TUNA PROCESSING, INC., Petitioner, vs. PHILIPPINE KINGFORD, INC., Respondent. D E C I S I O N JUSTICE JOSE PORTUGAL PEREZ

FACTS:
Can a foreign corporation not licensed to do business in the Philippines, but which collects royalties from entities in the Philippines, sue here to enforce a foreign arbitral award? In this Petition for Review on Certiorari under Rule 45, petitioner Tuna Processing, Inc. (TPI), a foreign corporation not licensed to do business in the Philippines, prays that the Resolution dated 21 November 2008 of the Regional Trial Court (RTC) of Makati City be declared void and the case be remanded to the RTC for further proceedings. In the assailed Resolution, the RTC dismissed petitioner’s Petition for Confirmation, Recognition, and Enforcement of Foreign Arbitral Award against respondent Philippine Kingford, Inc. (Kingford), a corporation duly organized and existing under the laws of the Philippines, on the ground that petitioner lacked legal capacity to sue. Kanemitsu Yamaoka (hereinafter referred to as the "licensor"), co- patentee of U.S. Patent No. 5,484,619, Philippine Letters Patent No. 31138, and Indonesian Patent No. ID0003911 (collectively referred to as the "Yamaoka Patent"), and five 5 Philippine tuna processors, namely, Angel Seafood Corporation, East Asia Fish Co., Inc., Mommy Gina Tuna Resources, Santa Cruz Seafoods, Inc., and respondent Kingford (collectively referred to as the "sponsors"/"licensees") entered into a Memorandum of Agreement. Due to a series of events not mentioned in the petition, the licensees, including respondent Kingford, withdrew from petitioner TPI and correspondingly reneged on their obligations. Petitioner submitted the dispute for arbitration before the International Centre for Dispute Resolution in the State of California, United States and won the case against respondent. To enforce the award, petitioner TPI filed a Petition for Confirmation, Recognition, and Enforcement of Foreign Arbitral Award before the RTC of Makati City. The RTC granted the respondent’s Motion for Reconsideration and dismissed the petition on the ground that the petitioner lacked legal capacity to sue in the Philippines. Petitioner TPI now seeks to nullify, in this instant Petition for Review on Certiorari under Rule 45, the order of the trial court dismissing its Petition for Confirmation, Recognition, and Enforcement of Foreign Arbitral Award.

Issue:
​The core issue in this case is whether or not the court a quo was correct in so dismissing the petition on the ground of petitioner’s lack of legal capacity to sue.

Held:
The petition is impressed with merit. The Corporation Code of the Philippines expressly provides: Sec. 133. Doing business without a license. - No foreign corporation transacting business in the Philippines without a license, or its successors or assigns, shall be permitted to maintain or intervene in any action, suit or proceeding in any court or administrative agency of the Philippines; but such corporation may be sued or proceeded against before Philippine courts or administrative tribunals on any valid cause of action recognized under Philippine laws. It is pursuant to the aforequoted provision that the court a quo dismissed the petition. The petitioner counters, however, that it is entitled to seek for the recognition and enforcement of the subject foreign arbitral award in accordance with Republic Act No. 9285 (Alternative Dispute Resolution Act of 2004), the Convention on the Recognition and Enforcement of Foreign Arbitral Awards drafted during the United Nations Conference on International Commercial Arbitration in 1958 (New York Convention), and the UNCITRAL Model Law on International Commercial Arbitration (Model Law), as none of these specifically requires that the party seeking for the enforcement should have legal capacity to sue. It anchors its argument on the following: Simply put, how do we reconcile the provisions of the Corporation Code of the Philippines on one hand, and the Alternative Dispute Resolution Act of 2004, the New York Convention and the Model Law on the other? In several cases, this Court had the occasion to discuss the nature and applicability of the Corporation Code of the Philippines, a general law, viz-a-viz other special laws. Thus, in Koruga v. Arcenas, Jr.,25 this Court rejected the application of the Corporation Code and applied the New Central Bank Act. It ratiocinated: Koruga’s invocation of the provisions of the Corporation Code is misplaced. In an earlier case with similar antecedents, we ruled that: "The Corporation Code, however, is a general law applying to all types of corporations, while the New Central Bank Act regulates specifically banks and other financial institutions, including the dissolution and liquidation thereof. As between a general and special law, the latter shall prevail – generalia specialibus non derogant." (Emphasis supplied) Further, in the recent case of Hacienda Luisita, Incorporated v. Presidential Agrarian Reform Council, this Court held: Without doubt, the Corporation Code is the general law providing for the formation, organization and regulation of private corporations. On the other hand, RA 6657 is the special law on agrarian reform. As between a general and special law, the latter shall prevail—generalia specialibus non derogant. Following the same principle, the Alternative Dispute Resolution Act of 2004 shall apply in this case as the Act, as its title - An Act to Institutionalize the Use of an Alternative Dispute Resolution System in the Philippines and to Establish the Office for Alternative Dispute Resolution, and for Other Purposes - would suggest, is a law especially enacted "to actively promote party autonomy in the resolution of disputes or the freedom of the party to make their own arrangements to resolve their disputes."29 It specifically provides exclusive grounds available to the party opposing an application for recognition and enforcement of the arbitral award. Inasmuch as the Alternative Dispute Resolution Act of 2004, a municipal law, applies in the instant petition, we do not see the need to discuss compliance with international obligations under the New York Convention and the Model Law. After all, both already form part of the law. {Doctrine of Incorporation as enshrined in our Constitution}

​WHEREFORE, the Resolution dated 21 November 2008 of the Regional Trial Court, Branch 61, Makati City in Special Proceedings No. M-6533 is hereby REVERSED and SET ASIDE. The case is REMANDED to Branch 61 for further proceedings. SO ORDERED.