remcases2

KAZUHIRO HASEGAWA and NIPPON ENGINEERING CONSULTANTS CO., LTD., vs MINORU KITAMURA,Hasegawa vs. Kitamura, G.R. No. 149177 November 23, 2007

DECISIONNACHURA,J.:Before the Court is a petition for review oncertiorariunder Rule 45 of the Rules of Court assailing the April 18, 2001 Decision[1]of the Court of Appeals (CA) in CA-G.R. SP No. 60827, and the July 25, 2001 Resolution[2]denying the motion for reconsideration thereof.On March 30, 1999, petitioner Nippon Engineering Consultants Co., Ltd. (Nippon), a Japanese consultancy firm providing technical and management support in the infrastructure projects of foreign governments,[3]entered into an Independent Contractor Agreement (ICA) with respondent Minoru Kitamura, a Japanese national permanently residing in the Philippines.[4]The agreement provides that respondent was to extend professional services toNipponfor a year starting onApril 1, 1999.[5]Nipponthen assigned respondent to work as the project manager of the Southern Tagalog Access Road (STAR) Project in thePhilippines, following the company's consultancy contract with the Philippine Government.[6]When the STAR Project was near completion, the Department of Public Works and Highways (DPWH) engaged the consultancy services ofNippon, onJanuary 28, 2000, this time for the detailed engineering and construction supervision of the Bongabon-Baler Road Improvement (BBRI) Project.[7]Respondent was named as the project manager in the contract's Appendix 3.1.[8]OnFebruary 28, 2000, petitioner Kazuhiro Hasegawa,Nippon's general manager for its International Division, informed respondent that the company had no more intention of automatically renewing hisICA. His services would be engaged by the company only up to the substantial completion of the STAR Project onMarch 31, 2000, just in time for theICA's expiry.[9]Threatened with impending unemployment, respondent, through his lawyer, requested a negotiation conference and demanded that he be assigned to the BBRI project.Nipponinsisted that respondents contract was for a fixed term that had already expired, and refused to negotiate for the renewal of theICA.[10]As he was not able to generate a positive response from the petitioners, respondent consequently initiated onJune 1, 2000Civil Case No. 00-0264 for specific performance and damages with theRegionalTrialCourtofLipaCity.[11]For their part, petitioners, contending that theICAhad been perfected inJapanand executed by and between Japanese nationals, moved to dismiss the complaint for lack of jurisdiction. They asserted that the claim for improper pre-termination of respondent'sICAcould only be heard and ventilated in the proper courts ofJapanfollowing the principles oflex loci celebrationisandlex contractus.[12]In the meantime, onJune 20, 2000, the DPWH approvedNippon's request for the replacement of Kitamura by a certain Y. Kotake as project manager of the BBRI Project.[13]OnJune 29, 2000, the RTC, invoking our ruling inInsular Government v. Frank[14]that matters connected with the performance of contracts are regulated by the law prevailing at the place of performance,[15]denied the motion to dismiss.[16]The trial court subsequently denied petitioners' motion for reconsideration,[17]prompting them to file with the appellate court, onAugust 14, 2000, theirfirstPetition forCertiorariunder Rule 65 [docketed as CA-G.R. SP No. 60205].[18]OnAugust 23, 2000, the CA resolved to dismiss the petition on procedural groundsfor lack of statement of material dates and for insufficient verification and certification against forum shopping.[19]An Entry of Judgment was later issued by the appellate court onSeptember 20, 2000.[20]Aggrieved by this development, petitioners filed with the CA, onSeptember 19, 2000, still within the reglementary period, asecondPetition forCertiorariunder Rule 65 already stating therein the material dates and attaching thereto the proper verification and certification. This second petition, which substantially raised the same issues as those in the first, was docketed as CA-G.R. SP No.60827.[21]Ruling on the merits of the second petition, the appellate court rendered the assailedApril 18, 2001Decision[22]finding no grave abuse of discretion in the trial court's denial of the motion to dismiss. The CA ruled, among others, that the principle oflex loci celebrationiswas not applicable to the case, because nowhere in the pleadings was the validity of the written agreement put in issue. The CA thus declared that the trial court was correct in applying instead the principle oflex loci solutionis.[23]Petitioners' motion for reconsideration was subsequently denied by the CA in the assailedJuly 25, 2001Resolution.[24]Remaining steadfast in their stance despite the series of denials, petitioners instituted the instant Petition for Review onCertiorari[25]imputing the following errors to the appellate court:A.THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN FINDING THAT THE TRIAL COURT VALIDLY EXERCISED JURISDICTION OVER THE INSTANT CONTROVERSY, DESPITE THE FACT THAT THE CONTRACT SUBJECT MATTER OF THE PROCEEDINGSA QUOWAS ENTERED INTO BY AND BETWEEN TWO JAPANESE NATIONALS, WRITTEN WHOLLY IN THE JAPANESE LANGUAGE AND EXECUTED IN TOKYO, JAPAN.B.THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN OVERLOOKING THE NEED TO REVIEW OUR ADHERENCE TO THE PRINCIPLE OFLEX LOCI SOLUTIONISIN THE LIGHT OF RECENT DEVELOPMENT[S] IN PRIVATE INTERNATIONAL LAWS.[26]The pivotal question that this Court is called upon to resolve is whether the subject matter jurisdiction of Philippine courts in civil cases for specific performance and damages involving contracts executed outside the country by foreign nationals may be assailed on the principles oflex loci celebrationis,lex contractus, the state of the most significant relationship rule, orforum non conveniens.However, before ruling on this issue, we must first dispose of the procedural matters raised by the respondent.Kitamura contends that the finality of the appellate court's decision in CA-G.R. SP No. 60205 has already barred the filing of the second petition docketed as CA-G.R. SP No. 60827 (fundamentally raising the same issues as those in the first one) and the instant petition for review thereof.We do not agree. When the CA dismissed CA-G.R. SP No. 60205 on account of the petition's defective certification of non-forum shopping, it was a dismissal without prejudice.[27]The same holds true in the CA's dismissal of the said case due to defects in the formal requirement of verification[28]and in the other requirement in Rule 46 of the Rules of Court on the statement of the material dates.[29]The dismissal being without prejudice, petitioners can re-file the petition, or file a second petition attaching thereto the appropriate verification and certificationas they, in fact didand stating therein the material dates, within the prescribed period[30]in Section 4, Rule 65 of the said Rules.[31]Thedismissal of a casewithoutprejudice signifies the absence of a decision on the merits and leaves the parties free to litigate the matter in a subsequent action as though the dismissed action had not been commenced.In other words, the termination of a case not on the merits does not bar another action involving the same parties, on the same subject matter and theory.[32]Necessarily, because the said dismissal is without prejudice and has nores judicataeffect, and even if petitioners still indicated in the verification and certification of the secondcertioraripetitionthat the first had already been dismissed on procedural grounds,[33]petitioners are no longer required by the Rules to indicate in their certification of non-forum shoppingin the instant petition for review of the second certiorari petition, the status of the aforesaid first petition before the CA. In any case, an omission in the certificate of non-forum shopping about any event that will not constituteresjudicataandlitispendentia,as in the present case, is not a fatal defect.It will not warrant thedismissal and nullification of the entire proceedings, considering that the evils sought to be prevented by the said certificate are no longer present.[34]The Court also finds no merit in respondent's contention that petitioner Hasegawa is only authorized to verify and certify, on behalf ofNippon, thecertioraripetition filed with the CA and not the instant petition. True, the Authorization[35]dated September 4, 2000, which is attached to the secondcertioraripetition and which is also attached to the instant petition for review, is limited in scopeits wordings indicate that Hasegawa is given the authority to sign for and act on behalf of the company only in the petition filed with the appellate court, and that authority cannot extend to the instant petition for review.[36]In a plethora of cases, however, this Court has liberally applied the Rules or even suspended its application whenever a satisfactory explanation and a subsequent fulfillment of the requirements have been made.[37]Given that petitioners herein sufficiently explained their misgivings on this point and appended to their Reply[38]an updated Authorization[39]for Hasegawa to act on behalf of the company in the instant petition, the Court finds the same as sufficient compliance with the Rules.However, the Court cannot extend the same liberal treatment to the defect in the verification and certification. As respondent pointed out, and to which we agree, Hasegawa is truly not authorized to act on behalf ofNipponin this case. The aforesaid September 4, 2000 Authorization and even the subsequent August 17, 2001 Authorization were issued only by Nippon's president and chief executive officer, not by the company's board of directors. In not a few cases, we have ruled that corporate powers are exercised by the board of directors; thus, no person, not even its officers, can bind thecorporation, in the absence of authority from the board.[40]Considering that Hasegawa verified and certified the petition only on his behalf and not on behalf of the other petitioner, the petition has to be denied pursuant toLoquias v. Office of the Ombudsman.[41]Substantial compliance will not suffice in a matter that demands strict observance of the Rules.[42]While technical rules of procedure are designed not to frustrate the ends of justice, nonetheless, they are intended to effect the proper and orderly disposition of cases and effectively prevent the clogging of court dockets.[43]Further, the Court has observed that petitioners incorrectly filed a Rule 65 petitionto question the trial court's denial of their motion to dismiss. It is a well-established rule that an order denying amotiontodismiss is interlocutory, andcannotbethesubjectoftheextraordinarypetitionforcertiorariormandamus. The appropriate recourse is to file an answer and to interpose as defenses the objections raised in themotion, to proceed to trial, and, in case of an adverse decision, to elevate the entire case by appeal in due course.[44]While there are recognized exceptions to this rule,[45]petitioners' case does not fall among them.This brings us to the discussion of the substantive issue of the case.Asserting that the RTC of Lipa City is an inconvenient forum, petitioners question its jurisdiction to hear and resolve the civil case for specific performance and damages filed by the respondent. TheICAsubject of the litigation was entered into and perfected inTokyo,Japan, by Japanese nationals, and written wholly in the Japanese language. Thus, petitioners posit that local courts have no substantial relationship to the parties[46]following the [state of the] most significant relationship rule in Private International Law.[47]The Court notes that petitioners adopted an additional but different theory when they elevated the case to the appellate court.In the Motion to Dismiss[48]filed with the trial court, petitioners never contended that the RTC is an inconvenient forum. They merely argued that the applicable law which will determine the validity or invalidity of respondent's claim is that ofJapan, following the principles oflex loci celebrationisandlex contractus.[49]While not abandoning this stance in their petition before the appellate court, petitioners oncertiorarisignificantly invoked the defense offorum non conveniens.[50]On petition for review before this Court, petitioners dropped their other arguments, maintained theforum non conveniensdefense, and introduced their new argument that the applicable principle is the [state of the] most significant relationship rule.[51]Be that as it may, this Court is not inclined to deny this petition merely on the basis of the change in theory, as explained inPhilippine Ports Authority v. City of Iloilo.[52]We only pointed out petitioners' inconstancy in their arguments to emphasize their incorrect assertion of conflict of laws principles.To elucidate, in the judicial resolution of conflicts problems, three consecutive phases are involved: jurisdiction, choice of law, and recognition and enforcement of judgments. Corresponding to these phases are the following questions: (1) Where can or should litigation be initiated? (2) Which law will the court apply? and (3) Where can the resulting judgment be enforced?[53]Analytically, jurisdiction and choice of law are two distinct concepts.[54]Jurisdiction considers whether it is fair to cause a defendant to travel to this state; choice of law asks the further question whether the application of a substantive law which will determine the merits of the case is fair to both parties. The power to exercise jurisdiction does not automatically give a state constitutional authority to apply forum law. While jurisdiction and the choice of thelex foriwill often coincide, the minimum contacts for one do not always provide the necessary significant contacts for the other.[55]The question of whether the law of a state can be applied to a transaction is different from the question of whether the courts of that state have jurisdiction to enter a judgment.[56]In this case, only the first phase is at issuejurisdiction. Jurisdiction, however, has various aspects. For a court to validly exercise its power to adjudicate a controversy, it must have jurisdiction over the plaintiff or the petitioner, over the defendant or the respondent, over the subject matter, over the issues of the case and, in cases involving property, over theresor the thing which is the subject of the litigation.[57]In assailing the trial court's jurisdiction herein, petitioners are actually referring to subject matter jurisdiction.Jurisdictionover the subject matterin a judicial proceeding is conferred by the sovereign authority which establishes and organizes the court. It is given only by law and in the manner prescribed by law.[58]It is further determined by the allegations of the complaint irrespective of whether the plaintiff is entitled to all or some of the claims asserted therein.[59]To succeed in its motion for the dismissal of an action for lack of jurisdiction over the subject matter of the claim,[60]the movant must show that the court or tribunal cannot act on the matter submitted to it because no law grants it the power to adjudicate the claims.[61]In the instant case, petitioners, in their motion to dismiss, do not claim that the trial court is not properly vested by law with jurisdiction to hear the subject controversy for, indeed, Civil Case No. 00-0264 for specific performance and damages is one not capable of pecuniary estimation and is properly cognizable by the RTC of Lipa City.[62]What they rather raiseas grounds to question subject matter jurisdiction are the principles oflex loci celebrationisandlex contractus,and the state of the most significant relationship rule.The Court finds the invocation of these grounds unsound.Lex loci celebrationisrelates to the law of the place of the ceremony[63]or the law of the place where a contract is made.[64]The doctrine oflex contractusorlex loci contractusmeans the law of the place where a contract is executed or to be performed.[65]It controls the nature, construction, and validity of the contract[66]and it may pertain to the law voluntarily agreed upon by the parties or the law intended by them either expressly or implicitly.[67]Under the state of the most significant relationship rule, to ascertain what state law to apply to a dispute, the court should determine which state has the most substantial connection to the occurrence and the parties. In a case involving a contract, the court should consider where the contract was made, was negotiated, was to be performed, and the domicile, place of business, or place of incorporation of the parties.[68]This rule takes into account several contacts and evaluates them according to their relative importance with respect to the particular issue to be resolved.[69]Since these three principles in conflict of laws make reference to the law applicable to a dispute, they are rules proper for the second phase, the choice of law.[70]They determine which state's law is to be applied in resolving the substantive issues of a conflicts problem.[71]Necessarily, as the only issue in this case is that of jurisdiction, choice-of-law rules are not only inapplicable but also not yet called for.Further, petitioners' premature invocation of choice-of-law rules is exposed by the fact that they have not yet pointed out any conflict between the laws ofJapanand ours. Before determining which law should apply, first there should exist a conflict of laws situation requiring the application of the conflict of laws rules.[72]Also, when the law of a foreign country is invoked to provide the proper rules for the solution of a case, the existence of such law must be pleaded and proved.[73]It should be noted that when a conflicts case, one involving a foreign element, is brought before a court or administrative agency, there are three alternatives open to the latter in disposing of it: (1) dismiss the case, either because of lack of jurisdiction or refusal to assume jurisdiction over the case; (2) assume jurisdiction over the case and apply the internal law of the forum; or (3) assume jurisdiction over the case and take into account or apply the law of some other State or States.[74]The courts power to hear cases and controversies is derived from the Constitution and the laws. While it may choose to recognize laws of foreign nations, the court is not limited by foreign sovereign law short of treaties or other formal agreements, even in matters regarding rights provided by foreign sovereigns.[75]

Neither can the other ground raised,forum non conveniens,[76]be used to deprive the trial court of its jurisdiction herein. First, it is not a proper basis for a motion to dismiss because Section 1, Rule 16 of the Rules of Court does not include it as a ground.[77]Second, whether a suit should be entertained or dismissed on the basis of the said doctrine depends largely upon the facts of the particular case and is addressed to the sound discretion of the trial court.[78]In this case, the RTC decided to assume jurisdiction. Third, the propriety of dismissing a case based on this principle requires a factual determination; hence, this conflicts principle is more properly considered a matter of defense.[79]Accordingly, since the RTC is vested by law with the power to entertain and hear the civil case filed by respondent and the grounds raised by petitioners to assail that jurisdiction are inappropriate, the trial and appellate courts correctly denied the petitioners motion to dismiss.WHEREFORE,premises considered, the petition for review oncertiorariisDENIED.

SO ORDERED.-------------------------------

In March 1999, NipponEngineering ConsultantsCo., Ltd, a Japanese firm, was contracted by theDepartment of PublicWorks and Highways (DPWH) to supervise the construction of the Southern Tagalog Access Road. In April 1999, Nippon entered into an independent contractor agreement (ICA) with Minoru Kitamura for the latter to head the said project. The ICA was entered into in Japan and is effective for a period of 1 year (so until April 2000). In January 2000, DPWH awarded the Bongabon-Baler Road project to Nippon. Nippon subsequently assigned Kitamura to head the road project. But in February 2000, KazuhiroHasegawa, the general manager of Nippon informed Kitamura that they are pre-terminating his contract. Kitamura sought Nippon to reconsider but Nippon refused to negotiate. Kitamura then filed a complaint for specific performance and damages against Nippon in the RTC of Lipa.Hasegawafiled a motion to dismiss on the ground that the contract was entered in Japan hence, applying the principle of lex loci celebracionis, cases arising from the contract should be cognizable only by Japanese courts. The trial court denied the motion. Eventually, Nippon filed a petition for certiorari with the Supreme Court.Hasegawa, on appeal significantly changed its theory, this time invoking forum non conveniens; that the RTC is an inconvenient forum because the parties are Japanese nationals who entered into a contract in Japan. Kitamura on the other hand invokes the trial courts ruling which states that matters connected with the performance of contracts are regulated by the law prevailing at the place of performance, so since the obligations in the ICA are executed in the Philippines, courts here have jurisdiction.ISSUE:Whether or not the complaint against Nippon should be dismissed.HELD:No. The trial court did the proper thing in taking cognizance of it.In the first place, the case filed by Kitamura is a complaint for specific performance and damages. Such case is incapable of pecuniary estimation; such cases are within the jurisdiction of the regional trial court.Hasegawafiled his motion to dismiss on the ground of forum non conveniens. However, such ground is not one of those provided for by the Rules as a ground for dismissing a civil case.The Supreme Court also emphasized that the contention that Japanese laws should apply is premature. In conflicts cases, there are three phases and each next phase commences when one is settled, to wit:1. JurisdictionWhere should litigation be initiated?Court must have jurisdiction over the subject matter, the parties, the issues, the property, the res. Also considers, whether it is fair to cause a defendant to travel to this state; choice of law asks the further question whether the application of a substantive law which will determine the merits of the case is fair to both parties.2. Choice of Law Which law will the court apply?Once a local court takes cognizance, it does not mean that the local laws must automatically apply. The court must determine which substantive law when applied to the merits will be fair to both parties.3. Recognition and Enforcement of Judgment Where can the resulting judgment be enforced?This case is not yet in the second phase because upon the RTCs taking cognizance of the case,Hasegawaimmediately filed a motion to dismiss, which was denied. He filed a motion for reconsideration, which was also denied. Then he bypassed the proper procedure by immediately filing a petition for certiorari. The question of which law should be applied should have been settled in the trial court hadHasegawanot improperly appealed the interlocutory order denying his MFR.------------------G.R. No. 162416 January 31, 2006CHESTER DE JOYA,Petitioner,vs.JUDGE PLACIDO C. MARQUEZ, in his capacity as Presiding Judge of Branch 40, Manila-RTC, PEOPLE OF THE PHILIPPINES and THE SECRETARY OF THE DEPARTMENT OF JUSTICE,Respondents.D E C I S I O NAZCUNA,J.:This is a petition for certiorari and prohibition that seeks the Court to nullify and set aside the warrant of arrest issued by respondent judge against petitioner in Criminal Case No. 03-219952 for violation of Article 315, par. 2(a) of the Revised Penal Code in relation to Presidential Decree (P.D.) No. 1689. Petitioner asserts that respondent judge erred in finding the existence of probable cause that justifies the issuance of a warrant of arrest against him and his co-accused.Section 6, Rule 112 of the Revised Rules of Criminal Procedure provides:Sec. 6.When warrant of arrest may issue. (a) By the Regional Trial Court. Within ten (10) days from the filing of the complaint or information, the judge shall personally evaluate the resolution of the prosecutor and its supporting evidence. He may immediately dismiss the case if the evidence on record clearly fails to establish probable cause.If he finds probable cause, he shall issue a warrant of arrest, or a commitment order if the accused has already been arrested pursuant to a warrant issued by the judge who conducted the preliminary investigation or when the complaint or information was filed pursuant to section 7 of this Rule. In case of doubt on the existence of probable cause, the judge may order the prosecutor to present additional evidence within five (5) days from notice and the issuance must be resolved by the court within thirty (30) days from the filing of the complaint or information.x x x1This Court finds from the records of Criminal Case No. 03-219952 the following documents to support the motion of the prosecution for the issuance of a warrant of arrest:1. The report of the National Bureau of Investigation to Chief State Prosecutor Jovencito R. Zuo as regards their investigation on the complaint filed by private complainant Manuel Dy Awiten against Mina Tan Hao @ Ma. Gracia Tan Hao and Victor Ngo y Tan for syndicated estafa. The report shows that Hao induced Dy to invest more than a hundred million pesos in State Resources Development Management Corporation, but when the latters investments fell due, the checks issued by Hao in favor of Dy as payment for his investments were dishonored for being drawn against insufficient funds or that the account was closed.22. Affidavit-Complaint of private complainant Manuel Dy Awiten.33. Copies of the checks issued by private complainant in favor of State Resources Corporation.44. Copies of the checks issued to private complainant representing the supposed return of his investments in State Resources.55. Demand letter sent by private complainant to Ma. Gracia Tan Hao.66. Supplemental Affidavit of private complainant to include the incorporators and members of the board of directors of State Resources Development Management Corporation as participants in the conspiracy to commit the crime of syndicated estafa. Among those included was petitioner Chester De Joya.77. Counter-Affidavits of Chester De Joya and the other accused, Ma. Gracia Hao and Danny S. Hao.Also included in the records are the resolution issued by State Prosecutor Benny Nicdao finding probable cause to indict petitioner and his other co-accused for syndicated estafa,8and a copy of the Articles of Incorporation of State Resources Development Management Corporation naming petitioner as incorporator and director of said corporation.This Court finds that these documents sufficiently establish the existence of probable cause as required under Section 6, Rule 112 of the Revised Rules of Criminal Procedure. Probable cause to issue a warrant of arrest pertains to facts and circumstances which would lead a reasonably discreet and prudent person to believe that an offense has been committed by the person sought to be arrested. It bears remembering that "in determining probable cause, the average man weighs facts and circumstances without resorting to the calibrations of our technical rules of evidence of which his knowledge is nil. Rather, he relies on the calculus of common sense of which all reasonable men have an abundance."9Thus, the standard used for the issuance of a warrant of arrest is less stringent than that used for establishing the guilt of the accused. As long as the evidence presented shows aprima faciecase against the accused, the trial court judge has sufficient ground to issue a warrant of arrest against him.The foregoing documents found in the records and examined by respondent judge tend to show that therein private complainant was enticed to invest a large sum of money in State Resources Development Management Corporation; that he issued several checks amounting toP114,286,086.14 in favor of the corporation; that the corporation, in turn, issued several checks to private complainant, purportedly representing the return of his investments; that said checks were later dishonored for insufficient funds and closed account; that petitioner and his co-accused, being incorporators and directors of the corporation, had knowledge of its activities and transactions. These are all that need to be shown to establish probable cause for the purpose of issuing a warrant of arrest. It need not be shown that the accused are indeed guilty of the crime charged. That matter should be left to the trial. It should be emphasized that before issuing warrants of arrest, judges merely determine personally the probability, not the certainty, of guilt of an accused. Hence, judges do not conduct ade novohearing to determine the existence of probable cause. They just personally review the initial determination of the prosecutor finding a probable cause to see if it is supported by substantial evidence.10In case of doubt on the existence of probable cause, the Rules allow the judge to order the prosecutor to present additional evidence. In the present case, it is notable that the resolution issued by State Prosecutor Benny Nicdao thoroughly explains the bases for his findings that there is probable cause to charge all the accused with violation of Article 315, par. 2(a) of the Revised Penal Code in relation to P.D. No. 1689.The general rule is that this Court does not review the factual findings of the trial court, which include the determination of probable cause for the issuance of warrant of arrest. It is only in exceptional cases where this Court sets aside the conclusions of the prosecutor and the trial judge on the existence of probable cause, that is, when it is necessary to prevent the misuse of the strong arm of the law or to protect the orderly administration of justice. The facts obtaining in this case do not warrant the application of the exception.lavvph!l.ne+In addition, it may not be amiss to note that petitioner is not entitled to seek relief from this Court nor from the trial court as he continuously refuses to surrender and submit to the courts jurisdiction. Justice Florenz D. Regalado explains the requisites for the exercise of jurisdiction and how the court acquires such jurisdiction, thus:x x x Requisites for the exercise of jurisdiction and how the court acquires such jurisdiction:a.Jurisdiction over the plaintiff or petitioner:This is acquired by the filing of the complaint, petition or initiatory pleading before the court by the plaintiff or petitioner.b.Jurisdiction over the defendant or respondent:This is acquired by the voluntary appearance or submission by the defendant or respondent to the court or by coercive process issued by the court to him, generally by the service of summons.c.Jurisdiction over the subject matter:This is conferred by law and, unlike jurisdiction over the parties, cannot be conferred on the court by the voluntary act or agreement of the parties.d.Jurisdiction over the issues of the case: This is determined and conferred by the pleadings filed in the case by the parties, or by their agreement in a pre-trial order or stipulation, or, at times by their implied consent as by the failure of a party to object to evidence on an issue not covered by the pleadings, as provided in Sec. 5, Rule 10.e.Jurisdiction over the res (or the property or thing which is the subject of the litigation).This is acquired by the actual or constructive seizure by the court of the thing in question, thus placing it incustodia legis, as in attachment or garnishment; or by provision of law which recognizes in the court the power to deal with the property or subject matter within its territorial jurisdiction, as in land registration proceedings or suits involving civil status or real property in the Philippines of a non-resident defendant.Justice Regalado continues to explain:In two cases, the court acquires jurisdiction to try the case, even if it has not acquired jurisdiction over the person of a nonresident defendant, as long as it has jurisdiction over theres, as when the action involves the personal status of the plaintiff or property in the Philippines in which the defendant claims an interest. In such cases, the service of summons by publication and notice to the defendant is merely to comply with due process requirements. Under Sec. 133 of the Corporation Code, while a foreign corporation doing business in the Philippines without a license cannot sue or intervene in any action here, it may be sued or proceeded against before our courts or administrative tribunals.11Again, there is no exceptional reason in this case to allow petitioner to obtain relief from the courts without submitting to its jurisdiction. On the contrary, his continued refusal to submit to the courts jurisdiction should give this Court more reason to uphold the action of the respondent judge. The purpose of a warrant of arrest is to place the accused under the custody of the law to hold him for trial of the charges against him. His evasive stance shows an intent to circumvent and frustrate the object of this legal process. It should be remembered that he who invokes the courts jurisdiction must first submit to its jurisdiction.WHEREFORE, the petition isDISMISSED.No costs.SO ORDERED.-----------G.R. No. 173946 June 19, 2013BOSTON EQUITY RESOURCES, INC.,Petitioner,vs.COURT OF APPEALS AND LOLITA G. TOLEDO,Respondents.D E C I S I O NPEREZ,J.:Before the Court is a Petition for Review on Certiorari seeking to reverse and set aside: (1) the Decision,1dated 28 February 2006 and (2) the Resolution,2dated 1 August 2006 of the Court of Appeals in CA-G.R. SP No. 88586. The challenged decision granted herein respondent's petition for certiorari upon a finding that the trial court committed grave abuse of discretion in denying respondent's motion to dismiss the complaint against her.3Based on this finding, the Court of Appeals reversed and set aside the Orders, dated 8 November 20044and 22 December 2004,5respectively, of the Regional Trial Court (RTC) of Manila, Branch 24.The FactsOn 24 December 1997, petitioner filed a complaint for sum of money with a prayer for the issuance of a writ of preliminary attachment against the spouses Manuel and Lolita Toledo.6Herein respondent filed an Answer dated 19 March 1998 but on 7 May 1998, she filed a Motion for Leave to Admit Amended Answer7in which she alleged, among others, that her husband and co-defendant, Manuel Toledo (Manuel), is already dead.8The death certificate9of Manuel states "13 July 1995" as the date of death. As a result, petitioner filed a motion, dated 5 August 1999, to require respondent to disclose the heirs of Manuel.10In compliance with the verbal order of the court during the 11 October 1999 hearing of the case, respondent submitted the required names and addresses of the heirs.11Petitioner then filed a Motion for Substitution,12dated 18 January 2000, praying that Manuel be substituted by his children as party-defendants. It appears that this motion was granted by the trial court in an Order dated 9 October 2000.13Pre-trial thereafter ensued and on 18 July 2001, the trial court issued its pre-trial order containing, among others, the dates of hearing of the case.14The trial of the case then proceeded. Herein petitioner, as plaintiff, presented its evidence and its exhibits were thereafter admitted.On 26 May 2004, the reception of evidence for herein respondent was cancelled upon agreement of the parties. On 24 September 2004, counsel for herein respondent was given a period of fifteen days within which to file a demurrer to evidence.15However, on 7 October 2004, respondent instead filed a motion to dismiss the complaint, citing the following as grounds: (1) that the complaint failed to implead an indispensable party or a real party in interest; hence, the case must be dismissed for failure to state a cause of action; (2) that the trial court did not acquire jurisdiction over the person of Manuel pursuant to Section 5, Rule 86 of the Revised Rules of Court; (3) that the trial court erred in ordering the substitution of the deceased Manuel by his heirs; and (4) that the court must also dismiss the case against Lolita Toledo in accordance with Section 6, Rule 86 of the Rules of Court.16The trial court, in an Order dated 8 November 2004, denied the motion to dismiss for having been filed out of time, citing Section 1, Rule 16 of the 1997 Rules of Court which states that: "Within the time for but before filing the answer to the complaint or pleading asserting a claim, a motion to dismiss may be made x x x."17Respondents motion for reconsideration of the order of denial was likewise denied on the ground that "defendants attack on the jurisdiction of this Court is now barred by estoppel by laches" since respondent failed to raise the issue despite several chances to do so.18Aggrieved, respondent filed a petition for certiorari with the Court of Appeals alleging that the trial court seriously erred and gravely abused its discretion in denying her motion to dismiss despite discovery, during the trial of the case, of evidence that would constitute a ground for dismissal of the case.19The Court of Appeals granted the petition based on the following grounds:It is elementary that courts acquire jurisdiction over the person of the defendant x x x only when the latter voluntarily appeared or submitted to the court or by coercive process issued by the court to him, x x x. In this case, it is undisputed that when petitioner Boston filed the complaint on December 24, 1997, defendant Manuel S. Toledo was already dead, x x x. Such being the case, the court a quo could not have acquired jurisdiction over the person of defendant Manuel S. Toledo.x x x the court a quos denial of respondents motion to dismiss was based on its finding that respondents attack on the jurisdiction of the court was already barred by laches as respondent failed to raise the said ground in its [sic] amended answer and during the pre-trial, despite her active participation in the proceedings.However, x x x it is well-settled that issue on jurisdiction may be raised at any stage of the proceeding, even for the first time on appeal. By timely raising the issue on jurisdiction in her motion to dismiss x x x respondent is not estopped from raising the question on jurisdiction.Moreover, when issue on jurisdiction was raised by respondent, the court a quo had not yet decided the case, hence, there is no basis for the court a quo to invoke estoppel to justify its denial of the motion for reconsideration;It should be stressed that when the complaint was filed, defendant Manuel S. Toledo was already dead. The complaint should have impleaded the estate of Manuel S. Toledo as defendant, not only the wife, considering that the estate of Manuel S. Toledo is an indispensable party, which stands to be benefited or be injured in the outcome of the case. x x xx x x xRespondents motion to dismiss the complaint should have been granted by public respondent judge as the same was in order. Considering that the obligation of Manuel S. Toledo is solidary with another debtor, x x x, the claim x x x should be filed against the estate of Manuel S. Toledo, in conformity with the provision of Section 6, Rule 86 of the Rules of Court, x x x.20The Court of Appeals denied petitioners motion for reconsideration. Hence, this petition.The IssuesPetitioner claims that the Court of Appeals erred in not holding that:1. Respondent is already estopped from questioning the trial courts jurisdiction;2. Petitioner never failed to implead an indispensable party as the estate of Manuel is not an indispensable party;3. The inclusion of Manuel as party-defendant is a mere misjoinder of party not warranting the dismissal of the case before the lower court; and4. Since the estate of Manuel is not an indispensable party, it is not necessary that petitioner file its claim against the estate of Manuel.In essence, what is at issue here is the correctness of the trial courts orders denying respondents motion to dismiss.The Ruling of the CourtWe find merit in the petition.Motion to dismiss filed out of timeTo begin with, the Court of Appeals erred in granting the writ of certiorari in favor of respondent. Well settled is the rule that the special civil action for certiorari is not the proper remedy to assail the denial by the trial court of a motion to dismiss. The order of the trial court denying a motion to dismiss is merely interlocutory, as it neither terminates nor finally disposes of a case and still leaves something to be done by the court before a case is finally decided on the merits.21Therefore, "the proper remedy in such a case is to appeal after a decision has been rendered."22As the Supreme Court held in Indiana Aerospace University v. Comm. on Higher Education:23A writ of certiorari is not intended to correct every controversial interlocutory ruling; it is resorted only to correct a grave abuse of discretion or a whimsical exercise of judgment equivalent to lack of jurisdiction. Its function is limited to keeping an inferior court within its jurisdiction and to relieve persons from arbitrary acts acts which courts or judges have no power or authority in law to perform. It is not designed to correct erroneous findings and conclusions made by the courts. (Emphasis supplied)Even assuming that certiorari is the proper remedy, the trial court did not commit grave abuse of discretion in denying respondents motion to dismiss. It, in fact, acted correctly when it issued the questioned orders as respondents motion to dismiss was filed SIX YEARS AND FIVE MONTHS AFTER SHE FILED HER AMENDED ANSWER. This circumstance alone already warranted the outright dismissal of the motion for having been filed in clear contravention of the express mandate of Section 1, Rule 16, of the Revised Rules of Court. Under this provision, a motion to dismiss shall be filed within the time for but before the filing of an answer to the complaint or pleading asserting a claim.24More importantly, respondents motion to dismiss was filed after petitioner has completed the presentation of its evidence in the trial court, giving credence to petitioners and the trial courts conclusion that the filing of the motion to dismiss was a mere ploy on the part of respondent to delay the prompt resolution of the case against her.Also worth mentioning is the fact that respondents motion to dismiss under consideration herein is not the first motion to dismiss she filed in the trial court. It appears that she had filed an earlier motion to dismiss26on the sole ground of the unenforceability of petitioners claim under the Statute of Frauds, which motion was denied by the trial court. More telling is the following narration of the trial court in its Order denying respondents motion for reconsideration of the denial of her motion to dismiss:As can be gleaned from the records, with the admission of plaintiffs exhibits, reception of defendants evidence was set on March 31, and April 23, 2004 x x x . On motion of the defendants, the hearing on March 31, 2004 was cancelled.On April 14, 2004, defendants sought the issuance of subpoena ad testificandum and duces tecum to one Gina M. Madulid, to appear and testify for the defendants on April 23, 2004. Reception of defendants evidence was again deferred to May 26, June 2 and June 30, 2004, x x x.On May 13, 2004, defendants sought again the issuance of a subpoena duces tecum and ad testificandum to the said Gina Madulid. On May 26, 2004, reception of defendants [sic] evidence was cancelled upon the agreement of the parties. On July 28, 2004, in the absence of defendants witness, hearing was reset to September 24 and October 8, 2004 x x x.On September 24, 2004, counsel for defendants was given a period of fifteen (15) days to file a demurrer to evidence. On October 7, 2004, defendants filed instead a Motion to Dismiss x x x.27Respondents act of filing multiple motions, such as the first and earlier motion to dismiss and then the motion to dismiss at issue here, as well as several motions for postponement, lends credibility to the position taken by petitioner, which is shared by the trial court, that respondent isdeliberately impeding the early disposition of this case. The filing of the second motion to dismiss was, therefore, "not only improper but also dilatory."28Thus, the trial court, "far from deviating or straying off course from established jurisprudence on the matter, x x x had in fact faithfully observed the law and legal precedents in this case."29The Court of Appeals, therefore, erred not only in entertaining respondents petition for certiorari, it likewise erred in ruling that the trial court committed grave abuse of discretion when it denied respondents motion to dismiss.On whether or not respondent is estopped fromquestioning the jurisdiction of the trial courtAt the outset, it must be here stated that, as the succeeding discussions will demonstrate, jurisdiction over the person of Manuel should not be an issue in this case. A protracted discourse on jurisdiction is, nevertheless, demanded by the fact that jurisdiction has been raised as an issue from the lower court, to the Court of Appeals and, finally, before this Court. For the sake of clarity, and in order to finally settle the controversy and fully dispose of all the issues in this case, it was deemed imperative to resolve the issue of jurisdiction.1. Aspects of JurisdictionPetitioner calls attention to the fact that respondents motion to dismiss questioning the trial courts jurisdiction was filed more than six years after her amended answer was filed. According to petitioner, respondent had several opportunities, at various stages of the proceedings, to assail the trial courts jurisdiction but never did so for six straight years. Citing the doctrine laid down in the case of Tijam, et al. v. Sibonghanoy, et al.30petitioner claimed that respondents failure to raise the question of jurisdiction at an earlier stage bars her from later questioning it, especially since she actively participated in the proceedings conducted by the trial court.Petitioners argument is misplaced, in that, it failed to consider that the concept of jurisdiction has several aspects, namely: (1) jurisdiction over the subject matter; (2) jurisdiction over the parties; (3) jurisdiction over the issues of the case; and (4) in cases involving property, jurisdiction over the res or the thing which is the subject of the litigation.31The aspect of jurisdiction which may be barred from being assailed as a result of estoppel by laches is jurisdiction over the subject matter. Thus, in Tijam, the case relied upon by petitioner, the issue involved was the authority of the then Court of First Instance to hear a case for the collection of a sum of money in the amount ofP1,908.00 which amount was, at that time, within the exclusive original jurisdiction of the municipal courts.In subsequent cases citing the ruling of the Court in Tijam, what was likewise at issue was the jurisdiction of the trial court over the subject matter of the case. Accordingly, in Spouses Gonzaga v. Court of Appeals,32the issue for consideration was the authority of the regional trial court to hear and decide an action for reformation of contract and damages involving a subdivision lot, it being argued therein that jurisdiction is vested in the Housing and Land Use Regulatory Board pursuant to PD 957 (The Subdivision and Condominium Buyers Protective Decree). In Lee v. Presiding Judge, MTC, Legaspi City,33petitioners argued that the respondent municipal trial court had no jurisdiction over the complaint for ejectment because the issue of ownership was raised in the pleadings. Finally, in People v. Casuga,34accused-appellant claimed that the crime of grave slander, of which she was charged, falls within the concurrent jurisdiction of municipal courts or city courts and the then courts of first instance, and that the judgment of the court of first instance, to which she had appealed the municipal court's conviction, should be deemed null and void for want of jurisdiction as her appeal should have been filed with the Court of Appeals or the Supreme Court.In all of these cases, the Supreme Court barred the attack on the jurisdiction of the respective courts concerned over the subject matter of the case based on estoppel by laches, declaring that parties cannot be allowed to belatedly adopt an inconsistent posture by attacking the jurisdiction of a court to which they submitted their cause voluntarily.35Here, what respondent was questioning in her motion to dismiss before the trial court was that courts jurisdiction over the person of defendant Manuel. Thus, the principle of estoppel by laches finds no application in this case. Instead, the principles relating to jurisdiction over the person of the parties are pertinent herein.The Rules of Court provide:RULE 9EFFECT OF FAILURE TO PLEADSection 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 15MOTIONSSec. 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.Based on the foregoing provisions, the "objection on jurisdictional grounds which is not waived even if not alleged in a motion to dismiss or the answer is lack of jurisdiction over the subject matter. x x x Lack of jurisdiction over the subject matter can always be raised anytime, even for the first time on appeal, since jurisdictional issues cannot be waived x x x subject, however, to the principle of estoppel by laches."36Since the defense of lack of jurisdiction over the person of a party to a case is not one of those defenses which are not deemed waived under Section 1 of Rule 9, such defense must be invoked when an answer or a motion to dismiss is filed in order to prevent a waiver of the defense.37If the objection is not raised either in a motion to dismiss or in the answer, the objection to the jurisdiction over the person of the plaintiff or the defendant is deemed waived by virtue of the first sentence of the above-quoted Section 1 of Rule 9 of the Rules of Court.38The Court of Appeals, therefore, erred when it made a sweeping pronouncement in its questioned decision, stating that "issue on jurisdiction may be raised at any stage of the proceeding, even for the first time on appeal" and that, therefore, respondent timely raised the issue in her motion to dismiss and is, consequently, not estopped from raising the question of jurisdiction. As the question of jurisdiction involved here is that over the person of the defendant Manuel, the same is deemed waived if not raised in the answer or a motion to dismiss. In any case, respondent cannot claim the defense since "lack of jurisdiction over the person, being subject to waiver, is a personal defense which can only be asserted by the party who can thereby waive it by silence."392. Jurisdiction over the person of a defendant is acquired through a valid service of summons; trial court did not acquire jurisdiction over the person of Manuel ToledoIn the first place, jurisdiction over the person of Manuel was never acquired by the trial court. A defendant is informed of a case against him when he receives summons. "Summons is a writ by which the defendant is notified of the action brought against him. Service of such writ is the means by which the court acquires jurisdiction over his person."40In the case at bar, the trial court did not acquire jurisdiction over the person of Manuel since there was no valid service of summons upon him, precisely because he was already dead even before the complaint against him and his wife was filed in the trial court. The issues presented in this case are similar to those in the case of Sarsaba v. Vda. de Te.41In Sarsaba, the NLRC rendered a decision declaring that Patricio Sereno was illegally dismissed from employment and ordering the payment of his monetary claims. To satisfy the claim, a truck in the possession of Serenos employer was levied upon by a sheriff of the NLRC, accompanied by Sereno and his lawyer, Rogelio Sarsaba, the petitioner in that case. A complaint for recovery of motor vehicle and damages, with prayer for the delivery of the truck pendente lite was eventually filed against Sarsaba, Sereno, the NLRC sheriff and the NLRC by the registered owner of the truck. After his motion to dismiss was denied by the trial court, petitioner Sarsaba filed his answer. Later on, however, he filed an omnibus motion to dismiss citing, as one of the grounds, lack of jurisdiction over one of the principal defendants, in view of the fact that Sereno was already dead when the complaint for recovery of possession was filed.Although the factual milieu of the present case is not exactly similar to that of Sarsaba, one of the issues submitted for resolution in both cases is similar: whether or not a case, where one of the named defendants was already dead at the time of its filing, should be dismissed so that the claim may be pursued instead in the proceedings for the settlement of the estate of the deceased defendant. The petitioner in the Sarsaba Case claimed, as did respondent herein, that since one of the defendants died before summons was served on him, the trial court should have dismissed the complaint against all the defendants and the claim should be filed against the estate of the deceased defendant. The petitioner in Sarsaba, therefore, prayed that the complaint be dismissed, not only against Sereno, but as to all the defendants, considering that the RTC did not acquire jurisdiction over the person of Sereno.42This is exactly the same prayer made by respondent herein in her motion to dismiss.The Court, in the Sarsaba Case, resolved the issue in this wise:x x x We cannot countenance petitioners argument that the complaint against the other defendants should have been dismissed, considering that the RTC never acquired jurisdiction over the person of Sereno. The courts failure to acquire jurisdiction over ones person is a defense which is personal to the person claiming it. Obviously, it is now impossible for Sereno to invoke the same in view of his death. Neither can petitioner invoke such ground, on behalf of Sereno, so as to reap the benefit of having the case dismissed against all of the defendants. Failure to serve summons on Serenos person will not be a cause for the dismissal of the complaint against the other defendants, considering that they have been served with copies of the summons and complaints and have long submitted their respective responsive pleadings. In fact, the other defendants in the complaint were given the chance to raise all possible defenses and objections personal to them in their respective motions to dismiss and their subsequent answers.43(Emphasis supplied.)Hence, the Supreme Court affirmed the dismissal by the trial court of the complaint against Sereno only.Based on the foregoing pronouncements, there is no basis for dismissing the complaint against respondent herein. Thus, as already emphasized above, the trial court correctly denied her motion to dismiss.On whether or not the estate of ManuelToledo is an indispensable partyRule 3, Section 7 of the 1997 Rules of Court states:SEC. 7. Compulsory joinder of indispensable parties. Parties-in-interest without whom no final determination can be had of an action shall be joined either as plaintiffs or defendants.An indispensable party is one who has such an interest in the controversy or subject matter of a case that a final adjudication cannot be made in his or her absence, without injuring or affecting that interest. He or she is a party who has not only an interest in the subject matter of the controversy, but "an interest of such nature that a final decree cannot be made without affecting that interest or leaving the controversy in such a condition that its final determination may be wholly inconsistent with equity and good conscience. It has also been considered that an indispensable party is a person in whose absence there cannot be a determination between the parties already before the court which is effective, complete or equitable." Further, an indispensable party is one who must be included in an action before it may properly proceed.44On the other hand, a "person is not an indispensable party if his interest in the controversy or subject matter is separable from the interest of the other parties, so that it will not necessarily be directly or injuriously affected by a decree which does complete justice between them. Also, a person is not an indispensable party if his presence would merely permit complete relief between him or her and those already parties to the action, or if he or she has no interest in the subject matter of the action." It is not a sufficient reason to declare a person to be an indispensable party simply because his or her presence will avoid multiple litigations.45Applying the foregoing pronouncements to the case at bar, it is clear that the estate of Manuel is not an indispensable party to the collection case, for the simple reason that the obligation of Manuel and his wife, respondent herein, is solidary.The contract between petitioner, on the one hand and respondent and respondents husband, on the other, states:FOR VALUE RECEIVED, I/We jointly and severally46(in solemn) promise to pay BOSTON EQUITY RESOURCES, INC. x x x the sum of PESOS: [ONE MILLION FOUR HUNDRED (P1,400,000.00)] x x x.47The provisions and stipulations of the contract were then followed by the respective signatures of respondent as "MAKER" and her husband as "CO-MAKER."48Thus, pursuant to Article 1216 of the Civil Code, petitioner may collect the entire amount of the obligation from respondent only. The aforementioned provision states: "The creditor may proceed against any one of the solidary debtors or some or all of them simultaneously. The demand made against one of them shall not be an obstacle to those which may subsequently be directed against the others, so long as the debt has not been fully collected."In other words, the collection case can proceed and the demands of petitioner can be satisfied by respondent only, even without impleading the estate of Manuel. Consequently, the estate of Manuel is not an indispensable party to petitioners complaint for sum of money.However, the Court of Appeals, agreeing with the contention of respondent, held that the claim of petitioner should have been filed against the estate of Manuel in accordance with Sections 5 and 6 of Rule 86 of the Rules of Court. The aforementioned provisions provide:SEC. 5. Claims which must be filed under the notice. If not filed, barred; exceptions. All claims for money against the decedent, arising from contract, express or implied, whether the same be due, not due, or contingent, all claims for funeral expenses and judgment for money against the decedent, must be filed within the time limited in the notice; otherwise, they are barred forever, except that they may be set forth as counterclaims in any action that the executor or administrator may bring against the claimants. x x x.SEC. 6. Solidary obligation of decedent. Where the obligation of the decedent is solidary with another debtor, the claim shall be filed against the decedent as if he were the only debtor, without prejudice to the right of the estate to recover contribution from the other debtor. x x x.The Court of Appeals erred in its interpretation of the above-quoted provisions.In construing Section 6, Rule 87 of the old Rules of Court, the precursor of Section 6, Rule 86 of the Revised Rules of Court, which latter provision has been retained in the present Rules of Court without any revisions, the Supreme Court, in the case of Manila Surety & Fidelity Co., Inc. v. Villarama, et. al.,49held:50Construing Section 698 of the Code of Civil Procedure from whence [Section 6, Rule 87] was taken, this Court held that where two persons are bound in solidum for the same debt and one of them dies, the whole indebtedness can be proved against the estate of the latter, the decedents liability being absolute and primary; x x x. It is evident from the foregoing that Section 6 of Rule 87 provides the procedure should the creditor desire to go against the deceased debtor, but there is certainly nothing in the said provision making compliance with such procedure a condition precedent before an ordinary action against the surviving solidary debtors, should the creditor choose to demand payment from the latter, could be entertained to the extent that failure to observe the same would deprive the court jurisdiction to take cognizance of the action against the surviving debtors. Upon the other hand, the Civil Code expressly allows the creditor to proceed against any one of the solidary debtors or some or all of them simultaneously. There is, therefore, nothing improper in the creditors filing of an action against the surviving solidary debtors alone, instead of instituting a proceeding for the settlement of the estate of the deceased debtor wherein his claim could be filed.The foregoing ruling was reiterated and expounded in the later case of Philippine National Bank v. Asuncion51where the Supreme Court pronounced:A cursory perusal of Section 6, Rule 86 of the Revised Rules of Court reveals that nothing therein prevents a creditor from proceeding against the surviving solidary debtors. Said provision merely sets up the procedure in enforcing collection in case a creditor chooses to pursue his claim against the estate of the deceased solidary debtor. The rule has been set forth that a creditor (in a solidary obligation) has the option whether to file or not to file a claim against the estate of the solidary debtor. x x xx x x xIt is crystal clear that Article 1216 of the New Civil Code is the applicable provision in this matter. Said provision gives the creditor the right to "proceed against anyone of the solidary debtors or some or all of them simultaneously." The choice is undoubtedly left to the solidary creditor to determine against whom he will enforce collection. In case of the death of one of the solidary debtors, he (the creditor) may, if he so chooses, proceed against the surviving solidary debtors without necessity of filing a claim in the estate of the deceased debtors. It is not mandatory for him to have the case dismissed as against the surviving debtors and file its claim against the estate of the deceased solidary debtor, x x x. For to require the creditor to proceed against the estate, making it a condition precedent for any collection action against the surviving debtors to prosper, would deprive him of his substantive rightsprovided by Article 1216 of the New Civil Code. (Emphasis supplied.)As correctly argued by petitioner, if Section 6, Rule 86 of the Revised Rules of Court were applied literally, Article 1216 of the New Civil Code would, in effect, be repealed since under the Rules of Court, petitioner has no choice but to proceed against the estate of [the deceased debtor] only. Obviously, this provision diminishes the [creditors] right under the New Civil Code to proceed against any one, some or all of the solidary debtors. Such a construction is not sanctioned by principle, which is too well settled to require citation, that a substantive law cannot be amended by a procedural rule. Otherwise stated, Section 6, Rule 86 of the Revised Rules of Court cannot be made to prevail over Article 1216 of the New Civil Code, the former being merely procedural, while the latter, substantive.Based on the foregoing, the estate of Manuel is not an indispensable party and the case can proceed as against respondent only. That petitioner opted to collect from respondent and not from the estate of Manuel is evidenced by its opposition to respondents motion to dismiss asserting that the case, as against her, should be dismissed so that petitioner can proceed against the estate of Manuel.On whether or not the inclusion of Manuel asparty defendant is a misjoinder of partySection 11 of Rule 3 of the Rules of Court states that "neither misjoinder nor non-joinder of parties is ground for dismissal of an action. Parties may be dropped or added by order of the court on motion of any party or on its own initiative at any stage of the action and on such terms as are just. Any claim against a misjoined party may be severed and proceeded with separately."Based on the last sentence of the afore-quoted provision of law, a misjoined party must have the capacity to sue or be sued in the event that the claim by or against the misjoined party is pursued in a separate case. In this case, therefore, the inclusion of Manuel in the complaint cannot be considered a misjoinder, as in fact, the action would have proceeded against him had he been alive at the time the collection case was filed by petitioner. This being the case, the remedy provided by Section 11 of Rule 3 does not obtain here. The name of Manuel as party-defendant cannot simply be dropped from the case. Instead, the procedure taken by the Court in Sarsaba v. Vda. de Te,52whose facts, as mentioned earlier, resemble those of this case, should be followed herein. There, the Supreme Court agreed with the trial court when it resolved the issue of jurisdiction over the person of the deceased Sereno in this wise:As correctly pointed by defendants, the Honorable Court has not acquired jurisdiction over the person of Patricio Sereno since there was indeed no valid service of summons insofar as Patricio Sereno is concerned. Patricio Sereno died before the summons, together with a copy of the complaint and its annexes, could be served upon him.However, the failure to effect service of summons unto Patricio Sereno, one of the defendants herein, does not render the action DISMISSIBLE, considering that the three (3) other defendants, x x x, were validly served with summons and the case with respect to the answering defendants may still proceed independently. Be it recalled that the three (3) answering defendants have previously filed a Motion to Dismiss the Complaint which was denied by the Court.Hence, only the case against Patricio Sereno will be DISMISSED and the same may be filed as a claim against the estate of Patricio Sereno, but the case with respect to the three (3) other accused [sic] will proceed. (Emphasis supplied.)53As a result, the case, as against Manuel, must be dismissed.In addition, the dismissal of the case against Manuel is further warranted by Section 1 of Rule 3 of the Rules of Court, which states that: only natural or juridical persons, or entities authorized by law may be parties in a civil action." Applying this provision of law, the Court, in the case of Ventura v. Militante,54held:Parties may be either plaintiffs or defendants. x x x. In order to maintain an action in a court of justice, the plaintiff must have an actual legal existence, that is, he, she or it must be a person in law and possessed of a legal entity as either a natural or an artificial person, and no suit can be lawfully prosecuted save in the name of such a person.The rule is no different as regards party defendants. It is incumbent upon a plaintiff, when he institutes a judicial proceeding, to name the proper party defendant to his cause of action. In a suit or proceeding in personam of an adversary character, the court can acquire no jurisdiction for the purpose of trial or judgment until a party defendant who actually or legally exists and is legally capable of being sued, is brought before it. It has even been held that the question of the legal personality of a party defendant is a question of substance going to the jurisdiction of the court and not one of procedure.The original complaint of petitioner named the "estate of Carlos Ngo as represented by surviving spouse Ms. Sulpicia Ventura" as the defendant.1wphi1Petitioner moved to dismiss the same on the ground that the defendant as named in the complaint had no legal personality. We agree.x x x. Considering that capacity to be sued is a correlative of the capacity to sue, to the same extent, a decedent does not have the capacity to be sued and may not be named a party defendant in a court action. (Emphases supplied.)Indeed, where the defendant is neither a natural nor a juridical person or an entity authorized by law, the complaint may be dismissed on the ground that the pleading asserting the claim states no cause of action or for failure to state a cause of action pursuant to Section 1(g) of Rule 16 of the Rules of Court, because a complaint cannot possibly state a cause of action against one who cannot be a party to a civil action.55Since the proper course of action against the wrongful inclusion of Manuel as party-defendant is the dismissal of the case as against him, thus did the trial court err when it ordered the substitution of Manuel by his heirs. Substitution is proper only where the party to be substituted died during the pendency of the case, as expressly provided for by Section 16, Rule 3 of the Rules of Court, which states:Death of party;duty of counsel. Whenever a party to a pending action dies, and the claim is not thereby extinguished, it shall be the duty of his counsel to inform the court within thirty (30) days after such death of the fact thereof, and to give the name and address of his legal representative or representatives. x x xThe heirs of the deceased may be allowed to be substituted for the deceased, without requiring the appointment of an executor or administrator x x x.The court shall forthwith order said legal representative or representatives to appear and be substituted within a period of thirty (30) days from notice. (Emphasis supplied.)Here, since Manuel was already dead at the time of the filing of the complaint, the court never acquired jurisdiction over his person and, in effect, there was no party to be substituted.WHEREFORE, the petition is GRANTED. The Decision dated 28 February 2006 and the Resolution dated 1 August 2006 of the Court of Appeals in CA-G.R. SP No. 88586 are REVERSED and SET ASIDE. The Orders of the Regional Trial Court dated 8 November 2004 and 22 December 2004, respectively, in Civil Case No. 97-86672, are REINSTATED. The Regional Trial Court, Branch 24, Manila is hereby DIRECTED to proceed with the trial of Civil Case No. 97-86672 against respondent Lolita G. Toledo only, in accordance with the above pronouncements of the Court, and to decide the case with dispatch.SO ORDERED.----------------AGGTRUCKINGAND/ORALEXANGGAEID,Petitioners,- versus -MELANIO B. YUAG,Respondent.G.R. No. 195033Present:CARPIO,J.,Chairperson,BRION,SERENO,REYES, andPERLAS-BERNABE,*JJ.Promulgated:October 12, 2011

x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - xDECISIONSERENO,J.:In this Petition for Review on Certiorari under Rule 45 with Prayer for Issuance of Writ of Temporary and/or Permanent Injunction, assailed is the 23 June 2010 Decision of the Court of Appeals (CA), Cagayan de Oro City, in CA-G.R. SP No. 01854-MIN.[1]Reversing the 30 November 2006 Resolution of the National Labor Relations Commission and reinstating, with modification, the 30 August 2006 Decision of the labor arbiter,the CA disposed as follows:WHEREFORE, premises considered, the instant Petition is hereby GRANTED, and the Resolution dated November 30, 2006 is hereby REINSTATED subject to MODIFICATION, thus:Private respondent Alex Ang Gaeid and/or AAG Trucking is hereby ORDERED to pay petitioner Melanio B. Yuag or his heirs or assigns the following:(1) FULL BACKWAGES, inclusive of all allowances, other benefits or their monetary equivalent computed from the time petitioner's compensation was withheld from him starting December 6, 2004 until the time he was employed by his new employer (Bernie Ragandang), instead of the date of his supposed reinstatement which We no longer require as explained above.(2) SEPARATION PAY (in lieu of the supposed reinstatement) equivalent to one-half () month pay for every year of service.A fraction of at least six (6) months shall be considered one (1) whole year.(3) TEMPERATE DAMAGES in the amount of Five Thousand Pesos (Php5,000.00) for the financial loss suffered by the petitioner when he was abruptly dismissed as a truck driver on December 6, 2004 (during or around the Christmas season), although the exact amount of such damage is incapable of exact determination); and(4) EXEMPLARY DAMAGES in the amount of Five Thousand Pesos (Php5,000.00) as a corrective measure in order to set out an example to serve as a negative incentive or deterrent against socially deleterious actions.Considering that a person's wage is his/her means of livelihood i.e., equivalent to life itself, this decision is deemed immediately executory pending appeal, should the private respondent decide to elevate this case to the Supreme Court.SO ORDERED.[2]The Motion for Reconsideration filed by petitioner was denied by the CA.[3]Hence, this Petition.The facts of the case are simple. Petitioner Alex Ang Gaeid had employed respondent Melanio Yuag as a driver since 28 February 2002.He alleged that he had a trucking business, for which he had 41 delivery trucksdriven by 41 drivers, one of whom was respondent.[4]His clients were Busco Sugar Milling Co., Inc., operating in Quezon, Bukidnon; and Coca-cola Bottlers Company in Davao City and Cagayan de Oro City.[5]Respondent received his salary on commission basis of 9% of his gross delivery per trip.He was assigned to a ten-wheeler truck and was tasked to deliver sacks of sugar from the Busco Sugar Mill to the port of Cagayan de Oro.[6]Petitioner noticed that respondent had started incurring substantial shortages since 30 September 2004, when he allegedly had a shortage of 32 bags, equivalent to48,000; followed by 50 bags, equivalent to75,000, on 11 November 2004.[7]It was also reported that he had illegally sold bags of sugar along the way at a lower price, and that he was banned from entering the premises of the Busco Sugar Mill.[8]Petitioner asked for an explanation from respondent who remained quiet.[9]Alarmed at the delivery shortages, petitioner took it upon himself to monitor all his drivers, including respondent, by instructing them to report to him their location from time to time through their mobile phones.[10]He also required them to make their delivery trips in convoy, in order to avoid illegal sale of cargo along the way.[11]Respondent, along with 20 other drivers, was tasked to deliver bags of sugar from Cagayan de Oro City to Coca-Cola Bottlers Plant in Davao City on 4 December 2004.[12]All drivers, with the exception of Yuag who could not be reached through his cellphone, reported their location as instructed.Their reported location gave evidence that they were indeed in convoy.[13]Afterwards, everyone, except Yuag, communicated that the delivery of their respective cargoes had been completed.[14]The Coca-Cola Plant in Davao later reported that the delivery had a suspiciously enormous shortage.[15]Respondent reported to the office of the petitioner on 6 December 2004.Allegedly in a calm and polite manner, petitioner asked respondent to explain why the latter had not contacted petitioner for two days, and he hadnot gone in convoy with the other trucks, as he was told to do.[16]Respondent replied that the battery of his cellphone had broken down.[17]Petitioner then confronted him allegedly still in a polite and civilizedmanner, regarding the large shortages, but the latter did not answer.[18]Petitioner afterwards told him to just take arest or, in their vernacular,pahulay lang una.[19]This exchange started the dispute since respondent construed it as a dismissal.He demanded that it be done in writing, but petitioner merely reiterated that respondent should just take a rest in the meanwhile.[20]The former alleged that respondent had offered to resign and demanded separation pay.At that time, petitioner could not grant the demand, as it would entail computation which was the duty of the cashier.[21]Petitioner asked him to come back the next day.Instead of waiting for another day to go back to his employer, Respondent went to the Department of Labor-Regional Arbitration Board X, that very day of the confrontation or on 6 December 2004. There he filed a Complaint for illegal dismissal, claiming his separation pay and 13thmonth pay.[22]Subsequently, after the delivered goods to the Coca-Cola Plant were weighed on 9 December 2004, it was found out that there was a shortage of 111 bags of sugar, equivalent to166,000.[23]Respondent argued that he was whimsically dismissed, just because he had not been able to answer his employer's call during the time of the delivery.[24]His reason for not answering was that the battery pack of his cellphone had broken down.[25]Allegedly enraged by that incident, his employer, petitioner herein, supposedly shouted at him and told him,pahuway naka.[26]When he asked for a clarification, petitioner allegedly told him,wala nay daghan istorya, pahulay na! This statement wastranslated by the CA thus: No more talking! Take a rest![27]He then realized that he was being dismissed.When he asked for his separation pay, petitioner refused.[28]Respondent thus filed a Complaint for illegal dismissal.Ruling of the Labor ArbiterOn 30 August 2006,labor arbiter Nicodemus G. Palangan rendered his Decision sustaining respondent's Complaint for illegal dismissal.[29]The labor arbiter made a discourse on the existence of an employer-employee relationship between the parties.In granting the relief sought by petitioner, the labor arbiter held as follows:For failure on the part of the respondent to substantially prove the alleged infraction (shortages) committed by complainant and to afford him the due process mandated by law before he was eventually terminated, complainant's dismissal from his employment is hereby declared illegal and the respondent is liable to reinstate him with backwages for one (1) year but in view of the strained relationship that is now prevailing between the parties, this Arbitration Branch finds it more equitable to grant separation pay instead equivalent to one (1) month per year of service based on the average income for the last year of his employment CY 2004 which is P9,974.51, as hereby computed:[30]Thus, the labor arbiter awarded respondent separation pay and proportionate 13thmonth pay for 2004 and 13thmonth pay differential for 2003.[31]Petitioner appealed to the NLRC, alleging that the latter erred in finding that respondent had been illegally dismissed and that the utterance ofpahulay lang una meant actual dismissal.[32]He also alleged that the pecuniary awards of separation pay, backwages, proportionate 13thmonth pay and differential were erroneous. He argued thatpahulay lang unawas not an act of dismissal; rather, he merely wanted to give respondent a break, since the companys clients had lost confidence in respondent.Thus, the latter allegedly had to wait for clients other than Busco Sugar Mill and Coca-Cola, which had banned respondent from entering their premises.Ruling of the NLRCIn a Resolution dated 30 November 2006,[33]the NLRC reversed the labor arbiter's ruling, holding as follows:While the general rule in dismissal cases is that the employer has the burden to prove that the dismissal was for just or authorized causes and after due process, said burden is necessarily shifted to the employee if the alleged dismissal is denied by the employer, as in this case, because a dismissal is supposedly a positive and unequivocal act by the employer.Accordingly, it is the employee that bears the burden of proving that in fact he was dismissed.It was then incumbent upon complainant to prove that he was in fact dismissed from his job by individual respondent Alex V. Ang Gaeid effective December 6, 2004 when the latter told him: Pahuway naka! (You take a rest). Sadly, he failed to discharge that burden.Even assuming that Mr. Gaeid had the intention at that time of dismissing complainant from his job when he uttered the said words to him, there is no proof showing of any overt act subsequently done by Mr. Gaeid that would suggest he carried out such intention.There is no notice of termination served to complainant.Literally construing the remarks of Mr. Gaeid as having been dismissed from his job, complainant immediately filed the instant complaint for illegal dismissal on the same day without first ascertaining the veracity of the same. The how, why and the wherefore of his alleged dismissal should be clearly demonstrated by substantial evidence.Complainant failed to do so; hence, he cannot claim that he was illegally dismissed from employment.[34]The NLRC further held thus:At best, complainant should be considered on leave of absence without pay pending his new assignment. Not having been dismissed much less illegally, complainant is not entitled to the awarded benefits of backwages and separation pay for lack of legal and factual basis.[35]The NLRC likewise held that the complainant was not entitled to 13thmonth pay, since he was paid on purely commission basis, an exception under Presidential Decree No. 851 the law requiring employers to pay 13thmonth pay to their employees.[36]Respondent moved for reconsideration,[37]in effect arguing that petitioner should not be allowed to change the latters theory. Supposedly, the argument in the position paper of petitioner was that there was no employer-employee relationship between them, and that he was compelled to dismiss respondent because of the heavy losses the latter was bringing to petitioner.In this Motion for Reconsideration, respondent admitted that his wife had received the Resolution on 12 January 2007, but that he learned of it much later, on 7 February 2007, justifying the untimely filing of the motion.[38]The NLRC denied the Motion for Reconsideration for being filed out of time.[39]He and his counsel each received notice of the NLRC's Resolution dated 30 November 2006, reversing the labor arbiters Decision on 11 January 2007,[40]but they only filed the motion 25 days after the period to file had already lapsed.[41]Respondent, thus, sought recourse from the CA through a Petition for a Writ of Certiorari under Rule 65.The CA RulingOn 23 June 2010, brushing aside the technicality issue, the CA proceeded to resolve the substantive issues which it deemed important, such as whether there was an employer-employee relationship between petitioner and respondent, and whether it was correct for the NLRC to declare that respondent was not illegally dismissed.[42]It completely reversed the NLRC and came up with the dispositive portion mentioned at the outset.The IssuesPetitioner is now before us citing factual errors that the CA allegedly committed, such as not appreciating petitioner's lack of intention to dismiss respondent. These factual errors, however, are beyond this Court to determine, especially because the records of the proceedings at the level of the labor arbiter were not attached to the Petition.The Court is more interested in the legal issues raised by petitioner and rephrased by the Court as follows:ITHE COURT OF APPEALS ERRED IN REVERSING THE NLRC WITHOUT ANY FINDING OF GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION;IITHE COURT OF APPEALS ERRED IN ENTERTAINING RESPONDENT'S PETITION NOTWITHSTANDING THE FACT THAT HIS MOTION FOR RECONSIDERATION OF THE NLRC'S DECISION WAS FILED OUT OF TIME;IIITHE COURT OF APPEALS ERRED IN GRANTING AWARDS BEYOND WHAT WAS PRAYED FOR IN THE COMPLAINT SUCH AS THE AWARD OF TEMPERATE AND EXEMPLARY DAMAGESThe Court's RulingWe find the Petition impressed with merit.A writ of certiorari is a remedy to correct errors of jurisdiction, for which reason it must clearly show that the public respondent has no jurisdiction to issue an order or to render a decision.Rule 65 of the Rules of Court has instituted the petition for certiorari to correct acts of any tribunal, board or officer exercising judicial or quasi-judicial functions with grave abuse of discretion amounting to lack or excess of jurisdiction.This remedy serves as a check on acts, either of excess or passivity, that constitute grave abuse of discretion of a judicial or quasi-judicial function.This Court, inSan Fernando Rural Bank, Inc. v. Pampanga Omnibus Development Corporation and Dominic G. Aquino,[43]explained thus:Certiorariis a remedy narrow in its scope and inflexible in character. It is not a general utility tool in the legal workshop.Certiorariwill issue only to correct errors of jurisdiction and not to correct errors of judgment. An error of judgment is one which the court may commit in the exercise of its jurisdiction, and which error is reviewable only by an appeal. Error of jurisdiction is one where the act complained of was issued by the court without or in excess of jurisdiction and which error is correctible only by the extraordinary writ ofcertiorari. As long as the court acts within its jurisdiction, any alleged errors committed in the exercise of its discretion will amount to nothing more than mere errors of judgment, correctible by an appeal if the aggrieved party raised factual and legal issues; or a petition for review under Rule 45 of the Rules of Court if only questions of law are involved.A cert[iorari] writ may be issued if the court or quasi-judicial body issues an order with grave abuse of discretion amounting to excess or lack of jurisdiction. Grave abuse of discretion implies such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction or, in other words, where the power is exercised in an arbitrary manner by reason of passion, prejudice, or personal hostility, and it must be so patent or gross as to amount to an evasion of a positive duty or to a virtual refusal to perform the duty enjoined or to act at all in contemplation of law. Mere abuse of discretion is not enough. Moreover, a party is entitled to a writ ofcertiorarionly if there is no appeal nor any plain, speedy or adequate relief in the ordinary course of law. Theraison detrefor the rule is that when a court exercises its jurisdiction, an error committed while so engaged does not deprive it of the jurisdiction being exercised when the error was committed. If it did, every error committed by a court would deprive it of its jurisdiction and every erroneous judgment would be a void judgment. In such a situation, the administration of justice would not survive. Hence, where the issue or question involved affects the wisdom or legal soundness of the decision not the jurisdiction of the court to render said decision the same is beyond the province of a special civil action forcertiorari.[44](citations omitted)Petitioner is correct in its argument that there must first be a finding on whether the NLRC committed grave abuse of discretion and on what these acts were.In this case, the CA seemed to have forgotten that its function in resolving a petition for certiorari was to determine whether there was grave abuse of discretion amounting to lack or excess of jurisdiction on the part of public respondent NLRC.The CA proceeded to review the records and to rule on issues that were no longer disputed during the appeal to the NLRC, such as the existence of an employer-employee relationship.The pivotal issue before the NLRC was whether petitioners telling respondent to take a rest, or to have a break, was already a positive act of dismissing him.This issue was not discussed by the CA.A reading of the assailed Decision will readily reveal the patent errors of the CA. On page 11 of its Decision, it held as follows:The NLRC likewise concluded that petitioner was not entitled to separation pay because he was not a regular employee of private respondent, he (the petitioner) being paid on purely commission or pakyaw basis.The CA took off from that point to give a discussion on regular employment and further held:To Us, private respondent's advice to take a rest theory is nothing but a mere ploy to reinforce his hypothesis that the petitioner is not a regular employee. What makes this worse is that the NLRC bought private respondent's aforesaid theory hook, line and sinker and ruled that the petitioner was neither dismissed from work, he (the petitioner) being considered merely on leave of absence without pay, nor is he (the petitioner) entitled to separation pay on the ground that he was paid on purely commission or pakyaw basis which is in legal parlance, in effect, implies that the petitioner is not a regular employee of the private respondent, but a mere seasonal worker or independent contractor.It is most disturbing to see how the CA regarded labor terms paid on commission,pakyawand seasonal worker as one and the same.