Calleja v. Panday
REITERATIONFacts
The Antecedents: Respondents alleged that from 1985 until May 2005, they were members of the board of directors and officers of St. John Hospital, Incorporated. In May 2005, petitioners, who are also incorporators and stockholders, allegedly usurped the powers and positions belonging to the respondents with the aid of armed individuals. Procedural History: Respondents filed a petition for quo warranto with damages and injunction against petitioners before the Regional Trial Court of San Jose, Camarines Sur, Branch 58 (RTC-Br. 58). RTC-Br. 58 initially ordered the transfer of the case to the Regional Trial Court in Naga City due to improper venue, but the Executive Judge of RTC, Naga City, refused to accept it. RTC-Br. 58 then proceeded to issue summons. Petitioners filed their Answer, raising affirmative defenses of improper venue, lack of jurisdiction, and wrong remedy. On July 13, 2005, RTC-Br. 58 issued an Order denying the motion to dismiss and remanding the case to RTC Branch 23, Naga City, designated as a special court for intra-corporate controversies, while stating that the issue of quo warranto as a proper remedy was for the competent court to decide. The Petition: Petitioners filed a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure, assailing the July 13, 2005 Order of RTC-Br. 58. They questioned whether a court without jurisdiction could remand a case to a co-equal court to cure defects and whether Administrative Circular No. 8-01 could be applied to a case filed in May 2005. The Supreme Court noted that while a Rule 45 petition was an inappropriate remedy for an interlocutory order, it would treat the petition as a special civil action for certiorari in the interest of resolving the jurisdictional issue and preventing further violence between the parties. The Court ultimately found that RTC-Br. 58 lacked jurisdiction over the intra-corporate dispute and ordered the dismissal of the quo warranto petition.
Issue(s)
Whether a Regional Trial Court branch without jurisdiction to try a case has the authority to remand it to another co-equal court to cure defects in venue and jurisdiction. Whether Administrative Circular No. 08-01, effective March 1, 2001, may be applied to a case filed on May 16, 2005, and the determination of proper venue for intra-corporate controversies.
Ruling
The Supreme Court granted the petition, set aside the assailed Order of the Regional Trial Court of San Jose, Camarines Sur dated July 13, 2005, and ordered the dismissal of the petition for quo warranto.
Ratio Decidendi
On the issue of jurisdiction and the authority to remand: The Court held that the Regional Trial Court of San Jose, Camarines Sur, Branch 58 (RTC-Br. 58) was bereft of jurisdiction over the respondents' petition for quo warranto. The allegations in the petition clearly indicated an intra-corporate controversy, which, after the enactment of Republic Act No. 8799 (RA 8799), falls under the jurisdiction of designated Special Commercial Courts. RTC-Br. 58 was not designated as such a court. Therefore, it lacked the requisite authority to order the transfer or remand of the case to another branch of the Regional Trial Court. The only action RTC-Br. 58 could have taken was to dismiss the petition for lack of jurisdiction. The Court cited HLC Construction and Development Corp. v. Emily Homes Subdivision Homeowners’ Association to support the principle that a trial court with no jurisdiction over the subject matter must dismiss the complaint. On the applicability of Administrative Circular No. 08-01 and the proper venue: The Court clarified that while RA 8799 transferred jurisdiction over cases formerly cognizable by the Securities and Exchange Commission (SEC) to courts of general jurisdiction, specific Supreme Court issuances designated certain RTC branches as Special Commercial Courts. A.M. No. 00-11-03-SC (effective December 15, 2000) and A.M. No. 03-03-03-SC (effective July 1, 2003) designated RTC Branch 23 in Naga City as the Special Commercial Court for Camarines Sur. Section 5 of the Interim Rules of Procedure Governing Intra-Corporate Controversies Under RA 8799 mandates that such actions shall be commenced and tried in the RTC having jurisdiction over the principal office of the corporation. Since the principal office of St. John Hospital, Inc. is in Goa, Camarines Sur, the petition should have been filed with the designated Special Commercial Court in Naga City. The filing of the petition with RTC-Br. 58 in San Jose, Camarines Sur, which was not a designated Special Commercial Court, was erroneous. The Court found no cogent reason for the respondents' failure to file the petition in the appropriate court, given that the relevant administrative circulars had been in effect for several years prior to the filing of their petition.
Main Doctrine
A Regional Trial Court branch not designated as a Special Commercial Court lacks jurisdiction over intra-corporate controversies, and its order remanding such a case to a co-equal court is void. Such an order is interlocutory and generally not appealable via Rule 45, but the Supreme Court may treat it as a special civil action for certiorari in exceptional circumstances to prevent perpetuation of error and address violence between parties.