WIPO Lex

SECOND DIVISION

[G.R. No. 221732. August 23, 2017.]

FERNANDO U. JUAN, petitioner, vs. ROBERTO U. JUAN (substituted by his son JEFFREY C. JUAN) and LAUNDROMATIC CORPORATION, respondents.

DECISION

PERALTA, J p:

For this Court's resolution is the Petition for Review on Certiorari under Rule 45 of the Rules of Court dated January 25, 2016, of petitioner Fernando U. Juan that seeks to reverse and set aside the Decision [1] dated May 7, 2015 and Resolution [2] dated December 4, 2015 of the Court of Appeals (CA) dismissing his appeal for failure to comply with the requirements of Section 13, Rule 44 and Section 1, Rule 50 of the Rules of Court.

The facts follow.

Respondent Roberto U. Juan claimed that he began using the name and mark "Lavandera Ko" in his laundry business on July 4, 1994. He then opened his laundry store at No. 119 Alfaro St., Salcedo St., Makati City in 1995. Thereafter, on March 17, 1997, the National Library issued to him a certificate of copyright over said name and mark. Over the years, the laundry business expanded with numerous franchise outlets in Metro Manila and other provinces. Respondent Roberto then formed a corporation to handle the said business, hence, Laundromatic Corporation (Laundromatic) was incorporated in 1997, while "Lavandera Ko" was registered as a business name on November 13, 1998 with the Department of Trade and Industry (DTI). Thereafter, respondent Roberto discovered that his brother, petitioner Fernando was able to register the name and mark "Lavandera Ko" with the Intellectual Property Office (IPO) on October 18, 2001, the registration of which was filed on June 5, 1995. Respondent Roberto also alleged that a certain Juliano Nacino (Juliano) had been writing the franchisees of the former threatening them with criminal and civil cases if they did not stop using the mark and name "Lavandera Ko." It was found out by respondent Roberto that petitioner Fernando had been selling his own franchises.

Thus, respondent Roberto filed a petition for injunction, unfair competition, infringement of copyright, cancellation of trademark and name with/and prayer for TRO and Preliminary Injunction with the Regional Trial Court (RTC) and the case was raffled off at Branch 149, Makati City. The RTC issued a writ of preliminary injunction against petitioner Fernando in Order dated June 10, 2004. On July 21, 2008, due to the death of respondent Roberto, the latter was substituted by his son, Christian Juan (Christian). Pre-trial conference was concluded on July 13, 2010 and after the presentation of evidence of both parties, the RTC rendered a Resolution dated September 23, 2013, dismissing the petition and ruling that neither of the parties had a right to the exclusive use or appropriation of the mark "Lavandera Ko" because the same was the original mark and work of a certain Santiago S. Suarez (Santiago). According to the RTC, the mark in question was created by Suarez in 1942 in his musical composition called, "Lavandera Ko" and both parties of the present case failed to prove that they were the originators of the same mark. The dispositive portion of the RTC's resolution reads as follows:

WHEREFORE, premises considered, this court finds both the plaintiff-Roberto and defendant-Fernando guilty of making misrepresentations before this court, done under oath, hence, the Amended Petition and the Answer with their money claims prayed for therein are hereby DISMISSED.

Therefore, the Amended Petition and the Answer are hereby DISMISSED for no cause of action, hence, the prayer for the issuance of a writ of injunction is hereby DENIED for utter lack of merit; and the Writ of Preliminary Injunction issued on June 10, 2004 is hereby LIFTED AND SET ASIDE.

Finally, the National Library is hereby ordered to cancel the Certificate of Registration issued to Roberto U. Juan on March 17, 1997 over the word "Lavandera Ko," under certificate no. 97-362. Moreover, the Intellectual Property Office is also ordered to cancel Certificate of Registration No. 4-1995-102749, Serial No. 100556, issued on October 18, 2001, covering the work LAVANDERA KO AND DESIGN, in favor of Fernando U. Juan.

The two aforesaid government agencies are hereby requested to furnish this Court of the copy of their cancellation.

Cost de oficio.

SO ORDERED. [3]

Herein petitioner elevated the case to the CA through a notice of appeal. In his appeal, petitioner contended that a mark is different from a copyright and not interchangeable. Petitioner Fernando insisted that he is the owner of the service mark in question as he was able to register the same with the IPO pursuant to Section 122 of R.A. No. 8293. Furthermore, petitioner Fernando argued that the RTC erred in giving credence to the article of information it obtained from the internet stating that the Filipino folk song "Lavandera Ko" was a composition of Suarez in 1942 rather than the actual pieces of evidence presented by the parties. As such, according to petitioner, such information acquired by the RTC is hearsay because no one was presented to testify on the veracity of such article.

Respondent Roberto, on the other hand, contended that the appeal should be dismissed outright for raising purely questions of law. He further raised as a ground for the dismissal of the appeal, the failure of the petitioner to cite the page references to the record as required in Section 13, paragraphs (a), (c), (d) and (f) of Rule 44 of the Rules of Court and petitioner's failure to provide a statement of facts. Respondent also argued that assuming that the Appellant's Brief complied with the formal requirements of the Rules of Court, the RTC still did not err in dismissing the petitioner's answer with counterclaim because he cannot be declared as the owner of "Lavandera Ko," since there is prior use of said mark by another person.

The CA, in its Decision dated May 7, 2015, dismissed the petitioner's appeal based on technical grounds, thus:

WHEREFORE, premises considered, the instant appeal is DISMISSED for failure to comply with the requirements of Section 13, Rule 44 and Section 1, Rule 50 of the Rules of Court.

SO ORDERED. [4]

Hence, the present petition after the denial of petitioner Fernando's motion for reconsideration.

Petitioner Fernando raises the following issues:

WHETHER OR NOT THE DISMISSAL OF THE APPEAL BY THE COURT OF APPEALS ON PURELY TECHNICAL GROUNDS WAS PROPER CONSIDERING THAT THE CASE BEFORE IT CAN BE RESOLVED BASED ON THE BRIEF ITSELF.

WHETHER OR NOT A MARK IS THE SAME AS A COPYRIGHT.

WHETHER OR NOT FERNANDO U. JUAN IS THE OWNER OF THE MARK "LAVANDERA KO."

WHETHER OR NOT AN INTERNET ARTICLE IS SUPERIOR THAN ACTUAL EVIDENCE SUBMITTED BY THE PARTIES. [5]

According to petitioner Fernando, the CA should have considered that the rules are there to promote and not to defeat justice, hence, it should have decided the case based on the merits and not dismiss the same based on a mere technicality. The rest of the issues are similar to those that were raised in petitioner's appeal with the CA.

In his Comment [6] dated April 22, 2016, respondent Roberto insists that the CA did not commit an error in dismissing the appeal considering that the formal requirements violated by the petitioner in the Appellant's Brief are basic, thus, inexcusable and that petitioner did not proffer any valid or substantive reason for his non-compliance with the rules. He further argues that there was prior use of the mark "Lavandera Ko" by another, hence, petitioner cannot be declared the owner of the said mark despite his subsequent registration with the IPO.

The petition is meritorious.

Rules of procedure must be used to achieve speedy and efficient administration of justice and not derail it. [7] Technicality should not be allowed to stand in the way of equitably and completely resolving the rights and obligations of the parties. [8] It is, [thus] settled that liberal construction of the rules may be invoked in situations where there may be some excusable formal deficiency or error in a pleading, provided that the same does not subvert the essence of the proceeding and it at least connotes a reasonable attempt at compliance with the rules. [9] In Aguam v. CA, [10] this Court ruled that:

x x x Technicalities, however, must be avoided. The law abhors technicalities that impede the cause of justice. The court's primary duty is to render or dispense justice. "A litigation is not a game of technicalities." "Law suits, unlike duels, are not to be won by a rapier's thrust. Technicality, when it deserts its proper office as an aid to justice and becomes its great hindrance and chief enemy, deserves scant consideration from courts." Litigations must be decided on their merits and not on technicality. Every party litigant must be afforded the amplest opportunity for the proper and just determination of his cause, free from the unacceptable plea of technicalities. Thus, dismissal of appeals purely on technical grounds is frowned upon where the policy of the court is to encourage hearings of appeals on their merits and the rules of procedure ought not to be applied in a very rigid, technical sense; rules of procedure are used only to help secure, not override substantial justice. It is a far better and more prudent course of action for the court to excuse a technical lapse and afford the parties a review of the case on appeal to attain the ends of justice rather than dispose of the case on technicality and cause a grave injustice to the parties, giving a false impression of speedy disposal of cases while actually resulting in more delay, if not a miscarriage of justice.

In this case, this Court finds that a liberal construction of the rules is needed due to the novelty of the issues presented. Besides, petitioner had a reasonable attempt at complying with the rules. After all, the ends of justice are better served when cases are determined on the merits, not on mere technicality. [11]

The RTC, in dismissing the petition, ruled that neither of the parties are entitled to use the trade name "Lavandera Ko" because the copyright of "Lavandera Ko", a song composed in 1942 by Santiago S. Suarez belongs to the latter. The following are the RTC's reasons for such ruling:

The resolution of this Court — NO ONE OF THE HEREIN PARTIES HAS THE RIGHT TO USE AND ENJOY "LAVANDERA KO"!

Based on the date taken from the internet — References: CCP encyclopedia of Philippine art, vol. 6 http://www.himig.com.ph (http://kahimyang.info / kauswagan/articles/1420/today-in-philippine-history this information was gathered: "In 1948, Cecil Lloyd established the first Filipino owned record company, the Philippine Recording System, which featured his rendition of Filipino folk songs among them the "Lavandera ko" (1942) which is a composition of Santiago S. Suarez." Thus, the herein parties had made misrepresentation before this court, to say the least, when they declared that they had coined and created the subject mark and name. How can the herein parties have coined and created the subject mark and work when these parties were not yet born; when the subject mark and work had been created and used in 1942.

The heirs of Mr. Santiago S. Suarez are the rightful owners of subject mark and work — "Lavandera ko".

Therefore, the writ of injunction issued in the instant case was quite not proper, hence the same shall be lifted and revoked. This is in consonance with the finding of this court of the origin of the subject mark and work, e.g., a music composition of one Santiago S. Suarez in 1942.

Moreover, Section 171.1 of R.A. 8293 states: "Author" is the natural person who has created the work." And, Section 172.1 of R.A. No. 8293 provides: Literary and artistic works, hereinafter referred to as "works", are original intellectual creations in the literary and artistic domain protected from the moment of their creation and shall include in particular:

(d) Letters;

(f) Musical compositions, with or without words;"

Thus, the subject mark and work was created by Mr. Santiago S. Suarez, hence, the subject mark and work belong to him, alone.

The herein parties are just false claimants, done under oath before this court (paragraph 4 of Roberto's affidavit, Exhibit A TRO, page 241, Vol. I and paragraph 2 of Fernando's affidavit, Exhibit 26 TRO, page 354, Vol. I), of the original work of Mr. Santiago S. Suarez created in 1942.

Furthermore, Section 21 of R.A. 8293 declares: "Patentable Inventions — any technical solution of a problem in any field of human activity which is new, involves an inventive step and is industrially applicable shall be patentable. It may be, or may relate to, a product, or process, or an improvement of any of the foregoing." Thus, the herein subject mark and work can never be patented for the simple reason that it is not an invention. It is a title of a music composition originated from the mind of Mr. Santiago S. Suarez in 1942.

Thus, the proper and appropriate jurisprudence applicable to this instant case is the wisdom of the High Court in the case of Pearl & Dean (Phil.), Incorporation v. Shoemart, Incorporated (G.R. No. 148222, August 15, 2003), the Supreme Court ruled: "The scope of a copyright is confined to literary and artistic works which are original intellectual creations in the literary and artistic domain protected from the moment of their creation." The Supreme Court concluded: "The description of the art in a book, though entitled to the benefit of copyright, lays no foundation for an exclusive claim to the art itself. The object of the one is explanation; the object of the other is use. The former may be secured by copyright. The latter can only be secured, if it can be secured at all, by letters patent." (Pearl & Dean v. Shoemart, supra, citing the case of Baker v. Selden, 101 U.S. 99; 1879 U.S. Lexis 1888; 25 L. Ed. 841; 11 Otto 99, October, 1879 Term).

It is noted that the subject matter of Exhibit "5" (Annex 5) Of Fernando (IPO certificate of registration) and Exhibit B of Roberto (Certificate of Copyright Registration) could not be considered as a literary and artistic work emanating from the creative mind and/or hand of the herein parties for the simple reason that the subject work was a creation of the mind of Mr. Santiago S. Suarez in 1942. Thus, neither of the herein parties has an exclusive right over the subject work "Lavandera Ko" for the simple reason that herein parties were not the maker, creator or the original one who conceptualized it. Section 171.1 defines the author as the natural person who has created the work. (R.A. No. 8293). Therefore, it can be said here, then and now, that said registrations of the word "Lavandera Ko" by the herein parties cannot be protected by the law, Republic Act No. 8293. Section 172.2 (R.A. No. 8293) is quite crystal clear on this point, it declares: "Works are protected by the sole fact of their creation, irrespective of their mode or form of expressions, as well as of their content, quality and purpose." Herein parties were not the creators of the subject word. It was a creation of Santiago S. Suarez in 1942.

Finally, in the case of Wilson Ong Ching Kian Chuan v. Court of Appeals and Lorenzo Tan (G.R. No. 130360, August 15, 2001), the Supreme Court ruled: "A person to be entitled to a copyright must be the original creator of the work. He must have created it by his own skill, labor and judgment without directly copying or evasively imitating the work of another." Again, herein parties, both, miserably failed to prove and establish on how they have created this alleged work before registering it with the National Library and the Intellectual Property Office, hence their claim of ownership of the word "Lavandera Ko" is not conclusive or herein parties are both great pretenders and imitators. Therefore, it is hereby declared that registration with the IPO by Fernando is hereby cancelled, for one and many others stated herein, because of the admission of Fernando that he coined the name from the lyrics of a song popularized in the 1950's by singer Ruben Tagalog. Admission is admissible without need of evidence. (Section 4, Rule 129 of the Revised Rules of Court).

Considering that herein parties had made misrepresentations before this court, hence, both the herein parties came to this court with unclean hands. Thus, no damage could be awarded to anyone of the herein parties. [12]

The above ruling is erroneous as it confused trade or business name with copyright.

The law on trademarks, service marks and trade names are found under Part III of Republic Act (R.A.) No. 8293, or the Intellectual Code of the Philippines, while Part IV of the same law governs copyrights.

"Lavandera Ko," the mark in question in this case is being used as a trade name or specifically, a service name since the business in which it pertains involves the rendering of laundry services. Under Section 121.1 of R.A. No. 8293, "mark" is defined as any visible sign capable of distinguishing the goods (trademark) or services (service mark) of an enterprise and shall include a stamped or marked container of goods. As such, the basic contention of the parties is, who has the better right to use "Lavandera Ko" as a service name because Section 165.2 [13] of the said law, guarantees the protection of trade names and business names even prior to or without registration, against any unlawful act committed by third parties. A cause of action arises when the subsequent use of any third party of such trade name or business name would likely mislead the public as such act is considered unlawful. Hence, the RTC erred in denying the parties the proper determination as to who has the ultimate right to use the said trade name by ruling that neither of them has the right or a cause of action since "Lavandera Ko" is protected by a copyright.

By their very definitions, copyright and trade or service name are different. Copyright is the right of literary property as recognized and sanctioned by positive law. [14] An intangible, incorporeal right granted by statute to the author or originator of certain literary or artistic productions, whereby he is invested, for a limited period, with the sole and exclusive privilege of multiplying copies of the same and publishing and selling them. [15] Trade name, on the other hand, is any designation which (a) is adopted and used by person to denominate goods which he markets, or services which he renders, or business which he conducts, or has come to be so used by other, and (b) through its association with such goods, services or business, has acquired a special significance as the name thereof, and (c) the use of which for the purpose stated in (a) is prohibited neither by legislative enactment nor by otherwise defined public policy. [16]

Section 172.1 of R.A. 8293 enumerates the following original intellectual creations in the literary and artistic domain that are protected from the moment of their creation, thus:

172.1 Literary and artistic works, hereinafter referred to as "works", are original intellectual creations in the literary and artistic domain protected from the moment of their creation and shall include in particular:

(a) Books, pamphlets, articles and other writings;

(b) Periodicals and newspapers;

(c) Lectures, sermons, addresses, dissertations prepared for oral delivery, whether or not reduced in writing or other material form;

(d) Letters;

(e) Dramatic or dramatico-musical compositions; choreographic works or entertainment in dumb shows;

(f) Musical compositions, with or without words;

(g) Works of drawing, painting, architecture, sculpture, engraving, lithography or other works of art; models or designs for works of art;

(h) Original ornamental designs or models for articles of manufacture, whether or not registrable as an industrial design, and other works of applied art;

(i) Illustrations, maps, plans, sketches, charts and three-dimensional works relative to geography, topography, architecture or science;

(j) Drawings or plastic works of a scientific or technical character;

(k) Photographic works including works produced by a process analogous to photography; lantern slides;

(l) Audiovisual works and cinematographic works and works produced by a process analogous to cinematography or any process for making audio-visual recordings;

(m) Pictorial illustrations and advertisements;

(n) Computer programs; and

(o) Other literary, scholarly, scientific and artistic works.

As such, "Lavandera Ko," being a musical composition with words is protected under the copyright law (Part IV, R.A. No. 8293) and not under the trademarks, service marks and trade names law (Part III, R.A. No. 8293).

In connection therewith, the RTC's basis or source, an article appearing in a website, [17] in ruling that the song entitled "Lavandera Ko" is protected by a copyright, cannot be considered a subject of judicial notice that does not need further authentication or verification. Judicial notice is the cognizance of certain facts that judges may properly take and act on without proof because these facts are already known to them. [18] Put differently, it is the assumption by a court of a fact without need of further traditional evidentiary support. The principle is based on convenience and expediency in securing and introducing evidence on matters which are not ordinarily capable of dispute and are not bona fide disputed. [19] In Spouses Latip v. Chua, [20] this Court expounded on the nature of judicial notice, thus:

Sections 1 and 2 of Rule 129 of the Rules of Court declare when the taking of judicial notice is mandatory or discretionary on the courts, thus:

SECTION 1. Judicial notice, when mandatory. — A court shall take judicial notice, without the introduction of evidence, of the existence and territorial extent of states, their political history, forms of government and symbols of nationality, the law of nations, the admiralty and maritime courts of the world and their seals, the political constitution and history of the Philippines, the official acts of the legislative, executive and judicial departments of the Philippines, the laws of nature, the measure of time, and the geographical divisions.

SEC. 2. Judicial notice, when discretionary. — A court may take judicial notice of matters which are of public knowledge, or are capable of unquestionable demonstration or ought to be known to judges because of their judicial functions.

On this point, State Prosecutors v. Muro is instructive:

I. The doctrine of judicial notice rests on the wisdom and discretion of the courts. The power to take judicial notice is to be exercised by courts with caution; care must be taken that the requisite notoriety exists; and every reasonable doubt on the subject should be promptly resolved in the negative.

To say that a court will take judicial notice of a fact is merely another way of saying that the usual form of evidence will be dispensed with if knowledge of the fact can be otherwise acquired. This is because the court assumes that the matter is so notorious that it will not be disputed. But judicial notice is not judicial knowledge. The mere personal knowledge of the judge is not the judicial knowledge of the court, and he is not authorized to make his individual knowledge of a fact, not generally or professionally known, the basis of his action. Judicial cognizance is taken only of those matters which are "commonly" known.

We reiterated the requisite of notoriety for the taking of judicial notice in the recent case of Expertravel & Tours, Inc. v. Court of Appeals, which cited State Prosecutors:

Generally speaking, matters of judicial notice have three material requisites: (1) the matter must be one of common and general knowledge; (2) it must be well and authoritatively settled and not doubtful or uncertain; and (3) it must be known to be within the limits of the jurisdiction of the court. The principal guide in determining what facts may be assumed to be judicially known is that of notoriety. Hence, it can be said that judicial notice is limited to facts evidenced by public records and facts of general notoriety. Moreover, a judicially noticed fact must be one not subject to a reasonable dispute in that it is either: (1) generally known within the territorial jurisdiction of the trial court; or (2) capable of accurate and ready determination by resorting to sources whose accuracy cannot reasonably be questionable.

Things of "common knowledge," of which courts take judicial notice, may be matters coming to the knowledge of men generally in the course of the ordinary experiences of life, or they may be matters which are generally accepted by mankind as true and are capable of ready and unquestioned demonstration. Thus, facts which are universally known, and which may be found in encyclopedias, dictionaries or other publications, are judicially noticed, provided, they are such of universal notoriety and so generally understood that they may be regarded as forming part of the common knowledge of every person. As the common knowledge of man ranges far and wide, a wide variety of particular facts have been judicially noticed as being matters of common knowledge. But a court cannot take judicial notice of any fact which, in part, is dependent on the existence or non-existence of a fact of which the court has no constructive knowledge.

The article in the website cited by the RTC patently lacks a requisite for it to be of judicial notice to the court because such article is not well and authoritatively settled and is doubtful or uncertain. It must be remembered that some articles appearing in the internet or on websites are easily edited and their sources are unverifiable, thus, sole reliance on those articles is greatly discouraged.

Considering, therefore, the above premise, this Court deems it proper to remand the case to the RTC for its proper disposition since this Court cannot, based on the records and some of the issues raised by both parties such as the cancellation of petitioner's certificate of registration issued by the Intellectual Property Office, make a factual determination as to who has the better right to use the trade/business/service name, "Lavandera Ko."

WHEREFORE, the Petition for Review on Certiorari under Rule 45 of the Rules of Court dated January 25, 2016, of petitioner Fernando U. Juan is GRANTED. Consequently, the Decision dated May 7, 2015 and Resolution dated December 4, 2015 of the Court of Appeals are REVERSED and SET ASIDE. This Court, however, ORDERS the REMAND of this case to the RTC for its prompt disposition.

SO ORDERED.

Carpio, Perlas-Bernabe and Reyes, Jr., JJ., concur.

Caguioa, [*] J., is on leave.

Footnotes

* On leave.

1. Penned by Associate Justice Mariflor P. Punzalan Castillo, with the concurrence of Associate Justices Florito S. Macalino and Melchor Quirino C. Sadang; rollo, pp. 37-45.

2. Id. at 47-48.

3. Id. at 60-61.

4. Id. at 45.

5. Id. at 15.

6. Id. at 90-106.

7. Lynman Bacolor, et al. v. VL Makabali Memorial Hospital, Inc., et al., G.R. No. 204325, April 18, 2016.

8. Zacarias Cometa, et al. v. CA, et al., 404 Phil. 107, 120 (2001), citing Casa Filipina Realty Corporation v. Office of the President, 311 Phil. 170, 181 (1995), citing Rapid Manpower Consultants, Inc. v. NLRC, 268 Phil. 815, 821 (1990).

9. Pagadora v. Ilao, 678 Phil. 208, 222 (2011), citing Mediserv, Inc. v. Court of Appeals [n], 631 Phil. 282, 295 (2010).

10. 388 Phil. 587, 592-593 (2000). (Citations omitted).

11. Ateneo de Naga University v. Manalo, 497 Phil. 635, 646 (2005).

12. Rollo, pp. 58-60.

13. 165.2. (a) Notwithstanding any laws or regulations providing for any obligation to register trade names, such names shall be protected, even prior to or without registration, against any unlawful act committed by third parties.

(b) In particular, any subsequent use of the trade name by a third party, whether as a trade name or a mark or collective mark, or any such use of a similar trade name or mark, likely to mislead the public, shall be deemed unlawful.

14. Black's Law Dictionary, Fifth Edition, (1979), p. 304.

15. Id.

16. Id. at 1339, citing Walters v. Building Maintenance Service, Inc., Tex.Civ.App., 291 S.W.2d 377, 382.

17. http//www.himig.com.ph (http://kahimyang.info/kauswagan/articles/1420/today-in-philippine-history

18. Republic v. Sandiganbayan, et al., 678 Phil. 358, 425 (2011), citing Ricardo J. Francisco, 7 The Revised Rules of Court in the Philippines, Evidence, Part I, 1997 ed., p. 69.

19. Id., citing Oscar M. Herrera, 5 Remedial Law, 1999, p. 72.

20. 619 Phil. 155, 164-166 (2009). (Citations omitted)

n Note from the Publisher: Written as "Mediserve, Inc. v. Court of Appeals" in the official document.

Филиппины

PH046-j

Fernando U. Juan vs. Roberto U. Juan (substituted by his son Jeffrey C. Juan) and Laundromatic Corporation, G.R. No. 221732. August 23, 2017.