THIRD DIVISION
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QUASHA ANCHETA PEÑA & NOLASCO LAW OFFICE and LEGEND
INTERNATIONAL RESORTS, LIMITED, petitioners, - versus - THE SPECIAL SIXTH DIVISION of the COURT OF APPEALS, KHOO BOO BOON and the Law Firm of picazo buyco tan fider &
Respondents. |
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G.R. No. 182013 Present:
Chairperson, CHICO-NAZARIO, VELASCO,
JR., NACHURA,
and PERALTA,
JJ. Promulgated: December 4, 2009 |
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CHICO-NAZARIO, J.:
This is a special civil action for Certiorari under Rule 65 of the 1997
Revised Rules of Civil Procedure filed by petitioners Quasha Ancheta Peña and
Nolasco Law Office (Quasha Law Office) and Legend International Resorts,
Limited (LIRL), seeking to reverse and set aside, on the ground of grave abuse
of discretion amounting to lack or excess of jurisdiction, the Resolution[1]
dated 22 January 2008 of the Special Sixth Division of the Court of Appeals in
CA-G.R. CV No. 87281, which refused to recognize the Entry of Appearance of
petitioner Quasha Law Office as the duly authorized counsel of petitioner LIRL
in CA-G.R. CV No. 87281.
Petitioner Quasha Law Office is the
duly authorized counsel of petitioner LIRL in the
Private respondent Khoo Boo Boon was
the former Chief Executive Officer of LIRL-Subic. Private respondent Picazo Buyco Tan Fider and
Santos Law Office (Picazo Law Office) was the former counsel of petitioner LIRL
in the
The controversy in this case arose
from the following facts:
Petitioner LIRL filed a Complaint for Annulment of
Contract, Specific Performance with Damages and Application for Preliminary
Injunction and Temporary Restraining Order before the Regional Trial Court
(RTC) of Olongapo City, Branch 72, docketed as Civil Case No. 219-0-2004, against
PAGCOR and SBMA for amending the 19 March 1993 Agreement, notwithstanding the
total absence of any consideration supporting petitioner LIRL’s additional
obligations imposed under the amended Agreement.
On
Resultantly, PAGCOR filed its Notice of Appeal Ad Cautelam before the Special Sixth
Division of the Court of Appeals, and the case was docketed as CA-G.R. CV No.
87281.
Meanwhile, in relation to petitioner LIRL Companies’
Winding-Up No. 1139 of 2004 filed before the Hong Kong Court of First Instance
(Hong Kong Court), the said foreign court issued Orders dated 9 June 2006 appointing
Kelvin Edward Flynn (Flynn) and Cosimo Borrelli (Borrelli) as the joint and
several liquidators of petitioner LIRL and granting them the power to carry on
and manage the business of petitioner LIRL, including its business in Subic,
Philippines. Pursuant to the said
Orders, Flynn sent a letter[4]
dated
Accordingly, petitioner Quasha Law Office filed its Entry
of Appearance as counsel for petitioner LIRL in CA-G.R. CV No. 87281 pending
before the Special Sixth Division of the Court of Appeals, through a
Manifestation and Motion Ex Abudante
Cautelam attaching thereto a copy of the letter dated 10 July 2006
terminating the services of Picazo Law Office and engaging the services of
petitioner Quasha Law Office.
In a Resolution[6]
dated
Petitioners moved for the reconsideration of the aforesaid
Resolution, but their Motion was denied in a Resolution[8]
dated
Petitioners filed a Manifestation with the Special Sixth
Division of the Court of Appeals that in a related case filed before the
Special Tenth Division of the appellate court, docketed as CA-G.R. SP No.
96717, the said Division issued a Decision[9]
dated
On
Hence, this Petition.
The grounds relied upon by the petitioners for the
allowance of this Petition are as follows:
I.
WHETHER OR NOT THE SPECIAL SIXTH DIVISION OF THE COURT OF APPEALS
COMMITTED PATENT GRAVE ABUSE OF DISCRETION, AMOUNTING TO EXCESS OF
JURISDICTION, WHEN IT REFUSED TO GIVE DUE DEFERENCE TO A DECISION OF A
CO-DIVISION OF THE SAME COURT.
i.
THE DECISION OF THE COURT OF APPEALS IN CA-G.R. SP NO. 96717 HAS BECOME
FINAL AND EXECUTORY CONSIDERING THAT THE PETITION FOR REVIEW ON CERTIORARI FILED BY [PRIVATE RESPONDENT
PICAZO LAW OFFICE] WAS DISMISSED OUTRIGHT BY THE SECOND DIVISION OF THIS
II
IN A RELATED CASE WHERE THE ISSUE OF [PETITIONER QUASHA LAW OFFICE’S]
AUTHORITY WAS RAISED, THE SEVENTH DIVISION OF THE COURT OF APPEALS SUSTAINED
[PETITIONER QUASHA LAW OFFICE’S]
III
WHETHER OR NOT SECTION 48, RULE 39 OF THE 1997 REVISED RULES OF CIVIL PROCEDURE
ON RECOGNITION AND ENFORCEMENT OF FOREIGN JUDGMENT APPLIES IN THIS CASE.
i
SECTION 48, RULE 39 PRESUPPOSES THAT A FOREIGN JUDGMENT, REPRESENTING A
CLAIM, IS SOUGHT TO BE ENFORCED AGAINST A SPECIFIC THING OR AGAINST A PERSON.
ii
COROLLARY TO THE ABOVE, THE ORDERS OF THE HONG KONG COURT DO NOT ASSERT A
CLAIM AGAINST LIRL-SUBIC BRANCH, THE APPOINTMENT OF LIQUIDATORS IS A PURELY
INTERNAL MATTER BETWEEN A CORPORATION AND A MERE BRANCH THEREOF.
iii
[PETITIONER] LIRL-SUBIC BRANCH, WHICH [PRIVATE RESPONDENT] MR. KHOO BOO
BOON PURPORTEDLY REPRESENTS, CANNOT ASSAIL THE ORDERS OF THE
IV
[PRIVATE RESPONDENT] PICAZO LAW OFFICE AS COUNSEL DERIVES ITS AUTHORITY
FROM [PRIVATE RESPONDENT] MR. KHOO BOO BOON, THE FORMER CHIEF [EXECUTIVE]
OFFICER OF [PETITIONER] LIRL.
i
[PRIVATE RESPONDENT] MR. KHOO BOO BOON IS NO LONGER THE CHIEF EXECUTIVE
OFFICER, HAVING RECOGNIZED THE APPOINTED LIQUIDATORS OF [PETITIONER] LIRL BY
VOLUNTARILY YIELDING CONTROL AND MANAGEMENT OF LIRL-SUBIC BRANCH.
ii
COROLLARY TO THE ABOVE, THE AUTHORITY OF [PRIVATE REPSONDENT] PICAZO LAW
[OFFICE] TO REPRESENT [PETITIONER] LIRL HAS BEEN TERMINATED BY THE APPOINTED
LIQUIDATORS.[10]
On
Even if we
are to resolve the issues in the case at bar on their merits, we will
nevertheless arrive at the same conclusion.
Basically, the aforesaid grounds are the very
arguments of the petitioners. Thus, the
issues in this case may be summed up into: (1) whether the Special Sixth
Division of the Court of Appeals acted with grave abuse of discretion in not
giving due deference to a Decision of its co-division, which similarly resolved
the issue of proper legal representation of petitioner LIRL; and (2) whether
the Special Sixth Division of the Court of Appeals gravely abused its
discretion in considering that the Orders of the Hong Kong Court appointing
liquidators for petitioner LIRL involved enforcement and recognition of a foreign
judgment.
In CA-G.R.
SP No. 96717 entitled “In the Matter of Corporate Rehabilitation of Legend
International Resorts Limited,” which was raffled to the Special Tenth Division
of the Court of Appeals, petitioner LIRL’s proper legal representation was
raised as one of the issues. In the said
case, petitioner Quasha Law Office’s authority to represent petitioner LIRL was
questioned by private respondent Picazo Law Office, petitioner LIRL’s former counsel
whose legal services had been terminated by petitioner LIRL’s appointed
liquidators. Private respondent Picazo
Law Office argued that the Orders of the
On
The said
Decision of the Special Tenth Division of the Court of Appeals was immediately
brought by the petitioners to the attention of the Special Sixth Division of
the said appellate court where CA-G.R. CV No. 87281 (the subject of this
Petition) was pending. However, the
Special Sixth Division of the Court of Appeals merely noted the same and still
refused to recognize petitioner Quasha Law Office’s entry of appearance. It even advised petitioner Quasha Law Office
to elevate to this Court the issue of who between petitioner Quasha Law Office
and private respondent Picazo Law Office can legally represent petitioner LIRL
in the instant case.
Thus,
petitioners ascribe grave abuse of discretion on the part of the Special Sixth
Division of the Court of Appeals in not giving due deference to the decision of
its co-division.
Grave abuse
of discretion means a capricious and whimsical exercise of judgment as is
equivalent to lack of jurisdiction. Mere abuse of discretion is not
enough; it must be so grave as when the power is exercised in an arbitrary or
despotic manner by reason of passion or personal hostility, and must be so
patent and so gross as to amount to an evasion of a positive duty or to a
virtual refusal to perform the duty enjoined or to act at all in contemplation
of law.[11]
In the case
at bar, this Court holds that there was no grave abuse of discretion amounting
to lack or excess of jurisdiction committed by the Special Sixth Division of
the Court of Appeals in not giving due deference to the decision of its
co-division. As correctly pointed out by
the Special Sixth Division of the Court of Appeals, the decision of its
co-division is not binding on its other division. Further, it must be stressed that judicial
decisions that form part of our legal system are only the decisions of the
Supreme Court.[12] Moreover, at the time petitioners made the
aforesaid Manifestation, the Decision dated
Therefore,
the Special Sixth Division of the Court of Appeals cannot be faulted for not
giving due deference to the said Decision of its co-division, and its actuation
cannot be considered grave abuse of discretion amounting to lack or excess of
its jurisdiction.
However, as
regards the second issue of whether the Special Sixth Division of the Court of
Appeals gravely abused its discretion in considering that the Orders of the
Hong Kong Court appointing liquidators for petitioner LIRL involved enforcement
and recognition of a foreign judgment, we hold that the same is already barred
by the principle of res judicata—conclusiveness
of judgment.
The
doctrine of res judicata actually
embraces two different concepts: (1) bar by former judgment and (b)
conclusiveness of judgment.
The second
concept – conclusiveness of judgment – states that a fact or question, which
was in issue in a former suit and was there judicially passed upon and
determined by a court of competent jurisdiction, is conclusively settled by the
judgment therein as far as the parties to that action and persons in privity
with them are concerned and cannot be again litigated in any future action
between such parties or their privies in the same court or any other court of
concurrent jurisdiction on either the same or a different cause of action,
while the judgment remains unreversed by proper authority. It has been held
that in order that a judgment in one action can be conclusive as to a
particular matter in another action between the same parties or their privies, it
is essential that the issue be identical. If a particular point or question
is in issue in the second action, and the judgment will depend on the
determination of that particular point or question, a former judgment between
the same parties or their privies will be final and conclusive in the second if
that same point or question was in issue and adjudicated in the first suit. Identity
of cause of action is not required, but merely identity of issues.[13]
Legarda v. Savellano[14] elucidates
the rationale for respecting the conclusiveness of judgment, thus –
As we have repeatedly enunciated, public
policy and sound practice enshrine the fundamental principle upon which the
doctrine of res judicata rests that
parties ought not to be permitted to litigate the same issues more than once. It
is a general rule common to all civilized system of jurisprudence, that the
solemn and deliberate sentence of the law, pronounced by its appointed organs,
upon a disputed fact or a state of facts, should be regarded as a final and
conclusive determination of the question litigated, and should forever set the
controversy at rest. Indeed, it has been well said that this maxim is more than
a mere rule of law; more even than an important principle of public policy; and
that it is not too much to say that it is a fundamental concept in the
organization of every jural sytem.
Public policy and sound practice demand that, at the risk of occasional errors,
judgments of courts should become final at some definite date fixed by law. The
very object for which courts were constituted was to put an end to
controversies.
It must be
stressed that the Decision dated 14 December 2007 in CA-G.R. SP No. 96717 of
the Special Tenth Division of the Court of Appeals was appealed to this
Court via a Petition for Review on Certiorari under Rule 45 and was
docketed as G.R No. 184463.
The said Decision resolved the issue of petitioner LIRL’s proper legal
representation in favor of petitioner Quasha Law Office. It also ruled that there was no enforcement
of a foreign judgment when one of the appointed liquidators terminated the
legal services of private respondent Picazo Law Office and engaged in its stead
petitioner Quasha Law Office to be the duly authorized counsel of petitioner
LIRL. What is involved is the
prerogative of petitioner LIRL, through its duly authorized representative --
which, in this case, is its appointed liquidators -- to terminate and engage
the services of a counsel, which is an internal affair that requires no prior
recognition in a separate action.[15] On
In a
related case filed before the Seventh Division of the Court of Appeals
docketed as CA-G.R. SP No. 98893,[16]
petitioner LIRL’s proper legal representation and Quasha Law Office’s entry of
appearance as tantamount to an enforcement of a foreign judgment, were also
raised. On
The aforesaid
Decision of the Seventh Division of the Court of Appeals was appealed to
this Court via a Petition for Review
on Certiorari under Rule 45 of the
1997 Revised Rules of Civil Procedure, docketed as G.R. No. 189265. On 12 October 2009, this Court rendered a
Resolution denying the Petition for late filing, for failure to serve a copy of
the Petition to the Court of Appeals, for lack of the required number of plain
copies of the Petition, and for failure to sufficiently show any reversible
error. Thus, the Decision dated
It has already been settled in the aforesaid two
Decisions that the Orders of the
WHEREFORE, premises considered, the
instant Petition for Certiorari, is
hereby DISMISSED. No costs.
SO ORDERED.
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MINITA V. CHICO-NAZARIO
Associate Justice |
WE CONCUR:
RENATO C.
CORONA
Associate Justice
Chairperson
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PRESBITERO
J. VELASCO, JR. Associate Justice |
ANTONIO EDUARDO B. NACHURA Associate Justice |
DIOSDADO M. PERALTA
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.
RENATO C. CORONA
Associate Justice
Chairperson,
Third Division
CERTIFICATION
Pursuant to Section 13, Article VIII
of the Constitution, and the Division Chairperson’s Attestation, it is hereby
certified 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 Ramon M. Bato, Jr. with Associate Justices Andres B. Reyes, Jr. and Rosmari D. Carandang, concurring; rollo, pp. 53-54.
[2] Penned by Judge Eliodoro G. Ubiadas, id. at 93-101.
[3]
[4]
[5]
[6] Penned by Associate Justice Ramon M. Bato, Jr. with Associate Justices Andres B. Reyes, Jr. and Rosmari D. Carandang, concurring. Rollo, pp. 119-120.
[7]
[8] CA rollo, pp. 346-348.
[9] Penned by Associate Justice Apolinario D. Bruselas, Jr. with Associate Justices Bienvenido L. Reyes and Fernanda Lampas Peralta, concurring; rollo, pp. 135-147.
[10]
[11] Suliguin
v. The Commission on Elections, G.R. No. 166046,
[12] Government
Service Insurance System v.
[13] Heirs
of Clemencia Parasac v. Republic of the
[14] G.R. No. L-38892,
[15] Rollo, p. 141.
[16] This case stemmed from a Complaint for Breach of Agreement and Damages filed by PAGCOR against LIRL docketed as Civil Case No. 04-109372.
[17] Rollo, pp. 299-300.