Case Digest (G.R. No. 167583-84)
Facts:
The case involves a petition for certiorari filed by petitioners Artistica Ceramica, Inc., Ceralinda, Inc., Cyber Ceramics, Inc., and Millennium, Inc. against respondents Ciudad Del Carmen Homeowner's Association, Inc. and Bukluran Purok II Residents Association. The events leading to the case began in 1997 when the respondents, residing near the petitioners' ceramic manufacturing plants in Pasig City, lodged complaints with various government agencies regarding noise, air, and water pollution attributed to the petitioners' operations. These complaints led to the issuance of Closure Orders and Cease-and-Desist Orders against the petitioners. To resolve the disputes amicably, the parties entered into two agreements: the Drainage Memorandum of Agreement (MOA) on June 29, 1997, and a subsequent MOA on November 14, 1997. The Drainage MOA required the petitioners to construct an effective drainage system, while the second MOA included commitments from the petitioners t...
Case Digest (G.R. No. 167583-84)
Facts:
Parties Involved:
- Petitioners: Artistica Ceramica, Inc., Ceralinda, Inc., Cyber Ceramics, Inc., and Millennium, Inc. (collectively referred to as "Mariwasa Subsidiaries").
- Respondents: Ciudad Del Carmen Homeowner's Association, Inc. and Bukluran Purok II Residents Association.
Background:
- Petitioners are corporations engaged in the manufacture of ceramics, with their plants located near the residential areas of respondents.
- In 1997, respondents filed complaints with various government agencies, alleging that petitioners' manufacturing activities caused noise, air, and water pollution, and posed safety and fire hazards.
- As a result, Closure Orders and Cease-and-Desist Orders were issued against petitioners.
Agreements Between Parties:
- To resolve the disputes, the parties entered into two agreements:
- Drainage Memorandum of Agreement (Drainage MOA) – June 29, 1997: Petitioners agreed to construct an effective drainage system in Bukluran Purok II.
- Memorandum of Agreement (MOA) – November 14, 1997: Respondents agreed to dismiss all complaints in exchange for petitioners' undertakings, including:
- Cessation of manufacturing activities by May 7, 2000.
- Establishment of an Environmental Guarantee Fund.
- Furnishing of a performance bond.
- Creation of an Arbitration and Monitoring Committee.
Breach of Agreements:
- On July 17, 2000, respondents filed a complaint with the Arbitration Committee, alleging that petitioners failed to comply with the MOA terms.
- The Arbitration Committee ruled in favor of respondents, directing petitioners to:
- Pay P300,000 for the construction of a chapel/multi-purpose hall.
- Address the ineffective drainage system.
- Relocate manufacturing facilities within six months or face a daily fine of P10,000.
- Pay P1,000,000 in temperate damages, P100,000 for drainage issues, and P100,000 in attorney’s fees.
Appeal to the Court of Appeals (CA):
- Both parties filed petitions for review with the CA.
- The CA modified the Arbitration Committee’s decision:
- Deleted the P300,000 payment for the chapel.
- Ordered the automatic forfeiture of the P25,000,000 performance bond in favor of respondents.
Petition to the Supreme Court:
- Petitioners filed a petition for certiorari under Rule 65, arguing that the CA committed grave abuse of discretion in:
- Declaring that petitioners failed to provide adequate drainage.
- Holding petitioners solely responsible for the lack of an Environmental Compliance Certificate (ECC).
- Awarding temperate damages without basis.
- Ordering the automatic forfeiture of the performance bond.
Issue:
- (Unlock)
Ruling:
- (Unlock)
Ratio:
- Proper Remedy: A petition for certiorari under Rule 65 is not a substitute for a lost appeal under Rule 45. Since petitioners had an available appeal but failed to file it within the reglementary period, their petition for certiorari was improper.
- Errors of Judgment vs. Grave Abuse of Discretion: The CA’s decision involved errors of judgment, which are correctible by appeal, not by certiorari. Grave abuse of discretion requires a showing of capricious or whimsical exercise of judgment, which was not present in this case.
- Forfeiture of Performance Bond: The forfeiture was justified because petitioners failed to fully comply with their obligations under the MOA, including the cessation of operations and establishment of the Environmental Guarantee Fund.
- Temperate Damages: The award of temperate damages was based on the evidence presented, showing that petitioners’ non-compliance caused harm to respondents.
- Liberal Application of Rules: The Court declined to apply a liberal interpretation of procedural rules, as petitioners failed to provide a valid explanation for their failure to file a timely appeal.
Conclusion:
The Supreme Court affirmed the CA’s decision, holding that petitioners’ failure to comply with the MOA justified the forfeiture of the performance bond and the award of damages. The petition was dismissed for being an improper remedy.