Republic of the PhilippinesSUPREME COURTManilaEN BANCG.R. No. L-62339 October 27, 1983SPOUSES MARIA LUISA P. MORATA AND JULIUS MORATA, petitioners, vs.SPOUSES VICTOR GO and FLORA C. GO and HON. VALERIANO P. TOMOL, JR., Judge, Court of First Instance of Cebu, Branch XI, respondents.Amado G. Olis for petitioners.Paul G. Gorres for private respondents. ESCOLIN., J.:In this petition for certiorari and prohibition with prayer for writ of preliminary injunction, the Court is called upon to determine the classes of actions which fall within the coverage of Presidential Decree No. 1508, 1 otherwise known as Katarungang Pambarangay Law. This law requires the compulsory process of arbitration at the Barangay level as a pre-condition for filing a complaint in court, Petitioners contend that said legislation is so broad and all-embracing as to apply to actions cognizable not only by the city and municipal courts, now known as the metropolitan trial courts and municipal trial courts, but also by the courts of first instance, now the regional trial courts. Upon the other hand, respondents would limit its coverage only to those cases falling within the exclusive jurisdiction of the metropolitan trial courts and municipal trial courts.The antecedent facts are not disputed. On August 5, 1982, respondents Victor Go and Flora D. Go filed in the defunct Court of First Instance of Cebu, presided by respondent Judge Valeriano P. Tomol, Jr., a complaint against petitioners Julius Morata and Ma. Luisa Morata for recovery of a sum of money plus damages amounting to P49,400.00. The case was docketed as Civil Case No. R-22154.On the basis of the allegation in the complaint that the parties-litigants are all residents of Cebu City, petitioners filed a motion to dismiss, citing as grounds therefor, the failure of the complaint to allege prior availment by the plaintiffs of the barangay conciliation process required by P.D. 1508, as well as the absence of a certification by the Lupon or Pangkat Secretary that no conciliation or settlement had been reached by the parties. The motion was opposed by private respondents.On September 2, 1982, respondent judge issued an order denying the motion to dismiss.Petitioners filed a motion for reconsideration, but the same was denied in an order dated October 3, 1982, as follows:

Considering the specific reference to City or Municipal Courts in the provisions of Sections 11 and 12 of P.D. No. 1508, as the Courts to which the dispute settled or arbitrated by the Lupon Chairman or the Pangkat, shall be elevated for nullification of the award or for execution of the same, and considering that from the provision of Section 14 of the same law, the pre- condition to the filing of a complaint as provided for in Section 6 thereof, is specifically referred to, it is the considered opinion of this Court that the provision of Section 6 of the law applies only to cases cognizable by the inferior courts mentioned in Sections 11 and 12 of the law.In view of the foregoing, the motion for reconsideration filed by the defendants, of the order of September 2. 1982, denying their motion to dismiss, is hereby denied. [Annex 'G', p. 36, Rollo].

From this order, petitioners came to Us thru this petition. In a resolution dated December 2, 1982, We required respondents to file an answer, and likewise granted a temporary restraining order enjoining respondent judge from requiring petitioners to file their answer and enter into trial in Civil Case No. R-22154.We find the petition impressed with merit. Section 6 of P.D. 1508 reads as follows:

SECTION 6. Conciliation pre-condition to filing of complaint.— No complaint, petition, action for proceeding involving any matter within the authority of the Lupon as provided in Section 2 hereof shall be filed or instituted in court or any other government office for adjudication unless there has been a confrontation of the parties before the Lupon Chairman or the Pangkat and no conciliation or settlement has been reached as certified by the Lupon Secretary or the Pangkat Secretary attested by the Lupon or Pangkat Chairman, or unless the settlement has been repudiated. However, the parties may go directly to court in the following cases:

[1] Where the accused is under detention;[2] Where a person has otherwise been deprived of personal liberty calling for habeas corpus proceedings;[3] Actions coupled with provisional remedies such as preliminary injunction, attachment, delivery of personal property and support pendente lite; and[4] Where the action may otherwise be barred by the Statute of Limitations

Section 2 of the law defines the scope of authority of the Lupon thus:

SECTION 2. Subject matters for amicable settlement.—The Lupon of each barangay shall have authority to bring together the parties actually residing in the same city or municipality for amicable settlement of all disputes except:[1] Where one party is the government ,or any subdivision or instrumentality thereof;[2] Where one party is a public officer or employee, and the dispute relates to the performance of his official functions;[3] Offenses punishable by imprisonment exceeding 30 days, or a fine exceeding P200.00;[4] Offenses where there is no private offended party;[5] Such other classes of disputes which the Prime Minister may in the interest of justice determine upon recommendation of the Minister of Justice and the Minister of Local Government.

Thus, except in the instances enumerated in sections 2 and 6 of the law, the Lupon has the authority to settle amicably all types of disputes involving parties who actually reside in the same city or municipality. The law, as written, makes no distinction whatsoever with respect to the classes of civil disputes that should be compromised at the barangay level, in contradistinction to the limitation imposed upon the Lupon by paragraph (3), section 2 thereof as regards its authority over criminal cases. In fact, in defining the Lupon's authority, Section 2 of said law employed the universal and comprehensive term "all", to which usage We should neither add nor subtract in consonance with the rudimentary precept in statutory construction that "where the law does not distinguish, We should not distinguish. 2 By compelling the disputants to settle their differences through the intervention of the barangay leader and other respected members of the barangay, the animosity generated by protracted court litigations between members of the same political unit, a disruptive factor toward unity and cooperation, is avoided. It must be borne in mind that the conciliation process at the barangay level is likewise designed to discourage indiscriminate filing of cases in court in order to decongest its clogged dockets and, in the process, enhance the quality of justice dispensed by it. Thus, to say that the authority of the Lupon is limited to cases exclusively cognizable by the inferior courts is to lose sight of this objective. Worse, it would make the law a self-defeating one. For what would stop a party, say in an action for a sum of money or damages, as in the instant case, from bloating up his claim in order to place his case beyond the jurisdiction of the inferior court and thereby avoid the mandatory requirement of P.D. 1508? And why, indeed, should the law seek to ease the congestion of dockets only in inferior courts and not in the regional trial courts where the log-jam of cases is much more serious? Indeed, the lawmakers could not have intended such half-measure and self-defeating legislation.

The objectives of the law are set forth in its preamble thus:WHEREAS, the perpetuation and official recognition of the time-honored tradition of amicably settling disputes among family and barangay level without judicial resources would promote the speedy administration of justice and implement the constitutional mandate to preserve and develop Filipino culture and to strengthen the family as a basic social institution;WHEREAS, the indiscriminate filing of cases in the courts of justice contributes heavily and unjustifiably to the congestion of court dockets, thus causing a deterioration in the quality of justice;WHEREAS, in order to help relieve the courts of such docket congestion and thereby enhance the quality of justice dispensed by the courts, it is deemed desirable to formally organize and institutionalize a system of amicably settling disputes at the barangay level.

There can be no question that when the law conferred upon the Lupon "the authority to bring together the parties actually residing in the same city or municipality for amicable settlement of all disputes, ... ," its obvious intendment was to grant to the Lupon as broad and comprehensive an authority as possible as would bring about the optimum realization of the aforesaid objectives. These objectives would only be half-met and easily thwarted if the Lupon's authority is exercised only in cases falling within the exclusive jurisdiction of inferior courts.Moreover, if it is the intention of the law to restrict its coverage only to cases cognizable by the inferior courts, then it would not have provided in Section 3 thereof the following rule on Venue, to wit:

Section 3. Venue. ... However, all disputes which involve real property or any interest therein shall be brought in the Barangay where the real property or and part thereof is situated.

for it should be noted that, traditionally and historically, jurisdiction over cases involving real property or any interest therein, except forcible entry and detainer cases, has always been vested in the courts of first instance [now regional trial court].But it is pointed out by the respondent judge that Sections 11, 3 12, 4 and 14, 5 of the law speak of the city and/or municipal courts as the forum for the nullification or execution of the settlement or arbitration award issued by the Lupon. We hold that this circumstance cannot be construed as a limitation of the scope of authority of the Lupon. As heretofore stated, the authority of the Lupon is clearly established in Section 2 of the law; whereas Sections 11, 12 and 14, relied upon by respondent judge, deal with the nullification or execution of the settlement or arbitration awards obtained at the barangay level. These sections conferred upon the city and municipal courts the jurisdiction to pass upon and resolve petitions or actions for nullification

or enforcement of settlement/arbitration awards issued by the Lupon, regardless of the amount involved or the nature of the original dispute. But there is nothing in the context of said sections to justify the thesis that the mandated conciliation process in other types of cases applies exclusively to said inferior courts.Any doubt on the issue before Us should be dispelled by Circular No. 22 issued by Chief Justice Enrique M. Fernando, 6 the full text of which is quoted as follows:

TO: ALL JUDGES OF THE COURTS OF FIRST INSTANCE, CIRCUIT CRIMINAL COURTS, JUVENILE AND DOMESTIC RELATIONS COURTS, COURTS OF AGRARIAN RELATIONS, CITY COURTS, MUNICIPAL COURTS AND THEIR CLERKS OF COURTSUBJECT: Implementation of the Katarungang Pambarangay Law.Effective upon your receipt of the certification by the Minister of Local Government and Community Development that all the barangays within your respective jurisdictions have organized their Lupons provided for in Presidential Decree No. 1508, otherwise known as the Katarungang Pambarangay Law, in implementation of the barangay system of settlement of disputes, you are hereby directed to desist from receiving complaints, petitions, actions or proceedings in cases falling within the authority of said Lupons.Circular No. 12 dated October 20, 1978, issued by the late Chief Justice Fred Ruiz Castro is to that extent modified.This Circular takes effect immediately.

It is significant that the above-quoted circular embodying the directive "to desist from receiving complaints, petitions, actions and proceedings in cases falling within the authority of said Lupons," has been addressed not only to judges of city and municipal courts, but also to all the judges of the courts of first instance, circuit criminal courts, juvenile and domestic courts and courts of agrarian relations, now known as regional trial courts under B.P. No. 129. The said circular was noted by president Ferdinand E. Marcos in a Letter of Implementation, dated November 12, 1979, the first paragraph of which reads as follows: "with the view to easing up the log-jam of cases and solving the backlogs in the case of dockets of all government offices involved in the investigation, trial and adjudication of cases, it is hereby ordered that immediate implementation be made by all government officials and offices concerned of the system of amicably settling disputes at the barangay level as provided for in the Katarungang Pambarangay Law [Presidential Decree No. 1508]."Therefore, for the guidance of the bench and the bar, We now declare that the conciliation process at the barangay level, prescribed by P.D. 1508 as a pre-condition for filing a complaint in court, is compulsory not only for cases falling under the

exclusive competence of the metropolitan and municipal trial courts, but for actions cognizable by the regional trial courts as well.ACCORDINGLY, the petition is granted, and the order of respondent judge denying petitioners' motion to dismiss is hereby set aside. Respondent judge is restrained from conducting further proceedings in Civil Case No. R-22154, except to dismiss the case. No costs.SO ORDERED.Fernando, CJ Concepcion, Jr., Guerrero, Abad Santos, Melencio-Herrera, Plana, Relova and Gutierrez, Jr., JJ concur.Makasiar and Teehankee, JJ., reserves his vote.De Castro, J., is on leave.  Separate Opinions AQUINO, J.: concurring:I concur. The case filed by the Go spouses in the Court of First Instance of Cebu for the collection of P49,400 from the Morata spouses, Civil Case No. R-22154, is covered by the Katarungang Pambarangay Law, Presidential Decree No. 1508. The impression that the law applies only to cases filed in inferior courts does not seem to be correct. Of course, the law applies only to disputes between or among persons actually residing in the same barangay or to those involving actual residents of different barangays within the same city or municipality (Sec. 3).Cases between or among those persons should undergo the conciliation process, whatever may be the amount involved or the nature of the issue involved as long as they do not belong to the following cases:

(a) Where the parties involved reside in barangays of different cities or municipalities unless such barangays adjoin each other;(b) Where the dispute involves real property located in different cities or municipalities;(c) Where one party is the government or any sub-division or instrumentality thereof;(d) Where one party is a public officer or employee and the dispute relates to the performance of his official functions;(e) Where the dispute involves an offense punishable by imprisonment exceeding thirty (30) days or a fine exceeding two hundred pesos (P200.00). Thus, physical injuries requiring medical attendance for not exceeding nine (9) days, slight slander, light threats, unjust vexation, would be appropriate subject matters for settlement;

(f) Offenses where there is no private offended party, for example, littering, gambling, jaywalking, public scandal, vagrancy and prostitution; and,(g) Such other classes of disputes which the Prime Minister may, in the interest of justice, determine upon recommendation of the Minister of Justice and the Minister of Local Government and Community Development. (Sec. 2, Rule VI, Katarungan Pambarangay Rules).

The parties may go directly to court in the four cases specified in section 6 of the law.Chief Justice Fernando in his Circular No. 22 dated November 9, 1979 has enjoined all Judges of the Courts of First Instance, Circuit Criminal Courts, Juvenile and Domestic Relations Courts, Agrarian Courts, city courts, municipal courts and their clerks of court to desist from receiving complaints, petitions, actions or proceedings in cases falling within the authority of the barangay Lupons effective upon their receipt of the certification of the Minister of Local Government and Community Development that all the barangays within their respective jurisdictions have organized their Lupons as contemplated in the Katarungang Pambarangay Law.The Minister of Justice has assumed that the Katarungang Pambarangay Law applies to the cases in Regional Trial Courts or Courts of First Instance. Thus, he ruled that a complaint for damages in the sum of P100,000 is a matter falling within the authority of the Lupon under section 2 of Presidential Decree No. 1508 (Opinion No. 81, Series of 1981; Katarungang Pambarangay Opinion No. 10 Series of 198 1).The reference in the law to proper city or municipal court contemplates situations for the enforcement or nullification of settlement or arbitration award. If there is no award, the city or municipal court will have no occasion to intervene.Whether the Lupons, will be equal to the task imposed upon them and should receive commensurate remuneration for their work is another question.  Separate OpinionsAQUINO, J.: concurring:I concur. The case filed by the Go spouses in the Court of First Instance of Cebu for the collection of P49,400 from the Morata spouses, Civil Case No. R-22154, is covered by the Katarungang Pambarangay Law, Presidential Decree No. 1508. The impression that the law applies only to cases filed in inferior courts does not seem to be correct. Of course, the law applies only to disputes between or among persons actually residing in the same barangay or to those involving actual residents of different barangays within the same city or municipality (Sec. 3).

Cases between or among those persons should undergo the conciliation process, whatever may be the amount involved or the nature of the issue involved as long as they do not belong to the following cases:

(a) Where the parties involved reside in barangays of different cities or municipalities unless such barangays adjoin each other;(b) Where the dispute involves real property located in different cities or municipalities;(c) Where one party is the government or any sub-division or instrumentality thereof;(d) Where one party is a public officer or employee and the dispute relates to the performance of his official functions;(e) Where the dispute involves an offense punishable by imprisonment exceeding thirty (30) days or a fine exceeding two hundred pesos (P200.00). Thus, physical injuries requiring medical attendance for not exceeding nine (9) days, slight slander, light threats, unjust vexation, would be appropriate subject matters for settlement;(f) Offenses where there is no private offended party, for example, littering, gambling, jaywalking, public scandal, vagrancy and prostitution; and,(g) Such other classes of disputes which the Prime Minister may, in the interest of justice, determine upon recommendation of the Minister of Justice and the Minister of Local Government and Community Development. (Sec. 2, Rule VI, Katarungan Pambarangay Rules).

The parties may go directly to court in the four cases specified in section 6 of the law.Chief Justice Fernando in his Circular No. 22 dated November 9, 1979 has enjoined all Judges of the Courts of First Instance, Circuit Criminal Courts, Juvenile and Domestic Relations Courts, Agrarian Courts, city courts, municipal courts and their clerks of court to desist from receiving complaints, petitions, actions or proceedings in cases falling within the authority of the barangay Lupons effective upon their receipt of the certification of the Minister of Local Government and Community Development that all the barangays within their respective jurisdictions have organized their Lupons as contemplated in the Katarungang Pambarangay Law.The Minister of Justice has assumed that the Katarungang Pambarangay Law applies to the cases in Regional Trial Courts or Courts of First Instance. Thus, he ruled that a complaint for damages in the sum of P100,000 is a matter falling within the authority of the Lupon under section 2 of Presidential Decree No. 1508 (Opinion No. 81, Series of 1981; Katarungang Pambarangay Opinion No. 10 Series of 198 1).

The reference in the law to proper city or municipal court contemplates situations for the enforcement or nullification of settlement or arbitration award. If there is no award, the city or municipal court will have no occasion to intervene.Whether the Lupons, will be equal to the task imposed upon them and should receive commensurate remuneration for their work is another question.

Republic of the PhilippinesSUPREME COURTManilaTHIRD DIVISIONG.R. No. 167261             March 2, 2007ROSARIA LUPITAN PANG-ET, Petitioner, vs. CATHERINE MANACNES-DAO-AS, Heir of LEONCIO MANACNES and FLORENTINA MANACNES,Respondent.D E C I S I O NCHICO-NAZARIO, J.:Before Us is a Petition for Review on Certiorari under Rule 45 of the Rules of Civil Procedure, assailing the Decision1 of the Court of Appeals in CA-G.R. SP No. 78019, dated 9 February 2005, which reversed and set aside the Judgment2 of the Regional Trial Court (RTC), Branch 36, Bontoc, Mountain Province, and reinstated the Resolution3 of the Municipal Circuit Trial Court (MCTC) of Besao-Sagada, Mountain Province dismissing herein petitioner’s action for Enforcement of Arbitration Award and Damages.The instant petition draws its origin from an Action4 for recovery of possession of real property situated in Sitio Abatan, Barrio Dagdag, Sagada filed by herein petitioner before the MCTC of Besao-Sagada, Mountain Province on 9 November 1994, against the spouses Leoncio and Florentina Manacnes, the predecessors-in-interest of herein respondent.On 23 February 1995, during the course of the pre-trial, the parties, through their respective counsels, agreed to refer the matter to the Barangay Lupon (Lupon) of Dagdag, Sagada for arbitration in accordance with the provisions of the Katarungang Pambarangay Law.5 Consequently, the proceedings before the MCTC were suspended, and the case was remanded to the Lupon for resolution.6

Thereafter, the Lupon issued a Certification to File Action on 26 February 1995 due to the refusal of the Manacnes spouses to enter into an Agreement for Arbitration and their insistence that the case should go to court. On 8 March 1995, the Certification, as well as the records of the case, were forwarded to the MCTC.An Order was issued by the MCTC on 7 April 1995, once more remanding the matter for conciliation by the Lupon and ordering the Lupon to render an Arbitration Award thereon. According to the MCTC, based on the records of the case, an Agreement for Arbitration was executed by the parties concerned; however, the Lupon failed to issue an Arbitration Award as provided under the Katarungang Pambarangay Law, so that, the case must be returned to the Lupon until an Arbitration Award is rendered.

In compliance with the MCTC Order, the Lupon rendered an Arbitration Award on 10 May 1995 ordering herein petitioner to retrieve the land upon payment to the spouses Manacnes of the amount of P8,000.00 for the improvements on the land. Aggrieved, Leoncio’s widow,7 Florentina Manacnes, repudiated the Arbitration Award but her repudiation was rejected by the Lupon. Thereafter, the MCTC was furnished with copies of the Arbitration Award.On 1 June 1995, herein petitioner filed with the Lupon a Motion for Execution of the Arbitration Award. On the other hand, Florentina Manacnes filed a Motion with the MCTC for the resumption of the proceedings in the original case for recovery of possession and praying that the MCTC consider her repudiation of the Arbitration Award issued by the Lupon.Subsequently, the MCTC heard the Motion of Florentina Manacnes notwithstanding the latter’s failure to appear before the court despite notice. The MCTC denied Florentina Manacnes’ Motion to repudiate the Arbitration Award elucidating that since the movant failed to take any action within the 10-day reglementary period provided for under the Katarungang Pambarangay Law, the arbitration award has become final and executory. Furthermore, upon motion of herein petitioner Pang-et, the MCTC issued an Order remanding the records of the case to the Lupon for the execution of the Arbitration Award. On 31 August 1995, the then incumbent Punong Barangay of Dagdag issued a Notice of Execution of the Award.Said Notice of Execution was never implemented. Thus, on 16 October 2001, herein petitioner Pang-et filed with the MCTC an action for enforcement of the Arbitration Award which was sought to be dismissed by the heir of the Manacnes spouses.8 The heir of the Manacnes spouses argues that the Agreement for Arbitration and the Arbitration Award are void, the Agreement for Arbitration not having been personally signed by the spouses Manacnes, and the Arbitration Award having been written in English – a language not understood by the parties.In its Resolution dated 20 August 2002, the MCTC dismissed the Petition for Enforcement of Arbitration Award in this wise:x x x Are defendants estopped from questioning the proceedings before the Lupon Tagapamayapa concerned?The defendants having put in issue the validity of the proceedings before the lupon concerned and the products thereof, they are not estopped. It is a hornbook rule that a null and void act could always be questioned at any time as the action or defense based upon it is imprescriptible.The second issue: Is the agreement to Arbitrate null and void? Let us peruse the pertinent law dealing on this matter which is Section 413 of the Local Government Code of 1991 (RA 7160), to wit:

"Section 413 – (a) The parties may, at any stage of the proceedings, agree in writing that they shall abide by the arbitration award of the lupon chairman or the pangkat. x x x"The foregoing should be taken together with Section 415 of the same code which provides:"Section 415. Appearance of parties in person. In all katarungang pambarangay proceedings, the parties must appear in person without the assistance of counsel or representative, except for minors and incompetents who may be assisted by their next-of-kin who are not lawyers."It is very clear from the foregoing that personal appearance of the parties in conciliation proceedings before a Lupon Tagapamayapa is mandatory. Likewise, the execution of the agreement to arbitrate must be done personally by the parties themselves so that they themselves are mandated to sign the agreement.Unfortunately, in this case, it was not respondents-spouses [Manacnis] who signed the agreement to arbitrate as plaintiff herself admitted but another person. Thus, it is very clear that the mandatory provisos of Section 413 and 415 of RA 7160 are violated. Granting arguendo that it was Catherine who signed the agreement per instruction of her parents, will it cure the violation? The answer must still be in the negative. As provided for by the cited provisos of RA 7160, if ever a party is entitled to an assistance, it shall be done only when the party concerned is a minor or incompetent. Here, there is no showing that the spouses [Manacnis] were incompetent. Perhaps very old but not incompetent. Likewise, what the law provides is assistance, not signing of agreements or settlements.Just suppose the spouses [Manacnis] executed a special power of attorney in favor of their daughter Catherine to attend the proceedings and to sign the agreement to arbitrate? The more that it is proscribed by the Katarungang Pambarangay Law specifically Section 415 of RA 7160 which mandates the personal appearance of the parties before the lupon and likewise prohibits the appearance of representatives.In view of the foregoing, it could now be safely concluded that the questioned agreement to arbitrate is inefficacious for being violative of the mandatory provisions of RA 7160 particularly sections 413 and 415 thereof as it was not the respondents-spouses [Manacnis] who signed it.The third issue: Is the Arbitration Award now sought to be enforced effective? Much to be desired, the natural flow of events must follow as a consequence. Considering that the agreement to arbitrate is inefficacious as earlier declared, it follows that the arbitration award which emanated from it is also inefficacious. Further, the Arbitration Award by itself, granting arguendo that the agreement to arbitrate is valid, will readily show that it does not also conform with the mandate of the Katarungang Pambarangay Law particularly Section 411 thereto which provides:

"Sec. 411. Form of Settlement – All amicable settlements shall be in writing in a language or dialect known to the parties x x x. When the parties to the dispute do not use the same language or dialect, the settlement shall be written in the language known to them."Likewise, the implementing rules thereof, particularly Section 13 provides:"Sec. 13 – Form of Settlement and Award. – All settlements, whether by mediation, conciliation or arbitration, shall be in writing, in a language or dialect known to the parties. x x x"It is of no dispute that the parties concerned belong to and are natives of the scenic and serene community of Sagada, Mt. Province who speak the Kankanaey language. Thus, the Arbitration Award should have been written in the Kankanaey language. However, as shown by the Arbitration Award, it is written in English language which the parties do not speak and therefore a further violation of the Katarungang Pambarangay Law.IN THE LIGHT of all the foregoing considerations, the above-entitled case is hereby dismissed.9

Petitioner Pang-et’s Motion for Reconsideration having been denied, she filed an Appeal before the RTC which reversed and set aside the Resolution of the MCTC and remanded the case to the MCTC for further proceedings. According to the RTC:As it appears on its face, the Agreement for Arbitration in point found on page 51 of the expediente, dated Feb. 6, 1995, and attested by the Pangkat Chairman of the Office of the Barangay Lupon of Dagdag, Sagada was signed by the respondents/defendants spouses Manacnis. The representative of the Appellee in the instant case assails such Agreement claiming that the signatures of her aforesaid predecessors-in-interest therein were not personally affixed by the latter or are falsified-which in effect is an attack on the validity of the document on the ground that the consent of the defendants spouses Manacnis is vitiated by fraud. Indulging the Appellee Heirs of Manacnis its contention that such indeed is the truth of the matter, the fact still remains as borne out by the circumstances, that neither did said original defendants nor did any of such heirs effectively repudiate the Agreement in question in accordance with the procedure outlined by the law, within five (5) days from Feb. 6, 1995, on the ground as above-stated (Secs. 413 (a), 418, RA 7160; Secs. 7, 13, KP Law; Sec. 12, Rule IV, KP Rules). As mandated, such failure is deemed a waiver on the part of the defendants spouses Manacnis to challenge the Agreement for Arbitration on the ground that their consent thereto is obtained and vitiated by fraud (Sec. 12, Par. 3, KP Rules). Corollarily, the Appellee Heirs being privy to the now deceased original defendants should have not been permitted by the court a quo under the equitable principle of estoppel, to raise the matter in issue for the first time in the present case (Lopez vs. Ochoa, 103 Phil. 94).

The Arbitration Award relative to Civil Case 83 (B.C. No. 07) dated May 10, 1995, written in English, attested by the Punong Barangay of Dagdag and found on page 4 of the record is likewise assailed by the Appellee as void on the ground that the English language is not known by the defendants spouses Manacnis who are Igorots. Said Appellee contends that the document should have been written in Kankana-ey, the dialect known to the party (Sec. 413 (b), RA 7160; Sec. 7, Par. 2, KP law, Sec. 11, KP Rules). On this score, the court a quo presumptuously concluded on the basis of the self-serving mere say-so of the representative of the Appellee that her predecessors did not speak or understand English. As a matter of judicial notice, American Episcopalian Missionaries had been in Sagada, Mountain Province as early as 1902 and continuously stayed in the place by turns, co-mingling with the indigenous people thereat, instructing and educating them, and converting most to the Christian faith, among other things, until the former left about twenty years ago. By constant association with the white folks, the natives too old to go to school somehow learned the King’s English by ear and can effectively speak and communicate in that language. Any which way, even granting arguendo that the defendants spouses Manacnis were the exceptions and indeed totally ignorant of English, no petition to nullify the Arbitration award in issue on such ground as advanced was filed by the party or any of the Appellee Heirs with the MCTC of Besao-Sagada, within ten (10) days from May 10, 1995, the date of the document. Thus, upon the expiration thereof, the Arbitration Award acquired the force and effect of a final judgment of a court (Sec. 416, RA 7160; Sec. 11, KP Law; Sec. 13, KP Rules); conclusive upon the original defendants in Civil Case 83 (B.C. No. 07) and the Appellee Heirs herein privy to said defendants.In the light thereof, the collateral attack of the Appellee on the Agreement for Arbitration and Arbitration Award re Civil Case 83 (B.C. No. 07) should not have in the first place been given due course by the court a quo. In which case, it would not have in the logical flow of things declared both documents "inefficacious"; without which pronouncements, said court would not have dismissed the case at bar.Wherefore, Judgment is hereby rendered Reversing and Setting Aside the Resolution appealed from, and ordering the record of the case subject thereof remanded to the court of origin for further proceedings.10

Aggrieved by the reversal of the RTC, herein respondent filed a petition before the Court of Appeals seeking to set aside the RTC Judgment. On 9 February 2005, the appellate court rendered the herein assailed Decision, to wit:After thoroughly reviewing through the record, We find nothing that would show that the spouses Manacnes were ever amenable to any compromise with respondent Pang-et. Thus, We are at a loss as to the basis of the Arbitration Award sought to be enforced by respondent Pang-et’s subsequent action before the MCTC.

There is no dispute that the proceeding in Civil Case No. 83 was suspended and the same remanded to the Lupon on account of the Agreement to Arbitrate which was allegedly not signed by the parties but agreed upon by their respective counsels during the pre-trial conference. In the meeting before the Lupon, it would seem that the agreement to arbitrate was not signed by the spouses Manacnes. More importantly, when the pangkat chairman asked the spouses Manacnes to sign or affix their thumbmarks in the agreement, they refused and insisted that the case should instead go to court. Thus, the Lupon had no other recourse but to issue a certificate to file action. Unfortunately, the case was again remanded to the Lupon to "render an arbitration award". This time, the Lupon heard the voice tape of the late Beket Padonay affirming respondent Pang-et’s right to the disputed property. While Pang-et offered to pay P8,000.00 for the improvements made by the spouses Manacnes, the latter refused to accept the same and insisted on their right to the subject property. Despite this, the Lupon on May 10, 1995 issued an Arbitration award which favored respondent Pang-et.From the time the case was first referred to the Lupon to the time the same was again remanded to it, the Spouses Manacnes remained firm in not entering into any compromise with respondent Pang-et. This was made clear in both the minutes of the Arbitration Hearing on 26 February 1995 and on 9 April 1995. With the foregoing, We find it evident that the spouses Manacnes never intended to submit the case for arbitration.Moreover, the award itself is riddled with flaws. First of all there is no showing that the Pangkat ng Tagapagkasundo was duly constituted in accordance with Rule V of the Katarungan Pambarangay Rules. And after constituting of the Pangkat, Rule VI, thereof the Punong Barangay and the Pangkat must proceed to hear the case. However, according to the minutes of the hearing before the lupon on 9 April 1995, the pangkat Chairman and another pangkat member were absent for the hearing.Finally, Section 13 of the same Rule requires that the Punong Barangay or the Pangkat Chairman should attest that parties freely and voluntarily agreed to the settlement arrived at. But how can this be possible when the minutes of the two hearings show that the spouses Manacnes neither freely nor voluntarily agreed to anything.While RA 7160 and the Katarungan Pambarangay rules provide for a period to repudiate the Arbitration Award, the same is neither applicable nor necessary since the Agreement to Arbitrate or the Arbitration Award were never freely nor voluntarily entered into by one of the parties to the dispute. In short, there is no agreement validly concluded that needs to be repudiated.With all the foregoing, estoppel may not be applied against petitioners for an action or defense against a null and void act does not prescribe. With this, We cannot but

agree with the MCTC that the very agreement to arbitrate is null and void. Similarly, the arbitration award which was but the off shoot of the agreement is also void.WHEREFORE, the RTC judgment of 2 June 2003 is REVERSED and SET ASIDE, the MCTC Resolution DISMISSING the Civil Case No. 118 for enforcement of Arbitration Award is REINSTATED.11

Vehemently disagreeing with the Decision of the Court of Appeals, petitioner Pang-et filed the instant petition. Petitioner maintains that the appellate court overlooked material facts that resulted in reversible errors in the assailed Decision. According to petitioner, the Court of Appeals overlooked the fact that the original parties, as represented by their respective counsels in Civil Case No. 83, mutually agreed to submit the case for arbitration by the Lupon ng Tagapamayapa of Barangay Dagdag. Petitioner insists that the parties must be bound by the initial agreement by their counsels during pre-trial to an amicable settlement as any representation made by the lawyers are deemed made with the conformity of their clients. Furthermore, petitioner maintains that if indeed the spouses Manacnes did not want to enter into an amicable settlement, then they should have raised their opposition at the first instance, which was at the pre-trial on Civil Case No. 83 when the MCTC ordered that the case be remanded to the Lupon ng Tagapamayapa for arbitration.We do not agree with the petitioner.First and foremost, in order to resolve the case before us, it is pivotal to stress that, during the initial hearing before the Lupon ng Tagapamayapa, the spouses Manacnes declined to sign the Agreement for Arbitration and were adamant that the proceedings before the MCTC in Civil Case No. 83 must continue. As reflected in the Minutes12 of the Arbitration Hearing held on 26 February 1995, the legality of the signature of Catherine Manacnes, daughter of the Manacnes spouses, who signed the Agreement for Arbitration on behalf of her parents, was assailed on the ground that it should be the spouses Manacnes themselves who should have signed such agreement. To resolve the issue, the Pangkat Chairman then asked the spouses Manacnes that if they wanted the arbitration proceedings to continue, they must signify their intention in the Agreement for Arbitration form. However, as stated earlier, the Manacnes spouses did not want to sign such agreement and instead insisted that the case go to court.Consequently, the Lupon issued a Certification to File Action on 26 February 1995 due to the refusal of the Manacnes spouses. Indicated in said Certification are the following: 1) that there was personal confrontation between the parties before the Punong Barangay but conciliation failed and 2) that the Pangkat ng Tagapagkasundo was constituted but the personal confrontation before the Pangkat failed likewise because respondents do not want to submit this case for arbitration and insist that said case will go to court.13Nevertheless, upon receipt of said certification and the

records of the case, the MCTC ordered that the case be remanded to the Lupon ng Tagapamayapa and for the latter to render an arbitration award, explaining that:Going over the documents submitted to the court by the office of the Lupon Tagapamayapa of Dagdag, Sagada, Mountain Province, the court observed that an "Agreement for Arbitration" was executed by the parties anent the above-entitled case. However, said Lupon did not make any arbitration award as mandated by the Katarungang Pambarangay Law but instead made a finding that the case may now be brought to the court. This is violative of the KP Law, which cannot be sanctioned by the court.14

At this juncture, it must be stressed that the object of the Katarungang Pambarangay Law is the amicable settlement of disputes through conciliation proceedings voluntarily and freely entered into by the parties.15Through this mechanism, the parties are encouraged to settle their disputes without enduring the rigors of court litigation. Nonetheless, the disputing parties are not compelled to settle their controversy during the barangay proceedings before the Lupon or the Pangkat, as they are free to instead find recourse in the courts16 in the event that no true compromise is reached.The key in achieving the objectives of an effective amicable settlement under the Katarungang Pambarangay Law is the free and voluntary agreement of the parties to submit the dispute for adjudication either by the Lupon or the Pangkat, whose award or decision shall be binding upon them with the force and effect of a final judgment of a court.17 Absent this voluntary submission by the parties to submit their dispute to arbitration under the Katarungang Pambarangay Law, there cannot be a binding settlement arrived at effectively resolving the case. Hence, we fail to see why the MCTC further remanded the case to the Lupon ng Tagapamayapa and insisted that the arbitration proceedings continue, despite the clear showing that the spouses Manacnes refused to submit the controversy for arbitration.It would seem from the Order of the MCTC, which again remanded the case for arbitration to the Lupon ng Tagapamayapa, that it is compulsory on the part of the parties to submit the case for arbitration until an arbitration award is rendered by the Lupon. This, to our minds, is contrary to the very nature of the proceedings under the Katarungang Pambarangay Law which espouses the principle of voluntary acquiescence of the disputing parties to amicable settlement.What is compulsory under the Katarungang Pambarangay Law is that there be a confrontation between the parties before the Lupon Chairman or the Pangkat and that a certification be issued that no conciliation or settlement has been reached, as attested to by the Lupon or Pangkat Chairman, before a case falling within the authority of the Lupon may be instituted in court or any other government office for adjudication. 18 In other words, the only necessary pre-condition before any case falling within the authority of the Lupon or the Pangkat may be filed before a court is

that there has been personal confrontation between the parties but despite earnest efforts to conciliate, there was a failure to amicably settle the dispute. It should be emphasized that while the spouses Manacnes appeared before the Lupon during the initial hearing for the conciliation proceedings, they refused to sign the Agreement for Arbitration form, which would have signified their consent to submit the case for arbitration. Therefore, upon certification by the Lupon ng Tagapamayapa that the confrontation before the Pangkat failed because the spouses Manacnes refused to submit the case for arbitration and insisted that the case should go to court, the MCTC should have continued with the proceedings in the case for recovery of possession which it suspended in order to give way for the possible amicable resolution of the case through arbitration before the Lupon ng Tagapamayapa.Petitioner’s assertion that the parties must be bound by their respective counsels’ agreement to submit the case for arbitration and thereafter enter into an amicable settlement is imprecise. What was agreed to by the parties’ respective counsels was the remand of the case to the Lupon ng Tagapamayapa for conciliation proceedings and not the actual amicable settlement of the case. As stated earlier, the parties may only be compelled to appear before the Lupon ng Tagapamayapa for the necessary confrontation, but not to enter into any amicable settlement, or in the case at bar, to sign the Agreement for Arbitration. Thus, when the Manacnes spouses personally appeared during the initial hearing before the Lupon ng Tagapamayapa, they had already complied with the agreement during the pre-trial to submit the case for conciliation proceedings. Their presence during said hearing is already their acquiescence to the order of the MCTC remanding the case to the Lupon for conciliation proceedings, as there has been an actual confrontation between the parties despite the fact that no amicable settlement was reached due to the spouses Manacnes’ refusal to sign the Agreement for Arbitration.Furthermore, the MCTC should not have persisted in ordering the Lupon ng Tagapamayapa to render an arbitration award upon the refusal of the spouses Manacnes to submit the case for arbitration since such arbitration award will not bind the spouses. As reflected in Section 413 of the Revised Katarungang Pambarangay Law, in order that a party may be bound by an arbitration award, said party must have agreed in writing that they shall abide by the arbitration award of the Lupon or the Pangkat. Like in any other contract, parties who have not signed an agreement to arbitrate will not be bound by said agreement since it is axiomatic that a contract cannot be binding upon and cannot be enforced against one who is not a party to it.19 In view of the fact that upon verification by the Pangkat Chairman, in order to settle the issue of whether or not they intend to submit the matter for arbitration, the spouses Manacnes refused to affix their signature or thumb mark on the Agreement for Arbitration Form, the Manacnes spouses cannot be bound by the Agreement for

Arbitration and the ensuing arbitration award since they never became privy to any agreement submitting the case for arbitration by the Pangkat.WHEREFORE, premises considered, the instant petition is hereby DENIED. The Decision of the Court of Appeals in CA-G.R. SP No. 78019 is hereby AFFIRMED. The Municipal Circuit Trial Court of Besao-Sagada, Mountain Province, is hereby ORDERED to proceed with the trial of Civil Case No. 83 for Recovery of Possession of Real Property, and the immediate resolution of the same with deliberate dispatch. No costs.SO ORDERED.

THIRD DIVISION 

DANTE M. PASCUAL, represented by REYMEL R. SAGARIO,

Petitioner,   -versus-   MARILOU M. PASCUAL,

Respondent.

G.R. No.  157830 Present:

 PANGANIBAN, Chairman,SANDOVAL- GUTIERREZ,*

CORONA,CARPIO MORALES, andGARCIA, JJ.

 Promulgated: November 17, 2005

   x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -   - - - - - - - - - - - - - - - x D E C I S I O N CARPIO MORALES, J.:            On challenge via Petition for Review on Certiorari is the February 10, 2003 Order of the Regional Trial Court (RTC) of Isabela, Branch 23 at Roxas dismissing, on motion of herein respondent Marilou M. Pascual, the complaint filed against her by her brother-herein petitioner Dante M. Pascual, represented by his attorney-in-fact Reymel R. Sagario (Sagario), for non-compliance with the conciliation provision-pre condition to filing of complaint in court under R.A. 7160 (the Local Government Code).           Petitioner, a permanent resident of the United States of America, appointed Sagario as his attorney-in-fact by a Special Power of Attorney (SPA) dated April 10, 2002:

            1.  To file a case for the cancellation of Transfer Certificate of Title No. T-271656 issued in the name of Marilou M. Pascual as well as the Deed of Sale of Registered Land (Dec. No. 639;  Page No. 52;  Book No. XXI;  Series of 1994) and/or Reconveyance at the appropriate court;

             2.  To collect the monthly rentals from the tenant;             3.  To enter into amicable settlement with Marilou M. Pascual or any other mode of payment/and/or dispute resolution;             4.  To execute and sign any and all papers, contracts/documents which may be necessary relative to the above acts. x x x[1]

  

          Pursuant to the SPA, Sagario filed on October 14, 2002 before the Isabela RTC at Roxas a complaint entitled “Dante M. Pascual, plaintiff v. Marilou M. Pascual and Register of Deeds, Defendants,” docketed as Civil Case No. Br. 23-713-02, for Annulment of Transfer Certificate of Title No. T-271657 of Isabela and Deed of Absolute Sale of Registered Land and/or Reconveyance with Damages.[2]

           To the Complaint the defendant-herein respondent Marilou M. Pascual filed a Motion to Dismiss[3] on two grounds one of which was non-compliance with the requirement under Section 412 of the Local Government Code,[4] she contending that there is no showing that the dispute was referred to the barangay court before the case was filed in court.           By the assailed Order of February 10, 2003,[5] Branch 23 of the Isabela RTC at Roxas granted respondent’s Motion to Dismiss in this wise: 

. . . RA 7160 repealing P.D. 1508 otherwise known as the Revised Katarungang Pambarangay provides under Section 409 “All disputes involving real property or any interest therein shall be brought in the barangay where the real property or the larger portion thereof is situated.”  Hence, the reliance of the plaintiff on Section 408 of R.A. 7160 is incorrect.  When real property or any interest therein is involved, the dispute shall be filed before the barangay where the property is located,   regardless of the residence of the parties.  Besides, it is incorrect to say that the parties are not residents of the same place, Vira, Roxas, Isabela.  The Attorney-in-fact of the plaintiff in the person of Reymel R. Sagario is a resident of Vira, Roxas, Isabela, and he

substitute (sic)   Dante Pascual by virtue of said Special Power of Attorney.  Hence, said Attorney-in-fact should have brought the dispute before barangay Vira, Roxas, Isabela, where the property is located.  In the case of Royales vs. Intermediate Appellate Court 127 SCRA 470, “Ordinarily, non-compliance with the condition precedent prescribed by P.D. 1508 could affect the sufficiency of the plaintiff’s cause of action and make his complaint vulnerable to dismissal on ground of lack of cause of action or prematurity.” [6]  (Emphasis and underscoring supplied) 

                   Petitioner’s Motion for Reconsideration[7] of the above-said order was denied by Order of March 24, 2003:[8]

 x x x             Consequently, the Court is [of] the opinion that the said Attorney-in-fact shall be deemed to be the real party in interest, reading from the tenor of the provisions of the Special Power of Attorney.  Being a real party in interest, the Attorney-in-fact is therefore obliged to bring this case first before the Barangay Court.  Sec. 3, Rule 3 of the Rules of Court provides that “Where the action is allowed to be prosecuted or defended by a representative or someone acting in a fiduciary capacity, the beneficiary shall be included in the title of the case and shall be deemed to be the real party in interest. x x x                       Being the real party in interest, the Attorney-in-fact may therefore bring the necessary complaint before the Lupon Tagapayapa and   appear in person as if he is the owner of the land.[9]  (Emphasis and underscoring supplied)

           Hence, the present petition questioning “the palpable legal errors” of the RTC.           Petitioner argues that since he, not his attorney-in-fact Sagario, is the real party in interest, and since he actually resides abroad, the lupon would have no jurisdiction to pass upon the dispute involving real property, he citing Agbayani v. Belen.[10]      

          Respondent submits, on the other hand, that Section 408, paragraph (f), of the Local Government Code, is qualified by paragraph (c) of Section 409 of the same Code the latter of which provides that “[a]ll disputes involving real property or any interest therein shall be brought in the barangay where the real property is located,” hence, the use of the word “shall” makes it mandatory for the bringing of the dispute before the lupon.           That attorney-in-fact Sagario is a resident of the same barangay as that of hers, respondent argues in any event, brings the matter under the jurisdiction of the lupon, for Sagario, following Section 3 of Rule 3 of the 1997 Rules of Civil Procedure which provides: 

            Sec. 3.  Representative as parties.  -   Where the action is allowed to be prosecuted or defended by a representative or someone acting in a fiduciary capacity, the beneficiary shall be included in the title of the case and shall be deemed to be the real party in interest.  A representative may be a trustee of an express trust, a guardian, an executor or administrator, or a party authorized by law or these Rules.  An agent acting in his own name for the benefit of an undisclosed principal may sue or be sued without joining the principal except when the contract involves things belonging to the principal, 

 being a substitute, becomes the real party-in-interest.           Respondent’s submissions do not lie.           The pertinent provisions of the Local Government Code read:

              SEC. 408.  Subject Matter for Amicable Settlement;  Exception Thereto. –   The lupon of each barangay shall have authority to bring together the parties actually residing in the same city or municipality for amicable settlement of all disputes except:             (a)  Where one party is the government or any subdivision or instrumentality thereof;             (b)  Where one party is a public officer or employee, and the dispute relates to the performance of his official functions;

             (c)  Offenses punishable by imprisonment exceeding one (1) year or a fine exceeding Five Thousand pesos (P5,000.00);             (d)  Offenses where there is no private offended party;             (e)  Where the dispute involves real properties located in different cities or municipalities unless the parties thereto agree to submit their differences to amicable settlement by an appropriate lupon;             (f)  Disputes involving parties who actually reside in barangays of different cities or municipalities, except where such barangay units adjoin each other and the parties thereto agree to submit their differences to amicable settlement by an appropriate lupon;  and                       (g)  Such other classes of disputes which the President may determine in the interest of justice or upon the recommendation of the Secretary of Justice.             The court in which non-criminal cases not falling within the authority of the lupon under this Code are filed may, at any time before trial, motu proprio refer the case to the lupon concerned for amicable settlement.  (Emphasis supplied)             SEC. 409.  Venue.    –   (a)  Disputes between persons actually residing in the same barangay shall be brought for amicable settlement before the lupon of said barangay .             (b)  Those involving actual residents of different barangays within the same city or municipality shall be brought in the barangay where the respondent or any of the respondents actually resides, at the election of the complainant.                        (c)  All disputes involving real property or any interest therein shall be brought in the barangay where the real property or the larger portion thereof is situated. 

            (d)  Those arising at the workplace where the contending parties are employed or at the institution where such parties are enrolled for study shall be brought in the barangay where such workplace or institution is located.             Objections to venue shall be raised in the mediation proceedings before the punong barangay; otherwise, the same shall be deemed waived.  Any legal question which may confront the punong barangay in resolving objections to venue herein referred to may be submitted to the Secretary of Justice or his duly designated representative whose ruling thereon shall be binding.  (Emphasis supplied)

           In the 1982 case of Tavora v. Veloso,[11] this Court held that where the parties are not actual residents in the same city or municipality or adjoining barangays, there is no requirement for them to submit their dispute to the lupon as provided for in Section 6 vis a vis Sections 2 and 3 of P.D. 1508 (Katarungang Pambarangay Law). 

[B]y express statutory inclusion and exclusion, the Lupon shall have no jurisdiction over disputes where the parties are not actual residents of the same city or municipality, except where the barangays in which they actually reside adjoin each other.  (Underscoring supplied) 

           In the 2000 case of Vercide v. Hernandez,[12] this Court, noting that the Tavora ruling, reiterated in other cases including the 1996 case of Agbayani[13] cited by petitioner, was decided under the provisions of P.D. No. 1508 (Katarungang Pambarangay) Law which were, except for some modifications, echoed in Sections 408-409 of the Local Government Code which took effect on January 1, 1992, held that the Tavora ruling remained.           To construe the express statutory requirement of actual residency as applicable to the attorney-in-fact of the party-plaintiff, as contended by respondent, would abrogate the meaning of a “real party in interest” as defined in Section 2 of Rule 3[14] of the 1997 Rules of Court vis a vis Section 3 of the same Rule which was earlier quoted but misread and misunderstood by respondent. 

          In fine, since the plaintiff-herein petitioner, the real party in interest, is not an actual resident of the barangay where the defendant-herein respondent resides, the locallupon has no jurisdiction over their dispute, hence, prior referral to it for conciliation is not a pre-condition to its filing in court.           The RTC thus erred in dismissing petitioner’s complaint.           WHEREFORE, the petition is granted.  The assailed February 10, 2003 Order, as well as the March 24, 2003 Order denying reconsideration of the first, of Branch 23 of the Regional Trial Court of Isabela at Roxas is SET ASIDE.  Said court is accordingly directed to reinstate Civil Case No. 23-713-02 to its docket and take appropriate action thereon with dispatch.

Republic of the PhilippinesSupreme CourtManila THIRD DIVISION   ATTY. EVELYN J. MAGNO,               A.C. No. 6296                         Complainant,         

Present:                                                       

             PANGANIBAN, J., Chairman- versus -                                                                        SANDOVAL-GUTIERREZ,

                                             CORONA,                                                             CARPIO MORALES and                                                             GARCIA, JJ.                                                   ATTY. OLIVIA VELASCO-JACOBA,   Promulgated:                                    Respondent.                November 22, 2005x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x  R E S O L U T I O N  GARCIA, J.:          In her sworn complaint, as endorsed by the President of the Integrated Bar of the Philippines (IBP), Nueva Ecija Chapter, Atty. Evelyn J. Magno charged Atty. Olivia Velasco-Jacoba, a member of the same IBP provincial chapter, with willful violation of (a) Section 415 of the Local Government Code (LGC) of 1991 and (b) Canon 4 of the Code of Professional Responsibility.         This disciplinary case arose out of a disagreement that complainant had with her uncle, Lorenzo Inos, over a landscaping contract they had entered into.  In a bid to have the stand-off between them settled, complainant addressed a letter, styled “Sumbong”,[1]  to Bonifacio Alcantara, barangay captain of Brgy. San Pascual, Talavera, Nueva Ecija. At the barangay conciliation/confrontation proceedings conducted on January 5, 2003, respondent, on the strength of a Special Power of

Attorney signed by Lorenzo Inos, appeared for the latter, accompanied by his son, Lorenzito. Complainant’s objection to respondent’s appearance elicited the response that Lorenzo Inos is entitled to be represented by a lawyer inasmuch as complainant is herself a lawyer. And as to complainant’s retort that her being a lawyer is merely coincidental, respondent countered that she is appearing as an attorney-in-fact, not as counsel, of Lorenzo Inos.           Complainant enumerated specific instances, with supporting documentation, tending to prove that respondent had, in the course of the conciliation proceedings before the Punong Barangay, acted as Inos Lorenzo’s counsel instead of as his attorney-in-fact.  This is what complainant said in her complaint:[2]         

        5. xxx Atty. Olivia Jacoba asked for an ocular inspection of the subject matter of the complaint. A heated argument took place because Lorencito Inos said that [complainant’s brother] Melencio Magno, Jr.  made alterations in the lagoon …. Afterwards Atty. Olivia Jacoba . . . returned to the barangay hall to have the incident recorded in the barangay blotter.... attached as Annex “A”

             6. That on January 12, 2003, … Lorenzo Inos appeared before the hearing also with the assistance of [respondent]. When the  minutes of the proceeding (sic) was read, [respondent] averred that the minutes is partial in favor of the complainant because only her statements were recorded for which reason, marginal insertions were made to include what [respondent] wanted to be put on record. She also signed as “saksi” in the minutes ….

             7.  xxx In a letter (answer to the "sumbong”) sent to the Punong Barangay dated December 22, 2002, she signed representing herself as “Family Legal Counsel of Inos Family”, a copy of the letter is attached as Annex “C” . . . . (Words in bracket added.)

          In an Order dated February 17, 2003, Atty. Victor C. Fernandez, IBP Director for Bar Discipline, directed the respondent to submit, within fifteen (15) days from notice, her answer to the complaint, otherwise she will be considered as in default.[3]

       

        The case, docketed as CBD No. 03-1061, was assigned to Commissioner Rebecca Villanueva-Maala, who admitted respondent’s  answer notwithstanding her earlier order of July 15, 2003, declaring respondent in default for  failure to file an answer in due time.[4]

         In her Answer, respondent alleged that the administrative complaint was filed with the Office of the Punong Barangay,  instead of before the Lupong Tagapamayapa, and heard by Punong Barangay Bonifacio Alcantara alone, instead of the collegial Lupon or a conciliation panel known as pangkat. Prescinding from this premise, respondent submits that the prohibition against a lawyer appearing to assist a client in katarungan pambarangay proceedings does not apply.  Further, she argued that her appearance was not as a lawyer, but only as an attorney-in-fact.            In her report dated October 6, 2003,[5] Commissioner Maala stated that the “charge of complainant has been established by clear preponderance of evidence” and, on that basis, recommended that   respondent be suspended from the practice of her profession for a period of six (6) months. On the other hand, the Board of Governors, IBP Commission on Bar Discipline, while agreeing with the inculpatory finding of the investigating commissioner, recommended in its Resolution No. XVI-2003-235,[6] a lighter penalty, to wit:

              RESOLVED to ADOPT and APPROVE, as it is hereby ADOPTED and APPROVED, the Report and Recommendation of the Investigating Commissioner of the above-entitled case, herein made part of this Resolution/Decision as Annex "A"; and, finding the recommendation fully supported by the evidence on record and the applicable laws and rules, with modification, and considering respondent's actuations was in violation of Section 415 which expressly prohibits the presence and representation by lawyers in the Katarungan Pambarangay, Atty. Olivia Velasco-Jacoba is hereby ADMONISHED.  

        This resolution is now before us for confirmation.         Section 415 of the LGC of 1991[7], on the subject Katarungang Pambarangay, provides:  

            Section 415.  Appearance of Parties in Person. - In all katarungang pambarangay proceedings, the parties must appear in person without the assistance of the counsel or representative, except for minors and incompetents who may be assisted by their next of kin who are not lawyers.

            The above-quoted provision clearly requires the personal appearance of the parties in katarungan pambarangay conciliation proceedings, unassisted by counsel or representative.  The rationale behind the personal appearance requirement is to enable the lupon  to secure first hand and direct information about the facts and issues,[8] the exception being in cases where minors or incompetents are parties. There can be no quibbling that laymen of goodwill can easily agree to conciliate and  settle their disputes between themselves without what sometimes is the unsettling assistance of lawyers whose presence could sometimes obfuscate and confuse issues.[9]  Worse still, the participation of lawyers with their penchant to use their analytical skills and legal knowledge tend to prolong instead of expedite settlement of the case.         The prohibition against the presence of a lawyer in a barangay conciliation proceedings was not, to be sure, lost on respondent. Her defense that the aforequoted Section 415 of the LGC does not apply since complainant addressed her Sumbong to the barangay captain of Brgy. San Pascual who thereafter proceeded to hear the same is specious at best. In this regard, suffice it to state that complainant wrote her Sumbong with the end in view of availing herself of the benefits of barangay justice. That she addressed her Sumbong to the barangay captain is really of little moment since the latter chairs the Lupong Tagapamayapa.[10]          Lest it be overlooked, the prohibition in question applies to all katarungan barangay proceedings.  Section 412(a)[11] the LGC of 1991 clearly provides that, as a precondition to filing a complaint in court, the parties shall go through the conciliation process either before the lupon chairman or the lupon or pangkat.   As what happened in this case, the punong barangay, as chairman of the Lupon Tagapamayapa, conducted the conciliation proceedings to resolve the disputes between the two parties.               Given the above perspective, we join the IBP Commission on Bar Discipline in its determination that respondent transgressed the prohibition prescribed in Section 415 of the LGC. However, its recommended penalty of mere admonition must have to be modified. Doubtless, respondent’s conduct tended to undermine the  laudable purpose of the katarungan pambarangay system. What compounded matters was

when respondent repeatedly ignored complainant’s protestation against her continued appearance in the barangay conciliation proceedings.         WHEREFORE, Atty. Olivia Velasco-Jacoba is hereby FINED in the amount of Five Thousand Pesos (P5,000.00) for willful violation of Section 415 of the Local Government Code of 1991 with WARNING that commission of similar acts of impropriety on her part in the future will be dealt with more severely.         SO ORDERED. 

Republic of the PhilippinesSUPREME COURTManilaEN BANCG.R. No. L-14382           November 29, 1960REMEDIOS CUENCO VDA. DE BORROMEO, petitioner, vs.THE COURT OF APPEALS and TOMAS L. BORROMEO, respondents.M. J. Cuenco, N. R. Pacquiao and J. C. Borromeo for petitioner.Crispin D. Baizas for respondent.PADILLA, J.:Appeal by certiorari under Rule 46 from a judgement of the Court of Appeals(C.A.-G.R. No 22136-R).Remedios Cuenco Borromeo, as administratrix of the estate of the late Teofilo Borromeo, an action against Tomas L. Borromeo in the Court of First Instance of Cebu praying for accounting, liquidation and payment of her late husband's share in the proceeds of the war damage claim paid to and received by the defendant as his attorney-in-fact and of the sum of P17,100 as moral and actual damages and attorney's fees (Civil No. R-5031, Annex A, C.A.-G.R. No. 22136-R). The defendant answered the complaint denying the plaintiffs claim and averring that such share has been fully paid to Teofilo Borromeo (Annex B, C.A.-G.R. No. 22136-R). Aside from this case, they were pending in the same Court Civil No. R-3808, entitled "Estate of Vito Borromeo vs. Tomas Borromeo," and special proceedings No. R-916, entitled "Testate Estate of the Vito Borromeo." For the convenience of Attorney Crispin D. Baizas, counsel for Tomas L. Borromeo in Civil No. R. 5031 and special proceedings was set by the Court to enable attorney Baizas to be in Cebu City on consecutive days. The hearing of Civil No. R-916 for 10, 11 and 12 July 1957. On 8 July 1957 Attorney Baizas received by mail a copy of an urgent motion dated 5 July 1957 of the Solicitor General, who represented the Government in the special proceedings, praying for postponement of the hearing set for 10, 11 and 12 July 1957 (Annex C, C.A.-G.R. No. 22136-R). Attorney Baizas, who had previously made reservation with the Philippine Air Lines to fly to Cebu City, cancelled his reservation and wired Attorney Filberto Leonardo (who was collaborating with him in handling the cases) in Cebu City, requesting him to ask for postponement of the hearing of Civil No. R-5031, which he referred to in the telegram as the "Cuenco Case," or, should the Court deny his request, to appear in his behalf at the trial of the case. On 9 July, Attorney Leonardo, believing that the "Cuenco Case" referred to by Attorney Baizas in his telegram was Civil No. R-3808, was proceeded to the Court presided over by Hon. Edmundo Piccio but after reading the court calendar found that Civil No. R-3808 was not set for hearing on that day. So he went home. For that

reason, when Civil No. R-5031 was called for hearing at the Court presided over by Hon. Jose S. Rodriguez, neither the defendant Tomas L. Borromeo nor his counsel appeared, and the plaintiff Remedios Cuenco Borromeo was allowed to present her evidence. On 11 July 1957 the Court rendered judgment for the plaintiff and against the defendant, copy of which was received by counsel for the defendant on 2 August 1957 (Annex B, C.A.-G.R. No. 22136). On 29 August 1957 the defendant filed a verified motion for new trial, dated 26 August 1957, on the ground of mistake or excusable neglect, supported by affidavits of merit attached thereto (Annexes B, E-1 and E-2, C.A.-G.R. No. 22136). On 23 September 1957. On 17 October 1957, or 24 days after receipt of a copy of the order denying his motion for new trial, the defendant perfected his appeal from the last mentioned order. In a motion dated 21 October 1957, copy of which counsel for the defendant received on 26 October 1957, the plaintiff prayed for dismissal of the appeal on the ground that it was filed beyond the reglementary period (Annex H, C.A.-G.R. No. 22136). On 29 October 1957 the defendant filed an objection thereto stating that he was appealing from the order dated 13 September 1957 denying his motion for new trial, and not from the judgment dated 11 July 1957 (Annex I, C.A.-G.R. No. 22136). The Court set the hearing of the plaintiff's motion to dismiss on 26 October 1957 and thereafter on the same day entered an order as follows:

Finding the motion of counsel for the plaintiff dated October 21, 1957, well founded, it appearing that the appeal filed by the defendant was presented outside of the 30 day period for appeal, it was filed after 44th day as shown by the records, as prayed for, the appeal filed by the defendant is hereby DISMISSED (Annex J, C.A.-G.R. No. 22136).

On 6 November 1957 the defendant moved for reconsideration of the foregoing order, reiterating that his appeal was from the order dated 13 September 1957 denying his motion for new trial and not from the judgment dated 11 July 1957 (Annex K, C.A.-G.R. No. 22136); the plaintiff, an objection thereto(Annex L, C.A.-G.R. No. 22136). On 2 December 1957 the defendant received a copy of an order dated 25 November 1957 denying the motion for reconsideration (Annex M, C.A.-G.R. No. 22136); on 23 December 1959 the defendant filed a petition for a writ of certiorari in the Court of Appeals praying that after hearing the order dated 26 October 1957 dismissing his appeal from the denial of his motion of new trial be set aside. (C.A.-G.R. No. 22136). He also prayed that after filing the requisite bond, a writ of preliminary injunction be issued enjoining the respondent court from issuing a writ of execution of the judgment rendered in Civil No. R-5031. After he had posted a bond in the sum of P1,000, the Court of Appeals issued a writ of preliminary injunction prayed for. On 28 February 1958 the Court of Appeals rendered judgment, the dispositive part of which is:

IN VIEW OF THE FOREGOING, the judgment rendered in Civil Case No. 5031, set aside, and the respondent judge should be, as he is hereby ordered, to grant the NEW TRIAL prayed for and permit the petitioner to present such evidence as may be lawfully warranted and relevant in the premises. The injunction issued heretofore, is made permanent, without special pronouncement as to costs.

The herein respondent, petitioner in the Court of Appeals, insists the he is appealing from the order dated 13 September 1957, denying his motion for new trial and not from the judgement dated 11 July 1957.Taking into consideration the facts set forth in the motion for new trial supported by affidavits attached thereto and the answer filed by the herein respondent Tomas L. Borromeo in the Court of First Instance of Cebu where he denies the claim of the herein petitioner, plaintiff in the said Court, and avers that the claim for war damage of the late Teofilo Borromeo, husband of the herein petitioner, has been fully paid to him, said motion may be deemed one filed under Rule 38, of the Rules of Court. A denial thereof is final and appealable. The period for taking an appeal from a denial of a motion praying for the setting aside of a judgment or order rendered or entered against a party through fraud, accident, mistake, or excusable negligence is thirty days from the receipt of the copy of such judgment or order. Indeed, it would be futile to appeal from the judgment sought to be set aside by a motion or relief under Rule 38, because the aggrieved party would have no evidence upon which to rely to secure a reversal of the judgment sought to be set aside by a motion for relief under Rule 38, unless he would rely for its reversal on insufficiency or perhaps inherent improbability of the evidence presented by the winning party. The appeal by the herein respondent Tomas L. Borromeo from the order denying his motion for relief had been taken within the reglementary period and should have been allowed.The judgment rendered by the Court of Appeals under review granting the writ prayed for by the herein respondent Tomas L. Borromeo should be, as it is hereby, affirmed, with costs against the herein petitioner Remedios Cuenco Vda. de Borromeo.Paras, C.J., Bengzon, Bautista Angelo, Labrador, Concepcion, Reyes, J.B.L., Barrera, Gutierrez David, Paredes, and Dizon, JJ., concur.

EDWIN N. TRIBIANA, petitioner, vs. LOURDES M. TRIBIANA, respondent.D E C I S I O NCARPIO, J.:The Case

This petition for review on certiorari[1] seeks to reverse the Court of Appeals’ Resolutions[2] dated 2 July 1998 and 18 January 1999 in CA-G.R. SP No. 48049. The Court of Appeals affirmed the Order[3] of the Regional Trial Court, Branch 19, Bacoor, Cavite (“RTC”), denying petitioner Edwin N. Tribiana’s (“Edwin”) motion to dismiss the petition for habeas corpus filed against him by respondent Lourdes Tribiana (“Lourdes”).Antecedent Facts

Edwin and Lourdes are husband and wife who have lived together since 1996 but formalized their union only on 28 October 1997. On 30 April 1998, Lourdes filed a petition for habeas corpus before the RTC claiming that Edwin left their conjugal home with their daughter, Khriza Mae Tribiana (“Khriza”). Edwin has since deprived Lourdes of lawful custody of Khriza who was then only one (1) year and four (4) months of age.  Later, it turned out that Khriza was being held by Edwin’s mother, Rosalina Tribiana (“Rosalina”). Edwin moved to dismiss Lourdes’ petition on the ground that the petition failed to allege that earnest efforts at a compromise were made before its filing as required by Article 151 of the Family Code.

On 20 May 1998, Lourdes filed her opposition to Edwin’s motion to dismiss claiming that there were prior efforts at a compromise, which failed. Lourdes attached to her opposition a copy of the Certification to File Action from their Barangay dated 1 May 1998.

On 18 May 1998, the RTC denied Edwin’s motion to dismiss and reiterated a previous order requiring Edwin and his mother, Rosalina to bring Khriza before the RTC. Upon denial of his motion for reconsideration, Edwin filed with the Court of Appeals a petition for prohibition and certiorari under Rule 65 of the Rules of Civil Procedure.  The appellate court denied Edwin’s petition on 2 July 1998.  The appellate court also denied Edwin’s motion for reconsideration.

Hence, this petition.The Rulings of the RTC and the Court of Appeals

The RTC denied Edwin’s motion to dismiss on the ground that the Certification to File Action attached by Lourdes to her opposition clearly indicates that the parties attempted to reach a compromise but failed.

The Court of Appeals upheld the ruling of the RTC and added that under Section 412 (b) (2) of the Local Government Code, conciliation proceedings before the barangay are not required in petitions for habeas corpus.The Issue

Edwin seeks a reversal and raises the following issue for resolution:

WHETHER THE TRIAL AND APPELLATE COURTS SHOULD HAVE DISMISSED THE PETITION FOR HABEAS CORPUS ON THE GROUND OF FAILURE TO COMPLY WITH THE CONDITION PRECEDENT UNDER ARTICLE 151 OF THE FAMILY CODE.

The Ruling of the CourtThe petition lacks merit.Edwin argues that Lourdes’ failure to indicate in her petition for habeas

corpus that the parties exerted prior efforts to reach a compromise and that such efforts failed is a ground for the petition’s dismissal under Section 1(j), Rule 16 of the 1997 Rules of Civil Procedure.[4] Edwin maintains that under Article 151 of the Family Code, an earnest effort to reach a compromise is an indispensable condition precedent.  Article 151 provides:No suit between members of the same family shall prosper unless it should appear from the verified complaint or petition that earnest efforts toward a compromise have been made, but that the same have failed. If it is shown that no such efforts were in fact made, the case must be dismissed.This rule shall not apply to cases which may not be the subject of compromise under the Civil Code.

Edwin’s arguments do not persuade us.It is true that the petition for habeas corpus filed by Lourdes failed to allege

that she resorted to compromise proceedings before filing the petition. However, in her opposition to Edwin’s motion to dismiss, Lourdes attached a Barangay Certification to File Action dated 1 May 1998.  Edwin does not dispute the authenticity of the Barangay Certification and its contents.  This effectively established that the parties tried to compromise but were unsuccessful in their efforts.  However, Edwin would have the petition dismissed despite the existence of the Barangay Certification, which he does not even dispute.

Evidently, Lourdes has complied with the condition precedent under Article 151 of the Family Code.   A dismissal under Section 1(j) of Rule 16 is warranted only if there is a failure to comply with a condition precedent. Given that the alleged defect is a mere failure to allege compliance with a condition precedent, the proper solution is not an outright dismissal of the action, but an amendment under Section 1 of Rule 10 of the 1997 Rules of Civil Procedure. [5] It would have been a different matter if Edwin had asserted that no efforts to arrive at a compromise have been made at all.

In addition, the failure of a party to comply with a condition precedent is not a jurisdictional defect.[6] Such defect does not place the controversy beyond the court’s power to resolve.  If a party fails to raise such defect in a motion to dismiss, such defect is deemed waived.[7] Such defect is curable by amendment as a matter of right without leave of court, if made before the filing of a responsive pleading.[8] A motion

to dismiss is not a responsive pleading.[9] More importantly, an amendment alleging compliance with a condition precedent is not a jurisdictional matter.  Neither does it alter the cause of action of a petition for habeas corpus.  We have held that in cases where the defect consists of the failure to state compliance with a condition precedent, the trial court should order the amendment of the complaint. [10] Courts should be liberal in allowing amendments to pleadings to avoid multiplicity of suits and to present the real controversies between the parties.[11]

Moreover, in a habeas corpus proceeding involving the welfare and custody of a child of tender age, the paramount concern is to resolve immediately the issue of who has legal custody of the child.  Technicalities should not stand in the way of giving such child of tender age full protection.[12] This rule has sound statutory basis in Article 213 of the Family Code, which states, “No child under seven years of age shall be separated from the mother unless the court finds compelling reasons to order otherwise.”  In this case, the child (Khriza) was only one year and four months when taken away from the mother.

The Court of Appeals dismissed Edwin’s contentions by citing as an additional ground the exception in Section 412 (b) (2) of the Local Government Code (“LGC”) on barangay conciliation, which states:(b) Where the parties may go directly to court. – the parties may go directly to court in the following instances:xxx

2) Where a person has otherwise been deprived of personal liberty  calling for habeas corpus proceedings;

xxx.Under Rule 102 of the 1997 Rules of Civil Procedure, a party may resort to a  habeas corpus proceeding in two instances.  The first is when any person is deprived of liberty either through illegal confinement or through detention.  The second instance is when custody of any person is withheld from the person entitled to such custody.  The most common case falling under the second instance involves children who are taken away from a parent by another parent or by a relative.  The case filed by Lourdes falls under this category.

The barangay conciliation requirement in Section 412 of the LGC does not apply to habeas corpus proceedings where a person is “deprived of personal liberty.” In such a case, Section 412 expressly authorizes the parties “to go directly to court” without need of any conciliation proceedings.  There is deprivation of personal liberty warranting a petition for habeas corpuswhere the “rightful custody of any person is withheld from the person entitled thereto.”[13] Thus, the Court of Appeals did not err when it dismissed Edwin’s contentions on the additional ground that Section 412 exempts petitions for habeas corpus from the barangay conciliation requirement.

The petition for certiorari filed by Edwin questioning the RTC’s denial of his motion to dismiss merely states a blanket allegation of “grave abuse of discretion.”   An order denying a motion to dismiss is interlocutory and is not a proper subject of a petition for certiorari.[14] Even in the face of an error of judgment on the part of a judge denying the motion to dismiss, certiorari will not lie. Certiorari is not a remedy to correct errors of procedure.[15] The proper remedy against an order denying a motion to dismiss is to file an answer and interpose as affirmative defenses the objections raised in the motion to dismiss.  It is only in the presence of extraordinary circumstances evincing a patent disregard of justice and fair play where resort to a petition for certiorari is proper.[16]

The litigation of substantive issues must not rest on a prolonged contest on technicalities.  This is precisely what has happened in this case.  The circumstances are devoid of any hint of the slightest abuse of discretion by the RTC or the Court of Appeals.  A party must not be allowed to delay litigation by the sheer expediency of filing a petition for certiorari under Rule 65 based on scant allegations of grave abuse.  More importantly, any matter involving the custody of a child of tender age deserves immediate resolution to protect the child’s welfare.

WHEREFORE, we DISMISS the instant petition for lack of merit. We AFFIRM the Resolutions of the Court of Appeals dated 2 July 1998 and 18 January 1999 in CA-G.R. SP No. 48049.  The Regional Trial Court, Branch 19, Bacoor, Cavite is ordered to act with dispatch in resolving the petition for habeas corpus pending before it.  This decision is IMMEDIATELY EXECUTORY.

SO ORDERED.Davide, Jr., C.J., (Chairman), Quisumbing, Ynares-Santiago, and Azcuna,

JJ., concur.

 SECOND DIVISION  ESTELA L. BERBA,                                 G.R. No. 160032

Petitioner,                                      Present:

                                                                                                     PUNO, J., Chairman,

                                                               AUSTRIA-MARTINEZ,             -    versus    -                                           CALLEJO, SR.,                                                                        TINGA, and

                        CHICO-NAZARIO,* JJ.  JOSEPHINE PABLO and THE               Promulgated:HEIRS OF CARLOS PALANCA,

Respondents.                       November 11, 2005x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -  - - - - - - - - - - - - - - x D E C I S I O N  CALLEJO, SR., J.:            Assailed before the Court on a petition for review on certiorari is the Decision[1] of the Court of Appeals (CA) in CA-G.R. SP No. 73531, affirming the Decision[2] of the Regional Trial Court (RTC) of Manila in Civil Case No. 170639.           Estela L. Berba, a resident of 978 Maligaya Street, Malate, Manila, was the owner of a parcel of land located at No. 2338 M. Roxas Street, Sta. Ana, Manila covered by Transfer Certificate of Title (TCT) No. 63726. A house was constructed on the lot, which she leased to Josephine Pablo* and the Heirs of Carlos Palanca sometime in 1976. The lease was covered by a lease contract. Upon its expiration, the lessees continued leasing the house on a month-to-month basis.  

By 1999, the monthly rental on the property was P3,450.00.  The lessees failed to pay the rentals due, and by May 1999, their arrears amounted to P81,818.00.  Berba then filed a complaint for eviction and collection of unpaid

rentals only against Pablo in the Office of the Punong Barangay.  On June 5, 1999, Berba and Pablo executed an Agreement approved by the pangkat, as follows: 

            Ako si Josephine Pablo, naninirahan sa 2338 M. Roxas St., Sta. Ana, Manila, na nasasakop ng Barangay 873, Zone 96, ay nangangako kay GG Robert Berba na nagmamay-ari ng aking tinitirahan ay maghuhulog ng halagang Tatlong Libong Piso P3,000.00 kada ika-sampu ng buwan bilang hulog sa aking pagkakautang kay GG Berba na umaabot sa halagangP81,818.00 na ang nasabing halagang ito ay aking huhulugan hanggang aking mabayaran ng buo ang aking pagkakautang.  Ako rin, si Josephine Pablo, ay nangangako na ang hindi ko pagsunod o pagbayad ng buwanang hulog, ako ay kusang aalis sa aking tinitirahan.  Bukod pa sa hulog sa aking pagkakautang, ako rin ay magbabayad ng halagang P3,450.00 bilang aking upa sa aking tinitirahan.[3]

           By May 2000, Pablo and the lessees still had a balance of P71,716.00.  As of May 1, 2001, the total arrearages of the lessees amounted to P135,115.63.[4]  On May 2, 2001, Berba, through counsel, wrote the lessees, demanding payment of the said amount and to vacate the house within 30 days from notice, otherwise she will sue them.[5]  The lessees ignored the demand.  On June 21, 2001, Berba filed a complaint[6] against Josephine Pablo and the Heirs of Carlos Palanca in the Metropolitan Trial Court (MTC) of Manila for unlawful detainer.  She prayed that, after due proceedings, judgment be rendered in her favor:

           WHEREFORE, it is most respectfully prayed for that

judgment be rendered in favor of plaintiff ordering defendant (sic) – 

a)    to vacate the premises situated at 2338 M. Roxas Street, Sta. Ana, City of Manila;

b)    to pay plaintiff the sum of One Hundred Thirty-Five Thousand One Hundred Fifteen and 63/100 Pesos (P135,115.63) representing monthly rentals in arrears to the present;

c)    to pay plaintiff the amount of Four Thousand Five Hundred Sixty-Two and 63/100 Pesos (P4,562.63) per month

representing monthly rent on the premises for the year 2001 until finality of the judgment;

d)    to pay plaintiff the sum of Twenty Thousand Pesos (P20,000.00) by way of attorney’s fees;

e)    to reimburse plaintiff all expenses for litigation estimated in the amount of Ten Thousand Pesos;

f)     to pay costs of suit.             Other reliefs just and equitable are, likewise, prayed for under the premises.[7]

  

          Berba, however, failed to append to her complaint a certification from the Lupon ng Tagapamayapa  that no conciliation or settlement had been reached.  

In their answer to the complaint, the defendants admitted to have stopped paying rentals because of financial distress. They also alleged that they were not certain if the plaintiff was the owner of the property.  By way of special and affirmative defenses, they averred that the plaintiff had no cause of action against them as she failed to secure a Certificate to File Action from the Lupon.[8] 

 During the pre-trial conference, the parties manifested to the court that,

despite earnest efforts, no amicable settlement was reached.  They defined the main issue as whether or not the plaintiff had a valid cause of action for unlawful detainer against the defendants.[9]

           In her position paper, Berba appended an Agreement dated June 5, 1999 between her and Pablo, which appeared to have been approved by Punong Barangay Cayetano L. Gonzales of Barangay 873, as well as other members of the Lupon,[10] duly approved by the Pangkat. She also appended a Statement of Account indicating that the defendants’ back rentals amounted to P135,115.63.[11]  

In their position paper, the defendants insisted that the dispute did not go through the Lupon  ng Tagapamayapa prior to the filing of the complaint; hence, Berba’s complaint was premature. They also averred that the increase in the rental rates imposed by the plaintiff was unjustified and illegal. 

 

In her reply, the plaintiff alleged that there was no more need for her to secure a Certificate to File Action because she was a resident of No. 978 Maligaya Street, Malate, Manila, while the defendants were residing in Barangay   873, Zone 6 in Sta. Ana, Manila.            On March 14, 2002, the MTC rendered judgment in favor of Berba.  The fallo of the decision reads: 

            WHEREFORE, judgment is rendered in favor of the plaintiff and ordering the defendants and all persons claiming rights under them to vacate the premises at 2338 M. Roxas St., Sta. Ana, Manila and restore possession thereof to the plaintiff.  Ordering the defendant to pay the amount of P135,115.63 representing monthly rentals since 1999 until December 2000.  Ordering the defendant to pay the plaintiff the sum of P4,562.63 per month beginning January 2001 and for the succeeding months until finally vacated. Ordering the defendant to pay the reduced amount of P10,000.00 as attorney’s fees plus the costs of suit.             SO ORDERED.[12]

           The defendants appealed the decision to the RTC. On motion of the plaintiff, the RTC issued an order for the execution of the decision pending appeal. [13] The defendants filed a motion for the recall of the Order,[14] but before the court could resolve the motion, the Sheriff turned over the physical possession of the property to Berba on May 20, 2002.[15]            In their Appeal Memorandum, Pablo and the heirs of Palanca insisted that Berba’s action in the MTC was premature because of the absence of  Certificate to File Action issued by the Lupon. They also claimed that Berba unlawfully increased the rentals for the house.[16] Berba, on the other hand, averred that there was no need of a prior referral to the Lupon before filing her complaint. The petitioner cited Section 408(f) of the Local Government Code, pointing out that she resided in a Barangay in Malate, 8 kilometers away from Barangay 873  in Sta. Ana, where Pablo and the Palanca heirs resided.[17]

           On August 20, 2002, the RTC rendered judgment granting the appeal and setting aside the appealed decision.  The fallo of the decision reads: 

WHEREFORE, the decision of the Court a quo  is ordered set aside. The complaint is also ordered DISMISSED WITHOUT PREJUDICE. The Writ of Execution issued by the Court a quo pending appeal is also set aside.

             SO ORDERED.[18]

 The RTC ruled that under Section 408 of the Local Government Code,

parties who reside in the same city or municipality although in different barangays are mandated to go through conciliation proceedings in the Lupon.[19]  The court cited the rulings of this Court in Morata v. Go,[20] and Vda. de Borromeo v. Pogoy.[21]            Berba filed a motion for the reconsideration[22] of the decision, which the RTC denied in its Order[23] dated October 2, 2002. She then elevated the case to the CA viapetition for review, where she averred: 

a)    The raising of other affirmative defenses apart from the non-referral to the Barangay Court by the respondents constitute a waiver of such requirement; and

 b)    There was substantial compliance on the part of the petitioner

with respect to referring her complaint before the Barangay Court.[24]

           Citing the ruling of this Court in Diu v. Court of Appeals,[25] Berba claimed that Section 408 of the Local Government Code should be construed liberally together with Section 412.  She further averred that she had complied substantially with the requisites of the law, and recalls that conciliation proceedings before the Lupon resulted in the execution of an Agreement on June 5, 1999.  Upon failure to comply with the agreement, all chances of amicable settlement were effectively foreclosed.  Hence, Pablo and the Heirs of Palanca were estopped from claiming that she failed to comply with the Local Government Code’s requirement of prior referral of their dispute to the Lupon. 

After due proceedings, the CA rendered judgment dismissing the petition and affirming the RTC decision. Berba moved for a reconsideration of the decision, which proved futile. 

 In the instant petition for review on certiorari, the petitioner alleges that:

THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED WHEN IT FAILED TO CONSIDER THE DECISION OF THIS HONORABLE COURT IN THE CASE OF DIU VS. COURT OF APPEALS (251 SCRA 478) AND IN DECLARING THAT THERE WAS NO SUBSTANTIAL COMPLIANCE WITH THE MANDATE OF PD 1508 (NOW R.A. 7160) WITH RESPECT TO PRIOR REFERRAL TO THE BARANGAY COURT, THEREBY DECIDING THE CASE NOT IN ACCORD WITH LAW AND APPLICABLE DECISIONS OF THE COURT.[26]

         The petitioner avers that she is a sickly widow, in the twilight of her years,

and whose only source of income are the rentals generated from the property, which she also uses to pay her medical expenses.  She avers that the continued denial of her right to the fruits of the subject property is highly unjust and contrary to the spirit behind the enactment of Presidential Decree (P.D.) No. 1508.[27]

 The petitioner also points out that, for her to pay obeisance to the decision

of the CA, she would have to go through the tedious, not to mention horrendous, process of going back to square one; that is, referring the dispute to the barangay which, in all likelihood, would be rendered useless considering that respondents had already been validly and effectively ejected from the leased premises.  She would then have to go through the rungs of the judicial ladder a second time to vindicate her trampled rights. She further claims that the CA’s affirmation of the RTC decision is equivalent to sanctioning a “legal anomaly.”  She points out that the very purpose of barangay conciliation is to abbreviate disputes between members of the same or adjacent barangays to the end that their disputes will not reach the doors of the courts.  Clearly, it does not contemplate a protracted process as suggested by the RTC ruling and affirmed by the CA.[28]

 In their comment on the petition, the respondents aver that the petitioner

was estopped from relying on the June 5, 1999 Agreement between her and respondent Josephine Pablo before the Lupon because the respondent Heirs of Carlos Palanca were not parties thereto. The respondents maintained that the petitioner must bear the blame for her failure to comply with the Local Government Code. At first, she insisted that there was no need for prior referral of the dispute to the Lupon, claiming that she resided in abarangay other than where the respondents resided. Thereafter, she made a volte face and invoked the June 5, 1999 Agreement between her and respondent Josephine Pablo. Moreover, the respondents aver, the MTC had no jurisdiction over the petitioner’s action for unlawful detainer because it

was filed only on June 21, 2001, or more than one year from June 5, 1999 when the petitioner and respondent Josephine Pablo executed the agreement. As such, the action should be one for recovery of possession of property (accion publiciana). 

 On June 2, 2004, the Court resolved to give due course to the petition and

required the parties to file their respective memoranda.[29] The parties complied. The Court rules that the CA cannot be faulted for affirming the decision of

the RTC reversing the decision of the MTC and ordering the dismissal of the complaint for unlawful detainer without prejudice.           The records show that petitioner and respondent Josephine Pablo executed an Agreement on June 5, 1999, which was approved by the Lupon.   Respondent Josephine Pablo did not repudiate the agreement; hence, such agreement of the parties settling the case had the force and effect of a final judgment. As the Court declared in Vidal v. Escueta,[30] the settlement of the parties may be enforced by the Lupon, through the punong barangay, within 

six months; and if the settlement is not enforced after the lapse of said period, it may be enforced by an action in the proper city or municipal court, as provided in Section 417 of the Local Government Code:

 We also agree that the Secretary of the Lupon  is

mandated to transmit the settlement to the appropriate city or municipal court within the time frame under Section 418 of the LGC and to furnish the parties and the Lupon Chairman with copies thereof. The amicable settlement which is not repudiated within the period therefor may be enforced by execution by the Luponthrough the Punong Barangay within a time line of six months, and if the settlement is not so enforced by the Lupon after the lapse of said period, it may be enforced only by an action in the proper city or municipal court as provided for in Section 417 of the LGC of 1991, as amended, which reads:

 SEC. 417. Execution. – The amicable

settlement or arbitration award may be enforced by execution by the Lupon within six (6) months from the date of the settlement. After the lapse of such time, the settlement may be enforced by action in the proper city or municipal court. (Italics supplied).

 Section 417 of the Local Government Code provides a

mechanism for the enforcement of a settlement of the parties before the Lupon. It provides for a two-tiered mode of enforcement of an amicable settlement executed by the parties before the Lupon, namely, (a) by execution of the Punong Barangay which is quasi-judicial and summary in nature on mere motion of the party/parties entitled thereto; and (b) by an action in regular form, which remedy is judicial. Under the first remedy, the proceedings are covered by the LGC and the Katarungang Pambarangay Implementing Rules and Regulations.  The Punong Barangay  is called upon during the hearing to determine solely the fact of non-compliance of the terms of the settlement and to give the defaulting party another chance at voluntarily complying with his obligation under the settlement.  Under the second remedy, the proceedings are governed by the Rules of Court, as amended.  The cause of action is the amicable settlement itself, which, by operation of law, has the force and effect of a final judgment.

 Section 417 of the LGC grants a period of six months to

enforce the amicable settlement by the Lupon  through the Punong Barangay before such party may resort to filing an action with the MTC to enforce the settlement.  The raison d’etre of the law is to afford the parties during the six-month time line, a simple, speedy and less expensive enforcement of their settlement before the Lupon.[31]      

  

          In the present case, respondent Josephine Pablo failed to comply with her obligation of repaying the back rentals of P81,818.00 and the current rentals for the house.  Hence, the petitioner had the right to enforce the Agreement against her and move for her eviction from the premises. However, instead of filing a motion before the Lupon for the enforcement of the agreement, or (after six months), an action in the Metropolitan Trial Court (MTC) for the enforcement of the settlement, the petitioner filed an action against respondent Josephine Pablo for unlawful detainer and the collection of unpaid rentals, inclusive of those already due before the June 5, 1999 Agreement was executed. The action of the petitioner against respondent Pablo was barred by the Agreement of June 5, 1999.           The Court notes that the petitioner even submitted with the MTC a copy of her June 5, 1999 Agreement with respondent Josephine Pablo.  Instead of dismissing the complaint as against such respondent, the MTC rendered judgment against her and ordered her eviction from the leased premises. 

The Court thus rules that the petitioner’s complaint against respondent Heirs of Carlos Palanca was premature. It bears stressing that they were not impleaded by the petitioner as parties-respondents before the Lupon. The petitioner filed her complaint solely against respondent Josephine Pablo.  Moreover, the said respondent heirs were not privy to the said agreement, and, as such, were not bound by it. Section 412 of the Local Government Code, sets forth the precondition to filing of complaints in court, to wit: 

SEC. 412 Conciliation.- (a) Pre-condition to filing of complaint in court. – No complaint, petition, action, or proceeding involving any matter within the authority of the lupon shall be filed or instituted directly in court or any other government office for adjudication, unless there has been a confrontation between the parties before the lupon chairman or the pangkat, and that no

conciliation or settlement has been reached as  certified by the lupon secretary or pangkat secretary as attested to by the lupon chairman or pangkat chairman or unless the settlement has been repudiated by the parties thereto.

 (b) Where parties may go directly to court. – The parties

may go directly to court in the following instances: (1) Where the accused is under detention; (2) Where a person has otherwise been deprived of

personal liberty calling for habeas corpus proceedings; (3) Where actions are coupled with provisional remedies

such as preliminary injunction, attachment, delivery of personal property, and support pendente lite; and

 (4) Where the action may otherwise be barred by the

statute of limitations. (c) Conciliation among members of indigenous cultural

communities. – The customs and traditions of indigenous cultural communities shall be applied in settling disputes between members of the cultural communities. 

 Under Sec. 408 of the same Code, parties actually residing in the same city

or municipality are bound to submit their disputes to the Lupon for conciliation/amicable settlement, unless otherwise provided therein:

             SEC. 408. Subject Matter for Amicable Settlement; Exception Thereto. – The lupon of each barangay shall have authority to bring together the parties actually residing in the same city or municipality for amicable settlement of all disputes except: 

(a)    Where one party is the government or any subdivision or instrumentality thereof; 

(b) Where one party is a public officer or employee, and the dispute relates to the performance of his official functions;  

 (c)  Offenses punishable by imprisonment exceeding one

(1) year or a fine exceeding Five Thousand pesos (P5,000.00);       

(d)   Offenses where there is no private offended party; 

(e)  Where the dispute involves real properties located in different cities or municipalities unless the parties thereto agree to submit their differences to amicable settlement by an appropriate lupon; 

(f)   Disputes involving parties who actually reside in barangays of different cities or municipalities, except where such barangay units adjoin each other and the parties thereto agree to submit their differences to amicable settlement by an appropriate lupon; 

(g)   Such other classes of disputes which the President may determine in the interest of justice or upon the recommendation of the Secretary of Justice. 

The court in which non-criminal cases not falling within the authority of the lupon under this Code are filed may, at any time before trial, motu proprio refer the case to the luponconcerned for amicable settlement.

  

If the complainant/plaintiff fails to comply with the requirements of the Local Government Code, such complaint filed with the court may be dismissed for failure to exhaust all administrative remedies.[32]

 The petitioner’s reliance on the ruling of this Court in Diu v. Court of

Appeals[33]  is misplaced.  In that case, there was a confrontation by the parties before the BarangayChairman and no agreement was reached.  Although no pangkat was formed, the Court held in that instance that there was substantial compliance with the law.  In any event, the issue in that case was whether the failure to specifically allege that there was no compliance with the barangay conciliation procedure constitutes a waiver of that defense.  Moreover, no such confrontation before the Lupon occurred with respect to the unlawful detainer suit against Josephine Pablo before the MTC.[34]

 

In this case, the petitioner and the respondent Heirs of Carlos Palanca resided in the City of Manila, albeit  in different barangays.  The dispute between the petitioner and the respondent heirs was thus a matter within the authority of the Lupon. Hence, the petitioner’s complaint for unlawful detainer and the collection of back rentals should have been first filed before 

the Lupon for mandatory conciliation, to afford the parties an opportunity to settle the case amicably.  However, the petitioner filed her complaint against the respondent Heirs of Carlos Palanca directly with the MTC.  Clearly then, her complaint was premature.  The execution of the June 5, 1999 Agreement between petitioner and respondent Josephine Pablo does not amount to substantial compliance to the requirements of the Local Government Code on mandatory barangay conciliation proceedings.

 Indeed, considering that the MTC had already rendered a decision on the

merits of the case, it is not without reluctance that the Court reaches this conclusion which would require the petitioner to start again from the beginning. The facts of the present case, however, do not leave us any choice. To grant the petition under these circumstances would amount to refusal to give effect to the Local Government Code and to wiping it off the statute books insofar as ejectment and other cases governed by the Rule on Summary Procedure are concerned. This Court has no authority to do that.[35]

 IN LIGHT OF ALL THE FOREGOING, the Petition is DENIED. SO ORDERED.