VICTRONICS COMPUTERS vs RTC, BR63,

PANORAMA ENTERPRISES , Et. Al.

Subject: Obligations & Contracts

By:
DEXTER GARY P. FLORES
I Statement of the Legal Problem
The petitioner, Victronics Computers, Inc., was only paid 50% percent of the purchase
price of the computers and peripherals the company have delivered to the six different
branches of Victoria Court under the Victoria Court, GMT Consolidated Company and
Victoria Group of Companies. The petitioner then filed a complaint against the said
corporation on July 26, 1991 with the RTC of Makati for a sum of money and damages
for not paying the outstanding balance within and after the period stipulated in the
Purchase Order despite demands for its payment made on Velhagen and King which
was then the Genral Manager and Chief Executive Officer of the corporation. The case
was docketed as Civil Case No. 91-2069 and was raffled off to Branch 63 of the Makati
RTC.
On August 9, 1991, the six respondent corporations filed with the RTC of Makati a
complaint, dated 7 August 1991, for the nullification of the abovementioned Purchase
Order and for the damages done against the herein petitioner and one Teodorico B.
Kabigting, who is the manager of the Management Information Systems Division of the
said company. The case was docketed as Civil Case No. 91-2192 and was raffled to
Branch 150 of the said court.

II Legal Concepts relevant to the Case

LITIS PENDENTIA – the following are the grounds for Litis Pendentia to be invoked as
a ground for the abatement or dismissal of an action:
1. identity of parties, or at least such as representing the same interest in both
actions.
2. identity of the rights asserted and relief prayed for, the relief being found on
the same facts.
3. identity in the two cases should be such that the judgement that may be
rendered in the pending case would, regardless of which party is successful,
amount to res judicata in the other.
LITIS PENDENTIA – as a principle is a sanction of public policy against multiplicity of
suits.
- the plea of another action pending is sustained is that the latter
action is deemed unnecessary and vexatious.
Section 1(e) Rule 16 of the Rules Of the Court – states that the Rule do not require
as a ground for dismissal of a complaint that there is a prior pending action. They
provide that there is a pending action, not a pending prior action. The fact that the
unlawful detainer suit was of a latter date is no bar to the dismissal of the present
action.
Article 1582 of the Civil code– The vendee is bound to accept delivery and to pay the
price of the thing sold at the time and place stipulated in the contract. If the time and
place should not have been stipulated, the payment must be made at the time and
place of the delivery of the thing sold.
Article 1585 of the Civil Code – The buyer is deemed to have accepted the goods
when he intimates to the seller that he has accepted them, or when the goods have
been delivered to him, and he does any act in relation to them which is inconsistent
with the ownership of the seller, or when, after the lapse of a reasonable time, he
retains the goods without intimating to the seller that he has rejected them.
FORUM SHOPPING – A party should not be allowed to pursue simultaneous remedies
in two different forums for it does havoc to the rule on orderly procedure.

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III Highlights of the Case
Petitioner Victronics Computers, Inc., a domestic corporation engaged in the sale of
computer systems and peripherals, submitted a quotation for office systems to service
the networking requirements of various Victoria Court branches.
Satisfied with the said quotations, private respondents Velhagen and King placed an
order with the petitioner in a Purchase Order 1 form on which is written “GMT
CONSOLIDATED” above the printed word COMPANY, and the address 2129 Pasong
Tamo St., Makati, Metro Manila below it. The private respondents ordered six(6) sets of
80 DATA 386 computer system with peripherals for the net consideration, after
deducting a P7,000 discount, of P767,000.00 subject to the following conditions : a)
payment – 50% downpayment, 50% COD upon completion of the delivery. b) delivery –
within 30 calendar days upon receipt of P.O. and 50% downpayment. c) penalty – 1%
of total P.O. amount per day of delay.
Upon payment of the said 50% downpayment and the issuance of a P.O., the first three
of the computer systems was delivered on May 22, 1991. Delivery of the remaining
computer systems and peripherals was completed on June 20, 1991.
Only 50% of the purchase price of each of the sets delivered to the different
establishments was paid by the said corporations. The outstanding balance not having
been paid within and after the period stipulated in the Purchase Order despites
demand for its payment on Velhagen and King, the petitioner filed on July 26, 1991,
with the RTC of Makati a complaint for a sum of money and damages against: Karl c.
Velhagen and Archie R. King, who operate the business under the names Victoria
Court, GMT Consolidated Company and Victoria Group of Companies. The case was
docketed as Civil Case No. 91-2069 and was raffled to Branch 63 of the said court
which was then presided by herein respondent Judge Julio R. Logarta. Defendants
Velhagen and King were each served a summon and a copy of the complaint on
August 8, 1991.
On August 9, 1991 the six respondent corporations filed a complaint with the RTC of
Makati dated August 7, 1991 for the nullification of the abovementioned Purchase
Order and for damages against the herein petitioner and one Teodoro B. Kabigting on
the basis of fraud and undue influence and ordering the supplier of the said computers
jointly and severally liable. The case was docketed as Civil Case No. 91-2192 and was
raffled to Branch 150 of the Makati RTC.
On August 22 1991, respondent Velhagen and King filed a Motion to Dismiss and to
suspend the proceedings based on the following grounds: a) petitioner failed to verify
the complaint, b) plaintiff failed to sue the proper parties and c) there is a prejudicial
question or a pending incident before another court
On September 5, 1991, Velhagen and King filed in Civil Case No. 91-2192 a Special
Appearance and Motion to Dismiss asking the trial court to dismiss the case on the
grounds of improper service of summons and lack of jurisdiction over its defendant
therein.
On September 16,1991 Branch 63 of the Makati RTC issued an order dismissing Civil
Case No. 91-2069 because of Litis Pendentia.
On September 19, 1991, petitioner filed in Civil Case No. 91-2069, a contempt charge
against the respondents for forum-shopping claiming that after having received the
summons and a copy of the complaint, both respondent did not file an answer with
compulsory counterclaim but instead filed a separate action one day later.

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 Judge Zeus Abrogar ordered the reservice of summons on the petitioner on September
25, 1991.
On October 4, 1991 petitioner requested and obtained a copy of the said order of
dismissal of Civil Case No. 91-2069.
On October 9, 1991 the petitioner filed in Civil Case No. 91-2069 an Ex Abundante
Cautela Motion to Refer Forum Shopping Charge to Executive Judge. On the same
date, petitioner filed a Motion for Reconsideration of the said order of dismissal.
On October 14, 1991 after proper service of summons, petitioner filed a Motion to
Dismiss Civil Case No. 91-2192 on the grounds of litis pendentia and forum shopping.
On December 11, 1991 petitioner filed in Civil Case No. 91-2069 a motion for the
consolidation of the two cases before Branch 63 where the prior case was filed and on
January 6, 1992 it filed in the same case a Manifestation Pro Hac Vice wherein it states
that there was no pending action before Branch 150 as it had not yet acquired
jurisdiction over the person of the petitioner.
Petitioner filed in Civil Case No.91-2192 an answer with compulsory counterclaim on
January 20, 1992.
On 7 February 1992, the Clerk of Court Branch 63 sent the petitioner by registered mail
a copy of the 22 January 1992 Order in Civil Case No. 91-2069 which resolved the
various motions filed by the petitioner. The petitioner filed an instant petition as a
consequence of the January 22, 1992 order.
On June 10, 1992 the court resolved to give due course to the petition and required the
parties to submit their respective Memoranda, which they subsequently complied with.

IV Case Analysis and the Supreme Court Resolution

The court decided in favor of the petitioner, Victronics Computers Inc. based on Litis
Pendentia whereby Civil Case No. 91-2069 satisfies the requirements for the
abatement or dismissal of an action. The respondents did not proved to the court that
the second action was not brought to harass or vex the defendant and is not in fact
vexatious. The court also noted that the court does not require that the latter case
should yield to the earlier case, what is required is a pending action and not a pending
prior action. It is also noted that the second action, Civil Case No. 91-2192 was not
filed upon an inspiration of unadulterated good faith but to vex or harass in other
forum the petitioner in the first case. The court also decided in favor of the petitioner of
the first case because in the second case filed by the company, the lawyers forgot to
comply with the primary requirement of their case which is the Purchase Order which
was then not attached to their complaint. The court therefore granted the instant
petition of the plaintiff and therefore dismissing Civil Case No. 91-2192 on grounds of
lis pendens with cost against the defendants therein. The Order of respondent Court of
22 January 1992 I Civic Case No. 91-2069 is hereby modified by setting aside that
portion thereof denying the motion to reconsider its Order of Sept. 16, 1991 and
declaring that portion denying the motion for consolidation as moot and academic.

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V Critique of the Supreme Court Decision
I agree with the Court’s decision to make Civil Case No. 91-2069 the ground in
examining the case and deciding in favor of the petitioner because the respondents
failed to prove that the second case was initiated without an unadulterated good faith
and is not brought to harass the petitioner of the first case. The lawyers of the
defendant failed to convince the court that they acted based on good faith. It is proven
that the second action was self-serving and is done to vex the other party. Contracts
are binding and stipulations of the contract should be at all times be followed and with
the respondent company not fulfilling its obligation, the company should be held liable
for its damages to the vendor as stated in the Article 1582 of the Civil Code.

VI Conclusion and Recommendation

Rule does not require as a ground for dismissal of a complaint that there is a prior
action but only a pending action. Civil Case No. 91-2069 satisfies all the requisites of
litis pendentia and should therefore be given the favorable decision of the court. The
second case should be abated since it violates the rule of forum shopping that states
that a party should be allowed to pursue simultaneous remedies in two different forum.
It is also noted that the second action was self-serving and failed to prove to the court
that their action was in good faith and not meant to harass the petitioner of the first
case. The respondents should have offered to return the computers if they are really
not satisfied with the performance of the said computers and established to the court
that the computers delivered are outdated and obsolete. The respondents failed to
established this one to the court and in addition because of their haste to file the case
to the court, the defendants failed to attached the simple and basic requirement in filing
a case based on documents presented, and that is the purchase order in the case at
bar.