Tan v. Bausch (Case Digest. G.R. No.148420)

CASE DIGEST: [G.R. No.148420 December 15, 2005] ANDREA TAN, CLARITA LLAMAS, VICTOR ESPINA and LUISA ESPINA, Petitioners, v. BAUSCH & LOMB, INC., Respondent. CORONA, J.:

FACTS: On April 8, 1997, an information for violation of paragraph 1, Article 189 6 of the Revised Penal Code (RPC) was filed before Branch 21, RTC, Cebu City against petitioners Andrea Tan, Clarita Llamas, Victor Espina and Luisa Espina of Best Buy Mart, Inc.

On January 21, 1998, respondent filed a motion to transfer the case to Branch 9, RTC, Cebu City. Administrative Order No. 113-958 (A.O. No. 113-95) designated the said branch as the special court in Region VII to handle violations of intellectual property rights.

On March 2, 1998, petitioners filed a motion to quash the information on the ground that the RTC had no jurisdiction over the offense charged against them. The penalty provided by the RPC for the crime was within the jurisdiction of the Municipal Trial Court in Cities (MTCC).

On December 22, 1998, the court a quo denied respondent's motion to transfer the case and granted petitioners' motion to quash


HELD: There is no merit in the petition.

The only relevant issue left for our resolution is whether or not the jurisdiction over the crime allegedly committed by petitioners is vested on the RTC.

Section 5 (5) of the 1987 Constitution empowers the Supreme Court to promulgate rules concerning pleading, practice and procedure in all courts. The limitations to this rule-making power are the following: the rules must (a) provide a simplified and inexpensive procedure for the speedy disposition of cases; (b) be uniform for all courts of the same grade and (c) not diminish, increase or modify substantive rights.23 As long as these limits are met, the argument used by petitioners that the Supreme Court, through A.O. Nos. 113-95 and 104-96, transgressed on Congress' sole power to legislate, cannot be sustained.

A.O. No. 113-95 designated special intellectual property courts to promote the efficient administration of justice and to ensure the speedy disposition of intellectual property cases.

A.O. No. 104-96,24 on the other hand, was issued pursuant to Section 23 of BP 129 which transferred the jurisdiction over such crimes from the MTC and MTCC to the RTC and which furthermore gave the Supreme Court the authority to designate certain branches of the RTC to exclusively handle special cases in the interest of the speedy and efficient administration of justice. Accordingly, the RTC was vested with the exclusive and original jurisdiction to try and decide intellectual property cases.

The transfer of jurisdiction from the MTC and MTCC to the RTC did not in any way affect the substantive rights of petitioners. The administrative orders did not change the definition or scope of the crime of unfair competition with which petitioners were charged.

Both administrative orders therefore have the force and effect of law, having been validly issued by the Supreme Court in the exercise of its constitutional rule-making power. The trial court, being a subordinate court, should have followed the mandate of the later A.O. 104-96 which vested jurisdiction over the instant case on the RTC. Thus, the appellate court correctly found that the court a quo committed grave abuse of discretion.

Furthermore, the order of the trial court was a patent nullity. In resolving the pending incidents of the motion to transfer and motion to quash, the trial court should not have allowed petitioners to collaterally attack the validity of A.O. Nos. 113-95 and 104-96. We have ruled time and again that the constitutionality or validity of laws, orders, or such other rules with the force of law cannot be attacked collaterally. There is a legal presumption of validity of these laws and rules. Unless a law or rule is annulled in a direct proceeding, the legal presumption of its validity stands. The trial court's order was consequently null and void.

The transfer of this case to Branch 9, RTC, Cebu City, however, is no longer possible. A.M. No. 03-03-03-SC27 consolidated the intellectual property courts and commercial SEC courts in one RTC branch in a particular locality to streamline the court structure and to promote expediency. The RTC branch so designated will try and decide cases involving violations of intellectual property rights, and cases formerly cognizable by the Securities and Exchange Commission. It is now called a special commercial court. In Region VII, the designated special commercial court is Branch 11, RTC, Cebu City. The transfer of this case to that court is therefore warranted.Endnotes:

1 Under Rule 45 of the Revised Rules of Court.

2 Penned by Associate Justice Roberto A. Barrios and concurred in by Associate Justices Ramon Mabutas, Jr. and Eriberto U. Rosario, Jr. of the Eighth Division of the Court of Appeals; dated October 20, 2000; Rollo, pp. 51-56.

3 The resolution denied the motion for reconsideration; dated May 21, 2001; Id., pp. 70-71.

4 Id., pp. 32-33.

5 Filed by State Prosecutor Zenaida M. Lim; docketed as Criminal Case No. CBU-45890; Id., pp. 22-23.

6 Unfair competition.

7 Id., pp. 22-23.

8 Re: Designation of Special Courts for Intellectual Property Rights; issued on October 2, 1995.

9 Dated February 17, 1998; Id., pp. 24-26.

10 Penalty for violation of Article 189, RPC: prision correccional in its minimum period or fine ranging from P500 to P2,000, or both.

11 Id., pp. 27-30.

12 Re: Designation of Special Courts for Kidnapping, Robbery, Carnapping, Dangerous Drugs Cases

and other Heinous Crimes, Intellectual Property Rights Violations and Jurisdiction in Libel Cases;

Issued on October 21, 1996.

13 See note 4.

14 Under Rule 65 of the Rules of Court.

15 Sec. 4, Rule 65. When and where petition filed. 'The petition shall be filed not later than sixty (60) days from notice of the judgment, order or resolution. x x x

16 See note 2.

17 Id., p. 10.

18 Serrano v. Galant Maritime Services, Inc, et al., G.R. No. 151833, 7 August 2003; 408 SCRA 523.

19 Mercado-Fehr v. Fehr, G.R. No. 152716, 23 October 2003, 414 SCRA 288.

20 Nala v. Barroso, Jr., G.R. No. 153087, 7 August 2003, 408 SCRA 529.

21 The following are the instances when a special civil action for certiorari may be given due course even if no motion for reconsideration has been filed: (1) the issue raised is purely one of law; (2) public interest is involved; (3) the matter is one of urgency; (4) the question of jurisdiction was squarely raised, submitted to, met and decided by the lower court; and (5) the order is a patent nullity. (Far East Bank and Trust Co., v. Toh, Sr., G.R. No. 144018, 23 June 2003, 404 SCRA 590).

22 G.R. No. 132428, 24 October 2000, 344 SCRA 202.

23 Nachura, Outline Reviewer in Political Law, 2002 Edition, p. 242.

24 A.O. No. 104-96 (B) Violations of intellectual property rights such as, but not limited to, violations of Art. 188 of the RPC (substituting and altering trademarks, trade names, or service marks), Art. 189 of the RPC (unfair competition, fraudulent registration of trademarks, trade names, or service marks, fraudulent designation of origin, and false description) P.D. No. 49 (protection of intellectual property rights), P.D. No. 87 (an act creating the videogram regulatory board), R.A. No. 165 as amended (the trademark law) shall be tried exclusively by the RTC in accordance with the established raffle scheme except those covered by AO No. 113-95 dated October 2, 1995, in which case, the designated RTC shall continue to observe the provisions therein.

Considering that jurisdiction for violations of intellectual property rights hereinbefore mentioned is now confined exclusively to the RTC, the designation of MTC and MTCC under AO No. 113-95 is deleted and withdrawn.(emphasis ours)

25 SEC. 23. Special Jurisdiction to try special cases. ' The Supreme Court may designate certain branches of the Regional Trial Courts to handle exclusively criminal cases, juvenile and domestic relations cases, agrarian cases, urban land reform cases which do not fall under the jurisdiction of quasi-judicial bodies and agencies, and /or such other special cases as the Supreme Court may determine in the interest of a speedy and efficient administration of justice.

26 Olsen and Co. v. Aldanese, 43 Phil 259 (1922); San Miguel Brewery v. Magno, 128 Phil. 328 (1967).

27 Issued on June 23, 2003.