Republic of the
Supreme Court
THIRD DIVISION
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DAVID LU, Petitioner, - versus - PATERNO
LU YM, SR., PA Respondents. x - - - - - - - - - - - - - - - - - -
- - - - - x PATERNO LU YM, SR., PATERNO LU YM,
JR., VICTOR LU YM, JOHN LU YM, KELLY LU YM, and LUDO & LUYM DEVELOPMENT
CORP., Petitioners, -versus- DAVID LU, Respondent. x - - - - - - - - - - - - - - - - - -
- - - - - x JOHN LU YM and LUDO & LUYM
DEVELOPMENT CORPORATION,
Petitioners, -versus- THE HON. COURT OF APPEALS OF CEBU CITY
(former Twentieth Division), DAVID LU, ROSA GO, SILVANO LUDO & CL
CORPORATION,
Respondents. |
|
G.R. No. 153690 G.R. No. 157381 G.R. No. 170889 Present: YNARES-SANTIAGO, J., Chairperson, CARPIO-MORALES,* CHICO-NAZARIO, NACHURA, and REYES,
JJ. Promulgated: August 26, 2008 |
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* Additional member replacing
Associate Justice Alicia Austria-Martinez per raffle dated
NACHURA, J.:
Before
us are three consolidated petitions assailing the decisions
rendered and the resolutions issued by the Court of Appeals (CA) in CA-G.R. SP
No. 64523, CA-G.R. SP No. 73383 and CA-G.R. CV No. 81163.
In G.R. No. 153690, David Lu (David) prays that this Court annul and
set aside the Decision[1]
dated
In G.R. No. 157381, Paterno Lu Ym, Sr. (Paterno Sr.), Paterno Lu Ym, Jr.
(Paterno Jr.), John Lu Ym (John), Kelly Lu Ym (Kelly) (collectively referred to
as the Lu Ym father and sons), and Ludo and Luym Development Corp. (LLDC) assail
the CA Decision[5] dated
February 27, 2003 ordering the RTC to desist from conducting any proceeding
relating to the receivership over LLDC.
In
G.R. No. 170889, John and LLDC
question the CA Resolutions dated
Factual and Procedural Antecedents
LLDC
is a family corporation founded by Paterno Sr. and his brothers (the fathers of
Rosa, Silvano and David), primarily to hold real estate for the family.[8] In 1997, LLDC’s Board of Directors authorized
the issuance of its 600,000 unsubscribed and unissued shares at par value of P100.00
per share. The Lu Ym father and sons
subscribed to and paid most of such shares. David, et al., however, claimed
that the 600,000 LLDC stocks were issued in favor of the Lu Ym father and sons
for less than their real values. Hence, the complaint[9]
filed on August 14, 2000, by David, Rosa Go (Rosa), Silvano Ludo (Silvano) and
CL Corporation (CL Corp.) against the Lu Ym father and sons, namely: Paterno
Sr., Paterno Jr., Victor Lu Ym (Victor), John, Kelly, and LLDC, for Declaration of Nullity of Share Issue, Receivership
and Dissolution, before the RTC of Cebu City. The case was raffled to Branch 5 and was
docketed as Civil Case No. CEB-25502. In said complaint, David, et al. asked that
the issuance of said shares be nullified.[10] They further asserted that the Lu Ym father
and sons gravely abused their powers as members of LLDC’s Board of Directors by
issuing such shares, to the prejudice of David, et al. They, therefore, asked
for the dissolution of the corporation as their ultimate remedy to obtain
redress for their grievances.[11] To protect the interest of the corporation
during the pendency of the case, David et al. asked that a receiver for the
corporation be appointed.[12]
On
August 25, 2000, the Lu Ym father and sons moved to dismiss[13]
the complaint for non-compliance with the Rules of Court on the required certificate of non-forum shopping, since only
one of the four plaintiffs signed the same, without any showing that he was
authorized to sign on behalf of the other parties. They, likewise, contended that the case was
dismissible because they did not exert earnest efforts toward a compromise.
In
a Resolution[14] dated
On
Aggrieved,
the Lu Ym father and sons elevated the matter to the Court of Appeals assailing
the court’s resolutions denying their motion to dismiss and their motion for
reconsideration; and placing the corporation under receivership and appointing
two persons as receivers. The case was
docketed as CA-G.R. SP No. 64154, but the same was dismissed on the ground that
the verification and certification against forum shopping were signed by only
two petitioners.[18] They later refiled the case. This time, it was docketed as CA-G.R. SP No. 64523.
The
appellate court initially dismissed[19]
the petition, finding no grave abuse of discretion on the part of the RTC when
it denied the Lu Ym father and sons’ motion to dismiss and because of the
prematurity of the petition on the issue of receivership (since there was still
a motion for reconsideration pending before the RTC).[20] However, on motion of the Lu Ym father and
sons, the court reconsidered its earlier ruling and, consequently, reinstated
the earlier petition.[21] The Lu Yms then filed a Supplement to their
petition.
On December 20, 2001, the CA granted[22]
the Lu Ym father and sons’ petition and, thus, dismissed the complaint filed by
David Lu, et al. for the parties’ (except David Lu) failure to sign the
certificate of non-forum shopping. In ruling
for the dismissal of the initiatory pleading, the court applied Loquias v. Ombudsman.[23] As a consequence of the dismissal of the
complaint, the appellate court likewise annulled the resolutions placing the
corporation under receivership and appointing the receivers.[24]
On
Meanwhile, the Lu Ym father and sons
filed a Motion for Inhibition against the then RTC Judge Ireneo Gako, Jr.,
which was granted on
On October 8, 2002, the Lu Ym father
and sons filed in SRC Case No. 021-CEB a Manifestation and Motion praying for
the immediate lifting of the receivership order over LLDC which was immediately
set for hearing.[27] However, the hearing did not proceed as
scheduled due to the repeated motions of David to stop it. It turned out later that David instituted a
special civil action for Certiorari
and Prohibition with the CA, with Urgent Application for Temporary Restraining
Order (TRO) and Writ of Preliminary Injunction, on the sole issue of whether or
not the RTC should proceed to hear the Lu Ym father and sons’ motion to lift
the receivership. The case was docketed
as CA-G.R. SP No. 73383.[28]
On
Aggrieved, the Lu Ym father and sons
instituted the instant petition in G.R.
No. 157381.
Meanwhile, Judge Dicdican inhibited
himself, and the case was thus transferred from Branch 11 to Branch 12.
On
On
On
In view of the court’s declaration of
the executory nature of the assailed decision, the Lu Ym father and sons
applied for a Writ of Preliminary Injunction and/or Temporary Restraining Order
(TRO),[35]
which was opposed[36]
by David.
On
In their motion for reconsideration,[39]
the Lu Ym father and sons assailed the denial of their application for
preliminary injunction and, in addition thereto, they questioned the
sufficiency of the docket fees paid by David, et al. in the RTC where the
original complaint was filed.
On
The Issues
G.R. No. 153690
David Lu raises the following issues
for resolution.
[a] WHETHER OR NOT
THE COURT OF APPEALS GRAVELY ERRED IN DISREGARDING THE NUMEROUS FATAL DEFECTS
AND RULES OF COURT AND IRCA VIOLATIONS OF RESPONDENTS’
[b] WHETHER OR NOT THE COURT OF APPEALS GRAVELY
ERRED IN DISMISSING THE RTC CASE IN ITS ENTIRETY AND IN REFUSING TO PERMIT IT
TO PROCEED AS TO PETITIONER DESPITE [I] PETITIONER’S EXECUTION OF A
CERTIFICATION AGAINST FORUM SHOPPING FOR THE COMPLAINT AND [II] THE FACT [THAT]
THE RTC CASE INVOLVES ONLY A PERMISSIVE JOINDER OF PARTIES.[41]
On
G.R. No. 157381
The Lu Ym father and sons base their
petition on the following alleged errors:
I.
THE JUDGMENT OF THE
COURT OF APPEALS IS NULL AND VOID ON ITS FACE FOR LACK OF JURISDICTION IN
ENJOINING THE TRIAL COURT BECAUSE THE DISMISSAL OF THE CASE BELOW IS ALREADY
PENDING APPEAL WITH THIS HONORABLE COURT AND IT IS, THEREFORE, THIS HONORABLE
COURT THAT HAS EXCLUSIVE JURISDICTION OVER THE REMEDIES OF CERTIORARI,
PROHIBITION AND INJUNCTION GRANTED BY THE COURT OF APPEALS.
II.
THE PETITION FOR
CERTIORARI AND PROHIBITION WAS WRONGFULLY GRANTED BY THE COURT OF APPEALS
BECAUSE ITS DECISION DID NOT CONTAIN THE BASIC FINDING THAT THE TRIAL COURT
COMMITTED A GRAVE ABUSE OF DISCRETION TANTAMOUNT TO LACK OR EXCESS OF
JURISDICTION, NOR DID IT EVEN DEFINE IT AS AN ISSUE IN THE CASE, NOR WAS THERE
ANY GRAVE ABUSE OF DISCRETION.
III.
EVEN ASSUMING IN GRATIA ARGUMENTI THAT THE COURT OF APPEALS HAD JURISDICTION OVER THE CASE, IT HAD ABSOLUTELY NO LEGAL BASIS IN ENJOINING THE TRIAL COURT FROM ACTING ON THE URGENT MOTION OF THE PETITIONERS TO LIFT THE HIGHLY OPPRESSIVE ORDER OF RECEIVERSHIP.[43]
On
G.R. No. 170889
In coming before this Court in this
special civil action for certiorari
and prohibition, John Lu Ym and LLDC raise the following issues:
I.
WHETHER OR NOT THE RESPONDENT COURT
OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION IN DENYING PETITIONERS’ MOTION
FOR RECONSIDERATION DESPITE THE FACT THAT THE TRIAL COURT DID NOT ACQUIRE
JURISDICTION OVER THE SUBJECT MATTER OF THE CASE FOR FAILURE OF THE RESPONDENTS
TO PAY THE CORRECT DOCKET FEES WHEN THE ORIGINAL COMPLAINT WAS FILED.
II.
WHETHER OR NOT THE RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION IN NOT DISMISSING SRC CASE NO. 021-CEB DESPITE CLEAR SHOWING THAT RESPONDENTS WERE GUILTY OF BAD FAITH IN AVOIDING PAYMENT OF THE CORRECT DOCKET FEES.[47]
On
Stripped of the non-essentials and
combining all the arguments set forth in the consolidated petitions, the issues
for our resolution are as follows:
I.
Whether the original complaint filed
before the RTC should have been dismissed for:
A.
non-compliance with the rules on certificate
of non-forum shopping; and
B. non-payment of the correct docket fees
II.
Whether the receivership proceedings were
validly suspended pending the amendment of the initial complaint in compliance
with the Interim Rules of Procedure for Intra-Corporate Controversies
III.
Whether a writ of preliminary injunction
should have been issued pending the resolution of the appeal on the merits
filed before the Court of Appeals.
The Ruling of This Court
In G.R. No. 153690, David claims that the Lu
Ym father and sons’ petition (in CA-G.R. SP No. 64523) before the CA should not
have been entertained because of the following fatal defects: 1) the petition questioning
the approval of the receivership was prematurely filed because of the pendency of
their motion for reconsideration before the RTC; 2) their motion and supplement
were filed without asking leave of court to do so; 3) considering that the
motion and supplement contained new allegations, there was a failure to attach
a new certificate of non-forum shopping; and 4) the motion and supplement were
filed out of time.[49]
At the outset, we find the procedural
issues raised by David to be of no moment.
Basic is the rule that a motion for the reconsideration of an assailed
order may be filed by an aggrieved party within the reglementary period. No motion for leave to file such motion is
required under the Rules or in any other circular of the Supreme Court. As long as the same is filed within fifteen
(15) days from receipt of the assailed order, there is no reason for the courts
not to entertain it. In fact, in some
exceptional cases as when substantial justice so requires, a motion belatedly
filed may still be taken cognizance of.
As to the supplemental petition filed without leave of court, suffice it
to state that the CA entertained the same, required David to comment thereon,
and decided the case on the basis thereof. Such
actions of the appellate court adequately show that the supplemental petition
was admitted. Lastly, as to the lack of
certificate of non-forum shopping in the motion for reconsideration and
supplement to the petition, we need only reiterate that the certificate is
required only in cases of initiatory pleadings.[50]
Now on the substantial issues.
In G.R. No. 153690, the assailed CA
decision dismissed David et al.’s original complaint for their failure to sign
the verification and certification of non-forum shopping. Subsequent to the aforesaid decision, however,
the RTC ordered David et al. to amend the complaint to conform to the interim
rules of procedure for intra-corporate controversy. In compliance with the order, David, et al.
amended the complaint and filed the same with leave of court. The RTC, thereafter, admitted the amended
complaint, proceeded to hear the case, and decided the same on the merits.
While it is true that the Lu Ym father
and sons questioned the admission of the aforesaid amended complaint before
this Court, the same was done only through an Urgent Motion.[51] Under the Rules of Court, the proper mode to
challenge such an order, which undoubtedly is interlocutory, is through a
special civil action for certiorari under
Rule 65. This procedural defect, therefore,
bars the Court from ruling on the propriety of such admission. We cannot take cognizance of proceedings
before the RTC unless they are brought before us through the proper mode of
review. To be sure, the Urgent Motion cannot be a
substitute for the remedy of a special civil action for certiorari.[52] Consequently, the amended complaint admitted
by the RTC stands.
With the issue of admission of the amended
complaint resolved, the question of whether or not the original complaint
should have been dismissed was mooted.
Section 8, Rule 10 of the Rules of Court specifically provides that an
amended pleading supersedes the pleading that it amends.
In this case, the original complaint was deemed withdrawn from the
records upon the admission of the amended complaint.[53] This
conclusion becomes even more pronounced in that the RTC already rendered a
decision on the merits of the said amended complaint, not to mention the Lu Ym
father and sons’ concurrence in the mootness of the issue in the instant petition.[54]
It is settled that courts do not
entertain a moot question. An issue
becomes moot and academic when it ceases to present a justiciable controversy,
so that a declaration on the issue would be of no practical use or value.[55] This Court, therefore, abstains from expressing
its opinion in a case where no legal relief is needed or called for.[56]
In G.R. No. 157381, the Lu Ym father and sons
insist that the CA had no jurisdiction to issue the writ of preliminary
injunction, more so, to make the same permanent, in view of the pendency of
G.R. No. 153690. They argue that the
application for a writ should have been filed before this Court and not through
a separate special civil action before the CA.
They further assert that the CA should not have issued a writ as there
was no finding of grave abuse of discretion, to begin with. Lastly, they argue that the order of the trial
court requiring the parties to amend their pleadings did not bar the RTC from
acting on the provisional remedy of receivership. Since this Court did not issue a restraining
order, the receivership proceedings could still proceed.[57]
It is noteworthy at this point to
reiterate the factual circumstances surrounding the instant petition. G.R. No. 157381 has its origin in the Lu Ym
father and sons’ motion to lift the receivership over LLDC. David,
for his part, went up to the CA and asked that the RTC be enjoined from hearing
said motion pending resolution of his petition before this Court in G.R. No.
153690 and the amendment of his complaint as ordered by the RTC. David’s petition was granted by the appellate
court in the assailed decision. It
ratiocinated that any matter, principal or collateral, should be held in
abeyance pending the amendment of the original complaint. Besides, said the appellate court, the
dismissal of the original complaint on which the Lu Ym father and sons based their
motion to lift receivership was still the subject of an appeal before this
Court.
Again,
the propriety of such injunction is mooted by the amendment of the complaint,
and the RTC decision in the case on the merits thereof. The appellate court ordered that the hearing
on the motion to lift the receivership be held in abeyance primarily because
the original complaint was yet to be amended. Upon the amendment of the complaint and the
admission thereof by the RTC, the reason for such injunction ceased to exist. Thus, the CA could resolve, as it in fact
resolved, the question of whether or not the receivership should be lifted.
The RTC decision on the merits of the
case gives this Court more reasons to declare the mootness of the instant
petition. It must be recalled that the
motion to lift the receivership was filed before the RTC ancillary to the
principal action, and what was sought to be enjoined was the hearing on that
particular motion. With the decision on
the merits rendered by the RTC, albeit still
on appeal, there is nothing more to be enjoined. More importantly, the RTC ordered that the
receivers cease from performing their functions and that a management committee
be created.[58] Clearly, these supervening events mooted the
petition. Time and again, we have
declared that a petition should be denied for the sole reason that the act
sought to be enjoined is already fait
accompli.[59]
To reiterate, the trial court’s decision
on the merits rendered the issue on the propriety of the injunction moot and
academic, notwithstanding the fact that said decision has been appealed to the
Court of Appeals.[60] Courts are called upon to resolve actual
cases and controversies, not to render advisory opinions.[61]
It is true that we have held in a
number of cases that the moot and academic principle is not a
magical formula that can automatically dissuade the courts from resolving a
case. Courts will still decide cases
otherwise, moot and academic if: first, there is a grave violation of
the Constitution; second, the
exceptional character of the situation and the paramount public interest is involved;
third, when the constitutional
issue raised requires formulation of controlling principles to guide the bench,
the bar, and the public; and, fourth,
the case is capable of repetition yet evading review.[62] However, not one of the enumerated exceptions
obtains in the instant case. Thus, a
denial of the instant petition is warranted.
In G.R. No. 170889, John Lu Ym and
LLDC explain that while it may be possible to raise the issue of docket fees in
their appellants’ brief as suggested by the CA, it would already be too late
because the issue would be rendered moot and academic by the dissolution of the
corporation. They further question the
propriety of the creation of the management committee, arguing that there was
non-observance of substantive and procedural rules. As to the issue of estoppel, they claim that
they first raised the issue of docket fees only in their motion for
reconsideration before the CA because they had yet to await the OCA’s response
to their inquiry on the correct docket fees.
Lastly, they argue that David et al. are now precluded from paying the
correct docket fees by the lapse of the prescriptive period. Neither can a lien be created on the judgment
in lieu of dismissal.[63]
In short, John and LLDC seek the
dismissal of the initial complaint on the ground of lack of jurisdiction occasioned
by the insufficient payment of docket fees.
A court acquires jurisdiction over a
case only upon the payment of the prescribed fees. The importance of filing fees cannot be
gainsaid for these are intended to take care of court expenses in the handling
of cases in terms of costs of supplies, use of equipment, salaries and fringe
benefits of personnel, and others, computed as to man-hours used in the
handling of each case. Hence, the
non-payment or insufficient payment of docket fees can entail tremendous losses
to the government in general and to the judiciary in particular.[64]
In the
instant case, however, we cannot grant the dismissal prayed for because of the following reasons: First,
the case instituted before the RTC is one incapable of pecuniary
estimation. Hence, the correct docket
fees were paid. Second, John and LLDC are estopped from questioning the
jurisdiction of the trial court because of their active participation in the
proceedings below, and because the issue of payment of insufficient docket fees
had been belatedly raised before the Court of Appeals, i.e., only in their motion for reconsideration. Lastly,
assuming that the docket fees paid were truly inadequate, the mistake was committed
by the Clerk of Court who assessed the same and not imputable to David; and as
to the deficiency, if any, the same may instead be considered a lien on the
judgment that may thereafter be rendered.
The Court
had, in the past, laid down the test in determining whether the subject matter
of an action is incapable of pecuniary estimation by ascertaining the nature of
the principal action or remedy sought.
If the action is primarily for recovery of a sum of money, the claim is
considered capable of pecuniary estimation.
However, where the basic issue is something other than the right to
recover a sum of money, the money claim being only incidental to or merely a
consequence of, the principal relief sought, the action is incapable of
pecuniary estimation.[65]
In the
current controversy, the main purpose of the complaint filed before the RTC was
the annulment of the issuance of the 600,000 LLDC shares of stocks because they
had been allegedly issued for less than their par value. Thus, David sought the dissolution of the
corporation and the appointment of receivers/management committee.[66] To be sure, the annulment of the shares, the
dissolution of the corporation and the appointment of receivers/management
committee are actions which do not consist in the recovery of a sum of money. If, in
the end, a sum of money or real property would be recovered, it would simply be
the consequence of such principal action.
Therefore, the case before the RTC was incapable of pecuniary estimation. Accordingly, John’s and LLDC’s contention
cannot be sustained. And since David
paid the docket fees for an action the subject of which was incapable of
pecuniary estimation, as computed by the Clerk of Court, the trial court validly
acquired jurisdiction over the case.
Even assuming that the subject in the
instant case is capable of pecuniary estimation, still, the case should not be
dismissed because the insufficiency of the fees actually paid was belatedly
raised; David relied on the assessment made by the Clerk of Court; and if there
is a deficiency, it may instead be considered a lien on the judgment that may
hereafter be rendered.
We note that the Lu Ym father and
sons belatedly raised the issue of insufficient payment of docket fees in their
motion for reconsideration before the CA.
A perusal of the records reveals that the Lu Ym father and sons filed
several pleadings before the RTC, specifically, a Motion to Dismiss and Motion
to Lift the Appointment of a Receiver, among others. They, likewise, filed several pleadings
before the Court of Appeals and before this Court either as initiatory pleadings
or in opposition to those filed by the adverse party. Considering their prompt action and reaction to
ensure that their rights are protected, their belated objection to the payment
of docket fees is, therefore, inexcusable.
Well-established is the rule that after vigorously participating in all
stages of the case before the trial court and even invoking the trial court’s
authority in order to ask for affirmative relief, John and LLDC are barred by
estoppel from challenging the trial court’s jurisdiction.[67] If a party invokes the jurisdiction of a
court, he cannot thereafter challenge the court’s jurisdiction in the same
case. To rule otherwise would amount to
speculating on the fortune of litigation, which is against the policy of the
Court.[68] Thus, even if, indeed, the docket fees paid
were inadequate, this allegation having been raised for the first time on
appeal, should be disallowed.[69]
While
it is true that this Court had previously dismissed complaints for non-payment
of docket fees, as in the early case of Manchester
Development Corporation v. Court of Appeals,[70] these
cases uniformly involved bad faith on the part of the plaintiff, such that the
correct amount of damages claimed was not specifically stated. The Court, in such cases, concluded that
there was bad faith on the part of the complainant and a clear intent to avoid
payment of the required docket fee, thus, the dismissal of the cases was
warranted.
It
may be recalled that despite the payment of insufficient fees, this Court refrained
from dismissing the complaint/petition in Intercontinental
Broadcasting Corporation (IBC-13) v. Alonzo-Legasto,[71] Yambao v. Court of Appeals[72]
and Ayala Land, Inc. v. Carpo.[73] In those cases, the inadequate payment was
caused by the erroneous assessment made by the Clerk of Court. In Intercontinental,[74] we declared that the payment of the docket
fees, as assessed, negates any imputation of bad faith to the respondent or any
intent of the latter to defraud the government.
Thus, when insufficient filing fees were initially paid by the
respondent, and there was no intention to defraud the government, the
In
the instant case, David paid the docket fees as assessed by the Clerk of
Court. Even if the amount was
insufficient, as claimed by John and LLDC, fraud and bad faith cannot be
attributed to David to warrant the dismissal of his complaint. Consistent with the principle of liberality
in the interpretation of the Rules, in the interest of substantial justice,
this Court had repeatedly refrained from dismissing the case on that ground
alone. Instead, it considered the
deficiency in the payment of the docket fees as a lien on the judgment which
must be remitted to the Clerk of Court of the court a quo upon the execution of the judgment.[77]
Lastly,
we now resolve the issue of whether or not the CA abused its discretion in
denying the Lu Ym father and sons’ application for a writ of preliminary
injunction. Section 3, Rule 58 of the
Rules of Court sets forth the requisites for the issuance of a writ of preliminary
injunction, thus:
(a) That the applicant is entitled to the relief demanded, and the whole or part of such relief consists in restraining the commission or continuance of the act or acts complained of, or in requiring the performance of an act or acts, either for a limited period or perpetually;
(b) That the commission, continuance or non-performance of the act or acts complained of during the litigation would probably work injustice to the applicant; or
(c) That a party, court, agency or a person is doing, threatening, or is attempting to do, or is procuring or suffering to be done, some act or acts probably in violation of the rights of the applicant respecting the subject of the action or proceeding, and tending to render the judgment ineffectual.
In
the instant case, John and LLDC failed to satisfy the above requisites. Except for their claim of nullity of the RTC
decision because of insufficient payment of docket fees, no evidence was
offered to establish the existence of a clear and unmistakable right on their
part that must be protected, as well as the serious damage or irreparable loss
that they would suffer if the writ is not granted.
It
has been consistently held that there is no power, the exercise of which is
more delicate, which requires greater caution, deliberation and sound
discretion, or more dangerous in a doubtful case than the issuance of an
injunction. It is the strong arm of
equity that should never be extended unless to cases of great injury, where
courts of law cannot afford an adequate or commensurate remedy in damages. Every court should remember that an
injunction is a limitation upon the freedom of action of the defendant and
should not be granted lightly or precipitately.
It should be granted only when the court is fully satisfied that the law
permits it and the emergency demands it.[78]
Clearly
then, no grave abuse of discretion can be attributed to the Court of Appeals in
denying the Lu Ym father and sons’ application for a writ of preliminary
injunction.
One
final note. We observe that these
consolidated cases involve interlocutory orders of the RTC. The delay in the disposition of the main case,
which is now pending appeal before the CA, was occasioned by the actions of all
the contending parties in seeking affirmative relief before the Court of Appeals
and before this Court. Our disposition
of these three petitions should now pave the way for the final resolution of
the corporate dispute which started as early as 2000.
In view of the above disquisitions,
we deem it proper to lift the status quo order
which this Court issued on
WHEREFORE, premises considered, the
petitions in G.R. Nos. 153690 and 157381 are DENIED for being moot and academic; while the petition in G.R. No.
170889 is DISMISSED for lack of
merit. Consequently, the Status Quo Order dated
The
Court of Appeals is DIRECTED to
proceed with CA-G.R. CV No. 81163 and to resolve the same with dispatch.
SO ORDERED.
ANTONIO
EDUARDO B. NACHURA
Associate Justice
WE CONCUR:
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
CONCHITA CARPIO MORALES MINITA
V. CHICO-NAZARIO
Associate Justice
Associate Justice
RUBEN T. REYES
Associate Justice
ATTESTATION
I attest that the
conclusions in the above Decision were reached in consultation before the case
was assigned to the writer of the opinion of the Court’s Division.
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson,
Third Division
CERTIFICATION
Pursuant to Section
13, Article VIII of the Constitution, and the Division Chairperson’s Attestation,
I certify that the conclusions in the above Decision were reached in
consultation before the case was assigned to the writer of the opinion of the
Court’s Division.
REYNATO
S. PUNO
Chief Justice
[1] Penned by Associate Justice Romeo
A. Brawner, with Associate Justices Elvi John S.
[2] It was later re-raffled to Branch
11.
[3] Pursuant to the Interim Rules of
Procedure Governing Intra-Corporate Controversies under R.A. 8799, the case was
re-docketed as SRC Case No. 021-CEB.
[4] Rollo (G.R. No. 153690), pp. 80-86.
[5] Penned by Associate Justice Eubolo
G. Verzola, with Associate Justices Sergio L. Pestaño and Amelita G. Tolentino,
concurring; rollo (G.R. No. 157381),
pp. 313-319.
[6] Penned by Associate Justice
Arsenio J. Magpale, with Associate Justices Vicente L. Yap and Ramon M. Bato,
Jr., concurring; rollo (G.R. No.
170889), pp. 72-73.
[7] Rollo (G.R. No. 170889), pp.
76-78.
[8] Rollo (G.R. No. 153690), p. 96.
[9]
[10]
[11]
[12]
[13]
[14]
[15]
[16]
[17] Rollo
( G.R. No. 157381), pp. 181-182.
[18] Rollo
(G.R. No. 153690), p. 555.
[19] Penned by Associate Justice Ma.
Alicia
[20]
[21]
[22] Penned by Associate Justice Romeo A.
Brawner, with Associate Justices Elvi John S.
[23] G.R. No. 139396, August 15, 2000,338
SCRA 62.
[24] Rollo
(G.R. No. 153690), pp. 69-78.
[25]
[26] Rollo (G.R. No. 157381), p. 316.
[27]
[28]
[29]
[30] Penned by Associate Justice Eubolo
G. Verzola, with Associate Justices Sergio L. Pestaño and Amelita G. Tolentino,
concurring; id. at 313-319.
[31] Rollo (G.R. No. 170889), p. 16.
[32]
[33]
[34]
[35]
[36]
[37]
[38] Penned by Associate Justice Arsenio
J. Magpale, with Associate Justices Vicente L. Yap and Ramon M. Bato, Jr.,
concurring; id. at 72-73.
[39] Rollo,
pp. 288-320.
[40]
[41] Rollo
(G.R. No. 153690), p. 623.
[42]
[43] Rollo
(G.R. No. 157381), pp. 17-52.
[44]
[45]
[46]
[47] Rollo
(G.R. No. 170889), pp. 483-484.
[48]
[49] Rollo
(G.R. No. 153690), pp. 613-637.
[50] Section 5, Rule 7 of the Rules of Court provides:
SEC. 5. Certification against forum shopping. – The plaintiff or principal party shall certify under oath in the complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto and simultaneously filed therewith: (a) that he has not theretofore commenced any action or filed any claim involving the same issues in any court, tribunal or quasi-judicial agency and, to the best of his knowledge, no such other action or claim is pending therein; (b) if there is such other pending action or claim, a complete statement of the present status thereof; and (c) if he should thereafter learn that the same or similar action or claim has been filed or is pending, he shall report that fact within five (5) days therefrom to the court wherein his aforesaid complaint or initiatory pleading has been filed.
Failure to comply with the foregoing requirements shall not be curable by mere amendment of the complaint or other initiatory pleading but shall be cause for the dismissal of the case without prejudice, unless otherwise provided, upon motion and after hearing. The submission of a false certification or non-compliance with any of the undertakings therein shall constitute indirect contempt of court, without prejudice to the corresponding administrative and criminal actions. If the acts of the party or his counsel clearly constitute willful and deliberate forum shopping, the same shall be ground for summary dismissal with prejudice and shall constitute direct contempt, as well as a cause for administrative sanctions.
[51] Rollo
(G.R. No. 153690), pp. 646-664.
[52] See Air Materiel Wing Savings and Loan Association, Inc., et al. v. Manay,
et al., G.R. No. 175338,
[53] Figuracion
v. Libi, G.R. No. 155688, November 28, 2007, citing The Philippine American Life & General Insurance Company v. Breva, 442 SCRA
217, 223 (2004); Negros Merchants Enterprises, Inc. v. China Banking Corporation,
G.R. No. 150918, August 17, 2007, 530 SCRA 478, 487.
[54] Rollo (G.R. No. 157381), pp. 654-657.
[55] Pulido v. Abu, G.R. No. 170924, July 4,
2007, 526 SCRA 483, 496; Garayblas v.
Atienza, Jr., G.R. No. 149493, June 22, 2006, 492 SCRA 202, 216.
[56] Pulido
v. Abu, id. at 496.
[57] Rollo
(G.R. No. 157381), pp. 17-52.
[58] Rollo
(G.R. No. 170889), pp. 119-120.
[59] Caneland
Sugar Corporation v. Alon, G.R. No. 142896,
[60] SeeKho v. Court of Appeals, G.R. No. 115758, March 19, 2002; See also La Vista Association, Inc. v. Court of
Appeals, 278 SCRA 498 (2002).
[61] Ticzon
v. Videopost,
[62] Manalo v.
Calderon, G.R. No. 178920, October 15, 2007, 536 SCRA 290, 303.
[63] Rollo
(G.R. No. 170889), pp. 464-559.
[64] Far
East Bank and Trust Company v. Shemberg Marketing Corporation, G.R. No. 163878,
[65] Far
East Bank and Trust Company v. Shemberg Marketing Corporation, id. at 700,
citing Singson v. Isabela Sawmill, 88
SCRA 623 (1970); Russell v. Hon. Vestil,
364 Phil. 392, 400 (1999).
[66] In their original complaint, David,
et.al. specifically prayed:
WHEREFORE, based on the foregoing premises, it is respectfully
prayed that this Honorable Court rule in favor of the Plaintiffs, as follows:
1.
Declare null and void the issuance of
600,000 unsubscribed and unissued shares to Defendants Lu Ym father and sons
and their spouses, children and holding companies, for a price of only
one-eighteenth of their real value, as having been done in breach of directors’
fiduciary duty to stockholders, in violation of Plaintiffs’ minority
stockholders’ rights, and in unjust enrichment of the Defendants,
majority/controlling
stockholders/directors, at the expense of their cousins, the other
stockholders.
2.
Order the dissolution of Defendant Ludo
and LuYm Development Corporation, in order to protect the rights and redress
the injuries of Plaintiffs;
3.
During the pendency of the instant case,
order the appointment of a receiver pendente
lite for LuDo and LuYm Development Corporation.
Such
other reliefs as may be just and equitable on the premises are likewise prayed
for; rollo, G.R. No. 170889, pp.
84-85.
In his amended
complaint, David specifically prayed:
WHEREFORE, based on the foregoing premises, it is respectfully
prayed that this Honorable Court rule in favor of the Plaintiffs, as follows:
1.
Declare null and void the issuance of
600.000 unsubscribed and unissued shares of the defendant corporation to
Defendants Lu Ym father and sons and their spouses, children, and holding
companies, for a price of one-eighteenth of their real value, for being
inequitable, having been done in breach of director’s fiduciary duty to
stockholders, in violation of Plaintiffs’ minority stockholders’ rights, and in
unjust enrichment of the Defendants, majority controlling
stockholders/directors, at the expense of their cousins, the other
stockholders.
2.
Order the dissolution of Defendant Ludo
and Luym Development Corporation, in order to protect the rights and redress
the injuries of Plaintiffs;
3.
Order the creation of a management
committee pendente lite, and order
receiver Luis Cañete to turn over all assets and records to the management
committee.
Such
other relief as may be just and equitable on the premises are likewise prayed
for. [Rollo (G.R. No. 153690), pp. 689-690.]
[67] Heirs
of Bertuldo Hinog v. Melicor, G.R. No. 140954, April 12, 2005, 455 SCRA
460, 473; Pantranco North Express, Inc.
v. Court of Appeals, G.R. No. 105180, July 5, 1993, 224 SCRA 477, 491.
[68] Heirs
of Bertuldo Hinog v. Melicor, id. at 473.
[69] Idolor
v. Court of Appeals, G.R. No. 161028,
[70] No. L-75919,
[71] G.R. No. 169108,
[72] G.R. No. 140894,
[73] G.R. No. 140162,
[74] Supra note 71, at 350.
[75] Supra note 72, at 148.
[76] Supra note 73, at 585.
[77] Moskowsky
v. Court of Appeals, 366 Phil. 189, 196 (1999); Pantranco North Express, Inc. v. Court of Appeals, G.R. No. 105180,
July 5, 1993, 224 SCRA 477, 491.
[78] Yujuico
v. Quiambao, G.R. No. 168639, January 29, 2007, 513 SCRA 243, 263; MIAA v. Court of Appeals, 445 Phil. 369,
382 (2003), citing Garcia v.