G.R. No.

127198 May 16, 2005

LAND BANK OF THE PHILIPPINES, petitioner,

vs.
HON. ELI G. C. NATIVIDAD, Presiding Judge of the Regional Trial Court, Branch 48, San
Fernando, Pampanga, and JOSE R. CAGUIAT represented by Attorneys-in-fact JOSE T.
BARTOLOME and VICTORIO MANGALINDAN, respondents.

DECISION

TINGA, J.:

This is a Petition for Review1 dated December 6, 1996 assailing the Decision2 of the Regional Trial
Court3 dated July 5, 1996 which ordered the Department of Agrarian Reform (DAR) and petitioner
Land Bank of the Philippines (Land Bank) to pay private respondents the amount of P30.00 per
square meter as just compensation for the State’s acquisition of private respondents’ properties
under the land reform program.

The facts follow.

On May 14, 1993, private respondents filed a petition before the trial court for the determination of
just compensation for their agricultural lands situated in Arayat, Pampanga, which were acquired by
the government pursuant to Presidential Decree No. 27 (PD 27). The petition named as respondents
the DAR and Land Bank. With leave of court, the petition was amended to implead as co-
respondents the registered tenants of the land.

After trial, the court rendered the assailed Decision the dispositive portion of which reads:

WHEREFORE, judgment is hereby rendered in favor of petitioners and against respondents,

ordering respondents, particularly, respondents Department of Agrarian Reform and the
Land Bank of the Philippines, to pay these lands owned by petitioners and which are the
subject of acquisition by the State under its land reform program, the amount of THIRTY
PESOS (P30.00) per square meter, as the just compensation due for payment for same
lands of petitioners located at San Vicente (or Camba), Arayat, Pampanga.

Respondent Department of Agrarian Reform is also ordered to pay petitioners the amount of
FIFTY THOUSAND PESOS (P50,000.00) as Attorney’s Fee, and to pay the cost of suit.

SO ORDERED.4

DAR and Land Bank filed separate motions for reconsideration which were denied by the trial court
in its Order5 dated July 30, 1996 for being pro forma as the same did not contain a notice of
hearing. Thus, the prescriptive period for filing an appeal was not tolled. Land Bank consequently
failed to file a timely appeal and the assailed Decision became final and executory.

Land Bank then filed a Petition for Relief from Order Dated 30 July 1996,6 citing excusable
negligence as its ground for relief. Attached to the petition for relief were two affidavits of merit
claiming that the failure to include in the motion for reconsideration a notice of hearing was due to
accident and/or mistake.7 The affidavit of Land Bank’s counsel of record notably states that "he
simply scanned and signed the Motion for Reconsideration for Agrarian Case No. 2005, Regional
Trial Court of Pampanga, Branch 48, not knowing, or unmindful that it had no notice of hearing" 8 due
to his heavy workload.

The trial court, in its Order9 of November 18, 1996, denied the petition for relief because Land Bank
lost a remedy in law due to its own negligence.

In the instant petition for review, Land Bank argues that the failure of its counsel to include a notice
of hearing due to pressure of work constitutes excusable negligence and does not make the motion
for reconsideration pro forma considering its allegedly meritorious defenses. Hence, the denial of its
petition for relief from judgment was erroneous.

According to Land Bank, private respondents should have sought the reconsideration of the DAR’s
valuation of their properties. Private respondents thus failed to exhaust administrative remedies
when they filed a petition for the determination of just compensation directly with the trial court. Land
Bank also insists that the trial court erred in declaring that PD 27 and Executive Order No. 228 (EO
228) are mere guidelines in the determination of just compensation, and in relying on private
respondents’ evidence of the valuation of the properties at the time of possession in 1993 and not on
Land Bank’s evidence of the value thereof as of the time of acquisition in 1972.

Private respondents filed a Comment10 dated February 22, 1997, averring that Land Bank’s failure to
include a notice of hearing in its motion for reconsideration due merely to counsel’s heavy workload,
which resulted in the motion being declared pro forma, does not constitute excusable negligence,
especially in light of the admission of Land Bank’s counsel that he has been a lawyer since 1973 and
has "mastered the intricate art and technique of pleading."

Land Bank filed a Reply11 dated March 12, 1997 insisting that equity considerations demand that it
be heard on substantive issues raised in its motion for reconsideration.

The Court gave due course to the petition and required the parties to submit their respective
memoranda.12 Both parties complied.13

The petition is unmeritorious.

At issue is whether counsel’s failure to include a notice of hearing constitutes excusable negligence
entitling Land Bank to a relief from judgment.

Section 1, Rule 38 of the 1997 Rules of Civil Procedure provides:

Sec. 1. Petition for relief from judgment, order, or other proceedings.—When a judgment or
final order is entered, or any other proceeding is thereafter taken against a party in any court
through fraud, accident, mistake, or excusable negligence, he may file a petition in such
court and in the same case praying that the judgment, order or proceeding be set aside.

As can clearly be gleaned from the foregoing provision, the remedy of relief from judgment can only
be resorted to on grounds of fraud, accident, mistake or excusable negligence. Negligence to be
excusable must be one which ordinary diligence and prudence could not have guarded against.14

Measured against this standard, the reason profferred by Land Bank’s counsel, i.e., that his heavy
workload prevented him from ensuring that the motion for reconsideration included a notice of
hearing, was by no means excusable.
Indeed, counsel’s admission that "he simply scanned and signed the Motion for Reconsideration for
Agrarian Case No. 2005, Regional Trial Court of Pampanga, Branch 48, not knowing, or unmindful
that it had no notice of hearing" speaks volumes of his arrant negligence, and cannot in any manner
be deemed to constitute excusable negligence.

The failure to attach a notice of hearing would have been less odious if committed by a greenhorn
but not by a lawyer who claims to have "mastered the intricate art and technique of pleading."15

Indeed, a motion that does not contain the requisite notice of hearing is nothing but a mere scrap of
paper. The clerk of court does not even have the duty to accept it, much less to bring it to the
attention of the presiding judge.16 The trial court therefore correctly considered the motion for
reconsideration pro forma. Thus, it cannot be faulted for denying Land Bank’s motion for
reconsideration and petition for relief from judgment.

It should be emphasized at this point that procedural rules are designed to facilitate the adjudication
of cases. Courts and litigants alike are enjoined to abide strictly by the rules. While in certain
instances, we allow a relaxation in the application of the rules, we never intend to forge a weapon for
erring litigants to violate the rules with impunity. The liberal interpretation and application of rules
apply only in proper cases of demonstrable merit and under justifiable causes and circumstances.
While it is true that litigation is not a game of technicalities, it is equally true that every case must be
prosecuted in accordance with the prescribed procedure to ensure an orderly and speedy
administration of justice. Party litigants and their counsel are well advised to abide by, rather than
flaunt, procedural rules for these rules illumine the path of the law and rationalize the pursuit of
justice.17

Aside from ruling on this procedural issue, the Court shall also resolve the other issues presented by
Land Bank, specifically as regards private respondents’ alleged failure to exhaust administrative
remedies and the question of just compensation.

Land Bank avers that private respondents should have sought the reconsideration of the DAR’s
valuation instead of filing a petition to fix just compensation with the trial court.

The records reveal that Land Bank’s contention is not entirely true. In fact, private respondents did
write a letter18 to the DAR Secretary objecting to the land valuation summary submitted by the
Municipal Agrarian Reform Office and requesting a conference for the purpose of fixing just
compensation. The letter, however, was left unanswered prompting private respondents to file a
petition directly with the trial court.

At any rate, in Philippine Veterans Bank v. Court of Appeals,19 we declared that there is nothing
contradictory between the DAR’s primary jurisdiction to determine and adjudicate agrarian reform
matters and exclusive original jurisdiction over all matters involving the implementation of agrarian
reform, which includes the determination of questions of just compensation, and the original and
exclusive jurisdiction of regional trial courts over all petitions for the determination of just
compensation. The first refers to administrative proceedings, while the second refers to judicial
proceedings.

In accordance with settled principles of administrative law, primary jurisdiction is vested in the DAR
to determine in a preliminary manner the just compensation for the lands taken under the agrarian
reform program, but such determination is subject to challenge before the courts. The resolution of
just compensation cases for the taking of lands under agrarian reform is, after all, essentially a
judicial function.20
Thus, the trial did not err in taking cognizance of the case as the determination of just compensation
is a function addressed to the courts of justice.

Land Bank’s contention that the property was acquired for purposes of agrarian reform on October
21, 1972, the time of the effectivity of PD 27, ergo just compensation should be based on the value
of the property as of that time and not at the time of possession in 1993, is likewise erroneous.
In Office of the President, Malacañang, Manila v. Court of Appeals, 21 we ruled that the seizure of the
landholding did not take place on the date of effectivity of PD 27 but would take effect on the
payment of just compensation.

Under the factual circumstances of this case, the agrarian reform process is still incomplete as the
just compensation to be paid private respondents has yet to be settled. Considering the passage of
Republic Act No. 6657 (RA 6657)22 before the completion of this process, the just compensation
should be determined and the process concluded under the said law. Indeed, RA 6657 is the
applicable law, with PD 27 and EO 228 having only suppletory effect, conformably with our ruling
in Paris v. Alfeche.23

Section 17 of RA 6657 which is particularly relevant, providing as it does the guideposts for the
determination of just compensation, reads as follows:

Sec. 17. Determination of Just Compensation.—In determining just compensation, the cost
of acquisition of the land, the current value of like properties, its nature, actual use and
income, the sworn valuation by the owner, the tax declarations, and the assessment made
by government assessors shall be considered. The social and economic benefits contributed
by the farmers and the farm-workers and by the Government to the property as well as the
non-payment of taxes or loans secured from any government financing institution on the said
land shall be considered as additional factors to determine its valuation.

It would certainly be inequitable to determine just compensation based on the guideline provided by
PD 27 and EO 228 considering the DAR’s failure to determine the just compensation for a
considerable length of time. That just compensation should be determined in accordance with RA
6657, and not PD 27 or EO 228, is especially imperative considering that just compensation should
be the full and fair equivalent of the property taken from its owner by the expropriator, the equivalent
being real, substantial, full and ample.24

In this case, the trial court arrived at the just compensation due private respondents for their
property, taking into account its nature as irrigated land, location along the highway, market value,
assessor’s value and the volume and value of its produce. This Court is convinced that the trial court
correctly determined the amount of just compensation due private respondents in accordance with,
and guided by, RA 6657 and existing jurisprudence.

WHEREFORE, the petition is DENIED. Costs against petitioner.

SO ORDERED.
G.R. No. 132767 January 18, 2000

PHILIPPINE VETERANS BANK, petitioner,

vs.
THE HON. COURT OF APPEALS, HON. SECRETARY OF THE DEPT. OF AGRARIAN REFORM,
DEPT. OF AGRARIAN REFORM ADJUDICATION BOARD, DAVAO CITY and LAND BANK OF
THE PHILIPPINES, respondents.

MENDOZA, J.:

This is a petition for review of the decision of the Court of Appeals, dated August 28, 1997, affirming
1

the dismissal by the Regional Trial Court, Branch 2, Tagum, Davao, of the petition for judicial
determination of the just compensation filed by petitioner for the taking of its property under the
Comprehensive Agrarian Reform Program.

The facts are as follows:

Petitioner Philippine Veterans Bank owned four parcels of land in Tagum, Davao, which are covered
by Transfer Certificates of Title Nos. T-38666, T-38667, T-6236, and T-27591. The lands were taken
by the Department of Agrarian Reform for distribution to landless farmers pursuant to the
Comprehensive Agrarian Reform Law (R.A. No. 6657). Dissatisfied with the valuation of the land
made by respondents Land Bank of the Philippines and the Department of Agrarian Reform
Adjudication Board (DARAB), petitioner filed a petition for a determination of the just compensation
for its property. The petition was filed on January 26, 1994 with the Regional Trial Court, Branch 2,
Tagum, Davao, which on February 23, 1995, dismissed the petition on the ground that it was filed
beyond the 15-day reglementary period for filing appeals from the orders of the DARAB. Its
order states in pertinent parts:
2

Since this case was filed only on January 26, 1994, the fifteen-day period provided for under
Section 51 of Republic Act 6657 which is the Comprehensive Agrarian Reform Law within
which to appeal, already lapsed.

Sec. 51 of Republic Act No. 6657 provides:

Sec. 51. Finality of Determination. — Any case or controversy before it (DAR) shall
be decided within thirty (30) days after it is submitted for resolution. Only one (1)
motion for reconsideration shall be allowed. Any order, ruling or decision shall be
final after the lapse of fifteen (15) days from receipt of a copy thereof.

On appeal to the Court of Appeals, the decision was affirmed. It was held that:

Jurisdiction over land valuation cases is lodged in the Department of Agrarian Reform
Adjudication Board, as is plainly provided under Rule II of the DARAB Revised Rules of
Procedure.

Sec. 1. Primary and Exclusive Original and Appellate Jurisdiction. The Board shall
have primary and exclusive jurisdiction, both original and appellate, to determine and
adjudicate all agrarian disputes, involving the implementation of the Comprehensive
Agrarian Reform Program (CARP) under Republic Act No. 6657, Executive Order
Nos. 228, 229, and 129-A, Republic Act No. 3844 as amended by Republic Act No.
6389, Presidential Decree No. 27 and other agrarian laws and their implementing
 rules and regulations. Specifically, such jurisdiction shall include but not be limited to
the following:

xxx xxx x x x.

b) The valuation of land, and determination and payment of just compensation, fixing
and collection of lease rentals, disturbance compensation, amortization payments,
and similar disputes concerning the functions of the Land Bank of the Philippines.

xxx xxx xxx

The above provision does not negate the original and exclusive jurisdiction vested in Special
Agrarian Court over all petitions for the determination of just compensation to landowners as
provided in Section 51 of R.A. 6657.

Note, however, must be taken of Rule XIII, Section 11 of the DARAB Rules of Procedure,
which specifically states that,

The decision of the Adjudicator on land valuation and preliminary determination and
payment of just compensation shall not be appealable to the Board but shall be
brought directly to the Regional Trial Court designated as a Special Agrarian Courts
within fifteen (15) days from the receipt of the notice thereof. Any party shall be
entitled to only one motion for reconsideration.

xxx xxx xxx

In pursuance thereof, it is clear that the right of a landowner who disagrees with the valuation
fixed by the DAR to file a petition for the judicial fixing of just compensation before special
agrarian courts must be exercised within the period provided in Rule XIII, Section 11. 1âwphi1.nêt

In this case, appellant neither gives information regarding the date of its receipt of the
questioned Order of the DAR Provincial Adjudicator, nor disputes the conclusion made by
the trial court that, "(s)ince this case was filed only on January 26, 1994, the fifteen-day
period provided for under Section 51 of Republic Act 6657 which is the Comprehensive
Agrarian Reform Law within which to appeal already lapsed". The court a quo's conclusion
therefore stands. It did not commit an error in dismissing the petition filed by Philippine
Veterans Bank for having been filed out of time. 3

Petitioner filed a motion for reconsideration, but its motion was likewise denied. Hence, this petition
for review. Petitioner raises the following issue:

SHOULD A PETITION FOR THE JUDICIAL FIXING OF JUST COMPENSATION BEFORE

SPECIAL AGRARIAN COURT BE [FILED] WITHIN THE PERIOD PROVIDED IN RULE XIII,
SECTION 11 OF THE DARAB RULES OF PROCEDURE AND BEFORE THE DECISION
OF THE DAR PROVINCIAL ADJUDICATOR BECOMES FINAL AND EXECUTORY?

Petitioner argues that DAR adjudicators have no jurisdiction to determine the just compensation for
the taking of lands under the Comprehensive Agrarian Reform Program, because such jurisdiction is
vested in Regional Trial Courts designated as Special Agrarian Courts and, therefore, a petition for
the fixing of just compensation can be filed beyond the 15-day period of appeal provided from the
decision of the DAR adjudicator.
On the other hand, respondents argue that actions for the fixing of just compensation must be filed in
the appropriate courts within 15 days from receipt of the decision of the DAR adjudicator, otherwise
such decision becomes final and executory, pursuant to §51 of R.A. No. 6657.

Petitioner's contention has no merit.

The pertinent provisions of R.A. No. 6657 provides:

Sec. 50 Quasi-Judicial Power of the DAR. — The DAR is hereby vested with primary
jurisdiction to determine and adjudicate agrarian reform matters involving the implementation
of agrarian reform, except those falling under the exclusive jurisdiction of the Department of
Agriculture (DA) and the Department of Environment and Natural Resources (DENR). . . .

Sec. 57 Special Jurisdiction. — The Special Agrarian Courts shall have original and
exclusive jurisdiction over all petitions for the determination of just compensation to
landowners, and the prosecution of all criminal offenses under this Act. The Rules of Court
shall apply to all proceedings before the Special Agrarian Courts, unless modified by this Act.

The Special Agrarian Courts shall decide all appropriate cases under their special jurisdiction
within thirty (30) days from submission of the case for decision.

There is nothing contradictory between the provision of §50 granting the DAR primary jurisdiction to
determine and adjudicate "agrarian reform matters" and exclusive original jurisdiction over "all
matters involving the implementation of agrarian reform," which includes the determination of
questions of just compensation, and the provision of §57 granting Regional Trial Courts "original and
exclusive jurisdiction" over (1) all petitions for the determination of just compensation to landowner,
and (2) prosecutions of criminal offenses under R.A. No. 6657. The first refers to administrative
4

proceedings, while the second refers to judicial proceedings. Under R.A. No. 6657, the Land Bank of
the Philippines is charged with the preliminary determination of the value of lands placed under land
reform program and the compensation to be paid for their taking. It initiates the acquisition of
agricultural lands by notifying the landowner of the government's intention to acquire his land and the
valuation of the same as determined by the Land Bank. Within 30 days from receipt of notice, the
5

landowner shall inform the DAR of his acceptance or rejection of the offer. In the event the
6

landowner rejects the offer, a summary administrative proceeding is held by the provincial (PARAD),
the regional (RARAD) or the central (DARAB) adjudicator, as the case may be, depending on the
value of the land, for the purpose of determining the compensation for the land. The landowner, the
Land Bank, and other interested parties are then required to submit evidence as to the just
compensation for the land. The DAR adjudicator decides the case within 30 days after it is submitted
for decision. If the landowner finds the price unsatisfactory, he may bring the matter directly to the
7

appropriate Regional Trial Court.8

To implement the provisions of R.A. No. 6657, particularly §50 thereof, Rule XIII, §11 of the DARAB
Rules of Procedure provides:

Land Valuation Determination and Payment of Just Compensation. — The decision of the
Adjudicator on land valuation and preliminary determination and payment of just
compensation shall not be appealable to the Board but shall be brought directly to the
Regional Trial Courts designated as Special Agrarian Courts within fifteen (15) days from
receipt of the notice thereof. Any party shall be entitled to only one motion for
reconsideration.
As we held in Republic v. Court of Appeals, this rule is an acknowledgment by the DARAB that the
9

power to decide just compensation cases for the taking of lands under R.A. No. 6657 is vested in the
courts. It is error to think that, because of Rule XIII, §11, the original and exclusive jurisdiction given
to the courts to decide petitions for determination of just compensation has thereby been
transformed into an appellate jurisdiction. It only means that, in accordance with settled principles of
administrative law, primary jurisdiction is vested in the DAR as an administrative agency to
determine in a preliminary manner the reasonable compensation to be paid for the lands taken
under the Comprehensive Agrarian Reform Program, but such determination is subject to challenge
in the courts.

The jurisdiction of the Regional Trial Courts is not any less "original and exclusive" because the
question is first passed upon by the DAR, as the judicial proceedings are not a continuation of the
administrative determination. For that matter, the law may provide that the decision of the DAR is
final and unappealable. Nevertheless, resort to the courts cannot be foreclosed on the theory that
courts are the guarantors of the legality of administrative action.10

Accordingly, as the petition in the Regional Trial Court was filed beyond the 15-day period provided
in Rule XIII, §11 of the Rules of Procedure of the DARAB, the trial court correctly dismissed the case
and the Court of Appeals correctly affirmed the order of dismissal.

WHEREFORE, the decision of the Court of Appeals is AFFIRMED. 1âwphi1.nêt

SO ORDERED.

G.R. No. 140529 September 6, 2001

JOSE P. LOPEZ, JR., petitioner,

vs.
OFFICE OF THE OMBUDSMAN, HON. ANIANO A. DESIERTO and HON. MARGARITO P.
GERVACIO, JR. in their official capacities as Ombudsman and Deputy Ombudsman for
Mindanao, respectively, and the Sandiganbayan, respondents.

GONZAGA-REYES, J.:

Before us is a Petition for Mandamus seeking: 1) the dismissal of Ombudsman Case No. OMB-3-93-
2793 (now Criminal Cases Nos. 25247-25226); and 2) the issuance of a clearance in favor of
petitioner Jose P. Lopez, Jr.

The facts as narrated in the memorandum of petitioner are:

"1. The petitioner is presently the Administrative Officer of the Department of Education,
Culture and Sports (DECS), Region XII, Cotabato City.

Because of the exigency of the service, the petitioner temporarily stays in Cotabato City
although he is a resident of Parañaque City.

2. On June 30, 1959, the petitioner started working with the DECS as a classroom teacher.
Through hard work, exemplary performance and continuous studies, he was promoted and
assigned to different positions such as Special Education Teacher; Child and Youth
Specialist; 2nd Lt., 36 Battalion Combat Team, Philippine Army (Reserved Force); Asst.
Director and concurrent Director, Child and Youth Research Center (now a defunct office);
and finally, he was appointed as Administrative Officer V, DECS-Region XII, Cotabato City.

3. Among the tasks of the petitioner as Administrative Officer V is to determine whether

certain expenses are necessary in the attainment of the objectives of the DECS-Region XII
and to pass upon, review and evaluate documents and other supporting papers submitted to
him in relation to his duties.

4. Between 1992 and 1993, DECS-Region XII ordered several pieces of laboratory
equipment and apparati requested by different school divisions of the region.

5. The concerned officers of DECS-Region XII submitted to the petitioner the documents
covering the transactions.

6. After careful scrutiny of the documents submitted to him, the petitioner affixed his
signature on the disbursements vouchers that were accompanied by Purchase Orders,
Sales Invoices, Delivery/Memorandum Receipts and proof that the transactions were post
audited by the COA Resident Auditor who found them in order.

7. Disregarding the findings of the COA Resident Auditor - DECS Region XII, Cotabato City,
who post audited the transactions and found them in order, for reasons of his own, the COA
Regional Director formed a Special Audit Team to investigate and audit the transactions.

8. Without seeking the presence of the concerned officials and employees of DECS – Region
XII, the COA Special Audit Team conducted an audit of the transactions.

9. On December 20, 1993, the members of the COA Special Audit Team submitted to the
COA Regional Director-Region XII, their Joint Affidavit claiming alleged deficiencies in the
transactions of DECS – Region XII implicating thereto the petitioner and some concerned
officials and employees of DECS-Region XII.

10. Dispensing conducting an exit conference and inviting the petitioner to clarify the
allegations of the COA Special Audit Team in their Joint Affidavit-Complaint, in post-haste
the COA Regional Directors indorsed it to the Office of the Ombudsman-Mindanao for
preliminary investigation.

11. The Office of Ombudsman-Mindanao docketed the complaint as Case No. 3-93-27791,
entitled "Commission on Audit vs. Makil Pundaodaya, et al.," for Falsification of Documents
by Public Officers."

12. In her Order dated March 1, 1994, Graft Investigation Officer (GIO) Marie Dinah
Tolentino directed the petitioner to submit a Counter-Affidavit without informing him of his
constitutional right to counsel.

13. On April 14, 1994, without the assistance of counsel, the petitioner wrote the Office of the
Ombudsman-Mindanao requesting for an extension of ten (10) days from April 19, 1994 to
submit his Counter-Affidavit.
 14. On April 19, 1994, Atty. Edgardo A. Camello, counsel for Makil Pundaodaya and the
other respondents in Case No. OMB-3-93-8791 filed a Motion for Extension of Time to
submit their Counter-Affidavits.

15. On April 22, 1994, without the assistance of counsel, the petitioner submitted to the
Office of Ombudsman-Mindanao his Counter-Affidavit he personally prepared denying
specifically each and every criminal act attributed to him by the Commission on Audit.

16. Although the petitioner did not submit any written statement authorizing Atty. Camello to
represent him in Case No. OMB 3-93-8791, the Office of the Ombudsman-Mindanao
erroneously assumed or deliberately made to appear that he was represented by said
attorney. As a consequence thereof, the Office of Ombudsman-Mindanao did not notify him
of the progress of the preliminary investigation. In fact, it did not issue any order directing
COA, Region XII to furnish him with a copy of the latter’s Reply-Affidavit, which explained
why petitioner could not be expected to submit a Rejoinder to rebut the issues raised in said
Reply-Affidavit; to summon and compel witnesses to appear and testify before the Graft
Investigation Officer or to bring books, documents and other records relative to the
transactions under their control and to secure the attendance or presence of any absent or
recalcitrant witness.

17. More than four (4) years after he submitted his Counter-Affidavit, the petitioner was
surprised that, without preliminary investigation and clarificatory question asked, on July 17,
1998, the Office of the Ombudsman-Mindanao terminated the preliminary investigation
recommending that he, together with the other respondents in Case No. OMB 3-93-9791, be
prosecuted for violation of Sec. 3(e) and (g) of the Anti-Graft and Corrupt Practices Act.

18. Within the reglementary period, without the assistance of counsel, the petitioner sent a
letter to the Office of the Ombudsman-Mindanao dated June 8, 1999 seeking the
reconsideration of the Resolution in Case No. OMB 33-93-2791 wherein he stressed that he
was deprived of due process and that there was inordinate delay in the resolution of the
preliminary investigation; and there was no exit conference wherein he could have explained
to the Graft Investigation Officer his exculpatory participation in the transactions investigated.
In addition, he also submitted to the Office of the Ombudsman-Mindanao a Motion for
Reconsideration or Reinvestigation reiterating the allegations mentioned in his letter dated
June 8, 1999. Unfortunately, said Motion for Reconsideration or Reinvestigation was not
acted upon by the Office of the Ombudsman-Mindanao by giving the excuse that its
Resolution was already forwarded to Ombudsman Aniano Desierto."1

On the other hand, the facts as narrated in the Memorandum of the Office of the Ombudsman are as
follows:

"Criminal Cases Nos. 25247 to 25276 stemmed from a special audit conducted by the
Commission on Audit (COA), Region XII relative to the purchase by the Department of
Education, Culture and Sports (DECS), Region XII Office, Cotabato City of school equipment
and laboratory apparati. The report on the special audit was received by the Office of the
Ombudsman, Mindanao on December 22, 1993. Finding the audit report sufficient to conduct
a preliminary investigation the same was docketed as Case No. OMB-3-93-2791.

In an Order dated March 1, 1994, Graft Investigation Officer (GIO) Marie Dinah Tolentino
directed the concerned public officials, among whom was herein petitioner, to submit their
Counter-Affidavits and controverting evidences within ten days from receipt of the Order and
 to furnish a copy of their counter-Affidavits to the complainant. The latter was given the same
period of ten (10) days to file their reply to the Counter-Affidavits.

On April 19, 1994 the Office of the Ombudsman, Mindanao received a pleading denominated
as "APPEARANCE With Motion for Extension of Time to Submit Counter-Affidavits" from
Atty. Edgardo A. Camello, counsel for the respondents in Case No. OMB-3-93-2791. The
Office of the Ombudsman, Mindanao granted the motion for extension and gave the
respondents until May 4, 1994 within which to submit their Counter-Affidavits.

On May 10, 1994 the Office of the Ombudsman, Mindanao received the Counter-Affidavits of
the respondents.

On August 2, 1994 the Office of the Ombudsman, Mindanao was informed through the letter
of COA Director Eugenio G. Fernandez that the COA was not furnished by the respondents
in Case No. OMB-3-93-2791 of their Counter-Affidavits.

Subsequently, GIO Tolentino issued an Order dropping Alimot Lao Arumpac from the case in
view of his death. The COA on the other hand was directed to submit its Reply-Affidavit
within ten days from receipt of the Order.

On January 11, 1995 the Office of the Ombudsman, Mindanao received a telegram from
COA, Region XII Office requesting that it be allowed until February 29, 1995 within which to
submit its Reply-Affidavit on the ground that the audit team leader and members who
conducted the special audit of DECS, Region XII Office were preparing for their annual audit
report.

On February 29, 1995 the Office of the Ombudsman, Mindanao received the Reply-Affidavit
of COA.

In a Resolution dated July 17, 1998 GIO Rachelle L. Ladrera recommended the filing of thirty
(30) Informations against petitioner, Makil U. Pundaodaya, Jose T. Navera, Rogelio de los
Reyes, Daud M. Adiong, Napoleon O. Cedeno, Laga S. Mangelen and Mama S. Macoming.
The said recommendation was approved by public respondents Deputy Ombudsman for
Mindanao Margarito P. Gervacio on February 27, 1999, and by the Honorable Ombudsman
on April 30, 1999.

The thirty Informations docketed as Criminal Cases Nos. 25247 to 25276 were filed with the
Sandiganbayan and raffled to the respondent court on May 5, 1999.

On July 27, 1999 petitioner filed with the respondent court a motion for the reduction of the
bail. The motion was approved by the respondent court in an Order dated August 4, 1999."2

In his Memorandum, petitioner presents before this Court the sole issue of: "Whether or not there
was undue and unjustifiable delay on the part of the Ombudsman in resolving the complaint filed
against the petitioner which violated his constitutional right to a speedy disposition of the Complaint
against him; and whether or not such undue and unjustifiable delay in resolving the Complaint
against the petitioner would warrant its dismissal."3 Petitioner’s main argument is that the "complaint
against petitioner, Case No. OMB 3-93-2793, was filed with the Office of the Ombudsman-Mindanao
on December 10, 1993 and was resolved only on April 30, 1998,4 resulting in a delay of 4 years, 4
months and 10 days." In addition, petitioner argues that he was deprived of due process because he
did not engage a certain Atty. Edgardo Camello who filed an "Appearance with Motion for Extension
of Time to Submit Counter-Affidavits" on behalf of the respondents in Case No. OMB-3-93-2791; that
he was not advised by the Graft Investigation Officer of his right to attorney; and that he filed his
counter-affidavit without the assistance of counsel. On the other hand, respondent Office of the
Ombudsman argues that petitioners cannot, by this special civil action for mandamus, compel the
ombudsman to dismiss the criminal charges filed against them, since such dismissal involves a
discretionary, not a ministerial, duty.

First, we shall discuss the propriety of mandamus as a remedy, an issue which is not novel. This
Court has held that, "while as a general rule, the performance of an official act or duty, which
necessarily involves the exercise of discretion or judgment, cannot be compelled by mandamus, this
rule does not apply in cases where there is gross abuse of discretion, manifest injustice, or palpable
excess of authority."5 Thus, in Angchangco, Jr. vs. Ombudsman6 and Roque vs. Office of the
Ombudsman7 the writ was issued in said instances.

Second, we shall determine if the exceptions cited apply to this case. The Office of the Ombudsman
narrates that the verified audit report of the COA special audit team was received on December 22,
1993, and finding the same sufficient in form and substance was docketed as OMB Case No. 34-93-
2791. On the basis thereof, a preliminary investigation was conducted. On March 1, 1994, the
respondents were ordered to file their counter-affidavits. On May 10, 1994, the Office of the
Ombudsman received the counter-affidavits of respondents. On February 29, 1995, the Office of the
Ombudsman received the reply-affidavit of COA. In a Resolution dated July 17, 1998, graft
investigation officer Rachelle L. Ladrera recommended the filing of thirty (30) informations against
petitioner, Makil U. Pundaodaya, Jose T. Navera, Rogelio de los Reyes, Daud M. Adiong, Napoleon
O. Cedeno, Laga S. Mangelen and Mama S. Macoming. The said recommendation was approved
by Deputy Ombudsman for Mindanao Margarito P. Gervacio on February 27, 1999, and by
Ombudsman Aniano Desierto on April 30, 1999. The informations were filed with the Sandiganbayan
on May 5, 1999. In its memorandum, the Office of the Ombudsman justified the delay in the conduct
of the preliminary investigation and subsequently, in the filing of the informations by stating that:

"Records of Case No. OMB 3-93-2791 will show that petitioner, thru his counsel, filed on
April 19, 1994 with the Office of the Ombudsman, Mindanao for an extension of time to file
his Counter-Affidavit. Petitioner submitted his Counter-Affidavit only on May 11, 1994.

However, in a letter dated August 2, 1994 the Office of the Ombudsman, Mindanao was
informed by complainant COA that it was not furnished with a copy of the Counter-Affidavits
of the respondents in Case No. OMB-3-93-2791 in complete disregard of the Order of GIO
Tolentino.

Hence, the Office of the Ombudsman, Mindanao furnished the COA with a copy of the
Counter-Affidavits and ordered the same office to submit its reply thereto within ten (10)
days. It filed its Reply-Affidavit on February 28, 1995.

It will be noted that the Office of the Ombudsman, Mindanao directed the COA to furnish the
respondents in Case No. OMB 3-93-2791 with a copy of their Reply-Affidavit to afford the
latter an opportunity to controvert the allegations contained therein. Petitioner however, and
his other co-respondents did not file any pleading with, or notified the Office of the
Ombudsman, Mindanao that they were waiving their right to refute the contents of the Reply-
Affidavit. Thus, it is clear that petitioner’s averment that this case has been pending for more
than six (6) years has no basis.

It should also be considered that there were several transactions involved in Case No. OMB
3-93-2791. This fact is proven by the thirty (30) Informations filed before the respondent
 court. Added to this is the fact that from the time the July 17, 1998 Resolution was approved
by public respondent Deputy Ombudsman Gervacio in his office in Mindanao the records of
the case still has to be sent to Manila for the review of the Ombudsman. The basic rule
therefore that in applying the constitutional guarantee of the right to speedy disposition of
cases particular regard must also be take on the facts and circumstances peculiar to each
case, finds meaning herein."8

We find for petitioner.

Article III of the Constitution provides that:

Sec. 16. All persons shall have the right to a speedy disposition of their cases before all
judicial, quasi-judicial, or administrative bodies.

The constitutional right to a "speedy disposition of cases" is not limited to the accused in criminal
proceedings but extends to all parties in all cases, including civil and administrative cases, and in all
proceedings, including judicial and quasi-judicial hearings."9 Hence, under the Constitution, any party
to a case may demand expeditious action on all officials who are tasked with the administration of
justice.10

However, the right to a speedy disposition of a case, like the right to speedy trial, is deemed violated
only when the proceedings is attended by vexatious, capricious, and oppressive delays; or when
unjustified postponements of the trial are asked for and secured, or even without cause or justifiable
motive a long period of time is allowed to elapse without the party having his case tried. Equally
applicable is the balancing test used to determine whether a defendant has been denied his right to
a speedy trial, or a speedy disposition of a case for that matter, in which the conduct of both the
prosecution and the defendant is weighed, and such factors as the length of the delay, the reasons
for such delay, the assertion or failure to assert such right by the accused, and the prejudice caused
by the delay. The concept of speedy disposition is a relative term and must necessarily be a flexible
concept.11

In this case, the preliminary investigation was resolved close to four (4) years from the time all the
counter and reply affidavits were submitted to the Office of the Ombudsman. After the last reply-
affidavit was filed on February 28, 1995, it was only on July 17, 1998 that a resolution was issued
recommending the filing of the corresponding criminal informations against the petitioner and the
others. It took eight months or on February 27, 1999 for Deputy Ombudsman Margarito P. Gervacio,
Jr. to approve the same and close to another year or on April 30, 1999 for Ombudsman Aniano
Desierto to approve the recommendation. During this interval, no incidents presented themselves for
resolution and the delay could only be attributed to the inaction on the part of the investigating
officials. Indeed, we find that without cause or justifiable motive, a long period of time was allowed to
elapse at the preliminary investigation stage before the informations were filed.

True, the prosecution is not bound by the findings of the COA and it must rely on its own
independent judgment in the determination of probable cause.12 However, we find that the cases are
not sufficiently complex to justify the length of time for their resolution. Neither can the long delay in
resolving the case under preliminary investigation be justified on the basis of the number of
informations filed before the Sandiganbayan nor of the transactions involved. The thirty informations
consist of sixteen (16) counts of violations of Section 3 (g) of RA 3019 relative to the overpricing and
lack of public bidding of laboratory apparatus and school equipment; while the fourteen (14) counts
are for violations of Section 3 (e) of the same law relative to the certification in the inspection reports
that the subject items have already been delivered and received, when in fact they have not yet
been actually delivered and received, in order to facilitate payment to the suppliers. There is no
statement that voluminous documentary and testimonial evidence were involved. On the contrary,
the Office Ombudsman itself claimed in its memorandum filed before this Court that "the Complaint
and the Counter-Affidavits submitted by the complainant and the accused respectively, as well as
the documents on hand" were sufficient to establish the existence of probable cause for violation of
Section 3 (e) and (g) of RA 3019. Hence, a clarificatory hearing was no longer conducted. Indeed, it
appears that the COA special audit team had already come up and provided the Office of the
Ombudsman with the facts and figures on the alleged overpricing, lack of public bidding and irregular
inspection reports, so much so that a delay of almost four years in terminating the preliminary
investigation is not justified.

Verily, the delay in this case disregarded the Ombudsman’s duty, as mandated by the Constitution
and Republic Act No. 6770, to enforce the criminal liability of government officers or employees in
every case where the evidence warrants in order to promote efficient service to the people. 13 The
failure of said office to resolve the complaints that have been pending for almost four years is clearly
violative of this mandate and the rights of petitioner as a public official. In such event, petitioner is
entitled to the dismissal of the cases filed against him.

In Tatad vs. Sandiganbayan,14 this Court dismissed the informations pending before the
Sandiganbayan, after finding the delay of three years in the termination of the preliminary
investigation by the Tanodbayan to be violative of the constitutional right of the accused to a speedy
disposition of cases. It was held therein:

"x x x. A delay of close to three (3) years can not be deemed reasonable or justifiable in the
light of the circumstances obtaining in the case at bar. We are not impressed by the attempt
of the Sandiganbayan to sanitize the long delay by indulging in the speculative assumption
that "the delay may be due to a painstaking and gruelling scrutiny by the Tanodbayan as to
whether the evidence presented during the preliminary investigation merited prosecution of a
former high ranking government official." In the first place, such a statement suggests a
double standard of treatment, which must be emphatically rejected. Secondly, three out of
the five charges against the petitioner were for his alleged failure to file his sworn statement
of assets and liabilities required by Republic Act No. 3019, which certainly did not involve
complicated legal and factual issues necessitating such "painstaking and gruelling scrutiny"
as would justify a delay of almost three years in terminating the preliminary investigation. The
other two charges relating to the alleged bribery and alleged giving of unwarranted benefits
to a relative, while presenting more substantial legal and factual issues, certainly do not
warrant or justify the period of three years, which it took the Tanodbayan to resolve the
case."

Similarly, we hold that the circumstances obtaining in the instant case do not warrant or justify the
length of time, that is four years, it took the Ombudsman to resolve the preliminary investigation.
What glares from the pleadings of both the petitioner and the public respondent Ombudsman is that
from the submission of the last reply-affidavit, there was an unexplained interval or inactivity of close
to four years, prior to the issuance of the resolution finding probable cause and directing the filing of
the corresponding informations.

Lastly, petitioner prays for the dismissal of Ombudsman Case No. OMB-3-93-2791, and this Court,
applying the ruling in the Roque case,15 citing Tatad,16 likewise resolves to directly dismiss the
informations already filed before the Sandiganbayan against petitioner "in the interest of the speedy
disposition of cases" and considering that "the long and unexplained delay in the resolution of the
criminal complaints against petitioner was not corrected by the eventual filing of the informations."
WHEREFORE, the Petition for Mandamus is GRANTED and Ombudsman Case No. OMB-3-93-
2791 is accordingly DISMISSED. The Office of the Ombudsman is further directed to issue the
corresponding clearance in favor of petitioner.

SO ORDERED.

G.R. No. 173562 January 22, 2008

CENTRAL CEMENT CORPORATION (now Union Cement Corporation), petitioner,

vs.
MINES ADJUDICATION BOARD and ROCK AND ORE INDUSTRIES, INC., respondents.

DECISION

REYES, R.T., J.:

PROMPT disposition of cases is a prime duty not only of the courts but also of quasi-judicial bodies.
But what should be done if a party requests deferment of disposition until the parties submit a joint
motion to dismiss? What is the measure of a valid compromise agreement fit for execution?

We take up the twin questions in this petition to review on certiorari under Rule 45 the Decision1 of
the Court of Appeals (CA) affirming that of the Mines Adjudication Board (MAB), 2 which dismissed
the appeal of petitioner Central Cement Corporation (CCC).

The Facts

Petitioner CCC and private respondent Rock and Ore Industries, Inc. (ROII) are domestic mining
companies incorporated under Philippine law.3

In 1992, petitioner CCC filed Mineral Production Sharing Agreement (MPSA), MPSA-P-III-24 and
MPSA-P-III-31, with the Department of Environment and Natural Resources (DENR) covering some
4,000 hectares at Barangay Akle, Narra and Alagao in San Ildefonso, Bulacan. Private respondent
ROII filed its own MPSA-P-111-117 application over areas in Akle in 1995. 4

The application of private respondent ROII was duly published and posted. Petitioner opposed and
filed an adverse claim to the application of private respondent with the Panel of Arbitrators of the
DENR claiming that private respondent's MPSA-P-III-117 was in conflict with its MPSA-P-III-24. A
third company, Neutron Construction (NC), filed an intervention complaining that its own MPSA-P-III-
26 also overlapped private respondent's MPSA application.5

On February 24, 2000, the Panel of Arbitrators rendered a decision dismissing the opposition of
petitioner and the intervention of NC. The Panel of Arbitrators ruled, among others, that the adverse
claim of petitioner was filed beyond the 30-day reglementary period as provided under DENR
Administrative Order No. 96-40. It also upheld the MPSA application of private respondent. 6

Petitioner appealed to the MAB. On January 4, 2001, the MAB affirmed 7 the decision of the Panel of
Arbitrators. The MAB agreed with the ruling of the Panel of Arbitrators that the adverse claim of
petitioner was filed beyond the reglementary period and that petitioner was estopped from
challenging the application of private respondent.8

Petitioner moved for reconsideration9 of the MAB's decision.

During the pendency of the motion for reconsideration, the President of private respondent, Manny
Teng,10 brought to the attention of MAB that two companies, Union Cement Corporation (UCC) and
Eagle Cement Corporation (ECC), had executed a Memorandum of Understanding (MOU) 11 which
amicably settled the differences between the parties. The MOU was signed by Francisco Viray, for
UCC, and Ramon Ang, for ECC. The MOU essentially provided for reciprocal cession of claims and
ownership of lands in the mining dispute before the MAB by swapping of mining claims and rights.
Teng prayed for the resolution of the MAB appeal on the ground that both parties had already
resolved the issue by virtue of the executed MOU.12

On June 10, 2002, the MAB13 directed private respondent to comment on why it should act on the
request of Teng for the resolution of the appeal, considering that the MOU was entered into between
corporations not parties to the case.

Private respondent responded14 to the MAB order stating that the claims which were the subject
matter of the MOU between UCC and ECC were the very same claims covered by the case between
it and petitioner and that private respondent had authorized ECC to execute the MOU on its behalf.

In a Manifestation and Comment15 dated July 13, 2002, petitioner acknowledged that it had merged
with UCC and that it was bound by the MOU. The pertinent portions of the manifestation and
comment state:

Appellant does not deny the existence, genuineness, and due execution of the Memorandum
of Understanding (MOU) between UNION CEMENT (UCC) AND EAGLE CEMENT
CORPORATION (ECC); that it is a corporation which was subsequently merged into UNION
CEMENT CORPORATION, the surviving corporation and that it is bound by the MOU; that it
recognizes that Rock and Ore Industries, Inc., and ECC have identical controlling interests;
and that both parties have agreed to settle this case, upon the swapping contemplated under
the MOU.16

Petitioner, however, resisted the resolution of the appeal on the ground of prematurity. While
admitting that it was bound by the MOU, it claims that the swapping of the claims that was at the
heart of the MOU had yet to be consummated by the submission by private respondent of data that
petitioner would compare with its own. Petitioner also reported that the parties agreed to prepare
and submit a joint motion to dismiss to terminate the litigation. It prayed that the MAB hold in
abeyance the dismissal of the appeal on the basis of the MOU until a joint motion of the parties is
submitted.17

On August 2, 2002, the MAB18 treated the comment filed by petitioner as an opposition and required
the parties to iron out their differences and submit a joint motion for its consideration.

On August 12, 2002, Teng wrote a letter19 to the MAB seeking an early resolution of the MAB case
on the basis of the comment and manifestation submitted by the parties.

On August 29, 2002, the MAB handed down a dismissal resolution denominated as a decision, 20 with
the following fallo:

WHEREFORE, the foregoing premises considered, the herein Motion for Reconsideration
filed by the Appellant is hereby DISMISSED.

SO ORDERED.21
A reading of the MAB decision reveals that what was under consideration was the letter of Teng
praying for the resolution of the case on the ground that the parties had already resolved the issue
by virtue of the execution of the MOU. What was disposed by the MAB, however, was the motion for
reconsideration filed by petitioner. At any rate, the MAB stated that after the parties failed to respond
to its order for them to iron out their differences and file a joint motion, it had no other recourse but to
resolve private respondent's plea to deny the motion for reconsideration. The MAB stated:

Notwithstanding the two (2) Orders of the Chief of the MAB Secretariat, records show that
the parties failed to answer the said Order, giving the MAB no other recourse but to resolve
the Motion by Rock and Ore to dismiss the pending Motion for Reconsideration of Central
Cement Corporation.

A thorough examination of the MOU shows that the same is duly executed between the
parties. Such genuineness and due execution was expressly recognized and admitted by the
Counsel of Central Cement in his Manifestation/Comment dated July 13, 2002. The
relationship of the parties to the MOU and the parties of the case is also established. Union
Cement Corporation is the surviving corporation of Central Cement while Eagle Cement
Corporation is duly authorized by Rock and Ore to execute the MOU. In substance, the MOU
hammered out certain points of convergence that have rendered moot and academic the
issues in the instant case. Although the Appellant thru Counsel prays for holding in abeyance
the resolution of the case in view of some internal matters that has to be ironed out by the
parties, the Board is of the position that such matters can not, in any way, affect the
agreements reached under the MOU.22

Petitioner filed a second motion for reconsideration23 which was denied.24 It then appealed to the
CA.25

CA Disposition

On March 2, 2006, the CA rendered a decision affirming that of the MAB, disposing as follows:

IN VIEW OF THE FOREGOING, the MAB issuances of August 29, 2002 and December 10,
2002 are AFFIRMED, with the directive that the parties observe the terms of the MOU dated
September 26, 2001 as their compromise agreement.

SO ORDERED.26

The CA duly noted the oversight in the MAB's disposition, thus:

On August 29, 2002, only 27 days after its order to the parties, the MAB handed down the
controversial resolution, which it calls a Decision, with this cryptic disposition: Wherefore, the
foregoing premises considered, the motion for reconsideration filed by the appellant is
dismissed.

This resolution opens with the statement that for consideration was the letter dated May 14,
2002 of the respondent's Teng praying for the resolution of the case on the ground that the
parties have already resolved the issue by virtue of the execution of the MOU, and ends by
denying the petitioner's motion for reconsideration. Motion for reconsideration of what? The
resolution seems to labor under the impression that the respondent's letter was asking for
the denial of the motion for reconsideration of the petitioner with respect to the MAB's
original decision of January 4, 2001 affirming the Panel of Arbitrators – an interpretation that
 is not borne out by its language. As the words make clear, the respondent was only seeking
a resolution of the case on the ground that the parties have already resolved the issue
between them by virtue of the MOU. This is not the same as saying that it wanted the denial
of the motion for reconsideration of the decision of January 4, 2001. But in the context in
which it looked at the May 14, 2002 letter, the MAB held that after the parties failed to
respond to its order to them to iron out their differences and file a motion, it had no other
recourse than to resolve the respondent's plea to deny the motion for reconsideration. 27

In deciding for the validity of the MOU as a compromise agreement between petitioners and private
respondent, the CA ratiocinated:

As we said, we have perceived that the MAB's original decision on the merits of January 4,
2001 is no longer in question here. While it is true that the petitioner filed a motion for
reconsideration of this decision, the parties had since then come to an amicable settlement
in the form of the MOU. The dispute had funneled into the narrow question of whether the
resolution of the case on the basis of the MOU should be held in abeyance until the parties
ironed out their differences under the agreement. The objective of the petition for certiorari is,
at root, the maintenance of the Order of August 2, 2002, in effect, allowing the parties time to
dispose of the case through a joint motion.

The reasons underlying a plea for the deferment of the resolution of the case are not
convincing. The petitioner claims that the MAB had acted capriciously when it resolved the
case unilaterally against its earlier order to give the parties the right to file the joint motion.
But as incisively observed by the Solicitor General, the fact that the MAB came out with a
resolution of the motion for reconsideration only 27 days after directing the parties to resolve
their differences and file a motion does not reflect an arbitrary and whimsical change of
judgment. The records bear out that the MAB endeavored to have the parties resolve their
differences by themselves and only when they failed to submit the motion for resolution of
the case did the MAB issue its decision. The lapse of a period of 27 days before it acted was
well within the range of a reasonable discretion considering that this was an administrative
case that had to be resolved with dispatch. The motion that was resolved was ripe for
resolution before the parties even began to set the mechanics of settlement in motion. The
MAB surely had the right and duty to resolve the case at once given the failure of the parties
to act promptly on its directive.

The Solicitor General has concluded that the MAB ruled for the denial of the motion for
reconsideration on the ground that the parties had arrived at a resolution of their controversy
through the MOU. Everybody seems to agree. The respondent said that the motion for
reconsideration was denied by MAB on August 29, 2002 because the MOU rendered the
dispute moot and academic. This has been the constant refrain throughout the discussion.
The MAB's intent to consider the case mooted by the MOU may be drawn from its final
statement in the August 29, 2002 resolution that whatever internal matters must be ironed
out by the parties, they do not affect the agreements reached under the MOU.

It is hard to ignore the logical and legal implications of this ruling. It can only mean that the
original MAB decision of January 4, 2001 has become functus officio, the rights and
obligations of the parties thereunder being substituted by the rights and obligations of the
parties under the MOU. The MOU, in a word, was a compromise agreement. This is the view
of the respondent, and we agree. A compromise agreement is a contract where the parties
undertake reciprocal obligations to avoid a litigation or put an end to one already
commenced. San Antonio v. Court of Appeals, 371 SCRA 536. If the MOU is to be properly
understood, the two parties to the case had freely entered into it for the purpose of
 undertaking reciprocal obligations to put an end to a controversy between them. Once the
compromise was perfected, the parties were bound to abide by it in good faith. Ramnani v.
Court of Appeals, 360 SCRA 645.

Under Article 2037 of the Civil Code, a compromise has upon the parties the effect and
authority of res judicata, but there will be no execution except in compliance with a judicial
compromise. Although the MAB did not categorically declare the MOU as approved, it
achieved this result when it denied the motion for reconsideration and held that the MOU
was not affected by the fact that there were still matters to be threshed out within its
framework. We only regret that the MAB could not be as articulate as the situation would
demand to make clear a very important right. It is for us in the interest of justice to bridge the
divide.

In coming this far, we have actually passed upon the issues raised in the second motion for
reconsideration.28

As already intimated, petitioner's motion for reconsideration was denied with finality on July 13,
2006.29 Hence, the present recourse.

Issues

Petitioner ascribes the following errors to the CA:

I.

The Honorable Court of Appeals, it is respectfully submitted, committed reversible error

when it ruled that the Mines Adjudication Board did not commit grave abuse of
discretion amounting to lack or excess of jurisdiction in dismissing the first Motion for
Reconsideration of its decision on the merits dated January 4, 2001 which, in effect,
reinstated the decision of the Panel of Arbitrators adjudicating MPSA-P-III-117 to respondent
Rock and Ore Industries, Inc., under the guise of implementing a judgment on a compromise
agreement in the form of a Memorandum of Understanding, thereby denying herein
petitioner of property without due process of law in contravention of its constitutional rights.

II.

Assuming without conceding the validity of the Memorandum of Understanding which

stipulates for the swapping and adjudication of mining rights as upheld by the Mines
Adjudication Board, the Honorable Court of Appeals erred in not finding grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of the Mines Adjudication
Board when it reached a unilateral, one-sided and biased adjudication in favor of respondent
Rock and Ore Industries, Inc., in violation of the letter and spirit of the Memorandum of
Understanding as a contract between the parties and thereby impaired the petitioner's
constitutional guarantee of the obligations of contracts.

III.

In any event, the Honorable Court of Appeals committed reversible error when it ruled that,
in effect, there was an implementation of a judgment on compromise in the form of a
Memorandum of Understanding when the said agreement was conditioned upon the
performance of contractual obligations by the respective parties. Besides, by its very
 provisions, the Memorandum of Understanding has already expired without any of its
conditions having been fulfilled.30 (Underscoring supplied)

On October 2, 2006, private respondent filed a Comment31 on the petition. The Solicitor General also
filed a comment32 on behalf of the MAB essentially batting for the affirmance of the CA decision.

Our Ruling

The petition is devoid of merit.

Essentially, based on its discussion, petitioner raises two issues for Our consideration. The first is
the procedural question of whether or not the CA erred in affirming the MAB dismissal of the appeal,
without any joint motion to dismiss filed by petitioner CCC and private respondent ROII.
The second is the substantive issue of whether or not the CA erred in upholding the MOU between
petitioner and private respondent as a valid compromise agreement, which had the effect of finally
terminating the case between them.

I. Resolution of a motion can be deferred

but not indefinitely; speedy or efficient
disposition of cases is a constitutional
duty of all courts and administrative bodies.

In its bid to invalidate the MAB dismissal of its appeal, petitioner harps on the absence of the parties'
joint motion to dismiss. It argues that the absence of the joint motion shows that there was no valid
compromise agreement between the parties.33 Petitioner insists that the MAB should have deferred
the dismissal of the appeal until after a joint motion to dismiss is filed by it and private respondent.

We are not persuaded. It was well within the power of the MAB to dispose of the appeal even
without a joint motion to dismiss filed by petitioner and private respondent. Records disclose that an
MOU had been executed between petitioner and private respondent. This was brought to the
attention of the MAB. The MOU is a compromise agreement that finally settled the dispute between
them. Petitioner does not contest the validity and due execution of the MOU. It even admitted that it
was bound by the terms of the MOU. On the basis of the MOU and the admission of the parties, the
MAB may dismiss the appeal outright because the issues raised in the appeal have become moot
and academic.

That the MAB deferred to the request of petitioner to await a joint motion to dismiss before it
resolves the appeal should not be interpreted as a condition precedent to its power to order the
dismissal of the appeal. This applies even more because petitioner and private respondent failed to
comply with the MAB order to submit a joint motion to dismiss. The MAB certainly cannot wait
indefinitely for the joint motion in order to resolve the appeal. That would put the wheels of justice on
hold and leave the resolution of cases to the whims and caprices of the parties. We cannot let that
happen. The MAB correctly resolved the case on the basis of the MOU after the parties failed to file
a joint motion to dismiss.

The speedy resolution of cases is a constitutional duty.34 In a litany of cases, We have consistently
held that courts and administrative bodies must resolve cases speedily and efficiently. The speedy
disposition of cases is paramount in the administration of justice. It is a truism that justice delayed is
justice denied.

In Lopez v. Office of the Ombudsman,35 this Court stated:

 The constitutional right to a "speedy disposition of cases" is not limited to the accused in
criminal proceedings but extends to all parties in all cases, including civil and administrative
cases, and in all proceedings, including judicial and quasi-judicial hearings. Hence, under the
Constitution, any party to a case may demand expeditious action on all officials who are
tasked with the administration of justice.

The need to observe the said constitutional duty was reiterated in Republic v.
Sandiganbayan,36 thus:

The law looks with disfavor on long, protracted and expensive litigation and encourages the
speedy and prompt disposition of cases. That is why the law and the rules provide for a
number of devices to ensure the speedy disposition of cases.

We apply the same principle here. The MAB, as a quasi-judicial body, is constitutionally required to
resolve the appeal efficiently and with dispatch. We find that there is more reason that the MAB
speedily resolve the appeal because the parties have already amicably settled their dispute. There is
no justification why the MAB should still await a joint motion to comply with its constitutional duty. We
note that the parties were given ample opportunity to submit a joint motion but they ignored the MAB
order. The MAB had no other recourse but to resolve the appeal based on records and the
admission of the parties.

We agree with the position of the Solicitor General that the MAB did not gravely abuse its discretion
in resolving petitioner's motion for reconsideration. The Solicitor General contended:

The MAB's August 2, 2002 Order in which it stated that it gave substance and credence to
petitioner's opposition must not be construed as a source of substantive right for petitioner.

The MAB merely acknowledged petitioner's opposition. But to say that the MAB is thereafter
constrained to decide it only in petitioner's favor is to improperly stretch one's imagination to
false insinuations.

The MAB's resolution was only rendered after a thorough evaluation of the pertinent
pleadings before them. It reasonably ruled for the dismissal of the motion for reconsideration
on the ground that the parties have substantially arrived at a resolution to the pending
controversy.

The fact that petitioner is apprehensive of a possibility that its agreement with private
respondent will uneventfully not materialize does validate its accusation against the MAB that
it committed grave abuse of discretion in rendering the questioned decision. Furthermore,
the MAB must not be faulted if petitioner was taken by surprise by its rendered decision.
Having submitted itself to the jurisdiction of the MAB, petitioner must respectfully abide by its
ruling which was arrived at after a deliberate consideration of the issue.

Certiorari under Rule 65 of the Revised Rules of Court is not the proper remedy to contest a
judgment, which is unfavorable to ones cause of action, absent any showing of grave abuse
of discretion.37

Worth quoting with Our approval is the observation of the CA along this line:

The reasons underlying a plea for the deferment of the resolution of the case are not
convincing. The petitioner claims that the MAB had acted capriciously when it resolved the
 case unilaterally against its earlier order to give the parties the right to file the joint motion.
But as incisively observed by the Solicitor General, the fact that the MAB came out with a
resolution of the motion for reconsideration only 27 days after directing the parties to resolve
their differences and file a motion does not reflect an arbitrary and whimsical change of
judgment. The records bear out that the MAB endeavored to have the parties resolve their
differences by themselves and only when they failed to submit the motion for resolution of
the case did the MAB issue its decision. The lapse of a period of 27 days before it acted was
well within the range of a reasonable discretion considering that this was an administrative
case that had to be resolved with dispatch. The motion that was resolved was ripe for
resolution before the parties even began to set the mechanics of settlement in motion. The
MAB surely had the right and duty to resolve the case at once given the failure of the parties
to act promptly on its directive.38

II. A memorandum of understanding

with the requisites of a contract
is a valid compromise agreement;
it can be executed upon its perfection,
not consummation.

Petitioner claims that there are outstanding matters, such as deeds of assignment 39 and other
pertinent data,40 which need to be prepared and submitted by the parties before the MOU can be
regarded as a binding agreement between them. Petitioner argues that these matters render the
MOU conditional. Since these conditions were not fulfilled, petitioner contends that the MOU was not
perfected.41

Article 2028 of the Civil Code spells out the nature of a compromise as a contract whereby the
parties, by making reciprocal concessions, avoid litigation or put an end to one already
commenced.42 Parties to a compromise are motivated by the hope of gaining, balanced by the
dangers of losing.43 It contemplates mutual concessions and mutual gains to avoid the expenses of
litigation, or, when litigation has already begun, to end it because of the uncertainty of the result. 44

As a contract, a compromise agreement must comply with the following basic elements: (1) consent
of the contracting parties; (2) object certain which is the subject matter of the contract; and (3) cause
of the obligation which is established.45

All these elements are present in this case.

First, petitioner and private respondent freely and voluntarily entered into the MOU. Petitioner
admits that it authorized Francisco Viray to sign the MOU,46 while private respondent was duly
represented by Ramon Ang.47 The authority of the agents is evidenced by duly executed board
resolutions of the respective companies.

Second, there is identity of the parties and subject matter. Petitioner admits that it has merged with
CCC, which entered into the MOU. In its Manifestation48 dated July 13, 2002, petitioner
acknowledged:

Appellant does not deny the existence, genuineness, and due execution of the Memorandum
of Understanding (MOU) between UNION CEMENT (UCC) and EAGLE CEMENT
CORPORATION (ECC); that it is a corporation which was subsequently merged into UNION
CEMENT CORPORATION, the surviving corporation and that it is bound by the MOU; that it
recognizes that Rock and Ore Industries, Inc., and ECC have identical controlling interests;
 and that both parties have agreed to settle this case, upon the swapping contemplated under
the MOU.49

The mining claims, MPSA-P-III-117 and MPSA-P-III-24, which are the subject matter of the MOU are
the same claims covered by the MAB case between the parties. The pertinent portions of the MOU
provide:

This Memorandum of Understanding made and entered into this 26th day of September,
2001, by and between:

UNION CEMENT CORPORATION, a corporation duly organized and existing under

and by virtue of the laws of the Philippines with principal office address at 166
Salcedo Street, Legaspi Village, Makati City, represented herein by its Senior
Executive Vice-President, Dr. Francisco L. Viray, hereinafter referred to as "UCC";

EAGLE CEMENT CORPORATION, a corporation duly organized and existing under

and by virtue of the laws of the Philippines with principal office address at Ground
Floor, Alegria Building, 2229 Pasong Tamo St., Makati City, represented herein by
Ramon S. Ang, hereinafter referred to as "ECC."

WHEREAS, UCC has in its favor Mineral Production Sharing Agreement (MPSA) No. P-III-
31 covering certain parcels of land located in San Ildefonso, Bulacan;

WHEREAS, UCC has in its favor MPSA No. 161-2000-III (previously numbered P-III-24),
covering certain parcels of land also located in San Ildefonso, Bulacan;

WHEREAS, UCC and ECC have overlapping mining claims and/or surface ownership rights
over certain parcels of land located in San Ildefonso, particularly on the following:

A: Land Ownership – Lot Nos. 3153 and 3977

B: Mining Claims – MPSA 161-2000-III; MPSA-P-III-31; MPSA-P-III-116 50

Third, the parties intended the MOU as a compromise agreement to amicably settle the mining
dispute with the MAB. This is clear from the MOU itself, which provides:

WHEREAS, the parties hereto wish to amicably settle their overlapping claims in a fair and
equitable manner;

WHEREAS, the parties hereto also wish to consolidate their ownership of certain contiguous
parcels of land, necessitating the transfer of certain lots or portions of lots owned by a party
to the other party and vice-versa;

WHEREAS, they further wish to maintain the present access road branching from the
provincial road and leading to UCC's cement plant by donating the same to the Municipality
of San Ildefonso as road lot/s.51

Fourth, both parties are bound by the terms of the MOU. Petitioner admitted this in its Manifestation
and Comment.52
In fine, all the basic elements of a contract are present. The MOU is a valid compromise agreement
between petitioner and private respondent.

Article 1315 of the Civil Code provides that a contract is perfected by mere consent, which is
manifested by the meeting of the offer and the acceptance upon the thing and the cause which are
to constitute the contract. Here, there is no dispute that the MOU was already "perfected" as
manifested by the parties' assent to it. They freely and voluntarily signed the MOU.

Petitioner confuses the concept of "perfection" of contract with the "consummation" of contract. A
contract undergoes three distinct stages: (1) preparation or negotiation; (2) perfection; and (3)
consummation. Negotiation begins from the time the prospective contracting parties manifest their
interest in the contract and ends at the moment of agreement of the parties. The perfection or birth
of the contract takes place when the parties agree upon the essential elements of the contract. The
last stage is the consummation of the contract wherein the parties fulfill or perform the terms agreed
upon in the contract, culminating in its extinguishment.53

The delivery of pertinent data and the execution of the Deeds of Assignment are not part of the
"perfection" stage. They are part of the "consummation" stage of the MOU. This is clear from the
MOU itself. A reading of the MOU shows that the manifest intention of the parties was the
consolidation of rights to certain mining areas to be vested in a single party. To this end, petitioner
and private respondent agreed to swap mining rights for certain parcels of land. This was the
essence of the compromise agreement. The pertinent portions of the MOU provide:

1. Assignment of UCC's Mining Rights/Claims – In order to settle the conflicting mining rights
and claims of the parties, UCC shall assign in favor of ECC such portions of its various
mining rights and/or claims within MPSA 161-2000-III and MPSA P-III-31 as indicated in
Annex B-1, and more particularly described as that area bounded by coordinates defines in
Annex B-2. UCC is amenable to allow ECC to quarry and extract shale raw materials from
the lots that may still be owned by ECC but situated within MPSA 161-2000-III and MPSA P-
III-31, under terms and conditions that will be defined later.

2. Assignment of ECC's Mining Rights/Claims – ECC shall reciprocally assign in favor of

UCC, all its various mining rights and claims, including those named under its nominees or
other entities or persons under its control, over lots or parcels of land whose areas are in
conflict with or located within MPSA 161-2000-III and MPSA P-III-31, after excluding
therefrom the areas of the mining rights and/or claims assigned and transferred pursuant to
Part III, paragraph 1 above, as indicated in Annex C-1, and more particularly described as
those areas bounded by coordinates defined in Annex C-2.

3. Consolidation of Rights in Each Area – It is understood that the parties intend that surface
rights and mining rights shall be both vested in a single party for each particular area.
Consequently, ECC shall sell to UCC the remaining parcels of land over which the former
holds ownership or other rights or interests, and which parcels are covered by the UCC's
MPSA 161-2000-III and P-III-31, excluding the shale areas mentioned in Part III, Item 1 and
those earlier assigned by UCC to ECC. Reciprocally, UCC shall sell to ECC such parcels of
land over which it has ownership or other rights or interests that are covered by ECC's
mining claims or agreements.54

Nor are the execution of the deeds of assignment and the delivery of pertinent data conditions
precedent to the validity of the MOU. This is inferable from Section 5, Part IV of the MOU which
provides:
 5. The parties agree to execute and deliver such further deeds, documents, and instruments
and to perform such further acts that are or may be necessary to fully implement and
effectuate the transactions contemplated in this MOU.55

The above clause requires the parties to execute deeds and perform acts that will be necessary to
effectuate the agreement. They are performed after the contract is perfected. Here, the execution of
the necessary Deeds of Assignment and the delivery of pertinent data are acts that go into the
consummation of the MOU. They are not conditions precedent to its validity.

To put it mildly, petitioner prefers certain matters to be completed before the MAB may dismiss the
appeal. It wants private respondent to first deliver some pertinent data which it will compare with its
own and then decide on whether to agree to the dismissal of its pending appeal. If We accept this
position, the MAB will have to wait indefinitely until after all the terms of the MOU have been
completed before it may dismiss the appeal. This is certainly absurd because the consummation of
the terms56 of the MOU will take a minimum of two years. By the reckoning of petitioner, the MAB
should archive the appeal for at least two years before it is resolved. This is certainly contrary to the
main objective of a compromise agreement which is the amicable resolution of the pending case
expeditiously.

Prescinding from Our ruling that the MOU was a valid compromise agreement between petitioner
and private respondent, the terms of the MOU must be enforced. The MOU substitutes for a
judgment on the merits and binds the parties. It is enforceable by a writ of execution. In Magbanua
v. Uy,57 the Court ruled:

When a compromise agreement is given judicial approval, it becomes more than a contract
binding upon the parties. Having been sanctioned by the court, it is entered as a
determination of a controversy and has the force and effect of a judgment. It is immediately
executory and not appealable, except for vices of consent or forgery. The nonfulfillment of its
terms and conditions justifies the issuance of a writ of execution; in such an instance,
execution becomes a ministerial duty of the court.

Accordingly, if the parties fail to comply with the terms of the MOU, the proper remedy is to apply for
a writ of execution. Petitioner may apply for a writ to compel private respondent to perform its part of
the bargain under the MOU. Private respondent, in turn, may compel petitioner to execute deeds
and documents in accordance with the terms of the MOU.

Again, We sustain the holding and observation of the CA on the legal implications of the execution of
the MOU, thus:

It is hard to ignore the logical and legal implications of this ruling. It can only mean that the
original MAB decision of January 4, 2001 has become functus officio, the rights and
obligations of the parties thereunder being substituted by the rights and obligations of the
parties under the MOU. The MOU, in a word, was a compromise agreement. This is the view
of the respondent, and we agree. A compromise agreement is a contract where the parties
undertake reciprocal obligations to avoid a litigation or put an end to one already
commenced. San Antonio v. Court of Appeals, 371 SCRA 536. If the MOU is to be properly
understood, the two parties to the case had freely entered into it for the purpose of
undertaking reciprocal obligations to put an end to a controversy between them. Once the
compromise was perfected, the parties were bound to abide by it in good faith. Ramnani v.
Court of Appeals, 360 SCRA 645.
 Under Article 2037 of the Civil Code, a compromise has upon the parties the effect and
authority of res judicata, but there will be no execution except in compliance with a judicial
compromise. Although the MAB did not categorically declare the MOU as approved, it
achieved this result when it denied the motion for reconsideration and held that the MOU
was not affected by the fact that there were still matters to be threshed out within its
framework. We only regret that the MAB could not be as articulate as the situation would
demand to make clear a very important right. It is for us in the interest of justice to bridge the
divide.

In coming this far, we have actually passed upon the issues raised in the second motion for
reconsideration.58

WHEREFORE, the petition is hereby DENIED. The Court of Appeals Decision is AFFIRMED in full.

SO ORDERED.