Case Digest (G.R. No. 140338)
Facts:
Republic Telecommunications Holdings, Inc. v. Jose L. Santiago et al., G.R. No. 140338, August 07, 2007, Supreme Court Second Division, Tinga, J., writing for the Court.The petitioners named in the caption included Republic Telecommunications Holdings, Inc. (RETELCOM) represented by A2 Telecommunications International Holding Co. Pte. Ltd. (A2 Telecom) and Beauty Fortune Investments, Ltd., together with three members of the Securities, Investigation and Clearing Department (SICD) of the Securities and Exchange Commission (SEC) as nominal parties. The respondents were members of RETELCOM’s Board of Directors — Jose L. Santiago, Marilyn E. Santiago, Eleanor M. Santiago, James B. Lindenberg, Caesar U. Querubin, Hyung Shik Kim, Inho Lee — and RETELCOM’s subsidiaries Philippine Telegraph & Telephone Corporation (PT&T) and Philippine Wireless, Inc. (PWI).
A2 Telecom owned 20% of RETELCOM, Korea Telecoms owned 20%, and TIMCO Holdings, Inc. (wholly owned by the Santiago family) owned the remaining 60%. Pursuant to joint venture agreements, RETELCOM became the holding company of PT&T, PWI and Capitol Wireless. On 5 March 1998, A2 Telecom and Beauty Fortune filed a derivative petition with the SICD (SEC Case No. 03-98-5926) seeking nullification of three RETELCOM Board resolutions dated 23 February 1998 (Resolutions Nos. 98-13, 98-14 and 98-15) that authorized commercial transactions with Qualcomm, Inc., including equipment supply, credit facility and guarantee arrangements allegedly containing grossly disadvantageous terms and misrepresentations.
The SICD issued a temporary restraining order on 9 March 1998 (extended on 12 March 1998) and, after further hearings, ordered the issuance of a writ of preliminary injunction on 27 March 1998 (writ issued 30 March 1998) enjoining the RETELCOM Board from executing or implementing the questioned agreements. The RETELCOM Board petitioned the SEC en banc for certiorari and injunctive relief to nullify the SICD orders; on 7 July 1998 the SEC en banc dismissed those petitions and affirmed the SICD’s actions, finding no grave abuse of discretion and upholding a prima facie finding of bad faith during contract negotiations.
The RETELCOM Board then filed a petition for review with the Court of Appeals (CA-G.R. SP No. 48456). The Court of Appeals issued a TRO on 27 August 1998 enjoining implementation of the SEC/SICD orders. Petitioners brought a petition for certiorari to this Court (G.R. No. 135074); on 9 September 1998 this Court issued a TRO restraining the CA from implementing its resolution, and on 29 January 1999 this Court set aside the CA’s 27 August 1998 TRO for failure to show a clear positive right.
On 3 March 1999 the Court of Appeals rendered a decision in CA-G.R. SP No. 48456 nullifying the SEC en banc and SICD orders and the writ of preliminary injunction, directing the SICD to proceed to the merits of SEC Case No. 03-98-5926. Petitioners then filed the present petition for review on certiorari under Rule 45 (G.R. No. 140338) challenging the Court of Appeals’ decision as beyond its jurisdiction, as overruling this Court, and contrary to fact and law.
Subsequently petitioners filed a ...(Pro-only)
Issues:
- Is the petition for review on certiorari moot and academic due to Qualcomm’s withdrawal from the transactions?
- Did the SICD and the SEC en banc commit reversible error in issuing and upholding the writ of preliminary injunction enjoining the execution of the agreements with Qualcomm?
- Did the Court of Appeals’ decision have the effect of overruling this Court’s Resolution dated 29...(Pro-only)
Ruling:
- (Pro-only)
Ratio:
- (Pro-only)
Doctrine:
- (Pro-only)