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  G.R. No. 146818 February 6, 2006JAN-DEC CONSTRUCTION CORORATION,  petitioner vs. COURT OF AEA!S a # FOOD TER$INA! , INC.  respondentsBefore the Court is a petition for certiorari of the Resolution 1  dated August 11, 2000 of theCourt of Appeals (CA) in CA-G.R. ! o. #00$%, &hich dis'issed petitioners petition for certiorari and the CA Resolution dated ece'*er 20, 2000, &hich denied petitioners 'otion for reconsideration.+he factual *acground of the case is as follo&sn ece'*er 1/, 1, an-ec Construction Corporation (petitioner) filed a co'plaint *efore the Regional +rial Court, Branch 2/#, untinlupa Cit3 (R+C) against etro-outh 4nter'odal +ransport +er'inal Corporation (4nter'odal) and 5ood +er'inal, 4nc. (respondent) for 6u' of one3 and 7nforce'ent of Contractor (sic) 8ien,6 doceted as Civil Case o. -92%. 2  +he petitioner alleges in the co'plaint that respondent leased to4nter'odal a portion of its propert3 located at !B Avenue, 5+4 Co'pound, +aguig Cit3 for the purpose of operating a *us ter'inal: 4nter'odal contracted &ith the petitioner for the construction of a *us ter'inal on the leased propert3 at an agreed contract price of !2/,0/,0.00 &ith 10; do&npa3'ent and the *alance pa3a*le in eleven e<ual 'onthl3 pa3'ents: the petitioner perfor'ed its o*ligation under the construction agree'ent &ith the corresponding change orders *ut, in gross violation of its o*ligation, 4nter'odal paid onl3 a fraction of the agreed consideration: despite de'ands, 4nter'odalfailed to pa3 the *alance of !29,/20,000.00: petitioner learned that respondent &ill taeover the *us ter'inal: respondent should assu'e the unpaid o*ligations of 4nter'odal in the event of such taeover in vie& of the petitioners preferential lien over the *us ter'inal under Article 22$2, paragraphs 9 and $ of the Civil Code. 9 4n its Ans&er &ith Counterclai' and Cross-Clai' dated anuar3 2#, 2000, 4nter'odal contends that the petitioner has no cause of action against it since the latter did not properl3 co'pl3 &ith its o*ligation to the for'er. 4nter'odal points to the respondent as the part3 solel3 lia*le to the petitioner since respondent failed to co'pl3 &ith its o*ligations under the lease contract *3 failing to deliver the %-hectare per'anent ter'inalsite and to provide road access to the ter'inal. $ n 5e*ruar3 1$, 2000, respondent filed a otion to is'iss. Respondent alleges that the co'plaint failed to state an3 cause of action against it *ecause it is not a part3 to the construction agree'ent *et&een petitioner and 4nter'odal and therefore cannot *e held lia*le therefor. % n arch 2$, 2000, the R+C issued the rder dis'issing the co'plaint against respondent. #  +he R+C held that there is no privit3 of contract *et&een petitioner and respondent: there is no sho&ing that respondent is lia*le for the contractual o*ligation of 4nter'odal: it &ould *e unfair to put respondent in defense for an o*ligation it never incurred. / n April 1, 2000, petitioner filed a otion for Reconsideration, arguing that, even if there is no contractual relationship *et&een petitioner and respondent, a <uasi-contract e=ists under Article 1912 of the Civil Code and respondent is dut3 *ound to respect the creditors lien under Article 22$2, paragraph 9 of the Civil Code. >  n une /, 2000, the R+C issued the rder den3ing petitioners 'otion for reconsideration.  n August 9, 2000, petitioner filed a petition for certiorari &ith the CA, clai'ing that the R+C gravel3 a*used its discretion in dis'issing the co'plaint against respondent. 10  n  August 11, 2000, the CA issued the Resolution dis'issing petitioners petition for certiorari for *eing an i'proper re'ed3 against the rders of the R+C. 11  4t held that under Rule $1 of the 1/ Rules of Civil !rocedure, appeal is the proper re'ed3 fro' a  ?udg'ent or final order of the R+C.n August 90, 2000, petitioner filed a otion for Reconsideration. 12  n ece'*er 20, 2000, the CA issued the Resolution den3ing petitioners 'otion for reconsideration. 19 n 5e*ruar3 12, 2001, petitioner filed the present petition for certiorari *ased on the follo&ing grounds4+@7 CR+ 5 A!!7A8 GRA78 AB7 4+ 4CR7+4 A +4 G + 8ACD 5 R44C+4 4 @84 G +@A+ A!!7A8  7R R87 $1 5 +@7 1/ R87 5 C448 !RC7R7, + C7R+4RAR4  7R R87 #% 4 +@7 A!!R!R4A+7 R77 4 AA484 G A R7R 5 44A8 AGA4 +  7 757 A + E@487 +@7 CA7 +488 !7  A + +@7 R7A4 4 G 757 A +.44+@7 CR+ 5 A!!7A8 GRA78 AB7 4+ 4CR7+4  A +4 G + 8ACD 5 R44C+4 4 + 44 G +@7 7RR 7 R7R 5 44A8 5 +@7 C!8A4 + B +@7 +R4A8 CR+. 1$   Anent the first ground, petitioner contends that the CA overlooed that there are t&o defendants in Civil Case o. -92% and the case &as not dis'issed in its entiret3 since the co'plaint &as dis'issed onl3 as against respondent. !etitioner points out that ection 1, Rule $1 of the 1/ Rules of Civil !rocedure specificall3 states that no appeal 'a3 *e taen fro' a ?udg'ent or final order for or against one or 'ore of several parties in separate clai's, counterclai's and third part3 co'plaints, &hile the 'ain case is pending, unless the court allo&s an appeal therefro': in such instance, the aggrieved part3 'a3 file an appropriate special civil action under Rule #%. !etitioner su*'its that the re'ed3 it availed of is correct, and it &as grave a*use of discretion for the CA to dis'iss the petition for certiorari. As to the second ground, petitioner 'aintains that respondent is lia*le for the o*ligations of 4nter'odal should it taeover the *us ter'inal, under Articles 1912 and 22$2, paragraphs 9 and $, of the Civil Code.n the other hand, respondent avers that the present petition for certiorari should *e dis'issed for *eing an i'proper re'ed3 fro' the final order of the CA. Respondent su*'its that appeal via a petition for revie& under Rule $% of the 1/ Rules of Civil !rocedure is the correct recourse. 4n the event that the petition is given due course, respondent contends that CA did not a*use its discretion, 'uch less err, in dis'issing petitioners petition for certiorari *ecause appeal is the proper re'ed3 fro' the R+Cs rder dis'issing the co'plaint against petitioner since the order of dis'issal is final and not interlocutor3. 5urther'ore, respondent insists that the co'plaint failed to state an3 cause of action against it *ecause respondent is not a part3 to the construction agree'ent *et&een petitioner and 4nter'odal and, as such, cannot *e held lia*le for the de*ts incurred *3 the latter.!refatoril3, the Court notes that petitioner filed a special civil action for certiorari under Rule #% of the 1/ Rules of Civil !rocedure. As a rule, the re'ed3 fro' a ?udg'ent or final order of the CA is appeal via petition for revie& under Rule $% of the Rules.nder Rule $%, decisions, final orders or resolutions of the CA in an3 case, i.e ., regardless of the nature of the action or proceedings involved, 'a3 *e appealed to the Court *3 filing a petition for revie&, &hich &ould *e *ut a continuation of the appellate process over the srcinal case. 1%  4t sees to correct errors of ?udg'ent co''itted *3 the court, tri*unal, or officer. 4n contrast, a special civil action for certiorari under Rule #% is an independent action *ased on the specific grounds therein provided and proper onl3 if there is no appeal or an3 plain, speed3 and ade<uate re'ed3 in the ordinar3 course of la&. 1#  4t is an e=traordinar3 process for the correction of errors of ?urisdiction and cannot *e availed of as a su*stitute for the lost re'ed3 of an ordinar3 appeal. 1/ 4n the present case, petitioner received the CA Resolution dated ece'*er 20, 2000 den3ing its 'otion for reconsideration on anuar3 2, 2001. 4nstead of filing a petition for revie& &ith this Court &ithin 1% da3s fro' receipt or until anuar3 1/, 2001, petitioner filed this special civil action on 5e*ruar3 12, 2001 or $1 da3s fro' receipt of the CA Resolution dated ece'*er 20, 2000. B3 then, petitioner had alread3 lost the re'ed3 of appeal. B3 availing of a &rong re'ed3, the instant petition should have 'erited outright dis'issal.Ehile there are instances &here the e=traordinar3 re'ed3 of certiorari   'a3 *e resorted to despite the availa*ilit3 of an appeal, the long line of decisions den3ing the special civil action for certiorari  , either *efore appeal &as availed of or in instances &here the appeal period had lapsed, far outnu'*ers the instances &here certiorari   &as given due course. +he fe& significant e=ceptions are (a) &hen pu*lic &elfare and the advance'ent of pu*lic polic3 dictate: (*) &hen the *roader interests of ?ustice so re<uire: (c) &hen the &rits issued are null: (d) &hen the <uestioned order a'ounts to an oppressive e=ercise of ?udicial authorit3. 1> 4n the present case, petitioner has not provided an3 cogent e=planation that &ould a*solve it of the conse<uences of its failure to a*ide *3 the Rules.  Apropos  on this point are the Courts o*servations in Duremdes v. Duremdes  1  Although it has *een said ti'e and again that litigation is not a ga'e of technicalities, that ever3 case 'ust *e prosecuted in accordance &ith the prescri*ed procedure so that issues 'a3 *e properl3 presented and ?ustl3 resolved, this does not 'ean that procedural rules 'a3 altogether *e disregarded. Rules of procedure 'ust *e faithfull3 follo&ed e=cept onl3 &hen, for persuasive reasons, the3 'a3 *e rela=ed to relieve a litigant of an in?ustice co''ensurate &ith his failure to co'pl3 &ith the prescri*ed procedure. Conco'itant to a li*eral application of the rules of procedure should *e an effort on the part of the part3 invoing li*eralit3 to ade<uatel3 e=plain his failure to a*ide *3 the rules. 20  (7'phasis supplied)7videntl3, the CA erred in dis'issing petitioners petition for certiorari fro' the rder of the R+C dis'issing the co'plaint against respondent. Ehile ection 1, Rule $1 of the 1/ Rules of Civil !rocedure states that an appeal 'a3 *e taen onl3 fro' a final order that co'pletel3 disposes of the case, it also provides several e=ceptions to the rule, to &it (a) an order den3ing a 'otion for ne& trial or reconsideration: (*) an order den3ing a petition for relief or an3 si'ilar 'otion seeing relief fro' ?udg'ent: (c) an interlocutor3 order: (d) an order disallo&ing or dis'issing an appeal: (e) an order den3ing a 'otion to set aside a ?udg'ent *3 consent, confession or co'pro'ise on the ground of fraud, 'istae or duress, or an3 other ground vitiating consent: (f) an order of e=ecution: (g) a  ?udg'ent or final order for or against one or 'ore of several parties or in separate  clai's, counterclai's, cross-clai's and third-part3 co'plaints, &hile the 'ain case is pending, unless the court allo&s an appeal therefro': and (h) an order dis'issing an action &ithout pre?udice. 4n the foregoing instances, the aggrieved part3 'a3 file an appropriate special civil action for certiorari under Rule #%.4n the present case, the rder of the R+C dis'issing the co'plaint against respondent isa final order *ecause it ter'inates the proceedings against respondent *ut it falls &ithin e=ception (g) of the Rule since the case involves t&o defendants, 4nter'odal and herein respondent and the co'plaint against 4nter'odal is still pending. +hus, the re'ed3 of a special civil action for certiorari availed of *3 petitioner *efore the CA &as proper and the CA erred in dis'issing the petition.@o&ever, the assailed Resolution of the CA dis'issing petitioners petition for certiorari a'ounts to nothing 'ore than an error of ?udg'ent, correcti*le *3 appeal. Ehen a court, tri*unal, or officer has ?urisdiction over the person and the su*?ect 'atter of the dispute, the decision on all other <uestions arising in the case is an e=ercise of that ?urisdiction. Conse<uentl3, all errors co''itted in the e=ercise of said ?urisdiction are 'erel3 errors of  ?udg'ent. nder prevailing procedural rules and ?urisprudence, errors of ?udg'ent are not proper su*?ects of a special civil action for certiorari  . 21  5or if ever3 error co''itted *3the trial court or <uasi-?udicial agenc3 &ere to *e the proper su*?ect of revie& *3 certiorari  , then trial &ould never end and the docets of appellate courts &ould *e clogged *e3ond 'easure. 5or this reason, &here the issue or <uestion involved affects the &isdo' or legal soundness of the decision, not the ?urisdiction of the court to render said decision, the sa'e is *e3ond the province of a special civil action for certiorari  . 22  ince petitioner filed the instant special civil action for certiorari, instead of appeal via a petition for revie&, the petition should *e dis'issed.Besides, the R+C &as correct in dis'issing the co'plaint against respondent for failure to state a cause of action against it.+he ele'entar3 test for failure to state a cause of action is &hether the co'plaint allegesfacts &hich if true &ould ?ustif3 the relief de'anded. tated other&ise, 'a3 the court render a valid ?udg'ent upon the facts alleged thereinF 29  +he in<uir3 is into the sufficienc3, not the veracit3 of the 'aterial allegations. 2$  4f the allegations in the co'plaintfurnish sufficient *asis on &hich it can *e 'aintained, it should not *e dis'issed regardless of the defense that 'a3 *e presented *3 the defendants. 2%  A reading of the co'plaint sho&s that petitioner anchors its clai' against respondent on  Article 22$2, paragraphs 9 and $ of the Civil Code. +his provision descri*es a contractors lien over an i''ova*le propert3 as follo&s 1avvphil.net   Art. 22$2. Eith reference to specific i''ova*le propert3 and real rights of the de*tor, thefollo&ing clai's, 'ortgages and liens shall *e preferred, and shall constitute an encu'*rance on the i''ova*le or real right= = =(9) Clai's of la*orers, 'asons, 'echanics and other &or'en, as &ell as of architects, engineers and contractors, engaged in the construction, reconstruction or repair of *uildings, canals or other &ors, upon said *uildings, canals or other &ors:($) Clai's of furnishers of 'aterials used in the construction, reconstruction, or repair of *uildings, canals or other &ors, upon said *uildings, canals or other &ors.H6 (7'phasissupplied)4n .8. Bernardo Construction vs. Court of Appeals, 2#  the Court e=plained the concept of a contractors lien under Article 22$2 of the Civil Code and the proper 'ode for its enforce'ent as follo&s Articles 22$1 and 22$2 of the Civil Code enu'erates certain credits &hich en?o3 preference &ith respect to specific personal or real propert3 of the de*tor. pecificall3, the contractors lien clai'ed *3 the petitioners is granted under the third paragraph of  Article 22$2 &hich provides that the clai's of contractors engaged in the construction, reconstruction or repair of *uildings or other &ors shall *e preferred &ith respect to the specific *uilding or other i''ova*le propert3 constructed.@o&ever, Article 22$2 onl3 finds application &hen there is a concurrence of credits, i.e., &hen the sa'e specific propert3 of the de*tor is su*?ected to the clai's of several creditors and the value of such propert3 of the de*tor is insufficient to pa3 in full all the creditors. 4n such a situation, the <uestion of preference &ill arise, that is, there &ill *e a need to deter'ine &hich of the creditors &ill *e paid ahead of the others. 5unda'ental tenets of due process &ill dictate that this statutor3 lien should then onl3 *e enforced in the conte=t of so'e ind of a proceeding &here the clai's of all the preferred creditors 'a3 *e *indingl3 ad?udicated, such as insolvenc3 proceedings.6 2/  (7'phasis supplied)4n this instance, neither Article 22$2 of the Civil Code nor the enforce'ent of the lien thereunder is applica*le, *ecause said provision applies onl3 to cases in &hich there are several creditors carr3ing on a legal action against an insolvent de*tor. Respondent is not a de*tor of the petitioner. Respondent is not a part3 to the Construction Agree'ent *et&een petitioner and 4nter'odal.  +he Court need not delve on the applica*ilit3 of Article 1912 of the Civil Code since petitioner did not allege this provision of la& as *asis for its co'plaint against respondent. 4t is a &ell-settled rule that the e=istence of a cause of action is deter'ined *3 the allegations in the co'plaint. 4n resolving a 'otion to dis'iss *ased on the failure to state a cause of action, onl3 the facts alleged in the co'plaint 'ust *e considered. 2> E@7R75R7, the petition is 447.  R7R7. G.R. No. %&801 $ar'( 20, 1))1DE*E!O$ENT +AN OF TE I!IINES,  petitioner, vs. TE $INISTER OF !A+OR a # SA$AANG AGAAISANG $ANGGAGAA SA R$C-GATCORD,  respondents.n 9 5e*ruar3 1>1, a'ahang !agaaisang anggaga&a sa RC-Gatcord (a'ahan for *revit3), in representation of its 1,000 &orersI'e'*ers, filed a co'plaint against Riverside ills Corporation (RC for *revit3) for non-pa3'ent of !residential ecree 1/19s !1.00 dail3 &age increase and !#0.00 'onthl3 7'ergenc3 Cost of 8iving Allo&ance (7C8A) &ith the inistr3 (no& epart'ent) of 8a*or and 7'plo3'ent. After trial, the inistr3s CR irector evero . !ucan issued an order on ul3 , 1>1 'andating RC 6to pa3 the co'plainants-a'ahan additional 'andator3 7C8A of !#0.00I'onth and the !1.00 increase in the 'ini'u' &age, retroactive as of August 1>1.6 eput3 inister icente 8eogardo, r. affir'ed the said decision on anuar3 #, 1>2, upon appeal *3 the co'pan3, Riverside ills Corporation.4t also appears that petitioner B! had instituted e=tra-?udicial foreclosure proceedings as earl3 as 1>9 on the properties and other assets of RC as a result of the latters failure to 'eet its o*ligations on the loan it had previousl3 secured fro' B!. +hereafter, the total *alance of the ?udg'ent a&ard in the la*or case previousl3 'entioned, &as reco'puted at three 'illion three hundred one thousand nine hundred ninet3 seven pesos and sevent3 five centavos (!9,901,/./%) in an order issued *3 irector evero . !ucan dated April 11, 1>%.n 21 anuar3 1>#, B! received a otice of Conference fro' evero !ucan of the inistr3 of 8a*or and 7'plo3'ent (87) ordering B! to appear *efore Att3. Ro*erto  A. ereJ on anuar3 29, 1># at 200 p.'. to testif3 in Case o. CR-5-2-20%->1. 4t &as onl3 in that conference that B! learned that the respondent-a'ahan &as a*le to secure a decision in its favor in the la*or case a*ove-'entioned, &hich the3 &anted to enforce against B!. n 21 April 1>#, a otice of Garnish'ent &as served upon B! for the a'ount of !9,901,/./%.+he pivotal issue in this case is &hether or not a &rit of garnish'ent 'a3 *e issued against the proceeds of RCs properties foreclosed *3 B! and sold to Rosario +e=tile ills, *3 the application of the &orers right of preference under Article 110 of the 8a*or Code.Repu*lic Act o. #/1% a'ending Article 110 of the 8a*or Code readsec. 1. Article 110 of !.. $$2, as a'ended, other&ise no&n as the 8a*or Code of the !hilippines, is here*3 further a'ended to read as follo&s Art. 110. Worker's preference in case of bankruptcy  . - 4n the event of *anruptc3 or li<uidation of the e'plo3ers *usiness, his &orers shall en?o3 first preference as regards their unpaid &ages and other monetary claims shall *e paid in full before the claims of the Government and other creditors may be paid  . (A'end'ents italiciJed) Accordingl3, ection 10, Rule 444, Boo 444 of the 'ni*us Rules 4'ple'enting the 8a*or Code has also *een a'ended *3 ection 4 of the Rules and Regulations 4'ple'enting R.A. #/1%, as approved *3 the then ecretar3 of 8a*or on a3 2$, 1>, &hich no& providesec. 10. Payment of waes and other monetary claims in case of bankruptcy  . - 4ncase of *anruptc3 or li<uidation of the e'plo3ers *usiness, the unpaid &ages and other 'onetar3 clai's of the e'plo3ees shall *e given first preference and shall *e paid in full *efore the clai's of the Govern'ent and other creditors 'a3 *e paid. ota*l3, the ter's 6declaration6 of *anruptc3 or 6?udicial6 li<uidation have *een eli'inated. @o&ever, despite said a'end'ents, the sa'e interpretation of Article 110 as applied in the case of Development !ank of the Philippines vs .   on .  #abor Arbiter Ariel $  .  %antos et al  . (1/1 CRA 19>) &as adopted *3 this Court in recent cases (G.R. o. >#92, B! vs. 8RC et al., une 2/, 10: G.R. os. >2/#9-#$, B! vs. 8RC et al., arch 1, 10).Because of its i'pact on the entire s3ste' of credit, Article 110 of the 8a*or Code cannot*e vie&ed in isolation of, and 'ust al&a3s *e reconed &ith the provisions of the Civil Code on concurrence and preference of credits (B! vs. 8RC, et al., supra ), thus, it 'a3 not *e invoed *3 e'plo3ees of RC, lie private respondent-a'ahan herein, in the a*sence of a for'al declaration of *anruptc3 or ?udicial li<uidation order.
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