The prejudicial question must be determinative of the case before the court but the jurisdiction to try and resolve it must be lodged in another court or tribunal.

[G.R. No. 140777.  April 8, 2005]

ANTONIO ABACAN, JR., RUFO C. VENUS, JR., ENRIQUETO I. MAGPANTAY and MARIETA Y. PALANCA, petitioners, vs. NORTHWESTERN UNIVERSITY, INC., respondent.

“x x x.

Third issue.  Whether the proceedings in Civil Case No. 11296-14 must be held in abeyance pending resolution of SEC Case No. 12-96-5469.  We rule in the affirmative.

Petitioners argue that SEC Case No. 12-96-5469, which is an action to nullify the election of the directors of NUI belonging to the “Castro faction,” is a necessary and logical antecedent of the issue of whether the withdrawal of P1.4 M orP1.6 M, as the case may be, as well as the institution of this suit for the recovery thereof was authorized by the NUI.

Technically, there would be no prejudicial question to speak of in this case, if we are to consider the general rule that a prejudicial question comes into play in a situation where a civil action and a criminal action are both pending and there exists in the former an issue which must be preemptively resolved before the criminal action may proceed, because howsoever the issue in the civil action is resolved would be determinative juris et de jure of the guilt or innocence of the accused in the criminal case.^[34] However, considering the rationale behind the principle of prejudicial question, being to avoid two conflicting decisions,^[35] prudence dictates that we apply the principle underlying the doctrine to the case at bar.

A prejudicial question is that which arises in a case, the resolution of which is a logical antecedent of the issue involved therein and the cognizance of which pertains to another tribunal.^[36] The prejudicial question must be determinative of the case before the court but the jurisdiction to try and resolve it must be lodged in another court or tribunal.^[37]

In the present case, the question of which between the Castro and the Nicolas factions are the de jure board of directors of NUI is lodged before the SEC.  The complaint before the RTC of Laoag meanwhile alleges that petitioners, together with their co-defendants, comprised of the “Castro faction,” wrongfully withdrew the amount of P1.4 M from the account of NUI with Metrobank.  Moreover, whether or not Roy Nicolas of the “Nicolas faction” is a duly elected member of the Board of NUI and thus with capacity to institute the herein complaint in behalf of the NUI depends on the findings of the SEC in the case pending before it.  It would finally determine whether Castro, et al. legally withdrew the subject amount from the bank and whether Nicolas lawfully initiated the complaint in behalf of herein respondent NUI.  It is petitioners’ claim, and we agree, that the presence or absence of their liability for allowing the withdrawal of P1.4 M from the account of NUI with Metrobank in favor of the “Castro faction” is reliant on the findings of the SEC as to which of the two factions is the de jure board.  Since the determination of the SEC as to which of the two factions is the de jure board of NUI is crucial to the resolution of the case before the RTC, we find that the trial court should suspend its proceedings until the SEC comes out with its findings.

We apply by analogy our pronouncement in Quiambao vs. Osorio,^[38] to wit:

Faced with these distinct possibilities, the more prudent course for the trial court to have taken is to hold the ejectment proceedings in abeyance until after a determination of the administrative case.  Indeed, logic and pragmatism, if not jurisprudence, dictate such move.  To allow the parties to undergo trial notwithstanding the possibility of petitioner’s right of possession being upheld in the pending administrative case is to needlessly require not only the parties but the court as well to expend time, effort and money in what may turn out to be a sheer exercise in futility. Thus, 1 Am Jur 2d tells us:

The court in which an action is pending may, in the exercise of a sound discretion, upon proper application for a stay of that action, hold the action in abeyance to abide the outcome of another pending in another court, especially where the parties and the issues are the same, for there is power inherent in every court to control the disposition of causes on its dockets with economy of time and effort for itself, for counsel, and for litigants.  Where the rights of parties to the second action cannot be properly determined until the questions raised in the first action are settled the second action should be stayed.

While this rule is properly applicable to instances involving two [2] court actions, the existence in the instant case of the same considerations of identities of parties and issues, economy of time and effort for the court, the counsels and the parties as well as the need to resolve the parties’ right of possession before the ejectment case may be properly determined, justifies the rule’s analogous application to the case at bar.^[39]

X x x.”