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97
98 SUPREME COURT REPORTS ANNOTATED
Global Business Holding, Inc. vs. Surecomp Sofware, B.V.
VOL. 633, OCTOBER 13, 2010 97
Global Business Holding, Inc. vs. Surecomp Sofware, B.V.
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On the first ground, Global argued that the contract ing claim, action or proceeding brought by or against
entered into was not an isolated transaction since the ASIANBANK may be prosecuted by or against the Merged
contract was for a period of 20 years. Furthermore, Global Bank. The right of creditors or liens upon the property of
stressed that it could not be held accountable for any ASIANBANK shall not be impaired by the merger; provided
breach as the agreement was entered into between that the Merged Bank shall have the right to exercise all
Surecomp and ABC. It had not, in any manner, taken part defenses, rights, privileges, set-offs and counter-claims of
in the negotiation and execution of the agreement but every kind and nature which ASIANBANK may have, or
merely took over the operations of ABC as a result of the with the Merged Bank may invoke under existing laws.”
merger. On the second ground, Global averred that the It appearing however that the second ground relied upon by
agreement, being a technology transfer arrangement, failed the defendant [Global], i.e., that the cause of action of the plaintiff
to comply with Sections 87 and 88 of the Intellectual is anchored on an unenforceable contract under the provision of
Property Code of the Philippines.8 the Intellectual Property Code, will require a hearing before the
In the interim, Global filed a motion for leave to serve motion to dismiss can be resolved and considering the established
written interrogatories to Surecomp in preparation for the jurisprudence in this jurisdiction, that availment of mode of
hearing on the motion to dismiss, attaching thereto its discovery by any of the parties to a litigation, shall be liberally
written interrogatories. construed to the end that the truth of the controversy on hand,
After an exchange of pleadings on the motions filed by shall be ascertained at a less expense with the concomitant
Global, on June 18, 2002, the RTC issued an Order,9 the facility and expeditiousness, the motion to serve written
pertinent portions of which read: interrogatories upon the plaintiff [Surecomp] filed by the
defendant [Global] is GRANTED insofar as the alleged
“After a thorough and careful deliberation of the respective unenforceability of the subject contract is concerned. Accordingly,
arguments advanced by the parties in support of their positions in the latter is directed to serve the written interrogatories upon the
these two (2) incidents, and since it cannot be denied that there is plaintiff [Surecomp], which is required to act on it in accordance
indeed a contract entered into between the plaintiff [Surecomp] with the pertinent rule on the matter.
and the defendant [Global], the latter as a successor in interest of Necessarily, the resolution of the motion to dismiss is held in
the merging corporation Asian Bank, defendant [Global] is abeyance until after a hearing on it is property conducted, relative
estopped from denying plaintiff’s [Surecomp’s] capacity to sue it to the second ground aforementioned.
for alleged breach of that contract with damages. Its argument SO ORDERED.”10
that it was not the one who actually contracted with the plaintiff
[Surecomp] as it was the merging Asian Bank which did, is of no Surecomp moved for partial reconsideration, praying for
moment as it does not relieve defendant Global Bank of its an outright denial of the motion to dismiss, while Global
contractual obligation under the Agreement on account of its filed a motion for reconsideration.11
undertaking under it: On November 27, 2002, the RTC issued an Order,12 the
“x x x shall be responsible for all the liabilities and fallo of which reads:
obligations of ASIANBANK in the same manner as if the
Merged Bank had itself incurred such liabilities or _______________
obligations, and any pend-
10 Id., at pp. 106-107.
_______________ 11 Id., at pp. 13, 108, 510.
12 Id., at pp. 108-110.
8 Id.
9 Penned by Pairing Judge Cesar D. Santamaria, Branch 146, Makati City; id., 100
at pp. 105-107.
October 2001 is denied on the two grounds therein alleged. abused its discretion and acted in excess of its
Defendant [Global] is given five (5) days from receipt of this Order jurisdiction.15
within which to file its Answer. On May 5, 2006, the CA rendered a Decision,16 the
The resolution of defendant’s [Global’s] Motion to Serve dispositive portion of which reads:
Written Interrogatories is held in abeyance pending the filing of
the Answer. “WHEREFORE, premises considered, the instant petition is
SO ORDERED.”13 DENIED. The assailed Orders dated June 18, 2002 and
November 27, 2002 of the Regional Trial Court of Makati City,
In partially modifying the first assailed Order, the RTC Branch 146, in Civil Case No. 01-1278 are hereby AFFIRMED.
ratiocinated, viz.: SO ORDERED.”17
“This court sees no reason to further belabor the issue on A motion for reconsideration was filed by Global. On
plaintiff’s capacity to sue since there is a prima facie showing that July 10, 2006, the CA issued a Resolution18 denying the
defendant entered into a contract with defendant and having done motion for reconsideration for lack of merit.
so, willingly, it cannot now be made to raise the issue of capacity Hence, this petition.
to sue [Merrill Lynch Futures, Inc. v. CA, 211 SCRA 824]. That Global presents the following issues for resolution: (1)
defendant was not aware of plaintiff’s lack of capacity to sue or whether a special civil action for certiorari is the proper
that defendant did not benefit from the transaction are remedy for a denial of a motion to dismiss; and (2) whether
arguments that are hardly supported by the evidence already Global is estopped from questioning Surecomp’s capacity to
presented for the resolution of the Motion to Dismiss. sue.19
As to the issue of unenforceability of the subject contract under The petition is bereft of merit.
the Intellectual Property Code, this court finds justification in I.
modifying the earlier Order allowing the further presentation of An order denying a motion to dismiss is an interlocutory
evidence. It appearing that the subject contract between the order which neither terminates nor finally disposes of a
parties is an executed, rather than an executory, contract the case as it leaves something to be done by the court before
statute of frauds therefore finds no application here. the case is finally decided on the merits. As such, the
x x x x general rule is that the denial of a motion to dismiss cannot
As to defendant’s Motion to Serve Written Interrogatories, this be questioned in
court finds that resort to such a discovery mechanism while
laudable is premature as defendant has yet to file its Answer. As _______________
the case now stands, the issues are not yet joined and the
disputed facts are not clear.”14 15 Id., at p. 15.
16 Supra note 1.
17 Id., at p. 17.
18 Supra note 2.
_______________ 19 Rollo, pp. 511-512.
abuse of discretion” is meant such capricious and A corporation has a legal status only within the state or
whimsical exercise of judgment that is equivalent to lack of territory in which it was organized. For this reason, a
jurisdiction. The abuse of discretion must be grave as corporation organized in another country has no
where the power is exercised in an arbitrary or despotic personality to file suits in the Philippines. In order to
manner by reason of passion or personal hostility, and subject a foreign corporation doing business in the country
must be so patent and gross as to amount to an evasion of to the jurisdiction of our courts, it must acquire a license
positive duty or to a virtual refusal to perform the duty from the Securities and Exchange Commission and appoint
enjoined by or to act all in contemplation of law.21 an agent for service of process. Without such license, it
In the instant case, Global did not properly substantiate cannot institute a suit in the Philippines.24
its claim of arbitrariness on the part of the trial court judge The exception to this rule is the doctrine of estoppel.
that issued the assailed orders denying the motion to Global is estopped from challenging Surecomp’s capacity to
dismiss. In a petition for certiorari, absent such showing of sue.
arbitrariness, capriciousness, or ill motive in the A foreign corporation doing business in the Philippines
disposition of the trial judge in the case, we are constrained without license may sue in Philippine courts a Filipino
to uphold the court’s ruling, especially because its decision citizen or a Philippine entity that had contracted with and
was upheld by the CA. benefited from it.25 A party is estopped from challenging
II the personality of a corporation after having acknowledged
The determination of a corporation’s capacity is a factual the same by entering into a contract with it.26 The principle
question that requires the elicitation of a preponderant set is applied to
of facts.22 As a rule, unlicensed foreign non-resident
corporations doing business in the Philippines cannot file _______________
suits in the Philippines.23 This is mandated under Section
133 of the Corporation Code, which reads: 24 European Resources and Technologies, Inc. v. Ingenieuburo
Birkhahn + Nolte, 479 Phil. 114, 124; 435 SCRA 246, 255 (2004), citing
Subic Bay Metropolitan Authority v. Universal International Group of
_______________
Taiwan, supra, at p. 704; p. 370-371; Georg Grotjahn GMBH & Co. v.
20 Rimbunan Hijau Group of Companies v. Oriental Wood Processing Isnani, G.R. No. 109272, August 10, 1994, 235 SCRA 216; Merrill Lynch
Corporation, 507 Phil. 631, 645; 470 SCRA 650, 661 (2005). Futures v. Court of Appeals, G.R. No. 97816, July 24, 1992, 211 SCRA 824;
21 Id. Antam Consolidated, Inc. v. Court of Appeals, 227 Phil. 267; 143 SCRA
22 Id., at p. 646. 288 (1986).
23 Subic Bay Metropolitan Authority v. Universal International Group 25 European Resources and Technologies, Inc. v. Ingenieuburo
of Taiwan, 394 Phil. 691, 703; 340 SCRA 359, 370 (2000). Birkhahn + Nolte, supra, at p. 125; p. 256.
26 Id.; Merrill Lynch Futures, Inc. v. Court of Appeals, supra note 24, at
103
p. 837.
104
VOL. 633, OCTOBER 13, 2010 103
Global Business Holding, Inc. vs. Surecomp Sofware, B.V.
104 SUPREME COURT REPORTS ANNOTATED
“Sec. 133. Doing business without a license.—No foreign Global Business Holding, Inc. vs. Surecomp Sofware, B.V.
corporation transacting business in the Philippines without a
license, or its successors or assigns, shall be permitted to prevent a person contracting with a foreign corporation
maintain or intervene in any action, suit or proceeding in any from later taking advantage of its noncompliance with the
court or administrative agency of the Philippines, but such statutes, chiefly in cases where such person has received
corporation may be sued or proceeded against before Philippine the benefits of the contract.27
courts or administrative tribunals on any valid cause of action Due to Global’s merger with ABC and because it is the
recognized under Philippine laws.” surviving corporation, it is as if it was the one which
entered into contract with Surecomp. In the merger of two
_______________
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