THIRD DIVISION
EMILIO S. YOUNG,
Petitioner,
G.R.
No.
143464
March 5, 2003
-versus-
JOHN KENG SENG
A.K.A.
JOHN SY,
Respondent.
D E C I S I O N
PANGANIBAN,
J.:chanroblesvirtuallawlibrary
In general, violation of
the rule on forum shopping should be raised at the earliest opportunity
in a motion to dismiss or a similar pleading. Invoking it
in
the later stages of the proceedings or on appeal may result in the
dismissal
of the action as an exception only if the violation arises from or will
result in (1) the loss of jurisdiction over the subject matter,
(2)
the pendency of another action between the same parties for the same
cause,
(3) the barring of the action by a prior judgment, or (4) the crossing
of the Statute of Limitations. The Case
Before us is a Petition
for Review on Certiorari under Rule 45 of the Rules of Court, seeking
to
set aside the February 24, 2000 Decision and the May 26, 2000
Resolution
of the Court of Appeals (CA)[1]
in CA-GR SP No. 52976. The decretal portion of the assailed
Decision
reads as follows:
"WHEREFORE, the petition
at bench is DISMISSED. Costs against the petitioner."[2]chanrobles virtuallaw libraryred
The assailed Resolution[3]
denied petitioner's Motion for Reconsideration.
The Facts
The factual antecedents
are summarized by the CA as follows:
"On September 16, 1996,
the herein private respondent John Keng Seng, a.k.a. John Sy, filed a
complaint
for ‘accounting of general agency, injunction, turning over of
properties,
and damages,' with the Regional Trial Court of Bacolod City,
Branch
53, against the herein petitioner Emilio Young and his wife, Tita
Young.
The case was docketed thereat as Civil Case No. 96-9508. The
private
respondent subsequently filed an Amended Complaint with the same
Court.
The spouses Young, for their part, filed a Motion to Dismiss the case
for
lack of cause of action.cralaw:red
"On March 6, 1997, the
Regional Trial Court of Bacolod City, Branch 53, issued an order
dismissing
Civil Case No. 96-9508. The private respondent's Motion for
Reconsideration
of the aforesaid order was denied by the same court in its Order of
April
2, 1997.cralaw:red
"On June 23, 1997, John
Keng Seng filed another complaint for accounting and damages with the
Regional
Trial Court of Bacolod City, Branch 44, against the herein petitioner
Emilio
Young. The case was docketed in that court as Civil Case No.
97-9830.
Young filed a Motion to Dismiss the case on the ground that the
‘complaint
fails to state a good, valid and/or worthwhile cause of action against
the defendant.' The respondent court denied the Motion to Dismiss
in its order of August 19, 1997. The petitioner filed a Motion
for
Reconsideration of the aforesaid order based on the following grounds:
‘The complainant x x
x fails to state a good, valid and/or worthwhile cause of action as
against
the defendant.cralaw:red
‘and
‘Plaintiff had fatally
failed to comply with the rule against forum shopping, as he has in
fact
deliberately submitted a false certification under oath as contained in
the complaint in the present suit.'chanrobles virtuallaw libraryred
"The private respondent
having filed his ‘Opposition to Motion for Reconsideration,' and the
petitioner,
his Reply, the presiding judge of the Regional Trial Court of
Negros
Occidental, Branch 44, Bacolod City, Judge Anastacio I. Lobaton, issued
an order x x x date[d] September 23, 1997 granting the petitioner's
Motion
for Reconsideration and dismissing Civil Case No. 97-9830. To
this,
the private respondent filed a Motion for Reconsideration; to which,
the
petitioner, in turn, tendered an Opposition.cralaw:red
"On October 24, 1997,
Judge A.I. Lobaton inhibited himself from the case, thusly—
‘WHEREFORE, undersigned
inhibits himself from hearing the cases wherein John Keng Seng is one
of
the parties and let the following records be forwarded to the Office of
the Clerk of Court of RTC, Bacolod City for re-raffle.cralaw:red
‘SO ORDERED.cralaw:red
‘Bacolod City, October
24, 1997.cralaw:red
‘(SGD) ANASTACIO I.
LOBATON
‘Presiding Judge'
"On December 16, 1998,
the herein public respondent Judge Demosthenes L. Magallanes, the
presiding
judge of the respondent Branch 54, Regional Trial Court of Bacolod
City,
to whom the present case was re-raffled, issued an order, the decretal
part of which reads:
‘THEREFORE, in the light
of the foregoing consideration, this Court is of the opinion that the
herein
plaintiff had not violated the rule on forum shopping. The order
dated September 23, 1998 is therefore RECONSIDERED. The Clerk of
Court is hereby directed to set the case for further proceedings.cralaw:red
‘SO ORDERED.cralaw:red
‘Bacolod City, Philippines,
December 16, 1998.cralaw:red
‘(SGD) DEMOSTHENES L.
MAGALLANES
‘Judge'
"The petitioner moved
for reconsideration of the above order, but his motion was [denied] by
the respondent court x x x in its order of April 23, 1999." (Citations
omitted)[4]chanrobles virtuallaw libraryred
Ruling of the
Court
of Appeals
In dismissing petitioner's
appeal, the CA ruled that respondent did not violate the rule on forum
shopping, since Civil Case No. 96-9508 (the "First Case") had been
dismissed
by the RTC on March 6, 1997; while Civil Case No. 97-9830 (the "Second
Case") had been filed only on June 23, 1997. It further
held
that failure to state a cause of action -- the ground on which
petitioner
based his Motion to Dismiss -- "[did] not, and [could not], bar the
refiling
of the same action or claim."[5]
Hence, this Petition.[6]
The Issues
In his Memorandum,[7]
petitioner assigns this lone error for the Court's consideration:
"Whether or not in holding
that respondent has not violated the rule against forum shopping
notwithstanding
and despite the record clearly showing and the trial court itself
having
categorically found via its Order of Sept. 23, 1997 there to have been
the willful and deliberate submission of a false certification (against
forum shopping) as well as non-compliance with the undertaking under
Rule
7, Sec. 5 of the Rules of Court, the Court of Appeals had decided a
question
of substance in a way not in accord with law, that law being the rule
abovementioned
and jurisprudence; as well as had sanctioned a substantial departure
from
the accepted and usual course of judicial proceedings as to warrant the
exercise by this Honorable Tribunal of its supervisory powers
thereover."[8]
(Citation omitted)
On the other hand, respondent
raises these two issues before us:
"I. Whether
or not the Court of Appeals has sanctioned a substantial departure from
the accepted and usual course of judicial proceedings in upholding the
order dated September 16, 1998 in Civil Case No. 97-9830 of Hon. Judge
Demosthenes Magallanes denying petitioner's motion to dismiss on the
alleged
ground of forum shopping; and
"II. Whether or
not
the petitioner is deemed to have waived the right to invoke forum
shopping
as a ground for a motion to dismiss in Civil Case No. 97-9830."[9]
For purposes of
clarity,
we deem it wise to discuss the issues as follows: (1) whether
petitioner
can still raise the alleged violation of the rule on non-forum
shopping,
even if he failed to cite it as a ground in his Motion to Dismiss the
Second
Case; (2) whether the CA erred in holding that respondent had not
violated
the rule on forum shopping; and (3) whether such violation warrants the
automatic dismissal of the Second Case. The Court's Ruling
The Petition is not
meritorious. We sustain respondent, but not for the reasons given
by the Court of Appeals or the Regional Trial Court.cralaw:red
First Issue:
Waiver
Petitioner contends
that the CA should have ordered the dismissal of the Second Case.
Allegedly,
respondent was guilty of forum shopping when he deliberately and
willfully
submitted a false certification of non-forum shopping.[10]chanrobles virtuallaw libraryred
On the other hand, respondent
claims that petitioner waived this ground by failing to raise it in his
Motion to Dismiss before the trial court.cralaw:red
Section 1 of Rule 9
of the Rules of Court provides that defenses and objections not pleaded
in a motion to dismiss or in an answer are deemed waived.
However,
courts shall nonetheless dismiss the claim when it appears from the
pleadings
or the evidence on record that (1) the court has no jurisdiction over
the
subject matter, (2) there is another action pending between the same
parties
for the same cause, (3) the action is barred by prior judgment, or 4)
the
statute of limitations has been crossed.cralaw:red
Bolstering this provision
is Section 8 of Rule 15 which states: "Subject to the
provisions
of Section 1 of Rule 9, a motion attacking a pleading, order, judgment,
or proceeding shall include all objections then available, and all
objections
not so included shall be deemed waived."
Applying these principles
to the instant case, we hold that petitioner is barred from raising the
ground of forum shopping in the Court of Appeals and in this
Court.
If only for his failure to invoke such ground at the first opportunity
in his Motion to Dismiss filed in the trial court,[11]
his appeal should have been given short shrift and denied outright.cralaw:red
However, we deem it
wise to give due course to the Petition herein to discuss -- for the
benefit
of the bench and the bar -- the interrelated issues of whether
respondent
violated the rule on non-forum shopping, and whether such violation
warrants
the automatic dismissal of the present case.cralaw:red
Second and Third
Issues:
Forum Shopping
Petitioner avers that
respondent violated the rule on non-forum shopping when he knowingly,
deliberately
and willfully certified falsely under oath that he had not commenced
any
other action or petition before any court, tribunal or agency involving
the same issue.chanrobles virtuallaw libraryred
It is said that forum
shopping is committed by a party who, having received an adverse
judgment
in one forum, seeks another opinion in another court, other than by
appeal
or the special civil action of certiorari. More accurately,
however,
forum shopping is the institution of two or more suits in different
courts,
either simultaneously or successively, in order to ask the courts to
rule
on the same or related causes and/or to grant the same or substantially
the same reliefs.[12]
It is an act of malpractice that is prohibited and condemned because it
trifles with the courts and abuses their processes. It degrades
the
administration of justice and adds to the already congested court
dockets.[13]
To stamp out this abominable
practice of trifling with the administration of justice, the Supreme
Court
promulgated Administrative Circulars 28-91 and 04-94, which are now
embodied
as Section 5 of Rule 7 of the Rules of Court, which we reproduce as
follows:
"SEC. 5. Certification
against forum shopping. - The plaintiff or principal party shall
certify
under oath in the complaint or other initiatory pleading asserting a
claim
for relief, or in a sworn certification annexed thereto and
simultaneously
filed therewith: (a) that he has not theretofore commenced any action
or
filed any claim involving the same issues in any court, tribunal or
quasi-judicial
agency and, to the best of his knowledge, no such other action or claim
is pending therein; (b) if there is such other pending action or claim,
a complete statement of the present status thereof; and (c) if he
should
thereafter learn that the same or similar action or claim has been
filed
or is pending, he shall report that fact within five (5) days therefrom
to the court wherein his aforesaid complaint or initiatory pleading has
been filed.cralaw:red
"Failure to comply with
the foregoing requirements shall not be curable by mere amendment of
the
complaint or other initiatory pleading but shall be cause for the
dismissal
of the case without prejudice, unless otherwise provided, upon motion
and
after hearing. The submission of a false certification or
non-compliance
with any of the undertakings therein shall constitute indirect contempt
of court, without prejudice to the corresponding administrative and
criminal
actions. If the acts of the party or his counsel clearly
constitute
willful and deliberate forum shopping, the same shall be ground for
summary
dismissal with prejudice and shall constitute direct contempt, as well
as a cause for administrative sanctions."
In dismissing a case
based on forum shopping, it is important to consider the "vexation
caused
[to] the courts and parties-litigants by a party who asks different
courts
to rule on the same or related causes or grant the same or
substantially
the same reliefs."[14]
Thus, to determine whether a party violated the rule against forum
shopping,
the most important factor to ask is whether the elements of litis
pendentia[15]
are present, or whether a final judgment in one case will amount to res
judicata[16]
in another.[17]
Otherwise stated, the test for determining forum shopping is whether in
the two (or more) cases pending, there is identity of parties, rights
or
causes of action, and reliefs sought.[18]chanrobles virtuallaw libraryred
In First Philippine
International Bank v. Court of Appeals,[19]
the test for determining the presence of forum shopping was explained
by
the Court as follows:
"The test for determining
whether a party violated the rule against forum shopping has been
laid down in the 1986 case of Buan v. Lopez, x x x by Chief Justice
Narvasa,
and that is, forum shopping exists where the elements of litis
pendentia
are present or where a final judgment in one case will amount to res
judicata
in the other, as follows:
‘There thus exists between
the action before this Court and the RTC Case No. 86-36563 identity of
parties, or at least such parties as represent the same interests in
both
action, as well as identity of rights asserted and relief prayed for,
the
relief being founded on the same facts, and the identity on the two
preceding
particulars is such that any judgment rendered in the other action,
will,
regardless of which party is successful, amount to res adjudicata in
the
action under consideration: all the requisites, in fine, of auter
action
pendant.'
x x
x
x x
x
x x x
‘As already observed,
there is between the action at bar and the RTC Case No. 86-36563, an
identity
as regards parties, or interests represented, rights asserted and
relief
sought, as well as basis thereof, to a degree sufficient to give rise
to
the ground for dismissal known as auter action pendant or lis pendens.
That same identity puts into operation the sanction of twin dismissals
just mentioned. The application of this sanction will prevent any
further
delay in the settlement of the controversy which might ensue from
attempts
to seek reconsideration of or to appeal from the Order of the Regional
Trial Court in Civil Case No. 86-36563 promulgated on July 15, 1986,
which
dismissed the petition upon grounds which appear persuasive.'
"Consequently, where
a litigant (or one representing the same interest or person) sues the
same
party against whom another action or actions for the alleged violation
of the same right and the enforcement of the same relief is/are still
pending,
the defense of litis pendentia in one case is a bar to the others; and,
a final judgment in one would constitute res judicata and thus would
cause
the dismissal of the rest. In either case, forum shopping could be
cited
by the other party as a ground to ask for summary dismissal of the two
(or more) complaints or petitions, which are direct contempt of court,
criminal prosecution, and disciplinary action against the erring
lawyer."[20]chanrobles virtuallaw libraryred
Ruling that respondent
was not guilty of forum shopping, the RTC issued its Order dated
December
16, 1998, in which it said:
"A close scrutiny of
the records shows that Civil Case No. 96-9508 was dismissed on March 6,
1997; Civil Case No. 97-9830 was filed on June 23, 1997, more than two
months after the first dismissal. This shows that when the latter case
was filed, the previous case was no longer pending. In short, the
element
of litis pendentia is not present under the circumstances.cralaw:red
"As to the second element,
since the dismissal in Civil Case No. 96-9508 is based on the theory
that
the complaint did not state a cause of action then it does not bar the
plaintiff from refiling the same action or claim with the proper
allegations
showing a valid cause of action. No res judicata would arise in one
action
as to the other.cralaw:red
"THEREFORE, in light
of the foregoing consideration, this Court is of the opinion that the
herein
plaintiff has not violated the rule on forum shopping. x x x"
This holding was sustained
by the CA. We opine, however, that a perusal of respondent's
certification
shows that there was a violation of the rule on non-forum
shopping.
The certification is hereunder quoted verbatim:
"5. That I hereby certify
that I have not commenced any other action or petition before any
court,
tribunal or agency involving the same issue and to the best of my
knowledge,
no such action or proceeding is pending in the Supreme Court, Court of
Appeals, Regional Trial Court or any other tribunal or agency and that
if I should learn of any action filed in said office I will accordingly
informed [sic] this Hon. Court of said action and the status therein
within
five (5) days from knowledge thereof."[21]chanrobles virtuallaw libraryred
The foregoing certification
is obviously inaccurate, if not downright false, because it does not
disclose
the filing of the First Case. Had this violation been
appropriately
brought up in the Motion to Dismiss, it could have resulted in the
abatement
of the Second Case.cralaw:red
Nonetheless, strengthening
our ruling on the First Issue, we hold that substantial justice[22]
requires the resolution of the present controversy on its merits.
It must be noted that the verification requirement is a formal, not a
jurisdictional,
requirement.[23]
Moreover, the ground for the dismissal of the First Case was lack of
cause
of action, which means that essentially, no case was filed, because the
Complaint was fatally defective on its face. Hence, its dismissal
was not determinative of the Second Case.[24]
We repeat: the First
Case was dismissed because of lack of cause of action. It was
thus
a dismissal without prejudice; respondent was not barred from filing a
new suit against petitioner involving the same facts, but raising a
cause
of action arising therefrom. In fact, respondent actually filed
the
Second Case, even if he failed to disclose in his certification that he
had commenced the First Case against the same defendant, herein
petitioner.
Furthermore, we must bear in mind that, whenever possible and feasible,
procedural rules should be liberally construed to ensure the just,
speedy
and inexpensive disposition of actions and proceedings on their merits.[25]
In Loyola v. Court of
Appeals,[26]
we said that the rule on non-forum shopping was designed to promote and
facilitate the orderly administration of justice and, therefore, should
not be interpreted literally at all times.chanrobles virtuallaw libraryred
"The fact that the Circular
requires that it be strictly complied with merely underscores its
mandatory
nature in that it cannot be dispensed with or its requirements
altogether
disregarded, but it does not thereby interdict substantial compliance
with
its provisions under justifiable circumstances."[27]
WHEREFORE, the Petition
is DENIED and the assailed Decision AFFIRMED. The trial court is
DIRECTED to hear the controversy and decide it with all deliberate
speed.
Costs against petitioner.cralaw:red
SO ORDERED.cralaw:red
Puno, J., (Chairman),
Sandoval-Gutierrez
and Carpio-Morales, JJ.,
concur.
Corona, J.,
on leave.cralaw:red
____________________________
Endnotes:
[1]
Third Division. Penned by Justice Renato C. Dacudao (member); concurred
in by Justices Quirino D. Abad Santos Jr. (Division chairman) and B.A.
Adefuin-de la Cruz (member).
[2]
Assailed CA Decision, p. 6; rollo, p. 120.
[3]
Rollo, pp. 128-129.chanrobles virtuallaw libraryred
[4]
Assailed CA Decision, pp. 1-4; rollo, pp. 115-118.
[5]
Id., pp. 5 & 119.chanrobles virtuallaw libraryred
[6]
The case was deemed submitted on April 26, 2001, upon this Court's
receipt
of respondent's Memorandum signed by Atty. Edmundo G. Manlapao.
Petitioner's
Memorandum, signed by Atty. Benjamin L. Hilado of Hilado, Hagad
&
Hilado, was received by the Court on April 17, 2001.
[7]
Rollo, pp. 155-177.chanrobles virtuallaw libraryred
[8]
Id., p. 162. Original in upper case.
[9]
Respondent's Memorandum, p. 8; rollo, 186.
10
Id., pp. 48-50.chanrobles virtuallaw libraryred
11
Cf. Annex I of Motion to Dismiss dated July 27, 1997; CA rollo, pp.
141-144.chanrobles virtuallaw libraryred
[12]
Executive Secretary v. Gordon, 298 SCRA 736, 741, November 18, 1998;
First
Philippine International Bank v. Court of Appeals, 252 SCRA 259, 283,
January
24, 1996; Chemphil Export & Import Corporation v. Court of Appeals,
251 SCRA 257, 291-292, December 12, 1995; International Container
Terminal
Services, Inc. v. Court of Appeals, 249 SCRA 389, 395-396, October 18,
1995.
[13]
Executive Secretary v. Gordon, supra; Chemphil Export & Import
Corporation
v. Court of Appeals, supra.chanrobles virtuallaw libraryred
[14]
Roxas v. Court of Appeals, 363 SCRA 207, 218, August 15, 2001, per de
Leon
Jr., J.chanrobles virtuallaw libraryred
[15]
Before the pendency of one action can operate to abate a second one,
there
must be (1) substantial identity of the parties and (2)
substantial
identity of causes of action and of the issues. J. Northcott & Co.,
v. Villa-Abrille, 41 Phil. 462, March 17, 1921.
[16]
For the principle of res judicata to apply, the following elements must
be present: (1) there is a decision on the merits; (2) it was rendered
by a court of competent jurisdiction; (3) the decision is final; and
(4)
the two actions involve identical parties, subject matter and causes of
action. Roxas v. Court of Appeals, supra, p. 218.chanrobles virtuallaw libraryred
[17]
Spouses Tirona v. Alejo, GR No. 129313, October 10, 2001.chanrobles virtuallaw libraryred
[18]
Employees Compensation Commission v. Court of Appeals, 257 SCRA 717,
723,
June 28, 1996; Buan v. Lopez Jr., 145 SCRA 34, 38, October 13, 1986.
[19]
Supra.chanrobles virtuallaw libraryred
[20]
Id., pp. 283-284, per Panganiban, J.
[21]
Appendix "E," Complaint, p. 4; CA rollo, p. 44.
[22]
Basco v. Court of Appeals, 326 SCRA 768, February 29, 2000;
Magno-Adamos
v. Bagasao, 162 SCRA 747, June 28, 1988; Beutifont Inc. v. Court of
Appeals,
157 SCRA 481, January 29, 1988; Lianga Bay Logging Co., Inc. v, Court
of
Appeals, 157 SCRA 357, January 28, 1988, Francisco v. City of Davao, 12
SCRA 628, December 24, 1964.
[23]
Quimpo v. Dela Victoria, 46 SCRA 139, 144, July 31, 1972.chanrobles virtuallaw libraryred
[24]
On the other hand, the present Rule on forum shopping gives petitioner
remedies other than the denial of the present Petition.
[25]
Section 6, Rule 1 of Rules of Court.chanrobles virtuallaw libraryred
[26]
245 SCRA 477, June 29, 1995.
[27]
Id., pp. 483-484, per Davide Jr. (later CJ). |