Title
Albert vs. Court of 1st Instance
Case
G.R. No. L-26364
Decision Date
May 29, 1968
A non-existent corporation's president, Jose M. Aruego, was held personally liable for a breach of contract judgment, despite not being formally named as a defendant, as he acted on behalf of the non-existent entity and effectively litigated the case. The Supreme Court ruled that the lower court committed grave abuse of discretion by refusing to execute the judgment against him, emphasizing due process and conclusiveness of judgment.
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Case Digest (G.R. No. L-26364)

Facts:

  1. Origins of the Case:

    • The case began in 1949 when Mariano A. Albert sued University Publishing Co., Inc. for breach of contract. Albert died before trial, and his estate's administrator, Justo R. Albert, was substituted as plaintiff.
    • The Supreme Court, in a prior decision (L-15275), ruled that University Publishing Co., Inc. was liable to pay P15,000.00 with legal interest from judicial demand.
  2. Discovery of Non-Existent Corporation:

    • When the Court of First Instance of Manila issued an order of execution on July 22, 1961, it was discovered that University Publishing Co., Inc. did not exist as a registered corporation. A certification from the Securities and Exchange Commission (SEC) confirmed this.
    • Jose M. Aruego, who signed the contract as President of University Publishing Co., Inc., was revealed to be the real party behind the non-existent entity.
  3. Attempts to Execute Judgment Against Aruego:

    • Plaintiff sought to execute the judgment against Aruego personally, arguing that he was the real defendant. However, the lower court denied this, stating that Aruego was not a formal party to the case.
    • The Supreme Court, in L-19118, ruled that Aruego was personally liable as he acted on behalf of a non-existent corporation and had effectively litigated the case through his law firm.
  4. Subsequent Proceedings:

    • Despite the Supreme Court's ruling, Aruego continued to resist execution, claiming he was not a party to the case. He submitted documents to prove the corporation's existence, but these were rejected by the Supreme Court as untimely and irrelevant.
    • The lower court, presided by Judge Gaudencio Cloribel, repeatedly denied execution against Aruego, leading to the present petition for certiorari and mandamus.

Issue:

  1. Whether the judgment against University Publishing Co., Inc. can be enforced against Jose M. Aruego personally, despite not being formally named as a party in the case.
  2. Whether the lower court committed grave abuse of discretion in refusing to execute the judgment against Aruego, contrary to the Supreme Court's prior ruling.
  3. Whether Aruego's belated submission of documents proving the corporation's existence should be considered, given the Supreme Court's earlier rejection of such evidence.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Conclusion:

The Supreme Court granted the petition for certiorari and mandamus, setting aside the lower court's orders and directing the issuance of a writ of execution against University Publishing Co., Inc. and/or Jose M. Aruego. The Court imposed treble costs on Aruego for his repeated attempts to evade liability.


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