G.R. No. 192797 - Excellent Essentials International Corp. vs. Extra Excel International Philippines, Inc.

Excel International and Excel Philippines entered into an exclusive rights contract on August 9, 1996, granting Excel Philippines the exclusive right to distribute E. Excel products in the Philippines.
The contract provided that Excel International reserved the right to revoke or alter the agreement at any time.

During a four‐year period marked by intra-corporate struggles at Excel International, control shifted with Jau-Hwa Stewart emerging as the dominant figure.
On December 1, 2000, Stewart, acting as president of Excel International, unilaterally revoked Excel Philippines’ exclusive distributorship and appointed Excellent Essentials as the new exclusive distributor.

Despite the revocation and new appointment, Excel Philippines continued its operations in the Philippines.
On January 26, 2001, following Excel International’s demand to cease selling and marketing E. Excel products, Excel International and Excellent Essentials filed a complaint for injunction and damages against Excel Philippines before the RTC, Branch 56.
Excel Philippines, in its answer with counterclaims, argued that it had an irrevocable exclusive distributorship based on an earlier agreement (dated May 22, 1995) between Excel International and Bright Vision Consultants, Ltd.

The RTC, Branch 56, conducted a trial on the parties’ applications for a temporary restraining order and/or writ of preliminary injunction.
On April 4, 2001, the RTC ruled in favor of Excel Philippines, enjoining Excellent Essentials from interfering with its exclusive rights.
Excellent Essentials' motion for reconsideration was denied, and a petition for certiorari was subsequently filed before the Court of Appeals (CA).
Meanwhile, Excel International and Excel Philippines filed a joint motion to dismiss their claims based on a compromise agreement, which was approved by the RTC on June 14, 2001.

On February 11, 2002, the CA reversed the RTC’s preliminary injunction, citing grave abuse of discretion and expressing doubts about Excel Philippines’ exclusive distributorship claim given the revocation and conflicting exclusive rights contracts.
After further trial proceedings, the RTC, Branch 138, rendered a decision on September 8, 2006, dismissing both Excellent Essentials’ complaint and Excel Philippines’ counterclaims on several grounds, including noting the mootness of the controversy following a Utah Court decision.
Unsatisfied with the RTC decision, Excel Philippines appealed before the CA, and the CA modified the RTC decision by ordering Excellent Essentials to pay Excel Philippines damages, attorney's fees, and costs, initially awarding temperate as well as exemplary damages.

Excellent Essentials filed a petition for review before the Supreme Court, arguing that the CA’s earlier ruling on the preliminary injunction (CA-G.R. SP No. 65115) conclusively showed that its operations did not cause harm to Excel Philippines.
The petition also advanced that its corporate existence and subsequent operations were not the proximate cause of any alleged damages, and that any interference was merely an ancillary effect of Stewart’s unilateral actions.
The Supreme Court, while examining issues of tortious interference and the evidentiary basis for damages, ultimately denied the petition and upheld the CA decision—with a modification in the award—by replacing temperate damages with nominal damages.

Whether the earlier CA ruling in CA-G.R. SP No. 65115 regarding the issuance and nullification of the preliminary injunction is binding on the assessment of damages in the main case.
The extent to which immediate or interlocutory findings in early proceedings impact the final adjudication of damages.

Whether the actions and corporate existence of Excellent Essentials directly caused damage to Excel Philippines.
Whether Excellent Essentials, by anticipating and benefiting from the unilateral actions of Excel International (via Stewart), engaged in tortious interference by breaching the exclusive distributorship contract.

Whether the loss suffered by Excel Philippines due to decreased sales and disruption of its distribution network was proven with sufficient certainty to warrant temperate damages.
Whether the projected figures submitted to support the damages claim were reliable and adequately documented.