Insular Savings Bank vs. Far East Bank And Trust Company, G.R. No.

141818, June 22, 2006

Facts: Respondent filed a complaint against Home Bankers Trust and Company (HBTC) with the Philippine Clearing House Corporations
(PCHC) Arbitration Committee, seeking recovery from the petitioner, the sum of P25,200,000.00 representing the total amount of the three
checks drawn and debited against its clearing account. Before the termination of the arbitration proceedings, respondent filed another
complain but this time with the Regional Trial Court (RTC) for Sum of Money and Damages with Preliminary Attachment. The RTC
suspended the proceedings pending the decision of the Arbitration Committee.
The PCHC Arbitration Committee rendered its decision in favor of respondent. Petitioner motion for reconsideration was denied. It then filed
a petition for review in the earlier case filed by respondent in the RTC. The RTC dismissed the petition for review, for lack of jurisdiction.
Issue: Whether or not the petitioner availed the proper remedy contesting the decision rendered by the Arbitration Committee.
Ruling: Negative.
Petitioner had several judicial remedies available at its disposal after the Arbitration Committee denied its Motion for Reconsideration. It
may petition the proper RTC to issue an order vacating the award on the grounds provided for under Section 24 of the Arbitration Law.
Petitioner likewise has the option to file a petition for review under Rule 43 of the Rules of Court with the Court of Appeals on questions of
fact, of law, or mixed questions of fact and law. Lastly, petitioner may file a petition for certiorari under Rule 65 of the Rules of Court on the
ground that the Arbitrator Committee acted without or in excess of its jurisdiction or with grave abuse of discretion amounting to lack or
excess of jurisdiction. Since this case involves acts or omissions of a quasi-judicial agency, the petition should be filed in and cognizable
only by the Court of Appeals.

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G.R. No. 126619

December 20, 2006
UNIWIDE SALES REALTY AND RESOURCES CORPORATION, petitioner,
vs.
TITAN-IKEDA CONSTRUCTION AND DEVELOPMENT CORPORATION,
respondent.
FACTS: This case involved Titan-Ikeda who entered into 3 construction agreement/
contract /project with Uniwide. Later Titan-Ikeda filed an action for sum of money
against Uniwide with the RTC because Uniwide allegedly failed to pay certain claims
billed by Titan after the completion of the 3 projects. Uniwide moved for the
dismissal/suspension of the proceeding for them to first undergo arbitration. The
Arbitrators issued terms of reference which was signed by the parties, (Uniwide did
not attempt to modify the TOR to accommodate its belated counterclaim on
deadlines for liquidated damages.)Titan then refiled the case with CIAC.
CIAC Decision: Project 1: Uniwide is absolved of any liability. Project 2:
Uniwide is absolved of any liability for VAT payment and for the account of Titan, and
Titan is absolved from liability for defective construction. Project 3: Uniwide id held
liable for unpaid balance (5,158,364.63) plus 12% interest/annum and to pay the full
VAT for the additional work where no written authorization was presented.
CIAC likewise rejected the claim on liquidated damages.
After Uniwides motion for reconsideration was denied by CIAC, it filed a
petition for review with CA but same was denied, thus, Uniwide filed a petition for
review under rule 45 to seek partial reversal of the decision of CA which modified the
decision of CIAC. Uniwide claims that CIAC should have applied procedural rules such
as section 5, Rule 10 with more liberality because it was an administrative tribubal
free from all rigid technicalities of regular courts because CA held that the issue on
liquidated damages should be left for determination in future proceedings.
ISSUE: Whether or not CIAC should have applied the Rules of Court in the
arbitration proceeding.
RULING: Rule of Procedure Governing Construction Arbitration promulgated by the
CIAC contains no provision on the application of the Rules of Court to arbitration
proceedings, even in a suppletory capacity. Such importation of the Rules of Court
provision on amendment to conform to evidence would contravene the spirit, if not
the letter of the CIAC rules. This is for the reason that the formulation of the Terms
of Reference is done with the active participation of the parties and their counsel
themselves. The TOR is further required to be signed by all the parties, their

respective counsel and all the members of the Arbitral Tribunal. Unless the issues
thus carefully formulated in the Terms of Reference were expressly showed to be
amended, issues outside thereof may not be resolved. As already noted in the
Decision, "no attempt was ever made by the [Uniwide] to modify the TOR in order to
accommodate the issues related to its belated counterclaim" on this issue.
Arbitration has been defined as "an arrangement for taking and abiding by
the judgment of selected persons in some disputed matter, instead of carrying it to
established tribunals of justice, and is intended to avoid the formalities, the delay,
the expense and vexation of ordinary litigation.

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EXCELLENT QUALITY APPAREL, INC., vs. WIN MULTI RICH BUILDERS, INC.
Facts:
-

Petitioner Excellent Quality Apparel, Inc. then represented by Max L.F. Ying,
Vice-President for Productions, and Alfiero R. Orden, Treasurer, entered into a
contract with Multi-Rich Builders (Multi-Rich) represented by Wilson G. Chua
(Chua), its President and General Manager, for the construction of a garment
factory within the Cavite Philippine Economic Zone Authority (CPEZ).
The duration of the project was for a maximum period of five (5) months or 150
consecutive calendar days. Included in the contract is an arbitration clause.
Respondent Win Multi-Rich Builders, Inc. (Win) was incorporated with the
Securities and Exchange Commission (SEC) on 20 February 1997 with Chua as
its President and General Manager.
On 26 January 2004, Win filed a complaint for a sum of money against petitioner
and Mr. Ying amounting to P8,634,448.20.
Petitioner filed an Omnibus
Motionhttp://lawphil.net/judjuris/juri2009/feb2009/gr_175048_2009.html
- fnt14 claiming that it was neither about to close. It also denied owing anything
to Win, as it had already paid all its obligations to it.
Petitioner pointed to the presence of the Arbitration Clause and it asserted that the
case should be referred to the Construction Industry Arbitration Commission
(CIAC) pursuant to Executive Order (E.O.) No. 1008.
In the hearing held, the counsel of Win moved that its name in the case be
changed from "Win Multi-Rich Builders, Inc." to "Multi-Rich Builders, Inc."
It was only then that petitioner apparently became aware of the variance in the
name of the plaintiff.
In the Reply filed by petitioner, it moved to dismiss the case since Win was not
the contractor and neither a party to the contract, thus it cannot institute the case.
Petitioner obtained a Certificate of Non-Registration of Corporation/Partnership
from the SEC which certified that the latter did not have any records of a "MultiRich Builders, Inc."
Moreover, Win in its Rejoinder did not oppose the allegations in the Reply. Win
admitted that it was only incorporated on 20 February 1997 while the construction

contract was executed on 26 March 1996. Likewise, it admitted that at the time of
execution of the contract, Multi-Rich was a registered sole proprietorship and was
issued a business permit by the Office of the Mayor of Manila.
RTC denied the motion but was reversed by CA.
Hence, this petition.

Issues:
1. does Win have a legal personality to institute the present case;
2. does the RTC have jurisdiction over the case notwithstanding the presence of the
arbitration clause;
Held:
A suit seeking to enforce the contractual rights of a single proprietorship, that is,
collection of receivables arising from a construction agreement must be brought in the
name of the proprietor himself. Such suit cannot be brought either in the name of a
corporation organized by the proprietor in view of the separate personality of a
corporation there being no showing that the proprietor assigned the receivables to the
corporation, or even in the registered name of the single proprietorship as a sole
proprietorship is not vested with any juridical personality to file or defend an action.

---------Bache vs Ruiz

On 24 Feb 1970, Commissioner Vera of Internal Revenue, wrote a letter

addressed to J Ruiz requesting the issuance of a search warrant against
petitioners for violation of Sec 46(a) of the NIRC, in relation to all other
pertinent provisions thereof, particularly Sects 53, 72, 73, 208 and 209, and
authorizing Revenue Examiner de Leon make and file the application for
search warrant which was attached to the letter. The next day, de Leon and
his witnesses went to CFI Rizal to obtain the search warrant. At that time J
Ruiz was hearing a certain case; so, by means of a note, he instructed his
Deputy Clerk of Court to take the depositions of De Leon and Logronio.
After the session had adjourned, J Ruiz was informed that the depositions
had already been taken. The stenographer read to him her stenographic
notes; and thereafter, J Ruiz asked respondent Logronio to take the oath and
warned him that if his deposition was found to be false and without legal
basis, he could be charged for perjury. J Ruiz signed de Leons application
for search warrant and Logronios deposition. The search was subsequently
conducted.
ISSUE: Whether or not there had been a valid search warrant.

HELD: The SC ruled in favor of Bache on three grounds.

1. J Ruiz failed to personally examine the complainant and his witness.
Personal examination by the judge of the complainant and his witnesses is
necessary to enable him to determine the existence or non-existence of a
probable cause.
2. The search warrant was issued for more than one specific offense.
The search warrant in question was issued for at least four distinct offenses
under the Tax Code. As ruled in Stonehill Such is the seriousness of the
irregularities committed in connection with the disputed search warrants,
that this Court deemed it fit to amend Section 3 of Rule 122 of the former
Rules of Court that a search warrant shall not issue but upon probable cause
in connection with one specific offense. Not satisfied with this
qualification, the Court added thereto a paragraph, directing that no search
warrant shall issue for more than one specific offense.
3. The search warrant does not particularly describe the things to be seized.
The documents, papers and effects sought to be seized are described in the
Search Warrant
Unregistered and private books of accounts (ledgers, journals, columnars,
receipts and disbursements books, customers ledgers); receipts for payments
received; certificates of stocks and securities; contracts, promissory notes
and deeds of sale; telex and coded messages; business communications,
accounting and business records; checks and check stubs; records of bank
deposits and withdrawals; and records of foreign remittances, covering the
years 1966 to 1970.
The description does not meet the requirement in Art III, Sec. 1, of the
Constitution, and of Sec. 3, Rule 126 of the Revised Rules of Court, that the
warrant should particularly describe the things to be seized.
A search warrant may be said to particularly describe the things to be seized
when the description therein is as specific as the circumstances will
ordinarily allow or when the description expresses a conclusion of fact not
of law by which the warrant officer may be guided in making the search and
seizure or when the things described are limited to those which bear direct
relation to the offense for which the warrant is being issued.
-----

Ching vs Sec of Justice

FACTS:

Sept-Oct 1980: PBMI, through Ching, Senior VP of Philippine

Blooming Mills, Inc. (PBMI), applied with the Rizal Commercial
Banking Corporation (RCBC) for the issuance of commercial letters
of credit to finance its importation of assorted goods
RCBC approved the application, and irrevocable letters of
credit were issued in favor of Ching.
The goods were purchased and delivered in trust to PBMI.
Ching signed 13 trust receipts as surety, acknowledging
delivery of the goods
Under the receipts, Ching agreed to hold the goods in
trust for RCBC, with authority to sell but not by way of
conditional sale, pledge or otherwise
In case such goods were sold, to turn over the
proceeds thereof as soon as received, to apply against the
relative acceptances and payment of other indebtedness
to respondent bank.
In case the goods remained unsold within the
specified period, the goods were to be returned to RCBC
without any need of demand.
goods, manufactured products or proceeds thereof,
whether in the form of money or bills, receivables, or
accounts separate and capable of identification - RCBCs
property
When the trust receipts matured, Ching failed to return the
goods to RCBC, or to return their value amounting toP6,940,280.66
despite demands.
RCBC filed a criminal complaint for estafa against
petitioner in the Office of the City Prosecutor of Manila.
December 8, 1995: no probable cause to charge
petitioner with violating P.D. No. 115, as petitioners
liability was only civil, not criminal, having signed the
trust receipts as surety
RCBC appealed the resolution to the Department of Justice
(DOJ) via petition for review
On July 13, 1999: reversed the assailed resolution of the
City Prosecutor
execution of said receipts is enough to indict the Ching as
the official responsible for violation of P.D. No. 115

April 22, 2004: CA dismissed the petition for lack of merit and
on procedural grounds
Ching filed a petition for certiorari, prohibition and mandamus
with the CA
ISSUE: W/N Ching should be held criminally liable.
HELD: YES. DENIED for lack of merit
There is no dispute that it was the Ching executed the 13 trust
receipts.
law points to him as the official responsible for the
offense
Since a corporation CANNOT be proceeded against
criminally because it CANNOT commit crime in which
personal violence or malicious intent is required, criminal
action is limited to the corporate agents guilty of an act
amounting to a crime and never against the corporation itself
execution by Ching of receipts is enough to indict him as
the official responsible for violation of PD 115
RCBC is estopped to still contend that PD 115 covers
only goods which are ultimately destined for sale and not
goods, like those imported by PBM, for use in manufacture.
Moreover, PD 115 explicitly allows the prosecution of
corporate officers without prejudice to the civil liabilities
arising from the criminal offense thus, the civil liability
imposed on respondent in RCBC vs. Court of Appeals case is
clearly separate and distinct from his criminal liability under
PD 115
Chings being a Senior Vice-President of the Philippine
Blooming Mills does not exculpate him from any liability
The crime defined in P.D. No. 115 is malum prohibitum but is
classified as estafa under paragraph 1(b), Article 315 of the Revised
Penal Code, or estafa with abuse of confidence. It may be committed
by a corporation or other juridical entity or by natural persons.
However, the penalty for the crime is imprisonment for the periods
provided in said Article 315.
law specifically makes the officers, employees or other officers
or persons responsible for the offense, without prejudice to the civil
liabilities of such corporation and/or board of directors, officers, or
other officials or employees responsible for the offense
rationale: officers or employees are vested with the

authority and responsibility to devise means necessary to ensure

compliance with the law and, if they fail to do so, are held
criminally accountable; thus, they have a responsible share in
the violations of the law
If the crime is committed by a corporation or other juridical
entity, the directors, officers, employees or other officers thereof
responsible for the offense shall be charged and penalized for the
crime, precisely because of the nature of the crime and the penalty
therefor. A corporation cannot be arrested and imprisoned; hence,
cannot be penalized for a crime punishable by
imprisonment. However, a corporation may be charged and
prosecuted for a crime if the imposable penalty is fine. Even if the
statute prescribes both fine and imprisonment as penalty, a
corporation may be prosecuted and, if found guilty, may be fined
When a criminal statute designates an act of a corporation or a
crime and prescribes punishment therefor, it creates a criminal offense
which, otherwise, would not exist and such can be committed only by the
corporation. But when a penal statute does not expressly apply to
corporations, it does not create an offense for which a corporation may be
punished. On the other hand, if the State, by statute, defines a crime that
may be committed by a corporation but prescribes the penalty therefor to be
suffered by the officers, directors, or employees of such corporation or other
persons responsible for the offense, only such individuals will suffer such
penalty. Corporate officers or employees, through whose act, default or
omission the corporation commits a crime, are themselves individually
guilty of the crime. The principle applies whether or not the crime requires
the consciousness of wrongdoing. It applies to those corporate agents who
themselves commit the crime and to those, who, by virtue of their
managerial positions or other similar relation to the corporation, could be
deemed responsible for its commission, if by virtue of their relationship to
the corporation, they had the power to prevent the act. Benefit is not an
operative fact.
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