G.R. No. 154830 ; June 8, 2007
PIONEER CONCRETE PHILIPPINES, INC., PIONEER PHILIPPINES HOLDINGS, and PHILIP J. KLEPZIG, petitioners, vs. ANTONIO D. TODARO, respondent.

FACTS

Respondent Antonio D. Todaro filed a complaint for sum of money and damages with preliminary attachment against Pioneer International Limited (PIL), its Philippine subsidiaries (Pioneer Concrete Philippines, Inc. and Pioneer Philippines Holdings, Inc.), and their officers. Todaro alleged that after resigning from his former company, PIL contacted him in May 1996. They reached an agreement where he would initially serve as a consultant for two to three months and would subsequently be employed as the manager of PIL’s ready-mix concrete operations in the Philippines if the company decided to invest. PIL commenced operations but refused to employ Todaro permanently.
Instead of filing an Answer, the petitioners (PCPI, PPHI, and Klepzig) moved to dismiss the complaint on grounds of lack of cause of action, lack of jurisdiction (claiming the case fell under the National Labor Relations Commission), and the doctrine of forum non conveniens. The Regional Trial Court denied the motions to dismiss, a decision affirmed by the Court of Appeals. Petitioners elevated the case to the Supreme Court via a Petition for Review on Certiorari.

ISSUE

The primary issues were: (1) whether the complaint stated a cause of action; (2) whether the RTC had jurisdiction over the subject matter; and (3) whether the doctrine of forum non conveniens warranted dismissal.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals. On the first issue, the Court held that in a motion to dismiss based on failure to state a cause of action, the test is the sufficiency of the allegations in the complaint. Todaro’s complaint sufficiently averred the existence of an agreement and a breach thereof, which is enough to sustain a cause of action. The veracity of these allegations and the defense that no contract was perfected due to a purported counter-offer are evidentiary matters to be resolved during trial, not at the motion to dismiss stage.
On jurisdiction, the Court ruled that the RTC properly exercised jurisdiction. Todaro’s complaint was essentially a civil action for damages arising from alleged pre-employment bad faith, premised on Articles 19 and 21 of the Civil Code. The action was not based on an employer-employee relationship but on alleged fraudulent misrepresentation during negotiations before any employment commenced. Such a claim for damages in a civil action falls within the jurisdiction of regular courts, not the NLRC.
Regarding forum non conveniens, the Court held it is not a ground for dismissal under Rule 16 of the Rules of Court. It is a principle addressed to the trial court’s sound discretion, the application of which depends on factual determinations, such as the convenience of the parties and the court’s ability to render an intelligent decision. These are matters of defense whose merits should be threshed out during trial, not in a motion to dismiss. The factual circumstances cited by petitioners did not justify dismissal at the pleading stage.