Sweet lines Vs Hon.

Bernardo Teves

FACTS:

Sweet Lines is a shipping company which transports inter-island passengers and cargoes at Cagayan de
Oro City. Rogelio Tiro, a contractor, and Atty. Leovigildo Tandog bought tickets from Sweet Lines and
were bound to Bohol. When they were about to board M/S “Sweet Hope” which was bound for
Tagbilaran City via the port of Cebu, they were informed that the vessel will not proceed to Bohol
because most of the passengers were bound to Surigao. They were advised to relocate and board to
M/S “Sweet Town”. However, the said vessel was already full and they were forced to agree “ to hide at
the cargo section to avoid inspection of the officers of the Philippine Coastguard." Private respondents
alleged that they were, during the trip," "exposed to the scorching heat of the sun and the dust coming
from the ship's cargo of corn grits.” Further, the tickets they bought at Cagayan de Oro City for
Tagbilaran were not honored and they were constrained to pay for other tickets. Thus, Tandog and Tiro
filed a complaint against Sweet Lines for damages and breach of contract of carriage in the CFI of
Misamis Oriental (Cagayan de Oro is the capital of Misamis Oriental).

ISSUE:

(1) Whether or not a common carrier engaged in inter-island shipping may stipulate thru condition
printed at the back of passage tickets to its vessels that any and all actions arising out of the
contract of carriage should be filed only in a particular province or city, in this case the City of
Cebu, to the exclusion of all others.

(2) Whether or not the venue of the action should be in the City of Cebu as stipulated by the
condition in the ticket bought by Tandog and Tiro.

HELD:

No, the actuations of Sweet Lines (putting a condition at the back of its tickets fixing the venue for any
complaints filed against them in the City of Cebu) is contrary to public policy. Thus, the venue was not
improperly laid in the CFI of Misamis Oriental.

There is no question that there was a valid contract of carriage entered into by petitioner and private
respondents and that the passage tickets, upon which the latter based their complaint, are the best
evidence thereof. All the essential elements of a valid contract, i.e., consent, cause or consideration and
object, are present.

Considered in the light Of the foregoing norms and in the context of circumstances prevailing in the
inter-island shipping industry in the country today, the SC declared the condition at the back of the
passage to be void and unenforceable. First, under circumstances obligation in the inter-island shipping
industry, it is not just and fair to bind passengers to the terms of the conditions printed at the back of
the passage tickets. Second, the condition subverts the public policy on transfer of venue of proceedings
of this nature, since the same will prejudice rights and interests of innumerable passengers in different s
of the country who, under the said condition, will have to file suits against petitioner only in the City of
Cebu.
 Auction in Malinta vs Warren Embes Luyaben

Facts:

Warren Embes Luyaben filed a complaint for damages against Auction in Malinta, Inc. (AIMI) in RTC-
Kalinga where Luyaben resides. AIMI moved to dismiss the complaint on the ground of improper venue
by invoking the following stipulation in their agreement: ALL COURT LITIGATION PROCEDURES SHALL BE
CONDUCTED IN THE APPROPRIATE COURTS OF VALENZUELA CITY, METRO MANILA.

Issue:

Did the stipulation in the Agreement effectively limit the venue of the case exclusively to the proper
court of Valenzuela City?

Held:

No. Mere stipulation on the venue of an action is not enough to preclude parties from bringing a case in
other venues. It must be shown that such stipulation is exclusive. In the absence of qualifying or
restrictive words, such as “exclusively” and “waiving for this purpose any other venue, “shall only”
preceding the designation of venue, “to the exclusion of the other courts,” or words of similar import,
the stipulation should be deemed as merely an agreement on an additional forum, not as limiting venue
to the specified place.

United Overseas Bank Phils. v. Rosemoore Mining & Development Corp.

Facts: Rosemoore Mining & Development Corporation (Hereon Rosemoor) in order to secure a credit
facility amounting to 80Million executed a mortgage agreement with United Overseas Bank Phils.
(Hereon Bank) which covered six (6) parcels of land all registered under Rosemoor. Rosemoor defaulted
which caused the extrajudicial foreclosure of the properties. The bank was the highest bidder in all of
the properties. Hence the filing of the case by Rosemoor before the Manila RTC and Malolos RTC. (The
issue of the case, filing of 2 actions in 2 different courts) Manila RTC: (Personal Action) Rosemoor filed
an action to receive the remaining proceeds of the loan. However, the bank filed a motion to dismiss the
case because it contends Rosemoor is violating forum shopping, having initiated a case in Malolos RTC.
However the motion to dismiss was denied, likewise it was dismissed by the CA holding that there was
no forum shopping.

Issue: Whether or not venue of the filing of the cases resulted to forum shopping.

Held: The Supreme Court ruled in favor of Rosemoor, and affirming the ruling of the lower courts that
there was no violation of forum shopping Ratio: The Malolos case was filed for the purpose of
restraining the Bank from proceeding with the consolidation of the titles over the foreclosed Bulacan
properties because the loan secured by the mortgage had not yet become due and demandable. While
the right asserted in the Manila case is to receive the proceeds of the loan, the right sought in the
Malolos case is to restrain the foreclosure of the properties mortgaged to secure a loan that was not yet
due. Moreover, the Malolos case is an action to annul the foreclosure sale that is necessarily an action
affecting the title of the property sold. It is therefore a real action which should be commenced and
tried in the province where the property or part thereof lies. The Manila case, on the other hand, is a
personal action involving as it does the enforcement of a contract between Rosemoor, whose office is in
Quezon City, and the Bank, whose principal office is in Binondo, Manila. Personal actions may be
commenced and tried where the plaintiff or any of the principal plaintiffs resides, or where the
defendants or any of the principal defendants resides, at the election of the plaintiff.