Professional Documents
Culture Documents
administrator
in
the
Philippines,
there
was
nothing
Appellant.
appellee.
of
party
or
entity.
4.
CORPORATION
LAW;
CORPORATIONS;
CONCEPT
AND
SYLLABUS
administration
is
necessary
or
the
reason
for
such
its
individual
stockholders
(1
Fletcher,
Cyclopedia
DECISION
FERNANDO, J.:
Idonah Slade Perkins, who died in New York City on March 27,
settle her estate and satisfy the claims of local creditors (Rule
corporation,
Ghezzi
v.
Manufacturers
Life
Ins.
Co.,
90
Phil.
459).
Benguet
Consolidated,
Inc.,
to
satisfy
the
U.S.A..
."
Court."
certain
requirements
certificates
could
of
be
its
by-laws
issued.
before
Hence,
new
its
stock
appeal.
legal
order
doctrines
of
weight
and
significance.
be
stigmatized
as
illegal?
The facts will explain why. As set forth in the brief of appellant
March 27, 1960 in New York City, left among others, two stock
certificates
the
principles
considerations.
covering
33,002
shares
of
appellant,
and
supported
by
the
strongest
policy
It can truly be said then that the result arrived at upheld and
15, 1963. Thus did the lower court, in the order now on
declared
[or]
considered
as
lost."
authority.
inherent in his duty to settle her estate and satisfy the claims
administration,
certainly
over
property
whether
in
principal
another
or
state
ancillary,
or
country."
the trial Judge knew, and does know, and it is admitted by the
New
York."
10
lower court. That certainly does not suffice to call for the
not ex proprio vigore have any effect beyond the limits of the
corporation
administrator
fulfilled.
distributed
among
his
heirs."
owned
in
by
the
the
decedent
Philippines,
to
the
ancillary
there
was
nothing
7
Any other view would result in the compliance to a valid
powerless
to
remedy
its
flagrant
disregard.
court
orders.
important
part
in
its
development."
11
so
minded.
of
it
but
yield
to
its
alleged
controlling
force.
its inconsistency with one of its by-laws does not impress us.
at times hides itself from view till reflection and analysis have
brought
it
What
be
to
the
light."
14
disputed,
therefore,
is
the
at
times
of
judicial
authority.
basic
postulates
of
corporate
theory.
corporation
precisely
as
"an
artificial
being
invisible,
[a]
court
regarding
the
ownership
[thereof]."
15
the
matter
neatly.
20
estate in the jural order that a court must not only take note
tribunals
subordinate
Administrator."cralaw
of
judicial
discretion
and
instrumentalities
render
of
them
the
mere
Veterans
virtua1aw
library
proceeding
is
cast
upon
it.
honor
of
the
country.
succeed.
response
The
deplorable
from
us.
That
consequences
is
what
attendant
appellant
will
on
get.
That is all then that this case presents. It is obvious why the
not settle the issue. What carries weight and conviction is the
judge
soundest
or
judges
of
the
United
States
court."
23
of
legal
doctrines
and
distinguished
by
its
court. Thus: "We are of the opinion that the appeal should be
honor
maintained.
Santos, the Judge of the Court of First Instance, dated May 18,
EN
BANC
[G.R.
No.
L-17295.
July
30,
1962.
Appellee.
Felicisimo
E.
Escaran,
for Plaintiffs-Appellants.
Amendment
to
partnership."cralaw
the
Articles
of
virtua1aw
Colibrary
SYLLABUS
Republic
Act
No.
1180.
It appears that on May 1, 1953, Ang Pue and Tan Siong, both
partnership
necessary
to
impose.
was
"to
maintain
the
business
of
general
corresponding
state through Congress had the right to enact Republic Act No.
Commission
articles
of
partnership
on
June
(Exhibit
B)
16,
were
1953.
term of the partnership Ang Pue & Company, but after the
Republic Act 1180 were already in force, and there can be not
another
said Act.
the
DECISION
DIZON, J.:
five
years.
When
the
amended
articles
aforesaid
were
Act.
costs,
the
plaintiffs
interposed
this
appeal.
KAPUNAN, J.:
library
red
their
term
of
life.
follows:chanrob1es
virtual
1aw
library
The late Manuel A. Torres, Jr. (Judge Torres for brevity) was the
majority
follows:chanrob1es
stockholder
of
Tormil
Realty
virtual
&
Development
1aw
library
were already in force, and there can be not the slightest doubt
that the right claimed by appellants to extend the original
Manuel
A.
Torres,
Jr.
100,120
57.21
Dir./Pres./Chair
33,430
19.10
Dir./Treasurer
Milagros
Josefina
P.
P.
Torres
Torres
8,290
4.73
Dir./Ass.
Cor-Sec.
costs.
Ma.
FIRST
[G.R.
DIVISION
No.
120138.
September
5,
1997.]
RODOLFO
JURISPRUDENCIA,
EDGARDO
D.
L.
JOCSON,
AUGUSTUS
JR.,
MELVIN
CESAR
PABALAN, Petitioners,
AZURA
v.
COURT
S.
and
OF
REALTY
&
DEVELOPMENT
CORPORATION,
T.
MORALES
MORALES, Respondents.
and
DANTE
D.
Cristina
Antonio
P.
Ma.
Jacinta
Ma.
Luisa
Dante
D.
T.
Carlos
Torres,
P.
T.
8,290
4.73
Dir./Cor-Sec.
Jr.
8,290
4.73
Director
Torres
8,290
4.73
Director
Morales
7,790
4.45
Director
Morales
500
.28
Director
DECISION
Judge
Torres:chanrob1es
virtual
1aw
library
Likewise, all the assigned parcels of land were duly registered
TO
Realty, except for the ones located in Makati and Pasay City.
BE
ISSUED
1.
July
13,
1984
TCT
81834
Quezon
City
13,252
TCT
2.
144240
July
13,
Quezon
1984
TCT
City
77008
Manila
24
&
25).
TCT
65689
Manila
78,493
TCT
109200
Manila
3.
July
13,
1984
TCT
374079
Makati
8,307
4.
July
24,
1984
TCT
41527
Pasay
Noting the disappearance of the Makati and Pasay City
TCT
41528
Pasay
9,855
TCT
41529
Pasay
5.
Aug.
06,
1984
El
Hogar
Filipino
Stocks
2,000
6.
Aug.
06,
1984
Manila
Jockey
Club
Stocks
48,737
7.
Aug.
07,
1984
San
Miguel
Corp.
Stocks
50,283
8.
Aug.
07,
1984
China
Banking
Corp.
Stocks
6,300
9.
Aug.
20,
1984
Ayala
Corp.
Stocks
7,468
10.
Aug.
29,
1984
Ayala
Fund
Stocks
1,322
225,972
transferred
to
Tormil.
directors.
records.
one
Jocson,
attendance
(1)
share
each
to
petitioners
Tobias,
in
the
meeting.
nominees.
At about 2:30 p.m., a group composed of Edgardo Pabalan,
The assigned shares were covered by corresponding Tormil
Stock Certificates Nos. 030, 029, 028, 027, 026 and at the
back
is
library
of
each
certificate
found:chanrob1es
the
virtual
following
inscription
1aw
shares
by
Manuel
Torres.
Jr.
when asked about the quorum, said that there was more than
sole
purpose
of
qualifying
me
as
Director;
of
Assignee)
requested time to study the said reports and brought out the
question of auditing the finances of the corporation which he
where,
the
corporation, the late Judge held only a single seat in the nine-
notwithstanding
his
controlling
interest
in
proceedings.
Mr.
decision
making
functions."
Pabalan
suggested
that
the
opinion
of
the
SEC
were
just
observers.
Jocson,
Jr.
as
Acting
Secretary.
Board. At this juncture, Milagros Torres cried out and told the
group
of
Manuel
Torres,
Jr.
to
leave
the
house.
group with Manuel Torres, Jr. the one who requested for S.E.C.
stock
and
still
constituted
quorum.
WHEREFORE,
rendered
premises
as
considered,
follows:chanrob1es
judgment
virtual
is
hereby
1aw
library
virtual
1aw
library
1.
Ordering
and
directing
the
respondents,
particularly
Manuel
Torres,
Jr.
2.
Ma.
Jacinta
Torres
3.
Edgardo
Pabalan
4.
Graciano
Tobias
5.
Rodolfo
Jocson,
Jr.
6.
Melvin
Jurisprudencia
7.
Augustus
Cesar
Azura
directors,
officers
authorized
8.
Josefina
9.
Dante
and
stockholders
representatives
and/or
their
or
duly
auditors;
Torres
2. Declaring as permanent and final the writ of preliminary
Morales
virtual
1aw
library
After the election, it was resolved that after the meeting, the
new board of directors shall convene for the election of
officers.
Consequently,
on
10
April
1987,
private
respondents
March
25,
1987;
Board
of
Directors
be
annulled.
(P100,000.00)
as
and
by
way
of
attorneys
fees.
assignment
stockholders
of
shares
right
corporations
of
to
them
pre-emption
articles
violated
as
the
provided
and
minority
in
the
by-laws.
consolidated
for
joint
hearing
and
Manifestation
dated
24
April
1991.
adjudication.
On 8 June 1993, petitioners filed a Motion to Suspend
library
Proc. No. M-1768 ("In the Matter of the Issuance of the Last
June
1993
and
July
1993.
petitioners
TO
aforecited
motions
on
the
following
PROCEDURAL
DUE
PROCESS;
ground:jgc:chanrobles.com.ph
(2)
"Before the filing of these motions, the Commission en banc
had already completed all proceedings and had likewise ruled
these
motions
to
suspend
proceedings."
10
1aw
library
GESTIO;
WHEREFORE, premises considered, the appealed decision of
the hearing panel is hereby affirmed and all motions pending
(3)
SO
ORDERED.
11
review
(docketed
as
CA-G.R.
SP
No.
31748).
CODE)
On 23 May 1994, the Court of Appeals rendered a decision,
AS
SO
ERRONEOUSLY
RESPONDENT
CHARACTERIZED
BY
S.E.C.;
THE
and,
decision
is
accordingly
affirmed.
SO
ORDERED.
12
NOT
HAVING
ACTUALLY
BEEN
EXAMINED,
THAT
THE
Court
BOOK
of
Appeals
dated
10
May
1995.
13
BY
AN
ACTING
CORPORATE
SECRETARY
AND
TIMELY
MADE
TO
THE
OTHER
(1)
STOCKHOLDERS.
14
b)
it
required
the
parties
to
submit
outrightly
dismissing
"simultaneous
the
same;
records
should
have
been
forwarded
to
said
court.
that:chanrob1es
virtual
1aw
library
non curat lex (this, without first determining the true extent of
assailed
decision
of
respondent
S.E.C.
15
Petitioners
contention
is
unmeritorious.
gave due course to the petition. The fact alone that the Court
of Appeals issued a restraining order and a writ of preliminary
injunction and required the parties to submit their respective
memoranda does not indicate that the petition was given due
notice that the petition has been given due course, the court,
status quo pending the disposition of the case. The court can
subsequent
discretion
correction
or
addition
to
the
record.
of
the
court.
acts:chanrobles.com.ph
virtual
law
library
clarified
thus:chanrob1es
virtual
1aw
library
for the filing thereof, and on the bases of the petition or the
record the Court of Appeals finds prima facie that the court or
writ
of
preliminary
injunction;
would
warrant
reversal
award,
binding
on
or
modification
the
Court
of
the
of
Appeals.
may
appoint
guardian
ad
litem
for
the
minor
heirs.
probate of the late Judge Torres will was pending, had yet to
correction
of
or
addition
to
the
record.
(Underscoring
ours.)
We
are
not
aforequoted
unaware
of
the
principle
provision:chanrob1es
virtual
underlying
1aw
the
library
and the judgment rendered after such trial, are null and void
the
basis
of
the
uncontroverted
facts
and
admissions
and
the
judgment
are
not
binding.
16
Court of Appeals are null and void for being rendered without
were
as
library
of
the
Revised
Rules
follows:chanrob1es
of
Court,
virtual
which
provides
1aw
opposed
by
the
same
parties,
herein
private
specified
by
the
court,
and
the
representative
shall
not
necessary
petitioners
that
jurisdictional
proceedings.
on
when
belated
the
and
appointment
themselves
seemingly
of
requirements
rendered
heirs
legal
per
se
ostensible
voluntarily
claim
representative
but
therein.
because
of
are
non-
thus:chanrob1es
on April 3, 1991, the SEC en banc had already fully heard the
virtual
1aw
library
and
rendition
of
the
judgment.
during
not
only after more than two (2) years from the death of Judge
the
pendency
of
proceedings
of
nature
representative
the
when the probate court will decide the issue, which may still
be
is
the
very
guarantee
is
for him
essence
of
of
duly named
the
and
constitutionally
due
within
appealed
to
the
higher
courts.
enshrined
process.
rendered after such trial, are null and void because the court
this case in view of its peculiar situation where the estate was
property or business.
and
III
In
Quezon
Universal
Food
City
Corp.
held:chanrob1es
v.
CA,
properties.
the
virtual
Supreme
1aw
Court
library
Petitioners find legal basis for Judge Torres act of revoking the
provides
object
that:chanrob1es
virtual
1aw
library
of
the
parties
in
making
the
agreement.
with
what
is
incumbent
upon
him.
just
cause
authorizing
the
fixing
of
period.
46.)
21
articles
1385
and
1388
and
the
Mortgage
Law.
for his Makati and Pasay City properties. The records thus
the
disclose:chanrob1es
Court
of
Appeals:chanrob1es
virtual
1aw
library
from
(Rollo,
pp.
45-46)
that
virtual
1aw
library
ASSIGNMENT
ASSIGNED
TO
BE
ISSUED
COMPLIANCE*
Torres
to
unilaterally
revoke
the
deeds
of
wherein
he
voluntarily
assigned
to
TORMIL
real
TCT
144240
Quezon
City
41528
and
41529
(Pasay)
respectively.
2.
July
TCT
13,
65689
1984
TCT
Manila
77008
Manila
78,493
2nd
TCT
102200
Manila
3.
July
13,
1984
TCT
374079
Makati
8,307
1st
4.
July
24,
1984
TCT
41527
Pasay
Petitioners further argue that:chanrob1es virtual 1aw library
TCT
41528
Pasay
9,855
4th
10.10. Certainly, there is no legal or just basis for the
TCT
41529
Pasay
9.
August
20,
1984
Ayala
Ayala
Corp.
Fund
Stocks
Stocks
7,468.2)
1,322.1)
9th
10.12. Indeed it was a practice in the corporate respondent, a
family corporation with only a measly number of stockholders,
225,972.3
obtained
immediately
prior
to
the
1987
annual
entries
now
in
question;
10.13. Surely, it would have been futile nay foolish for him to
August
1984.
23
nominees;
24
Petitioners
contentions
lack
merit.
Judge
belonged
Torres.
to
the
opposite
faction.
It
is
the
corporate
practices
other
than
those
established
by
law.
on certiorari is
hereby
DENIED.
virtual
1aw
library
SECOND
DIVISION
[G.R.
No.
125469.
October
27,
1997.]
and
necessary
entries
therein.
EXCHANGE COMMISSION
stock and transfer book of TORMIL, was not kept by Ms. Maria
INC.,Respondents.
DECISION
entries made are not valid, Pabalan and Co. cannot therefore
any holder of the stock and transfer book, though not the
holds
81.28% of the
the
corporate
secretary.
26
Land, Inc. to be listed in its stock market, thus paving the way
for
the
public
offering
of
PALIs
shares.
The facts of the case are undisputed, and are hereby restated
in
sum.
1995, PALI was issued a Permit to Sell its shares to the public
Case
No.
65561,
pending
in
Branch
69
thereof.
shares,
with
supporting
documents
attached.
the
stock
exchange.
application of PALI for the listing of its shares with the PSE,
6(j) of P.D. No. 902-A, review the PSEs action on PALIs listing
under
the
circumstances.
On the same date, or on April 11, 1996, the SEC wrote to the
PSE, attaching thereto the letter of PALI and directing the PSE
Panlilio for then President Marcos and now, effectively for his
to file its comments thereto within five days from its receipt
was
requested
to
comment
upon
the
said
letter.
the SEC containing its comments to the April 11, 1996 letter
PALIs answer stated that the properties forming part of the
of
PALI.
Puerto Azul Beach Hotel and Resort Complex were not claimed
by PALI as its assets. On the contrary, the resort is actually
On April 24, 1996, the SEC rendered its Order, reversing the
reads:jgc:chanrobles.com.ph
"WHEREFORE,
name
of
PALI.chanroblesvirtual|awlibrary
premises
considered,
and
invoking
the
Gunigundo
Good
of
the
Presidential
Commission
on
the PALI and the Marcoses. On March 4, 1996, the PSE was
the
investing
public.
On June 4, 1996, PALI filed its Comment to the Petition for
This
Order
shall
take
effect
immediately.
SO
ORDERED."cralaw
virtua1aw
library
Opposition
to
Motion
to
Dismiss.chanroblesvirtuallawlibrary:red
PSE filed a motion for reconsideration of the said order on
April 29, 1996, which was, however denied by the Commission
Petition
by
the
PSE.
The appellate court had ruled that the SEC had both
information."cralaw
virtua1aw
library
the
the
library
SEC,
submitting
SEC:chanrob1es
the
following
virtual
as
1aw
errors
of
DECISIONS
necessarily
OF
PSE
ON
LISTING
APPLICATIONS;
comes
within
its
authority.
All in all, the court held that PALI complied with all the
the
effect
that:jgc:chanrobles.com.ph
APPLICATION;
". . . the Philippine Stock Exchange has acted in an arbitrary
III. THE ASSAILED ORDERS OF SEC ARE ILLEGAL AND VOID
listing
considerations:chanrob1es
RESERVATION;
of
its
shares
in
the
face
virtual
of
the
1aw
following
library
AND
1. PALI has clearly and admittedly complied with the Listing
CONSTITUTION.
on January 17, 1997, whereas the PSE filed its own Comment
on
allowed
listing
in
the
January
20,
1997.
Exchange;
On February 25, 1996, the PSE filed its Consolidated Reply to
properties were even less serious than the claims against the
PSE submits that the Court of Appeals erred in ruling that the
SEC had authority to order the PSE to list the shares of PALI in
evidence
of
ownership
thereof;
can
be
listed."cralaw
virtua1aw
library
point is, the PALI properties are now titled. A property loses its
bad faith on the part of the PSE. Under the listing rules of the
corporations.
determines that the listing shall not serve the interests of the
investing
public.
sequestered
October 17, 1996. On the same date, the PCGG filed a Motion
the "law of the case" between the Republic and TDC and
corporations,
nor
with
corporations
whose
1986
public
and
April
4,
1988.
may
be
fully
safeguarded.
and more than one year has since lapsed, is erroneous and
permit
is
void.
issued
concession
of
by
its
the
government
corporate
to
franchise
operate
from
the
in
the
state.
The SECs power to look into the subject ruling of the PSE,
records reveal the truth that PALI did not comply with the
documents
supporting
misrepresentations
and
its
application
misleading
contained
statements,
and
of PALIs properties and the fact that the same form part of
application.
Thus, it was in the alleged exercise of this authority that the
It is undeniable that the petitioner PSE is not an ordinary
We affirm that the SEC is the entity with the primary say as to
As
administration
and
regulation
of
stock
exchanges.
the
appellate
court
explains:jgc:chanrobles.com.ph
the economy moves on the basis of the rise and fall of stocks
can dictate which and how many users are allowed to sell
repeat,
lawlibrary
the
monopoly,
unless
accompanied
by
control,
virtua1aw
library
of
sequestration
has
been
issued
covering
the
implied
powers.
protection
to
the
investing
public
against
fraudulent
worthless
ventures.
14
thus:jgc:chanrobles.com.ph
interfere
with
the
same.
Questions
of
policy
and
of
directors.
The
board
is
the
business
manager
of
the
business
not
reviewable
by
the
courts.
12
seeking
to
obtain
capital
through
honest
As has been pointed out, the effects of such an act are chiefly
was held that bad faith does not simply connote bad judgment
the Court finds that the SEC had acted arbitrarily in arrogating
inaccurate
in
any
Commission
to
material
issue
respect,
stop
and
order
empower
the
suspending
the
the
absence
of
bad
faith.
virtua1aw
library
public
welfare
is
safeguarded.
remain
so.
flaw.
refusing
the application
for
the
Rejection
of
the
registration
of
security:jgc:chanrobles.com.ph
registration
statement
if
it
finds
that
disclosure
statements
therein
not
misleading;
or
method
in
the
registration
of
securities
is,
The
issuer
or
registrant
that the PSE acted correctly in refusing the listing of PALI in its
stock exchange. This does not discount the effectivity of
(ii) has violated or has not complied with the provisions of this
of
the
Commission;
failed
to
comply
with
In resum, the Court finds that the PSE has acted with
justified
before
the
security
can
be
registered;
circumspection,
discounting,
therefore,
any
stock
fraudulent
circumstances
transactions;
exchange
is
justified
by
the
attendant
law
and
by
to
the
this
case.chanroblesvirtuallawlibrary:red
(v) is in any way dishonest or is not of good repute; or
ACCORDINGLY, in view of the foregoing considerations, the
(vi) does not conduct its business in accordance with law or is
engaged
to
regulations.
Exchange Commission dated July 27, 1996 and April 24, 1996,
in
business
government
that
is
rules
illegal
and
or
contrary
private
respondent
Puerto
Azul
Land,
Inc.
or
principal
stockholder;
SO ORDERED.
or
Artificial Being
THIRD
DIVISION
or
investors."
(Emphasis
ours)
[G.R.
No.
142936.
NATIONAL
ELECTRIC
DECISION
NATIONAL
2002.]
PHILIPPINE
ENGINEERING
&
17,
&
BANK
April
SUGAR
COMPANY, Respondent.
PANGANIBAN, J.:
Carmen,
Floridablanca,
Pampanga;
that
the
plaintiff
is
distinct and separate from the persons and entities owning it.
(DBP) under LOI No. 311; that the defendant PNB organized
the mere fact that the Philippine National Bank (PNB) acquired
Bank of the Philippines (DBP), will not make PNB liable for the
PASUMILs
contractual
debts
to Respondent.chanrob1es
1aw
1ibrary
virtua1
plaintiff; that finally, on October 29, 1971, the plaintiff and the
Statement
of
the
Case
the
following,
to
wit
(a)
Construction
of
one
(1)
power
house
building;
follows:jgc:chanrobles.com.ph
"WHEREFORE,
the
judgment
appealed
from
is
hereby
AFFIRMED." 2
The Facts
(d) Complete overhauling and reconditioning tests sum for
three
(3)
350
KW
diesel
engine
generating
set[s];
of
Appeals
as
follows:jgc:chanrobles.com.ph
those
accessories;
stated
units
are
completely
supplied
with
their
government
and
complaint;
whereas,
corporation
the
other
duly
organized,
defendant,
the
existing
National
Sugar
as:chanrob1es
virtual
1aw
library
(a)
Supply
of
electrical
devices;
(1) Sentencing the defendants to pay the plaintiffs the sum of
(b)
Extra
mechanical
works;
(c)
Extra
fabrication
falls
due
and
demandable;
works;
(2) Condemning the defendants to pay attorneys fees
(d)
Supply
items;
amounting
repair;
(e)
of
materials
and
Electrical
consumable
shop
to
25%
of
the
amount
claim;
Supply
of
electrical
equipment
for
machinery;
including
fabrication
of
parts.
citing Article 1311 of the New Civil Code, and the case law
that out of the total obligation of P777,263.80, the defendant
1214.
within
15
days.
1aw
library
sued upon by the plaintiff under the present complaint; (b) the
involved in the present case; and, (d) all that was mentioned
defendants
PNB,
severally
to
NASUDECO,
and
wit:chanrob1es
PASUMIL,
virtual
jointly
1aw
and
library
present suit was brought; and [9] that, at most, what was
well
LOI
as
exemplary
damages.
No.
311.
assets of the defendant PASUMIL under LOI No. 189-A; (3) that
amount that the court may seem just and equitable in the
premises.
in time for the 1974-75 milling season, and that nothing in the
let alone that for which the present action is brought; (4) that
August
7,
1981
Order
issued
by
the
Trial
Court.
PNBs management and operation under LOI No. 311 did not
refer to any asset of PASUMIL which the PNB had to acquire
(NASUDECO)
ordering the latter to pay jointly and severally the former the
following:chanrob1es
and
PAMPANGA
SUGAR
virtual
MILLS
(PASUMIL),
1aw
library
fully
consideration,
in
favor
of
NASUDECO,
distinct
paid;
and
2.
The
sum
of
P102,724.76
as
attorneys
fees;
and,
3.
Costs.
SO
ORDERED.
Manila,
Philippines,
September
4,
1986.
(SGD)
ERNESTO
S.
TENGCO
Judge " 3
Decision.
liability
arising
therefrom.
10
4
Petitioners posit that they should not be held liable for the
Issues
"I
for
those
debts.
11
"II
Piercing
the
Veil
Corporate
Not
Warranted
Pacific
Farms,
15
SCRA
415."
to Respondent.
Petition
is
meritorious.
Main
Issue:chanrob1es
virtual
1aw
library
Liability
for
Corporate
Debts
committed
against
third
persons.
16
result
from
an
erroneous
application.
21
entered
into
to Respondent.
in
order
to
escape
liability
for its
debt
38
not only a right, but also a duty under the law to foreclose the
subject
properties.
41
or
unjust
loss
complained
of.
30
PNB, DBP and their transferees were not liable for Marinduque
when
petitioners
acquired
the
assets
of PASUMIL.
33
corporate
Being the party that asked for the piercing of the corporate
veil.
fact evidencing bad faith on the part of PNB and its transferee.
51 The corporate fiction was not used to defeat public
No
Merger
insistence
to
the
contrary.
63
or
WHEREFORE, the Petition is hereby GRANTED and the assailed
Consolidation
Decision
SET
ASIDE.
costs.chanrob1es
No
pronouncement
virtua1
1aw
as
to
1ibrary
SO ORDERED.
FIRST
[G.R.
No.
48930.
February
DIVISION
No.
48931.
23,
v.
February
1944.
FRANCISCO
23,
FRANCISCO
DE
BORJA, Petitioner,
VAZQUEZ, Respondent.
1944.
v.
]
DE
]
ANTONIO
SYLLABUS
1.
CORPORATIONS;
OFFICERS
PERSONAL
LIABILITY
ON
there must be an
express
provision
of law
contract
either
principally
or
subsidiarily.
DECISION
OZAETA, J.:
failed
to
distinguish
contractual
from
an
Code
are
those
incidental
to
the
fulfillment
or
the
defendants
jointly
and
severally
obligated
has
erroneously
held.
Sabani
Development
Co.,
Inc.,
individual
and
personal
capacity.
plus the sum of P377.50, with legal interest on both sums, and
Manager
Appeals set aside its judgment and ordered that the case be
posterior
and the case was ordered remanded to the court of origin for
Natividad-Vazquez
de
la
corporacion
Natividad-Vazquez
presidente de la corporacion
Sabani
Sabani
sucesora en
Development
Co.,
el
Inc.
Appeals.
"Siendo esto asi, la principal responsable debe ser la
The original decision of the Court of Appeals and its
subsequent
resolutions
on
reconsideration
read
as
follows:jgc:chanrobles.com.ph
cantidad
existia
en
las
bodegas
de
la
corporacion.
solamente
recibio
2,583
cavanes;
que
1902
demanda.
del
Codigo
Civil,
el
debe
ser
responsable
demandado
al
Fernando
Busuego
de
la
demanda
point is, in any event, beside the issue, and this we shall now
la demanda y las
costas
de ambas instancias."cralaw
virtua1aw
library
maintain.
evidence the trial court and the Court of Appeals found that
pruebas
decision
library
al
efecto
dicte
correspondiente."cralaw
despues
la
virtua1aw
thru Vazquez, had received the sum of P8,400 from Borja, and
"Upon consideration of the motion of the attorney for the
altho that was true from the point of view of a legal fiction,
22, 1942, be
the
by
defendant-appellant
denied."cralaw
Antonio
Vazquez,
virtua1aw
motion
him
in
its
behalf.
library
It is well known that a corporation is an artificial being
tried is whether the plaintiff entered into the contract with the
officers who manage and run its affairs. The mere fact that its
has to act thru its agents, does not make the latter personally
Inc." That finding of fact is final and, it resolving the only issue
involved,
should
be
determinative
of
the
result.
case. It has not been alleged nor even intimated that Vazquez
should have been proven during the trial; and the statement
the way, neither party had solicited but against which, on the
subsidiarily.
that
sino
to
he
"no
distinguish
solamente
obro
extracontractual
obligation
and
estimation not wholly right. Altho from the legal point of view
even
from
from
negligencia,
contractual
con
culpa
an
aquiliana.
The
fault
entitled
to
costs.
costs.
Separate Opinions
merely
subsidiary,
as
the
Court
of
Appeals
has
PARAS, J.,
dissenting:chanrob1es
virtual
1aw
library
jurisdiction over the issue and could not adjudicate upon it.
try
and
decide
such
issue.
entertain
the
the
his
counterclaim
for
damages
against
Court
of
Appeals,
from
his
fault
or
negligence.
1989,
in
the
total
amount
of
P176,467.50.
amount
of
of
P265,894.33.
On
30
October
P31,603.00.
1989,
the
inured
1aw
to
the
benefit
of
Natividad-Vazquez
Sabani
1ibrary
capital.
FIRST
[G.R.
DIVISION
No.
119002.
October
19,
2000.]
PHILIPPINES
FEDERATION,Respondents.
DECISION
FOOTBALL
impleaded
the
Federation
as
an
alternative
defendant.
KAPUNAN, J.:
With
1aw
the
costs
against
defendant
Henri
Kahn.
10
library
WHEREFORE, premises considered, the judgment appealed
Kahn.
11
personality
from
its
officers.
he did not.
stated
that:chanrob1es
virtua1
1aw
1ibrary
voluntary
unincorporated
association,
like
defendant
Federation, and the plaintiff did not appeal from this decision.
Hence, the Philippine Football Federation is not a party to this
The
dispositive
reads:chanrob1es
portion
of
the
virtual
trial
courts
1aw
decision
clause, let alone the fact that the judgment dismissing the
library
therefore
similarly
DENIED.
12
5, 1990, the date the complaint was filed, until the principal
13
for
attorneys
fees.chanrob1es
virtua1
1aw
1ibrary
A. THE, HONORABLE COURT OF APPEALS ERRED IN HOLDING
are
hereby
dismissed.
PERSONALITY.
with
this
Act.
OBLIGATION.
Section 8 of P.D. 604, grants similar functions to these sports
C. ASSUMING ARGUENDO THAT PRIVATE RESPONDENT KAHN
associations:chanrob1es
virtual
1aw
library
DECISION
THE
1ibrary
THAT
THE
PFF
IS
OBLIGATION.chanrob1es
SOLELY
virtua1
LIABLE
1aw
FOR
1aw
library
and Presidential Decree No. 604 as the laws from which said
1ibrary
entity
are
Filipino
citizens.
3135
library
other than the Olympic and Asian Games, for the promotion of
their
organization
provides:chanrob1es
and
virtual
1aw
government.
purposes.
sport;
and organized within six months from and after the passage
of
this
Act.chanrob1es
virtua1
1aw
1ibrary
passage
1aw
of these
laws.chanrob1es
virtua1
1aw
1ibrary
library
agree with the view of the appellate court; and the private
proposed
association.
manner
will
by
which
these
entities
may
acquire
juridical
promote
the
objectives
of
this
Decree
and
has
virtual
1aw
library
such
rules
and
regulations
formulated
by
it.
The
Department
particular
sport
shall
for
supervise
which
the
they
national
are
sports
organized.
and
filing
fee
of
ten
pesos.
such
entity
must
be
recognized
by
the
accrediting
Development
under
P.D.
604.
reconsideration
specify the reasons for the rejection shall not affect the
Philippine
virtua1
before
Football
the
trial
Federation
1aw
is
court
not
copy
national
of
the
sports
1ibrary
MANGOBA, Respondents.
benefited
on
the
irrelevant
ground
of
defective
from
the
contract.
DECISION
SERENO, C.J.:
Security
of
tenure
is
constitutionally
guaranteed
corporations
employees en
masse.
Resolution7 in
CA-G.R.
SP
No.
97942.
SO ORDERED.
(De
Right of Succession
Guzman).
EN BANC
Abelardo
(Samson).8cralawlibrary
Samson
Gomez
ESPIRITU,
stock:chanroblesvirtualawlibrary
SIMEON
ESPIRITU,
JR.,
AND
LIBERATO
IV,
Samson
then
sent
formal
letters
(Letter
MANGOBA, Respondents.
4.
G.R.
No.
186641,
October
08,
2013
AND
AURELIO
VILLAFLOR,
xxxx
7.
All
retirement
benefits,
of
before
the
National
Labor
Relations
hereby
illegal
directors
the
Complaint
of
any
above
officers/stockholders/board
if
are
dismissal;
Agustin
Agustin and De Guzman accepted the terms and conditions
and
illegal
De
deductions;
Guzman
as
underpayment;
respondents
to
and
the
29
case. cralawlibrary
Letter
Bank, held a meeting with all the employees of the head office
also
12
Samson. cralawlibrary
found
respondent
employees
were
illegally
Relying
that
against
the
Samson
Group,
as
this
representation,
Jr.,16 and
Liberato
on
17
follows:chanroblesvirtualawlibrary
the
retirement
letter
dated
September
2001.19cralawlibrary
Jr.,23 and
representative
on
11
September
25
2001. cralawlibrary
total
amount
of P339,403.00 detailed
as
follows:chanroblesvirtualawlibrary
Elicerio
P5,837.0
B.
=
0
Gaspar
Ricardo
B.
P11,674.
=
Gaspar,
00
Jr.
Liberato
P64,207.
B.
=
00
Mangoba
Fidel
E. P29,185.
=
Espiritu
00
Simeon
B.
P26,000.
=
Espiritu, 00
Jr.
Eufemia
P202,510
=
E. Rosete .00
All other claims including the complaint against Abelardo
Samson, Olga Samson and Aurelio Villaflor are hereby
DISMISSED
for
want
of
merit.
2001. cralawlibrary
SO ORDERED.30
Dissatisfied with the Decision of the labor arbiter, respondent
employees, Agustin and De Guzman brought separate appeals
Respondent-employees
demanded
Guzman contended that they should not be held liable for the
payment
of
the
employees
claims.
hereby AFFIRMED.
SO ORDERED.34
200835 and
19
2009.36cralawlibrary
February
backwages, as follows:chanroblesvirtualawlibrary
THE ISSUES
and
five
(5%)
percent
attorneys
fees.
if so, which of the parties are liable for the claims of the
Other
dispositions
are AFFIRMED
SO ORDERED.
31
Agustin
and
De
Guzman
filed
Rule
65
Petition
court.
in
view
of
the
foregoing,
the
petition
III-07-4542-02)
are
hereby AFFIRMED.
SO ORDERED.33
Subsequently, CA-G.R. SP No. 97942 was disposed of by the
appellate court in a Decision dated 15 January 2008, which
likewise affirmed that of the NLRC. The dispositive portion of
the CA Decision states:chanroblesvirtualawlibrary
Rosete
and
Liberato
Mangoba
voluntary,
they
were
not
dismissed
from
their
in
terms
of
gratitude.
must
be
made
voluntarily
relinquishing
the
relinquishment.
41
office,
and
with
coupled
the
with
intention
of
an
of
act
2001.48cralawlibrary
involuntary
circumstances
in
each
particular
case.
retirement
is
tantamount
to
dismissal,
as
42
As it turned out,
except for Simeon, Jr., they were not rehired by the new
employment.
their
work;
rather,
they
were
terminated
from
their
employment.
the
Again,
Code.51cralawlibrary
Labor
we
disagree.
indicating
that
she
was
retiring
from
her
former
43
position. cralawlibrary
date
closure.53 Moreover,
of
the
dismissed
The fact that Eufemia retired and did not resign, however,
was
place.
due
reverses.
54
to
serious
However,
to
business
be
exempt
losses
from
or
financial
making
such
reverses.55cralawlibrary
be
treated
as
discharge.44cralawlibrary
In this case, the facts show that Eufemias retirement was not
telling. The facts show that Eufemia was likewise given the
oversee
45
2001.
operations.
bank
cause.
In the case at bar, the Letter Agreements show that their main
reverses.
authorized
cause
holds
no
water.
dismissed.57cralawlibrary
employees,
56
employees
to
were
validly
argues
that
the
dismissal
was
lawful.
in
the
new
majority
shareholders
of
We
are
not
persuaded.
the
corporation.
60
of
stock62 to
new
or
61
sell a controlling
existing
shareholders.
conformity70 by
the
new
majority
shareholders.
The
basis.
After
about
six
months,
the
new
abandoned
their
work,
and
it
dismissed
the
rest
for
management.71cralawlibrary
64
management.72cralawlibrary
firm.65cralawlibrary
In disposing of the merits of the case, we upheld the validity
In contrast with asset sales, in which the assets of the selling
provided
for
73
in
Citing
their
our
probationary
contract
pronouncements
of
employment].
in Central
follows:chanroblesvirtualawlibrary
payment
of
their
claims.
justice.
employees.
employees,
Neither
absent
should
it
just
give
or
the
new
majority
authorized
cause.
the employees.chanrob1esvirtualawlibrary
most that the transferee may do, for reasons of public policy
of
purchaser.
We
the
take
this
opportunity
to
revisit
our
ruling
stock sale case. Central Azucarera del Danao, San Felipe Neri
challenging
the
legality
of
their
separation
from
the
service.77cralawlibrary
dismissal as follows:chanroblesvirtualawlibrary
employee
cause.
due
to
the
harsh,
hostile,
and
unfavorable
to
Simeon
Espiritu,
Jr.
thus
discuss
his
circumstance
separately.
79
to
80
and
rehired
by
the
new
personal
employment
was
reasons,
on
15
he
again
October
resigned
from
his
II
SME Bank, Eduardo M. Agustin, Jr. and Peregrin de
Guzman, Jr. are liable for illegal dismissal.
2001.81cralawlibrary
Having ruled on the illegality of the dismissal, we now discuss
the issue of liability and determine who among the parties are
82
Group.
None of the parties dispute that SME Bank was the employer
his
employment.
Rather,
letter
effective
15
October
85
83
2001. cralawlibrary
its
corporate
liabilities.
Clearly,
claims.
this
sequence
of
events
constituted
gross
held solidarily liable with SME Bank for the satisfaction of the
employees
lawful
claims.
the
respondent
Guzman and the Samson Group may not be held liable for
Samson
directors
as
members. However,
be pierced
and
employees
officers
in
on
the
illegal
other.
dismissal
Rather,
cases,
were
not
in
legal
control
of
the
bank
and
follows:chanroblesvirtualawlibrary
this
91
(Citations omitted)
charge
faith.
thereof.
As
the
spouses
Samson
were
neither
solidarily
may
liable with
have
SME
attached
Bank
under
for
other
illegally
dismissing
provisions
of
law.
of
the
corporation
at
the
time
that
Simeon,
Jr.
was
constructive
dismissal.
WHEREFORE, premises considered, the instant Petitions for
Finally,
as
regards
Aurelio
Villaflor,
while
he
may
be
Review
are PARTIALLY
GRANTED.
actual
participation
in
the
termination
of
respondent
September
claims.
2008,
respectively,
Jr. solidarily
ASIDEinsofar
liable
for
are
as
illegal
it
dismissal.
III
Respondent employees are entitled to separation pay,
as
it
held Abelardo
P.
Samson,
Olga
dismissal.
reinstatement
is
no
longer
viable;
and
(2)
backwages.96cralawlibrary
even
absent
just
or
authorized
cause.
SO ORDERED.
as
an
alternative
to
reinstatement.
SECOND
[G.R.
DIVISION
No.
WENSHA
185122
SPA
PETITIONERS,
CENTER,
VS.
August
INC.
LORETA
T.
16,
AND/OR
YUNG,
XU
2010]
ZHI
JIE,
RESPONDENT.
DECISION
MENDOZA, J.:
the
National
Labor
Relations
Hence, respondent
master. In this action, the petitioners assail the May 28, 2008
addition
to
100
separation
pay.
Inc.
and/or
Xu
Zhi
Jie.
done
and
attended
by
bad
faith.
THE
FACTS:
reads:
her
termination
from
employment.
stable and she had been with Manmen for seven years. But
Enticed,
complainant
confidence.
was
dismissed
due
to
loss
of
trust
and
Manager.5
Wensha and filed her complaint. The NLRC added that this
on leave with pay for one month. She did so and returned on
September 10, 2004. Upon her return, Xu and his wife asked
case.
Shui master, her aura did not match that of Xu. Loreta refused
but was informed that she could no longer continue working
Wensha
and
Xu
denied
illegally
terminating
Loreta's
The
following:
2004
for
loss
of
trust
and
confidence. 6
CA
noted
that
there
were
irregularities
and
Center, Inc. and Xu Zhi Jie are ORDERED to, jointly and
privileges,
on the sales report and order slips, which allegedly prove that
exemplary
Yung had been charging her food and drinks to Wensha, the
(Php20,000.00)
and
benefits,
damages,
as
or
their
and
monetary
twenty
attorney's
equivalent,
thousand
fees.
No
pesos
costs.
SO ORDERED.11
Hence, it would
have been duly executed under oath, she did not, however,
specify the alleged infractions that Yung committed. If at all,
5.1 The following are the reasons and arguments, which are
(DTRs)
of
Yung,
which
supposedly
prove
her
habitual
Resolution,
to
wit:
evidence.
[Emphases
appear
in
the
original]
x.
respect
and
finality;
5.1.2
their rejoinder.
despite the fact that the records clearly show that petitioner
25, 2004, much later than its date of filing. The irregularities
Nevertheless, the
termination;
5.1.3
as
5.1.4
well
as
damages
and
attorney's
fees;
leave of absence with pay for one month starting August 10,
2004.16
assuming
that
respondent
was
illegally
dismissed;
Wensha also alleged that Loreta was "sowing intrigues in the
5.2
tardiness,
and
abuse
authority. 17
of
precedent.12
In its Rejoinder, Wensha changed its position claiming that it
THE
COURT'S
RULING:
complaint.18
questionable.
clearly
security
of
facts.19
established
tenure.
The Court finds the LA ruling that states, "[a]bsent any proof
or for any of the authorized causes under Articles 283 and 284
valid
or
evidence.
authorized
cause
supported
by
substantial
22
illegal. 14
the
dismissal
unjustified
and,
therefore,
Reyes (Delos Reyes) which was dated March 21, 2005, not in
As a rule, the factual findings of the court below are
with
LA.
those
of
the
NLRC
and
the
Because of the
month
while
Wensha
conducted
an
investigation.
reason
therefor.
stood her ground, Jian Xue Qin shouted invectives at her and
On August 10, 2004 however, complainant was called by
told
to
leave
the
office
immediately.
respondents;
the
office and went straight to this Office and filed the present
that
complainant
should
not
enter
She
ADMINISTRATIVE
CENTER IS
NO
STARTING
OFFICER
OF
LONGER CONNECTED
TO
TODAY SEPTEMBER
WENSHA
THIS
SPA
COMPANY
10,
2004.
OF
THE
COMPANY.
immediately
contacted
respondent
Xu.
The
Court
finds
Loreta's
complaint
credible.
There
is
In contrast,
confidence.
nowhere. Instead, it was Jiang Xue Qin a.k.a Annie Co, the
conversation
they
between
them,
the
former
frankly
told
must
To
be
be
valid
founded
on
cause
clearly
for
termination
established
of
facts.
and therefore she does not fit to work (sic) with the
Loreta was duly informed of the charges against her and that
one (1) month salary for every year of service.33 The CA,
portion.
side.
Wensha
should
also
have
kept
records
of
This
should
be
rectified.
the
liable
with
Wensha.
consideration
being
This is a requirement of
due process and clearly, Loreta did not receive any of those
required
for
of
all
the
circumstances,
30
she
is
notices.
disregarding
the
separate
corporate
personality." 34
parties.
illegally
reinstatement,
fraud.36
Under
the
law
which
and
are
jurisprudence,
separate
and
an
distinct.
If
their
to
have read the decision in its entirety but simply failed to come
relationship
has
been
31
unduly
strained
due
To
employer
read as follows:
from
the
grossly
unpalatable
obligation
of
The
SO ORDERED.
where
it
refused
to
address,
on
jurisdictional
FIRST DIVISION
APPEALS,Respondents.
B.
ASCALON,
MONFORT
ILDEFONSO
III,
B.
MA.
LUISA
MONFORT,
MONFORT
ALFREDO
B.
MONFORT
HERMANOS
AGRICULTURAL
ANTONIA
M.
SALVATIERRA,
and
RAMON
H.
MONFORT, Respondents.
DECISION
Development
Corporation
(Corporation)
and
Ramon
H.
Salvatierra and/or
Ramon
who passed the same were not validly elected officers of the
Corporation.
for certiorari with the Court of Appeals but the same was
The group of Antonio Monfort III claims that the March 31,
10
through its
board
12
days
after
the
election
the
names,
nationalities
and
lbrr
xxx
Special Tenth Division set aside the judgment of the RTC and
of
Ma.
Antonia
Corporation.
15
M.
Salvatierra
to
represent
the
fact to the Commission with fifteen (15) days after such death,
the Board who authorized the filing of the complaint were the
The only issue in this case is whether or not the filing of the
together
Oscar Gan, Lionel Pengson, Jose Ma. Silva, Aderito Yujuico and
with
their
corresponding
position
In the instant case, the six signatories to the March 31, 1997
show that Premium did not authorize the filing in its behalf of
any
Corporate Bank.
suit
against
the
private
respondent
International
the
the
follows:rbl
SEC.Under
composition
of
said
the
General
Board
is
Information
as
Sheet
r l l lbrr
1.Ma.
Antonia
M.
directors
of
the
Premium
Marble
Resources,
Inc.
were:rbl r l l lbrr
3.Antonio H. Monfort, Jr., (Member);chanroblesvirtuallawlibrary
Alberto C. Nograles President/Director
4.Joaquin H. Monfort (Member);chanroblesvirtuallawlibrary
Fernando D. Hilario Vice President/Director
5.Francisco H. Monfort (Member) and
Augusto I. Galace Treasurer
6.Jesus Antonio H. Monfort (Member).
20
rll
Jose L.R. Reyes Secretary/Director
states that the newly elected officers for the year 1982 were
In the case at bar, the fact that four of the six Members of the
the
sound
judgment
of
the
Securities
&
Exchange
Commission.
Sheet was attributable to its oversight and not the fault of the
Corporation.25 This belated attempt, however, did not erase
Sec.
26
of
the
Corporation
Code
provides,
thus:rbl r l l lbrr
Board Resolution was held on October 16, 1996, but the SEC
andExchangeCommission,the
names,
nationalities
and
who signed the March 31, 1997 Board Resolution was the
III as early as 1997, but the Minutes of said October 16, 1996
meeting
was
presented
by
the
Corporation
only
in
EN
BANC
[G.R.
No.
L-19550.
June
19,
1967.]
The Court notes that the complaint in Civil Case No. 506-C, for
detention
the of
387
fighting
cocks
of Ramon
H.
Bureau
of
Investigation;
SPECIAL
Court
of
Quezon
City, Respondents.
and
Juan
David,
for Petitioners.
Pacifico
P.
de
Castro,
Assistant
Solicitor
SYLLABUS
SO ORDERED.
virtua1aw
library
4. ID.; ID.; ID.; ID.; CASE AT BAR. The grave violation of the
manner set forth in said provision; and (2) that the warrant
accounts,
business
objective:
Financial
transactions
the
records,
vouchers,
including
elimination
disbursement
of
general
journals,
receipts,
warrants.
is contrary, not only to the letter, but also to the spirit of the
of
said
laws
or
coders.
there is probable cause and only possible for the Judge to find
establish
probable
cause.
ILLEGAL
the Revised Rules of Court (Sec. 3, Rule 126) that "a search
suffice
SEARCH
to
protect
WARRANT
the
OR
MAKE
constitutional
UNREASONABLE
guarantee
under
virtua1aw
library
sight of the fact that the psychological and moral effect of the
had
been
committed.
money seized were not delivered to the courts that issued the
March 20, 1962, said petitioners filed with the Supreme Court
29, 1962, are null and void; the searches and seizures therein
Respondent-Prosecutors,
representatives
DECISION
from
using
the
their
agents
effects
and
seized
or
as
CONCEPCION, C.J.:
"Books
to
of
accounts,
wit:jgc:chanrobles.com.ph
financial
records,
vouchers,
(cigarette
wrappers)."cralaw
virtua1aw
library
(Code)
and
the
Revised
Penal
Code."cralaw
searches
and
seizures.
herein.
(2) major groups, namely: (a) those found and seized in the
found
seized
in
the
residences
of
petitioners
herein.
made under the authority thereof, are valid or not; and (2) if
evidence
against
petitioners
herein.
the seizures effected upon the authority thereof are null and
void.
things
provides:jgc:chanrobles.com.ph
seized
from
the
offices
and
premises
of
the
In
this
connection,
the
Constitution
13
been
held:jgc:chanrobles.com.ph
seized."cralaw
affect
the
personal
defendants.
If
these
papers
virtua1aw
library
were
Two
any one were invaded, they were the rights of the corporation
points
must
be
stressed
in
connection
with
this
in the manner set forth in said provision; and (2) that the
of the Fourth
search
personal
was taken . . ." (A. Guckenheimer & Bros. Co. v. United States,
[1925]
and
themselves
seizure
F.
2d,
does
the benefits
not
786,
extend
to
the
789, Emphasis
supplied.)
the
petitioners
and
major
objective:
the
the
aforementioned
elimination
of
corporations,
general
warrants.
Relying upon
determinate
provision
of
said
laws
or
codes.
evidence
Said position was in line with the American common law rule,
that
wrest
it,
even
though
by
legal
means.
against
the
petitioners
constitutional
herein.
prohibition
Upon
against
mature
unreasonable
as
may
be
provided
by
other
laws.
library
and
seizures.
In
the
language
of
Judge
Learned
Hand:jgc:chanrobles.com.ph
The grave violation of the Constitution made in the application
for the contested search warrants was compounded by the
seized,
to
wit:jgc:chanrobles.com.ph
business
transactions
including
disbursement
receipts,
repressed."
18
library
In fact, over thirty (30) years before, the Federal Supreme
Court
had
already
declared:jgc:chanrobles.com.ph
"If letters and private documents can thus be seized and held
law
of
the
land."
19
consistently
tolerate
denial
of
its
most
important
v.
Ohio
(supra.):jgc:chanrobles.com.ph
the
Court
itself
recognized
that
the
purpose
of
the
state intrusion, and, after its dozen years on our books, are
by
removing
the
incentive
to
disregard
it.
inadmissible
in
State
court.
administration
of
justice."
(Emphasis
ours.)
petitioners
herein.
Upon the other hand, we are not satisfied that the allegations
to
establish
probable
cause.
who
make
appropriate
secure
an
illegal
search
warrant
and/or
cases
in
the
future.
agents of the majority, one must not lose sight of the fact that
specified in the Resolution of June 29, 1962 are null and void;
power of the party for whose benefit the illegality had been
that the searches and seizures therein made are illegal; that
committed.
aforementioned
residences
are
concerned;
that
the
It
is
so
ordered.
courts
of
the
United
States.
22
Separate Opinions
library
conclusions:chanrob1es
virtual
1aw
library
illegal;
and remain void, and the searches and seizures were illegal
and remain illegal. No inference can be drawn from the words
80
Phil.
1,
should
be,
and
is
declared,
abandoned;
the
lawfulness
or
illegality
of
search
or
seizure.
residences
and
Circuit
open
is
for
made
determination
future."cralaw
in
permanent;
appropriate
cases
virtua1aw
in
Courts
of
Appeals.
the
library
summarized
(numbered
in
5)
the
immediately
with
which
preceding
am
not
paragraph
in
accord.
where the search warrant and the sworn application for search
library
prejudices
inordinately
generated
by
the
environmental
this Court from forthrightly laying down the law - not only for
this case but as well for future cases and future generations.
therefore
the
admittedly
and
indisputably
outlawed
by
said
three
warrants
were
also
the
same
the
Countless other cases which have come to this Court over the
under
the
control
of
the
petitioners.
surreptitious
electronic
surveillance
in
Silverman.
of
matters
seized
gives
"standing."cralaw
virtua1aw
Ownership
library
of
the
properties
seized
alone
entitles
the
Control
13,
of
1951).
premises
(Emphasis
searches
gives
supplied).
"standing."cralaw
virtua1aw
library
2d
the
the
492, 493
(9th
Cir.
1925) (books
seized
from
defendant).
which the papers were stored (Room 204, Army & Navy Club);
In a very recent case (decided by the U.S. Supreme Court on
premises
his
papers
automobile:jgc:chanrobles.com.ph
searched
therefore
and
independently
effects
seized
gives
them
therefrom.
fundamental
Amendment
nature
and
scope
of
Fourth
decisions,
266):jgc:chanrobles.com.ph
the
Supreme
Court
said
(362
U.S.
lower
courts.
We
are
persuaded,
however,
that
it
is
which, more than almost any other branch of law, has been
the
search
occurs."cralaw
virtua1aw
library
Shortly after the U.S. Supreme Courts Jones decision, the U.S.
Court of Appeals for the Fifth Circuit held that the defendant
United States, 296 F. 2d. 650, 652 (5th Cir. 1961), supra. The
(1961).
records.
observed:jgc:chanrobles.com.ph
Looking
to
Jones,
the
court
2d
at
651.
obtained
should
be
granted."
(Emphasis
supplied)
necessary
the
privacy. Both Henzel and Villano considered also the fact that
standing
to
invoke
the
protection
of
United
States,
310
F.
2d
at
683.
v. United States, 362 U.S. 257, 267, the U.S. Supreme Court
before
Jones."
(p.
199)
holding
that.
"Schwimmer
legally
had
such
possession,
control
and
498 (1950), affirmed 342 U.S. 48, 72 S. Ct. 93, 96 L. Ed. 459
(1951).
1956).
virtua1aw
library
closer
than
in
Birrell.
together
certain
personal
with
corporate
books
and
records
of
control.
move for the return of all the papers and properties seized.
things seized from the corporate offices and other places were
petitioners.
the law was Birrell. The first "search warrant described the
records as having been used in committing a violation of Title
18, United States Code, Section 1341, by the use of the mails
198)
mentioned
in
the
void
search
warrants.
EN
[G.R.
BANC
No.
L-32409.
February
27,
1971.]
Gonzales
&
San
Agustin,
DECISION
VILLAMOR, J.:
be granted
virtual
for the
1aw
following
library
And
thereafter?
"A
"Q
Who
The
is
this
Honorable
he?
Judge.
"Q
"A
The
The
deposition
affidavit,
Your
or
Honor."cralaw
the
affidavit?
virtua1aw
library
J.B.L., J.,
Dizon,
and
Makalintal, Zaldivar,
Makasiar, JJ.,
concurs
with
Mr.
Fernando,
concur.
Justice
Barredo.
Separate Opinions
BARREDO, J.,
I
concurring:chanrob1es
virtual
1aw
library
concur.
EN BANC
G.R. No. 75885 May 27, 1987
BATAAN
SHIPYARD
&
ENGINEERING
CO.,
INC.
(BASECO), petitioner,
vs.
PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT,
CHAIRMAN JOVITO SALONGA, COMMISSIONER MARY
CONCEPCION BAUTISTA, COMMISSIONER RAMON DIAZ,
COMMISSIONER
RAUL
R.
DAZA,
COMMISSIONER
QUINTIN S. DOROMAL, CAPT. JORGE B. SIACUNCO, et
al., respondents.
Apostol, Bernas, Gumaru, Ona and Associates for petitioner.
Vicente G. Sison for intervenor A.T. Abesamis.
NARVASA, J.:
Challenged in this special civil action of certiorari and
prohibition by a private corporation known as the Bataan
Shipyard and Engineering Co., Inc. are: (1) Executive Orders
Numbered 1 and 2, promulgated by President Corazon C.
Aquino on February 28, 1986 and March 12, 1986,
respectively, and (2) the sequestration, takeover, and other
orders issued, and acts done, in accordance with said
executive orders by the Presidential Commission on Good
Government and/or its Commissioners and agents, affecting
said corporation.
1. The Sequestration, Takeover, and Other Orders Complained
of
a. The Basic Sequestration Order
The sequestration order which, in the view of the petitioner
corporation, initiated all its misery was issued on April 14,
1986 by Commissioner Mary Concepcion Bautista. It was
addressed to three of the agents of the Commission, hereafter
simply referred to as PCGG. It reads as follows:
Management
Management
7.
New
Management
Trident
8. Bay Transport
9.
And
all
affiliate
companies
of
Alfredo
"Bejo" Romualdez
You are hereby ordered:
1. To implement this sequestration order
with a minimum disruption of these
companies' business activities.
2. To ensure the continuity of these
companies as going concerns, the care and
maintenance of these assets until such time
that the Office of the President through the
Commission on Good Government should
decide otherwise.
3. To report to the Commission on Good
Government periodically.
Further, you are authorized to request for
Military/Security
Support
from
the
Military/Police authorities, and such other
acts essential to the achievement of this
sequestration order. 1
b. Order for Production of Documents
On the strength of the above sequestration order, Mr. Jose M.
Balde, acting for the PCGG, addressed a letter dated April 18,
1986 to the President and other officers of petitioner firm,
reiterating an earlier request for the production of certain
documents, to wit:
1. Stock Transfer Book
of
2.2. By-Laws
2.3. Minutes of the Annual
Stockholders Meeting from
1973 to 1986
2.4.
Minutes
of
the
Regular
and
Special
Meetings of the Board of
Directors from 1973 to
1986
Jai-Alai
2.1.
Articles
Incorporation
2.5.
Minutes
of
the
Executive
Committee
Meetings from 1973 to
1986
2.6. Existing contracts
with
suppliers/contractors/othe
rs.
3. Yearly list of stockholders with their
corresponding
share/stockholdings
from
1973 to 1986 duly certified by the Corporate
Secretary.
4. Audited Financial Statements such as
Balance Sheet, Profit & Loss and others from
1973 to December 31, 1985.
5. Monthly Financial Statements for the
current year up to March 31, 1986.
6. Consolidated Cash Position Reports from
January to April 15, 1986.
7. Inventory listings of assets up dated up to
March 31, 1986.
8. Updated schedule of Accounts Receivable
and Accounts Payable.
9. Complete list of depository banks for all
funds with the authorized signatories for
withdrawals thereof.
10. Schedule of company investments and
placements. 2
The letter closed with the warning that if the documents were
not submitted within five days, the officers would be cited for
"contempt in pursuance with Presidential Executive Order
Nos. 1 and 2."
c. Orders Re Engineer Island
(1) Termination
Contract
for
Services
of
Security
h. Termination of Services
of BASECO Officers
Thereafter, Capt. Siacunco, sent letters to Hilario M. Ruiz,
Manuel S. Mendoza, Moises M. Valdez, Gilberto Pasimanero,
and Benito R. Cuesta I, advising of the termination of their
services by the PCGG. 10
2. Petitioner's Plea and Postulates
It is the foregoing specific orders and acts of the PCGG and its
members and agents which, to repeat, petitioner BASECO
would have this Court nullify. More particularly, BASECO prays
that this Court1) declare unconstitutional
Numbered 1 and 2;
and
void
Executive
Orders
2) annul the sequestration order dated April- 14, 1986, and all
other orders subsequently issued and acts done on the basis
thereof, inclusive of the takeover order of July 14, 1986 and
the termination of the services of the BASECO executives. 11
a. Re Executive Orders No. 1 and 2, and the
Sequestration and Takeover Orders
20
g. Remedies, Non-Judicial
Parenthetically, that writs of sequestration or freeze or
takeover orders are not issued by a court is of no moment.
The Solicitor General draws attention to the writ of distraint
and levy which since 1936 the Commissioner of Internal
Revenue has been by law authorized to issue against property
of a delinquent taxpayer. 56 BASECO itself declares that it has
not manifested "a rigid insistence on sequestration as a purely
judicial remedy * * (as it feels) that the law should not be
ossified to a point that makes it insensitive to change." What
it insists on, what it pronounces to be its "unyielding position,
is that any change in procedure, or the institution of a new
one, should conform to due process and the other
prescriptions of the Bill of Rights of the Constitution." 57 It is,
to be sure, a proposition on which there can be no
disagreement.
h. Orders May Issue Ex Parte
Like the remedy of preliminary attachment and receivership,
as well as delivery of personal property in replevinsuits,
sequestration and provisional takeover writs may issue ex
parte. 58 And as in preliminary attachment, receivership, and
delivery of personality, no objection of any significance may
be raised to the ex parte issuance of an order of
sequestration, freezing or takeover, given its fundamental
character of temporariness or conditionality; and taking
account specially of the constitutionally expressed "mandate
of the people to recover ill-gotten properties amassed by the
leaders and supporters of the previous regime and protect the
interest of the people;" 59 as well as the obvious need to avoid
alerting suspected possessors of "ill-gotten wealth" and
thereby cause that disappearance or loss of property precisely
sought to be prevented, and the fact, just as self-evident, that
"any transfer, disposition, concealment or disappearance of
said assets and properties would frustrate, obstruct or hamper
the efforts of the Government" at the just recovery thereof. 60
8. Requisites for Validity
What is indispensable is that, again as in the case of
attachment and receivership, there exist a prima facie factual
foundation, at least, for the sequestration, freeze or takeover
order, and adequate and fair opportunity to contest it and
endeavor to cause its negation or nullification. 61
Both are assured under the executive orders in question and
the rules and regulations promulgated by the PCGG.
a. Prima Facie Evidence as Basis for Orders
1. Jose A. Rojas
1,248 shares
2. Severino G. de la
Cruz
1,248 shares
3. Emilio T. Yap
2,508 shares
4. Jose Fernandez
1,248 shares
5. Jose Francisco
128 shares
6.
Manuel
Mendoza
S.
96 shares
7. Anthony P. Lee
1,248 shares
8. Hilario M. Ruiz
32 shares
9.
Constante
Farias
L.
8 shares
10.
Fidelity
Management, Inc.
65,882 shares
11.
Trident
Management
7,412 shares
1,240 shares
13.
8 shares
Renato
M.
Tanseco
15.
Metro
Drydock
8 shares
Bay
136,370
shares
1 share
17. Jonathan G. Lu
1 share
1 share
128 shares
20.
Edward
Marcelo
T.
TOTAL
4 shares
218,819
shares.
10. BASECO-REPACOM
May 27, 1975;
Agreement
dated
92
shares of BASECO
blank; 98 and
stock,
assigned
in
4)
stock
certificates
corresponding
to 207,725 out of the 218,819 outstanding
shares of BASECO stock; that is, all but 5 %
all endorsed in blank. 99
While the petitioner's counsel was quick to dispute this
asserted fact, assuring this Court that the BASECO
stockholders were still in possession of their respective stock
certificates and had "never endorsed * * them in blank or to
anyone else," 100 that denial is exposed by his own prior and
subsequent recorded statements as a mere gesture of
defiance rather than a verifiable factual declaration.
By resolution dated September 25, 1986, this Court granted
BASECO's counsel a period of 10 days "to SUBMIT,as
undertaken by him, * * the certificates of stock issued to the
stockholders of * * BASECO as of April 23, 1986, as listed in
Annex 'P' of the petition.' 101 Counsel thereafter moved for
extension; and in his motion dated October 2, 1986, he
declared inter alia that "said certificates of stock are in the
possession of third parties, among whom being the
respondents themselves * * and petitioner is still endeavoring
to secure copies thereof from them." 102 On the same day he
filed another motion praying that he be allowed "to secure
copies of the Certificates of Stock in the name of Metro Bay
Drydock, Inc., and of all other Certificates, of Stock of
petitioner's stockholders in possession of respondents." 103
In a Manifestation dated October 10, 1986,, 104 the Solicitor
General not unreasonably argued that counsel's aforestated
motion to secure copies of the stock certificates "confirms the
fact that stockholders of petitioner corporation are not in
possession of * * (their) certificates of stock," and the reason,
according to him, was "that 95% of said shares * * have been
endorsed in blank and found in Malacaang after the former
President and his family fled the country." To this
manifestation BASECO's counsel replied on November 5,
1986, as already mentioned, Stubbornly insisting that the
firm's stockholders had not really assigned their stock. 105
In view of the parties' conflicting declarations, this Court
resolved on November 27, 1986 among other things "to
require * * the petitioner * * to deposit upon proper receipt
with Clerk of Court Juanito Ranjo the originals of the stock
certificates alleged to be in its possession or accessible to it,
mentioned and described in Annex 'P' of its petition, (and
other pleadings) * * within ten (10) days from notice." 106 In
a motion filed on December 5, 1986, 107 BASECO's counsel
made the statement, quite surprising in the premises, that "it
will negotiate with the owners (of the BASECO stock in
question) to allow petitioner to borrow from them, if available,
the certificates referred to" but that "it needs a more sufficient
time therefor" (sic). BASECO's counsel however eventually
had to confess inability to produce the originals of the stock
certificates, putting up the feeble excuse that while he had
"requested the stockholders to allow * * (him) to borrow said
certificates, * * some of * * (them) claimed that they had
delivered the certificates to third parties by way of pledge
and/or to secure performance of obligations, while others
allegedly have entrusted them to third parties in view of last
national emergency." 108 He has conveniently omitted, nor
has he offered to give the details of the transactions adverted
to by him, or to explain why he had not impressed on the
supposed stockholders the primordial importance of
convincing this Court of their present custody of the originals
of the stock, or if he had done so, why the stockholders are
unwilling to agree to some sort of arrangement so that the
originals of their certificates might at the very least be
exhibited to the Court. Under the circumstances, the Court
can only conclude that he could not get the originals from the
stockholders for the simple reason that, as the Solicitor
is
also
cited
by
the
Solicitor
Not
Exercise
Acts
of
Separate Opinions
make ineffectual its efforts to carry out its task; punish for
direct or indirect contempt in accordance with the Rules of
Court; and seek and secure the assistance of any office,
agency or instrumentality of the government. In the case of
sequestered businesses generally (i.e. going concerns,
business in current operation), as in the case of sequestered
objects, its essential role, as already discussed, is that of
conservator, caretaker, 'watchdog' or overseer. It is not that of
manager, or innovator, much less an owner." 5
Now, the case at bar involves one where the third and most
encompassing
and
rarely
invoked
of
provisional
remedies, 6 the provisional takeover of the Baseco properties
and business operations has been availed of by the PCGG,
simply because the evidence on hand, not only prima
facie but convincingly with substantial and documentary
evidence of record establishes that the corporation known as
petitioner BASECO "was owned or controlled by President
Marcos 'during his administration, through nominees, by
taking undue advantage of his public office and/or using his
powers, authority, or influence;' and that it was by and
through the same means, that BASECO had taken over the
business and/or assets of the [government-owned] National
Shipyard and Engineering Co., Inc., and other governmentowned or controlled entities." The documentary evidence
shows that petitioner BASECO (read Ferdinand E. Marcos) in
successive transactions all directed and approved by the
former President-in an orgy of what according to the PCGG's
then chairman, Jovito Salonga, in his statement before the
1986 Constitutional Commission, "Mr. Ople once called
'organized pillage' "-gobbled up the government corporation
National Shipyard & Steel Corporation NASSCO its shipyard at
Mariveles, 300 hectares of land in Mariveles from the Export
Processing Zone Authority, Engineer Island itself in Manila and
its complex of equipment and facilities including structures,
buildings, shops, quarters, houses, plants and expendable or
semi-expendable assets and obtained huge loans of
$19,000,000.00 from the last available Japanese war damage
fund, P30,000,000.00 from the NDC and P12,400,000.00 from
the GSIS. The sordid details are set forth in detail in
Paragraphs 1 1 to 20 of the main opinion. They include
confidential reports from then BASECO president Hilario M.
Ruiz and the deposed President's brother-in- law, then Captain
(later Commodore) Alfredo Romualdez, who although not on
record as an officer or stockholder of BASECO reported
directly to the deposed President on its affairs and made the
recommendations, all approved by the latter, for the gobbling
up by BASECO of all the choice government assets and
properties.
All this evidence has been placed of record in the case at bar.
And petitioner has had all the time and opportunity to refute
it, submittals to the contrary notwithstanding, but has
dismally failed to do so. To cite one glaring instance: as stated
in the main opinion, the evidence submitted to this Court by
the Solicitor General "proves that President Marcos not only
exercised control over BASECO, but also that he actually owns
well nigh one hundred percent of its outstanding stock." It
cites the fact that three corporations, evidently front or
dummy corporations, among twenty shareholders, in name, of
BASECO, namely Metro Bay Drydock, Fidelity Management,
Inc. and Trident Management hold 209,664 shares or 95.82%,
of BASECO's outstanding stock. Now, the Solicitor General
points out further than BASECO certificates "corresponding to
more than ninety-five percent (95%) of all the outstanding
shares of stock of BASECO, endorsed in blank, together with
deeds of assignment of practically all the outstanding shares
of stock of the three (3) corporations above mentioned (which
hold 95.82% of all BASECO stock), signed by the owners
thereof although not notarized" 7 were found in Malacaang
shortly after the deposed President's sudden flight from the
country on the night of February 25, 1986. Thus, the main
opinion's unavoidable conclusion that "(W)hile the petitioner's
counsel was quick to dispute this asserted fact, assuring this
Court that the BASECO stockholders were still in possession of
their respective stock certificates and had 'never endorsed * *
may be said that even more than self- defense, the recovery
of ill-gotten wealth and of the government's own properties
involves the material and moral survival of the nation, marked
as the past regime was by the obliteration of any line between
private funds and the public treasury and abuse of unlimited
power and elimination of any accountability in public office, as
the evidence of record amply shows.
It should be
President's
fortuitously
certificates
country last
oral
Separate Opinions
TEEHANKEE, CJ., concurring:
I fully concur with the masterly opinion of Mr. Justice Narvasa.
In the process of disposing of the issues raised by petitioner
BASECO in the case at bar, it comprehensively discusses the
laws and principles governing the Presidential Commission on
Good Government (PCGG) and defines the scope and extent
of its powers in the discharge of its monumental task of
recovering the "ill-gotten wealth, accumulated by former
President Ferdinand E. Marcos, his immediate family, relatives,
subordinates and close associates, whether located in the
Philippines or abroad (and) business enterprises and entities
owned or controlled by them during I . . .(the Marcos)
administration, directly or through nominees, by taking undue
advantage of their public office and/or using their powers,
authority, influence, connections or relationship." 1
The Court is unanimous insofar as the judgment at bar
upholds the imperative need of recovering the ill-gotten
properties amassed by the previous regime, which "deserves
the fullest support of the judiciary and all sectors of
society." 2 To quote the pungent language of Mr. Justice Cruz,
"(T)here is no question that all lawful efforts should be taken
yet been established in the proper court that what the PCGG
has taken over here aregovernment properties, as a matter of
record and public notice and knowledge, like the NASSCO, its
Engineer Island and Mariveles Shipyard and entire complex,
which have been pillaged and placed in the name of the
dummy or front company named BASECO but from all the
documentary evidence of record shown by its street
certificates all found in Malacanang should in reality read
"Ferdinand E. Marcos" and/or his brother-in-law. Such takeover can in no way be termed "lawless usurpation," for the
government does not commit any act of usurpation in taking
over its own properties that have been channeled to
dummies, who are called upon to prove in the proper court
action what they have failed to do in this Court, that they
have lawfully acquired ownership of said properties, contrary
to the documentary evidence of record, which they must
likewise explain away. This Court, in the exercise of its
jurisdiction on certiorari and as the guardian of the
Constitution and protector of the people's basic constitutional
rights, has entertained many petitions on the part of parties
claiming to be adversely affected by sequestration and other
orders of the PCGG, This Court set the criterion that such
orders should issue only upon showing of a prima facie case,
which criterion was adopted in the 1987 Constitution. The
Court's judgment cannot be faulted if much more than
a prima facie has been shown in this case, which the faceless
figures claiming to represent BASECO have failed to refute or
disprove despite all the opportunity to do so.
The record plainly shows that petitioner BASECO which is but
a mere shell to mask its real owner did not and could not
explain how and why they received such favored and
preferred treatment with tailored Letters of Instruction and
handwritten personal approval of the deposed President that
handed it on a silver platter the whole complex and properties
of NASSCO and Engineer Island and the Mariveles Shipyard.
It certainly would be the height of absurdity and helplessness
if this government could not here and now take over the
possession and custody of its very own properties and
assets that had been stolen from it and which it had pledged
to recover for the benefit and in the greater interest of the
Filipino people, whom the past regime had saddled with a
huge $27-billion foreign debt that has since ballooned to
$28.5-billion.
Thus, the main opinion correctly concludes that "(I)n the light
of the affirmative showing by the Government that,prima
facie at least, the stockholders and directors of BASECO as of
April, 1986 were mere 'dummies,' nominees or alter egos of
President Marcos; at any rate, that they are no longer owners
of any shares of stock in the corporation, the conclusion
cannot be avoided that said stockholders and directors have
no basis and no standing whatever to cause the filing and
prosecution of the instant proceeding; and to grant relief to
BASECO, as prayed for in the petition, would in effect be to
restore the assets, properties and business sequestered and
taken over by the PCGG to persons who are 'dummies'
nominees or alter egos of the former President." 9
And Justice Padilla in his separate concurrence "called a spade
a spade," citing the street certificates representing 95 % of
BASECO's outstanding stock found in Malacaang after Mr.
Marcos' hasty flight in February, 1986 and the extent of the
control he exercised over policy decisions affecting BASECO
and concluding that "Consequently, even ahead of judicial
proceedings, I am convinced that the Republic of the
Philippines, thru the PCGG, has the right and even the duty to
take over full control and supervision of BASECO."
Indeed, the provisional remedies available to respondent
commission are rooted in the police power of the State, the
most pervasive and the least limitable of the powers of
Government since it represents "the power of sovereignty, the
oral
EN
[G.R.
BANC
No.
126297
February
02,
2010]
RESPONDENTS.
[G.R.
NO.
126467]
NATIVIDAD
[SUBSTITUTED
BY
HER
CHILDREN
AND
JUAN
FUENTES,
RESPONDENTS.
MIGUEL
NO.
AMPIL,
127590]
PETITIONER,
ENRIQUE
VS.
NATIVIDAD
AGANA,
AND
RESPONDENTS.
RESOLUTION
CORONA, J.:
With prior leave of court,1 petitioner Professional Services, Inc.
But for all my full agreement with the basic thesis of the
majority, I regret I find myself unable to support its
conclusions in favor Of the respondent PCGG. My view is that
these conclusions clash with the implacable principles of the
free society. foremost among which is due process. This
demands our reverent regard.
Due process protects the life, liberty and property of every
person, whoever he may be. Even the most despicable
criminal is entitled to this protection. Granting this distinction
to Marcos, we are still not justified in depriving him of this
guaranty on the mere justification that he appears to own the
BASECO shares.
I am convinced and so submit that the PCGG cannot at this
time take over the BASECO without any court order and
exercise thereover acts of ownership without court
supervision. Voting the shares is an act of ownership.
Reorganizing the board of directors is an act of ownership.
Such acts are clearly unauthorized. As the majority opinion
itself stresses, the PCGG is merely an administrator whose
authority is limited to preventing the sequestered properties
from being dissipated or clandestinely transferred.
of
Agana
(Aganas).
and
jack
up
the
cost
of
health
care.
The Special First Division of the Court granted the motions for
intervention
Natividad
of
6
intervenors), and
MMSI,
AHI
referred en
and
PHAP
consulta to
the
(hereafter
Court en
banc the motion for prior leave of court and the second
motion
for
reconsideration
of
PSI.7
premises.9
To recall the salient facts, PSI, together with Dr. Miguel Ampil
(Dr. Ampil) and Dr. Juan Fuentes (Dr. Fuentes), was impleaded
was
10
liable
for
the
negligence
of
Dr.
Ampil.
Trial Court (RTC) of Quezon City, Branch 96, for the injuries
11
which were
owner,
operator
and
manager
of
the
hospital.
solidarily
the
liable
13
damages.
with
Dr.
Ampil
and
Dr.
Fuentes
for
reported
missing
gauzes.28
Fuentes but affirmed the liability of Dr. Ampil and PSI, subject
to the right of PSI to claim reimbursement from Dr. Ampil.
14
16
15
2008.17
February
11,
the
following
facts
and
law:
vs. Court of Appeals (G.R. No. 134354, April 11, 2002), which
and PSI proved that it has no control over Dr. Ampil. In fact,
hospitals
and
in Ramos later
their
consultants."
issued
19
Although
Resolution
dated
the
Court
11,
April
Dr.
Second,
by
accrediting
Dr.
Ampil
and
advertising
his
contractors.
II
186937 of
the
Civil
Code
or
the
principle
of
apparent
corporate negligence.29
both the means and the details of the process by which the
physician
is
to
accomplish
his
task.
all
parties.30
three
xx
xx
xx
31
assailed
decision
and
resolution.
observed
under
pain
of
administrative
sanctions.
holds that PSI is liable to the Aganas, not under the principle
of respondeat superior for lack of evidence of an employment
ostensible agency for the negligence of Dr. Ampil and, pro hac
emergency
to
perform
its
duties
as
hospital.
room,
the
operating
room,
or
any
medicine,
33
is
not
essential
for
the
employer
to
actually
Even in its December 29, 1999 decision 41 and April 11, 2002
decisive.
2180
35
Court
found
the
control
test
relationship between PSI and Dr. Ampil, and that the Aganas
is shown that the hospital holds out to the patient that the
43
regarding the condition of his wife; that after the meeting and
finding.
such
44
45
46
Ampil
at
the
instigation
of
daughter.51
her
though
long
settled,
was
unwittingly
Atty.
Agcaoili
resurrected.
On that particular occasion, April 2, 1984, what was your
In fine, as there was no dispute over the RTC finding that PSI
with
finding
became
final
and
conclusive
even
to
your
wife's
illness?
this
that
to
47
Court.
may
have
ensued
was
purely
academic.
be
a staff
member of
the
Medical
City
which
is
the RTC and the CA that PSI was not the employer of Dr. Ampil
is correct. Control as a determinative factor in testing the
Hospital,
of
but
and
as
that
said
integrally
hospital
related
was
to
well
known
Medical
and
City.
wielded such power over the means and the details of the
specific process by which Dr. Ampil applied his skills in the
principle
of respondeat
superior.
There is, however, ample evidence that the hospital (PSI) held
out to the patient (Natividad)48 that the doctor (Dr. Ampil) was
its agent. Present are the two factors that determine apparent
authority: first, the hospital's implied manifestation to the
patient which led the latter to conclude that the doctor was
the hospital's agent; and second, the patient's reliance upon
the conduct of the hospital and the doctor, consistent with
ordinary
care
and
prudence.49
By
such
statement,
PSI
virtually
reinforced
the
public
carry
Ampil
them
out.
when
it
was
not
informed
about
it
at
55
hospital
would
have
been obliged
to
act
on
it."56
transpired
ultimate
ostensible
Natividad's
agent.
within
end
its
walls
of
strictly
for
protecting
the
its
purpose
of
patients.
themselves
PSI [sic] is not liable for Dr. Ampil's acts during the operation.
its corporate duty was not limited to having its nursing staff
note or record the two missing gauzes and (c) that its
gauzes. In
regular
addition
check-ups
to
noting
were
the
made
missing
and
no
gauzes,
signs
of
of
its
services
and
facilities.
finding
evident
of
facts
in
this
case.
Likewise
60
Given the standard of conduct that PSI defined for itself, the
it.
61
Dr.
during
Natividad's
operation.
Rather,
it
shirked
surgery, their group talked about the missing gauzes but Dr.
committed
corporate
its
negligence.
To begin with, PSI could not simply wave off the problem and
applies only to this case, pro hac vice. It is not intended to set
initiate
case, for the liability of PSI arose from an implied agency with
the
review
was
non-delegable.
ruling,65 not the least of which being that the agony wrought
failed to notify Natividad did not release PSI from its self-
imposed
the options left to the Aganas have all but dwindled, for the
separate
responsibility.
status
of
Dr.
Ampil
can
no
longer
be
ascertained. 66
Therefore,
taking
all
the
equities
of
this
case
into
resolution
to
full
satisfaction.
the
second
motion
for
reconsideration
case.
SO ORDERED.