Case Digest (G.R. No. L-65622)
Facts:
Leonides C. Pengson v. The Intermediate Appellate Court, Reynolds Philippine Corporation, William W. Duncan, Jr., Pacific Merchandising Corporation and Sheriff of Quezon City, G.R. No. L-65622, June 29, 1984, Supreme Court Second Division, Abad Santos, J., writing for the Court.
Petitioner Leonides C. Pengson instituted Civil Case No. Q-15060 in the defunct Court of First Instance of Rizal against Reynolds Philippine Corporation (Reynolds) and others, seeking declaration of nullity and ineffectivity of a sale (Exhibit A) and an accessory mortgage (Exhibit B), rescission and damages, after Reynolds allegedly refused to deliver stock certificates that were the subject of the sale. The factual narrative in the record shows that Pacific Merchandising Corporation (PMC) owned approximately 96% of Aluminum Products (Alpro) and had pledged its Alpro shares to Reynolds as collateral for a loan exceeding P800,000. PMC agreed to sell those shares to Pengson; under the sale Pengson assumed PMC’s obligation to Reynolds, the indebtedness purportedly being reduced to P500,000, and Pengson mortgaged a parcel of land to Reynolds as security for the P500,000 to be paid in five annual installments.
The trial court found for Pengson, concluding that Reynolds’ refusal to deliver the pledged stock certificates — after having given consent to the sale — effectively withdrew that consent and rendered the sale (Exhibit A) and the accessory mortgage (Exhibit B) ineffectual; it declared the foreclosure and public auction null and void, ordered reinstatement of title records and cancellation of the mortgage encumbrance, and ordered Reynolds to return payments and pay attorney’s fees and costs.
Reynolds appealed. The Intermediate Appellate Court (IAC) reversed the trial court, holding that Reynolds was not a party to the contract of sale between PMC and Pengson and therefore had no obligation to deliver the pledged certificates to Pengson; the IAC reasoned that Pengson had become the new debtor to Reynolds by assuming PMC’s obligation and that there was no agreement obligating Reynolds to return the certificates. The IAC entered judgment in favor of Reynolds awarding sums (itemized in the IAC decision) with interest and attorney’s fees against Pengson’s estate.
Pengson filed a petition for review on certiorari with the Supreme Court asking (1) that the IAC decision be reversed and the trial court judgment reinstated, or alternatively (2) that a writ of mandamus issue commanding the IAC to make complete findings of fact. The Supreme Court found the IAC’s factual statements “sketchy” compared to the trial court record and to the extensive factual assert...(Subscriber-Only)
Issues:
- Should the Supreme Court grant the petition and reverse the decision of the Intermediate Appellate Court and reinstate the trial court judgment?
- Should the Supreme Court issue a writ of mandamus (or otherwise order) compelling the Intermediate Appellate Court to make complete findings of fact and to ...(Subscriber-Only)
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)