Majestic Plus International, Inc. vs. Bullion Investment and Development Corporation Case Digest

Majestic Plus International, Inc. vs. Bullion Investment and Development Corporation/Majestic Plus International, Inc. Vs. Bullion Investment and Development Corporation, et al.

G.R. No. 201017/G.R. No. 215289. December 5, 2016

Facts

On June 30, 2003, the City of Manila, through then City Mayor Joselito Atienza, and Bullion, represented by its President Roland Lautachang, entered into a Contract for the lease of the said property for a period of twenty-five (25) years. Under the Contract, Bullion, as lessee, agreed to construct two 4-storey buildings, one of which shall be used as an extension office of the Manila City Hall for its institutional services, while the other shall be used for commercial purposes.

Bullion then commenced construction and was able to finish and turn over the City Hall extension building to the Manila City Government. However, Bullion was unable to finish the construction of the commercial building. Bullion then sought the help of and was able to convince petitioner corporation, Majestic Plus Holding International, Incorporation (Majestic), to invest in Bullion's business venture, particularly the completion of the construction of its commercial building which was intended to be used as a mall (Meisic Mall).

On September 7, 2004, Bullion, represented by its President, entered into a Memorandum of Agreement6 (MOA) with Majestic. Following the execution of the MOA, Majestic issued five (5) checks, on various dates, for an aggregate amount of Fifty-Seven Million Pesos (P57 ,000,000.00) in favor of Bullion, as partial payment of the 80% equity interest in the latter. Bullion acknowledged such payment. However, it alleged that an additional four ( 4) checks, representing a total amount of P31,000,000.00, which were subsequently issued by Majestic were dishonored because of "Stop Payment" orders. For Majestic's failure to heed Bullion's demands, the latter sent another letter to the former, dated June 24, 2005, informing it that Bullion had elected to rescind the MOA.

Meanwhile, Majestic took over the supervision and eventually finished the construction of the Meisic Mall, except with respect to some minor installations. Based on the Summary of Payments, Majestic claims that, aside from the P57,000,000.00 it had earlier paid to Bullion, it also incurred expenses for the purpose of sustaining the construction of Meisic Mall and the acquisition of various equipment for use inside the mall in the sum Pl34,522,803.22. Thus, the aggregate amount alleged to have been invested by Majestic is P191,522,803.22.

The Meisic Mall became operational as early as May 2005. Majestic conducted business therein by renting out the mall's leasable spaces to stallholders and by employing personnel for the security, maintenance and upkeep of the mall's premises. However, in the morning of June 25, 2005, respondent, aided by several police personnel and security guards, entered the premises and took physical possession and control of Meisic Mall.

This prompted Majestic to file a Complaint for Specific Performance, Injunction and Damages with a Prayer for Temporary Restraining Order and/or Writ of Preliminary Injunction against Bullion, together with several other persons. Majestic alleged that it has become a majority shareholder of Bullion by reason of its P 191,522,803.22 investment, which comprises 95.76% of the agreed P200,000,000.00 authorized capital stock of Bullion. Majestic also claims that the subject MOA remains valid and binding and that Bullion failed to comply with its unde1iakings thereunder.

The executive judge assigned the same to Branch 46, RTC of Manila which is also a commercial court. The parties did not question the jurisdiction of Branch 46. In the ensuing proceedings before Branch 46, the parties jointly moved that the case be submitted for summary judgment, to which the RTC acceded. On July 28, 2011, Branch 46, RTC of Manila rendered a Decision in favor of the plaintiff Majestic Plus Holding International, Inc. and against the herein defendants.

On August 22, 2011, Majestic filed a Motion for Execution Pending Appeal which was granted by the RTC by vi11ue of a Special Order and two other related orders, all dated September 1, 2011. Consequently, a Writ of Execution Pending Appeal on even date was issued. Per Sheriffs Return dated September 2, 2011, the Writ was served on Bullion and was thereby immediately implemented. In accordance with the Writ, the Sheriff was able to completely and successfully remove the physical possession and control of Meisic Mall from Bullion and deliver the same to Majestic.

Bullion filed a Petition for Certiorari before the CA which granted the aforesaid Petition and annulled and set aside the Special Order and the two (2) other assailed Orders. Hence, this petition.

Issues:

1. Whether Branch 46, RTC of Manila, despite being designated as an SCC, has jurisdiction to hear and decide Majestic's suit for specific performance.
2. Whether RTC was correct in considering the case appropriate for summary judgment.
3. Whether the execution of such Decision pending appeal was proper.

Rulings:

1. Yes. The matter of whether the RTC resolves an issue in the exercise of its general jurisdiction or of its limited jurisdiction as a special court is only a matter of procedure and has nothing to do with the question of jurisdiction.

Moreover, it should be noted that Special Commercial Courts (SCCs) are still considered courts of general jurisdiction. Section 5.2 of R.A. No. 8799, otherwise known as The Securities Regulation Code, directs merely the Supreme Court's designation of RTC branches that shall exercise jurisdiction over intra-corporate disputes. The assignment of intra-corporate disputes to secs is only for the purpose of streamlining the workload of the RTCs so that certain branches thereof like the SCCs can focus only on a particular subject matter.

Nothing in the language of the law suggests the diminution of jurisdiction of those RTCs to be designated as SCCs. The RTC exercising jurisdiction over an intra-corporate dispute can be likened to an RTC exercising its probate jurisdiction or sitting as a special agrarian court. The designation of the SCCs as such has not in any way limited their jurisdiction to hear and decide cases of all nature, whether civil, criminal or special proceedings.

Hence, based on the foregoing, it is clear that Branch 46, RTC of Manila, despite being designated as an SCC, has jurisdiction to hear and decide Majestic's suit for specific performance.

2. No. Summary judgment is a procedural device resorted to in order to avoid long drawn out litigations and useless delays. Relief by summary judgment is intended to expedite or promptly dispose of cases where the facts appear undisputed and certain from the pleadings, depositions, admissions and affidavits. Summary judgments are proper when, upon motion of the plaintiff or the defendant, the court finds that the answer filed by the defendant does not tender a genuine issue as to any material fact and that one party is entitled to a judgment as a matter of law. But if there be a doubt as to such facts and there be an issue or issues of fact joined by the parties, neither one of them can pray for a summary judgment. Where the facts pleaded by the parties are disputed or contested, proceedings for a summary judgment cannot take the place of a trial.

In the present case, it is true that both parties moved for the rendition of a summary judgment. However, it is apparent that the RTC did not comply with the procedural guidelines when it ordered that the case be submitted for summary judgment without first conducting a hearing to determine if there are indeed no genuine issues of fact that would necessitate trial. The trial court merely required the parties to submit their respective memoranda, together with their affidavits and exhibits and, although the parties presented opposing claims, the RTC hastily rendered a summary judgment. Thus, the trial court erred in cursorily issuing the said judgment.

A careful examination of the pleadings will show that Majestic's causes of action in its Complaint are anchored on Bullion's supposed violations of the provision of the subject MOA. On the other hand, Majestic's allegations are controverted by Bullion who, in a like manner, asserts that by virtue of Majestic's failure to comply with the provisions of the said MOA, it decided to rescind the same. These diametrically opposed and conflicting claims present a factual dispute which can be resolved and settled only by means of evidence presented during trial. On the basis of the foregoing, it is clear that the RTC erred in rendering its assailed summary judgment. Thus, the CA did not commit error in setting aside the said summary judgment.

3. No. In view of this Court's affirmance of the CA ruling which reversed and set aside the July 28, 2011 Decision of the RTC, there is no longer any RTC judgment that may be executed. Hence, the issue as to whether or not there are "good reasons" to execute the assailed Decision of the RTC has become moot and academic.

WHEREFORE, the instant petitions are DENIED. The November 2, 2011 Decision and March 14, 2012 Resolution of the Court of Appeals in CA-G.R. SP No. 121072 are AFFIRMED. The October 23, 2013 Decision and November 4, 2014 Resolution of the Court of Appeals in CA-G.R. CV No. 97537 are, likewise, AFFIRMED. The Executive Judge of the Regional Trial Court of Manila is hereby ORDERED to PROMPTLY RE-RAFFLE the case among the non-commercial courts with a directive that the same be resolved with deliberate dispatch.