G.R. No. 138104; April 11, 2002
MR HOLDINGS, LTD., petitioner, vs. SHERIFF CARLOS P. BAJAR, SHERIFF FERDINAND M. JANDUSAY, SOLIDBANK CORPORATION, AND MARCOPPER MINING CORPORATION, respondents.

FACTS

Marcopper Mining Corporation obtained a loan from the Asian Development Bank (ADB), secured by a mortgage on its properties. Upon Marcopper’s default, Placer Dome, Inc., a major shareholder, had its subsidiary, petitioner MR Holdings, Ltd., assume the obligation. ADB subsequently assigned all its rights under the loan and mortgage agreements to MR Holdings. Marcopper also executed a Deed of Assignment conveying its properties to MR Holdings. Meanwhile, Solidbank Corporation obtained a partial judgment against Marcopper for a separate debt. Solidbank moved for execution, and sheriffs levied on Marcopper’s properties and scheduled a public auction. MR Holdings filed a third-party claim, asserting ownership over the levied properties by virtue of the Deed of Assignment. Upon denial of its claim, MR Holdings filed a complaint for reivindication with a prayer for a preliminary injunction in the Regional Trial Court (RTC) of Boac, Marinduque.

ISSUE

Whether the Court of Appeals erred in upholding the RTC’s denial of the application for a writ of preliminary injunction.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals. The RTC did not commit grave abuse of discretion in denying the injunction. First, the injunction would effectively stay the execution of a final and executory judgment rendered by a co-equal court (the RTC of Manila in Solidbank’s favor), which is generally prohibited unless the judgment is void or the property levied is not owned by the judgment debtor. MR Holdings’ claim of ownership, based on the Deed of Assignment executed after Solidbank’s claim had accrued, did not clearly establish a right superior to Solidbank’s judgment credit at the preliminary injunction stage. Second, the RTC correctly found that MR Holdings, a foreign corporation, lacked legal capacity to sue. The series of transactions—assuming Marcopper’s debt, obtaining assignments, and seeking to operate its business—demonstrated it was “doing business” in the Philippines without the required license, barring it from maintaining suit in Philippine courts. The timing of the assignments also raised serious questions about their validity, as they were executed when Marcopper was already insolvent and facing Solidbank’s claims, potentially to the prejudice of existing creditors. A preliminary injunction is an extraordinary remedy; the applicant must prove a clear and unmistakable right. MR Holdings failed to discharge this burden.