G.R. No. 192951, 14 November 2012


Sometime in March 1991, petitioners filed a case against the respondents before the Securities and Exchange Commission (SEC). When the SEC was reorganized pursuant to Republic Act 8799,4 the case was transferred to the RTC of Nueva Vizcaya for further proceedings. Pre-trial thereafter ensued and a Pre-Trial Order was issued enumerating the following issues:

[a] which of the contending trustees and officers are legally elected in accordance with the 1970 By-Laws;
[b] whether the withdrawals and disbursements are in accordance with the By-Laws;
[c] whether there was a complete, audited report and accounting of all the corporate funds;
[d] whether respondents Gauuan, Villaluz, Arreola and the banks, are jointly and severally liable to indemnify the school for all sums of money withdrawn, disbursed, paid, diverted and unaccounted for without the approval and counter-signature of the chairman;
[e] whether there was a demand of a right of inspection and a refusal to allow inspection, and
[f] whether respondents are liable for damages.

In a motion dated August 10, 2003, respondents sought the dismissal of the complaint but such was denied. On February 2010 a Motion to Withdraw and/or to Dismiss Case, alleging that the case was instituted without any board resolution authorizing its filing and that the incumbent members of the Board of Trustees of petitioner Aldersgate College, Inc. had recently passed a resolution which sought the dismissal and/or withdrawal of the case. RTC granted the motion on the basis of such Board of Trustees resolution.


Whether or not the RTC erred in dismissing the case.


Yes. The RTC should not have entertained the subject motion to dismiss. Under Section 8, Rule 1 of the Interim Rules of Procedure for Intra-Corporate Controversies, a motion to dismiss is a prohibited pleading.

As this case involves an intra-corporate dispute, the motion to dismiss is undeniably a prohibited pleading.

Moreover, the Court finds no justification for the dismissal of the case based on the mere issuance of a board resolution by the incumbent members of the Board of Trustees of petitioner corporation recommending its dismissal, especially considering the various issues raised by the parties before the court a quo. Hence, the RTC should not have entertained, let alone have granted the subject motion to dismiss.

*Case Digest by Catherine C. Velasco, LLB-IV, Andres Bonifacio Law School, SY 2019-2020