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Jurisdiction over Subject matter
[G.R. No. 103200. August 31, 1994.]
LA NAVAL DRUG CORPORATION, petitioner, vs. THE HONORABLE COURT OF APPEALS and WILSON C. YAO,
respondents. SYLLABUS 1. REMEDIAL LAW; REPUBLIC ACT NO. 876; ARBITRATORS, HOW
GOVERNED; CASE AT BAR. Arbitration, in particular, is governed
by a special law, Republic Act 876, suppletory to which are laws and
rules of general application. This case before us concerns the
jurisdiction of courts, in relation to the provisions of Section 6 of
Republic Act No. 876, and, in that respect, the applicability of the
doctrine of estoppel.
2. ID.; CIVIL PROCEDURE; JURISDICTION OVER THE PERSON;
LACK OF; DEFENSE THEREOF, HOW WAIVED. The lack of
jurisdiction over the person of the defendant may be waived either
expressly or impliedly. When a defendant voluntarily appears, he is
deemed to have submitted himself to the jurisdiction of the court. If
he so wishes not to waive this defense, he must do so seasonably by
motion for the purpose of objecting to the jurisdiction of the court;
otherwise, he shall be deemed to have submitted himself to that
jurisdiction. The decisions promulgated heretofore by this Court
would likewise seemingly apply estoppel to bar the defendant from
pursuing that defense by alleging in his answer any other issue for
dismissing the action. 3. ID.; ID.; ID.; ID.; ESTOPPEL; INVOKED ONLY IN HIGHLY
EXCEPTIONAL CASES. The doctrine of estoppel is predicated on,
and has its origin in, equity which, broadly defined, is justice
according to natural law and right. It is a principle intended to avoid
a clear case of injustice. The term is hardly distinguishable from a
waiver of right. Estoppel, like its said counterpart, must be
unequivocal and intentional for, when misapplied, it can easily
become a most convenient and effective means of injustice. Estoppel
is not understood to be a principle that, as a rule, should prevalently
apply but, such as it concededly is, as a mere exception from the
standard legal norms of general application that can be invoked only
in highly exceptional and justifiable cases.
4. ID.; ID.; ID.; ID.; ID.; ASSERTION OF AFFIRMATIVE DEFENSE
ALONG WITH OBJECTION TO COURT'S JURISDICTION OVER THE
PERSON, NOT A CASE OF. The submission of other issues in a
motion to dismiss, or of an affirmative defense (as distinguished from
an affirmative relief) in an answer, would necessarily foreclose, and
have the effect of a waiver of, the right of a defendant to set up the
court's lack of jurisdiction over the person of the defendant. . . . In
the same manner that a plaintiff may assert two or more causes of
action in a court suit, a defendant is likewise expressly allowed,
under Section 2, Rule 8, of the Rules of Court, to put up his own
defenses alternatively or even hypothetically. Indeed, under Section
2, Rule 9, of the Rules of Court, defenses and objections not pleaded
either in a motion to dismiss or in an answer, except for the failure
to state a cause of action, are deemed waived. We take this to mean
that a defendant may, in fact, feel enjoined to set up, along with his
objection to the court's jurisdiction over his person, all other possible
defenses. It thus appears that it is not the invocation of any of such
defenses, but the failure to so raise them, that can result in waiver
or estoppel. By defenses, of course, we refer to the grounds provided
for in Rule 16 of the Rules of Court that must be asserted in a motion
to dismiss or by way of affirmative defenses in an answer. 5. ID.; ID.; JURISDICTION OVER THE SUBJECT MATTER, LACK
OF; EFFECTS THEREOF. Lack of jurisdiction over the subject
matter of the suit is yet another matter. Whenever it appears that the
court has no jurisdiction over the subject matter, the action shall be
dismissed (Section 2, Rule 9, Rules of Court). This defense may be
interposed at any time, during appeal (Roxas vs. Rafferty, 37 Phil.
957) or even after final judgment (Cruzcosa vs. Judge Concepcion, et
al., 101 Phil. 146). Such is understandable, as this kind of
jurisdiction is conferred by law and not within the courts, let alone
the parties, to themselves determine or conveniently set aside.
6. ID.; ID.; JURISDICTION OVER THE NATURE OF THE ACTION,
LACK OF; EFFECTS THEREOF. Lack of jurisdiction over the
nature of the action is the situation that arises when a court, which
ordinarily would have the authority and competence to take a case,
is rendered without it either because a special law has limited the
exercise of its normal jurisdiction on a particular matter or because
the type of action has been reposed by law in certain other courts
or quasi-judicial agencies for determination. Nevertheless, it can
hardly be questioned that the rules relating to the effects of want of
jurisdiction over the subject matter should apply with equal vigor
to cases where the court is similarly bereft of jurisdiction over the
nature of the action. 7. ID.; ID.; ID.; ID.; CASE AT BENCH. In the case at bench, the
want of jurisdiction by the court is indisputable, given the nature of
the controversy. The arbitration law explicitly confines the court's
authority only to pass upon the issue of whether there is or there is
no agreement in writing providing for arbitration. In the affirmative,
the statute ordains that the court shall issue an order "summarily
directing the parties to proceed with the arbitration in accordance
with the terms thereof." If the court, upon the other hand, finds that
no such agreement exists, "the proceeding shall be dismissed." The
proceedings are summary in nature.
8. ID.; ID.; SUMMARY OF RULES RELATING TO EFFECTS OF
WANT OF JURISDICTION BY THE COURT. In summary, it is our considered view, as we now so hereby
express, that (1) Jurisdiction over the person must be seasonably
raised, i.e., that it is pleaded in a motion to dismiss or by way of an
affirmative defense in an answer. Voluntary appearance shall be
deemed a waiver of this defense. The assertion, however, of
affirmative defenses shall not be construed as an estoppel or as a
waiver of such defense. (2) Where the court itself clearly has no
jurisdiction over the subject matter or the nature of the action, the
invocation of this defense may be done at any time. It is neither for
the courts nor the parties to violate or disregard that rule, let alone
to confer that jurisdiction, this matter being legislative in character.
Barring highly meritorious and exceptional circumstances, such as
hereinbefore exemplified, neither estoppel nor waiver shall apply. D E C I S I O N VITUG, J p: In an effort to declog the courts of an increasing volume of work load
and, most importantly, in order to accord contending parties with
expeditious alternatives for settling disputes, the law authorizes,
indeed discourages, out of court settlements or adjudications.
Compromises and arbitration are widely known and used as such
acceptable methods of resolving adversarial claims. Arbitrations, in particular, is governed by a special law, Republic Act
876, suppletory to which are laws and rules of general application.
This case before us concerns the jurisdiction of courts, in relation to
the provisions of Section 6 of Republic Act No. 876, and, in that
respect, the applicability of the doctrine of estoppel. The law (R.A.
876), specifically Section 6 thereof, provides: cdrep
"Sec. 6. Hearing by court. A party aggrieved by the failure, neglect
or refusal of another to perform under an agreement in writing
providing for arbitration may petition the court for an order directing
that such arbitration proceed in the manner provided for in such
agreement. Five days notice in writing of the hearing of such
application shall be served either personally or by registered mail
upon the party in default. The court shall hear the parties, and upon being satisfied
that the making of the agreement or such failure to comply therewith
is not in issue, shall make an order directing the parties to proceed
to arbitration in accordance with the terms of the agreement. If the
making of the agreement or default be in issue the court shall
proceed to summarily hear such issue. If the finding be that no
agreement in writing providing for arbitration was made, or that
there is no default in the proceeding thereunder, the proceeding shall
be dismissed. If the finding be that a written provision for arbitration
was made and there is a default in proceeding thereunder, an order
shall be made summarily directing the parties to proceed with the
arbitration in accordance with the terms thereof. "The court shall decide all motions, petitions or application filed under the provisions of this Act, within ten days after such motions, petitions, or applications have been heard by it." In chronology, the events that have led to the case at bench are detailed in the appealed decision of respondent appellate court, which we here reproduce in toto.
"Original action for Certiorari and Prohibition for Annulment of the
Orders, dated April 26, 1990 and June 22, 1990, respectively, of
Branch LXI, Regional Trial Court, Angeles City, in Special Case No.
6024 for Enforcement of ARBITRATION Agreement with Damages.
Petitioner assails that portion of subject Order of April 26, 1990,
stating as follows: "'(1) Petitioner's claim for damages predicated on alleged tortuous
acts of respondents La Naval Drug corporation such as their alleged
interference and dilatory tactics, etc. in the implementation of the
Arbitration Agreement in the Contract of Lease, thereby compelling
among others the petitioner to go to Court for redress; and
respondent La Naval Drug Corporation's counterclaim for damages
may be entertained by this Court in a hearing - not summary - for
the purpose, under the Rules of Court. '(2) A preliminary hearing of the special and affirmative defense to
show that Petitioner has no cause of action against respondent's
claim for damages is denied; a resolution on this issue deferred
after the trial of the case on the merits.' And challenges the Order of June 22, 1990 denying its motion for reconsideration of the said earlier Order. "From the petition below of respondent Yao, it appears that he is the
present owner of a commercial building a portion of which is leased
to petitioner under a contract of lease executed on December 23,
1983 with the former owner thereof, La Proveedora, Inc., which
contract expired on April 30, 1989. However, petitioner exercised its
option to lease the same building for another five years. But
petitioner and respondent Yao disagreed on the rental rate, and to
resolve the controversy, the latter, thru written notices to the former,
expressed his intention to submit their disagreement to arbitration,
in accordance with Republic Act 876, otherwise known as the
Arbitration Law, and paragraph 7 of their lease contract, providing
that:
"'7. . . . Should the parties fail to agree on the rate of rentals, the same shall be submitted to a group of Arbitrators composed of three (3) members, one to be appointed by LESSOR, another by LESSEE and the third one to be agreed upon by the two arbitrators previously chosen and the parties hereto shall submit to the decision of the arbitrators.' "Thus, on May 6, 1989, respondent Yao appointed Domingo
Alamarez, Jr. as his arbitrator, while on June 5, 1989, petitioner
chose Atty. Casiano Sabile as its arbitrator. The confirmation of the
appointment of Aurelio Tupang, as third arbitrator, was held in
abeyance because petitioner instructed Atty. Sabile to defer the same
until its Board of Directors could convene and approve Tupang's
appointment. Respondent Yao theorizes that this was petitioner's
design to delay the arbitration proceedings, in violation of the
Arbitration Law, and the governing stipulations of their contract of
lease. "On the basis of the aforesaid allegations, respondent Yao prayed
that after summary hearing pursuant to Section 6 of the Arbitration
Law, Atty. Casiano Sabile and Domingo Alamarez be directed to
proceed with the arbitration in accordance with Section 7 of subject
Contract of Lease and the applicable provisions of the Arbitration
Law, by appointing and confirming the appointment of the Third
Arbitrator; and that the Board of Three Arbitrators be ordered to
immediately convene and resolve the controversy before it, pursuant
to Section 12 and the succeeding sections of the Arbitration Law.
(Annex 'A,' Petition.).
"In its Answer with Counterclaim (Annex 'C,' Petition), petitioner here
specifically denied the averments of the petition below; theorizing
that such petition is premature since respondent Yao has not yet
formally required arbitrators Alamarez and Sabile to agree on the
third arbitrator, within ten (10) days from notice, and that the delay
in the arbitration was due to respondent Yao's failure to perform
what is incumbent upon him, of notifying and thereafter, requiring
both arbitrators to appoint the third member of the Board of
Arbitrators. According to petitioner, it actually gave arbitrators
Sabile and Alamarez a free hand in choosing the third arbitrator;
and, therefore, respondent Yao has no cause of action against it
(petitioner). By way of Counterclaim, petitioner alleged that it
suffered actual damages of P100,000.00; and incurred attorney's
fees of P50,000.00, plus P500.00 for every court appearance of its
counsel. "On October 20, 1989, respondent Yao filed an amended petition for
'Enforcement of Arbitration Agreement with Damages;' praying that
petitioner be ordered to pay interest on the unpaid rents, at the
prevailing rate of interest in commercial banks, and exemplary
damages of at least P250,000.00. "On October 24, 1989, despite petitioner's opposition to the motion to admit the amended petition, the respondent court admitted the same. "On October 31, 1989, petitioner answered the amended petition;
contending, among others, that the amended petition should be
dismissed on the ground of non-payment of the requisite filing fees
therefor; and it being in the nature of an ordinary civil action, a full
blown and regular trial is necessary; so that respondent Yao's
proposition for a summary hearing of the arbitration issue and
separate trial for his claim for damages is procedurally untenable
and implausible.
"Invoking Section 5, Rule 16 of the Rules of Court, petitioner
presented a 'Motion to Set Case for Preliminary Hearing' of its
special and affirmative defenses, which are grounds for a motion to
dismiss.
"In its Order of November 14, 1989, the respondent court announced
that the two arbitrators chose Mrs. Eloisa R. Narciso as the third
arbitrator. And on November 21, 1989, it ordered the parties to
submit their position papers on the issue as to whether or not
respondent Yao's claim for damages may be litigated upon in the
summary proceeding for enforcement of arbitration agreement. It
likewise informed the parties that petitioner's 'Motion to Set Case for
Preliminary Hearing' of Special and Affirmative Defenses would be
resolved together with the question of damages. "On April 26, 1990, the aforequoted assailed Order issued. In moving
for reconsideration of the said Order, petitioner argued that in
Special Case No. 6024, the respondent court sits as a special court
exercising limited jurisdiction and is not competent to act on
respondent Yao's claim for damages, which poses an issue litigable
in an ordinary civil action. But the respondent court was not
persuaded by petitioner's submission. On June 22, 1990, it denied
the motion for reconsideration." (Rollo, pp. 89-93).
While the appellate court has agreed with petitioner that, under
Section 6 of Republic Act No. 876, a court, acting within the limits of
its special jurisdiction, may in this case solely determine the issue of
whether the litigants should proceed or not to arbitration, it,
however, considered petitioner in estoppel from questioning the
competence of the court to additionally hear and decide in the
summary proceedings private respondent's claim for damages, it
(petitioner) having itself filed similarly its own counterclaim with the
court a quo. LLphil
It is hardly disputable that when a court is called upon to exercise
limited and special jurisdiction, that court cannot stray to matters
outside the area of its declared authority or beyond what has been
expressly invested by law (Elumbaring vs. Elumbaring, 12 Phil.
384, 387), particularly, such as in this instance, where the
proceedings are summary in nature.
Prefatorily, recalling the distinctions, pertinent to the case, between
the court's lack of jurisdiction over the person of the defendant, on
the one hand, and its lack of jurisdiction over the subject matter or
the nature of the action, upon the other hand, should be useful. The lack of jurisdiction over the person of the defendant may be
waived either expressly or impliedly. When a defendant voluntarily
appears, he is deemed to have submitted himself to the jurisdiction
of the court. If he so wishes not to waive this defense, he must do so
seasonably by motion for the purpose of objecting to the jurisdiction
of the court; otherwise, he shall be deemed to have submitted himself
to that jurisdiction. The decisions promulgated heretofore by this
Court would likewise seemingly apply estoppel to bar the defendant
from pursuing that defense by alleging in his answer any other issue
for dismissing the action. A citation of a few of our decisions might be apropos. In Wang Laboratories, Inc., vs. Mendoza (156 SCRA 44), this Court
has ruled that if the defendant, besides setting up in a motion to
dismiss his objection to the jurisdiction of the court, alleges at the
same time any other ground for dismissing the action, he is
deemed to have submitted himself to the jurisdiction of the court.
In the process, it has equated the matter to a situation where, such
as in Immaculata vs. Judge Navarro, et al. (146 SCRA 5), the
defendant invokes an affirmative relief against his opponent.
In De Midgely vs. Judge Ferandos (64 SCRA 23, 31), the Court elaborated thusly: "We are of the opinion that the lower court has acquired jurisdiction
over the person of Mrs. Midgely by reason of her voluntary
appearance. The reservation in her motion to dismiss that she was
making a special appearance to contest the court's jurisdiction over
her person may be disregarded. "It may be disregarded because it was nullified by the fact that in
her motion to dismiss she relied not only on the ground of lack of
jurisdiction over her person but also on the ground that there was
no showing that earnest efforts were exerted to compromise the
case and because she prayed 'for such other relief as' may be
deemed 'appropriate and proper.' "xxx xxx xxx "When the appearance is by motion for the purpose of objecting to
the jurisdiction of the court over the person, it must be for the sole
and separate purpose of objecting to the jurisdiction of the court. If
his motion is for any other purpose than to object to the jurisdiction
of the court over his person, he thereby submits himself to the
jurisdiction of the court. A special appearance by motion made for
the purpose of objecting to the jurisdiction of the court over the
person will be held to be a general appearance, if the party in said
motion should, for example, ask for a dismissal of the action upon
the further ground that the court had no jurisdiction over the subject
matter. (Syllabus, Flores vs. Zurbito, supra, at page 751. That rule
was followed in Ocampo vs. Mina and Arejola, 41 Phil. 308)." The justification for the rule was expressed in Republic vs. Ker and Company, Ltd. (18 SCRA 207, 213-214), in this wise: llcd "We observe that the motion to dismiss filed on April 14, 1962, aside
from disputing the lower court's jurisdiction over defendant's
person, prayed for dismissal of the complaint on the ground that
plaintiff's cause of action has prescribed. By interposing such
second ground in its motion to dismiss, Ker & Co., Ltd. availed of an
affirmative defense on the basis of which it prayed the court to
resolve controversy in its favor. For the court to validly decide the
said plea of defendant Ker & Co., Ltd., it necessarily had to acquire
jurisdiction upon the latter's person, who, being the proponent of
the affirmative defense, should be deemed to have abandoned its
special appearance and voluntarily submitted itself to the
jurisdiction of the court. "Voluntary appearance cures defects of summons, if any. Such
defect, if any, was further cured when defendant filed its answer to
the complaint. A defendant can not be permitted to speculate upon
the judgment of the court by objecting to the court's jurisdiction
over its person if the judgment is adverse to it, and acceding to
jurisdiction over its person if and when the judgment sustains its
defenses." The doctrine of estoppel is predicated on, and has its origin in, equity
which, broadly defined, is justice according to natural law and right.
It is a principle intended to avoid a clear case of injustice. The term
is hardly distinguishable from a waiver of right. Estoppel, like its
said counterpart, must be unequivocal
and intentional for, when misapplied, it can easily become a most
convenient and effective means of injustice. Estoppel is not
understood to be a principle that, as a rule, should prevalently apply
but, such as it concededly is, as a mere exception from the standard
legal norms of general application that can be invoked only in highly
exceptional and justifiable cases. Tested by the above criteria, the Court sees it propitious to re-
examine specifically the question of whether or not the submission
of other issues in a motion to dismiss, or of an affirmative defense
(as distinguished from an affirmative relief) in an answer, would
necessarily foreclose, and have the effect of a waiver of, the right of
a defendant to set up the court's lack of jurisdiction over the person
of the defendant. LLpr Not inevitably. Section 1, Rule 16, of the Rules of Court, provides that a motion to dismiss may be made on the following grounds: "(a) That the court has no jurisdiction over the person of the defendant or over the subject of the action or suit; "(b) That the court has no jurisdiction over the nature of the action or suit; "(c) The venue is improperly laid; "(d) That the plaintiff has no legal capacity to sue; "(e) That there is another action pending between the same parties for the same cause; "(f) That the cause of action is barred by a prior judgment or by statute of limitations; "(g) That the complaint states no cause of action; "(h) That the claim or demand set forth in the plaintiff's pleading has been paid, waived, abandoned,
or otherwise extinguished; "(i) That the claim on which the action or suit is founded is unenforceable under the provisions of the statute of frauds; "(j) That the suit is between members of the same family and no earnest efforts towards a compromise have been made." Any ground for dismissal in a motion to dismiss, except improper
venue, may, as further set forth in Section 5 of the same rule, be
pleaded as an affirmative defense and a preliminary hearing may be
had thereon as if a motion to dismiss had been filed. An answer itself
contains the negative, as well as affirmative, defenses upon which
the defendant may rely (Section 4, Rule 6, Rules of Court). A negative
defense denies the material facts averred in the complaint essential
to establish the plaintiff's cause of action, while an affirmative
defense is an allegation of a new matter which, while admitting the
material allegations of the complaint, would, nevertheless, prevent
or bar recovery by the plaintiff. Inclusive of
these defenses are those mentioned in Rule 16 of the Rules of Court which would permit the filing of a motion to dismiss. LLphil In the same manner that a plaintiff may assert two or more causes
of action in a court suit, a defendant is likewise expressly allowed,
under Section 2, Rule 8, of the Rules of Court, to put up his own
defenses alternatively or even hypothetically. Indeed, under Section
2, Rule 9, of the Rules of Court, defenses and objections not pleaded
either in a motion to dismiss or in an answer, except for the failure
to state a cause of action, are deemed waived. We take this to mean
that a defendant may, in fact, feel enjoined to set up, along with his
objection to the court's jurisdiction over his person, all other possible
defenses. It thus appears that it is not the invocation of any of such
defenses, but the failure to so raise them, that can result in waiver
or estoppel. By defenses, of course, we refer to the grounds provided
for in Rule 16 of the Rules of Court that must be asserted in a motion
to dismiss or by way of affirmative defenses in an answer. Mindful of the foregoing, in Signetics Corporation vs. Court of Appeals and Freuhauf Electronics Phil., Inc. (225 SCRA 737, 738), we lately ruled: "This is not to say, however, that the petitioner's right to question the
jurisdiction of the court over its person is now to be deemed a
foreclosed matter. If it is true, as Signetics claims, that its only
involvement in the Philippines was through a passive investment in
Sigfil, which it even later disposed of, and that TEAM Pacific is not
its agent, then it cannot really be said to be doing business in the
Philippines. It is a defense, however, that requires the contravention
of the allegations of the complaint, as well as a full ventilation, in
effect, of the main merits of the case, which should not thus be within
the province of a mere motion to dismiss. So, also, the issue posed
by the petitioner as to whether a foreign corporation which has done
business in the country, but which has ceased to do business at the
time of the filing of a complaint, can still be made to answer for a
cause of action which accrued while it was doing business, is another
matter that would yet have to await the reception and admission of
evidence. Since these points have seasonably been raised by the
petitioner, there should be no real cause for what may
understandably be its apprehension, i.e., that by its participation
during the trial on the merits, it may, absent an invocation of
separate or independent reliefs of its own, be considered to have
voluntarily submitted itself to the court's jurisdiction." Lack of jurisdiction over the subject matter of the suit is yet another
matter. Whenever it appears that the court has no jurisdiction over
the subject matter, the action shall be dismissed (Section 2, Rule
9, Rules of Court). This defense may be interposed at any time,
during appeal (Roxas vs. Rafferty, 37 Phil. 957) or even after final
judgment (Cruzcosa vs. Judge Concepcion, et al., 101 Phil. 146).
Such is understandable, as this kind of jurisdiction is conferred by
law and not within the courts, let alone the parties, to themselves
determine or conveniently set aside. In People vs. Casiano (111 Phil.
73, 93-94), this Court, on the issue of estoppel, held: LibLex "The operation of the principle of estoppel on the question of
jurisdiction seemingly depends upon whether the lower court
actually had jurisdiction or not. If it had no jurisdiction, but the
case was tried and decided upon the theory that it had jurisdiction,
the parties are not barred, on appeal, from
assailing such jurisdiction, for the same 'must exist as a matter of law, and may not be conferred by consent of the parties or by estoppel' (5 C.J.S., 861-863). However, if the lower court had jurisdiction, and the case was heard
and decided upon a given theory, such, for instance, as that the
court had no jurisdiction, the party who induced it to adopt such
theory will not be permitted, on appeal, to assume an inconsistent
position that the lower court had jurisdiction. Here, the principle
of estoppel applies. The rule that jurisdiction is conferred by law,
and does not depend upon the will of the parties, has no bearing
thereon." The rule was reiterated in Calimlim vs. Ramirez (118 SCRA 399,
406), and quite recently, in Southeast Asian Fisheries Development
Center-Aquaculture Department vs. National Labor Relations
Commission (206 SCRA 283). Jurisdiction over the nature of the action, in concept, differs from
jurisdiction over the subject matter. Illustrated, lack of jurisdiction
over the nature of the action is the situation that arises when a court,
which ordinarily would have the authority and competence to take a
case, is rendered without it either because a special law has limited
the exercise of its normal jurisdiction on a particular matter or
because the type of action has been reposed by law in certain other
courts or quasi-judicial agencies for determination. Nevertheless, it
can hardly be questioned that the rules relating to the effects of want
of jurisdiction over the subject matter should apply with equal vigor
to cases where the court is similarly bereft of jurisdiction over the
nature of the action. LibLex In summary, it is our considered view, as we now so hereby express, that (1) Jurisdiction over the person must be seasonably raised, i.e.,
that it is pleaded in a motion to dismiss or by way of an affirmative
defense in an answer. Voluntary appearance shall be deemed a
waiver of this defense. The assertion, however, of affirmative
defenses shall not be construed as an estoppel or as a waiver of
such defense. (2) Where the court itself clearly has no jurisdiction over the
subject matter or the nature of the action, the invocation of this
defense may be done at any time. It is neither for the courts nor the
parties to violate or disregard that rule, let alone to confer that
jurisdiction, this matter being legislative in character. Barring highly
meritorious and exceptional circumstances, such as hereinbefore
exemplified, neither estoppel nor waiver shall apply. In the case at bench, the want of jurisdiction by the court is
indisputable, given the nature of the controversy. The arbitration
law explicitly confines the court's authority only to pass upon the
issue of whether there is or there is no agreement in writing
providing for arbitration. In the affirmative, the statute ordains that
the court shall issue an order "summarily directing the parties to
proceed with the arbitration in accordance with the terms thereof."
If the court, upon the other hand, finds that no such agreement
exists, "the proceeding shall be dismissed." The proceedings are
summary in nature. All considered, the court a quo must then refrain from taking up the claims of the contending parties for damages, which, upon the other hand, may be ventilated in separate regular proceedings at an
opportune time and venue. The circumstances obtaining in this case are far, we hold, from justifying the application of estoppel against either party. cdll WHEREFORE, the decision of the Court of Appeals and the orders
of the trial court in question are SET ASIDE. The court a quo, in
the instant proceedings, is ordered to DESIST from further hearing
private respondent's claim, as well as petitioner's counterclaim, for
damages. No costs. SO ORDERED. FIRST DIVISION [G.R. No. 47517. June 27, 1941.] IDONAH SLADE PERKINS, petitioner, vs. MAMERTO ROXAS, ET AL., respondents. Alva J. Hill for petitioner. DeWitt, Perkins & Ponce Enrile for respondent Judge and respondent Perkins. Ross, Lawrence, Selph & Carrascoso, Jr., for respondent Benguet Consolidated Mining Co. SYLLABUS 1. COURTS; MEANING OF JURISDICTION OVER SUBJECT
MATTER; ADJUDICATION OF TITLE TO CERTAIN SHARES OF
STOCK. By jurisdiction over the subject matter is meant the
nature of the cause of action and of the relief sought, and this is
conferred by the sovereign authority which organizes the court, and
is to be sought for in the general nature of its power, or in authority
specially conferred. The respondent's action calls for the
adjudication of title to certain shares of stock of the Benguet
Consolidated Mining Company, and the granting of affirmative
reliefs, which fall within the general jurisdiction of the Court of First
Instance of Manila. (Vide sec. 146, et seq., Adm. Code, as amended
by Comm. Act No. 145; sec 56, Act No. 136, as amended by Act No.
400.) 2. ID.; ID.; CROSS-COMPLAINT. I. S. P. in her cross-complaint
brought suit against E. A. P. and the Benguet Consolidated Mining
Company upon the alleged judgment of the Supreme Court of the
State of New York and asked the court below to render judgment
enforcing that New York judgment, and to issue execution thereon.
This is a form of action recognized by section 309 of the Code of Civil
Procedure (now section 47, Rule 39, Rules of Court) and which falls
within the general jurisdiction of the Court of First Instance of
Manila, to adjudicate, settle and determine. 3. ID.; ID.; ID.; Whether or not the respondent judge in the
course of the proceedings will give validity and efficacy to the New
York judgment set up by the petitioner in her cross-complaint is a
question that goes to the merits of the controversy and relates to the
rights of the parties as between each other, and not to the
jurisdiction or power of the court. The test of jurisdiction is whether
or not the tribunal has power to enter upon the inquiry, no whether
its conclusion in the course of it is right or wrong. If its decision is
erroneous, its judgment can be reversed on appeal; but its
determination of the
question, which the petitioner here anticipates and seeks to prevent, is the exercise by the court and the rightful exercise of its jurisdiction. D E C I S I O N LAUREL, J p: On July 5, 1938, the respondent, Eugene Arthur Perkins, filed a
complaint in the Court of First Instance of Manila against the
Benguet Consolidated Mining Company for the recovery of the sum
of P71,379.90, consisting of dividends which have been declared and
made payable on 52,874 shares of stock registered in his name,
payment of which was being withheld by the company, and for the
recognition of his right to the control and disposal of said shares, to
the exclusion of all others. To the complaint, the company filed its
answer, alleging, by way of defense, that the withholding of plaintiff's
right to the disposal and control of the shares was due to certain
demands made with respect to said shares by the petitioner herein,
Idonah Slade Perkins, and by one George H. Engelhard. The answer
prays that the adverse claimants be made parties to the action and
served with notice thereof by publication, and that thereafter all such
parties be required to interplead and settle the rights among
themselves. On September 5, 1938, the trial court ordered the respondent,
Eugene Arthur Perkins, to include in his complaint as parties
defendants petitioner, Idonah Slade Perkins, and George H.
Engelhard. The complaint was accordingly amended and in addition
to the relief prayed for in the original complaint, respondent Perkins
prayed that petitioner Idonah Slade Perkins and George H.
Engelhard be adjudged without interest in the shares of stock in
question and excluded from any claim they assert thereon.
Thereafter, summons by publication were served upon the non-
resident defendants, Idonah Slade Perkins and George H. Engelhard,
pursuant to the order of the trial court. On December 9, 1938,
Engelhard filed his answer to the amended complaint, and on
January 8, 1940, petitioner's objection to the court's jurisdiction over
her person having been overruled by the trial court and by this court
in G. R. No. 46831, petitioner filed her answer with a cross-complaint
in which she sets up a judgment allegedly obtained by her against
respondent, Eugene Arthur Perkins, from the Supreme Court of the
State of the New York, wherein it is declared that she is the sole legal
owner and entitled to the possession and control of the shares of
stock in question together with all the cash dividends declared
thereon by the Benguet Consolidated Mining Company, and prays
for various affirmative reliefs against the respondent. To the answer
and cross-complaint thus filed, the respondent, Eugene Arthur
Perkins, filed a reply and an answer in which he sets up several
defenses to the enforcement in this jurisdiction of the judgment of
the Supreme Court of the State of New York above alluded to. Instead
of demurring to the reply on either of the two grounds specified in
section 100 of the Code of Civil Procedure, petitioner, Idonah Slade
Perkins, on June 5, 1940, filed a demurrer thereto on the ground
that "the court has no jurisdiction of the subject of the action,"
because the alleged judgment of the Supreme Court of the State of
New York is res judicata. Petitioner's demurrer having been overruled, she now filed in this
court a petition entitled "Certiorari, Prohibition and Mandamus,"
alleging that "the respondent judge is about to and will render
judgment in the above-mentioned case disregarding the
constitutional rights of this petitioner; contrary to and
annulling the final, subsisting, valid judgment rendered and entered
in this petitioner's favor by the courts of the State of New York, . . .
which decision is res judicata on all the questions constituting the
subject matter of civil case No. 53317, of the Court of First Instance
of Manila; and which New York judgment the Court of First Instance
of Manila is without jurisdiction of annul, amend, reverse, or modify
in any respect whatsoever"; and praying that the order of the
respondent judge overruling the demurrer be annulled, and that he
and his successors be permanently prohibited from taking any
action on the case, except to dismiss the same. The only question here to be determined, therefore, is whether or not,
in view of the alleged judgment entered in favor of the petitioner by
the Supreme Court of New York, and which is claimed by her to be
res judicata on all questions raised by the respondent, Eugene Arthur
Perkins, in civil case No. 53317 of the Court of First Instance of
Manila, the local court has jurisdiction over the subject matter of the
action in the said case. By jurisdiction over the subject matter is
meant the nature of the cause of action and of the relief sought, and
this is conferred by the sovereign authority which organizes the
court, and is to be sought for in general nature of its powers, or in
authority specially conferred. In the present case, the amended
complaint filed by the respondent, Eugene Arthur Perkins, in the
court below alleged the ownership in himself of the shares of stock
involved in this action as manager of the conjugal partnership
between him and his wife, Idonah Slade Perkins; that the petitioner,
Idonah Slade Perkins; that such claims are invalid, unfounded, and
made only for the purpose of vexing, hindering and delaying Eugene
Arthur Perkins in the exercise of the lawful control over and use of
said amended complaint prays, inter alia, "that defendant Benguet
Consolidated Mining Company be required and ordered to recognize
the right of the plaintiff to the control and disposal of said shares so
standing in his name to the exclusion of all others; that the additional
defendants, Idonah Slade Perkins and George H. Engelhard, be each
held to have no interest or claim in the subject matter of the
controversy between plaintiff and defendant Benguet Consolidated
Mining Company, or in or under the judgment to be rendered herein
and that by the said judgment they, and each of them be excluded
therefrom; and that the plaintiff be awarded the costs of this suit and
general relief." The respondent's action, therefore, calls for the
adjudication of title to certain shares of stock of the Benguet
Consolidated Mining Company, and the granting of affirmative
reliefs, which fall within the general jurisdiction of the Court of First
Instance of Manila. (Vide: sec. 146, et seq., Adm. Code, as amended
by Commonwealth Act No. 145; sec. 56, Act No. 136, as amended by
Act No. 400.) Similarly, the Court of First Instance of Manila is empowered to
adjudicate the several demands contained in petitioner's cross-
complaint. The cross-complaint sets up a judgment allegedly
recovered by Idonah Slade Perkins against Eugene Arthur Perkins
in the Supreme Court of New York and by way of relief prays: "(1) Judgment against the plaintiff Eugene Arthur Perkins in the sum of one hundred eighty-five thousand and four hundred dollars ($185,400), representing cash dividend of March 30, 1937. "(2) That plaintiff Eugene Arthur Perkins be required to deliver to
this defendant the certificates representing the 48,000 shares of
capital stock of Benguet Consolidated Mining Co. issued as a stock
dividend on the 24,000 shares owned by this defendant as
described in the judgment Exhibit 1-A.
"(3) That this defendant recover under that judgment Exhibit
1-A interest upon the amount of each cash dividend referred
to in that judgment received by plaintiff Eugene Arthur Perkins
from February, 1930, to and including the dividend of March
30, 1937, from the date of payment of each of such dividends
at the rate of 7 per cent per annum until paid. "(4) That this defendant recover of plaintiff her costs and
disbursements in that New York action amounting to the sum
of one thousand five hundred eighty-four and 20/000 dollars
($1,584.00), and the further sum of two thousand dollars
($2,000) granted her in that judgment Exhibit 1-A as an extra
allowance, together with interest. "(5) For an order directing an execution to be issued in favor of
this defendant and against the plaintiff for amounts sufficient
to satisfy the New York judgment Exhibit 1-A in its entirety,
and against the plaintiff and the defendant Benguet
Consolidated Mining Co. for such other amounts prayed for
herein as this court may find to be due and payable by each of
them; and ordering them to comply with all other orders which
this court may issue in favor of the defendant in this case. "(6) For the costs of this action, and "(7) For such other relief as may be appropriate and proper in the premises." In other words, Idonah Slade Perkins in her cross-complaint
brought suit against Eugene Arthur perkins and the Benguet
Consolidated Mining Company upon the alleged judgment of
the Supreme Court of the State of New York and asked the court
below to render judgment enforcing that New York judgment,
and to issue execution thereon. This is a form of action
recognized by section 309 of the Code of Civil Procedure (now
section 47, Rule 39, Rules of Court) and which falls within the
general jurisdiction of the Court of First Instance of Manila, to
adjudicate, settle and determine. The petitioner expresses the fear that the respondent judge may
render judgment "annulling the final, subsisting, valid
judgment rendered and entered in this petitioner's favor by the
courts of the State of New York, . . . which decision is res
judicata on all the questions constituting the subject matter of
civil case No. 53317," and argues on the assumption that the
respondent judge is without jurisdiction to take cognizance of
the cause. Whether or not the respondent judge in the course
of the proceedings will give validity and efficacy to the New York
judgment set up by the petitioner in her cross-complaint is a
question that goes to the merits of the controversy and relates
to the rights of the parties as between each other, and not to the
jurisdiction or power of the court. The test of jurisdiction is
whether or not the tribunal has power to enter upon the inquiry,
not whether its conclusion in the course of it is right or wrong.
If its decision is erroneous, its judgment can be reversed on
appeal; but its determination of the question, which the
petitioner here anticipates and seeks to prevent, is the exercise
by that court and the rightful exercise of its jurisdiction. The petition is, therefore, hereby denied, with costs against the petitioner. So ordered. Avancea, C. J., Diaz, Moran and Horrilleno, JJ., concur.
73 Phil 484 Emilio Reyes vs Apolonio Diaz
This case is certified to this Court by the Court of Appeals upon the ground that the jurisdiction of the trial court is in issue. The supposed questions of jurisdiction are, first, whether or not there is sufficient evidence to show that the protestant has duly filed his certificate of candidacy, and second, whether the trial court has or has no authority to pass upon the validity of the ballots adjudicated to the protestant which have not been challenged by the protestee in his counter-protest. Article VIII, section 2, No. 3, of the Constitution confers upon the Supreme Court jurisdiction over all cases in which the jurisdiction of any trial court is in issue. Section 138, No. 3, of the Revised Administrative Code as amended by Commonwealth Acts Nos. 3 and 259, provides that the Supreme Court shall have appellate jurisdiction over all cases in which the jurisdiction of any inferior court is in issue. It has been held that the word jurisdiction as used in the constitutions and in the statutes means jurisdiction as to the subject-matter only, unless an exception arises by reason of its employment in a broader sense. (15 C. J. 735; Johnson vs. Wells, 91 Fed. 1; U. S. vs. Lee, 84 Fed. 626; Vinal vs. Continental Constr., etc. Co., 34 Fed. 228; Starnes vs. Mutual Loan etc., Co., 102 Ga. 597; 29 SE 452.) There is in our Constitution or in the law aforecited nothing which may lend the word jurisdiction therein used a broader meaning than jurisdiction over the subject-matter. On the contrary, having due regard to the manifest purpose of the law, which is to confine the appellate jurisdiction of this Court to cases of vital importance involving questions of fundamental character, such, for instance, as the question of validity of statute, treaty or ordinance, or the legality of any tax, import or assessment which may affect the very existence of the government, or criminal cases wherein life imprisonment or death penalty is imposed, we are of the opinion, and so hold, that the issue of jurisdiction which confers appellate powers
upon this Court in a given case is not such question as is dependent exclusively upon minor matters of fact or upon a mere construction of the pleadings, but that which has reference to the more important question of jurisdiction of the trial court over the subject-matter as determined by law Jurisdiction over the subject-matter is the power to hear and determine cases of the general class to which the proceedings in question belong (C. J. S., p. 36) and is conferred by the sovereign authority which organizes the court and defines its powers (Banco Espaol Filipino vs. Palanca, 37 Phil. 921; Perkins vs. Dizon, 40 Off. Gaz. No. 7, 3d Sup. p. 216; Ng Si Chok vs. Vera, G. R. No. 45674). The question, therefore, of whether a court has jurisdiction over the subject-matter, calls for interpretation and application of the law of jurisdiction which distributes the judicial power among the different courts in the Philippines, and since the ruling on the matter is of far-reaching consequences, affecting, as it may, the very life and structure of our judicial system, the law has deemed it wise to place the power and authority to act thereon in the highest court of the land. In the instant case, there is no such question of jurisdiction as above described. Both parties agree that if the due filing of the protestants certificate of candidacy is proven, the trial court has jurisdiction, but that if such fact is not proven the trial court has no jurisdiction except to dismiss the case. There is, therefore, no question between the parties as to what the jurisdiction of the trial court is according to law in either case. The real question between them is one of fact whether or not the protestants certificate of candidacy has been duly filed. And not until this fact is proved can the question of jurisdiction be determined.
Neither is the second question one of jurisdiction within the purview of the legal provisions above quoted. Whether certain ballots are or are not pertinent to the issue raised in the pleadings, is merely a question of relevancy of evidence. It may be true that the court by an erroneous ruling on such question may encroach upon issues completely foreign to those defined in the pleadings, but in such case the question of jurisdiction that may arise would not be one of jurisdiction over the subject-matter but of jurisdiction over the issue. In order that a court may validly try and decide a case, it must have jurisdiction over the subject-matter and jurisdiction over the persons of the parties. (Banco Espaol Filipino vs. Palanca, 37 Phil. 921; Perkins vs. Dizon, 40 Off. Gaz. No. 7, 3d Sup. p. 216.) But in some instances it is said that the court should also have jurisdiction over the issue (15 C. J. 734; Hutts vs. Martin, 134 Ind. 587, 33 N.E. 676), meaning thereby that the issue being tried and decided by the court be within the issues raised in the pleadings. But this kind of jurisdiction should be distinguished from jurisdiction over the subject-matter, the latter being conferred by law and the former by the pleadings. Jurisdiction over the issue, unlike jurisdiction over the subject-matter, may be conferred by consent either express or implied of the parties. (Rule 17, sec. 4, Rules of Court.) Although an issue is not duly pleaded it may validly be tried and decided if no timely objection is made thereto by the parties. This cannot be done when jurisdiction over the subject-matter is involved. In truth, jurisdiction over the issue is an expression of a principle that is involved in jurisdiction over the persons of the parties. Where, for instance, an issue is not duly pleaded in the complaint, the defendant cannot be said to have been served with process as to that issue. (Cf. Atkins etc. Co. vs. Domingo, 44 Phil. 680). At any rate, whether or not the court has jurisdiction over a specific issue is a question that requires nothing except an examination of the pleadings, and this function is without such importance as to call for the intervention of this Court.
Furthermore, this question of jurisdiction is unsubstantial. It is a well-settled rule that the institution of suffrage is of public, not private, interest, and the court may examine all the ballots after the ballot boxes are opened in order to determine which are legal and which are illegal, even though neither of the parties raised any question as to their illegality. (Yalung vs. Atienza, 52 Phil. 781; Cecilio vs. Tomacruz, 62 Phil. 689; Cosculluela vs. Gaston, 63 Phil. 41). WHEREFORE, this case is hereby remanded to the Court of Appeals for further proceedings. Avancea, C.J., Abad Santos, Diaz, Horrilleno and Ozaeta, JJ., concur. Laurel, J., concurs in the result.