GR 221641; (July, 2021) (Digest)
G.R. No. 221641, July 12, 2021
EAST WEST BANKING CORPORATION, PETITIONER, VS. IAN Y. CRUZ, PAUL ANDREW CHUA HUA, FRANCISCO T. CRUZ, AND ALVIN Y. CRUZ, RESPONDENTS.
FACTS
Petitioner East West Banking Corporation filed a Complaint for Sum of Money with Application for a Writ of Preliminary Attachment against respondents Ian Y. Cruz and Paul Andrew Chua Hua before the Regional Trial Court (RTC). The Bank impleaded Francisco T. Cruz and Alvin Y. Cruz as unwilling co-plaintiffs. The Bank alleged that Paul, its Sales Officer, debited P16,054,541.66 from the deposit accounts of Francisco and Alvin and credited it to Ian’s account, representing that Francisco and Alvin would “regularize” the transactions later. Ian then obtained a “back-to-back” loan from the Bank using the credited amount and used the same to pay the loan. Francisco and Alvin later demanded payment from the Bank based on Foreign Exchange Forward Contracts (FEFCs), which the Bank rejected as spurious. The Bank claimed the issuance of spurious FEFCs was part of a scheme by Ian and Paul to defraud Francisco, Alvin, and the Bank. The RTC initially granted the writ of preliminary attachment. Ian filed a Motion to Dismiss on grounds of failure to state a cause of action and lack of legal personality of the Bank to sue, arguing the Bank suffered no damage as it rejected the demand, and the real parties-in-interest were Francisco and Alvin. The RTC granted the motion and dismissed the Complaint. The Bank appealed to the Court of Appeals (CA) via a Notice of Appeal under Rule 41. The CA dismissed the appeal, holding that the issues raised were pure questions of law, making the appeal under Rule 41 the wrong mode; the proper remedy was a petition for review on certiorari under Rule 45 to the Supreme Court.
ISSUE
Whether the Bank availed of the correct remedy in assailing the RTC’s Order dismissing its Complaint.
RULING
No, the Bank did not avail of the correct remedy. The Supreme Court affirmed the CA’s dismissal. The issues of whether a complaint states a cause of action and whether a litigant is a real party-in-interest are pure questions of law. A question of law does not involve an examination of the probative value of evidence but concerns the correctness of the lower court’s application of law. The Bank’s contention that factual issues were involved—such as ownership of the accounts and whether it would suffer damage—was incorrect. In a motion to dismiss for failure to state a cause of action, the allegations in the complaint are hypothetically admitted. The determination is confined to the four corners of the complaint and does not require evidentiary analysis. Since the appeal raised only questions of law, the proper remedy was a petition for review on certiorari directly to the Supreme Court under Rule 45, not an ordinary appeal to the CA under Rule 41. The CA correctly dismissed the appeal for being the wrong mode.