CUA JR. vs. OCAMPO G.R. Nos.

181455-56 & 182008 - December 4, 2009 FACTS: Two petitions were

presented before the SC: (1) a Petition for Review on Certiorari under Rule 45 of the Rules of Court filed
by petitioners Santiago, Cua, Jr., Solomon Cua, and Robles in their capacity as director of the Philippine
Racing Club, Inc. (PRCI) and (2) a Petition for Certiorari and Prohibition under Rule 65 of the Rules of
Court filed by petitioner Santiago Cua Sr. Both petitions assail the Decision and Resolution of the CA in
the consolidated cases CA-G.R. No. 99679 and No. 99780. PRCI is a corporation organized and
established under Philippine laws to: (1) carry on the business of a race course in all its branches, and, in
particular, to conduct horse races or races of any kind, to accept bets on the results of the races, etc.;
and (2) to promote the breeding of better horses in the Philippines, lend all possible aid in the
development of sports, and uphold the principles of good sportmanship and fair play. In 1999, the AOI
of PRCI was amended to include a secondary purpose, viz: To acquire real properties and/or develop
real properties into mix-use realty projects including but not limited to leisure, recreational and
memorial parks and to own, operate, manage and/or sell these real estate projects. PRCI owns only 2
real properties, each covered by several TCT. One is known as the Sta. Ana Racetrack (Makati property),
measuring up to 21.2 hectares and the other is located in the towns of Naic and Tanza in Cavite (Cavite
property). Following the trend in the development of properties in the same area, PRCI wished to
convert its Makati property from a racetrack to urban residential and commercial use. Given the
location and size of its Makati property, PRCI believed that the same was severly underutilized. Hence,
PRCI management decided to transfer its racetrack from Makati to Cavite. As to its Makati property,
PRCI management decided it was best to spin off the management and development of the same to a
wholly owned subsidiary, so that PRCI could continue to focus its efforts on pursuing its core business
competence of horse racing. Instead of organizing and establishing a new corporation for the said
purpose, PRCI management opted to acquire another domestic corporation, JTH Davies Holdings, Inc.
(JTH). The PRCI Board of Directors held a meeting on September 26, 2006. Among the directors present
were petitioners Santiago Sr., Santiago Jr., and Solomon as well as respondent Dulay. All the directors
present, except respondent Dulay, voted affirmatively and resolved that PRCI intends to acquire up to
100% of the common shares of stock of JTH by way of negotiated sale. The next day, September 27,
2006, PRCI entered into a Sale and Purchase Agreement for the acquisition from JME of 9