G.R. No. 207435 , July 1, 2015
NORMA EDITA R. DY SUN-ONG, Petitioner, vs. JOSE VICTORY R. DY SUN, Respondent.

FACTS

Petitioner Norma Edita R. Dy Sun-Ong filed a Complaint for Delivery of Shares including Dividends Due Thereon in Yakult Philippines, Inc., and Damages against her brother, respondent Jose Victory R. Dy Sun. She alleged that respondent held in trust 90,848,000 shares of Yakult Philippines, Inc. (YPI) belonging to the heirs of the late Don Vicente Dy Sun, Sr., and that 18,169,600 of these shares belonged to her. A written demand for delivery was made on March 23, 2010, but respondent did not reply. Respondent filed a Motion to Dismiss on grounds including lack of jurisdiction due to incorrect docket fees, failure to state a cause of action, prescription, and laches. The Regional Trial Court (RTC) denied the motion to dismiss and a subsequent supplemental motion, ruling that issues like prescription and laches required a full trial on the merits. The RTC also found the docket fees paid were correct based on the par value of the shares alleged. The Court of Appeals (CA) reversed the RTC, granting respondent’s petition for certiorari and dismissing the complaint on the grounds of prescription and laches. The CA held that the complaint’s allegations showed the shares were transferred in trust prior to the father’s death in December 1988, and the demand was made only in March 2010, after about 22 years, thus the action had prescribed and was barred by laches.

ISSUE

The primary issues are: (1) Whether the action for the recovery of shares based on an implied trust has prescribed or is barred by laches; and (2) Whether the Court of Appeals erred in entertaining the petition for certiorari.

RULING

The Supreme Court ruled that the petition has merit and remanded the case to the RTC for trial on the merits. The Court held that prescription and laches could not be determined solely from the face of the complaint. The existence of an implied trust, which prescribes in 10 years from its repudiation, and the timing of such repudiation, are factual matters requiring a trial. The Court noted that respondent’s letter dated October 23, 2006, attached to his motion to dismiss, could constitute a repudiation of the trust. Counting from 2006, the complaint filed in 2010 was within the 10-year prescriptive period. Furthermore, laches, being an equitable doctrine, depends on the circumstances and also requires factual determination. Regarding the propriety of certiorari, the Court found that the RTC did not commit grave abuse of discretion in denying the motion to dismiss, as its order was based on a perceived need for a trial, making certiorari an improper remedy. The CA therefore overstepped its jurisdiction in granting the petition.