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this Court in G.R. No. 63018 and on the basis of the Dissenting Opinion of the late Justice
FOUNDATION, INC., EDGARDO S. ISIP, HON. JUDGE MANUEL M. Claudio Teehankee, held that the disputed savings belong to the consumers.
The act therefore of the Minister of Finance was ultra vires, hence, null and
Interest republicae ut sit finis litiumi - it is to the interest of the public that there should be void. Considering that said act became the basis of the Board of Energys decision, it
an end to litigation by the same parties and their privies over a subject fully and fairly follows that said decision is likewise null and void and the Supreme Court resolution
adjudicated. From this overwhelming concern springs the doctrine of res judicata an obvious affirming said decision is also null and void having proceeded from a void judgment,
rule of reason according stability to judgments. hence, cannot be considered as valid judgment that will be a bar to the present

MERALCO CONTENTION: both holding that Meralco is authorized to retain its savings Motion for reconsideration was denied, Hence this petition.
realized under P.D. 551. Meralco likewise argues that respondent RTC cannot annul the
Resolution of this Court in G.R. No. 63018 considering that trial courts cannot set aside ISSUE:
decisions of a superior court.

On September 11, 1974, former President Ferdinand E. Marcos, with the objective of enabling RULING:
the grantees of electric franchises to reduce their rates "within the reach of consumers",ii
promulgated Presidential Decree No. 551iii providing for the reduction from 5% to 2% of the
franchise tax paid by electric companies The case can sanctioned under the principle of res judicata.

Philippine Consumers Foundation, Inc., (PCFI) filed with the Board of Energy (BOE) a Res judicata means a matter adjudged, a thing judicially acted upon or decided; a thing or
"Petition for Specific Performance, Damages and Violation of P. D. No. 551"iv against the matter settled by judgment.
Manila Electric Company (Meralco),
For a claim of res judicata to prosper, the following requisites must concur: 1) there must
PCFI sought for the immediate refund by Meralco to its customers of all the savings it realized be a final judgment or order; 2) the court rendering it must have jurisdiction over the
under P.D. No. 551, through the reduction of its franchise tax from 5% to 2%, with interest at subject matter and the parties; 3) it must be a judgment or order on the merits; and 4) there
the legal rate; and for the payment of damages and a fine in the amount of P50, 000.00 for must be, between the two cases identity of parties, subject matter and causes of action
violating P.D. 551
All the requisites are existent on the case.
Meralco alleged that it was duly authorized by BOE. Moreover, BoE affirmed that Meralco is
indeed authorized. .A judgment is on the merits when it determines the rights and liabilities of the parties
based on the disclosed facts, irrespective of formal, technical or dilatory objections.
It is at once evident from the foregoing controlling facts and
circumstances, particularly the Order of this Board dated March 10, 1980, as A lower court cannot reverse or set aside decisions or orders of a superior court, especially
confirmed by the reply-letter dated March 3, 1981, that Meralco has been duly of this Court, for to do so will negate the principle of hierarchy of courts and nullify the
authorized to retain the savings realized under the provisions of P.D. 551. The essence of review. A final judgment, albeit erroneous, is binding on the whole world.
authority granted in the said Order and letter is so clear and unequivocal as to leave Thus, it is the duty of the lower courts to obey the Decisions of this Court and render
any room for contradictory interpretation. This Board, therefore, holds as untenable obeisance to its status as the apex of the hierarchy of courts. "A becoming modesty of
petitioners claim that respondent Meralco was never authorized under the said Order inferior courts demands conscious realization of the position that they occupy in the
and letter to hold on to the savings realized under the said decree. interrelation and operation of the integrated judicial system of the nation."v "There is only
one Supreme Court from whose decisions all other courts should take their bearings," as
Four years thereafter, PCFI and a certain Edgardo S. Isip, private respondents herein, filed eloquently declared by Justice J. B. L. Reyes.
with respondent Regional Trial Court, Branch 76, Quezon City, a petition for declaratory
relief, docketed as Civil Case No. Q-89-3659.

respondent RTC rendered the assailed Decision declaring null and void the Resolution of
G.R. No. 180235, January 20, 2016 The RTC then issued its order dismissing the petition.

HON. MAYOR TOMAS R. OSMEÑA, IN HIS CAPACITY AS MAYOR OF CEBU, This CLOSURE ORDER precisely satisfies these legal precedents. Hence now, in view
AND TERESITA C. CAMARILLO, IN HER CAPACITY AS THE CITY whereof, your business establishment is hereby declared closed in direct contravention of
TREASURER, Respondents. the above-specified laws and city ordinances. Please cease and desist from further
operating your business immediately upon receipt of this order
Petitioner is a non-stock and non-profit corporation operating a golf course in Cebu City.
Whether or not the RTC judgment may be directly appealed to the SC via a petition
On June 21, 1993, the Sangguniang Panlungsod of Cebu City enacted City Tax Ordinance No. for review on certiorari
LXIX, otherwise known as the "Revised Omnibus Tax Ordinance of the City of Cebu"
(Revised Omnibus Tax Ordinance). RULING:
Section 42 of the said tax ordinance on amusement tax was amended by City Tax Ordinance
Nos. LXXXII4 and LXXXIV5 (which were enacted by the Sangguniang Panlungsod of Cebu The RTC judgment on pure
City on December 2, 1996 and April 20, 1998, respectively6) to read as follows: questions of law may be directly
appealed to this Court via a petition
for review on certiorari.
Section 42. Rate of Tax. - There shall be paid to the Office of the City Treasurer by the
proprietors, lessees or operators of theaters, cinemas, concert halls, circuses and other Even before the RTC, the parties already acknowledged that the case between them involved
similar places of entertainment, an amusement tax at the rate of thirty percent (30%), golf only questions of law; hence, they no longer presented evidence and agreed to submit the case
courses and polo grounds at the rate of twenty percent (20%), of their gross receipts for resolution upon submission of their respective memorandum.
on entrance, playing green, and/or admission fees
It is incontestable that petitioner may directly appeal to this Court from the judgment of the
In an Assessment Sheet7 dated August 6, 1998, prepared by Cebu City Assessor Sandra I. RTC on pure questions of law via its Petition for Review on Certiorari. Rule 41, Section 2(c)
Po, petitioner was originally assessed deficiency business taxes, fees, and other charges of the Rules of Court provides that "[i]n all cases where only questions of law are raised or
for the year 1998, in the total amount of P3,820,095.68, which included amusement tax involved, the appeal shall be to the Supreme Court by petition for review on certiorari in
on its golf course amounting to P2,612,961.24 based on gross receipts of accordance with Rule 45." As the Court declared in Bonifacio v. Regional Trial Court of
P13,064,806.20.8chanroblesvirtuallawlibrary Makati, Branch 14930:
The established policy of strict observance of the judicial hierarchy of courts, as a rule,
Through the succeeding years, respondent Cebu City repeatedly attempted to collect from requires that recourse must first be made to the lower-ranked court exercising concurrent
petitioner its deficiency business taxes, fees, and charges for 1998, a substantial portion jurisdiction with a higher court. A regard for judicial hierarchy clearly indicates that petitions
of which consisted of the amusement tax on the golf course. Petitioner steadfastly refused for the issuance of extraordinary writs against first level courts should be filed in the RTC and
to pay the amusement tax arguing that the imposition of said tax by Section 42 of the those against the latter should be filed in the Court of Appeals. The rule is not iron-clad,
Revised Omnibus Tax Ordinance, as amended, was irregular, improper, and illegal. however, as it admits of certain exceptions.
Petitioner reasoned that under the Local Government Code, amusement tax can only be
imposed on operators of theaters, cinemas, concert halls, or places where one seeks to Thus, a strict application of the rule is unnecessary when cases brought before the appellate
entertain himself by seeing or viewing a show or performance courts do not involve factual but purely legal questions. (Citations omitted.)

For failure to heed the demand of the City of Treasurer of Cebu City, on January 12, 2006,
petitioner was served with a Closure Order issued by respondent City Mayor Osmena due "A question of law exists when the doubt or controversy concerns the correct application
to operating a business without a business permit, non-payment of deficiencies on of law or jurisprudence to a certain set of facts; or when the issue does not call for an
Business taxes and Amusement Tax. The foregoing developments prompted petitioner to examination of the probative value of the evidence presented, the truth or falsehood of
file with the RTC on January 13, 2006 a Petition for Injunction, Prohibition, Mandamus, facts being admitted[;]" and it may be brought directly before this Court, the undisputed
Declaration of Nullity of Closure Order, Declaration of Nullity of Assessment, and final arbiter of all questions of law.31chanroblesvirtuallawlibrary
Declaration of Nullity of Section 42 of Cebu City Tax Ordinance, with Prayer for
Temporary Restraining Order and Writ of Preliminary Injunction, against respondents.
The availment of administrative remedy entails lesser expenses and provides for a speedier Similar to Ongsuco and CEPALCO, the case at bar constitutes an exception to the general
disposition of controversies. Furthermore, the courts of justice, for reasons of comity and rule. Not only does the instant Petition raise pure questions of law, but it also involves
convenience, will shy away from a dispute until the system of administrative redress has been substantive matters imperative for the Court to resolve.
completed and complied with, so as to give the administrative agency concerned every
opportunity to correct its error and dispose of the case. However, there are several exceptions
to this rule. G.R. No. 79886 November 22, 1989
The rule on the exhaustion of administrative remedies is intended to preclude a court from vs.
arrogating unto itself the authority to resolve a controversy, the jurisdiction over which is ROYAL CLASS LIMOUSINE SERVICE, LAND TRANSPORTATION
initially lodged with an administrative body of special competence. Thus, a case where the COMMISSION, COURT OF APPEALS, respondents.
issue raised is a purely legal question, well within the competence; and the jurisdiction of G.R. No. 79887 November 22, 1989
the court and not the administrative agency, would clearly constitute an exception. QUALITRANS LIMOUSINE SERVICE, INC.,
Resolving questions of law, which involve the interpretation and application of laws, vs.
constitutes essentially an exercise of judicial power that is exclusively allocated to the ROYAL CLASS LIMOUSINE SERVICE, JUDGE PERPETUA COLOMA, and
Supreme Court and such lower courts the Legislature may establish. COURT OF APPEALS, respondents.
In this case, the parties are not disputing any factual matter on which they still need to FACTS:
present evidence. The sole issue petitioners raised before the RTC in Civil Case No. 25843
was whether Municipal Ordinance No. 98-01 was valid and enforceable despite the absence,
prior to its enactment, of a public hearing held in accordance with Article 276 of the On June 22, 1982, the then Board of Transportation, now the Land
Implementing Rules and Regulations of the Local Government Code. This is undoubtedly a Transportation Commission, rendered a Decision granting petitioner a
pure question of law, within the competence and jurisdiction of the RTC to resolve. certificate of public convenience to operate a garage (tourist) air-conditioned
service within the City of Manila and from said place to any point in Luzon, and
Paragraph 2(a) of Section 5, Article VIII of the Constitution, expressly establishes the vice-versa
appellate jurisdiction of this Court, and impliedly recognizes the original jurisdiction of lower
courts over cases involving the constitutionality or validity of an On June 25, 1982, said Decision was amended by converting petitioner's
ordinance:ChanRoblesVirtualawlibrary certificate of public convenience for garage service into one for limousine
Section 5. The Supreme Court shall have the following powers: tourist service for the transportation of all outgoing passengers of the Manila
International Airport
On October 14, 1985, a Deed of Absolute Sale was executed by private
(2) Review, revise, reverse, modify or affirm on appeal or certiorari, as the law or the Rules of respondent with Transcare, Inc., a duly licensed limousine service operator and
Court may provide, final judgments and orders of lower courts in: likewise, a holder of a certificate of public convenience By virtue of said sale,
the franchise granted to Transcare, Inc. for the use of 40 units of tourist cars
(a) All cases in which the constitutionality or validity of any treaty, international or was sold to private respondent.
executive agreement, law, presidential decree, proclamation, order, instruction, ordinance, or
regulation is in question.
On December 27, 1985, upon application filed for the approval of
In J.M. Tuason and Co., Inc. v. Court of Appeals, Ynot v. Intermediate Appellate Court, and aforementioned sale, an Order was issued by the Land Transportation
Commissioner of Internal Revenue v. Santos, the Court has affirmed the jurisdiction of the Commission granting a provisional permit in favor of private respondent
RTC to resolve questions of constitutionality and validity of laws (deemed to include local
ordinances) in the first instance, without deciding questions which pertain to legislative policy. within the New Manila International Airport and from said place to any
(Emphases supplied, citations omitted.) point in the Island of Luzon accessible to motor vehicle traffic and vice-
versa, involving the right to operate forty (40) units authorized therein.

In Cagayan Electric Power and Light Co., Inc. (CEPALCO) v. City of Cagayan De Oro,35
the Court initially conceded that as in Reyes, the failure of taxpayer CEPALCO to appeal On June 17, 1986, petitioner filed a motion for reconsideration before the Land
to the Secretary of Justice within the statutory period of 30 days from the effectivity of Transportation Commission to correct the route specified in the prefatory
the ordinance should have been fatal to its cause. However, the Court purposefully relaxed portion of its December 27, 1986
the application of the rules in view of the more substantive matters.
On September 1, 1986, petitioner filed Civil Case before the G.R. No. L-59070 March 15, 1982
Pasay City Regional Trial Court for damages with prayer for
issuance of a writ of mandatory injunction against private PHILIPPINE PACIFIC FISHING CO., INC., CHENG YONG, LILIA GAW and CHEN
respondent GUAT, petitioners,
RTC dismissed that case on the ground that the court does not have HON. ARTEMON D. LUNA, Judge of the Court of First Instance of Manila; YOSHIO
jurisdiction over the YAMAMOTO and MARILYN A. JAVIER, respondent.

Further, this Court doesn't have jurisdiction over this case under Sec. 19 BP
Blg. 129.
RTC shall have Exclusive jurisdiction.— SEC. 19, BP Blg. 129.
Petition for certiorari and prohibition to annul and set aside as acts in excess of jurisdiction
and or a abuse to discretion the order of respondent judge, which, briefly characterized,
ISSUE: amount to an assumption of jurisdiction by a Court of First Instance and its exercise of the
WON THE REGIONAL TRIAL COURT HAS JURISDICTION OVER THE CASE power to review actuations of the Securities and Exchange Commission. Notably, the
respondents have not filed any answer, required by the Court's resolution of December 16,

RULING: The background facts are simple. As alleged in The petition which be their very nature, and
because they are not denied anyway, respondents having failed to answer. The circumstances
NO, RTC does not have jurisdiction. that led to the filing of the instant recourse are:
As to claims that the Land Transportation Commission can not entertain suits for declaratory
relief, there is merit in the ruling under question to the effect that the Commission, under its 4.1. The Philippine Pacific Fishing Co., Inc. through its of. officers,
enabling law, Executive Order No. 1011, has ample powers to modify certificates of public Yoshio Yamamoto anterior Marilyn Javier, private respondents herein,
convenience, including the grant of latitudinarian franchises in favor of public utilities. We who are plaintiffs in Civil Case No. 144299, mortgaged to the Philippine
quote: Banking Corporation the fishing vessels, PACIFIC I and PACIFIC II, to
... The (Land Transportation) Commission shall have, among others, the secure payment of a debt. Upon default of the Philippine Pacific Fishing
following powers and functions: Co., Inc. to pay its debt, the Philippine Banking Corporation instituted
(a) Quasi-judicial powers and functions which require foreclosure proceedings and filed an action for replevin. To prevent the
notice and hearing— foreclosure, Yamamoto and/or Marilyn Javier, acting as officers of the
xxx xxx xxx corporation, made an agreement with Cheng Yong, one of the defendants
(2) To issue, amend, revise, suspend or cancel in the aforementioned Civil Case. Under the agreement, Cheng Yong paid
Certificates of Public Convenience or permits the indebtedness of Philippine Pacific Fishing to Philippine Banking
authorizing the operation of public land transportation Corporation, and in turn, Yamamoto and/or Javier, as officers of
services provided by motorized vehicles, and to Philippine Pacific Fishing executed a chattel mortgage of the two vessels
prescribe the appropriate terms and conditions in favor of Cheng Yong.
therefor; 6
xxx xxx xxx 4.2. Upon failure of Philippine Pacific to pay the debt, Cheng Yong
Royal Class' application is, quintessentially, a petition for an expanded route, over which the foreclosed the mortgage. Yamamoto and Javier then went to the Securities
Board exercises jurisdiction under its charter. and Exchange Commission and filed a complaint, alleging that the
The fact that Qualitrans had, meanwhile, commenced suit in the Regional Trial Court (RTC) controversy between Cheng Yong and Philippine Pacific was intra-
does not oust the Commission of its jurisdiction. The Commission had a primacy of authority corporate. (SEC Case No. 002042). The SEC restrained the foreclosure
to take cognizance of Royal Class 'inquiry. It is to be noted, indeed, that the very trial court, by proceedings and thereafter, the parties finally agreed to the formation of a
its order of September 8, 1986, 8 denied the issuance of preliminary injunctive relief sought by Management Committee, with powers among others, 'to take custody and
Qualitrans, in deference, precisely, to the Board's primal and preferential jurisdiction. possession of all assets, funds, properties and records of the corporation;
and 'to administer, manage and preserve such assets, funds and records.
Exercising said powers the Management Committee ordered Yamamoto
and Javier to deliver to the Committee vessels, PACIFIC I and PACIFIC petitioners from further proceeding with SEC Case No. 2042 and from
II; enforcing the aforesaid orders until further orders from the Court;

V. PERTINENT PROCEEDINGS 5.6. On November 10, 1981 petitioners Cheng Yong, Lilia Gaw and
Cheng Guat, who are some of the defendants named in the aforestated
5.1. On October 22, 1979 private respondents, through counsel, filed with Civil Case No. 144299, Court of First Instance of Manila, filed, through
the respondent court a complaint for declaration of rescission and counsel, a motion to dismiss the complaint, xerox copy of which is hereto
injunction, with ex-parte preliminary injunction docketed as Civil Case attached as Annex 'E' and an opposition to the issuance of a writ of
No. 144299, entitled 'Yoshio Yamamoto and Marilyn A. Javier, plaintiffs, preliminary injunction, xerox copy of which is hereto attached as Annex
versus, Securities and Exchange Commission, Jose Maria Hilado, 'F'
Philippine Pacific Fishing Co., Inc. Cheng Yong, Lilia Gaw and Cheng
Guat; xerox copy of said complaint is hereto attached as Annex 'B', 5.7. In his meantime the hearing of the application for issuance of a writ of
preliminary injunction which was originally set on November 6, 1981 was,
5.2. In their complaint, private respondents pray that upon filing of the upon motion of private respondents' counsel, postponed and reset to
complaint, a restraining order be issued ex-parte commanding the November 18, 1981, during which The parties were given a period of
defendants to desist from further proceeding in SEC Case No. 2042 and fifteen (15) days within which to simultaneously submit their respective
from enforcing the orders issued by the Securities and Exchange memorandum:
Commission under date of August 14, 1981, September 29, 1981 and
October 6, 1981; that thereafter, a writ of preliminary injunction be 5.8. On November 19, 1981, as aforesaid, the fourth floor of the City Hall
issued restraining the defendants, particularly the Securities and of Manila housing several salas of the Court of first Instance of Manila,
Exchange Commission, from enforcing and implementing the orders among which is the sala of Branch XXXII was burned and as
complained of and from disturbing or interfering in the exercise by consequence, the judicial records including those of the aforementioned
private respondent Yoshio Yamamoto of his rights to the ownership case was burned, hence, The proceedings in said case is ordered suspended
and possession of the two fishing vessels, PACIFIC I and PACIFIC II; pending the reconstitution of the judicial records. thereafter however
counsel for defendant Cheng Yong, Lilia Gaw and Cheng Guat in the
5.3. Likewise, private respondents pray that after hearing, private aforementioned Civil case No. L-44299 in the court below filed, through
respondent Yoshio Yamamoto be declared the lawful and absolute owner counsel, their memorandum, xerox copy of which is hereto attached as
of the aforementioned two fishing vessels; that all questioned orders of the Annex 'G' (Pp. 7-12, Record)
Securities and Exchange Commission be declared null and void and issued
without authority and jurisdiction and/or with grave abuse of discretion The order of herein respondent Judge being questioned reads thus:
that the defendants, particularly the Securities and Exchange Commission,
desist from questioning the herein private respondent Yoshio Yamamoto's This is a complaint for declaration of rescission and injunction, with
ownership and right of possession of the aforesaid two vessels and making prayer for issuance of a writ of preliminary injunction to restrain the
permanent such writ of preliminary injunction which it may have issued; Securities and Exchange Commission from further proceeding with SEC
Case No. 2042, entitled, 'YOSHIO YAMAMOTO and MARILYN A.
5.4. On the same date, private respondents filed an ex-parte motion for JAVIER vs. PHILIPPINE PACIFIC FISHING CO., INC., CHENG
resolution of the Executive Judge of the Court of First Instance of Manila, YONG, LILIA GAW, CHENG GUAT and the SHERIFF OF MANILA'
praying that an order be issued directing the Clerk of Court or his as well as from enforcing its Orders of August 14, September 29, and
authorized deputy to give due course to the complaint of the herein private October 6, 1981. Finding the complaint sufficient in form and substance,
respondents upon payment of the docket fee of P200.00 pursuant to par. defendants are required to show cause on November 6, 1981 at 8:30
10, Section 5 Rule 141 of the Rules of Court. Xerox copy of the motion is o'clock a.m. why the writ of preliminary injunction should not be issued.
hereto attached as Annex 'C'. Acting upon said motion, the aforementioned Let copies of this Order together with copies of the complaint be served
Executive Judge granted the same and ordered the Clerk of Court to accept upon the defendants at the expense of plaintiffs. Defendants are required
the filing of private respondents' complaint upon payment of docket fee in to answer the petition within ten (10) days from receipt of this Order.
the sum of P200.00. Xerox copy of the order is hereto attached as Annex
'D'; Meanwhile, the defendants are hereby restrained from further proceeding
with SEC. No. 2042 and from enforcing the aforesaid Orders until further
5.5. On October 26, 1981, the respondent judge issued the order orders from this Court.
complained of, copy of which is hereto attached as Annex 'A' restraining
the Securities and Exchange Commission, and Jose Maria Hilado, and the
Plaintiffs are hereby ordered to immediately file a bond of P20,000 to 4. to make such payments and disbursements in the ordinary course of
answer for any damages which respondents may sustain by reason of the business;
issuance of this Order, if the Court should finally decide that they are not
entitled thereto. 5. to keep and maintain proper accounting records of each and every
transaction of the company, particularly receipts and disbursements of
SO ORDERED. funds;

Manila, Philippines, October 26, 1981. (Page 22, Record) 6. to submit to this Commission a detailed report on all receipts and
disbursement of funds and such other reports as this Commission may
The orders of the Securities and Exchange Commission referred to in the above order are as require and
7. to acquire, lease, sell mortgage or otherwise encumber such assets with
ORDER the prior approval of this Commission.

After a careful study and review of the allegations of the separate motions filed by the The parties, petitioners as well as defendants shall turn over to the
respondents, both seeking to reconsider the Order of this Commission dated June 17, 1981 Commission all the assets, funds, properties and records of the corporation
denying the motion to dismiss and the opposition of petitioners thereto, this Hearing Officer in their possession including the vessels F/B Pacific I and II within five (5)
finds no compelling reason for disturbing the findings made in the Order sought to be days and to submit to the Commission within ten (10) days a complete
reconsidered, and thereto, said motions are hereby DENIED. inventory of all the assets, funds, properties and records of the corporation
which are in their possession, in the presence of the Chairman and the
members of the above committee
At the hearing on July 27, 1981, the motion of counsel for the respondent corporation
requiring the petitioners who are in possession of the fishing vessels F/B Pacific I and II, to
deliver said fishing vessels to the corporation was likewise considered. After considering the Until further orders from this Commission, said Committee created
manifestation and arguments of both parties and upon suggestion of this Hearing Officer, the pursuant to this Order shall have all the foregoing authorities and must
parties agreed that in lieu of the appointment of a receiver as prayed for by the petitioners in discharge all the functions pertaining thereto as well as to perform such
their motion of this Hearing Officer, the parties agreed that in lieu of the appointment of a other duties as may be necessary in order to protect the interest of the
receiver as prayed for by the petitioners in their motion to that effect and the delivery of the corporation.
fishing vessels to the corporation as requested by counsel for the respondent corporation, a
Management Committee be instead created. The petitioners and the respondents immediately The application of the petitioners for the provisional remedy of
nominated their representatives as members and the Chairman to be designated by the receivership is also hereby considered withdrawn.
As agreed upon by the parties, assisted by their respective counsels, a Management Committee
is hereby created and constituted to be composed of Mrs. Marilyn Javier and Mr. Melecio Mandaluyong, Metro Manila, August 14, 1981.
Hernandez as members with Atty. Felipe S. Tongco of this Commission as Chairman. The said
Committee, which shall at all times be under the control and supervision of this Commission
shall have the following powers, functions and duties, to wit: xxx xxx xxx

1. to take custody and possession of all assets, funds, properties and ORDER
records of the corporation and to prepare an inventory thereof;
Submitted for resolution is the manifestation and motion filed by the
2. to administer, manage and preserve such assets, funds and records; respondents to cite petitioners in contempt of this Commission and the
opposition thereto filed by petitioners.
3. to receive any and all amounts, sums or money due and owing to the
company and to deposit such amounts received in an appropriate bank for In a manifestation and motion filed before this Commission on September
and in the account of the corporation; 1, 1981, respondents alleged that in an order dated August 14, 1981,
issued by the Commission, the parties, petitioners and respondents, were
directed to turn over to the Management Committee formed thereat, all the
assets, funds, properties and records of the corporation which are in their Acting upon the urgent ex-parte motion of defendant corporation dated
possession, including the vessels F/B Pacific I and Pacific II within five October 6, 1981, and finding the same to be meritorious, said urgent ex-
(5) days and to submit to the Commission within ten (10) days, a complete parte motion is hereby GRANTED.
inventory of said assets, funds, properties and records of the corporation in
the presence of the Chairman and members of the Management WHEREFORE, the Chairman of the Management Committee or his duly
Committee; that more than five (5) days have elapsed since the receipt of authorized representative is hereby directed to take possession of the
the order of August 14, 1981 by the petitioners without the latter having fishing vessel, the PACIFIC II, wherever it may be found in Philippine
complied with the directive to deliver the aforesaid vessels to the waters and for the purpose, is hereby authorized 'to enlist the aid and
Commission; that each day of delay in the delivery of the possession of the support of any and all enforcement agencies of the government, civil or
aforestated vessel and. in the operation thereof by the Management military'. pursuant to Sec. 3 of Presidential Decree No. 902-A.
Committee, deprived the corporation of sizeable earnings out of said
vessels and that this failure of petitioners to comply with the Order, being
willful and deliberate, constitute contumacious acts punishable under the SO ORDERED.
New Rules of Procedure in the Securities and Exchange Commission.
Mandaluyong, Metro Manila, Philippines.
Petitioners, in opposing the motion for contempt, averred that they are not
in possession of assets, funds, properties and records of the corporation October 6, 1981. (Page 60, Record)
which to the best of their knowledge are in the possession of respondent
Cheng, that the fishing vessels F/B Pacific I and II are not assets of We are aware of the fact that up to the present respondent judge has not gone beyond issuing
respondent corporation, petitioner Yamamoto having rescinded the sale in the above restraining order, notably requiring the filing of a bond. What has happened with the
the exercise of his lien as an unpaid seller of the vessels and that petitioner motion for a writ of preliminary injunction is not in the record. But assuming respondents
Yamamoto is willing to consider arrangement whereby the vessels would should claim that the herein petition is premature considering there is no showing that
be operated under the supervision of the Management Committee for the respondent judge has not been asked to reconsider his impugned order and the incident on
benefit of all the parties concerned, the rescission the sale of the vessels the preliminary injunction has not been resolved. Our ready answer is that We have opted
notwithstanding. "Considering that one of the issues involved in this case to act now, for the simple reason that the invalidity of the challenged order is so manifest and
is the ownership of the two (2) vessels, we consider it quite impractical for patent, in fact and in law, that it would be a waste of time and actually an injustice to
the petitioners to capitalize on this issue to justify their inability to comply petitioners, if We delayed further disposition of the issues raised by them. We cannot imagine
with the Order of this Commission dated August 14, 1981. any different end result that subsequent actions of the parties or respondent judge could
possibly affect Our conclusion regarding the utter lack of jurisdiction of respondent judge in
Unless, therefore, prevented by any supervening events, petitioners are the premises.
duty bound to abide by the directive of this Commission for the delivery of
the two (2) fishing boats to the Management Committee. Viewed from this As already portrayed above, the parties came within the jurisdiction of the Securities and
perspective, we find petitioners' non-compliance with the Order of this Exchange Commission on the basis of the complaint of herein petitioners. They claimed their
Commission dated August 14, 1981 directing delivery of fishing boats P/B controversy with private respondents involved intra-corporate matters within the exclusive
Pacific I and II, which are admittedly in their (petitioners) possession, to jurisdiction of that body. The Commission took cognizance thereof, the parties discussed their
the Management Committee to be without any justifiable reason. respective positions before it, and on the issues joined by them, the Commission issued the
orders above-quoted.
WHEREFORE, petitioners are hereby found guilty of indirect contempt
and fine of P1,000 plus an additional fine of P200 for every day of delay If any or all of said orders are erroneous, the organic act creating the Commission, Presidential
in the delivery of said vessels or non-compliance with the order is hereby Decree 902-A, provides the appropriate remedy, first within the Commission itself, and
imposed upon them without prejudice to imprisonment in case petitioners ultimately in this Court. Nowhere does the law empower Court of First Instance to interfere
still fail to deliver the two (2) fishing boats within five (5) days from with the orders of the Commission. Not even on grounds of due process or jurisdiction. The
receipt of the Order. Commission is, conceding arguendo a possible claim of respondents, at the very least. a co-
equal body with the Courts of First Instance. Even as such co-equal, one would have no power
SO ORDERED. to control the other. But the truth of the matter is that only the Supreme Court can enjoy and
correct any actuation of the Commission. (Pineda vs. Lantin, 6 SCRA 757)
Mandaluyong, Metro Manila, September 29, 1981. (Pp. 57-59, Record)
Moreover, it is obvious that since the Commission has its offices outside of Manila, under
ORDER settled jurisprudence, a Manila court's writ of preliminary injunction. much less a restraining
order, can have no binding effect outside the Manila area.
IN VIEW OF ALL THE FOREGOING, judgment is hereby rendered setting aside the
impugned order of herein respondent judge and making the restraining order heretofore issued
by Us permanent. with costs against respondents.