Case Digest (G.R. No. 167583-84)
Case Digest (G.R. No. 167583-84)
Facts:
Artistica Ceramica, Inc., Ceralinda, Inc., Cyber Ceramics, Inc. and Millennium, Inc. v. Ciudad Del Carmen Homeowner’s Association, Inc. and Bukluran Purok II Residents Association, G.R. Nos. 167583-84, June 16, 2010, the Supreme Court Second Division, Peralta, J., writing for the Court.Petitioners are four Pasig City corporations engaged in ceramic manufacture; respondents are two residents’ associations occupying nearby communities. In 1997 respondents sent complaints to several government agencies alleging noise, air and water pollution and safety hazards from petitioners’ plants, which prompted Closure and Cease-and-Desist Orders from regulatory bodies.
To settle the disputes, the parties executed a June 29, 1997 Drainage Memorandum of Agreement (Drainage MOA) and a November 14, 1997 Memorandum of Agreement (MOA). Under the MOA petitioners undertook, inter alia, to cease manufacturing on scheduled dates (by May 7, 2000 for all operations), to establish an Environmental Guarantee Fund, to furnish a P25,000,000 performance bond, and to submit to an Arbitration and Monitoring Committee; respondents in turn agreed to move for dismissal of complaints.
On July 17, 2000 respondents filed a complaint before the Arbitration Committee alleging noncompliance. On April 2, 2002 the Arbitration Committee issued a Decision finding partial noncompliance, ordering relocation within six months of finality (or P10,000/day fine), directing petitioners to remit P300,000 for a chapel project, and awarding damages: P1,000,000 temperate damages (joint and several), P100,000 to Bukluran Dos for inadequate drainage, and P100,000 for attorneys’ fees. Respondents’ motion that the performance bond be automatically forfeited was denied by the Arbitration Committee in a May 27, 2002 Resolution.
Both sides sought review in the Court of Appeals: petitioners filed CA-G.R. SP No. 70473 to contest the damages award; respondents filed CA-G.R. SP No. 71470 to seek forfeiture of the P25,000,000 performance bond. The CA consolidated the petitions and, on January 4, 2005, rendered a Decision affirming the arbitration award with modification (deleting the P300,000 contribution) and granting respondents’ petition by directing the automatic forfeiture of the P25,000,000 performance bond. Petitioners’ motion for reconsideration was denied by the CA on March 18, 2005.
Petitioners filed a special civil action for certiorari under Rule 65 of the Rules of Court in the Supreme Court on April 18, 2005, seeking to set aside the CA Decision and Resolution on grounds that the CA: (1) erred in declaring petitioners failed to provide drainage per the MOA; (2) incorrectly held petitioners solely culpable for lack of an Environmental Compliance Certificate; (3) awarded temperate damages without basis; and (4) ordered automatic forfeiture of the performance bond contrary to the MOA. The Supreme Court resolved the case on June 16, 2010.
Issues:
- Was a special civil action for certiorari under Rule 65 the proper remedy to challenge the Court of Appeals’ January 4, 2005 Decision and March 18, 2005 Resolution, or was an appeal under Rule 45, Sec. 2 available and adequate?
- (Subsidiary/substantive) Did the Court of Appeals commit grave abuse of discretion in declaring petitioners failed to comply with the MOA’s drainage obligations and in holding them solely culpable for lacking an ECC?
- Did the Court of Appeals err in awarding temperate damages?
- Did the Court of Appeals err in directing the automatic forfeiture of the P25,000,000 performance bond?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)