[G.R. No. 138104.

April 11, 2002]

MR HOLDINGS, LTD., petitioner, vs. SHERIFF CARLOS P. BAJAR, SHERIFF FERDINAND
M. JANDUSAY, SOLIDBANK CORPORATION, AND MARCOPPER MINING
CORPORATION, respondents.
Commercial Law Corporation Law License Requirement Foreign Corporation Being an
assignee does not automatically mean doing business
Marcopper Mining Corporation was unable to pay its loans from the Asian Development Bank
(ADB). Later, ADB transferred all its rights to collect from Marcopper to MR Holdings, Ltd. In
order to pay MR Holdings, Marcopper assigned all its assets to MR Holdings and executed
therefor a Deed of Assignment in MR Holdings favor.
Meanwhile, another creditor of Marcopper, Solidbank Corporation, won a case against
Marcopper. The court then issued a writ of execution directing Sheriff Carlos Bajar to levy
Marcoppers assets.
MR Holdings then filed an opposition asserting that it is now the owner of Marcoppers assets
hence, Bajar cannot levy them. The lower court denied MR Holdings on the ground that the
Deed of Assignment was made in bad faith and that MR Holdings was a foreign corporation
doing business without a license in the Philippines (by virtue of the Deed of Assignment) and as
such cannot sue in the Philippines.
ISSUE: Whether or not MR Holdings may sue on this particular transaction.
HELD: Yes. The Supreme Court emphasized the following rules when it comes to foreign
corporations doing business here in the Philippines:
1.

if a foreign corporation does business in the Philippines without a license,

it cannot sue before the Philippine courts;

2.

if a foreign corporation is not doing business in the Philippines, it needs no

license to sue before Philippine courts on an isolated transaction or on a cause of action
entirely independent of any business transaction;

3.

if a foreign corporation does business in the Philippines with the required

license, it can sue before Philippine courts on any transaction.
Being a mere assignee does not constitute doing business in the Philippines. MR Holdings, a
foreign corporation, cannot be said to be doing business simply because it became an assignee
of Marcopper. MR Holdings was not doing anything else other than being a mere assignee. The
only time that MR Holdings is considered to be doing business here is that if it continues the
business of Marcopper which it did not.
Therefore, since it is not doing business here, pursuant to the rules above, it can sue without
any license before Philippine courts on an isolated transaction or on a cause of action entirely
independent of any business transaction.
Anent the issue of bad faith, the same was not proven. It appears that the deed of assignment
was an earlier agreement incidental to the loan agreement between ADB and Marcopper which
precedes the action brought by Solidbank against Marcopper.