RICHARD TAN YU AND JOY BROS., INC., PLAINTIFFS-APPELLANTS, VS. BOARD OF DIRECTORS OF WACK WACK GOLF & COUNTRY CLUB, DIRECTOR PHILIP E. JUICO, TAN SHE LING, CARLOS G. BANIQUED, P…

Tan Yu versus Board of Directors of Wack Wack Golf and Country Club

The Case

This is the case of Tan Yu versus the Board of Directors of Wack Wack Golf and Country Club. Richard Tan Yu and Joy Brothers, Incorporated, the plaintiffs, sued the club's board of directors and several of its officers. They lost before the Regional Trial Court of Mandaluyong City, sitting in its securities jurisdiction, and they appealed to the Court of Appeals. The case matters for one narrow but examinable reason: before the appeal could be decided, the appellants changed their minds and asked to withdraw it. The Court of Appeals granted the withdrawal and treated the appeal as never pursued. The lesson is about the life and death of an appeal, and about how little discretion a court has when an appellant abandons an appeal at an early stage.

Procedural History

The plaintiffs filed their action in the Regional Trial Court of Mandaluyong City, Branch 211, docketed as a securities case. The trial court issued an order dated December 18, 2012, and it was this order that the plaintiffs appealed to the Court of Appeals in Manila. The appeal was docketed there and assigned to a division of that court.

After the required pleadings had been submitted, but before the appeal was submitted for decision, the appellants filed a Motion to Withdraw Appeal dated October 22, 2014. They attached a Corporate Secretary's Certificate dated October 17, 2014, showing that the corporation's board of directors had authorized the withdrawal. The Court of Appeals then resolved the motion, and that resolution is the ruling under study.

Facts

Richard Tan Yu and Joy Brothers, Incorporated, through their counsel, prosecuted an action against the Board of Directors of Wack Wack Golf and Country Club and individual directors and officers. The Regional Trial Court of Mandaluyong City ruled against them by order dated December 18, 2012. Aggrieved, the plaintiffs elevated the matter to the Court of Appeals.

In the Court of Appeals, the parties filed their required pleadings. Before the appeal could be submitted for decision, the appellants' board of directors met and resolved to abandon the case. The Corporate Secretary's Certificate dated October 17, 2014 recorded Resolution Number 5, which authorized Richard Tan Yu, as Vice President of the Sales Department, together with the corporation's representatives and its counsel, to withdraw the appeal. The resolution also authorized them to attest that no other such actions or proceedings were pending before the Supreme Court, the Court of Appeals, or any other court, tribunal, or agency in the Philippines.

Acting on that authority, the appellants filed a Motion to Withdraw Appeal on October 22, 2014, stating that the board had authorized the withdrawal because of a collective loss of interest in pursuing their claims against the appellees. The Court of Appeals then acted on the motion.

Issues

• Whether or not the appellants may withdraw their appeal after the required pleadings have been submitted but before the appeal is submitted for decision.
• Whether or not the Court of Appeals correctly applied the rule on withdrawal of appeals in granting the motion and deeming the appeal withdrawn.

Applicable Provisions

Section 3 of Rule 50 of the Revised Rules of Court governs the withdrawal of appeals, and it provides:

Withdrawal of appeal. - An appeal may be withdrawn as of right at any time before the filing of the appellee's brief. Thereafter, the withdrawal may be allowed in the discretion of the court.

This provision fixes the dividing line between a withdrawal that is a matter of right and one that rests on the court's discretion, and it is the sole basis on which the Court of Appeals resolved the motion.

Ruling

On the first issue, the Court of Appeals held that the withdrawal was proper. The appellants filed their Motion to Withdraw Appeal after the required pleadings had been submitted, but before the appeal was submitted for decision. On the record before it, the motion came within the period in which an appeal may be withdrawn as of right, that is, before the filing of the appellee's brief. The court therefore found the motion to be proper.

On the second issue, the Court of Appeals applied Section 3 of Rule 50 directly. It granted the motion and deemed the appeal from the order dated December 18, 2012 of the Regional Trial Court of Mandaluyong City withdrawn. Having done so, it considered the case closed and terminated. The reasoning is statutory rather than equitable: once the withdrawal is a matter of right, the court does not weigh the merits or the reasons for abandonment, and the appeal simply ceases to exist.

Doctrine

An appellant may withdraw an appeal as of right at any time before the filing of the appellee's brief. After the appellee's brief is filed, withdrawal is no longer a matter of right; it may be allowed only in the discretion of the court. When a withdrawal is timely and proper, the court grants it as a matter of course, and the appeal is deemed withdrawn, leaving the judgment or order appealed from to stand. The rule is anchored on Section 3 of Rule 50 of the Revised Rules of Court, which supplies both the cutoff and the discretionary standard that follows it.

Disposition

The Court of Appeals granted the Motion to Withdraw Appeal, deemed the appeal withdrawn, and considered the case closed and terminated.

Remember This

Memorize the line: an appeal may be withdrawn as of right before the appellee's brief is filed, and only thereafter in the court's discretion. Examiners use this case to test the cutoff point for withdrawal of appeals under Rule 50 and the effect of a withdrawn appeal on the judgment below.