Republic of the Philippines National Capital Judicial Region Regional Trial Court Quezon City Branch 97 D.M.

FERRER and ASSOCIATES CORPORATION, Plaintiff, ersus ! Ci il Case No" Q!#$!%&%'(

UNIVERSITY OF SANTO TOMAS HOSPITAL, INC. and UNIVERSITY OF SANTO TOMAS represented by ts RECTOR REV. FR. ROLANDO V. DELA ROSA, O.P., )efendants" *!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!*

MOTION FOR RECONSIDERATION

P+,-NT-.., by counsel and unto this /onorable Court, 0ost respectfully 0o es for reconsideration of the 1rder of this Court dated ,ugust 2, &##$, a copy of 3hich, 3as recei ed by the undersigned la3 fir0 on ,ugust 44, &##$ and states, iz5 PR6.,T1R7 The disputed 1rder dis0isses the co0plaint against 8ni ersity of 9anto To0as on t3o :&; grounds5 a; That the co0plaint states no cause of action as against 89T< and, b; That the clai0 is unenforceable under the 9tatute of .rauds" 1n the first ground, the Court held that there 3as no pri ity of contract bet3een the plaintiff, )"=" .errer and 89T as can be gleaned fro0 the docu0ent appended in the co0plaint" ,n e>cerpt of the 1rder pertaining to the argu0ents of the Court in support of this finding is hereto ?uoted erbati0, iz5

@Guided by this Rule and jurisprudence, this Court, after a closed perusal of the documents submitted in support of the Complaint , cannot consider defendant-movant as a real party in interest in this case. It is clearly noted that the name of defendant-movant UST does not appear in any manner or form in the Project ana!ement "ontract entered into by and bet#een defendant UST$I and the plaintiff, #hich "ontract is the principal subject matter of this case. %i&e#ise does it appear that a representative of defendant-movant UST si!ned or had any participation in the preparation and e'ecution of the same "ontract. An even closer look into the other Complaint attachments #ould reveal that the plaintiff directly dealt #ith defendant UST$I and not #ith defendant-movant UST. Thus defendant-movant UST cannot be a real party in interest in the instant case.A
:/ighlighting, supplied;

"#&

otion (or Reconsideration

The court also obser ed that the 89T and 89T/- ha e separate and distinct personalities and held that the 0ere fact that it appears that there 0ay be interlocBing directors andCor officers does not in the 3ords of the Court @3eaBen the corporate status of both corporations as being separate and distinct fro0 each otherA" The &nd ground relied upon by the court in dis0issing the co0plaint against 89T is the percei ed unenforceability of 89TDs co00it0ent to pay the plaintiff since the assurance 3as not 0ade in 3riting, hence unenforceable under the statute of frauds" Ee hu0bly taBe e>ceptions to the ruling of this Court dis0issing the co0plaint against 89T, hence this 0otion for reconsideration"

AR!UMENTS

Ee sub0it the /onorable Court co00itted serious errors in la3 in dis0issing the co0plaint against 89T on the ground that the co0plaint failed to state a cause of action" The 9upre0e Court, in the long line of decisions, held that5

)*hen the !round for dismissal is that the complaint states no cause of action, such fact can be determined only from the facts alle!ed in the complaint. +Mindanao Realty Corp. vs. Kintanar, et al., L-1 1!", #ovember $%, 1&'"( and from no other +Marabilles vs. )uito, 1%% *hil. '+, -oncato vs. .iason, et al., L"&%&+, .ept. !, 1&/!( and the court cannot consider other matters aliunde +.alvador vs. 0rio, L-"!$!", May "&, 1& %,. This implies that the issue must be passed upon on the basis of the alle!ations assumin! them to be true and the court cannot in-uire into the truth of the alle!ations and declare them to be false, other#ise it #ould be a procedural error and a denieal of due process to the plaintiff. +1entura vs. -ernabe, L-"' '&, April $%, 1& 1, 2aleon vs. 2aleon, et al., L-$%$/%, 0eb. "/, 1& $(. )In determinin! #hether an initiatory pleadin! states a cause of action, )the test is as follo#s. admittin! the truth of the facts alle!ed, can the court render a valid jud!ment in accordance #ith the prayer/0 To be taBen into account are only the 0aterial allegations in the co0plaint " e#trane$%s &a'ts and ' r'%(stan'es $r $t)er (atters a* %nde are n$t '$ns dered. +Sps. ,epeda et a*. -s. C) na .an/ n0 C$rp$rat $n, !.R. N$. 123124, O't$ber 5, 36678

.12

otion (or Reconsideration

, deliberate reading of the disputed 1rder 3ill re eal that the Court relied on the docu0ents appended or anne>ed to the co0plaint" -n fact, the court e en candidly ad0itted that it did rely on the ProFect =anage0ent Contract attached as ,nne> @,A to the Co0plaint" Ee respectfully sub0it the court co00itted serious error in relying on the attach0ents to the Co0plaint instead of e>a0ining the Co0plaint itself" The court, in ad0itting candidly that it based its findings on the contract bet3een the parties in resol ing 3hether the co0plaint states no cause of action, co00itted serious re ersible error, The long line of Furisprudence in interpreting Rule 4% par :g; states that only the allegations in the co0plaint should be considered in resol ing the issue ,N) N1N6 1T/6R" -n other 3ords, it 3as sheer error for the Court to consider other docu0ents apart fro0 the Co0plaint itself" The decisions of the 9upre0e Court are ery e0phatic on this point, that is, only 0aterial allegations in the co0plaint itself should be considered and no other"

The only e>ception to the foregoing rule is pro ided under Rule 9 9ec" 4, i"e", 3here the 0otion to dis0iss on this ground could be filed during the trial in 3hich case the e idence presented 3as to be considered" This scenario is not obtaining in this case because no ans3er and hearing ha e yet been conducted"

Be that as it 0ay, the 9upre0e Court issued a proscription in the case of M * tante -s. Anter$, et a*., L32596, :%ne 16, 1521< that is, that courts should e>ercise ut0ost care and circu0spection in passing upon 0otions to dis0iss based on the aforesaid ground" The test is 3hether assu0ing the allegations of the fact in the co0plaint, a alid Fudg0ent could be rendered in accordance 3ith the prayer in the co0plaint" Ehere the allegations are sufficient but the eracity of the facts are assailed, the 0otion to dis0iss should be denied and the court should order the defendant to ans3er"

9ince this /onorable Court in fact ad0itted that it considered e>traneous 0atters other than the Co0plaint in resol ing the 0otion, 3e hu0bly urge the Court to seriously reconsider its 1rder and re erse its earlier ruling dis0issing the co0plaint against 89T" Clearly, the disputed 1rder is not in accord 3ith the Rules and Furisprudence interpreting Rule 4%"

.13

otion (or Reconsideration

Ee are a3are that in arri ing at its resolution, the Court discussed 0atters such a real party in interest and held the absence of pri ity of contract bet3een plaintiff and defendant 89T" Ee taBe e>ception to the courtDs ruling" 9uffice it to state that in the Co0plaint, plaintiff has alleged the issue of interlocBing directors that 0ay pierce the eil of corporate fiction and thus 0ay hold 89T liable to plaintiff" Plaintiff has liBe3ise alleged that at se eral ti0es and in their conferences 3ith Re .r" Rector Rolando G" )ela Rosa, the latter has assured plaintiff that 89T 3ill pay its indebtedness" This allegation further connects the assu0ed liability of 89T to plaintiff" Ehether this is true or not is a 0atter of e idence and deser es consideration during a full blo3n trial" 9uffice it to state again that these 0atters 3ere alleged in the Co0plaint and since no other 0atter should be considered, 3e hu0bly sub0it the co0plaint stated a cause of action against 89T"

/o3e er, since the 0atter of real party in interest 3as discussed by the /onorable Court, if only to further con ince the court to re erse its ruling and to pro e that indeed 89T and 89T/- are one and the sa0e insofar as their liability to plaintiff is concerned andCor that 89T in fact assu0ed the pay0ent of liability to plaintiff, allo3 us to del e on the follo3ing 0atters"

This /onorable Court opined that 89T and 89T/- are t3o separate corporate entities" Ehile it 0ay be so insofar as their separate 96C licenses are concerned, please consider the follo3ing docu0ents5

a; 9ecretaryDs Certificate dated =ay 9, &##7 !!!! ,nne> @,A hereof b; 9ecretaryDs Certficate dated =ay ', &##7 !!!!!!,nne> @BA hereof c; +etter dated =arch 42, &##7 !!!!!!!! ,nne> @CA hereof

+et us e>a0ine Anne# ;A<, 9ecretaryDs Certificate e>ecuted by Re " .r" -sidro C" ,bano, 1P, secretary of 89T, the highlight of 3hich pro ides that pursuant to the 0eeting held by the 0e0bers of the corporation and the board of trustees, it 3as appro ed to authorize the creation of a separate subsidiary corporation to o3n, 0anaged, super ise, control and operate the 89T /ospital >>>" The i0port of this docu0ent un0istaBably re eals that in reality 3hile 89T/- is a corporation separate and distinct fro0 89T, the latter has the po3er of control to run the affairs and 0anage the for0er"

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otion (or Reconsideration

+et us no3 go to Anne# ;.< another 9ecretaryDs Certificate e>ecuted by .r" ,lbano, the highlight of 3hich pro ides that 89T grants consent to the unconditional assign0ent pre iously 0ade by 89T/- of all the properties as collateral to a Php ' Billion loan being obtained by 89T/- fro0 the )e elop0ent BanB of the Philippines" The bacBdrop of this 9ecretaryDs Certificate 3as pre iously, 89T ceded to 89T/- by 3ay of assign0ent all the 0o able properties so that 89T/- 3ill be able to use this as security for the loan it 3as negotiating 3ith the )PB and other financial banBs" By irtue of this Certificate, 89T ratifies or consents to the act of 89T/- in using the properties of 89T as security for the loan"

.inally, Anne# ;C< 3hich is a letter signed by no less than the ,rchbishop of =anila, Haudencio B" Cardinal Rosales, interceding for and in behalf of the )o0inican fathers of 89T and the 89T/- to the 9ecretary of 9tate of the Gatican City, the endorse0ent of the application for a loan by 89T/-"

,ll of the three docu0ents pro e that it is actually 89T 3hich controls 89T/-" ,nd 3hile the ProFect =anage0ent Contract is 3ith 89T/-, in reality, plaintiff dealt 3ith 89T" Recent e ents ha e in fact pro en that 89T/- had actually passed a Board Resolution shortening its ter0 of e>istence in co0pliance 3ith the 3ishes of 89T as the latter 3ill in fact create another corporation 3hich 3ill 0anage 89T/-" This fact 3as alleged in plaintiffDs co0plaint"

,fter 89T/- passed and appro ed a board resolution shortening its corporate e>istence, the subse?uent e ents confir0ed the role of 89T in dealing 3ith the plaintiff" /ence, plaintiffDs allegation in his Co0plaint that thereafter 89T assured hi0 that it 3ill pay its obligations to hi0" This brings us no3 to the &nd ground 3hich is the percei ed unenforceability of the co00it0ent of the 89T to plaintiff allegedly because of the absence of a 3ritten agree0ent"

PlaintiffDs allegation in his Co0plaint particularly under paragraphs 44, 4&, 4', 42, 4( I 4%, plaintiff detailed his transactions 3ith 89T thru .r" Rector )ela Rosa, 3ho during a series of negotiations 3rote plaintiff a letter stating that they 3ere Fust in the process of erifying and cross!checBing the records regarding the clai0 of plaintiff" The i0plication of the letter is that 89T 3as Fust erifying the clai0 and that it does not in any 3ay repudiates the contract" Thereafter, a conference held on .ebruary 4$, &##$ 3as held and assurances of pay0ent 3ere 0ade to plaintiff, albeit erbal"

.15

otion (or Reconsideration

, 3ritten undertaBing to assu0e obligations by 89T ca0e out fro0 the Garsitarian, its official school publication" -t clearly states therein that 3ith the dissolution of the Furidical personality of 89T/- and the conco0itant resignation of its officers, 89T shall taBe o er and assu0e its obligations" Please refer to ,nne> @)A"

Ee hu0bly taBe e>ception to the findings of the Court that the assu0ed obligation of 89T to plaintiff is unenforceable under the 9tatute of .rauds" ,ssu0ing ar!uendo that there 3as indeed no 3ritten agree0ent, 3e sub0it the present scenario is 3ithin the e>ception on the applicability of the 9tatute of .rauds" Be it re0e0bered that this is already an e>ecutory contract, the contract had been e>ecuted, constructions and inno ations on certain portions of the hospital ha e been installed, partial pay0ents ha e been 0ade" The 9tatute of .rauds do not apply to partially e>ecuted or e>ecuted contracts" /ence, it is not applicable in the instant case"

98==,T-1N

,ll told 3ith all due respect, 3e sub0it it 3as serious re ersible error on the part of the court to dis0iss the case against 89T on the basis of the anne>ed docu0ents to the Co0plaint" -n the light of the honest ad0ission of this Court that it considered e>traneous 0atters, particularly the anne>es of the Co0plaint, in the consideration of the 0otion to dis0iss upon the allegation of failure to state a cause of action in the co0plaint, it behoo es upon this /onorable Court to correct itself" Rule 4% :g; is ery e>plicit on the 0atter, only the allegations in the co0plaint shall be considered by the Court in the resolution of a =otion To )is0iss grounded on failure to state a cause of action"

Ehile 3e are consistent in our position that only allegations in the Co0plaint should be considered, nonetheless in ie3 of the discussion of this Court on real party in interest, 3e are constrained to go along 3ith the discussion, if only to sho3 the relationship bet3een 89T and 89T/-, i"e" that they are one and the sa0e and therefore 89T is indeed a real part in interest" Eith the docu0ents no3 attached to this =otion for Reconsideration, it is our fer ent re?uest that this /onorable Court 3ill reconsider its earlier ruling and re erse itself"

.16

otion (or Reconsideration

-t is true that 89T 3as not a signatory to the ProFect =anage0ent Contract, ho3e er, by its o3n actions of shortening the ter0 of 89T/-Ds e>istence, of responding and conferring 3ith the plaintiff, coupled 3ith its assurances that it 3ill assu0e the obligations of 89T/-, and at its assertions to control and 0anage and e en to establish a subsidiary that 3ill henceforth 0anage and control the operations of the 89T/-, 89T un0istaBably dragged itself into the contro ersy" .airness and Fustice dictate it cannot no3 be allo3ed to hide behind the 0antle of corporate fiction and clai0 it is a separate Furidical entity fro0 89T/-" The reality is 89T/- is controlled by 89T" +astly, 3e sub0it it does not speaB 3ell for catholic educational institution and 3hich holds the distinction of being the oldest learning institution, a uni ersity at that, to turn its bacB fro0 its obligations 3hen it had in fact clearly benefited fro0 it" -ndeed it lea es a ery bad taste in the 0outh" PR,76R E/6R6.1R6 pre0ises considered, it is 0ost respectfully prayed of this /onorable Court that its 1rder dated ,ugust 2, &##$ dis0issing the case against 89T be recalled and re ersed and that 89T and 89T/- be ordered to file their respecti e ,ns3er to the Co0plaint" 9uch other reliefs, Fust and e?uitable, are liBe3ise prayed for" ,ugust 49, &##$ P,)-++, =,R,9-H,N I ,991C-,T69 By5

MARIA LOURDES PAREDES=!ARCIA Counsel Eheels 6>ecuti e 9uites, Eheels Building No" &&& 6" Rodriguez 9r" , e", Quezon City -BP No" ''27% PTR No" 222&$$2 Rizal #4!'4!#$ -BP No" 7#&&7' Pasig #4!#7!#$ =C+6 Co0pliance No" - !###&#47 =C+6 Co0pliance No" --!###9'&$

.17

otion (or Reconsideration

Cc5 :By registered 0ail;

Atty. Nillo T. Divina & Alvin S. Dysangco Divina & Uy Law Offices 8th Floor Pacific Star Bl g. Sen. !il P"yat Ave.# cor. $a%ati Ave. &'(( $a%ati )ity.

6*P+,N,T-1N Copy of the foregoing =otion .or Reconsideration 3as ser ed on counsel for the defendants through registered 0ail due to lacB of 0aterial ti0e and personnel"

MARIA LOURDES P. !ARCIA

N1T-C6 1. /6,R-NH The ClerB of Court Regional Trial Court Branch 97 ,nd ,ttys" )i ina I )ysangco H r e e t - n g s5 Please taBe notice that the foregoing =otion .or Reconsideration is re?uested to be set for hearing on =onday, 9epte0ber 4, &##$ at & oDclocB in the afternoon"

MARIA LOURDES P. !ARCIA