FIRST PHILIPPINE HOLDINGS CORPORATION V TRANS MIDDLE EAST

EQUITIES INC.
G.R. NO. 179505, 04 DECEMBER 2009
FACTS:
FHPC formerly known as Meralco Securities Corporation incorporated on 30 June
1961 by Filipino Entreprenuers led by Eugenio Lopez Sr. sold its 6,299,179.00 php shares of
common stock in Philippine Commercial International Bank (PCIB), now Equitable PCIB to
TMEE. Such shares according to the FHPC were obtained by the TMEE through fraud, acts
contrary to Law, Morals, Good Customs and Public Policy and such acquisition is either
voidable, void or un forceable. FHPC filed then its motion for leave to intervene and admit
complaint in intervention and was granted by the court. On the otehr hand, TMEE filed its
motion to dismiss the complaint-in-intervention by the FHPC on the ground that the action of
FHPC has already prescribed under Article 1391 of the Civil Code. Since the action was filed
only on 28 December 1988 and the sale was 24 May 1984 the action was laready 7 months late
from the date of prescription.
ISSUE :
Whether or not the sale of property is void and the prescriptive period had elapsed.
HELD:
No, the SC found that the sale is not void for a suit for the annulment of voidbale
contract on account of fraud shall be filed within four years from the discovery of the same, here,
from the time the questioned sale transaction on May 24, 1984 took place, FHPC didn't deny that
it had actual knowledge of the same. Simply, petitioner was fully aware of the sale of the PCIB
shares to TMEE and espite full knowledge petitioners did not question the said sale from its
inception and sometime thereafter. it was only four years and seven months had elapsed
following the knowledge or discovery of the alleged fraudulent sale that the petitioner assailed
the same, by then it was too late for the petitioners to beset same transaction, since the
prescriptive period had already come into play.
The SC therefore denied the instant petition and affirmed the resolution of the SB with
cost against the petitioner.