G.R. No. L-9404 December 27, 1956
PHILIPPINE MILLING COMPANY, petitioner, vs. THE COURT OF APPEALS and PHILIPPINE INDUSTRIAL EQUIPMENT COMPANY, respondents.

FACTS

The Philippine Industrial Equipment Company (Equipment Co.), a domestic corporation originally with its legal residence and principal office in Manila, was dissolved on April 12, 1950, with the dissolution approved by the Securities and Exchange Commission on December 22, 1951. During its liquidation period from September 7 to October 23, 1950, Equipment Co. sold machinery and office equipment to the Philippine Milling Company (Milling Co.), a domestic corporation with its residence and principal office in San Jose, Mindoro, leaving an unpaid balance of P2,122.46. Equipment Co. filed an action to recover this balance in the Court of First Instance of Rizal, claiming its principal office was in Makati, Rizal. Milling Co. raised the defense of improper venue, contending the action should have been filed in Manila where Equipment Co.’s legal residence was fixed in its articles of incorporation. The trial court found Equipment Co. had actually transferred its main office from Manila to Makati, Rizal, and rendered judgment in favor of Equipment Co. The Court of Appeals affirmed the decision but eliminated the award of attorney’s fees. Milling Co. appealed to the Supreme Court, reiterating its venue objection.

ISSUE

Whether the Court of First Instance of Rizal had proper venue over the action, considering Equipment Co.’s legal residence as stated in its unamended articles of incorporation was Manila, but its actual office was in Makati, Rizal, at the time of filing the complaint.

RULING

The Supreme Court affirmed the decision of the Court of Appeals with modification, holding that venue was properly laid in Rizal. The Court found that Equipment Co. had actually transferred its residence and office from Manila to Makati, Rizal, and at the time of filing the complaint, its actual residence was in Rizal. The Court rejected Milling Co.’s technical defense, noting it never questioned the correctness of the claim, suffered no unnecessary trouble or expense from the venue, and that the provisions on venue are for the convenience of the plaintiff. The Court considered the circumstances that Equipment Co. was already dissolved and in liquidation, making strict compliance with the formal amendment of its articles of incorporation to reflect the change of residence difficult, if not impossible. The Court restored the award of P400 as attorney’s fees, finding it just and equitable under Article 2208(11) of the New Civil Code, as plaintiff had prayed for twenty-five percent of the sum due as attorney’s fees.