Baluyot v. Ty
REITERATIONFacts
The Antecedents: N. M. Baluyot & Co. (petitioner) and Union Textile Corporation (UTC) entered into an agreement for UTC to manufacture and deliver textile products to petitioner for one year. As the agreement neared expiration, UTC invited proposals for renewal. Petitioner also submitted an offer for a sole buyership agreement, which UTC's Board of Directors accepted. The execution of this contract was prevented when Antonio Ty filed Civil Case No. 73189 with the Court of First Instance (CFI) of Manila, Branch II, presided over by Judge Jose Leuterio. Upon Ty's petition, Judge Leuterio issued an order restraining UTC from entering into any sole buyership contract with parties other than Ty and from selling/delivering textile goods to anyone but Ty. Petitioner intervened in this case and opposed the injunction. Despite Ty presenting no evidence and petitioner submitting documentary evidence showing doubt in Ty's cause of action, Judge Leuterio issued a preliminary injunction upon a P30,000 bond, preventing the consummation of the sole buyership award to petitioner. Procedural History: Petitioner filed a petition for certiorari, prohibition, and mandamus with the Court of Appeals (CA) against Judge Leuterio and Ty (CA-G.R. No. 41449-R). The CA issued a restraining order against enforcing Judge Leuterio's order, which was later confirmed by a preliminary injunction. Subsequently, Ty filed another action, Civil Case No. 73530, against UTC with the CFI of Manila, Branch XV, presided over by respondent Judge Felix Domingo. This new complaint, for specific performance and damages, alleged short deliveries by UTC and sought an injunction restraining UTC from selling to third parties. Judge Domingo issued a restraining order on July 9, 1968, preventing UTC from selling its present and future stocks to third parties other than Ty until contractual obligations were met. Petitioner intervened and opposed the injunction. The hearing for the preliminary injunction in Civil Case No. 73530 was repeatedly postponed upon Ty's motions, over petitioner's objections, and eventually reset for October 7, 1968. Before this date, Ty again moved for postponement, and Judge Domingo granted it, setting the hearing for the preliminary injunction simultaneously with the trial on the merits, thereby indefinitely maintaining the injurious effects of the restraining order issued without bond. The Petition: Petitioner filed the present verified petition for certiorari, prohibition, and/or mandamus, alleging arbitrariness and grave abuse of discretion on the part of respondent Judge Domingo. Petitioner argued that the restraining order, issued without bond, circumvented the CA's preliminary injunction, that the repeated postponements were intended to delay resolution and prolong the prejudicial effects of the order, and that setting the injunction hearing with the trial on the merits would indefinitely enforce the restraining order.
Issue(s)
Whether the respondent judge committed grave abuse of discretion in issuing a restraining order without bond, repeatedly postponing hearings, and setting the injunction hearing simultaneously with the trial on the merits, thereby indefinitely maintaining the injurious effects of the restraining order. Whether the Supreme Court has original jurisdiction to entertain petitions for certiorari, prohibition, and mandamus in aid of the appellate jurisdiction of the Court of Appeals.
Ruling
The Supreme Court dismissed the petition for certiorari, prohibition, and mandamus filed by N. M. Baluyot & Co. without prejudice to the filing of a corresponding petition with the Court of Appeals.
Ratio Decidendi
On the issue of grave abuse of discretion: The Court found that the facts alleged in the petition clearly showed arbitrariness and grave abuse of discretion on the part of the respondent judge. The restraining order was issued without bond, which had the effect of circumventing and nullifying the preliminary injunction previously issued by the Court of Appeals in a related case involving the same parties and subject matter. Furthermore, the repeated and unjustified postponements of the hearing on the petition for a writ of preliminary injunction were clearly intended to delay a definitive resolution, thereby allowing the prejudicial effects of the restraining order to continue indefinitely. The setting of the hearing on the petition for preliminary injunction simultaneously with the trial on the merits, a proceeding expected to be long and protracted, would result in the continued enforcement of the restraining order for an indefinite period, contrary to the usual practice of issuing such orders for a short and definite duration. On the jurisdiction of the Supreme Court: The Court acknowledged that under the amendments to Section 29 of the Judiciary Act of 1948, the writs of certiorari, prohibition, and mandamus prayed for were in aid of the appellate jurisdiction of the Court of Appeals over the main case pending before the respondent judge. The Court also affirmed its original jurisdiction to entertain such special civil actions, citing the case of Breslin, et al. vs. Luzon Stevedoring Company, et al., which held that the Court of Appeals' original jurisdiction to issue these writs in aid of its appellate jurisdiction is not exclusive. However, the Court reiterated its policy to require that petitions similar to the one under consideration should be filed with the Court of Appeals, with the Supreme Court reserving its power to review whatever final judgments or orders are rendered by the latter.
Main Doctrine
The Supreme Court dismissed a petition for certiorari, prohibition, and mandamus filed by N. M. Baluyot & Co. against respondent judge and Antonio Ty, holding that while the Court has original jurisdiction to entertain such actions, the policy is to require petitions of this nature to be filed with the Court of Appeals, reserving to the Supreme Court the power to review the latter's final judgments or orders.