Case Digest (G.R. No. 178899)
Facts:
Philippine Business Bank v. Felipe Chua, G.R. No. 178899, November 15, 2010, Supreme Court Third Division, Brion, J., writing for the Court.In 2002, Tomas Tan (plaintiff) filed a derivative action (Civil Case No. 02-299) in the Makati RTC against, among others, Philippine Business Bank (PBB) and Felipe Chua (respondent) alleging that titles of CST Enterprises, Inc. (CST) were fraudulently used as collateral for loans obtained by John Dennis Chua without proper corporate authority. Tan's amended complaint alleged that a Secretary’s Certificate authorized John Dennis Chua to obtain credit and to use CST properties as security.
PBB answered and cross-claimed against Felipe Chua, alleging liability on six promissory notes signed by Chua as co-maker. Chua admitted signing the notes but claimed he did so only to persuade John Dennis Chua to pay the debt and to recover CST titles; he denied ever authorizing or applying for the loans. PBB moved for Partial Summary Judgment under Section 1, Rule 35 of the Rules of Court on its cross-claim against Chua, relying on his admission and invoking accommodation-party liability under Section 29 of the Negotiable Instruments Law.
The RTC granted partial summary judgment on July 27, 2005, holding Chua liable for P75,000,000.00 and directing payment. On December 16, 2005 the RTC, citing Section 1, Rule 41, ruled that Chua could not appeal the partial summary judgment separately and—finding he had not pursued certiorari within the appropriate period—declared the partial summary judgment final and executory and ordered issuance of a writ of execution. The RTC appointed a special sheriff who levied and sold properties and shares to implement the writ.
Chua filed a petition for certiorari and mandamus with the Court of Appeals (CA) challenging the RTC’s disallowance of his appeal and the issuance/implementation of the writ of execution (not challenging the partial summary judgment’s correctness). In CA-G.R. SP No. 94883 (pened by Associate Justice Conrado M. Vasquez, Jr.), the CA (Feb. 8, 2007) affirmed the disallowance of a separate appeal under Section 1(g), Rule 41 but held the RTC gravely abused its discretion in issuing the writ because a partial summary judgment is interlocutory and cannot become final and executory; the CA set aside the writ and related execution proceedings. PBB’s motion for reconsideration was denied by the CA on July 18, 2007.
PBB filed a petition for review on certiorari under Ru...(Pro-only)
Issues:
- Did the Court of Appeals err in applying prior jurisprudence to the factual circumstances of this case?
- Did the Court of Appeals err in recalling and setting aside the writ of execution on the ground that the partial summary judgment had not become fi...(Pro-only)
Ruling:
- (Pro-only)
Ratio:
- (Pro-only)
Doctrine:
- (Pro-only)