Case Digest (G.R. No. 207153)
Facts:
Development Bank of the Philippines v. Monsanto Company, G.R. No. 207153, January 25, 2023, First Division, Zalameda, J., writing for the Court.Petitioner is Development Bank of the Philippines (DBP); respondent is Monsanto Company (which substituted MISCO as plaintiff). The dispute arose from commercial sales of acrylic fibers by Monsanto International Sales Company (MISCO) to Continental Manufacturing Corporation (CMC) from 1978 to 1983, transacted through a local indentor, Robert Lipton and Co., Inc. (Lipton). The sales were documented by indent orders and paid by drafts against acceptance that CMC allegedly co-accepted with DBP. CMC defaulted on the unpaid balance, prompting MISCO to file suit on July 31, 1986 for collection of US$938,267.58.
CMC admitted the obligation but asserted MISCO lacked capacity to sue in the Philippines because it was a foreign corporation doing business without the required license under applicable law; it also pleaded novation as a defense asserting partial payments. DBP denied being a co-acceptor and challenged the authority of the person who signed the drafts; it likewise raised MISCO’s alleged lack of capacity to sue.
MISCO moved to amend and substitute plaintiff; with no opposition, the Regional Trial Court (RTC), Branch 165, Pasig City, allowed substitution and Monsanto (MISCO’s mother company and assignee) was substituted as plaintiff. The RTC, however, found MISCO to have transacted business in the Philippines without a license and, applying Section 133 of the Corporation Code, dismissed the complaint on August 15, 2006. On appeal, the Court of Appeals (CA) reversed and set aside the RTC decision in a September 26, 2012 Decision, remanding the case to the trial court to decide on the merits; the CA concluded that MISCO (and Monsanto as its assignee) was not “doing business” in the Philippines because the sales were effected through an independent indentor, and it applied estoppel against CMC’s capacity c...(Subscriber-Only)
Issues:
- Whether MISCO, or its assignee Monsanto, a foreign corporation without a license to do business in the Philippines, has the capacity to sue in Philippine courts.
- Whether the doctrine of estoppel bars CMC (and/or DBP) from challenging MISCO’s corporate capacity after contracting with and benefiting from MISCO.
- Whether Monsanto is the real party in interest entitled to prosecute the ...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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