Ang vs. Ang

Where the plaintiff is a non-resident of the Philippines, the action may only be filed in the court of the place where the defendant resides; the residence of the plaintiff's attorney-in-fact is immaterial for determining venue because the attorney-in-fact is not a real party in interest.

Spouses Alan and Em Ang obtained a US$300,000.00 loan from spouses Theodore and Nancy Ang in 1992, executing a promissory note with a 10% annual interest rate payable upon demand. Following repeated demands, the debt remained unpaid, accumulating to over US$700,000.00 by 2006.

• The Loan: In 1992, respondents borrowed US$300,000.00 from petitioners, executing a promissory note with 10% per annum interest payable on demand.
• Default and Demand: Respondents failed to pay despite repeated demands. By August 28, 2006, the outstanding debt amounted to US$719,671.23, inclusive of accumulated interest.
• The Complaint: Petitioners, residing in Los Angeles, California, USA, executed Special Powers of Attorney in favor of Atty. Eldrige Marvin B. Aceron, a resident of Quezon City, to file the action. On September 15, 2006, Atty. Aceron filed a complaint for collection of sum of money against respondents in the RTC of Quezon City.
• Motion to Dismiss: Respondents moved to dismiss on grounds of improper venue and prescription, asserting that since they reside in Bacolod City and petitioners in the USA, Quezon City was an improper venue.

• Venue Based on Attorney-in-Fact: Petitioners argued that the complaint was properly filed in Quezon City because Atty. Aceron, as their attorney-in-fact, is deemed a real party in interest under Section 3, Rule 3 of the Rules of Court; thus, his residence determines the proper venue.

• Improper Venue: Respondents countered that under Section 2, Rule 4 of the Rules of Court, the complaint may only be filed where the plaintiffs or defendants reside. Since petitioners reside in the USA and respondents in Bacolod City, Quezon City is an improper venue.
• Attorney-in-Fact is Not a Real Party in Interest: Respondents maintained that Atty. Aceron is merely a representative and not the real party in interest; consequently, his residence is immaterial to the determination of venue.

• Venue of Personal Actions: Whether a complaint filed by a non-resident plaintiff through an attorney-in-fact may be laid in the court of the place where the attorney-in-fact resides.
• Real Party in Interest: Whether an attorney-in-fact constitutes a real party in interest whose residence determines venue.

• Venue of Personal Actions: The complaint must be filed where the defendant resides because the plaintiff is a non-resident. A non-resident plaintiff has no election of venue and cannot file the action where the attorney-in-fact resides. Venue rules are designed for the convenience of the parties and witnesses, and allowing a plaintiff to choose the residence of their attorney-in-fact as venue would unduly deprive a resident defendant of their procedural rights.
• Real Party in Interest: An attorney-in-fact is not a real party in interest. A real party in interest is the party who stands to be benefited or injured by the judgment. Because the attorney-in-fact was appointed merely for the limited purpose of filing and prosecuting the complaint and does not stand to be benefited or injured by the judgment, he is not subrogated into the rights of the petitioners. Section 3, Rule 3 of the Rules of Court designates the beneficiary, not the representative, as the real party in interest.

• Real Party in Interest — Defined as the party who stands to be benefited or injured by the judgment in the suit, or the party entitled to the avails of the suit. Interest means material interest, distinguished from mere curiosity. An attorney-in-fact appointed for the limited purpose of prosecuting a claim is not a real party in interest because the right sought to be enforced belongs to the principal, and the attorney-in-fact does not stand to be benefited or injured by the judgment.
• Venue of Personal Actions for Non-Resident Plaintiffs — If the plaintiff does not reside in the Philippines, the complaint may only be filed in the court of the place where the defendant resides. There can be no election of venue by a non-resident plaintiff.

• "Only one of the parties to the action resides here. There can be, therefore, no election by plaintiff as to the place of trial. It must be in the province where the defendant resides." — Quoting Cohen and Cohen v. Benguet Commercial Co., Ltd., establishing the rule on venue for non-resident plaintiffs.
• "Interest within the meaning of the Rules of Court means material interest or an interest in issue to be affected by the decree or judgment of the case, as distinguished from mere curiosity about the question involved." — Defining the requisite interest for a real party in interest.

• Cohen and Cohen v. Benguet Commercial Co., Ltd., 34 Phil. 526 (1916) — Controlling precedent establishing that a non-resident plaintiff has no election of venue and must file the action where the defendant resides.
• Filipinas Industrial Corp. v. Hon. San Diego, 132 Phil. 195 (1968) — Followed in holding that an attorney-in-fact is not a real party in interest.
• Pascual v. Pascual, 511 Phil. 700 (2005) — Followed in construing the requirement of residence under venue rules vis-à-vis the definition of a real party in interest.

• Section 2, Rule 3, Rules of Court — Defines a real party in interest. Applied to rule that Atty. Aceron, who does not stand to benefit or be injured by the suit, is not a real party in interest.
• Section 3, Rule 3, Rules of Court — Provides that in actions prosecuted by a representative, the beneficiary shall be deemed the real party in interest. Applied to clarify that the representative (attorney-in-fact) is not the real party in interest; the principal is.
• Section 2, Rule 4, Rules of Court — Governs the venue of personal actions. Applied to mandate that since petitioners are non-residents, venue lies exclusively where the defendant resides (Bacolod City), not where the attorney-in-fact resides (Quezon City).

Antonio T. Carpio (Chairperson), Presbitero J. Velasco, Jr., Teresita J. Leonardo-De Castro, Jose Portugal Perez.