Magsaysay-Labrador v CA

Facts:
Respondent Adelaida Rodriguez-Magsaysay, widow and special administratix of the estate of the
late Senator Genaro Magsaysay, brought an action against Artemio Panganiban, Subic Land
Corporation (SUBIC) and others, for the annulment of the Deed of Assignment and the Deed of
Mortgage and the cancellation of tittle issued by the register of deeds in favor of SUBIC. Respondent
alleged that she and her husband acquired, thru conjugal funds, the subject parcel of land with
improvements and that after the death of her husband, she discovered the annotation in the tittle that
said land was acquired by her husband through his separate capital and the same was assigned by
her husband to SUBIC through a deed of assignment registered in the registry of deeds, as a result
of which, a new tittle was issued to SUBIC. Petitioners, sisters of the late senator, filed a motion for
intervention on the ground that their brother conveyed to them one-half (1/2 ) of his shareholdings in
SUBIC and as assignees of around 41 % of the total outstanding shares of such stocks of SUBIC,
they have a 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. The court denied the motion for
intervention, and ruled that petitioners have no legal interest whatsoever in the matter in litigation
and their being alleged assignees or transferees of certain shares in SUBIC cannot legally entitle
them to intervene because SUBIC has a personality separate and distinct from its stockholders. On
appeal, respondent Court of Appeals found no factual or legal justification to disturb the findings of
the lower court.

Issue:
Whether or not respondents, as stockholders of SUBIC, are interested party in a
case where corporate property is in dispute.

Held:
No. Viewed in the light of Section 2, Rule 12 of the Revised Rules of Court, this Court affirms the
respondent court's holding that petitioners herein have no legal interest in the subject matter in
litigation so as to entitle them to intervene in the proceedings below. To allow intervention, [a] it must
be shown that the movant 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 prejudiced, 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.
The interest which entitles a person to intervene in a suit between other parties must be in the matter
in litigation and of such direct and immediate character that the intervenor will either gain or lose by
the direct legal operation and effect of the judgment.

Here, the interest, if it exists at all, of petitioners-movants is indirect, contingent, remote, conjectural,
consequential and collateral. At the very least, their interest is purely inchoate, or in sheer
expectancy of a right in the management of the corporation and to share in the profits thereof and in
the properties and assets thereof on dissolution, after payment of the corporate debts and
obligations.

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
.