Case Summary (G.R. No. 120135)
Trial Court Ruling
Petitioners moved to dismiss for lack of personality to sue and forum non conveniens. On December 3, 1993, RTC–Pasig denied the motion, ordering petitioners to answer the complaint.
Court of Appeals Ruling
Petitioners filed a Rule 45 certiorari petition against the denial of dismissal and its reconsideration. The CA treated it as a certiorari petition and dismissed it, finding no grave abuse of discretion and that petitioners had an adequate remedy on appeal.
Petitioners’ Arguments
- Separate corporate personality bars respondents (mere shareholders) from suing.
- Forum non conveniens warrants dismissal: key evidence, witnesses, transactions, vessel operations, and proceeds are abroad; English law governs; petitioners are not doing business in the Philippines.
- Foreign actions pending in England and Hong Kong invoke litis pendentia/res judicata; respondents are guilty of forum shopping.
Private Respondents’ Arguments
• Respondents’ alter-ego status and Filipino ownership justify their direct claims; Philippine-based real estate security omitted in petitioners’ account.
• RTC properly exercised discretion in applying forum non conveniens; petitioners had no right to certiorari and should have answered.
• Foreign judgments are not established; respondents did not participate in those proceedings.
Supreme Court’s Analysis
Cause of Action and Personality to Sue
• An order denying dismissal is interlocutory and not subject to certiorari unless there is excess jurisdiction, patent grave abuse, or no adequate remedy.
• The complaint pleads: (1) respondents’ right to an accounting; (2) petitioners’ fiduciary duty; (3) petitioners’ failure to account. These elements satisfy “cause of action.” Uncertainty in pleading favors a full merits inquiry.
Forum Non Conveniens
• The doctrine is discretionary and not a ground for dismissal under Rule 16. The Philippines i
Case Syllabus (G.R. No. 120135)
Procedural History
- Petition for review on certiorari under Rule 45 assails (a) the RTC order of December 3, 1993 denying defendants’ Motion to Dismiss and (b) the CA’s November 29, 1994 Decision dismissing petitioners’ certiorari petition and its April 28, 1995 resolution denying reconsideration.
- RTC Branch 162, Pasig City: Litonjuas v. Bank of America NT&SA and Bank of America International, Ltd., Civil Case No. 63181.
- CA: treated petitioners’ “Petition for Review on Certiorari” as a Rule 65 certiorari petition in CA‐G.R. SP No. 34382.
Facts
- Eduardo K. Litonjua, Sr. and Aurelio K. Litonjua, Jr. (Litonjuas) operate a shipping business owning Don Aurelio and El Champion through wholly‐owned corporations.
- Revenues and other funds deposited with Bank of America branches in the United Kingdom and Hong Kong until 1979.
- Banks induced Litonjuas to expand fleet by providing loans to their corporations, resulting in acquisition of four additional vessels:
- El Carrier (Panamanian flag; Espriona Shipping Co., S.A. as registered owner)
- El General (Liberian flag; Liberia Transport Navigation S.A.)
- El Challenger (Panamanian flag; El Challenger S.A.)
- El Conqueror (Panamanian flag; Eshley Compania Naviera S.A.)
- Petitioners assumed exclusive control of operations and funds; they placed vessels in possession of their designated agents.
- Litonjuas allege banks, as de facto trustees, failed to account for vessel revenues and foreclosure‐sale proceeds.
- Alleged breach of fiduciary duty and/or negligence led to revenue decline; matured, unpaid loans triggered foreclosure of all six vessels.
- Litonjuas lost amounts equal to 10 % of acquisition cost of four vessels and remained liable for outstanding loan balances.
- Prayer: full accounting of vessel revenues and sale proceeds; damages for breach of trust; exemplary damages; attorney’s fees.
Trial Court Proceedings
- Petitioners filed Motion to Dismiss for (a) forum non conveniens and (b) lack of cause of action.
- RTC denied Motion to Dismiss on December 3, 1993 and gave petitioners ten days to file an answer.
- Petitioners did not answer; instead filed a purported “Petition for Review on Certiorari” before the CA.
Appellate Rulings
- CA dismissed the certiorari pe