Labrador vs CA (180 SCRA 266)

Labrador vs Court of Appeals
180 SCRA 266 [GR No. 58168 December 19, 1989]

Facts: On February 9, 1979, Adelaida Rodriguez Magsaysay widow and special administratrix of the estate of the late senator Magsaysay, brought before the then Court of First Instance of Olongapo an action against Artemio Panganiban, Subic Land Corporation, Filipinas Manufacturer’s Bank and the Register of Deeds of Zambales. In her complaint, she alleged that in 1958, she and her husband acquired thru conjugal funds, a parcel of land with improvements known as “Pequena Island” covered by TCT No. 3258; that after the death of her husband, she discovered a.) an annotation at the back of TCT No. 3258 that the land was acquired by her husband from his separate capital; b.) the registration of a deed of assignment dated June 25, 1976 purportedly executed by the late senator in favor of SUBIC, as a result of which TCT No. 3258 was cancelled and TCT No. 22431 issued in the name of SUBIC; and c.) the registration of deed of mortgage dated April 28, 1977 in the amount of Php2,700,000 executed by SUBIC in favor of FILMABANK that the foregoing acts were void and done in an attempt to defraud the conjugal partnership considering that the land is conjugal, her marital consent to the annotation on TCT No. 3258 was not obtained, the change made by the Register of Deeds of the titleholders was effected without the approval of the commissioner of land registration and that the late senator did not execute the purported deed of assignment or his consent thereto, if obtained, was secured by mistake, violence, and intimidation. She further alleged that the assignment in favor of SUBIC was without consideration and consequently null and void. She prayed that the deed of assignment and the deed of mortgage be annulled and that the register of deeds be ordered to cancel TCT no. 22431 and to issue a new title in her favor. on March 7, 1979, herein petitioners, sisters of the late senator, filed a motion for intervention on the ground that on June 20, 1978, their brother conveyed to them 1/2 of his shareholdings in SUBIC or a total of 416,566.6 shares and as assignees of around 41% of the total outstanding shares of such stocks of SUBIC, they have substantial and legal interest in the subject matter of litigation and that they have a legal interest in the success of the suit with respect to SUBIC.

Issue: Whether or not the intervention of the petitioners is proper.

Held: No. To allow intervention, a.) it must be shown that the m ovant has legal interest in the matter in litigation, or otherwise qualified; and b.) consideration must be given as to whether the adjudication of the rights of the original parties may be delayed or prejudicial, or whether the intervenor’s rights may be protected in a separate proceeding or not. Both requirements must concur as the first is not more important than the second.

While a share of stock represents a proportionate or aliquot interest in the property of the corporation, it does not vest the owner thereof with any legal right or title to any of the property, his interest in the corporate property being equitable or beneficial in nature. Shareholders are in no legal sense the owners of corporate property, which is owned by the corporation as a distinct legal person.

The movant’s interest may be protected in a separate proceeding is a factor to be considered in allowing or disallowing a motion for intervention.


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