G.R. No. 182571, 2 September 2013

FACTS:

Esguerra filed with RTC, Malolos, Bulacan an action to annul the Free Patent in the name of De Guzman. Esguerra claimed that he was the owner of certain parcel land. Esguerra learned that the said parcel of land was being offered for sale by De Guzman to Hi-Cement Corporation, The former possessor of the land, Maningas, was issued with a patent which was subsequently issued in the name of De Guzman over said parcel of land. Esguerra also demanded that the poriton of his property, which has been encroached upon and included in de Guzman’s Free Patent, be excluded. He later amended his complaint to implead Hi-Cement as co-defendant since the latter was hauling marble from the subject land. He also prayed that Hi-Cement be ordered to desist from hauling marble, to account for the marble already hauled and to pay him.

The RTC dismissed Esguerra’s complaint but the CA reversed the said decision. The SC affirmed the decision of the CA. After attaining finality, the case was remanded to the RTC for execution.

The heirs of Esguerra filed an Omnibus Motion manifesting that the Court has yet to execute the decision. Subsequently, the RTC ordered the execution of the said motion. Contrary to the order, de Guzman and HOLCIM were not examined, rather, the petitioners preseted Balicanta who testified upon and examination of the topographical maps covering the land of the deceased Esguerra, the estimated volum of limestone hauled therefrom covering the years 1990 to 2003 were presented. Later, the petitioners filed a Supplement to the Motion for Execution and a Motion for Alias Writ of Execution claiming that the royalties due them were 91 million pesos. The RTC granted the same.

HOLCIM filed a MR alleging that it did not owe any amount of royalty to the petitioners. Furthermore, it averred that it had already paid an aggregate sum of 694k, an amount more than the 218k which the petitioners were entitled under the agreement. Petitioners allege that HOLCIM is barred by estoppel to question the execution of the decision based on the Agreement, because said agreement is in contravention with the trial court’s previous orders which required HOLCIM to deposit to the clerk of court the royalties due the deceased Esguerra. The petitioners also argues that the agreement is a way to evade the trial court’s orders and has been procured by taking advantage of the petitioner’s financial distress after Esguerra died.

HOLCIM filed with the CA a petition for Certiorari, by which the latter reversed and set aside the previous decision. Hence, this case.

ISSUE:

Whether HOLCIM failed to comply with the rules by not securing a certified true copy of a board resolution authorizing any of its officers to file said petition?

RULING:

The general rule is that a corporation can only exercise its powers and transact its business through its board of directors and through its officers and agents when authorized by a board resolution or its bylaws. The power of a corporation to sue and be sued is exercised by the boardof directors. The physical acts of the corporation, like the signing of documents, can be performed only by natural persons duly authorized for the purpose by corporate bylaws or by a specific actof the board. Absent the said board resolution, a petition may not be given due course.

HOLCIM attached all the necessary documents for the filing of a petition for certiorari before the CA.

Indeed, there was no complete failure to attach a Certificate of Non-Forum Shopping. Infact, there was such a certificate. While the board resolution may not have been attached, HOLCIM complied just the same when it attached the Secretary’s Certificate dated July 17, 2006, thusproving that O’Callaghan had the authority from the board of directors to appoint the counsel torepresent them in Civil Case No. 725-M-89. The Court recognizes the compliance made byHOLCIM in good faith since after the petitioners pointed out the said defect, HOLCIM submitted the Secretary’s Certificate dated July 17, 2006, confirming the earlier Secretary’s Certificate datedJune 9, 2006. For the Court, the ruling in General Milling Corporation v. NLRC59 is applicablewhere the Court rendered a decision in favor of the petitioner despite its failure to attach theCertification of Non- Forum Shopping. The Court held that there was substantial compliance whenit eventually submitted the required documents. Substantial justice dictates that technical andprocedural rules must give way because a deviation from the rigid enforcement of the rules willbetter serve the ends of justice.

The rules of procedure are intended to promote, rather than frustrate, the ends of justice, and while the swift unclogging of court dockets is a laudable objective, it, nevertheless, must not be met at the expense of substantial justice. Technical and procedural rules are intended to help secure, not suppress, the cause of justice and a deviation from the rigid enforcement of the rules may be allowed to attain that prime objective for, after all, the dispensation of justice is the core reason for the existence of courts.

*Case Digest by Jhazel Zhan Jebone, JD-4, Andres Bonifacio Law School, SY 2019-2020