Facts:

This case revolves around a Petition for Review on Certiorari filed by Australian Professional Realty, Inc. (APRI), along with individuals Jesus Garcia and Lydia Marciano, against the Municipality of Padre Garcia, Batangas. The events leading to the case began in 1993 when a fire destroyed the old public market in Padre Garcia. The then Municipal Mayor Eugenio Gutierrez invited APRI to rebuild the market and construct a shopping center. Subsequently, on January 19, 1995, a Memorandum of Agreement (MOA) was executed, wherein APRI committed to construct a shopping complex on a 5,000-square-meter lot in exchange for the exclusive right to operate and manage stall spaces for 25 years.

In May 1995, Victor Reyes became the new municipal mayor. On February 6, 2003, Reyes initiated a complaint for the Declaration of Nullity of the MOA with Damages against APRI before the Regional Trial Court (RTC) of Rosario, Batangas, which was filed as Civil Case No. 03-004. Attempts to serve summons

...

Facts:

Background and Agreement

• In 1993, a fire razed the old public market of the Municipality of Padre Garcia, Batangas.
• The municipal government, through then-Mayor Eugenio Gutierrez, invited Australian Professional Realty, Inc. (APRI) to rebuild the public market and construct a shopping center.
• On January 19, 1995, a Memorandum of Agreement (MOA) was executed between APRI and the Municipality, represented by Mayor Gutierrez and the members of the Sangguniang Bayan.
• Under the MOA, APRI undertook to construct a shopping complex on a 5,000-square-meter area.
• In exchange, APRI obtained the exclusive right to operate, manage, and lease stall spaces for a period of 25 years.
• In May 1995, Victor Reyes was elected as the new municipal mayor.

Initiation of Litigation and RTC Proceedings

• On February 6, 2003, the Municipality, through Mayor Reyes, filed a Complaint for Declaration of Nullity of the MOA with damages before the Regional Trial Court (RTC) of Rosario, Batangas (Civil Case No. 03-004).
• Summons was issued on February 12, 2003, but was returned unserved due to petitioners’ change of address.
• On April 2, 2003, respondent petitioned for and was granted leave of service by publication.
• On November 24, 2003, the RTC issued an order declaring petitioners in default and allowed respondent to present evidence ex parte.
• The RTC rendered its decision on October 6, 2004, after considering testimonial and documentary evidence presented by both sides.
• The MOA was declared null and void on the ground that it was contrary to law and public policy, notably referencing R.A. 6957 and R.A. 7718.
• The Municipality was ordered to receive damages amounting to ₱5,000,000 from petitioners.
• Structures found within the unfinished Padre Garcia Shopping Center were declared forfeited in favor of the Municipality.
• With no timely appeal from petitioners, the Municipality moved for the execution of the judgment, which was granted by the RTC, and a Writ of Execution was issued on July 15, 2005.

Subsequent Petitions and Motions

• In response to the adverse RTC decision and its execution, petitioners filed a Petition for Relief from Judgment on July 18, 2005, which was denied by the RTC on June 15, 2006.
• A Motion for Reconsideration was also denied on February 14, 2008.
• Petitioners filed a Petition for Certiorari and Prohibition before the Court of Appeals (CA) on February 28, 2008 (docketed as CA-G.R. SP No. 102540).
• On March 7, 2008, petitioners moved for the issuance of a Status Quo Order and a Temporary Restraining Order (TRO) and/or Writ of Preliminary Injunction to halt further judicial actions such as the issuance of any additional orders or processes by the RTC.
• The CA, on March 26, 2008, denied the motion on the ground that the matter did not present extreme urgency nor a clear and irreparable injury.
• The CA reaffirmed its decision on June 17, 2008 when petitioners filed a Motion for Reconsideration.
• Petitioners then filed the instant Petition for Review on Certiorari with the Supreme Court on July 6, 2008.
• In their petition, petitioners claimed substantial investments (estimated at ₱30,000,000) in the Padre Garcia Shopping Center and complained about the alleged arbitrary forfeiture of these investments without just compensation.
• They further argued that the RTC rendered its decision without obtaining jurisdiction over them due to improper service of summons, asserting that executing a void judgment would work injustice on their behalf.

Procedural and Substantive Allegations Raised by Petitioners

• Procedural Allegation: Petitioners contended that the RTC had no jurisdiction over them given the failure of proper service, citing deficiencies in the process server's return and attempts to locate them.
• Substantive Allegation: Petitioners argued that the enforcement of the final RTC decision, which nullified the MOA and ordered forfeiture, was unjust. They claimed that the denial of injunctive relief by the CA violated their right to due process, given the significant financial and operational consequences (loss of tenants, rental income, job losses, etc.) that would result from the execution of the judgment.

Issue:

Procedural Issue

• Whether the petitioners’ filing of a Petition for Review on Certiorari under Rule 45 was the proper remedy to question the denial of their application for injunctive relief, given that an order granting or denying preliminary injunction is interlocutory and generally not appealable.

Substantive Issue

• Whether there was grave abuse of discretion by the Court of Appeals in denying petitioners’ Motion for the Issuance of a Status Quo Order and Motion for a Temporary Restraining Order and/or Writ of Preliminary Injunction.
• Whether petitioners established the essential requisites for injunctive relief, namely:
• A clear and unmistakable legal right to protect under the MOA.
• An imminent threat of serious and irreparable injury that cannot be remedied by damages alone.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)