G.R. No. 133576 ; July 13, 2000
Viewmaster Construction Corporation, petitioner, vs. Allen C. Roxas, State Investment Trust, Inc., Northeast Land Development, Inc., and State Properties Corporation, respondents.

FACTS

Petitioner Viewmaster Construction Corporation filed a complaint for specific performance, enforcement of an implied trust, and damages against respondents. Viewmaster alleged that it agreed to act as a guarantor for a loan obtained by respondent Allen Roxas from First Metro Investments, Inc. (FMIC), which Roxas used to gain control of State Investment Trust, Inc. This guaranty was conditioned on two promises: first, that Roxas would sell 50% of his acquired shares to Viewmaster at a premium; and second, that they would enter into a joint venture to develop two specific parcels of land. Upon FMIC’s release of the loan secured by Viewmaster’s guaranty, Roxas successfully gained control of the corporation. However, Roxas subsequently refused to honor both conditions despite demands, prompting Viewmaster to initiate the suit.
The respondents filed a Motion to Dismiss the complaint primarily on the grounds that the claim was unenforceable under the Statute of Frauds and that the complaint failed to state a cause of action. The Regional Trial Court initially dismissed the case but later reinstated it upon reconsideration. The Court of Appeals, however, granted the respondents’ petition for certiorari, set aside the RTC orders, and ordered the dismissal of the complaint. Viewmaster elevated the case to the Supreme Court via a petition for review.

ISSUE

Whether the Court of Appeals erred in dismissing the complaint on the grounds that it failed to state a cause of action and that the agreement was unenforceable under the Statute of Frauds.

RULING

The Supreme Court denied the petition and affirmed the decision of the Court of Appeals. On the sufficiency of the cause of action, the Court applied the test that only the allegations within the four corners of the complaint must be considered. The complaint failed to allege facts demonstrating the existence of a clear, lawful, and demandable right in favor of Viewmaster or a correlative obligation on the part of the respondents. The alleged agreement for the sale of shares and joint venture was not sufficiently pleaded with definitive terms to constitute an actionable right. Consequently, no valid judgment could be rendered based on the vague allegations.
Regarding the Statute of Frauds, the Court ruled that the alleged agreement, being a contract for the sale of shares and an agreement concerning real property development, fell within its coverage as it was not to be performed within one year from its making. The complaint itself did not allege that the agreement was in writing or that any exception to the Statute of Frauds applied. Therefore, the claim was correctly deemed unenforceable. The Court found it unnecessary to rule on the issue of judicial inhibition, as the dismissal of the complaint rendered it moot.