GR 102355; (May, 1994) (Digest)
G.R. No. 102355 May 31, 1994
MANILA ELECTRIC COMPANY, petitioner, vs. The Honorable SANDIGANBAYAN, PHILIPPINE COMMISSION ON GOOD GOVERNMENT and SINING MAKULAY, INC., respondents.
FACTS
Petitioner Manila Electric Company (MERALCO) and private respondent Sining Makulay, Inc. (SMI) entered into a Joint Pole Agreement on January 26, 1979, wherein MERALCO leased specific spaces on its distribution poles to SMI for its Community Antenna Television Service (CATV) at a rental rate. MERALCO later discovered that SMI was also using the poles for cables providing computer data channels to banking institutions, a practice MERALCO considered a violation of their agreement. MERALCO advised SMI of the violation, served a notice of termination, and demanded removal of SMI’s attachments. Meanwhile, the government filed Civil Case No. 0034 before the Sandiganbayan for the recovery of alleged ill-gotten wealth, and SMI was placed under sequestration as a company allegedly owned by defendant Roberto Benedicto. SMI filed an “Urgent Motion for Preliminary Injunction” in Civil Case No. 0034, praying that MERALCO be enjoined from withholding the use of the poles. MERALCO opposed, alleging the Sandiganbayan lacked jurisdiction over it and the subject matter. The Sandiganbayan ruled it had jurisdiction. Subsequently, a Compromise Agreement was approved in Civil Case No. 0034 between the Republic and Roberto Benedicto, which included the lifting of sequestration over SMI.
ISSUE
1. Whether the Sandiganbayan acquired jurisdiction over petitioner MERALCO.
2. Whether the Sandiganbayan had jurisdiction over the subject matter of the motion.
3. Whether the Compromise Agreement in Civil Case No. 0034 rendered the instant petition moot and academic.
RULING
The petition was dismissed for being moot and academic. The questioned resolution of the Sandiganbayan was set aside for having become functus oficio. Initially, the Sandiganbayan correctly held it had jurisdiction over the incident because SMI was a sequestered corporation, and under Executive Order No. 14, the Sandiganbayan has exclusive and original jurisdiction over all incidents arising from, incidental to, or related to cases filed by the PCGG regarding ill-gotten wealth. However, with the approval of the Compromise Agreement in Civil Case No. 0034, which lifted the sequestration over SMI and recognized its private ownership, the situation changed. SMI was no longer under sequestration, and the contractual dispute between MERALCO and SMI became a purely private matter that would not cause prejudice to the government or the defendants in Civil Case No. 0034. The Compromise Agreement, having the effect of res judicata, superseded the assailed resolution. Therefore, the issue of the Sandiganbayan’s jurisdiction was rendered moot.