order, set the case for trial on the dates agreed upon by the parties.

Only persons whose affidavits were submitted may be presented as witnesses, except in cases specified in section 8, Rule 2 of these Rules. The affidavits of the witnesses shall serve as their direct testimonies, subject to cross-examination in accordance with existing rules on evidence.

SEC. 2. Trial schedule. – Unless judgment is rendered pursuant to Rule 4 of these Rules, the initial hearing shall be held not later than thirty (30) days from the date of the pre-trial order. The hearings shall be completed not later than sixty (60) days from the date of the initial hearing, thirty (30) days of which shall be allotted to the plaintiffs and thirty (30) days to the defendants in the manner prescribed in the rep-trial order. The failure of a party to present a witness on a scheduled hearing date shall be deemed a waiver of such hearing date. However, a party may present such witness or witnesses within his remaining allotted hearing dates.

SEC. 3. Written offer of evidence. – Evidence not otherwise admitted by the parties or ruled upon by the court during the pre-trial conference shall be offered in writing not later than five (5) days from the completion of the presentation of evidence of the party concerned. The opposing party shall have five (5) days from receipt of the offer to file his comments or objections. The court shall make its ruling on the offer within five (5) days from the expiration of the period to file comments or objections.

SEC. 4. Memoranda. – Immediately after ruling on the last offer of evidence, the court shall order the parties to simultaneously file, within thirty (30) days from receipt of the order, their respective memoranda. The memoranda shall contain the following:

    1. A “Statement of the Case,” which is a clear and concise statement of the nature of the action and a summary of the proceedings;
    2. A “Statement of the Facts,” which is a clear and concise statement in narrative form of the established facts, with reference to the testimonial, documentary or other evidence in support thereof;
    3. A “Statement of the issues,” which is a clear and concise statement of the issues presented to the court for resolution;
    4. The “Arguments,” which is a clear and concise presentation of the argument in support of each issue; and
    5. The “Relief,” which is a specification of the order or judgment which the party seeks to obtain.

No reply memorandum shall be allowed.

SEC. 5. Decision after trial. – The court shall render a decision not later than (90) days from the lapse of the period to file the memoranda, with or without said pleading having been filed.



SECTION 1. Cases covered. – The provisions of this rule shall apply to election contests in stock and non-stock corporations.

SEC. 2. Definition. – An election contest refers to any controversy or dispute involving title or claim to any elective office in a stock or non-stock corporation, the validation of proxies, the manner and validity of elections, and the qualifications of candidates, including the proclamation of winners, to the office of director, trustee or other officer directly elected by the stockholders in a close corporation or by members of a non-stock corporation where the articles of incorporation or by-laws so provide.

SEC. 3. Complaint. – In addition to the requirements in section 4, Rule 2 of these Rules, the complaint in an election contest must state the following:

    1. The case was filed within fifteen (15) days from the date of the election if the by-laws of the corporation do not provide for a procedure for resolution of the controversy, or within fifteen (15) days from the resolution of the controversy by the corporation as provided in its by-laws; and
    2. The plaintiff has exhausted all intra-corporate remedies in election cases as provided for in the by-laws of the corporation.

SEC. 4. Duty of the court upon the filing of the complaint. – Within two (2) days from the filing of the complaint, the court, upon a consideration of the allegations thereof, may dismiss the complaint outright if it is not sufficient in form and substance, or, if it is sufficient, order the issuance of summons which shall be served, together with a copy of the complaint, on the defendant within two (2) days from its issuance.

SEC. 5. Answer. – The defendant shall file his answer to the complaint, serving a copy thereof on the plaintiff, within ten (10) days from service of summons and the complaint. The answer shall contain the matters required in section 6, Rule 2 of these Rules.

SEC. 6. Affidavits, documentary and other evidence. – The parties shall attach to the complaint and answer the affidavits of witnesses, documentary and other evidence in support thereof, if any.


Acting on the Memorandum of the Committee on SEC Cases submitting for this Court’s consideration and approval the Proposed Interim Rules of Procedure for Intra-Corporate Controversies, the Court Resolved to APPROVE the same.

The Interim Rules shall take effect on April 1, 2001 following its publication in two (2) newspapers of general circulation.

March 13, 2001, Manila.

Case Brief: Fenequito v Vergara

July 18, 2012






On February 11, 2004, an information for falsification of public documents was filed with the Metropolitan Trial Court (MeTC) of Manila by the Assistant City Prosecutor of Manila (representing Bernardo Vergara Jr.) against Rosa Fenequito, Corazon E. Hernandez, and Lauro H. Rodriquez. On April 23, 2004, Fenequito, et al. filed a Motion to Dismiss the Case Based on Absence of Probable Cause. The MeTC issued an order granting the said motion. Upon appeal by the public prosecutor, however, the RTC set aside the MeTC’s order and directed the latter to trial. Fenequito, et al, filed an appeal before the CA, which subsequent ruled that the RTC’s assailed decision was interlocutory in nature and was therefore not appealable. Hence, the instant petition for review.


WON RTC’s decision was interlocutory and can be appealed.


RTC’s decision was interlocutory in nature.  As such, it cannot be appealed.

One of the grounds for the CA’s outright dismissal of Fenequito et al.’s petition for review was because of the latter’s failure to submit copies of pleadings and documents relevant and pertinent to the petition filed, as required under Section 2, Rule 42 of the Rules of Court.

It is settled rule that the right to appeal is neither a natural right nor a part of due process; it is merely a statutory privilege, and may be exercised only in the manner and in accordance with the provisions of law. An appeal being a purely statutory right, an appealing party must strictly comply with the requisites laid down in the Rules of Court. The rationale for this strict attitude is not difficult to appreciate as the Rules are designed to facilities the orderly disposition of appealed cases.

But even if the Court bends its Rules to allow the present petition, the Court still finds no cogent reason to depart from the assailed ruling of the CA. This is because Fenequito et al. erroneously assumed that the RTC Decision is final and appealable, when in fact it is interlocutory. An order is interlocutory if it does not dispose of a case completely, but leaves something more to be done upon its merits. In contrast, a final order is one that which dispose of the whole subject matter or terminates a particular proceeding or action, leaving nothing to be done but to enforce by execution what has been determined.

Granted, the assailed Decision of the RTC set aside the Order of the MeTC and directed the court a quo to proceed to trial by allowing the prosecution to present its evidence. Hence, it is clear that the RTC Decision is interlocutory as it did not dispose of the case completely, but left something more to be done on its merits.