1. Heirs of Conahap vs.

Regaña, 458 SCRA 741,748, Pre-trial Order

G.R. No. 152021. May 17, 2005
CALLEJO, SR., J.:

FACTS:
 Sometime in August 1983, the spouses Prosperador and Milagros Regana, who had first returned to the Philippines
from Nigeria, agreed to purchase a parcel of land in Davao City.
 It was owned by Ecoland Properties Development Corporation (Ecoland).
o the agreed price was P56,270.00, with a down payment of P3,000.00 upon the execution of the contract to
sell.
o the balance payable on or before September 30, 1983.
 Project Engineer Romel Bernardino accompanied Prosperador Regana to the property which was then unoccupied.
 Bernardino also showed a sketch plan indicating its location.
 On August 22, 1983, Ecoland and Prosperador Regana executed a Contract To Sell over the property.
o The purchase price was paid, and the Register of Deeds thereafter issued Transfer Certificate of Title (TCT)
No. T-101822 under Prosperadors name.
 The Regana spouses then left the Philippines and returned to Nigeria where they were employed.
 Upon their return to the Philippines in 1984, the couple visited the property and found it unoccupied.
 They placed a temporary fence around its perimeter, as well as a No Trespassing sign.
 They then left for Surigao where Milagros was then working.
 Upon their return to Matina, Davao City in March 1988, they were dumbfounded to see that a house already
stood on their property that of Ernesto Conahap who, together with his family, was already residing therein.
 Prosperador then filed a complaint for ejectment against Ernesto with the Office of the Barangay Captain,
Bucana, Davao City.
o The parties failed to arrive at a settlement.
 Prosperador Regana then filed a complaint for recovery of possession of the said property with the Regional Trial
Court (RTC) of Davao City.
 During the pre-trial, Ernesto admitted that the spouses Regana had purchased the property from Ecoland, and
that it was titled in their names.
o For his part, Prosperador admitted that the property was covered by Poncianos homestead patent
application which was filed with the Bureau of Lands in 1982.
o Feliciano testified further that there was no No Trespassing sign installed on the property, nor any fence
constructed around its perimeter.
o Ernesto further alleged that although the Bureau of Lands had not approved Poncianos free patent
application, the property occupied by him was not a part of Ecolands property, as evidenced by the resurvey
of the property titled to the latter.
 The trial court Ordered defendant, his privies, agents, and representatives to vacate the land in question, demolish
his structure, and turn possession thereof to the plaintiff;
o Ordering defendant to pay rentals on the premises at the rate of five hundred (P500.00) pesos a month
counted from January 1988 until possession thereof is restored to the plaintiff.
 Ernesto appealed the decision to the Court of Appeals (CA), which affirmed the decision on December 26, 2000.
 A motion for reconsideration thereof was likewise filed, and was similarly denied.
o The appellate court ruled that Ernesto failed to prove that the property occupied by him and his family was
a portion of the property subject of Poncianos free patent application.
 In the meantime, Ernesto died and was survived by his heirs, Nerre D. Gancino-Conahap, Farrah May Gancino
Conahap and Melanie Gancino Conahap, who now assail the appellate courts decision and resolution through the
instant petition for review on certiorari.
ISSUE: Whether or not admissions of the parties during the pre-trial as embodied in the pre-trial order of the court
are binding and conclusive on them?
RULING:
 Yes, the admissions of the parties during the pre-trial as embodied in the pre-trial order of the court are binding and
conclusive on them, unless there is a clear showing that the admission was entered through palpable mistake.
 Such admissions cannot be contradicted by the parties. The petitioners are thus estopped from claiming that the
property occupied by them is not the property titled to the respondents, and that the latter failed to prove the identity
of the claimed property.
 Since the property is titled to the respondents, they are entitled to possess the same.
 It bears stressing that a certificate of title serves as evidence of an indefeasible and incontrovertible title to the
property in favor of the person whose name appears therein.

Dispositive Portion:
IN LIGHT OF ALL THE FOREGOING, the petition is DENIED for lack of merit. Costs against the petitioners.
2. Philippine Export and Foreign Loan Guarantee Corporation vs. Amalgamated Management and Development
Corporation 658 SCRA 273-282, implied issues included in the Pre-trial Order

Facts:
 The petitioner, is a government-owned and controlled corporation
 Its primary purpose is to guarantee the foreign loans, granted to any domestic corporation
 Respondent (AMDC), a domestic corporation, had as its main business the hauling of different commodities within
the Middle East countries.
 Its corespondents Felimon R. Cuevas (Cuevas) and Jose A. Saddul, Jr. (Saddul) were, respectively, its President
and Vice President.
 In early 1982, AMDC obtained from the National Commercial Bank of Saudi Arabia (NCBSA) a loan amounting to
SR3.3 million (equivalent to P9,000,000.00)
 On April 23, 1982, the petitioner issued a letter of guaranty in favor of NCBSA as the lending bank upon the request
of AMDC.
 As the security for the guaranty, Amalgamated Motors Philippines Incorporated (AMPI), a sister company of AMDC,
acted as an accommodation mortgagor, and executed in favor of the petitioner a real estate mortgage
 AMDC also executed in favor of the petitioner a deed of undertaking dated April 21, 1982,6 with Cuevas and Saddul
as its co-obligors.
 AMDC defaulted on the obligation.
 Upon demand, the petitioner paid the obligation to NCBSA.
 The petitioner then demanded that AMDC, Cuevas and Saddul should pay the obligation, but its demand was not
complied with.
 Hence, it extrajudicially foreclosed the real estate mortgage.
 On the premise that the proceeds of the foreclosure sale were not sufficient to cover the guaranty, the petitioner
sued AMDC, Cuevas and Saddul in the RTC to collect the deficiency
 The petitioner posits that based on the RTC’s pre-trial order, the only issue to be resolved was whether there was
a deficiency claim after the foreclosure of the real estate mortgage; that the liability of Cuevas and Saddul on the
deficiency claim was already an admitted fact under the pre-trial order; and that the RTC improperly considered
and determined their liability.

Issue:
Did the RTC improperly consider and determine the liability of Cuevas and Saddul since it was not among the issues in
the pretrial order?

Ruling:
 NO
 Whether Cuevas and Saddul were liable on the deficiency claim was proper for the ascertainment and determination
by the RTC as the trial court and the CA as the appellate tribunal, notwithstanding the silence of the pre-trial order
on it, because such issue was deemed necessarily included in or inferred from the stated issue of whether there
was a deficiency still to be paid by AMDC, Cuevas and Saddul.
 It is true that the issues to be tried between the parties in a case shall be limited to those defined in the pre-trial
order, as Section 7, Rule 18 of the Rules of Court explicitly provides:
o Section 7. Record of pre-trial
o The proceedings in the pretrial shall be recorded. Upon the termination thereof, the court shall issue an
order which shall recite in detail the matters taken up in the conference, the action taken thereon, the
amendments allowed to the pleadings, and the agreements or admissions made by the parties as to any
of the matters considered.
o Should the action proceed to trial, the order shall explicitly define and limit the issues to be tried. The
contents of the order shall control the subsequent course of the action, unless modified before trial to
prevent manifest injustice
 However, a pre-trial order is not intended to be a detailed catalogue of each and every issue that is to be taken
during the trial, for it is unavoidable that there are issues that are impliedly included among those listed or that may
be inferable from those listed by necessary implication which are as much integral parts of the pre-trial order as
those expressly listed.
 At any rate, it remains that the petitioner impleaded Cuevas and Saddul as defendants, and adduced against them
evidence to prove their liabilities.
 With Cuevas and Saddul being parties to be affected by the judgment, it was only appropriate for the RTC to inquire
into and determine their liability for the purpose of arriving at a complete determination of the suit.
  Thereby, the RTC acted in conformity with the avowed reason for which the courts are organized, which was to put
an end to controversies, to decide the questions submitted by the litigants, and to settle the rights and obligations
of the parties

3. Mercader vs. DBP

G.R. No. 130699. May 12, 2000
DAVIDE, JR., C.J.:
purpose of modes of discovery

FACTS:

 In 1966, Juan Maderazo (father of the petitioners) applied for a loan at the DBP secured by mortgage of 2 parcels
of land. However, DBP asked Maderazo to construct a 5-meter wide road right of way over the adjoining lot, owned
by sps. Manreal for the loan to be approved. Maderazo complied and spent Php 10,000 for such construction;
 Meanwhile, Maderazo’s lease contract over the lot of sps. Manreal for the said ROA, was not registered for
Manreal’s failure, “for one reason or another,” to deliver the Certificate of Title (TCT) for annotation of the lease;
 About nine years later, Maderazo’s children, the spouses Florina Maderazo-Mercader and Bernardo Mercader
executed a contract of lease with the Manreals for a period of twenty years and four months over the remaining
portion of the lot in question. Bernardo Mercader constructed improvements and plated calamansi trees thereon-
all in sum spent not less than Php 25,000;
 The MERCADERs subsequently discovered that the reason why the Manreals failed to deliver the TCT of the lot
in quesyion [now registered in the names of spouses Felipe and Florentina Manreal, children of Gelacio and Vicenta
Manreal] was because they offered said lot including the improvements introduced by the Mercaders thereon
as “collateral” for a P150,000 deepsea fishing loan with the DBP;
 When the Manreals defaulted in the payment of their obligation to the DBP, the latter had taken steps to foreclose
the lot;
 The Mercaders filed a COMPLAINT and prayed that their interest be respected by DBP, or for the bank to reimburse
them the cost of the improvements and their loss now amounting to Php 210,000.00;
 The Manreals, in their ANSWER admitted only the existence of the 2 unregistered contracts of lease and the
calamansi trees planted. They then claimed that Felipe Manreal informed Juan Maderazo of the intention to offer
as security Lot No. 2985 for the deep seafishing loan with the DBP. They denied all other allegations and prayed
for the dismissal of the complaint for being utterly groundless;
 DBP’s ANSWER on the other hand, admitted only the loan of Maderazos and that of the Manreals (deep-sea fishing
loan), and denied any knowledge of the infirmity on the title of the Lot.
 The DBP maintained that the alleged unregistered interests of the MERCADERs did not and could not bind the
DBP per Art. 1648 of the Civil Code7 and Section 64 of Act 496. It then prayed for the dismissal of the complaint
for being premature and for lack of cause of action;
 In the meantime, the lot in question was sold on public auction and DPB emerged as the highest bidder;
 In the PRETRIAL stage, the trial court acknowledged the possibility of a compromise agreement, and gave time to
the parties to continue their negotiations;
 MERCADERs proposed that contract of lease for right of way be registered, and or allow the MERCADERs to
purchase Lot on installment basis;
 DBP on the other hand, offered 3 options: 1st is Sale, 2nd is Lease-Purchase and 3rd-Lease;
 Mercaders chose the 2nd option, and deposited Php 3,315.00, to which DBP issued an official receipt;
 With this development, on 9 December 1982, the trial court directed the parties to submit "their compromise
agreement which required the approval of the Board of Governors;
 Bernardo Mercader requested for a grace period in the payment of the amortization, however, the DBP rejected the
request. Bernardo Mercader replied through a letter suggesting this time that the amortization be paid on a quarterly
basis. DBP found this acceptable and reasoned that "the original conditions packaged in [its] proposal [were] no
longer applicable" considering that the market value of the property increased;
 With this, the trial court ordered the termination of the pre-trial and set the case for hearing, with the following
issues to be resolved:
o Whether the plaintiff [are] entitled to specific performance of said agreement;
o Whether the defendant bank can be compelled to recognize the lease contract entered into between the
spouses plaintiff Bernardo Mercader and Gelacio Manreal; and
o Whether the foreclosure proceedings of the contract between the defendant bank is null and void.
 7 November 1985, the MERCADERs filed a SUPPLEMENTAL PLEADING insisting the consummation of the lease-
purchase option with the payment of the earnest money.
 The DBP filed its OPPOSITION to the Supplemental Pleading;
 The trial court ordered the Manreals dropped from the case. The MERCADERs offered no objection;
  The trial court reiterated the three issues ascertained in the pre-trial order and resolved all of them IN FAVOR OF
THE MERCADERS; the TC ordered;
o DBP and its successors-in-interest to respect and preserve the Contracts of Lease between the Manreals
and the Mercaders
o DBP to exclude from the foreclosure proceedings the rights of the plaintiffs as covered by the Contract of
Lease;
o DBP to cause the annotation of the Contracts of Lease of plaintiffs title by by excluding the improvements
of Mercader as guarantee or collateral for defendant Felipe Manreal's deep-sea fishing loan;
o DBP to execute the deed of sale subject to the approval of the Manila Office of the DBP as to the mode of
payment, there being no agreement thereon;
 ON APPEAL, the Court of Appeals found that the trial court erred in treating the lease-purchase option as a
controversial issue considering that it was "outside the parties' pleadings. It entered a new judgement,
declaring that the MERCADERs were not entitled to any compensation from the DBP. It also ordered the
MERCADERs to immediately turn over the possession of Lot in question to the DBP;
 Hence, this PETITION To the SC;

ISSUE:
Whether the CA was correct in holding that the trial court should NOT HAVE taken cognizance of the lease-purchase option
as a controversial issue since it was not raised in the pleadings.

RULING:

This Court agrees with the MERCADERs and finds that the Court of Appeals erred in disregarding as material the lease-
purchase option on the ground that it was not raised in the pleadings.

If the Court of Appeals adverts to the lack of reference to the lease-purchase option in the initiatory pleadings, this can be
simply explained by the fact that the trial court only took cognizance thereof when it became an integral component of the
pre-trial proceedings. As a supplemental pleading, it served to aver supervening facts which were then not ripe for
judicial relief when the original pleading was filed. As such, it was meant to supply deficiencies in aid of the original
pleading, and not to dispense with the latter. Hence, it was patently erroneous for the Court of Appeals to pronounce
that the lease-purchase option was not raised in the pleadings. The DBP was even quite aware and knowledgeable of
the supplemental pleading because it filed an opposition thereto.

The DBP then is undoubtedly estopped from questioning the trial court’s inclusion of the lease purchase option as a
controversial issue.

The TC’s action of admitting the supplemental pleading is anchored in:

Section 4. Record of pre-trial results. -- After the pre-trial the court shall make an order which recites the action taken at
the conference, the amendments allowed to the pleadings, and the agreements made by the parties as to any of the matters
considered. Such order shall limit the issues for trial to those not disposed of by admissions or agreements of counsel and
when entered controls the subsequent course of the action, unless modified before trial to prevent manifest injustice.

Indeed, the pre-trial is primarily intended to make certain that all issues necessary to the disposition of a case are properly
raised. The purpose is to obviate the element of surprise, hence, the parties are expected to disclose at the pre-trial
conference all issues of law and fact which they intend to raise at the trial, except such as may involve privileged or
impeaching matter.

In the case at bar, the pre-trial order included as integral to the complete adjudication of the case the issue of
whether the MERCADERs can demand specific performance from the DBP relative to the lease-purchase option.
Thus, the element of surprise that the provision on pre-trial attempts to preclude was satisfied. The surprise factor
was further eliminated, as already earlier mentioned and merely to reiterate here, with the DBP's (1) motion to oppose the
supplemental pleading, (2) objection to the introduction of evidence connected thereto, (3) later information from the trial
court of its definitive ruling admitting the supplemental pleading, (4) own introduction of evidence related thereto, and finally,
by its (5) intensive participation in the direct and cross-examination of witnesses whose testimonies included said topic. In
any case, the filing and consequent admission of the supplemental pleading by the trial court validated the issues embraced
in the pre-trial order.

FURTHERMORE, assuming arguendo that the MERCADERs failed to file the supplemental pleading, evidence relative
to the lease-purchase option may be legitimately admitted by the trial court in conformity with Section 5, Rule 10 of
the Rules of Court which states:
Section 5. Amendment to conform to or authorize presentation of evidence. -- When issues not raised by the pleadings are
tried by express or implied consent of the parties, they shall be treated in all respects, as if they had been raised in the
pleadings. Such amendment of the pleadings as may be necessary to cause them to conform to the evidence and to raise
these issues may be made upon motion of any party at any time, even after judgment; but failure so to amend does not
affect the result of the trial of these issues. If evidence is objected to at the trial on the ground that it is not within the issues
made by the pleadings, the court may allow the pleadings to be amended and shall do so freely when the presentation of
the merits of the action will be subserved thereby and the objecting party fails to satisfy the court that the admission of such
evidence would prejudice him in maintaining his action or defense upon the merits. The court may grant a continuance to
enable the objecting party to meet such evidence. (emphasis supplied)

This provision envisions two scenarios -- first, when there is no objection, and second when there is an objection.

In Co Tiamco v. Diaz, the Court held that "when evidence is offered on a matter not alleged in the pleadings, the court may
admit it even against the objection of the adverse party, where the latter fails to satisfy the court that the admission of
the evidence would prejudice him in maintaining his defense upon the merits, and the court may grant him a continuance
to enable him to meet the new situation created by the evidence. Of course, the court, before allowing the evidence, as a
matter of formality, should allow an amendment of the pleading, xxx And, furthermore, where the failure to order an
amendment does not appear to have caused surprise or prejudice to the objecting party, it may be allowed as a harmless
error. Well-known is the rule that departures from procedure may be forgiven where they do not appear to have impaired
the substantial rights of the parties.”

Henceforth, DBP was not and would not be prejudiced by the incorporation of the lease-purchase option as one of the
controverted issues. Moreover, it had been afforded ample opportunity to refute and object to the evidence germane thereto,
thus, the rudiments of fair play had been properly observed.

Instant petition is GRANTED.

4. Dasmarinas Garments Inc vs Reyes (deposition)

Facts:
 American President Lines (APL) Ltd sued Dasmarinas Garments Inc in the RTC Manila to recover the sum of
$53,228.45
 Dasmarinas specifically denied any liability to the plaintiff and set up compulsory counterclaims against it
 At the hearing of May 3, 1989, instead of presenting its witnesses, APL filed a motion praying that it intended to
take the depositions of H. Lee and Yeong Fang Yeh in Taipei, Taiwan
 5 days later, APL filed an amended motion stating that since the Philippine Gov’t has no consulate office in Taiwan
in view of its one-china policy, there being in lieu thereof an office set up by the Pres “presently occupied by Director
Joaquin Roces which is the Asian Exchange Center, Inc.,” it was necessary and it therefore prayed” that commission
or letters rogatory be issued addressed to Director Joaquin Roces
 The motion was opposed by Dasmariñas. It contended that
o (a) the motion was “fatally defective in that it does not seek ** that a foreign court examine a person within
its jurisdiction;”
o (b) issuance of letters rogatory was unnecessary because the witnesses “can be examined before the
Philippine Court;”
o and (c) the Rules of Court “expressly require that the testimony of a witness must be taken orally in open
court and not by deposition.”
 APL submitted to the Trial Court
o (a) the letter received by its counsel from Director Joaquin R. Roces of the Asian Exchange Center, Inc.,
advising that “this Office can only take deposition upon previous authority from the Department of Foreign
Affairs,” this being “in consonance with the Supreme Court Administrative Order requiring courts or judicial
bodies to course their requests through the Department of Foreign Affairs;” and
o (b) a letter sent by “fax” to the same counsel by a law firm in Taipei, Lin & Associates Maritime Law Office,
transmitting information inter alia of the mode by which, under the ROC Civil Procedure Code, “a copy or
an abridged copy” of documents on file with a Taiwan Court may be obtained.
 Trial court decided in favor of APL
o opined that the Asian Exchange Center, Inc. being the authorized Philippine representative in Taiwan, may
take the testimonies of plaintiffs’ witnesses residing there by deposition, but only upon written
interrogatories so as to give defendant the opportunity to cross-examine the witnesses by serving cross-
examination.
 Dasmariñas sought reconsideration by motion on the following grounds:
o (1) authority of the Asian Exchange Center, Inc. (AECI) to take depositions has not been established, it not
being one of those so authorized by the Rules of Court to take depositions in a foreign state;
o (2) AECI’s articles of incorporation show that it is not vested with any such authority;
 o (3) to permit deposition-taking by commission without the authority of the foreign state in which deposition
is taken constitutes infringement of judicial sovereignty; and
o (4) depositions by written interrogatories have inherent limitations and are not suitable to matters dependent
on the credibility of witnesses; oral testimony in open court remains the “most satisfactory method of
investigation of facts” and “affords the greatest protection to the rights and liberties of citizens.”
 Motion for recon was denied because filed out of time and APL was directed to take necessary steps to implement
the order, otherwise inaction or lack of interest deemed a waiver
 Dasmarinas instituted a special civil action of certiorari in CA to nullify the order of the trial court
o Denied petition

 Dasmariñas ascribes to the CA the following errors, to wit:

o in holding that a party could, during the trial of the case, present its evidence by taking the deposition of its
witnesses in a foreign jurisdiction before a private entity not authorized by law to take depositions in lieu of
their oral examination in open Court considering that:
a. the taking of deposition is a mode of pretrial discovery to be availed of before the action comes to trial;
b. no urgent or compelling reason has been shown to justify the departure from the accepted and usual judicial
proceedings of examining witnesses in open court where their demeanor could be observed by the trial judge;
c. in disregarding the inherently unfair situation in allowing private respondent, a foreign entity suing in the Philippines,
to present its evidence by mere deposition of its witnesses away from the penetrating scrutiny of the trial Judge
while petitioner is obligated to bring and present its witnesses in open court subject to the prying eyes and probing
questions of the Judge; and in sanctioning the deposition taking of ** (APL’s) witnesses in Taipei, Taiwan, a foreign
jurisdiction not recognized by the Philippines in view of its one-China policy, before the AECI, a private entity not
authorized by law to take depositions.

Issue: Whether or not the Asian Exchange Center, Inc, through Director Joaquin R. Roces, was authorized to take the
deposition under the Rules of Court?

Ruling: YES.

 Depositions are chiefly a mode of discovery. They are intended as a means to compel disclosure of facts resting in the
knowledge of a party or other person which are relevant in some suit or proceeding in court.
 Depositions, and the other modes of discovery (interrogatories to parties; requests for admission by adverse party;
production or inspection of documents or things; physical and mental examination of persons) are meant to enable a
party to learn all the material and relevant facts, not only known to him and his witnesses but also those known to the
adverse party and the latter’s own witnesses.
 In fine, the object of discovery is to make it possible for all the parties to a case to learn all the material and relevant
facts, from whoever may have knowledge thereof, to the end that their pleadings or motions may not suffer from
inadequacy of factual foundation, and all the relevant facts may be clearly and completely laid before the Court, without
omission or suppression.
 Depositions are principally made available by law to the parties as a means of informing themselves of all the relevant
facts; they are not therefore generally meant to be a substitute for the actual testimony in open court of a party or
witness.

 The deponent must as a rule be presented for oral examination in open court at the trial or hearing. This is a requirement
of the rules of evidence. Section 1, Rule 132 of the Rules of Court.

 Indeed, any deposition offered to prove the facts therein set out during a trial or hearing, in lieu of the actual oral
testimony of the deponent in open court, may be opposed and excluded on the ground that it is hearsay; the party
against whom it is offered has no opportunity to cross-examine the deponent at the time that his testimony is offered. It
matters not that that opportunity for cross-examination was afforded during the taking of the deposition; for normally,
the opportunity for cross-examination must be accorded a party at the time that the testimonial evidence is actually
presented against him during the trial or hearing.

 However, depositions may be used without the deponent being actually called to the witness stand by the proponent,
under certain conditions and for certain limited purposes.
 These exceptional situations are governed by Section 4, Rule 24 of the Rules of Court.

 The principle conceding admissibility to a deposition when the deponent is dead, out of the Philippines, or otherwise
unable to come to court to testify, is consistent with another rule of evidence, found in Section 47, Rule 132 of the Rules
of Court.
 It is apparent then that the deposition of any person may be taken wherever he may be, in the Philippines or abroad.
 If the party or witness is in the Philippines, his deposition “shall be taken before any judge, municipal or notary public”
(Sec. 10, Rule 24, Rules of Court).
 If in a foreign state or country, the deposition “shall be taken: (a) on notice before a secretary or embassy or legation,
consul general, consul, vice-consul, or consular agent of the Republic of the Philippines, or (b) before such person or
officer as may be appointed by commission or under letters Rogatory” (Sec. 11, Rule 24).

 Leave of court is not necessary where the deposition is to be taken before “a secretary or embassy or legation, consul
general, consul, vice-consul, or consular agent of the Republic of the Philippines,” and the defendant’s answer has
already been served (Sec. 1, Rule 24).
 After answer, whether the deposition-taking is to be accomplished within the Philippines or outside, the law does not
authorize or contemplate any intervention by the court in the process, all that is required being that “reasonable notice”
be given “in writing to every other party to the action ** (stating) the time and place for taking the deposition and the
name and address of each person to be examined, if known, and if the name is not known, a general description
sufficient to identify him or the particular class or group to which he belongs. **” (Sec. 15, Rule 24).
 The court intervenes in the process only if a party moves
 (1) to “enlarge or shorten the time” stated in the notice (id.), or
 (2) “upon notice and for good cause shown,” to prevent the deposition-taking, or impose conditions therefor,
e.g., that “certain matters shall not be inquired into” or that the taking be “held with no one present except the
parties to the action and their officers or counsel, “ etc. (Sec. 16, Rule 24), or
 (3) to terminate the process on motion and upon a showing that “it is being conducted in bad faith or in such
manner as unreasonably to annoy, embarrass, or oppress the deponent or party”

 Where the deposition is to be taken in a foreign country where the Philippines has no “secretary or embassy or legation,
consul general, consul, vice-consul, or consular agent,” then obviously it may be taken only “before such person or
officer as may be appointed by commission or under letters rogatory.
 A commission may be defined as “(a)n instrument issued by a court of justice, or other competent tribunal, to authorize
a person to take depositions, or do any other act by authority of such court or tribunal”
 Letters rogatory may be defined as “(a)n instrument sent in the name and by the authority of a judge or court to another,
requesting the latter to cause to be examined, upon interrogatories filed in a cause pending before the former, a witness
who is within the jurisdiction of the judge or court to whom such letters are addressed”

Application:
 In the case at bar, the Regional Trial Court has issued a commission to the Asian Exchange Center, Inc. thru
Director Joaquin R. Roces to take the testimonies of ** Kenneth H. Lee and Yeong Fah Yeh, by deposition (upon
written interrogatories) **.
 It appears that said Center may, upon request and authority of the Ministry (now Department) of Foreign Affairs,
Republic of the Philippines issue a Certificate of Authentication attesting to the identity and authority of Notaries
Public and other public officers of the Republic of China, Taiwan – a prima facie showing not rebutted by petitioner.
 the commission is to be coursed through the Department of Foreign Affairs conformably with Circular No 4 directing
“ALL JUDGES OF THE REGIONAL TRIAL COURTS, METROPOLITAN TRIAL COURTS, MUNICIPAL TRIAL
COURTS IN CITIES, MUNICIPAL TRIAL COURTS AND MUNICIPAL CIRCUIT TRIAL COURTS” to course all
requests for the taking of deposition of witnesses residing abroad through the Department of Foreign Affairs to
enable it and the Philippine Foreign Service establishments to act on the matter in a judicious and expeditious
manner; this, in the interest of justice, and to avoid delay in the deposition-taking.

 Petitioner would however prevent the carrying out of the commission on various grounds.
o The first is that the deposition-taking will take place in “a foreign jurisdiction not recognized by the
Philippines in view of its one-China policy. This is inconsequential.
 What matters is that the deposition is taken before a Philippine official acting by authority
of the Philippine Department of Foreign Affairs and in virtue of a commission duly issued
by the Philippine Court in which the action is pending, and in accordance, moreover, with
the provisions of the Philippine Rules of Court pursuant to which opportunity for cross-
examination of the deponent will be fully accorded to the adverse party.
o Dasmariñas also contends that the “taking of deposition is a mode of pretrial discovery to be availed of
before the action comes to trial.”
 Not so.
 Depositions may be taken at any time after the institution of any action, whenever necessary
or convenient. There is no rule that limits deposition-taking only to the period of pre-trial or before
it; no prohibition against the taking of depositions after pretrial.
  Indeed, the law authorizes the taking of depositions of witnesses before or after an appeal is taken
from the judgment of a Regional Trial Court “to perpetuate their testimony for use in the event of
further proceedings in the said court” (Rule 134, Rules of Court), and even during the process of
execution of a final and executory judgment.
o Dasma further claims that the taking of deposition under the circumstances is a “departure from the
accepted and usual judicial proceedings of examining witnesses in open court where their demeanor could
be observed by the trial judge”;
 That it is “inherently unfair” to allow APL, “a foreign entity suing in the PH, to present its evidence
by mere deposition of its witnesses away from the penetrating scrutiny of the Trial Judge while
petitioner is obligated to bring and present its witnesses in open court subject to the prying eyes
and probing questions of the Judge

 Of course the deposition-taking in the case at bar is a departure from the accepted and usual judicial
proceedings of examining witnesses in open court where their demeanor could be observed by the trial
judge;
o But the procedure is not on that account rendered illegal nor is the deposition thereby taken, inadmissible.
o It precisely falls within one of the exceptions where the law permits such a situation, i.e., the use of
a deposition in lieu of the actual appearance and testimony of the deponent in open court and without being
“subject to the prying eyes and probing questions of the Judge.”
 This is allowed provided the deposition is taken in accordance with the applicable provisions of the Rules of Court
and the existence of any of the exceptions for its admissibility, e.g., “that the witness if out of the province and at a
greater distance than 50 kilometers from the place of trial or hearing, or is out of the Philippines, unless it appears
that his absence was procured by the party offering the deposition; or ** that the witness is unable to attend to testify
because of age, sickness, infirmity, or imprisonment, etc (Sec. 4, Rule 24, supra, italics supplied) is first satisfactorily
established.
 The RTC saw fit to permit the taking of the depositions of the witnesses in question only by written interrogatories,
removing the proponent’s option to take them by oral examination, i.e., by going to Taipei and actually questioning
the witnesses verbally with the questions and answers and observations of the parties being recorded
stenographically. The imposition of such a limitation, and the determination of the cause thereof, are to be sure
within the Court’s discretion.
 The ostensible reason given by the Trial Court for the condition that the depositions be taken “only upon written
interrogatories is “so as to give defendant (Dasmariñas) the opportunity to cross- examine the witnesses by serving
cross-interrogatories.”
 The statement implies that opportunity to cross-examine will not be accorded the defendant if the depositions were
to be taken upon oral examination, which, of course, is not true. For even if the depositions were to be taken on
oral examination in Taipei, the adverse party is still accorded full right to cross-examine the deponents by the law,
either by proceeding to Taipei and there conducting the cross-examination orally or opting to conduct said cross-
examination merely by serving cross-interrogatories.

The Court resolved to dismiss the petition

5. Cariaga vs. Court of Appeals, G.R. No. 143561, June 6, 2001 [Depositions]
Ponente: Gonzaga-Reyes, J.

Nature of the Case: This case is a petition for review on certiorari of a decision of the Court of Appeals, which affirmed
the decision of the RTC, which convicted petitioner Jonathan Cariaga of the crime of Qualified Theft.

FACTS:
 Luis Miguel Aboitiz, employed at the time of the incident in question and for sometime prior thereto as Systems
Analyst of the Davao Light & Power Company, Inc. (DLPC), whose duty was to devise systems, procedures or
controls to promote efficiency, prevent losses due to waste, pilferage or theft of company property, etc
 He received reports that some private electricians were engaged in the clandestine sale of DLPC materials
and supplies.
 He initiated a covert operation with the following objectives: (1) ascertain how DLPC materials were being stolen,
the frequency of the thefts, who were perpetrating the thefts; and (2)‘catch’ at least one (1) DLPC employee that
may be involved.
 In October, 1988, he sought the assistance of Sgt. Fermin Villasis, Chief, Theft & Robbery Section, San Pedro
Patrol Station, Davao METRODISCOM
o He also hired one Florencio Siton, a welder by occupation and a Civilian Home Defense Forces (CHDF)
member, as his undercover agent under the pseudonym ‘Canuto Duran,’ an ‘electrician from Kabakan,
Cotabato.’
  Canuto Duran struck an acquaintance with one Ricardo Cariaga, a private electrician, at the Miguel Store, situated
in front of the DLPC office along Ponciano Reyes (now Bangoy) Street, Davao City.
o He told Ricardo that his boss ordered him to buy electrical materials to be brought to Diwalwal, a gold
panning area in Monkayo, Davao (formerly Davao del Norte)
o Ricardo offered to supply ‘Canuto Duran’ with electrical materials, saying that he has a cousin from whom
he can procure the same.
o ‘Canuto’ purchased small electrical wires which, according to Ricardo, came from his cousin, Jonathan
Cariaga, nicknamed Totoy
 On November 17, 1988, Ricardo introduced ‘Canuto’ to Jonathan at Miguel Store.
o It turned out that Jonathan was the assigned driver of DLPC Service Truck assigned to Work Gang
‘Venus.’
o ‘Canuto’ inquired from Jonathan if he could supply him with two (2) 15 KVA transformers.
o Jonathan replied that he could for P16,000.
o ‘Canuto’ placed an order for the transformers.
o The deal did not materialize, however, as ‘Canuto’s’ boss (Miguel Aboitiz) who would provide the funds
happened to be out of town. Jonathan appeared piqued. To appease him, ‘Canuto’ assured him that they
shall continue their ‘business’ relationship.
 Siton’s undercover work came to an abrupt end on February 1, 1989 when members of Sgt. Villasis’ team
‘apprehended’ ‘Canuto’ and turned him over, including the electrical wires that he previously purchased from
Jonathan through Ricardo, to the San Pedro Patrol Station.
 The team was unable to arrest Ricardo as he had already left when the team arrived at his house.
 ‘Canuto Duran’ ‘confessed’ in order to persuade Ricardo·and the others who were involved·to likewise come out
with the truth. Thus, when Ricardo and Sergio Jamero appeared at the San Pedro Patrol Station on the invitation
of the police, they confessed to their crimes.
 Ricardo revealed that he acted as a fence for his cousin, Jonathan Cariaga and ‘Canuto Duran’ and that the items
that ‘Canuto Duran’ bought from Jonathan, thru him, were DLPC properties
 Jamero also confessed that Ricardo was his fence in disposing of DLPC electrical materials that he pilfered but the
items were not sold to ‘Canuto Duran’ but to someone else.

According to the RTC:

 The prosecution’s evidence considered as a whole is strong, clear and convincing.
 The statements in the extrajudicial confessions of Ricardo Cariaga implicative of the accused as the source of
the stolen articles, corroborated by Siton’s testimony and the police records are formidable compared to the mere
puny denial of the accused.
 It found accused Jonathan Cariaga guilty of theft, qualified by grave abuse of confidence.

CA Ruling: (Jonathan Cariaga appealed before the CA)

 Affirmed RTC’s decision
 It reasoned out that the sworn statement of Ricardo Cariaga who did not testify in open court during the criminal
proceedings against petitioner is admissible in evidence and properly considered by the trial court as this was
annexed part of DLPC’s position paper submitted to the NLRC
 It also upheld the credibility of Siton’s testimony which corroborated that of Ricardo Cariaga’s sworn statement.
Hence, this petition

ISSUE 1: Was the sworn statement of Ricardo Cariaga admissible in evidence?

RULING 1:
 No. The sworn statement of Ricardo Cariaga was not admissible in evidence.
 Section 47 of Rule 130 on testimony or deposition at a former proceeding provides that the testimony or
deposition of a witness deceased or unable to testify, given in a former case or proceeding, judicial or administrative,
involving the same parties and subject matter, may be given in evidence against the adverse party who had the
opportunity to cross-examine him.
o However, more specific is the rule prescribed in Rule 115, Section 1(f) of the Rules of Court in respect of
the admissibility in evidence in a criminal case of the previous testimony of unavailable witnesses [refer to
notes below]
 In Toledo, Jr. vs. People, this Court emphasized that “the preconditions set forth in Section 47, Rule 130 for the
admission of testimony given by a witness out of court must be strictly complied with and that there is more
reason to adopt such a strict rule in the case of Section 1(f) of Rule 115, for apart from being a rule of evidence
with additional specific requisites to those prescribed by Section 47, more importantly, said provision is an
implementing translation of the constitutional right of an accused person “to meet the witnesses (against him) face
to face.
  In this case, the records reveal that witness Ricardo Cariaga was subpoenaed only once and did not appear to
testify in the criminal case against petitioner.
 Concededly, this witness was not deceased or out of the Philippines.
 In fact, the private prosecutor informed the court that he is in Sultan Kudarat, and previously, his wife informed the
sheriff that he was in Sultan Kudarat which is in Cotabato, a mere four hours drive from Davao City.
 Against this backdrop, can this witness be categorized as one that cannot be found despite due diligence,
unavailable or unable to testify.
 It must be emphasized that this rule is strictly complied with in criminal cases, hence, “mere sending of subpoena
and failure to appear is not sufficient to prove inability to testify.
o The Court must exercise its coercive power to arrest.
 In the instant case, no efforts were exerted to have the witness arrested which is a remedy available to a party-
litigant in instances where witnesses who are duly subpoenaed fail to appear.
 On this score alone, the sworn statement of Ricardo Cariaga should not have been admitted as evidence for
the prosecution, and this Court shall no longer delve into the other aspects of this rule.

ISSUE 2: Was the testimony of prosecution witness, Florencio Siton [the undercover agent], credible?

RULING 2:
 Yes. The testimony of prosecution witness Siton was credible.
 The trial judge who sees and hears witnesses testify has exceptional opportunities to form a correct conclusion as
to the degree of credit, which should be accorded their testimonies.
 Next, the rule has also always been that the contradictions between the contents of an affiant’s affidavit and his
testimony on the witness stand do not always militate against the witness’ credibility because we have long
taken judicial notice that affidavits, which are usually taken ex parte, are often incomplete and inaccurate.
o Indeed, a sworn statement taken ex parte is generally considered to be inferior to a testimony given in open
court as the latter is subject to the test of cross examination
 In this case, this Court has carefully gone over the records and evidence in this case and is persuaded that Siton’s
testimony in court deserves credence.
 It further finds the same sufficient for conviction.
 Siton was consistent and straightforward in his testimony and had not been shaken by the lengthy and
exhaustive cross-examination by the defense counsel.
 Having thoroughly convinced the trial and appellate courts as well as this Court of the truth of his testimony, this
Court does not see how he could have fabricated the entire story.
 The fact that he stated on direct examination that he “corrected” his statement and that he was offered compensation
for his undercover work does not necessarily discredit him.
 There is no rule of evidence to the effect that omission of certain particulars in a sworn statement would estop an
affiant from making an elaboration thereof or from correcting inaccuracies during the trial.
o It appears that he was paid for his services rendered as an undercover agent and not for purposes of
concocting a story and imputing a crime as that made out in the information.
o Similarly, the alleged inaccuracies in the testimony of Siton in open court relating to such minute details as
whether the petitioner’s house was two-stories high and located in a corner are too negligible to consider.

Further, the Court rejected petitioner’s claim that the testimonies of three witnesses for the prosecution, namely, Sauro,
Saligan and Aboitiz, engendered reasonable doubt sufficient to exculpate him.
 This Court is satisfied that the participation of the petitioner in the commission of the crime at bar was well
established by the testimony of witness Siton.
 In the determination of the sufficiency of evidence, what matters is not the number of witnesses, but their credibility
and the nature and quality of their testimonies.
 It is axiomatic that witnesses are weighed, not numbered and the testimony of only one witness, if credible and
positive and if it satisfies the court beyond reasonable doubt, is sufficient to convict.
 The inadmissibility of Ricardo Cariaga’s sworn statement as discussed above will not exculpate him.

Disposition: Affirmed CA decision with modification

NOTES:
Section 1(f) of the Rules of Court:
 Section 1. Rights of accused at the trial. – In all criminal prosecutions, the accused shall be entitled:
o (f) To confront and cross-examine the witnesses against him at the trial. Either party may utilize as part of
its evidence the testimony of a witness who is deceased, out of or cannot with due diligence be found in
the Philippines, unavailable or otherwise unable to testify, given in an other case or proceeding, judicial or
 administrative, involving the same parties and subject matter, the adverse party having had the opportunity
to cross-examine him;

6. Philippine Health Insurance Corp vs Our Lady of Lourdes Hospital (Interrogatories)

FACTS:
 Petitioner Philippine Health Insurance Corporation (PHIC) is a government corporation created under Republic
Act (R.A.) No. 7875, as amended, to administer and implement the country’s National Health Insurance Program,
while respondent Our Lady of Lourdes Hospital (OLLH) is an institutional health care provider duly accredited with
the PHIC.
 PHIC filed a Complaint with its Legal Sector-Prosecution Department against OLLH for the administrative offense
of filing multiple claims, which is penalized under Section 145, Rule XXVIII of the Implementing Rules and
Regulations (IRR) of R.A. No. 7875. Allegedly, OLLH filed two claims of the same amount of PhilHealth benefits
involving the same patient for the same diagnosis and covering the same period of confinement.
 On June 23, 2009, OLLH filed a Verified Answer.8 After which, the parties were directed to file their respective
Position Papers.9 PHIC complied with the order.
 On its part, OLLH moved to defer the submission of its position paper pending the answer of the PHIC President
and CEO to the written interrogatories as well as the inspection and copying of the original transmittal letter and
all other claims that accompanied Annex B11 of the Complaint.
o According to OLLH, these modes of discovery were availed of because its representatives were denied
and/or not given access to documents and were not allowed to talk to PHIC personnel with regard to the
charge.
 Thereafter, the PHIC Arbitration Department, through Arbiter De Leon, denied OLLH’s motion:
In the light of being summary in nature of the rules that govern the administrative proceedings as
in this case, the interrogatories and motion for production and inspection of documents filed by [OLLH]
[cannot] be given due course by this Office. Relevantly, for an obvious reason as can be inferred from the
purpose of the said pleadings, the allowance of the same would not practically hasten the early
disposition of the instant case, instead undermine the objective of the above cited provisions [Sections 91
and 92 of the 2004 IRR of R.A. No. 7875, as amended by R.A. No. 9241] which clearly and explicitly
demand or call for an immediate resolution of the subject case.
The bare and unsubstantiated allegations of [OLLH] that its representatives
were denied access to the documents pertaining to the PhilHealth claim subject of this controversy and at
the same time were not allowed to talk to any of the PhilHealth personnel which prompted the respondent
to resort to the modes of discovery herein above mentioned, deserve scant consideration for being
selfserving.
[On] the contrary, this Office perceives the [OLLHÊs] filing of the aforesaid pleadings [was]
designed for no other conceivable end or purpose but to delay the proceedings.
 The Motion for Reconsideration16 filed by OLLH suffered the same fate as the September 4, 2009 Order held:
Evidently, the main argument of [OLLH] as can be perused in its Motion is predicated on the
Supreme Court ruling, specifically in Koh v. Intermediate Appellate Court, 144 SCRA 259 [1986], which
recognizes the importance of rules on discovery in
expediting the trial of the case. However, in the same cited case, it was also declared that „the recourse
to discovery procedure is not mandatory. If the parties do not choose to resort to such procedures, the
pretrial conference should be set x x x x.” Likewise, it is worth emphasizing that the above cited
decision of the Supreme Court relied upon by [OLLH] pertains to a civil case filed in the regular court of
justice. It would have been convincing if not plausible if respondent presented the same citation or ruling
concerning mode of discovery which was indispensably applied in administrative case.
[OLLH] should be reminded also that the President of this Corporation, who incidentally is the
person to whom the interrogatories are addressed to, albeit being the top official of the corporation is not
the most competent to answer the interrogatories.
The type of questions in the interrogatories point toward issues arising from and related to the filing and
processing of claims, naturally and logically, the one who is entrusted and tasked to process said claim is
the competent person. The resort to modes of discovery shall be defeated if it is not addressed to the
proper competent party. Indisputably, [OLLH] has already been accredited by the Corporation for quite
some time already that it made this Office wonder why until now respondent is not yet aware on how a
certain filed claim is being processed and what department of this Corporation is tasked to do the job in
order for it to have an idea to whom it shall address its interrogatories. Be that as it may, this Office
believes that all the issues and queries raised by [OLLH] in its motion may be addressed in the hearing to
be held AFTER submission of its position paper.
 Aggrieved, OLLH elevated the issue to the Court of Appeals via petition for certiorari.
 o As stated, the CA reversed the Resolution and Order of the PHIC Arbitration Department. In ruling that
grave abuse of discretion was committed when OLLHÊs resort to modes of discovery was denied, the
appellate court said:
The subject of the Interrogatories appears to be relevant and not privileged as they pertain to the
procedure being followed by PHIC in processing and evaluating claims. Petitioner OLLH has also shown
the materiality and relevancy of the document sought to be produced or inspected · the transmittal letter
and other claims that accompanied the alleged second claim dated June 19, 2007 · which was PHICÊs
basis for the charge of filing multiple claims against petitioner OLLH. Verily, petitioner OLLHÊs resort to
modes of discovery was necessary for the preparation of its defense and the full determination of
petitioner the issue raised in the administrative case.
 Before Us, PHIC contends that Arbiter De Leon did not gravely abuse his discretion since he merely complied
with the rules of procedure governing the exercise of PHICÊs quasi-judicial function.

ISSUE: whether or not the CA erred in annulling and setting aside the August 11, 2009 Resolution and
September 4, 2009 Order of the PHIC Arbitration Department, which denied OLLHÊs resort to modes of
discovery, this Court resolves in the affirmative.

RULING: YES
 Through written interrogatories, a party may elicit from the adverse party or parties any facts or matter that are not
privileged and are material and relevant to the subject of the pending action. Like other modes of discovery
authorized by the Rules, the purpose of written interrogatories is to assist the parties in clarifying the issues and in
ascertaining the facts involved in a case.
o On the other hand, the provision on production and inspection of documents is to enable not only the
parties but also the court (in this case, the PHIC Arbitration Department) to discover all the relevant and
material facts in connection with the case pending before it.33 It must be shown, therefore, that the
documents sought to be produced, inspected and/or copied/photographed are material or contain
evidence relevant to an issue involved in the action.

 In this case, the questions contained in the written interrogatories filed and received on July 28, 2009 sought to
elicit facts that could already be seen from the allegations as well as attachments of the Complaint and the
Verified Answer.
o Specifically, the entries in the three (3) Validation Report that OLLH sought to be identified and/or
explained by PHIC are either immaterial or irrelevant (to the issue of whether OLLH is guilty of filing
multiple claims and OLLHÊs defense that it inadvertently attached a second copy of the subject
PhilHealth Claim Form 2 to the Transmittal Letter filed on June 19, 2007) or, even if material or relevant,
are self-explanatory and need no further elaboration from PHIC. Thus, the interrogatories were frivolous
and need not be answered.
o Aside from this, the PHIC Arbitration Department correctly observed that the written interrogatories were
mistakenly addressed to the President and CEO of PHIC, who could not competently answer, either
based on his job description or firsthand experience, issues that arose from and related to the filing and
processing of claims.

 We likewise find as self-serving the allegation of OLLH that its representatives were denied access to the
documents pertaining to the subject PhilHealth claim and, at the same time, were not allowed to talk to any of the
PhilHealth personnel. No iota of evidence, documentary or testimonial, was submitted to substantiate this
convenient excuse.

 As the PHIC Arbitration Department held, all the issues and queries raised by OLLH in its written interrogatories
and motion for production/inspection may be addressed in a hearing to be held after submission of the position
paper of the parties. If the Arbiter deemed it necessary, based on the required pleadings already submitted, a
formal hearing may be conducted wherein witnesses who testify may be subjected to clarificatory questions. In
such hearing, the Arbiter has the power to issue subpoena ad testificandum and duces tecum; he may issue
subpoenas requiring attendance and testimony of witnesses or the production of documents and other material/s
necessary. In effect, these serve the same purposes of the modes of discovery.

DISPOSITIVE: WHEREFORE, premises considered, the petition is GRANTED. The July 27, 2010 Decision of the Court
of Appeals in C.A.-G.R. S.P. No. 110444, which reversed the August 11, 2009 Resolution and September 4, 2009 Order
of the Arbitration Department of the Philippine Health Insurance Corporation that denied Our Lady of Lourdes HospitalÊs
resort to modes of discovery, is ANNULLED AND SET ASIDE.
SO ORDERED.

NOTES:
The foregoing considered, Arbiter De Leon did not commit grave abuse of discretion in denying OLLHÊs plea for written
interrogatories and production/inspection of documents. His resolutions were consistent with the summary nature of the
administrative proceedings, expeditiously resolving the case from the perspectives of time dimension and efficiency
dimension.

7. Eagleridge Development Corporation vs. Cameron Granville 3 Asset Management, Inc., (production or
inspection of documents)
G.R. No. 204700, April 10, 2013
LEONEN, J.:

For resolution is respondent Cameron Granville 3 Asset Management, Inc. 's motion for reconsideration1 of our
April 10, 2013 decision,2 which reversed and set aside the Court of Appeals' resolutions3 and ordered
respondent to produce the Loan Sale and Purchase Agreement (LSPA) dated April 7, 2006, including its annexes
and/or attachments, if any, in order that petitioners may inspect or photocopy the same.

FACTS:
 Cameron Granville 3 Asset Management, Inc. filed a motion for reconsideration which raises the following points:
(1) The motion for production was filed out of time;7
(2) The production of the LSPA would violate the parol evidence rule; and
(3) The LSPA is a privileged and confidential document.
 Petitioners Eagleridge Development Corporation, Marcelo N. Naval, and Crispin I. Oben filed on June 7, 2013
their motion to admit attached opposition.
 Subsequently, respondent filed its reply and petitioners their motion to admit attached rejoinder.
 Respondent asserts that there was no "insistent refusal" on its part to present the LSPA, but that petitioners filed
their motion for production way out of time, even beyond the protracted pre-trial period from September 2005 to
2011.
o Hence, petitioners had no one to blame but themselves when the trial court denied their motion as it was
filed only during the trial proper.
 For their part, petitioners counter that their motion for production was not filed out of time, and "there is no
proscription, under Rule 27 or any provision of the Rules of Court, from filing motions for production, beyond the
pre-trial."

ISSUE: Whether or not Discovery mode of

production/inspection of document may be availed of even beyond pre-trial?
RULING:
 Yes, The availment of a motion for production, as one of the modes of discovery, is not limited to the pre-
trial stage.
 Rule 27 does not provide for any time frame within which the discovery mode of production or inspection of
documents can be utilized.
 The rule only requires leave of court "upon due application and a showing of due cause."
 Section 1, Rule 27 of the 1997 Rules of Court, states: Section 1. Motion for production or inspection; order. Upon
motion of any party showing good cause therefor, the court in which an action is pending may;
o order any party to produce and permit the inspection and copying or photographing, by or on behalf of the
moving party, of any designated documents, papers, books, accounts, letters, photographs, objects or
tangible things, not privileged, which constitute or contain evidence material to any matter involved in the
action and which are in his possession, custody or control;
 The provision on production and inspection of documents is one of the modes of discovery sanctioned
by the Rules of Court in order to enable not only the parties, but also the court to discover all the relevant and
material facts in connection with the case pending before it.
 In light of the general philosophy of full discovery of relevant facts, the unreceptive and negative attitude
by the respondent is abominable.
 The rules on discovery are accorded broad and liberal interpretation precisely to enable the parties to obtain
the fullest possible knowledge of the issues and facts, including those known only to their adversaries, in
order that trials may not be carried on in the dark.
 Undoubtedly, the trial court had effectively placed petitioners at a great disadvantage inasmuch as respondent
effectively suppressed relevant documents related to the transaction involved in the case a quo.
 Furthermore, the remedies of discovery encouraged and provided for under the Rules of Court to be able to
compel the production of relevant documents had been put to naught by the arbitrary act of the trial court.
 It must be remembered that litigation is essentially an abiding quest for truth undertaken not by the judge alone,
but jointly with the parties.
  Litigants, therefore, must welcome every opportunity to achieve this goal; they must act in good faith to
reveal documents, papers and other pieces of evidence material to the controversy.
 Courts, as arbiters and guardians of truth and justice, must not countenance any technical ploy to the detriment of
an expeditious settlement of the case or to a fair, full and complete determination on its merits.

DISPOSITIVE PORTION:

WHEREFORE, the motion for reconsideration is DENIED WITH FINALITY. SO ORDERED.

8. Zepeda vs. China Banking Corporation, 504 SCRA 126, 134, Failure to Attend depositions or to serve answers to
interrogatories

Facts:
 Spouses Zepeda filed a complaint for nullification of foreclosure proceedings and loan documents with damages
against respondent Chinabank before the Regional Trial Court
 They alleged that they obtained a loan in the amount of P5,800,000.00 from respondent secured by a Real Estate
Mortgage
 Petitioners subsequently encountered difficulties in paying their loan obligations hence they requested for
restructuring which was allegedly granted by Chinabank.
 Hence, they were surprised when respondent bank extrajudicially foreclosed the subject property
 Respondent bank was issued a Provisional Certificate of Sale and upon petitioners’ failure to redeem the property,
ownership was consolidated in its favor.
 According to petitioners, the foreclosure proceedings should be annulled for failure to comply with the posting and
publication requirements.
 Respondent bank’s motion to dismiss was denied, hence it filed an answer with special affirmative defenses and
counterclaim.
 It also filed a set of written interrogatories with 20 questions.
 In an Order dated April 1, 2004, the trial court denied Chinabank’s affirmative defenses for lack of merit as well as
its motion to expunge the complaint for being premature.
 Aggrieved, respondent bank filed a petition for certiorari under Rule 65 which was granted by the Court of Appeals.
 Chinabank’s affirmative defenses; they failed to answer Chinabank’s written in-terrogatories; and the complaint
states no cause of action.

Issue:
 Whether the complaint should be dismissed for failure of petitioners to answer respondent’s written interrogatories?

Ruling:
 NO
 It should be noted that respondent bank filed a motion to expunge the complaint based on Section 3(c) of Rule 29
which states:
o SEC. 3. Other consequences
o If any party or an officer or managing agent of a party refuses to obey an order made under section 1 of
this Rule requiring him to answer designated questions, or an order under Rule 27 to produce any document
or other thing for inspection, copying, or photographing or to permit it to be done, or to permit entry upon
land or other property, or an order made under Rule 28 requiring him to submit to a physical or mental
examination, the court may make such orders in regard to the refusal as are just, and among others the
following:
 (c) An order striking out pleadings or parts thereof, or staying further proceedings until the order is
obeyed, or dismissing the action or proceeding or any part thereof, or rendering a judgment by
default against the disobedient party; and x x x
 As we have explained in Arellano v. Court of First Instance of Sorsogon, the consequences enumerated in Section
3(c) of Rule 29 would only apply where the party upon whom the written interrogatories is served, refuses to answer
a particular question in the set of written interrogatories and despite an order compelling him to answer the particular
question, still refuses to obey the order.
 In the instant case, petitioners refused to answer the whole set of written interrogatories, not just a particular
question.
 Clearly then, respondent bank should have filed a motion based on Section 5 and not Section 3(c) of Rule 29.
Section 5 of Rule 29 reads:
o SEC. 5. Failure of party to attend or serve answers
o If a party or an officer or managing agent of a party willfully fails to appear before the officer who is to take
his deposition, after being served with a proper notice, or fails to serve answers to interrogatories submitted
 under Rule 25 after proper service of such interrogatories, the court on motion and notice, may strike out
all or any part of any pleading of that party, or dismiss the action or proceeding or any part thereof, or enter
a judgment by default against that party, and in its discretion, order him to pay reasonable expenses
incurred by the other, including attorney’s fees
 Due to respondent bank’s filing of an erroneous motion, the trial court cannot be faulted for ruling that the motion to
expunge was premature for lack of a prior application to compel compliance based on Section 3.
 This Court has long encouraged the availment of the various modes or instruments of discovery as embodied in
Rules 24 to 29 of the Rules of Court.
 In the case of Hyatt Industrial Manufacturing Corporation v. Ley Construction and Development Corporation, we
declared:
o Indeed, the importance of discovery procedures is well recognized by the Court. It approved A.M. No. 03-
1-09-SC on July 13, 2004 which provided for the guidelines to be observed by trial court judges and clerks
of court in the conduct of pre-trial and use of deposition-discovery measures. Under A.M. No. 03-1-09-SC,
trial courts are directed to issue orders requiring parties to avail of interrogatories to parties under Rule 45
and request for admission of adverse party under Rule 26 or at their discretion make use of depositions
under Rule 23 or other measures under Rule 27 and 28 within 5 days from the filing of the answer. The
parties are likewise required to submit, at least 3 days before the pre-trial, pre-trial briefs, containing among
others a manifestation of the parties of their having availed or their intention to avail themselves of discovery
procedures or referral to commissioners
 The imposition of sanctions under Section 5 is within the sound discretion of the trial court. Thus, in Insular Life
Assurance Co., Ltd. v. Court of Appeals, we held:
o The matter of how, and when, the above sanctions should be applied is one that primarily rests on the
sound discretion of the court where the case pends, having always in mind the paramount and overriding
interest of justice. For while the modes of discovery are intended to attain the resolution of litigations with
great expediency, they are not contemplated, however, to be ultimate causes of injustice. It behooves trial
courts to examine well the circumstances of each case and to make their considered determination
thereafter

9. Republic v. Francisco
G.R. No. 163089 Dec. 6, 2006
CALLEJO, SR., J.:
Principle: Subpoena

Facts:
- The Fact-Finding and Intelligence Bureau (FFIB) of the Office of the Ombudsman received an anonymous letter-complaint
regarding an alleged anomalous garbage collection contract between the Municipality of Bacoor, Cavite, with Hinterland
Freightliners, Inc., and other illegal transactions. In a newspaper report, reference was made to "Colorum Dumpsites"
against concerned Directors and the following illegal acts of the Municipal Mayor of Bacoor and his wife.
- For refusing to comply with the subpoena issued by the FFIB, the agents filed an administrative complaint for
grave misconduct against Municipal Mayor Jessie B. Castillo, Municipal Treasurer Salome Esagunde, Municipal
Accountant Jerry Makalatan, Municipal Personnel Head Emily de Castro and Municipal Planning Development
Officer Jesus Francisco. The case was docketed as OMB-ADM-0-00-0112 (OMB-0-00-0261) and was investigated by the
Administrative Adjudication Bureau of the Office of the Ombudsman.
- In their joint counter-affidavit, Makalatan, Francisco and De Castro alleged that when the investigators arrived in their office
on August 25, 1999, they were informed to keep silent about their (agents') presence. Being naïve of such kind of legal
procedure and considering the volume of the vital municipal documents the agents were requesting, they informed the
Mayor. After reading the subpoena, they noticed that the documents were not related to the subject matter of the
investigation as shown by the caption of the subpoena. They insisted that this violated the mandate of Section 3, Rule 21
of the Revised Rules of Civil Procedure and the well settled rule on subpoena duces tecum. They averred that the
documents demanded by the agents may be secured from the COA through the provincial auditor.

Issue: Whether there was proper refusal to comply with the sub poena

Ruling: No.
- The Office of the Ombudsman is empowered to administer oaths, issue subpoena and subpoena duces tecum, and take
testimony in any investigation or inquiry, including the power to examine and have access to bank accounts and records
which may be delegated to the deputy or its investigator to ensure the effective exercise or performance of the power,
functions, and duties therein as provided in the law. In any investigation under the law, the Ombudsman may examine and
access any record, file, document or paper in any office, agency or commission or tribunal.
- Delay or refusal to comply with the referral or directive of the Ombudsman or any of his deputies constitutes a
ground for administrative disciplinary action against the officers or employee concerned.
- The officer or employee concerned may be excused or justified for being unable to comply with the subpoena duces tecum.
However, the inability which excuses must be real. Self-created inability will not suffice; nor will passivity when reasonable
efforts might secure compliance. Any excuse or exception for non-compliance is distinctly exceptional being derogative of
the mandate of the law and must be established by clear and convincing evidence.

In the instant case, respondents were ordered by the Office of the Ombudsman, through the FFIB, to submit certified true
copies of the documents in their custody in connection with the on-going investigation against the Mayor and his wife. The
documents subject of the subpoena were public documents in the custody of respondents. They were mandated to comply
with the subpoena of the FFIB despite the Mayor's August 10, 1999 Memoranda prohibiting them from releasing important
documents/records in their respective departments without his prior approval. Such a Memorandum is contrary to R.A. No.
6770. The duty of respondents to comply with the subpoena of the FFIB cannot be made subject to or dependent
on the whims or caprice or prior approval of a higher officer. Indeed, in this case, the Mayor was unable to cite any law
vesting him with the power to prohibit the municipal officers from furnishing the Ombudsman with certified copies of public
documents in their custody without his prior approval.
- It must be stressed that the Mayor is mandated to ensure that all officials and employees of the municipality faithfully
discharge their duties and functions as provided by law and the Local Government Code. It appears, in this case, that the
Mayor issued his Memoranda in anticipation, perhaps to derail the investigation of the Office of the Ombudsman relative to
the complaints against him and his wife. By prohibiting respondents from complying with the subpoena, he prevented
the FFIB agents from performing their constitutionally-mandated duty.
- Respondents' request for the FFIB agents to ask the Mayor to allow them to release certified copies of the documents
cannot serve to support their claim of good faith. The FFIB agents were merely complying with the subpoena issued
by the FFIB. Moreover, their Mission Order did not require them to speak to the Mayor and secure prior approval before
releasing public documents. The Mayor cannot withhold the release of any public documents even if they may
incriminate him and his wife. Neither were respondents justified in withholding such documents from the FFIB, being as
they are documents for the benefit of the public and subject to public inspection.
If respondents, indeed, were in good faith, it behooved them to file a motion with the FFIB to question its order and claim
exemption from compliance with the subpoena because of the Mayor's Memoranda. In case of denial, respondents could
then appeal to the Ombudsman; if this remedy failed, they could then have sought judicial relief. Respondents had no
right to simply ignore the order and refuse to comply. Whether a witness has a reasonable excuse for failing to
respond to a subpoena duces tecum is to be justified by the court or tribunal or government entity that issued it
and not by the witness. While the witness may have a valid excuse for not showing the document sought by the subpoena,
he is still bound to produce it.
Respondents are not mere employees of the municipality. They were heads of departments. They should have
known that although the Mayor may have supervision over them, he had no power to prohibit them from complying
with the lawful order of the FFIB. Respondents are mandated to obey only the lawful orders of the Mayor, and are as
guilty as the former if they obey illegal orders. They knew that the Mayor had subsequently issued a Memorandum finally
allowing them to comply with the subpoena of the FFIB; however, respondents De Castro and Makalatan's compliance was
only partial, while respondent Francisco failed to comply. Such "half-hearted compliance" demonstrates respondents'
defiance of the FFIB's order, despite the volte face of the Mayor. This conduct cannot be tolerated.