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Universal Robina Corporation vs. Lim

*
G.R. No. 154338. October 5, 2007.

UNIVERSAL ROBINA CORPORATION, petitioner, vs.

ALBERT LIM, doing business under the name and style
“New H-R Grocery,” respondent.

Actions; Venue; The parties may agree to a specific venue

which could be in a place where neither of them resides.—In
personal actions, the plaintiff may commence an action either in
the place of his or her residence or the place where the defendant
resides. However, the parties may agree to a specific venue which
could be in a place where neither of them resides.

Same; Same; Motions to Dismiss; A court may not dismiss an

action motu proprio on the ground of improper venue as it is not
one of the grounds wherein the court may dismiss an action motu
proprio on the basis of the pleadings.—Section 1, Rule 9 of the
same Rules provides instances when the trial court may motu
proprio dismiss a claim, thus: Section 1. Defenses and objections
not pleaded.—Defenses and objections not pleaded either in a
motion to dismiss or in the answer are deemed waived. However,
when it appears from the pleadings or the evidence on record that
the court has no jurisdiction over the subject matter, that there is
another action pending between the same parties for the same
cause, or that the action is barred by a prior judgment or by
statute of limitations, the court shall dismiss the claim. Implicit
from the above provision is that improper venue not impleaded in
the motion to dismiss or in the answer is deemed waived. Thus, a
court may not dismiss an action motu proprio on the ground of
improper venue as it is not one of the grounds wherein the court
may dismiss an action motu proprio on the basis of the pleadings.

PETITION for review on certiorari of the resolutions of the

Court of Appeals.

The facts are stated in the opinion of the Court.

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* FIRST DIVISION.

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Universal Robina Corporation vs. Lim

Delos Reyes-Beltran, Miranda-Araneta, Del Rosario Law

Offices for petitioner.
Daniel B. Rubio for private respondent.

SANDOVAL-GUTIERREZ, J.:

Before us is a Petition for Review on Certiorari under Rule

45 of the 1997 Rules of Civil Procedure, as amended,
assailing the Resolutions dated January 16, 2002 and July
1, 2002 of the Court of Appeals in CA-G.R. SP No. 67368.
The present controversy stemmed from a contract of sale
between Universal Robina Corporation, petitioner, and
Albert Lim, respondent. Pursuant to the contract,
petitioner sold to respondent grocery products in the total
amount of P808,059.88. After tendering partial payments,
respondent refused to settle his obligation despite
petitioner’s repeated demands.
Thus, on May 31, 1999, petitioner filed with the
Regional Trial Court, Branch 227, Quezon City, a
complaint against respondent1 for a sum of money, docketed
as Civil Case No. Q-99-37791.
On June 22, 1999, the trial court issued an Order
dismissing the complaint motu proprio on grounds of lack
of jurisdiction and improper venue, thus:

“The case is misplaced with respect to jurisdiction and venue.

There is not even a remote connection by the parties to Quezon
City, where this Regional Trial Court sits, the plaintiff
corporation has principal office at Pasig City and the defendant is,
as provided in the complaint, from Laoag City.
Wherefore, premises considered, this case is hereby
DISMISSED2without prejudice for improper venue and for lack of
jurisdiction.”

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1 Rollo, p. 63.
2 Id., p. 73.

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Universal Robina Corporation vs. Lim

Accordingly, petitioner filed a motion for reconsideration

together with an amended complaint alleging that the
parties agreed that the proper venue for any dispute
relative to the transaction is Quezon City.
In an Order dated October 11, 1999, the trial court
granted the motion and admitted petitioner’s amended
complaint.
On December 6, 1999, summons was served upon
respondent. For his failure to file an answer seasonably
and upon motion of petitioner, the trial court issued an
Order dated September 12, 2000 declaring him in default 3
and allowing petitioner to present its evidence ex parte.
However, on April 17, 2001, the trial court, still unsure
whether venue was properly laid, issued an Order directing
petitioner to file a memorandum of authorities
4
on whether
it can file a complaint in Quezon City. Subsequently, on
May 11, 2001, the trial court again issued an Order
dismissing the complaint on the ground of improper venue,
thus:

“It appears that there is no connection whatsoever between

Quezon City and the parties. Plaintiff’s official place of business is
in Pasig whereas the defendant’s residence is stated to be in
Laoag City—both stipulated in the Complaint. The filing is based
on the stipulation at the back of the delivery receipt that venue
shall be in Quezon City—which is not even stated in the
Complaint nor admitted to have been signed by the defendant.
WHEREFORE, premises considered, venue is hereby declared
to have been improperly laid. This case is 5 hereby dismissed
without prejudice to filing in the proper venue.”

Petitioner filed a motion for reconsideration but it was

denied6
by the trial court in its Resolution dated August 15,
2001.

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3 Id., p. 90.
4 Id., p. 91.
5 Id., p. 61.
6 Id., p. 62.

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Universal Robina Corporation vs. Lim

Petitioner then filed with the Court of Appeals a petition

for review. But it was dismissed due to petitioner’s failure
to attach thereto an explanation why copies of the petition
were not served by personal service but by registered mail,
in violation of Section 11, 7Rule 14 of the 1997 Rules of Civil
Procedure, as amended. Petitioner filed a motion for
reconsideration but it was likewise denied by the appellate
court in a Resolution dated July 1, 2002, thus:

“After a careful assessment of the petitioner’s motion for

reconsideration of the Resolution dated March 21, 2002
dismissing the instant case for failure to comply with Section 11,
Rule 14, this Court finds the reasons therein alleged to be not
well-taken.
Moreover, Supreme Court Circular No. 1-88 and
Administrative Circular No. 3-96, provide that subsequent
compliance with the requirements of a petition for
review/certiorari shall not warrant reconsideration of the order of
dismissal unless the court is fully satisfied that the non-
compliance with the said requirements was not in any way
attributable to the party, despite due negligence on his part, and
that there are highly justifiable and compelling reasons for the
court to make such other disposition as it may deem just and
equitable.
We find such reasons wanting in the present case.
Besides, after a restudy of the facts, law and jurisprudence, as
well as the dispositions already contained in the assailed
Resolutions of public respondent, we find the present petition
for certiorari to be patently without merit, and the
questions raised therein are too unsubstantial to require
consideration.
WHEREFORE, the motion 8 for reconsideration is hereby
DENIED for utter lack of merit.”

Hence, this petition.

The fundamental issue being raised is whether the trial
court may dismiss motu proprio petitioner’s complaint on
the ground of improper venue.

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7 Id., p. 42.
8 Id., p. 31.

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Universal Robina Corporation vs. Lim

Sections 2 and 4, Rule 4 of the same Rules provide:

“Sec. 2. Venue of personal actions.—All other actions may be

commenced and tried where the plaintiff or any of the principal
plaintiffs resides, or where the defendant or any of the principal
defendants resides, or in the case of a non-resident defendant
where he may be found, at the election of the plaintiff.
Sec. 4. When Rule not applicable.—This Rule shall not apply—

(a) In those cases where a specific rule or law provides

otherwise; or
(b) Where the parties have validly agreed in writing
before the filing of the action on the exclusive
venue thereof.”

Clearly, in personal actions, the plaintiff may commence an

action either in the place of his or her residence or the place
where the defendant resides. However, the parties may
agree to a specific venue which could be in a place where
neither of them resides.
Corollarily, Section 1, Rule 9 of the same Rules provides
for the instances when the trial court may motu proprio
dismiss a claim, thus:

“Section 1. Defenses and objections not pleaded.—Defenses and

objections not pleaded either in a motion to dismiss or in the
answer are deemed waived. However, when it appears from the
pleadings or the evidence on record that the court has no
jurisdiction over the subject matter, that there is another action
pending between the same parties for the same cause, or that the
action is barred by a prior judgment or by statute of limitations,
the court shall dismiss the claim.”

Implicit from the above provision is that improper venue

not impleaded in the motion to dismiss or in the answer is
deemed waived. Thus, a court may not dismiss an action
motu proprio on the ground of improper venue as it is not
one of the grounds wherein the court may dismiss an action
motu pro-prio on the basis of the pleadings.
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9
In Dacoycoy v. Intermediate Appellate Court, this Court
held that a trial court may not motu proprio dismiss a
complaint on the ground of improper venue, thus:

“Dismissing the complaint on the ground of improper venue is

certainly not the appropriate course of action at this stage of the
proceedings, particularly as venue, in inferior courts as well as in
the courts of first instance (now RTC), may be waived expressly or
impliedly. Where the defendant fails to challenge timely the
venue in a motion to dismiss as provided by Section 4 of Rule 4 of
the Rules of Court, and allows the trial to be held and a decision
to be rendered, he cannot on appeal or in a special action be
permitted to belatedly challenge the wrong venue, which is
deemed waived.
Indeed, it was grossly erroneous for the trial court to have
taken a procedural short-cut by dismissing motu proprio the
complaint on the ground of improper venue without first allowing
the procedure outlined in the rules of court to take its proper
course. Although we are for the speedy and expeditious resolution
of cases, justice and fairness take primary importance. The ends
of justice require that respondent trial court faithfully adhere to
the rules of procedure to afford not only the defendant, but the
plaintiff as well, the right to be heard on his cause.”

In Rudolf 10Lietz Holdings, Inc. v. Registry of Deeds of

Parañaque, the Court likewise held that a trial court may
not motu proprio dismiss a complaint on the ground of
improper venue, thus:

“Rule 9, Section 1 of the 1997 Rules of Civil Procedure states that

defenses and objections not pleaded either in a motion to dismiss
or in the answer are deemed waived. The court may only
dismiss an action motu proprio in case of lack of
jurisdiction over the subject matter, litis pendentia, res
judicata and prescription. Therefore, the trial court in this
case erred when it dismissed the petition motu proprio. It
should have waited for a motion to dismiss or a responsive
pleading from

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9 G.R. No. 74854, April 2, 1991, 195 SCRA 64.

10 398 Phil. 626; 344 SCRA 680 (2000).

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respondent, raising the objection or affirmative defense of

improper venue, before dismissing the petition.”

In the instant case, respondent, despite proper service of

summons, failed to file an answer and was thus declared in
default by the trial court. Verily, having been declared in
default, he lost his standing in court and 11
his right to
adduce evidence and present his defense, including his
right to question the propriety of the venue of the action.
WHEREFORE, the Petition for Review is GRANTED.
The assailed Resolutions of the Court of Appeals in CA-
G.R. SP No. 67368 are REVERSED. The Regional Trial
Court, Branch 227, Quezon City is ordered to REINSTATE
Civil Case No. Q-99-37791 and conduct an ex parte hearing
for the reception of petitioner’s evidence and dispose of the
case with dispatch.
SO ORDERED.

Puno (C.J., Chairperson), Corona, Azcuna and

Garcia, JJ., concur.

Petition granted, assailed resolutions reversed.

Note.—Personal actions, such as one for declaration of

nullity of marriage, may be commenced and tried where
the plaintiff or any of the principal plaintiffs resides, or
where the defendant or any of the principal defendants
resides, at the election of the plaintiff. (Tamano vs. Ortiz,
291 SCRA 584 [1998])

——o0o——

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11 Rural Bank of Sta. Catalina v. Land Bank of the Philippines, G.R.

No. 148019, July 26, 2004, 435 SCRA 183.

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