THE EMBROIDERY AND APPAREL CONTROL AND INSPECTION BOARD AND THE SECRETARY OF FINANCE, PETITIONERS, VS. HON. GAUDENCIO CLORIBEL AND CECILIO RAFAEL, RESPONDENTS.

This is an original action for certiorari and prohibition with
preliminary injunction, seeking to declare null and void and to prevent the
respondent Judge from enforcing, the orders he issued in Civil Case No. 49087
of the Court of First Instance of Manila, as follows:

(a) the order, dated June 22, 1962, for the issuance of a writ of
preliminary injunction pending appeal restrain­ing herein petitioners from
enforcing the provisions of Section 2 of Republic Act 3137;

(b) the writ of preliminary injunction issued on June 27, 1962
pursuant to the order of June 22, 1962; and

(c) the order, dated June 30, 1962, denying the motion for
reconsidera­tion of the order of June 22, 1962.

By virtue of Republic Act
No. 3137, which was enacted on June 17, 1961, the Embroidery and Apparel
Control and Inspection Board (one of the petitioners herein, and one of the
respondents in the court below, hereinafter referred to as the Board) was
created and was charged with the control, issuance of entry permits, and
inspection of conditionally tax-free raw material importations by local
embroidery apparel manufacturers and the corresponding liquidation of
re-exportations thereof as Philippine-made embroideries and apparels.  Exercising the powers conferred upon it by
Republic Act 3137, on August 21, 1961, the Chairman of the Board wrote a letter
to respondent Cecilio Rafael (petitioner in the lower
court, doing business under the style “El Barato
Alce Company”), requesting him to fill the form,
attached to the letter, for li­cense application and to remit to the Board the
sum of P200.00 chargeable against his company’s future as­sessment, pursuant to
Section 4, paragraph XVI of said Republic Act 3137.  To test the constitutionality of Republic Act
No. 3137, on December 23, 1961, respondent Cecilio
Rafael filed in the Court of First Instance of Manila a petition for prohibition with preliminary in­junction (Civil Case No.
49087) against the Board, the Secretary of Finance, and the Philippine Association
of Embroidery and Apparel Exporters, Inc., praying, among others that Republic
Act 3137 be declared unconstitutional and that pending final resolution
of the petition a writ of preliminary injunction ex parte,
be issued enjoining and restraining the Board, the Secretary of Finance, and
the Philippine Association of Embroidery and Apparel Exporters from further
enforcing or implementing the provisions of Republic Act 3137.  At first the preliminary injunction prayed for
was issued by respondent Judge, in his order of January 9, 1962, but upon a
motion for reconsideration by herein petitioners said respondent Judge
dissolved the writ of preliminary injunction.

After hearing, on March 31, 1962,
a decision was rendered by respondent Judge, declaring that Sec­tion 2 of
Republic Act 3137 is unconstitutional, that the Board is illegally constituted,
and that all acts and orders done and/or issued by said Board are null and
void; and perpetually enjoining herein petitioners (respondents below) from
enforcing the provisions of Section 2 of said law.  The decision made no mention about the
preliminary injunction against the petition­ers in the event of the pendency of an appeal.

On April 24, 1962, the Solicitor General filed a notice of appeal
to the Supreme Court from the abovementioned decision of March 31, 1962,
stating in the notice that as herein petitioners (Board and the Sec­retary of
Finance) were appealing from a decision in a special civil action they did not
have to file a re­cord on appeal,
and because they were sued, and were appealing in their official capacities,
they did not have to file an appeal bond. 
On April 26, 1962, res­pondent Judge wrote “granted” on
petitioners’ notice of appeal, and on April 27, 1962 a notice was issued by the
clerk of court of the order “granting the notice of appeal filed by the
Solicitor General, dated April 24, 1962, praying that they are appealing to the
Supreme Court from the decision of this Honorable Court dated March 31, 1962, a copy of which was received on April 16,
1962.”^[1]

On April 30, 1962,
herein respondent Rafael filed two motions before the court a quo, one, for extension of time to perfect his appeal, and,
another, for clarification of the decision as to whether the same was
immediately executory it being in the nature of an injunction which is not stayed by appeal pursuant to Section 4, Rule 39 of the Rues of Court, or,
in the event that the decision
is not immediately executory, for the issuance a writ
of preliminary injunction pending appeal. 
Also on April 30, 1962, the lower court issued an order denying
respondent’s petition for extension of time to perfect his appeal, setting for
May 5, 1962 the hearing of respondent Rafael’s motion for clarification and/or
for issuance of the writ of preliminary in­junction, and holding in abeyance
the giving of due course to herein petitioners’ appeal.

Herein petitioners filed on May 7, 1962 an op­position to the
aforementioned motion for clarification and/or for the issuance of the writ of
preliminary in­junction pending appeal upon the ground that the court had no
more jurisdiction to entertain the same, much less to issue a writ of
preliminary injunction, because herein petitioners had already perfected their
appeal from the decision of the court. 
However, not withstanding petitioners’ opposition, on June 22, 1962, the
respondent Judge ordered the issuance of the writ of preliminary injunction
pending appeal, restraining herein petitioners from enforcing the provision of
Section 2 of Republic Act 3137, upon the filing by herein respondent Rafael of
a bond in the sum of P10,000.00.  On June
27, 1962.  Upon said res­pondent’s having
posted the required bond, the writ of preliminary injunction pending appeal was
issued.  Thereafter, or on June 28, 1962,
the court a quo gave due course to the appeal of both
parties.  That appeal is docketed in this
Court as G. R. No. L-19978.^[2]

On June 29, 1962, petitioners filed an urgent motion for the
reconsideration of the order of June 22, 1962 directing the issuance of the
writ of preliminary injunction, and for the dissolution of the writ of preliminary injunction
issued pursuant thereto.  On June 30,
1962, respondent Judge denied the motion for reconsideration and for the
dissolution of the writ of preliminary injunction.

On July 11, 1962, respondent Rafael filed with the court below a motion to cite the members of the
Board for contempt, alleging that the Board had been enforcing Republic Act No.
3137 by issuing release certificates to embroidery firms in spite of the writ
of preliminary injunction.  This motion for contempt was set for hearing
by counsel for respondent on July 19,
1962.

On July 19, 1962,
the Board and the Secretary of Finance, thru the Solicitor General, instituted
the present action before this Court for certiorari and prohibition, praying  (1) that the order of the respondent Judge on June 22, 1962 directing the issuance of a writ of preliminary
injunction, the writ of preliminary injunction pending appeal issued on June 27, 1962, and the order of June
30, 1962 denying the motion for reconsideration, in Civil Case No. 49087 of the Court of First Instance
of Manila, be declared null and void; (2) that a writ of prohibition be issued
prohibiting the respondent judge from enforcing the questioned orders; and (3)
that a writ of preliminary injunction be issued ex parte
restraining the respondent Judge from enforcing the order of June 22, 1962, the
writ of preliminary injunction issued pursuant to the order of June 22, 1962,
and from proceeding with the motion to cite the members of petitioner Board for
contempt.  This Court, on July 25, 1962,
gave due course to the petition and issued the writ of preliminary injunction
prayed for, without bond.

The issue to be resolved in this case is whether the respondent
Judge had jurisdiction, or had acted with abuse of discretion, when he issued
the questioned orders of June 22 and June 30, 1962 and whether the writ of
preliminary injunction issued pur­suant to the order of June 22, 1962 is valid
and be given force and effect.

We agree with petitioners’ contention that res­pondent Judge had
no jurisdiction to entertain the motion of respondent Rafael for the issuance
of the writ of preliminary injunction and to order the issuance of said writ
pending appeal.  It is shown in the
record that the petitioners received copy of the lower court’s decision of
March 31, 1962 on April 16, 1962, and on April 24, 1962, petitioners filed
their notice of appeal.  Since
petitioners were appealing from a decision rende­red in a special civil action
(prohibition) it was not necessary for them to file a record on appeal, and
since they were appealing in their official capacities they did not have to
file an appeal bond.  Hence, upon the
filing of the notice of appeal, which was “granted” by the lower
court on April 26, 1962, and a formal notice of the granting of that appeal was
issued by the Clerk of Court on April 27, 1962, petitioners’ appeal had thereby
been perfected and respondent Judge was already divested of jurisdiction to
recall the order granting the appeal,^[3]
much less to act on the motion filed thereafter by respondent
Rafael praying for the issuance of a writ of preliminary injunction pending appeal. 
The “granting” of the notice of appeal by the lower
court was not even necessary for the perfection of petition­ers’ appeal.

In the case of Alba, etc. v. Evangelista, etc., et al., (100
Phil., 683, 687-688) this Court has categorically held that appeal from the
decision of the Court of First Instance in quo warranto
proceedings is perfected by the mere presentation of the notice of appeal.^[4]
This Court held:

“As the petition for certiorari was admitted and given due course
by this Court and the writ of preliminary in­junction prayed for was issued, We
shall confine ourselves to the statement that appeal from a decision of the
Court of First Instance in quo warranto
proceedings is perfected by the mere presentation of the notice of appeal
(sections 16 and 17, Rule 41 of the Rules of Court), and from that moment ‘the
trial court loses its jurisdiction over the case, except to issue orders for
the protection and preservation of the rights of the parties which do not
involve any matter litigated by the appeal, and to approve compromises
offered by the parties prior to the transmittal of the record on appeal (which
is not required in cases of quo warranto)
to the appellate court’ (section 9, Rule 41 of the Rules of Court).  Hence, in the case at bar, the trial court
had no jurisdiction to provide for the issuance of the writ for the ad­vance
execution of its judgment, as it did by order of February 18, 1956 (Annex
E).  Consequently, We have to declare
that said order is null and void and of no force and effect and to make
permanent the writ of preliminary injunction We have issued at the instance of
the herein petitioner.’

In another case^[5],
this Court ruled:

“Since the case which would be appealed by herein petitioner
is a special civil action, being one for prohibition and mandamus, the latter
did not have to file a record on appeal (Sec. 17, Rule 41, Rules of Court), and
since the appellant would be the Solicitor General representing the
Commissioner of Immigration, there was no need for an appeal bond Rule 131,
sec. 1, Rule of Court.  Only the
notice of appeal, therefore, was neces­sary for the perfection of the appeal,
and as stated by no less than the lower court in its order of March 19, 1962,
the appeal was perfected.” (Underscoring supplied)

The respondent contends that if it be held that upon the perfection
of petitioners’ appeal the lower court had lose jurisdiction over the case an
anomalous situation would arise in that the lower court could no longer act on
his appeal even if made within the reglementary
period.  This contention has no
merit.  Respondent losses sight of the
clear provisions of the Rules of Court
as construed in the aforecited decisions of
this Court.  Under Section 9 of Rule 41 of the Rules of Court, even
after the perfection of an appeal, the Court of First Instance can still
“issue orders for the protection and pre­servation of the rights of the
parties which do not involve any
matter litigated by the appeal, * * *” The right to appeal from a decision
when availed of by a party on time – that is, within the period for appeal as
provided in the Rules of Court, is a right that should be protected by the
courts, the right to appeal being a matter that is not
litigated by the appeal.  The court,
therefore, may act and give due course to the timely appeal of one party in a
case even if the other party had
already perfected its appeal.  This is in
fact what the lower court had done in Civil Case No. 49087 when it gave due
course to herein respondent’s appeal even after the herein petitioners had
already perfected their appeal.

However, as regards the order of June 22, 1962 now in question,
which provides for the issuance of the writ of preliminary injunction after
petitioners appeal was perfected, that order could not be, and should not have
been, issued, because the preliminary injunction prayed for was aimed not to
protect or preserve the rights of the parties, or to maintain status quo of things, pending appeal, but it
precise involves the matter litigated in the appeal interpose by herein
petitioners through the Solicitor General. 
The writ of preliminary
injunction issued on June 27 1962,
pursuant to the questioned order of June 22, 1962, was actually an advance
execution of the judg­ment in Civil Case No. 49087, because the decision
appealed from by petitioners declares Section 2 of Republic Act 3137
unconstitutional, or null and void.  The
writ of preliminary injunction, in question, restrains the petitioners from
enforcing Section 2 of Republic Act 3137. 
The preliminary injunction ordered by respondent Judge after the
perfection of petitioners’ appeal, therefore, involves the matter litigated in
the appeal.

Respondent Rafael finally argues in his memorandum that while the
action he instituted in the lower court was entitled prohibition, it was in
fact an action for injunction, and so the lower court has power to issue a writ
of preliminary injunction pending appeal. 
The respondent cites as authority Sec­tion 4, Rule 39 of the Rules of
Court which provides as follows:

“SEC. 4. Injunction, receivership and accounting not stayed. – Unless otherwise ordered by the
court, a judgment in an action
for injunction or in a receivership action, or a judgment or order directing an
accounting in an action, shall not be stayed after its rendition and before an
appeal is taken or during the pendency of an
appeal.  The trial court, however, in its
discretion, when an appeal is taken from a judgment granting, dissolving or
denying an injunction, may make an order suspending, modifying, restoring or
granting such injunction during the pendency of the
appeal, upon such terms as to bond or otherwise as it may consider proper for
the security of the rights of the adverse party.”

We cannot sustain the contention of respondent Rafael.  Under Republic Act 3137 the Board exercises
both quasi-judicial and discretionary powers, in that, among others, it can
promulgate rules and regulations for the control and supervision of the
embroidery and apparel industry, exercises all the powers of control,
inspection and supervision in the issuance of licenses to import, manufacture
and/or export embroidered mate­rials, set up a system to simplify all
procedural matters for the convenience of all concerned, and do all such other
things and perform such other functions directly or indirectly that are
necessary, incidental or conducive to the attainment of the purposes and
objectives of the Act.  The Act further
provides that no other government instrumentality or agency shall be authorized
to qualify or question the validity of the license issued by the Board, and the
decisions of the Board shall be subject to appeal only to competent courts.^[6]
The petition of herein respondent Rafael in Civil Case No. 49087 in the court
below questions the jurisdiction of the board to require him to comply with
certain directives and/or regulations promulgated by said Board and to pay
certain fees chargeable against future assessments against him as provided by
law.  The petition in effect seeks to
secure a judgment declaring the Board to be without jurisdiction to act as it
had acted, and ordering the Board to desist from further acts that are not
within its jurisdiction to perform. 
Incidentally, respondent Rafael questions the constitutionality of
Republic Act 3137 in his petition.  The
petition being directed against the exercise of powers which are claimed to be
not within the jurisdiction of the Board, it is clear that the action in the
court below is one for prohibition as contemplated in Section 2, Rule 65 of the
Rules of Court.^[7]
It follows, there­fore, that the provisions of Section 4, Rule 39 of the, Rules
of Court cannot be invoked to sustain the action of the respondent Judge in
ordering the issuance of the writ of preliminary injunction after the
petitioners had perfected their appeal in
Civil Case No. 49087 in the court below.

WHEREFORE, the writ of certiorari and prohibi­tion prayed
for is granted.  The orders of respondent
Judge, dated June 22 and 30, 1962, and the writ of pre­liminary injunction
issued pursuant to the order of June 22, 1962, in Civil Case No. 49087 in the
Court of First Instance of Manila, are hereby declared null and void for having
been issued without, or in excess of, jurisdiction, and with grave abuse of
discretion.  The writ of preliminary
injunction issued by this Court in this case is declared permanent.  No pronouncement as to costs.

IT IS SO ORDERED.

Concepcion, C.J., Reyes, J.B.L., Makalintal, Bengzon, J.P., Sanchez,
and Ruiz Castro, JJ., concur.

^[1]
As quoted from the notice of the
order of the lower court.

^[2]
The case is still pending decision by
this Court

^[3] Calingo v. Tan, G. R. No. L-10336, May 31, 1957.

^[4] Quo
warranto, like prohibition, is a special civil
action.

^[5]
Commissioner of Immigration v. Romero, et al., L-19782, January 31, 1964.

^[6]
Sections 2 and 3, Republic Act 3137.

^[7]
Go Chiong v. Dinglasan,
79 Phil., 122, 124.