VOL.

518, MARCH 12, 2007 123

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.

*
G.R. Nos. 159669 & 163521. March 12, 2007.

UNITED OVERSEAS BANK PHILS. (formerly

WESTMONT BANK), petitioner, vs. ROSEMOORE
MINING & DEVELOPMENT CORP. and DRA. LOURDES
PASCUAL, respondents.

Actions; Pleadings and Practice; Forum Shopping; Elements;

The essence of forum shopping is the filing of multiple suits
involving the same parties for the same cause of action, either
simultaneously or successively, for the purpose of obtaining a
favorable judgment.·The essence of forum shopping is the filing of
multiple suits involv-

_______________

* SECOND DIVISION.

124

124 SUPREME COURT REPORTS ANNOTATED

United Overseas Bank Phils. vs. Rosemoore Mining & Development

Corp.

ing the same parties for the same cause of action, either
simultaneously or successively, for the purpose of obtaining a
favorable judgment. The elements of forum shopping are: (a)
identity of parties, or at least such parties as represent the same
interests in both actions; (b) identity of rights asserted and reliefs
prayed for, the reliefs being founded on the same facts; and (c) the
identity with respect to the two preceding particulars in the two
cases is such that any judgment rendered in the pending cases,
regardless of which party is successful, amount to res judicata in
the other case.

Same; Same; Venue; The venue of real actions affecting

properties found in different provinces is determined by the
singularity or plurality of the transactions involving said parcels of
land.·The rule on venue of real actions is provided in Section 1,
Rule 4 of the 1997 Rules of Civil Procedure, which reads in part:
Section1. Venue of Real Actions.·Actions affecting title to or
possession of real property, or interest therein, shall be commenced
and tried in the proper court which has jurisdiction over the area
wherein the real property involved, or a portion thereof, is situated.
x x x The venue of the action for the nullification of the foreclosure
sale is properly laid with the Malolos RTC although two of the
properties together with the Bulacan properties are situated in
Nueva Ecija. Following the above-quoted provision of the Rules of
Court, the venue of real actions affecting properties found in
different provinces is determined by the singularity or plurality of
the transactions involving said parcels of land. Where said parcels
are the object of one and the same transaction, the venue is in the
court of any of the provinces wherein a parcel of land is situated.

Same; Same; Legal Ethics; Attorneys; A lawyer shall not do any

falsehood, nor consent to the doing of any in court; nor shall he
mislead, or allow the Court to be misled by any artifice.·This
apparent deliberate misrepresentation cannot simply pass without
action. The real estate mortgage form supplied to Rosemoor is the
BankÊs standard pre-printed form. Yet the Bank perpetrated the
misrepresentation. Blame must be placed on its doorstep. But as
the BankÊs pleading was obviously prepared by its counsel, the
latter should also share the blame. A lawyer shall not do any
falsehood, nor consent to the doing of any in court; nor shall he
mislead, or allow the Court to be misled by any artifice. Both the
BankÊs president and counsel should be made to explain why they
should not be sanctioned for contempt of court.

125

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United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.
PETITIONS for review on certiorari of the decisions of the
Court of Appeals.

The facts are stated in the opinion of the Court.

Siguion Reyna, Montecillo and Ongsiako Law Offices
for petitioner.
Eufemio Law Offices for private respondents.

TINGA, J.:

We resolve these two consolidated cases, which though with

distinct courts of origin, pertain to issues stemming from
the same loan transaction.
The antecedent facts follow.
Respondent Rosemoor Mining and Development
Corporation (Rosemoor), a Philippine mining corporation
with offices at Quezon City,1 applied for and was granted by
petitioner Westmont Bank (Bank) a credit facility in the
total amount of P80 million consisting of P50,000,000.00 as2
long term loan and P30,000,000.00 as revolving credit line.
To secure the credit facility, a lone real estate mortgage
agreement was executed by Rosemoor and Dr. Lourdes
Pascual (Dr. Pascual), RosemoorÊs president, as mortgagors3
in favor of the Bank as mortgagee in the City of Manila.
The agreement, however, covered 4
six (6) parcels of land
located in San Miguel, Bulacan (Bulacan 5properties), all
registered under6
the name of Rosemoor, and two (2)
parcels of land

_______________

1 Now United Overseas Bank Philippines.

2 Rollo, (G.R. No. 159669), p. 73.
3 Id., at pp. 159-161; Real Estate Mortgage.
4 Covered by Transfer Certificate of Title Nos. 42132, 42133, 42134,
42135, 42136 and 34569.
5 Rollo, (G.R. No. 159669), p. 73
6 Covered by Transfer Certificate of Title Nos. NT-12627 and NT-
12628.

126

126 SUPREME COURT REPORTS ANNOTATED

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.
situated in Gapan, Nueva Ecija (Nueva Ecija properties),7
owned and registered under the name of Dr. Pascual.
Rosemoor subsequently opened with the Bank four (4)
irrevocable Letters
8
of Credit (LCs) totaling
US$1,943,508.11. To cover payments by the Bank under
the LCs, Rosemoor proceeded to draw against its credit
facility and thereafter executed promissory 9
notes
amounting collectively to P49,862,682.50. Two (2) other
promissory notes were also executed by Rosemoor in the
amounts of P10,000,000.00 and P3,500,000.00, 10
respectively,
to be drawn from its revolving credit line.
Rosemoor defaulted in the payment of its various
drawings under the LCs and promissory notes. In view of
the default, the Bank caused the extrajudicial foreclosure
of the Nueva Ecija properties on 22 May 1998 and the
Bulacan properties on 10 August11 1998. The Bank was the
highest bidder on both occasions.
On 8 October 1999, the Bank caused the annotation of
the Notarial Certificate of Sale covering the Nueva Ecija
properties on the certificates of title concerned. Later, on 16
March 2001, the Notarial Certificate of Sale covering the
Bulacan properties was 12
annotated on the certificates of
title of said properties.
The foregoing facts led to RosemoorÊs filing of separate
complaints against the Bank, one before the Regional Trial
Court of Manila (Manila RTC) and the other before the
Regional Trial Court of Malolos, Bulacan (Malolos RTC).

_______________

7 Rollo, (G.R. No. 163521), p. 14.

8 Id., at p. 15 and 271.
9 Id., at pp. 15 and 273.
10 Id.
11 Rollo, (G.R. No. 159669), p. 73.
12 Rollo, (G.R. No. 163521), p. 15.

127

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United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.
The Manila Case (G.R. No. 163521)

On 5 August 1998, Rosemoor and Dr. Pascual filed a

Complaint, originally captioned as one for „Damages,
Accounting and Release of Balance of Loan 13and Machinery
and for Injunction‰ before the Manila RTC. Impleaded as
defendants were the Bank and Notary Public Jose
Sineneng, 14 whose office was used to foreclose the
mortgage. The complaint was twice amended, the caption
eventually reflecting an action
15
for „Accounting, Specific
Performance and Damages.‰ Through the amendments,
Pascual was dropped as a plaintiff while
16
several officers of
the Bank were included as defendants.
The Bank moved for the dismissal of the original and
amended complaints 17on the ground that the venue had
been improperly laid. The motion was denied by the trial
court 18through an Omnibus Resolution dated 24 January
2000.
RosemoorÊs prayer in the Second Amended Complaint,
which was filed in November of 1999, reads as follows:

„WHEREFORE, plaintiff Rosemoor Mining & Development

Corporation respectfully prays that, after trial of the issues, this
court promulgate judgment·

1. Directing Westmont to render an accounting of the loan

account of Rosemoor under the Long Term Loan Facility
and the Revolving Credit Line at least up to the dates of
foreclosure of RosemoorÊs mortgaged properties on May 22,
1998 and August 18, 1998,

_______________

13 Id., at pp. 221-235.

14 Id., at p. 62.
15 Id., at pp. 266-286.
16 Impleaded as defendants in the Second Amended Complaint were
Florido Casuela, Avelina Dela Cruz, Proserfina Cruz, and Rolando
Castro. Casuela was included as a former Vice President of the Bank
while Dela Cruz, Cruz, and Castro were impleaded as incumbent Vice
President, Manager, and Senior Officer, respectively, of the Bank. See
Rollo, (G.R. No. 163521), pp. 267-268.
17 Id., at pp. 237-242; Urgent Motion to Dismiss.
18 Id., at pp. 327-328.
 128

128 SUPREME COURT REPORTS ANNOTATED

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.

showing among others (a) the sums of money paid by

Rosemoor or otherwise debited from its deposit account in
payment of the loans it had obtained from Westmont to
cover the cost of the machinery to be imported under the
Unpaid LCs and under LC No. 97-058 for the tiling plant, as
well as for working capital, and (b) all interests, penalties
and charges imposed on the loans pertaining to the Unpaid
LCs and LC No. 97-058 and for which Westmont had
foreclosed RosemoorÊs and Dra. PascualÊs real estate
mortgage; (c) the amount of import and customs duties,
demurrage, storage and other fees which Rosemoor had paid
or which was otherwise debited from RosemoorÊs deposit
account, in connection with the importation of the tiling
plant and as a consequence of the non-release thereof by
Westmont;
2. Ordering all the defendants jointly and severally to pay to
Rosemoor, by way of actual damages, the dollar equivalent
of the amounts in (1) (a), (b) and (c) at the exchange rate
prevailing at the time of the opening of the LCs;
3. Ordering defendants jointly and severally to pay to Rose-
moor actual damages for operational losses suffered by
Rosemoor due to its failure to use the tiling plaint which
Westmont had refused to release to Rosemoor, in such
amount as may be proven at the trial;
4. Directing the defendants jointly and severally to pay, by
way of correction for the public good, exemplary damages in
the amount of P 500,000.00 each;
5. Ordering defendants jointly and severally to indemnify
Rosemoor in the sum of P350,000.00, representing
attorneyÊs fees and litigation expenses incurred by
Rosemoor for the protection and enforcement of its rights
and interests.

Plaintiff prays for further and other relief as may be just and
19
equitable under the circumstances.‰

On 15 August 2002, the Bank filed another motion to

dismiss the Second Amended Complaint on the ground of
forum shopping since, according to it, Rosemoor had filed
another petition
20
earlier on 11 March 2002 before the
Malolos RTC.

_______________

19 Id., at pp. 283-284.

20 Id., at p. 63; CA Decision.

129

VOL. 518, MARCH 12, 2007 129

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.

The Bank contended that as between the action before the

Manila RTC and the petition before the Malolos RTC, there
is identity of parties, rights asserted, and reliefs prayed for,
the relief being founded on the same set of facts. The Bank
further claimed that any judgment that may be rendered in 21
either case will amount to res judicata in the other 22
case.
Still, the Manila RTC denied the motion to dismiss. It also
denied 23the BankÊs motion for reconsideration of the order of
denial.
The Bank challenged the Manila RTCÊs denial of the
BankÊs second motion to dismiss before the Court of
Appeals, through a petition for certiorari. The appellate
court dismissed 24the petition in a Decision dated 26
February 2004. The Bank filed a motion for
reconsideration which, however, 25
was denied through a
Resolution dated 30 April 2004.

_______________

21 Id., at p. 65.
22 Id., at p. 404. See also p. 65.
The pertinent portion of the Order reads:

There is no forum shopping.

There is forum shopping when in two or more cases pending there is identity
of (a) parties, (b) rights or causes of action and (c) relief sought, (Buan v. Lopez,
145 SCRA 34). These requisites are not present in the Bulacan case, the action
is for Injunction with damages, while the case before this Court is for
Accounting, Specific Performance and Damages. Thus, the case of Denville
Maritime, Inc. v. Commission on Audit, 175 SCRA 701 cited[,] by the
defendants does not apply.
WHEREFORE, the Motion to Dismiss is DENIED for lack of merit.
SO ORDERED.

23 Id., at p. 65.
24 Id., at pp. 61-68, Decision of the Court of Appeals is dated 26
February 2004, penned by Associate Justice Rodrigo V. Cosico with the
concurrence of Associate Justices Mariano C. Del Castillo and Vicente Q.
Roxas.
25 Id., at pp. 70-71.

130

130 SUPREME COURT REPORTS ANNOTATED

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.

In the Petition for Review on Certiorari in G.R. No. 163521,

the Bank argues that the Court of Appeals erred in holding
that no forum
26
shopping attended the actions brought by
Rosemoor.

The Malolos Case (G.R. No. 159669)

After the complaint with the Manila RTC had been lodged,
on 11 March 2002, Rosemoor and Dr. Pascual filed another
action against the Bank, this time before the Malolos RTC.
Impleaded together with the Bank as respondent was the
Register of Deeds for the Province of Bulacan in the
Petition for Injunction with Damages, with Urgent Prayer
for Temporary
27
Restraining Order and/or Preliminary
Injunction.
In the Malolos case, Rosemoor and Dr. Pascual alleged
that the redemption period for the Bulacan properties
would expire on 16 March 2002. They claimed that the
threatened consolidation of titles by the Bank is illegal,
stressing that the foreclosure of the real estate
28
mortgage by
the Bank was fraudulent and without basis, as the Bank
had made them sign two blank forms of Real Estate
Mortgage and several promissory notes also in blank forms.
It appeared later, according to Rosemoor and Dr. Pascual,
that the two Real Estate Mortgage blank forms were made
as security for two loans, one for P80 million and the other
for P48 million, when the total approved loan was only for
P80 million. The Bank later released only the amount of
P10 million out of the P30 million revolving
29
credit line, to
the prejudice of Rosemoor, they added.
The PetitionÊs prayer reads as follows:

_______________

26 Id., at p. 29.
27 Rollo, (G.R. No. 159669), pp. 230-238.
28 Id., at p. 74.
29 Id.

131

VOL. 518, MARCH 12, 2007 131

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.

„WHEREFORE, premises considered, it is most respectfully prayed

that this Honorable Court·

1. Issue ex parte a temporary restraining order before the

matter could be heard on notice to restrain and enjoin
respondent BANK from proceeding with its threatened
consolidation of its titles over the subject properties of
petitioner Rosemoor in San Miguel, Bulacan covered by TCT
Nos. 42132; 42133; 42134; 42135; 42136 and RT 34569 (T-
222448) on March 16, 2002 or at any time thereafter; that
the respondent Register of Deeds for the Province of
Bulacan be enjoined and restrained from registering any
document(s) submitted and/or to be submitted by
respondent BANK consolidating its titles over the above-
named properties of petitioner Rosemoor in San Miguel,
Bulacan; and likewise, that the Register of Deeds for the
province of Bulacan be restrained and enjoined from
canceling the titles of Rosemoor over its properties, namely,
TCT Nos. 42132; 42133; 42134; 42135; 42136 and RT 34569
(T-222448);
2. That after due notice, a writ of preliminary injunction be
issued upon the posting of a bond in such amount as may be
fixed by this Court;
3. That after due hearing and trial, judgment be rendered in
favor of petitioners and against respondent BANK·

a. Permanently enjoining respondent BANK from proceeding

with the consolidation of its titles to the subject properties
 of Rosemoor covered by TCT Nos. 42132; 42133; 42134;
42135; 42136 and RT 34569 (T-222448); and permanently
restraining respondent Register of Deeds for the Province of
Bulacan from registering any document(s) submitted and/or
to be submitted by respondent BANK consolidating its titles
over the above-named properties of petitioner Rosemoor in
San Miguel, Bulacan; and likewise, that the Register of
Deeds for the province of Bulacan be restrained and
enjoined from cancelling the titles of Rosemoor over its
properties, namely, TCT Nos. 42132; 42133; 42134; 42135;
42136 and RT 34569 (T-222448);
b. Declaring the foreclosures of Real Estate Mortgages on the
properties of petitioners Rosemoor and Dra. Pascual to be
null and void;
c. Recognizing the ownership in fee simple of the petitioners
over their properties above-mentioned;

132

132 SUPREME COURT REPORTS ANNOTATED

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.

d. Awarding to petitioners the damages prayed for, including

attorneyÊs fees and costs and expenses of litigation.

Petitioners pray for such other reliefs and remedies as may be

30
deemed just and equitable in the premises.‰

As it did before the Manila RTC, the Bank filed a motion to

dismiss on 26 March 2002 on the ground that Rosemoor
had engaged31in forum shopping, adverting to the pending
Manila case. The Bank further alleged that Dr. Pascual
has no cause of action since the properties registered in her
name are located in Nueva Ecija. The Malolos RTC denied 32
the motion to dismiss in an Order dated 13 May 2002. In
the same Order, the Malolos RTC directed the Bank to file 33
its answer to the petition within five (5) days from notice.
Despite receipt of the Order on 21 May 2002, the Bank
opted not to file its answer as it filed
34
instead a motion for
reconsideration on 5 June 2002. Meanwhile, Rosemoor
and Dr. Pascual moved to declare the35Bank in default for
its failure to timely file its answer. On 10 September
2002, the Malolos RTC issued an order denying the BankÊs
motion for reconsideration for lack of merit and at the same
time declaring
36
the Bank in default for failure to file its
answer.
Hence, the Bank filed a second petition for certiorari
before the Court of Appeals, where it assailed the Orders
dated 13 May 2002 and 10 September 2002 of the Malolos
RTC. During the pendency of this petition for certiorari,
the Malolos RTC decided
37
the Malolos case on the merits in
favor of Rosemoor.

_______________

30 Id., at pp. 236-237.

31 Id., at p. 363.
32 Id., at p. 75.
33 Id.
34 Id.; id., at p. 363.
35 Id.
36 Id.
37 Id., at p. 367; dispositive part of which reads:

133

VOL. 518, MARCH 12, 2007 133

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.

The decision in the38Malolos case was also appealed to the

Court of Appeals. Based on these developments, the
appellate court considered the prayer for preliminary
injunction as moot and academic and proceeded with the
resolution of the petition, by then docketed as CA-G.R. SP
No.73358, on the merits. The appellate court 39dismissed the
petition in a Decision dated 20 June 2003. Undaunted,
the Bank filed the petition in G.R. No. 159669 before this
Court.
The two petitions before this Court have been
consolidated. We find one common issue in G.R. No. 159669
and G.R. No. 163521·whether Rosemoor committed
forum-shopping in

_______________

WHEREFORE, premises considered, judgment is hereby rendered in favor of

petitioners and against respondents, to wit:
 1. The Writ of Preliminary Injunction issued by this Court on 25 March
2002 is hereby made permanent;
2. Declaring as null and void the Real Estate Mortgage executed by
petitioner corporation in favor of respondent Bank (Exhibits „D‰ and
„E‰) and the subsequent foreclosures of such mortgages;
3. Ordering the respondent United Overseas Bank Philippines to pay unto
petitioners as follows:

• P2,000,000.00 as moral and exemplary damages unto Dra. Lourdes Pascual

(P1,000,000.00 as moral damages; P1,000,000.00 as exemplary damages);
• P13,000,000.00 unto petitioner Rosemoor Mining and Development
Corporation as moral and exemplary damages (P3,000,000.00 as moral
damages and P10,000,000.00 as exemplary damages); and
• P100,000.00 unto petitioner as attorneyÊs fees, plus cost of litigation.

SO ORDERED.‰

38 Id., at p. 75 citing CA Rollo, pp. 463-466.

39 Id., at pp. 72-79; Penned by Associate Justice Romeo A. Brawner
with the concurrence of Associate Justices Eliezer R. Delos Santos and
Regalado E. Maambong.

134

134 SUPREME COURT REPORTS ANNOTATED

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.

filing the two cases against the Bank. The other issues for
resolution were raised in G.R. No. 159669, pertaining as
they do to the orders issued by the Malolos RTC. These
issues are whether the action to invalidate the foreclosure
sale was properly laid with the Malolos RTC even as
regards the Nueva Ecija properties; whether it was proper
for the Malolos RTC to declare the Bank in default; and
whether it was proper for the Malolos RTC to deny40 the
BankÊs motion to dismiss through a minute resolution.

Forum-Shopping

The central issue in these consolidated cases is whether

Rosemoor committed forum-shopping in filing the Malolos
case during the pendency of the Manila case.
The essence of forum-shopping is the filing of multiple
suits involving the same parties for the same cause of
action, either simultaneously or successively,
41
for the
purpose of obtaining a favorable judgment. The elements
of forum-shopping are: (a) identity of parties, or at least
such parties as represent the same interests in both
actions; (b) identity of rights asserted and reliefs prayed
for, the reliefs being founded on the same facts; and (c) the
identity with respect to the two preceding particulars in
the two cases is such that any judgment rendered in the
pending cases, regardless of which party 42
is successful,
amount to res judicata in the other case.
As to the existence of identity of parties, several bank
officers and employees impleaded in the Amended
Complaint in the Manila case were not included in the
Malolos case. These bank officers and employees were sued
in Manila in their personal capacity. A finding of negligence
or bad faith in their

_______________

40 Rollo, (G.R. No. 163521), p. 584.

41 Mondragon Leisure and Resorts Corporation v. United Coconut
Planters Bank, G.R. No. 154187, 14 April 2004, 427 SCRA 585.
42 Id. See also Valencia v. Court of Appeals, 331 Phil. 590, 603; 263
SCRA 275, 284-285 (1996).

135

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United Overseas Bank Phils. vs. Rosemoore Mining &
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participation in the preparation and execution of the loan

agreement would render them personally liable. Dr.
Pascual, on the other hand, was included as petitioner only
in the Malolos case because it involved properties
registered in her name. As correctly pointed out by the
Court of Appeals, Dr. Pascual is a real party-in-interest in
the Malolos case because she stood to benefit or suffer from
the judgment in the suit. Dr. Pascual, however, was not
included as plaintiff in the Manila case because her
interest therein was not personal but merely in her
capacity as officer of Rosemoor.
As regards the identity of rights asserted and reliefs
prayed for, the main contention of Rosemoor in the Manila
case is that the Bank had failed to deliver the full amount
of the loan, as a consequence of which Rosemoor demanded
the remittance of the unreleased portion43 of the loan and
payment of damages consequent thereto. In contrast, the
Malolos case was filed for the purpose of restraining the
Bank from proceeding with the consolidation of the titles
over the foreclosed Bulacan properties because the loan
secured by the44
mortgage had not yet become due and
demandable. While the right asserted in the Manila case
is to receive the proceeds of the loan, the right sought in
the Malolos case is to restrain the foreclosure of the
properties mortgaged to secure a loan that was not yet due.
Moreover, the Malolos case is an action to annul the
foreclosure sale that is necessarily
45
an action affecting the
title of the property sold. It is therefore a real action
which should be commenced and tried 46
in the province
where the property or part thereof lies. The Manila case,
on the other hand, is a

_______________

43 Rollo, (G.R. No. 163521), pp. 283-284.

44 Id., at pp. 236-237.
45 Fortune Motors (Phils.), Inc. v. Court of Appeals, G.R. No. 76431, 16
October 1989, 178 SCRA 564, 568-569.
46 RULES OF COURT, Rule 4, Sec. 1.

136

136 SUPREME COURT REPORTS ANNOTATED

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.
47
personal action involving as it does the enforcement of a
contract between Rosemoor, whose office is in Quezon City,
and the48 Bank, whose principal office is in Binondo,
Manila. Personal actions may be commenced and tried
where the plaintiff or any of the principal plaintiffs resides,
or where the defendants or any of the49principal defendants
resides, at the election of the plaintiff.
It was subsequent to the filing of the Manila case that
Rosemoor and Dr. Pascual saw the need to secure a writ of
injunction because the consolidation of the titles to the
mortgaged properties in favor of the Bank was in the
offing. But then, this action can only be commenced where
the properties, or a portion thereof, is located. Otherwise,
the petition for injunction would be dismissed for improper
venue. Rosemoor, therefore, was warranted in filing the
Malolos case and cannot in turn be accused of forum
shopping.
Clearly, with the foregoing premises, it cannot be said
that respondents committed forum shopping.

Action to nullify foreclosure sale of mortgaged

properties in Bulacan and Nueva Ecija before the
Malolos RTC

The Bank challenges the Malolos RTCÊs jurisdiction over

the action to nullify the foreclosure sale of the Nueva Ecija
properties along with the Bulacan properties. This question
is

_______________

47 A personal action is one brought for the recovery of personal

property or for the enforcement of some contract or for the recovery of
damages for its breach, or the recovery of damages for the commission of
an injury to the person or property. See Asset Privatization Trust v. Court
of Appeals, 381 Phil. 530, 550; 324 SCRA 533, 551 (2000) citing The Dial
Corporation v. Soriano, G.R. No. L-82330, May 31, 1988, 161 SCRA 737,
742 citing Hernandez v. DBP, L-31095, June 18, 1976, 71 SCRA 290, 292.
48 Rollo, (G.R. No. 159669), p. 159.
49 RULES OF COURT, Rule 4, Sec. 2.

137

VOL. 518, MARCH 12, 2007 137

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.

50
actually a question of venue and not of jurisdiction, which 51
if improperly laid, could lead to the dismissal of the case.
The rule on venue of real actions is provided in Section
1, Rule 4 of the 1997 Rules of Civil Procedure, which reads
in part:

„Section 1. Venue of Real Actions.·Actions affecting title to or

possession of real property, or interest therein, shall be commenced
and tried in the proper court which has jurisdiction over the area
wherein the real property involved, or a portion thereof, is situated.
x x x‰
The venue of the action for the nullification of the
foreclosure sale is properly laid with the Malolos RTC
although two of the properties together with the Bulacan
properties are situated in Nueva Ecija. Following the
above-quoted provision of the Rules of Court, the venue of
real actions affecting properties found in different
provinces is determined by the singularity or plurality of
the transactions involving said parcels of land. Where said
parcels are the object of one and the same transaction, the
venue is in the court of52any of the provinces wherein a
parcel of land is situated.
Ironically, the Bank itself correctly summarized the
applicable jurisprudential
53
rule in one of the pleadings
before the Court. Yet the Bank itself has provided the
noose on which it

_______________

50 Unimasters Conglomeration, Inc. v. Court of Appeals, 335 Phil. 415;

267 SCRA 759 (1997).
51 RULES OF COURT, Rule 16, Sec. 1(c).
52 REGALADO, REMEDIAL LAW COMPENDIUM, Vol. 1 (1999 ed.),
p. 105, citing El Hogar Filipino v. Seva, 57 Phil. 573 (1932).
53 Rollo, (G.R. No. 159669), p. 597. Vide PetitionerÊs Memorandum.
The Bank stated:

„Where the subject matter of the action involves various parcels of land
situated in different provinces, the venue is determined by the singularity or
plurality of the transactions involving said parcels of land. Thus, where said
parcels are the

138

138 SUPREME COURT REPORTS ANNOTATED

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.

would be hung. Resorting to deliberate misrepresentation,

the Bank stated in the same pleading that „the Bulacan
and Nueva Ecija [p]roperties were not the 54
subject of one
single real estate mortgage contract.‰
In the present case, there is only one proceeding sought
to be nullified and that is the extra-judicial mortgage
foreclosure sale. And there is only one initial transaction
which served as the basis of the foreclosure sale and that is
the mortgage contract. Indeed, Rosemoor, through Dr.
Pascual, executed a lone mortgage contract where it
undertook to „mortgage the land/real property situated in
Bulacan and Nueva Ecija,‰ with the list of mortgaged
properties annexed thereto revealing six (6) properties in
Bulacan and two (2) properties in Nueva Ecija subject of
the mortgage.
This apparent deliberate misrepresentation cannot
simply pass without action. The real estate mortgage form
supplied to Rosemoor is the BankÊs standard pre-printed
form. Yet the Bank perpetrated the misrepresentation.
Blame must be placed on its doorstep. But as the BankÊs
pleading was obviously prepared by its counsel, the latter
should also share the blame. A lawyer shall not do any
falsehood, nor consent to the doing of any in court; nor
shall he mislead, or allow the Court

_______________

objects of one and the same transaction, the venue was in the then CFI of any
of the provinces wherein a parcel of land is situated‰ (Regalado, Remedial Law
Compendium, Vol. 1, p. 105). As enunciated by the Supreme Court in El Hogar
Filipino v. Seva (G.R. No. 36627, 19 November 1932), it is only „when various
parcels of land or real property situated in different provinces, are included in
one mortgage contract, (that) the Court of First Instance of the province
wherein they are situated or a part thereof is situated, has jurisdiction to take
cognizance of an action for the foreclosure of said mortgage, and the judgment
therein rendered may be executed in all the other provinces wherever the
mortgaged real property may be found.‰

54 Id., at pp. 596-597.

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VOL. 518, MARCH 12, 2007 139

United Overseas Bank Phils. vs. Rosemoore Mining &
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55
to be misled by any artifice. Both the BankÊs president
and counsel should be made to explain why they should not
be sanctioned for contempt of court.

Propriety of Default Order

The Court of Appeals did not touch upon the soundness or

unsoundness of the order of default although it is one of the
orders assailed by the Bank. However, the silence of the
appellate court on the issue does not improve the legal
situation of the Bank.
To recall, the Bank filed a motion to dismiss the Malolos
case. The Malolos 56 RTC denied the motion in an Order
dated 13 May 2002. In the same Order, the Malolos RTC
directed the Bank to file its answer to the petition
57
within
five (5) days from the receipt of the Order. The Bank
received a copy of the Order on 21 May 2002. Instead of
filing an answer, the Bank filed58 a motion for
reconsideration but only on 5 June 592002.
The motion for reconsideration could not have tolled
the running of the period to answer for two reasons. One, it
was filed late, nine (9) days after the due date of the
answer. Two, it was a mere rehash of the motion to dismiss;
hence, pro forma in nature. Thus, the Malolos RTC did not
err in declaring the Bank in default.

Deviation from the Prescribed Content of an Order

Denying a Motion to Dismiss

Finally, the Bank questions the Malolos RTCÊs Order dated

13 May 2002 denying its motion to dismiss on the ground
that

_______________

55 CODE OF PROFESSIONAL RESPONSIBILITY, Chapter III, Rule

10.01.
56 Rollo (G.R. No. 159669), p. 75.
57 Id.
58 Id., at p. 363.
59 Id., at pp. 287-291.

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140 SUPREME COURT REPORTS ANNOTATED

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.

it is contrary to law and jurisprudence because it had failed

to apprise the Bank of the legal basis for the denial.
The Bank adverts to the content requirement of an order
denying a motion to dismiss prescribed by Sec. 3, Rule
60
16 of
the Rules of Court. The Court in Lu Ym v. Nabua made a
thorough discussion on the matter, to quote:

„Sec. 3, Rule 16 of the Rules provides:

Sec. 3. Resolution of motion.·After the hearing, the court may dismiss

the action or claim, deny the motion or order the amendment of the
pleading.
The court shall not defer the resolution of the motion for the reason
that the ground relied upon is not indubitable.
In every case, the resolution shall state clearly and distinctly the
reasons therefor.

xxxx
Further, it is now specifically required that the resolution
on the motion shall clearly and distinctly state the reasons
therefor. This proscribes the common practice of per-
functorily dismissing the motion for „lack of merit.‰ Such
cavalier dispositions can often pose difficulty and
misunderstanding on the part of the aggrieved party in
taking recourse therefrom and likewise on the higher court
61
called upon to resolve the same, usually on certiorari.
The questioned order of the trial court denying the motion to
dismiss with a mere statement that there are justiciable questions
which require a full blown trial falls short of the requirement of
Rule 16 set forth above. Owing to the terseness of its expressed
justification, the challenged order ironically suffers from undefined
breadth which is a hallmark of imprecision. With its unspecific and
amorphous thrust, the issuance is inappropriate to the grounds
detailed in the motion to dismiss.

_______________

60 G.R. No. 161309, 23 February 2005, 452 SCRA 298.

61 Pefianco v. Moral, 379 Phil. 468; 322 SCRA 439 (2000); Intramuros
Administration v. Contacto, 450 Phil. 765; 402 SCRA 581 (2003).

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VOL. 518, MARCH 12, 2007 141

United Overseas Bank Phils. vs. Rosemoore Mining &
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While the requirement to state clearly and distinctly the reasons for
the trial courtÊs resolutory order under Sec. 3, Rule 16 of the Rules
does call for a liberal interpretation, especially since jurisprudence
dictates that it is decisions on cases submitted for decision that are
subject to the stringent requirement of specificity of rulings under
62
Sec. 1, Rule 36 of the Rules, the trial courtÊs order in this case
63
leaves too much to the imagination. (Emphasis supplied.)‰

The assailed order disposed of the motion to dismiss in this

wise:

„x x x x
After a careful scrutiny of the grounds cited in the Motion to
Dismiss and the arguments en contra contained in the Opposition
thereto and finding the Motion to Dismiss to be not well taken as
grounds cited are not applicable to the case at bar, the Court hereby
DENIES the instant Motion to Dismiss.
64
x x x x‰

Clearly, the subject order falls short of the content

requirement as expounded in Lu Ym v. Nabua. Despite the
aberration, however, the Bank was not misled, though it
could have encountered difficulties or inconvenience
because of it. Comprehending, as it did, that the Malolos
RTC did not share its position that Rosemoor had engaged
in forum-shopping, it went to great lengths to impress upon
the Court of Appeals that there was indeed forum shopping
on Rose-moorÊs part. But the appellate court did not
likewise agree with the Bank as it soundly debunked the
forum shopping charge. In fact, the same forum-shopping
argument has been

_______________

62 SECTION 1. Rendition of judgments and final orders.·A judgment

or final order determining the merits of the case shall be in writing
personally and directly prepared by the judge, stating clearly and
distinctly the facts and the law on which it is based, signed by him, and
filed with the clerk of the court.
63 Id., at pp. 307-307.
64 Rollo, (G.R No. 159669), pp. 283-284; Order dated 13 May 2002;
Penned by Presiding Judge Thelma R. Pinero Cruz.

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142 SUPREME COURT REPORTS ANNOTATED

United Overseas Bank Phils. vs. Rosemoore Mining &
Development Corp.
 fully ventilated before the Court but we are utterly
unimpressed as we made short shrift of the argument
earlier on. In the ultimate analysis, therefore, the trial
courtÊs blunder may be overlooked as it proved to be
harmless.
WHEREFORE, the decisions of the Court of Appeals
dated 26 February 2004 in CA-G.R. SP No. 76934 and
dated 20 June 2003 in CA-G.R. SP No. 73358 are
AFFIRMED. Petitioner United Overseas Bank, Phils. and
its counsel, Siguion Reyna Montecillo & Ongsiako Law
Offices, are given ten (10) days from notice to EXPLAIN
why they should not be held in contempt of court for
making a misrepresentation before the Court as adverted
to in this Decision.
Costs against petitioner.
SO ORDERED.

Quisumbing (Chairperson), Carpio, Carpio-Morales

and Velasco, Jr., JJ., concur.

Judgments affirmed.

Notes.·The failure of a judge to recognize that it is not

the general provisions of the Rules of Court on Venue of
Actions but Act No. 3135 which is the law in point dealing
particularly on extrajudicial foreclosure sales of real estate
mortgages is an utter display of ignorance of the law to
which he swore to maintain professional competence.
(Supena vs. De la Rosa, 267 SCRA 1 [1997])
Where the complaint is in the nature of a personal
action, the rules on venue at the time the complaint was
filed governs. (Davao Abaca Plantation Company, Inc. vs.
Dole Philippines, Inc., 346 SCRA 682 [2000])

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