G.R. No. 139767 - Dungog vs. Court of Appeals

Felipe Sy Dungog, the petitioner, is the owner of Lot 1031-F, registered under Transfer Certificate of Title No. 10359, which was part of a larger group of properties sold by his parents (the Spouses Dungog).
Felipe, along with his sister Fortune, had an arrangement through their parents to sell their lots in Canjulao, Cebu. The Spouses Dungog further persuaded other lot owners in the area to join in selling their properties.

On December 31, 1996, the Spouses Dungog entered into a Contract to Sell with private respondent Carlos A. Gothong Lines, Inc., covering several lots detailed in Annex "A" of the Contract, with each lot’s corresponding area specified.
The contract price was computed at P500 per square meter, totaling P65,520,475.00, with an initial down payment of P12,000,000.00 followed by 15 equal monthly installments evidenced by 15 postdated checks.
Despite most installments being honored, the last four checks (dated from December 30, 1997, to March 30, 1998) bounced because Gothong Lines had issued a stop payment order.

The Spouses Dungog delivered 66 parcels of land (with a total area of 101,104.20 square meters) by December 31, 1997, for which Gothong Lines had paid a substantial sum in encashed checks, leaving a residual overpayment of P696,245.00 with the vendors.
In February 1998, despite the stop payment on the checks, the Spouses Dungog delivered an additional 8 parcels, including Lot 1031-F, with a combined area of 11,590 square meters and value of P5,795,000.00.
A payment dispute arose when the Spouses Dungog demanded payment for these eight parcels, which Gothong Lines refused, eventually leading the vendors to state in a letter on June 18, 1998, that they would no longer proceed with delivering the remaining lots.

On July 6, 1998, Gothong Lines filed a complaint for specific performance and damages, seeking a writ of preliminary injunction to enforce the Contract and to restrain the Spouses Dungog from canceling it or barring access through Lot 1031-F.
To safeguard its interests—including access for vehicles, equipment, and personnel to continue its development work on the majority (approximately 78%) of the properties already delivered—Gothong Lines requested that the trial court maintain access by issuing a writ of preliminary injunction.
The Regional Trial Court of Cebu, Lapu-Lapu City, Branch 53, granted the application on August 14, 1998, by enjoining the cancellation of the contract and the closure of the passage in Lot 1031-F. The writ was subsequently issued and served on August 18, 1998.

Felipe, although the owner of Lot 1031-F and the son of one of the vendors, filed a special civil action for certiorari assailing the trial court’s Order and the writ of preliminary injunction, alleging a deprivation of his property without due process and just compensation.
The Court of Appeals, however, dismissed Felipe’s petition outright, emphasizing that he lacked the requisite standing as he was not a party to the original civil case (Civil Case No. 5020-L) between the Spouses Dungog and Gothong Lines.
A subsequent motion for reconsideration was also denied by the appellate court on August 24, 1999.

Whether Felipe, despite being the owner of Lot 1031-F, could properly challenge the trial court’s Order and the issued writ through a petition for certiorari when he was not a litigant in the original case.
Whether his familial relation to the Spouses Dungog sufficed for establishing his standing to raise such a challenge.

Whether the dismissal of Felipe’s petition effectively resulted in the deprivation of his property—specifically, the alleged confiscation or barring of access to Lot 1031-F—without due process or payment of just compensation.

Whether the trial court properly exercised its discretion in issuing the writ of preliminary injunction to maintain the status quo in light of the substantial performance of the contract by Gothong Lines.
Whether the injunction was necessary to prevent irreparable harm to Gothong Lines’ ongoing development efforts while the dispute over the contract’s performance was unresolved.