Petition For Certiorari

Section 1. Petition for certiorari.
When any tribunal, board or officer

exercising judicial or quasi-judicial
functions has acted without or in
excess of its or his jurisdiction, or
with grave abuse of discretion
amounting to lack or excess of
jurisdiction, and there is no appeal,
or any plain, speedy, and adequate
remedy in the ordinary course of law, a
person aggrieved thereby may file a
verified petition in the proper court,
alleging the facts with certainty and
praying that judgment be rendered
annulling or modifying the proceedings
of such tribunal, board or officer, and
granting such incidental reliefs as law
and justice may require.
The petition shall be accompanied by a
certified true copy of the judgment,
order or resolution subject thereof,
copies of all pleadings and documents
relevant and pertinent thereto, and a.
sworn certification of non-forum
shopping as provided in the third
paragraph of section 3, Rule 46

THIS IS A RULE 45 CASE WALANG RULE 65 SO MODIFY NA
LANG,

REPUBLIC OF THE PHILIPPINES
SUPREME COURT
MANILA

Third Division

ADERITO Z. CULLEN,

ADERITO CULLEN, ET AL. V. HON. JUDGE ALEGRE, ET AL.
PETITION FOR CERTIORARI
G.R. NO. 168639
04381.10.004
pds/CULLEN/SC/petition for certiorari
2
BONIFACIO C. CULLEN,
and DOLNEY S. CULLEN,
Petitioners,

- versus - G.R. No. 168639

MAUREEN, CEZAR T. LADY
DEL ROSARIO, JOSE M.
XXXXXX III , CHRISTINA F.
XXXXXX, ANTHONY K. LADY
DEL ROSARIO, SIMPLICIO T.
LADY DEL ROSARIO, JR.,
ERIC C. DOE, RUSTIKOY M.
XXXXXX, and REGIONAL
TRIAL COURT, FIRST
JUDICIAL REGION, BRANCH
48, SAMAR CITY
Respondents.
[CA-G.R. SP No. 87785, Court of
Appeals, Eighth Div.; Civil
(SEC) Case No. U-14 (SCC-
2874), RTC, Samar city, Branch
48]

For: Review on Certiorari, with
temporary restraining order and
preliminary injunction.
x----------------------------------------------------------------------------------------------------x

P E T I T I O N

Petitioners Aderito Z. CULLEN,
1
Bonifacio C. CULLEN
2
and
Dolney S. CULLEN,
3
by counsel, respectfully state:

Introductory

Petitioners are before this Honorable Court to correct a
patent injustice perpetrated by respondent Cezar T. LADY DEL
ROSARIO and his counsel, Atty. JOHN G., who connived with
respondent Judge Meliton G. ALEGRE, pairing judge of the
Regional Trial Court, First Judicial Region, Branch 48 in Samar city,
to remove petitioners as directors of AAACCCBDDDDevelopment
Corporation
4
through a preliminary injunction issued eight months
after petitioners were elected in a valid stockholders meeting. In
his Order dated November 25, 2004 granting the preliminary

1
Hereafter, CULLEN.
2
Hereafter, B. Sumbilla.
3
Hereafter, D. Sumbilla.
4
Hereafter, XXXXX INC.

G.R. NO. 168639
04381.10.004
3
injunction, respondent Judge not only enjoined petitioners from
performing acts as directors and officers of the corporation but also
directed the holding of a special stockholders meeting in
Bayambang, to elect the new directors and officers of the
corporation, effectively disposing of the merits of the case ahead of
trial.

Respondent Judge facilitated the removal of petitioners from
office by acting on Mr. LADY DEL ROSARIOs election protest,
which was filed beyond the statutory period to contest the election.
He issued a temporary restraining order ex parte, in violation of
circulars of this Honorable Court and applicable decisions, and set
the hearings on the preliminary injunction on short notice so as to
prevent the petitioners and their counsel from participating in the
proceeding. Despite objections to his impartiality and to his
jurisdiction, respondent Judge proceeded and allowed himself to be
used as an instrument of injustice.

This case illustrates how legal knowledge may be abused by
litigants to mislead the courts and to frustrate justice. Thus, Mr.
LADY DEL ROSARIO and his counsel took full advantage of the
articles of incorporation of ABC INCORPORATED, which states
the principal office of the corporation in Bayambang, BULACAN,
to file their action in Samar city despite the fact that the corporation
never operated in that far-flung municipality nor held any
meetings there. The distance of Samar city from Metro Manila,
where petitioners and private respondents as well as their counsel
reside and hold office, require at least six hours of travel by private
transportation, thereby rendering it impracticable for petitioners to
prove their defenses in a timely manner. At every opportunity, Mr.
LADY DEL ROSARIO and Atty. ABUGADO invoked the summary
nature of the Interim Rules of Procedure on Intra-Corporate
Controversy to penalize petitioners.

G.R. NO. 168639
04381.10.004
4
This Honorable Court has recently held that the peoples
confidence in the judicial system is founded not only on the
magnitude of legal knowledge and the diligence of the members of
the bench, but also on the highest standard of integrity and moral
uprightness they are expected to possess.
5
To be sure, this
Honorable Court as the staunch guardian of the citizens righs
and welfare - cannot and will not sanction an injustice so patent on
its face, and allow itself to be an instrument in the perpetration
thereof.
6

Petitioners, by filing this appeal, seek to correct the patent
injustice they suffered at the hands of Mr. LADY DEL ROSARIO,
his counsel, respondent Judge, and only recently the Court of
Appeals. They invoke the inherent power of this Honorable Court
not only to pronounce what the law is in adjudicating every
dispute but, more importantly, to level the playing field by
rendering substantial justice to petitioners cause.

P a r t i e s

Petitioners CULLEN, B. CULLEN and D. CULLEN are all of
legal age. Mr. CULLEN is the President and Chairman of the Board
of Directors of ABC INCORPORATED, a domestic corporation with
principal office at the 24
th
Floor, One Magnificent Mile-Babuun INC
Building, San Miguel Avenue, Ortigas Center, Pasig City, while B.
CULLEN is ABC INCORPORATEDs Treasurer. Petitioners are all
stockholders of ABC INCORPORATED. They may be served with
notices and other processes of this Honorable Court through
undersigned counsel.

5
Yu vs. Leanda, 349 SCRA 58, 64-65 (2001).
6
EPG Construction Co. vs. Vigilar, 354 SCRA 566, 576 (2001).

G.R. NO. 168639
04381.10.004
5
Respondent Meliton G. ALEGRE is the pairing Judge and
presiding Judge of the Regional Trial Court, Samar city, Branches 48
and 47, respectively. He may be served with notices and other
processes of this Honorable Court at his station at the Regional Trial
Court, Samar city, Branch 48 located at the Hall of Justice, Samar city,
BULACAN.

Private respondents Cezar T. LADY DEL ROSARIO, Jose M.
XXXXXX III and Christina XXXXXX
7
are all of legal age. They are
impleaded as plaintiffs in Civil (SEC) Case No. U-14 and, hence, as
necessary parties. They may be served with notices and other
processes of this Honorable Court through their counsel of record
below, ABUGADO ABUGADO and XXXXXX Concepcion Law
Offices at Unit 1112, Manila Astral Tower, 1330 Taft Avenue corner
Padre Faura Street, Manila.

Private respondents Anthony K. LADY DEL ROSARIO,
Simplicio T. LADY DEL ROSARIO, Jr., Eric C. DOE, and RUSTIKOY
M. XXXXXX
8
are impleaded as directors and officers unlawfully
elected during the void stockholders meeting of ABC
INCORPORATED subject of this petition. They are impleaded as
necessary parties and may be served with notices through
respondent LADY DEL ROSARIOs counsel, ABUGADO ABUGADO
and XXXXXX Concepcion Law Offices at Unit 1112, Manila Astral
Tower, 1330 Taft Avenue corner Padre Faura Street, Manila.

Respondent Regional Trial Court, First Judicial Region, Branch
48, Samar city is a court created under Batas Pambansa Bldg. 129

7
Hereafter, plaintiffs below.
8
Hereafter, respondent directors and officers.

G.R. NO. 168639
04381.10.004
6
(1981), as amended. It may be notified of the proceedings and served
with processes of this Honorable Court at its official station at the
Hall of Justice, Samar city, BULACAN.

Nature of the Petition

This is a petition under Rule 45 of the 1997 Rules of Civil
Procedure to review by certiorari the Court of Appeals Decision
dated March 31, 2005
9
and Resolution dated June 29, 2005
10
in CA-
G.R. SP No. 87785, entitled Aderito A. CULLEN, et al. vs. Hon. Meliton
G. ALEGRE, et al.

In its Decision, the Court of Appeals denied due course to the
petition therein and erroneously dismissed it on grounds that (a) the
Regional Trial Court, First Judicial Region, Branch 48 in Samar city,
11

had authority to directly call a stockholders meeting of ABC
INCORPORATED; (b) there was a valid notice of the stockholders
meeting as shown by the letter dated December 1, 2004 of private
respondents counsel, which was purportedly received by ABC
INCORPORATEDs Corporate Secretary; and (c) private respondents
did not engage in forum shopping. The appellate court refused to
consider other grounds raised by petitioners.

In its Resolution, the Court of Appeals denied petitioners
motion for reconsideration of the appellate courts Decision.
Petitioners respectfully submit that the Court of Appeals Decision

9
Hereafter, the Decision, a certified true copy of which is attached as Annex A hereof.
10
Hereafter, the Resolution, a certified true copy of which is attached as Annex B hereof.
11
Hereafter, the RTC XXXXXX.

G.R. NO. 168639
04381.10.004
7
and Resolution were rendered in a way not in accord with law and
the applicable decisions of this Honorable Court. Hence, this
petition.

Timeliness of the Petition

On April 11, 2005, petitioners received a copy of the Decision.
They moved to reconsider the same in a Motion for
Reconsideration dated April 26, 2005, which petitioners filed on
even date. However, petitioners motion for reconsideration was
denied by the appellate court in its Resolution, a copy of which they
received on July 8, 2005. Under Rule 45, Section 1 of the Rules,
petitioners had 15 days from July 8, 2005, or until July 23, 2005,
within which to file a petition for review on certiorari with this
Honorable Court.

On July 14, 2005, petitioners filed a Motion for Extension of
Time to File Petition dated July 13, 2005 where they prayed for an
extension of 30 days from July 23, 2005, or until August 22, 2005,
within which to file their petition for review on certiorari with this
Honorable Court.

Statement of Facts and the Case

1. On July 27, 1998, the Securities and Exchange
Commission
12
approved the amendment of ABC INCORPORATEDs
articles of incorporation to authorize the establishment of its
principal office from the 24
th
Floor of the One Magnificent Mile-
Babuun INC Building in Ortigas Center, Pasig City to Bayambang,

12
Hereafter, SEC.

G.R. NO. 168639
04381.10.004
8
BULACAN. The change in the location of ABC INCORPORATEDs
principal office was made at the instance of its then President,
respondent LADY DEL ROSARIO, to make it difficult for any
claimant to sue ABC INCORPORATED and/or respondent LADY
DEL ROSARIO in his hometown of Bayambang, BULACAN, and
not for any bona fide purpose.

2. ABC INCORPORATED never opened an office in
Bayambang, BULACAN, much less conducted any business activity
or transaction in said municipality. Hence, the change in location of
the principal office was never implemented, such that ABC
INCORPORATED continued to hold its principal office on the 24
th

Floor, One Magnificent Mile-Babuun INC Building, San Miguel
Avenue, Ortigas Center, Pasig City.
13
The meetings of the
stockholders and directors of ABC INCORPORATED were held at
the Pasig office.

3. On March 1, 2004, ABC INCORPORATED held its annual
stockholders meeting at the Pasig office, which was attended by all
of its stockholders, in person and by proxy. Notices
14
of the said
meeting were sent to the stockholders by respondent Eric C. DOE,
15

then the Corporate Secretary of ABC INCORPORATED, indicating
that the meeting was to be held at ABC INCORPORATEDs Pasig
office.

4. None of the stockholders, plaintiffs below included,
objected to the venue of the meeting. In fact, respondents LADY DEL
ROSARIO and XXXXXX attended the meeting, during which they

13
Hereafter, Pasig office.
14
A copy of the Notice is attached as Annex C hereof.
15
Hereafter, Atty. Pilapil or respondent Pilapil.

G.R. NO. 168639
04381.10.004
9
were elected as directors. Respondents LADY DEL ROSARIO and
XXXXXX also assented to the election of petitioners CULLEN and B.
CULLEN as ABC INCORPORATEDs Chairman/President and
Treasurer, respectively.
16

5. Since then, ABC INCORPORATEDs business was
transacted through its Board of Directors composed of respondents
LADY DEL ROSARIO and XXXXXX as well as petitioners, without
any protest or objection on the part of plaintiffs below or any other
stockholder of ABC INCORPORATED.
17
Respondents LADY DEL
ROSARIO and XXXXXX, at whose instigation the case a quo was filed,
received per diems from ABC INCORPORATED as duly elected
directors.

6. As the corporate secretary of ABC INCORPORATED,
Atty. DOE kept all the corporate and business records of the
corporation. However, upon his cessation from office on June 21,
2004, Atty. DOE failed and/or refused to turn over the said records
to his successor. Hence, ABC INCORPORATEDs records were lost,
misplaced or incomplete. Furthermore, respondent LADY DEL
ROSARIO unlawfully took ABC INCORPORATEDs stock and
transfer book
18
and refused to deliver it to ABC INCORPORATED or
to its new corporate secretary, Atty. Joselito G. Blando.

7. On June 21, 2004, petitioner CULLEN filed Civil Case No.
70027, entitled Aderito Z. CULLEN vs. United Resources Asset
Management, Inc., Atty. Richard J. Nethercott and Atty. Honorato R.

16
Please see the Minutes of the Organizational Meeting of the Board of Directors on March 1,
2004, a copy of which is attached as Annex D hereof.
17
Please see the Minutes of the Regular Meeting of the Board of Directors on June 14, 2004, a
copy of which is attached as Annex E hereof.
18
Hereafter, STB.

G.R. NO. 168639
04381.10.004
10
Mataban,
19
which was raffled to the Regional Trial Court,
20
Pasig
City, Branch 71.
21

8. In Civil Case No. 70027, petitioner CULLEN sought to (a)
immediately restrain and preliminarily enjoin defendants therein
from proceeding with the auction sale of the ABC
INCORPORATED shares
pledged by petitioners to CCCCC INC; (b) enjoin defendants therein
from [i] executing any certificate of sale of such shares; [ii] recording
such shares in the books of ABC INCORPORATED; [iii] canceling the
pledged shares and issuing new ones in favor of defendants therein
or any bidder; or [iv] exercising any rights of ownership over such
shares; and (c) declare void therein defendants foreclosure of the
pledged shares, any auction sale, certificate of sale, registration of
sale, cancellation of shares, issuance of new shares, transfer or
assignment of new shares and the exercise of any rights of ownership
over such pledged shares.

9. Before the RTC Pasig could issue a temporary restraining
order,
22
Atty. Mataban conducted the auction sale of the pledged
shares in Bayambang, BULACAN, with CCCCC INC being the
highest bidder for said shares. On the same day, before any
certificate of stock could be issued in its name, CCCCC INC sold the
auctioned shares to respondent LADY DEL ROSARIO. On June 30,
2004, the RTC Pasig issued its TRO, stating that:

In the broader interest of justice and so as not to render moot
and academic the issue on the grant or not of the writ, let this
Temporary Restraining Order be issued enjoining defendants, their

19
Hereafter, URAMI, Atty. Nethercott and Atty. Mataban, respectively.
20
Hereafter, RTC.
21
Hereafter, RTC Pasig.
22
Hereafter, TRO.

G.R. NO. 168639
04381.10.004
11
officers, agents and assigns from recording such sale in the books of
ABC INCORPORATED or from canceling the pledged shares and
issuing new ones in favor of defendants or from exercising any
rights of ownership over such shares in violation of plaintiffs
rights. The Corporate Secretary of ABC INCORPORATED is
directed to hold in abeyance the cancellation of the pledged shares
and to restore them, if cancelled, in the books of the corporation
until further orders from this Court.
23

10. On June 30, 2004, upon learning of the issuance of the
TRO, respondent LADY DEL ROSARIO and Atty. Nethercott rushed
to ABC INCORPORATEDs corporate secretary, Atty. Blando, to ask
him to record entries in the STB immediately transferring the
auctioned shares to CCCCC INC and then to transfer them again
from CCCCC INC to respondent LADY DEL ROSARIO. The
pressure exerted upon Atty. Blando was sweetened by payment of
substantial sums of money to Atty. Blando. The cancellation and
transfer of the shares were made in the STB without surrendering it
to ABC INCORPORATED or Atty. Blando, to beat the TRO that by
then had been issued by the RTC Pasig.

11. While unlawfully holding on to the STB, respondent
LADY DEL ROSARIO and Atty. DOE demanded Atty. Blando to
cancel the pledged shares and issue new shares to CCCCC INC and
respondent LADY DEL ROSARIO. Respondent LADY DEL
ROSARIO and Atty. DOE likewise ordered Atty. Blando to perform
the cancellation and issuance of the shares in Atty. DOEs office
inside the Land Transportation Office compound in Quezon City, to
be witnessed by respondent LADY DEL ROSARIO alone.
Respondent LADY DEL ROSARIO and Atty. DOE refused to allow
the recording to be done by Atty. Blando outside of Atty. DOEs
office.

23
A copy of the RTC Pasigs Order dated June 30, 2004 is attached as Annex F hereof.

G.R. NO. 168639
04381.10.004
12

12. After Atty. Blando received the TRO on July 1, 2004 and
tried, but failed, to undo the cancellation and transfer of the shares in
the absence of the STB which was then unlawfully withheld by
respondent LADY DEL ROSARIO, ABC INCORPORATED
authorized the reconstitution of the STB and its entries. The
cancellation and transfer made at the instance of LADY DEL
ROSARIO were then reversed by ABC INCORPORATED in the
reconstituted STB to comply with the TRO.

13. In the meantime, on July 19, 2004, the RTC Pasig issued a
writ of preliminary injunction
24
against CCCCC INC and Attys.
Nethercott and Mataban, as well as all persons acting under them,
stating that:

IT IS HEREBY ORDERED by the undersigned Judge of this
Court, that until further orders, you, the said defendants United
Resources Asset Management, Inc. (CCCCC INC for short), Atty.
Richard J. Nethercott, and Atty. Honorato R. Mataban, and all
persons acting under them, to desist and refrain from further
proceeding with the public auction sale of the pledged shares of
stocks by registering/recording the sold shares of stocks in the
books of ABC INCORPORATED, or canceling them and issuing
new ones in favor of defendant CCCCC INC to enable it to exercise
the rights of ownership over said shares owned by plaintiff in
violation of the latters rights.

SO ORDERED.

14. Thereafter, respondent LADY DEL ROSARIO refused to
comply with the subpoena issued by the RTC Pasig to produce the
STB in Civil Case No. 70027. He also rejected the demand of
petitioner CULLENs counsel to surrender the STB within 24 hours,
on the ground that the STBs possession was being litigated in that action:

24
A copy of the RTC Pasigs Writ of Preliminary Injunction is attached as Annex G hereof.

G.R. NO. 168639
04381.10.004
13
As you are aware, the matter of possession of ABC
INCORPORATEDs Stock and Transfer Book is currently being
litigated in Civil Case No. 70027, entitled Aderito Z. CULLEN vs.
United Resources Asset Management, Inc., Et Al., pending before the
Regional Trial Court of Pasig City (Branch 71), where I am
represented by Tan Acut & Lopez Law Offices, my counsel de
parte.
25

15. Respondent LADY DEL ROSARIO, by way of special
appearance, then participated in Civil Case No. 70027 by filing
motions and pleadings, examining witnesses, presenting evidence,
and otherwise actively prosecuting and defending his claims therein
as if he were a party in that case.
26

16. On August 16, 2004, plaintiffs below filed an election
protest before the RTC, San Carlos City, to (a) invalidate the March 1,
2004 election of ABC INCORPORATEDs directors and officers; and
(b) enjoin petitioners from discharging their functions as directors
and officers of ABC INCORPORATED. The case a quo was initially
docketed as Civil Case No. SCC 2874 entitled Cezar T. LADY DEL
ROSARIO, et al. vs. ABC INCORPORATED, et al., and was raffled to
Branch 56 of the said court.
27

17. Plaintiffs below thereafter filed an Amended Complaint
dated September 2, 2004, further praying the RTC San Carlos to issue
a TRO and/or writ of preliminary injunction based on the same facts
alleged in their original complaint.

25
A copy of respondent Quiambaos letter dated September 6, 2004 is attached as Annex H
hereof.
26
A sample pleading filed by respondent Quiambao in Civil Case No. 70027 is attached as Annex
I hereof.
27
Hereafter, RTC San Carlos.

G.R. NO. 168639
04381.10.004
14
18. On September 22, 2004, plaintiffs below filed their first
Supplemental Complaint dated September 16, 2004
28
before the RTC
San Carlos, praying the court a quo to (a) direct Export Industry Bank,
respondent LADY DEL ROSARIO and petitioner B. CULLEN to
surrender to the custody of the court a quo the original and
reconstituted STB and other relevant certified true copies of ABC
INCORPORATEDs corporate documents; and (b) nullify the
reconstituted STB and the reconveyance effected therein. However,
the RTC San Carlos did not issue a TRO in favor of plaintiffs.

19. Subsequently, SUPER LAND CORPCorporation,
29

through (a) Melvin Nazareno, as President of CAKELAND
Infrastructure Development Corporation;
30
and (b) petitioner
CULLEN, as Chairman and President of ABC INCORPORATED,
with CAKELAND Infrastructure and ABC INCORPORATED being
the owners of a majority of the shares of stock of CAKELAND
Tollways, issued a notice of the Annual Stockholders Meeting of
SUPER LAND CORPdated September 30, 2004, to be held on October
20, 2004, at 11:00 a.m. Said notice was duly served on and received
by respondent LADY DEL ROSARIO.

20. Then, in an Order dated October 4, 2004, the RTC San
Carlos suddenly ordered the case transferred to the RTC, Samar city
pursuant to Supreme Court Administrative Circular No. 08-2001,
without the approval of the Executive Judge of the RTC, San Carlos
City, and without prior leave of the Supreme Court. As a result, the
case a quo was transferred to the RTC XXXXXX, which was then
vacant, where it was docketed anew as Civil (SEC) Case No. U-14.

28
A copy of the Supplemental Complaint dated September 16, 2004 is attached as Annex J
hereof.
29
Hereafter, CAKELAND Tollways.
30
Hereafter, CAKELAND Infrastructure.

G.R. NO. 168639
04381.10.004
15
This was done despite the fact that none of the parties to the case
were residents of the city and the municipalities over which RTC
XXXXXX exercised its territorial jurisdiction. Respondent Judge then
acted on the case as a pairing judge of the RTC XXXXXX.

21. In a Second Supplemental Complaint dated October 6,
2004, plaintiffs below prayed for reliefs similar to those sought in
their Complaint, Amended Complaint and Supplemental Complaint.
In an Order dated October 12, 2004, respondent Judge motu proprio
admitted the two supplemental complaints filed by plaintiffs below.

22. On Monday, October 18, 2004, respondent Judge issued
ex parte a TRO effective for a period of 72 hours, enjoining petitioners
from acting as officers of ABC INCORPORATED and/or from
committing further acts inimical to the interests of ABC
INCORPORATED and its stockholders, and directing respondent
LADY DEL ROSARIO and petitioners to bring to RTC XXXXXX the
original as well as the reconstituted STB of ABC INCORPORATED.
31

The trial court then set the summary hearing of LADY DEL
ROSARIOs application for TRO on October 20, 2004, which was a
Wednesday. Considering the distance between Metro Manila, where
petitioners and their counsel reside and held office, and the RTC
XXXXXX, it was physically impossible for petitioners to prepare for
and attend the hearing in a timely manner.

23. Thus, on October 20, 2004, petitioners filed a Motion to
Inhibit and to Quash Temporary Restraining Order dated October
19, 2004 before the RTC XXXXXX. Petitioners likewise moved to
defer the hearing scheduled on October 20, 2004 because of the long

31
A copy of the RTC XXXXXXs Temporary Restraining Order dated October 18, 2004 is attached
as Annex K to K-1 hereof.

G.R. NO. 168639
04381.10.004
16
distance required and the short notice for petitioners to prepare for
the hearing. However, respondent Judge refused to defer the hearing.
He proceeded with the hearing and received ex parte the testimonies
of respondents LADY DEL ROSARIO and Jose M. XXXXXX III as
well as Atty. DOE. Thereafter, plaintiffs below submitted their
application for a TRO to respondent Judge, in the absence of
petitioners and their counsel who were unable to attend the hearing.

24. On October 29, 2004, respondent Judge issued an order
holding in abeyance plaintiffs application for a TRO, pending the
exchange of pleadings by the parties. Hence, on November 2, 2004,
petitioners filed their Answer with Counterclaim dated October 28,
2004.
32
In the meantime, on November 2, 2004, Hon. Aurelio R. Ralar
assumed his offices as presiding judge of RTC XXXXXX, thereby
divesting respondent Judge of further authority to act on Civil (SEC)
Case No. U-14.

25. On November 9, 2004, petitioners received a copy of
plaintiffs Manifestation with Motion for Early Resolution dated
November 2, 2004, praying for the resolution of their application for
preliminary injunction before the RTC XXXXXX. On the date their
pleading was written, plaintiffs below were apparently aware of the
appointment of Judge Ralar as presiding judge of the RTC XXXXXX.

26. In an Order dated November 10, 2004, respondent Judge
set the reception of petitioners evidence, as defendants below, on
Thursday, November 19, 2004 at 2:00 p.m., oblivious of the fact that
Judge Ralar had assumed his office as presiding judge of the RTC
XXXXXX. Petitioners, through undersigned counsel, received a

32
A copy of petitioners Answer with Counterclaim dated October 28, 2004 is attached as
Annex L hereof.

G.R. NO. 168639
04381.10.004
17
copy of the order on Tuesday, November 17, 2004, at 2:24 p.m.
However, as none of the lawyers handling the case for petitioners
was available to go to Samar city on short notice, petitioners again
were not represented during the hearing. Upon LADY DEL
ROSARIOs motion, petitioners were deemed to have waived their
right to present evidence and the application for preliminary
injunction was ordered submitted for resolution.
33

27. On November 19, 2004, petitioners received a copy of
plaintiffs Answer to Counterclaim dated November 10, 2004.
Unknown to petitioners, on November 25, 2004, respondent Judge
had issued an Order granting plaintiffs application for preliminary
injunction and ordering the holding of a special stockholders
meeting in Bayambang, BULACAN on December 10, 2004, which
Order practically disposed of the merits of the case. The dispositive
portion of the Order read:

WHEREFORE, premises considered, let the Writ of
Preliminary Injunction issue, upon posting of the requisite bond in
the amount if Five Hundred Thousand Pesos (P500,000.00) to
answer for whatever damages that the defendants would suffer on
account of the issuance of the injunction writ, restraining
defendants from acting as officers of the corporation and
committing further acts inimical to the corporation.

It is likewise ordered that a special stockholders meeting in the
principal office of the corporation in Bayambang, BULACAN on
December 10, 2004 be held. The Branch Clerk of this Court shall
attend the said meeting to observe the proceedings and report his
observations to this court. For this purpose, the defendant
Bonifacio CULLEN is ordered to surrender to the court, not later
than December 3, 2004 the duplicate key given to him by Export
Industry Bank, Shaw Blvd., Pasig City, of the safety deposit box
where he and plaintiff Cezar T. LADY DEL ROSARIO deposited
the Original Stock and Transfer Book of ABC INCORPORATED
which shall be the basis in the determination of the corporate
stockholding during the meeting scheduled on the above-
mentioned dated.

33
A copy of the RTC XXXXXXs Order dated November 19, 2004 is attached as Annex M
hereof.

G.R. NO. 168639
04381.10.004
18

SO ORDERED.
34

28. On December 6, 2004, petitioner B. CULLEN received by
registered mail a copy of an undated Notice of Special Annual
Stockholders Meeting,
35
issued by the Branch Clerk of Court of
respondent Judge, informing B. CULLEN that pursuant to the Order
dated November 25, 2004, a special annual stockholders meeting of
ABC INCORPORATED would be held four days later on December
10, 2004, 9:00 a.m., at ABC INCORPORATEDs supposed office in
Poblacion Sur, Bayambang, BULACAN. By this time, petitioners had
not been notified of respondent Judges invalid Order dated
November 25, 2004.

29. On December 8, 2004, before petitioners received a copy
of the Order dated November 25, 2004, respondent LADY DEL
ROSARIO, together with the Sheriff of the RTC XXXXXX, caused the
opening of the safety deposit box in Export Industry Bank, Pasig City
branch, on the basis of the Order, even if the bank was well outside
the territorial jurisdiction of the RTC XXXXXX. Petitioners were not
notified by the Export Industry Bank before it allowed the opening of
the safety deposit box. Upon the opening of the safety deposit box,
respondent LADY DEL ROSARIO took custody of ABC
INCORPORATEDs STB, which he placed there for safekeeping in his
and B. CULLENs names instead of turning it over to ABC
INCORPORATED or to Atty. Blando.

30. On December 10, 2004, petitioners were compelled to file
before the RTC XXXXXX an Urgent Motion to Set Aside Notice of

34
A copy of the RTC XXXXXXs Order dated November 25, 2004 is attached as Annex N hereof.
35
Hereafter, Notice.

G.R. NO. 168639
04381.10.004
19
Stockholders Meeting dated December 9, 2004.
36
Despite
petitioners motion, however, the RTC XXXXXX refused to act on the
motion and plaintiffs below proceeded to hold an invalid
stockholders meeting of ABC INCORPORATED in Bayambang,
BULACAN on December 10, 2004, on the basis of the unlawful
Notice issued by the Branch Clerk of Court of respondent Judge.
During this invalid meeting, which was presided by the Branch Clerk
of Court of respondent Judge, the following respondents elected
themselves as directors and officers of the corporation:

Directors:

Cezar T. LADY DEL ROSARIO
Anthony K. LADY DEL ROSARIO
Simplicio T. LADY DEL ROSARIO, Jr.

Corporate Officers:

Cezar T. LADY DEL ROSARIO - Chairman and
President
Anthony K. LADY DEL ROSARIO - Treasurer
Eric C. DOE - Corporate Secretary
RUSTIKOY M. XXXXXX - Assistant Corp. Sec.
37

31. Petitioners immediately filed on December 10, 2004, a
petition for certiorari
38
before the Court of Appeals and applied for a
TRO and/or a writ of preliminary injunction to enjoin plaintiffs
below from further implementing the Order dated November 25,
2004 and/or causing grave and irreparable damage to petitioners.
The petition was docketed as CA-G.R. SP No. 87785 and assigned to
Associate Justice Mariano C. del Castillo of the then Ninth Division of
the appellate court.

36
A copy of the Urgent Motion to Set Aside Notice of Stockholders Meeting dated December 9,
2004 is attached as Annex O hereof.
37
Copies of the Certification dated December 10, 2004 issued by the secretary of the invalid
stockholders meeting of XXXXX INC, Jeffrey P. Punzalan, and the Notice of even date issued by
the alleged Assistant Corporate Secretary of XXXXX INC, Albert M. Rasalan, are attached as
Annexes P and Q hereof, respectively.
38
A copy of the Petition dated December 10, 2004, without the voluminous annexes, is attached
as Annex R hereof.

G.R. NO. 168639
04381.10.004
20

32. In a belated Resolution dated December 17, 2004, a copy
of which petitioners received only on December 28, 2004, eighteen days
after the invalid stockholders meeting, the Court of Appeals directed
plaintiffs below to file their comment on the Petition within 10 days
from notice, without necessarily giving due course to the instant
petition for certiorari with prayer for the issuance of temporary
restraining order and/or writ of preliminary injunction.

33. On December 29, 2004, petitioners, citing grave and
irreparable injury to themselves and to third parties dealing with
plaintiffs below, filed a Motion for Partial Reconsideration dated
December 28, 2004
39
of the Court of Appeals Resolution dated
December 17, 2004 insofar as it did not address petitioners
application for a TRO. Thereafter, private respondents therein filed
(a) a Comment on the Petition dated January 6, 2005; and (b) an
Opposition to Motion for Partial Reconsideration dated January 7,
2005.
40

34. On January 14, 2005, petitioners again filed with the
Court of Appeals an Urgent Ex-Parte Motion for Temporary
Restraining Order and/or Writ of Preliminary Injunction dated
January 14, 2005 in CA-G.R. SP No. 87785, to which private
respondents therein filed an Opposition To Urgent Ex-Parte Motion
for Temporary Restraining Order and/or Writ of Preliminary
Injunction dated January 21, 2005.
41

39
A copy of the Motion for Partial Reconsideration dated December 28, 2004 is attached as
Annex S hereof.
40
Copies of the Comment on the Petition dated January 6, 2005 and Opposition to Motion for
Partial Reconsideration dated January 7, 2005 are attached as Annexes T and U hereof,
respectively.
41
Copies of the Urgent Ex-Parte Motion for Temporary Restraining Order and/or Writ of
Preliminary Injunction dated January 14, 2005 and Opposition To Urgent Ex-Parte Motion for

G.R. NO. 168639
04381.10.004
21

35. In a Resolution dated January 27, 2005, a copy of which
petitioners received on February 1, 2005, the Court of Appeals (a)
deferred action on petitioners Motion for Partial Reconsideration,
which it ruled to resolve simultaneously with the main case; and (b)
directed the parties to file their respective memoranda. The Court of
Appeals did not act on petitioners Urgent Ex-Parte Motion for TRO
and Preliminary Injunction.

36. After the parties filed their respective memoranda, the
Court of Appeals issued the assailed Decision denying due course to
the petition. On April 26, 2005, petitioners filed a Motion for
Reconsideration dated April 26, 2005.
42
On July 8, 2005, petitioners

received a copy of the Court of Appeals Resolution denying their
motion for reconsideration of the appellate courts Decision.

37. Thus, on July 14, 2005, petitioners filed with this
Honorable Court a Motion for Extension of Time to File Petition
dated July 13, 2005 where they prayed for an extension of 30 days
from July 23, 2005, or until August 22, 2005, to file their petition for
review on certiorari with this Honorable Court.

Hence, this petition.

Grounds for the Petition

Temporary Restraining Order and/or Writ of Preliminary Injunction dated January 21, 2005 are
attached as Annexes V and W hereof, respectively.
42
A copy of the Motion for Reconsideration dated April 26, 2005 is attached as Annex X
hereof.

G.R. NO. 168639
04381.10.004
22
Petitioners respectfully submit that the Court of Appeals
Decision and Resolution are void and should be set aside for having
been rendered contrary to law, procedural rules and applicable
decisions of this Honorable Court, in that:

I. THE APPELLATE COURT ERRED IN RULING
THAT THE RTC XXXXXX HAD AUTHORITY TO
DIRECTLY CALL A STOCKHOLDERS MEETING.

II. THE APPELLATE COURT ERRED IN RULING
THAT THERE WAS A VALID NOTICE OF THE
PURPORTED STOCKHOLDERS MEETING HELD
ON DECEMBER 10, 2004.

III. THE APPELLATE COURT ERRED IN RULING
THAT PLAINTIFFS BELOW WERE NOT GUILTY
OF FORUM SHOPPING.

IV. THE APPELLATE COURT ERRED IN RULING
THAT PLAINTIFFS BELOW WERE NOT
ESTOPPED FROM QUESTIONING ABC
INCORPORATEDS STOCKHOLDERS MEETING
AND ELECTION OF OFFICERS HELD ON
MARCH 1, 2004.

V. THE APPELLATE COURT ERRED IN RULING
THAT NO GRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK OR EXCESS OF
JURISDICTION COULD BE IMPUTED TO
RESPONDENT JUDGE IN ISSUING THE ORDER
DATED NOVEMBER 25, 2004.

VI. HON. MARIANO C. DEL CASTILLO IS
DISQUALIFIED FROM ACTING IN CA-G.R. SP
NO. 87785.

A r g u m e n t s

Respondent Judge did not have
authority to act in Civil (SEC) Case

G.R. NO. 168639
04381.10.004
23
No. U-14 upon the appointment of the
regular Presiding Judge.

38. The Order dated November 25, 2004 was issued by
respondent Judge, in his capacity as pairing judge of RTC XXXXXX,
after the regular presiding Judge, Hon. Ralar, was appointed and
assumed office on November 2, 2004. Pursuant to Supreme Court
Circular No. 19-98, respondent Judge, as pairing judge of RTC
XXXXXX, was only authorized to take cognizance of all the cases
thereat as acting judge therein until the appointment and assumption to
duty of the regular judge. Thus, after the appointment and assumption
into office of the regular Judge of RTC XXXXXX, respondent Judge
ceased to have any authority to issue the appealed Order.
Consequently, all Orders of respondent Judge issued from November
2, 2004, including the questioned Order dated November 25, 2004, are
void.

RTC XXXXXX did not have the
authority to order the holding of a
stockholders meeting.

39. Under Section 5 of the Securities Regulation Code,
43
only
the SEC has the authority to compel officers of any registered
corporation to call a stockholders meeting:

Powers and Functions of the Commission. --- 5.1 The
Commission shall act with transparency and shall have the powers
and functions provided by this Code, Presidential Decree No. 902-
A, the Corporation Code, the Investment Houses Law, the
Financing Company Act and other existing laws. Pursuant thereto
the Commission shall have, among others, the following powers
and functions:
. . .

43
Republic Act No. 8799 (2000).

G.R. NO. 168639
04381.10.004
24
(k) Compel the officer of any registered corporation or
association to call meetings of stockholders or members thereof
under its supervision;
. . .

40. Furthermore, the functions that were transferred from the
SEC to the regular courts are limited to those enumerated under
Section 5 of Presidential Decree
44
No. 902-A (1976), as amended. This
enumeration does not include the power to compel the holding of a
stockholders meeting. Section 5.2 of the Securities Regulation Code
limited the transfer only to those functions defined under Section 5 of
P.D. 902-A, to wit:

5.2. The Commissions jurisdiction over all cases
enumerated under Section 5 of Presidential Decree No. 902-A is
hereby transferred to the Courts of general jurisdiction or the
appropriate Regional Trial Court: Provided, That the Supreme
Court in the exercise of its authority may designate the Regional
Trial Court branches that shall exercise jurisdiction over these
cases. The Commission shall retain jurisdiction over pending cases
involving intra-corporate disputes submitted for final resolution
which should be resolved within one (1) year from the enactment of
this Code. The Commission shall retain jurisdiction over pending
suspension of payments/rehabilitation cases filed as of 30 June
2000 until finally disposed.
45

41. On the other hand, Section 5 of P.D. No. 902-A states:

SECTION 5. In addition to the regulatory and adjudicative
functions of the Securities and Exchange Commission over
corporations, partnerships and other forms of associations
registered with it as expressly granted under existing laws and
decrees, it shall have original and exclusive jurisdiction to hear and
decide cases involving:

(a) Devices or schemes employed by or any acts, of the
board of directors, business associates, its officers or partnership,
amounting to fraud and misrepresentation which may be
detrimental to the interest of the public and/or of the stockholder,
partners, members of associations or organizations registered with
the Commission;

44
Hereafter, P.D.
45
Emphasis supplied.

G.R. NO. 168639
04381.10.004
25

(b) Controversies arising out of intra-corporate or
partnership relations, between and among stockholders, members,
or associates; between any or all of them and the corporation,
partnership or association of which they are stockholders, members
or associates, respectively; and between such corporation,
partnership or association and the state insofar as it concerns their
individual franchise or right to exist as such entity;

(c) Controversies in the election or appointments of
directors, trustees, officers or managers of such corporations,
partnerships or associations.

(d) Petitions of corporations, partnerships or associations
to be declared in the state of suspension of payments in cases
where the corporation, partnership or association possesses
sufficient property to cover all its debts but foresees the
impossibility of meeting them when they respectively fall due or in
cases where the corporation, partnership or association has no
sufficient assets to cover its liabilities, but is under the management
of a Rehabilitation Receiver or Management Committee created
pursuant to this Decree. (As added by PD No. 1758.)

42. Rule 1 of the Interim Rules of Procedure Governing Intra-
Corporate Controversies
46
virtually restates the same enumeration in
Section 5 of P.D. 902-A:

SECTION 1. (a) Cases covered These Rules shall govern
the procedure to be observed in civil cases involving the following:

(1) Devices or schemes employed by, or any act of, the
board of directors, business associates, officers or partners,
amounting to fraud or misrepresentation which may be detrimental
to the interest of the public and/or of the stockholders, partners, or
members of any corporation, partnership, or association;

(2) Controversies arising out of intra-corporate,
partnership, or association relations, between and among
stockholders, members, or associates; and between, any or all of
them and the corporation, partnership, or association of which they
are stockholders, members, or associates, respectively;

(3) Controversies in the election or appointment of
directors, trustees, officers, or managers of corporations,
partnerships, or associations;

(4) Derivative suits; and

46
Hereafter, the Interim Rules.

G.R. NO. 168639
04381.10.004
26

(5) Inspection of corporate books.

43. Clearly, there is nothing in Section 5.2 of the Securities
Regulation Code, in relation to Section 5 of P.D. No. 902-A and Rule 1
of the Interim Rules, which shows that the regular courts were given
the authority under the law to directly call a stockholders meeting of
the corporation. Had the legislature intended to give the courts the
power to compel the officers of a corporation to call a special meeting
under Section 5.2 of the Securities Regulation Code, then it would
have not given the SEC the same power under Section 5.1 of the
statute. To be sure, the legislature could not have intended to give the
SEC and the regular courts concurrent jurisdiction that could result in
conflicting orders.

44. Moreover, as clearly stated in Section 5.1 of the Securities
Regulation Code, while the SEC has the authority to compel the
officers of the corporation to call a stockholders meeting under its
supervision, it cannot, by itself, call such a meeting. In other words,
the sending of notices, the conduct of the meeting, the recording of
the minutes, and the resolution of any issues concerning quorum,
proxies, and other related actions, are left to the officers of the
corporation. However, respondent Judge, in issuing the Order dated
November 25, 2004, not only usurped the power of the SEC but itself
called the special meeting of the stockholders on December 10, 2004,
contrary to the clear language of Section 5.1 of the Securities
Regulation Code, and without any legal authority to do so.

The notice of the special stockholders
meeting issued by the Branch Clerk of
Court was not valid.

G.R. NO. 168639
04381.10.004
27

45. In view of the foregoing provisions of the Securities
Regulation Code, P.D. No. 902-A and the Interim Rules, the notice of
special annual stockholders meeting issued by the Branch Clerk of
RTC XXXXXX is void for having no basis in law. In the first place, the
Branch Clerk of Court of RTC XXXXXX should not have been
ordered by the respondent Judge to oversee the special meeting of a
private corporation as this was not a function germane to his office as
a judicial officer. In Republic vs. Sandiganbayan,
47
this Honorable Court
discussed the rationale why clerks of court should be prohibited from
supervising or controlling the special meetings of private
corporations:

The Clerk of Court, who is already saddled with judicial
responsibilities, need not be burdened with the additional duties of
a corporate secretary. Moreover, the Clerk of Court may not have
the requisite knowledge and expertise to discharge the functions of
a corporate secretary.
. . .

The appointment of a sitting member of the Sandiganbayan
is particularly unsound for, as the PCGG points out:

. . . . What then is the reason for him to attend and supervise the
meeting? To observe so that he can later testify in the court where
he himself sits in the court which will eventually decide any
controversy which may arise from the meeting?

Obviously, under such situation, the justice so appointed
would be compelled to inhibit himself from any judicial
controversy arising from the stockholders meeting. Worse, if he
were to preside at the meeting and rule upon the objections that
may be raised by some stockholders, the Sandiganbayan would be
faced with the "anomaly" of eventually reviewing the decisions
rendered by a member of its court during the stockholders meeting.

This Court appreciates the quandary that the Sandiganbayan
faced when it ordered its Division Clerk of Court to call the
meeting: ETPI has two sets of officers and, presumably, two
corporate secretaries. And given the stakes involved, the
stockholders meeting would be contentious, to say the least, hence,
the need for an impartial referee to supervise and control the
meeting.

47
402 SCRA 84 (2003).

G.R. NO. 168639
04381.10.004
28

Happily, the case of Board of Directors and Election Committee
of SMB Workers Savings and Loan Asso., Inc. v. Tan, etc., et al.
provides a solution to the Sandiganbayan's dilemma. There, this
Court upheld the creation of a committee empowered to call,
conduct and supervise the election of the board of directors:

As regards the creation of a committee of three vested with
the authority to call, conduct and supervise the election, and the
appointment thereto of Candido C. Viernes as chairman and
representative of the court and one representative each from the
parties, the Court in the exercise of its equity jurisdiction may
appoint such committee, it having been shown that the Election
Committee that conducted the election annulled by the respondent
court if allowed to act as such may jeopardize the rights of the
respondents.

In a proper proceeding a court of equity may direct the
holding of a stockholders' meeting under the control of a special
master, and the action taken at such a meeting will not be set aside
because of a wrongful use of the court's interlocutory decree, where
not brought to the attention of the court prior to the meeting. (18
C.J.S. 1270.)

A court of equity may, on showing of good reason, appoint
a master to conduct and supervise an election of directors when it
appears that a fair election cannot otherwise be had. Such a court
cannot make directions contrary to statute and public policy with
respect to the conduct of such election. (19 C.J.S. 41)

This Court also approved a similar action by the Securities
and Exchange Commission in Sales v. Securities and Exchange
Commission.

Such a committee composed of impartial persons
knowledgeable in corporate proceedings would provide the
needed expertise and objectivity in the calling and the holding of
the meeting without compromising the Sandiganbayan or its
officers. The appointment of the committee members and the
delineation of the scope of the duties of the committee may be
made pursuant to an agreement by the parties or in accordance
with the provisions of Rule 9 (Management Committee) of the
Interim Rules of Procedure for Intra-Corporate Controversies
insofar as they are applicable.
48

46. Assuming arguendo that the RTC XXXXXXs Order dated
November 25, 2004 was valid, the Notice issued by the Branch Clerk
of Court of the RTC XXXXXX was nevertheless defective since (a) the
Branch Clerk of Court did not base the Notice on the STB, which was

48
402 SCRA 84, 112 (2003).

G.R. NO. 168639
04381.10.004
29
not in his possession; and (b) the Notice was sent to petitioners only
on December 6, 2004, or in the same week of the scheduled
stockholders meeting on December 10, 2004. This is in clear violation
of Section 50 of the Corporation Code which partly states:

Special meetings of stockholders or members shall be held at
any time deemed necessary or as provided in the by-laws:
Provided, however, That at least one (1) week written notice shall be sent
to all stockholders or members, unless otherwise provided in the by-
laws.
49

In view thereof, the special stockholders meeting held on
December 10, 2004 was not valid.

The notice of the special stockholders
meeting sent by Atty. JOHN G.
ABUGADO was not a valid notice of
the stockholders meeting on
December 10, 2004.

47. The Court of Appeals erred in finding that the letter
dated December 1, 2004 prepared by Atty. ABUGADO constituted a
valid notice of the stockholders meeting.
50
His letter dated December
1, 2004 addressed to ABC INCORPORATED cannot possibly
constitute the notice contemplated under Section 50 of the
Corporation Code since it is undisputed that: (a) it was addressed to
ABC INCORPORATED, not to petitioners; (b) it was received by
ABC INCORPORATEDs counsel and corporate secretary, Atty.
Milagros Cristobal Amar,
51
not by petitioners; (c) this letter advised
against the holding of the December 2, 2004 Board of Directors
meeting of ABC INCORPORATED; and (d) Atty. ABUGADO was
not authorized to send notices of stockholders meetings as he was

49
Emphasis supplied.
50
Decision, p. 11.
51
Atty. XXXXr succeeded Atty. XXXafter the latter resigned as a result of his dealings with
respondents XXX Atty. PXXXXil and Atty. NXXXXtt.

G.R. NO. 168639
04381.10.004
30
not the corporate officer of ABC INCORPORATED authorized to
send such a notice. As confirmed by the Court of Appeals:

It should be noted that the meeting of the Board of Directors
of ABC INCORPORATED was originally scheduled on December
2, 2004. In view however, of the Order dated November 25, 2004 of
the respondent court, private respondents, through counsel, in a
letter dated December 1, 2004, requested for the deferment of the
December 2, 2004 Meeting. Also, attached to the letter is a copy of the
Order dated November 25, 2005, which ordered the holding of a
special stockholders meeting to be held at ABC
INCORPORATEDs principal place of business in Bayambang,
BULACAN on December 10, 2004, which letter was received by then
Corporate Secretary Milagros Isabel Cristobal Amar on December 2,
2004.
52

48. It is an established principle in corporation law that when
a special meeting is called, notice should be given to each stockholder
of record of the corporation entitled to vote at the meeting
53
and that
generally, such notice must be served on the stockholders
personally.
54
Hence, petitioners should have been personally notified
of the meeting. The letter sent by Atty. ABUGADO to ABC
INCORPORATEDs corporate secretary was not the notice required
by law and ABC INCORPORATEDs by-laws, which provide that:

Section 3. - Notice of meeting written or printed for every
regular or special meeting of the stockholders shall be prepared
and mailed to the registered post office address of each stockholder
not less than ten (10) days prior to the date set for such meeting,
and if for a special meeting, such notice shall state the object or
objects of the same. No failure or irregularity of notice of any
meeting shall invalidate such meeting at which all the shareholders
are present or represented by proxy and voting without protest.
55

Thus, the special stockholders meeting called by respondent
Judge on December 10, 2004 in Bayambang, BULACAN was clearly
and plainly invalid due, among others, to the defective notice to ABC

52
Decision, pp. 10-11; emphasis supplied.
53
5 Fletcher, Cyclopedia of the Law of Private Corporations 47 (1976).
54
Id., p. 49.
55
A copy of XXXXX INCs By-Laws is attached as Annex BB hereof.

G.R. NO. 168639
04381.10.004
31
INCORPORATEDs stockholders, rendering the notice ineffective as
if it was not issued at all.

Plaintiffs below are estopped from
questioning the validity of the
stockholders meeting of ABC
INCORPORATED on March 1,
2004.
49. Contrary to the ruling of the Court of Appeals, plaintiffs
below were clearly estopped from questioning the stockholders
meeting held on March 1, 2004. Firstly, plaintiffs below never
objected to the venue of the stockholders meeting held on March 1,
2004. Secondly, they not only assented to the election of petitioners
CULLEN and B. CULLEN as ABC INCORPORATEDs
Chairman/President and Treasurer, respectively, but also
subsequently recognized them as de jure directors and officers of ABC
INCORPORATED. Thirdly, respondents LADY DEL ROSARIO and
XXXXXX likewise elected themselves as directors of ABC
INCORPORATED during said meeting. The same private
respondents then assumed their office and discharged their functions
as directors of ABC INCORPORATED.

50. Hence, plaintiffs below were clearly estopped from
questioning the election of petitioners CULLEN and CULLEN, since
respondents LADY DEL ROSARIO and XXXXXX actively
participated in the election and thereafter accepted the result. It is a
settled principle in corporation law that (a) irregularities in either
time or place of a stockholders meeting may be waived or objections
thereto precluded; and (b) stockholders who were present and
participated in the meeting are estopped from complaining that it

G.R. NO. 168639
04381.10.004
32
was held at a place other than that prescribed.
56
Thus, plaintiffs
below, by their presence and active participation in the stockholders
meeting of ABC INCORPORATED held at its Pasig office, were
precluded from questioning the regularity of said meeting.

51. Nonetheless, the Court of Appeals ruled that plaintiffs
below were not estopped from questioning the stockholders meeting
held on March 1, 2004 since the filing of Civil Case No. SCC 2874
with the RTC San Carlos could only mean that they asserted their
right to question the validity of the said meeting. Thus:

The essence of estoppel and laches is the failure or neglect
for an unreasonable and unexplained length of time to do that
which by exercising due diligence could or should have been done
earlier; it is the negligence or omission to assert a right within a
reasonable time warranting a presumption that the party entitled to
it either has abandoned or declined to assert it. Delay is an
indispensable requisite for a finding of estoppel by laches.

In the instant case, private respondents filed SEC-2874
questioning the validity of the stockholders meeting and the
election of officers of ABC INCORPORATED on March 1, 2004
before the RTC of BULACAN on August 16, 2004. This could only
mean that private respondents are asserting their right to question
the validity of the stockholders meeting and the election of officers
of the corporation on March 1, 2004, within a reasonable time, or
without the principle of estoppel having set in. Besides, since
estoppel operates to prevent showing the truth, and is more or less
in the nature of forfeiture, it has often been characterized as not
favored in the law.
57

52. In ruling as it did, the Court of Appeals went beyond the
record and engaged in speculation. Although failure to act for an
unreasonable and unexplained length of time are essential requisites
of estoppel, it is established that there is no absolute rule with respect
to the determination of staleness of demand as each case should be

56
5 Fletcher Cyc Corp (Perm Ed) 2005, pp. 39-40 (1976).
57
Resolution, pp. 8-9.

G.R. NO. 168639
04381.10.004
33
determined based on its particular circumstances. As held by this
Honorable Court in Rayos, et al. vs. Reyes, et al.,
58

Moreover, we do not think that respondents causes of
action in Civil Case No. A-2032 are now barred by estoppel and
laches. The essence of estoppel and laches is the failure or neglect
for an unreasonable and unexplained length of time to do that
which by exercising due diligence could or should have been done
earlier; it is the negligence or omission to assert a right within a
reasonable time warranting a presumption that the party entitled to
assert it either has abandoned or declined to assert it although there
is no absolute rule as to what constitutes staleness of demand as each case
is to be determined according to its particular circumstances.
59

53. In this case, plaintiffs below not only acquiesced to the
holdings of the previous stockholders meetings in Pasig City, but
they also participated in it, received per diems, and recognized the
offices of the directors and officers who were elected. Otherwise
stated, the laches or estoppel of plaintiffs was based on positive acts
and declarations, which became conclusive and binding upon them.
Under Article 1431 of the Civil Code, repeated in Rule 131, Section 2
(a) of the Revised Rules of Evidence, respondents estoppel results in
an admission:

Through estoppel an admission or representation is
rendered conclusive upon the person making it, and cannot be
denied or disproved as against the person relying thereon.

54. More importantly, as will be discussed below, plaintiffs
below were barred from filing Civil (SEC) Case No. U-14, the latter
being an election contest. This further confirms that plaintiffs below
slept on their rights.

Plaintiffs below were barred from
instituting Civil (SEC) Case No. U-
14 before the RTC XXXXXX.

58
398 SCRA 24 (2003).
59
Id., at p. 35; emphasis supplied.

G.R. NO. 168639
04381.10.004
34
55. One of the relief sought by respondents LADY DEL
ROSARIO, XXXXXX and XXXXXX was the nullification of the
election of the Board of Directors during the meeting on March 1,
2004. Hence, the case before the RTC XXXXXX was an election
contest that fell squarely under the Interim Rules. Under the Interim
Rules, an election contest refers to any controversy or dispute
involving title or claim to any elective office in a stock or non-stock
corporation, the validation of proxies, the manner of validation of
elections and the qualifications of candidates, including the
proclamation of winners, to the office of director.
60

56. The Court of Appeals itself confirmed in its Resolution
that the case before the RTC XXXXXX was an election contest:

Likewise, as clearly provided in Section 1, Rule 1 of the
(Interim Rules) under R.A. 8799, among the intra-corporate
controversies transferred to the special courts are:
. . .

(3) Controversies in the election or appointment of
directors, trustees, officers, or managers of corporations,
partnerships or associations;
. . .

Undoubtedly, therefore, the instant case is an intra-corporate
controversy among the stockholders themselves relative to the
election of directors or officers of ABC INCORPORATED,
specifically between private respondents on one hand and
petitioners on the other.
. . .

If there is still any doubt that the Special Corporate Court
can call for a stockholders meeting, Rule 6 of the (Interim Rules)
completely puts to rest said issue.

RULE 6. ELECTION CONTESTS

Section 1. Cases covered. The provisions of this rule shall
apply to election contests in stock and non-stock corporations.
. . .

60
Interim Rules, Rule 6, Sec. 2.

G.R. NO. 168639
04381.10.004
35
Clearly, therefore, said Rule empowers the special corporate courts
to decide election cases.
61

57. Under the Interim Rules, an election protest must be
filed within 15 days from the date of election if the by-laws of the
corporation do not provide for a procedure for resolution of the
controversy by the corporation as provided in the by-laws of the
corporation.
62
In the case below, it was patently obvious that Civil
(SEC) Case No. U-14 was filed beyond the 15-day prescriptive period
since the election was held on March 1, 2004, while the complaint was
filed only on June 21, 2004.

58. In addition to the fact that plaintiffs below were barred
from instituting Civil (SEC) Case No. U-14, the action should
likewise have been dismissed for failure to comply with the
requirements of the Interim Rules that the complaint must state the
following: (a) the fact that the case was filed within 15 days from the
date of the election if the by-laws of the corporation do not provide
for a procedure for a resolution of the controversy, or within 15 days
from the resolution of the controversy by the corporation as provided
in its by-laws; and (b) the fact that plaintiffs had exhausted all intra-
corporate remedies in election cases as provided in the by-laws.
Nowhere in their complaint did plaintiffs below state these
conditions precedent. The Court of Appeals, for reasons to be
explained later, chose to ignore these fatal defects in affirming the
unlawful acts of respondent Judge.

The issuance of a writ of preliminary
injunction/ preliminary mandatory
injunction by the RTC XXXXXX
was not valid.

61
Resolution, pp. 3-6; emphasis supplied.
62
Rule 6, Sec. 3, Interim Rules.

G.R. NO. 168639
04381.10.004
36

59. It is settled that the sole purpose of an injunction is not to
correct a wrong of the past, in the sense of redress for injury already
sustained, but to prevent further or future injury. In First Global Realty
and Development Corporation vs. San Agustin,
63
made this clear:

The purpose of a preliminary injunction, then, is to prevent
threatened or continuous irremediable injury to some of the parties
before their claims can be thoroughly studied and adjudicated. Its
sole aim is to preserve the status quo until the merits of the case can
be fully heard. Thus, it will be issued only upon a showing of a
clear an unmistakable right that is violated. Moreover, an urgent
and permanent necessity for its issuance must be shown by the
applicant.
64

60. In this case, plaintiffs below failed to allege, much less
prove, that their application for the issuance of a temporary
restraining order and/or writ of preliminary injunction before the
RTC XXXXXX was of extreme urgency that they would suffer grave
or irreparable injury by petitioners CULLENs and B. CULLENs
continuance in office as directors and corporate officers. Instead, as
discussed above, the same respondents did not object to the venue of
the stockholders meeting held on March 1, 2004. Plaintiffs below not
only assented to the election of petitioners CULLEN and CULLEN
during the meeting held on March 1, 2004 but respondents LADY
DEL ROSARIO and XXXXXX likewise elected themselves as
directors of ABC INCORPORATED during the meeting.

61. Furthermore, respondent Judge committed grave abuse
of discretion when he granted plaintiffs application for a preliminary
mandatory injunction in his Order dated November 25, 2004 and, at

63
377 SCRA 341 (2002).
64

G.R. NO. 168639
04381.10.004
37
the same time, directed the holding of a special stockholders meeting
in Bayambang, BULACAN on December 10, 2004. This ruling
effectively resolved, ahead of trial, the issue in the principal action of
whether the stockholders meeting held on March 1, 2004 at the Pasig
office of ABC INCORPORATED was valid.

62. Respondent Judges action ran counter to the established
principle in jurisprudence that the court should avoid issuing a writ
of preliminary injunction that would in effect dispose of the main
case without trial.
65
When respondent Judge ordered the holding of
the stockholders meeting in Bayambang, BULACAN on December
10, 2004, he impliedly ruled that the earlier annual stockholders
meeting of March 1, 2004 at ABC INCORPORATEDs Pasig office
was void. By ordering the holding of a stockholders meeting at the
behest and within the control of plaintiffs below, respondent
Judge effectively set aside the outcome of the meeting and election on
March 1, 2004. It unavoidably resulted in respondent Judges virtual
affirmation of the merits of the claim of plaintiffs below.

63. Respondent Judge evidently forgot that the object of the
writ of preliminary injunction is to preserve the status quo, which is
the last actual peaceable uncontested status that preceded the
pending controversy.
66
In this case, the last actual peaceable
uncontested status that preceded the controversy was the holding of
the annual stockholders meeting and the ensuing election of ABC
INCORPORATEDs officers on March 1, 2004. Thus, when
respondent Judge granted the writ of preliminary injunction and

65
Search Commodities Corp. v. Court of Appeals, 207 SCRA 622, 629-630 (1992), citing Rivas
Securities and Exchange Commission, 190 SCRA 295 (1990); Government Service Insurance
System v. Florendo, 178 SCRA 76 (1989); and Ortigas & Co. Ltd. Partnership v. Court of Appeals,
162 SCRA 165 (1988).
66
Id., at 630, citing Rivas v. Securities and Exchange Commission, supra; Tengson v. Court of
Appeals, 161 SCRA 745 (1988); Rodulfa v. Alonzo, 76 Phil. 225 (1946).

G.R. NO. 168639
04381.10.004
38
directed the holding of a special stockholders meeting, it disturbed,
instead of preserved, the status quo ante.

64. Although the courts are granted discretion when to issue
a writ of preliminary injunction, nevertheless, this authority is not
coupled with an unbridled exercise of discretion. Courts,
notwithstanding the discretion given to them, must avoid issuing a
writ of preliminary injunction which in effect disposes of the main
case without trial,
67
especially in this case where the distance of travel
between Metro Manila and Samar city and the short notice given to
petitioners practically deprived them of their day in court.

Respondent Judge violated the
principle of judicial stability by
issuing the Order dated November 25,
2004.

65. Likewise, respondent Judge cannot and should not
interfere with another co-equal courts orders and processes issued
within the jurisdiction of the latter. In Philippine Commercial
International Bank vs. Court of Appeals,
68
this Honorable Court held:

The private respondents even brazenly violated the principle
of judicial stability, which essentially states that the judgment or
order of a court of competent jurisdiction may not be interfered with by
any court of concurrent jurisdiction for the simple reason that the
power to open, modify or vacate the said judgment or order is not
only possessed but is restricted to the court in which the judgment or
order is rendered or issued. Accordingly, no court has the power to
interfere by injunction with the judgment or decrees of a court of
concurrent jurisdiction having the power to grant relief sought by
injunction. The various branches of the RTC having as they have
the same or equal authority and exercising as they do concurrent
and coordinate jurisdiction should not, cannot and are not
permitted to intervene with their respective cases, much less with

67
Central Bank of the Philippines v. Court of Appeals, 208 SCRA 652, 684. (1992).
68
406 SCRA 575 (2003).

G.R. NO. 168639
04381.10.004
39
their orders or judgments. A contrary rule would lead to confusion,
and seriously hamper the administration of justice.
69

66. In Spouses Ching vs. Court of Appeals,
70
this Tribunal
explained the history of this rule:

Beginning with the case of Orais v. Escao, down to the
subsequent cases of Nuez v. Low, Cabigao v. del Rosario, Hubahib v.
Insular Drug Co., Inc., National Power Corp. v. De Veyra, Luciano v.
Provincial Governor, De Leon v. Hon. Judge Salvador, Cojuangco v.
Villegas, Darwin v. Tokonaga, we laid down the long standing
doctrine that no court has the power to interfere by injunction with
the judgments or decrees of a court of concurrent or coordinate
jurisdiction. The various trial courts of a province or city, having
the same or equal authority, should not, cannot, and are not
permitted to interfere with their respective cases, much less with
their orders or judgments. A contrary rule would obviously lead to
confusion and seriously hamper the administration of justice.
71

67. The record shows that the RTC Pasig previously issued a
writ of preliminary injunction as early as July 19, 2004
72
enjoining the
defendants in Civil Case No. 70027, as well as all persons acting
under them, from registering/recording the sold shares of stocks in
the books of ABC INCORPORATED, or canceling them and issuing
new ones in favor of defendant CCCCC INC to enable it to exercise
the rights of ownership over said shares owned by plaintiff
(petitioner CULLEN) in violation of the latters rights. These shares
were the same shares claimed by respondent LADY DEL ROSARIO
to establish a quorum during the meeting ordered by respondent
Judge on December 10, 2004. The RTC Pasig further issued an Order
dated November 8, 2004
73
nullifying the transfer pendente lite of these
shares in favor of respondent LADY DEL ROSARIO, thereby barring

69
70
398 SCRA 88, 92-93 (2003).
71
Emphasis ours.
72
Please see Annex G hereof.
73
A copy of the RTC Pasigs Order dated November 8, 2004 is attached as Annex CC hereof.

G.R. NO. 168639
04381.10.004
40
Mr. LADY DEL ROSARIO from mustering a quorum in any
shareholders meeting of ABC INCORPORATED.

68. In violation of law and applicable decisions of this
Honorable Court, respondent Judge interfered with the proceedings
in Civil Case No. 70027 through his Order dated November 25, 2004
by authorizing the release of the STB to plaintiffs below. In turn, the
release of the STB to said respondents enabled respondent LADY
DEL ROSARIO to proceed with the void stockholders meeting on
December 10, 2004 by disregarding the RTC Pasigs nullification of
the transfer of the pledged shares to respondent LADY DEL
ROSARIO. By virtue of the preliminary injunction issued by
respondent Judge, respondent LADY DEL ROSARIO unlawfully
voted the pledged shares that pertained to petitioners. Had these
shares not been counted pursuant to the Order dated July 19, 2004 of
the RTC Pasig, which nullified the transfer pendent lite to LADY DEL
ROSARIO, there would have been no quorum for the void meeting
called by RTC XXXXXX on December 10, 2004.

69. In its Resolution, the Court of Appeals disregarded
petitioners argument on the principle of judicial stability by
reversing the rule and stating that the court which has jurisdiction
over the intra-corporate case filed by private respondents is the
public respondent court to the exclusion of the Pasig Court.
74
The
Court of Appeals was obviously misled into misapprehending the
facts, when it became confused by the realization that the action
pending before the RTC Pasig did not involve an intra-corporate
controversy.

74
Resolution, p. 11.

G.R. NO. 168639
04381.10.004
41
70. It is true that Civil Case No. 70027 does not involve an
intra-corporate dispute. What it involves is an action for injunction
to prevent the unlawful transfer of CULLENs shares to CCCCC INC
and then to LADY DEL ROSARIO on the ground that the foreclosure
of the pledged shares was improper and void. Petitioner CULLEN
sought to immediately restrain and preliminarily enjoin therein
defendants CCCCC INC, Atty. Nethercott and Atty. Mataban from
proceeding with the auction sale of the ABC INCORPORATED
shares pledged by petitioners to CCCCC INC. Petitioner CULLEN
also sought to enjoin defendants therein from (a) executing any
certificate of sale of such shares; (b) recording such shares in the
books of ABC INCORPORATED; (c) canceling the pledged shares
and issuing new ones in favor of defendants therein or any bidder; or
(d) exercising any rights of ownership over such shares. While
defendants CCCCC INC, Atty. Nethercott and Atty. Mataban are not
directors, stockholders or officers of ABC INCORPORATED, the
ownership of the pledged shares was the very lis mota of the case.

71. Since the RTC Pasig clearly has jurisdiction over Civil
Case No. 70027, the RTC XXXXXX cannot interfere with the writ of
preliminary injunction issued by the RTC Pasig by issuing the
conflicting Order dated November 25, 2004. The Order was per se
void and unenforceable.

Respondent Judge did not have the
authority to enjoin petitioners or to
order petitioner B. CULLEN to
surrender the duplicate key of the
safety deposit box where ABC
INCORPORATEDs stock and
transfer book was deposited.

G.R. NO. 168639
04381.10.004
42

72. Similarly, Respondent Judge had no authority to enjoin
petitioners from discharging their functions as directors and officers
of ABC INCORPORATED or to order petitioner B. CULLEN to
surrender the duplicate key of the safety deposit box where ABC
INCORPORATEDs original STB was kept, since petitioners reside
outside the First Judicial Region and respondent LADY DEL
ROSARIO himself conceded that the issue of the possession of the
STB was still pending before the RTC Pasig in Civil Case No. 70027.
Respondent Judge was aware of the facts of Civil Case No. 70027
because petitioners summarized the case in their Answer with
Counterclaim dated October 28, 2004
75
that they filed with the RTC
XXXXXX on November 2, 2004, where petitioners averred:

9. Prior thereto on June 21, 2004, defendant Mr.
CULLEN filed Civil Case No. 70027, entitled Aderito Z. CULLEN
vs. United Resources Asset Management, Inc., Atty. Richard J.
Nethercott and Atty. Honorato R. Mataban, with the Regional Trial
Court in Pasig City, Branch 71. Mr. CULLEN sought to (a)
immediately restrain and preliminarily enjoin defendants therein
from proceeding with the auction sale of the shares pledged by
ABC INCORPORATED to CCCCC INC; (b) enjoin defendants from
executing any certificate of sale of such shares, from recording such
shares in the books of ABC INCORPORATED, from canceling the
pledged shares and issuing new ones in favor of defendants or any
bidder, or from exercising any rights of ownership over such
shares; and (c) declare void defendants foreclosure of the pledged
shares, any auction sale, certificate of sale, registration of sale,
cancellation of shares, issuance of new shares, transfer or
assignment of new shares and the exercise of any rights of
ownership over such pledged shares.

10. Before the RTC Pasig issued a TRO, the auction sale of
the pledged shares proceeded and was conducted by Atty.
Mataban, with CCCCC INC being the highest bidder for said
shares. On the same day, CCCCC INC sold the auctioned shares to
one of the plaintiffs herein, Mr. LADY DEL ROSARIO. On June 30,
2004, the RTC Pasig issued its TRO, stating that:

In the broader interest of justice and so as not
to render moot and academic the issue on the grant or

75
Please see Annex L hereof.

G.R. NO. 168639
04381.10.004
43
not of the writ, let this Temporary Restraining Order
be issued enjoining defendants, their officers, agents
and assigns from recording such sale in the books of
ABC INCORPORATED or from canceling the
pledged shares and issuing new ones in favor of
defendants or from exercising any rights of
ownership over such shares in violation of plaintiffs
rights. The Corporate Secretary of ABC
INCORPORATED is directed to hold in abeyance the
cancellation of the pledged shares and to restore
them, if cancelled, in the books of the corporation
until further orders from this Court.

11. On June 30, 2004, upon getting wind of the issuance
of the TRO, Mr. LADY DEL ROSARIO and Atty. Nethercott
compelled ABC INCORPORATEDs corporate secretary, Atty.
Joselito G. Blando, to immediately transfer the auctioned shares to
CCCCC INC and then to transfer it again from CCCCC INC to Mr.
LADY DEL ROSARIO. Mr. LADY DEL ROSARIO and Atty. DOE,
conspiring with each other, refused to turn over the STB to Atty.
Blando but demanded that he cancel the pledged shares and to
issue new shares to CCCCC INC and Mr. LADY DEL ROSARIO
only in the latters presence in Atty. DOEs office inside the Land
Transportation Office compound in Quezon City. The cancellation
and transfer were made to beat the TRO that by then had been
issued by the RTC Pasig.

12. After Atty. Blando received the TRO on July 1, 2004
and tried, but failed, to undo the cancellation and transfer of the
shares due to Mr. LADY DEL ROSARIOs unlawful detention of
the STB, ABC INCORPORATED declared the STB as lost and
reconstituted its entries. The cancellation and transfer were then
reversed by ABC INCORPORATED in compliance with the TRO.

13. In the meantime on July 19, 2004, the RTC Pasig
issued a writ of preliminary injunction stating that:

IT IS HEREBY ORDERED by the undersigned
Judge of this Court, that until further orders, you, the
said defendants United Resources Asset
Management, Inc. (CCCCC INC for short), Atty.
Richard J. Nethercott, and Atty. Honorato R.
Mataban, and all persons acting under them, to desist
and refrain from further proceeding with the public
auction sale of the pledged shares of stocks by
registering/recording the sold shares of stocks in the
books of ABC INCORPORATED, or canceling them
and issuing new ones in favor of defendant CCCCC
INC to enable it to exercise the rights of ownership
over said shares owned by plaintiff in violation of the
latters rights.

G.R. NO. 168639
04381.10.004
44

SO ORDERED.

14. Thereafter, Mr. LADY DEL ROSARIO refused to
comply with the subpoena issued by the RTC Pasig to produce the
STB in Civil Case No. 70027. He also rejected the demand of Mr.
CULLENs counsel to surrender the STB within 24 hours, on the
ground that the STBs possession is being litigated in that action:

As you are aware, the matter of possession of
ABC INCORPORATEDs Stock and Transfer Book is
currently being litigated in Civil Case No. 70027,
entitled Aderito Z. CULLEN vs. United Resources Asset
Management, Inc., Et Al., pending before the Regional
Trial Court of Pasig City (Branch 71), where I am
represented by Tan Acut & Lopez Law Offices, my
counsel de parte.

15. As of this writing, Mr. LADY DEL ROSARIO, by way
of special appearance, continues to participate in Civil Case No.
70027 in RTC Pasig by filing motions and pleadings, examining
witnesses, presenting evidence, and otherwise actively prosecuting
and defending his claims therein as if he were a party in that case.

73. More importantly, the RTC Pasig issued an Order dated
November 8, 2004
76
nullifying the transfer of the pledged shares in
favor of respondent LADY DEL ROSARIO, thereby restoring
petitioners foreclosed shares in the books of ABC INCORPORATED:

When LADY DEL ROSARIO acquired the shares of
defendant CCCCC INC, he stepped into the shoes of CCCCC INC.
He became bound by whatever imperfect title defendant CCCCC
INC might have over the foreclosed shares. LADY DEL ROSARIO
acquired defendant CCCCC INCs interest in the pledged shares
subject to the claim of the plaintiff, as the stock and transfer book
contained an annotation made by Atty. Blando, corporate secretary,
clearly referring to his action.

LADY DEL ROSARIO is not entitled to the protection as an
innocent purchaser for value. By the deplorable action he took on
June 30, 2004, when the TRO was issued, he, together with
defendant Atty. Nethercott, Atty. DOE who was replaced as
corporate secretary by Atty. Blando, and one Atty. Matibag, for
LADY DEL ROSARIO, anticipated the issuance of the temporary
restraining order dated June 30, 2004 and tired to render it moot
and academic by pressuring Atty. Blando to cancel the pledged
shares in the stock and transfer book of ABC INCORPORATED.

76
Please see Annex CC hereof.

G.R. NO. 168639
04381.10.004
45

The prayer in plaintiffs omnibus motion dated July 20, 2004
to nullify the cancellation and transfer of the pledged shares to
defendant CCCCC INC and LADY DEL ROSARIO being violative
of the temporary restraining order dated June 30, 2004 and
strengthened by a writ of preliminary injunction dated July 19, 2004
is allowed.

The Corporate Secretary of ABC INCORPORATED is
directed to restore the pledged shares in the stock and transfer
book in the name of the pledgors and to cancel any and all
certificates issued in the name of any transferee subsequent to the
pledgors in accordance with the Order dated July 5, 2002 and the
Amended Order dated July 19, 2004 granting the verified
application for the issuance of a writ of preliminary injunction with
the writ of preliminary injunction issued on July 19, 2004.

It is obvious that the enjoined acts of canceling the pledged
shares and issuing new ones in favor of the defendants precisely
include the pledged shares transfer. Since the cancellation and
transfer of the pledged shares to defendant CCCCC INC and to
LADY DEL ROSARIO violate the Order dated June 30, 2004, and
acts of canceling and transferring of the pledged shares are
declared null and void.
. . .

WHEREFORE, plaintiffs Omnibus Motion dated July 20,
2204, being impressed with merit, is GRANTED. The cancellation
and transfer of the pledged shares to defendant CCCCC INC and
LADY DEL ROSARIO are NULLIFIED.

The defendants Omnibus Motion dated September 22, 2004
is hereby DENIED for lack of merit.

LADY DEL ROSARIOs Motion for Leave to Recall Witness
Bonifacio C. CULLEN dated October 11, 2004 is considered MOOT
and ACADEMIC in view of the Order dated October 7, 2004.

SO ORDERED.

74. Assuming hypothetically that the Order dated November
25, 2004 of respondent Judge was valid, respondent LADY DEL
ROSARIO was not authorized to break open the safety deposit box in
Pasig City on December 8, 2004, before petitioners received a copy of
the Order dated November 25, 2004. The RTC could not have
authorized respondent LADY DEL ROSARIO to break open the

G.R. NO. 168639
04381.10.004
46
safety deposit box because it did not have jurisdiction over Export
Industry Bank, Pasig City branch, where the subject safety deposit
box was located. It is settled that the jurisdiction of Regional Trial
Courts to issue injunctive writs is limited to acts committed or about
to be committed within their judicial region.
77
The territorial
jurisdiction of the RTC XXXXXX is limited to the First Judicial Region
and does not encompass the National Capital Judicial Region.

75. Furthermore, in respondent Judges Order dated
November 25, 2004, he merely directed petitioner B. CULLEN to
surrender to the court the duplicate key given to him by Export
Industry Bank. Respondent Judge did not authorize respondent
LADY DEL ROSARIO to break open the safety deposit box.

By participating in Civil Case No.
70027 and filing the case a quo,
respondent LADY DEL ROSARIO
and his counsel engaged in forum
shopping.

76. Respondent LADY DEL ROSARIO admitted in a letter
dated September 6, 2004,
78
that the matter of possession of ABC
INCORPORATEDs Stock and Transfer Book is currently being
litigated in Civil Case No. 70027. Yet, in his Supplemental
Complaint dated September 16, 2004 in Civil (SEC) Case No. U-14
before the RTC XXXXXX, respondent LADY DEL ROSARIO prayed
that defendant Bonifacio CULLEN and plaintiff Cezar T. LADY DEL
ROSARIO (be ordered) to surrender to the custody of this
Honorable Court the original copies of the Stock and Transfer Books

77
Bangus Fry Fisherfolk vs. Lanzanas, 405 SCRA 530, 537 (2003).
78
Please see Annex H hereof.

G.R. NO. 168639
04381.10.004
47
of the corporation.
79
In other words, respondent LADY DEL
ROSARIO asked two different courts to rule on the same legal issue.

77. Thus, while the matter of possession of ABC
INCORPORATEDs STB was being litigated in Civil Case No. 70027,
respondent LADY DEL ROSARIO was able to secure in bad faith a
writ of preliminary injunction before the RTC XXXXXX, which
enabled him to take legal custody of ABC INCORPORATEDs STB,
thereby pre-empting the RTC Pasig. In Viva Films Productions, Inc. vs.
Court of Appeals,
80
this Honorable Court held that there is a clear case
of forum shopping if the ultimate objectives of two ostensibly
different actions are the same:

Ordinarily, where a litigant sues the same party against
whom another action or actions for the alleged violation of the
same right and the enforcement of the same relief or reliefs is or are
still pending, any one action may be dismissed on the ground of
litis pendentia and a final judgment in any one case would constitute
res judicata on the other. In either instance, there is a clear and
undeniable case of forum shopping, another ground for the summary
dismissal of both actions
In First Philippine International Bank vs. Court of Appeals (252
SCRA 259 [1996]), this Court, through the same herein Division, per
Justice Panganiban, found therein petitioner bank guilty of forum
shopping because

. . . the objective or the relief being sought, though worded
differently, is the same, namely, to enable the petitioner Bank
to escape from the obligation to sell the property to
respondent. In Danville Maritime vs. Commission on Audit,
this Court ruled that the filing by any party of two
apparently different actions, but with the same objective,
constituted forum shopping:

"In the attempt to make the two actions appear to be
different, petitioner impleaded different respondents
therein PNOC in the case before the lower court and the
COA in the case before this Court and sought what seems
to be different reliefs. Petitioner asks this Court to set aside
the questioned letter-directive of the COA dated October
10, 1988 and to direct said body to approve the

79
Please see Annex J hereof.
80
269 SCRA 664 (1997).

G.R. NO. 168639
04381.10.004
48
Memorandum of Agreement entered into by and between
the PNOC and petitioner, while in the complaint before the
lower court petitioner seeks to enjoin the PNOC from
conducting a rebidding and from selling to other parties
the vessel "T/T Andres Bonifacio," and for an extension of
time for it to comply with the paragraph 1 of the
memorandum of agreement and damages. One can see that
although the relief prayed for in the two (2) actions are ostensibly
different, the ultimate objective in both actions is the same, that
is, the approval of the sale of vessel in favor of petitioner, and to
overturn the letter directive of the COA of October 10, 1988
disapproving the sale."

In Palm Avenue Realty Development Corporation vs. PCGG (153
SCRA 579 [1987]), we have these words from then Justice, now
Chief Justice Narvasa:

. . . the filing by the petitioners of the instant special
civil action for certiorari and prohibition in this Court
despite the pendency of their action in the Makati Regional
Trial Court, is a species of forum shopping. Both actions
unquestionably involve the same transactions, the same essential
facts and circumstances. The petitioners' claim of absence of
identity simply because the PCGG had not been impleaded
in the RTC suit, and the suit did not involve certain acts
which transpired after its commencement, is specious. In
the RTC action, as in the action before this Court, the
validity of the contract to purchase and sell of September 1,
1986, i.e., whether or not it had been efficaciously
rescinded, and the propriety of implementing the same . . .
were the basic issues. So, too, the relief was the same: the
prevention of such implementation and/or the restoration
of the status quo ante. When the acts sought to be restrained
took place anyway despite the issuance by the Trial Court
of a temporary restraining order, the RTC suit did not
become functus officio. It remained an effective vehicle for
obtention of relief; and petitioners' remedy in the premises
was plain and patent; the filing of an amended and
supplemental pleading in the RTC suit, so as to include the
PCGG as defendant and seek nullification of the acts
sought to be enjoined but nonetheless done. The remedy
was certainly not the institution of another action in
another forum based on essentially the same facts. The
adoption of this latter recourse renders the petitioner
amenable to disciplinary action and both their actions, in
this Court as well as in the Court a quo dismissible.
81

81
Id., at pp. 671-673; emphasis supplied.

G.R. NO. 168639
04381.10.004
49
78. In the more recent case of Gochan vs. Gochan,
82
this
Honorable Court held that:

The deplorable practice of forum-shopping is resorted to by
litigants who, for the purpose of obtaining the same relief, resort to
two different fora to increase his or her chances of obtaining a favorable
judgment in either one. In the case of Golangco v. Court of Appeals, we
laid down the following test to determine whether there is forum-
shopping:

Ultimately, what is truly important to consider in
determining whether forum-shopping exists or not is the
vexation caused the courts and the parties-litigant by a person who
asks different courts and/or administrative agencies to rule on the
same or related causes and/or grant the same or substantially the
same reliefs, in the process creating the possibility of conflicting
decisions being rendered by the different fora upon the same issues.
83

. . .

79. In United Residents of Dominican Hill vs. Commission on the
Settlement of Land Problems,
84
this Honorable Court likewise held:

In view of the foregoing, all that remains to be done is the
imposition of the proper penalty. A partys willful and deliberate act of
forum shopping is punishable by summary dismissal of the actions
filed. The summary dismissal of both COSLAP Case No. 98-253 and
Civil Case No. 3316-R is therefore warranted under the premises.
We shall refrain from making any pronouncement on Civil Case
No. 3382-R, the dismissal of which was elevated on appeal to the
Court of Appeals where it is still pending.
85

80. Furthermore, in Prubankers Association vs. Prudential Bank
& Trust Co.,
86
this Honorable Court ordered the dismissal of the two
subject actions upon a finding that petitioner committed forum
shopping:

We sustain the respondent. The rule on forum-shopping was
first included in Section 17 of the Interim Rules and Guidelines
issued by this Court on January 11, 1983, which imposed a sanction

82
372 SCRA 256 (2001).
83
Id., at 266.
84
353 SCRA 782 (2001).
85
86
302 SCRA 71 (1999).

G.R. NO. 168639
04381.10.004
50
in this wise: A violation of the rule shall constitute contempt of
court and shall be a cause for the summary dismissal of both petitions,
without prejudice to the taking of appropriate action against the
counsel or party concerned. Thereafter, the Court restated the rule
in Revised Circular No. 28-91 and Administrative Circular No. 04-
94. Ultimately, the rule was embodied in the 1997 amendments to
the Rules of Court.

As explained by this Court in First Philippine International
Bank v. Court of Appeals, forum-shopping exists where the elements
of litis pendentia are present, and where a final judgment in one case
will amount to res judicata in the other. Thus, there is forum-
shopping when, between an action pending before this Court and
another one, there exist: a) identity of parties, or at least such
parties as represent the same interests in both actions, b) identity of
rights asserted and relief prayed for, the relief being founded on the
same facts, and c) the identity of the two preceding particulars is
such that any judgment rendered in the other action, will,
regardless of which party is successful amount to res judicata in the
action under consideration; said requisites also constitutive of the
requisites for auter action pendant or lis pendens. Another case
elucidates the consequence of forum-shopping: [W]here a litigant
sues the same party against whom another action or actions for the
alleged violation of the same right and the enforcement of the same
relief is/are still pending, the defense of litis pendentia in one case is
a bar to the others; and, a final judgment in one would constitute
res judicata and thus would cause the dismissal of the rest.

The voluntary arbitration case involved the issue of whether
the adoption by the Bank of regionalized hiring rates was valid and
binding. On the other hand, the issue now on hand revolves
around the existence of a wage distortion arising from the Bank's
separate and regional implementation of the two Wage Orders in
the affected branches. A closer look would show that, indeed, the
requisites of forum-shopping are present.

First, there is identity of parties. Both cases are between the
Bank and the Association acting on behalf of all its members.
Second, although the respective issues and reliefs prayed for in the two
cases are stated differently, both actions boil down to one single issue: the
validity of the Banks regionalization of its wage structure based on
RA 6727. Even if the voluntary arbitration case calls for striking
down the Banks regionalized hiring scheme while the instant
petition calls for the correction of the alleged wage distortion
caused by the regional implementation of Wage Order No. VII-03,
the ultimate relief prayed for in both cases is the maintenance of the
Bank's national wage structure. Hence, the final disposition of one
would constitute res judicata in the other. Thus forum-shopping is
deemed to exist and, on this basis, the summary dismissal of both
actions is indeed warranted.
87

87

G.R. NO. 168639
04381.10.004
51

81. It is clear that the institution of Civil (SEC) Case No. U-14
amounts to forum shopping. Indeed, respondent LADY DEL
ROSARIO actively participated in the proceedings for Civil Case No.
70027, where he contested petitioners right to possess ABC
INCORPORATEDs stock and transfer book. Yet, he filed the action
below where he secured the assailed Order that enabled him to take
possession of ABC INCORPORATEDs STB. After respondent LADY
DEL ROSARIO failed to obtain a favorable relief from the RTC Pasig,
he sought and obtained the same relief from the RTC XXXXXX,
through respondent Judge who was only too willing to accommodate
respondent LADY DEL ROSARIO. Thus, the objective or the relief
sought by respondent LADY DEL ROSARIO in both actions is the
same, namely, to enable him, among others, to take possession of the
corporations STB and thus, allow him to manipulate the
shareholdings in ABC INCORPORATED and establish control over
it, to petitioners damage and prejudice.

Associate Justice Mariano del Castillo
is disqualified from acting in CA-G.R.
SP No. 87785.
82. Petitioners are informed that Associate Justice Mariano C.
del Castillo, who penned the Decision, is married to Atty. Cynthia
Roxas-del Castillo, a partner of the law firm of Romulo Mabanta
Buenaventura Sayoc and de los Angeles.
88
Another partner at
RMBSA is Atty. Owen S. Carsi Cruz.

83. RMBSA and Atty. Cruz represented respondent LADY
DEL ROSARIO in the bidding for the Machine-Readable Passport
and Visa Project
89
of the Department of Foreign Affairs. The Project

88
Hereafter, RMBSA.
89
Hereafter, the Project.

G.R. NO. 168639
04381.10.004
52
was awarded by the DFA to BCA International, Inc.
90
on September
29, 2000 under the Build-Operate-Transfer Law. BCAs three
principal shareholders are petitioners CULLEN, B. CULLEN and
respondent LADY DEL ROSARIO.

84. While BCA is the party to the contract, it was respondent
LADY DEL ROSARIO who introduced BCA to Atty. Cruz.
Consequently, most dealings, transactions, correspondence and
communications between BCA and RMBSA were handled by
respondent LADY DEL ROSARIO and Atty. Cruz. For instance, in
an email dated September 2, 2003,
91
Atty. Cruz addressed the request
of a prospective investor to respondent LADY DEL ROSARIO alone,
and not to BCA and the three principal shareholders. In another
email dated August 5, 2003,
92
Atty. Cruz again addressed to
respondent LADY DEL ROSARIO alone the comment of a
prospective investor on the Project. In an email dated August 6,
2003
93
of Atty. Cruz to a prospective investor regarding the inability
of the principal shareholders of BCA to visit Singapore, Atty. Cruz
blind copied respondent LADY DEL ROSARIO alone. Again, in an
email dated August 27, 2003, Atty. Cruz forwarded to respondent
LADY DEL ROSARIO alone the prospective investors queries
addressed to BCA.

85. As a result of the dispute between respondent LADY DEL
ROSARIO and petitioners, RMBSA and Atty. Cruz have ceased to be
counsel for petitioners. However, Atty. Cruz and his law firm
continue to act as counsel for respondent LADY DEL ROSARIO and
to give him legal advice.

90
Hereafter, BCA.
91
A copy of the email dated September 2, 2003 is attached as Annex X hereof.
92
A copy of the email dated August 5, 2003 is attached as Annex Y hereof.
93
A copy of the email dated August 6, 2003 is attached as Annex Z hereof.

G.R. NO. 168639
04381.10.004
53

86. Canon 3, Rule 3.12 of the Code of Judicial Conduct
provides:

A judge shall take no part in a proceeding where the judges
impartiality might reasonably be questioned. These cases include,
among others, proceedings where:
. . .

(d) the judge is related by consanguinity or affinity
to a party litigant within the sixth degree or to counsel
within the fourth degree;

87. Rule 137, Section 1 of the Revised Rules of Court similarly
provides:

No judge or judicial officer shall sit in any case in which he,
or his wife or child, is pecuniarily interested as heir, legatee,
creditor or otherwise, or in which he is related to either party within
the sixth degree of consanguinity or affinity, or to counsel within the
fourth degree, computed according to the rules of the civil law, or in
which he has been executor, administrator, guardian, trustee or
counsel, or in which he has presided in any inferior court when his
ruling or decision is the subject of review, without the written consent
of all parties in interest, signed by them and entered upon the record.

A judge may, in the exercise of his sound discretion,
disqualify himself from sitting in a case, for just or valid reasons
other than those mentioned above.
94

88. The first paragraph of the foregoing rule enumerates the
grounds under which a judge is compulsorily disqualified from hearing
a case.
95
In cases of compulsory disqualification, the law conclusively
presumes that a judge cannot objectively or impartially sit in a case
and, for that reason, prohibits him and strikes at his authority to hear
and decide it. Citing Garcia vs. Dela Pea,
96
ruled in Sales vs. Calvan
97
that:

94
Emphasis supplied.
95
Pimentel vs. Salanga, 21 SCRA 160, 166 (1967).
96
129 SCRA 767 (1994).
97
378 SCRA 1 (2002).

G.R. NO. 168639
04381.10.004
54

The rule on compulsory disqualification of a judge to hear a
case where, as in the instant case, the respondent judge is related to
either party within the sixth degree of consanguinity or affinity
rests on the salutary principle that no judge should preside in a case in
which he is not wholly free, disinterested, impartial and independent. A
judge has both the duty of rendering a just decision and the duty of
doing it in a manner completely free from suspicion as to its
fairness and as to his integrity. The law conclusively presumes that a
judge cannot objectively or impartially sit in such a case and, for that
reason, prohibits him and strikes at his authority to hear and decide
it, in the absence of written consent of all parties concerned. The
purpose is to preserve the peoples faith and confidence in the
courts of justice.
98

89. The relationship between Associate Justice del Castillo
and Atty. Del Castillo is covered by the prohibition because as
husband and wife, they are related by affinity within the first degree.
It does not matter that Atty. Del Castillo herself was not personally
involved in the representation of respondent LADY DEL ROSARIO
in connection with the Project or with the cases below. The fact that
RMBSA, through Atty. Cruz, acts as counsel for respondent LADY
DEL ROSARIO is sufficient ground to disqualify Associate Justice del
Castillo from presiding over this case, let alone writing the
questioned Decision and Resolution.

90. In Paredes v. Gopengco,
99
this Honorable Court held that
the prohibition applies as well to the relationship between a judge
and a law firm, where a member of the law firm appeared as counsel
for a party who was also a party in another case pending in another
tribunal.

91. In Hurtado v. Judalena,
100
this Honorable Court set aside an
order issued by the judge of a trial court in a case where one of the

98
99
29 SCRA 688, 691 (1969).
100
84 SCRA 41, 44 (1978).

G.R. NO. 168639
04381.10.004
55
litigants was his brother. In the same vein, considering that the
questioned Decision and Resolution were rendered by a division of
the appellate court where the writer of the opinion is married to a
partner of a law firm who represents one of the respondents in this
case, then said Decision and Resolution must be nullified and set
aside.

92. Furthermore, since Associate Justice del Castillos
disqualification is absolute and compulsory pursuant to Rule 137,
Section 1 of the Rules of Court as well as the rulings of this
Honorable Court, the assailed Decision and Resolution were a patent
nullity for failure to comply with a mandatory provision of the Rules
of Court.
101
Consequently, the Decision and Resolution of the Court
of Appeals must be struck down for violation of the Rules of Court
and the Code of Judicial Conduct.
102

Application for a Temporary Restraining Order
and/or Preliminary Injunction

Petitioners replead the foregoing and further state:
93. Unless immediately restrained by this Honorable Court
upon receipt of this petition and until the matter can be heard on
notice, respondents will continue to proceed in Civil (SEC) Case No.
U-14 and enforce the invalid Order dated November 25, 2004 of
respondent Judge. Respondent LADY DEL ROSARIO has enforced
the questioned Order and is now in possession of ABC
INCORPORATEDs STB, even if he himself claims that the matter of
its possession is still being litigated in Civil Case No. 70027. Only
recently, he was able to obtain from the RTC XXXXXX, through the

101
Lu Ym vs. Nabua, et al., 452 SCRA 298, 311 (2005).
102
Ibid.

G.R. NO. 168639
04381.10.004
56
new presiding judge, an order authorizing him to record transactions
in the STB.
103
Hence, unless immediately restrained by this
Honorable Court, the RTC XXXXXX will proceed to try the case a quo
and continue to issue rulings and render judgment, which will not
only conflict with the rulings and the judgment of the RTC Pasig in
Civil Case No. 70027, but may also render the judgment as well as the
proceedings in this case ineffectual. Petitioners will then suffer grave
and irreparable injury, not to mention a failure of justice, since they
would be made to suffer the consequences of the void orders and
rulings of the RTC XXXXXX.

94. In fact, private respondents continue to hold invalid
stockholders and board of directors meetings of ABC
INCORPORATED. Atty. DOE, acting as ABC INCORPORATEDs
inofficious Corporate Secretary, continues to issue notices of said
meetings.
104
Respondent LADY DEL ROSARIO continues to claim the
existence of a quorum in the stockholders meetings based on his
unlawful acquisition of the foreclosed shares that were pledged to
CCCCC INC, which transfer has been nullified by the RTC Pasig in
its Order dated July 19, 2004. Respondent directors
and officers who were unlawfully elected during the invalid
December 10, 2004 stockholders meeting of ABC INCORPORATED
have unlawfully represented themselves to be duly elected directors
and officers of the Corporation.

95. The unlawful takeover of ABC INCORPORATED was
also followed by a series of unauthorized actions on the part of
private respondents, namely:

103
A copy of the Order dated July 20, 2005 of the RTC XXXXXX is attached as Annex DD
hereof.
104
A copy of the Notice of the Annual Stockholders and Organizational Board of Directors
Meetings of XXXXX INC, issued by Atty. Pilapil, is attached as Annex EE hereof.

G.R. NO. 168639
04381.10.004
57

(a) On December 17, 2004, undersigned counsel received a
letter
105
of even date from respondent LADY DEL ROSARIO, who
falsely represented himself to be the Chairman of the Board and
the President and Chief Executive Officer of ABC INCORPORATED.
In his letter, respondent LADY DEL ROSARIO informed
undersigned counsel that ABC INCORPORATED held a Special
Annual Stockholders Meeting last December 10, 2004, to elect the
members of the Board of Directors for the unexpired term of 2004-
2005. Subsequently, thereafter, the newly elected Board of Directors
duly elected the Corporate Officers for the unexpired term of 2004-
2005.

(b) In a letter dated December 17, 2004 addressed to ABC
INCORPORATEDs duly elected Corporate Secretary, Atty. Amar,
respondent LADY DEL ROSARIO falsely represented himself to be
the Chairman of the Board and the President and Chief Executive
Officer of ABC INCORPORATED. Respondent LADY DEL
ROSARIO cited therein a board resolution arrived at by ABC
INCORPORATEDs bogus Board of Directors which purportedly
terminated the services of Atty. Amar as Corporate Secretary, to wit:
RESOLVE FURTHER, as it is hereby resolved further, to
terminate the services of Atty. Milagros Isabel Cristobal Am(a)r,
and declare that she has no authority, by resolution or otherwise, to
represent the Corporation and effectively confess judgment (in
CULLEN, et al. v. ABC INCORPORATED, et al.); to direct Atty.
Am(a)r to surrender case files to the Corporation through Cezar T.
LADY DEL ROSARIO or counsel; and accordingly for the
Corporation, through Cezar T. LADY DEL ROSARIO, to engage
proper counsel to represent the Corporation in said case, as well as
file appropriate criminal, civil and/or administrative actions
against responsible persons.
106

105
A copy of the letter dated December 17, 2004 is attached as Annex FF hereof.
106
A copy of Mr. Quiambaos letter dated December 17, 2004 is attached as Annex GG hereof.

G.R. NO. 168639
04381.10.004
58
(c) Respondent LADY DEL ROSARIO and his agents and/or
assignees, Messrs. Anthony K. LADY DEL ROSARIO and Simplicio
T. LADY DEL ROSARIO, Jr., likewise unlawfully appointed
themselves as the signatories to ABC INCORPORATEDs bank
transactions.
107

96. As can be seen, private respondents have unlawfully
usurped the powers of the directors and officers of ABC
INCORPORATED on the basis of the void Order dated November 25,
2004 of respondent Judge. The acts of private respondents have
caused grave and irreparable injury to petitioners whose
shareholdings in ABC INCORPORATED were partially usurped by
respondent LADY DEL ROSARIO through the unlawful transfer of
the foreclosed shares. Private respondents unlawful acts have
likewise caused grave and irreparable injury to ABC
INCORPORATEDs other innocent stockholders and creditors who
may be (a) dealing with impostors such as respondents and their
agents; and (b) relying on void stockholders and board of directors
resolutions.

97. Thus, unless immediately restrained by this Honorable
Court and ordered to restore the status quo ante, private respondents
will, by their illegal and arbitrary acts, continue to violate petitioners
rights and render moot this petition and the proceedings in Civil
Case No. 70027, to petitioners grave damage and prejudice.

98. In support of their application for a temporary restraining
order and/or preliminary injunction, petitioners are willing to post a
bond, in such amount as may be fixed by this Honorable Court, to

107
A copy of the Directors Certificate dated December 10, 2004 is attached as Annex HH
hereof.

G.R. NO. 168639
04381.10.004
59
pay to private respondents any damage which they may suffer by
reason of the injunction, if this Honorable Court should finally decide
that petitioners were not entitled thereto.

R E L I E F

WHEREFORE, petitioners respectfully pray that this Honorable
Court:

(a) upon receipt of this petition, immediately
issue an order temporarily restraining (i) private
respondents, their successors and assigns, from holding
themselves out as and discharging the functions of
directors and officers of AAACCCBDDDDevelopment
Corporation (ABC INCORPORATED); and (ii)
respondents from further proceeding in Civil (SEC) Case
No. U-14 and from enforcing the questioned Order dated
November 25, 2004, until further orders from this
Honorable Court;

(b) after hearing, issue an order enjoining
respondents to maintain the status quo ante prior to the
issuance of the questioned Order dated November 25,
2004, pending the determination of the merits of this case;
and

(c) give due course to the petition and, after
proceedings duly had, render judgment:

G.R. NO. 168639
04381.10.004
60
(i) nullifying and setting aside the Court of
Appeals Decision dated March 31, 2005 and
Resolution dated June 29, 2005 for being contrary to
law, procedural rules and applicable decisions of
this Honorable Court;

(ii) nullifying respondent Judges Order
dated November 25, 2004 in Civil Case No. SCC
2874 (Civil [SEC] Case No. U-14) for having been
rendered without jurisdiction or with grave abuse
of discretion, amounting to lack or excess of
jurisdiction, and dismissing Civil (SEC) Case No. U-
14, with prejudice; and

(iii) making the injunction permanent by
requiring private respondents to restore the status
quo ante prior to the issuance of the questioned
Order dated November 25, 2004, which includes (1)
the return by respondent LADY DEL ROSARIO of
ABC INCORPORATEDs stock and transfer book to
the Corporate Secretary of ABC INCORPORATED,
Atty. Milagros Cristobal Amar, or her duly elected
successor/s; and (2) the nullification of all meetings
of ABC INCORPORATEDs stockholders and
Directors held pursuant to the assailed Order dated
November 25, 2004, including any and all actions
taken during the said meetings; (3) the nullification
of all acts performed by the directors and officers
elected during the said meetings, including acts
committed by private respondents.

G.R. NO. 168639
04381.10.004
61

Other reliefs, just or equitable, are also prayed for.

Makati City, August 19, 2005.
and a. sworn certification of non-forum
shopping as provided in the third
paragraph of section 3, Rule 46

xxxxxxxxxxxxxxxxxxxxxxxx J
Counsel for Petitioners
, The Valero Tower
Salcedo Village, Makati City

By:

xxxxxxxxxxxxxxxxxxx
Roll of Attorneys No. 33736
PTR No. 12121207/01-03-05/Makati City
IBP No. 122222/Lifetime/Quezon Province

xxxxxxxxxxxxxxxxxxxxxx
Roll of Attorneys No. xxxxx
PTR No. 12121/01-03-05/Makati City
IBP No. 1212122/01-04-05/Quezon City Chapter

COPY FURNISHED:

xxxxxxx
Counsel for Private Respondents
xxxxxxxxxxxxxxxxxx
Padre Faura Street, Manila

HON. ALEGRE
Regional Trial Court
Branch 47, Samar city
BULACAN

REGIONAL TRIAL COURT

G.R. NO. 168639
04381.10.004
62
First Judicial Region
Branch 48

COURT OF APPEALS
Eighth Division
Manila
CA-G.R. SP No. 87785

Petition For Certiorari

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Petition For Certiorari

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Section 1. Petition for certiorari.

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