Professional Documents
Culture Documents
164459
April 24, 2007
LIMITLESS POTENTIALS, INC., Petitioner, vs. HON. COURT OF APPEALS,
CRISOSTOMO YALUNG, and ATTY. ROY MANUEL VILLASOR, Respondents.
DECISION
CHICO-NAZARIO, J.:
Before this Court is a Petition for Review on Certiorari under Rule 45 of the
1997 Revised Rules of Civil Procedure seeking to annul and set aside: (1)
The Decision,1 dated 16 September 2003, of the Court of Appeals in CAG.R. SP No. 73463 entitled, Limitless Potentials, Inc. vs. Hon. Manuel D.
Victorio, in his capacity as the Presiding Judge of the Regional Trial Court of
Makati City, Branch 141, Crisostomo Yalung, and Atty. Roy Manuel Villasor,
which dismissed herein petitioners Petition for Certiorari under Rule 65 of
the 1997 Revised Rules of Civil Procedure for lack of merit, and (2) The
Resolution,2 dated 8 July 2004, of the appellate court in the same case
which denied petitioners Motion for Reconsideration because the issues
and arguments raised therein had already been passed upon and
judiciously resolved in the Decision dated 16 September 2003.
The controversy of this case stemmed from the following facts:
On 12 October 1995, Digital Networks Communications and Computers,
Inc. (Digital) and herein petitioner Limitless Potentials, Inc. (LPI), a domestic
corporation duly organized and existing under Philippine laws, entered into
a Billboard Advertisement Contract whereby petitioner was to construct
one billboard advertisement for Digitals product for a period of one year,
with an agreed rental of P60,000.00 per month plus Value Added Tax
(VAT). It was agreed, among other things, that Digital will make a threemonth deposit in the following manner, to wit: (a) P60,000.00 plus VAT
upon the signing of the contract, and (b) P120,000.00 plus VAT upon
completion of the billboard. Digital complied with the aforesaid agreement.
The billboard, however, was destroyed by unknown persons. In view
thereof, the contract between Digital and the petitioner was considered
terminated. Digital demanded for the return of their rental deposit for two
months, but the petitioner refused to do so claiming that the loss of the
billboard was due to force majeure and that any cause of action should be
directed against the responsible persons. Thus, on 18 April 1997, Digital
commenced a suit against herein petitioner before the Metropolitan Trial
Court (MeTC) of Makati City, Branch 66, presided over by then Judge Estela
Perlas-Bernabe (Judge Perlas-Bernabe)3 , for the return of Digitals deposit,
which was equivalent to two months rental inclusive of VAT and attorneys
fees. The case was docketed as Civil Case No. 55170.
On 18 June 1997, consistent with its defense against Digitals Complaint,
petitioner filed a ThirdParty Complaint4 against Macgraphics Carranz
International Corporation (Macgraphics) and herein private respondents
Bishop Crisostomo Yalung (Bishop Yalung) and Atty. Roy Manuel Villasor
(Atty. Villasor) alleging that it had entered into a contract of lease with
Roman Catholic Archbishop of Manila (RCAM), as represented by the
private respondents, over a space inside San Carlos Manor Seminary in
Guadalupe Viejo, Makati City, where petitioner erected the subject
billboard. Petitioner further averred that despite its full compliance with
the terms and conditions of the lease contract, herein private respondents,
together with their cohorts, maliciously dismantled and destroyed the
subject billboard and prevented its men from reconstructing it. Thereafter,
petitioner learned that Macgraphics had "cajoled and induced" RCAM,
through the private respondents, to destroy the subject billboard to enable
Macgraphics to erect its own billboard and advertising signs. Thus, by way
of affirmative defenses, petitioner claimed that: (a) the destruction of the
subject billboard was not of its own making and beyond its control, and (b)
Digitals cause of action, if any, should be directed against the private
respondents and Macgraphics. Hence, petitioner prayed that judgment be
rendered in its favor and to hold private respondents liable for the
following: (a) moral damages in the amount of P1,000,000.00; (b)
exemplary, temperate and nominal damages amounting to P300,000.00;
(c) P300,000.00 as attorneys fees; (d) P50,000.00 as litigation expenses;
and (e) costs of suit, allegedly suffered or incurred by it because of the
willful destruction of the billboard by the private respondents.
In response, private respondents filed a Motion to Dismiss the aforesaid
Third-Party Complaint based on the following grounds: (1) litis pendentia;
(2) lack of cause of action; (3) forum shopping; and (4) lack of privity of
contract. The MeTC, in an Order dated 25 August 1997,5 denied the said
Motion to Dismiss. Petitioner filed an Amended Third-Party Complaint.
Again, private respondents filed a Motion to Dismiss Amended Third-Party
Complaint. However, the MeTC also denied the Motion to Dismiss
Amended Third-Party Complaint in an Order dated 10 October 1997.6
On 9 December 1997, private respondents filed a Petition for Certiorari
with Prayer for Preliminary Restraining Order and/or Writ of Preliminary
Injunction before the Regional Trial Court (RTC) of Makati City, assailing the
Orders dated 25 August 1997 and 10 October 1997 of the MeTC of Makati
City denying their Motion to Dismiss Third-Party Complaint and Motion to
Dismiss Amended Third-Party Complaint, respectively, in Civil Case No.
55170.
The RTC issued an Order on 6 February 1998,7 granting private
respondents prayer for a writ of preliminary injunction, conditioned upon
the posting of an injunction bond in the amount of P10,000.00. Thus, the
MeTC was enjoined from hearing the Third-Party Complaint in Civil Case
No. 55170. The pertinent portion of the aforesaid Order reads, as follows:
When the application for temporary restraining order and/or preliminary
injunction was heard this afternoon, [herein petitioner] who did not file
comment on the petition appeared thru counsel Emmanuel Magnaye. It
was brought out to the attention of this Court that respondent judge is
poised on pursuing the hearing of the case before her despite the
pendency of this petition. It appeared that the case was set by respondent
judge for hearing ex-parte for the reception of [herein petitioners]
evidence on 23 February 1998. It also appeared that [herein private
respondents] were declared in default despite the fact that they have filed
their answer and the motion to lift such order of default and for admission
of the answer was denied by respondent judge.
I.
III.
II.
The Court of Appeals through a Resolution dated 8 July 2004, denied the
petitioners Motion for Reconsideration.
Hence, this Petition.
Petitioner pointed out two basic legal issues wherein the appellate court
committed serious and reversible errors, to wit:
I.
II.
Unless exempted by the court, the applicant files with the court where the
action or proceeding is pending, a bond executed to the party or person
enjoined, in an amount to be fixed by the court, to the effect that the
applicant will pay to such party or person all damages which he may
sustain by reason of the injunction or temporary restraining order if the
court should finally decide that the applicant was not entitled thereto.
Upon approval of the requisite bond, a writ of preliminary injunction shall
be issued.
The aforesaid provision of law clearly provides that the injunction bond is
answerable for all damages. The bond insures with all practicable certainty
that the defendant may sustain no ultimate loss in the event that the
injunction could finally be dissolved.32 Consequently, the bond may
obligate the bondsmen to account to the defendant in the injunction suit
for all damages, or costs and reasonable counsels fees, incurred or
sustained by the latter in case it is determined that the injunction was
wrongfully issued.33 Likewise, the posting of a bond in connection with a
preliminary injunction does not operate to relieve the party obtaining an
injunction from any and all responsibility for damages that the writ may
thereby cause. It merely gives additional protection to the party against
whom the injunction is directed. It gives the latter a right of recourse
against either the applicant or his surety or against both. 34
The contention of the petitioner, thus, is tenable. Attorneys fees, litigation
costs, and costs of delay can be recovered from the injunction bond as long
as it can be shown that said expenses were sustained by the party seeking
recovery by reason of the writ of preliminary injunction, which was later on
determined as not to have been validly issued and that the party who
applied for the said writ was not entitled thereto. The case of Aquino v.
Socorro,35 citing the case of Pacis v. Commission on Elections,36 holds that
the dissolution of the injunction, even if the injunction was obtained in
good faith, amounts to a determination that the injunction was wrongfully
obtained and a right of action on the injunction bond immediately accrues.
It is also erroneous for the appellate court to rule that petitioner is not
entitled to claim damages from the injunction bond simply because the
preliminary injunction was directed against the MeTC and not against the
petitioner. The MeTC does not stand to suffer damages from the injunction
because it has no interest or stake in the Petition pending before it.
Damage or loss is suffered by the party whose right to pursue its case is
suspended or delayed, which in this case, is the petitioner. Upon issuance
of the writ of injunction, it is the petitioner who will stand to suffer
damages for the delay in the principal case because, had it not been for the
injunction, the petitioner would not have incurred additional expenses for
attending the separate hearings on the injunction, and the RTC can already
decide the main case and make a prompt determination of the respective
rights of the parties therein. Hence, even if the preliminary injunction was
directed against the MeTC and not against the petitioner, it is the latter
which has the right to recover from the injunction bond the damages which
it might have suffered by reason of the said injunction.
As to the second main issue in the present case, although we do recognize
that the petitioner had a right to recover damages from the injunction
bond, however, we agree in the findings of the Court of Appeals, which
affirmed the findings of the RTC, that the petitioner did not sustain any
damage by reason of the issuance of the writ of injunction. In the
petitioners Motion for Judgment Against the Bond,37 petitioner stated
therein, thus:
Grazing Reports from 1985 to 1999 or pay the corresponding penalty for
non-submission thereof.7
HGL sent a letter dated March 6, 2003 to DENR Secretary Alvarez seeking
reconsideration. The DENR did not act on the letter and HGL later
withdrew this second letter of reconsideration in its letter of August 4,
2003.
On November 17, 2003, HGL filed a complaint against the DENR for specific
performance and damages with prayer for a temporary restraining order
and/or writ of preliminary injunction, docketed as Civil Case No. 20675
(2003) with the Regional Trial Court of Caloocan City. A writ of preliminary
injunction was issued by the Caloocan City RTC on December 22, 2003,
enjoining the DENR from enforcing its December 6, 2000 Order of
Cancellation.
Meanwhile, HGL had also filed on November 17, 2003, a complaint against
petitioner for Recovery of Possession and Damages with Prayer for TRO
and/or Writ of Preliminary Mandatory Injunction, docketed as Civil Case
No. C-146 with the Regional Trial Court of Culasi, Antique, Branch 13. 9
On December 1, 2003, the Antique trial court heard the application for Writ
of Preliminary Mandatory Injunction in Civil Case No. C-146. Only HGL
presented its evidence. Reception for petitioner's evidence was set to
March 23-24, 2004. Petitioner was notified. But, on March 19, 2004,
petitioner's President wrote the court asking for postponement since its
counsel had suddenly resigned. The trial court refused to take cognizance
of the letter and treated it as a mere scrap of paper since it failed to
comply with the requisites for the filing of motions and since it was not
shown that petitioner's President was authorized to represent petitioner.
Because of petitioner's failure to attend the two scheduled hearings, the
trial court, in an Order dated March 24, 2004, deemed the application for
issuance of a Writ of Preliminary Mandatory Injunction submitted for
decision. Meanwhile, petitioner had filed its Answer dated February 26,
2004, raising among others the affirmative defense that HGL no longer had
any right to possess the subject property since its FLGLA has already been
cancelled and said cancellation had already become final.
On April 14, 2004, petitioner filed a verified Omnibus Motion praying that
the trial court reconsider its Order of March 24, 2004, since petitioner's
failure to attend the hearing was due to an accident. Petitioner also prayed
that the trial court admit as part of petitioner's evidence in opposition to
the application for injunction, certified copies of the DENR Order of
Cancellation dated December 6, 2000; HGL's letter of reconsideration
dated January 12, 2001; letter of DENR Secretary Alvarez dated December
9, 2002 denying reconsideration of the order; and registry return receipt
showing HGL's receipt of the denial of reconsideration. In the alternative,
petitioner prayed that the case be set for preliminary hearing on its
affirmative defense of lack of cause of action and forum-shopping.10 Public
respondent denied the Omnibus Motion in a Resolution dated June 21,
2004.
2.
3.
4.
5.
6.
7.
8.
The Court of Appeals in the assailed Decision dated January 31, 2005,
opined and ruled as follows (which we quote verbatim):
Anent the first issue, WE rule against the petitioner.
Perusal of the allegations in the Complaint filed by the private
respondent with the court a quo show that its cause of action is
mainly anchored on the Forest Land Grazing Lease Agreement
("FLGLA") executed by and between said private respondent and the
Department of Environment and Natural Resources (DENR) which
Makati City, by signing on and in behalf of the said law office. This
Court takes judicial notice of the fact that law offices employ more
than one (1) associate attorney aside from the name partners. As
such, it can easily assign the instant case to its other lawyers who are
more than capable to prepare the necessary "motion for
postponement" or personally appear to the court a quo to explain
the situation.
Even assuming arguendo that Atty. Hilario is the only one who is
knowledgeable of the facts of the case, still, petitioners cannot claim
that there was violation of due process because the "ESSENCE of due
process is reasonable opportunity to be heard x x x. What the law
proscribed is lack of opportunity to be heard." In the case at bar,
petitioner was given two (2) settings to present its evidence but it
opted not to.
Lastly, a prayer for the issuance of a writ of preliminary mandatory
injunction demands urgent attention from the court and as such,
delay/s is/are frowned upon due to the irreparable damage/s that
can be sustained by the movant.
The case filed with the court a quo is principally based on the alleged
encroachment by the petitioner of the subject land over which
private respondent claims it has authority to occupy or possess until
December 31, 2009 pursuant to FLGLA No. 184.
Petitioner claims that the court a quo gravely erred when it issued
the writ of preliminary injunction without first resolving its Motion
for Reconsideration dated July 12, 2004.
This Court finds that the petitioner was not deprived of due process.
It appears from the records of the instant case that the petitioner
was given two (2) settings for the reception of its evidence in support
of its opposition to the prayer of herein private respondent for the
issuance of a writ of preliminary mandatory injunction.
Unfortunately, on both occasions, petitioner did not present its
evidence.
The instant case is not within the purview of the above-cited law
because the issue/s raised herein does not involve or arise out of
petitioner's coal operation contract.
Petitioner claims that its failure to attend the hearings for the
reception of its evidence was excusable due to the sudden
resignation of its lawyer and as such, nobody can attend the hearings
of the case.
SO ORDERED.15
Hence, this instant petition. On February 23, 2005, this Court issued a TRO
enjoining the implementation and enforcement of the Court of Appeals
Decision dated January 31, 2005.16
Petitioner submits in the petition now the following grounds:
I.
II.
III.
IV.
V.
VI.
Before this Court decides the substantive issues raised herein, certain
procedural issues that were raised by the parties must first be addressed.
Petitioner contends that it was improper for the Regional Trial Court of
Antique to issue the writ of preliminary mandatory injunction (and for the
Court of Appeals to affirm the same) without giving it an opportunity to
present evidence and without first resolving the Motion for
Reconsideration dated July 12, 2004. But as borne by the records of the
case, it is evident that petitioner had the opportunity to present evidence
in its favor during the hearing for the application of the writ of preliminary
mandatory injunction before the lower court. However, petitioner's failure
to present its evidence was brought by its own failure to appear on the
hearing dates scheduled by the trial court. Thus, petitioner cannot
complain of denial of due process when it was its own doing that
prevented it from presenting its evidence in opposition to the application
for a writ of preliminary mandatory injunction. It must be pointed out that
the trial court correctly refused to take cognizance of the letter of
petitioner's President which prayed for the postponement of the scheduled
hearings. Said letter was not a proper motion that must be filed before the
lower court for the stated purpose by its counsel of record. Moreover,
there was absolutely no proof given that the sender of the letter was the
duly authorized representative of petitioner.
Second, the filing of the motion for reconsideration dated July 12, 2004,
which essentially reproduced the arguments contained in the previously
filed and denied Omnibus Motion dated April 14, 2004, renders the said
motion for reconsideration dated July 12, 2004, a mere pro forma motion.
Moreover, the motion for reconsideration dated June 12, 2004, being a
second motion for reconsideration, the trial court correctly denied it for
being a prohibited motion.18
Third, it must be stated that the petition for certiorari before the Court of
Appeals should not have prospered because petitioner failed to file a
motion for reconsideration from the assailed resolution of the Regional
Trial Court of Antique, granting the writ of preliminary mandatory
injunction. Well settled is the rule that before a party may resort to the
extraordinary writ of certiorari, it must be shown that there is no other
plain, speedy and adequate remedy in the ordinary course of law. Thus, it
has been held by this Court that a motion for reconsideration is a condition
sine qua non for the grant of the extraordinary writ of certiorari.19 Here, a
motion for reconsideration was an available plain, speedy and adequate
remedy in the ordinary course of law, designed to give the trial court the
opportunity to correct itself.
Now on the merits of the instant petition.
The pivotal issue confronting this Court is whether the Court of Appeals
seriously erred or committed grave abuse of discretion in affirming the
September 16, 2004 Resolution of the Regional Trial Court of Antique
granting the writ of preliminary mandatory injunction.
Under Article 539 of the New Civil Code, a lawful possessor is entitled to be
respected in his possession and any disturbance of possession is a ground
for the issuance of a writ of preliminary mandatory injunction to restore
the possession.20 Thus, petitioner's claim that the issuance of a writ of
preliminary mandatory injunction is improper because the instant case is
allegedly one for accion publiciana deserves no consideration. This Court
has already ruled in Torre, et al. v. Hon. J. Querubin, et al.21 that prior to the
promulgation of the New Civil Code, it was deemed improper to issue a
writ of preliminary injunction where the party to be enjoined had already
taken complete material possession of the property involved. However,
with the enactment of Article 539, the plaintiff is now allowed to avail of a
writ of preliminary mandatory injunction to restore him in his possession
during the pendency of his action to recover possession.22
It is likewise established that a writ of mandatory injunction is granted
upon a showing that (a) the invasion of the right is material and
substantial; (b) the right of complainant is clear and unmistakable; and (c)
there is an urgent and permanent necessity for the writ to prevent serious
damage.23
In the instant case, it is clear that as holder of a pasture lease agreement
under FLGLA No. 184, HGL has a clear and unmistakable right to the
possession of the subject property. Recall that under the FLGLA, HGL has
the right to the lawful possession of the subject property for a period of 25
years or until 2009. As lawful possessor, HGL is therefore entitled to
protection of its possession of the subject property and any disturbance of
its possession is a valid ground for the issuance of a writ of preliminary
mandatory injunction in its favor. The right of HGL to the possession of the
property is confirmed by petitioner itself when it sought permission from
HGL to use the subject property in 1999. In contrast to HGL's clear legal
right to use and possess the subject property, petitioner's possession was
merely by tolerance of HGL and only because HGL permitted petitioner to
use a portion of the subject property so that the latter could gain easier
access to its mining area in the Panaan Coal Reserve.
The urgency and necessity for the issuance of a writ of mandatory
injunction also cannot be denied, considering that HGL stands to suffer
material and substantial injury as a result of petitioner's continuous
intrusion into the subject property. Petitioner's continued occupation of
the property not only results in the deprivation of HGL of the use and
possession of the subject property but likewise affects HGL's business
operations. It must be noted that petitioner occupied the property and
prevented HGL from conducting its business way back in 1999 when HGL
still had the right to the use and possession of the property for another 10
years or until 2009. At the very least, the failure of HGL to operate its
cattle-grazing business is perceived as an inability by HGL to comply with
the demands of its customers and sows doubts in HGL's capacity to
continue doing business. This damage to HGL's business standing is
irreparable injury because no fair and reasonable redress can be had by
HGL insofar as the damage to its goodwill and business reputation is
concerned.
Petitioner posits that FLGLA No. 184 had already been cancelled by the
DENR in its order dated December 6, 2000. But as rightly held by the Court
of Appeals, the alleged cancellation of FLGLA No. 184 through a unilateral
act of the DENR does not automatically render the FLGLA invalid since the
unilateral cancellation is subject of a separate case which is still pending
before the Regional Trial Court of Caloocan City. Notably, said court has
issued a writ of preliminary injunction enjoining the DENR from enforcing
its order of cancellation of FLGLA No. 184.
The Court of Appeals found that the construction of numerous buildings
and blasting activities by petitioner were done without the consent of HGL,
but in blatant violation of its rights as the lessee of the subject property. It
was likewise found that these unauthorized activities effectively deprived
HGL of its right to use the subject property for cattle-grazing pursuant to
the FLGLA. It cannot be denied that the continuance of petitioner's
possession during the pendency of the case for recovery of possession will
not only be unfair but will undeniably work injustice to HGL. It would also
cause continuing damage and material injury to HGL. Thus, the Court of
Appeals correctly upheld the issuance of the writ of preliminary mandatory
injunction in favor of HGL.
WHEREFORE, the instant petition is DENIED. The Decision dated January
31, 2005, of the Court of Appeals in CA G.R. CEB SP No. 00035, which
affirmed the Resolution dated September 16, 2004 of the Regional Trial
Court of Culasi, Antique, Branch 13, as well as the Writ of Preliminary
Mandatory Injunction dated October 6, 2004 issued pursuant to said
Resolution, is AFFIRMED. The temporary restraining order issued by this
Court is hereby lifted. No pronouncement as to costs. SO ORDERED.
x--------------------------------------------------x
DECISION
CARPIO MORALES, J.:
Petitioner China Banking Corporation sold a lot located at St. Benedict
Subdivision, Sindalan, San Fernando, Pampanga, which was covered by
Transfer Certificate of Title (TCT) No. 450216-R to petitioner-spouses Joey
and Mary Jeannie Castro (the Castro spouses). It sold two other lots also
located in the same place covered by TCT Nos. 450212-R and 450213-R to
petitioner-spouses Richard and Editha Nogoy (the Nogoy spouses).
The lots of the Castro spouses and the Nogoy spouses are commonly
bound on their southeastern side by Lot No. 3783-E, which is covered by
TCT No. 269758-R in the name of respondent Benjamin Co (Co) and his
siblings.
Co and his siblings entered into a joint venture with respondent Three
Kings Construction and Realty Corporation for the development of the
Northwoods Estates, a subdivision project covering Lot No. 3783-E and
adjacent lots. For this purpose, they contracted the services of respondent,
Engineer Dale Olea.
In 2003, respondents started constructing a perimeter wall on Lot No.
3783-E.
On November 28, 2003, petitioners, through counsel, wrote respondents
asking them to stop constructing the wall, and remove all installed
construction materials and restore the former condition of Lot No. [3]783-E
which they (petitioners) claimed to be a road lot. 1 They also claimed that
the construction obstructed and closed the only means of ingress and
egress of the Nogoy spouses and their family, and at the same time, caved
in and impeded the ventilation and clearance due the Castro spouses
residential house.2
Petitioners demand remained unheeded, prompting them to file before
the Regional Trial Court (RTC) of San Fernando, Pampanga a complaint,3
docketed as Civil Case No. 12834, for injunction, restoration of road
lot/right of way and damages with prayer for temporary restraining order
and/or writ of preliminary injunction.
Before respondents filed their Answer,4 petitioners filed an Amended
Complaint,5 alleging that the construction of the perimeter wall was almost
finished and thus modifying their prayer for a writ of preliminary injunction
to a writ of preliminary mandatory injunction, viz:
WHEREFORE, it is respectfully prayed of this Honorable Court that:
A. Before trial on the merits, a temporary restraining order be issued
immediately restraining the defendants from doing further construction of
the perimeter wall on the premises, and thereafter, a writ of preliminary
mandatory injunction be issued enjoining the defendants from
perpetrating and continuing with the said act and directing them jointly
and severally, to restore the road lot, Lot 3783-E to its previous condition.
x x x x 6 (Underscoring in the original; emphasis supplied)
After hearing petitioners application for a writ of preliminary mandatory
injunction, Branch 44 of the San Fernando, Pampanga RTC denied the
same, without prejudice to its resolution after the trial of the case on the
merits, in light of the following considerations:
After a judicious evaluation of the evidence, the Commissioners Report on
the Conduct of the Ocular Inspection held on February 14, 2004, as well as
the pleadings, the Court is of the opinion and so holds that a writ of
preliminary injunction should not be issued at this time. Plaintiffs have not
clearly shown that their rights have been violated and that they are
entitled to the relief prayed for and that irreparable damage would be
suffered by them if an injunction is not issued. Whether lot 3783-E is a road
lot or not is a factual issue which should be resolved after the presentation
of evidence. This Court is not inclined to rely only on the subdivision plans
presented by plaintiffs since, as correctly argued by defendants, the
subdivision plans do not refer to lot 3783-E hence are not conclusive as to
the status or classification of lot 3783-E. This court notes further that
Subdivision Plan Psd-03-000577 of Lot 3783 from which the other
subdivision plans originates [sic] does not indicate lot 3783-E as a road lot.
Even the physical evidence reveals that lot 3783-E is not a road lot. The
Court noticed during the ocular inspection on February 14, 2004, that there
is a PLDT box almost in front of lot 3783-E. There is no visible pathway
either in the form of a beaten path or paved path on lot 3783-E. Visible to
everyone including this court are wild plants, grasses, and bushes of
various kinds. Lot 3783-E could not have been a road lot because Sps.
Nogoy, one of the plaintiffs, even built a structure on lot 3783-E which they
used as a coffin factory.
Plaintiffs failed to prove that they will be prejudiced by the construction of
the wall. The ocular inspection showed that they will not lose access to
their residences. As a matter of fact, lot 3783-E is not being used as an
access road to their residences and there is an existing secondary road
within St. Benedict Subdivision that serves as the main access road to the
highway. With respect to the blocking of ventilation and light of the
residence of the Sps. Castro, suffice it to state that they are not deprived of
light and ventilation. The perimeter wall of the defendants is situated on
the left side of the garage and its front entrance is still open and freely
accessible.
This is indeed an issue of fact which should be ventilated in a full blown
trial, determinable through further presentation of evidence by the parties.
xxx
xxxx
WHEREFORE, premises considered, plaintiffs application for the issuance
of a writ of preliminary mandatory injunction is denied without prejudice
to its resolution after the trial of the case on the merits.7 (Underscoring
supplied)
Their Motion for Reconsideration8 having been denied, petitioners filed a
petition for certiorari9 before the Court of Appeals which dismissed the
same10 and denied their subsequent Motion for Reconsideration.11
Hence, the petitioners filed the present petition,12 faulting the Court of
Appeals in
I.
II.
III.
enjoying the fruits of the land in question until and unless he obtained a
final judgment in a proper action declaring these lands to be the property
of the estate of which he is administrator, and prayed further that a
preliminary injunction be issued restraining defendant from continuing in
possession or enjoying the fruits of the land in question pending the trial of
the cause.
The complaint alleges that the property in question was assigned to
plaintiff's deceased husband under the terms of an extra judicial partition
contract executed in the year 1887 by the heirs of Gregoria Arbes,
plaintiff's husband's first wife, and that ever since that date until the
defendant took possession of this land, plaintiff and her husband had
continued in the quiet, peaceable, and exclusive possession thereof. The
trial court, apparently without giving the defendant an opportunity to be
heard, granted the preliminary injunction prayed for, conditioned upon the
execution of a bond for costs and damages, whereupon the defendant
presented a motion which though irregular in form may fairly be regarded
as a demurrer to the complaint on the ground that the facts alleged do not
constitute a cause of action, and prayed that the preliminary injunction be
dissolved.
The trial court overruled the demurrer and declined to dissolve the
preliminary injunction, and defendant without excepting to the ruling of
the court withdrew his motion and filed his answer. In this answer
defendant admitted having taken possession of the land in question, as
alleged by the plaintiff, but denied plaintiff's allegation that she and her
husband had been in the exclusive possession thereof, and alleged that the
land in question was the property of Gregoria Arbes, deceased, of whose
estate he is the administrator, and that after the death of Gregoria Arbes, it
passed pro indiviso to her heirs, who from the time of her death continued
in joint possession thereof, until he took possession upon his appointment
as administrator; he also alleged that one of the heirs, Vicente Sola,
widower of Gregoria Arbes, deceased, married the plaintiff; that plaintiff's
claim to an interest in the property in question is or should be strictly
limited to the interest which she is entitled to take from her husband, since
deceased; and that while it is true that she and her husband exercised
certain rights of possession of the land in question, they never had
exclusive possession, and such rights of possession as they did exercise
were exercised not only on their behalf but on behalf of all the heirs of
Gregoria Arbes.
Upon these pleadings the parties went to trial, and plaintiff introduced
evidence tending to prove that the land in question was originally the
property of her husband, Vicente Sola, acquired by him, not from his wife,
Gregoria Arbes, but by purchase, in part prior to, and in part after his
marriage with his first wife; she also introduced in evidence a document,
dated January 31, 1887, purporting to be a partition agreement between
her husband Sola, and the other heirs of Gregoria Arbes who died a short
time prior to the execution of the instrument, whereby the land in question
was assigned to Sola as his property. Plaintiff further introduced testimony
which clearly established her allegation that from the date of that
instrument until the time when defendant took possession of the land, she
and her husband had had the exclusive possession thereof.
Defendant did not deny the execution of the partition agreement, and
wholly failed to proved that the land in question was or is a part of the
estate of Gregoria Arbes, deceased, or to establish his allegation that
plaintiff and her husband were not in the exclusive possession of the land
in question from the date of its execution to the time when he took
actions of the Spanish procedural law; but while the injunction resembles
in many respects the interdicto of the Roman law, especially the decretal
(decretale, quod praetor re nata implorantibus decrevit), and while it also
resembles to a certain degree in its operation and effect, the interdictos de
adquirir, de retener, and de recobrar or de despojo of the Spanish
procedural law; nevertheless, it is wholly distinct therefrom, and, as a rule,
the circumstances under which, in accordance with the former procedural
law, these interdictos properly issued, would not justify nor sustain the
issuance of an injunction, as defined and provided in the new Code of Civil
Procedure. An injunction is a "special remedy" adopted in that code from
American practice, and originally borrowed from English legal procedure,
which was there issued by the authority and under the seal of a court of
equity, and limited, as in other cases where equitable relief is sought, to
cases where there is no "plain, adequate, and complete remedy at law" (30
Barb., 549; 5 R. I., 472; 121 N. Y., 46; 31 Pa., 387; 32 Ala., N. S., 723; 37 N.
H., 254; 61 Hun., 140; 145 U. S., 459; 141 Ill., 572; 49 Fed. Rep., 517; 37 id.,
357; 129 Md., 464; 109 N. C., 21; 83 Wis., 426; 115 Mo., 613), which "will
not be granted while the rights between the parties are undetermined,
except in extraordinary cases where material and irreparable injury will
done," which can not be compensated in damages, and where there will be
no adequate remedy (3 Bosw., 607; 1 Beasl., 247, 542; 15 Md., 22; 13 Cal.,
156, 190; 6 Wis., 680; 16 Tex., 410; 28 Mo., 210; 24 Fla., 542; 39 N. H., 182;
12 Cush., 410; 27 Ga., 499; 1 McAll., 271; 54 Fed. Rep., 1005; 64 Vt., 643),
and which will not, as a rule, be granted, to take property out of the
possession of one party and put it into that of another whose title has not
been established by law. (144 U. S., 119; 40 W. N. C. Pa., 121.)
This court has frequently held, when treating of the special remedies by
injunction, mandamus and prohibition, which are provided in the new
Code of Procedure in Civil Cases, that the accepted American doctrine
limiting the use of these remedies to cases where there is no other
adequate remedy, and otherwise controlling the issuance of these writs,
and must be deemed to limit their use in like manner in this jurisdiction,
when not otherwise provided by law: to hold otherwise would be to render
practically of no effect the various provisions of the code touching many if
not most of the ordinary actions, and the enforcement of judgment in such
actions; for it may well be supposed that if a complainant could secure
relief by injunction in every case where "the defendant is doing or
threatens or is about to do, or is procuring or suffering to be done, some
act probably in violation of the plaintiff's rights" and could enforce the
judgment granting the injunction by the summary contempt proceedings
authorized in section 172 of the code to punish violations of injunctions, he
would seldom elect to enforce his rights in such cases by the ordinary
remedies, involving as they do the difficult and ofttimes fruitless labor of
enforcing judgments obtained therein by execution. But so many cases
have come before us where preliminary injunctions have been issued
apparently without regard to this rule, that we are satisfied that the
erroneous impression still prevails, in some quarters, that a preliminary
injunction must issue where a prima facie showing is made of the existence
of the circumstances under which such injunctions may be granted as set
out in section 164 of the Code of Civil Procedure, without keeping in mind
the fact that applications for injunctions are made to the sound discretion
of the court, and the exercise of that discretion is controlled by the
accepted doctrines touching the granting of injunctions in such cases; and
we may add that the records also disclose a dangerous tendency to grant
permanent injunctions on insufficient grounds, as a result of a similar
erroneous construction of the provisions of the code in that regard.
No brief was filed by plaintiff on appeal, and the contentions of the parties
in the court below are not very clearly set out in the very short brief of the
defendant and appellant. It appears, however, that defendant challenged
the jurisdiction of the trial court, on the ground that the summary
interdictal actions of the Spanish procedural law have been done away
with by the provisions of the new Code of Procedure in Civil Cases, the
interdicto de recobrar or de despojo having been expressly displaced by the
summary remedies prescribed in section 80 of the new code, for the
recovery of lands or buildings of which one is deprived by force,
intimidation, fraud, or strategy within a year prior to the institution of the
action; and defendant insists that the action instituted by plaintiff, while in
form a proceeding praying for an injunction under the new code,
assimilated to the former proceeding praying for an interdicto de recobrar
or de despojo, is in fact an action which could only be maintained under the
provisions of section 80 of the new code, of which original jurisdiction is
conferred upon the courts of the justice of the peace, exclusive of the
Court of First Instance. Plaintiff and appellee on the other hand seems to
have insisted that the injunction proceedings instituted by her were
assimilated rather to the summary action known as the interdicto de
retener and that the facts alleged and proven establishing her right to an
interdicto de retener, under the old law, she is entitled to an injunction
under the new code, that remedy being the equivalent provided by the
new code for the interdicto of the old law.
But while we agree with defendant and appellant that the summary
remedies provided in section 80 may be said to replace and perhaps
abrogate the old interdicto de recobrar or de despojo, and that if the facts
alleged and proven made out a cause of action under that section and,
therefore, within the exclusive jurisdiction of the court of the justice of the
peace, it would be necessary to hold that the trial court was wholly without
original jurisdiction; and while we can not agree with the plaintiff and
appellee that the facts set out in the pleadings and evidence would support
the issuance of an interdicto de retener, even under the former procedure,
because possession of the land and buildings had been actually lost to
plaintiff when the action was instituted, nor can we agree with her that
even if a proper case for the granting of an interdicto de retener under the
old procedure had been established, it necessarily follows that an
injunction should issue under the new procedure; and without deciding
whether all the summary interdictal remedies of the Spanish law have been
wholly and in all cases abolished under the provisions of the new code, it is
sufficient for the purpose of this decision to hold that since there is nothing
in the allegations or proof to show that defendant obtained possession of
the land in question by force, intimidation, fraud, or strategy, the action is
not in the nature of the summary remedy known to the old law as an
interdicto de recobrar or de despojo, nor is it the summary remedy of
forcible entry and wrongful detainer provided in section 80 of the new
code, and therefore it does not fall within the exclusive jurisdiction of the
court of the justice of the peace, to the exclusion of the Court of First
Instance, which tried the case.
This petition for review assails the Decision1 dated January 20, 2003 and
Resolution2 dated May 20, 2003 of the Court of Appeals in CA-G.R. SP No.
52946. The Court of Appeals lifted the amended writ of preliminary
injunction dated December 29, 1998 issued by the Regional Trial Court,
Branch 14 of Nasugbu, Batangas in Civil Case No. 345 and reinstated the
original writ dated December 12, 1996.
What has been said disposes of all the errors assigned by appellant, except
his assignment of error based on his contention that the administrator
having taken possession as an officer of the court wherein the estate was
being administered, his conduct in that regard should not be questioned,
except in the course of the administration proceedings.
We have frequently held that a contested claim of an administrator that
certain rights of possession and ownership are the property of the estate
which he represents must be determined in a separate action, and not in
Ten days from the date of this decision let judgment be entered, reversing
the judgment of the trial court and dissolving the preliminary and
permanent injunctions issued therein, without costs either party in this
instance, and ten days thereafter let the record be returned to the court
below where, upon the amendment of the complaint along the lines
therein indicated, judgment will be rendered in favor of the plaintiff for the
possession of the lands described in the complaint, together with the costs
in the Court of First Instance, but without damages, which were not
satisfactorily established by the evidence of record. So ordered.
G.R. No. 158141
July 11, 2006
FAUSTO R. PREYSLER, JR., petitioner, vs. COURT OF APPEALS and FAR
EAST ENTERPRISES, INC., respondents.
DECISION
QUISUMBING, J.:
2)
2.
3.
4.
Private respondent filed a petition for certiorari with the Court of Appeals,
which set aside the amended writ dated December 29, 1998 and reinstated
the original writ dated December 12, 1996 with modification as to the
amount of the bond. The petitioner moved for reconsideration, but the
same was denied.
Petitioner now comes before us claiming that the Court of Appeals:
I.
II.
III.
Simply, the issue is whether there was a legal basis for the issuance of the
amended writ of injunction. Likewise, we need to resolve whether the right
of passage allowed in the uncontested original writ applies not only to the
petitioner and his household, but also to his visitors, contractors,
construction workers, authorized persons, heavy equipment machinery,
and construction materials as well as the installation of power lines.
Petitioner contends that inherent in the right of way under Article 649 6 of
the New Civil Code is the right to cultivate and develop the property, which
is an attribute of ownership provided under Article 428. 7 According to
petitioner, the passage of heavy equipment and construction materials
through the subdivision is granted by Article 656.8 Petitioner adds that he
was not seeking the right of way only for occasional visits to his property
but also to develop, use and enjoy it.
Private respondent claims that what was granted in the original writ was
not the easement of right of way but only the maintenance of the status
quo. It maintains that from the very beginning, petitioner and his
household were allowed into the subdivision only because petitioner
owned several lots in the subdivision. Hence, according to private
respondent, the Court of Appeals properly dissolved the amended writ as
the status quo protected by the original writ did not include the passage of
construction workers in petitioner's property outside the subdivision.
Private respondent stresses that at the time the original writ was applied
for there was no construction work yet.
Private respondent argues that its recognition of the original writ should
not be construed as admitting that petitioner had a right of way; and with
no easement of right of way, petitioner cannot claim other rights under the
law on easement. It further contends that acts prohibited and allowed
under the amended writ amounted to a premature adjudication on the
merits of the main case on whether or not petitioner has a right of way,
which is still pending before the trial court.
Prefatorily, we note that what was granted by the trial court was the
preliminary injunction, and that the main case for right of way has not yet
been settled. We have in previous cases9 said that the objective of a writ of
preliminary injunction is to preserve the status quo until the merits of the
case can be fully heard. Status quo is the last actual, peaceable and
uncontested situation which precedes a controversy.10 The Court of
Appeals was correct in its findings that the last actual, peaceful and
uncontested situation that preceded the controversy was solely the access
of petitioner and his household to his property outside the subdivision for
visits and inspections. At the time the writ was applied for in 1995, there
was still no construction going on in the property. It was merely raw land.
The use of the subdivision roads for ingress and egress of construction
workers, heavy equipment, delivery of construction materials, and
installation of power lines, are clearly not part of the status quo in the
original writ. Along this line, the Court of Appeals properly set aside the
amended writ and reinstated the original writ.
However, under Article 656 of the New Civil Code, if the right of way is
indispensable for the construction, repair, improvement, alteration or
beautification of a building, a temporary easement is granted after
payment of indemnity for the damage caused to the servient estate. In our
view, however, "indispensable" in this instance is not to be construed
literally. Great inconvenience is sufficient.11 In the present case, the trial
court found that irrespective of which route petitioner used in gaining
access to his property, he has to pass private respondent's subdivision.
Thus we agree that petitioner may be granted a temporary easement. This
temporary easement in the original writ differs from the permanent
easement of right of way now being tried in the main case.
The law provides that temporary easement is allowed only after the
payment of the proper indemnity. As there are neither sufficient
allegations nor established facts in the record to help this Court determine
the proper amount of indemnity, it is best to remand the case to the trial
court for such determination.
Additionally, we find that the installation of electric power lines is a
permanent easement not covered by Article 656. Article 656 deals only
with the temporary easement of passage. Neither can installation of
electric power lines be subject to a preliminary injunction for it is not part
of the status quo. Besides, more damage would be done to both parties if
the power lines are installed only to be removed later upon a contrary
judgment of the court in the main case.
WHEREFORE, the petition is PARTIALLY GRANTED.
We hereby order (a) private respondent to allow the right of passage thru
the subdivision by the petitioner's visitors and guests, contractors,
construction workers, heavy equipment vehicles, and delivery construction
materials; and (b) petitioner to pay private respondent the indemnity
therefor to be determined by the trial court. The case is hereby
REMANDED to the trial court for the determination of the proper amount
of indemnity for the temporary easement under Article 649.
No pronouncement as to costs. SO ORDERED.
The court, after the witnesses summoned had been examined, decided, on
August 20, 1908, that the defendants had committed contempt of court
and imposed upon each of them a fine of P200, and imprisonment until
they should duly comply with the writ of injunction, and sentenced each of
them to pay one-half of the costs.
Defendants excepted to this judgment and, the required bill of exceptions
having been submitted, the Supreme Court, in its decision of January 11,
[31] 1910,1 dismissed the appeal on the ground that the said bill of
exceptions had been improperly admitted, inasmuch as the order issued in
connection with the incidental question of contempt of court, could be
reviewed only after the rendition of judgment on the main issue, and not
until then could the said incident of contempt be, by means of a bill of
exceptions, submitted to this court; therefore the records in the case were
remanded to the court below, later to be transmitted to the clerk of this
court upon the filing of the main record with the bill of exceptions.
By the writ of preliminary injunction issued on June 26, 1908, the original
of which is on file, page 7 of the main record, the defendants Alejandro and
Timoteo Cajucom, their attorneys, representatives and agents, were
enjoined from performing any act whatever that might tend to close and
obstruct the canal, a branch, called Paligui ng Buquid Puntang Piniping, of
an estero situated in the barrio of Biga of the pueblo of Bongabon, Nueva
Ecija, and to cease to obstruct or hinder the course of the water that
should flow through the said branch.
In the written complaint presented on June 22, 1908, it is averred that the
said canal or estero was closed by the representatives of the defendants,
on the 1st of June of the year therein stated, and that since then the water
which it ordinarily carried had ceased to flow through it, the plaintiff's
lands thereby being deprived of irrigation. So that when the writ of
injunction was issued on the 26th of the said month, it was taken for
granted that the estero or canal in question was closed and that the water
did not run through it, as occurred prior to the said 1st of June; and counsel
for the plaintiffs, in charging, by a writing of July 6, 1908, that contempt of
court was committed, stated that the defendants, according to the
information he had, were still obstructing and hindering the passage of the
water, in disobedience of the writ of injunction.
The defendants having been notified to show cause why they should not be
punished for contempt of court and disobedience of the preliminary
injunction issued by the court, answered that since the 3rd of July, the date
when they were notified by the deputy sheriff, they had complied with the
prohibitory order and had not done anything whatever, by themselves or
through others in their representation, to the stream or ditch in question,
which was closed by two tenants of one of the defendants, Alejandro
Cajucom, on June 1, 1908; as acknowledged by said tenants.
The writ issued by the court contained no order instructing the defendants
to raise or remove the obstructions that prevented the water from flowing
through the said canal or ditch.
The canal was obstructed and closed on June 1st, and when the persons
who closed it were notified on July 3 that they should abstain from
performing any act whatever tending to obstruct and prevent the flow of
water, the canal or ditch still remained closed, and the record shows no
proof that it was afterwards opened to the passage of water, nor that,
after the defendants had been notified of the injunction, they again closed
it. The fact that the latter failed to remove the obstruction they had placed
in the said canal or estero for the purpose of preventing the passage of the
water, since they were not ordered so to do by the judicial writ, is not
sufficient to make them liable for contempt of court.
The act of the closing of the canal occurred prior to the issuance of the
writ, and, since a thing that has already been done can not be prohibited,
by the mere fact of there not having been done what was not ordered in
the writ it can not be held that a judicial order was disobeyed and willfully
disregarded.
Section 162 of the Code of Civil Procedure prescribes:
An injunction is a writ or order requiring a person to refrain from
particular act.
The said writ prohibited the performance of any act that would obstruct,
close, or hinder the course of the water through the Piniping canal or
creek, when it was already obstructed and closed; and as the removal of
the impediment or obstruction was not ordered, the defendants were not
obliged to perform any particular act, and their inaction in leaving the canal
closed does not constitute contempt of court, as they did not violate any
judicial prohibition.
The record shows that the prohibition was issued after the closing of the
canal; hence, if the defendants did not remove the obstruction, they
disobeyed no order. In the syllabus of decision No. 1697, Municipal council
of Santa Rosa vs. Provincial Board of La Laguna (3 Phil. Rep., 206), the rule
was laid down that the commission of an act already done can not be
enjoined. To say that it could, would be nonsense.
THE MAIN ISSUE
On January 28, 1909, the plaintiffs filed an amended complaint, with the
permission of the court, wherein they alleged that certain of them named
Maria Marcelo, Crisanto Rubio, Alipio Espaol or Estaol, Marcelo Mantile,
Adriano Espaol or Estaol, Sebastian Bancod, Claudio Angeles, Diego
Santiago, Raymundo Santiago, Anacleto de los Reyes, Rafael Mendoza,
Clemente Alivia, Marcelino Fajardo, and Segundo Ramos had been, on or
about June 1, 1908, and were at the time, the proprietors and owners of
rice lands situated in the barrio of Biga of the pueblo of Bongabon, and that
the other plaintiffs were planters and cultivators of some portions of the
said islands; that (following the statement in the complaint as to the
boundaries or adjacent lands of each of their respective properties) the
said Paligui ng Buquid Puntang Piniping estero or creek existed and had
always existed in the afore-mentioned barrio; that water flowed through it
on or about June 1, 1908, and the plaintiffs used that water in the
cultivation of their above-mentioned lands; that, on or about the date
aforesaid, the defendants, by themselves and through their agents and
representatives, obstructed and closed the mouth of the estero in such
manner that the lands described were deprived of the water that had
flowed and should flow through the said estero; that, on or about the 4th
of October of the same year before mentioned, the continual heavy rains
and high floods carried away the obstruction in the said Paligui ng Buquid
Puntang Piniping estero; that, in view of the statements made by the
defendants, they believed that the latter would again close the estero in
order to obstruct the passage of the water to their (the plaintiffs')
properties; and that the plaintiffs, through the closing of the said estero or
creek, suffered losses and damages in the following amounts: Maria
Marcelo, P1,500; Crisanto Rubio, P250; Alipio Espaol, P75; Marcelo
Mantile, P2,500; Adriano Espaol, P75; Sebastian Bancod, P400; Gregorio
Corpus, P150; Claudio Angeles, P250; Doroteo Dacuno, P250; Fernando
2.
3.
4.
A rough sketch must be drawn that shall show the location of the lands of
the defendants and those of the plaintiffs; the points where the said two
esteros and the Sibul Spring are situated; the exact point where the closure
of the canal was effected; which of the lands are situated in high places and
which in low places; and in what direction the water flows after arising
from the Sibul Spring and entering into the Sapang Cabasan estero.
With regard to main issues of this suit, the object of the plaintiffs is to
obtain from the court an order decreeing the former preliminary injunction
short time ago, or whether, by the signs observed on its banks, it appears
that it was opened many years ago, stating since when it has been opened.
6. Investigation and report shall be made as to whether the plaintiffs' lands
receive irrigation water from any spring, estero, or creek, other than those
before mentioned, and, if so, their names and the distances between them,
and the latter shall be noted on the rough sketch drawn by the surveyors.
From the result obtained from the proceedings, and the rough sketch
drawn by the experts, we shall easily be able to arrive at a conclusion as to
whether the defendants had or had not a right to close the Cabasan or
Puntang Piniping creek, thus depriving the plaintiffs' sementeras of the
water flowing through it, or whether, on the other hand, the plaintiff had a
right to the enjoyment and use of such water for the irrigation of their
lands, and whether, through the want of the same, they suffered losses
and damages by fault of the said defendants.
For the foregoing reasons, justice demands, in our opinion, that we find
that the defendants Alejandro and Timoteo Cajucom did not commit any
act whatever constituting contempt of a judicial order. The order of August
20, 1908 is reversed. No special findings is made as to the costs of the
incidental proceedings.
The judgment appealed from, of July 26, 1909, is set aside, and the record
of the case shall be remanded, with a certified copy of this decision, to the
court below in order that the judge may proceed with a rehearing and
conduct the proceedings hereinbefore specified, and in due season render
judgment wherein he shall take into account the evidence already
contained in the record, together with such new evidence as may be
admitted, in accordance with this decision and in harmony with the law. So
ordered.
G.R. No. L-5656
March 24, 1954
JUAN G. FELICIANO, ET AL., petitioners-appellants, vs. MARIANO ALIPIO,
ET AL., respondents-appellee.
JUGO, J.:
On September 21, 1951, the Director of Public Schools issued Circular No.
20, series of 1951, which reads as follows:
PUBLIC SCHOOL PUPILS AND STUDENTS MAY BE REQUIRED TO
SALUTE THE FLAG
To Division Superintendents:
1. Quoted in the inclosure to this Circular for the information and
guidance of school officials and teachers, is Opinion No. 370, series of
1951, of the Honorable, the Secretary of Justice, "regarding the
power of the Director of Public Schools to require all pupils and
students in public schools to salute the flag, on pain of being barred
from admission to, or expelled from, such schools."
This Circular revokes Circular No. 33, series of 1948.
The petitioners filed before the Court of First Instance of Tarlac a petition
for declaratory relief and mandatory injunction, praying that the above
circular be declared null and void, that preliminary injunction be issued
prohibiting the respondents Mariano Alipio and other teachers of the
Malacampa Elementary School, and the Director of Public Schools, from
carrying out the provisions of said circular, and that, after trial, the
preliminary injunction be made permanent.
The Provincial Fiscal of Tarlac filed a motion to dismiss the petition on the
ground that under section 2, Rule 66, it was not a case in which a
declaratory judgment could be rendered. The court dismissed the case.
Hence, the petitioners have appealed to this Court.
It is not necessary to decide whether the petition for declaratory judgment
be granted in this case, because in the petition presented in the court
below, in addition to the declaratory judgment, the petitioners prayed for
the issuance of a permanent injunction, which is equivalent to an action for
prohibition against public officers, and as such we consider it, without
passing at this stage of the proceedings on the merits of said action.
In the present case, we cannot consider the question as to the
constitutionality of the circular as this will be decided after the regular
hearing.
In view of the foregoing, the order of the court dismissing the petition is
reversed, and the case returned to the Court of First Instance of Tarlac for
further proceedings as in an action for prohibition, without costs. So
ordered.
G.R. No. 168008
August 17, 2011
PETRONILO J. BARAYUGA, Petitioner, vs. ADVENTIST UNIVERSITY OF THE
PHILIPPINES, THROUGH ITS BOARD OF TRUSTEES, REPRESENTED BY ITS
CHAIRMAN, NESTOR D. DAYSON, Respondents.
DECISION
BERSAMIN, J.:
The injunctive relief protects only a right in esse. Where the plaintiff does
not demonstrate that he has an existing right to be protected by injunction,
his suit for injunction must be dismissed for lack of a cause of action.
The dispute centers on whether the removal of the petitioner as President
of respondent Adventist University of the Philippines (AUP) was valid, and
whether his term in that office was five years, as he insists, or only two
years, as AUP insists.
1
In the January 27, 2003 special meeting, the petitioner sent a letter to the
Board of Trustees. The members, by secret ballot, voted to remove him as
President because of his serious violations of fundamental rules and
procedures in the disbursement and use of funds as revealed by the special
audit; to appoint an interim committee consisting of three members to
assume the powers and functions of the President; and to recommend him
to the NPUM for consideration as Associate Director for Secondary
Education.4
On January 28, 2003, the petitioner was handed inside the NPUM office a
letter, together with a copy of the minutes of the special meeting held the
previous day. In turn, he handed to Chairman Dayson a letter requesting
two weeks within which to seek a reconsideration, stating that he needed
time to obtain supporting documents because he was then attending to his
dying mother.5
In the evening of January 28, 2003, the Board of Trustees, most of whose
members had not yet left Cavite, reconvened to consider and decide the
petitioners request for reconsideration. During the meeting, he made an
emotional appeal to allow him to continue as President, promising to
immediately vacate his office should he again commit any of the
irregularities cited in the auditors report. He added that should the Board
of Trustees not favor his appeal, he would settle for a retirement package
for him and his wife and would leave the church.
The Board of Trustees denied the petitioners request for reconsideration
because his reasons were not meritorious. Board Member Elizabeth Role
served the notice of the denial on him the next day, but he refused to
receive the notice, simply saying Alam ko na yan.6
The petitioner later obtained a copy of the inter-school memorandum
dated January 31, 2003 informing AUP students, staff, and faculty members
about his relief as President and the appointment of an interim committee
to assume the powers and duties of the President.
On February 4, 2003, the petitioner brought his suit for injunction and
damages in the RTC, with prayer for the issuance of a temporary
restraining order (TRO), impleading AUP and its Board of Trustees,
represented by Chairman Dayson, and the interim committee. His
complaint alleged that the Board of Trustees had relieved him as President
without valid grounds despite his five-year term; that the Board of Trustees
had thereby acted in bad faith; and that his being denied ample and
reasonable time to present his evidence deprived him of his right to due
process.7
The suit being intra-corporate and summary in nature, the application for
TRO was heard by means of affidavits. In the hearing of February 7, 2003,
the parties agreed not to harass each other. The RTC used the mutual
agreement as its basis to issue a status quo order on February 11, 2003. 8
In their answer with counterclaim, the respondents denied the allegations
of the petitioner, and averred that he had been validly removed for cause;
and that he had been granted ample opportunity to be heard in his
defense.9
Order of the RTC
On March 21, 2003, after summary hearing, the RTC issued the TRO
enjoining the respondents and persons acting for and in their behalf from
implementing the resolution removing him as President issued by the
Board of Trustees during the January 27, 2003 special meeting, and
enjoining the interim committee from performing the functions of
President of AUP. The RTC did not require a bond. 10
After further hearing, the RTC issued on April 25, 2003 its controversial
order,11 granting the petitioners application for a writ of preliminary
injunction. It thereby resolved three issues, namely: (a) whether the special
board meetings were valid; (b) whether the conflict-of-interest provision in
the By-Laws and Working Policy was violated; and (c) whether the
petitioner was denied due process. It found for the petitioner upon all the
issues. On the first issue, it held that there was neither a written request
made by any two members of the Board of Trustees nor proper notices
sent
to the members as required by AUPs By-Laws, which omissions, being
patent defects, tainted the special board meetings with nullity. Anent the
second issue, it ruled that the purchase of coco lumber from his balae (i.e.,
mother-in-law of his son) was not covered by the conflict-of-interest
provision, for AUPs Model Statement of Acceptance form mentioned only
the members of the immediate family and did not extend to the
relationship between him and his balae. On the third issue, it concluded
that he was deprived of due process when the Board of Trustees refused to
grant his motion for reconsideration and his request for additional time to
produce his evidence, and instead immediately implemented its decision
by relieving him from his position without according him the treatment
befitting a university President.
Proceedings in the CA
With the Interim Rules for Intra-Corporate Controversies prohibiting a
motion for reconsideration, the respondents forthwith filed a petition for
certiorari in the CA,12 contending that the petitioners complaint did not
meet the requirement that an injunctive writ should be anchored on a legal
right; and that he had been merely appointed, not elected, as President for
a term of office of only two years, not five years, based on AUPs amended
By-Laws.
In the meanwhile, on September 17, 2003, the petitioner filed a
supplemental petition in the CA,13 alleging that after the commencement
of his action, he filed in the RTC an urgent motion for the issuance of a
second TRO to enjoin the holding of an AUP membership meeting and the
election of a new Board of Trustees, capitalizing on the admission in the
respondents answer that he had been elected in 2001 to a five-year term
of office. He argued that the admission estopped the respondents from
insisting to the contrary.
The respondents filed in the CA a verified urgent motion for a TRO and to
set a hearing on the application for preliminary injunction to enjoin the RTC
from implementing the assailed order granting a writ of preliminary
injunction and from further proceeding in the case. The petitioner opposed
the motion for TRO, but did not object to the scheduling of preliminary
injunctive hearings.
On February 24, 2004, the CA issued a TRO to enjoin the RTC from
proceeding for a period of 60 days, and declared that the prayer for
injunctive relief would be resolved along with the merits of the main case.
The petitioner sought a clarification of the TRO issued by the CA,
considering that his cause of action in his petitions to cite the respondents
in indirect contempt dated March 5, 2004 and March 16, 2004 filed in the
RTC involved the election of a certain Robin Saban as the new President of
AUP in blatant and malicious violation of the writ of preliminary injunction
issued by the RTC. In clarifying the TRO, the CA explained that it did not go
beyond the reliefs prayed for in the respondents motion for TRO and
preliminary injunctive hearings.
On August 5, 2004, the CA rendered its decision nullifying the RTCs writ of
preliminary injunction. It rejected the petitioners argument that Article IV,
Section 3 of AUPs Constitution and By-Laws and Working Policy of the
Conference provided a five-year term for him, because the provision was
inexistent. It ruled that the petitioners term of office had expired on
January 22, 2003, or two years from his appointment, based on AUPs
amended By-Laws; that, consequently, he had been a mere de facto officer
appointed by the members of the Board of Trustees; and that he held no
legal right warranting the issuance of the writ of preliminary injunction.
The CA declared that the rule on judicial admissions admitted of
exceptions, as held in National Power Corporation v. Court of Appeals,14
where the Court held that admissions were not evidence that prevailed
over documentary proof; that the petitioners being able to answer the
results of the special audit point-by-point belied his allegation of denial of
due process; that AUP was the party that stood to be injured by the
issuance of the injunctive writ in the form of a "demoralized
administration, studentry, faculty and staff, sullied reputation, and
dishonest leadership;" and that the assailed RTC order sowed confusion
and chaos because the RTC thereby chose to subordinate the interest of
the entire AUP community to that of the petitioner who had been deemed
not to have satisfied the highest ideals required of his office.
VI.
The petitioner argues that the assailed RTC order, being supported by
substantial evidence, accorded with law and jurisprudence; that his tenure
as President under the Constitution, By-Laws and the Working Policy of the
Conference was for five years, contrary to the CAs findings that he held
the position in a hold-over capacity; that instead, the CA should have
applied the rule on judicial admission, because the holding in National
Power Corporation v. Court of Appeals, cited by the CA, did not apply, due
to AUP not having presented competent evidence to prove that he had not
been elected by the Board of Trustees as President of AUP; and that his
removal during the special board meeting that was invalidly held for lack of
notice denied him due process.
AUP counters that:
I.
II.
Issues
Undeterred, the petitioner has appealed, contending that:
I.
II.
III.
IV.
V.
III.
IV.
V.
The decisive question is whether the CA correctly ruled that the petitioner
had no legal right to the position of President of AUP that could be
protected by the injunctive writ issued by the RTC.
Ruling
We deny the petition for review for lack of merit.
1.
The injunctive writ issued by the RTC was meant to protect the petitioners
right to stay in office as President. Given that the lifetime of the writ of
preliminary injunction was co-extensive with the duration of the act sought
to be prohibited,15 this injunctive relief already became moot in the face of
the admission by the petitioner himself, through his affidavit,16 that his
term of office premised on his alleged five-year tenure as President had
lasted only until December 2005. In short, the injunctive writ granted by
the RTC had expired upon the end of the term of office (as posited by him).
The mootness of the petition warranted its denial. When the resolution of
the issue submitted in a case has become moot and academic, and the
prayer of the complaint or petition, even if granted, has become impossible
of enforcement for there is nothing more to enjoin the case should be
dismissed.17 No useful purpose would then be served by passing on the
merits of the petition, because any ruling could hardly be of any practical
or useful purpose in the premises. It is a settled rule that a court will not
determine a moot question or an abstract proposition, nor express an
opinion in a case in which no practical relief can be granted. 18 Indeed, moot
and academic cases cease to present any justiciable controversies by virtue
of supervening events,19 and the courts of law will not determine moot
questions,20 for the courts should not engage in academic declarations and
determine a moot question.21
2.
Nonetheless, the aspect of the case concerning the petitioners claim for
damages has still to be decided. It is for this reason that we have to resolve
whether or not the petitioner had a right to the TRO and the injunctive writ
issued by the RTC.
A valid writ of preliminary injunction rests on the weight of evidence
submitted by the plaintiff establishing: (a) a present and unmistakable right
to be protected; (b) the acts against which the injunction is directed violate
such right; and (c) a special and paramount necessity for the writ to
prevent serious damages.22 In the absence of a clear legal right, the
issuance of the injunctive writ constitutes grave abuse of discretion23 and
will result to nullification thereof. Where the complainants right is
doubtful or disputed, injunction is not proper. The possibility of irreparable
damage sans proof of an actual existing right is not a ground for a
preliminary injunction.24
It is clear to us, based on the foregoing principles guiding the issuance of
the TRO and the writ of injunction, that the issuance of the assailed order
constituted patently grave abuse of discretion on the part of the RTC, and
that the CA rightly set aside the order of the RTC.
To begin with, the petitioner rested his claim for injunction mainly upon his
representation that he was entitled to serve for five years as President of
AUP under the Constitution, By-Laws and Working Policy of the General
Conference of the Seventh Day Adventists (otherwise called the Bluebook).
All that he presented in that regard, however, were mere photocopies of
pages 225-226 of the Bluebook, which read:
Article IV-Board of Directors
Sec. 1. This school operated by the _____________ Union
Conference/Mission of Seventh-Day Adventists shall be under the direct
The petitioner complains that he was denied due process because he was
deprived of the right to be heard and to seek reconsideration; and that the
proceedings of the Board of Trustees were illegal due to its members not
being properly notified of the meeting.
As culled from the records, the facts show that on 26 February 1999,
respondents RJ Ventures Realty & Development Corporation (RJVRD) and
Rajah Broadcasting Network, Inc. (RBN) filed a Complaint for Injunction
with Prayer for Issuance of Temporary Restraining Order and Writ of
Preliminary Injunction4 against petitioner PNB and Juan S. Baun, Jr.5 with
the Regional Trial Court (RTC), Branch 66 of Makati City, and docketed as
Civil Case No. 99-452.
The Antecedents
work injustice to RJVRD and RBN. They manifested their willingness to post
a bond as the court a quo may fix in its discretion, to answer for whatever
damages PNB may sustain for the reason of the restraining order or
injunction, if finally determined that respondents are not entitled thereto.
On 25 January 1999, PNB, through its counsel, sent RBN a demand letter,
requiring the latter to settle their outstanding account of
P841,460,891.91.32 In a letter similarly dated 25 January 1999, PNB by
counsel, demanded from RJVRD the settlement of its total obligation of
P5,405,301,470.82.33 On 28 January 1999, RBN sent a letter to PNB's
counsel, expressing its surprise to receive the demand letter despite their
continuing negotiations with PNB for the restructuring of its accounts. In its
letter, RBN said that it was, in fact, required by PNB to redenominate its
dollar loans into pesos as an initial step for the restructuring of the
account, and which it has complied.35 On even date, RJVRD sent a letter to
PNB's counsel emphasizing that it had not been advised of any adverse
development in their negotiation with PNB nor had it been informed of the
discontinuance of the negotiation. RJVRD sought for additional time to
justify its proposal to PNB with the aim of arriving at a friendly settlement.
Acting on the Motion, the Court of Appeals, rendered the assailed Decision
dated 31 March 2004, denying the same. In the same order, the appellate
court, reversed and set aside the Orders dated 28 July 1999 and 26 October
1999 of the RTC; hence, effectively reinstating the Writ of Preliminary
Injunction earlier issued on 28 May 1999. The Court of Appeals held that
the RTC was not asked to make a definitive conclusion on the issue of
whether RBN was indeed guilty of default in paying its loan nor was it
asked to resolve whether RBN committed a breach against PNB which
necessitated foreclosure. A determination of whether there was default or
breach can be only be reached after the principal action is set for trial on
the merits after the parties are given opportunity to present evidence in
support of their respective claims.
The appellate court decreed, to wit:
It must be emphasized that a preliminary injunction may be granted
at any stage of an action prior to final judgment, requiring a person
to refrain from a particular act. As the term itself suggests, it is
merely temporary, subject to the final disposition of the principal
action. The justification for the preliminary injunction is urgency. It is
based on evidence tending to show that the action complained of
must be stayed lest the movant suffer irreparable injury or the final
judgment granting the relief sought become ineffectual. Necessarily,
that evidence need only be a "sampling," as it were, and intended
merely to give the court an idea of the justification for the preliminary
injunction pending the decision of the case on the merits. The
evidence submitted at the hearing on the motion for preliminary
injunction is not conclusive of the principal action, which has yet to
be decided. (Olalia vs. Hizon, 196 SCRA 665 [1991]).
Anent the issue of whether RBN would sustain "irreparable injury"
should the chattel mortgage be foreclosed, it bears repeating that
the evidence to be submitted at the hearing on the motion for
preliminary injunction need not be conclusive and complete. On this
score, We find petitioners to have sufficiently established the
existence of irreparable injury to justify, albeit provisionally, the
restraint of the act complained against them.
We find that the potential injury demonstrated by the various
testimonies presented by petitioners more than satisfies the legal
and jurisprudential requirements of "irreparable injury." There is no
gainsaying in that the foreclosure of the subject radio equipment[s]
would inevitably result in stoppage of operations. This, in turn, shall
result to (sic) the station's tarnished image and consequent loss of
public listenership. Loss of listenership then leads to loss of
confidence of the station's patrons and advertising clients that would
cause serious repercussions on its ability to sustain its operations.
Undoubtedly, the loss of image and reputation by a radio station are
matters that are not quantifiable in terms of monetary value.
All told, We find the court a quo's lifting of the injunction earlier
issued tainted with grave abuse of discretion properly correctable by
the special writ of certiorari.
On 4 May 2004, PNB moved for the reconsideration thereon. On 8 July
2004, the Court of Appeals rendered a Resolution, finding no justification
to compel a modification or reversal of the 31 March 2004 Decision.
Hence, the instant Petition.
The Issues
(b)
II.
III.
IV.
V.
The pivotal issue in the instant Petition is whether the Court of Appeals
correctly reinstated the Writ of Preliminary Injunction dated 28 May 1999.
Hence, the question is whether respondents RJVRD and RBN are entitled to
the Writ of Preliminary Injunction. It is for this reason that we shall address
and concern ourselves only with the assailed writ, but not with the merits
of the case pending before the trial court. A preliminary injunction is
merely a provisional remedy, adjunct to the main case subject to the
latter's outcome.62 It is not a cause of action in itself.
This Petition has no merit.
Foremost, we reiterate that the sole object of a preliminary injunction is to
maintain the status quo until the merits can be heard. 64 A preliminary
injunction65 is an order granted at any stage of an action prior to judgment
of final order, requiring a party, court, agency, or person to refrain from a
particular act or acts. It is a preservative remedy to ensure the protection
of a party's substantive rights or interests pending the final judgment in the
principal action. A plea for an injunctive writ lies upon the existence of a
claimed emergency or extraordinary situation which should be avoided for
otherwise, the outcome of a litigation would be useless as far as the party
applying for the writ is concerned.66
The grounds for the issuance of a Writ of Preliminary Injunction are
prescribed in Section 3 of Rule 58 of the Rules of Court. Thus:
SEC. 3. Grounds for issuance of preliminary injunction. A
preliminary injunction may be granted when it is established:
(a)
(c)
this ground by raising the argument that there is, in actuality, a pecuniary
standard by which RBN's damage can be measured, as evidenced by the
testimony of RBN's witness that it will suffer a loss of P1.2 Billion for the
next ten (10) years.
To be sure, this court has declared that the term irreparable injury has a
definite meaning in law. It does not have reference to the amount of
damages that may be caused but rather to the difficulty of measuring the
damages inflicted. If full compensation can be obtained by way of
damages, equity will not apply the remedy of injunction.76 The Court of
Appeals declared that the evidence adduced by respondents more than
satisfies the legal and jurisprudential requirements of irreparable injury. It
behooves this court to appreciate the unique character of the collaterals
that stand to be affected should the Writ of Preliminary Injunction be
dissolved as PNB would have it. The direct and inevitable result would be
the stoppage of the operations of respondents' radio stations,
consequently, losing its listenership, and tarnishing the image that it has
built over time. It does not stretch one's imagination to see that the cost of
a destroyed image is significantly the loss of its good name and reputation.
As aptly appreciated by the appellate court, the value of a radio station's
image and reputation are not quantifiable in terms of monetary value. This
conclusion can be gleaned from the testimony of respondents' witness,
Jose E. Escaner, Jr., General Manager of RBN, thus:
Atty. Mendoza:
Q: Now, in your forty (40) years in the broadcast (sic) industry, have
you had any personal experience in (sic) any actual interruption in
the operations of a radio station programming?
Witness:
A: Yes, when I was handling the network of the then Ambassador
Nanding Cojuanco within which the radio stations were sequestered
and sometime or the other it (sic) went off the air and immediately,
we do not have any revenues, so much so that we actually suffered
two (2) to three (3) years.
Atty. Mendoza:
Q: And how long did it take for that station in Cebu that you
mentioned to retain its listenership day? (sic)
Witness:
A: Well, honestly, until now its airtime, because of its image, status
image (sic) which is the reputation of an AM Station while they are
still recouping other stations, the other reports came over (sic) and
practically brought their ratings down, so, until now they still have to
recoup.
Atty. Mendoza:
Q: What radio station are you referring to?
Witness:
A: DYRB.
Atty. Mendoza:
Q: What would be the consequence if the radio stations of RBN stops
(sic) operation (sic)?
Witness:
A: It will lose whatever image it has generated to this point and (sic)
time, it will cost irreparable damage not only to its operation but
most of all (sic) its image as being built by RNB. Rajah Broadcasting
Network and I doubt very much if it will still be able to recoup to a
very good result, what we are now generating.
Atty. Mendoza:
That is all for the witness, Your Honor.
COURT:
Alright (sic), cross.
Atty. dela Vega:
With the permission of the Honorable Court.
the Rules of Court, assailing the 22 September 2005 Decision 1 of the Court
of Appeals in CA-G.R. SP No. 87702, which affirmed the Order2 dated 30
September 2004, of the Regional Trial Court (RTC), Pasay City, Branch 117,
in Civil Case No. 04-0415-CFM. The RTC granted the issuance of a writ of
preliminary injunction restraining OWWA from implementing its new
organizational structure.
Witness:
A: Still it will.
Atty. dela vega:
Q: In what way?
Witness:
A: Because that will have an effect now on our relation with our
clientele. The image will be doubt (sic). The will be doubt, there be
vacillation in the planning of the media plans, vacillation in the
buying of airtime.
Atty. dela Vega:
Q It will affect?
Witness:
A: It will affect. The confidence is there.
xxxx
Atty. dela Vega:
Q: Based from (sic) your experienced (sic) as the person engaged in
media practice Mr. Witness, with respect to the possession, let us go
to the heart of the matter as of this point and time.
COURT:
You shoot the question straight.
Atty. dela Vega:
Yes, Your Honor.
(continuing to (sic) the witness
Q Will it made a difference to the operations of a radio station and
relation with the listeners and their clients if technical equipments, in
(sic) the technical equipments, the ownership over the sale are
transferred to another person?
Witness:
A: If you take the equipment immediately that would mean stopping
our operations. That would mean stopping our day to day
communication with our listenership. That they will be wondering,
that will cost damage and (sic) our image immediately. That will cost
damage to our contracts right now without keeping with our clients.
Atty. dela Vega:
Q: Usually that person who owns that particular equipment will get
the particular equipment. When you say get, what do you mean by
get Mr. Witness?
Witness:
A: If for instance was what we are talking about right now, you are
going to foreclose, ok, (sic), what will we use?
DECISION
Atty. dela Vega:
Q: Assuming Mr. Witness, that the creditor of Rajah Broadcasting
Network will not get, will not get the equipment, will not get their
account, will it adversely affect the operations of Rajah Broadcating?
Factual Antecedents
CHICO-NAZARIO, J.:
The Case
Petitioner Overseas Workers Welfare Administration (OWWA), comes to
this Court via the instant Petition for Review on Certiorari under Rule 45 of
3.
4.
5.
The Placement Committee should complete its task not later than June 30,
2004.
(b)
(c)
informed Gothong Lines in a letter dated 18 June 1998 that they would no
longer push through with their offer to sell the remaining lots.
On 6 July 1998, Gothong Lines filed a complaint for Specific Performance,
Damages with Writ of Preliminary Mandatory Injunction against the
Spouses Dungog to enforce the Contract. Gothong Lines faulted the
Spouses Dungog for non-delivery of some of the parcels of land in breach
of the Contract. Gothong Lines alleged that while the total amount of
P51,248,348.26 paid to the Spouses Dungog corresponds to 102,496.69
square meters, the Spouses Dungog actually delivered to Gothong Lines
only 100,613.69 square meters. Gothong Lines claimed that it paid an
excess of P941,848.007 corresponding to 1,883 square meters. To protect
its interest, Gothong Lines ordered the bank to stop payment on the
remaining postdated checks. Gothong Lines asked the trial court to issue a
writ of preliminary injunction to restrain the Spouses Dungog from
canceling the Contract and from preventing its representatives and vehicles
from passing through the properties subject of the Contract. Gothong Lines
offered to post a bond of P500,000.00 and consigned the P4,048,950.00
representing the balance of the purchase price.
Traversing Gothong Lines allegations, the Spouses Dungog contended that
it was Gothong Lines which breached the Contract by stopping payment on
the last 4 checks. The Spouses Dungog also charged Gothong Lines with
competing with them in acquiring one of the lots subject of the Contract.
They further countered that Gothong Lines violated a verbal agreement
between them not to develop the roads until after 30 June 1998, the last
day for the Spouses Dungog to deliver and turn over the lots. The Spouses
Dungog opposed Gothong Lines application for a writ of preliminary
injunction on the ground that Gothong Lines violated the terms of the
Contract and the other contemporaneous agreements between them.
Based on the pleadings and affidavits presented by the parties, the trial
court granted on 14 August 1998 Gothong Lines prayer for injunction. The
dispositive portion of the Order reads:
WHEREFORE, in the light of the foregoing considerations, plaintiffs
application for the issuance of a writ of preliminary injunction is GRANTED.
Consequently, after the filing and approval of a bond in the amount of
Three Hundred Thousand Pesos (P300,000.00), let a writ of preliminary
injunction issue, enjoining defendants, their representatives, or anyone
acting in their behalf; (a) from canceling the contract to sell dated
December 31, 1996; and (b) from disallowing or preventing the entry and
exit of plaintiffs vehicles and those of its representatives through Lot 1031F and other undelivered lots concerned.8
Based on this Order, the trial court issued the Writ on 18 August 1998
which the sheriff served on the same date.
Felipe assailed the Order and the Writ in a special civil action for certiorari
before the Court of Appeals. The appellate court, however, dismissed
outright Felipes petition. The appellate court also denied on 24 August
1999 Felipes motion for reconsideration. Thus, Felipe filed the instant
petition questioning the propriety of the writ of preliminary injunction
issued by the trial court.
The Rulings of the Trial Court and the Court of Appeals
In granting the Writ, the trial court stated -
There is no dispute that plaintiff has already paid defendants the amount
of P51,248,348.26 out of the total consideration of P65,520,475.00.
Plaintiff has also deposited with the Office of the Clerk of Court the amount
of P4,048,950.00, leaving a balance of P10,223,176.74.
Plaintiff had already started the road development in the properties
delivered to it. In other words, it has already spent much to develop the
properties which form the bulk of the parcels of land subject of the
contract.
Ingress to and egress from plaintiffs development activities lie on an
undelivered parcel of land. Through it pass the vehicles, equipment,
supplies and materials, as well as the workers, required by the project. The
closure of this passage has apparently stymied the development in the
area.
About 78% of the properties are in the hands of plaintiff. Access to these
properties is under the control of defendants, the entrance being located
in Lot 1031-F, one of the remaining undelivered lots. Since the entrance
gate has been closed by defendants, it strikes the mind of the court that
Lot 1031-F and the other undelivered lots have now, in a manner of
speaking, imprisoned the delivered properties.
It is not therefore hard to see that the closure of the entrance gate has
worked to the prejudice of plaintiff and will certainly jeopardize the
development work in the delivered properties. Elementary justice and the
spirit of fair play thus dictate that the status quo ante, which is the
situation before the closure when plaintiffs representatives were able to
pass through Lot 1031-F, be restored.
Insofar as defendants threatened cancellation of the contract to sell, the
Court has seen that out of the total area of 131,040.95 square meters
covered by the contract, plaintiff had already paid for 102,496.69 square
meters, and that it had deposited P4,048,950.00 to pay for some of the
undelivered parcels. It is but fair that such a move be, in the meantime,
disallowed.9
In dismissing outright Felipes petition for certiorari, prohibition and
mandamus assailing the trial courts Order and the Writ, the Court of
Appeals stated The petition should be dismissed outright, the petitioner has no standing
here. He may be the owner of the lot in question but he is not a party
litigant in the case a quo. His being a son of defendant spouse in the lower
court does not give him the capacity to sue. Of course, he is not without
legal remedy to protect his interest. 10
The Issue
In his Memorandum, Felipe narrows the inquiry to MAY PETITIONER BE DEPRIVED OF HIS PROPERTY WITHOUT DUE PROCESS
OF LAW AND PAYMENT OF JUST COMPENSATION FOR THE BENEFIT OF
PRIVATE RESPONDENT?11
Felipe laments that the dismissal of his petition resulted in the outright
confiscation of his property for the private use of Gothong Lines, without
due process of law and just compensation. Felipe claims that in dismissing
his petition, the Court of Appeals effectively sustained the trial courts
Order divesting him of his rights over Lot 1031-F.
The question of whether Gothong Lines may demand the turn over of the
parcels of land listed in Annex "A" of the Contract is not our concern here.
The issue in this petition is whether the Court of Appeals erred in
dismissing Felipes petition.
existed prior to the filing of the case. We agree with the trial court that the
status quo should be maintained until the issue on the parties respective
rights and obligations under the Contract is determined after the trial.
Clearly, in issuing the Writ, the trial court did not forthwith deprive Felipe
of his ownership of Lot 1031-F. Neither did the Writ have the effect of
ousting Felipe from possession of the lot. The trial court did not rule on the
merits of the case so as to amount to a deprivation or confiscation of
property without due process of law or just compensation. There was no
adjudication on the rightful possession or ownership of the contested
parcels of land subject of the Contract. The trial court issued the injunction
only as a preventive remedy to protect during the pendency of the action
Gothong Lines right to a final and effective relief.
WHEREFORE, the petition is DENIED for lack of merit. SO ORDERED.
G.R. No. 131719
May 25, 2004
THE EXECUTIVE SECRETARY, THE SECRETARY OF JUSTICE, THE SECRETARY
OF LABOR AND EMPLOYMENT, AND THE SECRETARY OF FOREIGN
AFFAIRS, OWWA PUNO, ADMINISTRATOR, and POEA ADMINISTRATOR,
petitioners, vs. THE HON. COURT OF APPEALS and ASIAN RECRUITMENT
COUNCIL PHILIPPINE CHAPTER (ARCO-PHIL.), INC., representing its
members: Worldcare Services Internationale, Inc., Steadfast
International Recruitment Corporation, Dragon International Manpower
Services Corporation, Verdant Manpower Mobilization Corporation,
Brent Overseas Personnel, Inc., ARL Manpower Services, Inc., Dahlzhen
International Services, Inc., Interworld Placement Center, Inc., Lakas Tao
Contract Services, Ltd. Co., and SSC Multiservices, respondents.
DECISION
CALLEJO, SR., J.:
In this petition for review on certiorari, the Executive Secretary of the
President of the Philippines, the Secretary of Justice, the Secretary of
Foreign Affairs, the Secretary of Labor and Employment, the POEA
Administrator and the OWWA Administrator, through the Office of the
Solicitor General, assail the Decision1 of the Court of Appeals in CA-G.R. SP
No. 38815 affirming the Order2 of the Regional Trial Court of Quezon City
dated August 21, 1995 in Civil Case No. Q-95-24401, granting the plea of
the petitioners therein for a writ of preliminary injunction and of the writ
of preliminary injunction issued by the trial court on August 24, 1995.
The Antecedents
Republic Act No. 8042, otherwise known as the Migrant Workers and
Overseas Filipinos Act of 1995, took effect on July 15, 1995. The Omnibus
Rules and Regulations Implementing the Migrant Workers and Overseas
Filipino Act of 1995 was, thereafter, published in the April 7, 1996 issue of
the Manila Bulletin. However, even before the law took effect, the Asian
Recruitment Council Philippine Chapter, Inc. (ARCO-Phil.) filed, on July 17,
1995, a petition for declaratory relief under Rule 63 of the Rules of Court
with the Regional Trial Court of Quezon City to declare as unconstitutional
Section 2, paragraph (g), Section 6, paragraphs (a) to (j), (l) and (m), Section
7, paragraphs (a) and (b), and Sections 9 and 10 of the law, with a plea for
the issuance of a temporary restraining order and/or writ of preliminary
injunction enjoining the respondents therein from enforcing the assailed
provisions of the law.
In a supplement to its petition, the ARCO-Phil. alleged that Rep. Act No.
8042 was self-executory and that no implementing rules were needed. It
prayed that the court issue a temporary restraining order to enjoin the
enforcement of Section 6, paragraphs (a) to (m) on illegal recruitment,
Section 7 on penalties for illegal recruitment, and Section 9 on venue of
criminal actions for illegal recruitments, viz:
Viewed in the light of the foregoing discussions, there appears to be
urgent an imperative need for this Honorable Court to maintain the
status quo by enjoining the implementation or effectivity of the
questioned provisions of RA 8042, by way of a restraining order
otherwise, the member recruitment agencies of the petitioner will
suffer grave or irreparable damage or injury. With the effectivity of
RA 8042, a great majority of the duly licensed recruitment agencies
have stopped or suspended their operations for fear of being
prosecuted under the provisions of a law that are unjust and
unconstitutional. This Honorable Court may take judicial notice of the
fact that processing of deployment papers of overseas workers for
the past weeks have come to a standstill at the POEA and this has
affected thousands of workers everyday just because of the
enactment of RA 8042. Indeed, this has far reaching effects not only
to survival of the overseas manpower supply industry and the active
participating recruitment agencies, the countrys economy which has
survived mainly due to the dollar remittances of the overseas
workers but more importantly, to the poor and the needy who are in
dire need of income-generating jobs which can only be obtained
from abroad. The loss or injury that the recruitment agencies will
suffer will then be immeasurable and irreparable. As of now, even
foreign employers have already reduced their manpower
requirements from the Philippines due to their knowledge that RA
8042 prejudiced and adversely affected the local recruitment
agencies.3
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
SEC. 7. Penalties.
(a) Any person found guilty of illegal recruitment shall suffer the
penalty of imprisonment of not less than six (6) years and one (1) day
but not more than twelve (12) years and a fine of not less than two
hundred thousand pesos (P200,000.00) nor more than five hundred
thousand pesos (P500,000.00).
(b) The penalty of life imprisonment and a fine of not less than five
hundred thousand pesos (P500,000.00) nor more than one million
pesos (P1,000,000.00) shall be imposed if illegal recruitment
constitutes economic sabotage as defined herein.
Provided, however, That the maximum penalty shall be imposed if
the person illegally recruited is less than eighteen (18) years of age or
committed by a non-licensee or non-holder of authority.
Sec. 8.
Prohibition on Officials and Employees. It shall be unlawful for any
official or employee of the Department of Labor and Employment,
the Philippine Overseas Employment Administration (POEA), or the
Overseas Workers Welfare Administration (OWWA), or the
Department of Foreign Affairs, or other government agencies
involved in the implementation of this Act, or their relatives within
the fourth civil degree of consanguinity or affinity, to engage, directly
or indirectly, in the business of recruiting migrant workers as defined
in this Act. The penalties provided in the immediate preceding
paragraph shall be imposed upon them. (underscoring supplied)
The petitioners filed a petition for certiorari with the Court of Appeals
assailing the order and the writ of preliminary injunction issued by the trial
court on the following grounds:
1.
2.
The petitioners asserted that the respondent is not the real party-ininterest as petitioner in the trial court. It is inconceivable how the
respondent, a non-stock and non-profit corporation, could sustain direct
injury as a result of the enforcement of the law. They argued that if, at all,
any damage would result in the implementation of the law, it is the
licensed and registered recruitment agencies and/or the unskilled Filipino
migrant workers discriminated against who would sustain the said injury or
damage, not the respondent. The respondent, as petitioner in the trial
court, was burdened to adduce preponderant evidence of such irreparable
injury, but failed to do so. The petitioners further insisted that the petition
a quo was premature since the rules and regulations implementing the law
had yet to be promulgated when such petition was filed. Finally, the
petitioners averred that the respondent failed to establish the requisites
for the issuance of a writ of preliminary injunction against the enforcement
of the law and the rules and regulations issued implementing the same.
On December 5, 1997, the appellate court came out with a four-page
decision dismissing the petition and affirming the assailed order and writ of
preliminary injunction issued by the trial court. The appellate court,
likewise, denied the petitioners motion for reconsideration of the said
decision.
The petitioners now come to this Court in a petition for review on certiorari
on the following grounds:
1.
2.
enforcement of Rep. Act No. 8042, pendente lite, would cause grave and
irreparable injury to the respondent until the case is decided on its merits.
We note, however, that since Rep. Act No. 8042 took effect on July 15,
1995, the Court had, in a catena of cases, applied the penal provisions in
Section 6, including paragraph (m) thereof, and the last two paragraphs
therein defining large scale illegal recruitment committed by officers
and/or employees of recruitment agencies by themselves and in
connivance with private individuals, and imposed the penalties provided in
Section 7 thereof, including the penalty of life imprisonment.22 The
Informations therein were filed after preliminary investigations as provided
for in Section 11 of Rep. Act No. 8042 and in venues as provided for in
Section 9 of the said act. In People v. Chowdury,23 we held that illegal
recruitment is a crime of economic sabotage and must be enforced.
In People v. Diaz,24 we held that Rep. Act No. 8042 is but an amendment of
the Labor Code of the Philippines and is not an ex-post facto law because it
is not applied retroactively. In JMM Promotion and Management, Inc. v.
Court of Appeals,25 the issue of the extent of the police power of the State
to regulate a business, profession or calling vis--vis the equal protection
clause and the non-impairment clause of the Constitution were raised and
we held, thus:
A profession, trade or calling is a property right within the meaning of
our constitutional guarantees. One cannot be deprived of the right to
work and the right to make a living because these rights are property
rights, the arbitrary and unwarranted deprivation of which normally
constitutes an actionable wrong.
Nevertheless, no right is absolute, and the proper regulation of a
profession, calling, business or trade has always been upheld as a
legitimate subject of a valid exercise of the police power by the state
particularly when their conduct affects either the execution of
legitimate governmental functions, the preservation of the State, the
public health and welfare and public morals. According to the maxim,
sic utere tuo ut alienum non laedas, it must of course be within the
legitimate range of legislative action to define the mode and manner
in which every one may so use his own property so as not to pose
injury to himself or others.
In any case, where the liberty curtailed affects at most the rights of
property, the permissible scope of regulatory measures is certainly
much wider. To pretend that licensing or accreditation requirements
violates the due process clause is to ignore the settled practice,
under the mantle of the police power, of regulating entry to the
practice of various trades or professions. Professionals leaving for
abroad are required to pass rigid written and practical exams before
they are deemed fit to practice their trade. Seamen are required to
take tests determining their seamanship. Locally, the Professional
Regulation Commission has begun to require previously licensed
doctors and other professionals to furnish documentary proof that
they had either re-trained or had undertaken continuing education
courses as a requirement for renewal of their licenses. It is not
claimed that these requirements pose an unwarranted deprivation of
a property right under the due process clause. So long as
professionals and other workers meet reasonable regulatory
standards no such deprivation exists.
Finally, it is a futile gesture on the part of petitioners to invoke the
non-impairment clause of the Constitution to support their argument
assailed order and writ of preliminary injunction. It is for this reason that
the Court issued a temporary restraining order enjoining the enforcement
of the writ of preliminary injunction issued by the trial court.
IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The assailed
decision of the appellate court is REVERSED AND SET ASIDE. The Order of
the Regional Trial Court dated August 21, 1995 in Civil Case No. Q-95-24401
and the Writ of Preliminary Injunction issued by it in the said case on
August 24, 1995 are NULLIFIED. No costs. SO ORDERED.
G.R. No. 140058
August 1, 2002
MABAYO FARMS, INC., herein represented by its President MRS.
RORAIMA SILVA, petitioner, vs. HON. COURT OF APPEALS and ANTONIO
SANTOS, respondents.
RESOLUTION
QUISUMBING, J.:
This petition for review seeks to reverse the decision1 promulgated on
August 27, 1999, of the Court of Appeals in CA-G.R. SP No. 51375. The
appellate court enjoined the enforcement of the writ of preliminary
injunction dated April 14, 1998, issued by the Regional Trial Court of
Balanga, Bataan, Branch 1, in Civil Case No. 6695 against private
respondent, Antonio Santos.
The factual antecedents of this case are as follows:
On August 22, 1969, the Bureau of Lands declared Francisco Domingo,
Reynaldo Florida, Cornelio Pilipino and Severino Vistan, lawful possessors
of Lot 1379 of the Morong, Bataan Cadastre. Lot 1379 consists of 144
hectares. Domingo, Florida, Pilipino and Vistan through their forebears and
by themselves had been in open, notorious, and exclusive possession of
portions of Lot 1379 since 1933 in the concept of owners. The Bureau then
directed them to confirm their titles over the property by filing the
appropriate applications for the portions of the property respectively
occupied by them.1wphi1.nt
In October 1970, petitioner bought the respective portions of Domingo,
Florida, Pilipino and Vistan, totaling 69,932 square meters and entered into
a compromise settlement with six other persons occupying the property,
whose applications had been rejected by the Bureau. Petitioner then filed
an application for land registration docketed as LRC Cad. Rec. No. N-209
with the then Court of First Instance of Bataan, Branch 1. The application
was contested by several oppositors, among them the heirs of one Toribio
Alejandro.
On December 20, 1991, the trial court decided the land registration case in
petitioners favor. The losing parties appealed to the Court of Appeals,
where the case was docketed as CA-G.R. CV No. 40452. On March 14, 2000,
the appellate court affirmed the lower courts decision. 2
In June 1997, a group of occupants entered the land, destroyed the fences
and drove away livestock owned by petitioner.
On October 9, 1997, petitioner filed a complaint for injunction with
damages, with a prayer for a temporary restraining order, docketed as Civil
Case No. 6695, with the RTC of Balanga, Bataan. Named as defendants
were Juanito Infante, Domingo Infante, Lito Mangalidan, Jaime Aquino,
John Doe, Peter Doe, and Richard Doe.
The trial court issued the temporary restraining order (TRO) and on January
16, 1998, the sheriff served copies on the defendants. The sheriff
accompanied petitioners president to the property where they found five
(5) persons cultivating the land. The latter refused to give their names or
receive copies of the TRO. They claimed that they were only farm workers
of a certain Antonio Santos who allegedly owned the land.3
On April 14, 1998, the trial court issued a writ of preliminary injunction
restraining the defendants or persons acting on their behalf from entering
and cultivating the disputed property. The aforementioned writ was also
served upon respondent who was occupying a portion of Lot No. 1379. 4
On February 24, 1999, private respondent filed a special civil action for
certiorari docketed as CA-G.R. SP No. 51375 with the Court of Appeals.
Private respondent averred that he only learned about the writ of
preliminary injunction on February 16, 1999, when he secured a copy of
the order. He claimed that he was an innocent purchaser for value of the
property from Francisco, Armando, and Conchita, all surnamed Alejandro
and the injunction prevented him from using his property. He alleged that
he was not a party to Civil Case No. 6695 and that it was grave abuse of
discretion for the trial court to enforce the injunctive writ against him since
it did not have jurisdiction over him.
On August 27, 1999, the appellate court decided CA-G.R. SP No. 51375 in
private respondents favor, thus:
WHEREFORE, premises considered the instant Petition is hereby
GRANTED. Public respondent is enjoined from imposing the
questioned writ of preliminary injunction dated April 14, 199[8]
against petitioner [Santos].
SO ORDERED.
Hence, the instant petition, submitting the following issues for our
consideration:
A.
B.
We find the lone issue to be: Is private respondent bound by the writ of
preliminary injunction issued by the trial court?
First, petitioner contends that the injunctive writ of April 14, 1998 was
issued not only against all named defendants in Civil Case No. 6695, but
also against three unnamed "Does." It now argues that the "Does" in the
complaint are all those who violated its rights, including private
respondent. Petitioner asks us to note that the writ of injunction was
served not only against the defendants in Civil Case No. 6695, but also
against other persons who were seen entering and cultivating petitioners
property, including private respondent. Since the latter personally received
the injunctive order on June 5, 1998, he was already forewarned to
intervene in Civil Case No. 6695 if he had any right or interest to protect in
the disputed property. This he failed to do. Since private respondent did
not then take the opportunity to present his side, he cannot now claim that
he was denied due process when the writ was enforced against him.
In his comment, private respondent counters that he was not legally bound
nor required by law to file his pleadings in Civil Case No. 6695 as he was not
a party in said case. Likewise, he was not required to act on or protest the
Joseph Estrada from probing alleged fund irregularities in the Armed Forces
of the Philippines.[1]
On the same date, Senator Vicente C. Sotto III also filed Resolution No. 160,
directing the appropriate senate committee to conduct an inquiry, in aid
of legislation, into the alleged mismanagement of the funds and
investment portfolio of the Armed Forces Retirement and Separation
Benefits System (AFP-RSBS) xxx. [2]
The Senate President referred the two resolutions to the Committee on
Accountability of Public Officers and Investigations (Blue Ribbon
Committee) and the Committee on National Defense and Security.
During the public hearings conducted by the Senate Blue Ribbon
Committee (hereafter called the Committee), it appeared that the AFPRSBS purchased a lot in General Santos City, designated as Lot X, MR-1160,
for P10,500.00 per square meter from private respondent Atty. Nilo J.
Flaviano. However, the deed of sale filed with the Register of Deeds
indicated that the purchase price of the lot was only P3,000.00 per square
meter.
The Committee thereafter caused the service of a subpoena to respondent
Atty. Flaviano, directing him to appear and testify before it. Respondent
refused to appear at the hearing. Instead, he filed a petition for prohibition
and preliminary injunction with prayer for temporary restraining order with
the Regional Trial Court of General Santos City, Branch 23, which was
docketed as SP Civil Case No. 496.
On October 21, 1998, the trial court issued a Temporary Restraining Order
directing the Committee to CEASE and DESIST from proceeding with the
inquiry in P.S. 160 particularly in General Santos City and/or anywhere in
Region XI or Manila on matters affecting the patenting/titling and sale of
Lot X, MR-1160-D to AFP-RSBS, and from issuing subpoenas to witnesses
from Region XI, particularly from General Santos City, pending the hearing
of the petition for prohibition and injunction.[3]
On November 5, 1998, the Committee filed a motion to dismiss the
petition on the grounds of (a) lack of jurisdiction, and (b) failure to state a
valid cause of action. It further argued that the issuance of the Temporary
Restraining Order was invalid for violating the rule against ex-parte
issuance thereof; and that the same was not enforceable beyond the
territorial jurisdiction of the trial court.
On November 11, 1998, the trial court denied petitioners motion to
dismiss and granted the writ of preliminary injunction, thus:
WHEREFORE, PREMISES CONSIDERED, the motion to dismiss is DENIED, and
the WRIT OF PRELIMINARY INJUNCTION is hereby issued against
respondent. It is enjoined from enforcing its subpoenas to petitioner in
Region XI to appear and testify before it in any of its inquiry or
investigation anywhere in the Philippines regarding the acquisition by the
AFP-RSBS of Lot X, MR-1160-D, located in General Santos City. The bond of
petitioner filed on October 21, 1998, for P500,000.00 for the TRO also
serves as his bond in this injunction.
SO ORDERED.[4]
Hence, the instant petition for certiorari which was docketed as G.R. No.
136760, alleging that respondent Judge Majaducon committed grave abuse
of discretion and/or acted without or in excess of jurisdiction when he:
I.
The two petitions, namely, G.R. No. 136760 and G.R. No. 138378, were
ordered consolidated on December 11, 2000.
The issues for resolution in these joint petitions are: (a) whether or not
respondent Judge Jose Majaducon committed grave abuse of discretion
when he dismissed petitioners motion to dismiss the petition for
prohibition and issued the writ of preliminary injunction; and (b) whether
or not respondent Judge erred in convicting petitioner Pimentel of indirect
contempt of court.
On the first issue, petitioner Committee contends that courts have no
jurisdiction to restrain Congress from performing its constitutionally vested
function to conduct investigations in aid of legislation, following the
principle of separation of powers. Moreover, the petition filed by
respondent Flaviano before the trial court failed to state a cause of action
considering that the legislative inquiry did not deal with the issuance of the
patent and title to Lot X, MR-1160-D in the name of AFP-RSBS, which is well
within the courts jurisdiction, but with the anomaly in the purchase
thereof, which falls squarely within the ambit of Senate Resolutions Nos.
157[7] and 160.[8]
On the other hand, respondent Flaviano contends that the trial court may
properly intervene into investigations by Congress pursuant to the power
of judicial review vested in it by the Constitution. He avers that he has a
valid cause of action to file the petition for prohibition considering that the
Committees investigation will delve into the validity of the patenting and
titling of Lot X, MR-1160-D which, as admitted by petitioner, falls within the
competence of judicial courts. In fact, the validity of the purchase by AFPRSBS of the subject lot is already the subject of a pending action before the
Regional Trial Court of General Santos City and the Ombudsman of
Mindanao. Finally, he cites the case of Bengzon v. Senate Blue Ribbon
Committee,[9] and argues that preliminary injunction may issue in cases
pending before administrative bodies such as the Ombudsman or the
Office of the Prosecutor as long as the right to self-incrimination
guaranteed by the Bill of Rights is in danger. Furthermore, an information
against him has been filed with the Sandiganbayan.
We find for petitioner. There is grave abuse of discretion when the
respondent acts in a capricious, whimsical, arbitrary or despotic manner in
the exercise of his judgment, as when the assailed order is bereft of any
factual and legal justification.[10] In this case, the assailed resolution of
respondent Judge Majaducon was issued without legal basis.
The principle of separation of powers essentially means that legislation
belongs to Congress, execution to the Executive, and settlement of legal
controversies to the Judiciary. Each is prevented from invading the domain
of the others.[11] When the Senate Blue Ribbon Committee served
subpoena on respondent Flaviano to appear and testify before it in
connection with its investigation of the alleged misuse and
mismanagement of the AFP-RSBS funds, it did so pursuant to its authority
to conduct inquiries in aid of legislation. This is clearly provided in Article
VI, Section 21 of the Constitution, thus:
The Senate or the House of Representatives or any of its respective
committees may conduct inquiries in aid of legislation in accordance with
its duly published rules of procedure. The rights of persons appearing in or
affected by such inquiries shall be respected.
Hence, the Regional Trial Court of General Santos City, or any court for that
matter, had no authority to prohibit the Committee from requiring
respondent to appear and testify before it.
The ruling in Bengzon, cited by respondent, does not apply in this case. We
agree with petitioner Committee that the factual circumstances therein are
different from those in the case at bar. In Bengzon, no intended legislation
was involved and the subject matter of the inquiry was more within the
province of the courts rather than of the legislature. More specifically, the
investigation in the said case was an offshoot of the privilege speech of
then Senator Enrile, who urged the Senate to look into a possible violation
of the Anti-Graft and Corrupt Practices Act by the relatives of then
President Corazon Aquino, particularly Mr. Ricardo Lopa, in connection
with the alleged sale of 36 to 39 corporations belonging to Benjamin
Romualdez. On the other hand, there was in this case a clear legislative
purpose, as stated in Senate Resolution No. 160, and the appropriate
Senate Committee was directed to look into the reported misuse and
mismanagement of the AFP-RSBS funds, with the intention of enacting
appropriate legislation to protect the rights and interests of the officers
and members of the Armed Forces of the Philippines. Further, in Bengzon,
the validity of the sale of Romualdezs corporations was pending with the
Sandiganbayan when the Senate Blue Ribbon Committee decided to
conduct its investigation. In short, the issue had already been pre-empted
by the court.
In the instant case, the complaint against respondent Flaviano regarding
the anomaly in the sale of Lot X, MR-1160 was still pending before the
Office of the Ombudsman when the Committee served subpoena on him.
In other words, no court had acquired jurisdiction over the matter. Thus,
there was as yet no encroachment by the legislature into the exclusive
jurisdiction of another branch of the government. Clearly, there was no
basis for the respondent Judge to apply the ruling in Bengzon. Hence, the
denial of petitioners motion to dismiss the petition for prohibition
amounted to grave abuse of discretion.
xxx
xxx
d)
Any improper conduct tending, directly or indirectly, to
impede, obstruct, or degrade the administration of justice; x x x.
After deliberating on the parties arguments, we find that petitioner
Pimentel is not guilty of improper conduct which obstructs or degrades the
administration of justice.
Verily, it does not appear that Pimentel caused the publication in the
Philippine Star of the fact of filing of the petition for certiorari by the
Committee and the reproduction of excerpts thereof. He had no right to
choose which news articles will see print in the newspaper. Rather, it is the
publisher thereof which decides which news events will be reported in the
broadsheet. In doing so, it is allowed the widest latitude of choice as to
what items should see the light of day so long as they are relevant to a
matter of public interest, pursuant to its right of press freedom.[12]
In Spouses Bacar v. Judge De Guzman, Jr.,[13] it was held that when the law
is so elementary, not to know it or to act as if a judge does not know it,
constitutes gross ignorance of the law. In this case, there was no showing
that petitioner Pimentel, as representative of the Committee, used the
phrase to malign the trial court. Rather, it was used to express what he
believed as a violation of the basic principle of separation of powers.
Finally, the statement that respondent Judge was grossly ignorant of the
rules of law and procedure does not constitute improper conduct that
tends to impede, obstruct or degrade the administration of justice. As
correctly argued by petitioner, the phrase gross ignorance of the rules of
law and procedure is ordinarily found in administrative complaints and is a
necessary description to support a petition which seeks the annulment of
an order of a judge wherein basic legal principles are disregarded.
2.
3.
4.
5.
6.
7.
2003. After six (6) months, on 19 February 2003, the Court of Appeals
directed Philcemcor to comment on Southern Cross's Motion for
Reconsideration.34 After Philcemcor filed its Opposition35 on 13 March
2003, Southern Cross filed another set of four (4) motions for early
resolution.
Despite the efforts of Southern Cross, the Court of Appeals failed to
directly resolve the Motion for Reconsideration. Instead, on 5 June 2003, it
rendered a Decision,36 granting in part Philcemcor's petition. The appellate
court ruled that it had jurisdiction over the petition for certiorari since it
alleged grave abuse of discretion. It refused to annul the findings of the
Tariff Commission, citing the rule that factual findings of administrative
agencies are binding upon the courts and its corollary, that courts should
not interfere in matters addressed to the sound discretion and coming
under the special technical knowledge and training of such agencies.37
Nevertheless, it held that the DTI Secretary is not bound by the factual
findings of the Tariff Commission since such findings are merely
recommendatory and they fall within the ambit of the Secretary's
discretionary review. It determined that the legislative intent is to grant the
DTI Secretary the power to make a final decision on the Tariff Commission's
recommendation.38 The dispositive portion of the Decision reads:
WHEREFORE, based on the foregoing premises, petitioner's prayer to
set aside the findings of the Tariff Commission in its assailed Report
dated March 13, 2002 is DENIED. On the other hand, the assailed
April 5, 2002 Decision of the Secretary of the Department of Trade
and Industry is hereby SET ASIDE. Consequently, the case is
REMANDED to the public respondent Secretary of Department of
Trade and Industry for a final decision in accordance with RA 8800
and its Implementing Rules and Regulations.
SO ORDERED.39
On 23 June 2003, Southern Cross filed the present petition, assailing the
appellate court's Decision for departing from the accepted and usual
course of judicial proceedings, and not deciding the substantial questions
in accordance with law and jurisprudence. The petition argues in the main
that the Court of Appeals has no jurisdiction over Philcemcor's petition, the
proper remedy being a petition for review with the CTA conformably with
the SMA, and; that the factual findings of the Tariff Commission on the
existence or non-existence conditions warranting the imposition of general
safeguard measures are binding upon the DTI Secretary.
The timely filing of Southern Cross's petition before this Court necessarily
prevented the Court of Appeals Decision from becoming final.40 Yet on 25
June 2003, the DTI Secretary issued a new Decision, ruling this time that
that in light of the appellate court's Decision there was no longer any legal
impediment to his deciding Philcemcor's application for definitive
safeguard measures.41 He made a determination that, contrary to the
findings of the Tariff Commission, the local cement industry had suffered
serious injury as a result of the import surges. 42 Accordingly, he imposed a
definitive safeguard measure on the importation of gray Portland cement,
in the form of a definitive safeguard duty in the amount of P20.60/40 kg.
bag for three years on imported gray Portland Cement.43
On 7 July 2003, Southern Cross filed with the Court a "Very Urgent
Application for a Temporary Restraining Order and/or A Writ of Preliminary
Injunction" ("TRO Application"), seeking to enjoin the DTI Secretary from
enforcing his Decision of 25 June 2003 in view of the pending petition
before this Court. Philcemcor filed an opposition, claiming, among others,
that it is not this Court but the CTA that has jurisdiction over the
application under the law.
On 1 August 2003, Southern Cross filed with the CTA a Petition for Review,
assailing the DTI Secretary's 25 June 2003 Decision which imposed the
definite safeguard measure. Prescinding from this action, Philcemcor filed
with this Court a Manifestation and Motion to Dismiss in regard to
Southern Cross's petition, alleging that it deliberately and willfully resorted
to forum-shopping. It points out that Southern Cross's TRO Application
seeks to enjoin the DTI Secretary's second decision, while its Petition
before the CTA prays for the annulment of the same decision.44
In its assailed Decision, the Court of Appeals, after asserting only in brief
that it had jurisdiction over Philcemcor's Petition, discussed the issue of
whether or not the DTI Secretary is bound to adopt the negative
recommendation of the Tariff Commission on the application for safeguard
measure. The Court of Appeals maintained that it had jurisdiction over the
petition, as it alleged grave abuse of discretion on the part of the DTI
Secretary, thus:
After giving due course to Southern Cross's Petition, the Court called the
case for oral argument on 18 February 2004.46 At the oral argument,
attended by the counsel for Philcemcor and Southern Cross and the Office
of the Solicitor General, the Court simplified the issues in this wise: (i)
whether the Decision of the DTI Secretary is appealable to the CTA or the
Court of Appeals; (ii) assuming that the Court of Appeals has jurisdiction,
whether its Decision is in accordance with law; and, (iii) whether a
Temporary Restraining Order is warranted.47
During the oral arguments, counsel for Southern Cross manifested that due
to the imposition of the general safeguard measures, Southern Cross was
forced to cease operations in the Philippines in November of 2003.48
Propriety of the Temporary Restraining Order
Before the merits of the Petition, a brief comment on Southern Cross's
application for provisional relief. It sought to enjoin the DTI Secretary from
enforcing the definitive safeguard measure he imposed in his 25 June 2003
Decision. The Court did not grant the provisional relief for it would be
tantamount to enjoining the collection of taxes, a peremptory judicial act
which is traditionally frowned upon,49 unless there is a clear statutory basis
for it.50 In that regard, Section 218 of the Tax Reform Act of 1997 prohibits
any court from granting an injunction to restrain the collection of any
national internal revenue tax, fee or charge imposed by the internal
revenue code.51 A similar philosophy is expressed by Section 29 of the
SMA, which states that the filing of a petition for review before the CTA
does not stop, suspend, or otherwise toll the imposition or collection of the
appropriate tariff duties or the adoption of other appropriate safeguard
measures.52 This evinces a clear legislative intent that the imposition of
safeguard measures, despite the availability of judicial review, should not
be enjoined notwithstanding any timely appeal of the imposition.
The Forum-Shopping Issue
In the same breath, we are not convinced that the allegation of forumshopping has been duly proven, or that sanction should befall upon
Southern Cross and its counsel. The standard by Section 5, Rule 7 of the
1997 Rules of Civil Procedure in order that sanction may be had is that "the
acts of the party or his counsel clearly constitute willful and deliberate
forum shopping."53 The standard implies a malicious intent to subvert
procedural rules, and such state of mind is not evident in this case.
general, the DTI Secretary would be evaluating only one body of facts and
applying them to one set of laws. The reviewing tribunal will be called upon
to examine the same facts and the same laws, whether or not the
determination is positive or negative.
In short, if we were to rule for respondents we would be confirming the
exercise by two judicial bodies of jurisdiction over basically the same
subject matterprecisely the split-jurisdiction situation which is anathema
to the orderly administration of justice. 64 The Court cannot accept that
such was the legislative motive especially considering that the law
expressly confers on the CTA, the tribunal with the specialized competence
over tax and tariff matters, the role of judicial review without mention of
any other court that may exercise corollary or ancillary jurisdiction in
relation to the SMA. The provision refers to the Court of Appeals but only
in regard to procedural rules and dispositions of appeals from the CTA to
the Court of Appeals.65
The principle enunciated in Tejada v. Homestead Property Corporation 66 is
applicable to the case at bar:
The Court agrees with the observation of the [that] when an
administrative agency or body is conferred quasi-judicial functions,
all controversies relating to the subject matter pertaining to its
specialization are deemed to be included within the jurisdiction of
said administrative agency or body. Split jurisdiction is not favored.
Second. The interpretation of the provisions of the SMA favors vesting
untrammeled appellate jurisdiction on the CTA.
A plain reading of Section 29 of the SMA reveals that Congress did not
expressly bar the CTA from reviewing a negative determination by the DTI
Secretary nor conferred on the Court of Appeals such review authority.
Respondents note, on the other hand, that neither did the law expressly
grant to the CTA the power to review a negative determination. However,
under the clear text of the law, the CTA is vested with jurisdiction to review
the ruling of the DTI Secretary "in connection with the imposition of a
safeguard measure." Had the law been couched instead to incorporate the
phrase "the ruling imposing a safeguard measure," then respondent's claim
would have indisputable merit. Undoubtedly, the phrase "in connection
with" not only qualifies but clarifies the succeeding phrase "imposition of a
safeguard measure." As expounded later, the phrase also encompasses the
opposite or converse ruling which is the non-imposition of a safeguard
measure.
In the American case of Shaw v. Delta Air Lines, Inc.,68 the United States
Supreme Court, in interpreting a key provision of the Employee Retirement
Security Act of 1974, construed the phrase "relates to" in its normal sense
which is the same as "if it has connection with or reference to." 69 There is
no serious dispute that the phrase "in connection with" is synonymous to
"relates to" or "reference to," and that all three phrases are broadly
expansive. This is affirmed not just by jurisprudential fiat, but also the
acquired connotative meaning of "in connection with" in common
parlance. Consequently, with the use of the phrase "in connection with,"
Section 29 allows the CTA to review not only the ruling imposing a
safeguard measure, but all other rulings related or have reference to the
application for such measure.
Now, let us determine the maximum scope and reach of the phrase "in
connection with" as used in Section 29 of the SMA. A literalist reading or
linguistic survey may not satisfy. Even the US Supreme Court in New York
State Blue Cross Plans v. Travelers Ins.70 conceded that the phrases "relate
to" or "in connection with" may be extended to the farthest stretch of
indeterminacy for, universally, relations or connections are infinite and
stop nowhere.71 Thus, in the case the US High Court, examining the same
phrase of the same provision of law involved in Shaw, resorted to looking
at the statute and its objectives as the alternative to an "uncritical
literalism."72 A similar inquiry into the other provisions of the SMA is in
order to determine the scope of review accorded therein to the CTA. 73
The authority to decide on the safeguard measure is vested in the DTI
Secretary in the case of non-agricultural products, and in the Secretary of
the Department of Agriculture in the case of agricultural products.74
Section 29 is likewise explicit that only the rulings of the DTI Secretary or
the Agriculture Secretary may be reviewed by the CTA. 75 Thus, the acts of
other bodies that were granted some powers by the SMA, such as the
Tariff Commission, are not subject to direct review by the CTA.
Under the SMA, the Department Secretary concerned is authorized to
decide on several matters. Within thirty (30) days from receipt of a petition
seeking the imposition of a safeguard measure, or from the date he made
motu proprio initiation, the Secretary shall make a preliminary
determination on whether the increased imports of the product under
consideration substantially cause or threaten to cause serious injury to the
domestic industry.76 Such ruling is crucial since only upon the Secretary's
positive preliminary determination that a threat to the domestic industry
exists shall the matter be referred to the Tariff Commission for formal
investigation, this time, to determine whether the general safeguard
measure should be imposed or not.77 Pursuant to a positive preliminary
determination, the Secretary may also decide that the imposition of a
provisional safeguard measure would be warranted under Section 8 of the
SMA.78 The Secretary is also authorized to decide, after receipt of the
report of the Tariff Commission, whether or not to impose the general
safeguard measure, and if in the affirmative, what general safeguard
measures should be applied.79 Even after the general safeguard measure is
imposed, the Secretary is empowered to extend the safeguard measure,80
or terminate, reduce or modify his previous rulings on the general
safeguard measure.81
With the explicit grant of certain powers involving safeguard measures by
the SMA on the DTI Secretary, it follows that he is empowered to rule on
several issues. These are the issues which arise in connection with, or in
relation to, the imposition of a safeguard measure. They may arise at
different stages the preliminary investigation stage, the post-formal
investigation stage, or the post-safeguard measure stage yet all these
issues do become ripe for resolution because an initiatory action has been
taken seeking the imposition of a safeguard measure. It is the initiatory
action for the imposition of a safeguard measure that sets the wheels in
motion, allowing the Secretary to make successive rulings, beginning with
the preliminary determination.
Clearly, therefore, the scope and reach of the phrase "in connection with,"
as intended by Congress, pertain to all rulings of the DTI Secretary or
Agriculture Secretary which arise from the time an application or motu
proprio initiation for the imposition of a safeguard measure is taken.
Indeed, the incidents which require resolution come to the fore only
because there is an initial application or action seeking the imposition of a
safeguard measure. From the legislative standpoint, it was a matter of
sense and practicality to lump up the questions related to the initiatory
application or action for safeguard measure and to assign only one court
and; that is the CTA to initially review all the rulings related to such
initiatory application or action. Both directions Congress put in place by
employing the phrase "in connection with" in the law.
Given the relative expanse of decisions subject to judicial review by the
CTA under Section 29, we do not doubt that a negative ruling refusing to
impose a safeguard measure falls within the scope of its jurisdiction. On a
literal level, such negative ruling is "a ruling of the Secretary in connection
with the imposition of a safeguard measure," as it is one of the possible
outcomes that may result from the initial application or action for a
safeguard measure. On a more critical level, the rulings of the DTI Secretary
in connection with a safeguard measure, however diverse the outcome
may be, arise from the same grant of jurisdiction on the DTI Secretary by
the SMA.82 The refusal by the DTI Secretary to grant a safeguard measure
involves the same grant of authority, the same statutory prescriptions, and
the same degree of discretion as the imposition by the DTI Secretary of a
safeguard measure.
The position of the respondents is one of "uncritical literalism"83
incongruent with the animus of the law. Moreover, a fundamentalist
approach to Section 29 is not warranted, considering the absurdity of the
consequences.
Third. Interpretatio Talis In Ambiguis Semper Fienda Est, Ut Evitur
Inconveniens Et Absurdum.84
Even assuming arguendo that Section 29 has not expressly granted the CTA
jurisdiction to review a negative ruling of the DTI Secretary, the Court is
precluded from favoring an interpretation that would cause inconvenience
and absurdity.85 Adopting the respondents' position favoring the CTA's
minimal jurisdiction would unnecessarily lead to illogical and onerous
results.
Indeed, it is illiberal to assume that Congress had intended to provide
appellate relief to rulings imposing a safeguard measure but not to those
declining to impose the measure. Respondents might argue that the right
to relief from a negative ruling is not lost since the applicant could, as
Philcemcor did, question such ruling through a special civil action for
certiorari under Rule 65 of the 1997 Rules of Civil Procedure, in lieu of an
appeal to the CTA. Yet these two reliefs are of differing natures and
gravamen. While an appeal may be predicated on errors of fact or errors of
law, a special civil action for certiorari is grounded on grave abuse of
discretion or lack of or excess of jurisdiction on the part of the decider. For
a special civil action for certiorari to succeed, it is not enough that the
questioned act of the respondent is wrong. As the Court clarified in Sempio
v. Court of Appeals:
A tribunal, board or officer acts without jurisdiction if it/he does not
have the legal power to determine the case. There is excess of
jurisdiction where, being clothed with the power to determine the
case, the tribunal, board or officer oversteps its/his authority as
determined by law. And there is grave abuse of discretion where the
tribunal, board or officer acts in a capricious, whimsical, arbitrary or
despotic manner in the exercise of his judgment as to be said to be
equivalent to lack of jurisdiction. Certiorari is often resorted to in
order to correct errors of jurisdiction. Where the error is one of law
or of fact, which is a mistake of judgment, appeal is the remedy. 86
It is very conceivable that the DTI Secretary, after deliberate thought and
careful evaluation of the evidence, may either make a negative preliminary
The next issue for resolution is whether the factual determination made by
the Tariff Commission under the SMA is binding on the DTI Secretary.
Otherwise stated, the question is whether the DTI Secretary may impose
general safeguard measures in the absence of a positive final
determination by the Tariff Commission.
The Court of Appeals relied upon Section 13 of the SMA in ruling that the
findings of the Tariff Commission do not necessarily constitute a final
decision. Section 13 details the procedure for the adoption of a safeguard
measure, as well as the steps to be taken in case there is a negative final
determination. The implication of the Court of Appeals' holding is that the
DTI Secretary may adopt a definitive safeguard measure, notwithstanding a
negative determination made by the Tariff Commission.
The SMA was designed not to contradict the GATT, but to complement it.
The two requisites laid down in Section 5 for a positive final determination
are the same conditions provided under the GATT Agreement on
Safeguards for the application of safeguard measures by a member
country. Moreover, the investigatory procedure laid down by the SMA
conforms to the procedure required by the GATT Agreement on
Safeguards. Congress has chosen the Tariff Commission as the competent
authority to conduct such investigation. Southern Cross stresses that
applying the provision of the GATT Agreement on Safeguards, the Tariff
Commission is clearly empowered to arrive at binding conclusions. 132 We
agree: binding on the DTI Secretary is the Tariff Commission's
determinations on whether a product is imported in increased quantities,
absolute or relative to domestic production and whether any such increase
is a substantial cause of serious injury or threat thereof to the domestic
industry.133
Satisfied as we are with the proper statutory paradigm within which the
SMA should be analyzed, the flaws in the reasoning of the Court of Appeals
and in the arguments of the respondents become apparent. To better
understand the dynamics of the procedure set up by the law leading to the
imposition of definitive safeguard measures, a brief step-by-step recount
thereof is in order.
1.
2.
3.
4.
5.
6.
that is not yet final and executory, he or she would have readily been
subjected to sanction by this Court. The DTI Secretary may be beyond the
ambit of administrative review by this Court, but we are capacitated to
allocate the boundaries set by the law of the land and to exact fealty to the
legal order, especially from the instrumentalities and officials of
government.
WHEREFORE, the petition is GRANTED. The assailed Decision of the Court
of Appeals is DECLARED NULL AND VOID and SET ASIDE. The Decision of the
DTI Secretary dated 25 June 2003 is also DECLARED NULL AND VOID and
SET ASIDE. No Costs. SO ORDERED.
G.R. No. 118216
March 9, 2000
DELTAVENTURES RESOURCES, INC., petitioner, vs. HON. FERNANDO P.
CABATO, Presiding Judge Regional Trial Court, La Trinidad, Benguet,
Branch 62; HON. GELACIO L. RIVERA, JR., Executive Labor Arbiter, NLRCCAR, Baguio City, ADAM P. VENTURA, Deputy-Sheriff, NLRC-CAR, Baguio
City; ALEJANDRO BERNARDINO, AUGUSTO GRANADOS, PILANDO
TANGAY, NESTOR RABANG, RAY DAYAP, MYRA BAYAONA, VIOLY LIBAO,
AIDA LIBAO, JESUS GATCHO and GREGORIO DULAY, respondents.
QUISUMBING, J.:
This special civil action for certiorari seeks to annual the Order dated
November 7, 1994,1 of respondent Judge Fernando P. Cabato of the
Regional Trial Court of La Trinidad, Benguet, Branch 62, in Civil Case No. 94CV-0948, dismissing petitioner's amended third-party complaint, as well as
the Order dated December 14, 1994,2 denying motion for reconsideration.
On July 15, 1992, a Decision3 was rendered by Executive Labor Arbiter
Norma Olegario, National Labor Relations Commission Regional
Arbitration Board, Cordillera Autonomous Region (Commission), in NLRC
Case No. 01-08-0165-89 entitled "Alejandro Bernardino, et al, vs. Green
Mountain Farm, Roberto Ongpin and Almus Alabe", the dispositive portion
of which reads as follows:
WHEREFORE, judgment is hereby rendered declaring the
respondents guilty of Illegal Dismissal and Unfair Labor Practice and
ordering them to pay the complainants, in solidum, in the amount
herein below listed:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
xxx
xxx
within 30 days from their receipt of the lists, which remedial measures
included the infusion of additional capital. Though the banks claimed that
they made the additional capital infusions, petitioner Chuchi Fonacier,
officer-in-charge of the SED, sent separate letters to the Board of Directors
of each bank, informing them that the SED found that the banks failed to
carry out the required remedial measures. In response, the banks
requested that they be given time to obtain BSP approval to amend their
Articles of Incorporation, that they have an opportunity to seek investors.
They requested as well that the basis for the capital infusion figures be
disclosed, and noted that none of them had received the Report of
Examination (ROE) which finalizes the audit findings. They also requested
meetings with the BSP audit teams to reconcile audit figures. In response,
Fonacier reiterated the banks failure to comply with the directive for
additional capital infusions.
On May 12, 2008, the RBPI filed a complaint for nullification of the BSP ROE
with application for a TRO and writ of preliminary injunction before the
RTC docketed as Civil Case No. 08-119243 against Fonacier, the BSP,
Amado M. Tetangco, Jr., Romulo L. Neri, Vicente B. Valdepenas, Jr., Raul A.
Boncan, Juanita D. Amatong, Alfredo C. Antonio, and Nelly F. Villafuerte.
RBPI prayed that Fonacier, her subordinates, agents, or any other person
acting in her behalf be enjoined from submitting the ROE or any similar
report to the Monetary Board (MB), or if the ROE had already been
submitted, the MB be enjoined from acting on the basis of said ROE, on the
allegation that the failure to furnish the bank with a copy of the ROE
violated its right to due process.
The Rural Bank of San Jose (Batangas), Inc., Rural Bank of Carmen (Cebu),
Inc., Pilipino Rural Bank, Inc., Philippine Countryside Rural Bank, Inc., Rural
Bank of Calatagan (Batangas), Inc., Rural Bank of Darbci, Inc., Rural Bank of
Kananga (Leyte), Inc., and Rural Bank de Bisayas Minglanilla followed suit,
filing complaints with the RTC substantially similar to that of RBPI, including
the reliefs prayed for, which were raffled to different branches and
docketed as Civil Cases Nos. 08-119244, 08-119245, 08-119246, 08-119247,
08-119248, 08-119249, 08-119250, and 08-119251, respectively.
On May 13, 2008, the RTC denied the prayer for a TRO of Pilipino Rural
Bank, Inc. The bank filed a motion for reconsideration the next day.
On May 14, 2008, Fonacier and the BSP filed their opposition to the
application for a TRO and writ of preliminary injunction in Civil Case No. 08119243 with the RTC. Respondent Judge Nina Antonio-Valenzuela of
Branch 28 granted RBPIs prayer for the issuance of a TRO.
The other banks separately filed motions for consolidation of their cases in
Branch 28, which motions were granted. Judge Valenzuela set the
complaint of Rural Bank of San Jose (Batangas), Inc. for hearing on May 15,
2008. Petitioners assailed the validity of the consolidation of the nine cases
before the RTC, alleging that the court had already prejudged the case by
the earlier issuance of a TRO in Civil Case No. 08-119243, and moved for
the inhibition of respondent judge. Petitioners filed a motion for
reconsideration regarding the consolidation of the subject cases.
On May 16, 2008, San Pablo City Development Bank, Inc. filed a similar
complaint against the same defendants with the RTC, and this was
docketed as Civil Case No. 08-119273 that was later on consolidated with
Civil Case No. 08-119243. Petitioners filed an Urgent Motion to
Lift/Dissolve the TRO and an Opposition to the earlier motion for
reconsideration of Pilipino Rural Bank, Inc.
On May 19, 2008, Judge Valenzuela issued an Order granting the prayer for
the issuance of TROs for the other seven cases consolidated with Civil Case
No. 08-119243. On May 21, 2008, Judge Valenzuela issued an Order
denying petitioners motion for reconsideration regarding the
consolidation of cases in Branch 28. On May 22, 2008, Judge Valenzuela
granted the urgent motion for reconsideration of Pilipino Rural Bank, Inc.
and issued a TRO similar to the ones earlier issued.
On May 26, 2008, petitioners filed a Motion to Dismiss against all the
complaints (except that of the San Pablo City Development Bank, Inc.), on
the grounds that the complaints stated no cause of action and that a
condition precedent for filing the cases had not been complied with. On
May 29, 2008, a hearing was conducted on the application for a TRO and
for a writ of preliminary injunction of San Pablo City Development Bank,
Inc.
The Ruling of the RTC
After the parties filed their respective memoranda, the RTC, on June 4,
2008, ruled that the banks were entitled to the writs of preliminary
injunction prayed for. It held that it had been the practice of the SED to
provide the ROEs to the banks before submission to the MB. It further held
that as the banks are the subjects of examinations, they are entitled to
copies of the ROEs. The denial by petitioners of the banks requests for
copies of the ROEs was held to be a denial of the banks right to due
process.
The dispositive portion of the RTCs order reads:
WHEREFORE, the Court rules as follows:
1) Re: Civil Case No. 08-119243. Pursuant to Rule 58, Section 4(b) of
the Revised Rules of Court, plaintiff Rural Bank of Paranaque Inc. is
directed to post a bond executed to the defendants, in the amount of
P500,000.00 to the effect that the plaintiff will pay to the defendants
all damages which they may sustain by reason of the injunction if the
Court should finally decide that the plaintiff was not entitled thereto.
After posting of the bond and approval thereof, let a writ of
preliminary injunction be issued to enjoin and restrain the
defendants from submitting the Report of Examination or any other
similar report prepared in connection with the examination
conducted on the plaintiff, to the Monetary Board. In case such a
Report on Examination [sic] or any other similar report prepared in
connection with the examination conducted on the plaintiff has been
submitted to the Monetary Board, the latter and its members (i.e.
defendants Tetangco, Neri, Valdepenas, Boncan, Amatong, Antonio,
and Villafuerte) are enjoined and restrained from acting on the basis
of said report.
2) Re: Civil Case No. 08-119244. Pursuant to Rule 58, Section 4(b) of
the Revised Rules of Court, plaintiff Rural Bank of San Jose
(Batangas), Inc. is directed to post a bond executed to the
defendants, in the amount of P500,000.00 to the effect that the
plaintiff will pay to the defendants all damages which they may
sustain by reason of the injunction if the Court should finally decide
that the plaintiff was not entitled thereto. After posting of the bond
and approval thereof, let a writ of preliminary injunction be issued to
enjoin and restrain the defendants from submitting the Report of
Examination or any other similar report prepared in connection with
the examination conducted on the plaintiff, to the Monetary Board.
and Villafuerte) are enjoined and restrained from acting on the basis
of said report.
6) Re: Civil Case No. 08-119248. Pursuant to Rule 58, Section 4(b) of
the Revised Rules of Court, plaintiff Dynamic Bank Inc. (Rural Bank of
Calatagan) is directed to post a bond executed to the defendants, in
the amount of P500,000.00 to the effect that the plaintiff will pay to
the defendants all damages which they may sustain by reason of the
injunction if the Court should finally decide that the plaintiff was not
entitled thereto. After posting of the bond and approval thereof, let a
writ of preliminary injunction be issued to enjoin and restrain the
defendants from submitting the Report of Examination or any other
similar report prepared in connection with the examination
conducted on the plaintiff, to the Monetary Board. In case such a
Report on Examination [sic] or any other similar report prepared in
connection with the examination conducted on the plaintiff has been
submitted to the Monetary Board, the latter and its members (i.e.
defendants Tetangco, Neri, Valdepenas, Boncan, Amatong, Antonio,
and Villafuerte) are enjoined and restrained from acting on the basis
of said report.
7) Re: Civil Case No. 08-119249. Pursuant to Rule 58, Section 4(b) of
the Revised Rules of Court, plaintiff Rural Bank of DARBCI, Inc. is
directed to post a bond executed to the defendants, in the amount of
P500,000.00 to the effect that the plaintiff will pay to the defendants
all damages which they may sustain by reason of the injunction if the
Court should finally decide that the plaintiff was not entitled thereto.
After posting of the bond and approval thereof, let a writ of
preliminary injunction be issued to enjoin and restrain the
defendants from submitting the Report of Examination or any other
similar report prepared in connection with the examination
conducted on the plaintiff, to the Monetary Board. In case such a
Report on Examination [sic] or any other similar report prepared in
connection with the examination conducted on the plaintiff has been
submitted to the Monetary Board, the latter and its members (i.e.
defendants Tetangco, Neri, Valdepenas, Boncan, Amatong, Antonio,
and Villafuerte) are enjoined and restrained from acting on the basis
of said report.
8) Re: Civil Case No. 08-119250. Pursuant to Rule 58, Section 4(b) of
the Revised Rules of Court, plaintiff Rural Bank of Kananga Inc. (First
Intestate Bank), is directed to post a bond executed to the
defendants, in the amount of P500,000.00 to the effect that the
plaintiff will pay to the defendants all damages which they may
sustain by reason of the injunction if the Court should finally decide
that the plaintiff was not entitled thereto. After posting of the bond
and approval thereof, let a writ of preliminary injunction be issued to
enjoin and restrain the defendants from submitting the Report of
Examination or any other similar report prepared in connection with
the examination conducted on the plaintiff, to the Monetary Board.
In case such a Report on Examination [sic] or any other similar report
prepared in connection with the examination conducted on the
plaintiff has been submitted to the Monetary Board, the latter and its
members (i.e. defendants Tetangco, Neri, Valdepenas, Boncan,
Amatong, Antonio, and Villafuerte) are enjoined and restrained from
acting on the basis of said report.
9) Re: Civil Case No. 08-119251. Pursuant to Rule 58, Section 4(b) of
the Revised Rules of Court, plaintiff Banco Rural De Bisayas
found that the joint trial of these cases would prejudice any substantial
right of petitioners.
Finding that no grave abuse of discretion attended the issuance of the
orders by the RTC, the CA denied the petition.
On November 24, 2008, a TRO was issued by this Court, restraining the CA,
RTC, and respondents from implementing and enforcing the CA Decision
dated September 30, 2008 in CA-G.R. SP No. 103935.4
By reason of the TRO issued by this Court, the SED was able to submit their
ROEs to the MB. The MB then prohibited the respondent banks from
transacting business and placed them under receivership under Section 53
of Republic Act No. (RA) 87915 and Sec. 30 of RA
76536 through MB Resolution No. 1616 dated December 9, 2008;
Resolution Nos. 1637 and 1638 dated December 11, 2008; Resolution Nos.
1647, 1648, and 1649 dated December 12, 2008; Resolution Nos. 1652 and
1653 dated December 16, 2008; and Resolution Nos. 1692 and 1695 dated
December 19, 2008, with the Philippine Deposit Insurance Corporation as
the appointed receiver.
Now we resolve the main petition.
Grounds in Support of Petition
I.
II.
III.
made after the petitioner bank was ordered closed, and it was allowed to
be supplied with annexes of the reports in order to better prepare its
defense. In this instance, at the time the respondent banks requested
copies of the ROEs, no action had yet been taken by the MB with regard to
imposing sanctions upon said banks.
The issuance by the RTC of writs of preliminary injunction is an
unwarranted interference with the powers of the MB. Secs. 29 and 30 of
RA 765310 refer to the appointment of a conservator or a receiver for a
bank, which is a power of the MB for which they need the ROEs done by
the supervising or examining department. The writs of preliminary
injunction issued by the trial court hinder the MB from fulfilling its function
under the law. The actions of the MB under Secs. 29 and 30 of RA 7653
"may not be restrained or set aside by the court except on petition for
certiorari on the ground that the action taken was in excess of jurisdiction
or with such grave abuse of discretion as to amount to lack or excess of
jurisdiction." The writs of preliminary injunction order are precisely what
cannot be done under the law by preventing the MB from taking action
under either Sec. 29 or Sec. 30 of RA 7653.
As to the third requirement, the respondent banks have shown no
necessity for the writ of preliminary injunction to prevent serious damage.
The serious damage contemplated by the trial court was the possibility of
the imposition of sanctions upon respondent banks, even the sanction of
closure. Under the law, the sanction of closure could be imposed upon a
bank by the BSP even without notice and hearing. The apparent lack of
procedural due process would not result in the invalidity of action by the
MB. This was the ruling in Central Bank of the Philippines v. Court of
Appeals.11 This "close now, hear later" scheme is grounded on practical and
legal considerations to prevent unwarranted dissipation of the banks
assets and as a valid exercise of police power to protect the depositors,
creditors, stockholders, and the general public. The writ of preliminary
injunction cannot, thus, prevent the MB from taking action, by preventing
the submission of the ROEs and worse, by preventing the MB from acting
on such ROEs.
The trial court required the MB to respect the respondent banks right to
due process by allowing the respondent banks to view the ROEs and act
upon them to forestall any sanctions the MB might impose. Such
procedure has no basis in law and does in fact violate the "close now, hear
later" doctrine. We held in Rural Bank of San Miguel, Inc. v. Monetary
Board, Bangko Sentral ng Pilipinas:
It is well-settled that the closure of a bank may be considered as an
exercise of police power. The action of the MB on this matter is final and
executory. Such exercise may nonetheless be subject to judicial inquiry and
can be set aside if found to be in excess of jurisdiction or with such grave
abuse of discretion as to amount to lack or excess of jurisdiction. 12
The respondent banks cannotthrough seeking a writ of preliminary
injunction by appealing to lack of due process, in a roundabout manner
prevent their closure by the MB. Their remedy, as stated, is a subsequent
one, which will determine whether the closure of the bank was attended
by grave abuse of discretion. Judicial review enters the picture only after
the MB has taken action; it cannot prevent such action by the MB. The
threat of the imposition of sanctions, even that of closure, does not violate
their right to due process, and cannot be the basis for a writ of preliminary
injunction.
The "close now, hear later" doctrine has already been justified as a
measure for the protection of the public interest. Swift action is called for
on the part of the BSP when it finds that a bank is in dire straits. Unless
adequate and determined efforts are taken by the government against
distressed and mismanaged banks, public faith in the banking system is
certain to deteriorate to the prejudice of the national economy itself, not
to mention the losses suffered by the bank depositors, creditors, and
stockholders, who all deserve the protection of the government.13
The respondent banks have failed to show their entitlement to the writ of
preliminary injunction. It must be emphasized that an application for
injunctive relief is construed strictly against the pleader.14 The respondent
banks cannot rely on a simple appeal to procedural due process to prove
entitlement. The requirements for the issuance of the writ have not been
proved. No invasion of the rights of respondent banks has been shown, nor
is their right to copies of the ROEs clear and unmistakable. There is also no
necessity for the writ to prevent serious damage. Indeed the issuance of
the writ of preliminary injunction tramples upon the powers of the MB and
prevents it from fulfilling its functions. There is no right that the writ of
preliminary injunction would protect in this particular case. In the absence
of a clear legal right, the issuance of the injunctive writ constitutes grave
abuse of discretion.15 In the absence of proof of a legal right and the injury
sustained by the plaintiff, an order for the issuance of a writ of preliminary
injunction will be nullified.16
Courts are hereby reminded to take greater care in issuing injunctive relief
to litigants, that it would not violate any law. The grant of a preliminary
injunction in a case rests on the sound discretion of the court with the
caveat that it should be made with great caution.17 Thus, the issuance of
the writ of preliminary injunction must have basis in and be in accordance
with law. All told, while the grant or denial of an injunction generally rests
on the sound discretion of the lower court, this Court may and should
intervene in a clear case of abuse.18
It has been seen that a separate action by the third party who claims
to be the owner of the property attached is appropriate. If this is so,
it must be admitted that the judge trying such action may render
judgment ordering the sheriff of whoever has in possession the
attached property to deliver it to the plaintiff-claimant or desist from
seizing it. It follows further that the court may make an interlocutory
order, upon the filing of such bond as may be necessary, to release
the property pending final adjudication of the title. Jurisdiction over
an action includes jurisdiction over an interlocutory matter incidental
to the cause and deemed necessary to preserve the subject matter of
the suit or protect the parties' interests. This is self-evident.
xxx xxx xxx
It is true of course that property in custody of the law can not be
interfered without the permission of the proper court, and property
legally attached is property in custodia legis. But for the reason just
stated, this rule is confined to cases where the property belongs to
the defendant or one in which the defendant has proprietary
interest. When the sheriff acting beyond the bounds of his office
seizes a stranger's property, the rule does not apply and interference
with his custody is not interference with another court's order of
attachment.
It may be argued that the third-party claim may be unfounded; but so
may it be meritorious, for that matter. Speculations are however
beside the point. The title is the very issue in the case for the
recovery of property or the dissolution of the attachment, and
pending final decision, the court may enter any interlocutory order
calculated to preserve the property in litigation and protect the
parties' rights and interests.
Generally, the rule that no court has the power to interfere by injunction
with the judgments or decrees of a concurrent or coordinate jurisdiction
having equal power to grant the injunctive relief sought by injunction, is
applied in cases where no third-party claimant is involved, in order to
prevent one court from nullifying the judgment or process of another court
of the same rank or category, a power which devolves upon the proper
appellate court . 2 The purpose of the rule is to avoid conflict of power
between different courts of coordinate jurisdiction and to bring about a
harmonious and smooth functioning of their proceedings.
It is further argued that since private respondent La Tondea, Inc., had
voluntarily submitted itself to the jurisdiction of the Pasay Court by filing a
motion to intervene in Civil Case No. 9894-P, the denial or dismissal thereof
constitutes a bar to the present action filed before the Bulacan Court.
We cannot sustain the petitioner's view. Suffice it to state that intervention
as a means of protecting the third-party claimant's right in an attachment
proceeding is not exclusive but cumulative and suppletory to the right to
bring an independent suit. 3 The denial or dismissal of a third-party claim to
property levied upon cannot operate to bar a subsequent independent
action by the claimant to establish his right to the property even if he failed
to appeal from the order denying his original third-party claim. 4
WHEREFORE, the instant petition is hereby dismissed and the decision of
the Intermediate Appellate Court in AC-G.R. No. SP-01860 is affirmed, with
costs against petitioner Traders Royal Bank. SO ORDERED.
rejected" from carrying out the Project.4 The term of the TRO was for a
period of twenty (20) days.
Upon learning of the TRO, the DPWH and the BAC, through the Office of
the Solicitor General (OSG), filed a Motion to Dismiss Petition with Motion
for Dissolution of Temporary Restraining Order Dated March 4, 2002. 5
While noting the impropriety of a twenty (20)-day TRO without prior notice
or hearing, they pointed out that Republic Act No. 8975 precisely
prohibited the issuance by any court, save the Supreme Court, of a TRO or
preliminary injunction which restrains or prohibits the bidding for or
awarding of a contract/project of the national government. Accordingly,
they prayed that the petition be dismissed and the TRO dissolved.
This new motion was set for hearing on 21 March 2002, and thereupon the
parties were afforded the opportunity to argue their case. Then, on 27
March 2002, the RTC issued an order dismissing Nolascos petition. The
dismissal of the petition was warranted, according to the RTC, as it was a
suit against the State, which had been sued without its consent. 6 The RTC
also noted that Nolasco had not established that he would sustain a direct
injury should the contract be awarded to Daewoo, and that the general
interest which may have been possessed by Nolasco along with all
members of the public would not suffice.7
Interestingly, on 2 April 2002, the OSG claims to have received a copy of an
alleged order dated 22 March 2002 purportedly signed by Judge Nabong
which denied the motion to dismiss, gave the petition due course, and
granted the preliminary injunction subject to the posting of an injunction
bond in the amount of Five Hundred Thousand Pesos (P500,000.00).8
However, in a Certification signed by Loida P. Moralejo, Officer-in-Charge of
RTC Branch 32, it was attested that the signature in this order was
spurious, and affirmed instead the Order dated 22 March 2002 dismissing
the petition.
In the meantime, the BAC issued Resolution No. MFCDP-RA-02 dated 1
April 2002. The BAC noted therein that among the three lowest bidders
were Daewoo and China International, and that based on the bid amounts
"as corrected," the bid of Daewoo was the lowest of the three, followed by
China Internationals.10 As a result, the BAC resolved to recommend the
award of the contract for the Project to Daewoo. Then DPWH Secretary
Simeon Datumanong approved the recommendation by affixing his
signature on the Resolution on the same day.11 A copy of the Resolution
and the Bid Evaluation Report was furnished to JBIC for "review and
concurrence."12
For his part, Nolasco filed a motion for reconsideration dated 3 April 2002,
seeking the reversal of the Order dated 27 March 2002 dismissing his
petition. Nolasco set this motion for reconsideration for hearing on 18 April
2002, but none apparently ensued.13 The OSG filed its Opposition/
Comment/Manifestation dated 24 April 2002 wherein it prayed that it be
allowed to adopt its earlier motion to dismiss as its opposition to the
motion for reconsideration. The RTC granted OSGs prayer in an Order
dated 13 May 2002.14 In the same Order, the RTC likewise stated that "in
the spirit of comprehensive fairness, this Court must, and hereby, [set] the
hearing on the reception of petitioners evidence on this Motion [for
Reconsideration]" on 17 May 2002.15
During the hearing of 17 May 2002, the OSG asked Judge Nabong to clarify
his directive that a hearing be had for the reception of Nolascos evidence.
Judge Nabong clarified that his bent was for petitioner to present his
evidence but no longer on the question of whether a TRO or injunction
should be issued. The RTC granted the OSGs prayer to submit a motion for
reconsideration of this order, which the OSG did on 31 May 2002. 16 In the
motion for reconsideration, the OSG argued that it was unnecessary to
receive Nolascos evidence, considering that the dismissal of the petition
was grounded on pure questions of law. It also sought clarification of Judge
Nabongs remarks during the 17 May 2002 hearing, which seemed to imply
that this new hearing would actually be on the merits of the petition.
This new OSG motion was submitted to the RTC during the hearing of 28
June 2002, wherein Petitioner announced that the motion was to be
resolved in due time. At the same time, the RTC allowed Nolasco to adduce
his evidence over the objections of the OSG. Nolasco presented a witness,
Engineer Shohei Ezaki, a DPWH consultant hired by JBIC who testified
pursuant to a subpoena earlier issued by the court. Ezaki testified as to the
Evaluation Report and Result prepared by his consultant firm and which
had been earlier attached to Nolascos petition. Nolasco also intimated its
intention to present DPWH Director Philip F. Meez as a witness on his
behalf. In the hearing of 2 August 2002, the OSG manifested that it would
file motions opposing the presentation of witnesses by Nolasco and the
issuance of subpoenas requiring their testimony. In its order issued in open
court on 2 August 2002, the RTC deferred the further presentation of
Nolascos witnesses pending the filing of OSGs motions.
At that point, the proceedings thus far undertaken had been unorthodox.
Then the course veered sharply to the bizarre. Nolasco filed a motion dated
12 August 2002, seeking the rendition of a partial judgment and dismissal
of his own petition, based on the proceedings that had transpired during
the hearings held on 28 June and 2 August 2002.17 In the motion, Nolasco
reiterated his submission that based on the evidence presented thus far,
Daewoo should have been disqualified from bidding on the project. While
the prayer for the dismissal of the motion for reconsideration was
anchored on the need "to abbreviate the proceedings" so as to implement
the projects, the motion nonetheless urged the court, to issue a partial
judgment and award the bid for the Project to China International. Nolasco
likewise filed a Formal Offer of Evidence dated 29 August 2002. The offered
evidence included various documents and the testimony of Nolasco and his
witnesses previously heard by the court. Both submissions of Nolasco were
vigorously objected to by the OSG in pleadings filed to that effect. 18
Then, on 6 September 2002, the RTC issued the Order now assailed before
this Court. It included a brief discussion of the factual antecedents, as well
as the 27 March 2002 Order dismissing the petition and the various
pleadings filed by the parties prior and subsequent to the dismissal of the
petition. The last two pages of the four (4)-page Order proceeded to dissect
the testimonies and ultimate dispositions therein. The last three
paragraphs of the Order and its fallo are replicated below in full:
In the hearing, however, on August 21, 2002, Atty. Abelardo M. Santos for
petitioner in open court, formally offered the testimony of Mr. Ezaki,
although, before the start of his testimony Atty. Santos Manifested: "Your
Honor, the purpose of the testimony of this witness is to show that they had
made a technical study of all the pre-qualified bidders referring to the Agno
River Flood Control Project, Phase II."
Engr Shohel Ezaki, hired by the Japan Bank for International Cooperation
(JBIC) through which the funding, granted by the Overseas Development
Assistance (ODA), is covered and flows through, and the DPWH and
President, Philippines Office, Nippon Koie Company, Ltd., (testifying under
an issued subpoena duces tecum ad testificandum) testified that the
Evaluation Report and Result of their consultant firm in association with
the PKII and the Basic Team Inc., (doing evaluation works for the DPWH)
disqualified DAEWOO and ITALIAN THAI on Packages 1 and 2, Phase II.
Insofar, moreover, as regards Package 1, Phase II, the bids submitted by
TOA Corporation is the lowest evaluated responsive bid. The second lowest
evaluated responsive bid is that of China State Construction Engineering. In
open court, on August 2, 2002, Director Engr. Philip F. Menez, Major Floor
Control & Drainage Project-Project Management Office, Cluster II, DPWH,
confirmed the award to TOA Corporation, the evaluated responsive bid,
Package 1.
All told, and presently, and urgently, there is the need to implement the
PROJECTS in this petition so as not to affect the ODA funding, harnessed
through JBIC. More so, in addition, and a thoughtful consideration of
pleadings and argument, from the Formal Offer of Evidence ADMITTED,
facts, hearing, respondent BAC has strayed from fairly applying the Bidding
Laws, Guidelines, Rules, and Regulations, and Bid Tender Documents and,
as a matter of fairness, and in the interest of justice, considering other
bidders whose bids have been evaluated by the Technical Working Group
including the consultant, Nippon Koie Company, Ltd., in association with
the PKII and the Basic Team, Inc., to be substantially responsive, the
Honorable Simeon P. Datumanong must now seriously consider and
effect the award of Package 2, PHASE II, of the Agno River Floor Control
Project, as duly recommended by the Consultants and the Technical
Working Group, DPWH, to China International Water & Electric
Corporation being the lowest evaluated responsive bid.
WHEREFORE, in view of all the foregoing, the Motion for Reconsideration
of the Petition is hereby DISMISSED.
SO ORDERED. (Emphasis supplied)19
The OSG received a copy of the Order dated 6 September 2002 on 17
September 2002. It opted to file a Petition for Review on Certiorari under
Rule 45 with this Court, instead of resorting to a motion for
reconsideration, to avert unnecessary delay of the implementation of the
Project which would result in millions of pesos in damages. The OSG thus
alleges that the petition raises pure questions of law, thereby dispensing
with recourse to the Court of Appeals.20
The OSG also notes that in a letter to the DPWH dated 21 June 2002, JBIC,
through Chief Representative Mitsuru Taruki, let it be known that it had
decided to hold in abeyance its concurrence to the project, as "the issue
[was] now under the jurisdiction of the appropriate Philippine courts and
other relevant organizations of the Philippine government," and that it
would be prudent to wait "for the decisions of the proper authorities
before taking any action on the matter."21 It is likewise worth noting at this
juncture that Nolasco had also filed a verified complaint against the
Chairman and members of the BAC with the Presidential Anti-Graft
Commission, as well as another complaint with the National Economic
Development Authority and a complaint-letter with JBIC itself requesting
that the bank reject the award to Daewoo.22
Since the filing of the present petition, both Daewoo and China
International have since participated in the case. Daewoo filed a Commentin-Intervention dated 10 January 2003, which this Court treated as a
petition-In-intervention.23 Upon order of this Court, China International
filed a Comment-in-Intervention dated 5 February 2003.
Petitioner imputes error to the RTC in taking notice of and resolving
Nolascos Motion to Issue Partial Judgment and Motion to Dismiss Petition,
pleading which give meaning to the pleading and on the basis of which
such pleading may be legally characterized.26 An examination of the
"petition" reveals that it should be considered as a complaint for
injunction, with a prayer for the provisional relief of temporary restraining
order/preliminary injunction. After all, the Petition prayed that
respondents therein (Petitioner herein) be restrained from awarding the
contracts to Daewoo, citing as basis thereof its "unacceptability," as
purportedly established by the evaluation report.
Nonetheless, the prayer for the issuance of a temporary restraining order
or preliminary injunction affecting the bidding or awarding of a national
government contract or project, would have called for the application of
Republic Act No. 8975 and the corresponding denial of the prayer for
provisional relief. Still, the RTC instead issued a TRO in its Order dated 4
March 2002.
Republic Act No. 8975 definitively enjoins all courts, except the Supreme
Court, from issuing any temporary restraining order, preliminary injunction,
or preliminary mandatory injunction against the government, or any of its
subdivisions, officials or any person or entity to restrain, prohibit or compel
the bidding or awarding of a contract or project of the national
government,27 precisely the situation that obtains in this case with respect
to the Agno River Project. The only exception would be if the matter is of
extreme urgency involving a constitutional issue, such that unless the
temporary restraining order is issued, grave injustice and irreparable injury
will arise.28 The TRO issued by the RTC failed to take into consideration said
law. Neither did it advert to any extreme urgency involving a constitutional
issue, as required by the statute. The law ordains that such TRO is void,29
and the judge who issues such order should suffer the penalty of
suspension of at least sixty (60) days without pay.30
Nevertheless, there is no need to belabor this point since the TRO no
longer subsists. It appears that the RTC subsequently realized the import of
Republic Act No. 8975 as it cited the same in its 27 March 2002 Order
dismissing the Petition:
Applying Republic Act No. 8975, most particularly Section 3 thereof, and
Administrative Circular No. 11-2000 issued on November 13, 2000 by the
Honorable Hilario G. Davide, Jr., Chief Justice, Supreme Court, all parties
having copies, the Petition at bench ought to be dismissed outrightly (sic).31
However, it must be clarified that Republic Act No. 8975 does not ordinarily
warrant the outright dismissal of any complaint or petition before the
lower courts seeking permanent injunctive relief from the implementation
of national government infrastructure projects. What is expressly
prohibited by the statute is the issuance of the provisional reliefs of
temporary restraining orders, preliminary injunctions, and preliminary
mandatory injunctions. It does not preclude the lower courts from
assuming jurisdiction over complaints or petitions that seek as ultimate
relief the nullification or implementation of a national government
infrastructure project. A statute such as Republic Act No. 8975 cannot
diminish the constitutionally mandated judicial power to determine
whether or not there has been a grave abuse of discretion amounting to
lack or excess of jurisdiction on the part of any branch or instrumentality of
government.32 Section 3 of the law in fact mandates, thus:
If after due hearing the court finds that the award of the contract is null
and void, the court may, if appropriate under the circumstances, award the
contract to the qualified and winning bidder or order a rebidding of the
same, without prejudice to any liability that the guilty party may incur
under existing laws.
Thus, when a court is called upon to rule on an initiatory pleading assailing
any material aspect pertinent to a national government infrastructure
project, the court ordinarily may not dismiss the action based solely on
Republic Act No. 8975 but is merely enjoined from granting provisional
reliefs. If no other ground obtains to dismiss the action, the court should
decide the case on the merits. As we recently held in Opia v. NHA:33
Unquestionably, the power to issue injunctive writs against the
implementation of any government infrastructure project is exclusively
lodged with this Court, pursuant to Section 3 of Rep. Act No. 8975. But
while lower courts are proscribed thereunder from issuing restraining
orders and/or writs of preliminary injunction to stop such projects, the
proscription does not mean that such courts are likewise bereft of authority
to take cognizance of the issue/issues raised in the principal action, as long
as such action and the relief sought are within their jurisdiction.
Accordingly, it was not proper for the RTC to cite Republic Act No. 8975 as
basis for the dismissal of Nolascos petition since the statute does not bar
the institution of an action that seeks to enjoin the implementation of a
national government project, but merely the issuance of provisional orders
enjoining the same. However, the RTC cited two other grounds for the
dismissal of the casethat Nolascos general interest as a taxpayer was not
sufficient to establish any direct injury to him should the Project be
awarded to Daewoo; and that the petition was a suit against the State,
which may not be sued without its consent.
We shall defer for now a review of these two grounds cited by the RTC for
the dismissal of Nolascos petition, and instead focus on the proper steps
that should have been undertaken owing to the dismissal of the case.
Nolasco filed a motion for reconsideration or the dismissal of the case, a
remedy available to him since the 27 March 2002 Order is a final order that
disposed of the case.34 Petitioner responded with an all-encompassing
Opposition/Comment/Mani-festation (Re: Petitioners Motion for
Reconsideration). Both of these submissions were set for hearing before
the RTC. The RTC could have very well resolved the motion for
reconsideration based on the pleadings submitted. Yet, in its Order dated
13 May 2002, it declared:
However, be that as it may, in the spirit of comprehensive fairness, this
Court must, and hereby, sets the hearing on the Reception of Petitioners
evidence on this Motion on May 17, 2002 at 9:00 A.M. 35
As far as determinable, there is no legal or jurisprudential standard of
"comprehensive fairness," a phrase that reeks of pomposity without
admitting to any concrete meaning. Neither is there any mandatory rule
directing a court to conduct a hearing to receive evidence on a motion for
reconsideration. Nonetheless, a motion for reconsideration, as with all
other motions which may not be acted upon without prejudicing the rights
of the adverse party, is required to be set for hearing by the applicant,36
and to be heard with due notice to all parties concerned. 37
It is certainly within acceptable bounds of discretion for the trial judge to
require or allow the movant for reconsideration to present evidence in
support of the arguments in the motion, and in fact desirable if such
evidence should be necessarily appreciated for a fair and correct
disposition of the motion for reconsideration. Yet caution should be had. At
this stage, the issues and evidence submitted for appreciation and
Now, the Motion for Partial Judgment and to Dismiss Petition seeks reliefs
A and B that China International be awarded the project; and that the
motion for reconsideration be dismissed. There is no doubt that relief B
was unequivocally granted by the trial court, with the following disposal:
Instead, the RTC, upon Nolascos insistence, proceeded instead to hear the
case on the merits. The RTC allowed Nolascos witness, Engineer Ezaki to
testify as to the authenticity and veracity of the bid evaluation report
attached to Nolascos petition, and to affirm the conclusion that Daewoo
was not a qualified bidder.38 This unusual turn of events arouses suspicion.
The RTC had earlier dismissed the petition on legal grounds, yet it was now
considering factual matters as basis for review on reconsideration. The
petitioner, through counsel, appears to have strenuously objected to this
furtive and dubious recourse by Nolasco, but to no avail.
SO ORDERED.
Then, despite the fact that other witnesses of Nolasco were still scheduled
to be heard, Nolasco filed the Motion to Issue Partial Judgment and to
Dismiss Petition. He expressly prayed that his very own motion for
reconsideration of the petition be dismissed. From this motion, it is difficult
to ascertain why exactly Nolasco wanted the RTC to deny his own motion
for reconsideration and to affirm the dismissal of his own petition, though
there is the expressed concern "in order to abbreviate the proceedings in
view of the need to implement the subject projects of this petition the
soonest possible time."39 At the same time, and in the same pleading,
Nolasco still asserted that Daewoo was not qualified to be awarded the
project, and emphasizes that such contention was borne out by the
evidence he had presented thus far. Accordingly, he likewise prayed that
partial judgment be rendered on the petition, calling on the RTC to
conclude that China International won the Project, it being the lowest
evaluated responsive bid.40
It bears noting that at this stage, there were two pending motions before
the RTC, both filed by Nolasco, which had at issue whether or not his
petition should be dismissed. The first was Nolascos motion for
reconsideration praying for the reinstatement of his petition. The second
was Nolascos Motion for Partial Judgment and to Dismiss Petition, praying
for the dismissal of his petition. Palpably, Nolasco had opted to hedge his
chips on both red and black, which is not normally done for obvious
reasons. Neither did Nolasco, in his latter pleading, expressly withdraw his
earlier motion for reconsideration, although his subsequent prayer for the
dismissal of his own earlier motion sufficiently evinced such intent.
This Motion for Partial Judgment and to Dismiss Petition is truly an odd
duckling of a pleading, which unfortunately did not blossom into a swan
but from it instead emerged an even uglier duckthe 6 September 2002
Order, which dismissed the petition yet intoned that DPWH Secretary
Datumanong "must now seriously consider and effect the award" of the
project to China International.
There is no doubt that the assailed Order dated 6 September 2002 sought
to resolve the Motion for Partial Judgment and to Dismiss Petition. This is
evident from the first sentence of the Order, which states: "Before the
Court is petitioners Motion to Issue Partial Judgment and to Dismiss
Petition filed on August 16, 2002." No other pending motion, such as the
motion for reconsideration, was adverted to as being subject for resolution
by the said Order.
But did the trial court grant relief A that China International be awarded
the project?
All told, and presently, and urgently, there is the need to implement the
PROJECTS in this petition so as not to affect the ODA funding, harnessed
through JBIC. More so, in addition, and a thoughtful consideration of
pleadings and argument, from the Formal Offer of Evidence ADMITTED,
facts, hearing, respondent BAC has strayed from fairly applying the Bidding
Laws, Guidelines, Rules, and Regulations, and Bid Tender Documents and,
as a matter of fairness, and in the interest of justice, considering other
bidders whose bids have been evaluated by the Technical Working Group
including the consultant, Nippon Koie Company, Ltd., In association with
the PKII and the Basic Team, Inc., to be substantially responsive, the
Honorable Simeon P. Datumanong must now seriously consider and
effect the award of Package 2, PHASE II, of the Agno River Floor Control
Project, as duly recommended by the Consultants and the Technical
Working Group, DPWH, to China International Water & Electric
Corporation being the lowest evaluated responsive bid.42 (emphasis
supplied)
Contrast this with Nolascos prayer on the same relief in his Motion for
Partial Judgment and to Dismiss Petition, thus:
WHEREFORE, in view of the foregoing premises, and in consideration of
equity and petitioners moral obligation and in order to abbreviate the
proceedings in view of the need to implement the subject projects of this
petition the soonest possible time so an not to jeopardize the funding
granted by the Overseas Development Assistance (ODA) fund through the
Japan Bank For International Cooperation (JBIC), it is respectfully prayed
unto this Honorable Court to issue its partial judgment on the petition. An
[sic] in view of the foregoing findings that clear violation of bidding laws,
rules and regulations, the respondents Bid Tender Documents, has been
committed by the respondents members of the BAC, and in fairness to the
other bidder whose bids have been evaluated by the Technical Working
Group including the consultant, Nippon Koie Company, Ltd., in association
with the PKIII and the Basic Team, Inc. to be substantially responsive, the
Bid of China International Water & Electric Corporation being the lowest
evaluated responsive bid must be awarded the project, package 2, Phase
II, of the Agno River Flood Control Projects as recommended by the
Consultants and the Technical Working Group of the respondents. The
respondent, Honorable Secretary Simeon Datumanong is hereby directed
to take steps to attain this end.43 (Emphasis supplied)
Unmistakably though, the controverted portion of the Order, urging the
DPWH Secretary "to consider" awarding the Project to China International
does not form part of the dispositive portion or fallo. What should be
deemed as the dispositive portion in this case is the final paragraph of the
Resolution, which reads: "WHEREFORE, in view of all the foregoing, the
Motion for Reconsideration of the Petition is hereby DISMISSED."
employed in the order, "must now seriously consider and effect the
award," indicates that the judge was hesitant to definitively grant the relief
sought by Nolasco, which was that the trial court award the bid to China
International and direct Sec. Datumanong to take steps towards this end.
Instead, it stated that Sec. Datumanong "must now seriously consider and
effect the award" to China International. Undoubtedly, the word "must" is
mandatory in character, but it is used in conjunction with "consider". In
short, the trial court noted that the DPWH Secretary "must think about"
effecting an award to China International.
Imagine if Nolasco had tried to judicially enforce this portion of the
decision. Agents of the court would be sent over to the DPWH offices to
confront the DPWH Secretary. What else could they say but, "Sir, have you
seriously considered effecting the award to China International?" Of
course, the DPWH Secretary can reply, "Yes, but I decided to award the bid
anyway to Daewoo," and such averment would evince satisfactory
compliance with the assailed Order. After all, the Order did not require that
the DPWH award the bid to China International, only that the DPWH
consider such a measure.
These premises considered, we cannot agree with Petitioner
characterization of this portion of the Order as granting affirmative relief in
favor of China International.51 No such affirmative relief was rendered in
favor of China International, as such was not included as part of the fallo.
Nor was there an evident intent on the part of the judge to grant such
affirmative relief, on account of the language he employed,
recommendatory in character as it ultimately was.
Still, if the Court were to construe this assailed portion of the Order as
belonging to the dispository part, such disposition, effectively concluding
that China International and not DAEWOO should be awarded the bid,
would run contrary to law.
It must be remembered that Nolascos prayer that the trial court award the
bid to China International utilized as legal basis the power of the trial
courts to issue partial or separate judgments. Yet by any objective
standard, there is no merit in allowing for such a relief in this case. Section
5, Rule 36 of the Rules of Civil Procedure, which governs separate
judgments, states:
Sec. 5. Separate judgments. When more than one claim for relief is
presented in an action, the court, at any stage, upon a determination of the
issues material to a particular claim and all counterclaims arising out of the
transaction or occurrence which is the subject matter of the claim, may
render a separate judgment disposing of such claim. The judgment shall
terminate the action with respect to the claim so disposed of and the
action shall proceed as to the remaining claims. . . .
On paper, Nolascos petition prays for two reliefs, that the petitioner be
restrained from awarding the Project to Daewoo, and that Daewoo be
disqualified as a bidder and its bid be rejected. Yet these reliefs are
obviously intertwined for the allowance of one would necessarily lead to
the grant of the other. The multiple reliefs referred to in the provision refer
to those sufficiently segregate from each other that the allowance of one
at a preliminary stage will not preclude litigation on the merits of the
others.
More importantly, the rule is explicit that partial judgment with regards
one of the reliefs is warranted only after "a determination of the issues
material to a particular claim and all counterclaims arising out of the
as a tax payer does not mean that in each and every instance where such a
ground is invoked courts are left with no alternative except to hear the
parties, for the courts are vested with discretion whether or not a
taxpayers suit should be entertained.53 We likewise find no error on the
part of the RTC when it cited as basis for the dismissal of Nolascos petition,
our ruling in Bugnay Construction & Development Corp. v. Laron54 that the
taxpayer-plaintiff must specifically prove that he has sufficient interest in
preventing the illegal expenditure of money raised by taxation, and that he
will sustain a direct injury as a result of the enforcement of the questioned
statute or contract.55
We also find no error on the part of the RTC in regarding Nolascos petition
as a suit against the State without the latters consent. An unincorporated
government agency such as the DPWH is without any separate juridical
personality of its own and hence enjoys immunity from suit.56 Even in the
exercise of proprietary functions incidental to its primarily governmental
functions, an unincorporated agency still cannot be sued without its
consent.57 Moreover, it cannot be said that the DPWH was deemed to have
given its consent to be sued by entering into a contract, for at the time the
petition was filed by Nolasco, the DPWH had not yet entered into a
contract with respect to the Project.
Surprisingly, and with no apparent benefit on its behalf, Petitioner imputes
error on the part of the RTC when the court, in the fallo of the assailed
Order, directed the dismissal of the "Motion for Reconsideration of the
Petition," pointing out that such pleading was never filed by Nolasco,58 and
accordingly prays "that the order dismissing the alleged Motion for
Reconsideration of Petition be declared null and void."59 However, Nolasco
did file a "Motion for Reconsideration" to the order dismissing the petition,
and in his Motion for Partial Judgment and to Dismiss Petition, Nolasco
similarly prays that "the Motion for Reconsideration of the Petition be
dismissed." We have no doubt, infelicitous wording aside, that the "Motion
for Reconsideration of the Petition" adverted to in the fallo refers to
Nolascos own motion for reconsideration, the denial of which Nolasco also
prayed for in the Motion for Partial Judgment and to Dismiss Petition that
was the subject of the assailed Order. And as just discussed, the denial of
the Nolascos motion for reconsideration was in order.
Notably, this Court has not engaged in a review of the award of the Project
to Daewoo. Notwithstanding the fact that the parties have prayed that the
Court either effect the award of the Project to Daewoo or direct the award
to China International, the Court deems it improper to conduct a de novo
factual finding on which entity should be awarded the project. The Court is
not a trier of facts, and it would be offensive to established order and the
hierarchy of courts for this Court to initiate such factual review. Had the
RTC conducted a valid trial on the merits, perhaps this Court could
eventually review the lower courts findings on the matter, but the RTC
properly dismissed the case, and it would be unbecoming on the part of
this Court to suddenly engage in an initial trial on the merits on appellate
review.
This is a stance not borne out of hesitance to tackle the issue, or avoid the
sort of ruling that may satisfy one party or the other as "definitive," but
arrived at out of necessity to preserve the integrity of our civil procedure,
including the hierarchy of our courts and the limits of this Courts power of
judicial review. Precisely, the messy milieu presented before us occurred
because the RTC and Nolasco compromised our court processes to
destructive ends, and it is this Courts function to reassert the rules, to
national government.62 Yet to his credit, Judge Nabong recalled the TRO
upon realizing his error, thus a REPRIMAND should suffice under the
circumstances.
WHEREFORE, premises considered, the Petition is DENIED. The assailed
Order dated 6 September 2004 is AFFIRMED, with the QUALIFICATION that
last paragraph of the body of the Order, which states that the DPWH
Secretary "must now seriously consider and effect the award of Package 2,
Phase II of the Agno River Flood Control Project" is OBITER DICTA and
hence of no binding force.
The National Bureau of Investigation is hereby DIRECTED to investigate the
circumstances surrounding the alleged spurious order dated 22 March
2002 served on the Office of the Solicitor General and determine possible
criminal liabilities for the creation of such forged document.
Judge Juan Nabong is hereby REPRIMANDED for failure to observe Section
6 of Republic Act No. 8975, and WARNED that a subsequent repetition of
the same shall be dealt with more severely.
No costs. SO ORDERED.
G.R. No. 145328 March 23, 2006
EDUARDO F. HERNANDEZ, MA. ENCARBACION R. LEGASPI, JAIME
BLANCO, JR., ENRIQUE BELO, CARLOS VIAPLANA, CARL FURER, VIVENCIO
TINIO, MICHAEL BRIGGS, ROSA CARAM, FAUSTO PREYSLER, ROBERT KUA,
GEORGE LEE, GUILLERMO LUCHANGCO, PETER DEE, LUISA MARQUEZ,
ANGELITA LILLES, JUAN CARLOS, HOMER GO, AMADEO VALENZUELA,
EMILIO CHING, ANTONIO CHAN, MURLI SABNANI, MARCOS ROCES,
RAYMUNDO FELICIANO, NORMA GAFFUD, ALF HOLST, LOURDES P.
ROQUE, MANUEL DY, RAUL FERNANDEZ, VICTORIA TENGCO, CHI MO
CHENG, BARANGAY DASMARIAS, and HON. FRANCISCO B. IBAY,
petitioners vs. NATIONAL POWER CORPORATION, respondent
DECISION
CHICO-NAZARIO, J.:
Although Presidential Decree No. 1818 prohibits any court from issuing
injunctions in cases involving infrastructure projects, the prohibition
extends only to the issuance of injunctions or restraining orders against
administrative acts in controversies involving facts or the exercise of
discretion in technical cases. On issues clearly outside this dimension and
involving questions of law, this Court declared that courts could not be
prevented from exercising their power to restrain or prohibit
administrative acts.1 In such cases, let the hammer fall and let it fall hard.
With health risks linked to exposure to electromagnetic radiation as their
battle cry, petitioners, all residents of Dasmarias Village, are clamoring for
the reversal of the decision2 dated 3 May 2000 of the Court of Appeals in
CA-G.R. SP No. 57849 as well as the resolution dated 27 September 2000,
denying their motion for reconsideration.
The assailed decision3 of the Court of Appeals reversed the order of the
Regional Trial Court of Makati, issuing a writ of preliminary injunction
against respondent National Power Corporation (NAPOCOR) to stay the
latter from energizing and transmitting high voltage electric current
through its cables erected from Sucat, Paraaque to Araneta Ave., Quezon
City.
themselves and their families, petitioners, through the instant case, sought
what they had failed to achieve through amicable means with NAPOCOR
and prayed, inter alia, for damages and the relocation of the transmission
lines to Lawton Avenue, Fort Bonifacio.
8
reason of the injunction if the Court should finally decide that the
petitioners are not entitled thereto.12
In light of the foregoing order of the trial court, the petition which
NAPOCOR filed with the Court of Appeals was later amended to include the
prayer for the nullification and injunction of the Order dated 3 April 2000
of the trial court.
In the challenged decision of 3 May 2000, the Court of Appeals reversed
the trial courts order, with the following fallo:
WHEREFORE, premises considered, the instant petition for certiorari is
hereby GRANTED. The assailed orders of the respondent court, dated
March 13, 2000 and April 3, 2000, are hereby REVERSED and SET ASIDE.13
In the Court of Appeals rationale, the proscription on injunctions against
infrastructure projects of the government is clearly mandated by the
above-quoted Section 1 of Presidential Decree No. 1818, as reiterated by
the Supreme Court in its Circulars No. 2-91 and No. 13-93, dated 15 March
1991 and 5 March 1993, respectively.
As their motion for reconsideration was met with similar lack of success,
petitioners, in a last attempt at vindication, filed the present petition for
review on the following arguments:
I.
Temporary restraining orders and preliminary injunctions were purposely
designed to address matters of extreme urgency where there is probability
of grave injustice and irreparable injury.14
II.
The rule on preliminary injunction merely requires that unless restrained,
the act complained of will probably work injustice to the applicant or
probably violate his rights and tends to render the judgment ineffectual.15
(Emphasis in the original.)
Fundamental to the resolution of the instant petition is the issue of
whether or not the trial court may issue a temporary restraining order and
preliminary injunction to enjoin the construction and operation of the 29
decagon-shaped steel poles or towers by the NAPOCOR, notwithstanding
Presidential Decree No. 1818.
Petitioners clutch on their stand that Presidential Decree No. 1818 could
not be construed to apply to cases of extreme urgency as in the present
case when no less than the rights of the petitioners to health and safety
hangs on the balance.
We find the petition to be imbued with merit.
Presidential Decree No. 1818 was issued on 16 January 1981, prohibiting
judges from issuing restraining orders against government infrastructure
projects. In part, the decree says, "No court in the Philippines shall have
jurisdiction to issue any restraining order, preliminary injunction or
preliminary order, preliminary mandatory injunction in any case, dispute or
controversy involving an infrastructure project." Realizing the importance
of this decree, this Tribunal had issued different circulars to implement this
particular law.
(b)
(c)
Indeed, if there is no cause for concern, NAPOCOR would not have been
stirred to come up with options to address the woes of petitioners, nor
would Congressman Escudero have fired away those strong words of
censure, assailing what to Congressman Escudero smacks of a "cavalier
manner by which the NAPOCOR has responded to earnest pleas for a
review of its practice of installing massive pylons supporting high tension
cables in densely populated areas."19
True, the issue of whether or not the transmission lines are safe is
essentially evidentiary in nature, and pertains to the very merits of the
action below. In fact, petitioners recognize that the conclusiveness of their
life, health and safety concerns still needs to be proved in the main case
below and they are prepared to do so especially in the light of some studies
cited by respondent that yield contrary results in a disputed subject.
Despite the parties conflicting results of studies made on the issue, the
a willful and unlawful invasion of plaintiffs right against his protest and
remonstrance, the injury being a continuing one, and where the effect of
the mandatory injunction is rather to reestablish and maintain a
preexisting continuing relation between the parties, recently and arbitrarily
interrupted by the defendant, than to establish a new relation." (Emphasis
supplied.)
What is more, contrary to respondents assertion, there is not a single
syllable in the circulars issued by this Court enjoining the observance of
Presidential Decree No. 1818, which altogether and absolutely, ties the
hands of the courts from issuing a writ of preliminary injunction. What
Circular 2-9121 dated 15 March 1991 seeks to enjoin is the indiscriminate
issuance of court injunctions. The same holds for Circular 13-9322 dated 5
March 1993 and Circular 68-94.23 And, in Circular No. 7-99, judges are
enjoined to observe utmost caution, prudence and judiciousness in the
issuance of temporary restraining order and in the grant of writs of
preliminary injunction to avoid any suspicion that its issuance or grant was
for consideration other than the strict merits of the case.24
There is not a hint from the foregoing circulars suggesting an unbridled
prohibition against the issuance of temporary restraining orders or
preliminary injunctions.
In sum, what Presidential Decree No. 1818 aims to avert is the untimely
frustration of government infrastructure projects, particularly by
provisional remedies, to the detriment of the greater good by disrupting
the pursuit of essential government projects or frustrate the economic
development effort of the nation. Presidential Decree No. 1818, however,
was not meant to be a blanket prohibition so as to disregard the
fundamental right to health, safety and well-being of a community
guaranteed by the fundamental law of the land. 25
Lest we be misconstrued, this decision does not undermine the purpose of
the NAPOCOR project which is aimed towards the common good of the
people. But, is the promotion of the general welfare at loggerheads with
the preservation of the rule of law? We submit that it is not. 26
In the present case, the far-reaching irreversible effects to human safety
should be the primordial concerns over presumed economic benefits per
se as alleged by the NAPOCOR.
Not too long ago, the Court, in Metropolitan Manila Development
Authority (MMDA) v. Bel-Air Village Association, Inc.,27 upheld the validity
of the writ of preliminary injunction issued by the Court of Appeals
enjoining the implementation of the Metropolitan Manila Development
Authoritys proposed action of opening of the Neptune Street to public
vehicular traffic. We were categorical Not infrequently, the government is tempted to take legal shortcuts to
solve urgent problems of the people. But even when government is armed
with the best of intention, we cannot allow it to run roughshod over the
rule of law. Again, we let the hammer fall and fall hard on the illegal
attempt of the MMDA to open for public use a private road in a private
subdivision. While we hold that the general welfare should be promoted,
we stress that it should not be achieved at the expense of the rule of law.28
In hindsight, if, after trial, it turns out that the health-related fears that
petitioners cleave on to have adequate confirmation in fact and in law, the
questioned project of NAPOCOR then suffers from a paucity of purpose, no
matter how noble the purpose may be. For what use will modernization
II.
III.
Art. 1868 of the Civil Code provides that by the contract of agency, an
agent binds himself to render some service or do something in
representation or on behalf of another, known as the principal, with the
consent or authority of the latter.13
A contract of agency is generally revocable as it is a personal contract of
representation based on trust and confidence reposed by the principal on
his agent. As the power of the agent to act depends on the will and license
of the principal he represents, the power of the agent ceases when the will
or permission is withdrawn by the principal. Thus, generally, the agency
may be revoked by the principal at will.14
However, an exception to the revocability of a contract of agency is when it
is coupled with interest, i.e., if a bilateral contract depends upon the
agency.15 The reason for its irrevocability is because the agency becomes
part of another obligation or agreement. It is not solely the rights of the
principal but also that of the agent and third persons which are affected.
Hence, the law provides that in such cases, the agency cannot be revoked
at the sole will of the principal.
In the case at bar, we agree with the finding of the trial and appellate
courts that the agency granted by Legaspi to Gutierrez is coupled with
interest as a bilateral contract depends on it. It is clear from the records
that Gutierrez was given by Legaspi, inter alia, the power to manage the
treasure hunting activities in the subject land; to file any case against
anyone who enters the land without authority from Legaspi; to engage
the services of lawyers to carry out the agency; and, to dig for any
treasure within the land and enter into agreements relative thereto. It
was likewise agreed upon that Gutierrez shall be entitled to 40% of
whatever treasure may be found in the land. Pursuant to this authority
and to protect Legaspis land from the alleged illegal entry of petitioners,
agent Gutierrez hired the services of Atty. Adaza to prosecute the case for
damages and injunction against petitioners. As payment for legal services,
Gutierrez agreed to assign to Atty. Adaza 30% of Legaspis share in
whatever treasure may be recovered in the subject land. It is clear that
the treasure that may be found in the land is the subject matter of the
agency; that under the SPA, Gutierrez can enter into contract for the legal
services of Atty. Adaza; and, thus Gutierrez and Atty. Adaza have an
interest in the subject matter of the agency, i.e., in the treasures that may
be found in the land. This bilateral contract depends on the agency and
thus renders it as one coupled with interest, irrevocable at the sole will of
the principal Legaspi.16 When an agency is constituted as a clause in a
bilateral contract, that is, when the agency is inserted in another
agreement, the agency ceases to be revocable at the pleasure of the
principal as the agency shall now follow the condition of the bilateral
agreement.17 Consequently, the Deed of Revocation executed by Legaspi
has no effect. The authority of Gutierrez to file and continue with the
prosecution of the case at bar is unaffected.
On the second issue, we hold that the issuance of the writ of preliminary
injunction is justified. A writ of preliminary injunction is an ancilliary or
preventive remedy that is resorted to by a litigant to protect or preserve
his rights or interests and for no other purpose during the pendency of the
principal action.18 It is issued by the court to prevent threatened or
continuous irremediable injury to the applicant before his claim can be
thoroughly studied and adjudicated.19 Its aim is to preserve the status quo
ante until the merits of the case can be heard fully, upon the applicants
showing of two important conditions, viz.: (1) the right to be protected
prima facie exists; and, (2) the acts sought to be enjoined are violative of
that right.20
Section 3, Rule 58 of the 1997 Rules of Civil Procedure provides that a writ
of preliminary injunction may be issued when it is established:
(a)
(b)
(c)
It is crystal clear that at the hearing for the issuance of a writ of preliminary
injunction, mere prima facie evidence is needed to establish the applicants
rights or interests in the subject matter of the main action. 21 It is not
required that the applicant should conclusively show that there was a
violation of his rights as this issue will still be fully litigated in the main
case.22 Thus, an applicant for a writ is required only to show that he has
an ostensible right to the final relief prayed for in his complaint. 23
In the case at bar, we find that respondent judge had sufficient basis to
issue the writ of preliminary injunction. It was established, prima facie,
that Legaspi has a right to peaceful possession of his land, pendente lite.
Legaspi had title to the subject land. It was likewise established that the
diggings were conducted by petitioners in the enclosed area of Legaspis
land. Whether the land fenced by Gutierrez and claimed to be included in
the land of Legaspi covered an area beyond that which is included in the
title of Legaspi is a factual issue still subject to litigation and proof by the
parties in the main case for damages. It was necessary for the trial court to
issue the writ of preliminary injunction during the pendency of the main
case in order to preserve the rights and interests of private respondents
Legaspi and Gutierrez.
On the third issue, petitioners charge that the respondent judge lacked the
neutrality of an impartial judge. They fault the respondent judge for not
giving credence to the testimony of their surveyor that the diggings were
conducted outside the land of Legaspi. They also claim that respondent
judges rulings on objections raised by the parties were biased against
them.
We have carefully examined the records and we find no sufficient basis to
hold that respondent judge should have recused himself from hearing the
case. There is no discernible pattern of bias on the rulings of the
respondent judge. Bias and partiality can never be presumed. Bare
allegations of partiality will not suffice in an absence of a clear showing
that will overcome the presumption that the judge dispensed justice
without fear or favor.24 It bears to stress again that a judges appreciation
or misappreciation of the sufficiency of evidence adduced by the parties, or
the correctness of a judges orders or rulings on the objections of counsels
during the hearing, without proof of malice on the part of respondent
judge, is not sufficient to show bias or partiality. As we held in the case of
Webb vs. People,25 the adverse and erroneous rulings of a judge on the
On July 31, 1999, the Court of Appeals issued its assailed Decision
dismissing the petition, thus:
"WHEREFORE, premises considered, the petition is hereby denied due
course and the same DISMISSED. Let the original record of the case be
remanded to the court a quo immediately upon the finality hereof.
"SO ORDERED."8
The Court of Appeals ratiocinated as follows:
"After a fine filtration of the record ('expediente') and a close look at the
two assailed orders, We agree with the private respondent that the
respondent court did not commit any grave abuse of discretion in issuing
them. At this juncture, it is well to state that the special civil action for
certiorari is a remedy designed for the correction of errors of jurisdiction
and not errors of judgment (Ramnani vs. Court of Appeals, 221 SCRA 582).
It will not even issue for simple abuse of discretion (University of the
Philippines vs. Civil Service Commission, 228 SCRA 207). Parenthetically,
grave abuse of discretion implies such capricious and whimsical exercise of
judgment as is equivalent to lack of jurisdiction (Planters Products, Inc. vs.
Court of Appeals, 193 SCRA 563), or in other words, where the power is
exercised in an arbitrary or despotic manner by reason of passion or
personal hostilityand it must be so patent and gross as to amount to an
evasion of positive duty or to a virtual refusal to perform the duty enjoined
or to act at all in contemplation of law (Bustamante vs. Commission on
Audit, 216 SCRA 134; Philippine Airlines, Inc. vs. Confesor, 231 SCRA 41). In
the case at bench, the record does not show such kind of actuation on the
part of the respondent judge. As long as a court or quasi-judicial body acts
within its jurisdiction, any alleged errors committed in the exercise of its
jurisdiction will amount to nothing more than errors of judgment which are
reviewable by timely appeal and not by a special civil action of certiorari
(New York Marine Managers, Inc. vs. Court of Appeal, 249 SCRA 416;
Commissioner on Internal Revenue vs. Court of Appeals, 257 SCRA 200).
"Furthermore, this being a petition for certiorari, factual matters are not
proper for consideration (Insular Bank of Asia and America vs. Court of
Appeals, 228 SCRA 420; Navarro vs. Commission on Elections, 228 SCRA
596), for this Court has to confine itself to the issue of whether of not the
respondent court lacked or exceeded its jurisdiction or committed grave
abuse of discretion (San Pedro vs. Court of Appeals, 253 SCRA 145)it
cannot review conclusion of fact (Holy Cross of Davao College, Inc. vs.
Joaquin, 263 SCRA 358). Anyway, it should be stated that the grant or
denial of an injunction rests on the sound discretion of the trial court
(Technology Developers, Inc. vs. Court of Appeals, 193 SCRA 147; Avila vs.
Tapucar, 201 SCRA 148)and the same will not be interfered with by
appellate courts except on a clear abuse of discretion (S & A Gaisano
Incorporated vs. Hidalgo, 19 SCRA 224), which situation appeared wanting
in the case at bench. We took note that the respondent court conducted
hearings before issuing a writ of preliminary injunction. More. The private
respondent was even required to put a bond to answer for possible
damages which may arise from the issuance of said writ of preliminary
injunction. On this score, We wish to advert to Supreme Court rulings that
erroneous conclusions or errors of judgment or of procedure, not relating
to the court's jurisdiction or involving grave abuse of discretion, are not
reviewable by certiorari under Rule 65 of the Rules of Court (Rodriguez vs.
Court of Appeals, 245 SCRA 150; Commissioner on Internal Revenue vs.
Court of Appeals, supra; Santiago Land Development Company vs. Court of
Appeals, 258 SCRA 535). For, as already stated, such errors are reviewable
by timely appeal.
respondent, the trial court found that all the requisites for the issuance of
an injunctive writ were present.13 Although petitioner presented evidence
to rebut private respondent's assertions, those will be better assessed and
considered in the trial proper. The assailed injunctive writ is not a judgment
on the merits of the case, contrary to the submission of petitioner, for a
writ of preliminary injunction is generally based solely on initial and
incomplete evidence. The evidence submitted during the hearing of the
incident is not conclusive or complete for only a "sampling" is needed to
give the trial court an idea of the justification for the preliminary injunction
pending the decision of the case on the merits.14 As such, the findings of
fact and opinion of a court when issuing the writ of preliminary injunction
are interlocutory in nature and made before the trial on the merits is
commenced or terminated. Furthermore, it does not necessarily proceed
that when a writ of preliminary injunction is issued, a final injunction will
follow, as erroneously argued by petitioner. There are vital facts that have
yet to be presented during the trial which may not be obtained or
presented during the hearing on the application for the injunctive writ. 15
Clearly, petitioner's contention that the trial court and the Court of Appeals
had already disposed of the main case lacks merit.
Also, the sole object of a preliminary injunction is to preserve the status
quo until the merits of the case can be heard. 16 Here, after evaluating the
evidence presented by both contending parties, the trial court held that
justice would be better served if the status quo is preserved until the final
determination of the merits of the case. We find nothing whimsical,
arbitrary, or capricious in such ruling.
Significantly, the rule is well-entrenched that the issuance of the writ of
preliminary injunction rests upon the sound discretion of the trial court. It
bears reiterating that Section 4 of Rule 58 gives generous latitude to the
trial courts in this regard for the reason that conflicting claims in an
application for a provisional writ more often than not involve a factual
determination which is not the function of the appellate courts. Hence, the
exercise of sound judicial discretion by the trial court in injunctive matters
must not be interfered with except when there is manifest abuse,17 which
is wanting in the present case.
In sum, we find the petition bereft of merit. It is not the proper remedy and
even if it is, no grave abuse of discretion was committed by respondent
Court of Appeals.
WHEREFORE, the petition is DISMISSED. SO ORDERED.
G.R. No. 175145
March 28, 2008
SPOUSES ALFREDO and SHIRLEY YAP, Petitioners, vs. INTERNATIONAL
1
EXCHANGE BANK, SHERIFF RENATO C. FLORA and/or OFFICE OF THE
CLERK OF COURT, REGIONAL TRIAL COURT, MAKATI CITY, Respondents.
DECISION
CHICO-NAZARIO, J.:
Before Us is a Petition for Review on Certiorari under Rule 45 of the 1997
Rules of Civil Procedure which seeks to set aside the Resolution2 of the
Court of Appeals in CA-G.R. SP No. 95074 dated 11 July 2006 which
dismissed petitioner-spouses Alfredo and Shirley Yaps petition for
certiorari which questioned the Order3 of Branch 264 of the Regional Trial
Court (RTC) of Pasig City in Civil Case No. 68088 recalling and dissolving the
Writ of Preliminary Injunction dated 13 August 2001, and its Resolution4
dated 9 October 2006 denying petitioners Motion for Reconsideration.
prayer preliminary injunction in the Order dated July 18, 2001 and the
corresponding writ issued on August 13, 2001.
I.
Defendants in this case, however, are not without remedy to pray for
dissolution of preliminary injunction already granted because it is only
interlocutory and not permanent in nature.
The provisions of Section 6, Rule 58 of the Revised Rules of Court allow
dissolution of the injunction granted provided there is affidavit of party or
persons enjoined; an opportunity to oppose by the other party; hearing on
the issue, and filing of a bond to be fixed by the court sufficient to
compensate damages applicant may suffer by dissolution thereby.
A preliminary injunction is merely a provisional remedy, an adjunct to the
main case subject to the latters outcome. Its sole objective is to preserve
the status quo until the trial court hears fully the merits of the case. The
status quo is the last actual, peaceable and uncontested situation which
precedes a controversy. The status quo should be that existing at the time
of the filing of the case. A preliminary injunction should not establish new
relations between the parties, but merely maintain or re-establish the preexisting relationship between them. x x x.
When the complainants right or title is doubtful or disputed, he does not
have a clear legal right and, therefore, the issuance of injunctive relief is
not proper and constitutes grave abuse of discretion. x x x. In the case at
bar, plaintiffs deed of sale was purported to be not duly notarized. As
such, the legal right of what the plaintiffs claim is still doubtful and such
legal right can only be threshed out in a full blown trial where they can
clearly establish the right over the disputed properties.
Moreover, defendants are willing to post a counter bond which could cover
up to the damages in favor of plaintiffs in case the judgment turns out to
be adverse to them. Under the Rules of Civil Procedure, this is perfectly
allowed and the dissolution of the writ of injunction can accordingly be
issued. In the case of Lasala vs. Fernandez, the highest court has
enunciated that "a court has the power to recall or modify a writ of
preliminary injunction previously issued by it. The issuance or recall of a
preliminary writ of injunction is an interlocutory matter that remains at all
times within the control of the court." (G.R. No. L-16628, May 23, 1962).
The defendants had shown that dissolution of the writ of injunction is just
and proper. It was duly shown that great and irreparable injury would
severely cause the defendants if the writ of injunction shall continue to
exist.31
On 5 May 2006, petitioners filed a Petition for Certiorari before the Court
of Appeals asking that the trial courts Order dated 29 April 2006 be set
aside.32
During the pendency of the Petition for Certiorari, petitioners filed before
the trial court a Very Urgent Motion to Suspend Proceedings 33 to which
respondents filed a Comment.34
On 11 July 2006, the Court of Appeals resolved to dismiss outright the
Petition for Certiorari for failure of petitioners to file a motion for
reconsideration of the Order dated 29 April 2006.35 The Motion for
Reconsideration36 filed by petitioners was denied.37
After being granted an extension of thirty days within which to file a
petition for certiorari, petitioners filed the instant Petition on 14 December
2006. They made the following assignment of errors:
II.
III.
IV.
At the outset, it must be said that the Writ of Preliminary Injunction dated
13 August 2001 issued by the trial court has not yet been actually dissolved
because respondents have not posted the required counter-bond in the
amount of P10,000,000.00. The dissolution thereof is primed on the filing
of the counter-bond.
Petitioners argue that the trial court abused its discretion when it ordered
the dissolution of the Writ of Preliminary Injunction, the propriety of its
issuance having been affirmed by both the Court of Appeals and the
Supreme Court. There being an Order by this Court that the injunction
issued by the trial court was not tainted with grave abuse of discretion, the
dissolution of said writ is a clear defiance of this Courts directive.
Respondents, on the other hand, contend that the trial court has the
authority and prerogative to set aside the Writ of Preliminary Injunction.
They add that since petitioners Deed of Sale was not duly notarized, the
latters application for preliminary injunction is devoid of factual and legal
bases. They assert that, not being public documents, the subject deeds of
sale are nothing but spurious, if not falsified, documents. They add that the
continuance of the Writ of Preliminary Injunction would cause them
irreparable damage because it continues to incur damage not only for the
nonpayment of the judgment award (in Civil Case No. 98-791 before the
RTC of Makati City, Br. 150), but also for opportunity losses resulting from
the continued denial of its right to consolidate title over the levied
properties.
There is no dispute that both the Court of Appeals and this Court have
ruled that the issuance of the Writ of Preliminary Injunction by the trial
court was not tainted with grave abuse of discretion. Respondents tried to
undo the issuance of said writ but to no avail. The Resolution on the matter
attained finality on 30 July 2005 and an entry of judgment was made.
This, notwithstanding, respondents filed with the RTC of Pasig City, Branch
264, an Omnibus Motion (To Resolve Motion to Dismiss Complaint and/or
Dissolve Injunction) dated 31 January 2006 praying that their Motion for
Reconsideration dated 26 February 2001 of the trial courts denial of their
Motion to Dismiss which the trial court failed to resolve, be resolved
and/or the Writ of Preliminary Injunction previously issued be dissolved.
With this Omnibus Motion, the trial court issued the Order dated 13
August 2001 recalling and dissolving the Writ of Preliminary Injunction
conditioned on the filing of a P10,000,000.00 counter-bond.
The question is: Under the circumstances obtaining in this case, may the
trial court recall and dissolve the preliminary injunction it issued despite
the rulings of the Court of Appeals and by this Court that its issuance was
not tainted with grave abuse of discretion?
We hold that the trial court may still order the dissolution of the
preliminary injunction it previously issued.1avvphi1 We do not agree with
petitioners argument that the trial court may no longer dissolve the
preliminary injunction because this Court previously ruled that its issuance
was not tainted with grave abuse of discretion.
The issuance of a preliminary injunction is different from its dissolution. Its
issuance is governed by Section 3,38 Rule 58 of the 1997 Rules of Civil
Procedure while the grounds for its dissolution are contained in Section 6,
Rule 58 of the 1997 Rules of Civil Procedure. As long as the party seeking
the dissolution of the preliminary injunction can prove the presence of any
of the grounds for its dissolution, same may be dissolved notwithstanding
that this Court previously ruled that its issuance was not tainted with grave
abuse of discretion.
Section 6 of Rule 58 reads:
Section 6. Grounds for objection to, or for motion of dissolution of,
injunction or restraining order. The application for injunction or
restraining order may be denied, upon a showing of its insufficiency. The
injunction or restraining order may also be denied, or, if granted, may be
dissolved, on other grounds upon affidavits of the party or person
enjoined, which may be opposed by the applicant also by affidavits. It may
further be denied, or, if granted, may be dissolved, if it appears after
hearing that although the applicant is entitled to the injunction or
restraining order, the issuance or continuance thereof, as the case may be,
would cause irreparable damage to the party or person enjoined while the
applicant can be fully compensated for such damages as he may suffer, and
the former files a bond in an amount fixed by the court conditioned that he
will pay all damages which the applicant may suffer by the denial or the
dissolution of the injunction or restraining order. If it appears that the
extent of the preliminary injunction or restraining order granted is too
great, it may be modified.
appeal, or any plain, speedy and adequate remedy in the course of law
except via a petition for certiorari. When same was dismissed by the Court
of Appeals for failure to file a motion for reconsideration of the trial courts
Order, they argue that while the filing of a motion for reconsideration is a
sine qua non before a petition for certiorari is instituted, the same is not
entirely without exception like where the controverted act is patently
illegal or was performed without jurisdiction or in excess of jurisdiction. It
was only when the Court of Appeals dismissed their Petition did they argue
that exceptions to the general rule should apply. Their invocation of the
application of the exceptions was belatedly made. The application of the
exceptions should be raised in their Petition for Certiorari and not when
their Petition has already been dismissed. They must give their reasons and
explain fully why their case falls under any of the exceptions. This,
petitioners failed to do.
Petitioners argument that they filed the Petition for Certiorari without
filing a motion for reconsideration because there is no appeal, or any plain,
speedy and adequate remedy in the course of law except via a Petition for
Certiorari does not convince. We have held that the "plain" and "adequate
remedy" referred to in Section 1, Rule 65 of the Rules of Court is a motion
for reconsideration of the assailed Order or Resolution. 43 The mere
allegation that there is "no appeal, or any plain, speedy and adequate
remedy" is not one of the exceptions to the rule that a motion for
reconsideration is a sine qua non before a petition for certiorari may be
filed.
All told, we hold that the act of the trial court of issuing the Order dated 29
April 2006 was not patently illegal or performed without or in excess of
jurisdiction. The Court of Appeals was correct in dismissing outright
petitioners Petition for Certiorari for failing to file a motion for
reconsideration of the trial courts Order.
Petitioners contend that the Court of Appeals erred and gravely abused its
discretion when it dismissed outright their Petition for Certiorari by failing
to apply existing jurisprudence that a motion for reconsideration may be
dispensed with where the controverted act is patently illegal or was
performed without jurisdiction or in excess of jurisdiction. On the other
hand, respondents urge the Court to deny the Petition for Review, arguing
that the Court of Appeals properly applied the general rule that the filing of
a motion for reconsideration is a condition sine qua non in order that
certiorari will lie.
Our pronouncements in this case are confined only to the issue of the
dissolution of the preliminary injunction and will not apply to the merits of
the case.
SO ORDERED.