FIRST
DIVISION
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PHILIPPINE BANK OF COMMUNICATIONS and
ROMEO G. DELA
Petitioners, - versus
- ELENITA B. TRAZO, Respondent. |
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G.R. No. 165500 Present: PANGANIBAN, C.J. Chairperson, YNARES-SANTIAGO, AUSTRIA-MARTINEZ, CALLEJO,
SR., and CHICO-NAZARIO,
JJ. Promulgated: August 30, 2006 |
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CHICO-NAZARIO, J.:
Petitioners are asking Us to reverse,
in this Petition for review on certiorari
under Rule 45 of the 1997 Rules of Civil Procedure, the Decision[1] of
the Court of Appeals dated
The facts of the case are as follows:
In order to facilitate the payment of
her salaries and other monetary benefits from her employer, petitioner Philippine
Bank of Communications (PBCOM[3]), respondent
Elenita B. Trazo opened a payroll account with China Banking Corporation (CBC)
under Current Account No. 101-003921-9.
On
or about 29 December 1997, petitioner Romeo G. dela Rosa, PBCOM assistant
vice-president, instructed CBC to credit all accounts under its payroll with
the medical and clothing subsidy for the year 1998. Accordingly, respondent Trazo’s current
account was credited on that date with the amount of P7,000.00 for such
annual subsidy.
On
Since
respondent Trazo severed her employment with PBCOM effective 1 January 1998 and
was, therefore, no longer entitled to the medical and clothing subsidy for the
year 1998, petitioner dela Rosa wrote William Lim, CBC senior assistant
vice-president, on 5 January 1997 authorizing/directing CBC/Lim to debit the
sum of P7,000.00 from respondent Trazo’s current account. Acting upon such authority/directive, CBC/Lim
debited said amount from respondent Trazo’s account on the same date.
Meanwhile,
respondent Trazo drew checks against her current account in favor of Bliss
Development Corporation (BDC) and the House of Sara Lee Phils., Inc. However, the checks were dishonored by CBC
due to insufficiency of funds, which was occasioned by the P7,000.00
debit from her current account.
Averring
that PBCOM, through dela Rosa, had no authority to unilaterally order the
debiting of her current account and that CBC, through Lim, made such debit
without her knowledge and consent resulting in the dishonor of her checks, respondent
Trazo instituted an action for damages against PBCOM, dela Rosa, CBC, and Lim
before the Regional Trial Court (RTC) of Quezon City (Branch 79).
Summons
was served on CBC and Lim on
On
On
On
PREMISES
CONSIDERED, the case against defendants China Bank and William Lim is DISMISSED
on the ground of improper venue. The
case against defendants Philippine Bank of Communications and Romeo G. dela
Respondent
Trazo filed with the trial court a Notice of Appeal. In the assailed Decision, the Court of
Appeals ruled in favor of respondent Trazo, disposing of the case in the following
manner:
WHEREFORE,
the omnibus order dated
Petitioners
filed their Motion for Reconsideration on
Hence,
the instant Petition, where petitioners PBCOM and Trazo bring before us the
following issues:
A.
WHETHER OR
NOT THE COURT OF APPEALS ERRED IN RULING THAT THE COMPLAINT STATED A CAUSE OF
ACTION FOR DAMAGES AGAINST PETITIONERS ARISING OUT OF THE ALLEGED UNLAWFUL
DEBITING OF RESPONDENT’S CHINABANK ACCOUNT, NOTWITHSTANDING THAT IT WAS
CHINABANK WHICH DEBITED THE ACCOUNT, NOT PETITIONERS.
B.
WHETHER OR
NOT THE COURT OF APPEALS ERRED IN HOLDING THAT THE COMPLAINT PLEADED A CAUSE OF
ACTION FOR ABUSE OF RIGHTS AGAINST PETITIONERS.
C.
WHETHER OR
NOT THE COURT OF APPEALS ERRED IN ORDERING THE AMENDMENT OF THE COMPLAINT
DESPITE THE COMPLAINT’S ABSOLUTE FAILURE TO STATE A CAUSE OF ACTION AGAINST
PETTIONERS.
D.
WHETHER OR NOT
THE COURT OF APPEALS ERRED IN FINDING THAT THE VENUE CLAUSE IN THE APPLICATION
FOR NEW CURRENT ACCOUNTS IS NOT EXCLUSIVE.[6]
Only CBC,
and not petitioners PBCOM and dela
The Application for New Current
Accounts, which embodies the terms and conditions of respondent Trazo’s
relationship with CBC, contains a stipulation on venue, to wit:
In
case of litigation hereunder, venue shall be in the City Court or Court of
First Instance of Manila as the case may be for determination of any and all
questions arising thereunder.[7]
The RTC of Quezon City dismissed the
complaint against CBC and Lim based on this stipulation, but the Court of
Appeals reversed said dismissal. According
to the Court of Appeals, absent any qualifying or restrictive words, a
stipulation on venue should be considered merely as an agreement on an additional
forum, and not to be considered as limiting venue to the specified place.[8]
Before
proceeding any further, it bears to point out that among the multiple
defendants in the case filed by respondent Trazo, only CBC and its officer Lim
can assert the alleged impropriety of venue since they are privy to and covered
by the contract containing the venue stipulation. Indeed, the dispositive portion of the RTC
decision shows that the dismissal on the ground of improper venue was effective
only as against CBC and Lim. As CBC and
Lim did not appeal the decision of the Court of Appeals reversing the RTC
ruling, such decision has become final and executory as regards its disposition
on the issue regarding venue.
Nevertheless, We agree with the Court
of Appeals that it was incorrect for the RTC to dismiss the complaint on the
ground of improper venue. The parties
must be able to show that the stipulation is exclusive. Thus, sans words expressing the parties’
intention to restrict the filing of a suit in a particular place, courts will
allow the filing of a case in any of the venues prescribed by law or stipulated
by the parties, as long as the jurisdictional requirements are followed.[9] The subject clause contains no qualifying nor
restrictive words, such as “must,” or “exclusively,” as would indicate the
parties’ intention “mandatorily to restrict the venue of actions to the courts
of (
Respondent
Trazo’s complaint contains a cause of action against petitioners PBCOM and dela
As
discussed above, the RTC dismissed the complaint, insofar as it operates
against CBC and Lim, on the ground of improper venue. In the same Omnibus Order, the RTC also
dismissed the same complaint on the ground of failure to state a cause of
action, this time, insofar as the complaint operates against petitioners PBCOM
and dela
Par. 13 of the complaint recites appellant’s alleged
cause of action against [PBCOM and dela
“13. Upon further personal inquiry
with [PBCOM], [respondent Trazo] found out that on January 5, 1998 [petitioner]
ROMEO G. DE LA ROSA, without [respondent Trazo’s] knowledge, consent and
approval, wrote a letter and authorized/directed x x x CHINABANK and WILLIAM
LIM `to debit the account of Elenita Trazo under C/A #101-003921-9 in the
amount of PESOS: SEVEN THOUSAND PESOS ONLY – P7,000.00 representing her
medical and clothing subsidy for the year 1998.’ He even acknowledged and admitted that [respondent
Trazo] resigned from PBCom effective
Crucial to appellant’s action against [PBCOM and dela P7,000.00 from appellant’s current account
and, if so, whether appellant was entitled to notice of such
authority/directive.
In
authorizing/directing [CBC and Lim] to debit appellant’s current account, [PBCOM
and dela
Nevertheless,
the lower court ruled that the averment in par. 13 of the complaint is
insufficient to make out a cause of action against [PBCOM and dela Rosa] on the
theory that the “debit (of) the amount of P7,000.00 from the account
of [respondent Trazo] x x x cannot be
attributed as the fault of (PBCOM) since the fiduciary relationship exists only
between (CBC) and [respondent Trazo] as its depositor and the primary
responsibility whether to deposit or not lies with (CBC) alone.”
However,
the lower court did not consider whether the act of authorizing/directing
CBC/Lim to debit appellant’s current account without giving notice to her
constitutes a cause of action against [PBCOM and dela Rosa], for abuse of
rights.
The
modern tendency is to depart from the classical and traditional theory and to
grant indemnity for damages in cases where there is an abuse of rights, even
when the act is not illicit (Sea
Commercial Company, Inc. vs. Court of Appeals, 319 SCRA 210). But even supposing that the asserted act of [PBCOM
and dela
Amendment
of the complaint, by way of supplementing and amplifying facts as would carve
out a clear abuse of rights situation, would prevent multiplicity of
suits. This is so because of Our ruling
that the dismissal of the complaint against [CBC and Lim] on ground of improper
venue is erroneous, with the effect that the complaint against them is
reinstated. However, affirmance of the
dismissal of the complaint against [PBCOM and dela
Amendment,
not dismissal, of the complaint is proper to avoid multiplicity of suits (Eugenio, Sr. vs. Velez, 185 SCRA
425). The policy in this jurisdiction is
that amendment of pleadings is favored and liberally allowed in the interest of
substantial justice. Amendment of the
complaint may be allowed even if an order for its dismissal has been issued
provided that the motion to amend is filed before the order of dismissal
acquired finality (Tirona vs. Alejo, 367
SCRA 17). Rules of Procedure, after all,
are but tools designed to facilitate the attainment of justice (Valenzuela vs. Court of Appeals, 363
SCRA 779).[15]
Petitioners
argue that the afore-quoted paragraph 13 shows that PBCOM and dela Rosa merely
requested CBC to debit the account of respondent Trazo, and that nothing in
said paragraph shows that PBCOM and dela Rosa were actually responsible for the
alleged unlawful debiting of respondent’s account.[16]
As
regards the Court of Appeals’ finding that the complaint contains a cause of
action against petitioners for abuse of rights,[17]
petitioners claim that the elements of abuse of rights are not found in the
complaint, since no bad faith was imputed to PBCOM and dela Rosa in requesting
the debiting of the amount stated, and since there was no allegation showing
that PBCOM and dela Rosa acted with the sole intent of prejudicing or injuring
respondent in requesting the same.[18]
While we agree with petitioners that
the complaint does not contain a cause of action against them for abuse of
rights, their petition would, nonetheless, fail.
A
cause of action is an act or omission of one party in violation of the legal
right of the other.[19] A motion to dismiss based on lack of cause of
action hypothetically admits the truth of the allegations in the complaint.[20] The allegations in a complaint are sufficient
to constitute a cause of action against the defendants if, hypothetically admitting
the facts alleged, the court can render a valid judgment upon the same in accordance
with the prayer therein. A cause of
action exists if the following elements are present, namely: (1) a right in favor of the plaintiff by
whatever means and under whatever law it arises or is created; (2) an
obligation on the part of the named defendant to respect or not to violate such
right; and (3) an act or omission on the part of such defendant violative of
the right of the plaintiff or constituting a breach of the obligation of the
defendant to the plaintiff for which the latter may maintain an action for
recovery of damages.[21]
The
Court of Appeals, like the RTC, seems to have acquiesced in the petitioners’
statement[22] that
respondent’s cause of action against them is found exclusively in paragraph 13 of the complaint. An examination of the subject complaint,[23]
however, reveals that it contains other provisions establishing the cause of
action against petitioners PBCOM and de la Rosa, not the least of which is paragraph
23, which provides:
23. In
debiting the checking/current account of the plaintiff, without her knowledge,
consent and approval, defendants acted in a wanton, reckless and oppressive
manner. Defendants PBCOM and ROMEO G. DE
LA ROSA had no cause nor reason to unilaterally order the debiting of
plaintiff’s account as it was her personal property and not of defendant PBCOM. Even if defendant PBCOM erroneously credited
plaintiff with monetary benefits, plaintiff was to receive, as she did receive
separation benefits equivalent to more than FIVE HUNDRED THOUSAND PESOS
(P500,000.00) more or less, from defendant PBCOM itself. A reasonable set-off or compensation should
and could have been resorted to.
However, defendant PBCOM never utilized this option. Defendant PBCOM neither informed plaintiff of
said transaction, much less seek her approval and authority to debit her
CHINABANK account when at the time of the debitting (sic),
As regards
respondent Trazo’s entitlement to damages, the complaint recites that:
In
order not to jeopardize her housing loan obligations with BDC and Sara Lee,
Phil., Inc., and considering the legal actions foisted against her, x x x [respondent
Trazo] made immediate restitution to BDC and Sara Lee Phil., Inc. for her
outstanding obligations, which included unwarranted charges and penalties which
were not [respondent Trazo’s] making.[25]
The Complaint
also claims that the actions of defendants therein, including petitioners PBCOM
and dela
On January 5, 1997, you, as AVP of PBCOM’s
Human Resource Management Department, authorized CHINA BANKING CORPORATION to
debit our client’s account under C/A # 101-003921-9 in the amount of SEVEN
THOUSAND PESOS (P7,000.00), representing her medical and clothing subsidy for
the year 1998, without notifying our client, much less acquiring her consent
and approval. However, our client
resigned from PBCOM effective
As a result of your action[,] our client
incurred damages and injury in several personal transactions involving check
payments made by her under said checking account with CHINA BANKING
CORPORATION. This unfortunate incident
caused her untold sufferings, not to mention lost opportunities in her
profession and other businesses, besmirched reputation, sleepless nights,
mental anguish and wounded feelings.[27]
Paragraph
20[28]
of the complaint makes its Annex K an integral part thereof.
We find a
sufficient cause of action in the above-quoted allegations. If these allegations are assumed to be true,
respondent Trazo would indeed be entitled to damages, though the amount of the
same would still depend on the evidence presented during trial.
We carefully scrutinize the
allegations in the Complaint. It provides that “(d)efendants PBCOM and ROMEO G.
DE LA ROSA had no cause nor reason to unilaterally order the debitting
(sic) of plaintiff’s account as it was her personal property and not of
defendant PBCOM.”[29] The Complaint also described the action of
all defendants, including petitioners PBCOM and dela
In the case at bar, the allegations
in the complaint verily show a cause of action.
To sustain a motion to dismiss for lack of cause of action, the Complaint
must show that the claim for relief does not exist rather than that a claim has
been defectively stated or is ambiguous, indefinite or uncertain.[33]
We,
however, disagree with the Court of Appeals when it decided that the allegations in the complaint show
a cause of action against petitioners for abuse of rights under Article 19[34]
of the Civil Code. The elements of abuse
of rights are: (1) a legal right or duty; (2) which is
exercised in bad faith; and (3) for the sole intent of prejudicing or injuring
another.[35] Rather, the allegations bare commission of an
act contrary to law under Article 20 of the same Code, which provides:
Art. 20. Every person who, contrary to
law, wilfully or negligently causes damage to another, shall indemnify the
latter for the same.
Whereas Article 19 provides for a
cause of action for damages in cases when there is no law violated, the act
causing damage being within rights or duties of defendant, Article 20 furnishes
a general sanction for violations of provisions of law which do not especially
provide their own sanction.[36] The complaint clearly alleges a violation of
respondent Trazo’s property rights with respect to her checking account. Article 429 of the Civil Code provides that
the owner or lawful possessor of the thing has the right to exclude any person
from the enjoyment and disposal thereof.
Petitioners retort that the complaint
did not base its claim for damages on Articles 19, 20 and 21 of the Civil Code,[37]
and faults the Court of Appeals for making out “a cause of action for
respondent on grounds not even alleged in the Complaint.[38] We, however, have held in Consolidated Dairy Products, Co. v. Court of
Appeals,[39]
that the applicable law to a set of facts stated in the complaint need not be
set out directly. Consequently, the
complaint need not state that the property right alleged to have been violated
is found in Article 429 of the Civil Code, or that such violation entitled
petitioner Trazo to damages pursuant to Article 20 of the same Code, which
provides a cause of action therefor.
Petitioners’
claim that respondent failed to specify in the complaint the standard of proper
conduct and decency required of PBCOM and the basis of invoking such standard
on PBCOM[40]
did not improve their position any. The
complaint should state only ultimate facts, not conclusions of law, nor
evidentiary facts. In determining whether the allegations
of a complaint are sufficient to support a cause of action, the complaint does
not have to establish or allege the facts proving the existence of a cause of
action at the outset; this will have to be done at the trial on the merits of the
case.[41] Ultimate facts refer to the principal,
determinative, constitutive facts upon the existence of which the cause of
action rests. The term does not refer to
details of probative matter or particulars of evidence which establish the
material ingredients.[42]
In
their last ditch efforts to save their cause, petitioners assert that the duty
to notify respondent regarding the debiting of her account properly belongs to
CBC[43]
and that, had CBC denied petitioners’ “request,” then there would have been no
alleged debit of respondent’s account.[44] Petitioners add that the mere act of “requesting”
a bank to return a certain amount of money erroneously credited to one of the
bank’s depositors cannot be considered an act which violates the rights of said
depositor.[45]
Petitioners’ allegations are in the
nature of defenses, and, thus, cannot be considered in determining the
sufficiency of the cause of action. For the
complaint to be dismissed for failure to state the cause of action, the
insufficiency of the cause of action must appear on the face of the complaint.[46]
If the allegations in a complaint can furnish a sufficient
basis by which the complaint can be maintained, the same should not be
dismissed regardless of the defenses that may be assessed by the defendants.[47]
WHEREFORE, the instant petition is DENIED for lack of merit. The assailed Decision and Resolution of the
Court of Appeals, which reversed and set aside the Regional Trial Court of
Quezon City’s
SO ORDERED.
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MINITA V. CHICO-NAZARIOAssociate Justice |
WE
CONCUR:
Chief Justice
Chairperson
Associate
Justice Associate
Justice
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ROMEO J.
CALLEJO, SR. Associate Justice |
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Pursuant to Article VIII,
Section 13 of the Constitution, it is hereby certified that the conclusions in
the above Decision were reached in consultation before the case was assigned to
the writer of the opinion of the Court’s Division.
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ARTEMIO V.
PANGANIBAN Chief Justice |
[1] CA-G.R. CV No. 61726, penned by
Associate Justice Edgardo P. Cruz with Associate Justices Ruben T. Reyes and
Noel G. Tijam, concurring; Rollo, pp.
42-50.
[2]
[3] Referred to as “PBCom” in some portions of the Rollo.
[4] Rollo, p. 55.
[5]
[6]
[7] Records, p. 83.
[8] Philippine Banking Corporation v. Tensuan, G.R. No. 104649,
[9] Mangila v. Court of Appeals, 435 Phil. 870, 884 (2002).
[10] Philippine
Banking Corporation v. Tensuan, G.R. No. 106920,
[11] G.R. No. 139437,
[12] Id. at 554-555: “It is hereby agreed that in case of foreclosure of this mortgage under Act 3135, as amended, and Presidential Decree No. 385, the auction sale shall be held at the capital of the province, if the property is within the territorial jurisdiction of the province concerned, or shall be held in the city, if the property is within the territorial jurisdiction of the city concerned.”
[13]
[14]
[15] Rollo,
pp. 48-50.
[16]
[17]
[18]
[19] Bachrach
Corporation v. Court of Appeals, G.R. No. 128349,
[20] Sta. Clara Homeowners’ Association v. Spouses Gaston, 425 Phil. 221, 227 (2002).
[21] Del Bros Hotel Corporation v. Court of Appeals, G.R. No. 87675, 16 June 1992, 210 SCRA 33, 41; Development Bank of the Philippines v. Pundogar, G.R. No. 96921, 29 January 1993, 218 SCRA 118, 143; Dulay v. Court of Appeals, 313 Phil. 8, 20 (1995).
[22] Rollo, p. 355: “The only allegation upon which Respondent hinges her cause of action against DELA ROSA and PBCOM is found in Paragraph 13 of her complaint, which states: x x x”
[23] Rollo, pp. 166-177.
[24]
[25]
[26]
[27]
[28] Paragraph 20 reads in full: “20.
After several consultations with lawyers and legal consultants, including the
undersigned, a demand letter was issued through Pangulayan and Associates Law
Offices, to defendants CHINABANK, WILLIAM LIM, PBCOM and ROMEO G. DE LA ROSA.
Copies of the demand letter together with the Registry Receipts and personal
acknowledgment of receipt by the defendants are attached hereto as Annexes “I”,
“J” and “K” respectively and made integral parts hereof.” (Rollo,
p. 171.)
[29] Rollo, pp. 171-172.
[30]
[31]
[32] Article 429 of the Civil Code provides that “(t)he owner or lawful possessor of a thing has the right to exclude any person from the enjoyment and disposal thereof.”
[33] Azur
v. Provincial Board, 136 Phil. 301, 308 (1969).
[34] Art. 19. Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith.
[35] Sea Commercial Company, Inc. v. Court of Appeals, 377 Phil. 221, 230 (1999); Albenson Enterprises Corp. v. Court of Appeals, G.R. No. 88694, 11 January 1993, 217 SCRA 16, 25.
[36] Albenson Enterprises Corp. v. Court of Appeals, id.
[37] Rollo, p. 360.
[38]
[39] G.R. No. 100401,
[40] Rollo, p. 14.
[41]
[42]
[43] Rollo, p. 357.
[44]
[45]
[46] Consolidated Dairy Products v. Court of Appeals, supra note 39; Peltran Development, Inc. v. Court of Appeals, 336 Phil. 824, 833 (1997).
[47] Rava
Development Corporation v. Court of Appeals, G.R. No. 96825,