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FLUOR DANIEL, INC.- Petitioner, |
G.R. No. 159648
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- versus - |
Present: QUISUMBING, J., Chairperson, CARPIO, CARPIO MORALES, TINGA, and
VELASCO, JR., JJ. |
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E.B.
VILLAROSA & PARTNERS CO., LTD., Respondent. |
Promulgated: July 27, 2007 |
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QUISUMBING, J.:
For review on certiorari are the Decision[1] dated October 24, 2002 and the Resolution[2] dated August 25, 2003 of the Court of Appeals in CA-G.R. SP No. 52897, which had affirmed the November 19, 1998[3] and March 24, 1999[4] Orders of the Regional Trial Court of Makati City, Branch 58, in Civil Case No. 98-1342.
The pertinent facts, borne by the records, are as follows.
Petitioner Fluor Daniel, Inc.-
On
Petitioner apprised Fil-Estate that the project would have to be suspended. Petitioner likewise issued a notice of suspension of work to all its contractors, including respondent. In response, respondent informed petitioner that it deemed the contracts between them good as terminated. Thus, respondent demanded payment for suspension cost and for work so far performed.
Believing that petitioner was in bad faith, respondent also filed with the Regional Trial Court of Makati City, Branch 58, a complaint[5] for a sum of money and damages, docketed as Civil Case No. 98-1342.
Petitioner filed a motion to dismiss[6] on the ground that the complaint failed to state a cause of action. The trial court denied the motion in its first assailed Order, to wit:
WHEREFORE, foregoing considered, defendant’s motion to
dismiss is hereby DENIED.
Pursuant to Section 4 of Rule 16, 1997 Rules of Civil
Procedure, defendant-movant shall file its answer within the balance of the
period prescribed by Rule 11, same Rules, to which defendant was entitled at
the time of serving its motion, but not less than five (5) days in any event,
computed from receipt of this order.
SO ORDERED.[7]
Petitioner’s motion for reconsideration was likewise denied in the trial court’s second impugned Order, thus:
WHEREFORE, foregoing considered, defendant’s Motion
for Reconsideration is hereby DENIED.
The filing of the last pleading and the consequent
joinder of issues has ripened this case for pre-trial which is hereby set…
Let notices of pre-trial be sent to the parties and
their counsel.
SO ORDERED.[8]
Respondent subsequently filed a motion to amend its complaint followed by its amended complaint. Petitioner, on the other hand, filed a motion to suspend proceedings. The trial court granted respondent’s, but denied petitioner’s motion, to wit:
WHEREFORE,
in view of the foregoing:
1)
Plaintiff’s
Urgent Motion to Amend Complaint With Leave of Court is hereby GRANTED.
Accordingly, plaintiff’s Amended Complaint filed on
2)
Defendant’s
Motion to Suspend Proceedings is hereby DENIED.
SO
ORDERED.[9]
Petitioner filed with the Court of Appeals a special
civil action for certiorari assailing the
WHEREFORE, the Order dated
Accordingly, the temporary restraining order issued by
the Ninth Division of this Court as contained in Resolution dated
Costs against petitioner.
SO ORDERED.[10]
Hence, the instant petition, raising the following issues:
I.
Whether or not the Complaint
sufficiently states a cause of action against FDIP [PETITIONER] in light of the
jurisprudential tests and guidelines laid down by this
Honorable Court.
II.
Whether or not the annexes
attached to the Complaint should be considered in determining whether or not
VILLAROSA’s [RESPONDENT’S] Complaint sufficiently stated a cause of action
against FDIP in light of jurisprudential tests and guidelines laid down by this
Honorable Court.
III.
Whether or not the Court of
Appeals, in refusing to consider the annexes to the Complaint, erred in failing
to appreciate the clear admission of VILLAROSA [RESPONDENT] that payment of its
IV.
Whether or
not the Court of Appeals, in refusing to consider the annexes to the Complaint,
failed to appreciate the significance of VILLAROSA’s [RESPONDENT’S] failure to
satisfy the required criteria to justify payment under its monthly progress
Petitioner contends that the complaint utterly and miserably failed to state the operative facts which would give rise to a cause of action against it. Petitioner insists that the annexes attached to respondent’s complaint and other pleadings should be considered in determining respondent’s cause of action, or lack of it, against petitioner. Petitioner maintains that the Court of Appeals committed manifest error when it refused to consider the annexes to the complaint, showing respondent’s admission that payment of its billings was subject to the condition of timely receipt of similar payments from petitioner.
Respondent, however, counters that its complaint sufficiently stated a cause of action against petitioner and that the annexes attached to the complaint bear no relevance, not having been admitted by stipulation. Respondent asserts that the three elements of a cause of action are all present in this case, namely: (i) legal right of respondent to demand payment from petitioner; (ii) obligation of petitioner to pay respondent; and (iii) failure of petitioner to pay respondent. Respondent stresses that petitioner cannot evade its liability to pay by claiming that payments to respondent are subject to timely receipt of similar payments from Fil-Estate.
The petition is impressed with merit.
Section
2, Rule 2 of the Rules of Civil Procedure provides:
SEC. 2. Cause of action, defined.
– A cause of action is the act or omission by which a party violates a right of
another.
The essential
elements of a cause of action are as follows: 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 defendant not to violate such right; and 3) An act or
omission on the part of the defendant in violation 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 or other
relief.[12]
It is, thus, only upon the
occurrence of the last element that a cause of action arises, giving the plaintiff a right to file an
action in court for recovery of damages or other relief.[13] The test of sufficiency of facts alleged in
the complaint as constituting a cause of action is whether or not admitting the
facts alleged, the court could render a valid verdict in accordance with the
prayer of the complaint.[14] That in determining sufficiency of cause of
action, the court takes into account only the material allegations of the complaint
and no other, is not a hard and fast rule.
In some cases, the court considers the documents attached to the
complaint to truly determine sufficiency of cause of
action.[15]
We have ruled that a complaint should not be dismissed for insufficiency of cause of action if it appears clearly from the complaint and its attachments that the plaintiff is entitled to relief.[16] The converse is also true. The complaint may be dismissed for lack of cause of action if it is obvious from the complaint and its annexes that the plaintiff is not entitled to any relief.
In this case, we
note that annexed to the subject complaint are the three contracts governing
the rights and obligations between petitioner and respondent, namely the
contract for civil structure and architecture, the contract for plumbing
and fire protection, and the contract for millworks. Records show that recurring in each of the said
contracts is the provision that payment by petitioner shall be subject to its
timely receipt of similar payments from Fil-Estate. The said provision, found in each of the aforesaid
contracts, is quoted below:
2.0 PRICING BASIS
The Contract Price set forth
herein is firm for the duration of the Work and includes all Contractor’s
costs, expenses, overhead and profit for complete performance of the Work.
x x x x
…Payment of the billings
shall be subject to the timely receipt of similar payments from the client by
Fluor Daniel. Any prolonged delay in
payment by Fluor Daniel is subject to a suspension of activities by EBV within
five (5) work days after proper written notice is provided by contractor to
Fluor Daniel.[17] (Emphasis
supplied.)
On their
face, the said attached contracts, which define and delimit the rights and
obligations of the parties, clearly require a specific condition before
petitioner may be held liable for payment. The complaint, however, failed to state that
the said condition had been fulfilled. Without
the said condition having taken place, petitioner cannot be said to have
breached its obligation to pay.
We thus hold
that respondent’s complaint, taken with the contracts annexed to it, failed to
pass the test of sufficiency of cause of action. Thus, the said complaint should have been
dismissed on the ground of failure to state a cause of action.
WHEREFORE, the petition is GRANTED. The assailed Decision dated
Costs against respondent.
SO ORDERED.
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LEONARDO A.
QUISUMBING Associate Justice |
WE CONCUR:
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ANTONIO T.
CARPIO Associate Justice |
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CONCHITA
CARPIO MORALES Associate Justice |
DANTE
O. TINGA Associate Justice |
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PRESBITERO
J. VELASCO, JR. Associate Justice |
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A T T E S T A T I O N
I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.
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LEONARDO A.
QUISUMBING Associate Justice Chairperson |
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson’s Attestation, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court’s Division.
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REYNATO S. PUNO Chief Justice |
[1] Rollo, pp. 57-74. Penned by Associate Justice Bienvenido L. Reyes, with Associate Justices Romeo A. Brawner and Mario L. Guariña III concurring.
[2]
[3]
[4]
[5]
[6]
[7]
[8]
[9]
[10]
[11]
[12] Swagman Hotels and Travel, Inc. v. Court of Appeals, G.R. No. 161135, April 8, 2005, 455 SCRA 175, 183.
[13]
[14] Misamis Occidental II Cooperative, Inc. v. David, G.R. No. 129928,
[15] Jimenez, Jr. v. Jordana, G.R. No.
152526,
[16] Alberto v. Court of Appeals, G.R. No.
119088,
[17] Rollo, p. 118.