The Supreme Court held that the Court of Appeals (CA) committed grave abuse of discretion in ordering the execution pending appeal of the Regional Trial Court’s (RTC) Orders granting the petition to perpetuate the testimony of Juliette Gomez Romualdez. The Court emphasized that allowing the deposition would unfairly prejudice Romualdez and was essentially a fishing expedition by First Philippine Holdings Corporation (FPHC) without a solid legal basis. This decision reinforces the importance of protecting individuals from unwarranted legal processes and ensures that perpetuation of testimony is used judiciously, not as a tool for speculative litigation.

Unwarranted Inquiry: When a Widow’s Testimony Becomes a Fishing Expedition

This case revolves around two consolidated petitions concerning the perpetuation of testimony of Juliette Gomez Romualdez, the widow of Benjamin “Koko” Romualdez. First Philippine Holdings Corporation (FPHC) sought to perpetuate her testimony in relation to shares of stock in Philippine Commercial and Industrial Bank (PCIB), now Banco de Oro Unibank, Inc., which FPHC claimed were illegally sold to Trans Middle East (Phils.) Equities, Inc. (TMEE), allegedly as a dummy corporation for Benjamin Romualdez. The Presidential Commission on Good Government (PCGG) had sequestered these shares, deeming them ill-gotten wealth.

FPHC initially filed a complaint-in-intervention in a case before the Sandiganbayan, seeking to annul the sale of the PCIB shares. This complaint was dismissed due to prescription, a decision affirmed by the Supreme Court. Undeterred, FPHC filed a second complaint-in-intervention, which was also dismissed. While appealing this dismissal, FPHC filed a petition with the RTC to perpetuate Juliette Romualdez’s testimony, arguing her advanced age necessitated immediate action. The RTC granted the petition, and the CA upheld this decision, prompting Romualdez to file the petitions before the Supreme Court.

The Supreme Court addressed three key issues: whether the CA gravely abused its discretion in allowing the execution pending appeal, whether the RTC had jurisdiction over the petition, and whether the petition to perpetuate testimony had a valid basis. The Court found both petitions meritorious, siding with Romualdez on all counts. The Court emphasized the extraordinary nature of execution pending appeal, noting that it is generally disfavored due to its potential impact on parties’ rights before final adjudication. Such executions require a motion from the prevailing party, a good reason for the writ, and a special order stating that good reason.

The key here is that the reasons must constitute “superior circumstances demanding urgency which will outweigh the injury or damages should the losing party secure a reversal of the judgment.” In this case, the CA agreed with FPHC that Romualdez’s age and health justified immediate execution. However, the Supreme Court disagreed, finding that the CA had not adequately considered the context of FPHC’s prior failed attempts to litigate the matter and the lack of a clear cause of action. The Court noted that FPHC’s complaints-in-intervention had been denied twice by the Sandiganbayan due to prescription, and the first denial was affirmed by the Supreme Court.

The Court further pointed out that the PCIB shares were registered in the name of TMEE, not Benjamin Romualdez or his widow. The shares were no longer part of Civil Case No. 0035 after the dismissal of the complaint against TMEE. Therefore, Romualdez’s testimony would not be relevant to the case. The Supreme Court emphasized that FPHC’s insistence that the shares were ill-gotten wealth of Benjamin did not provide a sufficient basis to compel Romualdez’s testimony.

Even assuming the RTC had jurisdiction, the Supreme Court found that the petition to perpetuate Romualdez’s testimony lacked merit. The Court highlighted that FPHC had not adequately demonstrated how Romualdez possessed personal knowledge of the alleged fraudulent acquisition of the PCIB shares by TMEE. As the Court noted, to compel her testimony would likely involve examining communications received in confidence from her late husband, violating the marital privilege rule under Section 24, Rule 130 of the Rules of Court:

Section 24. Disqualification by reason of privileged communication. – The following persons cannot testify as to matters learned in confidence in the following cases:

(a) The husband or the wife, during or after the marriage, cannot be examined without the consent of the other as to any communication received in confidence by one from the other during the marriage except in a civil case by one against the other, or in a criminal case for a crime committed by one against the other or the latter’s direct descendants or ascendants;

Furthermore, the Court found that FPHC’s petition was a “classic form of fishing expedition.” FPHC admitted it needed Romualdez’s testimony to “safely and intelligently proceed to trial,” indicating a lack of evidence to support its claims. The Court also noted that the petition was a desperate attempt to find a friendly court to entertain FPHC’s narrative regarding the validity of the PCIB shares sale, despite prior dismissals and rulings against FPHC. In sum, the Supreme Court found that the Court of Appeals committed grave abuse of discretion in issuing the assailed Resolutions and that the petition for perpetuation of testimony lacked a valid basis.

FAQs

What was the key issue in this case?	The central issue was whether the Court of Appeals committed grave abuse of discretion in allowing the execution pending appeal of the RTC’s Orders granting the petition to perpetuate the testimony of Juliette Gomez Romualdez. The Supreme Court also considered whether the RTC had jurisdiction and if the petition had a valid basis.
What is perpetuation of testimony?	Perpetuation of testimony is a legal procedure that allows a party to take a deposition to preserve the testimony of a witness who may not be available at the time of trial. It is governed by Rule 24 of the Rules of Court.
Why did FPHC want to perpetuate Juliette Romualdez’s testimony?	FPHC claimed that Romualdez, as the widow of Benjamin Romualdez, had personal knowledge of the acquisition of PCIB shares, which FPHC alleged were fraudulently obtained by TMEE, a supposed dummy corporation for Benjamin Romualdez. FPHC argued her advanced age and health necessitated immediate testimony.
What is the marital privilege rule?	The marital privilege rule, as outlined in Section 24, Rule 130 of the Rules of Court, protects confidential communications between spouses during and after the marriage. It prevents one spouse from being examined without the other’s consent regarding such communications, with specific exceptions.
What does it mean for a petition to be a ‘fishing expedition’?	A ‘fishing expedition’ refers to a legal action where a party seeks information without a clear legal basis or probable cause, hoping to uncover something that might support their case. The Supreme Court found that FPHC was hoping to find something out from Juliette without any solid basis.
Why did the Supreme Court reverse the Court of Appeals’ decision?	The Supreme Court reversed the CA because it found that the CA had not adequately considered the prior dismissals of FPHC’s complaints, the lack of a clear cause of action, and the potential violation of the marital privilege rule. The Court determined that the execution pending appeal was unwarranted.
What was the significance of the PCIB shares being registered in TMEE’s name?	The fact that the PCIB shares were registered in TMEE’s name, not in Benjamin Romualdez’s name, was crucial because it weakened FPHC’s claim that the shares were part of Romualdez’s ill-gotten wealth. Additionally, TMEE was already cleared of any association.
What are the requirements for execution pending appeal?	The executions pending appeal require a motion from the prevailing party, a good reason for the writ, and a special order stating that good reason. Importantly, the reasons must constitute “superior circumstances demanding urgency which will outweigh the injury or damages should the losing party secure a reversal of the judgment.”

This Supreme Court decision serves as a reminder of the importance of due process and the need to prevent the misuse of legal procedures for speculative purposes. The ruling underscores that perpetuation of testimony should not be used as a tool for fishing expeditions and that courts must carefully scrutinize the basis for such petitions to protect individuals from unwarranted legal burdens.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Juliette Gomez Romualdez vs. The Court of Appeals, G.R. No. 230391, July 05, 2023