Facts:
Unimasters Conglomeration, Inc. and
Kubota Agri-Machinery Philippines, Inc. entered into a
Dealership Agreement for Sales and Services on October 28, 1988, which contained a venue clause stating that “
All suits arising out of this Agreement shall be filed with/in the proper Courts of Quezon City” and required
Unimasters to secure a P2,000,000 credit line with
Metropolitan Bank and Trust Company‑Tacloban Branch. On December 24, 1993,
Unimasters filed Civil Case No. 93‑12‑241 in the
Regional Trial Court of Tacloban City, Branch 6, against
Kubota, Reynaldo Go, and
Metrobank, seeking damages for breach of contract and injunctive relief; the RTC issued a temporary restraining order the same day restraining
Metrobank from effecting payments or charging
Unimasters in connection with the credit line.
Kubota filed a motion to dismiss for improper venue and a motion to transfer the injunction hearing on January 4, 1994; the injunction hearing proceeded on January 10–11, 1994, with
Kubota’s counsel participating while expressly reserving the venue objection, and on January 13, 1994 the RTC authorized issuance of a preliminary injunction upon bond of P2,000,000.00; on February 3, 1994 the RTC denied
Kubota’s motion to dismiss, ruling that filing in Tacloban was proper.
Kubota sought relief by special civil action in the
Court of Appeals (CA‑G.R. SP No. 33234), which held that the contractual venue clause limited venue exclusively to Quezon City and that
Kubota had not waived its objection; the Court of Appeals denied reconsideration, and
Unimasters appealed to the
Supreme Court.
Issues:
Whether the stipulation in the Dealership Agreement that “
All suits arising out of this Agreement shall be filed with/in the proper Courts of Quezon City” operates to limit venue exclusively to Quezon City. Whether
Kubota’s participation in the injunction hearing and cross‑examination of witnesses constituted a waiver of its objection to venue. Whether venue improperly laid in the Tacloban RTC deprived that court of jurisdiction to entertain the action.
Ruling:
Ratio:
Doctrine: