G.R. No.

L-50054 August 17, 1988 said motion interrupted the period for filing their notice of appeal, respondents had only one
(1) day left within which to appeal, which was on August 26, 1978, one day after the
respondents received the denial of their motion. Therefore, since the respondents filed their
ETERNAL GARDENS MEMORIAL PARK CORPORATION, petitioner, 
appeal only on October 2, 1978, the same was filed out of time being 37 days late.
vs.
THE HONORABLE COURT OF APPEALS and RESIDENTS OF BAESA, CALOOCAN CITY,
respondents. The respondents filed a motion to expunge from the records the petitioner's motion to dismiss
on the ground that the latter failed to state the time and place for hearing in violation of
sections 4 and 5 of Rule 15 of the Rules of Court.
GUTIERREZ, JR., J.:

The appellate court granted the respondents' motion on January 10, 1979. The petitioner
Petitioner Eternal Gardens Memorial Park Corporation (Eternal Gardens) applied for a
moved to reconsider the court's order but the same was denied on February 8, 1979.
certificate of clearance from the National Pollution Control Commission (NPCC), to operate a
Consequently, it filed this instant petition for certiorari and mandamus with preliminary
memorial park at the former site of the Philippine Union College in Baesa, Caloocan City,
injunction, alleging that the appellate court committed grave abuse of discretion in dismissing
Metro Manila. The private respondents, "Residents of Baesa" opposed the application on the
its motion on the ground that said motion did not contain any notice of hearing for such notice
ground that the project would cause pollution of water resources in the area.
is not required in motions or pleadings filed with the appellate court.

While hearings were being conducted by the NPCC, the petitioner allowed an interment to
While the petition was pending before this Court, the appellate court, on March 27,1979,
take place in its cemetery. The private respondents filed a telegram complaint with the NPCC
issued motu proprio a resolution recalling its order granting the respondents' motion to
requesting the latter to investigate and look into the legality of the said interment, The
expunge petitioner's motion to dismiss. It considered the motion submitted for resolution.
complaint was incorporated with the original application for clearance filed by the petitioner.

Upon a finding that the objections raised by the respondents were not without remedy and
that the project had been approved by the Metro Manila Commission, the Regional Health
Office No. 4 and the Mayor of the City of Caloocan, the NPCC issued an order granting the
petitioner a certificate of clearance to operate a memorial park at Baesa, Caloocan City
subject to the condition that it submit the following: (1) A design of its interment vaults duly
certified by a registered structural engineer that such vaults will not crack from earthquakes
with intensity No. 7 and above on the Richter Scale; and (2) A certification covering each
interment vault to be used that the same has passed a rigid quality control test according to
the latest concept of interment to the effect that it is structurally sound, free from the tiniest
crack, and waterproof The said order was received by the respondents on April 20, 1978.
On May 4, 1978, the respondents filed a motion for reconsideration. On August 22, 1978, the
NPCC denied the motion. However, it imposed a fine of P1,000.00 on the petitioner for
causing an interment to take place without any prior permit from the NPCC.
On April 5, 1979, the appellate court issued another resolution granting the petitioner's motion
to dismiss the respondents' appeal on the ground that it was filed out of time.
In view of the aforementioned dismissal of the appeal, the petitioner filed a manifestation and
motion to withdraw the petition for certiorari filed before this Court on the ground that it had
become moot and academic.
On September 10, 1979, this Court issued a resolution requiring the respondents to comment
on petitioner's manifestation and motion to withdraw the petition. The Court of Appeals and
the Division Clerk of said Court were also directed to explain why the appellate court issued
motu proprio its resolutions dated March 27 and April 5, 1979, respectively, notwithstanding
the said matters were no longer within its jurisdiction by virtue of the pendency of the present
petition in this Court wherein the petitioner has raised precisely the same issues for
determination, and to comment on the timeliness of respondents' appeal.

On September 8, 1978, the respondents filed a notice of appeal and an ex-parte urgent In their comment, the respondents averred that the petition should not be dismissed for being
motion for extension of time to file appeal or petition for review with the appellate court moot and academic because the resolutions in question were not only violative of the
praying for an extension of thirty (30) days to perfect the appeal. The docket fee, however, respondents' right to due process of law but were also null and void for having been issued
was paid only on October 2, 1978. without jurisdiction.

In a resolution dated October 4, 1978, the appellate court granted the respondents'
motion, subject to the conditions that the same is filed within the reglementary period and
that the decision sought to be reviewed is appealable. Thereafter, the respondents filed the
corresponding appeal.
On November 21, 1978, the petitioner filed a motion to dismiss the appeal on the ground that
the same was filed out of time. According to the petitioner, since the respondents received
the NPCC's order on April 20, 1978, they had up to May 5, 1978 or 15 days within which to
perfect their appeal, pursuant to section 6 of Rule 122 of the Rules of Court. However, on
May 4, 1978, the respondents filed a motion for reconsideration. Thus, assumming that the
The respondent appellate court, through its division clerk, filed a compliance contending that
the present petition did not divest the said court of jurisdiction to correct its processes and
orders and, therefore, the questioned resolutions were issued within its lawful jurisdiction. It
stated that the petition filed with this Court was under Rule 65 of the Revised Rules of Court
and not under Rule 45 thereof because there is as yet no final determination and judgment of
the case pending with the respondent court and what was actually elevated to this Court were
only interlocutory orders. Therefore, the main case still remaining with the appellate court, the
latter had jurisdiction to correct such orders unless restrained by this Court.
On the matter of the timeliness of respondents' appeal, the appellate court contended that
although the respondents filed by registered mail their ex parte motion for extension of time to
file an appeal or petition for review on September 8, 1978, the Court did not consider such
motion as filed until after October 2, 1978 when respondents paid the docketing fee.
Furthermore, even granting that the latter filed their notice of appeal on September 8,1978,
still, the same was filed outside the reglementary period to appeal because after the denial of
respondents motion for reconsideration on August 25, 1978, they had only two days left to
perfect their appeal which was on August 27, 1978.
On November 16, 1979, this court issued a resolution dated November 14, 1979, giving due
course to the petition and requiring both parties to submit their respective memoranda on the
basic issues of (1) whether or not respondents' appeal was timely submitted to the appellate
court and should be resolved on the merits and (2) whether the said court had jurisdiction to
issue motu proprio its resolutions dated March 27 and April 5, 1979 notwithstanding the
pendency of the present petition filed with this Court on March 5, 1979.
With regard to the jurisdiction of the appellate court in issuing the resolutions dated March 27
and April 5, 1979 respectively, the petitioner argues that since it filed a petition for certiorari
under Rule 65 which means that such a petition is a special civil action, the appellate court
did not lose its jurisdiction to correct interlocutory orders that may have been issued
erroneously.
Resolution, a party can simultaneously file a Petition for Review before this
Tribunal as well as a Motion for Reconsideration before respondent Court. This
interpretation does havoc to the rules on orderly procedure. A party should not be
allowed to pursue simultaneous remedies in two different forums.
xxx xxx xxx
xxx xxx xxx
We find the foregoing without merit. The Writ of certiorari is intended to keep a
tribunal within the limits of its jurisdiction. As explained above, respondent court
acted without or in excess of its jurisdiction and with grave abuse of discretion
when it passed upon private respondents Fourth Motion for Reconsideration
considering that its judgment of conviction had already become final. And what is
even more glaring, respondent Court acted on said Fourth Motion for
Reconsideration after this Tribunal had already denied private respondents' petition
for Review on Certiorari, as well as the reconsideration thereof. The attention of
respondent Court, as explained heretofore, was called to such development. It paid
no heed. Although now, it is claimed that had it known, it would have stopped
action or desisted from taking any at any stage in which the fourth (4th) motion for
reconsideration was found.

On the other hand, the respondents maintain that while under the Rules of Court, courts may
Applying the foregoing precedent, we rule that the appellate court acted with grave abuse of
amend, modify or revoke any decision or order promulgated by them, such power of authority
or in excess of jurisdiction when it issued the resolutions dated March 27 and April 5, 1979
is not absolute. They state that among the limitations thereof are when a judgment has
correcting its earlier erroneous orders which were already before us.
become final and when an appeal has been interposed on time. Accordingly, while it is true
that what is pending in the present case is neither a final judgment nor an appeal by
certiorari, the effect thereof would be the same. Therefore, out of respect and courtesy for the On the second issue of whether or not respondents perfected their appeal on time, the
higher court, the lower court should have suspended all pending proceedings in the elevated petitioner argues that clearly, the respondents appeal was filed out of time since by their own
case as even without any restraining order, the lower court had lost jurisdiction to further act admission, respondents filed their notice of appeal only on September 8, 1978, when they
on the case. had only up to August 27, 1978 to file the same.

We agree with the respondents on this point. Conversely, the respondents maintain that the period should be reckoned from August 25,
1978, the date when they received the second order of the NPCC because said order
amended or modified the order of August 18, 1978 and, therefore, since there was such an
Although this Court did not issue any restraining order against the Intermediate Appellate
amendment, the period to perfect the appeal commenced to again start from August 25,
Court to prevent it from taking any action with regard to its resolutions respectively granting
1978.
respondents' motion to expunge from the records the petitioner's motion to discuss and
denying the latter's motion to reconsider such, order, upon learning of the petition, the
appellate court should have refrained from ruling thereon because its jurisdiction was We find the petitioner's contention well-taken.
necessarily limited upon the filing of a petition for certiorari with this Court questioning the
propriety of the issuance of the above-mentioned resolutions. Due respect for the Supreme
It should be noted that when the respondents filed a motion for reconsideration of the order
Court and practical and ethical considerations should have prompted the appellate court to
issued by the NPCC dated August 18, 1978, the same was denied by the latter on August 22,
wait for the final determination of the petition before taking cognizance of the case and trying
1978, Notice of the denial was received by the respondents on August 25, 1978. The
to render moot exactly what was before this court. As we have ruled in the case of  People v.
dispositive portion of the order of denial states:
Court of Appeals, (101 SCRA 450, 463 and 466):

WHEREFORE, premises considered, the instant motion for reconsideration of

... Thirdly, the statement that whatever rights the movants were allowed to exercise
Complainants Oppositors is hereby denied. Applicant-Respondent, through its
in the Supreme Court could be exercised by them in the Court of Appeals' is clearly
President or managing head, is hereby Ordered to pay to the Government through
misplaced. It implies concurrence of jurisdiction between this Tribunal and
this Commission a fine of One Thousand (Pl,000.00) Pesos pursuant to Section 9
respondent Court, which is totally unacceptable. It would lead to the absurd
(b) of Presidential Decree No. 984 for violation of Section 8 of the same decree.
situation where within the reglementary period from finality of a Decision or
SO ORDERED. (Rollo, p. 75)
It is clear from the above-quoted order that as far as the respondents are concemed there
was no amendment of the NPCC's previous orders which would justify the running anew of
the period to appeal. The only modification found in the order did not pertain to the
respondents but to the petitioner which was fined for allowing an illegal interment. The
respondents cannot allege that the order of August 22, 1978 was more adverse to them since
it was the petitioner which was fined. After the denial of the respondents' motion for
reconsideration, they only had one day to perfect their appeal which was on August 26, 1978.
Therefore, their filing of an appeal on September 8, 1978 was definitely out of time. We ruled
in the case of Garcia v. Echiverri, (132 SCRA 631, 638):

Well-rooted is the principle that perfection of an appeal within the statutory or

reglementary period is not only mandatory but also jurisdictional and failure to do
so renders the questioned decision final and executory that deprives the appellate
court of jurisdiction to alter the final judgment much less to entertain the appeal.
(Acda v. Minister of Labor, 119 SCRA 309; Agricultural and Industrial Marketing,
Inc. v. CA, 118 SCRA 49; Santos v. CA, 125 SCRA 22).

Even assuming arguendo that the fifteen (15) day period to appeal started anew on August
25, 1978, the day when respondents received the order of August 22, 1978, still their appeal
was perfected out of time since the perfection of the same should be reckoned not from the
filing of the notice of appeal but from the payment of docketing fees. The respondents paid
the docket fees only on October 2, 1978. We stated in the case of  Aranas v. Endona, (117
SCRA 753, 758):

As early as November 16, 1932 this Court rendered a decision in Lazaro v.

Endencia and Andres (57 Phil, 552) that full payment of docket fees within the
required period is an 'indispensable step' for the perfection of an appeal. ... xxx xxx
xxx

Payment of the full amount within the reglementary period was declared
jurisdictional.

The jurisdictional nature of this requirement continues to the present ...

xxx xxx xxx

Inasmuch as the respondents' appeal was perfected out of time, the appellate court did not
acquire jurisdiction over it. Consequently, its appealed orders before this Court and all other
orders it issued with regard to the present case are null and void.

We have carefully examined the records for any substantial considerations of equity which
might warrant different conclusions on the basic merits of the main case. We have found
none.

WHEREFORE, the petition is GRANTED and the orders of the appellate court dated January
10, 1979, February 8, 1979, March 27, 1979 and April 5, 1979 are annulled and set aside.
Considering that the respondents' appeal was perfected long after the due date, the order of
the National Pollution Control Commission dated April 18, 1978 is hereby declared FINAL.

54 AURILLO v RABI G.R. No. 120014
DATE: November 26, 2002
By: Enzo
Topic: Certiorari, Prohibition and Mandamus
Petitioners: FRANCISCO Q. AURILLO, JR.
Respondents: NOEL RABI, and THE REGIONAL TRIAL COURT, Branch 9, Tacloban City
Ponente: Callejo, Sr., J.
FACTS
1. Noel Rabi was arrested without a warrant of arrest and charged in the Office of the City
Prosecutor of Tacloban City with violation of Presidential Decree No. 1866 (possession of
unlicensed firearm).
2. PUB PROSEC RULING: case be dismissed
 Public Prosecutor Zenaida Camonical Isidro conducted an inquest investigation of the
case and issued a resolution recommending that the case be dismissed for lack of
probable cause on her findings that the material averments of the Joint Affidavit
executed by the arresting police officers were hearsay
3. However, Regional State Prosecutor Francisco Aurillo, Jr. of Region VIII decided to assume
jurisdiction over the case and to order the conduct of a new preliminary investigation
thereof. He issued an Order to the City Prosecutor of Tacloban City directing him to
elevate to his office the complete records. Aurillo designated the assistant regional state
prosecutor to conduct the new preliminary investigation of
4. The City Prosecutor of Tacloban complied with the order of Aurillo. The Assistant Regional
State Prosecutor issued a subpoena notifying Noel Rabi and Margot Villanueva of the
preliminary investigation
5. When served with the subpoena on January 27, 1995, Rabi was aghast at the sudden turn
of events. His counsel forthwith filed with the Regional Trial Court of Tacloban City a
petition for prohibition with prayer for a temporary restraining order or a writ of
preliminary injunction. Rabi contended that Aurillo acted without jurisdiction or with grave
abuse of discretion amounting to excess or lack of jurisdiction.
 Under the 1987 Revised Administrative Code and PD 1275 as implemented by
Department Order No. 318 of the Department of Justice, a regional state prosecutor
was vested only with administrative supervision over the city prosecutor and had no
power to motu proprio review, revise, or modify the resolution of the city prosecutor
on the latter's conduct of a preliminary or inquest investigation of a criminal
complaint filed directly therewith.
6. RTC RULING: the RTC rendered judgment in favor of Rabi.
 The trial court nullified the preliminary investigation by the Office of the Regional
State Prosecutor and the Information filed with the RTC against Rabi.
7. Aurillo thereafter filed the instant petition for review on certiorari, on questions of law,
against Rabi and the Regional Trial Court, Branch 9, Tacloban City.
 Aurillo contends that the RTC erred when it nullified the Information filed by him
charging private respondent with violation of PD 1866 after the requisite preliminary
investigation by the office of regional state prosecutor. He argues that although the
RTC had issued a Temporary Restraining Order, the same had lapsed without the
court issuing any preliminary injunction. There was thus no legal bar for the Office of
the Regional State Prosecutor to proceed with and terminate the preliminary
investigation and thereafter to file the Information against private respondent even
while the petition for prohibition was still pending before the RTC. He further asserts
that the remedy of Rabi was to file with the trial court a Motion to Quash the
Information on the ground that the office of the regional state prosecutor had no
authority to conduct a preliminary investigation and file the same.
ISSUE: WON THE INFORMATION 􏰊FILED BY AURILLO AGAINST RABI WITH THE RTC FOR VIOLATION
OF PD 1866 MAY BE NULLI􏰊ED BY SAID court? YES!
HELD:
8. Jurisprudence has it that prohibition will give complete relief not only by preventing what
remains to be done but by undoing what has been done. The Court has authority to grant
any appropriate relief within the issues presented by the pleadings of the parties.
Generally, the relief granted in a prohibition proceeding is governed by the nature of the
grievance proved and the situation at the time of judgment. Although the general rule is
that a writ of prohibition issues only to restrain the commission of a future act, and not to
undo an act already performed, where anything remains to be done by the court,
prohibition will give complete relief, not only by preventing what remains to be done but
by undoing what has been done. Under some statutes, the court must grant the
appropriate relief whatever the proceeding is called if facts stating ground for relief are
pleaded. Although prohibition is requested only as to a particular matter, the court has
authority to grant any appropriate relief within the issues presented by the pleadings. If
the application for prohibition is too broad, the court may mould the writ and limit it to as
much as is proper to be granted. In the exercise of its jurisdiction to issue writs, the court
has, as a necessary incident thereto, the power to make such incidental order as may be
necessary to maintain its jurisdiction and to effectuate its final judgment. The court may
retain jurisdiction of the cause to enable it to make an appropriate order in the future,
even though the petition for a writ of prohibition is dismissed.
9. Hence, the RTC did not commit any error in nullifying not only the preliminary
investigation by the Office of the Regional State Prosecutor in I.S. No. 95-043 for want of
authority but also the Information approved by Aurillo and filed with the Regional Trial
Court.
10. The pendency of the special civil action for prohibition before the trial court did not
interrupt the investigation in I.S. No. 95-043. It goes without saying, however, that in
proceeding with the preliminary investigation of I.S. No. 95-043 and terminating the same,
Aurillo did so subject to the outcome of the petition for prohibition. In this case, the RTC
granted the petition of Rabi, declared Aurillo bereft of authority to take over the
preliminary investigation of I.S. No. 95-043 and nullified the preliminary investigation
conducted by Aurillo as well as the Information thereafter 􏰊led by him. The RTC is
possessed of residual power to restore the parties to their status before Aurillo proceeded
with the preliminary investigation, and grant in favor of the aggrieved party such other
relief as may be proper.
RULING: IN THE LIGHT OF ALL THE FOREGOING, the decision of the Regional Trial Court granting the
petition for prohibition of Rabi is AFFIRMED with MODIFICATION. The awards for moral and
exemplary damages and attorney's fees are DELETED. No costs.

[G.R. No. 123910. April 5, 1999]
GODOFREDO UNILONGO, ZENAIDA TIPACE, MERLYN ARAOJO, YOLANDA
GUPILAN, ARTURO PATULAN, DAVID VILLAR, GLEN ARIOLA, MAXIMO
GONZALES, ANGIE NAVARRO, RUEL DIVINA, ARON INFANTE, LIZA
CORPUZ, and STO. NIO DE CUL DE SAC HOMEOWNERS' ASSOCIATION,
INC., Petitioners, v. THE HON. COURT OF APPEALS, HON. RUBEN A.
MENDIOLA, Presiding Judge, Br. 63, Makati, BIENVENIDO R. DINO,
RUBEN DINO, EDGARDO S. FERRY, WILFREDO E. NERY, IMELDA P.
NIEVA, JOB E. FERNANDEZ, ZAIDE B. ABDULLAH, JOSELITO F. FLOR,
FRANCISCO C. QUINQUERO, ANGELES C. TAMAYO, ROGELIO B. UY,
EMILIO L. ESPINIDA, MARIANITA L. DE GUZMAN, NOEL ODENA and STO.
NIO DE CUL DE SAC NEIGHBORHOOD ASSOCIATION, INC., and JULIAN
GO, Respondents.
DECISION
KAPUNAN, J.:
This special civil action for certiorari under Rule 65 of the Rules of Court was
instituted by petitioners to set aside the decision of the Court of Appeals dated 13
October 1995 dismissing their petition for certiorari and prohibition for lack of
merit. Similarly assailed is the Court of Appeals' resolution dated 2 January 1996
denying petitioners' motion for reconsideration of said decision.
The issue to be resolved in this case is whether it is the ordinary courts or the
Home Insurance and Guarantee Corporation which has jurisdiction over the
corporate controversy between the contending groups both of which claim to be
the rightful officers of a homeowners association.
On 24 November 1992, private respondents filed a complaint for Quo
Warranto with Damages against petitioners before the Regional Trial Court of
Makati (Branch 63).
The allegations of the 22-page complaint may be summarized as follows:
1. On 4 July 1989, the Sto. Nio de Cul de Sac Neighborhood Association,
Inc. (SNSNAI), was incorporated and registered by petitioners (hereafter referred
to as the Unilongo group) as a non-stock corporation with the Securities and
Exchange Commission (SEC). Petitioners comprised SNSNAI's original Board of
Trustees.
2. However, since no elections for a new Board of Trustees and for a new
set of corporate officers were held from the time of its incorporation, private
respondents (hereafter referred to as the Dio group) aired their complaints and
sought the intervention of the Office of the Mayor of Paraaque and the SEC.
3. On 29 April 1991, the Unilongo group amended the SNSNAI's By-Laws by
changing the term of office of the Board of Trustees from 1 year to 2 years.
4. Despite the above amendment, elections were held on 5 May 1991 and
the Dio group emerged as the new Board of Trustees of the SNSNAI.
5. On 21 May 1991, in order to perpetuate themselves in office, the
Unilongo group established the Sto. Nio de Cul de Sac Homeowners Association,
Inc. (CDSHA) and registered it with the Home Insurance Guarantee Corporation
(HIGC).
6. On 27 June 1991, the CDSHA filed a complaint for injunction and
damages with the HIGC against the Dio group. The case was docketed as HIGC
Case No. 155.
7. On 25 October 1992, elections were conducted for the 1992-1993
SNSNAI Board of Trustees. The Dio group was re-elected as members of the
Board of Trustees.
8. Thereafter the CDSHA filed a "Motion to Cite for Contempt (private
respondents) and To Annul Elections of 25 October 1992" in HIGC Case No. 155.
9. By forming a separate and distinct corporation (CDSHA) the Unilongo
group is "unlawfully, maliciously, unwarrantedly and capriciously, whimsically and
oppressively, holding and exercising in bad faith and under unlawful pretenses,
and ultimately performing the functions of the offices and/or positions of PRIVATE
PETITIONERS [private respondents] in their capacities as duly and legally elected
members of the BOARD OF TRUSTEES and OFFICERS of the Sto. Nio de Cul de
Sac Neighborhood Association, Inc. (for short, "SNSNAI") in their individual
respective positions, but likewise, in their duplicated-personalized capacities as
OFFICERS and/or Incorporators of the Sto. Nio de Cul de Sac Homeowners'
Association, Inc. (for short, "CDSHA"), performing in their corporate images the
functions of SNSNAI, and therefore, usurping and depriving the named
PETITIONERS [private respondents] and SNSNAI all the rights, offices and
privileges, public image and reputations as a registered non-stock corporation in
the purview of the New Corporation Code of the Philippines, otherwise known as
Batas Pambansa Blg. 68 as to cause irreparable injury and continuing prejudice
to all herein PETITIONERS [private respondents] and SNSNAI in their private and
corporate capacities in law as to further work damage and injustice to public
interest.1cräläwvirtualibräry
Private respondents prayed, among others, for judgment against petitioners:
 1. Declaring the respondents (petitioners) in their individual capacities or in
their corporate positions/offices they presently hold and represent with the STO.
NIO DE CUL DE SAC NEIGHBORHOOD ASSOCIATION, INC. (SNSNAI) not entitled
to such offices and positions and ousting them therefrom;
2. Declaring herein petitioners (private respondents), instead, to be the
legal persons entitled to said offices or positions entitled to hold and exercise the
same, and restoring and/or placing them to the possessions thereof;
3. Declaring the creation and registration of the STO. NIO DE CUL DE SAC
HOMEOWNERS ASSOCIATION, INC. (CDSHA) by respondents (petitioners) under
its Reg. No. 04-1750 with the Home Insurance Guarantee Corporation (HIGC)
null and void being in contravention of law and illegally formed;
4. Dissolving the corporate personality of the CDSHA or its corporate fiction
being a phantom corporation or a "ghost corporation" as it illegally usurps the
corporate functions for which SNSNAI, the mother-corporation was established
under its S.E.C. Reg. No. 165450 and registered originally with the Securities and
Exchange Commission, respondents (petitioners) being incorporators on both
corporations on records;
5. Ordering the respondents to turn over the books, records of assets and
liabilities, and financial book of accounts, including its financial status, fees and
dues collected from the membership from both constituents of SNSNAI and
CDSHA from the years of control and management from the years 1989 to 1992,
inclusive, for accounting purposes and auditing;2cräläwvirtualibräry
In response, two pleadings were filed by petitioners: (1) An Answer with
Counterclaim on 28 December 1992 by Atty. Herminegildo A. Delgado, who
represented all the defendants in the case; and (2) A Motion to Dismiss on 4
January 1993 on grounds of lack of jurisdiction over the subject matter, litis
pendencia and lack of cause of action, by Atty. Jose Gerardo A. Medina without
specifying whom among the defendants he represented.3
On 15 January 1993, the trial court issued an order clarifying that the Motion to
Dismiss would pertain only to the individual petitioners and the Answer to the
petitioner corporation (CDSHA).4
After private respondents completed the presentation of their evidence, Atty.
Delgado, counsel for CDSHA, withdrew from the case. Atty. Medina consequently
replaced him and promptly filed on 10 November 1994 a manifestation 5 adopting
and reiterating the motion to dismiss filed by the individual petitioners.
In their motion to dismiss,6 petitioners contended that:
1. Disputes involving homeowners associations fall under the exclusive
jurisdiction of the Home Insurance Guarantee Corporation (HIGC) as expressly
provided by E.O. Nos. 90 and 535 amending R.A. No. 580;
2. Pending before the HIGC is a case (HIGC Case No. 155) which involves
the same parties and issues and seeks primarily the same reliefs; and
3. The CDSHA is a separate and distinct corporation from the SNSNAI and,
hence, they could not be accused of usurping the functions and operations of the
latter.
On 3 January 1995, the trial court issued an Order denying petitioners' motion to
dismiss, ruling that:
x x x notwithstanding the provision of R.A. 580 as amended, this Court believes
that it can take cognizance of the case to determine who between the two
associations is the proper corporate body to represent the homeowners of Sto.
Nio de Cul de Sac, under the provisions of B.P. 129.7cräläwvirtualibräry
On 12 February 1995, petitioners moved for reconsideration of the aforequoted
order. This, the trial court denied in an Order dated 28 April 1995 on the ground
that "no new issues had been raised to reconsider the Order of January 3,
1995."8
Not satisfied with the trial court's order, petitioners filed a petition
for certiorari and prohibition with the Court of Appeals raising practically the
same issues set forth in their motion to dismiss.
The Court of Appeals dismissed the above petition for lack of merit in its decision
dated 13 October 1995.9 Said court expressed the view that the grounds alleged
in petitioners' motion to dismiss before the trial court did not appear to be
indubitable and, moreover, the trial court's order of denial was merely
interlocutory. Petitioners' motion for reconsideration met the same fate and was
denied by the Court of Appeals in its resolution dated 2 January 1996.10
Hence, the instant petition, with the following assignment of errors:
A. IT BEING ESTABLISHED BY LAW AND JURISPRUDENCE THAT REGULAR
COURTS HAVE NO JURISDICTION OVER INTRA-CORPORATE CONTROVERSIES,
THE COURT A QUO COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO
LACK OF JURISDICTION IN DENYING DUE COURSE TO PETITIONERS' PETITION;
B. THE COURT A QUO COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING
TO LACK OF JURISDICTION CONSIDERING THAT PETITIONERS HAVE CLEARLY
ESTABLISHED THE PROPRIETY OF THE PETITION AND THEIR RIGHT TO THE
INJUNCTIVE RELIEFS PRAYED FOR;
C. PETITIONERS HAVE NO APPEAL OR OTHER PLAIN, SPEEDY, AND ADEQUATE
REMEDY IN THE ORDINARY COURSE OF THE LAW.11cräläwvirtualibräry
The petition is impressed with merit.
SEC. 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:

Petitioners maintain the view that private respondents' complaint primarily

(a) Devices or schemes employed by or any acts, of the board of directors,
concerns matters pertaining to their homeowners association, so that it is the
business associations, its officers or partners, amounting to fraud and
Home Insurance and Guarantee Corporation (HIGC) which has jurisdiction over
misrepresentation which may be detrimental to the interest of the public and/or
the dispute and not the regular courts pursuant to Republic Act No. 580, as
of the stockholder, partners, members of associations or organizations registered
amended by Executive Order Nos. 535 and 90, conferring upon the said
with the Commission.
administrative agency, among others, the power to regulate and supervise the
activities and operations of homeowners associations.
(b) Controversies arising out of intra-corporate or partnership relations, between
and among stockholders, members, or associates; between any or all of them
Private respondents, on the other hand, claim that the regional trial court
and the corporation, partnership or association of which they are stockholders,
properly took cognizance of their quo warranto complaint in accordance with Rule
members or associates, respectively; and between such corporation, partnership
6612 of the Rules of Court and Sec. 21(1) of B.P. No. 129 13 which vests the
or association and the state insofar as it concerns their individual franchise or
regional trial courts with original jurisdiction to issue writs of quo warranto.
right to exist as such entity;

It is a settled rule that jurisdiction over the subject matter is determined by the
(c) Controversies in the election or appointments of directors, trustees, officers or
allegations in the complaint. Jurisdiction cannot be made to depend upon the
managers of such corporations, partnership or associations.
pleas and defenses set up by the defendant in a motion to dismiss or answer
otherwise jurisdiction would become dependent almost entirely upon the
defendant.14 P.D. 902-A, likewise, vests in the SEC absolute jurisdiction, supervision and
control over all corporations, partnerships or associations, to wit:
In their complaint for quo warranto with damages, private respondents (Dio
group) alleged that they were the duly elected trustees and officers of the Sto. SEC. 3. The Commission shall have absolute jurisdiction, supervision and control
Nio de Cul de Sac Neighborhood Association, Inc. (SNSNAI). However, their over all corporations, partnerships of associations, who are the grantees of
offices, powers and functions were usurped by petitioners (Unilongo group), first, primary franchise and/or a license or permit issued by the government to operate
by amending the SNSNAI by-laws and changing the term of office of the Board of in the Philippines; and in the exercise of its authority, it shall have the power to
Trustees and officers from one (1) year to two (2) years and, second, by enlist the aid or support or any and all enforcement agencies of the government,
establishing another association called the Sto. Nio de Cul de Sac Homeowners civil or military.
Association (CDSHA) and registering the same with the HIGC.15
xxx
The reliefs sought by private respondents in its quo warranto complaint may be
summed as follows: 1) The ouster of the Unilongo group from the Board of
SEC. 6. In order to effectively exercise such jurisdiction, the Commission shall
Trustees of the SNSNAI and from holding corporate officers therein and for the
possess the following powers:
declaration of the Dio group as the rightful officers and members of the Board;
and 2) The dissolution of the CDSHA and the declaration of its registration with
the HIGC null and void for being "in contravention of law and illegally formed."16 x x x.

On the basis of the foregoing undisputed facts, the controversy between the i) To suspend, or revoke, after proper notice and hearing, the franchise or
parties is intra-corporate and, therefore, not cognizable by the ordinary courts of certificate of registration of corporations, partnerships or association, upon any of
justice. the grounds provided by law, including the following:

Thus, Section 5 of P.D. 902-A provides: 1. Fraud in procuring its certificate of registration;
2. Serious misrepresentation as to what the corporation can do or is doing to the
great prejudice of or damage to the general public;
3. Refusal to comply or defiance of any lawful order of the Commission
restraining commission of acts which would amount to a grave violation of its
franchise;
4. Continuous inoperation for a period of at least five (5) years;
5. Failure to file by-laws within the required period;
6. Failure to file required reports in appropriate forms as determined by the
Commission within the prescribed period;
x x x.
The authority of the SEC to dissolve a corporation is similarly found in Section
121 of the Corporation Code:
SEC. 121. Involuntary dissolution. - A corporation may be dissolved by the
Securities and Exchange Commission upon filing of a verified complaint and after
proper notice and hearing on the grounds provided by existing laws, rules and
regulations.
In Abejo v. De la Cruz,17 we held:
In this era of clogged court dockets, the need for specialized administrative
boards or commissions with the special knowledge, experience and capability to
hear and determine promptly disputes on technical matters or essentially factual
matters, subject to judicial review in case of grave abuse of discretion, has
become well nigh indispensable. Thus, in 1984, the Court noted that "between
the power lodged in an administrative body and a court, the unmistakable trend
has been to refer it to the former. 'Increasingly, this Court has been committed
to the view that unless the law speaks clearly and unequivocably, the choice
should fall on [an administrative agency.]"' x x x.
The dispute between the contending parties for control of the corporation
manifestly falls within the primary and exclusive jurisdiction of the SEC in whom
the law has reserved such jurisdiction as an administrative agency of special
competence to deal promptly and expeditiously therewith.
As the Court stressed in Union Glass and Container Corporation v. SEC, "This
grant of jurisdiction [in Section 5] must be viewed in the light of the nature and
functions of the SEC under the law. Section 3 of P.D. 902-A confers upon the
latter 'absolute jurisdiction, supervision, and control over all corporations,
partnerships or associations, who are grantees of primary franchise and/or
license or permit issued by the government to operate in the Philippines xxx.' The
principal functions of the SEC is the supervision and control over corporations,
partnerships and associations with the end in view that investment in these
entities may be encouraged and protected, and their activities pursued for the
promotion of economic development."
xxx
The SEC's jurisdiction to decide the issue of which of the contending Board of
Directors of a corporation is legitimate, was affirmed by the Court in Islamic
Directorate of the Phils. v. CA,18 thus:
There can be no question as to the authority of the SEC to pass upon the issue as
to who among the different contending groups is the legitimate Board of Trustees
of the IDP since this is a matter properly falling within the original and exclusive
jurisdiction of the SEC by virtue of Sections 3 and 5(c) of Presidential Decree No.
902-A:
x x x.
If the SEC can declare who is the legitimate IDP Board, then by parity of
reasoning, it can also declare who is not the legitimate IDP Board. This is
precisely what the SEC did in SEC Case No. 4012 when it adjudged the election of
the Carpizo Group to the IDP Board of Trustees to be null and void. By this ruling,
the SEC in effect made the unequivocal finding that the IDP-Carpizo Group is a
bogus Board of Trustees. Consequently, the Carpizo Group is bereft of any
authority whatsoever to bind IDP in any kind of transaction including the sale or
disposition of IDP property.
It can readily be observed that the grounds enumerated in Sec. 2, Rule 66 of the
Rules of Court are similar to those provided in P.D. No. 902-A. Particularly "the
first and fourth grounds are also enumerated under Section 144 of the
Corporation Code; the second and third grounds are also enumerated under Sec.
22 of the Code and Sec. 6(1) subpar. (4) of P.D. 902-A."19 While the regular
courts are granted jurisdiction over involuntary dissolution of corporations
through quo warrantoproceedings, as previously discussed,  P.D. No. 902-A is
explicit in its mandate that in all matters within its jurisdiction, the SEC has
original and exclusive authority. An author's commentary on the point is
instructive:
x x x.
(2) Quo Warranto proceeding.
Presidential Decree 902-A grants exclusive jurisdiction to the SEC over any
controversy between the corporation and the state insofar as it concerns its
individual franchise or right to exist as such entity. However, under the Rules of
Court, quo warranto proceedings questioning the right of the corporation to
continue existing as such is filed by the Solicitor General or fiscal before the
proper Court of First Instance, now the Regional Trial Court. Does Presidential
Decree 902-A replace and repeal the Rules of Court on this matter, thus
depriving the Regional Trial Courts of any jurisdiction in quo
warranto proceedings against corporations? The Corporation Code in providing for
involuntary dissolution in Section 121 mentions only the SEC but not the Regional
Trial Court. Both the Corporation Code and Presidential Decree 912-A have a
clause repealing all laws inconsistent with their respective provisions. Although
Section 121 of the Code is not necessarily inconsistent with the Rules of Court,
since together they can be reasonably interpreted to mean that the SEC and
Regional Trial Court have concurrent jurisdiction over cases of involuntary
dissolution, the language of Presidential Decree 902-A is quite specific when it
grants exclusive jurisdiction to the SEC in questions between the corporation and
the state concerning the corporations individual franchise or right to exist as such
entity.20cräläwvirtualibräry
Furthermore, the intent to remove from the regular courts jurisdiction over
actions against persons who usurp corporate offices and quo warranto actions
against corporations is crystallized in the 1997 Rules of Civil Procedure, as
amended. Section 2, Rule 66 of the old rules is deleted in its entirety, Section 1
(a), Rules 66 of the amended rules no longer contains the phrase or an office in a
corporation created by authority of law found in the old section. Section 1, Rule
66 of the new rules now reads:
RULE 66
QUO WARRANTO
SECTION 1. Action by Government against individuals.-- An action for the
usurpation of a public office, position or franchise may be commenced by a
verified petition brought in the name of the Republic of the Philippines against:
(a) A person who usurps, intrudes into, or unlawfully holds or exercises a public
office, position or franchise;
(b) A public officer who does or suffers an act which, by the provision of law,
constitutes a ground for the forfeiture of his office; or
(c) An association which acts as a corporation within the Philippines without being
legally incorporated or without lawful authority so to act.
Explaining the changes in the aforequoted provision, Justice Jose Y. Feria states:
This rule is now limited to actions of quo warranto against persons who usurp a
public office, position or franchise; public officers who forfeit their office; and
associations which act as corporations without being legally incorporated.
Actions of quo warranto against corporations, or against persons who usurp an
office in a corporation, fall under the jurisdiction of the Securities and Exchange
Commission and are governed by its rules. (PD 902-A as amended).
The petition is now required to be verified.21cräläwvirtualibräry
However, the jurisdiction of the SEC over homeowners associations has been
transferred to the Home Insurance and Guarantee Corporation (HIGC), the new
name given by executive Order No. 90, Section 1(d) to what was formerly the
Home Financing Corporation (HFC) created under R.A. No. 580.
Section 2 of EO No. 535 states:
x x x.
2. In addition to the powers and functions vested under the Financing Act, the
Corporation, shall have among others, the following additional powers:
a) To require submission of and register articles of incorporations of homeowners
associations and issue certificates of incorporation/registration, upon compliance
by the registering associations thereon; maintain a registry thereof; and exercise
all the powers, authorities and responsibilities that are vested on the Securities
and Exchange Commission with respect to home owners association, the
provision of Act 1459, as amended by P.D. 902-A, to the contrary
notwithstanding;
b) To regulate and supervise the activities and operations of all homeowners
association registered in accordance therewith; (Underscoring ours.)
x x x.
Implementing E.O. No. 535, the HIGC issued the Revised Rules of Procedure in
the Hearing of Homeowners Disputes, thus:
Rule II
Disputes Triable by HIGC/ Nature of Proceedings
SECTION 1. Types of Disputes The HIGC or any person, officer, body, board, or
committee duly designated or created by it shall have jurisdiction to hear and
decide cases involving the following:
a) Devices or schemes employed by or any acts of the Board of Directors or
officers of the association amounting to fraud and misrepresentation which may
be detrimental to the interest of the public or of the members of the association
or the association registered with HIGC.
b) Controversies arising out if intracorporate relations between and among
members of the association, between any and/or all of them and the association
of which they are members, and insofar as it concerns its right to exist as a
corporate entity, between the association and the state/general public or other
entity.
c) Controversies in the election, appointment, or selection of directors, officers,
or members of the association, including the regularity thereof and eligibilities of
such directors, officers or members.
d) Suspension or revocation of the certificate of registration of any homeowners
association duly registered by HIGC upon any of the grounds provided by law,
rules and regulations of HIGC, including but not limited to the following:
1. Fraud or misrepresentation in procuring its certificate of registration;
2. Serious misrepresentation as to what the association can do or is doing;
3. Refusal to comply with or defiance of any lawful order of HIGC or its hearing
officers;
4. Misuse of a right, privilege, or franchise conferred upon it by law, or exercise
of a right, privilege, or franchise in contravention of law;
5. Commission or omission of an act which amounts to a surrender of its
corporate rights, privileges, or franchise;
6. Violation of any provision of HIGC rules and regulations and those of the
Corporation Code whenever the same is applicable;
7. Continuous inoperation or inactivity for a period of at least five (5) years; and
8. Failure to file required reports in appropriate forms as determined by HIGC
within the prescribe period.
In sum, the jurisdiction of the SEC over intra-corporate matters concerning
homeowners associations, including their dissolution has now been transferred to
the HIGC.
In this case, the entities involved are homeowners associations. Although the
SNSNAI is registered with the SEC as a non-stock, non-profit corporation, the
purposes22 for which this neighborhood association was established correspond to
the requirements laid down in the HIGC rules:
RULE I
Definition of Terms/Construction of Rules.
SECTION 1. Definition of Terms.- For purposes of these Rules, and as far as
practicable, the following terms shall mean:
x x x.
b) Homeowners Association an association composed of members who are either
present or future homeowners/awardees/occupants of private or government
housing projects, subdivisions or urban estates, organized primarily for the
purpose of facilitating the delivery of adequate housing and related services
designed to improved the quality of life of its members and the
community/subdivision concerned.
Hence, whatever ambiguities may arise regarding jurisdiction over quo
warranto actions against corporations or persons usurping corporate offices are
now clarified and resolved by the 1977 Rules of Civil Procedure. Quo
warranto actions against corporations or persons using corporate offices fall
under the jurisdiction of the SEC, unless otherwise provided for by law, as in the
instant case where the corporate entities involve are homeowners associations, in
which case jurisdiction is lodge with the Home Insurance and Guarantee
Corporation (HIGC).
Finally, private respondents have also raised the issue that petitioners are now
estopped from assailing the jurisdiction of the courts over the intra-corporate
controversy because the trial of the case before the regional trial court was
already half-way through when the latter raised the issue of jurisdiction.
This is not true. Records bear out that the individual petitioners through their
counsel had in fact filed a motion to dismiss in the Regional Trial Court on the
ground, among others, that the regular courts lack jurisdiction over intra-
corporate matters. The trial court, however, did not act on the motion. Instead, it
proceeded to trial. In fact, the allegations in the petition for certiorari and
prohibitions filed by petitioners in the Court of Appeals were substantially a
reiteration of those contained in the said motion to dismiss.
WHEREFORE, premises considered, the petition is GRANTED. The Regional Trial
Court of Makati, Branch 63 is hereby ENJOINED from further proceeding with the
trial in Civil Case No. 92-3431.
SO ORDERED.