Case Digest (G.R. No. 248033)
Facts:
Provincial Government of Cavite and Provincial Treasurer of Cavite v. CQM Management, Inc., G.R. No. 248033, July 15, 2020, the Supreme Court Second Division, Inting, J., writing for the Court.On November 25, 2014, CQM Management, Inc. (respondent) filed a petition for injunction with a prayer for a temporary restraining order and preliminary injunction against the Provincial Government of Cavite and the Provincial Treasurer of Cavite (collectively, petitioners), and against Maxon Systems Philippines, Inc. (Maxon) and Ultimate Electronic Components, Inc. (Ultimate), seeking to enjoin a tax delinquency sale of two properties formerly owned by Maxon and Ultimate in the PEZA ecozone in Rosario, Cavite.
The background involves Philippine Investment One (SPV‑AMC) Inc. (PI One), which in December 1, 2004 acquired from RCBC two non‑performing loans secured by real property mortgages: the Maxon loan (Maxon property, 17,466 sq.m., TD No. 17‑009‑01506) and the Ultimate loan (Ultimate property, 3,000 sq.m., TD No. 17‑0009‑03191). PI One foreclosed, purchased at auction (PI One bought the Maxon property and respondent purchased the Ultimate property at separate sales), and later assigned to respondent PI One’s rights over the Maxon property by deed of assignment dated March 31, 2011; respondent therefore became the subsequent owner of both properties after redemption periods lapsed (absolute ownership dates: Maxon March 2014; Ultimate August 2014).
From the Provincial Treasurer’s records, Maxon and Ultimate had long‑standing unpaid real property taxes (Maxon: ₱15,888,089.09 for years 2000–2013; Ultimate: ₱6,238,407.76 for years 1997–2013). The Provincial Treasurer issued assessments, levies, and scheduled public auctions (set for December 10, 2014) to satisfy those arrears. Respondent could not secure transfer of tax declarations because of the unpaid taxes and, on learning of the impending auctions, filed the injunction petition; the RTC issued a timely preliminary writ stopping the sale.
Branch 65, Regional Trial Court, Makati City rendered a decision on February 19, 2016 granting permanent injunctive relief in favor of CQM, holding that respondent was exempt from the contested real property taxes under Section 24 of Republic Act No. 7916 (as amended by RA 8748) and, alternatively, that principles of laches and estoppel and equity barred the Provincial Government from collecting those taxes. The RTC denied petitioners’ motion for reconsideration in a July 7, 2016 resolution.
The Court of Appeals, in CA‑G.R. CV No. 107654, affirmed in a Decision dated May 23, 2018 (authored by Associate Justice Peralta, Jr., with Associate Justices Rosario and Martin concurring). The CA held respondent was not the owner or beneficial possessor during the years the taxes accrued and thus could not be held liable; the CA also found the properties exempt under Section 24 of RA 7916 (and noted respondent’s PEZA registration and leas...(Subscriber-Only)
Issues:
- Did petitioners sufficiently show that the Court of Appeals committed reversible error in affirming the RTC’s injunction against conducting a tax delinquency sale?
- Can CQM Management, Inc. be held liable for unpaid real property taxes that accrued before it acquired ownership or beneficial possession of the subject properties?
- Are the Maxon and Ultimate properties exempt from real property taxation under Section 24 of RA 7916, as amended, and related implementing rules and PEZA guidance?
- Were some of the tax assessments time‑barred by prescription under Section 270 of ...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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