Republic of the
Supreme Court
THIRD DIVISION
|
SEAOIL PETROLEUM
CORPORATION, Petitioner, - versus - AUTOCORP GROUP and PAUL Y.
RODRIGUEZ, Respondents. |
G.R. No. 164326
Present: YNARES-SANTIAGO, J., Chairperson, AUSTRIA-MARTINEZ, AZCUNA,* CHICO-NAZARIO, and NACHURA, JJ. Promulgated: October
17, 2008 |
x------------------------------------------------------------------------------------x
DECISION
NACHURA, J.:
Before this Court is a Petition for
Review on Certiorari under Rule 45 of
the Rules of Court assailing the Decision[1] of
the Court of Appeals (CA) dated May 20, 2004 in CA-G.R. CV No. 72193, which had
affirmed in toto the Decision[2] of
the Regional Trial Court (RTC) of Pasig City, Branch 157, dated September 10,
2001 in Civil Case No. 64943.
The factual antecedents, as summarized
by the CA, are as follows:
On P2,500,000.00 but was increased to P3,112,519.94
because it was paid in 12 monthly installments up to P259,376.62 each with
Autocorp as payee.
The
excavator was subsequently delivered on
The
relationship started to turn sour when the first check bounced. However, it was
remedied when Seaoil replaced it with a good check. The second check likewise
was also good when presented for payment. However, the remaining 10 checks were
not honored by the bank since Seaoil requested that payment be stopped. It was downhill
from thereon.
Despite
repeated demands, Seaoil refused to pay the remaining balance of P2,593,766.20.
Hence, on
Seaoil,
on the other hand, alleges that the transaction is not as simple as described
above. It claims that Seaoil and Autocorp were only utilized as conduits to
settle the obligation of one foreign entity named Uniline Asia (herein referred
to as Uniline), in favor of another foreign entity, Focus Point International,
Incorporated (Focus for short). Paul Rodriguez (Rodriguez for brevity) is a
stockholder and director of Autocorp. He is also the owner of Uniline. On the
other hand, Yu is the president and stockholder of Seaoil and is at the same
time owner of Focus. Allegedly, Uniline chartered MV Asia Property (sic) in the
amount of $315,711.71 from its owner Focus. Uniline was not able to settle the
said amount. Hence, Uniline, through Rodriguez, proposed to settle the
obligation through conveyance of vehicles and heavy equipment. Consequently,
four units of Tatamobile pick-up trucks procured from Autocorp were conveyed to
Focus as partial payment. The excavator in controversy was allegedly one part
of the vehicles conveyed to Focus. Seaoil claims that Rodriguez initially
issued 12 postdated checks in favor of Autocorp as payment for the excavator.
However, due to the fact that it was company policy for Autocorp not to honor
postdated checks issued by its own directors, Rodriguez requested Yu to issue
12 PBCOM postdated checks in favor of Autocorp. In turn, said checks would be
funded by the corresponding 12 Monte de Piedad postdated checks issued by
Rodriguez. These Monte de Piedad checks were postdated three days prior to the
maturity of the PBCOM checks.
Seaoil
claims that Rodriguez issued a stop payment order on the ten checks thus
constraining the former to also order a stop payment order on the PBCOM checks.
In short, Seaoil claims that the real transaction is that Uniline, through Rodriguez, owed money to Focus. In lieu of payment, Uniline instead agreed to convey the excavator to Focus. This was to be paid by checks issued by Seaoil but which in turn were to be funded by checks issued by Uniline. x x x[3]
As narrated above, respondent
Autocorp filed a Complaint for Recovery of Personal Property with Damages and
Replevin[4]
against Seaoil before the RTC of Pasig City. In its
WHEREFORE,
judgment is hereby rendered in favor of plaintiff Autocorp Group and against
defendant Seaoil Petroleum Corporation which is hereby directed to pay
plaintiff:
-
P2,389,179.23 plus 3% interest
from the time of judicial demand until full payment; and
-
25% of the total amount due as attorney’s
fees and cost of litigation.
The
third-party complaint filed by defendant Seaoil Petroleum Corporation against
third-party defendant Paul Rodriguez is hereby DISMISSED for lack of merit.
SO ORDERED.
Seaoil filed a Petition for Review
before the CA. In its assailed Decision, the CA dismissed the petition and
affirmed the RTC’s Decision in toto.[6] It
held that the transaction between Yu and Rodriguez was merely verbal. This
cannot alter the sales contract between Seaoil and Autocorp as this will run
counter to the parol evidence rule which prohibits the introduction of oral and
parol evidence to modify the terms of the contract. The claim that it falls under
the exceptions to the parol evidence rule has not been sufficiently proven.
Moreover, it held that Autocorp’s separate corporate personality cannot be
disregarded and the veil of corporate fiction pierced. Seaoil was not able to
show that Autocorp was merely an alter ego of Uniline or that both corporations
were utilized to perpetrate a fraud. Lastly, it held that the RTC was correct in
dismissing the third-party complaint since it did not arise out of the same
transaction on which the plaintiff’s claim is based, or that the third party’s
claim, although arising out of another transaction, is connected to the
plaintiff’s claim. Besides, the CA said, such claim may be enforced in a
separate action.
Seaoil now comes before this Court in
a Petition for Review raising the following issues:
I
Whether or not the
Court of Appeals erred in partially applying the parol evidence rule to prove only
some terms contained in one portion of the document but disregarded the rule
with respect to another but substantial portion or entry also contained in the
same document which should have proven the true nature of the transaction
involved.
II
Whether or not the
Court of Appeals gravely erred in its judgment based on misapprehension of
facts when it declared absence of facts which are contradicted by presence of
evidence on record.
III
Whether or not the
dismissal of the third-party complaint would have the legal effect of res
judicata as would unjustly preclude petitioner from enforcing its claim against
respondent Rodriguez (third-party defendant) in a separate action.
IV
Whether or not, given the facts in evidence, the lower courts should have pierced the corporate veil.
The Petition lacks merit. We sustain
the ruling of the CA.
We find no fault in the trial court’s
appreciation of the facts of this case. The findings of fact of the trial court
are conclusive upon this Court, especially when affirmed by the CA. None of the
exceptions to this well-settled rule has been shown to exist in this case.
Petitioner
does not question the validity of the vehicle sales invoice but merely argues
that the same does not reflect the true agreement of the parties. However, petitioner only had its bare
testimony to back up the alleged arrangement with Rodriguez.
The Monte
de Piedad checks – the supposedly “clear and obvious link”[7]
between the documentary evidence and the true transaction between the parties –
are equivocal at best. There is nothing in those checks to establish such link.
Rodriguez denies that there is such an agreement.
Unsubstantiated testimony,
offered as proof of verbal agreements which tends to vary the terms of a
written agreement, is inadmissible under the parol evidence rule.[8]
Rule 130, Section 9 of the Revised Rules on Evidence embodies the parol
evidence rule and states:
SEC. 9. Evidence of written
agreements.—When the terms of an agreement have been reduced to writing, it
is considered as containing all the terms agreed upon and there can be, between
the parties and their successors-in-interest, no evidence of such terms other
than the contents of the written agreement.
However, a party may present
evidence to modify, explain or add to the terms of the written agreement if he
puts in issue in his pleading:
(a) An intrinsic ambiguity, mistake or imperfection in the written agreement;
(b) The failure of the written agreement to express the true intent and agreement of the parties thereto;
(c) The validity of the written
agreement; or
(d) The existence of other terms
agreed to by the parties or their successors-in-interest after the execution of
the written agreement.
The term "agreement" includes wills.
The parol evidence rule
forbids any addition to,
or contradiction of, the terms of a written agreement by testimony or other
evidence purporting to show that different terms were agreed upon
by the parties, varying
the purport of the written contract.[9]
This principle notwithstanding, petitioner
would have the Court rule that this case falls within the exceptions,
particularly that the written agreement failed to express the true intent and
agreement of the parties. This argument is untenable.
Although parol evidence
is admissible to explain the meaning of
a contract, it cannot serve the purpose of incorporating into the contract additional contemporaneous
conditions which are not mentioned at all in the writing unless there has been
fraud or mistake.[10]
Evidence of a prior or contemporaneous verbal agreement is generally not
admissible to vary, contradict or defeat the operation of a valid contract.[11]
The
Vehicle Sales Invoice[12]
is the best evidence of the transaction. A sales invoice is a commercial
document. Commercial documents or papers are those used by merchants or
businessmen to promote or facilitate trade or credit transactions.[13]
Business forms, e.g., order slip,
delivery charge invoice and the like, are commonly recognized in ordinary
commercial transactions as valid between the parties and, at the very least,
they serve as an acknowledgment that a business transaction has in fact
transpired.[14] These documents are not mere scraps of paper
bereft of probative value, but vital pieces of evidence of commercial
transactions. They are written memorials of the details of the consummation of
contracts.[15]
The
terms of the subject sales invoice are clear. They show that Autocorp sold to
Seaoil one unit Robex 200 LC Excavator paid for by checks issued by one Romeo Valera.
This does not, however, change the fact that Seaoil Petroleum Corporation, as
represented by Yu, is the customer or buyer. The moment a party affixes his or her signature
thereon, he or she is bound by all the terms stipulated therein and is subject to
all the legal obligations that may arise from their breach.[16]
Oral testimony on the
alleged conditions, coming from a party who has an interest in the outcome of
the case, depending exclusively on human memory, is not as reliable as written
or documentary evidence.[17]
Hence,
petitioner’s contention that the document falls within the exception to the
parol evidence rule is untenable. The exception obtains only where “the written contract is so ambiguous or obscure in
terms that the contractual intention of the parties cannot be understood from a
mere reading of the instrument. In such a case, extrinsic evidence of the
subject matter of the contract, of the relations of the parties to each other,
and of the facts and circumstances surrounding them when they entered into the
contract may be received to enable the court to make a proper interpretation of
the instrument.”[18]
Even assuming there is a shred of
truth to petitioner’s contention, the same cannot be made a basis for holding
respondents liable therefor.
As pointed out by the CA, Rodriguez
is a person separate and independent from Autocorp. Whatever obligations
Rodriguez contracted cannot be attributed to Autocorp[19]
and vice versa. In fact, the obligation that petitioner proffers as its defense
– under the Lease Purchase Agreement – was not even incurred by Rodriguez or by
Autocorp but by Uniline.
The Lease Purchase Agreement[20]
clearly shows that the parties thereto are two corporations not parties to this
case: Focus Point and Uniline. Under this Lease Purchase Agreement, it is
Uniline, as lessee/purchaser, and not Rodriguez, that incurred the debt to
Focus Point. The obligation of Uniline to
Focus Point arose out of a transaction completely different from the subject of
the instant case.
It is settled that a corporation has
a personality separate and distinct from its individual stockholders or
members, and is not affected by the personal rights, obligations and
transactions of the latter.[21] The
corporation may not be held liable for the obligations of the persons composing
it, and neither can its stockholders be held liable for its obligation.[22]
Of course, this Court has
recognized instances when the corporation’s separate personality may be
disregarded. However, we have also held that the same may only be done in cases
where the corporate vehicle is being used to defeat public convenience, justify
wrong, protect fraud, or defend crime.[23]
Moreover, the wrongdoing must be clearly and convincingly established. It cannot be presumed.[24]
To reiterate, the
transaction under the Vehicle Sales Invoice is separate and distinct from that
under the Lease Purchase Agreement. In
the former, it is Seaoil that owes Autocorp, while in the latter, Uniline
incurred obligations to Focus. There was
never any allegation, much less any evidence, that Autocorp was merely an alter
ego of Uniline, or that the two corporations’ separate personalities were being
used as a means to perpetrate fraud or wrongdoing.
Moreover, Rodriguez, as stockholder and
director of Uniline, cannot be held personally liable for the debts of the
corporation, which has a separate legal personality of its own. While Section
31 of the Corporation Code[25] lays down the exceptions
to the rule, the same does not apply in this case. Section 31 makes a director
personally liable for corporate debts if he willfully and knowingly votes for
or assents to patently unlawful acts of the corporation. Section 31 also makes a director personally
liable if he is guilty of gross negligence or bad faith in directing the
affairs of the corporation.[26] The bad faith or
wrongdoing of the director must be established clearly and convincingly. Bad
faith is never presumed.[27]
The burden of proving bad faith or
wrongdoing on the part of Rodriguez was, on petitioner, a burden which it
failed to discharge. Thus, it was proper for the trial court to have dismissed
the third-party complaint against Rodriguez on the ground that he was not a
party to the sale of the excavator.
Rule 6, Section 11 of the Revised
Rules on Civil Procedure defines a third-party complaint as a claim that a
defending party may, with leave of court, file against a person not a party to
the action, called the third-party defendant, for contribution, indemnity,
subrogation or any other relief, in respect of his opponent’s claim.
The purpose of the rule is to permit a defendant to assert an
independent claim against a third party which he, otherwise, would assert in
another action, thus preventing multiplicity of suits.[28]
Had it not been for the rule, the claim could have been filed separately from
the original complaint.[29]
Petitioner’s claim against Rodriguez
was fully ventilated in the proceedings before the trial court, tried and
decided on its merits. The trial court’s ruling operates as res judicata against another suit
involving the same parties and same cause of action. This is rightly so because the trial court found that Rodriguez was
not a party to the sale of the excavator. On the other hand, petitioner
Seaoil’s liability has been successfully established by respondent.
A last point. We reject Seaoil’s
claim that “the ownership of the subject excavator, having been legally and
completely transferred to Focus Point International, Inc., cannot be subject of
replevin and plaintiff [herein respondent Autocorp] is not legally entitled to
any writ of replevin.”[30] The
claim is negated by the sales invoice which clearly states that “[u]ntil after
the vehicle is fully paid inclusive of bank clearing time, it remains the
property of Autocorp Group which reserves the right to take possession of said
vehicle at any time and place without prior notice.”[31]
Considering, first, that Focus Point
was not a party to the sale of the excavator and, second, that Seaoil indeed
failed to pay for the excavator in full, the same still rightfully belongs to
Autocorp. Additionally, as the trial court found, Seaoil had already assigned
the same to its contractor for the construction of its depot in Batangas.[32]
Hence, Seaoil has already enjoyed the benefit of the transaction even as it has
not complied with its obligation. It cannot be permitted to unjustly enrich
itself at the expense of another.
WHEREFORE, the foregoing premises
considered, the Petition is hereby DENIED.
The Decision of the Court of Appeals dated
SO ORDERED.
ANTONIO
EDUARDO B. NACHURA
Associate
Justice
WE CONCUR:
CONSUELO YNARES-SANTIAGO
Associate
Justice
Chairperson
|
MA. ALICIA
AUSTRIA-MARTINEZ Associate Justice |
ADOLFO S. AZC Associate Justice |
MINITA V. CHICO-NAZARIO
Associate Justice
A T T E S T A T I O N
I attest 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.
CONSUELO
YNARES-SANTIAGO
Associate
Justice
Chairperson,
Third Division
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.
REYNATO
S. PUNO
Chief
Justice
*
Additional member replacing
Associate Justice Ruben T. Reyes per Special Order dated
[1] Penned by Associate Justice
Mariano C. Del Castillo, with Associate Justices Marina L. Buzon and Noel G.
Tijam, concurring; rollo, pp. 26-37.
[2] Penned by Judge Esperanza
Fabon-Victorino, id. at 44-52.
[3]
[4] Records, pp. 1-9.
[5] Rollo, p. 50.
[6]
[7]
[8] Spouses Sabio v. The International Corporate
Bank, Inc., 416 Phil. 785, 816 (2001), citing Aerospace Chemical Industries, Inc. v. Court of Appeals, 315 SCRA
92, 107 (1999).
[9] Spouses Edrada v. Spouses Ramos, G.R. No. 154413,
[10] Ortañez v. CA, 334
Phil. 519 (1997), citing Pioneer
Savings and Loan Bank v. Court
of Appeals, 226 SCRA 740, 744 (1993).
[11] Lapulapu Foundation, Inc. v. Court of
Appeals, 466 Phil. 53, 62 (2004), citing
MC Engineering v. CA, 380 SCRA
116 (2002).
[12] Records, p. 22.
[13] Monteverde v.
People, 435 Phil. 906, 921 (2002), citing Reyes,
The Revised Penal Code, Book II, 1998 ed., p. 235.
[14] Donato C. Cruz Trading Corporation v. Court
of Appeals, 400 Phil. 776, 782 (2000).
[15] Monteverde v.
People, supra note 13, citing Lagon v.
Hooven Comalco Industries, Inc., 349 SCRA 363, 379 (2001).
[16] Camacho
v. Court of Appeals, G.R. No. 127520,
[17] Pilipinas Bank v. Court of Appeals, 395
Phil. 751, 757-758 (2000), citing Ortañez
v. CA, supra note 10.
[18] Ortañez v. CA, supra note 10, citing Heirs
of del Rosario v. Santos,
194 Phil. 671, 687 (1981).
[19] Rollo, p. 33.
[20] Records, p. 514.
[21] Philippine National Bank v. Ritrato Group,
Inc., 414 Phil. 494, 503 (2001), citing Yutivo
Sons Hardware Company v. Court
of Tax Appeals, 1 SCRA 160 (1961). See also Elcee Farms, Inc., v. National Labor Relations Commission, G.R. No.
126428,
[22] Padilla v. Court of Appeals, 421 Phil. 883, 895 (2001).
[23]
[24] Padilla v. Court of
Appeals, supra note 22.
[25] Liability
of directors, trustees or officers.
- Directors or trustees who
willfully and knowingly vote for or assent to patently unlawful acts of the
corporation or who are guilty of gross negligence or bad faith in directing the
affairs of the corporation or acquire any personal or pecuniary interest in
conflict with their duty as such directors or trustees shall be liable jointly
and severally for all damages resulting therefrom suffered by the corporation,
its stockholders or members and other persons.
[26] Carag
v. National Labor Relations Commission, G.R.
No. 147590,
[27]
[28] Asian Construction and Development
Corporation v. Court of Appeals, G.R. No. 160242,
[29]
[30] Records, p. 79.
[31]
[32] Rollo,
p. 51.