Marcopper Mining Corporation v. Solidbank Corporation
REITERATIONFacts
The Antecedents: Petitioner Marcopper Mining Corporation (MMC) obtained foreign currency loans from respondent Solidbank Corporation. Due to a tailings leakage incident and subsequent closure orders from government agencies, MMC failed to ship copper concentrates and consequently defaulted on its loan payments. MMC requested a consolidation of its loans, which resulted in FCDU 96-808 for US$2,000,000.00. Solidbank filed a civil complaint for a sum of money against MMC and its officers, alleging default and seeking attachment of properties. Procedural History: The trial court issued an order for the issuance of a writ of preliminary attachment. MMC filed a motion to dissolve the writ, arguing it had no cause of action and had not committed fraud. The trial court later granted Solidbank's motion for partial summary judgment against MMC, ordering it to pay ₱52,970,756.89 plus attorney's fees. MMC filed a notice of appeal. Subsequently, Solidbank filed a motion for execution pending appeal, which the trial court granted. MMC filed a petition for certiorari and prohibition in the Court of Appeals (CA) assailing the order of execution pending appeal. The CA dismissed MMC's petition, finding it guilty of forum shopping and having a defective certification against forum shopping. The CA also affirmed the trial court's order of execution pending appeal. The Petition: MMC filed a petition for review with the Supreme Court, assailing the CA's rulings on forum shopping, the defective certification, and the affirmation of the trial court's order of execution pending appeal.
Issue(s)
Whether petitioner MMC ceased to be the real party-in-interest due to a Deed of Assignment. Whether petitioner MMC is guilty of forum shopping. Whether the certification against forum shopping was fatally defective. Whether the Regional Trial Court (RTC) committed grave abuse of discretion in granting the motion for execution pending appeal.
Ruling
The Supreme Court GRANTED the petition. The assailed Decision of the Court of Appeals and the RTC's Order of May 7, 1997, along with the Writ of Execution issued by the RTC, were REVERSED AND SET ASIDE.
Ratio Decidendi
On the issue of real party-in-interest: The Court ruled that MMC did not cease to be the real party-in-interest despite executing a Deed of Assignment pendente lite. Under Section 19, Rule 3 of the Rules of Court, the action may be continued by or against the original party unless a substitution is ordered. The party injured by the partial judgment was MMC, and its obligation to Solidbank was not assigned. Therefore, MMC remained the real party-in-interest to assail the execution of the partial judgment. On the issue of forum shopping: The Court disagreed with the CA's finding of forum shopping. The Court distinguished between MMC's appeal by writ of error from the partial judgment and its petition for certiorari and prohibition assailing the interlocutory order of execution pending appeal. The rights asserted, issues raised, and reliefs prayed for in each were different. The petition for certiorari questioned the RTC's alleged grave abuse of discretion in granting execution pending appeal, not the merits of the partial decision itself. The Court cited International School, Inc. of Manila vs. Court of Appeals to support the view that questioning an order granting execution pending appeal is not forum shopping, even if a regular appeal on the merits is also pursued. On the issue of the certification against forum shopping: The Court agreed with the CA that the certification was defective because it was executed by counsel, not by the party-pleader or a duly authorized officer, as required by Section 5, Rule 7 of the 1997 Rules of Civil Procedure. However, the Court invoked its power to suspend its own rules in the interest of justice, citing Uy vs. Bank of the Philippine Islands, and opted to resolve the petition on its merits due to the apparent merits of the case. On the issue of grave abuse of discretion in granting execution pending appeal: The Court found that the RTC committed grave abuse of discretion. The Court reiterated that execution pending appeal is an extraordinary remedy requiring "good reason" beyond the mere posting of a bond. The RTC cannot preempt the appellate court's determination of the merits of the appeal by finding that no genuine issues were raised. The Court emphasized that the mere posting of a bond does not constitute a "good reason." The reasons cited by the CA, which were not cited by the RTC, were also found to be unsubstantiated by evidence presented in the trial court. Therefore, the RTC's order and the CA's affirmation were nullities.
Main Doctrine
Execution pending appeal is an extraordinary remedy and requires a "good reason" beyond the mere posting of a bond. The trial court cannot preempt the appellate court's determination of the merits of an appeal by ordering execution pending appeal based on its own finding that no genuine issues were raised. Furthermore, the filing of a petition for certiorari assailing an interlocutory order is not forum shopping if it raises distinct issues from a regular appeal on the merits.