REPUBLIC OF THE PHILIPPINES

First Judicial Region

Regional Trial Court
Baguio City
Branch 1

James Band, represented by

James Band Jr., Plaintiff

Civil Case No.16-00001

For: Specific Performance,
and Damages

-versusWideland Realty Incorporated,

Defendant
X----------------------------------------------------------------------------------------X
MEMORANDUM
The Defendant, through the undersigned counsel, respectfully submits
unto this Honourable Court and present this Memorandum for the Courts
perusal in the above-titled case:
I. PREFATORY STATEMENT
James Band, if favored, will be akin to favoring a Band of Bandits.
The crux of the case is an action for specific performance plus damages
by the Plaintiff due to his claim of unpaid salaries for his services he
rendered to the defendant-corporation from 1995-2005 allegedly amounting
to a whopping 15 Million Pesos. The Plaintiff is now asking for an
Agricultural land, condominium units, and corporate shares as payment
therefor.

II.FACTUAL ANTECEDENTS
In his complaint, The Plaintiff alleged that:
1.
James Band, is of legal age, a resident and a citizen of the
United States of America, with address in the Philippines at No. 123
Mordung Road Baguio City. He is duly represented in this case by
James Band Jr., by virtue of the Special Power of Attorney executed
by herein plaintiff, of legal age, married, Filipino, with residence at
No.123 Mordung Road Baguio City.
2.
The Defendant, Wideland Realty Incorporated or WRI for
brevity, is a corporation with principal address in No.23 Mapukpukaw
Street Dimasarakan City, Philippines, represented by Jonah and Joyce
Jones as corporate officers and board directors of the corporation.
3.
Plaintiff was the former General Manager and member of the
Board of Directors of Defendant. He desires the satisfaction of his
unpaid salaries that had accrued during course of employment with
WRI in the years (1995-2005).
4. A Board Resolution 02-0202 series of 2005 was was made by the
WRI Board containing details of how the obligation to Plaintiff will
be fulfilled, i.e. the delivery of certain properties that have been
agreed upon by the Board Members, including the following:
a. 5 corporate shares of Pang-Ur Golf and
Country Club valued at P1,000,000/share;
b. Units 1,2,3,4 and 5 of Margaay Condominium
with a sum total value of Five Million Pesos
(P5,000,000);
c. 5 hectares of agricultural land located in
Liblib, Suli covered by TCT No. 02 with an
estimated value of Five Million Pesos
(P5,000,000.00)
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6.
On 7 January 2015, Plaintiff allegedly transmitted a letter of
demand to Ms. Joyce Jones- President and Chairman of the Board
of Directors claiming for the completion of the subject of the said
board resolution.

7. Left unheeded, On 17 March 2015, Plaintiff filed a complaint

through his attorney-in-fact James Band, Jr. for the completion of
the Board Resolution.

8.
The plaintiffs claim remained to be unsatisfied as the
properties were not registered in his name. Despite the
improvements already introduced by the plaintiff in the 5 hectare
agricultural land he allegedly subsequently discovered that the 2
hectares thereof were owned by another corporation.

9. The shares of stock in Pang-Ur Golf and Country Club were

not titled in the plaintiffs name and so are the Margaay
condominium units 4 and 5 which are currently in the possession
of two lessees, a knowledge which the plaintiff was allegedly
bereft of.

III. DEFENDANTS VERSION

Defendant-Corporation, on the other hand, vehemently denies the allegations
in the said complaint. It claims that the complaint should fail on its merits,
and in its Special and Affirmative Defenses, averred among others:
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1. Wideland Board Resolution 02-0202 series of 2005 does not

contain any obligation to cause the transfer and registration of the
properties to James Band, it merely states that the properties shall
be delivered to James Band.

2. Plaintiff failed to allege who the real owner of Unit 1 Margaay

Condominium is and it merely stated that it is owned by Kibungan
Corporation.

3. The Board Resolution merely stated that Wideland deliver the

agricultural land is to James Band, there is no stipulation or
agreement in the Board Resolution which obliges Wideland to
cause the transfer and registration of the said land to James Band;

4. Assuming arguendo that the 5 hectare agricultural land in Liblib,

Suli covered by TCT No.2 should be transferred and registered in
the name of James Band, such could not be registered under the
name of James Band since he is an American Citizen as admitted
in paragraph 1 of the plaintiffs complaint. He further may not
claim 3 hectares by virtue of the Foreign Investment Act because
such land must be used for business purposes only. James Band has
no proof that such land is used for business purposes or will be
used for business purposes exclusively;

5. The truth of the matter is that Wideland never received such

letter marked as Annex D by the Plaintiff because nothing in the
alleged demand letter indicates that it was duly received by
Wideland President Joyce Jones on January 7, 2015 or any
authorized personnel of the corporation.;
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6. James Band failed to make a formal demand to Wideland for

almost 10 years to deliver the properties to him, as such he is
estopped from claiming for the delivery of the properties, and
barred by laches due to his inaction for a long period;

7. Plaintiff could not order Wideland to cause the evacuation of the

lessees of Unit 4 and 5 of Margaay Condominium since the former
is not the owner of the said units.

8. Plaintiff could not order Wideland to cause the evacuation of the

lessees of Unit 4 and 5 of Margaay Condominium since the
existing Contract of Lease between the lessees of such unit and
Wideland, vested to the lessees the right to occupy the property
until the termination of the lease contract;

9. Plaintiff is not entitled to the accrued rent of Unit 4 and 5 of

Margaay Condominium since no stipulation in the Wideland Board
Resolution 02-0202 series of 2005 granted the right to the accrued
rent, pending delivery, in favor of James Band;

Lack of jurisdiction of the Regional Trial Court over the

subject matter

10. James Band, being the General Manager, is a mere employee

of the corporation. Thus, money claims arising from unpaid
salaries, as in this case, is under the jurisdiction of the Labor

Arbiter and National Labor Relations Commission, not under the

Regional Trial Court;

Fulfillment of the obligation to deliver the properties

11. Plaintiff seeks that Wideland cause the transfer and registration
of the properties to the name of James Band, however, it is clear
from the Board Resolution, that Wideland would merely deliver
the properties to James Band, and has no obligation to cause the
transfer and registration of the properties in the name of James
Band;

12. Delivery was completed when James Band took possession of

the agricultural land by virtue of Wideland Board Resolution 020202 series of 2005;

13. Delivery of the 5shares of Pang-Ur Golf and Country club was
already fulfilled since James Band is able to enjoy the benefits and
amenities of Pang-Ur Golf and Country club, by virtue of
Wideland Board Resolution 02-0202 series of 2005, until he left
for the United States of America;

IV. ISSUES OF THE CASE

1. Whether or not the Board Resolution 02-0202 series of 2005 is

enforceable.
a. If so
1. What do we do with the agricultural land?
2. What do we do with the condominium units?
a. For Unit 1 and
b. For the Rentals that fell and will fall due
3. What do we do with the corporate shares being claimed by the
Plaintiff?
b. If not, how do you propose to compensate?
2.

Who between the plaintiff and defendant is entitled to damages?

I.

1.

ARGUMENTS

The Board Resolution 02-0202 series of 2005 is

UNENFORCEABLE. Hence, it follows that the Agricultural
Land should still be owned by Wideland, the condominium
units should continue to be rented by the tenants and such
rents shall accrue to the benefit of the defendant-corporation,
and no corporate shares shall be given to herein Plaintiff.
B. Thus, James Band can only be compensated based on what
is just and equitable to be determined by the National Labor
Relations Commission. The defendant humbly stands by its
conviction that it is the NLRC that should truly hear the case
based on the Doctrine of Exhaustion of Administrative
Remedies or Primary Jurisdiction.
Whatever the verdict of the said body will be, Wideland will
most certainly comply.

2.

The defendant-corporation is entitled to exemplary damages

plus costs.
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II.

DISCUSSION

1. The Board Resolution 02-0202 series of 2005 is unenforceable

Anent the first issue, defendant humbly submits that this
Honorable Court cannot resolve the said issue for Lack of
Jurisdiction under the following:
All issues regarding unpaid salaries shall be heard by the
Labor Arbiter.
It is worthy to note that under Art. 129 of the Labor
Code:
Art. 129. Recovery of wages, simple money claims and other
benefits. Upon complaint of any interested party, the Regional
Director of the Department of Labor and Employment or
any of the duly authorized hearing officers of the Department is
empowered, through summary proceeding and after due notice,
to hear and decide any matter involving the recovery of
wages and other monetary claims and benefits, including legal
interest, owing to an employee or person employed in domestic
or household service or househelper under this Code, arising
from employer-employee relations
Moreover, assuming that it has jurisdiction, the Board
Resolution cannot be enforced as it is considered as
unconscionable since the claims reflected on it would be
prejudicial to and will totally paralyze the operation of the
corporation to the point of dissolution. 15 Million Pesos is
purely atrociously too much and is not just spare change.
A corporation relies on its capital to fully function as
such. Taking the capital away would mean death to the
corporation. It is also impossible to enforce the said board
resolution because for one, the claimed Condominium Units are

still being leased to its tenants and such lease agreement did not
yet expire.
A stockholder cannot without violating the Trust Fund
Doctrine compel the corporation to return his investments
without the consent of all the stockholders. Neither does he
have the right to withdraw even when all the stockholders
assent thereto if there is prejudice to the creditors. The
underlying reason for the restriction springs from the necessity
of imposing safeguards against the depletion by a corporation
of its assets and the impairment of its capital needed for the
protection of its creditors. [Commissioner of Internal
Revenue v CA, 301 SCRA 152 1999; SEC Opinion 24
August 1992]
Furthermore, the Supreme Court held in another leading
case:
That respondent who was also a director and a
stockholder of petitioner corporation will not automatically
make the case fall within the ambit of intra-corporate
controversy and be subjected to RTCs jurisdiction.

To reiterate, not all conflicts between the stockholders

and the corporation are classified as intra-corporate. Other
factors such as the status or relationship of the parties and the
nature of the question that is the subject of the controversy must
be considered in determining whether the dispute involves
corporate matters so as to regard them as intra-corporate
controversies. As previously discussed, respondent was not a
corporate officer of petitioner corporation but a mere employee
thereof so there was no intra-corporate relationship between
them. (Joson vs. Joson; G.R. No. 171993; December 12,
2011)

1.b. Thus, he can be compensated based on what is considered as just

and equitable by the National Labor Relations Commission based on the
circumstances surrounding the case. The defendant humbly stands by its
conviction that it is the NLRC that should truly hear the case based on the
Doctrine of Exhaustion of Administrative Remedies or Primary Jurisdiction.
2.

The defendant-corporation is the one entitled to exemplary

damages plus costs.
The defendant-corporation has had a good reputation as a
business and for being one of the prime developers in the
country until its good name was dragged into this controversy
by this ungrateful employee even if, in some way, he was
already compensated when he enjoyed his Pang-ur shares by
availing of the corporations Club House amenities until he left
for the United States.
This tarnished reputation has led to a lower income
generation since the case was instituted at the onset of 2015 as
well as the feeling of insecurity of current members and
stockholders and distrust of potential buyers of the stocks or
would-be customers of the corporations services and offerings.

The purpose of exemplary damages is to serve as a deterrent

to future and subsequent parties from the commission of a
similar offense. The case of People v. Rante citing People v.
Dalisay held that:
Also known as punitive or vindictive damages, exemplary or
corrective damages are intended to serve as a deterrent to serious
wrong doings, and as a vindication of undue sufferings and wanton
invasion of the rights of an injured or a punishment for those guilty
of outrageous conduct. These terms are generally, but not always,
used interchangeably.

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In common law, there is preference in the use of exemplary

damages when the award is to account for injury to feelings and
for the sense of indignity and humiliation suffered by a person as a
result of an injury that has been maliciously and wantonly
inflicted, the theory being that there should be compensation for
the hurt caused by the highly reprehensible conduct of the
defendantassociated with such circumstances as willfulness,
wantonness, malice, gross negligence or recklessness, oppression,
insult or fraud or gross fraudthat intensifies the injury. The terms
punitive or vindictive damages are often used to refer to those
species of damages that may be awarded against a person to punish
him for his outrageous conduct.
In either case, these damages are intended in good measure to
deter the wrongdoer and others like him from similar conduct in
the future.
Since the award of exemplary damages is proper, attorneys
fees and cost of the suit may also be recovered. Article 2208 of the
Civil Code states:
Article 2208. In the absence of stipulation, attorney's fees and
expenses of litigation, other than judicial costs, cannot be
recovered, except:
(1) When exemplary damages are awarded. (ARCO PULP AND
PAPER CO., INC. AND CANDIDA A. SANTOS, v. DAN T.
LIM, DOING BUSINESS UNDER THE NAME AND STYLE
OF QUALITY PAPERS & PLASTIC PRODUCTS
ENTERPRISES, G.R. No. 206806, June 25, 2014)
Housing development is an indispensable institution in the
modern world and plays a vital role in the economic life of every
civilized nation. Therefore, so that future disgruntled employees
will be deterred to do these unethical practices of milking a
corporation dry down to its very last centavo, exemplary damages
shall be granted in this instant case.

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As stated in Simex International vs. CA (G.R. No. 88013

March 19, 1990):
"by way of example or correction for the public good," in the
words of the law. It is expected that this ruling will serve as a
warning and deterrent against the repetition of the ineptness and
indefference that has been displayed here, lest the confidence of
the public in the banking system be further impaired.
III.

PRAYER

WHEREFORE, premises considered, it is respectfully

requested from this Honourable Court that the plaintiff be ordered
to:
(1)
(2)
(3)

Drop the Complaint against the DefendantCorporation;

Pay the defendant damages for the action instituted
against its good name and reputation as a
corporation;
Other pronouncements this honourable court may
deem fit.

BAGAYAO, DONGGAYAO, LABIAGA, PASCUAL, POSERIO, AND

POCAIS LAW OFFICE
Counsel for the defendant
Suite 69 Bigotilyos el Guapitos Building,
BukangLiwayway St., Baguio City
By:
____________________________________
KURT PAUL GACOSCOS BAGAYAO
Suite 69 Bigotilyos el Guapitos Building,
BukangLiwayway St., Baguio City
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Roll No. 161616

PTR No. 19932909/07-07-17/Baguio City
IBP Lifetime No. 19870312
MCLE Compliance No. 888
07-01-17/Baguio City
NA No. 5960, Baguio City
V E R I F I C AT I O N
Republic of the Philippines)
X - - - - - - - - - - - - - - - -x) S.S.
City of Baguio - - - - - - - )
I, Don Pepe Jones, of legal age, Filipino citizen, after having been
duly sworn in accordance with law, hereby state that:
1.
I am the President of Wideland Realty Incorporated, the defendant in
the above-entitled case;
2.
Upon the instruction and authority of Wideland Realty Incorporated,
the defendant, I caused the preparation and filing of the foregoing Answer;
3.
That I have read the contents of this pleading and the same are true
and correct to the best of my personal knowledge and based on the authentic
records and documents which are in my possession.
IN WITNESS WHEREOF, I have hereunto set my hand this 21st of March
2016 at Baguio City, Philippines.
Don Pepe Jones
Corporate President
Subscribed and sworn to before me this 21st day of March 2016, in Baguio
City, affiant showing me his Passport No. 16895, valid until May 8, 2019,
issued at Baguio City.

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Atty. Boy Matipuno

Notary Public, Baguio City
NA. No. 234534/06-04-18/Baguio
Roll of Attorney No. 4534
PTR No. 27895/09-01-18/Baguio
IBP Lifetime No. 4566
MCLE Compliance No. 8978/01-01-17
Tin No. 107685

Doc. No. 1
Page No. 13
Book No. XVI
Series No. 2016

SECRETARYS CERTIFICATE
I, JONAH JONES, am the Corporate Secretary of Wideland Realty
Incorporated, a corporation duly incorporated under the laws of the
Philippines, after having duly sworn in accordance with law, hereby certify
that:
1.
By virtue of our corporations by-laws, the Corporate President is the
authorized corporate officer to cause the preparation and filing of necessary
pleadings required by judicial and quasi-judicial bodies in legal actions
instituted by or against the corporation;
14

2.
Don Pepe Jones is the current Corporate President of Wideland
Realty Incorporated who is hereby authorized to exercise the powers of
corporate president, particularly to cause the preparation and filing of the
foregoing Answer in the present case.
IN WITNESS WHEREOF, I have hereunto set my hand this 21st of March
2016 at Baguio City, Philippines.
Jonah Jones
Corporate Secretary

Subscribed and sworn to before me this 21st day of March 2016, in

Baguio City, affiant showing me her Drivers License No. 89768, valid until
February 14, 2017, issued at Baguio City.
Atty. Boy Matipuno
Notary Public, Baguio City
NA. No. 234534/06-04-18/Baguio
Roll of Attorney No. 4534
PTR No. 27895/09-01-18/Baguio
IBP Lifetime No. 4566
MCLE Compliance No. 8978/01-01-17
Tin No. 107685
15

Doc. No. 2
Page No. 15
Book No. XVI
Series No. 2016
Copy furnished thru personal service to:
Atty. Lucille Arianne B. Donato
Counsel for the Plaintiff
#123, Brookside, Baguio City

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