Title
N. M. Baluyot and Co. vs. Ty
Case
G.R. No. L-29905
Decision Date
Dec 24, 1968
Ty sued UTC over a sole buyership contract; courts issued conflicting injunctions, delaying resolution. Petitioner alleged judicial abuse, but Supreme Court deferred to Court of Appeals.

Case Digest (G.R. No. L-29905)
Expanded Legal Reasoning Model

Facts:

  • Contract and Renewal Negotiations
    • On April 28, 1967, respondent Antonio Ty and Union Textile Corporation (UTC) entered into a written agreement.
      • UTC undertook to manufacture, sell, and deliver textile products for one year.
      • Ty agreed to buy all the textile products manufactured by UTC during the term.
    • As the contract neared its expiration, negotiations to renew the agreement commenced.
      • On April 18, 1968, the Chairman of the UTC Executive Committee reminded Ty in writing of the impending expiration and invited him to submit new terms and conditions for the contract’s renewal.
      • On April 24, 1968, Ty submitted his proposed terms and conditions for a new contract.
  • Petitioner’s Intervention and Alternate Offer
    • In parallel with Ty’s submission, petitioner N. M. Baluyot & Co. sent two letters (dated April 22 and May 8, 1968) offering a sole buyership agreement with UTC.
      • The terms set forth in petitioner’s offer were accepted by the Board of Directors of UTC on May 14, 1968.
    • The execution of the sole buyership contract, scheduled for June 6, 1968, was disrupted by subsequent legal actions.
  • Filing of the Preliminary Injunction by Ty
    • Two days prior to the scheduled execution of the sole buyership contract, Ty filed a petition in Civil Case No. 73189 before the Court of First Instance of Manila, Branch II.
      • Judge Jose Leuterio issued an order restraining UTC from:
        • Entering into any sole buyership agreement with any party other than Ty.
        • Selling and delivering its textile goods and yarns to parties other than Ty, mandating exclusive transactions with him.
    • Petitioner intervened in this case (with prior leave of court) and filed an opposition to the issuance of the writ of preliminary injunction sought by Ty.
    • At the hearing on June 19, 1968:
      • Ty failed to present any evidence supporting his petition.
      • Petitioner presented documentary evidence to show that Ty’s cause of action was disputed and not free from doubt.
    • Despite the evidence, Judge Leuterio issued the preliminary injunction after the filing and approval of a P30,000 bond, effectively preventing the implementation of the sole buyership contract awarded to petitioner.
  • Subsequent Legal Maneuvers
    • On June 29, 1968, petitioner filed a petition for certiorari with the Court of Appeals, seeking the issuance of a writ of preliminary injunction against Judge Leuterio and Ty (CA-G.R. No. 41449-R).
      • On July 3, 1968, the Court of Appeals issued an order restraining the respondents from enforcing Judge Leuterio’s order, later confirmed on July 12, 1968.
    • Meanwhile, on July 6, 1968, Ty commenced a new action against UTC in Civil Case No. 73530, assigned to Branch XV of the Court of First Instance of Manila, presided over by Judge Felix Domingo.
      • The complaint sought specific performance and damages exceeding nearly P5,000,000, alleging that UTC had made short deliveries by selling fabrics and yarns to third parties in contravention of the agreement with Ty.
    • In Civil Case No. 73530:
      • On July 9, 1968, Judge Domingo issued a restraining order prohibiting UTC from selling or delivering its textile goods and yarns to any third party until it complied with its contractual obligations towards Ty.
      • Petitioner was allowed to intervene and promptly filed an opposition to the issuance of a writ of preliminary injunction.
    • The scheduling of hearings for the injunction petition in Civil Case No. 73530 experienced multiple postponements:
      • Originally set for July 13, 1968, the hearing was cancelled and reset on August 6, 1968 upon Ty’s motion.
      • Despite petitioner’s objections, subsequent motions by Ty led to further postponements to August 22, then to August 26, and eventually, upon an ex parte motion by UTC, to October 7, 1968.
      • Just prior to the October 7 hearing, Ty moved once more to postpone the proceedings so that the evidence to be presented might later be incorporated during the trial on the merits. Judge Domingo granted this postponement, setting the hearing for the writ of preliminary injunction simultaneously with the trial.
    • The petitioner contended that these repeated postponements and the simultaneous scheduling of the injunction hearing with the trial would have the effect of maintaining the injurious restraining order indefinitely, thereby nullifying the definitive relief provided by the Court of Appeals.
  • Jurisdictional and Procedural Context
    • The petitioner’s claim was framed under a verified petition for certiorari, prohibition, and/or mandamus.
    • The case was brought before the Supreme Court, although under the recent amendments to Section 29 of the Judiciary Act of 1948, such writs are generally to be filed with the Court of Appeals, given its original jurisdiction over appeals in the pending main case (Civil Case No. 73530).
    • Reference was made to the Breslin et al. vs. Luzon Stevedoring Company case, which stated that while the Court of Appeals has original jurisdiction in issuing such writs in aid of its appellate function, this jurisdiction is not exclusive.

Issues:

  • Abuse of Discretion and Delay
    • Did the respondent judge (Judge Leuterio and subsequently Judge Domingo) abuse his discretion by:
      • Issuing a preliminary injunction without adequate evidentiary support or bond in the earlier proceeding?
      • Repeatedly postponing the hearing on the petition for a writ of preliminary injunction, thereby delaying a definitive resolution and extending the injurious effects of the restraining order indefinitely?
    • Was such delay intentionally used to circumvent or nullify the effect of the restraining order issued by the Court of Appeals?
  • Proper Forum and Jurisdiction
    • Considering the amendments to Section 29 of the Judiciary Act of 1948, should the petition for certiorari, prohibition, and/or mandamus have been filed with the Court of Appeals rather than the Supreme Court?
    • Does the existing jurisprudence allow for the Supreme Court to entertain special civil actions when the Court of Appeals possesses the original jurisdiction for issuing these writs in aid of its appellate function?
  • Prejudice to the Petitioner
    • Has the continuation of the restraining order, along with its indefinite effect due to scheduling tactics, prejudiced petitioner’s right to a timely and fair resolution regarding the sole buyership contract awarded to it?

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Doctrine:

  • (Subscriber-Only)
Unlock Full Case Digest

Analyze Cases Smarter, Faster
Jur is a legal research platform serving the Philippines with case digests and jurisprudence resources. AI digests are study aids only—use responsibly.

About Privacy Terms