G.R. No.

156067 In the latter action, Madrigal alleged (1) that it had entered into a joint venture
agreement with Lapanday for the primary purpose of operating vessels to service
THIRD DIVISION the shipping requirements of Del Monte Philippines, Inc.;[7] (2) that it had done
so on the strength of the representations of Lorenzo, in his capacity either as
[G.R. No. 156067. August 11, 2004]
chairman of the board or as president of Del Monte, Lapanday and Macondray;
MADRIGAL TRANSPORT, INC., petitioner, vs. LAPANDAY HOLDINGS CORPORATION; (3) that Macondray had thereafter been appointed -- allegedly upon the
MACONDRAY AND COMPANY, INC.; and LUIS P. LORENZO JR., respondents. insistence of Lapanday -- as broker, for the purpose of securing charter hire
contracts from Del Monte; (4) that pursuant to the joint venture agreement,
DECISION Madrigal had purchased a vessel by obtaining a P10,000,000 bank loan; and (5)
that contrary to their representations and guarantees and despite demands,
PANGANIBAN, J.: Lapanday and Lorenzo had allegedly been unable to deliver those Del Monte
charter hire contracts.[8]
The special civil action for certiorari and appeal are two different remedies that
are mutually exclusive; they are not alternative or successive. Where appeal is On February 23, 1998, the insolvency court (RTC Branch 49) declared petitioner
available, certiorari will not prosper, even if the ground therefor is grave abuse insolvent.[9] On March 30, 1998 and April 6, 1998, Respondents Lapanday,
of discretion. Basic is the rule that certiorari is not a substitute for the lapsed Lorenzo and Macondray filed their respective Motions to Dismiss the case
remedy of appeal. pending before the RTC Branch 36.[10]

The Case On December 16, 1998, Branch 36 granted the Motion, for failure of the
Complaint to state a cause of action. Applying Sections 32 and 33 of the
Before us is a Petition for Review[1] under Rule 45 of the Rules of Court,
Insolvency Law,[11] the trial court opined that upon the filing by Madrigal of a
assailing the February 28, 2002 Decision[2] and the November 5, 2002
Petition for Voluntary Insolvency, the latter lost the right to institute the
Resolution[3] of the Court of Appeals (CA) in CA-GR SP No. 54861. The
Complaint for Damages. The RTC ruled that the exclusive right to prosecute the
challenged Decision disposed as follows:
actions belonged to the court-appointed assignee.[12]
WHEREFORE, in consideration of the foregoing premises, private respondents
On January 26, 1999, petitioner filed a Motion for Reconsideration,[13] which
Lapanday and Lorenzo, Jr.s Motion for Reconsideration dated 10 February 2000 is
was later denied on July 26, 1999.[14] Subsequently, petitioner filed a Petition
GRANTED. Accordingly, the Resolution dated 10 January 2000 is RECONSIDERED
for Certiorari with the Court of Appeals, seeking to set aside the December 16,
and SET ASIDE, thereby dismissing the Petition for Certiorari dated 10 September
1998 and the July 26, 1999 Orders of the trial court.[15] On September 29, 1999,
1999.[4]
the CA issued a Resolution requiring petitioner to explain why its Petition should
The assailed Resolution denied reconsideration. not be dismissed outright, on the ground that the questioned Orders should have
been elevated by ordinary appeal.[16]
The Facts
On January 10, 2000, the appellate court ruled that since the main issue in the
The pertinent facts are undisputed. On February 9, 1998, Petitioner Madrigal instant case was purely legal, the Petition could be treated as one for review as
Transport, Inc. (Madrigal) filed a Petition for Voluntary Insolvency before the an exception to the general rule that certiorari was not proper when appeal was
Regional Trial Court (RTC) of Manila, Branch 49.[5] Subsequently, on February available.[17] Respondents Lapanday and Lorenzo challenged this ruling through
21, 1998, petitioner filed a Complaint for damages against Respondents a Motion for Reconsideration dated February 10, 2000.[18] The CA heard the
Lapanday Holdings Corporation (Lapanday), Macondray and Company, Inc. Motion for Reconsideration in oral arguments on April 7, 2000.[19]
(Macondray), and Luis P. Lorenzo Jr. before the RTC of Manila, Branch 36.[6]
 Ruling of the Court of Appeals II

On February 28, 2002, the appellate court issued the assailed Decision granting The Honorable Court of Appeals committed serious error in ruling that it had no
Respondents Lapanday and Lorenzos Motion for Reconsideration and dismissing jurisdiction to entertain the Petition for Certiorari filed by petitioner before it.
Madrigals Petition for Certiorari. The CA opined that an order granting a motion
to dismiss was final and thus the proper subject of an appeal, not certiorari.[20] A. Section 2, Rule 50 nor Section 2(c) and Section 2(c), Rule 41 find no
application in the present case, since said rule contemplates of a case where an
Furthermore, even if the Petition could be treated as an appeal, it would still appeal is the proper remedy, and not where the appropriate remedy is a petition
have to be dismissed for lack of jurisdiction, according to the CA.[21] The for certiorari where questions of facts and laws may be reviewed by the court a
appellate court held that the issues raised by petitioner involved pure questions quo.
of law that should be brought to the Supreme Court, pursuant to Section 2 of
Rule 50 and Section 2(c) of Rule 41 of the Rules of Court.[22] B. The court a quo erroneously concluded that it has no jurisdiction over the
subject matter of the petition based on the wrong premise that an appeal from
Hence, this Petition.[23] the lower courts dismissal order is the proper remedy by applying Section 2, Rule
50 and Section 2(c), Rule 41 of the Rules of Court.[24]
The Issues
The Courts Ruling
In its Statement of Issues, petitioner contends:
The Petition is unmeritorious.
I
First Issue:
The Honorable Court of Appeals committed egregious error by ruling that the
order of the lower court which granted private respondents Motions to Dismiss Remedy Against Dismissal of Complaint
are not proper subjects of a Petition for Certiorari under Rule 65.
The resolution of this case hinges on the proper remedy: an appeal or a petition
A. Section 5, Rule 16 does not apply in the present case since the grounds for for certiorari. Petitioner claims that it correctly questioned the trial courts
dismissal [were] petitioners purported lack of capacity to sue and its failure to Order through its Petition for Certiorari. Respondents insist that an ordinary
state a cause of action against private respondents, and not any of the three (3) appeal was the proper remedy. We agree with respondents.
grounds provided under said provision, namely, res judicata, extinction of the
claim, and Statute of Frauds. Appeal

B. Section 1 of Rule 41, which is the applicable provision in petitioners case, Under Rule 41, Rules of Court, an appeal may be taken from a judgment or final
expressly proscribes the taking of an appeal from an order denying a motion for order that completely disposes of the case, or of a particular matter therein
reconsideration or one which dismisses an action without prejudice, instead, the when declared by the Rules of Court to be appealable.[25] The manner of
proper remedy is a special civil action under Rule 65. appealing an RTC judgment or final order is also provided in Rule 41 as follows:

C. A petition for certiorari under Rule 65 was correctly resorted to by petitioner Section 2. Modes of appeal.
from the dismissal order of the lower court, which had clearly acted with grave
(a) Ordinary appeal. The appeal to the Court of Appeals in cases decided by the
abuse of discretion amounting to lack of jurisdiction.
Regional Trial Court in the exercise of its original jurisdiction shall be taken by
filing a notice of appeal with the court which rendered the judgment or final
order appealed from and serving a copy thereof upon the adverse party. No
record on appeal shall be required except in special proceedings and other cases For certiorari to prosper, the following requisites must concur: (1) the writ is
of multiple or separate appeals where the law or these Rules so require. In such directed against a tribunal, a board or any officer exercising judicial or quasi-
cases, the record on appeal shall be filed and served in like manner. judicial functions; (2) such tribunal, board or officer has acted without or in
excess of jurisdiction, or with grave abuse of discretion amounting to lack or
(b) Petition for review. The appeal to the Court of Appeals in cases decided by excess of jurisdiction; and (3) there is no appeal or any plain, speedy and
the Regional Trial Court in the exercise of its appellate jurisdiction shall be by adequate remedy in the ordinary course of law.[30]
petition for review in accordance with Rule 42.
Without jurisdiction means that the court acted with absolute lack of
(c) Appeal by certiorari. In all cases where only questions of law are raised or authority.[31] There is excess of jurisdiction when the court transcends its power
involved, the appeal shall be to the Supreme Court by petition for review on or acts without any statutory authority.[32] Grave abuse of discretion implies
certiorari in accordance with Rule 45.[26] such capricious and whimsical exercise of judgment as to be equivalent to lack
or excess of jurisdiction; in other words, power is exercised in an arbitrary or
An order or a judgment is deemed final when it finally disposes of a pending
despotic manner by reason of passion, prejudice, or personal hostility; and such
action, so that nothing more can be done with it in the trial court. In other
exercise is so patent or so gross as to amount to an evasion of a positive duty or
words, the order or judgment ends the litigation in the lower court. Au
to a virtual refusal either to perform the duty enjoined or to act at all in
contraire, an interlocutory order does not dispose of the case completely, but
contemplation of law.[33]
leaves something to be done as regards the merits of the latter.[27]
Appeal and Certiorari Distinguished
Petition for Certiorari
Between an appeal and a petition for certiorari, there are substantial
A petition for certiorari is governed by Rule 65, which reads:
distinctions which shall be explained below.
Section 1. Petition for certiorari. When any tribunal, board or officer exercising
As to the Purpose. Certiorari is a remedy designed for the correction of errors of
judicial or quasi-judicial functions has acted without or in excess of its or his
jurisdiction, not errors of judgment.[34] In Pure Foods Corporation v. NLRC, we
jurisdiction, or with grave abuse of discretion amounting to lack or excess of its
explained the simple reason for the rule in this light:
or his jurisdiction, and there is no appeal, or any plain, speedy, and adequate
remedy in the ordinary course of law, a person aggrieved thereby may file a When a court exercises its jurisdiction, an error committed while so engaged
verified petition in the proper court, alleging the facts with certainty and does not deprive it of the jurisdiction being exercised when the error is
praying that judgment be rendered annulling or modifying the proceedings of committed. If it did, every error committed by a court would deprive it of its
such tribunal, board or officer, and granting such incidental reliefs as law and jurisdiction and every erroneous judgment would be a void judgment. This
justice may require. cannot be allowed. The administration of justice would not survive such a rule.
Consequently, an error of judgment that the court may commit in the exercise of
The petition shall be accompanied by a certified true copy of the judgment,
its jurisdiction is not correct[a]ble through the original civil action of
order or resolution subject thereof, copies of all pleadings and documents
certiorari.[35]
relevant and pertinent thereto, and a sworn certification of non-forum shopping
as provided in the third paragraph of Section 3, Rule 46.[28] The supervisory jurisdiction of a court over the issuance of a writ of certiorari
cannot be exercised for the purpose of reviewing the intrinsic correctness of a
A writ of certiorari may be issued only for the correction of errors of jurisdiction
judgment of the lower court -- on the basis either of the law or the facts of the
or grave abuse of discretion amounting to lack or excess of jurisdiction. The writ
case, or of the wisdom or legal soundness of the decision.[36] Even if the
cannot be used for any other purpose, as its function is limited to keeping the
findings of the court are incorrect, as long as it has jurisdiction over the case,
inferior court within the bounds of its jurisdiction.[29]
such correction is normally beyond the province of certiorari.[37] Where the afford the tribunal an opportunity to correct the alleged errors. Note also that
error is not one of jurisdiction, but of an error of law or fact -- a mistake of this motion is a plain and adequate remedy expressly available under the
judgment -- appeal is the remedy. [38] law.[50] Such motion is not required before appealing a judgment or final
order.[51]
As to the Manner of Filing. Over an appeal, the CA exercises its appellate
jurisdiction and power of review. Over a certiorari, the higher court uses its Certiorari Not the Proper Remedy if Appeal Is Available
original jurisdiction in accordance with its power of control and supervision over
the proceedings of lower courts. [39] An appeal is thus a continuation of the Where appeal is available to the aggrieved party, the action for certiorari will
original suit, while a petition for certiorari is an original and independent action not be entertained. Remedies of appeal (including petitions for review) and
that was not part of the trial that had resulted in the rendition of the judgment certiorari are mutually exclusive, not alternative or successive.[52] Hence,
or order complained of.[40] The parties to an appeal are the original parties to certiorari is not and cannot be a substitute for an appeal, especially if ones own
the action. In contrast, the parties to a petition for certiorari are the aggrieved negligence or error in ones choice of remedy occasioned such loss or lapse.[53]
party (who thereby becomes the petitioner) against the lower court or quasi- One of the requisites of certiorari is that there be no available appeal or any
judicial agency, and the prevailing parties (the public and the private plain, speedy and adequate remedy.[54] Where an appeal is available, certiorari
respondents, respectively).[41] will not prosper, even if the ground therefor is grave abuse of discretion.

As to the Subject Matter. Only judgments or final orders and those that the Rules Second Issue:
of Court so declare are appealable.[42] Since the issue is jurisdiction, an original
CA Jurisdiction
action for certiorari may be directed against an interlocutory order of the lower
court prior to an appeal from the judgment; or where there is no appeal or any Petitioner was ascribing errors of judgment, not jurisdiction, in its Petition for
plain, speedy or adequate remedy.[43] Certiorari filed with the Court of Appeals. The issue raised there was the trial
courts alleged error in dismissing the Complaint for lack of cause of action.
As to the Period of Filing. Ordinary appeals should be filed within fifteen days
Petitioner argues that it could still institute the Complaint, even if it had filed a
from the notice of judgment or final order appealed from.[44] Where a record on
Petition for Insolvency earlier.[55] As petitioner was challenging the trial courts
appeal is required, the appellant must file a notice of appeal and a record on
interpretation of the law -- posing a question of law -- the issue involved an error
appeal within thirty days from the said notice of judgment or final order.[45] A
of judgment, not of jurisdiction. An error of judgment committed by a court in
petition for review should be filed and served within fifteen days from the notice
the exercise of its legitimate jurisdiction is not necessarily equivalent to grave
of denial of the decision, or of the petitioners timely filed motion for new trial
abuse of discretion.[56]
or motion for reconsideration.[46] In an appeal by certiorari, the petition should
be filed also within fifteen days from the notice of judgment or final order, or of The instant case falls squarely with Barangay Blue Ridge A of QC v. Court of
the denial of the petitioners motion for new trial or motion for Appeals.[57] In that case, the trial court granted the Motion to Dismiss on the
reconsideration.[47] ground of failure to state a cause of action. After the Motion for Reconsideration
was denied, petitioner filed a Petition for Certiorari with the CA. The appellate
On the other hand, a petition for certiorari should be filed not later than sixty
court denied the Petition on the ground that the proper remedy was appeal.
days from the notice of judgment, order, or resolution.[48] If a motion for new
Holding that an error of judgment should be reviewed through an ordinary
trial or motion for reconsideration was timely filed, the period shall be counted
appeal, this Court upheld the CA.
from the denial of the motion.[49]

As to the Need for a Motion for Reconsideration. A motion for reconsideration is

generally required prior to the filing of a petition for certiorari, in order to
 The Dismissal -- a Final Order judgment, however, do not constitute a despotic, capricious, or whimsical
exercise of power. On the contrary, petitioner availed of certiorari because the
An order of dismissal, whether correct or not, is a final order.[58] It is not 15-day period within which to file an appeal had already lapsed. Basic is the rule
interlocutory because the proceedings are terminated; it leaves nothing more to that certiorari is not a substitute for the lapsed remedy of appeal.
be done by the lower court. Therefore the remedy of the plaintiff is to appeal
the order.[59] As previously stressed, appeal -- not certiorari -- was the correct remedy to
elevate the RTCs Order granting the Motion to Dismiss. The appeal, which would
Petitioner avers that Section 5 of Rule 16[60] bars the filing of an appeal when have involved a pure question of law, should have been filed with the Supreme
the dismissal is based on lack of cause of action. It adds that Section 5 limits the Court pursuant to Section 2 (c) of Rule 41 and Section 2 of Rule 50,[67] Rules of
remedy of appeal only to dismissals grounded on prior judgments or on the Court.
statute of limitations, or to claims that have been extinguished or are
unenforceable. We find this interpretation absurd. WHEREFORE, this Petition is DENIED, and the challenged Decision and Resolution
AFFIRMED.
The provision is clear. Dismissals on the aforesaid grounds constitute res
judicata. However, such dismissals are still subject to a timely appeal. For those Costs against petitioner.
based on other grounds, the complaint can be refiled. Section 5, therefore,
confirms that an appeal is the remedy for the dismissal of an action. SO ORDERED.

Citing Sections 1(a) and 1(h), Rule 41,[61] petitioner further claims that it was
prohibited from filing an appeal. Section 1(a) of the said Rule prohibits the filing
of an appeal from an order denying a motion for reconsideration, because the
remedy is to appeal the main decision as petitioner could have done. In fact,
under Section 9, Rule 37, the remedy against an order denying a motion for
reconsideration is to appeal the judgment or final order. Section 1(h) does not
apply, because the trial courts Order did not dismiss the action without
prejudice.[62]

Exception to the Rule Not Established by Petitioner

We are not unaware of instances when this Court has granted certiorari despite
the availability of appeal.[63] Where the exigencies of the case are such that the
ordinary methods of appeal may not prove adequate -- either in point of
promptness or completeness, so that a partial if not a total failure of justice
could result -- a writ of certiorari may still be issued.[64] Petitioner cites some
of these exceptions to justify the remedy it has undertaken with the appellate
court,[65] but these are not applicable to the present factual milieu.

Even assuming that the Order of the RTC was erroneous, its error did not
constitute grave abuse of discretion. Petitioner asserts that the trial court should
not have dismissed the Complaint or should have at least allowed the
substitution of the assignee in petitioners stead.[66] These alleged errors of