The Supreme Court affirmed that appeals raising only questions of law from the Regional Trial Court (RTC) must be brought directly to the Supreme Court via a petition for review on certiorari, not to the Court of Appeals (CA). This procedural requirement ensures that the CA does not overstep its jurisdiction by resolving purely legal issues, which are within the Supreme Court’s purview. The decision underscores the importance of adhering to the prescribed modes of appeal to maintain the integrity of the judicial process and avoid unnecessary delays.

Cockfighting, Permits, and Proper Procedure: Who Decides and How to Appeal?

This case began when Antonio Escoto and the late Edgar Laxamana, as promoters of Legend International Resort Limited (LIRL), organized a cockfighting derby within the Subic Bay Freeport Zone. They obtained a permit from the Subic Bay Metropolitan Authority (SBMA), but the Philippine Amusement and Gaming Corporation (PAGCOR) intervened, asserting that such activities fell outside LIRL’s permitted scope as a hotel casino resort. Escoto and Laxamana then filed a suit for injunction against PAGCOR in the RTC to stop PAGCOR from preventing the derby.

The RTC dismissed the complaint, leading Escoto and Laxamana to appeal. PAGCOR moved to dismiss the appeal, arguing that the issues raised were purely legal, requiring a direct appeal to the Supreme Court. The Court of Appeals agreed, dismissing the appeal based on procedural grounds. This dismissal was rooted in the appellants raising questions of law that were outside the competence of an ordinary appeal under Rule 41 of the Rules of Court.

The core of the Supreme Court’s decision hinged on whether the appeal involved questions of law or fact. According to the Rules of Court, appeals involving only questions of law must be brought directly to the Supreme Court via a petition for review on certiorari. This contrasts with appeals involving questions of fact or mixed questions of fact and law, which are typically within the jurisdiction of the Court of Appeals.

Section 2. Modes of appeal.

(c) Appeal by certiorari.- In all cases where only questions of law are raised or involved, the appeal shall be to the Supreme Court by petition for review on certiorari in accordance with Rule 45. (n)

The distinction between questions of law and questions of fact is crucial. A question of law arises when there is doubt or disagreement about what the law is on a given set of facts. Conversely, a question of fact arises when the doubt or disagreement pertains to the truth or falsehood of alleged facts. The Supreme Court emphasized that the test to determine whether a question is one of law or fact is whether the appellate court can resolve the issue without reviewing or evaluating evidence. If no such review is necessary, it is a question of law; otherwise, it is a question of fact. To the CA, the question of law revolved around the applicability of Republic Act No. 7227 versus Republic Act No. 7160 regarding the authority to issue permits.

In this case, the Supreme Court agreed with the Court of Appeals’ determination that the issues presented were purely legal. The primary question was which law, Republic Act No. 7227 (The Bases Conversion and Development Act of 1992) or Republic Act No. 7160 (The Local Government Code), governed the authority to issue permits for cockfighting derbies within the Subic Bay Freeport Zone. This determination required interpreting the relevant statutes and applying them to the facts—a purely legal exercise.

The issue of attorney’s fees further solidified the legal nature of the appeal. Since the parties had expressly agreed on the attorney’s fees, including the amount, the court was not required to delve into factual matters to determine whether the fees were warranted under Article 2208 of the Civil Code. The agreement transformed the attorney’s fees into liquidated damages, which, unlike other forms of actual damages, do not require proof. Therefore, the resolution of this issue also involved applying legal principles to undisputed facts.

The petitioner attempted to argue that the appeal involved mixed questions of fact and law, citing the nature of the contract between the promoters and LIRL and the characteristics of the cockfighting activity. However, the Supreme Court rejected this argument because it was raised for the first time on appeal. The Court reiterated the well-established principle that issues not brought to the attention of the Court of Appeals cannot be raised for the first time before the Supreme Court.

Section 2. Dismissal of improper appeal to the Court of Appeals.

An appeal under Rule 41 taken from the Regional Trial Court to the Court of Appeals raising only questions of law shall be dismissed, issues purely of law not being reviewable by said court.

The Supreme Court’s decision underscores the importance of adhering to procedural rules in appellate practice. Specifically, it reinforces the principle that appeals raising only questions of law must be brought directly to the Supreme Court via a petition for review on certiorari. Failure to comply with this requirement can result in the dismissal of the appeal, regardless of the merits of the substantive issues.

This ruling also highlights the distinction between questions of law and questions of fact, providing guidance for practitioners in determining the appropriate mode of appeal. By clarifying these procedural requirements, the Supreme Court aims to promote efficiency and consistency in the appellate process, ensuring that cases are resolved in the proper forum.

FAQs

What was the key issue in this case?	The key issue was whether the appeal involved questions of law or fact, as this determined the proper appellate court. The Supreme Court affirmed that appeals raising only questions of law must be brought directly to the Supreme Court.
What is a question of law?	A question of law arises when there is doubt or disagreement about what the law is on a given set of facts. It involves interpreting legal principles and applying them to specific situations.
What is a question of fact?	A question of fact arises when there is doubt or disagreement about the truth or falsehood of alleged facts. It involves evaluating evidence and determining what actually occurred.
Why was the appeal dismissed by the Court of Appeals?	The Court of Appeals dismissed the appeal because it determined that the issues raised were purely legal, which meant the appeal should have been filed directly with the Supreme Court via a petition for review on certiorari.
What is a petition for review on certiorari?	A petition for review on certiorari is a mode of appeal to the Supreme Court that is used when the appeal involves only questions of law. It is governed by Rule 45 of the Rules of Court.
What was the significance of the attorney’s fees issue in this case?	The attorney’s fees issue was significant because the parties had expressly agreed on the fees, transforming them into liquidated damages. This meant that the court did not need to delve into factual matters to determine whether the fees were warranted, further solidifying the legal nature of the appeal.
Can new issues be raised for the first time on appeal to the Supreme Court?	No, the Supreme Court generally does not consider issues that are raised for the first time on appeal. Issues must be brought to the attention of the lower courts to be considered on appeal.
What is the practical implication of this ruling?	The practical implication is that litigants must carefully assess the nature of the issues they are raising on appeal to ensure that they are pursuing the proper mode of appeal. Failure to do so can result in the dismissal of the appeal.

This case underscores the necessity of understanding and adhering to the procedural rules governing appeals. By correctly identifying the nature of the issues—whether questions of law or fact—litigants can ensure that their appeals are filed in the appropriate court, avoiding unnecessary delays and potential dismissals.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Antonio Escoto vs. Philippine Amusement and Gaming Corporation, G.R. No. 192679, October 17, 2016