BDO Leasing & Finance, Inc. v. Great Domestic Insurance Company of the Philippines, Inc.
REITERATIONFacts
The Antecedents: Respondents spouses Kiddy Lim Chao and Emily Rose Go Ko obtained loans from petitioner BDO Leasing & Finance, Inc. (formerly PCI Leasing and Finance, Inc.) totaling P9,188,570.00, secured by a chattel mortgage on 40 motor vehicles and personal properties. The spouses defaulted on their payments starting August 1999, leading to an outstanding balance of P10,565,165.70 as of January 2000. Petitioner BDO filed a complaint for recovery of possession of personal property with an application for a writ of replevin. Procedural History: The Regional Trial Court (RTC) of Cebu City issued a writ of replevin, which was met with a counter-replevin bond posted by respondent Great Domestic Insurance Company of the Philippines, Inc. The RTC subsequently declared the spouses in default and, in a decision dated October 18, 2004, ordered the spouses to deliver the mortgaged properties or pay the outstanding amount. This decision was affirmed by the Court of Appeals (CA) and subsequently by the Supreme Court (SC) in G.R. No. 178005, which attained finality on February 4, 2008. A writ of execution was issued but remained unsatisfied. Petitioner BDO then moved to serve the writ on the counter-bond, which the RTC initially granted but later limited respondent Great Domestic's liability to P5,000,000.00, citing Section 20, Rule 57 of the Rules of Court and the lack of proven damages. The Petition: Petitioner BDO filed a Petition for Certiorari under Rule 65 of the Rules of Court before the CA Special 18th Division, assailing the RTC's order limiting the counter-bond liability. The CA dismissed the petition outright, citing petitioner BDO's failure to certify against forum shopping due to an undisclosed related case (Civil Case No. CEB-24675), the failure to attach vital pleadings and documents, and the alleged lack of legal capacity to sue due to a change in corporate name from PCI Leasing and Finance, Inc. to BDO Leasing and Finance, Inc. The instant Petition for Review on Certiorari under Rule 45 seeks to reverse these CA resolutions and have the case remanded for a decision on the merits.
Issue(s)
Whether the failure to disclose Civil Case No. CEB-24675 in the Verification/Certification accompanying the Certiorari Petition warrants its outright dismissal. Whether the change of name of petitioner BDO from PCI Leasing and Finance, Inc. to BDO Leasing and Finance, Inc. affected its legal capacity to sue and the authority of its authorized signatory. Whether the Certiorari Petition can be dismissed outright due to the failure of petitioner BDO to attach certain documents which are not specifically required by the Rules of Court.
Ruling
The Supreme Court granted the petition, reversed and set aside the Resolutions of the Court of Appeals, and remanded the case back to the Court of Appeals for decision on the merits.
Ratio Decidendi
On the failure to disclose Civil Case No. CEB-24675 in the Verification/Certification: The Court ruled that the CA Special 18th Division erred in dismissing the petition on this ground. While it was undisputed that petitioner BDO failed to disclose the status of Civil Case No. CEB-24675, the Court emphasized that this case and the certiorari petition involved completely different issues. Civil Case No. CEB-24675 concerned the validity of the chattel mortgage, while the certiorari petition focused on the execution upon the counter-bond. The Court noted that the CA Special 20th Division had previously held there was an "absence of identity of causes of action and reliefs being sought" between these cases. Citing jurisprudence, the Court stated that an omission in the certificate of non-forum shopping about an event that would not constitute res judicata and litis pendencia is not fatal if the evils sought to be prevented by the certification are not present. On petitioner BDO's change of name: The Court found the CA Special 18th Division's position incorrect. The Court reiterated its established ruling that a change in corporate name does not create a new corporation or affect the identity, property, rights, or liabilities of the existing corporation. It is the same corporation with a different name, and its character remains unchanged. Therefore, the Board Resolution and Special Power of Attorney authorizing the signatory, Vicente C. Rallos, to file the petition, issued under the former name "PCI Leasing and Finance, Inc.," retained their binding effect despite the subsequent change of name to "BDO Leasing and Finance, Inc." On the failure to attach pertinent records: The Court held that the CA Special 18th Division erred in dismissing the petition for failure to attach copies of the Complaint, writ of replevin, and writ of execution. While Section 1, Rule 65 requires the attachment of relevant and pertinent pleadings and documents, the Court clarified that not all documents are required. The test of relevancy is whether the document supports the material allegations and makes out a prima facie case of grave abuse of discretion. The Court found that the omitted documents were not essential to establish a prima facie case of grave abuse of discretion concerning the RTC's Order limiting the counter-bond liability. Furthermore, the Court noted that relevant portions of these documents were already summarized or detailed in other pleadings and decisions already part of the records, including the CA's Decision in CA-G.R. CV No. 00551.
Main Doctrine
A change in corporate name does not affect the identity, property, rights, or liabilities of the corporation, and thus does not invalidate prior corporate authorizations. Furthermore, the omission of a related pending case in the certification against forum shopping is not fatal if the cases involve distinct issues and the evils sought to be prevented by the certification are not present. Lastly, the failure to attach all pertinent documents to a petition for certiorari is not a ground for outright dismissal if the essential documents supporting the material allegations are present or summarized elsewhere.