Facts:

The case at hand involves Antam Consolidated, Inc., Tambunting Trading Corporation, Aurora Consolidated Securities and Investment Corporation (collectively referred to as "petitioners"), and Stokely Van Camp, Inc. ("respondent"). The legal dispute began with Stokely filing a complaint on April 9, 1981, against Banahaw Milling Corporation, Antam, Tambunting, Aurora, and United Coconut Oil Mills, Inc. in the Court of First Instance of Laguna (now the Regional Trial Court) for the collection of sums of money. Stokely, incorporated under the laws of Indiana, U.S.A., alleged that it, together with its subdivision Capital City Products Company, was not licensed to conduct business in the Philippines and therefore was exempt from the requirement of obtaining such a license.

Stokely's complaint detailed a series of transactions with Coconut Oil Manufacturing (Phil.) Inc. (Comphil) concerning the sale and subsequent failed delivery of crude coconut oil. The initia

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Facts:

Background of the Parties

• Petitioners: ANTAM Consolidated, Inc., Tambunting Trading Corporation, and Aurora Consolidated Securities and Investment Corporation.
• Respondents: The Court of Appeals, the trial court (Court of First Instance of Laguna, Branch II – Sta. Cruz), and Stokely Van Camp, Inc.

Dispute and Underlying Transaction

• On April 9, 1981, respondent Stokely Van Camp, Inc. filed a complaint against multiple parties, including petitioners, for the collection of money.
• The complaint centered on the non-delivery of 500 long tons of crude coconut oil under a contractual arrangement that resulted in a loss of US$103,600 for Capital City Product Company—a subdivision linked to the respondent.
• The loss from the first contract prompted parties to enter subsequent contracts intended to “wash out” or cover the deficit.

The Series of Transactions

• First Contract:
• Capital City (a subdivision of the respondent) and Coconut Oil Manufacturing (Phil.) Inc. (Comphil) entered an agreement to sell and deliver 500 long tons of crude coconut oil at a CIF price of US$0.30 per pound in October/November 1978.
• Failure of Comphil to deliver resulted in Capital City incurring a loss of US$103,600.
• Second Contract (No. RBS 3738, November 3, 1978):
• Intended as a wash-out against the first contract, with Comphil undertaking to repurchase the undelivered oil at an increased price (US$0.3925 per pound) to cover the loss.
• Again, Comphil did not meet its contractual obligation by failing to make the required payment.
• Third Contract (January 24, 1979):
• Entered to settle the outstanding loss by having petitioners deliver 500 long tons of coconut oil at a discounted CIF price of US$0.3425 per pound, with the total discount equating to US$103,600.
• Non-delivery under this contract led respondent to initiate the lawsuit.

Court Proceedings and Motions

• Trial Court Proceedings:
• Respondent sought a writ of attachment against the petitioners’ properties to secure judgment, depositing a bond of P1,285,000.00.
• On August 10, 1981, the trial court reduced the attachment bond to P500,000.00.
• Petitioners filed a motion to dismiss the complaint on the ground that the respondent, as a foreign corporation allegedly not licensed to do business in the Philippines, lacked capacity to sue.
• Appellate and Subsequent Proceedings:
• The Intermediate Appellate Court, on June 14, 1982, dismissed the petition for certiorari by ruling that the respondent judge had not committed grave abuse of discretion in deferring the resolution of the dismissal motion.
• Petitioners further filed a motion for reconsideration, which was denied.
• Verification Issue in Attachment Order:
• Petitioners contended that the verification supporting the writ of attachment was defective since it was based on an affidavit stating that claims in the complaint were “read” and accepted on an information and belief basis.
• The defect was remedied when the assistant attorney, Renato Calma, subsequently executed an affidavit verifying the allegations based on records from Comphil and the Securities and Exchange Commission.

Allegations and Arguments

• Petitioners’ Claims:
• Argued that the respondent, by its own facts, was effectively “doing business” in the Philippines due to its involvement in a series of transactions.
• Maintained that as a foreign corporation engaged in ongoing commercial dealings, the respondent should have secured the necessary local license; failure to do so should bar it from initiating a suit.
• Respondent’s Position:
• Asserted that the transactions were isolated incidents solely aimed at recovering the loss from the initial contract, and did not constitute a continuity of business.
• Contended that such isolated, non-continuous transactions do not amount to “doing business” in the Philippines and thus do not require a local license for capacity to sue.

Issue:

• Whether the respondent’s isolated transactions to recover a contractual loss should be considered as “doing business” in the Philippines, thereby necessitating the possession of a local license to sue.
• Whether the failure to secure a local license automatically deprives a foreign corporation of its capacity to institute a suit before Philippine courts.
• Whether the verification provided in support of the writ of attachment was sufficient and legally acceptable, despite its initial defect being corrected by a subsequent affidavit.
• Whether the trial and appellate courts erred in denying the petitioners’ motions (both the motion to dismiss and the motion to set aside the attachment order).

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)