Case Digest (G.R. No. 183905)
Facts:
Petitioner Government Service Insurance System (GSIS) filed a verified complaint with the Securities and Exchange Commission (SEC) on 26 May 2008 seeking to annul and enjoin the recognition of proxies in favor of certain management nominees for the 27 May 2008 Meralco annual meeting, and the SEC issued a Cease and Desist Order (CDO) and a Show Cause Order (SCO) the same day. The Court of Appeals on 23 July 2008 dismissed GSIS's SEC complaint for lack of jurisdiction and declared the CDO and SCO void ab initio; subsequent petitions reached the Supreme Court as G.R. Nos. 183905 (GSIS) and 184275 (filed by the SEC and officers), the latter of which the Court expunged for lack of capacity.
Issues:
- Whether the SEC and its officers had legal capacity to file the petition in G.R. No. 184275.
- Whether the SEC had jurisdiction to entertain GSIS's complaint challenging proxies in connection with the election of Meralco directors.
- Whether the CDO and SCO issued by the SEC were valid.
Ruling:
The Court expunged the petition in G.R. No. 184275 for lack of capacity of the SEC and its officers to bring the suit. The Court dismissed the petition in G.R. No. 183905 for lack of merit, affirmed the Court of Appeals' dismissal of GSIS's SEC complaint for lack of jurisdiction and the nullification of the CDO and SCO, and deleted specified portions of the appellate court's fallo; it also held the sanctions against GSIS lawyers unwarranted.
Ratio:
Under Rule 65, the SEC and its officers were only public respondents and lacked the status of real parties-in-interest entitled to invoke this Court's certiorari remedy, hence G.R. No. 184275 was expunged. Election controversies touching on the election or appointment of directors, including proxy validation, fell within the original and exclusive jurisdiction of the regular courts by virtue of Section 5.2 of the Securities Regulation Code (SRC) in relation to Section 5(c) of Presidential Decree No. 902-A and the Interim Rules on Intra‑Corporate Controversies, so the SEC lacked authority to adjudicate GSIS's petition concerning proxies used for director elections. The CDO was invalid for failure to specify the precise statutory basis, for conflating distinct CDO provisions, and for being issued unilaterally by a single commissioner without the collegial quorum required of the SEC, thereby denying due process; likewise the SCO lacked effect given the SEC's want of jurisdiction.
Doctrine:
- A public respondent named under Rule 65 is not a real party-in-interest and lacks capacity to file a petition for certiorari in this Court.
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