It is true that a criminal case can only be filed against the officers of a corporation and not against the corporation itself. It does not follow from this, however, that the corporation cannot be a real-party-in-interest for the purpose of bringing a civil action for malicious prosecution.
FACTS:
Petitioner State Investment Trust, Inc extended loans in various amounts to Guevent Industrial Development Corp which the latter failed to pay on the dates they became due. For this reason, a rehabilitation plan was agreed upon for GIDC under which it mortgaged several parcels of land to petitioner SITI. Among those mortgaged was a Mandaluyong lot. However, GIDC again defaulted. Hence, SITI foreclosed the mortgages and, in the foreclosure sale, acquired the properties as highest bidder.
Alleging irregularities in the foreclosure of the mortgages and the sale of properties to SITI, GIDC filed a case in the RTC Pasig. The case was eventually settled through a compromise agreement which became the basis of the trial courts judgment. A dispute later arose concerning the interpretation of the compromise agreement, as respondent Honeycomb Builders, Inc. offered to purchase from GIDC the lot and the latter agreed but SITI (the mortgagee) refused to give its consent to the sale and release its lien on the property. For this reason, GIDC asked the trial court for a clarification of its decision.
Subsequently, the trial court directed SITI to accept the offer of HBI to purchase the property. SITI appealed the order to the Court of Appeals which affirmed the same.
HBI applied to the Housing and Land Use Regulatory Board for a permit to develop the property in question. Its application was granted, on account of which HBI built a condominium. When HBI applied for a license to sell the condominium units it was required by the HLURB to submit an Affidavit of Undertaking which in effect stated that the mortgagee (SITI) of the property to be developed agrees to release the mortgage on the said property as soon as the full purchase price of the same is paid by the buyer. Respondent HBI submitted the required affidavit.
Petitioner Cometa as president of SITI denied as supported by NBI finding Cometa’s signature to be a forgery on the basis of which a complaint for falsification of public document was filed against HBI president Guevara. Following the dismissal of the criminal case against him, private respondents Reynaldo S. Guevara and HBI filed a complaint for malicious prosecution against petitioners Cometa and SITI.
ISSUE:
WON the complaint filed by private respondents against petitioners in the Regional Trial Court states a cause of action.
HELD:
NO. the decision of the criminal court in the present case indicates that there was not even prima facie evidence to prove the alleged guilt of the accused. Consequently, a trial was in fact unnecessary and the criminal court dismissed the case against private respondent Guevara on the basis of a demurrer to evidence. Lack of probable cause is an element separate and distinct from that of malice. It follows, therefore, that one cannot be held liable in damages for maliciously instituting a prosecution where he acted with probable cause.
It is contended that HBI is not a real-party-in-interest, whatever interest it may have being purely speculative. On this point, we think the Court of Appeals correctly ruled:
Section 11 of Rule 3 of the Rules of Court provides:
HELD:
NO. the decision of the criminal court in the present case indicates that there was not even prima facie evidence to prove the alleged guilt of the accused. Consequently, a trial was in fact unnecessary and the criminal court dismissed the case against private respondent Guevara on the basis of a demurrer to evidence. Lack of probable cause is an element separate and distinct from that of malice. It follows, therefore, that one cannot be held liable in damages for maliciously instituting a prosecution where he acted with probable cause.
It is contended that HBI is not a real-party-in-interest, whatever interest it may have being purely speculative. On this point, we think the Court of Appeals correctly ruled:
Section 11 of Rule 3 of the Rules of Court provides:
Misjoinder and non-joinder of parties. Misjoinder of parties is not a ground for dismissal of an action. Parties may be dropped or added by order of the court or on motion of any party or on its own initiative at any stage of the action and on such terms as are just.
Given (1) the foregoing rule, (2), the fact that Guevara, in his capacity as president of HBI, filed HBIs application to sell at the HLURB and it was in the same capacity and in connection with the application that he was criminally charged, and (3) the allegations in the complaint including that stating that by the filing of the criminal case against Guevara, the application of HBI with the HLURB for a regular license to sell the condominium units . . . had been delayed, resulting in the corresponding delay in the sale thereof on account of which plaintiffs incurred over runs in development, marketing and financial costs and charges, resulting in actual damages, the deferral by public respondent of petitioners motion to drop HBI as party plaintiff cannot be said to have been attended with grave abuse of discretion. It bears emphasis that the phraseology of Section 11 of Rule 3 is that parties may be dropped . . . at any stage of the action.
It is true that a criminal case can only be filed against the officers of a corporation and not against the corporation itself. It does not follow from this, however, that the corporation cannot be a real-party-in-interest for the purpose of bringing a civil action for malicious prosecution.
Lastly, the statement of the judge in the assailed order of May 30, 1994 that [t]he defense of lack of cause of action and that the defendants are not the real parties in interest .... are matters of defense was correctly held by the appellate court as mere dictum, said judge having earlier stated in the same order that there are sufficient allegations of causes of action in the Complaint.
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