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Bitong vs.

Court of Appeals
292 SCRA 503 (1998)

FACTS:

Petitioner Nora Bitong, claiming to be a former Treasurer and


Member of the Board of Directors of Mr. & Ms.
Publishing Co. filed a derivative suit before
the Securities andExchange Commission (SEC) allegedly
for the benefit of private respondent Mr. & Ms.
Publishing Co., Inc. to hold respondent spouses Eugenia
Apostol and Jose Apostol liable for fraud, misrepresentation,
disloyalty, evident bad faith, conflict of interest and mismanagement
in directing the affairs of Mr. & Ms to its damage and prejudice
and its stockholders. She further alleged that respondents
Apostol, Magsanoc and Nyuda subscribed to Philippine Daily
Inquirer (PDI) shares of stock; the stock subscriptions were paid for
by Mr. & Ms.and treated
a s r e c e i v ab l e s fr o m o f fi c e r s a n d e m p l o ye e s b u t n o
p aym e n t s w e r e e ve r r e c e i ve d f r o m respondents. The
petition principally sought to enjoin respondent spouses from further
acting a president-director and director, respectively of Mr.
& Ms and disbursing any money or funds except for the
payment of salaries and similar expenses in the ordinary
course of business. Private respondents refuted the allegations of
petitioner saying that she was merely a holder-in-trust of JAKA
shares and only represented and continue to represent
JAKA in the board. JAKA, owned by spouses Senator Juan
Ponce Enrile and Cristina Ponce Enrile, is one of the original
stockholders of Mr. & Ms.
. The respondents averred that the real party-in-interest was
JAKA and not petitioner. Bitong testified at trial that she
became the registered owner of 997shares of stock of Mr.
& Ms. after she acquired them from JAKA through a deed of
sale. The SEC Hearing Panel dismissed the derivative suit. The
SECEn Banc reversed the decision of the Hearing Panel. The
Court of Appeals reversed the decision of the SEC En Banc
and held that from the evidence in record, petitioner was not
the owner of the shares of stock in Mr. & Ms.and therefore not
a real party-in-interest to prosecute the claim. She was merely
an agent who cannot file a derivative suit in behalf of her principal.
Before the Supreme Court, petitioner submits that in her Amended
Petitionin the SEC,she stated that she was a stockholder and
director of Mr. & Ms.and even declared that “she isthe
registered owner of 1,000 shares of stock of Mr. & Ms.
out of the latter’s 4,088 total outstanding shares, and that
she was a member of the Board of Directors and treasurer of
said company. She contends that respondents did not deny
the above allegations in their answer and are therefore
conclusively bound by this judicial admission.

ISSUE:

W h e t h e r t h e r e w as j ud i c i al ad m i s si o n o n t h e
p ar t o f t h e r e s p o n d e n t s t h a t petitioner is a stockholder
of Mr. & Ms.

RULING:

The answer of private respondents shows that there


was no judicial admission that petitioner was a stockholder
of Mr. & Ms.to entitle her to file a derivative suit on behalf of
thecorporation. The affirmative defenses of private
respondents directly refute the representationof petitioner that
she is a true stockholder of Mr. & M, by stating unequivocally that
petitioner is not the true party to the case but JAKA which
continues to be the stockholder of Mr. & Ms.

In fact, one of the reliefs prayed for was the


dismissal of the petition on the ground that petitioner did
not have the legal interest to initiate and prosecute the same.

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