MKSE v. Campos

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SUPREMECOURTREPORTSANNOTATEDVOL.585
G.R.No.138814.April16,2009.*
MAKATI STOCK EXCHANGE, INC., MA. VIVIAN

YUCHENGCO, ADOLFO M. DUARTE, MYRON C. PAPA,
NORBERTO C. NAZARENO, GEORGE UYTIOCO, ANTONIO
A. LOPA, RAMON B. ARNAIZ, LUIS J.L. VIRATA, and
ANTONIO GARCIA, JR., petitioners, vs. MIGUEL V. CAMPOS,
substitutedbyJULIAORTIGASVDA.DECAMPOS,1respondent.
Actions Causes of Action Obligations Motion to Dismiss If a
defendantmovestodismissthecomplaintonthegroundoflackofcauseof
action, he is regarded as having hypothetically admitted all the averments
thereof.Acauseofactionistheactoromissionbywhichapartyviolatesa
rightofanother.Acomplaintstatesacauseofactionwhereitcontainsthree
essential elements of a cause of action, namely: (1) the legal right of the
plaintiff, (2) the correlative obligation of the defendant, and (3) the act or
omission of the defendant in violation of said legal right. If these elements
are absent, the complaint becomes vulnerable to dismissal on the ground of
failure to state a cause of action. If a defendant moves to dismiss the
complaintonthegroundoflackofcauseofaction,heisregardedashaving
hypothetically admitted all the averments thereof. The test of sufficiency of
thefactsfoundinacomplaintasconstitutingacauseofactioniswhetheror
not admitting the facts alleged, the court can render a valid judgment upon
the same in accordance with the prayer thereof. The hypothetical admission
extends to the relevant and material facts well pleaded in the complaint and
inferences fairly deducible therefrom. Hence, if the allegations in the
complaintfurnishsufficientbasisbywhichthecomplaintcanbemaintained,
the same should not be dismissed regardless of the defense that may be
assessedbythedefendant.
SameSameSameWordsandPhrasesRightandobligationarelegal
termswithspecificlegalmeaningarightisaclaimortitletoaninterestin
anythingwhatsoeverthatisenforceablebylawwhile
_______________
*THIRDDIVISION.
1PerResolutionof24October2001.
http://www.central.com.ph/sfsreader/session/00000150ec447b20af5b981d000a3ae1981391c4/p/AQM050/?username=Guest
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VOL.585,APRIL16,2009
121
MakatiStockExchange,Inc.vs.Campos
anobligationisdefinedintheCivilCodeasajuridicalnecessitytogive,to
do or not to do For every right enjoyed by any person, there is a
corresponding obligation on the part of another person to respect such
right.There is no question that the Petition in SEC Case No. 02944678
asserts a right in favor of respondent, particularly, respondents alleged
right to subscribe to the IPOs of corporations listed in the stock market at
their offering prices and stipulates the correlative obligation of petitioners
torespectrespondentsright,specifically,bycontinuingtoallowrespondent
to subscribe to the IPOs of corporations listed in the stock market at their
offering prices. However, the terms right and obligation in respondents
Petitionarenotmagicwordsthatwouldautomaticallyleadtotheconclusion
that such Petition sufficiently states a cause of action. Right and obligation
arelegaltermswithspecificlegalmeaning.Arightisaclaimortitletoan
interest in anything whatsoever that is enforceable by law. An obligation is
definedintheCivilCodeasajuridicalnecessitytogive,todoornottodo.
Foreveryrightenjoyedbyanyperson,thereisacorrespondingobligationon
thepartofanotherpersontorespectsuchright.Thus,JusticeJ.B.L.Reyes
offers the definition given by Arias Ramos as a more complete definition:
An obligation is a juridical relation whereby a person (called the creditor)
may demand from another (called the debtor) the observance of a
determinativeconduct(thegiving,doingornotdoing),andincaseofbreach,
maydemandsatisfactionfromtheassetsofthelatter.
Same Same Same Civil Law Pleadings and Practice The mere
assertion of a right and claim of an obligation in an initiatory pleading,
whether a Complaint or Petition, without identifying the basis or source
thereof,ismerelyaconclusionoffactandlawapleadingshouldstatethe
ultimate facts essential to the rights of action or defense asserted, as
distinguished from mere conclusions of fact or conclusions of law.The
Civil Code enumerates the sources of obligations: Art.1157. Obligations
arise from: (1) Law (2) Contracts (3) Quasicontracts (4) Acts or
omissions punished by law and (5) Quasidelicts. Therefore, an obligation
imposed on a person, and the corresponding right granted to another, must
berootedinatleastoneofthesefivesources.Themereassertionofaright
andclaimofanobligationinaninitiatorypleading,whetheraComplaintor
Petition, without identifying the basis or source thereof, is merely a
conclusionoffactandlaw.Apleadingshouldstatetheultimatefacts
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122
122
SUPREMECOURTREPORTSANNOTATED
essential to the rights of action or defense asserted, as distinguished from

mere conclusions of fact or conclusions of law. Thus, a Complaint or
Petition filed by a person claiming a right to the Office of the President of
thisRepublic,butwithoutstatingthesourceofhispurportedright,cannotbe
saidtohavesufficientlystatedacauseofaction.Also,apersonclaimingto
betheownerofaparceloflandcannotmerelystatethathehasarighttothe
ownership thereof, but must likewise assert in the Complaint either a mode
ofacquisitionofownershiporatleastacertificateoftitleinhisname.
SameSameSameWordsandPhrasesApracticeorcustomis,asa
generalrule,notasourceofalegallydemandableorenforceableright.A
meticulous review of the Petition reveals that the allocation of IPO shares
was merely alleged to have been done in accord with a practice normally
observed by the members of the stock exchange, to wit: IPOs are shares of
corporationsofferedforsaletothepublic,priortotheirlistinginthetrading
floor of the countrys two stock exchanges. Normally, TwentyFive
Percent(25%)ofthesesharesaredividedequallybetweenthetwostock
exchanges which in turn divide these equally among their members,
who pay therefor at the offering price. A practice or custom is, as a
general rule, not a source of a legally demandable or enforceable right.
Indeed, in labor cases, benefits which were voluntarily given by the
employer, and which have ripened into company practice, are considered as
rightsthatcannotbediminishedbytheemployer.Nevertheless,eveninsuch
cases, the source of the employees right is not custom, but ultimately, the
law, since Article 100 of the Labor Code explicitly prohibits elimination or
diminutionofbenefits.
PETITIONforreviewoncertiorariofthedecisionandresolutionof
theCourtofAppeals.
ThefactsarestatedintheopinionoftheCourt.
Rodrigo,Berenguer&Gunoforpetitioners.
PasteleroLawOfficeforrespondent.
123
123
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CHICONAZARIO,J.:
ThisisaPetitionforReviewonCertiorariunderRule45seeking
thereversaloftheDecision2dated11February1997andResolution
dated 18 May 1999 of the Court of Appeals in CAG.R. SP No.
38455.
Thefactsofthecaseareasfollows:
SECCaseNo.02944678wasinstitutedon10February1994by
respondent Miguel V. Campos, who filed with the Securities,
InvestigationandClearingDepartment(SICD)oftheSecuritiesand
Exchange Commission (SEC), a Petition against herein petitioners
Makati Stock Exchange, Inc. (MKSE) and MKSE directors, Ma.
VivianYuchengco,AdolfoM.Duarte,MyronC.Papa,NorbertoC.
Nazareno, George UyTioco, Antonio A. Lopa, Ramon B. Arnaiz,
Luis J.L. Virata, and Antonio Garcia, Jr. Respondent, in said
Petition,sought:(1)thenullificationoftheResolutiondated3June
1993 of the MKSE Board of Directors, which allegedly deprived
him of his right to participate equally in the allocation of Initial
Public Offerings (IPO) of corporations registered with MKSE (2)
the delivery of the IPO shares he was allegedly deprived of, for
whichhewouldpayIPOpricesand(3)thepaymentofP2million
as moral damages, P1 million as exemplary damages, and
P500,000.00asattorneysfeesandlitigationexpenses.
On 14 February 1994, the SICD issued an Order granting
respondents prayer for the issuance of a Temporary Restraining
Order to enjoin petitioners from implementing or enforcing the 3
June1993ResolutionoftheMKSEBoardofDirectors.
TheSICDsubsequentlyissuedanotherOrderon10March1994
granting respondents application for a Writ of Preliminary
Injunction,tocontinuouslyenjoin,duringthependency
_______________
2PennedbyAssociateJusticeEubuloG.VerzolawithAssociateJusticesJesusM.
ElbiniasandHilarionL.Aquino,concurringRollo,pp.3036.
124
124
ofSECCaseNo.02944678,theimplementationorenforcementof
the MKSE Board Resolution in question. Petitioners assailed this
SICDOrderdated10March1994inaPetitionforCertiorarifiled
withtheSECenbanc,docketedasSECEBNo.393.
On 11 March 1994, petitioners filed a Motion to Dismiss
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respondents Petition in SEC Case No. 02944678, based on the

following grounds: (1) the Petition became moot due to the
cancellation of the license of MKSE (2) the SICD had no
jurisdiction over the Petition and (3) the Petition failed to state a
causeofaction.
The SICD denied petitioners Motion to Dismiss in an Order
dated 4 May 1994. Petitioners again challenged the 4 May 1994
OrderofSICDbeforetheSECenbancthroughanotherPetitionfor
Certiorari,docketedasSECEBNo.403.
InanOrderdated31May1995inSECEBNo.393,theSECen
bancnullifiedthe10March1994OrderofSICDinSECCaseNo.
02944678 granting a Writ of Preliminary Injunction in favor of
respondent.Likewise,inanOrderdated14August1995inSECEB
No.403,theSECenbancannulledthe4May1994OrderofSICD
in SEC Case No. 02944678 denying petitioners Motion to
Dismiss, and accordingly ordered the dismissal of respondents
PetitionbeforetheSICD.
Respondent filed a Petition for Certiorari with the Court of
AppealsassailingtheOrdersoftheSECenbancdated31May1995
and 14 August 1995 in SECEB No. 393 and SECEB No. 403,
respectively. Respondents Petition before the appellate court was
docketedasCAG.R.SPNo.38455.
On 11 February 1997, the Court of Appeals promulgated its
DecisioninCAG.R.SPNo.38455,grantingrespondentsPetition
forCertiorari,thus:
WHEREFORE, the petition in so far as it prays for annulment of the
OrdersdatedMay31,1995andAugust14,1995inSECEB
125
125
CaseNos.393and403isGRANTED.Thesaidordersareherebyrendered
nullandvoidandsetaside.
Petitioners filed a Motion for Reconsideration of the foregoing

DecisionbutitwasdeniedbytheCourtofAppealsinaResolution
dated18May1999.
Hence, the present Petition for Review raising the following
arguments:
I.
THE SEC EN BANC DID NOT COMMIT GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OR EXCESS OF
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JURISDICTION WHEN IT DISMISSED THE PETITION FILED BY

RESPONDENT BECAUSE ON ITS FACE, IT FAILED TO STATE A
CAUSEOFACTION.
II.
THE GRANT OF THE IPO ALLOCATIONS IN FAVOR OF
RESPONDENT WAS A MERE ACCOMMODATION GIVEN TO HIM
BY THE BOARD OF [DIRECTORS] OF THE MAKATI STOCK
EXCHANGE,INC.
III.
THECOURTOFAPPEALSERREDINHOLDINGTHATTHESECEN
BANCCOMMITTEDGRAVEABUSEOFDISCRETIONAMOUNTING
TO LACK OR EXCESS OF JURISDICTION WHEN IT MADE AN
EXTENDED INQUIRY AND PROCEEDED TO MAKE A
DETERMINATION AS TO THE TRUTH OF RESPONDENTS
ALLEGATIONS IN HIS PETITION AND USED AS BASIS THE
EVIDENCE ADDUCED DURING THE HEARING ON THE
APPLICATIONFORTHEWRITOFPRELIMINARYINJUNCTIONTO
DETERMINETHEEXISTENCEORVALIDITYOFASTATEDCAUSE
OFACTION.
IV.
IPO ALLOCATIONS GRANTED TO BROKERS ARE NOT TO BE
BOUGHT BY THE BROKERS FOR THEMSELVES BUT ARE TO BE
DISTRIBUTEDTOTHEINVESTINGPUBLIC.HENCE,RE
126
126
SPONDENTS CLAIM FOR DAMAGES IS ILLUSORY AND HIS

PETITIONANUISANCESUIT.3
On18September2001,counselforrespondentmanifestedtothis
Courtthathisclientdiedon7May2001.InaResolutiondated24
October 2001, the Court directed the substitution of respondent by
hissurvivingspouse,JuliaOrtigasvda.deCampos.
PetitionerswantthisCourttoaffirmthedismissalbytheSECen
banc of respondents Petition in SEC Case No. 02944678 for
failure to state a cause of action. On the other hand, respondent
insists on the sufficiency of hisPetition and seeks thecontinuation
oftheproceedingsbeforetheSICD.
Acauseofactionistheactoromissionbywhichapartyviolates
a right of another.4 A complaint states a cause of action where it
contains three essential elements of a cause of action, namely: (1)
the legal right of the plaintiff, (2) the correlative obligation of the
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defendant,and(3)theactoromissionofthedefendantinviolation
of said legal right. If these elements are absent, the complaint
becomesvulnerabletodismissalonthegroundoffailuretostatea
causeofaction.
Ifadefendantmovestodismissthecomplaintonthegroundof
lack of cause of action, he is regarded as having hypothetically
admitted all the averments thereof. The test of sufficiency of the
facts found in a complaint as constituting a cause of action is
whether or not admitting the facts alleged, the court can render a
validjudgmentuponthesameinaccordancewiththeprayerthereof.
The hypothetical admission extends to the relevant and material
facts well pleaded in the complaint and inferences fairly deducible
therefrom. Hence, if the allegations in the complaint furnish
sufficientbasisbywhichthecomplaintcanbemaintained,thesame
shouldnot
_______________
3Rollo,p.144.
4RevisedRulesofCourt,Rule2,Section2.
127
127
bedismissedregardlessofthedefensethatmaybeassessedbythe
defendant.5
Given the foregoing, the issue of whether respondents Petition
in SEC Case No. 02944678 sufficiently states a cause of action
may be alternatively stated as whether, hypothetically admitting to
betruetheallegationsinrespondentsPetitioninSECCaseNo.02
944678,theSICDmayrenderavalidjudgmentinaccordancewith
theprayerofsaidPetition.
AreadingoftheexacttextofrespondentsPetitioninSECCase
No.02944678is,therefore,unavoidable.Pertinentportionsofthe
saidPetitionreads:
7.In recognition of petitioners invaluable services, the general
membership of respondent corporation [MKSE] passed a resolution
sometime in 1989 amending its Articles of Incorporation, to include the
followingprovisiontherein:
ELEVENTHWHEREAS, Mr. Miguel Campos is the only
surviving incorporator of the Makati Stock Exchange, Inc. who has
maintainedhismembership
WHEREAS,he has unselfishly served the Exchange in various
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capacities, as governor from 1977 to the present and as President

from1972to1976andagainasPresidentfrom1988tothepresent
WHEREAS, such dedicated service and leadership which has
contributed to the advancement and well being not only of the
Exchange and its members but also to the Securities industry, needs
toberecognizedandappreciated
WHEREAS,assuch,theBoardofGovernorsinitsmeetingheld
on February 09, 1989 has correspondingly adopted a resolution
recognizing his valuable service to the Exchange, reward the same,
andpreserveforposteritysuchrecognitionbyproposingaresolution
to the membership body which would make him as Chairman
Emeritus for life and install in the Exchange premises a
commemorativebronzeplaqueinhishonor
_______________
5FilEstateGolfandDevelopment,Inc.v.CourtofAppeals,333Phil.465,490491265
SCRA614,637(1996).
128
128
NOW, THEREFORE, for and in consideration of the above

premises,thepositionoftheChairmanEmeritustobeoccupiedby
Mr. Miguel Campos during his lifetime and irregardless of his
continuedmembershipintheExchangewiththePrivilegetoattendall
membership meetings as well as the meetings of the Board of
GovernorsoftheExchange,isherebycreated.
8.Hence, to this day, petitioner is not only an active member of the
respondentcorporation,butitsChairmanEmeritusaswell.
9.Correspondingly, at all times material to this petition, as an active
member and Chairman Emeritus of respondent corporation, petitioner has
alwaysenjoyedtherightgiventoalltheothermemberstoparticipateequally
intheInitialPublicOfferings(IPOsforbrevity)ofcorporations.
10.IPOsaresharesofcorporationsofferedforsaletothepublic,prior
to the listing in the trading floor of the countrys two stock exchanges.
Normally, Twenty Five Percent (25%) of these shares are divided equally
between the two stock exchanges which in turn divide these equally among
theirmembers,whopaythereforattheofferingprice.
11.However, on June 3, 1993, during a meeting of the Board of
Directors of respondentcorporation, individual respondents passed a
resolutiontostop giving petitioner the IPOs he is entitled to, based on the
groundthat these shares were allegedly benefiting Gerardo O. Lanuza, Jr.,
whothese individual respondents wanted to get even with, for having filed
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casesbeforetheSecuritiesandExchange(SEC)fortheirdisqualificationas
memberoftheBoardofDirectorsofrespondentcorporation.
12.Hence,fromJune3,1993uptothepresenttime,petitionerhasbeen
deprivedofhisrightto subscribe to the IPOs of corporations listing in the
stockmarketattheirofferingprices.
13.The collective act of the individual respondents in depriving
petitionerofhisrighttoashareintheIPOsfortheaforementionedreason,
is unjust, dishonest and done in bad faith, causing petitioner substantial
financialdamage.6
_______________
6Rollo,pp.5052.
129
129
There is no question that the Petition in SEC Case No. 0294

4678 asserts a right in favor of respondent, particularly,
respondents alleged right to subscribe to the IPOs of corporations
listedinthestockmarketattheirofferingpricesandstipulatesthe
correlative obligation of petitioners to respect respondents right,
specifically, by continuing to allow respondent to subscribe to the
IPOs of corporations listed in the stock market at their offering
prices.
However,thetermsrightandobligationinrespondentsPetition
arenotmagicwordsthatwouldautomaticallyleadtotheconclusion
that such Petition sufficiently states a cause of action. Right and
obligationarelegaltermswithspecificlegalmeaning.Arightisa
claim or title to an interest in anything whatsoever that is
enforceablebylaw.7AnobligationisdefinedintheCivilCodeasa
juridical necessity to give, to do or not to do.8 For every right
enjoyed by any person, there is a corresponding obligation on the
part of another person to respect such right. Thus, Justice J.B.L.
Reyes offers9 the definition given by Arias Ramos as a more
completedefinition:
An obligation is a juridical relation whereby a person (called the
creditor) may demand from another (called the debtor) the observance of a
determinativeconduct(thegiving,doingornotdoing),andincaseofbreach,
maydemandsatisfactionfromtheassetsofthelatter.
TheCivilCodeenumeratesthesourcesofobligations:
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Art.1157.Obligationsarisefrom:
(1)Law
(2)Contracts
(3)Quasicontracts
_______________
7Baileyv.Miller,91N.E.24,25,Ind.App.475,citedin37AWordsandPhrases363.
8CivilCode,Article1156.
9LawyersJournal,31January1951,p.47.
130
130
(4)Actsoromissionspunishedbylawand
(5)Quasidelicts.
Therefore, an obligation imposed on a person, and the

correspondingrightgrantedtoanother,mustberootedinatleastone
ofthesefivesources.Themereassertionofarightandclaimofan
obligationinaninitiatorypleading,whetheraComplaintorPetition,
without identifying the basis or source thereof, is merely a
conclusionoffactandlaw.Apleadingshouldstatetheultimatefacts
essentialtotherightsofactionordefenseasserted,asdistinguished
from mere conclusions of fact or conclusions of law.10 Thus, a
ComplaintorPetitionfiledbyapersonclaimingarighttotheOffice
of the President of this Republic, but without stating the source of
hispurportedright,cannotbesaidtohavesufficientlystatedacause
ofaction.Also,apersonclaimingtobetheownerofaparcelofland
cannotmerelystatethathehasarighttotheownershipthereof,but
mustlikewiseassertintheComplainteitheramodeofacquisitionof
ownershiporatleastacertificateoftitleinhisname.
Inthecaseatbar,althoughthePetitioninSECCaseNo.0294
4678 does allege respondents right to subscribe to the IPOs of
corporations listed in the stock market at their offering prices, and
petitioners obligation to continue respecting and observing such
right, the Petition utterly failed to lay down the source or basis of
respondentsrightand/orpetitionersobligation.
Respondent merely quoted in his Petition the MKSE Board
Resolution, passed sometime in 1989, granting him the position of
ChairmanEmeritusofMKSEforlife.However,thereisnothingin
thesaidPetitionfromwhichtheCourtcandeducethatrespondent,
by virtue of his position as Chairman Emeritus of MKSE, was
grantedbylaw,contract,orany
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_______________
10Abadv.CourtofFirstInstanceofPangasinan,G.R.Nos.5850708,26February
1992,206SCRA567,579580.
131
131
otherlegalsource,therighttosubscribetotheIPOsofcorporations
listedinthestockmarketattheirofferingprices.
AmeticulousreviewofthePetitionrevealsthattheallocationof
IPOshareswasmerelyallegedtohavebeendoneinaccordwitha
practicenormallyobservedbythemembersofthestockexchange,
towit:
IPOsaresharesofcorporationsofferedforsaletothepublic,priortotheir
listinginthetradingfloorofthecountrystwostockexchanges.Normally,
TwentyFivePercent(25%)ofthesesharesaredividedequallybetween
thetwostockexchangeswhichinturndividetheseequallyamongtheir
members,whopaythereforattheofferingprice.11(Emphasissupplied)
A practice or custom is, as a general rule, not a source of a

legally demandable or enforceable right.12 Indeed, in labor cases,
benefits which were voluntarily given by the employer, and which
have ripened into company practice, are considered as rights that
cannotbediminishedbytheemployer.13Nevertheless,eveninsuch
cases, the source of the employees right is not custom, but
ultimately, the law, since Article 100 of the Labor Code explicitly
prohibitseliminationordiminutionofbenefits.
There is no such law in this case that converts the practice of
allocating IPO shares to MKSE members, for subscription at their
offeringprices,intoanenforceableordemandableright.Thus,even
if it is hypothetically admitted that normally, twenty five percent
(25%) of the IPOs are divided equally between the two stock
exchangeswhich,inturn,
_______________
11Rollo,pp.5152.
12 A distinction, however, should be made between Municipal Law and Public
InternationalLaw.CustomisoneoftheprimarysourcesofInternationalLaw,andis
thusasourceoflegalrightswithinsuchsphere.
13ArcoMetalProductsCo.,Inc.v.SamahanngmgaManggagawasaArcoMetal
NAFLU,G.R.No.170734,14May2008,554SCRA110,118.
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132
132
divide their respective allocation equally among their members,

including the Chairman Emeritus, who pay for IPO shares at the
offering pricethe Court cannot grant respondents prayer for
damageswhichallegedlyresultedfromtheMKSEBoardResolution
dated 3 June 1993 deviating from said practice by no longer
allocatinganysharestorespondent.
Accordingly,theinstantPetitionshouldbegranted.ThePetition
inSECCaseNo.02944678shouldbedismissedforfailuretostate
a cause of action. It does not matter that the SEC en banc, in its
Order dated 14 August 1995 in SECEB No. 403, overstepped its
bounds by not limiting itself to the issue of whether respondents
Petition before the SICD sufficiently stated a cause of action. The
SEC en banc may have been mistaken in considering extraneous
evidence in granting petitioners Motion to Dismiss, but its
discussionthereofaremerelysuperfluousandobiterdictum.Inthe
main, the SEC en banc did correctly dismiss the Petition in SEC
Case No. 02944678 for its failure to state the basis for
respondentsallegedright,towit:
PrivaterespondentCamposhasfailedtoestablishthebasisorauthority
for his alleged right to participate equally in the IPO allocations of the
Exchange.Hecitedparagraph11oftheamendedarticlesofincorporationof
the Exchange in support of his position but a careful reading of the said
provisionshowsnothingthereinthatwouldbearouthisclaim.Theprovision
merely created the position of chairman emeritus of the Exchange but it
mentioned nothing about conferring upon the occupant thereof the right to
receiveIPOallocations.14
WiththedismissalofrespondentsPetitioninSECCaseNo.02
944678, there is no more need for this Court to resolve the
proprietyoftheissuancebySCIDofawritofpreliminaryinjunction
insaidcase.
_______________
14Rollo,p.95.
133
133
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WHEREFORE,thePetitionisGRANTED.TheDecisionofthe
Court of Appeals dated 11 February 1997 and its Resolution dated
18May1999inCAG.R.SPNo.38455areREVERSEDandSET
ASIDE.TheOrdersdated31May1995and14August1995ofthe
SecuritiesandExchangeCommissionenbancinSECEBCaseNo.
393 and No. 403, respectively, are hereby reinstated. No
pronouncementastocosts.
SOORDERED.
YnaresSantiago (Chairperson), AustriaMartinez, Nachura
andPeralta,JJ.,concur.
Petitiongranted,judgmentandresolutionreversedandsetaside.
Notes.The jurisdiction of the court over the subject matter is
determinedupontheallegationsmadeinthecomplaint,irrespective
ofwhethertheplaintiffisentitledornottorecoverupontheclaim
asserted. (Davao Abaca Plantation Company, Inc. vs. Dole
Philippines,Inc.,346SCRA682[2000])
Ifthesuitisnotbroughtinthenameof,oragainst,therealparty
ininterest,aMotiontoDismissmaybefiledonthegroundthatthe
Complaint states no cause of action. (Strongworld Construction
Corporationvs.Perello,496SCRA700[2006])
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MAKATI STOCK EXCHANGE, INC., MA. VIVIAN

essential to the rights of action or defense asserted, as distinguished from

respondents Petition in SEC Case No. 02944678, based on the

Petitioners filed a Motion for Reconsideration of the foregoing

JURISDICTION WHEN IT DISMISSED THE PETITION FILED BY

SPONDENTS CLAIM FOR DAMAGES IS ILLUSORY AND HIS

capacities, as governor from 1977 to the present and as President

NOW, THEREFORE, for and in consideration of the above

There is no question that the Petition in SEC Case No. 0294

Therefore, an obligation imposed on a person, and the

A practice or custom is, as a general rule, not a source of a

divide their respective allocation equally among their members,

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