Case Summary (G.R. No. 162894)
Key Dates
- 1990: BMSI engages respondent under a verbal agreement to secure Philippine government projects for 10% commission.
- March 11, 1992: Respondent procures a dredging contract for BMSI with the Philippine government.
- July 16, 1994: Respondent files labor suit before NLRC against BMSI, RUST, and individuals.
- September 28, 1995: Labor Arbiter orders BMSI and RUST to pay money claims.
- 1997–1998: NLRC reverses arbiter; Supreme Court Resolution dismisses respondent’s appeal (final November 9, 1998).
- January 8, 1999: Respondent files Civil Case No. 1192-BG for damages in RTC Bauang, La Union.
- September 13, 2000 & July 31, 2001: RTC denies petitioner’s omnibus motion and reconsideration.
- August 28, 2003 & March 10, 2004: Court of Appeals (CA) denies certiorari petition and reconsideration.
- February 26, 2008: Supreme Court decision affirming CA.
Applicable Law
- 1987 Philippine Constitution (case decided 2008).
- Rule 45, Rules of Civil Procedure (petition for certiorari).
- Doctrine of forum non conveniens and conflict-of-laws principles in Philippine jurisprudence (e.g., Hasegawa v. Kitamura).
Factual Background
Respondent was orally engaged by BMSI in 1990 to secure government service contracts in the Philippines for a 10% commission. He obtained a dredging contract in 1992. In 1994, he filed a labor case before the NLRC against BMSI, RUST, and their officers for non-payment of commissions and wrongful termination. The Labor Arbiter ruled in his favor, but the NLRC reversed for lack of jurisdiction. The Supreme Court dismissed his ensuing appeal in 1997, final in 1998.
Civil Case Before the RTC
On January 8, 1999, respondent sued BMSI, RUST, and Raytheon International in the RTC, alleging unpaid commissions and that the three corporations had “combined and functioned as one,” rendering petitioner jointly liable. Raytheon denied any contractual relationship, invoked the written choice-of-law clause applying Connecticut law, and moved to dismiss for failure to state a cause of action and on forum non conveniens grounds. The RTC denied both the omnibus motion and its reconsideration, holding that the complaint’s factual allegations were sufficient and that forum non conveniens did not apply since petitioner was licensed in the Philippines.
Proceedings on Certiorari
Petitioner filed a Rule 65 petition in the CA seeking to annul the RTC orders. The CA denied relief on August 28, 2003, and denied reconsideration on March 10, 2004, finding no grave abuse of discretion:
- Evidence aliunde was insufficient to conclude the complaint failed to state a cause of action;
- The factual issue of corporate combination required full trial;
- RTC properly exercised discretion in declining to dismiss on forum non conveniens grounds.
Issues on Review
- Whether the CA erred in refusing to dismiss the complaint for failure to state a cause of action against Raytheon International, Inc.
- Whether the CA erred in refusing to dismiss the complaint on the ground of forum non conveniens.
Supreme Court Ruling on Jurisdiction and Forum Non Conveniens
- Jurisdiction and choice of law are distinct. The written Connecticut-law clause affects substantive issues at trial, not RTC’s jurisdiction.
- Philippine courts may exercise jurisdiction over foreign-element cases if: (1) forum is convenient; (2) court can make intelligent decisions on facts and law; (3) court can enforce judgment.
- Raytheon’s licensing in the Philippines satisfies en
Case Syllabus (G.R. No. 162894)
Antecedents and Contractual Engagement
- In 1990, Brand Marine Services, Inc. (BMSI), a Connecticut corporation, entered into a Special Sales Representative Agreement with Stockton W. Rouzie, Jr., an American citizen.
- Under the agreement, Rouzie was to negotiate the sale of services for Philippine government projects in exchange for 10% of gross receipts.
- On March 11, 1992, Rouzie secured a dredging contract for rivers affected by the Mt. Pinatubo eruption on behalf of BMSI.
Labor Arbitration Proceedings
- On July 16, 1994, Rouzie filed a complaint before the National Labor Relations Commission’s Arbitration Branch against BMSI, Rust International, Inc. (RUST), and two individuals for unpaid commissions, illegal termination, and breach of contract.
- On September 28, 1995, Labor Arbiter Pablo C. Espiritu, Jr. ruled in favor of Rouzie and ordered BMSI and RUST to pay money claims.
- The NLRC reversed the arbiter’s decision on appeal, dismissing the complaint for lack of jurisdiction.
- Rouzie’s petition for review to the Supreme Court was dismissed on November 26, 1997, with finality on November 9, 1998.
Civil Case Before the Regional Trial Court
- On January 8, 1999, Rouzie filed Civil Case No. 1192-BG for damages in the RTC of Bauang, La Union, naming Raytheon International, Inc., BMSI, and RUST as defendants.
- The complaint reiterated the labor‐case allegations and added that the three corporations had functioned as one entity.
- Raytheon filed its Answer denying any agreement or payment to Rouzie, denied any corporate combination, and invoked the Connecticut choice‐of‐law clause in the Special Sales Representative Agreement.
- Raytheon moved to dismiss for failure to state a cause of action and on the ground of forum non conveniens, and prayed for damages by compulsory counterclaim.
Omnibus Motion and Trial Court Rulings
- On May 18, 1999, Raytheon filed an Omnibus Motion for Preliminary Hearing Based on Affirmative Defenses and for Summary Judgment.
- A depos