G.R. No. 190590, July 12, 2017
ROBERTO V. SAN JOSE AND DELFIN P. ANGCAO, Petitioners, v. JOSE MA. OZAMIZ, Respondent.
D E C I S I O N
Perusal of the complaint shows that the intra-corporate controversy herein involves plaintiff's demand for the production and inspection of 'all the minutes of the meetings of the board of directors, the Executive Committee and such other committees constituted by the PHC from 2000 to 2007. It is noted that Philcomsat has controlling interest in PHC, and that POTC is the beneficial owner of Philcomsat. Both POTC and Philcomsat are sequestered companies being administered by the PCGG.On 3 October 2008, Ozamiz filed with the CA a petition for review under Rule 43 of the Rules of Court to assail the Order of the RTC. Ozamiz argued that the RTC, and not the Sandiganbayan, had jurisdiction over the case because PHC is an unsequestered corporation and the case is not about a supposed violation of the Anti-Graft and Corrupt Practices Act8 or about the forfeiture of ill-gotten wealth under Republic Act (RA) No. 1379.9 Ozamiz argued that since it is a simple case for inspection of books, it is an intra-corporate controversy under RA No. 879910 and the Interim Rules of Procedure for Intra-Corporate Controversies.11
Jurisprudence tells us that not only principal causes of action involving sequestered companies fall under the Sandiganbayan jurisdiction, but also all incidents arising from, incidental to, or related, to such cases (Del Moral, et al. vs. Republic of the Philippines, 457 SCRA 188  citing PCGG vs. Peña, 159 SCRA 556 ). It was further cited in Del Moral that Sequestration is taking into custody under PCGG's control or possession any asset, fund or property, as well as relevant records, papers and documents, in order to prevent their concealment, destruction, impairment or dissipation pending determination of the question whether said asset, fund or property is ill-gotten wealth under Executive Order Nos. 1 and 2.7
In the present case, it bears remembering that only POTC and Philcomsat are under sequestration by the PCGG and not PHC itself. True, POTC appears to wholly own Philcomsat, and Philcomsat, in turn, owns a substantial part of PHC (about 80.35%), but the fact remains that PHC is not under any writ of sequestration issued by the PCGG.In a Resolution dated 9 December 2009,14 the CA denied the Motion for Reconsideration filed by petitioners.
Moreover, while 80.35% of PHC is owned by Philcomsat, it is important to remember that only the said shares corresponding to such a majority ownership of PHC are considered assets of a sequestered corporation. Hence, only the shares corresponding to Philcomsat's 80.35% stake over PHC is a sequestered asset. In fact, as a rule, the PCGG, as a mere conservator of the said shares, does not even automatically exercise acts of dominion over PHC by voting these shares as it is settled that, as a general rule, the registered owner of the shares of a corporation, even if they are sequestered by the government through the PCGG, still exercises the right and the privilege of voting on them (See Cojuangco, Jr. vs. Roxas, G.R. Nos. 91925 & 93005, 16 April 1991, citing Section 24 of the Corporation Code. See also PCGG vs. Cojuangco, Jr., G.R. No. 133197, 27 January 1999).
x x x x
Bearing those in mind, therefore, in the Court's considered view, petitioner's request in the present controversy, by virtue of being a stockholder, to be provided with a copy of all the minutes of the meetings of directors, the Executive Committee and such other committees constituted by PHC, is simply an intra-corporate dispute within PHC. Lest it be forgotten, an intra-corporate dispute has been defined as a dispute which arises between the stockholder and the corporation (Philex Mining Corp. vs. Reyes, 118 SCRA 602). In fact, the va,rious allegations by the respondents that the petitioner's motivation in filing the present complaint is part of a concerted effort by the petitioner's group to wrest control over PHC all the more convinces this Court that the same is nothing more but an intra-corporate dispute within PHC. As such, jurisdiction over the question as to whether the petitioner is entitled to his request pertains to the Regional Trial Court and not the Sandiganbayan.13 (Boldfacing and underscoring in the original)
THE COURT OF APPEALS DID NOT HAVE JURISDICTION TO ENTERTAIN RESPONDENT'S "PETITION FOR REVIEW" DATED OCTOBER 3, 2008 AS IT RAISED PURE QUESTIONS OF LAW;
PURSUANT TO THIS HONORABLE COURT'S RULING IN DEL MORAL VS. REPUBLIC OF THE PHILIPPINES AND OTHER RELATED JURISPRUDENCE, THE TRIAL COURT DID NOT HAVE JURISDICTION OVER RESPONDENT'S COMPLAINT; and
THIS CASE DOES NOT INVOLVE A MERE INTRACORPORATE DISPUTE BECAUSE IT CONCERNS MATTERS RELATING TO THE ASSETS OF A SEQUESTERED CORPORATION.15
In the case at bar, the complaint concerns PHILCOMSAT's demand to exercise its right of inspection as stockholder ofPHC but which petitioners refused on the ground of the ongoing power struggle within POTC and PHILCOMSAT that supposedly prevents PHC from recognizing PHILCOMSAT's representative (Africa) as possessing such right or authority from the legitimate directors and officers. Clearly, the controversy is intra-corporate in nature as they arose out of intracorporate relations between and among stockholders, and between stockholders and the corporation.20 (Boldfacing and underscoring supplied)In this wise, we find that the dispute at hand, which involves the stockholder, Ozamiz, demanding to inspect the books of PHC and the consequent refusal of the corporation to show its books, is simply an intracorporate dispute. And because this is an intra-corporate dispute, the matter was properly elevated to the CA. A.M. No. 04-9-07-SC21 provides:
WHEREFORE, the Court Resolves:The order of the RTC dismissing the case for lack of jurisdiction was a final order under the Interim Rules of Procedure Governing Intra Corporate Controversies under RA No. 8799, which was the effective set of rules when the complaint and subsequent appeal were filed. Thus, the proper remedy was to appeal the order to the CA through a petition for review under Rule 43 of the Rules of Court. The CA was therefore correct in taking cognizance of the appeal.
1. All decisions and final orders in cases falling under the Interim Rules of Corporate Rehabilitation and the Interim Rules of Procedure Governing Intra-Corporate Controversies under Republic Act No. 8799 shall be appealable to the Court of Appeals through a petition for review under Rule 43 of the Rules of Court. (Boldfacing and underscoring supplied)
Section 4. Jurisdiction. The Sandiganbayan shall have jurisdiction over:In turn, these Executive Orders refer to the recovery by the PCGG of the illgotten wealth of former President Ferdinand E. Marcos, his relatives, dummies, and other agents. This Court held in PCGG v. Peña:22
c. Civil and criminal cases filed pursuant to and in connection with Executive Order Nos. 1, 2, 14 and 14-A, issued in 1986.
On the issue of jurisdiction squarely raised, as above indicated, the Court sustains petitioner's stand and holds that regional trial courts and the Court of Appeals for that matter have no jurisdiction over the Presidential Commission on Good Government in the exercise of its powers under the applicable Executive Orders and Article XVIII, [S]ection 26 of the Constitution and therefore may not interfere with and restrain or set aside the orders and actions of the Commission. Under [S]ection 2 of the President's Executive Order No. 14 issued on May 7, 1986, all cases of the Commission regarding "the Funds, Moneys, Assets, and Properties Illegally Acquired or Misappropriated by Former President Ferdinand Marcos, Mrs. Imelda Romualdez Marcos, their Close Relatives, Subordinates, Business Associates, Dummies, Agents, or Nominees" whether civil or criminal, are lodged within the "exclusive and original jurisdiction of the Sandiganbayan" and all incidents arising from, incidental to, or related to, such cases necessarily fall likewise under the Sandiganbayan's exclusive and original jurisdiction, subject to review on certiorari exclusively by the Supreme Court. (Boldfacing and underscoring supplied)Petitioners' insistence that the RTC has no jurisdiction over the case seems to be based on the interpretation of the phrase "all incidents arising from, incidental to, or related to such cases necessarily fall likewise under the Sandiganbayan's exclusive and original jurisdiction." Unfortunately, this is an erroneous interpretation because the term "cases," as referred to in the said paragraph, pertains to "the Funds, Moneys, Assets, and Properties Illegally Acquired or Misappropriated by Former President Ferdinand Marcos, Mrs. Imelda Romualdez Marcos, their Close Relatives, Subordinates, Business Associates, Dummies, Agents, or Nominees." In this case, there is no question on any illegally acquired or misappropriated property by former President Marcos or his agents. This case does not relate to the recovery of ill-gotten wealth or any property that needs to be sequestered or assets that have already been placed under sequestration. Thus, the subject matter of this case does not arise from, or is incidental to, or is related to the Executive Orders cited in the law that would vest jurisdiction with the Sandiganbayan.
Section 5.2. The Commission's jurisdiction over all cases enumerated under Section 5 of Presidential Decree No. 902-A is hereby transferred to the Courts of general jurisdiction or the appropriate Regional Trial Court: Provided, That the Supreme Court in the exercise of its authority may designate the Regional Trial Court branches that shall exercise jurisdiction over the cases. The Commission shall retain jurisdiction over pending cases involving intra-corporate disputes submitted for final resolution which should be resolved within one (1) year from the enactment of this Code. The Commission shall retain jurisdiction over pending suspension of payments/rehabilitation cases filed as of 30 June 2000 until finally disposed. (Boldfacing and underscoring supplied)The Interim Rules of Procedure for Intra-Corporate Controversies also provide:
Based on the foregoing, we find no reversible error on the part of the CA when it remanded the case back to the RTC upon finding that the RTC had jurisdiction over the complaint for inspection 'Of books filed by Ozamiz.
Section 1. (a) Cases covered. - These Rules shall govern the procedure to be observed in civil cases involving the following:(1) Devices or schemes employed by, or any act of, the board of directors, business associates, officers or partners, amounting to fraud or misrepresentation which may be detrimental to the interest of the public and/or of the stockholders, partners, or members of any corporation, partnership, or association;x x x x
(2) Controversies arising out of intra-corporate, partnership, or association relations, between and among stockholders, members, or associates; and between, any or all of them and the corporation, partnership, or association of which they are stockholders, members, or associates, respectively;
(3) Controversies in the election or appointment of directors, trustees, officers, or managers of corporations, partnerships, or associations;
(4) Derivative suits; and
(5) Inspection of corporate books.
Sec. 5. Venue. - All actions covered by these Rules shall be commenced and tried in the Regional Trial Court which has jurisdiction over the principal office of the corporation, partnership, or association concerned. Where the principal office of the corporation, partnership or association is registered in the Securities and Exchange Commission as Metro Manila, the action must be filed in the city or municipality where the head office is located.25 (Boldfacing and underscoring supplied)
* On leave.
1Rollo, pp. 35-58. Penned by Associate Justice Romeo F. Barza, with Associate Justices Remedios A. Salazar-Fernando and Isaias P. Dicdican concurring.
2 Id. at 61-62.
3 Id. at 63-64.
4 Id. at 77-84.
5 Id. at 75.
6 Id. at 101-108.
7 Id. at 63-64.
8 Republic Act No. 3019.
9Rollo, pp. 148-150
10 The Securities Regulations Code.
11Rollo, p. 154.
12 Id. at 57.
13 Id. at 53-54, 56-57.
14 Id. at 61-62.
15 Id. at 16.
16 Dated 14 September 2004.
17Philippine Communications Satellite Corporation v. Sandiganbayan, 5th Division, G. R. No. 203023, 17 June 2015, 759 SCRA 242, citing Medical Plaza Makati Condominium Corp. v. Cullen, 720 Phil. 732, 742-743 (2013).
18 Id., citing Strategic Alliance Development Corporation v. Star Infrastructure Development Corporation, 649 Phil. 669, 691 (2010) and Reyes v. RTC of Makati, Br. 142, 583 Phil. 591, 608 (2008).
19 756 Phil. 294 (2015).
20 Id. at 306.
21 Dated 14 September 2004.
22 243 Phil. 93, 102 ( 1988).
23 496 Phil. 657 (2005).
24 Section 5, PD No. 902-A provides:
Section 5. In addition to the regulatory and adjudicative functions of the Securities and Exchange Commission over corporations, partnerships and other forms of associations registered with it as expressly granted under existing laws and decrees, it shall have original and exclusive jurisdiction to hear and decide cases involving:
x x x x
b. Controversies arising out of intra-corporate or partnership relations, between and among stockholders, members, or associates; between any or all of them and the corporation, partnership or association of which they are stockholders, members or associates, respectively; and between such corporation, partnership or association and the state insofar as it concerns their individual franchise or right to exist as such entity;
x x x x
25 A.M. No. 01-2-04-SC.