Case Digest (G.R. No. 126556)
Facts:
This controversy arose from the foreclosure of three lots covered by Transfer Certificate of Title (TCT) Nos. 4314, 4315 and 4316, originally owned by Pampanga Bus Company, Inc. (PAMBUSCO) and mortgaged to the Development Bank of the Philippines (DBP) on January 3, 1962 for ₱935,000.00. The mortgage was foreclosed under Act No. 3135, and on October 25, 1974 these lots were sold at public auction and awarded to Rosita Pena, who paid ₱128,000.00 and received a sheriff’s certificate of sale, registered October 29, 1974.On November 19, 1974, three out of five PAMBUSCO directors—Jesus Domingo, Joaquin Briones and Salvador Bernardez—met and adopted a resolution purportedly assigning the company’s right of redemption to any interested party. Pursuant thereto, on March 18, 1975 Briones executed a Deed of Assignment in favor of Marcelino Enriquez. Enriquez redeemed the properties on August 15, 1975 by paying ₱140,474.00 and obtained a sheriff’s certificate of redemption. The next day h
Case Digest (G.R. No. 126556)
Facts:
- Mortgage, Foreclosure, and Initial Sale
- Pampanga Bus Co., Inc. (PAMBUSCO) owned lots under TCT Nos. 4314–4316 and on January 3, 1962 mortgaged them to the Development Bank of the Philippines for ₱935,000.00.
- The mortgage was foreclosed under Act No. 3135; on October 25, 1974 the lots were auctioned and awarded to Rosita Pena as highest bidder for ₱128,000.00. A certificate of sale was issued October 25 and registered October 29, 1974.
- Assignment of Redemption Right and Subsequent Transfers
- On November 19, 1974, three of PAMBUSCO’s five directors adopted a resolution assigning the corporation’s right of redemption over the foreclosed lots; on March 18, 1975, director Joaquin Briones executed a deed of assignment in favor of Marcelino Enriquez.
- Enriquez redeemed the lots by paying ₱140,474.00 on August 15, 1975; a certificate of redemption was issued the same day.
- On August 16/18, 1975, Enriquez sold the lots to spouses Rising T. Yap and Catalina Lugue for ₱140,000.00; that date also saw annotations of an attachment levy (Capitol Allied Trading), a pending consulta, and notices of assignment and redemption on the original titles.
- On September 10, 1975, the Regional Trial Court (Branch III, Pampanga) ordered a stop to any registration of the assignment, redemption, and sale. On November 17, 1975, the Land Registration Commission conditionally permitted registration in Yap’s name upon presentation of duplicate titles.
- The lots were finally registered in the Yap spouses’ names on June 16, 1978 (new TCT Nos. 148983-R to 148985-R), with the attachment levy noted; the consulta notice was removed. Civil Case No. 4310 (Dante Gutierrez, et al. vs. PAMBUSCO, et al.) was dismissed without prejudice in 1983.
- Despite registration, Pena remained in possession. On December 15, 1978, the Yaps filed an ejectment suit seeking possession and unpaid rentals from October 1974; Pena answered, denying validity of Enriquez’s redemption and sale and asserting the assignment was void.
Issues:
- Jurisdiction and Standing
- Did the trial court lack jurisdiction to annul the PAMBUSCO board resolution and subsequent transfers because such intra-corporate disputes are under SEC jurisdiction?
- Does Rosita Pena, not being a stockholder or officer of PAMBUSCO, have legal standing to challenge the board resolution and related documents?
- Validity of Corporate Actions and Subsequent Transfers
- Is the November 19, 1974 board resolution valid when only three of five directors attended (below the four-director quorum required by PAMBUSCO’s by-laws)?
- Is the March 18, 1975 deed of assignment to Enriquez void or voidable for lack of corporate authority and absence of consideration?
- Are the Yaps purchasers in good faith despite the trial court order enjoining registration and despite underlying corporate irregularities?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)