EN BANC
[ G.R. No. 119657, February 07, 1997 ]
UNIMASTERS CONGLOMERATION, INC., PETITIONER, VS. COURT OF APPEALS AND KUBOTA AGRI-MACHINERY PHILIPPINES, INC., RESPONDENTS.
SEPARATE CONCURRING OPINION
REGALADO, J.:
I find no plausible reason to withhold concurrence from the opinion meticulously crafted by the Chief Justice which provides a taxonomy of cases for future decisions. It has figuratively parted the jurisprudential waves, laying on one side a catalogue of holdings on the strict binding effect of a venue stipulation and, on the other, those rulings on when it may be disregarded. This concurring opinion merely suggests, therefore, some parametric qualifications on the applicability of the first type, that is, the agreement which demands literal compliance by the parties.
Summarized, the rule is that if the parties to a contract merely agree on the venue of any case arising therefrom, in addition to or aside from the legal venue provided therefor by the Rules of Court or the law, that stipulation is merely permissive and the parties may choose to observe the same or insist on the alternative venues in the Rules or the law.
If, on the other hand, such venue stipulation contains qualifying, restrictive, mandatory or exclusionary terms indicating that the additional forum shall be the unalterable venue of prospective suits ex contractu between them, then such agreement shall necessarily be observed to the exclusion of and shall bar resort to another forum which would otherwise have been the reglementary prescription of venue for the case.
Of the latter genre are the use of such qualifying words like exclusively, only, solely, limited to, in no other place, to the exclusion of, or other terms indicative of a clear and categorical intent to lay the venue at a specific place and thereby waiving the general provisions of the Rules or the law on venue or proscribing the filing of suit in any other competent court.
These guidelines should accordingly be drawn from the decision in this case, viz.: (1) the agreement on venue shall, in the first instance, be normally considered as merely permissive; (2) to be restrictive, the language or terminology employed in the stipulation must be unequivocal and admit of no contrary or doubtful interpretation; (3) in case of irreconcilable doubt, the venue provision shall be deemed to be permissive; and (4) in ascertaining the intent in that provision which reasonably admits of more than one meaning, the construction should be adopted which most conduces to the convenience of the parties.
In addition to the foregoing, the writer suggests, by way of caveat, the matter of adhesion contracts and restrictions of public policy as qualifying or delimiting the application of the mandatory effect of restrictive venue stipulations.ℒαwρhi৷
Implicit in an agreement on venue, as in any contract or its terms, is the legal imperative that the consent of the parties thereto were voluntarily, freely and intelligently given. Now, as explained by a commentator, a contract of adhesion is one in which a party imposes a ready-made form of contract which the other party may accept or reject, but which the latter cannot modify. These are the contracts where all the terms are fixed by one party and the other has merely "to take it or leave it."
It is there admitted that these contracts usually contain a series of stipulations which tend to increase the obligations of the adherent, and to reduce the responsibilities of the offeror. There is such economic inequality between the parties to these contracts that the independence of one of them is entirely paralyzed. Yet, although other writers believe that there is no true contract in such cases because the will of one of the parties is suppressed, our commentator says that this is not juridically true. His view is that the one who adheres to the contract is in reality free to reject it entirely; if he adheres, he gives his consent.1
This conclusion would not seem to square with what this Court stated in Qua Chee Gan vs. Law Union and Rock Insurance Co., Ltd.2 It was there pointed out that by reason of the exclusive control by one party in a contract of adhesion over the terms and phraseology of the contract, any ambiguity must be held strictly against the one who caused it to be prepared and liberally in favor of the other party. In fact, this rule has since become a statutory provision.3
By analogy, these pronouncements in the aforestated case would inveigh against a rigid application of an exclusive venue stipulation where what is involved is a contract of adhesion, to wit:
"x x x The courts cannot ignore that nowadays monopolies, cartels and concentrations of capital, endowed with overwhelming economic power, manage to impose upon parties dealing with them cunningly prepared 'agreements' that the weaker party may not change one whit, his participation in the 'agreement' being reduced to the alternative to take it or leave it, labelled x x x 'contracts by adherence' (contracts d'adhesion), in contrast to those entered into by parties bargaining on an equal footing, such contracts x x x obviously call for greater strictness and vigilance on the part of courts of justice with a view to protecting the weaker party from abuses and imposition, and prevent their becoming traps for the unwa(r)y" (authorities omitted).
I respectfully submit, therefore, that while the enunciated rule on restrictive venue stipulations should ordinarily be respected, a greater caution on a case-to-case basis must be adopted by the courts where such stipulation is contained in a contract of adhesion. Not only should they consider the disadvantaged position of the adherent but, more importantly, the fact that the raison d'etre for rules of venue is to afford due process, greater convenience and more ready access to the court in favor of the adhering contracting party.
I also submit that the rule on restrictive venue stipulations should not apply where it would be violative of a settled and important policy of the State. Thus, for instance, in the cited case of Hongkong and Shanghai Banking Corporation vs. Sherman,4 aside from the agreement that the contract should be determined in accordance with the laws of Singapore, that contract also contained this provision: "We hereby agree that the Courts in Singapore shall have jurisdiction over all disputes arising under this guarantee x x x"
While it is true that in civil cases venue is a procedural, and not a jurisdictional, matter and the former may be the subject of stipulation, the quoted portion of the contract not only refers to the venue of prospective suits but actually trenches on the jurisdiction of our courts. Of course, in that case this Court did not enforce the quoted portion of the agreement but on the theory that a literal interpretation shows that the parties did not thereby stipulate that only the courts of Singapore, to the exclusion of all others, had jurisdiction. In other words, that agreement was not enforced because it was not a restrictive or mandatory provision.
Suppose, however, that stipulation had been couched in an exclusive and mandatory form? Since the ostensible venue aspect was interlinked with the jurisdiction of the foreign court, it would oust Philippine courts of jurisdiction and violate a fundamental national policy. Although in a different setting and on laws then obtaining but nonetheless upon a rationale applicable hereto, this Court has long declared as null and void any agreement which would deprive a court of its jurisdiction.5 In fact, the matter of the jurisdiction of courts cannot be the subject of a compromise.6 For that matter, the agreement in question, even on the issue of venue alone, would also greatly inconvenience the Philippine litigant or even altogether deny him access to the foreign court, for financial or other valid reasons, as to amount to denial of due process.
Exclusive jurisdiction of foreign courts over causes of action arising in the Philippines may be the subject of a treaty, international convention, or a statute permitting and implementing the same. Definitely, however, such jurisdiction and venue designation cannot and should not be conferred on a foreign court through a contractual stipulation even if restrictive in nature.
Footnotes
1 Tolentino, A., Civil Code of the Philippines, Vol. IV, 1987 ed., 503-504.
2 98 Phil. 85 (1955).
3 Art. 1377, Civil Code.
4 176 SCRA 331 (1989).
5 Molina vs. De la Riva, 6 Phil. 12 (1906).
6 Art. 2035 (5), Civil Code.
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