Jose P. Tambunting, Sr. v. Spouses Andres T. Liboro & Teresita Liboro

Summary

This case involved a family dispute over ownership and control of Philippine Merchants Holding Co., Inc. (PMHCI), which owned valuable real property worth P70 million. Teresita Liboro, sister of deceased Jose Tambunting Sr., contested the validity of stock issuances and capital increases that diluted her control of the corporation. The Regional Trial Court initially favored the Tambunting children, but the Court of Appeals reversed, recognizing Teresita's ownership rights. Before the Supreme Court could decide the substantive issues, the parties submitted a compromise agreement following Jose Sr.'s death. The Supreme Court approved the settlement, which recognized Teresita's ownership and control of PMHCI, established liquidated damages of P17.5 million for breach, and required dismissal of all related cases. The decision demonstrates judicial approval of family settlements in corporate disputes and the binding effect of compromise agreements under Civil Code provisions.