SECOND DIVISION
[G.R. Nos. 201140-42. June 30, 2021.]
PHILIPS FOODS CORPORATION, petitioner,vs. EDGAR L. TI and ELT ENTERPRISES, FIRST DISTRIBUTION SALES CORPORATION and JAMES ONG, respondents.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, Second Division, issued a Resolution dated30 June 2021which reads as follows:
"G.R. Nos. 201140-42 (PHILIPS FOODS CORPORATION v. EDGAR L. TI and ELT ENTERPRISES, FIRST DISTRIBUTION SALES CORPORATION and JAMES ONG). — When a case becomes moot and academic by virtue of supervening events, there is no more actual controversy between the parties, and no useful purpose can be served in resolving it upon the merits. 1 We apply this dictum in this Petition for Review on Certiorari, 2 which assails the July 28, 2011 Decision 3 and March 20, 2012 Resolution 4 of the Court of Appeals (CA) in CA-G.R. SP Nos. 104821, 104905 and 104973 that set aside the Regional Trial Court's (RTC's) issuance of a writ of preliminary injunction and declaration of default.
ANTECEDENTS
On November 14, 2003, Philips Foods Corporation (Philips Foods), represented by its vice president Philip G. Co (Co), assigned 22 registered trademarks that it uses for its canned products to ELT Enterprises, a single proprietorship owned by Edgar L. Ti (Ti). Afterwards, Edgar became the registered owner of the trademarks, and made the following transactions. First, on February 23, 2005, Ti, granted First Distribution Sales Corporation (First Distribution) the exclusive use of the trademarks for five years, which term was later extended for another two years. Second, on May 23, 2007, Ti assigned eight of the trademarks to James Ong (Ong). And, third, on May 25, 2007, Ti sold all the subject trademarks to Federated Distributors, Inc. (Federated Distributors). Ti's dealings with the trademarks were duly registered with the Intellectual Property Office. 5
On the premise that Co was not authorized to assign the trademarks to Ti, Philips Foods filed a complaint, with prayer for the issuance of a writ of preliminary injunction, 6 for the annulment of the assignment/sale of the trademarks to Ti as well as the subsequent transfers made to First Distribution, Ong, and Federate Distributors. 7 In an Order dated October 26, 2007, the RTC granted injunctive relief, and ruled that Philips Foods established a clear and unmistakable right over the subject trademarks, and giving it exclusive use of the marks while the case was pending, 8 thus:
WHEREFORE, finding the application to be sufficient in form and [in] substance, let a writ of preliminary injunction issue ordering defendants ELT Enterprises, Edgar L. Ti, First Distribution Sales Corporation, James Ong, Federated Distributors, Inc.[,] and all other persons acting for and[,] in their behalf, to refrain from registering with the Intellectual Property Office and/or from using any or all of the subject trademarks until after the final resolution of this case. ETHIDa
Plaintiff Philips is allowed to use the trademarks, to protect and safeguard the same during the pendency of this case and to post a bond in the amount of two million pesos (Php2,000,000.00) conditioned on its paying the defendants any damage they may suffer by reason of the injunction if this Honorable Court should finally decide that plaintiff Philip was not entitled thereto.
SO ORDERED. 9 (Emphases supplied)
Aggrieved, Ti, ELT Enterprises, First Distribution, Ong, and Federated Distributors (respondents) filed a motion for reconsideration. In the meantime, the RTC, in its March 6, 2008 Order, declared Ong and First Distribution in default for their failure to file their respective pre-trial briefs. In turn, Ong and First Distribution sought reconsideration. On June 26, 2008, the RTC denied both motions. 10
Consequently, respondents filed three (3) separate petitions for certiorari with the CA, docketed as CA-G.R. SP Nos. 104821 — filed by James Ong, 104905 — filed by Ti and ELT Enterprises, and 104973 — filed by First Distribution, questioning the issuance of a writ of preliminary injunction on the ground that Ti is indisputably the registered owner of the trademarks. In addition, Ong and First Distribution claimed that their failure to file pre-trial briefs should be excused because their counsel was assaulted and sustained 11 gunshot wounds a day before the scheduled pre-trial conference. 11
On May 31, 2010, the RTC rendered a Decision 12 in favor of Philips Foods. Philips Foods was adjudged to the owners of the trademarks. Co could not have validly assigned the marks to Ti, and in the same way, Ti's subsequent transactions were ineffective, thus:
IN LIGHT OF THE FOREGOING, the Assignment of Marks between Philip G. Co and defendants ELT/Edgar L. Ti is declared VOID AB INITIO lacking consideration and corporate consent of PHILIPS. The Deed of Sale of Marks between ELT/Edgar L. Ti and FDI is valid with the latter in good faith but with no right transmitted. The subject marks are hereby declared to remain with PHILIPS with defendants ELT/Edgar L. Ti is directed to return the P300,000.00 payment.
Likewise, defendants are hereby ordered to pay the plaintiff jointly and/or solidarily attorney's fees in the amount of Two Hundred Thousand Pesos (Php200,000.00).
SO ORDERED. 13
Apparently unaware of the RTC's resolution of the main case, the CA granted the consolidated petitions and nullified the Orders dated October 26, 2007, March 6, 2008, and June 26, 2008 of the RTC. 14 The Writ of Preliminary Injunction was dissolved, viz.:
WHEREFORE, premises considered, the three consolidated petitions are GRANTED. The assailed orders dated October 26, 2007, March 6, 2008, and June 26, 2008 of the Regional Trial Court of Pasay City, Branch 117 are NULLIFIED and SET ASIDE. Accordingly, the writ of preliminary injunction dated November 14, 2007 is declared VOID and is ordered DISSOLVED.
SO ORDERED. 15
The CA ratiocinated that the issuance of the writ of preliminary injunction was erroneous because under Sections 122 16 in relation to 138 17 of the Intellectual Property Code, the registration of the trademarks under Ti's name is prima facie proof of his ownership of the trademarks. Conversely, Philips Foods not being the registered owner, failed to establish an existing right. Anent the declaration of default, it was erroneous for the RTC to declare Ong and First Distribution in default because under Rule 18 of the Rules of Court, the consequence of the defendant's failure to file a pre-trial is that the plaintiff may proceed with the presentation of his evidence ex parte. There was substantial compliance on the part of Ong and First Distribution considering that they had subsequently filed their pre-trial briefs.
Philips Foods moved for reconsideration, 18 and asserted that the issue on the propriety of the issuance of the preliminary injunction has been mooted by the RTC's Decision dated May 31, 2010, which resolved the complaint on its merits. Moreover, the declaration of Ong and First Distribution in default has no practical value since they were able to present evidence through Ti, ELT Enterprises, and Federated Distributors. In a Resolution 19 dated March 20, 2012, the CA denied Philips Foods' motion, and ruled that it has the power to lift a writ of preliminary injunction when the circumstances warrant it. In addition, it remains that Ong and First Distribution were deprived of their day in court.
Hence, this petition. 20
Philips Foods asserts that it had an existing right because it remained to be the true owner of the trademarks considering that the assignment to Ti is invalid. Also, Ong and First Distribution's failure to submit their pre-trial briefs is inexcusable since it should have been made days prior to the scheduled pre-trial and before the assault on their counsel happened. On the other hand, respondents simply echo the findings of the CA and assert that it did not make any reversible error. 21
THIS COURT'S RULING
We dismiss the petition for having become moot and academic. cSEDTC
In Peñafrancia Sugar Mill, Inc. v. Sugar Regulatory Administration, 22 we explained the rationale for the abstention of the courts on matters which have become moot and academic:
A case or issue is considered moot and academic when it ceases to present a justiciable controversy by virtue of supervening events, so that an adjudication of the case or a declaration on the issue would be of no practical value or use. In such instance, there is no actual substantial relief which a petitioner would be entitled to, and which would be negated by the dismissal of the petition. Courts generally decline jurisdiction over such case or dismiss it on the ground of mootness. This is because the judgment will not serve any useful purpose or have any practical legal effect because, in the nature of things, it cannot be enforced. 23 (Emphasis supplied; citation omitted.)
Both issues raised in this petition have long been mooted by the RTC's May 31, 2010 Decision. In resolving the complaint, the RTC confirmed Philips Foods' ownership over the subject trademarks and rendered the preliminary injunction permanent. Thus, the issue on the propriety of the issuance of the preliminary injunction has obviously become moot and academic. In Kho v. Court of Appeals, 24 the Court explicitly ruled that "the issuance of a final injunction renders any question on the preliminary injunctive order moot and academic although the decision granting a final injunction is pending appeal." 25
Similarly, since the RTC has already passed upon the merits of the main case, all irregularities in the conduct of the proceedings such as the declaration of default can no longer be passed upon in a petition for certiorari, and instead, should be assigned as error on appeal. 26 In this regard, the CA should have reconsidered its decision and dismissed respondents' petition upon notice of the RTC's decision.
Considering the foregoing, we find it appropriate to abstain from passing upon the merits of the case where legal relief is no longer necessary nor called for. While the Court may pass upon issues albeit supervening events had rendered the petition moot and academic, the Court does so only when there is grave violation of the Constitution; when the exceptional character of the situation and paramount public interest is involved; when the constitutional issue raised requires formulation of controlling principles to guide the bench, the bar, and the public; or when the case is capable of repetition yet evading review. 27 We do not find such circumstances in this case.
WHEREFORE, the Petition is DISMISSED.
SO ORDERED." (Lopez, J.Y., J., designated additional Member per Special Order No. 2822 dated April 7, 2021.)
By authority of the Court:
(SGD.) TERESITA AQUINO TUAZONDivision Clerk of Court
Footnotes
1.Stradcom Corporation v. Hon. Laqui, 658 Phil. 37, 46 (2012).
2. Filed under Rule 45 of the Rules of Court.
3.Rollo, pp. 23-38; Penned by Associate Justice Amelita G. Tolentino with the concurrence of Associate Justices Normandie B. Pizarro and Rodil V. Zalameda (now a member of the Court).
4.Id. at 40-45; Penned by Associate Justice Amelita G. Tolentino with the concurrence of Associate Justices Normandie B. Pizarro and Rodil V. Zalameda (now a member of the Court).
5.Id. at 24-26, 33.
6. Docketed as Civil Case No. 07-01128 CFM.
7.Rollo, pp. 26-27.
8.Id. at 27.
9.Id. at 27.
10.Id. at 27-28.
11.Id. at 28-30.
12.Id. at 195-200.
13.Id. at 195-200.
14.Id. at 23-38. Decision dated July 28, 2011.
15.Id. at 38.
16. SECTION 122. How Marks are Acquired. — The rights in a mark shall be acquired through registration made validly in accordance with the provisions of this law.
17. SECTION 138. Certificates of Registration. — A certificate of registration of a mark shall be prima facie evidence of the validity of the registration, the registrant's ownership of the mark, and of the registrant's exclusive right to use the same in connection with the goods or services and those that are related thereto specified in the certificate.
18.Rollo, pp. 188-192, Motion for Reconsideration dated August 19, 2011.
19.Id. at 40-45. The CA disposed as follows:
WHEREFORE, premises considered, the instant motion for reconsideration is DENIED for lack of merit.
SO ORDERED.
20.Id. at 3-18, Petition for Certiorari dated April 10, 2012.
21.Id. at 234-252, 258-266, 276-302.
22. 728 Phil. 535 (2014).
23.Id. at 540.
24. 429 Phil. 140 (2002).
25.Id. at 152.
26.Villamar-Sandoval v. Cailipan, 705 Phil. 312 (2013).
27.The Philippine Ports Authority v. Coalition of PPA Officers and Employees, 767 Phil. 792, 803 (2015).