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Quisumbing v.

Sandiganbayan distinct personality from its stockholders; and that


the said Order was issued without proper authority,
Facts having been signed by only one Commissioner, in
violation of Sec. 3 of the PCGG Rules requiring at
By virtue of a Writ of Sequestration, the least two Commissioners to sign any order.
Presidential Commission on Good Government
(PCGG) filed a complaint before the Petitioner's Motion for Reconsideration having
Sandiganbayan for recovery, conveyance and been denied, the present petition (for Certiorari)
accounting of various properties and assets of was filed. This time, petitioner faults the
Benjamin Romualdez, deposed President Sandiganbayan solely for its finding that the
Ferdinand Marcos, former First lady Imelda Republic is a real party in interest.
Romualdez Marcos, and their alleged dummies
and cohorts, on the ground that those constitute Issue
ill-gotten wealth.
Whether or not the proper remedy (for the denial
During the pendency of Civil Case No. 0035, the of a motion to dismiss) is a petition for certiorari
then PCGG-appointed members of the PJI Board of
Directors, executed a Contract of and a Deed of Held
Absolute Conveyance covering the Mabini lots in
favor of petitioner, acting as trustee of the Doy NO. The Court notes that, indeed, the assailed
Development Corporation. Resolutions denying petitioner's motion to dismiss
are interlocutory, hence, not the proper subject of
The Sandiganbayan, acting on the "Urgent Motion a petition for certiorari.
to Enjoin PCGG- Appointed Board of Directors from
Effecting Sale of PJI Real Properties" filed by PJI An order denying a motion to dismiss is an
stockholder Rosario Olivares, nullified the interlocutory order which neither terminates nor
management contracts, by Resolution on the finally disposes of a case, as it leaves something
ground that they were entered into by the to be done by the court before the case is finally
abovementioned PJI members of the Board decided on the merits.
without the Sandiganbayan's prior approval and
consent of the PCGG. As such, the general rule is that the denial of a
motion to dismiss cannot be questioned in a
Jaime Cura, then President of the PJI who was the special civil action for certiorari which is a remedy
signatory to the contracts, assailed via certiorari designed to correct errors of jurisdiction and not
the Sandiganbayan February 22, 1992 Resolution errors of judgment.
before this Court in G.R. No. 106209. By
Resolution, this Court sustained the Neither can the denial of a motion to dismiss be
Sandiganbayan, it holding that PJI is a the subject of an appeal unless and until a final
sequestered corporation and all its properties and judgment or order is rendered. In order to justify
assets are considered as under custodia legis. the grant of the extraordinary remedy of certiorari,
the denial of the motion to dismiss must have been
Now, PCGG and PJI thereupon filed before the tainted with grave abuse of discretion amounting
Sandiganbayan a Complaint against petitioner and to lack or excess of jurisdiction
the PCGG-appointed PJI members of the Board for
reconveyance of the Mabini lots, the subject of the (Note: The Ruling is more on real party in interest.
present petition. Kindly read the fulltext :D )

To the complaint, petitioner filed a Motion to


Dismiss on the ground of lack of cause of action
on the part of the PCGG and the Republic.
Petitioner contended that the Mabini lots were
never sequestered nor placed in custodia legis,
hence, the prior authorization of the
Sandiganbayan and the consent of PCGG were not
necessary; that the Sequestration Order dated
April 22, 1996 covered only the shares of
Benjamin Romualdez, his relatives, agents and
nominees, and not the assets and properties of PJI
which is a corporation having a separate and
Strongworld Construction Corporation v. respondents First Peoples Bank and Francisco be
Perello declared in default.

Facts Resolving petitioners Motion for Clarification, the


trial court issued an Order in open court, dated 17
On 30 March 1998, the trial court granted July 1998, reiterating that the case should remain
petitioners Motion for Reconsideration, and dismissed as petitioners Motion for
consequently, ordered the case reinstated. Reconsideration was defective, and hence,
unbinding against the Order of 7 May 1998.
According to the court a quo, the board resolution Similarly, the trial court corrected the Order of 29
authorizing petitioner Gamolo to prosecute the May 1998 to refer to the Order of 7 May 1998,
case in behalf of petitioner Strongworld was which sustained the dismissal of the case. The
defective for not having been authenticated by the court a quo reasoned, thus:
proper officer. However, notwithstanding the
defect in the resolution, the court a quo held that Even as the MOTION FOR RECONSIDERATION by
the intention of petitioner Strongworld to the Plaintiff was not assailed by the other
authorize Gamolo to prosecute the case against Defendant, but due to lack of notification, this
private respondents is clear. Motion should not have been received by the Court
at all, therefore [it] is a mere scrap of paper which
On 30 April 1998, private respondent First Peoples requires no ruling.
Bank filed a Motion for Reconsideration of the 30
March 1998 Order, praying for the dismissal of the
Complaint. On 25 May 1998, petitioners belatedly Now, petitioners filed a Petition for Certiorari with
filed an Opposition thereto. the Court of Appeals, assailing the Orders of the
RTC dated 7 May 1998 and 17 July 1998. The
In the interim, on 7 May 1998, the court a quo Petition likewise sought to annul the Order of the
issued an Order, recalling its Order of 30 March RTC dated 9 January 1998, dismissing the
1998. The trial court declared that the case should Complaint, which was later revived by the Order
remain dismissed on the ground that petitioners of 7 May 1998.
Motion for Reconsideration of the Order dated 9
January 1998, dismissing the Complaint, was not The CA dismissed petitioners’ Petition for
served on private respondents Bank of Commerce, Certiorari for utilizing the wrong recourse of
Francisco and Lizarda. Moreover, the trial court certiorari, instead of an ordinary appeal.
opined that it was in error when it considered
petitioners Motion for Reconsideration, as no proof Issue
of service to private respondents was shown
therein, and the same lacked a notice of hearing, 1. Whether or not the appellate court was in
which defects rendered the aforesaid Motion for error when it dismissed petitioners’ Petition
Reconsideration, a mere scrap of paper. for Certiorari on the ground that appeal
was the appropriate remedy under Rule 41
Subsequently, petitioners apparently filed a of the 1997 Revised Rules of Civil
Motion for Reconsideration of the 7 May 1998 Procedure, and not a Petition for Certiorari,
Order, a copy of which cannot be found on the under Rule 65 thereof; or
records. On 29 May 1998, the court a quo
rendered an Order, denying the motion and finding 2. Whether or not Petition for Certiorari is the
no reason to reconsider its Order of 7 May 1998. proper remedy.

On 15 June 1998, petitioners filed a Motion for


Clarification and/or Reconsideration and for Held
Declaration of Default. They sought, inter alia, for
clarification of the Order dated 7 May 1998, YES. The appellate court erred when it ruled that
positing that the dismissal should only pertain to petitioners Petition for Certiorari filed before it was
private respondent First Peoples Bank. They also not the proper remedy. The dismissal of the
prayed that the 7 May 1998 Order be declared as Complaint being without prejudice, the remedy
superseded by the Order of 29 May 1998. In the available to the aggrieved party is Rule 65.
alternative, they prayed that the 7 May 1998
Order be reconsidered and set aside, that the The SC cited Rule 41, Sec 1 (h) of the 1997.
Complaint be reinstated, and that private Wherein no appeal may be taken from an order
dismissing an action without prejudice. In such a
case, the 1997 Revised Rules of Civil Procedure enumerated are without prejudice because they do
states that the remedy available to the aggrieved not preclude the refiling of the same action.
party is to file an appropriate special civil action
under Rule 65. Verily, the dismissal of petitioners Complaint by
the court a quo was not based on any of the
The SC distinguished a dismissal with prejudice grounds specified in Section 5, Rule 16 of the 1997
from a dismissal without prejudice. The former Revised Rules of Civil Procedure; rather, it was
disallows and bars the refiling of the complaint; grounded on what was encapsulated in Section
whereas, the same cannot be said of a dismissal 1(g), Rule 16 of the 1997 Revised Rules of Civil
without prejudice. Likewise, where the law permits, Procedure.
a dismissal with prejudice is subject to the right of
appeal. As the trial court ratiocinated in its 9 January 1998
Order, the Complaint is not prosecuted by the
In this case, the SC said, as can be gleaned proper party in interest. Considering the
therefrom, the trial courts order of dismissal of 9 heretofore discussion, we can say that the order
January 1998, was founded on the ground that the of dismissal was based on the ground that the
action was not instituted by the proper party in Complaint states no cause of action. For this
interest. The trial court held that petitioners reason, the dismissal of petitioners Complaint
Gamolo and Molo, although admittedly officers of cannot be said to be a dismissal with prejudice
petitioner Strongworld, appear to have instituted which bars the refiling of the same action.
the action for and in behalf of petitioner
Strongworld, yet, their authority to sue or defend As has been earlier quoted, Section 1(h), Rule 41
the corporation had not been shown in the of the 1997 Revised Rules of Civil Procedure
Complaint. No board resolution for the purpose mandates that no appeal may be taken from an
had been attached or recited in the Complaint. order dismissing an action without prejudice. The
same section provides that in such an instant
Jurisprudence states that if the suit is not brought where the final order is not appealable, the
in the name of, or against, the real party in aggrieved party may file an appropriate special
interest, a Motion to Dismiss may be filed on the civil action under Rule 65.
ground that the Complaint states no cause of
action. Section 1(g), Rule 16 of the 1997 Revised The appellate court erred, thus, when it
Rules of Civil Procedure allows the filing of a pronounced in its Decision of 24 May 2000 that
Motion to Dismiss on the ground that the petitioners remedy is appeal under Section 1, Rule
Complaint states no cause of action. 41 of the 1997 Revised Rules of Civil Procedure.

Further, Section 5 of the same Rule, recites the


effect of a dismissal under Sections 1(f), (h), and A Petition for Certiorari under Rule 65 is available
(i), thereof, thus: in cases when there is no appeal, nor any plain,
speedy, and adequate remedy in the ordinary
SEC. 5. Effect of dismissal. Subject to the right of course of law. In the case at bar, appeal of the 7
appeal, an order granting a motion to dismiss May 1998 Order, reviving the Order of 9 January
based on paragraphs (f), (h), and (i) of section 1 1998, which dismissed petitioners Complaint, and
hereof shall bar the refiling of the same action or as reiterated in the 17 July 1998 Order is not a
claim. remedy available to petitioners as aggrieved
parties.
Briefly stated, dismissals that are based on the
following grounds, to wit: (1) that the cause of
action is barred by a prior judgment or by the In sum, the appellate court erred when it ruled
statute of limitations; (2) that the claim or demand that petitioners Petition for Certiorari filed before
set forth in the plaintiffs pleading has been paid, it was not the proper remedy. The dismissal of the
waived, abandoned or otherwise extinguished; Complaint being without prejudice, the remedy
and (3) that the claim on which the action is available to the aggrieved party is Rule 65.
founded is unenforceable under the provisions of
the statute of frauds, bar the refiling of the same
action or claim. Logically, the nature of the
dismissal founded on any of the preceding grounds
is with prejudice because the dismissal prevents
the refiling of the same action or claim. Ergo,
dismissals based on the rest of the grounds