Case Digest (G.R. No. 208844)
Facts:
F & S Velasco Company, Inc., Irwin J. Seva, Rosina B. Velasco-Scribner, Mercedez Sunico, and Jose Saturnino O. Velasco v. Dr. Rommel L. Madrid, Peter Paul L. Danao, Manuel L. Arimado, and Maureen R. Labalan, G.R. No. 208844, November 10, 2015, Supreme Court First Division, Perlas‑Bernabe, J., writing for the Court. This case arose from a petition for review on certiorari contesting the Court of Appeals’ Decision (March 1, 2013) and Resolution (August 7, 2013) in CA‑G.R. SP No. 113279 which had modified the Regional Trial Court of Legazpi City, Branch 5 (RTC, SR‑09‑007)’s March 3, 2010 decision.On June 8, 1987, F & S Velasco Company, Inc. (FSVCI) was incorporated with Francisco O. Velasco, Simona J. Velasco, Angela V. Madrid (Angela), respondent Dr. Rommel L. Madrid (Madrid), and petitioner Jose Saturnino O. Velasco (Saturnino) among the incorporators. By May 11, 2009, Angela held 16,998 of FSVCI’s 24,000 shares (70.82%); Madrid held 1,000 shares; Scribner held 6,000; and Seva and Sunico held one share each. Angela died on September 20, 2009; on October 8, 2009 Madrid executed an Affidavit of Self‑Adjudication claiming Angela’s estate (including her FSVCI shares) and thereafter called a Special Stockholders’ and Re‑Organizational Meeting for November 18, 2009, after allegedly transferring one share each to several associates (the “Madrid Group”).
Separately, on November 6, 2009 FSVCI Secretary Irwin J. Seva convened an Emergency Meeting attended by Saturnino, Seva, and Sunico (the “Saturnino Group”), which recognized Saturnino as a board member and elected him president and elected Scribner vice‑president. The Saturnino Group sought injunctive relief in the RTC to annul the November 18 meeting. The RTC denied a TRO, and in the plenary case the Madrid Group counterclaimed and sought appointment of a Management Committee; the RTC denied that relief by order dated January 12, 2010.
In a Decision dated March 3, 2010, the RTC declared both the November 6, 2009 and November 18, 2009 meetings null and void: the November 6 meeting for lack of quorum and improper board composition; and the November 18 meeting because Madrid’s claimed rights over Angela’s shares were equitable pending settlement of her estate, so he could not exercise shareholder powers. The Madrid Group appealed to the Court of Appeals; the Saturnino Group did not appeal the RTC’s invalidation of the November 6 meeting.
The Court of Appeals, however, in its March 1, 2013 Decision reversed the RTC as to the November 18 meeting and held that Madrid’s Affidavit of Self‑Adjudication, together with the General Information Sheet (GIS) filed with the Securities and Exchange Commission (SEC), established his effective ownership (74.98%) and thus validated the November 18, 2009 meeting; the CA also remanded the case and ordered the trial court to constitute a Management Committee for FSVCI. The CA denied reconsideration in its August 7, 2013 Resolution. The Saturnino Group then filed this appeal via petition for review on certiorari under Rule 45.
After the CA decision, Madrid filed probate proceedings in the RTC‑Makati (S.P. No. M‑7025). By orders dated December 29, 2010 and March 29, 2011 the RTC‑Makati recognized Madrid as Angela’s sole heir and appointed him Special Administr...(Pro-only)
Issues:
- Was the November 18, 2009 Special Stockholders’ and Re‑Organizational Meeting called by Dr. Rommel L. Madrid valid and binding on F & S Velasco Company, Inc.?
- Was the Court of Appeals correct in directing the appointment/constitution of a Management Committee to take over FSVCI’s corpor...(Pro-only)
Ruling:
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Ratio:
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Doctrine:
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