G.R. No. 185894, 30 August 2017
FACTS:
On May 5, 2008, Belo Medical Group received a request from Santos for the inspection of corporate records. Santos claimed that he was a registered shareholder and a co-owner of Belo’s shares, as these were acquired while they cohabited as husband and wife. Belo objected to this request and wrote Belo Medical Group to repudiate Santos co-ownership of her shares and his interest in the corporation, claiming that the 25 shares in his name were merely in trust for her, as she, and not Santos, paid for these shares.
Belo Medical Group filed a Complaint for Interpleader to compel Belo and Santos to interplead and litigate their conflicting claims and declaratory relief, praying that Santos be perpetually barred from inspecting its books. The complaints were raffled to the special commercial court and were classified as intra-corporate.
Belo prayed that the case be tried as a civil case and not as an intra-corporate controversy, arguing that intra-corporate controversies did not include special civil actions for interpleader and declaratory relief, and clarified that the issue of ownership of the shares of stock must first be resolved before the issue on inspection could even be considered ripe for determination. Instead of filing an answer, Santos filed a Motion to Dismiss.
Though a motion to dismiss is a prohibited pleading under the Interim Rules of Procedure Governing Intra-Corporate Controversies, the trial court ruled that according to the Rules of Court, motions to dismiss are allowed in interpleader cases, while the complaint for Declaratory Relief was struck down as improper.
Belo filed her Petition for Review before the Court of Appeals while Belo Medical Group filed its Petition for Review with the Supreme Court. The Court of Appeals dismissed Belo’s Petition.
ISSUE:
Whether or not the controversy of Belo Medical Group, Belo and Santos is intra-corporate.
RULING:
This Court used both the relationship test and the nature of the controversy test to determine if an intra-corporate controversy is present. Applying the relationship test, this Court notes that both Belo and Santos are named shareholders in Belo Medical Group’s Articles of Incorporation and General.
The court stated that the conflict is clearly intra-corporate as it involves two shareholders although the ownership of stocks of one stockholder is questioned.
The nature of the controversy test, this is still an intra-¬corporate dispute. In the interpleader case, Belo Medical Group sought the disqualification of Santos from inspecting the corporate books based on bad faith. Therefore, the controversy shifts from a mere question of ownership over movable property to the exercise of a registered stockholder’s proprietary right to inspect corporate books.
The circumstances of the case and the aims of the parties must not be taken in isolation from one another.
The court further reiterated that, as the controversy is an intra-corporate dispute, Santos should not have been allowed to file a Motion to Dismiss. The trial court should have continued on with the case as an intra-corporate dispute considering that it called for the judgments on the relationship between a corporation and its two warring stockholders and the relationship of these two stockholders with each other.
*Case Digest by Jelyn C. Ondong, Refresher, Andres Bonifacio College, SY: 2019-2020