FIRST DIVISION
[G.R. No. 215959. December 7, 2021.]
KOREA TRADE INSURANCE CORP., petitioner, vs.ATTY. SIMPLICIO A. PALANCA, BACOLOD REAL ESTATE DEVELOPMENT CORP., AND TOP HARBOR INTERNATIONAL, INC., respondents.
NOTICE
Sirs/Mesdames :
Please take notice that the Court, First Division, issued a Resolution datedDecember 7, 2021which reads as follows: HTcADC
"G.R. No. 215959 (Korea Trade Insurance Corp. v. Atty. Simplicio A. Palanca, Bacolod Real Estate Development Corp., and Top Harbor International, Inc.). — On March 26, 2013, Korea Trade Insurance Corp. (Korea Trade) filed a Complaint 1 for sum of money against Atty. Simplicio A. Palanca, Bacolod Real Estate Development Corp. and Top Harbor International, Inc. (Palanca, et al.) before the Regional Trial Court (RTC) docketed as Civil Case No. 13-14132. Korea Trade claimed US$4,515,088.66 plus interest which represents the unpaid cost of the steel sheet files, dredger pipes and crushers that Palanca, et al., purchased. 2 Korea Trade authorized its Chief Executive Director Cho Kye-Ryoong to sign the complaint pursuant to the following Board of Directors (BOD) Resolution, 3 thus:
RESOLVED, that the following officers of KOREA TRADE INSURANCE CORPORATION, x x x, be AUTHORIZED, as they are hereby AUTHORIZED, to approve the filing of lawsuits against foreign corporations, to sign the corresponding complaint and such other papers and documents as are required by the laws of origin of the foreign corporation, and to delegate full authority to perform these acts, to wit:
Lawsuit above US$10,000,000: Chief Executive Director
Lawsuit below US$10,000,000: Executive Director
Lawsuit below US$5,000,000: Senior Director of the relevant department
xxx xxx xxx
On the other hand, Palanca, et al., put up the following affirmative defenses: (a) lack of legal capacity to sue in the Philippine courts; (b) prescription; (c) payment; (d) the verification lacks competent evidence of identity of the person signing; and (e) the complaint lacks proper certification and attestation. 4 Palanca, et al., then filed a motion to set the defenses for hearing. Yet, the RTC ordered the parties to file their respective memorandum. Specifically, Palanca, et al., pointed out that the BOD Resolution authorized Korea Trade's Chief Executive Director to sign complaints involving US$10,000,000 and above. Nevertheless, the complaint involved the amount of US$4,515,088.66 only.
On February 5, 2014, the RTC resolved to dismiss the complaint on the ground that Korea Trade's Chief Executive Director has no power to file the complaint and sign the certification against forum shopping, thus:
Plaintiff referred, as its authority, the Secretary's Certificate embodying its Board Resolution arguing that the officers identified in the resolution are authorized to sign the complaint in their concurrent capacities. However, plaintiff itself contradict its own argument when it says in par. 4.08 of its reply to defendant's memorandum that "thus, plaintiff's interpretation of the level of authority subverts the letter and the spirit of the Resolution, where one or more officers are unavailable while the more senior officer is available to the sign the complaint."
Be that as it may, for the court to intelligently rule on the issue, a deeper and meticulous look at the Resolution was made. The court is not convinced with the plaintiff's ratiocination. The Board Resolution is bereft of any evidence that allows the officers named therein to sign in concurrent capacities. On the contrary, the Resolution has granted in express terms, all that it intended to grant the authorized officers named therein, categorically indicating the amount of the claim in a lawsuit that it could file and sign in behalf of the corporation, x x x.
xxx xxx xxx
A second look at the resolution further reveals that no specific authority to sign the certification of non-forum shopping were given to the officers named therein which is fatal to plaintiff's cause.
xxx xxx xxx
In view of these observations, the Court finds and so hold that the Chief Executive Director is not authorized to file this case.
WHEREFORE, under the obtaining circumstances, this case should be as it is hereby DISMISSED with cost against complainant.
SO ORDERED. 5
Korea Trade sought reconsideration 6 but was denied. 7 Hence, this Petition for Review on Certiorari raising pure question of law. Korea Trade argues that the Chief Executive Director is impliedly authorized to sign a complaint involving a lesser amount of US$4,515,088.66. The greater power includes the lesser power. Also, the Chief Executive Director has the authority to sign the certification against forum shopping. As indicated in the BOD Resolution, the Chief Executive Director, along with the Executive Director and the Senior Director, is authorized to sign the corresponding complaint and such other papers and documents as are required by the laws of origin of the foreign corporation.
The petition is meritorious.
A question of law arises when there is doubt as to what the law is on a certain state of facts. It must not involve an examination of the probative value of the evidence. 8 In this case, the issue as to the correct interpretation of Korea Trade's BOD Resolution is a legal and not a factual issue. An appeal which involved an interpretation of the true agreement between the parties necessarily raises a question of law. 9 Hence, direct recourse to the Court is allowed.
The BOD Resolution is explicit that Korea Trade's Chief Executive Director is authorized to approve the filing of lawsuits that involve US$10,000,000 and above. However, the BOD Resolution did not intend to limit the Chief Executive Director's authority. At most, the BOD Resolution merely emphasized the hierarchy of officers in relation to the lawsuits that the Chief Executive Director, Executive Director, and Senior Director may file. The BOD Resolution neither contains a word of command nor mandates strict compliance. As such, the language of the BOD Resolution is at best directory. Indeed, the power of Korea Trade's Chief Executive Director over lawsuits involving US$10,000,000.00 and above should be construed to include a lesser amount within its scope. Differently stated, the Chief Executive Director has concurrent capacity to sign complaints involving lesser amounts than what is provided in the BOD Resolution. Otherwise, a restrictive application of the BOD Resolution will result in absurdity and unjustifiable limit to the Chief Executive Director's authority.
At any rate, Korea Trade's BOD impliedly ratified the act of the Chief Executive Director in signing the complaint through silence or acquiescence. Ratification means that the principal voluntarily adopts, confirms, and gives sanction to some unauthorized act of its agent on its behalf. Ratification can be made either expressly or impliedly. Particularly, implied ratification may take various forms like silence or acquiescence, acts showing approval or adoption of the act, or acceptance and retention of benefits. 10 Notably, none from Korea Trade repudiated its Chief Executive Director's authority to sign the complaint. The silence of Korea Trade's BOD and other officers may be taken as agreement or approval of the Chief Executive Director's action.
Lastly, the power of Korea Trade's Chief Executive Director to sign the certification against forum shopping is undisputed. The BOD Resolution unequivocally provides that the Chief Executive Director, Executive Director, and Senior Director are authorized "to sign the corresponding complaint and such other papers and documents as are required by the laws of origin of the foreign corporation." Here, Palanca, et al., who originated from the Philippines, are considered foreign defendants in relation to Korea Trade. Verily, a certification against forum shopping is required to be executed when filing a complaint or other initiatory pleadings in Philippine courts.
FOR THESE REASONS, the Regional Trial Court's Resolution dated February 5, 2014 in Civil Case No. 13-14132 is REVERSED. The case is REMANDED to the trial court for continuation of the proceedings with dispatch.
SO ORDERED."
By authority of the Court:
(SGD.) LIBRADA C. BUENADivision Clerk of Court
By:
MARIA TERESA B. SIBULODeputy Division Clerk of Court
Footnotes
1. Rollo, pp. 34-44.
2. Id. at 41.
3. Id. at 188-195.
4. Id. at 55-64.
5. Id. at 194-195.
6. Id. at 96-102.
7. Id. at 114.
8. Republic v. Malabanan, 646 Phil. 631, 637-638 (2010); citing Leoncio v. De Vera, 569 Phil. 512, 516 (2008); and Far Eastern Surety and Insurance Co., Inc. v. People, 721 Phil. 760, 767 (2013); citing Heirs of Cabigas v. Limbaco, 670 Phil. 274, 285 (2011). See also Vda. de Formoso v. Philippine National Bank, 665 Phil. 184, 197 (2011).
9. F.F. Cruz & Co., Inc. v. HR Construction Corp., 684 Phil. 330, 346 (2012); citing Philippine National Construction Corporation v. Court of Appeals, 541 Phil. 658, 669 (2007). See also Malayan Insurance Co., Inc. v. St. Francis Square Realty Corp., 836 Phil. 442, 458 (2018). See also CE Construction Corp. v. Araneta Center, Inc., 816 Phil. 221, 262 (2017).
10. Koji Yasuma v. Heirs of Cecilio S. De Villa, et al., 531 Phil. 62, 68 (2006).