Dadiangas West Central Elementary School Teachers Cooperative v. Leyva

SECOND DIVISION

[G.R. No. 219719. January 24, 2018.]

DADIANGAS WEST CENTRAL ELEMENTARY SCHOOL TEACHERS COOPERATIVE, represented by its Chairman, Orlando O. Padasay, petitioner,vs. DANILO D. LEYVA, LUZ S. ALMEDA, ISABELITA M. BORRES, ALLAN G. FARNAZO, ESTRELLA C. LARIOSA, LIZETTE MAY ISABEL N. DIOSO, RONNIE R. SUNGGAY, RENATO U. ODI, and ANECITO C. TAN, JR., respondents.

NOTICE

Sirs/Mesdames :

Please take notice that the Court, Second Division, issued a Resolution dated 24 January 2018 which reads as follows:

"G.R. No. 219719: DADIANGAS WEST CENTRAL ELEMENTARY SCHOOL TEACHERS COOPERATIVE, represented by its Chairman, Orlando O. Padasay, petitioner,v. DANILO D. LEYVA, LUZ S. ALMEDA, ISABELITA M. BORRES, ALLAN G. FARNAZO, ESTRELLA C. LARIOSA, LIZETTE MAY ISABEL N. DIOSO, RONNIE R. SUNGGAY, RENATO U. ODI, and ANECITO C. TAN, JR., respondents.

This is a petition for review 1 assailing the 8 December 2014 Decision 2 and 1 July 2015 Resolution 3 of the Court of Appeals in CA-G.R. SP No. 05434. The Court of Appeals dismissed the petition for certiorari4 filed by Orlando O. Padasay (Padasay) against the Presiding Judge of the Regional Trial Court (RTC) of General Santos City, Branch 37, and respondents. The Court of Appeals denied the motion for reconsideration.

On 30 June 2008, Dadiangas West Central Elementary School Teachers Cooperative (Cooperative), represented by its Chairman, Orlando O. Padasay, filed a Complaint for Injunction with Prayer for Writ of Preliminary Prohibitory Injunction and Temporary Restraining Order against Zenaida A. Gulle, the then Principal of Dadiangas West Central Elementary School, before the RTC of General Santos City, Branch 37, docketed as Civil Case No. 7805. The complaint alleged that the Cooperative "has the privilege to conduct its preschool classes within the Dadiangas West Central School premises by virtue of the Memorandum of Agreement x x x and as provided for under Article 63, par. (2) of R.A. 6938 x x x." 5 The complaint sought to enjoin Gulle from supposedly interfering with the preschool operation of the Cooperative.

On 8 July 2008, the Office of the Solicitor General (OSG), upon the request for assistance of the Schools Division Superintendent Estrella C. Lariosa, filed its Formal Entry of Appearance. On 25 November 2008, the OSG filed its Answer with Counterclaim praying for the dismissal of the complaint.

On 15 December 2008, the RTC issued an Order referring the case to the Philippine Mediation Center for possible conciliation. In the meantime, the RTC ordered that the status quo be maintained pending the mediation proceedings.

On 10 July 2012, the RTC issued an Order holding in abeyance the proceedings in Civil Case No. 7805 until the resolution of the petition for injunction filed by the Department of Education Regional Office No. XI pending before the RTC, General Santos City, Branch 22, docketed as Special Civil Case No. 687.

On 5 November 2012, Padasay filed an Omnibus Motion in Civil Case No. 7805, pleading among others that the status quo order be declared permanent and that hearings for the charge of indirect contempt be set to determine the liability of respondents.

On 16 November 2012, the RTC issued an Order noting that the Omnibus Motion was not signed by counsel and treating the same as a mere scrap of paper.

Padasay filed a Motion for Reconsideration which the RTC in an Order dated 4 January 2013 refused to take cognizance because it was not signed by counsel.

Padasay, as Chairman of the Cooperative, filed a petition for certiorari before the Court of Appeals alleging that the RTC judge committed grave abuse of discretion in refusing to act on the Omnibus Motion on the ground that it was not signed by counsel. The petition contended that under Section 34, Rule 138 of the Rules of Court, a party may conduct his litigation personally.

In its 8 December 2014 Decision, the Court of Appeals dismissed the petition for certiorari. It stated that "[t]he Rules allow a non-lawyer to conduct litigation in person and appear for oneself only when he is a party to a legal controversy," 6 pursuant to Section 34, Rule 138 of the Rules of Court.

The Court of Appeals cited the case of Santos v. Judge Lacurom 7where the Court admonished the complainant for litigating her case personally despite being adequately represented by her own lawyer. The Court of Appeals ruled that the RTC judge did not act with grave abuse of discretion when it refused to take cognizance of the motions since the Cooperative has a counsel of record in the person of Atty. Pedro G. Nalangan III (Atty. Nalangan III).

In its 1 July 2015 Resolution, the Court of Appeals denied the motion for reconsideration. Hence, this petition.

The sole issue in this case is whether the Court of Appeals erred in ruling that the RTC judge did not commit grave abuse of discretion in refusing to act on the motions filed and signed by Padasay, who is not a lawyer, and not by the counsel of record.

The petition lacks merit.

Padasay, as the Chairman of the Cooperative, invokes the right of a party to litigate a case personally. He relies on Section 34, Rule 138 of the Rules of Court which reads:

Section 34. By whom litigation conducted. — In the court of a justice of the peace a party may conduct his litigation in person, with the aid of an agent or friend appointed by him for the purpose, or with the aid of an attorney. In any other court, a party may conduct his litigation personally or by aid of an attorney, and his appearance must be either personal or by a duly authorized member of the bar. (Emphasis supplied)

Indeed, a party to a case has a right to conduct his or her litigation personally. In Cruz v. Mijares, 8 the Court held:

From the clear language of this provision of the Rules, it will have to be conceded that the contention of the petitioner has merit. It recognizes the right of an individual to represent himself in any case to which he is a party. The Rules state that a party may conduct his litigation personally or with the aid of an attorney, and that his appearance must either be personal or by a duly authorized member of the Bar. The individual litigant may personally do everything in the course of proceedings from commencement to the termination of the litigation. Considering that a party personally conducting his litigation is restricted to the same rules of evidence and procedure as those qualified to practice law, petitioner, not being a lawyer himself, runs the risk of falling into the snares and hazards of his own ignorance. (Emphasis supplied)

In this case, there is no dispute that the Cooperative is the plaintiff in Civil Case No. 7805. The Complaint states that "plaintiff is a duly organized primary non-agri multipurpose cooperative and registered with the Cooperative Development Authority, represented herein by its Chairman of the Board, Orlando O. Padasay x x x." 9 Clearly, the Cooperative, and not Padasay, is the party which filed the complaint for injunction before the RTC.

The question now is whether the Cooperative can litigate the case personally.

The Cooperative, once it is registered with the Cooperative Development Authority, is considered a juridical person with its own personality separate and distinct from its officers and members. 10 Similar to a corporation, the Cooperative acts through its board of directors, unless otherwise provided in its by-laws. 11

In Republic of the Philippines v. Asiapro Cooperative, 12 the Court held:

It bears stressing, too, that a cooperative acquires juridical personality upon its registration with the Cooperative Development Authority. It has its Board of Directors, which directs and supervises its business; meaning, its Board of Directors is the one in charge in the conduct and management of its affairs. With that, a cooperative can be likened to a corporation with a personality separate and distinct from its owners-members. x x x.

x x x. Clearly then, the management of the affairs of the respondent cooperative is vested in its Board of Directors and not in its owners-members as a whole. x x x.

There is no question that parties in lawsuits who are natural persons may conduct litigations personally since natural persons can actually appear before the courts, argue in front of a judge and file or sign pleadings or motions. On the other hand, parties that are juridical persons obviously cannot appear before the courts or sign pleadings being mere creatures of law. In such a case, for the orderly administration of justice, juridical persons should be assisted by a lawyer duly authorized by their board of directors to perform such function. Section 34, Rule 138 clearly provides that "[i]n any other court, a party may conduct his litigation personally or by aid of an attorney, and his appearance must be either personal or by a duly authorized member of the bar."

In this case, since the Cooperative is a juridicial person, it must be represented by a counsel in actions filed by or against it. 13

Moreover, since the Cooperative is the party in Civil Case No. 7805, Padasay, who is the Chairman of the Board of Directors of the Cooperative, is not a real party in interest. The party in Civil Case No. 7805 is the Cooperative, which is a juridical person with a personality separate from its officers and members, and not Padasay. Consequently, Padasay has no personality to litigate this case personally since he is not the real party in interest. In Consumido v. Ros, 14 the Court held:

One who has no right or interest to protect cannot invoke the jurisdiction of the court as party-plaintiff in action for it is jurisprudentially ordained that every action must be prosecuted or defended in the name of the real party in interest.

"Interest" within the meaning of the rules means material interest, an interest in issue and to be affected by the decree as distinguished from mere interest in the question involved, or a mere incidental interest. A real party in interest is one who has a legal right. Since a contract may be violated only by the parties thereto as against each other, in an action upon that contract, the real parties-in-interest, either as plaintiff or as defendant, must be parties to the said contract. The action must be brought by the person who, by substantive law, possesses the right sought to be enforced.

Further, when Padasay filed the motions in the RTC, the Cooperative was still represented by its counsel, Atty. Pedro G. Nalangan III. There is nothing in the records to show that a notice of withdrawal of appearance by counsel was filed prior to the filing of the motions by Padasay. In other words, the Cooperative remained represented by counsel when the motions were signed and filed by Padasay.

Padasay claims that he is the employer of the hired counsel who can exercise his right to dispense with the services of his counsel at anytime if he decides to litigate the case personally. In fact, Padasay claims that he terminated the services of Atty. Nalangan III on 29 December 2014 and submitted a Manifestation to that effect. 15 This contention, however, assumes that the Cooperative acted through Padasay as Chairman, and not through its Board of Directors. This violates Article 37 of the Philippine Cooperative Code of 2008, which expressly vests in the board of directors the management of the affairs of the cooperative.

In addition, Padasay errs in citing the second paragraph of Article 140 (7) of Republic Act No. 9520 16 to support his contention that he can personally litigate the present case. This provision states:

The cooperative or any of its members can file a case against any officer or employee of the Bureau of Internal Revenue or of any other government agency with the Ombudsman, Civil Service Commission, other appropriate government agency or the courts of law.

This provision pertains to the filing of a case by the cooperative or any of its members against any officer or employee of the Bureau of Internal Revenue or of any other government agency. This is inapplicable to this case since this is not a case against any officer or employee of the Bureau of Internal Revenue or of any other government agency. Civil Case No. 7805 is for injunction against the then Principal of Dadiangas West Central Elementary School, who is not an officer of the Bureau of Internal Revenue or of any government agency.

Lastly, the RTC did not err in treating the motions as unsigned pleadings since a signed pleading is one that is signed either by the party himself or his counsel. Section 3, Rule 7 of the Rules of Court is clear on this matter. It requires that a pleading must be signed by the party or counsel representing him. In Republic of the Philippines v. Kenrick Development Corporation, 17 the Court held:

x x x only the signature of either the party himself or his counsel operates to validly convert a pleading from one that is unsigned to one that is signed.

Counsel's authority and duty to sign a pleading are personal to him. He may not delegate it to just any person.

As stated, the Cooperative was still represented by counsel, Atty. Nalangan III, when the questioned motions were filed and signed by Padasay. Therefore, only the signature of Atty. Nalangan III, as the then counsel of the Cooperative, could validly convert the motions from being unsigned to signed.

WHEREFORE, the Court DENIES the petition and AFFIRMS the assailed decision and resolution of the Court of Appeals in CA-G.R. SP No. 05434.

SO ORDERED."

Very truly yours,

MA. LOURDES C. PERFECTODivision Clerk of Court

By:

(SGD.) TERESITA AQUINO TUAZONDeputy Division Clerk of Court

Footnotes

1. Under Rule 45 of the Rules of Court.

2.Rollo, pp. 26-31. Penned by Associate Justice Edgardo T. Lloren, with Associate Justices Edward B. Contreras and Rafael Antonio M. Santos concurring.

3.Id. at 32-33.

4. Under Rule 65 of the Rules of Court.

5.Rollo, p. 127.

6.Id. at 29.

7. 531 Phil. 239 (2006).

8. 586 Phil. 433, 441 (2008).

9.Rollo, p. 123.

10. Article 16 of the Philippine Cooperative Code of 2008 provides:

   ART. 16. Registration. — A cooperative formed and organized under this Code acquires juridical personality from the date the [Cooperative Development] Authority issues a certificate of registration under its official seal. x x x.

11. Article 37 of the Philippine Cooperative Code of 2008 provides:

   ART. 37. Composition and Term of the Board of Directors. — Unless otherwise provided in the bylaws, the direction and management of the affairs of a cooperative shall be vested in a board of directors x x x.

   Article 38 of the Philippine Cooperative Code of 2008 provides:

   ART. 38. Powers of the Board of Directors. — The board of directors shall be responsible for the strategic planning, direction-setting and policy-formulation activities of the cooperatives.

12. 563 Phil. 979, 1001-1002 (2007).

13. See Timothy G. Cotner, May a Corporation Act as Its Own Attorney?, Cleveland State University [email protected], Cleveland State Law Review, 1967 <http://engagedscholarship.csuohio.edu/cgi/viewcontent.cgi?article=2952&context=clevstlrev> (visited on 5 January 2018).

14. 555 Phil. 652, 658 (2007).

15.Rollo, p. 62.

16. AN ACT AMENDING THE COOPERATIVE CODE OF THE PHILIPPINES TO BE KNOWN AS THE "PHILIPPINE COOPERATIVE CODE OF 2008."

17. 529 Phil. 876, 884 (2006).