CHEMPHIL EXPORT & IMPORT CORPORATION v. GONZALES G.R. No. 112438‐39, December 12, 1995 | G.R. No. 113394, December 12, 1995


FACTS: Dynetics  and  Garcia  filed  a  complaint  for  declaratory  relief  and/or  injunction  against  PISO,  BPI,  LBP,  PCI  Bank  and  RCBC  or  the consortium  with  the  RTC  of  Makati,  seeking  judicial  declaration,  construction  and  interpretation  of  the  validity  of  the  surety  agreement that Dynetics and Garcia  entered into with  the consortium  and to perpetually enjoin the latter from claiming, collecting and  enforcing any  purported obligations  which Dynetics  and Garcia might have undertaken in the  agreement.
Seven  months  later,  Dynetics,  Garcia  and  Matrix  Management  filed  a  complaint  for  declaratory  relief  and/or  injunction  against  Security Bank & Trust Co. The court granted SBTC’s prayer for the issuance of a writ of preliminary attachment, where a notice of garnishment on the shares of Garcia in Chemphil was served on Chemphil. However, this writ was thereafter lifted, and then reinstated.
In  the  meantime,  the  court  denied  the  application  of  Dynetics  and  Garcia  for  preliminary  injunction  and  instead  granted  the consortium’s prayer  for a consolidated writ of preliminary  attachment (case 8527). The garnishment for this attachment was NOT annotated in Chemphil’s stock and transfer book.  Motion to dismiss was filed by PCI Bank—granted. MR filed by consortium—denied.
During the pendency of the appeal, a compromise agreement was entered into between Garcia and the consortium.
In 1988, Garcia under a Deed of Sale transferred to Ferro Chemicals (FCI) the disputed shares and other properties for P79M. It was agreed  that  part  of  the  purchase  price  shall  be  paid  to  Security  Bank  for  whatever  judgment  credits  it may  be  adjudged  against Garcia.
FCI issued a check—refused by Security Bank because it was insufficient to cover the debt.
FCI assigned 4M shares in Chemphil to CEIC.
Garcia failed to comply with the compromise agreement—consortium filed a motion for execution—granted by the court. Garcia’s properties were levied upon on execution were his 1.7M shares in Chemphil previously garnished. The consortium acquired the disputed shares of stock in the public sale conducted by the sheriff for P85M.
CEIC filed a motion to intervene saying that it is the owner of the shared—granted by the court, but limited only to the incidents covered by the order. Consortium opposed to CEIC’s motion—their attachment lien over the shares must prevail over the private sale in favor of CEIC considering that the shares were garnished in the consortium’s favor. On December 1989 Trial court granted CEIC’s motion and denied consortium’s.
Consortium and PCIB filed separate motions for reconsideration for the aforesaid order –which was denied (March 1990). Consortium appealed to the CA and PCIB separately filed to the same court petition for certiorari, prohibition and mandamus with a prayer for the issuance of the writ of preliminary injunction, likewise assailing the very same orders (dated December 1989 and March 1990).
CA rendered decision confirming the ownership of Consortium over disputed shares and dismissing PCIB’s petition for certiorari on the grounds that PCIB violated the rule against forum-shopping and that no grave abuse of discretion was committed by the Trial court issuing the assailed orders. PCIB filed to the SC petition for review.

ISSUE: WON PCIB is guilty of forum-shopping.

RULING: The SC upholds the decision of the CA finding PCIB guilty of forum-shopping. Rule 65 of the Rules of Court is not difficult to understand. Certiorari is available only if there is no appeal or other plain, speedy and adequate remedy in the ordinary course of law. Hence, in instituting a separate petition for certiorari, PCIB has deliberately resorted to forum-shopping. PCIB cannot hide behind the subterfuge that SC Circular 28-91 was not yet in force when it filed the certiorari proceedings in the CA. The rule against forum-shopping has long been established. SC Circular 28-91 merely formalized the prohibition and provided the appropriate penalties against transgressors.
Forum-shopping or the act of the party against whom an adverse judgment has been rendered in one forum, of seeking another opinion (and possibly favorable) in another forum (other than by appeal or the special civil action for certiorari), or the institution of two (2) or more actions or proceedings grounded on the same cause on the supposition that one or the other court would make a favorable disposition, has been characterized as an act of malpractice that is prohibited and condemned as trifling with the Courts and abusing their processes. It constitutes improper conduct which tends to degrade the administration of justice. It has also been aptly described as deplorable because it adds to the congestion of the already heavily burdened dockets of the courts.
For resorting for forum-shopping, PCIB was reprimanded and warned by the SC.

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