Bank of the Philippine Islands v. Eduardo Hong and the Court of Appeals

G.R. No. 161771, 15 February 2012

FACTS:

EYCO Group of Companies (“EYCO”) filed a petition for suspension of payments and rehabilitation before the Securities and Exchange Commission.

While the case was still pending with the CA, petitioner Bank of the Philippine Islands (BPI), filed with the Office of the Clerk of Court, Regional Trial Court of Valenzuela City, a petition for extra-judicial foreclosure of real properties mortgaged to it by Eyco Properties, Inc. and Blue Star Mahogany, Inc. Public auction of the mortgaged properties was scheduled on December 19, 2000.

After hearing, the trial court issued a temporary restraining order (TRO). Petitioner filed a motion to dismiss10 arguing that by plaintiff’s own allegations in the complaint, jurisdiction over the reliefs prayed for belongs to the SEC, and that plaintiff is actually resorting to forum shopping since he has filed a claim with the SEC and the designated Liquidator in the ongoing liquidation of the EYCO Group of Companies.

ISSUE:

Whether or not the RTC can take cognizance of a case already pending within the SEC.

RULING:

Yes. The RTC can take cognizance of the case for damages.

Perusal of the complaint reveals that respondent does not ask the trial court to rule on its interest or claim — as an unsecured creditor of two companies under EYCO — against the latter’s properties mortgaged to petitioner. The complaint principally seeks to enjoin the foreclosure proceedings initiated by petitioner over those properties on the ground that such properties are held in trust and placed under the jurisdiction of the appointed Liquidator in SEC Case No. 09-97-5764. Thus, Civil Case No. 349-V-00 is one for injunction with prayer for damages.

An action for injunction is a suit which has for its purpose the enjoinment of the defendant, perpetually or for a particular time, from the commission or continuance of a specific act, or his compulsion to continue performance of a particular act. It has an independent existence, and is distinct from the ancillary remedy of preliminary injunction which cannot exist except only as a part or an incident of an independent action or proceeding. In an action for injunction, the auxiliary remedy of preliminary injunction, prohibitory or mandatory.

As a rule, actions for injunction and damages lie within the jurisdiction of the RTC pursuant to Section 19 of Batas Pambansa Blg. 129, otherwise known as the “Judiciary Reorganization Act of 1980,” as amended by Republic Act (R.A.) No. 7691.

Sec. 19. Jurisdiction in civil cases. — Regional Trial Courts shall exercise exclusive original jurisdiction:

(1) In all civil actions in which the subject of the litigations is incapable of pecuniary estimation.

*Case Digest by Claudette Anne G. Sayson JD IV, S.Y. 2019-2020

By |2020-02-28T06:38:38+00:00February 10th, 2020|Case Digests|Comments Off on Bank of the Philippine Islands v. Eduardo Hong and the Court of Appeals