University of the Philippines College of Law

Topic Injunction as Provisional Remedy

Case Name Pineda v Lantin
Ponente Regala, j.

RELEVANT FACTS
1. In a complaint-letter to the SEC, 2 minority stockholders of the respondent corporation Bacolod-
Murcia Milling Co (BMMC) complained of violations of the Articles of Incorporation, corporation
law and SEC rules and regulations committed by the resp. corp and its President and GM Amado
Araneta.
2. Petitioner Mariano Pineda, in his official capacity as SEC Commissioner ordered the investigation.
3. The designated investigators addressed a subpoena duces tecum to Araneta and to the treasurer
and secretary of BMMC.
4. R: filed Petition to Reconsider Order and to Set Aside Subpoena Duces Tecum.
 Argued that with the approval of RA 1443, the power given by law to SEC to conduct
investigations has been qualified and made subject to conditions in accordance with the
rules adopted by SEC. However, there are no such rules yet hence it could no proceed
with the investigation.
5. P: DENIED the petition
6. R: filed Motion to Quash and Discontinue Entire Proceedings wherein they just reiterated their
earlier contentions.
7. P: DENIED the motion
8. R: filed Special Civil Action for Prohibition before the CFI of Manila against the investigators
and the complainants.
9. P: filed Motion to Dismiss
 The writ prayed for would amount to a review, modification or setting aside of an SE order
which is beyond the jurisdiction of CFI and which only SC could do so.
10. Judge Lantin: deferred resolution of the motion until trial of the case on the merits
11. P: filed Answer; their MTD was then denied.
12. P: motion for reconsideration -> DENIED
13. P: filed petition for certiorari with prohibition and preliminary injunction before the SC

Respondents’ argument:
1. The principal purpose of their action in the lower court was not to have an order of the SEC
reviewed but to have the investigation stopped because of an alleged lack of jurisdiction to
proceed with the same. Therefor Rule 43 Sec 1 and CA 83 Sec 35 do not apply.
2. The questioned order is merely interlocutory, thus they cannot have come to the SC under Sec 1
of Rule 43 because the said provision refers only to final orders and decisions.

ISSUE AND RATIO DECIDENDI

Issue Ratio
W/N CFI may enjoin the SEC NO. CFI has no jurisdiction to grant injunctive reliefs against the
SEC. That power is lodged exclusively with the SC.

Applicable laws:
Rule 43 Sec 1: Petition for review.—Within thirty days from notice of an
order or decision issued by the Public Service Commission or the
Securities and Exchange Commission, any party aggrieved thereby may
University of the Philippines College of Law
file, in the Supreme Court, a written petition for the review of such order
or decision.

CA 83 Sec 35: Court review or orders.—(a) Any person aggrieved by an

order issued by the commission in any proceeding under this Act to which
such person is a party or who may be affected thereby may obtain a
review of such order in the Supreme Court of the Philippines by filing in
such Court within thirty days after the entry of such order a written petition
praying that the order of the Commission be modified or set aside in
whole or in part. x x x.

Hence, whenever a party is aggrieved by or disagrees with an order

or ruling of the SEC, his remedy is to come to the SC in a petition
for review. Only SC possesses the jurisdiction to review or pass
upon the legality or correctness of any order or decision of the SEC,
and, as circumstances might warrant, to modify, reverse, or, set
aside the same.

RE: respondents’ argument #1 – no weight

Upon thorough reading of their petition for prohibition filed before the
lower court, SC found that the main aim was to have the order of the
SEC reviewed (order pertaining to the denial of their motion to quash
and discontinue the proceeding). The said petition was also meant to
have the order of SEC to be ultimately set aside.

Even assuming that the principal concern of BMMC in filing the action
below was indeed to stop the investigation so that the jurisdiction of the
investigating body to conduct the same might first be determined, SC
held that this action should be commenced before the SC.
 Since the orders of SEC are reviewable only by the SC, the Rules
could not possibly have excluded the review of incidental orders
such as in this case.

RE: respondents’ argument #2 – no force nor merit

As held in San Beda v CIR
GR: interlocutory orders are not appealable
EXC: when it is grounded upon lack of jurisdiction

RE: rational of the rule as regards the review of the orders of SEC
Being charged with overseeing the operations of those various corporate
enterprises from which our government derives great revenues and
income, it cannot afford to be impeded or restrained in the performance
of its functions by writs of injunction emanating from tribunals
subordinate to the SC.

If every CFI can enjoin the SEC from pursuing its objectives, and, in the
premises, substitute its judgment for that of the SEC on what should or
should not be done, then, the economy and, eventually, this country’s
citizenry will suffer. The legislature could never have intended that.