G.R. No. 126556 - David vs. Court of Appeals

The dispute arose from a judgment awarding Petron Corporation an amount of P1,291,456,320.00 for the use of water over a three-year period (1992–1994).
The controversy centered on Municipal Ordinance No. 90 passed by the Sangguniang Bayan of Limay, Bataan, which imposed a charge of approximately P430 million per year on Petron Corporation for the municipality’s water.
Petron contested the applicability of the ordinance before the Regional Trial Court, alleging that its water consumption did not exceed P7 million worth per year.

The Regional Trial Court rendered a judgment upholding the validity of Municipal Ordinance No. 90.
Petron elevated the issue to the Court of Appeals, which handled the appeal under docket CA-G.R. No. CV-52293.
Before the appeal was perfected, Petron filed a motion for partial execution pending appeal.
Acting under Section 2, Rule 39 of the former Rules of Court, the Regional Trial Court ordered partial execution to the amount of P50 million pending appeal.

The Court of Appeals, via its April 24, 1996 decision and October 7, 1996 resolution, declared void the special order of partial execution due to alleged grave abuse of discretion.
The certiorari petition questioning the partial execution order was filed, prompting the issue of whether the regional trial court had validly exercised its discretionary powers.
The Court highlighted that while execution pending appeal is allowed under exceptional circumstances, such execution must be firmly founded on compelling and urgent reasons.

The applicable legal standard was Section 2, Rule 39 of the former Rules of Court, which permits execution pending appeal only upon good and special reasons.
This standard was illustrated with precedents such as De Leon vs. Soriano (pertaining to cases of advanced age or health issues), Padilla vs. Court of Appeals (involving debtor insolvency), and Lao vs. Mencias (where defendants had no appreciable assets besides the subject property).
The Court of Appeals further clarified that the mere posting of a bond does not satisfy the requirement of demonstrating special, immediate, and pressing reasons for execution pending appeal.

Whether the Regional Trial Court correctly exercised its discretion in ordering partial execution pending appeal based on Section 2, Rule 39.

Consideration of whether the circumstances presented by Petron justified immediate execution despite the pending appeal.
Examination of whether the special reasons cited sufficiently demonstrated urgency or necessity.

Whether the posting of a bond, as employed by Petron, could be deemed an adequate ground for execution pending appeal.
Determination of the proper role of the appellate court in not expanding its ruling on the special order beyond the exercise of discretion by the trial court.

Addressing whether the partial execution order may affect the pending main appeal.
Evaluating if the decision on the validity of Municipal Ordinance No. 90, mentioned obiter by the Court of Appeals, should influence the execution pending appeal.