CAPITOL MEDICAL CENTER, INC., AND DRA. THELMA NAVARRETE CLEMENTE, PETITIONERS, VS. THE COURT OF APPEALS, HON. IGNACIO SALVADOR, IN HIS CAPACITY AS PRESIDING JUDGE OF BRANCH 77 O…

At bottom, the only issue in this case is whether a school that,
after due notice to the Secretary of Education, Culture and Sports, closed at
the end of the first semester of the school year 1987-1988, because its
teachers and students declared a strike, refusing to hold classes and take
examinations, may be forced to reopen
by the courts at the instance of the striking students.

Some fourteen (14) years
ago, the petitioner Capitol Medical Center, Inc. (or CMCI), a hospital
corporation, organized, opened, and operated the Capitol Medical Center College
(CMCC or “the College”) beside its hospital, the Capitol Medical
Center (hereafter “the Hospital”) in Quezon City. It offered a four-year nursing course, a
two-year midwifery course, and a two-year medical secretarial course. In the first semester of the school year
1987-88, 900 students were enrolled in various courses in the college.

Halfway through the first
semester in 1987, the college faculty, led by the Dean of Nursing, demanded
that they be granted vacation and sick leave privileges similar to those
enjoyed by hospital personnel. Dialogues
were held but no agreement was reached between the faculty and the school
administration, headed by the president, Dr. Thelma Navarette-Clemente,
who was concurrently also the chairman of the CMCI Board.

At a meeting of the CMCI
Board on September 15, 1987, Dr. Clemente reported the deteriorating
relationship between the CMCC administration and the teachers, which, from a
simple disagreement, had degenerated into open hostility. She feared that the situation may give rise to mass action by the
students, because the faculty, exercising their moral influence over the
students, had enlisted the latter’s sympathy and support for their
cause.

The Board resolved to
authorize her, as president of the College, to close it at the end of the first
semester if the antagonism of the faculty and students toward the college
administration should become uncontrollable. The minutes of that
meeting of the CMC Board disclose the following action taken by the Board:

“CMC College

“The chairman reported on the developing antagonism between
the Dean and a good number of the
Faculty on the one hand, and the CMC Administration on the other hand on
economic matters, more particularly the demand of the faculty for similar
vacation and sick leave privileges as hospital personnel, and that despite of
dialogs (sic), the faculty does not show any conformity to the difference. She fears that this antagonisms might later on develop into mass actions and
demonstrations, wherein students who are under the influence of the dean and
the faculty will show by concrete manifestation sympathy for the faculty
demands.

“After a thorough discussion of the possible effect of
these mass demonstrations especially if done in front of hospital premises, on
patients confined in the hospital, and the possibility of this antagonism being
manifested during the making of the rounds of patients by CMCC Nursing Students
when being conducted Related
Learning Experiences (RLE), the board unanimously approved the following
resolution:

“Res. No. 87-86 to authorize
the Chairman in his (sic)
capacity as President of CMC
College, to close the
college at the end of the first semester, should the antagonism described by
her become uncontrollable.” (p. 79, Rollo.)

During the next thirty
(30) days, the rift between the administration and the faculty aggravated. The school administration scheduled the
holding of the final semestral examinations on October 14 to 19, 1987, but the
teachers defiantly and unilaterally “postponed” them. On the scheduled dates for the examinations,
the students joined their teachers in a noisy demonstration in front of the
hospital (Annexes O, P, Q, and R, pp. 146-147, Rollo). As the demonstrations disturbed the peace
and quiet of the hospital and fearful of possible subversive action by hostile
student nurses which might endanger the safety and lives of the patients in the
hospital, an emergency special meeting was held by the CMCI Board on October
17, 1987. It unanimously resolved
“to close the school effective at the end of the first semester of this
school year, 1987-88” (p. 269, Rollo). Starting on that date, the following announcement was posted in several
places on the school premises:

“ANNOUNCEMENT

“ALL STUDENTS, PLEASE BE INFORMED OF THE TOTAL CLOSURE OF
CAPITOL MEDICAL CENTER COLLEGE AFTER THE END OF THE FIRST SEMESTER OF SCHOOL
YEAR 1987-88. PLEASE SEE POSTED LETTER
INFORMING THE DECS OF SAID DECISION, BSN I-IV, MIDWIFERY I-II AND JUNIOR
SECRETARIAL STUDENTS ARE THEREFORE ADVISED TO SEEK THEIR EVENTUAL TRANSFER TO
OTHER SCHOOLS FOR THE SECOND SEMESTER.

“HERE IS A PARTIAL LIST OF SCHOOLS WILLING TO ACCEPT STUDENTS
TRANSFEREES:

“1.  ARELLANO UNIVERSITY

“2.  DE OCAMPO COLLEGE OF NURSING

“3.  FATIMA COLLEGE OF NURSING

“4.  ST. JUDE COLLEGE OF NURSING

“5.  DE LOS SANTOS COLLEGE OF NURSING

“6   FAMILY CLINIC COLLEGE OF NURSING

CMC COLLEGE
ADMINISTRATION”

(p. 131,
Rollo.)

On October 20, 1987, Dr. Clemente
informed the Department of Education, Culture & Sports (DECS) that the
school would be permanently closed at the end of the first semester.

“CAPITOL MEDICAL CENTER, INC.

October 20, 1987

“The Honorable
Lourdes R. Quisumbing

Secretary of
Education, Culture and Sports

M a n i l a

“Through the
Regional Director

Mrs. Modesta
Boquiren

National Capital
Region

Quezon City

“Dear Madam Secretary:

“Greetings!

“Please be informed that in an
emergency special meeting of our Board of Directors held on October 17, 1987,
it was unanimously resolved to close the
Capitol Medical Center College, effective at the
end of the first semester of this school year, 1987-1988.

“The recurring problems between
our corporation on the one hand and the Dean, Faculty and student body of the
college, on the other hand, which has
resulted in the non-holding
up to now, of final examinations for the first semester of this school year,
has gotten out of hand.

“Kindly advise us of the procedure
to effect the immediate closure resolution of our board.

“Thank you.

Very truly yours,

(SGD) THELMA
NAVARRETE-CLEMENTE

M.D., M.H.A.,
Chairman of the

Board and
President”

(p. 269, Rollo;
underlining ours.)

As the DECS did not reply promptly, Dr. Clemente on October 29,
1987, sent another letter to DECS Secretary Lourdes Quisumbing reinforcing
CMCI’s resolve to “cease operation of school immediately effective
as of the end of the first semester of the current school year 1987-88.”
The letter reads as follows:

“October 29, 1987

“The Honorable
Lourdes R. Quisumbing

Secretary of
Education, Culture and Sports

M a n i l a

“Dear Madam Secretary:

“Greetings!

“This is to reinforce our earlier
letter, dated October 20, 1987, informing your honorable office of the
corporate decision of our Board of Directors to cease operation of the Capitol
Medical Center College immediately effective as of the end of the first
semester of the current school year, 1987-1988.

“The decision as embodied in the
corporate resolution contemplates in no uncertain terms the immediate and
total cessation of all education activities due to the following
cogent reasons:

“1. Mismanagement
of the school administration and mishandling of corporate policies by the Dean,
extending down to the lower administrative levels.

“2. Failure of the
school to produce the quality of education that maybe reasonably expected or
desired as evidenced by the poor quality of Instruction it gives, the deficient
program of guidance it maintains, and the poor performance of its graduates
over the past few years.

“3. The increasing costs of operation
and maintenance of school
facilities.

“4. Considering
the fact that the school is only a minor subsidiary of the hospital
corporation, its continued operation
and dependent existence will as projected, greatly impair the economic
viability of the institution and ultimately affect health care delivery and
other vital medical services of the hospital to the community and the general
public.

“For the above reasons, we feel
there are no legal impediments against the immediate and complete
closure of the school under the purview of the Corporation Code.

“Since there are quite a number of
Nursing and Midwifery Schools in the community who would be more than willing
to take in our students, we will help undertake arrangements with these schools
for their transfer, together with the assistance of your good office of course.

“Finally, we are very well aware
of the requirements of the Labor Laws concerning the faculty members and other
support personnel who are already permanent with at least three years of
service. We shall settle these in due
time under its proper forum.

“Very truly yours,

“(SGD) THELMA
NAVARRETE-CLEMENTE, M.D., M.H.A.

President

Chairman, Board of Directors”

(p. 270-271, Rollo;
emphasis supplied.)

The Department of Labor and Employment (DOLE) was likewise
notified of the termination of the services of the faculty and other support personnel
of the college “thirty days hence” as required by Article 284 of the
Labor Code (p. 272, Rollo).

It appears that on October 26, 1987, or three (3) days before Dr.
Clemente wrote her second letter, DECS Regional Director Modesta Boquiren had
written the following reply which was received later:

“October
26, 1987

“The Chairman
of the Board

and President

CAPITOL MEDICAL
CENTER COLLEGE

Sct. Magbanua Cor.
Panay Avenue

Quezon City

“Dear Madam:

“This has reference to your letter dated October 20, 1987 requesting
for a gradual phasing out of all courses effective June
1988 according to the following schedules:

“June 1988 – No 1st year

June 1989 – No 2nd year

June 1990 – No 3rd year

June 1991 – No 4th year

“This Office interposes no objection to your request
provided that the school administrators can comply with the requirements of the
Department of Labor and Employment regarding the benefits of faculty members
and support personnel who are already permanent and who have already served the
school for three or more years.

“Pursuant to regulations, after all the courses shall have
been phased out, the school cannot reopen unless the corporate status is
changed from a stock corporation to a non-stock corporation.

“Very truly
yours,

“(SGD)
Illegible

“MODESTA G. BOQUIREN

“Director”

(p. 256, Rollo;
underlining supplied.)

Evidently, Director
Boquiren failed to comprehend that Dr. Clemente did not request for permission
to “gradually phase out” the school but merely informed the
DECS of the school administration’s decision to effect the “immediate and
complete closure” of the school. As the DECS did not react to her second letter, CMCCI proceeded with the closure of the college.

The teachers, students
and their parents, a representative of the DECS and the school
administration, thereafter, held a
series of dialogues to persuade
CMCCI to open the school for one more semester or until the end of the school
year. An agreement was prepared by the
DECS but CMCCI wanted to include a
written stipulation binding the
students and their parents to hold no more strikes,
rallies, or demonstrations until the end of the school year. Since the latter did not sign the agreement,
the school did not reopen.

The college and the DECS have assisted in effecting the transfer
of some 411 students to other schools (p. 15, Rollo).

THE CASE

On December 2, 1987, fifteen (15) students and parents purporting
to represent the 900 students of the CMCC filed a class suit (Civil Case No.
52429) against “Capitol Medical Center College” and petitioner Dr.
Clemente, in the Regional Trial Court of Quezon City praying for the reopening
of the Capitol Medical Center College which had been closed effective at the
end of the first semester of the school year 1987-1988 (p. 208, Rollo).

As the complaint (Annex A) prayed for the issuance of a writ of
preliminary mandatory injunction, the court set the hearing of the application on December 9,
1987. As agreed at the hearing, an
opposition was filed by CMCC on December 14, 1987 (p. 257, Rollo).

On the same day, the lower court granted the writ of preliminary
mandatory injunction and directed the defendants “to reopen (the) school and
allow plaintiffs students to enroll in their respective course[s] x x x.” It fixed them plaintiffs’
bond in the sum of P50,000 (pp. 85 and 273, Rollo). The order reads as follows:

“Plaintiffs’ petition for the issuance of a Writ of
Preliminary Mandatory Injunction having been heard by the Court, the plaintiffs
appearing by their lawyer, Atty. Raymundo Armovit and the defendants by their
attorney, Atty. Samson Alcantara and no sufficient cause to the contrary being
shown, the Court finds that this is a proper case for injunction and the writ
prayed for should issue; WHEREFORE, the Court hereby orders that a Writ of
Preliminary Mandatory Injunction issue against the defendants directing them to
re-open school and allow plaintiffs’ students to enroll in their respective
courses of study and to perform such other acts in the tenor and under the terms
and conditions set forth in paragraph 8 in the complaint filed in this action,
upon the filing of an injunction bond in the amount of FIFTY THOUSAND PESOS (P50,000.00) within three (3) days from receipt of
this order.” (p. 84, Rollo.)

The petitioners filed a
motion for reconsideration of the above order (p. 87, Rollo) but the court
denied their motion (p. 95, Rollo).

In due time, the
petitioners elevated the order to the Court of Appeals on a petition for certiorari with preliminary injunction (CA-G.R. SP
No. 13626, p. 96, Rollo). The Court of
Appeals issued a restraining order and directed the respondents to comment on
the petition.

After hearing the parties
in oral argument, the Court of Appeals rendered a decision on February
15, 1988 holding that the respondent RTC Judge did not abuse his discretion in
issuing the order of preliminary mandatory injunction because the petitioners
had no right to suddenly close the school for the enrollment of the students
created a binding contract between them and the school
for the latter to continue operating until the former shall have finished their
courses (p. 120, Rollo).

On February 26, 1988, the petitioners filed a motion for
reconsideration and re-hearing which was held on March 3, 1988 (p. 127, Rollo).

Nevertheless, on March 8, 1988, the Court of Appeals denied
petitioner’s motion for reconsideration (p.
154, Rollo). Hence, this
petition for review.

The petition for review
has merit.

The sole object of a preliminary injunction, whether prohibitory
or mandatory, is to preserve the status quo until the merits of
the case can be heard. The status
quo is the last actual peaceable uncontested status which preceded the
controversy (Rodulfa vs. Alfonso, 76 Phil. 225). It may only be resorted to by a litigant for the preservation or
protection of his rights or interests and for no other purpose during the
pendency of the principal action (Calo vs. Roldan, 76 Phil. 445). It should only be granted if the party
asking for it is clearly entitled thereto (Climaco vs. Macaraeg, 4 SCRA 930;
Subido vs. Gopengco, 27 SCRA 455; Police Commission vs. Bello, 37 SCRA 230).

Inasmuch as a mandatory
injunction tends to do more than to maintain the status quo,
it is generally improper to issue such
an injunction prior to the final hearing (Manila Electric Railroad and Light
Co. vs. Del Rosario, 22 Phil. 433). It
may, however, issue “in cases of extreme urgency; where the right is very
clear; where considerations of relative inconvenience bear strongly in
complainant’s favor; where there is a willful and unlawful invasion of
plaintiff’s right against his protest and remonstrance, the injury being a
continuing one; and where the effect of the mandatory injunction is rather to
reestablish and maintain a preexisting continuing relation between the parties,
recently and arbitrarily interrupted by the defendant, than to establish a new
relation. Indeed, the writ should not
be denied the complainant when he makes out a clear case, free from doubt and
dispute.” (Commissioner of Customs vs. Cloribel, et al., 19 SCRA 235.)

The questions that we
might ask are:

(1)   What was the status quo before
the private respondents filed their complaint “for specific
performance” on December 2, 1987?

(2)   Do the private respondents have a clear legal
right to demand the reopening of the school?

The status quo on December 2, 1987 was that the
school was already closed. CMCC was
closed effective at the end of the first semester, i.e., the first week of
November 1987.

What was the status
quo prior to the closure of the school? There were no classes. The
school was deserted. The teachers and
students were on strike; they refused to attend classes and held noisy rallies
in front of the CMC hospital instead.

That was the status
quo before the private
respondents filed Civil Case No. 52429. The writ of preliminary mandatory injunction was issued by the trial
court not to restore that status quo, but to restore conditions preceding the status
quo, i.e., to reopen and resume
the holding of classes which the private respondents themselves (plaintiffs in
Civil Case No. 52429) by their mass actions had disrupted. In issuing the writ of preliminary
injunction for that purpose, the trial court committed a grave abuse of
discretion for it allowed the writ to be used by the plaintiffs to undo the
mischief that they themselves had initiated.

The teachers, by refusing
to teach, and the students, by refusing to attend classes, made the continued
operation of the CMCC futile and untenable. The
college had no reason to remain open under the situation which the private
respondents themselves brought about.

Did the private
respondents have a clear legal right to reopen the school and to be readmitted
therein?

The Court of Appeals
answered that question affirmatively on the theory that “the initial
enrollment” of the students (meaning their enrollment in the first year of
their chosen courses) created “a binding contract” between the students and the school, by which
the latter became “legally and morally bound to continue operating the
school until such enrollees shall have finished their courses.”

The Court of Appeals
presumably, but erroneously, relied on paragraph 137, Sec. IV of the Manual of
Regulations for Private Schools; which provides:

“Every student has the right to enroll in any school,
college or university upon meeting its specific requirements and reasonable
regulations, provided, that except in the case of academic delinquency and
violation of disciplinary regulations, the student is presumed to be qualified
for enrollment for the entire period he is expected to complete his course
without prejudice to his right to transfer.”

The meaning of this
provision is that the school, after having accepted a student for enrollment in
a given course may not expel him or refuse to re-enroll him until he completes
his course, except when he is academically deficient or has violated the rules
of discipline. He is presumed to be
qualified to study there for the entire period it will take to complete his course.

However, there is no
contract between him and the school
for the latter to remain open for the entire duration of his course. Section VII, paragraph No. 137, of the Manual of Regulations for
Private Schools provides:

“137. When a student registers in a school, it is
understood that he is enrolling for the entire school year for elementary and
secondary courses, and for the entire semester for collegiate
course. A student, who transfers or otherwise
withdraws, in writing, within two weeks after the beginning of classes and who
has already paid the pertinent tuition and other school fees in full or for any
length of time longer than one month may be charged ten per cent of the total
amount due for the term if he withdraws within the first week of classes, or
twenty per cent if within the second week of classes, regardless of whether or
not he has actually attended classes. The student may be charged all the school fees in full if he withdraws
anytime after the second week of classes. However, if the transfer or withdrawal is due to a justifiable reason,
the student shall be charged the pertinent fees only up to and including the
last month of attendance.”

The contract between the college and a
student who is enrolled and pays the fees for a semester, is for the entire semester only, not for the entire
course. The law does not require a school to see a student through
to the completion of his course. If the school closes or is closed by proper authority at the end of a semester, the student has no cause
of action for breach of contract against the school.

Thus did this Court rule in “Alcuaz, et al. vs. Philippine
School of Business Administration, Quezon City Branch, et al.,” G.R. No.
76353, promulgated on May 2, 1988, a case which involved some students and
teachers who had participated in mass actions and rallies in the respondent
school and who were respectively denied re-admission for enrollment, and re?appointment
to teaching positions in the
school:

“It is beyond dispute that a student once admitted by the
school is considered enrolled for one semester. It is provided in Paragraph 137 Manual of Regulations for Private
Schools, that when a college student registers in a school, it is understood that he is
enrolling for the entire semester. Likewise, it is provided in the Manual, that the ‘written contracts’
required for college teachers are for ‘one semester.’ It is thus evident
that after the close of the first semester, the PSBA-QC no longer has any
existing contract either with the students or with the intervening
teachers. Such being the case, the
charge of denial of due process is untenable. It is a time-honored principle that contracts are respected as the law between
the contracting parties (Henson vs. Intermediate Appellate Court, et al., G.R.
No. 72456, February 19, 1987, citing: Castro vs. Court of
Appeals, 99 SCRA 722; Escano vs. Court of Appeals, 100 SCRA 197). The contract having been terminated, there
is no more contract to speak of. The
school cannot be compelled to enter into another contract with said students
and teachers. ‘The courts, be they the
original trial court or the appellate court, have no power to make contracts
for the parties.’ (Henson vs. Intermediate Appellate Court, et al., supra.” (p. 12 of the decision.)

Significantly, in Alcuaz
only some students and teachers left their classrooms to hold rallies in
the school premises. The majority
remained in the classrooms. The school
did not cease to operate. In this case,
however, all the teachers and students struck and abandoned their
classes.

In Alcuaz, the
mass assemblies and barricades were held for three days. In the CMCC case, the “strike”
began on October 14 and continued until the end of the semester.

In Alcuaz, the
school did not close but it nevertheless refused to re-admit the offending
students and teachers. In this case,
the school has closed completely.

If in Alcuaz, this
Court recognized the right of the school to refuse admission to students guilty
of breaches of discipline, and of the peace, its right to
close when the entire faculty and student population have boycotted
their classes, may not be denied. The
irony for the school in this case is that it was forced to close by student
action, and is now being forced to reopen by student action also, assisted by
the lower court. We cannot sanction the
order of the lower court which gave aid and comfort to the students who
paralyzed the operation of the school by their mass actions forcing it to shut
down altogether. We cannot approve a
situation which would place a school at the mercy of its students.

We, therefore, hold that the lower court gravely abused its
discretion in compelling the CMCC to reopen and re-admit the striking students
for enrollment in the second
semester of their courses. Since their
contracts with the school were terminated at the end of the first semester of
1987, and as the school has already ceased to operate, they have no “clear
legal right” to re-enroll and the school has no legal obligation to reopen
and re-admit them. No provision in the
Education Act of 1982, nor in the Manual of Regulations for Private Schools can
be, or has been, cited to support the novel view that a school is obligated to remain open until its students have
completed their courses therein. Indeed, neither is there a law or rule that obligates a student who has
enrolled in a school, to remain there until he finishes his course. On the contrary he may transfer at any time to any school that is
willing to accept him.

But even if it can be supposed that the enrollment of a student
creates an implied “binding contract” with the school to educate him
for the entire course, since a contract creates reciprocal rights and
obligations, the obligation of the school to educate a student would imply a
corresponding obligation on the part of the student to study and obey the rules
and regulations of the school. When
students breach that supposed contract by refusing to attend their classes,
preferring to take to the streets to mount a noisy demonstration against
their school, the latter may cancel the contract and close its doors. Its action would neither be arbitrary nor
unfair.

It was the trial court that acted arbitrarily or with grave abuse
of discretion in ordering the school to reopen and re-admit the striking
students and teachers in spite of their refusal to desist from continuing their
disruptive mass actions against the school.

WHEREFORE, the petition for review is granted. The decision dated May 15, 1988 of the Court of Appeals in
CA-G.R. SP No. 13626 is hereby set aside. The order and writ of preliminary mandatory injunction issued by the
Regional Trial Court of Quezon City, Branch
77, in Civil Case No. Q-52429 are hereby annulled and set aside. Costs against the private respondents.

SO ORDERED.

Narvasa, (Chairman), Gancayco, and
Medialdea, JJ., concur.

Cruz, J., separate and
concurring opinion.