PBCOM VS.

LIM AND CALDERON

GR. No. 158138
April 12, 2005
FACTS: PBCom filed a complaint against respondents in the RTC
of Manilafor the collection of a deficiency. Petitioner alleged therein
that respondents obtained a loan from it and executed a continuing
surety agreement in favor of petitioner for all loans, credits, etc that
were extended or may be extended in the future to respondents.
Petitioner granted a renewal of said loan upon respondents request. It
was expressly stipulated threrein that the venue for any legal
action that may arise out of said promissory note shall
be Makati City, to the exclusion of all other
courts Respondents allegedly failed to pay said obligation upon
maturity. Thus, petitioner foreclosed the real estate mortgage executed
by respondents, leaving a deficiency balance.
Respondents moved to dismiss the complaint on the ground of improper
venue, invoking the stipulation contained in the last
paragraph of the promissory note with respect to the
restrictive/exclusive venue.
The trial court denied said motion asseverating that petitioner
had separatecauses of action arising from the promissory
note and the continuing surety agreement. Thus, [under] Rule 4,
Section 2, of the 1997 Rules of Civil Procedure, as amended, x x

x venue was properly laid in Manila. An MR of said order was

likewise denied.
On appeal, the CA ruled that respondents alleged debt was based on the
Promissory Note, which had provided an exclusionary stipulation on
venue to the exclusion of all other courts. The parties Surety
Agreement, though silent as to venue, was an accessory contract that
should have been interpreted in consonance with the Promissory Note.
Hence, this Petition
ISSUE: WON the action against the sureties is covered by the
restriction on venue stipulated in the PN
HELD: WHEREFORE, the Petition is DENIED and the assailed
Decision AFFIRMED.
YES; Since the cases pertaining to both causes of action are restricted to
Makati City as the proper venue, petitioner cannot rely on Section 5 of
Rule 2 of the Rules of Court.
**
Section 2 of Rule 4 of the ROC provides that personal actions must be
commenced and tried
(1) in the place where the plaintiff resides, or
(2) where the defendant resides, or
(3) in case of non-resident defendants, where they may be found, at the
choice of the plaintiff.

This rule on venue does not apply when the law specifically provides
otherwise, or when before the filing of the action the
contracting parties agree in writing on the exclusive
venue thereof. Venue is not jurisdictional and may be waived by the
parties. A stipulation as to venue does not preclude the filing of the
action in other places, unless qualifying or restrictive words are used in
the agreement.
**
In enforcing a surety contract, the complementary-contractsconstrued-together doctrine finds application. According to this
principle, an accessory contract must be read in its entirety and together
with the principal agreement[ This principle is used in construing
contractual stipulations in order to arrive at their true meaning; certain
stipulations cannot be segregated and then made to control. This nosegregation principle is based on Article 1374 of the Civil Code, which
we quote:
Art. 1374. The various stipulations of a contract shall be interpreted
together, attributing to the doubtful ones that sense which may result
from all of them taken jointly.
The aforementioned doctrine is applicable to the present case. Incapable
of standing by itself, the SA can be enforced only in conjunction with the
PN. The latter documents the debt that is sought to be collected in the
action against the sureties. The circumstances that related to the
issuance of the PN and the SA are so intertwined that neither one could

be separated from the other. It makes no sense to argue that the parties
to the SA were not bound by the stipulations in the PN.
NOTES:
A cause of action is a partys act or omission that violates the rights of
the other. Only one suit may be commenced for a single cause of
action. If two or more suits are instituted on the basis of the same cause
of action, only one case should remain and the others must be
dismissed.