Grounds to dismiss (Rule 16) – Forum shopping, litis pendentia, and res judicata

G.R. No. 197530 – Aboitiz v. Chiongbian (July 9, 2014)

Leonen, J.

ASC, CAGLI, and WLI agreed to pool their resources and merge businesses under WG&A. Their
agreement stipulated arbitration as a means of settling disputes. CAGLI gave more than what
was stipulated, but the excess was returned. Later on, CAGLI claimed that the excess was not
yet returned. AEV acquired the shares of ASC and WLI and renamed the business to ATSC. CAGLI
filed an application for arbitration with RTC-Cebu against Chiongbian, ATSC, ASC, and AEV for
the return of the excess inventories. AEV filed a MTD arguing that there was no cause of action
against it as there was no agreement to arbitrate between CAGLI and AEV. RTC discharged AEV
and ordered the other parties to proceed with arbitration. CAGLI filed another application for
arbitration in view of the return of the same excess inventories. AEV filed an MTD on the
grounds of forum shopping, failure to state cause of action, res judicata, and litis pendentia. RTC
denied MTD and subsequent MR hence this petition to the SC. SC ruled that there was no
agreement binding AEV and CAGLI to arbitrate. Also, CAGLI engaged in forum shopping and the
second complaint was barred by res judicata, but not by litis pendentia.