Go v. Villanueva
REITERATIONFacts
The Antecedents: Respondent Multi-Luck Corporation (Multi-Luck) filed a collection suit against Alberto T. Looyuko (Looyuko) as sole proprietor of Noah’s Ark Merchandising Inc. (NAMI) for three dishonored checks totaling ₱8,985,440.00. The Bacolod RTC rendered a decision in favor of Multi-Luck, which became final and executory. A writ of execution was issued, leading to the scheduling of auction sales for a house and lot registered in Looyuko's name and a share in a golf club registered in NAMI's name. Procedural History: Petitioner Jimmy T. Go filed a complaint for injunction with a prayer for TRO/preliminary injunction before the Pasig RTC, claiming he was a business partner and co-owner of the properties subject to auction, and that he was not impleaded in the collection suit. The Pasig RTC granted a TRO, then issued a writ of preliminary injunction, and denied respondents' motion to dismiss. Multi-Luck elevated the case to the Court of Appeals (CA). The Petition: The CA reversed the Pasig RTC's rulings, holding that the Pasig RTC gravely abused its discretion by interfering with the judgment of a co-equal court and that petitioner lacked a clear legal right. The CA denied petitioner's motion for reconsideration. Hence, the present petition for review on certiorari before the Supreme Court.
Issue(s)
Whether the Pasig RTC committed grave abuse of discretion in issuing a writ of preliminary injunction that interfered with the execution proceedings of the Bacolod RTC. Whether petitioner, as a claimed co-owner and business partner, has a clear legal right to prevent the execution sale of properties registered in Looyuko's and NAMI's names, considering the authenticity of the partnership agreements and the operation of NAMI as a single proprietorship. Whether the annotation of an adverse claim on the property is sufficient to establish a right to prevent execution, and whether petitioner has standing to question the judgment as a stranger to the collection case.
Ruling
The petition is denied. The assailed Decision and Resolution of the Court of Appeals are affirmed.
Ratio Decidendi
On the issue of interference with co-equal courts: The Supreme Court reiterated the doctrine that no court has the power to interfere by injunction with the judgments or orders of another court of concurrent jurisdiction. The Bacolod RTC, having acquired jurisdiction over the collection suit and rendered judgment, retained jurisdiction over its judgment and all incidents relative to its execution, including the conduct of ministerial officers like sheriffs. Therefore, the issuance of a preliminary injunction by the Pasig RTC was a clear act of interference with the judgment of the Bacolod RTC. The Court emphasized that cases where an execution order has been issued are still considered pending, and all proceedings on execution are part of the original suit. Any questions regarding the subject matter or execution should be threshed out by the court that rendered the judgment. On the petitioner's claimed right as a co-owner: The Court found no basis for petitioner's claim of undue prejudice as a co-owner. To be entitled to a preliminary injunction, the applicant must show a clear and unmistakable right to be protected, a violation of that right, and an urgent necessity for the writ to prevent serious damage. Petitioner's claim was based on agreements dated February 9, 1982, and October 10, 1986, which purportedly established a partnership and co-ownership. However, the authenticity and due execution of these documents were under litigation in other proceedings, with Looyuko claiming forgery. Furthermore, Noah's Ark Merchandising (NAMI) had been operating for over two decades as a registered single proprietorship under Looyuko's name. The CA correctly observed that for all legal intents and purposes and in terms of binding effect against third persons, NAMI was a single proprietorship. Third persons dealing with the business had the right to rely on Looyuko as the registered single proprietor, who could be held personally liable for the proprietorship's liabilities. The Court found it unlikely that petitioner, if a genuine partner, would have allowed the business to operate as a single proprietorship for so long without compelling Looyuko to register it as a partnership. On the effect of the adverse claim: The Court clarified that the annotation of petitioner's adverse claim on the property covered by TCT No. 126519 was not notice to third parties that he was a co-owner, but merely that he claimed to be one and intended to file an action to confirm his right. Under Section 70 of P.D. 1529, the adverse claim was effective only for thirty days from registration, and it did not appear that petitioner filed an appropriate action within that period. Therefore, Looyuko and/or NAMI remained the sole owners of the subject properties at the time the Bacolod RTC ordered their sale on execution. The Court concluded that petitioner had no standing to question the judgment as he was a stranger to the collection case and had no clear right or interest in the attached property. Even if he were a co-owner, the obligations incurred by the business in its operation would be his obligation as a part-owner, and he was essentially trying to forestall the implementation of a final judgment against the corporation he purportedly co-owned.
Main Doctrine
A court cannot interfere by injunction with the judgments or orders of another court of concurrent jurisdiction. A third-party claimant must establish a clear legal right to the property subject of execution, and the annotation of an adverse claim does not, by itself, confer ownership or a right to prevent execution.