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Docket and filing fees in relation to subject-matter jurisdiction

For purposes of legal research of the readers, below is a recent Reply that I had filed in a
civil case involving the issue of nonpayment of additional docket and filing fees in
relation to acquisition by the court of subject-matter jurisdiction over the said case. It
involved an amended complaint with new/additional financial prayers, which had been
admitted by the court. The readers will find the citations therein useful for research
purposes. References to the case number, caption and parties in the said civil case have
been omitted.

REPLY

(In Re: UNPAID ADDITIONAL DOCKET FEES

and JURISDICTIONAL ISSUES)

THE DEFENDANTS, by counsel, respectfully state:

1. The new prayer in the AMENDED COMPLAINT is reproduced below en toto,

thus:

X x x.

WHEREFORE, premises considered, it is respectfully prayed that after

due hearing judgment be rendered as to the principal cause of action:

a) Ordering defendant xxx to execute the deed of sale in

favor of the plaintiff over the house and lot located at xxx
Las Pinas City and covered by the Transfer Certificate of
Title No. xxx of the registry of Deeds of Las Pinas City;
b) Ordering defendant xxx to pay plaintiff the following
amount:
i) P300,000.00, as moral damages;
ii) P200,000.00, as exemplary damages;
iii) P100,000.00, as attorneys fees; and
iv) To pay the costs of suit:

In the alternative, judgment be rendered:

a) Ordering defendant xxx to pay plaintiff the following

sums:
i) P1,351,265.66 representing reimbursement to the
plaintiff for the expenses of the renovations and
Improvements, insurance premiums, real property taxes
homeowners association dues and payment for compromise
settlement on the property in question, plus legal interest
thereof from the date of the filing of the complaint:
ii) P55,000.00, representing the funeral expenses of
defendant xxx minor son, xxx, plus legal interest thereof
from the filing of the complaint:
 b) Ordering defendants xxx and xxx to pay plaintiff jointly
and severally the following:
i) P1,414,928.20, representing reimbursement to the
plaintiff for the payment of defendant xxx car, including
the insurance thereof, as well as payment for the debts and
loans incurred by defendant xxx son, herein defendant xxx,
plus legal interest thereof from the filing of the complaint:
ii) P1,000,000.00 representing reimbursement to the
plaintiff for the support of defendant xxx eldest son, herein
defendant xxx:

iii) P2,105,000.00, representing rentals payments from

August 2001 to October 2006 for the business xxx
Enterprise, which was set up by the plaintiff for defendant
xxx, plus legal interest thereof from the filing of the
complaint:

iv) P100,000.00, as attorneys fees.

Plaintiff prays for such other relief as may be just and equitable in
the premises.

X x x.

2. The defendants URGENT MOTION (In Re: the Recently Admitted Amended
Complaint) argues and prays as follows:

x x x.

THE DEFENDANTS, by counsel, respectfully manifest that

although they did not object to the admission of the plaintiffs
amended complaint on the ground that the defendants likewise
intended to file an amended answer, nonetheless, it has now come
to the mind of the undersigned counsel that, pursuant to Sec. 7 of
Rule 141 (legal fees), there is a need for an order commanding the
plaintiff to first pay the mandatory and jurisdictional docket and
filing fees to validate the admission of the plaintiffs amended
complaint, more so, if the Court would consider the fact that the
new/additional financial prayers stated in the plaintiffs amended
complaint exceeded P6 Million, an amount which requires the
payment of a total amount of P116, 500.00 as docket and filing
fees, per the off-hand computation of the undersigned counsel
(subject to mathematical confirmation by the branch clerk of
court).

Although the defendants, thru counsel, are ready to file their amended answer to the
amended complaint within 10 days from its approval during the motion hearing on
November 9, 2007, i.e., to end on November 19, 2007, however, in fairness to the fiscal
needs of the State and the Judiciary and to give due respect to prevailing doctrines on
docket/filing fees and jurisdiction, the defendants hereby respectfully move that an order
be issued:

(a) DEFERING the filing by the defendants of their

amended answer;
 (b) SUSPENDING all proceedings of the instant case
arising from the recent admission of the amended
complaint; and

(c) COMMANDING the plaintiff to first submit to the

Court the original or the certified copies of the Official
Receipts issued by the Office of the Clerk of Court (OCC)
showing the actual payment by the plaintiff of the
mandatory and jurisdictional docket and filing fees,
pursuant to the abovecited provision of Rule 141 as a
procedural and jurisdictional precondition for the revival of
the proceedings of the instant suit.

3. The relevant doctrine enunciated by the Supreme Court in the case of

MARIO RODIS MAGASPI, et. al. vs. HONORABLE JOSE R.
RAMOLETE, Judge of the Court of First Instance of Cebu, et. al., G.R.
No. L-34840, July 20, 1982, is reproduced extensively below in
support of the defendants aforecited motion. Inter alia, it held that it
is a rule that the correct docket fee must be paid before the Court will
act on the petition or complaint; that the court is not called upon to act
on a complaint or a petition in the absence of payment of a
corresponding docket fee; that when a pleading is amended, the
original pleading is deemed abandoned; that the original ceases to
perform any further function as a pleading; that the case stands for trial
on the amended pleading only; that the additional docket fee to be paid
by the petitioners should be based on their amended complaint. THUS:

x x x.

This is a petition for certiorari to review the actuations of the Court

of First Instance of Cebu in Civil Case No.R-11882 in respect of
the correct amount to be paid for the filing of the case as provided
in Sec. 5, par. (a), Rule 141 of the Rules of Court.

On September 16, 1970, the petitioners filed a complaint for the

recovery of ownership and possession of a parcel of land with
damages against The Shell Co. of the Philippines, Ltd. and/or The
Shell Refining Co. (Phil.) Inc., Central Visayan Realty &
Investment Co., Inc. and Cebu City Savings & Loan Association in
the Court of First Instance of Cebu. Upon filing and the payment
of P60.00 as docketing fee and P10.00 for sheriff fees, the
complaint was assigned Civil Case No. R11882.

X x x.

On September 18, 1970, Central Visayan Realty & Investment Co.,

Inc. and Cebu City Savings and Loan Assn. filed a motion to
compel the plaintiffs to pay the correct amount for docket fee. X x
x.

The motion was opposed by the plaintiffs (petitioners herein) who

claimed that the main cause of action was the recovery of a piece
of land and on the basis of its assessed valued, P60.00 was the
correct docketing fee and that although the Revised Rules of Court
do not exclude damages in the computation of the docket fee,
damages are nonetheless still to be excluded.
On October 5, 1970, the presiding judge ordered the Clerk of Court
to comment on the motion and the opposition. The following
comment was submitted:

1. That in the matter of fixing the amount of fees

that shall be collected by the Clerks of Court of
First Instance for the filing of an action or
proceeding, Section 5, Rule 141 of the Rules of
Court provides as follows:

Sec. 5. Clerks of Court of First Instance.

(a) For filing an action or proceeding, or a
permissive counterclaim or crossclaim not
arising out of the same transaction subject of
the complaint, a third-party complaint and a
complaint in intervention and for all services
in the same, if the sum claimed, exclusive of
interest, or the value of the property in
litigation, or the value of the estate, is: x x x
(omitted)

X x x.

If the case concerns real estate, the assessed

value thereof shall be considered in
computing the fees. (Emphasis supplied)

In case the value of the property or estate of

the sum claimed is less or more in
accordance with the appraisal of the court,
the difference of fee shall be refunded or
paid as the case may be.

2. That a reading of the complaint in this case

would show that the action is not only for recovery
of property but also for actual and moral damages
as well as for attorney's fees;

3. That under the provisions of Sec. 5, Rule 141 of

the Rules of Court, already cited above, it appears
that for the purpose of determining the amount of
the fees that should be collected for the filing of an
action or proceeding, the basis should be the totality
of the sum or sums claimed, exclusive of interest,
except in the case of real estate where the assessed
value thereof shall be considered in computing the
fees;

x x x.

Xxx.

On November 3, 1970, the plaintiffs filed a motion for leave to

amend the complaint so as to include the Government of the
Republic of the Philippines as a defendant.
On November 12, 1970, the defendants (herein respondents filed
an opposition to the admission of the amended complaint. They
based their opposition on the following grounds:

1. That while the only reason given for the amendment of the
complaint is the inclusion of the Government of the Philippines as
an indispensable party; the plaintiffs have taken the improper
liberty of amending portions of the allegations in the complaint and
even has eliminated entire paragraph, thus:

a) By not mentioning the previously alleged value of the land at

P1,250,000.00 in paragraph 19;

b) By not mentioning the previously averred to monthly rentals due

at P3,500.00 from June 2, 1948, or computed at P890,633.24;

c) By eliminating completely the claim for moral damages of

P500.000.00 and reducing attorney's fees from P250,000.00 to
P100,000.00 under par. 21;

d) By not mentioning the amount previously claimed as exemplary

damages in the sum of P500,000.00, as alleged in par. 21:

substituting thereto, the averment that, the amount of these various

claims for damages will be proven during the trial of the case;

2. That these amendments are obviously intended to circumvent, it

not entirely subvert, the lawful Order of this Honorable Court for
the plaintiff to pay the amount of P3,104.00 as docket fee, on the
basis of the total amount claimed for damages (plus Pl,000.00
docket fee on the P500,000.00 exemplary damages, pending
resolution before this Honorable Court);

3. That if the amended complaint is admitted as it is, plaintiffs

would effect, have their cakes and eat it too, in the manner of
speaking;

4. That the payment of the correct and in this case, by an Order of

this Honorable Court of the docket fee, is a condition precedent for
the complaint, amended or otherwise, of the plaintiff to be given
due course;

On November 16, 1970, Judge Canonoy admitted the amended

complaint although the plaintiffs had not yet complied with his
Order of October 14, 1970, that they should pay an additional
P3,104.00 docket fee.

X x x.

It is a rule that the correct docket fee must be paid before the Court
will act on the petition or complaint. The Court of Justice is not
called upon to act on a complaint or a petition in the absence of
payment of a corresponding docket fee. (Garcia vs. Vasquez, 28
SCRA 330, 331.) Before the payment of the docket fee, the case is
not deemed registered and docketed (Lazaro vs. Endencia, 57
 Phil., 552; Malimit vs. Degamo, 12 SCRA 454; Lee vs. Republic,
10 SCRA, 67).

In the light of the above rulings on the matter, the original

complaint, up to the present, is not deemed registered or docketed.
It follows, therefore, that there is likewise no amended complaint
deemed to have been filed and admitted.

The Court, therefore, is of the view that up to the present the

parties are in the same situation as they were before this
proceeding was started. It cannot also order the plaintiffs to
comply with the order of this Court dated October 14, 1970,
because it has not yet acquired jurisdiction over them neither can it
order the dismissal of the complaint for non-compliance of the
order of October 14, 1970, by the plaintiffs, for obvious reasons.
The plaintiffs are given the choice to pay the docket fee assessed or
to forego this proceeding.

The petitioners assail the above order. They insist that they had
correctly paid the docketing fee in the amount of P60.00, or in the
alternative, that if they are to pay an additional docketing fee, it
should be based on the amended complaint.

X x x.

The next question is in respect of the correct amount to be paid as

docket fee. Judge Canonoy on October 14, 1970, ordered the
payment of P3,104.00 as additional docket fee based on the
original complaint. However, the petitioners assert as an alternative
view, that the docket fee be based on the amended complaint
which was admitted on November 14, 1970, also by Judge
Canonoy.

The petitioners have a point. "When a pleading is amended, the

original pleading is deemed abandoned. The original ceases to
perform any further function as a pleading. The case stands for trial
on the amended pleading only. " (1 Moran, Rules of Court, 363
119701, citing Reynes v. Compania General de Tobacos de
Filipinas, 21 Phil. 417; Reyman v. Director of Lands, 34 Phil,
428.)

On the basis of the foregoing, the additional docket fee to be paid

by the petitioners should be based on their amended complaint.

WHEREFORE, the petition is hereby granted: the petitioners shall

be assessed a docket fee on the basis of the amended complaint;
and after all of the lawful fees shall have been paid, the
proceedings in Civil Case No. R-11882 shall be resumed. No
special pronouncement as to costs.

SO ORDERED.

2. In the case of Sunlife Insurance Office, Ltd. v. Asuncion, 170 SCRA 274, 285,
February 13, 1989, iut was held, thus: Where the filing of the initiatory
pleading is not accompanied by payment of the docket fee, the court may
allow payment of the fee within a reasonable time but in no case beyond the
 applicable prescriptive or reglementary period. (see also: Ayala Corporation
v. Madayag, 181 SCRA 687, 689, January 30, 1990).

In the case at bar, the defendants in effect fairly moved that the plaintiff be given
a reasonable time to pay the additional jurisdictional docket fees.

3. The receipts attached to the plaintiffs opposition to the defendants motion

show only the old/original 2006 docket fees paid by her, not the new
additional fees based on her new/amended/additional financial prayers, as
prayed for by the defendants, per Rule 141.

4. Although the instant case appears to be a personal action (specific performance

and damages), nonetheless, the subject matter of this case basically is a real
property, and although the defendants had not originally raised the issued of
jurisdiction in a motion to dismiss based on nonpayment of docket, at any
rate, it is instructive to cite the spirit of the case of MANUEL M. SERRANO,
petitioner, vs. EUGENIO C. DELICA, respondent., G.R. No. 136325. July 29,
2005., it was held, thus::

X x x.

On the first issue, we cannot overemphasized the importance of paying the

correct docket fees. Such fees are intended to take care of court expenses
in the handling of cases in terms of cost of supplies, use of equipment,
salaries and fringe benefits of personnel, etc., computed as to man-hours
used in the handling of each case. The payment of said fees, therefore,
cannot be made dependent on the result of the action taken, without
entailing tremendous losses to the government and to the judiciary in
particular.[3]

Thus, the rule is that upon the filing of the pleading or other application
which initiates an action or proceeding, the fees prescribed therefor shall
be paid in full.[4] However, a litigant who is a pauper is exempt from the
payment of the docket fees. But the fees shall be a lien on the judgment
rendered in favor of said pauper litigant, unless the court otherwise
provides.[5]

It is not simply the filing of the complaint or appropriate initiatory

pleading, but the payment of the prescribed docket fees that vests a trial
court with jurisdiction over the subject matter or nature of the action.[6]

In the case at bar, petitioner impugns the Court of Appeals ruling that
respondents complaint in Civil Case No. 97-120 is not capable of
pecuniary estimation and that, therefore, the docket fee is fixed at P600.00
pursuant to Section 7(b)(1), Rule 141 of the Revised Rules of Court.

We agree with petitioner that the Court of Appeals erred in issuing such
ruling. It should have considered the allegations of the complaint and the
character of the reliefs sought, the criteria in determining the nature of an
action.[7]

A careful examination of respondents complaint is that it is a real action.

In Paderanga vs. Buissan,[8] we held that in a real action, the plaintiff
seeks the recovery of real property, or, as stated in Section 2(a), Rule 4 of
the Revised Rules of Court,[9] a real action is one affecting title to real
 property or for the recovery of possession of, or for partition or
condemnation of, or foreclosure of a mortgage on a real property.

Obviously, respondents complaint is a real action involving not only the recovery of real
properties, but likewise the cancellation of the titles thereto.

Considering that respondents complaint is a real action, the Rule requires

that the assessed value of the property, or if there is none, the estimated
value thereof shall be alleged by the claimant and shall be the basis in
computing the fees.[10]

We note, however, that neither the assessed value nor the estimated
value of the questioned parcels of land were alleged by respondent in
both his original and amended complaint. What he stated in his amended
complaint is that the disputed realties have a BIR zonal valuation of
P1,200.00 per square meter. However, the alleged BIR zonal valuation
is not the kind of valuation required by the Rule. It is the assessed value of
the realty.[11] Having utterly failed to comply with the requirement of the
Rule that he shall allege in his complaint the assessed value of his real
properties in controversy, the correct docket fee cannot be computed. As
such, his complaint should not have been accepted by the trial court. We
thus rule that it has not acquired jurisdiction over the present case for
failure of herein respondent to pay the required docket fee. On this ground
alone, respondents complaint is vulnerable to dismissal.

X x x.

5. The defendants extensively quotes below the case of VIRGINIA GOCHAN,

et.al. vs. MERCEDES GOCHAN, et. al., G.R. No. 146089, December 13,
2001, which, inter alia, held that the liberal interpretation of the rules relating
to the payment of docket fees as applied in the case of Sun Insurance could
not apply in a case where the respondents had never demonstrated any
willingness to abide by the rules and to pay the correct docket fees and where
the respondents had stubbornly insisted that the case they filed was one for
specific performance and damages and that they had allegedly actually paid
the correct docket fees therefor at the time of the filing of the complaint.

X x x.

The rule is well-settled that the court acquires jurisdiction over any
case only upon the payment of the prescribed docket fees. In the
case of Sun Insurance Office, Ltd. (SIOL) v. Asuncion, this Court
held that it is not simply the filing of the complaint or appropriate
initiatory pleading, but the payment of the prescribed docket fee
that vests a trial court with jurisdiction over the subject matter or
nature of the action.

X x x.

It is necessary to determine the true nature of the complaint in

order to resolve the issue of whether or not respondents paid the
correct amount of docket fees therefor. In this jurisdiction, the
dictum adhered to is that the nature of an action is determined by
the allegations in the body of the pleading or complaint itself,
rather than by its title or heading. The caption of the complaint
below was denominated as one for specific performance and
 damages. The relief sought, however, is the conveyance or
transfer of real property, or ultimately, the execution of deeds of
conveyance in their favor of the real properties enumerated in the
provisional memorandum of agreement. Under these
circumstances, the case below was actually a real action, affecting
as it does title to or possession of real property.

In the case of Hernandez v. Rural Bank of Lucena, this Court held

that a real action is one where the plaintiff seeks the recovery of
real property or, as indicated in section 2(a) of Rule 4 (now Section
1, Rule 4 of the 1997 Rules of Civil Procedure), a real action is an
action affecting title to or recovery of possession of real property.

It has also been held that where a complaint is entitled as one for
specific performance but nonetheless prays for the issuance of a
deed of sale for a parcel of land, its primary objective and nature is
one to recover the parcel of land itself and, thus, is deemed a real
action. In such a case, the action must be filed in the proper court
where the property is located:

In this Court, the appellant insists that her action is one for specific
performance, and, therefore, personal and transitory in nature.

This very issue was considered and decided by this Court in the
case of Manuel B. Ruiz vs. J.M. Tuason & Co., Inc. et al., L-18692,
promulgated 31 January 1963. There the Court, by unanimous vote
of all the Justices, held as follows:

This contention has no merit. Although appellants complaint is entitled to be one for
specific performance, yet the fact that he asked that a deed of sale of a parcel of land
situated in Quezon City be issued in his favor and that a transfer certificate of title
covering said parcel of land be issued to him shows that the primary objective and nature
of the action is to recover the parcel of land itself because to execute in favor of appellant
the conveyance requested there is need to make a finding that he is the owner of the land
which in the last analysis resolves itself into an issue of ownership. Hence, the action
must be commenced in the province where the property is situated pursuant to Section 3,
Rule 5, of the Rules of Court, which provides that actions affecting title

to or recovery of possession of real property shall be commenced and tried in the

province where the property or any part thereof lies.

In the case at bar, therefore, the complaint filed with the trial court
was in the nature of a real action, although ostensibly denominated
as one for specific performance. Consequently, the basis for
determining the correct docket fees shall be the assessed value of
the property, or the estimated value thereof as alleged by the
claimant. Rule 141, Section 7, of the Rules of Court, as amended
by A.M. No. 00-2-01-SC, provides:

Section 7. Clerks of Regional Trial Courts. - x x x

(b) xxx

In a real action, the assessed value of the property, or if

there is none, the estimated value thereof shall be alleged
 by the claimant and shall be the basis in computing the
fees.

We are not unmindful of our pronouncement in the case of Sun

Insurance, to the effect that in case the filing of the initiatory
pleading is not accompanied by payment of the docket fee, the
court may allow payment of the fee within a reasonable time but in
no case beyond the applicable prescriptive period. However, the
liberal interpretation of the rules relating to the payment of docket
fees as applied in the case of Sun Insurance cannot apply to the
instant case as respondents have never demonstrated any
willingness to abide by the rules and to pay the correct docket fees.
Instead, respondents have stubbornly insisted that the case they
filed was one for specific performance and damages and that they
actually paid the correct docket fees therefor at the time of the
filing of the complaint. Thus, it was stated in the case of Sun
Insurance:

The principle in Manchester could very well be applied in

the present case. The pattern and the intent to defraud the
government of the docket fee due it is obvious not only in
the filing of the original complaint but also in the filing of
the second amended complaint.

However, in Manchester, petitioner did not pay any

additional docket fee until the case was decided by this
Court on May 7, 1987. Thus, in Manchester, due to the
fraud committed on the government, this Court held that
the court a quo did not acquire jurisdiction over the case
and that the amended complaint could not have been
admitted inasmuch as the original complaint was null and
void.

In the present case, a more liberal interpretation of the rules is

called for considering that, unlike Manchester, private respondent
demonstrated his willingness to abide by the rules by paying the
additional docket fees as required. The promulgation of the
decision in Manchester must have had that sobering influence on
private respondent who thus paid the additional docket fee as
ordered by the respondent court. It triggered his change of stance
by manifesting his willingness to pay such additional docket fee as
may be ordered.

Xxx.

WHEREFORE, the defendants respectfully reiterate their motion to command the

plaintiff to first pay the proper additional docket fees based on her new/additional
financial prayers as stated in her admitted amended complaint and that in the meantime
the proceedings of this case be suspended, including the duty of the defendants to file
their joint amended answer.

Las Pinas City, December 12, 2007.

LASERNA CUEVA MERCADER LAW OFFICES

New Counsel for Defendants

Unit 15, Star Arcade, C.V. Starr Ave.

Philamlife Village, Las Pinas City 1743

Tel/Fax 8742539, 8725443

MANUEL J. LASERNA JR.

Roll No. 33640, 4/27/85

IBP Lifetime Member No. 1907

IBP PPLM Chapter

PTR No. 9400055, 1/5/07, Las Pinas

MCLE Exemption No. II-000844 (3/31/07)

Cc:

Co-Counsel for Plaintiff

EXPLANATION

A copy of this pleading is served on opposing counsel by registered mail due to the lack
of field staff of undersigned counsel at this time and the urgency of filing the same.

MANUEL J. LASERNA JR.