Filipinas Industrial Corp. v. San Diego
REITERATIONFacts
1. The Antecedents: Respondent Pastor D. Ago, acting as attorney-in-fact for Francisco Laiz, filed a complaint for damages with preliminary attachment and injunction against Filipinas Industrial Corporation, Ruben Co., Inc., Honorio Allado, Arnaldo Borre, and Emilio Ongoy. The complaint alleged that Ago was the lawful attorney-in-fact of Francisco Laiz, a resident of General Santos, Cotabato, and that the defendant corporations had their principal offices in General Santos, Cotabato, while the individual defendants resided in General Santos or Davao City. The core of the dispute revolved around Ago's authority to file suit in his own name on behalf of Laiz. 2. Procedural History: The petitioners, defendants in the lower court, filed a motion to dismiss the complaint, arguing that the venue was improperly laid as the action was personal and the real party in interest, Francisco Laiz, resided in Cotabato. They also contended that the action was not brought in the name of the real party in interest. Respondent Judge Lourdes P. San Diego denied these motions, ruling that an agent with express authorization could sue in his own name and that since Ago resided in Quezon City, the suit could be filed there. After a motion for reconsideration was denied, the petitioners filed the instant petition for certiorari with preliminary injunction. 3. The Petition: Petitioners seek a writ of certiorari to annul the respondent Judge's orders denying their motions to dismiss and to enjoin her from further proceedings in Civil Case No. Q-7228, praying for the dismissal of the complaint. They argue that the respondent Judge acted with grave abuse of discretion by disregarding established jurisprudence that an agent or attorney-in-fact cannot bring an action in their own name on behalf of a disclosed principal, as the real party in interest must prosecute the action. The petition specifically invokes the principle that an action must be brought in the name of the real party in interest, citing previous Supreme Court rulings.
Issue(s)
Whether an attorney-in-fact, when so authorized by a special power of attorney, may bring an action in his own name for a disclosed principal. Whether the respondent Judge committed a grave abuse of discretion in denying the motion to dismiss.
Ruling
The petition is granted. The respondent Judge is enjoined from further proceeding with Civil Case No. Q-7228, and the complaint in said case is ordered dismissed.
Ratio Decidendi
On the issue of whether an attorney-in-fact may bring an action in his own name for a disclosed principal: The Court held that an attorney-in-fact cannot bring an action in his own name for a disclosed principal, even if expressly authorized by a special power of attorney. This is mandated by Section 2 of Rule 3 of the old Rules of Court, which states that "Every action must be prosecuted in the name of the real party in interest." The real party in interest is defined as the party who would be benefited or injured by the judgment or is entitled to the avails of the suit. Previous jurisprudence, specifically citing Jose M. Arroyo, as attorney-in-fact of Ignacio Arroyo vs. Matias Granada and Celedonia Gentero, Catalino Hilario, representing Andres Garcia vs. La Congregacion de San Vicente de Paul, and C.E. Salmon and Pacific Commercial Company vs. Chino Tan Cueco, has consistently held that an attorney-in-fact is not the real party in interest and has no legal standing to bring an action in his own name. The Court reiterated that a judgment rendered for or against an attorney-in-fact personally or as such would not bind or affect the principal, rendering the proceedings futile. Therefore, the action commenced by respondent Pastor D. Ago in his own name, despite being an attorney-in-fact for Francisco Laiz, was improper and could not be maintained. On the issue of whether the respondent Judge committed a grave abuse of discretion in denying the motion to dismiss: The Court found that the respondent Judge acted with grave abuse of discretion tantamount to acting without jurisdiction. By denying the motion to dismiss and allowing the case to proceed despite the clear violation of the rule on the real party in interest, the respondent Judge disregarded applicable provisions of law and established jurisprudence. The Court emphasized that proceeding with a case that cannot be maintained due to a defect in the party plaintiff is a waste of judicial time. The ruling in Ceferino Marcelo vs. Nazario de Leon was cited, which affirmed that even with express authorization to sue, the action must still be filed in the name of the principal who is the real party in interest. Consequently, the respondent Judge's order was deemed erroneous and capricious, necessitating the dismissal of the complaint.
Main Doctrine
An attorney-in-fact, even when expressly authorized by a special power of attorney to sue, cannot bring an action in his own name for a disclosed principal, as the action must be prosecuted in the name of the real party in interest.