The Supreme Court clarified the application of the “two-dismissal rule” under Rule 17, Section 1 of the Rules of Civil Procedure, emphasizing that it applies only when the plaintiff initiates both dismissals. This means that if a prior dismissal was due to the defendant’s motion, the rule does not bar the plaintiff from re-filing the case after voluntarily dismissing it a second time. The Court also addressed the issue of forum shopping, cautioning against filing multiple cases simultaneously to seek a favorable outcome, which can lead to the dismissal of all related actions.

When Family Feuds Lead to Forum Shopping: Unpacking the Two-Dismissal Rule

The case of Ramon Ching and Po Wing Properties, Inc. v. Joseph Cheng, et al. revolves around a complex family dispute concerning the estate of Antonio Ching. The legal question at its heart is whether the dismissal of two prior cases, under specific circumstances, prevents the plaintiffs from pursuing a third case involving the same claims.

The factual backdrop involves allegations of illegitimate children, disputed inheritances, and accusations of murder. Antonio Ching’s alleged heirs, including Ramon Ching, Joseph Cheng, Jaime Cheng, Mercedes Igne, and Lucina Santos, engaged in a series of legal battles over his substantial estate. These disputes led to multiple filings and dismissals, eventually bringing into question the application of the “two-dismissal rule” and the prohibition against forum shopping. The legal intricacies of this case lie in determining whether the prior dismissals were indeed initiated by the plaintiffs and whether the filing of a subsequent case while a motion for reconsideration was pending constituted an abuse of court processes.

The Supreme Court meticulously dissected the procedural history of the case, focusing on the dismissals of Civil Case No. 98-91046 (the first case) and Civil Case No. 02-103319 (the second case). The “two-dismissal rule,” enshrined in Rule 17, Section 1 of the 1997 Rules of Civil Procedure, states that a notice of dismissal operates as an adjudication on the merits when filed by a plaintiff who has previously dismissed an action based on the same claim. However, this rule only applies when both dismissals are initiated by the plaintiff. The Court emphasized that dismissals upon the instance of the defendant are generally governed by Rule 16, which covers motions to dismiss.

RULE 17
DISMISSAL OF ACTIONS

SEC. 1. Dismissal upon notice by plaintiff. — A complaint may be dismissed by the plaintiff by filing a notice of dismissal at any time before service of the answer or of a motion for summary judgment. Upon such notice being filed, the court shall issue an order confirming the dismissal. Unless otherwise stated in the notice, the dismissal is without prejudice, except that a notice operates as an adjudication upon the merits when filed by a plaintiff who has once dismissed in a competent court an action based on or including the same claim.

In this case, the first dismissal occurred due to a motion filed by the defendants, arguing that the amended complaint included causes of action that should have been adjudicated in a special proceeding, thus challenging the court’s jurisdiction. The trial court granted this motion. The Court clarified that since the dismissal was at the defendant’s instance, it did not count as one of the dismissals contemplated by the “two-dismissal rule.” The subsequent dismissal of the second case, initiated by the plaintiffs before any responsive pleadings were filed, was therefore considered the first dismissal at the plaintiff’s instance, making it without prejudice.

The petitioners argued that the failure to file an amended complaint in the first case after the dismissal should be considered a dismissal on the merits, thereby triggering the “two-dismissal rule” when the plaintiffs voluntarily dismissed the second case. However, the Court rejected this argument, stating that the trial court’s instruction to file an appropriate pleading did not reverse the original dismissal, which was due to a lack of jurisdiction. Thus, the dismissal of the first case remained at the instance of the defendant, not the plaintiff.

The Court then addressed the issue of forum shopping. The respondents filed Civil Case No. 02-105251 (the third case) while the motion for reconsideration of the dismissal of the second case was still pending. Forum shopping occurs when a party institutes two or more actions involving the same parties, cause of action, and relief sought, either simultaneously or successively, with the hope of obtaining a favorable disposition. In this case, the Court found that the filing of the third case while the motion for reconsideration in the second case was pending constituted forum shopping. The Court explained that the dismissal order in the second case was not yet final, as it could still be overturned upon reconsideration or appeal. The requisites of litis pendentia, which include identity of parties, rights asserted, relief prayed for, and cases such that judgment in one would amount to res judicata in the other, were present.

Issue	Petitioner’s Argument	Court’s Ruling
Application of Two-Dismissal Rule	The failure to file an amended complaint in the first case operated as a dismissal on the merits, making the dismissal of the second case with prejudice.	The first dismissal was at the defendant’s instance due to lack of jurisdiction, not the plaintiff’s. Thus, the Two-Dismissal Rule does not apply.
Forum Shopping	N/A	The filing of the third case while the motion for reconsideration of the second case was pending constituted forum shopping.

Despite finding that the respondents engaged in forum shopping, the Court declined to strictly apply the “twin-dismissal rule,” which would have resulted in the dismissal of the third case. The Court reasoned that the filing of the third case was not precisely for the purpose of obtaining a favorable result, but to get the case moving, as the respondents suspected that their counsel was not adequately protecting their interests. The Court emphasized that cases should be determined on their merits, and a strict application of the rules, resulting in technicalities that frustrate substantial justice, must be avoided. Furthermore, the circumstances showed valid procedural reasons for allowing the third case to proceed, including the dismissal of the motion for reconsideration in the second case and the presence of a better cause of action in the third case.

The Supreme Court ultimately denied the petition, ordering the Regional Trial Court of Manila, Branch 6, to proceed with Civil Case No. 02-105251 with due dispatch. This decision underscores the importance of understanding the nuances of procedural rules and the circumstances surrounding each case. It also highlights the Court’s preference for resolving cases on their merits, balancing procedural safeguards with the pursuit of substantial justice.

FAQs

What is the “two-dismissal rule”?	The “two-dismissal rule” states that if a plaintiff voluntarily dismisses a case twice, the second dismissal operates as an adjudication on the merits, preventing the plaintiff from re-filing the same claim. This rule is designed to prevent vexatious litigation.
When does the “two-dismissal rule” apply?	The rule applies only when both dismissals are initiated by the plaintiff. If the first dismissal is due to the defendant’s motion or the court’s initiative, the rule does not apply.
What is forum shopping?	Forum shopping occurs when a party files multiple cases involving the same parties, cause of action, and relief sought in different courts, hoping to obtain a favorable outcome in one of them. It is considered an abuse of court processes.
What is the effect of forum shopping?	The penalty for forum shopping is the summary dismissal of all pending actions on the same claim filed in any court. This is a punitive measure to prevent parties from trifling with the orderly administration of justice.
What is litis pendentia?	Litis pendentia refers to a situation where another action is pending between the same parties for the same cause of action, making the second action unnecessary and vexatious. It is a ground for dismissing a civil action.
What are the requisites of litis pendentia?	The requisites include (a) identity of parties, (b) identity of rights asserted and relief prayed for, and (c) identity of the two cases such that judgment in one would amount to res judicata in the other.
What is res judicata?	Res judicata is a doctrine that prevents a party from re-litigating an issue that has already been decided by a competent court. It requires a final judgment on the merits, identity of parties, subject matter, and cause of action.
Can a defendant file a motion for reconsideration of an order denying a motion to dismiss?	Yes, a defendant has the right to file a motion for reconsideration of a trial court’s order denying the motion to dismiss. There is no rule prohibiting such a motion.
What happens if a party files a case while a motion for reconsideration is pending in a related case?	Filing a case while a motion for reconsideration is pending in a related case may constitute forum shopping, as the dismissal order is not yet final and the outcome of the motion could affect the new case.

In conclusion, the Supreme Court’s decision in Ching v. Cheng serves as a reminder of the importance of adhering to procedural rules and avoiding forum shopping. While the Court recognized the respondents’ procedural misstep, it ultimately prioritized substantial justice, allowing the case to proceed on its merits. This case underscores the need for litigants to seek proper legal guidance and to ensure that their actions are consistent with the principles of fairness and judicial efficiency.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Ramon Ching and Po Wing Properties, Inc. vs. Joseph Cheng, Jaime Cheng, Mercedes Igne and Lucina Santos, G.R. No. 175507, October 08, 2014