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8/10/2019 Civpro(Full Wo Digest)
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Republic of the Philippines
SUPREME COURTManila
EN BANC
G.R. No. 153690 February 15, 2011DAVID LU,Petitioner,
vs.
PATERNO LU YM, SR., PATERNO LU YM, JR., VICTOR LU YM, JOHN LU YM, KELLY
LU YM, and LUDO & LUYM DEVELOPMENT CORPORATION,Respondents.x - - - - - - - - - - - - - - - - - - - - - - -x
G.R. No. 157381PATERNO LU YM, SR., PATERNO LU YM, JR., VICTOR LU YM, JOHN LU YM, KELLY
LU YM, and LUDO & LUYM DEVELOPMENT CORPORATION,Petitioners,vs.
DAVID LU,Respondent.x - - - - - - - - - - - - - - - - - - - - - - -x
G.R. No. 170889JOHN LU YM and LUDO & LUYM DEVELOPMENT CORPORATION,Petitioners,
vs.
THE HONORABLE COURT OF APPEALS OF CEBU CITY (FORMER TWENTIETHDIVISION), DAVID LU, ROSA GO, SILVANO LUDO & CLCORPORATION,Respondents.
R E S O L U T I O N
CARPIO MORALES,J.:By Decision of August 26, 2008, the Court
1unanimously disposed of the three
present petitions as follows:
WHEREFORE, premises considered, the petitions in G.R. Nos. 153690 and 157381
are DENIED for being moot and academic; while the petition in G.R. No. 170889 is
DISMISSED for lack of merit. Consequently, the Status QuoOrder dated January 23,
2006 is hereby LIFTED.
The Court of Appeals is DIRECTED to proceed with CA-G.R. CV No. 81163 and to
resolve the same with dispatch.
SO ORDERED[,]2
which Decision was, on motion for reconsideration, the Court voting 4-1,3reversed
by Resolution of August 4, 2009, the dispositive portion of which reads:
WHEREFORE, in view of the foregoing, the Motion for Reconsideration filed by
John Lu Ym and Ludo & LuYm Development Corporation is GRANTED. The Decision
of this Court dated August 26, 2008 is RECONSIDERED and SET ASIDE. The
Complaint in SRC Case No. 021-CEB, now on appeal with the Court of Appeals in
CA-G.R. CV No. 81163, is DISMISSED.
All interlocutory matters challenged in these consolidated petitions are DENIED for
being moot and academic.
SO ORDERED.4
David Lus Motion for Reconsideration and Motion to Refer Resolution to the
Court En Bancwas denied by minute Resolution of September 23, 2009.
Following his receipt on October 19, 2009 of the minute Resolution, David Lu
personally filed on October 30, 2009 a Second Motion for Reconsideration and
Motion to Refer Resolution to the Court En Banc. On even date, he filed through
registered mail an "Amended Second Motion for Reconsideration and Motion to
Refer Resolution to the Court En Banc." And on November 3, 2009, he filed a
"Motion for Leave to File [a] Motion for Clarification[, and the] Second Motion for
Reconsideration and Motion to Refer Resolution to the Court En Banc." He lateralso filed a "Supplement to Second Motion for Reconsideration with Motion to
Dismiss" dated January 6, 2010.
John Lu Ym and Ludo & Luym Development Corporation (LLDC), meanwhile, filed
with leave a Motion5for the Issuance of an Entry of Judgment of February 2, 2010,
which merited an Opposition from David Lu.
In compliance with the Courts Resolution of January 11, 2010, Kelly Lu Ym, Victor
Lu Ym and Paterno Lu Ym, Jr. filed a Comment/Opposition of March 20, 2010,
while John Lu Ym and LLDC filed a Consolidated Comment of March 25, 2010, a
Supplement thereto of April 20, 2010, and a Manifestation of May 24, 2010.
The present cases were later referred to the Court en banc by Resolution of
October 20, 2010.Brief Statement of the AntecedentsThe three consolidated cases stemmed from the complaint for "Declaration of
Nullity of Share Issue, Receivership and Dissolution" filed on August 14, 2000
before the Regional Trial Court (RTC) of Cebu City by David Lu, et al.against Paterno
Lu Ym, Sr. and sons (Lu Ym father and sons) and LLDC.
By Decision of March 1, 2004, Branch 12 of the RTC ruled in favor of David et al.by
annulling the issuance of the shares of stock subscribed and paid by Lu Ym father
and sons at less than par value, and ordering the dissolution and asset liquidation
of LLDC. The appeal of the trial courts Decision remains pending with the appellate
court inCA-G.R. CV No. 81163.
Several incidents arising from the complaint reached the Court through the
present three petitions.
In G.R. No. 153690wherein David, et al.assailed the appellate courts resolutionsdismissing their complaint for its incomplete signatory in the certificate of non-
forum shopping and consequently annulling the placing of the subject corporation
under receivershippendente lite, the Court, by Decision of August 26, 2008, found
the issue to have been mooted by the admission by the trial court of David et al.s
Amended Complaint, filed by them pursuant to the trial courts order to conform
to the requirements of the Interim Rules of Procedure Governing Intra-Corporate
Controversies.
Since an amended pleading supersedes the pleading that it amends, the original
complaint of David, et al. was deemed withdrawn from the records.
The Court noted in G.R. No. 153690 that both parties admitted the mootness ofthe issue and that the trial court had already rendered a decision on the merits of
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the case. It added that the Amended Complaint stands since Lu Ym father and sons
availed of an improper mode (via an Urgent Motion filed with this Court) to assail
the admission of the Amended Complaint.
In G.R. No. 157381wherein Lu Ym father and sons challenged the appellate courtsresolution restraining the trial court from proceeding with their motion to lift the
receivership order which was filed during the pendency of G.R. No. 153690, the
Court, by Decision of August 26, 2008 resolved that the issue was mooted by the
amendment of the complaint and by the trial courts decision on the merits. The
motion having been filed ancillary to the main action, which main action wasalready decided on the merits by the trial court, the Court held that there was
nothing more to enjoin.
G.R. No. 170889 involved the denial by the appellate court of Lu Ym father andsons application in CA-G.R. CV No. 81163 for a writ of preliminary injunction. By
August 26, 2008 Decision, the Court dismissed the petition after finding no merit
on their argument which they raised for the first time in their motion for
reconsideration before the appellate court of lack of jurisdiction for non-
payment of the correct RTC docket fees.
As reflected early on, the Court, in a turnaround, by Resolution of August 4, 2009,
reconsidered its position on the matter of docket fees. It ruled that the trial court
did not acquire jurisdiction over the case for David Lu, et al.s failure to pay thecorrect docket fees, hence, all interlocutory matters and incidents subject of the
present petitions must consequently be denied.
Taking Cognizance of the Present IncidentsThe Internal Rules of the Supreme Court (IRSC) states that the Court en bancshall
act on the following matters and cases:
(a) cases in which the constitutionality or validity of any treaty, international or
executive agreement, law, executive order, presidential decree, proclamation,
order, instruction, ordinance, or regulation is in question;
(b) criminal cases in which the appealed decision imposes the death penalty
or reclusion perpetua;
(c) cases raising novel questions of law;
(d) cases affecting ambassadors, other public ministers, and consuls;
(e) cases involving decisions, resolutions, and orders of the Civil Service
Commission, the Commission on Elections, and the Commission on Audit;
(f) cases where the penalty recommended or imposed is the dismissal of a judge,
the disbarment of a lawyer, the suspension of any of them for a period of more
than one year, or a fine exceeding forty thousand pesos;
(g) cases covered by the preceding paragraph and involving the reinstatement in
the judiciary of a dismissed judge, the reinstatement of a lawyer in the roll of
attorneys, or the lifting of a judges suspension or a lawyers suspension from the
practice of law;
(h) cases involving the discipline of a Member of the Court, or a Presiding Justice,
or any Associate Justice of the collegial appellate court;
(i) cases where a doctrine or principle laid down by the Court en banc or by a
Division my be modified or reversed;
(j) cases involving conflicting decisions of two or more divisions;
(k) cases where three votes in a Division cannot be obtained;
(l) Division cases where the subject matter has a huge financial impact on
businesses or affects the welfare of a community;
(m) Subject to Section 11 (b) of this rule, other division cases that, in the opinion of
at least three Members of the Division who are voting and present, are
appropriate for transfer to the Court en banc;(n) cases that the Court en bancdeems of sufficient importance to merit its
attention; and
(o) all matters involving policy decisions in the administrative supervision of all
courts and their personnel.6(underscoring supplied)
The enumeration is an amalgamation of SC Circular No. 2-89 (February 7, 1989), as
amended by En Banc Resolution of November 18, 1993, and the amplifications
introduced by Resolution of January 18, 2000 in A.M. No. 99-12-08-SC with respect
to administrative cases and matters.
The present cases fall under at least three types of cases for consideration by the
Court En Banc. At least three members of the Courts Second Division (to which the
present cases were transferred,
7
they being assigned to a Member thereof) found,by Resolution of October 20, 2010, that the cases were appropriate for referral-
transfer to the Court En Bancwhich subsequently accepted8the referral in view of
the sufficiently important reason to resolve all doubts on the validity of the
challenged resolutions as they appear to modify or reverse doctrines or principles
of law.
In Firestone Ceramics v. Court of Appeals,9the Court treated the consolidated
cases as En Banc cases and set the therein petitioners motion for oral argument,
after finding that the cases were of sufficient importance to merit the Court En
Bancs attention. It ruled that the Courts action is a legitimate and valid exercise of
its residual power.10
In Limketkai Sons Milling, Inc. v. Court of Appeals, the Court conceded that it is not
infallible. Should any error of judgment be perceived, it does not blindly adhere to
such error, and the parties adversely affected thereby are not precluded from
seeking relief therefrom, by way of a motion for reconsideration. In this
jurisdiction, rectification of an error, more than anything else, is of paramount
importance.
x x x x
It bears stressing that where, as in the present case, the Court En Banc entertains a
case for its resolution and disposition, it does so without implying that the Division
of origin is incapable of rendering objective and fair justice. The action of the Court
simply means that the nature of the cases calls for en banc attention and
consideration. Neither can it be concluded that the Court has taken undue
advantage of sheer voting strength. It was merely guided by the well-studiedfinding and sustainable opinion of the majority of its actual membership that,
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indeed, subject cases are of sufficient importance meriting the action and decision
of the whole Court. It is, of course, beyond cavil that all the members of this
highest Court of the land are always embued with the noblest of intentions in
interpreting and applying the germane provisions of law, jurisprudence, rules and
Resolutions of the Courtto the end that public interest be duly safeguarded and
rule of law be observed.11
It is argued that the assailed Resolutions in the present cases have already become
final,12
since a second motion for reconsideration is prohibited except for
extraordinarily persuasive reasons and only upon express leave firstobtained;
13and that once a judgment attains finality, it thereby becomes
immutable and unalterable, however unjust the result of error may appear.
The contention, however, misses an important point. The doctrine of immutability
of decisions applies only to final and executory decisions. Since the present cases
may involve a modification or reversal of a Court-ordained doctrine or principle,
the judgment rendered by the Special Third Division may be considered
unconstitutional, hence, it can never become final. It finds mooring in the
deliberations of the framers of the Constitution:
On proposed Section 3(4), Commissioner Natividad asked what the effect would be
of a decision that violates the proviso that "no doctrine or principle of law laid
down by the court in a decision rendered en bancor in division may be modified orreversed except by the court en banc." The answer given was that such a decisionwould be invalid. Following up, Father Bernas asked whether the decision, if notchallenged, could become final and binding at least on the parties. Romulo
answered that, since such a decision would be in excess of jurisdiction, thedecision on the case could be reopened anytime .
14(emphasis and underscoring
supplied)
A decision rendered by a Division of this Court in violation of this constitutional
provision would be in excess of jurisdiction and, therefore, invalid.15
Any entry of
judgment may thus be said to be "inefficacious"16
since the decision is void for
being unconstitutional.
While it is true that the Court en bancexercises no appellate jurisdiction over its
Divisions, Justice Minerva Gonzaga-Reyes opined in Firestoneand concededly
recognized that "[t]he only constraint is that any doctrine or principle of law laid
down by the Court, either rendered en bancor in division, may be overturned or
reversed only by the Court sitting en banc."17
That a judgment must become final at some definite point at the risk of occasional
error cannot be appreciated in a case that embroils not only a general allegation of
"occasional error" but also a serious accusation of a violation of the
Constitution, viz., that doctrines or principles of law were modified or reversed by
the Courts Special Third Division August 4, 2009 Resolution.
The law allows a determination at first impression that a doctrine or principle laid
down by the court en bancor in division may be modified or reversed in a case
which would warrant a referral to the Court En Banc. The use of the word "may"instead of "shall" connotes probability, not certainty, of modification or reversal of
a doctrine, as may be deemed by the Court. Ultimately, it is the entire Court which
shall decide on the acceptance of the referral and, if so, "to reconcile any
seeming conflict, to reverse or modify an earlier decision, and to declare the
Courts doctrine."18
The Court has the power and prerogative to suspend its own rules and to exempt a
case from their operation if and when justice requires it ,19
as in the present
circumstance where movant filed a motion for leave after the prompt submission
of a second motion for reconsideration but, nonetheless, still within 15 days from
receipt of the last assailed resolution.Well-entrenched doctrines or principles of law that went astray need to be steered
back to their proper course. Specifically, as David Lu correctly points out, it is
necessary to reconcile and declare the legal doctrines regarding actions that are
incapable of pecuniary estimation, application of estoppel by laches in raising an
objection of lack of jurisdiction, and whether bad faith can be deduced from the
erroneous annotation of lis pendens.
Upon a considered, thorough reexamination, the Court grants David Lus Motionfor Reconsideration. The assailed Resolutions of August 4, 2009 and September23, 2009, which turn turtle settled doctrines, must be overturned. The Courtthus reinstates the August 26, 2008 Decision wherein a three-tiered approach was
utilized to analyze the issue on docket fees:In the instant case, however, we cannot grant the dismissal prayed for because of
the following reasons: First, the case instituted before the RTC is one incapable of
pecuniary estimation. Hence, the correct docket fees were paid. Second, John andLLDC are estopped from questioning the jurisdiction of the trial court because oftheir active participation in the proceedings below, and because the issue of
payment of insufficient docket fees had been belatedly raised before the Court of
Appeals, i.e., only in their motion for reconsideration. Lastly, assuming that the
docket fees paid were truly inadequate, the mistake was committed by the Clerkof Court who assessed the same and not imputable to David ; and as to thedeficiency, if any, the same may instead be considered a lien on the
judgmentthat may thereafter be rendered.20
(italics in the original; emphasis and
underscoring supplied)
The Value of the Subject Matter Cannot be Estimated On the claim that the complaint had for its objective the nullification of the
issuance of 600,000 shares of stock of LLDC, the real value of which based on
underlying real estate values, as alleged in the complaint, stands atP1,087,055,105,
the Courts assailed August 4, 2009 Resolution found:
Upon deeper reflection, we find that the movants *Lu Ym father & sons+ claim has
merit. The 600,000 shares of stock were, indeed, properties in litigation. They were
the subject matter of the complaint, and the relief prayed for entailed the
nullification of the transfer thereof and their return to LLDC. David, et al., are
minority shareholders of the corporation who claim to have been prejudiced by
the sale of the shares of stock to the Lu Ym father and sons. Thus, to the extent ofthe damage or injury they allegedly have suffered from this sale of the shares of
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stock, the action they filed can be characterized as one capable of pecuniary
estimation. The shares of stock have a definite value, which was declared by
plaintiffs [David Lu, et al.] themselves in their complaint. Accordingly, the docket
fees should have been computed based on this amount. This is clear from the
following version of Rule 141, Section 7, which was in effect at the time the
complaint was filed[.]21
(emphasis and underscoring supplied)
Thesaid Resolution added that the value of the 600,000 shares of stock, which arethe properties in litigation, should be the basis for the computation of the filing
fees. It bears noting, however, that David, et al. are not claiming to own theseshares. They do not claim to be the owners thereof entitled to be the transferees
of the shares of stock. The mention of the real value of the shares of stock, overwhich David, et al.donot, it bears emphasis, interpose a claim of right torecovery, is merely narrative or descriptive in order to emphasize the inequitable
price at which the transfer was effected.
The assailed August 4, 2009 Resolution also stated that "to the extent of the
damage or injury [David, et al.] allegedly have suffered from this sale," the action
"can be characterized as one capable of pecuniary estimation." The Resolution
does not, however, explore the value of the extent of the damage or injury. Could
it be thepro ratadecrease (e.g., from 20% to 15%) of the percentage shareholding
of David, et al.vis--vis to the whole?Whatever property, real or personal, that would be distributed to the stockholders
would be a mere consequence of the main action. In the end, in the event LLDC is
dissolved, David, et al.would not be getting the value of the 600,000 shares, but
only the value of their minority number of shares, which are theirs to begin with.
The complaint filed by David, et al. is one for declaration of nullity of shareissuance. The main relief prayed for both in the original complaint and theamended complaint is the same, that is, to declare null and void the issuance of
600,000 unsubscribed and unissued shares to Lu Ym father and sons, et al.for a
price of 1/18 of their real value, for being inequitable, having been done in breach
of directors fiduciarys duty to stockholders, in violation of the minority
stockholders rights, and with unjust enrichment.
As judiciously discussed in the Courts August 26, 2008 Decision, t he test in
determining whether the subject matter of an action is incapable of pecuniary
estimation is by ascertaining the nature of the principal action or remedy sought. It
explained:
x x x To be sure, the annulment of the shares, the dissolution of the corporation
and the appointment of receivers/management committee are actions which donot consist in therecoveryof a sum of money. If, in the end, a sum of money orreal property would be recovered, it would simply be the consequence of such
principal action. Therefore, the case before the RTC was incapable of pecuniary
estimation.22
(italics in the original, emphasis and underscoring supplied)
Actions which the Court has recognized as being incapable of pecuniary estimation
include legality of conveyances. In a case involving annulment of contract, theCourt found it to be one which cannot be estimated:
Petitioners argue that an action for annulment or rescission of a contract of sale of
real property is a real action and, therefore, the amount of the docket fees to be
paid by private respondent should be based either on the assessed value of the
property, subject matter of the action, or its estimated value as alleged in the
complaint, pursuant to the last paragraph of 7(b) of Rule 141, as amended by the
Resolution of the Court dated September 12, 1990. Since private respondents
alleged that the land, in which they claimed an interest as heirs, had been sold for
P4,378,000.00 to petitioners, this amount should be considered the estimated
value of the land for the purpose of determining the docket fees.On the other hand, private respondents counter that an action for annulment or
rescission of a contract of sale of real property is incapable of pecuniary estimation
and, so, the docket fees should be the fixed amount of P400.00 in Rule 141,
7(b)(1). In support of their argument, they cite the cases of Lapitan v. Scandia,
Inc.and Bautista v. Lim. In Lapitanthis Court, in an opinion by Justice J.B.L. Reyes,
held:
A review of the jurisprudence of this Court indicates 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 inthe 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, or where the money claim is purely incidental to, or a
consequence of, the principal relief sought, like in suits to have the defendant
perform his part of the contract (specific performance) and in actions for support,
or for annulment of a judgment or to forec lose a mortgage, 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. The rationale of the rule is plainly that the second class cases, besidesthe determination of damages, demand an inquiry into other factors which thelaw has deemed to be more within the competence of courts of first instance ,
which were the lowest courts of record at the time that the first organic laws of
the Judiciary were enacted allocating jurisdiction (Act 136 of the Philippine
Commission of June 11, 1901).
Actions for specific performance of contracts have been expressly pronounced to
be exclusively cognizable by courts of first instance: De Jesus vs. Judge Garcia, L-
26816, February 28, 1967; Manufacturer's Distributors, Inc. vs. Yu Siu Liong, L-
21285, April 29, 1966. And no cogent reason appears, and none is here advancedby the parties, why an action for rescission (or resolution) should be differentlytreated, a "rescission" being a counterpart, so to speak, of "specificperformance". In both cases, the court would certainly have to undertake aninvestigation into facts that would justify one act or the other. No award for
damages may be had in an action for rescission without first conducting aninquiry into matters which would justify the setting aside of a contract , in the
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same manner that courts of first instance would have to make findings of fact and
law in actions not capable of pecuniary estimation expressly held to be so by this
Court, arising from issues like those raised in Arroz v. Alojado, et al., L-22153,
March 31, 1967 (the legality or illegality of the conveyance sought for and thedetermination of the validity of the money deposit made); De Ursua v. Pelayo, L-
13285, April 18, 1950 (validity of a judgment); Bunayog v. Tunas, L-12707,
December 23, 1959 (validity of a mortgage); Baito v. Sarmiento, L-13105, August
25, 1960 (the relations of the parties, the right to support created by the relation,
etc., in actions for support), De Rivera, et al. v. Halili, L-15159, September 30, 1963(the validity or nullity of documents upon which claims are predicated). Issues of
the same nature may be raised by a party against whom an action for rescission
has been brought, or by the plaintiff himself. It is, therefore, difficult to see why a
prayer for damages in an action for rescission should be taken as the basis for
concluding such action as one capable of pecuniary estimation a prayer which
must be included in the main action if plaintiff is to be compensated for what he
may have suffered as a result of the breach committed by defendant, and not later
on precluded from recovering damages by the rule against splitting a cause of
action and discouraging multiplicity of suits.23
(emphasis and underscoring
supplied)
IN FINE, the Court holds that David Lu, et al.s complaint is one incapable ofpecuniary estimation, hence, the correct docket fees were paid. The Court thus
proceeds to tackle the arguments on estoppel and lien, mindful that the
succeeding discussions rest merely on a contrary assumption, viz., that there was
deficient payment.
Estoppel Has Set InAssuming arguendo that the docket fees were insufficiently paid, the doctrine of
estoppel already applies.
The assailed August 4, 2009 Resolution cited Vargas v. Caminas24
on the non-
applicability of the Tijam doctrinewhere the issue of jurisdiction was, in fact, raised
before the trial court rendered its decision. Thus the Resolution explained:
Next, the Lu Ym father and sons filed a motion for the lifting of the receivership
order, which the trial court had issued in the interim. David, et al., brought the
matter up to the CA even before the trial court could resolve the motion.
Thereafter, David, at al., filed their Motion to Admit Complaint to Conform to the
Interim Rules Governing Intra-Corporate Controversies. It was at this point that the
Lu Ym father and sons raised the question of the amount of filing fees paid. They
also raised this point again in the CA when they appealed the trial courts decision
in the case below.
We find that, in the circumstances, the Lu Ym father and sons are not estopped
from challenging the jurisdiction of the trial court. They raised the insufficiency of
the docket fees before the trial court rendered judgment and continuously
maintained their position even on appeal to the CA. Although the manner of
challenge waserroneous they should have addressed this issue directly to thetrial court instead of the OCA they should not be deemed to have waived their
right to assail the jurisdiction of the trial court .25
(emphasis and underscoring
supplied)
Lu Ym father and sons did not raise the issue before the trial court. The narration
of facts in the Courts original decision shows that Lu Ym father and sons merely
inquired from the Clerk of Court on the amount of paid docket fees on January 23,
2004. They thereafter still "speculat[ed] on the fortune of litigation."26
Thirty-seven
days later or on March 1, 2004 the trial court rendered its decision adverse to
them.
Meanwhile, Lu Ym father and sons attempted to verify the matter of docket feesfrom the Office of the Court Administrator (OCA). In their Application for the
issuance a writ of preliminary injunction filed with the Court of Appeals, they still
failed to question the amount of docket fees paid by David Lu, et al. It was only in
their Motion for Reconsideration of the denial by the appellate court of their
application for injunctive writ that they raised such issue.
Lu Ym father and sons further inquiry from the OCA cannot redeem them. A mere
inquiry from an improper officeat that, could not, by any stretch, be considered as
an act of having raised the jurisdictional question prior to the rendition of the trial
courts decision. In one case, it was held:
Here it is beyond dispute that respondents paid the full amount of docket fees as
assessed by the Clerk of Court of the Regional Trial Court of Malolos, Bulacan,Branch 17, where they filed the complaint. If petitioners believed that the
assessment was incorrect, they should have questioned it before the trial
court. Instead, petitioners belatedly question the alleged underpayment of docket
fees through this petition, attempting to support their position with the opinionand certification of the Clerk of Court of another judicial region. Needless tostate, such certification has no bearing on the instant case.
27(italics in the
original; emphasis and underscoring in the original)
The inequity resulting from the abrogation of the whole proceedings at this late
stage when the decision subsequently rendered was adverse to the father and
sons is precisely the evil being avoided by the equitable principle of estoppel.
No Intent to Defraud the Government
Assuming arguendothat the docket fees paid were insufficient, there is no proof of
bad faith to warrant a dismissal of the complaint, hence, the following doctrine
applies:
x x x In Sun Insurance Office, Ltd., (SIOL) v. Asuncion, this Court ruled that the filing
of the complaint or appropriate initiatory pleading and the payment of the
prescribed docket fee vest a trial court with jurisdiction over the subject matter or
nature of the action. If the amount of docket fees paid is insufficient considering
the amount of the claim, the clerk of court of the lower court involved or his duly
authorized deputy has the responsibility of making a deficiency assessment. The
party filing the case will be required to pay the deficiency, but jurisdiction is not
automatically lost.28
(underscoring supplied)
The assailed Resolution of August 4, 2009 held, however, that the above-quoteddoctrine does not apply since there was intent to defraud the government, citing
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one attendant circumstance the annotation of notices of lis pendenson real
properties owned by LLDC. It deduced:
From the foregoing, it is clear that a notice of lis pendensis availed of mainly in real
actions. Hence, when David,et al., sought the annotation of notices of lis
pendenson the titles of LLDC, they acknowledged that the complaint they had filed
affected a title to or a right to possession of real properties. At the very least, they
must have been fully aware that the docket fees would be based on the value of
the realties involved. Their silence or inaction to point this out to the Clerk of Court
who computed their docket fees, therefore, becomes highly suspect, and thus,sufficient for this Court to conclude that they have crossed beyond the threshold
of good faith and into the area of fraud. Clearly, there was an effort to defraud the
government in avoiding to pay the correct docket fees. Consequently, the trial
court did not acquire jurisdiction over the case.29
All findings of fraud should begin the exposition with the presumption of good
faith. The inquiry is not whether there was good faith on the part of David, et al.,
but whether there was bad faith on their part.
The erroneous annotation of a notice of lis pendensdoes not negate good faith.
The overzealousness of a party in protectingpendente litehis perceived interest,
inchoate or otherwise, in the corporations properties from depletion or
dissipation, should not be lightly equated to bad faith.That notices of lis pendenswere erroneously annotated on the titles does not have
the effect of changing the nature of the action. The aggrieved party is not left
without a remedy, for they can move to cancel the annotations. The assailed
August 4, 2009 Resolution, however, deemed such act as an acknowledgement
that the case they filed was a real action, concerning as it indirectly does the
corporate realties, the titles of which were allegedly annotated. This conclusion
does not help much in ascertaining the filing fees because the value of these real
properties and the value of the 600,000 shares of stock are different.
Further, good faith can be gathered from the series of amendments on the
provisions on filing fees, that the Court was even prompted to make a
clarification.1avvphi1
When David Lu, et al. filed the Complaint on August 14, 2000 or five days after theeffectivity of the Securities Regulation Code or Republic Act No. 8799,
30the then
Section 7 of Rule 141 was the applicable provision, without any restricted
reference to paragraphs (a) and (b) 1 & 3 orparagraph (a) alone. Said section then
provided:
SEC. 7. Clerks of Regional Trial Courts.
(a) For filing an action or a permissive counterclaim or money claim against an
estate not based on judgment, or for filing with leave of court a third-party, fourth-
party, etc. complaint, or a complaint in intervention, and for all clerical services in
the same, if the total sum claimed, exclusive of interest, orthestated value of theproperty in litigation, is:
x x x x(b) For filing:
1. Actions where the value of the subject mattercannot be estimated
... x
x x
2. Special civil actions except judicial foreclosure
of mortgage which shall be governed by
paragraph (a) above
..... x
x x
3.All other actions not involving property
. x
x x
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.
x x x x31
(emphasis supplied)
The Court, by Resolution of September 4, 2001 in A. M. No. 00-8-10-SC ,32
clarified
the matter of legal fees to be collected in cases formerly cognizable by the
Securities and Exchange Commission following their transfer to the RTC.
Clarification has been sought on the legal fees to be collected and the period of
appeal applicable in cases formerly cognizable by the Securities and Exchange
Commission. It appears that the Interim Rules of Procedure on Corporate
Rehabilitation and the Interim Rules of Procedure for Intra-CorporateControversies do not provide the basis for the assessment of filing fees and the
period of appeal in cases transferred from the Securities and Exchange
Commission to particular Regional Trial Courts.
The nature of the above mentioned cases should first be ascertained. Section 3(a),
Rule 1 of the 1997 Rules of Civil Procedure defines civil action as one by which a
party sues another for the enforcement or protection of a right, or the prevention
or redress of a wrong. It further states that a civil action may either be ordinary or
special, both being governed by the rules for ordinary civil actions subject to the
special rules prescribed for special civil actions. Section 3(c) of the same Rule,
defines a special proceeding as a remedy by which a party seeks to establish a
status, a right, or a particular fact.
Applying these definitions, the cases covered by the Interim Rules for Intra-Corporate Controversies should be considered as ordinary civil actions. Thesecases either seek the recovery of damages/property or specific performance ofan act against a party for the violation or protection of a right. These cases are:(1) Devices or schemes employed by, or any act of, the board of directors, business
associates, officers or partners, amounting to fraud or misrepresentation which
may be detrimental to the interest of the public and/or of the stockholders,
partners, or members of any corporation, partnership, or association;
(2) Controversies arising out of intra-corporate, partnership, or association
relations, between and among stockholders, members or associates; and between,
any or all of them and the corporation, partnership, or association of which they
are stockholders, members or associates, respectively;
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(3) Controversies in the election or appointment of directors, trustees, officers, or
managers of corporations, partnerships, or associations;
(4) Derivative suits; and
(5) Inspection of corporate books.
On the other hand, a petition for rehabilitation, the procedure for which is
provided in the Interim Rules of Procedure on Corporate Recovery, should be
considered as a special proceeding. It is one that seeks to establish the status of a
party or a particular fact. As provided in section 1, Rule 4 of the Interim Rules on
Corporate Recovery, the status or fact sought to be established is the inability ofthe corporate debtor to pay its debts when they fall due so that a rehabilitation
plan, containing the formula for the successful recovery of the corporation, may be
approved in the end. It does not seek a relief from an injury caused by another
party.
Section 7 of Rule 141 (Legal Fees) of the Revised Rules of Court lays the amount of
filing fees to be assessed for actions or proceedings filed with the Regional Trial
Court. Section 7(a) and (b) apply to ordinary civil actionswhile 7(d) and (g) applyto special proceedings.
In fine, the basis for computing the filing fees in intra-corporate cases shallbe section 7(a) and (b) l & 3of Rule 141. For petitions for rehabilitation, section
7(d) shall be applied. (emphasis and underscoring supplied)The new Section 21(k) of Rule 141 of the Rules of Court, as amended by A.M. No.04-2-04-SC
33(July 20, 2004), expressly provides that "[f]or petitions for insolvency
or other cases involving intra-corporate controversies, the fees prescribed
under Section 7(a) shall apply." Notatu dignumis that paragraph(b) 1 & 3ofSection 7 thereof was omitted from the reference. Said paragraph
34refers to
docket fees for filing "[a]ctions where the value of the subject matter cannot be
estimated" and "all other actions not involving property."
By referring the computation of such docket fees to paragraph (a)only, it denotesthat an intra-corporate controversy always involves a property in litigation, the
value of which is always the basis for computing the applicable filing fees. The
latest amendments seem to imply that there can be no case of intra-corporate
controversy where the value of the subject matter cannot be estimated. Even onefor a mere inspection of corporate books.
If the complaint were filed today, one could safely find refuge in the express
phraseology of Section 21 (k) of Rule 141 that paragraph (a) alone applies.
In the present case, however, the original Complaint was filed on August 14, 2000
during which time Section 7, without qualification, was the applicable provision.
Even the Amended Complaint was filed on March 31, 2003 during which time the
applicable rule expressed that paragraphs (a) and (b) l & 3 shall be the basis for
computing the filing fees in intra-corporate cases, recognizing that there could be
an intra-corporate controversy where the value of the subject matter cannot be
estimated, such as an action for inspection of corporate books. The immediate
illustration shows that no mistake can even be attributed to the RTC clerk of courtin the assessment of the docket fees.
Finally, assuming there was deficiency in paying the docket fees and assuming
further that there was a mistake in computation, the deficiency may be considered
a lien on the judgment that may be rendered, there being no established intent to
defraud the government.
WHEREFORE, the assailed Resolutions of August 4, 2009 and September 23, 2009
are REVERSED andSET ASIDE. The Courts Decision of August 26, 2008is REINSTATED.The Court of Appeals is DIRECTED to resume the proceedings and resolve the
remaining issues with utmost dispatch in CA-G.R. CV No. 81163.SO ORDERED.
Republic of the Philippines
Supreme Court
Manila
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THIRD DIVISION
ANA DE GUIA SAN PEDROand ALEJO DOPEO,Petitioners,
- versus -
HON. FATIMA G. ASDALA, in her capacity as the PresidingJudge of the Regional Trial Court of Quezon City, Branch 87;
HON. MANUEL TARO, in his capacity as the Presiding Judge ofthe Metropolitan Trial Court of Quezon City, Branch 42; andthe HEIRS OF SPOUSES APOLONIO V. DIONISIO and VALERIANADIONISIO (namely, ALLAN GEORGE R. DIONISIO and ELEANORR. DIONISIO, herein represented by ALLAN GEORGE R.DIONISIO),Respondents.
G.R. No.164560
Present:
YNARES-SANTIAGO,J.,
Chairperson,
CHICO-
NAZARIO,
VELASCO, JR.,
NACHURA, and
PERALTA,JJ.
Promulgated:July 22, 2009
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
D E C I S I O N
PERALTA,J.:
This resolves the petition for certiorariunder Rule 65 of the Rules of Court, praying
that the Resolutions[1]
of the Court of Appeals (CA) dated September 15,
2003 andJune 1, 2004, respectively, in CA-G.R. SP No. 78978, be reversed and set
aside.
The antecedent facts are as follows.
Sometime in July 2001, private respondents, heirs of spouses Apolonio and
Valeriana Dionisio, filed with the Metropolitan Trial Court (MeTC) of Quezon City,
Branch 42, a Complaint[2]
against herein petitioners and Wood Crest Residents
Association, Inc., forAccion Reivindicatoria, Quieting of Title and Damages, withPrayer for Preliminary Mandatory Injunction. Private respondents alleged that
subject property located in Batasan Hills, Quezon City, with an assessed value
of P32,100.00, was titled in the name of spouses Apolonio and Valeriana Dionisio;
but petitioners, with malice and evident bad faith, claimed that they were the
owners of a parcel of land that encompasses and covers subject property. Private
respondents had allegedly been prevented from entering, possessing and using
subject property. It was further alleged in the Complaint that petitioners' Transfer
Certificate of Title over their alleged property was spurious. Private respondents
then prayed that they be declared the sole and absolute owners of the subject
property; that petitioners be ordered to surrender possession of subject propertyto them; that petitioners and Wood Crest and/or its members be ordered to pay
actual and moral damages, and attorney's fees.
Petitioners, for their part, filed a Motion to Dismiss[3]
said complaint on the ground
that the MeTC had no jurisdiction over the subject matter of the action, as the
subject of litigation was incapable of pecuniary estimation.
The MeTC then issued an Order[4]
dated July 4, 2002 denying the motion to
dismiss, ruling that, under Batas Pambansa(B.P.) Blg.129, as amended, the MeTC
had exclusive original jurisdiction over actions
involving title to or possession of real property of small value.
Petitioners' Motion for Reconsideration of said Order dated July 4, 2002 was
denied.
Petitioners assailed the aforementioned Order by filing a petition
for certiorari with the Regional Trial Court (RTC) of Quezon City, Branch
87. However, in its Decision[5]
dated March 10, 2003, the RTC dismissed the
petition, finding no grave abuse of discretion on the part of the MeTC Presiding
Judge. The RTC sustained the MeTC ruling, stating that, in accordance with Section
33(3) of Republic Act (R.A.) No. 7691, amending B.P. Blg. 129, the MeTC had
jurisdiction over the complaint forAccion Reivindicatoria,as it involves recovery of
ownership and possession of real property located in Quezon City, with anassessed value not exceeding P50,000.00. A Motion for Reconsideration
[6]of the
Decision was filed by petitioners, but was denied in an Order[7]
dated July 3, 2003.
Petitioners then filed with the Court of Appeals another petition
for certiorari, insisting that both the MeTC and RTC acted with grave abuse of
discretion amounting to lack or excess of jurisdiction by not ordering the dismissal
of the complaint forAccion Reivindicatoria,for lack of jurisdiction over the
same. In the assailed CA Resolution dated September 15, 2003, the CA dismissed
the petition outright, holding that certiorariwas not available to petitioners as they
should have availed themselves of the remedy of appeal. Petitioners' motion for
reconsideration of the resolution of dismissal was denied perResolution
[8]dated June 1, 2004.
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Thus, petitioners filed the instant petition and, in support thereof, they allege that:
THE HONORABLE COURT OF APPEALS ACTED WITH GRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK OR IN (SIC) EXCESS OF JURISDICTION IN DENYING THE
PETITION FOR CERTIORARI AND FOR FAILURE TO RESOLVE THE ISSUE RAISED IN
THE CERTIORARIREGARDING THE JURISDICTION OF THE METROPOLITAN TRIAL
COURT TO TAKE COGNIZANCE OF A CASE OFACCION REINVINDICATORIA.
THE HONORABLE PUBLIC RESPONDENT FATIMA GONZALES-ASDALA, AS PRESIDING
JUDGE OF RTC BRANCH 87, QUEZON CITY, ACTED WITH GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OR IN EXCESS OF (SIC) JURISDICTION IN
DISMISSING THE PETITION FOR CERTIORARIAND IN RESOLVING THAT A CASE
OFACCION REINVINDICATORIAIS WITHIN THE JURISDICTION OF THE
METROPOLITAN TRIAL COURT.
THE HONORABLE PUBLIC RESPONDENT MANUEL TARO AS PRESIDING JUDGE
MeTC, BRANCH 42, QUEZON CITY, ACTED WITH GRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK OR IN (SIC) EXCESS OF JURISDICTION IN SO TAKING
COGNIZANCE OF THE COMPLAINT FORACCION REINVINDICATORIA IN CIVIL CASE
NO. 27434 ENTITLED, HEIRS OF SPS. APOLONIO V. DIONISIO AND VALERIANA
DIONISIO, ETC. VS. ANA DE GUIA SAN PEDRO, ET. AL.[9]
The present Petition for Certiorariis doomed and should not have been
entertained from the very beginning.
The settled rule is that appeals from judgments or final orders or resolutions of the
CA should be by a verified petition for review on certiorari, as provided for under
Rule 45 of the Revised Rules of Civil Procedure. Thus, in Pasiona, Jr. v. Court of
Appeals,[10]the Court expounded as follows:
The aggrieved party is proscribed from assailing a decision or final order of the CA
via Rule 65, because such recourse is proper only if the party has no plain, speedy
and adequate remedy in the course of law. In this case, petitioner had anadequate remedy, namely, a petition for review on certiorariunder Rule 45 ofthe Rules of Court. A petition for review oncertiorari, not a special civil actionfor certiorariwas, therefore, the correct remedy.
x x x x
Settled is the rule that where appeal is available to the aggrieved party, the specialcivil action for certiorariwill not be entertained remedies of appeal
and certiorariare mutually exclusive, not alternative or
successive. Hence, certiorariis not and cannot be a substitute for a lostappeal,especially if one's own negligence or error in one's choice of remedyoccasioned such loss or lapse. One of the requisites of certiorariis that there be no
available appeal or any plain, speedy and adequate remedy. Where an appeal wasavailable, as in this case, certiorariwill not prosper, even if the ground therefor isgrave abuse of discretion. Petitioner's resort to this Court by Petitionfor Certiorariwas a fatal procedural error, and the instant petition must, therefore,
fail.[11]
For the very same reason given above, the CA, therefore, acted properly when it
dismissed the petition for certiorari outright, on the ground that petitioners should
have resorted to the remedy of appeal instead of certiorari. Verily, the present
Petition for Certiorarishould not have been given due course at all.
Moreover, since the period for petitioners to file a petition for review
on certiorarihad lapsed by the time the instant petition was filed, the assailed CA
Resolutions have attained finality.
Nevertheless, just to put the matter to rest, the Court reiterates the ruling in Heirs
of Valeriano S. Concha, Sr. v. Spouses Lumocso,[12]
to wit:
In a number of cases, we have held that actions for reconveyance of or for
cancellation of title to or to quiet title over real property are actions that fall under
the classification of cases that involve title to, or possession of, real property, or
any interest therein.
x x x x
x x x Thus, under the old law, there was no substantial effect on jurisdiction
whether a case is one, the subject matter of which was incapable of pecuniary
estimation, under Section 19(1) of B.P. 129, or one involving title to property under
Section 19(2). The distinction between the two classes became crucial with the
amendment introduced by R.A. No. 7691 in 1994, which expanded the exclusive
original jurisdiction of the first level courts to include "all civil actions which involvetitle to, or possession of, real property, or any interest therein where the assessedvalue 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 doesnot exceed Fifty thousand pesos (P50,000.00) exclusive of interest, damages ofwhatever kind, attorney's fees, litigation expenses and costs. " Thus, under thepresent law, original jurisdiction over cases the subject matter of which involves"title to, possession of, real property or any interest therein" under Section 19(2)of B.P. 129 is divided between the first and second level courts, with the assessedvalue of the real property involved as the benchmark. This amendment wasintroduced to "unclog the overloaded dockets of the RTCs which would result in
the speedier administration of justice."
[13]
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Clearly, the RTC and the CA ruled correctly that the MeTC had jurisdiction over
private respondents' complaint forAccion Reivindicatoria.
IN VIEW OF THE FOREGOING, the petition is DISMISSEDfor utter lack ofmerit. The Resolutions of the Court of Appeals in CA-G.R. SP No. 78978,
datedSeptember 15, 2003 and June 1, 2004, are AFFIRMED.
SO ORDERED.
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SECOND DIVISIONG.R. No. 174908, June 17, 2013DARMA MASLAG,Petitioner, v. AND ELIZABETH MONZON, WILLIAM GESTON,REGISTRY OF DEEDS OF BENGUET,Respondents.
D E C I S I O N DEL CASTILLO,J.:"It is incumbent upon x x x appellants to utilize the correct mode of appeal of the
decisions of trial courts to the appellate courts. In the mistaken choice of theirremedy, they can blame no one but themselves."
1
This is a Petition for Review on Certiorari2of the May 31, 2006 Resolution
3of the
Court of Appeals (CA) in CA-G.R. CV No. 83365, which dismissed petitioner Darma
Maslags (petitioner) ordinary appeal to it for being an improper remedy. The
Resolution disposed of the case as follows:cralavvonlinelawlibrary
WHEREFORE, the Motion to Dismiss is GRANTED, and the Appeal isherebyDISMISSED.
SO ORDERED.4nadcralavvonlinelawlibrary
The Petition also assails the CAs September 22, 2006 Resolution5denying
petitioners Motion for Reconsideration.6
Factual Antecedents
In 1998, petitioner filed a Complaint7for reconveyance of real property with
declaration of nullity of original certificate of title (OCT) against respondents
Elizabeth Monzon (Monzon), William Geston and the Registry of Deeds of La
Trinidad, Benguet. The Complaint was filed before the Municipal Trial Court (MTC)
of La Trinidad, Benguet.
After trial, the MTC found respondent Monzon guilty of fraud in obtaining an OCTover petitioners property.
8 It ordered her to reconvey the said property to
petitioner, and to pay damages and costs of suit.9
Respondents appealed to the Regional Trial Court (RTC) of La Trinidad, Benguet.
After going over the MTC records and the parties respective memoranda, the RTC
of La Trinidad, Benguet, Branch 10, through Acting Presiding Judge Fernando P.
Cabato (Judge Cabato), issued its October 22, 2003 Order,10
declaring the MTC
without jurisdiction over petitioners cause of action. It further held that it will
take cognizance of the case pursuant to Section 8, Rule 40 of the Rules of Court,
which reads:cralavvonlinelawlibrary
SECTION 8. Appeal from orders dismissing case without trial; lack of jurisdiction.
x x x
If the case was tried on the merits by the lower court without jurisdiction over the
subject matter, the Regional Trial Court on appeal shall not dismiss the case if it
has original jurisdiction thereof, but shall decide the case in accordance with the
preceding section, without prejudice to the admission of amended pleadings and
additional evidence in the interest of justice.
Both parties acknowledged receipt of the October 22, 2003 Order,11
but neither
presented additional evidence before the new judge, Edgardo B. Diaz De Rivera, Jr.
(Judge Diaz De Rivera).12
On May 4, 2004, Judge Diaz De Rivera issued a Resolution13
reversing the MTC
Decision. Thefalloreads as follows:cralavvonlinelawlibrary
WHEREFORE, the Judgment appealedfrom the Municipal Trial Court of La
Trinidad, Benguet is set aside. [Petitioner] is ordered to turn over the possession
of the 4,415 square meter land she presently occupies to [Monzon]. This case
is remanded to the court a quofor further proceedings to determine whether
[Maslag] is entitled to the remedies afforded by law to a builder in good faith for
the improvements she constructed thereon.
No pronouncement as to damages and costs.
SO ORDERED.14
Petitioner filed a Notice of Appeal15
from the RTCs May 4, 2004 Resolution.
Petitioner assailed the RTCs May 4, 2004 Resolution for reversingthe MTCs
factual findings16
and prayed that the MTC Decision be adopted. Her prayer before
the CA reads:cralavvonlinelawlibrary
WHEREFORE, premises considered, it is most respectfully prayed that the decisionof the Regional Trial Court, Branch 10 of La Trinidad, Benguet, appealed from be
reversedin totoand that the Honorable Court adopt the decision of the Municipal
Trial Court. Further reliefs just and equitable under the premises are prayed for.17
Respondents moved to dismiss petitioners ordinary appeal for being the improper
remedy. They asserted that the proper mode of appeal is a Petition for Review
under Rule 42 because the RTC rendered its May 4, 2004 Resolution in its appellate
jurisdiction.18
Ruling of the Court of Appeals
The CA dismissed petitioners appeal. It observed that the RTCs May 4, 2004
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Resolution (the subject matter of the appeal before the CA) set asidean MTC
Judgment; hence, the proper remedy is a Petition for Review under Rule 42, and
not an ordinary appeal.19
Petitioner sought reconsideration.20
She argued, for the first time, that the RTC
rendered its May 4, 2004 Resolution in its original jurisdiction. She cited the earlier
October 22, 2003 Order of the RTC declaring the MTC without jurisdiction over the
case.
The CA denied petitioners Motion for Reconsideration in its September 22, 2006
Resolution:21
A perusal of the May 4, 2004 Resolution of the RTC, which is the subject matter of
the appeal, clearly reveals that it took cognizance of the MTC case in the exercise
of its appellate jurisdiction. Consequently, as We have previously enunciated, the
proper remedy, is a petition for review under Rule 42 and not an ordinary appeal
under Rule 41.
WHEREFORE, premises considered, the instant Motion for Reconsiderationis DENIED. The May 31, 2006 Resolution of this Court is hereby AFFIRMED in toto.
SO ORDERED.22
Hence this Petition wherein petitioner prays that the CA be ordered to take
cognizance of her appeal.23
Issues
Petitioner set forth the following issues in her Petition:cralavvonlinelawlibrary
WHETHER X X X THE COURT OF APPEALS WAS CORRECT IN DISMISSING THE
APPEAL FILED BY THE PETITIONER, CONSIDERING THAT THE REGIONAL TRIAL
COURT, BRANCH 10 OF LA TRINIDAD, BENGUET HELD THAT THE ORIGINAL
COMPLAINT AS FILED BEFORE THE MUNICIPAL TRIAL COURT OF LA TRINIDAD,
BENGUET WAS DECIDED BY THE LATTER WITHOUT ANY JURISDICTION AND, INORDERING THAT THE CASE SHALL BE DECIDED PURSUANT TO THE PROVISION OF
SECTION 8 OF RULE 40 OF THE RULES OF COURT, IT DECIDED THE CASE NOT ON ITS
APPELLATE JURISDICTION BUT ON ITS ORIGINAL JURISDICTION
WHAT WILL BE THE EFFECT OF THE DECISION OF THE REGIONAL TRIAL COURT,
BRANCH 10 OF LA TRINIDAD, BENGUET, WHEN IT DECIDED A CASE APPEALED
BEFORE IT UNDER THE PROVISION OF SECTION 8, RULE 40 OF THE RULES OF
COURT OF THE PHILIPPINES, AS TO THE COURSE OF REMEDY THAT MAY BE
AVAILED OF BY THE PETITIONERA PETITION FOR REVIEW UNDER RULE 42 OR AN
ORDINARY APPEAL UNDER RULE 41.24
nadcralavvonlinelawlibrary
Our Ruling
In its October 22, 2003 Order, the RTC declared that the MTC has no jurisdiction
over the subject matter of the case based on the supposition that the same is
incapable of pecuniary estimation. Thus, following Section 8, Rule 40 of the Rules
of Court, it took cognizance of the case and directed the parties to adduce further
evidence if they so desire. The parties bowed to this ruling of the RTC and,
eventually, submitted the case for its decision after they had submitted their
respective memoranda.
We cannot, however, gloss over this jurisdictionalfaux pasof the RTC. Since it
involves a question of jurisdiction, we may motu proprioreview and pass upon the
same even at this late stage of the proceedings.25
In her Complaint26
for reconveyance of real property with declaration of nullity of
OCT, petitioner claimed that she and her father had been in open, continuous,
notorious and exclusive possession of the disputed property since the 1940s. She
averred:cralavvonlinelawlibrary
7. Sometime in the year 1987, Elizabeth Monzon, the owner of the adjacent parcel
of land being occupied by plaintiff [Maslag], informed the plaintiff that the
respective parcels of land being claimed by them can now be titled. A suggestion
was, thereafter made, that those who were interested to have their lands titled,
will contribute to a common fund for the surveying and subsequent titling of the
land;chanroblesvirtualawlibrary
8. Since plaintiff had, for so long, yearned for a title to the land she occupies, she
contributed to the amount being requested by Elizabeth
Monzon;chanroblesvirtualawlibrary
9. A subdivision survey was made and in the survey, the respective areas of the
plaintiff and the defendants were defined and delimited all for purposes of
titling. x x x
10. But alas, despite the assurance of subdivided titles, when the title was finally
issued by the Registry of Deeds, the same was only in the name of Elizabeth
Monzon and WILLIAM GESTON. The name of Darma Maslag was fraudulently,
deliberately and in bad faith omitted. Thus, the title to the property, to the extent
of 18,295 square meters, was titled solely in the name of ELIZABETH MONZON.
As a relief, petitioner prayed that Monzon be ordered to reconvey the portion of
the property which she claimed was fraudulently included in Monzons title. Her
primary relief was to recover ownership of real property. Indubitably, petitioners
complaint involves title to real property. An action "involving title to real
property," on the other hand, was defined as an action where "the plaintiffs causeof action is based on a claim that [she] owns such property or that [she] has the
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legal rights to have exclusive control, possession, enjoyment, or disposition of the
same."27
Under the present state of the law, in cases involving title to real
property, original and exclusive jurisdiction belongs to either the RTC or the MTC,
depending on the assessed value of the subject property.28
Pertinent provisions of
Batas Pambansa Blg. (BP) 129,29
as amended by Republic Act (RA) No.
7691,30
provides:cralavvonlinelawlibrary
Sec. 19.Jurisdiction in civil cases. Regional Trial Courts shall exercise exclusive
original jurisdiction:cralavvonlinelawlibrary
(1) In all civil actions in which the subject of the litigation is incapable of pecuniary
estimation;chanroblesvirtualawlibrary
(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 x x
x the [assessed] value [of the property] exceeds Fifty thousand pesos
([P]50,000.00) except actions for forcible entry into and unlawful detainer of lands
or buildings, original jurisdiction over which is conferred upon Metropolitan Trial
Courts, Municipal Trial Courts, and Municipal Circuit Trial
Courts;chanroblesvirtualawlibrary
x x x x
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) x x x.
In the case at bench, annexed to the Complaint is a Declaration of Real
Property31
dated November 12, 1991, which was later marked as petitioners
Exhibit "A",32
showing that the disputed property has an assessed value of
P12,40033
only. Such assessed value of the property is well within the jurisdiction
of the MTC. In fine, the RTC, thru Judge Cabato, erred in applying Section 19(1) of
BP 129 in determining which court has jurisdiction over the case and in
pronouncing that the MTC is divested of original and exclusive jurisdiction.
This brings to fore the next issue of whether the CA was correct in dismissing
petitioners appeal.
Section 2, Rule 50 of the Rules of Court provides for the dismissal of an improper
appeal:cralavvonlinelawlibrary
SECTION 2. Dismissal of improper appeal to the Court of Appeals. An appeal
under Rule 41 taken from the Regional Trial Court to the Court of Appeals raising
only questions of law shall be dismissed, issues purely of law not being reviewable
by said court. Similarly, an appeal by notice of appeal instead of by petition forreview from the appellate judgment of a Regional Trial Court shall be dismissed.
An appeal erroneously taken to the Court of Appeals shall not be transferred to theappropriate court but shall be dismissed outright. (Emphasis supplied)
There are two modes of appealing an RTC decision or resolution on issues of fact
and law.34
The first mode is an ordinary appeal under Rule 41 in cases where the
RTC exercised its original jurisdiction. It is done by filing a Notice of Appeal with
the RTC. The second mode is apetition for review under Rule 42 in cases where
the RTC exercised its appellate jurisdictionover MTC decisions. It is done by filing a
Petition for Review with the CA. Simply put, the distinction between these two
modes of appeal lies in the type of jurisdiction exercised by the RTC in the Order or
Decision being appealed.
As discussed above, the MTC has original and exclusive jurisdiction over the subject
matter of the case; hence, there is no other way the RTC could have taken
cognizance of the case and review the court a quosJudgment except in the
exercise of its appellate jurisdiction. Besides, the new RTC Judge who penned the
May 4, 2004 Resolution, Judge Diaz de Rivera, actually treated the case as an
appeal despite the October 22, 2003 Order. He started his Resolution by stating,
"This is an appeal from the Judgment rendered by the Municipal Trial Court (MTC)
of La Trinidad Benguet"35
and then proceeded to discuss the merits of the
"appeal." In the dispositive portion of said Resolution, he reversed the MTCs
findings and conclusions and remanded residual issues for trial with the
MTC.36
Thus, in fact and in law, the RTC Resolution was a continuation of the
proceedings that originated from the MTC. It was a judgment issued by the RTC inthe exercise of its appellate jurisdiction. With regard to the RTCs earlier October
22, 2003 Order, the same should be disregarded for it produces no effect (other
than to confuse the parties whether the RTC was invested with original or
appellate jurisdiction). It cannot be overemphasized that jurisdiction over the
subject matter is conferred only by law and it is "not within the courts, let alone
the parties, to themselves determine or coveniently set aside."37
Neither would
the active participation of the parties nor estoppeloperate to confer original and
exclusive jurisdiction where the court or tribunal only wields appellate jurisdiction
over the case.38
Thus, the CA is correct in holding that the proper mode of appeal
should have been a Petition for Review under Rule 42 of the Rules of Court, and
not an ordinary appeal under Rule 41.
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Seeing the futility of arguing against what the RTC actually did, petitioner resorts to
arguing for what the RTC should have done. She maintains that the RTC should
have issued its May 4, 2004 Resolution in its original jurisdiction because it had
earlier ruled that the MTC had no jurisdiction over the cause of action.
Petitioners argument lacks merit. To reiterate, only statutes can confer
jurisdiction. Court i ssuances cannot seize or appropriate jurisdiction. It has been
repeatedly held that "any judgment, order or resolution issued without
[jurisdiction] is void and cannot be given any effect."39
By parity of reasoning, anorder issued by a court declaring that it has original and exclusive jurisdiction over
the subject matter of the case when under the law it has none cannot likewise be
given effect. It amounts to usurpation of jurisdiction which cannot be
countenanced. Since BP 129 already apportioned the jurisdiction of the MTC and
the RTC in cases involving title to property, neither the courts nor the petitioner
could alter or disregard the same. Besides, in determining the proper mode of
appeal from an RTC Decision or Resolution, the determinative factor is the type of
jurisdiction actually exercised by the RTC in rendering its Decision or
Resolution. Was it rendered by the RTC in the exercise of its original jurisdiction,
or in the exercise of its appellate jurisdiction? In short, we look at what type of
jurisdiction was actually exercisedby the RTC. We do not look into what type of
jurisdiction the RTC should haveexercised. This is but logical. Inquiring into what
the RTC should have done in disposing of the case is a question which already
involves the merits of the appeal, but we obviously cannot go into that where the
mode of appeal was improper to begin with.
WHEREFORE, premises considered, the Petition for Review is DENIED for lack ofmerit. The assailed May 31, 2006 and September 22, 2006 Resolutions of the
Court of Appeals in CA-G.R. CV No. 83365 are AFFIRMED.
SO ORDERED.
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Primero instituted proceedings against DM with the Labor Arbiters of the
Department of Labor, for illegal dismissal, and for recovery of back wages and
reinstatement. It is not clear from the record whether these proceedings consisted
of one or two actions separately filed. What is certain is that he withdrew his
claims for back wages and reinstatement, "with the end in view of filing a damage
suit" "in a civil court which has exclusive jurisdiction over his complaint for
damages on causes of action founded on tortious acts, breach of employment
contract ... and consequent effects (thereof ).2
In any case, after due investigation, the Labor Arbiter rendered judgment dated
January 24, 1977 ordering DM to pay complainant Primero P2,000.00 as separation
pay in accordance with the Termination Pay Law.3The judgment was affirmed by
the National Labor Relations Commission and later by the Secretary of Labor, the
case having been concluded at this level on March 3, 1978.4
Under the provisions of the Labor Code in force at that time, Labor Arbiters had
jurisdiction inter aliaover
1) claims involving non-payment or underpayment of wages,
overtime compensation, social security and medicare benefits,and
2) all other cases or matters arising from employer-employee
relations, unless otherwise expressly excluded.5
And we have since held that under these "broad and comprehensive" terms of the
law, Labor Arbiters possessed original jurisdiction over claims for moral and other
forms of damages in labor disputes.6
The jurisdiction of Labor Arbiters over such claims was however removed by PD
1367, effective May 1, 1978, which explicitly provided that "Regional Directorsshall not indorse and Labor Arbiters shall not entertain claims for moral or other
forms of damages."7
Some three months afterwards, Primero brought suit against DM in the Court of
First Instance of Rizal seeking recovery of damages caused not only by the breach
of his employment contract, but also by the oppressive and inhuman, and
consequently tortious, acts of his employer and its officers antecedent and
subsequent to his dismissal from employment without just cause.8
While this action was pending in the CFI, the law governing the Labor Arbiters'
jurisdiction was once again revised. The amending act was PD 1691, effective May1, 1980. It eliminated the restrictive clause placed by PD 1367, that Regional
Directors shall not indorse and Labor Arbiters entertain claims for moral or other
forms of damages. And, as we have had occasion to declare in several cases, it
restored the principle that "exclusive and original jurisdiction for damages would
once again be vested in labor arbiters;" eliminated "the rather thorny question as
to where in labor matters the dividing line is to be drawn between the power
lodged in an administrative body and a court;' " and, "in the interest of greater
promptness in the disposition of labor matters, ... spared (courts of) the often
onerous task of determining what essentially is a factual matter, namely, the
damages that may be incurred by either labor or management as a result ofdisputes or controversies arising from employer-employee
relations."9Parenthetically, there was still another amendment of the provision in
question which, however, has no application to the case at bar. The amendment
was embodied in B.P. Blg. 227, effective June 1, 1
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