Mr. Romeo A. Garcia vs. Jesus Manalo, et al.

[SEC-SICD * CASE NO. 4054. November 27, 1991.] MR. ROMEO A. GARCIA , petitioner , vs . JESUS MANALO, OSCAR ALBANO, ET AL. , respondents . D E C I S I O N In a verified petition, petitioner Mr. Romeo A. Garcia, a resident of Merryhomes II-B Subdivision, Camarin, Caloocan City, prayed for the following reliefs: "1. That pending determination of the propriety of the issuance of preliminary injunction, a temporary restraining order be issued restraining all respondent officers from performing the functions of the positions they were wrongly voted; 2. That after hearing, a preliminary injunction be issued and that a decision be rendered declaring the election of July 28, 1991, as null and void; and 3. Ordering the holding of another election for the selection of the eleven members of the Board of Trustees in accordance with the provisions of the Association's Articles of Incorporation and By-Laws and under the supervision of the Honorable Commission." Petitioner alleged inter alia, that he and respondents are all bonafide members of Merryhomes II-B Neighborhood Association, Inc.; that sometime in the first week of July 1991, in violation of the Association's By-Laws respondent Mr. Jesus Manalo announced through the Association's Bulletin Board, the election of officers of the Association scheduled on July 28, 1991, and required all interested members to file their Certificate of Candidacy with Mrs. Cory Jocson, the designated Chairperson of the Association's Commission on Elections (COMELEC); that subsequently thereafter, at about the third week of July 1991, respondent Jesus Manalo announced the replacement of Mrs. Cory Jocson as Chairperson by Respondent Mrs. Susan Luceno; that respondent Susan Luceno in her capacity as Chairperson, issued the following guidelines for the conduct of election only on July 26, 1991, to wit: a. That the election shall be by direct Vote; b. That Party System is allowed; c. That filing of Certificate of Candidacy shall not be later than 12:00 Noon of July 27, 1991. In the election of July 28, 1991, the following were elected as Officers of the Association: President Jesus Manalo Vice President Oscar Alabado Secretary Laarni Iscala Treasurer Lito Aguilar Auditor Ed Santos PRO Luis Velasco PRO Bobby Fortich Sgt-at-Arms Benjie Fernandez Sgt-at-Arms Jun Visayas Street Directors: Pol Jimenes Jess Mallinlin Dennis Canaya Lina Ulep Arnel Sequitin Bordones Ver Inocencio Bert Buco Boyet Chica That the election held on July 28, 1991, was a clear violation of Section 1, in relation to Section 6 of Article I of the By-laws of the Association which explicitly provides that, "the Election for the Board of Trustees shall coincide with the annual meeting of the Association on the last Sunday of December each year," that the procedures adopted in the July 28, 1991 election wherein the officers were elected by direct Vote clearly violates Articles III of the Association's By-Laws, which provides, that: ARTICLE III "SECTION 1. Officers . The Officers of the Association shall be a President, a Vice-President, a Secretary, a Treasurer and an Auditor. They shall be elected by the Board of Trustees from among themselves, The Board may combine compatible officer in a single person:" That the election of eleven (11) Trustees as explicitly required under Article 6 of Articles of Incorporation (Annex "B" hereof) was likewise not complied with. LibLex On August 12, 1991, petitioner manifested that he is no longer interested in pursuing his prayer for the issuance of a writ of preliminary injunction and therefore, withdraws the same for the immediate resolution of the main case. Respondents failed to file their answer within the reglementary period. Counsel for the petitioner filed an Ex-Parte Motion to submit the case for decision pursuant to Sec. 5 of the Summary Rules of Procedure in Election Contests. This Hearing Officer granted the motion in an Order dated September 2, 1991. Pending the resolution of this case, respondent Jesus Manalo by himself, filed a Motion to Dismiss dated September 23, 1991, alleging, inter alia: "1. Per Certification of the Home Insurance and Guaranty Corporation dated September 16, 1991, the Corporate files of Merryhomes II-B Neighborhood Association, Inc. has been transferred to said office by the Securities and Exchange Commission . . .; 2. Pursuant to the said Certification, it is the contention of the ( sic ) representation that it is the office of the Home Insurance and Guaranty Corporation that has now the jurisdiction over the case and not the Securities and Exchange Commission." It must be stressed that a motion to dismiss is one of the prohibited pleadings under the Summary Procedure in Election Cases, which provides: "SECTION 9. Prohibited Pleadings and Motion . The following pleadings, motions or petitions shall not be allowed: 1. Motion to Dismiss 2. . . . A perusal of the purposes for which this Association was formed, however, show that the association does not fall under the coverage of Executive Order No. 535, series of 1979. This is bolstered by the fact that certain purposes of the association were intentionally deleted to ensure that the corporation does not fall under the jurisdiction of the Home Insurance and Guaranty Corporation. In fact, Hon. Rosario N. Lopez, Chairman of the Securities and Exchange Commission (SEC for short) wrote the Home Insurance Guaranty Corporation (HIGC for short) to return to the Commission the corporate file of the subject association as it is the SEC which has jurisdiction over the said association. The HIGC, thru Ms. Aida A. Mendoza officer-in-charge of the Legal/HOA and Administrative Group, acknowledged their error in asking for the transmittal of the records as they believed that the said corporation was functioning as a homeowner's association, and returned the original corporate file to this Commission. It is indubitable, therefore, that we have jurisdiction over this case. It is a matter of record that respondents did not contradict any of the allegations of the petitioner. Clearly under Section 6 Article I of the Association's By-Laws, the Election of the Trustees for the ensuing year must be held at the annual meeting on the last Sunday of December of each year at the principal office of the association. It is apparent therefore, that the holding of the election last July 28, 1991 was contrary to the provisions of the by-laws of the corporation. Further, it appears that the procedure adopted during the said election wherein the officers were elected by direct vote was a clear violation of the provision of the by-laws of the association, particularly Article III, which expressly provides that, "the officers shall be elected by the Board of Trustees from among themselves." Moreover, the election of the eleven (11) Board of Trustees was not likewise complied with. WHEREFORE, judgment is hereby rendered, as follows: 1. Declaring the election of July 28, 1991 as null and void; 2. Respondents are hereby permanently enjoined from performing their functions as elected trustees and officers pursuant to the election last July 28, 1991; 3. Ordering the holding of another election for the eleven (11) members of the Board of Trustees pursuant to the by-laws of the association on December 29, 1991 under the supervision of this Commission. LexLib SO ORDERED. (SGD.) KIRTH S. BANSUELO Hearing Officer