G.R. No. 215280 , November 27, 2019
FRANCISCO C. EIZMENDI, JR., JOSE S. TAYAG, JR., JOAQUIN L. SAN AGUSTIN, EDUARDO V. FRANCISCO, EDMIDIO V. RAMOS, JR., ALBERT G. BLANCAFLOR, REY NATHANIEL C. IFURUNG, MANUEL H. ACOSTA, JR., AND VALLE VERDE COUNTRY CLUB, INC., PETITIONERS, V. TEODORICO P. FERNANDEZ, RESPONDENT.

FACTS

The case stems from a Complaint for Invalidation of Corporate Acts and Resolutions with Application for Writ of Preliminary Injunction filed by respondent Teodorico P. Fernandez against the individual petitioners. The complaint was a response to incidents surrounding the February 23, 2013 annual membership meeting of Valle Verde Country Club, Inc. (VVCCI) and the respondent’s subsequent six-month suspension as a member. Respondent alleges that the scheduled annual meeting, held through a hold-over Board of Directors (BoD), was adjourned for lack of quorum. Immediately after the adjournment, the individual petitioners took over the proceedings, declared a quorum using a different basis for computation, and elected themselves as the new BoD. Later, on October 18, 2013, this new BoD passed a resolution suspending the respondent for six months for violating the club’s by-laws. Respondent argues that since the annual meeting lacked a quorum, it was void; consequently, the petitioners’ election as the new BoD and all subsequent acts, including his suspension, are void and without legal effect. The petitioners dispute the lack of quorum and assert the validity of their election and subsequent corporate acts.

ISSUE

Whether the Complaint filed by the respondent constitutes an election contest under the Interim Rules of Procedure Governing Intra-Corporate Controversies, such that it should have been filed within the fifteen-day reglementary period prescribed for such contests.

RULING

Dissenting Opinion (Justice A. Reyes, Jr.):
The dissenting opinion holds that the respondent’s Complaint is NOT an election contest. A holistic reading of the complaint reveals its primary purpose is to question the very legitimacy of the February 23, 2013 annual membership meeting due to alleged lack of quorum, not to dispute the title or claim to an elective office. The material averments and the relief sought—specifically the prayer to nullify the said annual meeting and all subsequent board meetings and resolutions—focus on the validity of the meeting itself. The challenge to the individual petitioners’ authority as BoD members is merely a necessary consequence of annulling the foundational meeting. The dissenting opinion distinguishes this from a pure election contest, which directly involves title to office, the manner and validity of elections, or candidate qualifications. Citing jurisprudence (Ponce v. Baguio Country Club Corporation and Santos v. Sps. Lumbao), the opinion emphasizes that an action primarily seeking to nullify a corporate meeting for lack of quorum is a derivative suit questioning the validity of corporate acts, not an election contest. Therefore, the fifteen-day filing period for election contests does not apply. The dissent concludes that the respondent’s Motion for Reconsideration on this point is meritorious and votes to grant it, set aside the Court’s September 5, 2018 Decision, and reinstate the Court of Appeals’ earlier decision.