Cases Corpo Sec 86-95 (Non-stock)

8/13/2019 Cases Corpo Sec 86-95 (Non-stock)

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FIRST DIVISION

[G.R. No. 146807. May 9, 2002]

PADCOM CONDOMINIUM CORPORATION,petitioner, vs. ORTIGAS CENTER ASSOCIATION, INC., respondent.

D E C I S I O N

DAVIDE, R., C.J.!

Challenged in this case is the 30 June 2000 decision [1]o the Cou!t o "##eals in C"$%&R& CV No& '00(() !e*e!sing asetting aside the 1 Se#te+,e! 1((- decision[2]o the Regional T!ial Cou!t o .asig Cit/) !anch 2') in Ci*il Case No& '3[3]

.etitione! .adco+ Condo+iniu+ Co!#o!ation he!eate! ."DCO45 o6ns and +anages the .adilla Oice Condo+inuilding ."DCO4 uilding5 located at 7+e!ald "*enue) O!tigas Cente!) .asig Cit/& The land on 6hich the ,uilding sta6as o!iginall/ ac8ui!ed !o+ the O!tigas 9 Co+#an/) :i+ited .a!tne!shi# OC:.5) ,/ Tie!!a De*elo#+ent Co!#o!ation Tunde! a Deed o Sale dated Se#te+,e! 1(-& "+ong the te!+s and conditions in the deed o sale 6as the !e8ui!e+that the t!anse!ee and its successo!$in$inte!est +ust ,eco+e +e+,e!s o an association o! !ealt/ o6ne!s and long$te

essees in the a!ea late! ;no6n as the O!tigas Cente!& Su,se8uentl/) the said lot) togethe! 6ith i+#!o*e+ents the!eon) 6con*e/ed ,/ TDC in a*o! o ."DCO4 in a Deed o T!anse! dated 2< Fe,!ua!/ 1(-tensions o #a/+ent) ae*en a settle+ent sche+e #!o#osed ,/ ."DCO4 in Se#te+,e! 1((0&

In *ie6 o ."DCO4?s ailu!e and !eusal to #a/ its a!!ea!s in +onthl/ dues) including inte!ests and #enalties the!ethe "ssociation iled a co+#laint o! collection o su+ o +one/ ,eo!e the t!ial cou!t ,elo6) 6hich 6as doc;eted as CCase No& '301& The "ssociation a*e!!ed that #u!chase!s o lands 6ithin the O!tigas Cente! co+#le> !o+ OC:. o,ligated unde! thei! cont!acts o sale to ,eco+e +e+,e!s o the "ssociation& This o,ligation 6as allegedl/ #assed on."DCO4 6hen it ,ought the lot !o+ TDC) its #!edecesso!$in$inte!est&[']

In its ans6e!) ."DCO4 contended that it is a non$stoc;) non$#!oit association) and o! it to ,eco+e a s#ecial +e+o the "ssociation) it should i!st a##l/ o! and ,e acce#ted o! +e+,e!shi# ,/ the latte!?s oa!d o Di!ecto!s& No auto++e+,e!shi# 6as a##a!entl/ conte+#lated in the "ssociation?s /$la6s& ."DCO4 added that it could not ,e co+#elled,eco+e a +e+,e! 6ithout *iolating its !ight to !eedo+ o association& "nd since it 6as not a +e+,e! o the "ssociatio6as not lia,le o! +e+,e!shi# dues) inte!ests and #enalties&[-]

Du!ing the t!ial) the "ssociation #!esented its accountant as lone 6itness to #!o*e that ."DCO4 6as) indeed) one o+e+,e!s and) as such) did not #a/ its +e+,e!shi# dues&

."DCO4) on the othe! hand) did not #!esent its e*idence@ instead it iled a +otion to dis+iss ,/ 6a/ o de+u!!ee*idence& It alleged that the acts esta,lished ,/ the "ssociation sho6ed no !ight to the !elie #!a/ed o!& It clai+ed tthe #!o*isions o the "ssociation?s /$la6s and the Deed o T!anse! did not conte+#late auto+atic +e+,e!shi#& Ratthe o6ne! o! long$te!+ lessee ,eco+es a +e+,e! o the "ssociation onl/ ate! a##l/ing 6ith and ,eing acce#ted ,/oa!d o Di!ecto!s& "ssu+ing u!the! that ."DCO4 6as a +e+,e! o the "ssociation) the latte! ailed to sho6 that collection o +onthl/ dues 6as a *alid co!#o!ate act dul/ autho!i=ed ,/ a #!o#e! !esolution o the "ssociation?s oa!dDi!ecto!s&[]

"te! due conside!ation o the issues !aised in the +otion to dis+iss) the t!ial cou!t !ende!ed a decision dis+issing co+#laint&[(]

The "ssociation a##ealed the case to the Cou!t o "##eals) 6hich doc;eted the a##eal as C"$%&R& CV No& '00((& Indecision[10]o 30 June 2000) the Cou!t o "##eals !e*e!sed and set aside the t!ial cou!t?s dis+issal o Ci*il Case No& '3and dec!eed as ollo6sA

"#ERE$ORE) the a##ealed decision dated Se#te+,e! 1) 1((- is REVERSEDand SETASIDEand) in lieu the!eo) a none is ente!ed o!de!ing the a##ellee ."DCO45 to #a/ the a##ellant the "ssociation5 the ollo6ingA
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15 .'3()('1&- as and o! +e+,e!shi# dues in a!!ea!s inclusi*e o ea!ned inte!ests and #enalties@ and

25 .2tensions) and e*en #!o#osed a sche+e o! the settle+ent o its o,ligation& The Coo "##eals also !uled that ."DCO4 cannot e*ade #a/+ent o its o,ligation to the "ssociation 6ithout *iolating e8uita#!inci#les unde!l/ing 8uasi$cont!acts& eing co*e!ed ,/ the "ssociation?s a*o6ed #u!#ose to #!o+ote the inte!ests a6ela!e o its +e+,e!s) ."DCO4 cannot ,e allo6ed to e>#edientl/ den/ and a*oid the o,ligation a!ising !o+ s

+e+,e!shi#&

Dissatisied 6ith the ad*e!se Budg+ent o the Cou!t o "##eals) ."DCO4 iled the #etition o! !e*ie6 in this case!aises the sole issue o 6hethe! it can ,e co+#elled to Boin the association #u!suant to the #!o*ision on autommembershipa##ea!ing as a condition in the Deed o Sale o 0 Se#te+,e! 1(- and the annotation the!eo on T!ans

Ce!tiicate o Title No& #enses o ho+eo6ne!s o! necessa!/ se!*ices&

"te! a ca!eul e>a+ination o the !eco!ds o this case) the Cou!t sees no !eason to distu!, the assailed decision& #etition should ,e denied&

Section o .!esidential Dec!ee No& 1ce#t those noted on said ce!tiicate and an/ o the ollo6ing encu+,!an

6hich +a/ ,e su,sisting) na+el/A >>>

nde! the To!!ens s/ste+ o !egist!ation) clai+s and liens o 6hate*e! cha!acte!) e>ce#t those +entioned ,/ le>isting against the land ,inds the holde! o the title and the 6hole 6o!ld&[12]

It is undis#uted that 6hen the land in 8uestion 6as ,ought ,/ ."DCO4?s #!edecesso!$in$inte!est) TDC) !o+ OC:.) sale ,ound TDC to co+#l/ 6ith #a!ag!a#h %5 o the co*enants) conditions and !est!ictions o the Deed o Sale) 6hich !e

as ollo6sA[13]

%& "TO4"TIC 4747RSGI. HITG TG7 "SSOCI"TIONA
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The o6ne! o this lot) its successo!$in$inte!est he!e,/ ,inds hi+sel to ,eco+e a +e+,e! o the "SSOCI"TION 6hich 6ilo!+ed ,/ and a+ong #u!chase!s) ull/ #aid u# :ot 7RS) uilding O6ne!s and the CO4."N in !es#ect to CO4."

OHN7D :OTS&

The OHN7R o this lot shall a,ide ,/ such !ules and !egulations that shall ,e laid do6n ,/ the "SSOCI"TION in the inte!o secu!it/) +aintenance) ,eautiication and gene!al 6ela!e o the OFFIC7 I:DIN% =one& The "SSOCI"TION 6o!gani=ed shall also) a+ong othe!s) #!o*ide o! and collect assess+ents 6hich shall constitute a lien on the #!o#e!t/) Bunonl/ to liens o the %o*e!n+ent o! ta>es&

7*identl/) it 6as ag!eed ,/ the #a!ties that dues shall ,e collected !o+ an auto+atic +e+,e! and such eesassess+ents shall ,e a lien on the #!o#e!t/&

This sti#ulation 6as li;e6ise annotated at the ,ac; o T!anse! Ce!tiicate o Title No&


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Ga*ing !uled that ."DCO4 is a +e+,e! o the "ssociation) it is o,ligated to #a/ its dues incidental the!eto& "!t11#ense o anothe!&

%ene!all/) it +a/ ,e said that a 8uasi$cont!act is ,ased on the #!esu+ed 6ill o! intent o the o,ligo! dictated ,/ e8uand ,/ the #!inci#les o a,solute Bustice& 7>a+#les o these #!inci#les a!eA 15 it is #!esu+ed that a #e!son ag!ees to t6hich 6ill ,eneit hi+@ 25 no,od/ 6ants to en!ich hi+sel unBustl/ at the e>#ense o anothe!@ o! 35 one +ust do uothe!s 6hat he 6ould 6ant othe!s to do unto hi+ unde! the sa+e ci!cu+stances&[1(]

"s !esident and lot o6ne! in the O!tigas a!ea) ."DCO4 6as deinitel/ ,eneited ,/ the "ssociation?s acts and acti*ito #!o+ote the inte!ests and 6ela!e o those 6ho ac8ui!e #!o#e!t/ the!ein o! ,eneit !o+ the acts o! acti*ities o "ssociation&

Finall/) ."DCO4?s a!gu+ent that the collection o +onthl/ dues has no ,asis since the!e 6as no ,oa!d !esoludeining ho6 +uch ees a!e to ,e i+#osed dese!*es scant conside!ation& Suice it is to sa/ that ."DCO4 ne*e! #!otesu#on !ecei#t o the ea!lie! de+ands o! #a/+ent o +e+,e!shi# dues& In act) ,/ #!o#osing a sche+e to #a/ its o,ligat."DCO4 cannot ,elatedl/ 8uestion the "ssociation?s autho!it/ to assess and collect the ees in acco!dance 6ith the tand a!ea o6ned o! occu#ied ,/ the +e+,e!s) 6hich inds su##o!t in a !esolution dated ' No*e+,e! 1(2 o "ssociation?s inco!#o!ating di!ecto!s[20]and Section 2 o its /$la6s&[21]

"#ERE$ORE) the #etition is he!e,/ D7NI7D o! lac; o +e!it&

Costs against #etitione!&

SO ORDERED.

Puno, Kapunan, Ynares-Santiago, andAustria-Martinez, ., concu!&

TGIRD DIVISION

[G.R. No. 141961. a%&a'y 2(, 2002]
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STA. C)ARA #OMEO"NERS* ASSOCIATION +'& -+ /oa' o D-'3+o' 3o5o o ARNEI) C#UA, )USARROSA, OCE)N GARCIA, MA. MI)AGROS VARGAS, )ORENO )ACSON, ERNESTO PICCIO, DIN

I)AGAN, DANI)O GAM/OA R. a% RIA DE )A RAMA SECURIT GUARD CAPI))O O#N DOE: aSANTA C)ARA ESTATE, INC.,petitioners, vs. S5o& VICTOR MA. GASTON a% )DGASTON,respondents.

D E C I S I O N

PANGANI/AN,J.!

" +otion to dis+iss ,ased on lac; o Bu!isdiction and lac; o cause o action h/#otheticall/ ad+its the t!uth o allegations in the co+#laint& It is not de#endent on the #leas o! the theo!ies set o!th in the ans6e! o! the +otiondis+iss& 4e+,e!shi# in a ho+eo6ne!s? association is *olunta!/ and cannot ,e unilate!all/ o!ced ,/ a #!o*ision in association?s a!ticles o inco!#o!ation o! ,/$la6s) 6hich the alleged +e+,e! did not ag!ee to ,e ,ound to&

S+a+%+ o + Ca

The .etition o! Re*ie6 ,eo!e us assails the "ugust 31) 1((( Decision[1]and the Fe,!ua!/ 11) 2000 Resolution[2]o Cou!t o "##eals C"5 in C"$%R S. No& (130& The dec!etal #o!tion o the challenged Decision !eads as ollo6sA

HG7R7FOR7) the #etition is DIS4ISS7D o! lac; o +e!it& The assailed O!de!s o the t!ial cou!t a!e "FFIR47D& No costs&

The assailed Resolution denied #etitione!?s 4otion o! Reconside!ation&

The C"[]ai!+ed the O!de!s[


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On "#!il 1(() #etitione!s he!ein iled a +otion to dis+iss a!guing that the t!ial cou!t ha[d] no Bu!isdiction o*e! the cas it in*ol*e[d] an int!a$co!#o!ate dis#ute ,et6een SCG" and its +e+,e!s #u!suant to Re#u,lic "ct No& ecuti*e O!de! Nos& isted ,et6een the SCG" and !es#ondents& The C" held tthe Co+#laint had stated a cause o action& It li;e6ise o#ined that Bu!isdiction and cause o action 6e!e dete!+ined ,/ allegations in the co+#laint and not ,/ the deenses and theo!ies set u# in the ans6e! o! the +otion to dis+iss&

Gence) this .etition&[]

I&

In thei! 4e+o!andu+) #etitione!s !aise the ollo6ing issues o! the Cou!t?s conside!ationA

I

Hhethe! o! not Res#ondent Cou!t o "##eals e!!ed in u#holding the Bu!isdiction o the cou!t a 8uo) Kto decla!e as null *oid the !esolution o the oa!d o SCG") dec!eeing that onl/ +e+,e!s [in] good standing o the said association) 6e!,e issued stic;e!s o! use in thei! *ehicles&

II

Hhethe! o! not #!i*ate !es#ondents a!e +e+,e!s o SCG"&

III
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Hhethe! o! not Res#ondent Cou!t o "##eals e!!ed in not o!de!ing the dis+issal o the Co+#laint in Ci*il Case No& 1021- o! lac; o cause o action&[(]

In su+) the issues ,oil do6n to t6oA 15 Did the RTC ha*e Bu!isdiction o*e! the Co+#laintM and 25 Did the Co+#lstate a cause o actionM

T- Co&'+* R&;-%


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The a,o*e !uling) ho6e*e!) does not a##l/ to the case at ,a!& Hhen #!i*ate !es#ondents #u!chased thei! #!o#e!t/1(- and o,tained T!anse! Ce!tiicates o Title Nos& T$12'ists& .etitione!s #that #!i*ate !es#ondents all 6ithin the +eaning o gene!al #u,lic& He a!e not con*inced&

irst) the thi!d t/#e o dis#ute !ee!s onl/ to cases 6he!ein an association?s !ight to e>ist as a co!#o!ate entit/ isissue& In the #!esent case) the Co+#laint iled ,/ #!i*ate !es#ondents !ee!s to the SCG"?s acts allegedl/ a+ounting toi+#ai!+ent o thei! !ee access to thei! #lace o !esidence inside the Sta& Cla!a Su,di*ision& [2-]The e>istence o SCG" aco!#o!ate entit/ is clea!l/ not at issue in the instant case&

Second, in nited & /omeo*ners0 Association ). & /omes, (nc.,[2]6e held that Section 1,5) Ruleo GI%C?s Re*ised Rules o .!ocedu!e in the Gea!ing o Go+eo6ne!s? Dis#utes 6as *oid& The GI%C 6ent ,e/ond its la6autho!it/ #!o*ided ,/ la6 6hen it #!o+ulgated its !e*ised !ules o #!ocedu!e& The!e 6as a clea! atte+#t to undul/ e>#athe #!o*isions o .!esidential Dec!ee (02$"& "s #!o*ided ,/ the la6) it is onl/ the State $$ not the gene!al #u,lic o! otentit/ $$ that can 8uestion an association?s !anchise o! co!#o!ate e>istence&[2(]

To !eite!ate) the GI%C e>e!cises li+ited Bu!isdiction o*e! ho+eo6ne!s? dis#utes& The la6 conines its autho!it/cont!o*e!sies that a!ise !o+ an/ o the ollo6ing int!a$co!#o!ate !elationsA 15 ,et6een and a+ong +e+,e!s o association@ 25 ,et6een an/ ando! all o the+ and the association o 6hich the/ a!e +e+,e!s@ and 35 ,et6een association and the stateinsoa! as the cont!o*e!s/ conce!ns its !ight to e>ist as a co!#o!ate entit/.[30]

It should ,e st!essed that the Co+#laint he!e is o! da+ages& It does not asse!t +e+,e!shi# in the SCG" as its ,aRathe!) it is ,ased on an alleged *iolation o thei! alleged !ight o access th!ough the su,di*ision and on the allee+,a!!ass+ent and hu+iliation sue!ed ,/ the #laintis&

S3o% I&! Su!!icienc o! Cause o! Action

.etitione!s clai+ that the C" e!!ed in not o!de!ing the dis+issal o the Co+#laint o! lac; o cause o action& Ta!gue that the!e 6as no allegation the!ein that #!i*ate !es#ondents 6e!e actuall/ #!e*ented !o+ ente!ing the su,di*isand gaining access to thei! !esidential a,ode&

This contention is untena,le& " deendant +o*ing to dis+iss a co+#laint on the g!ound o lac; o cause o actio!ega!ded as ha*ing h/#otheticall/ ad+itted all the actual a*e!+ents in the co+#laint& The test o the suicienc/ o allegations constituting the cause o action is 6hethe!) ad+itting the acts alleged) the cou!t can !ende! a *alid Budg+entthe #!a/e!s&[31]This test i+#lies that the issue +ust ,e #assed u#on on the ,asis o the ,a!e allegations in the co+#laThe cou!t does not in8ui!e into the t!uth o such allegations and decla!e the+ to ,e alse& To do so 6ould constitut#!ocedu!al e!!o! and a denial o the #lainti?s !ight to due #!ocess&[32]

" co+#laint states a cause o action 6hen it contains these th!ee essential ele+entsA 15 the legal !ight o the #lain25 the co!!elati*e o,ligation o the deendant) and 35 the act o! o+ission o the deendant in *iolation o the said le!ight&[33]

In the instant case) the !eco!ds suicientl/ esta,lish a cause o action& irst, the Co+#laint alleged that) unde! Constitution) !es#ondents had a !ight o !ee access to and !o+ thei! !esidential a,ode& Second, unde! the la6) #etition
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ha*e the o,ligation to !es#ect this !ight& $hird, such !ight 6as i+#ai!ed ,/ #etitione!s 6hen #!i*ate !es#ondents 6!eused access th!ough the Sta& Cla!a Su,di*ision) unless the/ sho6ed thei! d!i*e!?s license o! identiication&

%i*en these h/#otheticall/ ad+itted acts) the RTC) in the e>e!cise o its o!iginal and e>clusi*e Bu!isdiction) [3]coha*e !ende!ed Budg+ent o*e! the dis#ute&

He st!ess that) in !ende!ing this Decision) this Cou!t is not #!eBudging the +ain issue o 6hethe!) in t!uth and in a#!i*ate !es#ondents a!e entitled to a a*o!a,le decision ,/ the RTC& That 6ill ,e +ade onl/ ate! the #!o#e! #!oceedthe!ein& :ate! on) i it is #!o*en du!ing the t!ial that the/ a!e indeed +e+,e!s o the SCG") then the case +a/ ,e dis+ison the g!ound o lac; o Bu!isdiction& He a!e +e!el/ holding that) on the ,asis o the allegations in the Co+#laint) 15 RTC has Bu!isdiction o*e! the cont!o*e!s/ and 25 the Co+#laint suicientl/ alleges a cause o action& The!eo!e) it is

su,Bect to attac; ,/ a +otion to dis+iss on these g!ounds&

"#ERE$ORE) the .etition is he!e,/ %12(1%andthe assailed DecisionA(RM1%& Costs against #etitione!s&

SO ORDERED.

Melo, 3#hairman4, Sando)al-5utierrez, and #arpio, ., concu!&'itug, ., I concu! although I +ight call attention to "!ticle 21- o the Ci*il Code as and 6hen #e!tinent&

Re#u,lic o the .hili##iSUPREME COU4anila
http://sc.judiciary.gov.ph/jurisprudence/2002/jan2002/141961.htm#_edn34http://sc.judiciary.gov.ph/jurisprudence/2002/jan2002/141961.htm#_edn34


11/28

TGIRD DIVISION

G.R. No. 1(496(=64 S5+>' 27, 2001

A)$REDO )ONG a% $E)I? A)MERIA,#etitione*s&)DIA /ASA, ANT#ON SA#EE)IAM a% AO C#E@,!es#ondents&

>$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$>

G.R. NOS. 1(12=( S5+>' 27, 2001

)IM C#E /OON, TAN #ON @OC, OSEP# )IM a% )IU E@ SEE,#etitione

*s&)DIA /ASA, ANT#ON SA#EE)IAM a% AO C#E@,!es#ondents&

>$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$>

G.R. NO. 1(71( S5+>' 27, 2001

)IM C#E /OON, TAN #ON @OC, OSEP# )IM a% )IU E@ SEE,#etitione*s&

)DIA /ASA, ANT#ON SA#EE)IAM a% AO C#E@,!es#ondents&

SANDOVA)=GUTIERRE,J.!

These a!e consolidated cases in*ol*ing a !eligious co!#o!ation 6hose oa!d o Di!ecto!s had e>#elled ce!tain +e+,the!eo on #u!el/ s#i!itual o! !eligious g!ounds since the/ !eused to ollo6 its teachings and doct!ines& The cont!o*e!s/ hcente!s on the legalit/ o the e>#ulsion&

The acts) as ound ,/ the Cou!t o "##eals and as culled !o+ the *olu+inous !eco!ds o these cases) +a/ ,e statedollo6sA

In 1(-3) a !eligious g!ou# ;no6n as The Chu!ch In ue=on Cit/ Chu!ch "sse+,l/ Gall5) Inco!#o!ated CGRCG,!e*it/5) located at 10 Tala/an St&) Tala/an Village) ue=on Cit/) 6as o!gani=ed as an entit/ o the ,!othe!hood

Ch!ist&1

It 6as !egiste!ed in the sa+e /ea! 6ith the Secu!ities and 7>change Co++ission S7C5 as a non$stoc;) non$#!oit !eligico!#o!ation o! the ad+inist!ation o its te+#o!alities o! the +anage+ent o its #!o#e!ties&2

The "!ticles o Inco!#o!ation and /$la6s o the CGRCG dec!ee that its aai!s and o#e!ation shall ,e +anaged ,/ a oo Di!ecto!s consisting o si> '5 +e+,e!s)36ho shall ,e +e+,e!s o the CGRCG&

"s a ,!othe!hood in Ch!ist) the CGRCG e+,!aced the .!inci#les o Faith that e*e!/ +e+,e! o! oice! the!eo sh6ithout +ental !ese!*ation) adhe!e st!ictl/ to the doct!ine) teaching and aith ,eing o,se!*ed ,/ the CGRCG5#!oclai+ing the %os#el o Ch!ist) to sa*e lost souls) to lead +en in 6o!shi##ing the t!ue %od) in acco!dance 6ith the Gi,le and to ,elie*eA

a5 The Old and the Ne6 Testa+ents co+#!ising the Gol/ i,le as ins#i!ed ,/ %od@

,5 The T!init/ o the %od$Gead) 6hich is %od the Fathe!) %od the Son and %od the Gol/ S#i!it&

c5 That Jesus Ch!ist) the onl/ ,egotten Son o the :i*ing %od) concei*ed ,/ the Vi!gin 4a!/ th!ough the Gol/ S#and #ossessing the natu!e o ,oth %od and +an) and 6ho died on the c!oss to sa*e +an;ind) 6as ,u!ied) !ose agon the thi!d da/) has ascended u# to hea*en) and 6ill co+e ,ac; to !eign as Ling so+eda/&

d5 That the onl/ 6a/ to sal*ation is solel/ ,/ t!usting on the shed ,lood o Jesus and the con*iction o the GS#i!it&


12/28


13/28

The u#dated +e+,e!shi# list a##!o*ed ,/ the oa!d on "ugust 30) 1((3) togethe! 6ith the +inutes o the +eeting) 6dul/ iled 6ith the S7C on Se#te+,e! 13) 1((3&2

On Se#te+,e! 2() 1((3) #etitione!s :i+ Che oon) Tan Gon Loc) Jose#h :i+) :iu e; See and othe!s 8uestioned the>#ulsion ,/ iling 6ith the S7C Secu!ities In*estigation and Clea!ing De#a!t+ent a #etition)2


14/28

Gence) the #!esent consolidated #etitions o! !e*ie6 ,/ Ce!tio!a!i %&R& Nos& 13('3$' and %&R& Nos& 13#ulsion is *oid since it 6as !ende!ed 6ithout #!io! notice to the+ o!) in a constitutional conte6ithout due #!ocess&

On the othe! hand) !es#ondents asse!t that the e>#ulsion is in acco!dance 6ith the /$la6s o the CGRCG&

He !ule against the #etitione!s&

It +ust ,e e+#hasi=ed that the issue o the *alidit/ o the e>#ulsion had long ,een !esol*ed and decla!ed *alid ,/ S7C en bancin its decision dated Jul/ 11) 1(( in S7C 7 Case No& 3(& The decision ai!+ed the o!de! dated Fe,!ua!/ 1(( o S7C Gea!ing Oice! 4anuel .e!ea in S7C Case No& 0($(3$a%3 '%' -+ 3--o% a+ &;y 11, 1994 &+a-%-%< #a'-%< O-3' P'a

+ 'a+-o3-%a+-o% +a+ + 5&;-o% o >' 3+ o% A&y + >oa' o -'3+Ba Fa;- aF-%< >% o% -% a33o'a%3 B-+ + >ay=;aB o + C#URC#) and although the he

!es#ondents no6 #etitione!s5 su,se8uentl/ sought the dis+issal o S7C Case No& 0($(3$' 2, 199 a% a%&19, 1996, B-3 B' ;Fa+, +- +- >y + '-% 5+-+-o%' %oB '5o%%+, +o + SECbanc-% a 5+-+-o% o' 'F-B o% 3'+-o'a'- o3H+ a SEC E/ Ca No. 484 & It 6as in this latte! case tthe S7C en banchanded do6n its assailed o!de! o Jul/ 31) 1((' -% F-o;a+-o% o + ;aB o + 3a +a+ Ba';-' ;a- oB% B-+ -%a;-+y -% SEC E/ Ca No. (89 &

> > > > > > > > >

T&;y, + &+-o% o% + Fa;--+y o + 5&;-o% o o o + >' o + C#URC# B&a';y 'a- a% 'o%+a;;y 'o;F -% + 3--o% '%' -% SEC E/ Ca No. (89.37+#hasis ou!

Clea!l/) the issuance ,/ the S7C en banco its Jul/ 31) 1((' o!de! in S7C 7 Case No& ) 6hich reopenedthe *e!/ saissue o the *alidit/ o the e>#ulsion #!oceedings) completely re)ersingits final and eecutory en banc decision of uly 677: 3S1# 1& #ase 2o. 9874) is ce!tainl/ in g!oss dis!ega!d o the !ules and ,asic legal #!ece#t that acco!d inalit/ad+inist!ati*e) 8uasi$Budicial and Budicial dete!+inations&

The Cou!t o "##eals is) the!eo!e) co!!ect in *oiding the S7C en ,anc o!de!s dated Jul/ 31) 1((' and Janua!/ 2() 1((S7C 7 Case No& ) the!e,/ u#holding the e>#ulsion o #etitione!s and othe!s ,/ the oa!d o Di!ecto!s on "ugust 1((3&

In this !ega!d) 6hat 6e said in ortich )s. #orona, et al&3(,ea!s !e#eatingA The o!de!l/ ad+inist!ation o Bustice !e8uthat the Budg+ents!esolutions o a cou!t o! 8uasi$Budicial ,od/ must reach a point of finality set by the la*, rules aregulations& The no,le #u!#ose is to 6!ite inis to dis#utes once and o! all& $his is a fundamental principle in our "us


15/28

system) 6ithout 6hich the!e 6ould ,e no end to litigations& tmost respect and adherence to this principle must al*aysmaintained by those *ho *ield the po*er of ad"udication. Any act *hich )iolates such principle must immediately be strdo*n&0

:et it not ,e said that the denial o the #!esent #etitions) e*en on this g!ound alone) is a +e!e technicalit/& In the ao!ecicase o ortich )s. #orona) 6e held that once a case had ,een !esol*ed 6ith inalit/) *ested !ights 6e!e ac8ui!ed ,/ 6inning #a!t/&1Conse8uentl/) the !ule on inalit/ o decisions) o!de!s o! !esolutions o a Budicial) 8uasi$Budicialad+inist!ati*e ,od/ is not a !uestion of technicality but of substance and merit)2the unde!l/ing conside!ation the!e,eing the #!otection o the su,stanti*e !ights o the 6inning #a!t/&3In the succinct 6o!ds o 4!& Justice "!te+io.angani,an in the case o 'ideogram Regulatory &oard )s. #ourt of Appeals, et al&)Just as a losing #a!t/ has the !igh

ile an a##eal 6ithin the #!esc!i,ed #e!iod) the *inning party also has the correlati)e right to en"oy the finality of resolution of his#ulsion 6as e>ecuted 6ithout #!io! notice o! due #!oces

In the i!st #lace) the /$la6s o the CGRCG) 6hich the +e+,e!s ha*e e>#!essl/ adhe!ed to) does not!e8ui!e the oa!Di!ecto!s to gi*e #!io! notice to the e!!ing o! dissident +e+,e!s in cases o e>#ulsion& This is e*ident !o+ the #!ocedu!ee>#ulsion #!esc!i,ed in "!ticle VII #a!ag!a#h 5 o the /$la6s) 6hich !eadsA

& I it is brought to the notice of the &oard of %irectorsthat an/ +e+,e! has failed to obser)e any regulations &y-la*s of the (nstitutionCGRCG5 or the conduct of any member has been dishonorable or improper or other*in"urious to the character and interest of the (nstitution, the &oard of %irectors may b3y4 resolution *ithassigning any reason therefor epel such member!o+ such Institution and he shall then o!eit his inte!est) !ig

and #!i*ileges in the Institution& 7+#hasis ou!s5

F!o+ the a,o*e$8uoted /$la6 #!o*ision) the onl/ !e8ui!e+ents ,eo!e a +e+,e! can ,e e>#elled o! !e+o*ed !o+ +e+,e!shi# o the CGRCG a!eA a5 the oa!d o Di!ecto!s has ,een notiied that a +e+,e! has ailed to o,se!*e !egulations and /$la6s o the CGRCG) o! the conduct o an/ +e+,e! has ,een dishono!a,le o! i+#!o#e! o! othe!6inBu!ious to the cha!acte! and inte!est o the CGRCG) and ,5 a !esolution is #assed ,/ the oa!d e>#elling the +e+conce!ned) 6ithout assigning an/ !eason the!eo!&

It is thus clea! that a +e+,e! 6ho co++its an/ o the causes o! e>#ulsion enu+e!ated in #a!ag!a#h o "!ticle VII +a/e>#elled ,/ the oa!d o Di!ecto!s) th!ough a !esolution) 6ithout gi*ing that e!!ing +e+,e! an/ notice #!io! to his e>#ulsThe !esolution need not e*en state the !eason o! such action&

The CGRCG /$la6 #!o*ision on e>#ulsion) as #h!ased) +a/ sound unusual and o,Bectiona,le to #etitione!s as the!e is

!e8ui!e+ent o #!io! notice to ,e gi*en to an e!!ing +e+,e! ,eo!e he can ,e e>#elled& ut that is ho6 #eculia! the nato a !eligious co!#o!ation is )is-=-)isan o!dina!/ co!#o!ation o!gani=ed o! #!oit& It +ust ,e st!essed that the ,asis o !elationshi# ,et6een a !eligious co!#o!ation and its +e+,e!s is the latte!?s a,solute adhe!ence to a commreligiouso! spiritual belief& Once this ,asis ceases) +e+,e!shi# in the !eligious co!#o!ation +ust also cease& Thus) gene!athe!e is no !oo+ o! dissension in a !eligious co!#o!ation& "nd 6he!e) as he!e) an/ +e+,e! o a !eligious co!#o!atioe>#elled !o+ the +e+,e!shi# o! es#ousing doct!ines and teachings cont!a!/ to that o his chu!ch) the esta,lished doctin this Bu!isdiction is that such action !o+ the chu!ch autho!ities is conclusi*e u#on the ci*il cou!ts& "s a! ,ac; in 1(1)held in nited States )s. #anete


16/28

4o!eo*e!) the #etitione!s !eall/ ha*e no !eason to ,e6ail the lac; o #!io! notice in the /$la6s& "s co!!ectl/ o,se!*ed ,/ Cou!t o "##eals) the/ ha*e *ai)edsuch notice ,/ adhe!ing to those /$la6s& The/ ,eca+e +e+,e!s o CGRCG )oluntarily. $hey entered into its co)enant and subscribed to its rules. &y doing so, they are bound by thconsent&-

7*en assu+ing that #etitione!sQ e>#ulsion alls 6ithin the Constitutional #!o*isions on #!io! notice o! due #!ocess) stillcan not conclude that !es#ondents co++itted a constitutional in!action& It ,ea!s e+#hasis that #etitione!s 6e!e gi*en +than suicient notice o thei! i+#ending e>#ulsion) as sho6n ,/ the !eco!ds&

He ha*e na!!ated ea!lie! the e*ents 6hich led to the 8uestioned e>#ulsion& F!o+ the undisputed testi+on/ o Di!e"nthon/ Sa/heelia+ no6 !es#ondent5) it is clea! that) as early as 6788) the !es#ondents$oa!d o Di!ecto!s #atientl/ #e!sistentl/ !e+inded) ad*ised and e>ho!ted the e!!ing +e+,e!s) including he!ein #etitione!s) to sto# es#ousing doct!inteachings and !eligious ,elie dia+et!icall/ o##osed to the .!inci#les o Faith e+,!aced ,/ the CGRCG& The !es#ondenoa!d o Di!ecto!s u!the! 6a!ned the+ du!ing Sunda/ 6o!shi# gathe!ings) in s+all g!ou# +eetings and one$on$one tthat the/ 6ould ace disci#lina!/ action and ,e d!o##ed !o+ the +e+,e!shi# !oll should the/ continue to e>hi,it aini+ical and inBu!ious to the teachings o the Gol/ i,le 6hich the CGRCG so =ealousl/ u#holds&

Hhen the/ igno!ed #etitione!s? e>ho!tations and 6a!nings) the e!!ing +e+,e!s should not no6 co+#lain a,out te>#ulsion !o+ the +e+,e!shi# o the CGRCG ,/ the oa!d o Di!ecto!s on "ugust 30) (1(3&

The Cou!t o "##eals) 6hose indings o act is acco!ded g!eat !es#ect as the sa+e is conclusi*e on us) +ade a #!eco,se!*ation on this +atte!A

&the #etitione!s no6 !es#ondents5 u!the! state that the oa!d o Di!ecto!s) ,eo!e deciding to #u!ge thei! lis+e+,e!shi#) ga*e the e!!ing +e+,e!s suicient 6a!ning o thei! i+#ending ouste!& ThusA

K the !eco!ds o the instant case indis#uta,l/ sho6 that the e!!ing +e+,e!s o the co!#o!ation) includ!es#ondents no6 #etitione!s5 :i+ Che oon) Jose#h :i+) Tan Gon Joc) :iu e; See) Feli> "l+e!ia a"l!edo :ong) 6e!e gi*en +o!e than suicient notice that the #e!#et!ation o acts ini+ical to and inconsist6ith the "!ticles o Faith o the Co!#o!ation 6ill ,e su,Bect to disci#lina!/ autho!it/ o the oa!d o Di!ecto

Testi+on/ o "nthon/ Sa/heelia+) +e+,e! o the oa!d o Di!ecto!s5

& ou +entioned that o!+e! +e+,e!s o the Co!#o!ation 6e!e d!o##ed o! e>#elled due to *iolations o

#!inci#les o aith unde! the "!ticles o Inco!#o!ation and the /$la6s) as 6ell as o! conduct 6hich 6as dishono!ai+#!o#e! and inBu!ious to the cha!acte! and inte!est o the co!#o!ation& Hhen did the oa!d i!st note o! o,se

these *iolationsM

"& The oa!d noticed that since 1(&

& "s a +e+,e! o the oa!d o Di!ecto!s) 6hat actions did /ou ta;e ate! the ,oa!d o,se!*ed these *iolatio

"& He 6a!ned the+ and ad*ised the+ to co!!ect thei! 6a/s o doing these things&

& "s a +e+,e! o the oa!d o Di!ecto!s) 6hat did /ou sa/ o! do in o!de! to con*ince these o!+e! +e+,to co!!ect thei! 6a/sM

"& He told the+ that unde! the /$la6s this o!gani=ation is onl/ o! 6o!shi##ing the t!ue %od) not to 6o!s

uddha o! +en&

& ou also +entioned that /ou ga*e 6a!nings to these e!!ant +e+,e!s& "s a +e+,e! o the oa!dDi!ecto!s) 6hat did /ou do o! sa/ to 6a!n these o!+e! +e+,e!s o the conse8uences o thei! actsM

"& 7s#eciall/ to the +e+,e!s o the o!gani=ation) the/ should ta;e all the conse8uences& Othe!6ise) the/ ,e d!o##ed&

& These 6a!nings and state+ents ad*ising the+ to co!!ect thei! 6a/) on 6hat occasion 6e!e thstate+ents +adeM

"& In a gene!al se!*ice) Sunda/) and also in s+all g!ou# +eetings and e*en one$on$one) #e!sonall/ tal;6ith the+&


17/28

& Go6 oten 6e!e these 6a!nings o! ad*ise to co!!ect +adeM

"& So+eti+es once a 6ee; 6e +eet togethe!&

& Since 6henM

"& Since 1(& TSN) Dece+,e! 1) 1((3) .e!ea Case) ##& ($125&

$'o + o' &>3+ +o -3-5;-%a3+-o%.In !act, private respondents &no' petitioners( never speci!ica## denied or disputed testimon o! petitioner &no' respondent( Ant%on Sa%ee#iam , B+' o% + B-+% +a% o' -% a5;a-%< -% + P'a Ca o' -% + o+' 3a >+B% + 5a'+-, +a+ +y aF >% '5a+ao%- >y + >' o + /oa' o D-'3+o' +a+ + -%+'o&3+-o% o +a3-%; B-+ +-' 5&;-o% Rollo) %&R& S. No& 1y=;aB.* )%e respondents &no' petitioners( ma*e no protestation t%at CH+RCHs b#a' provision on e-pu#sion %as not been3o5;- B-+K.J 7+#hasis ou!s5

Conse8uentl/) the e>#ulsion 6as not tainted 6ith an/ a!,it!a!/ t!eat+ent !o+ the +e+,e!s o the oa!d o Di!ecto!s 6since 1( u# to "ugust 30) 1((3) o! approimately fi)e 3>4 years) ha*e #atientl/ e>ho!ted and 6a!ned the dissid+e+,e!s& This long #e!iod o ti+e is +o!e than ade8uate an o##o!tunit/ o! the e!!ing +e+,e!s and thei! ollo6e!sconte+#late u#on thei! co*enant 6ith the CGRCG on thei! dut/ to #!otect and #!o+ote its .!inci#les o Faith and no*iolate the+& It is a 6ell$settled #!inci#le in la6 that 6hat due #!ocess conte+#lates is !eedo+ !o+ a!,it!a!iness@ 6ha!e8ui!es is ai!ness and Bustice@ su,stance) !athe! than the o!+) ,eing #a!a+ount& Hhat it #!ohi,its is not the a,sence#!e*ious notice ,ut the a,solute a,sence the!eo&(" o!+al o! t!ial t/#e hea!ing is not at all ti+es and in all instanessentialulsion) +o!e than suicient notice 6as gi*en to the+ ,eo!e the/ 6e!e e>#elled ,/ the oa!d"ugust 30) 1((3&

.etitione!s) ho6e*e!) contend that the e>#elled +e+,e!s 6e!e not actuall/ notiied and 6a!ned o thei! i+#ende>#ulsion& In su##o!t o this) the/ also cited the ollo6ing testi+on/ o "nthon/ Sa/heelia+A

"TT& .":IT7A

& %id you go through the list one by oneM

"& Yes&

& So do /ou !e+e+,e! ho6 +an/ 6e!e e>#elled ,ecause o conduct dishono!a,le) i+#!o#e!) inBu!ious to co!#o!ationM

"& At the time6e did not count the nu+,e!& ?e "ust tal+ed it one by one, discussed

& O;e/) Did /ou noti/ the+ o the g!ounds o! thei! e>#ulsionM

"& No&

& ou did not& Did /ou gi*e the+ an o##o!tunit/ to deend the+sel*esM

"& No&


18/28

.etitione!s? inte!#!etation o the a,o*e$8uoted testi+on/ o "nthon/ Sa/heelia+ 6as out o conte>t& The 8uestion aans6e! focusedon 6hat the oa!d o Di!ecto!s did during its meeting on August 9@, 6779 *herein it e)aluated emember0s standing and conduct in the light of the grounds for disciplinary action as pro)ided in the #/R#/ &y-la*s & Th#lain !o+ the unde!sco!ed #o!tions o Sa/heelia+?s testi+on/& Thus) 6hat Sa/heelia+ 6as sa/ing is that on that )ery of the epulsion) the oa!d o Di!ecto!s did not noti/ the e>#elled +e+,e!s an/+o!e& O,*iousl/) such notice 6as not +,/ the oa!d o Di!ecto!s si+#l/ ,ecause the /$la6s o the CGRCG does not !e8ui!e the sa+e) as al!ead/ discussea!lie!&

Incidentall/) du!ing the #endenc/ o these cases in this Cou!t) #etitione!s iled an a##lication o! a TRO6!it o #!eli+ininBunction dated No*e+,e! 10) 1(() clai+ing the!ein that !es#ondents a!e den/ing the+ access to the #!e+ises o

CGRCG o! #u!#oses o e>e!cising thei! !ight o 6o!shi#& "cting on the a##lication) this Cou!t !e8ui!ed the !es#ondentsco++ent the!eon& In the +eanti+e) it issued a S#ecial O!de! on Dece+,e! 1) 1(( enBoining the !es#ondents !eno!cing the Cou!t o "##eals? decision insofar as petitioners0 rights and pri)ileges as members of the #/R#/ concerned& "cco!dingl/) #etitione!s 6e!e allo6ed ent!/ into the CGRCG ,uilding o 6o!shi# andparticipate in its religiand social acti)ities&

On Janua!/ 2() 1((() #etitione!s :i+ Che oon) Tan Gon Loc) Jose#h :i+ and :iu e; See iled a #etition to !es#ondents in conte+#t o! !eusing to co+#l/ 6ith the S#ecial O!de! o this Cou!t& This 6as doc;eted as %&R& No& 13-1.etitione!s a*e!!ed the!ein that !es#ondents denied the+ access to the 6o!shi# halls o! thei! s#ecial cone!ence in*ol*the s#i!itual t!aining o so+e 1) 00 college students !o+ Regions I to VI&

In thei! co++ent) !es#ondents o##osed the #etition) clai+ing that thei! !eusal to lend the 6o!shi# halls 6as due to the that the intended s#ecial cone!ence is not a !eligious se!*iceacti*it/ of the #/R#/and the #a!tici#ants a!e not memb

of the #/R#/& Thus) !es#ondents asse!t that the/ did not *iolate the S#ecial O!de! o this Cou!t&

He ag!ee 6ith the !es#ondents& The S#ecial O!de! allo6s #etitione!s ent!/ into the CGRCG ,uilding to participat6o!shi# o! othe! !eligious acti*ities as members of the #/R#/& Clea!l/) the S#ecial O!de! does not allo6 #etitionunli+ited o! un!est!ained access o! use o the #!e+ises and #!o#e!ties o the CGRCG& The intended s#ecial cone!ence,e conducted ,/ #etitione!s is nota CGRCG acti*it/ and the #a!tici#ants the!ein a!e not memberso the CGRCG&

HG7R7FOR7) the #!esent consolidated #etitions a!e D7NI7D& The assailed decision o the Cou!t o "##eals dated 4a/ 1(( and its !esolution dated "ugust 1) 1(( a!e "FFIR47D& Costs against #etitione!s&

The S#ecial O!de! dated Dece+,e! 1) 1(( issued ,/ this Cou!t is :IFT7D&

SO ORD7R7D&

'itug, and Panganiban, .,conMelo, .,#lease see dissenting o#inion&

DISSENTING OPINION

ME)O,J.!

Custo+a!il/ and gene!all/) the ci*il cou!ts 6ould not inte!e!e in +atte!s in*ol*ing dis#utes 6ithin a !eligious co!#o!atnot onl/ ,ecause the 8uestion +a/ ,e essentiall/ ecclesiatical in natu!e ,ut +o!e i+#o!tantl/ ,ecause o the unda+e#!inci#le o se#a!ation chu!ch and State #!o*ided in ou! Constitution& This gene!al !ule) ho6e*e!) is ad+ittedl/ su,Bec

ce!tain e>ce#tions) and I su,+it that the instant case is one such instance&

In Romero )s. %e los Reyes1 .hil& 11< [1('


19/28

&&& the cou!ts 6ill not inte!e!e 6ith the inte!nal aai!s o an uninco!#o!ated association so as to settle dis#u,et6een the +e+,e!s o! 8uestions o #olic/) disci#line o! inte!nal go*e!n+ent) so long as the go)ernment of society is fairly and honestly administered in conformity *ith its la*s and the la*s of the land, and no propertyci)il rights are in)aded& nde! such ci!cu+stances) the decision o the association is ,inding and conclusi*e annot su,Bect to !e*ie6 o! collate!al attac;s in the cou!ts&

The gene!al !ule o non$inte!e!ence in the inte!nal aai!s o associations is) ho6e*e!) su,Bect to e>ce#tions) ,ut #o6e! o !e*ie6 is e>t!e+el/ li+ited& "cco!dingl/) the courts ha)e and *ill eercise the po*er to interfere in internal affairs of an association *here la* and "ustice so re!uire, and the proceedings of the association are sub"to "udicial re)ie* *here there is fraud, oppression, or bad faith, or *here the action complained of is capricio

arbitrary, or un"ustly discriminatory& "lso) the cou!ts 6ill usuall/ ente!tain Bu!isdiction to g!ant !elie in case propeor ci)il rights are in)aded) although it has also ,een held that the in*ol*e+ent o #!o#e!t/ !ights does necessa!il/ autho!i=e Budicial inte!*ention) in the a,sence o a!,it!a!iness) !aud o! collusion& 4o!eo*e!) the co6ill inte!*ene 6he!e the proceedings in !uestion are )iolati)e of the la*s of the society, or the la* of the land,by deprivin$ a person o! due process o! #a'& Si+ila!l/) Budicial inte!*ention is 6a!!anted 6he!e the!e is lac+"urisdiction on the part of the tribunal conducting the proceedings, *here the organization eceeds its po*ers,*here the proceedings are other*ise illegal&

Hhat is in issue in the #!esent consolidated #etitions is 6hethe! o! not the e>#ulsion o so+e o the +e+,e!s o the !eligico++unit/ called The Chu!ch in ue=on Cit/ CC5) cont!a*ene the la6s o the land o! a!e *iolati*e o the ci*il !ightsthe +e+,e!s the!eo&

I *ote in the ai!+ati*e&

"s clea!l/ stated in ions #lub (nternational) the gene!al !ule o non$inte!e!ence ad+its o ce!tain e>ce#tionA The ci*il coucan !e*ie6 #!oceedings unde!ta;en ,/ !eligious o!gani=ations and +a/ inte!e!e) so to s#ea;) 6ith the inte!nal aathe!eo) as la6 and Bustice so !e8ui!e) 6hen the acts co+#lained o cont!a*ene the ,asic la6 o the land and *iolate the c!ights o its +e+,e!s& 4o!e s#eciicall/) 6he!e the!e is !aud) o##!ession) o! ,ad aith) and 6he!e the action o the leado the o!gani=ation is ca#!icious) a!,it!a!/) and unBustl/ disc!i+inato!/) the ci*il cou!ts +a/ e>e!cise Budicial #o6e!& cou!ts 6ill li;e6ise e>e!cise Bu!isdiction to g!ant !elie in case #!o#e!t/ o! ci*il !ights a!e in*aded) although it has also ,held that in*ol*e+ent o #!o#e!t/ !ights does not necessa!il/ autho!i=e Budicial inte!*ention) in the a,sence o a!,it!a!ine!aud) and collusion& "nothe! s#eciic instance 6hen inte!*ention ,/ the cou!ts ,eco+es 6a!!anted is 6hen the #!oceediin 8uestion a!e *iolati*e o eithe! the ,/$la6s o the societ/ itsel o! the ,asic la6 o the land) such as 6hen the!e i*iolation o the unda+ental !ight to due #!ocess o la6& Si+ila!l/) Budicial inte!*ention is 6a!!anted 6he!e the!e is lac;Bu!isdiction on the #a!t o the t!i,unal conducting the #!oceedings) 6he!e the o!gani=ation e>ceeds its #o6e!s) o! 6he!e #!oceedings a!e othe!6ise illegal&

The actual antecedents o the #!esent case ,!ing it s8ua!el/ 6ithin the e>ce#tion to the gene!al !ule o non$inte!e!encenon$inte!*ention& It +ust ,e unde!sco!ed that the issue does not +e!el/ in*ol*e the !ight to use the #!o#e!t/ o CC in #!esent case) ,ut +o!e i+#o!tantl/ that the e>#ulsion !o+ CC does constitute a se!ious e+otional de#!i*ation on the #o each o #etitione!s 6hich) 6hen co+#a!ed to losses o #!o#e!t/ o! cont!actual !ights) can ,e a! +o!e da+aging #!eBudicial& Fu!the!) the loss o the o##o!tunit/ to 6o!shi# in a+ilia! su!!oundings is a *alua,le !ight) 6hich dese!*es #!otection o the la6 6he!e no constitutional ,a!!ie! e>ists &augh ). $homas) 2'< "& 2d '-change Co++ission S7C5 e!!ed in !e$o#ening the case 6hich had #!e*iousl/ ,eco+e inal and e>ecutoThe Perea casehad indeed ,eco+e inal and e>ecuto!/ ,ut it #e!tained onl/ to the #!eli+ina!/ !e+ed/ sought#etitione!s& "s co!!ectl/ #ointed out in the +aBo!it/ o#inion) the hea!ing #anel conducted u!the! #!oceedings to decide #e!+issi*e counte!clai+ and thi!d$#a!t/ co+#laint inco!#o!ated in !es#ondents? su##le+ental ans6e!) including thei! #!ao! inBuncti*e !elie to #!e*ent #etitione!s !o+ inte!e!ing and usu!#ing unctions o the oa!d o Di!ecto!s& .etitione!s

+otions to dis+issst!i;e out the counte!clai+ and thi!d$#a!t/ co+#laint& These +otions 6e!e denied ,/ the hea!ing #ain an O+ni,us O!de! date Octo,e! 2) 1((


20/28

& I it is ,!ought to the notice o the oa!d o Di!ecto!s that an/ +e+,e! has ailed to o,se!*e an/ !egulations a/$:a6s o the Institution o! the conduct o an/ +e+,e! has ,een dishono!a,le o! i+#!o#e! o! othe!6ise inBu!i

to the cha!acte! and inte!est o the Institution) the oa!d o Di!ecto!s +a/ ,/ !esolution) 6ithout assigning a!eason the!eo!e) e>#el such +e+,e! !o+ the Institution and he shall then o!eit his inte!est) !ights and #!i*ilein the Institution&

This #a!ticula! #!o*ision 6as e>#lained ,/ the inco!#o!ato!s du!ing the hea!ing on the !egist!ation o CC 6ith the S7C)intended to gi*e the +e+,e! a chance to e>#lainA

& 4a/ 6e ;no6 !o+ 6hat a!e the disci#line i+#osed ,/ the #!o#osed chu!ch to the +e+,e!s) i an/M

4R& ON%A

"& He ha*e he!e the Rules and Regulations o the CGRCG IN 7PON CIT CGRCG "SS74: G"::5) IN6hich o! #u!#oses o identiication 6e !e8uest that the sa+e ,e +a!;ed as 7>hi,it C) consisting o 2 #ages) da4a/ 2) 1(-3&

"TT& T"NIN%COA

:et the docu+ent +entioned ,e +a!;ed acco!dingl/&

& No6) on the second #age o this Rules and Regulations that is #!e*iousl/ +a!;ed 7>hi,it C) the!e a##e

a,o*e the t/#e6!itten na+e :/dia :ao a signatu!e& Hill /ou #lease ta;e a loo; at this signatu!e and tell us 6hsignatu!e is thisM

4ISS :"OA

"& This is +/ signatu!e) /ou! hono!&

& "lso) in the second #age o this Rules and Regulations) the!e a##ea!s as one o the #!o*isions) enti.unish+ent) 6ill /ou #lease e>#lain to this Co++ission the +eaning o thisM It sa/s that an/ +e+,e! ound toini+ical to o! unaithul to the teaching o! doct!ines o the ,!othe!hood o the Chu!ch in ue=on Cit/ Chu"sse+,l/ Gall5) Inc&) 6ill ,e !e+o*ed !o+ +e+,e!shi#&

"& "n/ +e+,e! 6ho acts o! ,elie*es cont!a!/ to ou! doct!ine stated in the ,i,le o! the aith that 6e

adhe!ing) then he 6ill ,e !e8uested to lea*e&

& Hho decides that a +e+,e! should ,e !e8uested to lea*e 6hen ound guilt/M

"& Ou! !es#onsi,le ,!othe!s and siste!s&

& Is he not gi*en a chance to e>#lain his actsM

"& Ge is gi*en a chance to e>#lain&

It 6as indeed !e*e!si,le e!!o! o! the Cou!t o "##eals to igno!e the clea! intent o the CC that its +e+,e!s ,e acco!due #!ocess o la6 ,/ gi*ing the+ a chance to e>#lain #!io! to e>#ulsion&

O cou!se) !es#ondents insist that #etitione!s 6e!e in act acco!ded due #!ocess des#ite the act that it 6as not necessunde! thei! /$:a6s& The !eco!d) ho6e*e!) sho6s othe!6ise& Du!ing the hea!ing conducted on No*e+,e! 1


21/28

"& es&

& So do /ou !e+e+,e! ho6 +an/ 6e!e e>#elled ,ecause o conduct dishono!a,le) i+#!o#e!) inBu!ious to co!#o!ationM

"& "t the ti+e 6e did not count the nu+,e!& He Bust tal;ed it one ,/ one) discussed&&&

& O;e/) Did /ou! noti/ the+ o the g!ounds o! thei! e>#ulsionM

"& No&

& ou did not& Did /ou gi*e the+ an o##o!tunit/ to deend the+sel*esM

"& No&

The #!ocedu!al !e8ui!e+ent s#elled out in thei! /$:a6s 6as e*identl/ not +et at all&

I) the!eo!e) ag!ee 6ith the S7C 6hen it !uled that a +e+,e! could ,e e>#elled onl/ ate! notice and hea!ing& .etitionco!!ectl/ asse!t that the Cou!t o "##eals e!!ed in holding that no #!io! notice o! hea!ing is !e8ui!ed as the /$:a6s 6silent on the +atte!& It has ,een held that the !ight to ,e ad*ised in ad*ance o the cha!ges is a unda+ental !ight to 6hthe +e+,e! is entitled e*en 6ithout a ,/$la6 #!o*ision& 2amentra, (nc. ). American Society of $ra)el Agents, (nc) 2 42d 2(1) 211 N S2d 'clusion o #etitione!s ,eing null and *oid) thei! standing as bona fide+e+,e!s o the CC continues& Ththe election a+ong the +aBo!it/ o the +e+,e!s o the CC) including #etitione!s he!ein 6ho a!e dee+ed not to ha*e ,e>cluded the!e!o+) conducted on June 20) 1(( 6as in acco!dance 6ith the /$:a6s and should ,e conside!ed *atogethe! 6ith all othe! acts e+anating the!e!o+& The list o +e+,e!s indicated in the Chu!ch?s 4e+,e!shi# oo; "nne>in %&R& No& 13('3$'5 should ,e the co+#lete list o the +e+,e!shi# o the CC&

It is un!e,utted that !es#ondents? g!ou# co+#!ises +e!el/ the +ino!it/ in the CC& The +eeting called ,/ #!i*!es#ondents on Fe,!ua!/ 12) 1((cluded #etitione!s? g!ou#) 6as not *alid conside!ing that it 6as called ,#e!son 6ho is not a +e+,e! o the CC o! a di!ecto! the!eo& The acts then o !es#ondents as a !esult o thei! +eeting


22/28

*oid as the/ 6e!e conducted 6ithout notice to o! in the a,sence o the othe! +e+,e!s o the CC& The +e+,e!s o oa!d) dul/ elected ,/ the +aBo!it/ as dete!+ined !o+ the 4e+,e!shi# oo; a!e dee+ed *alid&

Finall/) the cha!ges ,et6een the #a!ties that the othe! has di*e!ted !o+ the aith and #!inci#les o thei! o!gani=ation #u!el/ ecclesiastical +atte!s and the Cou!t should !e!ain !o+ !uling the!eon& It +a/ ,e noted) ho6e*e!) that iundis#uted that the CC 6as ounded ,/ Hitness :ee& It is thus a +atte! to ,e !esol*ed ,/ the +e+,e!s o the institut6hethe! those 6ho continue to loo; at Hitness :ee should ,e dee+ed to ha*e di*e!ted !o+ thei! aith as clai+ed!es#ondents5) o! it is !es#ondents 6ho ha*e di*e!ted thei! aith ,/ thei! denial o the !ole o Hitness :ee in the CC clai+ed ,/ #etitione!s5&

nde! the o!egoing #!e+ises) I) the!eo!e) !egiste! +/ dissent and *ote to g!ant the #etition o! ce!tio!a!i& The decisionthe Cou!t o "##eals dated 4a/ 2() 1(( in C&"& %&R& S. No& 31


23/28

Ve!iication and Ce!tiication o Non$Fo!u+ Sho##ing 6e!e signed ,/ onl/ one o the+ $$ "tt/& Sa,ino .adilla J!& The secResolution denied !econside!ation&

T $a3+

.etitione! %!ace Ch!istian Gigh School %CGS5 is a nonstoc;) non$#!oit educational co!#o!ation 6ith iteen !egula! +e+,e!s) 6ho also constitute the ,oa!d o t!ustees&[] Du!ing the annual +e+,e!s? +eeting held on "#!il ') 1(the!e 6e!e onl/ ele*en 115[#lained that the 8uali/ing #h!ase entitled to *oteSection 2[(]o the Co!#o!ation Code) 6hich #!o*ided the ,asis o! dete!+ining a 8uo!u+ o! the election o di!ecto!st!ustees) should ,e !ead togethe! 6ith Section (&[10]

The hea!ing oice! also o#ined that "!ticle III 25 [11]o the /$:a6s o %CGS) insoa! as it #!esc!i,ed the +odeilling *acancies in the ,oa!d o t!ustees) +ust ,e inte!#!eted in conBunction 6ith Section 2([12]o the Co!#o!ation Code& S7C en ,anc denied the a##eal o #etitione!s and ai!+ed the Decision o the hea!ing oice! in toto& [13] It ound to

untena,le thei! contention that the 6o!d +e+,e!s) as used in Section


24/28

T Co&'+* R&;-%t 8uestion to !esol*e is 6hat ha##ens in the e*ent o the death o one o the+&

In stoc; co!#o!ations) sha!eholde!s +a/ gene!all/ t!anse! thei! sha!es& Thus) on the death o a sha!eholde!) e>ecuto! o! ad+inist!ato! dul/ a##ointed ,/ the Cou!t is *ested 6ith the legal title to the stoc; and entitled to *ote it&

a settle+ent and di*ision o the estate is eected) the stoc;s o the decedent a!e held ,/ the ad+inist!ato! o! e>ecuto!&[

On the othe! hand) +e+,e!shi# in and all !ights a!ising !o+ a nonstoc; co!#o!ation a!e #e!sonal and nt!anse!a,le) unless the a!ticles o inco!#o!ation o! the ,/la6s o the co!#o!ation #!o*ide othe!6ise& [e!cise thei! *oting !ights th!ough thei! e>ecuto!ad+inist!ato!5) de#ends on those a!ticles o inco!#o!ation o! ,/la6s&

nde! the /$:a6s o %CGS) +e+,e!shi# in the co!#o!ation shall) a+ong othe!s) ,e te!+inated ,/ the death o +e+,e!&['] Section (1 o the Co!#o!ation Code u!the! #!o*ides that te!+ination e>tinguishes all the !ights o a +e+,ethe co!#o!ation) unless othe!6ise #!o*ided in the a!ticles o inco!#o!ation o! the ,/la6s&

"##l/ing Section (1 to the #!esent case) 6e hold that dead +e+,e!s 6ho a!e d!o##ed !o+ the +e+,e!shi# !ostethe +anne! and o! the cause #!o*ided o! in the /$:a6s o %CGS a!e not to ,e counted in dete!+ining the !e8uisite *otco!#o!ate +atte!s o! the !e8uisite 8uo!u+ o! the annual +e+,e!s? +eeting& Hith 11 !e+aining +e+,e!s) the 8uo!u+

the #!esent case should ,e '& The!eo!e) the!e ,eing a 8uo!u+) the annual +e+,e!s? +eeting) conducted 6si>[-]+e+,e!s #!esent) 6as *alid&

acanc in t%e0oard o! )rustees

"s !ega!ds the illing o *acancies in the ,oa!d o t!ustees) Section 2( o the Co!#o!ation Code #!o*idesA

S7CTION 2(& 'acancies in the office of director or trustee& $$ "n/ *acanc/ occu!!ing in the ,oa!d odi!ecto!s o! t!ustees othe! than ,/ !e+o*al ,/ the stoc;holde!s o! +e+,e!s o! ,/ e>#i!ation o te!+) +a/,e illed ,/ the *ote o at least a +aBo!it/ o the !e+aining di!ecto!s o! t!ustees) i still constitutinga !uorum@ othe!6ise) said *acancies +ust ,e illed ,/ the stoc;holde!s in a !egula! o! s#ecial +eeting calledo! that #u!#ose& " di!ecto! o! t!ustee so elected to ill a *acanc/ shall ,e elected onl/ o! the une>#i!ed

te!+ o his #!edecesso! in oice&

ndou,tedl/) t!ustees +a/ ill *acancies in the ,oa!d) #!o*ided that those !e+aining still constitute a 8uo!u+& #h!ase +a/ ,e illed in Section 2( sho6s that the illing o *acancies in the ,oa!d ,/ the !e+aining di!ecto!s o! t!ustconstituting a 8uo!u+ is +e!el/ #e!+issi*e) not +andato!/& []Co!#o!ations) the!eo!e) +a/ choose ho6 *acancies in t!es#ecti*e ,oa!ds +a/ ,e illed u# $$ eithe! ,/ the !e+aining di!ecto!s constituting a 8uo!u+) o! ,/ the stoc;holde!s+e+,e!s in a !egula! o! s#ecial +eeting called o! the #u!#ose&[(]

The /$:a6s o %CGS #!esc!i,ed the specific+ode o illing u# e>isting *acancies in its ,oa!d o di!ecto!s@ that isa +aBo!it/ *ote o the !e+aining +e+,e!s o the ,oa!d&[


28/28

Hhile a +aBo!it/ o the !e+aining co!#o!ate +e+,e!s 6e!e #!esent) ho6e*e!) the election o the ou! t!ust

cannot ,e legall/ u#held o! the o,*ious !eason that it 6as held in an annual +eeting o the +e+,e!s) not o the ,oa!dt!ustees& He a!e not un+indul o the act that the +e+,e!s o %CGS the+sel*es also constitute the t!ustees) ,ut cannot igno!e the %CGS ,/la6 #!o*ision) 6hich s#eciicall/ #!esc!i,es that *acancies in the ,oa!d +ust ,e illed u# ,/ !e+aining t!ustees& In othe! 6o!ds) these !e+aining +e+,e!$t!ustees must sit as a board in o!de! to *alidl/ elect the nones&

Indeed) the!e is a 6ell$deined distinction ,et6een a co!#o!ate act to ,e done ,/ the ,oa!d and that ,/ constituent +e+,e!s o the co!#o!ation& The ,oa!d o t!ustees +ust act) not indi*iduall/ o! se#a!atel/) ,ut as a ,od/

a6ul +eeting& On the othe! hand) in thei! annual +eeting) the +e+,e!s +a/ ,e !e#!esented ,/ thei! !es#ecti*e #!o>as in the contested annual +e+,e!s? +eeting o %CGS&

HG7R7FOR7) the .etition is #a!tl/ GRAN)2"&The assailed Resolutions o the Cou!t o "##eals he!e,/ R22RS2" AN" S2) ASI"2. The !e+aining +e+,e!s o the ,oa!d o t!ustees o %!ace Ch!istian Gigh Sch%CGS5 +a/ con*ene and ill u# the *acancies in the ,oa!d) in acco!dance 6ith this Decision& No #!onounce+ent as to coin this instance&

SO ORD7R7D&

Documents

Cases Corpo Sec 86-95 (Non-stock)