SECOND DIVISION
[G.R. No. 228239. June 10, 2019.]
BANGKO SENTRAL NG PILIPINAS, petitioner, vs.BF HOMES, INCORPORATED, respondent.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, Second Division, issued a Resolution dated10 June 2019which reads as follows:
"G.R. No. 228239 — BANGKO SENTRAL NG PILIPINAS, petitioner, versus BF HOMES, INCORPORATED, respondent.
Before the Court is a Petition for Review 1 under Rule 45 of the Rules of Court filed by petitioner Bangko Sentral ng Pilipinas (BSP) assailing the Decision 2 dated May 12, 2016 and Resolution 3 dated November 7, 2016 of the Court of Appeals (CA) in CA-G.R. CV No. 102601. The CA set aside the Orders dated October 18, 2013 4 and February 27, 2014 5 of the Regional Trial Court (RTC), Branch 201, Las Piñas City in SCA No. 13-0016.
The Facts and Antecedent Proceedings
On August 23, 2013, BF Homes, Incorporated (BF Homes) filed a petition for declaratory relief and prohibition (the Petition) against BSP, Banco Filipino Savings and Mortgage Bank (Banco Filipino), the Philippine Deposit Insurance Corporation and the Ex-Officio Sheriff of RTC Las Piñas.
The Petition alleged that: (i) in 2002, Tierra Grande Farms, Inc. (Tierra Grande) obtained several loans from Banco Filipino and to secure the loan, Tierra Grande executed a Deed of Mortgage over BF Homes' properties by virtue of a special power of attorney issued by BF Homes in favor of Tierra Grande; (ii) on April 2, 2009, Banco Filipino, through its Board of Directors, applied for a Special Liquidity Facility Loan from BSP and as security thereof, delivered to BSP the alleged Deed of Assignment of Mortgage of its Credits over a Negotiable Promissory Note and their corresponding mortgages on real properties, including the properties in the name of BF Homes mortgaged by Tierra Grande to Banco Filipino; and (iii) on July 31, 2013, BF Homes found out that BSP applied for extrajudicial foreclosure and sale of real estate mortgage (REM) of its real properties mortgaged by Tierra Grande to Banco Filipino. 6
Accordingly, BF Homes prayed that the RTC make a declaration of its rights and duties under the Deed of Assignment of Mortgage between Banco Filipino and BSP and whether the property in the name of BF Homes mortgaged by Tierra Grande to Banco Filipino can be mortgaged by the latter to BSP. 7
On September 5, 2013, BSP filed a motion to dismiss ad cautelam, alleging that BF Homes had not authorized the filing of the Petition, it was not verified and it did not contain the requisite certification against forum shopping. 8 BSP maintained that the person authorized, namely Ma. Luwalhati C. Cruz (Cruz), to institute the Petition does not have the authority because the Secretary's Certificate 9 attached to the Petition states that Cruz is authorized "to represent the corporation in the case of BF Town Corporation v. Bangko Sentral ng Pilipinas, et al." 10 Said Secretary's Certificate was signed by Atty. Carmelo M. Mendoza (Atty. Mendoza), therein identified as the associate corporate secretary.
The relevant portion of the secretary's certificate authorizing Cruz to file the Petition reads:
RESOLVE as it is hereby resolved, that MA. LUWALHATI C. CRUZ and other associate lawyers be authorized, as it is hereby authorized, to represent the corporation in the case of BF TOWN CORPORATION VS. BANGKO SENTRAL NG PILIPINAS, ET AL. 11
For its part, BF Homes averred that the mention of BF Town Corporation in the secretary's certificate is a mere typographical error that should not be interpreted to mean that the corporation did not authorize the filing of the Petition. 12
In an Order 13 dated October 18, 2013, the RTC ordered the dismissal of the case for lack of authority to file the Petition. It ruled that in the absence of a valid authorization to sign the verification and certification against forum shopping, the Petition has no legal effect. The RTC explained as follows:
The Petitioner in this case is BF Homes, Incorporation and not BF Town Corporation, as correctly pointed out by the Bangko [S]entral ng Pilipinas in its Motion to Dismiss Ad Cautelam dated September 4, 2013, the complaint is not deemed filed and the unauthorized complaint does not produce any legal effect in view of the absence of such authority supposedly granted to Ma. Luwalhati Cruz.
Consequently, the absence of a valid authorization to sign the verification and certification against Forum-Shopping would make the instant petition of no legal effect. 14
On November 13, 2013, BF Homes filed a Motion for Reconsideration (MR)/Motion with Leave of Court to Amend Petition/Motion to Admit Amended Petition. BF Homes submitted that such typographical error was an excusable negligence, which it already rectified by filing an Amended Petition, and attaching thereto the revised Secretary's Certificate. 15 In an Order 16 dated February 27, 2014, the RTC denied the MR ruling that it did not specifically point out the error committed by the RTC.
Aggrieved, BF Homes filed an appeal with the CA. The CA reversed and set aside the Orders of the RTC. It held that BF Homes substantially complied with the requirements of verification and certification against forum shopping when it attached in its Amended Petition the revised Secretary's Certificate which now refers to BF Homes instead of BF Town Corporation. The CA ratiocinated as follows:
We note that in this case, there was already substantial compliance with the requirements of verification and certification against forum shopping when petitioner-appellant attached in its Motion for Reconsideration/Motion with Leave of Court to Amend Petition/Motion to Admit Amended Petition, the Secretary's Certificate showing the authority given by the Board of Directors of petitioner-appellant to Cruz to sign the verification and certification in the present case. 17
On June 6, 2016, BSP filed an MR with the CA. BSP claimed that while the CA points to the revised Secretary's Certificate attached to the Amended Petition, the subsequent attempt of BF Homes to comply with the rules should not have been considered by the CA as substantial compliance. BSP posited that "the new and differentSecretary's Certificate that was attached to respondent BF Homes' Motion for Reconsideration with Amended Petition was issued by someone who had no authority whatsoever to issue such a certificate." 18
In its Resolution 19 dated November 7, 2016, the CA denied BSP's MR ruling that all issues and arguments therein have already been passed upon in the assailed Decision.
Hence, this petition.
Issue
Whether the CA erred in ruling that there was substantial compliance by BF Homes as regards the requirements of verification and certification against forum shopping.
The Court's Ruling
The petition is meritorious.
Rule 7, Section 4 of the Rules of Court provides the requirement of verification, while Section 5 of the same Rule provides the requirement of certification against forum shopping. These sections state:
SEC. 4. Verification. — Except when otherwise specifically required by law or rule, pleadings need not be under oath, verified or accompanied by affidavit.
A pleading is verified by an affidavit that the affiant has read the pleading and that the allegations therein are true and correct of his personal knowledge or based on authentic records.
A pleading required to be verified which contains a verification based on "information and belief" or upon "knowledge, information and belief," or lacks a proper verification, shall be treated as an unsigned pleading. (Emphasis supplied)
SEC. 5. Certification against forum shopping. — The plaintiff or principal party shall certify under oath in the complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto and simultaneously filed therewith: (a) that he has not theretofore commenced any action or filed any claim involving the same issues in any court, tribunal or quasi-judicial agency and, to the best of his knowledge, no such other action or claim is pending therein; (b) if there is such other pending action or claim, a complete statement of the present status thereof; and (c) if he should thereafter learn that the same or similar action or claim has been filed or is pending, he shall report that fact within five (5) days therefrom to the court wherein his aforesaid complaint or initiatory pleading has been filed.
Failure to comply with the foregoing requirements shall not be curable by mere amendment of the complaint or other initiatory pleading but shall be cause for the dismissal of the case without prejudice, unless otherwise provided, upon motion and after hearing. The submission of a false certification or non-compliance with any of the undertakings therein shall constitute indirect contempt of court, without prejudice to the corresponding administrative and criminal actions. If the acts of the party or his counsel clearly constitute willful and deliberate forum shopping, the same shall be ground for summary dismissal with prejudice and shall constitute direct contempt, as well as a cause for administrative sanctions. (Emphasis supplied)
As a general rule, a pleading need not be verified, unless there is a law or rule specifically requiring the same. Since the Petition before the RTC prays that a writ of prohibition be issued commanding the Clerk of Court and Ex-Officio Sheriff of the RTC of Las Piñas to desist from conducting further proceedings in the foreclosure case, the Petition, as provided under Rule 65, 20 is required to be verified. That said, the requirement regarding verification of a pleading is formal, not jurisdictional. 21 Such requirement is simply a condition affecting the form of pleading, the non-compliance of which does not necessarily render the pleading fatally defective. 22 Verification is simply intended to secure an assurance that the allegations in the pleading are true and correct and not the product of the imagination or a matter of speculation, and that the pleading is filed in good faith. 23 The court may order the correction of the pleading if the verification is lacking or act on the pleading although it is not verified, if the attending circumstances are such that strict compliance with the rules may be dispensed with in order that the ends of justice may thereby be served. 24
On the other hand, the lack of certification against forum shopping is generally not curable by the submission thereof after the filing of the petition. 25 Section 5, Rule 45 of the Rules of Court provides that the failure of the petitioner to submit the required documents that should accompany the petition, including the certification against forum shopping, shall be sufficient ground for the dismissal thereof. 26The same rule applies to certifications against forum shopping signed by a person on behalf of a corporation which are unaccompanied by proof that said signatory is authorized to file a petition on behalf of the corporation. 27 Hence, even if the Court excuses the non-compliance as regards the requirement of verification, the issue of whether the certification against forum shopping is defective remains.
In the case at bar, it is undisputed that BF Homes is a corporation. A corporation has no power, except those expressly conferred on it by the Corporation Code 28 and those that are implied or incidental to its existence. 29 A corporation exercises said powers through its board of directors and/or its duly-authorized officers and agents. 30 Thus, it has been observed that the power of a corporation to sue and be sued in any court is lodged with the board of directors that exercises its corporate powers. In sum, physical acts of the corporation, like the signing of documents, can be performed only by natural persons duly authorized for the purpose by corporate by-laws or by a specific act of the board of directors. 31 It necessarily follows that "an individual corporate officer cannot solely exercise any corporate power pertaining to the corporation without authority from the board of directors." 32
The Corporation Code clearly enunciates that all corporate powers are exercised, all business conducted, and all properties controlled by the board of directors. 33 A corporation has a separate and distinct personality from its directors and officers and can only exercise its corporate powers through the board of directors. 34 Thus, it is clear that an individual corporate officer cannot solely exercise any corporate power pertaining to the corporation without authority from the board of directors. 35An officer or representative of the corporation can only validly sign the certification against forum shopping if he or she is authorized by the board of directors through a board resolution or secretary's certificate. 36
Accordingly, since BF Homes is a corporation, the certification against forum-shopping attached to its Petition filed with the RTC must be executed by an officer or member of the board of directors or by one who is duly authorized by a resolution of the board of directors; otherwise, such petition will have to be dismissed. Courts are not, after all, expected to take judicial notice of corporate board resolutions or a corporate officer's authority to represent a corporation. 37
The Court has repeatedly emphasized the need to abide by the Rules of Court and the procedural requirements it imposes. 38 The verification of a complaint and the attachment of a certificate of non-forum shopping are requirements that — as pointed out by the Court, time and again — basic, necessary and mandatory for procedural orderliness. 39
While the Court has excused strict compliance in the past, it did so only on sufficient and justifiable grounds that compelled a liberal approach while avoiding the effective negation of the intent of the rule on non-forum shopping. 40 In other words, the rule for the submission of a certificate of non-forum shopping, proper in form and substance, remains to be a strict and mandatory rule; any liberal application has to be justified by ample and sufficient reasons that maintain the integrity of, and do not detract from, the mandatory character of the rule. 41
To recall, the original secretary's certificate attached to the Petition, evidencing the authority of Cruz to file the Petition, refers to the case of BF Town Corporation v. Bangko Sentral ng Pilipinas, et al., and notBF Homes, Incorporated v. Bangko Sentral ng Pilipinas. As evidenced by their respective General Information Sheets (GIS), 42 BF Town Corporation is an entirely different corporation from BF Homes. Thus, the Court agrees with the RTC that the absence of a valid authorization to sign the verification and certification against forum shopping would make the Petition of no legal effect.
The Court is also not convinced that there was substantial compliance by BF Homes when it attached the revised secretary's certificate to its Amended Petition. A scrutiny of the 2013 GIS of BF Homes reveals that Atty. Mendoza is neither the corporate secretary nor associate corporate secretary of BF Homes. 43 Instead, Atty. Mendoza is the President/Chairman of BF Homes while Atty. Jose Luis V. Agcaoili and Atty. Ferdinand Raymund J. Navarro are the corporate secretary and associate corporate secretary, respectively. 44 Meanwhile, the 2013 GIS of BF Town Corporation shows that Atty. Mendoza is its corporate secretary. 45
Therefore, it is obvious that Atty. Mendoza was the corporate secretary of BF Town Corporation and not BF Homes. In other words, what had occurred was not a mere typographical error as BF Homes would want the Court to believe, but really the result of careless and reckless behavior resulting in the attaching of the wrong secretary's certificate to the Petition. The secretary's certificate must have been really intended for the case BF Town Corporation v. Bangko Sentral ng Pilipinas and was erroneously appended to the present Petition.
The revision of said secretary's certificate would have given BF Homes the opportunity for the Court to apply the rules of procedure liberally, but the Court was again prevented from doing so as BF Homes then committed another error by having Atty. Mendoza sign the revised secretary's certificate instead of Atty. Agcaoili and Atty. Navarro, the true corporate secretary and associate corporate secretary, respectively of BF Homes.
In sum, the acts of BF Homes are anything but excusable. Consequently, the Court holds that there can be no substantial compliance in the present case because the person who signed the secretary's certificate has no authority to issue and sign said secretary's certificate. The application of the rules must be the general rule, and the suspension or even mere relaxation of its application, is the exception. 46 This Court may go beyond the strict application of the rules only on exceptional cases when there is truly substantial compliance with the rule. 47
WHEREFORE, the petition for review is GRANTED. The Decision dated May 12, 2016 of the Court of Appeals in CA-G.R. CV No. 102601 is REVERSED and SET ASIDE. The Petition in SCA No. 13-0016 pending in the Regional Trial Court, Branch 201, Las Piñas City, is ordered DISMISSED.
SO ORDERED. (CARPIO, J., no part; JARDELEZA, J., designated additional Member per Raffle dated April 11, 2018; REYES, J., JR., J., on leave)"
Very truly yours,
(SGD.) MARIA LOURDES C. PERFECTODivision Clerk of Court
By:
TERESITA AQUINO TUAZONDeputy Division Clerk of Court
Footnotes
1.Rollo (Vol. 1), pp. 12-74, excluding Annexes.
2.Id. at 79-85. Penned by Associate Justice Ma. Luisa C. Quijano-Padilla and concurred in by Associate Justices Normandie B. Pizarro and Samuel H. Gaerlan.
3.Id. at 90-91.
4.Id. at 95-96. Penned by Judge Lorna Navarro Domingo.
5.Id. at 98-102.
6.Id. at 80.
7.Id.
8.Id.
9.Id. at 143.
10.Id. (Emphasis and underscoring supplied).
11.Id. at 143. (Emphasis and underscoring supplied).
12.Rollo (Vol. 2), p. 704.
13.Rollo (Vol. 1), pp. 95-96.
14.Id.
15.Rollo (Vol. 2), p. 717.
16.Rollo (Vol. 1), pp. 98-102.
17.Id. at 84-85.
18.Id. at 43.
19.Id. at 90-91.
20. SEC. 2. Petition for prohibition. — When the proceedings of any tribunal, corporation, board, officer or person, whether exercising judicial, quasi-judicial or ministerial functions, are without or in excess of its or his jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law, a person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered commanding the respondent to desist from further proceedings in the action or matter specified therein, or otherwise granting such incidental reliefs as law and justice may require. (Emphasis supplied)
21. Fuji Television Network, Inc. v. Espiritu, 749 Phil. 388, 405 (2014), citing Uy v. Land Bank of the Phils., 391 Phil. 303, 312 (2000).
22. Id. at 405, citing Uy v. Land Bank of the Phils., id. at 312.
23. Id., citing Uy v. Land Bank of the Phils., id.
24. Id., citing Uy v. Land Bank of the Phils., id.
25. Id., citing Shipside, Inc. v. Court of Appeals, 404 Phil. 981, 995 (2001).
26. Id., citing Shipside, Inc. v. Court of Appeals, id. at 995.
27. Id. at 405-406, citing Shipside, Inc. v. Court of Appeals, id.
28. The applicable law in this case is Batas Pambansa Blg. 68 or the Corporation Code of the Philippines.
29. Philippine Numismatic and Antiquarian Society v. Aquino, 804 Phil. 508, 517 (2017).
30. Id. at 517.
31. Id.
32. Id.
33. Id.
34. Id.
35. Id. at 517-518.
36. Societe Des Produits, Nestle, S.A. v. Puregold Price Club, Inc., G.R. No. 217194, September 6, 2017, 839 SCRA 177, 193.
37. Id. at 194-195, citing DBP v. Court of Appeals, 483 Phil. 216, 221 (2004).
38. Bank of the Philippine Islands v. Court of Appeals, 646 Phil. 617, 626 (2010).
39. Id. at 626.
40. Id.
41. Id.
42. Rollo (Vol. 1), pp. 329-341.
43. Id. at 331.
44. Id.
45. Id. at 339.
46. Philippine Numismatic and Antiquarian Society v. Aquino, supra note 29, at 518.
47. Id.