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EN BANC

MANUEL LUIS C. GONZALES

and FRANCIS MARTIN D.
GONZALES,
Petitioners,

- versus -

GJH LAND, INC. (formerly

known as S.J. LAND, INC.),
CHANG HWAN JANG a.k.a.
STEVE JANG, SANG RAK KIM,
MARIECHU N. YAP, and ATTY.
ROBERTO P. MALLARI II,
Respondents.

GR. No. 202664

Present:
SERENO, CJ.
CARPIO,
VELASCO, JR.,
LEONARDO-DE CASTRO,
BRION,*
PERALTA,
BERSAMIN,
DEL CASTILLO,
VILLARAMA, JR.,
PEREZ,
MENDOZA,**
REYES,
PERLAS-BERNABE,
LEONEN, and
JARDELEZA, JJ.
Promulgated:

~ ---~A.------~-----x

10 2015

NMnta:
r-t~
x ------------------------------------------------------.

a-

DECISION
PERLAS-BERNABE, J.:

This is a direct recourse to the Court, via a petition for review on

certiorari, 1 from the Orders dated April 17, 2012 2 and July 9, 2012 3 of the
Regional Trial Court (RTC) of Muntinlupa City, Branch 276 (Branch 276)
dismissing Civil Case No. 11-077 for lack of jurisdiction.

On leave.
On leave.
Rollo, pp. I 0-28.
Id. at 34-38. Penned by Presiding Judge Antonietta Pablo-Medina.
Id. at 39-41.

Decision

G.R. No. 202664

The Facts
On August 4, 2011, petitioners Manuel Luis C. Gonzales4 and Francis
Martin D. Gonzales (petitioners) filed a Complaint5 for Injunction with
prayer for Issuance of Status Quo Order, Three (3) and Twenty (20)-Day
Temporary Restraining Orders, and Writ of Preliminary Injunction with
Damages against respondents GJH Land, Inc. (formerly known as S.J.
Land, Inc.), Chang Hwan Jang, Sang Rak Kim, Mariechu N. Yap, and Atty.
Roberto P. Mallari II6 (respondents) before the RTC of Muntinlupa City
seeking to enjoin the sale of S.J. Land, Inc.s shares which they purportedly
bought from S.J. Global, Inc. on February 1, 2010. Essentially, petitioners
alleged that the subscriptions for the said shares were already paid by them
in full in the books of S.J. Land, Inc.,7 but were nonetheless offered for sale
on July 29, 2011 to the corporations stockholders,8 hence, their plea for
injunction.
The case was docketed as Civil Case No. 11-077 and raffled to
Branch 276, which is not a Special Commercial Court. On August 9,
2011, said branch issued a temporary restraining order,9 and later, in an
Order10 dated August 24, 2011, granted the application for a writ of
preliminary injunction.
After filing their respective answers11 to the complaint, respondents
filed a motion to dismiss12 on the ground of lack of jurisdiction over the
subject matter, pointing out that the case involves an intra-corporate
dispute and should, thus, be heard by the designated Special Commercial
Court of Muntinlupa City.13
The RTC Ruling
In an Order14 dated April 17, 2012, Branch 276 granted the motion to
dismiss filed by respondents. It found that the case involves an intracorporate dispute that is within the original and exclusive jurisdiction of the
RTCs designated as Special Commercial Courts. It pointed out that the RTC
of Muntinlupa City, Branch 256 (Branch 256) was specifically designated by
the Court as the Special Commercial Court, hence, Branch 276 had no
jurisdiction over the case and cannot lawfully exercise jurisdiction on the
4
5
6
7
8
9
10
11
12
13
14

Francis Martin C. Gonzales in some parts of the records.

Dated August 2, 2011. Rollo, pp. 42-53.
Atty. Roberto P. Mallari in some parts of the records.
Rollo, p. 44.
Id. at 47.
Id. at 90-91.
Id. at 92-97.
Id. at 14.
Dated February 7, 2011. (Id. at 98-114.)
Id. at 107-110.
Id. at 34-38.

Decision

G.R. No. 202664

matter, including the issuance of a Writ of Preliminary Injunction.15

Accordingly, it dismissed the case.
Dissatisfied, petitioners filed a motion for reconsideration,16 arguing
that they filed the case with the Office of the Clerk of Court of the RTC of
Muntinlupa City which assigned the same to Branch 276 by raffle.17 As the
raffle was beyond their control, they should not be made to suffer the
consequences of the wrong assignment of the case, especially after paying
the filing fees in the amount of 235,825.00 that would be for naught if the
dismissal is upheld.18 They further maintained that the RTC has jurisdiction
over intra-corporate disputes under Republic Act No. (RA) 8799,19 but since
the Court selected specific branches to hear and decide such suits, the case
must, at most, be transferred or raffled off to the proper branch.20
In an Order21 dated July 9, 2012, Branch 276 denied the motion for
reconsideration, holding that it has no authority or power to order the
transfer of the case to the proper Special Commercial Court, citing Calleja v.
Panday22 (Calleja); hence, the present petition.
The Issue Before the Court
The essential issue for the Courts resolution is whether or not Branch
276 of the RTC of Muntinlupa City erred in dismissing the case for lack of
jurisdiction over the subject matter.
The Courts Ruling
The petition is meritorious.
At the outset, the Court finds Branch 276 to have correctly
categorized Civil Case No. 11-077 as a commercial case, more particularly,
an intra-corporate dispute,23 considering that it relates to petitioners averred
rights over the shares of stock offered for sale to other stockholders, having
paid the same in full. Applying the relationship test and the nature of the
controversy test, the suit between the parties is clearly rooted in the
existence of an intra-corporate relationship and pertains to the enforcement
of their correlative rights and obligations under the Corporation Code and

15
16
17
18
19
20
21
22
23

Id. at 37.
Dated May 8, 2012. Id. at 152-160.
Id. at 152-154.
Id. at 154-155.
Otherwise known as The Securities Regulation Code.
Rollo, p. 155.
Id. at 39-41.
518 Phil. 801 (2006).
Rollo, p. 37.

Decision

G.R. No. 202664

the internal and intra-corporate regulatory rules of the corporation,24 hence,

intra-corporate, which should be heard by the designated Special
Commercial Court as provided under A.M. No. 03-03-03-SC25 dated June
17, 2003 in relation to Item 5.2, Section 5 of RA 8799.
The present controversy lies, however, in the procedure to be followed
when a commercial case such as the instant intra-corporate dispute
has been properly filed in the official station of the designated Special
Commercial Court but is, however, later wrongly assigned by raffle to a
regular branch of that station.
As a basic premise, let it be emphasized that a courts acquisition of
jurisdiction over a particular cases subject matter is different from incidents
pertaining to the exercise of its jurisdiction. Jurisdiction over the subject
matter of a case is conferred by law, whereas a courts exercise of
jurisdiction, unless provided by the law itself, is governed by the Rules of
Court or by the orders issued from time to time by the Court.26 In Lozada v.
Bracewell,27 it was recently held that the matter of whether the RTC
resolves an issue in the exercise of its general jurisdiction or of its
limited jurisdiction as a special court is only a matter of procedure and
has nothing to do with the question of jurisdiction.
Pertinent to this case is RA 8799 which took effect on August 8, 2000.
By virtue of said law, jurisdiction over cases enumerated in Section 528 of
Presidential Decree No. 902-A29 was transferred from the Securities and

24
25

26
27
28

29

See Medical Plaza Makati Condominium Corporation v. Cullen, G.R. No. 181416, November 11,
2013, 709 SCRA 110, 120-121; citations omitted.
Entitled RE: CONSOLIDATION OF INTELLECTUAL PROPERTY COURTS WITH COMMERCIAL COURTS (July
1, 2003). Prior to A.M. No. 03-03-03-SC, however, the Court had already issued several resolutions in
A.M. No. 00-11-03-SC (Entitled RESOLUTION DESIGNATING CERTAIN BRANCHES OF REGIONAL TRIAL
COURTS TO TRY AND DECIDE CASES FORMERLY COGNIZABLE BY THE SECURITIES AND EXCHANGE
COMMISSION [November 21, 2000]), A.M. No. 01-5-298-RTC (August 27, 2001), and A.M. No. 0112-656-RTC (July 8, 2002) to implement the provisions of Item 5.2, Section 5 of RA 8799.
See Herrera, Oscar M., Remedial Law, Vol. I, 2007 Ed., p. 73.
G.R. No. 179155, April 2, 2014, 720 SCRA 371, 381.
SEC. 5. In addition to the regulatory and adjudicative functions of the Securities and Exchange
Commission over corporations, partnerships and other forms of associations registered with it as
expressly granted under existing laws and decrees, it shall have original and exclusive jurisdiction to
hear and decide cases involving.
a. Devices or schemes employed by or any acts, of the board of directors, business associates, its
officers or partners, amounting to fraud and misrepresentation which may be detrimental to the
interest of the public and/or of the stockholder, partners, members of associations or organizations
registered with the Commission.
b. Controversies arising out of intra-corporate or partnership relations, between and among'
stockholders, members, or associates; between any or all of them and the corporation, partnership
or association of which they are stockholders, members or associates, respectively; and between
such corporation, partnership or association and the state insofar as it concerns their individual
franchise or right to exist as such entity;
c. Controversies in the election or appointments of directors, trustees, officers or managers of such
corporations, partnerships or associations.
Entitled REORGANIZATION OF THE SECURITIES AND EXCHANGE COMMISSION WITH ADDITIONAL
POWERS AND PLACING THE SAID AGENCY UNDER THE ADMINISTRATIVE SUPERVISION OF THE OFFICE OF
THE PRESIDENT (March 11, 1976).

Decision

G.R. No. 202664

Exchange Commission (SEC) to the RTCs, being courts of general

jurisdiction. Item 5.2, Section 5 of RA 8799 provides:
SEC. 5. Powers and Functionsof the Commission. x x x
xxxx
5.2 The Commissions jurisdiction over all cases enumerated under
Section 5 of Presidential Decree No. 902-A is hereby transferred to the
Courts of general jurisdiction or the appropriate Regional Trial
Court: Provided, that the Supreme Court in the exercise of its
authority may designate the Regional Trial Court branches that shall
exercise jurisdiction over the cases. The Commission shall retain
jurisdiction over pending cases involving intra-corporate disputes
submitted for final resolution which should be resolved within one (1)
year from the enactment of this Code. The Commission shall retain
jurisdiction over pending suspension of payments/rehabilitation cases filed
as of 30 June 2000 until finally disposed. (Emphasis supplied)

The legal attribution of Regional Trial Courts as courts of general

jurisdiction stems from Section 19 (6), Chapter II of Batas Pambansa
Bilang (BP) 129,30 known as The Judiciary Reorganization Act of 1980:
Section 19. Jurisdiction in civil cases. Regional Trial Courts shall
exercise exclusive original jurisdiction:
xxxx
(6) In all cases not within the exclusive jurisdiction of any court, tribunal,
person or body exercising jurisdiction or any court, tribunal, person or
body exercising judicial or quasi-judicial functions; x x x x

As enunciated in Durisol Philippines, Inc. v. CA:31

The regional trial court, formerly the court of first instance, is a
court of general jurisdiction. All cases, the jurisdiction over which is not
specifically provided for by law to be within the jurisdiction of any other
court, fall under the jurisdiction of the regional trial court.32

To clarify, the word or in Item 5.2, Section 5 of RA 8799 was

intentionally used by the legislature to particularize the fact that the phrase
the Courts of general jurisdiction is equivalent to the phrase the
appropriate Regional Trial Court. In other words, the jurisdiction of the
SEC over the cases enumerated under Section 5 of PD 902-A was
transferred to the courts of general jurisdiction, that is to say (or, otherwise
30
31
32

Entitled AN ACT REORGANIZING THE JUDICIARY, APPROPRIATING FUNDS THEREFOR, AND FOR OTHER
PURPOSES (approved on August 14, 1981).
427 Phil. 604 (2002).
Id. at 612.

Decision

G.R. No. 202664

known as), the proper Regional Trial Courts. This interpretation is supported
by San Miguel Corp. v. Municipal Council,33 wherein the Court held that:
[T]he word or may be used as the equivalent of that is to say and
gives that which precedes it the same significance as that which follows it.
It is not always disjunctive and is sometimes interpretative or expository
of the preceding word.34

Further, as may be gleaned from the following excerpt of the

Congressional deliberations:
Senator [Raul S.] Roco: x x x.
xxxx
x x x. The first major departure is as regards the Securities and Exchange
Commission. The Securities and Exchange Commission has been
authorized under this proposal to reorganize itself. As an administrative
agency, we strengthened it and at the same time we take away the quasijudicial functions. The quasi-judicial functions are now given back to
the courts of general jurisdiction - the Regional Trial Court, except for
two categories of cases.
In the case of corporate disputes, only those that are now submitted
for final determination of the SEC will remain with the SEC. So, all those
cases, both memos of the plaintiff and the defendant, that have been
submitted for resolution will continue. At the same time, cases involving
rehabilitation, bankruptcy, suspension of payments and receiverships that
were filed before June 30, 2000 will continue with the SEC. in other
words, we are avoiding the possibility, upon approval of this bill, of
people filing cases with the SEC, in manner of speaking, to select their
court.35
x x x x (Emphasis supplied)

Therefore, one must be disabused of the notion that the transfer of

jurisdiction was made only in favor of particular RTC branches, and not the
RTCs in general.
Consistent with the foregoing, history depicts that when the transfer of
SEC cases to the RTCs was first implemented, they were transmitted to the
Executive Judges of the RTCs for raffle between or among its different
branches, unless a specific branch has been designated as a Special
Commercial Court, in which instance, the cases were transmitted to said

33
34
35

152 Phil. 30 (1973).

Id. at 38.
See Transcript of Session Proceedings in Securities Act of 1998, SB. NO. 1220/CR. No. 6, RA 8799
dated July 17, 2000, p. 222.

Decision

G.R. No. 202664

branch.36 It was only on November 21, 2000 that the Court designated
certain RTC branches to try and decide said SEC cases37 without, however,
providing for the transfer of the cases already distributed to or filed with the
regular branches thereof. Thus, on January 23, 2001, the Court issued SC
Administrative Circular No. 08-200138 directing the transfer of said cases to
the designated courts (commercial SEC courts). Later, or on June 17, 2003,
the Court issued A.M. No. 03-03-03-SC consolidating the commercial SEC
courts and the intellectual property courts39 in one RTC branch in a
particular locality, i.e., the Special Commercial Court, to streamline the
court structure and to promote expediency.40 Accordingly, the RTC
branch so designated was mandated to try and decide SEC cases, as well as
those involving violations of intellectual property rights, which were,
thereupon, required to be filed in the Office of the Clerk of Court in the
official station of the designated Special Commercial Courts, to wit:
1. The Regional Courts previously designated as SEC Courts
through the: (a) Resolutions of this Court dated 21 November 2000, 4 July
2001, 12 November 2002, and 9 July 2002 all issued in A.M. No. 00-1103-SC; (b) Resolution dated 27 August 2001 in A.M. No. 01-5-298-RTC;
and (c) Resolution dated 8 July 2002 in A.M. No. 01-12-656-RTC are
hereby DESIGNATED and shall be CALLED as Special Commercial
Courts to try and decide cases involving violations of Intellectual Property
Rights which fall within their jurisdiction and those cases formerly
cognizable by the Securities and Exchange Commission;
xxxx
4. The Special Commercial Courts shall have jurisdiction over
cases arising within their respective territorial jurisdiction with respect to
the National Capital Judicial Region and within the respective provinces
with respect to the First to Twelfth Judicial Regions. Thus, cases shall be
filed in the Office of the Clerk of Court in the official station of the
designated Special Commercial Court;41
x x x x (Underscoring supplied)

36

37

38
39

40
41

See Resolution dated August 22, 2000 in A.M. No. 00-8-10-SC, entitled IN RE: TRANSFER OF CASES
FROM THE SECURITIES AND EXCHANGE COMMISSION TO THE REGULAR COURTS PURSUANT TO R. A. NO.
8799.
See Resolution dated November 21, 2000 in A.M. No. 00-11-03-SC, entitled RESOLUTION
DESIGNATING CERTAIN BRANCHES OF REGIONAL TRIAL COURTS TO TRY AND DECIDE CASES FORMERLY
COGNIZABLE BY THE SECURITIES AND EXCHANGE COMMISSION.
Entitled TRANSFER TO DESIGNATED REGIONAL TRIAL COURTS OF SEC CASES ENUMERATED IN
SECTION 5, P. D. NO. 902-A FROM THE REGULAR REGIONAL TRIAL COURTS (March 1, 2001).
Designated to try violations of intellectual property rights under RA 8293, otherwise known as the
Intellectual Property Code of the Philippines and under SC A.O. No. 113-95 (Entitled RE:
DESIGNATION OF SPECIAL COURTS FOR INTELLECTUAL PROPERTY RIGHTS [October 2, 1995]), as
amended by SC A.O. No. 104-96 (Entitled RE: DESIGNATION OF SPECIAL COURTS FOR KIDNAPPING,
ROBBERY, CARNAPPING, DANGEROUS DRUGS CASES AND OTHER HEINOUS CRIMES; INTELLECTUAL
PROPERTY RIGHTS VIOLATIONS AND JURISDICTION IN LIBEL CASES [October 21, 1996]) and A.M. No.
02-1-11-SC (Entitled RE: DESIGNATION OF AN INTELLECTUAL PROPERTY JUDGE FOR MANILA
[February 19, 2002]).
Tan v. Bausch & Lomb, Inc., 514 Phil. 307, 316 (2005). See also final whereas clause of A.M. No. 0303-03-SC.
See OCA Circular No. 82-2003, entitled SUBJECT: CONSOLIDATION OF INTELLECTUAL PROPERTY
COURTS WITH COMMERCIAL COURTS (June 30, 2003).

Decision

G.R. No. 202664

It is important to mention that the Courts designation of Special

Commercial Courts was made in line with its constitutional authority to
supervise the administration of all courts as provided under Section 6,
Article VIII of the 1987 Constitution:
Section 6. The Supreme Court shall have administrative
supervision over all courts and the personnel thereof.

The objective behind the designation of such specialized courts is to

promote expediency and efficiency in the exercise of the RTCs
jurisdiction over the cases enumerated under Section 5 of PD 902-A. Such
designation has nothing to do with the statutory conferment of jurisdiction to
all RTCs under RA 8799 since in the first place, the Court cannot enlarge,
diminish, or dictate when jurisdiction shall be removed, given that the
power to define, prescribe, and apportion jurisdiction is, as a general
rule, a matter of legislative prerogative.42 Section 2, Article VIII of the
1987 Constitution provides:
Section 2. The Congress shall have the power to define, prescribe,
and apportion the jurisdiction of the various courts but may not deprive the
Supreme Court of its jurisdiction over cases enumerated in Section 5
hereof.
xxxx

Here, petitioners filed a commercial case, i.e., an intra-corporate

dispute, with the Office of the Clerk of Court in the RTC of Muntinlupa City,
which is the official station of the designated Special Commercial Court, in
accordance with A.M. No. 03-03-03-SC. It is, therefore, from the time of
such filing that the RTC of Muntinlupa City acquired jurisdiction over
the subject matter or the nature of the action.43 Unfortunately, the
commercial case was wrongly raffled to a regular branch, i.e., Branch
276, instead of being assigned44 to the sole Special Commercial Court in
the RTC of Muntinlupa City, which is Branch 256. This error may have
been caused by a reliance on the complaints caption, i.e., Civil Case for
Injunction with prayer for Status Quo Order, TRO and Damages,45 which,
however, contradicts and more importantly, cannot prevail over its actual
allegations that clearly make out an intra-corporate dispute:

42
43
44

45

See Tinitigan v. Tinitigan, Sr., 188 Phil. 597, 611 (1980).

See Herrera, Oscar M., Remedial Law, Vol. I, 2007 Ed., p. 112-113. See also Tinitigan v. Tinitigan, Sr.,
id.
Item 6 of A.M. No. 03-03-03-SC provides:
6. In order to ensure a just and equitable distribution of cases, the designated Special
Commercial Court shall continue to participate in the raffles of other cases. Provided,
however, that the Executive Judge concerned shall adopt a procedure whereby every IP
and SEC case assigned to a Special Commercial Court should be considered a case
raffled to it and duly credited to such court. (Emphasis supplied)
See rollo, p. 42.

Decision

G.R. No. 202664

16. To the surprise of MLCG and FMDG, however, in two identical

letters both dated 13 May 2011, under the letterhead of GJH Land, Inc.,
Yap, now acting as its President, Jang and Kim demanded payment of
supposed unpaid subscriptions of MLCG and FMDG amounting to
10,899,854.30 and 2,625,249.41, respectively.
16.1 Copies of the letters dated 13 May 2011 are
attached hereto and made integral parts hereof as Annexes
J and K, repectively.
17. On 29 July 2011, MLCG and FMDG received an Offer Letter
addressed to stockholders of GJH Land, Inc. from Yap informing all
stockholders that GJH Land, Inc. is now offering for sale the unpaid shares
of stock of MLCG and FMDG. The same letter states that the offers to
purchase these shares will be opened on 10 August 2011 with payments to
be arranged by deposit to the depository bank of GJH Land, Inc.
17.1 A copy of the undated Offer Letter is attached
hereto and made and made an integral part hereof as Annex
L.
18. The letter of GJH Land, Inc. through Yap, is totally without
legal and factual basis because as evidenced by the Deeds of Assignment
signed and certified by Yap herself, all the S.J. Land, Inc. shares acquired
by MLCG and FMDG have been fully paid in the books of S.J. Land, Inc.
19. With the impending sale of the alleged unpaid subscriptions on
10 August 2011, there is now a clear danger that MLCG and FMDG
would be deprived of these shares without legal and factual basis.
20. Furthermore, if they are deprived of these shares through the
scheduled sale, both MLCG and FMDG would suffer grave and
irreparable damage incapable of pecuniary estimation.
21. For this reason, plaintiffs now come to the Honorable Court for
injunctive relief so that after trial on the merits, a permanent injunction
should be issued against the defendants preventing them from selling the
shares of the plaintiffs, there being no basis for such sale.46

According to jurisprudence, it is not the caption but the allegations in

the complaint or other initiatory pleading which give meaning to the
pleading and on the basis of which such pleading may be legally
characterized.47 However, so as to avert any future confusion, the Court
requires henceforth, that all initiatory pleadings state the actions nature both
in its caption and the body, which parameters are defined in the dispositive
portion of this Decision.
Going back to the case at bar, the Court nonetheless deems that the
erroneous raffling to a regular branch instead of to a Special Commercial
Court is only a matter of procedure that is, an incident related to the
exercise of jurisdiction and, thus, should not negate the jurisdiction which
46
47

Id. at 47-48.
Republic of the Phils. v. Nolasco, 496 Phil. 853, 867 (2005).

Decision

10

G.R. No. 202664

the RTC of Muntinlupa City had already acquired. In such a scenario, the
proper course of action was not for the commercial case to be dismissed;
instead, Branch 276 should have first referred the case to the Executive
Judge for re-docketing as a commercial case; thereafter, the Executive
Judge should then assign said case to the only designated Special
Commercial Court in the station, i.e., Branch 256.
Note that the procedure would be different where the RTC acquiring
jurisdiction over the case has multiple special commercial court branches;
in such a scenario, the Executive Judge, after re-docketing the same as a
commercial case, should proceed to order its re-raffling among the said
special branches.
Meanwhile, if the RTC acquiring jurisdiction has no branch
designated as a Special Commercial Court, then it should refer the case to
the nearest RTC with a designated Special Commercial Court branch within
the judicial region.48 Upon referral, the RTC to which the case was referred
to should re-docket the case as a commercial case, and then: (a) if the said
RTC has only one branch designated as a Special Commercial Court, assign
the case to the sole special branch; or (b) if the said RTC has multiple
branches designated as Special Commercial Courts, raffle off the case
among those special branches.
In all the above-mentioned scenarios, any difference regarding the
applicable docket fees should be duly accounted for. On the other hand, all
docket fees already paid shall be duly credited, and any excess, refunded.
At this juncture, the Court finds it fitting to clarify that the RTC
mistakenly relied on the Calleja case to support its ruling. In Calleja, an
intra-corporate dispute49 among officers of a private corporation with
principal address at Goa, Camarines Sur, was filed with the RTC of San
Jose, Camarines Sur, Branch 58 instead of the RTC of Naga City, which is
the official station of the designated Special Commercial Court for
Camarines Sur. Consequently, the Court set aside the RTC of San Jose,
Camarines Surs order to transfer the case to the RTC of Naga City and
dismissed the complaint considering that it was filed before a court which,
having no internal branch designated as a Special Commercial Court, had no
jurisdiction over those kinds of actions, i.e., intra-corporate disputes. Calleja
involved two different RTCs, i.e., the RTC of San Jose, Camarines Sur and
the RTC of Naga City, whereas the instant case only involves one RTC,
i.e., the RTC of Muntinlupa City, albeit involving two different branches of
the same court, i.e., Branches 256 and 276. Hence, owing to the variance in
the facts attending, it was then improper for the RTC to rely on the Calleja
ruling.
48
49

See Item No. 3 of A.M. No. 03-03-03-SC, as amended, dated June 15, 2015.
A case for quo warranto against members of the board of directors and officers of St. John Hospital,
Incorporated, docketed as Civil Case No. T-1007.

Decision

11

G.R. No. 202664

Besides, the Court observes that the fine line that distinguishes subject
matter jurisdiction and exercise of jurisdiction had been clearly blurred in
Calleja. Harkening back to the statute that had conferred subject matter
jurisdiction, two things are apparently clear: (a) that the SECs subject
matter jurisdiction over intra-corporate cases under Section 5 of
Presidential Decree No. 902-A was transferred to the Courts of general
jurisdiction, i.e., the appropriate Regional Trial Courts; and (b) the
designated branches of the Regional Trial Court, as per the rules
promulgated by the Supreme Court, shall exercise jurisdiction over such
cases. Item 5.2, Section 5 of RA 8799 provides:
SEC. 5. Powers and Functions of the Commission. x x x
xxxx
5.2 The Commissions jurisdiction over all cases enumerated under
Section 5 of Presidential Decree No. 902-A is hereby transferred to the
Courts of general jurisdiction or the appropriate Regional Trial
Court: Provided, that the Supreme Court in the exercise of its
authority may designate the Regional Trial Court branches that shall
exercise jurisdiction over the cases. x x x.

In contrast, the appropriate jurisprudential reference to this case would

be Tan v. Bausch & Lomb, Inc.,50 which involves a criminal complaint for
violation of intellectual property rights filed before the RTC of Cebu City
but was raffled to a regular branch thereof (Branch 21), and not to a Special
Commercial Court. As it turned out, the regular branch subsequently denied
the private complainants motion to transfer the case to the designated
special court of the same RTC, on the ground of lack of jurisdiction. The
CA reversed the regular branch and, consequently, ordered the transfer of the
case to the designated special court at that time (Branch 9). The Court,
affirming the CA, declared that the RTC had acquired jurisdiction over the
subject matter. In view, however, of the designation of another court as the
Special Commercial Court in the interim (Branch 11 of the same Cebu City
RTC), the Court accordingly ordered the transfer of the case and the
transmittal of the records to said Special Commercial Court instead.51
Similarly, the transfer of the present intra-corporate dispute from
Branch 276 to Branch 256 of the same RTC of Muntinlupa City, subject
to the parameters above-discussed is proper and will further the
purposes stated in A.M. No. 03-03-03-SC of attaining a speedy and
efficient administration of justice.
For further guidance, the Court finds it apt to point out that the same
principles apply to the inverse situation of ordinary civil cases filed
before the proper RTCs but wrongly raffled to its branches designated
as Special Commercial Courts. In such a scenario, the ordinary civil case
50
51

Supra note 40.

See id. at 314-316.

Decision

12

G.R. No. 202664

should then be referred to the Executive Judge for re-docketing as an

ordinary civil case; thereafter, the Executive Judge should then order
the raffling of the case to all branches of the same RTC, subject to
limitations under existing internal rules, and the payment of the correct
docket fees in case of any difference. Unlike the limited
assignment/raffling of a commercial case only to branches designated as
Special Commercial Courts in the scenarios stated above, the re-raffling of
an ordinary civil case in this instance to all courts is permissible due to the
fact that a particular branch which has been designated as a Special
Commercial Court does not shed the RTCs general jurisdiction over
ordinary civil cases under the imprimatur of statutory law, i.e., Batas
Pambansa Bilang (BP) 129.52 To restate, the designation of Special
Commercial Courts was merely intended as a procedural tool to expedite the
resolution of commercial cases in line with the courts exercise of
jurisdiction. This designation was not made by statute but only by an
internal Supreme Court rule under its authority to promulgate rules
governing matters of procedure and its constitutional mandate to supervise
52

Section 19 of BP 129, entitled AN ACT REORGANIZING THE JUDICIARY, APPROPRIATING FUNDS

THEREFOR, AND FOR OTHER PURPOSES, as amended by RA 7691, entitled AN ACT EXPANDING THE
JURISDICTION OF THE METROPOLITAN TRIAL COURTS, MUNICIPAL TRIAL COURTS, AND MUNICIPAL
CIRCUIT TRIAL COURTS, AMENDING FOR THE PURPOSE BATAS PAMBANSA BLG. 129, OTHERWISE
KNOWN AS THE JUDICIARY REORGANIZATION ACT OF 1980, reads:
Section 19. Jurisdiction in civil cases. Regional Trial Courts shall exercise exclusive
original jurisdiction:
(1) In all civil actions in which the subject of the litigation is incapable of pecuniary
estimation;
(2) In all civil actions which involve the title to, or possession of, real property, or
any interest therein, where the assessed value of the property involved exceeds
Twenty thousand pesos (20,000.00) or for civil actions in Metro Manila, where such
the value exceeds Fifty thousand pesos (50,000.00) except actions for forcible entry
into and unlawful detainer of lands or buildings, original jurisdiction over which is
conferred upon Metropolitan Trial Courts, Municipal Trial Courts, and Municipal
Circuit Trial Courts;
(3) In all actions in admiralty and maritime jurisdiction where he demand or claim
exceeds One hundred thousand pesos (100,000.00) or , in Metro Manila, where such
demand or claim exceeds Two hundred thousand pesos (200,000.00);
(4) In all matters of probate, both testate and intestate, where the gross value of the estate
exceeds One hundred thousand pesos (100,000.00) or, in probate matters in Metro
Manila, where such gross value exceeds Two hundred thousand pesos (200,000.00);
(5) In all actions involving the contract of marriage and marital relations;
(6) In all cases not within the exclusive jurisdiction of any court, tribunal, person or body
exercising jurisdiction or any court, tribunal, person or body exercising judicial or quasijudicial functions;
(7) In all civil actions and special proceedings falling within the exclusive original
jurisdiction of a Juvenile and Domestic Relations Court and of the Court of Agrarian
Relations as now provided by law; and
(8) In all other cases in which the demand, exclusive of interest, damages of whatever
kind, attorneys fees, litigation expenses, and costs or the value of the property in
controversy exceeds One hundred thousand pesos (100,000.00) or, in such other cases in
Metro Manila, where the demand, exclusive of the abovementioned items exceeds Two
hundred thousand pesos (200,000.00).

Decision

13

G.R. No. 202664

the administration of all courts and the personnel thereof.53 Certainly, an

internal rule promulgated by the Court cannot go beyond the commanding
statute. But as a more fundamental reason, the designation of Special
Commercial Courts is, to stress, merely an incident related to the courts
exercise of jurisdiction, which, as first discussed, is distinct from the concept
of jurisdiction over the subject matter. The RTCs general jurisdiction over
ordinary civil cases is therefore not abdicated by an internal rule
streamlining court procedure.
In fine, Branch 276s dismissal of Civil Case No. 11-077 is set aside
and the transfer of said case to Branch 256, the designated Special
Commercial Court of the same RTC of Muntinlupa City, under the
parameters above-explained, is hereby ordered.
WHEREFORE, the petition is GRANTED. The Orders dated April
17, 2012 and July 9, 2012 of the Regional Trial Court (RTC) of Muntinlupa
City, Branch 276 in Civil Case No. 11-077 are hereby REVERSED and
SET ASIDE. Civil Case No. 11-077 is REFERRED to the Executive Judge
of the RTC of Muntinlupa City for re-docketing as a commercial case.
Thereafter, the Executive Judge shall ASSIGN said case to Branch 256, the
sole designated Special Commercial Court in the RTC of Muntinlupa City,
which is ORDERED to resolve the case with reasonable dispatch. In this
regard, the Clerk of Court of said RTC shall DETERMINE the appropriate
amount of docket fees and, in so doing, ORDER the payment of any
difference or, on the other hand, refund any excess.
Furthermore, the Court hereby RESOLVES that henceforth, the
following guidelines shall be observed:
1.
If a commercial case filed before the proper RTC is
wrongly raffled to its regular branch, the proper courses of
action are as follows:
1.1 If the RTC has only one branch designated as a
Special Commercial Court, then the case shall be referred
53

Section 5 (5), Article VIII of the 1987 Philippine Constitution reads:

Section 5. The Supreme Court shall have the following powers:
xxxx
(5) Promulgate rules concerning the protection and enforcement of constitutional rights,
pleading, practice, and procedure in all courts, the admission to the practice of law, the
integrated bar, and legal assistance to the under-privileged. Such rules shall provide a
simplified and inexpensive procedure for the speedy disposition of cases, shall be
uniform for all courts of the same grade, and shall not diminish, increase, or modify
substantive rights. Rules of procedure of special courts and quasi-judicial bodies shall
remain effective unless disapproved by the Supreme Court.
xxxx

Decision

14

G.R. No. 202664

to the Executive Judge for re-docketing as a commercial

case, and thereafter, assigned to the sole special branch;
1.2 If the RTC has multiple branches designated as
Special Commercial Courts, then the case shall be
referred to the Executive Judge for re-docketing as a
commercial case, and thereafter, raffled off among those
special branches; and
1.3 If the RTC has no internal branch designated as a
Special Commercial Court, then the case shall be referred
to the nearest RTC with a designated Special Commercial
Court branch within the judicial region. Upon referral,
the RTC to which the case was referred to should redocket the case as a commercial case, and then: (a) if the
said RTC has only one branch designated as a Special
Commercial Court, assign the case to the sole special
branch; or (b) if the said RTC has multiple branches
designated as Special Commercial Courts, raffle off the
case among those special branches.
2.
If an ordinary civil case filed before the proper RTC is
wrongly raffled to its branch designated as a Special
Commercial Court, then the case shall be referred to the
Executive Judge for re-docketing as an ordinary civil case.
Thereafter, it shall be raffled off to all courts of the same RTC
(including its designated special branches which, by statute, are
equally capable of exercising general jurisdiction same as
regular branches), as provided for under existing rules.
3.
All transfer/raffle of cases is subject to the payment of
the appropriate docket fees in case of any difference. On the
other hand, all docket fees already paid shall be duly credited,
and any excess, refunded.
4.
Finally, to avert any future confusion, the Court requires
that all initiatory pleadings state the actions nature both in its
caption and body. Otherwise, the initiatory pleading may, upon
motion or by order of the court motu proprio, be dismissed
without prejudice to its re-filing after due rectification. This last
procedural rule is prospective in application.
5.
All existing rules inconsistent with the foregoing are
deemed superseded.

15

Decision

G.R. No. 202664

SO ORDERED.
,,.a,~

ESTELA M~HERLAS-BERNABE
Associate Justice
WE CONCUR:

MARIA LOURDES P.A. SERENO

Chief Justice

"'
PRESBITER~

ANTONIO T. CARPIO
Associate Justice

J. VELASCO, JR.
Ass)ciate Justice

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TERESITA J. LEONARDO-DE CASTRO

Associate Justice

On Leave
ARTURO D. BRION
Associate Justice

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Associate Justice

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On Leave
JOSE CATRAL MENDOZA
Associate Justice

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Associate Justice

Associate Justice

Associate Justice

Decision

G.R. No. 202664

16

CERTIFICATION
I certify that the conclusions in the above Decision had been reached
in consultation before the case was assigned to the writer of the opinion of
the Court.

MARIA LOURDES P.A. SERENO

Chief Justice

-~

/._,~_

CERTIFIED XEROX COPY:

~~~;~
CLERK OF COll~~ ~, EN BANC
SUPREME COURT