G.R. No. 233448 , November 18, 2020
SM Prime Holdings, Inc., Petitioner, vs. Alfredo G. Marañon, Jr., in his official capacity as the Governor of the Province of Negros Occidental and Chairman of the Committee on Awards and Disposal of Real Properties, the Province of Negros Occidental, and the Committee on Awards and Disposal of Real Properties of the Province of Negros Occidental and its Members, namely: Patrick Lacson, Atty. Mary Ann Manayon-Lamis, Nilda Generoso, Lucille I. Chavez-Pines, Merlita V. Caelian, Enrique S. Pinongan, Ernie F. Mapa, Sangguniang Panlalawigan and its Members, and Ayala Land, Inc., Respondents.

FACTS

SM Prime Holdings, Inc. (SMPHI) sought to lease properties owned by the Province of Negros Occidental. After a series of failed public biddings, the Province proceeded with a negotiated sale, ultimately executing a Deed of Conditional Sale and Contract of Lease with Ayala Land, Inc. (ALI) on April 26, 2012. SMPHI subsequently filed a complaint before the Regional Trial Court (RTC) of Bacolod City, Branch 48, seeking the nullity of these contracts. SMPHI alleged that the Province fraudulently manipulated the bidding process in favor of ALI, violating procurement rules and constituting fraud under Article 1409 of the Civil Code.
The respondents, including the Province and ALI, moved for the dismissal of the complaint on the ground of forum shopping. They contended that SMPHI had previously raised the same core issues and sought similar relief in other judicial and quasi-judicial forums. These prior actions included a petition for certiorari before the RTC, Branch 50 (which was dismissed), an appeal to the Court of Appeals challenging the RTC’s decision, a complaint before the Commission on Audit (COA), and a consulta filed with the Land Registration Authority (LRA).

ISSUE

Whether SMPHI committed forum shopping, warranting the dismissal of its complaint before the RTC, Branch 48.

RULING

Yes, the Supreme Court ruled that SMPHI was guilty of forum shopping. Forum shopping exists when a party, seeking a more favorable ruling, institutes two or more actions or proceedings grounded on the same cause, involving the same parties, and raising identical or substantially similar reliefs. The Court found the element of identity of parties, rights asserted, and reliefs prayed for present across the multiple cases filed by SMPHI.
The legal logic is grounded in the principle of litis pendentia and the prohibition against multiplicity of suits. The Court meticulously examined the various actions initiated by SMPHI. The COA case challenged the propriety of the negotiated contract, the RTC certiorari petition assailed the committee resolution declaring a failure of bidding, the Court of Appeals appeal sought to reverse the RTC’s dismissal, and the LRA consulta aimed to annotate the pending case on the titles. All these proceedings, including the complaint before RTC Branch 48, shared the same fundamental objective: to nullify the award and the resulting contracts in favor of ALI by attacking the validity of the bidding process. By pursuing simultaneous remedies in different fora, SMPHI violated the rule against forum shopping, which is designed to prevent conflicting judgments, conserve judicial resources, and protect parties from vexatious litigation. Consequently, the dismissal of the complaint by the RTC, Branch 48, was affirmed.