THIRD DIVISION

[G.R. No. 153690. August 26, 2008.]

DAVID LU , petitioner, vs. PATERNO LU YM, SR., PATERNO LU
YM, JR., VICTOR LU YM, ET AL. & LUYM DEVELOPMENT CORP. ,
respondents.
[G.R. No. 157381. August 26, 2008.]
PATERNO LU YM, SR., PATERNO LU YM, JR., VICTOR LU YM,
JOHN LU YM, KELLY LU YM, and LUDO & LUYM DEVELOPMENT
CORP., petitioners, vs. DAVID LU, respondent.
[G.R. No. 170889. August 26, 2008.]
JOHN LU YM and LUDO & LUYM DEVELOPMENT CORPORATION,
petitioners, vs. THE HON. COURT OF APPEALS OF CEBU CITY
(former Twentieth Division), DAVID LU, ROSA GO, SILVANO
LUDO & CL CORPORATION, respondents.
DECISION
NACHURA, J :
p

Before us are three consolidated petitions assailing the decisions rendered and the
resolutions issued by the Court of Appeals (CA) in CA-G.R. SP No. 64523, CA-G.R. SP
No. 73383 and CA-G.R. CV No. 81163.
cCESTA

In G.R. No. 153690, David Lu (David) prays that this Court annul and set aside the
Decision 1 dated December 20, 2001 in CA-G.R. SP No. 64523 dismissing the initial
complaint led before the Regional Trial Court (RTC) of Cebu City, Branch 5 2 in
Civil Case No. CEB-25502, 3 for non-compliance with the rules on non-forum
shopping. Likewise assailed is the court's Resolution 4 dated May 28, 2002 denying
his motion for reconsideration.
I n G.R. No. 157381, Paterno Lu Ym, Sr. (Paterno Sr.), Paterno Lu Ym, Jr. (Paterno
Jr.), John Lu Ym (John), Kelly Lu Ym (Kelly) (collectively referred to as the Lu Ym
father and sons), and Ludo and Luym Development Corp. (LLDC) assail the CA
Decision 5 dated February 27, 2003 ordering the RTC to desist from conducting any
proceeding relating to the receivership over LLDC.
In G.R. No. 170889, John and LLDC question the CA Resolutions dated September
6, 2004 6 denying their application for a writ of preliminary injunction; and dated

December 8, 2005 7 denying their motion for reconsideration and further deferring
the resolution of the issue on docket fees.
Factual and Procedural Antecedents
LLDC is a family corporation founded by Paterno Sr. and his brothers (the fathers of
Rosa, Silvano and David), primarily to hold real estate for the family. 8 In 1997,
LLDC's Board of Directors authorized the issuance of its 600,000 unsubscribed and
unissued shares at par value of P100.00 per share. The Lu Ym father and sons
subscribed to and paid most of such shares. David, et al., however, claimed that the
600,000 LLDC stocks were issued in favor of the Lu Ym father and sons for less than
their real values. Hence, the complaint 9 led on August 14, 2000, by David, Rosa
Go (Rosa), Silvano Ludo (Silvano) and CL Corporation (CL Corp.) against the Lu Ym
father and sons, namely: Paterno Sr., Paterno Jr., Victor Lu Ym (Victor), John, Kelly,
and LLDC, for Declaration of Nullity of Share Issue, Receivership and Dissolution,
before the RTC of Cebu City. The case was raed to Branch 5 and was docketed as
Civil Case No. CEB-25502. In said complaint, David, et al. asked that the issuance of
said shares be nullied. 10 They further asserted that the Lu Ym father and sons
gravely abused their powers as members of LLDC's Board of Directors by issuing
such shares, to the prejudice of David, et al. They, therefore, asked for the
dissolution of the corporation as their ultimate remedy to obtain redress for their
grievances. 11 To protect the interest of the corporation during the pendency of the
case, David et al. asked that a receiver for the corporation be appointed. 12
On August 25, 2000, the Lu Ym father and sons moved to dismiss 13 the complaint
for non-compliance with the Rules of Court on the required certicate of non-forum
shopping, since only one of the four plaintis signed the same, without any showing
that he was authorized to sign on behalf of the other parties. They, likewise,
contended that the case was dismissible because they did not exert earnest eorts
toward a compromise.
In a Resolution 14 dated December 4, 2000, the court denied the motion solely on
the ground that the case was exempt from the observance of the Katarungang
Pambarangay Law . In another Resolution 15 dated March 2, 2001, the court held
that the signature of only one of the plaintis was a substantial compliance with
the rules on the certificate of non-forum shopping.
On February 16, 2001, the court, on motion of David, et al., placed LLDC under
receivership pendente lite. 16 Consequently, the court appointed Atty. Edward U. Du
and Mr. Luis A Caete as receivers. 17
Aggrieved, the Lu Ym father and sons elevated the matter to the Court of Appeals
assailing the court's resolutions denying their motion to dismiss and their motion
for reconsideration; and placing the corporation under receivership and appointing
two persons as receivers. The case was docketed as CA-G.R. SP No. 64154, but the
same was dismissed on the ground that the verication and certication against
forum shopping were signed by only two petitioners. 18 They later reled the case.
This time, it was docketed as CA-G.R. SP No. 64523.

The appellate court initially dismissed 19 the petition, nding no grave abuse of
discretion on the part of the RTC when it denied the Lu Ym father and sons' motion
to dismiss and because of the prematurity of the petition on the issue of
receivership (since there was still a motion for reconsideration pending before the
RTC). 20 However, on motion of the Lu Ym father and sons, the court reconsidered
its earlier ruling and, consequently, reinstated the earlier petition. 21 The Lu Yms
then filed a Supplement to their petition.
On December 20, 2001, the CA granted 22 the Lu Ym father and sons' petition and,
thus, dismissed the complaint led by David Lu, et al. for the parties' (except David
Lu) failure to sign the certicate of non-forum shopping. In ruling for the dismissal
of the initiatory pleading, the court applied Loquias v. Ombudsman. 23 As a
consequence of the dismissal of the complaint, the appellate court likewise annulled
the resolutions placing the corporation under receivership and appointing the
receivers. 24 On May 28, 2002, the CA denied the motion for reconsideration 25 filed
by David Lu, et al. Hence, the petition for review on certiorari before this Court led
by David Lu alone in G.R. No. 153690.
TCHcAE

Meanwhile, the Lu Ym father and sons led a Motion for Inhibition against the then
RTC Judge Ireneo Gako, Jr., which was granted on October 1, 2002. Thus, the case
was re-raed to Branch 11, presided by Judge Isaias Dicdican, who directed the
parties to amend their respective pleadings in order to conform with the
requirements laid down in Sections 4 (2) and 6 (7), Rule 2 of the Interim Rules of
Procedure Governing Intra-Corporate Controversies under Republic Act (R.A.) No.
8799. 26 The case was re-docketed as SRC Case No. 021-CEB.
On October 8, 2002, the Lu Ym father and sons led in SRC Case No. 021-CEB a
Manifestation and Motion praying for the immediate lifting of the receivership order
over LLDC which was immediately set for hearing. 27 However, the hearing did not
proceed as scheduled due to the repeated motions of David to stop it. It turned out
later that David instituted a special civil action for Certiorari and Prohibition with
the CA, with Urgent Application for Temporary Restraining Order (TRO) and Writ of
Preliminary Injunction, on the sole issue of whether or not the RTC should proceed
to hear the Lu Ym father and sons' motion to lift the receivership. The case was
docketed as CA-G.R. SP No. 73383. 28
On December 4, 2002, the CA issued a Resolution temporarily restraining the RTC
from conducting any proceeding in SRC Case No. 021-CEB. 29 On February 27,
2003, the appellate court nally resolved to grant the petition and ordered the RTC
to desist from conducting any proceeding relating to the receivership over LLDC. 30
The court concluded that the proceedings on receivership could not proceed without
the parties complying rst with the earlier court order which required the parties to
amend their pleadings. The court ratiocinated that it could not rule on the propriety
of the appointment of a receiver because it would have to base its decision on the
pleadings that were yet to be amended. Besides, the pendency of G.R. No. 153690
before this Court necessitated the deferment of any action on the lifting of
receivership.

Aggrieved, the Lu Ym father and sons instituted the instant petition in G.R. No.
157381.
Meanwhile, Judge Dicdican inhibited himself, and the case was thus transferred
from Branch 11 to Branch 12.
On March 31, 2003, David led a Motion to Admit Complaint to Conform to the
Interim Rules Governing Intra-Corporate Controversies, which the court admitted
on July 18, 2003. 31
On January 23, 2004, the Lu Ym father and sons inquired from the Clerk of Court on
the amount of docket fees paid by David, et al. John Lu Ym further inquired from the
Oce of the Court Administrator (OCA) as to the correctness of the amount paid by
David, et al. After a series of letters sent to the OCA, the latter informed John that
the matter of docket fees should be brought to the attention of the regular courts
and not to the OCA which was not in the position to give an opinion. 32
On March 1, 2004, the RTC rendered a decision 33 on the merits of the case,
annulling the issuance of LLDC's 600,000 shares of stocks thereby divesting the Lu
Ym father and sons of their shares and canceling their certicates of stocks. The
court further ordered the dissolution of LLDC and the liquidation of its assets.
Consequently, a management committee was created to take over LLDC, and the
corporation's ocers were stripped of their powers as such. 34 The court further
declared that the decision was "immediately executory". Aggrieved, the Lu Ym
father and sons seasonably led a Notice of Appeal. The case was docketed as CAG.R. CV No. 81163.

In view of the court's declaration of the executory nature of the assailed decision,
the Lu Ym father and sons applied for a Writ of Preliminary Injunction and/or
Temporary Restraining Order (TRO), 35 which was opposed 36 by David.
On January 28, 2004, the appellate court issued a TRO valid for a period of sixty
(60) days. 37 However, in a Resolution 38 dated September 6, 2004, the court
denied the application for a writ of preliminary injunction. Since the original records
had been transmitted to the appellate court, the RTC was divested of jurisdiction to
resolve pending incidents therein. Thus, it ordered that all motions be led with the
CA.
In their motion for reconsideration, 39 the Lu Ym father and sons assailed the denial
of their application for preliminary injunction and, in addition thereto, they
questioned the suciency of the docket fees paid by David, et al. in the RTC where
the original complaint was filed.
On December 8, 2005, the appellate court did not reconsider its earlier resolution.
As to the suciency of the docket fees, it ruled that the matter be raised in their
appellants' brief and that the issue be threshed out in the appeal on the merits. 40
Hence, this special civil action for certiorari and prohibition in G.R. No. 170889.

The Issues
G.R. No. 153690
David Lu raises the following issues for resolution.
[a]
WHETHER OR NOT THE COURT OF APPEALS GRAVELY ERRED IN
DISREGARDING THE NUMEROUS FATAL DEFECTS AND RULES OF COURT
AND IRCA VIOLATIONS OF RESPONDENTS' APRIL 30, 2001 PETITION,
MOTION AND SUPPLEMENT.
aCATSI

[b]
WHETHER OR NOT THE COURT OF APPEALS GRAVELY ERRED IN
DISMISSING THE RTC CASE IN ITS ENTIRETY AND IN REFUSING TO PERMIT
IT TO PROCEED AS TO PETITIONER DESPITE [I] PETITIONER'S EXECUTION
OF A CERTIFICATION AGAINST FORUM SHOPPING FOR THE COMPLAINT
AND [II] THE FACT [THAT] THE RTC CASE INVOLVES ONLY A PERMISSIVE
JOINDER OF PARTIES. 41

On August 19, 2003, the Lu Ym father and sons led an Urgent Motion with Prayer
for a TRO and/or Writ of Preliminary Injunction 42 before this Court questioning the
RTC's admission of David Lu's amended complaint. They sought to enjoin said
admission as it would render moot and academic the cases pending before this
Court.
G.R. No. 157381
The Lu Ym father and sons base their petition on the following alleged errors:
I.
THE JUDGMENT OF THE COURT OF APPEALS IS NULL AND VOID ON ITS
FACE FOR LACK OF JURISDICTION IN ENJOINING THE TRIAL COURT
BECAUSE THE DISMISSAL OF THE CASE BELOW IS ALREADY PENDING
APPEAL WITH THIS HONORABLE COURT AND IT IS, THEREFORE, THIS
HONORABLE COURT THAT HAS EXCLUSIVE JURISDICTION OVER THE
REMEDIES OF CERTIORARI, PROHIBITION AND INJUNCTION GRANTED BY
THE COURT OF APPEALS.
II.
THE PETITION FOR CERTIORARI AND PROHIBITION WAS WRONGFULLY
GRANTED BY THE COURT OF APPEALS BECAUSE ITS DECISION DID NOT
CONTAIN THE BASIC FINDING THAT THE TRIAL COURT COMMITTED A
GRAVE ABUSE OF DISCRETION TANTAMOUNT TO LACK OR EXCESS OF
JURISDICTION, NOR DID IT EVEN DEFINE IT AS AN ISSUE IN THE CASE, NOR
WAS THERE ANY GRAVE ABUSE OF DISCRETION.
III.
EVEN ASSUMING IN GRATIA ARGUMENTI THAT THE COURT OF APPEALS
HAD JURISDICTION OVER THE CASE, IT HAD ABSOLUTELY NO LEGAL BASIS
IN ENJOINING THE TRIAL COURT FROM ACTING ON THE URGENT MOTION

OF THE PETITIONERS TO LIFT THE HIGHLY OPPRESSIVE ORDER OF

RECEIVERSHIP. 43

On June 7, 2006, David led a Manifestation 44 that the cases pending before this
Court are moot and academic G.R. No. 153690 for the admission of the amended
complaint which superseded the original complaint; and G.R. No. 157381 for the
RTC's act of resolving the case on the merits. 45 For their part, the Lu Ym father and
sons agree on the mootness of G.R. No. 153690, but not G.R. No. 157381. This is
without prejudice to the resolution of the issue they raised on the propriety of the
admission of the amended complaint. 46
G.R. No. 170889
In coming before this Court in this special civil action for certiorari and prohibition,
John Lu Ym and LLDC raise the following issues:
I.
WHETHER OR NOT THE RESPONDENT COURT OF APPEALS COMMITTED
GRAVE ABUSE OF DISCRETION IN DENYING PETITIONERS' MOTION FOR
RECONSIDERATION DESPITE THE FACT THAT THE TRIAL COURT DID NOT
ACQUIRE JURISDICTION OVER THE SUBJECT MATTER OF THE CASE FOR
FAILURE OF THE RESPONDENTS TO PAY THE CORRECT DOCKET FEES
WHEN THE ORIGINAL COMPLAINT WAS FILED.
II.
WHETHER OR NOT THE RESPONDENT COURT OF APPEALS COMMITTED
GRAVE ABUSE OF DISCRETION IN NOT DISMISSING SRC CASE NO. 021-CEB
DESPITE CLEAR SHOWING THAT RESPONDENTS WERE GUILTY OF BAD
FAITH IN AVOIDING PAYMENT OF THE CORRECT DOCKET FEES. 47

On January 23, 2006, we issued a Status Quo Order specically enjoining the
implementation of the CA resolutions denying the application for a writ of
preliminary injunction. 48
CIcTAE

Stripped of the non-essentials and combining all the arguments set forth in the
consolidated petitions, the issues for our resolution are as follows:
I.

II.

Whether the original complaint led before the RTC should have been
dismissed for:
A.

non-compliance with the rules on certicate of non-forum

shopping; and

B.

non-payment of the correct docket fees

Whether the receivership proceedings were validly suspended

pending the amendment of the initial complaint in compliance with the
Interim Rules of Procedure for Intra-Corporate Controversies.

III.

Whether a writ of preliminary injunction should have been issued

pending the resolution of the appeal on the merits led before the
Court of Appeals.

The Ruling of This Court

In G.R. No. 153690, David claims that the Lu Ym father and sons' petition (in CAG.R. SP No. 64523) before the CA should not have been entertained because of the
following fatal defects: 1) the petition questioning the approval of the receivership
was prematurely led because of the pendency of their motion for reconsideration
before the RTC; 2) their motion and supplement were led without asking leave of
court to do so; 3) considering that the motion and supplement contained new
allegations, there was a failure to attach a new certicate of non-forum shopping;
and 4) the motion and supplement were filed out of time. 49
At the outset, we nd the procedural issues raised by David to be of no moment.
Basic is the rule that a motion for the reconsideration of an assailed order may be
led by an aggrieved party within the reglementary period. No motion for leave to
le such motion is required under the Rules or in any other circular of the Supreme
Court. As long as the same is led within fteen (15) days from receipt of the
assailed order, there is no reason for the courts not to entertain it. In fact, in some
exceptional cases as when substantial justice so requires, a motion belatedly led
may still be taken cognizance of. As to the supplemental petition led without leave
of court, suce it to state that the CA entertained the same, required David to
comment thereon, and decided the case on the basis thereof. Such actions of the
appellate court adequately show that the supplemental petition was admitted.
Lastly, as to the lack of certicate of non-forum shopping in the motion for
reconsideration and supplement to the petition, we need only reiterate that the
certificate is required only in cases of initiatory pleadings. 50
Now on the substantial issues.
In G.R. No. 153690, the assailed CA decision dismissed David et al.'s original
complaint for their failure to sign the verication and certication of non-forum
shopping. Subsequent to the aforesaid decision, however, the RTC ordered David et
al. to amend the complaint to conform to the interim rules of procedure for intracorporate controversy. In compliance with the order, David, et al. amended the
complaint and led the same with leave of court. The RTC, thereafter, admitted the
amended complaint, proceeded to hear the case, and decided the same on the
merits.
While it is true that the Lu Ym father and sons questioned the admission of the
aforesaid amended complaint before this Court, the same was done only through an
Urgent Motion. 51 Under the Rules of Court, the proper mode to challenge such an
order, which undoubtedly is interlocutory, is through a special civil action for
certiorari under Rule 65. This procedural defect, therefore, bars the Court from
ruling on the propriety of such admission. We cannot take cognizance of proceedings
before the RTC unless they are brought before us through the proper mode of
review. To be sure, the Urgent Motion cannot be a substitute for the remedy of a

special civil action for certiorari.

by the RTC stands.

52

Consequently, the amended complaint admitted

With the issue of admission of the amended complaint resolved, the question of
whether or not the original complaint should have been dismissed was mooted.
Section 8, Rule 10 of the Rules of Court specically provides that an amended
pleading supersedes the pleading that it amends. In this case, the original
complaint was deemed withdrawn from the records upon the admission of the
amended complaint. 53 This conclusion becomes even more pronounced in that the
RTC already rendered a decision on the merits of the said amended complaint, not
to mention the Lu Ym father and sons' concurrence in the mootness of the issue in
the instant petition. 54
It is settled that courts do not entertain a moot question. An issue becomes moot
and academic when it ceases to present a justiciable controversy, so that a
declaration on the issue would be of no practical use or value. 55 This Court,
therefore, abstains from expressing its opinion in a case where no legal relief is
needed or called for. 56
In G.R. No. 157381, the Lu Ym father and sons insist that the CA had no jurisdiction
to issue the writ of preliminary injunction, more so, to make the same permanent,
in view of the pendency of G.R. No. 153690. They argue that the application for a
writ should have been led before this Court and not through a separate special civil
action before the CA. They further assert that the CA should not have issued a writ
as there was no nding of grave abuse of discretion, to begin with. Lastly, they
argue that the order of the trial court requiring the parties to amend their pleadings
did not bar the RTC from acting on the provisional remedy of receivership. Since this
Court did not issue a restraining order, the receivership proceedings could still
proceed. 57
acEHSI

It is noteworthy at this point to reiterate the factual circumstances surrounding the

instant petition. G.R. No. 157381 has its origin in the Lu Ym father and sons' motion
to lift the receivership over LLDC. David, for his part, went up to the CA and asked
that the RTC be enjoined from hearing said motion pending resolution of his
petition before this Court in G.R. No. 153690 and the amendment of his complaint
as ordered by the RTC. David's petition was granted by the appellate court in the
assailed decision. It ratiocinated that any matter, principal or collateral, should be
held in abeyance pending the amendment of the original complaint. Besides, said
the appellate court, the dismissal of the original complaint on which the Lu Ym
father and sons based their motion to lift receivership was still the subject of an
appeal before this Court.
Again, the propriety of such injunction is mooted by the amendment of the
complaint, and the RTC decision in the case on the merits thereof. The appellate
court ordered that the hearing on the motion to lift the receivership be held in
abeyance primarily because the original complaint was yet to be amended. Upon
the amendment of the complaint and the admission thereof by the RTC, the reason

for such injunction ceased to exist. Thus, the CA could resolve, as it in fact resolved,
the question of whether or not the receivership should be lifted.
The RTC decision on the merits of the case gives this Court more reasons to declare
the mootness of the instant petition. It must be recalled that the motion to lift the
receivership was led before the RTC ancillary to the principal action, and what was
sought to be enjoined was the hearing on that particular motion. With the decision
on the merits rendered by the RTC, albeit still on appeal, there is nothing more to
be enjoined. More importantly, the RTC ordered that the receivers cease from
performing their functions and that a management committee be created. 58
Clearly, these supervening events mooted the petition. Time and again, we have
declared that a petition should be denied for the sole reason that the act sought to
be enjoined is already fait accompli. 59
To reiterate, the trial court's decision on the merits rendered the issue on the
propriety of the injunction moot and academic, notwithstanding the fact that said
decision has been appealed to the Court of Appeals. 60 Courts are called upon to
resolve actual cases and controversies, not to render advisory opinions. 61
It is true that we have held in a number of cases that the moot and academic
principle is not a magical formula that can automatically dissuade the courts from
resolving a case. Courts will still decide cases otherwise, moot and academic if: rst,
there is a grave violation of the Constitution; second, the exceptional character of
the situation and the paramount public interest is involved; third, when the
constitutional issue raised requires formulation of controlling principles to guide the
bench, the bar, and the public; and, fourth, the case is capable of repetition yet
evading review. 62 However, not one of the enumerated exceptions obtains in the
instant case. Thus, a denial of the instant petition is warranted.
EISCaD

In G.R. No. 170889, John Lu Ym and LLDC explain that while it may be possible to
raise the issue of docket fees in their appellants' brief as suggested by the CA, it
would already be too late because the issue would be rendered moot and academic
by the dissolution of the corporation. They further question the propriety of the
creation of the management committee, arguing that there was non-observance of
substantive and procedural rules. As to the issue of estoppel, they claim that they
rst raised the issue of docket fees only in their motion for reconsideration before
the CA because they had yet to await the OCA's response to their inquiry on the
correct docket fees. Lastly, they argue that David et al. are now precluded from
paying the correct docket fees by the lapse of the prescriptive period. Neither can a
lien be created on the judgment in lieu of dismissal. 63
In short, John and LLDC seek the dismissal of the initial complaint on the ground of
lack of jurisdiction occasioned by the insufficient payment of docket fees.
A court acquires jurisdiction over a case only upon the payment of the prescribed
fees. The importance of ling fees cannot be gainsaid for these are intended to take
care of court expenses in the handling of cases in terms of costs of supplies, use of
equipment, salaries and fringe benets of personnel, and others, computed as to
man-hours used in the handling of each case. Hence, the non-payment or

insucient payment of docket fees can entail tremendous losses to the government
in general and to the judiciary in particular. 64
In the instant case, however, we cannot grant the dismissal prayed for because of
the following reasons: First, the case instituted before the RTC is one incapable of
pecuniary estimation. Hence, the correct docket fees were paid. Second, John and
LLDC are estopped from questioning the jurisdiction of the trial court because of
their active participation in the proceedings below, and because the issue of
payment of insucient docket fees had been belatedly raised before the Court of
Appeals, i.e., only in their motion for reconsideration. Lastly, assuming that the
docket fees paid were truly inadequate, the mistake was committed by the Clerk of
Court who assessed the same and not imputable to David; and as to the deciency,
if any, the same may instead be considered a lien on the judgment that may
thereafter be rendered.
The Court had, in the past, laid down the test in determining whether the subject
matter of an action is incapable of pecuniary estimation by ascertaining the nature
of the principal action or remedy sought. If the action is primarily for recovery of a
sum of money, the claim is considered capable of pecuniary estimation. However,
where the basic issue is something other than the right to recover a sum of money,
the money claim being only incidental to or merely a consequence of, the principal
relief sought, the action is incapable of pecuniary estimation. 65
In the current controversy, the main purpose of the complaint led before the RTC
was the annulment of the issuance of the 600,000 LLDC shares of stocks because
they had been allegedly issued for less than their par value. Thus, David sought the
dissolution of the corporation and the appointment of receivers/management
committee. 66 To be sure, the annulment of the shares, the dissolution of the
corporation and the appointment of receivers/management committee are actions
which do not consist in the recovery of a sum of money. If, in the end, a sum of
money or real property would be recovered, it would simply be the consequence of
such principal action. Therefore, the case before the RTC was incapable of
pecuniary estimation. Accordingly, John's and LLDC's contention cannot be
sustained. And since David paid the docket fees for an action the subject of which
was incapable of pecuniary estimation, as computed by the Clerk of Court, the trial
court validly acquired jurisdiction over the case.
Even assuming that the subject in the instant case is capable of pecuniary
estimation, still, the case should not be dismissed because the insuciency of the
fees actually paid was belatedly raised; David relied on the assessment made by the
Clerk of Court; and if there is a deciency, it may instead be considered a lien on the
judgment that may hereafter be rendered.
We note that the Lu Ym father and sons belatedly raised the issue of insucient
payment of docket fees in their motion for reconsideration before the CA. A perusal
of the records reveals that the Lu Ym father and sons led several pleadings before
the RTC, specically, a Motion to Dismiss and Motion to Lift the Appointment of a
Receiver, among others. They, likewise, led several pleadings before the Court of

Appeals and before this Court either as initiatory pleadings or in opposition to those
led by the adverse party. Considering their prompt action and reaction to ensure
that their rights are protected, their belated objection to the payment of docket fees
is, therefore, inexcusable. Well-established is the rule that after vigorously
participating in all stages of the case before the trial court and even invoking the
trial court's authority in order to ask for armative relief, John and LLDC are barred
by estoppel from challenging the trial court's jurisdiction. 67 If a party invokes the
jurisdiction of a court, he cannot thereafter challenge the court's jurisdiction in the
same case. To rule otherwise would amount to speculating on the fortune of
litigation, which is against the policy of the Court. 68 Thus, even if, indeed, the
docket fees paid were inadequate, this allegation having been raised for the rst
time on appeal, should be disallowed. 69
While it is true that this Court had previously dismissed complaints for nonpayment of docket fees, as in the early case of Manchester Development
Corporation v. Court of Appeals, 70 these cases uniformly involved bad faith on the
part of the plainti, such that the correct amount of damages claimed was not
specically stated. The Court, in such cases, concluded that there was bad faith on
the part of the complainant and a clear intent to avoid payment of the required
docket fee, thus, the dismissal of the cases was warranted.
TCDHIc

It may be recalled that despite the payment of insucient fees, this Court refrained
from dismissing the complaint/petition in Intercontinental Broadcasting Corporation
(IBC-13) v. Alonzo-Legasto, 71 Yambao v. Court of Appeals 72 and Ayala Land, Inc. v.
Carpo. 73 In those cases, the inadequate payment was caused by the erroneous
assessment made by the Clerk of Court. In Intercontinental, 74 we declared that the
payment of the docket fees, as assessed, negates any imputation of bad faith to the
respondent or any intent of the latter to defraud the government. Thus, when
insucient ling fees were initially paid by the respondent, and there was no
intention to defraud the government, the Manchester rule does not apply. In
Yambao, 75 this Court concluded that petitioners cannot be faulted for their failure
to pay the required docket fees for, given the prevailing circumstances, such failure
was clearly not a dilatory tactic or intended to circumvent the Rules of Court. In
Ayala Land, 76 the Court held that despite the jurisdictional nature of the rule on
payment of docket fees, the appellate court still has the discretion to relax the rule
in meritorious cases.

In the instant case, David paid the docket fees as assessed by the Clerk of Court.
Even if the amount was insucient, as claimed by John and LLDC, fraud and bad
faith cannot be attributed to David to warrant the dismissal of his complaint.
Consistent with the principle of liberality in the interpretation of the Rules, in the
interest of substantial justice, this Court had repeatedly refrained from dismissing
the case on that ground alone. Instead, it considered the deciency in the payment
of the docket fees as a lien on the judgment which must be remitted to the Clerk of
Court of the court a quo upon the execution of the judgment. 77

Lastly, we now resolve the issue of whether or not the CA abused its discretion in
denying the Lu Ym father and sons' application for a writ of preliminary injunction.
Section 3, Rule 58 of the Rules of Court sets forth the requisites for the issuance of
a writ of preliminary injunction, thus:
(a)

That the applicant is entitled to the relief demanded, and the whole or
part of such relief consists in restraining the commission or
continuance of the act or acts complained of, or in requiring the
performance of an act or acts, either for a limited period or
perpetually;

(b)

That the commission, continuance or non-performance of the act or

acts complained of during the litigation would probably work injustice
to the applicant; or

(c)

That a party, court, agency or a person is doing, threatening, or is

attempting to do, or is procuring or suering to be done, some act or
acts probably in violation of the rights of the applicant respecting the
subject of the action or proceeding, and tending to render the
judgment ineffectual.

In the instant case, John and LLDC failed to satisfy the above requisites. Except for
their claim of nullity of the RTC decision because of insucient payment of docket
fees, no evidence was oered to establish the existence of a clear and unmistakable
right on their part that must be protected, as well as the serious damage or
irreparable loss that they would suffer if the writ is not granted.
It has been consistently held that there is no power, the exercise of which is more
delicate, which requires greater caution, deliberation and sound discretion, or more
dangerous in a doubtful case than the issuance of an injunction. It is the strong arm
of equity that should never be extended unless to cases of great injury, where
courts of law cannot aord an adequate or commensurate remedy in damages.
Every court should remember that an injunction is a limitation upon the freedom of
action of the defendant and should not be granted lightly or precipitately. It should
be granted only when the court is fully satised that the law permits it and the
emergency demands it. 78
Clearly then, no grave abuse of discretion can be attributed to the Court of Appeals
in denying the Lu Ym father and sons' application for a writ of preliminary
injunction.
One nal note. We observe that these consolidated cases involve interlocutory
orders of the RTC. The delay in the disposition of the main case, which is now
pending appeal before the CA, was occasioned by the actions of all the contending
parties in seeking armative relief before the Court of Appeals and before this
Court. Our disposition of these three petitions should now pave the way for the nal
resolution of the corporate dispute which started as early as 2000.
In view of the above disquisitions, we deem it proper to lift the status quo order
which this Court issued on January 23, 2006. The CA is directed to proceed to rule

on the appeal with dispatch.

WHEREFORE, premises considered, the petitions in G.R. Nos. 153690 and 157381
are DENIED for being moot and academic; while the petition in G.R. No. 170889 is
DISMISSED for lack of merit. Consequently, the Status Quo Order dated January 23,
2006 is hereby LIFTED.
AEaSTC

The Court of Appeals is DIRECTED to proceed with CA-G.R. CV No. 81163 and to
resolve the same with dispatch.
SO ORDERED.

Ynares-Santiago, Carpio-Morales, * Chico-Nazario and Reyes, JJ., concur.

Footnotes
1.

Penned by Associate Justice Romeo A. Brawner, with Associate Justices Elvi John
S. Asuncion and Juan Q. Enriquez, Jr., concurring, rollo, (G.R. No. 153690) pp. 6978.
cHaICD

2.

It was later re-raffled to Branch 11.

3.

Pursuant to the Interim Rules of Procedure Governing Intra-Corporate

Controversies under R.A. 8799, the case was re-docketed as SRC Case No. 021CEB.

4.

Rollo (G.R. No. 153690), pp. 80-86.

5.

Penned by Associate Justice Eubolo G. Verzola, with Associate Justices Sergio L.

Pestao and Amelita G. Tolentino, concurring; rollo (G.R. No. 157381), pp. 313319.

6.

Penned by Associate Justice Arsenio J. Magpale, with Associate Justices Vicente L.

Yap and Ramon M. Bato, Jr., concurring; rollo (G.R. No. 170889), pp. 72-73.

7.

Rollo (G.R. No. 170889), pp. 76-78.

8.

Rollo (G.R. No. 153690), p. 96.

9.

Id. at. 95-102.

10.

Id. at 97.

11.

Id. at 99.

12.

Id. at 101.

13.

Id. at 103-108.

14.

Id. at 109-110.

15.

Id. at 117-118.

aAHSEC

16.

Id. at 123-128.

17.

Rollo ( G.R. No. 157381), pp. 181-182.

18.

Rollo (G.R. No. 153690), p. 555.

19.

Penned by Associate Justice Ma. Alicia Austria-Martinez, with Associate Justices

Hilarion L. Aquino and Jose L. Sabio, Jr., concurring, rollo (G.R. No. 153690) pp.
257-259.

20.

Id. at 257-259.

21.

Id. at 323-324.

22.

Penned by Associate Justice Romeo A. Brawner, with Associate Justices Elvi John
S. Asuncion and Juan Q. Enriquez, Jr., concurring, rollo (G.R. No. 153690), pp. 6978.

23.

G.R. No. 139396, August 15, 2000, 338 SCRA 62.

24.

Rollo (G.R. No. 153690), pp. 69-78.

25.

Id. at 80-86.

26.

Rollo (G.R. No. 157381), p. 316.

27.

Id. at 24.

28.

Id. at 26.

29.

Id. at 317.

30.

Penned by Associate Justice Eubolo G. Verzola, with Associate Justices Sergio L.

Pestao and Amelita G. Tolentino, concurring; id. at 313-319.

31.

Rollo (G.R. No. 170889), p. 16.

32.

Id. at 22-23.

33.

Id. at 106-121.

34.

Id. at 119-121.

35.

Id. at 193-214.

36.

Id. at 215-221.

37.

Id. at 72.

38.
39.

aTEScI

Penned by Associate Justice Arsenio J. Magpale, with Associate Justices Vicente L.

Yap and Ramon M. Bato, Jr., concurring; id. at 72-73.

Rollo, pp. 288-320.

40.

Id. at 76-78.

41.

Rollo (G.R. No. 153690), p. 623.

42.

Id. at 646-664.

43.

Rollo (G.R. No. 157381), pp. 17-52.

44.

Id. at 645-649.

45.

Id. at 649.

46.

Id. at 654-658.

47.

Rollo (G.R. No. 170889), pp. 483-484.

48.

Id. at 141-142.

49.

Rollo (G.R. No. 153690), pp. 613-637.

50.

Section 5, Rule 7 of the Rules of Court provides:

SEC. 5.
Certication against forum shopping. The plainti or principal party
shall certify under oath in the complaint or other initiatory pleading asserting a
claim for relief, or in a sworn certication annexed thereto and simultaneously led
therewith: (a) that he has not theretofore commenced any action or led any claim
involving the same issues in any court, tribunal or quasi-judicial agency and, to the
best of his knowledge, no such other action or claim is pending therein; (b) if there
is such other pending action or claim, a complete statement of the present status
thereof; and (c) if he should thereafter learn that the same or similar action or
claim has been led or is pending, he shall report that fact within ve (5) days
therefrom to the court wherein his aforesaid complaint or initiatory pleading has
been filed.
cHCIEA

Failure to comply with the foregoing requirements shall not be curable by mere
amendment of the complaint or other initiatory pleading but shall be cause for the
dismissal of the case without prejudice, unless otherwise provided, upon motion
and after hearing. The submission of a false certication or non-compliance with
any of the undertakings therein shall constitute indirect contempt of court, without
prejudice to the corresponding administrative and criminal actions. If the acts of
the party or his counsel clearly constitute willful and deliberate forum shopping,
the same shall be ground for summary dismissal with prejudice and shall
constitute direct contempt, as well as a cause for administrative sanctions.
51.

Rollo (G.R. No. 153690), pp. 646-664.

52.

See Air Materiel Wing Savings and Loan Association, Inc., et al. v. Manay, et al. ,
G.R. No. 175338, April 29, 2008.

53.

Figuracion v. Libi, G.R. No. 155688, November 28, 2007, citing The Philippine
American Life & General Insurance Company v. Breva, 442 SCRA 217, 223 (2004);
Negros Merchants Enterprises, Inc. v. China Banking Corporation, G.R. No.

150918, August 17, 2007, 530 SCRA 478, 487.

54.
55.

Rollo (G.R. No. 157381), pp. 654-657.

Pulido v. Abu, G.R. No. 170924, July 4, 2007, 526 SCRA 483, 496; Garayblas v.
Atienza, Jr., G.R. No. 149493, June 22, 2006, 492 SCRA 202, 216.

56.

Pulido v. Abu, id. at 496.

57.

Rollo (G.R. No. 157381), pp. 17-52.

58.

Rollo (G.R. No. 170889), pp. 119-120.

DAcSIC

59.

Caneland Sugar Corporation v. Alon, G.R. No. 142896, September 12, 2007, 533
SCRA 28, 32.

60.

See Kho v. Court of Appeals, G.R. No. 115758, March 19, 2002; See also La Vista
Association, Inc. v. Court of Appeals, 278 SCRA 498 (2002).

61.

Ticzon v. Videopost, Manila, 389 Phil. 20, 30 (2000).

62.

Manalo v. Calderon, G.R. No. 178920, October 15, 2007, 536 SCRA 290, 303.

63.

Rollo (G.R. No. 170889), pp. 464-559.

64.

Far East Bank and Trust Company v. Shemberg Marketing Corporation, G.R. No.
163878, December 12, 2006, 510 SCRA 685, 700.

65.

Far East Bank and Trust Company v. Shemberg Marketing Corporation, id. at
700, citing Singson v. Isabela Sawmill, 88 SCRA 623 (1970); Russell v. Hon. Vestil,
364 Phil. 392, 400 (1999).
STcEIC

66.

In their original complaint, David, et al. specifically prayed:

WHEREFORE, based on the foregoing premises, it is respectfully prayed that this
Honorable Court rule in favor of the Plaintiffs, as follows:
1.
Declare null and void the issuance of 600,000 unsubscribed and unissued
shares to Defendants Lu Ym father and sons and their spouses, children and
holding companies, for a price of only one-eighteenth of their real value, as having
been done in breach of directors' duciary duty to stockholders, in violation of
Plaintis' minority stockholders' rights, and in unjust enrichment of the
Defendants, majority/controlling stockholders/directors, at the expense of their
cousins, the other stockholders.

2.
Order the dissolution of Defendant Ludo and LuYm Development
Corporation, in order to protect the rights and redress the injuries of Plaintiffs;
3.
During the pendency of the instant case, order the appointment of a
receiver pendente lite for LuDo and LuYm Development Corporation.

Such other reliefs as may be just and equitable on the premises are likewise prayed
for; rollo, G.R. No. 170889, pp. 84-85.
In his amended complaint, David specifically prayed:
WHEREFORE, based on the foregoing premises, it is respectfully prayed that this
Honorable Court rule in favor of the Plaintiffs, as follows:
1.
Declare null and void the issuance of 600.000 unsubscribed and unissued
shares of the defendant corporation to Defendants Lu Ym father and sons and
their spouses, children, and holding companies, for a price of one-eighteenth of
their real value, for being inequitable, having been done in breach of director's
duciary duty to stockholders, in violation of Plaintis' minority stockholders'
rights, and in unjust enrichment of the Defendants, majority controlling
stockholders/directors, at the expense of their cousins, the other stockholders.
2.
Order the dissolution of Defendant Ludo and Luym Development
Corporation, in order to protect the rights and redress the injuries of Plaintiffs;
3.
Order the creation of a management committee pendente lite, and order
receiver Luis Caete to turn over all assets and records to the management
committee.
Such other relief as may be just and equitable on the premises are likewise prayed
for. [Rollo (G.R. No. 153690), pp. 689-690.]
67.

68.
69.

Heirs of Bertuldo Hinog v. Melicor, G.R. No. 140954, April 12, 2005, 455 SCRA
460, 473; Pantranco North Express, Inc. v. Court of Appeals, G.R. No. 105180,
July 5, 1993, 224 SCRA 477, 491.
Heirs of Bertuldo Hinog v. Melicor, id. at 473.
Idolor v. Court of Appeals, G.R. No. 161028, January 31, 2005, 450 SCRA 396,
404.
aDIHTE

70.

No. L-75919, May 7, 1987, 149 SCRA 562.

71.

G.R. No. 169108, April 18, 2006, 487 SCRA 339.

72.

G.R. No. 140894, November 27, 2000, 346 SCRA 141.

73.

G.R. No. 140162, November 22, 2000, 345 SCRA 579.

74.

Supra note 71, at 350.

75.

Supra note 72, at 148.

76.

Supra note 73, at 585.

77.

Moskowsky v. Court of Appeals, 366 Phil. 189, 196 (1999); Pantranco North
Express, Inc. v. Court of Appeals, G.R. No. 105180, July 5, 1993, 224 SCRA 477,
491.

78.

Yujuico v. Quiambao, G.R. No. 168639, January 29, 2007, 513 SCRA 243, 263;
MIAA v. Court of Appeals, 445 Phil. 369, 382 (2003), citing Garcia v. Burgos, 291
SCRA 546 (1998).

Additional member replacing Associate Justice Alicia Austria-Martinez per rae

dated July 30, 2008.