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[ G.R. No. 136194. January 18, 1999]

CHUA SUY PHEN, et al. v. CONCEPCION CHUA GAW, et al.

SECOND DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated JAN 18, 1999.

G.R. No. 136194 (Chua Suy Phen, et al. v. Concepcion Chua Gaw, et al.)

Petitioners and respondent are siblings. When their father died, they, together with their mother, executed a deed of extrajudicial partition and renunciation of hereditary rights whereby they assigned in favor of their brother Chua Sioc Huan their respective interests in the Hagonoy Lumber. After the death of their mother, private respondents filed a complaint against petitioners in the Regional Trial Court, Branch 75 of Valenzuela, Metro Manila for partition and distribution of the estate of their deceased parents consisting of investments in Capital Sawmill Corporation and Columbia Wood Industries. Petitioners sought the dismissal of the complaint on the ground that the trial court had no jurisdiction over the case considering that the case allegedly involved an intracorporate dispute cognizable by the Securities and Exchange Commission (SEC). Private respondents opposed the motion arguing that the complaint was actually for "judicial determination of the share of the parties, the partition of the entire of their deceased parents, and the equitable distribution of the shares to all the heirs." The trial court upheld private respondents' stand and denied petitioners' motion. Petitioners moved for reconsideration but the trial court denied the same. Petitioners then brought the matter by way of petition for certiorari to the Court of Appeals which, however, dismissed the petition for lack of merit. Hence, this petition for review of the decision of the Court of Appeals.

After due consideration of the petition, the Court finds no reversible error committed by the Court of Appeals and, therefore, resolves to DENY the same.

First. As found by the Court of Appeals, the case, as shown by the allegations of the complaint, is for "collation of the properties comprising the estate of the deceased parents of the parties which under Section 19 (4) of B.P. 129 falls within the jurisdiction of the Regional Trial Court." The jurisdiction of the SEC under �5 of P.D. No. 902-A requires the concurrence of two (2) elements, namely: (1) the status or relationship of the parties; and (2) the nature of the question which is the subject of the controversy (Lozano v. De Los Santos, 274 SCRA 452 (1997). As to the first element, the controversy must pertain to any of the following relationships: (a) between corporation, partnership or association and the public; (b) between the corporation, partnership or association and its stockholders, partners, members or officers; (c) between the corporation, partnership or association and the state insofar as its franchise, permit or license to operate is concerned; and (d) among stockholders, partners or associates themselves (Tolentino v. Court of Appeals, 280 SCRA 226 (1997)). None of these relationships exists in the case at bar. The dispute between the parties cannot be considered as a dispute among stockholders since private respondents are precisely excluded by petitioners from their inheritance consisting of the investments in the two (2) corporations controlled by the petitioners. Strictly speaking, private respondents are not yet stockholders of the said corporations. Their right to inherit and their right to share in the ownership of the corporations are the matters to be resolved in the case pending in the trial court. This being the case, the jurisdiction over the dispute must be deemed vested in the regular courts (Limtay v. Court of Appeals, G.R. No. 126891, August 5, 1998). The fact that the estate in dispute involves investments in corporations does not convert a simple case for partition of estate into intracorporate dispute.

The second element, on the other hand, requires that the dispute be related to the regulation of the corporation, partnership or association. This is not the case here, either. The trial court thus correctly assumed jurisdiction over the case.

Second. Nor is the action for partition barred by res judicata because the prior extrajudicial settlement executed by the parties pertains to the disposition of their father's interest in Hagonoy Lumber only while the complaint refers to the partition of the entire estate of their deceased parents. The extrajudicial settlement is final only as to the disposition of the Hagonoy Lumber. But not as to the rest of the undivided estate of their deceased parents.

Very truly yours,

TOMASITA B. MAGAY-DRIS

Clerk of Court

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