G.R. No. 161838 ; April 7, 2010
Republic of the Philippines, represented by Dante Quindoza, in his capacity as Zone Administrator of the Bataan Economic Zone, Petitioner, vs. Coalbrine International Philippines, Inc. and Sheila F. Neri, Respondents.

FACTS

The Philippine Economic Zone Authority (PEZA) rescinded its contract with respondent Coalbrine International Philippines, Inc. for the latter’s rehabilitation and lease of the Bataan Hilltop Hotel. Coalbrine filed a Complaint for specific performance against PEZA in the RTC of Manila, which remains pending. Subsequently, respondents Coalbrine and its Managing Director, Sheila F. Neri, filed a separate Complaint for damages with a prayer for injunction in the RTC of Balanga, Bataan, against Zone Administrator Dante Quindoza. They alleged that Quindoza committed harassing acts, such as excavating the only access road and cutting the hotel’s water supply, causing operational paralysis and damages.
Petitioner, represented by Quindoza, filed a Motion to Dismiss the Balanga complaint on several grounds, including that the complaint was fatally defective for being unauthorized. Petitioner specifically argued that respondent Neri failed to attach proof of her authority to institute the suit on behalf of the corporate respondent, Coalbrine. The RTC denied the motion to dismiss, and the Court of Appeals affirmed this denial.

ISSUE

Whether the Regional Trial Court committed grave abuse of discretion in denying the Motion to Dismiss the complaint despite the failure of respondent Sheila F. Neri to show proof of her authority to file the suit on behalf of the corporation.

RULING

Yes. The Supreme Court granted the petition and ordered the dismissal of the complaint. The legal logic is anchored on a mandatory procedural requirement under Section 5, Rule 7 of the Rules of Court. This rule explicitly requires that if a pleading is signed by a person in a representative capacity, such as a corporate officer, the authority of that representative to act on behalf of the party must be shown in the pleading. This proof of authority is not a mere technicality but a requisite to establish that the suit is brought by a real party-in-interest and to prevent the prosecution of unauthorized suits.
The Court held that respondent Neri, in signing the verification and certification against forum shopping for the corporation, acted in a representative capacity. Her failure to attach any document—such as a secretary’s certificate or board resolution—demonstrating her authority to institute the action on behalf of Coalbrine rendered the complaint fatally defective. This defect is jurisdictional, as it goes to the very capacity of the plaintiff to sue. Consequently, the RTC’s denial of the motion to dismiss, despite this clear absence of requisite authority, constituted grave abuse of discretion amounting to lack or excess of jurisdiction. The Court emphasized that such a defect warrants the dismissal of the complaint, as the rule is designed to protect against unauthorized litigation.