AMADO L. MENDOZA, PLAINTIFF-APPELLANT, VS. RODRIGUEZ & COMPANY, DOING BUSINESS UNDER THE STYLE AND TRADE NAME OF JOSEPH ENTERPRISES, DEFENDANT-APPELLEE.

Direct
appeal from an order of the Court of First Instance of Quezon dismissing
the above-entitled case, without costs.

The record shows that, on October 16, 1963, Joseph’s Enterprises – claiming to be a partnership
existing by virtue of the Philippine Laws – and Carmen G.
Rodriguez-Arguelles, Gregorio G. Rodriguez, Exaltacion
G. Rodriguez-Abadilla,
Alberto G. Rodriguez, and the Heirs of Pablo G. Rodriguez: namely, the minors Domiciano and Celestino Rodriguez
and Luz Rodriguez, as co-heir and guardian ad litem
of said minors, instituted Civil
Case No. 6642 of the Court of
First Instance of Quezon, against Amado A.
Mendoza.  It was alleged in the complaint
therein that plaintiffs signatures on a given document – purport – to be
an agreement between said plaintiffs and Mendoza, granting the latter, as
manager of the Sariaya Electric and Ice Plant, belonging to said partnership and the other plaintiffs, as the constituent
members of the partnership, the right “to certain onerous per­centage of the gross income of
plaintiffs’ business” – had been either forged by Mendoza or secured by
him through fraud or deceit.  Plaintiffs
prayed, therefore, that the supposed contract incorporated in said document be
declared “inexistent and null and void”, and that Mendoza be sentenced to
pay actual and moral damages.

In his answer^[1] to said complaint, Mendoza denied the personality to sue of Joseph’s
Enterprises, upon the ground that the same is merely a trade name of Rodriguez
& Co., which “is the owner and operator of Sariaya Electric and Ice Plant”.  He, likewise, denied the forgery or fraud
imputed to him, and alleged that the Rodrigueces had
knowingly given their approval to and signed the questioned document, copy of
which was attached to said answer as Annex 1, and that the complaint had been
filed for no other purpose than to harass him. 
Mendoza prayed, therefore, that the complaint be dismissed and that he
be awarded moral, exemplary and temperate damages, in addition to attorney’s
fees.

Months later, or on May 15, 1964, Mendoza commenced the present
action, Civil Case No. 6705 of the same court, against said Rodriguez &
Co., for the recovery of P3,360.59, 
alleged balance of the compensation that Mendoza claimed to be due to
him under the document sought to be annulled by Joseph’s Enterprises and the Rodrigueces in case No. 6642, “from April 14, 1948 up
to November 30, 1963, when he resigned”, according to his complaint, Copy
of said document was, also, attached to Mendoza’s complaint in case No. 6705,
as Annex A thereof.

In its answer to such
complaint, the defendant alleged, inter alia,
that “Joseph’s Enterprises is the partnership organized under
the laws of the Philippines, the name Rodriguez & Co. being another name
given the said partnership”, that having “prepared the articles of co-partnership
of the partnership known as Joseph Enterprises”, and acting maliciously,
surreptitiously and fraudulently, Mendoza presented Annex A, together with said
Articles of Co-partnership to the Rodrigueces, as if
the former were part of the latter; that the Rodriguezes
signed both instruments in such erroneous belief; and that they owe nothing to
Mendoza, who had never demanded payment of the balance alleged to be due to him
in his complaint.  Said defendant prayed,
therefore that the latter be dismissed, and that Mendoza be sentenced to pay damages and attorney’s fees, as
well as to render an accounting.

On motion of counsel for
Joseph’s Enterprises, dated July 25,
1964, based upon the allegation that
said cases Nos. 6642 and 6705 “involve the same parties, subject matter and
issues”, and “without objection” on the part of Mendoza’s
counsel”, on July 28, 1964, the lower court ordered the consolidation of
the hearing of the two (2) cases, “in view of the fact that they involve the
same parties, the same questions of fact and the same ques­tion of law”.

At said consolidated
hearing, plaintiffs in case No. 6642 (Joseph’s Enterprises, et al.), and the
defend­ant in case No. 6705 (Rodriguez & Co.), verbally moved, in open
court, for the dismissal of the latter case, alleging that the claim of
plaintiff therein (Mendoza) is based upon the very contract relied upon
in his answer in case No. 6642, and impugned by the plaintiffs therein; that,
accordingly, the balance of the compensation allegedly due to Mendoza under
said contract, should have been set up by him by way of compulsory counterclaim
in case No. 6642; and that, not
having done so, he is barred from claiming it in case No. 6705.

After due hearing and the
submission of Memoranda by both parties, said court issued the order appealed
from, the dispositive part of which reads:

“IN VIEW OF ALL THE FOREGOING, and taking into consideration
the reason behind Rule 9, Section 4, of the Rules of Court, the court finds
that the motion to dismiss filed by counsel
for Joseph Enterprises is tenable and meritorious, hence, Civil Case No. 6705
is hereby dismissed without pronouncement as to costs.”

A reconsideration of this
order having been denied, Mendoza interposed the present appeal by filing his
record on appeal in case No. 6705.  In his
brief, Mendoza alleges that the lower court erred:

1.  In holding that
plaintiffs in Civil Case No. 6642 have legal capacity to sue

2.  In holding that the act
of filing an answer by defendant (plaintiff-appellant) in Civil Case No. 6642 is a recognition of plaintiffs’
“personality and right” to sue.

3.  In holding that
plaintiff-appellant’s claim for unpaid compensation in Civil Case No. 6705
should be pleaded as compulsory counterclaim in his answer in Civil Case No. 6642.

4.  In holding that plaintiff-appellant
entered into a contract of services with Joseph Enterprises.

5.  In dismissing Civil
Case No. 6705.

The first assignment of error is clearly devoid of merit, for the
legal capacity of Joseph Enterprises to sue in Case No. 6642 is not
in issue in the present Case No. 6705. 
Moreover, the very document on which Mendoza’s alleged cause of action
and complaint therein are based and on which he signed after the words:
“accepted and to be enforced to the letter as agreed upon” –
states that said instrument had been
executed by “Pablo G. Rodriguez, Managing Partner of the JOSEPH’S
ENTERPRISES, a Partnership duly organized and existing under the laws of the
Philippines, x x x, by
virtue of the powers vested in me by
the ‘Indenture of the Articles
of General Partnership.’”  Pursuant to
the terms of this agreement, Mendoza‘s aforementioned contract had been made with
Joseph’s Enterprises, “a partnership duly organized and existing under the
Laws of the Philippines.” 
Hence, he is now in estoppel to question the
juridical personality of Joseph’s Enterprises or its right to sue him.  It is worthy of not notice in this connection
that, according to defendant’s answer in this case, said instrument was
prepared by none other than Mendoza himself, and that Mendoza has not made a
specific denial of such allegation.

As regards the second
assignment of error, suffice it to say that, even if his answer
in Case No. 6642 had not implied an acknowledgment of Joseph’s
Enterprises ac a duly registered partnership, with juridical personality to
sue, the fact is that by his acts – in drafting the document in
question and signing the same, as well in takings advantage of the benefits
derived therefrom and filing the complaint herein
based thereon – he had
recognized said personality and profited therefrom,
and is, accordingly, in estoppel to deny the same.

The third and fourth
assignments of error are predicated upon the theory that Mendoza’s contract was entered intro with Rodriguez & Co., not with Joseph’s
Enterprises.  This pretense is refuted, however, by the language the instruments incorporation said
alleged contract.  More significant still
is ‘the facet that, whereas Joseph’s Enterprises and the Rodrigueces
alleged that their signature thereon had been fraudulently obtained and that
they had no intention of binding themselves to pay Mendoza the compensation
therein set forth; Mendoza maintains that the document reflects
the true of the parties thereto.  How
can he now take, therefore, a position inconsistent with the
provisions hereof?

In any event, the
question whether or note Joseph’s Enterprise is merely a trade name of the
partnership, Rodriguez & Co., is not important in this appeal, for even if Mendoza’s contention were hypothetically true his claim in the case at bar for
unpaid compensation allegedly due under the contract in question would still he
and is necessarily connected with the transaction that is the subject-matter of
Case No. 6642, and, not having been set up in that case it
is barred from enforcement in the present subsequent case, pursuant to Rule 9,
Section 4, of the Rules of Court.^[2]

We need not discuss the last assignment of error, it being a mere
corollary to the assignments of error already disposed of.

WHEREFORE, the order appealed from is hereby affirmed,
with the costs of this instance against
plaintiff-appellant Amado L. Mendoza.

Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Sanchez,
Castro, and Angeles, JJ.,
concur.

^[1]
Filed on January 24, 1964.

^[2]
“SEC. 4.  Counterclaim or Cross-Claim Not Set Up Barred.  – A
counterclaim or cross-claim no set up shall be barred if it arises out of or is
necessarily connected with, the transaction or occurrence that is the subject-matter of the opposing party’s or co-party’s claim and does not require for its adjudication the presence of third parties
or whom the court cannot acquire
jurisdiction.”