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Outline and explain the general structure of your country’s court system as it relates to the commercial appellate process.
Philippine appellate courts may either be regional, for cases originating from municipal or city courts, or national, for cases originating from regional courts. There are also multiple levels of appellate review since the Philippines observes the principle of judicial hierarchy.
Regional trial courts exercise both original and appellate jurisdiction. They exercise appellate jurisdiction over all cases decided by metropolitan trial courts, municipal trial courts, municipal trial court in cities and municipal circuit trial courts in their respective territorial jurisdictions. Some regional trial courts are designated as special commercial courts to try and decide cases involving violations of intellectual property rights and of Presidential Decree No. 902-A (or the Securities and Exchange Commission Reorganisation Act), but special commercial courts retain their appellate jurisdiction.
The Court of Appeals and Supreme Court also exercise both original and appellate jurisdiction. The Court of Appeals exercises exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards of regional trial courts and quasi-judicial agencies, instrumentalities, boards or commissions, except for certain cases provided by law. The Supreme Court exercises appellate jurisdiction by way of petition for review on certiorari over judgments, final orders or resolutions of the Court of Appeals, the anti-graft court (Sandiganbayan), the Court of Tax Appeals, the regional trial court or other courts, whenever authorised by the Philippine Constitution and by law.
The Court of Tax Appeals is an appellate court that exercises jurisdiction over civil and criminal tax cases, including appeals from rulings and assessments of the Bureau of Internal Revenue and Bureau of Customs.
Are there appellate courts that hear only civil matters?
Philippine appellate courts entertain appeals for both civil and criminal cases.
Appeals from administrative tribunals
Are appeals from administrative tribunals handled in the same way as appeals from trial courts?
Generally, appeals from administrative tribunals performing quasi-judicial functions are heard by the Court of Appeals and handled in the same manner as appeals in civil cases from the trial courts. However, certain administrative agencies have their own rules governing periods for lodging an appeal and the form of the appellate pleading to be filed. Philippine courts also follow the rule on exhaustion of administrative remedies, which provides that all administrative remedies must be exhausted first before the courts’ judicial power may be sought (Republic v Transunion Corporation, G R No. 191590, 21 April 2014).
Representation before appellate courts
Is there a separate appellate bar or other requirement for attorneys to be admitted before appellate courts?
There are no additional requirements for Philippine lawyers to engage in appellate practice. A person licenced to practice law in this jurisdiction may engage in any activity, in or out of court, which requires the application of law, legal procedures, knowledge, training and experience (Ulep v Legal Clinic, B M No. 553, 17 June 1993).
If separate jurisdictions exist for particular territorial subdivisions or subject matters, explain their main differences as to commercial appeals.
The Philippines has a uniform judicial system. Geographical subdivisions are only of consideration for purposes of determining the venue of civil and commercial cases. Generally, a regional trial court will have appellate jurisdiction over civil and commercial cases decided by municipal or metropolitan trial courts within its territorial jurisdiction. The Court of Appeals and Supreme Court have national appellate jurisdiction.
Bringing an appeal
What are the deadlines for filing an appeal in a commercial matter?
In civil and commercial cases, the appeal period is generally within 15 days from notice (ie, official receipt of service) of the award, judgment, final order or resolution to be appealed, or from the date of its last publication, if publication is required by law for its effectivity, or from notice of the denial of a motion for new trial or reconsideration duly filed with the court of origin in accordance with the governing law of the court or agency. Certain modes of appeal, however, allow for longer periods, such as petitions for certiorari to appeal interlocutory orders (ie, orders that do not finally resolve or dispose of a case) under Rule 65 of the Rules of Court, which shall be 60 days from notice of the order or resolution.
What are the key steps a litigant must take to commence an appeal?
For ordinary civil or commercial appeals of final judgments or decisions of municipal or metropolitan trial courts to the regional trial court and final judgments and decisions of regional trial courts to the Court of Appeals, an appeal is taken by:
- filing a notice of appeal with the court of origin that rendered the judgment or final order appealed from within the applicable appeal period (generally, 15 days from notice of the judgment or decision);
- paying, within the same period, to the clerk of said court the corresponding docket or appeal and other lawful fees; and
- furnishing the adverse party with a copy of the notice of appeal and proof of payment of the appeal or docket fee.
For further appeals from decisions or judgments of the Court of Appeals, the anti-graft court, the Court of Tax Appeals, the regional trial court or other courts to the Supreme Court, an appeal is made by:
- filing a verified petition for review on certiorari with the Supreme Court within 15 days from notice of the decision or judgment;
- paying, within the same period, to the clerk of court of the Supreme Court the applicable appeal or docket fee; and
- furnishing the lower court concerned and the adverse or opposing party of a copy of the appellate petition. Appellate petitions to the Supreme Court also provide for certain formal requirements that must be complied with.
For interlocutory appeals to the Court of Appeals or Supreme Court, an appeal is taken by:
- filing a verified petition, accompanied by a certified true copy of the judgment, order or resolution subject thereof, copies of all pleadings and documents relevant and pertinent thereto and a sworn certification of non-forum shopping;
- paying the corresponding docket and other lawful fees; and
- furnishing the court of origin and the adverse party with a copy of the petition.
How is the documentation for appeals prepared?
For ordinary appeals, the clerk of the trial court transmits to the appellate court the original record or the approved record on appeal within 30 days from the perfection of the appeal, together with the proof of payment of the appellate court docket and other lawful fees, a certified true copy of the minutes of the proceedings, the order of approval, the certificate of correctness, the original documentary evidence referred to therein, the original and three copies of the transcripts. For interlocutory appeals, the parties are required to attach certified true copies of the decisions or orders being appealed from, and in certain instances, even certified true copies of material records of the case.
Right of appeal
Discretion to grant permission to appeal
In commercial matters, may litigants appeal by right or is appellate review discretionary?
Under Philippine law, an appeal may either be a matter of right or discretionary. An appeal as a matter of right, which refers to the right to seek the review by a superior court of the judgment rendered by the trial court, exists after the trial in the first instance (Heirs of Arturo Garcia v Municipality of Iba, G R No. 162217, 22 July 2015). Hence, a party to a case that originates from municipal trial courts, metropolitan trial courts or municipal circuit trial courts may appeal as a matter of right to the regional trial courts, and a party to a case that originates from a regional trial court may appeal as a matter of right to the Court of Appeals.
In contrast, a discretionary appeal may be taken from the decision or final order rendered by a court in the exercise of its primary appellate jurisdiction, may be taken to the Supreme Court or may be disallowed by the superior court in its discretion (Heirs of Arturo Garcia v Municipality of Iba, G R No. 162217, 22 July 2015). This would refer to a further appeal from the regional trial court, exercising its appellate jurisdiction, to the Court of Appeals or a further appeal to the Supreme Court.
Judgments subject to appeal
Can litigants appeal any ruling from a trial court, or are they limited to appealing only final judgments?
Generally, only final judgments or orders of a court of law or quasi-judicial body are appealable, or those judgments and orders that leave nothing more for the court or quasi-judicial body to be done.
Interlocutory orders are not appealable until after the judgment’s completion on the merits. However, an interlocutory order may be brought up for review through a special civil action for certiorari if the interlocutory order was rendered without or in excess of jurisdiction or with grave abuse of discretion (Banez, Jr v Concepcion, G R No. 159508, 29 August 2012).
Security and interlocutory matters
Security to appeal
In a typical commercial dispute, must a litigant post a bond or provide security to appeal a trial court decision?
There is no requirement of an appeal bond. An appellant, however, must pay docket and other lawful fees as a jurisdictional requirement.
For indigent litigants, a party may be authorised to litigate his or her action, claim or defence as an indigent if the court, upon an ex parte application and hearing, is satisfied that the party is one who has no money or property sufficient and available for food, shelter and basic necessities for him or herself and his or her family. Such authority shall include an exemption from payment of docket and other lawful fees, and of transcripts of stenographic notes, which the court may order to be supplied.
However, should a litigant include an application for provisional remedy, in proper cases, a bond must be posted in the amount fixed by the court.
Are there special provisions for interlocutory appeals?
As discussed above, the appellate remedy from an interlocutory order is not an appeal in the ordinary sense but a special civil action for certiorari, provided that the interlocutory order is rendered without or in excess of jurisdiction or with grave abuse of discretion.
Injunctions and stays
Are there special rules relating to injunctions or stays, whether entered in the trial court or on appeal?
Yes. The Philippines has special rules covering injunction, both as a provisional remedy and as a main relief. An injunction may be allowed provided the following requisites are present, which must be alleged in an application made under oath:
- the existence of a right to be protected; and
- the facts against which the injunction is to be directed are violative of the said right (Republic of the Philippines v Cortez, Sr, G R No. 197472, 7 September 2015).
Also, a bond is usually required before the issuance of the injunctive writ. As a provisional remedy, an injunction may be applied at any stage of the proceedings prior to the judgment or final order.
Scope and effect of appellate proceedings
Effect of filing an appeal
If a litigant files an appeal in a commercial dispute, does it stay enforcement of the trial court judgment?
Yes. Filing an appeal stays the enforcement of a trial court judgment. The final judgment or decision of the trial court only becomes final and executory when no motion for reconsideration is filed with the court of origin or no appeal has been filed or perfected or after an appeal duly filed is decided with finality.
On the other hand, interlocutory orders are immediately enforceable and cannot be stayed by a petition for certiorari unless a preliminary injunction is sought to stay the order. However, there are judgments or decisions from administrative or quasi-judicial agencies that are immediately executory unless execution is restrained in the meantime by the appellate court.
Scope of appeal
On an appeal from a commercial dispute, may the first-level appellate court consider the facts and law anew, or is its power to review limited?
Generally, first-level appellate courts have the power to consider the facts and law de novo. However, when the appeal reaches the Supreme Court, review is generally limited to questions of law as it is not a trier of facts (Far Eastern Surety and Insurance Co Inc v People, G R No. 170618, 20 November 2013). But this rule is subject to certain exceptions, as provided in jurisprudence, taking into account the attendant circumstances (Spouses Sy v China Banking Corporation, G R No. 215954, 1 August 2016).
If a party is dissatisfied with the outcome of the first-level appeal, is further appeal possible?
Yes, there are multiple levels of appellate review. The Philippines observes the principle of judicial hierarchy and such hierarchy is determinative of the venue of appeals. However, when it reaches the Supreme Court, as mentioned above, the appeal becomes discretionary.
Duration of appellate proceedings
How long do appeals typically take from application to appeal to a final decision?
There is no expected or estimated timeline because period varies from case to case. However, based on experience, appellate proceedings usually take from one to three years from the date of filing of the first appellate pleading to when the appeal is either decided or deemed submitted for decision, depending on the complexity of the case, among other factors.
Submissions and evidence
What is the briefing and argument process like in a typical commercial appeal?
Commercial appeals are generally decided on the basis of the evidence adduced and pleadings filed by the parties at the court of first instance. The appellate pleadings would usually consist of the brief or initiatory petition by the appellant; the brief or comment on the initiatory petition filed by the appellee; and other pleadings or submissions that the appellate court may allow or require, such as memoranda. The Court of Appeals, in certain cases, may also conduct hearings and receive evidence. The Court of Appeals and the Supreme Court may additionally hear the parties in oral argument on the merits of a case, or on any material incident in connection therewith.
Are appeals limited to the evidentiary record that was before the trial court, or can new evidence be introduced on appeal?
Generally, evidence introduced for the first time on appeal is not entertained by the appellate courts, since it is well established in Philippine jurisprudence that points of law, theories, issues and arguments not brought to the attention of the trial court will not be and ought not to be considered by a reviewing court, as these cannot be raised for the first time on appeal (Calanasan v Spouses Dolorito, G R No. 171937, 25 November 2013).
There are exceptions to the rule that no question may be raised for the first time on appeal. The issue of lack of jurisdiction over the subject matter may be raised at any stage of the proceedings and may be considered by the reviewing court. The said court may also consider an issue not properly raised during trial when there is plain error. Likewise, it may entertain such arguments when there are jurisprudential developments affecting the issues or when the issues raised present a matter of public policy (Del Rosario v Bonga, G R No. 136308, 23 January 2001).
New evidence of wrongdoing
If litigants uncover new evidence of wrongdoing that they believe altered the outcome of a trial court judgment, can they introduce this evidence on appeal?
Under Philippine law, fraud, accident, mistake or excusable negligence that ordinary prudence could not have guarded against and by reason of which the aggrieved party has probably been impaired in his or her rights; or newly discovered evidence that he or she could not, with reasonable diligence, have discovered and produced at the trial and that if presented would probably alter the result, are not raised on appeal but are instead causes to move the trial court to set aside the judgment or final order and grant a new trial.
New legal arguments
May parties raise new legal arguments on appeal?
As a rule, no question will be entertained on appeal unless it has been raised in the court below. Basic considerations of due process impel this rule. Stated differently, issues of fact and arguments not adequately brought to the attention of the lower courts will not be considered by the reviewing courts as they cannot be raised for the first time on appeal (Del Rosario v Bonga, G R No. 136308. 23 January 2001). There are, however, recognised exceptions to this rule (Logronio v Taleseo, G R No. 134602, 6 August 1999).
Costs, settlement and funding
What are the rules regarding attorneys’ fees and costs on appeal?
There are two commonly accepted concepts of attorney’s fees, ordinary and extraordinary. In its ordinary concept, an attorney’s fee is the reasonable compensation paid to a lawyer by his or her client for the legal services he or she has rendered to the latter; while in its extraordinary concept, attorney’s fees are deemed indemnity for damages ordered by the court to be paid by the losing party in litigation. The instances where these may be awarded are those enumerated in article 2208 of the Civil Code (Alva v High Capacity Security Force, Inc, G R No. 203328, 8 November 2017). An appellate court may affirm, modify or set aside a trial court’s award of extraordinary attorney’s fees in the process of appellate review.
Meanwhile, cost shall be awarded in favour of the prevailing party as a matter of course, but the court shall have power, for special reasons, to adjudge that either party shall pay the costs of an action or that the same be divided, as may be equitable. Likewise, where an action or appeal is found to be frivolous, double or treble cost may be imposed on the plaintiff or appellant, which shall be paid by his or her attorney, if so ordered by the court. Again, this imposition may be affirmed, modified or set aside on appeal.
Settlement of first instance judgment after appeal lodged
Can parties enter into a settlement agreement to vacate the trial court judgment after an appeal has been taken?
Yes. Parties are allowed to enter into compromise or settlement agreements that cover cases pending trial, on appeal or even those that have already been finally decided. There is no time limitation as to when a compromise or settlement agreement may be entered into (Magbanua v Uy, G R No. 161003. 6 May 2005).
Limits on settlement after commencement of appeal
Are there any limits on settlement once an appeal has been taken?
The filing of an appeal does not limit the parties’ ability to enter into compromise or settlement agreements as long as such agreements are not contrary to law, morals, good customs and public policy. Article 2935 of the Civil Code of the Philippines, however, provides that no compromise upon the following questions shall be valid:
- the civil status of persons;
- validity of a marriage or a legal separation;
- any ground for legal separation;
- future support;
- jurisdiction of courts; or
- future legitime.
May third parties fund appeals?
There are no specific rules in this jurisdiction that govern third-party litigation funders and a litigant would ordinarily be free to source his or her litigation funds. However, an agreement whereby an attorney agrees to pay expenses of proceedings to enforce the client’s rights is champertous (Roxas v Republic Real Estate Corp, G R No. 208205, 1 June 2016). A champertous contract is considered against public policy as it violates the fiduciary relations between the lawyer and his or her client, whose weakness or disadvantage may be exploited by the former (Nocom v Camerino, G R No. 182984, 10 February 2009).
Disclosure of litigation funding
If litigation funding is permitted in an appeal, must funding sources be disclosed to the court or other parties to the litigation?
There are no express rules covering third-party litigation funders in this jurisdiction (see question 25).
Judgments, relief and non-parties
Must appellate courts in your country write decisions explaining their rulings? Can the courts designate the precedential effect of their decisions?
Yes. The Philippine Constitution requires that no decision shall be rendered by any court without expressing therein clearly and distinctly the facts and the law on which it is based. Further, the Rules of Court also emphasise that every decision or final resolution of the court in appealed cases shall clearly and distinctly state the findings of fact and the conclusions of law on which it is based, which may be contained in the decision or final resolution itself, or adopted from those set forth in the decision, order or resolution appealed from.
Only decisions of the Supreme Court are considered as judicial precedents to be followed in subsequent cases by all courts in the land, following the principle of stare decisis.
Will the appellate courts in your country consider submissions from non-parties?
Yes. The Rules of Court provide that experienced and impartial attorneys may be invited by the Supreme Court to appear as amici curiae to help in the disposition of issues submitted to it.
What are the ordinary forms of relief that can be rendered by an appellate court in a civil dispute?
The appellate court may affirm, reverse or modify the judgment or final order appealed from and may direct a new trial or further proceedings to be had. Reliefs may include the award of damages, attorney’s fees, grant of provisional remedies and other relief.