RICARDO L. COOTAUCO, PETITIONER, VS. THE HON. COURT OF APPEALS, HON. DOMINGO M. ANGELES, PRESIDING JUDGE OF BRANCH I, CFI, CAMARINES NORTE, AND FELIX L. LUZARRAGA, RESPONDENTS.

Cootauco versus Court of Appeals

The Case

This is a contest between two rival cockpit operators over the right to operate in the one-cockpit town of Labo, Camarines Norte, whose population does not exceed one hundred thousand residents. Ricardo Cootauco, the duly licensed operator of Gallera Lapu-Lapu, sought relief against Felix Luzarraga, the owner of the rival Gallera Plaridel whose license had been revoked, after the trial court issued a writ of preliminary injunction stopping the construction and operation of Cootauco's new cockpit. The case matters because it fixes the limits of the provisional remedy of injunction and reminds every litigant that administrative remedies must be exhausted before the courts may intervene.

Procedural History

On May 2, 1980, Luzarraga filed a complaint for specific performance, annulment of ordinance, and damages with a prayer for preliminary injunction in the Court of First Instance of Camarines Norte. On June 2, 1980, the trial court issued a temporary restraining order enjoining Cootauco from proceeding with the construction of his new cockpit and from conducting cockfights therein. On June 9, 1980, the trial court denied Cootauco's motion to lift the order and issued a writ of preliminary injunction upon Luzarraga's filing of a bond.

Cootauco then filed a petition for certiorari in the Court of Appeals, which initially enjoined the trial court from proceeding with the case. On January 12, 1981, however, the Court of Appeals denied the petition and lifted its restraining order, holding that the error, if any, of the respondent judge was an error of judgment correctible by appeal, not one made in grave abuse of discretion. Cootauco appealed to the Supreme Court, which issued a writ of preliminary injunction restraining the lower court from enforcing its orders and from taking further action in the case.

Facts

Ricardo Cootauco was a duly licensed operator of a cockpit known as Gallera Lapu-Lapu in Labo, Camarines Norte. In 1979 he built another cockpit in the new recreational zone in Barangay Bocal, where he planned to transfer Gallera Lapu-Lapu.

Felix Luzarraga owned and operated the rival Gallera Plaridel, whose license was revoked by the Municipal Mayor of Labo on September 14, 1977, on the recommendation of the Provincial Commander, because it stood inside the residential district and near public buildings and the church, in violation of the Cockfighting Law of 1974. In 1979, Raul Luzarraga, the brother of Felix, applied for a renewal permit to operate the Plaridel, but the application was denied on the ground that the Plaridel had been phased out and had ceased to operate in 1977, and that only one cockpit is allowed in a municipality with a population not exceeding one hundred thousand.

On May 2, 1980, Luzarraga sued Cootauco and others, praying for the annulment of the permit issued to Gallera Lapu-Lapu and of the municipal resolution amending the ordinance, and for a writ of preliminary injunction to stop the operation of the Lapu-Lapu and the construction of the new cockpit. The trial court granted the injunction, and the case reached the Supreme Court after the Court of Appeals refused to set it aside.

Issues

• Whether or not the Court of Appeals erred in denying the petition for certiorari and in not holding that the trial court acted with grave abuse of discretion in enjoining the operation of the petitioner's new cockpit.
• Whether or not the trial court had jurisdiction over the subject matter of the civil case for annulment of the permit and the ordinance.

Applicable Provisions

Section 3 of Rule 58 of the Rules of Court, which enumerates the grounds for a preliminary injunction, provides:

(a) That the plaintiff is entitled to the relief demanded, and the whole or part of such relief consists in restraining the commission or continuance of the acts complained of, or in the performance of an act or acts, either for a limited period or perpetually; (b) That the commission or continuance of some act complained of during the litigation or the non-performance thereof would probably work injustice to the plaintiff; or (c) That the defendant is doing, threatens, or is about to do, or is procuring or suffering to be done, some act probably in violation of the plaintiff's rights respecting the subject of the action, and tending to render the judgment ineffectual.

These grounds bear on the case because the Court measured the trial court's injunction against them and found that none was present.

Ruling

On the first issue, the Court ruled that the appeal is meritorious. A writ of preliminary injunction is a provisional remedy to which parties litigant may resort for the preservation or protection of their rights or interests, and for no other purpose, during the pendency of the principal action. The issuance of the injunction was improper for several reasons.

First, the plaintiff Luzarraga had no right that needed to be protected or preserved, because the operation of the petitioner's cockpit did not, and would not, violate any right of a person who was not operating, and had no license to operate, a cockpit. Second, the status quo at the commencement of the case was that Cootauco was duly licensed to operate and was operating Gallera Lapu-Lapu, had been authorized to transfer its location to the new recreational zone, and had constructed a new cockpit arena there which was almost completed and operational, while Luzarraga was not operating the Plaridel because his license had been cancelled in 1977, three years before the filing of the case. The injunction disturbed that status quo instead of preserving it. Third, the injunction would irreparably damage the petitioner because it would, for no lawful cause, deprive him of the use of his license to operate his cockpit, while Luzarraga would not be prejudiced by the lifting of the writ for the simple reason that he does not, for want of a license, operate a cockpit with which Cootauco's cockpit would compete.

On the second issue, the Court held that the courts have no authority to grant or cancel permits to operate cockpits duly issued by the municipal or city mayors with the approval of the Provincial Commander. Under the Cockfighting Law of 1974, the power to approve or disapprove the issuance of cockpit licenses by the city and municipal mayors was reposed in the Chief of the Philippine Constabulary. The denial by the Provincial Commander of Luzarraga's application for renewal of his cockpit license was appealable to the PC Chief, and he should have exhausted that administrative remedy. In view of his failure to do so, his judicial action was premature, and the court had no jurisdiction to intervene and grant him relief.

The Court therefore held that the civil case was filed prematurely and that the Court of First Instance of Camarines Norte did not have jurisdiction to hear and decide the case, hence all its proceedings therein are null and void.

Doctrine

A writ of preliminary injunction is a provisional remedy to which parties litigant may resort for the preservation or protection of their rights or interests, and for no other purpose, during the pendency of the principal action. It may issue only upon the grounds enumerated in Section 3 of Rule 58, and it must preserve, not disturb, the status quo at the commencement of the action.

Where the law reposes in an administrative officer the power to approve or disapprove the issuance of cockpit licenses, the courts have no authority to grant or cancel such permits, and a party who fails to exhaust the administrative remedy available to him files his judicial action prematurely, leaving the court without jurisdiction and rendering all its proceedings null and void.

Disposition

The Court set aside the appealed decision of the Court of Appeals and the orders and writ of preliminary injunction issued by the trial court, and dismissed the civil case.

Remember This

An injunction preserves the status quo and protects an existing right; it cannot be used to close a licensed operator's cockpit at the instance of one who has no license and no right to protect. Examiners use this case on the grounds and purpose of preliminary injunction under Section 3 of Rule 58, and on the exhaustion of administrative remedies before the courts may interfere with cockpit licenses.