Legal Ethics

Sixto Crisostomo vs Securities and Exchange Commission

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G.R. Nos. 89095 & 89555 – 179 SCRA 146 -Legal Ethics – Duty Against Forum Shopping

Crisostomo is a minority stockholder of the United Doctors Medical Center. He is also the director and legal counsel of UDMC. The said hospital was unable to pay its P55 million debt incurred from the Development Bank of the Philippines hence it faced foreclosure. In order to avoid foreclosure, Crisostomo and some others were able to convince Japanese doctors to invest in the hospital. Eventually, these Japanese doctors invested P57 million in said hospital. Pursuant to the Memorandum in lieu of the investment, the Japanese doctors were promised¬† to be part of the hospital’s board of directors. But then, instead of holding an election for the new board of directors, Crisostomo opposed the same citing constitutional grounds. The issue reached the Securities and Exchange Commission which ordered UDMC to hold the election.

Meanwhile, Crisostomo filed an action to annul the Memorandum agreed with the Japanese doctors before the Regional Trial Court of Makati. The said RTC denied Crisostomo’s petition.

Crisostomo then appealed the two decisions (SEC’s and the RTC’s) before the Court of Appeals. Not only that, while the two cases were pending appeal, he also filed a petition for certiorari directly to the Supreme Court.

ISSUE: Whether or not Crisostomo is guilty of forum shopping.

HELD: Yes.  All three actions he filed raise the same issues that he raised in the different tribunals. There is forum-shopping whenever, as a result of an adverse opinion in one forum, a party seeks a favorable opinion (other than by appeal or certiorari) in another. The principle applies not only with respect to suits filed in the courts but also in connection with litigations commenced in the courts while an administrative proceeding is pending, as in this case, in order to defeat administrative processes and in anticipation of an unfavorable administrative ruling and a favorable court ruling.

Forum-shopping makes Crisostomo subject to disciplinary action and renders his petitions in the Supreme Court and in the Court of Appeals dismissible. He and his counsel are guilty of contempt. Crisostomo is ordered by the Supreme Court to pay double the costs of the suit.

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