MANILA RAILROAD COMPANY AND MANILA PORT SERVICE, PETITIONERS, VS. THE HON. CARMELINO G. ALVENDIA, JUDGE, COURT OF FIRST INSTANCE OF MANILA, THE HON. ESTRELLA ABAD SANTOS, JUDGE,…

Manila Railroad versus Alvendia

The Case

This is a petition for certiorari and mandamus with preliminary injunction filed by the Manila Railroad Company and the Manila Port Service against Judge Carmelino Alvendia of the Court of First Instance of Manila. The petitioners ask the Supreme Court to compel the respondent judge to approve and remit the record on appeal from his decision of September 18, 1964, which had dismissed their appeal on a purely procedural ground. The case matters because it settles a question of procedural law that recurs in practice: whether an appeal bond filed in the name of an entity that is not a separate juridical person, but is in truth a part of the appellant corporation, validly perfects the appeal. It is a case about the identity of the appellant and the sufficiency of an appeal bond, not about the merits of the arrastre claim.

Procedural History

The original action was filed by the Empire Insurance Company, as subrogee of the consignees, in the City Court of Manila, to recover sums for short deliveries of shipments of flavored ovaltine. The City Court rendered judgment against the Manila Railroad Company. The Manila Railroad Company appealed to the Court of First Instance of Manila, but the appeal bond was filed by the Manila Port Service.

In the Court of First Instance, the complaint was reproduced, and both the Manila Railroad Company and the Manila Port Service filed answers as defendants. The parties then entered into stipulations of facts in which the Manila Port Service was referred to as a defendant. On September 18, 1964, the Court of First Instance dismissed the appeal without resolving the merits, solely on the ground that the only defendant before the inferior court was the Manila Railroad Company, and the appeal bond having been filed not by it but by the Manila Port Service, which was not a party therein, no appeal was duly perfected.

An appeal from that decision was again sought, and again the Manila Port Service posted the appeal bond. For the same reason, the appeal was refused. The petitioners then resorted to the Supreme Court by petition for certiorari and mandamus with preliminary injunction to compel the respondent judge to approve and remit the appeal from his decision of September 18, 1964.

Facts

The Empire Insurance Company, as subrogee of the consignees P. Austria and Company, Incorporated and Apisa and Company, Incorporated, filed suit on May 24, 1963 in the City Court of Manila. It sought to recover the sums of 186 pesos and 990 pesos and 48 centavos, plus attorney's fees of 100 pesos and 500 pesos, respectively, on two alleged causes of action involving short deliveries of shipments of flavored ovaltine. The defendant sued was the Manila Railroad Company, for transactions had with, and acts performed through, its agent and subsidiary, the Manila Port Service, which then handled arrastre operations in the port of Manila.

The City Court rendered judgment against the Manila Railroad Company. The Manila Railroad Company appealed to the Court of First Instance of Manila, but the appeal bond was filed by the Manila Port Service. In the Court of First Instance, the complaint was reproduced, and both the Manila Railroad Company and the Manila Port Service filed answers as defendants. The parties then entered into stipulations of facts in which the Manila Port Service was referred to as a defendant in the suit.

On September 18, 1964, the Court of First Instance dismissed the appeal without resolving the merits. Its sole ground was that the only defendant before the inferior court was the Manila Railroad Company, and since the appeal bond was filed not by it but by the Manila Port Service, which was not a party therein, no appeal was duly perfected. When an appeal from that decision was sought, the Manila Port Service again posted the appeal bond, and the appeal was again refused for the same reason.

Issues

• Whether or not the Manila Port Service, having litigated in the Court of First Instance as a defendant and having been recognized as such in the stipulations of facts, was a party to the case.
• Whether or not the Manila Port Service, not having a separate juridical personality from the Manila Railroad Company, validly perfected the appeal when it filed the appeal bond in its own name.
• Whether or not the respondent judge should be ordered to render a decision upon the merits of the case instead of dismissing the appeal on the ground that no appeal was duly perfected.

Applicable Provisions

The decision does not quote any statutory provision. Its reasoning rests on the procedural rule governing the perfection of appeals and on the principle that an entity without a separate juridical personality is not a distinct party. The Court's own formulation of that principle is quoted in the Ruling below.

Ruling

On the first issue, the Court held that the record clearly shows that the Manila Port Service litigated in the Court of First Instance as a defendant. It filed an answer as such, and the parties recognized its status as a defendant in the two stipulations of facts entered into. It freely submitted itself to the court's jurisdiction, with the subsequent express acquiescence of the plaintiff.

On the second issue, the Court rejected the plaintiff's position that there is no showing that the Manila Port Service has legal personality or is a juridical person which could be a party in a civil action. The Court turned that very objection against the plaintiff. Precisely for this reason, the Manila Port Service must be deemed part of the Manila Railroad Company, not a separate entity, in a suit against the latter based on arrastre operations undertaken by it through its agent and subsidiary, the Manila Port Service. The Court stated the rule thus:

Not having a separate juridical personality from the Manila Railroad Co., its filing of an appeal bond is perforce an act of the Manila Railroad Co., not that of a separate and different person.

On the third issue, the Court held that since the appeal from the decision of September 18, 1964 would raise the same point already resolved, the appeal becomes unnecessary. The respondent judge should therefore be ordered to render a decision upon the merits in the case in question.

Doctrine

An entity that has no separate juridical personality from a corporation is not a distinct person in law. When such an entity files an appeal bond in a suit against the corporation, the filing is perforce an act of the corporation itself, and the appeal is validly perfected. A party who itself asserts that the entity lacks legal personality cannot later use that lack of personality to defeat the appeal, because the assertion confirms that the entity and the corporation are one and the same. An entity that litigates as a defendant, files an answer as such, and is recognized as a defendant in stipulations of facts freely submits itself to the court's jurisdiction, with the acquiescence of the plaintiff. Where the only obstacle to the appeal is a procedural point already resolved by the Supreme Court, the appellate court should be ordered to decide the case on the merits rather than dismiss the appeal.

Disposition

The petition was granted. The respondent judge's decision of September 18, 1964 was set aside, and the Court of First Instance of Manila was ordered to decide the civil case on the merits, with no costs.

Remember This

The single line worth memorizing is that an appeal bond filed by an entity without separate juridical personality is perforce an act of the corporation itself, not of a separate and different person. Examiners use this case to test the identity of the appellant in appeals from inferior courts and the effect of a party's own admission that an entity lacks legal personality.