Romualdez v. Court of Appeals
REITERATIONFacts
The Antecedents: First Philippine Holdings Corporation (FPHC) was the original owner of 6,299,177 shares in the Philippine Commercial and Industrial Bank (PCIB). FPHC sold these shares to Trans Middle East (Phils.) Equities, Inc. (TMEE) and its incorporator, Edilberto S. Narciso, Jr. Subsequently, the Presidential Commission on Good Government (PCGG) sequestered these shares, deeming them ill-gotten wealth of Benjamin "Koko" Romualdez, husband of petitioner Juliette Gomez Romualdez. The PCGG filed a complaint for reconveyance and other reliefs against Benjamin and Juliette. FPHC sought to intervene, praying for the annulment of the sale and the return of the shares, alleging they were sold without real consideration by Benjamin's dummy board to TMEE and Narciso, who were also Benjamin's dummies. The Sandiganbayan dismissed the complaint due to prescription, a ruling affirmed by the Supreme Court. FPHC filed a second complaint-in-intervention, which was also dismissed for being similar to the first. During the pendency of FPHC's petition for review of this dismissal, FPHC filed a petition to perpetuate Juliette's testimony. Procedural History: FPHC filed a petition before the Regional Trial Court (RTC) of Makati City to perpetuate the testimony of Juliette Gomez Romualdez, citing her advanced age and alleged personal knowledge of the acquisition of the PCIB shares. The RTC granted the petition, finding good reason due to Juliette's age and the lack of objection from the PCGG. Juliette's motion for reconsideration was denied. She appealed to the Court of Appeals (CA). While the appeal was pending, FPHC moved for execution pending appeal, which the CA granted, ordering the issuance of a writ of execution. Juliette moved for reconsideration and to stay the writ, but the CA denied these motions. Subsequently, the CA rendered a decision affirming the RTC's twin orders granting the petition to perpetuate testimony. Juliette appealed this decision to the Supreme Court. Separately, Juliette had also filed a petition for certiorari with the CA seeking to nullify the CA's resolution allowing execution pending appeal. The CA denied this petition, leading to the instant petition before the Supreme Court. The two petitions were consolidated. The Petition: In G.R. No. 230391, petitioner Juliette Gomez Romualdez filed a Petition for Certiorari under Rule 65, assailing the CA's resolutions that allowed execution pending appeal of the RTC's orders granting the perpetuation of her testimony. She argued that the CA gravely abused its discretion in allowing execution pending appeal, as there were no superior circumstances demanding urgency and the underlying claims of FPHC had been repeatedly dismissed on grounds of prescription. In G.R. No. 250746, filed under Rule 45, petitioner sought to reverse the CA's decision affirming the RTC's grant of the petition to perpetuate her testimony. She contended that the RTC lacked jurisdiction, arguing that the petition should have been filed before the Sandiganbayan, which had primary jurisdiction over the related ill-gotten wealth case. Furthermore, she argued that FPHC's petition lacked basis, as she had no personal knowledge of the acquisition of the PCIB shares, and the shares were no longer part of the ill-gotten wealth case due to its dismissal against TMEE. The Supreme Court consolidated both petitions.
Issue(s)
Whether the Court of Appeals committed grave abuse of discretion in allowing execution pending appeal of the RTC's Orders granting the petition to perpetuate the testimony of petitioner. Whether the RTC lacks jurisdiction to take cognizance and dispose of FPHC's petition for perpetuation of testimony. Whether FPHC's petition to perpetuate the testimony of petitioner has basis.
Ruling
The Supreme Court granted both petitions. The Resolutions dated 20 September 2016 and 27 February 2017 of the Court of Appeals in CA-G.R. CV No. 105836 were annulled and set aside. The Decision dated 04 September 2019 and Resolution dated 04 December 2019 of the Court of Appeals in the same case were reversed and set aside. Consequently, the Order dated 27 April 2015 and Omnibus Order dated 21 September 2015 of the RTC, Branch 137, Makati City, in Spec. Pro. Case No. M-7588, were vacated and set aside. The Petition for perpetuation of testimony of petitioner Juliette Gomez Romualdez was denied.
Ratio Decidendi
On the CA's grave abuse of discretion in allowing execution pending appeal: The Court found that the CA committed grave abuse of discretion in ordering execution pending appeal. While execution pending appeal is an extraordinary remedy requiring good reasons, the CA's reliance solely on the petitioner's advanced age and frail physical condition was a myopic reading of the facts. The CA failed to consider that FPHC's complaints-in-intervention had been dismissed twice on grounds of prescription, and that this Court had already affirmed the dismissal of FPHC's first complaint-in-intervention. These facts indicated a lack of a strong cause of action, which should have prompted the CA to pause and assess the merits of FPHC's motion more thoroughly. The Court emphasized that good reasons for execution pending appeal must constitute superior circumstances demanding urgency that outweigh potential injury, which was not sufficiently demonstrated here. The precipitate ruling of the CA could have unduly prejudiced the petitioner, especially since the PCIB shares were no longer part of the relevant case before the Sandiganbayan due to the dismissal of the complaint against TMEE. On the RTC's jurisdiction over the petition: The Court held that even assuming the RTC had jurisdiction, the CA erred in affirming the RTC's ruling to allow the perpetuation of testimony because the petition was utterly devoid of merit. The petitioner argued that the Sandiganbayan, not the RTC, had jurisdiction, as the testimony was intended for Civil Case No. 0035 pending before the Sandiganbayan. However, the Court focused on the lack of basis for the petition itself. The Court noted that the PCIB shares were registered in the name of TMEE, not Benjamin Romualdez or the petitioner. FPHC failed to allege ultimate facts demonstrating the petitioner's personal knowledge and participation in the acquisition of these shares, beyond her relationship as Benjamin's widow. Such a petition, without proof of actual knowledge or participation, would delve into privileged marital communications, which is proscribed under the marital privilege rule. On the basis of FPHC's petition to perpetuate testimony: The Court found that FPHC's petition lacked basis. The Court reiterated its findings in previous cases that Benjamin Romualdez had no association with the PCIB shares, as the acquisition funds came from PCIB and Philippine Commercial Capital, Inc., not from Benjamin. The Court also noted that TMEE was not listed as part of Benjamin's properties. Therefore, FPHC's claim that the shares were ill-gotten wealth of Benjamin was without factual basis. The petition was characterized as a "fishing expedition" to find a friendly court to entertain its narrative, despite the fact that the PCIB shares were no longer part of Civil Case No. 0035 and FPHC's cause of action to assail the validity of the sale had long prescribed.
Main Doctrine
The Court of Appeals committed grave abuse of discretion in ordering execution pending appeal of the Regional Trial Court's orders granting a petition for perpetuation of testimony, as the reasons cited (advanced age and frail physical condition) were not sufficient to outweigh the potential prejudice to the petitioner, especially considering the questionable basis of the underlying cause of action. Furthermore, a petition for perpetuation of testimony lacks basis if it fails to allege ultimate facts demonstrating the petitioner's personal knowledge and participation in the matters sought to be testified upon, and if the underlying cause of action has already prescribed or is otherwise without merit.