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TIMES, Inc. vs.

Reyes (1971)
1. Causative event 2. Villegas and Enrile file action for damages for libel against 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 deferment in 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 capacity of 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 coffers contained 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. One government official admitted lending Villegas P30,000 pesos ($7,700) without interest because he was the mayor's compadre. An assistant declared 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 an invasion 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

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 the commission 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's compadre; 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 jurisdiction and 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

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 second option 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 mean that 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 the Philippines 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 be permitted 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 has previously complied with a certain requirement, then such compliance or

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 officers whose 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 jurisdiction may 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, or 2. 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 of offense 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

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 civil action 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 filed in 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 its approval, the newspapermen in the Philippines shall organize, and elect the members of, a Philippine Press Council, a private agency of the said newspapermen, whose function shall be to promulgate a Code of Ethics for them and the Philippine press investigate violations thereof, and censure any 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 its amendments 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 as possible with the discharge of his official duties and labors. The only alternative allowed him by law is to prosecute those responsible

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 inconvenience of 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 rules are not pertinent in the present scheme because the number of causes of action that may be available to the respondents-plaintiffs is not here in issue. 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 a writ 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 the court in which the suit was brought, on a motion to quash service of summons, that it has jurisdiction. On premature petition

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 such motion, so that it may be resolved without waiting for the trial. Thus it has been 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 event 2. Irene Marcos-Araneta files two (2) complaints in RTC for conveyance of

shares of stock, accounting and receivership against the Benedicto group. Francisca Benedicto files MTD, followed by Amended MTD, for the 2 complaints. Irene files Consolidated Opposition. / Benedicto and daughter files Joint Reply to Opposition. / Both cases were consolidated on Benedicto's motion. Benedicto died, substituted by wife and daughter. RTC DISMISSES complaints. 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 Answer just to avoid being in default. 3. Benedicto's file petition for certiorari in 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.


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.
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) and Universal 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, the shares 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 trusteehusband, 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

said 65% shareholdings.

10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27.

Francisca's MTD: (1) the cases involved an intra-corporate dispute over which the Securities and Exchange Commission, not the RTC, has jurisdiction; (2) venue was improperly laid; and (3) the complaint failed to state a cause of action, as there was no allegation therein that plaintiff, as beneficiary of the purported trust, has accepted the trust created in her favor. ISSUE ON VENUE: RTC complaints were filed in Batac, Ilocos Norte. Irene did not maintain residence in said place as she in fact only visited the mansion twice in 1999; that she did not vote in Batac in the 1998 national elections; and that she was staying at her husbands house in Makati City. Benedicto presented joint affidavit of household staff as evidence. Irene presented CTC in Curimao, Ilocos Norte as evidence.

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 order Irene's Amended Complaint: to admit additional plaintiffs, who are Irene's new trustees. RTC's grant of Motion to Admit Amended Complaint: (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. (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.

28. 29. 30. 31. 32. 33. 34.


(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.
37. In said order, the RTC stood pat on its holding on the rule on


amendments of pleadings. And scoffing at the argument about there being 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 the June 29, 2000 order dismissing the original complaints, the court stated thusly: there was actually no need to act on Irenes motion to admit, it being her right as plaintiff to amend her complaints absent any responsive pleading thereto. Pushing its point, the RTC added the 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. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51.

ISSUE 1: Non-Forum Shopping Julia did not sign verification and certification of non-forum shopping. Only Francisca did. CA acted within its sound discretion in ordering the submission of proof of Franciscas authority to sign on Julitas behalf and represent her in the proceedings before the appellate court. Francisca is herself a principal party. This requirement is formal, not jurisdictional. Rules on non-forum shopping signature: if there is commonality of

52. 53. 54. 55. 56. 57. 58. 59. 60. 61.

interest, or if one cause of action, but multiple parties, signature of plaintiff acting as representative, is sufficient compliance. ISSUE 2: Merits CA proceeded to pass on the factual issue of the existence and enforceability of the asserted trust. It overstepped boundaries. ISSUE 3: Admission of Amended Complaint Proper SEC. 2, RULE 10. Amendments as a matter of right. A party may 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 time within ten (10) days after it is served. The MTD is not a responsive pleading.

62. 63. 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, implying that there was strictly no legal impediment to her amending her original complaints.


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

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, meaning within 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, in their 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 in question 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 materially change 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 the corporation 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, were included as co-plaintiffs in the amended complaint as Irenes new

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 minor plaintiff or defendant as the venue. (J. Feria) Eliminate the qualifying term principal and the purpose of the Rule would, to borrow from Justice Regalado, be defeated where a nominal or formal party is impleaded in the action since the latter would 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 be included in the title of the case and shall be deemed to be the real party-in-interest. In the final analysis, the residences of Irenes coplaintiffs cannot be made the basis in determining the venue of the subject 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

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 telecommunications business, 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 or indirectly 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 consider the venue stipulation as being preclusive in character. Contract of adhesion: CA: the subscription agreement, being a mere contract of adhesion, does not 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.

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 the agreements. Respondent continued, in fact, to acquire in the pursuit of his business subsequent subscriptions and remained a subscriber of 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 the tickets, let alone reject them.