Case-11.docx
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GOODLAND COMPANY, INC., Petitioner,
- versus -
ASIA UNITED BANK,et al., Respondents. G.R. No. 195561
March 14, 2012 VILLARAMA, JR., J.: Background of the case A Third Party REM was executed by the petitioner over its 5,801-square meter property located at Pasong Tamo St., Makati City (Makati Property) covered by TCT No. 114645. The REM was signed by Gilbert G. Guy, President of Goodland Company, Inc., and were duly registered by AUB with the Registry of Deeds for Makati City. Subsequently, however, petitioner repudiated the REMs by claiming that AUB and its officers unlawfully filled up the blank mortgage forms and falsified the entries therein. Facts: Petitioner filed the first suit docketed as Civil Case No. 03-045 of the RTC of Makati City, alleging that Mr. Guy signed the blank REM deed with the understanding that the document shall not be completed and not to be registered with the Register of Deeds as it would only serve as comfort document to prove petitioners willingness to execute a REM in the future if so demanded by AUB. Petitioner thus prayed for the REM to be declared null and void, and accordingly cancelled.
Petitioner then filed the second case against herein respondents docketed as Civil Case No. 06-1032 of RTC of Makati City, Branch 145. Whereas the earlier case (Civil Case No. 03045) sought the annulment of the REM based on alleged irregularities in its execution, Civil Case No. 06-1032 prayed for injunctive relief and/or nullification of the extrajudicial foreclosure sale which petitioner alleged to be procedurally and legally defective as it is based on a null and void registration/annotation of a falsified Real Estate Mortgage.
Respondents then filed a motion to dismiss and contended that petitioner is guilty of forum shopping, as it has previously filed a case for the annulment of the REM (Civil Case No. 03-045) which is pending before Branch 56.
Issue: whether petitioner was guilty of forum shopping when it successively filed Civil Case No. 03-045 and Civil Case No. 06-1032. Ruling: petitioner was guilty of forum shopping because the identity of the causes of action in the two cases entails that the validity of the mortgage will be ruled upon in both, and creates a possibility that the two rulings will conflict with each other. This is precisely what is sought to be avoided by the rule against forum shopping. There is forum shopping when the following elements are present: (a) identity of parties, or at least such parties as represent the same interests in both actions[;] (b) identity of rights asserted and relief prayed for, the relief being founded on the same facts[;] and (c) the identity of the two preceding particulars[,] such that any judgment rendered in the other action will, regardless of which party is successful, amount to res judicata in the action under consideration. The cause of action in the earlier Annulment Case is the alleged nullity of the REM (due to its allegedly falsified or spurious nature) which is allegedly violative of Goodlands right to the mortgaged property. It serves as the basis for the prayer for the nullification of the REM. The Injunction Case involves the same cause of action, inasmuch as it also invokes the nullity of the REM as the basis for the prayer for the nullification of the extrajudicial foreclosure and for injunction against consolidation of title. While the main relief sought in the Annulment Case (nullification of the REM) is ostensibly different from the main relief sought in the Injunction Case (nullification of the extrajudicial foreclosure and injunction against consolidation of title), the cause of action which serves as the basis for the said reliefs remains the same the alleged nullity of the REM. Thus, what is involved here is the third way of committing forum shopping, i.e., filing multiple cases based on the same cause of action, but with different prayers. As previously held by the Court, there is still forum shopping even if the reliefs prayed for in the two cases are different, so long as both cases raise substantially the same issues.
- versus -
ASIA UNITED BANK,et al., Respondents. G.R. No. 195561
March 14, 2012 VILLARAMA, JR., J.: Background of the case A Third Party REM was executed by the petitioner over its 5,801-square meter property located at Pasong Tamo St., Makati City (Makati Property) covered by TCT No. 114645. The REM was signed by Gilbert G. Guy, President of Goodland Company, Inc., and were duly registered by AUB with the Registry of Deeds for Makati City. Subsequently, however, petitioner repudiated the REMs by claiming that AUB and its officers unlawfully filled up the blank mortgage forms and falsified the entries therein. Facts: Petitioner filed the first suit docketed as Civil Case No. 03-045 of the RTC of Makati City, alleging that Mr. Guy signed the blank REM deed with the understanding that the document shall not be completed and not to be registered with the Register of Deeds as it would only serve as comfort document to prove petitioners willingness to execute a REM in the future if so demanded by AUB. Petitioner thus prayed for the REM to be declared null and void, and accordingly cancelled.
Petitioner then filed the second case against herein respondents docketed as Civil Case No. 06-1032 of RTC of Makati City, Branch 145. Whereas the earlier case (Civil Case No. 03045) sought the annulment of the REM based on alleged irregularities in its execution, Civil Case No. 06-1032 prayed for injunctive relief and/or nullification of the extrajudicial foreclosure sale which petitioner alleged to be procedurally and legally defective as it is based on a null and void registration/annotation of a falsified Real Estate Mortgage.
Respondents then filed a motion to dismiss and contended that petitioner is guilty of forum shopping, as it has previously filed a case for the annulment of the REM (Civil Case No. 03-045) which is pending before Branch 56.
Issue: whether petitioner was guilty of forum shopping when it successively filed Civil Case No. 03-045 and Civil Case No. 06-1032. Ruling: petitioner was guilty of forum shopping because the identity of the causes of action in the two cases entails that the validity of the mortgage will be ruled upon in both, and creates a possibility that the two rulings will conflict with each other. This is precisely what is sought to be avoided by the rule against forum shopping. There is forum shopping when the following elements are present: (a) identity of parties, or at least such parties as represent the same interests in both actions[;] (b) identity of rights asserted and relief prayed for, the relief being founded on the same facts[;] and (c) the identity of the two preceding particulars[,] such that any judgment rendered in the other action will, regardless of which party is successful, amount to res judicata in the action under consideration. The cause of action in the earlier Annulment Case is the alleged nullity of the REM (due to its allegedly falsified or spurious nature) which is allegedly violative of Goodlands right to the mortgaged property. It serves as the basis for the prayer for the nullification of the REM. The Injunction Case involves the same cause of action, inasmuch as it also invokes the nullity of the REM as the basis for the prayer for the nullification of the extrajudicial foreclosure and for injunction against consolidation of title. While the main relief sought in the Annulment Case (nullification of the REM) is ostensibly different from the main relief sought in the Injunction Case (nullification of the extrajudicial foreclosure and injunction against consolidation of title), the cause of action which serves as the basis for the said reliefs remains the same the alleged nullity of the REM. Thus, what is involved here is the third way of committing forum shopping, i.e., filing multiple cases based on the same cause of action, but with different prayers. As previously held by the Court, there is still forum shopping even if the reliefs prayed for in the two cases are different, so long as both cases raise substantially the same issues.
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