SPOUSES ALFREDO and SHIRLEY YAP,Petitioners,

- versus -

INTERNATIONAL EXCHANGE BANK,[1] SHERIFF RENATO C. FLORA and/or OFFICE OF THE CLERK OF COURT, REGIONAL TRIAL COURT,MAKATI CITY,Respondents.

G.R. No. 175145

Present:AUSTRIA-MARTINEZ, J.,Acting Chairperson,TINGA,*CHICO-NAZARIO,NACHURA, andREYES, JJ.

Promulgated:

March 28, 2008x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

  

D E C I S I O N  CHICO-NAZARIO, J.:  

Before Us is a Petition for Review on Certiorari under Rule 45 of the 1997 Rules of Civil Procedure which seeks to set aside the Resolution[2] of the Court of Appeals in CA-G.R. SP No. 95074 dated 11 July 2006 which dismissed petitioner-spouses Alfredo and Shirley Yaps petition for certiorari which questioned the Order[3] of Branch 264 of the Regional Trial Court (RTC) of Pasig City in Civil Case No. 68088 recalling and dissolving the Writ of Preliminary Injunction dated 13 August 2001, and its Resolution[4] dated 9 October 2006 denying petitioners Motion for Reconsideration.

 The factual antecedents are as follows: Respondent International Exchange Bank (iBank, for

brevity) filed a collection suit with application for the issuance of a writ of preliminary attachment against Alberto Looyuko and Jimmy T. Go in the RTC of Makati. The case was raffled to Branch 150 and was docketed as Civil Case No. 98-791. On 7 October 1999, the trial court rendered a Decision in favor of respondent iBank and found Alberto Looyuko and Jimmy T. Go liable, ordering them to pay the amount of ninety-six million pesos (P96,000,000.00), plus penalty.

 A Writ of Execution on the judgment against Mr.

Looyuko was implemented. Thereafter, a Writ of Execution was issued against Mr. Go for his part of the liability. Thereupon, respondent Renato C. Flora, Sheriff of Branch 150 of the RTC of Makati City, issued a Notice of Sheriffs Sale on 12 May 2000 notifying all the parties concerned, as well as the public in general, that the following real properties, among other properties, covered by Transfer Certificates of Title (TCTs) No. PT-66751, No. PT-66749, No. 55469 and No. 45229 of the Registry of Deeds of Pasig City, TCT No. 36489 of the Registry of Quezon City, and TCTs No. 4621 and No. 52987 of the Registry of Deeds of Mandaluyong City, allegedly owned by Mr. Go will be sold at public auction on 15 June 2000.[5] Said public auction did not push through.

 On 13 June 2000, petitioner-spouses Alfredo and Shirley

Yap filed a Complaint for Injunction with Prayer for Temporary Restraining Order and/or Preliminary Injunction with the RTC of Pasig City. The case was docketed as Civil Case No. 67945 and was raffled to Branch 158 thereof. Petitioners sought to stop the

auction sale alleging that the properties covered by TCTs No. PT-66751, No. PT-66749, No. 55469 and No. 45229 of the Registry of Deeds of Pasig City, TCT No. 36489 of the Registry of Quezon City, and TCTs No. 4621 and No. 52987 of the Registry of Deeds of Mandaluyong City, are already owned by them by virtue of Deeds of Absolute Sale[6] executed by Jimmy Go in their favor. They further alleged that respondent sheriff disregarded their right over the properties despite their execution of an Affidavit of Adverse Claim to prove their claim over the properties and the publication of a Notice to the Public warning that various deeds had already been issued in their favor evidencing their right over the same.

 A second Notice of Sheriffs Sale dated 30 June 2000 was

issued by Sheriff Flora scheduling a public auction on 24 July 2000for the afore-mentioned properties. The public auction did not happen anew. Thereafter, a third Notice of Sheriffs Sale dated 21 July 2000 scheduling a public auction on 22 August 2000 was issued.

On 21 August 2000, the RTC of Pasig City, Branch 158, issued an Order in Civil Case No. 67945 denying petitioners application for a writ of preliminary injunction.[7]

As scheduled, the public auction took place on 22 August 2000 for which respondent sheriff issued a Certificate of Sale stating that the subject properties had been sold at public auction in favor of respondent iBank, subject to the third-party claims of petitioners.[8]

 Petitioners filed with the RTC of Pasig City the instant

case for Annulment of Sheriffs Auction Sale Proceedings and Certificate of Sale against iBank, the Clerk of Court and Ex-Officio Sheriff of RTC Makati City, and Sheriff Flora. The case was docketed as Civil Case No. 68088 and was raffled to Branch 264. The Complaint was amended to include a prayer for the issuance of a Temporary Restraining Order and/or Writ of Preliminary Injunction.[9]

 Engracio M. Escarias, Jr., Clerk of Court VII and Ex-

Officio Sheriff of RTC Makati City, filed his Answer while respondents iBank and Sheriff Flora filed an Omnibus Motion (Motion to Refer the Complaint to the Office of the Clerk of Court for Raffle in the Presence of Adverse Party and Motion to Dismiss) dated 17 October 2000.[10]

 In an Order dated 20 February 2001, Hon. Leoncio M.

Janolo, Jr. denied the Omnibus Motion for lack of merit.[11]Respondents iBank and Sheriff Flora filed a Motion for Reconsideration dated 26 February 2001.[12]

 A hearing was held on the application for preliminary

injunction. On 18 July 2001, an Order was issued by Judge Janolo granting petitioners application for issuance of a writ of preliminary injunction. The Order reads:

WHEREFORE, premises considered, plaintiffs application for issuance of a Writ of Preliminary Injunction is GRANTED, and defendants and their representatives are enjoined from proceeding further with the execution, including consolidating title and taking possession thereof, against plaintiffs real properties covered by Transfer Certificates of Title Nos. PT-66751, PT-66749, 55469, 45229, 4621, 52987 and 36489. The Writ of Preliminary Injunction shall be issued upon plaintiffs posting of a bond

Provisional Remedies Sections 6-9 1

executed to defendant in the amount of Three Million Pesos (P3,000,000.00) to the effect that plaintiffs will pay defendants all damages which the latter may sustain by reason of the injunction if it be ultimately decided that the injunction is unwarranted.[13]

  

On 13 August 2001, upon posting a bond in the amount of three million pesos (P3,000,000.00), Judge Janolo issued the Writ of Preliminary Injunction.[14]

 Respondents iBank and Sheriff Flora filed on 29 August 2001 a Motion for Reconsideration[15] of the order granting the Writ of Preliminary Injunction which the trial court denied in an Order dated 21 November 2001.[16]

 With the denial of their Motion for Reconsideration, respondents iBank and Sheriff Flora filed with the Court of Appeals a Petition for Certiorari, Prohibition and Mandamus with prayer for issuance of Temporary Restraining Order and/or Preliminary Injunction[17] praying that it: (a) issue immediately a temporary restraining order enjoining Judge Janolo from taking any action or conducting any further proceeding on the case; (b) annul the Orders dated 18 July 2001 and 21 November 2001; and (c) order the immediate dismissal of Civil Case No. 68088. In its decision dated 18 July 2003, the Court of Appeals dismissed the Petition.[18] It explained that no grave abuse of discretion was committed by Judge Janolo in promulgating the two Orders. It emphasized that its ruling only pertains to the propriety or impropriety of the issuance of the preliminary injunction and has no bearing on the main issues of the case which are still to be resolved on the merits. The Very Urgent Motion for Reconsideration filed by respondents iBank and Sheriff Flora was denied for lack of merit.[19]

 Respondents iBank and Sheriff Flora thereafter filed with this Court a Petition for Certiorari which we dismissed. The Courts Resolution dated 7 March 2005 reads: 

Considering the allegations, issues and arguments adduced in the petition for certiorari, the Court Resolves to DISMISS the petition for being a wrong remedy under the Rules and evidently used as a substitute for the lost remedy of appeal under Rule 45 of the 1997 Rules of Civil Procedure, as amended. Besides, even if treated as a petition under Rule 65 of the said Rules, the same would be dismissed for failure to sufficiently show that the questioned judgment is tainted with grave abuse of discretion.[20]

 Accordingly, an Entry of Judgment was issued by the Supreme Court certifying that the resolution dismissing the case had become final and executory on 30 July 2005.[21]

 Subsequently, respondents iBank and Sheriff Flora filed with the RTC of Pasig City, Branch 264, an Omnibus Motion (To Resolve Motion to Dismiss Complaint and/or Dissolve Injunction) dated 31 January 2006 praying that their pending Motion for Reconsideration dated 26 February 2001 which seeks for the dismissal of the case be resolved and/or the Writ of Preliminary Injunction previously issued be dissolved.[22]

 

On 9 February 2006, petitioners filed their Comment thereon with Motion to Cite in Contempt the counsel[23] of respondents. They pray that the pending Motion for Reconsideration be denied for being devoid of merit, and that the Motion to Dissolve Writ of Preliminary Injunction be also denied, it being a clear defiance of the directive of the Supreme Court which ruled with finality that the injunction issued by the trial court was providently issued and was not tainted with grave abuse of discretion.They further ask that respondents counsel be cited in contempt of court and be meted out the appropriate penalty.[24] Respondents filed a Reply dated 20 February 2006.

 In a Manifestation dated 24 March 2006, respondents

iBank and Sheriff Flora submitted an Affidavit of Merit to emphasize their resolve and willingness, among other things, to file a counter-bond to cover whatever damages petitioners may suffer should the trial court decide to dissolve the writ of preliminary injunction.[25] Petitioners filed a Counter-Manifestation with Second Motion to Cite Respondents Counsel in Direct Contempt of Court[26] to which respondents filed an Opposition.[27] Petitioners filed a Reply thereto.[28]

 In an Order[29] dated 29 April 2006, the trial court

recalled and dissolved the Writ of Preliminary Injunction dated 13 August 2001, and ordered respondents to post a counter-bond amounting to ten million pesos. It directed the Branch Clerk of Court to issue a Writ Dissolving Preliminary Injunction upon the filing and approval of the required counter-bond. The dispositive portion of the Order reads:

 WHEREFORE, this Courts writ of preliminary injunction dated August 13, 2001 is recalled and dissolved. Defendants are hereby ordered to post a counter-bond amounting to ten million pesos (P10,000,000.00) to cover the damages plaintiffs would incur should a favorable judgment be rendered them after trial on the merits. The Branch Clerk of Court is directed to issue a Writ Dissolving Preliminary Injunction upon the filing and approval of defendants counter-bond.[30]

The trial court explained its ruling in this wise: 

In our jurisdiction, the provisions of Rule 58 of the Revised Rules of Court allow the issuance of preliminary injunction. This court granted plaintiffs prayer preliminary injunction in the Order dated July 18, 2001 and the corresponding writ issued on August 13, 2001.

 Defendants in this case, however, are

not without remedy to pray for dissolution of preliminary injunction already granted because it is only interlocutory and not permanent in nature.

 The provisions of Section 6, Rule 58

of the Revised Rules of Court allow dissolution of the injunction granted provided there is affidavit of party or persons enjoined; an opportunity to oppose by the other party; hearing on the issue, and filing of a bond to be fixed by the court sufficient to compensate

Provisional Remedies Sections 6-9 2

damages applicant may suffer by dissolution thereby.

 A preliminary injunction is merely a

provisional remedy, an adjunct to the main case subject to the latters outcome. Its sole objective is to preserve the status quo until the trial court hears fully the merits of the case. The status quo is the last actual, peaceable and uncontested situation which precedes a controversy. The status quo should be that existing at the time of the filing of the case. A preliminary injunction should not establish new relations between the parties, but merely maintain or re-establish the pre-existing relationship between them. x x x.

 When the complainants right or title

is doubtful or disputed, he does not have a clear legal right and, therefore, the issuance of injunctive relief is not proper and constitutes grave abuse of discretion. x x x. In the case at bar, plaintiffs deed of sale was purported to be not duly notarized. As such, the legal right of what the plaintiffs claim is still doubtful and such legal right can only be threshed out in a full blown trial where they can clearly establish the right over the disputed properties.

 Moreover, defendants are willing to

post a counter bond which could cover up to the damages in favor of plaintiffs in case the judgment turns out to be adverse to them. Under the Rules of Civil Procedure, this is perfectly allowed and the dissolution of the writ of injunction can accordingly be issued. In the case of Lasala vs. Fernandez, the highest court has enunciated that a court has the power to recall or modify a writ of preliminary injunction previously issued by it. The issuance or recall of a preliminary writ of injunction is an interlocutory matter that remains at all times within the control of the court. (G.R. No. L-16628, May 23, 1962). The defendants had shown that dissolution of the writ of injunction is just and proper. It was duly shown that great and irreparable injury would severely cause the defendants if the writ of injunction shall continue to exist.[31]

  

On 5 May 2006, petitioners filed a Petition for Certiorari before the Court of Appeals asking that the trial courts Order dated 29 April 2006 be set aside.[32]

 During the pendency of the Petition for Certiorari, petitioners filed before the trial court a Very Urgent Motion to Suspend Proceedings[33] to which respondents filed a Comment.[34]

 On 11 July 2006, the Court of Appeals resolved to dismiss outright the Petition for Certiorari for failure of petitioners to file a motion for reconsideration of the Order dated 29 April 2006.[35] The Motion for Reconsideration[36] filed by petitioners was denied.[37]

 

After being granted an extension of thirty days within which to file a petition for certiorari, petitioners filed the instant Petition on14 December 2006. They made the following assignment of errors: 

I THE HONORABLE PUBLIC RESPONDENT JUDGE LEONCIO M. JANOLO, JR. GRAVELY ABUSED HIS DISCRETION TANTAMOUNT TO LACK OR EXCESS OF JURISDICTION IN DISSOLVING THE WRIT OF PRELIMINARY INJUNCTION DATED 13 AUGUST 2001. 1.                  DESPITE THE FACT THAT THE

COURT OF APPEALS RESOLVED WITH FINALITY THAT YOUR PERITIONERS WILL SUFFER IRREPARABLE INJURY (C.A.s emphasis) IF NO INJUNCTION IS ISSUED.

 2.                  DESPITE THE FACT THAT THE

HON. SUPREME COURT RULED WITH FINALITY THAT THE COURT A QUO DID NOT ABUSE ITS JURISDICTION WHEN IT ISSUED THE INJUNCTION DATED 13 AUGUST 2001, THUS, SUSTAINING THE REGULARITY OF THE WRIT OF PRELIMINARY INJUNCTION.

 II 

THE HONORABLE PUBLIC RESPONDENT JUDGE LEONCIO M. JANOLO, JR. GRAVELY ABUSED HIS DISCRETION TANTAMOUNT TO LACK OR EXCESS OF JURISDICTION BY FIXING THE PHP10,000,000.00 COUNTER-BOND DESPITE THE FACT THAT THE IRREPARABLE DAMAGE TO PETITIONERS AS A RESULT OF DISSOLVING THE WRIT OF PRELIMINARY INJUNCTION IS INCAPABLE OF PECUNIARY ESTIMATION OR COULD NOT BE QUANTIFIED. 

III 

THE HONORABLE COURT OF APPEALS ERRED AND GRAVELY ABUSED ITS DISCRETION IN OUTRIGHTLY DISMISSING YOUR PETITIONERS PETITION FOR CERTIORARI IN CA-GR SP NO. 95074, AS IT FAILED TO APPLY EXISTING JURISPRUDENCE TO THE EFFECT THAT A MOTION FOR RECONSIDERATION MAY BE DISPENSED WITH WHERE THE CONTROVERTED ACT IS PATENTLY ILLEGAL OR WAS PERFORMED WITHOUT JURISDICTION OR IN EXCESS OF JURISDICTION AS HELD IN HAMILTON VS. LEVY, (344 SCRA 821) 

IV 

THE HONORABLE COURT OF APPEALS LIKEWISE ERRED AND GRAVELY ABUSED ITS

Provisional Remedies Sections 6-9 3

DISCRETION WHEN IT DENIED PETITIONERS MOTION FOR RECONSIDERATION CLEARLY POINTING OUT TO THE COURT THAT AS AN EXCEPTION TO THE RULE, THE REQUIRED MOTION FOR RECONSIDERATION MAY BE DISPENSED WITH. At the outset, it must be said that the Writ of

Preliminary Injunction dated 13 August 2001 issued by the trial court has not yet been actually dissolved because respondents have not posted the required counter-bond in the amount of P10,000,000.00. The dissolution thereof is primed on the filing of the counter-bond.

 Petitioners argue that the trial court abused its

discretion when it ordered the dissolution of the Writ of Preliminary Injunction, the propriety of its issuance having been affirmed by both the Court of Appeals and the Supreme Court. There being an Order by this Court that the injunction issued by the trial court was not tainted with grave abuse of discretion, the dissolution of said writ is a clear defiance of this Courts directive.

 Respondents, on the other hand, contend that the trial

court has the authority and prerogative to set aside the Writ of Preliminary Injunction. They add that since petitioners Deed of Sale was not duly notarized, the latters application for preliminary injunction is devoid of factual and legal bases. They assert that, not being public documents, the subject deeds of sale are nothing but spurious, if not falsified, documents. They add that the continuance of the Writ of Preliminary Injunction would cause them irreparable damage because it continues to incur damage not only for the nonpayment of the judgment award (in Civil Case No. 98-791 before the RTC of Makati City, Br. 150), but also for opportunity losses resulting from the continued denial of its right to consolidate title over the levied properties.

 There is no dispute that both the Court of Appeals and

this Court have ruled that the issuance of the Writ of Preliminary Injunction by the trial court was not tainted with grave abuse of discretion. Respondents tried to undo the issuance of said writ but to no avail. The Resolution on the matter attained finality on 30 July 2005 and an entry of judgment was made.

 This, notwithstanding, respondents filed with the RTC

of Pasig City, Branch 264, an Omnibus Motion (To Resolve Motion to Dismiss Complaint and/or Dissolve Injunction) dated 31 January 2006 praying that their Motion for Reconsideration dated 26 February 2001 of the trial courts denial of their Motion to Dismiss which the trial court failed to resolve, be resolved and/or the Writ of Preliminary Injunction previously issued be dissolved. With this Omnibus Motion, the trial court issued the Order dated 13 August 2001 recalling and dissolving the Writ of Preliminary Injunction conditioned on the filing of a P10,000,000.00 counter-bond.

 The question is: Under the circumstances obtaining in

this case, may the trial court recall and dissolve the preliminary injunction it issued despite the rulings of the Court of Appeals and by this Court that its issuance was not tainted with grave abuse of discretion?

 We hold that the trial court may still order the

dissolution of the preliminary injunction it previously issued. We do not agree with petitioners argument that the trial court may no longer dissolve the preliminary injunction because this Court

previously ruled that its issuance was not tainted with grave abuse of discretion.

 The issuance of a preliminary injunction is different

from its dissolution. Its issuance is governed by Section 3,[38] Rule 58 of the 1997 Rules of Civil Procedure while the grounds for its dissolution are contained in Section 6, Rule 58 of the 1997 Rules of Civil Procedure. As long as the party seeking the dissolution of the preliminary injunction can prove the presence of any of the grounds for its dissolution, same may be dissolved notwithstanding that this Court previously ruled that its issuance was not tainted with grave abuse of discretion.

Section 6 of Rule 58 reads: 

Section 6. Grounds for objection to, or for motion of dissolution of, injunction or restraining order. The application for injunction or restraining order may be denied, upon a showing of its insufficiency. The injunction or restraining order may also be denied, or, if granted, may be dissolved, on other grounds upon affidavits of the party or person enjoined, which may be opposed by the applicant also by affidavits. It may further be denied, or, if granted, may be dissolved, if it appears after hearing that although the applicant is entitled to the injunction or restraining order, the issuance or continuance thereof, as the case may be, would cause irreparable damage to the party or person enjoined while the applicant can be fully compensated for such damages as he may suffer, and the former files a bond in an amount fixed by the court conditioned that he will pay all damages which the applicant may suffer by the denial or the dissolution of the injunction or restraining order. If it appears that the extent of the preliminary injunction or restraining order granted is too great, it may be modified.

 Under the afore-quoted section, a preliminary

injunction may be dissolved if it appears after hearing that although the applicant is entitled to the injunction or restraining order, the issuance or continuance thereof, as the case may be, would cause irreparable damage to the party or person enjoined while the applicant can be fully compensated for such damages as he may suffer, and the former files a bond in an amount fixed by the court on condition that he will pay all damages which the applicant may suffer by the denial or the dissolution of the injunction or restraining order. Two conditions must concur: first, the court in the exercise of its discretion, finds that the continuance of the injunction would cause great damage to the defendant, while the plaintiff can be fully compensated for such damages as he may suffer; second, the defendant files a counter-bond.[39] The Order of the trial court dated29 April 2006 is based on this ground.

 In the case at bar, the trial court, after hearing, found

that respondents duly showed that they would suffer great and irreparable injury if the injunction shall continue to exist. As to the second condition, the trial court likewise found that respondents were willing to post a counter-bond which could cover the damages that petitioners may suffer in case the judgment turns out to be adverse to them. The Order of the trial court to recall and dissolve the preliminary injunction is subject

Provisional Remedies Sections 6-9 4

to the filing and approval of the counter-bond that it ordered. Failure to post the required counter-bond will necessarily lead to the non-dissolution of the preliminary injunction. The Order of Dissolution cannot be implemented until and unless the required counter-bond has been posted.

 The well-known rule is that the matter of issuance of a

writ of preliminary injunction is addressed to the sound judicial discretion of the trial court, and its action shall not be disturbed on appeal unless it is demonstrated that it acted without jurisdiction or in excess of jurisdiction or, otherwise, in grave abuse of discretion. By the same token, the court that issued such a preliminary relief may recall or dissolve the writ as the circumstances may warrant.[40] In the case on hand, the trial court issued the order of dissolution on a ground provided for by the Rules of Court. The same being in accordance with the rules, we find no reason to disturb the same.

 Petitioners contend that the Court of Appeals erred and

gravely abused its discretion when it dismissed outright their Petition for Certiorari by failing to apply existing jurisprudence that a motion for reconsideration may be dispensed with where the controverted act is patently illegal or was performed without jurisdiction or in excess of jurisdiction. On the other hand, respondents urge the Court to deny the Petition for Review, arguing that the Court of Appeals properly applied the general rule that the filing of a motion for reconsideration is a condition sine qua non in order that certiorari will lie.

 We find petitioners contention to be untenable. The rule is well settled that the filing of a motion for

reconsideration is an indispensable condition to the filing of a special civil action for certiorari.[41]  It must be stressed that a petition for certiorari is an extraordinary remedy and should be filed only as a last resort. The filing of a motion for reconsideration is intended to afford the trial court an opportunity to correct any actual error attributed to it by way of re-examination of the legal and factual issues.[42] By their failure to file a motion for reconsideration, they deprived the trial court of the opportunity to rectify any error it committed, if there was any.

Moreover, a perusal of petitioners petition for certiorari filed with the Court of Appeals shows that they filed the same because there was no appeal, or any plain, speedy and adequate remedy in the course of law except via a petition for certiorari.When same was dismissed by the Court of Appeals for failure to file a motion for reconsideration of the trial courts Order, they argue that while the filing of a motion for reconsideration is a sine qua non before a petition for certiorari is instituted, the same is not entirely without exception like where the controverted act is patently illegal or was performed without jurisdiction or in excess of jurisdiction. It was only when the Court of Appeals dismissed their Petition did they argue that exceptions to the general rule should apply. Their invocation of the application of the exceptions was belatedly made. The application of the exceptions should be raised in their Petition for Certiorari and not when their Petition has already been dismissed. They must give their reasons and explain fully why their case falls under any of the exceptions. This, petitioners failed to do.

Petitioners argument that they filed the Petition for Certiorari without filing a motion for reconsideration because there is no appeal, or any plain, speedy and adequate remedy in the course of law except via a Petition for Certiorari does not convince. We have held that the plain and adequate remedy

referred to in Section 1, Rule 65 of the Rules of Court is a motion for reconsideration of the assailed Order or Resolution.[43] The mere allegation that there is no appeal, or any plain, speedy and adequate remedy is not one of the exceptions to the rule that a motion for reconsideration is a sine qua non before a petition for certiorari may be filed.

All told, we hold that the act of the trial court of issuing the Order dated 29 April 2006 was not patently illegal or performed without or in excess of jurisdiction. The Court of Appeals was correct in dismissing outright petitioners Petition for Certiorari for failing to file a motion for reconsideration of the trial courts Order.

 Our pronouncements in this case are confined only to

the issue of the dissolution of the preliminary injunction and will not apply to the merits of the case.

 WHEREFORE, all considered, the Petition is hereby

DENIED. The Resolutions of the Court of Appeals in CA-GR SP No. 95074 dated 11 July 2006 and 9 October 2006 are AFFIRMED. The Order dated 29 April 2006 of Branch 264 of the Regional Trial Court (RTC) of Pasig City in Civil Case No. 68088 recalling and dissolving the Writ of Preliminary Injunction dated 13 August 2001 is AFFIRMED. Upon the posting by respondents of the counter-bond required, the trial court is directed to issue the Writ Dissolving Preliminary Injunction. No costs.

SO ORDERED.

Provisional Remedies Sections 6-9 5

[G.R. No. 126462.February 5, 2003]

NATALIA REALTY vs. CA

FIRST DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated FEB 5 2003.

G.R. No. 126462(Natalia Realty, Inc. vs. Court of Appeals, et al.)

Before the Court are two motions filed by private respondents: (1) Motion for Execution Against TRO Bond (Manager's Check) and (2) Manifestation with Motion for Entry of Judgment.

On November 12, 2002, the Court dismissed the petition for certiorari filed by Natalia Realty, Inc. ("petitioner" for brevity) against Antonio Martinez, Felipe Padua, Mario Perfecto and Hermito Salodega ("private respondents" for brevity). The dispositive portion of the decision reads:

"WHEREFORE, the petition is DISMISSED. The Regional Trial Court of Antipolo, Rizal, Branch 74, shall forthwith issue and cause to be immediately enforced an ALIAS WRIT OF EXECUTION of the Order of August 3, 1995 granting possession to private respondents of portions of the parcels of land covered by TCT Nos. 31527 and 31528 (now No. N-67845). This decision is immediately executory. The Clerk of Court is directed to remand the records of the case to the court of origin.

Costs against petitioner.

SO ORDERED."

On November 28, 2002, private respondents filed a "Motion for Execution Against TRO Bond (Manager's Check)". In their motion, private respondents point out that to secure the issuance of a temporary restraining order, petitioner posted with the Court a Manager's Check of BPI-Family Bank, Taytay Branch, dated February 27, 1997 in the amount of P100,000.00. Petitioner posted the cash bond pursuant to the March 3, 1997 Resolution of the Court granting the motion of petitioner to file a cash bond. The pertinent portion of the Court's resolution reads:

"The motion of the petitioner dated February 25, 1997 to file a cash bond in lieu of the supersedeas bond issued by Mercantile Insurance Company which petitioner filed on October 29, 1996 in order to expedite the issuance of a temporary restraining order in this case and submitting a Manager's Check in the amount of P100,000.00 issued by the BPI-Family Bank, Taytay Branch, is GRANTED. As prayed for, let a TEMPORARY RESTRAINING ORDER ISSUE enjoining the respondents from enforcing the Court of Appeals' questioned resolutions promulgated on June 27, 1995 and June 19, 1996 in CA-G.R. CV No. 44915 entitled "Natalia Realty, Inc. vs. Antonio Martinez, et al."

In view of the November 12, 2002 Decision of the Court dismissing the instant petition, private respondents pray that the

bond posted by petitioner with the Court, in the amount of P100,000.00, be executed on and released in private respondents' favor.

On December 16, 2002, the Court required petitioner to file its Comment.

Petitioner filed its "Opposition to Motion of Ceferino Padua To Have Manager's Check of P100,000.00 Be Released In Favor of Respondents" arguing for the denial of the motion of private respondents. Petitioner contends that the manager's check deposited by it should be applied to the satisfaction of any judgment rendered in favor of private respondents, and after satisfying the judgment, the balance should be refunded to it. Petitioner insists that a hearing should be conducted to determine the extent of the damage suffered by private respondents. Petitioner invokes Section 18 of Rule 57 of the Rules of Court.The provision reads:

"Sec. 18. Disposition of money deposited.- Where the party against whom attachment had been issued has deposited money instead of giving counter-bond, it shall be applied under the direction of the court to the satisfaction of any judgment rendered in favor of the attaching party, and after satisfying the judgment the balance shall be rendered to the depositor or his assignee. If the judgment is in favor of the party against whom attachment was issued, the whole sum deposited must be refunded to him or his assignee."

On January 13, 2003, private respondents filed a "Manifestation with Motion for Entry of Judgment". Private respondents bewail the fact that the Regional Trial Court could not act on their motion for execution of the Decision of the Court dated November 12, 2002 because the records of the case have not been remanded to it. Private respondents manifest that they are now far more interested in forthwith executing the decision of the Court granting them possession of the parcels of land covered by TCT Nos. 31527 and 31528 instead of pursuing execution on the bond. Private respondents would rather withdraw their Motion for Execution Against TRO Bond (Manager's Check) if the motion would only pose as an obstacle to an immediate execution of the Court's decision. To expedite the execution of the decision, private respondents pray for the issuance of an entry of judgment since petitioner did not file a motion for reconsideration of said decision. Private respondents believe that an entry of judgment is in order even while the Motion for Execution Against TRO Bond (Manager's Check) is pending before the Court.

The Court resolves to reiterate its declaration in its Decision dated November 12, 2002 that said decision is immediately executory. The Court also resolves to refer private respondents' Motion for Execution Against TRO Bond (Manager's Check) to the Regional Trial Court so that it could hear private respondents' claim for damages.

Section 1 of Rule 39 of the Rules of Court provides that before a writ of execution could issue, the judgment obligee must first apply for execution with the court of origin and with notice to the adverse party. Together with the motion, the judgment obligee must submit (1) certified true copies of the judgment or judgments or final order or orders sought to be enforced and (2) the entry of such judgment or final order.[1]cralawAn entry of

Provisional Remedies Sections 6-9 6

judgment is thus generally required before a writ of execution could issue. However, where the judgment or final order or resolution, or a portion thereof is ordered to be immediately executory, an entry of judgment is no longer necessary.[2]cralawSection 11 of Rule 51 of the Rules of Court clearly provides:

"Sec.11- Except where the judgment or final order or resolution, or a portion thereof, is ordered to be immediately executory, the motion for its execution may only be filed in the proper court after its entry."

To avoid unnecessary delays and to prevent the losing party from thwarting execution, the 1997 Rules of Court has abandoned the requirement that a court must await the return of the records before it could effect execution.[3]cralawThe Regional Trial Court, the court of origin in this case, has therefore no reason to deny or delay the enforcement of execution just because the records of the case have yet to be remanded to it.

For as long as private respondents have on motion applied for a writ of execution with notice to the adverse party and submitted certified true copies of the judgment or final orders sought to be enforced, the Regional Trial Court should posthaste comply with the Court's directive. In its November 12, 2002 Decision, the Court emphatically orders the Regional Court to "forthwith issue and cause to be immediately enforced an ALIAS WRIT OF EXECUTION of the Order of August 3, 1995 granting possession to private respondents of portions of the parcels of land covered by TCT Nos. 31527 and 31528 (now No. N-67845). This decision is immediately executory." To repeat, the absence of the records and entry of judgment should not be an excuse in delaying the execution of the Court's decision and which decision the Court declares to be "immediately executory".

With respect to private respondents' Motion for Execution Against TRO Bond (Manager's Check), the trial court is directed to hear private respondents' application for damages pursuant to Section 20, Rule 57 of the Rules of Court.

The applicable provision to private respondents' claim for damages on the bond is Section 8 of Rule 58 of the Rules of Court. It states that the "amount of damages to be awarded to either party, upon the bond of the adverse party shall be claimed, ascertained, and awarded under the same procedure prescribed in Section 20 of Rule 57." The pertinent portion of Section 20, Rule 57 in turn provides:

"xxx

If the judgment of the appellate court be favorable to the party against whom the attachment was issued, he must claim damages sustained during the pendency of the appeal by filing an application in the appellate court, with notice to the party in whose favor the attachment was issued or his surety or sureties, before the judgment of the appellate court becomes executory. The appellate court may allow the application to be heard and decided by the trial court.

xxx"

In cases where injunction or a temporary restraining order is issued, the damages that the other party may suffer by reason of

the writ are recoverable from the bond.[4]cralawThe Court has ruled inSocorro v. Aquino[5]cralaw that the dissolution of the injunction even if the injunction was obtained in good faith amounts to a determination that the injunction was wrongly obtained and a right of action on the injunction bond immediately accrues to the defendant. The dismissal of the petition in this case resulted in the dissolution of the temporary restraining order, conferring on private respondents a right of action on the injunctive bond.

Thus, the Regional Trial Court is instructed to hear and decide private respondents' Motion for Execution Against TRO Bond (Manager's Check) to determine the extent of damages sustained by private respondents.[6]cralaw The hearing on private respondents' application for damages against theP100,000.00 bond posted by petitioner should not in anyway hinder the prompt execution of the order of the Court for the immediate execution of its November 12, 2002 Decision.

WHEREFORE, the Regional Trial Court of Antipolo, Rizal, Branch 74, is ordered to forthwith issue and cause to be immediately enforced an ALIAS WRIT OF EXECUTION of the Order of August 3, 1995 granting possession to private respondents of portions of the parcels of land covered by TCT Nos. 31527 and 31528 (now No. N-67845). The Motion for Execution Against TRO Bond (Manager's Check) of private respondents is REFERRED to the same court so that it could hear and decide the claim for damages pursuant to Section 20, Rule 57 of the Rules of Court.

Provisional Remedies Sections 6-9 7

[G.R. No. 149758. September 25, 2006]

PHILEX GOLD PHILIPPINES, INC., et al. vs. PHILEX BULAWAN SUPERVISORS UNION, REPRESENTED BY ITS PRESIDENT,

JOSE D. PAMPLIEGA

Special First Division

Sirs/Mesdames:

Quoted hereunder, for your information, is a resolution of this Court dated SEPT. 25, 2006.

G.R. No. 149758 (Philex Gold Philippines, Inc., et al. vs. Philex Bulawan Supervisors Union, represented by its President, Jose D. Pampliega)

For consideration of the Court are the following:

(a) Respondent's Ex Parte Motion to Withdraw Bond; and

(b) Petitioners' Opposition (to respondent's Ex Parte Motion to Withdraw Bond)

Respondent union was the sole and exclusive bargaining representative of all the supervisors of petitioner Philex Gold Philippines, Inc., a gold mining company with mine site at Vista Alegre, Nabulao, Sipalay, Negros Occidental. On July 2, 1997, respondent union entered into a collective bargaining agreement (CBA) with petitioners covering the period from August 1, 1996 to July 31, 2001. After the signing of the CBA, petitioners made the employees of Philex Mining Corp. from Padcal, Tuba, Benguet (referred to as the "ex-Padcal" supervisors) its regular supervisory employees effective July 1, 1997. As the ex-Padcal supervisors were maintained under a "confidential payroll" who receive a different set of benefits and higher salaries compared to the locally-hired supervisors (referred to as the local hires) of similar rank and classification and who perform parallel duties and functions, respondent union filed a complaint against petitioners seeking the payment of wage differentials and damages and the rectification of the discriminatory salary structure and benefits between the ex-Padcal supervisors and the local hires.

On January 14, 2000, the Voluntary Arbitrator rendered a decision in favor of respondent union and ordered petitioners, jointly and severally, to readjust the monthly rates of pay of the locally-hired supervisors (with the categories of S-1 to S-5 ranks) in the same level or amount as that of the ex-Padcal supervisors and to pay the wage differentials of the locally-hired supervisors. In his Resolution of February 29, 2000, the Voluntary Arbitrator clarified that there was no discrimination in the determination of the rates of pay of the supervisors, but increased by P800 a month the amount of wages of the local supervisors as their uniform wage increase effective October 1, 1999.

Respondent union then filed a petition for review in the Court of Appeals. In the decision of April 23, 2001, the Court of Appeals reversed and set aside the Resolution dated February 29, 2000 of the Voluntary Arbitrator and reinstated the Voluntary Arbitrator's decision dated January 14, 2000 with modification

that the adjustment of the monthly rates of pay of the locally-hired supervisors as well as their wage differential pay be made effective August 1, 1997 up to the finality of this decision. It also ordered that the case be remanded to the Voluntary Arbitrator for the proper computation of wage differential and attorney's fees.

Petitioners thus filed a petition for review on certiorari with this Court with prayer for the issuance of a temporary restraining order. After the petitioners posted a cash bond of P100,000, the Court issued a temporary restraining order enjoining the execution of the decision of the Court of Appeals dated April 23, 2001.

On August 25, 2005, the Court rendered a decision affirming the decision of the Court of Appeals and lifting the temporary restraining order it earlier issued. Applying the doctrine of "equal pay for equal work," the Court ruled that petitioner company and its corporate officers were guilty of discriminating the locally-hired supervisors of equal rank who performed the same kind of work as the ex-Padcal supervisors.

Petitioners moved for a partial reconsideration averring that it had sufficiently established that there was no discrimination. It argued that the ex-Padcal supervisors possessed the necessary experience, training, and skill in the underground mining method which they gained through lengthy service in the Padcal mines which used the same technology and that none of the locally-hired supervisors had undergone the same training. On November 14, 2005, the Court denied petitioners' motion for partial reconsideration.

On December 28, 2005, respondent union filed the present Ex-Parte Motion to Withdraw Bond seeking the release of the P100,000 bond posted by petitioners on the temporary restraining order which the Court earlier issued. Respondent claims that the P100,000 bond posted by petitioners should be released in favor of its employees who would have been earlier benefited by the supposed salary adjustments in the decision of the Court of Appeals had the execution thereof not been stayed for 4 years.

Petitioners counter that the temporary restraining order is intended to be a restraint only until the propriety of granting an injunction can be determined. Since Section 8, Rule 58 of the Rules of Court provides that the amount of damages to be awarded shall be claimed in the same proceeding, the absence of an award of damages by the Court's decision dated August 25, 2005 does not entitle the respondents to their claim for damages against the petitioners' bond. Petitioners conclude that since it failed to file an application for damages during the pendency of the appeal and before the decision became final and executory, respondent union is not entitled to withdraw the bond they had posted.

On the matter of preliminary injunction, Section 8, Rules 58 provides that:

SEC. 8. Judgment to include damages against party and sureties. - At the trial, the amount of damages to be awarded to either party, upon the bond of the adverse party, shall be claimed, ascertained,

Provisional Remedies Sections 6-9 8

and awarded under the same procedure prescribed in section 20 of Rule 57. (9a)

Correlatively, Section 20, Rule 57 thereof provides that:

SEC. 20. Claim for damages on account of improper, irregular or excessive attachment. - An application for damages on account of improper, irregular or excessive attachment must be filed before the trial or before appeal is perfected or before the judgment becomes executory, with due notice to the attaching party and his surety or sureties, setting forth the facts showing his right to damages and the amount thereof. Such damages may be awarded only after proper hearing and shall be included in the judgment on the main case.

If the judgment of the appellate court be favorable to the party against whom the attachment was issued, he must claim damages sustained during the pendency of the appeal by filing an application in the appellate court, with notice to the party in whose favor the attachment was issued or his surety or sureties, before the judgment of the appellate court becomes executory. The appellate court may allow the application to be heard and decided by the trial court.

Nothing herein contained shall prevent the party against whom the attachment was issued from recovering in the same action the damages awarded to him from any property of the attaching party not exempt from execution should the bond or deposit given the latter be insufficient or fail to fully satisfy the award. (20a)

While it may not have filed a claim for damages before the finality of the judgment of this Court, respondent union is nonetheless entitled to recover on the P100,000 bond posted by the petitioners. Respondent union's entitlement to the damages arises only after the finality of the decision of this Court, as it would be only then that it can be determined with certainty whether respondent union has incurred any damage as a result of the decision of the Court of Appeals dated April 23, 2001 being enjoined at the instance of petitioners. Verily, the Court (First Division) in a Resolution dated October 8, 2001 stated:

Considering the allegations contained, the issues and the arguments adduced in the petition for review on certiorari, with prayer for the issuance of a temporary restraining order and/or status quo order, of the decision of the Court of Appeals dated April 23, 2001, the Court Resolves, without giving due course to the petition, to require the respondents to COMMENT thereon, not to file a motion to dismiss, within ten (10) days from notice.

Acting on the prayer for issuance of temporary restraining order, the Court Resolves to issue a temporary restraining order enjoining the execution of the decision dated April 23, 2001 and resolution dated August 29, 2001 in CA-G.R. SP No. 57701 entitled "Philex Bulawan Supervisors Union, etc. vs. Philex Gold Philippines, Inc., et al." upon the petitioners' filing of a bond in the amount of One Hundred Thousand (P100,000.00) within a period of five (5) days from notice hereof otherwise this resolution shall be deemed to be no force and effect. Said bond shall answer for the payment to private respondent of any damages which it may incur by reason of the issuance of the temporary restraining order sought, if it should be finally adjudged that said petitioners

were not entitled thereto, effective upon approval by this Court of the bond to be posted.... (Emphasis supplied.)

Petitioners added that there will be no damage to respondent union and its members regarding the supposed salary adjustments mandated by the decision of the Court of Appeals since it may still claim the amounts awarded by the Court of Appeals. The fact that the entitlement of respondent union and its members to the salary adjustments pursuant to the decision of the Court of Appeals has been stalled by reason of the temporary restraining order issued constitutes the damage itself, thereby warranting the recovery on the bond in favor of respondent union.

WHEREFORE, in view of the foregoing, the Ex Parte Motion to Withdraw [and/or Recover on the] Bond filed by respondent Philex Bulawan Supervisors Union is GRANTED and the opposition thereto filed by petitioners Philex Gold Philippines, Inc. and its corporate officers is NOTED.

SO ORDERED.

Provisional Remedies Sections 6-9 9

[G.R. No. 115758. March 19, 2002]

ELIDAD C. KHO, doing business under the name and style of KEC COSMETICS LABORATORY, petitioner, vs. HON. COURT OF APPEALS, SUMMERVILLE GENERAL MERCHANDISING and COMPANY, and ANG TIAM CHAY, respondents.

D E C I S I O N

DE LEON, JR., J.:

Before us is a petition for review on certiorari of the Decision[1] dated May 24, 1993 of the Court of Appeals setting aside and declaring as null and void the Orders[2] dated February 10, 1992 and March 19, 1992 of the Regional Trial Court, Branch 90, of Quezon City granting the issuance of a writ of preliminary injunction.

The facts of the case are as follows:

On December 20, 1991, petitioner Elidad C. Kho filed a complaint for injunction and damages with a prayer for the issuance of a writ of preliminary injunction, docketed as Civil Case No. Q-91-10926, against the respondents Summerville General Merchandising and Company (Summerville, for brevity) and Ang Tiam Chay.

The petitioners complaint alleges that petitioner, doing business under the name and style of KEC Cosmetics Laboratory, is the registered owner of the copyrights Chin Chun Su and Oval Facial Cream Container/Case, as shown by Certificates of Copyright Registration No. 0-1358 and No. 0-3678; that she also has patent rights on Chin Chun Su & Device and Chin Chun Su for medicated cream after purchasing the same from Quintin Cheng, the registered owner thereof in the Supplemental Register of the Philippine Patent Office on February 7, 1980 under Registration Certificate No. 4529; that respondent Summerville advertised and sold petitioners cream products under the brand name Chin Chun Su, in similar containers that petitioner uses, thereby misleading the public, and resulting in the decline in the petitioners business sales and income; and, that the respondents should be enjoined from allegedly infringing on the copyrights and patents of the petitioner.

The respondents, on the other hand, alleged as their defense that Summerville is the exclusive and authorized importer, re-packer and distributor ofChin Chun Su products manufactured by Shun Yi Factory of Taiwan; that the said Taiwanese manufacturing company authorized Summerville to register its trade name Chin Chun Su Medicated Cream with the Philippine Patent Office and other appropriate governmental agencies; that KEC Cosmetics Laboratory of the petitioner obtained the copyrights through misrepresentation and falsification; and, that the authority of Quintin Cheng, assignee of the patent registration certificate, to distribute and market Chin Chun Su products in the Philippines had already been terminated by the said Taiwanese Manufacturing Company.

After due hearing on the application for preliminary injunction, the trial court granted the same in an Order dated February 10, 1992, the dispositive portion of which reads:

ACCORDINGLY, the application of plaintiff Elidad C. Kho, doing business under the style of KEC Cosmetic Laboratory, for preliminary injunction, is hereby granted. Consequentially, plaintiff is required to file with the Court a bond executed to

defendants in the amount of five hundred thousand pesos (P500,000.00) to the effect that plaintiff will pay to defendants all damages which defendants may sustain by reason of the injunction if the Court should finally decide that plaintiff is not entitled thereto.

SO ORDERED.[3]

The respondents moved for reconsideration but their motion for reconsideration was denied by the trial court in an Order dated March 19, 1992.[4]

On April 24, 1992, the respondents filed a petition for certiorari with the Court of Appeals, docketed as CA-G.R. SP No. 27803, praying for the nullification of the said writ of preliminary injunction issued by the trial court. After the respondents filed their reply and almost a month after petitioner submitted her comment, or on August 14 1992, the latter moved to dismiss the petition for violation of Supreme Court Circular No. 28-91, a circular prohibiting forum shopping. According to the petitioner, the respondents did not state the docket number of the civil case in the caption of their petition and, more significantly, they did not include therein a certificate of non-forum shopping. The respondents opposed the petition and submitted to the appellate court a certificate of non-forum shopping for their petition.

On May 24, 1993, the appellate court rendered a Decision in CA-G.R. SP No. 27803 ruling in favor of the respondents, the dispositive portion of which reads:

WHEREFORE, the petition is hereby given due course and the orders of respondent court dated February 10, 1992 and March 19, 1992 granting the writ of preliminary injunction and denying petitioners motion for reconsideration are hereby set aside and declared null and void. Respondent court is directed to forthwith proceed with the trial of Civil Case No. Q-91-10926 and resolve the issue raised by the parties on the merits.

SO ORDERED.[5]

In granting the petition, the appellate court ruled that:

The registration of the trademark or brandname Chin Chun Su by KEC with the supplemental register of the Bureau of Patents, Trademarks and Technology Transfer cannot be equated with registration in the principal register, which is duly protected by the Trademark Law.

xxx xxx xxx

As ratiocinated in La Chemise Lacoste, S.S. vs. Fernandez, 129 SCRA 373, 393:

Registration in the Supplemental Register, therefore, serves as notice that the registrant is using or has appropriated the trademark. By the very fact that the trademark cannot as yet be on guard and there are certain defects, some obstacles which the use must still overcome before he can claim legal ownership of the mark or ask the courts to vindicate his claims of an exclusive right to the use of the same. It would be deceptive for a party with nothing more than a registration in the Supplemental

Provisional Remedies Sections 6-9 10

Register to posture before courts of justice as if the registration is in the Principal Register.

The reliance of the private respondent on the last sentence of the Patent office action on application Serial No. 30954 that registrants is presumed to be the owner of the mark until after the registration is declared cancelled is, therefore, misplaced and grounded on shaky foundation. The supposed presumption not only runs counter to the precept embodied in Rule 124 of the Revised Rules of Practice before the Philippine Patent Office in Trademark Cases but considering all the facts ventilated before us in the four interrelated petitions involving the petitioner and the respondent, it is devoid of factual basis. As even in cases where presumption and precept may factually be reconciled, we have held that the presumption is rebuttable, not conclusive, (People v. Lim Hoa, G.R. No. L-10612, May 30, 1958, Unreported). One may be declared an unfair competitor even if his competing trademark is registered (Parke, Davis & Co. v. Kiu Foo & Co., et al., 60 Phil 928; La Yebana Co. v. chua Seco & Co., 14 Phil 534).[6]

The petitioner filed a motion for reconsideration. This she followed with several motions to declare respondents in contempt of court for publishing advertisements notifying the public of the promulgation of the assailed decision of the appellate court and stating that genuine Chin Chun Su products could be obtained only from Summerville General Merchandising and Co.

In the meantime, the trial court went on to hear petitioners complaint for final injunction and damages. On October 22, 1993, the trial court rendered a Decision[7] barring the petitioner from using the trademark Chin Chun Su and upholding the right of the respondents to use the same, but recognizing the copyright of the petitioner over the oval shaped container of her beauty cream. The trial court did not award damages and costs to any of the parties but to their respective counsels were awarded Seventy-Five Thousand Pesos (P75,000.00) each as attorneys fees. The petitioner duly appealed the said decision to the Court of Appeals.

On June 3, 1994, the Court of Appeals promulgated a Resolution[8] denying the petitioners motions for reconsideration and for contempt of court in CA-G.R. SP No. 27803.

Hence, this petition anchored on the following assignment of errors:

I

RESPONDENT HONORABLE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION IN FAILING TO RULE ON PETITIONERS MOTION TO DISMISS.

II

RESPONDENT HONORABLE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION IN REFUSING TO PROMPTLY RESOLVE PETITIONERS MOTION FOR RECONSIDERATION.

III

IN DELAYING THE RESOLUTION OF PETITIONERS MOTION FOR RECONSIDERATION, THE HONORABLE COURT OF APPEALS DENIED PETITIONERS RIGHT TO SEEK TIMELY APPELLATE RELIEF AND VIOLATED PETITIONERS RIGHT TO DUE PROCESS.

IV

RESPONDENT HONORABLE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION IN FAILING TO CITE THE PRIVATE RESPONDENTS IN CONTEMPT.[9]

The petitioner faults the appellate court for not dismissing the petition on the ground of violation of Supreme Court Circular No. 28-91. Also, the petitioner contends that the appellate court violated Section 6, Rule 9 of the Revised Internal Rules of the Court of Appeals when it failed to rule on her motion for reconsideration within ninety (90) days from the time it is submitted for resolution. The appellate court ruled only after the lapse of three hundred fifty-four (354) days, or on June 3, 1994. In delaying the resolution thereof, the appellate court denied the petitioners right to seek the timely appellate relief. Finally, petitioner describes as arbitrary the denial of her motions for contempt of court against the respondents.

We rule in favor of the respondents.

Pursuant to Section 1, Rule 58 of the Revised Rules of Civil Procedure, one of the grounds for the issuance of a writ of preliminary injunction is a proof that the applicant is entitled to the relief demanded, and the whole or part of such relief consists in restraining the commission or continuance of the act or acts complained of, either for a limited period or perpetually. Thus, a preliminary injunction order may be granted only when the application for the issuance of the same shows facts entitling the applicant to the relief demanded.[10] This is the reason why we have ruled that it must be shown that the invasion of the right sought to be protected is material and substantial, that the right of complainant is clear and unmistakable, and, that there is an urgent and paramount necessity for the writ to prevent serious damage.[11]

In the case at bar, the petitioner applied for the issuance of a preliminary injunctive order on the ground that she is entitled to the use of the trademark on Chin Chun Su and its container based on her copyright and patent over the same. We first find it appropriate to rule on whether the copyright and patent over the name and container of a beauty cream product would entitle the registrant to the use and ownership over the same to the exclusion of others.

Trademark, copyright and patents are different intellectual property rights that cannot be interchanged with one another. A trademark is any visible sign capable of distinguishing the goods (trademark) or services (service mark) of an enterprise and shall include a stamped or marked container of goods.[12] In relation thereto, a trade name means the name or designation identifying or distinguishing an enterprise.[13] Meanwhile, the scope of a copyright is confined to literary and artistic works which are original intellectual creations in the literary and artistic domain protected from the moment of their creation.[14] Patentable inventions, on the other hand, refer to any technical solution of a problem in any field of human activity which is new, involves an inventive step and is industrially applicable.[15]

Provisional Remedies Sections 6-9 11

Petitioner has no right to support her claim for the exclusive use of the subject trade name and its container. The name and container of a beauty cream product are proper subjects of a trademark inasmuch as the same falls squarely within its definition. In order to be entitled to exclusively use the same in the sale of the beauty cream product, the user must sufficiently prove that she registered or used it before anybody else did. The petitioners copyright and patent registration of the name and container would not guarantee her the right to the exclusive use of the same for the reason that they are not appropriate subjects of the said intellectual rights. Consequently, a preliminary injunction order cannot be issued for the reason that the petitioner has not proven that she has a clear right over the said name and container to the exclusion of others, not having proven that she has registered a trademark thereto or used the same before anyone did.

We cannot likewise overlook the decision of the trial court in the case for final injunction and damages. The dispositive portion of said decision held that the petitioner does not have trademark rights on the name and container of the beauty cream product. The said decision on the merits of the trial court rendered the issuance of the writ of a preliminary injunction moot and academic notwithstanding the fact that the same has been appealed in the Court of Appeals. This is supported by our ruling in La Vista Association, Inc. v. Court of Appeals[16], to wit:

Considering that preliminary injunction is a provisional remedy which may be granted at any time after the commencement of the action and before judgment when it is established that the plaintiff is entitled to the relief demanded and only when his complaint shows facts entitling such reliefs xxx and it appearing that the trial court had already granted the issuance of a final injunction in favor of petitioner in its decision rendered after trial on the merits xxx the Court resolved to Dismiss the instant petition having been rendered moot and academic. An injunction issued by the trial court after it has already made a clear pronouncement as to the plaintiffs right thereto, that is, after the same issue has been decided on the merits, the trial court having appreciated the evidence presented, is proper, notwithstanding the fact that the decision rendered is not yet final xxx. Being an ancillary remedy, the proceedings for preliminary injunction cannot stand separately or proceed independently of the decision rendered on the merit of the main case for injunction. The merit of the main case having been already determined in favor of the applicant, the preliminary determination of its non-existence ceases to have any force and effect. (italics supplied)

La Vista categorically pronounced that the issuance of a final injunction renders any question on the preliminary injunctive order moot and academic despite the fact that the decision granting a final injunction is pending appeal. Conversely, a decision denying the applicant-plaintiffs right to a final injunction, although appealed, renders moot and academic any objection to the prior dissolution of a writ of preliminary injunction.

The petitioner argues that the appellate court erred in not dismissing the petition for certiorari for non-compliance with the rule on forum shopping. We disagree. First, the petitioner improperly raised the technical objection of non-compliance with Supreme Court Circular No. 28-91 by filing a motion to dismiss the petition for certiorari filed in the appellate court. This is prohibited by Section 6, Rule 66 of the Revised Rules of Civil Procedure which provides that (I)n petitions for certiorari before the Supreme Court and the Court of Appeals, the provisions of

Section 2, Rule 56, shall be observed. Before giving due course thereto, the court may require the respondents to file their comment to, and not a motion to dismiss, the petition xxx (italics supplied). Secondly, the issue was raised one month after petitioner had filed her answer/comment and after private respondent had replied thereto. Under Section 1, Rule 16 of the Revised Rules of Civil Procedure, a motion to dismiss shall be filed within the time for but before filing the answer to the complaint or pleading asserting a claim. She therefore could no longer submit a motion to dismiss nor raise defenses and objections not included in the answer/comment she had earlier tendered. Thirdly, substantial justice and equity require this Court not to revive a dissolved writ of injunction in favor of a party without any legal right thereto merely on a technical infirmity. The granting of an injunctive writ based on a technical ground rather than compliance with the requisites for the issuance of the same is contrary to the primary objective of legal procedure which is to serve as a means to dispense justice to the deserving party.

The petitioner likewise contends that the appellate court unduly delayed the resolution of her motion for reconsideration. But we find that petitioner contributed to this delay when she filed successive contentious motions in the same proceeding, the last of which was on October 27, 1993, necessitating counter-manifestations from private respondents with the last one being filed on November 9, 1993. Nonetheless, it is well-settled that non-observance of the period for deciding cases or their incidents does not render such judgments ineffective or void.[17] With respect to the purported damages she suffered due to the alleged delay in resolving her motion for reconsideration, we find that the said issue has likewise been rendered moot and academic by our ruling that she has no right over the trademark and, consequently, to the issuance of a writ of preliminary injunction.

Finally, we rule that the Court of Appeals correctly denied the petitioners several motions for contempt of court. There is nothing contemptuous about the advertisements complained of which, as regards the proceedings in CA-G.R. SP No. 27803 merely announced in plain and straightforward language the promulgation of the assailed Decision of the appellate court. Moreover, pursuant to Section 4 of Rule 39 of the Revised Rules of Civil Procedure, the said decision nullifying the injunctive writ was immediately executory.

WHEREFORE, the petition is DENIED. The Decision and Resolution of the Court of Appeals dated May 24, 1993 and June 3, 1994, respectively, are hereby AFFIRMED. With costs against the petitioner.

SO ORDERED.

Provisional Remedies Sections 6-9 12

[A.M. No. MTJ-02-1453. April 29, 2003]

EDITHA PALMA GIL, complainant, vs. JUDGE FRANCISCO H. LOPEZ, JR., Municipal Circuit Trial Court, Lupon, Davao Oriental, respondent.

R E S O L U T I O N

YNARES-SANTIAGO, J.:

A magistrate should dispose of the courts business promptly and decide cases within the required periods. Delay in the disposition of cases erodes the faith and confidence of the public in the institution of justice, lowers its standards and brings them into disrepute. Every judge must cultivate a capacity for quick decision; he must not delay the judgment which a party justly deserves. The public trust reposed in a judges office imposes upon him the highest degree of responsibility to promptly administer justice.[1]

In an Affidavit-Complaint[2] dated October 30, 2001, complainant Editha Palma Gil charged respondent Judge Francisco H. Lopez, Jr. of the Municipal Circuit Trial Court of Lupon, Davao Oriental, with Manifest Bias and Partiality, Undue Delay in the Disposition of Case and Ignorance of the Law.

Complainant alleged that she is the defendant in Civil Case No. 1110 for Forcible Entry and Damages with Preliminary Prohibitory and Mandatory Injunction, entitled Carlos Palen, Sr., Plaintiff versus Editha Palma Gil, Defendant, pending before the sala of respondent judge; and that respondent failed to render judgment therein within the thirty-day period required by Rule 70, Section 11 of the 1997 Code of Civil Procedure. She further averred that on October 9, 2001, the plaintiff in the said case filed a motion for temporary restraining order, which respondent Judge granted on the same day, despite procedural defects therein such as the lack of a verification, bond, and service of summons, all in violation of Rule 58, Section 4 of the 1997 Rules of Civil Procedure. Complainant further assails the manner in which the temporary restraining order was implemented with the assistance of policemen.

In his Comment dated March 1, 2002, respondent judge denied that there was a deliberate and unreasonable delay in the resolution of Civil Case No. 1110. He alleged that aside from his court, he had to hear the cases in the municipal courts in Governor Generoso and San Isidro, Davao Oriental due to the inhibition of the presiding judges therein. Moreover, he alleged that the legal and factual issues raised in Civil Case No. 1110 are complicated. Anent the alleged issuance of a temporary restraining order, respondent claims that what he issued was a status quo order because complainants men entered the land in dispute and attempted to prevent the harvesting of palay by plaintiff.Finally, respondent states that he had to seek the assistance of the police to implement the order because his court had no regular sheriff and because there were armed guards employed by both parties. [3]

In compliance with our Resolution dated August 14, 2002,[4] both parties manifested their willingness to submit the case on the basis of the pleadings filed.[5]

After evaluation, the Office of the Court Administrator (OCA) found respondent guilty of delay in the rendition of judgment in Civil Case No. 1110 and erred in issuing a temporary restraining order despite procedural defects. Hence, it

recommended that respondent be fined in the amount of Ten Thousand Pesos (P10,000.00).

We agree with the findings of the OCA, however, we find the recommended penalty to be not commensurate with the gravity of respondents misdeeds.

The reasons proffered by respondent judge, i.e., that he had to hear cases in the other courts, will not excuse his delay in deciding Civil Case No. 1110.[6] If he felt that he could not decide the case within the reglementary period, he should have asked for a reasonable extension of time to decide the same.[7]

The office of a judge exists for one solemn end to promote the ends of justice by administering it speedily and impartially. The judge as the person presiding over that court is the visible representation of the law and justice.[8] Failure to resolve cases submitted for decision within the period fixed by law constitutes a serious violation of the constitutional right of the parties to a speedy disposition of their cases.[9]

Rules 1.02 of Canon 1 and 3.05 of Canon 3 of the Code of Judicial Conduct state:

Rule 1.02. A judge should administer justice impartially and without delay. (Emphasis ours)

Rule 3.05. A judge shall dispose of the courts business promptly and decide cases within the required periods. (Emphasis ours)

Moreover, SC Administrative Circular No. 13-87 provides:

3. Judges shall observe scrupulously the periods prescribed by Article VIII, Section 15 of the Constitution for the adjudication and resolution of all cases or matters submitted in their courts. Thus, all cases or matters must be decided or resolved within twelve months from date of submission by all lower collegiate courts while all other lower courts are given a period of three months to do so. . . (Emphasis ours)

Along the same vein, SC Administrative Circular No. 1-88 states:

6.1 All Presiding Judges must endeavor to act promptly on all motions and interlocutory matters pending before their courts. x x x.

Considering the summary nature of Civil Case No. 1110, which is an action for forcible entry, Rule 70, Section 11 of the 1997 Rules of Summary Procedure expressly provides:

Period for rendition of judgment. Within thirty (30) days after receipt of the affidavits and position papers, or the expiration of the period for filing the same, the court shall render judgment.

However, should the court find it necessary to clarify certain material facts, it may, during the said period, issue an order specifying the matters to be clarified, and require the parties to submit affidavits or other evidence on the said matters within ten (10) days from receipt of said order. Judgment shall be rendered within fifteen (15) days after receipt of the last affidavit or the expiration of the period for filing the same.

Provisional Remedies Sections 6-9 13

The court shall not resort to the foregoing procedure just to gain time for the rendition of judgment. (Emphasis ours)

Thus, respondent judge is guilty of gross inefficiency for his failure to resolve and dispose of Civil Case No. 1110 within the period prescribed by the Rules. The penalty for gross inefficiency ranges from reprimand and admonition[10] to removal from office[11] and/or a fine.[12]

Respondent judge likewise erred in issuing the temporary restraining order. Rule 58, Section 4 of the 1997 Rules of Civil Procedure provides:

Verified application and bond for preliminary injunction or temporary restraining order. A preliminary injunction or temporary restraining order may be granted only when:

(a) The application in the action or proceeding is verified and shows facts entitling the applicant to the relief demanded; and

(b) Unless exempted by the court, the applicant files with the court where the action or proceeding is pending, a bond executed to the party or person enjoined, in an amount to be fixed by the court, to the effect that the applicant will pay to such party or person all damages which he may sustain by reason of the injunction or temporary restraining order if the court should finally decide that the applicant was not entitled thereto. Upon approval of the requisite bond, a writ of preliminary injunction shall be issued.

(c) When an application for a writ of preliminary injunction or a temporary restraining order is included in a complaint or any initiatory pleading, the case, if filed in a multiple-sala court shall be raffled to only after notice to and in the presence of the adverse party or the person to be enjoined. In any event, such notice shall be preceded, or contemporaneously accompanied by service of summons, together with a copy of the complaint or initiatory pleading and the applicants affidavit and bond, upon the adverse party in the Philippines.

However, where the summons could not be served personally or by substituted service despite diligent efforts, or the adverse party is a resident of the Philippines, temporarily absent therefrom or is a nonresident thereof, the requirement of prior contemporaneous service of summons shall not apply.

(d) The application for a temporary restraining order shall thereafter be acted upon only after all the parties are heard in a summary hearing which shall be conducted within twenty-four (24) hours after the sheriffs return of service and/or the records are received by the branch selected by raffle to which the records shall be transmitted immediately.

The records reveal that the motion for temporary restraining order was not verified.[13] Respondent judge issued the Order on the same date when the motion was filed without prior notice to the complainant and without a hearing.

The issuance of the assailed Order cannot be justified under Rule 58, Section 5 of the 1997 Rules of Civil Procedure, which reads:

Preliminary injunction not granted without notice; exception. No preliminary injunction shall be granted without hearing and prior notice to the person or party sought to be enjoined. If it shall appear from the facts shown by the affidavits of by the verified application that great or irreparable injury would result to the applicant before the matter can be heard on notice, the court to which the application for preliminary injunction was made, may issue a temporary restraining order to be effective only for a period of twenty (20) days from service on the party or person sought to be enjoined, except as herein provided. Within the said twenty-day period, the court must order said party of person to show cause, at a specified time and place, why the injunction should not be granted, determine within the same period whether or not the preliminary injunction shall be granted and accordingly issued the corresponding order.

However, and subject to the provisions of the preceding sections, if the matter is of extreme urgency and the applicant will suffer grave injustice and irreparable injury, the executive judge of a multiple-sala court or the presiding judge of a single-sala court may issue ex parte a temporary restraining order effective for only seventy-two (72) hours from issuance but he shall immediately comply with provisions of the next preceding section as to service of summons and the documents to be served therewith. Thereafter, within the aforesaid seventy-two (72) hours, the judge before whom the case is pending shall conduct a summary hearing to determine whether the temporary restraining order shall be extended until the application for preliminary injunction can be heard. In no case shall the total period of effectivity of the temporary restraining order exceed twenty (20) days, including the original seventy-two (72) hours provided therein. (Emphasis and italics ours)

Aside from the lack of verification of the motion, no affidavits of the applicant and his witnesses were appended thereto. Furthermore, the assailed Order did not specify the duration of the temporary restraining order.

Respondent argues that considering that the complaint in Civil Case No. 1110 was verified and prayed for the issuance of a preliminary and prohibitory injunction, the verification of the motion for issuance of temporary restraining order may be dispensed with. We do not agree.

The Rules as above-quoted explicitly mandate that the application for injunction should be verified. While litigation is not a game of technicalities, every case must be prosecuted in accordance with the prescribed procedure to insure an orderly administration of justice.[14]

We see nothing wrong in respondents act of securing the assistance of the police in implementing his Order. Administrative Circular No. 12-85, paragraph 7 allows a judge to designate or deputize any person to serve court processes and writs in remote areas in the absence of the regular sheriff thereat.

Furthermore, the better part of prudence, caution and plain conventional wisdom dictates the presence of the police on account of the potentially violent situation engendered by the presence of armed followers of the contending factions.

Considering the seriousness of the respondent judges offenses, stiffer penalties should be imposed to inculcate in him the value of being proficient in both substantive and procedural laws.

Provisional Remedies Sections 6-9 14

In Caas v. Castigador,[15] we held:

Observance of the law which he is bound to know and sworn to uphold is required of every judge. When the law is sufficiently basic, a judge owes it to his office to simply apply it; anything less than that would be constitutive of gross ignorance of the law. In short, when the law is so elementary, not to be aware of it constitutes gross ignorance of the law.

In the case at bar, the ignorance of respondent judge is so gross that he should be held administratively liable even if he acted in good faith.[16] Hence, the imposition of a fine in the amount of P20,000.00 is a more appropriate penalty.

WHEREFORE, based on the foregoing, respondent Judge Francisco H. Lopez, Jr. of the Municipal Circuit Trial Court of Lupon, Davao Oriental, is found GUILTY of gross ignorance of the law and gross inefficiency. He is ordered to pay a FINE in the amount of Twenty Thousand Pesos (P20,000.00) and is STERNLY WARNED that a repetition of the same or similar acts shall be dealt with more severely.

SO ORDERED.

Provisional Remedies Sections 6-9 15