VENUE OF ACTIONS

JESUS DACOYCOY vs. INTERMEDIATE APPELLATE

COURT GR 74854. 2 April 1991. Fernan, C.J.
DOCTRINE: UNLESS AND UNTIL THE DEFENDANT OBJECTS TO THE VENUE IN A MOTION TO DISMISS, THE
VENUE CANNOT BE TRULY SAID TO HAVE BEEN IMPROPERLY LAID, AS FOR ALL PRACTICAL
INTENTS AND PURPOSES, THE VENUE, THOUGH TECHNICALLY WRONG, MAY BE
ACCEPTABLE TO THE PARTIES FOR WHOSE CONVENIENCE THE RULES ON VENUE HAD BEEN
DEVISED. THE TRIAL COURT CANNOT PREEMPT THE DEFENDANT'S PREROGATIVE TO
OBJECT TO THE IMPROPER LAYING OF THE VENUE BY MOTU PROPRIO DISMISSING THE
CASE.
FACTS: COMPLAINT: Petitioner Jesus Dacoycoy, a resident of Balanti, Cainta, Rizal, filed before the RTC,
Branch LXXI, Antipolo, Rizal, a complaint against private respondent Rufino de Guzman praying for the
annulment of two (2) deeds of sale involving a parcel of riceland situated in Barrio Estanza, Lingayen,
Pangasinan, the surrender of the produce thereof and damages for private respondent's refusal to have
said deeds of sale set aside upon petitioner's demand.
RTC RULING: Before summons could be served on private respondent as defendant therein, the
RTC Executive Judge issued an order requiring counsel for petitioner to confer with respondent
trial judge on the matter of venue. After said conference, the trial court dismissed the complaint
on the ground of improper venue. It found, based on the allegations of the complaint,
ASSERTION: that petitioner's action is a real action as it sought not only the annulment of the afore
stated deeds of sale but also the recovery of ownership of the subject parcel of riceland located in
Estanza, Lingayen, Pangasinan, which is outside the territorial jurisdiction of the trial court.
APPEAL TO CA: Petitioner appealed to the CA, which affirmed the order of dismissal of his complaint.
MODE OF APPEAL TO SC: Petition for Review
PETITION FOR REVIEW TO SC: In this petition for review, petitioner claimed that the CA erred in
affirming the finding of the trial court that the venue was improperly laid when the defendant, has
not even answered the complaint nor waived the venue.
PETITIONERS CLAIM:
● that the right to question the venue of an action belongs solely to the defendant and is waivable.
●without the defendant objecting that the venue was improperly laid, the trial court is
powerless to dismiss the case motu proprio.
PRIVATE RESPONDENTS CONTENTION: Private respondent, on the other hand, maintains that
the dismissal of petitioner's complaint is proper because
●
the complaint can "readily be assessed as (a) real action."
●
"every court of justice before whom a civil case is lodged is not even obliged to wait for
the defendant to raise that venue was improperly laid. The court can take judicial notice
and motu proprio dismiss a suit clearly denominated as real action and improperly filed
before it … the location of the subject parcel of land is controlling pursuant to Sec. 2, par.
(a), Rule 4 of the New Rules of Court … "
ISSUE: W/N moto proprio dismissal of petitioner’s complaint on the ground of improper venue was proper
HELD: NO.
No. The motu proprio dismissal of petitioner's complaint by respondent trial court on the ground of
improper venue is plain error, obviously attributable to its inability to distinguish between jurisdiction
and venue. Questions or issues relating to venue of actions are basically governed by Rule 4 of the
Revised Rules of Court. It is said that the laying of venue is procedural rather than substantive. It
relates to the jurisdiction of the court over the person rather than the subject matter. Provisions
relating to venue establish a relation between the plaintiff and the defendant and not between the court
and the subject matter. Venue relates to trial not to jurisdiction, touches more of the convenience of the
parties rather than the substance of the case. Jurisdiction treats of the power of the court to decide a
case on the merits; while venue deals on the locality, the place where the suit may be had.

Page 3
 Dismissing the complaint on the ground of improper venue is certainly not the appropriate course
of action at this stage of the proceeding, particularly as venue, in inferior courts as well as in the
courts of first instance (now RTC), may be waived expressly or impliedly. Where defendant fails to
challenge timely the venue in a motion to dismiss as provided by Section 4 of Rule 4 of the Rules
of Court, and allows the trial to be held and a decision to be rendered, he cannot on appeal or in a
special action be permitted to challenge belatedly the wrong venue, which is deemed waived.
Unless and until the defendant objects to the venue in a motion to dismiss, the venue cannot be
truly said to have been improperly laid, as for all practical intents and purposes, the venue,
though technically wrong, may be acceptable to the parties for whose convenience the rules on
venue had been devised. The trial court cannot pre-empt the defendant's prerogative to object to
the improper laying of the venue by motu proprio dismissing the case.
In the instant case, even granting for a moment that the action of petitioner is a real action,
respondent trial court would still have jurisdiction over the case, it being a regional trial court
vested with the exclusive original jurisdiction over "all civil actions which involve the title to, or
possession of, real property, or any interest therein . . ." in accordance with Section 19 (2) of
Batas Pambansa Blg. 129. With respect to the parties, there is no dispute that it acquired
jurisdiction over the plaintiff Jesus Dacoycoy, now petitioner, the moment he filed his complaint
for annulment and damages. Respondent trial court could have acquired jurisdiction over the
defendant, now private respondent, either by his voluntary appearance in court and his
submission to its authority, or by the coercive power of legal process exercised over his person.

PATRICIO DIAZ vs. JUDGE SANTOS ADIONG

GR 106847. 5 March 1993. Bellosillo, J.
DOCTRINE FROM THE PROVISION OF ARTICLE 360, THIRD PARAGRAPH OF THE REVISED PENAL CODE AS
AMENDED BY R.A. 4363, AN OFFENDED PARTY WHO IS AT THE SAME TIME A PUBLIC OFFICIAL
CAN ONLY INSTITUTE AN ACTION ARISING FROM LIBEL IN TWO (2) VENUES: THE PLACE
WHERE HE HOLDS OFFICE, AND THE PLACE WHERE THE ALLEGED LIBELOUS ARTICLES
WERE PRINTED AND FIRST PUBLISHED.
UNLESS AND UNTIL THE DEFENDANT OBJECTS TO THE VENUE IN A MOTION TO DISMISS
PRIOR TO A RESPONSIVE PLEADING, THE VENUE CANNOT TRULY BE SAID TO HAVE BEEN
IMPROPERLY LAID SINCE, FOR ALL PRACTICAL INTENTS AND PURPOSES, THE VENUE
THOUGH TECHNICALLY WRONG MAY YET BE CONSIDERED ACCEPTABLE TO THE PARTIES
FOR WHOSE CONVENIENCE THE RULES ON VENUE HAD BEEN DEVISED.
FACTS: COMPLAINT TO CITY PROSECUTOR AND RTC: The Mindanao Kris, a newspaper of general
circulation in Cotabato City, published in its front page the news article captioned "6-Point
Complaint Filed vs. Macumbal," and in its Publisher's Notes the editorial, "Toll of Corruption,"
which exposed alleged anomalies by key officials in the Regional Office of the Department of
Environment and Natural Resources.

ALLEGATIONS: The public officers alluded to, namely, private respondents Sultan Macorro L. Macumbal,
Sultan Linog M. Indol, Atty. Macabangkit M. Lanto and Atty. Mohamadali Abedin, instituted separate
criminal and civil complaints arising from the libel before the City Prosecutor's Office and the RTC in
Marawi City, against the publisher-editor of the Mindanao Kris, petitioner Patricio P. Diaz, and Mamala B.
Pagandaman, who executed a sworn statement attesting to the alleged corruption
RULING OF PROSECUTORS OFFICE: City Prosecutor's Office dismissed the criminal case; finds
● that it has no jurisdiction to handle this case and that the same be filed or instituted in
Cotabato City where complainant is officially holding office at the time respondents caused
the publication of the complained news item in the Mindanao Kris in Cotabato City
CIVIL COMPLAINT FOR DAMAGES: In the interim, the civil complaint for damages, was set for Pre-Trial
Conference. The defendants therein had already filed their respective Answers with Counterclaim.
MOTION TO DISMISS ACTION FOR DAMAGES: Petitioner Diaz moved for the dismissal of the
action for damages because the trial court did not have jurisdiction over the subject matter.
PETITIONERS ARGUMENTS: That the complaint should have been filed in Cotabato City and not
in Marawi City.

Page 4
 DENIAL OF MOTION TO DISMISS: Respondent judge denied petitioner's Motion to Dismiss for
lack of merit.
MOTION FOR RECONSIDERATION = DENIED: Diaz thereafter moved for reconsideration of the
order of denial, which was also denied
PETITION FOR CERTIORARI TO SC UNDER RULE 65: Hence this present petition for certiorari.
Petitioner Diaz contends RTC in Marawi City has no jurisdiction to entertain the civil action for
damages. He claims
● That the civil action for damages could not be rightfully filed in Marawi City as none of
the private respondents, who are all public officers, held office in Marawi City; neither
were the alleged libelous news items published in that city.
Private respondents claim that they maintained sub offices in Marawi City and thus RTC of
Marawi has jurisdiction
ISSUE: Whether or not RTC of Marawi was the proper venue.
HELD: NO.
The stipulation at the case at bar did not clearly indicate, through qualifying and restrictive words, that the
parties deliberately intended to exclude causes or actions from the operation of the ordinary permissive
rules on venue, and that they intended contractually to designate a specific venue to the exclusion of any
other court also competent and accessible to the parties under the ordinary rules on the venue of actions.
It is settled in this jurisdiction that the parties, by written agreement, may change or transfer the
venue of an action from one province to another. (Section 3 Rule 4 of the Rules of Court) We have
many times sustained the validity and enforceability of contractual stipulations relating to venue.
In the enforcement of the parties' stipulations concerning venue, it is, of course, the tenor of their
agreement which is of critical relevance. The relevant task, in other words, is determining the
intent of the parties as manifested in the words employed by them and, where such words are less
than clear, in other recognized indicators of the will of the contracting parties.
A careful reading of the terms of the stipulation — "I/We hereby expressly submit to the jurisdiction of the
courts of Valenzuela any legal action which may arise out of this promissory note" — shows that the
stipulation does not require the laying of venue in Valenzuela exclusively or mandatorily. The plain or
ordinary import of the stipulation is the authorizing of, or permission to bring, suit in Valenzuela; there is not
the slightest indication of an intent to bar suit in other competent courts. Permissive stipulations like the one
here considered have invariably received judicial approval and we have declared that either of the parties is
authorized to lay venue of an action in the court named in the stipulation. The stipulation here does not
purport to deprive either party of its right to elect, or option to have resort to, another competent court as
expressly permitted by Section 2(b) of Rule 4 of the Rules of Court, should such party choose to initiate a
suit. The stipulation here merely operated to confer or confirm a right upon a party to elect recourse to the
courts of Valenzuela or, alternatively, to go before any of the tribunals envisaged by the rules on venue, i.e.,
the courts of Makati, Quezon City and Bulacan.
In principle, the stipulation on venue here involved must be distinguished from stipulations which purport to
require or compel the parties to lay venue of an action in a specified place, and in that place only. The latter
type of venue stipulation must clearly indicate, through qualifying and restrictive words, that the parties
deliberately intended to exclude causes or actions from the operation of the ordinary permissive rules on
venue, and that they intended contractually to designate a specific venue to the exclusion of any other court
also competent and accessible to the parties under the ordinary rules on the venue of actions. Stipulations
of this exclusionary nature may, under certain circumstances, be characterized as unreasonable or as
contrary to public policy and, accordingly, not judicially enforceable. In practice, the task, as noted earlier, of
this Court when confronted with issues of this kind is always basically that of contract interpretation. In the
case at bar, neither qualifying nor restrictive words (e.g., "must," "only" or "exclusively") were employed
which could yield an intent on the part of the parties mandatorily to restrict the venue of actions arising out
of the promissory notes to the courts of Valenzuela only. Private respondents suggest that the use of the
words "any legal action" expressed a supposed agreement to bar actions before any court other than a
Valenzuela court. We do not agree, for we see no necessary or customary connection between the words
"any legal action" and an intent strictly to limit permissible venue to the Valenzuela courts. Intent so to
establish an inflexible restriction of otherwise permissible venue to one single place is not lightly to be
presumed or inferred from stipulations which, like that here

Page 5
 before us, include no qualifying or exclusionary terms. Express reservation of the right to elect
venue under the ordinary rules was, accordingly, necessary in the case at bar.

PHILIPPINE BANKING CORP. vs. HON. SALVADOR TENSUAN (RTC MAKATI)

GR 106920. 10 December 1993. Feliciano, J.
DOCTRINE: IN THE ABSENCE OF QUALIFYING OR RESTRICTIVE WORDS, VENUE STIPULATIONS IN A
CONTRACT SHOULD BE CONSIDERED MERELY AS AGREEMENT ON ADDITIONAL FORUM, NOT
AS LIMITING VENUE TO THE SPECIFIED PLACE.
FACTS: COMPLAINT TO RTC MAKATI: Collection of Sum of money with a prayer for preliminary attachment
ALLEGATIONS: Petitioner Philippine Banking Corporation (hereafter "Bank") is a commercial
banking corporation with principal office at Makati, Metro Manila. Petitioner Bank instituted a
complaint for collection of a sum of money, with a prayer for preliminary attachment, at the RTC of
Makati. It appears from the allegations of the Bank's complaint that respondent Circle Financial
Co, obtained several loans aggregating P1,000,000.00 from petitioner.
● Respondent Circle, for value received, delivered to petitioner Bank four (4) promissory notes,
each of which contained the stipulation that:
"I/We hereby expressly submit to the jurisdiction of the courts of Valenzuela any legal
action which may arise out of this promissory note."
● As security for the re-payment by respondent Circle of the sums loaned by petitioner Bank, eight (8)
individuals, who were impleaded as defendants in the complaint — namely, Avelino Deato, Miguel
Violago, Benjamin Santiago, Socorro Gomez, Nerissa Gloria, Filemon Marquez, Domingo Santiago and
Hilario Lopez — executed a Continuing Surety Agreement and undertook to pay jointly and severally
respondent Circle's obligations. Only five (5) out of the eight (8) individual obligors are respondents in
present case, namely: Domingo Santiago, Hilario Lopez, Avelino Deato, Benjamin P.
Santiago and Socorro Gomez.
On their due dates, Circle failed to pay its obligations under the promissory notes. Thereupon, petitioner
Bank demanded payment from the eight (8) individual sureties conformably with their promises contained in
the Continuing Surety Agreement; the individual obligors, however, also failed to pay.

WRIT OF PRELIMINARY ATTACHMENT: Petitioner moved for issuance of a writ of preliminary

attachment, alleging that
● respondent Circle had become insolvent and had been placed under receivership by the
Central Bank.
The trial judge granted the motion and issued a writ of preliminary attachment.
MOTION TO DISMISS FILED BY RESPONDENTS: A motion to dismiss was filed by the
respondents (Circle and the five [5] individual sureties served with summons) and averred that
the venue of the action was improperly laid since an agreement had fixed the venue of actions
arising from the promissory notes in Valenzuela, Metro Manila, only.
MOTION TO DISMISS APPROVED: Acting upon respondent's motion, respondent Judge
Tensuan found the motion to be meritorious, and thus dismissing the case. It held
● that the proper venue for an action is that stipulated in a document 'in case of any litigation
herefrom or in connection herewith' upon a rationale that had the parties intended to reserve
the right to choose venue under Section 2 (b), Rule 4 of the Rules of Court,
MOTION FOR RECONSIDERATION APPROVED: Petitioner moved for reconsideration but was denied.
PETITION FOR REVIEW ON CERTIORARI TO SC: Hence, this Petition for review on certiorari.
Petitioner Bank contends that venue was properly laid by petitioner Bank in the place where its
principal offices are located: i.e., Makati, Metropolitan Manila. It claims that:
● the stipulation contained in the promissory notes is merely an agreement to add the courts of
Valenzuela to the tribunals to which the parties may resort.
● the venue stipulation set out in the notes did not restrict or limit the permissible venue of
actions arising out of those notes to the courts of Valenzuela, to the exclusion of all the other
courts recourse to any one of which is authorized or permitted under the Rules of Court.

Page 6
 RESPONDENTS CONTENTION TO SC: Private respondents, in opposition, aver that the words
used in the stipulation here involved are clear and unambiguous. A promise to submit to the
jurisdiction of a specific court, without an express reservation of the right . . . resort to one or
more of the tribunals otherwise accessible under the Rules of Court, is an agreement fixing the
permissible venue in only one place, i.e., Valenzuela, to the exclusion of other competent courts.
ISSUE: Whether or not the case should ONLY be filed in Valenzuela
HELD: NO.
The stipulation at the case at bar did not clearly indicate, through qualifying and restrictive words, that the
parties deliberately intended to exclude causes or actions from the operation of the ordinary permissive
rules on venue, and that they intended contractually to designate a specific venue to the exclusion of any
other court also competent and accessible to the parties under the ordinary rules on the venue of actions.

It is settled in this jurisdiction that the parties, by written agreement, may change or transfer the
venue of an action from one province to another. (Section 3 Rule 4 of the Rules of Court) We have
many times sustained the validity and enforceability of contractual stipulations relating to venue.
In the enforcement of the parties' stipulations concerning venue, it is, of course, the tenor of their
agreement which is of critical relevance. The relevant task, in other words, is determining the
intent of the parties as manifested in the words employed by them and, where such words are less
than clear, in other recognized indicators of the will of the contracting parties.
A careful reading of the terms of the stipulation — "I/We hereby expressly submit to the jurisdiction of the
courts of Valenzuela any legal action which may arise out of this promissory note" — shows that the
stipulation does not require the laying of venue in Valenzuela exclusively or mandatorily. The plain or
ordinary import of the stipulation is the authorizing of, or permission to bring, suit in Valenzuela; there is not
the slightest indication of an intent to bar suit in other competent courts. Permissive stipulations like the one
here considered have invariably received judicial approval and we have declared that either of the parties is
authorized to lay venue of an action in the court named in the stipulation. The stipulation here does not
purport to deprive either party of its right to elect, or option to have resort to, another competent court as
expressly permitted by Section 2(b) of Rule 4 of the Rules of Court, should such party choose to initiate a
suit. The stipulation here merely operated to confer or confirm a right upon a party to elect recourse to the
courts of Valenzuela or, alternatively, to go before any of the tribunals envisaged by the rules on venue, i.e.,
the courts of Makati, Quezon City and Bulacan.
In principle, the stipulation on venue here involved must be distinguished from stipulations which purport to
require or compel the parties to lay venue of an action in a specified place, and in that place only. The latter
type of venue stipulation must clearly indicate, through qualifying and restrictive words, that the parties
deliberately intended to exclude causes or actions from the operation of the ordinary permissive rules on
venue, and that they intended contractually to designate a specific venue to the exclusion of any other court
also competent and accessible to the parties under the ordinary rules on the venue of actions. Stipulations
of this exclusionary nature may, under certain circumstances, be characterized as unreasonable or as
contrary to public policy and, accordingly, not judicially enforceable. In practice, the task, as noted earlier, of
this Court when confronted with issues of this kind is always basically that of contract interpretation. In the
case at bar, neither qualifying nor restrictive words (e.g., "must," "only" or "exclusively") were employed
which could yield an intent on the part of the parties mandatorily to restrict the venue of actions arising out
of the promissory notes to the courts of Valenzuela only. Private respondents suggest that the use of the
words "any legal action" expressed a supposed agreement to bar actions before any court other than a
Valenzuela court. We do not agree, for we see no necessary or customary connection between the words
"any legal action" and an intent strictly to limit permissible venue to the Valenzuela courts. Intent so to
establish an inflexible restriction of otherwise permissible venue to one single place is not lightly to be
presumed or inferred from stipulations which, like that here before us, include no qualifying or exclusionary
terms. Express reservation of the right to elect venue under the ordinary rules was, accordingly, necessary
in the case at bar.

Page 7
UNIMASTERS CONGLOMERATION, INC. vs. COURT OF APPEALS, KUBOTA AGRI-MACHINERY PHILS., INC.
GR 119657. 7 February 1997. Narvasa, C.J.
DOCTRINE: UNLESS THE PARTIES MAKE VERY CLEAR, BY EMPLOYING CATEGORICAL AND SUITABLY
LIMITING LANGUAGE, THAT THEY WISH THE VENUE OF ACTIONS BETWEEN THEM TO BE LAID
ONLY AND EXCLUSIVELY AT A DEFINITE PLACE, AND TO DISREGARD THE PRESCRIPTIONS OF
RULE 4, AGREEMENTS ON VENUE ARE NOT TO BE REGARDED AS MANDATORY OR
RESTRICTIVE, BUT MERELY PERMISSIVE, OR COMPLEMENTARY OF SAID RULE. THE FACT
THAT IN THEIR AGREEMENT THE PARTIES SPECIFY ONLY ONE OF THE VENUES MENTIONED IN
RULE 4, OR FIX A PLACE FOR THEIR ACTIONS DIFFERENT FROM THOSE SPECIFIED BY SAID
RULE, DOES NOT, WITHOUT MORE, SUFFICE TO CHARACTERIZE THE AGREEMENT AS A
RESTRICTIVE ONE.
FACTS: COMPLAINT: Filed by petitioner at RTC of Tacloban for damages for breach of contract, and injunction
with prayer for temporary restraining order
ALLEGATIONS: Kubota Agri-Machinery Philippines, Inc. (KUBOTA) and Unimasters Conglomeration, Inc.
(UNIMASTERS) entered into a "Dealership Agreement for Sales and Services" of the former's products in
Samar and Leyte Provinces. The contract contained, among others: A stipulation reading: " . . . All suits
arising out of this Agreement shall be filed with / in the proper Courts of Quezon City," and a provision
binding UNIMASTERS to obtain (as it did in fact obtain) a credit line with Metropolitan Bank and Trust
Co.-Tacloban Branch in the amount of P2,000,000.00 to answer for its obligations to KUBOTA. Five years
later, UNIMASTERS filed an action in the RTC of Tacloban City against KUBOTA, a certain Reynaldo Go,
and METROBANK for damages for breach of contract, and injunction with prayer for temporary
restraining order.
RTC RULING: On the same day the Trial Court issued a restraining order enjoining METROBANK from
"authorizing or effecting payment of any alleged obligation of . . . (UNIMASTERS) to defendant . . .
KUBOTA arising out of or in connection with purchases made by defendant Go against the credit line
caused to be established by . . . (UNIMASTERS) for and in the amount of P2 million covered by
defendant METROBANK . . . or by way of charging . . . (UNIMASTERS) for any amount paid and
released to defendant . . . (KUBOTA) by the Head Office of METROBANK in Makati, Metro-Manila . . ."
The Court also set the application for preliminary injunction for hearing on January 10, 1994 at 8:30
o'clock in the morning.
MOTION TO DISMISS AND MOTION FOR THE TRANSFER OF INJUNCTION: KUBOTA filed two
motions.
● For dismissal of the case on the ground of improper venue, and;
● For the transfer of the injunction hearing because its counsel was not available on
January 10 due to a prior commitment before another court.
KUBOTO’s CLAIMS: KUBOTA claims that notwithstanding that its motion to transfer hearing had
been granted, the Trial Court went ahead with the hearing on the injunction incident on January
10, 1994 during which it received the direct testimony of UNIMASTERS' general manager, Wilford
Chan; that KUBOTA's counsel was "shocked" when he learned of this on the morning of the 11th,
but was nonetheless instructed to proceed to cross-examine the witness; that when said counsel
remonstrated that this was unfair, the Court reset the hearing to the afternoon of that same day, at
which time Wilford Chan was recalled to the stand to repeat his direct testimony. It appears that
cross-examination of Chan was then undertaken by KUBOTA's lawyer with the "express
reservation that . . . (KUBOTA was) not (thereby) waiving and/or abandoning its motion to
dismiss;" and that while the cross-examination, exhibits were presented by said attorney who
afterwards submitted a memorandum in lieu of testimonial evidence.
DENIAL OF RTC’s MOTION TO DISMISS: Trial Court issued an Order authorizing the issuance of the
preliminary injunction prayed for, upon a bond of P2,000,000.00. And denied KUBOTA's motion to
dismiss. The Court held that the filing of the complaint in RTC of Tacloban is proper, because
REASON FOR DISMISAL: The plaintiff UNIMASTERS Conglomeration is holding its principal place
of business in the City of Tacloban while the defendant . . . (KUBOTA) is holding its principal place
of business in Quezon City. The proper venue therefore pursuant to Rules of Court would either
be Quezon City or Tacloban City at the election of the plaintiff. Quezon City and Manila (sic), as
agreed upon by the parties in the Dealership Agreement, are additional places other than the
place stated in the Rules of Court.

Page 8
 SPECIAL CIVIL ACTION OF CERTIORARI AND PROHIBITION TO CA: Both orders were challenged
as having been issued with grave abuse of discretion. KUBOTA filed a special civil action of
certiorari and prohibition with the Court of Appeals. It contended that
● The RTC had "no jurisdiction to take cognizance of . . . (UNIMASTERS') action considering
that venue was improperly laid,"
● UNIMASTERS had in truth "failed to prove that it is entitled to the . . . writ of preliminary
injunction;" and
● the RTC gravely erred "in denying the motion to dismiss.".
CA AGREED WITH KUBOTA: The CA agreed with KUBOTA that
● The stipulation respecting venue in its Dealership Agreement with UNIMASTERS did limit the venue
of all suits arising thereunder only and exclusively to "the proper courts of Quezon City."
● The participation of KUBOTA's counsel at the hearing on the injunction incident did not
operate as a waiver or abandonment of its objection to venue;
● Assuming KUBOTA's standard printed invoices provided that the venue of actions
thereunder should be laid at the Court of the City of Manila, this was inconsequential since
such provision would govern "suits or legal actions between petitioner and its buyers" but
not actions under the Dealership Agreement between KUBOTA and UNIMASTERS, the
venue of which was controlled by paragraph No. 7 thereof; and
● No impediment precludes issuance of a TRO or injunctive writ by the Quezon City RTC against
METROBANK-Tacloban since the same "may be served on the principal office of METROBANK
in Makati and would be binding on and enforceable against, METROBANK branch in Tacloban.
APPEAL TO SC: When, UNIMASTER’s MR was denied, it appealed to this Court.
UNIMASTER claims that CA erred
1) "in concluding, that the agreement on venue is limited to the proper courts of Quezon City
the venue of any complaint filed arising from the dealership agreement between them
2) "in ignoring the rule settled in Philippine Banking Corporation vs. Tensuan, that 'in the absence of
qualifying or restrictive words, venue stipulations in a contract should be considered merely as
agreement on additional forum, not as limiting venue to the specified place;" and in concluding,
contrariwise, that the agreement in the case at bar "was the same as the agreement on venue in the
Gesmundo case," and therefore, the Gesmundo case was controlling; and
3) "in concluding, KUBOTA’s participation in the hearing for the issuance of a preliminary injunction
did not constitute waiver of its objection to venue."
KUBOTA claims that RTC had no jurisdiction to take cognizance of UNIMASTERS’ action
considering that venue was improperly laid.
ISSUE: 1) Whether or not the participation by the lawyer of KUBOTA at the injunction hearing operated as
a waiver of its objection to venue
2) Whether this stipulation had the effect of effectively eliminating the latter as an optional venue
and limiting litigation between UNIMASTERS and KUBOTA only and exclusively to Quezon City.
3) Whether or not RTC had no jurisdiction to take cognizance of UNIMASTERS’ action considering
that venue was improperly laid
HELD: 1) No.
The record shows that when KUBOTA's counsel appeared before the Trial Court, and while he cross
examines Chan, KUBOTA’s lawyer told the Court: "Your Honor, we are not waiving our right to submit the
Motion to Dismiss." Under these circumstances, no waiver or abandonment can be imputed to KUBOTA.
2) No.
Absent additional words and expressions definitely and unmistakably denoting the parties' desire and
intention that actions between them should be ventilated only at the place selected by them, Quezon City
— or other contractual provisions clearly evincing the same desire and intention — the stipulation should be
construed, not as confining suits between the parties only to that one place, Quezon City, but as allowing
suits either in Quezon City or Tacloban City, at the option of UNIMASTERS. Rule 4 of the Rules of Court sets
forth the principles generally governing the venue of actions, whether real or personal, or involving persons
who neither reside nor are found in the Philippines or otherwise. Agreements on venue are explicitly allowed.
"By written agreement of the parties the venue of an action may be changed or transferred from one
province to another." Sec. 3, Rule 4, Rules of Court. Parties may by stipulation

Page 9
waive the legal venue and such waiver is valid and effective being merely a personal
privilege, which is not contrary to public policy or prejudicial to the third persons. It is a
general principle that a person may renounce any right which the law gives unless
such renunciation would be against public policy. Unless the parties make very clear,
by employing categorical and suitably limiting language, that they wish the venue of
actions between them to be laid only and exclusively at a definite place, and to
disregard the prescriptions of Rule 4, agreements on venue are not to be regarded as
mandatory or restrictive, but merely permissive, or complementary of said rule. The
fact that in their agreement the parties specify only one of the venues mentioned in
Rule 4, or fix a place for their actions different from those specified by said rule, does
not, without more, suffice to characterize the agreement as a restrictive one. There
must, to repeat, be accompanying language clearly and categorically expressing their
purpose and design that actions between them be litigated only at the place named by
them, regardless of the general precepts of Rule 4; and any doubt or uncertainty as to
the parties' intentions must be resolved against giving their agreement a restrictive or
mandatory aspect. Any other rule would permit of individual, subjective judicial
interpretations without stable standards, which could well result in precedents in
hopeless inconsistency. The record of the case at bar discloses that UNIMASTERS has
its principal place of business in Tacloban City, and KUBOTA, in Quezon City. Under
Rule 4, the venue of any personal action between them is "where the defendant or any
of the defendants resides or may be found, or where the plaintiff or any of the plaintiffs
resides, at the election of the plaintiff." In other words, Rule 4 gives UNIMASTERS the
option to sue KUBOTA for breach of contract in the Regional Trial Court of either
Tacloban City or Quezon City.
3) No.
RTC had jurisdiction. venue has nothing to do with jurisdiction, except in criminal
actions. This is fundamental. The action at bar, for the recovery of damages in an
amount considerably more than P20,000.00, is assuredly within the jurisdiction of a
Regional Trial Court. Assuming that venue was improperly laid in the Court where
the action was instituted, the Tacloban City RTC, that would be a procedural, not a
jurisdictional impediment — precluding ventilation of the case before that Court of
wrong venue notwithstanding that the subject matter is within its jurisdiction.
However, if the objection to venue is waived by the failure to set it up in a motion
to dismiss, the RTC would proceed in perfectly regular fashion if it then tried and
decided the action.