GORGONIO PANDES VS HON. JOSE TEODORO, SR., GR NO.

L-6666, MAY 12, 1954

DOCTRINE: The fact that the mortgaged properties are in the hands of receiver appointed by
the court which tried the foreclosure suit does not prevent the same court from ordering the sale
of the aforesaid mortgaged properties, inasmuch as although the said properties are in custodia
legis by virtue of the judicial receivership, there cannot be any conflict of jurisdiction therein
because the court that ordered the sale thereof is the same which ordered that they be placed
under receivership.

Likewise, the Supreme Court held that the court, which ordered the placing of the mortgaged
property in the hands of a receiver in a foreclosure proceeding, has jurisdiction to order the sale
of said property at public auction even before the termination of the receivership.

FACTS:

On December 9, 1952, Uy Tiong Oh instituted in the Court of First Instance of Negros

Occidental Civil Case No. 2562, against Gorgonio Pandes, for the recovery of a sum of money.
Upon the posting of the corresponding bond, a writ of preliminary attachment was issued, on
motion of Uy Tiong Oh, "against the properties of the defendant not exempt from execution".

Then, the provincial sheriff issued a "Notice of Garnishment" upon "whatever right, interest and
participation the defendant Gorgonio Pandes has or might have in " a certain "partnership
between Uy Tiong Oh and Ester Pandes, the wife of the defendant, in connection with the Eden
Theater of San Carlos, Negros Occidental."

Thereafter, Gorgonio Pandes filed an "Answer to Notice of Garnishment of the Provincial

Sheriff", praying that said garnishment "be stayed" upon the ground, among others, that said
right, interest and participation "is involved in Civil Case No. 2371" of the same court, entitled
"Uy King Poe vs. Ester Pandes and Gorgonio Pandes." It would seem, also, that Gorgonio
Pandes had never sought any court action on his aforesaid "answer".

In due course, a decision was, subsequently, rendered in favor of Uy Tiong Oh in case No.
2562. Said decision having become final, the court ordered, on April 11, 1953, on motion of Uy
Tiong Oh, the issuance of the corresponding writ of execution and directed the provincial sheriff
to sell, at public auction, "whatever rights, interest and participation the defendant may have on
the property levied upon.”

After issuing the corresponding notice of auction sale, the provincial sheriff sold to Uy Tiong Oh
for P500.00, such right , interest and participation as Gorgonio Pandes has or might have in the
partnership. Prior thereto or on April 22, 1953, Gorgonio Pandes had moved for the
reconsideration of the order of April 11, 1953, upon the ground that the partnership in question
was under receivership and, being as such under custodia legis, said partnership and its assets
are not subject to garnishment. The motion for reconsideration having been denied by the court,
presided over by Hon. Jose Teodoro, Sr., Judge, Gorgonio Pandes instituted the
present certiorari proceedings.

ISSUE: Whether or not respondent Judge had exceeded his authority when he issued the order
of directing the provincial sheriff "to sell at public auction whatever rights, interest and
participation the defendants may have on the property levied upon . . . the proceeds thereof to
be applied in satisfaction of the judgment rendered in this case.”?

RESOLUTION:

No. The petition is dismissed.

The fact that the mortgaged properties are in the hands of receiver appointed by the court which
tried the foreclosure suit does not prevent the same court from ordering the sale of the aforesaid
mortgaged properties, inasmuch as although the said properties are in custodia legis by virtue
of the judicial receivership, there cannot be any conflict of jurisdiction therein because the court
that ordered the sale thereof is the same which ordered that they be placed under receivership.

Likewise, the Supreme Court held that the court, which ordered the placing of the mortgaged
property in the hands of a receiver in a foreclosure proceeding, has jurisdiction to order the sale
of said property at public auction even before the termination of the receivership.

For this reason, respondents maintain that petitioner is not entitled to the relief sought, the
garnishment and the sale under execution complained of, having been ordered, not only by the
same court of First Instance of Negros Occidental which had jurisdiction over the receivership,
but, also, by the same judge, respondent Jose Teodoro, Sr., who appointed the receiver.

This right, interest or participation, if any, is a property of Gorgonio Pandes, separate and
distinct from the properties of the partnership, which has a personality of its own, distinct from
that of its partners, and, certainly, of said Gorgonio Pandes. Such property, if any, of the latter,
is not under receivership. The receiver had no authority to take it under his custody and, in fact,
never had it in his possession or under his administration. Consequently, it is not in custodia
legis and is subject to levy, even without the permission of the court appointing the receiver.

PL UY REALTY CORPORATION VS ALS MANAGEMENT AND DEVELOPMENT

CORPORATION, GR NO. 166462, OCTOBER 24, 2012

DOCTRINE: The principle of res judicata may not be evaded by the mere expedient of including
an additional party to the first and second action. Only substantial identity is necessary to
warrant the application of res judicata. The addition or elimination of some parties does not alter
the situation.

There is substantial identity of parties when there is a community of interest between a party in
the first case and a party in the second case albeit the latter was not impleaded in the first case.

FACTS:

On September 3, 1980, PLU, as vendor, and ALS, as vendee, executed a Deed of

Absolute Sale with Mortgage covering a registered parcel of land located at F. Blumentritt
Street, Mandaluyong, Metro Manila. The purchase price for the land was set at PhP 8,166,705
payable, as follows:
 a. Upon execution of the Contract - P 500,000.00

b. Within 100 days thereafter, a downpayment equivalent to 24% (P1,960,000.00) of the

principal amount less the advance of P500,000.00 - 1,460,009.20

c. The balance of P6,206,695.80 together with interest of 12% per annum (estimated
interest included) on the diminishing balance shall be payable over a period of four (4)
years on or before the month and day of the first downpayment

The parties also stipulated on the eviction of informal settlers/ existing

occupants/squatters, the removal of which shall be for the sole expenses & responsibilities of
the VENDOR & that the VENDEE is authorized to withhold payment of the 1st 24% installment
unless the above-undertaking is done and completed to the satisfaction of the VENDEE;

Thereafter, the parties entered into an Agreement dated December 23, 1980 that all
accruals of interest as provided for in paragraph 2-c of the Deed of Sale with Mortgage will be
deferred and the subsequent payments of installments will correspondingly be extended to the
date the occupants/squatters will vacate the subject property. In the event the informal settlers
do not leave the property, PLU would reimburse ALS the following amounts:

a. All payments made, including the down payment

b. All costs of temporary/permanent improvements introduced by the SECOND PARTY

in the subject property

c. All damages suffered by the SECOND PARTY due to the refusal of the
occupants/squatters to vacate the premises.

On January 26, 1981, TCT No. 16721 was canceled and a new one, TCT No. 26048,
issued in the name of ALS. Subsequently, the parties executed a Partial Release of Mortgage
dated April 3, 1981 attesting to the payment by ALS of the first installment indicated in the
underlying deed. The relevant portion of the Partial Release of Mortgage reads:

1. Upon the execution of this document, the SECOND PARTY shall pay the net sum of THREE
HUNDRED NINETY FIVE THOUSAND PESOS (P395,000.00) after deducting expenses, to
complete the full payment of the first 24% installment.

2. The FIRST PARTY hereby executes a partial release of the mortgage to the extent of
TWENTY THOUSAND SQUARE METERS (20,000 sq.m.) in consideration of the advance
payment which would now amount to a total of P1,960,009.20, of a portion of the said property
indicated in the attached subdivision plan herewith x x x.

ALS, however, failed to pay the 2nd payment despite demands.

Thus, on August 25, 1982, PLU filed a Complaint against ALS for Foreclosure of
Mortgage and Annulment of Documents. In the complaint, PLU alleged having had entered into
an oral agreement with ALS whereby the latter "agreed to take over the task of ejecting the
squatters/occupants from the property covered by TCT No. 26048 issued in its name," adding
that, through the efforts of ALS, the property was already 90% clear of informal settlers.

On May 9, 1986, the Makati RTC rendered a Decision ruling that the obligation of PLU to
clear the property of informal settlers was superseded by an oral agreement between the parties
whereby ALS assumed the responsibility of ejecting said informal settlers. The Makati RTC,
however, declared that the removal of the informal settlers on the property is still a subsisting
and valid condition.

The trial court further ruled that because informal settlers still occupied 28% of the
property, the condition, as to their eviction, had not yet been complied with. For this reason, the
Makati RTC found the obligation of ALS to pay the balance of the purchase price has not yet
fallen due and demandable; thus, it dismissed the case for being premature.

ALS appealed the case to this Court primarily questioning the finding of the Makati RTC
that it had assumed the responsibility of ejecting the informal settlers on the property. The Court
issued a Resolution affirming the rulings of the CA and the Makati RTC. The resolution became
final and executory on February 7, 1990.

Sometime thereafter, PLU again filed a Complaint dated November 12, 1990 against
ALS for Judicial Foreclosure of Real Estate Mortgage under Rule 68, before the RTC. In the
complaint, PLU claimed that ALS had not yet completed the agreed 1st payment obligation
despite numerous demands.

In defense, ALS claims that the installment payments for the balance of the purchase
price of the property are not yet due and demandable, as the removal of the informal settlers, a
condition precedent for such payments to be demandable, is still to be completed. ALS further
avers that respondent Antonio Litonjua (Litonjua) cannot be made personally liable under the
Deed of Absolute Sale with Mortgage, not being a party thereto and as no ground exists for
piercing the veil of corporate fiction to make Litonjua, a corporate officer of ALS, liable. By way
of counterclaim, ALS alleged that because there were still informal settlers on the property, PLU
should be directed to reimburse ALS the payments that it already made, the cost of
improvements introduced by ALS on the property and for other damages.

In a Decision dated November 17, 1993, the Pasig RTC dismissed the case for being
premature. Furthermore, the trial court, citing Art. 1167 of the Civil Code, ruled that the
foreclosure of the mortgage is not the proper remedy, and that PLU should have caused the
ejectment of the informal settlers. Also, the court found no reason to render Litonjua personally
liable for the transaction of ALS as there was no ground to pierce the veil of corporate fiction.

From such Decision, PLU appealed to the CA which rendered the assailed Decision affirming
that of the Pasig RTC. PLU moved for a reconsideration of the CA Decision but was denied in
the assailed Resolution.

Hence, the instant petition.

ISSUE: Whether or not the instant petition is barred by res judicata?

RESOLUTION:

Yes, the petition shall be dismissed.

Res judicata embraces two concepts: (1) bar by prior judgment as enunciated in Rule 39,
Section 47(b) of the Rules of Civil Procedure; and (2) conclusiveness of judgment in Rule 39,
Section 47(c).
There is "bar by prior judgment" when, as between the first case where the judgment was
rendered and the second case that is sought to be barred, there is identity of parties, subject
matter, and causes of action. In this instance, the judgment in the first case constitutes an
absolute bar to the second action.

But where there is identity of parties in the first and second cases, but no identity of causes of
action, the first judgment is conclusive only as to those matters actually and directly
controverted and determined and not as to matters merely involved therein. This is the concept
of res judicata known as "conclusiveness of judgment." Stated differently, any right, fact or
matter in issue directly adjudicated or necessarily involved in the determination of an action
before a competent court in which judgment is rendered on the merits is conclusively settled by
the judgment therein and cannot again be litigated between the parties and their privies,
whether or not the claim, demand, purpose, or subject matter of the two actions is the same.

Thus, if a particular point or question is in issue in the second action, and the judgment will
depend on the determination of that particular point or question, a former judgment between the
same parties or their privies will be final and conclusive in the second if that same point or
question was in issue and adjudicated in the first suit. Identity of cause of action is not required
but merely identity of issue.

In the same Social Security Commission case, the Court enumerated the elements of res
judicata, to wit:

The elements of res judicata are: (1) the judgment sought to bar the new action must be final;
(2) the decision must have been rendered by a court having jurisdiction over the subject matter
and the parties; (3) the disposition of the case must be a judgment on the merits; and (4) there
must be as between the first and second action, identity of parties, subject matter, and causes
of action. Should identity of parties, subject matter, and causes of action be shown in the two
cases, then res judicata in its aspect as a "bar by prior judgment" would apply. If as between the
two cases, only identity of parties can be shown, but not identical causes of action, then res
judicata as "conclusiveness of judgment" applies. (Emphasis supplied.)

All the elements of res judicata, as a "bar by prior judgment," are present in the instant case.
The previous complaint for foreclosure of mortgage was dismissed by the trial court for being
premature in Civil Case No. 47438. The dismissal action, when eventually elevated to this Court
in G.R. No. 91656, was affirmed and the affirmatory resolution of the Court becoming final and
executory on February 7, 1990. Further, the element of identity of parties is considered existing
even though Litonjua was only impleaded in Civil Case No. 60221 and not in Civil Case No.
47438. Absolute identity of parties is not required for res judicata to apply; substantial identity is
sufficient. The Court articulated this principle was raised in Cruz v. Court of Appeals38 in this
wise:

The principle of res judicata may not be evaded by the mere expedient of including an additional
party to the first and second action. Only substantial identity is necessary to warrant the
application of res judicata. The addition or elimination of some parties does not alter the
situation.

There is substantial identity of parties when there is a community of interest between a party in
the first case and a party in the second case albeit the latter was not impleaded in the first case.
ANDREW TAN VS COURT OF APPEALS, GR NO. 142401, AUGUST 20, 2001

DOCTRINE: Under the doctrine of conclusiveness of judgment, which is also known as

"preclusion of issues" or "collateral estoppel" issues actually and directly resolved in a former
suit cannot again be raised in any future case between the same parties involving a different
cause of action.

Although the action instituted in this case (collection of a sum of money) is technically different
from that action instituted by Andrew Tan before the Regional Trial Court of Dagupan (for
annulment of document), "the concept of conclusiveness of judgment still applies because
under this principle, the identity of causes of action is not required but merely identity of issues.
Simply put, conclusiveness of judgment bars the relitigation of particular facts or issues in
another litigation between the same parties on a different claim or cause of action."

FACTS:

Wu Sen Woie, a Taiwanese national, and Andrew Tan, a Filipino, first met in Taiwan sometime
in August 1987 through Kua Bei Tie. Tan proposed that Sen Woie invest money in the hatchery
business he had started, and Sun Woie parted with the amount of $80,000.00. Repaid only in
the amount of $10,000.00, he lodged a complaint before the National Bureau of Investigation
(NBI) to recover the balance of $70,000.00. Before the NBI, defendant Andrew Tan and his
sister Helen Go signed a Joint Affidavit of Undertaking acknowledging their obligation to pay.

Tan, however, claims that he was coerced into signing the above Undertaking. He then assailed
the validity of said Undertaking in Civil Case No. D-9864 entitled 'Andrew Tan, plaintiff vs. Wu
Sen Woei, which he filed before the Regional Trial Court of Dagupan City. The RTC found
Tan's and Go's consent to the Undertaking as vitiated and rendered judgment declaring the
Undertaking as a nullity. The decision was appealed to this Court in CA-G.R. CV No. 47880
where the court reversed and set aside the appealed judgment, and dismissed Andrew Tan's
complaint.

The Court of Appeals held in its Decision that, based on the doctrine of conclusiveness of
judgment, Tan's claim that the Affidavit of Undertaking had been executed under duress was
rendered ineffective by the ruling in CA-GR CV No. 47880. The CA had ruled therein that the
said Affidavit was an admission against interest, a clear acknowledgment by Tan of his
obligation to Wu Sen Woei. Thus, the appellate court deemed it pointless to determine whether
there was, instead, a consummated partnership between the two parties.

Through a Petition2 for Review under Rule 45 of the Rules of Court, Andrew Tan challenges the
Decision3 rendered by the Court of Appeals4 in CA-GR CV No. 58086 and its March 8, 2000
Resolution5denying reconsideration.

ISSUE: Whether or not the Court of Appeals committed a grave and serious error of judgment in
applying the doctrine of conclusiveness of judgment?

RESOLUTION:
No. The petition is without merit.

The CA's earlier Decision concerning the validity of Andrew Tan's Affidavit of Undertaking has
become conclusive on the parties, pursuant to Section 47 (c) of Rule 39 of the Rules of Court.
The parties are bound by the matters adjudged and those that are actually and necessarily
included therein. Under the doctrine of conclusiveness of judgment, which is also known as
"preclusion of issues" or "collateral estoppel" issues actually and directly resolved in a former
suit cannot again be raised in any future case between the same parties involving a different
cause of action.

The concept clearly applies to the present case, because petitioner again seeks refuge in the
alleged nullity of the same Affidavit of Undertaking which, as earlier mentioned, was already
ruled upon with finality. In other words, the question on the validity of the Affidavit has been
settled. The same question, therefore, cannot be raised again even in a different proceeding
involving the same parties.

Although the action instituted in this case (collection of a sum of money) is technically different
from that action instituted by Andrew Tan before the Regional Trial Court of Dagupan (for
annulment of document), "the concept of conclusiveness of judgment still applies because
under this principle, the identity of causes of action is not required but merely identity of issues.
Simply put, conclusiveness of judgment bars the relitigation of particular facts or issues in
another litigation between the same parties on a different claim or cause of action."

Significantly, petitioner no longer questioned the CA Decision in CA-GR CV No. 47880. Thus, it
has become final and executory and no longer subject to review.

Moreover, petitioner's assertion that the Affidavit of Undertaking had been executed under
duress is contradicted by the events that took place following its execution. Petitioner did not
immediately question its validity. In fact, of the $70,000 that he undertook to pay Wu Sen Woei,
the former has been able to make payments in the amount of $25,000, pursuant to the terms of
the Affidavit. His counsel even executed a letter requesting an extension of time and a reduction
of the monthly These circumstances clearly negate any infirmity in the Affidavit as well as the
absence of any obligation on the part of petitioner to fulfill his liability therein.