VICMAR DEVELOPMENT CORP., AND/OR VICENTE L. ANGLIONGTO, PETITIONERS, VS. THE COURT OF APPEALS, THE SECURITIES & EXCHANGE COMMISSION, ALBERTO P. ATAS, AND RUFINO T. NASSER, RESPO…

This is a petition for review on certiorari contesting the
validity of the January 21, 1988
decision*
of the Court of Appeals in CA-G.R. SP No. 10756 entitled “Vicmar Development Corporation and/or Vicente L. Angliongto v. The Securities and Exchange Commission, et
al.”, which in effect affirmed the challenged orders of the Securities and
Exchange Commission**
(a) dated March 18, 1986 which recalled its order of March 5, 1986 directing
the Provincial Commander of Cagayan de Oro City to effect/implement the service of the writ of
injunction issued on September 19, 1983 and (b) dated May 13, 1986 denying
petitioner’s motion for reconsideration.

The antecedent facts as summarized by the Solicitor General are
as follows:

“1. 
Sometime in August, 1982, a conflict arose between petitioner
Vicente Angliongto and private respondent Rufino T. Nasser on the matter of exclusive control and
management of petitioner corporation.

“2.  On July 7, 1983,
petitioner Corporation by petitioner Angliongto,
filed a verified petition in the public respondent SEC against private
respondent Nasser, docketed as SEC Case No. 2490, alleging, that private
respondent Nasser was a director, Executive Vice-President and General Manager
of petitioner Corporation from
1974 to August 26, 1982 but during the annual meeting of stockholders of
petitioner corporation held on August 26, 1982,
private respondent Nasser was not re-elected as member of the Board of
Directors or to his previous management positions.  In view of the result of the annual
stockholders’ meeting, private respondent Nasser was then advised by the incoming president,
herein petitioner Angliongto that the latter would
actively manage the corporate affairs of petitioner
corporation.  In view thereof,
private respondent Nasser was asked to turn over all corporate books and
records in his possession to the duly elected officers, among others, which demand remained
(un)heeded by private respondent Nasser as the latter continued to hold office
as Executive Vice-President and General Manager of petitioner Corporation,
performing acts and entering into transactions inimical to the interests of the
petitioner Corporation and its stockholders. 
Said petition also prayed for the issuance of a restraining order and
thereafter, a permanent injunction to enjoin private respondent Nasser from
representing himself as an officer of petitioner Corporation, among other
things, and for him, to surrender all corporate books and records to the duly
elected officers of said Corporation.

“3.  On September 19,
1983, after due hearing in the aforesaid
Case No. 2490 respondent SEC,
through respondent Hearing Officer. 
Alberto Atas, issued a Writ of Preliminary Injunction, enjoining private
respondent Nasser from acting as, and/or representing himself to be, the
Executive Vice-President and/or General Manager and/or officer in any capacity
of petitioner Corporation.

“4.  Thereafter, private respondent Nasser
filed a petition for certiorari, prohibition and mandamus with
prayer for preliminary injunction and restraining order with then Intermediate
Appellate Court (now Court of Appeals), docketed as AC-G.R. SP No. 01518
praying for the nullification of the Writ of Preliminary Injunction earlier
issued by public respondent SEC as well as an earlier order temporarily
restraining private respondent Nasser from acting or representing himself to be
the Executive Vice-President and/or General Manager and/or as officer in any capacity of petitioner Corporation.

“5. 
On April 30, 1985,
the then Intermediate Appellate Court rendered its decision in AC-G.R. SP No.
01518, denying/dismissing the petition of private respondent Nasser.

“6. 
Meanwhile, sometime in November, 1983, and during the pendency of AC-G.R. SP No. 01518, in the Intermediate
Appellate Court, petitioner Angliongto and private
respondent Nasser entered into an Agreement dated November 10, 1983.  Pertinent portion of said Agreement reads:

‘Simultaneously with the delivery by
ANGLIONGTO to NASSER of all corporate
books in his possession including the
stock and transfer book, stock certificate
books, and all stock certificates of Vicmar duly indorsed in blank,
NASSER shall likewise deliver to ANGLIONGTO
the sum of FOUR MILLION TWO HUNDRED
THOUSAND (P4,200,000.00) PESOS as
part of the consideration for this settlement.  Implementation of this stipulation
shall be immediately made and completed
not later than the close of office
hours on November
10, 1983 x x x.’

“7. 
On February 10, 1986,
and after the decision in AC-G.R. SP. No. 01518 became final and executory, petitioner Corporation filed with the SEC an Ex-Parte Motion for Implementation of the Writ of Preliminary
Injunction issued on September 19,
1983.

“8. 
On March 5, 1986,
respondent Hearing Officer Atas granted the Ex-Parte Motion for Implementation of the Writ of Preliminary
Injunction, with the directive to the Provincial Commander of Cagayan de Oro City to
effect/implement the service of the order/writ of injunction dated September 19, 1983.

“9. 
On March 17, 1986, private respondent Nasser filed with public
respondent SEC a Manifestation and Motion to the effect that petitioner Angliongto, and his associates and relatives, transferred
all their shares of stock in petitioner Corporation and turned over
all their shares of stock to private respondent Nasser pursuant to and in
accordance with the Agreement dated November 10, 1983, executed between
petitioners and private respondent Nasser.

“10.  On
March 18, 1986, acting on th(e) aforesaid
Manifestation and Motion of private respondent Nasser, respondent SEC thru
Hearing Officer Atas issued an Order, recalling the
Order of March 5, 1986, which directed the Provincial Commander of Cagayan de Oro City to
effect/implement the service of the Writ of Injunction issued by the SEC on
September 19, 1983.

“11.  Petitioner
Corporation filed a Motion for Reconsideration dated March 26, 1986 which was denied by respondent
Hearing Officer Atas in an Order dated May 13, 1986.

“12.  Thereafter,
petitioner Corporation presented its evidence in support of its Opposition to
the Manifestation and Motion dated March
17, 1986, of private respondent Nasser, and on September 16, 1986, formally offered its
exhibits.

“13.  The
formal offer of exhibits of petitioner Corporation was admitted by respondent
Hearing Officer Atas in an Order dated October 9, 1986.

“14.  On December 3,
1986, Vicmar Development (petitioners) Corporation
and Angliongto filed with the then Intermediate
Appellate Court (now Court of Appeals) a Petition for Certiorari,
Prohibition and Mandamus with Prayer for Preliminary Injunction and
Temporary Restraining Order against respondents SEC and Hearing Officer Atas and private respondent Nasser, docketed as IAC-G.R.
No. 10756.  The petition was directed
against and questioned the orders of respondents SEC and Atas
dated March 18, 1986 and May 13, 1986.

“15.  On
January 21, 1988, the Court
of Appeals promulgated its decision in IAC-G.R. SP No. 10756 case, the dispositive portion of which reads:

“WHEREFORE, the petition is hereby DISMISSED.  The
temporary restraining order issued on December 9, 1986 is hereby
dissolved.  Costs
against petitioner.

“SO
ORDERED.”

(Emphasis supplied, Memorandum for the
public respondent, pp. 344-349, Rollo)

Hence, this petition.

The petition was given due course and the parties were required
to submit simultaneous memoranda in the resolution of August 21, 1989 (Ibid, p. 342).  Public respondents submitted their memorandum
on September 22, 1989 (Ibid.,
p. 344) while private respondent’s memorandum was filed on October 6, 1989 (Ibid., p. 362). 
Memorandum for petitioners was filed on October 9, 1989 (Ibid., p. 386).

The main issue in this case is whether or not the Securities and Exchange Commission has abused its discretion in recalling
its Order to enforce a writ of preliminary injunction.

The dispute between
petitioners Vicmar Development Corporation and
Vicente Angliongto on the one hand and private respondent Rufino
Nasser on the other, for the
exclusive control and management of petitioner Corporation, triggered off the filing of SEC Case No. 2490, an intracorporate
controversy over which the Securities and Exchange Commission has original and
exclusive jurisdiction under Presidential Decree No. 902-A.

In order to effectively
exercise such jurisdiction, the SEC possesses, inter alia, the power to issue preliminary or permanent
injunction, whether prohibitory or mandatory in accordance with the pertinent
provisions of the Rules of Court (Section 6-a, P.D. 902-A).

At times referred to as
the “Strong Arm of Equity”, the writ of preliminary injunction whether
prohibitory or mandatory, is sought for the protection of the rights of a party
before the final determination
of his rights vis-a-vis others’ in a pending case
before the court.  It will issue only
upon a showing that there exists
a clear and present right to be protected and that the facts upon which the
writ is to be directed are violative of said right (Roxas, Inc., et al. v. Intermediate Appellate Court, G.R.
No. 67195; Roxas, Inc. v. Gonzales, G.R. No. 78618; Roxas, Inc. v. Bautista, G.R. No. 78619-20, May 20, 1989).

The facts reveal that the
writ of preliminary injunction issued on September 19, 1983 enjoined private respondent Nasser from acting as, and/or representing
himself to be, the Executive Vice-President and/or General Manager and/or
officer in any capacity of petitioner Corporation.  Upon presentment of the Agreement dated November
10, 1983 showing a
transfer of ownership, control and management of Vicmar Corporation by Vicente Angliongto
unto Nasser, the SEC correctly recalled the
order of March 5, 1986
directing the implementation of the aforesaid writ, pending hearing on
the motion dated March 17, 1986.  To
allow execution of the writ of preliminary injunction in favor of the
petitioners despite having transferred their rights of ownership, control and
management over said corporation to respondent Nasser would be baseless, the contract having shown
prima facie that the latter is entitled to remain as
Vice-President and General Manager of petitioner Corporation.

In justifying the recall
of the order of March 5, 1986, the SEC discoursed:

“Considering the allegation of the respondent as contained
in the Manifestation and Motion dated March 17, 1986, to the effect that ‘As
early as November 10, 1983, Mr. Vicente Angliongto,
Sr. who then controlled the petitioner corporation, together with his
associates and relatives, transferred all of their shares of stock in
petitioner corporation by indorsing in blank and delivering the covering
certificates therefor, and turned over all corporate
books, to herein respondent so as to
constitute the latter as the virtual owner of all the shares in petitioner corporation’ all in pursuance to and
in accordance with the Agreement executed by the parties on November 10, 1983,
this Commission finds cogent reason to recall and rescind its order of March 5,
1986, which directed the Provincial Commander of Cagayan
de Oro City to effect/implement the service of the
writ of Injunction issued on September 19, 1983.

“In the meantime, the respondent’s Manifestation and Motion, dated March 17, 1986, is hereby set for
hearing on April 9, 1986 at 9:00 o’clock in the morning.” (Rollo, pp. 129-130).

Thus, no grave abuse of discretion can be attributed to the SEC in recalling the order to
enforce a writ of preliminary injunction in this wise.  After all, the issuance or recall of preliminary writ of injunction is an
interlocutory matter that remains at all times within the control of the court
(Alvaro v. Zapata, 118 SCRA 728 [1982]). 
The grant or denial of an injunction rests upon the sound discretion of the lower
tribunal, in the exercise of which the Supreme Court will not interfere except in a clear case of abuse (Sales v. Securities and
Exchange Commission, G.R. No. 54330, January 13, 1989).

The only question
involved in certiorari is jurisdiction, either the want or excess
thereof.  Abuse of discretion warrants
the issuance of the extraordinary remedy of certiorari only when the
same was so grave, as when the power is exercised in an arbitrary or despotic manner by reason
of passion, prejudice or
personal hostility, and it must be so patent and so gross as to amount to an
evasion of positive duty, or to a virtual refusal to perform a duty enjoined,
or to act at all, in contemplation
of law, as to be equivalent to having acted without jurisdiction (Pure Foods Corporation v. National Labor
Relations Commission, G.R. No. 78591, March 21, 1989), which finds no
application in the case at bar.

Moreover, the
determination as to who between the parties has the exclusive right of
ownership, control and management of petitioner corporation under the Agreement
of November 10, 1983 vests with the SEC, as the issue involves an intracorporate controversy which calls for the jurisdiction
of the Securities and Exchange Commission, that is, “one which arises
between the stockholder and the corporation.” “There is no
distinction, qualification, or any exemption whatsoever” (Sales v. Securities
and Exchange Commission, supra).

Noteworthy is the fact that the petitioners only filed their petition for certiorari to annul the order of March 18, 1986 on December 3, 1986, that is, after the lapse of almost nine (9) months and after having
formally offered their evidence before the SEC. 
Indeed, petitioners are estopped from
contesting said orders. 
Estoppel by laches
arises from negligence or omission to assert a right within a reasonable time (Cimfranca v. Intermediate Appellate Court, 147 SCRA 611
[1987]) and after having submitted to the jurisdiction of the tribunal (Meram v. Edralin, 154 SCRA
238 [1987]).

PREMISES CONSIDERED, the petition is hereby DENIED and the
judgment of the Court of Appeals is hereby AFFIRMED in toto.

SO ORDERED.

Melencio-Herrera, (Chairman),
Padilla, Sarmiento, and
Regalado, JJ., concur.

*
Penned by Justice Arturo B. Buena, concurred in by Justices Santiago M. Kapunan and Eduardo R. Bengzon

**
Penned by Hearing Officer Alberto P. Atas