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Del Monte v. CA Case Digest
Del Monte v. CA Case Digest
CA RULING:
Del Monte Corporation-USA (DMC-USA) entered The Agreement between DMC-USA and MMI is a
into a Distributorship Agreement with Montebueno contract. The provision to submit to arbitration any
Marketing, Inc. (MMI) as the sole and exclusive dispute arising therefrom and the relationship of the
distributor of its Del Monte Products in the parties is part of the contract and is itself a contract.
Philippines for a period of five (5) years. The
Agreement provided for an arbitration clause As a rule, contracts are respected as the law between
which states: the contracting parties and produce effect as between
them, their assigns and heirs. Clearly, only parties to
12. GOVERNING LAW AND ARBITRATION the Agreement, i.e. DMC-USA and MMI are bound by
the Agreement and its arbitration clause as they are
This Agreement shall be governed by the laws the only signatories thereto. SFI, not a party to the
of the State of California and/or, if applicable, Agreement and cannot be considered assigns or heirs
the United States of America. All disputes of the parties, are not bound by the Agreement and
arising out of or relating to this Agreement or arbitration clause therein.
the parties relationship, including the
termination thereof, shall be resolved by 2. ON SUSPENSION OF TRIAL PENDING
arbitration in the City of San Francisco, State ARBITRATION
of California, under the Rules of the American
Arbitration Association. The arbitration panel While the court recognizes the right of the contracting
shall consist of three members, one of whom parties to arbitrate or to compel arbitration, the splitting
shall be selected by DMC-USA, one of whom of the proceedings to arbitration as to some of the
shall be selected by MMI, and the third of parties on one hand and trial for the others on the
whom shall be selected by the other two other hand, or the suspension of trial pending
members and shall have relevant experience arbitration between some parties, should not be
in the industry x x x x allowed as it would, in effect, resort in multiplicity of
suits, duplicitous procedure and unnecessary delay.
MMI appointed Sabrosa Foods, Inc. (SFI), with the
approval of DMC-USA, as MMIs marketing arm. The object of arbitration is to allow the expeditious
determination of a dispute. Clearly, the issues at hand
could not be speedily and efficiently resolved in its
SFI and MMIs Managing Director Liong Liong C.
entirety if simultaneous arbitration proceedings and
Sy filed a Complaint against DMC-USA alleging
trial, or suspension of trial pending arbitration is to be
that the latters products were being brought in the
allowed. The interest of justice would only be served if
country by other importers despite its agreement
the trial court hears and adjudicates the case in a
that MMI will be the sole and exclusive distributor
single and complete proceeding.
of its products.
ISSUE: