Florencio Orendain v. BF Homes (G.R. No. 146313)


Respondent BF Homes, a domestic corporation involved in developing and selling residential lots filed a petition for rehabilitation and suspension of payments as it incurred liabilities in the course of its operations. SEC ordered the appointment of a rehabilitation receiver with herein petitioner Orendain as its Chairman. Sometime later, BF Homes represented by petitioner Orendain sold a parcel of land to the Local Superior of the Franciscan Sisters of the Immaculate Phils. Inc (LSFSIPI). SEC ordered a new committee of receivers and relieved petitioner of its duties. BF Homes then filed before the court an action for reconveyance of the property sold to LSFSIPI alleging petitioner acted in its individual capacity and therefore had no title over the property. Petitioner argues RTC had no jurisdiction over the case since BF Homes’ suit was instituted against him as its former receiver. The trial court and CA found for BF Homes.


Whether or not the reconveyance suit involves intra-corporate dispute cognizable by SEC.

Ruling: NO.

Clearly, the controversy involves matters purely civil in character and is beyond the ambit of the limited jurisdiction of the SEC.

Section 5 of PD No. 902-A does not apply in the instant case. The LSFSIPI is neither an officer nor a stockholder of BF Homes, and this case does not involve intra-corporate proceedings. In addition, the seller, petitioner Orendain, is being sued in his individual capacity for the unauthorized sale of the property in controversy. Hence, we find no cogent reason to sustain petitioner’s manifestation that the resolution of the instant controversy depends on the ratification by the SEC of the acts of its agent or the receiver because the act of Orendain was allegedly not within the scope of his authority as receiver. Furthermore, the determination of the validity of the sale to LSFSIPI will necessitate the application of the provisions of the Civil Code on obligations and contracts, agency, and other pertinent provisions. In addition, jurisdiction over the case for reconveyance is clearly vested in the RTC as provided in paragraph (2), Section 19, B.P. Blg. 129.


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