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QC judge rules against PSBA-QC shutdown

‘Students must not suffer due to corporate disputes’
/ 02:23 AM November 08, 2013

PSBA-QC CAMPUS: The court insists it should stay open. RAFFY LERMA

Saying students should not be made to suffer because of internal conflicts between corporate officials, a local court issued a writ of preliminary injunction on Thursday preventing the shutdown of the Quezon City campus of the Philippine School of Business Administration (PSBA).

Judge Catherine Manodon of Quezon City Regional Trial Court Branch 104 also cited “bad faith” on the part of the concerned school officials for pushing through with the shutdown last month despite the temporary restraining order (TRO) she issued on Oct. 17.

The 20-day TRO supposedly stopped the school from implementing a Sept. 20 notice of closure issued by PSBA Inc. officials, three of whom were named respondents in the case filed by a group of PSBA-QC students.


The respondents cited financial losses for the last eight years as the main reason for the closure. They also noted that lawyer Benjamin Paulino, who maintained that he remained president of the school, had been operating the campus “without an independent permit from the Commission on Higher Education (CHEd) and without authority from PSBA Inc.-QC, who is the grantee of recognition by CHEd.”

But according to Manodon, “the petitioners, as students of PSBA-QC, have the right to enroll until graduation, in recognition of the constitutional guarantee of institutional academic freedom.”

The judge cited a provision in the CHEd’s Manual of Regulations for Private Higher Education (Morphe), which states that the termination or closure of a higher learning institution should be done at the end of an academic year.


Right to complete studies

On Oct. 9, or nine days before the board was to close the campus for good, students Mary Plet Paguio, Charlene Zape and Patrick Lloret filed a petition for preliminary injunction to keep the school open. Claiming to represent over 4,000 students who would be affected by the closure, they invoked their right to be allowed to complete their courses in the school where they were enrolled.

“PSBA-QC has not proven its claim that it suffered serious business losses which is one of the grounds for the closure. Respondent school did not offer evidence to prove the alleged losses. Hence, the claim cannot be given weight,” Manodon said in her ruling.

“What is clear from the evidence presented is that the closure is primarily due to an intracorporate dispute between Attorney Paulino and the individual respondents (PSBA Inc. stockholders Juan Lim, Ramon Peralta and Antonio Magtalas) as to who has the right to operate PSBA-QC.”


Several civil cases pitting Paulino against the respondents are pending in another court.

‘Resolve dispute first’

“The court believes that the students should not be made to suffer due to the said intracorporate dispute among the stockholders and officers of the school. The dispute, which is related to this case, being the primary reason for the closure should be resolved first, pending which there is a need to preserve the status quo through a writ of injunction to avoid unnecessary damage to the students as well as faculty, staff and other employees of the school,” Manodon added.

She said shutting down the school at the end of the first semester violated the CHEd’s Morphe “and would cause grave damage to the petitioners and the other students who may not be able to continue their studies due to financial constraints brought about by additional expenses.”

The judge also noted that the petitioner-students had testified that they live in Antipolo City, Marikina City and towns in Rizal province, and that their transfer to the PSBA campus in Manila—an option given by the officials—would entail more travel expenses.

Cost of transferring

Transferring to a different school could also cost the students their scholarships, she said.

“There is an urgent necessity to restrain the implementation of the assailed resolution and notice of closure which caused and is continuing to cause grave and irreparable damage to petitioners and other students currently enrolled in the school. Closure will adversely affect scholars and employees who will lose their jobs.”

The judge found no merit in the respondents’ argument that the closure, scheduled on Oct. 18, had already been implemented and could no longer be undone.

“(They) were already aware that a TRO was issued on Oct. 17 and yet issued a notice of stoppage of operation of PSBA-QC, which indicates bad faith. Moreover, the implementation of the notice of closure was made by the respondents on Oct. 21, after the filing of the injunction suit, hence they may be compelled by the court to restore the former condition,” she said.


P200-K injunction bond

“Let a writ of preliminary injunction be issued enjoining the respondents, their representatives or anyone acting in their behalf from further implementing the notice of closure dated Sept. 20 and the resolution to close PSBA-QC and all the educational programs effective the end of classes on Oct. 18.”

The court required the petitioners to post a P200,000 injunction bond to answer for damages that the respondents may suffer as a result of the issuance of the writ.

Apart from Lim, Peralta and Magtalas, the other respondents included CHEd Chair Patricia Licuanan and the commission’s director for the National Capital Region, Catherine Castañeda.

The petitioners also asked for P1 million in damages, claiming the publication of the closure notice on the school’s website and in a newspaper had caused them “mental anguish, sleepless nights, stress, serious social humiliation, inconvenience and demoralization.”

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TAGS: Education, Judge Catherine Manodon, Philippine School of Business Administration, PSBA, PSBA-QC, PSBA-QC shutdown, Quezon City campus, Quezon City Regional Trial Court Branch 104
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