CIVPRO Digests Venue PILTEL vs Tecson

8/13/2019 CIVPRO Digests Venue PILTEL vs Tecson

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TIMES, Inc. vs. Reyes (1971)

1.Causative event

2.Villegas and Enrile file action for damages for libelagainst TIME in CFI

Rizal. RTC, on motion of plaintiffs, issues order to take deposition of TIME

officers.

RTC issues writ of attachment on real and personal estate of TIME.

TIME receives summons.

TIME files MTD.

RTC issues order of defermentin determining the MTD.

3.TIME files petition for certiorari and prohibition, with preliminary

injunction, in SC.

Villegas and Enrile file MTD. Statement of issues

Purpose of choices of venue in libel

On applicability of R.A. 4363

On legal capacityof TIME

Causative event:TIME published an essay.

"Corruption in Asia": The problem of Manila's mayor, ANTONIO VILLEGAS,

is a case in point. When it was discovered last year that the mayor's cofferscontained far more pesos than seemed reasonable in the light of his

income, an investigation was launched. Witnesses who had helped him out

under curious circumstance were asked to explain in court. Onegovernment official admitted lending Villegas P30,000 pesos ($7,700)

without interest because he was the mayor's compadre. An assistantdeclared he had given Villegas loans without collateral because he

regarded the boss as my own son. A wealthy Manila businessman testified

that he had lent Villegas' wife 15,000 pesos because the mayor was like a

brother to me. With that, Villegas denounced the investigation as aninvasion of his family's privacy. The case was dismissed on a technicality,

and Villegas is still mayor.

At the time of the publication of the allegedly offending essay, private

respondents Antonio Villegas and Juan Ponce Enrile were the Mayor Of the


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City of Manila and Undersecretary of Finance and concurrently Acting

Commissioner of Customs, respectively, with offices in the City of Manila

Villegas & Enrile's Complaint:

(4) Defendants, conspiring and confederating, published a libelous

article, publicly, falsely and maliciously imputing to Plaintiffs thecommission of the crimes of graft, corruption and nepotism; that said

publication particularly referred to Plaintiff Mayor Antonio J. Villegas as a

case in point in connection with graft, corruption and nepotism in Asia; that

said publication without any doubt referred to co-plaintiff Juan Ponce Enrile

as the high government official who helped under curious circumstances

Plaintiff Mayor Antonio J. Villegas in lending the latter approximately

P30,000.00 ($7,700.00) without interest because he was the Mayor'scompadre; that the purpose of said Publications is to cause the dishonor,

discredit and put in public contempt the Plaintiffs, particularly Plaintiff Mayor

Antonio J. Villegas.

Summons:TIME received the summons and a copy of the complaint at its

offices in New York.

TIME's MTD:for lack of jurisdictionand improper venue, relying upon R.A.

4363.

Lack of jurisdiction: ???

Improper venue: because R.A. 4363 states that public officers holding

office in City of Manila should sue either in court in City of Manila or in the

court where the article was first printed and published. Enrile & Villegas, on

the other hand, filed their suit in CFI of Rizal.

Order of Deferment: the court having considered that the grounds relied upon

in the motion do not appear to be indubitable.

"the rule laid down under Republic Act. No. 4363, amending Article 360 of

the Revised Penal Code, is not applicable to actions against non-resident

defendants, and because questions involving harassment and

inconvenience, as well as disruption of public service do not appear


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indubitable. ..."

Enrile & Villegas' MTD:

A. R.A. 4363 is not applicable to non-resident defendants

1. since a non-resident defendant is not in a position to comply with the

conditions imposed for the effectivity of the statute, such defendant may not

invoke its provisions;

2. that a foreign corporation is not inconvenienced by an out-of-town libel

suit;

3. that it would be absurd and incongruous, in the absence of an extradition

treaty, for the law to give to public officers with office in Manila the secondoption of filing a criminal case in the court of the place where the libelous

article is printed and first published if the defendant is a foreign corporation

4. that, under the "single publication" rule which originated in the United

States and imported into the Philippines, the rule was understood to meanthat publications in another state are not covered by venue statutes of the

forum.

B. Foreign corporation failed to allege its capacity to sue in the courts of thePhilippines

SEC. 69, CORPORATION CODE: No foreign corporation or corporations

formed, organized, or existing under any laws other than those of the

Philippines shall be permitted to ... maintain by itself or assignee any suit

for the recovery of any debt, claim, or demand whatever, unless it shall

have the license prescribed in the section immediately preceding.

Marshall-Wells Co. vs. Elser & Co., Inc.: no foreign corporation may bepermitted to maintain any suit in the local courts unless it shall have the

license required by the law

Atlantic Mutual Ins. Co., Inc. vs. Cebu Stevedoring Co., Inc.: "where ... the

law denies to a foreign corporation the right to maintain suit unless it haspreviously complied with a certain requirement, then such compliance or


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the fact that the suing corporation is exempt therefrom, becomes a

necessary averment in the complaint."

C. present petition is premature, since respondent court has not definitely

ruled on the motion to dismiss, nor held that it has jurisdiction.

Statement of issues:

1. Whether or not, under the provisions of Republic Act No. 4363 the

respondent Court of First Instance of Rizal has jurisdiction to take

cognizance of the civil suit for damages arising from an allegedly libelous

publication, considering that the action was instituted by public officerswhose offices were in the City of Manila at the time of the publication; if it

has no jurisdiction, whether or not its erroneous assumption of jurisdictionmay be challenged by a foreign corporation by writ of certiorari or

prohibition; and

2. Whether or not Republic Act 4363 is applicable to action against a

foreign corporation or non-resident defendant.

R.A. 4363:

Venue for libel:

1. CFI of province/city where article is printed and first published, or2. Residence of any of the offended parties at time of commission of

offense.

If one of offended parties is public officer in City of Manila:

1. CFI of City of Manila, or

2. City/province where article was printed and first published.

If one of offended parties is public officer, but not in City of Manila:

1. CFI of province/city where he holds office at time of commission ofoffense

2. City/province where article was printed and first published

If one of offended parties is private individual:

1. Court of First Instance of the province or city where he actually resides at


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the time of the commission of the offense or

2. City/province where the libelous matter is printed and first published.

Provided, further, That the civil action shall be filed in the same court where

the criminal action is filed and vice versa;

Provided, furthermore, That the court where the criminal action or civilaction for damages is first filed, shall acquire jurisdiction to the exclusion of

other courts;

And provided finally, That this amendment shall not apply to cases of

written defamations, the civil and/or criminal actions which have been filedin court at the time of the effectivity of the law

Sec. 3. This Act shall take effect only if and when, within thirty days from itsapproval, the newspapermen in the Philippines shall organize, and elect the

members of, a Philippine Press Council, a private agency of the saidnewspapermen, whose function shall be to promulgate a Code of Ethics for

them and the Philippine press investigate violations thereof, and censureany newspaperman or newspaper guilty of any violation of the said Code,

and the fact that such Philippine Press Council has been organized and its

members have been duly elected in accordance herewith shall be

ascertained and proclaimed by the President of the Philippines.

Since the offending publication was not printed in the Philippines, the

alternative venue was not open to respondent Mayor Villegas of Manila and

Undersecretary of Finance Enrile, who were the offended parties.

Choice of venue in libel:

The choices of venue, as introduced into the Penal Code through itsamendments by Republic Act 4363, was intended "to minimize or limit the

filing of out-of-town libel suits".

a libeled public official might sue in the court of the locality where he holds

office, in order that the prosecution of the action should interfere as little aspossible with the discharge of his official duties and labors.

The only alternative allowed him by law is to prosecute those responsible


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for the libel in the place where the offending article was printed and first

published.

Here, the law tolerates the interference with the libeled officer's duties only

for the sake of avoiding unnecessary harassment of the accused.

On applicability of R.A. 4363 to nonresident defendant:

1. Nothing in the law limits the effectivity of the venue statute to the

exclusion of non-resident defendants.

2. That foreign corporation is not inconvenienced by out-of-town libel suits =

not valid argument. Venue and jurisdiction do not depend on inconvenienceof a party, but on public policy.

3. That Enrile & Villegas could not file a criminal case for libel against a

non-resident defendant does not make RA 4363 incongruous or absurd, for

such inability to file a criminal case against a non-resident natural person

equally exists in crimes other than libel.

4. "multiple publication" and "single publication": IMMATERIAL. These rulesare not pertinent in the present scheme because the number of causes of

action that may be available to the respondents-plaintiffs is not here inissue. We are here confronted by a specific venue statute, conferring

jurisdiction in cases of libel against Public officials to specified courts, and

no other.

On legal capacity of TIME:

TIME's failure to aver its legal capacity to institute the present petition is not

fatal:

A foreign corporation may, by writ of prohibition, seek relief against the

wrongful assumption of jurisdiction. And a foreign corporation seeking awrit of prohibition against further maintenance of a suit, on the ground of

want of jurisdiction in which jurisdiction is not bound by the ruling of thecourt in which the suit was brought, on a motion to quash service of

summons, that it has jurisdiction.

On premature petition


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Order of deferral is correctible by writ of prohibition or certiorari.

the jurisdiction of a court over the subject-matter is determined by the

allegations in the complaint; and when a motion to dismiss is filed for lack

of jurisdiction those allegations are deemed admitted for purposes of suchmotion, so that it may be resolved without waiting for the trial. Thus it hasbeen held that the consideration thereof may not be postponed in the hope

that the evidence may yield other qualifying or concurring data which would

bring the case under the court's jurisdiction.'

---

Marcos-Araneta vs. CA (2008)

1.Causative event2. Irene Marcos-Araneta files two (2) complaints in RTC for conveyance of

shares of stock, accounting and receivership against the Benedictogroup.

Francisca Benedicto files MTD, followed by Amended MTD, for the 2

complaints.

Irene files Consolidated Opposition. / Benedicto and daughter filesJoint Reply to Opposition. / Both cases were consolidated on

Benedicto's motion.

Benedicto died, substituted by wife and daughter.

RTC DISMISSEScomplaints.

Irene files MR. / DENIED.

Irene files Motion to Admit Amended Complaint. / GRANTED.

Benedicto's file Motion to Dismiss Amended Complaint, with MR. /

DENIED.

Benedicto's file Answerjust to avoid being in default.

3.Benedicto's file petition for certiorariin CA.

Benedicto's file Authorizing Affidavit (re: non-forum shopping). CA issues TRO and writ of preliminary injunction.

CA GRANTS petition.

Irene files MR. / DENIED.

4. Irene files petition for review in SC.

SC DISMISSES the petition.


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WON there is sufficient compliance with non-forum shopping

verification and certification by Benedicto's? Yes.

WON the certiorari tried to decide the merits of the case? No.

WON the amended complaint was proper after the final judgment

on the original complaint? Yes. WON the ground of improper venue was waived by Benedicto's?

No.

WON Irene is a resident of Makati or Batac? Makati.

WON Irene's co-plaintiffs' residence allowed proper venue in Batac?

No.1.

2. Causative event:Sometime in 1968 and 1972, Ambassador Roberto S.

Benedicto, now deceased, and his business associates (Benedicto

Group) organized Far East Managers and Investors, Inc. (FEMII) andUniversal Equity Corporation (UEC), respectively. As petitioner Irene

Marcos-Araneta would later allege, both corporations were organized

pursuant to a contract or arrangement whereby Benedicto, as trustor,

placed in his name and in the name of his associates, as trustees, theshares of stocks of FEMII and UEC with the obligation to hold those

shares and their fruits in trust and for the benefit of Irene to the extent

of 65% of such shares. Several years after, Irene, through her trustee-

husband, Gregorio Ma. Araneta III, demanded the reconveyance of

said 65% stockholdings, but the Benedicto Group refused to oblige.3.

4. Irene's 2 complaints: for conveyance of shares of stock, accounting and

receivership against the Benedicto Group with prayer for the issuance of a

temporary restraining order (TRO).5.

6.Case 1: recovery of UEC shares, impleading Benedicto, his daughter, and

20 defendants.

7.Case 2: recovery of 65% of FEMII shares held by Benedicto and other

defendants.8.

9. Irene is basically asking Benedicto and his Group, as defendants a

quo, to acknowledge holding in trust Irenes purported 65%

stockownership of UEC and FEMII, inclusive of the fruits of the trust,

and to execute in Irenes favor the necessary conveying deed over the


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said 65% shareholdings.10.

11. Francisca's MTD:12.

13. (1) the cases involved an intra-corporate dispute over which theSecurities and Exchange Commission, not

14. the RTC, has jurisdiction;

15. (2) venue was improperly laid; and

16. (3) the complaint failed to state a cause of action, as there was no

allegation therein that plaintiff, as

17. beneficiary of the purported trust, has accepted the trust created in

her favor.18.

19. ISSUE ON VENUE: RTC complaints were filed in Batac, Ilocos Norte.

Irene did not maintain residence in

20. said place as she in fact only visited the mansion twice in 1999; thatshe did not vote in Batac in the 1998

21. national elections; and that she was staying at her husbands house

in Makati City.22.

23. Benedicto presented joint affidavit of household staff as evidence.24.

25. Irene presented CTC in Curimao, Ilocos Norte as evidence.26.

27. RTC's dismissal: these partly constituted real action, and that Irene

did not actually reside in Ilocos Norte, and, therefore, venue was improperly

laid. In its dismissal order28.

29. Irene's Amended Complaint:to admit additional plaintiffs, who are Irene's

new trustees.30.

31. RTC's grant of Motion to Admit Amended Complaint:

32.33. (1) Pursuant to Section 2, Rule 10 of the Rules of Court, Irene may

opt to file, as a matter of right, an amended complaint.

34. (2) The inclusion of additional plaintiffs, one of whom was a Batac, an

Ilocos Norte resident, in the amended complaint setting out the same

cause of action cured the defect of improper venue.


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35. (3) Secs. 2 and 3 of Rule 3 in relation to Sec. 2 of Rule 4 allow the

filing of the amended complaint in question in the place of residence

of any of Irenes co-plaintiffs.36.

37.

In said order, the RTC stood pat on its holding on the rule onamendments of pleadings. And scoffing at the argument about therebeing no complaint to amend in the first place as of October 9, 2000

(when the RTC granted the motion to amend) as the original

complaints were dismissed with finality earlier, i.e., on August 25,

2000 when the court denied Irenes motion for reconsideration of theJune 29, 2000 order dismissing the original complaints, the court

stated thusly: there was actually no need to act on Irenes motion toadmit, it being her right as plaintiff to amend her complaints absent

any responsive pleading thereto. Pushing its point, the RTC addedthe observation that the filing of the amended complaint on July 17,

2000 ipso facto superseded the original complaints, the dismissal of

which, per the June 29, 2000 Order, had not yet become final at the

time of the filing of the amended complaint.38.

39. Benedicto's petition for certiorari in CA: seeking to nullify the following

RTC orders: the first, admitting the amended complaint; the second,denying their motion to dismiss the amended complaint; and the third,

denying their motion for reconsideration of the second issuance.40.

41. ISSUE 1: Non-Forum Shopping42.

43. Julia did not sign verification and certification of non-forum shopping.Only Francisca did.

44.

45. CA acted within its sound discretion in ordering the submission of

proof of Franciscas authority to sign on

46. Julitas behalf and represent her in the proceedings before theappellate court. Francisca is herself a

47. principal party.48.

49. This requirement is formal, not jurisdictional.50.

51. Rules on non-forum shopping signature: if there is commonality of


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interest, or if one cause of action, but

52. multiple parties, signature of plaintiff acting as representative, is

sufficient compliance.53.

54.

ISSUE 2:Merits55.56. CA proceeded to pass on the factual issue of the existence and

enforceability of the asserted trust. It

57. overstepped boundaries.58.

59. ISSUE 3: Admission of Amended Complaint Proper60.

61. SEC. 2, RULE 10. Amendments as a matter of right. A partymay amend his pleading once as a matter of right at any time before

a responsive pleading is served or in the case of a reply, at any timewithin ten (10) days after it is served.

62.

63. The MTD is not a responsive pleading.64.

65. The finality of such dismissal order had not set in when Irene filed the

amended complaint on July 17, 2000, she having meanwhile seasonably

sought reconsideration thereof. Irenes motion for reconsideration was only

resolved on August 25, 2000. Thus, when Irene filed the amended

complaint on July 17, 2000, the order of dismissal was not yet final, implyingthat there was strictly no legal impediment to her amending her originalcomplaints.66.

ISSUE 4 & 5:

On waiver of improper venue

Irene: Benedicto's waived ground of improper venue by filing numerous

pleadings.

SC: no waiver.

Can ground of improperly laid venue be waived?

Davao Light & Power Co. vs. CA: Where the defendant failed to either file a


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motion to dismiss on the ground of improper venue or include the same as

an affirmative defense, he is deemed to have waived his right to object to

improper venue.

Benedicto and Francisca raised at the earliest time possible, meaningwithin the time for but before filing the answer to the complaint (Rule 16,Sec. 1).

They would thereafter reiterate and pursue their objection on venue, first, intheir answer to the amended complaints and then in their petition for

certiorari before the CA.

On real vs. personal

Benedicto's: the venue was in this case improperly laid since the suit inquestion partakes of a real action involving real properties located outside

the territorial jurisdiction of the RTC in Batac.

SC: personal action.

The fact that FEMIIs assets include real properties does not materiallychange the nature of the action, for the ownership interest of a stockholder

over corporate assets is only inchoate as the corporation, as a juridical

person, solely owns such assets. It is only upon the liquidation of thecorporation that the stockholders, depending on the type and nature of their

stockownership, may have a real inchoate right over the corporate assets,

but then only to the extent of their stockownership.

On Secs. 2 and 3 of Rule 3 & Sec. 2 of Rule 4

Irene's residence is in Makati, not in Batac.

CTC is invalid proof of residence.

Irene argues that co-plaintiffs (new trustees) reside in Batac. the real party-in-interest plaintiff is Irene. As self-styled beneficiary of the

disputed trust, she stands to be benefited or entitled to the avails of

the present suit. It is undisputed too that petitioners Daniel Rubio,

Orlando G. Reslin, and Jose G. Reslin, all from Ilocos Norte, wereincluded as co-plaintiffs in the amended complaint as Irenes new


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designated trustees. As trustees, they can only serve as mere

representatives of Irene.

not one of the three can be considered as principal party-plaintiffs

the word principal has been added [in the uniform procedure rule] in

order to prevent the plaintiff from choosing the residence of a minorplaintiff or defendant as the venue. (J. Feria)

Eliminate the qualifying term principal and the purpose of the Rulewould, to borrow from Justice Regalado, be defeated where a

nominal or formal party is impleaded in the action since the latterwould not have the degree of interest in the subject of the action

which would warrant and entail the desirably active participation

expected of litigants in a case.

As trustees, they may be accorded, by virtue of Sec. 3 of Rule 3, the right

to prosecute a suit, but only on behalf of the beneficiary who must beincluded in the title of the case and shall be deemed to be the realparty-in-interest. In the final analysis, the residences of Irenes co-

plaintiffs cannot be made the basis in determining the venue of thesubject suit.

impleading of the trustees is unnecessary.

Venue is improperly laid.

---

PILTEL vs. Tecson (2004)

1.Causative event

2.Tecson files action for sum of money and damages in RTC Iligan City.

PILTEL files MTD. / DENIED.

PILTEL files MR. / DENIED.

3.PILTEL files petition for certiorari in CA.

CA DISMISSES petition. PILTEL files MR. / DENIED.

4.PILTEL files petition for review in SC.

SC GRANTS petition.

On Sec. 4, Rule 4 & "Mobile Service Agreement"

On contract of adhesion


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valid contract of adhesion: DBP vs. National Merchandising

Corporation:

invalid contract of adhesion: Sweet Lines, Inc. vs. Teves

Causative event: On various dates in 1996, Delfino C. Tecson applied for six(6) cellular phone subscriptions with petitioner Pilipino Telephone

Corporation (PILTEL), a company engaged in the telecommunicationsbusiness, which applications were each approved and covered,

respectively, by six mobiline service agreements.

PILTEL'S MTD:on the ground of improper venue, citing a common provision

in the mobiline service agreements to the effect that -

"Venue of all suits arising from this Agreement or any other suit directly orindirectly arising from the relationship between PILTEL and subscriber shall

be in the proper courts of Makati, Metro Manila. Subscriber hereby expressly

waives any other venues."

Sec. 4, Rule 4 & "Mobile Service Agreement":

Requisites of agreement on venue:

(1) the stipulation on the chosen venue is exclusive in nature or in intent

(2) that it is expressed in writing by the parties thereto, and(3) that it is entered into before the filing of the suit.

The added stipulation that the subscriber "expressly waives any other

venue" should indicate, clearly enough, the intent of the parties to considerthe venue stipulation as being preclusive in character.

Contract of adhesion:

CA: the subscription agreement, being a mere contract of adhesion, doesnot bind respondent on the venue

stipulation.

SC:

such an agreement is not per se inefficacious.

A contract of adhesion is just as binding as ordinary contracts.


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Look at personal circumstances of party.

In the case at bar, subscriber secured six (6) subscription contracts for

cellular phones on various dates. It would be difficult to assume that,

during each of those times, respondent had no sufficient opportunity

to read and go over the terms and conditions embodied in theagreements. Respondent continued, in fact, to acquire in the pursuit

of his business subsequent subscriptions and remained a subscriberof petitioner for quite sometime.

Valid contract of adhesion: DBP vs. National Merchandising Corporation

the contracting parties, being of age and businessmen of experience, were

presumed to have acted with due care and to have signed the assailed

documents with full knowledge of their import.

Invalid contract of adhesion: Sweet Lines, Inc. vs. Teves

the Court took note of an acute shortage in inter-island vessels that left

passengers literally scrambling to secure accommodations and tickets from

crowded and congested counters. Hardly, therefore, were the passengers

accorded a real opportunity to examine the fine prints contained in thetickets, let alone reject them.

CIVPRO Digests Venue PILTEL vs Tecson

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