Civpro Jurisdiction Cases

8/12/2019 Civpro Jurisdiction Cases

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G.R. No. L-36098 January 21, 1983

ORTIGAS & COMPANY, LIMITED PARTNERSHIP, petitioner,vs.JUDGE JOSE B. HERRERA, respondent.

R E S O L U T I O N

PER CURIAM:

G.R. No. L-36098 (Ortigas & Company, Limited Partnership vs. Judge Jose B. Herrera, City Court ofManila, Branch II, and Emiliano Samson).On August 14, 1969, petitioner and private respondententered into an agreement thereby for and in consideration of P55,430.00, the former agreed to sellto the latter a parcel of land with a special condition that should private respondent as purchasercomplete the construction including the painting of his residential house on said lot within two (2)years from August 14, 1969, petitioner, as owner, has agreed to refund to private respondent the

amount of P10.00 per square meter. When the aforesaid special condition was fulfilled, privaterespondent, on May 17, 1971 accordingly notified in writing the petitioner of the same and requestedfor his refund amounting to P4,820.00.

Upon failure of petitioner to pay his obligation, private respondent on May 6, 1972 filed a complaintfor sum of money and damages with the City Court of Manila, Branch II, against petitioner docketedas Civil Case No. 211673. A motion to dismiss was filed by petitioner on grounds of lack of

jurisdiction, failure of the complaint to state a cause of action and improper avenue. City Court JudgeJose B. Herrera in his order dated June 27, 1972 held in abeyance the resolution on the motion untilafter the trial of the case on the merits.

A reconsideration of the said order having been denied, petitioner on October 12, 1972 filed with the

Court of First Instance of Manila Branch XXVII, a special civil action for certiorari and prohibition withpreliminary injunction docketed as Civil Case No. 88510. A motion to dismiss was filed by privaterespondent, and on November 17, 1972, the petition was dismissed on the ground that the claim ofprivate respondent in his complaint, being less than P10,000.00, is within the exclusive jurisdiction ofthe city court.

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

The action involved in this case is one for specific performance and not for a sum of money andwherefore incapable of pecuniary estimation because what private respondent seeks is theperformance of petitioner's obligation under a written contract to make a refund but under certainspecific conditions still to be proven or established. In a case for the recovery of a sum of money, asthe collection of a debt, the claim is considered capable of pecuniary estimation (Lapitan vs. ScandiaInc., 24 SCRA 479) because the obligation to pay the debt is not conditioned upon any specific factor matter. But when a party to a contract has agreed to refund to the other party a sum of moneyupon compliance by the latter of certain conditions and only upon compliance therewith may what islegally due him under the written contract be demanded, the action is one not capable of pecuniary


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The contention of the petitioner is devoid of merit because private respondents complaint is an action tocompel the petitioner to remove the illegal and unauthorized installation of glasses at Unit AB-122 of thecondominium which is not capable of pecuniary estimation and falls under the exclusive jurisdiction of theRegional Trial Court Section 33 of Batas Pambansa Bilang 129 is not applicable in the instant case, butparagraph (1), Section 19 and paragraph (1), Section 21 of said law which provide:jgc:chanrobles.com.ph

"Sec. 19. Jurisdiction in civil cases. Regional Trial Courts shall exercise exclusive original jurisdiction: chanrob1esvirtual 1aw library

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

x x x

"Sec. 21. Original jurisdiction in other cases. Regional Trial Courts shall exercise original jurisdiction:chanrob1esvirtual 1aw library

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

A civil action in which the subject of the litigation is incapable of pecuniary estimation has invariably been

held to be within the exclusive original jurisdiction of the Regional Trial Courts. chanrobleslaw library

"In determining whether an action is one the subject matter of which is not capable of pecuniary estimation

this Court has adopted the criterion of first ascertaining the nature of the principal action or remedy sought.If it is primarily for the recovery of a sum of money, the claim is considered capable of pecuniary estimation,and whether jurisdiction is in the municipal courts [now municipal trial courts] or in the courts of first

instance [now regional trial courts] would depend on the amount of the claim. However, where the basicissue is something other than the right to recover a sum of money, or where the money claim is purelyincidental to, or a consequence of, the principal relief sought, this Court has considered such actions ascases where the subject of the litigation may not be estimated in terms of money, and are cognizableexclusively by courts of first instance [now regional trial courts]." 12

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

In the instant case. the claim of attorneys fees by the private respondent in the amount of P10,000.00 is

only incidental to its principal cause of action which is for the removal of the illegal and unauthorizedinstallation of the glasses made by the petitioner and therefore, said amount is not determinative of thejurisdiction of the court.

Note should be taken. however, that the trial court had erroneously considered the complaint as one for

mandatory injunction, misled perhaps by the caption of the complaint. chanrobles.com:cralaw:red

A writ for mandatory injunction is a provisional remedy. It is provisional because it constitutes a temporarymeasure availed of during the pendency of the main action and it is ancillary because it is a mere incident in

and is dependent upon the result of the main action. 13

WHEREFORE, the petition for certiorariand prohibition with restraining order and preliminary injunction ishereby DISMISSED for lack of merit and the decision of the Court of Appeals promulgated on March 11,1991 is hereby AFFIRMED.

SO ORDERED.

Narvasa, C.J., Padilla, Regalado and Melo,JJ., concur.


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[G.R. No. 149243. October 28, 2002]

LOLITA B. COPIOSO, peti t ioner, vs. LAURO, DOLORES,

RAFAEL, ESTEBAN, and CORAZON, all surnamed COPIOSO,and COURT OF APPEALS, respondents.

D E C I S I O N

BELLOSILLO, J.:

This petition for review assails the Decision [1]of the Court of Appeals in CA G.R. SPNo. 62090 which dismissed petitioner's petition for certiorari as well as its Resolutiondenying reconsideration thereof.

On 4 July 2000 respondents Lauro, Dolores, Rafael, Esteban and Corazon, all

surnamed Copioso, filed a complaint[2]

for reconveyance of two (2) parcels of coconutland situated in Banilad, Nagcarlan, Laguna, against Lolita B. Copioso, spousesBernabe and Imelda Doria, and the estate of deceased Antonio Copioso, as well asvendees Dolores Reduca, Mercedes Reduca, Rosario Pascua, Elvira Bombasi andFederico Casabar.

Respondents alleged that they together with their deceased brother AntonioCopioso were co-owners of the subject property having inherited the same from theirparents, and that through fraud and machination Antonio had the property transferred tohis name and that of spouses Bernabe and Imelda Doria who subsequently sold thesame to third parties. They thus prayed for the reconveyance of the property by virtueof their being co-owners thereof.

When respondents claimed in a manifestation with motion for bill of particulars thatthe assessed value of the subject property was P3,770.00, petitioner Lolita Copioso andspouses Bernabe and Imelda Doria separately moved to dismiss the complaint on theground that it was the Municipal Trial Court (MTC) and not the Regional Trial Court(RTC) that had jurisdiction over the case considering that the assessed value of theproperty was lower than P20,000.00.

The trial court in its twin orders of 5 and 12 September 2000 denied the motions todismiss holding that since the subject matter of the action was beyond pecuniaryestimation it was properly within its jurisdiction.[3]Lolita Copioso's Motion forReconsideration was denied,[4]hence, she filed with the Court of Appeals a petition

for certiorariand prohibition praying for the annulment of the twin orders of the trial courtwhich denied the motions to dismiss and at the same time maintaining her position thatthe RTC had no jurisdiction over the case because the assessed value of the propertywas below P20,000.00.

The appellate court denied the petition thus affirming the jurisdiction of the RTCover the complaint for reconveyance. Motion for reconsideration thereon was similarlydenied by the appellate court, hence this petition.
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Petitioner Lolita Copioso anchors her argument on Sec. 33, par. (3), of B.P. Blg.129 otherwise known as TheJudiciary Reorganization Act of 1980as amended by Sec.3 of RA 7691 which provides -

Sec. 33.Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and

Municipal Circuit Trial Courts in Civil Cases.Metropolitan Trial Courts, MunicipalTrial Courts and Municipal Circuit Trial Courts shall exercise: x x x x (3) Exclusiveoriginal jurisdiction in all civil actions which involve title to, or possession of, realproperty, or any interest therein where the assessed value of the property or interesttherein does not exceed twenty thousand pesos (P20,000.00) or, in civil actions inMetro Manila, where such assessed value does not exceed fifty thousand pesos(P50,000.00) exclusive of interest, damages of whatever kind, attorneys fees,litigation expenses and costs: Provided, that in cases of land not declared for taxationpurposes, the value of such property shall be determined by the assessed value of theadjacent lots.

Petitioner argues that the complaint for reconveyance cannot be resolved unlessthe trial court delves upon the issues of "title, possession and interests" of each of thestakeholders over the subject parcels of land. She asserts that the allegations and reliefprayed for in the complaint coupled with the assessed value of the disputed propertyplace the action within the exclusive jurisdiction of the MTC and not the RTC.

In turn, private respondents anchor their position on Sec. 19, par. (1), of the samelaw which provides -

Sec. 19.Jurisdiction in civil cases.The Regional Trial Courts shall exercise

exclusive original jurisdiction: In all civil actions in which the subject of the litigationis incapable of pecuniary estimation: x x x

Simply, they claim that the instant complaint for reconveyance is a case of joinder ofcauses of action which include the annulment of sale and other instruments of falseconveyance incapable of pecuniary estimation thus within the legal competence of theRTC.

The law on jurisdiction of trial courts over civil cases is neither ambiguous norconfusing. Sec. 33, par. (3), in relation to Sec. 19 par. (2) of B.P. 129 as amended byRA 7691, deals with civil cases capable of pecuniary estimation. On the other hand,Sec. 33, par. (3), in relation to Sec. 19, par. (1), applies to cases incapable of pecuniary

estimation.

Sec. 33, par. (3), in relation to Sec. 19, par. (2), of B.P. 129, as amended by RA7691, provides that in civil cases involving sum of money or title to, possession of, orany interest in real property, jurisdiction is determined on the basis of the amount of theclaim or the assessed value of the real property involved, such that where the sum ofmoney or the assessed value of the real property does not exceed P20,000.00,


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or P50,000.00 in Metro Manila, jurisdiction lies with the MTC; and where it exceeds thatamount, jurisdiction is vested with the RTC.

Indeed, the present dispute pertains to the title, possession and interest of each ofthe contending parties over the contested property the assessed value of which fallswithin the jurisdictional range of the MTC. Nonetheless, the nature of the action filed,

the allegations set forth, and the reliefs prayed for, forestall its cognizance by the MTC.

As can be readily gleaned from the records, the complaint was for "Reconveyanceand/or Recovery of Common Properties Illegally Disposed, with Annulment of Sales andother Instruments of False Conveyance, with Damages, and Restraining Order." Privaterespondents alleged therein that they were co-owners of the property along with theirdeceased brother Antonio Copioso; and that in or about 1998, with fraud andmachination, Antonio together with the spouses Bernabe and Imelda Doria made itappear in a public document entitled Pagpapatunay ng Kusang Loob naPagbabahagithat they were the co-owners of the subject property and had divided thesame equally between themselves to the exclusion of private

respondents. Subsequently, they sold the subdivided lots to the other defendantsnamely Dolores Reduca, Mercedes Reduca, Rosario Pascua, Elvira Bombasi andFederico Casabar.

Private respondents also sought payment of moral damages, exemplary damages,litigation expenses, attorney's fees plus appearance fees amounting to more orless P286,500.00. They likewise applied for a TRO pending the issuance of a writ ofpreliminary injunction restraining the defendants from further alienating the commonproperties. They also prayed of the trial court to order the cancellation, annulmentand/or rescission of the four (4) deeds of absolute sale made in favor of the buyers, andto order Lolita B. Copioso and the estate of Antonio Copioso to return the price that thebuyer-defendants had paid to them for the land sold.

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

As correctly opined by the appellate court, if the only issue involved herein is nakedpossession or bare ownership, then petitioner Lolita Copioso would not be amiss in herassertion that the instant complaint for reconveyance, considering the assessed valueof the disputed property, falls within the exclusive jurisdiction of the MTC. But as hereinbefore stated, the issue of title, ownership and/or possession thereof is intertwined with

the issue of annulment of sale and reconveyance hence within the ambit of thejurisdiction of the RTC. The assessed value of the parcels of land thus becomes merelyan incidental matter to be dealt with by the court, when necessary, in the resolution ofthe case but is not determinative of its jurisdiction.

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


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SO ORDERED.

Mendoza, andQuisumbing, JJ., concur.Austria-Martinez, J., on leave.Callejo, Sr., J., no part in deliberation.

G.R. No. 139031 October 18, 2004

MARIE ANTOINETTE R. SOLIVEN,petitioner,vs.FASTFORMS PHILIPPINES, INC.,respondent.

D E C I S I O N

SANDOVAL-GUTIERREZ, J.:

For our resolution is the instant petition for review on certiorari1

assailing the Decision2

datedFebruary 8, 1999 and Resolution dated June 17, 1999, both issued by the Court of Appeals inCA-G.R. CV No. 51946.

Records show that on May 20, 1994, Marie Antoinette R. Soliven, petitioner, filed with theRegional Trial Court, Branch 60, Makati City a complaint for sum of money with damagesagainst Fastforms Philippines, Inc., respondent, docketed as Civil Case No. 94-1788.

The complaint alleges that on June 2, 1993, respondent, through its president Dr. EduardoEscobar, obtained a loan from petitioner in the amount of One Hundred Seventy ThousandPesos (P170,000.00), payable within a period of twenty-one (21) days, with an interest of 3%,as evidenced by a promissory note3executed by Dr. Escobar as president of respondent. The

loan was to be used to pay the salaries of respondents employees. On the same day,respondent issued a postdated check (dated June 25, 1993)4in favor of petitioner in the amountof P175,000.00 (representing the principal amount of P170,000.00, plus P5,000.00 as interest).It was signed by Dr. Escobar and Mr. Lorcan Harney, respondent's vice-president. About threeweeks later, respondent, through Dr. Escobar, advised petitioner not to deposit the postdatedcheck as the account from where it was drawn has insufficient funds. Instead, respondentproposed to petitioner that the P175,000.00 be "rolled-over," with a monthly interest of 5%(or P8,755.00). Petitioner agreed to the proposal. Subsequently, respondent, through Dr.Escobar, Mr. Harney and Mr. Steve Singson, the new president, issued several checks in thetotal sum of P76,250.00 in favor of petitioner as payment for interests corresponding to themonths of June, August, September, October and December, 1993. Later, despite petitionersrepeated demands, respondent refused to pay its principal obligation and interests due.

In her complaint, petitioner prays:

"WHEREFORE, premises considered, it is respectfully prayed of this Honorable Court thatjudgment be rendered:

(a) holding/declaring defendant (now respondent) guilty of breach of contract x x x;and


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(b) ordering defendant to pay plaintiff (now petitioner) the following sums:

P195,155.00 as actual damages;

P200,000.00 as moral damages;

P100,000.00 as exemplary damages; and

P100,000.00 as attorneys fees, plus the costs of suit.

Plaintiff prays for such other relief just and equitable in the premises."

Respondent, in its answer with counterclaim,5denied that it obtained a loan from petitioner; andthat it did not authorize its then president, Dr. Eduardo Escobar, to secure any loan frompetitioner or issue various checks as payment for interests.

After trial on the merits, the court a quo rendered a Decision dated July 3, 19956in favor ofpetitioner, the dispositive portion of which reads:

"22. WHEREFORE, the court hereby renders judgment as follows:

22.1. The defendant FASTFORMS PHILS., INC. is ordered to pay the plaintiff,MARIE ANTOINETTE R. SOLIVEN, the following amounts:

22.1.1. P175,000.00the amount of the loan and its interest covered by thecheck (Exh. 3);

22.1.2. Five (5%) percent of P175,000.00a month from June 25, 1993 untilthe P175,000.00 is fully paidless the sum of P76,250.00as interest;

22.1.3. P50,000.00as attorneys fees.

22.2. The COMPLAINT for MORAL and EXEMPLARY damages is DISMISSED.

22.3. The COUNTERCLAIM is DISMISSED; and

22.4. Costs is taxed against the defendant."

Respondent then filed a motion for reconsideration7questioning for the first time the trial courtsjurisdiction. It alleged that since the amount of petitioners principal demand (P195,155.00) doesnot exceed P200,000.00, the complaint should have been filed with the Metropolitan Trial Court

pursuant to Republic Act No. 7691.8

Petitioner opposed the motion for reconsideration, stressing that respondent is barred fromassailing the jurisdiction of the trial court since it has invoked the latters jurisdiction by seekingaffirmative relief in its answer to the complaint and actively participated in all stages of the trial.9

In its Order dated October 11, 1995,10the trial court denied respondents motion forreconsideration, holding that it has jurisdiction over the case because the totality of the claim


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therein exceeds P200,000.00. The trial court also ruled that respondent, under the principle ofestoppel, has lost its right to question its jurisdiction.

On appeal, the Court of Appeals reversed the trial courts Decision on the ground of lack ofjurisdiction. The Appellate Court held that the case is within the jurisdiction of the MetropolitanTrial Court, petitioners claim being onlyP195,155.00; and that respondent may assail the

jurisdiction of the trial court anytime even for the first time on appeal.

Petitioner filed a motion for reconsideration but was denied by the Court of Appeals in itsResolution dated June 17, 1999.11

Hence, this petition.

The fundamental issue for our resolution is whether the trial court has jurisdiction over CivilCase No. 94-1788.

Section 1 of Republic Act No. 7691, which took effect on April 15, 199412or prior to the

institution of Civil Case No. 94-1788, provides inter alia that where the amount of the demand incivil cases instituted in Metro Manila exceeds P200,000.00, exclusive of interest, damages ofwhatever kind, attorneys fees, litigation expenses, and costs, the exclusiveoriginal jurisdictionthereof is lodged with the Regional Trial Court.

Under Section 3 of the same law, where the amount of the demand in the complaint instituted inMetro Manila does not exceed P200,000.00, exclusive of interest, damages of whatever kind,attorneys fees, litigation expenses, and costs, the exclusive original jurisdiction over the sameis vested in the Metropolitan Trial Court, Municipal Trial Court and Municipal Circuit Trial Court.

In Administrative Circular No. 09-94 dated March 14, 1994, we specified the guidelines in theimplementation of R.A. 7691. Paragraph 2 of the Circular provides:

"2. The exclusion of the term damages of whatever kind in determining the jurisdictionalamount under Section 19 (8) and Section 33 (1) of B.P. Blg. 129, as amended by R.A. No.7691, applies to cases where the damages are merely incidental to or a consequence of themain cause of action. However, in cases where the claim for damages is the main cause ofaction, or one of the causes of action, the amount of such claim shall be considered indetermining the jurisdiction of the court." (underscoring ours)

Here, the main cause of action is for the recovery of sum of money amounting toonly P195,155.00. The damages being claimed by petitioner are merely the consequences ofthis main cause of action. Hence, they are not included in determining the jurisdictional amount.It is plain from R.A. 7691 and our Administrative Circular No. 09-94 that it is the Metropolitan

Trial Court which has jurisdiction over the instant case. As correctly stated by the Court ofAppeals in its assailed Decision:

"Conformably, since the action is principally for the collection of a debt, and the prayer fordamages is not one of the main causes of action but merely a consequence thereto, it shouldnot be considered in determining the jurisdiction of the court."

While it is true that jurisdiction may be raised at any time, "this rule presupposes that estoppelhas not supervened."13In the instant case, respondent actively participated in all stages of the


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proceedings before the trial court and invoked its authority by asking for an affirmative relief.Clearly, respondent is estopped from challenging the trial courts jurisdiction, especially when anadverse judgment has been rendered. In PNOC Shipping and Transport Corporation vs. Courtof Appeals,14we held:

"Moreover, we note that petitioner did not question at all the jurisdiction of the lower court x x

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

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

weruled:

"In the case at bar, it was found by the trial court in its 30 September 1996 decision in LCRCase No. Q-60161(93) that private respondents (who filed the petition for reconstitution oftitles) failed to comply with both sections 12 and 13 of RA 26 and therefore, it had no

jurisdiction over the subject matter of the case. However, private respondents neverquestioned the trial courts jurisdiction over its petition for reconstitution throughout theduration of LCR Case No. Q-60161(93). On the contrary, private respondents activelyparticipated in the reconstitution proceedings by filing pleadings and presenting its evidence.They invoked the trial courts jurisdiction in order to obtain affirmative relief thereconstitution of their titles. Private respondents have thus foreclosed their right to raise theissue of jurisdiction by their own actions.

"The Court has constantly upheld the doctrine that while jurisdiction may be assailed at anystage, a litigants participation in all stages of the case before the trial court, including theinvocation of its authority in asking for affirmative relief, bars such party from challenging thecourts jurisdiction (PNOC Shipping and Transport Corporation vs. Court of Appeals, 297SCRA 402 [1998]). A party cannot invoke the jurisdiction of a court to secure affirmative reliefagainst his opponent and after obtaining or failing to obtain such relief, repudiate or questionthat same jurisdiction (Asset Privatization Trust vs. Court of Appeals, 300 SCRA 579 [1998];Province of Bulacan vs. Court of Appeals, 299 SCRA 442 [1998]). The Court frowns uponthe undesirable practice of a party participating in the proceedings and submitting his casefor decision and then accepting judgment, only if favorable, and attacking it for lack of

jurisdiction, when adverse (Producers Bank of the Philippines vs. NLRC, 298 SCRA 517

[1998], citing Ilocos Sur Electric Cooperative, Inc. vs. NLRC, 241 SCRA 36 [1995])."(underscoring ours)

WHEREFORE,the instant petition is GRANTED. The assailed Decision dated February 8, 1999and Resolution dated June 17, 1999 of the Court of Appeals in CA-G.R. CV No. 51946are REVERSED. The Decision dated July 3, 1995 and Resolution dated October 11, 1995 ofthe Regional Trial Court, Branch 60, Makati City in Civil Case No. 94-1788 arehereby AFFIRMED.


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SO ORDERED.

Panganiban, Corona, and Carpio Morales*, JJ.,concur.

G.R. No. 119347 March 17, 1999

EULALIA RUSSELL, PUPERTO TAUTHO, FRANCISCO TAUTHO, SUSANA T. REALES,APITACIO TAUTHO, DANILO TAUTHO, JUDITHA PROS, GREGORIO TAUTHO, DEODITA T.JUDILLA, AGRIPINO TAUTHO, FELIX TAUTHO, WILLIAM TAUTHO, AND MARILYNPERALES, petitioners,vs.HONORABLE AUGUSTINE A. VESTlL, ADRIANO TAGALOG, MARCELO TAUTHO, JUANITAMENDOZA, DOMINGO BANTILAN, RAUL BATALUNA AND ARTEMIOCABATINGAN, respondent.

KAPUNAN, J .:

Before us is a Petition for Certiorarito set aside the Order dated January 12, 1995 issued byrespondent Judge Augustine A. Vestil of the Regional Trial Court of Mandaue City, Branch 56,dismissing the complaint filed by petitioners on ground of lack of jurisdiction, as well as his Orderdated February 13, 1995 denying petitioners' Motion for Reconsideration of the order of dismissal.

The facts of the case are as follows:

On September 28, 1994, petitioners filed a complaint against private respondents, denominated"DECLARATION OF NULLITY AND PARTITION," with the Regional Trial Court of MandaueCity, Branch 56, docketed as Civil Case No. MAN-2275. The complaint, in substance, allegedthat petitioners are co-owners of that parcel of land, Lot 6149 situated in Liloan, Cebu and

containing an area of 56,977.40 square meters, more or less. The land was previously ownedby the spouses Casimero Tautho and Cesaria Tautho. Upon the death of said spouses, theproperty was inherited by their legal heirs, herein petitioners and private respondents. Sincethen, the lot had remained undivided until petitioners discovered a public documentdenominated "DECLARATION OF HEIRS AND DEED OF CONFIRMATION OF A PREVIOUSORAL AGREEMENT OF PARTITION," executed on June 6, 1990. By virtue of this deed, privaterespondents divided the property among themselves to the exclusion of petitioners who are alsoentitled to the said lot as heirs of the late spouses Casimero Tautho and Cesaria Tautho.Petitioners claimed that the document was false and perjurious as the private respondents werenot the only heirs and that no oral partition of the property whatsoever had been made betweenthe heirs. The complaint prayed that the document be declared null and void and an order beissued to partition the land among all the heirs. 1

On November 24, 1994, private respondents filed a Motion to Dismiss 2the complaint on theground of lack of jurisdiction over the nature of the case as the total assessed value of thesubject land is P5,000.00 which under section 33 (3) 3of Batas Pambansa Blg. 129, asamended by R.A. No. 7691, 4falls within the exclusive jurisdiction of the Municipal Circuit TrialCurt of Liloan, Compostela. 5


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Petitioners filed an Opposition to the Motion to Dismiss 6saying that the Regional Trial Courthas jurisdiction over the case since the action is one which is incapable of pecuniary estimationwithin the contemplation of Section 19(1) of B.P. 129, as amended. 7

On January 12, 1995, the respondent judge issued an Order granting the Motion to Dismiss. 8AMotion for Reconsideration of said order was filed by petitioners on January 30, 1995 alleging

that the same is contrary to law because their action is not one for recovery of title to orpossession of the land but an action to annul a document or declare it null and void, 9hence,one incapable of pecuniary estimation falling within the jurisdiction of the Regional Trial Court.Private respondents did not oppose the motion for reconsideration.

On February 13, 1995, the respondent judge issued another Order denying the motion forreconsideration. 10

Hence, this petition wherein the sole issue raised is whether or not the Regional Trial Court hasjurisdiction to entertain Civil Case No. MAN-2275.

We find merit in the petition.

Petitioners maintain the view that the complaint filed before the Regional Trial Court is for theannulment of a document denominated as "DECLARATION OF HEIRS AND DEED OFCONFIRMATION OF PREVIOUS ORAL PARTITION," which is clearly one incapable of pecuniaryestimation, thus, cognizable by the Regional Trial Court.

Private respondents, on the other hand, insists that the action is one for re-partition and since theassessed value of the property as stated in the complaint is P5,000.00, then, the case falls within the

jurisdiction of the Municipal Circuit Trial Court of Liloan, Compostela, Cebu.

For better appreciation of the facts, the pertinent portions of the complaint are reproducedhereunder:

xxx xxx xxx

3. That the plaintiffs and the defendants are the legal heirs of spouses CasimeroTautho and Cesaria N. Tautho who died long time ago;

4. That in life the spouses became the owners in fee simple of a certain parcel ofland, which is more particularly described as follows:

A parcel of land containing 56,97740 square meters, more or less,located at Cotcot, Liloan, Cebu.

designated as Lot 6149 per Technical Description and Certification issued by theOffice of the Land Management copy of which are hereto attached as Annexes "A"and "A-1" and are made part hereof: total assessed value is P5,000.00;

5. That the passed to the children of the spouses (who are all deceased except fordefendant Marcelo Tautho), namely: Zacarias, Epifania, Vicenta, Felecisimo, Maria,Lorencia and Marcelo, and which in turn passed to the plaintiffs and defendants upontheir death they being their descendants and legal heirs;


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6. That the subject parcel of land has for year been undivided by and among thelegal heirs of said previous owners;

7. That, very recently, plaintiffs discovered a public document, which is a declarationof heirs and deed of confirmation of a previous oral agreement of partition, affectingthe land executed by and among the defendants whereby defendants divided the

property among themselves to the exclusion of plaintiffs who are entitled thereto;attached hereto as Annex "B" and is made part hereof is xerox copy of saiddocument;

8. That the instrument (Annex "B") is false and perjurious and is a complete nullitybecause the defendants are not the only heirs of Casimero Tautho; plaintiffs are alsoheirs and descendants of said deceased; moreover, there has been no oral partitionof the property;

9. That pursuant to said document (Annex "B"), defendants had procured taxdeclarations of the land for their supposed "shares" to the great damage andprejudice of plaintiffs;

10. That the property in controversy should be divided into seven (7) equal partssince Casimero Tautho and Cesaria N. Tautho had seven children;

11. That the parties had failed to settle the controversy amicably at the barangaylevel; attached hereto as Annex "C" is Certification to file Action;

12. That by reason of the foregoing unjust and illegal act of defendants, plaintiffswere forced to bring instant action and contract the services of the undersignedcounsel with whom they bind themselves to pay P30,000.00 as attorney's fees.

WHEREFORE, it is most respectfully prayed of this Honorable Court to declare null

and void the document (Annex "B") of declaration of heirs and confirmation and toorder the partition of the land into seven (7) equal parts; each part shall respectivelygo to the seven (7) children of Casimero Tautho and considering six (6) of them diedalready the same shall go to their children or descendants, and to order thedefendants to pay plaintiffs attorney's fees in the amount of P30,000.00.

Plaintiffs further pray for such other reliefs and remedies just and equitable under thepremises. 11

We agree with petitioners.

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

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

[I]n determining whether an action is one the subject matter of which is not capable ofpecuniary estimation this Court has adopted the criterion of first ascertaining the nature ofthe principal action or remedy sought. If it is primarily for the recovery of a sum of money,the claim is considered capable of pecuniary estimation, and whether jurisdiction is in themunicipal courts or in instance would depend on the amount of the claim. However,where the basic issue is something other than the right to recover a sum of money, where


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the money claim is purely incidental to, or a consequence of, the principal relief sought,this Court has considered such where the subject of the litigation may not be estimated interms of money, and are cognizable exclusively by courts of first instance (now RegionalTrial Courts). 13

Examples of actions incapable of pecuniary estimation are those for specific performance,

support, or foreclosure of mortgage or annulment of judgment;14

also actions questioning thevalidity of a mortgage, 15annulling a deed of sale or conveyance and to recover the pricepaid 16and for rescession, which is a counterpart of specific performance. 17

While actions under Sec. 33(3) of B.P. 129 are also incapable of pecuniary estimation, the lawspecifically mandates that they are cognizable by the MTC, METC, or MCTC where theassessed value of the real property involved does exceed P20,000.00 in Metro Manila, orP50,000.00, if located elsewhere. If the value exceeds P20,000.00 or P50,000.00 as the casemay be, it is the Regional Trial Courts which have jurisdiction under Sec. 19(2). 18However, thesubject matter of the complaint in this case is annulment of a document denominated as"DECLARATION OF HEIRS AND DEED OF CONFIRMATION OF PREVIOUS ORALPARTITION."

The main purpose of petitioners in filing the complaint is to declare null and void the documentin which private respondents declared themselves as the only heirs of the late spousesCasimero Tautho and Cesaria Tautho and divided his property among themselves to theexclusion of petitioners who also claim to be legal heirs and entitled to the property. While thecomplaint also prays for the partition of the property, this is just incidental to the main action,which is the declaration of nullity of the document above-described. It is axiomatic that

jurisdiction over the subject matter of a case is conferred by law and is determined by theallegations in the complaint and the character of the relief sought, irrespective of whether theplaintiff is entitled to all or some of the claims asserted therein. 19

WHEREFORE, premises considered, the petition is hereby GRANTED. The Order dismissing Civil

Case No. MAN-2275, as well as the Order denying the motion for reconsideration of said Order, isSET ASIDE.

The Regional Trial Court, Branch 56, Mandaue City is ORDERED to proceed with dispatch inresolving Civil Case No. MAN-2275. No costs.

SO ORDERED.

Davide, Jr., C.J., Melo and Pardo, JJ., concur.

G.R. No. 134230 July 17, 2002

JOVENAL OUANO, petitioner,vs.PGTT INTERNATIONAL INVESTMENT CORPORATION and HON. JUDGE RAMON G.CODILLA, JR.,respondents.

SANDOVAL-GUTIERREZ, J.:


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PGTT International Investment Corporation (PGTT), respondent, is a corporation duly organizedunder existing laws, with address at YASCO Bldg., M. J. Cuenco Ave., Cebu City.

On December 11, 1997, PGTT filed with the Regional Trial Court (RTC), Branch 20, Cebu City,a verified complaint against Jovenal Ouano, petitioner, docketed as Civil Case No. CEB- 21319,entitled "PGTT INTERNATIONAL INVESTMENT CORPORATION, Plaintiff, vs. JUVENAL

OUANO, Defendant," for "Recovery of Ownership and Possession of Real Property andDamages."1In its complaint, PGTT alleged that it is the owner of Lot Nos. 1-10, Block 2 of theSunnymeade Crescent Subdivision located at Pit-os, Talamban, Cebu City. Sometime inOctober of 1996, PGTT found that Ouano uprooted the concrete monuments of the said lots,plowed them and planted corn thereon. Despite PGTTs demand that he vacate the lots andrestore them to their original condition, Ouano refused, claiming he is the owner and lawfulpossessor of the 380 square meters he occupied. Due to Ouanos wrongful act, PGTT wasdeprived of the use of its property and suffered damages in the amount of P100,000.00 a year.Likewise, PGTT was constrained to file the subject action and hired the services of his counselfor P100,000.00. PGTT prayed:

"WHEREFORE, in view of all the foregoing, it is most respectfully prayed that after due

notice and hearing, judgment be rendered ordering defendant (Jovenal Ouano) to vacate thepremises and restore the lots to their original condition; pay plaintiff (PGTT) P100,000.00 asdamages per year, beginning October, 1996 until he shall have vacated the premises andrestored the lots to their original condition; payP100,000.00 as attorney's fees; andpay P50,000.00 as expenses of litigation.

"Plaintiff prays for such other reliefs and remedies, just and equitable under the premises." 2

On February 5, 1998, Ouano filed a motion to dismiss the complaint on the ground that it is theMunicipal Trial Court (MTC), not the RTC, which has jurisdiction over it considering thatthe assessed value of the lots involved is only P2,910, as indicated in the latest taxdeclaration,3citing Section 19 (paragraph 2) and Section 33 (paragraph 3) of Batas Pambansa

Bilang 129 (The Judiciary Reorganization Act of 1980), as amended by Republic Act No. 7691.4

In its opposition to Ouanos motion, PGTT contends that the RTC has jurisdiction sincethe market value of the lots is P49,760.00.5Besides, the complaint is not only an action forrecovery of ownership and possession of real property, but also for damagesexceeding P100,000.00, over which claim the RTC has exclusive original jurisdiction underSection 19 (paragraph 8) of the same law.

On March 6, 1998, the RTC, presided by Judge Ramon G. Codilla, Jr., issued an Order denyingthe motion to dismiss, holding that:

"This court believes that this court has jurisdiction to try this case considering that the real

properties consist of ten parcels of land in a subdivision and the court takes note that there isa discrepancy somewhere by the Office of the City Assessor in the Assessment of theparcels of land for only less thanP2,000.00 and that the government is very much at a lossby these unrealistic valuation."6

Ouano filed a motion for reconsideration but was likewise denied by the RTC in its Order datedMay 27, 1998. The trial court ruled it has jurisdiction over the case because "(i)t is of judicialknowledge that the real properties situated in Cebu City command a higher valuation than those


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indicated in the tax declaration. The observation of plaintiffs (PGTTs) counsel as to the issueon damages is likewise sustained considering that, being a corporation, it may have incurreddamages in the form of unrealized profits."7

Hence the present petition for certiorari filed by Ouano under Rule 65 of the 1997 Rules of CivilProcedure, as amended, assailing the Orders of respondent judge dated March 6, 1998 and

May 27, 1998 as having been issued with grave abuse of discretion amounting to lack or excessof jurisdiction.

At the outset, it is necessary to stress that a direct recourse to this Court is highly improper, for itviolates the established policy of strict observance of the judicial hierarchy of courts.8We needto reiterate, for the guidance of petitioner, that this Courts original jurisdiction to issue a writ ofcertiorari (as well as prohibition, mandamus,quo warranto, habeas corpusand injunction)is concurrent with the Court of Appeals (CA), as in the present case, and with the RTCs inproper cases within their respective regions.9However, this concurrence of jurisdiction does notgrant a party seeking any of the extraordinary writs the absolute freedom to file his petition withthe court of his choice. This Court is a court of last resort, and must so remain if it is tosatisfactorily perform the functions assigned to it by the Constitution and immemorial

tradition.10The hierarchy of courts determines the appropriate forum for such petitions. Thus,petitions for the issuance of such extraordinary writs against the first level ("inferior") courtsshould be filed with the RTC, and those against the latter, with the CA.11A direct invocation ofthis Courts original jurisdiction to issue these writs should be allowed only when there arespecial and important reasons therefor, clearly and specifically set out in the petition. This is theestablished policy. It is a policy that is necessary to prevent inordinate demands upon thisCourts time and attention which are better devoted to those matters within its exclusive

jurisdiction, and to prevent further over-crowding of its docket.12Unfortunately, the instantpetition does not allege any special and compelling reason to justify a direct recourse to thisCourt. However, we deem it more appropriate and practical to resolve the controversy in orderto avoid further delay, but only in this instance.

The lone issue for our resolution is whether the RTC has jurisdiction over Civil Case No. CEB-21319.

The complaint seeks to recover from private respondent the ownership and possession of thelots in question and the payment of damages. Since the action involves ownership andpossession of real property, the jurisdiction over the subject matter of the claim is determined bythe assessed value, notthe market value,thereof, pursuant to Batas Pambansa Blg.129, asamended by R.A. 7691. Section 33 (paragraph 3) of the said law provides:

"Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and MunicipalCircuit Trial Courts in Civil Cases.Metropolitan Trial Courts, Municipal TrialCourts and Municipal Circuit Trial Courts shall exercise:

x x x.

(3) Exclusive original jurisdictionin all civil actions which involve title to, or possessionof, real property, or any interesttherein where the assessed value of the property orinterest therein does not exceed Twenty Thousand Pesos (P20,000.00) or, in civilactions in Metro Manila, where such assessed value does not exceed Fifty Thousand Pesos(P50,000.00) exclusive of interest, damages of whatever kind, attorneys fees, litigation


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

x x x." (Emphasis ours)

Likewise, Section 19 (paragraph 2) of the same law reads:

"Sec. 19. Jurisdiction in civil cases. - The Regional Trial Court shall exercise exclusiveoriginaljurisdiction:

x x x.

(2) In all civil actions, which involve the title to, or possession of, real property, or anyinterest therein,where the assessed value of the property involved exceeds TwentyThousand Pesos (P20,000.00)or, for civil actions in Metro Manila, where such valueexceeds Fifty Thousand Pesos (P50,000.00) except actions for forcible entry into andunlawful detainer of lands or buildings, original jurisdiction over which is conferred upon theMetropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts;

x x x." (Emphasis ours)

It is undisputed that the assessed value of the property involved, as shown by thecorresponding tax declaration, is only P2,910.00. As such, the complaint is well within theMTCsP20,000.00 jurisdictional limit.

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

Respondent judge further held that since the complaint also seeks the recovery of damagesexceedingP100,000.00, then it is within the competence of the RTC pursuant to Section 19(paragraph 8) of Batas Pambansa Blg. 129, as amended by R.A. 7691, which states:

"SEC. 19. Jurisdiction in civil cases.Regional Trial Courts shall exercise exclusive originaljurisdiction:

x x x

"(8) In all other cases in which the demand, exclusive of interest, damages of whatever kind,attorneys fees, litigation expenses, and costs or the value of the property in controversyexceeds One Hundred Thousand Pesos (P100,000.00) or, in such other cases in Metro

Manila, where the demand, exclusive of the above mentioned items exceeds Two hundredthousand pesos (P200,000.00)." (Emphasis ours)

The above provision does not apply to the instant case. It is applicable only to "all other cases"other than an action involving title to, or possession of real property in which the assessedvalue is the controlling factor in determining the courts jurisdiction. Besides, the sameprovision explicitly excludes from the determination of the jurisdictional amount the demandfor "interest, damages of whatever kind, attorneys fees, litigation expenses, and


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costs". The exclusion of such damages is reiterated in Section 33, paragraph 3 of thesame Batas Pambansa Blg. 129, as amended, quoted earlier. The said damages are merelyincidental to, or a consequence of, the main cause of action for recovery of ownership andpossession of real property. In this connection, this Court issued Administrative Circular No. 09-94 setting the guidelines in the implementation of R.A. 7691. Paragraph 2 states:

"2. The exclusion of the term damages of whatever kind in determining thejurisdictional amount under Section 19 (8) and Section 33 (1) of B.P. Blg. 129, asamended by R.A. 7691, applies to cases where the damages are merely incidental toor a consequence of the main cause of action.However, in cases where the claim fordamages is the main cause of action, or one of the causes of action, the amount of suchclaim shall be considered in determining the jurisdiction of the court." (Emphasis ours)

We thus find that in issuing the assailed orders denying petitioners motion to dismiss, thustaking cognizance of the case, the RTC committed grave abuse of discretion.

WHEREFORE, the instant petition is GRANTED. The assailed Orders issued by respondentRTC on March 6, 1998 and May 27, 1998 in Civil Case No. CEB-21319 are SET ASIDE.

Accordingly, the complaint is orderedDISMISSED.

SO ORDERED.

Puno, Panganiban, and Carpio, JJ., concur.

[G.R. No. 136109. August 1, 2002]

RADIO COMMUNICATIONS OF THE PHILIPPINES, INC., pet i t ioner, vs.COURT OF APPEALS and MANUEL DULAWON, respondents.

D E C I S I O N

YNARES-SANTIAGO, J.:

This is a petition for review of the decision of the Court of Appeals [1]in CA-G.R. SPNo. 45987 dated April 30, 1998 [2]and its resolution dated October 15, 1998[3]denying themotion for reconsideration.

On June 18, 1997, private respondent Manuel Dulawon filed with the Regional TrialCourt of Tabuk, Kalinga, Branch 25, a complaint for breach of contract of lease withdamages against petitioner Radio Communications of the Philippines, Inc.(RCPI). Petitioner filed a motion to dismiss the complaint for lack of jurisdictioncontending that it is the Municipal Trial Court which has jurisdiction as the complaint isbasically one for collection of unpaid rentals in the sum of P84,000.00, which does notexceed the jurisdictional amount of P100,000.00 for Regional Trial Courts. The trialcourt denied the motion to dismiss,[4]as well as petitioners motion for
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reconsideration.[5]Hence, petitioner went to the Court of Appeals on a petition forcertiorari. On April 30, 1998, the Court of Appeals dismissed the petition. Thedispositive portion thereof reads:

WHEREFORE, the petition is hereby DENIED DUE COURSE and is

DISMISSED. Costs against petitioner.

SO ORDERED.[6]

The motion for reconsideration of the foregoing decision was denied on October 15,1998. Hence, this petition.

The issue for resolution in this petition is whether or not the Regional Trial Court hasjurisdiction over the complaint filed by private respondent.

Pertinent portion of Batas Pambansa Blg. 129, as amended by Republic Act No.7691, provides:

SEC. 19.Jurisdiction in civil cases.Regional Trial Courts shall exercise exclusiveoriginal jurisdiction:

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

x x x x x x x x x

(8) In all other cases in which the demand, exclusive of interest, damages of

whatever kind, attorneys fees, litigation expenses, and costs or the value of theproperty in controversy exceeds One hundred thousand pesos (P100,000.00) or, insuch other cases in Metro Manila, where the demand, exclusive of theabovementioned items exceeds Two hundred thousand pesos (P200,000.00).[7]

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

x x x x x x x x x

2. The exclusion of the term damages of whatever kind in determining thejurisdictional amount under Section 19 (8) and Section 33 (1) of B.P. 129, as amended

by R.A. No. 7691, applies to cases where the damages are merely incidental to or aconsequence of the main cause of action. However, in cases where the claim fordamages is the main cause of action, or one of the causes of action, the amount ofsuch claim shall be considered in determining the jurisdiction of the court.

x x x x x x x x x.
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InRussell, et al., v. Vestil, et al.,[8]the Court held that in determining whether anaction is one the subject matter of which is not capable of pecuniary estimation, thenature of the principal action or remedy sought must first be ascertained. If it is primarilyfor the recovery of a sum of money, the claim is considered capable of pecuniaryestimation, and jurisdiction over the action will depend on the amount of the claim.

However, where the basic issue is something other than the right to recover a sum ofmoney, where the money claim is purely incidental to, or a consequence of, theprincipal relief sought, the action is one where the subject of the litigation may not beestimated in terms of money, which is cognizable exclusively by Regional Trial Courts.

It is axiomatic that jurisdiction over the subject matter of a case is conferred by lawand is determined by the allegations in the complaint and the character of the reliefsought, irrespective of whether the plaintiff is entitled to all or some of the claimsasserted therein.[9]

In the case at bar, the allegations in the complaint plainly show that privaterespondents cause of action is breach of contract. The pertinent portion of the

complaint recites:x x x x x x x x x

2. That sometime during the end of the year 1995, defendant through itsappropriate officials negotiated with plaintiff the lease of a portion of the lattersbuilding x x x

3. That the lease contract was effective for a period of three (3) years of fromJanuary 1, 1996 to January 1, 1998 with advance payment for the year 1996. Theadvance was not however given in lump sum but on installment. One check that was

given in payment of one months rental for 1996 was even stale and had to be changedonly after demand;

4. That as per contract the monthly rental for 1997 was P3,300.00 while for 1998,it is P3,700.00;

5. That the defendant surreptitiously removed its equipments and otherpersonalities from the leased premises and failed to pay rentals due for the months ofJanuary to March 1997 to the damage and prejudice of plaintiff; that this failure andrefusal on the part of plaintiff accelerated the payment of all rentals for each month

for the years 1997 and 1998;

6. That the acts of defendant amounts to a breach of contract which is unlawfuland malicious, as in fact, it caused plaintiff serious anxiety, emotional stress, andsleepless nights for which he is entitled to moral damages;
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7. That plaintiff conveyed his feelings to Mr. Ronald C. Manalastas as evidencedby a letter dated January 7, 1997 a copy of which is hereto attached to form parthereof as Annex B. This was later followed by a letter of plaintiffs counsel amachine copy of which is hereto attached to form part hereof and marked as AnnexC. Both these letters landed on deaf ears thereby aggravating the worries/anxieties

of plaintiff;

8. That the period agreed is for the benefit of both parties and any unilateraltermination constitutes breach of contract;

9. That defendant actually used the leased premises during the year 1996; that hadit not been for the contract, plaintiff could have leased the premises to other personsfor business purposes; that this unlawful and malicious breach of contract cannot belawfully countenanced hence defendant must be taught a lesson by being ordered topay exemplary damages;

x x x x x x x x x.[10]

It is settled that a breach of contract is a cause of action either for specificperformance or rescission of contracts.[11]In Manufacturers Distributors, Inc. v. SiuLiong,[12]the Court held that actions for specific performance are incapable of pecuniaryestimation and therefore fall under the jurisdiction of the Regional Trial Court. [13]Here,the averments in the complaint reveal that the suit filed by private respondent wasprimarily one for specific performance as it was aimed to enforce their three-year leasecontract which would incidentally entitle him to monetary awards if the court should findthat the subject contract of lease was breached. As alleged therein, petitioners failure

to pay rentals due for the period from January to March 1997, constituted a violation oftheir contract which had the effect of accelerating the payment of monthly rentals for theyears 1997 and 1998. The same complaint likewise implied a premature and unilateraltermination of the term of the lease with the closure of and removal all communicationequipment in the leased premises.[14]Under the circumstances, the court has toscrutinize the facts and the applicable laws in order to determine whether there wasindeed a violation of their lease agreement that would justify the award of rentals anddamages. The prayer, therefore, for the payment of unpaid rentals in the amount ofP84,000.00 plus damages consequent to the breach is merely incidental to the mainaction for specific performance. Similarly, in Manufacturers Distributors Inc.,[15]theCourt explained

x x x x x x x x x

That plaintiffs complaint also sought the payment by the defendant of P3,376.00,

plus interest and attorneys fees, does not give a pecuniary estimation to the litigation,

for the payment of such amounts can only be ordered as a consequence of the specificperformance primarily sought. In other words, such payment would be but an incidentor consequence of defendant's liability for specific performance. If no such liability is
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judicially declared, the payment can not be awarded. Hence, the amounts sought donot represent the value of the subject of litigation.

Subject matter over which jurisdiction can not be conferred by consent, has

reference, not to the res or property involved in the litigation nor to a particular case,

but to the class of cases, the purported subject of litigation, the nature of the actionand of the relief sought (Appeal of Maclain, 176 NW. 817).

Specifically, it has been held that:

The Court has no jurisdiction of a suit for specificperformance of a contract,although the damages alleged for its breach, if permitted, are within the amount ofwhich that court has jurisdiction. (Mebane Cotton Breeding Station. vs. Sides, 257

SW. 302; 21 C.J.S. 59, note).

x x x x x x x x x

Clearly, the action for specific performance case, irrespective of the amount ofrentals and damages sought to be recovered, is incapable of pecuniary estimation,hence cognizable exclusively by the Regional Trial Court. The trial court, therefore, didnot err in denying petitioners motion to dismiss.

WHEREFORE, in view of all the foregoing, the petition is DENIED and the assaileddecision of the Court of Appeals in CA-G.R. SP No. 45987 is AFFIRMED.

SO ORDERED.

Davide, Jr., C.J., (Chairman), Vitug, Kapunan, andAustria-Martinez, JJ., concur.

G.R. No. L-46000 March 18, 1985

GLICERIO AGUSTIN (Deceased) as Administrator of the Intestate Estate of SusanaAgustin, petitioner-plaintiff-appellant,vs.LAUREANO BACALAN and the PROVINCIAL SHERIFF OF CEBU, respondents-defendants-appellees.

GUTIERREZ, JR., J.:

The precursor of this case was a complaint for ejectment with damages filed by plaintiff-appellantAgustin, as adininistrator of the Intestate Estate of Susana Agustin, against defendant-appelleeBacalan, before the City Court of Cebu.

Bacalan is a lessee of a one-door ground floor space in a building owned by the late SusanaAgustin. Due to nonpayment of rentals despite repeated demands an action to eject him was filed.


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In his complaint, the plaintiff-appellant prayed that the defendant-appellee be ordered to immediatelyvacate the place in question, to pay plaintiff-appellant the sum of P2,300.00 representing arrearagesin rentals plus the corresponding rentals until he actually vacates the place, attorney's fees,expenses, and costs.

In his answer, the defendant-appellee included a counter-claim alleging that the present action was

"clearly unfounded and devoid of merits, as it is tainted with malice and bad faith on the part of theplaintiff for the obvious reason that plaintiff pretty well knows that defendant does not have anyrentals in arrears due to the estate of Susana Agustin, but notwithstanding this knowledge, plaintifffiled the present action merely to annoy, vex, embarrass and inconvenience the defendant." Hestated, "That by virtue of the unwarranted and malicious filing of this action by the plaintiff against thedefendant, the latter suffered, and will continue to suffer, actual and moral damages in the amount ofno less than P50,000.00; P10,000.00 in concept of exemplary damages. In addition, defendant hasbeen compelled to retain the services of undersigned counsel to resist plaintiffs' reckless, maliciousand frivolous claim and to protect and enforce his rights for which he obligated himself to pay thefurther sum of P3,500.00 as attorney's fees."

The City Court of Cebu subsequently rendered judgment dismissing the counterclaim and orderingthe defendant to vacate the premises in question and to pay the plaintiff the sum of P3,887.10 asunpaid back rentals and the sum of P150.00 as attorney's fees' From this decision, the defendantfiled an appeal with Branch Ill of the Court of First Instance of Cebu. The case was designated asCivil Case No. R-12430.

Availing of Republic Act 6031 which does away with trials de novo in appeals before it, the Court ofFirst Instance rendered a decision, the dispositive portion of which reads:

WHEREFORE, based on all the foregoing considerations, the appealed judgment ishereby set aside. Judgment is hereby required in favor of the defendant

1. Ordering the plaintiff to pay.

a) P10,000.00 as moral damages;

b) P5,000.00 as exemplary damages;

c) P1,000.00 as attorney's fees; and

2. With costs against plaintiff.

JUDGMENT REVERSED.

No appeal was taken by the plaintiff-appellant. The decision lapsed into finality and became

executory. A writ of execution was issued by virtue of which a notice to sell at public auction realproperties belonging to the estate of Susana Agustin was issued by the Deputy Sheriff to satisfyjudgment in the case. Plaintiff's counsel filed a motion for reconsideration, confessing his fault andgiving the reason why he failed to perfect the appeal on time. The motion was denied.

Thereafter, with the aid of new counsel, the plaintiff-appellant filed a complaint with Branch V, Courtof First Instance of Cebu, against the defendant and the Deputy Sheriff of Cebu for the declaration ofthe nullity of the above-cited decision of Branch III, Court of First Instance of Cebu in the ejectment


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case on the ground that the exercise of its appellate jurisdiction was null and void from the beginningfor the following reasons:

(a) It grants relief in the total sum of P16,000.00 (exclusive of costs) distributed thus:

P10,000.00 as moral damages

P5,000.00 as exemplary damages

P1,000.00 as attorney's fees

which is clearly beyond the jurisdiction of the City Court of Cebu; Section 88 of theJudiciary Act of 1948, as amended by Rep. Acts Nos. 2613 and 3828, limits the

jurisdiction of the city courts in civil cases to P10,000.00 as the maximum amount ofthe demand (exclusive of interest and costs);

(b) Moreover, said Decision (Annex "G") grants moral damages to the defendant inthe sum of P10,000.00 which constitutes a grave abuse of discretion amounting to

lack of jurisdiction, there being no evidence to support it and the subject matter of thesuit in Civil Case No. R-13504 being purely contractual where moral damages arenot recoverable.

A motion to dismiss was filed by the defendant on the grounds that the plaintiff has no cause ofaction and that the court lacks jurisdiction to declare the nullity of a decision of another branch of theCourt of First Instance of Cebu.

While rejecting the second ground for the motion to dismiss, the court sustained the defendant andruled:

Clearly from a reading of the complaint, the plaintiff seeks the annulment of the

decision rendered by the Third Branch of this Court because the award exceeded thejurisdiction amount cognizable by the City Court of Cebu and the said Branch III ofthis Court has no jurisdiction to award the defendants herein (plaintiff in Civil CaseNo. 12430) an amount more than P10,000.00;

It is the considered opinion of this Court that this allegation of the herein plaintiffcannot be availed of as a ground for annulment of a judgment. It may perhaps, or atmost, be a ground for a petition for certiorari. But then, the remedy should be availedof within the reglementary period to appeal. Nevertheless, even if the plaintiff did takehis cause by certiorari, just the same, it would have been futile....

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In fine, this Court believes that the present complaint fails to allege a valid cause ofaction as the same is only a clear attempt at utilizing the remedy for the annulment ofthe judgment rendered by this Court in Civil Case No. 12430 to offset the adverseeffects of failure to appeal.

Plaintiff-appellant's motion for reconsideration was denied, prompting him to file an appeal before theCourt of Appeals, which, in a resolution, certified the same to us on the ground that it involves purequestions of law.


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bar, set up his claim in excess of the jurisdiction of the city court as a compulsory counterclaim.What is the legal effect of such a move?

Pertinent to our disposition of this question is our pronouncement in the case of Hyson Tan, et al. v.Filipinas Compania de Seguros, et al., (G.R. No. L-10096, March 23, 1956) later adoptedin Pindangan Agricultural Co., Inc. v. Dans (6 SCRA 14) and the later case of One Heart Club, Inc. v.

Court of Appeals (108 SCRA 416) to wit:

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... An appellant who files his brief and submits his case to the Court of Appeals fordecision, without questioning the latter's jurisdiction until decision is rendered therein,should be considered as having voluntarily waives so much of his claim as wouldexceed the jurisdiction of said Appellate Court; for the reason that a contrary rulewould encourage the undesirable practice of appellants submitting their cases fordecision to the Court of Appeals in expectation of favorable judgment, but with intentof attacking its jurisdiction should the decision be unfavorable. ...

Thus, by presenting his claim voluntarily before the City Court of Cebu, the defendant-appelleesubmitted the same to the jurisdiction of the court. He became bound thereby. The amount ofP10,000.00 being the jurisdictional amount assigned the City Court of Cebu, whose jurisdiction thedefendant-appellee has invoked, he is thereby deemed to have waived the excess of his claimbeyond P10,000.00. It is as though the defendant-appellee had set up a counterclaim in the amountof P10,000.00 only. May the Court of First Instance then, on appeal, award defendant-appellee'scounterclaim beyond that amount?

The rule is that a counterclaim not presented in the inferior court cannot be entertained in the Courtof First Instance on appeal (Francisco, The Revised Rules of Court in the Philippines, Vol. III, p. 26,citing the cases of Bernardo v. Genato, 11 Phil. 603 and Yu Lay v. Galmes, 40 Phil. 651). Asexplained in Yu Lay v. Galmes"Upon an appeal to a court of first instance from the judgment of a

justice of the peace, it is not possible, without changing the purpose of the appeal, to alter the nature

of the question raised by the complaint and the answer in the original action. There can be no doubt,therefore, of the scope of the doctrine laid down in the several decisions of the Court. Consequently,We hold that, upon an appeal to the Court of First Instance, the plaintiff as well as the defendantcannot file any pleading or allegation which raises a question essentially distinct from that raised anddecided in the justice of the peace court. "This rule was reiterated in cases from Ng Cho Cio v. NgDiong (1 SCRA 275) to Development Bank of the Philippines v. Court of Appeals (116 SCRA 636).

Thus, the defendant-appellee's counterclaim beyond P10,000.00, the jurisdictional amount of the cityCourt of Cebu, should be treated as having been deemed waived. It is as though it has never beenbrought before trial court. It may not be entertained on appeal.

The amount of judgment, therefore, obtained by the defendant-appellee on appeal, cannot exceed

the jurisdiction of the court in which the action began. Since the trial court did not acquire jurisdictionover the defendant's counterclaim in excess of the jurisdictional amount, the appellate court,likewise, acquired no jurisdiction over the same by its decisions or otherwise. Appellate jurisdictionbeing not only a continuation of the exercise of the same judicial power which has been executed inthe court of original jurisdiction, also presupposes that the original and appellate courts are capableof participating in the exercise of the same judicial power (See 2 Am. Jur. 850; Stacey CheeseCompany v. R.E. Pipkin, Appt. 155 NC 394, 71 S.E. 442, 37 LRA 606) It is the essential criterion ofappellate jurisdiction that it revises and corrects the proceedings in a cause already instituted, and


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of P20,000. The Court of Appeals dismissed the counterclaim for lack of jurisdiction, hence, thispetition for review by the lessee, Adelfo Maceda.

The leased property originally belonged to the spouses Arturo Victoria and Maxima Monserrat, amaternal aunt of the petitioner. After the spouses emigrated to the U.S. in 1970, they leased theirhouse and lot in San Juan, Metro Manila, to the petitioner for P200 per month in 1970. As the house

was old and run down, petitioner proposed to have it repaired and renovated subject toreimbursement of his expenses. The lessors allowed him to do so (Exh. 3) and requested him tosend them pictures of the work accomplished (Exh. 3-a). He made extensive repairs, tearing downrotten parts of the house, rebuilding and extending it up to the garage which he converted into adining room. He also moved the bathrooms around. The remodelling job cost P40,000. His aunt anduncle were pleased with the pictures of the remodelled house and made plans to reimburse him forhis expenditures. But Maceda did not stop there. In what appears to be an orgy of building, heintroduced more improvements. He constructed a new driveway, a basketball court and raised theground level near the creek, elevated the fence, remodelled the gate, and landscaped the lawn.

In 1972, Arturo Victoria passed away in the United States. In 1973, his aunt's attorney-in-fact, Atty.Rustico Zapata, Sr., promised to sell the property to him for P125,000 after the title should havebeen transferred to his widowed aunt. On February 12, 1974, Atty. Zapata and a Mr. Gomez visitedthe place and informed him that his aunt had sold the property to Mrs. Gomez so he should vacate it.He refused to leave. As a result, Atty. Zapata filed an ejectment case against him on April 4, 1974, inthe Municipal Court of San Juan, Rizal (Civil Case No. 3773). lwph1.tIt was dismissed on the plaintiffs ownmotion.

In November 1974, Atty. Zapata informed the petitioner that the property had been sold to PabloZubiri for P145,000. He was asked to vacate it. Again, he refused. Zubiri filed an ejectment caseagainst am (Civil Case No. 37781) in the Municipal Court of San Juan, Rizal. Petitioner insisted thathe was entitled to retain possession of the premises until his expenses were duly reimbursed to him.The complaint was dismissed for failure to prosecute.

In 1978 Maxima Monserrat died in the United States.

On December 4, 1981, the property was sold by Zubiri to Cement Center, Inc. which obtained TCTNos. 30844 to 30845 for the property. The president of the company inspected the premises.Maceda was asked to vacate the property because the company would build a housing project on itfor its employees. Maceda insisted on being reimbursed for his improvements as the original ownershad promised to do. Formal demands to vacate and for payment of P4,000 monthly rental from April15, 1982 were sent to him by the company. On January 17, 1984, another ejectment suit was filedagainst him in the Metropolitan Trial Court of San Juan, Metro Manila.

In his answer to the complaint, Maceda set up a counterclaim for P240,000, the alleged value of hisimprovements.

In its decision, the Metropolitan Trial Court ordered him to vacate the premises and pay the plaintiffP2,000 per month as reasonable compensation for his use of the premises until he actually vacates,and P5,000 as attorney's fees. It ordered the plaintiff to pay the defendant P158,000 as the value ofhis improvements and repairs, less his accrued rentals of P64,000 as of December 1985 and thesum of P12,000 which he had earlier received as partial reimbursement.

Both parties appealed to the Regional Trial Court. The Regional Trial Court set aside the inferiorcourt's decision. On May 19, 1987, it dismissed the ejectment complaint, and ordered Cement


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jurisdiction. The jurisdiction of the Metropolitan Trial Court in a civil action for sum of money(Maceda's counterclaim for the value of his improvements is one such action) is limited to a demandthat "does not exceed twenty thousand pesos exclusive of interest and costs but inclusive ofdamages of whatever kind." (Sec. 33, subpar. 1, B.P. Blg. 129.) A counterclaim in the municipal orcity court beyond that jurisdictional limit may be pleaded only by way of defense to weaken theplaintiffs claim, but not to obtain affirmative relief. (Agustin vs. Bacalan, 135 SCRA 340).

Maceda was not a possessor in good faith, i.e., one who possesses in concept of an owner, hencehe had no right to retain possession of the leased premises pending reimbursement of hisimprovements thereon. No mere lessee can claim to be a possessor in good faith. (Art. 546, CivilCode; Eusebio vs. IAC, 144 SCRA 154; Laureano vs. Adil, 72 SCRA 148.)

The promise of the now deceased spouses Arturo Victoria and Maxima Monserrat, to reimburseMaceda for his improvements was limited only to the initial remodelling job which cost P40,000,pictures of which he sent to the Victorias and which they approved and promised to reimburse. Nosimilar promise to pay may be implied with regard to the additional improvements which he madewithout their approval and which were evidently intended to improve them out of their property.

In any event, since the undertaking of the Victorias to reimburse Maceda for the P40,000 worth ofimprovements which he introduced on their property was not recorded on their title, that promise didnot encumber the property nor bind the purchaser thereof or the successor-in-interest of theVictorias (Mun. of Victorias vs. CA, 149 SCRA 32). lwph1.t

While it is true that under B.P. Blg. 877 a lessee may not be ejected on account of the sale ormortgage of the leased premises, the new owner's need of the premises for the construction ofdwellings for its employees, coupled with the lessee's failure to pay the rentals since December1981, are, to our mind, a legitimate ground for the judicial ejectment of the lessee.

Maceda's original rental of P200 per month could not be increased by the new owner, CementCenter, when it acquired the property on December 5, 1981 until B.P. Blg. 25 allowed a cumulativeand compounded 10% yearly increase effective April 15,1982, and a 20% increase effective April 15,

1985, pursuant to B.P. Blg. 867 and 887 and R.A. 6643. Based on those guidelines, the rentals duefrom Maceda from December 4, 1981 were as follows:

Per Month Total

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

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

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

Per Month Total


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April 15, 1984 to April 14, 1985 P 266.20 P 3,194.40

+20%- April 15, 1985 to April 14, 1986 319.44 3,833.28

April 15, 1986 to April 14, 1987 383.32 4,599.84

April 15, 1987 to April 14, 1988 459.98 5,519.75

April 15, 1988 to April 14, 1989 551.97 6,623.64

April 15, 1989 to August 14, 1989 662.36 2,649.44

P32,864.36

WHEREFORE, the petition for review is granted with respect to the computation of the rentals duefrom the petitioner. He is ordered to pay the unpaid rentals of P32,864.36 for his occupancy of theprivate respondent's property from December 1981 to August 14, 1989 plus P662.36 monthlythereafter until he vacates the premises. The dismissal of his counterclaim for the value of hisimprovements is affirmed. No pronouncement as to costs.

SO ORDERED.

Narvasa, Cruz, Gancayno, and Medialdea, JJ., concur.

G.R. No. 85740 November 9, 1990

MANUEL P. PARCON, petitioner,vs.HON. COURT OF APPEALS, HON. NICOLAS SIAN MONTEBLANCO, in his capacity asPresiding Judge of Branch XXXI, RTC, Iloilo, JESSIE E. BILLENA, ALFREDO T. JAVELLANA,PRODUCERS BANK OF THE PHILIPPINES, respondents.

Sixto P. Demaisip for petitioner.

Nicolas P. Sonalan for Producers Bank of the Phil.

Tinga, Fuentes & Tagle Law Firm for J. Billena and A. Javellana.

PARAS, J .:


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the Supreme Court issued Administrative Order No. 7 defining the territorial jurisdiction ofevery regional trial court. As later amended by Supreme Court Administrative Order No. 67,the territorial jurisdiction of Branches III to VII of the Regional Trial Court of First JudicialRegion, with seat in the City of Baguio, extends over the City of Baguioalone, while that ofBranches VIII to X of the same court, with seat in La Trinidad, Benguet, covers all thethirteen (13) municipalities of Benguet province, namely, Atok, Bokod, Buguias, Itogon,

Kabayan, Mankayan, Sablan, Tuba, Bakun, Kapanggan, Kibungan, La Trinidad, and Tublay.

The action for injunction filed by the private respondents is a civil action in which the subject of thelitigation is incapable of pecuniary estimation, hence, the regional trial court has exclusive original

jurisdiction over it (Sec. 19, B.P. Blg. 129). It is also apersonalaction because it does not affect thetitle to, or possession of real property, nor asks for the partition, condemnation, or foreclosure ofmortgage on real property. As such, it may be commenced and tried where the defendant or any ofthe defendants resides, or may be found, or where the plaintiffs or any of the plaintiffs resides, at theelection of the plaintiff (Sec. 2[b], Rule 4, Rules of Court).

Since two of the plaintiffs in Civil Case No. 90-CV-0541Drs. Felipe Tabanda, Jr. and Rosann Sta.Cruzare residents of La Trinidad, Benguet (par. 1, Complaint), the complaint could properly befiled in the Regional Trial Court at La Trinidad, Benguet. That choice of venue is sanctioned by Sec.2(b), Rule 4 of the Rules of Court. It does not matter that Drs. Tabanda and Sta. Cruz are only twoamong thirty-six (36) plaintiffs. It is of no moment that, according to the petitioner, Dr. Tabanda, anemployee of the Benguet Corporation, is not a real party in interest, and that Dr. Sta. Cruz, aresident physician of NDLH,has no cause of action against the said hospital because she has beenassured that a certificate of residency will be issued to her even if the defendant closes its hospital.What determines jurisdiction and venue are the allegations of the complaint, not the allegations indefendant's answer (People vs. Grospe, 157 SCRA 154; Ching vs. Malaya, 153 SCRA 412).

Since the First Judicial Region consists of the provinces of Abra, Benguet, Ilocos Norte, Ilocos Sur,La Union, Mountain Province, and Pangasinan, and the cities of Baguio, Dagupan, Laoag, and SanCarlos (Sec. 13, B.P. Blg. 129), a writ of injunction issued by the regional trial court sitting in LaTrinidad, Benguet, is enforceable in the City of Baguio. Section 21, sub-paragraph 1, B.P. Blg. 129

provides:

Sec. 21. Original jurisdiction in other cases.Regional Trial Courts shall exerciseoriginal jurisdiction:

(1) In the issuance of writs of certiorari, prohibition, mandamus, quowarranto, habeas corpusandinjunctionwhich may be enforced in any part of theirrespective regions: . . . (Emphasis supplied.)

Clearly, the Regional Trial Court, Branch VIII, in La Trinidad, Benguet, did n

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