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G.R. No. 81006 May 12, 1989 WHEREFORE, judgment appealed from is hereby affirmed in toto.

VICTORINO C. FRANCISCO, petitioner, When the defendant went to the Court of Appeals, his petition for review was denied on
vs. September 29, 1987, as so too was his motion for reconsideration, on December 1,
WINAI PERMSKUL and THE HON. COURT OF APPEALS, respondents. 1987.4 He is now before us to fault the respondent court, principally for sustaining the
memorandum decision of the regional trial court. His contention is that it violates Article
An important constitutional question has been injected in this case which started out as an VIII, Section 14 of the Constitution.
ordinary complaint for a sum of money. The question squarely presented to the Court is
the validity of the memorandum decision authorized under Section 40 of B.P. Blg. 129 in This provision reads as follows:
the light of Article VIII, Section 14 of the Constitution.
Sec. 14. No decision shall be rendered by any court without expressing
On May 21, 1984, the petitioner leased his apartment in Makati to the private respondent therein clearly and distinctly the facts and the law on which it is based.
for a period of one year for the stipulated rental of P3,000.00 a month. Pursuant to the
lease contract, the private respondent deposited with the petitioner the amount of No petition for review or motion for reconsideration of a decision of the
P9,000.00 to answer for unpaid rentals or any damage to the leased premises except court shall be refused due course or denied without stating the legal basis
when caused by reasonable wear and tear. On May 31, 1985, the private respondent therefor.
vacated the property. He thereafter requested the refund of his deposit minus the sum of
P1,000.00, representing the rental for the additional ten days of his occupancy after the Except for the second paragraph, which was introduced only in the present charter,
expiration of the lease. The petitioner rejected this request. He said the lessee still owed Section 14 has been in force since the Constitution of 1935. The provision was recast in
him for other charges, including the electricity and water bills and the sum of P2,500.00 for affirmative terms in the 1973 Constitution but has been virtually restored to its original form
repainting of the leased premises to restore them to their original condition.1 in the Constitution of 1987, to apply to all courts, including the municipal courts. The
purpose has always been the same, viz., to inform the person reading the decision, and
The private respondent sued in the Metropolitan Trial Court of Makati. After the especially the parties, of how it was reached by the court after consideration of the
submission of position papers by the parties, a summary judgment was rendered on pertinent facts and examination of the applicable laws.
October 11, 1985, sustaining the complainant and holding that the repainting was not
chargeable to him. The defendant was ordered to pay the plaintiff the amount of The parties are entitled to no less than this explanation if only to assure them that the
P7,750.00, representing the balance of the deposit after deducting the water and court rendering the decision actually studied the case before pronouncing its judgment.
electricity charges. The plaintiff was also awarded the sum of P1,250.00 as attorney's But there are more substantial reasons. For one thing, the losing party must be given an
fees, plus the Costs.2 opportunity to analyze the decision so that, if permitted, he may elevate what he may
consider its errors for review by a higher tribunal. For another, the decision, if well-
This decision was appealed to the Regional Trial Court of Makati and was affirmed by presented and reasoned, may convince the losing party of its merits and persuade it to
Judge Jose C. de la Rama on January 14, 1987. This was done in a memorandum accept the verdict in good grace instead of prolonging the litigation with a useless appeal.
decision reading in full as follows: A third reason is that decisions with a full exposition of the facts and the law on which they
are based, especially those coming from the Supreme Court, will constitute a valuable
MEMORANDUM DECISION body of case law that can serve as useful references and even as precedents in the
resolution of future controversies. As the Court said in Rosales v. Court of First Instance. 5
After a careful and thorough perusal, evaluation and study of the records of
this case, this Court hereby adopts by reference the findings of fact and Precedents are helpful in deciding cases when they are on all fours or at
conclusions of law contained in the decision of the Metropolitan Trial Court least substantially Identical with previous litigations. Argumentum a simili
of Makati, Metro Manila, Branch 63 and finds that there is no cogent valet in lege. Earlier decisions are guideposts that can lead us in the right
reason to disturb the same. direction as we tread the highways and byways of the law in the search for
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truth and justice. These pronouncements represent the wisdom of the past. contains verbatim the dispositive portion of the decision appealed from.
They are the voice of vanished judges talking to the future. Except where The remaining page is devoted to an explanation of why "for judicial
there is a need to reverse them because of an emergent viewpoint or an convenience and expediency, therefore, We hereby adopt, by way of
altered situation, they urge us strongly that, indeed, the trodden path is reference, the findings of facts and conclusions of the court a quo spread
best. in its decision, as integral part of this Our decision." The said decision may
be considered as substantial compliance with the above-quoted provisions
According to the petitioner, the memorandum decision rendered by the regional trial court in Section 18 of P.D. No. 946 and Section 40 of B.P. Blg. 129.
should be revoked for non-compliance with the above-quoted constitutional mandate. He
asks that the case be remanded to the regional trial court for a full blown hearing on the Nevertheless, he was quick to add a tenable misgiving and to express the following
merits, to be followed by a decision stating therein clearly and distinctly the facts and the reservation:
law on which it is based. For his part, the private respondent demurs. He justifies the
memorandum decision as authorized by B.P. Blg. 129 and invokes the ruling of this Court The authority given the appellate court to adopt by reference the findings
in Romero v. Court of Appeals, 6 Which sustained the said law. of fact and conclusions of law from those set forth in the appealed
decisions should be exercised with caution and prudence, because the
Section 40 of B.P. Blg. 129 reads as follows: tendency would be to follow the line of least resistance by just adopting the
findings and conclusions of the lower court without thoroughly studying the
Sec. 40. Form of decision in appealed cases. — Every decision or final appealed case.
resolution of a court in appealed cases shall clearly and distinctly state the
findings of fact and the conclusions of law on which it is based which may This caveat was necessary because, as he correctly observed:
be contained in the decision or final resolution itself, or adopted by
reference from those set forth in the decision, order or resolution appealed It cannot be too strongly emphasized that just as important as the intrinsic
from. validity of a decision is the perception by the parties-litigants that they have
been accorded a fair opportunity to be heard by a fair and responsible
The above section was applied in the Romero case, together with a similar rule embodied magistrate before judgment is rendered. It is this perception, coupled with
in Section 18 of P.D. No. 946, providing that: a clear conscience, which enables the members of the judiciary to
discharge the awesome responsibility of sitting in judgment on their
All cases of the Court of Agrarian Relations now pending before the Court fellowmen.
of Appeals shall remain in the Division to which they have been assigned,
and shall be decided within sixty (60) days from the effectivity of this There is no question that the purpose of the law in authorizing the memorandum decision
Decree; Provided, however, That if the decision or order be an is to expedite the termination of litigations for the benefit of the parties as well as the
affirmance in toto of the dispositive conclusion of the judgment appealed courts themselves.
from, then the Court of Appeals may, instead of rendering an extended
opinion, indicate clearly the trial court's findings of fact and Concerned with the mounting problem of delay in the administration of justice, the
pronouncements of law which have been adopted as basis for the Constitution now contains a number of provisions aimed at correcting this serious difficulty
affirmance. that has caused much disaffection among the people. Thus, Section 16 of the Bill of
Rights reiterates the original provision in the 1973 Constitution guaranteeing to all persons
In the said case, Justice Jose Y. Feria, speaking for a unanimous Court, declared: "the right to a speedy disposition of their cases before all judicial, quasi-judicial or
administrative bodies." Section 14(2) of the same Article III retains the rule that the
As previously stated, the decision of the Court of Agrarian Relations accused shall be entitled to a trial that shall not only be public and impartial but also
consisted of thirteen pages, single space. The above-quoted decision of speedy. In Article VIII, Section 5(3), the Supreme Court is expressly permitted to
the respondent Court of Appeals consists of four pages, three of which temporarily assign a judge from one station to another when the public interest so
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requires, as when there is a necessity for less occupied judge to help a busier colleague required by the Constitution, his memorandum decision was a total nullity. Worse, when
dispose of his cases. In paragraph 5 of the same section, it is stressed that the rules of the appeal was taken to the respondent court, what it reviewed was not the memorandum
court to be promulgated by the Supreme Court "shall provide a simplified and inexpensive decision of the regional trial court but the decision rendered by the metropolitan trial court
procedure for the speedy disposition of cases." In Section 15, of the same article, which, legally speaking, was not before the appellate court.
maximum periods are prescribed for the decision or resolution of cases, to wit, twenty-four
months in the case of Supreme Court and, unless reduced by the Supreme Court, twelve It is not really correct to say that the Court of Appeals did not review the memorandum
months for all lower collegiate courts and three months for all other lower courts. decision of the regional trial court which was the subject of the petition for review. A
reading of its own decision will show that it dealt extensively with the memorandum
The courts of justice are really hard put at coping with the tremendous number of cases in decision and discussed it at some length in the light of the observations — and
their dockets which, to make matters worse, continues to grow by the day despite the reservations — of this Court in the Romero case. Moreover, in reviewing the decision of
efforts being taken to reduce it. In the Supreme Court alone, an average of 400 cases is the metropolitan trial court, the Court of Appeals was actually reviewing the decision of the
received every month as against the average of 300 cases disposed of during the same regional trial court, which had incorporated by reference the earlier decision rendered by
month, leaving a difference of 100 cases monthly that is added to some 5,000 still Judge Balita.
unresolved cases that have accumulated during the last two decades or so. At this rate,
the backlog will increase by 1,200 cases every year on top of the earlier balance, much of The question, of course, is whether such incorporation by reference was a valid act that
which, despite its age, is still viable and have still to be resolved. Considering that the effectively elevated the decision of the metropolitan trial court for examination by the Court
Court spends four days of the week for studying and deliberating on these cases in its en of Appeals.
banc and division sessions, one can appreciate the limited time allowed its members for
the actual writing of its decisions. (This particular decision, while extended, happens To be fair, let it be said that when Judge dela Rama availed himself of the convenience
fortunately to be less complicated than many of the other cases submitted to it, which offered by Section 40 of B.P. Blg. 129, he was only acting in accordance with the ruling
require more time to write, not to mention the antecedent research that may have to be announced in Romero permitting the use of the memorandum decision. It must also be
made.) observed that even if the respondent court appeared to be partial to the reservation rather
than the rule in the said case, it nevertheless had the duty — which it discharged — to
Viewed in the light of these practical considerations, the memorandum decision can be abide by the doctrine announced therein by the highest tribunal of the land. The
welcomed indeed as an acceptable method of dealing expeditiously with the case load of respondent court could not have acted otherwise.
the courts of justice, But expediency alone, no matter how compelling, cannot excuse non-
compliance with the Constitution; or to put it more familiarly, the end does not justify the This Court is not hampered by such inhibitions. As we may re-examine our own rulings
means. It is plain that if Section 40 of B.P. Blg. 129 is unconstitutional, it must be struck and modify or reverse them whenever warranted, we take a second look at the
down. memorandum decision and the Romero case and test them on the touchstone of the
Constitution.
In the case at bar, we find that a judgment was made by the metropolitan trial court in
compliance with the rule on summary procedure. The decision consisted of three The law does not define the memorandum decision and simply suggests that the court
typewritten pages, single space, and stated clearly and distinctly the facts and the law on may adopt by reference the findings of fact and the conclusions of law stated in the
which it was based. It was a concise and well-written decision, and a correct one to boot, decision, order or resolution on appeal before it. No particular form is prescribed; the
for which Judge Paciano B. Balita is to be commended. conditions for its use are not indicated. In fact, B.P. Blg. 129 does not even employ the
term "memorandum decision" in Section 40 or elsewhere in the rest of the statute. This
The problem, though, as the petitioner sees it, is that in affirming this judgment, the phrase appears to have been introduced in this jurisdiction not by that law but by Section
regional trial court of Makati rendered a mere memorandum decision that simply adopted 24 of the Interim Rules and Guidelines, reading as follows:
by reference the findings of fact and law made by Judge Balita and then concluded,
without saying more, that "there was no cogent reason to disturb the same." It is claimed
that as Judge de la Rama did not make his own statement of the facts and the law as

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Sec. 24. Memorandum decisions. — -The judgment or final resolution of a What is questioned about the law is the permission it gives for the appellate court to
court in appealed cases may adopt by reference the findings of fact and merely adopt by reference in its own decision the judgment of the lower court on appeal. It
conclusions of law contained in the decision or final order appealed from. is easy to understand that this device may feed the suspicion feared by Justice Feria that
the court has not given the appeal the attention it deserved and thus deprived the parties
It is clear that where the decision of the appellate court actually reproduces the findings of of due process. True or not, this impression is likely to undermine popular faith in the
fact or the conclusions of law of the court below, it is not a memorandum decision as judiciary as an impartial forum which hears before it decides and bases its decision on the
envisioned in the above provision. The distinctive features of the memorandum decision established facts and the applicable law.
are, first, it is rendered by an appellate court, and second, it incorporates by reference the
findings of fact or the conclusions of law contained in the decision, order or ruling under No less objectionable is the inconvenience involved in having to search for the decision
review. Most likely, the purpose is to affirm the decision, although it is not impossible that referred to, which, having been incorporated by reference only, does not have to be
the approval of the findings of fact by the lower court may lead to a different conclusion of attached to the memorandum decision. The Court had occasion earlier to complain about
law by the higher court. At any rate, the reason for allowing the incorporation by reference this difficulty in the case of Gindoy v. Tapucar, 8 where we said:
is evidently to avoid the cumbersome reproduction of the decision of the lower court, or
portions thereof, in the decision of the higher court. The Idea is to avoid having to repeat in . . . True it is that the Court of First Instance may adopt in toto either
the body of the latter decision the findings or conclusions of the lower court since they are expressly or impliedly the findings and conclusions of the inferior court,
being approved or adopted anyway. and as a rule, such adoption would amount to a substantial compliance
with the constitutional mandate discussed herein, but where, as in this
Parenthetically, the memorandum decision is also allowed in the United States, but its case, the specific arguments presented against the decision of the inferior
form (at least) differs from the one under consideration in this case. Such a decision is court are of such nature that a blanket affirmance of said decision does not
rendered in that country upon a previous' determination by the judge that there is no need in fact adequately dispose of the strictures against it, it is but proper, if only
for a published opinion and that it will have no precedential effect. The judgment is usually to facilitate the action to be taken by the appellate court on the petition for
limited to the dispositive portion but a memorandum is attached containing a brief review, that the concrete bases of the impugned decision should appear
statement of the facts and the law involved, mainly for the information of the parties to the on its face, instead of the appellate court having to dig into the records to
case. find out how the inferior court resolved the issues of the case.

When a law is questioned before the Court, we employ the presumption in favor of its As to this problem, the Solicitor General correctly points out that it does not exist in the
constitutionality. As we said in Peralta v. Commission of Elections, "to justify the case at bar because the decision of the Court of Appeals extensively quoted from the
nullification of a law, there must be a clear and unequivocal breach of the Constitution, not decision of the metropolitan trial court. Although only incorporated by reference in the
a doubtful and argumentative implication."7 Courts will bend over backward to sustain that memorandum decision of the regional trial court, Judge Balita's decision was nevertheless
presumption. In case of doubt, it is the duty of the judiciary to exert every effort to prevent available to the Court of Appeals. It is this circumstance, or even happenstance, if you will,
the invalidation of the law and the nullification of the will of the legislature that enacted it that has validated the memorandum decision challenged in this case and spared it from
and the executive that approved it. This norm is based on a becoming respect that the constitutional infirmity.
judiciary is expected to accord the political departments of the government which, it must
be assumed in fairness, thoroughly studied the measure under challenge and assured That same circumstance is what will move us now to lay down the following requirement,
themselves of its constitutionality before agreeing to enact it. as a condition for the proper application of Section 40 of B.P. Blg. 129. The memorandum
decision, to be valid, cannot incorporate the findings of fact and the conclusions of law of
The Court has deliberated extensively on the challenge posed against the memorandum the lower court only by remote reference, which is to say that the challenged decision is
decision as now authorized by law. Taking into account the salutary purpose for which it is not easily and immediately available to the person reading the memorandum decision. For
allowed, and bearing in mind the above-discussed restraint we must observe when a law the incorporation by reference to be allowed, it must provide for direct access to the facts
is challenged before us, we have come to the conclusion that Section 40 of B.P. Blg. 129, and the law being adopted, which must be contained in a statement attached to the said
as we shall interpret it here, is not unconstitutional. decision. In other words, the memorandum decision authorized under Section 40 of B.P.

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Blg. 129 should actually embody the findings of fact and conclusions of law of the lower The interpretation we make today will not apply retroactively to the memorandum decision
court in an annex attached to and made an indispensable part of the decision. rendered by the regional trial court in the case at bar, or to the decision of the respondent
court such decision on the strength of Romero v. Court of Appeals. As earlier observed,
It is expected that this requirement will allay the suspicion that no study was made of the there was substancial compliance with Section 40 because of the direct availability and
decision of the lower court and that its decision was merely affirmed without a proper actual review of the decision of Judge Balita incorporated by reference in the
examination of the facts and the law on which it was based. The proximity at least of the memorandum decision of Judge de la Rama. The memorandum decision as then
annexed statement should suggest that such an examination has been undertaken. It is, understood under the Romero decision was a valid act at the time it was rendered by
of course, also understood that the decision being adopted should, to begin with, comply Judge de la Rama and produced binding legal effect. We also affirm the finding of the
with Article VIII, Section 14 as no amount of incorporation or adoption will rectify its respondent court that the summary judgment without a formal trial was in accord with the
violation. Rule on Summary Procedure and that the award of attorney's fees is not improper.

The Court finds it necessary to emphasize that the memorandum decision should be Henceforth, all memorandum decisions shall comply with the requirements herein set forth
sparingly used lest it become an addictive excuse for judicial sloth. It is an additional both as to the form prescribed and the occasions when they may be rendered. Any
condition for its validity that this kind of decision may be resorted to only in cases where deviation will summon the strict enforcement of Article VIII, Section 14 of the Constitution
the facts are in the main accepted by both parties or easily determinable by the judge and and strike down the flawed judgment as a lawless disobedience.
there are no doctrinal complications involved that will require an extended discussion of
the laws involved. The memorandum decision may be employed in simple litigations only, WHEREFORE, the petition is DENIED, with costs against the petitioner. This decision is
such as ordinary collection cases, where the appeal is obviously groundless and deserves immediately executory. It is so ordered.
no more than the time needed to dismiss it.

Despite the convenience afforded by the memorandum decision, it is still desirable that the
appellate judge exert some effort in restating in his own words the findings of fact of the
lower court and presenting his own interpretation of the law instead of merely parroting the
language of the court a quo as if he cannot do any better. There must be less intellectual
indolence and more pride of authorship in the writing of a decision, especially if it comes
from an appellate court.

It ill becomes an appellate judge to write his rulings with a pair of scissors and a pot of
paste as if he were a mere researcher. He is an innovator, not an echo. The case usually
becomes progressively simpler as it passes through the various levels of appeal and many
issues become unimportant or moot and drop along the way. The appellate judge should
prune the cluttered record to make the issues clearer. He cannot usually do this by simply
mimicking the lower court. He must use his own perceptiveness in unraveling the rollo and
his own discernment in discovering the law. No less importantly, he must use his own
language in laying down his judgment. And in doing so, he should also guard against
torpidity lest his pronouncements excite no more fascination than a technical tract on the
values of horse manure as a fertilizer. A little style will help liven the opinion trapped in the
tortuous lexicon of the law with all its whereases and wherefores. A judicial decision does
not have to be a bore.

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ONG CHIU KWAN, petitioner, vs. COURT OF APPEALS, and the PEOPLE OF THE On appeal to the Regional Trial Court, Bacolod City, the latter court in a decision dated
PHILIPPINES, respondents. December 8, 1992, simplistically adopted the decision of the lower court in toto, without stating
the reasons for doing so.[9]
What is before the Court for consideration is the decision of the Court of Appeals affirming
the conviction of accused Ong Chiu Kwan, for unjust vexation. [1] On April 22, 1993, by petition for review, Ong Chiu Kwan elevated the case to the Court of
Appeals.[10] On August 16, 1993, the Court of Appeals promulgated its decision dismissing the
On January 31, 1991, Assistant City Prosecutor Andres M. Bayona of Bacolod filed with appeal,[11] agreeing with the lower courts finding that petitioner was guilty beyond reasonable
the Municipal Trial Court, Bacolod City an information charging petitioner with unjust vexation doubt of unjust vexation.
for cutting the electric wires, water pipes and telephone lines of Crazy Feet, a business
establishment owned and operated by Mildred Ong.[2] Hence, this petition for review.[12]
On April 24, 1990, at around 10:00 in the morning, Ong Chiu Kwan ordered Wilfredo The Court notes that in the decision of the Regional Trial Court which the Court of
Infante to relocate the telephone, electric and water lines of Crazy Feet, because said lines Appeals affirmed peremptorily without noticing its nullity, the Regional Trial Court merely
posed as a disturbance.[3] However, Ong Chiu Kwan failed to present a permit from appropriate quoted the decision of the Municipal Trial Court in full and added two paragraphs, thus:
authorities allowing him to cut the electric wires, water pipe and telephone lines of the business
establishment.[4] This Court, in accordance with the rules, required the parties to submit their corresponding
After due trial, on September 1, 1992, the Municipal Trial Court found Ong Chiu Kwan memorandum or brief. The prosecution filed its memorandum, and also with the defense.
guilty of unjust vexation,[5] and sentenced him to imprisonment for twenty days. [6] The court
also ordered him to pay moral damages, finding that the wrongful act of abruptly cutting off the After a careful perusal of the record of the case and evaluating the evidence thereto and
electric, water pipe and telephone lines of Crazy Feet caused the interruption of its business exhibits thereof, this Court finds no ground to modify, reverse or alter the above-stated
operations during peak hours, to the detriment of its owner, Mildred Ong. The trial court also decision and hereby affirms the decision of the lower court in toto.[13]
awarded exemplary damages to complainant as a deterrent to the accused not to follow similar
act in the future and to pay attorneys fees.[7] The trial court disposed of the case as follows: The Constitution requires that [N]o decision shall be rendered by any court without
expressing therein clearly and distinctly the facts and the law on which it is based. [14] The 1985
IN VIEW THEREOF, this Court finds the accused guilty beyond reasonable doubt of the Rules of Criminal Procedure, as amended, provides that [T]he judgment must be written in the
offense of unjust vexation provided under Article 287 par. 2 of the Revised Penal Code and official language, personally and directly prepared by the judge and signed by him and shall
sentences him to suffer a penalty of imprisonment of twenty (20) days and to pay private contain clearly and distinctly a statement of the facts proved or admitted by the accused and
complainant the following: the law upon which the judgment is based.[15]
Although a memorandum decision is permitted under certain conditions, it cannot merely
P10,000.00 - moral damages refer to the findings of fact and the conclusions of law of the lower court. The court must make
a full findings of fact and conclusions of law of its own.[16]
P 5,000.00 - exemplary damages
Consequently, the decision of the regional trial court is a nullity. Very recently, speaking of
a similarly worded decision of a regional trial court, we said:
P 5,000.00 - attorneys fees and to pay the cost of this suit.
[I]t is starkly hallow, otiosely written, vacuous in its content and trite in its form. It achieved
SO ORDERED. nothing and attempted at nothing, not even at a simple summation of facts which could easily
be done. Its inadequacy speaks for itself.[17]
Bacolod City, Philippines, September 1, 1992.
Judges similarly disposed to pay lip service to their work must rethink their place in the
(SGD.)RAFAEL O. PENUELA judiciary or seriously take refresher courses on decision writing. We warn them of stiff
Judge[8] sanctions for such lackadaisical performance.

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Consequently, the case may be remanded to the lower court for compliance with the
constitutional requirement of contents of a decision. However, considering that this case has
been pending for sometime, the ends of justice will be fully served if we review the evidence
and decide the case.
Petitioner admitted having ordered the cutting of the electric, water and telephone lines of
complainants business establishment because these lines crossed his property line. He failed,
however, to show evidence that he had the necessary permit or authorization to relocate the
lines. Also, he timed the interruption of electric, water and telephone services during peak
hours of the operation of business of the complainant. Thus, petitioners act unjustly annoyed or
vexed the complainant. Consequently, petitioner Ong Chiu Kwan is liable for unjust vexation.
Regarding damages, we find the award of moral and exemplary damages and attorneys
fees to be without basis. Moral damages may be recovered if they were the proximate result of
defendants wrongful act or omission.[18] An award of exemplary damages is justified if the
crime was committed with one or more aggravating circumstances. [19] There is no evidence to
support such award. Hence, we delete the award of moral damages, exemplary damages, and
attorneys fees.
WHEREFORE, the decisions of the lower courts are REVERSED and SET ASIDE. In lieu
thereof, accused Ong Chiu Kwan is hereby sentenced to pay a fine of P200.00, and the
costs.The award of moral and exemplary damages and attorneys fees is hereby deleted.
SO ORDERED.

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SPOUSES ALFREDO AND ENCARNACION CHING, petitioners, vs. COURT OF APPEALS, On November 13, 1990, the RTC of Makati rendered judgment in the second annulment
FAMILY SAVINGS BANK, and FERDINAND J. GUERRERO, SENIOR DEPUTY case in favor of petitioners and declared null and void the levy and sale on execution upon the
SHERIFF, MANILA, respondents. conjugal property.[23] Respondents elevated the decision to the Court of Appeals in CA G.R.
CV No. 31795. On October 27, 1994, the Court of Appeals issued the assailed decision,
This petition for review on certiorari, under Rule 45 of the Rules of Court, seeks to set reversing and setting aside the decision of the RTC of Makati. [24] The Court of Appeals
aside the decision[1] of the Court of Appeals in CA G.R. CV No. 31795, dated October 27, declared that the Makati annulment case is barred by res judicata because of the
1994, as well as its resolution,[2] dated January 27, 1995, denying petitioners motion for prior Rizalannulment case and Manila collection case. Hence, this appeal.
reconsideration.
Petitioners pray for the reversal of the decision of the Court of Appeals on the following
The facts, gathered from the records of the petition, involve three different cases filed in grounds:[25]
separate jurisdictions.
I
On August 6, 1981, respondent Family Savings Bank (Bank) filed a complaint[3] with the
Court of First Instance (CFI) of Manila, for the collection of a sum of money against its debtor
Cheng Ban Yek & Co., Inc. and petitioner Alfredo Ching, who acted as a surety for Cheng Ban The Court of Appeals erred in holding that the decisions rendered in the Manila collection case
Yek & Co., Inc.[4] A day after the complaint was filed, the Bank was able to obtain a writ of and Rizal annulment case, taken together, constitute res judicata or bar by prior judgment to
preliminary attachment against the defendants.[5] Armed with a writ of preliminary attachment, the annulment case filed with the RTC of Makati. Assuming there is res judicata or bar by prior
the deputy sheriff of the CFI of Manila, herein respondent Ferdinand J. Guerrero, proceeded to judgment, the Court of Appeals erred in not holding that respondents have waived this
levy upon a conjugal property[6] belonging to petitioners, spouses Alfredo and Encarnacion defense.
Ching.[7]
II
On July 26, 1982, petitioners filed a petition[8] with the CFI of Rizal,[9] seeking to declare
illegal the levy on attachment upon their conjugal property. [10] Petitioners claimed that the The Court of Appeals erred in holding that petitioner Encarnacion Ching waived or abandoned
branch sheriff had no authority to levy upon a property belonging to the conjugal partnership. her right or claim on her conjugal property when she did not intervene in the Manila collection
The trial court, however, dismissed the case on August 8, 1983 for lack of jurisdiction because case.
the subject property was already under custodia legis of the CFI of Manila.[11]
Meanwhile, summary judgment was rendered in the collection case in favor of the Bank III
on August 12, 1982.[12] The defendants therein, including petitioner Alfredo Ching, appealed
the summary judgment to the Court of Appeals.[13] While the case was on appeal,[14] the trial In any event, the Court of Appeals erred in not deciding the Makati annulment case on its
court granted the Banks motion for execution pending appeal.[15] As a consequence, the merits on equitable considerations.
attached conjugal property was levied upon and sold through public auction by the deputy
sheriff to the Bank on October 10, 1983.[16] We deny the petition.
On September 5, 1984, in an effort to prevent the deputy sheriff from consolidating the The Makati annulment case should have been dismissed from the start for lack of
sale, petitioners filed a second annulment case[17] with the Regional Trial Court (RTC) of jurisdiction. The RTC of Makati does not have the authority to nullify the levy and sale on
Makati.[18] Petitioners sought to declare void the levy and sale on execution of their conjugal execution that was ordered by the CFI of Manila, a co-equal court. The determination of
property by reiterating the same argument raised in the first annulment case, i.e., that the whether or not the levy and sale of a property in execution of a judgment was valid, properly
branch sheriff had no authority to levy upon a property belonging to the conjugal partnership.[19] falls within the jurisdiction of the court that rendered the judgment and issued the writ of
On November 15, 1985, while the second annulment case was pending, the Court of execution.[26]
Appeals dismissed the appeal filed in the collection case and affirmed in toto the summary Beginning with the case of Orais v. Escao,[27] down to the subsequent cases of Nuez v.
judgment rendered by the CFI of Manila.[20] The matter was elevated to us on a petition for Low,[28] Cabigao v. del Rosario,[29] Hubahib v. Insular Drug Co., Inc.,[30] National Power Corp. v.
review,[21] but was eventually dismissed for having been filed out of time and for lack of De Veyra,[31] Luciano v. Provincial Governor,[32] De Leon v. Hon. Judge Salvador,[33] Cojuangco
merit.[22]Hence, the decision in the collection case became final. v. Villegas,[34] Darwin v. Tokonaga,[35] we laid down the long standing doctrine that no court has
the power to interfere by injunction with the judgments or decrees of a court of concurrent or

8
coordinate jurisdiction. The various trial courts of a province or city, having the same or equal if the claim of impropriety on the part of the sheriff in the execution proceedings is made by a
authority, should not, cannot, and are not permitted to interfere with their respective cases, party to the action, not a stranger thereto, any relief therefrom may only be applied with, and
much less with their orders or judgments. A contrary rule would obviously lead to confusion obtained from, the executing court. This is true even if a new party has been impleaded in the
and seriously hamper the administration of justice. suit.
There is no dispute that the subject conjugal property was under custodia legis of the CFI Is a spouse, who was not a party to the suit but whose conjugal
of Manila. It was initially attached under a writ of preliminary attachment issued by the CFI of property is being executed on account of the other spouse being the judgment obligor,
Manila. Said property was later on levied upon and sold under a writ of execution issued by the considered a stranger? In Mariano v. Court of Appeals,[39] we answered this question in the
same court. Since the attachment, levy and sale have been carried out upon orders of the CFI negative. In that case, the CFI of Caloocan City declared the wife to be the judgment obligor
of Manila, any and all questions concerning the validity and regularity thereof necessarily had and, consequently, a writ of execution was issued against her. Thereupon, the sheriff
to be addressed to the CFI of Manila. proceeded to levy upon the conjugal properties of the wife and her husband. The wife initially
filed a petition for certiorari with the Court of Appeals praying for the annulment of the writ of
Petitioners, however, contend that one of the owners of the property, petitioner execution. However, the petition was adjudged to be without merit and was accordingly
Encarnacion Ching, was not a party to the collection case. Not being a party thereto, dismissed. The husband then filed a complaint with the CFI of Quezon City for the annulment
Encarnacion Ching should be allowed to file a separate case as a third-party claimant and said of the writ of execution, alleging therein that the conjugal properties cannot be made to answer
filing cannot be considered as an encroachment upon the jurisdiction of a co-equal and for obligations exclusively contracted by the wife. The executing party moved to dismiss the
coordinate court.[36] annulment case, but the motion was denied. On appeal, the Court of Appeals, in Mariano,
We do not agree. ruled that the CFI of Quezon City, in continuing to hear the annulment case, had not interfered
with the executing court. We reversed the Court of Appeals ruling and held that there was
Section 16 of Rule 39 of the Rules of Court authorizes a third person, who is not the interference by the CFI of Quezon City with the execution of the CFI of Caloocan City. We
judgment debtor or his agent, to vindicate his claim to a property levied through an entirely ruled that the husband of the judgment debtor cannot be deemed a stranger to the case
separate and distinct action. Said rule reads as follows:[37] prosecuted and adjudged against his wife, which would allow the filing of a separate and
independent action.
SECTION 16. Proceedings where property claimed by third person. If the property levied on is
The facts of the Mariano case are similar to this case. Clearly, it was inappropriate for
claimed by any person other than the judgment obligor or his agent, and such person makes
petitioners to institute a separate case for annulment when they could have easily questioned
an affidavit of his title thereto or right to the possession thereof, stating the grounds of such
the execution of their conjugal property in the collection case. We note in fact that the trial court
right or title, and serves the same upon the officer making the levy and a copy thereof upon the
in the Rizal annulment case specifically informed petitioners that Encarnacion Chings rights
judgment obligee, the officer shall not be bound to keep the property, unless such judgment
could be ventilated in the Manila collection case by the mere expedient of intervening
obligee, on demand of the officer, files a bond approved by the court to indemnify the third-
therein.[40] Apparently, petitioners ignored the trial courts advice, as Encarnacion Ching did not
party claimant in a sum not less than the value of the property levied on. In case of
intervene therein and petitioners instituted another annulment case after their conjugal property
disagreement as to such value, the same shall be determined by the court issuing the writ of
was levied upon and sold on execution.
execution. No claim for damages for the taking or keeping of the property may be enforced
against the bond unless the action therefor is filed within one hundred twenty (120) days from There have been instances where we ruled that a spouse may file a separate case
the date of the filing of the bond. against a wrongful execution.[41] However, in those cases, we allowed the institution of a
separate and independent action because what were executed upon were the paraphernal or
The officer shall not be liable for damages for the taking or keeping of the property, to any exclusive property of a spouse who was not a party to the case. In those instances, said
third-party claimant if such bond is filed. Nothing herein contained shall prevent such claimant spouse can truly be deemed a stranger. In the present case, the levy and sale on execution
or any third person from vindicating his claim to the property in a separate action, or prevent was made upon the conjugal property.
the judgment obligee from claiming damages in the same or separate action against a third-
party claimant who filed a frivolous or plainly spurious claim. In any case, even without the intervention of Encarnacion Ching in the collection case, it
appears that Alfredo Ching was able to raise the conjugal nature of the property in both the trial
court and appellate court. A perusal of the records reveals that petitioner Alfredo Ching filed a
In Ong v. Tating,[38] we elucidated on the applicability of Section 16 of Rule 39 of the Motion for Reconsideration and to Quash Writ of Execution before the CFI of Manila. In the
Rules of Court. We held therein that a separate and distinct case from that in which the motion, he specifically argued that the execution was invalid for having been enforced upon
execution has issued is proper if instituted by a stranger to the latter suit. Upon the other hand, their conjugal property.[42] Alfredo Ching raised this argument again on appeal in CA G.R.
9
CVNo. 02421.[43] Evidently, due process has been afforded to petitioners as regards the
execution on their conjugal property.
Considering that that the RTC of Makati did not have jurisdiction to hear Civil Case No.
8389, it becomes unnecessary to resolve the other issues raised by petitioners.
WHEREFORE, the petition for review is DENIED. The assailed decision and resolution of
the Court of Appeals are hereby AFFIRMED. Costs against petitioners.
SO ORDERED.

10
ARMAND NOCUM G.R. No. 145022 part was negated by the publication in the same article of plaintiff's or PAL's
and THE side of the dispute with the pilot's union.
PHILIPPINE DAILY Present:
INQUIRER, INC., ALPAP and UMALI likewise filed their joint answer, dated October 31, 1998,
P e t i t i o n e r s, PUNO, and alleged therein that: (1) the complaint stated no cause of action; (2) venue
Chairman, was improperly laid; and (3) plaintiff Lucio Tan was not a real party in
AUSTRIA-MARTINEZ, interest. It appeared that the complaint failed to state the residence of the
CALLEJO, SR. complainant at the time of the alleged commission of the offense and the place
TINGA, and where the libelous article was printed and first published.
- versus - CHICO-NAZARIO, JJ .
Thus, the Regional Trial Court of Makati issued an Order dated February 10,
1999, dismissing the complaint without prejudice on the ground of improper
Promulgated: venue.

LUCIO TAN, September 23, 2005


R e s p o n d e n t. Aggrieved by the dismissal of the complaint, respondent Lucio Tan filed an
Omnibus Motion dated February 24, 1999, seeking reconsideration of the
X-------------------------------------X dismissal and admission of the amended complaint. In par. 2.01.1 of the
amended complaint, it is alleged that 'This article was printed and first
Assailed in a Petition for Review on Certiorari under Rule 45 of the 1997 Rules of Civil published in the City of Makati (p. 53, Rollo, CA-G.R. SP No. 55192), and in
Procedure are the decision [1] of the Court of Appeals dated 19 April 2000 that affirmed the par. 2.04.1, that 'This caricature was printed and first published in the City
order of the Regional Trial Court (RTC) of Makati City, Branch 56, in Civil Case No. 98-2288, of Makati (p. 55, id.).
dated 19 April 1999, admitting respondent Lucio Tan's Amended Complaint for Damages for
the alleged malicious and defamatory imputations against him in two (2) articles of the The lower court, after having the case dismissed for improper venue, admitted
Philippine Daily Inquirer, and its Resolution [2] dated 15 September 2000 denying petitioners the amended complaint and deemed set aside the previous order of dismissal,
Armand Nocum and The Philippine Daily Inquirer, Inc.s' motion for reconsideration. supra, stating, inter alia, that:

The mistake or deficiency in the original complaint appears now to have


The antecedents are summarized by the Court of Appeals. been cured in the Amended Complaint which can still be properly admitted, pursuant to
Rule 10 of the 1997 Rules of Civil Procedure, inasmuch as the Order of dismissal is not
yet final. Besides, there is no substantial amendment in the Amended Complaint which
On September 27, 1998, Lucio Tan filed a complaint against reporter Armand Nocum, Capt. would affect the defendants' defenses and their Answers. The Amendment is merely
Florendo Umali, ALPAP and Inquirer with the Regional Trial Court of Makati, docketed as Civil formal, contrary to the contention of the defendants that it is substantial.
Case No. 98-2288, seeking moral and exemplary damages for the alleged malicious and
defamatory imputations contained in a news article. Dissatisfied, petitioners, together with defendants Capt. Florendo Umali and the Airline Pilots
Association of the Philippines, Inc. (ALPAP), appealed the RTC decision to the Court of
Appeals. Two petitions for certiorari were filed, one filed by petitioners which was docketed as
INQUIRER and NOCUM filed their joint answer, dated October 27, 1998,
wherein they alleged that: (1) the complaint failed to state a cause of action; CA-G.R. SP No. 55192, and the other by defendants Umali and ALPAP which was docketed
(2) the defamatory statements alleged in the complaint were general as CA-G.R. SP No. 54894. The two petitions were consolidated.
conclusions without factual premises; (3) the questioned news report
constituted fair and true report on the matters of public interest concerning a
public figure and therefore, was privileged in nature; and (4) malice on their
11
On 19 April 2000, the Court of Appeals rendered its decision the dispositive portion of which COURT; AND (2) THAT THE AMENDED COMPLAINT WAS PROPERLY ALLOWED OR
reads: ADMITTED BECAUSE THE LOWER COURT WAS 'NEVER DIVESTED OF JURISDICTION
OVER THE CASE;
WHEREFORE, premises considered, the petition is hereby DENIED DUE COURSE and
DISMISSED for lack of merit. The Order of the court a quo is hereby AFFIRMED.
B. THE COURT OF APPEALS ERRED IN NOT RULING THAT THE
ORIGINAL COMPLAINT OF RESPONDENT WAS AMENDED
The motions for reconsideration filed by petitioners and by defendants Umali PURPOSELY TO CONFER UPON THE LOWER COURT
and ALPAP were likewise denied in a resolution dated 15 September 2000. JURISDICTION OVER THE CASE. [10]

Both petitioners and defendants Umali and ALPAP appealed to this Court. Under Petitioners state that Article 360 of the Revised Penal Code vests jurisdiction over all
civil and criminal complaints for libel on the RTC of the place: (1) where the libelous
consideration is the petition for review filed by petitioners.
article was printed and first published; or (2) where the complainant, if a private
person, resides; or (3) where the complainant, if a public official, holds office. They
On 11 December 2000, the Court required respondent Tan to comment on the petition filed by argue that since the original complaint only contained the office address of respondent
and not the latter's actual residence or the place where the allegedly offending news
petitioners. [3] reports were printed and first published, the original complaint, by reason of the
deficiencies in its allegations, failed to confer jurisdiction on the lower court.
Respondent filed his comment on 22 January 2001 [4] to which petitioners filed a reply on 26
April 2001. [5] The question to be resolved is: Did the lower court acquire jurisdiction over the civil case upon
the filing of the original complaint for damages?
In a Manifestation filed on 19 February 2001, respondent stated that the petition[6] filed by
defendants Umali and ALPAP has already been denied by the Court in a resolution dated 17 We rule in the affirmative.
January 2001. [7]
It is settled that jurisdiction is conferred by law based on the facts alleged in the
On 20 August 2003, the Court resolved to give due course to the petition and required the complaint since the latter comprises a concise statement of the ultimate facts constituting the
parties to submit their respective memoranda within thirty (30) days from notice. [8] Both plaintiff's causes of action. [11] In the case at bar, after examining the original complaint, we
petitioners and respondent complied. [9] find that the RTC acquired jurisdiction over the case when the case was filed before it. From
the allegations thereof, respondent's cause of action is for damages arising from libel, the
Petitioners assigned the following as errors: jurisdiction of which is vested with the RTC. Article 360 of the Revised Penal Code provides
that it is a Court of First Instance [12] that is specifically designated to try a libel case. [13]
A. THE COURT OF APPEALS ERRED IN RULING (1) THAT THE LOWER COURT HAD
JURISDICTION OVER THE CASE (ON THE BASIS OF THE ORIGINAL COMPLAINT) Petitioners are confusing jurisdiction with venue. A former colleague, the Hon. Florenz D.
NOTWITHSTANDING THE FACT THAT THE LOWER COURT HAD EARLIER DISMISSED Regalado, [14] differentiated jurisdiction and venue as follows: (a) Jurisdiction is the authority
THE ORIGINAL COMPLAINT FOR ITS FAILURE TO CONFER JURISDICTION UPON THJE to hear and determine a case; venue is the place where the case is to be heard or tried; (b)

12
4. If an offended party is a private person, the venue is his place of residence
Jurisdiction is a matter of substantive law; venue, of procedural law; (c) Jurisdiction establishes
at the time of the commission of the offense or where the libelous article is
a relation between the court and the subject matter; venue, a relation between plaintiff and printed and first published.
defendant, or petitioner and respondent; and, (d) Jurisdiction is fixed by law and cannot be
The common feature of the foregoing rules is that whether the offended party
conferred by the parties; venue may be conferred by the act or agreement of the parties. is a public officer or a private person, he has always the option to file the
action in the Court of First Instance of the province or city where the libelous
article is printed or first published.
In the case at bar, the additional allegations in the Amended Complaint that the article and the
caricature were printed and first published in the City of Makatireferred only to the question of
We further restated [18] the rules on venue in Article 360 as follows:
venue and not jurisdiction. These additional allegations would neither confer jurisdiction on the
RTC nor would respondent's failure to include the same in the original complaint divest the
1. Whether the offended party is a public official or a private person, the criminal action may
lower court of its jurisdiction over the case. Respondent's failure to allege these allegations
be filed in the Court of First Instance of the province or city where the libelous article is printed
gave the lower court the power, upon motion by a party, to dismiss the complaint on the
and first published.
ground that venue was not properly laid.

In Laquian v. Baltazar, [15] this Court construed the term 'jurisdiction in Article 360 of the 2. If the offended party is a private individual, the criminal action may also be
filed in the Court of First Instance of the province where he actually resided at the time
Revised Penal Code as referring to the place where actions for libel shall be filed or venue. of the commission of the offense.

In Escribano v. Avila, [16] pursuant to Republic Act No. 4363, [17] we laid down the following 3. If the offended party is a public officer whose office is in Manila at the time of the
commission of the offense, the action may be filed in the Court of First Instance of
rules on the venue of the criminal and civil actions in written defamations. Manila.

1. General rule: The action may be filed in the Court of First Instance of the province or city 4. If the offended party is a public officer holding office outside of Manila, the
action may be filed in the Court of First Instance of the province or city where he held
where the libelous article is printed and first published or where any of the offended parties office at the time of the commission of the offense.
actually resides at the time of the commission of the offense.
We fully agree with the Court of Appeals when it ruled:

2. If the offended party is a public officer with office in Manila at the time the We note that the amended complaint or amendment to the complaint was not intended to vest
offense was committed, the venue is Manila or the city or province where the
libelous article is printed and first published. jurisdiction to the lower court, where originally it had none. The amendment was merely to
establish the proper venue for the action. It is a well-established rule that venue has nothing to
3. Where an offended party is a public official with office outside of Manila, the
do with jurisdiction, except in criminal actions. Assuming that venue were properly laid in the
venue is the province or the city where he held office at the time of the
commission of the offense or where the libelous article is printed and first court where the action was instituted, that would be procedural, not a jurisdictional impediment.
published. In fact, in civil cases, venue may be waived.

13
Consequently, by dismissing the case on the ground of improper venue, the
dismissed it on the ground of improper venue. The amendment merely laid down the proper
lower court had jurisdiction over the case. Apparently, the herein petitioners
recognized this jurisdiction by filing their answers to the venue of the case.
complaint, albeit, questioning the propriety of venue, instead of a motion to
dismiss.
WHEREFORE, the foregoing considered, the decision of the Court of Appeals dated 19 April
... 2000 is AFFIRMED in toto. No costs.

We so hold that dismissal of the complaint by the lower court was proper
considering that the complaint, indeed, on its face, failed to allege neither the SO ORDERED.
residence of the complainant nor the place where the libelous article was printed and
first published. Nevertheless, before the finality of the dismissal, the same may still be
amended as in fact the amended complaint was admitted, in view of the court a
quo's jurisdiction, of which it was never divested. In so doing, the court acted properly
and without any grave abuse of discretion. [19]

It is elementary that objections to venue in CIVIL ACTIONS arising from libel


may be waived since they do not involve a question of jurisdiction. The laying of venue
is procedural rather than substantive, relating as it does to jurisdiction of the court over
the person rather than the subject matter. Venue relates to trial and not to
jurisdiction. [20] It is a procedural, not a jurisdictional, matter. It relates to the place of
trial or geographical location in which an action or proceeding should be brought and
not to the jurisdiction of the court. [21] It is meant to provide convenience to the parties,
rather than restrict their access to the courts as it relates to the place of trial. [22] In
contrast, in criminal actions, it is fundamental that venue is jurisdictional it being an
essential element of jurisdiction. [23]

Petitioners' argument that the lower court has no jurisdiction over the case because
respondent failed to allege the place where the libelous articles were printed and first published
would have been tenable if the case filed were a criminal case. The failure of the original
complaint to contain such information would be fatal because this fact involves the issue of
venue which goes into the territorial jurisdiction of the court. This is not to be because the case
before us is a civil action where venue is not jurisdictional.

The cases [24] cited by petitioners are not applicable here. These cases involve amendments
on complaints that confer jurisdiction on courts over which they originally had none. This is not
true in the case at bar. As discussed above, the RTC acquired jurisdiction over the subject
matter upon the filing of the original complaint. It did not lose jurisdiction over the same when it

14
SPS. TERESITO Y. VILLACASTIN G.R. No. 170478
the mortgage, foreclosure and sale of the properties, claiming that they are the owners thereof
and LOURDES FUA VILLACASTIN,
under Presidential Decree No. 27. the case was docketed as Reg. Case No. VII-76-C-90.
Petitioners, Present:
In the meantime, on May 10, 1988, petitioners filed a Complaint for Forcible Entry with
Chairperson,
Prayer for a Writ of Preliminary Mandatory Injunction,[2] docketed as Civil Case No. 79, with the
TINGA,
First Municipal Circuit Trial Court (MCTC) of Bantayan, Cebu, against respondent and a certain
VELASCO, JR.,
Elesio Monteseven. The complaint averred that plaintiffs (petitioners herein) are the owners
- versus - DE CASTRO, and
and actual possessors of the subject landholding and that defendants, having entered the
.
property through stealth and strategy, unlawfully deprived plaintiffs of possession thereof.
PAUL PELAEZ, Promulgated:
Respondent countered that he is the owner of the subject property, which was
Respondent. foreclosed by the DBP and later purchased by petitioners at an auction sale. Petitioners,
however, were allegedly never in possession of the subject property as they failed to apply for
May 22, 2008 a writ of possession therefor. Respondent further claimed that he had redeemed the property
x-------------------------------------------------------------------x on March 3, 1988 and accordingly reacquired possession thereof.[3]

A conflict of jurisdiction between the Department of Agrarian Reform Adjudication Board Meanwhile, the Provincial Agrarian Reform Adjudicator in Cebu rendered a decision in Reg.
(DARAB) and the regular trial courts is at the core of the present case. Petitioners question the
Decision[1] of the Court of Appeals dated February 7, 2005, in CA-G.R. SP. No. 83873, which Case No. VII-76-C-90 dated February 15, 1993, in favor of the tenants, the dispositive portion
upheld the primary and exclusive jurisdiction of the DARAB in cases involving the use or
of which states:
possession of lands covered by agrarian laws.
WHEREFORE, in the light of the foregoing view, DECISION is hereby
The facts, as culled from the record, are as follows: rendered as follows:

1. Declaring complainants herein with the exception of Silbino Arranquez[,] Jr.


On June 29, 1976, rspondent Paul Pelaez and his wife mortgaged their agricultural and Claro Gilbuela who earlier withdraw from this case as bonafide tenant
lands bearing Original Certificates of Title Nos. 0-10343, 0-10344 and 0-10345, situated in farmers of the parcels in question covered by P.D. [No.] 27;

Barrio Kodia, Madridejos, Cebu, to the Development Bank of the Philippines (DBP) Bogo
Branch, Cebu. For failure of the Pelaez spouses to pay their mortgage obligation, the 2. Declaring the mortgage executed by Sps. Paul and Elnora Pelaez to
respondent DBP and the subsequent foreclosure and eventual sale thereof to
properties were foreclosed and subsequently sold at public auction. Sps. Teresito and Lourdes Villacastin as null and void ab initio as it is contrary
to law, public order and public policy;
The purported tenants of the property, Anastacio Alob, Francisco Alob, Jesus
3. Declaring complainants herein to properly account their deposited
Cordova, Manuel Sanchez, Elia Giltendez, Flora dela Pea, Eliseo Rayco, Benjamin Santillan, shares/lease rentals before the DAR office of Bantayan[,] Cebu and deliver the
said deposited [share/lease] rentals including the forthcoming harvest thereon
Pascual Gilbuena, Jesus Alob, Renaldo Grande, and Julieto Manzueto, filed an action to annul

15
to respondent landowners Sps. Paul and Elnora Pelaez with the assistance of
the MARO of Bantayan, Madridejos, Cebu. In his Comment[9] dated March 21, 2006, respondent underscores the fact that the parcels of
land subject of this case are tenanted agricultural lands. Before judgment was rendered in the
4. No pronouncement as to cost.[4]
forcible entry case, the tenants of the property already filed a suit with the DARAB for the
This decision was affirmed by the DARAB in a Decision[5] dated February 22, 2000. annulment of the real estate mortgage executed by respondent over the same in favor of DBP

On January 6, 2000, the MCTC rendered judgment in Civil Case No. 79 in favor of petitioners and the subsequent foreclosure and auction sale in favor of petitioners. The DARABs decision

and disposed as follows: declaring the mortgage, foreclosure and auction sale null and void became final as regards
petitioners who did not appeal from the decision. Respondent asserts that the complaint for
WHEREFORE, premises considered, defendant is hereby ordered:
forcible entry filed by petitioners had lost its legal basis after the DARAB declared that the
a) To return to plaintiffs possession of the parcel of land above-described and
vacate the premises; foreclosure and auction sale of the subject property were null and void.

b) To pay the costs of litigation; Petitioners filed a Reply[10] dated July 28, 2006, insisting that the tenant-farmers
c) Moral and exemplary damages not recoverable in ejectment suit is denied; involved in the DARAB case were not parties to the forcible entry case, the only defendant
d) Expenses claimed not duly proven are disallowed; therein being respondent in this case. Respondent, in turn, raised the defense of ownership,
e) To release in favor of the plaintiffs the cash bond the sum of P5,000.00 thereby joining the issues regarding possession and ownership.
deposited pursuant to the issuance of a Writ of Preliminary Mandatory
Injunction.[6] Petitioners further note their argument in their Motion for Reconsideration [11] of the
Decision of the Court of Appeals that the subject property had been declared as wilderness
In a Decision[7] dated March 10, 2004, the Regional Trial Court (RTC) of Dakit, Bogo, Cebu,
area and the same had been classified as alienable and disposable on December 22, 1987. In
Branch 61, affirmed the MCTC decision.
support of this contention, they submitted a Department of Agrarian Reform
The Court of Appeals, however, ruled that regular courts should respect the Order[12] dated September 12, 1997 to the effect that the subject property falls within the
primary jurisdiction vested upon the DARAB in cases involving agricultural administrative authority or competence of the Department of Environment and Natural
lands such as the property subject of this case. Accordingly, it set aside the Resources (DENR). The order directed the PARO of Cebu and the MARO of
decision rendered by the RTC and the MCTC, and dismissed the complaint for Bantayan, Cebu to cease and desist from further activities affecting the subject property under
forcible entry filed by petitioners in this case. Operation Land Transfer, and to refer the matter to the DENR.

The appellate court denied reconsideration in its Resolution[8] dated November 11, 2005. Jurisdiction over the subject matter is determined by the allegations of the complaint.[13] In

Petitioners contend that Civil Case No. 79 did not involve any agrarian matter and thus, the ascertaining, for instance, whether an action is one for forcible entry falling within the exclusive

MCTC correctly exercised jurisdiction over the case.


16
jurisdiction of the inferior courts, the averments of the complaint and the character of the relief entitled to. It does not involve the adjudication of an agrarian reform matter, nor an agrarian
sought are to be examined.[14] dispute falling within the jurisdiction of the DARAB.

A review of the complaint reveals that the pertinent allegations thereof sufficiently vest Courts have jurisdiction over possessory actions involving public or private
jurisdiction over the action on the MCTC. The complaint alleges as follows: agricultural lands to determine the issue of physical possession as this issue is independent of
the question of disposition and alienation of such lands which should be threshed out in the
III That the plaintiffs are the owners and legal as well as actual possessors of a parcel of
DAR.[18] Thus, jurisdiction was rightfully exercised by the MCTC and the RTC.
agricultural land more particularly described as follows:
IV That the defendant, sometime in the second week of March WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals in
1988, by strategy and through stealth entered the above-described land of the
CA-G.R. SP. No. 83873 dated February 7, 2005, and its Resolution dated November 11,
plaintiffs and took possession thereof; thus, depriving said plaintiffs of the
possession thereof; 2005, are REVERSED and SET ASIDE. The Decision of the Regional Trial Court of Dakit,
V That several demands were made the plaintiffs upon the Bogo, Cebu, Branch 61, dated March 10, 2004, affirming the decision of the Municipal Circuit
defendants to restore to them the possession of the above-described parcel of
land; but, defendants refused and still refuse to restore possession of said Trial Court of Bantayan, Cebu, dated June 6, 2000, is REINSTATED. No pronouncement as to
property to the plaintiffs;[15] costs.

It has not escaped our notice that no landowner-tenant vinculum juris or juridical tie SO ORDERED.
was alleged between petitioners and respondent, let alone that which would characterize the
relationship as an agrarian dispute.[16] Rule II of the DARAB Rules[17] provides that the DARAB
shall have primary jurisdiction, both original and appellate, to determine and adjudicate all
agrarian disputes, cases, controversies, and matters or incidents involving the implementation
of the Comprehensive Agrarian Reform Program under Republic Act No. 6657, Executive
Order Nos. 229, 228 and 129-A, Republic Act No, 3844 as amended by Republic Act No.
6389, Presidential Decree No. 27 and other agrarian laws and their implementing rules and
regulations.

Petitioners action is clearly for the recovery of physical or material possession of the
subject property only, a question which both the MCTC and the RTC ruled petitioners are

17
[G.R. No. 92625 : December 26, 1990.] comments to the petition, the trial on the merits could now proceed to
determine who of the parties are entitled to the custody of the child.
192 SCRA 768
WHEREFORE, premises considered, this Court hereby decides to REMAND
JOSE ORDA and IMELDA LOZADA, Petitioners, vs. THE HONORABLE COURT
this case to the Regional Trial Court, Branch 31, San Pablo City, for trial on
OF APPEALS and GIL GALANG Respondents.
the merits as to which of the parties are legally entitled to the custody of
the child, Joyce Orda Galang.
The question presented in this case is whether or not the Court of Appeals may SO ORDERED. 2
refer a petition for habeas corpus originally filed with it to the Regional Trial Court
In conformity with the foregoing decision the Regional Trial Court of San Pablo
for a full-blown trial due to conflicting facts presented by the parties.
City, the Hon. Napoleon R. Flojo presiding, before which private respondent filed
Originally, private respondent filed a petition for habeas corpus with the Regional his first action, ordered the reinstatement of Special Proceedings No. SP-719 (87)
Trial Court of San Pablo City to regain custody of his minor daughter, Joyce, who and scheduled the case for trial on the merits. 3 Upon examination of the records
continued staying with her maternal grandparents, petitioners herein, her mother of said case, petitioners noted that only the order of dismissal of the same was in
being already deceased at the initiation of the action. The case was eventually the expediente of the case. They brought this matter to the attention of the trial
dismissed for lack of jurisdiction because petitioners, as defendants therein, had court which then issued an order dated 27 January 1989 directing the Chief,
moved to Bataan and any writ of habeas corpus to be issued by the trial court may Archives Section of the Court of Appeals "to transmit to this Court the original
not be enforced against them. record of case AC-G.R. No. SP-13912 (sic) immediately upon receipt of this Order."
4
Subsequently, private respondent, on the basis of his being the sole surviving
parent of his daughter, filed a petition for habeas corpus with the respondent In reply, the respondent Court of Appeals advised the trial court that no records
Court of Appeals docketed as CA-G.R. No. 13912-SP, an original action to compel can be remanded because no expediente from the lower court was ever elevated.
petitioners to produce the body of minor Joyce Orda Galang and explain the basis For this reason, petitioners filed with respondent court on 21 April 1989 a Motion
of their custody. Petitioners herein filed their Opposition/Answer 1 alleging that for Clarification of its earlier decision alleging that CA-G.R. No. SP-13912 was an
private respondent abandoned his wife and child, had no source of livelihood and original action, not an appeal emanating from, or a special civil action to assail, a
therefore could not support his daughter, they prayed that care and custody of the case filed with the trial court, hence no record of the case can be remanded
child be awarded them.: rd because no expediente from the lower court was ever elevated to the Court of
Appeals; that Special Proceedings No. SP-719 (87) was dismissed for lack of
On 13 April 1988, respondent court issued its assailed decision, as follows:
jurisdiction and the order of dismissal has long become final and, moreover, herein
The conflicting thesis (sic), however, of petitioner [private respondent petitioners were never brought to the jurisdiction of the trial court in said special
herein] and respondents [petitioners herein] require a full-blown trial of the proceedings, so much so that they have not even presented an answer or
facts alleged by the parties. This could be shown by the initial discussions opposition in said special proceedings; and that a reinstatement of Special
aforestated. Proceedings No. SP-719 (87), over which the trial court had lost jurisdiction, may
not be justified by virtue of the order of the Court of Appeals to remand CA-G.R.
The records show that [private respondent] had already filed a similar
No. 13912 for trial on the merits. 5
petition before the Regional Trial Court, Fourth Judicial Region, Branch 31,
San Pablo City, on November 23, 1987, in Special Proceedings No. SP-719 The Court of Appeals 6 resolved this motion on 6 June 1989 as follows:
(87). However, the writ was returned unserved as [petitioners] ostensibly
At the outset, it is necessary to point out that this Court entertained this petition
transferred their domicile at the Philippine Refugee Processing Center at
for Habeas Corpus in the exercise of its original jurisdiction over such case. Said
Barrio Sabang, Morong, Bataan.
petition is in no way connected with the one dismissed by the lower court in SP-
Inasmuch as [petitioners] have submitted to the jurisdiction of the Court by 719 (87).
producing the body of the child, Joyce Orda Galang, and submitted their

18
In their Motion for Clarification, [petitioners] appear to be confused by this Court's We entertain no doubt that [petitioners] had never been brought to the
directive remanding the case to the lower court. jurisdiction of the lower court in SP: PROC. No. SP-719 (87)and agree with
the claim that the Order of dismissal issued in said case had already
It should be noted that when this Court ordered the same, it did not mean the
become final and executory. But then, it must be pointed out again that
remanding of the records, but (the) referring (of) the case to the court a quo for
with the filing of another petition for habeas corpus before this Court
appropriate action, it enjoying original and concurrent jurisdiction with this Court
(docketed as AC [sic] G.R. SP No. 13912), an entirely new proceeding was
over habeas corpus cases (B.P. 129).:-cralaw
commenced. Unlike the lower court in the previous habeas corpus case, this
Judge Napoleon Flojo also appears to be mixed up as he issued an Order dated Court acquired jurisdiction over the persons of [petitioners] upon their filing
January 27, 1989, which inter alia require the Chief, Archives Section of this Court of an Opposition/Answer on April 4, 1988 (p. 14, Rollo).
"to transmit" to the Regional Trial Court "the original record of case AC-G.R. No.
Section 9[1] in relation to Section 21 of Batas Pambansa Blg. 129 confers upon the
13912 immediately upon receipt of this order." (p. 106, Rollo) (sic) But no records
Court of Appeals authority to try and decide habeas corpus cases concurrent with
can be transmitted back to the lower court simply because no records were
the Regional Trial Courts. Concurrent or coordinate jurisdiction has been defined as
elevated in that, as aforesaid, the case was filed here as an original action.
that which is possessed by a court together with another or others over the same
The [petitioners] have manifested in their motion that they were not given an subject matter. Clearly, therefore, Batas Pambansa Blg. 129 provides the basis for
opportunity to answer or at least comment on the petition. Now the same is in the Us to refer AC (sic) G.R. SP No. 13912 to the lower court for trial on the merits.
lower court as directed in the decision sought to be clarified. Indeed, issues cannot With the referral of AC (sic) G.R. SP No. 13912, the jurisdiction which this Court
be joined if the lower court will deprive the [petitioners] (of) their right to respond acquired over the persons of [petitioners] was transferred to and conferred upon
to the petition. the Regional Trial Court, which necessarily must treat said case as a separate and
distinct proceeding from the one it earlier dismissed. This means that the Regional
WHEREFORE, for the sake of clarity the dispositive portion of the decision
Trial Court must assign the referred case a new number, but need not require the
dated April 13, 1988 is hereby MODIFIED to read as follows:
[private respondent] to remit the prescribed docketing fee inasmuch as the same
"WHEREFORE, premises considered, this Court hereby decides to had already been paid with this Court. What the parties need to do though is to
REFER this case to the Regional Trial Court, Branch 31, San Pablo reproduce the pleadings they filed in AC (sic) G.R. SP No. 13912 before the
City, for trial on the merits as to which of the parties are legally Regional Trial Court in order for issues to be joined therein.- nad
entitled to the custody of the child, Joyce Orda Galang. FOR ISSUES
Accordingly, the dispositive portion of the Decision dated April 13, 1988 is hereby
TO BE JOINED, THE LOWER COURT IS HEREBY ORDERED TO
further clarified to read thus:
REQUIRE THE [petitioners] TO ANSWER THE PETITION."
"WHEREFORE, premises considered, this Court hereby decides to REFER
SO ORDERED." 7
this case to the regional Trial Court, Branch 31, San Pablo City, for trial on
Both parties filed separate motions for reconsideration of the foregoing resolution. the merits as to which of the parties are legally entitled to the custody of
Petitioners contended that respondent Court of Appeals had no authority to refer the child, Joyce Orda Galang. FOR THIS PURPOSE, THE PARTIES ARE
the case to the lower court for trial on the merits because said court, in the DIRECTED TO REPRODUCE ALL THE PLEADINGS THEY FILED IN AC (sic)
original habeas corpus case filed by private respondent, had never acquired G.R. SP NO. 13912 BEFORE THE REGIONAL TRIAL COURT, UPON THE
jurisdiction over their persons. Further, that respondent court had no power to RECEIPT OF WHICH, SHALL ASSIGN THE CASE A NEW NUMBER WITHOUT
order a case docketed with the lower court without private respondent having paid REQUIRING [private respondent] TO PAY THE DOCKETING FEE."
the docketing fee and filing an appropriate pleading therein. Private respondent,
SO ORDERED. 9
on the other hand, also set forth similar contentions and prayed that trial on the
merits be resumed by respondent Court. In this special civil action for Certiorari petitioners assign the following as errors
committed by the Court of Appeals:
The Court of Appeals 8 resolved both motions for reconsideration on 13 March
1990 as follows: 1. Respondent Court of Appeals erred, as it is without authority [to do so],
in referring the original action for habeas corpus filed before it to the
19
Regional Trial Court, Branch 31, San Pablo City, for trial on the merits to PROCEDURE IN SPECIAL CASES
determine the issue as to which of the parties are legally entitled to the
custody of the child, its reliance on Section 9[1] in relation to Section 21 xxx
of B.P. Blg. 21 being specious.
SEC. 2. Special Civil Action. — Original verified petitions for Certiorari,
2. Respondent Court of Appeals erred in ordering the parties to the original prohibition, mandamus, habeas corpus, quo warranto and other writs may
action for habeas corpus filed before it to reproduce before the Regional be filed in the Court of Appeals . . .
Trial Court all the pleadings they filed in AC-G.R. SP No. 13912 (sic).
xxx
3. Respondent Court of Appeals erred, as it is without authority [to do so],
in directing the Regional Trial Court, Branch 31, San Pablo City, to c. Judicial Action. — The Court may either deny due course or dismiss the
assign the case a new case number without requiring herein private petition outright, or require the private respondent or respondents to
respondent (as petitioner therein) to pay the docket fee therefor. 10 comment on the petition, or give due course thereto.

There is merit in the contentions of petitioners. xxx

Essentially, petitioners argue that the Court of Appeals has no power to issue the (5) If it appears that there is need for reception of evidence, the Division to
decision remanding the proceedings to the trial court and the two subsequent which the Justice to whom the case is assigned for study and report
resolutions clarifying the same. belongs shall conduct the hearing. The Division shall have the power to
perform any acts to resolve the factual issues raised in the case (Emphasis
The assailed decision and the two resolutions of the Court of Appeals are not supplied.)
supported by law and the Rules of Court. The provisions of the Judiciary
Reorganization Act (B.P. Blg. 129) cited by the respondent Court of Appeals in its Attention is also directed to the fact that the foregoing provision is silent as to
resolution dated 13 March 1990 are not in point. Sections 9(1) and 21 thereof whether or not the hearing may be delegated, unlike that of the provision on
merely provide that the Court of Appeals and Regional Trial Courts, respectively, annulment of judgments, Section 1(c)(3) of the same Rule, where, on motion of
exercise original jurisdiction to issue writs of habeas corpus, among others. While the parties, referral of any of the issues to a Commissioner is allowed in
recognizing the concurrent original jurisdiction of both courts over habeas corpus accordance with Rule 33 of the Rules of Court.
cases as special proceedings, these provisions are not authority for remanding or Under the foregoing disquisition, the Court of Appeals was in error in ordering the
referring to the latter original actions filed with the former. remand and later on the referral of the original petition for habeas corpus filed
On the contrary, the Court of Appeals is specifically given the power to receive with it to the Regional Trial Court. What respondent court should have done was to
evidence and perform any and all acts necessary to resolve factual issues raised in conduct the reception of evidence and pass upon the merits of the conflicting
cases falling within its original jurisdiction. 11 Furthermore, under the Supreme allegations of the parties insofar as the petition for a writ of habeas corpus is
Court Resolution dated 11 February 1983 implementing B.P. Blg. 129 pending the concerned.
corresponding thorough revision of the Rules of Court, the Court of Appeals is While We agree with the conclusion reached by respondent court that the case
authorized to conduct a trial or hearing to receive evidence and for the purpose requires a full-blown trial of the facts, the same should be done in the context of
shall observe the procedure prescribed for the trial courts. 12 Clearly, the Court of the special proceedings for custody of minors under Rule 99 of the Rules of Court,
Appeals should not have remanded or referred the petition for a writ of habeas and not a remand or referral of the original action for a writ of habeas corpus filed
corpus to the trial court.: nad with the respondent court. Parenthetically, the proper venue in this action is the
Finally, the questioned decision and resolutions go against the Revised Internal place where the petitioner therein resides. 14 Petitioners' third assigned error is
Rules of the Court of Appeals. 13 Under Rule 6, Section 2(c) (5) thereof, the disposed of accordingly.
proper procedure is as follows: WHEREFORE, the petition for Certiorari is hereby GRANTED. The assailed decision
and resolutions of the respondent Court of Appeals are SET ASIDE and a new one
RULE 6 is rendered DISMISSING the petition for habeas corpus WITHOUT PREJUDICE to

20
the filing by private respondent of the appropriate special proceedings to gain
custody of his minor child. Let copies of this decision be furnished all Members of
the respondent Court of Appeals. No costs.
SO ORDERED.

21
Medical Professional Staff' with substantially the same functions and
[G.R. No. 129132. July 8, 1998] responsibilities, the Commission hereby orders that:
ISABELITA VITAL-GOZON, petitioner, vs. HONORABLE COURT OF APPEALS and ALEJANDRO
DE LA FUENTE, respondents. 1. Appellant dela Fuente, Jr. be retained or considered as never having
relinquished his position of Chief of Clinics (now Chief of Medical
This is a sequel to our decision[1] of 5 August 1992 in G.R. No. 101428, entitled Isabelita Professional Staff) without loss of seniority rights; and
Vital-Gozon v. The Honorable Court of Appeals, et al., which held that the Court of Appeals
had jurisdiction, in a special civil action for mandamus against a public officer (docketed therein 2. He be paid back salaries, transportation, representation and housing
as CA-G.R. SP No. 16438 and entitled Dr. Alejandro S. de la Fuente v. Dr. Isabelita Vital- allowances and such other benefits withheld from him from the date of
Gozon, et al.), to take cognizance of the claim for damages against respondent public officer. his illegal demotion/transfer.
Specifically, the instant petition seeks to reverse the Resolution of 7 May 1997 [2] of
respondent Court of Appeals in CA-G.R. SP No. 16438 awarding to petitioner below, now No motion for reconsideration of this Resolution was ever submitted nor appeal
private respondent, moral and exemplary damages and attorneys fees after hearing the therefrom essayed to the Supreme Court, within the thirty-day period prescribed
evidence thereon sometime after this Courts decision in G.R. No. 101428 became final. therefor by the Constitution. Consequently, the resolution became final, on
September 21, 1988.
The factual antecedents then, as found by us in G.R. No. 101428, must be restated, thus:
De la Fuente thereupon sent two (2) letters to Dr. Vital-Gozon, the Medical Center
In the early months of 1987 -- and pursuant to Executive Order No. 119 issued on Chief of the National Childrens Hospital, demanding implementation of the
January 30, 1987 by President Corazon C. Aquino -- reorganization of the various Commission's decision. Dr. Vital-Gozon referred de la Fuentes claims to the
offices of the Ministry of Health commenced; existing offices were abolished, Department of Health Assistant Secretary for Legal Affairs for appropriate advice
transfers of personnel effected. and/or action xxx (She did this allegedly because, according to the Solicitor General,
At the time of the reorganization, Dr. Alejandro S. de la Fuente was the Chief of she was) unaware when and how a CSC Resolution becomes final and executory,
Clinics of the National Children's Hospital, having been appointed to that position on whether such Resolution had in fact become final and executory and whether the
December 20, 1978. Prior thereto, he occupied the post of Medical Specialist II, a DOH Legal Department would officially assail the mentioned Resolution. But she did
position to which he was promoted in 1977 after serving as Medical Specialist I of not answer Dr. de la Fuentes letters, not even to inform him of the referral thereof to
the same hospital for six (6) years (since 1971). the Assistant Secretary. She chose simply to await legal guidance from the DOH
Legal Department. On the other hand, no one in the DOH Legal Department
On February 4, 1988 Dr. de la Fuente received notice from the Department of Health bothered to reply to Dr. de la Fuente, or to take steps to comply or otherwise advise
that he would be re-appointed Medical Specialist II. Considering this to be a compliance, with the final and executory Resolution of the Civil Service Commission.
demotion by no less than two ranks from his post as Chief of Clinics, Dr. de la In fact, de la Fuente claims that Vital-Gozon had actually threatened to stop paying
Fuente filed a protest with the DOH Reorganization Board. When his protest was xxx (his) salary and allowances on the pretext that he has as yet no 'approved'
ignored, he brought his case to the Civil Service Commission where it was docketed appointment even as Medical Specialist II x x x.
as CSC Case No. 4. In the meantime the duties and responsibilities pertaining to the
position of Chief of Clinics were turned over to and were allowed to be exercised by Three months having elapsed without any word from Vital-Gozon or anyone in her
Dr. Jose D. Merencilla, Jr. behalf, or any indication whatever that the CSC Resolution of August 9, 1988 would
be obeyed, and apprehensive that the funds to cover the salaries and allowances
Dr. de la Fuentes case was decided by the Civil Service Commission in a Resolution otherwise due him would revert to the General Fund, Dr. de la Fuente repaired to the
dated August 9, 1988. In that Resolution, the Commission made the following Civil Service Commission and asked it to enforce its judgment. He was however
conclusion and disposition, to wit: told to file in court a petition for mandamus because of the belief that the
Commission had no coercive powers -- unlike a court -- to enforce its final
xxx (The Commission) declares the demotion/transfer of appellant dela decisions/resolutions.
Fuente, Jr. from Chief of Clinics to Medical Specialist II as null and void:
hence, illegal. Considering further that since the National Children's So he instituted in the Court of Appeals on December 28, 1988 an action of
Hospital was not abolished and the positions therein remained intact mandamus and damages with preliminary injunction to compel Vital-Gozon, and the
although the title or the position of Chief of Clinics was changed to 'Chief of Administrative Officer, Budget Officer and Cashier of the NCH to comply with the
22
final and executory resolution of the Civil Service Commission. He prayed for the (a) Declaring that principal respondent Dr. Jose D. Merencilla, Jr. is not
following specific reliefs: legally entitled to the office of Chief of Clinics (now retitled/known as Chief
of Medical Professional Staff, NCH), ousting him therefrom and ordering
(1) (That) xxx a temporary restraining order be issued immediately, ordering the said respondent to immediately cease and desist from further performing
principal and other respondents to revert the funds of the NCH corresponding as OIC Professional Service any and all duties and responsibilities of the
to the amounts necessary to implement the final resolution of the CSC in CSC said office; (and)
Case No. 4 in favor of herein petitioner, Dr. Alejandro S. de la Fuente, Jr., and (b) Declaring that the petitioner, Dr. Alejandro S. de la Fuente, Jr., is the
to pay such sums which have accrued and due and payable as of the date of lawful or de jure Chief of Clinics (now known as Chief of the Medical
said order; Professional Staff and placing him in the possession of said office/position,
without the need of reappointment or new appointment as held by the Civil
(2) After hearing on the prayer for preliminary injunction, that the restraining order be Service Commission in its resolution of August 9, 1988, in CSC Case No.
converted to a writ of preliminary injunction; and that a writ of preliminary 4.
mandatory injunction be issued ordering principal respondent and the other
respondents to implement in full the said final resolution; and xxx."
Copy of the Supplemental/Amended Petition was sent to Atty. Jose A. Favia,
(3) That, after hearing on the merits of the petition, that judgment be rendered Counsel for Respondents c/o Dr. Ma. Isabelita Vital-Gozon, etc., National Children's
seeking (sic) permanent writs issued and that principal respondent be ordered Hospital, E. Rodriguez Ave., Quezon City (Atty. Fabia's address not being indicated
and commanded to comply with and implement the said final resolution without or mentioned in his motion for Extension of Time).
further delay; and, furthermore, that the principal respondent be ordered to pay
to the petitioner the sums of P100,000.00 and P20,000.00 as moral and Again the Court of Appeals required answer of the respondents. Again, none was
exemplary damages, and P10,000.00 for litigation expenses and attorney's filed. The petitions were consequently resolved on the basis of their allegations and
fees. the annexes. The Appellate Court promulgated its judgment on June 9, 1989. It held
that --
The Court of Appeals required the respondents to answer. It also issued a temporary The question of whether petitioner may be divested of his position as Chief
restraining order as prayed for, and required the respondents to show cause why it of Clinics by the expedient of having him appointed to another, lower
should not be converted to a writ of preliminary injunction. The record shows that the position is no longer an issue. It ceased to be such when the resolution in
respondents prayed for and were granted an extension of fifteen (15) days to file CSC Case No. 4 became final. The said resolution is explicit in its
their answer through counsel, who, as the Court of Appeals was later to point out, mandate; petitioner was declared the lawful and de jureChief of Clinics
did not bother to indicate his address, thus notice was sent to him through the (Chief of the Medical Professional Staff) of the National Childrens Hospital,
individual respondents xxx (However, no) answer was filed; neither was there any and by this token, respondent Dr. Jose D. Merencilla, Jr. is not legally
show cause [sic] against a writ of preliminary injunction. It was a certain Atty. Jose entitled to the office. Respondents, particularly Dr. Isabelita Vital-Gozon,
Fabia who appeared in Vital-Gozon's behalf. had no discretion or choice on the matter; the resolution had to be complied
About a month afterwards, de la Fuente filed with the same Court a with. It was ill-advised of principal respondent, and violative of the rule of
Supplemental/Amended Petition dated February 2, 1989. The second petition law, that the resolution has not been obeyed or implemented.
described as one for quo warranto aside from mandamus, added three respondents
including Dr. Jose Merencilla, Jr.; and alleged inter alia that he (de la Fuente) had and accordingly ordered
clear title to the position in question [by] virtue of the final and executory judgment of
the Civil Service Commission; that even after the Commission's judgment had xxx respondents, particularly Dr. Isabelita Vital-Gozon, xxx to forthwith
become final and executory and been communicated to Vital-Gozon, the latter comply with, obey and implement the resolution in CSC Case No. 4 (and)
allowed Dr. Merencilla, Jr. as OIC Professional Service to further usurp, intrude into xxx Dr. Jose D. Merencilla, Jr., who is not entitled to the office, xx to
and unlawfully hold and exercise the public office/position of petitioner (under a duly immediately cease and desist from further performing and acting as OIC
approved permanent appointment as Chief of Clinics since 1978). De la Fuente thus Professional Service.
prayed, additionally, for judgment:
23
But de la Fuente's prayer for damages -- founded essentially on the refusal of July 14, they had not complied therewith. By Resolution dated July 26, 1989, the
Gozon, et al. to obey the final and executory judgment of the Civil Service Court required Gozon and Merencilla to appear before it on August 3, 1989 to
Commission, which thus compelled him to litigate anew in a different forum -- was answer the charge and show cause why they should not be adjudged in contempt
denied by the Court of Appeals on the ground that the petitions (for mandamus) are for disobeying and/or resisting the judgment.
not the vehicle nor is the Court the forum for xxx (said) claim of damages.
At the hearing Gozon and Merencilla duly presented themselves, accompanied by
Gozon acknowledged in writing that she received a copy of the Appellate Tribunal's their individual private lawyers -- one for Gozon (Felipe Hidalgo, Jr.), two for
Decision of June 9, 1989 on June 15, 1989. Respondent de la Fuente acknowledged Merencilla (Bernardo S. Nera and Moises S. Rimando). One other lawyer appeared
receipt of his own copy on June 15, 1989. Neither Vital-Gozon nor her co-party, Dr. in their behalf, from the Health Department, Artemio Manalo, who stated that he was
Merencilla, Jr., moved for reconsideration of, or attempted to appeal the decision. there in behalf of Jose A. Fabia. They explained that they had no intention to defy
the Court, they had simply referred the matter to their superiors in good faith; and
It was de la Fuente who sought reconsideration of the judgment, by motion filed they were perfectly willing to comply with the judgment, undertaking to do so even in
through new counsel, Atty. Ceferino Gaddi. He insisted that the Appellate Court had the afternoon of that same day. The Court consequently ordered them "to comply
competence to award damages in a mandamus action. He argued that while such a with their undertaking xxx without any further delay, and report the action taken
claim for damages might not have been proper in a mandamus proceeding in the towards this end, within five (5) days.
Appellate Court before the enactment of B.P. Blg. 129 because the Court of Appeals
had authority to issue such writs only in aid of its appellate jurisdiction, the situation On August 9, 1989, Gozon, as Medical Center Chief, sent a letter to Associate
was changed by said BP 129 in virtue of which three levels of courts -- the Supreme Justice Pedro A. Ramirez, advising that under Hospital Special Order No. 31 dated
Court, the Regional Trial Court, and the Court of Appeals -- were conferred August 3, 1989, de la Fuente had been directed to assume the position of Chief of
concurrent original jurisdiction to issue said writs, and the Court of Appeals was the Medical Professional Staff, and that a voucher for the payment of his allowances
given power to conduct hearings and receive evidence to resolve factual issues. To had been prepared and was being processed.
require him to separately litigate the matter of damages, he continued, would lead to
that multiplicity of suits which is abhorred by the law. More than a month later, or more precisely on September 27, 1989, the Court of
Appeals promulgated another Resolution, this time resolving de la Fuente's motion
While his motion for reconsideration was pending, de la Fuente sought to enforce for reconsideration of June 29, 1989. It modified the Decision of June 9, 1989 by (a)
the judgment of the Court of Appeals of June 9, 1989 -- directing his reinstatement deleting its last paragraph (disallowing the claim of damages, supra), (b)
pursuant to the Civil Service Commissions Resolution of August 9, 1988, supra. He consequently describing and treating it as a PARTIAL DECISION, and (c)
filed on July 4, 1989 a Motion for Execution, alleging that the judgment of June 9, scheduling further proceedings for the purpose of receiving evidence (of damages),
1989 had become final and executory for failure of Gozon, et al. -- served with notice since said question cannot be resolved by mere reference to the pleadings. This was
thereof on June 16, 1989 -- to move for its reconsideration or elevate the same to done in reliance on Section 3, Rule 65 of the Rules of Court, invoked by de la
the Supreme Court. His motion was granted by the Court of Appeals in a Resolution Fuente, which reads as follows:
dated July 7, 1989, reading as follows:
SEC. 3. Mandamus. -- When any tribunal, corporation, board, or person
The decision of June 9, 1989 having become final and executory, as unlawfully neglects the performance of an act which the law specifically
prayed for, let the writ of execution issue forthwith. enjoins as a duty resulting from an office, trust, or station, or unlawfully
excludes another from the use and enjoyment of a right or office to which
The corresponding writ of execution issued on July 13, 1989, on the invoked such other is entitled, and there is no other plain, speedy and adequate
authority of Section 9, Rule 39. The writ quoted the dispositive portion of the remedy in the ordinary course of law, the person aggrieved thereby may file
judgment of June 9, 1989, including, as the Solicitor Generals Office points out, the a verified petition in the proper court alleging the facts with certainty and
second paragraph to the effect that the petitions are not the vehicle nor is the Court praying that judgment be rendered commanding the defendant,
the forum for the claim of damages; (hence,) the prayer therefor is denied. immediately or at some other specified time, to do the act required to be
The writ of execution notwithstanding, compliance with the June 9, 1989 judgment done to protect the rights of the petitioner, and to pay the damages
was not effected. Consequently, de la Fuente filed, on July 20, 1989, an Urgent Ex sustained by the petitioner by reason of the wrongful acts of the defendant.
ParteManifestation with Prayer to Cite Respondents for Contempt, complaining that At about this time, yet another lawyer, Atty. Pedro F. Martinez entered his
although Gozon and her co-parties had been served with the writ of execution on appearance for Isabelita Gozon. At his instance, the Court gave him an opportunity
24
to xxx file a motion for reconsideration of the Resolution of September 27, In its resolution of 26 October 1995,[5] the Court of Appeals, inter alia, set the hearing for
1989. That motion he filed by registered mail on November 10, 1989. His basic reception of evidence on the matter of damages on 7 December 1995.
contentions were (a) that the decision of June 9, 1989 could no longer be altered,
having become final and executory and having in fact been executed, and (b) that After de la Fuente presented his evidence, the Court of Appeals set reception of Vital-
under BP 129, the Appellate Court had no jurisdiction over the question of damages Gozons evidence on 16 and 17 January 1996.[6]
in a mandamus action. At the scheduled hearing on 16 January 1996, Conrado M. Dela Fuente sought to block
The Office of the Solicitor General also put in an appearance in Gozon's behalf at the presentation of Vital-Gozons evidence on the ground that the former had not filed an
this juncture, saying that the case had been referred to it only on November 14, answer, which the latter refuted. The hearing was then reset to other dates for the parties to
1989. It, too, sought reconsideration of the Resolution of September 27, 1989. It filed prove their respective claims. Vital-Gozon submitted, on 18 January 1996, copies of a
on November 16, 1989 an Omnibus Motion: I. For Reconsideration of Resolution Manifestation and Motion dated 10 September 1992 to which was attached an Answer likewise
dated September 27, 1989; and II. To defer hearing on petitioner's claims for dated 10 September 1992. It was claimed in the Manifestation that the answer to the claim for
damages. damages could not have been filed earlier as the jurisdiction of the Court of Appeals over de la
Fuentes claim for damages had been questioned before the Supreme Court. Vital-Gozon
Both motions were denied by the Court of Appeals in a Resolution dated January 11, likewise claimed that copies of the Manifestation and Motion were received by the Court of
1991. In that Resolution, the Court Appeals on 18 September 1992 at 3:40 p.m. and sent by registered mail to counsel for dela
Fuente.[7] The filing of the Manifestation and Motion with the Court of Appeals was confirmed
1) declared that the amended decision had already become final and could by Remigio M. Escalada, Jr., Division Clerk of Court of the Fifth Division of the Court of
no longer be re-opened because, although a copy of the amendatory Appeals in an undated Report.[8] He further disclosed that the pleading was transmitted to the
resolution was received by counsel who was representing Gozon on Archives Section on 19 September 1992.
October 3, 1989, the first motion for reconsideration was not mailed until
November 10, 1989 and the Solicitor Generals Omnibus Motion was not The Court of Appeals then ordered the parties to submit their respective
filed until November 16, 1989; and memoranda,[9] after which, the Court of Appeals promulgated, on 20 March 1997, a resolution
denying petitioners motion to admit her Answer to the petition and supplemental/amended
2) prohibited the Solicitor General from representing Gozon in connection petition for mandamus with damages, on the ground that the period to file the answer had long
with xx (de la Fuentes) claim for damages, on the authority of this Courts prescribed, thus:
ruling promulgated on March 19, 1990 in G.R. No. 87977 (Urbano, et al. v.
Chavez, et al.) and G.R. No. 88578 (Co v. Regional Trial Court of Pasig). It was too late that the answer was filed in this Court on September 18, 1992, after
promulgation on August 5, 1992, of the decision of the Supreme Court in G.R. No.
Notice of this Resolution of January 11, 1991 was served on the Solicitor Generals 101428. The prescribed period to file such answer as well as the extended period
Office on January 18, 1991. Again the Solicitor General sought reconsideration, by had long expired on January 24, 1989 (pp. 35, 37, 55, Rollo) by the time
motion dated January 25, 1991 and filed on January 30, 1991. Again it was rebuffed. respondents answer was filed in this Court on September 18, 1992. She had another
In a Resolution rendered on August 7, 1991, served on the Solicitor Generals Office opportunity to answer when petitioner filed a supplemental/amended petition. (pp.
on August 20, 1991, the Court of Appeals denied the motion. It ruled that the 57, 72, Rollo). Still, she filed none. It is evident respondent just ignored the case filed
question of the authority of the Solicitor General to appear as counsel for respondent against her or gave no importance to the petitions and the notices sent to her by this
Gozon xxx (had already) been extensively discussed, and that its jurisdiction xxx to Court. The delay in filing her answer is inexcusable.
hear and determine issues on damages proceeds from Sec. 9, Batas Pambansa 129
as amended. After promulgation and upon finality of this Courts decision granting the principal
relief sought by the petitioner, the instant case for mandamus was virtually disposed
In an attempt to nullify the adverse dispositions of the Court of Appeals -- and obtain of with the exception of the incidental damages that petitioner has claimed. It was
the ultimate and corollary relief of dismissing respondent de la Fuentes claim for uncontested in view of respondents failure to answer the petition setting up her
damages - the Solicitor Generals Office has instituted the special civil action defenses. Consequently, the allegations in the petition and supplemental petition
of certiorari at bar. It contends that the Court of Appeals is not legally competent to were deemed admitted; unpleaded defenses were deemed waived and any
take cognizance of and decide the question of damages in a mandamus suit. xxx[3] counterclaim not set up, barred (Sections 1, 2 and 4, Rule 9, Revised Rules of
On 5 May 1993, the Court of Appeals issued a Resolution[4] which noted that our decision Court). Such procedural rules would become meaningless unless strictly complied
in G.R. No. 101428 had become final and left the option to reopen the case to de la Fuente.
25
with by litigants. As clearly indicated in the proposed answer, respondents purpose 5) the extension granted by said Court of Appeals within which to file answer, notice
is to set up a counterclaim already barred and to plead defenses already waived. thereof having been sent directly to her and her co-respondents since the
attorney who sought the extension in their behalf (Atty. Fabia) did not set out
Besides, the parties as well as this Court are bound by the comprehensive findings his address in his motion for extension;
and conclusions of the Supreme Court in its final decision in G.R. No. 101428,
based on the uncontroverted allegations of the verified petitions. So are they bound
thereby in this proceeding which deals with the lone issue of incidental damages 6) the supplemental/amended petition subsequently presented by de la Fuente, copy
claimed by petitioner. What remains to be done by this Court is but the determination of which was sent to Atty. Fabia, c/o Dr. Vital-Gozon; and
of whether respondents wrongful act or refusal/failure to perform an official duty
caused injury to the claimant and the amount of the damages that may be awarded 7) the Decision and Amendatory Decision sent to her counsel on October 3, 1989.
in his favor.[10]
To all these, her reaction, and that of the officials of the Department of Health concerned, was
Respondent court then set the hearing of the case on 22-23 April 1997 for the presentation of a regrettably cavalier one, to say the least. Neither she nor the Health officials concerned
[Vital-Gozons] evidence to controvert or rebut that of [de la Fuente] which he has adduced in accorded said acts and events any importance. She never bothered to find out what was being
support of his claim for damages. done to contest or negate de la Fuentes petitions and actions, notwithstanding that as time
In its resolution[11] of 21 April 1997, the Court of Appeals denied petitioners motion to went by, de la Fuentes efforts were being met with success.
reconsider[12] the 20 March 1997 resolution.
Nothing in the record even remotely suggests that Vital-Gozon merits relief from the final and
Petitioner then opted not to present her evidence, as she intended to file a petition with executory Resolution of the Civil Service Commission. This Court will not disturb that
the Supreme Court questioning the validity of the 20 March 1997 resolution and 21 April 1997 Resolution. It is satisfied that no procedural or substantive errors taint that Resolution, or its
order of the Court of Appeals.[13] becoming final and executory.
On 7 May 1997, the Court of Appeals promulgated a Resolution[14] finding petitioner liable
for damages and ordered her to pay private respondent P50,000.00 as moral The Court of Appeals then considered the evidence for private respondent and the
damages, P20,000.00 as exemplary damages and P10,000.00 as attorneys fees. In support applicable law, thus:
thereof, respondent court quoted our finding in G.R. No. 101428,[15] to wit:
Upon respondents continued refusal without justifiable cause to implement the final
resolution of the Civil Service Commission upholding petitioners right to the position
The record demonstrates that Vital-Gozon was fully aware of the following acts and events: he has been claiming with back salaries, transportation, representation and housing
allowances and other benefits withheld from him, petitioner is entitled to the
1) the proceeding commenced by de la Fuente in the Civil Service Commission in damages he claims.Testifying in his own behalf petitioner declared that he was
protest against his demotion; greatly disturbed, shocked and frustrated during the three months preceding the
filing of his petition; that he had sleepless nights and suffered from mental anxiety,
2) the Commissions Resolution of August 9, 1988 as well, particularly, as the mental anguish, worry, tension and humiliation when respondent ignored and
direction therein that de la Fuente be reinstated and paid all his back salaries disregarded the final resolution of the Civil Service Commission; that he felt
and other monetary benefits otherwise due him, this being couched in fairly harassed by her refusal because he had to go to court to obtain relief and had to
simple language obviously understandable to persons of ordinary or normal incur additional expenses for litigation which he could hardly afford; and that he had
intelligence; to spend no less than P5,000 for court fees and incidental expenses and to pay his
counsel P10,000 at the end of the litigation (pp. 6, 7, 12, 13, t.s.n., Dec. 7, 1995). All
3) no less than two (2) written demands of de la Fuente for implementation of the these respondent has not successfully rebutted by her evidence since she adduced
CSCs aforesaid Resolution of August 9, 1988; none in her behalf.
Petitioner, therefore, is entitled to recover moral damages from respondent for her
4) the petition filed by de la Fuente in the Court of Appeals for enforcement of the refusal and neglect without just cause to perform her official duty to reinstate
CSC Resolution of August 9, 1988; petitioner to the position he was entitled, as ordered by the Civil Service Commission
in its decision. While he was reinstated to his position, petitioner had to seek the aid
26
of the courts for that purpose. In point is the case of San Luis vs. Court of Appeals, As to exemplary damages, petitioner asserts that she did not act with vindictiveness nor
decided by the Supreme Court on June 26, 1989 (174 SCRA 258, 276), which wantonness, hence the award of said damages was unwarranted,[17] as such, there could
involves the unlawful suspension and dismissal by a Provincial Governor of a quarry likewise be no basis for the award of attorneys fees.[18]
superintendent and the Governors obstinate refusal to comply with the final decisions
of the Civil Service Commission and the Office of the President which declared said Anent the second ground, petitioner contends that she was sued in her official capacity,
suspension and dismissal unlawful or without just cause. The Supreme Court held hence could not be held liable for damages, and to hold otherwise would violate her right to
that the Governor (who was sued both in his official and private capacities) was due process as a private individual, citing Cario v. Agricultural Credit and Cooperative
personally liable for the damages claimed and awarded in favor of the offended Financing Administration[19] and Animos v. Philippine Veterans Affairs Office.[20]
party P50,000 as moral damages and P20,000 for attorneys fees and litigation Petitioner further argues that the Court of Appeals denied her due process by refusing to
expenses. Tan Kapoe vs. Masa, decided January 21, 1985 (134 SCRA 231), is also admit her answer, considering that: (a) she personally attended each and every hearing of
pertinent. There the Supreme Court upheld the award of moral damages although it the mandamus case; (b) in its decision of 9 June 1989, the Court of Appeals explicitly declared
was made on the basis of documentary evidence x x x without supporting oral that it was not the proper forum for the claim for damages, at which point then the necessity of
testimonies. And the award of exemplary damages, in addition to moral damages, an answer had become moot; (c) it was only on 27 September 1989 that the Court of Appeals
was also deemed proper even if not expressly pleaded in the complaint nor reconsidered its decision of 9 June 1989 thereby upholding its jurisdiction to hear the claims for
proved. Such award of exemplary damages is by way of example or correction for the damages; (d) but then, consistent with her stand that the Court of Appeals had no jurisdiction
public good, in addition to moral damages (Article 2229, Civil Code). Inasmuch as over the claims for damages, she assailed such ruling before this Court, hence she could not
petitioner is entitled to exemplary damages, he should be awarded attorneys have been expected to file an answer; (e) nonetheless, upon receipt of the adverse decision of
fees. The award in favor of petitioner of moral and exemplary damages are attorneys this Court of 4 August 1992 in G.R. No. 101428, she immediately filed her answer with a
fees in the amounts of P50,000, P20,000 and P10,000, respectively, is but fair and corresponding motion for its admission; and (f) while her motion for admission of the answer
just and not excessive.[16] had been pending since 18 October 1992, the Court of Appeals did not act on it until it was
Unsatisfied, petitioner forthwith filed the instant petition for review on certiorari under Rule already her turn to present her evidence on the claim for damages.
45 of the Rules of Court. She prays that we reverse and set aside the challenged Resolution In his comment on the petition submitted in compliance with the Resolution of 21 July
on the following grounds: 1997, private respondent contends that: (a) petitioners incomplete and slanted version of the
1. There is absolutely no ground for the award of moral and exemplary damages, as well facts of the case cannot be relied upon; (b) the factual findings of this Court in G.R. No.
as attorneys fees. 101428 are conclusive and binding, hence the Court of Appeals did not err nor abuse its
discretion in relying on said findings; (c) petitioners invocation of state immunity is untenable as
2. Petitioners right to due process was violated. she was sued not in her official capacity, and assuming otherwise, petitioner could
nevertheless be held liable for damages under Articles 20, 27 and 2176 of the Civil Code and
Anent the first ground, petitioner asserts there is no factual basis for the award of moral Section 3, Rule 65 of the Rules of Court; (d) the Court of Appeals did not err in denying
damages for, concretely, private respondent was unable to show any causal connection petitioners motion to admit her answer; and (e) the Court of Appeals awards of moral and
between his supposed injury and petitioners alleged actionable wrong. Petitioner argues that exemplary damages and attorneys fees were proper, fair, reasonable, justified and in accord
while testifying, private respondent simply made generalized statements that he had sleepless with the law and precedent.
nights and suffered mental anxiety, mental anguish, worry, tension and humiliation. Petitioner
next reiterates her stand that she had nothing to do with the Civil Service case relative to Two principal issues thus confront us, viz: (a) whether petitioner was denied due process
respondents original position, as she was not yet connected with the NCH when said case was when her answer to the petition was not admitted; and (b) whether the awards of moral and
filed. Moreover, the failure to immediately reinstate private respondent was caused by the exemplary damages and attorneys fees were proper. These will be resolved in seriatim.
directive of the Legal Department of the Department of Health, to which office she forwarded
the decision of the Civil Service Commission for guidance, pursuant to standard I
procedure. Petitioner, therefore, acted in good faith. She likewise faults the Court of Appeals We do not hesitate to rule that petitioner was not denied due process. The record of CA-
for considering our observations in G.R. No. 101428 as factual findings which bound G.R. SP No. 16438 shows that in the resolution of 29 December 1998, the Court of Appeals
respondent court. gave due course to private respondents petition and required herein petitioner and the other
respondents to answer the petition within 10 days from notice of the resolution. [21] On 9
January 1988, petitioner and the other respondents, represented by Atty. Jose Fabia, filed a

27
motion for an extension of 15 days from said date within which to file their answer, which Supplemental/Amended Petition, and in light of her failure to file her answer to the original
respondent court granted in its resolution of 17 January 1989. [22] Likewise, on 17 January petition despite the grant of her motion for extension of time to file it, then the case was
1989, private respondent, as petitioner below, was granted leave to file a automatically deemed submitted for decision. After the decision was rendered, she could then
supplemental/amended petition.[23] no longer be heard to raise a defense which, by her inaction, she indubitably expressed no
desire to raise.
The Supplemental/Amended Petition was filed on 3 February 1989, [24] and in the
resolution of 9 February 1989,[25] the Court of Appeals required petitioner herein and her co- It cannot then be successfully maintained that the Court of Appeals committed reversible
respondents in CA-G.R. SP No. 16438 to file their answer thereto within 10 days from error, much less, grave abuse of discretion, when it denied admission to an answer that was
notice. However, no such answer was filed, and on 9 June 1989, the Court of Appeals filed only after this Courts decision in G.R. No. 101428 had long become final and immutable.
rendered its decision.[26] De la Fuente seasonably filed a motion for
reconsideration,[27] principally as regards the holding that the petitions are not the vehicle nor is What further militates against petitioners advocacy is that the Court of Appeals, aside from
the Court the forum for the claim of damages. A copy of this motion was furnished counsel for affording petitioner an opportunity to be heard through the filing of pleadings, likewise
respondents. Respondents therein were then required, in the resolution of 5 July 1989, [28] to sustained petitioners right to due process at the hearing. What petitioner neglects to mention is
comment within 10 days from notice. However, respondents below once more failed to comply. that respondent court did not deprive her the right to cross-examine private respondent when
Thus, on 27 September 1989, the Court of Appeals promulgated a resolution[29] granting the the latter testified as to the matter of damages. Through the exercise of the right, petitioner
motion for reconsideration by deleting therefrom the challenged portion of its decision of 9 could have negated private respondents claims by showing the absence of legal or factual
June 1989. Respondent court then set reception of evidence on the claims for damages on 9 basis therefor. Moreover, the Court of Appeals explicitly allowed petitioner to present her
and 11 of October 1989. evidence against the claim for damages. However, petitioner again failed to take the
opportunity to have herself heard.
Respondents below, represented by new counsel, Atty. Pedro Martinez, and the rest by
the Office of the Solicitor General, filed motions to reconsider the resolution of 27 September It may be pointed out that in her Answer,[31] she interposed the following defenses against
1989, primarily on the ground that the Court of Appeals had no jurisdiction over the claim for the claim for moral and exemplary damages and attorneys fees, namely: (1) the claim was
damages in the petition for mandamus. The incidental issue of the authority of the Solicitor effectively and exclusively a suit against the State, but without its consent; (2) she had not
General to appear for herein petitioner in respect of the claim for damages against her in her committed any actionable wrong as she acted in good faith and without malice or negligence;
personal capacity was also raised. These matters became the subject of various pleadings. and (3) whatever injury private respondent may have suffered were mere consequences of his
indiscretion, negligence and/or ignorance of the law which, at best, constituted damnum
Eventually, on 11 January 1991, the Court of Appeals promulgated a resolution [30] which absque injuria. From the nature of these defenses, they could very well have been taken up,
gave rise to G.R. No. 101428, after the Court of Appeals denied herein petitioners motion for even indirectly, on cross-examination of private respondent or in the course of petitioners
reconsideration. testimony had she chosen to present her evidence. All told, the above discussion should
readily refute petitioners claim of a denial of due process.
Clearly, therefore, petitioners failure to file the answer to the petition was due to her fault
or negligence. She was, by formal resolutions of the Court of Appeals, required to file answers II
to both the original petition and the Supplemental/Amended Petition; yet, she failed to heed
both resolutions. As regards the resolution to answer the Supplemental/Amended Petition, Moral damages include physical suffering, mental anguish, fright, serious anxiety,
herein petitioner totally disregarded the same. And if only to further evince that herein besmirched reputation, wounded feelings, moral shock, social humiliation, and similar
petitioner had no one to blame but herself for her plight, as regards the resolution to answer injury. They may be recovered if they are the proximate result of the defendants wrongful act or
the original petition, this she spurned despite the fact that she asked for and was granted an omission.[32] The instances when moral damages may be recovered are, inter alia, acts and
extension of 15 days within which to do so. That she questioned the jurisdiction of the Court of actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34 and 35 of the Civil Code, [33] which,
Appeals over the claims for damages is entirely irrelevant, considering that she did so only in turn, are found in the Chapter on Human Relations of the Preliminary Title of the Civil
after the Court of Appeals promulgated its Resolution of 27 September 1989. Up to that time, Code. Relevant to the instant case, which involves public officers, is Article 27, [34] which
petitioner had absolutely no responsive pleading setting forth her defense. provides:

It may likewise be stressed that under Section 2.c.(4) of the Revised Internal Rules of the ART. 27. Any person suffering material or moral loss because a public servant or employee
Court of Appeals then in force, after the expiration of the period for filing the answer or the refuses or neglects, without just cause, to perform his official duty may file an action for
reply in special civil actions, a case is deemed submitted for resolution. Thus, after the damages and other relief against the latter, without prejudice to any disciplinary administrative
expiration of the 10-day period granted to herein petitioner to file her Answer to the action that may be taken.
28
Article 27 must then be read in conjunction with Section 1 of Article XI (Accountability of Public That petitioner then committed an actionable wrong for unjustifiably refusing or neglecting
Officers) of the Constitution,[35] which provides: to perform an official duty is undeniable. Private respondent testified on the moral damages
which he suffered by reason of such misfeasance or malfeasance of petitioner, and the
Section 1. Public office is a public trust. Public officers and employees must at all times be attorneys fees and litigation expenses he incurred to vindicate his rights and protect his
accountable to the people, serve them with utmost responsibility, integrity, loyalty, and interests.The Court of Appeals which heard him gave full faith and credit to his
efficiency, act with patriotism and justice, and lead modest lives. testimony. Private respondent declared that by reason of the unjust action or refusal of
petitioner when she did not recognize, ignored and disregarded the final and executory Civil
It is thus evident that under Article 27, in relation to Articles 2219 and 2217 of the Civil Service Resolution, he:
Code, a public officer, like petitioner herein, may be liable for moral damages for as long as the
moral damages suffered by private respondent were the proximate result of petitioners [W]as actually greatly disturbed, shocked and frustrated during those three ...
wrongful act or omission, i.e., refusal to perform an official duty or neglect in the performance months. [He] had sleepless nights and ... suffered from mental anxiety, worry, tension
thereof.In fact, if only to underscore the vulnerability of public officials and employees to suits and humiliation...[39]
for damages to answer for any form or degree of misfeasance, malfeasance or nonfeasance,
this Court has had occasion to rule that under Articles 19 and 27 of the Civil Code, a public Private respondents anguish even continued during the 5-month period while the case was
official may be made to pay damages for performing a perfectly legal act, albeit with bad faith pending with the Court of Appeals, thus:
or in violation of the abuse of right doctrine embodied in the preliminary articles of the Civil
Code concerning Human Relations.[36] During this period my sleepless nights and my moral sufferings continued. As a matter of fact,
Exemplary damages may be imposed by way of example or correction for the public good, even worsened. I just could not understand, actually I could not understand the action here of
in addition to the moral, temperate, liquidated or compensatory damages.[37] Dr. Gozon for having not followed the decision of the Court of Appeals. And that is why I felt
very much aggrieved during this period. I could not sleep at all and this has weakened me.[40]
Attorneys fees and other expenses of litigation may be recovered as actual or
compensatory damages when, inter alia, exemplary damages are awarded; when the Private respondent further testified that he spent not less than P5,000.00 for court fees and as
defendant acted in gross and evident bad faith in refusing to satisfy the plaintiff's plainly valid, incidental expenses and had committed himself to pay P10,000.00 to his counsel at the end of
just and demandable claim, and in any other case where the court deems it just and equitable the case.[41]
that attorneys fees and expenses of litigation should be recovered.[38]
While private respondent did not quantify the extent of his moral damages, the Court of
There can be no question that private respondent was entitled to be restored to his Appeals fixed the same at P50,000.00. Since moral damages are, in the language of Article
position as Chief of Clinics by virtue of the final and executory decision of the Civil Service 2217 of the Civil Code, incapable of pecuniary estimation, courts have the discretion to fix the
Commission. Petitioner, as head or chief of the National Childrens Hospital, then had the duty corresponding amount, not being bound by any self-serving assessment by the claimants. On
to see to it that the decision be obeyed and implemented. This she failed to do and private the other hand, a claimants failure to state the monetary value of moral damages suffered
respondents two official demands for compliance with the Civil Service Commissions decision presents no legal obstacle to a courts determination thereof, as long as there is factual basis
were merely referred by petitioner to the Legal Department of the Department of Health; and for the award such as the claimants testimony as to his sufferings. As a matter of fact, it is not
as further noted by this Court in its decision in G.R. No. 101428, she did not answer [private unusual for claimants to leave the determination of the amount of the award to the discretion of
respondents] letters not even to inform him of the referral thereof to the Assistant Secretary [for the court.
Legal Affairs]. She chose simply to await legal guidance from the DOH Legal Department. This
Court further noted: Under Article 2233 of the Civil Code, exemplary damages cannot be recovered as a
matter of right; the court will decide whether or not they should be adjudicated. In the instant
To all these, [petitioners] reaction, and that of the officials of the Department of Health case, the Court of Appeals awarded exemplary damages in the amount
concerned, was a regrettably cavalier one, to say the least. Neither she nor the Health of P20,000.00. Considering that a public official is the culprit here, the propriety of such an
Department officials concerned accorded said acts and events any importance. She never award cannot be questioned. It serve as an example or deterrent so that other public officials
bothered to find out what was being done to contest or negate [private respondents] petitions be always reminded that they are public servants bound to adhere faithfully to the
and actions, notwithstanding that as time went by, [private respondents] efforts were being met constitutional injunction that a public office is a public trust. That the aggrieved party happened
with success. to be another public official will not serve to mitigate the effects of petitioners having failed to
observe the required degree of accountability and responsibility.
29
As to attorneys fees as actual damages, the Court of Appeals determination of its
propriety in this case and the extent thereof were well within its discretion. The agreement
between private respondent and his counsel as to the amount does not control.
Petitioners contention that she cannot be liable for damages since she was sued in her
official capacity is without merit. Whether petitioner was impleaded as respondent in an official
capacity, i.e., solely in her capacity as Chief of the National Childrens Hospital, is best
determined from the Petition as well as the Supplemental/Amended Petition. For one, in the
captions in both, she is named as one of the respondents without any express mention that
she was so sued in her capacity, as Chief of the National Childrens Hospital. For another, the
allegations in the body of the Petition clearly show that she was sued in both her official and
private capacities. As to the former, paragraphs 1 and 7 respectively allege petitioners position
as a public official, and specifically as Head of the Childrens Hospital; her duty to restore
private respondent to his position by virtue of the final decision of the Civil Service
Commission; and her refusal to allow private respondent to perform and discharge his duties
and responsibilities as Chief of Clinics. As to the latter, paragraph 16 of the Petition explicitly
speaks of petitioners personal liability, thus:

16. For causing such mental suffering and anguish, etc.,[42] principal respondent [herein
petitioner] ought to and must be, in accordance with the Civil Code, held personally
answerable and liable to the petitioner in the sum of not less than P100,000.00 as moral
damages, and another sum of P20,000.00 as exemplary damages, by way of example or
correction for the public good.[43] (emphasis supplied)

In maintaining then that she was sued merely in her official capacity, petitioner has either
overlooked paragraph 16 or sought to deliberately mislead this Court.
WHEREFORE, for utter failure to show that respondent Court of Appeals committed
reversible error in the challenged resolutions, the instant petition is denied.
Costs against petitioner.
SO ORDERED.

30
[G.R. No. 130866. September 16, 1998] legislative changes introduced over the years into the provisions of Presidential Decree (P.D.)
ST. MARTIN FUNERAL HOME, petitioner, vs. NATIONAL LABOR RELATIONS No. 442 (The Labor Code of the Philippines and Batas Pambansa Blg. (B.P. No.) 129 (The
MARTINEZ, COMMISSION and BIENVENIDO ARICAYOS, respondents. Judiciary Reorganization Act of 1980) now stridently call for and warrant a reassessment of
that procedural aspect.
The present petition for certiorari stemmed from a complaint for illegal dismissal filed by
herein private respondent before the National Labor Relations Commission (NLRC), Regional We prefatorily delve into the legal history of the NLRC. It was first established in the
Arbitration Branch No. III, in San Fernando, Pampanga. Private respondent alleges that he Department of Labor by P.D. No. 21 on October 14, 1972, and its decisions were expressly
started working as Operations Manager of petitioner St. Martin Funeral Home on February 6, declared to be appealable to the Secretary of Labor and, ultimately, to the President of the
1995. However, there was no contract of employment executed between him and petitioner nor Philippines.
was his name included in the semi-monthly payroll. On January 22, 1996, he was dismissed
from his employment for allegedly misappropriating P38,000.00 which was intended for On May 1, 1974, P.D. No. 442 enacted the Labor Code of the Philippines, the same to
payment by petitioner of its value added tax (VAT) to the Bureau of Internal Revenue (BIR). [1] take effect six months after its promulgation.[8] Created and regulated therein is the present
NLRC which was attached to the Department of Labor and Employment for program and policy
Petitioner on the other hand claims that private respondent was not its employee but only coordination only.[9] Initially, Article 302 (now, Article 223) thereof also granted an aggrieved
the uncle of Amelita Malabed, the owner of petitioner St. Martins Funeral Home. Sometime in party the remedy of appeal from the decision of the NLRC to the Secretary of Labor, but P.D.
1995, private respondent, who was formerly working as an overseas contract worker, asked for No. 1391 subsequently amended said provision and abolished such appeals. No appellate
financial assistance from the mother of Amelita. Since then, as an indication of gratitude, review has since then been provided for.
private respondent voluntarily helped the mother of Amelita in overseeing the business.
Thus, to repeat, under the present state of the law, there is no provision for appeals from
In January 1996, the mother of Amelita passed away, so the latter she took over the the decision of the NLRC.[10] The present Section 223, as last amended by Section 12 of R.A.
management of the business. She then discovered that there were arrears in the payment of No. 6715, instead merely provides that the Commission shall decide all cases within twenty
taxes and other government fees, although the records purported to show that the same were days from receipt of the answer of the appellee, and that such decision shall be final and
already paid. Amelita then made some changes in the business operation and private executory after ten calendar days from receipt thereof by the parties.
respondent and his wife were no longer allowed to participate in the management thereof. As a
consequence, the latter filed a complaint charging that petitioner had illegally terminated his When the issue was raised in an early case on the argument that this Court has no
employment.[2] jurisdiction to review the decisions of the NLRC, and formerly of the Secretary of Labor, since
there is no legal provision for appellate review thereof, the Court nevertheless rejected that
Based on the position papers of the parties, the labor arbiter rendered a decision in favor thesis. It held that there is an underlying power of the courts to scrutinize the acts of such
of petitioner on October 25, 1996 declaring that no employer-employee relationship existed agencies on questions of law and jurisdiction even though no right of review is given by statute;
between the parties and, therefore, his office had no jurisdiction over the case. [3] that the purpose of judicial review is to keep the administrative agency within its jurisdiction
and protect the substantial rights of the parties; and that it is that part of the checks and
Not satisfied with the said decision, private respondent appealed to the NLRC contending balances which restricts the separation of powers and forestalls arbitrary and unjust
that the labor arbiter erred (1) in not giving credence to the evidence submitted by him; (2) in adjudications.[11]
holding that he worked as a volunteer and not as an employee of St. Martin Funeral Home
from February 6, 1995 to January 23, 1996, or a period of about one year; and (3) in ruling that Pursuant to such ruling, and as sanctioned by subsequent decisions of this Court, the
there was no employer-employee relationship between him and petitioner.[4] remedy of the aggrieved party is to timely file a motion for reconsideration as a precondition for
any further or subsequent remedy,[12] and then seasonably avail of the special civil action of
On June 13, 1997, the NLRC rendered a resolution setting aside the questioned decision certiorari under Rule 65,[13] for which said Rule has now fixed the reglementary period of sixty
and remanding the case to the labor arbiter for immediate appropriate proceedings. [5] Petitioner days from notice of the decision.Curiously, although the 10-day period for finality of the
then filed a motion for reconsideration which was denied by the NLRC in its resolution dated decision of the NLRC may already have lapsed as contemplated in Section 223 of the Labor
August 18, 1997 for lack of merit,[6] hence the present petition alleging that the NLRC Code, it has been held that this Court may still take cognizance of the petition for certiorari on
committed grave abuse of discretion.[7] jurisdictional and due process considerations if filed within the reglementary period under Rule
Before proceeding further into the merits of the case at bar, the Court feels that it is now 65.[14]
exigent and opportune to reexamine the functional validity and systemic practicability of the Turning now to the matter of judicial review of NLRC decisions, B.P. No. 129 originally
mode of judicial review it has long adopted and still follows with respect to decisions of the provided as follows:
NLRC. The increasing number of labor disputes that find their way to this Court and the
31
SEC. 9. Jurisdiction. - The Intermediate Appellate Court shall exercise: amended, the provisions of this Act, and of subparagraph (1) of the third paragraph and
subparagraph (4) of the fourth paragraph of Section 17 of the Judiciary Act of 1948.
(1) Original jurisdiction to issue writs of mandamus, prohibition, certiorari, habeas
corpus, and quo warranto, and auxiliary writs or processes, whether or not in aid of its The Court of Appeals shall have the power to try cases and conduct hearings, receive
appellate jurisdiction; evidence and perform any and all acts necessary to resolve factual issues raised in cases
falling within its original and appellate jurisdiction, including the power to grant and conduct
(2) Exclusive original jurisdiction over actions for annulment of judgments of Regional Trial new trials or further proceedings. Trials or hearings in the Court of Appeals must be continuous
Courts; and and must be completed within, three (3) months, unless extended by the Chief Justice.

(3) Exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders, or It will readily be observed that, aside from the change in the name of the lower appellate
awards of Regional Trial Courts and quasi-judicial agencies, instrumentalities, boards, or court,[16] the following amendments of the original provisions of Section 9 of B.P. No. 129 were
commissions, except those falling within the appellate jurisdiction of the Supreme Court in effected by R.A. No. 7902, viz.:
accordance with the Constitution, the provisions of this Act, and of subparagraph (1) of the
third paragraph and subparagraph (4) of the fourth paragraph of Section 17 of the Judiciary Act 1. The last paragraph which excluded its application to the Labor Code of the Philippines and
of 1948. the Central Board of Assessment Appeals was deleted and replaced by a new paragraph
granting the Court of Appeals limited powers to conduct trials and hearings in cases within its
The Intermediate Appellate Court shall have the power to try cases and conduct hearings, jurisdiction.
receive evidence and perform any and all acts necessary to resolve factual issues raised in
cases falling within its original and appellate jurisdiction, including the power to grant and 2. The reference to the Labor Code in that last paragraph was transposed to paragraph (3) of
conduct new trials or further proceedings. the section, such that the original exclusionary clause therein now provides except those falling
within the appellate jurisdiction of the Supreme Court in accordance with the Constitution, the
These provisions shall not apply to decisions and interlocutory orders issued under the Labor Labor Code of the Philippines under Presidential Decree No. 442, as amended, the provisions
Code of the Philippines and by the Central Board of Assessment Appeals. [15] of this Act, and of subparagraph (1) of the third paragraph and subparagraph (4) of the fourth
paragraph of Section 17 of the Judiciary Act of 1948. (Italics supplied)
Subsequently, and as it presently reads, this provision was amended by R.A. No. 7902
effective March 18, 1995, to wit: 3. Contrarily, however, specifically added to and included among the quasi-judicial agencies
over which the Court of Appeals shall have exclusive appellate jurisdiction are the Securities
and Exchange Commission, the Social Security Commission, the Employees Compensation
SEC. 9. Jurisdiction. - The Court of Appeals shall exercise:
Commission and the Civil Service Commission.
(1) Original jurisdiction to issue writs of mandamus, prohibition, certiorari, habeas corpus,
and quo warranto, and auxiliary writs or processes, whether or not in aid of its appellate This, then, brings us to a somewhat perplexing impass, both in point of purpose and
jurisdiction; terminology. As earlier explained, our mode of judicial review over decisions of the NLRC has
for some time now been understood to be by a petition for certiorari under Rule 65 of the Rules
of Court. This is, of course, a special original action limited to the resolution of jurisdictional
(2) Exclusive original jurisdiction over actions for annulment of judgments of Regional Trial issues, that is, lack or excess of jurisdiction and, in almost all cases that have been brought to
Courts; and us, grave abuse of discretion amounting to lack of jurisdiction.

(3) Exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders or It will, however, be noted that paragraph (3), Section 9 of B.P. No. 129 now grants
awards of Regional Trial Courts and quasi-judicial agencies, instrumentalities, boards or exclusive appellate jurisdiction to the Court of Appeals over all final adjudications of the
commissions, including the Securities and Exchange Commission, the Social Security Regional Trial Courts and the quasi-judicial agencies generally or specifically referred to
Commission, the Employees Compensation Commission and the Civil Service Commission, therein except, among others, those falling within the appellate jurisdiction of the Supreme
except those falling within the appellate jurisdiction of the Supreme Court in accordance with Court in accordance with x x x the Labor Code of the Philippines under Presidential Decree
the Constitution, the Labor Code of the Philippines under Presidential Decree No. 442, as No. 442, as amended, x x x. This would necessarily contradict what has been ruled and said all

32
along that appeal does not lie from decisions of the NLRC. [17] Yet, under such excepting clause Among the highest number of cases that are brought up to the Supreme Court
literally construed, the appeal from the NLRC cannot be brought to the Court of Appeals, but to are labor cases. Hence, Senate Bill No. 1495 seeks to eliminate the exceptions
this Court by necessary implication. enumerated in Section 9 and, additionally, extends the coverage of appellate review
of the Court of Appeals in the decision(s) of the Securities and Exchange
The same exceptive clause further confuses the situation by declaring that the Court of Commission, the Social Security Commission, and the Employees Compensation
Appeals has no appellate jurisdiction over decisions falling within the appellate jurisdiction of Commission to reduce the number of cases elevated to the Supreme
the Supreme Court in accordance with the Constitution, the provisions of B.P. No. 129, and Court. (Emphases and corrections ours)
those specified cases in Section 17 of the Judiciary Act of 1948. These cases can, of course,
be properly excluded from the exclusive appellate jurisdiction of the Court of xxx
Appeals. However, because of the aforementioned amendment by transposition, also
supposedly excluded are cases falling within the appellate jurisdiction of the Supreme Court in Senate Bill No. 1495 authored by our distinguished Colleague from Laguna provides
accordance with the Labor Code. This is illogical and impracticable, and Congress could not the ideal situation of drastically reducing the workload of the Supreme Court without
have intended that procedural gaffe, since there are no cases in the Labor Code the decisions, depriving the litigants of the privilege of review by an appellate tribunal.
resolutions, orders or awards wherein are within the appellate jurisdiction of the Supreme In closing, allow me to quote the observations of former Chief Justice Teehankee in
Court or of any other court for that matter. 1986 in the Annual Report of the Supreme Court:
A review of the legislative records on the antecedents of R.A. No. 7902 persuades us that x x x Amendatory legislation is suggested so as to relieve the Supreme
there may have been an oversight in the course of the deliberations on the said Act or an Court of the burden of reviewing these cases which present no important
imprecision in the terminology used therein. In fine, Congress did intend to provide for judicial issues involved beyond the particular fact and the parties involved, so that
review of the adjudications of the NLRC in labor cases by the Supreme Court, but there was an the Supreme Court may wholly devote its time to cases of public interest in
inaccuracy in the term used for the intended mode of review. This conclusion which we have the discharge of its mandated task as the guardian of the Constitution and
reluctantly but prudently arrived at has been drawn from the considerations extant in the the guarantor of the peoples basic rights and additional task expressly
records of Congress, more particularly on Senate Bill No. 1495 and the Reference Committee vested on it now to determine whether or not there has been a grave abuse
Report on S. No. 1495/H. No. 10452.[18] of discretion amounting to lack of jurisdiction on the part of any branch or
In sponsoring Senate Bill No. 1495, Senator Raul S. Roco delivered his sponsorship instrumentality of the Government.
speech[19] from which we reproduce the following excerpts: We used to have 500,000 cases pending all over the land, Mr. President. It has been
The Judiciary Reorganization Act, Mr. President, Batas Pambansa Blg. 129, cut down to 300,000 cases some five years ago. I understand we are now back to
reorganized the Court of Appeals and at the same time expanded its jurisdiction and 400,000 cases. Unless we distribute the work of the appellate courts, we shall
powers. Among others, its appellate jurisdiction was expanded to cover not only final continue to mount and add to the number of cases pending.
judgment of Regional Trial Courts, but also all final judgment(s), decisions, In view of the foregoing, Mr. President, and by virtue of all the reasons we have
resolutions, orders or awards of quasi-judicial agencies, instrumentalities, boards and submitted, the Committee on Justice and Human Rights requests the support and
commissions, except those falling within the appellate jurisdiction of the Supreme collegial approval of our Chamber.
Court in accordance with the Constitution, the provisions of BP Blg. 129 and of
subparagraph 1 of the third paragraph and subparagraph 4 of Section 17 of the xxx
Judiciary Act of 1948.
Surprisingly, however, in a subsequent session, the following Committee Amendment was
Mr. President, the purpose of the law is to ease the workload of the Supreme Court introduced by the said sponsor and the following proceedings transpired: [20]
by the transfer of some of its burden of review of factual issues to the Court of
Senator Roco. On page 2, line 5, after the line Supreme Court in accordance with the
Appeals. However, whatever benefits that can be derived from the expansion of the
Constitution, add the phrase THE LABOR CODE OF THE PHILIPPINES UNDER
appellate jurisdiction of the Court of Appeals was cut short by the last paragraph of
P.D. 442, AS AMENDED. So that it becomes clear, Mr. President, that issues arising
Section 9 of Batas Pambansa Blg. 129 which excludes from its coverage the
from the Labor Code will still be appealable to the Supreme Court.
decisions and interlocutory orders issued under the Labor Code of the
Philippines and by the Central Board of Assessment Appeals. The President. Is there any objection? (Silence) Hearing none, the amendment is approved.

33
Senator Roco. On the same page, we move that lines 25 to 30 be deleted. This was also Under such guarantee, the Supreme Court can then apply strictly the axiom that
discussed with our Colleagues in the House of Representatives and as we understand factual findings of the Court of Appeals are final and may not be reversed on appeal
it, as approved in the House, this was also deleted, Mr. President. to the Supreme Court. A perusal of the records will reveal appeals which are factual
in nature and may, therefore, be dismissed outright by minute resolutions.[24]
The President. Is there any objection? (Silence) Hearing none, the amendment is approved.
While we do not wish to intrude into the Congressional sphere on the matter of the
Senator Roco. There are no further Committee amendments, Mr. President. wisdom of a law, on this score we add the further observations that there is a growing number
Senator Romulo. Mr. President, I move that we close the period of Committee of labor cases being elevated to this Court which, not being a trier of fact, has at times been
amendments. constrained to remand the case to the NLRC for resolution of unclear or ambiguous factual
findings; that the Court of Appeals is procedurally equipped for that purpose, aside from the
The President. Is there any objection? (Silence) Hearing none, the amendment is increased number of its component divisions; and that there is undeniably an imperative need
approved. (Italics supplied) for expeditious action on labor cases as a major aspect of constitutional protection to labor.
xxx Therefore, all references in the amended Section 9 of B.P. No. 129 to supposed appeals
from the NLRC to the Supreme Court are interpreted and hereby declared to mean and refer to
Thereafter, since there were no individual amendments, Senate Bill No. 1495 was passed
petitions for certiorari under Rule 65. Consequently, all such petitions should henceforth be
on second reading and being a certified bill, its unanimous approval on third reading
initially filed in the Court of Appeals in strict observance of the doctrine on the hierarchy of
followed.[21]; Record of the Senate, Vol. V, No. 63, pp. 180-181.21 The Conference Committee
courts as the appropriate forum for the relief desired.
Report on Senate Bill No. 1495 and House Bill No. 10452, having theretofore been approved
by the House of Representatives, the same was likewise approved by the Senate on February Apropos to this directive that resort to the higher courts should be made in accordance
20, 1995,[22] inclusive of the dubious formulation on appeals to the Supreme Court earlier with their hierarchical order, this pronouncement in Santiago vs. Vasquez, et al.[25] should be
discussed. taken into account:
The Court is, therefore, of the considered opinion that ever since appeals from the NLRC One final observation. We discern in the proceedings in this case a propensity on the
to the Supreme Court were eliminated, the legislative intendment was that the special civil part of petitioner, and, for that matter, the same may be said of a number of litigants
action of certiorari was and still is the proper vehicle for judicial review of decisions of the who initiate recourses before us, to disregard the hierarchy of courts in our judicial
NLRC. The use of the word appeal in relation thereto and in the instances we have noted could system by seeking relief directly from this Court despite the fact that the same is
have been a lapsus plumae because appeals by certiorari and the original action for certiorari available in the lower courts in the exercise of their original or concurrent jurisdiction,
are both modes of judicial review addressed to the appellate courts. The important distinction or is even mandated by law to be sought therein. This practice must be stopped, not
between them, however, and with which the Court is particularly concerned here is that the only because of the imposition upon the precious time of this Court but also because
special civil action of certiorari is within the concurrent original jurisdiction of this Court and the of the inevitable and resultant delay, intended or otherwise, in the adjudication of the
Court of Appeals;[23] whereas to indulge in the assumption that appeals by certiorari to the case which often has to be remanded or referred to the lower court as the proper
Supreme Court are allowed would not subserve, but would subvert, the intention of Congress forum under the rules of procedure, or as better equipped to resolve the issues since
as expressed in the sponsorship speech on Senate Bill No. 1495. this Court is not a trier of facts. We, therefore, reiterate the judicial policy that this
Court will not entertain direct resort to it unless the redress desired cannot be
Incidentally, it was noted by the sponsor therein that some quarters were of the opinion
obtained in the appropriate courts or where exceptional and compelling
that recourse from the NLRC to the Court of Appeals as an initial step in the process of judicial
circumstances justify availment of a remedy within and calling for the exercise of our
review would be circuitous and would prolong the proceedings. On the contrary, as he
primary jurisdiction.
commendably and realistically emphasized, that procedure would be advantageous to the
aggrieved party on this reasoning: WHEREFORE, under the foregoing premises, the instant petition for certiorari is hereby
REMANDED, and all pertinent records thereof ordered to be FORWARDED, to the Court of
On the other hand, Mr. President, to allow these cases to be appealed to the Court of
Appeals for appropriate action and disposition consistent with the views and ruling herein set
Appeals would give litigants the advantage to have all the evidence on record be
forth, without pronouncement as to costs.
reexamined and reweighed after which the findings of facts and conclusions of said
bodies are correspondingly affirmed, modified or reversed. SO ORDERED.

34
G.R. No. 186450 : April 14, 2010 In the analogous case of BF Northwest Homeowners Association, Inc. vs. Intermediate
Appellate Court[,] the Supreme Court . . . categorically pronounced the RTC's jurisdiction over
NATIONAL WATER RESOURCES BOARD (NWRB), Petitioner, v. A. L. ANG NETWORK, appeals from the decisions of the NWRB consistent with Article 89 of P.D. No. 1067 and
INC.,Respondent. ratiocinated in this wise:

In issue is whether Regional Trial Courts have jurisdiction over appeals from decisions, The logical conclusion, therefore, is that jurisdiction over actions for annulment of NWRC
resolutions or orders of the National Water Resources Board (petitioner). decisions lies with the Regional Trial Courts, particularly, when we take note of the fact that the
appellate jurisdiction of the Regional Trial Court over NWRC decisions covers such broad and
all embracing grounds as grave abuse of discretion, questions of law, and questions of fact
A.L. Ang Network (respondent) filed on January 23, 2003 an application for a Certificate of
and law (Art. 89, P.D. No. 1067). This conclusion is also in keeping with the Judiciary
Public Convenience (CPC) with petitioner to operate and maintain a water service system in
Reorganization Act of 1980, which vests Regional Trial Courts with original jurisdiction to issue
Alijis, Bacolod City.
writs of certiorari, prohibition, mandamus, etc. (Sec. 21 [1], B.P. Blg. 129) relating to acts or
omissions of an inferior court (Sec. 4, Rule 65, Rules of Court).
Bacolod City Water District (BACIWA) opposed respondent's application on the ground that it
is the only government agency authorized to operate a water service system within the
Similarly, in Tanjay Water District vs. Pedro Gabaton, the Supreme Court conformably ruled,
city.1cräläwvirtualibräry
viz:
By Decision of August 20, 2003, petitioner granted respondent's CPC application. BACIWA
moved to have the decision reconsidered, contending that its right to due process was violated "Inasmuch as Civil Case No. 8144 involves the appropriation, utilization and control of water,
We hold that the jurisdiction to hear and decide the dispute in the first instance, pertains to the
when it was not allowed to present evidence in support of its opposition.2cЃa
Water Resources Council as provided in PD No. 1067 which is the special law on the
subject. The Court of First Instance (now Regional Trial Court) has only appellate jurisdiction
Petitioner reconsidered its Decision and allowed BACIWA to present evidence, 3cЃa drawing over the case."
respondent to file a petition for certiorari with the Regional Trial Court (RTC) of Bacolod City
against petitioner and BACIWA. Petitioner moved to dismiss the petition, arguing that the
Based on the foregoing jurisprudence, there is no doubt that [petitioner] NWRB is mistaken in
proper recourse of respondent was to the Court of Appeals, citing Rule 43 of the Rules of
its assertion. As no repeal is expressly made, Article 89 of P.D. No. 1067 is certainly meant to
Court.
be an exception to the jurisdiction of the Court of Appeals over appeals or petitions
for certiorari of the decisions of quasi-judicial bodies. This finds harmony with Paragraph 2,
The RTC, by Order of April 15, 2005, 4cЃa dismissed respondent's petition for lack of Section 4, Rule 65 of the Rules of Court wherein it is stated that, "If it involves the acts of a
jurisdiction, holding that it is the Court of Appeals which has "exclusive appellate jurisdiction quasi-judicial agency, unless otherwise provided by law or these rules, the petition shall be
over all final judgments, decisions, resolutions, order[s] or awards of . . . quasi-judicial filed in and cognizable only by the Court of Appeals." Evidently, not all petitions
agencies, instrumentalities, boards or commission[s] . . . except those within the appellate for certiorari under Rule 65 involving the decisions of quasi-judicial agencies must be filed with
jurisdiction of the Supreme Court . . . ." Thus the RTC explained: the Court of Appeals. The rule admits of some exceptions as plainly provided by the phrase
"unless otherwise provided by law or these rules" and Article 89 of P.D. No. 1067 is verily an
Art. 89 of P.D. 1067 having been long repealed by BP 129, as amended, which has effectively example of these exceptions. (italics and emphasis partly in the original; underscoring
and explicitly removed the Regional Trial Courts' appellate jurisdiction over the decisions, supplied)
resolutions, order[s] or awards of quasi-judicial agencies such as [petitioner] NWRB, and
vested with the Court of Appeals, very clearly now, this Court has no jurisdiction over this Petitioner's motion for reconsideration having been denied by the appellate court by Resolution
instant petition. of February 9, 2009,6cЃa petitioner filed the present petition for review, contending that:

Its motion for reconsideration having been denied, respondent filed a petition for certiorari at THE REGIONAL TRIAL COURT HAS NO CERTIORARI JURISDICTION OVER THE
the Court of Appeals, which, by Decision of January 25, 2008, 5 annulled and set aside the RTC [PETITIONER] SINCE SECTION 89, PD NO. 1067, REGARDING APPEALS, HAS BEEN
April 15, 2005, holding that it is the RTC which has jurisdiction over appeals from petitioner's SUPERSEDED AND REPEALED BY [BATAS PAMBANSA BILANG] 129 AND THE RULES
decisions. Thus the appellate court discoursed. OF COURT. FURTHERMORE, PD 1067 ITSELF DOES NOT CONTEMPLATE THAT THE
35
REGIONAL TRIAL COURT SHOULD HAVE CERTIORARI JURISDICTION OVER THE statutes, letters of instructions and general orders or parts thereof, inconsistent with the
[PETITIONER].7cЃa (underscoring supplied) provisions of this Act x x x. (emphasis and underscoring supplied)

Petitioner maintains that the RTC does not have jurisdiction over a petition for certiorari and The general repealing clause under Section 47 "predicates the intended repeal under the
prohibition to annul or modify its acts or omissions as a quasi-judicial agency. Citing Section 4 condition that a substantial conflict must be found in existing and prior acts."13cЃa
of Rule 65 of the Rules of Court, petitioner contends that there is no law or rule which requires
the filing of a petition for certiorari over its acts or omissions in any other court or tribunal other In enacting BP 129, the Batasang Pambansa was presumed to have knowledge of the
than the Court of Appeals.8cЃa provision of Article 89 of P.D. No. 1067 and to have intended to change it. 14cЃa The legislative
intent to repeal Article 89 is clear and manifest given the scope and purpose of BP 129, one of
Petitioner goes on to fault the appellate court in holding that Batas Pambansa Bilang 129 (BP which is to provide a homogeneous procedure for the review of adjudications of quasi-judicial
129) or the Judiciary Reorganization Act did not expressly repeal Article 89 of Presidential entities to the Court of Appeals.
Decree No. 1067 (PD 1067) otherwise known as the Water Code of the Philippines. 9cЃa
More importantly, what Article 89 of PD 1067 conferred to the RTC was the power of review on
Respondent, on the other hand, maintains the correctness of the assailed decision of the appeal the decisions of petitioner. It appears that the appellate court gave significant
appellate court. consideration to the ground of "grave abuse of discretion" to thus hold that the RTC
has certiorari jurisdiction over petitioner's decisions. A reading of said Article 89 shows,
The petition is impressed with merit. however, that it only made "grave abuse of discretion" as another ground to invoke in an
ordinary appeal to the RTC. Indeed, the provision was unique to the Water Code at the time of
its application in 1976.
Section 9 (1) of BP 129 granted the Court of Appeals (then known as the Intermediate
Appellate Court) original jurisdiction to issue writs of mandamus, prohibition, certiorari, habeas
corpus and quo warranto, and auxiliary writs or processes, whether or not in aid of its appellate The issuance of BP 129, specifically Section 9 (Jurisdiction of the Court of Appeals, then
jurisdiction.10cЃa known as Intermediate Appellate Court), and the subsequent formulation of the Rules, clarified
and delineated the appellate and certiorari jurisdictions of the Court of Appeals over
adjudications of quasi-judicial bodies. Grave abuse of discretion may be invoked before the
Since the appellate court has exclusive appellate jurisdiction over quasi-judicial agencies under
Rule 4311cЃa of the Rules of Court, petitions for writs of certiorari, prohibition or mandamus appellate court as a ground for an error of jurisdiction.
against the acts and omissions of quasi-judicial agencies, like petitioner, should be filed with it.
This is what Rule 65 of the Rules imposes for procedural uniformity. The only exception to this It bears noting that, in the present case, respondent assailed petitioner's order
instruction is when the law or the Rules itself directs otherwise, as cited in Section 4, Rule via certioraribefore the RTC, invoking grave abuse of discretion amounting to lack or excess of
65.12cЃa The appellate court's construction that Article 89 of PD 1067, which reads: jurisdiction as ground-basis thereof. In other words, it invoked such ground not for an error of
judgment.
ART. 89. The decisions of the [NWRB] on water rights controversies may be appealed to the
[RTC] of the province where the subject matter of the controversy is situated within fifteen (15) While Section 9 (3) of BP 12915cЃa and Section 1 of Rule 43 of the Rules of Court16cЃa does
days from the date the party appealing receives a copy of the decision, on any of the following not list petitioner as "among" the quasi-judicial agencies whose final judgments, orders,
grounds: (1) grave abuse of discretion; (2) question of law; and (3) questions of fact and law resolutions or awards are appealable to the appellate court, it is non sequitur to hold that the
(emphasis and underscoring supplied), is such an exception, is erroneous. Court of Appeals has no appellate jurisdiction over petitioner's judgments, orders, resolutions
or awards. It is settled that the list of quasi-judicial agencies specifically mentioned in Rule 43
Article 89 of PD 1067 had long been rendered inoperative by the passage of BP 129. Aside is not meant to be exclusive.17cЃa The employment of the word "among" clearly instructs so.
from delineating the jurisdictions of the Court of Appeals and the RTCs, Section 47 of BP 129
repealed or modified: BF Northwest Homeowners Association v. Intermediate Appellate Court,18cЃa a 1987 case
cited by the appellate court to support its ruling that RTCs have jurisdiction over judgments,
orders, resolutions or awards of petitioner, is no longer controlling in light of the definitive
x x x. [t]he provisions of Republic Act No. 296, otherwise known as the Judiciary Act of 1948,
as amended, of Republic Act No. 5179, as amended, of the Rules of Court, and of all other instruction of Rule 43 of the Revised Rules of Court.

36
Tanjay Water District v. Gabaton19cЃa is not in point either as the issue raised therein was
which between the RTC and the then National Water Resources Council had jurisdiction over
disputes in the appropriation, utilization and control of water.

In fine, certiorari and appellate jurisdiction over adjudications of petitioner properly belongs to
the Court of Appeals.

WHEREFORE, the challenged Decision and Resolution of the Court of Appeals


are REVERSED and SET ASIDE. The April 15, 2005 Order of the Regional Trial Court of
Bacolod City dismissing petitioner's petition for lack of jurisdiction is UPHELD.

No costs.

SO ORDERED

37
G.R. No. 155014 November 11, 2005 consequence, petitioner Crescent incurred additional expenses of US$8,572.61 for interest,
CRESCENT PETROLEUM LTD. vs. MV “LOK MAHESHWARI” THE SHIPPING tracking fees, and legal fees.
CORPORATION OF INDIA, and PORTSERV LIMITED and/or TRANSMAR SHIPPING, INC.
On May 2, 1996, while the Vessel was docked at the port of Cebu City, petitioner Crescent
This petition for review on certiorari under Rule 45 seeks the (a) reversal of the November 28, instituted before the RTC of Cebu City an action "for a sum of money with prayer for temporary
2001 Decision of the Court of Appeals in CA-G.R. No. CV-54920,1 which dismissed for "want of restraining order and writ of preliminary attachment" against respondents Vessel and SCI,
jurisdiction" the instant case, and the September 3, 2002 Resolution of the same appellate Portserv and/or Transmar. The case was raffled to Branch 10 and docketed as Civil Case No.
court,2 which denied petitioner’s motion for reconsideration, and (b) reinstatement of the July CEB-18679.
25, 1996 Decision3 of the Regional Trial Court (RTC) in Civil Case No. CEB-18679, which held
that respondents were solidarily liable to pay petitioner the sum prayed for in the complaint. On May 3, 1996, the trial court issued a writ of attachment against the Vessel with bond
at P2,710,000.00. Petitioner Crescent withdrew its prayer for a temporary restraining order and
The facts are as follows: Respondent M/V "Lok Maheshwari" (Vessel) is an oceangoing vessel posted the required bond.
of Indian registry that is owned by respondent Shipping Corporation of India (SCI), a
corporation organized and existing under the laws of India and principally owned by the On May 18, 1996, summonses were served to respondents Vessel and SCI, and Portserv
Government of India. It was time-chartered by respondent SCI to Halla Merchant Marine Co. and/or Transmar through the Master of the Vessel. On May 28, 1996, respondents Vessel and
Ltd. (Halla), a South Korean company. Halla, in turn, sub-chartered the Vessel through a time SCI, through Pioneer Insurance and Surety Corporation (Pioneer), filed an urgent ex-parte
charter to Transmar Shipping, Inc. (Transmar). Transmar further sub-chartered the Vessel to motion to approve Pioneer’s letter of undertaking, to consider it as counter-bond and to
Portserv Limited (Portserv). Both Transmar and Portserv are corporations organized and discharge the attachment. On May 29, 1996, the trial court granted the motion; thus, the letter
existing under the laws of Canada. of undertaking was approved as counter-bond to discharge the attachment.

On or about November 1, 1995, Portserv requested petitioner Crescent Petroleum, Ltd. For failing to file their respective answers and upon motion of petitioner Crescent, the trial court
(Crescent), a corporation organized and existing under the laws of Canada that is engaged in declared respondents Vessel and SCI, Portserv and/or Transmar in default. Petitioner
the business of selling petroleum and oil products for the use and operation of oceangoing Crescent was allowed to present its evidence ex-parte.
vessels, to deliver marine fuel oils (bunker fuels) to the Vessel. Petitioner Crescent granted
and confirmed the request through an advice via facsimile dated November 2, 1995. As
On July 25, 1996, the trial court rendered its decision in favor of petitioner Crescent, thus:
security for the payment of the bunker fuels and related services, petitioner Crescent received
two (2) checks in the amounts of US$100,000.00 and US$200,000.00. Thus, petitioner
Crescent contracted with its supplier, Marine Petrobulk Limited (Marine Petrobulk), another WHEREFORE, premises considered, judgment is hereby rendered in favor of plaintiff
Canadian corporation, for the physical delivery of the bunker fuels to the Vessel. [Crescent] and against the defendants [Vessel, SCI, Portserv and/or Transmar].

On or about November 4, 1995, Marine Petrobulk delivered the bunker fuels amounting to Consequently, the latter are hereby ordered to pay plaintiff jointly and solidarily, the following:
US$103,544 inclusive of barging and demurrage charges to the Vessel at the port of Pioneer
Grain, Vancouver, Canada. The Chief Engineer Officer of the Vessel duly acknowledged and (a) the sum of US$103,544.00, representing the outstanding obligation;
received the delivery receipt. Marine Petrobulk issued an invoice to petitioner Crescent for the
US$101,400.00 worth of the bunker fuels. Petitioner Crescent issued a check for the same (b) interest of US$10,978.50 as of July 3, 1996, plus additional interest at 18% per annum for
amount in favor of Marine Petrobulk, which check was duly encashed. the period thereafter, until the principal account is fully paid;

Having paid Marine Petrobulk, petitioner Crescent issued a revised invoice dated November (c) attorney’s fees of P300,000.00; and
21, 1995 to "Portserv Limited, and/or the Master, and/or Owners, and/or Operators, and/or
Charterers of M/V ‘Lok Maheshwari’" in the amount of US$103,544.00 with instruction to remit (d) P200,000.00 as litigation expenses.
the amount on or before December 1, 1995. The period lapsed and several demands were
made but no payment was received. Also, the checks issued to petitioner Crescent as security
SO ORDERED.
for the payment of the bunker fuels were dishonored for insufficiency of funds. As a
38
On August 19, 1996, respondents Vessel and SCI appealed to the Court of Appeals. They 7. Petitioner has legal capacity to sue before Philippine courts as it is suing upon an isolated
attached copies of the charter parties between respondent SCI and Halla, between Halla and business transaction;
Transmar, and between Transmar and Portserv. They pointed out that Portserv was a time
charterer and that there is a clause in the time charters between respondent SCI and Halla, 8. Respondents were duly served summons although service of summons upon respondents is
and between Halla and Transmar, which states that "the Charterers shall provide and pay for not a jurisdictional requirement, the action being a suit quasi in rem;
all the fuel except as otherwise agreed." They submitted a copy of Part II of the Bunker Fuel
Agreement between petitioner Crescent and Portserv containing a stipulation that New York
9. The trial court’s decision has factual and legal bases; and,
law governs the "construction, validity and performance" of the contract. They likewise
submitted certified copies of the Commercial Instruments and Maritime Lien Act of the United
States (U.S.), some U.S. cases, and some Canadian cases to support their defense. 10. The respondents should be held jointly and solidarily liable.

On November 28, 2001, the Court of Appeals issued its assailed Decision, which reversed that In a nutshell, this case is for the satisfaction of unpaid supplies furnished by a foreign supplier
of the trial court, viz: in a foreign port to a vessel of foreign registry that is owned, chartered and sub-chartered by
foreign entities.
WHEREFORE, premises considered, the Decision dated July 25, 1996, issued by the Regional
Trial Court of Cebu City, Branch 10, is hereby REVERSED and SET ASIDE, and a new one is Under Batas Pambansa Bilang 129, as amended by Republic Act No. 7691, RTCs exercise
entered DISMISSING the instant case for want of jurisdiction. exclusive original jurisdiction "(i)n all actions in admiralty and maritime where the demand or
claim exceeds two hundred thousand pesos (P200,000) or in Metro Manila, where such
demand or claim exceeds four hundred thousand pesos (P400,000)." Two (2) tests have been
The appellate court denied petitioner Crescent’s motion for reconsideration explaining that it
used to determine whether a case involving a contract comes within the admiralty and maritime
"dismissed the instant action primarily on the ground of forum non conveniens considering that
jurisdiction of a court - the locational test and the subject matter test. The English rule
the parties are foreign corporations which are not doing business in the Philippines."
follows the locational test wherein maritime and admiralty jurisdiction, with a few exceptions, is
exercised only on contracts made upon the sea and to be executed thereon. This is totally
Hence, this petition submitting the following issues for resolution, viz: rejected under the American rule where the criterion in determining whether a contract is
maritime depends on the nature and subject matter of the contract, having reference to
1. Philippine courts have jurisdiction over a foreign vessel found inside Philippine waters for the maritime service and transactions.4 In International Harvester Company of the Philippines
enforcement of a maritime lien against said vessel and/or its owners and operators; v. Aragon,5 we adopted the American rule and held that "(w)hether or not a contract is
maritime depends not on the place where the contract is made and is to be executed, making
2. The principle of forum non conveniens is inapplicable to the instant case; the locality the test, but on the subject matter of the contract, making the true criterion a
maritime service or a maritime transaction."
3. The trial court acquired jurisdiction over the subject matter of the instant case, as well as
over the res and over the persons of the parties; A contract for furnishing supplies like the one involved in this case is maritime and within the
jurisdiction of admiralty.6 It may be invoked before our courts through an action in rem or quasi
in rem or an action in personam. Thus: 7
4. The enforcement of a maritime lien on the subject vessel is expressly granted by law. The
Ship Mortgage Acts as well as the Code of Commerce provides for relief to petitioner for its
unpaid claim; xxx

5. The arbitration clause in the contract was not rigid or inflexible but expressly allowed "Articles 579 and 584 [of the Code of Commerce] provide a method of collecting or enforcing
petitioner to enforce its maritime lien in Philippine courts provided the vessel was in the not only the liens created under Section 580 but also for the collection of any kind of lien
Philippines; whatsoever."8 In the Philippines, we have a complete legislation, both substantive and
adjective, under which to bring an action in rem against a vessel for the purpose of enforcing
6. The law of the state of New York is inapplicable to the present controversy as the same has liens. The substantive law is found in Article 580 of the Code of Commerce. The procedural
not been properly pleaded and proved; law is to be found in Article 584 of the same Code. The result is, therefore, that in the

39
Philippines any vessel – even though it be a foreign vessel – found in any port of this Crescent as the provision refers only to a situation where the person furnishing the supplies is
Archipelago may be attached and sold under the substantive law which defines the right, and situated inside the territory of the Philippines and not where the necessaries were furnished in
the procedural law contained in the Code of Commerce by which this right is to be enforced. 9 x a foreign jurisdiction like Canada.12
x x. But where neither the law nor the contract between the parties creates any lien or charge
upon the vessel, the only way in which it can be seized before judgment is by pursuing the We find against petitioner Crescent.
remedy relating to attachment under Rule 59 [now Rule 57] of the Rules of Court.10
I.
But, is petitioner Crescent entitled to a maritime lien under our laws? Petitioner Crescent bases
its claim of a maritime lien on Sections 21, 22 and 23 of Presidential Decree No. 1521 (P.D.
P.D. No. 1521 or the Ship Mortgage Decree of 1978 was enacted "to accelerate the growth
No. 1521), also known as the Ship Mortgage Decree of 1978, viz:
and development of the shipping industry" and "to extend the benefits accorded to overseas
shipping under Presidential Decree No. 214 to domestic shipping."13 It is patterned closely from
Sec. 21. Maritime Lien for Necessaries; persons entitled to such lien. - Any person furnishing the U.S. Ship Mortgage Act of 1920 and the Liberian Maritime Law relating to preferred
repairs, supplies, towage, use of dry dock or maritime railway, or other necessaries, to any mortgages.14 Notably, Sections 21, 22 and 23 of P.D. No. 1521 or the Ship Mortgage Decree
vessel, whether foreign or domestic, upon the order of the owner of such vessel, or of a person of 1978 are identical to Subsections P, Q, and R, respectively, of the U.S. Ship Mortgage Act
authorized by the owner, shall have a maritime lien on the vessel, which may be enforced by of 1920, which is part of the Federal Maritime Lien Act. Hence, U.S. jurisprudence finds
suit in rem, and it shall be necessary to allege or prove that credit was given to the vessel. relevance to determining whether P.D. No. 1521 or the Ship Mortgage Decree of 1978 applies
in the present case.
Sec. 22. Persons Authorized to Procure Repairs, Supplies and Necessaries. - The following
persons shall be presumed to have authority from the owner to procure repairs, supplies, The various tests used in the U.S. to determine whether a maritime lien exists are the
towage, use of dry dock or marine railway, and other necessaries for the vessel: The managing following:
owner, ship’s husband, master or any person to whom the management of the vessel at the
port of supply is entrusted. No person tortuously or unlawfully in possession or charge of a One. "In a suit to establish and enforce a maritime lien for supplies furnished to a vessel in a
vessel shall have authority to bind the vessel. foreign port, whether such lien exists, or whether the court has or will exercise jurisdiction,
depends on the law of the country where the supplies were furnished, which must be
Sec. 23. Notice to Person Furnishing Repairs, Supplies and Necessaries. - The officers and pleaded and proved."15 This principle was laid down in the 1888 case of The
agents of a vessel specified in Section 22 of this Decree shall be taken to include such officers Scotia,16 reiterated in The Kaiser Wilhelm II17 (1916), in The Woudrichem18 (1921) and
and agents when appointed by a charterer, by an owner pro hac vice, or by an agreed in The City of Atlanta19 (1924).
purchaser in possession of the vessel; but nothing in this Decree shall be construed to confer a
lien when the furnisher knew, or by exercise of reasonable diligence could have ascertained, Two. The Lauritzen-Romero-Rhoditis trilogy of cases, which replaced such single-factor
that because of the terms of a charter party, agreement for sale of the vessel, or for any other
methodologies as the law of the place of supply. 20
reason, the person ordering the repairs, supplies, or other necessaries was without authority to
bind the vessel therefor.
In Lauritzen v. Larsen,21 a Danish seaman, while temporarily in New York, joined the crew of
a ship of Danish flag and registry that is owned by a Danish citizen. He signed the ship’s
Petitioner Crescent submits that these provisions apply to both domestic and foreign vessels,
articles providing that the rights of the crew members would be governed by Danish law and by
as well as domestic and foreign suppliers of necessaries. It contends that the use of the term
the employer’s contract with the Danish Seamen’s Union, of which he was a member. While in
"any person" in Section 21 implies that the law is not restricted to domestic suppliers but also
Havana and in the course of his employment, he was negligently injured. He sued the
includes all persons who supply provisions and necessaries to a vessel, whether foreign or
shipowner in a federal district court in New York for damages under the Jones Act. In holding
domestic. It points out further that the law does not indicate that the supplies or necessaries that Danish law and not the Jones Act was applicable, the Supreme Court adopted a multiple-
must be furnished in the Philippines in order to give petitioner the right to seek enforcement of contact test to determine, in the absence of a specific Congressional directive as to the
the lien with a Philippine court.11
statute’s reach, which jurisdiction’s law should be applied. The following factors were
considered: (1) place of the wrongful act; (2) law of the flag; (3) allegiance or domicile of
Respondents Vessel and SCI, on the other hand, maintain that Section 21 of the P.D. No. the injured; (4) allegiance of the defendant shipowner; (5) place of contract; (6)
1521 or the Ship Mortgage Decree of 1978 does not apply to a foreign supplier like petitioner inaccessibility of foreign forum; and (7) law of the forum.
40
Several years after Lauritzen, the U.S. Supreme Court in the case of Romero v. International admiralty and maritime law of the U.S. applied. The U.S. Court of Appeals recognized the
Terminal Operating Co.22 again considered a foreign seaman’s personal injury claim under modern approach to maritime conflict of law problems introduced in the Lauritzen case.
both the Jones Act and the general maritime law. The Court held that the factors first However, it observed that Lauritzen involved a torts claim under the Jones Act while the
announced in the case of Lauritzen were applicable not only to personal injury claims present claim involves an alleged maritime lien arising from unpaid supplies. It made a
arising under the Jones Act but to all matters arising under maritime law in general.23 disclaimer that its conclusion is limited to the unique circumstances surrounding a maritime lien
as well as the statutory directives found in the Maritime Lien Statute and that the initial choice
Hellenic Lines, Ltd. v. Rhoditis24 was also a suit under the Jones Act by a Greek seaman of law determination is significantly affected by the statutory policies surrounding a
injured aboard a ship of Greek registry while in American waters. The ship was operated by a maritime lien. It ruled that the facts in the case call for the application of the Restatement
Greek corporation which has its largest office in New York and another office in New Orleans (Second) of Conflicts of Law. The U.S. Court gave much significance to the congressional
and whose stock is more than 95% owned by a U.S. domiciliary who is also a Greek citizen. intent in enacting the Maritime Lien Statute to protect the interests of American supplier of
The ship was engaged in regularly scheduled runs between various ports of the U.S. and the goods, services or necessaries by making maritime liens available where traditional services
Middle East, Pakistan, and India, with its entire income coming from either originating or are routinely rendered. It concluded that the Maritime Lien Statute represents a relevant policy
terminating in the U.S. The contract of employment provided that Greek law and a Greek of the forum that serves the needs of the international legal system as well as the basic
collective bargaining agreement would apply between the employer and the seaman and that policies underlying maritime law. The court also gave equal importance to the predictability of
all claims arising out of the employment contract were to be adjudicated by a Greek court. The result and protection of justified expectations in a particular field of law. In the maritime realm, it
U.S. Supreme Court observed that of the seven factors listed in the Lauritzen test, four is expected that when necessaries are furnished to a vessel in an American port by an
were in favor of the shipowner and against jurisdiction. In arriving at the conclusion that American supplier, the American Lien Statute will apply to protect that supplier regardless of
the Jones Act applies, it ruled that the application of the Lauritzen test is not a mechanical one. the place where the contract was formed or the nationality of the vessel.
It stated thus: "[t]he significance of one or more factors must be considered in light of the
national interest served by the assertion of Jones Act jurisdiction. (footnote omitted) Moreover, The same principle was applied in the case of Swedish Telecom Radio v. M/V Discovery
the list of seven factors in Lauritzen was not intended to be exhaustive. x x x [T]he shipowner’s I29 where the American court refused to apply the Federal Maritime Lien Act to create a
base of operations is another factor of importance in determining whether the Jones Act is maritime lien for goods and services supplied by foreign companies in foreign ports. In this
applicable; and there well may be others." case, a Swedish company supplied radio equipment in a Spanish port to refurbish a
Panamanian vessel damaged by fire. Some of the contract negotiations occurred in Spain and
The principles enunciated in these maritime tort cases have been extended to cases involving the agreement for supplies between the parties indicated Swedish company’s willingness to
unpaid supplies and necessaries such as the submit to Swedish law. The ship was later sold under a contract of purchase providing for the
cases of Forsythe International U.K., Ltd. v. M/V Ruth Venture,25 and Comoco Marine application of New York law and was arrested in the U.S. The U.S. Court of Appeals also held
Services v. M/V El Centroamericano.26 that while the contacts-based framework set forth in Lauritzen was useful in the analysis of all
maritime choice of law situations, the factors were geared towards a seaman’s injury claim. As
Three. The factors provided in Restatement (Second) of Conflicts of Law have also been in Gulf Trading, the lien arose by operation of law because the ship’s owner was not a party to
applied, especially in resolving cases brought under the Federal Maritime Lien Act. Their the contract under which the goods were supplied. As a result, the court found it more
appropriate to consider the factors contained in Section 6 of the Restatement (Second) of
application suggests that in the absence of an effective choice of law by the parties, the forum
Conflicts of Law. The U.S. Court held that the primary concern of the Federal Maritime Lien Act
contacts to be considered include: (a) the place of contracting; (b) the place of negotiation of
is the protection of American suppliers of goods and services.
the contract; (c) the place of performance; (d) the location of the subject matter of the contract;
and (e) the domicile, residence, nationality, place of incorporation and place of business of the
parties.27 The same factors were applied in the case of Ocean Ship Supply, Ltd. v. M/V Leah.30

In Gulf Trading and Transportation Co. v. The Vessel Hoegh Shield,28 an admiralty II.
action in rem was brought by an American supplier against a vessel of Norwegian flag owned
by a Norwegian Company and chartered by a London time charterer for unpaid fuel oil and Finding guidance from the foregoing decisions, the Court cannot sustain petitioner Crescent’s
marine diesel oil delivered while the vessel was in U.S. territory. The contract was executed in insistence on the application of P.D. No. 1521 or the Ship Mortgage Decree of 1978 and hold
London. It was held that because the bunker fuel was delivered to a foreign flag vessel within that a maritime lien exists.
the jurisdiction of the U.S., and because the invoice specified payment in the U.S., the

41
First. Out of the seven basic factors listed in the case of Lauritzen, Philippine law only falls It is worthy to note that petitioner Crescent never alleged and proved Canadian law as basis for
under one – the law of the forum. All other elements are foreign – Canada is the place of the the existence of a maritime lien. To the end, it insisted on its theory that Philippine law applies.
wrongful act, of the allegiance or domicile of the injured and the place of contract; India is the Petitioner contends that even if foreign law applies, since the same was not properly pleaded
law of the flag and the allegiance of the defendant shipowner. Balancing these basic interests, and proved, such foreign law must be presumed to be the same as Philippine law pursuant to
it is inconceivable that the Philippine court has any interest in the case that outweighs the the doctrine of processual presumption.
interests of Canada or India for that matter.
Thus, we are left with two choices: (1) dismiss the case for petitioner’s failure to establish a
Second. P.D. No. 1521 or the Ship Mortgage Decree of 1978 is inapplicable following the cause of action31 or (2) presume that Canadian law is the same as Philippine law. In either
factors under Restatement (Second) of Conflict of Laws. Like the Federal Maritime Lien Act of case, the case has to be dismissed.
the U.S., P.D. No. 1521 or the Ship Mortgage Decree of 1978 was enacted primarily to protect
Filipino suppliers and was not intended to create a lien from a contract for supplies between It is well-settled that a party whose cause of action or defense depends upon a foreign law has
foreign entities delivered in a foreign port. the burden of proving the foreign law. Such foreign law is treated as a question of fact to be
properly pleaded and proved.32Petitioner Crescent’s insistence on enforcing a maritime lien
Third. Applying P.D. No. 1521 or the Ship Mortgage Decree of 1978 and rule that a maritime before our courts depended on the existence of a maritime lien under the proper law. By
lien exists would not promote the public policy behind the enactment of the law to develop the erroneously claiming a maritime lien under Philippine law instead of proving that a maritime
domestic shipping industry. Opening up our courts to foreign suppliers by granting them a lien exists under Canadian law, petitioner Crescent failed to establish a cause of action. 33
maritime lien under our laws even if they are not entitled to a maritime lien under their laws will
encourage forum shopping. Even if we apply the doctrine of processual presumption, the result will still be the same. Under
P.D. No. 1521 or the Ship Mortgage Decree of 1978, the following are the requisites for
Finally. The submission of petitioner is not in keeping with the reasonable expectation of the maritime liens on necessaries to exist: (1) the "necessaries" must have been furnished to and
parties to the contract. Indeed, when the parties entered into a contract for supplies in Canada, for the benefit of the vessel; (2) the "necessaries" must have been necessary for the
they could not have intended the laws of a remote country like the Philippines to determine the continuation of the voyage of the vessel; (3) the credit must have been extended to the vessel;
creation of a lien by the mere accident of the Vessel’s being in Philippine territory. (4) there must be necessity for the extension of the credit; and (5) the necessaries must be
ordered by persons authorized to contract on behalf of the vessel.34 These do not avail in the
III. instant case.

But under which law should petitioner Crescent prove the existence of its maritime lien? First. It was not established that benefit was extended to the vessel. While this is presumed
when the master of the ship is the one who placed the order, it is not disputed that in this case
it was the sub-charterer Portserv which placed the orders to petitioner Crescent. 35 Hence, the
In light of the interests of the various foreign elements involved, it is clear that Canada has the
presumption does not arise and it is incumbent upon petitioner Crescent to prove that benefit
most significant interest in this dispute. The injured party is a Canadian corporation, the sub-
was extended to the vessel. Petitioner did not.
charterer which placed the orders for the supplies is also Canadian, the entity which physically
delivered the bunker fuels is in Canada, the place of contracting and negotiation is in Canada,
and the supplies were delivered in Canada. Second. Petitioner Crescent did not show any proof that the marine products were necessary
for the continuation of the vessel.
The arbitration clause contained in the Bunker Fuel Agreement which states that New York law
governs the "construction, validity and performance" of the contract is only a factor that may be Third. It was not established that credit was extended to the vessel. It is presumed that "in the
considered in the choice-of-law analysis but is not conclusive. As in the cases of Gulf absence of fraud or collusion, where advances are made to a captain in a foreign port, upon
Trading and Swedish Telecom, the lien that is the subject matter of this case arose by his request, to pay for necessary repairs or supplies to enable his vessel to prosecute her
operation of law and not by contract because the shipowner was not a party to the contract voyage, or to pay harbor dues, or for pilotage, towage and like services rendered to the vessel,
under which the goods were supplied. that they are made upon the credit of the vessel as well as upon that of her owners."36 In this
case, it was the sub-charterer Portserv which requested for the delivery of the bunker fuels.
The issuance of two checks amounting to US$300,000 in favor of petitioner Crescent prior to

42
the delivery of the bunkers as security for the payment of the obligation weakens petitioner
Crescent’s contention that credit was extended to the Vessel.

We also note that when copies of the charter parties were submitted by respondents in the
Court of Appeals, the time charters between respondent SCI and Halla and between Halla and
Transmar were shown to contain a clause which states that "the Charterers shall provide and
pay for all the fuel except as otherwise agreed." This militates against petitioner Crescent’s
position that Portserv is authorized by the shipowner to contract for supplies upon the credit of
the vessel.

Fourth. There was no proof of necessity of credit. A necessity of credit will be presumed where
it appears that the repairs and supplies were necessary for the ship and that they were ordered
by the master. This presumption does not arise in this case since the fuels were not ordered by
the master and there was no proof of necessity for the supplies.

Finally. The necessaries were not ordered by persons authorized to contract in behalf of the
vessel as provided under Section 22 of P.D. No. 1521 or the Ship Mortgage Decree of 1978 -
the managing owner, the ship’s husband, master or any person with whom the management of
the vessel at the port of supply is entrusted. Clearly, Portserv, a sub-charterer under a time
charter, is not someone to whom the management of the vessel has been entrusted. A time
charter is a contract for the use of a vessel for a specified period of time or for the duration of
one or more specified voyages wherein the owner of the time-chartered vessel retains
possession and control through the master and crew who remain his employees. 37 Not
enjoying the presumption of authority, petitioner Crescent should have proved that Portserv
was authorized by the shipowner to contract for supplies. Petitioner failed.

A discussion on the principle of forum non conveniens is unnecessary.

IN VIEW WHEREOF, the Decision of the Court of Appeals in CA-G.R. No. CV 54920, dated
November 28, 2001, and its subsequent Resolution of September 3, 2002 are AFFIRMED. The
instant petition for review on certiorari is DENIED for lack of merit. Cost against petitioner. SO
ORDERED.

43
G.R. No. 137793 September 29, 1999 On September 3, 1997, the trial court, without resolving petitioner's motion to set aside default
NILO RAYMUNDO vs. CA and JUAN MACROS ARELLANO order and motion to set aside plaintiffs ex-parte evidence, rendered a decision, 12 the decretal
portion of which reads:
The petition for review on certiorari before the Court assails the resolution 1 of the Court of
Appeals dismissing the petition for certiorari filed by petitioner Nilo H. Raymundo to nullify the WHEREFORE, judgment is hereby rendered in favor of plaintiff Juan Marco Arellano,
decision of the Regional Trial Court, Branch 67, Pasig City. 2 Jr. and against defendant Nilo Raymundo who is hereby ordered to pay the following:

The facts are as follows: 1. to pay plaintiff the amount of P3,625,000.00 representing the principal obligation and to pay
the legal interest from October 1, 1996 until fully paid;
On October 22, 1996, private respondent Juan Marcos Arellano, Jr. filed with the Regional 2. to pay P15,000.00 by way of moral damages;
Trial Court, Pasig City, a complaint 3 against petitioner for collection of a sum of money. 3. to pay P10,000.00 by way of exemplary damages;
4. to pay 25% of the amount recovered by way of attorney's fees; and
On November 12, 1996, petitioner filed with the trial court his answer with counterclaim to the 5. to pay the cost of suit.
complaint. 4 SO ORDERED.
Pasig City, September 3, 1997.
(s/t) APOLINARIO B. SANTOS
On January 7, 1997, at 9:00 a.m., the trial court scheduled a pre-trial conference. It was Judge
nonetheless postponed in view of petitioner's motion for leave to file an amended answer.
13
On October 15, 1997, petitioner filed with the trial court a motion for reconsideration of the
On January 9, 1997, petitioner filed with the trial court his amended answer with decision, to which private respondent filed an opposition. 14
counterclaim 5 together with a manifestation. 6 In time, private respondent filed an
opposition 7 to the admission of the amended answer, to which petitioner filed a reply. 8
On November 14, 1997, petitioner filed with the trial court an "ad cautelam" omnibus petition
for relief from judgment, order or other
On February 24, 1997, the trial court issued an order 9 striking out petitioner's manifestation proceedings. 15
and amended answer with counterclaim for failure to comply with the provisions of Section 3,
Rule 10 of the Rules of Court.
On May 12, 1998, the trial court issued an order 16 denying petitioner's motion for
reconsideration and "ad cautelam" omnibus petition.
Meanwhile, the trial court scheduled the pre-trial conference on March 5, 1997, at 8:30 a.m.,
conditioned on whether or not petitioner's amended answer with counterclaim would be
On May 28, 1998, petitioner filed with the trial court a notice of appeal 17 to the Court of
admitted.
Appeals 18 from the trial court's decision dated September 3, 1997, and its order dated May 12,
1998, which the trial court approved in an order dated June 9, 1998. 19
As his motion to admit amended answer was not yet resolved, petitioner did not attend the pre-
trial conference scheduled on March 5, 1997. Later that day, petitioner learned that the trial
On July 16, 1998, petitioner filed with the Court of Appeals a special civil action
court declared him in default for non-appearance at the pre-trial conference and allowed
for certiorari challenging the validity of the trial court's decision and other proceedings as
respondent to present his evidence ex-parte the following day, March 6, 1997.1âwphi1.nêt
having been rendered with grave abuse of discretion. 20
On March 6, 1997, petitioner filed with the trial court an urgent motion to set aside default
order. 10 Despite the motion, the trial court proceeded to receive private respondent's On February 19, 1999, the Court of Appeals promulgated its decision dismissing the petition
outright ruling that certiorari lies only when there is no appeal or any other plain, speedy or
evidence ex-parte.
adequate remedy available to petitioner. Also, certiorari will not issue to cure errors in
proceedings or erroneous conclusions of law or fact. The Court of Appeals added that where
On March 7, 1997, petitioner filed with the trial court a motion to set aside respondent's ex- appeal is the proper remedy, certiorari would not lie. The failure of the trial court to resolve
parte evidence. 11 petitioner's motion to set aside default order and motion to set aside private respondent's ex-

44
parteevidence before rendering judgment is "purely errors/oversight in the proceedings, not Worse, the trial court acted despotically in allowing respondent to present evidence ex-
necessarily an error of jurisdiction." 21 parte even if petitioner could not be lawfully declared in default for non-appearance due to the
trial court's own failure to rule on the admission of his amended answer because the original
Hence, this petition. 22 answer was on record. More, in deciding the case without resolving petitioner's motion to set
aside default and motion to set aside ex-parte evidence, the trial court exercised its discretion
capriciously, arbitrarily and whimsically. 27 Thus, the trial court gravely abused its discretion
On June 14, 1999, the Court required respondents to comment on the petition, not to file a
motion to dismiss, within ten (10) days from notice. 23 amounting to lack or excess of jurisdiction.

24 We have time and again allowed recourse to the extraordinary remedy of certiorari where an
On July 20, 1999, private respondent filed his comment.
appeal is not adequate, or equally beneficial, speedy and sufficient. 28
We give due course to the petition, which we find meritorious.
WHEREFORE, the petition is hereby GRANTED. The Resolution of the Court of Appeals in
CA-G.R. SP No. 48017, promulgated on February 19, 1999 is REVERSED and SET ASIDE.
The basic issue is whether the Court of Appeals erred in denying the issuance of a writ
of certiorari because of the availability of appeal. It ruled that the right to appeal is antithetical
to a special civil action of certiorari. Petitioner submits that certiorari is proper even where In lieu thereof, judgment is hereby rendered setting aside the trial court's decision dated
September 3, 1997 and order dated May 12, 1998, in Civil Case No. 65956. This renders
appeal is available where the orders complained of were issued in excess or without
petitioner's appeal in CA-G.R. CV No. 60459 of the Court of Appeals functus officio.
jurisdiction and the appeal is not adequate or equally beneficial, speedy and sufficient.

Let the case be remanded to the trial court for further proceedings. No costs.1âwphi1.nêt SO
We agree.
ORDERED.
An ordinary appeal is the proper remedy in questioning a judgment by default; appeal is also
the proper remedy from an order denying a petition for relief of judgment. 25 Hence, in the
normal course of events, the Court of Appeals correctly denied the petition for certiorari before
it, assailing the trial court's decision by default and denial of the petition for relief, in view of the
availability of appeal therefrom. However, in the exceptional circumstances presented in this
case, appeal seems to be inadequate; consequently, even if petitioner interposed an
appeal, certiorari lies to correct such a despotic exercise of discretion. 26

The failure of the trial court to act on the twin motions of petitioner to set aside the order of
default and to set aside the evidence ex-parte, cannot be lightly dismissed as a mere error or
oversight. It seriously affected the discretion of the trial court, for such omission amounted to
grave abuse of discretion depriving petitioner of the opportunity to be heard on the two crucial
motions which, if granted, would have allowed petitioner to regain his standing in court and to
present his evidence.

Purportedly, the trial court declared petitioner as in default when he failed to attend the
scheduled March 5, 1997 pre-trial conference. Petitioner, however, explained that he did not
attend because he was awaiting resolution of his motion to admit amended answer filed as
early as January 9, 1997. Thus, petitioner need not attend the March 5, 1997 pre-trial
conference because the resolution of his motion to admit amended answer takes precedence
over the pre-trial conference. The trial court gravely abused its discretion in declaring petitioner
as in default when it was itself remiss in not resolving petitioner's pending motions.

45
G.R. No. 119347 March 17, 1999 pecuniary estimation falling within the jurisdiction of the Regional Trial Court. Private respondents
EULALIA RUSSELL, PUPERTO TAUTHO, FRANCISCO TAUTHO, SUSANA T. REALES, did not oppose the motion for reconsideration.
APITACIO TAUTHO, DANILO TAUTHO, JUDITHA PROS, GREGORIO TAUTHO, DEODITA T.
JUDILLA, AGRIPINO TAUTHO, FELIX TAUTHO, WILLIAM TAUTHO, AND MARILYN PERALES On February 13, 1995, the respondent judge issued another Order denying the motion for
vs. HONORABLE AUGUSTINE A. VESTlL, ADRIANO TAGALOG, MARCELO TAUTHO, reconsideration. 10
JUANITA MENDOZA, DOMINGO BANTILAN, RAUL BATALUNA AND ARTEMIO CABATINGAN
Hence, this petition wherein the sole issue raised is whether or not the Regional Trial Court has
Before us is a Petition for Certiorari to set aside the Order dated January 12, 1995 issued by jurisdiction to entertain Civil Case No. MAN-2275.
respondent Judge Augustine A. Vestil of the Regional Trial Court of Mandaue City, Branch 56,
dismissing the complaint filed by petitioners on ground of lack of jurisdiction, as well as his Order
We find merit in the petition.
dated February 13, 1995 denying petitioners' Motion for Reconsideration of the order of dismissal.

The facts of the case are as follows: Petitioners maintain the view that the complaint filed before the Regional Trial Court is for the
annulment of a document denominated as "DECLARATION OF HEIRS AND DEED OF
CONFIRMATION OF PREVIOUS ORAL PARTITION," which is clearly one incapable of pecuniary
On September 28, 1994, petitioners filed a complaint against private respondents, denominated estimation, thus, cognizable by the Regional Trial Court.
"DECLARATION OF NULLITY AND PARTITION," with the Regional Trial Court of Mandaue City,
Branch 56, docketed as Civil Case No. MAN-2275. The complaint, in substance, alleged that
petitioners are co-owners of that parcel of land, Lot 6149 situated in Liloan, Cebu and containing an Private respondents, on the other hand, insists that the action is one for re-partition and since the
assessed value of the property as stated in the complaint is P5,000.00, then, the case falls within
area of 56,977.40 square meters, more or less. The land was previously owned by the spouses
the jurisdiction of the Municipal Circuit Trial Court of Liloan, Compostela, Cebu.
Casimero Tautho and Cesaria Tautho. Upon the death of said spouses, the property was inherited
by their legal heirs, herein petitioners and private respondents. Since then, the lot had remained
undivided until petitioners discovered a public document denominated "DECLARATION OF HEIRS For better appreciation of the facts, the pertinent portions of the complaint are reproduced
AND DEED OF CONFIRMATION OF A PREVIOUS ORAL AGREEMENT OF PARTITION," hereunder:
executed on June 6, 1990. By virtue of this deed, private respondents divided the property among
themselves to the exclusion of petitioners who are also entitled to the said lot as heirs of the late 3. That the plaintiffs and the defendants are the legal heirs of spouses Casimero Tautho
spouses Casimero Tautho and Cesaria Tautho. Petitioners claimed that the document was false and Cesaria N. Tautho who died long time ago;
and perjurious as the private respondents were not the only heirs and that no oral partition of the
property whatsoever had been made between the heirs. The complaint prayed that the document 4. That in life the spouses became the owners in fee simple of a certain parcel of land,
be declared null and void and an order be issued to partition the land among all the heirs. 1 which is more particularly described as follows:

On November 24, 1994, private respondents filed a Motion to Dismiss 2 the complaint on the ground A parcel of land containing 56,97740 square meters, more or less, located
of lack of jurisdiction over the nature of the case as the total assessed value of the subject land is at Cotcot, Liloan, Cebu.
P5,000.00 which under section 33 (3) 3 of Batas Pambansa Blg. 129, as amended by R.A. No.
7691, 4 falls within the exclusive jurisdiction of the Municipal Circuit Trial Curt of Liloan,
Compostela. 5 designated as Lot 6149 per Technical Description and Certification issued by the Office of
the Land Management copy of which are hereto attached as Annexes "A" and "A-1" and
are made part hereof: total assessed value is P5,000.00;
Petitioners filed an Opposition to the Motion to Dismiss 6 saying that the Regional Trial Court has
jurisdiction over the case since the action is one which is incapable of pecuniary estimation within
the contemplation of Section 19(1) of B.P. 129, as amended. 7 5. That the passed to the children of the spouses (who are all deceased except for
defendant Marcelo Tautho), namely: Zacarias, Epifania, Vicenta, Felecisimo, Maria,
Lorencia and Marcelo, and which in turn passed to the plaintiffs and defendants upon their
On January 12, 1995, the respondent judge issued an Order granting the Motion to Dismiss. 8 A death they being their descendants and legal heirs;
Motion for Reconsideration of said order was filed by petitioners on January 30, 1995 alleging that
the same is contrary to law because their action is not one for recovery of title to or possession of
the land but an action to annul a document or declare it null and void, 9 hence, one incapable of 6. That the subject parcel of land has for year been undivided by and among the legal heirs
of said previous owners;

46
7. That, very recently, plaintiffs discovered a public document, which is a declaration of the claim is considered capable of pecuniary estimation, and whether jurisdiction is in the
heirs and deed of confirmation of a previous oral agreement of partition, affecting the land municipal courts or in instance would depend on the amount of the claim. However, where
executed by and among the defendants whereby defendants divided the property among the basic issue is something other than the right to recover a sum of money, where the
themselves to the exclusion of plaintiffs who are entitled thereto; attached hereto as Annex money claim is purely incidental to, or a consequence of, the principal relief sought, this
"B" and is made part hereof is xerox copy of said document; Court has considered such where the subject of the litigation may not be estimated in terms
of money, and are cognizable exclusively by courts of first instance (now Regional Trial
8. That the instrument (Annex "B") is false and perjurious and is a complete nullity because Courts). 13
the defendants are not the only heirs of Casimero Tautho; plaintiffs are also heirs and
descendants of said deceased; moreover, there has been no oral partition of the property; Examples of actions incapable of pecuniary estimation are those for specific performance, support,
or foreclosure of mortgage or annulment of judgment; 14 also actions questioning the validity of a
9. That pursuant to said document (Annex "B"), defendants had procured tax declarations mortgage, 15 annulling a deed of sale or conveyance and to recover the price paid 16 and for
of the land for their supposed "shares" to the great damage and prejudice of plaintiffs; rescession, which is a counterpart of specific performance. 17

10. That the property in controversy should be divided into seven (7) equal parts since While actions under Sec. 33(3) of B.P. 129 are also incapable of pecuniary estimation, the law
Casimero Tautho and Cesaria N. Tautho had seven children; specifically mandates that they are cognizable by the MTC, METC, or MCTC where the assessed
value of the real property involved does exceed P20,000.00 in Metro Manila, or P50,000.00, if
located elsewhere. If the value exceeds P20,000.00 or P50,000.00 as the case may be, it is the
11. That the parties had failed to settle the controversy amicably at the barangay level; Regional Trial Courts which have jurisdiction under Sec. 19(2). 18 However, the subject matter of the
attached hereto as Annex "C" is Certification to file Action;
complaint in this case is annulment of a document denominated as "DECLARATION OF HEIRS
AND DEED OF CONFIRMATION OF PREVIOUS ORAL PARTITION."
12. That by reason of the foregoing unjust and illegal act of defendants, plaintiffs were
forced to bring instant action and contract the services of the undersigned counsel with
The main purpose of petitioners in filing the complaint is to declare null and void the document in
whom they bind themselves to pay P30,000.00 as attorney's fees.
which private respondents declared themselves as the only heirs of the late spouses Casimero
Tautho and Cesaria Tautho and divided his property among themselves to the exclusion of
WHEREFORE, it is most respectfully prayed of this Honorable Court to declare null and petitioners who also claim to be legal heirs and entitled to the property. While the complaint also
void the document (Annex "B") of declaration of heirs and confirmation and to order the prays for the partition of the property, this is just incidental to the main action, which is the
partition of the land into seven (7) equal parts; each part shall respectively go to the seven declaration of nullity of the document above-described. It is axiomatic that jurisdiction over the
(7) children of Casimero Tautho and considering six (6) of them died already the same shall subject matter of a case is conferred by law and is determined by the allegations in the complaint
go to their children or descendants, and to order the defendants to pay plaintiffs attorney's and the character of the relief sought, irrespective of whether the plaintiff is entitled to all or some of
fees in the amount of P30,000.00. the claims asserted therein. 19

Plaintiffs further pray for such other reliefs and remedies just and equitable under the WHEREFORE, premises considered, the petition is hereby GRANTED. The Order dismissing Civil
premises. 11 Case No. MAN-2275, as well as the Order denying the motion for reconsideration of said Order, is
SET ASIDE.
We agree with petitioners.
The Regional Trial Court, Branch 56, Mandaue City is ORDERED to proceed with dispatch in
The complaint filed before the Regional Trial Court is doubtless one incapable of pecuniary resolving Civil Case No. MAN-2275. No costs.SO ORDERED.
estimation and therefore within the jurisdiction of said court.

In Singsong vs. Isabela Sawmill, 12 we had the occasion to rule that:

[I]n determining whether an action is one the subject matter of which is not capable of
pecuniary estimation this Court has adopted the criterion of first ascertaining the nature of
the principal action or remedy sought. If it is primarily for the recovery of a sum of money,

47
G.R. No. 146886 April 30, 2003 MTC, in its Order dated May 3, 1999, denied [respondent's] [M]otion for
DEBORAH BARDILLON vs. BRGY. MASILI OF CALAMBA LAGUNA [R]econsideration thereof.

An expropriation suit is incapable of pecuniary estimation. Accordingly, it falls within the "The second [C]omplaint for eminent domain, docketed as Civil Case No. 2845-99-C
jurisdiction of regional trial courts, regardless of the value of the subject property. and entitled 'Brgy. Masili, Calamba, Laguna v. Devorah E. Bardillon' was filed before
Branch 37 of the Regional Trial Court of Calamba, Laguna ('RTC') on October 18,
The Case 1999. This [C]omplaint also sought the expropriation of the said Lot 4381-D for the
erection of a multi-purpose hall of Barangay Masili, but petitioner, by way of a Motion
to Dismiss, opposed this [C]omplaint by alleging in the main that it violated Section
Before us is a Petition for Review1 under Rule 45 of the Rules of Court, seeking to set aside
19(f) of Rule 16 in that [respondent's] cause of action is barred by prior judgment,
the January 10, 2001 Decision and the February 5, 2001 Resolution of the Court of
pursuant to the doctrine of res judicata.
Appeals2 (CA) in CA-GR SP No. 61088. The dispositive part of the Decision reads:

"On January 21, 2000, [the] Judge issued an order denying petitioner's Motion to
"WHEREFORE, premises considered, the present [P]etition for [C]ertiorari is hereby
Dismiss, holding that the MTC which ordered the dismissal of Civil Case No. 3648 has
DENIED DUE COURSE and accordingly DISMISSED, for lack of merit."3
no jurisdiction over the said expropriation proceeding.
The assailed Resolution4 denied petitioner's Motion for Reconsideration.
"With the subsequent approval of Municipal Ordinance No. 2000-261 on July 10, 2000,
and the submission thereof in compliance with [the] Judge's Order dated June 9, 2000
The Facts requiring herein respondent to produce the authority for the expropriation through the
Municipal Council of Calamba, Laguna, the assailed Order dated August 4, 2000 was
The factual antecedents are summarized by the CA as follows: issued in favor of Barangay Masili x x x and, on August 16, 2000, the corresponding
order for the issuance of the [W]rit of [P]ossession over Lot 4381-D."5
"At the root of this present [P]etition is the controversy surrounding the two (2)
[C]omplaints for eminent domain which were filed by herein respondent for the purpose Ruling of the Court of Appeals
of expropriating a ONE HUNDRED FORTY FOUR (144) square meter-parcel of land,
otherwise known as Lot 4381-D situated in Barangay Masili, Calamba, Laguna and In dismissing the Petition, the CA held that the Regional Trial Court (RTC) of Calamba, Laguna
owned by herein petitioner under Transfer Certificate of Title No. 383605 of the (Branch 37)6 did not commit grave abuse of discretion in issuing the assailed Orders. It ruled
Registry of Deeds of Calamba, Laguna. Petitioner acquired from Makiling Consolidated that the second Complaint for eminent domain (Civil Case No. 2845-99-C) was not barred
Credit Corporation the said lot pursuant to a Deed of Absolute Sale which was by res judicata. The reason is that the Municipal Trial Court (MTC), which dismissed the first
executed by and between the former and the latter on October 7, 1996. Complaint for eminent domain (Civil Case No. 3648), had no jurisdiction over the action.

"The first [C]omplaint for eminent domain, docketed as Civil Case No. 3648 and Hence, this Petition.7
entitled 'Brgy. Masili, Calamba, Laguna v. Emelita A. Reblara, Eugenia Almazan &
Devorah E. Bardillon,' was filed before the Municipal Trial Court of Calamba, Laguna
The Issues
('MTC') on February 23, 1998, following the failure of Barangay Masili to reach an
agreement with herein petitioner on the purchase offer of TWO HUNDRED
THOUSAND PESOS (P200,000.00). The expropriation of Lot 4381-D was being In her Memorandum, petitioner raises the following issues for our consideration:
pursued in view of providing Barangay Masili a multi-purpose hall for the use and
benefit of its constituents. "A. Whether or not, the Honorable Respondent Court committed grave abuse of
discretion amounting to lack of jurisdiction when it denied and dismissed petitioner's
"On March 5, 1999, the MTC issued an order dismissing Civil Case No. 3648 'for lack appeal;
of interest' for failure of the [respondent] and its counsel to appear at the pre-trial. The

48
"B. Whether or not, the Honorable Respondent Court committed grave abuse of "It should be stressed that the primary consideration in an expropriation suit is whether
discretion when it did not pass upon and consider the pending Motion for the government or any of its instrumentalities has complied with the requisites for the
Reconsideration which was not resolved by the Regional Trial Court before issuing the taking of private property. Hence, the courts determine the authority of the government
questioned Orders of 4 and 16 August 2000; entity, the necessity of the expropriation, and the observance of due process. In the
main, the subject of an expropriation suit is the government's exercise of eminent
"C. Whether or not, the Honorable Respondent Court committed grave abuse of domain, a matter that is incapable of pecuniary estimation.
discretion in taking the total amount of the assessed value of the land and building to
confer jurisdiction to the court a quo; "True, the value of the property to be expropriated is estimated in monetary terms, for
the court is duty-bound to determine the just compensation for it. This, however, is
"D. Whether or not, the Honorable Respondent Court committed grave abuse of merely incidental to the expropriation suit. Indeed, that amount is determined only after
discretion in ignoring the fact that there is an existing multi-purpose hall erected in the the court is satisfied with the propriety of the expropriation."
land owned by Eugenia Almazan which should be subject of expropriation; and
"Verily, the Court held in Republic of the Philippines v. Zurbano that 'condemnation
"E. Whether or not, the Honorable Respondent Court committed grave abuse of proceedings are within the jurisdiction of Courts of First Instance,' the forerunners of
discretion in failing to consider the issue of forum shopping committed by Respondent the regional trial courts. The said case was decided during the effectivity of the
Masili."8 Judiciary Act of 1948 which, like BP 129 in respect to RTCs, provided that courts of
first instance had original jurisdiction over 'all civil actions in which the subject of the
Simply put, the issues are as follows: (1) whether the MTC had jurisdiction over the litigation is not capable of pecuniary estimation.' The 1997 amendments to the Rules of
expropriation case; (2) whether the dismissal of that case before the MTC constituted res Court were not intended to change these jurisprudential precedents.14
judicata; (3) whether the CA erred when it ignored the issue of entry upon the premises; and
(4) whether respondent is guilty of forum shopping. To reiterate, an expropriation suit is within the jurisdiction of the RTC regardless of the value of
the land, because the subject of the action is the government's exercise of eminent domain —
The Court's Ruling a matter that is incapable of pecuniary estimation.

Second Issue:
The Petition has no merit.
Res Judicata
First Issue:
Jurisdiction Over Expropriation Petitioner claims that the MTC's dismissal of the first Complaint for eminent domain was with
prejudice, since there was no indication to the contrary in the Order of dismissal. She contends
that the filing of the second Complaint before the RTC should therefore be dismissed on
Petitioner claims that, since the value of the land is only P11,448, the MTC had jurisdiction account of res judicata.
over the case.9
Res judicata literally means a matter adjudged, judicially acted upon or decided, or settled by
On the other hand, the appellate court held that the assessed value of the property was judgment.15 It provides that a final judgment on the merits rendered by a court of competent
P28,960.10 Thus, the MTC did not have jurisdiction over the expropriation proceedings, jurisdiction is conclusive as to the rights of the parties and their privies; and constitutes an
because the amount involved was beyond the P20,000 jurisdictional amount cognizable by absolute bar to subsequent actions involving the same claim, demand or cause of action. 16
MTCs.
The following are the requisites of res judicata: (1) the former judgment must be final; (2) the
An expropriation suit does not involve the recovery of a sum of money. Rather, it deals with the court that rendered it had jurisdiction over the subject matter and the parties; (3) it is a
exercise by the government of its authority and right to take property for public use. 11 As such, judgment on the merits; and (4) there is — between the first and the second actions — an
it is incapable of pecuniary estimation and should be filed with the regional trial courts. 12 identity of parties, subject matter and cause of action. 17

This was explained by the Court in Barangay San Roque v. Heirs of Francisco Pastor:13
49
Since the MTC had no jurisdiction over expropriation proceedings, the doctrine of res pending, a final judgment in the MTC case will not constitute res judicata in the RTC, since the
judicata finds no application even if the Order of dismissal may have been an adjudication on former had no jurisdiction over the expropriation case.
the merits.
WHEREFORE, the Petition is DENIED and the assailed Decision AFFIRMED. Costs against
Third Issue: petitioner. SO ORDERED.
Legality of Entry Into Premises

Petitioner argues that the CA erred when it ignored the RTC's Writ of Possession over her
property, issued despite the pending Motion for Reconsideration of the ruling dismissing the
Complaint. We are not persuaded.

The requirements for the issuance of a writ of possession in an expropriation case are
expressly and specifically governed by Section 2 of Rule 67 of the 1997 Rules of Civil
Procedure.18 On the part of local government units, expropriation is also governed by Section
19 of the Local Government Code.19 Accordingly, in expropriation proceedings, the requisites
for authorizing immediate entry are as follows: (1) the filing of a complaint for expropriation
sufficient in form and substance; and (2) the deposit of the amount equivalent to 15 percent of
the fair market value of the property to be expropriated based on its current tax declaration. 20

In the instant case, the issuance of the Writ of Possession in favor of respondent after it had
filed the Complaint for expropriation and deposited the amount required was proper, because it
had complied with the foregoing requisites.

The issue of the necessity of the expropriation is a matter properly addressed to the RTC in the
course of the expropriation proceedings. If petitioner objects to the necessity of the takeover of
her property, she should say so in her Answer to the Complaint. 21 The RTC has the power to
inquire into the legality of the exercise of the right of eminent domain and to determine whether
there is a genuine necessity for it.22

Fourth Issue:
Forum Shopping

Petitioner claims that respondent is guilty of forum shopping, because it scouted for another
forum after obtaining an unfavorable Decision from the MTC.

The test for determining the presence of forum shopping is whether the elements of litis
pendentia are present in two or more pending cases, such that a final judgment in one case
will amount to res judicata in another.23

Be it noted that the earlier case lodged with the MTC had already been dismissed when the
Complaint was filed before the RTC. Even granting arguendo that both cases were still

50
G.R. No. 163021 April 27, 2007 The trial court decided in favor of Payoyo, reasoning that the power to rescind is implied in
PATRICIO A. VILLENA vs. PATRICIO S. PAYOYO reciprocal obligations. Considering that Villena repeatedly failed to comply with his obligation,
Payoyo had the right to rescind the contract and demand a refund. The trial court ordered
This petition for review on certiorari assails the Decision 1 dated November 21, 2003 of the petitioner to pay respondent P184,821.50 as actual damages plus 12% interest per annum
Court of Appeals in CA-G.R. CV No. 70513 and its Resolution2 dated March 18, 2004, denying from the date of filing of the complaint and P20,000 as moral damages plus legal interest from
petitioner’s motion for reconsideration. The appellate court had affirmed with modification the judicial demand until fully paid.
Decision3 dated April 26, 2000 of the Regional Trial Court (RTC) of Quezon City, Branch 78.
The Court of Appeals affirmed the RTC decision with the following modifications:
The facts are undisputed.
1) [Petitioner Villena is] hereby ordered to pay [respondent Payoyo] actual damages in
On October 28, 1997, respondent Patricio Payoyo and Novaline, Inc., through its president, the amount of P155,183.00 with 12% interest per annum from the date of the filing of
petitioner Patricio Villena, entered into a contract for the delivery and installation of kitchen the complaint;
cabinets in Payoyo’s residence. The cabinets were to be delivered within ninety days from
downpayment of 50% of the purchase price. On October 29, 1997, Payoyo paid 2) [Petitioner is] likewise ordered to deliver the Indesit Multifunction Oven and Indesit
Villena P155,183 as downpayment. Hob in favor of [respondent] within thirty (30) days from the finality of this decision; and

On December 9, 1997, Payoyo entered into another contract with Villena for the delivery of 3) [Respondent] is hereby ordered to pay the purchase price of the Indesit
home appliances. On the same day, Payoyo paid 50% of the purchase price equal Multifunction Oven and Indesit Hob in favor of [petitioner] on the day the delivery is
to P29,638.50 as downpayment. made.4

However, Villena failed to install the kitchen cabinets and deliver the appliances. Payoyo made The appellate court reasoned that while there was delay in the delivery and installation of the
several demands upon Villena but the latter failed to comply. kitchen cabinets, there was none in the delivery of the appliances. The contract for said
appliances did not specify the date of delivery but that delivery should be made upon payment
In a letter dated March 12, 1998, Payoyo demanded the cancellation of the contracts and the of the 50% balance of the purchase price. Considering that Payoyo failed to pay the balance,
refund in full of the downpayments amounting to P184,821.50. Villena promised to install the Villena did not incur delay.
kitchen cabinets on or before May 10, 1998 and to deliver the appliances. Despite repeated
demands, Villena again failed to do so. Hence, the instant petition, where petitioner raises the following issues:

Payoyo sent Villena two demand letters on June 24, 1998 and on July 28, 1998 asking the I.
latter to either deliver all items or return the downpayments.
WHETHER OR NOT THE TRIAL COURT HAD JURISDICTION OVER THE SUBJECT
On October 26, 1998, Payoyo filed a complaint for recovery of a sum of money and damages MATTER OF THE CASE.
against Villena. Villena moved to dismiss the complaint for failure to state a cause of action. He
argued that there was no ground to cancel the contract; thus, there was no basis for refund. II.
The trial court denied his motion. Villena thereafter filed an answer with compulsory
counterclaim citing as an affirmative defense Payoyo’s failure to state a cause of action. WHETHER OR NOT [THE] DEFENDANTS-APPELLANTS (PETITIONER AND NOVALINE,
INC.), ARE ESTOPPED FROM QUESTIONING THE JURISDICTION OF THE COURT
On June 1, 1999, immediately after the trial court issued a pre-trial order, Villena filed a second UNDER THE CIRCUMSTANCES.5
motion to dismiss on the ground of lack of jurisdiction over the subject matter but it was denied.
Thereafter, trial ensued. Simply, the issue in this case is whether the trial court had jurisdiction over the complaint.

51
Petitioner maintains that the RTC should have dismissed the complaint for lack of jurisdiction. 7. Under their Contracts, prestation and/or delivery of the items will be performed and delivered
He posits that the RTC has no jurisdiction over the complaint since it is mainly for recovery of a within NINETY (90) DAYS from the receipt of downpayment. Plaintiff complied with its
sum of money in the amount of P184,821.50 which is below the jurisdictional amount set for prestation but defendants defaulted with their obligation;
RTCs.6 Moreover, petitioner contends that the issue of jurisdiction may be raised at any time,
even on appeal, since jurisdiction is conferred only by law and cannot be acquired through or 10. On 12 March 1998, plaintiff sent letter to defendants requesting the latter for the
waived by any act or omission of the parties.7 cancellation of the purchase contracts and refund in full the (50%) downpayment paid in the
total amount of (P 184, 821.50) within five (5) days upon receipt of the letter…
Respondent, on the other hand, contends that the RTC has jurisdiction over the complaint as
the allegations therein show that it is actually a case for rescission of the contracts. The 12. On 24 March 1998, plaintiff and defendant Patricio A. Villena, personally talked [to] each
recovery of a sum of money is merely a necessary consequence of the cancellation of the other regarding the full refund of the (50%) downpayment in the amount of P 184, 821.50.
contracts.8 Defendant informed the plaintiff that it was their fault because the order from their Australian
supplier was made only on 15 December 1997. Defendant promised plaintiff [delivery of] the
The pertinent portion of Section 19 of Batas Pambansa Bilang 129, as amended by Republic three (3) Kitchen Cabinets on or before 10 [M]ay 1998, and the three (3) home appliances
Act No. 7691,9provides: were considered fully paid applying the (50%) downpayment of (P 29,638.50) for home
appliances only. But defendant did not fulfill his promise;
SEC. 19. Jurisdiction in civil cases.—Regional Trial Courts shall exercise exclusive original
jurisdiction: 13. Despite all these, repeated demands for the installation of the (3) three kitchen [c]abinets
and complete delivery of home appliances were made, but defendants did nothing;
(1) In all civil actions in which the subject of the litigation is incapable of pecuniary estimation;
(Emphasis added.)
(8) In all other cases in which the demand, exclusive of interest, damages of whatever kind,
attorney’s fees, litigation expenses, and costs or the value of the property in controversy A case for breach of contract is a cause of action either for specific performance or rescission
exceeds One Hundred Thousand pesos (P100,000.00) or, in such other cases in Metro Manila, of contracts.13 An action for rescission of contract, as a counterpart of an action for specific
where the demand, exclusive of the abovementioned items exceeds Two Hundred Thousand performance, is incapable of pecuniary estimation, and therefore falls under the jurisdiction of
pesos (P200,000.00). the RTC.14 In the present case, the averments in the complaint show that Payoyo sought the
cancellation of the contracts and refund of the downpayments since Villena failed to comply
In determining the jurisdiction of an action whose subject is incapable of pecuniary estimation, with the obligation to deliver the appliances and install the kitchen cabinets subject of the
the nature of the principal action or remedy sought must first be ascertained. If it is primarily for contracts. The court then must examine the facts and the applicable law to determine whether
the recovery of a sum of money, the claim is considered capable of pecuniary estimation and there is in fact substantial breach that would warrant rescission or cancellation of the contracts
the jurisdiction of the court depends on the amount of the claim. But, where the primary issue and entitle the respondent for a refund. While the respondent prayed for the refund, this is just
is something other than the right to recover a sum of money, where the money claim is purely incidental to the main action, which is the rescission or cancellation of the contracts.
incidental to, or a consequence of, the principal relief sought, such are actions whose subjects
are incapable of pecuniary estimation, hence cognizable by the RTCs. 10 WHEREFORE, the petition is DENIED for lack of merit. The Decision dated November 21,
2003 of the Court of Appeals in CA-G.R. CV No. 70513 and the Resolution dated March 18,
Verily, what determines the nature of the action and which court has jurisdiction over it are the 2004 are AFFIRMED. Costs against petitioner. SO ORDERED.
allegations of the complaint and the character of the relief sought.11

In our considered view, the complaint, albeit entitled as one for collection of a sum of money
with damages, is one incapable of pecuniary estimation; thus, one within the RTC’s jurisdiction.
The allegations therein show that it is actually for breach of contract, thus,

52
G.R. No. 153690 February 15, 2011 In compliance with the Court’s Resolution of January 11, 2010, Kelly Lu Ym, Victor Lu Ym and
DAVID LU vs. PATERNO LU YM, SR., PATERNO LU YM, JR., VICTOR LU YM, JOHN LU YM, Paterno Lu Ym, Jr. filed a Comment/Opposition of March 20, 2010, while John Lu Ym and LLDC
KELLY LU YM, and LUDO & LUYM DEVELOPMENT CORPORATION filed a Consolidated Comment of March 25, 2010, a Supplement thereto of April 20, 2010, and a
Manifestation of May 24, 2010.
By Decision of August 26, 2008, the Court1 unanimously disposed of the three present petitions as
follows: The present cases were later referred to the Court en banc by Resolution of October 20, 2010.

WHEREFORE, premises considered, the petitions in G.R. Nos. 153690 and 157381 are DENIED Brief Statement of the Antecedents
for being moot and academic; while the petition in G.R. No. 170889 is DISMISSED for lack of merit.
Consequently, the Status QuoOrder dated January 23, 2006 is hereby LIFTED. The three consolidated cases stemmed from the complaint for "Declaration of Nullity of Share Issue,
Receivership and Dissolution" filed on August 14, 2000 before the Regional Trial Court (RTC) of
The Court of Appeals is DIRECTED to proceed with CA-G.R. CV No. 81163 and to resolve the Cebu City by David Lu, et al.against Paterno Lu Ym, Sr. and sons (Lu Ym father and sons) and
same with dispatch. LLDC.

SO ORDERED[,]2 By Decision of March 1, 2004, Branch 12 of the RTC ruled in favor of David et al. by annulling the
issuance of the shares of stock subscribed and paid by Lu Ym father and sons at less than par
which Decision was, on motion for reconsideration, the Court voting 4-1,3 reversed by Resolution value, and ordering the dissolution and asset liquidation of LLDC. The appeal of the trial court’s
of August 4, 2009, the dispositive portion of which reads: Decision remains pending with the appellate court in CA-G.R. CV No. 81163.

WHEREFORE, in view of the foregoing, the Motion for Reconsideration filed by John Lu Ym and Several incidents arising from the complaint reached the Court through the present three petitions.
Ludo & LuYm Development Corporation is GRANTED. The Decision of this Court dated August 26,
2008 is RECONSIDERED and SET ASIDE. The Complaint in SRC Case No. 021-CEB, now on In G.R. No. 153690 wherein David, et al. assailed the appellate court’s resolutions dismissing their
appeal with the Court of Appeals in CA-G.R. CV No. 81163, is DISMISSED. complaint for its incomplete signatory in the certificate of non-forum shopping and consequently
annulling the placing of the subject corporation under receivership pendente lite, the Court, by
All interlocutory matters challenged in these consolidated petitions are DENIED for being moot and Decision of August 26, 2008, found the issue to have been mooted by the admission by the trial
academic. court of David et al.’s Amended Complaint, filed by them pursuant to the trial court’s order to
conform to the requirements of the Interim Rules of Procedure Governing Intra-Corporate
Controversies.
SO ORDERED.4
Since an amended pleading supersedes the pleading that it amends, the original complaint of
David Lu’s Motion for Reconsideration and Motion to Refer Resolution to the Court En Banc was David, et al. was deemed withdrawn from the records.
denied by minute Resolution of September 23, 2009.
The Court noted in G.R. No. 153690 that both parties admitted the mootness of the issue and that
Following his receipt on October 19, 2009 of the minute Resolution, David Lu personally filed on
the trial court had already rendered a decision on the merits of the case. It added that the Amended
October 30, 2009 a Second Motion for Reconsideration and Motion to Refer Resolution to the
Complaint stands since Lu Ym father and sons availed of an improper mode (via an Urgent Motion
Court En Banc. On even date, he filed through registered mail an "Amended Second Motion for filed with this Court) to assail the admission of the Amended Complaint.
Reconsideration and Motion to Refer Resolution to the Court En Banc." And on November 3, 2009,
he filed a "Motion for Leave to File [a] Motion for Clarification[, and the] Second Motion for
Reconsideration and Motion to Refer Resolution to the Court En Banc." He later also filed a In G.R. No. 157381 wherein Lu Ym father and sons challenged the appellate court’s resolution
"Supplement to Second Motion for Reconsideration with Motion to Dismiss" dated January 6, 2010. restraining the trial court from proceeding with their motion to lift the receivership order which was
filed during the pendency of G.R. No. 153690, the Court, by Decision of August 26, 2008 resolved
that the issue was mooted by the amendment of the complaint and by the trial court’s decision on
John Lu Ym and Ludo & Luym Development Corporation (LLDC), meanwhile, filed with leave a
the merits. The motion having been filed ancillary to the main action, which main action was already
Motion5 for the Issuance of an Entry of Judgment of February 2, 2010, which merited an Opposition decided on the merits by the trial court, the Court held that there was nothing more to enjoin.
from David Lu.

53
G.R. No. 170889 involved the denial by the appellate court of Lu Ym father and sons’ application in (j) cases involving conflicting decisions of two or more divisions;
CA-G.R. CV No. 81163 for a writ of preliminary injunction. By August 26, 2008 Decision, the Court
dismissed the petition after finding no merit on their argument – which they raised for the first time in (k) cases where three votes in a Division cannot be obtained;
their motion for reconsideration before the appellate court – of lack of jurisdiction for non-payment of
the correct RTC docket fees.
(l) Division cases where the subject matter has a huge financial impact on businesses or
affects the welfare of a community;
As reflected early on, the Court, in a turnaround, by Resolution of August 4, 2009, reconsidered its
position on the matter of docket fees. It ruled that the trial court did not acquire jurisdiction over the
(m) Subject to Section 11 (b) of this rule, other division cases that, in the opinion of at least
case for David Lu, et al.’s failure to pay the correct docket fees, hence, all interlocutory matters and
incidents subject of the present petitions must consequently be denied. three Members of the Division who are voting and present, are appropriate for transfer to
the Court en banc;
Taking Cognizance of the Present Incidents
(n) cases that the Court en banc deems of sufficient importance to merit its attention; and
The Internal Rules of the Supreme Court (IRSC) states that the Court en banc shall act on the
following matters and cases: (o) all matters involving policy decisions in the administrative supervision of all courts and
their personnel.6(underscoring supplied)
(a) cases in which the constitutionality or validity of any treaty, international or executive
The enumeration is an amalgamation of SC Circular No. 2-89 (February 7, 1989), as amended by
agreement, law, executive order, presidential decree, proclamation, order, instruction,
ordinance, or regulation is in question; En Banc Resolution of November 18, 1993, and the amplifications introduced by Resolution of
January 18, 2000 in A.M. No. 99-12-08-SC with respect to administrative cases and matters.

(b) criminal cases in which the appealed decision imposes the death penalty or reclusion
perpetua; The present cases fall under at least three types of cases for consideration by the Court En Banc.
At least three members of the Court’s Second Division (to which the present cases were
transferred,7 they being assigned to a Member thereof) found, by Resolution of October 20, 2010,
(c) cases raising novel questions of law; that the cases were appropriate for referral-transfer to the Court En Banc which subsequently
accepted8 the referral in view of the sufficiently important reason to resolve all doubts on the validity
(d) cases affecting ambassadors, other public ministers, and consuls; of the challenged resolutions as they appear to modify or reverse doctrines or principles of law.

(e) cases involving decisions, resolutions, and orders of the Civil Service Commission, the In Firestone Ceramics v. Court of Appeals,9 the Court treated the consolidated cases as En Banc
Commission on Elections, and the Commission on Audit; cases and set the therein petitioners’ motion for oral argument, after finding that the cases were of
sufficient importance to merit the Court En Banc’s attention. It ruled that the Court’s action is a
(f) cases where the penalty recommended or imposed is the dismissal of a judge, the legitimate and valid exercise of its residual power.10
disbarment of a lawyer, the suspension of any of them for a period of more than one year,
or a fine exceeding forty thousand pesos; In Limketkai Sons Milling, Inc. v. Court of Appeals, the Court conceded that it is not infallible. Should
any error of judgment be perceived, it does not blindly adhere to such error, and the parties
(g) cases covered by the preceding paragraph and involving the reinstatement in the adversely affected thereby are not precluded from seeking relief therefrom, by way of a motion for
judiciary of a dismissed judge, the reinstatement of a lawyer in the roll of attorneys, or the reconsideration. In this jurisdiction, rectification of an error, more than anything else, is of paramount
lifting of a judge’s suspension or a lawyer’s suspension from the practice of law; importance.

(h) cases involving the discipline of a Member of the Court, or a Presiding Justice, or any xxxx
Associate Justice of the collegial appellate court;
It bears stressing that where, as in the present case, the Court En Banc entertains a case for its
(i) cases where a doctrine or principle laid down by the Court en banc or by a Division my resolution and disposition, it does so without implying that the Division of origin is incapable of
be modified or reversed; rendering objective and fair justice. The action of the Court simply means that the nature of the

54
cases calls for en banc attention and consideration. Neither can it be concluded that the Court has of modification or reversal of a doctrine, as may be deemed by the Court. Ultimately, it is the entire
taken undue advantage of sheer voting strength. It was merely guided by the well-studied finding Court which shall decide on the acceptance of the referral and, if so, "to reconcile any
and sustainable opinion of the majority of its actual membership– that, indeed, subject cases are of seeming conflict, to reverse or modify an earlier decision, and to declare the Court’s doctrine."18
sufficient importance meriting the action and decision of the whole Court. It is, of course, beyond
cavil that all the members of this highest Court of the land are always embued with the noblest of The Court has the power and prerogative to suspend its own rules and to exempt a case from their
intentions in interpreting and applying the germane provisions of law, jurisprudence, rules and operation if and when justice requires it,19 as in the present circumstance where movant filed a
Resolutions of the Court– to the end that public interest be duly safeguarded and rule of law be motion for leave after the prompt submission of a second motion for reconsideration but,
observed.11 nonetheless, still within 15 days from receipt of the last assailed resolution.

It is argued that the assailed Resolutions in the present cases have already become final, 12 since a Well-entrenched doctrines or principles of law that went astray need to be steered back to their
second motion for reconsideration is prohibited except for extraordinarily persuasive reasons and proper course. Specifically, as David Lu correctly points out, it is necessary to reconcile and declare
only upon express leave first obtained;13 and that once a judgment attains finality, it thereby the legal doctrines regarding actions that are incapable of pecuniary estimation, application of
becomes immutable and unalterable, however unjust the result of error may appear. estoppel by laches in raising an objection of lack of jurisdiction, and whether bad faith can be
deduced from the erroneous annotation of lis pendens.
The contention, however, misses an important point. The doctrine of immutability of decisions
applies only to final and executory decisions. Since the present cases may involve a modification or Upon a considered, thorough reexamination, the Court grants David Lu’s Motion for
reversal of a Court-ordained doctrine or principle, the judgment rendered by the Special Third Reconsideration. The assailed Resolutions of August 4, 2009 and September 23, 2009, which
Division may be considered unconstitutional, hence, it can never become final. It finds mooring in turn turtle settled doctrines, must be overturned. The Court thus reinstates the August 26, 2008
the deliberations of the framers of the Constitution: Decision wherein a three-tiered approach was utilized to analyze the issue on docket fees:

On proposed Section 3(4), Commissioner Natividad asked what the effect would be of a decision In the instant case, however, we cannot grant the dismissal prayed for because of the following
that violates the proviso that "no doctrine or principle of law laid down by the court in a decision reasons: First, the case instituted before the RTC is one incapable of pecuniary estimation.
rendered en banc or in division may be modified or reversed except by the court en banc." The Hence, the correct docket fees were paid. Second, John and LLDC are estopped from
answer given was that such a decision would be invalid. Following up, Father Bernas questioning the jurisdiction of the trial court because of their active participation in the
asked whether the decision, if not challenged, could become final and bindingat least on the parties. proceedings below, and because the issue of payment of insufficient docket fees had been
Romulo answered that, since such a decision would be in excess of jurisdiction, the decision belatedly raised before the Court of Appeals, i.e., only in their motion for reconsideration. Lastly,
on the case could be reopened anytime.14 (emphasis and underscoring supplied) assuming that the docket fees paid were truly inadequate, the mistake was committed by the
Clerk of Court who assessed the same and not imputable to David; and as to the deficiency,
A decision rendered by a Division of this Court in violation of this constitutional provision would be in if any, the same may instead be considered a lien on the judgment that may thereafter be
excess of jurisdiction and, therefore, invalid.15 Any entry of judgment may thus be said to be rendered.20 (italics in the original; emphasis and underscoring supplied)
"inefficacious"16 since the decision is void for being unconstitutional.
The Value of the Subject Matter Cannot be Estimated
While it is true that the Court en banc exercises no appellate jurisdiction over its Divisions, Justice
Minerva Gonzaga-Reyes opined in Firestone and concededly recognized that "[t]he only constraint On the claim that the complaint had for its objective the nullification of the issuance of 600,000
is that any doctrine or principle of law laid down by the Court, either rendered en banc or in division, shares of stock of LLDC, the real value of which based on underlying real estate values, as alleged
may be overturned or reversed only by the Court sitting en banc."17 in the complaint, stands at P1,087,055,105, the Court’s assailed August 4, 2009 Resolution found:

That a judgment must become final at some definite point at the risk of occasional error cannot be Upon deeper reflection, we find that the movants’ [Lu Ym father & sons] claim has merit. The
appreciated in a case that embroils not only a general allegation of "occasional error" but also a 600,000 shares of stock were, indeed, properties in litigation. They were the subject matter of the
serious accusation of a violation of the Constitution, viz., that doctrines or principles of law were complaint, and the relief prayed for entailed the nullification of the transfer thereof and their return to
modified or reversed by the Court’s Special Third Division August 4, 2009 Resolution. LLDC. David, et al., are minority shareholders of the corporation who claim to have been prejudiced
by the sale of the shares of stock to the Lu Ym father and sons. Thus, to the extent of the damage
The law allows a determination at first impression that a doctrine or principle laid down by the or injury they allegedly have suffered from this sale of the shares of stock, the action they filed can
court en banc or in division may be modified or reversed in a case which would warrant a referral to be characterized as one capable of pecuniary estimation. The shares of stock have a definite value,
the Court En Banc. The use of the word "may" instead of "shall" connotes probability, not certainty, which was declared by plaintiffs [David Lu, et al.] themselves in their complaint. Accordingly, the
55
docket fees should have been computed based on this amount. This is clear from the following Petitioners argue that an action for annulment or rescission of a contract of sale of real property is a
version of Rule 141, Section 7, which was in effect at the time the complaint was filed[.] 21 (emphasis real action and, therefore, the amount of the docket fees to be paid by private respondent should be
and underscoring supplied) based either on the assessed value of the property, subject matter of the action, or its estimated
value as alleged in the complaint, pursuant to the last paragraph of §7(b) of Rule 141, as amended
The said Resolution added that the value of the 600,000 shares of stock, which are the properties in by the Resolution of the Court dated September 12, 1990. Since private respondents alleged that
litigation, should be the basis for the computation of the filing fees. It bears noting, however, the land, in which they claimed an interest as heirs, had been sold for P4,378,000.00 to petitioners,
that David, et al. are not claiming to own these shares. They do not claim to be the owners thereof this amount should be considered the estimated value of the land for the purpose of determining the
entitled to be the transferees of the shares of stock. The mention of the real value of the shares of docket fees.
stock, over which David, et al. do not, it bears emphasis, interpose a claim of right to
recovery, is merely narrative or descriptive in order to emphasize the inequitable price at which the On the other hand, private respondents counter that an action for annulment or rescission of a
transfer was effected. contract of sale of real property is incapable of pecuniary estimation and, so, the docket fees should
be the fixed amount of P400.00 in Rule 141, §7(b)(1). In support of their argument, they cite the
The assailed August 4, 2009 Resolution also stated that "to the extent of the damage or injury cases of Lapitan v. Scandia, Inc. and Bautista v. Lim. In Lapitan this Court, in an opinion by Justice
[David, et al.] allegedly have suffered from this sale," the action "can be characterized as one J.B.L. Reyes, held:
capable of pecuniary estimation." The Resolution does not, however, explore the value of the extent
of the damage or injury. Could it be the pro ratadecrease (e.g., from 20% to 15%) of the percentage A review of the jurisprudence of this Court indicates that in determining whether an action is one the
shareholding of David, et al. vis-à-vis to the whole? subject matter of which is not capable of pecuniary estimation, this Court has adopted the criterion
of first ascertaining the nature of the principal action or remedy sought. If it is primarily for the
Whatever property, real or personal, that would be distributed to the stockholders would be a mere recovery of a sum of money, the claim is considered capable of pecuniary estimation, and whether
consequence of the main action. In the end, in the event LLDC is dissolved, David, et jurisdiction is in the municipal courts or in the courts of first instance would depend on the amount of
al. would not be getting the value of the 600,000 shares, but only the value of their minority number the claim. However, where the basic issue is something other than the right to recover a sum of
of shares, which are theirs to begin with. money, or where the money claim is purely incidental to, or a consequence of, the principal relief
sought, like in suits to have the defendant perform his part of the contract (specific performance)
and in actions for support, or for annulment of a judgment or to foreclose a mortgage, this Court has
The complaint filed by David, et al. is one for declaration of nullity of share issuance. The main
considered such actions as cases where the subject of the litigation may not be estimated in terms
relief prayed for both in the original complaint and the amended complaint is the same, that is, to of money, and are cognizable exclusively by courts of first instance. The rationale of the rule is
declare null and void the issuance of 600,000 unsubscribed and unissued shares to Lu Ym father plainly that the second class cases, besides the determination of damages, demand an
and sons, et al. for a price of 1/18 of their real value, for being inequitable, having been done in inquiry into other factors which the law has deemed to be more within the competence of
breach of director’s fiduciary’s duty to stockholders, in violation of the minority stockholders’ rights, courts of first instance, which were the lowest courts of record at the time that the first organic
and with unjust enrichment.
laws of the Judiciary were enacted allocating jurisdiction (Act 136 of the Philippine Commission of
June 11, 1901).
As judiciously discussed in the Court’s August 26, 2008 Decision, the test in determining whether
the subject matter of an action is incapable of pecuniary estimation is by ascertaining the nature of
Actions for specific performance of contracts have been expressly pronounced to be exclusively
the principal action or remedy sought. It explained:
cognizable by courts of first instance: De Jesus vs. Judge Garcia, L-26816, February 28,
1967; Manufacturer's Distributors, Inc. vs. Yu Siu Liong, L-21285, April 29, 1966. And no cogent
x x x To be sure, the annulment of the shares, the dissolution of the corporation and the reason appears, and none is here advanced by the parties, why an action for rescission (or
appointment of receivers/management committee are actions which do not consist in resolution) should be differently treated, a "rescission" being a counterpart, so to speak, of
the recovery of a sum of money. If, in the end, a sum of money or real property would be "specific performance". In both cases, the court would certainly have to undertake an
recovered, it would simply be the consequence of such principal action. Therefore, the case before investigation into facts that would justify one act or the other. No award for damages may be
the RTC was incapable of pecuniary estimation.22 (italics in the original, emphasis and underscoring had in an action for rescission without first conducting an inquiry into matters which would
supplied) justify the setting aside of a contract, in the same manner that courts of first instance would have
to make findings of fact and law in actions not capable of pecuniary estimation expressly held to be
Actions which the Court has recognized as being incapable of pecuniary estimation include legality so by this Court, arising from issues like those raised in Arroz v. Alojado, et al., L-22153, March 31,
of conveyances. In a case involving annulment of contract, the Court found it to be one which 1967 (the legality or illegality of the conveyance sought for and the determination of the validity
cannot be estimated: of the money deposit made); De Ursua v. Pelayo, L-13285, April 18, 1950 (validity of a
judgment); Bunayog v. Tunas, L-12707, December 23, 1959 (validity of a mortgage); Baito v.
56
Sarmiento, L-13105, August 25, 1960 (the relations of the parties, the right to support created by the Meanwhile, Lu Ym father and sons attempted to verify the matter of docket fees from the Office of
relation, etc., in actions for support), De Rivera, et al. v. Halili, L-15159, September 30, 1963 (the the Court Administrator (OCA). In their Application for the issuance a writ of preliminary injunction
validity or nullity of documents upon which claims are predicated). Issues of the same nature may filed with the Court of Appeals, they still failed to question the amount of docket fees paid by David
be raised by a party against whom an action for rescission has been brought, or by the plaintiff Lu, et al. It was only in their Motion for Reconsideration of the denial by the appellate court of their
himself. It is, therefore, difficult to see why a prayer for damages in an action for rescission should application for injunctive writ that they raised such issue.
be taken as the basis for concluding such action as one capable of pecuniary estimation — a prayer
which must be included in the main action if plaintiff is to be compensated for what he may have Lu Ym father and sons’ further inquiry from the OCA cannot redeem them. A mere inquiry from
suffered as a result of the breach committed by defendant, and not later on precluded from an improper officeat that, could not, by any stretch, be considered as an act of having raised the
recovering damages by the rule against splitting a cause of action and discouraging multiplicity of jurisdictional question prior to the rendition of the trial court’s decision. In one case, it was held:
suits.23 (emphasis and underscoring supplied)
Here it is beyond dispute that respondents paid the full amount of docket fees as assessed by the
IN FINE, the Court holds that David Lu, et al.’s complaint is one incapable of pecuniary estimation, Clerk of Court of the Regional Trial Court of Malolos, Bulacan, Branch 17, where they filed the
hence, the correct docket fees were paid. The Court thus proceeds to tackle the arguments on complaint. If petitioners believed that the assessment was incorrect, they should have questioned it
estoppel and lien, mindful that the succeeding discussions rest merely on a before the trial court. Instead, petitioners belatedly question the alleged underpayment of docket
contrary assumption, viz., that there was deficient payment. fees through this petition, attempting to support their position with the opinion and
certification of the Clerk of Court of another judicial region. Needless to state, such
Estoppel Has Set In certification has no bearing on the instant case.27 (italics in the original; emphasis and
underscoring in the original)
Assuming arguendo that the docket fees were insufficiently paid, the doctrine of estoppel already
applies. The inequity resulting from the abrogation of the whole proceedings at this late stage when the
decision subsequently rendered was adverse to the father and sons is precisely the evil being
The assailed August 4, 2009 Resolution cited Vargas v. Caminas24 on the non-applicability of avoided by the equitable principle of estoppel.
the Tijam doctrine where the issue of jurisdiction was, in fact, raised before the trial court rendered
its decision. Thus the Resolution explained: No Intent to Defraud the Government

Next, the Lu Ym father and sons filed a motion for the lifting of the receivership order, which the trial Assuming arguendo that the docket fees paid were insufficient, there is no proof of bad faith to
court had issued in the interim. David, et al., brought the matter up to the CA even before the trial warrant a dismissal of the complaint, hence, the following doctrine applies:
court could resolve the motion. Thereafter, David, at al., filed their Motion to Admit Complaint to
Conform to the Interim Rules Governing Intra-Corporate Controversies. It was at this point that the x x x In Sun Insurance Office, Ltd., (SIOL) v. Asuncion, this Court ruled that the filing of the
Lu Ym father and sons raised the question of the amount of filing fees paid. They also raised this complaint or appropriate initiatory pleading and the payment of the prescribed docket fee vest a trial
point again in the CA when they appealed the trial court’s decision in the case below. court with jurisdiction over the subject matter or nature of the action. If the amount of docket fees
paid is insufficient considering the amount of the claim, the clerk of court of the lower court involved
We find that, in the circumstances, the Lu Ym father and sons are not estopped from challenging or his duly authorized deputy has the responsibility of making a deficiency assessment. The party
the jurisdiction of the trial court. They raised the insufficiency of the docket fees before the trial court filing the case will be required to pay the deficiency, but jurisdiction is not automatically
rendered judgment and continuously maintained their position even on appeal to the CA. Although lost.28 (underscoring supplied)
the manner of challenge was erroneous – they should have addressed this issue directly to the trial
court instead of the OCA – they should not be deemed to have waived their right to assail the The assailed Resolution of August 4, 2009 held, however, that the above-quoted doctrine does not
jurisdiction of the trial court.25 (emphasis and underscoring supplied) apply since there was intent to defraud the government, citing one attendant circumstance– the
annotation of notices of lis pendens on real properties owned by LLDC. It deduced:
Lu Ym father and sons did not raise the issue before the trial court. The narration of facts in the
Court’s original decision shows that Lu Ym father and sons merely inquired from the Clerk of Court From the foregoing, it is clear that a notice of lis pendens is availed of mainly in real actions. Hence,
on the amount of paid docket fees on January 23, 2004. They thereafter still "speculat[ed] on the when David, et al., sought the annotation of notices of lis pendens on the titles of LLDC, they
fortune of litigation."26 Thirty-seven days later or on March 1, 2004 the trial court rendered its acknowledged that the complaint they had filed affected a title to or a right to possession of real
decision adverse to them. properties. At the very least, they must have been fully aware that the docket fees would be based

57
on the value of the realties involved. Their silence or inaction to point this out to the Clerk of Court 2. Special civil actions except judicial foreclosure of
who computed their docket fees, therefore, becomes highly suspect, and thus, sufficient for this mortgage which shall be governed by paragraph …...….…….
Court to conclude that they have crossed beyond the threshold of good faith and into the area of (a) above xxx
fraud. Clearly, there was an effort to defraud the government in avoiding to pay the correct docket
fees. Consequently, the trial court did not acquire jurisdiction over the case.29 3. ……….……
All other actions not involving property
xxx
All findings of fraud should begin the exposition with the presumption of good faith. The inquiry is
not whether there was good faith on the part of David, et al., but whether there was bad faith on
their part. 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.
The erroneous annotation of a notice of lis pendens does not negate good faith. The
overzealousness of a party in protecting pendente lite his perceived interest, inchoate or otherwise, x x x x31 (emphasis supplied)
in the corporation’s properties from depletion or dissipation, should not be lightly equated to bad
faith. The Court, by Resolution of September 4, 2001 in A. M. No. 00-8-10-SC,32 clarified the matter of
legal fees to be collected in cases formerly cognizable by the Securities and Exchange Commission
That notices of lis pendens were erroneously annotated on the titles does not have the effect of following their transfer to the RTC.
changing the nature of the action. The aggrieved party is not left without a remedy, for they can
move to cancel the annotations. The assailed August 4, 2009 Resolution, however, deemed such Clarification has been sought on the legal fees to be collected and the period of appeal applicable in
act as an acknowledgement that the case they filed was a real action, concerning as it indirectly cases formerly cognizable by the Securities and Exchange Commission. It appears that the Interim
does the corporate realties, the titles of which were allegedly annotated. This conclusion does not Rules of Procedure on Corporate Rehabilitation and the Interim Rules of Procedure for Intra-
help much in ascertaining the filing fees because the value of these real properties and the value of Corporate Controversies do not provide the basis for the assessment of filing fees and the period of
the 600,000 shares of stock are different. appeal in cases transferred from the Securities and Exchange Commission to particular Regional
Trial Courts.
Further, good faith can be gathered from the series of amendments on the provisions on filing fees,
that the Court was even prompted to make a clarification.1avvphi1 The nature of the above mentioned cases should first be ascertained. Section 3(a), Rule 1 of the
1997 Rules of Civil Procedure defines civil action as one by which a party sues another for the
When David Lu, et al. filed the Complaint on August 14, 2000 or five days after the effectivity of the enforcement or protection of a right, or the prevention or redress of a wrong. It further states that a
Securities Regulation Code or Republic Act No. 8799,30 the then Section 7 of Rule 141 was the civil action may either be ordinary or special, both being governed by the rules for ordinary civil
applicable provision, without any restricted reference to paragraphs (a) and (b) 1 & 3 or paragraph actions subject to the special rules prescribed for special civil actions. Section 3(c) of the same
(a) alone. Said section then provided: Rule, defines a special proceeding as a remedy by which a party seeks to establish a status, a right,
or a particular fact.
SEC. 7. Clerks of Regional Trial Courts. –
Applying these definitions, the cases covered by the Interim Rules for Intra-Corporate
Controversies should be considered as ordinary civil actions. These cases either seek the
(a) For filing an action or a permissive counterclaim or money claim against an estate not recovery of damages/property or specific performance of an act against a party for the
based on judgment, or for filing with leave of court a third-party, fourth-party, etc. complaint, violation or protection of a right. These cases are:
or a complaint in intervention, and for all clerical services in the same, if the total sum
claimed, exclusive of interest, or the stated value of the property in litigation, is:
(1) Devices or schemes employed by, or any act of, the board of directors, business
associates, officers or partners, amounting to fraud or misrepresentation which may be
(b) For filing:
detrimental to the interest of the public and/or of the stockholders, partners, or members of
any corporation, partnership, or association;
1. Actions where the value of the subject matter ……….…..
cannot be estimated xxx (2) Controversies arising out of intra-corporate, partnership, or association relations,
between and among stockholders, members or associates; and between, any or all of them

58
and the corporation, partnership, or association of which they are stockholders, members filed on March 31, 2003 during which time the applicable rule expressed that paragraphs (a) and (b)
or associates, respectively; l & 3 shall be the basis for computing the filing fees in intra-corporate cases, recognizing that there
could be an intra-corporate controversy where the value of the subject matter cannot be estimated,
(3) Controversies in the election or appointment of directors, trustees, officers, or managers such as an action for inspection of corporate books. The immediate illustration shows that no
of corporations, partnerships, or associations; mistake can even be attributed to the RTC clerk of court in the assessment of the docket fees.

(4) Derivative suits; and Finally, assuming there was deficiency in paying the docket fees and assuming further that there
was a mistake in computation, the deficiency may be considered a lien on the judgment that may be
rendered, there being no established intent to defraud the government.
(5) Inspection of corporate books.
WHEREFORE, the assailed Resolutions of August 4, 2009 and September 23, 2009
On the other hand, a petition for rehabilitation, the procedure for which is provided in the Interim are REVERSED and SET ASIDE. The Court’s Decision of August 26, 2008 is REINSTATED.
Rules of Procedure on Corporate Recovery, should be considered as a special proceeding. It is one
that seeks to establish the status of a party or a particular fact. As provided in section 1, Rule 4 of
the Interim Rules on Corporate Recovery, the status or fact sought to be established is the inability The Court of Appeals is DIRECTED to resume the proceedings and resolve the remaining issues
of the corporate debtor to pay its debts when they fall due so that a rehabilitation plan, containing with utmost dispatch in CA-G.R. CV No. 81163. SO ORDERED.
the formula for the successful recovery of the corporation, may be approved in the end. It does not
seek a relief from an injury caused by another party.

Section 7 of Rule 141 (Legal Fees) of the Revised Rules of Court lays the amount of filing fees to be
assessed for actions or proceedings filed with the Regional Trial Court. Section 7(a) and (b) apply
to ordinary civil actionswhile 7(d) and (g) apply to special proceedings.

In fine, the basis for computing the filing fees in intra-corporate cases shall be section 7(a)
and (b) l & 3 of Rule 141. For petitions for rehabilitation, section 7(d) shall be applied. (emphasis
and underscoring supplied)

The new Section 21(k) of Rule 141 of the Rules of Court, as amended by A.M. No. 04-2-04-
SC33 (July 20, 2004), expressly provides that "[f]or petitions for insolvency or other cases
involving intra-corporate controversies, the fees prescribed under Section 7(a) shall apply." Notatu
dignum is that paragraph (b) 1 & 3 of Section 7 thereof was omitted from the reference. Said
paragraph34 refers to docket fees for filing "[a]ctions where the value of the subject matter cannot be
estimated" and "all other actions not involving property."

By referring the computation of such docket fees to paragraph (a) only, it denotes that an intra-
corporate controversy always involves a property in litigation, the value of which is always the basis
for computing the applicable filing fees. The latest amendments seem to imply that there can be no
case of intra-corporate controversy where the value of the subject matter cannot be estimated. Even
one for a mere inspection of corporate books.

If the complaint were filed today, one could safely find refuge in the express phraseology of Section
21 (k) of Rule 141 that paragraph (a) alone applies.

In the present case, however, the original Complaint was filed on August 14, 2000 during which time
Section 7, without qualification, was the applicable provision. Even the Amended Complaint was
59
G.R. No. 165777 July 25, 2011 The said land was sold to the defendant on October 3, 1960 (Annex C) and an Affidavit of
CEFERINA DE UNGRIA [DECEASED], substituted by her HEIRS, represented by LOLITA Relinquishment dated November 23, 1960 which was made a part thereof as Annex "D."
UNGRIA SAN JUAN-JAVIER, and RHODORA R. PELOMIDA as their Attorney-in-fact vs. CA, Considering the marriage of September 15, 1992, the said land became conjugal as of the date of
RTC, ROSARIO DIDELES VDA. DE CASTOR, NEPTHALIE CASTOR ITUCAS, FEROLYN the marriage and, therefore, ½ thereof belongs to the wife, Rosario Dideles Vda. de Castor.
CASTOR FACURIB, RACHEL DE CASTOR, LEA CASTOR DOLLOLOSA, and ROSALIE
CASTOR BENEDICTO Thus, considering the above, the motion to dismiss is DENIED.7

Assailed in this petition for review on certiorari are the Decision 1 dated May 26, 2004 and the Petitioner Ceferina filed a Motion for Reconsideration,8 which the RTC denied in an Order9 dated
Resolution2 dated September 17, 2004 of the Court of Appeals (CA) in CA-G.R. SP No. 60764. February 4, 2000.

On August 26, 1999, respondents Rosario Dideles Vda. de Castor (Rosario), Nepthalie Castor Petitioner filed an Omnibus Motion10 asking the RTC to resolve the issues of (1) whether or not the
Itucas, Ferolyn Castor Facurib (Ferolyn), Rachel De Castor, Lea Castor Dollolosa and Rosalie complaint should be dismissed or expunged from the records pursuant to Supreme Court (SC)
Castor Benedicto, filed with the Regional Trial Court (RTC) of General Santos City a Complaint 3 for Circular No. 7; (2) reconsidering the findings contained in the Order dated February 4, 2000; and (3)
ownership, possession and damages, and alternative causes of action either to declare two holding in abeyance the submission of the answer to the complaint.
documents as patent nullities, and/or for recovery of Rosario's conjugal share with damages or
redemption of the subject land against petitioner Ceferina de Ungria, defendants Avelino Gumban,
Pending resolution of the motion, respondents filed a Motion to Allow11 them to continue prosecuting
Dolores Cagaitan, Zacasio Poutan, PO1 Jonas Montales, Ignacio Olarte and alias Dory.
this case as indigent litigants.
Respondent Rosario is the surviving wife of the late Fernando Castor, while the rest of the
respondents are their legitimate children. The documents they sought to annul are (1) the Deed of
Transfer of Rights and Interest including Improvements thereon dated October 3, 1960 allegedly On March 8, 2000, the RTC resolved the Omnibus Motion in an Order12 that read in this wise:
executed by Fernando in favor of Eugenio de Ungria, petitioner's father; and (2) the Affidavit of
Relinquishment dated November 23, 1960 executed by Eugenio in favor of petitioner. On the omnibus motion regarding filing fees, the plaintiffs asserted in its motion that they are
charging defendant actual and compensatory damages such as are proved during the hearing of
Petitioner Ceferina filed a Motion to Dismiss4 (Ex-Abundante Ad Cautelam) on the following this case. So also are attorney’s fees and moral damages, all to be proved during the hearing of this
grounds: (1) the claim or demand has been extinguished by virtue of the valid sale of Lot No. 1615 case.
to Eugenio; (2) the action is barred by extraordinary acquisitive prescription; (3) the action is barred
by laches; and (4) plaintiff failed to state a cause of action, or filed the case prematurely for failure to Since there was no hearing yet, they are not in a possession (sic) to determine how much is to be
resort to prior barangay conciliation proceedings. charged.

Petitioner also filed an Addendum to the Motion to Dismiss 5 raising the following additional grounds: At any rate, if after hearing the Clerk of Court determine that the filing fees is still insufficient,
(1) plaintiffs have no legal capacity to sue; and (2) the court has no jurisdiction over the case for considering the total amount of the claim, the Clerk of Court should determine and, thereafter, if any
failure of plaintiffs to pay the filing fee in full. Respondents filed their Opposition thereto. amount is found due, he must require the private respondent to pay the same x x x.

On November 19, 1999, the RTC issued an Order6 denying the motion to dismiss, to wit: As to the second issue, the same has already been decided in its order dated February 4, 2000.

After the motion to dismiss and its addendum have been received, it is now ripe for resolution. One WHEREFORE, premises considered, the omnibus motion is DENIED.
of the grounds alleged in the complaint is for the recovery of conjugal share on Lot No. 1615, of Pls-
209 D with damages. The defendant shall file their answer within fifteen (15) days from receipt of this order.13

It is alleged that the late Fernando Castor and Rosario Dideles Vda. de Castor were married on From this Order, petitioner filed a motion for reconsideration and clarification on whether plaintiffs
September 15, 1952, and the application to the land was dated January 17, 1952 and the patent should be allowed to continue prosecuting the case as indigent litigants.
was issued by the President on November 19, 1954.
On March 30, 2000, the RTC issued a Clarificatory Order14 reading as follows:

60
As has been said, the plaintiff asserted in its motion that they are charging defendants actual and 19556); thus, it is axiomatic that adverse, notorious and continuous possession under a claim of
compensatory damages as has been proved during the hearing of this case. So also are attorney's ownership for the period fixed by law is ineffective against a Torrens title; that unless there are
fees and moral damages all to be proved during the hearing of this case. intervening rights of third persons which may be affected or prejudiced by a decision directing the
return of the lot to petitioner, the equitable defense of laches will not apply as against the registered
Since there was no hearing yet, they are not in a possession (sic) to determine how much is to be owner.
charged.
Hence, this petition for review on certiorari where petitioner raises the following assignment of
At any rate, after hearing, the Clerk of Court determines that the filing fee is still insufficient, the errors:
same shall be considered as lien on the judgment that may be entered.
THE COURT OF APPEALS ERRED IN NOT FINDING THAT RESPONDENT TRIAL
As to the motion seeking from the Honorable Court allowance to allow plaintiff to continue COURT COMMITTED GRAVE ABUSE OF DISCRETION IN DENYING PETITIONER'S
prosecuting this case as indigent litigants, suffice it to say that the same is already provided for in MOTION TO DISMISS DESPITE RESPONDENTS' NON-PAYMENT OF THE CORRECT
this order. DOCKET FEES.

WHEREFORE, the defendants shall file their answer within fifteen (15) days from receipt of this THE COURT OF APPEALS ERRED IN NOT FINDING THAT THE ACTION OF PRIVATE
Order.15 RESPONDENTS IS BARRED BY LACHES AND EXTRAORDINARY ACQUISITIVE
PRESCRIPTION.18
In an Order dated May 31, 2000, the RTC again denied petitioner's motion for reconsideration.
We find the petition without merit.
Petitioner filed with the CA a petition for certiorari and prohibition with prayer for the issuance of a
temporary restraining order and/or writ of preliminary injunction. Petitioner sought the nullification of Preliminarily, although not raised as an issue in this petition, we find it necessary to discuss the
the Order dated November 19, 1999 and the subsequent orders issued by the RTC thereto for issue of jurisdiction over the subject matter of this case. Respondents' complaint was filed in 1999,
having been issued with grave abuse of discretion amounting to lack or excess of jurisdiction. at the time Batas Pambansa Blg. (BP) 129, the Judiciary Reorganization Act of 1980, was already
Respondents filed their Comment thereto. amended by Republic Act (RA) No. 7691, An Act Expanding the Jurisdiction of the Metropolitan
Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts, amending for the purpose
BP Blg. 129.19 Section 1 of RA 7691, amending BP Blg. 129, provides that the RTC shall exercise
In a Decision dated May 26, 2004, the CA dismissed the petition. The CA found that SC Circular exclusive original jurisdiction on the following actions:
No. 7 would not apply where the amount of damages or value of the property was immaterial; that
the Circular could be applied only in cases where the amount claimed or the value of the personal
property was determinative of the court's jurisdiction citing the case of Tacay v. RTC of Tagum, Section 1. Section 19 of Batas Pambansa Blg. 129, otherwise known as the "Judiciary
Davao del Norte.16 The CA found that respondents had paid the corresponding docket fees upon Reorganization Act of 1980," is hereby amended to read as follows:
the filing of the complaint, thus, the RTC had acquired jurisdiction over the case despite the failure
to state the amount of damages claimed in the body of the complaint or in the prayer thereof. The Sec. 19. Jurisdiction in civil cases. – Regional Trial Courts shall exercise exclusive original
CA found that the RTC did not commit grave abuse of discretion amounting to lack of jurisdiction jurisdiction:
when it denied petitioner's motion to dismiss. It noted that the RTC's Clarificatory Order dated
March 30, 2000, which stated that "if after hearing the Clerk of Court determines that the filing fee is (1) In all civil actions in which the subject of the litigation is incapable of pecuniary
still insufficient, the same shall be considered as lien on the judgment that may be entered" was in estimation;
accordance with the rule laid down in Sun Insurance Office, Ltd. v. Asuncion. 17 The CA proceeded
to state that a judicious examination of the complaint pointed to a determination of the respective
(2) In all civil actions which involve the title to, or possession of, real property, or any
rights and interests of the parties over the property based on the issues presented therein which
could only be determined in a full-blown trial on the merits of the case. interest therein, where the assessed value of the property involved exceeds Twenty
Thousand Pesos (P20,000.00) or for civil actions in Metro Manila, where such value
exceeds Fifty Thousand Pesos (P50,000.00), except actions for forcible entry into and
Petitioner filed a Motion for Reconsideration, which the CA denied in a Resolution dated September unlawful detainer of lands or buildings, original jurisdiction over which is conferred upon the
17, 2004. The CA ruled, among others, that the defenses of acquisitive prescription and laches Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts; x x x
were likewise unavailing. It found that the subject property is covered by a Torrens title (OCT No. V-

61
Section 3 of RA No. 7691 expanded the exclusive original jurisdiction of the first level courts, thus: conjugal owner thereof and to account and reimburse her of its usufruct; and/or to allow them to
redeem the subject land.
Section 3. Section 33 of the same law (BP Blg. 129) is hereby amended to read as follows:
It would appear that the first cause of action involves the issue of recovery of possession and
Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial interest of the parties over the subject land which is a real action. Respondents alleged that the
Courts in Civil Cases. – Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial assessed value of the subject land was P12,780.00 based on Tax Declaration No. 15272. Thus,
Courts shall exercise: since it is a real action with an assessed value of less than P20,000.00, the case would fall under
the jurisdiction of the MTC as provided under the above-quoted Section 33 (3) of BP 129, as
amended.
(3) Exclusive original jurisdiction in all civil actions which involve title to, or possession of, real
property, or any interest therein where the assessed value of the property or interest therein does
not exceed Twenty Thousand Pesos (P20,000.00) or, in civil actions in Metro Manila, where such Notably, however, respondents in the same Complaint filed alternative causes of action assailing
assessed value does not exceed Fifty Thousand Pesos (P50,000.00) exclusive of interest, damages the validity of the Deed of Transfer of Rights and Interest executed by Fernando in favor of
of whatever kind, attorney's fees, litigation expenses and costs: Provided, That in cases of land not petitioner's father. Respondents also sought for the reconveyance to respondent Rosario of the
declared for taxation purposes, the value of such property shall be determined by the assessed undivided one-half portion of the subject land as conjugal owner thereof in case the Deed of
value of the adjacent lots. Transfer of Rights and Interest will be upheld as valid; and/or for redemption of the subject land.
Clearly, this is a case of joinder of causes of action which comprehends more than the issue of
possession of, or any interest in the real property under contention, but includes an action to annul
Respondents filed their Complaint with the RTC; hence, we would first determine whether the RTC
contracts and reconveyance which are incapable of pecuniary estimation and, thus, properly within
has jurisdiction over the subject matter of this case based on the above-quoted provisions.
the jurisdiction of the RTC.20

The Complaint filed by respondents in the RTC was for ownership, possession and damages, and In Singson v. Isabela Sawmill,21 we held that:
alternative causes of action either to declare two documents as patent nullities and/or for recovery
of conjugal share on the subject land with damages or redemption of the subject land. In their
Complaint, respondents claimed that Rosario and Fernando are the registered owners of the In determining whether an action is one the subject matter of which is not capable of pecuniary
subject land with an assessed value of P12,780.00; that the couple left the cultivation and estimation this Court has adopted the criterion of first ascertaining the nature of the principal action
enjoyment of the usufruct of the subject land to Fernando's mother and her second family to or remedy sought. If it is primarily for the recovery of a sum of money, the claim is considered
augment their means of livelihood; that respondent Rosario and Fernando thought that when the capable of pecuniary estimation, and whether jurisdiction is in the municipal courts or in the courts
latter's mother died in 1980, the subject land was in the enjoyment of the second family of his of first instance would depend on the amount of the claim. However, where the basic issue is
mother, but later learned that the subject land was leased by petitioner Ceferina; that sometime in something other than the right to recover a sum of money, where the money claim is purely
August 1999, respondents learned of the existence of the Deed of Transfer of Rights and Interest incidental to, or a consequence of, the principal relief sought, this Court has considered such
including Improvements thereon dated October 3, 1960, where Fernando had allegedly transferred actions as cases where the subject of the litigation may not be estimated in terms of money, and are
his rights and interests on the subject land in favor of Eugenio, petitioner Ceferina's father, as well cognizable exclusively by courts of first instance (now Regional Trial Courts).22
as an Affidavit of Relinquishment dated November 23, 1960 executed by Eugenio in favor of
petitioner Ceferina; that Fernando's signature in the Deed of Transfer was not his but a forgery; and Thus, respondents correctly filed their Complaint with the RTC.
the Affidavit of Relinquishment was also void as it was a direct result of a simulated Deed of
Transfer. It is a settled rule in this jurisdiction that when an action is filed in court, the complaint must be
accompanied by the payment of the requisite docket and filing fees.23 It is not simply the filing of the
Respondents prayed that they be declared as absolute and lawful owners of the subject land and to complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee, that vests
order petitioner and the other defendants to vacate the premises and restore respondents to its a trial court with jurisdiction over the subject matter or nature of the action.24
possession and enjoyment therefore. On their second cause of action, they prayed that the Deed of
Transfer of Rights and Interest Including Improvements Thereon be declared as a forgery, purely Section 7(b)(1) of Rule 141 of the Rules of Court provides:
simulated and without any consideration; hence, inexistent, void ab initio and/or a patent nullity, as
well as the Affidavit of Relinquishment which was the direct result of the Deed of Transfer.
SEC. 7. Clerks of Regional Trial Courts. - (a) For filing an action or a permissive counter-claim or
Respondents also prayed in the alternative that if the Deed be finally upheld as valid, to order
money claim against an estate not based on judgment, or for filing with leave of court a third-party,
petitioner to reconvey to respondent Rosario the undivided one-half portion of the subject land as

62
fourth-party, etc. complaint, or a complaint-in-intervention, and for all clerical services in the same, if (a) Ordering the defendants, jointly and severally, to pay plaintiffs actual and
the total-sum claimed, exclusive of interest, or the stated value of the property in litigation, is: compensatory damages such as are proved during the hearing of this case;

(b) For filing: (b) Ordering the defendants, jointly and severally, to pay plaintiffs attorneys' fees and moral
damages, all to be proved during the hearing of this case.28
1. Actions where the value of the subject matter
Thus, the RTC should have dismissed the case, since respondents did not specify the amount of
cannot be estimated ........ P400.00 damages in their prayer.

2. We are not persuaded.

In a real action, the assessed value of the property, or if there is none, the estimated value SC Circular No. 7 was brought about by our ruling in Manchester Development Corporation v. Court
thereof shall be alleged by the claimant and shall be the basis in computing the fees.25 of Appeals,29where we held that a pleading which does not specify in the prayer the amount of
damages being asked for shall not be accepted or admitted, or shall otherwise be expunged from
the record; and that the Court acquires jurisdiction over any case only upon the payment of the
Since we find that the case involved the annulment of contract which is not susceptible of pecuniary prescribed docket fee.
estimation, thus, falling within the jurisdiction of the RTC, the docket fees should not be based on
the assessed value of the subject land as claimed by petitioner in their memorandum, but should be
based on Section 7(b)(1) of Rule 141. A perusal of the entries in the Legal Fees Form attached to However, in Sun Insurance Office, Ltd. v. Asuncion,30 we laid down the following guidelines in the
the records would reflect that the amount of P400.00 was paid to the Clerk of Court, together with payment of docket fees, to wit:
the other fees, as assessed by the Clerk of Court. Thus, upon respondents' proof of payment of the
assessed fees, the RTC has properly acquired jurisdiction over the complaint. Jurisdiction once 1. It is not simply the filing of the complaint or appropriate initiatory pleading, but the
acquired is never lost, it continues until the case is terminated. 26 payment of the prescribed docket fee, that vests a trial court with jurisdiction over the
subject matter or nature of the action. Where the filing of the initiatory pleading is not
Notably, petitioner’s claim that the RTC did not acquire jurisdiction in this case is premised on her accompanied by payment of the docket fee, the court may allow payment of the fee within a
contention that respondents violated SC Circular No. 7 issued on March 24, 1998 requiring that all reasonable time but in no case beyond the applicable prescriptive or reglementary period.
complaints must specify the amount of damages sought not only in the body of the pleadings but
also in the prayer to be accepted and admitted for filing. Petitioner argues that respondents alleged 2. The same rule applies to permissive counterclaims, third-party claims and similar
in paragraph 13 of their Complaint that: pleadings, which shall not be considered filed until and unless the filing fee prescribed
therefor is paid. The court may also allow payment of said fee within a reasonable time but
(T)he reasonable rental for the use of the [subject] land is P2,000.00 per hectare, every crop time, also in no case beyond its applicable prescriptive or reglementary period.
once every four months, or P6,000.00 a year per hectare; that defendants in proportion and length
of time of their respective occupancy is and/or are jointly and severally liable to plaintiffs of the 3. Where the trial court acquires jurisdiction over a claim by the filing of the appropriate
produce thereby in the following proportions, viz: (a) for defendant Ceferina de Ungria for a period of pleading and payment of the prescribed filing fee but, subsequently, the judgment awards a
time claimed by her as such; (b) for defendants Dolores Cagautan, a certain alias "Dory," and PO1 claim not specified in the pleading, or if specified the same has been left for determination
Jonas Montales, of an undetermined area, the latter having entered the area sometime in 1998 and by the court, the additional filing fee therefor shall constitute a lien on the judgment. It shall
defendant alias "Dory," only just few months ago; that defendant Ignacio Olarte and Zacasio Puutan be the responsibility of the Clerk of Court or his duly-authorized deputy to enforce said lien
of occupying about one-half hectare each.27 and assess and collect the additional fee.

and in their prayer asked: Subsequently, in Heirs of Bertuldo Hinog v. Melicor,31 we said:

x x x Ordering the defendants, jointly and severally, in proportion to the length and area of their Furthermore, the fact that private respondents prayed for payment of damages "in amounts justified
respective occupancy, to pay reasonable rentals to the plaintiffs in the proportion and amount by the evidence" does not call for the dismissal of the complaint for violation of SC Circular No. 7,
assessed in paragraph 13 of the First Cause of Action. dated March 24, 1988 which required that all complaints must specify the amount of damages
sought not only in the body of the pleadings but also in the prayer in order to be accepted and
63
admitted for filing. Sun Insurance effectively modified SC Circular No. 7 by providing that filing fees The trial in this case has not yet started as in fact no answer has yet been filed. We find that these
for damages and awards that cannot be estimated constitute liens on the awards finally granted by issues are factual which must be resolved at the trial of this case on the merits wherein both parties
the trial court. will be given ample opportunity to prove their respective claims and defenses.

x x x judgment awards which were left for determination by the court or as may be proven during Anent petitioner's defense of laches, the same is evidentiary in nature and cannot be established by
trial would still be subject to additional filing fees which shall constitute a lien on the judgment. It mere allegations in the pleadings. Without solid evidentiary basis, laches cannot be a valid ground
would then be the responsibility of the Clerk of Court of the trial court or his duly-authorized deputy to dismiss respondents' complaint.35 Notably, the allegations of respondents in their petition filed
to enforce said lien and assess and collect the additional fees.32 before the RTC which alleged among others:

A reading of the allegations in the complaint would show that the amount of the rental due can only 7. That sometime between the years 1965 to 1970, defendant Ceferina de Ungria,
be determined after a final judgment, since there is a need to show supporting evidence when the accompanied by Miss Angela Jagna-an, appeared in the residence of plaintiff Rosario
petitioner and the other defendants started to possess the subject land. Thus, we find no reversible Dideles Vda. de Castor in Bo.1, Banga, South Cotabato, and requested her to sign a folded
error committed by the CA when it ruled that there was no grave abuse of discretion committed by document with her name only appearing thereon, telling her that it has something to do with
the RTC in issuing its Order dated March 30, 2000, where the RTC stated that "since there was no the land above-described, of which she refused telling her that she better return it to the
hearing yet, respondents are not in a position to determine how much is to be charged and that after person who requested her to do so (referring to her mother-in-law), more so that her
hearing, the Clerk of Court determines that the filing fee is still insufficient, the same shall be husband was out at that time;
considered as lien on the judgment that may be entered."
8. That when the matter was brought home to Fernando Castor, the latter just commented
Petitioner claims that the action is barred by extraordinary acquisitive prescription and laches. that [his] mother desires the land above-described to be sold to defendant Ceferina de
Petitioner contends that she took possession of the land in the concept of an owner, open, Ungria which however he was opposed to do so even as they occasionally come into
exclusive, notorious and continuous since 1952 through her predecessor-in-interest, Eugenio, and heated arguments everytime this insistence on the same subject propped up;
by herself up to the present; that the late Fernando and private respondents had never taken
possession of the land at any single moment; and that, granting without admitting that the transfer of 9. That even after the death of the mother of the late Fernando Castor in Bo. Bula, City of
rights between Fernando and Eugenio was null and void for any reason whatsoever, petitioner's General Santos, sometime in 1980, the latter and his surviving wife thought all the while
possession of the land had already ripened into ownership after the lapse of 30 years from August that the land above-described was in the enjoyment of his late mother's family with his 2nd
1952 by virtue of the extraordinary acquisitive prescription. husband; that it was only after sometime when plaintiff Rosario Dideles Vda. de Castor
heard that the land above-described had even been leased by defendant Ceferina de
We are not persuaded. Ungria with the Stanfilco and Checkered farm;

It is a well-entrenched rule in this jurisdiction that no title to registered land in derogation of the 10. That sometime in 1997, defendant Ceferina de Ungria sent overtures to plaintiffs
rights of the registered owner shall be acquired by prescription or adverse through Ester Orejana, who is the half sister-in-law of plaintiff Rosario Dideles Vda. de
possession.33 Prescription is unavailing not only against the registered owner but also against his Castor that she desires to settle with them relating to the land above-described; that the
hereditary successors.34 In this case, the parcel of land subject of this case is a titled property, i.e., overtures developed into defendant Ceferina de Ungria meeting for the purpose plaintiff
titled in the name of the late Fernando Castor, married to Rosario Dideles. Ferolyn Castor Facurib where the negotiation continued with Lolita Javier as attorney-in-
fact after defendant Ceferina de Ungria left to reside in Manila and which resulted later to
Petitioner claims that respondent had impliedly admitted the fact of sale by Fernando to Eugenio in the attorney-in-fact offering the plaintiffs P100,000.00 to quitclaim on their rights over the
August 1952, but only according to respondents, the sale was null and void because it violated the said land, which offer, however, was refused by plaintiffs as so [insignificant] as compared
provisions of the Public Land Act. Petitioner argues that the application of Fernando, dated January to the actual value of the same land; that in that negotiation, defendant Ceferina de Ungria
17, 1952, was not the homestead application referred to in Sections 118 and 124 of the Public Land was challenged to show any pertinent document to support her claim on the land in
Act; and that Fernando's application was only as settler, or for the allocation of the subject land to question and where she meekly answered by saying at the time that she does not have any
him vice the original settler Cadiente. of such document;

Such argument does not persuade. would not conclusively establish laches.1avvphil Thus, it is necessary for petitioners to proceed to
trial and present controverting evidence to prove the elements of laches. WHEREFORE, the petition
for review is DENIED. SO ORDERED.
64
G.R. No. 208232, March 10, 2014 Respondents Francisco and Welhilmina Lindo later entered into a compromise agreement with
petitioners, whereby they agreed to cede to Epifania a three thousand two hundred and thirty
SURVIVING HEIRS OF ALFREDO R. BAUTISTA, NAMELY: EPIFANIA G. BAUTISTA AND square meter (3,230 sq.m.)-portion of the property as well as to waive, abandon, surrender,
ZOEY G. BAUTISTA, Petitioners, v. FRANCISCO LINDO AND WELHILMINA LINDO; AND and withdraw all claims and counterclaims against each other. The compromise was approved
HEIRS OF FILIPINA DAQUIGAN, NAMELY: MA. LOURDES DAQUIGAN, IMELDA by the RTC in its Decision dated January 27, 2011, the fallo of which
CATHERINE DAQUIGAN, IMELDA DAQUIGAN AND CORSINO DAQUIGAN, REBECCA reads:chanRoblesVirtualawlibrary
QUIAMCO AND ANDRES QUIAMCO, ROMULO LORICA AND DELIA LORICA, GEORGE
CAJES AND LAURA CAJES, MELIDA BAÑEZ AND FRANCISCO BAÑEZ, MELANIE WHEREFORE, a DECISION is hereby rendered based on the above-quoted Compromise
GOFREDO, GERVACIO CAJES AND ISABEL CAJES, EGMEDIO SEGOVIA AND Agreement and the parties are enjoined to strictly comply with the terms and conditions of the
VERGINIA SEGOVIA, ELSA N. SAM, PEDRO M. SAM AND LINA SAM, SANTIAGO same.
MENDEZ AND MINA MENDEZ, HELEN M. BURTON AND LEONARDO BURTON, JOSE
JACINTO AND BIENVENIDA JACINTO, IMELDA DAQUIGAN, LEO MATIGA AND ALICIA SO ORDERED.3
MATIGA, FLORENCIO ACEDO JR., AND LYLA VALERIO, Respondents.
Other respondents, however, filed a Motion to Dismiss 4 dated February 4, 2013, alleging that
The Case the complaint failed to state the value of the property sought to be recovered. Moreover, they
asserted that the total selling price of all the properties is only sixteen thousand five hundred
This is a Petition for Review on Certiorari under Rule 45 assailing the April 25, 2013 Order of pesos (PhP 16,500), and the selling price or market value of a property is always higher than
the Regional Trial Court (RTC) in Civil Case No. (1798)-021 as well as its Order of July 3, 2013 its assessed value. Since Batas Pambansa Blg. (BP) 129, as amended, grants jurisdiction to
denying reconsideration. the RTCs over civil actions involving title to or possession of real property or interest therein
where the assessed value is more than PhP 20,000, then the RTC has no jurisdiction over the
The Facts complaint in question since the property which Bautista seeks to repurchase is below the PhP
20,000 jurisdictional ceiling.
Alfredo R. Bautista (Bautista), petitioner’s predecessor, inherited in 1983 a free-patent land
located in Poblacion, Lupon, Davao Oriental and covered by Original Certificate of Title (OCT) RTC Ruling5
No. (1572) P-6144. A few years later, he subdivided the property and sold it to several
vendees, herein respondents, via a notarized deed of absolute sale dated May 30, 1991. Two Acting on the motion, the RTC issued the assailed order dismissing the complaint for lack of
months later, OCT No. (1572) P-6144 was canceled and Transfer Certificates of Title (TCTs) jurisdiction. The trial court found that Bautista failed to allege in his complaint that the value of
were issued in favor of the vendees.1crallawlibrary the subject property exceeds 20 thousand pesos. Furthermore, what was only stated therein
was that the total and full refund of the purchase price of the property is PhP 16,500. This
Three years after the sale, or on August 5, 1994, Bautista filed a complaint for repurchase omission was considered by the RTC as fatal to the case considering that in real actions,
against respondents before the RTC, Branch 32, Lupon, Davao Oriental, docketed as Civil jurisdictional amount is determinative of whether it is the municipal trial court or the RTC that
Case No. 1798,2anchoring his cause of action on Section 119 of Commonwealth Act No. (CA) has jurisdiction over the case.
141, otherwise known as the “Public Land Act,” which reads:chanRoblesVirtualawlibrary
With respect to the belated filing of the motion, the RTC, citing Cosco Philippines Shipping, Inc.
v. Kemper Insurance Company,6 held that a motion to dismiss for lack of jurisdiction may be
SECTION 119. Every conveyance of land acquired under the free patent or homestead
filed at any stage of the proceedings, even on appeal, and is not lost by waiver or by estoppel.
provisions, when proper, shall be subject to repurchase by the applicant, his widow, or legal
The dispositive portion of the assailed Order reads:chanRoblesVirtualawlibrary
heirs, within a period of five years from the date of the conveyance.

Respondents, in their Answer, raised lack of cause of action, estoppel, prescription, and WHEREFORE, the complaint for Repurchase, Consignation, with Preliminary Injunction and
laches, as defenses. Damages is hereby dismissed for lack of jurisdiction.

Meanwhile, during the pendency of the case, Bautista died and was substituted by petitioner SO ORDERED.7crallawlibrary
Epifania G. Bautista (Epifania).

65
Assignment of Errors
The petition is meritorious.
Their motion for reconsideration having been denied, petitioners now seek recourse before this
Court with the following assigned errors:chanRoblesVirtualawlibrary Jurisdiction of courts is granted by the Constitution and pertinent laws.

I Jurisdiction of RTCs, as may be relevant to the instant petition, is provided in Sec. 19 of BP


129, which reads:chanRoblesVirtualawlibrary
THE PUBLIC RESPONDENT RTC ERRED IN ADMITTING THE MOTION TO DISMISS
DATED FEBRUARY 4, 2013, BELATEDLY FILED BY THE PRIVATE RESPONDENTS IN THE Sec. 19. Jurisdiction in civil cases. — Regional Trial Courts shall exercise exclusive original
CASE. jurisdiction:chanRoblesVirtualawlibrary

II 1) In all civil actions in which the subject of the litigation is incapable of pecuniary estimation;

THE PUBLIC RESPONDENT RTC ERRED IN HOLDING THAT THE INSTANT CASE FOR 2) In all civil actions which involve the title to, or possession of, real property, or any interest
REPURCHASE IS A REAL ACTION.8crallawlibrary therein, where the assessed value of the property involved exceeds Twenty thousand pesos
(P20,000.00) or, for civil actions in Metro Manila, where such value exceeds Fifty thousand
The Issue pesos (P50,000.00) except actions for forcible entry into and unlawful detainer of lands or
buildings, original jurisdiction over which is conferred upon the Metropolitan Trial Courts,
Stated differently, the issue for the Court’s resolution is: whether or not the RTC erred in Municipal Trial Courts, and Municipal Circuit Trial Courts.
granting the motion for the dismissal of the case on the ground of lack of jurisdiction over the
subject matter. On the other hand, jurisdiction of first level courts is prescribed in Sec. 33 of BP 129, which
provides:chanRoblesVirtualawlibrary
Arguments
Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit
Petitioners argue that respondents belatedly filed their Motion to Dismiss and are now Trial Courts in civil cases. — Metropolitan Trial Courts, Municipal Trial Courts, and Municipal
estopped from seeking the dismissal of the case, it having been filed nine (9) years after the Circuit Trial Courts shall exercise:chanRoblesVirtualawlibrary
filing of the complaint and after they have actively participated in the proceedings. Additionally,
they allege that an action for repurchase is not a real action, but one incapable of pecuniary 3) Exclusive original jurisdiction in all civil actions which involve title to, or possession of, real
estimation, it being founded on privity of contract between the parties. According to petitioners, property, or any interest therein where the assessed value of the property or interest therein
what they seek is the enforcement of their right to repurchase the subject property under does not exceed Twenty thousand pesos (P20,000.00) or, in civil actions in Metro Manila,
Section 119 of CA 141. where such assessed value does not exceed Fifty thousand pesos (P50,000.00) exclusive of
interest, damages of whatever kind, attorney’s fees, litigation expenses and
Respondents, for their part, maintain that since the land is no longer devoted to agriculture, the costs: Provided, That in cases of land not declared for taxation purposes, the value of such
right of repurchase under said law can no longer be availed of, citing Santana v. property shall be determined by the assessed value of the adjacent lots.
Mariñas.9 Furthermore, they suggest that petitioners intend to resell the property for a higher
profit, thus, the attempt to repurchase. This, according to respondents, goes against the policy The core issue is whether the action filed by petitioners is one involving title to or possession of
and is not in keeping with the spirit of CA 141 which is the preservation of the land gratuitously real property or any interest therein or one incapable of pecuniary estimation.
given to patentees by the State as a reward for their labor in cultivating the property. Also, the
Deed of Absolute Sale presented in evidence by Bautista was unilaterally executed by him and The course of action embodied in the complaint by the present petitioners’ predecessor,
was not signed by respondents. Lastly, respondents argue that repurchase is a real action Alfredo R. Bautista, is to enforce his right to repurchase the lots he formerly owned pursuant to
capable of pecuniary estimation. the right of a free-patent holder under Sec. 119 of CA 141 or the Public Land Act.

Our Ruling The Court rules that the complaint to redeem a land subject of a free patent is a civil action
incapable of pecuniary estimation.
66
It is a well-settled rule that jurisdiction of the court is determined by the allegations in the Republic Act No. 769117 amended Sec. 33 of BP 129 and gave Metropolitan Trial Courts,
complaint and the character of the relief sought.10 In this regard, the Court, in Russell v. Municipal Trial Courts, and Municipal Circuit Trial Courts exclusive original jurisdiction in all
Vestil,11 wrote that “in determining whether an action is one the subject matter of which is not civil actions which involve title to, or possession of, real property, or any interest therein where
capable of pecuniary estimation this Court has adopted the criterion of first ascertaining the the assessed value of the property or interest therein does not exceed twenty thousand pesos
nature of the principal action or remedy sought. If it is primarily for the recovery of a sum (PhP 20,000) or, in civil actions in Metro Manila, where such assessed value does not exceed
of money, the claim is considered capable of pecuniary estimation, and whether jurisdiction is fifty thousand pesos (PhP 50,000) exclusive of interest, damages of whatever kind, attorney’s
in the municipal courts or in the RTCs would depend on the amount of the claim.” But where fees, litigation expenses and costs.
the basic issue is something other than the right to recover a sum of money, where the money
claim is purely incidental to, or a consequence of, the principal relief sought, this Court has At first blush, it appears that the action filed by Bautista involves title to or possession of the
considered such actions as cases where the subject of the litigation may not be estimated in lots he sold to respondents. Since the total selling price is less than PhP 20,000, then the
terms of money, and, hence, are incapable of pecuniary estimation. These cases are MTC, not the RTC, has jurisdiction over the case. This proposition is incorrect for the re-
cognizable exclusively by RTCs.12crallawlibrary acquisition of the lots by Bautista or herein successors-in-interests, the present petitioners, is
but incidental to and an offshoot of the exercise of the right by the latter to redeem said lots
Settled jurisprudence considers some civil actions as incapable of pecuniary pursuant to Sec. 119 of CA 141. The reconveyance of the title to petitioners is solely
estimation, viz:chanRoblesVirtualawlibrary dependent on the exercise of such right to repurchase the lots in question and is not the
principal or main relief or remedy sought. Thus, the action of petitioners is, in reality, incapable
1. Actions for specific performance; of pecuniary estimation, and the reconveyance of the lot is merely the outcome of the
2. Actions for support which will require the determination of the civil status; performance of the obligation to return the property conformably to the express provision of CA
3. The right to support of the plaintiff; 141.
4. Those for the annulment of decisions of lower courts;
5. Those for the rescission or reformation of contracts; 13crallawlibrary Even if we treat the present action as one involving title to real property or an interest therein
6. Interpretation of a contractual stipulation.14 which falls under the jurisdiction of the first level court under Sec. 33 of BP 129, as the total
selling price is only PhP 16,000 way below the PhP 20,000 ceiling, still, the postulation of
The Court finds that the instant cause of action to redeem the land is one for specific respondents that MTC has jurisdiction will not hold water. This is because respondents have
performance. actually participated in the proceedings before the RTC and aggressively defended their
position, and by virtue of which they are already barred to question the jurisdiction of the RTC
The facts are clear that Bautista sold to respondents his lots which were covered by a free following the principle of jurisdiction by estoppel.
patent. While the deeds of sale do not explicitly contain the stipulation that the sale is subject
to repurchase by the applicant within a period of five (5) years from the date of conveyance In Heirs of Jose Fernando v. De Belen, it was held that the party raising defenses to the
pursuant to Sec. 119 of CA 141, still, such legal provision is deemed integrated and made part complaint, actively participating in the proceedings by filing pleadings, presenting his evidence,
of the deed of sale as prescribed by law. It is basic that the law is deemed written into every and invoking its authority by asking for an affirmative relief is deemed estopped from
contract.15 Although a contract is the law between the parties, the provisions of positive law questioning the jurisdiction of the court.18crallawlibrary
which regulate contracts are deemed written therein and shall limit and govern the relations
between the parties.16 Thus, it is a binding prestation in favor of Bautista which he may seek to Here, we note that aside from the belated filing of the motion to dismiss--it having been filed
enforce. That is precisely what he did. He filed a complaint to enforce his right granted by law nine (9) years from the filing of the complaint--respondents actively participated in the
to recover the lot subject of free patent. Ergo, it is clear that his action is for specific proceedings through the following acts:chanRoblesVirtualawlibrary
performance, or if not strictly such action, then it is akin or analogous to one of specific
performance. Such being the case, his action for specific performance is incapable of 1. By filing their Answer and Opposition to the Prayer for Injunction19 dated September
pecuniary estimation and cognizable by the RTC. 29, 1994 whereby they even interposed counterclaims, specifically: PhP 501,000 for
unpaid survey accounts, PhP 100,000 each as litigation expenses, PhP 200,000 and
Respondents argue that Bautista’s action is one involving title to or possession of real property PhP 3,000 per daily appearance by way of attorney’s fees, PhP 500,000 as moral
or any interests therein and since the selling price is less than PhP 20,000, then jurisdiction is damages, PhP 100,000 by way of exemplary damages, and costs of suit;
lodged with the MTC. They rely on Sec. 33 of BP 129.
67
2. By participating in Pre-trial;

3. By moving for the postponement of their presentation of evidence;20crallawlibrary

4. By presenting their witness;21 and

5. By submitting the compromise agreement for approval.22crallawlibrary

Having fully participated in all stages of the case, and even invoking the RTC’s authority by
asking for affirmative reliefs, respondents can no longer assail the jurisdiction of the said trial
court. Simply put, considering the extent of their participation in the case, they are, as they
should be, considered estopped from raising lack of jurisdiction as a ground for the dismissal of
the action.

WHEREFORE, premises considered, the instant petition is hereby GRANTED. The April 25,
2013 and July 3, 2013 Orders of the Regional Trial Court in Civil Case No. (1798)-021 are
hereby REVERSED and SET ASIDE.

The Regional Trial Court, Branch 32 in Lupon, Davao Oriental is ORDERED to proceed with
dispatch in resolving Civil Case No. (1798)-021.

No pronouncement as to costs.

SO ORDERED.

68
G.R. No. 160384. April 29, 2005 a. actual damages, as follows:
CESAR T. HILARIO, for himself and as Attorney-in-Fact of IBARRA, NESTOR, LINA and
PRESCILLA, all surnamed HILARIO vs. ALLAN T. SALVADOR a.1. transportation expenses in connection with the projected settlement of the case amounting
to P1,500.00 and for the subsequent attendance to the hearing of this case at P1,500.00 each
This is a petition for review on certiorari under Rule 45 of the Revised Rules of Court of the schedule;
Decision1 of the Court of Appeals (CA) in CA-G.R. CV No. 63737 as well as its Resolution2 denying
the motion for the reconsideration of the said decision. a.2. attorney’s fees in the amount of P20,000.00 and P500.00 for every court appearance;

The Antecedents b. moral and exemplary damages in such amount incumbent upon the Honorable Court to
determine; and
On September 3, 1996, petitioners Cesar, Ibarra, Nestor, Lina and Prescilla, all surnamed Hilario,
filed a complaint with the Regional Trial Court (RTC) of Romblon, Romblon, Branch 71, against c. such other relief and remedies just and equitable under the premises.4
private respondent Allan T. Salvador. They alleged therein, inter alia, as follows:
The private respondent filed a motion to dismiss the complaint on the ground of lack of jurisdiction
2. That, the plaintiffs are co-owners by inheritance from Concepcion Mazo Salvador of a parcel of over the nature of the action, citing Section 33 of Batas Pambansa (B.P.) Blg. 129, as amended by
land designated as Cad. Lot No. 3113-part, located at Sawang, Romblon, Romblon, which property Section 3(3) of Republic Act (R.A.) No. 7691.5 He averred that –
was [adjudged] as the hereditary share of their father, Brigido M. Hilario, Jr. when their father was
still single, and which adjudication was known by the plaintiffs[’] father’s co-heirs;
(1) the complaint failed to state the assessed value of the land in dispute;
3. That, sometime in 1989, defendant constructed his dwelling unit of mixed materials on the
(2) the complaint does not sufficiently identify and/or describe the parcel of land referred to as the
property of the plaintiffs’ father without the knowledge of the herein plaintiffs or their predecessors-
subject-matter of this action;
in-interest;

both of which are essential requisites for determining the jurisdiction of the Court where the case is
4. That, demands have been made of the defendant to vacate the premises but the latter
filed. In this case, however, the assessed value of the land in question is totally absent in the
manifested that he have (sic) asked the prior consent of their grandmother, Concepcion Mazo
Salvador; allegations of the complaint and there is nothing in the relief prayed for which can be picked-up for
determining the Court’s jurisdiction as provided by law.
5. That, to reach a possible amicable settlement, the plaintiffs brought the matter to the Lupon of
Barangay Sawang, to no avail, evidenced by the CERTIFICATE TO FILE ACTION hereto attached In the face of this predicament, it can nevertheless be surmised by reading between the lines, that
as ANNEX B; the assessed value of the land in question cannot exceed P20,000.00 and, as such, it falls within
the jurisdiction of the Municipal Trial Court of Romblon and should have been filed before said Court
rather than before the RTC. …6
6. That, the unjustified refusal of the defendant to vacate the property has caused the plaintiffs to
suffer shame, humiliation, wounded feelings, anxiety and sleepless nights;
The petitioners opposed the motion.7 They contended that the RTC had jurisdiction over the action
since the court can take judicial notice of the market value of the property in question, which
7. That, to protect their rights and interest, plaintiffs were constrained to engage the services of a was P200.00 per square meter and considering that the property was 14,797 square meters, more
lawyer.3 or less, the total value thereof is P3,500,000.00. Besides, according to the petitioners, the motion to
dismiss was premature and "the proper time to interpose it is when the [petitioners] introduced
The petitioners prayed that, after due proceedings, judgment be rendered in their favor, thus: evidence that the land is of such value."

WHEREFORE, it is prayed of this Honorable Court that after due process (sic), an order be issued On November 7, 1996, the RTC issued an Order8 denying the motion to dismiss, holding that the
for the defendant to vacate and peacefully turn over to the plaintiffs the occupied property and that action was incapable of pecuniary estimation, and therefore, cognizable by the RTC as provided in
defendant be made to pay plaintiffs: Section 19(1) of B.P. Blg. 129, as amended.

69
After the denial of the motion to dismiss, the private respondent filed his answer with THE HONORABLE COURT OF APPEALS COMMITTED GRAVE REVERSIBLE ERROR IN
counterclaim.9 Traversing the material allegations of the complaint, he contended that the HOLDING THAT THE INSTANT CASE, ACCION REINVINDICATORIA, FALLS WITHIN THE
petitioners had no cause of action against him since the property in dispute was the conjugal EXCLUSIVE ORIGINAL JURISDICTION OF THE MUNICIPAL TRIAL COURT OF ROMBLON, AND
property of his grandparents, the spouses Salustiano Salvador and Concepcion Mazo-Salvador. NOT WITH THE REGIONAL TRIAL COURT OF ROMBLON.

On April 8, 1997, Regidor and Virginia Salvador filed their Answer-in-Intervention10 making common II
cause with the private respondent. On her own motion, however, Virginia Salvador was dropped as
intervenor.11 THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS REVERSIBLE ERROR IN
ORDERING THE REFILING OF THE CASE IN THE [PROPER] COURT, INSTEAD OF DECIDING
During trial, the petitioners adduced in evidence Tax Declaration No. 8590-A showing that in 1991 THE CASE ON THE MERITS BASED ON THE COMPLETE RECORDS ELEVATED BEFORE
the property had an assessed value of P5,950.00.12 SAID APPELLATE COURT AND IN NOT AFFIRMING IN TOTO THE DECISION OF THE TRIAL
COURT.17
On June 3, 1999, the trial court rendered judgment finding in favor of the petitioners. The dispositive
portion of the decision reads: The Ruling of the Court

WHEREFORE, as prayed for, judgment is rendered: The lone issue for our resolution is whether the RTC had jurisdiction over the action of the
petitioners, the plaintiffs in the RTC, against the private respondent, who was the defendant therein.
Ordering the defendant to vacate and peacefully turn over to the plaintiffs the occupied property;
and The petitioners maintain that the RTC has jurisdiction since their action is an accion reinvindicatoria,
an action incapable of pecuniary estimation; thus, regardless of the assessed value of the subject
Dismissing defendant’s counterclaim. property, exclusive jurisdiction falls within the said court. Besides, according to the petitioners, in
their opposition to respondent’s motion to dismiss, they made mention of the increase in the
assessed value of the land in question in the amount of P3.5 million. Moreover, the petitioners
SO ORDERED.13
maintain that their action is also one for damages exceeding P20,000.00, over which the RTC has
exclusive jurisdiction under R.A. No. 7691.
Aggrieved, the private respondent and respondent-intervenor Regidor Salvador appealed the
decision to the CA, which rendered judgment on May 23, 2003 reversing the ruling of the RTC and The petition has no merit.
dismissing the complaint for want of jurisdiction. The fallo of the decision is as follows:
It bears stressing that the nature of the action and which court has original and exclusive jurisdiction
IN VIEW OF THE FOREGOING, the appealed decision is REVERSED, and the case DISMISSED, over the same is determined by the material allegations of the complaint, the type of relief prayed
without prejudice to its refilling in the proper court.
for by the plaintiff and the law in effect when the action is filed, irrespective of whether the plaintiffs
are entitled to some or all of the claims asserted therein.18 The caption of the complaint is not
SO ORDERED.14 determinative of the nature of the action. Nor does the jurisdiction of the court depend upon the
answer of the defendant or agreement of the parties or to the waiver or acquiescence of the parties.
The CA declared that the action of the petitioners was one for the recovery of ownership and
possession of real property. Absent any allegation in the complaint of the assessed value of the We do not agree with the contention of the petitioners and the ruling of the CA that the action of the
property, the Municipal Trial Court (MTC) had exclusive jurisdiction over the action, conformably to petitioners in the RTC was an accion reinvindicatoria. We find and so rule that the action of the
Section 3315 of R.A. No. 7691. petitioners was an accion publiciana, or one for the recovery of possession of the real property
subject matter thereof. An accion reinvindicatoria is a suit which has for its object the recovery of
The petitioners filed a motion for reconsideration of the said decision, which the appellate court possession over the real property as owner. It involves recovery of ownership and possession
denied.16 Hence, they filed the instant petition, with the following assignment of errors: based on the said ownership. On the other hand, an accion publiciana is one for the recovery of
possession of the right to possess. It is also referred to as an ejectment suit filed after the expiration
I of one year after the occurrence of the cause of action or from the unlawful withholding of
possession of the realty.19

70
The action of the petitioners filed on September 3, 1996 does not involve a claim of ownership over value of the property, it cannot thus be determined whether the RTC or the MTC had original and
the property. They allege that they are co-owners thereof, and as such, entitled to its possession, exclusive jurisdiction over the petitioners’ action.
and that the private respondent, who was the defendant, constructed his house thereon in 1989
without their knowledge and refused to vacate the property despite demands for him to do so. They We note that during the trial, the petitioners adduced in evidence Tax Declaration No. 8590-A,
prayed that the private respondent vacate the property and restore possession thereof to them. showing that the assessed value of the property in 1991 was P5,950.00. The petitioners, however,
did not bother to adduce in evidence the tax declaration containing the assessed value of the
When the petitioners filed their complaint on September 3, 1996, R.A. No. 7691 was already in property when they filed their complaint in 1996. Even assuming that the assessed value of the
effect. Section 33(3) of the law provides: property in 1991 was the same in 1995 or 1996, the MTC, and not the RTC had jurisdiction over the
action of the petitioners since the case involved title to or possession of real property with an
Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial assessed value of less than P20,000.00.23
Courts in Civil Cases. – Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial
Courts shall exercise: We quote with approval, in this connection, the CA’s disquisition:

(3) Exclusive original jurisdiction in all civil actions which involve title to, or possession of, real The determining jurisdictional element for the accion reinvindicatoria is, as RA 7691 discloses, the
property, or any interest therein where the assessed value of the property or interest therein does assessed value of the property in question. For properties in the provinces, the RTC has jurisdiction
not exceed Twenty Thousand Pesos (P20,000.00) or, in civil actions in Metro Manila, where such if the assessed value exceeds P20,000, and the MTC, if the value is P20,000 or below. An
assessed value does not exceed Fifty Thousand Pesos (P50,000.00) exclusive of interest, damages assessed value can have reference only to the tax rolls in the municipality where the property is
of whatever kind, attorney’s fees, litigation expenses and costs: Provided, That in cases of land not located, and is contained in the tax declaration. In the case at bench, the most recent tax
declared for taxation purposes, the value of such property shall be determined by the assessed declaration secured and presented by the plaintiffs-appellees is Exhibit B. The loose remark made
value of the adjacent lots. by them that the property was worth 3.5 million pesos, not to mention that there is absolutely no
evidence for this, is irrelevant in the light of the fact that there is an assessed value. It is the amount
Section 19(2) of the law, likewise, provides that: in the tax declaration that should be consulted and no other kind of value, and as appearing in
Exhibit B, this is P5,950. The case, therefore, falls within the exclusive original jurisdiction of the
Municipal Trial Court of Romblon which has jurisdiction over the territory where the property is
Sec. 19. Jurisdiction in civil cases. – The Regional Trial Court shall exercise exclusive original located, and not the court a quo.24
jurisdiction:
It is elementary that the tax declaration indicating the assessed value of the property enjoys the
(2) In all civil actions, which involve the title to, or possession of, real property, or any interest presumption of regularity as it has been issued by the proper government agency.25
therein, where the assessed value of the property involved exceeds Twenty Thousand Pesos
(P20,000.00) or, for civil actions in Metro Manila, where such value exceeds Fifty Thousand Pesos
(P50,000.00) except actions for forcible entry into and unlawful detainer of lands or buildings, Unavailing also is the petitioners’ argumentation that since the complaint, likewise, seeks the
original jurisdiction over which is conferred upon the Metropolitan Trial Courts, Municipal Trial recovery of damages exceeding P20,000.00, then the RTC had original jurisdiction over their
Courts, and Municipal Circuit Trial Courts. actions. Section 33(3) of B.P. Blg. 129, as amended, quoted earlier, explicitly excludes from the
determination of the jurisdictional amount the demand for "interest, damages of whatever kind,
attorney’s fees, litigation expenses, and costs." This Court issued Administrative Circular No. 09-94
The jurisdiction of the court over an action involving title to or possession of land is now setting the guidelines in the implementation of R.A. No. 7691, and paragraph 2 thereof states that –
determined by the assessed value of the said property and not the market value thereof. The
assessed value of real property is the fair market value of the real property multiplied by the
assessment level. It is synonymous to taxable value.20 The fair market value is the price at which a 2. The exclusion of the term "damages of whatever kind" in determining the jurisdictional amount
property may be sold by a seller, who is not compelled to sell, and bought by a buyer, who is not under Section 19(8) and Section 33(1) of B.P. Blg. 129, as amended by R.A. 7691, applies to cases
compelled to buy. where the damages are merely incidental to or a consequence of the main cause of action.
However, in cases where the claim for damages is the main cause of action, or one of the causes of
action, the amount of such claim shall be considered in determining the jurisdiction of the court.
Even a cursory reading of the complaint will show that it does not contain an allegation stating the
assessed value of the property subject of the complaint.21 The court cannot take judicial notice of
the assessed or market value of lands.22 Absent any allegation in the complaint of the assessed Neither may the petitioners find comfort and solace in Section 19(8) of B.P. Blg. 129, as amended,
which states:

71
SEC. 19. Jurisdiction in civil cases. – Regional Trial Courts shall exercise exclusive original
jurisdiction:

(8) In all other cases in which the demand, exclusive of interest, damages of whatever kind,
attorney's fees, litigation expenses, and costs or the value of the property in controversy exceeds
One Hundred Thousand Pesos (P100,000.00) or, in such other cases in Metro Manila, where the
demand, exclusive of the above-mentioned items exceeds Two Hundred Thousand Pesos
(P200,000.00).

The said provision is applicable only to "all other cases" other than an action involving title to, or
possession of real property in which the assessed value is the controlling factor in determining the
court’s jurisdiction. The said damages are merely incidental to, or a consequence of, the main
cause of action for recovery of possession of real property.26

Since the RTC had no jurisdiction over the action of the petitioners, all the proceedings therein,
including the decision of the RTC, are null and void. The complaint should perforce be dismissed. 27

WHEREFORE, the petition is DENIED. The assailed Decision and Resolution of the Court of
Appeals in CA-G.R. CV No. 63737 are AFFIRMED. Costs against the petitioners. SO ORDERED.

72
G.R. No. 164560 July 22, 2009 Reconsideration6 of the Decision was filed by petitioners, but was denied in an Order 7 dated July 3,
ANA DE GUIA SAN PEDRO and ALEJO DOPEÑO vs. HON. FATIMA G. ASDALA, in her 2003.
capacity as the Presiding Judge of the Regional Trial Court of Quezon City, Branch 87; HON.
MANUEL TARO, in his capacity as the Presiding Judge of the Metropolitan Trial Court of Petitioners then filed with the Court of Appeals another petition for certiorari, insisting that both the
Quezon City, Branch 42; and the HEIRS OF SPOUSES APOLONIO V. DIONISIO and MeTC and RTC acted with grave abuse of discretion amounting to lack or excess of jurisdiction by
VALERIANA DIONISIO (namely, ALLAN GEORGE R. DIONISIO and ELEANOR R. DIONISIO, not ordering the dismissal of the complaint for Accion Reivindicatoria, for lack of jurisdiction over the
herein represented by ALLAN GEORGE R. DIONISIO) same. In the assailed CA Resolution dated September 15, 2003, the CA dismissed the petition
outright, holding that certiorari was not available to petitioners as they should have availed
This resolves the petition for certiorari under Rule 65 of the Rules of Court, praying that the themselves of the remedy of appeal. Petitioners' motion for reconsideration of the resolution of
Resolutions1 of the Court of Appeals (CA) dated September 15, 2003 and June 1, 2004, dismissal was denied per Resolution8 dated June 1, 2004.
respectively, in CA-G.R. SP No. 78978, be reversed and set aside.
Thus, petitioners filed the instant petition and, in support thereof, they allege that:
The antecedent facts are as follows.
THE HONORABLE COURT OF APPEALS ACTED WITH GRAVE ABUSE OF DISCRETION
Sometime in July 2001, private respondents, heirs of spouses Apolonio and Valeriana Dionisio, filed AMOUNTING TO LACK OR IN (SIC) EXCESS OF JURISDICTION IN DENYING THE PETITION
with the Metropolitan Trial Court (MeTC) of Quezon City, Branch 42, a Complaint2 against herein FOR CERTIORARI AND FOR FAILURE TO RESOLVE THE ISSUE RAISED IN THE CERTIORARI
petitioners and Wood Crest Residents Association, Inc., for Accion Reivindicatoria, Quieting of Title REGARDING THE JURISDICTION OF THE METROPOLITAN TRIAL COURT TO TAKE
and Damages, with Prayer for Preliminary Mandatory Injunction. Private respondents alleged that COGNIZANCE OF A CASE OF ACCION REINVINDICATORIA.
subject property located in Batasan Hills, Quezon City, with an assessed value of P32,100.00, was
titled in the name of spouses Apolonio and Valeriana Dionisio; but petitioners, with malice and THE HONORABLE PUBLIC RESPONDENT FATIMA GONZALES-ASDALA, AS PRESIDING
evident bad faith, claimed that they were the owners of a parcel of land that encompasses and JUDGE OF RTC BRANCH 87, QUEZON CITY, ACTED WITH GRAVE ABUSE OF DISCRETION
covers subject property. Private respondents had allegedly been prevented from entering, AMOUNTING TO LACK OR IN EXCESS OF (SIC) JURISDICTION IN DISMISSING THE PETITION
possessing and using subject property. It was further alleged in the Complaint that petitioners' FOR CERTIORARI AND IN RESOLVING THAT A CASE OF ACCION REINVINDICATORIA IS
Transfer Certificate of Title over their alleged property was spurious. Private respondents then WITHIN THE JURISDICTION OF THE METROPOLITAN TRIAL COURT.
prayed that they be declared the sole and absolute owners of the subject property; that petitioners
be ordered to surrender possession of subject property to them; that petitioners and Wood Crest
and/or its members be ordered to pay actual and moral damages, and attorney's fees. THE HONORABLE PUBLIC RESPONDENT MANUEL TARO AS PRESIDING JUDGE MeTC,
BRANCH 42, QUEZON CITY, ACTED WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO
LACK OR IN (SIC) EXCESS OF JURISDICTION IN SO TAKING COGNIZANCE OF THE
Petitioners, for their part, filed a Motion to Dismiss3 said complaint on the ground that the MeTC had COMPLAINT FOR ACCION REINVINDICATORIA IN CIVIL CASE NO. 27434 ENTITLED, "HEIRS
no jurisdiction over the subject matter of the action, as the subject of litigation was incapable of OF SPS. APOLONIO V. DIONISIO AND VALERIANA DIONISIO, ETC. VS. ANA DE GUIA SAN
pecuniary estimation. PEDRO, ET. AL."9

The MeTC then issued an Order4 dated July 4, 2002 denying the motion to dismiss, ruling that, The present Petition for Certiorari is doomed and should not have been entertained from the very
under Batas Pambansa (B.P.) Blg. 129, as amended, the MeTC had exclusive original jurisdiction beginning.
over actions involving title to or possession of real property of small value.
The settled rule is that appeals from judgments or final orders or resolutions of the CA should be by
Petitioners' Motion for Reconsideration of said Order dated July 4, 2002 was denied. a verified petition for review on certiorari, as provided for under Rule 45 of the Revised Rules of Civil
Procedure. Thus, in Pasiona, Jr. v. Court of Appeals,10 the Court expounded as follows:
Petitioners assailed the aforementioned Order by filing a petition for certiorari with the Regional Trial
Court (RTC) of Quezon City, Branch 87. However, in its Decision5 dated March 10, 2003, the RTC The aggrieved party is proscribed from assailing a decision or final order of the CA via Rule 65,
dismissed the petition, finding no grave abuse of discretion on the part of the MeTC Presiding because such recourse is proper only if the party has no plain, speedy and adequate remedy in the
Judge. The RTC sustained the MeTC ruling, stating that, in accordance with Section 33(3) of course of law. In this case, petitioner had an adequate remedy, namely, a petition for review on
Republic Act (R.A.) No. 7691, amending B.P. Blg. 129, the MeTC had jurisdiction over the complaint certiorari under Rule 45 of the Rules of Court. A petition for review on certiorari, not a special civil
for Accion Reivindicatoria, as it involves recovery of ownership and possession of real property action for certiorari was, therefore, the correct remedy.
located in Quezon City, with an assessed value not exceeding P50,000.00. A Motion for
73
Settled is the rule that where appeal is available to the aggrieved party, the special civil action for
certiorari will not be entertained – remedies of appeal and certiorari are mutually exclusive, not
alternative or successive. Hence, certiorari is not and cannot be a substitute for a lost appeal,
especially if one's own negligence or error in one's choice of remedy occasioned such loss or lapse.
One of the requisites of certiorari is that there be no available appeal or any plain, speedy and
adequate remedy. Where an appeal was available, as in this case, certiorari will not prosper,
even if the ground therefor is grave abuse of discretion. Petitioner's resort to this Court by
Petition for Certiorari was a fatal procedural error, and the instant petition must, therefore, fail.11

For the very same reason given above, the CA, therefore, acted properly when it dismissed the
petition for certiorari outright, on the ground that petitioners should have resorted to the remedy of
appeal instead of certiorari. Verily, the present Petition for Certiorari should not have been given
due course at all.

Moreover, since the period for petitioners to file a petition for review on certiorari had lapsed by the
time the instant petition was filed, the assailed CA Resolutions have attained finality.1avvphi1

Nevertheless, just to put the matter to rest, the Court reiterates the ruling in Heirs of Valeriano S.
Concha, Sr. v. Spouses Lumocso,12 to wit:

In a number of cases, we have held that actions for reconveyance of or for cancellation of title to or
to quiet title over real property are actions that fall under the classification of cases that involve "title
to, or possession of, real property, or any interest therein."

x x x Thus, under the old law, there was no substantial effect on jurisdiction whether a case is one,
the subject matter of which was incapable of pecuniary estimation, under Section 19(1) of B.P. 129,
or one involving title to property under Section 19(2). The distinction between the two classes
became crucial with the amendment introduced by R.A. No. 7691 in 1994, which expanded the
exclusive original jurisdiction of the first level courts to include "all civil actions which involve title to,
or possession of, real property, or any interest therein where the assessed value of the property or
interest therein does not exceed Twenty thousand pesos (P20,000.00) or, in civil actions in Metro
Manila, where such assessed value does not exceed Fifty thousand pesos (P50,000.00) exclusive
of interest, damages of whatever kind, attorney's fees, litigation expenses and costs." Thus, under
the present law, original jurisdiction over cases the subject matter of which involves "title to,
possession of, real property or any interest therein" under Section 19(2) of B.P. 129 is
divided between the first and second level courts, with the assessed value of the real
property involved as the benchmark. This amendment was introduced to "unclog the overloaded
dockets of the RTCs which would result in the speedier administration of justice."13

Clearly, the RTC and the CA ruled correctly that the MeTC had jurisdiction over private respondents'
complaint for Accion Reivindicatoria.

IN VIEW OF THE FOREGOING, the petition is DISMISSED for utter lack of merit. The Resolutions
of the Court of Appeals in CA-G.R. SP No. 78978, dated September 15, 2003 and June 1, 2004, are
AFFIRMED. SO ORDERED.
74
G.R. No. 174908 June 17, 2013 of amended pleadings and additional evidence in the interest of justice. Both parties acknowledged
DARMA MASLAG vs. ELIZABETH MONZON, WILLIAM GESTON, and REGISTRY OF DEEDS receipt of the October 22, 2003 Order,11 but neither presented additional evidence before the new
OF BENGUET judge, Edgardo B. Diaz De Rivera, Jr. (Judge Diaz De Rivera).12

"It is incumbent upon x x x appellants to utilize the correct mode of appeal of the decisions of trial On May 4, 2004, Judge Diaz De Rivera issued a Resolution13 reversing the MTC Decision. The fallo
courts to the appellate courts. In the mistaken choice of their remedy, they can blame no one but reads as follows:
themselves."1
WHEREFORE, the Judgment appealed from the Municipal Trial Court of La Trinidad, Benguet is set
This is a Petition for Review on Certiorari2 of the May 31, 2006 Resolution3 of the Court of Appeals aside. [Petitioner] is ordered to turn over the possession of the 4,415 square meter land she
(CA) in CA-G.R. CV No. 83365, which dismissed petitioner Darma Maslag's (petitioner) ordinary presently occupies to [Monzon]. This case is remanded to the court a quo for further proceedings to
appeal to it for being an improper remedy. The Resolution disposed of the case as follows: determine whether [Maslag] is entitled to the remedies afforded by law to a builder in good faith for
the improvements she constructed thereon.
WHEREFORE, the Motion to Dismiss is GRANTED, and the Appeal is hereby DISMISSED.
No pronouncement as to damages and costs.
SO ORDERED.4
SO ORDERED.14
The Petition also assails the CA’s September 22, 2006 Resolution denying petitioner’s Motion for
5

Reconsideration.6 Petitioner filed a Notice of Appeal15 from the RTC’s May 4, 2004 Resolution.

Factual Antecedents Petitioner assailed the RTC’s May 4, 2004 Resolution for reversing the MTC’s factual findings 16 and
prayed that the MTC Decision be adopted. Her prayer before the CA reads:
In 1998, petitioner filed a Complaint7 for reconveyance of real property with declaration of nullity of
original certificate of title (OCT) against respondents Elizabeth Monzon (Monzon), William Geston WHEREFORE, premises considered, it is most respectfully prayed that the decision of the Regional
and the Registry of Deeds of La Trinidad, Benguet. The Complaint was filed before the Municipal Trial Court, Branch 10 of La Trinidad, Benguet, appealed from be reversed in toto and that the
Trial Court (MTC) of La Trinidad, Benguet. Honorable Court adopt the decision of the Municipal Trial Court. Further reliefs just and equitable
under the premises are prayed for.17
After trial, the MTC found respondent Monzon guilty of fraud in obtaining an OCT over petitioner’s
property.8 It ordered her to reconvey the said property to petitioner, and to pay damages and costs Respondents moved to dismiss petitioner’s ordinary appeal for being the improper remedy. They
of suit.9 asserted that the proper mode of appeal is a Petition for Review under Rule 42 because the RTC
rendered its May 4, 2004 Resolution in its appellate jurisdiction.18
Respondents appealed to the Regional Trial Court (RTC) of La Trinidad, Benguet.
Ruling of the Court of Appeals
After going over the MTC records and the parties’ respective memoranda, the RTC of La Trinidad,
Benguet, Branch 10, through Acting Presiding Judge Fernando P. Cabato (Judge Cabato), issued The CA dismissed petitioner’s appeal. It observed that the RTC’s May 4, 2004 Resolution (the
its October 22, 2003 Order,10 declaring the MTC without jurisdiction over petitioner’s cause of subject matter of the appeal before the CA) set aside an MTC Judgment; hence, the proper remedy
action. It further held that it will take cognizance of the case pursuant to Section 8, Rule 40 of the is a Petition for Review under Rule 42, and not an ordinary appeal.19
Rules of Court, which reads:
Petitioner sought reconsideration.20 She argued, for the first time, that the RTC rendered its May 4,
SECTION 8. Appeal from orders dismissing case without trial; lack of jurisdiction. – x x x 2004 Resolution in its original jurisdiction. She cited the earlier October 22, 2003 Order of the RTC
declaring the MTC without jurisdiction over the case.
If the case was tried on the merits by the lower court without jurisdiction over the subject matter, the
Regional Trial Court on appeal shall not dismiss the case if it has original jurisdiction thereof, but The CA denied petitioner’s Motion for Reconsideration in its September 22, 2006 Resolution: 21
shall decide the case in accordance with the preceding section, without prejudice to the admission
75
A perusal of the May 4, 2004 Resolution of the RTC, which is the subject matter of the appeal, In her Complaint26 for reconveyance of real property with declaration of nullity of OCT, petitioner
clearly reveals that it took cognizance of the MTC case in the exercise of its appellate jurisdiction. claimed that she and her father had been in open, continuous, notorious and exclusive possession
Consequently, as We have previously enunciated, the proper remedy, is a petition for review under of the disputed property since the 1940’s. She averred:
Rule 42 and not an ordinary appeal under Rule 41.
7. Sometime in the year 1987, Elizabeth Monzon, the owner of the adjacent parcel of land
WHEREFORE, premises considered, the instant Motion for Reconsideration is DENIED. The May being occupied by plaintiff [Maslag], informed the plaintiff that the respective parcels of land
31, 2006 Resolution of this Court is hereby AFFIRMED in toto. being claimed by them can now be titled. A suggestion was, thereafter made, that those
who were interested to have their lands titled, will contribute to a common fund for the
SO ORDERED.22 surveying and subsequent titling of the land;

Hence this Petition wherein petitioner prays that the CA be ordered to take cognizance of her 8. Since plaintiff had, for so long, yearned for a title to the land she occupies, she
appeal.23 contributed to the amount being requested by Elizabeth Monzon;

Issues 9. A subdivision survey was made and in the survey, the respective areas of the plaintiff
and the defendants were defined and delimited – all for purposes of titling. x x x
Petitioner set forth the following issues in her Petition:
10. But alas, despite the assurance of subdivided titles, when the title was finally issued by
the Registry of Deeds, the same was only in the name of Elizabeth Monzon and WILLIAM
WHETHER X X X THE COURT OF APPEALS WAS CORRECT IN DISMISSING THE APPEAL
GESTON. The name of Darma Maslag was fraudulently, deliberately and in bad faith
FILED BY THE PETITIONER, CONSIDERING THAT THE REGIONAL TRIAL COURT, BRANCH
omitted. Thus, the title to the property, to the extent of 18,295 square meters, was titled
10 OF LA TRINIDAD, BENGUET HELD THAT THE ORIGINAL COMPLAINT AS FILED BEFORE solely in the name of ELIZABETH MONZON.
THE MUNICIPAL TRIAL COURT OF LA TRINIDAD, BENGUET WAS DECIDED BY THE LATTER
WITHOUT ANY JURISDICTION AND, IN ORDERING THAT THE CASE SHALL BE DECIDED
PURSUANT TO THE PROVISION OF SECTION 8 OF RULE 40 OF THE RULES OF COURT, IT As a relief, petitioner prayed that Monzon be ordered to reconvey the portion of the property which
DECIDED THE CASE NOT ON ITS APPELLATE JURISDICTION BUT ON ITS ORIGINAL she claimed was fraudulently included in Monzon’s title. Her primary relief was to recover ownership
JURISDICTION WHAT WILL BE THE EFFECT OF THE DECISION OF THE REGIONAL TRIAL of real property. Indubitably, petitioner’s complaint involves title to real property. An action "involving
COURT, BRANCH 10 OF LA TRINIDAD, BENGUET, WHEN IT DECIDED A CASE APPEALED title to real property," on the other hand, was defined as an action where "the plaintiff’s cause of
BEFORE IT UNDER THE PROVISION OF SECTION 8, RULE 40 OF THE RULES OF COURT OF action is based on a claim that she owns such property or that she has the legal rights to have
THE PHILIPPINES, AS TO THE COURSE OF REMEDY THAT MAY BE AVAILED OF BY THE exclusive control, possession, enjoyment, or disposition of the same."27
PETITIONER – A PETITION FOR REVIEWUNDER RULE 42 OR AN ORDINARY APPEAL UNDER
RULE 41.24 Under the present state of the law, in cases involving title to real property, original and exclusive
jurisdiction belongs to either the RTC or the MTC, depending on the assessed value of the subject
Our Ruling property.28 Pertinent provisions of Batas Pambansa Blg. (BP) 129, 29 as amended by Republic Act
(RA) No. 7691,30 provides:
In its October 22, 2003 Order, the RTC declared that the MTC has no jurisdiction over the subject
matter of the case based on the supposition that the same is incapable of pecuniary estimation. Sec. 19. Jurisdiction in civil cases. – Regional Trial Courts shall exercise exclusive original
Thus, following Section 8, Rule 40 of the Rules of Court, it took cognizance of the case and directed jurisdiction:
the parties to adduce further evidence if they so desire. The parties bowed to this ruling of the RTC
and, eventually, submitted the case for its decision after they had submitted their respective (1) In all civil actions in which the subject of the litigation is incapable of pecuniary
memoranda. estimation;

We cannot, however, gloss over this jurisdictional faux pas of the RTC. Since it involves a question (2) In all civil actions which involve the title to, or possession of, real property, or any
of jurisdiction, we may motu proprio review and pass upon the same even at this late stage of the interest therein, where the assessed value of the property involved exceeds Twenty
proceedings.25 thousand pesos (P20,000.00) or for civil actions in Metro Manila, where x x x the assessed
value of the property exceeds Fifty thousand pesos ([P]50,000.00) except actions for
76
forcible entry into and unlawful detainer of lands or buildings, original jurisdiction over which Judge who penned the May 4, 2004 Resolution, Judge Diaz de Rivera, actually treated the case as
is conferred upon Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit an appeal despite the October 22, 2003 Order. He started his Resolution by stating, "This is an
Trial Courts; appeal from the Judgment rendered by the Municipal Trial Court (MTC) of La Trinidad
Benguet"35 and then proceeded to discuss the merits of the "appeal." In the dispositive portion of
SEC. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial said Resolution, he reversed the MTC’s findings and conclusions and remanded residual issues for
Courts in Civil Cases. — Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial trial with the MTC. Thus, in fact and in law, the RTC Resolution was a continuation of the
Courts shall exercise: proceedings that originated from the MTC. It was a judgment issued by the RTC in the exercise of
its appellate jurisdiction. With regard to the RTC’s earlier October 22, 2003 Order, the same should
be disregarded for it produces no effect (other than to confuse the parties whether the RTC was
(3) Exclusive original jurisdiction in all civil actions which involve title to, or possession of, real invested with original or appellate jurisdiction). It cannot be overemphasized that jurisdiction over
property, or any interest therein where the assessed value of the property or interest therein does the subject matter is conferred only by law and it is "not within the courts, let alone the parties, to
not exceed Twenty thousand pesos (P20,000.00) or, in civil actions in Metro Manila, where such themselves determine or conveniently set aside."37 Neither would the active participation of the
assessed value does not exceed Fifty thousand pesos (P50,000.00) x x x.
parties nor estoppel operate to confer original and exclusive jurisdiction where the court or tribunal
only wields appellate jurisdiction over the case.38 Thus, the CA is correct in holding that the proper
In the case at bench, annexed to the Complaint is a Declaration of Real Property 31 dated November mode of appeal should have been a Petition for Review under Rule 42 of the Rules of Court, and
12, 1991, which was later marked as petitioner’s Exhibit "A",32 showing that the disputed property not an ordinary appeal under Rule 41.
has an assessed value of P12,40033 only. Such assessed value of the property is well within the
jurisdiction of the MTC. In fine, the RTC, thru Judge Cabato, erred in applying Section 19(1) of BP
Seeing the futility of arguing against what the RTC actually did, petitioner resorts to arguing for what
129 in determining which court has jurisdiction over the case and in pronouncing that the MTC is
the RTC should have done. She maintains that the RTC should have issued its May 4, 2004
divested of original and exclusive jurisdiction.
Resolution in its original jurisdiction because it had earlier ruled that the MTC had no jurisdiction
over the cause of action.
This brings to fore the next issue of whether the CA was correct in dismissing petitioner’s appeal.
Petitioner’s argument lacks merit. To reiterate, only statutes can confer jurisdiction. Court issuances
Section 2, Rule 50 of the Rules of Court provides for the dismissal of an improper appeal: cannot seize or appropriate jurisdiction. It has been repeatedly held that "any judgment, order or
resolution issued without jurisdiction is void and cannot be given any effect." 39 By parity of
SECTION 2. Dismissal of improper appeal to the Court of Appeals. – An appeal under Rule 41 reasoning, an order issued by a court declaring that it has original and exclusive jurisdiction over the
taken from the Regional Trial Court to the Court of Appeals raising only questions of law shall be subject matter of the case when under the law it has none cannot likewise be given effect. It
dismissed, issues purely of law not being reviewable by said court. Similarly, an appeal by notice of amounts to usurpation of jurisdiction which cannot be countenanced. Since BP 129 already
appeal instead of by petition for review from the appellate judgment of a Regional Trial Court shall apportioned the jurisdiction of the MTC and the RTC in cases involving title to property, neither the
be dismissed. courts nor the petitioner could alter or disregard the same. Besides, in determining the proper mode
of appeal from an RTC Decision or Resolution, the determinative factor is the type of jurisdiction
An appeal erroneously taken to the Court of Appeals shall not be transferred to the appropriate actually exercised by the RTC in rendering its Decision or Resolution. Was it rendered by the RTC
court but shall be dismissed outright.1âwphi1 (Emphasis supplied) in the exercise of its original jurisdiction, or in the exercise of its appellate jurisdiction? In short, we
look at what type of jurisdiction was actually exercised by the RTC. We do not look into what type of
jurisdiction the RTC should have exercised. This is but logical. Inquiring into what the RTC should
There are two modes of appealing an RTC decision or resolution on issues of fact and law. 34 The have done in disposing of the case is a question which already involves the merits of the appeal, but
first mode is an ordinary appeal under Rule 41 in cases where the RTC exercised its original we obviously cannot go into that where the mode of appeal was improper to begin with.
jurisdiction. It is done by filing a Notice of Appeal with the RTC. The second mode is a petition for
review under Rule 42 in cases where the RTC exercised its appellate jurisdiction over MTC
decisions. It is done by filing a Petition for Review with the CA. Simply put, the distinction between WHEREFORE, premises considered, the Petition for Review is DENIED for lack of merit. The
these two modes of appeal lies in the type of jurisdiction exercised by the RTC in the Order or assailed May 31, 2006 and September 22, 2006 Resolutions of the Court of Appeals in CA-G.R. CV
Decision being appealed. No. 83365 are AFFIRMED. SO ORDERED.

As discussed above, the MTC has original and exclusive jurisdiction over the subject matter of the
case; hence, there is no other way the RTC could have taken cognizance of the case and review
the court a quo’s Judgment except in the exercise of its appellate jurisdiction. Besides, the new RTC
77
G.R. No. 131755 October 25, 1999 Pesos (P150,000.00), Philippine Currency, exclusive of the damages under paragraphs (1),
MOVERS-BASECO INTEGRATED PORT SERVICES vs. CYBORG LEASING CORP (2), and (3) stated supra.

The instant matter has been brought to this Court via a petition for review under Rule 45 of the Plaintiff further prays for other equitable reliefs and remedies. 1
Rules of Court to seek a reversal of the decision of the decision of the Regional Trial Court ("RTC")
of Manila, Branch 16, in Civil Case No. 97-85267.1âwphi1.nêt Upon application of Cyborg, a writ of replevin was issued following the filing of a P300,000.00
replevin bond. The directive was contained in the court's order of 27 August 1996, viz:
Cyborg Leasing Corporation ("Cyborg"), herein private respondent, filed on 22 August 1996 before
the Metropolitan Trial Court ("MTC") of Manila a case, captioned "Damages with Prayer for a Writ of WHEREFORE, pursuant to Sections 1 to 3, Rule 60 of the Revised Rules of Court, a Writ
Replevin" (Civil Case No. 152839), against Conpac Warehousing, Inc. ("Conpac"), and herein of Replevin is hereby ordered issued requiring the Sheriff of this Court to fortwith take
petitioner Movers-Baseco Integrated Port Services ("Movers"). The complaint alleged that pursuant possession of the property specified on the face of this Order after serving a copy of this
to a lease agreement, Cyborg had delivered one (1) NISSAN forklift to CONPAC. The lease Order to defendants, together with a copy of the application, affidavit, and bond.
agreement stipulated a monthly rental of P11,000.00 for the use of the equipment from its date of Accordingly, the Sheriff of this Court is hereby required to comply with Sections 4 to 8 of
delivery. Conpac supposedly failed and refused to pay the stipulated rentals starting April 1995 Rule 60.
notwithstanding demands therefor. Sometime in May 1995, petitioner took control of the operations
of Conpac and seized all cargoes and equipment including the subject forklift. Petitioner ignored
IT IS SO ORDERED. 2
Cyborg's demand for the return to it of the equipment and the formal disclaimer of ownership made
by CONPAC. In its Complaint, Cyborg prayed:
On 06 February 1997, petitioner was served with a copy of the summons and the writ of replevin.
UPON RECEIPT AND BEFORE ANSWER On 14 February 1997, petitioner filed a motion to dismiss the case on the ground of lack of
jurisdiction on the part of the MTC since the complaint had asked for, among other things, the
following:
That an ORDER be issued directing the Sheriff or other officer of this Court to forthwith take
custody and possession of the subject equipment and to dispose it in accordance with the
Rules of Court. (a) . . . actual market value of the equipment (par. 8 of the complaint) — P150,000.00

AFTER TRIAL (b) . . . actual damages for use of the equipment at the rate of P11,000.00 monthly from 09
April 1995 up to the time possession was taken by the plaintiff under the order of the
Honorable Court (par, 9(a) of the complaint) 242,000.00
That judgment be rendered for the plaintiff ordering the defendants, jointly and severally, to
pay the following amounts:
(c) exemplary damages 1,000,000.00
(1) P11,000.00 per month as actual damages by way of reasonable compensation for the
(d) attorney's fees 50,000.00
use, enjoyment and/or rental of the subject equipment from April 9, 1995 until it is
repossessed by the plaintiff;
Total P1,442,000.00
(2) P1,000.000.00 as exemplary damages and
On 18 March 1997, the MTC issued an order dismissing the complaint for lack of jurisdiction, and
ratiocinating, thus —
(3) P50,000.00 as attorney's fees and costs.

IN THE ALTERNATIVE It is a fundamental axiom in adjective law that jurisdiction is conferred by law, and where
there is none, no agreement of the parties can vest competencia (Leonor vs. Court of
Appeals, 256 SCRA 69; (1996); Department of Health vs. National Labor Commission, 251
In the event that the subject equipment could not be seized, that defendants be jointly and SCRA 700; 707 (1995); 1 Regalado, Remedial Law Compendium, 1988 5th rev. ed., p. 9).
severally ordered to pay the plaintiff its actual market value of One Hundred Fifty Thousand

78
Albeit the subject equipment has a market value of P150,000.00 (paragraph 8, Complaint) 85267). This petition was opposed by Movers as being tardily filed. Still, later, an answer to this
and while it is true that interest, damages of whatever kind, attorney's fees, litigation petition was filed by Movers.
expenses and costs are excluded in ascertaining jurisdiction per Section 3 of Republic Act
No. 7691 and are considered only to determine the filing fees, it is equally true that if the On 20 October 1997, the RTC issued an order granting Cyborg's application for preliminary
principal request in the complaint is for damages, or one of the causes of action, the injunction; the court said:
amount of such claim shall be determinative of competencia under Supreme Court Circular
No. 09-94 dated June 14, 1994.
The MTC dismissed the complaint filed by petitioner Cyborg for replevin of a leased Nissan
forklift by defendant Compac and later taken into custody by defendant Movers-Baseco.
The amount sought to be recovered is the "amount of the demand" (Oteng vs. Tan Upon the MTC's denial of Cyborg's motion for reconsideration, Cyborg caused the filing of
Kiem, Ta, 61 Phil. 87) and included in the computation of the jurisdictional amount are the instant petition.
attorney's fees recoverable as damages (Article 2208, New Civil Code), consequential
damages, exemplary damages if the amount thereof is specified in the complaint (Enerio
In its motion to dismiss before the MTC Manila, Movers-Baseco argued that the MTC had
vs. Alampay, 64 SCRA 142, and moral damages, if quantified in the complaint (Quiason,
Philippines Courts and their Jurisdictions, 1986 ed., pp. 166-168). no jurisdiction over this case because while the alleged amount of the forklift is P150,000,
together with the other amounts/damages claimed, the total is beyond the MTC's
jurisdiction.
Hence, on the basis of the clarification of the Supreme Court, the total claims of the plaintiff
are beyond the purview of this Court's jurisdiction.
Cyborg argued that since the principal action is for replevin, the other amounts being
merely incidental, as the amount of P150,000 is within the MTC jurisdiction, the latter is
Accordingly, Civil Case No. 152839 is hereby DISMISSED for lack of jurisdiction as prayed competent to take cognizance of the case.
for. 3
Such arguments, however, are better reserved for the adjudication on the merits of this
The MTC, in its order of 10 June 1997, denied Cyborg's motion for reconsideration, elaborating that petition. The issue now is whether there is sufficient legal ground to issue a writ of
it — preliminary injunction to enjoin enforcement of the MTC's order dated June 10, 1997 which
directed the delivery of the replevied forklift back to Movers-Baseco.
. . . is not unaware of Justice Regalado's discourse in his treatise that "replevin is available
only where the principal relief sought in the action is the recovery of personal property, the The MTC complaint alleged that the rentals of P11,000 per month are not being paid in the
other reliefs, like damages, being merely incidental thereto" (1 Regalado, Remedial Law interim which lease contract is dated January 5, 1995 (Record, page 35).
Compendium, 1988 5th rev. ed., p. 437) which was utilized by plaintiffs counsel to secure
re-evaluation of the challenged Order (page 2, Additional Arguments Relative to the Motion
It appears that Cyborg is the lessor-owner of the forklift. In the meantime, the rentals are
for Reconsideration). Yet, this Court cannot also ignore the language of Supreme Court
not being paid it. As owner of the same, Cyborg has a clear right to the possession of the
Administrative Circular No. 09-94 dated June 14, 1994 that if the principal supplication is for
same during the pendency of this proceedings, the MTC having already issued a writ of
damages, or is one of the causes of action, like in this case, the amount of such claim will
replevin to gain possession of the forklift which is now in the possession of Cyborg.
spell the difference in jurisdiction between the Metropolitan Trial Court and the Regional
Trial Court. This status quo existing at the time this petition was filed should be maintained pending the
resolution of the case, otherwise, great damage will be caused to Cyborg, the owner.
WHEREFORE, the plaintiff's Motion for Reconsideration and plaintiffs additional arguments
The 1997 Rules on Civil Procedure allow the ex parte issuance of a 20-day TRO, the Rules
relative to the motion for reconsideration are hereby DENIED. Accordingly, as prayed for by
silent as to whether a bond should cover the 20-day TRO, as it is the writ of preliminary
defendant's counsel on May 27, 1997, Sheriff Abulencia is hereby directed to RETURN the
injunction that requires the filing of an injunction bond. Hence, this Court issued a TRO until
Nissan Forklift described as Equipment No. C-201, 2 Tonner, Engine No. G1-214511 FG
25 TCM to defendant Movers-Baseco Integrated Port Services, Inc. 4 October 22, 1997 (Rule 58, Section 5), otherwise, with the rentals in the interim being
unpaid, Cyborg is destined to suffer GREAT damage (not necessarily irreparable), the Rule
expressly mentioning great OR irreparable injury.1âwphi1.nêt
Cyborg did not succeed in its motion for clarificatory judgment which the court took as just a second
motion for reconsideration. Then, on 26 September 1997, Cyborg filed a petition for certiorari and
WHEREFORE, PREMISES CONSIDERED, let a writ of preliminary injunction issue against
prohibition, with preliminary injunction and/or prayer for temporary restraining order, against the
the respondents. The public and private respondents, the sheriff concerned, and any
MTC Judge, Conpac Warehousing and Movers, before the RTC of Manila (Civil Case No. 97-
79
person acting for and in their behalf are restrained from implementing the order of the MTC (2) the MTC's order of dismissal had become final and executory;
Manila dated June 10, 1997 directing the delivery of the forklift back to the private
respondent Movers-Baseco until the Court resolves the petition with finality. (3) Cyborg's special civil action of certiorari and prohibition before the RTC can be a substitute for a
lost appeal; and
Serve a copy of this order, together with a copy of the affidavit, upon the public and private
respondents. No additional injunction bond is being required because Cyborg already filed (4) a temporary restraining order or preliminary writ of injunction can be issued without an injunction
an injunction bond before the MTC Manila. 5 bond apart from the replevin bond.

Feeling aggrieved, petitioner filed before the RTC on 24 October 1997 this manifestation: The threshold issue concerns MTC's jurisdiction over the action filed by Cyborg in Civil Case No.
152839 for "Damages with prayer for a writ of replevin." Hardly disputable is that the jurisdiction of
For accuracy, respondent Movers-Baseco would like to state that: the court and the nature of the action must be determined by the averments in the complaint and
the character of the relief sought 8 vis-a-visthe corresponding provisions of the law involved. 9
(a) respondent Movers-Baseco never took custody of the forklift after the respondent
Sheriff took possession of the same pursuant to the writ of replevin issued by the MTC; and Sec. 33 of Batas Pambansa Blg. 129, as amended by Republic Act No. 7691, states:

(b) moreover, there is no bond posted by the petitioner for the issuance of the injunction. Sec. 33. Jurisdiction of Metropolitan Trial Courts; Municipal Trial Courts and Municipal
The bond referred to by this Court is the replevin bond posted in the Metropolitan Trial Circuit Trial Courts in Civil Cases. — Metropolitan Trial Courts, Municipal Trial Courts, and
Court. 6 Municipal Circuit Trial Courts shall exercise:

Ultimately, on 04 December 1997, the RTC promulgated its judgment in Civil Case No. 97-85267; (1) Exclusive original jurisdiction over civil actions and probate proceedings testate and
resolving the merits of the petition, it concluded: intestate, including the grant of provisional remedies in proper cases, where the value of
the personal property, estate, or amount of the demand does not exceed, or amount of the
WHEREFORE, PREMISES CONSIDERED, the petition for certiorari is hereby GRANTED. demand does not exceed One hundred thousand pesos (P100,000.00) or, in Metro Manila
Consequently, where such personal property, estate, or amount of the demand does not exceed Two
hundred thousand pesos (P200,000.00), exclusive of interest, damages of whatever kind,
attorney's fees, litigation expenses, and costs, the amount of which must be specifically
1. Having been rendered with grave abuse of discretion, the orders of
alleged: Provided, That interest, damages of whatever kind, attorney's fees, litigation
respondent judge dated March 18, (Annex A), June 10, 1997 (Annex B),
expenses, and costs shall be included in the determination of the filing
and August 22, 1997 (Annex C) are hereby ANNULLED and SET ASIDE.
fees: Provided,further, That where there are several claims or causes of actions between
the same or different parties, embodied in the same complaint, the amount of the demand
2. Respondent judge is ordered to refrain from implementing his order shall be the totality of the claims in all the causes of action, irrespective of whether the
dated June 10, 1997 for the delivery of the forklift to respondent causes of action arose out of the same or different transactions;
MOVERS-BASECO, making the writ of injunction permanent.
Supreme Court Administrative Circular No. 09-94, in turn, provides:
3. Remanding the case to the MTC Manila for trial on the merits.
SUBJECT: Guidelines in the Implementation of the Republic Act No. 7691, Entitled "An Act
Let a certified copy of this judgment be served upon the public respondent MTC Manila Expanding the Jurisdiction of the Metropolitan Trial Courts, Municipal Trial Courts and
judge. Serve likewise a copy of this judgment upon the respondent Sheriff, counsel for Municipal Circuit Trial Courts, Amending For the Purpose Batas Pambansa Blg. 129,
petitioner, counsel for CONPAC, and counsel for MOVERS-BASECO. 7 otherwise Known As the Judiciary Reorganization Act of 1980."

Petitioner timely resorted to this Court, via the instant petition for review, assailing the decision of xxx xxx xxx
the RTC and submitting to the Court the following legal issues: Whether or not —
2. the exclusion of the term "damages" of whatever kind in determining the jurisdictional
(1) the MTC had jurisdiction over respondent's complaint; amount under Section 19(8) and Section 33(1) of B.P. Blg. 129, as amended by R.A. No.
80
7691, applies to cases where the damages are merely incidental to or a consequence of
the main cause of action. However, in cases where the claim for damages is the main
cause of action, or one of the causes of action, the amount of such claim shall be
considered in determining the jurisdiction of the court.

The complaint filed by Cyborg with the Metropolitan Trial Court of Manila prayed for the return of the
Nissan Forklift to it, as owner and as lessor pursuant to a lease agreement executed by it in favor of
Conpac, or, in the alternative for the payment of P150,000.00 (the actual market value of the
forklift), plus damages, plus the amount of unpaid lease, starting 09 April 1995 at P11,000.00 per
month, which as of the time of the filing of the complaint on 22 August 1996 had amounted to
P180,000.00 which, together with the value of the forklift, reach the sum of P230,000.00 excluding
the amount of damages and attorney's fees likewise claimed. It would be incorrect to argue that the
actual damages in the form of unpaid rentals were just incident of the action for the return of the
forklift, considering that private respondent specifically sought in the complaint not only the seizure
of the forklift from petitioner-Movers, which took control of the operations of Conpac, but likewise the
payment of unpaid and outstanding rentals. Verily, the Metropolitan Trial Court's orders of 18 March
1997 and 10 June 1997 dismissing the complaint and denying the motion of private respondent,
respectively, were properly decreed.

Another set back for Cyborg's cause was the fact that its petition for certiorari, with preliminary
injunction and prayer for temporary restraining order, filed before the RTC should not have been
allowed not only for being late but also for not being a valid substitute for a lost appeal. A petition
for certiorari under the 1997 Rules of Civil Procedure should be filed within 60 days from receipt of
the assailed decision, order or resolution. Cyborg's petition with the RTC was filed fourteen (14)
days late 10 on 26 September 1997, or on the 74th day from its receipt of the order denying the
motion for reconsideration on 14 July 1997. The RTC acted on the mistaken notion that the 1997
Rules of Civil Procedure took effect only in October 1997; in fact, the new rules became operative
since 01 July 1997.

Having thus concluded, the Court need not take up the other issues raised.

WHEREFORE, the petition for review is GRANTED, and the decision of the Regional Trial Court of
Manila in Civil Case No. 97-85267 is ANNULLED and SET ASIDE. The orders dated 18 March
1997, 10 June 1997 and 22 August 1997 of the Metropolitan Trial Court of Manila in Civil Case No.
152839 for "Damages With Prayer for a Writ of Replevin" are reinstated. Civil Case No. 152839 for
damages is ordered DISMISSED for lack of jurisdiction.1âwphi1.nêt

SO ORDERED.

81
G.R. No. 143951 October 25, 2005 2. The exclusion of the term "damages of whatever kind in determining the jurisdictional amount
Norma Mangaliag and Narciso Solano vs. Hon. Edelwina Catubig-Pastoral, Judge of the under Section 19 (8) and Section 33 (1) of B.P. Blg. 129, as amended by R.A. No. 7691, applied to
Regional Trial Court, 1st Judicial Region, San Carlos City, (Pangasinan), Branch 56 and cases where the damages are merely incidental to or a consequence of the main cause of action.
Apolinario Serquina, Jr However, in cases where the claim for damages is the main cause of action, or one of the causes of
action, the amount of such claim shall be considered in determining the jurisdiction of the court.
Before us is a petition for certiorari, with a prayer for the issuance of a temporary restraining order,
to set aside the Order dated April 17, 2000 of the Regional Trial Court (RTC), Branch 56, San The respondent RTC Judge also cited the 1999 case of Ong vs. Court of Appeals,7 where an action
Carlos City in Civil Case No. SCC-2240, which denied petitioners’ motion to dismiss; and the Order for damages due to a vehicular accident, with prayer for actual damages of P10,000.00 and moral
dated June 13, 2000, which denied petitioners’ motion for reconsideration. damages of P1,000,000.00, was tried in a RTC.

The factual background of the case is as follows: On May 19, 2000, petitioners filed a motion for reconsideration 8 but it was denied by the respondent
RTC Judge in her second assailed Order, dated June 13, 2000.9
On May 10, 1999, private respondent Apolinario Serquina, Jr. filed before the RTC a complaint for
damages against petitioners Norma Mangaliag and Narciso Solano. The complaint alleges that: on Hence, the present petition for certiorari, with prayer for the issuance of a temporary restraining
January 21, 1999, from 9:00 to 10:00 a.m., private respondent, together with Marco de Leon, Abner order.10
Mandapat and Manuel de Guzman, was on board a tricycle driven by Jayson Laforte; while in
Pagal, San Carlos City, a dump truck owned by petitioner Mangaliag and driven by her employee, On August 9, 2000, the Court resolved to issue the temporary restraining order prayed for by
petitioner Solano, coming from the opposite direction, tried to overtake and bypass a tricycle in front petitioners. Consequently, the respondent RTC Judge desisted from hearing further Civil Case No.
of it and thereby encroached the left lane and sideswiped the tricycle ridden by private respondent; SCC-2240.11
due to the gross negligence, carelessness and imprudence of petitioner Solano in driving the truck,
private respondent and his co-passengers sustained serious injuries and permanent deformities;
Petitioners propound this issue for consideration: In an action for recovery of damages, does the
petitioner Mangaliag failed to exercise due diligence required by law in the selection and supervision
amount of actual damages prayed for in the complaint provide the sole test for determining the
of her employee; private respondent was hospitalized and spent P71,392.00 as medical expenses;
court’s jurisdiction, or is the total amount of all the damages claimed, regardless of kind and nature,
private respondent sustained a permanent facial deformity due to a fractured nose and suffers from
such as moral, exemplary, nominal damages, and attorney’s fees, etc., to be computed collectively
severe depression as a result thereof, for which he should be compensated in the amount
with the actual damages to determine what court – whether the MTC or the RTC – has jurisdiction
of P500,000.00 by way of moral damages; as a further result of his hospitalization, private
over the action?
respondent lost income of P25,000.00; private respondent engaged the services of counsel on a
contingent basis equal to 25% of the total award.1
Petitioners maintain that the court’s jurisdiction should be based exclusively on the amount of actual
damages, excluding therefrom the amounts claimed as moral, exemplary, nominal damages and
On July 21, 1999, petitioners filed their answer with counterclaim denying that private respondent
attorney’s fee, etc. They submit that the specification in Administrative Circular No. 09-94 that "in
has a cause of action against them. They attributed fault or negligence in the vehicular accident on
the tricycle driver, Jayson Laforte, who was allegedly driving without license.2 cases where the claim for damages is the main cause of action. . . the amount of such claim shall
be considered in determining the jurisdiction of the court"signifies that the court’s jurisdiction must
be tested solely by the amount of that damage which is principally and primarily demanded, and not
Following pre-trial conference, trial on the merits ensued. When private respondent rested his case, the totality of all the damages sought to be recovered.
petitioner Solano testified in his defense.
Petitioners insist that private respondent’s claim for actual damages in the amount of P71,392.00 is
Subsequently, on March 8, 2000, petitioners, assisted by a new counsel, filed a motion to dismiss the principal and primary demand, the same being the direct result of the alleged negligence of
on the ground of lack of jurisdiction over the subject matter of the claim, alleging that the Municipal petitioners, while the moral damages for P500,000.00 and attorney’s fee, being the consequent
Trial Court (MTC) has jurisdiction over the case since the principal amount prayed for, in the amount effects thereof, may prosper only upon a prior finding by the court of the existence of petitioners’
of P71,392.00, falls within its jurisdiction.3Private respondent opposed petitioners’ motion to negligence that caused the actual damages. Considering that the amount of actual damages
dismiss.4 On March 24, 2000, petitioners filed a supplement in support of their motion to dismiss. 5 claimed by private respondent in Civil Case No. SCC-2240 does not exceed P200,000.00, which
was then the jurisdictional amount of the MTC, the jurisdiction over the case clearly pertains to the
On April 17, 2000, the respondent RTC Judge, Edelwina Catubig-Pastoral, issued the first assailed MTC, and not to the RTC. Therefore, the RTC should have dismissed the case for lack of
Order denying petitioners’ motion to dismiss,6 relying upon the mandate of Administrative Circular jurisdiction. Petitioners cite as relevant the case of Movers-Baseco Integrated Port Services, Inc. vs.
No. 09-94, paragraph 2 of which reads:
82
Cyborg Leasing Corporation12 wherein the Court, in disposing of the jurisdictional issue, limited its At the outset, it is necessary to stress that generally a direct recourse to this Court is highly
consideration only to the actual or compensatory damages. improper, for it violates the established policy of strict observance of the judicial hierarchy of courts.
Although this Court, the RTCs and the Court of Appeals (CA) have concurrent jurisdiction to issue
Furthermore, while admitting that the defense of lack of jurisdiction was only raised during the trial, writs of certiorari, prohibition, mandamus, quo warranto, habeas corpus and injunction, such
petitioners nevertheless contend that jurisdiction may be raised anytime, even after judgment, but concurrence does not give the petitioner unrestricted freedom of choice of court forum. This Court is
before it is barred by laches or estoppel. They submit that they seasonably presented the objection a court of last resort, and must so remain if it is to satisfactorily perform the functions assigned to it
to the RTC’s lack of jurisdiction, i.e., during the trial stage where no decision had as yet been by the Constitution and immemorial tradition.13
rendered, must less one unfavorable to them.
Thus, this Court, as a rule, will not entertain direct resort to it unless the redress desired cannot be
At any rate, they argue that when the jurisdictional flaw is evident from the record of the case, the obtained in the appropriate courts, and exceptional and compelling circumstances, such as cases of
court may, even without the urgings of the parties, take judicial notice of such fact, and thereupon national interest and of serious implications, justify the availment of the extraordinary remedy of writ
dismiss the case motu proprio.Thus, even if lack of jurisdiction was not initially raised in a motion to of certiorari, calling for the exercise of its primary jurisdiction.14 Such exceptional and compelling
dismiss or in the answer, no waiver may be imputed to them. circumstances were present in the following cases: (a) Chavez vs. Romulo15 on the citizens’ right to
bear arms; (b) Government of the United States of America vs. Purganan16 on bail in extradition
proceedings; (c) Commission on Elections vs. Quijano-Padilla17 on a government contract on the
Private respondent, on the other hand, submits that in an action for recovery of damages arising
modernization and computerization of the voters’ registration list; (d) Buklod ng Kawaning EIIB vs.
from a tortious act, the claim of moral damages is not merely an incidental or consequential claim
Zamora[18] on the status and existence of a public office; and (e) Fortich vs. Corona19 on the so-
but must be considered in the amount of demand which will determine the court’s jurisdiction. He
called "Win-Win Resolution" of the Office of the President which modified the approval of the
argues that the position taken by petitioners is a misreading of paragraph 2 of Administrative conversion to agro-industrial area of a 144-hectare land.
Circular No. 09-94. The clear and explicit language of said circular leaves no room for doubt; hence,
needs no interpretation.
Be that as it may, the judicial hierarchy of courts is not an iron-clad rule. It generally applies to cases
involving warring factual allegations. For this reason, litigants are required to repair to the trial courts
He further submits that petitioners’ reliance on Movers-Baseco Integrated Port Services, Inc. is
at the first instance to determine the truth or falsity of these contending allegations on the basis of
misplaced since that case is for recovery of the value of vehicle and unpaid rentals on the lease of
the evidence of the parties. Cases which depend on disputed facts for decision cannot be brought
the same. He contends that Section 18, paragraph 8 of Batas Pambansa Blg. 129, as amended by
immediately before appellate courts as they are not triers of facts.20 Therefore, a strict application of
Republic Act No. 7691, upon which petitioners anchor their stand, refers to all the demands
the rule of hierarchy of courts is not necessary when the cases brought before the appellate courts
involving collection of sums of money based on obligations arising from contract, express or implied, do not involve factual but legal questions.
where the claim for damages is just incidental thereto and it does not apply to actions for damages
based on obligations arising from quasi-delict where the claim for damages of whatever kind is the
main action. In the present case, petitioners submit a pure question of law involving the interpretation and
application of paragraph 2 of Administrative Circular No. 09-94. This legal question and in order to
avoid further delay are compelling enough reasons to allow petitioners’ invocation of this Court’s
Private respondent also contends that, being incapable of pecuniary computation, the amount of jurisdiction in the first instance.
moral damages that he may be awarded depends on the sound discretion of the trial court, not
restrained by the limitation of the jurisdictional amount. Should the Court follow petitioners’ line of
reasoning, private respondent argues that it will result in an absurd situation where he can only be Before resolving this issue, the Court shall deal first on the question of estoppel posed by private
awarded moral damages of not more than P200,000.00 although he deserves more than this respondent. Private respondent argues that the defense of lack of jurisdiction may be waived by
amount, taking into consideration his physical suffering, as well as social and financial standing, estoppel through active participation in the trial. Such, however, is not the general rule but an
simply because his claim for actual damages does not exceed P200,000.00 which amount falls exception, best characterized by the peculiar circumstances in Tijam vs.
under the jurisdiction of the MTC. Sibonghanoy.21 In Sibonghanoy, the party invoking lack of jurisdiction did so only after fifteen years
and at a stage when the proceedings had already been elevated to the CA. Sibonghanoy is an
exceptional case because of the presence of laches, which was defined therein as failure or neglect
Lastly, he asserts that it is too late in the day for petitioners to question the jurisdiction of the RTC
for an unreasonable and unexplained length of time to do that which, by exercising due diligence,
since they are estopped from invoking this ground. He contends that after actively taking part in the
could or should have been done earlier; it is the negligence or omission to assert a right within a
trial proceedings and presenting a witness to seek exoneration, it would be unfair and legally
reasonable time, warranting a presumption that the party entitled to assert has abandoned it or
improper for petitioners to seek the dismissal of the case.
declined to assert it.22

83
As enunciated in Calimlim vs. Ramirez,23 this Court held: the Sibonghanoy doctrine does not control the present controversy. Instead, the general rule that
the question of jurisdiction of a court may be raised at any stage of the proceedings must apply.
A rule that had been settled by unquestioned acceptance and upheld in decisions so numerous to Therefore, petitioners are not estopped from questioning the jurisdiction of the RTC.
cite is that the jurisdiction of a court over the subject matter of the action is a matter of law and may
not be conferred by consent or agreement of the parties. The lack of jurisdiction of a court may be In any event, the petition for certiorari is bereft of merit.
raised at any stage of the proceedings, even on appeal. This doctrine has been qualified by recent
pronouncements which stemmed principally from the ruling in the cited case of Sibonghanoy. It is to Section 1 of Republic Act (R.A.) No. 7691, which took effect on April 15, 1994, provides inter
be regretted, however, that the holding in said case had been applied to situations which were alia that where the amount of the demand in civil cases exceeds P100,000.00,26 exclusive of
obviously not contemplated therein. The exceptional circumstances involved in Sibonghanoy which interest, damages of whatever kind, attorney’s fees, litigation expenses, and costs, the exclusive
justified the departure from the accepted concept of non-waivability of objection to jurisdiction has jurisdiction thereof is lodged with in the RTC. Under Section 3 of the same law, where the amount of
been ignored and, instead a blanket doctrine had been repeatedly upheld that rendered the the demand in the complaint does not exceed P100,000.00, exclusive of interest, damages of
supposed ruling in Sibonghanoy not as the exception, but rather the general rule, virtually whatever kind, attorney’s fees, litigation expenses, and costs, the exclusive jurisdiction over the
overthrowing altogether the time honored principle that the issue of jurisdiction is not lost by waiver same is vested in the Metropolitan Trial Court, MTC and Municipal Circuit Trial Court. The
or by estoppel. jurisdictional amount was increased to P200,000.00,27 effective March 20, 1999, pursuant to Section
528 of R.A. No. 7691 and Administrative Circular No. 21-99.
...
In Administrative Circular No. 09-94 dated March 14, 1994, the Court specified the guidelines in the
It is neither fair nor legal to bind a party by the result of a suit or proceeding which was taken implementation of R.A. No. 7691. Paragraph 2 of the Circular provides:
cognizance of in a court which lacks jurisdiction over the same irrespective of the attendant
circumstances. The equitable defense of estoppel requires knowledge or consciousness of the facts 2. The exclusion of the term "damages of whatever kind in determining the jurisdictional amount
upon which it is based. The same thing is true with estoppel by conduct which may be asserted only under Section 19 (8) and Section 33 (1) of B.P. Blg. 129, as amended by R.A. No. 7691, applied to
when it is shown, among others, that the representation must have been made with knowledge of cases where the damages are merely incidental to or a consequence of the main cause of action.
the facts and that the party to whom it was made is ignorant of the truth of the matter (De Castro vs. However, in cases where the claim for damages is the main cause of action, or one of the
Gineta, 27 SCRA 623). The filing of an action or suit in a court that does not possess jurisdiction to causes of action, the amount of such claim shall be considered in determining the
entertain the same may not be presumed to be deliberate and intended to secure a ruling which jurisdiction of the court. (Emphasis supplied)
could later be annulled if not favorable to the party who filed such suit or proceeding. Instituting such
an action is not a one-sided affair. It can just as well be prejudicial to the one who file the action or
The well-entrenched principle is that the jurisdiction of the court over the subject matter of the action
suit in the event that he obtains a favorable judgment therein which could also be attacked for
is determined by the material allegations of the complaint and the law, irrespective of whether or not
having been rendered without jurisdiction. The determination of the correct jurisdiction of a court is
the plaintiff is entitled to recover all or some of the claims or reliefs sought therein. 29 In the present
not a simple matter. It can raise highly debatable issues of such importance that the highest tribunal
case, the allegations in the complaint plainly show that private respondent seeks to recover not only
of the land is given the exclusive appellate jurisdiction to entertain the same. The point simply is that
his medical expenses, lost income but also damages for physical suffering and mental anguish due
when a party commits error in filing his suit or proceeding in a court that lacks jurisdiction to take
to permanent facial deformity from injuries sustained in the vehicular accident. Viewed as an action
cognizance of the same, such act may not at once be deemed sufficient basis of estoppel. It could
for quasi-delict, the present case falls squarely within the purview of Article 2219 (2), 30 which
have been the result of an honest mistake or of divergent interpretations of doubtful legal provisions.
provides for the payment of moral damages in cases of quasi-delict causing physical injuries.
If any fault is to be imputed to a party taking such course of action, part of the blame should be
placed on the court which shall entertain the suit, thereby lulling the parties into believing that they
pursued their remedies in the correct forum. Under the rules, it is the duty of the court to dismiss an Private respondent’s claim for moral damages of P500,000.00 cannot be considered as merely
action "whenever it appears that court has no jurisdiction over the subject matter." (Section 2, Rule incidental to or a consequence of the claim for actual damages. It is a separate and distinct cause of
9, Rules of Court) Should the Court render a judgment without jurisdiction, such judgment may be action or an independent actionable tort. It springs from the right of a person to the physical integrity
impeached or annulled for lack of jurisdiction (Sec. 30, Rule 132, Ibid), within ten (10) years from of his or her body, and if that integrity is violated, damages are due and assessable.31 Hence, the
the finality of the same (Art. 1144, par. 3, Civil Code).24 demand for moral damages must be considered as a separate cause of action, independent of the
claim for actual damages and must be included in determining the jurisdictional amount, in clear
consonance with paragraph 2 of Administrative Circular No. 09-94.
In the present case, no judgment has yet been rendered by the RTC.25 As a matter of fact, as soon
as the petitioners discovered the alleged jurisdictional defect, they did not fail or neglect to file the
appropriate motion to dismiss. Hence, finding the pivotal element of laches to be absent, If the rule were otherwise, i.e., the court’s jurisdiction in a case of quasi-delict causing physical
injuries would only be based on the claim for actual damages and the complaint is filed in the MTC,
84
it can only award moral damages in an amount within its jurisdictional limitations, a situation not
intended by the framers of the law.

It must be remembered that moral damages, though incapable of pecuniary estimation, are
designed to compensate and alleviate in some way the physical suffering, mental anguish, fright,
serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation, and
similar injury unjustly caused a person.32 Moral damages are awarded to enable the injured party to
obtain means, diversions or amusements that will serve to alleviate the moral suffering he/she has
undergone, by reason of the defendant’s culpable action. Its award is aimed at restoration, as much
as possible, of the spiritual status quo ante; thus, it must be proportionate to the suffering inflicted.
Since each case must be governed by its own peculiar circumstances, there is no hard and fast rule
in determining the proper amount.33

The petitioners’ reliance in the case of Movers-Baseco Integrated Port Services, Inc. vs. Cyborg
Leasing Corporation34 is misplaced. The claim for damages therein was based on a breach of a
contract of lease, not a quasi-delict causing physical injuries, as in this case. Besides, there was no
claim therein for moral damages. Furthermore, moral damages are generally not recoverable in
damage actions predicated on a breach of contract in view of the provisions of Article 2220 35 of the
Civil Code.

In view of the foregoing, the Court is convinced that the respondent RTC Judge committed no grave
abuse of discretion in issuing the assailed Orders dated April 17, 2000 and June 13, 2000.

WHEREFORE, the instant petition for certiorari is DISMISSED for lack of merit. The temporary
restraining order issued by this Court on August 9, 2000 is LIFTED.

The Regional Trial Court, Branch 56, San Carlos City is DIRECTED to continue with the trial
proceedings in Civil Case No. SCC-2240 and resolve the case with dispatch.

Costs against petitioners. SO ORDERED.

85
G.R. No. 138542 August 25, 2000 Defendant Alfredo would each time be sensitive, evasive, and drunk, so nothing became of
ALFREDO P. PASCUAL and LORETA S. PASCUAL vs. COURT OF APPEALS those efforts.

The question for decision in this case is whether an action for reconveyance of a piece of land and ....
for accounting and damages which private respondent Ernesto P. Pascual brought against his
brother, petitioner Alfredo P. Pascual, and the latter’s wife involves an intra-corporate dispute 10. Since defendant Alfredo was President of L.R. Pascual & Sons, Inc. which held family
beyond the jurisdiction of the Regional Trial Court, Branch 121, Kalookan City in which it was filed. properties in Quezon City, Manila, and Baguio, plaintiff wanted this matter taken up in a
The trial court held that the action did not constitute an intra-corporate dispute and, therefore, meeting he requested with defendant Alfredo. In addition, plaintiff asked defendant Alfredo
denied petitioners’ motion to dismiss. The Court of Appeals sustained the order of the trial court. for an accounting in L.R. Pascual & Co., a registered partnership distinct from L.R. Pascual
Hence, this petition for review of the decision1 of the appellate court. We affirm. & Sons, Inc. which would be discussed in that requested meeting.

The facts are as follows: ....

On February 7, 1996, private respondent Ernesto P. Pascual filed a complaint in the Regional Trial 12. Because of defendant Alfredo’s icy silence and unmistakable attempts to claim the lid
Court for "accounting, reconveyance of real property based on implied trust resulting from fraud, on plaintiff Ernesto Pascual, plaintiff conducted an inquiry. As a result, he discovered that
declaration of nullity of TCT, recovery of sums of money, and damages" against his brother, when defendant Alfredo caused the dissolution of Phillens Manufacturing Corporation by
petitioner Alfredo, and the latter’s wife Loreta Pascual. The pertinent parts of his complaint read: asking for a shortening of its term, defendant Alfredo represented in an affidavit of
undertaking that
3. Plaintiff Ernesto and defendant Alfredo Pascual are full blood brothers. They, along with
Araceli P. Castro, Ester P. Abad, Edgardo P. Pascual, Sr. (now deceased), Corazon P. (a) he is the owner of the majority of the outstanding capital stock of the
Montenegro, Leonor P. Rivera, Luciano Pascual, Jr., and Teresita P. Manuel, are legitimate corporation;
children of Luciano Pascual, Sr. and Consolacion Pascual. Defendant Loreta Pascual is the
wife of defendant Alfredo.
(b) that the corporation has no obligation, whether existing or contingent, direct or
indirect, due or payable to any person whomsoever, natural or juridical;
4. Between 1963 to 1975, Luciano R. Pascual, Sr. acquired substantial shares in Phillens
Manufacturing Corp. Luciano, Sr. parceled out and assigned a good number of these
shares in the names of his children. (c) he is assuming and will pay any and all valid claims or demands by creditors,
stockholders, or any third person or persons, presented after the dissolution of the
corporation.
5. With Luciano’s substantial shareholdings, his eldest son, defendant Alfredo became
President, General Manager, and Vice-Chairman of the Board of Phillens. Plaintiff was only
20 years old then. 13. By taking a position adverse to the trust and to his family’s, defendant Alfredo, greatly
profiting from Phillens, now held he owned majority and will undertake to pay any claimant
or creditor. Yet, defendant Alfredo had not paid plaintiff what was properly owing to him.
6. Defendant Alfredo was also president of L.R. Pascual & Sons, Inc. which held
substantial shares in Phillens. (Plaintiff is a stockholder of L. R. Pascual & Sons, Inc.)
14. Plaintiff also discovered, to his dismay, that defendant Alfredo had written an October 8,
1990 letter to the Securities & Exchange Commission falsely representing as follows:
7. Although during and after the lifetime of the parties’ parents, defendant Alfredo held
family property in trust for Luciano Sr. and Consolacion, and for his brothers and sisters,
October 8, 1990
defendant Alfredo gave the latter no accounting at any point in time contrary to what their
father intended.
Examiner & Appraiser Dept. [sic]
Securities & Exchange Commission
8. Because from 1969 to 1990, defendant Alfredo turned over zero profit to plaintiff Ernesto
E. de los Santos Avenue
as far as his share was concerned, plaintiff tried to arrange a meeting between them about
Mandaluyong, Metro Manila
the matter of accounting -- without any success during a 5-year period (1990-1995).

86
Gentlemen: 6. Defendant Alfredo held in trust for the benefit of Luciano Sr. and Consolacion, and for his
brothers and sisters, plaintiff included, said stockholdings and the properties of Phillens.
This will certify that the P3.3-million notes payable as shown in the balance sheet of
Phillens Manufacturing Corporation as of June 30, 1990, is [sic] my personal advances. 7. As trustee defendant Alfredo did not turn over the properties and sums due to plaintiff
and the former even failed to account for the trust estate and its earnings, to the grave
Since I am assuming the assets and liabilities of the company, to which all the stockholders prejudice of the latter.
have consented, I am likewise giving my consent to the dissolution of the corporation.
8. One of the properties composing the trust estate, TCT No. C-28572 with an area of
Very truly yours, 7,528 square meters located in Caloocan City, was registered in the name of defendants
ALFREDO P. PASCUAL under devious and fraudulent circumstances engineered by Alfredo.

16. Further, on inquiry, plaintiff discovered that last April 3, 1989, defendant Alfredo caused 8.1. Said property was appraised conservatively to have a market value of no less
an appraisal of the fair market value of the land and buildings of Phillens in Kalookan, than P10.9 Million in 1989.
excluding equipment, remaining stock and inventory. Aware that Cuervo had appraised
such properties at P10,977,000 as of March 10, 1989, defendant Alfredo hatched a ploy to 8.2 Although Alfredo was fully aware of its market value, Alfredo schemed,
buy for himself such properties at only P4.5 million. (A copy of the April 3, 1989 Cuervo manipulated and succeeded in transferring title to and possession in his favor of
report addressed to defendant Alfredo is here attached as Annex A.) TCT No. C-28572 in 1989 for an alleged consideration of P4.5 Million, in violation
of his duties as trustee.
18. To consummate his fraudulent design, defendant Alfredo caused in bad faith the
cancellation of TCT C-28572 and the issuance of TCT 215804 in his and defendant 8.3 In order to cover-up such serious breach of trust, Alfredo maliciously caused
Loreta’s name (copy of which is here attached as Annex D). That TCT is of course void, the dissolution of Phillens in 1990, shortly after ownership was transferred to him,
proceeding as it does from a void transfer, which constitutes fraud and a breach of trust. and further caused the destruction of Phillens records thereby rendering its stocks
valueless after its corporate affairs were wound up in 1993.
On March 21, 1996, petitioners filed a motion to dismiss on the ground that the complaint raises an
intra-corporate controversy between the parties over which original and exclusive jurisdiction is 8.4 Defendants presently appear as legal and beneficial owners by virtue of TCT
vested in the Securities and Exchange Commission (SEC). At first, the trial court granted No. C-215804.
petitioners’ motion and dismissed the complaint on the ground that the complaint stemmed from
alleged fraudulent acts and misrepresentations of petitioner Alfredo P. Pascual as a corporate Petitioners reiterate their contention that the complaint against them involves an intra-corporate
officer of Phillens Manufacturing Corp. (Phillens) and thus the SEC had jurisdiction over the case. dispute cognizable by the SEC and, therefore, the Regional Trial Court should have dismissed the
However, on respondent’s motion, the trial court reconsidered its order and reinstated respondent’s complaint. They complain that the trial court should not have allowed the amendment of the
action. In an order, dated September 29, 1997, the trial court held that, since the corporation had complaint because it was done in order to confer jurisdiction on the trial court.
been dissolved in 1990 and its corporate affairs terminated in 1993, there were no more corporate
affairs to speak of at the time of the filing of the complaint. The court also allowed the amendment of
First. Petitioners contend that the existence of a corporation at the time of filing of a complaint
the complaint. It appears that, pending resolution of the motion for reconsideration, respondent
amended his complaint by alleging the following matters which are underlined: involving an intra-corporate dispute is not required in order that such dispute be cognizable by the
SEC because such requirement is not found in P.D. No. 902-A.

4. Luciano R. Pascual, Sr. together with L.R. Pascual & Sons. Inc. acquired approximately
This contention has no merit. P.D. 902-A, §5 provides:
38% of shares in Phillens Manufacturing Corp., a close corporation. Luciano Sr. died in
1984 while Consolacion died in 1986. Thus, plaintiff became owner by operation of law of
1/9 of his parents’ stockholdings since they died intestate without obligations. In addition to the regulatory and adjudicative functions of the Securities and Exchange Commission
over corporations, partnerships and other forms of association registered with it as expressly
5. With Luciano’s substantial shareholdings, defendant Alfredo became President, General granted under existing laws and decrees, it shall have original and exclusive jurisdiction to hear and
decide cases involving:
Manager, and Vice-Chairman of Phillens in 1968 or 1969, positions which he held until
1990 when Phillens was dissolved.

87
.... functions of the SEC, insofar as intra-corporate controversies are concerned, comes into play only if
a corporation still exists.
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 In the case at bar, the corporation whose properties are being contested no longer exists, it having
or association of which they are stockholders, members or associates, respectively; and between been completely dissolved in 1993; consequently, the supervisory authority of the SEC over the
such corporation, partnership or association and the state insofar as it concerns their individual corporation has likewise come to an end.
franchise or right to exist as such entity;
It is true that a complaint for accounting, reconveyance, etc. of corporate properties has previously
.... been held to be within the jurisdiction of the SEC.6 Nonetheless, a distinction can be drawn between
those cases and the case at bar, for, in those cases, the corporations involved were still existing,
Sec. 5(b) does not define what an intra-corporate controversy is, but case law has fashioned out whereas in the present case, there is no more corporation involved. There is no question that
two tests for determining what suit is cognizable by the SEC or the regular courts, and sometimes assessing the financial status of an existing corporation, for purposes of an action for accounting,
by the National Labor Relations Commission. The first test uses the enumeration in §5(b) of the requires the expertise of the SEC. But in the case of a dissolved corporation, no such expertise is
relationships to determine jurisdiction,2 to wit: required, for all its business has been properly accounted for already, and what is left to be
determined is properly within the competence of regular courts.
(1) Those between and among stockholders and members;
It may be noted in this connection that pursuant to R.A. No. 8799, §5.2,7 which took effect on
August 8, 2000, the jurisdiction of the SEC to decide cases involving intra-corporate dispute was
(2) Those between and among stockholders and members, on one hand, and the
transferred to courts of general jurisdiction and, in accordance therewith, all cases of this nature,
corporation, on the other hand; and
with the exception only of those submitted for decision, were transferred to the regular courts.
Hence, the question whether this case should be filed in the SEC is now only of academic interest.
(3) Those between the corporation and the State but only insofar as its franchise or right to For even if it involves an intra-corporate dispute, it would be remanded to the Regional Trial Court
exist as an entity is concerned. just the same.

The second test, on the other hand, focuses on the nature of the controversy itself. 3 Recent Second. Petitioners contend that the lower courts erred in allowing the amendment of the
decisions of this Court consider not only the subject of their controversy but also the status of the complaint, which were actually made to confer jurisdiction on the trial court after the original
parties.4 complaint was dismissed.

We hold that the Court of Appeals correctly ruled that the regular courts, not the SEC, have This contention has no basis. The original complaint alleged that Phillens has already been
jurisdiction over this case.1âwphi1 Petitioners and private respondent never had any corporate completely dissolved. In addition, it alleged a breach by petitioner Alfredo P. Pascual of the implied
relations in Phillens. It appears that private respondent was never a stockholder in Phillens, of which trust created between him and his brother, respondent Ernesto P. Pascual, after the death of their
the parties’ predecessor-in-interest, Luciano Pascual, Sr., was a stockholder and whose properties father. Thus, even without the amendments, the allegations in the original complaint were sufficient
are being litigated. Private respondent’s allegation is that, upon the death of their father, he became to confer jurisdiction on the trial court. The amendments made by respondent were merely for the
co-owner in the estate left by him, and part of this estate includes the corporate interests in Phillens. purpose of making more specific his original allegations.
He also alleges that petitioners repudiated the trust relationship created between them and
appropriated to themselves even the property that should have belonged to respondent. It is thus WHEREFORE, the decision of the Court of Appeals is AFFIRMED. SO ORDERED.
clear that there is no corporate relationship involved here. That petitioner Alfredo Pascual was a
corporate officer holding in trust for his brother their father’s corporate interests did not create an
intra-corporate relationship between them.

Nor is the controversy corporate in nature. As we have stated before, the grant of jurisdiction must
be viewed in the light of the nature and function of the SEC under the law.5 P.D. No. 902-A, §3 gives
the SEC jurisdiction, supervision, and control over all corporations, partnerships or associations,
who are the grantees of primary franchise and/or a license or permit issued by the government to
operate in the Philippines. From this, it can be deduced that the regulatory and adjudicatory
88
Hence, the instant petition.

G.R. No. 140453 October 17, 2000 The Court required respondents to file their comment and petitioners to file their reply thereon,
TRANSFARM & CO., INC., and TRANSDAEWOO AUTOMOTIVE MANUFACTURING respectively, in its resolutions of 25 November 1999 and 21 June 2000.
COMPANY vs. DAEWOO CORPORATION and DAEWOO MOTOR CO., LTD
During the pendency of the petition, Republic Act No. 8799, otherwise also known as The Securities
Assailed in the Petition for Review on Certiorari under consideration are the decision and the Regulation Code, was enacted into law, providing, inter alia, that -
resolution of the Court of Appeals, dated 29 July and 13 October 1999, respectively, in CA-
G.R. SP No. 47558. "5.2. The Commission's 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
Sometime in 1994, Daewoo Corporation (Daewoo) entered into a joint venture agreement with Regional Trial Court: Provided, That the Supreme Court in the exercise of its authority may
Transfarm & Co. (Transfarm) for the delivery, assembly, production and distribution of Daewoo designate the Regional Trial Court branches that shall exercise jurisdiction over these cases. The
cars in the Philippines. Under the agreement, Transdaewoo Automotive Manufacturing 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.
Company (TAMC) was to be incorporated with Transfarm owning seventy percent (70%) and
The Commission shall retain jurisdiction over pending suspension of payments/rehabilitation cases
Daewoo holding thirty percent (30%) of the shares of stock. The new firm was also to
filed as of 30 June 2000 until finally disposed."1
undertake the manufacture, assembly, marketing, wholesale distribution and sale and after-
sales service of Daewoo products. Transfarm and the joint venture company TAMC were then
to enter into a separate agreement that would name Transfarm as the exclusive distributor in Statutes regulating court jurisdiction and procedures are generally construed to be applicable to
actions pending and undetermined at the time of the passage of said enactments.1âwphi12 The
the Philippines of Daewoo cars.
instant case, neither filed with the Securities and Exchange Commission nor therewith pending, let
alone ready for final resolution by it, is clearly cognizable by the RTC under the amendatory law.
The parties stipulated that any dispute, controversy or claim among the parties arising out of,
relating to, or in connection with the joint venture agreement itself should be settled by WHEREFORE, the decision of the appellate court subject of the instant petition for review is SET
arbitration to be conducted in Hongkong. The joint venture agreement, however, was to be ASIDE, and the case is REMANDED to the Regional Trial Court of Cebu City for further
governed by and construed in accordance with the laws of the Philippines. proceedings. No costs. SO ORDERED.

The agreement went awry in December of 1997. Transfarm and TAMC filed a complaint with
the Regional Trial Court (RTC), Branch 5, of Cebu City, docketed Civil Case No. CEB-21367,
against Daewoo and Daewoo Motor Co., Ltd. (DMCL), a corporation organized under the laws
of the Republic of Korea and not doing business in the Philippines, praying that Daewoo and
DMCL be ordered to refrain from conducting and doing, directly or indirectly, automotive
business in the Philippines.

On 20 January 1998, Daewoo and DMCL filed a motion to dismiss the case moored, inter alia,
on the ground that the case involved an intra-corporate dispute cognizable exclusively by the
Securities and Exchange Commission (SEC). In its resolution of 25 March 1998, the RTC
denied the Motion to Dismiss and directed the defendants to file their respective answers.

Transfarm and TAMC filed a petition for certiorari, prohibition and mandamus before the Court
of Appeals. The appellate court, in its 29th July 1999 decision, declared that the jurisdiction
over the case rested with the SEC and, accordingly, granted the petition and ordered the
dismissal of the complaint. The subsequent motion for reconsideration was rebuffed.

89
7. Nonetheless, on September 19, 2002, plaintiff was shocked/surprised to receive a
letter from the incumbent Corporate Secretary of the defendant Medical Plaza Makati,
demanding payment of alleged unpaid association dues and assessments arising from
plaintiff’s condominium unit no. 1201. The said letter further stressed that plaintiff is
G.R. No. 181416 November 11, 2013 considered a delinquent member of the defendant Medical Plaza Makati.
MEDICAL PLAZA MAKATI CONDOMINIUM CORPORATION vs. ROBERT H. CULLEN
8. As a consequence, plaintiff was not allowed to file his certificate of candidacy as
This is a petition for review on certiorari under Rule 45 of the Rules of Court assailing the Court director. Being considered a delinquent, plaintiff was also barred from exercising his
of Appeals (CA) Decision1 dated July 10, 2007 and Resolution2 dated January 25, 2008 in CA- right to vote in the election of new members of the Board of Directors x x x;
G.R. CV No. 86614. The assailed decision reversed and set aside the September 9, 2005
Order3 of the Regional Trial Court (RTC) of Makati, Branch 58 in Civil Case No. 03-1018; while 9. x x x Again, prior to the said election date, x x x counsel for the defendant [MPMCC]
the assailed resolution denied the separate motions for reconsideration filed by petitioner sent a demand letter to plaintiff, anent the said delinquency, explaining that the said
Medical Plaza Makati Condominium Corporation (MPMCC) and Meridien Land Holding, Inc. unpaid amount is a carry-over from the obligation of defendant Meridien. x x x;
(MLHI).
10. Verification with the defendant [MPMCC] resulted to the issuance of a certification
The factual and procedural antecedents are as follows: stating that Condominium Unit 1201 has an outstanding unpaid obligation in the total
amount of P145,567.42 as of November 30, 2002, which again, was attributed by
Respondent Robert H. Cullen purchased from MLHI condominium Unit No. 1201 of the defendant [MPMCC] to defendant Meridien. x x x;
Medical Plaza Makati covered by Condominium Certificate of Title No. 45808 of the Register of
Deeds of Makati. Said title was later cancelled and Condominium Certificate of Title No. 64218 11. Due to the seriousness of the matter, and the feeling that defendant Meridien made
was issued in the name of respondent. false representations considering that it fully warranted to plaintiff that condominium
unit 1201 is free and clear from all liens and encumbrances, the matter was referred to
On September 19, 2002, petitioner, through its corporate secretary, Dr. Jose Giovanni E. counsel, who accordingly sent a letter to defendant Meridien, to demand for the
Dimayuga, demanded from respondent payment for alleged unpaid association dues and payment of said unpaid association dues and other assessments imposed on the
assessments amounting to P145,567.42. Respondent disputed this demand claiming that he condominium unit and being claimed by defendant [MPMCC]. x x x;
had been religiously paying his dues shown by the fact that he was previously elected
president and director of petitioner.4 Petitioner, on the other hand, claimed that respondent’s 12. x x x defendant Meridien claimed however, that the obligation does not exist
obligation was a carry-over of that of MLHI.5 Consequently, respondent was prevented from considering that the matter was already settled and paid by defendant Meridien to
exercising his right to vote and be voted for during the 2002 election of petitioner’s Board of defendant [MPMCC]. x x x;
Directors.6Respondent thus clarified from MLHI the veracity of petitioner’s claim, but MLHI
allegedly claimed that the same had already been settled. 7 This prompted respondent to 13. Plaintiff thus caused to be sent a letter to defendant [MPMCC] x x x. The said letter
demand from petitioner an explanation why he was considered a delinquent payer despite the x x x sought an explanation on the fact that, as per the letter of defendant Meridien, the
settlement of the obligation. Petitioner failed to make such explanation. Hence, the Complaint delinquency of unit 1201 was already fully paid and settled, contrary to the claim of
for Damages8 filed by respondent against petitioner and MLHI, the pertinent portions of which defendant [MPMCC]. x x x;
read:
14. Despite receipt of said letter on April 24, 2003, and to date however, no
. Thereafter, plaintiff occupied the said condominium unit no. 1201 and religiously paid explanation was given by defendant [MPMCC], to the damage and prejudice of plaintiff
all the corresponding monthly contributions/association dues and other assessments who is again obviously being barred from voting/participating in the election of
imposed on the same. For the years 2000 and 2001, plaintiff served as President and members of the board of directors for the year 2003;
Director of the Medical Plaza Makati Condominium Corporation;
15. Clearly, defendant [MPMCC] acted maliciously by insisting that plaintiff is a
delinquent member when in fact, defendant Meridien had already paid the said

90
delinquency, if any. The branding of plaintiff as delinquent member was willfully and been settled by MLHI. It, likewise, ruled that the issues raised are intra-corporate between the
deceitfully employed so as to prevent plaintiff from exercising his right to vote or be corporation and member.13
voted as director of the condominium corporation; 16. Defendant [MPMCC]’s ominous
silence when confronted with claim of payment made by defendant Meridien is On appeal, the CA reversed and set aside the trial court’s decision and remanded the case to
tantamount to admission that indeed, plaintiff is not really a delinquent member; the RTC for further proceedings. Contrary to the RTC conclusion, the CA held that the
controversy is an ordinary civil action for damages which falls within the jurisdiction of regular
17. Accordingly, as a direct and proximate result of the said acts of defendant courts.14 It explained that the case hinged on petitioner’s refusal to confirm MLHI’s claim that
[MPMCC], plaintiff experienced/suffered from mental anguish, moral shock, and the subject obligation had already been settled as early as 1998 causing damage to
serious anxiety. Plaintiff, being a doctor of medicine and respected in the community respondent.15 Petitioner’s and MLHI’s motions for reconsideration had also been denied. 16
further suffered from social humiliation and besmirched reputation thereby warranting
the grant of moral damages in the amount of P500,000.00 and for which defendant Aggrieved, petitioner comes before the Court based on the following grounds:
[MPMCC] should be held liable;
I.THE COURT A QUO HAS DECIDED A QUESTION OF SUBSTANCE, NOT THERETOFORE
18. By way of example or correction for the public good, and as a stern warning to all DETERMINED BY THE SUPREME COURT, OR HAS DECIDED IT IN A WAY NOT IN
similarly situated, defendant [MPMCC] should be ordered to pay plaintiff exemplary ACCORD WITH LAW OR WITH THE APPLICABLE DECISIONS OF THE SUPREME COURT
damages in the amount of P200,000.00; WHEN IT DECLARED THE INSTANT CASE AN ORDINARY ACTION FOR DAMAGES
INSTEAD OF AN INTRA-CORPORATE CONTROVERSY COGNIZABLE BY A SPECIAL
19. As a consequence, and so as to protect his rights and interests, plaintiff was COMMERCIAL COURT.
constrained to hire the services of counsel, for an acceptance fee of P100,000.00
plus P2,500.00 per every court hearing attended by counsel; II.THE COURT A QUO HAS DECIDED THE INSTANT CASE IN A WAY NOT IN ACCORD
WITH LAW OR WITH THE APPLICABLE DECISIONS OF THE SUPREME COURT WHEN IT
20. In the event that the claim of defendant [MPMCC] turned out to be true, however, TOOK COGNIZANCE OF THE APPEAL WHILE RAISING ONLY PURE QUESTIONS OF
the herein defendant Meridien should be held liable instead, by ordering the same to LAW.17
pay the said delinquency of condominium unit 1201 in the amount of P145,567.42 as
of November 30, 2002 as well as the above damages, considering that the non- The petition is meritorious.
payment thereof would be the proximate cause of the damages suffered by plaintiff; 9
It is a settled rule that jurisdiction over the subject matter is determined by the allegations in the
Petitioner and MLHI filed their separate motions to dismiss the complaint on the ground of lack complaint. It is not affected by the pleas or the theories set up by the defendant in an answer
of jurisdiction.10MLHI claims that it is the Housing and Land Use Regulatory Board (HLURB) or a motion to dismiss. Otherwise, jurisdiction would become dependent almost entirely upon
which is vested with the exclusive jurisdiction to hear and decide the case. Petitioner, on the the whims of the defendant.18 Also illuminating is the Court’s pronouncement in Go v.
other hand, raises the following specific grounds for the dismissal of the complaint: (1) estoppel Distinction Properties Development and Construction, Inc.:19
as respondent himself approved the assessment when he was the president; (2) lack of
jurisdiction as the case involves an intra-corporate controversy; (3) prematurity for failure of Basic as a hornbook principle is that jurisdiction over the subject matter of a case is conferred
respondent to exhaust all intra-corporate remedies; and (4) the case is already moot and
by law and determined by the allegations in the complaint which comprise a concise statement
academic, the obligation having been settled between petitioner and MLHI. 11
of the ultimate facts constituting the plaintiff’s cause of action. The nature of an action, as well
as which court or body has jurisdiction over it, is determined based on the allegations
On September 9, 2005, the RTC rendered a Decision granting petitioner’s and MLHI’s motions contained in the complaint of the plaintiff, irrespective of whether or not the plaintiff is entitled to
to dismiss and, consequently, dismissing respondent’s complaint. recover upon all or some of the claims asserted therein. The averments in the complaint and
the character of the relief sought are the ones to be consulted. Once vested by the allegations
The trial court agreed with MLHI that the action for specific performance filed by respondent in the complaint, jurisdiction also remains vested irrespective of whether or not the plaintiff is
clearly falls within the exclusive jurisdiction of the HLURB.12 As to petitioner, the court held that entitled to recover upon all or some of the claims asserted therein. x x x 20
the complaint states no cause of action, considering that respondent’s obligation had already

91
Based on the allegations made by respondent in his complaint, does the controversy involve Condominium Corporation v. Moreno.27 In that case, respondents therein filed a complaint for
intra-corporate issues as would fall within the jurisdiction of the RTC sitting as a special intra-corporate dispute against the petitioner therein to question how it calculated the dues
commercial court or an ordinary action for damages within the jurisdiction of regular courts? assessed against them, and to ask an accounting of association dues. Petitioner, however,
moved for the dismissal of the case on the ground of lack of jurisdiction alleging that since the
In determining whether a dispute constitutes an intra-corporate controversy, the Court uses complaint was against the owner/developer of a condominium whose condominium project
two tests, namely, the relationship test and the nature of the controversy test. 21 was registered with and licensed by the HLURB, the latter has the exclusive jurisdiction. In
sustaining the denial of the motion to dismiss, the Court held that the dispute as to the validity
An intra-corporate controversy is one which pertains to any of the following relationships: (1) of the assessments is purely an intra-corporate matter between petitioner and respondent and
between the corporation, partnership or association and the public; (2) between the is thus within the exclusive jurisdiction of the RTC sitting as a special commercial court. More
so in this case as respondent repeatedly questioned his characterization as a delinquent
corporation, partnership or association and the State insofar as its franchise, permit or license
member and, consequently, petitioner’s decision to bar him from exercising his rights to vote
to operate is concerned; (3) between the corporation, partnership or association and its
and be voted for. These issues are clearly corporate and the demand for damages is just
stockholders, partners, members or officers; and (4) among the stockholders, partners or
incidental. Being corporate in nature, the issues should be threshed out before the RTC sitting
associates themselves.22 Thus, under the relationship test, the existence of any of the above
intra-corporate relations makes the case intra-corporate.23 as a special commercial court. The issues on damages can still be resolved in the same
special commercial court just like a regular RTC which is still competent to tackle civil law
issues incidental to intra-corporate disputes filed before it.28
Under the nature of the controversy test, "the controversy must not only be rooted in the
existence of an intra-corporate relationship, but must as well pertain to the enforcement of the
Moreover, Presidential Decree No. 902-A enumerates the cases over which the Securities and
parties’ correlative rights and obligations under the Corporation Code and the internal and
intra-corporate regulatory rules of the corporation."24 In other words, jurisdiction should be Exchange Commission (SEC) exercises exclusive jurisdiction:
determined by considering both the relationship of the parties as well as the nature of the
question involved.25 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
Applying the two tests, we find and so hold that the case involves intra-corporate controversy.
It obviously arose from the intra-corporate relations between the parties, and the questions 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;
involved pertain to their rights and obligations under the Corporation Code and matters relating
and
to the regulation of the corporation.26

Admittedly, petitioner is a condominium corporation duly organized and existing under c) Controversies in the election or appointment of directors, trustees, officers, or
Philippine laws, charged with the management of the Medical Plaza Makati. Respondent, on managers of such corporations, partnerships, or associations.29
the other hand, is the registered owner of Unit No. 1201 and is thus a stockholder/member of
the condominium corporation. Clearly, there is an intra-corporate relationship between the To be sure, this action partakes of the nature of an intra-corporate controversy, the jurisdiction
corporation and a stockholder/member. over which pertains to the SEC. Pursuant to Section 5.2 of Republic Act No. 8799, otherwise
known as the Securities Regulation Code, the jurisdiction of the SEC over all cases
The nature of the action is determined by the body rather than the title of the enumerated under Section 5 of Presidential Decree No. 902-A has been transferred to RTCs
complaint.1âwphi1 Though denominated as an action for damages, an examination of the designated by this Court as Special Commercial Courts. 30 While the CA may be correct that
the RTC has jurisdiction, the case should have been filed not with the regular court but with the
allegations made by respondent in his complaint shows that the case principally dwells on the
branch of the RTC designated as a special commercial court. Considering that the RTC of
propriety of the assessment made by petitioner against respondent as well as the validity of
Makati City, Branch 58 was not designated as a special commercial court, it was not vested
petitioner’s act in preventing respondent from participating in the election of the corporation’s
Board of Directors. Respondent contested the alleged unpaid dues and assessments with jurisdiction over cases previously cognizable by the SEC. 31The CA, therefore, gravely
demanded by petitioner. erred in remanding the case to the RTC for further proceedings.

Indeed, Republic Act (RA) No. 9904, or the Magna Carta for Homeowners and Homeowners’
The issue is not novel. The nature of an action involving any dispute as to the validity of the
Associations, approved on January 7, 2010 and became effective on July 10, 2010, empowers
assessment of association dues has been settled by the Court in Chateau de Baie
92
the HLURB to hear and decide inter-association and/or intra-association controversies or MR. DAYRIT.
conflicts concerning homeowners’ associations. However, we cannot apply the same in the
present case as it involves a controversy between a condominium unit owner and a Yes I agree with you. There are many, I think, practices in their provisions in the Condominium
condominium corporation. While the term association as defined in the law covers Law that may be conflicting with this version of ours.
homeowners’ associations of other residential real property which is broad enough to cover a
condominium corporation, it does not seem to be the legislative intent. A thorough review of
For instance, in the case of, let’s say, the condominium, the so-called common areas and/or
the deliberations of the bicameral conference committee would show that the lawmakers did
maybe so called open spaces that they may have, especially common areas, they are usually
not intend to extend the coverage of the law to such kind of association. We quote hereunder owned by the condominium corporation. Unlike a subdivision where the open spaces and/or
the pertinent portion of the Bicameral Conference Committee’s deliberation, to wit: the common areas are not necessarily owned by the association. Because sometimes ---
generally these are donated to the municipality or to the city. And it is only when the city or
THE CHAIRMAN (SEN. ZUBIRI). Let’s go back, Mr. Chair, very quickly on homeowners. municipality gives the approval or the conformity that this is donated to the homeowners’
association. But generally, under PD [Presidential Decree] 957, it’s donated. In the
THE ACTING CHAIRMAN (REP. ZIALCITA). Ang sa akin lang, I think our views are similar, Condominium Corporation, hindi. Lahat ng mga open spaces and common areas like corridors,
Your Honor, Senator Zubiri, the entry of the condominium units might just complicate the whole the function rooms and everything, are owned by the corporation. So that’s one main issue that
matters. So we’d like to put it on record that we’re very much concerned about the plight of the can be conflicting.
Condominium Unit Homeowners’ Association. But this could very well be addressed on a
separate bill that I’m willing to co-sponsor with the distinguished Senator Zubiri, to address in THE CHAIRMAN (SEN. ZUBIRI). I’ll just ask for a one-minute suspension so we can talk.
the Condominium Act of the Philippines, rather than address it here because it might just
create a red herring into the entire thing and it will just complicate matters, hindi ba? THE ACTING CHAIRMAN (REP. ZIALCITA). Unless you want to put a catchall phrase like
what we did in the Senior Citizen’s Act. Something like, to the extent --- paano ba iyon? To the
THE CHAIRMAN (SEN. ZUBIRI). I also agree with you although I sympathize with them--- extent that it is practicable and applicable, the rights and benefits of the homeowners, are
although we sympathize with them and we feel that many times their rights have been also hereby extended to the --- mayroon kaming ginamit na phrase eh...to the extent that it be
violated by abusive condominium corporations. However, there are certain things that we have practicable and applicable to the unit homeoweners, is hereby extended, something like that.
to reconcile. There are certain issues that we have to reconcile with this version. It’s a catchall phrase. But then again, it might create a...

In the Condominium Code, for example, they just raised a very peculiar situation under the MR. JALANDONI. It will become complicated. There will be a lot of conflict of laws between the
Condominium Code --- Condominium Corporation Act. It’s five years the proxy, whereas here, two laws.
it’s three years. So there would already be violation or there will be already a problem with their
version and our version. Sino ang matutupad doon? Will it be our version or their version?
THE ACTING CHAIRMAN (REP. ZIALCITA). Kaya nga eh. At saka, I don’t know. I think the ---
mayroon naman silang protection sa ano eh, di ba? Buyers decree doon sa Condominium Act.
So I agree that has to be studied further. And because they have a law pertaining to the I’m sure there are provisions there eh. Huwag na lang, huwag na lang.
condominium housing units, I personally feel that it would complicate matters if we include
them. Although I agree that they should be looked after and their problems be looked into. MR. JALANDONI. Mr. Chairman, I think it would be best if your previous comments that you’d
be supporting an amendment.1âwphi1 I think that would be --- Well, that would be the best
Probably we can ask our staff, Your Honor, to come up already with the bill although we have course of action with all due respect.
no more time. Hopefully we can tackle this again on the 15th Congress. But I agree with the
sentiments and the inputs of the Honorable Chair of the House panel. THE ACTING CHAIRMAN (REP. ZIALCITA). Yeah. Okay. Thank you. So iyon na lang final
proposal naming ‘yung catchall phrase, "With respect to the..."32
May we ask our resource persons to also probably give comments?
THE CHAIRMAN (SEN. ZUBIRI). xxx And so, what is their final decision on the definition of
Atty. Dayrit. homeowners?

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THE ACTING CHAIRMAN (REP. ZIALCITA).

We stick to the original, Mr. Chairman. We’ll just open up a whole can of worms and a whole
new ball game will come into play. Besides, I am not authorized, neither are you, by our
counterparts to include the condominium owners.

THE CHAIRMAN (SEN. ZUBIRI).

Basically that is correct. We are not authorized by the Senate nor – because we have discussed this
lengthily on the floor, actually, several months on the floor. And we don’t have the authority as well for
other Bicam members to add a provision to include a separate entity that has already their legal or their
established Republic Act tackling on that particular issue. But we just like to put on record, we sympathize
with the plight of our friends in the condominium associations and we will just guarantee them that we will
work on an amendment to the Condominium Corporation Code. So with that – we skipped, that is correct,
we have to go back to homeowners’ association definition, Your Honor, because we had skipped it
altogether. So just quickly going back to Page 7 because there are amendments to the definition of
homeowners. If it is alright with the House Panel, adopt the opening phrase of Subsection 7 of the Senate
version as opening phrase of Subsection 10 of the reconciled version.

To be sure, RA 4726 or the Condominium Act was enacted to specifically govern a condominium. Said
law sanctions the creation of the condominium corporation which is especially formed for the purpose of
holding title to the common area, in which the holders of separate interests shall automatically be
members or shareholders, to the exclusion of others, in proportion to the appurtenant interest of their
respective units.34 The rights and obligations of the condominium unit owners and the condominium
corporation are set forth in the above Act.

Clearly, condominium corporations are not covered by the amendment. Thus, the intra-corporate dispute
between petitioner and respondent is still within the jurisdiction of the RTC sitting as a special commercial
court and not the HLURB. The doctrine laid down by the Court in Chateau de Baie Condominium
Corporation v. Moreno35 which in turn cited Wack Wack Condominium Corporation, et al v. CA 36 is still a
good law.

WHEREFORE, we hereby GRANT the petition and REVERSE the Court of Appeals Decision dated July
10, 2007 and Resolution dated January 25, 2008 in CA-G.R. CV No. 86614. The Complaint before the
Regional Trial Court of Makati City, Branch 58, which is not a special commercial court, docketed as Civil
Case No. 03-1018 is ordered DISMISSED for lack of jurisdiction. Let the case be REMANDED to the
Executive Judge of the Regional Trial Court of Makati City for re-raffle purposes among the designated
special commercial courts. SO ORDERED.

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G.R. Nos. 160054-55 July 21, 2004 8293, the penalty4 of imprisonment for unfair competition does not exceed six years, the
MANOLO P. SAMSON vs. HON. REYNALDO B. DAWAY (RTC), PEOPLE OF THE offense is cognizable by the Municipal Trial Courts and not by the Regional Trial Court, per
PHILIPPINES and CATERPILLAR, INC R.A. No. 7691.

Assailed in this petition for certiorari is the March 26, 2003 Order1 of the Regional Trial Court of In its assailed March 26, 2003 Order, the trial court denied petitioner’s twin motions.6 A motion
Quezon City, Branch 90, which denied petitioner’s – (1) motion to quash the information; and for reconsideration thereof was likewise denied on August 5, 2003.
(2) motion for reconsideration of the August 9, 2002 Order denying his motion to suspend the
arraignment and other proceedings in Criminal Case Nos. Q-02-108043-44. Petitioner also Hence, the instant petition alleging that respondent Judge gravely abused its discretion in
questioned its August 5, 2003 Order2 which denied his motion for reconsideration. issuing the assailed orders.

The undisputed facts show that on March 7, 2002, two informations for unfair competition The issues posed for resolution are – (1) Which court has jurisdiction over criminal and civil
under Section 168.3 (a), in relation to Section 170, of the Intellectual Property Code (Republic cases for violation of intellectual property rights? (2) Did the respondent Judge gravely abuse
Act No. 8293), similarly worded save for the dates and places of commission, were filed his discretion in refusing to suspend the arraignment and other proceedings in Criminal Case
against petitioner Manolo P. Samson, the registered owner of ITTI Shoes. The accusatory Nos. Q-02-108043-44 on the ground of – (a) the existence of a prejudicial question; and (b) the
portion of said informations read: pendency of a petition for review with the Secretary of Justice on the finding of probable cause
for unfair competition?
That on or about the first week of November 1999 and sometime prior or subsequent
thereto, in Quezon City, Philippines, and within the jurisdiction of this Honorable Court, Under Section 170 of R.A. No. 8293, which took effect on January 1, 1998, the criminal penalty
above-named accused, owner/proprietor of ITTI Shoes/Mano Shoes Manufactuirng for infringement of registered marks, unfair competition, false designation of origin and false
Corporation located at Robinson’s Galleria, EDSA corner Ortigas Avenue, Quezon description or representation, is imprisonment from 2 to 5 years and a fine ranging from Fifty
City, did then and there willfully, unlawfully and feloniously distribute, sell and/or offer Thousand Pesos to Two Hundred Thousand Pesos, to wit:
for sale CATERPILLAR products such as footwear, garments, clothing, bags,
accessories and paraphernalia which are closely identical to and/or colorable SEC. 170. Penalties. – Independent of the civil and administrative sanctions imposed
imitations of the authentic Caterpillar products and likewise using trademarks, symbols by law, a criminal penalty of imprisonment from two (2) years to five (5) years and a
and/or designs as would cause confusion, mistake or deception on the part of the
fine ranging from Fifty thousand pesos (P50,000.00) to Two hundred thousand pesos
buying public to the damage and prejudice of CATERPILLAR, INC., the prior adopter,
(P200,000.00), shall be imposed on any person who is found guilty of committing any
user and owner of the following internationally: "CATERPILLAR", "CAT",
of the acts mentioned in Section 155 [Infringement], Section 168 [Unfair Competition]
"CATERPILLAR & DESIGN", "CAT AND DESIGN", "WALKING MACHINES" and and Section 169.1 [False Designation of Origin and False Description or
"TRACK-TYPE TRACTOR & DESIGN." Representation].

CONTRARY TO LAW.3
Corollarily, Section 163 of the same Code states that actions (including criminal and civil)
under Sections 150, 155, 164, 166, 167, 168 and 169 shall be brought before the proper courts
On April 19, 2002, petitioner filed a motion to suspend arraignment and other proceedings in with appropriate jurisdiction under existing laws, thus –
view of the existence of an alleged prejudicial question involved in Civil Case No. Q-00-41446
for unfair competition pending with the same branch; and also in view of the pendency of a SEC. 163. Jurisdiction of Court. – All actions under Sections 150, 155, 164 and 166 to
petition for review filed with the Secretary of Justice assailing the Chief State Prosecutor’s 169 shall be brought before the proper courts with appropriate jurisdiction under
resolution finding probable cause to charge petitioner with unfair competition. In an Order existing laws. (Emphasis supplied)
dated August 9, 2002, the trial court denied the motion to suspend arraignment and other
proceedings.
The existing law referred to in the foregoing provision is Section 27 of R.A. No. 166 (The
Trademark Law) which provides that jurisdiction over cases for infringement of registered
On August 20, 2002, petitioner filed a twin motion to quash the informations and motion for
marks, unfair competition, false designation of origin and false description or representation, is
reconsideration of the order denying motion to suspend, this time challenging the jurisdiction of
lodged with the Court of First Instance (now Regional Trial Court) –
the trial court over the offense charged. He contended that since under Section 170 of R.A. No.
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SEC. 27. Jurisdiction of Court of First Instance. – All actions under this Chapter [V – decide Intellectual Property Code and Securities and Exchange Commission cases in specific
Infringement] and Chapters VI [Unfair Competition] and VII [False Designation of Regional Trial Courts designated as Special Commercial Courts.
Origin and False Description or Representation], hereof shall be brought before the
Court of First Instance. The case of Mirpuri v. Court of Appeals,10 invoked by petitioner finds no application in the
present case. Nowhere in Mirpuri did we state that Section 27 of R.A. No. 166 was repealed
We find no merit in the claim of petitioner that R.A. No. 166 was expressly repealed by R.A. by R.A. No. 8293. Neither did we make a categorical ruling therein that jurisdiction over cases
No. 8293. The repealing clause of R.A. No. 8293, reads – for violation of intellectual property rights is lodged with the Municipal Trial Courts. The passing
remark in Mirpuri on the repeal of R.A. No. 166 by R.A. No. 8293 was merely a backgrounder
SEC. 239. Repeals. – 239.1. All Acts and parts of Acts inconsistent herewith, more to the enactment of the present Intellectual Property Code and cannot thus be construed as a
particularly Republic Act No. 165, as amended; Republic Act No. 166, as amended; jurisdictional pronouncement in cases for violation of intellectual property rights.
and Articles 188 and 189 of the Revised Penal Code; Presidential Decree No. 49,
including Presidential Decree No. 285, as amended, are hereby repealed. (Emphasis Anent the second issue, petitioner failed to substantiate his claim that there was a prejudicial
added) question. In his petition, he prayed for the reversal of the March 26, 2003 order which
sustained the denial of his motion to suspend arraignment and other proceedings in Criminal
Notably, the aforequoted clause did not expressly repeal R.A. No. 166 in its entirety, otherwise, Case Nos. Q-02-108043-44. For unknown reasons, however, he made no discussion in
it would not have used the phrases "parts of Acts" and "inconsistent herewith;" and it would support of said prayer in his petition and reply to comment. Neither did he attach a copy of the
have simply stated "Republic Act No. 165, as amended; Republic Act No. 166, as amended; complaint in Civil Case No. Q-00-41446 nor quote the pertinent portion thereof to prove the
and Articles 188 and 189 of the Revised Penal Code; Presidential Decree No. 49, including existence of a prejudicial question.
Presidential Decree No. 285, as amended are hereby repealed." It would have removed all
doubts that said specific laws had been rendered without force and effect. The use of the At any rate, there is no prejudicial question if the civil and the criminal action can, according to
phrases "parts of Acts" and "inconsistent herewith" only means that the repeal pertains only to law, proceed independently of each other.11 Under Rule 111, Section 3 of the Revised Rules
provisions which are repugnant or not susceptible of harmonization with R.A. No. on Criminal Procedure, in the cases provided in Articles 32, 33, 34 and 2176 of the Civil Code,
8293.6 Section 27 of R.A. No. 166, however, is consistent and in harmony with Section 163 of the independent civil action may be brought by the offended party. It shall proceed
R.A. No. 8293. Had R.A. No. 8293 intended to vest jurisdiction over violations of intellectual independently of the criminal action and shall require only a preponderance of evidence.
property rights with the Metropolitan Trial Courts, it would have expressly stated so under
Section 163 thereof. In the case at bar, the common element in the acts constituting unfair competition under
Section 168 of R.A. No. 8293 is fraud.12 Pursuant to Article 33 of the Civil Code, in cases of
Moreover, the settled rule in statutory construction is that in case of conflict between a general defamation, fraud, and physical injuries, a civil action for damages, entirely separate and
law and a special law, the latter must prevail. Jurisdiction conferred by a special law to distinct from the criminal action, may be brought by the injured party. Hence, Civil Case No. Q-
Regional Trial Courts must prevail over that granted by a general law to Municipal Trial 00-41446, which as admitted13 by private respondent also relate to unfair competition, is an
Courts.7 independent civil action under Article 33 of the Civil Code. As such, it will not operate as a
prejudicial question that will justify the suspension of the criminal cases at bar.
In the case at bar, R.A. No. 8293 and R.A. No. 166 are special laws8 conferring jurisdiction
over violations of intellectual property rights to the Regional Trial Court. They should therefore Section 11 (c), Rule 116 of the Revised Rules on Criminal Procedure provides –
prevail over R.A. No. 7691, which is a general law.9 Hence, jurisdiction over the instant
criminal case for unfair competition is properly lodged with the Regional Trial Court even if the SEC. 11. Suspension of arraignment. – Upon motion by the proper party, the
penalty therefor is imprisonment of less than 6 years, or from 2 to 5 years and a fine ranging arraignment shall be suspended in the following cases –
from P50,000.00 to P200,000.00.
(c) A petition for review of the resolution of the prosecutor is pending at either the
In fact, to implement and ensure the speedy disposition of cases involving violations of Department of Justice, or the Office of the President; Provided, that the period of
intellectual property rights under R.A. No. 8293, the Court issued A.M. No. 02-1-11-SC dated suspension shall not exceed sixty (60) days counted from the filing of the petition with
February 19, 2002 designating certain Regional Trial Courts as Intellectual Property Courts. the reviewing office.
On June 17, 2003, the Court further issued a Resolution consolidating jurisdiction to hear and
96
While the pendency of a petition for review is a ground for suspension of the arraignment, the
aforecited provision limits the deferment of the arraignment to a period of 60 days reckoned
from the filing of the petition with the reviewing office. It follows, therefore, that after the
expiration of said period, the trial court is bound to arraign the accused or to deny the motion to
defer arraignment.

In the instant case, petitioner failed to establish that respondent Judge abused his discretion in
denying his motion to suspend. His pleadings and annexes submitted before the Court do not
show the date of filing of the petition for review with the Secretary of Justice.14 Moreover, the
Order dated August 9, 2002 denying his motion to suspend was not appended to the petition.
He thus failed to discharge the burden of proving that he was entitled to a suspension of his
arraignment and that the questioned orders are contrary to Section 11 (c), Rule 116 of the
Revised Rules on Criminal Procedure. Indeed, the age-old but familiar rule is that he who
alleges must prove his allegations.

In sum, the dismissal of the petition is proper considering that petitioner has not established
that the trial court committed grave abuse of discretion. So also, his failure to attach
documents relevant to his allegations warrants the dismissal of the petition, pursuant to
Section 3, Rule 46 of the Rules of Civil Procedure, which states:

SEC. 3. Contents and filing of petition; effect of non-compliance with


requirements. — The petition shall contain the full names and actual addresses of all
the petitioners and respondents, a concise statement of the matters involved, the
factual background of the case, and the grounds relied upon for the relief prayed for.

It shall be filed in seven (7) clearly legible copies together with proof of service thereof
on the respondent with the original copy intended for the court indicated as such by the
petitioner, and shall be accompanied by a clearly legible duplicate original or
certified true copy of the judgment, order, resolution, or ruling subject thereof,
such material portions of the record as are referred to therein, and other
documents relevant or pertinent thereto.

The failure of the petitioner to comply with any of the foregoing requirements
shall be sufficient ground for the dismissal of the petition. (Emphasis added)

WHEREFORE, in view of all the foregoing, the petition is dismissed. SO ORDERED.

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