UNIVERSAL INSURANCE AND INDEMNITY COMPANY, PETITIONER-APPELLANT, VS. THE HON. ROMAN CANSINO, JR., AND AGE CONSTRUCTION CO., INC., RESPONDENTS-APPELLEES.

Appellant Universal Insurance and Indemnity Company went to the
Court of First Instance of Manila on a petition
for prohibition (Civil Case No. 59607) to stop the respondent Judge, the late
Hon. Roman Cansino, Jr., presiding Branch VIII, City
Court of Manila, from further taking cognizance of Civil Case No. 111904
insofar as said petitioner, one of the defendants therein, was
concerned.

Civil Case No. 111904 is entitled “Age Construction Co.,
Inc., Plaintiff, vs. Beatriz Tengsico and Husband,
and Universal Insurance and Indemnity Company, Defendants.”

The pertinent facts are as follows:  Age Construction Co., Inc. – hereinafter
referred to as the respondent company – is a domestic corporation engaged in
the construction business.  On January 24, 1962 it entered into a
written contract with Beatriz Tengsico, leasing to the latter several units of
construction equipment, one of which was a vibrator stipulated to be worth not
less than P500.00, at a monthly rental in the same amount.  The lease contract was executed in the City
of Manila and provided that the equipment subject
thereof was to be used on a construction project of the lessee and returned to
the lessor upon termina­tion of the lease in the same
good running condition as when it was received. 
The lessee also undertook to insure the equipment against loss, damage
or destruction, the corresponding insurance policy to be issued in favor of the
lesson.

On January 26, 1962
the policy was issued by the petitioner, with the respondent company appearing
as the assured and with the place of execution indicated as follows:  “IN WITNESS WHEREOF, a duly authorized officer of the
(insurance) company has set his hand here­under in Makati, Rizal, Philippines,
this 26th day of January 1962.”

In due time the
construction project of the lessee was finished and the respondent company
asked for the return of the leased equipment.  The vibrator, however, was not returned, the lessee alleging that it had been lost and
that she had a certificate of loss in her posses­sion.  So the respondent company filed Civil Case
No. 111904 in the City Court of Manila against Beatriz Tengsico
and her husband for the recovery of the value of the vibrator and actual
damages equivalent to the monthly rentals, as well as for moral and exemplary
damages.  The date of the filing of the
complaint does not appear in the record before us.  What does appear is that an amended complaint
dated October 2, 1964 was subsequently filed pursuant to an order of the respondent
Judge, impleading the herein petitioner as
alternative party defendant in view of the allegation of the Tengsicos in their answer to the original complaint that
the vibrator had been insured with the petitioner and that the same had been
lost in their posses­sion.

The allegation in the amended complaint with respect to the new
defendant, petitioner herein, is that sometime in December 1962 the plaintiff
verbally requested the said defendant to pay the insurance value of the
vibrator and followed such verbal request with a formal letter of demand on February 26, 1964, but that the
demand was not complied with.  The
specific prayer against the same defendant is for judgment in the alternative
to be rendered against it for the payment of the sum of P6,000.00,
which is the aggregate insured value of the three items of equipment covered by
the insurance policy.

On November 4, 1964
the petitioner filed a motion to dismiss the amended complaint insofar as it
was concerned on the grounds:  (1) that
venue was improperly laid; (2) that the complaint failed to state a cause of action; and (3) that the
plaintiff’s claim set forth in the complaint had been waived or abandoned and
had already prescribed.  The motion was denied; the petitioner moved
to reconsider but was turned down; and the case was set for trial on January 26, 1965.

The petition for prohibition, Case No. 59607, was thereupon
commenced in the Court of First Instance of Manila seeking to stop the
respondent Judge from further proceeding with Civil Case No. 111904, and
alleging that the denial by him of the petitioner’s motion to dismiss was
without or in excess of jurisdiction and a
grave abuse of discretion.

On July 9, 1965
the Court of First Instance rendered judgment sustaining the order of the
respondent Judge and dismissing the petition for prohibition.  Hence this appeal.

The only issue raised before Us is whether
or not venue was properly laid in Civil Case No. 111904 as against
the herein petitioner.  It should be
stated that the original complaint filed by the respondent company in the City
Court of Manila was against the Tengsicos alone for
the recovery of the value of the vibrator which had been leased to Beatriz Tengsico and which they failed to return upon the
termination of the lease.  In other
words, the action was predicated on the lease contract, for breach of a stipu­lation
therein.  That action could be tried and proceed to judgment without bringing
in the petitioner as defendant, the latter not being a party to the said
contract, and its liability, if any, being based on the insurance policy it had
issued.  In fact, the prayer in the
amended complaint is merely to hold it alternatively responsible.  It is clear, therefore, that the petitioner is not an
indispensable party in the action filed against the original defendants, since
without its joinder a final determination of said action could be obtained.

If anything the
petitioner was only a proper or necessary party within the meaning of Section 8
of Rule 3, which provides as follows:

“SEC. 8.  Joinder of proper
parties.- When persons who are not indispensable but
who ought to be parties if complete relief is to be accorded as between those
already parties have not been made parties and are subject to the jurisdiction of the court as to both service of process and venue, the
court shall order them sum­moned to appear in the action.  But the court may, in its discretion, proceed
in the action without making such per­sons parties, and the judgment rendered
therein shall be without prejudice to the rights of such persons.”

It is to be noted that under the foregoing rule the joinder of proper parties, that is, of persons who are not
indispensable but who ought to be parties if complete relief is to be afforded
as between those already parties, requires that they be subject to the
jurisdiction of the court as to both service of process and venue.

In the instant case there is no agreement in the insurance policy
issued by the petitioner as to where an action for recovery thereon should be
filed.  Consequent­ly, Rule 4, Section
1(b), subparagraph 2, should govern, to wit: 
“All other civil actions (i.e., actions other than forcible entry
and detainer) in inferior courts should be
brought:  if there is no such agreement,
in the place of execution of the contract sued upon as appears there
from.”

The place of execution is clear enough
on the face of the policy:  it was Makati, Rizal.  Any evidence to show otherwise would be
immaterial, since the purpose of the rule is to avoid further inquiry outside
that which appears on the document itself as the place of execution.  Further­more, to permit such inquiry would be
to assume that the contract does not show where it was executed, in which case
subparagraph 3 of the same Rule 4 would be applicable, to the effect that
action should be brought “in the municipali­ty where the defendant or any
of the defendants resides or may be served with summons.” In this case it
is alleged in the amended complaint that “the Universal Insurance and
Indemnity Company, Inc. is a corporation organized under the laws of the Philippines,
with postal address at Insular Life
Building, Ayala
Avenue, Makati,
Rizal,” and it was in Makati, Rizal
that it was served with summons.

In the case of Enriquez v. Macaraeg, 84 Phil. 674, this Court held that prohibition is
the proper remedy against a Judge who proceeds “in defiance of the Rules
of Court by refusing to dismiss an action which could not be maintained in his
court” on the ground of improper venue.

Wherefore, the judgment appealed
from is hereby reversed and the writ prayed for is ordered issued, pro­hibiting whoever is the successor of the
respondent Judge, Hon. Roman Cansino, Jr., now
deceased, from further proceeding in Civil
Case No. 111904 of the City Court of Manila insofar as the petitioner,
defendant therein, is concerned.   Costs against the private
respondent.

Concepcion, C.J., Reyes, J.B.L., Zaldivar,
Castro, Fernando, Teehankee, Barredo, Villamor, and
Makasiar, JJ., concur.