GR 111837; (October, 1995) (Digest)
G.R. No. 111837 October 24, 1995
NEW YORK MARINE MANAGERS, INC., petitioner, vs. COURT OF APPEALS and VLASSONS SHIPPING INC., respondents.
FACTS
Petitioner New York Marine Managers, Inc., a foreign insurance corporation, paid a claim for cargo loss on a shipment of soda ash insured by it. As subrogee, it filed a complaint for damages against private respondent Vlasons Shipping, Inc., the domestic carrier, before the Regional Trial Court of Manila. The complaint alleged petitioner was “engaged in an isolated transaction” in this case. Private respondent moved to dismiss, asserting petitioner lacked legal capacity to sue. The trial court denied the motion, ruling the allegation of an isolated transaction sufficiently pleaded capacity.
Private respondent elevated the matter via certiorari to the Court of Appeals. The appellate court granted the petition, finding the complaint fatally defective for failing to allege petitioner’s duly authorized representative or resident agent in the Philippines. It enjoined the trial court from proceeding except to dismiss the case. Petitioner then filed this special civil action for certiorari under Rule 65, assailing the appellate court’s decision.
ISSUE
Whether the Court of Appeals committed grave abuse of discretion in ruling that the complaint was fatally defective for failing to allege petitioner’s duly authorized representative or resident agent in the Philippines.
RULING
The petition is denied. The proper remedy from a Court of Appeals decision is a petition for review under Rule 45, not certiorari under Rule 65. The assigned errors pertain to the legal soundness of the decision, not jurisdictional errors, and thus are not correctible by certiorari. Even if treated as a Rule 45 petition, it must fail.
On the substantive issue, while a foreign corporation not doing business in the Philippines may sue on an isolated transaction, the complaint must affirmatively plead this qualifying circumstance as an essential part of its capacity to sue. Mere allegation that it is a foreign corporation is insufficient, as it conjures two possibilities: doing business (requiring a license) or not (exempt under the isolated transaction rule). The complaint’s bare statement that petitioner was “engaged in an isolated transaction” is a conclusion of law, not an ultimate fact. It fails to sufficiently disclose the exempt status necessary to confer capacity.
Furthermore, the complaint is fatally defective for not alleging petitioner’s duly authorized representative or resident agent in the Philippines. When the authority of counsel is challenged, as it was here, he must show proof of such authority to bind his client. Counsel for petitioner failed to present competent proof of his authorization to institute the suit. Therefore, the Court of Appeals correctly held the complaint insufficient. The assailed decision is affirmed.