Tan v. Bausch & Lomb
REITERATIONFacts
1. The Antecedents: The petitioners, Andrea Tan, Clarita Llamas, Victor Espina, and Luisa Espina, doing business as Best Buy Mart, Inc., were charged with violating Article 189 of the Revised Penal Code for distributing and selling counterfeit RAY BAN sunglasses. The information alleged that they conspired to sell these counterfeit goods, which bore the appearance and trademark of RAY BAN, thereby misleading the public and prejudicing BAUSCH AND LOMB, INC., the exclusive owner of the trademark. 2. Procedural History: The criminal case was initially filed before Branch 21 of the Regional Trial Court (RTC) in Cebu City. The respondent, BAUSCH AND LOMB, INC., moved for the transfer of the case to Branch 9, RTC, Cebu City, designated as a special court for intellectual property rights violations under Administrative Order No. 113-95. The petitioners, however, filed a motion to quash the information, arguing that the penalty for the offense fell within the jurisdiction of the Metropolitan Trial Court in Cities (MTCC), not the RTC. The RTC, in an order dated December 22, 1998, denied the motion to transfer and granted the motion to quash, dismissing the case. The respondent filed a petition for certiorari with the Court of Appeals, which, despite procedural lapses including a late filing, set aside the RTC's order and directed the transfer of the case to Branch 9, RTC, Cebu City. 3. The Petition: The petitioners seek review of the Court of Appeals' decision, arguing that the appellate court erred in giving due course to the respondent's petition for certiorari, citing the respondent's failure to file a motion for reconsideration and the late filing of the petition. They also contend that the Court of Appeals erred in reversing the trial court's ruling that the RTC lacked jurisdiction over the offense of unfair competition under Article 189 of the Revised Penal Code. The petitioners argue that administrative orders cannot override statutory provisions on jurisdiction and that the penalty prescribed for the offense places it within the jurisdiction of lower courts.
Issue(s)
Whether the Court of Appeals erred in giving due course to the petition for certiorari despite procedural infirmities, including the late filing. Whether the Regional Trial Court has jurisdiction over the offense of unfair competition under Article 189 of the Revised Penal Code.
Ruling
The Supreme Court affirmed the Court of Appeals' decision with modification, ordering the transfer of the criminal case to Branch 11, RTC, Cebu City, which is the designated special commercial court for intellectual property rights.
Ratio Decidendi
On the first issue (CA's due course to certiorari petition): The Court held that the acceptance of a petition for certiorari and the grant of due course are generally within the sound discretion of the court. Procedural rules, being technical, may be relaxed in exceptional situations to prevent a miscarriage of justice. The Court found that the procedural lapses of the respondent, including the late filing of the petition for certiorari, could be excused on the basis of equity and to afford the respondent the chance to prove the merits of its complaint. Furthermore, the trial court's order was considered a patent nullity, which is one of the exceptions allowing certiorari even without a prior motion for reconsideration. The Court cited Yao v. Court of Appeals to emphasize that procedural rules should be liberally construed in the interest of substantial justice, especially when the merit of a party's cause is apparent and outweighs non-compliance with formal requirements. On the second issue (RTC's jurisdiction over unfair competition): The Court ruled that the RTC has jurisdiction over violations of intellectual property rights, including unfair competition under Article 189 of the Revised Penal Code. This jurisdiction was transferred from the Municipal Trial Courts (MTC) and Municipal Trial Courts in Cities (MTCC) to the RTC by virtue of Batas Pambansa Blg. 129. The Supreme Court, in the exercise of its constitutional rule-making power, issued Administrative Orders (A.O. No. 113-95 and A.O. No. 104-96) designating specific RTC branches as special courts to handle these cases for the speedy and efficient administration of justice. These administrative orders have the force and effect of law. The trial court, as a subordinate court, should have followed the mandate of A.O. No. 104-96, which vested jurisdiction over the case on the RTC. The Court further held that the trial court committed grave abuse of discretion by allowing a collateral attack on the validity of these administrative orders, as the constitutionality or validity of laws and rules with the force of law cannot be attacked collaterally. The order of the trial court was thus considered a patent nullity.
Main Doctrine
Administrative Orders issued by the Supreme Court pursuant to its rule-making power, designating special courts for intellectual property rights, have the force and effect of law and must be followed by subordinate courts. A subordinate court commits grave abuse of discretion when it refuses to follow such administrative orders and allows a collateral attack on their validity.