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This summary analyzes a court case regarding a property dispute and issues of jurisdiction. 1. The case involved a complaint for reconveyance of possession filed in the regional trial court regarding a 0.9504-hectare property. However, the court found it did not have jurisdiction as the assessed value of the property was only P11,160, falling under the jurisdiction of the municipal trial court. 2. The Supreme Court ruling granted the petition, set aside the court of appeals decision, and declared the regional trial court's decision null and void for lack of jurisdiction. It noted the assessed value, not estimated value, determines jurisdiction. 3. The court also found the complaint's specified action

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0% found this document useful (0 votes)
58 views41 pages

Pointers

This summary analyzes a court case regarding a property dispute and issues of jurisdiction. 1. The case involved a complaint for reconveyance of possession filed in the regional trial court regarding a 0.9504-hectare property. However, the court found it did not have jurisdiction as the assessed value of the property was only P11,160, falling under the jurisdiction of the municipal trial court. 2. The Supreme Court ruling granted the petition, set aside the court of appeals decision, and declared the regional trial court's decision null and void for lack of jurisdiction. It noted the assessed value, not estimated value, determines jurisdiction. 3. The court also found the complaint's specified action

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You are on page 1/ 41

FINAL EXAMINATION (PART II)

THIS EXAMINATION CALLS FOR ANALYSIS. NO TWO BRAINS


ARE ALIKE.

I. Reconcile:

1. Sections 19 and 33 of B.P. 129 in relation with

CARPIO MORALES, J.: Fernanda Genozon vda. De barrera


and Johnny Oco Jr. vs. Heirs of Vicente Legaspi (G.R. No.
174346 Sept. 12, 2008)

Under review before this Court is the July 31, 2006 Decision of the
Court of Appeals,[1] which affirmed that of the Regional Trial Court,
Branch 16, of Tangub City in Civil Case No. TC-97-001, ordering
the defendants-petitioners herein, Fernanda Geonzon vda. de
Barrera and Johnny Oco. Jr. to return possession of the subject
property to the plaintiffs-herein respondents, Heirs of Vicente
Legaspi.

On October 1, 1996, petitioner Johnny Oco Jr. (Oco), said to be a


"peace officer connected with the PNP," accompanied by
"unidentified CAFGU members," forced his way into respondents'
0.9504-hectare irrigated farmland located at Liloan, Bonifacio,
Misamis Occidental. After dispossessing respondents of the
property, Oco and company used a tractor to destroy the planted
crops, took possession of the land, and had since tended it. [2]

Respondents thus filed on February 7, 1997 a complaint before the


Regional Trial Court of Tangub City for Reconveyance of Possession
with Preliminary Mandatory Injunction and Damages[3] against
petitioners.

In their Answer, petitioners claimed that the subject land forms


part of a three-hectare property described in OCT No. P-447 issued
on February 10, 1956 in the name of Andrea Lacson who sold a 2-
hectare portion thereof to Eleuterio Geonzon who, in turn, sold
1.1148 thereof to his sister petitioner Fernanda Geonzon vda. de
Barrera (Fernanda).[4]

Respondents, on the other hand, asserted that the land was


occupied, possessed and cultivated by their predecessor-in-interest
Vicente Legaspi and his wife Lorenza since 1935;[5] after a
subdivision survey was conducted in November 30, 1976, it was
found out that the land formed part of the titled property of Andrea
Lacson;[6] and despite this discovery, they never filed any action to
recover ownership thereof since they were left undisturbed in their
possession,[7] until October 1, 1996 when petitioners forced their
way into it.
Petitioners raised the issue of ownership as a special affirmative
defense.[8] In their Memorandum, however, they questioned the
jurisdiction of the RTC over the subject matter of the complaint, the
assessed value of the land being only P11,160,[9] as reflected in Tax
Declaration No. 7565.[10]

By Decision of November 27, 1998, the trial court found for


respondents, disposing as follows:
WHEREFORE, judgment is hereby rendered in favor of the plaintiffs
[herein respondents] and against the defendants [-herein
petitioners]:

1. Ordering the latter to return the possession of the land in question


to the plaintiffs and

2. Ordering the latter to desist from further depriving and disturbing


plaintiffs' peaceful possession thereof, unless there be another
court judgment to the contrary.

SO ORDERED.
On the issue of jurisdiction over the subject matter, the trial court,
maintaining that it had, held:
The Court is not persuaded by [the defendants'] arguments. What
determines the nature of the action as well as the jurisdiction of the
[c]ourt are the facts alleged in the complaint and not those alleged
in the answer of the defendants.

xxxx

In [p]ar. 2 of plaintiffs' complaint, the land in question was


described as a riceland "situated at Liloan, Bonifacio, Misamis Occ.
and declared under [T]ax [D]eclaration No. 7564 in the name of
Vicente Legaspi and bounded on the north by a creek, on the east
Sec. 12, on the south Lot No. 007 and on the west also by Lot No.
007 which tax declaration cancels former [T]ax [D]eclaration No.
12933 under the name of Lorenza Bacul Legaspi which likewise
cancels [T]ax [D]eclaration No. 5454 covering the bigger portion of
the land under which the land described under [T]ax [D]eclaration
No. 7565 is part and parcel thereof [sic]; the present estimated
value being P50,000."[11] (Emphasis and underscoring supplied)
Petitioners thereupon appealed to the Court of Appeals which
affirmed the trial court's disposition of the issue of jurisdiction over
the subject matter.

On the merits, the appellate court affirmed too the trial court's
decision, finding that "both testimonial and documentary evidence
on record established that appellees, through their predecessors-in-
interest, have been in peaceful, continuous, public and actual
possession of the property in dispute even before the year
1930."[12]

The appellate court emphasized that in an accion publiciana, the


only issue involved is the determination of possession de jure.[13]

Hence, the present petition for review which raises the following
issues:
I. . . . WHETHER OWNERSHIP AND TITLE CANNOT BE AN ISSUE TO
DETERMINE WHO HAS A BETTER RIGHT [TO] THE PORTION
LITIGATED; AND

II. WHETHER . . . THE NATURE OF THE ACTION AS WELL AS THE


JURISDICTION OF THE COURT DEPEND ON THE FACTS AS
ALLEGED IN THE COMPLAINT.[14]
For obvious reasons, the issue of lack of jurisdiction over the
subject matter shall be first considered.

Section 33 of Batas Pambansa Bilang 129, (the Judiciary


Reorganization Act of 1980), as amended by Republic Act No. 7691
provides for the jurisdiction of metropolitan trial courts, municipal
trial courts and municipal circuit trial courts, to wit:
xxxx

(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
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: Provided, That in cases of land not
declared for taxation purposes, the value of such property shall be
determined by the assessed value of the adjacent lots. (Emphasis,
italics and underscoring supplied)
Before the amendments introduced by Republic Act No. 7691, the
plenary action of accion publiciana was to be brought before the
regional trial court.[15] With the modifications introduced by R.A. No.
7691 in 1994, the jurisdiction of the first level courts has been
expanded to include jurisdiction over other real actions where the
assessed value does not exceed P20,000, P50,000 where the action
is filed in Metro Manila. The first level courts thus have exclusive
original jurisdiction over accion publiciana and accion reivindicatoria
where the assessed value of the real property does not exceed the
aforestated amounts. Accordingly, the jurisdictional element is the
assessed value of the property.

Assessed value is understood to be "the worth or value of property


established by taxing authorities on the basis of which the tax rate
is applied. Commonly, however, it does not represent the true or
market value of the property." [16]

The subject land has an assessed value of P11,160 as reflected in


Tax Declaration No. 7565, a common exhibit of the parties. The
bare claim of respondents that it has a value of P50,000 thus fails.
The case, therefore, falls within the exclusive original jurisdiction of
the municipal trial court.
It was error then for the RTC to take cognizance of the complaint
based on the allegation that "the present estimated value [of the
land is] P50,000," which allegation is, oddly, handwritten on the
printed pleading. The estimated value, commonly referred to as fair
market value,[17] is entirely different from the assessed value of the
property.

Lack of jurisdiction is one of those excepted grounds where the


court may dismiss a claim or a case at any time when it appears
from the pleadings or the evidence on record that any of those
grounds exists, even if they were not raised in the answer or in a
motion to dismiss.[18] That the issue of lack of jurisdiction was
raised by petitioners only in their Memorandum filed before the trial
court did not thus render them in estoppel.

En passant, the Court notes that respondents' cause of action -


accion publiciana is a wrong mode. The dispossession took place on
October 1, 1996 and the complaint was filed four months thereafter
or on February 7, 1997. Respondents' exclusion from the property
had thus not lasted for more than one year to call for the remedy of
accion publiciana.

In fine, since the RTC has no jurisdiction over the complaint filed by
respondents, all the proceedings therein as well as the Decision of
November 27, 1998, are null and void. The complaint should
perforce be dismissed. This leaves it unnecessary to still dwell on
the first issue.

WHEREFORE, the petition is hereby GRANTED. The challenged


July 31, 2006 Decision of the Court of Appeals is SET ASIDE. The
decision of Branch 16 of the Regional Trial Court of Tangub City in
Civil Case No. TC-97-001 is declared NULL and VOID for lack of
jurisdiction.
SO ORDERED.

2.more recent cases like Eversly Childs Sanitarium vs. Sps.


Anastacio Perlabarbarona ( G.R. No. 195814 dated April 4,
2018) which cited a 2007 case stating:

“Although both ejectment and accion publiciana are actions specifically to recover


the right of possession, they have two (2) distinguishing differences. The first is the filing
period. Ejectment cases must be filed within one (I) year from the date of
dispossession. If the dispossession lasts for more than a year, then an accion
publiciana must be filed. The second distinction concerns jurisdiction. Ejectment
cases, being summary in nature, are filed with the Municipal Trial Courts. Accion
publiciana, however, can only be taken cognizance by the Regional Trial Court.”

To answer this: What court has jurisdiction over accion


publiciana and accion reivindicatoria? (10%)

II. What are the possible grounds for dismissing an action


based on a cause of action which should have been raised in a
compulsory counterclaim but was not? Explain thoroughly.
(10%)
III. 1. Does the addition of Section 6 to Rule 7 of the new rules
require that evidentiary matters be stated in the
pleading along with the ultimate facts? (5%)
2. What is the advantage of requiring testimonial,
documentary, and object evidence to be contained in the
pleading, as mandated by Sec. 6 of Rule 7 of the 2019
proposed amendments? (5%)

IV. May actions in personam be filed against defendants who do


not reside and who are not found in the Philippines? (5%)

Consider:a. Sec. 3 Rule 4 which was not amended


b. the Philippines has already acceded to the Hague
Service Convention (Convention on the
Service Abroad of Judicial and Extrajudicial
Documents in Civil and Commercial Matters),

V. From the following cases, draw the rules regarding:

1. distinguishing a real action from a personal action. (5%)


2. jurisdiction over cases relating to real property but
which involve annulment of proceedings or
documents(10%)

1. J. CARPIO: HEIRS OF JUANITA PADILLA, represented by CLAUDIO


PADILLA, vs. DOMINADOR MAGDUA. G.R. No. 176858              
September 15, 2010

The Case

Before the Court is a petition for review on certiorari [1] assailing the
Orders dated 8 September 2006[2] and 13 February 2007[3] of the
Regional Trial Court (RTC) of Tacloban City, Branch 34, in Civil Case
No. 2001-10-161.
2. The Facts

Juanita Padilla (Juanita), the mother of petitioners, owned a piece of


land located in San Roque, Tanauan, Leyte.  After Juanita's death on
23 March 1989, petitioners, as legal heirs of Juanita, sought to have
the land partitioned.  Petitioners sent word to their eldest brother
Ricardo Bahia (Ricardo) regarding their plans for the partition of the
land.  In a letter dated 5 June 1998 written by Ricardo addressed to
them, petitioners were surprised to find out that Ricardo had
declared the land for himself, prejudicing their rights as co-heirs.  It
was then discovered that Juanita had allegedly executed a notarized
Affidavit of Transfer of Real Property[4] (Affidavit) in favor of Ricardo
on 4 June 1966 making him the sole owner of the land.  The records
do not show that the land was registered under the Torrens system.
On 26 October 2001, petitioners filed an action with the RTC of
Tacloban City, Branch 34, for recovery of ownership, possession,
partition and damages.  Petitioners sought to declare void the sale of
the land by Ricardo's daughters, Josephine Bahia and Virginia Bahia-
Abas, to respondent Dominador Magdua (Dominador). The sale was
made during the lifetime of Ricardo.

Petitioners alleged that Ricardo, through misrepresentation, had the


land transferred in his name without the consent and knowledge of
his co-heirs.  Petitioners also stated that prior to 1966, Ricardo had a
house constructed on the land. However, when Ricardo and his wife
Zosima separated, Ricardo left for Inasuyan, Kawayan, Biliran and
the house was leased to third parties.

Petitioners further alleged that the signature of Juanita in the


Affidavit is highly questionable because on 15 May 1978 Juanita
executed a written instrument stating that she would be leaving
behind to her children the land which she had inherited from her
parents.

Dominador filed a motion to dismiss on the ground of lack of


jurisdiction since the assessed value of the land was within the
jurisdiction of the Municipal Trial Court of Tanauan, Leyte.

In an Order dated 20 February 2006,[5] the RTC dismissed the case


for lack of jurisdiction.  The RTC explained that the assessed value of
the land in the amount of P590.00 was less than the amount
cognizable by the RTC to acquire jurisdiction over the case. [6]

Petitioners filed a motion for reconsideration. Petitioners argued that


the action was not merely for recovery of ownership and possession,
partition and damages but also for annulment of deed of sale.  Since
actions to annul contracts are actions beyond pecuniary estimation,
the case was well within the jurisdiction of the RTC.

Dominador filed another motion to dismiss on the ground of


prescription.

In an Order dated 8 September 2006, the RTC reconsidered its


previous stand and took cognizance of the case.  Nonetheless, the
RTC denied the motion for reconsideration and dismissed the case on
the ground of prescription pursuant to Section 1, Rule 9 of the Rules
of Court.  The RTC ruled that the case was filed only in 2001 or more
than 30 years since the Affidavit was executed in 1966.  The RTC
explained that while the right of an heir to his inheritance is
imprescriptible, yet when one of the co-heirs appropriates the
property as his own to the exclusion of all other heirs, then
prescription can set in.  The RTC added that since prescription had
set in to question the transfer of the land under the Affidavit, it would
seem logical that no action could also be taken against the deed of
sale executed by Ricardo's daughters in favor of Dominador.  The
dispositive portion of the order states:
WHEREFORE, premises considered, the order of the Court is
reconsidered in so far as the pronouncement of the Court that it has
no jurisdiction over the nature of the action.  The dismissal of the
action, however, is maintained not by reason of lack of jurisdiction
but by reason of prescription.

SO ORDERED.[7]

Petitioners filed another motion for reconsideration which the RTC


denied in an Order dated 13 February 2007 since petitioners raised no
new issue.

Hence, this petition.

The Issue

The main issue is whether the present action is already barred by 
prescription.

The Court's Ruling

Petitioners submit that the RTC erred in dismissing the complaint on


the ground of prescription.  Petitioners insist that the Affidavit
executed in 1966 does not conform with the requirement of sufficient
repudiation of co-ownership by Ricardo against his co-heirs in
accordance with Article 494 of the Civil Code.  Petitioners assert that
the Affidavit became part of  public records only because it was kept
by the Provincial Assessor's office for real property tax declaration
purposes.  However, such cannot be contemplated by law as a record
or registration affecting real properties.  Petitioners insist that the
Affidavit is not an act of appropriation sufficient to be deemed as
constructive notice to an adverse claim of ownership absent a clear
showing that petitioners, as co-heirs, were notified or had knowledge
of the Affidavit issued by their mother in Ricardo's favor.

Respondent Dominador, on the other hand, maintains that Juanita,


during her lifetime, never renounced her signature on the Affidavit or
interposed objections to Ricardo's possession of the land, which was
open, absolute and in the concept of an owner.  Dominador contends
that the alleged written instrument dated 15 May 1978 executed by
Juanita years before she died was only made known lately and
conveys the possibility of being fabricated.  Dominador adds that the
alleged `highly questionable signature' of Juanita on the Affidavit
was only made an issue after 35 years from the date of the transfer
in 1966 until the filing of the case in 2001.  As a buyer in good faith,
Dominador invokes the defense of acquisitive prescription against
petitioners.

At the outset, only questions of law may be raised in a petition for


review on certiorari under Rule 45 of the Rules of Court.  The factual
findings of the lower courts are final and conclusive and may not be
reviewed on appeal except under any of the following circumstances:
(1) the conclusion is grounded on speculations, surmises or
conjectures; (2) the inference is manifestly mistaken, absurd or
impossible; (3) there is grave abuse of discretion; (4) the judgment
is based on a misapprehension of facts; (5) the findings of fact are
conflicting; (6) there is no citation of specific evidence on which the
factual findings are based; (7) the finding of absence of facts is
contradicted by the presence of evidence on record; (8) the findings
of the Court of Appeals are contrary to those of the trial court;  (9)
the Court of Appeals manifestly overlooked certain relevant and
undisputed facts that, if properly considered, would justify a different
conclusion; (10) the findings of the Court of Appeals are beyond the
issues of the case; and (11) such findings are contrary to the
admissions of both parties.[8]

We find that the conclusion of the RTC in dismissing the case on the
ground of prescription based solely on the Affidavit executed by
Juanita in favor of Ricardo, the alleged seller of the property from
whom Dominador asserts his ownership, is speculative.  Thus, a
review of the case is necessary.

Here, the RTC granted the motion to dismiss filed by Dominador


based on Section 1, Rule 9 of the Rules of Court which states:
Section 1. Defenses and objections not pleaded. - Defenses and
objections not pleaded either in a motion to dismiss or in the answer
are deemed waived.  However, when it appears from the pleadings or
the evidence on record that the court has no jurisdiction over the
subject matter, that there is another action pending between the
same parties for the same cause, or that the action is barred by a
prior judgment or by statute of limitations, the court shall dismiss
the case. (Emphasis supplied)

The RTC explained that prescription had already set in since the
Affidavit was executed on 31 May 1966 and petitioners filed the
present case only on 26 October 2001, a lapse of more than 30
years.  No action could be taken against the deed of sale made in
favor of Dominador without assailing the Affidavit, and the action to
question the Affidavit had already prescribed.

After a perusal of the records, we find that the RTC incorrectly relied
on the Affidavit alone in order to dismiss the case without considering
petitioners' evidence.  The facts show that the land was sold to
Dominador by Ricardo's daughters, namely Josephine Bahia and
Virginia Bahia-Abas, during the lifetime of Ricardo. However, the
alleged deed of sale was not presented as evidence and neither was
it shown that Ricardo's daughters had any authority from Ricardo to
dispose of the land.  No cogent evidence was ever presented that
Ricardo gave his consent to, acquiesced in, or ratified the sale made
by his daughters to Dominador. In its 8 September 2006 Order, the
RTC hastily concluded that Ricardo's daughters had legal personality
to sell the property:
On the allegation of the plaintiffs (petitioners) that Josephine Bahia
and Virginia Bahia-Abas had no legal personality or right to [sell] the
subject property is of no moment in this case.  It should be Ricardo
Bahia who has a cause of action against [his] daughters and not the
herein plaintiffs.  After all, Ricardo Bahia might have already
consented to or ratified the alleged deed of sale.[9]

Also, aside from the Affidavit, Dominador did not present any proof
to show that Ricardo's possession of the land had been open,
continuous and exclusive for more than 30 years in order to establish
extraordinary acquisitive prescription.[10] Dominador merely assumed
that Ricardo had been in possession of the land for 30 years based
on the Affidavit submitted to the RTC.  The petitioners, on the other
hand, in their pleading filed with the RTC for recovery of ownership,
possession, partition and damages, alleged that Ricardo left the land
after he separated from his wife sometime after 1966 and moved to
another place.  The records do not mention, however, whether
Ricardo had any intention to go back to the land or whether Ricardo's
family ever lived there.

Further, Dominador failed to show that Ricardo had the land declared
in his name for taxation purposes from 1966 after the Affidavit was
executed until 2001 when the case was filed.  Although a tax
declaration does not prove ownership, it is evidence of claim to
possession of the land.

Moreover, Ricardo and petitioners are co-heirs or co-owners of the


land.  Co-heirs or co-owners cannot acquire by acquisitive
prescription the share of the other co-heirs or co-owners absent a
clear repudiation of the co-ownership, as expressed in Article 494 of
the Civil Code which states:
Art. 494. x x x No prescription shall run in favor of a co-owner or co-
heir against his co-owners or co-heirs as long as he expressly or
impliedly recognizes the co-ownership.

Since possession of co-owners is like that of a trustee, in order that a


co-owner's possession may be deemed adverse to the cestui que
trust or other co-owners, the following requisites must concur: (1)
that he has performed unequivocal acts of repudiation amounting to
an ouster of the cestui que trust or other co-owners, (2) that such
positive acts of repudiation have been made known to the cestui que
trust or other co-owners, and (3) that the evidence thereon must be
clear and convincing.[11]

In the present case, all three requisites have been met.  After
Juanita's death in 1989, petitioners sought for the partition of their
mother's land.  The heirs, including Ricardo, were notified about the
plan.  Ricardo, through a  letter dated 5 June 1998, notified
petitioners, as his co-heirs, that he adjudicated the land solely for
himself. Accordingly, Ricardo's interest in the land had now become
adverse to the claim of his co-heirs after repudiating their claim of
entitlement to the land.  In Generosa v. Prangan-Valera,[12] we held
that in order that title may prescribe in favor of one of the co-
owners, it must be clearly shown that he had repudiated the claims
of the others, and that they were apprised of his claim of adverse
and exclusive ownership, before the prescriptive period begins to
run.

However, in the present case, the prescriptive period began to run


only from 5 June 1998, the date petitioners received notice of
Ricardo's repudiation of their claims to the land.  Since petitioners
filed an action for recovery of ownership and possession, partition
and damages with the RTC on 26 October 2001, only a mere three
years had lapsed.  This three-year period falls short of the 10-year or
30-year acquisitive prescription period required by law in order to be
entitled to claim legal ownership over the land. Thus, Dominador
cannot invoke acquisitive prescription.

Further, Dominador's argument that prescription began to commence


in 1966, after the Affidavit was executed, is erroneous.  Dominador
merely relied on the Affidavit submitted to the RTC that Ricardo had
been in possession of the land for more than 30 years.  Dominador
did not submit any other corroborative evidence to establish
Ricardo's alleged possession since 1966.  In Heirs of Maningding v.
Court of Appeals,[13]  we held that the evidence relative to the
possession, as a fact, upon which the alleged prescription is based,
must be clear, complete and conclusive in order to establish the
prescription.  Here, Dominador failed to present any other competent
evidence to prove the alleged extraordinary acquisitive prescription
of Ricardo over the land.  Since the property is an unregistered land,
Dominador bought the land at his own risk, being aware as buyer
that no title had been issued over the land.  As a consequence,
Dominador is not afforded protection unless he can manifestly prove
his legal entitlement to his claim.

With regard to the issue of the jurisdiction of the RTC, we hold that
the RTC did not err in taking cognizance of the case.

Under Section 1 of Republic Act No. 7691 (RA 7691),[14] amending


Batas Pambansa Blg. 129, the RTC shall exercise exclusive
jurisdiction on the following actions:
Section 1. Section 19 of Batas Pambansa Blg. 129, otherwise known
as the "Judiciary Reorganization Act of 1980", is hereby amended to
read as follows:
"Sec. 19. Jurisdiction in civil cases. - Regional Trial Courts shall
exercise exclusive original jurisdiction.

"(1) In all civil actions in which the subject of the litigation is


incapable of pecuniary estimation;
"(2)  In all civil actions which involve the title to, or possession of,
real property, or any interest therein, where the assessed value of
the property involved exceeds Twenty Thousand Pesos (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, original jurisdiction over
which is conferred upon the Metropolitan Trial Courts, Municipal Trial
Courts, and Municipal Circuit Trial Courts; x x x

On the other hand, Section 3 of RA 7691 expanded the jurisdiction of


the Metropolitan Trial Courts, Municipal Trial Courts and Municipal
Circuit Trial Courts over all civil actions which involve title to or
possession of real property, or any interest, outside Metro Manila
where the assessed value does not exceed Twenty thousand pesos
(P20,000.00).  The provision states:
Section 3.  Section 33 of the same law is hereby amended to read as
follows:
"Sec. 33.  Jurisdiction of Metropolitan Trial Courts, Municipal Trial
Courts and Municipal Circuit Trial Courts in Civil Cases. - Metropolitan
Trial Courts, Municipal Trial Courts, and Municipal Trial Circuit Trial
Courts shall exercise:

xxx

"(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 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:
Provided, That in cases of land not declared for taxation purposes,
the value of such property shall be determined by the assessed value
of the adjacent lots."

In the present case, the records show that the assessed value of the
land was P590.00 according to the Declaration of Property as of 23
March 2000 filed with the RTC.  Based on the value alone, being way
below P20,000.00, the MTC has jurisdiction over the case. However,
petitioners argued that the action was not merely for recovery of
ownership and possession, partition and damages but also for
annulment of deed of sale.  Since annulment of contracts are actions
incapable of pecuniary estimation, the RTC has jurisdiction over the
case.[15]

Petitioners are correct.  In Singson v. Isabela Sawmill,[16] we held


that:

In 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,
the claim is considered capable of pecuniary estimation, and whether
jurisdiction is in the municipal courts or in the courts of first instance
would depend on the amount of the claim. However, where 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 considered such actions as
cases where the subject of the litigation may not be estimated in
terms of money, and are cognizable by courts of first instance (now
Regional Trial Courts).

When petitioners filed the action with the RTC they sought to recover
ownership and possession of the land by questioning (1) the due
execution and authenticity of the Affidavit executed by Juanita in
favor of Ricardo which caused Ricardo to be the sole owner of the
land to the exclusion of petitioners who also claim to be legal heirs
and entitled to the land, and (2) the validity of the deed of sale
executed between Ricardo's daughters and Dominador.  Since the
principal action sought here is something other than the recovery of
a sum of money, the action is incapable of pecuniary estimation and
thus cognizable by the RTC.  Well-entrenched is the rule that
jurisdiction over the subject matter of a case is conferred by law and
is determined by the allegations in the complaint and the character of
the relief sought, irrespective of whether the party is entitled to all or
some of the claims asserted.[17]

In sum, we find that the Affidavit, as the principal evidence relied


upon by the RTC to dismiss the case on the ground of prescription,
insufficiently established Dominador's rightful claim of ownership to
the land.  Thus, we direct the RTC to try the case on the merits to
determine who among the parties are legally entitled to the land.

WHEREFORE, we GRANT the petition.  We REVERSE AND SET


ASIDE the Orders dated 8 September 2006  and 13 February 2007
of the Regional Trial Court  of Tacloban City, Branch 34 in Civil Case
No. 2001-10-161.

SO ORDERED.

3. CJ Peralta: GENESIS INVESTMENT, INC., CEBU JAYA REALTY INC.,


and SPOUSES RHODORA and LAMBERT LIM 
vs. HEIRS of CEFERINO EBARASABAL, G.R. No. 181622              
November 20, 2013

Before the Court is a petition for review on certiorari under Rule 45 of


the Rules of Court seeking to reverse and set aside the Decision [1]  and
Resolution,[2] dated July 11, 2007 and January 10, 2008, respectively, of the
Court of Appeals (CA) in CA-G.R. CEB-SP No. 01017.

The antecedents of the case are as follows:


On November 12, 2003, herein respondents filed against herein petitioners a
Complaint[3] for “Declaration of Nullity of Documents, Recovery of Shares,
Partition, Damages and Attorney's Fees.” The Complaint was filed with the
Regional Trial Court (RTC) of Barili, Cebu.

On August 5, 2004, herein petitioners filed a Motion to Dismiss [4] contending,


among others, that the RTC has no jurisdiction to try the case on the ground
that, as the case involves title to or possession of real property or any
interest therein and since the assessed value of the subject property does
not exceed P20,000.00 (the same being only P11,990.00), the action falls
within the jurisdiction of the Municipal Trial Court (MTC). [5]

In its Order[6] dated September 29, 2004, the RTC granted petitioners' Motion
to Dismiss, holding as follows:

xxxx

And while the prayer of the plaintiffs for the annulment of documents
qualified the case as one incapable of pecuniary estimation thus, rendering it
cognizable supposedly by the second level courts but considering that
Republic Act No. 7691 expressly provides to cover “all civil actions” which
phrase understandably is to include those incapable of pecuniary estimation,
like the case at bar, this Court is of the view that said law really finds
application here more so that the same case also “involves title to, or
possession of, real property, or any interest therein.” For being so, the
assessed value of the real property involved is determinative of which court
has jurisdiction over the case. And the plaintiffs admitting that the assessed
value of the litigated area is less than P20,000.00, the defendants are correct
in arguing that the case is beyond this Court's jurisdiction. [7]

Respondents filed a Motion for Partial Reconsideration,[8] arguing that their


complaint consists of several causes of action, including one for annulment of
documents, which is incapable of pecuniary estimation and, as such, falls
within the jurisdiction of the RTC.[9]

On March 17, 2005, the RTC issued an Order granting respondents' Motion
for Partial Reconsideration and reversing its earlier Order dated September
29, 2004. The RTC ruled, thus:

On the issue of want of jurisdiction, this court likewise finds to be with merit
the contention of the movants as indeed the main case or the primary relief
prayed for by the movants is for the declaration of nullity or annulment of
documents which unquestionably is incapable of pecuniary estimation and
thus within the exclusive original jurisdiction of this court to try although in
the process of resolving the controversy, claims of title or possession of the
property in question is involved which together with all the other remaining
reliefs prayed for are but purely incidental to or as a consequence of the
foregoing principal relief sought.[10]

Petitioners filed a Motion for Reconsideration,[11] but the RTC denied it in its
Order dated June 23, 2005.
Aggrieved, petitioners filed a petition for certiorari with the CA. However, the
CA dismissed the petition via its assailed Decision dated July 11, 2007,
holding that the subject matter of respondents' complaint is incapable of
pecuniary estimation and, therefore, within the jurisdiction of the RTC,
considering that the main purpose in filing the action is to declare null and
void the documents assailed therein.[12]

Petitioners' Motion for Reconsideration was, subsequently, denied in the CA


Resolution dated January 10, 2008.

Hence, the instant petition for review on certiorari raising the sole issue, to
wit:

Whether or not the Honorable Court of Appeals gravely erred in concluding


that the Regional Trial Court, Branch 60 of Barili, Cebu has jurisdiction over
the instant case when the ALLEGATIONS IN THE COMPLAINT clearly shows
that the main cause of action of the respondents is for the Recovery of their
Title, Interest, and Share over a Parcel of Land, which has an assessed value
of P11,990.00 and thus, within the jurisdiction of the Municipal Trial Court. [13]

The petition lacks merit.

For a clearer understanding of the case, this Court, like the CA, finds it
proper to quote pertinent portions of respondents' Complaint, to wit:

xxxx

1. Plaintiffs are all Filipino, of legal age, surviving descendants – either as


grandchildren or great grandchildren – and heirs and successors-in-interest
of deceased Roman Ebarsabal, who died on 07 September 1952 x x x

xxxx

8. During the lifetime of Roman Ebarsabal, he acquired a parcel of land


situated in Basdaku, Saavedra, Moalboal, Cebu, x x x.

xxxx

with a total assessed value of P2,890.00 x x x. However, for the year 2002,
the property was already having (sic) a total assessed value of P11,990.00 x
x x.

9. Upon the death of said Roman Ebarsabal, his eight (8) children named in
par. 7 above, became co-owners of his above-described property by
hereditary succession; taking peaceful possession and enjoyment of the
same in fee simple pro indiviso, paying the real estate taxes thereon and did
not partition the said property among themselves until all of them likewise
died, leaving, however, their respective children and descendants and/or
surviving heirs and successors-in-interest, and who are now the above-
named plaintiffs herein;

10. The plaintiffs who are mostly residents in (sic) Mindanao and Manila,
have just recently uncovered the fact that on 28th January 1997, the
children and descendants of deceased Gil Ebarsabal, namely: Pelagio,
Hipolito, Precela, Fructuosa, Roberta, Florentino, Erlinda, Sebastian, Cirilo, all
surnamed Ebarsabal, have executed among themselves a Deed of
Extrajudicial Settlement with Sale of Roman Ebarsabal's entire property
described above, by virtue of which they allegedly extrajudicially settled the
same and, for P2,600,000.00 – although only the sum of P950,000.00 was
reflected in their Deed of Sale for reason only known to them, they sold the
whole property to defendants Genesis Investment Inc. represented by co-
defendant Rhodora B. Lim, the wife of Lambert Lim, without the knowledge,
permission and consent of the plaintiffs who are the vendors' co-owners of
the lot in question, x x x.

11. Surprisingly, however, the defendant Genesis managed to have the Tax
Declaration of the property issued in the name of co-defendant Cebu Jaya
Realty Incorporated, a firm which, as already intimated above, is also owned
by Spouses Lambert and Rhodora B. Lim, instead of in the name of Genesis
Investment, Incorporated, which is actually the vendee firm of the lot in
question.

xxxx

Hence, the reason why Cebu Jaya Realty, Incorporated is joined and
impleaded herein as a co-defendant.

12. Without the participation of the plaintiffs who are co-owners of the lot in
question in the proceedings, the aforementioned extrajudicial settlement with
sale cannot be binding upon the plaintiff-co-owners.

13. Further, where as in this case, the other heirs who are the plaintiffs
herein, did not consent to the sale of their ideal shares in the inherited
property, the sale was only to be limited to the pro indiviso share of the
selling heirs.

xxxx

14. By representation, the plaintiffs, are therefore, by law, entitled to their


rightful shares from the estate of the deceased Roman Ebarsabal consisting
of seven (7) shares that would have been due as the shares of seven (7)
other children of Roman Ebarsabal who are also now deceased, namely:
Ceferino, Floro, Leona, Pedro, Isidoro, Julian and Benito, all surnamed
Ebarsabal.

15. The defendants who had prior knowledge of the existence of the other
heirs who are co-owners of the vendors of the property they purchased, had
unlawfully acted in bad faith in insisting to buy the whole property in co-
ownership, only from the heirs and successors-in-interest of deceased Gil
Ebarsabal, who is only one (1) of the eight (8) children of deceased Roman
Ebarsabal, and without notifying thereof in whatever manner the plaintiffs
who are the heirs and successors-in-interest of the other co-owners of the
property-in-question; thus, have compelled the plaintiffs herein to file this
instant case in court to protect their interests, x x x.

xxxx

PRAYER

WHEREFORE, in view of all the foregoing, it is most respectfully prayed of


this Honorable Court that, after due notice and hearing, judgment shall be
rendered in favor of the plaintiffs, as follows, to wit:

1 – Declaring as null and void and not binding upon the plaintiffs, the
following documents to wit:

(a) Deed of Extrajudicial Settlement with Sale executed by and between the
heirs of deceased Gil Ebarsabal headed by Pedro Ebarsabal, and Genesis
Investment, Inc., represented by Rhodora Lim, dated 28th of January, 1997,
marked as Annex-A;

(b) Memorandum of Agreement executed between Pedro Ebarsabal and


Genesis Investment, Inc., represented by Rhodora Lim dated 27 January,
which document is notarized;

(c) Tax Declaration of Real Property issued to Cebu Jaya Realty, Inc., marked
as Annex-D;

2 – Ordering the defendants to make partition of the property in litigation


with the plaintiffs into eight (8) equal shares; to get one (1) share thereof,
which is the only extent of what they allegedly acquired by purchase as
mentioned above, and to transfer, restore or reconvey and deliver to the
plaintiffs, seven (7) shares thereof, as pertaining to and due for the latter as
the heirs and successors-in-interest of the seven (7) brothers and sister of
deceased Gil Ebarsabal already named earlier in this complaint;

xxxx

Further reliefs and remedies just and equitable in the premises are also
herein prayed for.

x x x x[14]

It is true that one of the causes of action of respondents pertains to the title,
possession and interest of each of the contending parties over the contested
property, the assessed value of which falls within the jurisdiction of the MTC.
However, a complete reading of the complaint would readily show that,
based on the nature of the suit, the allegations therein, and the reliefs
prayed for, the action is within the jurisdiction of the RTC.

As stated above, it is clear from the records that respondents' complaint was
for "Declaration of Nullity of Documents, Recovery of Shares, Partition,
Damages and Attorney's Fees." In filing their Complaint with the RTC,
respondents sought to recover ownership and possession of their shares in
the disputed parcel of land by questioning the due execution and validity of
the Deed of Extrajudicial Settlement with Sale as well as the Memorandum of
Agreement entered into by and between some of their co-heirs and herein
petitioners.  Aside from praying that the RTC render judgment declaring as
null and void the said Deed of Extrajudicial Settlement with Sale and
Memorandum of Agreement, respondents likewise sought the following: (1)
nullification of the Tax Declarations subsequently issued in the name of
petitioner Cebu Jaya Realty, Inc.; (2) partition of the property in litigation;
(3) reconveyance of their respective shares; and (3) payment of moral and
exemplary damages, as well as attorney's fees, plus appearance fees.

Clearly, this is a case of joinder of causes of action which comprehends more


than the issue of partition of or recovery of shares or interest over the real
property in question but includes an action for declaration of nullity of
contracts and documents which is incapable of pecuniary estimation. [15]

As cited by the CA, this Court, in the case of Singson v. Isabela Sawmill,[16]
held that:

In 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, the claim is considered capable
of pecuniary estimation, and whether jurisdiction is in the municipal courts or
in the courts of first instance would depend on the amount of the claim.
However, where 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 considered such
actions as cases where the subject of the litigation may not be estimated in
terms of money, and are cognizable by courts of first instance [now Regional
Trial Courts].[17]

This rule was reiterated in Russell v. Vestil[18] and Social Security System v.
Atlantic Gulf and Pacific Company of Manila, Inc.[19]

Contrary to petitioners' contention, the principal relief sought by petitioners


is the nullification of the subject Extrajudicial Settlement with Sale entered
into by and between some of their co-heirs and respondents, insofar as their
individual shares in the subject property are concerned. Thus, the recovery of
their undivided shares or interest over the disputed lot, which were included
in the sale, simply becomes a necessary consequence if the above deed is
nullified. Hence, since the principal action sought in respondents' Complaint
is something other than the recovery of a sum of money, the action is
incapable of pecuniary estimation and, thus, cognizable by the RTC. [20] Well
entrenched is the rule that jurisdiction over the subject matter of a case is
conferred by law and is determined by the allegations in the complaint and
the character of the relief sought, irrespective of whether the party is entitled
to all or some of the claims asserted.[21]

Moreover, it is provided under Section 5 (c), Rule 2 of the Rules of Court that
where the causes of action are between the same parties but pertain to
different venues or jurisdictions, the joinder may be allowed in the RTC
provided one of the causes of action falls within the jurisdiction of said court
and the venue lies therein. Thus, as shown above, respondents' complaint
clearly falls within the jurisdiction of the RTC.

WHEREFORE, the petition is DENIED. The Decision and Resolution dated


July 11, 2007 and January 10, 2008, respectively, of the Court of Appeals in
CA-G.R. CEB-SP No. 01017 are AFFIRMED.

SO ORDERED.

4. DEL CASTILLO, J. Sps. Claudio and Carmencita Trayvilla vs.


Bernardo Sejas et al. G.R. No. 204970 Feb. 1, 2016

Assailed in this Petition for Review on Certiorari[1] are the following


dispositions of the Court of Appeals (CA): 1) November 29, 2011 Decision [2]
in CA-G.R. SP No. 02315 which granted respondents' Petition for Certiorari
and nullified the September 3, 2007[3] and February 21, 2008[4] Orders of
Branch 18 of the Regional Trial Court (RTC), 9 th Judicial Region, Pagadian
City in Civil Case No. 4633-2K5; and 2) November 19, 2012 Resolution [5]
denying the petitioners' motion for reconsideration.

Factual Antecedents

In 2005, petitioners Claudio and Carmencita Trayvilla instituted before the


RTC Civil Case No. 4633-2K5 against respondent Bernardo Sejas (Sejas). In
their Complaint[6] for specific performance and damages, petitioners claimed
among others that Sejas was the registered owner of a 434-square meter
parcel of land in Tukuran, Zamboanga del Sur covered by Transfer Certificate
of Title No. T-8,337[7] (TCT T-8,337); that by virtue of a private handwritten
document,[8] Sejas sold said parcel of land to them in 1982; that thereafter,
they took possession of the land and constructed a house thereon; that they
resided in said house and continued to reside therein; that Sejas later
reasserted his ownership over said land and was thus guilty of fraud and
deceit in so doing; and that they caused the annotation of an adverse claim.
They prayed that Sejas be ordered to execute a final deed of sale over the
property and transfer the same to them, and that they be awarded the sum
of P30,000.00 as attorney's fees plus P1,500.00 per court appearance of
counsel.

In an Amended Complaint,[9] this time for specific performance,


reconveyance, and damages, petitioners impleaded respondent Juvy
Paglinawan (Paglinawan) as additional defendant, claiming that Sejas
subsequently sold the subject property to her, after which she caused the
cancellation of TCT T-8,337 and the issuance of a new title - TCT T-46,627 -
in her name. Petitioners prayed that Sejas be ordered to execute a final deed
of sale in their favor and transfer the property to them; that Paglinawan's
TCT T-46,627 be canceled and the property be reconveyed to them; and that
they be awarded P50,000.00 in moral damages, in addition to the
P30,000.00 attorney's fees and P1,500.00 per court appearance of counsel
originally prayed for in the Complaint.

However, the additional docket fees for the moral damages prayed for in the
Amended Complaint were not paid.[10] Likewise, for the additional causes of
action, no docket fees were charged and paid.
Respondents moved for dismissal of the case, claiming lack of jurisdiction
over the subject matter and prescription. The RTC denied the motion in a
September 3, 2007 Order.[11]

Respondents filed a Motion for Reconsideration,[12] arguing that petitioners'


case was not for specific performance but was in reality a real action or one
involving title to and possession of real property, in which case the value of
the property should be alleged in the complaint in order that the proper filing
fee may be computed and paid; that since the value of the land was not
alleged in the Amended Complaint, the proper filing fee was not paid, and for
this reason the case should be dismissed; and that petitioners' cause of
action is barred by prescription since the 10-year period to sue upon the
handwritten contract - counted from their purchase of the land in 1982 - had
already lapsed when they filed the case in 2005. However, in a February 21,
2008 Order,[13] the RTC denied the motion, stating among others that
petitioners' case is not a real action but indeed one for specific performance
and thus one which is incapable of pecuniary estimation.

Ruling of the Court of Appeals

Respondents filed an original Petition for Certiorari[14] before the CA, which
was docketed as CA-G.R. SP No. 02315, On November 29, 2011, the CA
issued the assailed Decision, which contained the following pronouncement:
The petition is meritorious.

Jurisdiction is defined as the authority to hear and determine a cause or the


right to act in a case. In addition to being conferred by the Constitution and
the law, the rule is settled that a court's jurisdiction over the subject matter
is determined by the relevant allegations in the complaint, the law in effect
when the action is filed, and the character of the relief sought irrespective of
whether the plaintiff is entitled to all or some of the claims asserted.

Consistent with Section 1, Rule 141 of the Revised Rules of Court which
provides that the prescribed fees shall be paid in full "upon the filing of the
pleading or other application which initiates an action or proceeding", the
well-entrenched rule is to the effect that a court acquires jurisdiction over a
case only upon the payment of the prescribed filing and docket fees.

Rule 141 of the Rules of Court, as amended by A.M. No. 04-2-G4-SC and
Supreme Court Amended Administrative Circular No. 35-2004, provides that:
SEC. 7. Clerks of Regional Trial Courts. -
 
(a) For filing an action or a permissive OR COMPULSORY counterclaim,
CROSSCLAIM, or money claim against an estate not based on judgment,
or for filing a third-party, fourth-party, etc. complaint, or a complaint-in-
intervention, if the total sum claimed, INCLUSIVE OF INTERESTS,
PENALTIES, SURCHARGES, DAMAGES OF WHATEVER KIND, AND
ATTORNEY'S FEES, LITIGATION EXPENSES AND COSTS and/or in cases
involving property, the FAIR MARKET value of the REAL property in
litigation STATED IN THE CURRENT TAX DECLARATION OR CURRENT
ZONAL VALUATION OF THE BUREAU OF INTERNAL REVENUE,
WHICHEVER IS HIGHER, OR IF THERE IS NONE, THE STATED VALUE OF
THE PROPERTY IN LITIGATION OR THE VALUE OF THE PERSONAL
PROPERTY IN LITIGATION X X X AS ALLEGED BY THE CLAIMANT, is:

[Table of fees omitted.]


If the action involves both a money claim and relief pertaining to property,
then THE fees will be charged on both the amounts claimed and value of
property based on the formula prescribed in this paragraph a.

(b) For filing:

1. Actions where the value of the subject matter cannot be estimated

2. Special civil actions, except judicial foreclosure of mortgage,


EXPROPRIATION PROCEEDINGS, PARTITION AND QUIETING OF
TITLE which will [sic]

3. All other actions not involving property [Table of fees omitted.]

The docket fees under Section 7(a), Rule 141, in cases involving real
property depend on the fair market value of the same: the higher the value
of the real property, the higher the docket fees due. In contrast, Section 7(b)
(1), Rule 141 imposes a fixed or flat rate of docket fees on actions incapable
of pecuniary estimation.

xxxx

As can be gleaned from the records, the Amended Complaint was styled as
one for 'Specific Performance and Damages,' whereby private respondents [15]
sought to compel petitioner Sejas to execute fee deed of sale over the
subject land in their favor on the premise that they bought the said land from
petitioner Sejas through a private document. They declared themselves to be
the true and real owners of the subject land and had in fact taken possession
over it to the exclusion of others including petitioner Sejas.

While it may appear that the suit filed is one for specific performance, hence
an aption incapable of pecuniary estimation, a closer look at the allegations
and reliefs prayed for in the Complaint, however, shows that private
respondents were not merely seeking the execution of the deed of sale in
their favor. They were also asking the lower court earnestly to cancel TCT
No. T-46,627 which was allegedly issued to petitioner Paglinawan through
fraudulent means and have the same reconveyed to them as the owners of
the subject land, The ultimate purpose then of private respondents in filing
the complaint before the RTC is to secure their vaunted ownership and title
to the subject land which they claimed was purchased from petitioner Sejas.
Their cause of action clearly springs from their right as purchaser of the
subject land, Under these circumstances, the suit before the RTC is a real
action, affecting as it did title to the real property sought to be reconveyed. A
real action is one in which the plaintiff seeks the recovery of real property;
or, as indicated in what is now Section 1, Rule 4 of the Rules of Court, a real
action is an action affecting title to or recovery of possession of real property.
Section 7, Rule 141 of the Rules of Court, prior to its amendment by A.M. No.
04-2-04-SC, had a specific paragraph governing the assessment of the
docket fees for real action, to wit:
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.
But it is important to note that, with the amendments introduced by A.M. No.
04-2-04-SC, which became effective on 16 August 2004, the paragraph in
Section 7, Rule 141 of the Rules of Court, pertaining specifically to the basis
for the computation of docket fees for real actions was deleted. Instead,
Section 7(1) of Rule 141, as amended, provides that 'in cases involving real
property, the FAIR MARKET value of the REAL property in litigation STATED
IN THE CURRENT TAX DECLARATION OR CURRENT ZONAL VALUATION OF
THE BUREAU OF INTERNAL REVENUE, WHICH [sic] IS HIGHER, OR IF THERE
IS NONE, THE STATED VALUE OF THE PROPERTY IN LITIGATION x x x' shall
be the basis for the computation of the docket fees.

Unfortunately, private respondents never alleged in their Amended


Complaint, much less in the prayer portion thereof, the fair market value of
the subject res as stated in the Tax Declaration or current zonal valuation of
the Bureau of Internal Revenue, which [sic] is higher, or if there is none, the
stated value thereof, to serve as basis for the receiving clerk in computing
and arriving at the proper amount of filing fee due? thereon. In the absence
of such allegation, it cannot be determined whether the RTC or the MTC has
original and exclusive jurisdiction over the petitioners' action. There is
therefore no showing on the face of the complaint that the RTC has exclusive
jurisdiction over the action of the private respondents. Hence, the RTC erred
in taking cognizance of the case despite private respondents' non-payment of
the correct docket fees which must be computed in accordance with Section
7(1), Rule 141 of the Rules of Court, as amended.

The consistent rule is that 'a case is deemed filed only upon payment of the
docket fee regardless of the actual date of filing in court,' and that
jurisdiction over any case is acquired only upon the payment of the
prescribed docket fee which is both mandatory and jurisdictional. x x x

xxxx

This case at bench bears similarity to Gochan v. Gochan,[16] where the


Supreme Court held that although the caption of the complaint filed by
therein respondents Mercedes Gochan, et al. with the RTC was denominated
as one for 'specific performance and damages,' the relief sought was the
conveyance or transfer of real property, or ultimately, the execution of deeds
of conveyance in their favor of the real properties enumerated in the
provisional memorandum of agreement. Under these circumstances, the case
before the RTC was actually a real action, affecting as it did title to or
possession of real property. Consequently, the basis for determining the
correct docket fees shall be the assessed value of the property, or the
estimated value thereof as alleged in the complaint. But since Mercedes
Gochan failed to allege in their complaint the value of the real properties, the
Court found that the RTC did not acquire jurisdiction over the same for non-
payment of the correct docket fees.

More to the point is Huguete v. Embudo,[17] There, petitioners argued that a


complaint for annulment of a deed of sale and partition is incapable of
pecuniary estimation, and thus falls within the exclusive jurisdiction of the
RTC. However, the Supreme Court ruled that 'the nature of an action is not
determined by what is stated in the caption of the complaint but by the
allegations of the complaint and the reliefs prayed for. Where the ultimate
objective of the plaintiffs, like petitioners herein, is to obtain title to real
property, it should be filed in the proper court having jurisdiction over the
assessed value of the property subject thereof.'

Likewise, in Siapno v. Manalo,[18] the Supreme Court disregarded the


title/denomination of therein plaintiff Manalo's amended petition as one for
Mandamus with Revocation of Title and Damages; and adjudged the same to
be a real action, the filing fees for which should have been computed based
on the assessed value of the subject property or, if there was none, the
estimated value thereof. x x x

xxxx

In fine, We rule and so hold that the RTC never acquired jurisdiction over
Civil Case No. 4633-2K5, hence, its act of taking cognizance of the subject
Complaint was tainted with grave abuse of discretion amounting to lack or
excess of jurisdiction. Grave abuse of discretion is defined as capricious and
whimsical exercise of judgment as is equivalent to lack of jurisdiction.

Given the foregoing, this Court finds it unnecessary to dwell on the issue of
prescription raised by petitioners.

WHEREFORE, premises considered, the instant Petition is hereby GRANTED.


The Orders dated 03 September 2007 and 21 February 2008, respectively, of
the Regional Trial Court (RTC), 9th Judicial Region, Branch 18, Pagadian City,
are DECLARED NULL and VOID for having been issued without jurisdiction,
The Amended Complaint filed [sic] private respondents docketed as Civil
Case No. 4633-2K5 is hereby DISMISSED.

SO ORDERED.[19]
Petitioners filed a Motion for Reconsideration,[20] which the CA denied in its
assailed November 19, 2012 Resolution. Hence, the present Petition.

In a March 19, 2014 Resolution,[21] the Court resolved to give due course to
the instant Petition.

Issues

Petitioners raise the following issues:


1. Did the Court of Appeals ruled [sic] correctly when it dismissed the
complaint by reason of Petitioner-Appellants' alleged non-payment of the
correct dockets [sic] fees due to its [sic] failure to alleged [sic] the fair
market value or the stated value of the subject property in the amended
complaint?

2. Did the filing of the amended complaint sufficiently divested [sic] and
ousted [sic] the trial court of its jurisdiction over the case that had initially
validly attached by virtue of the Original complaint for specific performance?
[22]

Petitioners' Arguments

In praying that the assailed CA dispositions be set aside and that their
Amended Complaint in Civil Case No. 4633-2K5 be reinstated, petitioners
contend in their Petition and Reply[23] that it was error for the CA to order the
dismissal of their Amended Complaint simply because additional causes of
action were alleged and new reliefs were prayed for, and the additional
docket fees therefor were not paid; that while reconveyance was sought in
the Amended Complaint, the principal action was still for specific
performance, and the reconveyance prayed for was merely incidental
thereto; that since the trial court acquired jurisdiction over the case with the
filing of the original Complaint, it did not lose the same as a result of the
filing of the Amended Complaint; that jurisdiction continued to attach even
with the submission of the Amended Complaint; that their failure to pay the
additional docket fees required for the Amended Complaint does not result in
loss of jurisdiction over the case - instead, the Amended Complaint is simply
not admitted and the original Complaint remains;[24] that instead of
dismissing the case, the Amended Complaint should have been disregarded,
or petitioners should have been ordered to pay the deficiency in docket fees
within a reasonable period of time; that "the rule now is that the court may
allow a reasonable time for the payment of the prescribed fees, or the
balance thereof, and upon such payment, the defect is cured and the court
may properly take cognizance of the action, unless in the meantime
prescription has set in and consequently barred the right of action;" [25] and
that the rules of procedure should be liberally applied in their case, as there
is no intention to evade the payment of additional docket fees, as is shown
by the payment of the original filing fees when the case was instituted.

Respondents' Arguments

Respondents, on the other hand, argue in their Comment [26] that the CA was
correct in ruling that Civil Case No. 4633-2K5 should be dismissed; that while
the complaint is for specific performance, the relief prayed for includes
reconveyance, which is a real action - in which case the assessed value of the
property should have been alleged for the proper computation of the docket
fees. Thus, they pray for the denial of the Petition, with double costs against
petitioners.

Our Ruling

The Court denies the Petition.

As correctly ruled by the CA, while petitioners' Amended Complaint was


denominated as one mainly for specific performance, they additionally prayed
for reconveyance of the property, as well as the cancellation of Paglinawan's
TCT T-46,627. In other words, petitioners' aim in filing Civil Case No. 4633-
2K5 was to secure their claimed ownership and title to the subject property,
which qualifies their case as a real action. Pursuant to Section 1, Rule 4 of
the 1997 Rules of Civil Procedure,[27] a real action is one that affects title to
or possession of real property, or an interest therein.

Since Civil Case No. 4633-2K5 is a real action made so by the Amended
Complaint later filed, petitioners should have observed the requirement
under A.M. No. 04-2-04-SC[28] relative to declaring the fair market value of
the property as stated in the current tax declaration or zonal valuation of the
Bureau of Internal Revenue (BIR), Since no such allegation was made in the
Amended Complaint, then the value of the subject property as stated in the
handwritten document sued upon and restated in the Amended Complaint
should be the basis for determining jurisdiction and the amount of docket
fees to be paid.

The CA is correct in its general observation that in the absence of the


required declaration of the fair market value as stated in the current tax
declaration or zonal valuation of the property, it cannot be determined
whether the RTC or first level court has original and exclusive jurisdiction
over the petitioners' action, since the jurisdiction of these courts is
determined on the basis of the value of the property. Under applicable rules,
Jurisdiction of RTCs, as may be relevant to the instant petition, is provided in
Sec. 19 of BP 129,[29] which reads;
Sec. 19. Jurisdiction in civil cases. — Regional Trial Courts shall exercise
exclusive original jurisdiction:

1) In all civil actions in which the subject of the litigation is incapable of


pecuniary estimation;

2) In all civil actions which involve the title to, or possession of, real
property, or any interest therein, where the assessed value of the property
involved exceeds Twenty thousand pesos (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, original jurisdiction over which is conferred upon the Metropolitan
Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts.
On the other hand, jurisdiction of first level courts is prescribed in Sec. 33 of
BP 129, which provides:
Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and
Municipal Circuit Trial Courts in civil cases.—Metropolitan Trial Courts,
Municipal Trial Courts, and Municipal Circuit Trial Courts shall exercise:

xxxx

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 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: Provided, That in cases of land not declared for taxation purposes, the
value of such property shall be determined by the assessed value of the
adjacent lots.[30]
However, the CA failed to consider that in determining jurisdiction, it could
rely on the declaration made in the Amended Complaint that the property is
valued at P6,000.00. The handwritten document sued upon and the
pleadings indicate that the property was purchased by petitioners for the
price of P6,000.00. For purposes of filing the civil case against respondents,
this amount should be the stated value of the property in the absence of a
current tax declaration or zonal valuation of the BIR. Rule 141 of the Rules of
Court, as amended by A.M. No. 04-2-04-SC and Supreme Court Amended
Administrative Circular No. 35-2004, provides that -
a) For filing an action or a permissive OR COMPULSORY counterclaim,
CROSS-CLAIM, or money claim against an estate not based on judgment, or
for filing a third-party, fourth-party, etc. complaint, or a complaint-in-
intervention, if the total sum claimed, INCLUSIVE OF INTERESTS,
PENALTIES, SURCHARGES, DAMAGES OF WHATEVER KIND, AND
ATTORNEY'S FEES, LITIGATION EXPENSES AND COSTS and/or in cases
involving property, the FAIR MARKET value of the REAL property in litigation
STATED IN THE CURRENT TAX DECLARATION OR CURRENT ZONAL
VALUATION OF THE BUREAU OF INTERNAL REVENUE, WHICHEVER IS
HIGHER, OR IF THERE IS NONE, THE STATED VALUE OF THE
PROPERTY IN LITIGATION OR THE VALUE OF THE PERSONAL PROPERTY
IN LITIGATION AS ALLEGED BY THE CLAIMANT x x x (Emphasis supplied)
shall be the basis for the computation of the docket fees to be paid. Since the
value of the subject property as stated in the Amended Complaint is just
P6,000.00, then the RTC did not have jurisdiction over petitioners' case in
the first instance; it should have dismissed Civil Case No. 4633-2K5. But it
did not. In continuing to take cognizance of the case, the trial court clearly
committed grave abuse of discretion.

WHEREFORE, the Petition is DENIED, The assailed November 29, 2011


Decision and November 19, 2012 Resolution of the Court of Appeals in CA-
G.R. SP No. 02315 are AFFIRMED.

SO ORDERED.

5. ALONA G. ROLDAN vs. SPOUSES CLARENCE I. BARRIOS and ANNA


LEE T. BARRIOS, ROMMEL MATORRES, and HON. JEMENA ABELLAR
ARBIS, in her capacity as Presiding Judge, Branch 6, Regional Trial Court,
Aldan. APRIL 23, 2018 G.R. No. 214803

Before us is a petition for certiorari assailing the Order[1] dated July 22, 2014
issued by the Regional Trial Court (RTC), Branch 6, Kalibo, Aklan as well as
the Order[2] dated August 18, 2014 denying reconsideration thereof.

The antecedent facts are as follows:

On February 3, 2014, petitioner Alona G. Roldan filed an action[3] for


foreclosure of real estate mortgage against respondents spouses Clarence I.
Barrios and Anna Lee T. Barrios and respondent Romel D. Matorres, docketed
as Civil Case No. 9811. She alleged the following:
x x x x

2. That on October 13, 2008, defendants borrowed from plaintiff the sum of
Two Hundred Fifty Thousand Pesos (P250,000.00), Philippine Currency,
payable within the period of one (1) year from said date, with an interest
thereon at the rate of 5% per month; and to secure the prompt and full
payment of the principal and interest, defendants made and executed on
October 13, 2008 a Deed of Real Estate Mortgage in favor of plaintiff upon a
parcel of land and improvements thereon described as follows:

A parcel of land (Lot 5891-A-4) situated in Baybay, Makato, Aklan, containing


an area of four hundred seventy-eight (478) square meters, more or less x x
x declared in the name of Spouses Clarence Barrios and Anna Lee T. Barrios,
assessed in the sum of P13,380.00, tax effectivity for the year 2008. Said
land is covered by OCT No. P-5561 pt.

x x x

3. That the condition of said mortgage, as stated therein, is such, that if


within the period of one year from October 13, 2008, the defendants shall
pay or cause to be paid to the plaintiff, her heirs and assigns, the said sum of
P250,000.00 together with the agreed interest, then the said mortgage shall
be discharged; otherwise, it shall remain in full force and effect, to be
enforceable in the manner provided by law.

4. That the time for payment of said loan is overdue and defendants failed
and refused to pay both the principal obligation and the interest due starting
from February 2011 to the present notwithstanding repeated demands;

5. That there are no other persons having or claiming interest in the


mortgaged property except Romel D. Matorres whom plaintiff recently
discovered that the defendants mortgaged again to the said person the same
property subject of this suit for One Hundred Fifty Thousand Pesos,
(P150,000.00) on June 11, 2012 x x x The said Romel D. Matorres is
however a mortgagee in bad faith.

WHEREFORE, it is respectfully prayed that upon due notice and hearing,


judgment be rendered ordering defendants SPS. CLARENCE I. BARRIOS and
ANNA LEE T. BARRIOS:
1. To pay unto the court within the reglementary period of ninety days the
sum of P250,000.00 together with the stipulated interest at five percent
(5%) per month starting from February 2011 to the present, plus the
additional sum of P25,000.00 the total amount due for attorney's fees;
litigation expenses and costs; and that in default of such payment, the
above-mentioned property be ordered sold to pay off the mortgage debt and
its accumulated interest;

2. To teach the defendants a lesson for having mortgaged the property


subject of this suit without plaintiffs consent or knowledge, the defendants be
ordered to pay the plaintiff the sum of P50,000.00 as exemplary damages.

3. That plaintiff be granted such other relief in law and equity. [4]
Respondents spouses Barrios filed their Answer[5] with Special and Affirmative
Defenses contending that the computation of their alleged loan obligation
was not accurate; that they had filed with the RTC a petition for rehabilitation
of a financially distressed individuals under Special Proceeding No. 9845,
thus there is a need to suspend the foreclosure proceedings. On the other
hand, respondent Matorres filed his Answer [6] with Special and Affirmative
Defenses admitting that the subject land was mortgaged to him; that he had
also filed a judicial foreclosure case against respondents spouses Barrios
pending with the RTC of Kalibo Aklan, Branch 6, docketed as Civil Case No.
9642; that petitioner had no cause of action against him as they did not have
any transaction with each other; and prayed for damages and attorney's
fees, and cross-claim against respondent spouses for moral damages.

On July 22, 2014, the RTC issued the assailed Order as follows:
Civil Cases Nos. 9642 and 9811 are complaints for Foreclosure of Real Estate
Mortgage that involved the same property, Lot 5891-A-4, situated in Baybay,
Makato, Aklan, owned by Spouses Clarence Barrios and Anna Lee Barrios.

It appearing from the complaint that the assessed value of the property
mortgaged is only P13,380.00 and the instant cases being a real action, the
assessed value of the property determines the jurisdiction.

The assessed value of the property involved being below P20,000.00, it is the
first level court that has jurisdiction over the cases.

Premises considered, for lack of jurisdiction, Civil Cases Nos. 9642 and 9811
are ordered DISMISSED without prejudice.

SO ORDERED.[7]
Petitioner and respondent Matorres filed their respective motions for
reconsideration.

In an Order dated August 18, 2014, the RTC denied petitioner's motion as
follows:
xxxx

Petitioner in her Motion argued that foreclosure of real estate mortgage is an


action incapable of pecuniary estimation and jurisdiction lies with the
Regional Trial Court.

Petitioner's argument is devoid of merit.

A petition for foreclosure of real estate mortgage is a real action and the
assessed value of the property determines jurisdiction while location of the
property determines the venue.

Premises considered, the Motion for Reconsideration is DENIED for lack of


merit.
SO ORDERED.[8]
Respondent Matorres' motion for reconsideration was also denied in an
Order[9] dated September 1, 2014.

Petitioner filed the instant petition for certiorari alleging grave abuse of
discretion committed by the RTC when it ordered the dismissal of her
foreclosure case without prejudice and denying her motion for
reconsideration. She argues that foreclosure of mortgage is an action
incapable of pecuniary estimation which is within the exclusive jurisdiction of
the RTC.

In his Comment, respondent Matorres joins the position and arguments of


petitioner that the cause of action of the foreclosure cases is incapable of
pecuniary estimation, hence, falling within the jurisdiction of the RTC.

Respondents spouses Barrios filed their Explanation and Comment alleging


that petitioner violated the Tax Reform Act of 1997 for her failure to issue
official receipts on the payments made by them; that she failed to show any
proof of authority from the Bangko Sentral ng Pilipinas relative to her money-
lending activities.

The issue for resolution is whether the RTC committed grave abuse of
discretion in dismissing the foreclosure cases filed with it on the ground of
lack of jurisdiction.

Preliminarily, we need to point out that generally a direct recourse to this


Court is highly 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 have concurrent jurisdiction to issue writs of
certiorari, prohibition, mandamus, quo warranto, habeas corpus and
injunction, such concurrence does not give the petitioner unrestricted
freedom of choice of court forum. This Court is a court of last resort, and
must so remain if it is to satisfactorily perform the functions assigned to it by
the Constitution and immemorial tradition.[10] However, the judicial hierarchy
of courts is not an iron-clad rule. A strict application of the rule of hierarchy
of courts is not necessary when the cases brought before the appellate courts
do not involve factual but legal questions. [11] Since petitioner raises a pure
question of law pertaining to the court's jurisdiction on complaint for judicial
foreclosure of sale, we would allow petitioner's direct resort to us.

The RTC dismissed the foreclosure cases finding that being a real action and
the assessed value of the mortgaged property is only P13,380.00, it is the
first level court which has jurisdiction over the case and not the RTC.

Jurisdiction over the subject matter is the power to hear and determine cases
of the general class to which the proceedings in question belong. It is
conferred by law and an objection based on this ground cannot be waived by
the parties.[12] To determine whether a court has jurisdiction over the subject
matter of a case, it is important to determine the nature of the cause of
action and of the relief sought.[13]
Batas Pambansa Blg. (BP) 129 as amended by Republic Act No. (RA) 7691
pertinently provides for the jurisdiction of the RTC and the first level courts
as follows:
Sec. 19. Jurisdiction in civil cases. - Regional Trial Courts shall exercise
exclusive original jurisdiction:

1. In all civil actions in which the subject of the litigation is incapable of


pecuniary estimation;

2. In all civil actions which involve the title to, or possession of, real
property, or any interest therein, where the assessed value of the property
involved exceeds Twenty thousand pesos (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, original jurisdiction over which is conferred upon the Metropolitan
Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts.
and
Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and
Municipal Circuit Trial Courts in civil cases. - Metropolitan Trial Courts,
Municipal Trial Courts, and Municipal Circuit Trial Courts shall exercise:
x x x x

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 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: Provided, That in cases of land not declared for taxation purposes, the
value of such property shall be determined by the assessed value of the
adjacent lots.
From the foregoing, the RTC exercises exclusive original jurisdiction in civil
actions where the subject of the litigation is incapable of pecuniary
estimation. It also has jurisdiction in civil cases involving title to, or
possession of, real property or any interest in it where the assessed value of
the property involved exceeds P20,000.00, and if it is below P20,000.00, it is
the first level court which has jurisdiction. An action "involving title to real
property" means that the plaintiffs cause of action is based on a claim that
he owns such property or that he has the legal right to have exclusive
control, possession, enjoyment, or disposition of the same. [14]

The allegations and reliefs sought in petitioner's action for foreclosure of


mortgage showed that the loan obtained by respondents spouses Barrios
from petitioner fell due and they failed to pay such loan which was secured
by a mortgage on the property of the respondents spouses; and prayed that
in case of default of payment of such mortgage indebtedness to the court,
the property be ordered sold to answer for the obligation under the mortgage
contract and the accumulated interest. It is worthy to mention that the
essence of a contract of mortgage indebtedness is that a property has been
identified or set apart from the mass of the property of the debtor-mortgagor
as security for the payment of money or the fulfillment of an obligation to
answer the amount of indebtedness, in case of default in payment. [15]
Foreclosure is but a necessary consequence of non-payment of the mortgage
indebtedness.[16] In a real estate mortgage when the principal obligation is
not paid when due, the mortgagee has the right to foreclose the mortgage
and to have the property seized and sold with the view of applying the
proceeds to the payment of the obligation. [17] Therefore, the foreclosure suit
is a real action so far as it is against property, and seeks the judicial
recognition of a property debt, and an order for the sale of the res. [18]

As foreclosure of mortgage is a real action, it is the assessed value of the


property which determines the court's jurisdiction. Considering that the
assessed value of the mortgaged property is only P13,380.00, the RTC
correctly found that the action falls within the jurisdiction of the first level
court. er Section 33(3) of BP 129 as amended.

Petitioner cites Russell v. Vestil[19] to show that action for foreclosure of


mortgage is an action incapable of pecuniary estimation and, therefore,
within the jurisdiction of the RTC. We are not persuaded. In the Russell case,
we held:
In Singsong vs. Isabela Sawmill, 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, the claim is considered capable
of pecuniary estimation, and whether jurisdiction is in the municipal courts or
in the courts of first instance would depend on the amount of the claim.
However, where 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 considered such
actions as cases 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 Courts).

Examples of actions incapable of pecuniary estimation are those for specific


performance, support, or foreclosure of mortgage or annulment of judgment;
also actions questioning the validity of a mortgage, annulling a deed of sale
or conveyance and to recover the price paid and for rescission, which is a
counterpart of specific performance.

While actions under Sec. 33(3) of B.P. 129 are also incapable of pecuniary
estimation, the law 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 Regional Trial Courts which have jurisdiction under Sec. 19(2).
However, the subject matter of the complaint in this case is annulment of a
document denominated as "DECLARATION OF HEIRS AND DEED OF
CONFIRMATION OF PREVIOUS ORAL PARTITION."[20]
Clearly, the last paragraph clarified that while civil actions which involve title
to, or possession of, real property, or any interest therein, are also incapable
of pecuniary estimation as it is not for recovery of money, the court's
jurisdiction will be determined by the assessed value of the property
involved.

WHEREFORE, the petition for certiorari is DISMISSED as we find no grave


abuse of discretion committed by the Regional Trial Court, Branch 6, Kalibo,
Aklan in dismissing the complaint for lack of jurisdiction.

SO ORDERED.

6. Rudy L.Racpan vs. Sharon Barroga-Haigh, G.R. No. 234499 June 6, 2018

Nature of the Case

This treats of the Petition for Review on Certiorari under Rule 45 of the Rules
of Court, assailing the February 13, 2017 Decision[1] and August 17, 2017
Resolution[2] of the Court of Appeals (CA) in CA G.R. CV No. 04034-MIN. Said
rulings affirmed the dismissal of the petitioner's complaint for improper
venue and failure to comply with a condition precedent to its filing.

Factual Antecedents

Petitioner Rudy Racpan filed a Complaint "For Declaration For Nullity of Deed
of Sale with Right to Repurchase & Attorney's Fees"[3] before the Regional
Trial Court of Davao City, Branch 11 (RTC-Davao). In his Complaint, which
was docketed as Civil Case No. 34, 742-2012, petitioner alleged that after his
wife's death on November 12, 2011, he instructed their daughter to arrange
his wife's important documents. In so doing, their daughter discovered a
Deed of Sale with Right to Purchase dated March 29, 2011. The Deed of Sale
was purportedly signed by him and his late wife and appeared to convey to
respondent Sharon Barroga-Haigh a real property registered in his name
under TCT No. T-142-2011009374 and located in Bo. Tuganay, Municipality
of Carmen, Province of Davao del Norte.[4] Petitioner maintained that the
Deed of Sale was falsified and fictitious as he never signed any contract, not
even any special power of attorney, for the sale or conveyance of the
property which is still in his possession. Thus, he prayed for the declaration
of the Deed of Sale's nullity.

In her Answer with Compulsory Counterclaim,[5] respondent contended, by


way of affirmative defense, that the venue of the Complaint was improperly
laid and that the filing of the case lacks the mandatory requirement of
Barangay Clearance. Subsequently, respondent filed a motion for preliminary
hearing on her affirmative defenses.

Acting on the motion, the RTC-Davao set the case for preliminary hearing
and thereafter issued an Order dated September 18, 2013 [6] dismissing the
petitioner's Complaint as follows:
WHEREFORE, in view of the foregoing, the present case is hereby ORDERED
DISMISSED for being improperly filed before the Regional Trial Court of
Davao City and for failure to comply with a condition precedent prior to its
filing.

SO ORDERED.[7]
Petitioner moved for the RTC-Davao to reconsider[8] its Order dismissing the
complaint but the trial court remained steadfast and denied his motion in its
June 19, 2004 Order.[9] Hence, the petitioner came to the CA on appeal.[10]

Ruling of the Court of Appeals

As stated at the outset hereof, the appellate court affirmed the dismissal of
the petitioner's Complaint as follows:
WHEREFORE, the order dated September 18, 2013 of the Regional Trial
Court, Branch 11, Davao City in Civil Case No. 34,742-12 is AFFIRMED.

SO ORDERED.[11]
The CA explained that petitioner's Complaint is a real action as it wants the
court to abrogate and nullify. whatever right or claim the respondent might
have on the property subject of the Deed of Sale. Hence, for the appellate
court, Section 1, Rule 4 of the Rules of Court is applicable. Under this Rule,
real actions shall be commenced and tried in the proper court which has
jurisdiction over the area wherein the real property involved is situated. As
the property involved is located in Bo. Tuganay, Municipality of Cannen,
Province of Davao del Norte, the appellate court held that the Complaint
should have been lodged with the RTC of Davao del Norte and not the RTC-
Davao.

Further, the CA found that the petitioner's prayer for the issuance of a writ of
preliminary injunction is a mere ploy to avoid the requirement of a barangay
conciliation, as a mere annotation of a notice of lis pendens would achieve
the same effect without having to undergo trial or post a bond.

In a Resolution dated August 17, 2017[12] the CA stood its ground by denying
the petitioner's Motion for Reconsideration.[13]

Hence, the petitioner's present recourse, it being his contention that the
Complaint he interposed with the RTC-Davao is a personal action. He
maintains that his Complaint is not concerned with title to or possession of
real property, as in fact, no transfer of possession or title of the real property
to the respondent has occurred.[14] For the petitioner, the Complaint's venue
was properly laid in Davao City where both he and the respondent reside.

Petitioner likewise reiterated that, as his Complaint was coupled with a


prayer for the issuance of a writ of preliminary injunction, it is exempt from
barangay conciliation proceedings.

Issue

The main and decisive issue for resolution is whether the CA erred in
affirming the dismissal of the petitioner's Complaint.
Our Ruling

The petition is impressed with merit.

The venue was properly laid as the complaint was a personal action.

By weight of jurisprudence, the nature of an action is determined by the


allegations in the complaint. In turn, the nature of the action determines its
proper venue. Rule 4 of the Rules of Court provides the rules on the situs for
bringing real and personal actions, viz:
Rule 4

VENUE OF ACTIONS

Section 1. Venue of real actions. - Actions affecting title to or possession of


real property, or interest therein, shall be commenced and tried in the proper
court which has jurisdiction over the area wherein the real property involved,
or a portion thereof, is situated.

Forcible entry and detainer actions shall be commenced and tried in the
municipal trial court of the municipality or city wherein the real property
involved, or a portion thereof, is situated.

Section 2. Venue of personal actions. - All other actions may be commenced


and tried where the plaintiff or any of the principal plaintiffs resides, or where
the defendant or any of the principal defendants resides, or in the case of a
non-resident defendant where he may be found, at the election of the
plaintiff.
Expounding on the foregoing provisions, the Court delineated the basic
distinction between a real and a personal action and their respective venues
in Bank of the Philippine Islands v. Hontanosas, Jr.,[15] stating that:
The determinants of whether an action is of a real or a personal nature have
been fixed by the Rules of Court and relevant jurisprudence. According to
Section 1, Rule 4 of the Rules of Court, a real action is one that affects title
to or possession of real property, or an interest therein. Such action is to be
commenced and tried in the proper court having jurisdiction over the area
wherein the real property involved, or a portion thereof, is situated, which
explains why the action is also referred to as a local action. In contrast, the
Rules of Court declares all other actions as personal actions. Such actions
may include those brought for the recovery of personal property, or for the
enforcement of some contract or recovery of damages for its breach, or for
the recovery of damages for the commission of an injury to the person or
property. The venue of a personal action is the place where the plaintiff or
any of the principal plaintiffs resides, or where the defendant or any of the
principal defendants resides, or in the case of a non-resident defendant
where he may be found, at the election of the plaintiff, for which reason the
action is considered a transitory one.
Otherwise stated, what determines the venue of a case is the primary
objective for the filing of the case.[16] On one hand, if the plaintiff seeks the
recovery of personal property, the enforcement of a contract or the recovery
of damages, his complaint is a personal action that may be filed in the place
of residence of either party. On the other hand, if the plaintiff seeks the
recovery of real property, or if the action affects title to real property or for
the recovery of possession, or for partition or condemnation of, or foreclosure
of mortgage on, real property, then the complaint is a real action that must
be brought before the court where the real property is located. Thus, in Chua
v. Total Office Products and Services, Inc.,[17] this Court ruled that where the
action is not intended for the recovery of real property but solely for the
annulment of a contract, it is a personal action that may be filed in the court
where the plaintiff or the respondent resides. It held:
Well-settled is the rule that an action to annul a contract of loan and its
accessory real estate mortgage is a personal action. In a personal action, the
plaintiff seeks the recovery of personal property, the enforcement of a
contract or the recovery of damages. In contrast, in a real action, the plaintiff
seeks the recovery of real property, or, as indicated in Section 2 (a), Rule 4
of the then Rules of Court, a real action is an action affecting title to real
property or for the recovery of possession, or for partition, or condemnation
of, or foreclosure of mortgage on, real property.

In the Pascual case, relied upon by petitioner, the contract of sale of the
fishpond was assailed as fictitious for lack of consideration. We held that
there being no contract to begin with, there is nothing to annul. Hence, we
deemed the action for annulment of the said fictitious contract therein as one
constituting a real action for the recovery of the fishpond subject thereof

We cannot, however, apply the foregoing doctrine to the instant case. Note
that in Pascual, title to and possession of the subject fishpond had already
passed to the vendee. There was, therefore, a need to recover the said
fishpond. But in the instant case, ownership of the parcels of land
subject of the questioned real estate mortgage was never transferred
to petitioner, but remained with TOPROS. Thus, no real action for the
recovery of real property is involved. This being the case, TOPROS'
action for annulment of the contracts of loan and real estate
mortgage remains a personal action. (emphasis supplied)
In the Complaint filed with the court a quo, petitioner sought the nullification
of the Deed of Sale with Right to Repurchase on the strength of this claim:
he did not sign the same nor did he execute any special power of attorney in
favor of his late wife to do so in his behalf.[18] But, as there was no
allegation that the possession and title to the property have been
transferred to respondent, nowhere in the Complaint did petitioner
allege or pray for the recovery or reconveyance of the real property.
Pertinent parts of the Complaint read thus:
4. Plaintiff was married to Ma. Lucila B. Racpan on 20 December 1978. The
latter died on 13 November 2011 at Oroville, California...

5. Plaintiff Racpan purchased a property from his brother Lorezo L. Racpan


formerly covered by Transfer Certificate of Title No. T-189893 and located at
Carmen, Davao del Norte and the said property is now covered by
Transfer Certificate of Title No. T-142-2011009374. Hereto attached
and marked as Annex "B" is a copy of the Transfer Certificate of Title No.
T-142-2011009374 registered under the name of plaintiff Rudy L.
Racpan. Also attached and marked as Annex "C'" is the tax declaration of
the subject property to prove that plaintiff is the owner of the same.

6. Plaintiff's wife died at Oroville, California on 12 November 2011. However,


her remains were returned to Davao City, Philippines. Nonetheless, it was the
daughter of the plaintiff in the person of Lani Racpan who arrived first in
Davao City.

xxxx

8. On 12 December 2011, plaintiff's daughter showed to him the subject


deed of sale with right to repurchase dated 29 March 2011. Plaintiff was
surprised because he did not know or has NO knowledge of the said deed of
sale with right to repurchase. When plaintiff navigated the Deed of Sale,
he was surprised because his signature appearing on the same is
COMPLETELY FALSIFIED....

8.a Moreover, plaintiff did not also execute any special power of
attorney in favour of his deceased wife authoring the latter to [sell]
the subject property to the defendant.

8.b On the other hand, the subject property is registered under the
name of plaintiff Rudy Racpan and NOT TO SPOUSES Racpan. The
words "married to Ma. Lucila B. Racpan" only signified the civil status of
plaintiff to the latter.

xxxx

9.d Evidently, from the foregoing the (alleged) subject deed of sale with
right to repurchase is NULL AND VOID as the same contains the
falsified signature of the herein plaintiff.

xxxx

11. Plaintiff before and during the time of the execution of the subject Deed
of Sale with Right to Repurchase dated 29 March 2011 NEVER MET defendant
Saigh. It was only sometime in December 7 or 8, 2011 that he met
defendant Saigh during the wake of his wife wherein he was introduced to
the former by Orly Gabriel.

12. To date, plaintiff is in possession of the subject property. However,


his daughter has been receiving text message from defendant requiring him
to settle the said alleged obligation of his deceased wife to her. [19]
Evidently, as the Complaint was not concerned with the title to or recovery of
the real property, it was a personal action. Thus, Davao City, where both
the petitioner and the respondent reside is the proper venue for the
complaint. The appellate court therefore committed a reversible error in
affirming the trial court's dismissal of the case for improper venue.

The Complaint was exempted from Barangay Conciliation


Proceedings
As for petitioner's failure to resort to barangay conciliation, Section 412 of
the Local Government Code (LGC) provides that parties may go directly to
court where the action is coupled with provisional remedies:
SEC. 412. Conciliation. - (a) Pre-condition to filing of complaint in court. -
No complaint, petition, action, or proceeding involving any matter within the
authority of the lupon shall be filed or instituted directly in court or any other
government office for adjudication, unless there has been a confrontation
between the parties before the lupon chairman or the pangkat, and that no
conciliation or settlement has been reached as certified by the lupon
secretary or pangkat secretary as attested to by the lupon chairman or
pangkat chairman or unless the settlement has been repudiated by the
parties thereto.

(b) Where parties may go directly to court. - The parties may go directly to
court in the following instances:

(1) Where the accused is under detention;

(2) Where a person has otherwise been deprived of personal liberty calling
for habeas corpus proceedings;

(3) Where actions are coupled with provisional remedies such as


preliminary injunction, attachment, delivery of personal property, and
support pendente lite; and

(4) Where the action may otherwise be barred by the statute of limitations.

(c) Conciliation among members of indigenous cultural communities. - The


customs and traditions of indigenous cultural communities shall be applied in
settling disputes between members of the cultural communities.

While there is no dispute herein that the present case was never referred to
the Barangay Lupon for conciliation before petitioner instituted Civil Case No.
34, 742-2012, there is likewise no quibbling that his Complaint was coupled
with a prayer for the issuance of a preliminary injunction. [20] Hence, it falls
among the exceptions to the rule requiring the referral to baranggay
conciliation.

As good faith is always presumed,[21] in the absence of proof of improper


motive on the part of the petitioner, the Court cannot countenance the
appellate court's assumption that petitioner was solely intent on evading the
requirements of the LGC in applying for a preliminary injunction. This Court
cannot sustain a dismissal of an action on account of an unproven assertion
of bad faith.

WHEREFORE, the petition is GRANTED. The February 13, 2017 Decision


and August 17, 2017 Resolution of the Court of Appeals in CA-G.R. CV No.
04034-MIN, as well as the Orders dated September 18, 2013 and June 19,
2004 of the Regional Trial Court of Davao City, Branch 11, in Civil Case No.
34, 742-2012 are REVERSED and SET ASIDE. Civil Case No. 34, 742-2012
is hereby ordered REINSTATED. The RTC is ordered to proceed with
dispatch in the disposition of the mentioned case.

SO ORDERED.
7. Antonio T. Chua vs. Total Office Products and Services G.R. No.
152808, Sept. 30, 2005

For review on certiorari is the decision[1] dated November 28, 2001 of the
Court of Appeals and its resolution[2] of April 1, 2002 in CA-G.R. SP No.
62592.  The assailed decision and resolution dismissed the special civil action
for certiorari against the orders of August 9, 2000 [3] and October 6, 2000[4]
issued by Judge Lorifel Lacap Pahimna in Civil Case No. 67736.

The pertinent facts, based on the records, are as follows:

On December 28, 1999, respondent Total Office Products and Services, Inc.,
(TOPROS) lodged a complaint for annulment of contracts of loan and real
estate mortgage against herein petitioner Antonio T. Chua before the
Regional Trial Court of Pasig City.  The case was docketed as Civil Case No.
67736 and was raffled to the sala of Judge Lorifel Lacap Pahimna.

The said suit sought to annul a loan contract allegedly extended by


petitioner to respondent TOPROS in the amount of ten million four hundred
thousand pesos (P10,400,000) and the accessory real estate mortgage
contract covering two parcels of land situated in Quezon City as collateral.

It appeared on the face of the subject contracts that TOPROS was


represented by its president John Charles Chang, Jr.  However, TOPROS
alleged that the purported loan and real estate mortgage contracts were
fictitious, since it never authorized anybody, not even its president, to enter
into said transaction.

On February 28, 2000, petitioner filed a motion to dismiss on the ground of


improper venue.  He contended that the action filed by TOPROS affects title
to or possession of the parcels of land subject of the real estate mortgage. 
He argued that it should thus have been filed in the Regional Trial Court of
Quezon City where the encumbered real properties are located, instead of
Pasig City where the parties reside.

On August 9, 2000, Judge Pahimna issued an order denying the motion to


dismiss.  She reasoned that the action to annul the loan and mortgage
contracts is a personal action and thus, the venue was properly laid in the
RTC of Pasig City where the parties reside.

Petitioner moved for a reconsideration of the said order, which Judge


Pahimna denied in its order of October 6, 2000.  Hence, petitioner filed with
the Court of Appeals a special civil action for certiorari alleging:
THE RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF DISCRETION IN
DISREGARDING THE RULING OF THE SUPREME COURT IN PASCUAL VS.
PASCUAL REGARDING THE RULE ON PROPER VENUE, AND CONSEQUENTLY
ADJUDGING TO BE A PERSONAL ACTION A CIVIL COMPLAINT FOR THE
ANNULMENT OF AN ALLEGEDLY FICTITIOUS CONTRACT.[5]
The Court of Appeals dismissed said petition in its decision dated November
28, 2001. It held that the authorities relied upon by petitioner, namely
Pascual v. Pascual[6] and Banco Español-Filipino v. Palanca,[7] are inapplicable
in the instant case.  The appellate court instead applied Hernandez v. Rural
Bank of Lucena, Inc.[8] wherein we ruled that an action for the cancellation of
a real estate mortgage is a personal action if the mortgagee has not
foreclosed the mortgage and the mortgagor is in possession of the premises,
as neither the mortgagor's title to nor possession of the property is disputed.

Dissatisfied, petitioner filed a motion for reconsideration, which the Court of


Appeals denied for lack of merit in its resolution of April 1, 2002.

Undeterred, petitioner now comes to us on a petition for review raising the


following issues:
WHETHER AN ACTION TO ANNUL A LOAN AND MORTGAGE CONTRACT DULY
ALLEGED AS 'FICTITIOUS' FOR BEING WITH ABSOLUTELY NO
CONSIDERATION IS A PERSONAL ACTION OR REAL ACTION?

WHETHER IN AN ACTION TO ANNUL A LOAN AND MORTGAGE CONTRACT


DULY ALLEGED AS 'FICTITIOUS' FOR BEING WITH ABSOLUTELY NO
CONSIDERATION, THE PERSON ALLEGED TO HAVE '[LACKED] AUTHORITY'
TO ENTER INTO SAID CONTRACTS IS AN INDISPENSABLE PARTY?
Petitioner contends that Hernandez should not be applied here because in the
said case:  (1) venue was improperly laid at the outset; (2) the complaint
recognized the validity of the principal contract involved; and (3) the plaintiff
sought to compel acceptance by the defendant of plaintiff's payment of the
latter's mortgage debt.  He insists that the Pascual case should be applied
instead.  He invokes our pronouncement in Pascual, to wit:
... It appearing, however, that the sale is alleged to be fictitious, with
absolutely no consideration, it should be regarded as a non-existent, not
merely null, contract.... And there being no contract between the deceased
and the defendants, there is in truth nothing to annul by action.  The action
brought cannot thus be for annulment of contract, but is one for recovery of
a fishpond, a real action that should be, as it has been, brought in
Pampanga, where the property is located....[10]
Petitioner likewise cites the Banco Español-Filipino case, thus:
Where the defendant in a mortgage foreclosure lives out of the Islands and
refuses to appear or otherwise submit himself to the authority of the court,
the jurisdiction of the latter is limited to the mortgaged property, with
respect to which the jurisdiction of the court is based upon the fact that the
property is located within the district and that the court, under the provisions
of law applicable in such cases, is vested with the power to subject the
property to the obligation created by the mortgage. In such case personal
jurisdiction over the nonresident defendant is nonessential and in fact cannot
be acquired.[11]
Petitioner also alleges that John Charles Chang, Jr., the president of TOPROS,
who allegedly entered into the questioned loan and real estate mortgage
contracts, is an indispensable party who has not been properly impleaded.

TOPROS, however, maintains that the appellate court correctly sustained the
lower court's finding that the instant complaint for annulment of loan and
real estate mortgage contracts is a personal action.  TOPROS points out that
a complaint for the declaration of nullity of a loan contract for lack of consent
and consideration remains a personal action even if the said action will
necessarily affect the accessory real estate mortgage.
TOPROS argues that Pascual is inapplicable because the subject contract
therein was a contract of sale of a parcel of land where title and possession
were already transferred to the defendant.  TOPROS further contends that
Banco Español-Filipino is also inapplicable since the personal action filed
therein was one which affected the personal status of a nonresident
defendant.

Considering the facts and the submission of the parties, we find the petition
bereft of merit.

Well-settled is the rule that an action to annul a contract of loan and its
accessory real estate mortgage is a personal action.  In a personal action,
the plaintiff seeks the recovery of personal property, the enforcement of a
contract or the recovery of damages. [12]  In contrast, in a real action, the
plaintiff seeks the recovery of real property, or, as indicated in Section 2 (a),
Rule 4 of the then Rules of Court, a real action is an action affecting title to
real property or for the recovery of possession, or for partition or
condemnation of, or foreclosure of mortgage on, real property. [13]

In the Pascual case, relied upon by petitioner, the contract of sale of the
fishpond was assailed as fictitious for lack of consideration.  We held that
there being no contract to begin with, there is nothing to annul.  Hence, we
deemed the action for annulment of the said fictitious contract therein as one
constituting a real action for the recovery of the fishpond subject thereof.

We cannot, however, apply the foregoing doctrine to the instant case.  Note
that in Pascual, title to and possession of the subject fishpond had already
passed to the vendee.  There was, therefore, a need to recover the said
fishpond.  But in the instant case, ownership of the parcels of land subject of
the questioned real estate mortgage was never transferred to petitioner, but
remained with TOPROS.  Thus, no real action for the recovery of real
property is involved.  This being the case, TOPROS' action for annulment of
the contracts of loan and real estate mortgage remains a personal action.

Petitioner's reliance on the Banco Español-Filipino case is likewise misplaced. 


That case involved a foreclosure of real estate mortgage against a
nonresident.  We held therein that jurisdiction is determined by the place
where the real property is located and that personal jurisdiction over the
nonresident defendant is nonessential and, in fact, cannot be acquired.

Needless to stress, the instant case bears no resemblance to the Banco


Español-Filipino case.  In the first place, this is not an action involving
foreclosure of real estate mortgage.  In the second place, none of the parties
here is a nonresident.  We find no reason to apply here our ruling in Banco
Español-Filipino.

The Court of Appeals finds that Hernandez v. Rural Bank of Lucena, Inc.
provides the proper precedent in this case.  In Hernandez, appellants
contended that the action of the Hernandez spouses for the cancellation of
the mortgage on their lots was a real action affecting title to real property,
which should have been filed in the place where the mortgaged lots were
situated.  Rule 4, Section 2 (a), of the then Rules of Court, was applied, to
wit:
SEC. 2. Venue in Courts of First Instance. – (a) Real actions. – Actions
affecting title to, or for recovery of possession, or for partition or
condemnation of, or foreclosure of mortgage on, real property, shall be
commenced and tried in the province where the property or any part thereof
lies.
The Court pointed out in the Hernandez case that with respect to mortgage,
the rule on real actions only mentions an action for foreclosure of a real
estate mortgage.  It does not include an action for the cancellation of a real
estate mortgage.  Exclusio unios est inclusio alterius. The latter thus falls
under the catch-all provision on personal actions under paragraph (b) of the
above-cited section, to wit:
SEC. 2 (b) Personal actions. – All other actions may be commenced and tried
where the defendant or any of the defendants resides or may be found, or
where the plaintiff or any of the plaintiffs resides, at the election of the
plaintiff.
In the same vein, the action for annulment of a real estate mortgage in the
present case must fall under Section 2 of Rule 4, to wit:
SEC. 2.  Venue of personal actions. – All other actions may be commenced
and tried where the plaintiff or any of the principal plaintiffs resides, or where
the defendant or any of the principal defendants resides, or in the case of a
non-resident defendant where he may be found, at the election of the
plaintiff.[14]
Thus, Pasig City, where the parties reside, is the proper venue of the action
to nullify the subject loan and real estate mortgage contracts. The Court of
Appeals committed no reversible error in upholding the orders of the
Regional Trial Court denying petitioner's motion to dismiss the case on the
ground of improper venue.

Anent the second issue, Section 7, Rule 3 of the Revised Rules of Court
provides:

SEC. 7. Compulsory joinder of indispensable parties. – Parties in interest


without whom no final determination can be had of an action shall be joined
either as plaintiffs or defendants. (Emphasis ours)
The presence of indispensable parties is necessary to vest the court with
jurisdiction.  The absence of an indispensable party renders all subsequent
actuations of the court null and void, because of that court's want of
authority to act, not only as to the absent parties but even as to those
present.[15]  Thus, whenever it appears to the court in the course of a
proceeding that an indispensable party has not been joined, it is the duty of
the court to stop the trial and order the inclusion of such party. [16]

A person is not an indispensable party, however, if his interest in the


controversy or subject matter is separable from the interest of the other
parties, so that it will not necessarily be directly or injuriously affected by a
decree which does complete justice between them.[17]
Is John Charles Chang, Jr., the president of TOPROS who allegedly entered
into the disputed contracts of loan and real estate mortgage, an
indispensable party in this case?

We note that although it is Chang's signature that appears on the assailed


real estate mortgage contract, his participation is limited to being a
representative of TOPROS, allegedly without authority.  The document[18]
which constitutes as the contract of real estate mortgage clearly points to
petitioner and TOPROS as the sole parties-in-interest to the agreement as
mortgagee and mortgagor therein, respectively.  Any rights or liabilities
arising from the said contract would therefore bind only the petitioner and
TOPROS as principal parties.  Chang, acting as mere representative of
TOPROS, acquires no rights whatsoever, nor does he incur any liabilities,
arising from the said contract between petitioner and TOPROS.  Certainly, in
our view, the only indispensable parties to the mortgage contract are
petitioner and TOPROS alone.

We thus hold that John Charles Chang, Jr., is not an indispensable party in
Civil Case No. 67736.  This is without prejudice to any separate action
TOPROS may institute against Chang, Jr., in a proper proceeding.

WHEREFORE, the petition is DENIED.  The assailed decision dated


November 28, 2001 and resolution dated April 1, 2002 of the Court of
Appeals upholding the Orders of Judge Lorifel Lacap Pahimna are
AFFIRMED.

No pronouncement as to costs.

SO ORDERED.

-------------------------------------------

NOTE: From this day until May 10, 2020, consider this your pointers for review.
Comes May 11, 2020, this will be your examination. You may start answering
now, or wait for May 11, 2020 .. TO BE EMAILED TO ME ON (OR BETTER,
BEFORE) THE DAY STATED IN THE ADVISORY FROM THE DEAN’S OFFICE.
(still compliant naman di ba? )

There is still a discussion as to how your answers should be submitted. Type-


written daw ba or handwritten (then picture, then send). I will not wait anymore
for the final decision. Pakitype na lang po and email. Anyway, I have your
handwritten record books which is the other part of your exams; BUT if there are
some of you who are uncomfortable with this instruction, then I suggest that you
wait for the final announcement then comply accordingly. Works both ways.

p.s. IT HAS BEEN A PLEASURE BEING WITH YOU. THANK YOU FOR
BEARING WITH MY WAY OF “TEACHING”. I WOULD HAVE WANTED TO
COMPLETE THE COURSE WITH YOU BUT I GUESS THIS IS HOW IT IS
MEANT TO BE . I AM SORRY THAT I DID NOT STIR ENOUGH CONFUSION
TO INSPIRE YOU TO READ .... STAY SAFE.

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