G.R. No. 120135; March 31, 2003
BANK OF AMERICA NT & SA and BANK OF AMERICA INTERNATIONAL, LTD., petitioners, vs. COURT OF APPEALS, HON. MANUEL PADOLINA, EDUARDO LITONJUA, SR., and AURELIO K. LITONJUA, JR., respondents.

FACTS

Eduardo Litonjua, Sr. and Aurelio Litonjua, Jr. (private respondents) filed a complaint before the Regional Trial Court of Pasig against Bank of America NT & SA and Bank of America International, Ltd. (petitioner banks). They alleged they were engaged in the shipping business through wholly-owned foreign corporations. They claimed the banks induced them to acquire additional vessels through loans offered to these corporations. The petitioners allegedly took complete control over the vessels’ operations and funds. The Litonjuas asserted that due to the banks’ breach of fiduciary duties and negligence, revenues declined, leading to the foreclosure and sale of all vessels. They claimed personal financial loss, including an amount equivalent to ten percent of the acquisition cost, and prayed for an accounting and damages.
The petitioner banks filed a Motion to Dismiss on the grounds of forum non conveniens and lack of cause of action, arguing the Litonjuas, as mere stockholders of the foreign corporate borrowers, had no personality to sue. The trial court denied the motion. The Court of Appeals, treating the subsequent petition as one for certiorari, affirmed the denial. Hence, this petition.

ISSUE

The core issues are: (1) Whether private respondents have the legal personality to sue; and (2) Whether the case should be dismissed on the ground of forum non conveniens.

RULING

The Supreme Court denied the petition, affirming the lower courts. On the first issue, the Court held that the complaint sufficiently alleged a cause of action in the private respondents’ personal capacity. The allegations of breach of trust and negligence were directed against the petitioners for acts that allegedly caused direct personal loss to the Litonjuas, distinct from the corporations’ losses. At the stage of a motion to dismiss, the averments in the complaint are deemed hypothetically admitted. The question of whether the claims properly belong to the corporations or the stockholders is a matter of evidence best determined during a full trial, not a ground for dismissal.
On the second issue, the Court ruled that the principle of forum non conveniens is not a ground for a motion to dismiss under Rule 16 of the Rules of Court. It is a prudential doctrine that a court may invoke to resist the imposition of an inconvenient jurisdiction. Its application is discretionary, considering both private interests (e.g., access to proof, availability of witnesses) and public interests (e.g., court congestion, local interest). The Court found no grave abuse of discretion in the trial court’s decision to assume jurisdiction. The petitioners failed to convincingly demonstrate that the Philippines is an inconvenient forum, especially given the allegations of acts committed by the banks’ branches that impacted the respondents. The choice of forum by the plaintiffs should not be lightly disturbed.