Source: http://lawlibrary.chanrobles.com/index.php?option=com_content&view=article&id=81247:gr-173297-2013&catid=1568&Itemid=566
Timestamp: 2019-04-21 04:44:28+00:00

Document:
G.R. No. 173297 - Stronghold Insurance Company, Inc. v. Tomas Cuenca, et al.
STRONGHOLD INSURANCE COMPANY, INC., Petitioner, v.TOMAS CUENCA, MARCELINA CUENCA, MILAGROS CUENCA, BRAMIE T. TAYACTAC, and MANUEL D. MARANON, JR., Respondent.
The personality of a corporation is distinct and separate from the personalities of its stockholders. Hence, its stockholders are not themselves the real parties in interest to claim and recover compensation for the damages arising from the wrongful attachment of its assets. Only the corporation is the real party in interest for that purpose.
Under date of September 3, 1998, the Cuencas and Tayactac moved for the reconsideration of the denial of their Motion to Dismiss and to Quash Writ of Preliminary Attachment, but the RTC denied their motion for reconsideration on September 16, 1998.
WHEREFORE, the Orders herein assailed are hereby ANNULLED AND SET ASIDE, and the judgment is hereby rendered DISMISSING the Amended Complaint in Civil Case No. 98-023 of the respondent court, for lack of jurisdiction.
1. With the assistance for (sic) the counsel of Cuencas, Atty. Pulumbarit, Atty. Ayo, defendant Marcelina Cuenca, and two Court Personnel, Robertson Catorce and Danilo Abanto, went to the warehouse where Mr. Marañon recommended for safekeeping the properties in which he personally assured its safety, at No. 14, Marian II Street, East Service Road, Parañaque Metro Manila.
2. That to our surprise, said warehouse is now tenanted by a new lessee and the properties were all gone and missing.
On April 6, 2000, the Cuencas and Tayactac filed a Motion to Require Sheriff to Deliver Attached Properties and to Set Case for Hearing,17 praying that: (1) the Branch Sheriff be ordered to immediately deliver the attached properties to them; (2) Stronghold Insurance be directed to pay them the damages being sought in accordance with its undertaking under the surety bond for P1,000,0000.00; (3) Marañon be held personally liable to them considering the insufficiency of the amount of the surety bond; (4) they be paid the total of P1,721,557.20 as actual damages representing the value of the lost attached properties because they, being accountable for the properties, would be turning that amount over to Arc Cuisine, Inc.; and (5) Marañon be made to pay P200,000.00 as moral damages, P100,000.00 as exemplary damages, and P100,000.00 as attorneys fees.
Stronghold Insurance filed its answer and opposition on April 13, 2000. In turn, the Cuencas and Tayactac filed their reply on May 5, 2000.
THE LOWER COURT ERRED IN ORDERING SURETY-APPELLANT TO PAY THE AMOUNT OF P1,000,000.00 REPRESENTING THE AMOUNT OF THE BOND AND OTHER DAMAGES TO THE DEFENDANTS.
Stronghold Insurance moved for reconsideration, but the CA denied its motion for reconsideration on June 22, 2006.
A) RESPONDENT CUENCA et al., ARE NOT THE OWNERS OF THE PROPERTIES ATTACHED AND THUS, ARE NOT THE PROPER PARTIES TO CLAIM ANY PURPORTED DAMAGES ARISING THEREFROM.
B) THE PURPORTED DAMAGES BY REASON OF THE ALLEGED UNLAWFUL AND WRONGFUL ISSUANCE OF THE WRIT OF ATTACHMENT WERE CAUSED BY THE NEGLIGENCE OF THE BRANCH SHERIFF OF THE TRIAL COURT AND HIS FAILURE TO COMPLY WITH THE PROVISIONS OF THE RULES OF COURT PERTAINING TO THE ATTACHMENT OF PROPERTIES.
C) THE TRIAL COURT GRAVELY ERRED WHEN IT HELD PETITIONER STRONGHOLD TO BE SOLIDARILY LIABLE WITH RESPONDENT MARA[Ñ]ON TO RESPONDENTS CUENCA et al., FOR MORAL DAMAGES, EXEMPLARY DAMAGES, ATTORNEYS FEES AND COST OF SUIT DESPITE THE FACT THAT THE GUARANTY OF PETITIONER STRONGHOLD PURSUANT TO ITS SURETY BOND IS LIMITED ONLY TO THE AMOUNT OF P1,000,000.00.
B. Even assuming arguendo without admitting that the principle of estoppel is not applicable in this instant case, the assailed Decision and Resolution find firm basis in law considering that the writ of attachment issued and enforced against herein respondents has been declared ILLEGAL, NULL AND VOID for having been issued beyond the jurisdiction of the trial court.
C. There having been a factual and legal finding of the illegality of the issuance and consequently, the enforcement of the writ of attachment, Maranon and his surety Stronghold, consistent with the facts and the law, including the contract of suretyship they entered into, are JOINTLY AND SEVERALLY liable for the damages sustained by herein respondents by reason thereof.
D. Contrary to the allegations of Stronghold, its liability as surety under the attachment bond without which the writ of attachment shall not issue and be enforced against herein respondent if prescribed by law. In like manner, the obligations and liability on the attachment bond are also prescribed by law and not left to the discretion or will of the contracting parties to the prejudice of the persons against whom the writ was issued.
E. Contrary to the allegations of Stronghold, its liability for the damages sustained by herein respondents is both a statutory and contractual obligation and for which, it cannot escape accountability and liability in favor of the person against whom the illegal writ of attachment was issued and enforced. To allow Stronghold to delay, excuse or exempt itself from liability is unconstitutional, unlawful, and contrary to the basic tenets of equity and fair play.
Marañon insisted that he could not be personally held liable under the attachment bond because the judgment of the RTC was rendered without jurisdiction over the subject matter of the action that involved an intra-corporate controversy among the stockholders of Arc Cuisine, Inc.; and that the jurisdiction properly pertained to the SEC, where another action was already pending between the parties.
Although the question of whether the Cuencas and Tayactac could themselves recover damages arising from the wrongful attachment of the assets of Arc Cuisine, Inc. by claiming against the bond issued by Stronghold Insurance was not raised in the CA, we do not brush it aside because the actual legal interest of the parties in the subject of the litigation is a matter of substance that has jurisdictional impact, even on appeal before this Court.
The petition for review is meritorious.
Where the plaintiff is not the real party in interest, the ground for the motion to dismiss is lack of cause of action.31 The reason for this is that the courts ought not to pass upon questions not derived from any actual controversy. Truly, a person having no material interest to protect cannot invoke the jurisdiction of the court as the plaintiff in an action.32 Nor does a court acquire jurisdiction over a case where the real party in interest is not present or impleaded.
There is no dispute that the properties subject to the levy on attachment belonged to Arc Cuisine, Inc. alone, not to the Cuencas and Tayactac in their own right. They were only stockholders of Arc Cuisine, Inc., which had a personality distinct and separate from that of any or all of them.42 The damages occasioned to the properties by the levy on attachment, wrongful or not, prejudiced Arc Cuisine, Inc., not them. As such, only Arc Cuisine, Inc. had the right under the substantive law to claim and recover such damages. This right could not also be asserted by the Cuencas and Tayactac unless they did so in the name of the corporation itself. But that did not happen herein, because Arc Cuisine, Inc. was not even joined in the action either as an original party or as an intervenor.
No shall corporation shall make or declare any stock or bond dividend or any dividend whatsoever except from the surplus profits arising from its business, or divide or distribute its capital stock or property other than actual profits among its members or stockholders until after the payment of its debts and the termination of its existence by limitation or lawful dissolution.
It results that plaintiffs complaint shows no cause of action in their favor so that the lower court did not err in dismissing the complaint on that ground.
That Marañon knew that Arc Cuisine, Inc. owned the properties levied on attachment but he still excluded Arc Cuisine, Inc. from his complaint was of no consequence now. The Cuencas and Tayactac still had no right of action even if the affected properties were then under their custody at the time of the attachment, considering that their custody was only incidental to the operation of the corporation.
It is true, too, that the Cuencas and Tayactac could bring in behalf of Arc Cuisine, Inc. a proper action to recover damages resulting from the attachment. Such action would be one directly brought in the name of the corporation. Yet, that was not true here, for, instead, the Cuencas and Tayactac presented the claim in their own names.
In view of the outcome just reached, the Court deems it unnecessary to give any extensive consideration to the remaining issues.
WHEREFORE, the Court GRANTS the petition for review; and REVERSES and SETS ASIDE the decision of the Court of Appeals in CA-G.R. CV No. 79145 promulgated on January 31,2006.
1 Rollo, pp. 48-61; penned by Associate Justice Mariano C. del Castillo (now a Member of the Court), and concurred in by Associate Justice Conrado M. Vasquez, Jr. (later Presiding Justice/retired) and Associate Justice Magdangal M. de Leon.
14 Id. at 177-182; penned by Associate Justice Hector L. Hofileña (retired), and concurred in by Associate Justice Omar U. Amin (retired) and Associate Justice Presbitero J. Velasco, Jr. (now a Member of the Court).
28 Section 1, Article VIII, 1987 Constitution.
30 Rayo v. Metropolitan Bank and Trust Company, G.R. No. 165142, December 10, 2007, 539 SCRA 571, 578-579; Northeastern College Teachers and Employees Association v. Northeastern College, Inc., G.R. No. 152923, January 19, 2009, 576 SCRA 149, 174.
31 Sustiguer v. Tamayo, G.R. No. 29341, Aug. 21, 1989, 176 SCRA 579, 588-589.
32 Oco v. Limbaring, G.R. No. 161298, January 31, 2006, 481 SCRA 348, 358.
33 Ortiz v. San Miguel Corporation, G.R. Nos. 151983-84, July 31, 2008, 560 SCRA 654, 672-673.
34 Section 1, Rule 2, Rules of Court.
35 Section 2, Rule 2, Rules of Court.
36 Friedenthal, Kane & Miller, Civil Procedure, West Group, Hornbook Series, 2nd Edition, §6.3, p. 321.
38 59 Am Jur 2nd, Parties, § 35.
39 Friedenthal, Kane & Miller, op. cit., p. 320.
40 59 Am Jur 2d, Parties, § 30.
42 Section 2, Corporation Code; see Traders Royal Bank v. Court of Appeals, G.R. No. 78412, September 26, 1989, 177 SCRA 788, 792.
43 Magsaysay-Labrador v. Court of Appeals, G.R. No. 58168, December 19, 1989, 180 SCRA 266, 271-272.
44 G.R. No. 121171, December 29, 1998, 300 SCRA 579, 617.
45 86 Phil. 387 (1950).

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