Facts:

collection of a sum of money

This case involves the proper invocation of the Construction Industry Arbitration
Committee's (CIAC) jurisdiction through an arbitration clause in a construction contract.
Spouses Rune and Lea Stroem (Spouses Stroem) entered into an Owners-Contractor
Agreement[4] with Asis-Leif & Company, Inc. (Asis-Leif) for the construction of a two-
storey house on the lot owned by Spouses Stroem.
Antipolo, Rizal
Asis-Leif secured Performance Bond No. LP/G(13)83056 in the amount of P4,500,000.00
from Stronghold Insurance Company, Inc. (Stronghold).
Stronghold and Asis-Leif, through Ms. Ma. Cynthia Asis-Leif,... bound themselves jointly
and severally to pay the Spouses Stroem the agreed amount in the event that the
construction project is not completed
Asis-Leif failed to finish the project on time despite repeated demands of the Spouses
Stroem
Spouses Stroem subsequently rescinded the agreement.
Appraiser Asian Appraisal Company, Inc.'s evaluation resulted in the following
percentage of completion
On April 5, 2001, Stronghold sent a letter to Asis-Leif requesting that the company settle
its obligations with the Spouses Stroem. No response was received from Asis-Leif.
Spouses Stroem filed a Complaint (with Prayer for Preliminary Attachment)[13] for breach
of contract and for sum of money with a claim for damages against Asis-Leif, Ms. Cynthia
Asis-Leif, and Stronghold.
Only Stronghold was served summons.
Regional Trial Court rendered a judgment in favor of the Spouses Stroem.
The trial court ordered Stronghold to pay the Spouses Stroem ?4,500,000.00 with 6%
legal interest from the time of first demand
Both Stronghold and the Spouses Stroem appealed to the Court of Appeals.
The Court of Appeals affirmed with modification the trial court's Decision. It increased the
amount of attorney's fees to ?50,000.00.
On March 20, 2013, this court required the Spouses Stroem to submit their Comment on
the Petition.
Stronghold argues that the trial court did not acquire jurisdiction over the case and,
therefore, the Court of Appeals committed reversible error when it upheld the Decision of
the Regional Trial Court... he lower courts should have dismissed the... case in view of
the arbitration clause in the agreement
Moreover, "the stipulations in said Agreement are part and parcel of the conditions in the
bond. Were it not for such stipulations in said agreement, [Stronghold] would not have
agreed to issue a bond in favor of the Spouses Stroem.
On the other hand, the Spouses Stroem argue that Stronghold committed forum shopping
warranting dismissal of the case.
According to the Spouses Stroem, Stronghold deliberately committed forum shopping
when it filed the present petition despite the... pendency of the Spouses Stroem's Motion
for Partial Reconsideration of the Court of Appeals Decision dated November 20, 2012.
Issues:
The main issue here is whether the dispute liability of a surety under a performance bond
is... connected to a construction contract and, therefore, falls under the exclusive
jurisdiction of the CIAC.
The issues for consideration are:
(1)
Whether the dispute involves a construction contract;
(2)
Whether the CIAC has exclusive jurisdiction over the controversy between the parties;
(3)
Whether the Regional Trial Court should have dismissed the petition outright as required
by law and jurisprudence and referred the matter to the CIAC; and
(4)
Whether petitioner Stronghold Insurance Company, Inc. is liable under Performance
Bond No. LP/G(13)83056.
(a)
Whether petitioner Stronghold Insurance Company, Inc. is only liable as to the extent of
any additional cost for the completion of the project due to any increase in prices for labor
and materials.
(b)
Whether the case involves ordinary suretyship or corporate suretyship.
On forum-shopping
On arbitration and the CIAC's jurisdiction
What is at issue in this case is the parties' agreement, or lack thereof, to submit the case
to arbitration. Respondents argue that petitioner is not a party to the arbitration
agreement. Petitioner did not consent to arbitration. It is only respondent and
Asis-Leif that may invoke the arbitration clause in the contract.
Ruling:
this court resolves to deny the Petition.
Records show that petitioner received a copy of the Decision of the Court of Appeals on
December 5, 2012.
Petitioner did not file a Motion for Reconsideration of the assailed Decision.
It filed before this court a Motion for Extension of
Time To File Petition for Review
Respondents filed their Motion for Partial Reconsideration of the Court of Appeals
Decision on December 11, 2012.
Respondents alleged in their Comment that as early as January 9, 2013, petitioner
received a copy of the Court of Appeals' Resolution requiring Comment on the Motion for
Partial Reconsideration... petitioner did not disclose in its
Verification and Certification Against Forum Shopping the pendency of respondents'
Motion for Partial Reconsideration.
Indeed, petitioner is guilty of forum shopping.
Petitioner failed to carry out its duty of promptly informing this court of any pending action
or proceeding before this court, the Court of Appeals, or any other tribunal or
agency. This court cannot countenance petitioner's disregard of the rules.
On this basis, this case should be dismissed
Petitioner... raised the issue of lack of jurisdiction in view of an arbitration agreement for
the first time.
Petitioner and respondents recognize that CIAC has jurisdiction over disputes arising
from the agreement.
This court, however, cannot apply the ruling in Prudential to the present case. Several
factors militate against petitioner's claim.
The contractual stipulations in this case and in Prudential are different
This court in Prudential held that the construction contract expressly incorporated the
performance bond into the contract.[79] In the present case, Article 7 of the Owners-
Contractor Agreement merely stated that a performance bond shall be... issued in favor
of respondents, in which case petitioner and Asis-Leif Builders and/or Ms. Ma. Cynthia
Asis-Leif shall pay P4,500,000.00 in the event that Asis-Leif fails to perform its duty under
the Owners-Contractor Agreement.
Consequently, the... performance bond merely referenced the contract entered into by
respondents and Asis-Leif, which pertained to Asis-Leif's duty to construct a two-storey
residence building with attic, pool, and landscaping over respondents' property
Owners-Contractor Agreement that the arbitration clause is found.
Not being a party to the construction agreement, petitioner cannot invoke the arbitration
clause. Petitioner, thus, cannot invoke the jurisdiction of the CIAC.
where a surety in a construction contract actively participates in a collection suit, it is
estopped from raising jurisdiction later.
Assuming that petitioner is privy to the construction agreement, we cannot allow petitioner
to invoke arbitration at this late... stage of the proceedings since to do so would go against
the law's goal of prompt resolution of cases in the construction industry.
petition is DEN
Principles:
There is forum shopping when:... as a result of an adverse opinion in one forum, a party
seeks a favorable opinion (other than by appeal or certiorari) in another. The principle
applies not only with respect to suits filed in the courts but also in connection with
litigations commenced in the... courts while an administrative proceeding is pending...
elements of forum-shopping: "(a) identity of parties, or at least such parties as represent
the same interests in both actions; (b) identity of rights asserted and reliefs prayed for,
the reliefs being founded on the same facts; and (c) the identity... with respect to the two
preceding particulars in the two cases is such that any judgment rendered in the pending
cases, regardless of which party is successful, amount to res judicata in the other case."
Rule 42, Section 2[45] in relation to Rule 45, Section 4 of the Rules of Court mandates
petitioner to submit a Certification Against Forum Shopping and promptly inform this court
about the pendency of any similar action or proceeding before other courts or...
tribunals. The rule's purpose is to deter the unethical practice of pursuing simultaneous
remedies in different forums, which "wreaks havoc upon orderly judicial
procedure."[46] Failure to comply with the rule is a sufficient ground for the... dismissal
of the petition... u]ltimately, what is truly important to consider in determining whether
forum-shopping exists or not is the vexation caused the courts and parties-litigant by a
party who asks different courts and/or administrative agencies to rule on the same or
related causes... and/or to grant the same or substantially the same reliefs, in the process
creating the possibility of conflicting decisions being rendered by the different fora upon
the same issue.
Generally, parties may not raise issues for the first time on appeal.[50] Such practice is
violative of the rules and due process and is frowned upon by the courts. However, it is
also well-settled that jurisdiction can never be waived or... acquired by
estoppel.[51] Jurisdiction is conferred by the Constitution or by law.[52] "Lack of
jurisdiction of the court over an action or the subject matter of an action cannot be cured
by the silence, by acquiescence, or... even by express consent of the parties.
In Heunghwa Industry Co., Ltd., v. DJ Builders Corporation,[55] this court held that "there
are two acts which may vest the CIAC with jurisdiction over a construction dispute. One
is the presence of an arbitration clause in a construction... contract, and the other is the
agreement by the parties to submit the dispute to the CIAC."... when a dispute arises from
a construction contract, the CIAC has exclusive and original jurisdiction.
This court has previously held that a performance bond, which is meant "to guarantee the
supply of labor, materials, tools, equipment, and necessary supervision to complete the
project[,]"[59] is significantly and substantially connected to the construction... contract
and, therefore, falls under the jurisdiction of the CIAC
Prudential Guarantee and Assurance Inc. v. Anscor Land, Inc.
Although not the construction contract itself, the performance bond is deemed as an
associate of the main construction contract that it cannot be separated or severed from
its principal. The Performance Bond is significantly and substantially connected to the...
construction contract that there can be no doubt it is the CIAC, under Section 4 of EO No.
1008, which has jurisdiction over any dispute arising from or connected with it.
It is settled that the surety's solidary obligation for the performance of the principal debtor's
obligation is indirect and merely secondary.[73] Nevertheless, the surety's liability to the
"creditor or promisee of the principal is said to be direct,... primary and absolute; in other
words, he is directly and equally bound with the principal.
'complementary-contracts-construed-together' doctrine... an accessory contract must be
read in its entirety and together with the principal agreement."
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