SECOND DIVISION compliance by the latter of certain conditions and only upon compliance therewith may

what is legally due him under the written contract be demanded, the action is one not
capable of pecuniary estimation. The payment of a sum of money is only incidental which
G.R. No. L-36098 January 21, 1983
can only be ordered after a determination of certain acts the performance of which being
the more basic issue to be inquired into.
ORTIGAS & COMPANY, LIMITED PARTNERSHIP, petitioner, vs.
JUDGE JOSE B. HERRERA, respondent.
Although private respondent's complaint in the court a quo  is designated as one for a sum
of money and damages, an analysis of all the factual allegations of the complaint patently
RESOLUTION shows that what private respondent seeks is the performance of petitioner's obligation
under the written contract to make the refund of the rate of P10.00 per square meter or
in the total amount of P4,820.00, but only after proof of having himself fulfilled the
PER CURIAM: conditions that will give rise to petitioner's obligation, a matter clearly incapable of
pecuniary estimation.
G.R. No. L-36098 (Ortigas & Company, Limited Partnership vs. Judge Jose B. Herrera,
City Court of Manila, Branch II, and Emiliano Samson). – On August 14, 1969, petitioner In view of the foregoing, the Court RESOLVED to reverse the order appealed from and the
and private respondent entered into an agreement thereby for and in consideration of complaint filed with the City Court of Manila, Branch II, docketed as Civil Case No.
P55,430.00, the former agreed to sell to the latter a parcel of land with a special condition 211673 is hereby ordered dismissed for lack of jurisdiction.
that should private respondent as purchaser complete the construction including the
painting of his residential house on said lot within two (2) years from August 14, 1969,
petitioner, as owner, has agreed to refund to private respondent the amount of P10.00
per square meter. When the aforesaid special condition was fulfilled, private respondent,
on May 17, 1971 accordingly notified in writing the petitioner of the same and requested
for his refund amounting to P4,820.00.

Upon failure of petitioner to pay his obligation, private respondent on May 6, 1972 filed a
complaint for sum of money and damages with the City Court of Manila, Branch II,
against petitioner docketed as Civil Case No. 211673. A motion to dismiss was filed by
petitioner on grounds of lack of jurisdiction, failure of the complaint to state a cause of
action and improper avenue. City Court Judge Jose B. Herrera in his order dated June 27,
1972 held in abeyance the resolution on the motion until after the trial of the case on the
merits.

A reconsideration of the said order having been denied, petitioner on October 12, 1972
filed with the Court of First Instance of Manila Branch XXVII, a special civil action for
certiorari and prohibition with preliminary injunction docketed as Civil Case No. 88510. A
motion to dismiss was filed by private respondent, and on November 17, 1972, the
petition was dismissed on the ground that the claim of private respondent in his
complaint, being less than P10,000.00, is within the exclusive jurisdiction of the city
court.

Petitioner thus filed the present petition and argues among others that: (a) as determined
from the allegations of the complaint, the action is for specific performance of contract;
and (b) actions in which the subject of litigation is not capable of pecuniary estimation
such as complaints for specific performance of contract are exclusively cognizable by the
Court of First Instance. Hence, the decisive question to be resolved in this present
petition is whether or not the City Court of Manila, Branch II, has jurisdiction over the
complaint.

The action involved in this case is one for specific performance and not for a sum of
money and wherefore incapable of pecuniary estimation because what private respondent
seeks is the performance of petitioner's obligation under a written contract to make a
refund but under certain specific conditions still to be proven or established. In a case for
the recovery of a sum of money, as the collection of a debt, the claim is considered
capable of pecuniary estimation (Lapitan vs. Scandia Inc., 24 SCRA 479) because the
obligation to pay the debt is not conditioned upon any specific fact or matter. But when a
party to a contract has agreed to refund to the other party a sum of money upon

Page 1 of 100
 SECOND DIVISION 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
G.R. No. 149243           October 28, 2002
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
LOLITA B. COPIOSO, petitioner, vs. thousand pesos (P20,000.00) or, in civil actions in Metro Manila, where such assessed
LAURO, DOLORES, RAFAEL, ESTEBAN, and CORAZON, all surnamed COPIOSO, value does not exceed fifty thousand pesos (P50,000.00) exclusive of interest, damages
and COURT OF APPEALS, respondents. 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.
DECISION

Petitioner argues that the complaint for reconveyance cannot be resolved unless the trial
BELLOSILLO, J.: court delves upon the issues of "title, possession and interests" of each of the
stakeholders over the subject parcels of land. She asserts that the allegations and relief
This petition for review assails the Decision 1 of the Court of Appeals in CA G.R. SP No. prayed for in the complaint coupled with the assessed value of the disputed property
62090 which dismissed petitioner's petition for certiorari as well as its Resolution denying place the action within the exclusive jurisdiction of the MTC and not the RTC.
reconsideration thereof.
In turn, private respondents anchor their position on Sec. 19, par. (1), of the same law
On 4 July 2000 respondents Lauro, Dolores, Rafael, Esteban and Corazon, all surnamed which provides -
Copioso, filed a complaint2 for reconveyance of two (2) parcels of coconut land situated in
Banilad, Nagcarlan, Laguna, against Lolita B. Copioso, spouses Bernabe and Imelda Doria, Sec. 19. Jurisdiction in civil cases. – The Regional Trial Courts shall exercise exclusive
and the estate of deceased Antonio Copioso, as well as vendees Dolores Reduca, original jurisdiction: In all civil actions in which the subject of the litigation is incapable of
Mercedes Reduca, Rosario Pascua, Elvira Bombasi and Federico Casabar. pecuniary estimation: x x x

Respondents alleged that they together with their deceased brother Antonio Copioso were Simply, they claim that the instant complaint for reconveyance is a case of joinder of
co-owners of the subject property having inherited the same from their parents, and that causes of action which include the annulment of sale and other instruments of false
through fraud and machination Antonio had the property transferred to his name and that conveyance incapable of pecuniary estimation thus within the legal competence of the
of spouses Bernabe and Imelda Doria who subsequently sold the same to third parties. RTC.
They thus prayed for the reconveyance of the property by virtue of their being co-owners
thereof.
The law on jurisdiction of trial courts over civil cases is neither ambiguous nor confusing.
Sec. 33, par. (3), in relation to Sec. 19 par. (2) of B.P. 129 as amended by RA 7691,
When respondents claimed in a manifestation with motion for bill of particulars that the deals with civil cases capable of pecuniary estimation. On the other hand, Sec. 33, par.
assessed value of the subject property was P3,770.00, petitioner Lolita Copioso and (3), in relation to Sec. 19, par. (1), applies to cases incapable of pecuniary estimation.
spouses Bernabe and Imelda Doria separately moved to dismiss the complaint on the
ground that it was the Municipal Trial Court (MTC) and not the Regional Trial Court (RTC)
that had jurisdiction over the case considering that the assessed value of the property Sec. 33, par. (3), in relation to Sec. 19, par. (2), of B.P. 129, as amended by RA 7691,
was lower than P20,000.00. provides that in civil cases involving sum of money or title to, possession of, or any
interest in real property, jurisdiction is determined on the basis of the amount of the
claim or the assessed value of the real property involved, such that where the sum of
The trial court in its twin orders of 5 and 12 September 2000 denied the motions to money or the assessed value of the real property does not exceed P20,000.00,
dismiss holding that since the subject matter of the action was beyond pecuniary or P50,000.00 in Metro Manila, jurisdiction lies with the MTC; and where it exceeds that
estimation it was properly within its jurisdiction. 3 Lolita Copioso's Motion for amount, jurisdiction is vested with the RTC.
Reconsideration was denied,4 hence, she filed with the Court of Appeals a petition
for certiorari and prohibition praying for the annulment of the twin orders of the trial court
which denied the motions to dismiss and at the same time maintaining her position that Indeed, the present dispute pertains to the title, possession and interest of each of the
the RTC had no jurisdiction over the case because the assessed value of the property was contending parties over the contested property the assessed value of which falls within
below P20,000.00. the jurisdictional range of the MTC. Nonetheless, the nature of the action filed, the
allegations set forth, and the reliefs prayed for, forestall its cognizance by the MTC.
The appellate court denied the petition thus affirming the jurisdiction of the RTC over the
complaint for reconveyance. Motion for reconsideration thereon was similarly denied by As can be readily gleaned from the records, the complaint was for "Reconveyance and/or
the appellate court, hence this petition. Recovery of Common Properties Illegally Disposed, with Annulment of Sales and other
Instruments of False Conveyance, with Damages, and Restraining Order." Private
respondents alleged therein that they were co-owners of the property along with their
Petitioner Lolita Copioso anchors her argument on Sec. 33, par. (3), of B.P. Blg. 129 deceased brother Antonio Copioso; and that in or about 1998, with fraud and
otherwise known as The Judiciary Reorganization Act of 1980 as amended by Sec. 3 of RA machination, Antonio together with the spouses Bernabe and Imelda Doria made it
7691 which provides - appear in a public document entitled Pagpapatunay ng Kusang Loob na Pagbabahagi that
they were the co-owners of the subject property and had divided the same equally

Page 2 of 100
between themselves to the exclusion of private respondents. Subsequently, they sold the
subdivided lots to the other defendants namely Dolores Reduca, Mercedes Reduca,
Rosario Pascua, Elvira Bombasi and Federico Casabar.

Private respondents also sought payment of moral damages, exemplary damages,

litigation expenses, attorney's fees plus appearance fees amounting to more or
less P286,500.00. They likewise applied for a TRO pending the issuance of a writ of
preliminary injunction restraining the defendants from further alienating the common
properties. They also prayed of the trial court to order the cancellation, annulment and/or
rescission of the four (4) deeds of absolute sale made in favor of the buyers, and to order
Lolita B. Copioso and the estate of Antonio Copioso to return the price that the buyer-
defendants had paid to them for the land sold.

Clearly, this is a case of joinder of causes of action which comprehends more than the
issue of title to, possession of, or any interest in the real property under contention but
includes an action to annul contracts, reconveyance or specific performance, and a claim
for damages, which are incapable of pecuniary estimation and thus properly within the
jurisdiction of the RTC.

As correctly opined by the appellate court, if the only issue involved herein is naked
possession or bare ownership, then petitioner Lolita Copioso would not be amiss in her
assertion that the instant complaint for reconveyance, considering the assessed value of
the disputed property, falls within the exclusive jurisdiction of the MTC. But as herein
before stated, the issue of title, ownership and/or possession thereof is intertwined with
the issue of annulment of sale and reconveyance hence within the ambit of the
jurisdiction of the RTC. The assessed value of the parcels of land thus becomes merely an
incidental matter to be dealt with by the court, when necessary, in the resolution of the
case but is not determinative of its jurisdiction.

WHEREFORE, the petition is DENIED. The 16 May 2001 Decision of the Court of Appeals
in CA-G.R. SP No. 62090 as well as its 30 July 2001 Resolution denying reconsideration
thereof is AFFIRMED. Costs against petitioner.

SO ORDERED.

Mendoza, and Quisumbing, JJ., concur.

Austria-Martinez, J., on leave.
Callejo, Sr., J., no part in deliberation.

Page 3 of 100
 FIRST DIVISION it null and void, 9 hence, one incapable of pecuniary estimation falling within the
jurisdiction of the Regional Trial Court. Private respondents did not oppose the motion for
reconsideration.
G.R. No. 119347 March 17, 1999

On February 13, 1995, the respondent judge issued another Order denying the motion for
EULALIA RUSSELL, PUPERTO TAUTHO, FRANCISCO TAUTHO, SUSANA T. REALES,
reconsideration. 10
APITACIO TAUTHO, DANILO TAUTHO, JUDITHA PROS, GREGORIO TAUTHO,
DEODITA T. JUDILLA, AGRIPINO TAUTHO, FELIX TAUTHO, WILLIAM TAUTHO,
AND MARILYN PERALES, petitioners, vs. Hence, this petition wherein the sole issue raised is whether or not the Regional Trial
HONORABLE AUGUSTINE A. VESTlL, ADRIANO TAGALOG, MARCELO TAUTHO, Court has jurisdiction to entertain Civil Case No. MAN-2275.
JUANITA MENDOZA, DOMINGO BANTILAN, RAUL BATALUNA AND ARTEMIO
CABATINGAN, respondent.
We find merit in the petition.

KAPUNAN, J.:
Petitioners maintain the view that the complaint filed before the Regional Trial Court is for
the annulment of a document denominated as "DECLARATION OF HEIRS AND DEED OF
Before us is a Petition for Certiorari to set aside the Order dated January 12, 1995 issued CONFIRMATION OF PREVIOUS ORAL PARTITION," which is clearly one incapable of
by respondent Judge Augustine A. Vestil of the Regional Trial Court of Mandaue City, pecuniary estimation, thus, cognizable by the Regional Trial Court.
Branch 56, dismissing the complaint filed by petitioners on ground of lack of jurisdiction,
as well as his Order dated February 13, 1995 denying petitioners' Motion for
Private respondents, on the other hand, insists that the action is one for re-partition and
Reconsideration of the order of dismissal.
since the assessed value of the property as stated in the complaint is P5,000.00, then,
the case falls within the jurisdiction of the Municipal Circuit Trial Court of Liloan,
The facts of the case are as follows: Compostela, Cebu.

On September 28, 1994, petitioners filed a complaint against private respondents, For better appreciation of the facts, the pertinent portions of the complaint are
denominated "DECLARATION OF NULLITY AND PARTITION," with the Regional Trial Court reproduced hereunder:
of Mandaue City, Branch 56, docketed as Civil Case No. MAN-2275. The complaint, in
substance, alleged that petitioners are co-owners of that parcel of land, Lot 6149 situated
xxx xxx xxx
in Liloan, Cebu and containing an area of 56,977.40 square meters, more or less. The
land was previously owned by the spouses Casimero Tautho and Cesaria Tautho. Upon
the death of said spouses, the property was inherited by their legal heirs, herein 3. That the plaintiffs and the defendants are the legal heirs of spouses Casimero
petitioners and private respondents. Since then, the lot had remained undivided until Tautho and Cesaria N. Tautho who died long time ago;
petitioners discovered a public document denominated "DECLARATION OF HEIRS AND
DEED OF CONFIRMATION OF A PREVIOUS ORAL AGREEMENT OF PARTITION," executed
on June 6, 1990. By virtue of this deed, private respondents divided the property among 4. That in life the spouses became the owners in fee simple of a certain parcel of
themselves to the exclusion of petitioners who are also entitled to the said lot as heirs of land, which is more particularly described as follows:
the late spouses Casimero Tautho and Cesaria Tautho. Petitioners claimed that the
document was false and perjurious as the private respondents were not the only heirs A parcel of land containing 56,97740 square meters, more or less,
and that no oral partition of the property whatsoever had been made between the heirs. located at Cotcot, Liloan, Cebu.
The complaint prayed that the document be declared null and void and an order be issued
to partition the land among all the heirs. 1
designated as Lot 6149 per Technical Description and Certification issued by the
Office of the Land Management copy of which are hereto attached as Annexes
On November 24, 1994, private respondents filed a Motion to Dismiss   the complaint on
2
"A" and "A-1" and are made part hereof: total assessed value is P5,000.00;
the ground of lack of jurisdiction over the nature of the case as the total assessed value
of the subject land is P5,000.00 which under section 33 (3) 3 of Batas Pambansa Blg. 129,
as amended by R.A. No. 7691, 4 falls within the exclusive jurisdiction of the Municipal 5. That the passed to the children of the spouses (who are all deceased except
Circuit Trial Curt of Liloan, Compostela. 5 for defendant Marcelo Tautho), namely: Zacarias, Epifania, Vicenta, Felecisimo,
Maria, Lorencia and Marcelo, and which in turn passed to the plaintiffs and
defendants upon their death they being their descendants and legal heirs;
Petitioners filed an Opposition to the Motion to Dismiss 6 saying that the Regional Trial
Court has jurisdiction over the case since the action is one which is incapable of pecuniary
estimation within the contemplation of Section 19(1) of B.P. 129, as amended. 7 6. That the subject parcel of land has for year been undivided by and among the
legal heirs of said previous owners;

On January 12, 1995, the respondent judge issued an Order granting the Motion to
Dismiss. 8 A Motion for Reconsideration of said order was filed by petitioners on January 7. That, very recently, plaintiffs discovered a public document, which is a
30, 1995 alleging that the same is contrary to law because their action is not one for declaration of heirs and deed of confirmation of a previous oral agreement of
recovery of title to or possession of the land but an action to annul a document or declare partition, affecting the land executed by and among the defendants whereby

Page 4 of 100
 defendants divided the property among themselves to the exclusion of plaintiffs Examples of actions incapable of pecuniary estimation are those for specific performance,
who are entitled thereto; attached hereto as Annex "B" and is made part hereof support, or foreclosure of mortgage or annulment of judgment; 14 also actions questioning
is xerox copy of said document; the validity of a mortgage, 15 annulling a deed of sale or conveyance and to recover the
price paid 16 and for rescession, which is a counterpart of specific performance. 17
8. That the instrument (Annex "B") is false and perjurious and is a complete
nullity because the defendants are not the only heirs of Casimero Tautho; While actions under Sec. 33(3) of B.P. 129 are also incapable of pecuniary estimation, the
plaintiffs are also heirs and descendants of said deceased; moreover, there has law specifically mandates that they are cognizable by the MTC, METC, or MCTC where the
been no oral partition of the property; 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.
9. That pursuant to said document (Annex "B"), defendants had procured tax
19(2). 18 However, the subject matter of the complaint in this case is annulment of a
declarations of the land for their supposed "shares" to the great damage and
document denominated as "DECLARATION OF HEIRS AND DEED OF CONFIRMATION OF
prejudice of plaintiffs;
PREVIOUS ORAL PARTITION."

10. That the property in controversy should be divided into seven (7) equal
The main purpose of petitioners in filing the complaint is to declare null and void the
parts since Casimero Tautho and Cesaria N. Tautho had seven children;
document in which private respondents declared themselves as the only heirs of the late
spouses Casimero Tautho and Cesaria Tautho and divided his property among themselves
11. That the parties had failed to settle the controversy amicably at the to the exclusion of petitioners who also claim to be legal heirs and entitled to the
barangay level; attached hereto as Annex "C" is Certification to file Action; property. While the complaint also prays for the partition of the property, this is just
incidental to the main action, which is the declaration of nullity of the document above-
described. It is axiomatic that jurisdiction over the subject matter of a case is conferred
12. That by reason of the foregoing unjust and illegal act of defendants, by law and is determined by the allegations in the complaint and the character of the
plaintiffs were forced to bring instant action and contract the services of the relief sought, irrespective of whether the plaintiff is entitled to all or some of the claims
undersigned counsel with whom they bind themselves to pay P30,000.00 as asserted therein. 19
attorney's fees.

WHEREFORE, premises considered, the petition is hereby GRANTED. The Order dismissing
WHEREFORE, it is most respectfully prayed of this Honorable Court to declare Civil Case No. MAN-2275, as well as the Order denying the motion for reconsideration of
null and void the document (Annex "B") of declaration of heirs and confirmation said Order, is SET ASIDE.
and to order the partition of the land into seven (7) equal parts; each part shall
respectively go to the seven (7) children of Casimero Tautho and considering six
(6) of them died already the same shall go to their children or descendants, and The Regional Trial Court, Branch 56, Mandaue City is ORDERED to proceed with dispatch
to order the defendants to pay plaintiffs attorney's fees in the amount of in resolving Civil Case No. MAN-2275. No costs.
P30,000.00.
SO ORDERED.
Plaintiffs further pray for such other reliefs and remedies just and equitable
under the premises. 11
Davide, Jr., C.J., Melo and Pardo, JJ., concur.

We agree with petitioners.

The complaint filed before the Regional Trial Court is doubtless one incapable of
pecuniary estimation and therefore within the jurisdiction of said court.

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

[I]n determining whether an action is one the subject matter of which is not
capable of pecuniary estimation this Court has adopted the criterion of first
ascertaining the nature of the principal action or remedy sought. If it is primarily
for the recovery of a sum of money, the claim is considered capable of
pecuniary estimation, and whether jurisdiction is in the municipal courts or in
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 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). 13

Page 5 of 100
 controversy exceeds One hundred thousand pesos (P100,000.00) or, in such other cases
in Metro Manila, where the demand, exclusive of the abovementioned items exceeds Two
FIRST DIVISION hundred thousand pesos (P200,000.00).7

G.R. No. 136109               August 1, 2002

Corollary thereto, Administrative Circular No. 09-94, states:

RADIO COMMUNICATIONS OF THE PHILIPPINES, INC., petitioner, vs. COURT OF

APPEALS and MANUEL DULAWON, respondents. x x x           x x x          x x x

DECISION 2. The exclusion of the term "damages of whatever kind" in determining the jurisdictional
amount under Section 19 (8) and Section 33 (1) of B.P. 129, as amended by R.A. No.
7691, applies to cases where the damages are merely incidental to or a consequence of
YNARES-SANTIAGO, J.: the main cause of action. However, in cases where the claim for damages is the main
cause of action, or one of the causes of action, the amount of such claim shall be
This is a petition for review of the decision of the Court of Appeals 1 in CA-G.R. SP No. considered in determining the jurisdiction of the court.
45987 dated April 30, 1998 2 and its resolution dated October 15, 1998 3 denying the
motion for reconsideration. x x x           x x x          x x x

On June 18, 1997, private respondent Manuel Dulawon filed with the Regional Trial Court In Russell, et al., v. Vestil, et al.,8 the Court held that in determining whether an action is
of Tabuk, Kalinga, Branch 25, a complaint for breach of contract of lease with damages one the subject matter of which is not capable of pecuniary estimation, the nature of the
against petitioner Radio Communications of the Philippines, Inc. (RCPI). Petitioner filed a principal action or remedy sought must first be ascertained. If it is primarily for the
motion to dismiss the complaint for lack of jurisdiction contending that it is the Municipal recovery of a sum of money, the claim is considered capable of pecuniary estimation, and
Trial Court which has jurisdiction as the complaint is basically one for collection of unpaid jurisdiction over the action will depend on the amount of the claim. However, where the
rentals in the sum of P84,000.00, which does not exceed the jurisdictional amount of basic issue is something other than the right to recover a sum of money, where the
P100,000.00 for Regional Trial Courts. The trial court denied the motion to dismiss, 4 as money claim is purely incidental to, or a consequence of, the principal relief sought, the
well as petitioner’s motion for reconsideration. 5 Hence, petitioner went to the Court of action is one where the subject of the litigation may not be estimated in terms of money,
Appeals on a petition for certiorari. On April 30, 1998, the Court of Appeals dismissed the which is cognizable exclusively by Regional Trial Courts.
petition. The dispositive portion thereof reads:

It is axiomatic that jurisdiction over the subject matter of a case is conferred by law and
WHEREFORE, the petition is hereby DENIED DUE COURSE and is DISMISSED. Costs is determined by the allegations in the complaint and the character of the relief sought,
against petitioner. irrespective of whether the plaintiff is entitled to all or some of the claims asserted
therein.9
SO ORDERED.6
In the case at bar, the allegations in the complaint plainly show that private respondent’s
The motion for reconsideration of the foregoing decision was denied on October 15, 1998. cause of action is breach of contract. The pertinent portion of the complaint recites:
Hence, this petition.
x x x           x x x          x x x
The issue for resolution in this petition is whether or not the Regional Trial Court has
jurisdiction over the complaint filed by private respondent. 2. That sometime during the end of the year 1995, defendant through its
appropriate officials negotiated with plaintiff the lease of a portion of the latter’s
Pertinent portion of Batas Pambansa Blg. 129, as amended by Republic Act No. 7691, building x x x
provides:
3. That the lease contract was effective for a period of three (3) years of from
SEC. 19. Jurisdiction in civil cases. – Regional Trial Courts shall exercise exclusive original January 1, 1996 to January 1, 1998 with advance payment for the year 1996.
jurisdiction: The advance was not however given in lump sum but on installment. One check
that was given in payment of one month’s rental for 1996 was even stale and
had to be changed only after demand;
(1) In all civil actions in which the subject of the litigation is incapable of pecuniary
estimation;
4. That as per contract the monthly rental for 1997 was P3,300.00 while for
1998, it is P3,700.00;
x x x           x x x          x x x

5. That the defendant surreptitiously removed its equipments and other

(8) In all other cases in which the demand, exclusive of interest, damages of whatever personalities from the leased premises and failed to pay rentals due for the
kind, attorney’s fees, litigation expenses, and costs or the value of the property in

Page 6 of 100
 months of January to March 1997 to the damage and prejudice of plaintiff; that "Subject matter over which jurisdiction can not be conferred by consent, has reference,
this failure and refusal on the part of plaintiff accelerated the payment of all not to the res or property involved in the litigation nor to a particular case, but to the
rentals for each month for the years 1997 and 1998; class of cases, the purported subject of litigation, the nature of the action and of the relief
sought (Appeal of Maclain, 176 NW. 817)."
6. That the acts of defendant amounts to a breach of contract which is unlawful
and malicious, as in fact, it caused plaintiff serious anxiety, emotional stress, Specifically, it has been held that:
and sleepless nights for which he is entitled to moral damages;
"The Court has no jurisdiction of a suit for specific performance of a contract, although
7. That plaintiff conveyed his feelings to Mr. Ronald C. Manalastas as evidenced the damages alleged for its breach, if permitted, are within the amount of which that
by a letter dated January 7, 1997 a copy of which is hereto attached to form court has jurisdiction." (Mebane Cotton Breeding Station. vs. Sides, 257 SW. 302; 21
part hereof as Annex "B". This was later followed by a letter of plaintiff’s counsel C.J.S. 59, note).
a machine copy of which is hereto attached to form part hereof and marked as
Annex "C". Both these letters landed on deaf ears thereby aggravating the
x x x           x x x          x x x
worries/anxieties of plaintiff;

Clearly, the action for specific performance case, irrespective of the amount of rentals and
8. That the period agreed is for the benefit of both parties and any unilateral
damages sought to be recovered, is incapable of pecuniary estimation, hence cognizable
termination constitutes breach of contract;
exclusively by the Regional Trial Court. The trial court, therefore, did not err in denying
petitioner’s motion to dismiss.
9. That defendant actually used the leased premises during the year 1996; that
had it not been for the contract, plaintiff could have leased the premises to
WHEREFORE, in view of all the foregoing, the petition is DENIED and the assailed
other persons for business purposes; that this unlawful and malicious breach of
decision of the Court of Appeals in CA-G.R. SP No. 45987 is AFFIRMED.
contract cannot be lawfully countenanced hence defendant must be taught a
lesson by being ordered to pay exemplary damages;
SO ORDERED.
x x x x x x x x x.10
Davide, Jr., C.J., (Chairman), Vitug, Kapunan, and Austria-Martinez, JJ., concur.
It is settled that a breach of contract is a cause of action either for specific performance
or rescission of contracts.11 In Manufacturer’s Distributors, Inc. v. Siu Liong,12 the Court
held that actions for specific performance are incapable of pecuniary estimation and
therefore fall under the jurisdiction of the Regional Trial Court. 13 Here, the averments in
the complaint reveal that the suit filed by private respondent was primarily one for
specific performance as it was aimed to enforce their three-year lease contract which
would incidentally entitle him to monetary awards if the court should find that the subject
contract of lease was breached. As alleged therein, petitioner’s failure to pay rentals due
for the period from January to March 1997, constituted a violation of their contract which
had the effect of accelerating the payment of monthly rentals for the years 1997 and
1998. The same complaint likewise implied a premature and unilateral termination of the
term of the lease with the closure of and removal all communication equipment in the
leased premises.14 Under the circumstances, the court has to scrutinize the facts and the
applicable laws in order to determine whether there was indeed a violation of their lease
agreement that would justify the award of rentals and damages. The prayer, therefore,
for the payment of unpaid rentals in the amount of P84,000.00 plus damages consequent
to the breach is merely incidental to the main action for specific performance. Similarly,
in Manufacturer’s Distributor’s Inc.,15 the Court explained –

x x x           x x x          x x x

That plaintiff’s complaint also sought the payment by the defendant of P3,376.00, plus
interest and attorney’s fees, does not give a pecuniary estimation to the litigation, for the
payment of such amounts can only be ordered as a consequence of the specific
performance primarily sought. In other words, such payment would be but an incident or
consequence of defendant's liability for specific performance. If no such liability is
judicially declared, the payment can not be awarded. Hence, the amounts sought do not
represent the value of the subject of litigation.

Page 7 of 100
 SECOND DIVISION Unit AB-122 of said condominium, made an unauthorized installation of glasses at the
balcony of his unit in violation of Article IV, Section 3 paragraph (d) of the Master Deed
[G.R. No. 97805. September 2, 1992.] and Declaration of Restrictions of the Association, which states that:

NILO H. RAYMUNDO, Petitioner, v. HON. COURT OF APPEALS, Sixteenth Division, "d. Nothing shall be done or placed in any unit or in the common areas which is beyond or
Hon. Judge, RTC, Br. 133, Makati, Metro Manila and GALLERIA DE MAGALLANES will impair the structural strength of the buildings or alter the original architecture,
ASSOCIATION, INC., Respondents. appearance and specifications of the building, including the external facade thereof." 5

Thereafter, the administrator of said condominium reported said violation to the Board of
SYLLABUS Directors of the private respondent Galleria de Magallanes Association, Inc. in a special
meeting held on July 8, 1989 and the former sent a letter dated July 12, 1989 6 to the
1. REMEDIAL LAW; REGIONAL TRIAL COURT; JURISDICTION IN CIVIL CASES petitioner demanding the latter to remove the illegal and unauthorized installation of
NOT CAPABLE OF PECUNIARY ESTIMATION. — Private respondent’s complaint is an glasses at his unit.
action to compel the petitioner to remove the illegal and unauthorized installation of
glasses at Unit AB-122 of the condominium which is not capable of pecuniary estimation Petitioner refused, consequently, private respondent filed a complaint for mandatory
and falls under the exclusive jurisdiction of the Regional Trial Court Section 33 of Batas injunction against petitioner on February 21, 1990 with the Regional Trial Court of Makati,
Pambansa Bilang 129 is not applicable in the instant case, but paragraph (1), Section 19 Branch 133 in Civil Case No. 90-490.
and paragraph (1), Section 21.
On March 12, 1990, petitioner filed a Motion for extension of time to file an Answer 7 as
2. ID; ID.; ID.; CRITERION IN DETERMINING WHETHER AN ACTION IS ONE THE well as a Motion for production of document 8 which were granted in an Order dated
SUBJECT MATTER OF WHICH IS NOT CAPABLE OF PECUNIARY ESTIMATION. — A March 16, 1990. 9
civil action in which the subject of the litigation is incapable of pecuniary estimation has
invariably been held to be within the exclusive original jurisdiction of the Regional Trial However, on March 23, 1990, instead of an Answer, petitioner filed a Motion to Dismiss
Courts. "In determining whether an action is one the subject matter of which is not with the trial court on the ground that said court has no jurisdiction over the present case
capable of pecuniary estimation this Court has adopted the criterion of first ascertaining since a complaint for mandatory injunction is within the exclusive original jurisdiction of
the nature of the principal action or remedy sought. If it is primarily for the recovery of a the Metropolitan Trial Court.
sum of money, the claim is considered capable of pecuniary estimation, and whether
jurisdiction is in the municipal courts [now municipal trial courts] or in the courts of first The Motion to Dismiss was denied in the Order of June 1, 1990, the pertinent portion of
instance [now regional trial courts] would depend on the amount of the claim. However, which reads:
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 "This is a suit for mandatory injunction. Under Sec. 21 of BP 129, as amended, it is the
sought, this Court has considered such actions as cases where the subject of the litigation Regional Trial Court which has the legal competence to issue the same. Corollarily, the
may not be estimated in terms of money, and are cognizable exclusively by courts of first second ground must be denied. The action is essentially one which falls within the
instance [now regional trial courts]." jurisdiction of the Regional Trial Court.

3. ID.; PROVISIONAL REMEDIES; WRIT OF MANDATORY INJUNCTION; WHEN "WHEREFORE, the Motion to Dismiss is hereby denied, for lack of merit." 10
AVAILABLE. — A writ for mandatory injunction is a provisional remedy. It is provisional
because it constitutes a temporary measure availed of during the pendency of the main Likewise, petitioner’s Motion for Reconsideration was denied in the Order of June 29, 1990
action and it is ancillary because it is a mere incident in and is dependent upon the result which We quote, to wit:
of the main action.
"As denominated in the complaint itself, this is a suit for mandatory injunction, and the
nature of the action as designated by the plaintiff is substantiated by the allegations of
DECISION the complaint itself. Such being the case, Sec. 21 of BP 129 governs. The claims for
attorney’s fees is incidental to the nature of the complaint as one of mandatory injunction
which is also attested by the prayer in the complaint "to remove the illegal and
NOCON, J.: unauthorized installation of glasses at Unit AB-122 of the Condominium within five (5)
days from receipt of the order . . ." and, therefore, does not affect the legal competence
of the Court to act on the complaint." 11
This is a petition for certiorari and prohibition with restraining order and preliminary
injunction to annul and set aside the decision of the Court of Appeals dated March 11, On elevation to the appellate court in a petition for certiorari and prohibition with
1991 1 dismissing petitioner’s petition for certiorari and prohibition which assailed the restraining order and preliminary injunction, the petition was again dismissed on March
Orders 2 dated June 1, 1990 3 and June 29, 1990 4 of the trial court. 11, 1991.

It appears on record that on July 5, 1989, the administrator of the Galleria de Magallanes Hence, this petition alleging want of jurisdiction of the trial court to hear and decide
Condominium discovered that petitioner Nilo Raymundo, who was an owner/occupant of private respondent’s complaint for mandatory injunction considering that private

Page 8 of 100
respondent’s sole pecuniary claim of P10,000.00 as attorney’s fees in Civil Case No. 90- Note should be taken. however, that the trial court had erroneously considered the
490 is within the original and exclusive jurisdiction of the Metropolitan Trial Court as complaint as one for mandatory injunction, misled perhaps by the caption of the
provided for under Section 33 of B.P. 129. complaint.

We do not agree. A writ for mandatory injunction is a provisional remedy. It is provisional because it
constitutes a temporary measure availed of during the pendency of the main action and it
The contention of the petitioner is devoid of merit because private respondent’s complaint is ancillary because it is a mere incident in and is dependent upon the result of the main
is an action to compel the petitioner to remove the illegal and unauthorized installation of action. 13
glasses at Unit AB-122 of the condominium which is not capable of pecuniary estimation
and falls under the exclusive jurisdiction of the Regional Trial Court Section 33 of Batas WHEREFORE, the petition for certiorari and prohibition with restraining order and
Pambansa Bilang 129 is not applicable in the instant case, but paragraph (1), Section 19 preliminary injunction is hereby DISMISSED for lack of merit and the decision of the Court
and paragraph (1), Section 21 of said law which provide: of Appeals promulgated on March 11, 1991 is hereby AFFIRMED.

"Sec. 19. Jurisdiction in civil cases. — Regional Trial Courts shall exercise exclusive SO ORDERED.
original jurisdiction:
Narvasa, C.J., Padilla, Regalado and Melo, JJ., concur.
(1) In all civil actions in which the subject of the litigation is incapable of pecuniary
estimation;"
x x x

"Sec. 21. Original jurisdiction in other cases. — Regional Trial Courts shall exercise
original jurisdiction:

(1) In the issuance of writs of certiorari, prohibition, mandamus, quo warranto, habeas
corpus and injunction which may be enforced in any part of their respective regions;"

A civil action in which the subject of the litigation is incapable of pecuniary estimation has
invariably been held to be within the exclusive original jurisdiction of the Regional Trial
Courts.

"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 [now municipal trial courts] or in the courts of first instance
[now regional trial courts] 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, 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]." 12

As correctly stated by the Court of Appeals, the question for resolution is whether or not
the petitioner violated the provisions of the Master Deed and Declaration of Restriction of
the corporation, and if so, to remove the illegal and unauthorized installation of glasses at
Unit AB-122 of the Condominium. Clearly, the issue is incapable of pecuniary estimation.

In the instant case. the claim of attorney’s fees by the private respondent in the amount
of P10,000.00 is only incidental to its principal cause of action which is for the removal of
the illegal and unauthorized installation of the glasses made by the petitioner and
therefore, said amount is not determinative of the jurisdiction of the court.

Page 9 of 100
 THIRD DIVISION Upon the instance of petitioner Concepcion Roque and allegedly of respondent Ernesto
Roque, Lot No. 1549 was surveyed on 20 September 1975. Consequent thereto, a
Subdivision Plan 5 was drawn up by the Geodetic Engineer Identifying and delineating a
G.R. No. 75886 August 30, 1988
one-fourth (1/4) portion (78 square meters) of the property as belonging to respondent
Ernesto Roque and Victor Roque (who had died on 14 April 1962), upon the one hand,
CONCEPCION ROQUE, petitioner, vs. and a three-fourths (3/4) portion (234 square meters) of the same property as belonging
HON. INTERMEDIATE APPELLATE COURT, ERNESTO ROQUE, FILOMENA to petitioner Concepion Roque, upon the other hand. Petitioner claimed that preparation
OSMUNDO, CECILIA ROQUE, MARCELA ROQUE, JOSE ROQUE and RUBEN of the Subdivision Plan, which was approved on 3 November 1975 by the Land
ROQUE, respondents. Registration Commission was a preliminary step leading eventually to partition of Lot No.
1549, partition allegedly having been previously agreed upon  inter se by the co-owners.
Respondents Ernesto Roque and the legal heirs of Victor Roque, however, refused to
Lorenzo J. Liwag for petitioner. acknowledge petitioner's claim of ownership of any portion of Lot No. 1549 and rejected
Dominador Ad Castillo for private respondents. the plan to divide the land.

FELICIANO, J.: Attempts at amicable settlement having fallen through, petitioner Concepcion Roque, on 6
December 1977, filed a Complaint for "Partition with Specific Performance" 6 (docketed as
The subject of the present Petition for Review is the 31 July 1986 Decision of the former Civil Case No. 5236-M) with Branch 2 of the then Court of First Instance of Malolos
Intermediate Appellate Court in AC-G.R. CV No. 02248 (entitled, "Concepcion Roque, against respondents Emesto Roque and the heirs of Victor Roque. In her complaint,
plaintiff-appellee, vs. Ernesto Roque, Filomena Osmunda Cecilia Roque, Marcela Roque, petitioner (plaintiff below) claimed legal ownership of an undivided threefourths (3/4)
Jose Roque and Ruben Roque, defendants-appellants") which reversed and set aside on portion of Lot No. 1549, by virtue of the 27 November 1961 "Bilihan Lubos at Patuluyan"
appeal the decision of the Regional Trial Court of Malolos, Branch 9. executed in her favor by Emesto Roque and Victor Roque. In support of this claim,
petitioner also presented an undated and unnotarized "Kasulatang Pagkilala sa Bilihan
Patuluyan ng Bahagui at Pagmamana sa Labas ng Hukuman at Paghahati-hati at Abuyan
The controversy here involves a 312 square meter parcel of land situated in San Juan, ng Bahagui" 7 said to have been signed by the respondents in acknowledgment of the
Malolos, Bulacan and designated as Lot No. 1549 of the Cadastral Survey of Malolos. The existence and validity of the Bilihan in favor of petitioner. Finally, petitioner alleged that,
property was registered originally in the name of Januario Avendaño, a bachelor who died as a coowner of Lot No. 1549, she had a right to seek partition of the property, that she
intestate and without issue on 22 October 1945. could not be compelled to remain in the coownership of the same.

On 21 September 1959, the intestate heirs of Januario Avendafio executed a document In an Answer with Compulsory Counterclaim 8 filed on 28 December 1977, respondents
entitled "Paghahati at Pagtagabuyan ng Mana sa Labas ng Hukuman." 1 Through this (defendants below) impugned the genuineness and due execution of the "Bilihan Lubos at
instrument, extrajudicial partition of Lot No. 1549 was effected among the intestate heirs Patuluyan" dated 27 November 1961 on the ground "that the signatures appearing
as follows: thereon are not the authentic signatures of the supposed signatories ...." It was also
alleged that petitioner Concepcion Roque, far from being a co-owner of Lot No. 1549,
a. One-fourth (1/4) undivided portion to Illuminada Avendaño. "occupied a portion of the lot in question by mere tolerance of the [defendants]."
Respondents also refused to honor the unnotarized Kasulatan and, additionally, denied
having had any participation in the preparation of the Subchvision Plan.
b. One-fourth (1/4) undivided portion to Gregorio Avendafio and Miguel
Avendaño.
On 27 June 1983, the trial court (now Branch 9, Regional Trial Court of Malolos) rendered
a Decision, 9 the dispositive portion of which read:
c. One-fourth (1/4) undivided portion to Bernardino, Bienvenido, Numeriano and
Rufina, all surnamed Avendaño.
WHEREFORE, judgment is hereby rendered, in favor of the plaintiff and against
the defendants;
d. One-fourth (1/4) undivided portion to respondent Emesto Roque and Victor
Roque. 2
1. Ordering the heirs of the late Victor Roque namely Filomena Osmunda his
spouse, his children, Cecilia Roque, Marcela Roque, Jose Roque and Ruben
On 28 September 1959, co-owners Illuminada, Gregorio, Miguel, Bernardino, Bienvenido, Roque and their uncle and co-defendant Emesto Roque, to execute a deed of
Numeriano and Rufina, all surnamed Avendaño, in consideration of the aggregate amount confirmation of the sale made by Emesto and Victor Roque in favor of plaintiff
of P500.00, transferred their collective and undivided threefourths (3/4) share in Lot No. Concepcion Roque, entitled "Bilihan Lubos at Patuluyan," executed on November
1549 to respondent Ernesto Roque and Victor Roque, thereby vesting in the latter full and 27, 1961, Exh. E, over the 3/4 portion of the subject property;
complete ownership of the property. The transactions were embodied in two (2) separate
deeds of sale both entitled "Kasulatan ng Bilihang Patuluyan" 3 and both duly notarized.
Subsequently, in an unnotarized "Bilihan Lubos at Patuluyan" 4 dated 27 November 1961, 2. Ordering the partition of the parcel of land described in par. 3 of tie complaint
Emesto and Victor Roque purportedly sold a three-fourths (3/4) undivided portion of Lot covered by Original Certificate of Title No. 1442 Bulacan issued in the name of
No. 1549 to their half-sister, petitioner Concepcion Roque, for the same amount. The Januario Avendafio, in the proportion of 3/4 to pertain to Concepcion Roque,
property, however, remained registered in the name of the decedent, Januario Avendaño. and 1/4 to pertain to Emesto Roque and his co- defendants, his sister-in-law,
nephews and nieces, in accordance with the approved subdivision plan (LRC
Psd-230726).

Page 10 of 100
 3. Ordering defendants,jointly and severally, to pay to plaintiff the sum of brought by an aggrieved co-owner is accion reivindicatoria or action for recovery
P2,000.00 as and for attomey's fees and the costs of suit. of title and possession (Jardin vs. Hallasgo, 11 7 SCRA 532, 536, 537; Paner vs.
Gaspar, 3 CA Rep. 155, 158). (Emphasis supplied)
SO ORDERED.
Viewed in the light of the facts of the present case, the Intermediate Appellate Court's
decision appears to imply that from the moment respondents (defendants below) alleged
The respondents appealed from this decision alleging the following errors:
absolute and exclusive ownership of the whole of Lot No. 1549 in their Answer, the trial
court should have immediately ordered the dismissal of the action for partition and
I petitioner (plaintiff below), if she so desired, should have refiled the case but this time as
an accion reinvindicatoria. Taking this analysis a step further should the reivindicatory
action prosper — i.e., a co-ownership relation is found to have existed between the
The lower court erred when it decided and ordered defendantsappellants to parties — a second action for partition would still have to be instituted in order to effect
execute a confirmation of the "Bilihan Lubos at Patuluyan," Exh. "E." division of the property among the co-owners.

II We do not agree with the above view. An action for partition-which is typically brought by
a person claiming to be co-owner of a specified property against a defendant or
The lower court erred when it decided and ordered the defendantsappellant,s to defendants whom the plaintiff recognizes to be co-owners — may be seen to present
deliver unto the plaintiff [a] 3/4 share of the land in question. simultaneously two principal issues. First, there is the issue of whether the plaintiff is
indeed a co-owner of the property sought to be partitioned. Second, assuming that the
plaintiff successfully hurdles the first issue, there is the secondary issue of how the
III property is to be divided between plaintiff and defendant(s) — i.e., what portion should
go to which co-owner.
The lower court erred in deciding this case in favor of the plaintiff-appellee,
based on an unnotarized and forged signature of defendantappellant Ernesto Should the trial court find that the defendants do not dispute the status of the plaintiff as
Roque. co-owner, the court can forthwith proceed to the actual partitioning of the property
involved. In case the defendants assert in their Answer exclusive title in themselves
IV adversely to the plaintiff, the court should not dismiss the plaintiffs action for partition
but, on the contrary and in the exercise of its general jurisdiction, resolve the question of
whether the plaintiff is co-owner or not. Should the trial court find that the plaintiff was
The lower court erred in giving credence to the testimony of the plaintiff- unable to sustain his claimed status as co-owner, or that the defendants are or have
appellee Concepcion Roque despite [its] gross inconsistencies. 10 become the sole and exclusive owners of the property involved, the court will necessarily
have to dismiss the action for partition. This result would be reached, not because the
Acting on the appeal (docketed as A.C.-G.R. CV No. 02248), the Intermediate Appellate wrong action was commenced by the plaintiff, but rather because the plaintiff having
Court, in a Decision 11 dated 31 July 1986, reversed the judgment of the trial court and been unable to show co-ownership rights in himself, no basis exists for requiring the
dismissed both the petitioner's complaint and the respondents' appeal. A Motion for defendants to submit to partition the property at stake. If, upon the other hand, the court
Reconsideration of petitioner Concepcion Roque was denied. after trial should find the eidstence of co-ownership among the parties litigant, the court
may and should order the partition of the property in the same action. Judgment for one
or the other party being on the merits, the losing party (respondents in this case) may
The present Petition for Review was filed with this Court on 18 September 1986. In a then appeal the same. In either case, however, it is quite unnecessary to require the
resolution dated 27 July 1987, we gave due course to the Petition and required the plaintiff to file another action, separate and independent from that for partition originally
parties to submit their respective Memoranda. instituted. Functionally, an action for partition may be seen to be at once an action for
declaration of coownership and for segregation and conveyance of a determinate portion
1. On the matter of dismissal of petitioner's complaint, the Intermediate Appellate Court of the property involved. This is the import of our jurisprudence on the matter. 12 and is
stated in its decision: sustained by the public policy which abhors multiplicity of actions.

While the action filed by the plaintiff is for partition, the defendantz, after The question of prescription also needs to be addressed in this connection. It is
denying plaintiff's assertion of co-ownership, asserted that they are the sometimes said that "the action for partition of the thing owned in common (actio
exclusive and sole owners of the 314 portion of the parcel of land claimed by the communi dividendo or actio familiae erciscundae) does not prescribe." 13 This statement
plaintiff. bears some refinement. In the words of Article 494 of the Civil Code, "each co-owner may
demand at any time the partition of the thing owned in common, insofar as his share is
concemed." No matter how long the co-ownership has lasted, a co-owner can always opt
Upon the issue thusjoined by the pleadings, it is obvious that the case has out of the co-ownership, and provided the defendant co-owners or co-heirs have
become one ofownership of the disputed portion of the subject lot. theretofore expressly or impliedly recognized the co-ownership, they cannot set up as a
defense the prescription of the action for partition. But if the defendants show that they
had previously asserted title in themselves adversely to the plaintiff and for the requisite
It is well settled that an action for partition will not prosper as such from the
period of time, the plaintiffs right to require recognition of his status as a co-owner will
moment an alleged co-owner asserts an adverse title. The action that may be
have been lost by prescription and the court cannot issue an order requiring partition.

Page 11 of 100
This is precisely what happened in Jardin v. Hallasgo, 117 SCRA 532 (1982), which the action for partition initially available to the heirs of Catalino and Galo had, as a result of
respondent appellate court cited to support its position quoted above. the preceding circumstance, already prescribed.

The case of Jardin involved, among others, two (2) parcels of land which were inherited in An entirely different situation, however, obtains in the case at bar. First of all, petitioner
1920 by the brothers Catalino jardin and Galo Jardin together with their half-brother, Concepcion Roque-the co-owner seeking partition — has been and is presently in open
Sixto Hallasgo. The three (3) held these lands in co-ownership until Sixto later (the date and continuous possession of a three-fourths (3/4) portion of the property owned in
was not specified) repudiated the coownership and occupied and possessed both parcels common. The Court notes in this respect the finding of the trial court that petitioner,
of land, claiming the same exclusively as his own. Sometime in 1973, the heirs of following execution of the "Bilihan Lubos at Pattlluyan" on 27 November 1961, had been
Catalino and Galo instituted an action for partition of the two (2) properties against in "continuous occupancy of the 3/4 portion of the lot ... up to the present, and whereon
Sixto's heirs, who had refused to surrender any portion of the same to the former. The plaintifrs house and that of her son are erected. " 14 Respondents do not dispute this
trial court, assuming that prescription had started to run in that case even before the Civil finding of fact, although they would claim that petitioner's possession is merely tolerated
Code took effect, held that the action for partition filed by the heirs of Catalino and Galo by them. Second, prior to filing in 1977 of the Complaint in Civil Case No. 5236-
had already prescribed. On appeal, this Court affirmed the trial court on this point in the M,  neither of the parties involved had asserted or manifested a claim of absolute and
following terms: exclusive ownership over the whole of Lot No. 1549 adverse to that of any of the other
co-owners: in other words, co-ownership of the property had continued to be recognized
by all the owners.  Consequently, the action for partition could not have and, as a matter
Article 494 of the Civil Code provides that "no co-owner shall be obliged to
of fact, had not yet prescribed at the time of institution by Concepcion of the action
remain in the co- ownership" and that "each co-owner may demand at any time
below.
the partition of the thing owned in common, insofar as his share is concerned."
It also provides that 'no prescription shall run in favor of a co-owner or co-heir
against his co-owners or co-heirs so long as he expressly or impliedly recognizes 2. Coming now to the matter regarding dismissal of the respondents'appeal, the
the co-ownership. Intermediate Appellate Court held that inasmuch as the attack on the validity of the
"Bilihan Lubos at Patuluyan" was predicated on fraud and no action for annulment of the
document had been brought by respondents within the four (4) year prescriptive period
While the action for the partition of the thing owned in common ( actio communi
provided under Article 1391 of the Civil Code, such action had already prescribed.
dividendo or actio familiae erciscundae) does not prescribe, the co-ownership
does not last forever since it may be repudiated by a co-owner [i.e., Sixto]. In
such a case, the action for partition does not lie. What may be brought by the We find it unnecessary to deal here with the issue of prescription discussed by the
aggrieved co-owner [i.e., the heirs of Catalino and Galo] is an accion respondent court in its assailed decision. The facts on record clearly show that petitioner
reivindicatoria or action for recovery of title and possession. That action may be Concepcion Roque had been in actual, open and continuous possession of a three-fourths
barred by prescription. (3/4) portion of Lot No. 1549 ever since execution of the "Bilihan Lubos at Patuluyan" in
November of 1961. The Court notes that it was only in their Answer with Compulsory
Counterclaim filed with the trial court in December of 1977 — more than sixteen (16)
If the co-heir or co-owner having possession of the hereditary or community
years later — that respondents first questioned the genuineness and authenticity of the
property, holds the same in his own name, that is, under claim of exclusive
"Bilihan Lubos at Patuluyan." Not once during those sixteen (16) years did respondents
ownership, he may acquire the property by prescription if his possession meets
contest petitioner's occupation of a three-fourths (3/4) portion of Lot No. 1549.
all the other requirements of the law, and after the expiration of the prescriptive
Furthermore, if indeed it is true that respondents, as they claim, are the absolute owners
period, his co-heir or co-owner may lose their right to demand partition, and
of the whole of Lot No. 1549, it is most unusual that respondents would have allowed or
their action may then be held to have prescribed (De los Santos vs. Santa
tolerated such prolonged occupation by petitioner of a major portion (3/4) of the land
Teresa, 44 Phil. 811).
while they, upon the other hand, contented themselves with occupation of only a fourth
thereof. This latter circumstance, coupled with the passage of a very substantial length of
xxx xxx xxx time during which petitioner all the while remained undisturbed and uninterrupted in her
occupation and possession, places respondents here in laches: respondents may no
longer dispute the existence of the co-ownership between petitioner and themselves nor
(Emphasis supplied) the validity of petitioner's claim of a threefourths (3/4) interest in Lot No. 1549, as they
are deemed, by their unreasonably long inaction, to have acquiesced in the
In the light of the foregoing discussion, it will be seen that the underscored portion of the coow,aership. 15 In this respect, we affirm the decision of the respondent appellate court
Court's opinion in Jardin  is actually obiter. For there, the Court simply held the action for presently under review.
partition by the heirs of Catalino and Galo had prescribed and did not require such heirs
to start a new action (which would have been quite pointless); on the other hand, the WHEREFORE, the Decision of the Intermediate Appellate Court dated 31 July 1986 in
Court remanded the case to the lower court for further proceedings in respect of the A.C.-G.R. CV No. 02248 is SET ASIDE with respect to that portion which orders the
recovery of a 350 square meter lot which the evidence showed was owned by the dismissal of the Complaint in Civil Case No. 5236-M, but is AFFIRMED with respect to that
plaintiffs but wrongfully included by Sixto in the cadastral survey of his share of the portion which orders the dismissal of the respondents'appeal in A.C.-G.R. CV No. 02248.
adjoining lot. The Decision of Branch 9 of the Regional Trial Court of Malolos dated 27 June 1983 in Civil
Case No. 5236-M is hereby REINSTATED. No pronouncement as to costs.
In  Jardin, the claim of co-ownership asserted by the heirs of Catalino and Galo was
effectively refuted by the heirs of Sixto, who not only claimed for themselves absolute SO ORDERED.
and exclusive ownership of the disputed properties but were also in actual and adverse
possesion thereof for a substantial length of time. The Court found, further, that the

Page 12 of 100
Fernan, C.J., Gutierrez, Jr. and Cortes, JJ., concur. rendered the assailed decision denying due course and dismissing the petition for
Bidin, J., took no part. certiorari.6 Petitioner’s motion for reconsideration was denied in the Resolution dated April
21, 1997.7

The case is now before us on petition for review, based on the following issues:
FIRST DIVISION
I
G.R. No. 129017            August 20, 2002
THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT
PRIVATE RESPONDENTS NEED NOT BE ACKNOWLEDGED AS HEIRS OF THE
CONCEPCION V. VDA, DE DAFFON, petitioner, vs.
DECEASED AMADO DAFFON.
THE HONORABLE COURT OF APPEALS, LOURDES OSMEÑA VDA, DE DAFFON,
AILEEN DAFFON, JOSELITO DAFFON, JR., ANA VANESA DAFFON, LEILA DAFFON
and SUZETTE DAFFON, respondents. II

YNARES-SANTIAGO, J.: THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT IT

IS NOT NECESSARY THAT PRIVATE RESPONDENTS BE THE REGISTERED
OWNERS OF THE PROPERTIES CLAIMED IN THE ACTION FOR PARTITION.
Petitioner Concepcion Villamor was married to the late Amado Daffon, with whom she
begot one son, Joselito Daffon. Joselito married Lourdes Osmeña, and they bore six
children, namely, Aileen, Joselito Jr., Ana Vanesa, Leila, Julius and Suzette. III

Amado passed away on January 21, 1982. His son, Joselito, died on October 25, 1990. THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT THE
TRIAL COURT IS NOT REQUIRED TO TAKE JUDICIAL NOTICE OF ANOTHER CASE
PENDING IN ANOTHER COURT.
On January 21, 1994, respondents Lourdes Osmeña Vda. De Daffon, together with her six
minor children, instituted an action for partition against petitioner Concepcion Villamor
Vda. De Daffon, which case was docketed as Civil Case No. DNA-281 of the Regional Trial IV
Court of Danao City, Branch 25.1 Respondents alleged that Amado left several real and
personal properties which formed part of his conjugal partnership with petitioner. Joselito
THE RESPONDENT COURT OF APPEALS GRAVELY ERRED IN NOT HOLDING THAT
being a forced heir of Amado was entitled to at least one half of Amado’s estate,
THE TRIAL COURT’S DENIAL OF PETITIONER’S MOTION TO DISMISS THE
consisting of his share in the said conjugal properties. However, the said properties were
COMPLAINT BASED ON FAILURE TO STATE A CAUSE OF ACTION IS
never partitioned between petitioner and Joselito. After Joselito’s death, petitioner’s
REVIEWABLE BY THE SPECIAL CIVIL ACTION OF CERTIORARI.8
behavior towards respondents, her daughter-in-law and grandchildren, changed. She
claimed absolute ownership over all the properties and deprived them of the fruits
thereof. Thus, respondents prayed that the conjugal properties of Amado Daffon and There is no merit in the petition.
petitioner be partitioned and that the one-half share of Amado be further partitioned
between petitioner, on one hand, and the respondents as heirs of Joselito Daffon, on the
other hand. It should be stressed that in the determination of whether a complaint fails to state a
cause of action, only the statements in the complaint may be properly
considered.9 Moreover, a defendant who moves to dismiss the complaint on the ground of
Petitioner filed a Motion to Dismiss on the grounds of (1) lack of jurisdiction over the lack of cause of action hypothetically admits all the averments thereof. The test of
subject matter of the case; (2) failure of the complaint to state a cause of action; and (3) sufficiency of the facts found in a complaint as constituting a cause of action is whether or
waiver, abandonment and extinguishment of the obligation. 2 She argued that the trial not admitting the facts alleged the court can render a valid judgment upon the same in
court cannot take cognizance of the action for partition considering her claim of absolute accordance with the prayer thereof. The hypothetical admission extends to the relevant
ownership over the properties; and that respondents themselves admitted that petitioner and material facts well pleaded in the complaint and inferences fairly deducible therefrom.
has repudiated the co-ownership. Anent the third ground, petitioner alleged that Joselito Hence, if the allegations in the complaint furnish sufficient basis by which the complaint
Daffon filed a complaint against Milagros Marin, who was likewise married to Amado can be maintained, the same should not be dismissed regardless of the defense that may
Daffon, for recovery of a parcel of land in Mandaluyong. 3 In said complaint, respondent be assessed by the defendants.10
Lourdes Osmeña Vda. De Daffon allegedly admitted that the land sought was the only
property of the late Amado Daffon.
In the case at bar, the complaint sufficiently alleged that “defendant (i.e., petitioner
herein) was married to Amado Quiros Daffon” and that “they begot an only son in Joselito
In an Order dated July 22, 1994, the trial court denied the Motion to Dismiss. 4 Petitioner Daffon.”11 The complaint further alleged that “Joselito Daffon later got married to herein
filed a motion for reconsideration which was also denied on September 23, 1994. 5 plaintiff Lourdes Osmeña and before the former died on October 25, 1990 he sired the six
(6) children who are now plaintiffs with their mother.” 12 This, to our mind, was sufficient
allegation that Joselito Daffon was a legitimate son of the spouses Amado and Concepcion
On October 25, 1994, petitioner filed a petition for certiorari with the Court of Appeals,
Daffon; and that plaintiffs (i.e., respondents herein) were likewise legitimate heirs of
docketed as CA-G.R. SP No. 35536. On November 14, 1996, the Court of Appeals

Page 13 of 100
Joselito Daffon. Admitting the truth of these averments, there was, therefore, no need to proper instruments of conveyance, and the court shall confirm the partition so
inquire whether respondent minor children were duly acknowledged by the deceased agreed upon.18
Amado Daffon. To be sure, the illegitimacy of the said children and the lack of
acknowledgment are matters which petitioner may raise as a defense in her answer and
Petitioner insists that in her testimony given in Civil Case No. 56336, respondent Lourdes
threshed out by the court during a full-blown trial.
Daffon admitted that the land in Mandaluyong was the only property left by the deceased
Amado Daffon. The pertinent portion of her testimony runs this way:
In the same vein, there is no need for the complaint to specifically allege respondents’
claim of co-ownership of the properties. The complaint needs only to allege the ultimate
Q         And because of that incident being the surviving spouse of Joselito
facts on which the plaintiffs rely for their claim. 13
Daffon, how did it affect you personally and also your husband at that time
when he was still alive?
The rules of procedure require that the complaint must make a concise
statement of the ultimate facts or the essential facts constituting the plaintiff’s
A         She (sic) felt sad and she (sic) suffered mental torture, mental anxiety
cause of action. A fact is essential if it cannot be stricken out without leaving the
and numerous sleepless nights for that is the only property left to us by my
statement of the cause of action inadequate. A complaint states a cause of
father-in-law and his son and his grandchildren.19
action only when it has its three indispensable elements, namely: (1) a right in
favor of the plaintiff by whatever means and under whatever law it arises or is
created; (2) an obligation on the part of the named defendant to respect or not We do not agree with petitioner’s interpretation of the above phrase. The foregoing
to violate such right; and (3) an act or omission on the part of such defendant statement, saying that the deceased only left the said Mandaluyong property to his son
violative of the right of plaintiff or constituting a breach of the obligation of Joselito, does not exclude the possibility that Amado owned other land and personal
defendant to the plaintiff for which the latter may maintain an action for belongings during his lifetime, which he may not have left to his son. This does not
recovery of damages.14 deprive Joselito or his successors-in-interest of the right to share in those other
properties. As a matter of fact, respondents’ complaint contains a long list of properties
allegedly owned by Amado Daffon.20 Again, the resolution of whether or not these
The allegations contained therein are sufficient to establish respondents’ right to the
belonged to Amado Daffon and formed part of his estate is a matter best taken up during
estate of Amado Daffon. By stating their relationship to the deceased, they established
trial and after an evaluation of the evidence to be presented by the contending parties.
their line of succession as the basis for their claim. Their rights to succeed as heirs were
transmitted from the moment of death of the decedent. 15
Petitioner argues that the order which denied the Motion to Dismiss is an interlocutory
order which is not appealable. Hence, it may be the subject of a special civil action for
Contrary to petitioner’s contention, the fact that she repudiated the co-ownership
certiorari. However, for certiorari to lie, it must be convincingly proved that the lower
between her and respondents did not deprive the trial court of jurisdiction to take
court committed grave abuse of discretion, or an act too patent and gross as to amount
cognizance of the action for partition. In a complaint for partition, the plaintiff seeks, first,
to an evasion of a positive duty, or a virtual refusal to perform the duty enjoined or act in
a declaration that he is a co-owner of the subject properties; and second, the conveyance
contemplation of law; or that the trial court exercised its power in an arbitrary and
of his lawful shares.16 As the Court of Appeals correctly held, an action for partition is at
despotic manner by reason of passion and personal hostility. 21 In the case at bar, the trial
once an action for declaration of co-ownership and for segregation and conveyance of a
court did not commit grave abuse of discretion in denying petitioner’s Motion to Dismiss.
determinate portion of the properties involved. If the defendant asserts exclusive title
Thus, the Court of Appeals was correct in dismissing the petition for certiorari.
over the property, the action for partition should not be dismissed. Rather, the court
should resolve the case and if the plaintiff is unable to sustain his claimed status as a co-
owner, the court should dismiss the action, not because the wrong remedy was availed We are indeed distressed by the circumstances under which the instant case reached this
of, but because no basis exists for requiring the defendant to submit to partition. If, on Court. Instead of filing an answer and meeting the issues head-on, petitioner and her
the other hand, the court after trial should find the existence of co-ownership among the counsel chose to elevate the incident of the denial of the Motion to Dismiss to the higher
parties, the court may and should order the partition of the properties in the same courts. In doing so, they effectively delayed the resolution of the case and the
action.17 adjudication of the respective rights of the parties by the court below. What makes this
case more reprehensible is that petitioner abused the legal process to delay her own
grandchildren’s expectancy to share in the estate left by their father and grandfather. If
An action for partition is comprised of two phases: first, an order for partition
there is any merit in her claim of absolute ownership over the contested properties, she
which determines whether a co-ownership in fact exists, and whether partition is
could have just allowed the case to be fully tried, during which she should have proved
proper; and, second, a decision confirming the sketch or subdivision submitted
her case with competent proof. While litigants may utilize all available means to defend
by the parties or the commissioners appointed by the court, as the case may be.
themselves, the legal strategies they employ should not amount to machinations which
The first phase of a partition and/or accounting suit is taken up with the
frustrate and prejudice the rights of others. Moreover, frivolous appeals, such as the one
determination of whether or not a co-ownership in fact exists, (i.e., not
filed in this case, are not countenanced in this jurisdiction.
otherwise legally proscribed) and may be made by voluntary agreement of all
the parties interested in the property. This phase may end with a declaration
that plaintiff is not entitled to have a partition either because a co-ownership WHEREFORE, in view of the foregoing, the instant petition is DENIED. The decision of
does not exist, or partition is legally prohibited. It may end, upon the other the Court of Appeals in CA-G.R. SP No. 35536 is AFFIRMED.
hand, with an adjudgment that a co-ownership does in truth exist, partition is
proper in the premises and an accounting of rents and profits received by the
defendant from the real estate in question is in order. In the latter case, the SO ORDERED.
parties may, if they are able to agree, make partition among themselves by

Page 14 of 100
Davide, Jr.*, and Austria-Martinez, J.,  concur. Vitug, J., acting Chairman.

Page 15 of 100
 THIRD DIVISION On March 6, 1998, the RTC, presided by Judge Ramon G. Codilla, Jr., issued an Order
denying the motion to dismiss, holding that:
G.R. No. 134230            July 17, 2002
"This court believes that this court has jurisdiction to try this case considering
that the real properties consist of ten parcels of land in a subdivision and the
JOVENAL OUANO, petitioner, vs.
court takes note that there is a discrepancy somewhere by the Office of the City
PGTT INTERNATIONAL INVESTMENT CORPORATION and HON. JUDGE RAMON G.
Assessor in the Assessment of the parcels of land for only less than  P2,000.00
CODILLA, JR., respondents.
and that the government is very much at a loss by these unrealistic valuation." 6

SANDOVAL-GUTIERREZ, J.:
Ouano filed a motion for reconsideration but was likewise denied by the RTC in its Order
dated May 27, 1998. The trial court ruled it has jurisdiction over the case because "(i)t is
PGTT International Investment Corporation (PGTT), respondent, is a corporation duly of judicial knowledge that the real properties situated in Cebu City command a higher
organized under existing laws, with address at YASCO Bldg., M. J. Cuenco Ave., Cebu valuation than those indicated in the tax declaration. The observation of plaintiff’s
City. (PGTT’s) counsel as to the issue on damages is likewise sustained considering that, being
a corporation, it may have incurred damages in the form of unrealized profits." 7
On December 11, 1997, PGTT filed with the Regional Trial Court (RTC), Branch 20, Cebu
City, a verified complaint against Jovenal Ouano, petitioner, docketed as Civil Case No. Hence the present petition for certiorari filed by Ouano under Rule 65 of the 1997 Rules of
CEB- 21319, entitled "PGTT INTERNATIONAL INVESTMENT CORPORATION, Plaintiff, vs. Civil Procedure, as amended, assailing the Orders of respondent judge dated March 6,
JUVENAL OUANO, Defendant," for "Recovery of Ownership and Possession of Real 1998 and May 27, 1998 as having been issued with grave abuse of discretion amounting
Property and Damages."1 In its complaint, PGTT alleged that it is the owner of Lot Nos. 1- to lack or excess of jurisdiction.
10, Block 2 of the Sunnymeade Crescent Subdivision located at Pit-os, Talamban, Cebu
City. Sometime in October of 1996, PGTT found that Ouano uprooted the concrete
At the outset, it is necessary to stress that a direct recourse to this Court is highly
monuments of the said lots, plowed them and planted corn thereon. Despite PGTT’s
improper, for it violates the established policy of strict observance of the judicial hierarchy
demand that he vacate the lots and restore them to their original condition, Ouano
of courts.8 We need to reiterate, for the guidance of petitioner, that this Court’s original
refused, claiming he is the owner and lawful possessor of the 380 square meters he
jurisdiction to issue a writ of certiorari (as well as prohibition, mandamus, quo
occupied. Due to Ouano’s wrongful act, PGTT was deprived of the use of its property and
warranto, habeas corpus and injunction) is concurrent with the Court of Appeals (CA),
suffered damages in the amount of P100,000.00 a year. Likewise, PGTT was constrained
as in the present case, and with the RTCs in proper cases within their respective
to file the subject action and hired the services of his counsel for P100,000.00. PGTT
regions.9 However, this concurrence of jurisdiction does not grant a party seeking any of
prayed:
the extraordinary writs the absolute freedom to file his petition with the court of his
choice. This Court is a court of last resort, and must so remain if it is to satisfactorily
"WHEREFORE, in view of all the foregoing, it is most respectfully prayed that perform the functions assigned to it by the Constitution and immemorial tradition. 10 The
after due notice and hearing, judgment be rendered ordering defendant (Jovenal hierarchy of courts determines the appropriate forum for such petitions. Thus, petitions
Ouano) to vacate the premises and restore the lots to their original condition; for the issuance of such extraordinary writs against the first level ("inferior") courts
pay plaintiff (PGTT) P100,000.00 as damages per year, beginning October, 1996 should be filed with the RTC, and those against the latter, with the CA. 11 A direct
until he shall have vacated the premises and restored the lots to their original invocation of this Court’s original jurisdiction to issue these writs should be allowed only
condition; pay P100,000.00 as attorney's fees; and pay P50,000.00 as expenses when there are special and important reasons therefor, clearly and specifically set out in
of litigation. the petition. This is the established policy. It is a policy that is necessary to prevent
inordinate demands upon this Court’s time and attention which are better devoted to
those matters within its exclusive jurisdiction, and to prevent further over-crowding of its
"Plaintiff prays for such other reliefs and remedies, just and equitable under the docket.12 Unfortunately, the instant petition does not allege any special and compelling
premises."2 reason to justify a direct recourse to this Court. However, we deem it more appropriate
and practical to resolve the controversy in order to avoid further delay, but only in this
On February 5, 1998, Ouano filed a motion to dismiss the complaint on the ground that it instance.
is the Municipal Trial Court (MTC), not the RTC, which has jurisdiction over it considering
that the assessed value of the lots involved is only P2,910, as indicated in the latest tax The lone issue for our resolution is whether the RTC has jurisdiction over Civil Case No.
declaration,3 citing Section 19 (paragraph 2) and Section 33 (paragraph 3) of Batas CEB-21319.
Pambansa Bilang  129 (The Judiciary Reorganization Act of 1980), as amended by
Republic Act No. 7691.4
The complaint seeks to recover from private respondent the ownership and possession of
the lots in question and the payment of damages. Since the action involves ownership
In its opposition to Ouano’s motion, PGTT contends that the RTC has jurisdiction since and possession of real property, the jurisdiction over the subject matter of the claim is
the market value of the lots is P49,760.00.5 Besides, the complaint is not only an action determined by the assessed value, not the market value, thereof, pursuant to Batas
for recovery of ownership and possession of real property, but also for damages Pambansa Blg. 129, as amended by R.A. 7691. Section 33 (paragraph 3) of the said law
exceeding P100,000.00, over which claim the RTC has exclusive original jurisdiction under provides:
Section 19 (paragraph 8) of the same law.

Page 16 of 100
 "Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and "SEC. 19. Jurisdiction in civil cases. – Regional Trial Courts shall exercise
Municipal Circuit Trial Courts in Civil Cases. –  Metropolitan Trial Courts, exclusive original jurisdiction:
Municipal Trial Courts and Municipal Circuit Trial Courts shall exercise:
xxx
x x x.
"(8) In all other cases in which the demand, exclusive of interest, damages of
(3) Exclusive original jurisdiction in all civil actions which involve title to, or whatever kind, attorney’s fees, litigation expenses, and costs or the value of the
possession of, real property, or any interest therein where the assessed property in controversy exceeds One Hundred Thousand Pesos (P100,000.00)
value of the property or interest therein does not exceed Twenty or, in such other cases in Metro Manila, where the demand, exclusive of the
Thousand Pesos (P20,000.00) or, in civil actions in Metro Manila, where such above mentioned items exceeds Two hundred thousand pesos (P200,000.00)."
assessed value does not exceed Fifty Thousand Pesos (Emphasis ours)
(P50,000.00) exclusive of interest, damages of whatever kind, attorney’s
fees, litigation expenses and costs: Provided, That in cases of land not
The above provision does not apply to the instant case. It is applicable only to "all  other
declared for taxation purposes, the value of such property shall be determined
cases" other than an action involving title to, or possession of real property  in
by the assessed value of the adjacent lots.
which the assessed value is the controlling factor in determining the court’s jurisdiction.
Besides, the same provision explicitly excludes from the determination of the
x x x." (Emphasis ours) jurisdictional amount the demand for "interest, damages of whatever kind,
attorney’s fees, litigation expenses, and costs". The exclusion of such damages is
reiterated in Section 33, paragraph 3 of the same Batas Pambansa Blg.  129, as amended,
Likewise, Section 19 (paragraph 2) of the same law reads:
quoted earlier. The said damages are merely incidental to, or a consequence of, the main
cause of action for recovery of ownership and possession of real property. In this
"Sec. 19. Jurisdiction in civil cases. -  The Regional Trial Court shall connection, this Court issued Administrative Circular No. 09-94 setting the guidelines in
exercise exclusive original jurisdiction: the implementation of R.A. 7691. Paragraph 2 states:

x x x. "2. The exclusion of the term ‘damages of whatever kind’ in determining

the jurisdictional amount under Section 19 (8) and Section 33 (1) of
B.P. Blg. 129, as amended by R.A. 7691, applies to cases where the
(2) In all civil actions, which involve the title to, or possession of, real damages are merely incidental to or a consequence of the main cause of
property, or any interest therein, where the assessed value of the action. However, in cases where the claim for damages is the main cause of
property involved exceeds Twenty Thousand Pesos (P20,000.00) or, for action, or one of the causes of action, the amount of such claim shall be
civil actions in Metro Manila, where such value exceeds Fifty Thousand Pesos considered in determining the jurisdiction of the court." (Emphasis ours)
(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 We thus find that in issuing the assailed orders denying petitioner’s motion to dismiss,
Courts; thus taking cognizance of the case, the RTC committed grave abuse of discretion.

x x x." (Emphasis ours) WHEREFORE, the instant petition is GRANTED. The assailed Orders issued by
respondent RTC on March 6, 1998 and May 27, 1998 in Civil Case No. CEB-21319
are SET ASIDE. Accordingly, the complaint is ordered DISMISSED. SO ORDERED.
It is undisputed that the assessed value of the property involved, as shown by the
corresponding tax declaration, is only P2,910.00. As such, the complaint is well within the
MTC’s P20,000.00 jurisdictional limit. Puno, Panganiban, and Carpio, JJ.,  concur.

The finding of respondent judge that the value of the lots is higher than that indicated in
the tax declaration and that, therefore, the RTC has jurisdiction over the case is highly
speculative. It is elementary that the tax declaration indicating the assessed value of the
property enjoys the presumption of regularity as it has been issued by the proper
government agency.

Respondent judge further held that since the complaint also seeks the recovery of
damages exceeding P100,000.00, then it is within the competence of the RTC pursuant to
Section 19 (paragraph 8) of Batas Pambansa Blg.  129, as amended by R.A. 7691, which
states:

Page 17 of 100
 FIRST DIVISION No appeal was taken by the plaintiff-appellant. The decision lapsed into finality and
became executory. A writ of execution was issued by virtue of which a notice to sell at
G.R. No. L-46000 March 18, 1985 public auction real properties belonging to the estate of Susana Agustin was issued by the
Deputy Sheriff to satisfy judgment in the case. Plaintiff's counsel filed a motion for
GLICERIO AGUSTIN (Deceased) as Administrator of the Intestate Estate of reconsideration, confessing his fault and giving the reason why he failed to perfect the
Susana Agustin, petitioner-plaintiff-appellant, vs. appeal on time. The motion was denied.
LAUREANO BACALAN and the PROVINCIAL SHERIFF OF CEBU, respondents-
defendants-appellees. Thereafter, with the aid of new counsel, the plaintiff-appellant filed a complaint with
Branch V, Court of First Instance of Cebu, against the defendant and the Deputy Sheriff of
GUTIERREZ, JR., J.: Cebu for the declaration of the nullity of the above-cited decision of Branch III, Court of
First Instance of Cebu in the ejectment case on the ground that the exercise of its
The precursor of this case was a complaint for ejectment with damages filed by plaintiff- appellate jurisdiction was null and void from the beginning for the following reasons:
appellant Agustin, as adininistrator of the Intestate Estate of Susana Agustin, against
defendant-appellee Bacalan, before the City Court of Cebu. (a) It grants relief in the total sum of P16,000.00 (exclusive of costs) distributed
thus:
Bacalan is a lessee of a one-door ground floor space in a building owned by the late
Susana Agustin. Due to nonpayment of rentals despite repeated demands an action to P10,000.00 as moral damages
eject him was filed.
P5,000.00 as exemplary damages
In his complaint, the plaintiff-appellant prayed that the defendant-appellee be ordered to
immediately vacate the place in question, to pay plaintiff-appellant the sum of P2,300.00 P1,000.00 as attorney's fees
representing arrearages in rentals plus the corresponding rentals until he actually vacates
the place, attorney's fees, expenses, and costs. which is clearly beyond the jurisdiction of the City Court of Cebu; Section 88 of
the Judiciary Act of 1948, as amended by Rep. Acts Nos. 2613 and 3828, limits
In his answer, the defendant-appellee included a counter-claim alleging that the present the jurisdiction of the city courts in civil cases to P10,000.00 as the maximum
action was "clearly unfounded and devoid of merits, as it is tainted with malice and bad amount of the demand (exclusive of interest and costs);
faith on the part of the plaintiff for the obvious reason that plaintiff pretty well knows that
defendant does not have any rentals in arrears due to the estate of Susana Agustin, but (b) Moreover, said Decision (Annex "G") grants moral damages to the defendant
notwithstanding this knowledge, plaintiff filed the present action merely to annoy, vex, in the sum of P10,000.00 which constitutes a grave abuse of discretion
embarrass and inconvenience the defendant." He stated, "That by virtue of the amounting to lack of jurisdiction, there being no evidence to support it and the
unwarranted and malicious filing of this action by the plaintiff against the defendant, the subject matter of the suit in Civil Case No. R-13504 being purely contractual
latter suffered, and will continue to suffer, actual and moral damages in the amount of no where moral damages are not recoverable.
less than P50,000.00; P10,000.00 in concept of exemplary damages. In addition,
defendant has been compelled to retain the services of undersigned counsel to resist A motion to dismiss was filed by the defendant on the grounds that the plaintiff has no
plaintiffs' reckless, malicious and frivolous claim and to protect and enforce his rights for cause of action and that the court lacks jurisdiction to declare the nullity of a decision of
which he obligated himself to pay the further sum of P3,500.00 as attorney's fees." another branch of the Court of First Instance of Cebu.

The City Court of Cebu subsequently rendered judgment dismissing the counterclaim and While rejecting the second ground for the motion to dismiss, the court sustained the
ordering the defendant to vacate the premises in question and to pay the plaintiff the sum defendant and ruled:
of P3,887.10 as unpaid back rentals and the sum of P150.00 as attorney's fees' From this
decision, the defendant filed an appeal with Branch Ill of the Court of First Instance of Clearly from a reading of the complaint, the plaintiff seeks the annulment of the
Cebu. The case was designated as Civil Case No. R-12430. decision rendered by the Third Branch of this Court because the award exceeded
the jurisdiction amount cognizable by the City Court of Cebu and the said
Availing of Republic Act 6031 which does away with trials de novo in appeals before it, the Branch III of this Court has no jurisdiction to award the defendants herein
Court of First Instance rendered a decision, the dispositive portion of which reads: (plaintiff in Civil Case No. 12430) an amount more than P10,000.00;

WHEREFORE, based on all the foregoing considerations, the appealed judgment It is the considered opinion of this Court that this allegation of the herein
is hereby set aside. Judgment is hereby required in favor of the defendant— plaintiff cannot be availed of as a ground for annulment of a judgment. It may
perhaps, or at most, be a ground for a petition for certiorari. But then, the
1. Ordering the plaintiff to pay. remedy should be availed of within the reglementary period to appeal.
Nevertheless, even if the plaintiff did take his cause by certiorari, just the same,
a) P10,000.00 as moral damages; it would have been futile....

b) P5,000.00 as exemplary damages; xxx xxx xxx

c) P1,000.00 as attorney's fees; and In fine, this Court believes that the present complaint fails to allege a valid
cause of action as the same is only a clear attempt at utilizing the remedy for
2. With costs against plaintiff. the annulment of the judgment rendered by this Court in Civil Case No. 12430
to offset the adverse effects of failure to appeal.
JUDGMENT REVERSED.

Page 18 of 100
Plaintiff-appellant's motion for reconsideration was denied, prompting him to file an excess of the jurisdiction of the city court as a compulsory counterclaim. What is the legal
appeal before the Court of Appeals, which, in a resolution, certified the same to us on the effect of such a move?
ground that it involves pure questions of law.
Pertinent to our disposition of this question is our pronouncement in the case of Hyson
We ruled in Macabingkil v. People's Homesite and Housing Corporation  (72 SCRA 326, Tan, et al. v. Filipinas Compania de Seguros, et al.,  (G.R. No. L-10096, March 23, 1956)
citing Reyes v. Barretto-Datu, 94 Phil. 446, 448-449)- later adopted in Pindangan Agricultural Co., Inc. v. Dans  (6 SCRA 14) and the later case
of One Heart Club, Inc. v. Court of Appeals  (108 SCRA 416) to wit:
Under our rules of procedure, the validity of a judgment or order of the court,
which has become final and executory, may he attacked only by a direct action xxx xxx xxx
or proceeding to annul the same, or by motion in another case if, in the latter
case, the court had no jurisdiction to enter the order or pronounce the judgment ... An appellant who files his brief and submits his case to the Court of Appeals
(section 44, Rule 39 of the Rules of Court). The first proceeding is a direct for decision, without questioning the latter's jurisdiction until decision is
attack against the order or judgment, because it is not incidental to, but is the rendered therein, should be considered as having voluntarily waives so much of
main object of, the proceeding. The other one is the collateral attack, in which his claim as would exceed the jurisdiction of said Appellate Court; for the reason
the purpose of the proceedings is to obtain some relief, other than the vacation that a contrary rule would encourage the undesirable practice of appellants
or setting aside of the judgment, and the attack is only an incident. (I Freeman submitting their cases for decision to the Court of Appeals in expectation of
on Judgments, sec. 306, pages 607-608.) A third manner is by a petition for favorable judgment, but with intent of attacking its jurisdiction should the
relief from the judgment order as authorized by the statutes or by the rules, decision be unfavorable. ...
such as those expressly provided in Rule 38 of the Rules of Court, but in this
case it is to be noted that the relief is granted by express statutory authority in Thus, by presenting his claim voluntarily before the City Court of Cebu, the defendant-
the same action or proceeding in which the judgment or order was entered ... appellee submitted the same to the jurisdiction of the court. He became bound thereby.
The amount of P10,000.00 being the jurisdictional amount assigned the City Court of
The question is thus poised, whether or not the present action for the annulment of the Cebu, whose jurisdiction the defendant-appellee has invoked, he is thereby deemed to
judgment in the ejectment case is the proper remedy after it has become final and have waived the excess of his claim beyond P10,000.00. It is as though the defendant-
executory. appellee had set up a counterclaim in the amount of P10,000.00 only. May the Court of
First Instance then, on appeal, award defendant-appellee's counterclaim beyond that
To this procedural dilemma, the solution lies in the determination of the validity of amount?
the judgment sought to be annulled, for against a void judgment, plaintiff-appellant's
recourse would be proper. The rule is that a counterclaim not presented in the inferior court cannot be entertained in
the Court of First Instance on appeal (Francisco, The Revised Rules of Court in the
There is no question as to the validity of the court's decision with respect to the issue of Philippines, Vol. III, p. 26, citing the cases of Bernardo v. Genato, 11 Phil. 603 and Yu Lay
physical possession of property, the defendant-appellee's right to the same having been v. Galmes, 40 Phil. 651). As explained in Yu Lay v. Galmes— "Upon an appeal to a court
upheld. However, the plaintiff-appellant assails the money judgment handed down by the of first instance from the judgment of a justice of the peace, it is not possible, without
court which granted damages to the defendant-appellee. By reason thereof, he seeks the changing the purpose of the appeal, to alter the nature of the question raised by the
declaration of the nullity of the entire judgment. complaint and the answer in the original action. There can be no doubt, therefore, of the
scope of the doctrine laid down in the several decisions of the Court. Consequently, We
It is the plaintiff-appellant's contention that moral damages may not properly be awarded hold that, upon an appeal to the Court of First Instance, the plaintiff as well as the
in ejectment cases, the only recoverable damages therein being the reasonable defendant cannot file any pleading or allegation which raises a question essentially
compensation for use and occupancy of the premises and the legal measure of damages distinct from that raised and decided in the justice of the peace court. "This rule was
being the fair rental value of the property. reiterated in cases from Ng Cho Cio v. Ng Diong  (1 SCRA 275) to Development Bank of
the Philippines v. Court of Appeals  (116 SCRA 636).
Plaintiff-appellant loses sight of the fact that the money judgment was awarded the
defendant-appellee in the concept of a counterclaim. A defending party may set up a Thus, the defendant-appellee's counterclaim beyond P10,000.00, the jurisdictional
claim for money or any other relief which he may have against the opposing party in a amount of the city Court of Cebu, should be treated as having been deemed waived. It is
counterclaim (Section 6, Rule 6, Revised Rules of Court). And the court may, if as though it has never been brought before trial court. It may not be entertained on
warranted, grant actual, moral, or exemplary damages as prayed for. The grant of moral appeal.
damages, in the case at bar, as a counterclaim, and not as damages for the unlawful
detention of property must be upheld. However, the amount thereof is another matter. The amount of judgment, therefore, obtained by the defendant-appellee on appeal,
cannot exceed the jurisdiction of the court in which the action began. Since the trial court
Plaintiff-appellant raises the issue of whether or not the Court of First Instance may, in an did not acquire jurisdiction over the defendant's counterclaim in excess of the
appeal, award the defendant-appellee's counterclaim in an amount exceeding or beyond jurisdictional amount, the appellate court, likewise, acquired no jurisdiction over the same
the jurisdiction of the court of origin. by its decisions or otherwise. Appellate jurisdiction being not only a continuation of the
exercise of the same judicial power which has been executed in the court of original
It is well-settled that a court has no jurisdiction to hear and determine a set-off or jurisdiction, also presupposes that the original and appellate courts are capable of
counterclaim in excess of its jurisdiction (Section 5, Rule 5, Revised Rules of Court; Ago participating in the exercise of the same judicial power (See 2 Am. Jur. 850; Stacey
v. Buslon, 10 SCRA 202). A counterclaim beyond the court's jurisdiction may only be Cheese Company v. R.E. Pipkin, Appt. 155 NC 394, 71 S.E. 442, 37 LRA 606) It is the
pleaded by way of defense, the purpose of which, however, is only to defeat or weaken essential criterion of appellate jurisdiction that it revises and corrects the proceedings in a
plaintiff's claim, but not to obtain affirmative relief (Section 5, Rule 5, Revised Rules of cause already instituted, and does not create that cause (See 2 Am. Jur 850 citing
Court). Nevertheless, the defendant-appellee, in the case at bar, set up his claim in Marbury v. Madison, 1 Cranch US, 137, 2 L. ed. 60).

Page 19 of 100
It is, of course, a well-settled rule that when court transcends the limits prescribed for it
by law and assumes to act where it has no jurisdiction, its adjudications will be utterly
void and of no effect either as an estoppel or otherwise (Planas v. Collector of Internal
Revenue, 3 SCRA 395; Parades v. Moya, 61 SCRA 526). The Court of First Instance, in
the case at bar, having awarded judgment in favor of the defendant-appellee in excess of
its appellate jurisdiction to the extent of P6,000.00 over the maximum allowable award of
P10,000.00, the excess is null and void and of no effect. Such being the case, an action to
declare the nullity of the award as brought by the plaintiff-appellant before the Court of
First Instance of Cebu, Branch V is a proper remedy.

The nullity of such portion of the decision in question, however, is not such as to affect
the conclusions reached by the court in the main case for ejectment. As held in  Vda. de
Pamintuan v. Tiglao  (53 Phil. 1) where the amount set up by the defendant was not
proper as a defense and it exceeded the inferior court's jurisdiction, it cannot be
entertained therein, but the court's jurisdiction over the main action will remain
unaffected. Consequently, the decision over the main action, in the case at bar, must
stand, best remembering that a counter-claim, by its very nature, is a cause of action
separate and independent from the plaintiff's claim against the defendant.

WHEREFORE, the decision of the Court of First Instance of Cebu, Branch III in Civil Case
No. R-12430 for ejectment is hereby DECLARED NULL AND VOID insofar as it awards
damages on the defendant-appellee's counterclaim in excess of P6,000.00 beyond its
appellate jurisdiction. The decision in all other respects is AFFIRMED. The order of the
Court of First Instance of Cebu, Branch V dismissing Civil Case No. R-13462 for
declaration of nullity of judgment with preliminary injunction is hereby MODIFIED, Civil
Case No. R-13462 is ordered DISMISSED insofar as the decision sought to be annulled
upholds the defendant's right to possession of the disputed property. The defendant's
counterclaim for damages is GRANTED to the extent of TEN THOUSAND (P10,000.00)
PESOS. The grant of SIX THOUSAND (P6,000.00) PESOS in excess of such amount is
hereby declared NULL and VOID, for having been awarded beyond the jurisdiction of the
court.

SO ORDERED.

Teehankee (Chairman), Melencio-Herrera, Plana, Relova, De la Fuente and Alampay, JJ.,

concur.

Page 20 of 100
 FIRST DIVISION In his answer to the complaint, Maceda set up a counterclaim for P240,000, the alleged
value of his improvements.
G.R. No. 83545 August 11, 1989
In its decision, the Metropolitan Trial Court ordered him to vacate the premises and pay
ADELFO MACEDA, petitioner, vs. the plaintiff P2,000 per month as reasonable compensation for his use of the premises
HON. COURT OF APPEALS AND CEMENT CENTER, INC., respondents. until he actually vacates, and P5,000 as attorney's fees. It ordered the plaintiff to pay the
defendant P158,000 as the value of his improvements and repairs, less his accrued
Charles S. Anastacio for petitioner. rentals of P64,000 as of December 1985 and the sum of P12,000 which he had earlier
F.M. Carpio & Associates for private respondent. received as partial reimbursement.
GRIÑ;O-AQUINO, J.: Both parties appealed to the Regional Trial Court. The Regional Trial Court set aside the
inferior court's decision. On May 19, 1987, it dismissed the ejectment complaint, and
The issue raised in this case is the jurisdiction of the metropolitan trial court, in an ordered Cement Center to pay Maceda P182,000 for as necessary and useful
ejectment case, over the lessee's counterclaim for the value of improvements exceeding improvements (pp. 31-49, Rollo of CA-G.R. No. 12536).
the court's jurisdictional limit of P20,000. The Court of Appeals dismissed the
counterclaim for lack of jurisdiction, hence, this petition for review by the lessee, Adelfo Cement Center filed a petition for review in the Court of Appeals (CA-G.R. SP No. 12536).
Maceda. On February 17, 1988, the Court of Appeals rendered a decision, modifying the appealed
decision, the dispositive part of which leads thus:
The leased property originally belonged to the spouses Arturo Victoria and Maxima
Monserrat, a maternal aunt of the petitioner. After the spouses emigrated to the U.S. in PREMISES CONSIDERED, the decision appealed from is hereby AFFIRMED
1970, they leased their house and lot in San Juan, Metro Manila, to the petitioner for insofar as it dismissed the complaint for ejectment filed by petitioner against
P200 per month in 1970. As the house was old and run down, petitioner proposed to have private respondent. However, the, portions of the decision declaring petitioner
it repaired and renovated subject to reimbursement of his expenses. The lessors allowed (plaintiff) under obligation to pay private respondent the sum of P182,200.00
him to do so (Exh. 3) and requested him to send them pictures of the work accomplished corresponding to the value of the supposed necessary and useful improvement
(Exh. 3-a). He made extensive repairs, tearing down rotten parts of the house, rebuilding as well as the pronouncement therein regarding private respondent's right of
and extending it up to the garage which he converted into a dining room. He also moved retention hereby SET ASIDE. With costs against petitioner. (p. 35, Rollo.)
the bathrooms around. The remodelling job cost P40,000. His aunt and uncle were
pleased with the pictures of the remodelled house and made plans to reimburse him for The reason for the Court of Appeals' denial of Maceda's claim for reimbursement of the
his expenditures. But Maceda did not stop there. In what appears to be an orgy of cost of his improvements was that the MTC lacked jurisdiction over the claim which
building, he introduced more improvements. He constructed a new driveway, a basketball exceeds P20,000. The Court of Appeals said:
court and raised the ground level near the creek, elevated the fence, remodelled the gate,
and landscaped the lawn. The Regional Trial Court, however, erred in declaring that petitioner is under
obligation to pay private respondents the sum of P182,200.00 supposedly
In 1972, Arturo Victoria passed away in the United States. In 1973, his aunt's attorney- corresponding to the value of the necessary and useful improvements he had
in-fact, Atty. Rustico Zapata, Sr., promised to sell the property to him for P125,000 after introduced on the leased premises, with the right of retention until he shall have
the title should have been transferred to his widowed aunt. On February 12, 1974, Atty. been fully reimbursed therefor. The claim for reimbursement in the total amount
Zapata and a Mr. Gomez visited the place and informed him that his aunt had sold the of P240,000.00 was alleged by private respondent by way of counterclaim in his
property to Mrs. Gomez so he should vacate it. He refused to leave. As a result, Atty. answer (pp. 40-41, Records). It is clear that the amount of counterclaim, is
Zapata filed an ejectment case against him on April 4, 1974, in the Municipal Court of San beyond the jurisdiction of the Metropolitan Trial Court. Under Section 33, B.P.
Juan, Rizal (Civil Case No. 3773).lâwphî1.ñèt  It was dismissed on the plaintiffs own Blg. 129, the Metropolitan Trial Court shall have exclusive original jurisdiction
motion. over civil actions where the amount of the demand does not exceed P20,000.00
exclusive of interest and costs but inclusive of damages of whatever kind. It
In November 1974, Atty. Zapata informed the petitioner that the property had been sold goes without saying that the Regional Trial Court has no authority to entertain
to Pablo Zubiri for P145,000. He was asked to vacate it. Again, he refused. Zubiri filed an the counterclaim because it took cognizance of the case by virtue of its appellate
ejectment case against am (Civil Case No. 37781) in the Municipal Court of San Juan, jurisdiction.
Rizal. Petitioner insisted that he was entitled to retain possession of the premises until his
expenses were duly reimbursed to him. The complaint was dismissed for failure to Considering that the Metropolitan Trial Court did not have jurisdiction to
prosecute. adjudicate the counterclaim, the decision of the Regional Trial Court on appeal
giving private respondent the right of retention is without legal basis. Besides,
In 1978 Maxima Monserrat died in the United States. the right of retention applies only to a possessor in good faith under Article 546
of the Civil Code. In lease, the lessee knows that his occupancy of the premises
On December 4, 1981, the property was sold by Zubiri to Cement Center, Inc. which continues only during the lifetime of the lease contract. If he introduces
obtained TCT Nos. 30844 to 30845 for the property. The president of the company improvements thereon, he does so at his own risk (Imperial Insurance vs.
inspected the premises. Maceda was asked to vacate the property because the company Simon, 14 SCRA 855).lâwphî1.ñèt  The rights of a lessee in good faith, which do
would build a housing project on it for its employees. Maceda insisted on being not include the right of retention, are defined in Article 1678, . . . (pp. 34-35,
reimbursed for his improvements as the original owners had promised to do. Formal Rollo.)
demands to vacate and for payment of P4,000 monthly rental from April 15, 1982 were
sent to him by the company. On January 17, 1984, another ejectment suit was filed In his petition for review of that decision in this Court, Maceda assails the setting aside of
against him in the Metropolitan Trial Court of San Juan, Metro Manila. the money judgment or award for his improvements in the sum of P182,200, and the
rejection of his claim to a right of retention over the leased premises.

Page 21 of 100
Maceda's petition for review (G.R. No. 83545) has no merit. The Court of Appeals
Month
correctly ruled that the municipal trial court did not have original jurisdiction over his
counterclaim as it exceeds P20,000. Correspondingly, the regional trial court did not have
appellate jurisdiction over the claim. The decision of the Municipal Trial Court of San Juan April 15, 1984 to April 14, 1985 P 266.20 P 3,194.40
awarding him P158,000 on his counterclaim, and that of the Regional Trial Court raising
the award to P182,200, were invalid for lack of jurisdiction. The jurisdiction of the
Metropolitan Trial Court in a civil action for sum of money (Maceda's counterclaim for the +20%- April 15, 1985 to April 14, 1986 319.44 3,833.28
value of his improvements is one such action) is limited to a demand that "does not
exceed twenty thousand pesos exclusive of interest and costs but inclusive of damages of
whatever kind." (Sec. 33, subpar. 1, B.P. Blg. 129.) A counterclaim in the municipal or April 15, 1986 to April 14, 1987 383.32 4,599.84
city court beyond that jurisdictional limit may be pleaded only by way of defense to
weaken the plaintiffs claim, but not to obtain affirmative relief. (Agustin vs. Bacalan, 135
SCRA 340). April 15, 1987 to April 14, 1988 459.98 5,519.75

Maceda was not a possessor in good faith, i.e., one who possesses in concept of an
owner, hence he had no right to retain possession of the leased premises pending April 15, 1988 to April 14, 1989 551.97 6,623.64
reimbursement of his improvements thereon. No mere lessee can claim to be a possessor
in good faith. (Art. 546, Civil Code; Eusebio vs. IAC, 144 SCRA 154; Laureano vs. Adil, 72
SCRA 148.)
April 15, 1989 to August 14, 1989 662.36 2,649.44
The promise of the now deceased spouses Arturo Victoria and Maxima Monserrat, to
reimburse Maceda for his improvements was limited only to the initial remodelling job
which cost P40,000, pictures of which he sent to the Victorias and which they approved P32,864.36
and promised to reimburse. No similar promise to pay may be implied with regard to the
additional improvements which he made without their approval and which were evidently WHEREFORE, the petition for review is granted with respect to the computation of the
intended to improve them out of their property. rentals due from the petitioner. He is ordered to pay the unpaid rentals of P32,864.36 for
his occupancy of the private respondent's property from December 1981 to August 14,
In any event, since the undertaking of the Victorias to reimburse Maceda for the P40,000
1989 plus P662.36 monthly thereafter until he vacates the premises. The dismissal of his
worth of improvements which he introduced on their property was not recorded on their
counterclaim for the value of his improvements is affirmed. No pronouncement as to
title, that promise did not encumber the property nor bind the purchaser thereof or the
costs.
successor-in-interest of the Victorias (Mun. of Victorias vs. CA, 149 SCRA 32).lâwphî1.ñèt
SO ORDERED.
While it is true that under B.P. Blg. 877 a lessee may not be ejected on account of the
sale or mortgage of the leased premises, the new owner's need of the premises for the Narvasa, Cruz, Gancayno, and Medialdea, JJ., concur.
construction of dwellings for its employees, coupled with the lessee's failure to pay the
rentals since December 1981, are, to our mind, a legitimate ground for the judicial
ejectment of the lessee.

Maceda's original rental of P200 per month could not be increased by the new owner,
Cement Center, when it acquired the property on December 5, 1981 until B.P. Blg. 25
allowed a cumulative and compounded 10% yearly increase effective April 15,1982, and a
20% increase effective April 15, 1985, pursuant to B.P. Blg. 867 and 887 and R.A. 6643.
Based on those guidelines, the rentals due from Maceda from December 4, 1981 were as
follows:

Per Total
Month

December 4, 1981 to April 14, 1982 P 200.00 P 900.00

+10%- April 15, 1982 to April 14, 1983 220.00 2,640.00

April 15, 1983 to April 14, 1984 242.00 2,904.00

Per Total

Page 22 of 100
 EN BANC  2. He be paid back salaries, transportation, representation and housing
allowances and such other benefits withheld from him from the date of his illegal
G.R. No. 101428 August 5, 1992 demotion/transfer.

DR. ISABELITA VITAL-GOZON, in her official capacity as MEDICAL CENTER CHIEF No motion for reconsideration of this Resolution was ever submitted nor appeal therefrom
OF THE NATIONAL CHILDREN'S HOSPITAL, petitioner, vs. essayed to the Supreme Court, within the thirty-day period prescribed therefor by the
THE HONORABLE COURT OF APPEALS and DR. ALEJANDRO S. DE LA Constitution. 3 Consequently, the resolution became final, on September 21, 1988.
FUENTE, respondents.
De la Fuente thereupon sent two (2) letters to Dr. Vital-Gozon, the Medical Center Chief
Gregorio San Agustin for private respondent. of National Children's Hospital, 4 demanding the implementation of the Commission's
decision. Dr. Vital-Gozon referred "de la Fuente's claims to the Department of Health
NARVASA, C.J.: Assistant Secretary for Legal Affairs for appropriate advice and/or action . . (She did this
allegedly because, according to the Solicitor General, she was) unaware when and how a
Whether or not the Court of Appeals has jurisdiction, in a special civil action CSC Resolution becomes final and executory, whether such Resolution had in fact become
of mandamus against a public officer, to take cognizance of the matter of damages final and executory and whether the DOH Legal Department would officially assail the
sought to be recovered from the defendant officer, is the chief issue raised in mentioned Resolution." 5 But she did not answer Dr. de la Fuente's letters, not even to
the certiorari action at bar. Also put the issue is whether or not the Solicitor General may inform him of the referral thereof to the Assistant Secretary. She chose simply to await
represent the defendant public officer in the mandamus suit, in so far as the claim for "legal guidance from the DOH Legal Department." On the other hand, no one in the DOH
damages is concerned, in light of the Court's rulings in Urbano , et al. v. Chavez, et al., Legal Department bothered to reply to Dr. de la Fuente, or to take steps to comply or
and Co v. Regional Trial Court of Pasig, et al. 1 otherwise advise compliance, with the final and executory Resolution of the Civil Service
Commission. In fact, de la Fuente claims that Vital-Gozon had "actually threatened to
There is no dispute about the facts from which these issues arise.
stop paying . . . (his) salary and allowances on the pretext that he has as yet no
In the early months of 1987 — and pursuant to Executive Order No. 119 issued on 'approved' appointment even as 'Medical Specialist II' . . . 6
January 30, 1987 by President Corazon Aquino — reorganization of the various offices of
Three months having elapsed without any word from Vital-Gozon or anyone in her behalf,
the Ministry of Health commenced; existing offices were abolished, transfers of personnel
or any indication whatever that the CSC Resolution of August 9, 1988 would be obeyed,
effected.
and apprehensive that the funds to cover the salaries and allowances otherwise due him
At the time of the reorganization, Dr. Alejandro S. de la Fuente was the Chief of the would revert to the General Fund, Dr. de al Fuente repaired to the Civil Service
Clinics of the National Children's Hospital, having been appointed to that position on Commission and asked it to enforce its judgment. He was however "told to file  in court a
December 20, 1978. Prior thereto, he occupied the post of Medical Specialist II, a position petition
to which he was promoted in 1977 after serving as Medical Specialist I of the same for mandamus because of the belief that the Commission had no coercive powers  —
hospital for six (6) years (since 1971). unlike a court — to enforce  its final decisions/resolutions. 7

On February 4, 1988 Dr. de la Fuente received notice from the Department of Health that So he instituted in the Court of Appeals on December 28, 1988 an action of
he would be re-appointed "Medical Specialist II." Considering this is to be a demotion by "mandamus  and damages with preliminary injunction" to compel Vital-Gozon, and the
no less than two ranks from his post as Chief of Clinics, Dr. de la Fuente filed a protest Administrative Officer, Budget Officer and Cashier of the NCH to comply with the final and
with the DOH Reorganization Board. When his protest was ignored, he brought his case to executory resolution of the Civil Service Commission. He prayed for the following specific
the Civil Service Commission where it was docketed as CSC Case No. 4. In the meantime reliefs:
"the duties and responsibilities pertaining to the position of Chief of Clinics were turned
(1) (That) . . a temporary restraining order be issued immediately, ordering the
over to and were allowed to be exercised by Dr. Jose D. Merencilla,
principal and other respondents to revert the funds the of the NCH
Jr." 2
corresponding to the amounts necessary to implement the final resolution of the
Dr. de la Fuente's case was decided by the Civil Service Commission in a Resolution dated CSC in CSC Case No. 4 in favor of herein petitioner, Dr. Alejandro S. de la
August 9, 1988. In that Resolution, the Commission made the following conclusion and Fuente, Jr., and to pay such sums which have accrued and due and payable as
disposition, to wit: of the date of said order;

. . (The Commission) declares the demotion/transfer of appellant de la Fuente, (2) After hearing on the prayer for preliminary injunction, that the restraining
Jr. from Chief of Clinics to Medical Specialists II as null and void: hence, illegal. order be converted to a writ of preliminary injunction; and that a writ of
Considering further that since the National Children's Hospital was not abolished preliminary mandatory injunction be issued ordering principal respondent and
and the position therein remained intact although the title or the position of the other respondents to implement in full the said final resolution; and
Chief of Clinics was changed to "Chief of Medical Professional Staff" with
(3) That, after hearing on the merits of the petition, that judgment be rendered
substantially the same functions and responsibilities, the Commission hereby
seeking (sic) permanent writs issued and that principal respondent be ordered
orders that:
and commanded to comply with and implement the said final resolution without
1. Appellant de la Fuente, Jr. be retained or considering as never having further delay; and, furthermore, that the principal respondent be ordered to pay
relinquished his position of Chief of Clinics (now Chief of Medical Professional to the sums of P100,000.00 and P20,000.00 as moral and exemplary damages,
Staff) without loss of seniority rights; and and P10,000.00 for litigation expenses and attorney's fees.

xxx xxx xxx

Page 23 of 100
The Court of Appeals required the respondents to answer. It also issued a temporary . . . respondents, particularly Dr. Isabelita Vital-Gozon, . . . to forthwith comply
restraining order as prayed for, and required the respondent to show cause why it should with, obey and implement the resolution CSC Case No. 4 (and) . . . Dr. Jose D.
not be converted to a writ of preliminary injunction. The record shows that the Merencilla, Jr., who is not entitled to the office, . . . to immediately cease and
respondents prayed for and were granted an extension of fifteen (15) days to file their desist from further performing and acting as OIC Professional Service.
answer "through counsel, who," as the Court of Appeals was later to point out, 8 "did not
bother to indicate his address, thus notice was sent to him through the individual But de la Fuente's prayer for damages — founded essentially on the refusal of Gozon, et
respondents. . . . (However, no) answer was filed; neither was there any show cause ( sic) al. to obey the final and executory judgment of the Civil Service Commission, which thus
against a writ of preliminary injunction." It was a certain Atty. Jose Fabia who appeared in compelled him to litigate anew in a different forum — was denied by the Court of Appeals
Vital-Gozon's behalf. 9 on the ground that the "petitions (for mandamus) are not the vehicle nor is the Court the
forum for . . . (said) claim of damages."
About a month afterwards, de la Fuente filed with the same Court a
"Supplemental/Amended Petition" dated February 2, 1989. The second petition described Gozon acknowledged in writing that she received a copy of the Appellate Tribunal's
as one for "quo warranto" aside from "mandamus", added three respondents including Dr. Decision of June 9, 1989 on June 15, 1989. 12 Respondent de la Fuente acknowledged
Jose Merencilla, Jr.; and alleged inter alia that he (de la Fuente) had "clear title" to the receipt of his own copy on June 15, 1989. 13 Neither Vital-Gozon nor her co-party, Dr.
position in question in virtue of the final and executory judgment of the Civil Service Merencilla, Jr., moved for reconsideration of, or attempted to appeal the decision.
Commission; that even after the Commission's judgment had become final and executory
and been communicated to Vital-Gozon, the latter allowed "Dr. Merencilla, Jr. as 'OIC It was de la Fuente who sought reconsideration of the judgment, by motion filed through
Professional Service' to further usurp, intrude into and unlawfully hold and exercise the new counsel, Atty. Ceferino Gaddi. 14 He insisted that the Appellate Court had competence
public office/position of petitioner, (under a duly approved permanent appointment as to award damages in a mandamus action. He argued that while such a claim for damages
'Chief of Clinics' since 1978). De la Fuente thus prayed, additionally, for judgment: might not have been proper in a mandamus proceeding in the Appellate Court "before the
enactment of B.P. Blg. 129 because the Court of Appeals had authority to issue such writs
(a) Declaring that principal respondent Dr. Jose D. Merencilla, Jr. is not legally only 'in aid of its appellate jurisdiction,'" the situation was changed by said BP 129 in
entitled to the office of "Chief of Clinics" (now retitled/known as "Chief of virtue of which three levels of courts — the Supreme Court, the Regional Trial Court, and
Medical Professional Staff," NCH), ousting him therefrom and ordering said the Court of Appeals — were conferred concurrent original jurisdiction to issue said writs,
respondent to immediately cease and desist from further performing as "OIC and the Court of Appeals was given power to conduct hearings and receive evidence to
Professional Service" any and all duties and responsibilities of the said office; resolve factual issues. To require him to separately litigate the matter of damages he
(and) continued, would lead to that multiplicity of suits which is abhorred by the law.

(b) Declaring that the petitioner, Dr. Alejandro S. de la Fuente, Jr., is the lawful While his motion for reconsideration was pending, de la Fuente sought to enforce the
or de jure Chief of Clinics (now known as "Chief of the Medical Professional judgment of the Court of Appeals of June 9, 1989 — directing his reinstatement pursuant
Staff") and placing him in the possession of said office/position, without the to the Civil Service Commission's Resolution of August 9, 1988, supra. He filed on July 4,
need of reappointment or new appointment as held by the Civil Service 1989 a "Motion for Execution," alleging that the judgment of June 9, 1989 had become
Commission in its resolution of August 9, 1988, in CSC Case No. 4. final and executory for failure of Gozon, et al. — served with notice thereof on June 16,
1989 to move for its reconsideration or elevate the same to the Supreme Court. 15 His
xxx xxx xxx motion was granted by the Court of Appeals in a Resolution dated July 7, 1989,  16 reading
as follows:
Copy of the "Supplemental/Amended Petition" was sent to Atty. Jose A. Fabia, Counsel for
Respondents c/o Dr. Ma. Isabelita Vital-Gozon, etc., National Children's Hospital, E. The decision of June 9, 1989 having become final and executory, as prayed for,
Rodriguez Ave., Quezon City (Atty. Fabia's address not being indicated or mentioned in let the writ of execution issue forthwith.
his motion for Extension of
Time). 10 The corresponding writ of execution issued on July 13, 1989, 17 on the invoked authority
of Section 9, Rule 39. 18 The writ quoted the dispositive portion of the judgment of June 9,
Again the Court of Appeals required answer of the respondents. Again, none was filed. 1989, including, as the Solicitor General's Office points out, the second paragraph to the
The petitions were consequently "resolved on the basis of their allegations and the effect that the petitions "are not the vehicle nor is the Court the forum for the claim of
annexes." The Appellate Court promulgated its judgment on June 9, 1989. 11 It held that damages; (hence,) the prayer therefor is denied."
—
The writ of execution notwithstanding, compliance with the June 9, 1989 judgment was
The question of whether petitioner may be divested of his position as Chief of not effected. Consequently, de la Fuente filed, on July 20, 1989, an "Urgent Ex
Clinics by the expedient of having him appointed to another, lower position is no Parte Manifestation with Prayer to Cite Respondents for Contempt," complaining that
longer an issue. It ceased to be such when the resolution in CSC Case No. 4 although Gozon and her co-parties had been served with the writ of execution on July 14,
became final. The said resolution is explicit in its mandate; petitioner was they had not complied therewith. By Resolution dated July 26, 1989, the Court required
declared the lawful and de jure Chief of Clinics (Chief of the Medical Professional Gozon and Merencilla to appear before it on August 3, 1989 to answer the charge and
Staff) of the National Children's Hospital, and by this token, respondent Dr. Jose show cause "why they should not be adjudged in contempt for disobeying and/or resisting
D. Merencilla, Jr. is not legally entitled to the office. Respondents, particularly the judgment." 19
Dr. Isabelita Vital-Gozon, had no discretion or choice on the matter; the
resolution had to be complied with. It was ill-advised of principal respondent, At the hearing Gozon and Merencilla duly presented themselves, accompanied by their
and violative of the rule of law, that the resolution has not been obeyed or individual private lawyers — one for Gozon (Felipe Hidalgo, Jr.), two for Merencilla
implemented. (Bernardo S. Nera and Moises S. Rimando). One other lawyer appeared in their behalf,
from the Health Department, Artemio Manalo, who stated that he was there "in behalf of
and accordingly ordered — Jose A. Fabia." 20 They explained that they had no intention to defy the Court, they had

Page 24 of 100
simply referred the matter to their superiors in good faith; and they were perfectly willing promulgated on March 19, 1990 in G.R. No. 87977 (Urbano, et al. v. Chavez, et
to comply with the judgment, undertaking to do so "even in the afternoon" of that same al.) and G.R. No. 88578 (Co v. Regional Trial Court of Pasig). 29
day. The Court consequently ordered them "to comply with their undertaking . . . without
any further delay," and report the action taken towards this end, within five (5) days. Notice of this Resolution of January 11, 1991 was served on the Solicitor General's Office
on January 18, 1991. 30 Again the Solicitor General sought reconsideration, by motion
On August 9, 1989, Gozon as "Medical Center Chief," sent a letter to Associate Justice dated January 25, 1991 and filed on January 30, 1991. 31 Again it was rebuffed. In a
Pedro A. Ramirez, advising that under Hospital Special Order No. 31 dated August 3, Resolution rendered on August 7, 1991, 32 served on the Solicitor General's Office on
1989, de la Fuente had been directed to assume the position of Chief of the Medical August 20, 1991, 33 the Court of Appeals denied the motion. It ruled that the "question of
Professional Staff, and that a voucher for the payment of his allowances had been the authority of the Solicitor General to appear as counsel for respondent Gozon . . . (had
prepared and was being processed. 21 already) been extensively discussed," and that its "jurisdiction . . . to hear and determine
issues on damages proceeds from Sec. 9, Batas Pambansa 129 as amended."
More than a month later, or more precisely on September 27, 1989, the Court of Appeals
promulgated another Resolution, this time resolving de la Fuente's motion for In an attempt to nullify the adverse dispositions of the Court of
reconsideration of June 29, 1989. 22 It modified the Decision of June 9, 1989 by (a) Appeals — and obtain "the ultimate and corollary relief of dismissing respondent de la
deleting its last paragraph (disallowing the claim of damages, supra), (b) consequently Fuente's claim for damages" — the Solicitor General's Office had instituted the special civil
describing and treating it as a "PARTIAL DECISION," and (c) scheduling "further action of certiorari  at bar. It contends that the Court of Appeals is not legally competent
proceedings for the purpose of receiving evidence (of damages)," since said question to take cognizance of and decide the question of damages in a mandamus suit. It argues
"cannot be resolved by mere reference to the pleadings." 23 This was done in reliance on that —
Section 3, Rule 65 of the Rules of Court, invoked by de la Fuente, which reads as
follows:24 1) B.P. Blg. 129 does not confer jurisdiction upon the Court of Appeals to hear, as a trial
court, claims for moral and exemplary damages;
Sec. 3. Mandamus. — When any tribunal, corporation, board, or person
unlawfully neglects the performance of an act which the law specifically enjoins 2) assuming that the Court of Appeals does have jurisdiction over the claims for
as a duty resulting from an office, trust, or station, or unlawfully excludes damages, it lost the power to take cognizance thereof after the Decision of June 9, 1989
another from the use and enjoyment of a right or office to which such other is had, by its own pronouncement, become final and executory; and
entitled, and there is no other plain, speedy and adequate remedy in the
ordinary course of law, the person aggrieved thereby may file a verified petition 3) the Urbano  and Co  doctrines cited by the Appellate Tribunal do not disqualify the
in the proper court alleging the facts with certainty and praying that judgment Solicitor General's Office from representing government officials sued in their official
be rendered commanding the defendant, immediately or at some other specified capacities and in damage claims not arising from a felony.
time, to do the act required to be done to protect the rights of the petitioner,
and to  pay the damages sustained by the petitioner by reason of the wrongful It is in light of these facts, just narrated, that this Court will now proceed to deal with the
acts of the defendant. legal issues raised in this action. But first, a few brief observations respecting the
proceedings in the Civil Service Commission.
At about this time, yet another lawyer, Atty. Pedro F. Martinez entered his appearance for
Isabelita Gozon. 25 At his instance, the Court gave him an "opportunity to . . . file a I
motion for reconsideration" of the Resolution of September 27, 1989. 26 That motion he
The record demonstrates that Vital-Gozon was fully aware of the following acts and
filed by registered mail on November 10, 1989. 27 His basic contentions were (a) that the
events: 34
decision of June 9, 1989 could no longer be altered, having become final and executory
and having in fact been executed, and (b) that under BP 129, the Appellate Court had no 1) the proceedings commenced by de la Fuente in the Civil Service Commission in protest
jurisdiction over the question of damages in a mandamus action. against his demotion;
The Office of the Solicitor General also put in an appearance in Gozon's behalf at this 2) the Commission's Resolution of August 9, 1988 as well, particularly, as the direction
juncture, saying that the case had been referred to it only on November 14, 1989. It, too, therein that de la Fuente be reinstated and paid all his back salaries and other monetary
sought reconsideration of the Resolution of September 27, 1989. It filed on November 16, benefits otherwise due him, this being couched in fairly simple language obviously
1989 an "Omnibus Motion; I. For Reconsideration of Resolution dated September 27, understandable to persons of ordinary or normal intelligence;
1989; and II. To defer hearing on petitioner's claims for damages." 28
3) no less than two (2) written demands of de la Fuente for implementation of the CSC's
Both motions were denied by the Court of Appeals in a Resolution dated January 11, aforesaid Resolution of August 9, 1988;
1991. In that Resolution, the Court —
4) the petition filed by de la Fuente in the Court of Appeals for enforcement of the CSC
1) declared that the amended decision had already become final and could no Resolution of August 9, 1988;
longer be re-opened because, although "a copy of the amendatory resolution
was received by counsel who was representing Gozon on October 3, 1989," the 5) the extension granted by said Court of Appeals within which to file answer, notice
first motion for reconsideration was not mailed until November 10, 1989 and the thereof having been sent directly to her and her co-respondents since the attorney who
Solicitor General's "Omnibus Motion" was not filed until November 16, 1989; sought the extension in their behalf (Atty. Fabia) did not set out his address in his motion
and for extension;
2) prohibited the Solicitor General from representing Gozon "in connection with . 6) the "supplemental/amended petition" subsequently presented by de la Fuente, copy of
. . (de la Fuente's) claim for damages," on the authority of this Court's ruling which was sent to Atty. Fabia, c/o Dr. Vital-Gozon; and

Page 25 of 100
7) the Decision and Amendatory Decision sent to her counsel on October 3, 1989. and exemplary damages, as those claimed by . . . (de la Fuente)," it follows that the
Court of Appeals has no competence to act on said claim of damages. And Section 3 of
To all these, her reaction, and that of the officials of the Department of Health concerned, Rule 65, which authorizes the petitioner in a mandamus suit to pray for judgment
was a regrettably cavalier one, to say the least. Neither she nor the Health officials commanding the defendant inter alia "to pay the damages sustained by the petitioner by
concerned accorded said acts and events any importance. She never bothered to find out reason of the wrongful acts of the defendant," is "nothing more than a procedural rule
what was being done to contest or negate de la Fuente's petitions and actions, allowing joinder of causes of action, i.e., mandamus  and damages," and such an award of
notwithstanding that as time went by, de la Fuente's efforts were being met with success. damages is allowable only in actions commenced in Regional Trial Courts but not in the
Court of Appeals or this Court.
Nothing in the record even remotely suggests that Vital-Gozon merits relief from the final
and executory Resolution of the Civil Service Commission. This Court will not disturb that The argument is specious. It cannot be sustained.
Resolution. It is satisfied that no procedural or substantive errors taint that Resolution, or
its becoming final and executory. The Solicitor General's Office correctly identifies Section 9, B.P. 129 as the legal provision
specifying the original and appellate jurisdiction of the Court of Appeals. The section
II pertinently declares that the "Intermediate Appellate Court (now the Court of Appeals)
shall exercise . .," among others:
Now, final and executory judgments are enforced by writ of execution and not by another,
separate action, whether of mandamus or otherwise. Hence, execution of the Civil Service . . . Original jurisdiction to issue writs of mandamus, prohibition, certiorari,
Commission's decision of August 9, 1988 should have been ordered and effected by the habeas corpus, and quo warranto, and auxiliary writs or processes, whether or
Commission itself, when de la Fuente filed a motion therefor. It declined to do so, not in aid of its appellate jurisdiction . . . 38
however, on the alleged ground, as de la Fuente claims he was told, that it "had no
coercive powers  — unlike a court — to enforce  its final decisions/resolutions." 35 That The Solicitor General's Office evidently searched said Section 9 for an explicit and specific
proposition, communicated to de la Fuente, of the Commission's supposed lack of statement regarding "actions for moral and exemplary damages," and finding none,
coercive power to enforce its final judgments, is incorrect. It is inconsistent with previous concluded that the Court of Appeals had not been granted competence to assume
acts of the Commission of actually directing execution of its decisions and resolutions, cognizance of claims for such damages. The conclusion is incorrect. Section 19, governing
which this Court has sanctioned in several cases; 36 and it is not in truth a correct the exclusive original jurisdiction of Regional Trial Courts in civil cases, contains no
assessment of its powers under the Constitution and the relevant laws. reference whatever to claims "for moral and exemplary damages," and indeed does not
use the word "damages" at all; yet it is indisputable that said courts have power to try
In an En Banc  Decision promulgated on October 15, 1991 in G.R. No. 96938 entitled and decide claims for moral, exemplary and other classes of damages accompanying any
"Government Service Insurance System (GSIS) versus Civil Service Commission, et of the types or kinds of cases falling within their specified jurisdiction. The Solicitor
al.,"37 this Court declared that in light of the pertinent provisions of the Constitution and General's theory that the rule in question is a mere procedural one allowing  joinder of an
relevant statutes — action of mandamus and another for damages, is untenable, for it implies that a claim for
damages arising from the omission or failure to do an act subject of a mandamus suit
. . . it would appear absurd to deny to the Civil Service Commission the power may be litigated separately from the latter, the matter of damages not being inextricably
or authority to enforce or order execution of its decisions, resolutions or orders linked to the cause of action for mandamus, which is certainly not the case.
which, it should be stressed, it has been exercising through the years. It would
seem quite obvious that the authority to decide cases in inutile unless Now, at the time of the enactment of B.P. 129, the issuance of the extraordinary writs
accompanied by the authority to see that what has been decided is carried out. above mentioned was controlled by the Rules of Court of 1964, as they continue to date
Hence, the grant to a tribunal or agency of adjudicatory power, or the authority to be so controlled. More particularly, the principal writs of mandamus, prohibition
to hear and adjudge cases, should normally and logically be deemed to include and certiorari were (and continue to be) governed by Rule 65; the writ of habeas corpus,
the grant of authority to enforce or execute the judgments it thus renders, by Rule 102; and the writ of quo warranto, by Rule 66. The so-called auxiliary writs were
unless the law otherwise provides. (and continue to be) also governed by the same code — e.g., preliminary attachment, by
Rule 57; preliminary injunction, by Rule 58, receivership, by Rule 59; writ of seizure or
In any event, the Commission's exercise of that power of execution has been delivery in a replevin suit, by Rule 60.
sanctioned by this Court in several cases.
At that time, Section 3 of Rule 65 authorized (as it continues to authorize to date)
Be this as it may, the fact is that by reason of the Commission's mistaken refusal to rendition of judgment in a mandamus action "commanding the defendant, immediately or
execute its final and executory Resolution of August 9, 1988, extended proceedings have at some other specified time, to do the act required to be done to protect the rights of the
taken place in the Court of Appeals and certain issues have been expressly raised in petitioner, and to pay the damages sustained by the petitioner by reason of the wrongful
relation thereto, supra. Those issues appear to the Court to be important enough to acts of the defendant."  39 The provision makes plain that the damages are an incident, or
deserve serious treatment and resolution, instead of simply being given short shrift by a the result of, the defendant's wrongful act in failing and refusing to do the act required to
terse ruling that the proceedings in the Court Service Commission actually had the power be done. It is noteworthy that the Rules of 1940 had an identical counterpart provision. 40
to execute its final and executory Resolution.
Moreover, Section 4 of the same Rule 65 authorized, as it continues to authorize to date,
III the filing of the petition "in the Supreme Court, or, if it relates to the acts or omissions of
an inferior court, or of a corporation, board, officer or person, in a Court of First Instance
The first such issue is whether or not the Court of Appeals has jurisdiction to take (now Regional Trial Court) having jurisdiction thereof," as well as "in the Court of
cognizance of the matter of damages in a special civil action of mandamus. The Solicitor Appeals  (whether or not) 41 in aid of its appellate jurisdiction."
General's Office argues that since jurisdiction is conferred only by law, not by agreement
of the parties, or acquiescence of the court, and since the law conferring jurisdiction on
the Court of Appeals, Section 9 of B.P. Blg. 129, makes no reference to "actions for moral

Page 26 of 100
Worthy of note, too, is that Rule 66 of the Rules of Court similarly authorizes the recovery There would seem to be no question about the timeliness of de la Fuente's motion for
of damages in a quo warranto action against a corporate officer — an action within the reconsideration of the June 9, 1989 decision. As already narrated, notice of said decision
concurrent jurisdiction of the Court of Appeals — as follows: 42 was served on him on the 15th of June, and his motion for reconsideration was presented
on June 29, 1989, or fourteen (14) days after receiving a copy of the judgment, i.e.,
Sec. 14. Liability of officer neglecting to deliver property of corporation to within the fifteen-day period prescribed by Section 1, Rule 37 of the Rules of Court for
receiver. — An officer of such corporation who refuses or neglects, upon filing a motion for new trial reconsideration.
demand, to deliver over to the receiver all money, property, books, deeds,
notes, bills, obligations, and papers of every description within his power or This being so, it would certainly have been entirely within the authority of the Court of
control, belonging to the corporation, or in any wise necessary for the Appeals, under normal circumstances, to rule on that motion for reconsideration and, in
settlement of its affairs, or the discharge of its debts and liabilities, may be its discretion, act favorably on it, as it did through its Resolution of September 27, 1991
punished for contempt as having disobeyed a lawful order of the court, and shall — by amending the decision of June 9, 1989, declaring it a partial judgment, and setting
be liable to the receiver for the value of all money or other things so refused or a date for reception of evidence on the la Fuente's claim for damages.
neglected to be surrendered, together with all damages that may have been
sustained by the stockholders and creditors of the corporation, or any of them, It would also appear that the motions for reconsideration of said Resolution of September
in consequence of such neglect or refusal. 27, 1991 separately submitted in Gozon's behalf, by her own private attorney and by the
Solicitor General's Office, were filed way out of time. As also already pointed out, notice
An award of damages was and is also allowed in connection with the auxiliary writ of of that Resolution of September 27, 1991 was served on Gozon's counsel on October 3,
preliminary attachment, preliminary injunction or receivership which the Court of Appeals 1989 and on Gozon herself on October 4, 1989; but the motion for reconsideration of
has the power to issue in common with the Supreme Court and the Regional Trial Atty. Martinez (Gozon's private lawyer) was not filed until November 10, 1989, thirty-
Courts, 43 payable by the sureties of the bond given in support of the writ, upon eight (38) days afterwards, and that of the Solicitor General, until November 16, 1989, or
seasonable application and summary hearing. 44 forty-four (44) days later. What is worse is that, its motion for reconsideration of
November 16, 1989 having been denied by a Resolution dated January 11, 1991, notice
Since it cannot but be assumed that in formulating, and incorporating in BP 129, the of which it received on January 18, 1991, the Solicitor General's Office filed still another
provision governing the jurisdiction of the Intermediate Appellate Court, now Court of motion for reconsideration on January 30, 1991, ostensibly directed against that
Appeals, the Batasang Pambansa  was fully cognizant of the relevant provisions of the Resolution of January 11, 1991 but actually seeking the setting aside of the Resolution of
Rules of Court just cited, as well as the rule against multiplicity of actions, it follows that September 17, 1989. In effect it filed a second motion for reconsideration which, of
in conferring on the Court of Appeals original jurisdiction over the special civil action course, is prohibited by law. 46
of mandamus, among others, as well as over the issuance of auxiliary writs or processes,
the Batasang Pambansa  clearly intended that said Court should exercise all the powers However, disposition of the question simply and solely on the foregoing premises is
then possessed by it under the Rules of Court in relation to said action of  mandamus and precluded by the fact that prior to the promulgation by the Appellate Court of its
auxiliary writs, including the adjudication of damages to the petitioner in the action in Resolution of September 27, 1989. — granting de la Fuente's motion for reconsideration
appropriate cases. of June 29, 1989 — de la Fuente had asked for and been granted by the Court of Appeals,
authority to execute the decision of June 9, 1989 and had in fact succeeded in bringing
IV about satisfaction thereof,  in so far as concerned his reinstatement to the position from
which he had been illegally ousted and the payment to him his salaries and allowances.
The next issue is whether or not the Solicitor General may properly represent a public
official like Dr. Vital-Gozon, who is sued for damages for allegedly refusing to comply with It has therefore become essential to determine the effect of the execution of said decision
a lawful and executory judgment of competent authority. The doctrine laid down in of June 9, 1989 at de la Fuente's instance, on the power of the Court of Appeals to modify
the Urbano  and Co  cases already adverted to, 45 is quite clear: that judgment as earlier prayed for by de la Fuente in such a way as to concede the
latter's capacity to claim damages in his mandamus action, and consequently authorize
. . . (T)he Office of the Solicitor General is not authorized to represent a public him to present evidence on the matter.
official at any stage of a criminal case. . . .
The general rule is that when a judgment has been satisfied, it passes beyond review,
This observation should apply as well to a public official who is haled to court on satisfaction being the last act and end of the proceedings, and payment of satisfaction of
a civil  suit for damages arising from a felony allegedly committed by him the obligation thereby established produces permanent and irrevocable
(Article 100, Revised Penal Code). Any pecuniary liability he may be held to discharge; 47 hence, a judgment debtor who acquiesces in and voluntarily complies with
account for on the occasion of such civil suit is for his own account. The State is the judgment, is estopped from taking an appeal therefrom. 48
not liable for the same. A  fortiori, the Office of the Solicitor General likewise has
no authority to represent him in such a civil suit for damages. On the other hand the question of whether or not a judgment creditor is estopped from
appealing or seeking modification of a judgment which has been executed at his instance,
It being quite evident that Dr. Vital-Gozon is not here charged with a crime, or civilly is one dependent upon the nature of the judgment as being indivisible or not. This is the
prosecuted for damages arising from a crime, there is no legal obstacle to her being doctrine laid down by this Court in a case decided as early as 1925, Verches v. Rios. 49 In
represented by the Office of the Solicitor General. that case this Court held that although "there are cases holding the contrary view,"  where
the judgment is indivisible, "the weight of authority is to the effect that an acceptance of
V full satisfaction of the judgment annihilates the right to further prosecute the appeal; . . .
that a party who has recovered judgment on a claim which cannot be split up  and made
The last issue is whether or not the decision of the Court of Appeals of June 9, 1989 could
the basis of several causes of action, and afterwards coerced full satisfaction by writ of
still be modified after it was pronounced final and executory and was in fact executed with
execution or authority of the court, cannot maintain an appeal from the judgment against
respect to de la Fuente's reinstatement to his position and the payment of the salaries
the objections of the judgment debtor;" and that even partial execution by compulsory
and allowances due him.
legal process at the instance of a party in whose favor a judgment appealed from was

Page 27 of 100
rendered, places said party in estoppel to ask that the judgment be amended, either "by from, the Resolution of the Court of Appeals amending its original judgment, within the
appeal or answer to his adversary's appeal, or otherwise." 50 time prescribed therefor by law, said amendatory resolution has long since become final
and immutable, particularly in so far as it holds itself competent to take cognizance of the
A converso, where the judgment is divisible, estoppel should not operate against the matter of damages and authorizes the reception of evidence on de la Fuente's claim
judgment creditor who causes implementation of a part of the decision by writ of therefor.
execution. This is the clear import of Verches  and the precedents therein invoked. It is an
aspect of the principle above mentioned that is fully consistent not only with the WHEREFORE, the petition is DENIED, and the challenged Resolutions of September 27,
dissenting opinion that "(a)cceptance of payment of . . . only the uncontroverted part of 1989, January 11, 1991 and August 7, 1991 are AFFIRMED, without pronouncement as to
the claim  . . . should not preclude the plaintiff from prosecuting his appeal, to determine costs.
whether he should not have been allowed more," 51 but also with logic and common
sense. SO ORDERED.

In this case, the amended judgment of the Court of Appeals is clearly divisible, Gutierrez, Jr., Cruz, Feliciano, Padilla, Bidin, Griño-Aquino, Medialdea, Regalado, Davide,
satisfaction of which may be "split up." One part has reference to the enforcement of the Jr., Romero, Nocon and Bellosillo, JJ., concur.
final and executory judgment of the Civil Service Commission, that de la Fuente should be
reinstated to the position of Chief of Clinics (now Chief of Medical Professional Staff)
without loss of seniority rights and that he be paid his back salaries and all monetary
benefits due him from the date of his illegal demotion. This part is no longer issuable, and
has not in truth been controverted by Gozon herself. The other part has reference to the
damages which de la Fuente contends he suffered as a result of the unjustified refusal of
Gozon and her co-parties to comply with the final and executory judgment of the Civil
Service Commission, and which the Appellate Tribunal has allowed him to prove.
Obviously, the second part cannot possibly affect the first. Whether de la Fuente succeeds
or fails in his bid to recover damages against Gozon, et al. because of their refusal to
obey the judgment of the Civil Service Commission, is a contingency that cannot affect
the unalterable enforceability of that judgment. Similarly, the enforcement of the
Commission's judgment (already accomplished by writ of execution of the Court of
Appeals issued at de la Fuente's instance) cannot influence in any manner the question
whether or not there was culpable refusal on the part of Gozon, et al. to comply with said
judgment when first required so to do, and whether de la Fuente did in fact suffer
compensable injury thereby.

It bears stressing that the juridical situation in which de la Fuente finds himself is not of
his making. It is a consequence of circumstances not attributable to any fault on his
part, i.e., the unwarranted refusal or neglect of his superiors to obey the executory
judgment of the Civil Service Commission; the erroneous refusal of the Commission to
execute its own decision which made necessary, in de la Fuente's view, the filing of
a mandamus action in the Court of Appeals; the initial refusal of the latter Court to
acknowledge his right to damages in connection with the mandamus suit; and ultimately,
the change of view by the Court of Appeals, on de la Fuente's motion, as regards its
competence to take cognizance of the matter of damages in relation to
the mandamus proceeding.

Under these circumstances, there was no reason whatsoever to defer concession to de la

Fuente of the relief of reinstatement — to which he
was indisputably already entitled — in the meantime that issues arising after finality of
the Civil Service Commission's judgment were being ventilated and resolved — these
issues being, to repeat, whether or not the refusal by Gozon, et al. obey said judgment of
the Commission could be justified, and whether or not, by reason of that refusal to obey,
de la Fuente did in fact suffer compensable injury.

It was therefore correct for the Court of Appeals, albeit by implication, to treat its
judgment as divisible, or capable of being enforced by parts, and to consider de la Fuente
as not having been placed in estoppel to pursue his claim for damages by seeking and
obtaining authority for a partial execution of the judgment. De la Fuente not being in
estoppel, it follows that his motion for reconsideration, timely filed, was not deemed
abandoned or waived by the partial execution of the judgment, and jurisdiction of the
Court of Appeals to amend the judgment was retained and not lost. It follows, too, that
since no motion for reconsideration was filed against, or appeal attempted to be taken

Page 28 of 100
 THIRD DIVISION After trial on the merits, the court a quo rendered a Decision dated July 3, 1995 6 in favor
of petitioner, the dispositive portion of which reads:
G.R. No. 139031             October 18, 2004
"22. WHEREFORE, the court hereby renders judgment as follows:
MARIE ANTOINETTE R. SOLIVEN, petitioner, vs.
FASTFORMS PHILIPPINES, INC., respondent. 22.1. The defendant FASTFORMS PHILS., INC. is ordered to pay the
plaintiff, MARIE ANTOINETTE R. SOLIVEN, the following amounts:
DECISION
22.1.1. ₱175,000.00 – the amount of the loan and its interest
SANDOVAL-GUTIERREZ, J.: covered by the check (Exh. 3);

For our resolution is the instant petition for review on certiorari 1 assailing the 22.1.2. Five (5%) percent of ₱175,000.00 – a month from
Decision2 dated February 8, 1999 and Resolution dated June 17, 1999, both issued by the June 25, 1993 until the ₱175,000.00 is fully paid – less the
Court of Appeals in CA-G.R. CV No. 51946. sum of ₱76,250.00 – as interest;

Records show that on May 20, 1994, Marie Antoinette R. Soliven, petitioner, filed with the 22.1.3. ₱50,000.00 – as attorney’s fees.
Regional Trial Court, Branch 60, Makati City a complaint for sum of money with damages
against Fastforms Philippines, Inc., respondent, docketed as Civil Case No. 94-1788. 22.2. The COMPLAINT for MORAL and EXEMPLARY damages is
DISMISSED.
The complaint alleges that on June 2, 1993, respondent, through its president Dr.
Eduardo Escobar, obtained a loan from petitioner in the amount of One Hundred Seventy 22.3. The COUNTERCLAIM is DISMISSED; and
Thousand Pesos (₱170,000.00), payable within a period of twenty-one (21) days, with an
interest of 3%, as evidenced by a promissory note 3 executed by Dr. Escobar as president 22.4. Costs is taxed against the defendant."
of respondent. The loan was to be used to pay the salaries of respondent’s employees. On
the same day, respondent issued a postdated check (dated June 25, 1993) 4 in favor of Respondent then filed a motion for reconsideration 7 questioning for the first time the trial
petitioner in the amount of ₱175,000.00 (representing the principal amount of court’s jurisdiction. It alleged that since the amount of petitioner’s principal demand
₱170,000.00, plus ₱5,000.00 as interest). It was signed by Dr. Escobar and Mr. Lorcan (₱195,155.00) does not exceed ₱200,000.00, the complaint should have been filed with
Harney, respondent's vice-president. About three weeks later, respondent, through Dr. the Metropolitan Trial Court pursuant to Republic Act No. 7691.8
Escobar, advised petitioner not to deposit the postdated check as the account from where
Petitioner opposed the motion for reconsideration, stressing that respondent is barred
it was drawn has insufficient funds. Instead, respondent proposed to petitioner that the
from assailing the jurisdiction of the trial court since it has invoked the latter’s jurisdiction
₱175,000.00 be "rolled-over," with a monthly interest of 5% (or ₱8,755.00). Petitioner
by seeking affirmative relief in its answer to the complaint and actively participated in all
agreed to the proposal. Subsequently, respondent, through Dr. Escobar, Mr. Harney and
stages of the trial.9
Mr. Steve Singson, the new president, issued several checks in the total sum of
₱76,250.00 in favor of petitioner as payment for interests corresponding to the months of
In its Order dated October 11, 1995,10 the trial court denied respondent’s motion for
June, August, September, October and December, 1993. Later, despite petitioner’s
reconsideration, holding that it has jurisdiction over the case because the totality of the
repeated demands, respondent refused to pay its principal obligation and interests due.
claim therein exceeds ₱200,000.00. The trial court also ruled that respondent, under the
principle of estoppel, has lost its right to question its jurisdiction.
In her complaint, petitioner prays:
On appeal, the Court of Appeals reversed the trial court’s Decision on the ground of lack
"WHEREFORE, premises considered, it is respectfully prayed of this Honorable
of jurisdiction. The Appellate Court held that the case is within the jurisdiction of the
Court that judgment be rendered:
Metropolitan Trial Court, petitioner’s claim being only ₱195,155.00; and that respondent
(a) holding/declaring defendant (now respondent) guilty of breach of may assail the jurisdiction of the trial court anytime even for the first time on appeal.
contract x x x; and
Petitioner filed a motion for reconsideration but was denied by the Court of Appeals in its
(b) ordering defendant to pay plaintiff (now petitioner) the following Resolution dated June 17, 1999.11
sums:
Hence, this petition.
₱195,155.00 as actual damages;
The fundamental issue for our resolution is whether the trial court has jurisdiction over
₱200,000.00 as moral damages; Civil Case No. 94-1788.

₱100,000.00 as exemplary damages; and Section 1 of Republic Act No. 7691, which took effect on April 15, 1994 12 or prior to the
institution of Civil Case No. 94-1788, provides inter alia that where the amount of the
₱100,000.00 as attorney’s fees, plus the costs of suit. demand in civil cases instituted in Metro Manila exceeds ₱200,000.00, exclusive of
interest, damages of whatever kind, attorney’s fees, litigation expenses, and costs, the
Plaintiff prays for such other relief just and equitable in the premises." exclusive original jurisdiction thereof is lodged with the Regional Trial Court.

Respondent, in its answer with counterclaim, 5 denied that it obtained a loan from Under Section 3 of the same law, where the amount of the demand in the complaint
petitioner; and that it did not authorize its then president, Dr. Eduardo Escobar, to secure instituted in Metro Manila does not exceed ₱200,000.00, exclusive of interest, damages of
any loan from petitioner or issue various checks as payment for interests. whatever kind, attorney’s fees, litigation expenses, and costs, the exclusive original

Page 29 of 100
jurisdiction over the same is vested in the Metropolitan Trial Court, Municipal Trial Court affirmative relief – the reconstitution of their titles. Private respondents have
and Municipal Circuit Trial Court. thus foreclosed their right to raise the issue of jurisdiction by their own actions.

In Administrative Circular No. 09-94 dated March 14, 1994, we specified the guidelines in "The Court has constantly upheld the doctrine that while jurisdiction may be
the implementation of R.A. 7691. Paragraph 2 of the Circular provides: assailed at any stage, a litigant’s participation in all stages of the case before
the trial court, including the invocation of its authority in asking for affirmative
"2. The exclusion of the term ‘damages of whatever kind’ in determining the relief, bars such party from challenging the court’s jurisdiction (PNOC Shipping
jurisdictional amount under Section 19 (8) and Section 33 (1) of B.P. Blg. 129, and Transport Corporation vs. Court of Appeals, 297 SCRA 402 [1998]). A party
as amended by R.A. No. 7691, applies to cases where the damages are merely cannot invoke the jurisdiction of a court to secure affirmative relief against his
incidental to or a consequence of the main cause of action. However, in cases opponent and after obtaining or failing to obtain such relief, repudiate or
where the claim for damages is the main cause of action, or one of the causes of question that same jurisdiction (Asset Privatization Trust vs. Court of Appeals,
action, the amount of such claim shall be considered in determining the 300 SCRA 579 [1998]; Province of Bulacan vs. Court of Appeals, 299 SCRA 442
jurisdiction of the court." (underscoring ours) [1998]). The Court frowns upon the undesirable practice of a party participating
in the proceedings and submitting his case for decision and then accepting
Here, the main cause of action is for the recovery of sum of money amounting to only judgment, only if favorable, and attacking it for lack of jurisdiction, when
₱195,155.00. The damages being claimed by petitioner are merely the consequences of adverse (Producers Bank of the Philippines vs. NLRC, 298 SCRA 517 [1998],
this main cause of action. Hence, they are not included in determining the jurisdictional citing Ilocos Sur Electric Cooperative, Inc. vs. NLRC, 241 SCRA 36 [1995])."
amount. It is plain from R.A. 7691 and our Administrative Circular No. 09-94 that it is the (underscoring ours)
Metropolitan Trial Court which has jurisdiction over the instant case. As correctly stated
by the Court of Appeals in its assailed Decision: WHEREFORE, the instant petition is GRANTED. The assailed Decision dated February 8,
1999 and Resolution dated June 17, 1999 of the Court of Appeals in CA-G.R. CV No.
"Conformably, since the action is principally for the collection of a debt, and the 51946 are REVERSED. The Decision dated July 3, 1995 and Resolution dated October 11,
prayer for damages is not one of the main causes of action but merely a 1995 of the Regional Trial Court, Branch 60, Makati City in Civil Case No. 94-1788 are
consequence thereto, it should not be considered in determining the jurisdiction hereby AFFIRMED.
of the court."
SO ORDERED.
While it is true that jurisdiction may be raised at any time, "this rule presupposes that
estoppel has not supervened."13 In the instant case, respondent actively participated in all Panganiban, Corona,  and Carpio Morales*, JJ., concur.
stages of the proceedings before the trial court and invoked its authority by asking for an
affirmative relief. Clearly, respondent is estopped from challenging the trial court’s
jurisdiction, especially when an adverse judgment has been rendered. In PNOC Shipping
and Transport Corporation vs. Court of Appeals,14 we held:

"Moreover, we note that petitioner did not question at all the jurisdiction of the
lower court x x x in its answers to both the amended complaint and the second
amended complaint. It did so only in its motion for reconsideration of the
decision of the lower court after it had received an adverse decision. As this
Court held in Pantranco North Express, Inc. vs. Court of Appeals (G.R. No.
105180, July 5, 1993, 224 SCRA 477, 491), participation in all stages of the
case before the trial court, that included invoking its authority in asking for
affirmative relief, effectively barred petitioner by estoppel from challenging the
court’s jurisdiction. Notably, from the time it filed its answer to the second
amended complaint on April 16, 1985, petitioner did not question the lower
court’s jurisdiction. It was only on December 29, 1989 when it filed its motion
for reconsideration of the lower court’s decision that petitioner raised the
question of the lower court’s lack of jurisdiction. Petitioner thus foreclosed its
right to raise the issue of jurisdiction by its own inaction." (underscoring ours)

Similarly, in the subsequent case of Sta. Lucia Realty and Development, Inc. vs.
Cabrigas,15 we ruled:

"In the case at bar, it was found by the trial court in its 30 September 1996
decision in LCR Case No. Q-60161(93) that private respondents (who filed the
petition for reconstitution of titles) failed to comply with both sections 12 and 13
of RA 26 and therefore, it had no jurisdiction over the subject matter of the
case. However, private respondents never questioned the trial court’s
jurisdiction over its petition for reconstitution throughout the duration of LCR
Case No. Q-60161(93). On the contrary, private respondents actively
participated in the reconstitution proceedings by filing pleadings and presenting
its evidence. They invoked the trial court’s jurisdiction in order to obtain

Page 30 of 100
 FIRST DIVISION The explanation of defendant IÑEGO has merit. The order dated 12 August 2002 was sent
to a wrong address, thus defendant IÑEGO did not receive it. Since it was not received,
G. R. No. 166876             March 24, 2006 he was not aware that the court would grant no further extension. The Motion to Admit
Motion to Dismiss has to be granted and the Motion to declare Defendant IÑEGO [in
ARTEMIO INIEGO,1Petitioner, vs. default] has to be DENIED.
The HONORABLE JUDGE GUILLERMO G. PURGANAN, in his official capacity as
Presiding Judge of the Regional Trial Court, Branch 42, City of Manila, and xxxx
FOKKER C. SANTOS, Respondents.
The plaintiff opines that this court has exclusive jurisdiction because the cause of action is
DECISION the claim for damages, which exceeds P400,000.00. The complaint prays for actual
damages in the amount of P40,000.00, moral damages in the amount of P300,000.00,
CHICO-NAZARIO, J.: and exemplary damages in the amount of P150,000.00. Excluding attorney’s fees in the
amount of P50,000.00, the total amount of damages being claimed is P490,000.00.
For this Court to grant this petition for review on certiorari under Rule 45 of the Rules of
Court, petitioner has to persuade us on two engaging questions of law. First, he has to Proceeding on the assumption that the cause of action is the claim of (sic) for damages in
convince us that actions for damages based on quasi-delict are actions that are capable of the total amount of P490,000.00, this court has jurisdiction. But is the main cause of
pecuniary estimation, and therefore would fall under the jurisdiction of the municipal action the claim for damages?
courts if the claim does not exceed the jurisdictional amount of P400,000.00 in Metro
Manila. Second, he has to convince us that the moral and exemplary damages claimed by This court is of the view that the main cause of action is not the claim for damages but
the private respondent should be excluded from the computation of the above-mentioned quasi-delict. Damages are being claimed only as a result of the alleged fault or negligence
jurisdictional amount because they arose from a cause of action other than the negligent of both defendants under Article 2176 of the Civil Code in the case of defendant Pinion
act of the defendant. and under Article 2180 also of the Civil Code in the case of defendant Iniego. But since
fault or negligence (quasi-delicts) could not be the subject of pecuniary estimation, this
Petitioner urges us to reverse the 28 October 2004 Decision and 26 January 2005 court has exclusive jurisdiction.
Resolution of the Court of Appeals, Eighth Division, in CA-G.R. SP No. 76206 denying due
course to the petition for certiorari filed by petitioner under Rule 65, elevating the 21 xxxx
October 2002 Omnibus Order and the 21 January 2003 Order of the Regional Trial Court
(RTC), Branch 42, City of Manila. The dispositive portion of the 28 October 2004 Decision WHEREFORE, in view of all the foregoing, the motion to declare defendant Iniego in
of the Court of Appeals reads: default and the said defendant’s motion to dismiss are denied.3

WHEREFORE, the petition is DENIED DUE COURSE and DISMISSED for lack of merit.2 On 7 November 2002, petitioner filed a Motion for Reconsideration of the Omnibus Order
of 21 October 2002. On 21 January 2003, public respondent issued an Order denying
The factual and procedural antecedents of this case are as follows: petitioner’s motion for reconsideration. Pertinent portions of the 21 January 2003 Order
are reproduced hereunder:
On 1 March 2002, private respondent Fokker Santos filed a complaint for quasi-delict and
damages against Jimmy T. Pinion, the driver of a truck involved in a traffic accident, and What this court referred to in its Order sought to be reconsidered as not capable of
against petitioner Artemio Iniego, as owner of the said truck and employer of Pinion. The pecuniary estimation is the CAUSE OF ACTION, which is quasi-delict and NOT the amount
complaint stemmed from a vehicular accident that happened on 11 December 1999, when of damage prayed for.
a freight truck allegedly being driven by Pinion hit private respondent’s jitney which
private respondent was driving at the time of the accident. xxxx

On 24 August 2002, private respondent filed a Motion to Declare defendant in Default WHEREFORE, in view of the foregoing, the motion for reconsideration is DENIED.4
allegedly for failure of the latter to file his answer within the final extended period. On 28
August 2002, petitioner filed a Motion to Admit and a Motion to Dismiss the complaint on Petitioner elevated the 21 October 2002 and 21 January 2003 Orders of the RTC to the
the ground, among other things, that the RTC has no jurisdiction over the cause of action Court of Appeals on petition for certiorari under Rule 65 of the Rules of Court. On 28
of the case. October 2004, the Court of Appeals promulgated the assailed Decision, the dispositive
portion thereof reads:
On 21 October 2002, public respondent Judge Guillermo G. Purganan, acting as presiding
judge of the RTC, Branch 42, Manila, issued the assailed Omnibus Order denying the WHEREFORE, the petition is DENIED DUE COURSE and dismissed for lack of merit. 5
Motion to Dismiss of the petitioner and the Motion to Declare Defendant in Default of the
private respondent. Pertinent portions of the Omnibus Order and the dispositive portion On 22 November 2004, petitioner moved for reconsideration, which was denied by the
thereof read: Court of Appeals on 26 January 2005. Hence, this present petition.

In his opposition to the motion to declare him in default and his Motion to Admit Petitioner claims that actions for damages based on quasi-delict are actions that are
defendant IÑEGO alleged that he never received the Order dated 12 August 2002. But capable of pecuniary estimation; hence, the jurisdiction in such cases falls upon either the
believing in good faith, without being presumptuous, that his 3rd Motion for additional municipal courts (the Municipal Trial Courts, Metropolitan Trial Courts, Municipal Trial
Time to file or any appropriate [pleading] would be granted, he filed the aforesaid Motion Courts In Cities, And Municipal Circuit Trial Courts), or the Regional Trial Courts,
received by the Court on 23 August 2002. depending on the value of the damages claimed.

Petitioner argues further that should this Court find actions for damages capable of
pecuniary estimation, then the total amount of damages claimed by the private

Page 31 of 100
respondent must exceed P400,000.00 in order that it may fall under the jurisdiction of the must be a resulting damage to a third person. The relief available to the offended party in
RTC. Petitioner asserts, however, that the moral and exemplary damages claimed by such cases is for the reparation, restitution, or payment of such damage, without which
private respondent be excluded from the computation of the total amount of damages for any alleged offended party has no cause of action or relief. The fault or negligence of the
jurisdictional purposes because the said moral and exemplary damages arose, not from defendant, therefore, is inextricably intertwined with the claim for damages, and there
the quasi-delict, but from the petitioner’s refusal to pay the actual damages. can be no action based on quasi-delict without a claim for damages.

I We therefore rule that the subject matter of actions for damages based on quasi-delict is
capable of pecuniary estimation.
Actions for damages based on quasi-delicts are primarily and effectively actions for the
recovery of a sum of money for the damages suffered because of the defendant’s alleged II
tortious acts, and are therefore capable of pecuniary estimation.
The amount of damages claimed is within the jurisdiction of the RTC, since it is the claim
In a recent case,6 we did affirm the jurisdiction of a Municipal Circuit Trial Court in actions for all kinds of damages that is the basis of determining the jurisdiction of courts, whether
for damages based on quasi-delict, although the ground used to challenge said the claims for damages arise from the same or from different causes of action.
jurisdiction was an alleged forum shopping, and not the applicability of Section 19(1) of
Batas Pambansa Blg. 129. Despite our concurrence in petitioner’s claim that actions for damages based on quasi-
delict are actions that are capable of pecuniary estimation, we find that the total amount
According to respondent Judge, what he referred to in his assailed Order as not capable of of damages claimed by the private respondent nevertheless still exceeds the jurisdictional
pecuniary estimation is the cause of action, which is a quasi-delict, and not the amount of limit of P400,000.00 and remains under the jurisdiction of the RTC.
damage prayed for.7 From this, respondent Judge concluded that since fault or negligence
in quasi-delicts cannot be the subject of pecuniary estimation, the RTC has jurisdiction. Petitioner argues that in actions for damages based on quasi-delict, claims for damages
The Court of Appeals affirmed respondent Judge in this respect.8 arising from a different cause of action (i.e., other than the fault or negligence of the
defendant) should not be included in the computation of the jurisdictional amount.
Respondent Judge’s observation is erroneous. It is crystal clear from B.P. Blg. 129, as According to petitioner, the moral and exemplary damages claimed by the respondents in
amended by Republic Act No. 7691, that what must be determined to be capable or the case at bar are not direct and proximate consequences of the alleged negligent act.
incapable of pecuniary estimation is not the cause of action, but the subject matter of the Petitioner points out that the complaint itself stated that such moral and exemplary
action.9 A cause of action is "the delict or wrongful act or omission committed by the damages arose from the alleged refusal of defendants to honor the demand for damages,
defendant in violation of the primary rights of the plaintiff." 10 On the other hand, the and therefore there is no reasonable cause and effect between the fault or negligence of
"subject matter of the action" is "the physical facts, the thing real or personal, the money, the defendant and the claim for moral and exemplary damages. 14 If the claims for moral
lands, chattels, and the like, in relation to which the suit is prosecuted, and not the delict and exemplary damages are not included in the computation for purposes of determining
or wrong committed by the defendant."11 jurisdiction, only the claim for actual damages in the amount of P40,000.00 will be
considered, and the MeTC will have jurisdiction.
The case of Lapitan v. Scandia, Inc., et al., 12 has guided this Court time and again in
determining whether the subject matter of the action is capable of pecuniary estimation. We cannot give credence to petitioner’s arguments. The distinction he made between
In Lapitan, the Court spoke through the eminent Mr. Justice Jose B.L. Reyes: damages arising directly from injuries in a quasi-delict and those arising from a refusal to
admit liability for a quasi-delict is more apparent than real, as the damages sought by
In determining whether an action is one the subject matter of which is not capable of respondent originate from the same cause of action: the quasi-delict. The fault or
pecuniary estimation this Court has adopted the criterion of first ascertaining the nature negligence of the employee and the juris tantum presumption of negligence of his
of the principal action or remedy sought. If it is primarily for the recovery of a sum of employer in his selection and supervision are the seeds of the damages claimed, without
money, the claim is considered capable of pecuniary estimation, and whether jurisdiction distinction.
is in the municipal courts or in the courts of first instance [now Regional Trial Courts]
would depend on the amount of the claim. However, where the basic issue is something Even assuming, for the sake of argument, that the claims for moral and exemplary
other than the right to recover a sum of money, where the money claim is purely damages arose from a cause of action other than the quasi-delict, their inclusion in the
incidental to, or a consequence of, the principal relief sought like suits to have the computation of damages for jurisdictional purposes is still proper. All claims for damages
defendant perform his part of the contract (specific performance) and in actions for should be considered in determining the jurisdiction of the court regardless of whether
support, or for annulment of a judgment or to foreclose a mortgage, this court has they arose from a single cause of action or several causes of action. Rule 2, Section 5, of
considered such actions as cases where the subject of the litigation may not be estimated the Rules of Court allows a party to assert as many causes of action as he may have
in terms of money, and are cognizable exclusively by courts of first instance [now against the opposing party. Subsection (d) of said section provides that where the claims
Regional Trial Courts]. x x x.13 (Emphasis supplied.) in all such joined causes of action are principally for recovery of money, the aggregate
amount claimed shall be the test of jurisdiction. 15
Actions for damages based on quasi-delicts are primarily and effectively actions for the
recovery of a sum of money for the damages suffered because of the defendant’s alleged Hence, whether or not the different claims for damages are based on a single cause of
tortious acts. The damages claimed in such actions represent the monetary equivalent of action or different causes of action, it is the total amount thereof which shall govern.
the injury caused to the plaintiff by the defendant, which are thus sought to be recovered Jurisdiction in the case at bar remains with the RTC, considering that the total amount
by the plaintiff. This money claim is the principal relief sought, and is not merely claimed, inclusive of the moral and exemplary damages claimed, is P490,000.00.
incidental thereto or a consequence thereof. It bears to point out that the complaint filed
by private respondent before the RTC actually bears the caption "for DAMAGES." In sum, actions for damages based on quasi-delicts are actions that are capable of
pecuniary estimation. As such, they fall within the jurisdiction of either the RTC or the
Fault or negligence, which the Court of Appeals claims is not capable of pecuniary municipal courts, depending on the amount of damages claimed. In this case, the amount
estimation, is not actionable by itself. For such fault or negligence to be actionable, there of damages claimed is within the jurisdiction of the RTC, since it is the claim for all kinds

Page 32 of 100
of damages that is the basis of determining the jurisdiction of courts, whether the claims
for damages arise from the same or from different causes of action.

WHEREFORE, the petition for review on certiorari is hereby DENIED for lack of merit. The
Decision and Resolution of the Court of Appeals dated 28 October 2004 and 26 January
2005, respectively, are AFFIRMED insofar as they held that the Regional Trial Court has
jurisdiction. No costs.

SO ORDERED.

Page 33 of 100
Raymundi 1. Hospital and Burial Expenses ₱80,926.25

SECOND DIVISION 2. Loss of earning capacity ₱77,000.00

G.R. No. 164012              June 8, 2007 3. Moral Damages ₱20,000.00

FLORDELIZA MENDOZA, petitioner, vs. 4. Indemnity for the death of Sonny Soriano ₱50,000.00
MUTYA SORIANO and Minor JULIE ANN SORIANO duly represented by her
natural mother and guardian ad litem MUTYA SORIANO, respondents. Actual payment of the aforementioned amounts should, however, be reduced by twenty
(20%) per cent due to the presence of contributory negligence by the victim as provided
DECISION for in Article 2179 of the Civil Code.

QUISUMBING, J.: SO ORDERED.7

In this petition for review under Rule 45 of the Rules of Court, petitioner asks this Court While the appellate court agreed that Soriano was negligent, it also found Macasasa
to reverse and set aside the Decision 1 dated November 17, 2003 and the negligent for speeding, such that he was unable to avoid hitting the victim. It observed
Resolution2 dated May 24, 2004 of the Court of Appeals in CA-G.R. CV No. 69037. The that Soriano’s own negligence did not preclude recovery of damages from Macasasa’s
appellate court found petitioner, as employer of Lomer Macasasa, liable for damages. negligence. It further held that since petitioner failed to present evidence to the contrary,
and conformably with Article 2180 8 of the Civil Code, the presumption of negligence of the
The facts are as follows: employer in the selection and supervision of employees stood.

At around 1:00 a.m., July 14, 1997, Sonny Soriano, while crossing Commonwealth Petitioner’s motion for reconsideration was denied by the appellate court in a
Avenue near Luzon Avenue in Quezon City, was hit by a speeding Tamaraw FX driven by Resolution9 dated May 24, 2004.
Lomer Macasasa. Soriano was thrown five meters away, while the vehicle only stopped
some 25 meters from the point of impact. Gerard Villaspin, one of Soriano’s companions, Hence, this appeal where petitioner alleges that:
asked Macasasa to bring Soriano to the hospital, but after checking out the scene of the
incident, Macasasa returned to the FX, only to flee. A school bus brought Soriano to East I.
Avenue Medical Center where he later died. Subsequently, the Quezon City Prosecutor
recommended the filing of a criminal case for reckless imprudence resulting to homicide THE TOTAL AMOUNT PRAYED FOR IN THE COMPLAINT IS NOT WITHIN THE
against Macasasa.3 JURISDICTION OF THE REGIONAL TRIAL COURT.

On August 20, 1997, respondents Mutya Soriano and Julie Ann Soriano, Soriano’s wife II.
and daughter, respectively, filed a complaint for damages against Macasasa and
[COROLLARILY], THE AWARD OF DAMAGES IN FAVOR OF THE RESPONDENTS [HAS] NO
petitioner Flordeliza Mendoza, the registered owner of the vehicle. The complaint was
BASIS IN LAW.10
docketed as Civil Case No. C-18038 in the Regional Trial Court of Caloocan City, Branch
121. Respondents prayed that Macasasa and petitioner be ordered to pay them:
The issues are simple: (1) Did the Regional Trial Court have jurisdiction to try the case?
₱200,000 moral damages; ₱500,000 for lost income; ₱22,250 for funeral services;
and (2) Was there sufficient legal basis to award damages?
₱45,000 for burial lot; ₱15,150 for interment and lapida; ₱8,066 for hospitalization, other
medical and transportation expenses; ₱28,540 for food and drinks during the wake; Petitioner argues that the amount claimed by respondents is within the jurisdiction of the
₱50,000 exemplary damages; ₱60,000 indemnity for Soriano’s death; and ₱25,000 for Metropolitan Trial Court. She posits that to determine the jurisdictional amount, what
attorney’s fees plus ₱500 per court appearance.4 should only be considered are the following: ₱22,250 for funeral services; ₱45,000 for
burial lot; ₱15,150 for interment and lapida; ₱8,066 for hospitalization and
In her answer, petitioner Mendoza maintained that she was not liable since as owner of
transportation; ₱28,540 for food and drinks during the wake; and ₱60,000 indemnity for
the vehicle, she had exercised the diligence of a good father of a family over her
Soriano’s death. She maintains that the sum of these amounts, ₱179,006, is below the
employee, Macasasa.
jurisdictional amount of the Regional Trial Court. She states that under Section 19(8) of
the Judiciary Reorganization Act of 1980, the following claims of respondents must be
Upon respondents’ motion, the complaint for damages against Macasasa was dismissed.
excluded: ₱200,000 moral damages, ₱500,000 for lost income; ₱50,000 exemplary
After trial, the trial court also dismissed the complaint against petitioner. 5 It found damages; ₱25,000 attorney’s fees plus ₱500 per court appearance. Petitioner thus prays
Soriano negligent for crossing Commonwealth Avenue by using a small gap in the island’s that the decision of the Court of Appeals be reversed, and the dismissal of the case by the
fencing rather than the pedestrian overpass. The lower court also ruled that petitioner trial court be affirmed on the ground of lack of jurisdiction.
was not negligent in the selection and supervision of Macasasa since complainants
Section 19(8) of Batas Pambansa Blg. 129, 11 as amended by Republic Act No. 7691,
presented no evidence to support their allegation of petitioner’s negligence. 6
states the pertinent law.
Respondents appealed. The Court of Appeals reversed the trial court. The dispositive
SEC. 19. Jurisdiction in civil cases.–Regional Trial Courts shall exercise exclusive original
portion of the appellate court’s decision reads:
jurisdiction:
WHEREFORE, the judgment appealed from is REVERSED, and another one is hereby
xxxx
rendered ordering [petitioner] Flordeliza Mendoza to pay [respondents] Mutya Soriano
and Julie Ann Soriano the following amounts:

Page 34 of 100
(8) In all other cases in which the demand, exclusive of interest, damages of whatever In this case, we hold petitioner primarily and solidarily liable for the damages caused by
kind, attorney's fees, litigation expenses, and costs or the value of the property in Macasasa.23 Respondents could recover directly from petitioner 24 since petitioner failed to
controversy exceeds One hundred thousand pesos (₱100,000.00) or, in such other cases prove that she exercised the diligence of a good father of a family in supervising
in Metro Manila, where the demand, exclusive of the abovementioned items exceeds Two Macasasa.25 Indeed, it is unfortunate that petitioner harbored the notion that the Regional
hundred thousand pesos (₱200,000.00). Trial Court did not have jurisdiction over the case and opted not to present her evidence
on this point.
But relatedly, Administrative Circular No. 09-9412 expressly states:
Lastly, we agree that the Court of Appeals did not err in ruling that Soriano was guilty of
xxxx contributory negligence for not using the pedestrian overpass while crossing
Commonwealth Avenue. We even note that the respondents now admit this point, and
2. The exclusion of the term "damages of whatever kind" in determining the jurisdictional concede that the appellate court had properly reduced by 20% the amount of damages it
amount under Section 19(8) and Section 33(1) of BP Blg. 129, as amended by RA No. awarded. Hence, we affirm the reduction26 of the amount earlier awarded, based on
7691, applies to cases where the damages are merely incidental to or a consequence of Article 2179 of the Civil Code which reads:
the main cause of action. However, in cases where the claim for damages is the main
cause of action, or one of the causes of action, the amount of such claim shall be When the plaintiff's own negligence was the immediate and proximate cause of his injury,
considered in determining the jurisdiction of the court. (Underscoring supplied.) he cannot recover damages. But if his negligence was only contributory, the immediate
and proximate cause of the injury being the defendant's lack of due care, the plaintiff
Actions for damages based on quasi-delicts, as in this case, are primarily and effectively may recover damages, but the courts shall mitigate the damages to be awarded.
actions for the recovery of a sum of money for the damages for tortious acts. 13 In this
case, respondents’ claim of ₱929,006 in damages and ₱25,000 attorney’s fees plus ₱500 WHEREFORE, we DENY the petition for lack of merit and hereby AFFIRM the Decision
per court appearance represents the monetary equivalent for compensation of the alleged dated November 17, 2003 and the Resolution dated May 24, 2004 of the Court of Appeals
injury. These money claims are the principal reliefs sought by respondents in their in CA-G.R. CV No. 69037.
complaint for damages.14 Consequently then, we hold that the Regional Trial Court of
Caloocan City possessed and properly exercised jurisdiction over the case. 15 Costs against petitioner.

Petitioner further argues that since respondents caused the dismissal of the complaint SO ORDERED.
against Macasasa, there is no longer any basis to find her liable. She claims that "no iota
of evidence" was presented in this case to prove Macasasa’s negligence, and besides,
respondents can recover damages in the criminal case against him.

Respondents counter that as Macasasa’s employer, petitioner was presumed negligent in

selecting and supervising Macasasa after he was found negligent by the Court of Appeals.

The records show that Macasasa violated two traffic rules under the Land Transportation
and Traffic Code. First, he failed to maintain a safe speed to avoid endangering
lives.16 Both the trial and the appellate courts found Macasasa overspeeding. 17 The
records show also that Soriano was thrown five meters away after he was hit. 18 Moreover,
the vehicle stopped only some 25 meters from the point of impact.19

Both circumstances support the conclusion that the FX vehicle driven by Macasasa was
overspeeding. Second, Macasasa, the vehicle driver, did not aid Soriano, the accident
victim, in violation of Section 55, 20 Article V of the Land Transportation and Traffic Code.
While Macasasa at first agreed to bring Soriano to the hospital, he fled the scene in a
hurry. Contrary to petitioner’s claim, there is no showing of any factual basis that
Macasasa fled for fear of the people’s wrath. What remains undisputed is that he did not
report the accident to a police officer, nor did he summon a doctor. Under Article
218521 of the Civil Code, a person driving a motor vehicle is presumed negligent if at the
time of the mishap, he was violating traffic regulations.

While respondents could recover damages from Macasasa in a criminal case and
petitioner could become subsidiarily liable, still petitioner, as owner and employer, is
directly and separately civilly liable for her failure to exercise due diligence in supervising
Macasasa.22 We must emphasize that this damage suit is for the quasi-delict of petitioner,
as owner and employer, and not for the delict of Macasasa, as driver and employee.

Under Article 2180 of the Civil Code, employers are liable for the damages caused by their
employees acting within the scope of their assigned tasks. The liability arises due to the
presumed negligence of the employers in supervising their employees unless they prove
that they observed all the diligence of a good father of a family to prevent the damage.

Page 35 of 100
 FIRST DIVISION amount of moral damages from ₱300,000.00 to ₱1,000,000.00. The case was raffled to
the Seventeenth Division of the Court of Appeals.
G.R. No. 173915               February 22, 2010
On January 23, 2006, the Court of Appeals, Seventh Division, promulgated a decision in
IRENE SANTE AND REYNALDO SANTE, Petitioners, vs. CA-G.R. SP No. 85465, as follows:
HON. EDILBERTO T. CLARAVALL, in his capacity as Presiding Judge of Branch 60,
Regional Trial Court of Baguio City, and VITA N. KALASHIAN, Respondents. WHEREFORE, finding grave abuse of discretion on the part of [the] Regional Trial Court of
Baguio, Branch 60, in rendering the assailed Orders dated June 24, 2004 and July [19],
DECISION 2004 in Civil Case No. 5794-R the instant petition for certiorari is GRANTED. The assailed
Orders are hereby ANNULLED and SET ASIDE. Civil Case No. 5794-R for damages is
VILLARAMA, JR., J.: ordered DISMISSED for lack of jurisdiction.
Before this Court is a petition for certiorari 1 under Rule 65 of the 1997 Rules of Civil SO ORDERED.14
Procedure, as amended, filed by petitioners Irene and Reynaldo Sante assailing the
Decision2 dated January 31, 2006 and the Resolution3 dated June 23, 2006 of the The Court of Appeals held that the case clearly falls under the jurisdiction of the MTCC as
Seventeenth Division of the Court of Appeals in CA-G.R. SP No. 87563. The assailed the allegations show that plaintiff was seeking to recover moral damages in the amount of
decision affirmed the orders of the Regional Trial Court (RTC) of Baguio City, Branch 60, ₱300,000.00, which amount was well within the jurisdictional amount of the MTCC. The
denying their motion to dismiss the complaint for damages filed by respondent Vita Court of Appeals added that the totality of claim rule used for determining which court
Kalashian against them. had jurisdiction could not be applied to the instant case because plaintiff’s claim for
exemplary damages was not a separate and distinct cause of action from her claim of
The facts, culled from the records, are as follows: moral damages, but merely incidental to it. Thus, the prayer for exemplary damages
should be excluded in computing the total amount of the claim.
On April 5, 2004, respondent filed before the RTC of Baguio City a complaint for
damages4 against petitioners. In her complaint, docketed as Civil Case No. 5794-R, On January 31, 2006, the Court of Appeals, this time in CA-G.R. SP No. 87563, rendered
respondent alleged that while she was inside the Police Station of Natividad, Pangasinan, a decision affirming the September 17, 2004 Order of the RTC denying petitioners’ Motion
and in the presence of other persons and police officers, petitioner Irene Sante uttered to Dismiss Ad Cautelam. In the said decision, the appellate court held that the total or
words, which when translated in English are as follows, "How many rounds of sex did you aggregate amount demanded in the complaint constitutes the basis of jurisdiction. The
have last night with your boss, Bert? You fuckin’ bitch!" Bert refers to Albert Gacusan, Court of Appeals did not find merit in petitioners’ posture that the claims for exemplary
respondent’s friend and one (1) of her hired personal security guards detained at the said damages and attorney’s fees are merely incidental to the main cause and should not be
station and who is a suspect in the killing of petitioners’ close relative. Petitioners also included in the computation of the total claim.
allegedly went around Natividad, Pangasinan telling people that she is protecting and
cuddling the suspects in the aforesaid killing. Thus, respondent prayed that petitioners be The Court of Appeals additionally ruled that respondent can amend her complaint by
held liable to pay moral damages in the amount of ₱300,000.00; ₱50,000.00 as increasing the amount of moral damages from ₱300,000.00 to ₱1,000,000.00, on the
exemplary damages; ₱50,000.00 attorney’s fees; ₱20,000.00 litigation expenses; and ground that the trial court has jurisdiction over the original complaint and respondent is
costs of suit. entitled to amend her complaint as a matter of right under the Rules.

Petitioners filed a Motion to Dismiss5 on the ground that it was the Municipal Trial Court in Unable to accept the decision, petitioners are now before us raising the following issues:
Cities (MTCC) and not the RTC of Baguio, that had jurisdiction over the case. They argued
that the amount of the claim for moral damages was not more than the jurisdictional I.
amount of ₱300,000.00, because the claim for exemplary damages should be excluded in
computing the total claim. WHETHER OR NOT THERE WAS GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR
IN EXCESS OF JURISDICTION ON THE PART OF THE (FORMER) SEVENTEENTH DIVISION
On June 24, 2004,6 the trial court denied the motion to dismiss citing our ruling OF THE HONORABLE COURT OF APPEALS WHEN IT RESOLVED THAT THE REGIONAL
in Movers-Baseco Integrated Port Services, Inc. v. Cyborg Leasing Corporation.7 The trial TRIAL COURT OF BAGUIO CITY BRANCH 60 HAS JURISDICTION OVER THE SUBJECT
court held that the total claim of respondent amounted to ₱420,000.00 which was above MATTER OF THE CASE FOR DAMAGES AMOUNTING TO ₱300,000.00;
the jurisdictional amount for MTCCs outside Metro Manila. The trial court also later issued
Orders on July 7, 2004 8 and July 19, 2004, 9 respectively reiterating its denial of the II.
motion to dismiss and denying petitioners’ motion for reconsideration.
WHETHER OR NOT THERE WAS GRAVE ABUSE OF DISCRETION ON THE PART OF THE
Aggrieved, petitioners filed on August 2, 2004, a Petition for Certiorari and HONORABLE RESPONDENT JUDGE OF THE REGIONAL TRIAL COURT OF BAGUIO BRANCH
Prohibition,10 docketed as CA-G.R. SP No. 85465, before the Court of Appeals. 60 FOR ALLOWING THE COMPLAINANT TO AMEND THE COMPLAINT (INCREASING THE
Meanwhile, on July 14, 2004, respondent and her husband filed an Amended AMOUNT OF DAMAGES TO 1,000,000.00 TO CONFER JURISDICTION OVER THE SUBJECT
Complaint11 increasing the claim for moral damages from ₱300,000.00 to ₱1,000,000.00. MATTER OF THE CASE DESPITE THE PENDENCY OF A PETITION FOR CERTIORARI FILED
Petitioners filed a Motion to Dismiss with Answer Ad Cautelam and Counterclaim, but the AT THE COURT OF APPEALS, SEVENTH DIVISION, DOCKETED AS CA G.R. NO. 85465.15
trial court denied their motion in an Order12 dated September 17, 2004.
In essence, the basic issues for our resolution are:
Hence, petitioners again filed a Petition for Certiorari and Prohibition 13 before the Court of
Appeals, docketed as CA-G.R. SP No. 87563, claiming that the trial court committed 1) Did the RTC acquire jurisdiction over the case? and
grave abuse of discretion in allowing the amendment of the complaint to increase the
2) Did the RTC commit grave abuse of discretion in allowing the amendment of
the complaint?

Page 36 of 100
Petitioners insist that the complaint falls under the exclusive jurisdiction of the MTCC. 2. The exclusion of the term "damages of whatever kind" in determining the jurisdictional
They maintain that the claim for moral damages, in the amount of ₱300,000.00 in the amount under Section 19 (8) and Section 33 (1) of B.P. Blg. 129, as amended by R.A. No.
original complaint, is the main action. The exemplary damages being discretionary should 7691, applies to cases where the damages are merely incidental to or a consequence of
not be included in the computation of the jurisdictional amount. And having no the main cause of action. However, in cases where the claim for damages is the main
jurisdiction over the subject matter of the case, the RTC acted with grave abuse of cause of action, or one of the causes of action, the amount of such claim shall be
discretion when it allowed the amendment of the complaint to increase the claim for considered in determining the jurisdiction of the court. (Emphasis ours.)
moral damages in order to confer jurisdiction.
In the instant case, the complaint filed in Civil Case No. 5794-R is for the recovery of
In her Comment,16 respondent averred that the nature of her complaint is for recovery of damages for the alleged malicious acts of petitioners. The complaint principally sought an
damages. As such, the totality of the claim for damages, including the exemplary award of moral and exemplary damages, as well as attorney’s fees and litigation
damages as well as the other damages alleged and prayed in the complaint, such as expenses, for the alleged shame and injury suffered by respondent by reason of
attorney’s fees and litigation expenses, should be included in determining jurisdiction. The petitioners’ utterance while they were at a police station in Pangasinan. It is settled that
total claim being ₱420,000.00, the RTC has jurisdiction over the complaint. jurisdiction is conferred by law based on the facts alleged in the complaint  since the latter
comprises a concise statement of the ultimate facts constituting the plaintiff’s causes of
We deny the petition, which although denominated as a petition for certiorari, we treat as action.20 It is clear, based on the allegations of the complaint, that respondent’s main
a petition for review on certiorari under Rule 45 in view of the issues raised. action is for damages. Hence, the other forms of damages being claimed by
respondent, e.g., exemplary damages, attorney’s fees and litigation expenses, are not
Section 19(8) of Batas Pambansa Blg. 129, 17 as amended by Republic Act No. merely incidental to or consequences of the main action but constitute the primary relief
7691,18 states: prayed for in the complaint.1avvphi1
SEC. 19. Jurisdiction in civil cases. – Regional Trial Courts shall exercise exclusive original In Mendoza v. Soriano,21 it was held that in cases where the claim for damages is the
jurisdiction: main cause of action, or one of the causes of action, the amount of such claim shall be
considered in determining the jurisdiction of the court. In the said case, the respondent’s
xxxx claim of ₱929,000.06 in damages and ₱25,000 attorney’s fees plus ₱500 per court
appearance was held to represent the monetary equivalent for compensation of the
(8) In all other cases in which the demand, exclusive of interest, damages of whatever
alleged injury. The Court therein held that the total amount of monetary claims including
kind, attorney’s fees, litigation expenses, and costs or the value of the property in
the claims for damages was the basis to determine the jurisdictional amount.
controversy exceeds One hundred thousand pesos (₱100,000.00) or, in such other cases
in Metro Manila, where the demand, exclusive of the abovementioned items exceeds Two Also, in Iniego v. Purganan,22  the Court has held:
hundred thousand pesos (₱200,000.00).
The amount of damages claimed is within the jurisdiction of the RTC, since it is the claim
Section 5 of Rep. Act No. 7691 further provides: for all kinds of damages that is the basis of determining the jurisdiction of courts, whether
the claims for damages arise from the same or from different causes of action.
SEC. 5. After five (5) years from the effectivity of this Act, the jurisdictional amounts
mentioned in Sec. 19(3), (4), and (8); and Sec. 33(1) of Batas Pambansa Blg. 129 as xxxx
amended by this Act, shall be adjusted to Two hundred thousand pesos (₱200,000.00).
Five (5) years thereafter, such jurisdictional amounts shall be adjusted further to Three Considering that the total amount of damages claimed was ₱420,000.00, the Court of
hundred thousand pesos (₱300,000.00): Provided, however, That in the case of Metro Appeals was correct in ruling that the RTC had jurisdiction over the case.
Manila, the abovementioned jurisdictional amounts shall be adjusted after five (5) years
from the effectivity of this Act to Four hundred thousand pesos (₱400,000.00). Lastly, we find no error, much less grave abuse of discretion, on the part of the Court of
Appeals in affirming the RTC’s order allowing the amendment of the original complaint
Relatedly, Supreme Court Circular No. 21-99 was issued declaring that the first from ₱300,000.00 to ₱1,000,000.00 despite the pendency of a petition for certiorari filed
adjustment in jurisdictional amount of first level courts outside of Metro Manila from before the Court of Appeals. While it is a basic jurisprudential principle that an
₱100,000.00 to ₱200,000.00 took effect on March 20, 1999. Meanwhile, the second amendment cannot be allowed when the court has no jurisdiction over the original
adjustment from ₱200,000.00 to ₱300,000.00 became effective on February 22, 2004 in complaint and the purpose of the amendment is to confer jurisdiction on the court, 23 here,
accordance with OCA Circular No. 65-2004 issued by the Office of the Court Administrator the RTC clearly had jurisdiction over the original complaint and amendment of the
on May 13, 2004. complaint was then still a matter of right.24
Based on the foregoing, there is no question that at the time of the filing of the complaint WHEREFORE, the petition is DENIED, for lack of merit. The Decision and Resolution of the
on April 5, 2004, the MTCC’s jurisdictional amount has been adjusted to ₱300,000.00. Court of Appeals dated January 31, 2006 and June 23, 2006, respectively, are AFFIRMED.
The Regional Trial Court of Baguio City, Branch 60 is DIRECTED to continue with the trial
But where damages is the main cause of action, should the amount of moral damages proceedings in Civil Case No. 5794-R with deliberate dispatch.
prayed for in the complaint be the sole basis for determining which court has jurisdiction
or should the total amount of all the damages claimed regardless of kind and nature, such No costs.
as exemplary damages, nominal damages, and attorney’s fees, etc., be used?
SO ORDERED.
In this regard, Administrative Circular No. 09-9419 is instructive:

xxxx

Page 37 of 100
 I. That the Honorable Court a quo erred in issuing its order dated November 2,
1957, by holding the incident as submitted for resolution, without a summary
EN BANC hearing and compliance with the other mandatory requirements provided for in
Section 17, Rule 59 of the Rules of Court.
G.R. No. L-21450             April 15, 1968
II. That the Honorable Court a quo erred in ordering the issuance of execution
SERAFIN TIJAM, ET AL., plaintiffs-appellees, vs. against the herein bonding company-appellant.
MAGDALENO SIBONGHANOY alias GAVINO SIBONGHANOY and LUCIA
BAGUIO, defendants, III. That the Honorable Court a quo erred in denying the motion to quash the
MANILA SURETY AND FIDELITY CO., INC. (CEBU BRANCH) bonding company and writ of execution filed by the herein bonding company-appellant as well as its
defendant-appellant. subsequent motion for reconsideration, and/or in not quashing or setting aside
the writ of execution.
F. S. Urot and G. A. Uriate for plaintiffs-appellees.
Carlos J. Cuizon for defendants Gavino Sibonghanoy and Lucia Baguio. Not one of the assignment of errors — it is obvious — raises the question of lack of
Villaluz Law Office, Velasco Law Office, Pages and Soberano for defendant-appellant jurisdiction, neither directly nor indirectly.
Manila Surety and Fidelity Company, Inc.
Although the appellees failed to file their brief, the Court of Appeals, on December 11,
DIZON, J.: 1962, decided the case affirming the orders appealed from.

On July 19, 1948 — barely one month after the effectivity of Republic Act No. 296 known On January 8, 1963 — five days after the Surety received notice of the decision, it filed a
as the Judiciary Act of 1948 — the spouses Serafin Tijam and Felicitas Tagalog motion asking for extension of time within which to file a motion for reconsideration. The
commenced Civil Case No. R-660 in the Court of First Instance of Cebu against the Court of Appeals granted the motion in its resolution of January 10 of the same year. Two
spouses Magdaleno Sibonghanoy and Lucia Baguio to recover from them the sum of days later the Surety filed a pleading entitled MOTION TO DISMISS, alleging substantially
P1,908.00, with legal interest thereon from the date of the filing of the complaint until the that appellees action was filed in the Court of First Instance of Cebu on July 19, 1948 for
whole obligation is paid, plus costs. As prayed for in the complaint, a writ of attachment the recovery of the sum of P1,908.00 only; that a month before that date Republic Act
was issued by the court against defendants' properties, but the same was soon dissolved No. 296, otherwise known as the Judiciary Act of 1948, had already become effective,
upon the filing of a counter-bond by defendants and the Manila Surety and Fidelity Co., Section 88 of which placed within the original exclusive jurisdiction of inferior courts all
Inc. hereinafter referred to as the Surety, on the 31st of the same month. civil actions where the value of the subject-matter or the amount of the demand does not
exceed P2,000.00, exclusive of interest and costs; that the Court of First Instance
After being duly served with summons the defendants filed their answer in which, after therefore had no jurisdiction to try and decide the case. Upon these premises the Surety's
making some admissions and denials of the material averments of the complaint, they motion prayed the Court of Appeals to set aside its decision and to dismiss the case. By
interposed a counterclaim. This counterclaim was answered by the plaintiffs. resolution of January 16, 1963 the Court of Appeals required the appellees to answer the
motion to dismiss, but they failed to do so. Whereupon, on May 20 of the same year, the
After trial upon the issues thus joined, the Court rendered judgment in favor of the Court resolved to set aside its decision and to certify the case to Us. The pertinent
plaintiffs and, after the same had become final and executory, upon motion of the latter, portions of its resolution read as follows:
the Court issued a writ of execution against the defendants. The writ having been
returned unsatisfied, the plaintiffs moved for the issuance of a writ of execution against It would indeed appear from the record that the action at bar, which is a suit for
the Surety's bond (Rec. on Appeal, pp. 46-49), against which the Surety filed a written collection of money in the sum of exactly P1,908.00 exclusive of interest, was
opposition (Id. pp. 49) upon two grounds, namely, (1) Failure to prosecute and (2) originally instituted in the Court of First Instance of Cebu on July 19, 1948. But
Absence of a demand upon the Surety for the payment of the amount due under the about a month prior to the filing of the complaint, more specifically on June 17,
judgment. Upon these grounds the Surety prayed the Court not only to deny the motion 1948, the Judiciary Act of 1948 took effect, depriving the Court of First Instance
for execution against its counter-bond but also the following affirmative relief  : "to relieve of original jurisdiction over cases in which the demand, exclusive of interest, is
the herein bonding company of its liability, if any, under the bond in question" ( Id. p. 54) not more than P2,000.00. (Secs. 44[c] and 86[b], R.A. No. 296.)
The Court denied this motion on the ground solely that no previous demand had been
made on the Surety for the satisfaction of the judgment. Thereafter the necessary We believe, therefore, that the point raised in appellant's motion is an important
demand was made, and upon failure of the Surety to satisfy the judgment, the plaintiffs one which merits serious consideration. As stated, the complaint was filed on
filed a second motion for execution against the counterbond. On the date set for the July 19, 1948. This case therefore has been pending now for almost 15 years,
hearing thereon, the Court, upon motion of the Surety's counsel, granted the latter a and throughout the entire proceeding appellant never raised the question of
period of five days within which to answer the motion. Upon its failure to file such answer, jurisdiction until after receipt of this Court's adverse decision.
the Court granted the motion for execution and the corresponding writ was issued.
There are three cases decided by the Honorable Supreme Court which may be
Subsequently, the Surety moved to quash the writ on the ground that the same was worthy of consideration in connection with this case, namely: Tyson Tan, et al.
issued without the required summary hearing provided for in Section 17 of Rule 59 of the vs. Filipinas Compañia de Seguros, et al., G.R. No. L-10096, March 23, 1956;
Rules of Court. As the Court denied the motion, the Surety appealed to the Court of Pindangan Agricultural Co., Inc. vs. Jose P. Dans, etc., et al., G.R. No. L-14591,
Appeals from such order of denial and from the one denying its motion for reconsideration September 26, 1962; and Alfredo Montelibano, et al. vs. Bacolod-Murcia Milling
(Id. p. 97). Its record on appeal was then printed as required by the Rules, and in due Co., Inc., G.R. No. L-15092, September 29, 1962, wherein the Honorable
time it filed its brief raising therein no other question but the ones covered by the Supreme Court frowned upon the 'undesirable practice' of appellants submitting
following assignment of errors: their case for decision and then accepting the judgment, if favorable, but
attacking it for lack of jurisdiction when adverse.

Page 38 of 100
 Considering, however, that the Supreme Court has the "exclusive" appellate It has been held that a party can not invoke the jurisdiction of a court to sure affirmative
jurisdiction over "all cases in which the jurisdiction of any inferior court is in relief against his opponent and, after obtaining or failing to obtain such relief, repudiate
issue" (See. 1, Par. 3[3], Judiciary Act of 1948, as amended), we have no choice or question that same jurisdiction (Dean vs. Dean, 136 Or. 694, 86 A.L.R. 79). In the
but to certify, as we hereby do certify, this case to the Supreme case just cited, by way of explaining the rule, it was further said that the question
Court.1äwphï1.ñët whether the court had jurisdiction either of the subject-matter of the action or of the
parties was not important in such cases because the party is barred from such
ACCORDINGLY, pursuant to Section 31 of the Judiciary Act of 1948 as amended, conduct not because the judgment or order of the court is valid and conclusive as an
let the record of this case be forwarded to the Supreme Court. adjudication, but for the reason that such a practice can not be tolerated — obviously for
reasons of public policy.
It is an undisputed fact that the action commenced by appellees in the Court of First
Instance of Cebu against the Sibonghanoy spouses was for the recovery of the sum of Furthermore, it has also been held that after voluntarily submitting a cause and
P1,908.00 only — an amount within the original exclusive jurisdiction of inferior courts in encountering an adverse decision on the merits, it is too late for the loser to question the
accordance with the provisions of the Judiciary Act of 1948 which had taken effect about jurisdiction or power of the court (Pease vs. Rathbun-Jones etc., 243 U.S. 273, 61 L. Ed.
a month prior to the date when the action was commenced. True also is the rule that 715, 37 S. Ct. 283; St. Louis etc. vs. McBride, 141 U.S. 127, 35 L. Ed. 659). And in
jurisdiction over the subject matter is conferred upon the courts exclusively by law, and Littleton vs. Burgess, 16 Wyo. 58, the Court said that it is not right for a party who has
as the lack of it affects the very authority of the court to take cognizance of the case, the affirmed and invoked the jurisdiction of a court in a particular matter to secure an
objection may be raised at any stage of the proceedings. However, considering the facts affirmative relief, to afterwards deny that same jurisdiction to escape a penalty.
and circumstances of the present case — which shall forthwith be set forth — We are of
the opinion that the Surety is now barred by laches from invoking this plea at this late Upon this same principle is what We said in the three cases mentioned in the resolution of
hour for the purpose of annuling everything done heretofore in the case with its active the Court of Appeals of May 20, 1963 (supra) — to the effect that we frown upon the
participation. "undesirable practice" of a party submitting his case for decision and then accepting the
judgment, only if favorable, and attacking it for lack of jurisdiction, when adverse — as
As already stated, the action was commenced in the Court of First Instance of Cebu on well as in Pindañgan etc. vs. Dans, et al., G.R. L-14591, September 26,
July 19, 1948, that is, almost  fifteen years before  the Surety filed its motion to dismiss 1962; Montelibano, et al., vs. Bacolod-Murcia Milling Co., Inc., G.R. L-15092; Young Men
on January 12, 1963 raising the question of lack of jurisdiction  for the first time. Labor Union etc. vs. The Court of Industrial Relation et al., G.R. L-20307, Feb. 26, 1965,
and Mejia vs. Lucas, 100 Phil. p. 277.
It must be remembered that although the action, originally, was exclusively against the
Sibonghanoy spouses the Surety became a quasi-party therein since July 31, 1948 when The facts of this case show that from the time the Surety became a quasi-party on July
it filed a counter-bond for the dissolution of the writ of attachment issued by the court of 31, 1948, it could have raised the question of the lack of jurisdiction of the Court of First
origin (Record on Appeal, pp. 15-19). Since then, it acquired certain rights and assumed Instance of Cebu to take cognizance of the present action by reason of the sum of money
specific obligations in connection with the pending case, in accordance with sections 12 involved which, according to the law then in force, was within the original exclusive
and 17, Rule 57, Rules of Court (Bautista vs. Joaquin, 46 Phil. 885; Kimpang & Co. vs. jurisdiction of inferior courts. It failed to do so. Instead, at several stages of the
Javier, 65 Phil. 170). proceedings in the court a quo as well as in the Court of Appeals, it invoked the
jurisdiction of said courts to obtain affirmative relief and submitted its case for a final
Upon the filing of the first motion for execution against the counter-bond the Surety not adjudication on the merits. It was only after an adverse decision was rendered by the
only filed a written opposition thereto praying for its denial but also asked for an Court of Appeals that it finally woke up to raise the question of jurisdiction. Were we to
additional affirmative relief  — that it be relieved of its liability under the counter-bond sanction such conduct on its part, We would in effect be declaring as useless all the
upon the grounds relied upon in support of its opposition — lack of jurisdiction of the proceedings had in the present case since it was commenced on July 19, 1948 and
court a quo not being one of them. compel the judgment creditors to go up their Calvary once more. The inequity and
unfairness of this is not only patent but revolting.
Then, at the hearing on the second motion for execution against the counter-bond, the
Surety appeared, through counsel, to ask for time within which to file an answer or Coming now to the merits of the appeal: after going over the entire record, We have
opposition thereto. This motion was granted, but instead of such answer or opposition, become persuaded that We can do nothing better than to quote  in toto, with approval,
the Surety filed the motion to dismiss mentioned heretofore. the decision rendered by the Court of Appeals on December 11, 1962 as follows:
A party may be estopped or barred from raising a question in different ways and for In Civil Case No. R-660 of the Court of First Instance of Cebu, which was a suit
different reasons. Thus we speak of estoppel in pais, or estoppel by deed or by record, for collection of a sum of money, a writ of attachment was issued against
and of estoppel by laches. defendants' properties. The attachment, however, was subsequently discharged
under Section 12 of Rule 59 upon the filing by defendants of a bond subscribed
Laches, in a general sense is failure or neglect, for an unreasonable and unexplained by Manila Surety & Fidelity Co., Inc.
length of time, to do that which, by exercising due diligence, could or should have been
done earlier; it is negligence or omission to assert a right within a reasonable time, After trial, judgment was rendered in favor of plaintiffs.
warranting a presumption that the party entitled to assert it either has abandoned it or
declined to assert it. The writ of execution against defendants having been returned totally
unsatisfied, plaintiffs moved, under Section 17 of Rule 59, for issuance of writ of
The doctrine of laches or of "stale demands" is based upon grounds of public policy which execution against Manila Surety & Fidelity Co., Inc. to enforce the obligation of
requires, for the peace of society, the discouragement of stale claims and, unlike the the bond. But the motion was, upon the surety's opposition, denied on the
statute of limitations, is not a mere question of time but is principally a question of the ground that there was "no showing that a demand had been made, by the
inequity or unfairness of permitting a right or claim to be enforced or asserted. plaintiffs to the bonding company for payment of the amount due under the
judgment" (Record on Appeal, p. 60).

Page 39 of 100
Hence, plaintiffs made the necessary demand upon the surety for satisfaction of Summary hearing is "not intended to be carried on in the formal manner in
the judgment, and upon the latter's failure to pay the amount due, plaintiffs which ordinary actions are prosecuted" (83 C.J.S. 792). It is, rather, a
again filed a motion dated October 31, 1957, for issuance of writ of execution procedure by which a question is resolved "with dispatch, with the least possible
against the surety, with notice of hearing on November 2, 1957. On October 31, delay, and in preference to ordinary legal and regular judicial proceedings"
1957, the surety received copy of said motion and notice of hearing. (Ibid, p. 790). What is essential is that "the defendant is notified or summoned
to appear and is given an opportunity to hear what is urged upon him, and to
It appears that when the motion was called on November 2, 1957, the surety's interpose a defense, after which follows an adjudication of the rights of the
counsel asked that he be given time within which to answer the motion, and so parties" (Ibid., pp. 793-794); and as to the extent and latitude of the hearing,
an order was issued in open court, as follows:1äwphï1.ñët the same will naturally lie upon the discretion of the court, depending upon the
attending circumstances and the nature of the incident up for consideration.
As prayed for, Atty. Jose P. Soberano, Jr., counsel for the Manila
Surety & Fidelity Co., Inc., Cebu Branch, is given until Wednesday, In the case at bar, the surety had been notified of the plaintiffs' motion for
November 6, 1957, to file his answer to the motion for the issuance of execution and of the date when the same would be submitted for consideration.
a writ of execution dated October 30, 1957 of the plaintiffs, after In fact, the surety's counsel was present in court when the motion was called,
which this incident shall be deemed submitted for resolution. and it was upon his request that the court a quo  gave him a period of four days
within which to file an answer. Yet he allowed that period to lapse without filing
SO ORDERED. an answer or objection. The surety cannot now, therefore, complain that it was
deprived of its day in court.
Given in open court, this 2nd day of November, 1957, at Cebu City,
Philippines. It is argued that the surety's counsel did not file an answer to the motion "for
the simple reason that all its defenses can be set up during the hearing of the
(Sgd.) JOSE M. MENDOZA motion even if the same are not reduced to writing" (Appellant's brief, p. 4).
Judge There is obviously no merit in this pretense because, as stated above, the
record will show that when the motion was called, what the surety's counsel did
(Record on Appeal, pp.
was to ask that he be allowed and given time to file an answer. Moreover, it was
64-65, emphasis ours)
stated in the order given in open court upon request of the surety's counsel that
Since the surety's counsel failed to file any answer or objection within the period after the four-day period within which to file an answer, "the incident shall be
given him, the court, on December 7, 1957, issued an order granting plaintiffs' deemed submitted for resolution"; and counsel apparently agreed, as the order
motion for execution against the surety; and on December 12, 1957, the was issued upon his instance and he interposed no objection thereto.
corresponding writ of execution was issued.
It is also urged that although according to Section 17 of Rule 59, supra, there is
On December 24, 1957, the surety filed a motion to quash the writ of execution no need for a separate action, there must, however, be a separate judgment
on the ground that the same was "issued without the requirements of Section against the surety in order to hold it liable on the bond (Appellant's Brief, p. 15).
17, Rule 59 of the Rules of Court having been complied with," more specifically, Not so, in our opinion. A bond filed for discharge of attachment is, per Section
that the same was issued without the required "summary hearing". This motion 12 of Rule 59, "to secure the payment to the plaintiff of any judgment he may
was denied by order of February 10, 1958. recover in the action," and stands "in place of the property so released". Hence,
after the judgment for the plaintiff has become executory and the execution is
On February 25, 1958, the surety filed a motion for reconsideration of the "returned unsatisfied" (Sec. 17, Rule 59), as in this case, the liability of the
above-stated order of denial; which motion was likewise denied by order of bond automatically attaches and, in failure of the surety to satisfy the judgment
March 26, 1958. against the defendant despite demand therefor, writ of execution may issue
against the surety to enforce the obligation of the bond.
From the above-stated orders of February 10, 1958 and March 26, 1958 —
denying the surety's motion to quash the writ of execution and motion for UPON ALL THE FOREGOING, the orders appealed from are hereby affirmed, with costs
reconsideration, respectively — the surety has interposed the appeal on hand. against the appellant Manila Surety and Fidelity Company, Inc.

The surety insists that the lower court should have granted its motion to quash Reyes, Makalintal, Bengzon, J.P., Zaldivar, Sanchez, Castro, Angeles and Fernando, JJ.,
the writ of execution because the same was issued without the summary concur.
hearing required by Section 17 of Rule 59, which reads;

"Sec. 17. When execution returned unsatisfied, recovery had upon

bond. — If the execution be returned unsatisfied in whole or in part,
the surety or sureties on any bond given pursuant to the provisions of
this role to secure the payment of the judgment shall become finally
charged on such bond, and bound to pay to the plaintiff upon demand
the amount due under the judgment, which amount may be recovered
from such surety or sureties after notice and summary hearing in the FIRST DIVISION
same action." (Emphasis ours)
G.R. No. L-34362 November 19, 1982
MODESTA CALIMLIM AND LAMBERTO MAGALI IN HIS CAPACITY AS

Page 40 of 100
ADMINISTRATOR OF THE ESTATE OF DOMINGO MAGALI, petitioners, vs. Named as defendant in said civil case was herein private respondent Francisco Ramos
HON. PEDRO A. RAMIREZ IN HIS CAPACITY AS PRESIDING JUDGE OF THE COURT who claimed to have bought the property from Independent Mercantile Corporation on
OF FIRST INSTANCE OF PANGASINAN, BRANCH I, and FRANCISCO July 25, 1967. Private respondent Francisco Ramos, however, failed to obtain a title over
RAMOS, respondents. the property in his name in view of the existence of an adverse claim annotated on the
title thereof at the instance of the herein petitioners.
Eugenio Ramos for petitioners.
Rogelio P. Closa for respondents. Private respondent Francisco Ramos filed a Motion To Dismiss Civil Case No. SCC-180 on
the ground that the same is barred by prior judgement or by statute of limitations (Rollo.
VASQUEZ, J.: pp. 42-45). Resolving the said Motion, the respondent Court, in its Order dated April 21,
1971, dismissed Civil Case No. SCC- 180 on the ground of estoppel by prior judgment.
The dismissal of Civil Case No. SCC-180 filed by the herein petitioners in the respondent (Ibid., pp, 10-13.) A Motion For Reconsideration filed by the petitioners was denied by the
Court against the private respondent is sought to be annulled and set aside by this respondent Judge in his Order of September 2, 1971. (Ibid., pp. 13-15.) A second Motion
Petition For Review On Certiorari. For Reconsideration was similarly denied in the Order dated September 29, 197 1. (Rollo,
pp. 16-17.) Hence, this Petition.
The antecedent material facts are not disputed. Sometime in 1961, a judgment for a sum
of money was rendered in favor of Independent Mercantile Corporation against a certain We find merit in this appeal.
Manuel Magali by the Municipal Court of Manila in Civil Case No. 85136. After said
judgment became final, a writ of execution was issued on July 31, 1961. The Notice of It is error to consider the dismissal of the petition filed by the herein petitioner in LRC
Levy made on September 21, 1961 on a parcel of land covered by Transfer Certificate of Record No. 39492 for the cancellation of TCT No. 68568 as a bar by prior judgment
Title No. 9138 registered in the name of "Domingo Magali, married to Modesta Calimlim", against the filing of Civil Case No. SCC-180. In order to avail of the defense of  res
specified that the said levy was only against "all rights, title, action, interest and judicata,  it must be shown, among others, that the judgment in the prior action must
participation of the defendant Manuel Magali over the parcel of land described in this title. have been rendered by a court with the proper jurisdiction to take cognizance of the
" The Certificate of Sale executed by the Provincial Sheriff of Pangasinan on October 17, proceeding in which the prior judgment or order was rendered. If there is lack of
1961 in favor of Independent Mercantile Corporation also stated that the sale referred jurisdiction over the subject-matter of the suit or of the parties, the judgment or order
only to the rights and interest of Manuel Magali over the land described in TCT No. 9138. cannot operate as an adjudication of the controversy. (2 Moran Comments on the Rules of
Manuel Magali is one of the several children of Domingo Magali who had died in 1940 and Court, 1970 Edition, p. 364.) This essential element of the defense of bar by prior
herein petitioner Modesta Calimlim. judgment or  res judicata  does not exist in the case presently considered.

However, when the Sheriff issued the final Deed of Sale on January 25, 1963, it was The petition filed by the herein petitioners in LRC Record No. 39492 was an apparent
erroneously stated therein that the sale was with respect to "the parcel of land described invocation of the authority of the respondent Court sitting as a land registration court,
in this title" (referring to TCT No. 9138) and not only over the rights and interest of Although the said petition did not so state, that reliance was apparently placed on Section
Manuel Magali in the same. The execution of the said final Deed of Sale was annotated at 112 of the Land Registration Act. It has been settled by consistent rulings of this Court
the back of said title. that a court of first instance, acting as a land registration court, is a court of limited and
special jurisdiction. As such, its proceedings are not adequate for the litigation of issues
On February 23, 1967, Independent Mercantile Corporation filed a petition in the pertaining to an ordinary civil action, such as, questions involving ownership or title to
respondent Court to compel Manuel Magali to surrender the owner's duplicate of TCT No. real property. (Bareng vs. Shintoist Shrine and Japanese Charity Bureau, 83 SCRA
9138 in order that the same may be cancelled and a new one issued in the name of the 418; Manalo vs. Mariano,  69 SCRA 80; In re: Nicanor T Santos, 102 SCRA 747; Santos
said corporation. Not being the registered owner and the title not being in his possession, vs. Aquino, 101 SCRA 377.) In Hu chon Sunpongco vs. Heirs of Nicolas Ronquillo, L-
Manuel Magali failed to comply with the order of the Court directing him to surrender the 27040, December 19, 1970, 36 SCRA 395, we have held that:
said title. On June 20, 1967, Independent Mercantile Corporation filed an ex-
parte petition to declare TCT No. 9138 as cancelled and to issue a new title in its name. Section 112 of Act 496 confers authority upon the land registration court to
The said petition was granted by the respondent Court and in its Order dated July 13, order the cancellation, alteration or amendment of a certificate of title but
1967, it directed the issuance of a new certificate of title in the name of the Independent withdraws from the Court the power to pass upon any question concerning
Mercantile Corporation and the cancellation of TCT No. 9138. By virtue of said Order, the ownership of the registered property, or any incident where the issues involved
Register of Deeds of Pangasinan issued a new title in the name of the corporation, have become controversial.
Identified as TCT No. 68568.
It may hardly be questioned that the issues raised by the petitioners in their petition to
On November 21, 1967, petitioner Modesta Calimlim, surviving spouse of Domingo cancel TCT No. 68568 refer to the ownership or title over the property covered thereby.
Magali, upon learning that her husband's title over the parcel of land had been cancelled, The said petition presented before the respondent Court in the exercise of its limited
filed a petition with the respondent Court, sitting as a cadastral court, praying for the jurisdiction as a cadastral court, the question of who should be considered the true and
cancellation of TCT No. 68568. An opposition to the said petition was filed by Independent lawful owner of the parcel of land embraced in said title. The petitioners alleged therein
Mercantile Corporation. After the parties submitted their respective Memoranda, the that they are the true owners of the property, and that TCT No. 68568 which they sought
respondent Court issued an Order dated June 3, 1968 dismissing the petition. (Rollo, pp. to cancel was issued as a result of the errors which were not of their own making. In
31-38.) short, the petition raised a highly controversial matter which is beyond the judicial
competence of a cadastral court to pass upon or to adjudicate.
The herein petitioners did not appeal the dismissal of the petition they filed in LRC Record
No. 39492 for the cancellation of TCT No. 68568. Instead, on January 11, 1971, they filed It may neither be claimed that the parties have mutually agreed to submit the aforesaid
the complaint in Civil Case No. SCC-180 praying for the cancellation of the conveyances issues for the determination by the court, it being a fact that herein private respondent
and sales that had been made with respect to the property, covered by TCT No. 9138 was not a party in the petition in LRC Record No. 39492. Incidentally, although the said
previously registered in the name of Domingo Magali, married to Modesta Calimlim. petition was filed by the herein petitioners on November 21, 1967, the Opposition filed by

Page 41 of 100
Independent Mercantile Corporation to the said petition made no mention of the alleged It is neither fair nor legal to bind a party by the result of a suit or proceeding which was
sale of the property in question in favor of private respondent Francisco Ramos on July 5, taken cognizance of in a court which lacks jurisdiction over the same irrespective of the
1967. This circumstance places in grave doubt the sincerity of said sale and the claim that attendant circumstances. The equitable defense of estoppel requires knowledge or
the private respondent was an innocent purchaser for value of the property in question. consciousness of the facts upon which it is based. The same thing is true with estoppel by
conduct which may be asserted only when it is shown, among others, that the
In the order of the respondent Judge dated September 29, 1971 denying the second representation must have been made with knowledge of the facts and that the party to
motion for reconsideration, he cited the case of Tijam vs. Sibonghanoy, 23 SCRA 29, to whom it was made is ignorant of the truth of the matter. ( De Castro vs. Gineta, 27 SCRA
uphold the view that the petitioners are deemed estopped from questioning the 623.) The filing of an action or suit in a court that does not possess jurisdiction to
jurisdiction of the respondent Court in having taken cognizance of the petition for entertain the same may not be presumed to be deliberate and intended to secure a ruling
cancellation of TCT No. 68568, they being the ones who invoked the jurisdiction of the which could later be annulled if not favorable to the party who filed such suit or
said Court to grant the affirmative relief prayed for therein. We are of the opinion that the proceeding. Instituting such an action is not a one-sided affair. It can just as well be
ruling laid down in Sibonghanoy  may not be applied herein. Neither its factual backdrop prejudicial to the one who filed the action or suit in the event that he obtains a favorable
nor the philosophy of the doctrine therein expounded fits the case at bar. judgment therein which could also be attacked for having been rendered without
jurisdiction. The determination of the correct jurisdiction of a court is not a simple matter.
A rule that had been settled by unquestioned acceptance and upheld in decisions so It can raise highly debatable issues of such importance that the highest tribunal of the
numerous to cite is that the jurisdiction of a court over the subject-matter of the action is land is given the exclusive appellate jurisdiction to entertain the same. The point simply is
a matter of law and may not be conferred by consent or agreement of the parties. The that when a party commits error in filing his suit or proceeding in a court that lacks
lack of jurisdiction of a court may be raised at any stage of the proceedings, even on jurisdiction to take cognizance of the same, such act may not at once be deemed
appeal. This doctrine has been qualified by recent pronouncements which stemmed sufficient basis of estoppel. It could have been the result of an honest mistake, or of
principally from the ruling in the cited case of Sibonghanoy. It is to be regretted, divergent interpretations of doubtful legal provisions. If any fault is to be imputed to a
however, that the holding in said case had been applied to situations which were party taking such course of action, part of the blame should be placed on the court which
obviously not contemplated therein. The exceptional circumstance involved shall entertain the suit, thereby lulling the parties into believing that they pursued their
in Sibonghanoy which justified the departure from the accepted concept of non- remedies in the correct forum. Under the rules, it is the duty of the court to dismiss an
waivability of objection to jurisdiction has been ignored and, instead a blanket doctrine action "whenever it appears that the court has no jurisdiction over the subject matter."
had been repeatedly upheld that rendered the supposed ruling in Sibonghanoy not as the (Sec. 2, Rule 9, Rules of Court.) Should the court render a judgment without jurisdiction,
exception, but rather the general rule, virtually overthrowing altogether the time-honored such judgment may be impeached or annulled for lack of jurisdiction (Sec. 30, Rule 132,
principle that the issue of jurisdiction is not lost by waiver or by estoppel. Ibid), within ten (10) years from the finality of the same. (Art. 1144, par. 3, Civil Code.)
In  Sibonghanoy, the defense of lack of jurisdiction of the court that rendered the The inequity of barring the petitioners from vindicating their right over their property in
questioned ruling was held to be barred by estoppel by laches. It was ruled that the lack Civil Case No. SCC-180 is rendered more acute in the face of the undisputed fact that the
of jurisdiction having been raised for the first time in a motion to dismiss filed almost property in question admittedly belonged to the petitioners, and that the title in the name
fifteen (15) years after the questioned ruling had been rendered, such a plea may no of the private respondent was the result of an error committed by the Provincial Sheriff in
longer be raised for being barred by laches. As defined in said case, laches is "failure or issuing the deed of sale in the execution proceeding. The justness of the relief sought by
neglect, for an unreasonable and unexplained length of time, to do that which, by herein petitioners may not be ignored or rendered futile by reason of a doctrine which is
exercising due diligence, could or should have been done earlier; it is negligence or of highly doubtful applicability herein.
omission to assert a right within a reasonable time, warranting a presumption that the
party entitled to assert has abandoned it or declined to assert it." WHEREFORE, the Orders appealed from are hereby REVERSED and SET ASIDE. The
Motion To Dismiss filed by the private respondent in Civil Case No. SCC-180 shall be
The petitioners in the instant case may not be faulted with laches. When they learned that deemed denied and the respondent Court is ordered to conduct further proceedings in the
the title to the property owned by them had erroneously and illegally been cancelled and case. With costs against the private respondent.
registered in the name of another entity or person who had no right to the same, they
filed a petition to cancel the latter's title. It is unfortunate that in pursuing said remedy, SO ORDERED.
their counsel had to invoke the authority of the respondent Court as a cadastral court,
instead of its capacity as a court of general jurisdiction. Their petition to cancel the title in Teehankee (Chairman), Melencio-Herrera, Plana, Relova and Gutierrez, Jr., JJ., concur.
the name of Independent Mercantile Corporation was dismissed upon a finding by the
respondent Court that the same was "without merit." No explanation was given for such
dismissal nor why the petition lacked merit. There was no hearing, and the petition was
resolved solely on the basis of memoranda filed by the parties which do not appear of
record. It is even a possibility that such dismissal was in view of the realization of the
respondent Court that, sitting as a cadastral court, it lacked the authority to entertain the SECOND DIVISION
petition involving as it does a highly controversial issue. Upon such petition being
G.R. NO. 154295. July 29, 2005
dismissed, the petitioners instituted Civil Case No. SCC-180 on January 1, 1971, or only
two and one-half years after the dismissal of their petition in LRC Record No. 39492. METROMEDIA TIMES CORPORATION and/or ROBINA GOKONGWIE-
Hence, we see no unreasonable delay in the assertion by the petitioners of their right to PE, Petitioners, v. Johnny Pastorin, Respondent.
claim the property which rightfully belongs to them. They can hardly be presumed to
have abandoned or waived such right by inaction within an unreasonable length of time or DECISION
inexcusable negligence. In short, their filing of Civil Case No. SCC-180 which in itself is an
implied non-acceptance of the validity of the proceedings had in LRC Record No. 39492 TINGA, J.:
may not be deemed barred by estoppel by laches.

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At issue in this Petition for Review1 on certiorari under Rule 45 is whether or not lack of Petitioner lodged an appeal with the NLRC, raising as a ground the lack of jurisdiction of
jurisdiction over the subject matter of the case, heard and decided by the labor arbiter, the labor arbiter over respondent's complaint. Significally, this issue was not raised by
may be raised for the first time before the National Labor Relations Commission (NLRC) petitioner in the proceedings before the Labor Arbiter. In its Decision11 dated 16 March
by a litigant who had actively participated in the proceedings, which it belatedly 2001, the NLRC reversed the Labor Arbiter on the ground that thee latter had no
questioned. jurisdiction over the case, it being a grievance issue properly cognizable by the voluntary
arbitrator. The decretal portion of the NLRC Decision reads:
The facts, culled from the records, are as follows:
WHEREFORE, the decision under review is REVERSED and SET ASIDE, and a new one
Johnny Pastorin (Respondent) was employed by Metromedia Times Corporation entered, DISMISSING the complaint for lack of jurisdiction.
(Petitioner) on 10 December 1990 as a Field Representative/Collector. His task entailed
the periodic collection of receivables from dealers of petitioner's newspapers. Prior to the SO ORDERED.12
subject incident, respondent claimed to have received a termination letter dated 7 May
1998 from management terminating his services for tardiness effective 16 June 1988. The motion for reconsideration having been denied on 18 May 2001, respondent elevated
Respondent, member of Metro Media Times Employees Union, was not dismissed due to the case before the Court of Appeals (CA) through a Petition for  Certiorari13 under Rule
the intervention of the labor union, the collective bargaining agent in the company. 65.

In May 1998, he obtained a loan from one of the dealers whom he dealt with, Gloria A. de The CA Fifteenth Division reversed the Decision of NLRC, and reinstated the earlier ruling
Manuel (De Manuel), amounting to Nine Thousand Pesos (P9,000.00). After paying One of the Labor Arbiter. Adopting the doctrines by this Court in the cases of  Alfredo Marquez
Thousand One Hundred Twenty-five Pesos (P1,125.00), respondent reneged on the v. Sec. of Labor14 and ABS-CBN Supervisors Employees Union Members v. ABS-CBN
balance of his loan. De Manuel wrote a letter dated 6 July 1998 to petitioner, and seeking Broadcasting Corporation,15 the CA ruled that the active participation of the party against
assistance for collection on the remainder of the loan. She claimed that when respondent whom the action was brought, coupled with his failure to object to the jurisdiction of the
became remissed on his personal obligation, he stopped collecting periodically the court or quasi-judicial body where the action is pending, is tantamount to an invocation of
outstanding dues of De Manuel2 that jurisdiction and a willingness to abide by the resolution of the case and will bar said
party from later on impugning the court or body's jurisdiction. The appellate court then
On 9 July 1998, petitioner sent a letter addressed to respondent, requiring an explanation disposed the case in this wise:
for the transaction with De Manuel, as well as for his failure to pay back the loan
according to the conditions agreed upon. In his reply letter 3 dated 13 July 1998, WHEREFORE, foregoing premises considered, the petition having merit, in fact and in
respondent admitted having incurred the loan, but offered no definitive explanation for his law, is hereby GIVEN DUE COURSE. Accordingly, the challenged resolution/decision and
failure to repay the same. orders of public respondent NLRC are hereby REVERSED and SET ASIDE and the
decision of the Labor Arbiter dated May 28, 1999 REINSTATED with a slight
Petitioner, through a Memorandum 4 dated 24 August 1998, imposed the penalty of modification, that the 13th month pay be in the amount of P7,430.50. No costs.
suspension on respondent for 4 days, from 27 August to 1 September 1998, for violating
Company Policy No. 2.175 and ordered his transfer to the Administration Department. SO ORDERED.16

On 2 September 1998, respondent wrote a letter 6 to petitioner, stating that he wanted to Petitioner sought reconsideration17 of the above Decision18 but the CA denied the motion
sign a transfer memo before assuming his new position. in the assailed Resolution19 dated 27 June 2002. Hence, its recourse to this Court,
elevating the following issues:
On September 7, 1998, he was handed the Payroll Change Advice 7 (PCA), indicating his
new assignment to the Traffic and Order Department of Metromedia. Nonetheless, I.
respondent stopped reporting for work. On 16 September 1998, he sent a letter 8 to
petitioner communicating his refusal to accept the transfer. WHETHER OR NOT METROMEDIA IS ESTOPPED FROM QUESTIONING THE JURISDICTION
OF THE LABOR ARBITER OVER THE SUBJECT MATTER OF THE CASE FOR THE FIRST TIME
Respondent duly filed a complaint for constructive dismissal, non-payment of backwages ONLY IN THEIR APPEAL BEFORE THE NLRC.
and other money claims with the labor arbiter, a copy of which petitioner received on 28
September 1998. The complaint was resolved in favor of respondent. In a Decision9 dated II.
28 May 1999, Labor Arbiter Manuel P. Asuncion concluded that respondent did not
commit insubordination or disobedience so as to warrant his transfer, and that petitioner WHETHER OR NOT THE AWARD OF 13TH MONTH PAY BY THE LABOR ARBITER MAY BE
was not aggrieved by respondent's failure to settle his obligation with De Manuel. The MODIFIED, NOTWITHSTANDING THAT THE SAME WAS NEVER ASSIGNED AS AN ERROR.
dispositive portion read:
Anent the first assignment of error, there are divergent jurisprudential doctrines touching
WHEREFORE, the respondents are hereby ordered to reinstate the complainant to his on this issue. On the one hand are the cases of Martinez v. Merced,20 Marquez v.
former position, with full backwages from the time his salary was withheld until he is Secretary of Labor,21 Ducat v. Court of Appeals,22 Bayoca v. Nogales,23 Jimenez v.
actually reinstated. As of this date, the complainant's backwages has reached the sum Patricia,24 Centeno v. Centeno,25 and ABS-CBN Supervisors Employee Union Members v.
of P97,324.17. The respondents are further directed to pay the complainant his 13th ABS-CBN Broadcasting Corporation,26 all adhering to the doctrine that a party's active
month pay for 1998 in the sum of P3,611.89. The claims for allowance and unpaid participation in the actual proceedings before a court without jurisdiction will estop him
commission are dismissed for lack of sufficient basis to make an award. from assailing such lack of jurisdiction. Respondent heavily relies on this doctrinal
jurisprudence.
SO ORDERED.10
On the other hand, the cases of Dy v. NLRC,27 La Naval Drug v. CA,28 De Rossi v.
CA29 and Union Motors Corporation v. NLRC 30 buttress the position of petitioner that

Page 43 of 100
jurisdiction is conferred by law and lack of jurisdiction may be questioned at any time ". . . where the entertainment of the jurisdictional issue at a belated stage of the
even on appeal. proceedings will result in a failure of justice and render nugatory the constitutional
imperative of protection to labor."35
The Court of Appeals adopted the principles in the cases of Martinez, Marquez  and ABS-
CBN in resolving the jurisdictional issue presented for its resolution, to wit: In this case, jurisdiction of the labor arbiter was questioned as early as during appeal
before the NLRC, whereas in Marquez, the question of jurisdiction was raised for the first
Indeed, we agree with petitioner that private respondent was estopped from raising the time only before this Court. The viability of Marquez  as controlling doctrine in this case is
question of jurisdiction before public respondent NLRC and the latter gravely abused its diminished owing to the radically different circumstances in these two cases. A similar
discretion in addressing said question in private respondents' favor. As early as Martinez observation can be made as to the Bayoca and Jimenez  cases.36
v. De la Merced, 174 SCRA 182, the Supreme Court has clearly ruled thus: "For it has
been consistently held by this Court that while lack of jurisdiction may be assailed at any Neither do the other like-minded cases squarely settle the issue in favor of the
stage, a party's active participation in the proceedings before a court without jurisdiction respondent. In the case of Martinez, the issue is not jurisdiction by estoppel but waiver of
will estop such party from assailing such lack of jurisdiction." preliminary conference. In that case, we said:

.... As pointed out by petitioners, private respondents had at least three opportunities to
raise the question of lack of preliminary conference first, when private respondents filed a
The same principle was adopted by the Highest Tribunal in the case of Alfredo Marquez v. motion for extension of time to file their position paper; second, at the time when they
Sec. of Labor, 171 SCRA 337 and quoted in the latter case of ABS-CBN Supervisors actually filed their position paper in which they sought affirmative relief from the
Employees Union Members v. ABS-CBN Broadcasting Corporation, 304 SCRA 497, where Metropolitan Trial Court; and third; when they filed a motion for reconsideration of the
it was ruled that: "The active participation of the party against whom the action was order of the Metropolitan Trial Court expunging from the records the position paper of
brought, coupled with his failure to object to the jurisdiction of the court or quasi-judicial private respondents, in which motion private respondents even urged the court to sustain
body where the action is pending, is tantamount to an invocation of that jurisdiction and their position paper. And yet, in none of these instances was the issue of lack of
a willingness to abide by the resolution of the case and will bar said party from later on preliminary conference raised or even hinted at by private respondents. In fine, these are
impugning the court or body's jurisdiction."31 acts amounting to a waiver of the irregularity of the proceedings. For it has been
consistently held by this Court that while lack of jurisdiction may be assailed at any stage,
We rule differently. A cursory glance at these cases will lead one to the conclusion that a a party's active participation in the proceedings before a court without jurisdiction will
party who does not raise the jurisdictional question at the outset will be estopped to raise estop such party from assailing such lack of jurisdiction. 37
it on appeal. However, a more circumspect analysis would reveal that the cases cited by
respondent do not fall squarely within the issue and factual circumstances of the instant The case of Ducat  was categorical in saying that if the parties acquiesced in submitting an
case. We proceed to demonstrate. issue for determination by the trial court, they are estopped from questioning the
jurisdiction of the same court to pass upon the issue. But this should be taken in the
The notion that the defense of lack of jurisdiction may be waived by estoppel on the party context of the "agreement" of the parties. We quote from said case:
invoking the same most prominently emerged in Tijam v. Sibonghanoy.32 Indeed,
the Marquez case relied upon by the CA is in turn grounded on Tijam, where We held Petitioner's filing of a Manifestion and Urgent Motion to Set Parameters of Computation is
that: indicative of its conformity with the questioned order of the trial court referring the
matter of computation of the excess to SGV and simultaneously thereafter, the issuance
. . . a party can not invoke the jurisdiction of a court to secure affirmative relief against of a writ of possession. If petitioner thought that subject order was wrong, it could have
his opponent and, after obtaining or failing to obtain such relief, repudiate or question taken recourse to the Court of Appeals but petitioner did not. Instead he manifested his
that same jurisdiction (Dean v. Dean, 136 Or. 694, 86 A.L.R. 79). In the case just cited, acquiescence in the said order by seeking parameters before the trial court. It is now too
by way of explaining the rule, it was further said that the question whether the court had late for petitioner to question subject order of the trial court. Petitioner cannot be allowed
jurisdiction either of the subject-matter of the action or of the parties is barred from such to make a mockery of judicial processes, by changing his position from one of the
conduct not because the judgment or order of the court is valid and conclusive as an agreement to disagreement, to suit his needs. If the parties acquiesced in submitting an
adjudication, but for the reason that such a practice can not be tolerated obviously for issue for determination by the trial court, they are estopped from questioning the
reasons of public policy. jurisdiction of the same court to pass upon the issue. Petitioner is consequently estopped
from questioning subject order of the trial court.38
Furthermore, it has also been held that after voluntarily submitting a cause and
encountering an adverse decision on the merits, it is too late for the loser to question the Centeno involved the question of jurisdiction of the Department of Agrarian Reform
jurisdiction or power of the court . . . And in Littleton v. Burges, 16 Wyo, 58, the Court Arbitration Board (DARAB). The Court did rule therein that "participation by certain
said that it is not right for a party who has affirmed and invoked the jurisdiction of a court parties in the administrative proceedings without raising any objection thereto, bars them
in a particular matter to secure an affirmative relief, to afterwards deny that same from any jurisdictional infirmity after an adverse decision is rendered against
jurisdiction to escape a penalty.33 them."39 Still, the Court did recognize therein that the movants questioning jurisdiction
had actually sought and litigated for affirmative reliefs before the DARAB in support of a
However, Tijam represented an exceptional case wherein the party invoking lack of submitted counterclaim. No similar circumstance obtains in this case concerning the
jurisdiction did so only after fifteen (15) years, and at a stage when the proceedings had petitioner.
already been elevated to the Court of Appeals. Even Marquez recognizes
that Tijam stands as an exception, rather than a general rule. 34 The CA perhaps though Evidently, none of these cited precedents squarely operates as stare decisis on this case,
felt comfortable citing Marquez owing to the pronouncement therein that the Court would involving as they did different circumstances. The question now lies as to whether the
not hesitate to apply Tijam even absent the extraordinary circumstances therein: precedents cited by petitioner are more apropos to this case.

Page 44 of 100
Petitioner seeks to convince this Court that the instant case falls squarely within the tribunal, agency, or office, is conferred by law, and its lack of jurisdiction may be
purview of this Court's ruling in the case of Dy.  Admittedly, a different factual mileu was questioned at any time even on appeal. In La Naval Drug Corporation v. Court of Appeals,
present insofar as the questioned jurisdiction was alleged to have been properly lodged in 236 SCRA 78, 90, this Court said:
the SEC instead of NLRC. Yet the rationale employed by the Court therein warrants
serious consideration. The aforementioned case was ruled in this wise: "Lack of jurisdiction over the subject matter of the suit is yet another matter. Whenever it
appears that the court has no jurisdiction over the subject matter, the action shall be
. . . .More importantly, estoppel cannot be invoked to prevent this Court from taking up dismissed. This defense may be interposed at any time, during appeal or even after final
the question of jurisdiction, which has been apparent on the face of the pleadings since judgment. Such is understandable, as this kind of jurisdiction is conferred by law and not
the start of litigation before the Labor Arbiter. It is well settled that the decision of a within the courts, let alone the parties, to themselves determine or conveniently set
tribunal not vested with appropriate jurisdiction is null and void. Thus, in Calimlim v. aside."43
Ramirez, this Court held:
We held in the Union Motors Case:
"A rule that had been settled by unquestioned acceptance and upheld in decisions so
numerous to cite is that the jurisdiction of a court over the subject matter of the action is The long-established rule is that jurisdiction over a subject matter is conferred by law.
a matter of law and may not be conferred by consent or agreement of the parties. The [Ilaw at Buklod ng Manggaggawa v. NLRC, 219 SCRA 536 (1993); Atlas Developer &
lack of jurisdiction of a court may be raised at any stage of the proceedings, even on Steel Industries, Inc. v. Sarmiento Enterprises, Inc., 184 SCRA 153 (1990); Tijam v.
appeal. This doctrine has been qualified by recent pronouncements which stemmed Sibonghanoy, 23 SCRA 29, 30 (1968)]. Estoppel does not apply to confer jurisdiction to a
principally from the ruling in the cited case of Sibonghanoy. It is to be regretted, tribunal that has none over a cause of action. Where it appears that the court or tribunal
however, that the holding in said case had been applied to situations which were has no jurisdiction, then the defense may be interposed at any time, even on appeal or
obviously not contemplated therein. The exceptional circumstances involved even after final judgment. Moreover, the principle of estoppel cannot be invoked to
in Sibonghanoy which justified the departure from the accepted concept of non- prevent this court from taking up the question of jurisdiction. 44
waivability of objection to jurisdiction has been ignored and, instead a blanket doctrine
had been repeatedly upheld that rendered the supposed ruling in Sibonghanoy not as the The rulings in  Lozon v. NLRC45 addresses the issue at hand. This Court came up with a
exception, but rather the general rule, virtually overthrowing altogether the time honored clear rule as to when jurisdiction by estoppel applies and when it does not:
principle that the issue of jurisdiction is not lost by waiver or by estoppel.
Lack of jurisdiction over the subject matter of the suit is yet another matter. Whenever it
.... appears that the court has no jurisdiction over the subject matter, the action shall be
dismissed (Section 2, Rule 9, Rules of Court). This defense may be interposed at any
"It is neither fair nor legal to bind a party by the result of a suit or proceeding which was time, during appeal (Roxas v. Rafferty, 37 Phil. 957) or even after final judgment
taken cognizance of in a court which lacks jurisdiction over the same irrespective of the (Cruzcosa v. Judge Concepcion, et al., 101 Phil. 146). Such is understandable, as this
attendant circumstances. The equitable defense of estoppel requires knowledge or kind of jurisdiction is conferred by law and not within the courts, let alone the parties, to
consciousness of the facts upon which it is based. The same thing is true with estoppel by themselves determine or conveniently set aside. In People v. Casiano (111 Phil. 73, 93-
conduct which may be asserted only when it is shown, among others, that the 94), this Court, on the issue of estoppel, held:
representation must have been made with knowledge of the facts and that the party to
whom it was made is ignorant of the truth of the matter (De Castro v. Gineta, 27 SCRA "The operation of the principle of estoppel on the question of jurisdiction seemingly
623). The filing of an action or suit in a court that does not possess jurisdiction to depends upon whether the lower court actually had jurisdiction or not.  If it had no
entertain the same may not be presumed to be deliberate and intended to secure a ruling jurisdiction, but the case was tried and decided upon the theory that it had
which could later be annulled if not favorable to the party who filed such suit or jurisdiction, the parties are not barred, on appeal, from assailing such
proceeding in a court that lacks jurisdiction to take cognizance of the same, such act may jurisdiction, for the same 'must exist as a matter of law, and may not be
not at once be deemed sufficient basis of estoppel. It could have been te result of an conferred by consent of the parties or by estoppel' (5 C.J.S., 861-863). However,
honest mistake or of divergent interpretation of doubtful legal provisions. If any fault is to if the lower court had jurisdiction, and the case was heard and decided upon a
be imputed to a party taking such course of action, part of the blame should be placed on given theory, such, for instance, as that the court had no jurisdiction, the party
the court which shall entertain the suit, thereby lulling the parties into believing that they who induced it to adopt such theory will not be permitted, on appeal, to assume
pursued their remedies in the correct forum. Under the rules, it is the duty of the court to an inconsistent position that the lower court had jurisdiction. Here, the principle of
dismiss an action `whenever it appears that court has no jurisdiction over the subject estoppel applies. The rule that jurisdiction is conferred by law, and does not depend upon
matter. '(Section 2, Rule 9, Rules of Court) Should the Court render a judgment without the will of the parties, has no bearing thereon.46 (Emphasis supplied)ςrαlαωlιbrαrÿ
jurisdiction, such judgment may be impeached or annulled for lack of jurisdiction (Sec.
30, Rule 132, Ibid), within ten (10) years from the finality of the same (Art. 1144, par. 3, Verily,  Lozon, Union Motors, Dy  and De Rossi aptly resolve the jurisdictional issue
Civil Code)."40 obtaining in this case. Applying the guidelines in Lozon, the labor arbiter assumed
jurisdiction when he should not. In fact, the NLRC correctly reversed the labor arbiter's
The jurisdiction of the Labor Arbiter was assailed in the cases of De Rossi v. NLRC 41 and decision and ratiocinated:
Union Motors Corporation v. NLRC 42 during appeal to the NLRC. Since the same
circumstance obtains in this case, the rulings therein, favorable as they are to the What appears at first blush to be an issue which pertains to the propriety of complainant's
petitioner, are germane. reassignment to another job on account of his having contracted a private loan, is one
which may be considered as falling within the jurisdiction of the Office of the Labor
In De Rossi, this Court elucidated: Arbiter. Nevertheless, since the complainant is a union member, he should be bound by
the covenants provided for in the Collective Bargaining Agreement. 47
Petitioner maintains that MICC can not question now the issue of jurisdiction of the NLRC,
considering that MICC did not raise this matter until after the case had been brought on ....
appeal to the NLRC. However, it has long been established as a rule, that jurisdiction of a

Page 45 of 100
Based on the foregoing considerations, it appears that the issue of validity of
complainant's reassignment stemmed from the exercise of a management prerogative
which is a matter apt for resolution by a Grievance Committee, the parties having opted
to consider such as a grievable issue. Further, a review of the records would show that
the matter of reassignment is one not directly related to the charge of complainant's
having committed an act which is inimical to respondents' interest, since the latter had
already been addressed to by complainant's service of a suspension order. The transfer,
in effect, is one which properly falls under Section 1, Article IV of the Collective
Bargaining Agreement and, as such, questions as to the enforcement thereof is one which
falls under the jurisdiction of the labor arbiter."48

In line with the cases cited above and applying the general rule that estoppel does not
confer jurisdiction, petitioner is not estopped from assailing the jurisdiction of the labor
arbiter before the NLRC on appeal.

Respondent relied solely on estoppel to oppose petitioner's claim of lack of jurisdiction on

the part of the labor arbiter. He adduced no other legal ground in support of his
contention that the Labor Arbiter had jurisdiction over the case. Thus, his claim falls flat
in light of our pronouncement, and more so considering the NLRC's correct observation
that jurisdiction over grievance issues, such as the propriety of the reassignment of a
union member falls under the jurisdiction of the voluntary arbitrator.

Since jurisdiction does not lie with the Labor Arbiter, it is futile to discuss about the
computation of the 13th month pay.

WHEREFORE, the questioned decision of the Labor Arbiter and the Court of Appeals are
hereby REVERSED and SET ASIDE, and the decision of the NLRC in dismissing the
complaint for lack of jurisdiction REINSTATED.

SO ORDERED.

Puno, (Chairman), Austria-Martinez, Callejo, Sr., and Chico-Nazario, JJ., concur.

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 THIRD DIVISION bus driven by the petitioner not enough evidence to acquit him of the crime
charged?9
G.R. No. 147406               July 14, 2008
Applied uniformly is the familiar rule that the jurisdiction of the court to hear and decide a
VENANCIO FIGUEROA y CERVANTES, 1 Petitioner, vs. case is conferred by the law in force at the time of the institution of the action, unless
PEOPLE OF THE PHILIPPINES, Respondent. such statute provides for a retroactive application thereof. 10 In this case, at the time the
criminal information for reckless imprudence resulting in homicide with violation of the
DECISION Automobile Law (now Land Transportation and Traffic Code) was filed, Section 32(2) of
Batas Pambansa (B.P.) Blg. 129 11 had already been amended by Republic Act No.
NACHURA, J.: 7691.12 The said provision thus reads:
When is a litigant estopped by laches from assailing the jurisdiction of a tribunal? This is Sec. 32. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal
the paramount issue raised in this petition for review of the February 28, 2001 Circuit Trial Courts in Criminal Cases.—Except in cases falling within the exclusive original
Decision2 of the Court of Appeals (CA) in CA-G.R. CR No. 22697. jurisdiction of Regional Trial Courts and the Sandiganbayan, the Metropolitan Trial Courts,
Municipal Trial Courts, and Municipal Circuit Trial Courts shall exercise:
Pertinent are the following antecedent facts and proceedings:
xxxx
On July 8, 1994, an information3 for reckless imprudence resulting in homicide was filed
against the petitioner before the Regional Trial Court (RTC) of Bulacan, Branch 18. 4 The (2) Exclusive original jurisdiction over all offenses punishable with imprisonment not
case was docketed as Criminal Case No. 2235-M-94. 5 Trial on the merits ensued and on exceeding six (6) years irrespective of the amount of fine, and regardless of other
August 19, 1998, the trial court convicted the petitioner as charged. 6 In his appeal before imposable accessory or other penalties, including the civil liability arising from such
the CA, the petitioner questioned, among others, for the first time, the trial court’s offenses or predicated thereon, irrespective of kind, nature, value or amount thereof:
jurisdiction.7 Provided, however, That in offenses involving damage to property through criminal
negligence, they shall have exclusive original jurisdiction thereof.
The appellate court, however, in the challenged decision, considered the petitioner to
have actively participated in the trial and to have belatedly attacked the jurisdiction of the As the imposable penalty for the crime charged herein is prision correccional in its
RTC; thus, he was already estopped by laches from asserting the trial court’s lack of medium and maximum periods or imprisonment for 2 years, 4 months and 1 day to 6
jurisdiction. Finding no other ground to reverse the trial court’s decision, the CA affirmed years,13 jurisdiction to hear and try the same is conferred on the Municipal Trial Courts
the petitioner’s conviction but modified the penalty imposed and the damages awarded. 8 (MTCs). Clearly, therefore, the RTC of Bulacan does not have jurisdiction over Criminal
Case No. 2235-M-94.
Dissatisfied, the petitioner filed the instant petition for review on certiorari raising the
following issues for our resolution: While both the appellate court and the Solicitor General acknowledge this fact, they
nevertheless are of the position that the principle of estoppel by laches has already
a. Does the fact that the petitioner failed to raise the issue of jurisdiction during
precluded the petitioner from questioning the jurisdiction of the RTC—the trial went on for
the trial of this case, which was initiated and filed by the public prosecutor
4 years with the petitioner actively participating therein and without him ever raising the
before the wrong court, constitute laches in relation to the doctrine laid down in
jurisdictional infirmity. The petitioner, for his part, counters that the lack of jurisdiction of
Tijam v. Sibonghanoy, notwithstanding the fact that said issue was immediately
a court over the subject matter may be raised at any time even for the first time on
raised in petitioner’s appeal to the Honorable Court of Appeals? Conversely,
appeal. As undue delay is further absent herein, the principle of laches will not be
does the active participation of the petitioner in the trial of his case, which is
applicable.
initiated and filed not by him but by the public prosecutor, amount to estoppel?
To settle once and for all this problem of jurisdiction vis-à-vis estoppel by laches, which
b. Does the admission of the petitioner that it is difficult to immediately stop a
continuously confounds the bench and the bar, we shall analyze the various Court
bus while it is running at 40 kilometers per hour for the purpose of avoiding a
decisions on the matter.
person who unexpectedly crossed the road, constitute enough incriminating
evidence to warrant his conviction for the crime charged? As early as 1901, this Court has declared that unless jurisdiction has been conferred by
some legislative act, no court or tribunal can act on a matter submitted to it. 14 We went
c. Is the Honorable Court of Appeals justified in considering the place of accident
on to state in U.S. v. De La Santa15 that:
as falling within Item 4 of Section 35 (b) of the Land Transportation and Traffic
Code, and subsequently ruling that the speed limit thereto is only 20 kilometers It has been frequently held that a lack of jurisdiction over the subject-matter is fatal, and
per hour, when no evidence whatsoever to that effect was ever presented by subject to objection at any stage of the proceedings, either in the court below or on
the prosecution during the trial of this case? appeal (Ency. of Pl. & Pr., vol. 12, p. 189, and large array of cases there cited), and
indeed, where the subject-matter is not within the jurisdiction, the court may dismiss the
d. Is the Honorable Court of Appeals justified in convicting the petitioner for
proceeding ex mero motu. (4 Ill., 133; 190 Ind., 79; Chipman vs. Waterbury, 59 Conn.,
homicide through reckless imprudence (the legally correct designation is
496.)
"reckless imprudence resulting to homicide") with violation of the Land
Transportation and Traffic Code when the prosecution did not prove this during Jurisdiction over the subject-matter in a judicial proceeding is conferred by the sovereign
the trial and, more importantly, the information filed against the petitioner does authority which organizes the court; it is given only by law and in the manner prescribed
not contain an allegation to that effect? by law and an objection based on the lack of such jurisdiction can not be waived by the
parties. x x x16
e. Does the uncontroverted testimony of the defense witness Leonardo Hernal
that the victim unexpectedly crossed the road resulting in him getting hit by the

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Later, in People v. Casiano,17 the Court explained: Laches, in a general sense, is failure or neglect, for an unreasonable and unexplained
length of time, to do that which, by exercising due diligence, could or should have been
4. The operation of the principle of estoppel on the question of jurisdiction seemingly done earlier; it is negligence or omission to assert a right within a reasonable time,
depends upon whether the lower court actually had jurisdiction or not. If it had no warranting a presumption that the party entitled to assert it either has abandoned it or
jurisdiction, but the case was tried and decided upon the theory that it had jurisdiction, declined to assert it.
the parties are not barred, on appeal, from assailing such jurisdiction, for the same "must
exist as a matter of law, and may not be conferred by consent of the parties or by The doctrine of laches or of "stale demands" is based upon grounds of public policy which
estoppel" (5 C.J.S., 861-863). However, if the lower court had jurisdiction, and the case requires, for the peace of society, the discouragement of stale claims and, unlike the
was heard and decided upon a given theory, such, for instance, as that the court had no statute of limitations, is not a mere question of time but is principally a question of the
jurisdiction, the party who induced it to adopt such theory will not be permitted, on inequity or unfairness of permitting a right or claim to be enforced or asserted.
appeal, to assume an inconsistent position—that the lower court had jurisdiction. Here,
the principle of estoppel applies. The rule that jurisdiction is conferred by law, and does It has been held that a party cannot invoke the jurisdiction of a court to secure
not depend upon the will of the parties, has no bearing thereon. Thus, Corpus Juris affirmative relief against his opponent and, after obtaining or failing to obtain such relief,
Secundum says: repudiate or question that same jurisdiction (Dean vs. Dean, 136 Or. 694, 86 A.L.R. 79).
In the case just cited, by way of explaining the rule, it was further said that the question
Where accused has secured a decision that the indictment is void, or has been granted an whether the court had jurisdiction either of the subject matter of the action or of the
instruction based on its defective character directing the jury to acquit, he is estopped, parties was not important in such cases because the party is barred from such conduct
when subsequently indicted, to assert that the former indictment was valid. In such case, not because the judgment or order of the court is valid and conclusive as an adjudication,
there may be a new prosecution whether the indictment in the former prosecution was but for the reason that such a practice cannot be tolerated—obviously for reasons of
good or bad. Similarly, where, after the jury was impaneled and sworn, the court on public policy.
accused's motion quashed the information on the erroneous assumption that the court
had no jurisdiction, accused cannot successfully plead former jeopardy to a new Furthermore, it has also been held that after voluntarily submitting a cause and
information. x x x (22 C.J.S., sec. 252, pp. 388-389; italics ours.) encountering an adverse decision on the merits, it is too late for the loser to question the
jurisdiction or power of the court (Pease vs. Rathbun-Jones etc., 243 U.S. 273, 61 L. Ed.
Where accused procured a prior conviction to be set aside on the ground that the court 715, 37 S.Ct. 283; St. Louis etc. vs. McBride, 141 U.S. 127, 35 L. Ed. 659). And in
was without jurisdiction, he is estopped subsequently to assert, in support of a defense of Littleton vs. Burgess, 16 Wyo. 58, the Court said that it is not right for a party who has
previous jeopardy, that such court had jurisdiction." (22 C.J.S. p. 378.) 18 affirmed and invoked the jurisdiction of a court in a particular matter to secure an
affirmative relief, to afterwards deny that same jurisdiction to escape a penalty.
But in Pindañgan Agricultural Co., Inc. v. Dans, 19 the Court, in not sustaining the plea of
lack of jurisdiction by the plaintiff-appellee therein, made the following observations: Upon this same principle is what We said in the three cases mentioned in the resolution of
the Court of Appeals of May 20, 1963 (supra)—to the effect that we frown upon the
It is surprising why it is only now, after the decision has been rendered, that the plaintiff- "undesirable practice" of a party submitting his case for decision and then accepting the
appellee presents the question of this Court’s jurisdiction over the case. Republic Act No. judgment, only if favorable, and attacking it for lack of jurisdiction, when adverse—as well
2613 was enacted on August 1, 1959. This case was argued on January 29, 1960. as in Pindañgan etc. vs. Dans et al., G.R. L-14591, September 26, 1962; Montelibano et
Notwithstanding this fact, the jurisdiction of this Court was never impugned until the al. vs. Bacolod-Murcia Milling Co., Inc., G.R. L-15092; Young Men Labor Union etc. vs.
adverse decision of this Court was handed down. The conduct of counsel leads us to The Court of Industrial Relations et al., G.R. L-20307, Feb. 26, 1965, and Mejia vs. Lucas,
believe that they must have always been of the belief that notwithstanding said 100 Phil. p. 277.
enactment of Republic Act 2613 this Court has jurisdiction of the case, such conduct being
born out of a conviction that the actual real value of the properties in question actually The facts of this case show that from the time the Surety became a quasi-party on July
exceeds the jurisdictional amount of this Court (over ₱200,000). Our minute resolution in 31, 1948, it could have raised the question of the lack of jurisdiction of the Court of First
G.R. No. L-10096, Hyson Tan, et al. vs. Filipinas Compaña de Seguros, et al., of March Instance of Cebu to take cognizance of the present action by reason of the sum of money
23, 1956, a parallel case, is applicable to the conduct of plaintiff-appellee in this case, involved which, according to the law then in force, was within the original exclusive
thus: jurisdiction of inferior courts. It failed to do so. Instead, at several stages of the
proceedings in the court a quo, as well as in the Court of Appeals, it invoked the
x x x that an appellant who files his brief and submits his case to the Court of Appeals for jurisdiction of said courts to obtain affirmative relief and submitted its case for a final
decision, without questioning the latter’s jurisdiction until decision is rendered therein, adjudication on the merits. It was only after an adverse decision was rendered by the
should be considered as having voluntarily waived so much of his claim as would exceed Court of Appeals that it finally woke up to raise the question of jurisdiction. Were we to
the jurisdiction of said Appellate Court; for the reason that a contrary rule would sanction such conduct on its part, We would in effect be declaring as useless all the
encourage the undesirable practice of appellants submitting their cases for decision to the proceedings had in the present case since it was commenced on July 19, 1948 and
Court of Appeals in expectation of favorable judgment, but with intent of attacking its compel the judgment creditors to go up their Calvary once more. The inequity and
jurisdiction should the decision be unfavorable: x x x20 unfairness of this is not only patent but revolting.22

Then came our ruling in Tijam v. Sibonghanoy 21 that a party may be barred by laches For quite a time since we made this pronouncement in Sibonghanoy, courts and tribunals,
from invoking lack of jurisdiction at a late hour for the purpose of annulling everything in resolving issues that involve the belated invocation of lack of jurisdiction, have applied
done in the case with the active participation of said party invoking the plea. We the principle of estoppel by laches. Thus, in Calimlim v. Ramirez, 23 we pointed out that
expounded, thus: Sibonghanoy was developing into a general rule rather than the exception:

A party may be estopped or barred from raising a question in different ways and for A rule that had been settled by unquestioned acceptance and upheld in decisions so
different reasons. Thus, we speak of estoppel in pais, of estoppel by deed or by record, numerous to cite is that the jurisdiction of a court over the subject-matter of the action is
and of estoppel by laches. a matter of law and may not be conferred by consent or agreement of the parties. The

Page 48 of 100
lack of jurisdiction of a court may be raised at any stage of the proceedings, even on reconstitution throughout the duration of LCR Case No. Q-60161(93). On the contrary,
appeal. This doctrine has been qualified by recent pronouncements which stemmed private respondents actively participated in the reconstitution proceedings by filing
principally from the ruling in the cited case of Sibonghanoy. It is to be regretted, pleadings and presenting its evidence. They invoked the trial court’s jurisdiction in order
however, that the holding in said case had been applied to situations which were to obtain affirmative relief – the reconstitution of their titles. Private respondents have
obviously not contemplated therein. The exceptional circumstance involved in thus foreclosed their right to raise the issue of jurisdiction by their own actions.
Sibonghanoy which justified the departure from the accepted concept of non-waivability
of objection to jurisdiction has been ignored and, instead a blanket doctrine had been The Court has constantly upheld the doctrine that while jurisdiction may be assailed at
repeatedly upheld that rendered the supposed ruling in Sibonghanoy not as the any stage, a litigant’s participation in all stages of the case before the trial court,
exception, but rather the general rule, virtually overthrowing altogether the time-honored including the invocation of its authority in asking for affirmative relief, bars such party
principle that the issue of jurisdiction is not lost by waiver or by estoppel. from challenging the court’s jurisdiction (PNOC Shipping and Transport Corporation vs.
Court of Appeals, 297 SCRA 402 [1998]). A party cannot invoke the jurisdiction of a court
In Sibonghanoy, the defense of lack of jurisdiction of the court that rendered the to secure affirmative relief against his opponent and after obtaining or failing to obtain
questioned ruling was held to be barred by estoppel by laches. It was ruled that the lack such relief, repudiate or question that same jurisdiction (Asset Privatization Trust vs.
of jurisdiction having been raised for the first time in a motion to dismiss filed almost Court of Appeals, 300 SCRA 579 [1998]; Province of Bulacan vs. Court of Appeals, 299
fifteen (15) years after the questioned ruling had been rendered, such a plea may no SCRA 442 [1998]). The Court frowns upon the undesirable practice of a party
longer be raised for being barred by laches. As defined in said case, laches is "failure or participating in the proceedings and submitting his case for decision and then accepting
neglect, for an unreasonable and unexplained length of time, to do that which, by judgment, only if favorable, and attacking it for lack of jurisdiction, when adverse
exercising due diligence, could or should have been done earlier; it is negligence or (Producers Bank of the Philippines vs. NLRC, 298 SCRA 517 [1998], citing Ilocos Sur
omission to assert a right within a reasonable time, warranting a presumption that the Electric Cooperative, Inc. vs. NLRC, 241 SCRA 36 [1995]). (italics ours)26
party entitled to assert has abandoned it or declined to assert it.24
Noteworthy, however, is that, in the 2005 case of Metromedia Times Corporation v.
In Calimlim, despite the fact that the one who benefited from the plea of lack of Pastorin,27 where the issue of lack of jurisdiction was raised only in the National Labor
jurisdiction was the one who invoked the court’s jurisdiction, and who later obtained an Relations Commission (NLRC) on appeal, we stated, after examining the doctrines of
adverse judgment therein, we refused to apply the ruling in Sibonghanoy. The Court jurisdiction vis-à-vis estoppel, that the ruling in Sibonghanoy stands as an exception,
accorded supremacy to the time-honored principle that the issue of jurisdiction is not lost rather than the general rule. Metromedia, thus, was not estopped from assailing the
by waiver or by estoppel. jurisdiction of the labor arbiter before the NLRC on appeal.281avvphi1

Yet, in subsequent cases decided after Calimlim, which by sheer volume are too plentiful Later, in Francel Realty Corporation v. Sycip, 29 the Court clarified that:
to mention, the Sibonghanoy doctrine, as foretold in Calimlim, became the rule rather
than the exception. As such, in Soliven v. Fastforms Philippines, Inc.,25 the Court ruled: Petitioner argues that the CA’s affirmation of the trial court’s dismissal of its case was
erroneous, considering that a full-blown trial had already been conducted. In effect, it
While it is true that jurisdiction may be raised at any time, "this rule presupposes that contends that lack of jurisdiction could no longer be used as a ground for dismissal after
estoppel has not supervened." In the instant case, respondent actively participated in all trial had ensued and ended.
stages of the proceedings before the trial court and invoked its authority by asking for an
affirmative relief. Clearly, respondent is estopped from challenging the trial court’s The above argument is anchored on estoppel by laches, which has been used quite
jurisdiction, especially when an adverse judgment has been rendered. In PNOC  Shipping successfully in a number of cases to thwart dismissals based on lack of jurisdiction. Tijam
and Transport Corporation vs. Court of Appeals, we held: v. Sibonghanoy, in which this doctrine was espoused, held that a party may be barred
from questioning a court’s jurisdiction after being invoked to secure affirmative relief
Moreover, we note that petitioner did not question at all the jurisdiction of the lower court against its opponent. In fine, laches prevents the issue of lack of jurisdiction from being
x x x in its answers to both the amended complaint and the second amended complaint. raised for the first time on appeal by a litigant whose purpose is to annul everything done
It did so only in its motion for reconsideration of the decision of the lower court after it in a trial in which it has actively participated.
had received an adverse decision. As this Court held in Pantranco North Express, Inc. vs.
Court of Appeals (G.R. No. 105180, July 5, 1993, 224 SCRA 477, 491), participation in all Laches is defined as the "failure or neglect for an unreasonable and unexplained length of
stages of the case before the trial court, that included invoking its authority in asking for time, to do that which, by exercising due diligence, could or should have been done
affirmative relief, effectively barred petitioner by estoppel from challenging the court’s earlier; it is negligence or omission to assert a right within a reasonable time, warranting
jurisdiction. Notably, from the time it filed its answer to the second amended complaint a presumption that the party entitled to assert it either has abandoned it or declined to
on April 16, 1985, petitioner did not question the lower court’s jurisdiction. It was only on assert it."
December 29, 1989 when it filed its motion for reconsideration of the lower court’s
decision that petitioner raised the question of the lower court’s lack of jurisdiction. The ruling in Sibonghanoy on the matter of jurisdiction is, however, the exception rather
Petitioner thus foreclosed its right to raise the issue of jurisdiction by its own inaction. than the rule.1avvphi1 Estoppel by laches may be invoked to bar the issue of lack of
(italics ours) jurisdiction only in cases in which the factual milieu is analogous to that in the cited case.
In such controversies, laches should be clearly present; that is, lack of jurisdiction must
Similarly, in the subsequent case of Sta. Lucia Realty and Development, Inc. vs. Cabrigas, have been raised so belatedly as to warrant the presumption that the party entitled to
we ruled: assert it had abandoned or declined to assert it. That Sibonghanoy applies only to
exceptional circumstances is clarified in Calimlim v. Ramirez, which we quote:
In the case at bar, it was found by the trial court in its 30 September 1996 decision in
LCR Case No. Q-60161(93) that private respondents (who filed the petition for A rule that had been settled by unquestioned acceptance and upheld in decisions so
reconstitution of titles) failed to comply with both sections 12 and 13 of RA 26 and numerous to cite is that the jurisdiction of a court over the subject-matter of the action is
therefore, it had no jurisdiction over the subject matter of the case. However, private a matter of law and may not be conferred by consent or agreement of the parties. The
respondents never questioned the trial court’s jurisdiction over its petition for lack of jurisdiction of a court may be raised at any stage of the proceedings, even on

Page 49 of 100
appeal. This doctrine has been qualified by recent pronouncements which stemmed appellate court’s directive to show cause why she should not be cited for contempt and
principally from the ruling in the cited case of Sibonghanoy. It is to be regretted, filing a single piece of pleading to that effect could not be considered as an active
however, that the holding in said case had been applied to situations which were participation in the judicial proceedings so as to take the case within the milieu
obviously not contemplated therein. The exceptional circumstance involved in of Sibonghanoy.  Rather, it is the natural fear to disobey the mandate of the court that
Sibonghanoy which justified the departure from the accepted concept of non-waivability could lead to dire consequences that impelled her to comply. 34
of objection to jurisdiction has been ignored and, instead a blanket doctrine had been
repeatedly upheld that rendered the supposed ruling in Sibonghanoy not as the The Court, thus, wavered on when to apply the exceptional circumstance in Sibonghanoy
exception, but rather the general rule, virtually overthrowing altogether the time-honored and on when to apply the general rule enunciated as early as in De La Santa and
principle that the issue of jurisdiction is not lost by waiver or by estoppel. expounded at length in Calimlim. The general rule should, however, be, as it has always
been, that the issue of jurisdiction may be raised at any stage of the proceedings, even
Indeed, the general rule remains: a court’s lack of jurisdiction may be raised at any stage on appeal, and is not lost by waiver or by estoppel. Estoppel by laches, to bar a litigant
of the proceedings, even on appeal. The reason is that jurisdiction is conferred by law, from asserting the court’s absence or lack of jurisdiction, only supervenes in exceptional
and lack of it affects the very authority of the court to take cognizance of and to render cases similar to the factual milieu of Tijam v. Sibonghanoy. Indeed, the fact that a person
judgment on the action. Moreover, jurisdiction is determined by the averments of the attempts to invoke unauthorized jurisdiction of a court does not estop him from thereafter
complaint, not by the defenses contained in the answer. 30 challenging its jurisdiction over the subject matter, since such jurisdiction must arise by
law and not by mere consent of the parties. This is especially true where the person
Also, in Mangaliag v. Catubig-Pastoral,31 even if the pleader of lack of jurisdiction actively seeking to invoke unauthorized jurisdiction of the court does not thereby secure any
took part in the trial proceedings by presenting a witness to seek exoneration, the Court, advantage or the adverse party does not suffer any harm.35
reiterating the doctrine in Calimlim, said:
Applying the said doctrine to the instant case, the petitioner is in no way estopped by
Private respondent argues that the defense of lack of jurisdiction may be waived by laches in assailing the jurisdiction of the RTC, considering that he raised the lack thereof
estoppel through active participation in the trial. Such, however, is not the general rule in his appeal before the appellate court. At that time, no considerable period had yet
but an exception, best characterized by the peculiar circumstances in Tijam vs. elapsed for laches to attach. True, delay alone, though unreasonable, will not sustain the
Sibonghanoy. In Sibonghanoy, the party invoking lack of jurisdiction did so only after defense of "estoppel by laches" unless it further appears that the party, knowing his
fifteen years and at a stage when the proceedings had already been elevated to the rights, has not sought to enforce them until the condition of the party pleading laches has
CA. Sibonghanoy  is an exceptional case because of the presence of laches, which was in good faith become so changed that he cannot be restored to his former state, if the
defined therein as failure or neglect for an unreasonable and unexplained length of time rights be then enforced, due to loss of evidence, change of title, intervention of equities,
to do that which, by exercising due diligence, could or should have been done earlier; it is and other causes.36 In applying the principle of estoppel by laches in the exceptional case
the negligence or omission to assert a right within a reasonable time, warranting a of Sibonghanoy, the Court therein considered the patent and revolting inequity and
presumption that the party entitled to assert has abandoned it or declined to assert it. 32 unfairness of having the judgment creditors go up their Calvary once more after more or
less 15 years.37 The same, however, does not obtain in the instant case.
And in the more recent Regalado v. Go, 33 the Court again emphasized that laches should
be clearly present for the Sibonghanoy doctrine to be applicable, thus: We note at this point that estoppel, being in the nature of a forfeiture, is not favored by
law. It is to be applied rarely—only from necessity, and only in extraordinary
Laches is defined as the "failure or neglect for an unreasonable and unexplained length of circumstances. The doctrine must be applied with great care and the equity must be
time, to do that which, by exercising due diligence, could or should have been done strong in its favor.38 When misapplied, the doctrine of estoppel may be a most effective
earlier, it is negligence or omission to assert a right within a reasonable length of time, weapon for the accomplishment of injustice. 39 Moreover, a judgment rendered without
warranting a presumption that the party entitled to assert it either has abandoned it or jurisdiction over the subject matter is void. 40 Hence, the Revised Rules of Court provides
declined to assert it." for remedies in attacking judgments rendered by courts or tribunals that have no
jurisdiction over the concerned cases. No laches will even attach when the judgment is
The ruling in People v. Regalario that was based on the landmark doctrine enunciated in null and void for want of jurisdiction. 41 As we have stated in Heirs of Julian Dela Cruz and
Tijam v. Sibonghanoy on the matter of jurisdiction by estoppel is the exception rather Leonora Talaro v. Heirs of Alberto Cruz, 42
than the rule. Estoppel by laches may be invoked to bar the issue of lack of jurisdiction
only in cases in which the factual milieu is analogous to that in the cited case. In such It is axiomatic that the jurisdiction of a tribunal, including a quasi-judicial officer or
controversies, laches should have been clearly present; that is, lack of jurisdiction must government agency, over the nature and subject matter of a petition or complaint is
have been raised so belatedly as to warrant the presumption that the party entitled to determined by the material allegations therein and the character of the relief prayed for,
assert it had abandoned or declined to assert it. irrespective of whether the petitioner or complainant is entitled to any or all such reliefs.
Jurisdiction over the nature and subject matter of an action is conferred by the
In  Sibonghanoy, the defense of lack of jurisdiction was raised for the first time in a Constitution and the law, and not by the consent or waiver of the parties where the court
motion to dismiss filed by the Surety almost 15 years after the questioned ruling had otherwise would have no jurisdiction over the nature or subject matter of the action. Nor
been rendered. At several stages of the proceedings, in the court a quo as well as in the can it be acquired through, or waived by, any act or omission of the parties. Moreover,
Court of Appeals, the Surety invoked the jurisdiction of the said courts to obtain estoppel does not apply to confer jurisdiction to a tribunal that has none over the cause of
affirmative relief and submitted its case for final adjudication on the merits. It was only action. x x x
when the adverse decision was rendered by the Court of Appeals that it finally woke up to
raise the question of jurisdiction. Indeed, the jurisdiction of the court or tribunal is not affected by the defenses or theories
set up by the defendant or respondent in his answer or motion to dismiss. Jurisdiction
Clearly, the factual settings attendant in Sibonghanoy  are not present in the case at bar. should be determined by considering not only the status or the relationship of the parties
Petitioner Atty. Regalado, after the receipt of the Court of Appeals resolution finding her but also the nature of the issues or questions that is the subject of the controversy. x x x
guilty of contempt, promptly filed a Motion for Reconsideration assailing the said court’s
jurisdiction based on procedural infirmity in initiating the action. Her compliance with the

Page 50 of 100
x The proceedings before a court or tribunal without jurisdiction, including its decision,
are null and void, hence, susceptible to direct and collateral attacks. 43

With the above considerations, we find it unnecessary to resolve the other issues raised in
the petition.

WHEREFORE, premises considered, the petition for review on certiorari is GRANTED.

Criminal Case No. 2235-M-94 is hereby DISMISSED without prejudice. SO ORDERED.

Page 51 of 100
 FIRST DIVISION ART. 217. Jurisdiction of Labor Arbiters and the Commission. — (a) The Labor
Arbiters shall have the original and exclusive jurisdiction to hear and decide
G.R. No. 89621 September 24, 1991 within thirty (30) working days after submission of the case by the parties for
decision, the following cases involving all workers, whether agricultural or non-
PEPSI COLA DISTRIBUTORS OF THE PHILIPPINES, INC., represented by its Plant agricultural:
General Manager ANTHONY B. SIAN, ELEAZAR LIMBAB, IRENEO BALTAZAR &
JORGE HERAYA, petitioners, vs. 1. Unfair labor practice cases;
HON. LOLITA O. GAL-LANG, SALVADOR NOVILLA, ALEJANDRO OLIVA, WILFREDO
CABAÑAS & FULGENCIO LEGO, respondents. 2. Those that workers may file involving wages, hours of work and other terms
and conditions of employment;
Aurelio D. Menzon for petitioners.
Mario P. Nicolasora co-counsel for petitioners. 3. All money claims of workers, including those based on non-payment or
Papiano L. Santo for private respondents. underpayment of wages, overtime compensation, separation pay and other
benefits provided by law or appropriate agreement, except claims for
employees' compensation, social security, medicare and maternity benefits;

4. Cases involving household services; and

CRUZ, J.:
5. Cases arising from any violation of Article 265 of this Code, including
The question now before us has been categorically resolved in earlier decisions of the questions involving the legality of strikes and lockouts.
Court that a little more diligent research would have disclosed to the petitioners. On the
(b) The Commission shall have exclusive appellate jurisdiction over all cases
basis of those cases and the facts now before us, the petition must be denied.
decided by labor Arbiters.2
The private respondents were employees of the petitioner who were suspected of
It must be stressed that not every controversy involving workers and their employers can
complicity in the irregular disposition of empty Pepsi Cola bottles. On July 16, 1987, the
be resolved only by the labor arbiters. This will be so only if there is a "reasonable causal
petitioners filed a criminal complaint for theft against them but this was later withdrawn
connection" between the claim asserted and employee-employer relations to put the case
and substituted with a criminal complaint for falsification of private documents. On
under the provisions of Article 217. Absent such a link, the complaint will be cognizable
November 26, 1987, after a preliminary investigation conducted by the Municipal Trial
by the regular courts of justice in the exercise of their civil and criminal jurisdiction.
Court of Tanauan, Leyte, the complaint was dismissed. The dismissal was affirmed on
April 8, 1988, by the Office of the Provincial Prosecutor. In Medina v. Castro-Bartolome,3 two employees filed in the Court of First Instance of Rizal
a civil complaint for damages against their employer for slanderous remarks made against
Meantime, allegedly after an administrative investigation, the private respondents were
them by the company president. On the order dismissing the case because it came under
dismissed by the petitioner company on November 23, 1987. As a result, they lodged a
the jurisdiction of the labor arbiters, Justice Vicente Abad Santos said for the Court:
complaint for illegal dismissal with the Regional Arbitration Branch of the NLRC in
Tacloban City on December 1, 1987, and decisions manded reinstatement with damages. It is obvious from the complaint that the plaintiffs have not alleged any unfair
In addition, they instituted in the Regional Trial Court of Leyte, on April 4, 1988, a labor practice. Theirs is a simple action for damages for tortious acts allegedly
separate civil complaint against the petitioners for damages arising from what they committed by the defendants. Such being the case, the governing statute is the
claimed to be their malicious prosecution. Civil Code and not the Labor Code. It results that the orders under review are
based on a wrong premise.
The petitioners moved to dismiss the civil complaint on the ground that the trial court had
no jurisdiction over the case because it involved employee-employer relations that were In Singapore Airlines Ltd. v. Paño,4 where the plaintiff was suing for damages for alleged
exclusively cognizable by the labor arbiter. The motion was granted on February 6, 1989. violation by the defendant of an "Agreement for a Course of Conversion Training at the
On July 6, 1989, however, the respondent judge, acting on the motion for Expense of Singapore Airlines Limited," the jurisdiction of the Court of First Instance of
reconsideration, reinstated the complaint, saying it was "distinct from the labor case for Rizal over the case was questioned. The Court, citing the earlier case of Quisaba v. Sta.
damages now pending before the labor courts." The petitioners then came to this Court Ines Melale Veneer and Plywood, Inc.,5 declared through Justice Herrera:
for relief.
Stated differently, petitioner seeks protection under the civil laws and claims no
The petitioners invoke Article 217 of the Labor Code and a number of decisions of this benefits under the Labor Code. The primary relief sought is for liquidated
Court to support their position that the private respondents civil complaint for damages damages for breach of a contractual obligation. The other items demanded are
falls under the jurisdiction of the labor arbiter. They particularly cite the case of  Getz not labor benefits demanded by workers generally taken cognizance of in labor
Corporation v. Court of Appeals,1 where it was held that a court of first instance had no disputes, such as payment of wages, overtime compensation or separation pay.
jurisdiction over the complaint filed by a dismissed employee "for unpaid salary and other The items claimed are the natural consequences flowing from breach of an
employment benefits, termination pay and moral and exemplary damages." obligation, intrinsically a civil dispute.
We hold at the outset that the case is not in point because what was involved there was a In Molave Sales, Inc. v. Laron,6 the same Justice held for the Court that the claim of the
claim arising from the alleged illegal dismissal of an employee, who chose to complain to plaintiff against its sales manager for payment of certain accounts pertaining to his
the regular court and not to the labor arbiter. Obviously, the claim arose from employee- purchase of vehicles and automotive parts, repairs of such vehicles, and cash advances
employer relations and so came under Article 217 of the Labor Code which then provided from the corporation was properly cognizable by the Regional Trial Court of Dagupan City
as follows:

Page 52 of 100
and not the labor arbiter, because "although a controversy is between an employer and intended "to harass the poor employees" and the dismissal of which was affirmed by the
an employee, the Labor Arbiters have nojurisdiction if the Labor Code is not involved." Provincial Prosecutor "for lack of evidence to establish even a slightest probability that all
the respondents herein have committed the crime imputed against them." This is a
The latest ruling on this issue is found in San Miguel Corporation v. NLRC,7 where the matter which the labor arbiter has no competence to resolve as the applicable law is not
above cases are cited and the changes in Article 217 are recounted. That case involved a the Labor Code but the Revised Penal Code.
claim of an employee for a P60,000.00 prize for a proposal made by him which he alleged
had been accepted and implemented by the defendant corporation in the processing of "Talents differ, all is well and wisely put," so observed the philosopher-poet. 8 So it must
one of its beer products. The claim was filed with the labor arbiter, who dismissed it for be in the case we here decide.
lack of jurisdiction but was reversed by the NLRC on appeal. In setting aside the appealed
decision and dismissing the complaint, the Court observed through Justice Feliciano: WHEREFORE, the order dated July 6, 1989, is AFFIRMED and the petition DENIED, with
costs against the petitioner.
It is the character of the principal relief sought that appears essential, in this
connection. Where such principal relief is to be granted under labor legislation or SO ORDERED.
a collective bargaining agreement, the case should fall within the jurisdiction of
the Labor Arbiter and the NLRC, even though a claim for damages might be Narvasa (Chairman), Griño-Aquino and Medialdea, JJ., concur.
asserted as an incident to such claim.

x x x           x x x          x x x

Where the claim to the principal relief sought is to be resolved not by reference
to the Labor Code or other labor relations statute or a collective bargaining SECOND DIVISION
agreement but by the general civil law, the jurisdiction over the dispute belongs
G.R. No. L-58877 March 15, 1982
to the regular courts of justice and not to the Labor Arbiter and the NLRC. In
such situations, resolution of the dispute requires expertise, not in labor PEPSI-COLA BOTTLING COMPANY, COSME DE ABOITIZ, and ALBERTO M.
management relations nor in wage structures and other terms and conditions of DACUYCUY, petitioners, vs.
employment, but rather in the application of the general civil law. Clearly, such HON. JUDGE ANTONIO M. MARTINEZ, in his official capacity, and ABRAHAM
claims fall outside the area of competence or expertise ordinarily ascribed to TUMALA, JR., respondents.
Labor Arbiters and the NLRC and the rationale for granting jurisdiction over such
claims to these agencies disappears. ESCOLIN, J.:
x x x           x x x          x x x This petition for certiorari, prohibition and mandamus raises anew the legal question often
brought to this Court: Which tribunal has exclusive jurisdiction over an action filed by an
While paragraph 3 above refers to "all money claims of workers," it is not employee against his employer for recovery of unpaid salaries, separation benefits and
necessary to suppose that the entire universe of money claims that might be damages — the court of general jurisdiction or the Labor Arbiter of the National Labor
asserted by workers against their employers has been absorbed into the original Relations Commission [NLRC]?
and exclusive jurisdiction of Labor Arbiters.
The facts that gave rise to this petition are as follows:
x x x           x x x          x x x
On September 19, 1980, respondent Abraham Tumala, Jr. filed a complaint in the Court
For it cannot be presumed that money claims of workers which do not arise out of First Instance of Davao, docketed as Civil Case No. 13494, against petitioners Pepsi-
of or in connection with their employer-employee relationship, and which would Cola Bottling Co., Inc., its president Cosme de Aboitiz and other company officers. Under
therefore fall within the general jurisdiction of the regular courts of justice, were the first cause of action, the complaint averred inter alia that Tumala was a salesman of
intended by the legislative authority to be taken away from the jurisdiction of the company in Davao City from 1977 up to August 21, 1980; that in the annual
the courts and lodged with Labor Arbiters on an exclusive basis. The Court, "Sumakwel" contest conducted by the company in 1979, Tumala was declared winner of
therefore, believes and so holds that the 'money claims of workers" referred to the "Lapu-Lapu Award" for his performance as top salesman of the year, an award which
in paragraph 3 of Article 217 embraces money claims which arise out of or in entitled him to a prize of a house and lot; and that petitioners, despite demands, have
connection with the employer- employee relationship, or some aspect or unjustly refused to deliver said prize Under the second cause of action, it was alleged that
incident of such relationship. Put a little differently, that money claims of on August 21, 1980, petitioners, "in a manner oppressive to labor" and "without prior
workers which now fall within the original and exclusive jurisdiction of Labor clearance from the Ministry of Labor", "arbitrarily and ilegally" terminated his
Arbiters are those money claims which have some reasonable causal connection employment. He prayed that petitioners be ordered, jointly and severally, to deliver his
with the employer-employee relationship (Ibid.). prize of house and lot or its cash equivalent, and to pay his back salaries and separation
benefits, plus moral and exemplary damages, attorney's fees and litigation expenses. He
The case now before the Court involves a complaint for damages for malicious
did not ask for reinstatement.
prosecution which was filed with the Regional Trial Court of Leyte by the employees of the
defendant company. It does not appear that there is a "reasonable causal connection" Petitioners moved to dismiss the complaint on grounds of lack of jurisdiction and cause of
between the complaint and the relations of the parties as employer and employees. The action. Petitioners further alleged that Tumala was not entitled to the "Sumakwel" prize
complaint did not arise from such relations and in fact could have arisen independently of for having misled the company into declaring him top salesman for 1979 through various
an employment relationship between the parties. No such relationship or any unfair labor deceitful and fraudulent manipulations and machinations in the performance of his duties
practice is asserted. What the employees are alleging is that the petitioners acted with as salesman and depot in-charge of the bottling company in Davao City, which
bad faith when they filed the criminal complaint which the Municipal Trial Court said was manipulations consisted of "unremitted cash collections, fictitious collections of trade

Page 53 of 100
accounts, fictitious loaned empties, fictitious product deals, uncollected loaned empties, Article 217 of the Labor Code words amended by P.D. 1367, which was promulgated on
advance sales confirmed as fictitious, and route shortages which resulted to the damage May 1, 1978, the full text of which is quoted as follows:
and prejudice of the bottling company in the amount of P381,851.76." The alleged
commission of these fraudulent acts was also advanced by petitioners to justify Tumala's SECTION 1. Paragraph [a] of Art, 217 of the Labor Code as amended is hereby
dismissal. further amended to read as follows:

The court below, sustaining its jurisdiction over the case, denied the motion for [a] The Labor Arbiters shall have exclusive jurisdiction hear and decide the
reconsideration. Hence the present recourse. following cases involving all workers, whether agricultural or non-agricultural:

We rule that the Labor Arbiter has exclusive jurisdiction over the case. 1] Unfair labor practice cases;

Jurisdiction over the subject matter in a judicial proceeding is conferred by the sovereign 2] Unresolved issues in collective bargaining, including those which
authority which organizes the court; and it is given only by law. 1 Jurisdiction is never involve wages, hours of work, and other terms conditions of
presumed; it must be conferred by law in words that do not admit of doubt. 2 employment; and

Since the jurisdiction of courts and judicial tribunals is derived exclusively from the 3] All other cases arising from employer-employee relations duly
statutes of the forum, the issue efore Us should be resolved on the basis of the law or indorsed by the Regional Directors in accordance with the provisions of
statute now in force. We find that law in Presidential Decree 1691 which took effect on this Code.
May 1, 1980, Section 3 of which reads as follows:
Provided, that the Regional Directors shall not indorse and Labor Arbiters shall
SEC. 3. Article 217, 222 and 262 of Book V of the Labor Code are hereby not entertain claims for moral or other forms of damages.
amended to read as follows:
It will be noted that paragraphs 3 and 5 of Article 217 were deleted from the text of the
Article 217. Jurisdiction of Labor Arbiters and the Commission. — The Labor above decree and a new provision incorporated therein, to wit: "Provided that the
Arbiters shall have the original and exclusive jurisdiction to hear and decide the Regional Directors shall not indorse and Labor Arbiters shall not en certain claims for
following cases involving all workers, whether agricultural or non-agricultural: moral or other forms of damages." This amendatory act thus divested the Labor Arbiters
of their competence to pass upon claims for damages by employees against their
1. Unfair labor practice cases; employers.

2. Unresolved issues in collective bargaining, including those that involve waged However, on May 1, 1980, Article 217, as amended by P.D. 1367, was amended anew by
hours of work and other terms and conditions of employment; P.D. 1691. This last decree, which is a verbatim reproduction of the original test of Article
217 of the Labor Code, restored to the Labor Arbiters of the NLRC exclusive jurisdiction
3. All money claims of workers, including those based on non-payment or over claims, money or otherwise, arising from employer-employee relations, except those
underpayment of wages, overtime compensation, separation pay and other expressly excluded therefrom.
benefits provided by law or appropriate agreement, except claims for
employees' compensation, social security, medicare and maternity benefits; In sustaining its jurisdiction over the case at bar, the respondent court relied on Calderon
vs. Court of Appeals 4 , where We ruled that an employee's action for unpaid salaries,
4. Cases involving household services; and alowances and other reimbursable expenses and damages was beyond the periphery of
the jurisdictional competence of the Labor Arbiters. Our ruling in Calderon, however, no
5. All other claims arising from employer-employee relations, unless expressly longer applaies to this case because P.D. 1367, upon which said decision was based, had
excluded by this Code. already been superceded by P.D. 1691. As heretofore stated, P.D. 1691 restored to the
Labor Arbiters their exlcusive jurisdiction over said classes of claims.
Under paragraphs 3 and 5 of the above Presidential Decree, the case is exclusively
cognizable by the Labor Arbiters of the National Labor Relations Commission. Respondent Tumala maintains that his action for delivery of the house and lot, his prize
as top salesman of the company for 1979, is a civil controversy triable exclusively by the
It is to be noted that P.D. 1691 is an exact reproduction of Article 217 of the Labor Code court of the general jurisdiction. We do not share this view. The claim for said prize
(P.D. 442), which took effect on May 1, 1974. In Garcia vs. Martinez 3, an action filed on unquestionably arose from an employer-employee relation and, therefore, falls within the
August 2, 1976 in the Court of First Instance of Davao by a dismissed employee against coverage of par. 5 of P.D. 1691, which speaks of "all claims arising from employer-
his employer for actual, moral and exemplary damages, We held that under Article 217 of employee relations, unless expressly excluded by this Code." Indeed, Tumala would not
the Labor Code, the law then in force, the case was within the exclusive jurisdiction of the have qualitfied for the content, much less won the prize, if he was not an employee of the
Labor Arbiters and the National Labor Relations Commission [NLRC]. This Court, per company at the time of the holding of the contest. Besides, the cause advanced by
Justice Aquino, rational this holding thus: petitioners to justify their refusal to deliver the prize—the alleged fraudulent
manipulations committed by Tumala in connection with his duties as salesman of the
The provisions of paragraph 3 and 5 of Article 217 are broad and comprehensive
company—involves an inquiry into his actuations as an employee.
enough to cover Velasco's [employee's] claim for damages allegedly arising
from his unjustified dismissal by Garcia [employer]. His claim was a Besides, to hold that Tumala's claim for the prize should be passed upon by the regular
consequence of the termination of their employer-employee relations [Compare court of justice, independently and separately from his claim for back salaries, retirement
with Ruby Industrial Corporation vs. Court of First Instance of Manila, L- 38893, benefits and damages, would be to sanction split juridiction and multiplicity of suits which
August 31, 1977, 78 SCRA 499]. are prejudicial to the orderly administration of justice.

Page 54 of 100
One last point. Petitioners content that Tumala has no cause of action to as for back
salaries and damages because his dimissal was authorized by the Regional Director of the
MInistry of Labor. This question calls for the presentaiton of evidence and the same may
well be entilated before the labor Arbiter who has jurisdiction over the case. Besides, the
issue raised is not for Us to determine in this certiorari proceeding. The extraordinary
remedy of certiorari proceeding. The extraordinary remedy of certiorari offers only a
limited form of review and its principal function is to keep an inferior tribunal within its
jurisdiction. 5

WHEREFORE, the petition is granted, and respondent judge is hereby directed to dismiss
Civil Case No. 13494, without prejudice to the right of respondent Tumala to refile the
same with the Labor Arbiter. No costs.

SO ORDERED.

Barredo (Chairman), Concepcion, Jr., De Castro and Ericta, JJ., concur.

Abad Santos, J., took no part.

Separate Opinions

AQUINO, J., concurring:

I concur. Under Presidential Decree No. 1691, which took effect on May 1, 1980 and
which amended article 217 of the Labor Code by nullifying the amendment intorduced by
Presidential Decree No. 1367 (which took effect on May 1, 1978), that Labor Arbiters shall
not etertain claims for moral or other forms of damages," such claims may now be passed
upon by Labor Arbiters just as they had juristiction over such claims when the Labor Code
took effect on October 1, 1974. (Garcia vs. Martinez, L-47806-07, August 3, 1978, 84
SCRA 577, reconsidered in Resolution of May 28, 1979, 90 SCRA 331; Bengzon vs.
Inciong, L-48706-07, June 29, 1979, 91 SCRA 248; Caderon vs. Amor, et al. and Court of
Appeals, G.R. No. 52235, October 28, 1980, 100 SCRA 459 and Abad vs. Philippine
American General Ins. Co., Inc., G.R. No. 50563, October 30, 1981).

Page 55 of 100
 FIRST DIVISION ... In pursuance (of) defendant's determination to oppress plaintiff and cause
further loss, irreparable injury, prejudice and damage, (D.M. Transit) in bad
G.R. No. 72644 December 14, 1987 faith and with malice persuaded other firms (California Transit, Pascual Lines,
De Dios Transit, Negrita Corporation, and MD Transit) not to employ (appellant)
ALFREDO F. PRIMERO, petitioner, vs. in any capacity after he was already unjustly dismissed by said defendant ...
INTERMEDIATE APPELLATE COURT and DM TRANSIT, respondents. (paragraph 8 of plaintiff's complaint).
NARVASA, J.: These companies with whom appellant applied for a job called up the D.M.
Transit Office (which) ... told them ... that they should not accept (appellant)
The question on which the petitioner's success in the instant appeal depends, and to because (he) was dismissed from that Office.
which he would have us give an affirmative answer, is whether or not, having recovered
separation pay by judgment of the Labor Arbiter — which held that he had been fired by Primero instituted proceedings against DM with the Labor Arbiters of the Department of
respondent DM Transit Corporation without just cause — he may subsequently recover Labor, for illegal dismissal, and for recovery of back wages and reinstatement. It is not
moral damages by action in a regular court, upon the theory that the manner of his clear from the record whether these proceedings consisted of one or two actions
dismissal from employment was tortious and therefore his cause of action was separately filed. What is certain is that he withdrew his claims for back wages and
intrinsically civil in nature. 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
Petitioner Primero was discharged from his employment as bus driver of DM Transit tortious acts, breach of employment contract ... and consequent effects (thereof ). 2
Corporation (hereafter, simply DM) in August, 1974 after having been employed therein
for over 6 years. The circumstances attendant upon that dismissal are recounted by the In any case, after due investigation, the Labor Arbiter rendered judgment dated January
Court of Appeals 1 as follows: 24, 1977 ordering DM to pay complainant Primero P2,000.00 as separation pay in
accordance with the Termination Pay Law. 3 The judgment was affirmed by the National
Undisputably, since August 1, 1974, appellee's bus dispatcher did not assign any Labor Relations Commission and later by the Secretary of Labor, the case having been
bus to be driven by appellant Primero. No reason or cause was given by the concluded at this level on March 3, 1978. 4
dispatcher to appellant for not assigning a bus to the latter for 23 days (pp. 6-
14, 21-22, tsn, May 15, 1979). Under the provisions of the Labor Code in force at that time, Labor Arbiters had
jurisdiction inter alia over —
Also, for 23 days, appellant was given a run-around from one management
official to another, pleading that he be allowed to work as his family was in dire 1) claims involving non-payment or underpayment of wages, overtime
need of money and at the same time inquiring (why) he was not allowed to compensation, social security and medicare benefits, and
work or drive a bus of the company. Poor appellant did not only get negative
results but was given cold treatment, oftentimes evaded and given confusing 2) all other cases or matters arising from employer-employee relations, unless
information, or ridiculed, humiliated, or sometimes made to wait in the offices of otherwise expressly excluded. 5
some management personnel of the appellee (pp. 2-29, tsn, May 15, 1979).
And we have since held that under these "broad and comprehensive" terms of the law,
(The) General Manager and (the) Vice-President and Treasurer ... wilfully and Labor Arbiters possessed original jurisdiction over claims for moral and other forms of
maliciously made said appellant ... seesaw or ... go back and forth between damages in labor disputes. 6
them for not less than ten (10) times within a period of 23 days ... but (he) got
negative results from both corporate officials. Worse, on the 23rd day of his The jurisdiction of Labor Arbiters over such claims was however removed by PD 1367,
ordeal appellant was suddenly told by General Manager Briones to seek effective May 1, 1978, which explicitly provided that "Regional Directors shall not indorse
employment with other bus companies because he was already dismissed from and Labor Arbiters shall not entertain claims for moral or other forms of damages." 7
his job with appellee (without having been) told of the cause of his hasty and
capricious dismissal ... (pp. 8, 11-13, 25, tsn, May 15, 1979). 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
Impelled to face the harsh necessities of life as a jobless person and worried by employment contract, but also by the oppressive and inhuman, and consequently
his immediate need for money, appellant pleaded with Corporate President tortious, acts of his employer and its officers antecedent and subsequent to his dismissal
Demetrio Munoz, Jr. for his reinstatement and also asked P300.00 as financial from employment without just cause. 8
assistance, but the latter told the former that he (Munoz, Jr.) will not give him
even one centavo and that should appellant sue him in court, then that will be While this action was pending in the CFI, the law governing the Labor Arbiters' jurisdiction
the time President Munoz, Jr. will pay him, if Munoz, Jr. loses the case x x (pp. was once again revised. The amending act was PD 1691, effective May 1, 1980. It
21-22, tsn, May 15, 1979). 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
Appellant also advised (the) President of the oppressive, anti-social and we have had occasion to declare in several cases, it restored the principle that "exclusive
inhumane acts of subordinate officers ... (but) Munoz, Jr. did nothing to resolve and original jurisdiction for damages would once again be vested in labor arbiters;"
appellant's predicament and ... just told the latter to go back ... to ... Briones, eliminated "the rather thorny question as to where in labor matters the dividing line is to
who insisted that appellant seek employment with other bus firms in Metro be drawn between the power lodged in an administrative body and a court;' " and, "in the
Manila ... (but) admitted that the appellant has not violated any company rule interest of greater promptness in the disposition of labor matters, ... spared (courts of)
or regulation ... (pp. 23-26, tsn, May 15, 1979). 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 of disputes or
controversies arising from employer-employee relations." 9 Parenthetically, there was still

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another amendment of the provision in question which, however, has no application to attended by bad faith or fraud, or was oppressive to labor, or done in a manner contrary
the case at bar. The amendment was embodied in B.P. Blg. 227, effective June 1, to morals, good customs, or public policy; and, of course, that social humiliation,
1982. 10 wounded feelings, grave anxiety, etc., resulted therefrom. 17

On August 11, 1980 the Trial Court rendered judgment dismissing the complaint on the It is clear that the question of the legality of the act of dismissal is intimately related to
ground of lack of jurisdiction, for the reason that at the time that the complaint was filed. the issue of the legality of the manner by which that act of dismissal was performed. But
on August 17, 1978, the law — the Labor Code as amended by PD 1367, eff. May 1, 1978 while the Labor Code treats of the nature of, and the remedy available as regards the first
— conferred exclusive, original jurisdiction over claims for moral or other damages, not — the employee's separation from employment — it does not at all deal with the second
on ordinary courts, but on Labor Arbiters. — the manner of that separation — which is governed exclusively by the Civil Code. In
addressing the first issue, the Labor Arbiter applies the Labor Code; in addressing the
This judgment was affirmed by the Intermediate Appellate Court, by Decision rendered on second, the Civil Code. And this appears to be the plain and patent intendment of the law.
June 29, 1984. This is the judgment now subject of the present petition for review For apart from the reliefs expressly set out in the Labor Code flowing from illegal
on certiorari. The decision was reached by a vote of 3 to 2. The dissenters, placing dismissal from employment, no other damages may be awarded to an illegally dismissed
reliance on certain of our pronouncements, opined that Primero's causes of action were employee other than those specified by the Civil Code. Hence, the fact that the issue-of
cognizable by the courts, that existence of employment relations was not alone decisive whether or not moral or other damages were suffered by an employee and in the
of the issue of jurisdiction, and that such relations may indeed give rise to " civil" as affirmative, the amount that should properly be awarded to him in the circumstances-is
distinguished from purely labor disputes, as where an employer's right to dismiss his determined under the provisions of the Civil Code and not the Labor Code, obviously was
employee is exercised tortiously, in a manner oppressive to labor, contrary to morals, not meant to create a cause of action independent of that for illegal dismissal and thus
good customs or public policy. 11 place the matter beyond the Labor Arbiter's jurisdiction.

Primero has appealed to us from this judgment of the IAC praying that we overturn the Thus, an employee who has been illegally dismissed (i.e., discharged without just cause
majority view and sustain the dissent. or being accorded due process), in such a manner as to cause him to suffer moral
damages (as determined by the Civil Code), has a cause of action for reinstatement and
Going by the literal terms of the law, it would seem clear that at the time that Primero recovery of back wages and damages. When he institutes proceedings before the Labor
filed his complaints for illegal dismissal and recovery of backwages, etc. with the Labor Arbiter, he should make a claim for all said reliefs. He cannot, to be sure, be permitted to
Arbiter, the latter possessed original and exclusive jurisdiction also over claims for moral prosecute his claims piecemeal. He cannot institute proceedings separately and
and other forms of damages; this, in virtue of Article 265 12 of PD 442, otherwise known contemporaneously in a court of justice upon the same cause of action or a part thereof.
as the Labor Code, effective from May 1, 1974. In other words, in the proceedings before He cannot and should not be allowed to sue in two forums: one, before the Labor Arbiter
the Labor Arbiter, Primero plainly had the right to plead and prosecute a claim not only for reinstatement and recovery of back wages, or for separation pay, upon the theory that
for the reliefs specified by the Labor Code itself for unlawful termination of employment, his dismissal was illegal; and two, before a court of justice for recovery of moral and
but also for moral or other damages under the Civil Code  arising from or connected with other damages, upon the theory that the manner of his dismissal was unduly injurious, or
that termination of employment. And this was the state of the law when he moved for the tortious. This is what in procedural law is known as splitting causes of action, engendering
dismissal of his claims before the Labor Arbiter, for reinstatement and recovery of back multiplicity of actions. It is against such mischiefs that the Labor Code amendments just
wages, so that he might later file a damage suit "in a civil court which has exclusive discussed are evidently directed, and it is such duplicity which the Rules of Court regard
jurisdiction over his complaint ... founded on tortious acts, breach of employment as ground for abatement or dismissal of actions, constituting either litis pendentia (auter
contract ... and consequent effects (thereof)." 13 action pendant) or res adjudicata, as the case may be. 18 But this was precisely what
Primero's counsel did. He split Primero's cause of action; and he made one of the split
The legislative intent appears clear to allow recovery in proceedings before Labor Arbiters parts the subject of a cause of action before a court of justice. Consequently, the
of moral and other forms of damages, in all cases or matters arising from employer- judgment of the Labor Arbiter granting Primero separation pay operated as a bar to his
employee relations. This would no doubt include, particularly, instances where an subsequent action for the recovery of damages before the Court of First Instance under
employee has been unlawfully dismissed. In such a case the Labor Arbiter has jurisdiction the doctrine of res judicata, The rule is that the prior "judgment or order is, with respect
to award to the dismissed employee not only the reliefs specifically provided by labor to the matter directly adjudged or as to any other matter that could have been raised in
laws, but also moral and other forms of damages governed by the Civil Code. Moral relation thereto, conclusive between the parties and their successors in interest by title
damages would be recoverable, for example, where the dismissal of the employee was subsequent to the commencement of the action or special proceeding, litigating for the
not only effected without authorized cause and/or due process for which relief is granted same thing and under the same title and in the same capacity. 19
by the Labor Code —  but was attended by bad faith or fraud, or constituted an act
oppressive to labor, or was done in a manner contrary to morals, good customs or public We are not unmindful of our previous rulings on the matter cited in the dissent to the
policy 14 — for which the obtainable relief is determined by the Civil Code 15 (not the decision of the Court of Appeals subject of the instant petition, 20 notably, Quisaba v. Sta
Labor Code). Stated otherwise, if the evidence adduced by the employee before the Labor Ines-Melale Veneer & Plywood Inc., where a distinction was drawn between the right of
Arbiter should establish that the employer did indeed terminate the employee's services the employer to dismiss an employee, which was declared to be within the competence of
without just cause or without according him due process, the Labor Arbiter's judgment labor agencies to pass upon, and the "manner in which the right was exercised and the
shall be for the employer to reinstate the employee and pay him his back wages or, effects flowing therefrom," declared to be a matter cognizable only by the regular courts
exceptionally, for the employee simply to receive separation pay. These are reliefs because "intrinsically civil." 21 We opine that it is this very distinction which the law has
explicitly prescribed by the Labor Code. 16 But any award of moral damages by the Labor sought to eradicate as being so tenuous and so difficult to observe, 22 and, of course, as
Arbiter obviously cannot be based on the Labor Code but should be grounded on the Civil herein pointed out, as giving rise to split jurisdiction, or to multiplicity of actions, "a
Code. Such an award cannot be justified solely upon the premise (otherwise sufficient for situation obnoxious to the orderly administration of justice. 23 Actually we merely reiterate
redress under the Labor Code) that the employer fired his employee without just cause or in this decision the doctrine already laid down in other cases (Garcia v. Martinez, 84 SCRA
due process. Additional facts must be pleaded and proven to warrant the grant of moral 577; Ebon v. de Guzman, 13 SCRA 52; Bengzon v. Inciong, 91 SCRA 248; Pepsi-Cola
damages under the Civil Code, these being, to repeat, that the act of dismissal was Bottling Co. v. Martinez, 112 SCRA 578; Aguda v. Vallejos, 113 SCRA 69; Getz v. C.A.,

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116 SCRA 86; Cardinal Industries v. Vallejos, 114 SCRA 471; Sagmit v. Sibulo, 133 SCRA
359) to the effect that the grant of jurisdiction to the Labor Arbiter by Article 217 of the
Labor Code is sufficiently comprehensive to include claims for moral and exemplary
damages sought to be recovered from an employer by an employee upon the theory of
his illegal dismissal. Rulings to the contrary are deemed abandoned or modified
accordingly.

WHEREFORE, the petition is DISMISSED, without pronouncement as to costs.

Teehankee, C.J., Cruz, Paras,  *  and Gancayco, JJ., concur.

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 FIRST DIVISION portion. 11 Petitioner imputes bad faith and fraud on the part of Nabasa because in
applying for and causing the titling in his name of Lot 1, Block 5, Psu-154953, Nabasa
[G.R. No. 84831. June 20, 2001.] represented himself to be the actual and lawful possessor of the entire Lot 1, Block 5,
including petitioner Abejaron’s 118-square meter portion despite knowledge of Abejaron’s
PACENCIO ABEJARON, as represented by his Attorney-in-Fact, ALEJANDRO actual occupation and possession of said portion. 12
ABEJARON, Petitioner, v. FELIX NABASA and the COURT OF
APPEALS, Respondents. On September 24, 1974, Nabasa was issued Original Certificate of Title No. P-4140
pursuant to Free Patent No. (XI-4) 2877 covering Lot 1, Block 5, Psu-154953. As the title
DECISION* included petitioner Abejaron’s 118-square meter portion of the lot, his son, Alejandro
Abejaron, representing Matilde Abejaron (petitioner Abejaron’s wife), filed a protest with
PUNO, J.: the Bureau of Lands, Koronadal, South Cotabato against Nabasa’s title and application.
The protest was dismissed on November 22, 1979 for failure of Matilde and Alejandro to
With the burgeoning population comes a heightened interest in the limited land resources
attend the hearings. 13 Alejandro claims, however, that they did not receive notices of
especially so if, as in the case at bar, one’s home of many years stands on the land in
the hearings. Alejandro filed a motion for reconsideration dated January 10, 1980.
dispute. It comes as no surprise therefore that while this case involves a small parcel of
Alejandro also filed a notice of adverse claim on January 14, 1980. Subsequently, he
land, a 118-square meter portion of Lot 1, Block 5, Psu-154953 in Silway, General Santos
requested the Bureau of Lands to treat the motion as an appeal considering that it was
City, the parties have tenaciously litigated over it for more than twenty years.
filed within the 60-day reglementary period. The motion for reconsideration was endorsed
Petitioner Abejaron filed this petition for review on certiorari to annul the respondent and forwarded by the District Land Office XI-3 of the Bureau of Lands in Koronadal,
court’s Decision dated April 26, 1988 and Resolution dated July 12, 1988 reversing the Cotabato to the Director of Lands in Manila on November 24, 1981. 14 But because the
trial court’s decision and declaring respondent Nabasa the owner of the subject lot. appeal had not been resolved for a prolonged period for unknown reasons, petitioner
Abejaron filed on March 12, 1982 an action for reconveyance with damages against
The following facts spurred the present controversy: respondent Nabasa before Branch 22, Regional Trial Court of General Santos City. 15 On
May 10, 1982, petitioner filed a notice of lis pendens. 16
Petitioner Abejaron avers that he is the actual and lawful possessor and claimant of a
118-square meter portion of a 175-square meter residential lot in Silway, General Santos Abner Lagsub, geodetic engineer, testified for the petitioner. Lagsub stated that on March
City described as "Block 5, Lot 1, Psu-154953, bounded on the North by Road, on the 30, 1980, Alejandro Abejaron hired him to relocate Lot 1, Block 5, Psu-154953, the land
South by Lot 2 of the same Psu, on the East by Felix Nabasa, and on the West by Road." in controversy. He surveyed the lot measuring 175 square meters. Fifty-seven (57)
1 In 1945, petitioner Abejaron and his family started occupying the 118-square meter square meters of Lot 1 and a portion of the adjoining Lot 3 were occupied by Nabasa’s
land. At that time, the land had not yet been surveyed. They fenced the area and built house. This portion was fenced partly by hollow blocks and partly by bamboo. On the
thereon a family home with nipa roofing and a small store. In 1949, petitioner improved remaining 118 square meters stood a portion of petitioner Abejaron’s house and two
their abode to become a two-storey house measuring 16 x 18 feet or 87.78 square coconut trees near it, and his store. Abejaron’s 118-square meter portion was separated
meters made of round wood and nipa roofing. 2 This house, which stands to this day, from Nabasa’s 57-square meter part by Abejaron’s fence made of hollow blocks. Both
occupies a portion of Lot 1, Block 5, Psu-154953 and a portion of the adjoining Lot 2 of Nabasa’s and Abejaron’s houses appeared more than twenty years old while the coconut
the same Psu. Lot 2 belongs to petitioner’s daughter, Conchita Abejaron-Abellon. In 1950, trees appeared about 25 years old.
the small store was destroyed and in its stead, petitioner Abejaron built another store
which stands up to the present. In 1951, he planted five coconut trees on the property in Back in 1971, Lagsub conducted a subdivision survey on Psu-154953. He was then hired
controversy. Petitioner’s wife, Matilde Abejaron, harvested coconuts from these trees. 3 by the Silway Neighborhood Association to conduct the survey for purposes of allocating
Petitioner Abejaron also planted banana and avocado trees. He also put up a pitcher lots to the members of the association, among whom were respondent Nabasa and
pump. 4 All this time that the Abejaron’s introduced these improvements on the land in petitioner Abejaron. When the 1971 survey was conducted, both the Abejarons and
controversy, respondent Nabasa did not oppose or complain about the improvements. Nabasa were already occupying their respective 118 and 57 square meter portions of Lot
1, Block 5. Nabasa and Matilde Abejaron, representative of petitioner, were present
Knowing that the disputed land was public in character, petitioner declared only his during the survey.
house, and not the disputed land, for taxation purposes in 1950, 1966, 1976, and 1978. 5
The last two declarations state that petitioner Abejaron’s house stands on Lots 1 and 2, Respondent Nabasa had a different story to tell. He contends that he had been residing
Block 5, Psu 154953. 6 Abejaron paid taxes on the house in 1955, 1966, and 1981. 7 on a 12 x 15 meter or 180-square meter public land in Silway, General Santos City since
1945. He admits that petitioner Abejaron was already residing in Silway when he arrived
Petitioner stated that beginning 1955, respondent Nabasa resided on the remaining 57- there. Nabasa constructed a house which stands to this day and planted five coconut
square meter portion of Lot 1, Block 5, Psu-154953. 8 Nabasa built his house about four trees on this 180-square meter land, but only two of the trees survived. Nabasa never
(4) meters away from petitioner Abejaron’s house. Beatriz Gusila, a neighbor of the harvested coconuts from these trees as petitioner Abejaron claims to own them and
Abejarons and the Nabasas confirmed that when she arrived in Silway in 1949, Nabasa harvests the coconuts. In many parts of respondent Nabasa’s testimony, however, he
was not yet residing there while Abejaron was already living in their house which stands declared that he started occupying the 180-square meter area in 1976.
to this day.
Nabasa avers that previously, he and petitioner Abejaron were in possession of portions
Before 1974, employees of the Bureau of Lands surveyed the area in controversy. of Lot 2, Psu-154953. This lot was subsequently surveyed and divided into smaller lots
Abejaron merely watched them do the survey 9 and did not thereafter apply for title of with the area of petitioner Abejaron designated as Lot 2, Block 5, Psu-154953 measuring
the land on the belief that he could not secure title over it as it was government property. one hundred eighty (180) square meters, while his was designated as Lot 1, Block 5, Psu-
10 Without his (Abejaron) knowledge and consent, however, Nabasa "clandestinely, 154953 with an area of one hundred seventy five (175) square meters.
willfully, fraudulently, and unlawfully applied for and caused the titling in his name" of the
entire Lot 1, Block 5, Psu-154953, including petitioner Abejaron’s 118-square meter Instead of applying for free patent over his Lot 2, petitioner Abejaron gave this lot to his
daughter Conchita Abejaron-Abellon and allowed her to file the application with the

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District Land Office XI-4, Bureau of Lands, Koronadal, South Cotabato. Conchita secured defendant Felix Nabasa is hereby ordered to reconvey and execute a registerable
Free Patent No. (XI-4)-3293 over Lot 2. Pursuant to this, she was issued Original document in favor of plaintiff Pacencio Abejaron, Filipino, married and a resident of
Certificate of Title No. P-4420. On April 27, 1981, Conchita’s title was transcribed in the Silway, General Santos City, his heirs, successors and assigns over an area of one
Registration Book of General Santos City. hundred eighteen (118) square meters of Lot No. 1, Block 5, Psu-154953, situated at
Silway, General Santos City, on the Western portion of said lot as shown in the sketch
Respondent Nabasa, on the other hand, filed an application for Free Patent over Lot 1, plan, Exhibit "R", and the remaining portion of 57 square meters of said lot to be retained
Block 5, Psu-154953 with the District Land Office No. XI-4, Bureau of Lands, Koronadal, by defendant Felix Nabasa;
South Cotabato. While the application was pending, petitioner Abejaron forcibly
encroached upon the northern and southwestern portion of Lot 1, Block 5, Psu-159543. 2. Should Felix Nabasa fails (sic) to do so, upon the finality of this judgment, the Clerk of
Abejaron fenced the disputed 118-square meter portion of Lot 1 and despite Nabasa’s Court shall executed (sic) it in the name of Felix Nabasa, widower, and will have the same
opposition, constructed a store near the road. Petitioner Abejaron then transferred his old effect as if executed by the latter and the Register of Deeds, General Santos City, is
house constructed on Lot 2, Block 5, Psu-154953 to a portion of the disputed 118-square hereby directed to issue New Transfer Certificate of Title to Alejandro Abejaron over 118
meter area. Petitioner’s daughter, Conchita, patentee and title holder of Lot 2, square meters of Lot No. 1, Block 5, Psu-154953, and New Transfer Certificate of Title
constructed her own house in Lot 2. over 57 square meters of same Lot No. 1, Block 5, Psu-154953, in favor of Felix Nabasa,
and ultimately to have OCT No. P-4140 of Felix Nabasa cancelled accordingly."
Free Patent No. (XI-4)-2877, covering Lot 1, Block 5, was issued to respondent Nabasa
on September 24, 1974. But before the patent could be transcribed on the Registration Respondent Nabasa’s motion for reconsideration having been denied, he appealed to the
Book of the Registrar of Deeds of General Santos City, the District Land Officer of District Court of Appeals. On April 26, 1988, the Court of Appeals rendered a decision in favor of
Land Office No. XI-4 recalled it for investigation of an administrative protest filed by the respondent Nabasa, viz:
petitioner. 19 The protest was given due course, but petitioner Abejaron or his
representative failed to appear in the hearings despite notice. ". . . the only basis for reconveyance is actual fraud. In this case, Abejaron failed to
substantiate the existence of actual fraud. . . There was no proof of irregularity in the
On November 22, 1979, the administrative protest was dismissed by the District Land issuance of title nor in the proceedings incident thereto nor was there a claim that fraud
Officer for failure of petitioner Abejaron or his representative to appear in the hearings intervened in the issuance of the title, thus, the title has become indefeasible (Frias v.
despite notice. Respondent Nabasa’s Free Patent No. (XI-4)-2877 was then re- Esquival, 67 SCRA 487). Abejaron was not able to establish his allegation that Nabasa
transmitted by the District Land Officer of District Land Office XI-4 to the Register of misrepresented his status of possession in his application for the title. . . In fact, in
Deeds, General Santos City, and the same was transcribed in the Registration Book of the Abejaron’s answer to Nabasa’s counterclaim, he said that Nabasa has been occupying the
Registry of Property of General Santos City on December 13, 1979. Original Certificate of area since 1950.
Title No. P-4140, covering Lot 1, Block 2, Psu-154953, was issued to respondent Nabasa.
Contrary to the finding of the court a quo, the Bureau of Lands conducted an ocular
On March 12, 1982, petitioner Abejaron filed against respondent Nabasa an action for inspection before the title was issued. This was confirmed by Abejaron himself (tsn,
reconveyance with damages seeking reconveyance of his 118-square meter portion of Lot January 19, 1984).
1, Block 5, Psu-154953.
x              x              x
During the trial, respondent Nabasa presented Abundio Guiral, his neighbor who had been
living since 1945 in Lot 3, Block 5, Psu-154953, adjoining Nabasa’s Lot 1. He testified that WHEREFORE, premises considered, the decision appealed from is hereby REVERSED and
when he arrived in Silway, petitioner Abejaron was already living there. Four months SET ASIDE and a new one entered declaring Felix Nabasa as the owner of the lot covered
after, Nabasa started residing in the area. Nabasa constructed a house, planted coconut by O.C.T. No. P-4140. Costs against Plaintiff-Appellee.
trees, and fenced his 12 x 15 meter area. Abejaron’s house in 1945 is still the same
house he lives in at present, but in 1977, it was jacked up and transferred from Lot 2 to SO ORDERED."
Lot 1, Block 5. Nabasa tried to prevent the transfer to no avail. The house was then
extended towards Lot 2. Petitioner Abejaron filed a motion for reconsideration of the Court of Appeals decision. On
July 22, 1988, the Court of Appeals rendered a resolution denying the motion for
On rebuttal, petitioner Abejaron presented two neighbors. One of them, Alejandra Doria, reconsideration for lack of merit. Hence, this petition for review on certiorari with the
started living in Silway in 1947. She testified that when she arrived in the neighborhood, following assignment of errors:
Abejaron’s fence as it now stands between the 57-square meter portion occupied by
Nabasa’s house and the 118-square meter area claimed by petitioner Abejaron was "I. THE HONORABLE COURT OF APPEALS ERRED IN NOT FINDING THAT ACTUAL FRAUD
already there. The other neighbor, Pacencia Artigo, also started living in Silway in 1947. WAS COMMITTED BY THE PRIVATE RESPONDENT AND PROVEN BY THE PETITIONER AND
She declared that the house of the Abejarons stands now where it stood in 1947. She also SUSTAINED BY THE TRIAL COURT WHEN PRIVATE RESPONDENT PROCURED THE TITLE IN
testified that the Abejarons previously had a store smaller than their present store. HIS NAME OF THE AREA OF THE LOT IN QUESTION, LOT 1, BLOCK 5, LOCATED AT
SILWAY, DADIANGAS, GENERAL SANTOS CITY.
On September 27, 1985, after trial on the merits, the trial court ruled in favor of
petitioner Abejaron, viz: II. THE HONORABLE COURT OF APPEALS ERRED IN CONCLUDING THAT THE LOT WHICH
BELONGS TO THE PETITIONER IS LOT 2 OF THE SAME BLOCK AND PSU, AND THAT THE
"WHEREFORE, IN VIEW OF ALL THE FOREGOING, this court hereby renders judgment as PETITIONER FORCIBLY ENTERED INTO LOT 1 OF THE SAME BLOCK AND PSU, AND
follows: FORCIBLY TRANSFERRED HIS OLD HOUSE FROM LOT 2 TO LOT 1 IS BASED ONLY ON THE
SELF-SERVING ALLEGATIONS OF THE PRIVATE RESPONDENT AND NOT SUPPORTED BY
1. Declaring the possession and occupancy of Pacencio Abejaron over 118 square meters ANY COMPETENT AND CONVINCING EVIDENCE.
of Lot No. 1, Block 5, Psu-154953 in good faith and thereby declaring the inclusion of 118
square meters of said lot in OCT No. P-4140 erroneous and a mistake, and for which,

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III. THE HONORABLE COURT OF APPEALS ERRED IN DISREGARDING THE FACT THAT the public domain, under a bona fide claim of acquisition of ownership, for at least thirty
PETITIONER HAS A CLEAR RIGHT OVER THE PROPERTY IN QUESTION BECAUSE HE HAS years immediately preceding the filing of the application for confirmation of title except
BEEN IN ACTUAL AND LAWFUL POSSESSION FOR SO MANY YEARS AND A CLAIMANT OF when prevented by war or force majeure. These shall be conclusively presumed to have
THE PROPERTY IN QUESTION." performed all the conditions essential to a Government grant and shall be entitled to a
certificate of title under the provisions of this Chapter." (Emphasis supplied)
We affirm the decision of the Court of Appeals.
Citing Susi v. Razon, 31 the Court interpreted this law, viz:
An action for reconveyance of a property is the sole remedy of a landowner whose
property has been wrongfully or erroneously registered in another’s name after one year ". . . where all the necessary requirements for a grant by the Government are complied
from the date of the decree so long as the property has not passed to an innocent with through actual physical possession openly, continuously, and publicly with a right to
purchaser for value. 25 The action does not seek to reopen the registration proceeding a certificate of title to said land under the provisions of Chapter VIII of Act No. 2874,
and set aside the decree of registration but only purports to show that the person who amending Act No. 926 (carried over as Chapter VIII of Commonwealth Act No. 141), the
secured the registration of the property in controversy is not the real owner thereof. 26 possessor is deemed to have already acquired by operation of law not only a right to a
Fraud is a ground for reconveyance. For an action for reconveyance based on fraud to grant, but a grant of the Government, for it is not necessary that a certificate of title be
prosper, it is essential for the party seeking reconveyance to prove by clear and issued in order that said grant may be sanctioned by the courts — an application therefor
convincing evidence his title to the property and the fact of fraud. 27 being sufficient under the provisions of Section 47 of Act No. 2874 (reproduced as Section
50, Commonwealth Act No. 141). If by a legal fiction, Valentin Susi had acquired the land
Petitioner Abejaron does not claim to own Lot 1, Block 5, Psu-154953. He in fact admits in question by grant of the State, it had already ceased to be of the public domain and
that he believed the land in dispute was public in character, thus he did not declare it for had become private property, at least by presumption, of Valentin Susi, beyond the
taxation purposes despite possession of it for a long time. Neither did he apply for title control of the Director of Lands. (Emphasis supplied)"
over it on the mistaken belief that he could not apply for title of a public land. In his
Complaint, he stated that respondent Nabasa’s fraudulent procurement of Free Patent No. The Mesina and Susi cases were cited in Herico v. Dar, 32 another action for cancellation
(XI-4)-2877 and OCT No. P-4140 over the disputed land deprived him not of ownership, of title issued pursuant to a free patent. Again, the Court ruled that under Section 48(b)
but of his "right to file the necessary application thereon with the authorities concerned" of the Public Land Act, as amended by Rep. Act No. 1942, with the plaintiff’s proof of
28 as long-time possessor of the land. occupation and cultivation for more than 30 years since 1914, by himself and by his
predecessor-in-interest, title over the land had vested in him as to segregate the land
Nonetheless, petitioner contends that an action for reconveyance is proper, viz: from the mass of public land. Thenceforth, the land was no longer disposable under the
Public Land Act by free patent. 33 The Court held, viz:
". . . for an action of reconveyance of a parcel of land to prosper, it is not necessary that
the proponent be the absolute owner thereof. It is enough that the proponent has an "As interpreted in several cases (Susi v. Razon, Et Al., 48 Phil. 424; Mesina v. Pineda Vda.
equitable right thereon. In the case at bar, the plaintiff had been in lawful, open, de Sonza, G.R. No. L-14722, May 25, 1960) when the conditions as specified in the
continuous and notorious possession, occupation and control in the concept of an owner foregoing provision are complied with, the possessor is deemed to have acquired, by
of a greater portion of the subject lot since 1945 and have (sic) thereby acquired an operation of law, a right to a grant, a government grant, without the necessity of a
equitable right thereon protected by law. Possession of public lands once occupation of certificate of title being issued. The land, therefore, ceases to be of public domain, and
the same is proven, as the herein plaintiff did, under claim of ownership constitutes a beyond the authority of the Director of Lands to dispose of. The application for
grant from the state (Republic v. Vera, 120 SCRA 210). A portion of the public land confirmation is a mere formality, the lack of which does not affect the legal sufficiency of
ceased to be public as soon as its claimant had performed all the conditions essential to a the title as would be evidenced by the patent and the Torrens title to be issued upon the
grant (Republic v. Villanueva, 114 SCRA. 875)." 29 strength of said patent." 34

Petitioner’s contention, buttressed by the Vera case and Chief Justice Teehankee’s dissent In citing Republic v. Villanueva, Et Al., 35 petitioner Abejaron relied on the dissenting
in the Villanueva case, is similar to the position taken by the plaintiff in Mesina v. Vda. de opinion of Chief Justice Teehankee. However, the en banc majority opinion in that case
Sonza, Et. Al. 30 In that case, plaintiff filed in the Court of First Instance of Nueva Ecija and in Manila Electric Company v. Bartolome, 36 departed from the doctrines enunciated
an action for cancellation of the original certificate of title procured by the defendant by in the Susi, Mesina, and Herico cases. Citing Uy Un v. Perez, 37 the Court ruled that "the
virtue of a homestead patent. The title covered a public land which she claimed to own right of an occupant of public agricultural land to obtain a confirmation of his title under
through public, open, and peaceful possession for more than thirty years. The law Sec. 48(b) of Com. Act. No. 141, as amended by Rep. Act No. 1942, is ‘derecho dominical
applicable in that case, which petitioner Abejaron apparently relies on in the case at bar, incoativo’ and that before the issuance of the certificate of title the occupant is not in the
is Sec. 48(b) of Commonwealth Act 141 or the Public Land Act, as amended by Republic juridical sense the true owner of the land since it still pertains to the State." 38
Act No. 1942, which took effect on June 22, 1957, viz:
The Court pointed out that the Villanueva and Meralco cases are different from the oft-
"SECTION 48. The following-described citizens of the Philippines, occupying lands of the cited Susi case as the latter involved a parcel of land possessed by a Filipino citizen since
public domain or claiming to own any such lands or an interest therein, but whose titles time immemorial, while the land in dispute in the Villanueva and Meralco cases were
have not been perfected or completed, may apply to the Court of First Instance (now sought to be titled by virtue of Sec. 48(b) of the Public Land Act, as amended. In
Regional Trial Courts) of the province where the land is located for confirmation of their explaining the nature of land possessed since time immemorial, the Court quoted Oh Cho
claims and the issuance of a certificate of title therefor, under the Land Registration Act v. Director of Lands, 39 viz:
(now Property Registration Decree), to wit:
"All lands that were not acquired from the Government, either by purchase or by grant,
x              x              x belong to the public domain. An exception to the rule would be any land that should have
been in the possession of an occupant and of his predecessors-in-interest since time
(b) Those who by themselves or through their predecessors in interest have been in open, immemorial, for such possession would justify the presumption that the land had never
continuous, exclusive, and notorious possession and occupation of agricultural lands of

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been part of the public domain or that it had been a private property even before the vested rights such as a land grant. More clearly stated, "Filipino citizens who by
Spanish conquest." themselves or their predecessors-in-interest have been, prior to the effectivity of P.D.
1073 on January 25, 1977, in open, continuous, exclusive and notorious possession and
In 1986, however, in Director of Lands v. Intermediate Appellate Court, Et Al., 40 this occupation of agricultural lands of the public domain, under a bona fide claim of
Court en banc recognized the strong dissent registered by Chief Justice Teehankee in the acquisition of ownership, for at least 30 years, or at least since January 24, 1947" may
Villanueva case and abandoned the Villanueva and Meralco ruling to revert to the Susi apply for judicial confirmation of their imperfect or incomplete title under Sec. 48(b) of
doctrine. Reiterating the Susi and Herico cases, the Court ruled: the Public Land Act.

"Nothing can more clearly demonstrate the logical inevitability of considering possession Having laid down the law applicable to the case at bar, i.e., Sec. 48(b) of the Public Land
of public land which is of character and duration prescribed by statute as the equivalent of Act, as amended by R.A. 1942, we now determine whether or not petitioner has acquired
express grant from the State than the dictum of the statute itself [Sec. 48(b)] that the title over the disputed land. In doing so, it is necessary for this Court to wade through the
possessor(s) ‘. . . shall be conclusively presumed to have performed all the conditions evidence on record to ascertain whether petitioner has been in open, continuous,
essential to a Government grant and shall be entitled to a certificate of title . . ..’ No proof exclusive and notorious possession and occupation of the 118-square meter disputed land
being admissible to overcome a conclusive presumption, confirmation proceedings would, for 30 years at least since January 24, 1947. It is axiomatic that findings of fact by the
in truth be little more than a formality, at the most limited to ascertaining whether the trial court and the Court of Appeals are final and conclusive on the parties and upon this
possession claimed is of the required character and length of time; and registration Court, which will not be reviewed or disturbed on appeal unless these findings are not
thereunder would not confer title, but simply recognize a title already vested. The supported by evidence or unless strong and cogent reasons dictate otherwise. 47 One
proceedings would not originally convert the land from public to private land, but only instance when findings of fact of the appellate court may be reviewed by this Court is
confirm such a conversion already effected by operation of law from the moment the when, as in the case at bar, the factual findings of the Court of Appeals and the trial court
required period of possession became complete." 41 (Emphasis supplied) are contradictory.

This is the prevailing rule as reiterated in the more recent case of Rural Bank of Petitioner claims that he started occupying the disputed land in 1945. At that time, he
Compostela v. Court of Appeals, a ponencia of now Chief Justice Davide, Jr., 42 viz: built a nipa house, a small store, and a fence made of wood to delineate his area. This
nipa house was improved in 1949 into a two-storey house. The small store was also made
"The rule under the latter (Section 48[b] of the Public Land Act, as amended by R.A. No. bigger in 1950. The wooden fence was also changed to a fence made of hollow blocks.
1942), is that when the conditions specified therein are complied with, the possessor is The two-storey house, bigger store, and hollow-block fence all stand to this day. In 1951,
deemed to have acquired, by operation of law, a right to a government grant, without petitioner planted coconut trees near his house. While the petitioner has shown continued
necessity of a certificate of title being issued, and the land ceases to be part of the public existence of these improvements on the disputed land, they were introduced later than
domain and beyond the authority of the Director of Lands." January 24, 1947. He has failed to establish the portion of the disputed land that his
original nipa house, small store and wooden fence actually occupied as of January 24,
The question brought to the fore, therefore, is whether or not petitioner Abejaron has 1947. In the absence of this proof, we cannot determine the land he actually possessed
satisfied the conditions specified in Sec. 48(b) of the Public Land Act, as amended by R.A. and occupied for thirty years which he may acquire under Sec. 48(b) of the Public Land
No. 1942. Sec. 48(b) has been further amended by P.D. No. 1073 which took effect on Act. Worthy of notice is the fact that the disputed land was surveyed, subdivided into and
January 25, 1977. Sec. 4 of the P.D. reads as follows: identified by lots only in the 1970’s. Therefore, prior to the survey, it would be difficult to
determine the metes and bounds of the land petitioner claims to have occupied since
"SECTION 4. The provision of Section 48(b) and Section 48(c), Chapter VIII, of the Public
1947 in the absence of specific and incontrovertible proof.
Land Act, are hereby amended in the sense that these provisions shall apply only to
alienable and disposable lands of the public domain which have been in open, continuous, The neighbors presented by the petitioner, namely Alejandra Doria, Pacencia Artigo, and
exclusive and notorious possession and occupation by the applicant himself or thru his Beatriz Gusila, could not also further his cause as both Doria and Artigo stated that they
predecessor-in-interest, under a bona fide claim of acquisition of ownership, since June started residing in Silway in 1947, without specifying whether it was on or prior to
12, 1945." January 24, 1947, while Gusila arrived in the neighborhood in 1949. While Doria testified
that there was a fence between Abejaron’s and Nabasa’s houses in 1947, she did not
Sec. 48(b) of the Public Land Act, as further amended by P.D. No. 1073, now reads: state that Abejaron’s 118-square meter area was enclosed by a fence which stands to this
day. This is confirmed by Geodetic Engineer Lagsub’s 1984 survey plan which shows that
"(b) Those who by themselves or through their predecessors-in-interest have been in
a fence stands only on one side of the 118-square meter area, the side adjacent to
open, continuous, exclusive and notorious possession and occupation of agricultural lands
Nabasa’s 57-square meter portion. Again, this poses the problem of determining the area
of the public domain, under a bona fide claim of acquisition or ownership, since June 12,
actually occupied and possessed by Abejaron at least since January 24, 1947.
1945, or earlier, immediately preceding the filing of the application for confirmation of
title, except when prevented by wars or force majeure. Those shall be conclusively Finally, as admitted by the petitioner, he has never declared the disputed land for
presumed to have performed all the conditions essential to a Government grant and shall taxation purposes. While tax receipts and tax declarations are not incontrovertible
be entitled to a certificate of title under the provisions of this chapter." (Emphasis ours) evidence of ownership, they become strong evidence of ownership acquired by
prescription when accompanied by proof of actual possession of the property or supported
However, as petitioner Abejaron’s 30-year period of possession and occupation required
by other effective proof. 49 Even the tax declarations and receipts covering his house do
by the Public Land Act, as amended by R.A. 1942 ran from 1945 to 1975, prior to the
not bolster his case as the earliest of these was dated 1950.
effectivity of P.D. No. 1073 in 1977, the requirement of said P.D. that occupation and
possession should have started on June 12, 1945 or earlier, does not apply to him. As the Petitioner’s evidence does not constitute the "well-nigh incontrovertible" evidence
Susi doctrine holds that the grant of title by virtue of Sec. 48(b) takes place by operation necessary to acquire title through possession and occupation of the disputed land at least
of law, then upon Abejaron’s satisfaction of the requirements of this law, he would have since January 24, 1947 as required by Sec. 48(b) of the Public Land Act, as amended by
already gained title over the disputed land in 1975. This follows the doctrine laid down in R.A. 1942. The basic presumption is that lands of whatever classification belong to the
Director of Lands v. Intermediate Appellate Court, Et Al., 45 that the law cannot impair

Page 62 of 100
State and evidence of a land grant must be "well-nigh incontrovertible." 50 As petitioner In the present dispute, only the State can file a suit for reconveyance of a public land.
Abejaron has not adduced any evidence of title to the land in controversy, whether by Therefore, not being the owners of the land but mere applicants for sales patents
judicial confirmation of title, or homestead, sale, or free patent, he cannot maintain an thereon, respondents have no personality to file the suit. Neither will they be directly
action for reconveyance. affected by the judgment in such suit.

In De La Peña v. Court of Appeals and Herodito Tan, 51 the petitioner filed an action for x              x              x
reconveyance, claiming preferential right to acquire ownership over a 3/4 hectare of land
and imputing fraud and misrepresentation to respondent in securing a free patent and Clearly, a suit filed by a person who is not a party in interest must be dismissed. Thus, in
original certificate of title over the land in controversy. The action for reconveyance was Lucas v. Durian, 102 Phil. 1157, September 23, 1957, the Court affirmed the dismissal of
dismissed by the trial court and the Court of Appeals. This Court affirmed the decision of a Complaint filed by a party who alleged that the patent was obtained by fraudulent
the Court of Appeals, viz: means and consequently, prayed for the annulment of said patent and the cancellation of
a certificate of title. The Court declared that the proper party to bring the action was the
"It is well-settled that reconveyance is a remedy granted only to the owner of the government, to which the property would revert."
property alleged to be erroneously titled in another’s name. (Tomas v. Court of Appeals,
G.R. No. 79328, 21 May 1990, 185 SCRA 627, 633; Esconde v. Barlongay, G.R. No. Similarly, as petitioner Abejaron has failed to show his title to the disputed land, he is not
67583, 31 July 1987, 152 SCRA 603, 611; Nebrada v. Heirs of Alivio, Et Al., 104 Phil. 126 the proper party to file an action for reconveyance that would result in the reversion of
[1958]; Director of Lands v. Register of Deeds of Rizal, 92 Phil. 826 [1953]; Azurin v. the land to the government. It is the Solicitor General, on behalf of the government, who
Quitoriano, Et Al., 81 Phil. 261 [1948]). In the case at bench, petitioner does not claim to is by law mandated to institute an action for reversion. He has the specific power and
be the owner of the disputed portion. Admittedly, what he has is only a "preferential function to "represent the Government in all land registration and related proceedings"
right" to acquire ownership thereof by virtue of his actual possession since January and to "institute actions for the reversion to the Government of lands of the public domain
1947. . . Title to alienable public lands can be established through open, continuous, and and improvements thereon as well as lands held in violation of the Constitution." Since
exclusive possession for at least thirty (30) years. . . Not being the owner, petitioner respondent Nabasa’s Free Patent and Original Certificate of Title originated from a grant
cannot maintain the present suit. by the government, their cancellation is a matter between the grantor and the grantee.

Persons who have not obtained title to public lands could not question the titles legally Having resolved that petitioner Abejaron does not have legal standing to sue and is not
issued by the State. (Reyes v. Rodriguez, 62 Phil. 771, 776 [1936]) In such cases, the the real party in interest, we deem it unnecessary to resolve the question of fraud and the
real party in interest is the Republic of the Philippines to whom the property would revert other issues raised in the petition. These shall be timely for adjudication if a proper suit is
if it is ever established, after appropriate proceedings, that the free patent issued to the filed by the Solicitor General in the future.
grantee is indeed vulnerable to annulment on the ground that the grantee failed to
comply with the conditions imposed by the law. (See Sec. 101 of C.A. 141 [Public Land WHEREFORE, the petition is DENIED and the impugned decision of the Court of Appeals is
Act]; Lucas v. Durian, 102 Phil. 1157, 1158 [1957]; Sumail v. Judge of the Court of First AFFIRMED. The Complaint filed in Civil Case No. 2492 before the Regional Trial Court of
Instance of Cotabato, Et Al., 96 Phil. 946, 953 [1955]). Not being an applicant, much less South Cotabato, Branch 1, is DISMISSED. No costs.
a grantee, petitioner cannot ask for reconveyance." (Emphasis supplied)
SO ORDERED.
In the more recent case of Tankiko, Et. Al. v. Cezar, Et Al., 53 plaintiffs filed an action for
reconveyance claiming that they were the actual occupants and residents of a 126,112- Davide, Jr., C.J., Kapunan, Pardo and Ynares-Santiago, JJ., concur.
square meter land which was titled to another person. The trial court dismissed the
action, but the Court of Appeals reversed the dismissal. Despite the appellate court’s
finding that plaintiffs had no personality to file the action for reconveyance, the disputed
land being part of the public domain, it exercised equity jurisdiction to avoid leaving
unresolved the matter of possession of the land in dispute. On appeal to this Court, we
reinstated the decision of the trial court and dismissed the action for reconveyance, viz:

". . . equity is invoked only when the plaintiff, on the basis of the action filed and relief
sought, has a clear right that he seeks to enforce, or that would obviously be violated if
the action filed were to be dismissed for lack of standing. In the present case,
respondents have no clear enforceable right, since their claim over the land in question is
merely inchoate and uncertain. Admitting that they are only applicants for sales patents
on the land, they are not and they do not even claim to be owners thereof.

Second, it is evident that respondents are not the real parties in interest. Because they
admit that they are not the owners of the land but mere applicants for sales patents
thereon, it is daylight clear that the land is public in character and that it should revert to
the State. This being the case, Section 101 of the Public Land Act categorically declares
that only the government may institute an action for reconveyance of ownership of a
public land. . .

x              x              x

Page 63 of 100
 SECOND DIVISION September 1963 shall remain in full force and effect, except as modified and
supplemented."2 The respondent, however, failed to pay the second installment when it
G.R. No. L-32621               July 29, 1987 became due. Neither did it return the possession of the property to the petitioner.

ASSOCIATION OF BAPTISTS FOR WORLD EVANGELISM, INC., petitioner, vs. FIRST But, on 8 March 1965, the respondent caused to be recorded in the Office of tile Register
BAPTIST CHURCH and COURT OF APPEALS, respondents. of Deeds of Manila a Notice of Adverse Claim on TCT No. 62203. 3 Upon learning of the
burden constituted on its certificate of title, the petitioner, on 6 June 1965, filed a petition
PADILLA, J.: with the Court of First Instance of Manila for the cancellation of the said notice of adverse
claim, on the ground that when said notice of adverse claim was filed, the respondent had
Review on certiorari of the Resolution* of the respondent Court of Appeals, dated 17 already lost its right to or interest in the property, in view of the automatic rescission of
August 1970, issued in G.R. No. 37022-R, entitled: "Association of Baptists for World the contract caused by the respondent's failure to pay the second installment of the
Evangelism, Inc., petitioner-appellee versus  First Baptists Church, respondent-appellant," purchase price on 30 October 1964, as agreed upon, so that the notice of adverse claim is
which dismissed petitioner's application for cancellation of a notice of adverse claim. invalid and should be cancelled.4
The facts of the case which led to the filing of this petition are as follows: The respondent filed its opposition to the petition for cancellation of notice of adverse
claim5 and the case was then set for hearing. At the hearing on 14 August 1965, the
On 30 September 1963, the parties entered into an agreement, denominated "Contract of
petitioner presented its evidence consisting of the Contract of Purchase and Sale, the
Purchase and Sale" wherein the petitioner agreed to sell to the respondent a parcel of
Supplement thereto, and the Notice of Adverse Claim. The respondent, upon the other
land, together with the building and improvement thereon, with an area of 735 Sq.
hand, did not submit any evidence. The court then declared the case submi tted "
meters, located at the corner of Leon Guinto and Padre Faura Streets, Manila, and
however, in an Order issued on the same day, the court suspended the resolution of the
covered by TCT No. 62203 of the Register of Deeds of Manila, for the amount of
petition to cancel the notice of adverse claim "until after fifteen (15) days from today
P293,506.25, payable in three (3) installments, as follows:
during which time counsel for respondent should file civil action in order to thresh out the
1. The First installment shall be paid by the VENDEE to the VENDOR on or question involved in ordinary suit. If after the lapse of said period no civil action is filed,
before September 30, 1963 amounting to P29,350.62, this Court will be constrained to act on same."6

2. The Second Installment which shall be the sum of P66,038.90, shall be paid The respondent failed to initiate the civil suit, as ordered, so that the petitioner, on 8
by the VENDEE to the VENDOR on or before September 30, 1964. September 1965, filed a motion to give due course to its petition to cancel notice of
adverse claim.7 The motion was set for hearing on 11 September 1965 and, on said date,
3. The last and final installment which shall be the sum of P198,116.72, less the the respondent manifested in court that it was the prevailing opinion among its members
P25,000.00 deduction allowed by the VENDOR, shall be paid by the VENDEE to that to file a suit against the petitioner would be "unscriptural" and that they intend to do
the VENDOR on or before September 30, 1965. so only as a last recourse when it becomes absolutely necessary that it be done.8

The parties further agreed that: On 15 September 1965, the lower court issued an order directing the cancellation of the
notice of adverse claim on TCT No. 62203 on the grounds that the basis of said notice of
All the foregoing payments shall be made by the VENDEE to the VENDOR's duly adverse claim was no longer in force and effect inasmuch as the same was automatically
authorized Resident Agent and attorney-in-fact in Manila, Philippines. rescinded upon the failure of the respondent to pay the second installment when it
became due, and for failure of the respondent to file the civil action, as required by the
It is hereby expressly understood and agreed that immediately upon the court.9
execution of this document and thereafter for a period of five (5) consecutive
years so long as this agreement is in force and effect, the VENDEE shall have The respondent filed a motion for reconsideration of the Order claiming, for the first time,
the right to occupy and use the property for church purposes but for no other that the trial court had no jurisdiction in that, as a land registration court, it cannot pass
purpose whatsoever. upon the issue of whether or not the contract of purchase and sale has been rescinded or
rendered without force and effect,10 but the trial court denied said motion.11
Should the VENDEE fail to pay any or all the installments when due, this
agreement shall automatically be considered as rescinded and without force and Whereupon the respondent appealed to the Court of Appeals. On 25 May 1970, the
effect and the VENDEE shall, without further demand from the VENDOR appellate court rendered judgment affirming the order of the lower court. 12 This decision,
peacefully return possession of the property to the VENDOR; provided, however, however, was set aside by the appellate court in its Resolution dated 17 August 1970 on
that any installment which the VENDEE may have already paid to the VENDOR the ground that the lower court, sitting as a land registration court, had no jurisdiction to
shall be returned by the VENDOR to the VENDEE.1avvphi1 resolve the issues presented which should be litigated in a regular court. Accordingly, the
respondent appellate court ordered the dismissal of the petition to cancel notice of
Upon final and complete payment of the stipulated purchase price the VENDOR adverse claim.13 Hence, the present recourse.
shall immediately execute and deliver to the VENDEE a final and absolute Deed
of Sale of the Property free and clear of all liens and encumbrances. 1 The issue raised is whether the Court of First Instance, now the Regional Trial Court,
acting as a land registration court, has jurisdiction to cancel an adverse claim based on a
The first installment of the purchase price was duly paid and the respondent took contract to sell or promise to sell which can no longer be enforced because of non-
possession of the property. However, when the second installment became due on 30 payment of the agreed purchase price.
September 1964, the petitioner, upon request of the respondent, extended the period of
its payment to 30 October 1964. For this purpose, the parties executed a document This issue had been raised in view of the findings of the respondent Court of Appeals that
entitled: "Supplement to the Contract of Purchase and Sale of September 30, 1963" with the court a quo, sitting as a land registration court, has limited jurisdiction and has no
the stipulation that "all the provisions of the original contract of purchase and sale of 30 authority to resolve controversial issues which should be litigated before a court of

Page 64 of 100
general jurisdiction. Under existing laws, however, this concept no longer holds. Regional WHEREFORE, the resolution of the respondent Court, dated 17 August 1970, is hereby set
Trial Courts now have exclusive jurisdiction, not only over applications for original aside. The notice of adverse claim annotated on petitioner's TCT No. 62203 by virtue of
registration of title to lands, including improvements and interests therein, but also over the "Contract of Purchase and Sale" entered into by and between the parties on 30
petitions filed after original registration of title, with power to hear and determine all September 1963 is hereby ordered cancelled. Without costs.
questions arising upon such applications or petitions. Section 2 of PD 1529, otherwise
known as the Property Registration Decree, provides, as follows: SO ORDERED. Yap (Chairman), Melencio-Herrera, Paras and Sarmiento, JJ., concur.

SEC. 2. Nature of registration proceedings: jurisdiction of courts. — Judicial

proceedings for the registration of lands throughout the Philippines shall be in
rem and shall be based on the generally accepted principles underlying the
Torrens system.

Courts of First Instance shall have exclusive jurisdiction over all applications for
original registration of title to lands, including improvements and interests
therein, and over all petitions filed after original registration of title, with power
to hear and determine all questions arising upon such applications or petitions.
The court through its clerk of court shall furnish the Land Registration
Commission with two certified copies of all pleadings, exhibits, orders, and
decisions filed or issued in applications or petitions for land registration, with the
exception of sten ographic notes, within five days from the filing or issuance
thereof.

But, even under Act 496, the Land Registration Act, the court of first instance, sitting as a
land registration court, has the authority to conduct a hearing, receive evidence, and
decide controversial matters with a view to determining whether or not the filed notice of
adverse clam is valid. Section 110 of Act 496 provides:

SEC. 110. Whoever claims any part or interest in registered land adverse to the
registered owner, arising subsequent to the date of the original registration,
may, if no other provision is made in this Act for registering the same, make a
statement in writing setting forth fully his alleged right or interest, and how or
under whom acquired, and a reference to the volume and page of the certificate
of title of the registered owner, and a description of the land in which the right
or interest is claimed.

The statement shall be signed and sworn to, and shall state the adverse
claimant's residence, and designate a place at which all notices may be served
upon him. This statement shall be entitled to registration as an adverse claim,
and the court, upon a petition of any party in interest, shall grant a speedy
hearing upon the question of the validity of such adverse claim and shag enter
such decree therein as justice and equity may require. If the claim is adjudged
to be invalid, the registration shall be cancelled. If, iii any case the court after
notice and hearing shall find that a claim thus registered was frivolous or
vexatious, it may tax the adverse claimant double or treble costs in its
discretion.

At any rate, it appears that the disputed "Contract of Purchase and Sale" entered into by
and between the parties on 30 September 1963 had already been rescinded so that there
is no more basis for the continued annotation of the notice of adverse claim on the
petitioner's TCT No. 62203. Records show that the herein petitioner had filed an action
against the respondent for the rescission of said contract of purchase and sale on 1
August 1967 before the Court of First Instance of Manila, docketed therein as Civil Case
no. 70298, and after trial, the said contract was ordered rescinded for reasons therein
stated. On appeal to the Court of Appeals, docketed therein as CA-G.R. No. 42467-R, the
judgment was affirmed. The respondent then appealed to this Court, docketed as G.R.
No. L-35008; again, its petition was denied on 15 May 1972, "for being factual
(insufficient showing that the findings of fact are unsupported by substantial evidence)
and for lack of merit." The judgment became final and executory on 14 August 1972.

Page 65 of 100
 FIRST DIVISION The court through its clerk of court shall furnish the Land Registration
Commission with two certified copies of all pleadings, exhibits, orders, and
G.R. No. L-65129 December 29, 1986 decisions filed or issued in applications or petitions for land registration, with the
exception of stenographic notes, within five days from the filing or issuance
TOMAS AVERIA, JR., petitioner, vs. thereof.
THE HONORABLE MILAGROS V. CAGUIOA, in her capacity as Judge of the
Regional Trial Court, Fourth Judicial Region, Branch LVII, Lucena City, and The above provision has eliminated the distinction between the general jurisdiction vested
VERONICA PADILLO, respondents. in the regional trial court and the limited jurisdiction conferred upon it by the former law
when acting merely as a cadastral court. Aimed at avoiding multiplicity of suits, the
CRUZ, J.: change has simplified registration proceedings by conferring upon the regional trial courts
the authority to act not only on applications for "original registration" but also "over all
We gave due course to this petition against a decision of the Court of First Instance of petitions filed after original registration of title, with power to hear and determine all
Lucena City, 1 which is questioned on a pure questions of law, more specifically whether questions arising upon such applications or petitions."
or not the court has jurisdiction to order the registration of a deed of sale which is
opposed on the ground of an antecedent contract to sell. Consequently, and specifically with reference to Section 112 of the Land Registration Act
(now Section 108 of P.D. No. 1529), the court is no longer fettered by its former limited
The oppositor, petitioner herein, refused to participate in the hearing of the registration jurisdiction which enabled it to grant relief only in cases where there was "unanimity
proceedings below, claiming the respondent court, acting as a cadastral court, had no among the parties" or none of them raised any "adverse claim or serious objection."
competence to act upon the said case under Section 112 of Act 496, otherwise known as Under the amended law, the court is now authorized to hear and decide not only such
the "Land Registration Act." The respondent court then held the hearing ex parte  and non-controversial cases but even this contentious and substantial issues, such as the
later rendered a decision ordering the registration prayed for on the basis of the evidence question at bar, which were beyond its competence before.
presented by the private respondent herein. 2
It appears that the respondent court proceeded to hear the case below notwithstanding
In his petition for  certiorari  and prohibition with preliminary injunction, it is argued that the manifestation by the petitioner of his intention to elevate to this Court the question of
the lower court had no competence to act on the registration sought because of the jurisdiction he had raised. 6 The trial court should have given him the opportunity to do so
absence of unanimity among the parties as required under Section 112 of the Land in the interest of due process, pending a categorical ruling on the issue. As it happened, it
Registration Act. 3 The petitioner cites  Fojas as v. Grey,  4 where this Court, through arrived at its decision after considering only the evidence of the private respondent and
Justice Serafin Cuevas, declared: without regard to the evidence of the petitioner. 7
The aforequoted provision of the Land Registration Act (Sec. 112) was relied WHEREFORE, the decision of the respondent court dated September 23, 1983, is set
upon by appellant Apolinar Fojas in petitioning the court a quo for the aside. Let a new trial of Cadastral Case No. 1, GLRO Cad. Record No. 202, Lot No. 2810-
annotation of the Deed of Assignment. However, while he had the right to have B, Lucena Cadastre, MC No. 374-82, be held, at which the petitioner, as well as other
the said Deed annotated in the owner's duplicate of TCT No. T-2376, the serious interested parties, shall be given the opportunity to be heard. Our temporary restraining
objection of Saturnina de Grey to the same raises a substantial controversy order of October 5, 1983, is hereby lifted except as to the registration of the questioned
between the parties. deed of sale which shall depend on the outcome of the said case.
In a long line of decisions dealing with proceedings under Section 112 of the SO ORDERED.
Land Registration Act, it has been held that summary relief under Section 112 of
Land Registration Act can only be granted if there is unanimity among the Yap (Chairman), Narvasa, Melencio-Herrera, and Feliciano, JJ., concur.
parties, or there is no adverse claim or serious objection on the part of any
party in interest; otherwise, the case becomes contentious and controversial
which should be threshed out in an ordinary action or in any case where the
incident properly belongs. 5

While this was a correct interpretation of the said provision, the same is, however, not
applicable to the instant case. The reason is that this case arose in 1982, after the Land
Registration Act had been superseded by the Property Registration Decree, which became
effective on June 11, 1979.

In Section 2 of the said P.D. No. 1529, it is clearly provided that:

SEC. 2. Nature of registration proceedings; jurisdiction of courts.-Judicial

proceedings for the registration of lands throughout the Philippines shall be in
rem and shall be based on the generally accepted principles underlying the
Torrens system.

Courts of First Instance shall have exclusive jurisdiction over all applications for
original registration of title to lands, including improvements and interests
therein, and over all petitions filed after original registration of title, with power
to hear and determine a questions arising upon such applications or petitions.

Page 66 of 100
SECOND DIVISION On June 21, 2000, the court a quo rendered the decision subject of the appeal, the
dispositive portion of which is herein quoted as follows:
G.R. NO. 158840 : October 27, 2006
WHEREFORE, PREMISES CONSIDERED, the Court renders judgment for the plaintiff [now
PILAR DEVELOPMENT CORPORATION, Petitioner, v. SPS. CESAR VILLAR and petitioner PDC] and against the defendants and John Does [now respondents], as follows:
CHARLOTTE VILLAR and JOHN DOES, Respondents.
1. Ordering defendants spouses, John Does, and all persons claiming rights under them
DECISION to vacate the subject premises and deliver possession thereof to the plaintiff;

GARCIA, J.: 2. Ordering defendants spouses, jointly and severally, to pay plaintiff the sum
of  P7,000.00 by way of rental for their use and occupation of the subject property from
An ejectment suit originating from the Metropolitan Trial Court (MeTC) of Las Piñas City, the date of execution of the Contract to sell on December 28, 1994 and every month
Branch 79, therein docketed as Civil Case No. 5397, was decided in favor of herein thereafter until the subject property is finally vacated and possession thereof turned over
petitioner Pilar Development Corporation (PDC). However, on appeal, the Regional Trial to the plaintiff;
Court (RTC) of Las Piñas City, Branch 253, in its decision of April 25, 2002, reversed and
set aside that of the MeTC and ordered the dismissal of the case, allegedly for want of 3. Ordering defendants spouses, jointly and severally, to pay plaintiff by way of attorney's
jurisdiction thereon on the part of the MeTC. The RTC held that it is the Housing and Land fees, the amount of  P30,000.00;
Use Regulatory Board (HLURB), not the regular courts, which has jurisdiction over the
suit. Directly elevating the issue to this Court on pure question of law, this Petition for 4. Ordering defendants spouses to pay the costs of this case.
Review on Certiorari seeks the reversal of the RTC decision and the reinstatement of that
of the MeTC. SO ORDERED.

We GRANT. On August 12, 2000, the [respondents] filed a Notice of Appeal xxx. (Bracketed words
supplied.)
But first, the undisputed facts as narrated by the RTC:
While the respondents raised four (4) issues in their appeal before the RTC, the said
On December 28, 1994, a Contract to Sell (subject contract/contract) was executed by appellate court deemed it proper to limit its decision in favor of the respondents on the
and between the [petitioner] and the [respondents] whereby the former sold to the latter issue of jurisdiction. Thus, after the denial of its motion for reconsideration, the petitioner
a house and lot located at Block 4, Lot 15, B.F. Resort Village Subdivision, Las Piñas City came directly to this Court via this Petition for Review on Certiorari on the sole legal
with an area of 253 square meters (subject property) for a consideration of P960,750.00 question of whether it is the HLURB or the regular courts that has jurisdiction over the
payable on installment with a downpayment of P288,255.00 and the balance subject matter of the case. It is the petitioner's submission that the MeTC correctly
of P672,525.00 in one hundred twenty (120) monthly amortizations at P13,446.00 a assumed jurisdiction over the suit.
month. Parenthetically, the certificate of title over the subject property, which is Transfer
Certificate of Title (TCT) No. T-51834 of the Registry of Deeds of Las Piñas City, was In holding that jurisdiction lies on the HLURB and not on the MeTC, the RTC explained:
issued in the name of the [petitioner] only after the execution of the subject contract and
the consolidation and re-subdivision of a number of parcels of land enumerated in the [A]s borne out by the facts aforestated, the present controversy is not a simple unlawful
contract. detainer case albeit denominated as such. This Court takes cognizance of the fact that
there are pending issues on the validity of the cancellation of the subject contract based
[Respondents] paid the required downpayment and some monthly amortizations up to on the non-payment of the cash surrender value and the right of the [respondents] to
October 1997 after which they defaulted in the payment of the succeeding monthly refund thereof, the determination of which are exclusively lodged with the Housing and
amortizations. For this reason, the [petitioner] cancelled the subject contract thru Land Use Regulatory Board (HLURB) under Presidential Decree Nos. 957 and 1344.
a Notice of Cancellation dated August 31, 1997 (sic)1 personally delivered and received by
a certain Corita Villar on September 5, 1998 and by Cathy Villar, daughter of the The RTC cited Presidential Decree (P.D.) No. 1344, which defines the jurisdiction of the
[respondents] on September 7, 1998. The [petitioner], however, did not refund the cash HLURB (formerly National Housing Authority), as follows:
surrender value to the [respondents].
Section 1. In the exercise of its functions to regulate the real estate trade and business
Despite demands to vacate, the [respondents] still refused to surrender possession of and in addition to its powers provided for in Presidential Decree No. 957, the National
subject premises to the [petitioner]. Housing Authority shall have exclusive jurisdiction to hear and decide cases of the
following nature:
In their Answer, the [respondents] primarily assailed the jurisdiction of the court a quo
over the subject matter and the propriety of the cancellation of the subject contract. (a) Unsound real estate business practices;
Further, the [respondents] put in issue the identity of the property covered by TCT No. T-
518314, alleging that there was no showing that the residential lot stated therein subject (b) Claims involving refund and any other claims filed by subdivision lot or condominium
of the complaint is similar to that provided in the contract. unit buyer against the project owner, developer, dealer, broker or salesman; and

On January 28, 2000, the court a quo issued an Order requiring the parties to submit (c) Cases involving specific performance of contractual and statutory obligations filed by
their respective position papers and thereafter, the case was deemed submitted for buyers of subdivision lot or condominium unit against the owner, developer, dealer,
decision. broker or salesman.

The issue of whether an action filed by a subdivision owner against a lot buyer involving
their contract to sell is within the jurisdiction of the HLURB is not one of first impression.

Page 67 of 100
That issue had been previously resolved by this Court in Roxas v. Court of Appeals, 439 The MeTC correctly ruled that petitioner PDC has the right to possess the subject property
Phil. 966 (2002), citing earlier cases, to wit: upon the effectivity of the cancellation of the contract to sell, pursuant to the terms and
conditions specified therein, insofar as those terms and conditions are not contrary to the
In our view, the mere relationship between the parties, i.e.,  that of being subdivision pertinent provisions of Republic Act (R.A.) No. 6552, otherwise known as "Realty
owner/developer and subdivision lot buyer, does not automatically vest jurisdiction in the Installment Buyer Act."
HLURB. For an action to fall within the exclusive jurisdiction of the HLURB, the decisive
element is the nature of the action as enumerated in Section 1 of P.D. 1344. On this According to R.A. 6552, 3 the cash surrender value, which in this case is equivalent to fifty
matter, we have consistently held that the concerned administrative agency, the percent (50%) of the total payment made by the respondent spouses, should be returned
National Housing Authority (NHA) before and now the HLURB, has jurisdiction to them by the petitioner upon the cancellation of the contract to sell on August 31, 1998
over complaints aimed at compelling the subdivision developer to comply with for the cancellation to take effect. Admittedly, no such return was ever made by the
its contractual and statutory obligations. petitioner. Thus, the said cash surrender value is hereby ordered deducted from the
award owing to the petitioner based on the MeTC judgment, and cancellation takes effect
Thus, in Arranza v. B.F. Homes, Inc., we sustained the HLURB's jurisdiction over by virtue of this judgment.
petitioners' complaint for specific performance to enforce their rights as purchasers of
subdivision lots as regards rights of way, water, open spaces, road and perimeter wall Finally, as regards the award of P7,000.00/month as rental payment decreed by the MeTC
repairs, and security. Also, in Que v. CA,we noted that: for the use of the property in question from the time the respondent spouses obtained
possession thereof up to the time that its actual possession is surrendered or restored to
'the complaint against Que is distinct from the complaint against GDREC and its officers the petitioner, the Court finds the same just and equitable to prevent the respondent
before the HLURB. The first basically pertains to non-performance by the buyer of her spouses, who breached their contract to sell, from unjustly enriching themselves at the
obligations to Klaver, whereas the second deals with non-performance by the seller of its expense of the petitioner which, for all legal intents and purposes, never ceased to be the
own obligations to the buyer, such that Klaver properly sued them before different fora. owner of the same property because of the respondents' non-fulfillment of the
indispensable condition of full payment of the purchase price, as embodied in the parties'
Accordingly, the second complaint by Klaver against GDREC and its officers for unsound contract to sell. However, as earlier explained, this sum is to be reduced by the cash
real estate practices consisting in their unwarranted delay in the delivery of Unit No. surrender value of the payments so far made by the spouses, and the resulting net
1902-A to him was properly lodged with the HLURB. Moreover, in Siasoco v. Narvaja, we amount still owing as accrued rentals shall be subject to legal interest from finality of this
ruled that it is the HLURB, not the trial court that has jurisdiction over complaints for Decision up to the time of actual payment thereof.
specific performance filed against subdivision developers to compel the latter to execute
deeds of absolute sale and to deliver the certificates of titles to buyers. WHEREFORE, the assailed RTC decision dated April 25, 2002 is REVERSED and SET
ASIDE and that of the MeTC dated June 26, 2000, as herein MODIFIED,
But the antecedent circumstances to the present petition are in stark contrast to those in is REINSTATED.
the cited cases of Arranza  and Que. Perusal of paragraphs (a), (b), and (c) of Sec. 1, P.D.
1344 abovecited, vis - à-vis the allegations of the complaint for ejectment filed by No pronouncement as to costs.
Manotok Realty, Inc. with the MeTC, shows clearly that the HLURB has no jurisdiction
over the complaint. Note particularly pars. (b) and (c) as worded, where the SO ORDERED.
HLURB's jurisdiction concerns cases commenced by subdivision lot or
condominium unit buyers. As to par. (a), concerning "unsound real estate Puno, J., Chairperson, Sandoval-Gutierrez, Corona, and Azcuna, JJ., concur.
practices," it would appear that the logical complainant would be the buyers and
customers against the sellers (subdivision owners and developers or
condominium builders and realtors), and not vice versa. (Emphasis supplied.)

Here, it must be noted that the case was filed by the subdivision owner and not the buyer
of a subdivision lot, and the cause of action is one for recovery of possession of the
property on account of the cancellation of the parties' contract to sell for nonpayment by
the respondent spouses of the monthly amortizations pursuant to the terms and
conditions stated in their written contract. The respondent spouses, as buyers of the
subdivision lot in question, had no cause of action against petitioner PDC as subdivision
owner, which may possibly give rise to or constitute any actionable act under the
aforequoted paragraphs (a), (b) and (c) of Section 1, P.D. No. 1344. No jurisdiction
could, therefore, be possibly vested upon the HLURB.

In fine, the RTC erred in applying to this case the ruling in Francel Realty Corporation v.
Court of Appeals,2 where therein defendant buyers of the subdivision lot had previously
filed a case against therein plaintiff subdivision owner for incomplete development of
the subdivision, which infraction on the part of therein plaintiff subdivision owner
became the basis of the buyers to discontinue their payment of the monthly amortization.
Reliance on Francel is, therefore, misplaced considering that the nonpayment by the
spouses Villar as subdivision lot buyers of the monthly amortization was not caused or
preceded by any breach on the part of the herein petitioner as subdivision owner.
Consequently, jurisdiction on the legal issue involving the right of possession over the
subject lot rightfully belongs to the regular courts, in this case the MeTC of Las Piñas City.

Page 68 of 100
SECOND DIVISION In the same omnibus order, the RTC ruled that summons was served properly, thus, the
court had acquired jurisdiction over respondent Carrion. The RTC noted that respondent
G.R. No. 180394             September 29, 2008 Hugo’s failure to disclose at the outset that she was equipped with a special power of
attorney was an act constitutive of misleading the court. Thus, the RTC declared
MARJORIE B. CADIMAS, by her Attorney-In-Fact, VENANCIO Z. ROSALES, vs. respondent Carrion in default, directed petitioner to present evidence ex-parte against
MARITES CARRION and GEMMA HUGO, Respondents. respondent Carrion, and respondent Hugo to file an answer.
DECISION On 18 April 2005, respondent Hugo filed an answer on her behalf and as the attorney-in-
fact of respondent Carrion.11 The answer pleaded a compulsory counterclaim for damages.
TINGA, J.: The following day, petitioner presented evidence ex-parte against respondent Carrion.
Thus, on 22 April 2005, respondent Hugo sought a reconsideration of the omnibus order,
This is a petition for review on certiorari 1 under Rule 45 of the 1997 Rules of Civil
praying for the dismissal of the complaint, the cancellation of the presentation of
Procedure, assailing the Decision2 and Resolution3 of the Court of Appeals in CA-G.R. SP
evidence ex-parte, the lifting of the order of default against respondent Carrion and the
No. 98572. The appellate court set aside two orders4 of the Regional Trial Court (RTC),
issuance of an order directing the extraterritorial service of summons on respondent
Branch 85, Quezon City issued in Civil Case No. Q-04-53581 on the ground that the trial
Carrion.12
court had no jurisdiction over the case.
On 17 January 2007, the RTC issued an order, upholding its jurisdiction over petitioner’s
The instant petition stemmed from the complaint 5 for accion reivindicatoria  and damages
complaint. Citing the interest of substantial justice, the RTC lifted the order of default
filed by petitioner Marjorie B. Cadimas, through her attorney-in-fact, Venancio Z. Rosales,
against respondent Carrion and set the pre-trial conference of the case.13
against respondents Marites Carrion and Gemma Hugo. The complaint was docketed as
Civil Case No. Q-04-53581 and raffled to Branch 85 of the RTC of Quezon City. However, respondents elevated the matter to the Court of Appeals via a special civil
action for certiorari, praying that the Omnibus Order dated 21 March 2005 and Order
In the complaint, petitioner averred that she and respondent Carrion were parties to a
dated 17 January 2007 issued by Judge Teodoro T. Riel be reversed and set aside and
Contract To Sell dated 4 August 2003, wherein petitioner sold to respondent Carrion a
that the complaint in Civil Case No. Q-04-53581 be dismissed for lack of jurisdiction.
town house located at Lot 4-F-1-12 No. 23 Aster Street, West Fairview Park Subdivision,
Quezon City for the sum of P330,000.00 to be paid in installments. According to On 27 September 2007, the Court of Appeals rendered the assailed Decision granting
petitioner, Carrion had violated paragraph 8 of said contract when she transferred respondents’ petition for certiorari. The appellate court set aside the assailed orders of
ownership of the property to respondent Hugo under the guise of a special power of the RTC and ordered the dismissal of petitioner’s complaint for lack of jurisdiction. In its
attorney, which authorized the latter to manage and administer the property for and in Resolution dated 9 November 2007, the Court of Appeals denied petitioner’s motion for
behalf of respondent Carrion. Allegedly, petitioner asked respondent Carrion in writing to reconsideration.
explain the alleged violation but the latter ignored petitioner’s letter, prompting petitioner
to demand in writing that Carrion and Hugo vacate the property and to cancel the Hence, the instant petition, raising the following arguments: (1) based on the allegations
contract.6 in the complaint, the RTC has jurisdiction over Civil Case No. Q-04-53581; (2) in any
case, respondents have expressly submitted to or recognized the jurisdiction of the RTC
On 28 October 2004, petitioner filed a Motion To Declare Defendant Marites Carrion In by filing an answer with counterclaim; and (3) respondents erroneously availed of a Rule
Default,7 alleging that despite the service of summons and a copy of the complaint, 65 petition instead of filing a timely appeal from the order denying their motion to
respondent Carrion failed to file a responsive pleading within the reglementary period. dismiss.14
Respondent Hugo filed a Motion To Dismiss8 on her behalf and on behalf of respondent Essentially, petitioner argues that based on the allegations in the complaint and the
Carrion on 18 November 2004, citing the grounds of lack of jurisdiction to hear the case reliefs sought, the RTC has jurisdiction over the matter. In any case, the compulsory
on the part of the RTC and estoppel and/or laches on the part of petitioner. Respondent counterclaim pleaded in the answer of respondents was an express recognition on their
Hugo argued that the Housing and Land Use Regulatory Board (HLURB) has jurisdiction part of the jurisdiction of the RTC over the complaint for accion reivindicatoria, petitioner
over the complaint because ultimately, the sole issue to be resolved was whether adds.
petitioner, as the owner and developer of the subdivision on which the subject property
stood, was guilty of committing unsound real estate business practices. The petition is meritorious.
In the same motion, respondent Hugo averred that the RTC had not acquired jurisdiction The nature of an action and the jurisdiction of a tribunal are determined by the material
over the person of respondent Carrion for not complying with Section 16, Rule 14 of the allegations of the complaint and the law at the time the action was commenced.
Rules of Court on the proper service of summons on a non-resident defendant. However, Jurisdiction of the tribunal over the subject matter or nature of an action is conferred only
attached to the motion was a special power of attorney, whereby respondent Carrion had by law and not by the consent or waiver upon a court which, otherwise, would have no
authorized respondent Hugo, among others, to manage and administer the subject jurisdiction over the subject matter or nature of an action.15
property and to prosecute and defend all suits to protect her rights and interest in said
property.9 An examination of Section 1 of Presidential Decree (P.D.) No. 1344, 16 which enumerates
the regulatory functions of the HLURB,17
After petitioner filed a comment on the motion to dismiss, the RTC issued an Omnibus
Order10 on 21 March 2005, which denied the motion to dismiss. The RTC held that the readily shows that its quasi-judicial function is limited to hearing only the following
court’s jurisdiction is not determined by the defenses set up in the answer or the motion specific cases:
to dismiss.
SECTION 1. In the exercise of its functions to regulate the real estate trade and business
and in addition to its powers provided for in Presidential Decree No. 957, the National

Page 69 of 100
Housing Authority shall have exclusive jurisdiction to hear and decide cases of the respondent Carrion and that the latter breached the contract when Carrion transferred the
following nature: same to respondent Hugo without petitioner’s consent. 21 Thus, petitioner sought

A. Unsound real estate business practices; the cancellation of the contract and the recovery of possession and ownership of the town
house. Clearly, the complaint is well within the jurisdiction of the RTC.
B. Claims involving refund and any other claims filed by subdivision lot or
condominium unit buyer against the project owner, developer, dealer, broker, or In Javellana v. Hon. Presiding Judge, RTC, Branch 30, Manila,22 the Court affirmed the
salesman; and jurisdiction of the RTC over the complaint for accion publiciana and sum of money on the
ground that the complaint did not allege that the subject lot was part of a subdivision
C. Cases involving specific performance of contractual and statutory obligations project but that the sale was an ordinary sale on an installment basis. Even the mere
filed by buyers of subdivision lot or condominium unit against the owner, assertion that the defendant is a subdivision developer or that the subject lot is a
developer, dealer or salesman. subdivision lot does not automatically vest jurisdiction on the HLURB. On its face, the
complaint must sufficiently describe the lot as a subdivision lot and sold by the defendant
The aforequoted provision must be read in the light of the statute’s preamble or the in his capacity as a subdivision developer to fall within the purview of P.D. No. 957 and
introductory or preparatory clause that explains the reasons for its enactment or the P.D. No. 1344 and thus within the exclusive jurisdiction of the HLURB. 23
contextual basis for its interpretation. The scope of the regulatory authority thus lodged in
the National Housing Authority (NHA) [now HLURB] is indicated in the second and third In their comment, respondents cite Antipolo Realty Corp. v. National Housing
preambular paragraphs of the statute which provide: Authority,24 to bolster the argument that the HLURB has jurisdiction over controversies
involving the determination of the rights of the parties under a contract to sell a
"WHEREAS, numerous reports reveal that many real estate subdivision owners, subdivision lot. Antipolo Realty is not squarely applicable to the instant controversy. The
developers, operators, and/or sellers have reneged on their representations and issue in said case called for the determination of whether the developer complied with its
obligations to provide and maintain properly subdivision roads, drainage, sewerage, water obligations to complete certain specified improvements in the subdivision within the
systems, lighting systems and other similar basic requirements, thus endangering the specified period of time, a case that clearly falls under Section 1, paragraph (c) of P.D.
health and safety of home and lot buyers; No. 1344.
WHEREAS, reports of alarming magnitude also show cases of swindling and fraudulent In the instances where the jurisdiction of the HLURB was upheld, the allegations in the
manipulations perpetrated by unscrupulous subdivision and condominium sellers and complaint clearly showed that the case involved the determination of the rights and
operators, such as failure to deliver titles to the buyers or titles free from liens and obligations of the parties in a sale of real estate under P.D. No. 957, 25 or the complaint for
encumbrances, and to pay real estate taxes, and fraudulent sales of the same subdivision specific performance sought to compel the subdivision developer to comply with its
lots to different innocent purchasers for value  ."18 undertaking under the contract to sell, 26 or the claim by the subdivision developer would
have been properly pleaded as a counterclaim in the HLURB case filed by the buyer
The boom in the real estate business all over the country resulted in more litigation against the developer to avoid splitting causes of action. 27
between subdivision owners/developers and lot buyers with the issue of the jurisdiction of
the NHA or the HLURB over such controversies as against that of regular courts. In the The statement in Suntay v. Gocolay28 to the effect that P.D. No. 957 encompasses all
cases that reached this Court, the ruling has consistently been that the NHA or the HLURB questions regarding subdivisions and condominiums, which was cited by the Court of
has jurisdiction over complaints arising from contracts between the subdivision developer Appeals in the assailed decision, is a mere obiter dictum. As a matter of fact, the Court
and the lot buyer or those aimed at compelling the subdivision developer to comply with in Suntay nullified the orders issued by the HLURB over the action for the annulment of
its contractual and statutory obligations to make the subdivision a better place to live in. 19 an auction sale, cancellation of notice of levy and damages on the ground of lack of
jurisdiction. P.D. No. 957 and P.D. No. 1344 were not the applicable laws because the
We agree with the ruling of the RTC that it has jurisdiction over the case based on the action was brought against a condominium buyer and not against the developer, seller, or
allegations of the complaint. Nothing in the complaint or in the contract to sell suggests broker contemplated under P.D. No. 1344. The action likewise involved the determination
that petitioner is the proper party to invoke the jurisdiction of the HLURB. There is of ownership over the disputed condominium unit, which by its nature does not fall under
nothing in the allegations in the complaint or in the terms and conditions of the contract the classes of disputes cognizable by the HLURB under Section 1 of P.D. No. 1344.
to sell that would suggest that the nature of the controversy calls for the application of
either P.D. No. 957 or P.D. No. 1344 insofar as the extent of the powers and duties of the The Court of Appeals held that the provision in the contract to sell mandating membership
HLURB is concerned. of the buyer of the housing unit in a housing corporation was a strong indication that the
property purchased by respondent Carrion from petitioner was part of a tract of land
Note particularly paragraphs (b) and (c) of Sec. 1, P.D. No. 1344 as worded, where the subdivided primarily for residential purposes. Thus, the appellate court concluded that the
HLURB’s jurisdiction concerns cases commenced by subdivision lot or condominium unit HLURB has jurisdiction over the controversy because the property subject thereof was
buyers. As to paragraph (a), concerning "unsound real estate practices," the logical part of a subdivision project.
complainants would be the buyers and customers against the sellers (subdivision owners
and developers or condominium builders and realtors), and not vice versa.20 Not every controversy involving a subdivision or condominium unit falls under the
competence of the HLURB 29 in the same way that the mere allegation of relationship
The complaint does not allege that petitioner is a subdivision lot buyer. The contract to between the parties, i.e., that of being subdivision owner/developer and subdivision lot
sell does not contain clauses which would indicate that petitioner has obligations in the buyer, does not automatically vest jurisdiction in the HLURB. For an action to fall within
capacity of a subdivision lot developer, owner or broker or salesman or a person engaged the exclusive jurisdiction of the HLURB, the decisive element is the nature of the action as
in real estate business. From the face of the complaint and the contract to sell, petitioner enumerated in Section 1 of P.D. No. 1344. 30 Notably, in Spouses Dela Cruz v. Court of
is an ordinary seller of an interest in the subject property who is seeking redress for the Appeals,31 the Court upheld the jurisdiction of the RTC over the complaint for cancellation
alleged violation of the terms of the contract to sell. Petitioner’s complaint alleged that a of the contract to sell of a subdivision house and lot because the case did not fall under
contract to sell over a townhouse was entered into by and between petitioner and

Page 70 of 100
any of the cases mentioned in Section 1, P.D. No. 1344. In interpreting said provision, the
Court explained, thus:

On this matter, we have consistently held that the concerned administrative agency, the
National Housing Authority (NHA) before and now the HLURB, has jurisdiction over
complaints aimed at compelling the subdivision developer to comply with its contractual
and statutory obligations.

For their part, respondents claim that the resolution of the case ultimately calls for the
interpretation of the contract to sell and the determination of whether petitioner is guilty
of committing unsound real estate business practices, thus, the proper forum to hear and
decide the matter is the HLURB. The argument does not impress.

It is an elementary rule of procedural law that jurisdiction of the court over the subject
matter is determined by the allegations of the complaint irrespective of whether or not
the plaintiff is entitled to recover upon all or some of the claims asserted therein. As a
necessary consequence, the jurisdiction of the court cannot be made to depend upon the
defenses set up in the answer or upon the motion to dismiss, for otherwise, the question
of jurisdiction would almost entirely depend upon the defendant. What determines the
jurisdiction of the court is the nature of the action pleaded as appearing from the
allegations in the complaint. The averments in the complaint and the character of the
relief sought are the matters to be consulted.32 Thus, the allegations in respondents’
motion to dismiss on the unsound real estate business practices allegedly committed by
petitioner, even if proved to be true, cannot serve to oust the RTC of its jurisdiction over
actions for breach of contract and damages which has been conferred to it by law.

WHEREFORE, the instant petition for review on certiorari is GRANTED and the Decision
dated 27 September 2007 and Resolution dated 9 November 2007 of the Court of Appeals
in CA-G.R. SP No. 98572 are REVERSED and SET ASIDE. The orders dated 21 March 2005
and 17 January 2007 of the Regional Trial Court, Branch 85, Quezon City in Civil Case No.
Q-04-53581 are REINSTATED. The Regional Trial Court is ORDERED to resume the
proceedings in and decide Civil Case No. Q-04-53581 with deliberate speed. Costs against
respondents.

SO ORDERED.

Page 71 of 100
 From this order, petitioners came to Us thru this petition. In a resolution dated December
2, 1982, We required respondents to file an answer, and likewise granted a temporary
restraining order enjoining respondent judge from requiring petitioners to file their
answer and enter into trial in Civil Case No. R-22154.
EN BANC
We find the petition impressed with merit. Section 6 of P.D. 1508 reads as follows:
G.R. No. L-62339 October 27, 1983
SECTION 6. Conciliation pre-condition to filing of complaint.— No complaint,
SPOUSES MARIA LUISA P. MORATA AND JULIUS MORATA, petitioners, vs. petition, action for proceeding involving any matter within the authority of the
SPOUSES VICTOR GO and FLORA C. GO and HON. VALERIANO P. TOMOL, JR., Lupon as provided in Section 2 hereof shall be filed or instituted in court or any
Judge, Court of First Instance of Cebu, Branch XI, respondents. other government office for adjudication unless there has been a confrontation
of the parties before the Lupon Chairman or the Pangkat and no conciliation or
Amado G. Olis for petitioners. settlement has been reached as certified by the Lupon Secretary or the Pangkat
Paul G. Gorres for private respondents. Secretary attested by the Lupon or Pangkat Chairman, or unless the settlement
has been repudiated. However, the parties may go directly to court in the
ESCOLIN., J.:
following cases:
In this petition for certiorari and prohibition with prayer for writ of preliminary injunction,
[1] Where the accused is under detention;
the Court is called upon to determine the classes of actions which fall within the coverage
of Presidential Decree No. 1508, 1 otherwise known as Katarungang Pambarangay Law. [2] Where a person has otherwise been deprived of personal liberty calling for
This law requires the compulsory process of arbitration at the Barangay level as a pre- habeas corpus proceedings;
condition for filing a complaint in court, Petitioners contend that said legislation is so
broad and all-embracing as to apply to actions cognizable not only by the city and [3] Actions coupled with provisional remedies such as preliminary injunction,
municipal courts, now known as the metropolitan trial courts and municipal trial courts, attachment, delivery of personal property and support pendente lite; and
but also by the courts of first instance, now the regional trial courts. Upon the other hand,
respondents would limit its coverage only to those cases falling within the exclusive [4] Where the action may otherwise be barred by the Statute of Limitations
jurisdiction of the metropolitan trial courts and municipal trial courts.
Section 2 of the law defines the scope of authority of the Lupon thus:
The antecedent facts are not disputed. On August 5, 1982, respondents Victor Go and
Flora D. Go filed in the defunct Court of First Instance of Cebu, presided by respondent SECTION 2. Subject matters for amicable settlement.—The Lupon of each
Judge Valeriano P. Tomol, Jr., a complaint against petitioners Julius Morata and Ma. Luisa barangay shall have authority to bring together the parties actually residing in
Morata for recovery of a sum of money plus damages amounting to P49,400.00. The case the same city or municipality for amicable settlement of all disputes except:
was docketed as Civil Case No. R-22154.
[1] Where one party is the government ,or any subdivision or instrumentality
On the basis of the allegation in the complaint that the parties-litigants are all residents of thereof;
Cebu City, petitioners filed a motion to dismiss, citing as grounds therefor, the failure of
the complaint to allege prior availment by the plaintiffs of the barangay conciliation [2] Where one party is a public officer or employee, and the dispute relates to
process required by P.D. 1508, as well as the absence of a certification by the Lupon or the performance of his official functions;
Pangkat Secretary that no conciliation or settlement had been reached by the parties. The
motion was opposed by private respondents. [3] Offenses punishable by imprisonment exceeding 30 days, or a fine
exceeding P200.00;
On September 2, 1982, respondent judge issued an order denying the motion to dismiss.
[4] Offenses where there is no private offended party;
Petitioners filed a motion for reconsideration, but the same was denied in an order dated
October 3, 1982, as follows: [5] Such other classes of disputes which the Prime Minister may in the interest
of justice determine upon recommendation of the Minister of Justice and the
Considering the specific reference to City or Municipal Courts in the provisions of Minister of Local Government.
Sections 11 and 12 of P.D. No. 1508, as the Courts to which the dispute settled
or arbitrated by the Lupon Chairman or the Pangkat, shall be elevated for Thus, except in the instances enumerated in sections 2 and 6 of the law, the Lupon has
nullification of the award or for execution of the same, and considering that from the authority to settle amicably all types of disputes involving parties who actually reside
the provision of Section 14 of the same law, the pre- condition to the filing of a in the same city or municipality. The law, as written, makes no distinction whatsoever
complaint as provided for in Section 6 thereof, is specifically referred to, it is the with respect to the classes of civil disputes that should be compromised at the barangay
considered opinion of this Court that the provision of Section 6 of the law applies level, in contradistinction to the limitation imposed upon the Lupon by paragraph (3),
only to cases cognizable by the inferior courts mentioned in Sections 11 and 12 section 2 thereof as regards its authority over criminal cases. In fact, in defining the
of the law. Lupon's authority, Section 2 of said law employed the universal and comprehensive term
"all", to which usage We should neither add nor subtract in consonance with the
In view of the foregoing, the motion for reconsideration filed by the defendants, rudimentary precept in statutory construction that "where the law does not distinguish,
of the order of September 2. 1982, denying their motion to dismiss, is hereby We should not distinguish. 2 By compelling the disputants to settle their differences
denied. [Annex 'G', p. 36, Rollo]. through the intervention of the barangay leader and other respected members of the
barangay, the animosity generated by protracted court litigations between members of
the same political unit, a disruptive factor toward unity and cooperation, is avoided. It

Page 72 of 100
must be borne in mind that the conciliation process at the barangay level is likewise original dispute. But there is nothing in the context of said sections to justify the thesis
designed to discourage indiscriminate filing of cases in court in order to decongest its that the mandated conciliation process in other types of cases applies exclusively to said
clogged dockets and, in the process, enhance the quality of justice dispensed by it. Thus, inferior courts.
to say that the authority of the Lupon is limited to cases exclusively cognizable by the
inferior courts is to lose sight of this objective. Worse, it would make the law a self- Any doubt on the issue before Us should be dispelled by Circular No. 22 issued by Chief
defeating one. For what would stop a party, say in an action for a sum of money or Justice Enrique M. Fernando, 6 the full text of which is quoted as follows:
damages, as in the instant case, from bloating up his claim in order to place his case
beyond the jurisdiction of the inferior court and thereby avoid the mandatory requirement TO: ALL JUDGES OF THE COURTS OF FIRST INSTANCE, CIRCUIT CRIMINAL
of P.D. 1508? And why, indeed, should the law seek to ease the congestion of dockets COURTS, JUVENILE AND DOMESTIC RELATIONS COURTS, COURTS OF
only in inferior courts and not in the regional trial courts where the log-jam of cases is AGRARIAN RELATIONS, CITY COURTS, MUNICIPAL COURTS AND THEIR CLERKS
much more serious? Indeed, the lawmakers could not have intended such half-measure OF COURT
and self-defeating legislation.
SUBJECT: Implementation of the Katarungang Pambarangay Law.
The objectives of the law are set forth in its preamble thus:
Effective upon your receipt of the certification by the Minister of Local
WHEREAS, the perpetuation and official recognition of the time-honored Government and Community Development that all the barangays within your
tradition of amicably settling disputes among family and barangay level without respective jurisdictions have organized their Lupons provided for in Presidential
judicial resources would promote the speedy administration of justice and Decree No. 1508, otherwise known as the Katarungang Pambarangay Law, in
implement the constitutional mandate to preserve and develop Filipino culture implementation of the barangay system of settlement of disputes, you are
and to strengthen the family as a basic social institution; hereby directed to desist from receiving complaints, petitions, actions or
proceedings in cases falling within the authority of said Lupons.
WHEREAS, the indiscriminate filing of cases in the courts of justice contributes
heavily and unjustifiably to the congestion of court dockets, thus causing a Circular No. 12 dated October 20, 1978, issued by the late Chief Justice Fred
deterioration in the quality of justice; Ruiz Castro is to that extent modified.

WHEREAS, in order to help relieve the courts of such docket congestion and This Circular takes effect immediately.
thereby enhance the quality of justice dispensed by the courts, it is deemed
desirable to formally organize and institutionalize a system of amicably settling It is significant that the above-quoted circular embodying the directive "to desist from
disputes at the barangay level. receiving complaints, petitions, actions and proceedings in cases falling within the
authority of said Lupons," has been addressed not only to judges of city and municipal
There can be no question that when the law conferred upon the Lupon "the authority to courts, but also to all the judges of the courts of first instance, circuit criminal courts,
bring together the parties actually residing in the same city or municipality for amicable juvenile and domestic courts and courts of agrarian relations, now known as regional trial
settlement of all disputes, ... ," its obvious intendment was to grant to the Lupon as courts under B.P. No. 129. The said circular was noted by president Ferdinand E. Marcos
broad and comprehensive an authority as possible as would bring about the optimum in a Letter of Implementation, dated November 12, 1979, the first paragraph of which
realization of the aforesaid objectives. These objectives would only be half-met and easily reads as follows: "with the view to easing up the log-jam of cases and solving the
thwarted if the Lupon's authority is exercised only in cases falling within the exclusive backlogs in the case of dockets of all government offices involved in the investigation,
jurisdiction of inferior courts. trial and adjudication of cases, it is hereby ordered that immediate implementation be
made by all government officials and offices concerned of the system of amicably settling
Moreover, if it is the intention of the law to restrict its coverage only to cases cognizable disputes at the barangay level as provided for in the Katarungang Pambarangay Law
by the inferior courts, then it would not have provided in Section 3 thereof the following [Presidential Decree No. 1508]."
rule on Venue, to wit:
Therefore, for the guidance of the bench and the bar, We now declare that the conciliation
Section 3. Venue. ... However, all disputes which involve real property or any process at the barangay level, prescribed by P.D. 1508 as a pre-condition for filing a
interest therein shall be brought in the Barangay where the real property or and complaint in court, is compulsory not only for cases falling under the exclusive
part thereof is situated. competence of the metropolitan and municipal trial courts, but for actions cognizable by
the regional trial courts as well.
for it should be noted that, traditionally and historically, jurisdiction over cases involving
real property or any interest therein, except forcible entry and detainer cases, has always ACCORDINGLY, the petition is granted, and the order of respondent judge denying
been vested in the courts of first instance [now regional trial court]. petitioners' motion to dismiss is hereby set aside. Respondent judge is restrained from
conducting further proceedings in Civil Case No. R-22154, except to dismiss the case. No
But it is pointed out by the respondent judge that Sections 11, 3 12, 4 and 14, 5 of the law costs.
speak of the city and/or municipal courts as the forum for the nullification or execution of
the settlement or arbitration award issued by the Lupon. We hold that this circumstance SO ORDERED.
cannot be construed as a limitation of the scope of authority of the Lupon. As heretofore
stated, the authority of the Lupon is clearly established in Section 2 of the law; whereas Fernando, CJ Concepcion, Jr., Guerrero, Abad Santos, Melencio-Herrera, Plana, Relova
Sections 11, 12 and 14, relied upon by respondent judge, deal with the nullification or and Gutierrez, Jr., JJ concur.
execution of the settlement or arbitration awards obtained at the barangay level. These Makasiar and Teehankee, JJ., reserves his vote.
sections conferred upon the city and municipal courts the jurisdiction to pass upon and De Castro, J., is on leave. 
resolve petitions or actions for nullification or enforcement of settlement/arbitration
awards issued by the Lupon, regardless of the amount involved or the nature of the Separate Opinions

Page 73 of 100
AQUINO, J.: concurring: Whether the Lupons, will be equal to the task imposed upon them and should receive
commensurate remuneration for their work is another question.
I concur. The case filed by the Go spouses in the Court of First Instance of Cebu for the
collection of P49,400 from the Morata spouses, Civil Case No. R-22154, is covered by the  
Katarungang Pambarangay Law, Presidential Decree No. 1508. The impression that the
law applies only to cases filed in inferior courts does not seem to be correct. Of course,
the law applies only to disputes between or among persons actually residing in the same
barangay or to those involving actual residents of different barangays within the same
city or municipality (Sec. 3).

Cases between or among those persons should undergo the conciliation process,
whatever may be the amount involved or the nature of the issue involved as long as they
do not belong to the following cases:

(a) Where the parties involved reside in barangays of different cities or

municipalities unless such barangays adjoin each other;

(b) Where the dispute involves real property located in different cities or
municipalities;

(c) Where one party is the government or any sub-division or instrumentality

thereof;

(d) Where one party is a public officer or employee and the dispute relates to
the performance of his official functions;

(e) Where the dispute involves an offense punishable by imprisonment

exceeding thirty (30) days or a fine exceeding two hundred pesos (P200.00).
Thus, physical injuries requiring medical attendance for not exceeding nine (9)
days, slight slander, light threats, unjust vexation, would be appropriate subject
matters for settlement;

(f) Offenses where there is no private offended party, for example, littering,
gambling, jaywalking, public scandal, vagrancy and prostitution; and,

(g) Such other classes of disputes which the Prime Minister may, in the interest
of justice, determine upon recommendation of the Minister of Justice and the
Minister of Local Government and Community Development. (Sec. 2, Rule VI,
Katarungan Pambarangay Rules).

The parties may go directly to court in the four cases specified in section 6 of the law.

Chief Justice Fernando in his Circular No. 22 dated November 9, 1979 has enjoined all
Judges of the Courts of First Instance, Circuit Criminal Courts, Juvenile and Domestic
Relations Courts, Agrarian Courts, city courts, municipal courts and their clerks of court to
desist from receiving complaints, petitions, actions or proceedings in cases falling within
the authority of the barangay Lupons  effective upon their receipt of the certification  of
the Minister of Local Government and Community Development that all the barangays
within their respective jurisdictions have organized their Lupons as contemplated in the
Katarungang Pambarangay Law.

The Minister of Justice has assumed that the Katarungang Pambarangay Law applies to
the cases in Regional Trial Courts or Courts of First Instance. Thus, he ruled that a
complaint for damages in the sum of P100,000 is a matter falling within the authority of
the Lupon  under section 2 of Presidential Decree No. 1508 (Opinion No. 81, Series of
1981; Katarungang Pambarangay Opinion No. 10 Series of 198 1).

The reference in the law to proper city or municipal court contemplates situations for the
enforcement or nullification of settlement or arbitration award. If there is no award, the
city or municipal court will have no occasion to intervene.

Page 74 of 100
SECOND DIVISION On August 28, 1982, private respondent Atty. Ricardo Reyes, administrator of the estate
and a resident of Cebu City, served upon petitioner a letter demanding that she pay the
[G.R. No. L-63277. November 29, 1983.] overdue rentals corresponding to the period from March to September 1982, and
thereafter to vacate the premises. As petitioner failed to do so, Atty. Reyes instituted on
PETRA VDA. DE BORROMEO, Petitioner, v. HON. JULIAN B. POGOY, September 16, 1982 an ejectment case against the former in the Municipal Trial Court of
Municipality/City Trial Court of Cebu City, and ATTY. RICARDO Cebu City. The complaint was docketed as Civil Case No. R-23915 and assigned to the
REYES, Respondents. sala of respondent judge.
Antonio T. Uy for  Petitioner. On November 12, 1982, petitioner moved to dismiss the case, advancing, among others,
Numeriano G. Estenzo for  Respondents. the want of jurisdiction of the trial court. Pointing out that the parties are residents of the
same city, as alleged in the complaint, petitioner contended that the court could not
SYLLABUS exercise jurisdiction over the case for failure of respondent Atty. Reyes to refer the
dispute to the Barangay Court, as required by PD No. 1508, otherwise known as
1. CIVIL LAW; ACTIONS FOR FORCIBLE ENTRY AND DETAINER; PRESCRIPTIVE PERIOD;
Katarungang Pambarangay Law.
ACTION NOT BARRED IN THE CASE AT BAR. — Under Article 1147 of the Civil Code, the
period for filing actions for forcible entry and detainer is one year, and this period is Respondent judge denied the motion to dismiss. He justified the order in this wise:
counted from demand to vacate the premises. (Desbarat v. Vda. de Laureano, 18 SCRA
116, Calubayan v. Pascual, 21 SCRA 146, Development Bank of the Philippines v. \"The Clerk of Court when this case was filed accepted for filing same. That from the
Canonoy, 35 SCRA 197) In the case at bar, the letter-demand was dated August 28, acceptance from (sic) filing, with the plaintiff having paid the docket fee to show that the
1982, while the complaint for ejectment was filed in court on September 16, 1982. case was docketed in the civil division of this court could be considered as meeting the
Between these two dates, less than a month had elapsed, thereby leaving at least eleven requirement or precondition for were it not so, the Clerk of Court would not have
(11) full months of the prescriptive period provided for in Article 1147 of the Civil Code. accepted the filing of the case especially that there is a standing circular from the Chief
Under the procedure outlined in Section 4 of PD 1508, the time needed for the conciliation Justice of the Supreme Court without even mentioning the Letter of Instruction of the
proceeding before the Barangay Chairman and the Pangkat should take no more than 60 President of the Philippines that civil cases and criminal cases with certain exceptions
days. Giving private respondent nine (9) months-ample time indeed- within which to must not be filed without passing the barangay court." (Order dated December 14, 1982,
bring his case before the proper court should conciliation efforts fail. Thus, it cannot be Annex "c", P. 13, Rollo).
truthfully asserted, as private respondent would want Us to believe, that his case would
be barred by the Statute of Limitations if he had to course his action to the Barangay Unable to secure a reconsideration of said order, petitioner came to this Court through
Lupon. this petition for certiorari. In both his comment and memorandum, private respondent
admitted not having availed himself of the barangay conciliation process, but justified
2. REMEDIAL LAW; SECTION 4 (A) OF P.D. No. 1508; CONSTRUED. — Under Section 4(a) such omission by citing paragraph 4, section 6 of PD 1508 which allows the direct filing of
of PD 1508, referral of a dispute to the Barangay Lupon is required only where the parties an action in court where the same may otherwise be barred by the Statute of Limitations,
thereto are "individuals." An "individual" means "a single human being as contrasted with as applying to the case at bar.
a social group or institution." Obviously, the law applies only to cases involving natural
persons, and not where any of the parties is a juridical person such as a corporation, The excuse advanced by private respondent is unsatisfactory. Under Article 1147 of the
partnership, corporation sole, testate or intestate, estate, etc. Civil Code, the period for filing actions for forcible entry and detainer is one year, 1 and
this period is counted from demand to vacate the premises. 2
3. ID.; JURIDICAL PERSON; REAL PARTY IN INTEREST; REFERRAL TO BARANGAY LUPON,
NOT REQUIRED. — In Civil Case No. R-239l5, plaintiff Ricardo Reyes is a mere nominal In the case at bar, the letter-demand was dated August 28, 1982, while the complaint for
party who is suing in behalf of the Intestate Estate of Vito Borromeo. while it is true that ejectment was filed in court on September 16, 1982. Between these two dates, less than
Section 3, Rule 3 of the Rules of Court allows the administrator of an estate to sue or be a month had elapsed, thereby leaving at least eleven (11) full months of the prescriptive
sued without joining the party for whose benefit the action is presented or defended, it is period provided for in Article 1147 of the Civil Code. Under the procedure outlined in
indisputable that the real party in interest in Civil Case No. R-23915 is the intestate Section 4 of PD 1508, 3 the time needed for the conciliation proceeding before the
estate under administration. Since the said estate is a juridical person (Limjoco v. Barangay Chairman and the Pangkat should take no more than 60 days. Giving private
Intestate of Fragante, 80 Phil. 776) plaintiff administrator may file the complaint directly respondent nine (9) months — ample time indeed — within which to bring his case before
in court, without the same being coursed to the Barangay Lupon for arbitration. the proper court should conciliation efforts fail. Thus, it cannot be truthfully asserted, as
private respondent would want Us to believe, that his case would be barred by the
DECISION Statute of Limitations if he had to course his action to the Barangay Lupon.
ESCOLIN, J.: With certain exceptions, PD 1508 makes the conciliation process at the Barangay level a
condition precedent for filing of actions in those instances where said law applies. For this
Petitioner herein seeks to stop respondent Judge Julian B. Pogoy of the Municipal Trial reason, Circular No. 22 addressed to "ALL JUDGES OF THE COURTS OF FIRST INSTANCE,
Court of Cebu City from taking cognizance of an ejectment suit for failure of the plaintiff CIRCUIT CRIMINAL COURTS, JUVENILE AND DOMESTIC RELATIONS COURT, COURTS OF
to refer the dispute to the Barangay Lupon for conciliation. AGRARIAN RELATIONS, CITY COURTS, MUNICIPAL COURTS AND THEIR CLERKS OF
COURT" was issued by Chief Justice Enrique M. Fernando on November 9, 1979. Said
The intestate estate of the late Vito Borromeo is the owner of a building bearing the
Circular reads:
deceased’s name, located at F. Ramos St., Cebu City. Said building has been leased and
occupied by petitioner Petra Vda. de Borromeo at a monthly rental of P500.00 payable in "Effective upon your receipt of the certification by the Minister of Local Government and
advance within the first five days of the month. Community Development that all the barangays within your respective jurisdictions have
organized their Lupons provided for in Presidential Decree No. 1508, otherwise known as

Page 75 of 100
the Katarungang Pambarangay Law, in implementation of the barangay system of
settlement of disputes, you are hereby directed to desist from receiving complaints,
petitions, actions or proceedings in cases falling within the authority of said Lupons."

While respondent acknowledged said Circular in his order of December 14, 1982, he
nevertheless chose to overlook the failure of the complaint in Civil Case No. R-23915 to
allege compliance with the requirement of PD 1508. Neither did he cite any circumstance
as would place the suit outside the operation of said law. Instead, he insisted on relying
upon the pro tanto presumption of regularity in the performance by the clerk of court of
his official duty, which to Our mind has been sufficiently overcome by the disclosure by
the Clerk of Court that there was no certification to file action from the Lupon or Pangkat
secretary attached to the complaint. 4

Be that as it may, the instant petition should be dismissed. Under Section 4(a) of PD No.
1508, referral of a dispute to the Barangay Lupon is required only where the parties
thereto are "individuals." An "individual" means "a single human being as contrasted with
a social group or institution." 5 Obviously, the law applies only to cases involving natural
persons, and not where any of the parties is a juridical person such as a corporation,
partnership, corporation sole, testate or intestate, estate, etc.

In Civil Case No. R-23915, plaintiff Ricardo Reyes is a mere nominal party who is suing in
behalf of the Intestate Estate of Vito Borromeo. While it is true that Section 3, Rule 3 of
the Rules of Court allows the administrator of an estate to sue or be sued without joining
the party for whose benefit the action is presented or defended, it is indisputable that the
real party in interest in Civil Case No. R-23915 is the intestate estate under
administration. Since the said estate is a juridical person 6 plaintiff administrator may file
the complaint directly in court, without the same being coursed to the Barangay Lupon for
arbitration.

ACCORDINGLY, the petition is hereby dismissed. Respondent judge is ordered to try and
decide Civil Case No. R-23915 without unnecessary delay. No costs.

SO ORDERED.

Makasiar (Chairman), Concepcion, Jr., Guerrero, Abad Santos and De Castro,  JJ., concur.
Aquino  J., concurs in the result.

Page 76 of 100
FIRST DIVISION Both parties appealed to the Office of the President but in a decision dated March 25,
1984, both appeals were dismissed. A motion for reconsideration filed by petitioner was
G.R. No. 83907. September 13, 1989.* denied on May 29,1984.

NAPOLEON GEGARE, petitioner vs. Private respondent paid for the value of 1/2 of the lot and applied for the issuance of a
HON. COURT OF APPEALS (ELEVENTH DIVISION) AND ARMIE ELMA, respondents. patent. In Resolution No. 185, Series of 1985 adopted on October 7, 1985, the Board
gave due course to the application of private respondent and for the issuance of a patent
Camilo Cariño Dionio, Jr. for petitioner. to 1/2 portion of the lot. Petitioner was also advised to file his application and pay for his
Cedo, Ferrer & Associates Law Offices for private respondent. portion. Thus, Miscellaneous Sales Patent No. 4261 and Original Certificate of Title No. P-
5139 were issued to private respondent.
GANCAYCO, J.:
On November 27, 1985, petitioner filed an action for "Annulment and Cancellation of
The familiar story in the Old Testament is of how King Solomon settled the dispute Partition of Lot 5989, Ts-217, situated at Dadiangas, General Santos City and Annulment
between two women over a child by deciding that the child be cut into two for them to of Resolutions No. 272 and 185 and/or to Declare them Null and Void" against private
share. The real mother full of love implored that the King not kill the child and give the respondent and the Board. The suit was docketed as Civil Case No. 3270 in the Regional
child to the other woman. The latter asked the King not to give it to either of them and to Trial Court of General Santos City.
go on, cut the child into two.
On February 11, 1985, private respondent filed a motion to dismiss the complaint on the
This case involves a small piece of land. The decision was to cut it into two between the following grounds: (1) lack of jurisdiction over the subject matter; (2) petitioner has no
parties. But the parallel ends there. The petitioner wants the whole lot. Private capacity to sue; (3) petitioner is not a real party-in-interest; and (4) the action is barred
respondent is happy with his half. This is the impasse that must be resolved. by prior judgment. Private respondent added another ground (5) lack of conciliation
efforts pursuant to Section 6 of Presidential Decree No. 1508. The motion was granted in
The center of controversy is Lot 5989, Ts-217 with an area of about 270 square meters
an order dated March 18, 1986.
situated at Dadiangas, General Santos City. This lot was titled in the name of Paulino
Elma under Original Certificate of Title No. (P-29947) (P-11503) P-1987 issued by the On April 3, 1986, petitioner moved for a reconsideration thereof to which an opposition
Office of the Register of Deeds of General Santos City and Miscellaneous Sales Patent No. was filed by private respondent. The motion for reconsideration was granted in an order
V-635. A reversion case was filed by the Republic of the Philippines against Paulino Elma of April 21, 1986 and private respondent was required to file his responsive pleading.
in the Court of First Instance of South Cotabato docketed as Civil Case No. 950, wherein Private respondent filed his answer. On July 10, 1986, private respondent asked for a
in due course a decision was rendered on January 29, 1973 declaring the title of Paulino preliminary hearing of the grounds for the motion to dismiss in his affirmative defenses.
Elma null and void and the same was ordered cancelled. The lot was reverted to the mass This was denied on July 24, 1986.
of public domain subject to disposition and giving preferential right to its actual occupant,
Napoleon Gegare. Hence, private respondent filed a petition for certiorari and prohibition in the Court of
Appeals questioning the said orders of the trial court dated April 21, 1986 and July 24,
This decision was affirmed by this Court when We dismissed the petition for review on 1986. In due course, a decision was rendered by the appellate court on March 16, 1988
certiorari filed by the heirs of Elma on March 13, 1974 in G.R. No. L-38069. Thereafter, granting the petition, declaring the questioned orders null and void, and directing the trial
the writ of execution was issued and the title of Elma to the property was cancelled. court to dismiss the civil case for lack of jurisdiction, without pronouncement as to costs.
An urgent motion for reconsideration filed by petitioner was denied in a resolution dated
Both petitioner and private respondent filed an application for this lot in the Board of
May 31, 1988. 1
Liquidators (Board for short) in 1975. On June 15, 1976, Resolution No. 606, Series of
1976 was passed by the Board disposing of the lot in favor of petitioner by way of a Thus, the herein petition wherein petitioner raises the following issues---
negotiated sale in conformity with the decision in Civil Case No. 950. Private respondent
protested against the application of petitioner and on August 8, 1978, the Board adopted FIRST ASSIGNMENT OF ERROR
Resolution No. 611, Series of 1978 denying private respondent's protest for the same
reason. A request for reconsideration of private respondent was referred by the Board to THE RESPONDENT COURT ERRED IN DECIDING CA-G.R. SP NO.
Mr. Artemio Garlit, liquidator-designee, General Santos Branch, for verification and 12183 WITHOUT FIRST SERVING SUMMONS AND A COPY OF THE PETITION TO
investigation. After hearings, Mr. Garlit submitted a report to the Manila office THE PRIVATE RESPONDENT IN THE SAID CASE (NOW PETITIONER IN THE
recommending division of the lot to the parties. Nevertheless, on March 13, 1981, the INSTANT CASE), THUS, DEPRIVING HIM OF HIS CONSTITUTIONAL RIGHT TO
Board denied the protest because the case had already been decided by the court. DUE PROCESS OF LAW.

However, a motion for reconsideration filed by private respondent was favorably SECOND ASSIGNMENT OF ERROR
considered by the Board in Resolution No. 233, Series of 1981 dated July 8, 1981. Thus,
the Board directed the chief of LASEDECO to investigate the occupancy and area of the THE RESPONDENT COURT ERRED IN GIVING DUE COURSE TO THE PETITION OF
lot. In this investigation, it was found that only private respondent was the actual ARMIE ELMA IN CA-G.R. SP NO. 12183 IN SPITE OF THE FACT THAT THE TWO
occupant so the LASEDECO chief recommended the division of the property between (2) ORDERS SUBJECT MATTER OF THE PETITION ARE INTERLOCUTORY IN
petitioner and private respondent. NATURE.

On August 14, 1981, the Board passed Resolution No. 272, Series of 1981 approving said THIRD ASSIGNMENT OF ERROR
recommendation by dividing the lot equally between the parties at 135.5 square meters
each to be disposed to them by negotiated sale. THE RESPONDENT COURT ERRED IN HOLDING THAT THE TRIAL COURT HAS NO
JURISDICTION OVER CIVIL CASE NO. 3270.

Page 77 of 100
 FOURTH ASSIGNMENT OF ERROR barangay so Section 6 of Presidential Decree No. 1508 should apply to them as it
provides---
THE RESPONDENT COURT ERRED IN HOLDING THAT THE TRIAL COURT SHOULD
HAVE DISMISSED CIVIL CASE NO. 3270 FOR FAILURE OF THE PLAINTIFF TO Section 6. Conciliation, pre-condition to filing of complaint. No complaint,
COMPLY WITH THE PROVISIONS OF P.D. NO. 1508 BEFORE FILING HIS petition, action or proceeding involving any matter within the authority of
COMPLAINT IN COURT. 2 the Lupon as provided in Section 2 hereof shall be filed or instituted in court or
any other government office for adjudication unless there has been a
The petition is devoid of any merit. confrontation of the parties before the Lupon Chairman or the Pangkat and no
conciliation or settlement has been reached as certified by the Lupon Secretary
Under the first assigned error, petitioner alleges that he was not served summons and a or the Pangkat Secretary attested by the Lupon or Pangkat  Chairman, or unless
copy of the petition so that he was deprived of due process and the respondent court did the settlement has been repudiated.
not acquire jurisdiction over his person.
The purpose of this confrontation is to enable the parties to settle their differences
Private respondent disputes this claim by showing that it was at the address of petitioner amicably. If the other only contending party is the government or its instrumentality or
appearing in the petition at Liwayway Disco Restaurant and Disco Pub, Ilang-Ilang Street, subdivision the case falls within the exception but when it is only one of the contending
General Santos City, where petitioner was served a copy of private respondent's parties, a confrontation should still be undertaken among the other parties.
"Manifestation and Motion for Early Resolution. 3 Petitioner's counsel was also served a
copy of the resolution dated June 28, 1987, 4 "Motion for Restraining Order" dated July WHEREFORE, the petition is DISMISSED. No costs.
28, 1987 and Manifestation dated December 1, 1987. 5 Indeed, petitioner's counsel filed a
motion dated April 4, 1988 seeking a reconsideration of the decision of respondent SO ORDERED.
court 6 which was denied on May 31, 1988. Obviously, petitioner voluntarily submitted to
the jurisdiction of the respondent court and was never deprived of due process. 7 Narvasa, Cruz, Griño-Aquino and Medialdea, JJ., concur.

Under the second and third assigned errors, petitioner contends that the appellate court
erred in giving due course to the petition that assailed the two orders of the court a
quo which are interlocutory in character and in holding that the trial court has no
jurisdiction over Civil Case No. 3270.

It is precisely to correct the lower court when in the course of proceedings it acts without
jurisdiction or in excess thereof or if the trial court judge otherwise acted with grave
abuse of discretion that the extraordinary writ of certiorari or prohibition is afforded to
parties as a relief. Such writ is available even in respect to interlocutory orders. 8

The appellate court correctly ruled that courts of justice will not interfere with purely
administrative matters rendered by administrative bodies or officials acting within the
scope of their power and authority. The discretionary power vested in the proper
executive official in the absence of arbitrariness or grave abuse so as to go beyond the
statutory authority, is not subject to the contrary judgment or control of the courts and is
treated with finality. 9

When Board Resolution No. 272 was passed in 1981, petitioner appealed to the Office of
the President. After his appeal was denied on March 26, 1984, he did not file a petition for
review in this court. Thus, the said decision became final and it was duly implemented.
We agree that when petitioner filed Civil Case No. 3270, the trial court should have
refrained from interfering with said administrative disposition of the chief executive
absent any showing of lack or excess of jurisdiction or grave abuse of discretion.

Moreover, petitioner had no capacity to file the questioned suit in the lower court. The
real party-in-interest who can seek the nullification of the land grant is the government or
the state. 10

Under the fourth and last assigned error, petitioner argues that it was erroneous for the
appellate court to hold that the case should be dismissed by the lower court for failure to
comply with a provision of Presidential Decree No. 1508 before filing the complaint. He
alleges that this rule is not applicable in said case for one of the parties therein is the
government or any subdivision or instrumentality thereof which is excepted from this
requirement under Section 2 of said law.

True it is that the Board is a government instrumentality but the petitioner and private
respondent who are also contending parties in the case are residents of the same

Page 78 of 100
FIRST DIVISION or any part thereof is situated, if the dispute affects real property or any interest
therein. 9
G.R. No. L-65629 November 24, 1986
But the "precondition" does not apply to disputes over which the Lupon has no authority,
TERESITA E. AGBAYANI and LUCAS F. AGBAYANI, petitioners, vs. namely: those —
THE HONORABLE ANTONIO M. BELEN, in his capacity as Regional Trial Judge,
Branch XXXVIII, Regional Trial Court, First Judicial Region, and SPOUSES 1) where one party is the government or any subdivision or instrumentality
SEVERO A. VILLAFUERTE AND ANA P. VILLAFUERTE, respondents. thereof;

NARVASA, J.: 2) where one party is a public officer or employee, and the dispute relates to the
performance of his official functions;
Nullification is sought by petitioners of the Order of respondent Judge 1 dated September
28, 1983, dismissing the civil action instituted by said petitioners against private 3) involving "offenses punishable by imprisonment exceeding 30 days or a fine
respondents and other persons for quieting of title and damages involving three (3) exceeding P200.00," or "where there is no private offended party;
parcels of land in Dayomaca (Tobuan), Poblacion, Sual, Pangasinan. 2 The Court sustained
the defendants' motion to dismiss "on the ground that ... (it had) not yet acquired 4) which the Prime Minister may in the interest of justice determine, upon
jurisdiction to try the case" because of the failure of the petitioners to submit the recommendation of the Minister of Justice and the Minister of Local
controversy to conciliation proceedings pursuant to P.D. No. 1508 before filing their Government; 10
complaint with the Court. The Trial Court justified its action as follows:
5) involving parties who actually reside in barangays of different cities or
The Court after carefully examining and studying the ground set forth by the defendants municipalities, except where such barangays adjoin each other; and
in their motion to dismiss, as well as the arguments advanced by the plaintiff, together
with the pertinent provision of P.D. 1508 cited by the parties, hereby finds that the 6) involving real property located in different municipalities.11
instant action falls within the authority of the Lupon Tagapayapa, and therefore the
parties should first appear before the Lupon Chairman or the Pangkat of the barangay The question presented in this case is whether the "precondition," i.e., the prior
(Tobuan, Sual, Pangasinan) where the properties are located for confrontation as submission of the dispute to the Barangay Lupon for conciliation, should apply to actions
mandated in Section 6 of P.D. 1508. While it appears in the record that  the parties reside affecting real property situated in one city or municipality al-though the parties actually
in barargays of different cities or municipalities, the real property subject matter of the reside in barangays which are located in different cities or municipalities and do not
case are not however located in different barangays but in one and the same barangay, adjoin each other.
that is, Barangay Tobuan, Sual, Pangasinan.  Based on these facts obtaining in this case,
The question has already been passed upon and answered by thisCourt. In Tavora vs.
it is clear and clean that the present action is within the authority of the Lupon, hence the
Veloso, et al., 12 the Court en banc held that the "precondition" had no application to
provision of P.D. 1508 should first be complied with before the complaint could be flied in
cases over which the Lupon had no authority. Specifically, the Court ruled that by express
court. 3
statutory inclusion and exclusion, the Lupon shall have no jurisdiction over disputes
The Order is incorrect and win have to be reversed. where the parties are not actual residents of the same city or municipality, except where
the barangays in which they actually reside adjoin each other." 13 In such a situation,
PD 1508 declares that generally, disputes involving parties actually residing in the same where the Lupon is without jurisdiction of the controversy because the parties are not
city or municipality, or in adjoining barangays of different cities or municipalities, should actual residents of the same city or municipality or of adjoining' barangays, the nature of
first be brought before the appropriate Barangay Lupon which shall have the authority to the controversy is of no moment-whether or not affecting real property or interest
bring together the parties for amicable settlement." 4 The proceedings before the Lupon therein, located in the same city or municipality. And the principle is not at an altered by
are a "precondition" to the filing of any action or proceeding in court or other the proviso of Section 3 of PD 1508(governing venue) that "disputes which involve real
"government office," PD 1508 further declaring that "No complaint, petition, action or property or any interest therein shall be brought in the barangay where the real property
proceeding involving any matter within the authority of the Lupon as provided in Section or any part thereof is situated." The "quoted proviso should simply be deemed to restrict
2 hereof shall be filed or instituted in court or any other government office for or vary the rule on  venue prescribed in the principal clauses of the first paragraph of
adjudiration unless there has been a confrontation of the parties before the Lupon Section 3;" 14 but obviously, the rule on venue is utterly in-consequential as regards a
Chairman or the Pangkat and no conciliation or settlement has been reached as certified case over which the Barangay Lupon does not, in the first place, have any jurisdiction.
by the Lupon Secretary or the Pangkat Secretary, attested by the Lupon or Pangkat
Chairman, or unless the settlement has been repudiated." 5 Since the dispute between the parties in this case was never within the authority or
jurisdiction of the Barangay Lupon because the parties admittedly reside in different cities
A complaint or petition filed in court or other government office without compliance with and municipalities (and not in adjoining barangays), there was no occasion or reason to
the precondition may be dismissed on motion of any interested party on the ground that invoke or apply the rule on venue governing disputes concerning real property. Petitioners
the complaint fails to state a cause of action. 6 The defect may however be waived by were there-fore under no obligation to comply with the "precondition" of first referring
failing to make seasonable objection, in a motion to dismiss or answer, 7 the defect being their dispute with private respondents to the Barangay Lupon for conciliation and
a mere procedural imperfection which does not affect the jurisdiction of the court. 8 amicable settlement before instituting their suit in court. Hence, it was incorrect for the
Trial Court to ascribe this obligation to them, and to dismiss their action for omission to
The venue of these pre-requisite proceedings for conciliation is the Lupon of the fulfill it.
barangay: (1) in which the parties to the dispute are actually residing, or (2) where the
respondent or any of the respondents actually resides, if the parties are actual residents WHEREFORE, the Order of the Trial Court dated September 28, 1983 is hereby annulled
of different barangays within the same city or municipality,or (3) where the real property and set aside, and the case is remanded to that Court for further proceedings, with costs
against private respondents.

Page 79 of 100
SO ORDERED. SEC. 6. Conciliation pre-condition to filing of complaint.—No complaint, petition
action or proceeding involving any matter within the authority of the Lupon as
Yap (Chairman), Melencio-Herrera, Cruz and Feliciano, JJ., concur. provided in Section 2 hereof shall be filed or instituted in court or any other
government office of adjudication unless there has been a confrontation of the
  parties before the Lupon Chairman or the Pangkat and no conciliation or
settlement has been reached as certified by the Lupon Secretary or
the Pangkat Secretary, attested by the Lupon or Pangkat Chairman, or unless
the settlement has been repudiated. However, the parties may go directly to
THIRD DIVISION
court in the following cases:
G.R. No. 71091 January 29, 1988
[1] Where the accused is under detention;
HENRY GALUBA, petitioner, vs.
[2] Where a person has otherwise been deprived of personal liberty calling
SPOUSES ALFREDO and REVELINA LAURETA, HON. JUDGE BRAULIO YARANON,
for habeas corpus  proceedings;
THE SHERIFF OF BAGUIO CITY, respondents.
[3] Actions coupled with provisional remedies such as preliminary injunction,
RESOLUTION
attachment, delivery of personal property and support pendente lite; and
FERNAN, J.:
[4] Where the action may otherwise be barred by the Statute of Limitations.
The issue in this petition for review on certiorari is whether the Regional Trial Court has
In his comment and opposition to the motion to dismiss, petitioner contended that the
jurisdiction to annul an amicable settlement arrived at by the parties through the
lower court had jurisdiction over the case because he had named as defendants therein
mediation of the Lupong Tagapayapa, in the absence of a repudiation of said amicable
the municipal trial court and the sheriff of Baguio City and hence, the complaint fell under
settlement within the 10-day period provided for in Section 11 of Presidential Decree No.
the exceptions in Section 2 [21 of P.D. 1508]. He also expressed doubt that the Lauretas
1508.
were still residing in Baguio City as Alfredo Laureta had been considered at large in some
In a quitclaim and waiver executed on July 10, 1982, Alfredo and Revelina Laureta ceded pending criminal cases against him. He asserted that he had substantially complied with
to petitioner all their rights and interests over a house and lot located in Quezon Hill, P.D. 1508 because he filed the aforementioned complaint of July 31, 1984 before the
Baguio City for P70,000. Petitioner paid the Lauretas P50,000 with the balance payable barangay captain and that after two months of trying to locate defendants, the barangay
later. captain of Victoria Village as Pangkat Chairman,' issued a certification to file action on
October 11, 1984.
When P18,000 of the balance remained unpaid, the parties brought the matter before the
barangay captain of Victoria Village in Baguio City. On February 10, 1984, the parties Thereafter, the Lauretas filed an addendum to their motion to dismiss stating that the
entered into an amicable settlement whereby they agreed that the P18,000 would be paid complaint did not state a cause of action as petitioner failed to repudiate the amicable
in monthly installments starting April, 1984 and that non-compliance therewith would settlement or to file a "Petition for [the] nullification of the award" pursuant to Section 11
"mean execution in accordance with the Barangay Law." 1 of P.D. 1508, and that said complaint should have been filed in the municipal trial court. 4

A month later, petitioner discovered that the house he had bought was encroaching on In his opposition thereto, petitioner argued that the 10-day repudiation period having
the adjoining lot, that the owner thereof was demanding payment for such encroachment, expired, he was left with no recourse but to file the action for nullification in court
and that there were arrears on electric bills and taxes amounting to P6,117. considering that Batas Pambansa Blg. 129, specifically Section 9[1] thereof which gives
Consequently, on July 17, 1984, he filed in the office of the barangay captain of Victoria regional trial courts exclusive original jurisdiction in all civil actions in which the subject of
Village an unsworn complaint for the annulment of the amicable settlement. He alleged litigation is incapable of pecuniary estimation, and its repealing clause under Section 47,
therein that his consent to said settlement had been vitiated by mistake or fraud and should prevail over the provisions of P.D. 1508.
therefore, the amicable settlement should be annulled and a new one entered into by the
On January 9, 1985, the lower court issued an order granting the motion to dismiss on
parties. 2
the grounds of lack of jurisdiction as well as cause of action. Citing Sections 11 and 13 of
Meanwhile, the Lauretas filed in the Municipal Trial Court of Baguio City, Branch IV, a P.D. 1508, the lower court said:"... [T]here is no authorized judicial procedure under P.D.
motion for the issuance of a writ of execution based on the amicable settlement. As the 1508 for the annulment of an amicable settlement. Only an arbitration award, which is
inferior court issued the writ, petitioner filed in the Regional Trial Court of Baguio City a different from an amicable settlement, may become the subject of a petition for
complaint for the annulment of the amicable settlement with prayer for a writ of nullification to be filed yet with the proper municipal trial court. ..." The Court noted the
preliminary injunction and/ or restraining order. 3 fact that petitioner failed to repudiate the amicable settlement within the 10-day period
provided for in Section 11 of P.D. 1508 as the parties entered into said amicable
The lower court denied the prayer for the issuance of a restraining order and/or writ of settlement on February 10, 1984 and yet it was only on July 27, 1984 when petitioner
preliminary injunction. Thereafter, the Lauretas filed a motion to dismiss the complaint on repudiated it through an unsworn complaint for its annulment.
the ground of lack of jurisdiction over the nature of the action. Alleging that in praying for
a restraining order and/or writ of preliminary injunction, petitioner wanted to "circumvent The lower court suggested that "an action for the annulment or rescission of the contract
the mandatory provisions of P. D. 1508," the Lauretas averred that "without the he had with private defendants with a prayer for injunction to restrain in the meantime
unmeritorious petition for preliminary injunction," the dispute between them and the enforcement of the amicable settlement" would perhaps be availed of by the
petitioner was subject to amicable settlement. They cited Section 6 of P.D. 1508 which petitioner.
provides:

Page 80 of 100
From said order, petitioner filed a notice of appeal to this Court. The records of the case Any party, therefore, who fails to avail himself of the remedy set forth in Section 13 must
having been erroneously transmitted to the Court of Appeals, said court certified the case face the consequences of the amicable settlement for he can no longer file an action in
to this Court on March 19, 1985. 5 court to redress his grievances arising from said settlement.

In his petition for review on certiorari, petitioner contended that "there must be a It should be emphasized that under Section 11 of said law, "[t]he amicable settlement
provision of judicial procedure that supplements the deficiency of P.D. 1508." Finding it in and arbitration award shall have the force and effect of a final judgment of a court  upon
Rule 143 of the Rules of Court, petitioner averred that P.D. 1508 being a special law, the the expiration of the ten [10] days from the date thereof unless repudiation of the
Rules of Court may be applied by analogy or in a suppletory character. Thus, under Rule settlement has been made or a petition for nullification of the award has been filed before
39, his remedy against an executory amicable settlement which, by analogy is a final the proper city or municipal court."
judgment, is an action to annul it. Moreover, petitioner asserts that he has a cause of
action because of the fraudulent act or misrepresentation of private respondents herein. Hence, the lower court correctly held that P.D. 1508 does not provide for a judicial
procedure for the annulment of an amicable settlement because the remedy of
As private respondents failed to file a timely comment on the petition, they filed an repudiation supplants the remedy of a court annulment. An aggrieved party may only
explanation, apology and comment alleging that during the extended period for the filing resort to a court action after he has repudiated the settlement in accordance with Section
of said comment, petitioner partially satisfied the "judgement of the barangay court 6 by 13 as Section 6 clearly states that repudiation is a pre-condition to the filing of a
paying them P2,000 thus misleading them to believe that petitioner had abandoned the complaint regarding any matter within the authority of the Lupong Tagapayapa. It should
petition; that on December 6, 1985, the deputy sheriff received from Mrs. Elizabeth be clarified, however, that the "petition for nullification" mentioned in Section 11 refers to
Galuba, wife of petitioner, four [4] checks in the total amount of P10,000 representing full an arbitration award pursuant to Section 7 of the same law and not to an amicable
satisfaction of Galuba's obligation to them; that petitioner himself requested the settlement.
municipal trial court of Baguio City to issue a certification that he had fully settled his
obligation in Barangay Case No. 76 which certification was issued by the clerk of said The primordial objective of P.D. 1508 is to reduce the number of court litigations and
court on May 18, 1980; that as petitioner himself requested for said certification, they prevent the deterioration of the quality of justice which has been brought about by the
thought that petitioner would take the initiative of filing a motion to dismiss the petition; indiscriminate filing of cases in the courts. To allow court actions
that having settled his obligation in said case, petitioner is estopped from questioning the assailing unrepudiated  amicable settlements would exacerbate congestion of court
jurisdiction of the barangay captain, and that they admit that they erred in not informing dockets. This is repugnant to the spirit of P.D. 1508.
this Court of the settlement of the case.
Having failed to repudiate the amicable settlement within the ten-day period, petitioner is
In his reply to said explanation, apology and comment, the petitioner alleged that he was left with no recourse but to abide by its terms. He, therefore, acted correctly when he
forced to satisfy his obligation because "there was nothing more to stay the execution of eventually fully satisfied his obligation pursuant to the amicable settlement, thereby,
the amicable settlement" [sic] after the municipal trial court had issued the writ of rendering his case moot and academic.
execution. He insisted that "the absence of "authorized judicial procedure under PD 1508"
must be supplemented by the Revised Rules of Court in conjunction with the Judiciary ACCORDINGLY, the petition for review on certiorari is hereby DENIED. Costs against the
Reorganization Act of 1980, BP Blg. 129." petitioner.

We vote to deny the petition for review on certiorari. Gutierrez, Jr., Feliciano, Bidin and Cortes, JJ., concur.

Section 6 of P.D. 1508 is mandatory in character. Thus, in Morata v. Go, 125 SCRA
444, Vda. de Borromeo v. Pogoy, 126 SCRA 216 and Peregrina v. Panis, 133 SCRA 72,
We accordingly held that the conciliation process at the barangay level is a condition
precedent for the filing of a complaint in court. In Royales v. Intermediate Appellate
SECOND DIVISION
Court, 127 SCRA 470, We ruled that non-compliance with the condition precedent
prescribed by P.D. 1508 could affect the sufficiency of the plaintiff s cause of action and G.R. No. 96914 July 23, 1992
make his complaint vulnerable to dismissal on the ground of lack of cause of action or
prematurity. Once the parties have signed an amicable settlement, any party who finds CECILIA U. LEDESMA, petitioner, vs.
reasons to reject it must do so in accordance with Section 13 of P.D. 1508 which states: THE HON. COURT OF APPEALS, and JOSE T. DIZON, respondents.
SEC. 13. Repudiation. — Any party to the dispute may, within ten [10] days NOCON, J.:
from the date of the settlement, repudiate the same by filing with the Barangay
Captain a statement to that effect sworn to before him, where the consent is Petitioner Cecilia U. Ledesma prays before this Court for the reversal of the Decision of
vitiated by fraud, violence or intimidation. Such repudiation shall be sufficient the respondent Court of Appeals of August 30, 1990 1 ordering the dismissal of her
basis for the issuance of the certification for filing of a complaint, provided for in ejectment complaint before the Manila Metropolitan Trial Court for lack of cause of action
Section 6, hereof. due to non-compliance with Sections 6 and 9 of P.D. 1508 (Katarungang Pambarangay
Law) as well as the Resolution of January 7, 1991 2 denying petitioner's Motion for
Pursuant to P.D. 1508, Section 12, Rule VI of the  Katarungang Pambarangay  Rules which Reconsideration of said Decision.
were promulgated "for the amicable settlement of disputes at the barangay level, without
judicial recourse," also provides that "[f]ailure to repudiate the settlement or the The facts of this case as summarized by the  petitioner in her Memorandum are as
arbitration agreement within the time limits respectively set [in Section 10 thereof], shall follows:
be deemed a waiver of the right to challenge on said grounds," i.e., fraud, violence or
intimidation. Petitioner is the owner-lessor of an apartment building located at 800-802
Remedios Street, Malate, Manila. Two (2) units of said apartment building were

Page 81 of 100
 leased (now being unlawfully occupied) to private respondent at monthly rates an opposite conclusion to this effect, contrary to law, established jurisprudence
of P3,450.00 for the unit/apartment located at 800 Remedios Street, Malate, and evidence on record.
Manila and P2,300.00 for the unit/apartment located at 802 Remedios Street,
Malate, Manila, respectively. . . . 5. In not holding that the settlement was repudiated, contrary to law and
evidence on record.
Said lease was originally covered by written contracts of lease both dated
December 10, 1984 and except for the rates and duration, the terms and 6. In not affirming the judgment rendered by the Metropolitan Trial Court and
conditions of said contracts were impliedly renewed on a "month-to-month" Regional Trial Court below.
basis pursuant to Article 1670 of the Civil Code.
Petitioner assails private respondent for raising the issue of non-compliance with Sections
One of the terms and conditions of the said Contract of Lease, that of monthly 6 and 9 of P.D. 1508 only in his petition for review with the appellate court and which
rental payments, was violated by private respondent and that as of October 31, mislead the court to erroneously dismiss her complaint for ejectment.
1988, said private respondent has incurred arrears for both units in the total
sum of P14,039.00 for which letters of demand were sent to, and received by, Section 6 of P.D. 1508 states:
private respondent.
Sec. 6. Conciliation pre-condition to filing of complaint. — No complaint,
Upon failure of private respondent to honor the demand letters, petitioner petition, action or proceeding involving any matter within the authority of the
referred the matter to the Barangay for conciliation which eventually issued a Lupon as provided in Section 2 hereof shall be filed or instituted in court or any
certification to file action. Petitioner was assisted by her son, Raymond U. other government office for adjudication unless there has been a confrontation
Ledesma, (who is not a lawyer) during the barangay proceeding as she was of the parties before the Lupon Chairman or the Pangkat and no conciliation or
suffering from recurring psychological and emotional ailment as can be seen settlement has been reached as certified by the Lupon Secretary or the Pangkat
from the receipts and prescriptions issued by her psychiatrist, copies of which Secretary, attested by the Lupon or Pangkat Chairman, or unless the settlement
are attached as Annexes "E-E10" of the said Petition. has been repudiated. . . .

Due to the stubborn refusal of the private respondent to vacate the premises, x x x           x x x          x x x
petitioner was constrained to retain the services of counsel to initiate this
ejectment proceeding. 3 while Section 9 states that:

The Metropolitan Trial Court, Branch 10, Manila, rendered a decision on June 21, 1989 Sec. 9. Appearance of parties in person. — In all proceedings provided for
ordering private respondent to vacate the premises, to pay rentals falling due after May herein, the parties must appear in person without the assistance of
1989 and to pay attorney's fees in the amount of P2,500.00. 4 The Regional Trial Court of counsel/representative, with the exception of minors and incompetents who
Manila, Branch IX, on appeal, affirmed the MTC ruling except for the award of attorney's may be assisted by their next of kin who are not lawyers.
fees which it reduced to P1,000.00. 5
Petitioner submits that said issue, not having been raised by private respondent in the
Private respondent, however, found favor with the respondent Court of Appeals when he court below, cannot be raised for the first time on appeal, specially in the Court of
elevated the case in a Petition for Review, when it ruled, thus: Appeals, citing Saludes vs. Pajarillo. 7 Private respondent had waived said objection,
following the line of reasoning in Royales vs. Intermediate Appelate Court. 8
IN VIEW WHEREOF, the Decision dated October 13, 1989 of the RTC of Manila,
Br. IX in Civil Case No. 89-49672 is reversed and set aside and the Complaint Private respondent denies having waived the defenses of non-compliance with Sections 6
for Ejectment against petitioner is dismissed for lack of cause of action. No and 9 of P.D. 1508. His Answer before the Metropolitan Trial Court, specifically
costs. 6 paragraphs 4, 7, & 8, substantially raised the fact of non-compliance by petitioner with
Sections 6 and 9 of P.D. 1508 and consequently, subjected petitioner's complaint to
Thus, this appeal, raising several assignments of error, namely, that the Court of Appeals dismissal for lack of cause of action, to wit:
erred —
xxx xxx xxx
1. In holding that private respondent raised the issue of non-compliance with
Sections 6 and 9 of P.D. 1508 in the lower court when in fact and in truth his 4. Answering defendant denies the allegations of paragraph 8, the truth of the
answer and position paper failed to do so, contrary to evidence on record; matter being that he was not duly summoned nor subpoenaed by the Barangay
Chairman, who issued the alluded certification, to appear for hearing. 9
2. In failing to consider that private respondent had waived his right to question
the lack of cause of action of the complaint, if there is any, contrary to law, xxx xxx xxx
established jurisprudence, and evidence on record;
7. Plaintiff has no cause of action against answering defendant.
3. In giving undue weight and credence to the self-serving allegations of the
8. The certification to file action (annex D of the complaint) was improperly or
private respondent that summons was not served him, contrary to law,
irregularly issued as the defendant was never summoned nor subpoenaed by
established jurisprudence and evidence on record.
the Barangay Chairman to appear for hearing in connection with the alleged
4. In disregarding the well-known principle of law that barangay authorities are complaint of the plaintiff. In effect the mandatory provision of P.D. 1508 was
presumed to have performed their official duties and to have acted regularly in not complied with warranting the dismissal of the instant complaint.
issuing the certificate to file action and grossly and manifestly erred in making
xxx xxx xxx 10

Page 82 of 100
We do not agree with petitioner that the issue of non-compliance with Sections 6 and 9 of As explained by the Minister of Justice with whom We agree:
P.D. 1508 was raised only for the first time in the Court of Appeals. When private
respondent stated that he was never summoned or subpoenaed by the Barangay To ensure compliance with the requirement of personal confrontation between
Chairman, he, in effect, was stating that since he was never summoned, he could not the parties, and thereby, the effectiveness of the barangay conciliation
appear in person for the needed confrontation of the parties before the Lupon Chairman proceedings as a mode of dispute resolution, the above-quoted provision is
for conciliation and/or amicable settlement. Without the mandatory personal couched in mandatory language. Moreover, pursuant to the familiar maxim in
confrontation, no complaint could be filed with the MTC. Private respondent's allegation in statutory construction dictating that "expressio unius est exclusio alterius", the
paragraph 4 of his Answer that he was never summoned or subpoenaed by the Barangay express exceptions made regarding minors and incompetents must be construed
Chairman; that plaintiff has no cause of action against him as alleged in paragraph 7 of as exclusive of all others not mentioned. 17
the Answer; and that the certification to file action was improperly issued in view of the
foregoing allegations thereby resulting in non-compliance with the mandatory Petitioner's non-compliance with Secs. 6 and 9 of P.D. 1508 legally barred her from
requirements of P.D. No. 1508, as stated in paragraph 8 of the Answer are in substantial pursuing the ejectment case in the MTC of Manila.18 Having arrived at this conclusion,
compliance with the raising of said issues and/or objections in the court below. there is no need for Us to discuss the other issues involved.

Petitioner would like to make it appear to this Court that she appeared before the Lupon WHEREFORE, the questioned decision and resolution of the respondent Court are
Chairman to confront private respondent. She stated in her Petition 11 and her affirmed in toto  with treble costs against petitioner.
Memorandum 12 that:
SO ORDERED.
Upon failure of private respondent to honor the demand letters, petitioner
referred the matter to the barangay for conciliation which eventually issued a Narvasa, C.J., Padilla and Regalado, JJ., concur.
certification to file action. Petitioner was assisted by her son, Raymond U.
Ledesma, (who is not a lawyer) during the barangay proceeding as she was
suffering from recurring psychological and emotional ailment as can be seen
from the receipt and prescriptions issued by her psychiatrist copies of which are
attached herewith as Annexes
"E-E10."

However, as found out by the respondent court:

We agree with the petitioner that private respondent Cecile Ledesma failed to
comply with section 6 of P.D. 1508. The record of the case is barren showing
compliance by the private respondent. Indeed, the documentary evidence of the
private respondent herself attached to the complaint buttresses this conclusion.
They show that it is not the private respondent but her son. Raymund U.
Ledesma, and her lawyer, Atty. Epifania Navarro who dealt with the petitioner
regarding their dispute. Thus, the demand letter dated October 18, 1988 sent to
the petitioner for payment of rentals in the sum of P14,039.00 was signed by
Raymund Ledesma. On the other hand, the demand letter dated November 14,
1988 was signed by Atty. Epifania Navarro. More telling is the Certification to
File Action signed by Barangay Chairman, Alberto A. Solis where it appears that
the complainant is Raymund U. Ledesma and not the private respondent. 13

As stated earlier, Section 9 of P.D. 1508 mandates personal confrontation of the parties
because:

. . . a personal confrontation between the parties without the intervention of a

counsel or representative would generate spontaneity and a favorable
disposition to amicable settlement on the part of the disputants. In other words,
the said procedure is deemed conducive to the successful resolution of the
dispute at the barangay level. 14

Petitioner tries to show that her failure to personally appear before the barangay
Chairman was because of her recurring psychological ailments. But for the entire year of
1988 15 — specifically September to December 6 — there is no indication at all that
petitioner went to see her psychiatrist for consultation. The only conclusion is that 1988
was a lucid interval for petitioner. There was, therefore, no excuse then for her non-
appearance at the Lupon Chairman's office.

Petitioner, not having shown that she is incompetent, cannot be represented by counsel
or even by attorney-in-fact who is next of kin. 16

Page 83 of 100
FIRST DIVISION paragraphs may be punished by the city or municipal court as for indirect
contempt of court upon application filed therewith by the Lupon Chairman, the
G.R. No. L-85475 June 30, 1989 Pangkat Chairman, or by any of the parties. Further, such refusal or willful
failure to appear shall be reflected in the records of the Lupon Secretary or in
MANUEL A. RAMOS, petitioner, vs. the minutes of the Pangkat Secretary and shall bar the complainant from
THE HONORABLE COURT OF APPEALS and DOMINGO RAMOS, respondents. seeking judicial recourse for the same cause of action, and the respondent, from
filing any counterclaim arising out of or necessarily connected therewith.
CRUZ, J.:
xxx
Domingo Ramos authorized his brother Manuel Ramos to sell his share of certain lands
owned by them in common with their other brothers and sisters. Manuel did. Later, SEC. 6. Conciliation, pre-condition to filing of complaint. — No complaint,
Domingo revoked the power of attorney and demanded an accounting from Manuel. petition, action or proceeding involving any matter within the authority of the
Manuel refused. Domingo then filed a complaint with the Punong Barangay of Pampanga, Lupon as provided in Section 2 hereof shall be filed or instituted in court or any
Buhangin District, City of Davao, which was docketed as Case No. 008-87. 1 The Punong other government office for adjudication unless there has been a confrontation
Barangay scheduled a hearing on March 14, 1987. 2 Manuel appeared but Domingo did of the parties before the Lupon Chairman or the Pangkat and no conciliation or
not. He was represented, however, by his wife who said her husband wanted to avoid a settlement has been reached as certified by the Lupon Secretary or the Pangkat
direct confrontation with his brother. 3 She requested that the Punong Barangay issue a Secretary, attested by the Lupon or Pangkat Chairman, or unless the settlement
certification that no settlement had been reached so a complaint could be filed in court. has been repudiated.
The Punong Barangay complied. 4 Thereupon, Domingo sued Manuel in the Regional Trial
Court of Davao City, also for accounting, in Civil Case No. 18560-87. It is clear from the above rules that the dispute should not have ended with the mediation
proceedings before the Punong Barangay because of his failure to effect a settlement
Manuel moved to dismiss the complaint on the ground of non-compliance with the between the brothers. One purpose of P.D. 1508 is precisely to effect a confrontation
requirements of P.D. No. 1508. Specifically, he cited the failure of the Punong Barangay between the parties in the hope that they can resolve their differences without resort to
to refer the dispute to the Pangkat ng Tagapagkasundo after the unsuccessful mediation the courts of justice. Obviously, this purpose would be nullified if the matter were to be
proceedings convened by him. The motion was denied. 5 Manuel then filed with this Court considered closed simply because either of the parties refuses to confront the other.
a petition for certiorari which we referred to the Court of Appeals. That court denied the
petition. It held that there was no need for such referral because Domingo had clearly It was not for the Punong Barangay to say that referral to the Pangkat was no longer
indicated, by his refusal to appear before the Punong Barangay, that no extrajudicial necessary merely because he himself had failed to work out an agreement between the
settlement was possible between him and his brother. 6 Manuel is now before us to petitioner and the private respondent. Indeed, it is possible that the Pangkat could have
question this decision. exerted more efforts and succeeded (where he had not) in resolving the dispute. The
Punong Barangay could in fact have even issued summons to compel the attendance of
We hold for the petitioner. Domingo Ramos, who was the complainant himself in the mediation hearing. It seems the
Punong Barangay had not tried hard enough. In any event, the certification he issued was
The applicable provisions of P.D. No. 1508 (Emphasis supplied) are as follows: certainly premature and did not authorize immediate recourse to judicial action.
SEC. 4. Procedure for amicable settlement. — The case of Alinsugay v. Cagampang, 7 which was applied by respondent court, is not on
all fours with the petition at bar. There the parties claiming non-compliance with P.D.
a) Who may initiate proceedings. — Any individual who has a cause of action
1508 were the very parties who did not appear at the mediation proceedings before the
against another individual involving any matter within the authority of the Lupon
Punong Barangay. The defendants in the case were the respondents who had earlier
as provided in Section 2 may complain orally or in writing, to the Barangay
disregarded the Katarungang Pambarangay Law and were later inconsistently invoking its
Captain of the barangay referred to in Section 3 hereof.
provisions.
b) Mediation by Barangay Captain. — Upon receipt of the complaint, the
In the case before us, it is Manuel Ramos, the respondent in the barangay proceedings,
Barangay Captain shall within the next working day summon the respondent/s,
who actually appeared therein and is now invoking the non-appearance of Domingo
with notice to the complainant's for them and their witnesses to appear before
Ramos, the complainant himself. Domingo, the herein private respondent, is the party
him for a mediation of their conflicting interests. If he fails in his effort within
who did not appear to support his own complaint before the Punong Barangay. He
fifteen (15) days from the first meeting of the parties before him, he shall
invoked the Punong Barangay's jurisdiction and then disregarded it. Under Section 4(d),
forthwith set a date for the constitution of the Pangkat in accordance with the
he is now barred, as complainant in the barangay proceedings, "from seeking judicial
provisions of Section 1 of this Decree.
recourse for the same cause of action."
c) Hearing before the Pangkat. — The Pangkat shall convene not later than
Domingo argues that he did appear through his wife, but this was not permitted by P.D.
three (3) days from its constitution, on the day and hour set by the Barangay
No. 1508. Its Section 9 reads:
Captain, to hear both parties and their witnesses, simplify issues, and explore all
possibilities for amicable settlement. For this purpose, the Pangkat may issue Appearance of parties in person. — In all proceedings provided for herein, the
summons for the personal appearance of parties and witnesses before it. parties must appear in person without the assistance of counsel/representative,
with the exception of minors and incompetents who may be assisted by their
xxx
next of kin who are not lawyers.
d) Sanctions. — Refusal or willfull failure of any party or witness to appear in
In Alinsugay, the Court said that "where one party fails to appear for no justifiable
compliance with the summons issued pursuant to the preceding two (2)
reason, convening the Pangkat as a necessary second step will serve no useful purpose."

Page 84 of 100
True, but we must stress the word justifiable. Mere refusal to appear at the confrontation
as required by the law, when the party invoking P.D. 1508 is the one who disregarded it,
is not a justifiable reason.

It remains to add that the other purpose of the Katarungang Pambarangay Law is to
relieve the trial courts of cases among neighbors that hopefully can be settled through the
mediation of their peers in peaceful and even friendly confrontations. This purpose could
be defeated if such cases were allowed immediate access to the already clogged judicial
dockets simply because one of the parties is unwilling to submit to justice at the barangay
level.

WHEREFORE, the petition is GRANTED and the appealed decision is REVERSED. The
respondent judge is ordered to DISMISS Civil Case No. 18560-87. Costs against the
private respondent.

S0 ORDERED.

Narvasa, Gancayco, Griño-Aquino and Medialdea, JJ., concur.

Page 85 of 100
THIRD DIVISION SO ORDERED.

G.R. No. 80264 May 31, 1989 Four (4) months later, on 15 May 1986, private respondent filed a Petition for Relief from
Judgment with the trial court, alleging that the court had no jurisdiction to render its
SAN MIGUEL VILLAGE SCHOOL, petitioner, vs. decision dated 26 January 1986 for failure of petitioner to go through the mandatory
HONORABLE AMIR PUKUNUM D. PUNDOGAR and CHRISTINA TRIÑO, respondents. conciliation procedure prescribed by Sections 2 and 6 of P.D. No. 1508. Private
respondent argued that the certification of the Barangay Captain of Palao dated 17
Estelito R. Alvia for petitioner. September 1985 was inadequate compliance with P.D. No. 1508, private respondent
Macalalag Law Office & Associates for private respondent. being a resident, not of Barangay Palao, Iligan City, but rather of Barangay Tomas Cabili,
Iligan City.
FELICIANO, J.:
Almost a year later, on 6 April 1987, the trial court, this time presided over by respondent
On 2 October 1985, petitioner San Miguel Village School filed a complaint for breach of Judge Amir Pukunum D. Pundogar, issued an order upholding private respondent's
contract with damages against respondent Christina Triño, before the Regional Trial contentions and setting aside the assailed decision of 26 January 1986. In his order, while
Court, Branch 3, Lanao del Norte, the complaint being docketed as Civil Case No. L-111- Judge Pundogar acknowledged the impropriety of the Petition for Relief from Judgment,
577. A Certificate to File Action, signed by the Barangay Captain of Barangay Palao, Iligan he nonetheless in effect granted the relief sought, holding that the Regional Trial Court in
City, dated 17 September 1985, bearing the notation that the "respondent cannot be rendering the decision dated 26 January 1986, acted without jurisdiction "over the parties
contacted," was filed along with the complaint. and the subject matter of the action" 1 for failure of petitioner to comply with the
requirements of P. D. No. 1508. A Motion for Reconsideration by petitioner was denied by
Summons was served upon the private respondent through her husband. On 22
the respondent Judge.
November 1985, private respondent having failed to file an answer within the
reglementary period, the petitioner School moved to declare her in default. The trial court In the instant Petition, it is vigorously contended by petitioner that the trial court had
granted the motion, declared private respondent in default and designated the Branch jurisdiction to render its decision of 26 January 1986.
Clerk of Court to receive the evidence of the petitioner and thereafter to report back to
the court. The Court notes, at the outset, that respondent Judge in fact granted the Petition for
Relief from Judgment not because he found one or more of the grounds specified in
From the evidence received by the Branch Clerk of Court from the petitioner, the Section 2 of Rule 38 of the Revised Rules of Court (fraud, accident, mistake or excusable
following facts emerged: negligence) but rather because respondent Judge found his predecessor in the same court
to have acted without jurisdiction.
On 9 May 1985, petitioner, a duly accredited private school located at Barangay Palao,
Iligan City, entered into a contract of services with private respondent Christina Triño. It is, however, firmly settled 2 that failure of a plaintiff to comply with the requirements of
Under that contract, Christina Triño would teach at the petitioner School during the P.D. No. 1508 does not affect the jurisdiction of the court that tried the action. In,
schoolyear 1985-1986, which would commence in June 1985 and end in March 1986. She e.g., Millare v. Hernando, the Court stressed that "the conciliation procedure required
was assigned to take charge of Grade VI, Intermediate Department. The contract also under P.D. No. 1508 is not a jurisdictional requirement in the sense that failure to have
provided that any party desiring to terminate the contract before its scheduled expiration, prior recourse to such procedure would not deprive a court of its jurisdiction either over
would give the other party at least one month notice of termination in writing. Sometime the subject matter or over the person of the defendant." 3 Failure of a plaintiff to go
in August 1985, while the contract was in full force and effect, and during a final through the conciliation procedure established by P.D. No. 1508 merely affects the
examination period, private respondent suddenly stopped teaching at the petitioner sufficiency, or the maturity or ripeness of the plaintiffs cause of action and the complaint
School, without giving notice of termination and thereby causing not inconsiderable becomes vulnerable to a motion to dismiss, not on the ground of lack of jurisdiction, but
difficulties for the School. Petitioner School immediately sought the assistance of the rather for want of cause of action or for prematurity. 4 Respondent Judge was thus in
Barangay Captain of Palao and the commencement of conciliation proceedings, This palpable error in holding his predecessor without jurisdiction to render the assailed
attempt failed because private respondent could not be contacted, she having left Iligan decision.
City and having secured a better paying job at the Philippine Refugee Center based in
Manila. Respondent Judge was equally in error when he either disregarded or misconstrued the
Certificate to File Action, dated 17 September 1985, which had been, issued by the
On 26 January 1986, the trial court then presided over by Judge Magadapa Rasuman Barangay Captain of Barangay Palao.
rendered a decision against private respondent, the dispositive portion of which read as
follows: Respondent Judge simply said apropos  this Certificate to File Action, that no
"confrontation" had taken place between petitioner and private respondent before the
WHEREFORE, based on the foregoing consideration, judgment is hereby Barangay authorities and immediately concluded that the requirements of P.D. No. 1508
rendered in favor of the plaintiff, San Miguel Village School and against had been violated. There is no question that the "confrontation" or conciliation
defendant, Christina Triño as follows; proceedings did not materialize here, since private respondent did not appear before
the Lupon. Where, however, the defendant in an action fails for one reason or another to
1. Ordering defendant to pay all compensatory damages to the plaintiff, the
respond to a notice to appear before the Lupon, the requirement of P.D. No. 1508 must
amount of P8,400.00;
be regarded as having been satisfied by the plaintiff. A defendant cannot be allowed to
2. To pay plaintiff, the amount of P5,000.00, as moral damages; frustrate the requirements of the statute by her own refusal or failure to appear before
the Lupon and then later to assail a judgment rendered in such action by setting up the
3. To pay attorney's fees of P5,000.00, and very ground of non-compliance with P.D. No. 1508. In simplest terms, a defendant cannot
be allowed to profit by her own default.
4. To pay the costs of this suit.

Page 86 of 100
In the instant case, private respondent, as noted earlier, had stated in her subsequent
Petition for Relief from Judgment that she resided not in Barangay Palao but in Barangay
Cabili, in effect suggesting that she had not received notice to appear before the Lupon of
Barangay Palao. We do not believe that the statement and suggestion of private
respondent should be given much credence. In the first place, the Barangay authorities of
Barangay Palao must be presumed to have performed their official duties and to have
acted regularly in issuing the Certificate to File Action. They must be presumed to have
sent a notice to Christina Triño to appear before the Lupon; otherwise, they could not
reasonably have stated that Christina "could not be contacted." Secondly, petitioner
School had already presented evidence during the hearing before the Commissioner
appointed by Judge Rasuman that both petitioner and private respondent were residents
of Palao, Iligan City.

Finally, and in any event, the alleged failure on the part of a plaintiff to comply with the
procedural requirement established by P.D. No. 1508 must be raised in a timely manner,
that is, at the first available opportunity, if such alleged failure is to provide legal basis for
dismissal of the complaint. Such failure must be pleaded, in other words, in a timely
motion to dismiss or in the answer. Failure to so set up that defense produces the effect
of waiver of such defense. In the instant case, private respondent was declared in default
and that default order was never set aside. Accordingly, private respondent must be held
to have waived whatever right she may have had to raise the defense of failure to comply
with the compulsory conciliation procedure under P.D. No. 1508. Indeed, that was not the
only thing she waived; she also waived the right to appear and to file an answer and
there to set up that and other defenses that she might have had. It is simply too late to
demand conciliation under P.D. No. 1508 after a judgment on the merits (albeit by
default) has been rendered and become final and executory.

ACCORDINGLY, the Orders of respondent Judge Amir Pukunum D. Pundogar dated 6 April
1987 and 15 June 1987 in Civil Case No. L-111-577 are hereby REVERSED and SET
ASIDE and the Decision dated 26 January 1986 of Judge Magadapa Rasuman is hereby
REINSTATED. Costs against private respondent.

SO ORDERED.

Fernan, C.J., Gutierrez, Jr., Bidin and Cortes, JJ., concur.

Page 87 of 100
EN BANC respondent admittedly failed to do. The failure to allow the LUPON to act on the
controversy at bar prior to the institution of the instant ejectment case did
G.R. No. L-65072 January 31, 1984 render the city court, and even this court, devoid of competence and jurisdiction
to pass upon the present complaint of private respondent. There is, therefore,
APOLINAR R. ROYALES and PRESENTACION GREGORIO, petitioners, vs. no recourse left but to dismiss it, without prejudice to refiling it after due
HON. INTERMEDIATE APPELLATE COURT, JOSE PLANAS, HON. J. CESAR SANGCO observance of the formalities prescribed by law on the matter.
etc., et al., respondents.
Reconsideration of the decision having been denied, respondent Planas appealed to the
Citizens Legal Assistance Office for petitioners. Intermediate Appellate Court, which on July 12, 1982 promulgated a decision vacating
The Solicitor General for respondents. the judgment of the Regional Trial Court, thus confirming the decision of the City Court of
Manila. Unable to obtain a reconsideration thereof, petitioners filed the instant petition
ESCOLIN, J.: before this Court.
Sought to be annulled in this petition for review is a final and executory judgment The petition is devoid of merit.
rendered by the City Court [now Metropolitan Trial Court] of Manila in Civil Case No.
057662-CV on ground of lack of jurisdiction. Petitioners contend that the Court did not In disputes covered by P.D. 1508, as in the case at bar, the barangay conciliation process
acquire jurisdiction over the case for failure of respondent Jose Planas, plaintiff therein, to is a pre-condition for the filing of an action in court. This is so provided by Section 6 of
avail of the barangay conciliation process before the filing of the case in court, as required the said law:
by P.D. 1508, otherwise known as the "Katarungang Pambarangay Law."
Section 6. Conciliation, pre-condition to filing of complaint. — No complaint,
The facts upon which this issue rests are the following: The spouses Apolinar R. Royales petition, action or proceeding involving any matter within the authority of the
and Presentacion Gregorio, petitioners herein, are the lessees of a residential house Lupon as provided in Section 2 hereof shall be filed or instituted in Court or any
owned by respondent Jose Planas located at No. 1866 Int. I, Oroquieta St., Manila. On other government office for adjudication unless there has been a confrontation
August 25, 1980, Planas instituted before the then City Court of Manila an ejectment suit of the parties before the Lupon Chairman or Pangkat and no conciliation or
against petitioners, docketed as Civil Case No. 057662-CV and assigned to the sala of settlement had been reached as certified by the Lupon Secretary or the Pangkat
Judge J. Cesar Sangco. Secretary attested by the Lupon or Pangkat Chairman or unless the settlement
has been repudiated. ...
Issues having been joined, trial on the merits ensued. Respondent Planas testified on his
own behalf and was cross-examined by petitioners' counsel. There is no dispute that prior to the filing of the complaint, the case was never referred to
the Barangay Lupon for conciliation. In fact, respondent Planas failed to allege in his
On November 10, 1981, when neither petitioners nor their counsel appeared at the complaint compliance with this condition precedent. But is this omission fatal?
hearing despite due notice, the case, on motion of respondent Planas, was considered
submitted for decision. On November 26, 1981, the trial court rendered a decision, the Ordinarily, non-compliance with the condition precedent prescribed by P.D. 1508 could
dispositive portion of which reads: affect the sufficiency of the plaintiff's cause of action and make his complaint vulnerable
to dismissal on ground of lack of cause of action or prematurity; 1 but the same would
WHEREFORE, judgment is hereby accordingly rendered ordering defendants and not prevent a court of competent jurisdiction from exercising its power of adjudication
all persons holding or claiming under them to immediately vacate the house over the case before it, where the defendants, as in this case, failed to object to such
located at No. 1866 Int. I Oroquieta Street, Sta. Cruz, Manila, subject of this exercise of jurisdiction in their answer and even during the entire proceedings a quo.
action and restore possession thereof to the plaintiff and to pay to the latter;
While petitioners could have prevented the trial court from exercising jurisdiction over the
1. The sum of P1,000.00 as and for attorney's fees; and case by seasonably taking exception thereto, they instead invoked the very same
jurisdiction by filing an answer and seeking affirmative relief from it. What is more, they
2. The costs of suit.
participated in the trial of the case by cross-examining respondent Planas. Upon this
After the decision had become final and executory, Planas filed a motion for execution premise, petitioners cannot now be allowed belatedly to adopt an inconsistent posture by
and the same was granted by the court. Execution of the judgment was however attacking the jurisdiction of the court to which they had submitted themselves voluntary.
restrained by the Regional Trial Court of Manila upon the filing by petitioners of a petition As this Court ruled in Tijam vs. Sibonghanoy: 2
for certiorari and prohibition with preliminary injunction, wherein they assailed the said
. . . . . . . a party cannot invoke the jurisdiction of a court to secure affirmative
decision on ground of lack of jurisdiction, allegedly arising from failure of respondent
relief against his opponent and, after obtaining or failing to obtain such relief,
Planas to submit the dispute to the Barangay Lupon for conciliation as required by P.D.
repudiate or question that same jurisdiction (Dean vs. Dean, 136 Or. 694, 86,
1508.
A.L.R. 79).
After due hearing, the Regional Trial Court handed down a decision declaring the
In the case just cited, by way of explaining the rule, it was further said that the
judgment of the trial court null and void for having been rendered without jurisdiction.
question whether the court had jurisdiction either of the subject-matter of the
Having found that "the parties in the case are residents not only of the same city, but of
action or the parties was not important in such cases because the party is
the same barangay, i.e., Bgy. 336, Zone 34, District 2, City of Manila," the court ruled:
barred from such conduct not because the judgment or order of the court is
Like the court of origin, this court is equally barren of jurisdiction to take valid and conclusive as an adjudication, but for the reason that such a practice
cognizance of the subject controversy which was prematurely filed with the city can not be tolerated — obviously for reasons of public policy.
court, even before it could be referred to the barangay authorities for
conciliation as explicitly required under P.D. 1508, something the private

Page 88 of 100
Furthermore, it has also been held that after voluntarily submitting a cause and
encountering an adverse decision on the merits, it is too late for the loser to question the
jurisdiction or power of the court . . . . And in Littleton vs. Burges, 16 Wyo. 58, the Court
said that it is not right for a party who has affirmed and invoked the jurisdiction of a court
in a particular matter to secure an affirmative relief, to afterwards deny that same
jurisdiction to escape a penalty.

WHEREFORE, the petition is hereby dismissed and the decision of the respondent
Intermediate Appellate Court in AC-G.R.-SP-00342 is hereby affirmed. Costs against
petitioners.

SO ORDERED.

Fernando, C.J., Teehankee, Makasiar, Aquino, Concepcion, Jr., Guerrero, De Castro,

Melencio-Herrera, Plana, Relova and Gutierrez, Jr., JJ., concur.

Separate Opinions

 ABAD SANTOS, J., concurring:

A simple ejectment case has gone all the way to this Court and assigned not to a Division
thereof but to the Banc on what appears to be a legal question of some novelty but which
to me does not deserve the treatment accorded to it. I think it is enough that the case
has gone before the City Court, the Court of First Instance and the Court of Appeals. But
having reached this Court and for this Court only to affirm the decision of the Court of
Appeals, a simple denial of the petition instead of the full treatment given to it would
have been sufficient and more appropriate.

Page 89 of 100
EN BANC conciliation procedure under Pres. Dec. No. 1508 is not a jurisdictional requirement and
its non-compliance cannot affect the jurisdiction which the court has already acquired
G.R. No. L-59801 May 31, 1988 over the subject matter or over the person of the defendant. [Gonzales v. Court of
Appeals, G.R. Nos. L-59495-97, June 26, 1987, 151 SCRA 287; Millare v. Hernando, G.R.
LEONOR P. FERNANDEZ, CONNIE P. HALL, BERNARDO PERALTA and MARIANO No. L-55480, June 30, 1987,151 SCRA 484].
FERNANDEZ, petitioners, vs.
THE HONORABLE FRANCIS J. MILITANTE, in his capacity as Judge, Court of First It is likewise noteworthy that petitioners have invoked the jurisdiction of the respondent
Instance of Cebu, Branch XII, ESTRELITO P. CAPUTOLAN, GONZALO P. trial court by an answer and seeking affirmative relief from it. They cannot now repudiate
CAPUTOLAN, RAQUEL C. ANIBAN, ESTANISLAO L. CAPUTOLAN and WILFREDO that jurisdiction to which they have submitted themselves voluntarily [Royales v.
ANIBAN, respondents. Intermediate Appellate Court, citing Tijam v. Sibonghanoy, G.R. No. L-21450, April 15,
1968, 23 SCRA 29].
Fernando B. Yu for petitioners.
Valeriano S. Carrillo for respondents. Even assuming that petitioners' motion to dismiss had been filed on time, it is doubtful
whether the Lupon has authority over the controversy considering allegations regarding
CORTES, J.: the residence of the parties involved. Petitioners and private respondents are admittedly
all residents of Jones Avenue, Cebu City, with the exception of petitioner Connie P. Hall
The case at bar involves the assumption of jurisdiction by a trial court over a complaint who is a citizen of the United States of America and a resident of Greenberry Drive, La
without prior conciliation proceedings between the parties before Puerte, California, U.S.A. The ruling in the case of Tavora v. Velasco [G.R. No. 60367,
the Lupong Tagapayapa as prescribed by Pres. Dec. No. 1508 (Katarungang Pambarangay September 30, 1982, 117 SCRA 613] resolves this point.
Law). This Court issued a Temporary Restraining Order on March 9,1982 enjoining
respondent Judge from taking further action in the case during the pendency of the ... Section 2 (of Pres. Dec. No. 1508) specifies the conditions under which the
petition. Lupon of a barangay "shall have authority" to bring together the disputants for
amicable settlement of their dispute: The parties must be "actually residing in
The facts are simple. Private respondents brought action against petitioners before the the same city or municipality." At the same time, Section 3-while reiterating
then Court of First Instance of Cebu, Branch XII, for "Declaration of Nullity of Deed of that the disputants must be "actually residing in the same barangay " or in
Sale and of Transfer Certificates of Title" and docketed as Civil Case No. R-20105. "different barangays." within the same city or municipality-unequivocably
Petitioners filed on March 9, 1981 their answer raising special and affirmative defenses declares that the Lupon shall have "no authority" over disputes "involving
including a counterclaim. Subsequently, the case was set for pre-trial and on April 15, parties who actually reside in barangays of different cities or municipalities,"
1981, the first pre-trial conference was held. except where such barangays adjoin each other.
On May 27,1981, petitioners filed a Motion to Dismiss on the ground that the court never Thus, by express statutory inclusion and exclusion, the Lupon shall have no
acquired jurisdiction over the case for non-compliance with the requirement of conciliation jurisdiction over disputes where the parties are not actual residents of the same
before the Lupong Tagapayapa. The trial court overruled the arguments raised by the city or municipality, except where the barangays in which they actually reside
petitioners and denied their motion on June 17, 1981. Motion for reconsideration was also adjoin each other. [Emphasis supplied].
denied for being filed out of time. Hence, this petition for certiorari and prohibition with
preliminary injunction. WHEREFORE, the petition is hereby DISMISSED and the order of the respondent trial
court in Civil Case No. R-20105 denying petitioners' motion to dismiss is AFFIRMED. The
The present petition is premised on the argument that inasmuch much as the complaint Temporary Restraining Order issued by this Court on March 9, 1982 is hereby LIFTED and
before the trial court is a proper subject of conciliation before the Lupong Tagapayapa, SET ASIDE.
non-compliance with such requirement is a jurisdictional defect which renders the
complaint vulnerable to dismissal. SO ORDERED.
The parties do not dispute the fact that the case now before the lower court was never Yap, C.J., Fernan, Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Feliciano,
referred to the Lupong Tagapayapa for conciliation. This Court has repeatedly ruled that Gancayco, Padilla, Bidin, Sarmiento and Griño-Aquino, JJ., concur.
the conciliation process at the Barangay level is a condition precedent for filing of actions
before the regular trial courts and ordinarily, non-compliance therewith could affect the
sufficiency of plaintiff's cause of action and make his complaint vulnerable to dismissal on
the ground of lack of cause of action or prematurity [Royales v. Intermediate Appellate
Court, G.R. No. 65072, January 31, 1984, 127 SCRA 470; Vda. de Borromeo v. Pogoy,
G.R. No. 63277, November 29, 1983, 126 SCRA 217; Morata v. Go, G.R. No. 62339,
October 27, 1983, 125 SCRA 444]. However, failure to raise it as a defense in the answer
or in a timely motion to dismiss is deemed a waiver of such precondition.

The record shows that petitioners' answer to the complaint never raised the defense that
the private respondents' complaint did not comply with the conciliation process prescribed
by Pres. Dec. No. 1508. The failure to raise said defense in the answer is deemed a
waiver thereof which no belated motion to dismiss can rectify.

Moreover, there is no merit to the petitioners' contention that private respondents' failure
to comply with the conciliation process is fatal to the trial court's jurisdiction. The

Page 90 of 100
FIRST DIVISION THE LOWER COURT ERRED IN ORDERING THE EVICTION OF DEFENDANTS-
APPELLANTS AND INTERVENORS-APPELLANTS, IN VIOLATION OF SECTION 2 OF
G.R. No. 94436             April 30, 1991 P.D. NO. 2106.

LAGRIMAS V. ABALOS and JOSEFINA A. PANGAN, heir of the late Jose R. III
Abalos, petitioners, vs.
THE HON. COURT OF APPEALS, PEPITO LACULOB, NICOLAS LACURUM, MATEO ASSUMING IN GRATIA ARGUMENTI THAT THE DECISION OF THE LOWER COURT
RESPICIO, LUIS DE LA CRUZ, BENJAMIN MARACHA, FEDERICO MIONES and EVICTING DEFENDANTS-APPELLANTS FROM THE PROPERTY IS NOT VIOLATIVE
ONOFRE FUJIWARA, JR., respondents. OF THE LAW, STILL THE LOWER COURT ERRED IN ORDERING SUCH EVICTION
WITHOUT A SURVEY OF THE PROPERTY BY A DULY LICENSED SURVEYOR TO
Benjamin P. Quitoriano for petitioners. DETERMINE THE EXACT LOCATION OF THE HOUSES OF DEFENDANTS-
Jeremias Zapata for private respondents. APPELLANTS AND INTERVENORS APPELLANTS IN RELATION TO THE PROPERTY.2

GANCAYCO, J.: In due course, the appellate court promulgated a decision on February 26, 1990 setting
aside the appealed judgment, dismissing the complaint and counterclaims with costs
The focal issue in this case is the legal effect of Presidential Decree No. 1508 in the against the plaintiff-appellees therein. A motion for reconsideration thereof filed by the
resolution of the suit where the parties nevertheless proceeded to the trial of the case plaintiffs was denied on July 6, 1990.
until judgment was rendered.
Hence, this petition for review of said decision and resolution the main thrust of which is
On July 22, 1983, a complaint for recovery of possession of property and damages was that the appellate court erred in dismissing the complaint for failure to go through the
filed by spouses Jose R. Abalos and Lagrimas V. Abalos against private respondents in the pre-litigation process under P.D. No. 1508 and to order the respondent court to resolve
Regional Trial Court, Quezon City, designated as Lot 12, Block 122-D, situated in Quezon the merits of the appeal.
City with an area of about 408 square meters, registered in the name of the Abalos
spouses under TCT No. 287646 issued by the Register of Deeds of Quezon City. The petition is impressed with merit.

After the issues were joined and the trial on the merits, a decision was rendered by the It is true that in the complaint, the residence of plaintiffs (petitioners herein) was alleged
trial court on May 20, 1986, the dispositive part of which reads as follows: to be at 77 West Avenue, Quezon City, while the private respondents were alleged to be
at Lot 12, Block E-122 D Bo. Piñahan Quezon City. In the answer of private respondents
ACCORDINGLY, in the light of the foregoing disquisition, judgment is hereby rendered — they allege, among others, that the court has not acquired jurisdiction over the case as
there was no previous compliance with the conciliation requirement under P.D. No. 1508.
1) Adjudging the plaintiffs Jose R. Abalos and Lagrimas V. Abalos as the true In their reply and answer to the counterclaim, the petitioners, with leave of court,
and lawful registered owners of the property covered by TCT No. 287646; changed and corrected their address to 552 Reparo St., Caloocan City, as their correct
residence. Private respondents did not object thereto.
2) Ordering the intervenors Federico Miones and Onofre Fujiwara, Jr., the
defendants Mateo Respicio Luis de la Cruz and Benjamin Maracha and all The trial court as above related decided the case on the merits and rendered a judgment
persons claiming rights under them, to vacate the premises and to remove their for the petitioners. However, the appellate court dismissed the complaint on the ground
houses thereon within sixty (60) days from the finality of this decision; and that there was a failure to bring the despite for possible conciliation conference at the
barangay level.
3) In the event of failure or refusal by the said defendants and intervenors to
vacate the premises and remove their houses on plaintiffs' land within the From the foregoing set of facts, the requirement of conciliation before the barangay
period herein specified, ordering each of the aforesaid defendants and where the property is located cannot be enforced. Petitioners reside in Caloocan City
intervenors to pay the plaintiffs the amount of P250.00 a month, until said while private respondents reside at Barangay Pinahan Quezon City. Section 2 of P.D. No.
defendants and all persons claiming right under them shall have vacated the lot 1508 provides as follows:
in question and removed all improvements thereon.
Sec. 2. Subject matter for amicable settlement. — The Lupon of each barangay
Without pronouncement as to cost. shall have authority to bring together the parties actually residing in the same
city or municipality for amicable settlement of all disputes except:
SO ORDERED.1
1) Where one party is the government, or any subdivision or
Private respondents appealed to the Court of Appeals raising the following issues —
instrumentality thereof;
I
2) Where one party is a public officer or employee, and the dispute
THE LOWER COURT ERRED IN NOT DISMISSING THE CASE FOR FAILURE TO relates to the performance of his official functions;
COMPLY WITH THE CONCILIATION PROCESS PROVIDED FOR IN SECTION 6 OF
3) Offenses punishable by imprisonment exceeding 30 days, or a fine
P.D. NO. 1508, OTHER-WISE KNOWN AS THE KATARUNGAN
exceeding P200.00;
PANGBARANGAY LAW.
4) Offenses where there is no private offended party;
II

Page 91 of 100
 5) Such other classes of disputes which the Prime Minister may in the
interest of justice determine, upon recommendation of the Minister of
Justice and the Minister of Local Government.

Moreover, while private respondents raise this defense in their answer, they effectively
waived their right thereto when they failed to object to the correction of the residence of
petitioners from Quezon City to Caloocan City, in the reply, with leave of the court. And
without raising this issue any further, private respondents participated in the trial of the
merits of the case.

The fact that private respondents took part in the trial, argued their case and adduced
their evidence amounts to a waiver of this defense.

Of course, the respondent court nevertheless opined that the true address of petitioners
is in Quezon City and not in Caloocan City as the reply stating the change of residence
was made only by petitioners after the issue of non-compliance with Presidential Decree
No. 1508 was raised and that the reply was not verified unlike the complaint.

The Court is not persuaded. The finding of the respondent court is based on surmises and
assumptions.1âwphi1 It should be predicated on the facts brought before it. Petitioners
asserted that their true address is in Caloocan City. Private respondents did not object
thereto and even went to the trial on the merits It was only when the judgment against
private respondents was rendered that they remembered to raise anew and on appeal the
non-compliance with Presidential Decree No. 1508. It is much too late. The conclusion of
the respondent court that petitioners were not being truthful in correcting their place of
residence is totally without basis. On the contrary, in this case, it appears the defense of
non-compliance with P.D. No. 1508 was availed of by private respondents only to further
delay the determination of the merits of the case.

No rule is more settled than that once a party to a case submits to the jurisdiction of the
court and participates in the trial on the merits of the case, he cannot thereafter, upon a
judgment unfavorable to his cause, take a total turn about and say that the condition
precedent of compliance with P.D. No. 1508 had not been met. One cannot have the cake
and eat it too.

WHEREFORE, the petition is GRANTED and the appealed judgment of the appellate court
dated February 26, 1990 and its resolution dated July 6, 1990 are hereby SET ASIDE. Let
the records of the case be remanded to the appellate court for a determination of the
merits of the appeal with deliberate dispatch. No costs in this instance.

SO ORDERED.

Narvasa, Cruz, Griño-Aquino and Medialdea, JJ., concur.

Page 92 of 100
SECOND DIVISION On the other hand, the Solicitor General, as counsel for the public respondent NLRC, in
his comment, strongly argues and convincingly against the applicability of P.D. No. 1508
G.R. No. 82211-12 March 21, 1989 to labor cases.

TERESITA MONTOYA, petitioner, vs. We dismiss the petition for lack of merit, there being no satisfactory showing of any grave
TERESITA ESCAYO, JOY ESCAYO, AIDA GANANCIAL, MARY ANN CAPE, CECILIA abuse of discretion committed by the public respondent.
CORREJADO, ERLINDA PAYPON and ROSALIE VERDE, AND NATIONAL LABOR
RELATIONS COMMISSION, respondents. The provisions of P.D. No. 1508 requiring the submission of disputes before the barangay
Lupong Tagapayapa prior to their filing with the court or other government offices are not
Rolando N. Medalla and Segundo Y Chua for petitioner. applicable to labor cases.
The Solicitor General for public respondent.
Archie S. Baribar for private respondents. For a better understanding of the issue in this case, the provisions of P.D. No. 1508
invoked by the petitioner are quoted:
SARMIENTO, J.:
SEC. 6. Conciliation pre-condition to filing of complaint. No complaint, petition,
This petition for certiorari seeks the annullment and setting aside of the action or proceeding involving any matter within the authority of the Lupon as
resolution 1 9dated August 20, 1987 of the National Labor Relations Commission (NLRC), provided in Section 2 hereof shall be filed or instituted in court or any other
Third Division, which reversed and set aside the order dated September 27, 1985 of government office for adjudication unless there has been a confrontation of the
Labor Arbiter Ethelwoldo R. Ovejera of the NLRC's Regional Arbitration Branch No. VI, parties before the Lupon Chairman or the Pangkat and no conciliation or
Bacolod City, dismissing the complaint filed by the private respondents against the settlement has been reached as certified by the Lupon Secretary or the Pangkat
petitioner. This petition raises a singular issue, i.e., the applicability of Presidential Decree Secretary, attested by the Lupon or Pangkat Chairman, or unless the settlement
(P.D.) No. 1508, more commonly known as the Katarungang Pambarangay Law, to labor has been repudiated. However, the parties may go directly to court in the
disputes. following cases:

The chronology of events leading to the present controversy is as follows: (1) Where the accused is under detention;

The private respondents were all formerly employed as salesgirls in the petitioner's store, (2) Where a person has otherwise been deprived of per sonal liberty calling for
the "Terry's Dry Goods Store," in Bacolod City. On different dates, they separately filed habeas corpus proceedings;
complaints for the collection of sums of money against the petitioner for alleged unpaid
overtime pay, holiday pay, 13th month pay, ECOLA, and service leave pay: for violation (3) Actions coupled with provisional remedies such as preliminary injunction,
of the minimum wage law, illegal dismissal, and attorney's fees. The complaints, which attachment, delivery of personal property and support pendente lite; and
were originally treated as separate cases, were subsequently consolidated on account of
the similarity in their nature. On August 1, 1984, the petitioner-employer moved (Annex (4) Where the action may otherwise be barred by the Statute of Limitations.
"C" of Petition) for the dismissal of the complaints, claiming that among others, the
private respondents failed to refer the dispute to the Lupong Tagapayapa for possible As correctly pointed out by the Solicitor General in his comment to the petition, even from
settlement and to secure the certification required from the Lupon Chairman prior to the the three "WHEREAS" clauses of P.D. No. 1508 can be gleaned clearly the decree's
filing of the cases with the Labor Arbiter. These actions were allegedly violative of the intended applicability only to courts of justice, and not to labor relations commissions or
provisions of P.D. No. 1508, which apply to the parties who are all residents of Bacolod labor arbitrators' offices. The express reference to "judicial resources", to "courts of
City. justice", "court dockets", or simply to "courts" are significant. On the other band, there is
no mention at all of labor relations or controversies and labor arbiters or commissions in
Acting favorably on the petitioner's motion, Labor Arbiter Ethelwoldo R. Ovejera, on the clauses involved.
September 27, 1985, ordered the dismissal of the complaints. The private respondents
sought the reversal of the Labor Arbiter's order before the respondent NLRC. On August These "WHEREAS" clauses state:
20, 1987, the public respondent rendered the assailed resolution reversing the order of
Ovejera, and remanded the case to the Labor Arbiter for further proceedings. A motion WHEREAS, the perpetuation and official recognition of the time-honored
for reconsideration was filed by the petitioner but this was denied for lack of merit on tradition of amicably settling disputes among family and barangay members at
October 28, 1987. Hence, this petition. the barangay level without judicial resources would promote the speedy
administration of justice and implement the constitutional mandate to preserve
It is the petitioner's contention that the provisions of the Katarungang Pambarangay Law and develop Filipino culture and to strengthen the family as a basic social
(P.D. No. 1508) relative to the prior amicable settlement proceedings before the Lupong institution;
Tagapayapa as a jurisdictional requirement at the trial level apply to labor cases. More
particularly, the petitioner insists that the failure of the private respondents to first submit WHEREAS, the indiscriminate filing of cases in the courts of justice contributes
their complaints for possible conciliation and amicable settlement in the proper barangay heavily and unjustifiably to the congestion of court dockets, thus causing a
court in Bacolod City and to secure a certification from the Lupon Chairman prior to their deterioration in the quality of justice;
filing with the Labor Arbiter, divests the Labor Arbiter, as well as the respondent
WHEREAS, in order to help relieve the courts of such docket congestion and
Commission itself, of jurisdiction over these labor controversies and renders their
thereby enhance the quality of Justice dispensed by the courts, it is deemed
judgments thereon null and void.
desirable to formally organize and institutionalize a system of amicably settling
disputes at the barangay level; (Emphasis supplied.)

Page 93 of 100
In addition, Letter of Instructions No. 956 and Letter of Implementation No. 105, both unduly delay the disposition of the labor case. The fallacy of the petitioner's submission
issued on November 12, 1979 by the former President in connection with the can readily be seen by following it to its logical conclusion. For then, if the procedure
implementation of the Katarungang Pambarangay Law, affirm this conclusion. These suggested is complied with, the private respondent would have to lodge first their
Letters were addressed only to the following officials: all judges of the Courts of first complaint with the barangay court, and then if not settled there, they would have to go to
Instance, Circuit Criminal Courts, Juvenile and Domestic Relations Courts, Courts of the labor relations division at the Regional Office of Region VI of the Department of Labor
Agrarian Relations, City Courts and Municipal Courts, and all Fiscals and other Prosecuting and Employment, in Bacolod City, for another round of conciliation proceedings. Failing
Officers. These presidential issuances make clear that the only official directed to oversee there, their long travail would continue to the Office of the Labor Arbiter, then to the
the implementation of the provisions of the Katarungang Pambarangay Law (P.D. No. NLRC, and finally to us. This suggested procedure would destroy the salutary purposes of
1508) are the then Minister of Justice, the then Minister of Local Governments and P.D. 1508 and of The Labor Code Of The Philippines. And labor would then be given
Community Development, and the Chief Justice of the Supreme Court. If the contention another unnecessary obstacle to hurdle. We reject the petitioner's submission. It does
of the petitioner were correct, the then Minister (now Secretary) of Labor and violence to the constitutionally mandated policy of the State to afford full protection to
Employment would have been included in the list, and the two presidential labor. 2
issuances also would have been addressed to the labor relations officers, labor arbiters,
and the members of the National Labor Relations Commission. Expressio unius est Finally, it is already well-settled that the ordinary rules on procedure are merely
exclusio alterius. suppletory in character vis-a-vis labor disputes which are primarily governed by labor
laws. 3 And "(A)ll doubts in the implementation and interpretation of this Code (Labor),
Nor can we accept the petitioner's contention that the "other government office" referred including its implementing rules and regulations, shall be resolved in favor of labor. 4
to in Section 6 of P.D. No. 1508 includes the Office of the Labor Arbiter and the Med-
Arbiter. The declared concern of the Katarungan Pambarangay Law is "to help relieve the WHEREFORE, the petition is DISMISSED. Costs against the petitioner.
courts of such docket congestion and thereby enhance the quality of justice dispensed by
the courts." Thus, the" other government office" mentioned in Section 6 of P.D. No. 1508 SO ORDERED.
refers only to such offices as the Fiscal's Office or, in localities where there is no fiscal, the
Municipal Trial Courts, where complaints for crimes (such as those punishable by Melencio-Herrera, (Chairperson), Paras, Padilla and Regalado, JJ., concur.
imprisonment of not more than 30 days or a, fine of not more than P 200.00) falling
under the jurisdiction of the barangay court but which are not amicably settled, are
subsequently filed for proper disposition.

But, the opinion of the Honorable Minister of Justice (Opinion No. 59, s. 1983) to the
contrary notwithstanding, all doubts on this score are dispelled by The Labor Code Of The
Philippines (Presidential Decree No. 442, as amended) itself. Article 226 thereof grants
original and exclusive jurisdiction over the conciliation and mediation of disputes,
grievances, or problems in the regional offices of the Department of Labor and Employ-
ment. It is the said Bureau and its divisions, and not the barangay Lupong Tagapayapa,
which are vested by law with original and exclusive authority to conduct conciliation and
mediation proceedings on labor controversies before their endorsement to the appropriate
Labor Arbiter for adjudication. Article 226, previously adverted to is clear on this regard.
It provides:

ART. 226. Bureau of Labor Relations.- The Bureau of Labor Relations and the
Labor relations divisions in the regional officer of the Department of Labor shall
have original and exclusive authority to act, at their own initiative or upon
request of either or both parties, on all inter-union and intra-union conflicts, and
all disputes, grievances or problems arising from or affecting labor-management
relations in all workplaces whether agricultural or non-agricultural, except those
arising from the implementation or interpretation of collective bargaining
agreements which shall be the subject of grievance procedure and/or voluntary
arbitration.

The Bureau shall have fifteen (15) working days to act on all labor cases,
subject to extension by agreement of the parties, after which the Bureau shall
certify the cases to the appropriate Labor Arbiters. The 15-working day
deadline, however, shall not apply to cases involving deadlocks in collective
bargaining which the Bureau shall certify to the appropriate Labor Arbiters only
after all possibilities of voluntary settlement shall have been tried.

Requiring conciliation of labor disputes before the barangay courts would defeat the very
salutary purposes of the law. Instead of simplifying labor proceedings designed at
expeditious settlement or referral to the proper court or office to decide it finally, the
position taken by the petitioner would only duplicate the conciliation proceedings and

Page 94 of 100
SECOND DIVISION individual suits against the respective defendants therein, the former were merely
transient residents of 1284 Burgos Street, Pandacan, Manila. Defendants' invocation of
G.R. No. 79404 January 27, 1989 P.D. 1517 was given short shrift in view of the doctrine laid down by this Court in  Santos,
et. al. vs. Court of appeals, et al.,  3 holding that —
SPOUSES FELICIANO BEJER and GLORIA BEJER, petitioners, vs.
THE HONORABLE COURT OF APPEALS and SPOUSES SOLANO SAMAR and "JOHN ... P.D. No. 1517, in referring to the pre-emptive or redemptive right of a lessee
DOE/S", respondents. speaks only of urban land under lease on which a tenant has built his home and
in which he has resided for ten years or more. If both land and the building
G.R. No. 80045 January 27, 1989 belong to the lessor, the right referred to hereinabove does not apply.
SPOUSES FELICIANO BEJER and GLORIA BEJER, petitioners, vs. Therein defendant Samar spouses appealed to the Regional Trial Court which
THE HONORABLE COURT OF APPEALS and SPOUSES ELIAS ESPLANO and "JOHN affirmed 4 the judgment of the lower court, further pointing out that therein plaintiffs
DOE/S', respondents. "occasional visits to the Pandacan apartment of their children do not make plaintiffs
'ACTUAL RESIDENTS' of that place. In short, plaintiffs are as strangers to the community
F.M. Natividad & Associates for petitioners. at Burgos Street, Pandacan, Manila as they can be." With respect to defendants' reliance
Joselito R. Enriquez for respondents. on P.D. 1517 and P.D. 2016, it was additionally noted that said decrees require that the
area must be defined and proclaimed to be within a specified Urban Land Reform
REGALADO, J.:
Zone, 5 that is, the 245 depressed areas covered by Proclamation No. 1967 and within the
Considering the identity of petitioner lessors, the subject matter and the issues in these Area of Priority Development and the ZIP Program of the Government. The premises in
two cases, and that the respondents therein are tenants in the same property involved, a controversy were within an area not yet proclaimed by only being recommended for
joint decision is indicated. feasibility study for the Zonal Improvement Program. 6

An identical pivotal issue, which would be determinative of the present recourses in both Therein defendants elevated the case on a petition for review to the Court of
cases, presents itself for resolution by the Court: Does P.D. 1508 (Katarungang Appeals, 7 which, in its decision on July 23, 1987 sustained the ruling on the
Pambarangay Law), which requires the compulsory process of conciliation as a pre- inapplicability of P.D. 1517. 8 However, it held that P.D. 1508 was applicable to the case
condition for filing a case in court, apply where the plaintiffs are permanent residents of although the therein private respondents were only "temporarily residing" at 1284 Burgos
another province but, at the time of the institution of the action, are temporarily residing Street, Pandacan, Manila" since P.D. 1508 merely requires that the parties are "actually
for a transient purpose in the same city where the defendants reside? residing' in the place involved. The decisions of the two lower courts were consequently
set aside and the ejectment case was dismissed on the ground of lack of cause of action
The petitioners in these cases are the owners of a parcel of land and the building erected or pre-maturity. 9
thereon located at and known as No. 1162-B San Andres St., Malate, Manila. In 1984, the
petitioners entered into a verbal contract of lease with the Samar spouses, respondents in Herein petitioners fared no better in their case against the Esplano spouses who likewise
G.R. 79404, on a month-to-month basis over a portion of the said premises at a monthly appealed from the aforesaid consolidated decision of the Metropolitan Trial Court to the
rental of P75.00. In September, 1985, petitioners notified said respondents of their need Regional Trial Court of Manila 10 which affirmed in toto the decision of the lower court.
to repossess the leased premises for their own use and due to the immediate need However, on a petition for review in the Court of Appeals, the decision of the trial court
therefor by their family, and granted the respondents up to December 31, 1985 to vacate was set aside and the complaint for ejectment was dismissed likewise for lack of cause of
the premises. Respondents stayed on and despite another 3-month notice to pay and action or pre-maturity. Said decision 11 of the Sixth Division of respondent Court of
vacate they not only failed to do so but refused to pay their monthly rentals from Appeals specifically adverted to and noted with approval the aforesaid decision of the
December, 1985, hence the petitioners filed a complaint against them on April 21, 1986 Fourteenth Division in CA-G.R. SP. No. 11697.
in the Metropolitan Trial Court of Manila. 1
Both decisions of the respondent court are now before Us presenting the same
The same antecedent facts obtain with respect to the respondent Esplano spouses, determinant issue stated at the outset of this decision.
involved in G.R. No. 80045, against whom a separate complaint was filed and raffled to
Prefatorily, this Court has heretofore repeatedly held that non-compliance with P.D. 1508
the same trial court. The aforesaid two cases, together with that against a third tenant-
does not warrant jurisdictional objections; non-availment of the conciliation process
defendant but which is not involved in these appellate proceedings, were the subjects of a
required therein only renders the complaint vulnerable to a timely motion to dismiss for
consolidated decision of the lower court 2 rendered on November 7, 1986 ordering therein
lack of cause of action or prematurity. 12 The private respondents in the two cases at bar
defendants and all persons claiming rights under them to vacate their respective leased
seasonably raised that affirmative defense in their respective answers filed in the
premises; to pay the rentals from December, 1985 until they shall have vacated the
court a quo, hence waiver of such objection or estoppel by laches are not in issue in the
premises, with legal interest thereon; and to individually pay P1,000.00 as attorney's
present controversy.
fees, plus costs of suit.
Instead, the contending parties have locked their argumentative horns on the nature or
In said cases, the defendants, respondents herein, duly raised in their respective answers
concept of the "residence" requirement in P.D. 1508, the petitioners contending that
the defenses of lack of cause of action of the plaintiffs and/or that the lower court had no
permanent residence is required for the application thereof, while the private respondents
jurisdiction for non-compliance with the conciliation requirement of P.D. 1508; and further
insist that all that is required is actual residence, whether temporary or permanent, at the
that they could not be ejected by reason of the applicability and proscription in their favor
time the dispute arose. In procedural law, however, specifically for purposes of venue it
of P.D. 1517 (Urban Land Reform Law) in relation to P.D. 1520.
has been held that the residence of a person is his personal, actual or physical habitation
However, the lower court held that P.D. 1508 was not applicable in both cases since the or his actual residence or place of abode, 13 which may not necessarily be his legal
plaintiffs were actual residents of Orense, Bauan, Batangas and, at the time of filing the residence or domicile provided he resides therein with continuity and consistency, 14 thus:

Page 95 of 100
 ... We lay down the doctrinal rule that the term 'resides' connotes ex vi Sec. 114. Amicable Settlement of Disputes on the Barangay Level. There shall
termini  'actual residence' as distinguished from 'legal residence or domicile'. The be a system of amicable settlement of disputes on the barangay level which
term 'resides', like the term 'residing' or 'residence' is elastic and should be shall be governed by law.
interpreted in the light of the object or purpose of the statute or rule in which it
is employed. ... In other words, 'resides' should be viewed or understood in its Incidentally, the importance of membership, and not mere actual residence, in the
popular sense, meaning, the personal, actual or physical habitation of a person, barangay is underscored by the requirement that it must have an actual population of at
actual residence or place of abode. It signifies physical presence in a place and least one thousand inhabitants, 18 which cannot but mean barangay members actually
actual stay thereat. ... No particular length of time of residence is required residing therein. Membership in the barangay is also required for candidacy to an office
though; however, the residence must be more than temporary  (Emphasis therein, 19 to be considered as persons in authority 20 and for membership in the
supplied). kabataang barangay assembly. 21

Parenthetically, the lower courts held that herein petitioners are permanent residents of Turning now to the cases at bar, there is no dispute that the petitioners are not members
Orense, Bauan, Batangas, although they periodically come to visit and stay for a few days of the barangay in question. There is no evidence of that fact nor was there a certification
at the aforesaid place in Pandacan where their children live while attending classes. Both that they are residents of 1284 Burgos Street, Pandacan, Manila, in contrast to the
complaints filed by them in the Metropolitan Trial Court also state that they are "residents respondents in both cases whose residence at 1162-B San Andres Street, Malate, Manila
of Orense, Bauan, Batangas, and temporarily residing at 1284 Burgos Street, Pandacan, was certified to by the barangay chairman thereof. 22 Petitioners cannot even be
Manila." Tested by the rules on sufficiency of pleadings, it is readily apparent that the accurately categorized as temporary residents but as mere periodic and brief sojourners
allegation regarding their temporary residence should be treated as an inconsequential who only used to come to visit and attend to their children's needs while in school. From
surplusage. However, as already stated, respondents' reliance is place squarely and all the foregoing disquisitions, therefore, we cannot confer in the existence of the
literally on the reference of P.D. 1508 to persons "actually residing" in the barangays as requisite residential or, for purposes of the issue involved, the legal nexus between the
the rationale for its applicability. We feel, however, that for an adequate denouement the petitioners and the Pandacan barangay involved.
inquiry should go farther than such statutory provisions.
The literalism in respondents' suggested construction of the pertinent provisions of P.D.
It will be noted that the first preambular paragraph of P.D. 1508 15 provides: 1508 may even result in unwanted, if not absurd, results not contemplated in and
contrary to its purposes. For instance, if a transient visitor, like the herein petitioners,
Whereas, the perpetuation and official recognition of the time-honored tradition obtains a loan of P15,000.00 on a verbal agreement from a barangay member during the
of amicably settling disputes among family and barangay members at the former's brief stay in that barangay in Manila and fails to pay the same but, like the
barangay level without judicial recourse would promote the speedy petitioners herein, he is a resident of Batangas, following respondents' theory prior
administration of justice and implement the constitutional mandate to preserve conciliation proceedings must first be conducted in said Manila barangay before suit may
and develop Filipino culture and to strengthen the family as a basic social be brought in the municipal trial court in Batangas as the court of proper venue. This
institution;' (Emphasis supplied). situation could not have been within the intendment of P.D. 1508.

Evidently, therefore, the primary purpose of P.D. 1508 is to provide the conciliation On the equities of these cases, it bears mention that petitioners and their family have
mechanism, as an alternative to litigations in dispute settlement, to member of the been prevented up to now from repossessing their own house and lot for their use despite
corresponding barangays who are actually residing therein. Residence alone, without their demonstrated compliance with the legal requirements therefor as found by the two
membership, in said barangays would not be an accurate and reliable criterion, courts below, and that the respondents have deliberately refused to pay the respective
considering that such residence may be actual but be merely temporary, transient or stipulated rentals for their occupancy of said premises.
categorized into other permutations as in the case of a house guest or a sojourner on a
visit of a day or two. On the other hand, mere membership in a barangay, without actual WHEREFORE, judgment is hereby rendered SETTING ASIDE the assailed decisions of the
residence therein, should not suffice since absentee membership would not subserve the Fourteenth and Sixth Divisions of the respondent Court of Appeals in CA-G.R. SP. No.
avowed purpose of P.D. 1508 for lack of the common bond and sense of belonging 11697 and CA G.R. No. SP-11893, respectively; REINSTATING the decisions of the
generally fostered in members of an Identified aggroupment. Regional Trial Court of Manila in Civil Cases Nos. 87-39033 and 87-39032 thereof, and
ORDERING the respondents to vacate the premises in question and surrender possession
Hence, the Local Government Code16 thereafter specifically provided 17 for the thereof to the petitioners. This decision is immediately EXECUTORY.
appointment of a barangay secretary with the duties, inter alia, to:
SO ORDERED.
xxx xxx xxx
Melencio-Herrera (Chairperson), Paras, Padilla and Sarmiento, JJ., concur.
(c) Prepare separate lists of the members of the barangay and the registered
voters of the barangay assembly, and have the same posted on conspicuous
places within the barangay;

(d) Register all new members of the barangay;'

xxx xxx xxx

That such regulatory provisions in B.P. 337 on barangays should be read conjointly with
and applies to P.D. 1508 is shown by the provision in the former as follow:

Page 96 of 100
EN BANC On May 5, 1999, Escueta and Llanera, and the sub-lessees, executed an "Amicable
Settlement,"9 where they agreed that (a) the owners of the property would no longer
G.R. No. 156228               December 10, 2003 collect the rentals due from the respondents therein (lessee and sub-lessees) starting
May 1999, with the concomitant obligation of the respondents to vacate the property on
MA. TERESA VIDAL, LULU MARQUEZ, and CARLOS SOBREMONTE, petitioners, vs. or before December 1999; (b) time was the essence of the agreement, and that
MA. TERESA O. ESCUETA, represented by HERMAN O. ESCUETA, respondent. consequently, if the lessee and sub-lessees fail or refuse to vacate the property on or
before December 1999, the barangay chairman was authorized without any court order to
DECISION cause the eviction and removal of all the respondents on the property. 10 The amicable
settlement was attested by Pangkat Chairman Jose Acong. The parties did not repudiate
CALLEJO, SR., J.:
the amicable settlement within ten days from the execution thereof. Neither did any of
This is a petition for review of the Decision 1 dated July 23, 2002 of the Court of Appeals in the parties file any petition to repudiate the settlement.
CA-G.R. SP NO. 68895 which affirmed the decision2 of the Regional Trial Court (RTC) of
The vendees having paid the down payment and second installment of the price of the
Mandaluyong City, Branch 208, which reversed and set aside the decision 3 of the
property, the vendors caused the cancellation on December 17, 1999, of TCT No. 27568
Metropolitan Trial Court of Mandaluyong City (MTC), Branch 60; and granted the motion
and the issuance of TCT No. 15324 to and under the names of the vendees Mary Liza
for execution filed by private respondent Ma. Teresa O. Escueta in Civil Case No. 17520.
Santos, Susana Lim and Johnny Lim. 11 However, Escueta and the other vendors had yet to
The petition at bar stemmed from the following antecedents: receive the balance of the purchase price of P1,000,000.00 because the respondents were
still in the property.
When Abelardo Escueta died intestate on December 3, 1994, he was survived by his
widow Remedios Escueta and their six children, including Ma. Teresa O. Escueta and her Llanera vacated the leased premises. Later, twenty of the sub-lessees also vacated the
brother Herman O. Escueta. Part of his estate was a parcel of land located at No. 14 property. By January 2000, five sub-lessees, namely, Ma. Teresa Vidal, Lulu Marquez,
Sierra Madre corner Kanlaon Streets, Barangay Highway Hills, Mandaluyong City, covered Marcelo Trinidad, Carlos Sobremonte, 12 and Jingkee Ang remained in the property, and
by Transfer Certificate of Title (TCT) No. (77083) - 27568, and the house thereon. The requested Escueta for extensions to vacate the property. Escueta agreed, but despite the
property was leased to Rainier Llanera, who sublet the same to 25 persons. The heirs lapse of the extensions granted them, the five sub-lessees refused to vacate the property.
executed an extra-judicial settlement of estate over the property. They also executed a
Escueta opted not to have the sub-lessees evicted through the Punong Barangay as
special power of attorney authorizing Ma. Teresa Escueta to sell the said property. 4
provided for in the amicable settlement. Neither did she file a motion with the Punong
Sometime in 1999, Ma. Teresa Escueta, as a co-owner of the property, filed an ejectment Barangay for the enforcement of the settlement. Instead, she filed on May 12, 2000, a
case against Llanera and the sub-lessees before the Lupon of Barangay Highway Hills, verified "Motion for Execution" against the recalcitrant sub-lessees with the MTC for the
docketed as Barangay Case No. 99-09.5 enforcement of the amicable settlement and the issuance of a writ of execution. The
pleading was docketed as Civil Case No. 17520, with Teresa Escueta as plaintiff, and the
In the meantime, on April 15, 1999, the heirs of Abelardo Escueta executed a deed of sub-lessees as defendants.13
conditional sale6 over the property including the house thereon, to Mary Liza Santos for
₱13,300,000.00 payable as follows: The defendants opposed the motion14 alleging that they were enveigled into executing the
amicable settlement despite the fact that they had not violated any of the terms and
"Down payment – ONE MILLION FIVE HUNDRED THOUSAND (₱1,500,000.00) which the conditions of the verbal lease of the property; they were coerced and forced to enter into
HEIRS-SELLERS acknowledged receipt thereof with complete and full satisfaction; such amicable settlement as it was the only way of prolonging their stay in the leased
premises; and that they had been paying faithfully and religiously the monthly rentals in
Second payment - TEN MILLION EIGHT HUNDRED THOUSAND (₱10,800,000.00) after advance.
publication of the Extra-Judicial Settlement of the Estate of the late Abelardo Escueta and
payment of the taxes with the Bureau of Internal Revenue by the Attorney-in-Fact; and They also contended that the plaintiff came to court with unclean hands, as the property
had been sold by the co-owners thereof on June 8, 1999, without notifying them. The real
The balance of ONE MILLION (₱1,000,000.00) upon vacation of all the occupants of the parties-in-interest as plaintiffs, would be the new owners of the property, and not the
subject property within SIX (6) months from date hereof." 7 Escuetas. The defendants further asserted that the amicable settlement was not elevated
to or approved by the MTC as required by Section 419 of the Local Government Code
The parties further agreed that: (LGC), nor approved by a competent court; hence, there was no judgment to enforce by
a new motion for a writ of execution. As such, the plaintiff’s motion was premature and
"Ms. Maria Teresa Escueta shall deliver unto the BUYER the Owner’s Duplicate Copy of the procedurally improper. The defendants asserted that the plaintiff must first secure a
title upon receipt of the down payment while the original copies of the Special Power of certification to file action from the barangay and thereafter, file an action for ejectment
Attorney shall be delivered upon payment of the Second Payment stated above. against them as required by Section 417 of the LGC. The amicable settlement of the
parties before the Lupon cannot be a substitute for an action for ejectment. Finally, they
The ATTORNEY-IN-FACT-SELLER shall be responsible for the ejectment of all the tenants averred that they had been sub-lessees for more than ten years already; hence, had the
in the said subject property. right of first refusal under Section 6 of the Urban Land Reform Law (P.D. No. 1517). For
her part, the plaintiff asserted that there having been no execution of the amicable
The ATTORNEY-IN-FACT-SELLER shall pay the estate tax, capital gains tax and settlement on or before November 6, 1999 by the Lupon, the settlement may now be
documentary stamp tax including the telephone, water and Meralco bills and the enforced by action in the proper city or municipal court.
publication for the Extra-Judicial Settlement of the estate of the late ABELARDO ESCUETA
while the registration and transfer fees shall be shouldered by the BUYER." 8 On February 22, 2001, the court issued an Order 15 denying the "Motion for Execution."
The court held that the plaintiff was not the real party-in-interest as the subject property
had already been sold and titled to Susana Lim, Johnny Lim and Mary Liza Santos. Only

Page 97 of 100
the vendees had the right to demand the ejectment of the defendants from the said On procedural grounds, the CA ruled that the petitioners failed to indicate the specific
property. The court further ruled that the defendants had the right of first refusal to material dates, showing that their petition was filed on time as required by the rules, and
purchase the property under Presidential Decree No. 1517. The MTC, however, did not in declaring that they failed to justify their failure to do so.
rule on the issue of whether or not the plaintiff’s motion for execution was premature.
On the merits of the petition, the appellate court upheld the ruling of the RTC. The
Aggrieved, the plaintiff, now the appellant, appealed the order to the RTC where she decretal portion of the decision of the CA reads:
contended that:
WHEREFORE, the instant petition is hereby DISMISSED. The assailed Decision of the
THE METROPOLITAN TRIAL COURT COMMITTED THE REVERSIBLE ERROR IN FINDING Regional Trial Court of Mandaluyong City, Branch 208, rendered in Civil Case No. MC01-
AND IN CONCLUDING THAT PLAINTIFF IS NO LONGER THE REAL PARTY-IN-INTEREST. 333-A, dated August 31, 2001 is hereby AFFIRMED.

THE METROPOLITAN TRIAL COURT COMMITTED THE REVERSIBLE ERROR IN FINDING SO ORDERED.19
AND IN CONCLUDING THAT DEFENDANTS CANNOT BE EJECTED AND CAN EXERCISE THE
RIGHT OF FIRST REFUSAL. In their petition at bar, the petitioners assert that the CA erred as follows: (1) in not
applying the rules of procedure liberally; (2) in declaring that there was no need for the
THE METROPOLITAN TRIAL COURT COMMITTED THE REVERSIBLE ERROR IN NOT respondents to file an ejectment case for the eviction of the petitioners; (3) that the real
FINDING AND IN NOT MAKING THE CONCLUSION THAT DEFENDANTS HAVE VIOLATED parties-in-interest as plaintiffs in the MTC were the new owners of the property, Susana
THE FINAL AND EXECUTORY THE WRITTEN AMICABLE SETTLEMENT BETWEEN PARTIES Lim, Johnny Lim and Mary Liza Santos; (4) in not finding that the Amicable Settlement
EXECUTED IN THEIR BARANGAY CONFRONTATION. was obtained through deceit and fraud; and (5) in ruling that the petitioners had no right
of first refusal in the purchase and sale of the subject property under Presidential Decree
THE METROPOLITAN TRIAL COURT COMMITTED THE REVERSIBLE ERROR IN NOT No. 1517.
ORDERING THE EJECTMENT OF THE DEFENDANTS AND IN NOT ORDERING SAID
DEFENDANTS TO PAY THEIR ARREARAGES IN RENTAL PAYMENTS FROM MAY 1999 UP TO The petition is bereft of merit.
THE DAY THEY ACTUALLY LEAVE THE PREMISES AS WELL AS ATTORNEY’S FEES AND
DAMAGES.16 On the procedural issue, the CA dismissed the petition before it for the petitioners’ failure
to comply with Section 2, par. 1, Rule 42 of the 1997 Rules of Civil Procedure. 20 The CA
On August 31, 2001, the RTC rendered a decision holding that the plaintiff-appellant was ratiocinated that there was no justification for a relaxation of the Rules, thus:
still the owner of the property when the ejectment case was filed in the office of the
barangay captain, and, as such, was the real party-in-interest as the plaintiff in the MTC. Petitioners cited decisions of the Supreme Court where a relaxation of procedural rules
Moreover, under the deed of conditional sale between her and the buyers, it was was allowed. However, a reading of those cases shows that they are not exactly similar
stipulated therein that the purchase price of ₱1,000,000.00 would be delivered to the with the present case. In the case of Mactan Cebu International Airport Authority vs.
vendors only "upon the vacation of all the occupants of the subject property within six (6) Francisco Cuizon Mangubat, the Supreme Court allowed the late payment of docket fee by
months from date hereof." She was duty-bound to cause the eviction of the defendant the Solicitor General on the ground that the 1997 Rules of Civil Procedure regarding
from the property; hence, the appellant, as a co-owner, had a substantial interest in the payment of docket fees was still new at that time. The same cannot be said in the present
property. The MTC further held that the sale, having been executed while the appellant’s case. The petition was filed on February 28, 2002, almost five years from the issuance of
complaint was pending with the Lupon, the action in the MTC may be continued by the the 1997 Rules of Civil Procedure. The circumstances of typhoon and holiday for failure to
plaintiff-appellant. obtain a certified true copy of the DOJ’s Decision, in the case of Hagonoy Market Vendor
Association vs. Municipality of Hagonoy, Bulacan, were present in the instant petition. The
As to the right of first refusal being asserted by the appellees, the court ruled that there case of Salazar vs. Court of Appeals is also not similar with the present case.21
was no showing that the land leased had been proclaimed to be within a specific Urban
Land Reform Zone. In fact, the Housing and Land Use Regulatory Board had certified that The petitioners aver in this case that the failure of their counsel to include the material
the subject property was outside the area for priority development; thus, the appellees dates in their petition with the CA was, as stated in their Amended Manifestation, because
may not claim that they had been deprived of their preemptive right when no such right the said counsel was suffering from a slight heart attack. The Court finds the petitioners’
existed in the first place. The court did not rule on the third and fourth issues on the pretext flimsy. If the petitioners’ counsel was able to prepare their petition despite her
ground that the said issues were never raised by the parties. The decretal portion of the condition, there was no valid reason why she failed to include the material dates required
RTC decision reads as follows: under the Rules of Court. Besides, the petitioners stated in their petition that they had
appended a copy of their Amended Manifestation, but failed to do so. If the rules were to
PREMISES CONSIDERED, the appeal is GRANTED. The Order dated February 2, 2001 be applied strictly, the CA could not be faulted for dismissing the petition.
issued by the Metropolitan Trial Court of Mandaluyong City, Branch 60, in Civil Case No.
17520 is hereby REVERSED and SET ASIDE, and a new one is entered granting the However, in order to promote their objective of securing a just, speedy and inexpensive
Motion for Execution. dispensation of every action and proceedings, the Rules are to be liberally
construed.22 Rules of procedure are intended to promote, not to defeat substantial justice
Let the Record of this case be remanded to the court a quo for proper disposition. and, therefore, should not be applied in a very rigid and technical sense. This Court ruled
in Buenaflor vs. Court of Appeals, et al.23 that appeal is an essential part of our judicial
SO ORDERED.17 system and trial courts and the Court of Appeals are advised to proceed with caution so
as not to deprive a party of the right to appeal and that every party litigant should be
A petition for review under Rule 42 was filed with the Court of Appeals by three of the afforded the amplest opportunity for the proper and just disposition of his cause, free
appellees, now petitioners Ma. Teresa Vidal, Lulu Marquez and Carlos Sobremonte. The from the constraints of technicalities. The Court has given due course to petitions where
court, however, dismissed the petition on (1) procedural grounds, and (2) for lack of to do so would serve the demands of substantial justice and in the exercise of its equity
merit. 18

Page 98 of 100
jurisdiction.24 In this case, the Court opts to apply the rules liberally to enable it to delve derogation of the objective of Section 417 of the LGC. The law should be construed and
into and resolve the cogent substantial issues posed by the petitioners. applied in such a way as to reflect the will of the legislature and attain its objective, and
not to cause an injustice. As Justice Oliver Wendell Holmes aptly said, "courts are apt to
We agree with the contention of the petitioners that under Section 416 of the LGC, the err by sticking too closely to the words of the law where these words support a policy that
amicable settlement executed by the parties before the Lupon on the arbitration award goes beyond them. The Court should not defer to the latter that killeth but to the spirit
has the force and effect of a final judgment of a court upon the expiration of ten (10) that vivifieth."29
days from the date thereof, unless the settlement is repudiated within the period therefor,
where the consent is vitiated by force, violence or intimidation, or a petition to nullify the In light of the foregoing considerations, the time line in Section 417 should be construed
award is filed before the proper city or municipal court. 25 The repudiation of the to mean that if the obligation in the settlement to be enforced is due and demandable on
settlement shall be sufficient basis for the issuance of a certification to file a complaint. 26 the date of the settlement, the six-month period should be counted from the date of the
settlement; otherwise, if the obligation to be enforced is due and demandable on a date
We also agree that the Secretary of the Lupon is mandated to transmit the settlement to other than the date of the settlement, the six-month period should be counted from the
the appropriate city or municipal court within the time frame under Section 418 of the date the obligation becomes due and demandable.
LGC and to furnish the parties and the Lupon Chairman with copies thereof. 27 The
amicable settlement which is not repudiated within the period therefor may be enforced Parenthetically, the Katarungang Pambarangay Implementing Rules and Regulations, Rule
by execution by the Lupon through the Punong Barangay within a time line of six months, VII, Section 2 provides:
and if the settlement is not so enforced by the Lupon after the lapse of the said period, it
may be enforced only by an action in the proper city or municipal court as provided for in SECTION 2. Modes of Execution. - The amicable settlement or arbitration award may be
Section 417 of the LGC of 1991, as amended, which reads: enforced by execution by the Lupon within six [6] months from date of the settlement or
date of receipt of the award or from the date the obligation stipulated in the settlement or
SEC. 417. Execution. – The amicable settlement or arbitration award may be enforced by adjudged in the arbitration award becomes due and demandable. After the lapse of such
execution by the Lupon within six (6) months from the date of the settlement. After the time, the settlement or award may be enforced by the appropriate local trial court
lapse of such time, the settlement may be enforced by action in the proper city or pursuant to the applicable provisions of the Rules of Court . An amicable settlement
municipal court. (Underlining supplied). reached in a case referred by the Court having jurisdiction over the case to the Lupon
shall be enforced by execution by the said court. (Underlining supplied).
Section 417 of the Local Government Code provides a mechanism for the enforcement of
a settlement of the parties before the Lupon. It provides for a two-tiered mode of By express provision of Section 417 of the LGC, an action for the enforcement of the
enforcement of an amicable settlement executed by the parties before the Lupon, settlement should be instituted in the proper municipal or city court. This is regardless of
namely, (a) by execution of the Punong Barangay which is quasi-judicial and summary in the nature of the complaint before the Lupon, and the relief prayed for therein. The venue
nature on mere motion of the party/parties entitled thereto; 28 and (b) by an action in for such actions is governed by Rule 4, Section 1 of the 1997 Rules of Civil Procedure, as
regular form, which remedy is judicial. Under the first remedy, the proceedings are amended. An action for the enforcement of a settlement is not one of those covered by
covered by the LGC and the Katarungang Pambarangay Implementing Rules and the Rules on Summary Procedure in civil cases; 30 hence, the rules on regular procedure
Regulations. The Punong Barangay is called upon during the hearing to determine solely shall apply, as provided for in Section 1, Rule 5 of the Rules of Civil Procedure, as
the fact of non-compliance of the terms of the settlement and to give the defaulting party amended.31
another chance at voluntarily complying with his obligation under the settlement. Under
the second remedy, the proceedings are governed by the Rules of Court, as amended. As to the requisite legal fees for the filing of an action in the first level court under Section
The cause of action is the amicable settlement itself, which, by operation of law, has the 417 of the Local Government Code, indigents-litigants (a) whose gross income and that of
force and effect of a final judgment. their immediate family do not exceed ten thousand (P10,000.00) pesos a month if
residing in Metro Manila, and five thousand (P5,000.00) pesos a month if residing outside
Section 417 of the LGC grants a party a period of six months to enforce the amicable Metro Manila, and (b) who do not own real property with an assessed value of more than
settlement by the Lupon through the Punong Barangay before such party may resort to fifty thousand (P50,000.00) pesos shall be exempt from the payment of legal fees.
filing an action with the MTC to enforce the settlement. The raison d’ etre of the law is to Section 18, Rule 141 of the Revised Rules of Court, as amended by A.M. No. 00-2-01-SC,
afford the parties during the six-month time line, a simple, speedy and less expensive is hereby further amended accordingly.
enforcement of their settlement before the Lupon.
In this case, the parties executed their Amicable Settlement on May 5, 1999. However,
The time line of six months is for the benefit not only of the complainant, but also of the the petitioners were obliged to vacate the property only in January 2000, or seven
respondent. Going by the plain words of Section 417 of the LGC, the time line of six months after the date of the settlement; hence, the respondent may enforce the
months should be computed from the date of settlement. However, if applied to a settlement through the Punong Barangay within six months from January 2000 or until
particular case because of its peculiar circumstance, the computation of the time line from June 2000, when the obligation of the petitioners to vacate the property became due. The
the date of the settlement may be arbitrary and unjust and contrary to the intent of the respondent was precluded from enforcing the settlement via an action with the MTC
law. To illustrate: Under an amicable settlement made by the parties before the Lupon before June 2000. However, the respondent filed on May 12, 2000 a motion for execution
dated January 15, 2003, the respondents were obliged to vacate the subject property on with the MTC and not with the Punong Barangay. Clearly, the respondent adopted the
or before September 15, 2003. If the time line of six months under Section 417 were to wrong remedy. Although the MTC denied the respondent’s motion for a writ of execution,
be strictly and literally followed, the complainant may enforce the settlement through the it was for a reason other than the impropriety of the remedy resorted to by the
Lupon only up to July 15, 2003. But under the settlement, the respondent was not obliged respondent. The RTC erred in granting the respondent’s motion for a writ of execution,
to vacate the property on or before July 15, 2003; hence, the settlement cannot as yet be and the CA erred in denying the petitioners’ petition for review.
enforced. The settlement could be enforced only after September 15, 2003, when the
respondent was obliged to vacate the property. By then, the six months under Section Normally, the Court would remand the case to the Punong Barangay for further
417 shall have already elapsed. The complainant can no longer enforce the settlement proceedings. However, the Court may resolve the issues posed by the petitioners, based
through the Lupon, but had to enforce the same through an action in the MTC, in on the pleadings of the parties to serve the ends of justice. It is an accepted rule of

Page 99 of 100
procedure for the Court to strive to settle the existing controversy in a single proceeding, the petitioners, the disputed property is not covered by the aforementioned areas and
leaving no root or branch to bear the seeds of future litigation. 32 zones.39

In this case, there is no question that the petitioners were obliged under the settlement IN LIGHT OF ALL THE FOREGOING, the petition is DENIED. The petitioners and all those
to vacate the premises in January 2000. They refused, despite the extensions granted by acting for and in their behalf are directed to vacate, at their own expense, the property
the respondent, to allow their stay in the property. For the court to remand the case to covered by Transfer Certificate of Title No. 15324 of the Register of Deeds of Muntinlupa
the Lupon and require the respondent to refile her motion for execution with the Lupon City and deliver possession of the property to the vendees Mary Liza Santos, Susana Lim
would be an idle ceremony. It would only unduly prolong the petitioners’ unlawful and Johnny Lim. This is without prejudice to the right of the vendees to recover from the
retention of the premises.33 petitioners reasonable compensation for their possession of the property from January
2000 until such time that they vacate the property. Costs against the petitioners.
The RTC and the CA correctly ruled that the respondent is the real party-in-interest to
enforce amicable settlement. Rule 3, Section 2 of the Rules of Court, as amended, reads: SO ORDERED.

SEC. 2. Parties in interest. - A real party in interest is the party who stands to be Davide, Jr., C.J., Puno, Vitug, Panganiban, Quisumbing, Ynares-Santiago, Sandoval-
benefited or injured by the judgment in the suit, or the party entitled to the avails of the Gutierrez, Carpio, Austria-Martinez, Corona, Carpio-Morales, Azcuna, and Tinga, JJ.,
suit. Unless otherwise authorized by law or these Rules, every action must be prosecuted concur.
or defended in the name of the real party in interest.

The party-in-interest applies not only to the plaintiff but also to the
defendant.1âwphi1 "Interest" within the meaning of the rules means material interest, an
interest in issue and to be affected by the decree as distinguished from mere interest in
the question involved, or a mere incidental interest. 34 A real party in interest is one who
has a legal right.35 Since a contract may be violated only by the parties thereto as against
each other, in an action upon that contract, the real parties-in-interest, either as plaintiff
or as defendant, must be parties to the said contract. 36 The action must be brought by the
person who, by substantive law, possesses the right sought to be enforced. 37 In this case,
the respondent was the party in the amicable settlement. She is the real party-in-interest
to enforce the terms of the settlement because unless the petitioners vacate the property,
the respondent and the other vendors should not be paid the balance of P1,000,000.00 of
the purchase price of the property under the Deed of Conditional Sale.

The petitioners are estopped from assailing the amicable settlement on the ground of
deceit and fraud. First. The petitioners failed to repudiate the settlement within the period
therefor. Second. The petitioners were benefited by the amicable settlement. They were
allowed to remain in the property without any rentals therefor until December 1998. They
were even granted extensions to continue in possession of the property. It was only when
the respondent filed the motion for execution that the petitioners alleged for the first time
that the respondents deceived them into executing the amicable settlement. 38

On the petitioners’ claim that they were entitled to the right of first refusal under P.D. No.
1517, we agree with the disquisition of the trial court, as quoted by the Court of Appeals:

We likewise find no reversible error on the part of [the] RTC in rejecting that the
petitioners have a right of first refusal in the purchase and sale of the subject property.
As ratiocinated by the court:

"xxx. Presidential Decree No. 1517 (The Urban Land Reform Law) does not apply where
there is no showing that the land leased has been proclaimed to be within a specific
Urban Land Reform Zone. In the instant case, the annex attached to the Proclamation
1967 creating the areas declared as priority development and urban land reform zone ...
does not indicate that the barangay where the subject property is located is included
therein. This is bolstered by the certification issued by the Housing and Land Regulatory
Board to the effect that the location of the property is outside the area of Priority
Development. It is therefore a reversible error for the lower court to conclude that
defendants-appellees were deprived of their preemptive right when no right exists in the
first place."

Indeed, before a preemptive right under PD 1517 can be exercised, the disputed land
should be situated in an area declared to be both an APD (Areas for Priority Development)
and a ULRZ (Urban Land Reform Zones).1âwphi1 Records show, and as not disputed by

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