G.R. No. 143312 - Silverio Jr. vs. Filipino Business Consultants, Inc.

Case Summary (G.R. No. 143312)

Petitioner

Ricardo S. Silverio, Jr.
Esses Development Corporation
Tri-Star Farms, Inc.

Respondent

Filipino Business Consultants, Inc.

Key Dates

September 22, 1995: Deed of Sale with Assumption of Mortgage executed in favor of FBCI.
May 27, 1997: FBCI filed Petition for Consolidation of Title with the Regional Trial Court (RTC) of Balayan, Batangas.
April 20, 1998: RTC issued writ of possession in favor of FBCI.
December 28, 1998: RTC nullified default judgment and recalled writ of possession for fraudulent service of summons.
April 14, 1999: RTC modified its nullification order, upholding FBCI’s possession subject to reimbursement.
November 9, 1999: RTC restored possession to petitioners without requiring reimbursement.
May 8, 2000: RTC reissued writ of possession in favor of petitioners.
May 26, 2000: RTC suspended writ of possession pending hearing on alleged supervening event.
June 15, 2000: RTC lifted suspension to allow the Court of Appeals to resolve the supervening-event issue.

Applicable Law

1987 Philippine Constitution
1997 Rules of Civil Procedure: Rule 39, Section 5 (restitution); Rule 45 (appeal); Rule 65 (certiorari)
Doctrine of separate corporate personality

Procedural Posture

Petitioners seek review of the RTC Balayan’s May 26, 2000 order suspending enforcement of a writ of possession in their favor. FBCI moved to suspend execution on the ground that it had acquired controlling shares of petitioners’ corporations. Petitioners contend that the suspension was based on an improper ex parte motion, that interlocutory orders are non-appealable, and that the court lacked jurisdiction over intra-corporate matters.

Antecedent Facts

Petitioners owned Torrens-titled land in Calatagan, Batangas, covered by TCT No. T-55200. After failing to redeem their mortgage, they executed a Deed of Sale with Assumption of Mortgage in favor of FBCI on September 22, 1995. FBCI filed for consolidation of title, obtained a default judgment, and caused a writ of possession to issue on April 20, 1998. Petitioners successfully moved to nullify that judgment for lack of jurisdiction and to recall the writ. On November 9, 1999, the RTC restored possession to petitioners as restitution.

Issues Raised

Petitioners argue that:

An ex parte motion cannot justify suspending a writ of possession.
The RTC lacked jurisdiction to entertain intra-corporate disputes.
A final and executory judgment cannot be enjoined by interlocutory processes.
FBCI threatened violence to avoid enforcement.
Res judicata bars re-litigation of jus possessionis.

FBCI counters that:

The controversy is moot and academic.
Petitioners engaged in forum shopping.
The RTC had authority to stay execution pending appellate proceedings.
Rule 45 certiorari is the proper remedy.

Remedy for Interlocutory Orders

The Supreme Court held that an order suspending execution of a writ of possession is interlocutory and not appealable under Rule 45. The proper remedy is by petition for certiorari under Rule 65. In the interest of substantial justice, the Court treated the instant petition as one under Rule 65 to address alleged grave abuse of discretion.

Mootness and Forum Shopping

Although the RTC’s June 15, 2000 order purportedly lifted the suspension, petitioners had not regained possession. Thus, the controversy remained live. The separate annulment-of-contract suit filed by petitioners in Las Piñas did not constitute forum shopping, as it involved different parties, causes of action, and reliefs.

Supervening Event Doctrine

A writ of execution may be stayed only by subsequent events that directly affect the rights adjudicated or render enforcement unjust. Here, the default judgment was void ab initio; the writ to petitioners is an order of restitution pending final resolution of title. FBCI’s acquisition of shares in petitioners’ corporations does not alter legal ownership or jus possidendi of the Calatagan property.

Corporate Personality Principle

Under settled juri

Case Syllabus (G.R. No. 143312)

Antecedent Facts

Silverio, Jr. is president and representative of Esses Development Corporation (“Esses”) and Tri-Star Farms, Inc. (“Tri-Star”), both in possession of a 62-hectare land in Calatagan, Batangas, covered by TCT No. T-55200.
On September 22, 1995, Esses and Tri-Star executed a Deed of Sale with Assumption of Mortgage in favor of Filipino Business Consultants, Inc. (“FBCI”).
After failing to redeem, Esses and Tri-Star faced FBCI’s Petition for Consolidation of Title (Civil Case No. 3356) filed May 27, 1997, resulting in a judgment by default; TCT No. T-55200 was canceled and reissued as T-77656 in FBCI’s name.
On April 20, 1998, RTC Balayan issued a writ of possession in FBCI’s favor; FBCI entered the property.
Petitioners moved for relief from judgment, alleging fraudulent summons; on December 28, 1998, RTC Balayan nullified the default judgment and writ of possession, ordering new service of summons.
FBCI’s certiorari petition to the Court of Appeals (CA-G.R. SP No. 56924) and motion for reconsideration were denied; Supreme Court likewise dismissed FBCI’s petition on August 13, 2001.
RTC Balayan’s April 14, 1999 Order initially upheld FBCI’s possession due to improvements but on November 9, 1999 reversed itself, restoring possession to petitioners without reimbursement requirement under Rule 39, § 5, 1997 Rules.
Following denial of FBCI’s reconsideration on January 7, 2000, RTC Balayan issued a writ of possession to petitioners on May 8, 2000.
FBCI filed ex parte motions (Manifestation and Motion to Recall, Urgent Motion to Suspend) claiming pending CA motion and acquisition of controlling shares in Esses and Tri-Star as a supervening event.
On May 26, 2000, after hearing, RTC Balayan suspended the writ to avoid forum shopping and potential violence; scheduled and later canceled hearings on the supervening event to await the appellate resolution.
Petitioners later filed an annulment of contracts case (LP-00-0163) against FBCI in RTC Las Piñas.

Procedural History

RTC Balayan: consolidated t