Civpro cases Batch 1

SECOND DIVISION

[G.R. No. L-34840. July 20, 1982.]

MARIO RODIS MAGASPI, JUSTINO R. MAGASPI, BALDOMERA M. ALEJANDRO, and MANOLITA M. CORTEZ, Petitioners, v. HONORABLE JOSE R. RAMOLETE, Judge of the Court of First Instance of Cebu, ESPERANZA V. GARCIA, Clerk of Court of First Instance of Cebu, THE SHELL COMPANY OF THE PHILIPPINES LIMITED and/or THE SHELL REFINING COMPANY (Phil.) INC., CENTRAL VISAYAN REALTY & INVESTMENTS CO., INC., CEBU CITY SAVINGS & LOAN ASSOCIATION and the GOVERNMENT OF THE REPUBLIC OF THE PHILIPPINES, Respondents.

SYNOPSIS

Petitioners paid only P60.00 as docketing fee when they filed a complaint for the recovery of ownership and possession of a parcel of land with damages (Civil Case No. R-11882) against herein private respondents, prompting the latter to file a motion to compel them to pay the correct filing fee of 16,730.00, based on the total demand of the former, but the Court ordered the payment of the amount of P3,164.00 plus P2.00 Legal Research fee as fixed by the Clerk of Court. Thereafter, an amended complaint was filed by the petitioners, so as to include the government as a defendant but the complaint still sought the return of the lot in question, limiting however the pecuniary claim. The admission of the amended complaint by Judge Canonoy without petitioners’ payment of the required additional amount was opposed by the private respondents on the ground that the amended complaint which had been admitted had replaced the original complaint. Respondent Judge Jose R. Ramolete, who had replaced Judge Canonoy, resolved private respondent’s motion by giving the plaintiffs-petitioners the choice to pay the docket fee assessed or to forego the proceeding, but said order was assailed by the latter, insisting that they correctly paid the correct amount of P8.00, or in the alternative, that if they are to pay an additional docketing fee, it should be based on the amended complaint.

The Supreme Court held that the trial court had acquired jurisdiction over Civil Case No. R-11882 which was docketed upon the payment of P60.00 although said amount is insufficient and that the additional docket fee to be paid by the petitioners should be based on their amended complaint for the original pleading is deemed abandoned.

Petition granted.SYLLABUS

1. REMEDIAL LAW; ACTIONS, FILING OF; PAYMENT OF DOCKET FEES, SETTLED RULE. — The rule is well-settled that a case is deemed filed only upon payment of the docket fee regardless of the actual date of its filing in court. (Malimit v. Degamo, No. L-17850, Nov. 28, 1964, 12 SCRA 450, 120 Phil. 1247; Lee v. Republic, L-15027, Jan. 31, 1964, 10 SCRA 65.)

2. ID.; ID.; ID.; NOT APPLICABLE WHERE CONTROVERSY REFERS TO AMOUNT OF DOCKET FEE TO BE PAID. — The rule settled in the Malimit and Lee cases concerned the timeliness of the payment of the docket fee. It does not cover the case at bar where there is no reference to the time of payment but concerns the amount that has to be paid.

3. ID.; ID.; JURISDICTION ACQUIRED BY COURT DESPITE PAYMENT OF INSUFFICIENT DOCKET FEE. — Civil Case No. R-11882 was docketed upon the payment of P60.00 although said amount is insufficient. Accordingly, the trial court had acquired jurisdiction over the case and the proceedings thereafter had were proper and regular.

4. ID.; ID.; ID.; DOCKET FEES TO BE ASSESSED ON THE BASIS OF THE AMENDED COMPLAINT. — Petitioners’ assertion that the docket fee be based on the amended complaint which was admitted on November 14, 1970, is in point. "When a pleading is amended, the original pleading is deemed abandoned. The original ceases to perform any further function as a pleading. The case stands for trial on the amended pleading only." (1 Moran, Rules of Court, 363 (1970), citing Reynes v. Compania General de Tobacos de Filipinas, 21 Phil. 417; Reyman v. Director of Lands, 34 Phil. 428.) On the basis of the foregoing, the additional docket fee to be paid should be based on petitioners’ amended complaint.

D E C I S I O N

ABAD SANTOS, J.:

This is a petition for certiorari to review the actuations of the Court of First Instance of Cebu in Civil Case No. R-11882 in

respect of the correct amount to be paid for the filing of the case as provided in Sec. 5, par. (a), Rule 141 of the Rules of Court.

On September 16, 1970, the petitioners filed a complaint for the recovery of ownership and possession of a parcel of land with damages against The Shell Co. of the Philippines, Ltd and/or The Shell Refining Co. (Phil.) Inc., Central Visayan Realty & Investment Co., Inc. and Cebu City Savings & Loan Association in the Court of First Instance of Cebu. Upon filing and the payment of P60.00 as docketing fee and P10.00 for sheriff fees, the complaint was assigned Civil Case No. R-11882.chanrobles.com:cralaw:red

The complaint contains, among other prayers, the following:jgc:chanrobles.com.ph

"3. To declare Transfer Certificate of Title No. 41215 issued in the name of the defendant Central Visayan Realty & Investment Co., Inc. as null and void and hence of no legal effect;

"4. That the herein plaintiffs in their capacity as heirs of the deceased spouses Crispulo Magaspi and Rosalia Rodis be declared as owners of the land in question;

"5. That once declared as null and void, The Register of Deeds for the City and Province of Cebu be ordered to cancel the abovementioned Transfer Certificate of Title and issue another in their place in the name of the herein plaintiffs;

"6. To order the defendants, The Shell Company of the Philippines Limited, formerly known as The Asiatic Petroleum Co. (P.I.), Ltd., and/or The Shell Refining Company (Phil), Inc., to pay the plaintiffs the amount of P3,500.00 a month representing unpaid monthly rentals starting from June 2, 1948 up to May 15, 1968, and to order all the defendants jointly and solidarily to pay the plaintiffs the amount of P3,500.00 a month representing unpaid monthly rentals starting from May 16, 1968 up to the date that the land is actually delivered to the herein plaintiffs;

"7. To order the defendants jointly and solidarily to return the ownership and possession of the lot in question to the herein plaintiffs;

"8. To order the defendants jointly and solidarily to pay the plaintiffs the amount of P500,000.00 as moral damages and attorney’s fees in the amount of P250,000.00 and the cost of this action;

"9. Exemplary damages be imposed on the defendants jointly and solidarily in the amount of P500,000.00 as an example and deterrent to any similar acts in the future."cralaw virtua1aw library

On September 18, 1970, Central Visayan Realty & Investment Co., Inc. and Cebu City Savings and Loan Assn. filed a motion to compel the plaintiffs to pay the correct amount for docket fee. The motion, omitting the confusing footnotes, reads:chanrobles virtual lawlibrary

"1. That the complaint of the plaintiffs contains or states two, if not three alternative causes of action:chanrob1es virtual 1aw library

a) Reconveyance of real property. —

Par. 4. — ‘That the herein plaintiffs in their capacity as heirs of the deceased spouses Crispulo Magaspi and Rosalia Rodis be declared as owners of the land in question;

Par. 5. — That once declared null and void, the Register of Deeds for the City and Province of Cebu are ordered to cancel the above-mentioned Transfer Certificate of Title and issue another in their place in the names of the herein plaintiffs.

"If the plaintiffs are unable to have the property reconveyed and the title canceled, having passed to an innocent purchaser for value, their recourse would be for damages, i.e., recovery of the value of the land and other damages.

b) Recovery of the value of the land and Damages. —

1. To order the defendants, to pay plaintiffs the amount of P3, 500.00 a month representing unpaid monthly rentals starting from June 2, 1948 up to May 15, 1968, and to order all the defendants jointly and severally to pay the plaintiffs the amount of P3,500.00 a month starting from May 16, 1968 up to the date that the land is actually delivered to herein plaintiffs;

2. To order the defendants jointly and solidarily to pay the plaintiffs the amount of P500,000.00 as moral damages and attorney’s fees in the amount of P250,000.00;

3. Exemplary damages be imposed on the defendants jointly and severally in the amount of P500,000.00;

4. That because of the unlawful occupation and usurpation the plaintiffs suffered damages in the amount of P1,250,000.00 which is the reasonable market value of the land in question it being a first class commercial land.

c) Cancellation of Titles. —

1. To declare Transfer Certificate of Title No. 41215 null and void;

2. That each of these alternative causes of action is distinct and separate from each other. Each may be instituted by plaintiffs against the defendants and the same may constitute a valid cause of action. Each constitutes an appropriate basis therefore, for determining the correct amount of the docket fee in this case;

3. That in the suit for reconveyance, the recovery of the improvements existing on the land is deemed included, since defendant Cebu City Savings is alleged to be a builder in bad faith. The value of existing improvement, i.e., assessed value is P70,000.00;

4. Therefore, the docket fee should be:chanrob1es virtual 1aw library

Docket fee

Land and Improvement at P87,280.00 assessed value P100.00

Recovery of Value of the Land and damages:chanrob1es virtual 1aw library

a) P1,250,000.00 — Land value

b) 500,000.00 — Moral Damages

c) 500,000.00 — Exemplary Damages

d) 250,000.00 — Attorney’s fees

e) 890,633.24 — Monthly rentals up to date of filing of complaint 6,632.00

————

P3,390,633.24.

(Six Thousand Seven Hundred Thirty Two Pesos) 6,732.00

5. That under the Old Rules of Court, Sec. 5, Rule 130 provides that it is the sum claimed, ‘exclusive of interest and damages;’ while under the new Rules of Court, Sec. 5, Rule 141, it is the sum claimed, ‘exclusive of interest,’ the word ‘damages’ having been excluded purposely, indicating the intent to include damages in the computation of the docket fee;

"WHEREFORE, it is respectfully prayed that the plaintiffs be made to pay the correct docket fee within the time prescribed by this Honorable Court, as properly computed by the Clerk of Court and failing to pay the same within the prescribed period to dismiss the case.

"Further, until such time as the correct docket fee is paid, the time for filing of responsive pleadings by the defendants be suspended."cralaw virtua1aw library

The motion was opposed by the plaintiffs (petitioners herein) who claimed that the main cause of action was the recovery of a piece of land and on the basis of its assessed valued, P60.00 was the correct docketing fee and that although the Revised Rules of Court do not exclude damages in the computation of the docket fee, damages are nonetheless still to be excluded.

On October 5, 1970, the presiding judge ordered the Clerk of Court to comment on the motion and the opposition. The following comment was submitted:chanrobles law library

"1. That in the matter of fixing the amount of fees that shall be collected by the Clerks of Court of First Instance for the filing of an action or proceeding, Section 5, Rule 141 of the Rules of Court provides as follows:chanrob1es virtual 1aw library

Sec. 5. Clerks of Court of First Instance. — (a) For filing an action or proceeding, or a permissive counterclaim or cross-claim not arising out of the same transaction subject of the complaint, a third-party complaint and a complaint in intervention and for all services in the same, if the sum claimed, exclusive of interest, or the value of the property in litigation, or the value of the estate, is:chanrob1es virtual 1aw library

1. Less than P200.00 P16.00

2. P200.00 or more but less than P600.00 24.00

3. P600.00 or more but less than P3,000.00 32.00

4. P3,000.00 or more but less than P5,000.00 40.00



7. P50,000.00 or more but less than P100,000.00 100


9. And for each P1,000.00 in excess of P150,000.00 2.00

10. When the value of the case cannot be estimated 200.00

11. When the case does not concern property (naturalization, adoption, legal separation, etc.) 32.00

12. In forcible entry and illegal detainer cases appealed from inferior cases 20.00

If the case concerns real estate, the assessed value thereof shall be considered in computing the fees. (Italics supplied)

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

"2. That a reading of the complaint in this case would show that the action is not only for recovery of property but also for actual and moral damages as well as for attorney’s fees;

"3. That under the provisions of Sec. 5, Rule 141 of the Rules of Court, already cited above, it appears that for the purpose of determining the amount of the fees that should be collected for the filing of an action or proceeding, the basis should be the totality of the sum or sums claimed, exclusive of interest, except in the case of real estate where the assessed value thereof shall be considered in computing the fees;

"4. That in the light of the foregoing, it is the opinion of the undersigned that the basis for computing the fees for the filing of the complaint in this case should be as follows:chanrob1es virtual 1aw library

(a) Assessed value of the land

(please see par. 4 of the complaint) P17,280.00

(b) Moral damages 500,000.00

(c) Attorney’s fees 250,000.00

(d) Monthly rentals at P3,500.00 a month up to the filing of complaint 890,633.24

TOTAL — P1,657,913.24

"Accordingly, the correct amount of the legal fees for the filing of this case should be fixed at P3,164.00 plus P2.00 Legal Research fee;"

On October 14, 1970, Judge Mateo Canonoy issued the following order:jgc:chanrobles.com.ph

"This is a motion of the defendants to order the plaintiffs to pay a filing fee of P6,730.00 on the ground that the total demand of the said plaintiffs (the value of the land, which is P17,280.00, plus the damages amounting to P3,390,633.24) should be the basis for computing the filing fee and not the value of the land alone. The plaintiffs paid the amount of P60.00 as filing fee in this case.

"Examining the allegations of the complaint, the Court is constrained to sustain the Manifestation or contention of the Clerk of Court, dated October 14, 1970. The damages are not merely incidental or ancillary but are principal demands. Besides, Rule 141, Sec. 5 (a) of the new Rules of Court no longer excludes damages, like interest, from computing the filing fees. (The Old Rules of Court, Rule 130, Sec. 5 (a), expressly includes damages and interest in the exemption.) The exclusion of damages from the exemption in the computation of the filing fees in the new Rules of Court is intentional, since oftentimes, as in the present case, the claim for damages far exceeds the value of the land. To thus exempt the plaintiffs from paying the filing fee for damages is against reason. Besides, in determining the jurisdiction of the court, the amount of damages claimed is taken into account.

"The opinion of Undersecretary Guillermo Santos that the Court ought to be left alone to determine the question of the filing fee of cases pending therein without any interference from the Secretary of Justice (Attorney General) is commendable.

"IN VIEW OF THE FOREGOING, the Court hereby overrules the opposition of the plaintiffs and orders them to pay an additional sum of P3,104.00 as filing fees."cralaw virtua1aw library

On October 19, 1970, the Shell companies filed their respective answers.

On October 23, 1970, Central Visayan Realty and Cebu City Savings filed the following manifestation:cralawnad

"1. That this Honorable Court issued an Order, dated October 14th, 1970 for the plaintiffs to pay an additional P3,104.00 docket fee, per computation and manifestation of the Clerk of Court;

"2. That the Clerk of Court manifestations is predicated on the following:chanrob1es virtual 1aw library

Land Value P17,280.00 P60.00

Damages:chanrob1es virtual 1aw library

a) Moral Damages P500,000.00

b) Attorney’s fees 250,000.00

c) Monthly Rental 890,633.24

——————

P1,640,633.24

and excusably excluded was the exemplary damages sought (Par. 22 Complaint, Par. 9, Prayer) in the amount of Five Hundred Thousand Pesos (P500,000.00);

"WHEREFORE, it is respectfully prayed that in the computation of the correct docket fee, besides the sum of P3,104.00, an additional sum of P1,000.00 be imposed in accordance with Sec. 5 (Par. 9) Rule 141 of the Rules of Court: and should the plaintiffs within a period fixed by this Honorable Court fail to pay the same, the complaint be dismissed with prejudice, and for such other reliefs as this Honorable Court may deem just under the premises."cralaw virtua1aw library

On November 3, 1970, the plaintiffs filed a motion for leave to amend the complaint so as to include the Government of the Republic of the Philippines as a defendant. The amended complaint still sought the return of the lot in question but the pecuniary claim was limited to the following:chanrobles law library : red

"8. To order the defendants jointly and solidarily except the Government of the Republic of the Philippines moral damages in such amount as this Court may determine and attorney’s fees in the amount of P100,000.00 and the cost of this action;

"9. Exemplary damages be imposed on the defendants jointly and solidarily except the Government of the Republic of the Philippines in the amount as this Court may deem just and proper as an example and deterrent to any similar acts in the future." (Italics not supplied.)

On November 12, 1970, the defendants (herein respondents) filed an opposition to the admission of the amended complaint. They based their opposition on the following grounds:jgc:chanrobles.com.ph

"1. That while the only reason given for the amendment of the complaint is the inclusion of the Government of the Philippines as an indispensable party; the plaintiffs have taken the improper liberty of amending portions of the allegations in the complaint and even has eliminated entire paragraph, thus:chanrob1es virtual 1aw library

a) By not mentioning the previously alleged value of the land at P1,250,000.00 in paragraph 19;

b) By not mentioning the previously averred to monthly rentals due at P3,500.00 from June 2, 1948, or computed at P890,633.24;

c) By eliminating completely the claim for moral damages of P500,000.00 and reducing attorney’s fees from P250,000.00 to P100,000.00 under par. 21;

d) By not mentioning the amount previously claimed as exemplary damages in the sum of P500,000.00, as alleged in par. 21;

substituting thereto, the averment that, the amount of these various claims for damages will be proven during the trial of the case;

"2. That these amendments are obviously intended to circumvent, if not entirely subvert, the lawful Order of this Honorable Court for the plaintiff to pay the amount of P3,104.00 as docket fee, on the basis of the total amount claimed for damages (plus P1,000.00 docket fee on the P500,000.00 exemplary damages, pending resolution before this Honorable Court);

"3. That if the amended complaint is admitted as it is, plaintiffs would effect, have their cakes and eat it too, in the manner of speaking;

"4. That the payment of the correct and in this case, by an Order of this Honorable Court of the docket fee, is a condition precedent for the complaint, amended or otherwise, of the plaintiff to be given due course;"

On November 16, 1970, Judge Canonoy admitted the amended complaint although the plaintiffs had not yet complied with his Order of October 14, 1970, that they should pay an additional P3,104.00 docket fee.

On December 2, 1970, Central Visayan Realty and Cebu City Savings filed the following motion:jgc:chanrobles.com.ph

"1. That this Honorable Court issued an Order dated October 14, 1970, for the plaintiffs to pay an additional docket fee of P3,104.00;

"2. That such an Order has not been complied with by the plaintiffs nor an appeal or a petition for review filed and the same has become final;

"3. That Sec. 3 Rule 17 of the Rules of Court provides that if plaintiff fails:chanrob1es virtual 1aw library

‘to comply with these rules of any order of the court, the action may be dismissed upon motion of the defendant, or upon the court’s own motion.’

"4. That the filing of the answer by these defendants is premised on the payment of the correct or as ordered docket fee by the plaintiffs; for which reason, no answer has yet been filed;

"WHEREFORE, it is respectfully prayed that the plaintiffs be ordered to pay the additional docket fee within seven (7) days, otherwise the complaint will be dismissed with prejudice."cralaw virtua1aw library

The above motion was opposed by the plaintiffs on the ground that the amended complaint which had been admitted by the court had replaced the original complaint.

On February 12, 1971, the Republic filed its answer to the amended complaint and the plaintiffs filed a reply on February 23, 1971.

On March 13, 1971, Central Visayan Realty and Cebu City Savings filed a petition to have their motion of December 2, 1970, resolved by the court.chanrobles virtual lawlibrary

On April 3, 1971, Judge Jose R. Ramolete who had replaced Judge Canonoy issued the following order:jgc:chanrobles.com.ph

"This is a petition of the defendants praying for the resolution of their motion dated December 3, 1970. This motion was brought about by virtue of the order of this Court dated October 14, 1970, ordering the plaintiffs to pay additional docket fees of P3,104.00.

"Going over the record of the case, it appears that after the issuance of the above order, the plaintiffs filed their amended complaint which was also admitted on November 16, 1970.

"At the hearing of this petition the parties supported their respective positions with oral arguments after which they submitted the matter for resolution.

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

"In the light of the above rulings on the matter, the original complaint, up to the present, is not deemed registered or docketed. It follows, therefore, that there is likewise no amended complaint deemed to have been filed and admitted.

"The Court, therefore, is of the view that up to the present the parties are in the same situation as they were before this

proceeding was started. It cannot also order the plaintiffs to comply with the order of this Court dated October 14, 1970, because it has not yet acquired jurisdiction over them neither can it order the dismissal of the complaint for non-compliance of the order of October 14, 1970, by the plaintiffs, for obvious reasons. The plaintiffs are given the choice to pay the docket fee assessed or to forego this proceeding."cralaw virtua1aw library

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

For initial determination is the question as to whether or not Civil Case No. 11882 may be considered as having been filed and docketed when P60.00 was paid to the Clerk of Court even on the assumption that said payment was not sufficient in amount.

The rule is well-settled that a case is deemed filed only upon payment of the docket fee regardless of the actual date of its filing in court. (Malimit v. Degamo, No. L-17850, Nov. 28, 1964, 12 SCRA 450, 120 Phil. 1247; Lee v. Republic, L-15027, Jan. 31, 1964, 10 SCRA 65.)

Is the case at bar covered by the above rule? It is not because the question posed in the Malimit and Lee cases was the timeliness of the payment of the docket fee whereas the case at bar has no reference to the time of payment but concerns the amount that has to be paid.

The case of Garcia v. Vasquez, L-26808, May 23, 1969, 28 SCRA 330, mentioned in the order of Judge Ramolete will be discussed below. And as to Lazaro v. Endencia, 37 Phil. 552 (1932), it does not appear to have relevance to the question. In that case an appeal in an ejectment case was made and the appellant deposited only P8.00 as docket fee instead of P16.00 as required by law. It was only after the period for perfecting an appeal that the appellant deposited the additional P8.00 to complete the amount of said docket fee. This Court dismissed the appeal on the ground "that payment of the full amount of the docket fees is an indispensable step for the perfection of an appeal." (At p. 553.)

The case at bar can be distinguished from the Lazaro case in at least two respects, namely: (a) The Lazaro case involved the timeliness of the perfection of the appeal which was made to depend in turn on the timeliness of the full payment of the docket fee whereas the instant case does not involve an appeal nor the timeliness of the payment of the docket fee; and (b) in the Lazaro case, the amount (P8.00) which was initially paid was palpably inadequate, whereas in the case at bar there is an honest difference of opinion as to the correct amount to be paid as docket fee.

The Garcia case, supra, appears to favor the petitioners. In that case, a will was sought to be probated in Special Proceeding No. 62818. Docket fees amounting to P940.00 were paid. Later, a second will was sought to be probated in the same special proceeding. This Court held that there was no need to pay a separate docket fee because the probate of the second will was not sought in another proceeding.

We hold that under the circumstances, Civil Case No. R-11882 was docketed upon the payment of P60.00 although said amount is insufficient. Accordingly, the trial court had acquired jurisdiction over the case and the proceedings thereafter had were proper and regular.cralawnad

The next question is in respect of the correct amount to be paid as docket fee. Judge Canonoy on October 14, 1970, ordered the payment of P3,104.00 as additional docket fee based on the original complaint. However, the petitioners assert as an alternative view, that the docket fee be based on the amended complaint which was admitted on November 14, 1970, also by Judge Canonoy.

The petitioners have a point. "When a pleading is amended, the original pleading is deemed abandoned. The original ceases to perform any further function as a pleading. The case stands for trial on the amended pleading only." (1 Moran, Rules of Court, 363 [1970], citing Reynes v. Compañia General de Tobacos de Filipinas, 21 Phil. 417; Reyman v. Director of Lands, 34 Phil. 428.)

On the basis of the foregoing, the additional docket fee to be paid by the petitioners should be based on their amended complaint.

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

SO ORDERED.

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

Escolin, J., concurs in the result.

EN BANC

[G.R. No. 75919. May 7, 1987.]

MANCHESTER DEVELOPMENT CORPORATION, ET AL., Petitioners, v. COURT OF APPEALS, CITYLAND

DEVELOPMENT CORPORATION, STEPHEN ROXAS, ANDREW LUISON, GRACE LUISON and JOSE DE

MAISIP, Respondents.

Tanjuatco, Oreta and Tanjuatco, for Petitioners.

Pecabar Law Offices for Private Respondents.

SYLLABUS

1. REMEDIAL LAW; CIVIL PROCEDURE; NON-PAYMENT OF DOCKET FEE; RENDERS NULL AND VOID AND COMPLAINTS AND SUBSEQUENT PROCEEDINGS WHERETO. — The rule is well-settled "that a case is deemed filed only upon payment of the docket fee regardless of the actual date of filing in court." Thus, in the present case the trial court did not acquire jurisdiction over the case by the payment of only P410.00 as docket fee. Neither can the amendment of the complaint thereby vest jurisdiction upon the Court. For all legal purposes there is no such original complaint that was duly filed which could be amended. Consequently, the order admitting the amended complaint and all subsequent proceedings and actions taken by the trial court are null and void. The Court acquires jurisdiction over any case only upon payment of the prescribed docket fee. An amendment of the complaint or similar pleading will not thereby vest jurisdiction in the Court, much less the payment of the docket fee based on the amounts sought in the amended pleading.chanroblesvirtuallawlibrary

2. ID.; ID.; COMPLAINT; CONTENTS; AMOUNT OF MANDAMUS MUST BE SPECIFIED NOT ONLY IN THE BODY BUT ALSO IN THE PRAYER. — All complaints, petitions, answers and other similar pleadings should specify the amount of damages being prayed for not only in the body of the pleading but also in the prayer, and said damages shall be considered in the assessment of the filing fees in any case. Any pleading that fails to comply with this requirement shall not be accepted nor admitted, or shall otherwise be expunged from the record. The court acquires jurisdiction over any upon payment of the prescribed docket fee.

R E S O L U T I O NGANCAYCO, J.:

Acting on the motion for reconsideration of the resolution of the Second Division of January 28, 1987 and another motion to refer the case to and to be heard in oral argument by the Court En Banc filed by petitioners, the motion to refer the case to the Court en banc is granted but the motion to set the case for oral argument is denied.

Petitioners in support of their contention that the filing fee must be assessed on the basis of the amended complaint cite the case of Magaspi v. Ramolete. 1 They contend that the Court of Appeals erred in ruling that the filing fee should be levied by considering the amount of damages sought in the original complaint.

The environmental facts of said case differ from the present in that —

1. The Magaspi case was an action for recovery of ownership and possession of a parcel of land with damages, 2 while the present case is an action for torts and damages and specific performance with prayer for temporary restraining order, etc. 3

2. In the Magaspi case, the prayer in the complaint seeks not only the annulment of title of the defendant to the property, the declaration of ownership and delivery of possession thereof to plaintiffs but also asks for the payment of actual, moral, exemplary damages and attorney’s fees arising therefrom in the amounts specified therein. 4 However, in the present case, the prayer is for the issuance of a writ of preliminary prohibitory injunction during the pendency of the action against the defendants’ announced forfeiture of the sum of P3 Million paid by the plaintiffs for the property in question, to attach such property of defendants that maybe sufficient to satisfy any judgment that maybe rendered, and after hearing, to order defendants to execute a contract of purchase and sale of the subject property and annul defendants’ illegal forfeiture of the money of plaintiff, ordering defendants jointly and severally to pay plaintiff actual, compensatory and exemplary damages as well as 25% of said

amounts as maybe proved during the trial as attorney’s fees and declaring the tender of payment of the purchase price of plaintiff valid and producing the effect of payment and to make the injunction permanent. The amount of damages sought is not specified in the prayer although the body of the complaint alleges the total amount of over P78 Million as damages suffered by plaintiff. 5

3. Upon the filing of the complaint there was an honest difference of opinion as to the nature of the action in the Magaspi case. The complaint was considered as primarily an action for recovery of ownership and possession of a parcel of land. The damages stated were treated as merely ancillary to the main cause of action. Thus, the docket fee of only P60.00 and P10.00 for the sheriff’s fee were paid. 6

In the present case there can be no such honest difference of opinion. As maybe gleaned from the allegations of the complaint as well as the designation thereof, it is both an action for damages and specific performance. The docket fee paid upon filing of complaint in the amount only of P410.00 by considering the action to be merely one for specific performance where the amount involved is not capable of pecuniary estimation is obviously erroneous. Although the total amount of damages sought is not stated in the prayer of the complaint yet it is spelled out in the body of the complaint totalling in the amount of P78,750,000.00 which should be the basis of assessment of the filing fee.chanrobles.com : virtual law library

4. When this under-assessment of the filing fee in this case was brought to the attention of this Court together with similar other cases an investigation was immediately ordered by the Court. Meanwhile plaintiff through another counsel with leave of court filed an amended complaint on September 12, 1985 for the inclusion of Philips Wire and Cable Corporation as co-plaintiff and by eliminating any mention of the amount of damages in the body of the complaint. The prayer in the original complaint was maintained. After this Court issued an order on October 15, 1985 ordering the re-assessment of the docket fee in the present case and other cases that were investigated, on November 12, 1985 the trial court directed plaintiffs to rectify the amended complaint by stating the amounts which they are asking for. It was only then that plaintiffs specified the amount of damages in the body of the complaint in the reduced amount of P10,000,000.00. 7 Still no amount of damages were specified in the prayer. Said amended complaint was admitted.

On the other hand, in the Magaspi case, the trial court ordered the plaintiffs to pay the amount of P3,104.00 as filing fee covering the damages alleged in the original complaint as it did not consider the damages to be merely ancillary or incidental to the action for recovery of ownership and possession of real property. 8 An amended complaint was filed by plaintiff with leave of court to include the government of the Republic as defendant and reducing the amount of damages, and attorney’s fees prayed for to P100,000.00. Said amended complaint was also admitted. 9

In the Magaspi case, the action was considered not only one for recovery of ownership but also for damages, so that the filing fee for the damages should be the basis of assessment. Although the payment of the docketing fee of P60.00 was found to be insufficient, nevertheless, it was held that since the payment was the result of an "honest difference of opinion as to the correct amount to be paid as docket fee" the court "had acquired jurisdiction over the case and the proceedings thereafter had were proper and regular." 10 Hence, as the amended complaint superseded the original complaint, the allegations of damages in the amended complaint should be the basis of the computation of the filing fee. 11

In the present case no such honest difference of opinion was possible as the allegations of the complaint, the designation and the prayer show clearly that it is an action for damages and specific performance. The docketing fee should be assessed by considering the amount of damages as alleged in the original complaint.chanroblesvirtual|awlibrary

As reiterated in the Magaspi case the rule is well-settled "that a case is deemed filed only upon payment of the docket fee regardless of the actual date of filing in court." 12 Thus, in the present case the trial court did not acquire jurisdiction over the case by the payment of only P410.00 as docket fee. Neither can the amendment of the complaint thereby vest jurisdiction upon the Court. 13 For all legal purposes there is no such original complaint that was duly filed which could be amended. Consequently, the order admitting the amended complaint and all subsequent proceedings and actions taken by the trial court are null and void.

The Court of Appeals therefore, aptly ruled in the present case that the basis of assessment of the docket fee should be the amount of damages sought in the original complaint and not in the amended complaint.

The Court cannot close this case without making the observation that it frowns at the practice of counsel who filed the original complaint in this case of omitting any specification of the amount of damages in the prayer although the amount of over P78 million is alleged in the body of the complaint. This is clearly intended for no other purpose than to evade the payment of the correct filing fees if not to mislead the docket clerk in the assessment of the filing fee. This fraudulent practice was compounded when, even as this Court had taken cognizance of the anomaly and ordered an investigation, petitioner through another counsel filed an amended complaint, deleting all mention of the amount of damages being asked for in the body of the complaint. It was only when in obedience to the order of this Court of October 18, 1985, the trial court directed that the amount of damages be specified in the amended complaint, that petitioners’ counsel wrote the damages sought in the much reduced amount of P10,000,000.00 in the body of the complaint but not in the prayer thereof. The design to avoid payment of the required docket fee is obvious.

The Court serves warning that it will take drastic action upon a repetition of this unethical practice.chanrobles virtual lawlibrary

To put a stop to this irregularity, henceforth all complaints, petitions, answers and other similar pleadings should specify the amount of damages being prayed for not only in the body of the pleading but also in the prayer, and said damages shall be considered in the assessment of the filing fees in any case. Any pleading that fails to comply with this requirement shall not be accepted nor admitted, or shall otherwise be expunged from the record.

The Court acquires jurisdiction over any case only upon the payment of the prescribed docket fee. An amendment of the complaint or similar pleading will not thereby vest jurisdiction in the Court, much less the payment of the docket fee based on the amounts sought in the amended pleading. The ruling in the Magaspi case 14 in so far as it is inconsistent with this pronouncement is overturned and reversed.

WHEREFORE, the motion for reconsideration is denied for lack of merit.

SO ORDERED.

Teehankee, C.J., Yap, Fernan, Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Feliciano, Bidin, Sarmiento and Cortes, JJ., concur.

Paras, J., took no part.

EN BANC

[G.R. Nos. 79937-38. February 13, 1989.]

SUN INSURANCE OFFICE, LTD., (SIOL), E.B. PHILIPPS AND D.J. WARBY, Petitioners, v. HON. MAXIMIANO C.

ASUNCION, Presiding Judge, Branch 104, Regional Trial Court, Quezon City and MANUEL CHUA UY PO

TIONG, Respondents.

Romulo, Mabanta, Buenaventura, Sayoc & De los Angeles Law Offices, for Petitioners.

Tanjuatco, Oreta, Tanjuatco, Berenguer & Sanvicente Law Offices for Private Respondent.

SYLLABUS

1. STATUTES; PROCEDURAL LAWS; APPLIED RETROSPECTIVELY. — Private respondent claims that the ruling in Manchester (149 SCRA 562) cannot apply retroactively to Civil Case No. Q-41177 for at the time said civil case was filed in court there was no such Manchester ruling as yet. Further, private respondent avers that what is applicable is the ruling of this Court in Magaspi v. Ramolete, wherein this Court held that the trial court acquired jurisdiction over the case even if the docket fee paid was insufficient. The contention that Manchester cannot apply retroactively to this case is untenable. Statutes regulating the procedure of the courts will be construed as applicable to actions pending and undetermined at the time of their passage. Procedural laws are

2. retrospective in that sense and to that extent.

2. REMEDIAL LAW; JURISDICTION; VESTS IN COURTS UPON PAYMENT OF THE PRESCRIBED DOCKET FEES. — It is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee, that vests a trial court with jurisdiction over the subject- matter or nature of the action. Where the filing of the initiatory pleading is not accompanied by payment of the docket fee, the court may allow payment of the fee within a reasonable time but in no case beyond the applicable prescriptive or reglementary period.

3. ID.; ID.; PERMISSIVE COUNTERCLAIMS AND THIRD-PARTY CLAIMS; NOT CONSIDERED FILED UNLESS PRESCRIBED DOCKET FEE IS PAID. — The same rule applies to permissive counterclaims, third-party claims and similar pleadings, which shall not be considered filed until and unless the filing fee prescribed therefor is paid. The court may also allow payment of said fee within a reasonable time but also in no case beyond its applicable prescriptive or reglementary period.

4. ID.; ID.; PAYMENT OF ADDITIONAL FEE REQUIRED WHERE JUDGMENT AWARDS CLAIM NOT SPECIFIED IN THE PLEADING. — Where the trial court acquires jurisdiction over a claim by the filing of the appropriate pleading and payment of the prescribed filing fee but, subsequently, the judgment awards a claim not specified in the pleading, or if specified the same has been left for determination by the court, the additional filing fee therefor shall constitute a lien on the judgment.

D E C I S I O NGANCAYCO, J.:

Again the Court is asked to resolve the issue of whether or not a court acquires jurisdiction over a case when the correct and proper docket fee has not been paid.

On February 28, 1984, petitioner Sun Insurance Office, Ltd. (SIOL for brevity) filed a complaint with the Regional Trial Court of Makati, Metro Manila for the consignation of a premium refund on a fire insurance policy with a prayer for the judicial declaration of its nullity against private respondent Manuel Uy Po Tiong. Private respondent was declared in default for failure to file the required answer within the reglementary period.chanroblesvirtuallawlibrary

On the other hand, on March 28, 1984, private respondent filed a complaint in the Regional Trial Court of Quezon City for the refund of premiums and the issuance of a writ of preliminary attachment which was docketed as Civil Case No. Q-41177, initially against petitioner SIOL, and thereafter including E.B. Philipps and D.J. Warby as additional defendants. The complaint sought, among others, the payment of actual, compensatory, moral, exemplary and liquidated damages, attorney’s fees, expenses of litigation and costs of the suit. Although the prayer in the complaint did not quantify the amount of damages sought said amount may be inferred from the body of the complaint to be about Fifty Million Pesos (P50,000,000.00).

Only the amount of P210.00 was paid by private respondent as docket fee which prompted petitioners’ counsel to raise his objection. Said objection was disregarded by respondent Judge Jose P. Castro who was then presiding over said case.

Upon the order of this Court, the records of said case together with twenty-two other cases assigned to different branches of the Regional Trial Court of Quezon City which were under investigation for under-assessment of docket fees were transmitted to this Court. The Court thereafter returned the said records to the trial court with the directive that they be re-raffled to the other judges in Quezon City, to the exclusion of Judge Castro. Civil Case No. Q-41177 was re-raffled to Branch 104, a sala which was then vacant.

On October 15, 1985, the Court en banc issued a Resolution in Administrative Case No. 85-10-8752-RTC directing the judges in said cases to reassess the docket fees and that in case of deficiency, to order its payment. The Resolution also requires all clerks of court to issue certificates of re-assessment of docket fees. All litigants were likewise required to specify in their pleadings the amount sought to be recovered in their complaints.

On December 16, 1985, Judge Antonio P. Solano, to whose sala Civil Case No. Q-41177 was temporarily assigned, issued an order to the Clerk of Court instructing him to issue a certificate of assessment of the docket fee paid by private respondent and, in case of deficiency, to include the same in said certificate.

On January 7, 1984, to forestall a default, a cautionary answer

was filed by petitioners. On August 30, 1984, an amended complaint was filed by private respondent including the two additional defendants aforestated.

Judge Maximiano C. Asuncion, to whom Civil Case No. Q- 41177 was thereafter assigned, after his assumption into office on January 16, 1986, issued a Supplemental Order requiring the parties in the case to comment on the Clerk of Court’s letter-report signifying her difficulty in complying with the Resolution of this Court of October 15, 1985 since the pleadings filed by private respondent did not indicate the exact amount sought to be recovered. On January 23, 1986, private respondent filed a "Compliance" and a "Re-Amended Complaint" stating therein a claim of "not less than P10,000,000.00 as actual compensatory damages" in the prayer. In the body of the said second amended complaint however, private respondent alleges actual and compensatory damages and attorney’s fees in the total amount of about P44,601,623.70.

On January 24, 1986, Judge Asuncion issued another Order admitting the second amended complaint and stating therein that the same constituted proper compliance with the Resolution of this Court and that a copy thereof should be furnished the Clerk of Court for the reassessment of the docket fees. The reassessment by the Clerk of Court bases on private respondent’s claim of "not less than P10,000,000.00 as actual and compensatory damages" amounted to P39,786.00 as docket fee. This was subsequently paid by private Respondent.

Petitioners then filed a petition for certiorari with the Court of Appeals questioning the said order of Judge Asuncion dated January 24, 1986.

On April 24, 1986, private respondent filed a supplemental complaint alleging an additional claim of P20,000,000.00 as damages so the total claim amounts to about P64,601,623.70. On October 16, 1986, or some seven months after filing the supplemental complaint, the private respondent paid the additional docket fee of P80,396.00. 1

On August 13, 1987, the Court of Appeals rendered a decision ruling, among others, as follows:jgc:chanrobles.com.ph

"WHEREFORE, judgment is hereby rendered:chanrob1es virtual 1aw library

1. Denying due course to the petition in CA-G.R. SP No. L-09715 insofar as it seeks annulment of the order.

(a) denying petitioners’ motion to dismiss the complaint, as amended, and

(b) granting the writ of preliminary attachment, but giving due course to the portion thereof questioning the reassessment of the docketing fee, and requiring the Honorable respondent Court to reassess the docketing fee to be paid by private respondent on the basis of the amount of P25,401,707.00." 2

Hence, the instant petition.

During the pendency of this petition and in conformity with the said judgment of respondent court, private respondent paid the additional docket fee of P62,432.90 on April 28, 1988. 3

The main thrust of the petition is that the Court of Appeals erred in not finding that the lower court did not acquire jurisdiction over Civil Case No. Q-41177 on the ground of non-payment of the correct and proper docket fee. Petitioners allege that while it may be true that private respondent had paid the amount of P182,824.90 as docket fee as herein-above related, and considering that the total amount sought to be recovered in the amended and supplemental complaint is P64,601,623.70 the docket fee that should be paid by private respondent is P257,810.49, more or less. Not having paid the same, petitioners contend that the complaint should be dismissed and all incidents arising therefrom should be annulled. In support of their theory, petitioner cite the latest ruling of the Court in Manchester Development Corporation v. CA, 4 as follows:jgc:chanrobles.com.ph

"The Court acquires jurisdiction over any case only upon the payment of the prescribed docket fee. An amendment of the complaint or similar pleading will not thereby vest jurisdiction in the Court, much less the payment of the docket fee based on the amounts sought in the amended pleading. The ruling in the Magaspi Case in so far it is inconsistent with this pronouncement is overturned and reversed."cralaw virtua1aw library

On the other hand, private respondent claims that the ruling in Manchester cannot apply retroactively to Civil Case No. Q-41177 for at the time said civil case was filed in court there was no such Manchester ruling as yet. Further, private respondent avers that what is applicable is the ruling of this Court in Magaspi v. Ramolete, 5 wherein this Court held that the trial court acquired

jurisdiction over the case even if the docket fee paid was insufficient.

The contention that Manchester cannot apply retroactively to this case is untenable. Statutes regulating the procedure of the courts will be construed as applicable to actions pending and undetermined at the time of their passage. Procedural laws are retrospective in that sense and to that extent. 6

In Lazaro v. Endencia and Andres, 7 this Court held that the payment of the full amount of the docket fee is an indispensable step for the perfection of an appeal. In a forcible entry and detainer case before the justice of the peace court of Manaoag, Pangasinan, after notice of a judgment dismissing the case, the plaintiff filed a notice of appeal with said court but he deposited only P8.00 for the docket fee, instead of P16.00 as required, within the reglementary period of appeal of five (5) days after receiving notice of judgment. Plaintiff deposited the additional P8.00 to complete the amount of the docket fee only fourteen (14) days later. On the basis of these facts, this court held that the Court of First Instance did not acquire jurisdiction to hear and determine the appeal as the appeal was not thereby perfected.

In Lee v. Republic, 8 the petitioner filed a verified declaration of intention to become a Filipino citizen by sending it through registered mail to the Office of the Solicitor General in 1953 but the required filing fee was paid only in 1956, barely 5-1/2 months prior to the filing of the petition for citizenship. This Court ruled that the declaration was not filed in accordance with the legal requirement that such declaration should be filed at least one year before the filing of the petition for citizenship. Citing Lazaro, this Court concluded that the filing of petitioner’s declaration of intention on October 23, 1953 produced no legal effect until the required filing fee was paid on May 23, 1956.chanrobles lawlibrary : rednad

In Malimit v. Degamo, 9 the same principles enunciated in Lazaro and Lee were applied. It was an original petition for quo warranto contesting the right to office of proclaimed candidates which was mailed, addressed to the clerk of the Court of First Instance, within the one-week period after the proclamation as provided therefor by law. 10 However, the required docket fees were paid only after the expiration of said period. Consequently, this Court held that the date of such payment must be deemed to be the real date of filing of aforesaid petition and not the date when it was mailed.

Again, in Garica v. Vasquez, 11 this Court reiterated the rule that the docket fee must be paid before a court will act on a petition or complaint. However, we also held that said rule is not applicable when petitioner seeks the probate of several wills of the same decedent as he is not required to file a separate action for each will but instead he may have other wills probated in the same special proceeding then pending before the same court.

Then in Magaspi, 12 this Court reiterated the ruling in Malimit and Lee that a case is deemed filed only upon payment of the docket fee regardless of the actual date of its filing in court. Said case involved a complaint for recovery of ownership and possession of a parcel of land with damages filed in the Court of First Instance of Cebu. Upon the payment of P60.00 for the docket fee and P10.00 for the sheriff’s fee, the complaint was docketed as Civil Case No. R-11882. The prayer of the complaint sought that the Transfer Certificate of Title issued in the name of the defendant be declared as null and void. It was also prayed that plaintiff be declared as owner thereof to whom the proper title should be issued, and that defendant be made to pay monthly rentals of P3,500.00 from June 2, 1948 up to the time the property is delivered to plaintiff, P500,000.00 as moral damages, attorney’s fees in the amount of P250,000.00, the costs of the action and exemplary damages in the amount of P500,000.00.

The defendant then filed a motion to compel the plaintiff to pay the correct amount of the docket fee to which an opposition was filed by the plaintiff alleging that the action was for the recovery of a parcel of land so the docket fee must be based on its assessed value and that the amount of P60.00 was the correct docketing fee. The trial court ordered the plaintiff to pay P3,140.00 as filing fee.

The plaintiff then filed a motion to admit the amended complaint to include the Republic as the defendant. In the prayer of the amended complaint the exemplary damages earlier sought was eliminated. The amended prayer merely sought moral damages as the court may determine, attorney’s fees of P100,000.00 and the costs of the action. The defendant filed an opposition to the amended complaint. The opposition notwithstanding, the amended complaint was admitted by the trial court. The trial court reiterated its order for the payment of the additional docket fee which plaintiff assailed and then challenged before this Court. Plaintiff alleged that he paid the total docket fee in the amount of P60.00 and that if he had to pay the additional fee it must be based on the amended complaint.

The question posed, therefore, was whether or not the plaintiff may be considered to have filed the case even if the docketing fee paid was not sufficient. In Magaspi, We reiterated the rule that the case was deemed filed only upon the payment of the correct amount for the docket fee regardless of the actual date of the filing of the complaint; that there was an honest difference of opinion as to the correct amount to be paid as docket fee in that as the action appears to be one for the recovery of property the docket fee of P60.00 was correct; and that as the action is also for damages, We upheld the assessment of the additional docket fee based on the damages alleged in the amended complaint as against the assessment of the trial court which was based on the damages alleged in the original complaint.chanrobles virtualawlibrary chanrobles.com:chanrobles.com.ph

However, as aforecited, this Court overturned Magaspi in Manchester. Manchester involves an action for torts and damages and specific performance with a prayer for the issuance of a temporary restraining order, etc. The prayer in said case is for the issuance of a writ of preliminary prohibitory injunction during the pendency of the action against the defendants’ announced forfeiture of the sum of P3 Million paid by the plaintiffs for the property in question, the attachment of such property of defendants that may be sufficient to satisfy any judgment that may be rendered, and, after hearing, the issuance of an order requiring defendants to execute a contract of purchase and sale of the subject property and annual defendants’ illegal forfeiture of the money of plaintiff. It was also prayed that the defendants be made to pay the plaintiff, jointly and severally, actual, compensatory and exemplary damages as well as 25% of said amounts as may be proved during the trial for attorney’s fees. The plaintiff also asked the trial court to declare the tender of payment of the purchase price of plaintiff valid and sufficient for purpose of payment, and to make the injunction permanent. The amount of damages sought is not specified in the prayer although the body of the complaint alleges the total amount of over P78 Million allegedly suffered by plaintiff.chanrobles virtual lawlibrary

Upon the filing of the complaint, the plaintiff paid the amount of only P410.00 for the docket fee based on the nature of the action for specific performance where the amount involved is not capable of pecuniary estimation. However, it was obvious from the allegation of the complaint as well as its designation that the action was one for damages and specific performance. Thus, this court held the plaintiff must be assessed the correct docket fee computed against the amount of damages of about P78 Million, although the same was not spelled out in the prayer of the complaint.

Meanwhile, plaintiff through another counsel, with leave of court, filed a amended complaint on September 12, 1985 by the inclusion of another co-plaintiff and eliminating any mention of the amount of damages in the body of the complaint. The prayer in the original complaint was maintained.

On October 15, 1985, this Court ordered the re-assessment of the docket fee in the said case and other cases that were investigated. On November 12, 1985 the trial court directed the plaintiff to rectify the amended complaint by stating the amounts which they were asking for. This plaintiff did as instructed. In the body of the complaint the amount of damages alleged was reduced to P10,000,000.00 but still no amount of damages was specified in the prayer. Said amended complaint was admitted.

Applying the principle in Magaspi that "the case is deemed filed only upon payment of the docket fee regardless of the actual date of filing in court," this Court held that the trial court did not acquire jurisdiction over the case by payment of only P410.00 for the docket fee. Neither can the amendment of the complaint thereby vest jurisdiction upon the Court. For all legal purposes they was no such original complaint duly filed which could be amended. Consequently, the order admitting the amended complaint and all subsequent proceedings and actions taken by the trial court were declared null and void. 13

The present case, as above discussed, is among the several cases of under-assessment of docket fee which were investigated by this Court together with Manchester. The facts and circumstances of this case are similar to Manchester. In the body of the original complaint, the total amount of damages sought amounted to about P50 Million. In the prayer, the amount of damages asked for was not stated. The action was for the refund of the premium and the issuance of the writ of preliminary attachment with damages. The amount of only P210.00 was paid for the docket fee. On January 23, 1986, private respondent filed an amended complaint wherein in the prayer it is asked that he be awarded no less than P10,000,000.00 as actual and exemplary damages but in the body of the complaint the amount of his pecuniary claim is approximately P44,601,623.70. Said amended complaint was admitted and the private respondent was reassessed the

additional docket fee of P39,786.00 based on his prayer of not less than P10,000,000.00 in damages, which he paid.

On April 24, 1986, private respondent filed a supplemental complaint alleging an additional claim of P20,000,000.00 in damages so that his total claim is approximately P64,601,620.70. On October 16, 1986, private respondent paid an additional docket fee of P80,396.00. After the promulgation of the decision of the respondent court on August 31, 1987 wherein private respondent was ordered to be reassessed for additional docket fee, and during the pendency of this petition, and after the promulgation of Manchester, on April 28, 1988, private respondent paid an additional docket fee on P62,132.92. Although private respondent appears to have paid a total amount of P182,824.90 for the docket fee considering the total amount of this claim in the amended and supplemental complaint amounting to about P64,601,620.70, petitioner insists that private respondent must pay a docket fee of P257,810.49.

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

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

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

Nevertheless, petitioners contend that the docket fee that was paid is still insufficient considering the total amount of the claim. This is a matter which the clerk of court of the lower court and/or his duly authorized docket clerk or clerk in-charge should determine and, thereafter, it any amount is found due, he must require the private respondent to pay the same.

Thus, the Court rules as follows:chanrob1es virtual 1aw library

1. It is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee, that vests a trial court with jurisdiction over the subject matter or nature of the action. Where the filing of the initiatory pleading is not accompanied by payment of the docket fee, the court may allow payment of the fee within a reasonable time but in no case beyond the applicable prescriptive or reglementary period.

2. The same rule applies to permissive counterclaims, third-party claims and similar pleadings, which shall not be considered filed until and unless the filing fee prescribed therefor is paid. The court may also allow payment of said fee within a reasonable time but also in no case beyond its applicable prescriptive or reglementary period.

3. Where the trial court acquires jurisdiction over a claim by the filing of the appropriate pleading and payment of the prescribed filing fee but, subsequently, the judgment awards a claim not specified in the pleading, or if specified the same has been left for determination by the court, the additional filing fee therefor shall constitute a lien on the judgment. It shall be the responsibility of the Clerk of Court or his duly authorized deputy to enforce said lien and assess and collect the additional fee.chanrobles.com:cralaw:nad

WHEREFORE, the petition is DISMISSED for lack of merit. The Clerk of Court of the court a quo is hereby instructed to reassess and determine the additional filing fee that should be paid by private respondent considering the total amount of the claim sought in the original complaint and the supplemental complaint as may be gleaned from the allegations and the prayer thereof and to require private respondent to pay the deficiency, if any, without pronouncement as to costs.

SO ORDERED.

Fernan, C.J., Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Feliciano, Padilla, Bidin, Sarmiento, Cortés, Griño-Aquino, Medialdea and Regalado, JJ., concur.

SECOND DIVISION

[G.R. No. 85879. September 29, 1989.]

NG SOON, Petitioner, v. HON. ALOYSIUS ALDAY, REGIONAL TRIAL COURT, QUEZON CITY, BILLIE GAN AND

CHINA BANKING CORPORATION, Respondents.

Braulio R.G. Tansinsin for Petitioner.

Augusto Gatmaytan for private respondent Billie T. Gan.

Del Rosario, Lim, Telan, De Vera & Vigilia for China Banking Corp.

SYLLABUS

1. REMDIAL LAW; EVIDENCE; LEGAL FEES; DAMAGES CONSIDERED IN THE ASSESSMENT OF FILING FEES. — Manchester laid down the rule that all Complaints should specify the amount of damages prayed for not only in the body of the complaint but also in the prayer; that said damages shall be considered in the assessment of the filing fees in any case; and that any pleading that fails to comply with such requirement shall not be accepted nor admitted, or shall, otherwise, be expunged from the record.

2. ID.; ID.; ID.; FAILURE TO STATE EXACT AMOUNT OF DAMAGES AND ATTORNEY’S FEES DOES NOT NEGATE COMPUTATION OF AMOUNT OF DOCKET FEE PAYABLE. — While it may be that the body of petitioner’s Complaint below was silent as to the exact amount of moral and exemplary damages, and attorney’s fees, the prayer did specify the amount of not less than P50,000.00 as moral and exemplary damages, and not less than P50,000.00 as attorney’s fees. These amounts were definite enough and enabled the Clerk of Court of the lower Court to compute the docket fees payable. The amounts claimed need not be initially stated with mathematical precision. The same Rule 141, Section 5(a) (3rd paragraph), allows an appraisal "more or less."cralaw virtua1aw library

3. ID.; ID.; ID.; FAILURE TO STATE RATE OF INTEREST DEMANDED, NOT FATAL. — The failure to state the rate of interest demanded was not fatal not only because it is the Courts which ultimately fix the same, but also because Rule 141, Section 5(a) of the Rules of Court, itemizing the filing fees, speaks of "the sum claimed, exclusive of interest." This clearly implies that the specification of the interest rate is not that indispensable.

4. ID.; ID.; ID.; FILING FEES SUBJECT TO ADJUSTMENT. — There is merit in petitioner’s claim that the third paragraph of Rule 141, Section 5(a) clearly contemplates a situation where an amount is alleged or claimed in the complaint but is less or more than what is later proved. If what is proved is less than what was claimed, then a refund will be made; if more, additional fees will be exacted. Otherwise stated, what is subject to adjustment is the difference in the fee and not the whole amount" (Pilipinas Shell Petroleum Corp., et als., v. Court of Appeals, et als., G.R. No. 76119, April 10, 1989).

5. ID.; ID.; ID.; RULING IN PAYMENT OF DOCKET FEE, RELAXED; PAYMENT WITHIN REASONABLE TIME, NOW ALLOWED. — In the case of Sun Insurance Office Ltd., Et Al., v. Hon. Maximiano Asuncion Et. Al. (G.R. Nos. 79937-38, February 13, 1989), this Court had already relaxed the Manchester rule when it held, inter alia,: "1. it is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee, that vests a trial court with jurisdiction over the subject matter or nature of the action. Where the filing of the initiatory pleading is not accompanied by payment of the docket fee, the court may allow payment of the fee within a reasonable time but in no case beyond the applicable prescriptive or reglementary period."cralaw virtua1aw library

6. ID.; SUPREME COURT; NOT A TRIER OF FACTS. — In respect of the questioned identity of petitioner, this is properly a matter falling within the competence of the Court a quo, this Court not being a trier of facts.

D E C I S I O N

MELENCIO-HERRERA, J.:

Applying literally the ruling on docket fees enunciated in Manchester Development Corporation v. Court of Appeals (L-75919, May 7, 1987, 149 SCRA 562), respondent Judge, on 11

August 1988, ordered (1) that petitioner’s Complaint below (in Civil Case No. Q-52489), for reconstitution of a savings account, and payment of damages and attorney’s fees, be expunged; and (2) that the case be dismissed. He also denied, on 21 October 1988, the reconsideration sought by petitioner of that Order.

The aforementioned savings account was allegedly maintained with the China Banking Corporation (CBC) by Gan Bun Yaw, both of whom are respondents herein. Petitioner, Ng Soon, claims to be the latter’s widow.

The pertinent portions of the Complaint and Prayer read as follows:jgc:chanrobles.com.ph

"2. During his lifetime, Mr. Gan Bun Yaw opened Savings Account No. 17591-2 with CBC wherein he deposited P900,000.00 more or less.

"3. Before his death on January 3, 1987 he lapsed into a coma until he finally took his last breath. But his passbook still showed a deposit of P900,000.00 more or less.

x x x

"5. For almost three (3) long years, she looked for the deposit passbook with the help of her children to no avail.

x x x

"7. She discovered further that aforesaid savings account was closed by defendant CBC on December 8, 1988. . . .

"8. She discovered finally that defendant Billie T. Gan connived and colluded with the officers and officials of CBC to withdraw all of the aforesaid savings account of Mr. Gan Bun Yaw by forging his signature. This has to be done because Mr. Gan Bun Yaw slipped into a comatose condition in the hospital and could not sign any withdrawal slip.

x x x

"11. Due to the wanton and unfounded refusal and failure of defendants to heed her just and valid demands, she suffered actual damages in the form of missing money in aforesaid savings account and expenses of litigation.

"12. Due also to the unfounded and malicious refusal of defendants to heed her just and valid demands, she suffered moral damages, the amount whereof she leaves to the discretion of the Court.

"13. Due likewise to the unfounded and wanton refusal and failure of defendants to heed her just and valid demands, she suffered exemplary damages, the amount whereof she leaves to the discretion of the Court.

"14. Due finally to the unfounded and wanton refusal and failure of defendants to heed her just and valid demands, she was constrained to hire the services of counsel, binding herself to pay the amount equivalent to twenty percent payable to her, thereby suffering to the tune thereof.

P R A Y E R

"WHEREFORE, plaintiff respectfully prays that this Honorable Court render judgment:jgc:chanrobles.com.ph

"1. Ordering defendants China Banking Corporation to reconstitute Savings Account No. 47591-2 in the name of Mr. Gan Bun Yaw in the amount of P900,000.00 with interest from December 8, 1977 or ordering them both to pay her the principal and interest from December 9, 1977, jointly and severally.

"2. Ordering both defendants to pay moral and exemplary damages of not less than P50,000.00.

"3. Ordering both defendants to pay her attorney’s fees equivalent to twenty percent of all amounts reconstituted or payable to her, but not less than P50,000.00.

"She prays for such other and further relief to which she may be entitled in law and equity under the premises." [Emphasis supplied] (pp. 11-13, Rollo).

For the filing of the above Complaint, petitioner paid the sum of P3,600.00 as docket fees.

Respondent Billie Gan and the Bank, respectively, moved for the dismissal of the Complaint. Subsequently, respondent Gan, joined by the Bank, moved to expunge the said Complaint from

the record for alleged non-payment of the required docket fees.

On 11 August 1988, respondent Judge issued the questioned Order granting the "Motion to Expunge Complaint." He explained:jgc:chanrobles.com.ph

"It can thus be seen that while it can be considered at best as impliedly specifying the amount (namely, P900,000.00, more or less) of what is referred to in its par. 11 as ‘missing money’ (which apparently is the main part of the alleged actual damages), the body of the complaint does not specify the following, to wit: the amount of the rest of the alleged actual damages; the amount of the alleged moral damages; the amount of the alleged exemplary damages; and, the amount of the alleged attorney’s fees . As regards the alleged attorney’s fees, in particular, the clause ‘the amount equivalent to twenty percent payable to her’ is vague and indefinite. It leaves to guesswork the determination of the exact amount relative to which the ‘twenty percent’ shall be reckoned. Is it the amount of P900,000.00, more or less? Or is it the total amount of all the actual damages? Or is it the grand total amount of all the damages — actual, moral, and exemplary — ‘payable to her’?

"As regards the prayer of the complaint, while it may be regarded as specific enough as to the principal sum of P900,000.00 as actual damages, it cannot be so regarded with respect to the amount of moral and exemplary damages (No. 2 of the prayer) and attorney’s fees (No. 3 of the prayer); for, evidently, the phrase ‘not less than P50,000.00’ in each of Nos. 2 and 3 of the prayer merely fixes the minimum amount, but it does not mean that plaintiff is not praying for an unspecified sum much higher than said minimum. And, again, the clause ‘equivalent to twenty percent of all amounts reconstituted or payable to her’ in No. 3 of the prayer is as vague and indefinite as the similar clause found in the complaint’s body referred to earlier. What exactly is the amount relative to which the ‘twenty percent’ shall be determined? Is it the amount of P900,000.00, more or less? Or is it the total amount of all the actual damages? Or is it the grand total amount of all the damages — actual, moral, and exemplary — ‘payable to her’? Certainly, the great difference between any of these amounts, on the one hand, and the amount of P50,000.00 in the phrase ‘not less than P50,000.00’ in No. 3 of the prayer, on the other hand, is quite too obvious to need underscoring.

"Needless to state, implicit in the obligation to specify is the duty to be clear and definite. A purported specification which is vague and indefinite obviously is no specification at all; indeed, it will serve no purpose other than to evade the payment of the correct filing fees by misleading the docket clerk in the assessment of the filing fees.

x x x

"WHEREFORE, the Court hereby grants defendants’ aforesaid ‘MOTION TO EXPUNGE COMPLAINT’ and hereby denies plaintiff’s aforesaid ‘URGENT OMNIBUS MOTION (ETC.)’ and ‘OPPOSITION (ETC.)’ inclusive of all the prayers contained therein and, accordingly, plaintiffs complaint herein is hereby deemed EXPUNGED from the record. Further, being rendered moot and academic as a result hereof, defendant Billie T. Gan’s ‘MOTION TO DISMISS’ dated April 25, 1988 and defendant China Banking Corporation’s ‘MOTION TO DISMISS’ dated May 25, 1988 are hereby dismissed." (pp. 16-18, Rollo)

Petitioner’s Motion for the reconsideration of the said Order having been denied, she asks for its review, more properly for a Writ of Certiorari.

The Petition is anchored on two grounds, namely:chanrob1es virtual 1aw library

1. The doctrine laid down in the Manchester case was incorrectly applied by respondent Judge; and

2. Respondent Judge acted with grave abuse of discretion when he ordered the Complaint expunged from the record although petitioner had paid the necessary filing fees.

During the pendency of this case, respondent Gan filed a Manifestation alleging, among others, that petitioner is an impostor and not the real Ng Soon, wife of Gan Bun Yaw, since the real Mrs. Gan Bun Yaw (Ng Soon) died on 29 July 1933, as shown by a Certificate issued on 27 April 1989 by, and bearing the seal of, the An Hai Municipal Government.

This allegation was, however, denied by petitioner in her "Sur-rejoinder to Manifestation" filed on 12 August 1989, to which respondent Gan has countered with a Reply on 9 September 1989.

We resolved to give due course to the Petition and dispensed with the submittal of Memoranda, the issues having been

thoroughly threshed out by the parties.

Upon the facts, the pleadings, and the law, we grant the Petition.

It is true that Manchester laid down the rule that all Complaints should specify the amount of damages prayed for not only in the body of the complaint but also in the prayer; that said damages shall be considered in the assessment of the filing fees in any case; and that any pleading that fails to comply with such requirement shall not be accepted nor admitted, or shall, otherwise, be expunged from the record.

While it may be that the body of petitioner’s Complaint below was silent as to the exact amount of moral and exemplary damages, and attorney’s fees, the prayer did specify the amount of not less than P50,000.00 as moral and exemplary damages, and not less than P50,000.00 as attorney’s fees. These amounts were definite enough and enabled the Clerk of Court of the lower Court to compute the docket fees payable.

Similarly, the principal amount sought to be recovered as "missing money" was fixed at P900,000.00. The failure to state the rate of interest demanded was not fatal not only because it is the Courts which ultimately fix the same, but also because Rule 141, Section 5(a) of the Rules of Court, itemizing the filing fees, speaks of "the sum claimed, exclusive of interest." This clearly implies that the specification of the interest rate is not that indispensable.

Factually, therefore, not everything was left to "guesswork" as respondent Judge has opined. The sums claimed were ascertainable, sufficient enough to allow a computation pursuant to Rule 141, section 5(a).

Furthermore, contrary to the position taken by respondent Judge, the amounts claimed need not be initially stated with mathematical precision. The same Rule 141, section 5(a) (3rd paragraph), allows an appraisal "more or less." Thus:jgc:chanrobles.com.ph

"In case the value of the property or estate or the sum claimed is less or more in accordance with the appraisal of the court, the difference of fee shall be refunded or paid as the case may be."cralaw virtua1aw library

In other words, a final determination is still to be made by the Court, and the fees ultimately found to be payable will either be additionally paid by the party concerned or refunded to him, as the case may be. The above provision clearly allows an initial payment of the filing fees corresponding to the estimated amount of the claim subject to adjustment as to what later may be proved.

". . . there is merit in petitioner’s claim that the third paragraph of Rule 141, Section 5(a) clearly contemplates a situation where an amount is alleged or claimed in the complaint but is less or more than what is later proved. If what is proved is less than what was claimed, then a refund will be made; if more, additional fees will be exacted. Otherwise stated, what is subject to adjustment is the difference in the fee and not the whole amount" (Pilipinas Shell Petroleum Corp., et als., v. Court of Appeals, et als., G.R. No. 76119, April 10, 1989).

Significantly, too, the pattern in Manchester to defraud the Government of the docket fee due, the intent not to pay the same having been obvious not only in the filing of the original complaint but also in the filing of the second amended complaint, is patently absent in this case. Petitioner demonstrated her willingness to abide by the Rules by paying the assessed docket fee of P3,600.00. She had also asked the lower Court to inform her of the deficiency, if any, but said Court did not heed her plea.

Additionally, in the case of Sun Insurance Office Ltd., Et Al., v. Hon. Maximiano Asuncion Et. Al. (G.R. Nos. 79937-38, February 13, 1989), this Court had already relaxed the Manchester rule when it held, inter alia,:jgc:chanrobles.com.ph

"1. it is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee, that vests a trial court with jurisdiction over the subject matter or nature of the action. Where the filing of the initiatory pleading is not accompanied by payment of the docket fee, the court may allow payment of the fee within a reasonable time but in no case beyond the applicable prescriptive or reglementary period" (Emphasis ours).

In respect of the questioned identity of petitioner, this is properly a matter falling within the competence of the Court a quo, this Court not being a trier of facts.

WHEREFORE, the assailed Orders of respondent Judge, dated 11 August 1988 and 21 October 1988, are SET ASIDE, and he is hereby directed to reinstate Civil Case No. Q-52489 for

determination and proper disposition of the respective claims and rights of the parties, including the controversy as to the real identity of petitioner. No costs.

SO ORDERED.

Paras, Padilla, Sarmiento and Regalado, JJ., concur.

EN BANC

[G.R. Nos. 88075-77. December 20, 1989.]

MAXIMO TACAY, PONCIANO PANES and ANTONIA NOEL, Petitioners, v. REGIONAL TRIAL COURT OF TAGUM,

Davao del Norte, Branches 1 and 2, Presided by Hon. Marcial Fernandez and Hon. Jesus Matas, respectively, PATSITA GAMUTAN, Clerk of Court, and GODOFREDO

PINEDA, Respondents.

Eduardo C. De Vera for petitioners.

SYLLABUS

1. REMEDIAL LAW; CIVIL PROCEDURE; REAL ACTIONS COMMENCED AND PROSECUTED WITHOUT AN ACCOMPANYING CLAIM FOR DAMAGES; WITHIN THE EXCLUSIVE, ORIGINAL JURISDICTION OF THE REGIONAL TRIAL COURT. — The actions in the case at bar are principally for recovery of possession of real property, in the nature of an accion publiciana. Determinative of the court’s jurisdiction in this type of actions is the nature thereof, not the amount of the damages allegedly arising from or connected with the issue of title or possession, and regardless of the value of the property. Quite obviously, an action for recovery of possession of real property (such as an accion plenaria de posesion) or the title thereof, or for partition or condemnation of, or the foreclosure of a mortgage on, said real property — in other words, a real action — may be commenced and prosecuted without an accompanying claim for actual, moral, nominal or exemplary damages; and such an action would fall within the exclusive, original jurisdiction of the Regional Trial Court.

2. ID.; BATAS PAMBANSA BLG. 129; EXCLUSIVE ORIGINAL JURISDICTION OF REGIONAL TRIAL COURT; SCOPE. — Batas Pambansa Bilang 129 provides that Regional Trial Courts shall exercise exclusive original jurisdiction inter alia over "all civil actions which involve the title to, or possession of, real property, or any interest therein, except actions for forcible entry into and unlawful detainer of lands or buildings, original jurisdiction over which is conferred upon Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts." The rule applies regardless of the value of the real property involved, whether it be worth more than P20,000.00 or not, infra. The rule also applies even where the complaint involving realty also prays for an award of damages; the amount of those damages would be immaterial to the question of the Court’s jurisdiction. The rule is unlike that in other cases — e.g., actions simply for recovery of money or of personal property, or actions in admiralty and maritime jurisdiction — in which the amount claimed, or the value of the personal property, is determinative of jurisdiction; i.e., the value of the personal property or the amount claimed should exceed twenty thousand pesos (P20,000.00) in order to be cognizable by the Regional Trial Court.

3. ID.; SUPREME COURT NO. 7; PURPOSE. — Circular No. 7 was aimed at the practice of certain parties who omit from the prayer of their complaints "any specification of the amount of damages," the omission being "clearly intended for no other purposes than to evade the payment of the correct filing fees if not to mislead the docket clerk, in the assessment of the filing fee."cralaw virtua1aw library

4. ID.; ID.; TRIAL COURT AUTHORIZED TO ALLOW PAYMENT OF FILING FEES WITHIN PRESCRIPTIVE OF REGLEMENTARY PERIOD. — The requirement in Circular No. 7 that complaints, petitions, answers, and similar pleadings should specify the amount of damages being prayed for not only in the body of the pleading but also in the prayer, has not been altered by the clarification and additional rules paid down in Sun Insurance Office, Ltd. v. Asuncion, G.R. No.s 79937-38, February 13, 1989. What has been revised is the rule that subsequent "amendment of the complaint or similar pleading will not thereby vest jurisdiction in the Court, much less the payment of the docket fee based on the amount sought in the amended pleading," the trial court now being authorized to allow payment of the fee within a reasonable time but in no case beyond the applicable prescriptive or reglementary period.

5. ID.; ID.; ID.; RULE WHERE JUDGMENT AWARDS A CLAIM NOT SPECIFIED IN THE PLEADING. — A new rule has been added, governing awards of claims not specified in the pleading — i.e.,

damages arising after the filing of the complaint or similar pleading — as to which the additional filing fee therefor shall constitute a lien on the judgment.

6. ID.; ID.; ACTION FOR RECOVERY OF MONEY OR DAMAGES; AMOUNT CLAIMED MUST BE SPECIFIED NOT ONLY IN THE BODY OF THE PLEADING BUT ALSO IN THE PRAYER. — Where the action is purely for the recovery of money or damages, the docket fees are assessed on the basis of the aggregate amount claimed, exclusive only of interests and costs. In this case, the complaint or similar pleading should, according to Circular No. 7 of this Court, "specify the amount of damages being prayed for not only in the body of the pleading but also in the prayer, and said damages shall be considered in the assessment of the filing fees in any case."cralaw virtua1aw library

7. ID.; ID.; ID.; RULES WHERE NO AMOUNT BEING CLAIMED IS SPECIFIED OR FEES PAID ARE INSUFFICIENT. — Where the complaint or similar pleading sets out a claim purely for money or damages and there is no precise statement of the amounts being claimed. In this event the rule is that the pleading will "not be accepted nor admitted, or shall otherwise be expunged from the record." In other words, the complaint or pleading may be dismissed, or the claims as to which the amounts are unspecified may be expunged, although as aforestated the Court may, on motion, permit amendment of the complaint and payment of the fees provided the claim has not in the meantime become time-barred. The other is where the pleading does specify the amount of every claim, but the fees paid are insufficient; and here again, the rule now is that the court may allow a reasonable time for the payment of the prescribed fees, or the balance thereof, and upon such payment, the defect is cured and the court may properly take cognizance of the action, unless in the meantime prescription has set in and consequently barred the right of action.

8. ID.; COURT ACQUIRES JURISDICTION OVER ACTION OF ACCOMPANIED BY REQUISITE FEES ON REAL ACTIONS WITH CLAIM FOR DAMAGES. — Where the action involves real property and a related claim for damages as well, the legal fees shall be assessed on the basis of both (a) the value of the property and (b) the total amount of related damages sought. The Court acquires jurisdiction over the action if the filing of the initiatory pleading is accompanied by the payment of the requisite fees, or, if the fees are not paid at the time of the filing of the pleading, as of the time of full payment of the fees within such reasonable time as the court may grant, unless, of course, prescription has set in the meantime.

9. ID.; ID.; FAILURE TO SPECIFY AMOUNT OF DAMAGES BEING CLAIMED NOT FATAL; PROPER REMEDY THEREFOR. — When — the fees prescribed for an action involving real property have been paid, but the amounts of certain of the related damages (actual, moral and nominal) being demanded are unspecified, the action may not be dismissed. The Court undeniably has jurisdiction over the action involving the real property, acquiring it upon the filing of the complaint or similar pleading and payment of the prescribed fee. And it is not divested of that authority by the circumstance that it may not have acquired jurisdiction over the accompanying claims or damages because of lack of specification thereof. What should be done is simply to expunge those claims for damages as to which no amounts are stated, which is what the respondent Courts did, or allow, on motion, a reasonable time for the amendment of the complaints so as to allege the precise amount of each item of damages and accept payment of the requisite fees therefor within the relevant prescriptive period.

R E S O L U T I O N

NARVASA, J.:

In the Regional Trial Court at Tagum, Davao del Norte, 1 three (3) actions for recovery of possession (acciones publicianas 2) were separately instituted by Godofredo Pineda against three (3) defendants, docketed as follows:chanrob1es virtual 1aw library

1) v. Antonia Noel Civil Case No. 2209

2) v. Ponciano Panes Civil Case No. 2210

3) v. Maximo Tacay Civil Case No. 2211.

Civil Cases Numbered 2209 and 2211 were raffled to Branch I of the Trial Court, presided over by Judge Marcial Hernandez. Civil No. 2210 was assigned to Branch 2, presided over by Judge Jesus Matas.

The complaints 3 all alleged the same essential facts: (1) Pineda was the owner of a parcel of land measuring 790 square meters,

his ownership being evidenced by TCT No. T-46560; (2) the previous owner had allowed the defendants to occupy portions of the land by mere tolerance; (3) having himself need to use the property, Pineda had made demands on the defendants to vacate the property and pay reasonable rentals therefor, but these demands had been refused; and (4) the last demand had been made more than a year prior to the commencement of suit. The complaints prayed for the same reliefs, to wit:chanrob1es virtual 1aw library

1) that plaintiff be declared owner of the areas occupied by the defendants;

2) that defendants and their "privies and allies" be ordered to vacate and deliver the portions of the land usurped by them;

3) that each defendant be ordered to pay:chanrob1es virtual 1aw library

1) P2,000 as monthly rents from February, 1987;

2) "Actual damages, as proven;

3) "Moral and nominal damages as the Honorable Court may fix;" 4

4) "P30,000.00, "as attorney’s fees, and representation fees of P5,000.00 per day of appearance;"

and

4) that he (Pineda) be granted such "further relief and remedies . . .just and equitable in the premises."cralaw virtua1aw library

The prayer of each complaint contained a handwritten notation (evidently made by plaintiff’s counsel) reading, "P5,000.00 as and for," immediately above the typewritten words, "Actual damages, as proven," the intention apparently being to make the entire phrase read, "5,000.00 as and for actual damages as proven." 5

Motions to dismiss were filed in behalf of each of the defendants by common counsel. 6 Every motion alleged that the Trial Court had not acquired jurisdiction of the case —

". . . for the reason that the . . . complaint violates the mandatory and clear provision of Circular No. 7 of the . . . Supreme Court dated March 24, 1988, by failing to specify all the amounts of damages which plaintiff is claiming from defendant;" and.

". . . for . . . failure (of the complaint) to even allege the basic requirement as to the assessed value of the subject lot in dispute."cralaw virtua1aw library

Judge Matas denied the motion to dismiss filed in Civil Case No. 2210 but ordered the expunction of the "allegations in paragraph 11 of the . . . complaint regarding moral as well as nominal damages." 7 On motion of defendant Panes, Judge Matas later ordered the striking out, too, of the "handwritten amount of ‘P5,000.00 as and for,’ including the typewritten words ‘actual damages as proven’ . . . in sub-paragraph b of paragraph 4 in the conclusion and prayer of the complaint . . .." 8

The motions to dismiss submitted in Civil Cases Numbered 2211 and 2209 were also denied in separate orders promulgated by Judge Marcial Fernandez. 9 His Order in Case No. 2209 dated March 15, 1989 (a) declared that since the "action at bar is for Reivindicatoria, Damages and Attorney’s fees . . . (d)efinitely this Court has the exclusive jurisdiction," (b) that the claims for actual, moral and nominal damages "are only one aspect of the cause of action," and (c) because of absence of specification of the amounts claimed as moral, nominal and actual damages, they should be "expunged from the records."cralaw virtua1aw library

Ascribing grave abuse of discretion to both Judges Matas and Fernandez in the rendition of the Orders above described, the defendants in all three (3) actions have filed with this Court a "Joint Petition" for certiorari, prohibition and mandamus, with prayer for temporary restraining order and/or writ of preliminary prohibitory injunction," praying essentially that said orders be annulled and respondent judges directed to dismiss all the complaints "without prejudice to private respondent Pineda’s re-filing a similar complaint that complies with Circular No. 7." The joint petition (a) re-asserted the proposition that because the complaints had failed to state the amounts being claimed as actual, moral and nominal damages, the Trial Courts a quo had not acquired jurisdiction over the three (3) actions in question — indeed, the respondent Clerk of Court should not have accepted the complaints which initiated said suits, and (b) it was not proper merely to expunge the claims for damages and allow "the so-called cause of action for ‘reivindicatoria’ to remain for trial" by itself. 10

The joint petition should be, as it is hereby, dismissed.

It should be dismissed for failure to comply with this Court’s Circular No. 1-88 (effective January 1, 1989). The copies of the challenged Orders thereto attached 11 were not certified by the proper Clerk of Court or his duly authorized representative. Certification was made by the petitioners’ counsel, which is not allowed.

The petition should be dismissed, too, for another equally important reason. It fails to demonstrate any grave abuse of discretion on the part of the respondent Judges in rendering the Orders complained of or, for that matter, the existence of any proper cause for the issuance of the writ of mandamus. On the contrary, the orders appear to have correctly applied the law to the admitted facts.chanroblesvirtualawlibrary

It is true that the complaints do not state the amounts being claimed as actual, moral and nominal damages. It is also true, however, that the actions are not basically for the recovery of sums of money. They are principally for recovery of possession of real property, in the nature of an accion publiciana. Determinative of the court’s jurisdiction in this type of actions is the nature thereof, not the amount of the damages allegedly arising from or connected with the issue of title or possession, and regardless of the value of the property. Quite obviously, an action for recovery of possession of real property (such as an accion plenaria de posesion) or the title thereof, 12 or for partition or condemnation of, or the foreclosure of a mortgage on, said real property 13 — in other words, a real action — may be commenced and prosecuted without an accompanying claim for actual, moral, nominal or exemplary damages; and such an action would fall within the exclusive, original jurisdiction of the Regional Trial Court.cralawnad

Batas Pambansa Bilang 129 provides that Regional Trial Courts shall exercise exclusive original jurisdiction inter alia over "all civil actions which involve the title to, or possession of, real property, or any interest therein, except actions for forcible entry into and unlawful detainer of lands or buildings, original jurisdiction over which is conferred upon Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts." 14 The rule applies regardless of the value of the real property involved, whether it be worth more than P20,000.00 or not, infra. The rule also applies even where the complaint involving realty also prays for an award of damages; the amount of those damages would be immaterial to the question of the Court’s jurisdiction. The rule is unlike that in other cases — e.g., actions simply for recovery of money or of personal property, 15 or actions in admiralty and maritime jurisdiction 16 — in which the amount claimed, 17 or the value of the personal property, is determinative of jurisdiction; i.e., the value of the personal property or the amount claimed should exceed twenty thousand pesos (P20,000.00) in order to be cognizable by the Regional Trial Court.

Circular No. 7 of this Court, dated March 24, 1988, cannot thus be invoked, as the petitioner does, as authority for the dismissal of the actions at bar. That circular, avowedly inspired by the doctrine laid down in Manchester Development Corporation v. Court of Appeals, 149 SCRA 562 (May 7, 1987), has but limited application to said actions, as shall presently be discussed. Moreover, the rules therein laid down have since been clarified and amplified by the Court’s subsequent decision in Sun Insurance Office, Ltd. (SIOL) v. Asuncion, Et Al., G.R. Nos. 79937-38, February 13, 1989.

Circular No. 7 was aimed at the practice of certain parties who omit from the prayer of their complaints "any specification of the amount of damages," the omission being "clearly intended for no other purposes than to evade the payment of the correct filing fees if not to mislead the docket clerk, in the assessment of the filing fee." The following rules were therefore set down:chanrob1es virtual 1aw library

1. All complaints, petitions, answers, and similar pleadings should specify the amount of damages being prayed for not only in the body of the pleading but also in the prayer, and said damages shall be considered in the assessment of the filing fees in any case.

2. Any pleading that fails to comply with this requirement shall not be accepted nor admitted, or shall otherwise be expunged from the record.

3. The Court acquires jurisdiction over any case only upon the payment of the prescribed docket fee. An amendment of the complaint or similar pleading will not thereby vest jurisdiction in the Court, much less the payment of the docket fee based on the amount sought in the amended pleading.

The clarificatory and additional rules laid down in Sun Insurance Office, Ltd v. Asuncion, supra, read as follows:chanrob1es virtual 1aw library

1. It is not simply the filing of the complaint or appropriate initiatory pleading, but (also) the payment of the prescribed docket fee that vests a trial court with jurisdiction over the subject-matter or nature of the action. Where the filing of the initiatory pleading is not accompanied by payment of the docket fee, the court may allow payment of the fee within a reasonable time but in no ease beyond the applicable prescriptive or reglementary period.


3. Where the trial court acquires jurisdiction over a claim by the filing of the appropriate pleading and payment of the prescribed filing fee but, subsequently, the judgment awards a claim not specified in the pleading, or if specified, the same has been left for determination by the court, the additional filing fee therefor shall constitute a lien on the judgment. It shall be the responsibility of the Clerk of Court or his duly authorized deputy to enforce said lien and assess and collect the additional fee."cralaw virtua1aw library

As will be noted, the requirement in Circular No. 7 that complaints, petitions, answers, and similar pleadings should specify the amount of damages being prayed for not only in the body of the pleading but also in the prayer, has not been altered. What has been revised is the rule that subsequent "amendment of the complaint or similar pleading will not thereby vest jurisdiction in the Court, much less the payment of the docket fee based on the amount sought in the amended pleading," the trial court now being authorized to allow payment of the fee within a reasonable time but in no case beyond the applicable prescriptive or reglementary period. Moreover, a new rule has been added, governing awards of claims not specified in the pleading — i.e., damages arising after the filing of the complaint or similar pleading — as to which the additional filing fee therefor shall constitute a lien on the judgment.chanrobles virtual lawlibrary

Now, under the Rules of Court, docket or filing fees are assessed on the basis of the "sum claimed," on the one hand, or the "value of the property in litigation or the value of the estate," on the other. 18 There are, in other words, as already above intimated, actions or proceedings involving real property, in which the value of the property is immaterial to the court’s jurisdiction, account thereof being taken merely for assessment of the legal fees; and there are actions or proceedings, involving personal property or the recovery of money and/or damages, in which the value of the property or the amount of the demand is decisive of the trial court’s competence (aside from being the basis for fixing the corresponding docket fees). 19

Where the action is purely for the recovery of money or damages, the docket fees are assessed on the basis of the aggregate amount claimed, exclusive only of interests and costs. In this case, the complaint or similar pleading should, according to Circular No. 7 of this Court, "specify the amount of damages being prayed for not only in the body of the pleading but also in the prayer, and said damages shall be considered in the assessment of the filing fees in any case."cralaw virtua1aw library

Two situations may arise. One is where the complaint or similar pleading sets out a claim purely for money or damages and there is no precise statement of the amounts being claimed. In this event the rule is that the pleading will "not be accepted nor admitted, or shall otherwise be expunged from the record." In other words, the complaint or pleading may be dismissed, or the claims as to which the amounts are unspecified may be expunged, although as aforestated the Court may, on motion, permit amendment of the complaint and payment of the fees provided the claim has not in the meantime become time-barred. The other is where the pleading does specify the amount of every claim, but the fees paid are insufficient; and here again, the rule now is that the court may allow a reasonable time for the payment of the prescribed fees, or the balance thereof, and upon such payment, the defect is cured and the court may properly take cognizance of the action, unless in the meantime prescription has set in and consequently barred the right of action.

Where the action involves real property and a related claim for damages as well, the legal fees shall be assessed on the basis of both (a) the value of the property and (b) the total amount of related damages sought. The Court acquires jurisdiction over the action if the filing of the initiatory pleading is accompanied by the payment of the requisite fees, or, if the fees are not paid at the time of the filing of the pleading, as of the time of full payment of the fees within such reasonable time as the court

may grant, unless, of course, prescription has set in the meantime. But where — as in the case at bar — the fees prescribed for an action involving real property have been paid, but the amounts of certain of the related damages (actual, moral and nominal) being demanded are unspecified, the action may not be dismissed. The Court undeniably has jurisdiction over the action involving the real property, acquiring it upon the filing of the complaint or similar pleading and payment of the prescribed fee. And it is not divested of that authority by the circumstance that it may not have acquired jurisdiction over the accompanying claims or damages because of lack of specification thereof. What should be done is simply to expunge those claims for damages as to which no amounts are stated, which is what the respondent Courts did, or allow, on motion, a reasonable time for the amendment of the complaints so as to allege the precise amount of each item of damages and accept payment of the requisite fees therefor within the relevant prescriptive period.chanrobles virtual lawlibrary

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

Fernan (C.J.), Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Feliciano, Gancayco, Padilla, Bidin, Sarmiento, Cortés, Griño-Aquino, Medialdea and Regalado, JJ., concur.

FIRST DIVISION

[G.R. No. 88421. January 30, 1990.]

AYALA CORPORATION, LAS PIÑAS VENTURES, INC., AND FILIPINAS LIFE ASSURANCE COMPANY, INC., Petitioners, v. THE HONORABLE JOB B. MADAYAG, PRESIDING JUDGE,

REGIONAL TRIAL COURT, NATIONAL CAPITAL JUDICIAL REGION, BRANCH 145 and THE SPOUSES CAMILO AND MA.

MARLENE SABIO, Respondents.

Renato L. De la Fuente, for Petitioners.

Camilo L. Sabio for Private Respondents.

SYLLABUS

1. CIVIL LAW; SPECIFIC PERFORMANCE WITH DAMAGES; ADDITIONAL FILING FEE CONSTITUTE A LIEN ON THE JUDGMENT WHEN DAMAGES AROSE AFTER THE FILING OF THE COMPLAINT. — The trial court misinterpreted paragraph 3 of the above ruling of this Court wherein it is stated that "where the judgment awards a claim not specified in the pleading, or if specified, the same has been left for the determination of the court, the additional filing fee therefor shall constitute a lien on the judgment" by considering it to mean that where in the body and prayer of the complaint there is a prayer, say for exemplary or corrective damages, the amount of which is left to the discretion of the Court, there is no need to specify the amount being sought, and that any award thereafter shall constitute a lien on the judgment.

2. ID.; ID.; RULE IN THE PROPER DETERMINATION OF THE AMOUNT OF DAMAGES. — In the latest case of Tacay v. Regional Trial Court of Tagum, this Court had occasion to make the clarification that the phrase "awards of claims not specified in the pleading" refers only to "damages arising after the filing of the complaint or similar pleading . . . . as to which the additional filing fee therefor shall constitute a lien on the judgment." The amount of any claim for damages, therefore, arising on or before the filing of the complaint or any pleading should be specified. While it is true that the determination of certain damages as exemplary or corrective damages is left to the sound discretion of the court, it is the duty of the parties claiming such damages to specify the amount sought on the basis of which the court may make a proper determination, and for the proper assessment of the appropriate docket fees. The exception contemplated as to claims not specified or to claims although specified are left for determination of the court is limited only to any damages that may arise after the filing of the complaint or similar pleading for then it will not be possible for the claimant to specify nor speculate as to the amount thereof.

3. ID.; ID.; EFFECT OF FAILURE TO STATE THE PRECISE AMOUNT OF EXEMPLARY DAMAGES IN THE AMENDED AND SUPPLEMENTAL COMPLAINT. — The amended and supplemental complaint in the present case, therefore, suffers from the material defect in failing to state the amount of exemplary damages prayed for. As ruled in Tacay the trial court may either order said claim to be expunged from the record as it did not acquire jurisdiction over the same or on motion, it may allow, within a reasonable time, the amendment of the amended and supplemental complaint so as to state the precise amount of the exemplary damages sought

and require the payment of the requisite fees therefor within the relevant prescriptive period.

D E C I S I O N

GANCAYCO, J.:

Once more the issue relating to the payment of filing fees in an action for specific performance with damages is presented by this petition for prohibition.

Private respondents filed against petitioners an action for specific performance with damages in the Regional Trial Court of Makati. Petitioners filed a motion to dismiss on the ground that the lower court has not acquired jurisdiction over the case as private respondents failed to pay the prescribed docket fee and to specify the amount of exemplary damages both in the body and prayer of the amended and supplemental complaint. The trial court denied the motion in an order dated April 5, 1989. A motion for reconsideration filed by petitioners was likewise denied in an order dated May 18, 1989. Hence this petition.chanrobles.com : virtual law library

The main thrust of the petition is that private respondent paid only the total amount of P1,616.00 as docket fees instead of the amount of P13,061.35 based on the assessed value of the real properties involved as evidenced by its tax declaration. Further, petitioners contend that private respondents failed to specify the amount of exemplary damages sought both in the body and the prayer of the amended and supplemental complaint.

In Manchester Development Corporation v. Court of Appeals 1 a similar case involving an action for specific performance with damages, this Court held that the docket fee should be assessed by considering the amount of damages as alleged in the original complaint.

However, the contention of petitioners is that since the action concerns real estate, the assessed value thereof should be considered in computing the fees pursuant to Section 5, Rule 141 of the Rules of Court. Such rule cannot apply to this case which is an action for specific performance with damages although it is in relation to a transaction involving real estate. Pursuant to Manchester, the amount of the docket fees to be paid should be computed on the basis of the amount of damages stated in the complaint.

Petitioners also allege that because of the failure of the private respondents to state the amount of exemplary damages being sought, the complaint must nevertheless be dismissed in accordance to Manchester. The trial court denied the motion stating that the determination of the exemplary damages is within the sound discretion of the court and that it would be unwarrantedly presumptuous on the part of the private respondents to fix the amount of exemplary damages being prayed for. The trial court cited the subsequent case of Sun Insurance v. Judge Asuncion 2 in support of its ruling.

The clarificatory and additional rules laid down in Sun Insurance are as follows:chanrob1es virtual 1aw library

1. It is not simply the filing of the complaint or appropriate initiatory pleading, but (also) the payment of the prescribed docket fee that vests a trial court with jurisdiction over the subject-matter or nature of the action. Where the filing of the initiatory pleading is not accompanied by payment of the docket fee, the court may allow payment of the fee within a reasonable time but in no case beyond the applicable prescriptive or reglementary period.


3. Where the trial court acquires jurisdiction over a claim by the filing of the appropriate pleading and payment of the prescribed filing fee but, subsequently, the judgment awards a claim not specified in the pleading, or if specified, the same has been left for determination by the court, the additional filing fee therefor shall constitute a lien on the judgment. It shall be the responsibility of the Clerk of Court or his duly authorized deputy to enforce said lien and assess and collect the additional fee."cralaw virtua1aw library

Apparently, the trial court misinterpreted paragraph 3 of the above ruling of this Court wherein it is stated that "where the judgment awards a claim not specified in the pleading, or if

specified, the same has been left for the determination of the court, the additional filing fee therefor shall constitute a lien on the judgment" by considering it to mean that where in the body and prayer of the complaint there is a prayer, say for exemplary or corrective damages, the amount of which is left to the discretion of the Court, there is no need to specify the amount being sought, and that any award thereafter shall constitute a lien on the judgment.chanrobles.com.ph : virtual law library

In the latest case of Tacay v. Regional Trial Court of Tagum, 3 this Court had occasion to make the clarification that the phrase "awards of claims not specified in the pleading" refers only to "damages arising after the filing of the complaint or similar pleading . . . . as to which the additional filing fee therefor shall constitute a lien on the judgment." The amount of any claim for damages, therefore, arising on or before the filing of the complaint or any pleading should be specified. While it is true that the determination of certain damages as exemplary or corrective damages is left to the sound discretion of the court, it is the duty of the parties claiming such damages to specify the amount sought on the basis of which the court may make a proper determination, and for the proper assessment of the appropriate docket fees. The exception contemplated as to claims not specified or to claims although specified are left for determination of the court is limited only to any damages that may arise after the filing of the complaint or similar pleading for then it will not be possible for the claimant to specify nor speculate as to the amount thereof.

The amended and supplemental complaint in the present case, therefore, suffers from the material defect in failing to state the amount of exemplary damages prayed for.

As ruled in Tacay the trial court may either order said claim to be expunged from the record as it did not acquire jurisdiction over the same or on motion, it may allow, within a reasonable time, the amendment of the amended and supplemental complaint so as to state the precise amount of the exemplary damages sought and require the payment of the requisite fees therefor within the relevant prescriptive period. 4

WHEREFORE, the petition is GRANTED. The trial court is directed either to expunge from the record the claim for exemplary damages in the amended and supplemental complaint, the amount of which is not specified, or it may otherwise, upon motion, give reasonable time to private respondents to amend their pleading by specifying its amount and paying the corresponding docketing fees within the appropriate reglementary or prescriptive period. No costs.chanrobles virtual lawlibrary

SO ORDERED.

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

EN BANC

G.R. No. L-21706 March 26, 1924

JOSEFINA RUBIO VDA. DE LARENA, plaintiff-appellee, vs.HERMENEGILDO VILLANUEVA, defendant-appellant.

Del Rosario and Del Rosario for appellant.Francisco Zialcita for appellee.

OSTRAND, J.:

This action is brought by a lessor against her lessee for the rescission of the contract of lease on the ground that the lessee has violated the terms of the contract by failing to pay the rent therein specified. The plaintiff also asks judgment for overdue and unpaid rent in the sum of P6,278.68, as well as for rent which may have become due during the period between the filing of the complaint and the execution of the judgment to be rendered, together with the costs and the sum of P2,000 for attorney's fees. The defendant's amended answer denies that he has breached the contract and sets up a counterclaim in the sum of P2,051.52 for money advanced to the plaintiff in excess of the rent due under the contract.

The trial court rendered judgment in favor of the plaintiff for the rescission of the lease, for the unpaid balance of the rent for the agricultural year 1920-1921 in the sum of P5,949.28, with interest from August 26, 1922, the date of the filing of the complaint, and for the rent for the agricultural year 1922-1923, with costs. From this judgment the defendant appeals to this court.

The decision turns upon the interpretation of the contract in question which was executed on August 2, 1920, and which reads as follows:

Este contrato de arrendamiento es sostenido por una parte por la arrendadora D.a Josefina Rubio, Viuda de Larena, duena y propietaria de la Hacienda Tacgajan, ubicada en este Municipio de Bais, Negros Oriental, I. F., y por otra parte por los arrendatarios Hermenegildo Villanueva y Mateo Montenegro, todos mayores de edad y vecinos de este municipio, con capacidad legal para contratar y otorgar el presente contrato de arrendamiento, y solemnemente manifiestan que de comun acuerdo pactan lo siguiente:

1.º Que D.a Josefina Rubio, Vda. de Larena, cede en arriendo a los Sres. Hermenegildo Villanueva y Mateo Montenegro por un periodo consecutivo de cinco años, o sea, cinco cosechas completas, su hacienda cana dulce denominada Tacgajan con todos sus terrenos, edificios, mejoras, tranvia, ganado de labor, cerros, aperos de labranza y demas implementos agricolas, especificado todo en el inventario que se acompanara a la presente escritura, incluyendo todas las siembras existentes asi como una parcela de terreno, o sea la parte de que la arrendadora es propietaria situada al lado del riachuelo que circunda la Hacienda Tacgajan. No se entiende incluidos en este contrato la tractora, huerta y cementerio.

2.º Que los Sres. Hermenegildo Villanueva y Mateo Montenegro aceptan este contrato bajo el pago anual de ocho mil pesos (P8,000) pagando cada cual la parte que le corresponde, o sea cuatro mil pesos (P4,000) que paga Mateo Motenegro, y cuatro mil pesos (P4,000) Hermenegildo Villanueva, ambos se entenderan directamente con la arrendadora.

3.º La duracion de este contrato sera de cinco años o sea cinco cosechas completas, contando con la cosecha actual de 1920-1921, hasta la cosecha de 1925-1926.

4.º Inmediatamente despues de firmado el presente contrato, la arrendadora dara posesion a los arrendatarios de la Hacienda libre de toda carga y gravamen, haciendose estos cargo de todas las cosas inventariadas con la obligacion de cuidarlas con la diligencia conveniente y devolverlas a la arrendadora, a la expiracion del arriendo tal como han sido recibidas, excepto aquellas cosas que por deterioro natural hiciera inutil todo esfuerzo que los arrendatarios emplearen por conservarlas, pero los referidos arrendatarios seran sin embargo responsables de la reposicion de todo ganado mayor de labor incluido en el inventario, despues de que han sido asegurados inmediatamente bajo la Ley de Seguros de Animales de Labor.

5.º Los arrendatarios respetaran el contrato que la arrendadora tiene con la central como si la Hacienda Tacgajan continuara en poder de ella. Asimismo permitiran a la continuacion en sus respectivas aparcerias a D. a Agueda Somosa y Demetrio Larena.

6.º Los arrendatarios no podran transpasar sus derechos de tales sin el consentimiento de la arrendadora.

7.º Todas las mejoras permanentes que dejaren los arrendatarios a la expiracion del presente contrato quedaran en beneficio de la Hacienda a libre disposicion de la arrendadora D.a Josefina.

8. El incumplimiento de cualquiera de las dos partes contratantes dara derecho a la otra a la rescision del presente contrato.

Asi han convenido y pactado todas las partes contratantes que firman el presente contrato con las copias necesarias para cada interesado.

Subsequently to the execution of the contract quoted, the defendant, with the consent of the plaintiff, assumed the obligations of Mateo Montenegro under the lease.

It will be noted that paragraph 3 of the contract contains an apparent contradiction inasmuch as it fixes the term of the contract at "five years, that is to say, five complete crops, beginning with the present crop 1920-1921 until the crop of

1925-1926." It may also be noted that the land in question is used for the cultivation of sugar cane and the years are counted by agricultural years and not by calendar years. If the duration of the lease is for five annual crops, beginning with the crop of 1920-1921, the term will expire with the crop of 1924-1925 and not with the crop of 1925-1926. The plaintiff maintains that the number of crops control in computing the term of the lease and that the insertion of the figures "1925-1926" in the third paragraph of the lease is due to a miscalculation and should read "1924-1925."

It is conceded that sugar cane requires at least fourteen months from the time of planting for its full development, so that cane planted in the fall of 1920 would not be ready for harvest until in the last month of 1921 and the early part of 1922. It is also fully established that the crop of 1920-1921 on the land in question was a ratoon crop (sprout or second growth). The defendant therefor contends that this crop was not a complete crop and therefore not the kind of crop referred to in the contract of lease; that the first complete crop was that planted by him immediately after the execution of the contract in the fall of 1920 and which was harvested in 1921-1922; and that he therefore should not be required to pay rent for the agricultural year which embraces the crop of 1920.

We agree with the trial court that the defendant's position is untenable. As stated, if his interpretation of the contract were adopted, the plaintiff would receive no rent for the agricultural year 1920-1921 and we cannot assume that she would have paid the taxes on the property for that year and still have allowed the defendant to use the land, including machinery, tools, work animals, etc., and to carry off the crop without any compensation whatever to her.

It may well be conceded that the ratoon crop was not as valuable as a first crop after planting would have been, but the testimony of the plaintiff, as well as of the witnesses Montenegro, the defendant's original cotenant under the lease, shows that in the fall of 1920 the crop in question was estimated at from 2,000 to 3,000 piculs. The lower court also found as a fact that in the same year sugar sold at P45 per picul. The plaintiff's estimate of the yield is probably exaggerated; the defendant testifies to a much lower figure and the mill receipts presented by him in evidence indicate that the crop actually harvested amounted to 899.27 piculs, of which he was entitled to one-half and which was sold at only P16 per picul. But as against the plaintiff's estimate, it appears that after taking possession of the land he destroyed a large portion of the ratoon crop by constructing a road through the cane fields and by taking ratoons for seeds for another hacienda.

It is therefore safe to suppose that at the time of entering into the contract the parties had in mind prospects of a yield considerably greater than that actually obtained and that they did not at that time foresee the violent decline in the price of sugar. Taking into consideration that the ratoon crop did not involve any expense for planting and that it was ready for harvest within a few months after the execution of the contract, we may reasonably conclude that the parties considered that the rental value of the property for the year 1920-1921 would easily amount to P8,000.

The fact that the defendant paid the plaintiff P4,000 in January, 1921, and another P4,000 in November of the same year, materially strengthens the plaintiff's contention. The defendant's explanation that these payments were advances on the rent for the year 1921-1922 is flatly contradicted by Exhibit E, a letter written by him to the plaintiff on August 7, 1921, and which reads as follows:

Sra. JOSEFINA R. VDA. DE LARENA,

MI APRECIABLE PINANG: No tengo inconveniente en pagar con el arriendo tu cta. con la Tabacalera como son los deseos pero debe ser de acuerdo con las fechas del vencimiento que hemos estipulado. Por ejemplo, yo pagare a la Compañia los 4,000 pesos que tengo que pagar por el arriendo correspondiente al mes de junio pasado, arriendo perteneciente al ano 1920 y 1921. Con respeto al arriendo que corresponde al ano 1922 yo pagare a la Compañia 4,000 pesos el plazo que corresponde al mes de noviembre proximo como pago del primer plazo del arriendo que pertenece a dicho ano 1922 y para junio de 1922 el ultimo pago del arriendo del mismo ano, y asi sucesivamente.

Solo espero tu aviso para escribar a la Tabacalera.

Dodong esta algo mejor pero es una enfermedad cuya curacion es lenta.

Ascion y yo le enviamos nuestros afectos.

(Sgd.) "BINDOY"

Considering further the admitted fact that the lease was prepared by the defendant, or under his direction, and therefore must be construed in favor of the plaintiff, there can be no question but that the judgment appealed from is entirely in conformity with the law and the established facts.

Said judgment is therefor affirmed, with the costs against the appellant. So ordered.

Araullo, C.J., Street, Avanceña, Johns and Romualdez, JJ., concur.

SECOND DIVISION

[G.R. No. 32958. November 8, 1930. ]

BLOSSOM & COMPANY, INC., Plaintiff-Appellant, v. MANILA GAS CORPORATION, Defendant-Appellee.

Harvey & O’Brien for Appellant.

Ross, Lawrence & Selph and John B. Miller for Appellee.

SYLLABUS

1. WHEN FORMER JUDGMENT IS A BAR. — In its compliant of March 3, 1927, plaintiff seeks to recover damages accrued since November 23, 1923, for a willful breach of a contract for the sale and delivery of water gas and coal gas tar at stipulated prices, and for answer defendant alleges that in the former action in the Court of First Instance of the City of Manila, in which plaintiff here was the plaintiff, and the defendant here was the defendant, and founded upon the same cause of action alleged in the complaint that plaintiff recovered judgment against the defendant on the merits, decreeing a breach of the same contract and awarding damages in favor of the plaintiff in the sum of P26,119.08 with legal interest from November 23, 1923, which judgment became and is now final. Held, That the judgment which the plaintiff obtained in the former action founded upon a breach of the same contract is a bar to this action.

2. ONLY ONE CAUSE OF ACTION WHEN CONTRACT IS ENTIRE. — As a general rule, a contract to do several things at several times is divisible, and a judgment for a single breach of a continuing contract is not a bar to a suit for a subsequent breach. But where the contract is entire, and the breach total, there can be only one action in which plaintiff must recover all damages.

3. WHEN CONTRACT IS INDIVISIBLE. — When the defendant terminated a continuing contract by absolute refusal in bad faith to perform, a claim for damages for a breach is an indivisible demand, and where, as in this case, a former final judgment was rendered, it is a bar to any damages which plaintiff may thereafter sustain.

4. WHAT PLAINTIFF SHOULD PROVE. — In an indivisible contract plaintiff should prove in the first action not only such damages as it has then actually sustained, but also such prospective damages as it may be legally entitled to recover by reason of the breach.

STATEMENT

In its complaint filed March 3, 1927, the plaintiff alleges that on September 10, 1918, it entered into a contract with the defendant in which the plaintiff promised and undertook to purchase and receive from the defendant, and the defendant agreed to sell and deliver to the plaintiff, for a period of four years, three tons of water gas tar per month from September to January 1, 1919, and twenty tons per month after January 1, 1919, for the remaining period of the contract; one-half ton of coal gas tar a month from September to January 1, 1919, and six tons per month after January 1, 1919, for the remainder of the contract, delivery to be made at the plant of the defendant in the City of Manila, without containers, and at the price of P65 per ton for each kind of gas tar, it being agreed that this price should prevail only so long as the raw materials — coal and crude oil — used by the defendant in the manufacture of gas should cost the defendant the same price as that prevailing at the time of the contract, and that in the event of an increase or decrease in the cost of raw materials, there would be a corresponding increase or decrease in the price of the tar. That on January 31, 1919, this contract was amended so that it should continue to remain in

force for a period of ten years from January 1, 1919, and it was agreed that the plaintiff should not be obliged to take the quantities of the tars required during the year 1919, but that it might purchase tars in such quantities as it could use to advantage at the stipulated price. That after the year 1919, the plaintiff would take at least the quantities specified in the contract of September 10, 1918, to be taken from and after January 1, 1919, and that at its option it would have the right to take any quantity of water gas tar in excess of the minimum quantity specified in that contract, and up to the total amount of output of that tar of defendant’s plant, and also to take any quantity of coal gas tar in excess of the minimum quantity specified in that contract and up to 50 per cent of defendant’s entire output of coal gas tar, and that by giving the defendant ninety days’ notice, it would have the right at its option to take the entire output of defendant’s coal gas tar, except such as it might need for its own use in and about its plant. That in consideration of this modification of the contract of September 10, 1918, plaintiff agreed to purchase from the defendant a certain piece of land lying adjacent to its plant at the price of P5 per square meter, and proof of which is evidenced by Exhibit C. That pursuant to Exhibit C, defendant sold and conveyed the land to the plaintiff which in turn executed a mortgage thereon to the defendant for P17,140.20, to secure the payment of the balance of the purchase price.

It is then alleged:jgc:chanrobles.com.ph

"VIII. That about the last part of July, 1920, the defendant herein, the Manila Gas Corporation, willfully and deliberately breached its said contract, Exhibit C, with the plaintiff by ceasing to deliver any coal and water gas tar to it thereunder solely because of the increased price of its tar products and its desire to secure better prices therefor than plaintiff was obligated to pay to it, notwithstanding the frequent and urgent demands made by the plaintiff upon it to comply with its aforesaid contract by continuing to deliver the coal and water gas tar to the plaintiff thereunder, but the said contract, and finally on November 23, 1923, the plaintiff was forced to commence action against the defendant herein in the Court of First Instance of Manila, being case No. 25352, of that court, entitled ’Blossom & Co., Plaintiff, v. Manila Gas Corporation, defendant,’ to recover the damages which it had up to that time suffered by reason of such flagrant violation of said contract on the part of the defendant herein, and to obtain the specific performance of the said contract, and after due trial of that action, judgment was entered therein in favor of the plaintiff herein and against the said defendant, the Manila Gas Corporation, for the sum of P26,119.08, as the damages suffered by this plaintiff by the defendant’s breach of said contract from July, 1920, up to and including September, 1923, with legal interest thereon from November 23, 1923, and for the costs but the court refused to order the said defendant to resume the delivery of the coal and water gas tar to the plaintiff under said contract, but left the plaintiff with its remedy for damages against said defendant for the subsequent breaches of said contract, which said decision, as shown by the copy attached hereto as Exhibit G, and made a part hereof, was affirmed by our Supreme Court on March 3, 1926;

"IX. That after the defendant had willfully and deliberately violated its said contract, as herein-before alleged, and the plaintiff had suffered great damage by reason thereof, the plaintiff claimed the right to off-set its damages against the balance due from it to said defendant on account of the purchase of said land from the defendant, and immediately thereupon and notwithstanding said defendant was justly indebted to the plaintiff at that time, as shown by the judgment of the court, Exhibit G, in more than four times the amount due to it from the plaintiff, the said defendant caused to be presented against the plaintiff a foreclosure action, known as the Manila Gas Corporation versus Blossom & Company, No. 24267, of the Court of First Instance of Manila, and obtained judgment therein ordering that Blossom & Company pay the last installment and interest due on said land or else the land and improvements placed thereon by the plaintiff would be sold, as provided by law in such cases of satisfy the same, and the said defendant proceeded with the sale of said property under said judgment and did everything in its power to sell the same for the sole purpose of crushing and destroying the plaintiff’s business and thus rendering it impossible for the plaintiff herein to continue with its said contract in the event that said defendant might in the future consider it more profitable to resume performance of the same, but fortunately the plaintiff was able to redeem its property, as well as to comply with its contract, and continued demanding that the defendant performed its said contract and deliver to it the coal and water gas tar required thereby."cralaw virtua1aw library

That the defendant made no deliveries under its contract, Exhibit C, from July, 1920, to March 26, 1926, or until after the Supreme Court affirmed the judgment of the lower court for damages in the sum of P26,119.08. 1

It is then alleged that:jgc:chanrobles.com.ph

". . . On March 26, 1926, the said defendant offered to resume delivery to the plaintiff from that date of the minimum monthly quantities of tars stated in its contract, and the plaintiff believing that the said defendant was at least going to try to act in good faith in the further performance of its said contract, commenced to accept deliveries of said tars from it, and at once ascertained that the said defendant was deliberately charging it prices much higher than the contract price, and while the plaintiff accepted deliveries of the minimum quantities of tars stated in said contract up to and including January, 1927, (although it had demanded deliveries of larger quantities thereunder, as hereinafter alleged) and paid the increased prices demanded by the defendant, in the belief that it was its duty to minimize the damages as much as possible which the defendant would be required to pay to it by reason of its violation of said contract, it has in all cases done so under protest and with the express reservation of the right to demand from the said defendant an adjustment of the prices charged in violation of its contract, and the right to the payment of the losses which it had and would suffer by reason of its refusal to make additional deliveries under said contract, and it also has continuously demanded that the said defendant furnish to it statements supported by its invoices, showing the cost prices of its raw materials — coal and crude oil — upon which the contract price of the tars in question is fixed, which is the only way the plaintiff has to calculate the true price of said tars, but said defendant has and still refuses to furnish such information, and will continue to refuse to do so, unless ordered to furnish such information to the plaintiff by the court, and the plaintiff believes from the information which it now has and so alleges that the said defendant has overcharged it on the deliveries of said tars mentioned in the sum of at least P10,000, all in violation of the rights of the plaintiff under its said contract with the defendant."cralaw virtua1aw library

That on January 31, 1926, and pursuant to Exhibit C, plaintiff notified the defendant in writing that commencing with the month of August, 1926, it desired to take delivery of 50 per cent of defendant’s coal tar production for that month, and that on November 1, 1926, it desired to take the entire output of defendant’s coal gas tar, but that the defendant refused and still refuses to make such deliveries, unless plaintiff would take all of its water gas tar production with the desired quantity of coal gas tar, which refusal was a plain violation of the contract. That on January 29, 1927, and in accord with Exhibit C, plaintiff notified the defendant in writing that within ninety days after the initial delivery to it of its total coal gas tar production, or in February, 1927, it would require 50 per cent of its total water gas tar production, and that in April, 1927, it would require the total output of the defendant of both coal and water gas tars, and that it refused to make either of such deliveries.

It is then alleged:jgc:chanrobles.com.ph

"XIV. That as shown by the foregoing allegations of this complaint, it is apparent that notwithstanding the plaintiff in this case has at all times faithfully performed all the terms and conditions of said contract, Exhibit C, on its part to be performed, and has at all times and is now ready, able and willing to accept and pay for the deliveries of said coal and water gas tar required by said contract and the notices given pursuant thereto, the said defendant, the Manila Gas Corporation, does not intent to comply with its said contract, Exhibit C, and deliver to the plaintiff at the times and under the terms and conditions stated therein the quantities of coal and water gas tars required by said contract, and the several notices given pursuant thereto, and that it is useless for the plaintiff to insist further upon its performance of the said contract, and for that reason the only feasible course for the plaintiff to pursue is to ask the court for the rescission of said contract and for the full damages which the plaintiff has suffered from September, 1923, and will suffer for the remainder of said contract by reason of the defendant’s failure and refusal to perform the same, and the plaintiff has no notified the said defendant."cralaw virtua1aw library

That since September, 1923, by reason of the bad faith of the defendant, the plaintiff has been damages in the sum of P300,000, for which it prays a corresponding judgment, and that the contract, Exhibit C, be rescinded and declared void and without force and effect.

After the filing and overruling of its demurrer, the defendant filed an answer in the nature of a general and specific denial, and on April 10, 1928, and upon stipulation of the parties, the court appointed W. W. Larkin referee, "to take the evidence and, upon completion of the trial, to report his findings of law and fact to the court."cralaw virtua1aw library

July 18, 1928, the defendant filed an amended answer in which it alleged as an affirmative defense, first, that the complaint does not state facts sufficient to constitute a cause of action for the reason that a prior adjudication has been had of all the issues involved in this action, and, second, "that on or about the 16th day of June, 1925, in an action brought in the Court of First

Instance of the City of Manila, Philippine Islands, before the Honorable Geo. R. Harvey, Judge, by Blossom & Company, Plaintiff, v. Manila Gas Corporation, defendant, being civil case No. 25352, of said court, for the same cause of action as that set forth in the complaint herein, said plaintiff recovered judgment upon the merits thereof, against said defendant, decreeing a breach of the contract sued upon herein, and awarding damages therefor in the sum of P26, 119.08 with legal interest from November 23, 1923, and costs of suit, which judgment was upon appeal affirmed by the Supreme Court of the Philippine Islands, in case G.R. No. 24777 of said court, on the 3d day of March, 1926, and reported in volume 48 Philippine Reports at page 848," and it prays that plaintiff’s complaint be dismissed, with costs.

After the evidence was taken, the referee made an exhaustive report of sixty-six pages in which he found that the plaintiff was entitled to P56,901.53 damages, with legal interest from the date of filing of the complaint, to which both parties filed numerous exceptions.

In its decision the court says:jgc:chanrobles.com.ph

"Incidental references have been made to the referee’s report. It was admirably prepared. Leaving aside the question of damages and the facts upon which the referee assessed them, the facts are not in dispute — at least not in serious dispute. They appear in the documentary evidence and this decision is based upon documents introduced into evidence by plaintiff. If I could have agreed with the referee in respect to the question of law, I should have approved his report in toto. If defendant is liable for the damages accruing from November 23, 1923, the date the first complaint was filed, to April 1st, 1926, the date of resumption of relations; and if defendant, after such resumption of relations, again violated the contract, the damages assessed by the referee, are, to my way of thinking, as fair as could be estimated. He went to tremendous pains in figuring out the details upon which he based his decision. Unfortunately, I cannot agree with his legal conclusions and the report is set aside except wherein specifically approved.

"It is unnecessary to resolve specifically the many exceptions made by both parties to the referee’s report. It would take much time to do so. Much time has already been spent in preparing this decision. Since both parties have informed me that in case of adverse judgment, an appeal would be taken, I desire to conclude the case so that delay will be avoided.

"Let judgment be entered awarding damages to plaintiff in the sum of P2,219.60, with costs."cralaw virtua1aw library

From which plaintiff only appealed and assigns twenty-four different errors, of which the following are material to this opinion:jgc:chanrobles.com.ph

"I. The trial court erred in holding that this suit is so far as the damages from November, 1923, to March 31, 1926, are concerned, is res adjudicata.

"II. The trial court erred in holding that the defendant repudiated the contract in question as a whole, and that the plaintiff when it brought its first suit to collect damages had already elected and consented to the dissolution of the contract, and its choice once made, being final, it was estopped to claim that the contract was alive when that suit was brought.

x x x

"VII. The trial court erred in refusing to sustain plaintiff’s third exception to the legal interpretation placed on the contract in this case by the referee with reference to quantity of tars and his conclusion with respect to the terms thereof that:jgc:chanrobles.com.ph

"‘1. Plaintiff must take and defendant must deliver either the minimum or maximum quantity of water gas tar and not any quantity from the minimum to the maximum and/or

"‘2. Plaintiff must take either the minimum and any quantity up to fifty per cent of entire output of coal gas tar.

"‘3. With ninety days’ notice by plaintiff to defendant the former must take and the latter must deliver total output of both tars, except such as might be needed by defendant for use in and about its plant and not any quantity from the minimum up to total output of both tars.’ (See page 47, Referee’s report.)

"And in holding that the option contained in said contract, taking into consideration the purpose of both parties in entering into the contract, was as claimed by defendant: all the water gas tar and 50 per cent of the coal gas tar upon immediate notice, and all tars upon ninety days’ notice.

"VIII. The trial court erred in refusing to sustain plaintiff’s fourth exception to the finding and conclusion of the referee that from the correspondence between the parties, it was apparent that plaintiff did not make a right use of its option, and that the letter of June 25, 1926, and the subsequent demands, with exception of the letter of July 31, 1926, were not made in pursuance to the terms of the contract, and that defendant had no liability in refusing to comply therewith, and in allowing plaintiff damages only for the failure of the defendant to deliver quantities shown in Exhibits Ref. 21 and 22. (See pages 51, 52, Referee’s report.)

"IX. The trial court erred in finding and holding that the demands of plaintiff for additional tars under its contract with the defendant were extravagant and not made in good faith, and that when it wrote to defendant that it desired maximum quantities of coal gas tars and only minimum of water gas tars, but with the reservation of going back to minimum quantities of both at any time it chose, it announced its intention of breaching the contract, the defendant was under no obligation to deliver maximum quantities of either tars, and since this was the efficient cause of the failure of defendant to deliver or plaintiff to accept tars, the blame is attributable to plaintiff, and it cannot recover for a rescission.

x x x

"XXIII. The trial court erred in refusing to sustain plaintiff’s seventeenth exception to the finding and conclusion of the referee that the plaintiff is entitled to recover from the defendant only the following sums:chanrob1es virtual 1aw library

Water gas tar (Exhibit Ref. 21) P 38,134.60

Coal gas tar (Exhibit Ref. 22) 16,547.33

Overcharges on deliveries (Exhibit Ref. 23) 2,219.60

__________

or a total of 56,901.53

with interest, and in not awarding to the plaintiff as damages in this case the sum of P319,253.40, with legal interest thereon from the date of filing the complaint in this case, in the manner and form computed by it, and in awarding damages to the plaintiff for the sum of only P2,219.60, with costs."cralaw virtua1aw library

x x x

D E C I S I O N

JOHNS, J.:

In this action plaintiff seeks to recover damages from the defendant which it claims to have sustained after September, 1923, arising from, and growing out of, its original contract of September 10, 1918, as modified on January 1, 1919, to continue for a period of ten years from that date.

In paragraph VIII of its complaint, plaintiff alleges that about the last part of July, 1920, the defendant "willfully and deliberately breached its said contract," and that it "flatly refused to make any deliveries under said contract, and finally on November 23, 1923," it was force to commence action in the Court of First Instance against the defendant, known as case No. 25352, to recover the damages which it had then sustained by reason of such flagrant violation of said contract on the part of the defendant, in which judgment was rendered in favor of the plaintiff and against the defendant for P26,119.08, as damages "suffered by his plaintiff by the defendant’s breach of said contract from July, 1920, up to and including September, 1923, with legal interest thereon from November 23, 1923, and for the costs," in which the court refused to order the defendant to resume the delivery of the coal and water gas tar to the plaintiff, in accord with said contract, but left it with its remedy for damages against the defendant for any subsequent breaches of the contract. A copy of that judgment, which was later affirmed by this court, at attached to, marked Exhibit G, and made a part of, the complaint in this action.

In their respective briefs, opposing counsel have much to say about the purpose and intent of that judgment, and it is vigorously asserted that it was never intended that it should be or become a bar to another action by the plaintiff to recover any damages it may have sustained after September, 1923, during the remainder of the ten-year period of that contract. Be that as it may, it must be conceded that the question as to what would

be the legal force and effect of that judgment in that case was never presented to, or decided by, the lower court or this court. In the very nature of things, neither court in that case would have the power to pass upon or decide the legal force and effect of its own judgment, for the simple reason that it would be premature and outside of the issues of any pleading, and could not be raised or presented until after the judgment became final, and then only by an appropriate plea, as in this case.

Plaintiff specifically alleges that the the defendant willfully and deliberately breached the contract, and "flatly refused to make any deliveries under said contract," by reason of which it was forced to and commenced its former action in which it was awarded P26,119.08 damages against the defendant by reason of its breach of the contract from July, 1920, to September, 1923.

In the final analysis, plaintiff in this action seeks to recover damages growing out of, and arising from, other and different breaches of that same contract after November, 1923, for the remainder of the ten-year period, and the question is thus squarely presented as to whether the rendition of the former judgment is a bar to the right of the plaintiff to recover damages from the after September, 1923, arising from, and growing out of, breaches of the original contract of September 10, 1918, as modified on January 1, 1919. That is to say, whether the plaintiff, in a former action, having recovered judgment for the damages which it sustained by reason of a breach of its contract by the defendant up to September, 1923, can now in this action recover damages it may have sustained in this action recover damages it may have sustained after September, 1923, arising from, and growing out of, a breach of the same contract, upon and for which it recovered its judgment in the former action.

In the former action in which the judgment was rendered, it is alleged in the complaint:jgc:chanrobles.com.ph

"‘7. That about the last part of July or the first part of August, 1920, the Manila Gas Corporation, the defendant herein, without any cause ceased delivering coal and water gas tar to the plaintiff herein; and that from that time up to the present date, the plaintiff corporation, Blossom & Company, has frequently and urgently demanded of the defendant, the Manila Gas Corporation, that it comply with its aforesaid contract Exhibit A by continuing to deliver coal and water gas tar to this plaintiff - but that the said defendant has refused, and still refused, to deliver to the plaintiff any coal and water gas tar whatsoever under the said contract Exhibit A, since the said month of July, 1920.

x x x

"‘9. That owing to the bad faith of the said Manila Gas Corporation, defendant herein, in not living up to its said contract Exhibit A, made with this plaintiff, and refusing now to carry out the terms of the same, by delivering to this plaintiff the coal and water gas tar mentioned in the said Exhibit A, has caused to this plaintiff great and irreparable damages amounting to the sum total of one hundred twenty-four thousand eight hundred forty-eight pesos and seventy centavos (P124,848.70); and that the said defendant corporation has refused, and still refuses, to pay to this plaintiff the whole or any part of the aforesaid sum.

"‘10. That the said contract Exhibit A, was to be in force until January 1, 1929, that it to say, for ten (10) years counted from January 1, 1919; and that, unless the defendant again commence to furnish and supply this plaintiff with coal and water gas tar, as provided for in the said contract Exhibit A, the damages already suffered by this plaintiff will continually increase and become larger and larger in the course of years preceding the termination of the said contract on January 1, 1929.’"

In that action plaintiff prays for judgment against the defendant:jgc:chanrobles.com.ph

"‘(a) That upon trial of this cause judgment be rendered in favor of the plaintiff and against the defendant for the sum of P124,848.70, with legal interests thereon from November 23, 1923;

"‘(b) That the court specifically order the defendant to resume the delivery of the coal and water gas tar to the plaintiff under the terms of the said contract Exhibit A of this complaint.’"

In the final analysis, plaintiff must stand or fall on its own pleadings, and tested by that rule, it must be admitted that the plaintiff’s original cause of action, in which it recovered judgment for damages, was founded on the ten-year contract, and that the damages which it then recovered were recovered for a breach of that contract.

Both actions are founded on one and the same contract. By the

terms of the original contract of September 10, 1918, the defendant was to sell and the plaintiff was to purchase three tons of water gas tar per month from September to January 1, 1919, and twenty tons of water gas tar per after from January 1, 1919, one-half ton of coal gas tar per month from September to January 1, 1919, and six tons of coal gas tar per month after January 1, 1919. That from and after January 1, 1919, plaintiff would take at least the quantities specified in the contract of September 10, 1918, and that at its option, it would have the right to take the total output of water gas tar of defendant’s plant and 50 per cent of the gross output of its coal gas tar, and upon giving ninety days’ notice, it would have the right to the entire output of coal gas tar, except such as the defendant might need for its own use. That is to say, the contract provided for the delivery to the plaintiff from month to month of the specified amounts of the different tars as ordered and requested by the plaintiff. In other words, under plaintiff’s own theory, the defendant was to make deliveries from month to month of the tars during the period of ten years, and it is alleged in both complaints that the defendant broke its contract, and in bad faith refused to make any more deliveries.

In 34 Corpus Juris, p. 839, it is said:jgc:chanrobles.com.ph

"As a general rule a contract to do several things at several times is divisible in its nature, so as to authorize successive actions; and a judgment recovered for a single breach of a continuing contract or covenant is no bar to a suit for a subsequent breach thereof. But where the covenant or contract is entire, and the breach total, there can be only action, and the plaintiff must therein recover all his damages."cralaw virtua1aw library

In the case of Roehm v. Horst, 178 U.S., 1; 44 Law. ed., 953, that court said:jgc:chanrobles.com.ph

"An unqualified and positive refusal to perform a contract, though the performance thereof is not yet due, may, if the renunciation goes to the whole contract, be treated as a complete breach which will entitled the injured party to bring his action at once."cralaw virtua1aw library

15 Ruling Case Law, 966, 967, sec. 441, says:jgc:chanrobles.com.ph

"Similarly if there is a breach by the vendor of a contract for the sale of goods to be delivered and paid for in installments, and the vendee maintains an action therefor and recovers damages, he cannot maintain a subsequent action to recover for the failure to deliver later installments."cralaw virtua1aw library

In Pakas v. Hollingshead, 184 N. Y., 211; 77 N. E., 40; 3 L. R. A. (N.S.) , 1042, the syllabus says:jgc:chanrobles.com.ph

"Upon refusal, by the seller, after partial performance, longer to comply with his contract to sell and deliver a quantity of articles in installments, the buyer cannot keep the contract in force and maintain actions for breaches as they occur, but must recover all his damages in one suit."cralaw virtua1aw library

And on page 1044 of its opinion, the court says:jgc:chanrobles.com.ph

"The learned counsel for the plaintiff contends that the former judgment did not constitute a bar to the present action, but that the plaintiff had the right to elect to waive or disregard the breach, keep the contract in force, and maintain successive actions for damages from time to time as the installments of goods were to be delivered, however numerous these actions for damages from time to time as the installments of goods were to be delivered, however numerous these actions might be. It is said that this contention is supported in reason and justice, and has the sanction of authority at least in other jurisdictions. We do not think that the contention can be maintained. There is not, as it seems to us, any judicial authority in this state that gives it any substantial support. On the contrary, we think that the cases, so far as we have been able to examine them, are all the other way, and are to the effect that, inasmuch as there was a total breach of the contract by the defendant’s refusal to deliver, the plaintiff cannot split up his demand and maintain successive actions, but must either recover all his damages in the first suit or wait until the contract matured or the time for the delivery of all the goods had arrived. In other words, there can be but one action for damages for a total breach of an entire contract to deliver goods, and the fact that they were to be delivered in installment from time to time does not change the general rule."cralaw virtua1aw library

The case of L. Bucki & Son Lumber Co. v. Atlantic Lumber Co. (109 Federal, 411), of the United States Circuit Court of Appeals for the Fifth Circuit, is very similar.

The syllabus says:jgc:chanrobles.com.ph

"1. CONTRACTS — CONSTRUCTION — ENTIRE CONTRACT. — A contract was made for the sale of a large quantity of logs to be delivered in monthly installments during a period of eight years, payments to be made also in installments at times having relations to the deliveries. It contained stipulations as to such payments, and guaranties as to the average size of the logs to be delivered in each installment. Held, that it was an entire contract, and not a number of separate and independent agreements for the sale of the quantity to be delivered and paid for each month, although there might be breaches of the minor stipulations and warranties with reference thereto which would warrant suits without a termination of the contract.

"2. JUDGMENTS — MATTERS CONCLUDED — ACTION FOR BREACH OF INDIVISIBLE CONTRACT. — The seller declared the contract terminated for alleged breaches by the purchaser, and brought suit for general and special damages, the latter covering payments due for installment of logs delivered. By way of set-off and recoupment against this demand, the purchaser pleaded breaches of the warranty as to the size of the logs delivered during the months for which payment has not been made. Held, that the judgment is such action was conclusive as to all claims or demands of either party against the other growing out of the entire contract, and was a bar to a subsequent suit brought by the purchaser to recover for other breaches of the same warranty in relation to deliveries made in previous months."cralaw virtua1aw library

On page 415 of the opinion, the court says:jgc:chanrobles.com.ph

"When the contract was ended, the claims of each party for alleged breaches and damages therefor constituted an indivisible demand; and when the same, or any part of the same, was pleaded, litigation had, and final judgment rendered, such suit and judgment constitute a bar to subsequent demands which were or might have been litigated. (Baird v. U.S., 96 U.S., 430; 24 L. ed., 703.)"

In Watts v. Weston (238 Federal, 149), Circuit Court of Appeals, Second Circuit, the syllabus says:jgc:chanrobles.com.ph

"1. JUDGMENT — 593 — JUDGMENT AS BAR — MATTERS CONCLUDED. — Where a continuing contract was terminated by the absolute refusal of the party whose action was necessary to further perform, a claim for damages on account of the breach constituted an indivisible demand, and when the same of any part of the same was pleaded, litigated, and final judgment rendered, such suit and judgment constitute a bar to subsequent demands which were or might have been litigated therein."cralaw virtua1aw library

And on page 150 of the opinion, the court says:jgc:chanrobles.com.ph

"It is enough to show the lack of merit in the present contention to point out as an inexorable rule of law that, when Knevals’ contract was discharged by his total repudiation thereof, Watts’ claims for breaches and damages therefor ’constituted an indivisible demand, and when the same, or any part of the same, was pleaded, litigation had and final judgment rendered, such suit and judgment constitute a bar to subsequent demands which were or might have been litigated.’ (Bucki, etc., Co. v. Atlantic, etc., Co., 109 Fed. at page 415; 48 C. C. A., 459; Cf. Landon v. Bulkley, 95 Fed., 344; 37 C. C. A., 96.)

"The rule is usually applied in cases of alleged or supposed successive breaches, and consequently severable demands for damages; but if the contract has been discharged by breach, if suit for damages is all that is left, the rule is applicable, and every demand arising from that contract and possessed by any given plaintiff must be presented (at least as against any given defendant) in one action; what the plaintiff does not advance he foregoes by conclusive presumption."cralaw virtua1aw library

In Abbott v. 76 Land and Water Co. (118 Pac., 425; 161 Cal., 42), at page 428, the court said:jgc:chanrobles.com.ph

"In Fish v. Folley, 6 Hill (N.Y.) , 54, it was held, in accord with the rule we have discussed, that, where the defendant had covenanted that plaintiff should have a continual supply of water for his mill from a dam, and subsequently totally failed to perform for nine years, and plaintiff brought an action for the breach and recovered damages sustained by him to that time, the judgment was a bar to a second action arising from subsequent failure to perform, on the theory that, although the covenant was a continuing one in one sense, it was an entire contract, and a total breach put an end to it, and gave plaintiff the right to sue for an equivalent in damages.

"In such a case it is no warrant for a second action that the party may not be able to actually prove in the first action all the items of the demand, or that all the damage may not then have been actually suffered. He is bound to prove in the first action not only

such damage as has been actually suffered, but also such prospective damage by reason of the breach as he may be legally entitled to, for the judgment he recovers in such action will be a conclusive adjudication as to the total damage on account of the breach."cralaw virtua1aw library

It will thus be seen that, where there is a complete and total breach of a continuous contract for a term of years, the recovery of a judgment for damages by reason of the breach is a bar to another action on the same contract for and on account of the continuous breach.

In the final analysis, there is no real dispute about any material fact, and the important and decisive question is the legal construction of the pleadings in the former case and in this case, and of the contract between the plaintiff and the defendant of January 1, 1920.

The complaint in the former case specifically alleges that the defendant "has refused, and still refuses, to deliver to the plaintiff any coal and water gas tar whatsoever under the said contract Exhibit A, since the said month of July, 1920." "That owing to the bad faith of the said Manila Gas Corporation, defendant herein, in not living up to its said contract Exhibit A, made with this plaintiff, and refusing now to carry out the terms of the same." That is a specific allegation not only of a breach of the contract since the month of July, 1920, but of the bad faith of the defendant in its continuous refusal to make deliveries of any coal and water gas tar. That amended complaint was filed on July 11, 1924, or four years after the alleged bad faith in breaking the contract.

Having recovered damages against it, covering a period of four years, upon the theory that the defendant broke the contract, and in bad faith refused to make deliveries of either of the tars, how can the plaintiff now claim and assert that the contract is still in force and effect? In the instant case the plaintiff alleges and relies upon the ten-year contract of January 1, 1920, which in bad faith was broken by the defendant. If the contract was then broken, how can it be enforced in this action?

It is admitted that the defendant never made any deliveries of any tar from July, 1920, to April, 1926. Also that it made nine deliveries to plaintiff of the minimum quantities of coal and water gas tar from April 7, 1926, to January 5, 1927.

Plaintiff contends that such deliveries were made under and in continuation of the old contract.

March 26, 1926, after the decision of this court affirming the judgment in the original action, plaintiff wrote the defendant;

". . . It is our desire to take deliveries of at least the minimum quantities set forth therein and shall appreciate to have you advise us how soon you will be in a position to make deliveries; . . .

". . . In view of the fact that you have only effected settlement up to November 23, 1923, please inform us what adjustment you are willing to make for the period of time that has since elapsed without your complying with the contract."cralaw virtua1aw library

In response to which on March 31, 1926, the defendant wrote this letter to the plaintiff:jgc:chanrobles.com.ph

"In reply to your letter of March 26th, 1926, in regard to tar, we beg to advise you that we are prepared to furnish the minimum quantities of coal and water gas tars as per your letter, viz: twenty tons of water gas tar and six tons of coal gas tar. The price figured on present costs of raw materials is P39.01 (Thirty-nine and 01/100 Pesos) per ton of water gas and P33.59 (Thirty-three and 59/100 Pesos) per ton of coal tar.

"We shall expect you to take delivery and pay for the above amount of tars at our factory on or before April 7th prox.

"Thereafter we shall be ready to furnish equal amounts on the first of each month. Kindly make your arrangements accordingly."cralaw virtua1aw library

On January 29, 1927, the plaintiff wrote the defendant that:jgc:chanrobles.com.ph

"On July 31st last, we made demand upon you, under the terms of our tar contract, for 50 per cent of your total coal tar production for that month and also served notice on you that beginning 90 days from August 1st we would require your total output of coal tar monthly; this in addition to the 20 tons of water gas tar provided for in the contract to be taken monthly.

x x x

"We are here again calling on you for your total output of coal tar immediately and the regular minimum monthly quantity of water gas tar. In this connection we desire to advise you that within 90 days of your initial delivery to us to your total coal tar output we will require 50 per cent of your total water gas tar output, and, further, that two months thereafter we will require your total output of both tars."cralaw virtua1aw library

February 2, 1927, the defendant wrote the plaintiff:jgc:chanrobles.com.ph

"Replying to your letter of Jan. 29, we would say that we have already returned to you the check enclosed therewith. As we have repeatedly informed you we disagree with you as to the construction of your contract and insist that you take the whole output of both tars if you wish to secure the whole of the coal tar.

"With regard to your threat of further suits we presume that you will act as advised. If you make it necessary we shall do the same."cralaw virtua1aw library

From an analysis of these letters if clearly appears that the plaintiff then sought to rely upon and enforce the contract of January 1, 1920, and that defendant denied plaintiff’s construction of the contract, and insisted "that you take the whole output of both tars if you wish to secure the whole of the coal tar."cralaw virtua1aw library

February 28, 1927, the plaintiff wrote the defendant:jgc:chanrobles.com.ph

"In view of your numerous violations of and repeated refusal and failure to comply with the terms and provisions of our contract dated January 30-31, 1919, for the delivery to us of water and coal gas tars, etc., we will commence action," which it did.

The record tends to show that the tars which the defendant delivered after April 7, 1926, were not delivered under the old contract of January 1, 1920, and that at all times since July, 1920, the defendant has consistently refused to make any deliveries of any tars under that contract.

The referee found as a fact that plaintiff was entitled to P2,219.60 for and on account of overcharges which the defendant made for the deliveries of fifty-four tons of coal gar tar, and one hundred eighty tons of water gas tar after April, 1926, and upon that point the lower court says:jgc:chanrobles.com.ph

"The fourth charge that plaintiff makes is meritorious. The price was to be fixed on the basis of raw materials. The charge for deliveries during 1926 were too high. In this I agree with entirely with the referee and adopt his findings of fact and calculations. (See Referee’s report, p. 83). The referee awarded for overcharge during the period aforesaid, the sum of P2,219.60. The defendant was trying to discourage plaintiff from buying tars and made the price of raw material appear as high as possible."cralaw virtua1aw library

That finding is sustained upon the theory that the defendant broke its contract which it made with the plaintiff for the sale and delivery of the tars on and after April, 1926.

After careful study of the many important questions presented on this appeal in the exhaustive brief of the appellant, we are clearly of the opinion that, as found by the lower court, the plea of res judicata must be sustained. The judgment of the lower court is affirmed.

It is so ordered, with costs against the Appellant.

Johnson, Street, Malcolm, Villamor, Ostrand, Romualdez and Villa-Real, JJ., concur.

SECOND DIVISION

[G.R. No. L-66620. September 24, 1986.]

REMEDIO V. FLORES, Petitioner, v. HON. JUDGE HEILIA S. MALLARE-PHILLIPPS, IGNACIO BINONGCAL & FERNANDO

CALION, Respondents.

Lucio A. Dixon for respondent F. Calion.

SYLLABUS

1. REMEDIAL LAW; BATAS PAMBANSA BLG. 129; SECTION 33(1) OF ITS INTERIM RULES; SUBJECT TO REQUIREMENTS FOR PERMISSIVE JOINDER OF PARTIES UNDER THE RULES OF COURT.

— The Court rules that the application of the totality rules under Section 33(1) of Batas Pambansa Blg. 129 and Section 11 of the Interim Rules is subject to the requirements for the permissive joinder of parties under Section 6 of Rule 3 which provides as follows: "Permissive joinder of parties. — All persons in whom or against whom any right to relief in respect to or arising out of the same transaction or series of transactions is alleged to exist, whether jointly, severally, or in the alternative, may, except as otherwise provided in these rules, join as plaintiffs or be joined as defendants in one complaint, where any question of law or fact common to all such plaintiffs or to all such defendants may arise in the action; but the court may make such orders as may be just to prevent any plaintiff or defendant from being embarrassed or put to expense in connection with any proceedings in which he may have no interest."cralaw virtua1aw library

2. ID.; ID.; SECTION 39 THEREOF; APPLICABLE ONLY TO ORDINARY APPEALS FROM REGULAR TRIAL COURT TO COURT OF APPEALS. — Petitioner did not attach to his petition a copy of his complaint in the erroneous belief that the entire original record of the case shall be transmitted to this Court pursuant to the second paragraph of Section 39 of BP 129. This provision applies only to ordinary appeals from the regional trial court to the Court of Appeals (Section 20 of the Interim Rules). Appeals to this Court by petition for review on certiorari are governed by Rule 45 of the Rules of Court (Section 25 of the Interim Rules).

3. ID.; ID.; SECTION 33(1) OF ITS INTERIM RULES; DISTINGUISHED FROM SECTION 88 OF JUDICIARY ACT OF 1948. — There is no difference between the former and present rules in cases where a plaintiff sues a defendant on two or more separate causes of action. In such cases, the amount of the demand shall be the totality of the claims in all the causes of action irrespective of whether the cause of action arose out of the same or different transactions. If the total demand exceeds twenty thousand pesos, then the regional trial court has jurisdiction. Needless to state, if the causes of action are separate and independent, their joinder in one complaint is permissive and not mandatory, and any cause of action where the amount of the demand is twenty thousand pesos or less may be the subject of a separate complaint filed with a metropolitan or municipal trial court.

4. ID.; ID.; ID.; ID. — There is a difference between the former and present rules in cases where two or more plaintiffs having separate causes of action against a defendant join in a single causes of action against a defendant join in a single complaint. Under the former rules, "where the claims or causes of action joined in a single complaint are separately owned by or due to different parties, each separate claim shall furnish the jurisdictional test" (Section 88 of the Judiciary Act of 1948 as amended, supra). This was based on the ruling in the case of Vda. de Rosario v. Justice of the Peace, 99 Phil. 693. As worded, the former ruled applied only to cases of permissive joinder or parties plaintiff. However, it was also applicable to cases of permissive joinder of parties defendant, as may be deduced from the ruling in the case of Brillo v. Buklatan, thus: "Furthermore, the first cause of action is composed of separate claims against several defendants of different amounts each of which is not more than P2,000 and falls under the jurisdiction of the justice of the peace court under Section 88 of Republic Act No. 296. The several claims do not seem to arise from the same transaction or series of transactions and there seem to be no questions of law or of fact common to all the defendants as may warrant their joinder under Rule 3, Section 6. Therefore, if new complaints are to be filed in the name of the real party in interest they should be filed in the justice of the peace court." (87 Phil. 519, 520, reiterated in Gacula v. Martinez, 88 Phil. 142, 146). Under the present law, the totality rule is applied also to cases where two or more plaintiffs having separate causes of action against a defendant join in a single complaint, as well as to cases where a plaintiff has separate causes of action against two or more defendants joined in a single complaint. However, the causes of action in favor of the two or more plaintiffs or against the two or more defendants should arise out of the same transaction or series of transactions and there should be a common question of law or fact, as provided in Section 6 of Rule 3.

5. ID.; ID.; ID.; ID. — The difference between the former and present rules in cases of permissive joinder of parties may be illustrated by the two cases which were cited in the case of Vda. de Rosario v. Justice of the Peace (supra) as exceptions to the totality rule. In the case of Soriano y Cia v. Jose (86 Phil. 523), where twenty-nine dismissed employees joined in a complaint against the defendant to collect their respective claims, each of which was within the jurisdiction of the municipal court, although the total exceeded the jurisdictional amount, this Court held that under the law then the municipal court had jurisdiction. In said case, although the plaintiff’s demands were separate, distinct and independent of one another, their joint suit was authorized under Section 6 of Rule 3 and each separate claim furnished the jurisdictional test. In the case of International Colleges, Inc. v. Argonza (90 Phil. 470), where twenty-five dismissed teachers jointly sued the defendant for unpaid salaries, this Court also

held that the municipal court had jurisdiction because the amount of each claim was within, although the total exceeded, its jurisdiction and it was a case of permissive joinder of parties plaintiff under Section 6 of Rule 3. Under the present law, the two cases above cited (Assuming they do not fall under the Labor Code) would be under the jurisdiction of the regional trial court). Similarly, in the above-cited cases of Brillo v. Buklatan and Gacula v. Martinez (supra), if the separate claims against the several defendants arose out of the same transaction or series of transactions and there is a common question of law or fact, they would now be under the jurisdiction of the regional trial court.

6. ID.; CIVIL PROCEDURE; PERMISSIVE JOINDER OF PARTIES; JURISDICTIONAL TESTS; HOW FURNISHED. — In cases of permissive joinder of parties, whether as plaintiffs or as defendants, under Section 6 of Rule 3, the total of all the claims shall now furnish the jurisdictional test. Needless to state also, if instead of joining or being joined in one complaint separate actions are filed by or against the parties, the amount demanded in each complaint shall furnish the jurisdictional test.

D E C I S I O N

FERIA, J.:

The Court rules that the application of the totality rule under Section 33(1) of Batas Pambansa Blg. 129 and Section 11 of the Interim Rules is subject to the requirements for the permissive joinder of parties under Section 6 of Rule 3 which provides as follows:jgc:chanrobles.com.ph

"Permissive joinder of parties, — All persons in whom or against whom any right to relief in respect to or arising out of the same transaction or series of transactions is alleged to exist, whether jointly, severally, or in the alternative, may, except as otherwise provided in these rules, join as plaintiffs or be joined as defendants in one complaint, where any question of law or fact common to all such plaintiffs or to all such defendants may arise in the action; but the court may make such orders as may be just to prevent any plaintiff or defendant from being embarrassed or put to expense in connection with any proceedings in which he may have no interest."cralaw virtua1aw library

Petitioner has appealed by certiorari from the order of Judge Heilia S. Mallare-Phillipps of the Regional Trial Court of Baguio City and Benguet Province which dismissed his complaint for lack of jurisdiction. Petitioner did not attach to his petition a copy of his complaint in the erroneous belief that the entire original record of the case shall be transmitted to this Court pursuant to the second paragraph of Section 39 of BP 129. This provision applies only to ordinary appeals from the regional trial court to the Court of Appeals (Section 20 of the Interim Rules). Appeals to this Court by petition for review on certiorari are governed by Rule 45 of the Rules of Court (Section 25 of the Interim Rules).

However, the order appealed from states that the first cause of action alleged in the complaint was against respondent Ignacio Binongcal for refusing to pay the amount of P11,643.00 representing cost of truck tires which he purchased on credit from petitioner on various occasions from August to October, 1981; and the second cause of action was against respondent Fernando Calion for allegedly refusing to pay the amount of P10,212.00 representing cost of truck tires which he purchased on credit from petitioner on several occasions from March, 1981 to January, 1982.chanrobles.com : virtual law library

On December 15, 1983, counsel for respondent Binongcal filed a Motion to Dismiss on the ground of lack of jurisdiction since the amount of the demand against said respondent was only P11,643.00, and under Section 19(8) of BP 129 the regional trial court shall exercise exclusive original jurisdiction if the amount of the demand is more than twenty thousand pesos (P20,000.00). It was further averred in said motion that although another person, Fernando Calion, was allegedly indebted to petitioner in the amount of P10,212.00, his obligation was separate and distinct from that of the other Respondent. At the hearing of said Motion to Dismiss, counsel for respondent Calion joined in moving for the dismissal of the complaint on the ground of lack of jurisdiction. Counsel for petitioner opposed the Motion to Dismiss. As above stated, the trial court dismissed the complaint for lack of jurisdiction.

Petitioner maintains that the lower court has jurisdiction over the case following the "novel" totality rule introduced in Section 33(1) of BP 129 and Section 11 of the Interim Rules.

The pertinent portion of Section 33(1) of BP 129 reads as follows:jgc:chanrobles.com.ph

". . . Provided, That where there are several claims or causes of

action between the same or different parties, embodied in the same complaint, the amount of the demand shall be the totality of the claims in all the causes of action, irrespective of whether the causes of action arose out of the same or different transactions . . ."cralaw virtua1aw library

Section 11 of the Interim Rules provides thus:jgc:chanrobles.com.ph

"Application of the totality rule. — In actions where the jurisdiction of the court is dependent on the amount involved, the test of jurisdiction shall be the aggregate sum of all the money demands, exclusive only of interest and costs, irrespective of whether or not the separate claims are owned by or due to different parties. If any demand is for damages in a civil action, the amount thereof must be specifically alleged."cralaw virtua1aw library

Petitioner compares the above-quoted provisions with the pertinent portion of the former rule under Section 88 of the Judiciary Act of 1948 as amended which reads as follows:chanrobles.com:cralaw:red

". . . Where there are several claims or causes of action between the same parties embodied in the same complaint, the amount of the demand shall be the totality of the demand in all the causes of action, irrespective of whether the causes of action arose out of the same or different transactions; but where the claims or causes of action joined in a single complaint are separately owned by or due to different parties, each separate claim shall furnish the jurisdictional test . . ."cralaw virtua1aw library

and argues that with the deletion of the proviso in the former rule, the totality rule was reduced to clarity and brevity and the jurisdictional test is the totality of the claims in all, not in each, of the causes of action, irrespective of whether the causes of action arose out of the same or different transactions.

This argument is partly correct. There is no difference between the former and present rules in cases where a plaintiff sues a defendant on two or more separate causes of action. In such cases, the amount of the demand shall be the totality of the claims in all the causes of action irrespective of whether the causes of action arose out of the same or different transactions. If the total demand exceeds twenty thousand pesos, then the regional trial court has jurisdiction. Needless to state, if the causes of action are separate and independent, their joinder in one complaint is permissive and not mandatory, and any cause of action where the amount of the demand is twenty thousand pesos or less may be the subject of a separate complaint filed with a metropolitan or municipal trial court.

On the other hand, there is a difference between the former and present rules in cases where two or more plaintiffs having separate causes of action against a defendant join in a single complaint. Under the former rule, "where the claims or causes of action joined in a single complaint are separately owned by or due to different parties, each separate claim shall furnish the jurisdictional test" (Section 88 of the Judiciary Act of 1948 as amended, supra). This was based on the ruling in the case of Vda. de Rosario v. Justice of the Peace, 99 Phil. 693. As worded, the former rule applied only to cases of permissive joinder of parties plaintiff. However, it was also applicable to cases of permissive joinder of parties defendant, as may be deduced from the ruling in the case of Brillo v. Buklatan, thus:chanrobles virtualawlibrary chanrobles.com:chanrobles.com.ph

"Furthermore, the first cause of action is composed of separate claims against several defendants of different amounts each of which is not more than P2,000 and falls under the jurisdiction of the justice of the peace court under section 88 of Republic Act No. 296. The several claims do not seem to arise from the same transaction or series of transactions and there seem to be no questions of law or of fact common to all the defendants as may warrant their joinder under Rule 3, section 6. Therefore, if new complaints are to be filed in the name of the real party in interest they should be filed in the justice of the peace court." (87 Phil. 519, 520, reiterated in Gacula v. Martinez, 88 Phil. 142, 146).

Under the present law, the totality rule is applied also to cases where two or more plaintiffs having separate causes of action against a defendant join in a single complaint, as well as to cases where a plaintiff has separate causes of action against two or more defendants joined in a single complaint. However, the causes of action in favor of the two or more plaintiffs or against the two or more defendants should arise out of the same transaction or series of transactions and there should be a common question of law or fact, as provided in Section 6 of Rule 3.

The difference between the former and present rules in cases of permissive joinder of parties may be illustrated by the two cases

which were cited in the case of Vda. de Rosario v. Justice of the Peace (supra) as exceptions to the totality rule. In the case of Soriano y Cia v. Jose (86 Phil. 523), where twenty-nine dismissed employees joined in a complaint against the defendant to collect their respective claims, each of which was within the jurisdiction of the municipal court although the total exceeded the jurisdictional amount, this Court held that under the law then the municipal court had jurisdiction. In said case, although the plaintiffs’ demands were separate, distinct and independent of one another, their joint suit was authorized under Section 6 of Rule 3 and each separate claim furnished the jurisdictional test. In the case of International Colleges, Inc. v. Argonza (90 Phil. 470), where twenty-five dismissed teachers jointly sued the defendant for unpaid salaries, this Court also held that the municipal court had jurisdiction because the amount of each claim was within, although the total exceeded, its jurisdiction and it was a case of permissive joinder of parties plaintiff under Section 6 of Rule 3.

Under the present law, the two cases above cited (assuming they do not fall under the Labor Code) would be under the jurisdiction of the regional trial court. Similarly, in the abovecited cases of Brillo v. Buklatan and Gacula v. Martinez (supra), if the separate claims against the several defendants arose out of the same transaction or series of transactions and there is a common question of law or fact, they would now be under the jurisdiction of the regional trial court.

In other words, in cases of permissive joinder of parties, whether as plaintiffs or as defendants, under Section 6 of Rule 3, the total of all the claims shall now furnish the jurisdictional test. Needless to state also, if instead of joining or being joined in one complaint separate actions are filed by or against the parties, the amount demanded in each complaint shall furnish the jurisdictional test.

In the case at bar, the lower court correctly held that the jurisdictional test is subject to the rules on joinder of parties pursuant to Section 5 of Rule 2 and Section 6 of Rule 3 of the Rules of Court and that, after a careful scrutiny of the complaint, it appears that there is a misjoinder of parties for the reason that the claims against respondents Binongcal and Calion are separate and distinct and neither of which falls within its jurisdiction.

WHEREFORE, the order appealed from is affirmed, without pronouncement as to costs.

SO ORDERED.

Fernan, Alampay, Gutierrez, Jr. and Paras, JJ., concur.

Date post:	17-Feb-2016
Category:	Documents
Upload:	winwin-sancho
View:	239 times
Download:	2 times

Civpro cases Batch 1

Documents