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PHILIPPINE
AMUSEMENT AND GAMING CORPORATION,
G.R. No. 108838 July 14, 1997 -versus-COURT
OF APPEALS, HON. JULIO R. LOGARTA, in
his
FRANCISCO, J.:
Pursuant
to a "Contract to Operate" entered
into on December 17, 1985 whereby herein petitioner Philippine
Amusement
and Gaming Corporation (hereafter PAGCOR) granted private respondent
Philippine
Casino Operators Corporation (PCOC) sole and exclusive right to manage
gambling casinos in the entire Philippines, PCOC operated casinos in
Manila,
Cebu and Laoag, Ilocos Norte.
Philippine Casino Operators Corporation Manila Sir: "By virtue of the powers vested unto this Commission by the President of the Philippines, I hereby order the take-over of all assets, movable or immovable of the two (2) above corporations. It is further ordered that the operations of all casinos in the country be provisionally stopped and until further permit to operate is given by the Philippine Laws Amusement Corporations and this Commission. "The Tax Force headed by Mr. Carmelo Lazatin, is hereby authorized to implement the following: "1. Conduct an inventory of all assets and properties within the premises of the Casinos. "2. To make an audit and inventory of all the money and movable equipment as well as gambling paraphernalia presently being used in the operations of the Casinos. "3. To secure all properties, records, receipts, documents, and other pertinent books of accounts, ledgers relative to the operation of the Casinos. "Very truly yours,
(Sgd.)
PAGCOR then caused the transportation of gaming and office equipment and paraphernalia used in the Laoag casino to its Metro Manila offices for safekeeping. On June 12, 1986 while the trucks containing said equipment were enroute to PAGCOR's offices, private respondent Eduardo Marcelo (Marcelo) intercepted said trucks and ordered the drivers to bring the cargoes to his compound at Governor Pascual Avenue, Malabon. This prompted PAGCOR to file, on July 25, 1986, a civil case before the Makati Regional Trial Court against private respondents Marcelo, PCOC, "John Doe" and "Peter Doe" for recovery of personal property. Presiding Judge Santiago Ranada, Jr., on even date, issued the writ of replevin and consequently, the gaming and office equipment were turned over to PAGCOR.cralaw:red Judge Julio Logarta heard the case after private respondents (as defendants), on August 13, 1986, filed their answer with counterclaim alleging, among others, that the court has no jurisdiction.cralaw:red After PAGCOR [as
plaintiff] rested its case on
November 8, 1990, a demurrer to evidence was filed grounded on"
(2) PAGCOR's failure to sufficiently prove its ownership over the properties, PAGCOR filed its opposition to the demurrer. Judge Logarta,
acting on the demurrer, issued an
order dated May 6, 1991 (the first assailed order) dismissing the case
for lack of jurisdiction and lifting the writ of replevin. He ruled
that
the case falls within the exclusive jurisdiction of the Sandiganbayan,
citing as authorities "PCGG v. Peña"[1]
which held that:
PAGCOR filed a motion for reconsideration thereof, alleging that the sequestration of PCOC's assets did not include the gaming and office equipment PAGCOR claims to own. PCOC and Marcelo likewise filed a motion for reconsideration, praying that PAGCOR be directed to return to them all the items seized under the writ of replevin.cralaw:red Judge Logarta, in an order dated October 15, 1991 (the second assailed order), denied PAGCOR's motion for reconsideration, but granted that of PCOC and Marcelo.cralaw:red PAGCOR thereafter filed another motion for reconsideration on November 7, 1991, arguing that the RTC has already acquired and acknowledged jurisdiction. This was likewise denied in an order dated March 4, 1992 (the third assailed order).cralaw:red PAGCOR sought the nullification of the RTC's May 6, 1991, October 15, 1991 and March 4, 1992 orders before public respondent Court of Appeals (CA) via petition for certiorari and prohibition, claiming that grave abuse of discretion attended their issuance.cralaw:red The CA, however, in its now assailed Decision of January 29, 1993, denied due course to PAGCOR's petition. It basically affirmed the RTC's findings that a) the controversy falls within the jurisdiction of the Sandiganbayan, and b) PAGCOR failed to prove that it owns the subject properties. Hence, this petition.cralaw:red We disagree with
the RTC and the CA on the issue
of jurisdiction. While there can be no dispute that PCOC was
sequestered,
the fact of sequestration alone did not automatically oust the RTC of
jurisdiction
to decide upon the question of ownership of the subject gaming and
office
equipment. The PCGG must be a party to the suit in order that the
Sandiganbayan's
exclusive jurisdiction may be correctly invoked. This is deducible from
no less than E. O. No. 14, the "Peña" and "Nepomuceno" cases
relied
upon by both subordinates courts. Note that in Section 2 of E. O. No.
14
which provides:
On the question
of ownership over the subject
properties, the more prudent action is to remand the case to the RTC
for
its resolution in order that private respondents PCOC and Marcelo may
be
given the opportunity to present evidence which, by having opted to
file
a demurrer that was subsequently granted, they were not able to do so.
While this recourse seems to run counter to Section 1, Rule 35 of the
Rules
of Court which reads:
WHEREFORE, the instant petition is hereby GRANTED. The assailed orders of the RTC dated May 6, 1991, October 15, 1991 and March 4, 1992, and the January 29, 1993 Decision of public respondent CA affirming said orders, are REVERSED and SET ASIDE. Let this case be REMANDED to the court of origin for reception of evidence and further proceedings.cralaw:red SO ORDERED.cralaw:red Narvasa, C.J., Davide, Jr., Melo and Panganiban, JJ., concur.cralaw:red __________________________________
[1]
159 SCRA 556.
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