G.R. No. 183843; January 19, 2011
Golden Arches Development Corporation, Petitioner, vs. St. Francis Square Holdings, Inc., Respondent.

FACTS

In June 1991, petitioner Golden Arches Development Corporation entered into a lease contract over a property in Ortigas Center, Mandaluyong City, owned by Prince City Realty, Inc. The lease was to terminate on February 27, 2008. On November 2, 2006, petitioner informed respondent St. Francis Square Holdings, Inc., the successor-in-interest of Prince City Realty, Inc., of its intention to discontinue the lease. After failed amicable negotiations, respondent filed an action for breach of contract and damages against petitioner before the Regional Trial Court (RTC) of Mandaluyong on May 4, 2007.
Petitioner filed a Motion to Dismiss on grounds of lack of cause of action and improper venue. It argued that respondent’s principal address, as shown by its 2007 Amended Articles of Incorporation and other Securities and Exchange Commission (SEC) records, was in Makati City. Petitioner contended that under Section 2, Rule 4 of the Rules of Court, the complaint, being a personal action, should have been filed in Makati where the plaintiff (respondent) allegedly resided.
Respondent opposed the motion, claiming it had closed its Makati office effective December 31, 2005, and was now holding office in Mandaluyong City, of which petitioner was aware. The RTC denied the motion to dismiss, ruling that since respondent’s Articles of Incorporation stated its principal office was in “Metro Manila,” venue was properly laid in Mandaluyong, which is part of Metro Manila.
Petitioner moved for reconsideration, pointing out that respondent violated SEC Memorandum Circular No. 03 (dated February 16, 2006), which required a specific address (e.g., street, barangay, city/municipality) and no longer allowed “Metro Manila” as the principal office address in the Articles of Incorporation. Despite respondent’s 2007 Amended Articles still indicating “Metro Manila,” the RTC denied the motion. The Court of Appeals affirmed the RTC’s order, prompting the present petition.

ISSUE

Whether the Regional Trial Court of Mandaluyong City is the proper venue for the personal action filed by respondent St. Francis Square Holdings, Inc.

RULING

The Supreme Court DENIED the petition and AFFIRMED the Court of Appeals’ decision, holding that venue was properly laid in Mandaluyong City.
The Court ruled that the complaint for enforcement of contractual provisions and recovery of damages is a personal action. Under Section 2, Rule 4 of the Rules of Court, a personal action may be commenced and tried where the plaintiff resides, at the plaintiff’s election. For a domestic corporation, its residence is the place where its principal office is located as stated in its articles of incorporation.
However, the Court emphasized that venue is a procedural rule intended for the convenience of the plaintiff and its witnesses and to promote the ends of justice. Although respondent’s 2007 Amended Articles of Incorporation indicated its principal office address as “Metro Manila” (contrary to the specific address requirement of SEC Memorandum Circular No. 03), the evidence showed that respondent had actually been holding its principal office in Mandaluyong City at the time it filed the complaint. Petitioner’s own letters to respondent (dated November 2, 2006, December 18, 2006, and January 2, 2007) used respondent’s address at St. Francis Square Mall, Julia Vargas, Ortigas Center, Mandaluyong City. Respondent’s letters to petitioner before filing the complaint also indicated the same Mandaluyong address. Thus, petitioner was put on notice that respondent’s actual business address was in Mandaluyong.
Consequently, respondent’s choice to file the complaint in Mandaluyong, where it actually resided or held its principal office, was proper and must be respected. The primary objective of venue rules is the convenience of the plaintiff and the orderly administration of justice, which respondent’s choice served.