MR HOLDINGS vs. SHERIFF BAJAR & JANDUSAY, SOLIDBANK AND MARCOPPER [2002]

Facts

ADB extended to Marcopper a US$40M loan for its mining project at Marinduque 

·          ADB and Placer Dome, Inc., a FC which owns 40% of Marcopper, executed a Support and Standby Credit Agreement whereby the latter agreed to provide Marcopper with cash flow support.

·          Marcopper executed in favor of ADB a Deed of Real Estate and Chattel Mortgage covering substantially all of its properties and assets in Marinduque.  

·          When Marcopper defaulted, Placer Dome agreed to have its subsidiary Corp., MR Holding, Ltd., assumed Marcoppers obligation to ADB for US$ 18,453,450.02. 

·          In an Assignment Agreement ADB assigned to MR Holdings all its rights under the loan agreements, (Deed of Real Estate and Chattel Mortgage, and Support and Standby Credit Agreement). 

·          On Dec 8, 1997, Marcopper likewise executed a Deed of Assignment in favor of petitioner. 

Solidbank obtained a Partial Judgment against Marcopper from the RTC Manila

·          RTC of Manila issued a writ of execution pending appeal to require Marcopper to pay the sums of money to satisfy the Partial Judgment covering P52M + 10% AFS.

·          The Sheriff issued two notices of levy on Marcoppers personal and real properties. Together with sheriff  Jandusay of the RTC, Branch 94, Boac, Marinduque, Bajar issued two notices setting the public auction sale of the levied properties on Aug 27, 1998 at the Marcopper mine site.

affidavit of 3^rd-party claim at rtc-manila + complaint for reivindication  at rtc-boac marinduque

·          MR Holdings served an Affidavit of Third-Party Claim upon the sheriffs.

·          Upon the denial of its Affidavit of ThirdParty Claim by the RTC of Manila, petitioner commenced with the RTC of Boac, Marinduque, presided by Judge Ansaldo, a complaint for reivindication + PI + TRO.

·          WPI was denied OTG that 

a.     petitioner has no legal capacity to sue, it being a FC doing business in the PH 

b.     an injunction will amount to staying the execution of a final judgment by a court of co-equal and concurrent jurisdiction

c.     the validity of the Assignment Agreement and the Deed of Assignment has been put into serious question by the timing of their execution and registration.

MR holdings filed a Petition for Certiorari, Prohibition and Mandamus

·          CA held that RTC did not commit GAD in denying petitioners prayer for a WPI

·          Petitioner is not suing on an isolated transaction as it claims to be, as it is very obvious from the deed of assignment that its intention is to continue the operations of Marcopper  

·          There is no other way for petitioner to recover its huge financial investments which it poured into Marcoppers rehabilitation without petitioner continuing to do business in the country.

·          Even a single act may constitute doing business if it is intended to be the beginning of a series of transactions (Far East International Import and Export Corp. vs. Nankai Kogyo Co).

·          The Deeds of Assignment were made in fraud of creditors. The first Assignment Agreement purportedly executed on March 20, 1997 was entered into after Solidbank had filed on September 19, 1996 a case against Marcopper. The second Deed of Assignment purportedly executed on Dec 28, 1997 was entered into by President Gabor after Solidbank had filed its Motion for Partial SJ.

·          While the assignments may be valid between the parties thereof, it produces no effect as against third parties.  

petitioner’s arguments

·          It is not doing business in the PH and characterizes its participation in the assignment contracts as mere isolated acts that cannot foreclose its right to sue in local courts.

·          The 2 assignment contracts are not fraudulent conveyances as they were supported by valuable considerations. 

·          They were executed in connection with prior transactions that took place as early as 1992 which involved ADB, a reputable financial institution. 

Issue 1. Does petitioner have the legal capacity to sue? 

·          Right of a FC to sue

a.        if a FC does business in the PH without a license, it cannot sue before the Philippine courts;

b.        if a FC is not doing business in the PH, it needs no license to sue before Philippine courts on an isolated transaction or on a COA entirely independent of any business transaction;

c.        if a FC does business in the PH with the required license, it can sue before Philippine courts on any transaction. 

·          The question WON a FC is doing business is dependent principally upon the facts and circumstances of each particular case.

·          Corp. Code is silent as to what constitutes doing or transacting business in the PH. 

·          Case law definition: Mentholatum vs. Mangaliman: The true test, however, seems to be whether the FC is continuing the body or substance of the business or enterprise for which it was organized or whether it has substantially retired from it and turned it over to another. 

·          The case law definition was adopted in Foreign Investment Act of 1991 and Sec 1 of RA No. 5455.

The expression doing business should not be given such a strict and literal construction as to make it apply to any corporate dealing whatever.

·          CA categorized as doing business petitioners participation under the Assignment Agreement and the Deed of Assignment. This is simply untenable. 

·          The purpose  for which petitioner was organized is not discernible in the records. No effort was exerted by the CA to establish the nexus between petitioners business and the acts supposed to constitute doing business.

·          Thus, whether the assignment contracts were incidental to petitioners business or were continuation thereof is beyond determination. 

·          In Far East a single act may still constitute doing business if it is not merely incidental or casual, but is of such character as distinctly to indicate a purpose on the part of the FC to do other business in the state. In said case, there was an express admission from an official of the FC that he was sent to the PH to look into the operation of mines. 

·          Mere ownership by a FC of a property in a certain state, unaccompanied by its active use in furtherance of the business for which it was formed, is insufficient in itself to constitute doing business.

·          MR was engaged only in isolated acts or transactions. Single or isolated acts, contracts, or transactions of FCs are not regarded as a doing or carrying on of business. 

Issue 2. Was the Deed of Assignment between Marcopper and petitioner executed in fraud of creditors? 

·          The Support Credit Agreement was executed 4 years prior to Marcoppers insovency, hence, the alleged intention of petitioner to continue Marcoppers business could have no basis for at that time, Marcoppers fate cannot yet be determined.

Art. 1387. All contracts by virtue of which the debtor alienates property by gratuitous title are presumed to have been entered into in fraud of creditors, when the donor did not reserve sufficient property to pay all debts contracted before the donation.

Alienations by onerous title are also presumed fraudulent when made by persons against whom some judgment has been rendered in any instance or some writ of attachment has been issued.…

·          But this presumption of fraud may be rebutted by satisfactory evidence. All that is necessary is to establish affirmatively that the conveyance is made in good faith and for a sufficient and valuable consideration.

·          It is incredible for petitioner to be paying the huge sum of US $18M only for the purpose of defrauding Solidbank of the sum of P53M.

·          We cannot see how Solidbanks right was prejudiced considering that substantially all of Marcoppers properties were already covered by REM and CM as early as Nov 11, 1992. 

Issue 3. Are MR Holdings, Ltd., Placer Dome, and Marcopper one and the same entity? no. 

·          The mere fact that a Corp. owns all of the stocks of another Corp., taken alone is not sufficient to justify their being treated as one entity. If used to perform legitimate functions, a subsidiarys separate existence shall be respected, and the liability of the parent Corp. as well as the subsidiary will be confined to those arising in their respective business.

·          PNB vs. Ritratto Group Inc.,: circumstances which are useful in the determination of whether a subsidiary is but a mere instrumentality of the parent-Corp., to wit:

a.        The parent Corp. owns all or most of the capital stock of the subsidiary.

b.        The parent and subsidiary Corp.s have common directors or officers.

c.        The parent Corp. finances the subsidiary.

d.        The parent Corp. subscribes to all the capital stock of the subsidiary or otherwise causes its incorp..

e.        The subsidiary has grossly inadequate capital.

f.         The parent Corp. pays the salaries and other expenses or losses of the subsidiary.

g.        The subsidiary has substantially no business except with the parent Corp. or no assets except those conveyed to or by the parent Corp..

h.        In the papers of the parent Corp. or in the statements of its officers, the subsidiary is described as a department or division of the parent Corp., or its business or financial responsibility is referred to as the parent Corp.s own.

i.          The parent Corp. uses the property of the subsidiary as its own.

j.         The directors or executives of the subsidiary do not act independently in the interest of the subsidiary, but take their orders from the parent Corp..

k.        The formal legal requirements of the subsidiary are not observed.

·          What is only extant in the records is the matter of stock ownership. There are no other factors indicative that petitioner is a mere instrumentality of Marcopper or Placer Dome.

·          The mere fact that Placer Dome agreed to provide Marcopper with cash flow support in paying its obligations to ADB, does not mean that its personality has merged with that of Marcopper. 

·          This singular undertaking, performed by Placer Dome with its own stockholders in Canada and elsewhere, is not a sufficient ground to merge its corporate personality with Marcopper which has its own set of shareholders, dominated mostly by Filipino  

issue 4. Is petitioner guilty of forum shopping? no.

·          There could have been a violation of the rules thereon if MR and Marcopper were indeed one and the same entity. But since petitioner has a separate personality, it has the right to pursue its third-party claim by filing the independent reivindicatory action with the RTC of Boac, Marinduque, [R 39.16]

·          This reivindicatory action has for its object the recovery of ownership or possession of the property seized by the sheriff, despite the third party claim, as well as damages resulting therefrom, and it may be brought against the sheriff and such other parties as may be alleged to have connived with him in the supposedly wrongful execution proceedings, such as the judgment creditor himself. Such action is an entirely separate and distinct action from that in which execution has been issued. 

issue 5. won mr holdings is entitled to a wpi. yes.

·          A preliminary injunction may be granted when it is established:

a.     That the applicant is entitled to the relief demanded, and the whole or part of such relief consists in restraining the commission or continuance of the act or acts complained of, or in requiring the performance of an act or acts, either for a limited period or perpetually;

b.     That the commission, continuance or non-performance of the acts or acts complained of during the litigation would probably work injustice to the applicant; or

c.     That a party, court, agency or a person is doing, threatening, or is attempting to do, or is procuring or suffering to be done, some act or acts probably in violation of the rights of the applicant respecting the subject of the action or proceeding, and tending to render the judgment ineffectual.

·          An injunction is a proper remedy to prevent a sheriff from selling the property of one person for the purpose of paying the debts of another; and that while the general rule is that no court has authority to interfere by injunction with the judgments or decrees of another court of equal or concurrent or coordinate jurisdiction, however, it is not so when a third-party claimant is involved.

·          Herald Publishing Company: If that be so and it is so because the property, being that of a stranger, is not subject to levy then an interlocutory order such as injunction, upon a claim and prima facie showing of ownership by the claimant, cannot be considered as such interference either.

dispositive

·          Upon filing of a bond of P1M, sheriffs are restrained from further implementing the writ of execution by the RTC Manila. The RTC Boac, Marinduque, is directed to dispose of CC No. 98-13 with dispatch.

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PEOPLE vs. BOKINGO and COL [2011]

doctrine

·          GR: The rights of a party cannot be prejudiced by an act, declaration or omission of another. 

·          E: admission made by a conspirator, but:

o    the conspiracy be first proved by evidence other than the admission itself;

o    admission relates to the common object;

o    it has been made while the declarant was engaged in carrying out the conspiracy.

facts

·          An Info was filed against Bokingko and Col charging them of murdering Pasion with a claw hammer.

·          Bokingco entered a guilty plea while Col pleaded not guilty. During the pre-trial, Bokingco confessed to the crime charged.

·          The victim, Noli Pasion and his wife, Peaches, were residing in a house in Angeles City. Pasion owned a pawnshop, which formed part of his house. He also maintained 2 rows of apartment units at the back of his house. Appellants, who were staying in Apartment No. 3, were among the 13 construction workers employed by Pasion.

prosecution’s evidence

·          Vitalicio

o    He was a resident in the apartment. He was spin-drying his clothes when Pasion came from the front door, passed by him and went out of the back door.

o    A few minutes later, he heard a commotion from Apartment No. 3. He peeped through a screen door and saw Bokingco hitting something on the floor. Upon seeing Vitalicio, Bokingco allegedly pushed open the screen door and attacked him with a hammer in his hand. Vitalicio bit Bokingco’s neck and managed to push him away.

o    Bokingco tried to chase Vitalicio but was eventually subdued by a co-worker. Vitalicio proceeded to his house and was told by his wife that Pasion was found dead in the kitchen. Vitalicio went back to Apartment No. 3 and saw Pasion’s body lying flat on the kitchen floor.

·          Peaches (wife of the victim)

o    testified that she was in the master’s bedroom on the second floor of the house when she heard banging sounds and her husband’s moans.

o    Before reaching the kitchen, Col blocked her way. Peaches asked him why he was inside their house but Col suddenly ran towards her, sprayed tear gas on her eyes and poked a sharp object under her chin.

o    Peaches was wounded when she bowed her head to avoid the tear gas. Col instructed her to open the vault of the pawnshop but Peaches informed him that she does not know the combination lock.

o    Peaches tried offering him money but Col dragged her towards the back door by holding her neck and pulling her backward. Before they reached the door, Peaches saw Bokingco open the screen door and heard him tell Col: "tara, patay na siya."

o    Col immediately let her go and ran away with Bokingco. Peaches proceeded to Apartment No. 3. Thereat, she saw her husband lying on the floor, bathed in his own blood.

·          PO3 Dayrit:

o    he received a phone call regarding the incident.

o    He saw a claw hammer with a green lead pipe handle approximately 13 inches long near the kitchen sink. A lead pipe measuring 40 inches and a chisel were also found in the nearby construction site.

·          Evelyn Gan, the stenographic reporter of Prosecutor Dayaon, during the preliminary investigation. She attests that Bokingco admitted that he conspired with Col to kill Pasion and that they planned the killing several days before because they got "fed up" with Pasion.

·          Dr. Esguerra concluded that the injuries sustained by Pasion on his skull proved fatal.

Appellants testified on their own behalf.

·          Bokingco: he was sleeping in Apartment No. 3 at around 1:20 a.m. when he was awakened by Pasion who appeared to be intoxicated. The latter wanted to know why he did not see Bokingco at the construction site on 28 Feb 2000. When Bokingco replied that he just stayed at the apartment the whole day, Pasion suddenly hit him in the head. This prompted Bokingco to take a hammer and hit Pasion. They both struggled and Bokingco repeatedly hit Pasion. Bokingco escaped to Manila right after the incident. He was subsequently arrested in Mindanao. Bokingco admitted that he harbored ill feelings towards Pasion.

·          Col:  confirmed that he was one of the construction workers employed by Pasion. He however resigned on 26 Feb 2000 because of the deductions from his salary. He went home to Cainta, Rizal, where he was apprehended and brought to Camp Olivas. Upon reaching the camp, he saw Bokingco who pointed to him as the person who killed Pasion. He insisted that he doesn’t know Bokingco very well.

rtc: guilty

·          Guilty of MURDER + two AC of nighttime and abuse of confidence to be considered against both accused and the mitigating circumstance of voluntary plea of guilty in favor of accused Bokingo only, hereby sentences each of them to suffer the penalty of DEATH.  

ca modified to reclusion perpetua

·          affirmed the findings of the TC but reduced the penalty to reclusion perpetua in view of RA 7659.

·          MR:

o    Bokingco’s fate when it rendered the challenged decision.

o    absence of other evidence, aside from Bokingco’s admission, to prove that conspiracy existed

o    admission made by Bokingco cannot be used as evidence against his alleged co-conspirator.

·          CA modified its Decision by including the criminal liability of Bokingco. BOKINGCO and COL are found GUILTY as conspirators of MURDER qualified by treachery and evident premeditation and with the attendant AC of nighttime and abuse of confidence, with no MC. The proper imposable penalty would have been death. Reclusion Perpetua without the possibility of parole.

issue #1: whether the qc were properly appreciated to convict Bokingco of murder. no, reduced to homicide.

Bokingco made 2 separate and dissimilar admissions:

·          extrajudicial confession taken during the preliminary investigation where he admitted that he and Col planned the killing of Pasion;

·          when he testified in open court that he was only provoked in hitting Pasion back when the latter hit him in the head.  

arguments of the appellants

·          no one from the prosecution witnesses testified on how Pasion was attacked by Bokingco. Evident premeditation was not proven in the case.

·          Nighttime was not purposely sought but it was merely co-incidental that the crime took place at that time.

·          Neither has trust and confidence been reposed on appellants by the victim to aggravate the crime by abuse of confidence.

·          They were living in an apartment owned by Pasion, not because the latter trusted them but because they worked in the construction of the victim’s apartment.

treachery:

·          For treachery to be appreciated, the prosecution must prove that at the time of the attack, the victim was not in a position to defend himself, and that the offender consciously adopted the particular means, method or form of attack employed by him.

·          Nobody witnessed the commencement and the manner of the attack. While the witness Vitalicio managed to see Bokingco hitting something on the floor, he failed to see the victim at that time.

evident premeditation

·          Requisites:

o    (a) the time when the offender was determined to commit the crime;

o    (b) an act manifestly indicating that the offender clung to his determination; and

o    (c) a sufficient interval of time between the determination and the execution of the crime to allow him to reflect upon the consequences of his act.

·          It is indispensable to show how and when the plan to kill was hatched or how much time had elapsed before it was carried out. Bokingco admitted in court that he only retaliated when Pasion allegedly hit him in the head. Despite the fact that Bokingco admitted that he was treated poorly by Pasion, the prosecution failed to establish that Bokingco planned the attack.

confession during the preliminary investigation is inadmissible

·          It was during the preliminary investigation that Bokingco mentioned his and Col’s plan to kill Pasion. Bokingco’s confession was admittedly taken without the assistance of counsel in violation of Sec 12, Art III of the 1987 Consti.

Sec 12. (1) Any person under investigation for the commission of an offense shall have the right to be informed of his right to remain silent and to have competent and independent counsel preferably of his own choice. If the person cannot afford the services of counsel, he must be provided with one. These rights cannot be waived except in writing and in the presence of counsel.

·          The right to counsel applies in certain pretrial proceedings that can be deemed ‘critical stages’ in the criminal process. The preliminary investigation can be no different from the in-custody interrogations by the police, for a suspect who takes part in a preliminary investigation will be subjected to no less than the State's processes, oftentimes intimidating and relentless, of pursuing those who might be liable for criminal prosecution.

·          The extrajudicial confession is inadmissible against Bokingco because he was not assisted at all by counsel during the time his confession was taken before a judge.

nighttime and abuse of confidence

·          The finding that nighttime attended the commission of the crime is anchored on the presumption that there was evident premeditation. Having ruled however that evident premeditation has not been proved, the aggravating circumstance of nighttime cannot be properly appreciated.  

·          Abuse of confidence could not also be appreciated as an aggravating circumstance in this case.

·          Taking into account that fact that Bokingco works for Pasion, it may be conceded that he enjoyed the trust and confidence of Pasion. However, there was no showing that he took advantage of said trust to facilitate the commission of the crime.

issue #2. whether Col is guilty beyond reasonable doubt as a co-conspirator. no.

·          Col:

o    to hold him guilty as co-conspirator, it must be established that he performed an overt act in furtherance of the conspiracy.            

o    Applying Sec 30, Rule 130 Col asserts that Bokingco’s uncounselled testimony that appellants planned to kill Pasion bears no relevance considering the fact that there was no other evidence which will prove the conspiracy.

·          Peaches’s statements during trial, such as the presence of Col inside her house and his forcing her to open the vault of the pawnshop, as well as the alleged statement she heard from Bokingco "Tara, patay na siya," are not adequate to support the finding of conspiracy.

·          OSG: Col blocked and attacked her with a knife when she tried to check on her husband. She was left alone by Col when he was told by Bokingco that the victim was already dead.  

conspiracy must be established with the same quantum of proof as the crime itself and must be shown as clearly as the commission of the crime.

·          Conspiracy exists when two or more persons come to an agreement to commit an unlawful act. It may be inferred from the conduct of the accused before, during, and after the commission of the crime.

·          Unity of purpose and unity in the execution of the unlawful objective are essential to establish the existence of conspiracy.

·          The finding of conspiracy was premised on Peaches’s testimony that appellants fled together after killing her husband and the extrajudicial confession of Bokingco.

·          Nobody witnessed the commencement of the attack. Col was not seen at the apartment where Pasion was being attacked by Bokingco.  

·          At the most, Col’s actuations can be equated to attempted robbery, which was actually the initial Info filed against appellants before it was amended, on motion of the prosecution, for murder.

·          Peaches testified that she heard Bokingco call out to Col that Pasion had been killed and that they had to leave the place. This does not prove that they acted in concert towards the consummation of the crime. It only proves, at best, that there were two crimes committed simultaneously and they were united in their efforts to escape from the crimes they separately committed.

·          Their acts did not reveal a unity of purpose that is to kill Pasion. Bokingco had already killed Pasion even before he sought Col.  

·          In as much as Bokingco’s extrajudicial confession is inadmissible against him, it is likewise inadmissible against Col, specifically where he implicated the latter as a cohort.

admission of a co-conspirator

·          GR: An extrajudicial confession is binding only on the confessant, is not admissible against his or her co-accused, and is considered as hearsay against them.

·          E: admission made by a conspirator, provided that:

o    conspiracy be first proved by evidence other than the admission itself;

o    admission relates to the common object;

o    it has been made while the declarant was engaged in carrying out the conspiracy.

·          Bokingco’s judicial admission exculpated Col because Bokingco admitted that he only attacked Pasion after the latter hit him in the head.

·           

treatment of the factual findings of the tc

·          GR: SC must accord roper deference to the factual findings of the TC, owing to their unique opportunity to observe the witnesses firsthand and note their demeanor, conduct, and attitude under grueling examination.

·          E:

o    when the TC’s findings of facts and conclusions are not supported by the evidence on record, 

o    when certain facts of substance and value likely to change the outcome of the case have been overlooked by the lower court, or

o    when the assailed decision is based on a misapprehension of facts.

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