Ty vs Banco Filipino Savings and Mortgage Bank

G.R.
No.
June 27, 2012
Petitioner:
Nancy
Respondents: Banco Filipino Savings and Mortgage Bank

188302
L.

Ty

Facts:
Sometime in 1979, the Banco Filipino Savings and Mortgage Bank (respondent) wanted
to purchase real properties as new branch sites for its expansion program. Since the General
Banking Act limits a banks real estate holdings to no more than 50% of its capital assets, the
respondents Board of Directors decided to warehouse some of its existing properties and
branch sites to allow more flexibility in the opening of branches, and to enable it to acquire new
branch sites. The petitioner, a major stockholder and a director of the respondent, persuaded
two other major stockholders, Pedro and Tomas Aguirre, to incorporate Tala Realty Services
Corporation (Tala Realty) to hold and purchase real properties in trust for the respondent. The
petitioner, Remedios (sibling of Tomas), and Pedro controlled Tala Realty through their
respective nominees.
In implementing their trust agreement, the respondent sold to Tala Realty some of its
properties. Tala Realty simultaneously leased to the respondent the properties for 20 years,
renewable for another 20 years and with a right of repurchase should Tala Realty decides to sell
them. However, in 1992, Tala Realty repudiated the trust, claimed the titles for itself, and
demanded that the bank pay rentals, deposits and goodwill, with a threat to eject the bank.
From 1995 to 1998, Banco Filipino filed 17 complaints against Tala Realty, Nancy and
the other stockholders, including this case filed before the Malabon City RTC. The Petitioner
moved to dismiss this case on the grounds of forum shopping and litis pendencia1 citing the 16
other cases filed in other courts involving the same issues, same parties and same causes of
action. The Malabon RTC denied the motion to dismiss, finding no commonality in the 16 other
cases since they had different causes of action, as well as the motions for reconsideration and
suspension of proceedings. After filing their answers, the Petitioner moved to suspend
proceedings, citing the pendency of G.R. No. 127611, that assailed the denial of their motion to
dismiss in the Batangas City RTC, and praying for a writ of prohibition to order the 17 RTC
branches and 3 CA divisions to stop proceedings. The Malabon RTC granted the suspension of
the proceedings which the bank appealed to the CA. The certiorari was eventually granted by
the CA after the Supreme Court dismissed Gr. No. 127611 for late filing.
The bank then moved for pre-trial, to which Tala Realty again filed for a motion to
suspend proceedings due to pendency of G.R. No. 132703 stating that after the dismissal of
G.R. No. 127611, two other similar petitions have been elevated to this Court: (1) G.R. No.
130184, involving the CAs reversal of the dismissal of Civil Case No. Q-95-24830 in the
Quezon City RTC , and (2) G.R. No. 132703.The Malabon RTC granted the motion and
suspended the proceedings. After six years, the RTC issued an order directing the counsels to
inform it of the status of the pending cases.
1 litis pendentia refers to a situation where two actions are pending between the same parties for the
same cause of action, so that one of them becomes unnecessary and vexatious

Nancy filed her manifestation, informing the RTC of the Supreme Courts rulings in the
consolidated cases of G.R. Nos. 130184 and 139166, and in G.R. No. 132703, and reported on
the other cases involving the same parties decided by this Court, such as G.R. Nos. 129887,
137980, 132051, 137533, 143263, and 142672, as well as the other related cases decided by
the Supreme Court, i.e., G.R. Nos. 144700, 147997, 167255, and 144705. The bank also filed
its own manifestation with motion to revive proceedings, citing the rulings in consolidated
decision in G.R. Nos. 130184 and 139166, and the decisions in G.R. Nos. 144700, 167255, and
144705, commonly holding that there existed no forum shopping, litis pendentia and res
judicata2 among the respondents reconveyance cases pending in the other courts of justice.
In Nancys comment to the motion to revive proceedings, she held that the case should
not be revived, as it involves the same issue of implied trust which the Court in G. R No. 137533
found void for being illegal as it was a scheme to circumvent the 50% limitation on real estate
holdings under the General Banking Act.
RTC Ruling:
The RTC granted the motion to revive proceedings, citing that there is no res judicata in
this case because there are other independent causes for each of the parties to sought be
recovered. When the RTC denied the petitioners motion for reconsideration, she elevated her
case to the CA via a Rule 65 petition for certiorari, assailing the RTC orders.
CA Ruling:
The CA affirmed the RTCs orders and denied her petition for certiorari, holding that res
judicata does not apply in this case since the SC ruled in G.R. No. 144705 that G.R. No. 137533
does not put to rest all pending litigations involving the issues of ownership between the parties
since it involved only an issue of de facto possession. In this case, the trust agreement was only
raised in an ejectment case, not an issue involving ownership.
When the CA denied her motion for reconsideration, Nancy elevated her case to the
Supreme Court. According to her, the CA erred in refusing to apply G.R. No. 137533 under the
principle of res judicata by conclusiveness of judgment and stare decisis, and ignoring the 2007
resolution in G.R. No. 177865 and the 2009 consolidated decision in G.R. Nos. 130088,
131469, 155171, 155201, and 166608 that reiterated the Courts pronouncement in G.R. No.
137533.
Issues:
Whether or not the ruling of the Court of Appeals in G.R. No. 137533 applies as stare decisis3 to
the present case
Ruling:
2 a matter that has been adjudicated by a competent court and may not be pursued further by the same
parties.

3 Stare decisis simply means that for the sake of certainty, a conclusion reached in one case should be
applied to those that follow if the facts are substantially the same, even though the parties may be
different.

The Bank and Tala are in pari delicto ("in equal fault), thus, no affirmative relief should be given
to one against the other. The clean hands doctrine will not allow the creation or the use of a
juridical relation such as a trust to subvert, directly or indirectly, the law. Neither the Bank nor
Tala came to court with clean hands; neither will obtain relief from the court as the one who
seeks equity and justice must come to court with clean hands.
G.R. No. 137533, as reiterated in G.R. Nos. 130088, 131469, 155171, 155201 and
166608, is binding and applicable to the present case following the salutary doctrine of stare
decisis et non quieta movere, which means "to adhere to precedents, and not to unsettle things
which are established." Under the doctrine, when this Court has once laid down a principle of
law as applicable to a certain state of facts, it will adhere to that principle, and apply it to all
future cases, where facts are substantially the same; regardless of whether the parties and
property are the same. The doctrine of stare decisis is one of policy grounded on the necessity
for securing certainty and stability of judicial decisions.
The basic facts of the present case and those of G.R. No. 137533 and G.R. Nos.
130088, 131469, 155171, 155201 and 166608 are the same. Clearly, in light of G.R. No.
137533 and G.R. Nos. 130088, 131469, 155171, 155201 and 166608, which the Court follows
as precedents, the present action for reconveyance cannot prosper. It is the Court's duty to
apply the previous rulings in G.R. No. 137533 and in G.R. Nos. 130088, 131469, 155171,
155201 and 166608 to the present case. Once a case has been decided one way, any other
case involving exactly the same point at issue, as in the present case, should be decided in the
same manner.
Conclusion:
The petition is GRANTED. The assailed decision and resolution of the Court of Appeals
in CA-G.R. SP No. 107104 are hereby REVERSED and SET ASIDE. Civil Case No. 2506-MN
before Branch 170 of the Regional Trial Court of Malabon, Metro Manila (Malabon Case) is
hereby DISMISSED.