Case Digest (Adm. Case No. 12)
Facts:
The case at hand involves a petition for review filed by Mantruste Systems, Inc. (MSI) against the Court of Appeals concerning two consolidated cases: "Makati Agro-Trading, Inc., et al. vs. Judge Job Madayag, et al." (CA-G.R. SP No. 13929) and "Asset Privatization Trust vs. Judge Job Madayag, et al." (CA-G.R. SP No. 14535). The Court of Appeals' decision dated September 29, 1988 and the subsequent resolution on January 4, 1989, annulled a temporary restraining order issued by Judge Madayag in favor of MSI in Civil Case No. 18319. The heart of the matter arose from an interim lease agreement signed on August 26, 1986, between MSI and the Development Bank of the Philippines (DBP), wherein MSI was to manage the Bayview Plaza Hotel.On December 8, 1986, President Ferdinand Marcos issued Proclamation No. 50, initiating a program for the privatization of government assets, including the Bayview property which was subsequently transferred to Asset Privatization Trust (APT). MSI receiv
Case Digest (Adm. Case No. 12)
Facts:
- Lease Agreement and Privatization
- Mantruste Systems, Inc. (MSI) entered into an "interim lease agreement" with the Development Bank of the Philippines (DBP) on August 26, 1986, to operate the Bayview Plaza Hotel for a minimum of three months or until the property was sold to MSI or a third party.
- On December 8, 1986, President Corazon Aquino issued Proclamation No. 50, which launched a program for the privatization of certain government assets, including the Bayview Hotel. The property was transferred from DBP to the Asset Privatization Trust (APT) for disposition.
- Termination of Lease and Bidding Process
- DBP notified MSI of the termination of the lease agreement, and MSI agreed to the termination on September 18, 1987, with specific terms, including a 30-day notice period.
- APT granted MSI an extension until October 18, 1987, to vacate the premises. However, MSI later claimed a "priority right" to purchase the property, citing its long-term lease and alleged advances of P12 million.
- APT rejected MSI's claim, stating that no such priority right existed under the lease agreement. MSI attempted to participate in the bidding but was disqualified or voluntarily withdrew, depending on the conflicting accounts of the parties.
- The property was eventually awarded to Makati Agro-Trading, Inc. and La Filipina Uy Gongco Corp. for P85 million.
- Legal Proceedings
- MSI filed a complaint in the Regional Trial Court (RTC) of Manila, seeking a restraining order and injunction to prevent APT from awarding the property to the winning bidders and to retain possession of the hotel.
- The RTC granted a writ of preliminary injunction on December 15, 1987, which was later nullified by the Court of Appeals on September 29, 1988, for violating Section 31 of Proclamation No. 50-A, which prohibits courts from issuing injunctions against APT in connection with asset disposition.
Issues:
- Whether the Court of Appeals erred in nullifying the writ of preliminary injunction issued by the RTC.
- Whether Section 31 of Proclamation No. 50-A, which prohibits injunctions against APT, is unconstitutional.
- Whether MSI had a legally enforceable right to retain possession of the Bayview Hotel pending reimbursement of its alleged advances.
- Whether MSI had a priority right to purchase the property over other bidders.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)