1. BILAG v.

AY-AY

Bernadette S. Bilag, Erlinda Bilag Santillan, Dixon Bilag, Reynaldo B. Suello Heirs of Lourdes S. Bilag, Heirs
of Leticia Bilag-Hanaoka, and heirs of Nellie Bilag vs. Estela Ay-Ay, Andres Acop Jr., Felicitas Ap-Ap, Sergio
Ap-Ap, John Napoleon A. Ramirez Jr., and Ma. Teresa A. Ramirez

G.R. No. 189950

April 24, 2017

Facts:

The instant case stemmed from a complaint for quieting of title with prayer for preliminary injunction
filed by respondents against the petitioners before the RTC Br. 61. Essentially, respondents alleged that
petitioner’s predecessors-in-interest sold to them separately various portions of a 159, 496 square meter
parcel of land designated by the Bureau of Lands situated at Sitio Benin, Baguio City, and they registered
the corresponding Deeds of sale with the Register of Deeds of Baguio City.

Respondents further alleged that they have been in continuous possession of the said lands since 1976
when they were delivered to them and that they have already introduced various improvements
thereon. Petitioners refused to honor the forgoing sales and continued to harass and threatened to
demolish their improvements. Petitioners filed a motion to dismiss on the grounds of lack of jurisdiction,
prescription/laches/estoppel, and res judicata. The RTC ruled in favour of petitioner, ordered the
dismissal of civil case No. 5881-R and dismissing the earlier filed civil case No. 3934-R where respondents
similarly sought to be declared the owners of the subject property. Respondents appealed to the CA, the
CA then set aside the dismissal of the civil case and remanded the case to the court a quo for trial. The
CA concluded that while these cases may involve the same properties, the nature of the action differs;
hence, res judicata is not a bar to the present suit. The CA pointed out that in view of respondent’s
allegation that they have been in possession of the subject property since 1976, their action to quiet title
is imprescriptible.

Issue:
Whether or not the CA gravely erred in setting aside the dismissal of the Civil Case No. 5881-R on the
ground of lack of jurisdiction on the part of the RTC?

Held:

Yes. On the issue of jurisdiction, a review of the records shows that the subject property form part of a
159,496 square meter parcel of land designated by Bureau of Lands situated at Sitio Benin, Baguio City.
Such parcel of land forms part of the Baguio Town site Reservation, a portion of which was awarded to
Iloc Bilag. RTC Br. 61 has no jurisdiction over Civil Case No. 5881-R as the plaintiffs therein seek to quiet
title over lands which belong to the public domain. It should be stressed that the court a qou’s lack of
subject matter jurisdiction over the case renders it without authority and necessarily obviates the
resolution of the merits of the case. To reiterate, when a court has no jurisdiction over the subject
matter, the only power it has is to dismiss the action, as any act it performs without jurisdiction is null
and void, and without any binding legal effects.

2. SPS. HERMINIO E. ERORITA AND EDITHA C. ERORITA v. SPS. LIGAYA DUMLAO AND ANTONIO DUMLAO,
GR No. 195477, 2016-01-15

Facts:

Spouses Antonio and Ligaya Dumlao (Spouses Dumlao) are the registered owners of a parcel of land...
covered by TCT No. T-53000. The San Mariano Academy structures are built on the property.

The Spouses Dumlao bought the property in an extrajudicial foreclosure sale on April 25, 1990. Because
the former owners, Spouses Herminio and Editha Erorita (Spouses Erorita), failed to redeem it, the title
was consolidated in the buyers' name.

The Spouses Dumlao agreed to allow the petitioners to continue to operate the school on the property.
The Spouses Erorita appointed Hernan and Susan Erorita as the San Mariano Academy's administrators.
The Spouses Dumlao alleged that the Eroritas agreed on a monthly rent of Twenty Thousand Pesos
(P20,000.00), but had failed to pay rentals since 1990. The Spouses Erorita countered that the Dumlaos
allowed them to continue to run the school without rental out of goodwill and... friendship.

On December 16, 2002, the Spouses Dumlao asked the petitioners to vacate the property. Although the
Spouses Erorita wanted to comply, they could not immediately close the school without clearance from
the Department of Education, Culture, and Sports to whom they are... accountable.

On March 4, 2004, the Spouses Dumlao filed a complaint for recovery of possession before the Regional
Trial Court (RTC)

In their joint answer, the defendants prayed that the complaint be dismissed because they cannot be
forced to vacate and to pay the rentals under their factual circumstances.

On June 4, 2007, the RTC decided in the Spouses Dumlao's favor.

The defendants Erorita appealed to the CA arguing that the complaint patently shows a case for unlawful
detainer. Thus, the RTC had no jurisdiction over the subject matter of the case.

the CA affirmed the RTC's decision.

The CA ruled that the applicable law on jurisdiction when the complaint was filed, was Republic Act No.
7691[3] (RA 7691). This law provides that in civil actions involving a real property's title or possession,
jurisdiction depends on the property's... assessed value and location - if the assessed value exceeds fifty
thousand pesos (P50,000.00) in Metro Manila, and twenty thousand pesos (P20,000.00) outside of
Metro Manila, the RTC has jurisdiction.

Because the tax declaration showed that the assessed value of the property and its improvements
exceeded P20,000.00, the CA concluded that the RTC had jurisdiction.
Citing Barbosa v. Hernandez,[4] the CA held that this case involves an action for possession of real
property and not unlawful detainer.

Issues:

Whether the RTC had jurisdiction

Ruling:

We hold that... the MTC had jurisdiction

Jurisdiction is based on the allegations in the complaint.

To make a case for unlawful detainer, the complaint must allege that: (a) initially, the defendant lawfully
possessed the property, either by contract or by plaintiffs tolerance; (b) the plaintiff notified the
defendant that his right of possession is... terminated; (c) the defendant remained in possession and
deprived plaintiff of its enjoyment; and (d) the plaintiff filed a complaint within one year from the last
demand on defendant to vacate the property.[8] A complaint for... accion publiciana or recovery of
possession of real property will not be considered as an action for unlawful detainer if any of these
special jurisdictional facts is omitted.[9]

A review of the complaint shows that: (a) the owners, Spouses Dumlao, agreed to allow the petitioners
to continue operating the school on the disputed property; (b) in a demand letter dated February 12,
2004, the Spouses Dumlao told the petitioners to pay and/or vacate... the property; (c) the respondents
refused to vacate the property; and (d) the Spouses Dumlao filed the complaint (March 4, 2004) within a
year from the last demand to vacate (February 12, 2004).

Thus, although the complaint bears the caption "recovery of possession," its allegations contain the
jurisdictional facts for an unlawful detainer case. Under RA 7691, an action for unlawful detainer is
within the MTC's exclusive jurisdiction regardless of the property's... assessed value.[10]

(Another digest for case #2)

Spouses Herminio and Editha Erorita Vs. Spouses Antonio and Ligaya Dumlao

G.R. No. 195477. January 25, 2016

On March 4, 2004, the Spouses DUMLAO filed a complaint for recovery of possession before the
Regional Trial Court (RTC) against the defendants Hernan, Susan, and the Spouses Erorita.

On June 4, 2007, the RTC decided in the Spouses Dumlao’s favor.

On Appeal, ERORITA argued that the complaint patently shows a case for unlawful detainer. Thus, the
RTC had no jurisdiction over the subject matter of the case

1. Which court has jurisdiction over the case?

MTC has jurisdiction. Jurisdiction is based on the allegations in the complaint.

Thus, although the complaint bears the caption "recovery of possession," its allegations contain the
jurisdictional facts for an unlawful detainer case. Under RA 7691, an action for unlawful detainer is
within the MTC’s exclusive jurisdiction regardless of the property’s assessed value.

2. May ERORITA raise the issue on jurisdiction the first time on appeal? State the rule and the
exception.

Yes.

As a general rule, lack of jurisdiction over the subject matter may be raised at any time, or even for the
first time on appeal.
An exception to this rule is the principle of estoppel by laches. Laches refers to the "negligence or
omission to assert a right within a reasonable length of time, warranting a presumption that the party
entitled to assert it either has abandoned it or declined to assert it.” For example, if the lack of
jurisdiction was raised for the first time after almost fifteen (15) years after the questioned ruling had
been rendered and after the movant actively participated in several stages of the proceedings. And the
court rendered a decision adverse to the movant.

Note however that filing of an answer does not constitute the active participation in judicial proceedings.

3. ARMAND NOCUM v. LUCIO TAN, GR NO. 145022, 2005-09-23

Facts:

Petition for Review on Certiorari under Rule 45 of the 1997 Rules of Civil Procedure are the decision[1] of
the Court of Appeals dated 19 April 2000 that affirmed the order of the Regional Trial Court (RTC) of
Makati City... admitting respondent Lucio Tan's Amended Complaint for Damages for the alleged
malicious and defamatory imputations against him in two (2) articles of the Philippine Daily Inquirer, and
its Resolution[2] dated 15 September 2000 denying petitioners Armand Nocum and The Philippine Daily
Inquirer, Inc.'s motion for reconsideration.

On September 27, 1998, Lucio Tan filed a complaint against reporter Armand Nocum, Capt. Florendo
Umali, ALPAP and Inquirer with the Regional Trial Court of Makati, docketed as Civil Case No. 98-2288,
seeking moral and exemplary damages for the alleged... malicious and defamatory imputations
contained in a news article.

INQUIRER and NOCUM filed their joint answer, dated October 27, 1998, wherein they alleged that: (1)
the complaint failed to state a cause of action;

(2) the defamatory statements alleged in the complaint were general conclusions without factual
premises;
(3) the questioned... news report constituted fair and true report on the matters of public interest
concerning a public figure and therefore, was privileged in nature;... and (4) malice on their part was
negated by the publication in the same article of plaintiff's or PAL's side of the dispute with the... pilot's
union.

ALPAP and UMALI likewise filed their joint answer, dated October 31, 1998, and alleged therein that: (1)
the complaint stated no cause of action;... and (3) plaintiff Lucio Tan was not a real party in interest.

It appeared that the complaint... failed to state the residence of the complainant at the time of the
alleged commission of the offense and the place where the libelous article was printed and first
published.

Thus, the Regional Trial Court of Makati issued an Order dated February 10, 1999, dismissing the
complaint without prejudice on the ground of improper venue.

Aggrieved by the dismissal of the complaint, respondent Lucio Tan filed an Omnibus Motion dated
February 24, 1999, seeking reconsideration of the dismissal and admission of the amended complaint.

"This article was printed and first published in the City of Makati" (p. 53, Rollo, CA-G.R. SP No. 55192),
and in par. 2.04.1, that "This caricature was printed and first published in the City of Makati"

The lower court, after having the case dismissed for improper venue, admitted the amended complaint
and deemed set aside the previous order of dismissal,... "The mistake or deficiency in the original
complaint appears now to have been cured in the Amended Complaint which can still be properly
admitted, pursuant to Rule 10 of the 1997 Rules of Civil Procedure, inasmuch as the Order of dismissal is
not yet final.

their Answers. The Amendment is merely formal, contrary to the contention of the defendants that it is
substantial."
Dissatisfied, petitioners, together with defendants Capt. Florendo Umali and the Airline Pilots
Association of the Philippines, Inc. (ALPAP), appealed the RTC decision to the Court of Appeals. Two
petitions for certiorari were filed, one filed by petitioners... which was docketed as CA-G.R. SP No. 55192,
and the other by defendants Umali and ALPAP which was docketed as CA-G.R. SP No. 54894. The two
petitions were consolidated.

On 19 April 2000, the Court of Appeals rendered its decision the dispositive portion of which reads:

WHEREFORE, premises considered, the petition is hereby DENIED DUE COURSE and DISMISSED for lack
of merit. The Order of the court a quo is hereby AFFIRMED.

The motions for reconsideration filed by petitioners and by defendants Umali and ALPAP were likewise
denied in a resolution

Both petitioners and defendants Umali and ALPAP appealed to this Court.

Issues:

Did the lower court acquire jurisdiction over the civil case upon the filing of the original complaint for
damages?

Ruling:

We rule in the affirmative.

It is settled that jurisdiction is conferred by law based on the facts alleged in the complaint since the
latter comprises a concise statement of the ultimate facts constituting the plaintiff's causes of action.
In the case at bar, after examining... the original complaint, we find that the RTC acquired jurisdiction
over the case when the case was filed before it.

From the allegations thereof, respondent's cause of action is for damages arising from libel, the
jurisdiction of which is vested with the RTC. Article

360 of the Revised Penal Code provides that it is a Court of First Instance[12] that is specifically
designated to try a libel case.

Petitioners are confusing jurisdiction with venue. A former colleague, the Hon. Florenz D. Regalado,[14]
differentiated jurisdiction and venue as follows: (a) Jurisdiction is the authority to hear and determine a
case; venue is the place where the... case is to be heard or tried; (b) Jurisdiction is a matter of
substantive law; venue, of procedural law; (c) Jurisdiction establishes a relation between the court and
the subject matter; venue, a relation between plaintiff and defendant, or petitioner and respondent;
and, (d)

Jurisdiction is fixed by law and cannot be conferred by the parties; venue may be conferred by the act or
agreement of the parties.

In the case at bar, the additional allegations in the Amended Complaint that the article and the
caricature were printed and first published in the City of Makati referred only to the question of venue
and not jurisdiction.

These additional allegations would neither confer... jurisdiction on the RTC nor would respondent's
failure to include the same in the original complaint divest the lower court of its jurisdiction over the
case. Respondent's failure to allege these allegations gave the lower court the power, upon motion by a
party, to... dismiss the complaint on the ground that venue was not properly laid.

In Laquian v. Baltazar,[15] this Court construed the term "jurisdiction" in Article 360 of the Revised Penal
Code as referring to the place where actions for libel shall be filed or "venue."
In Escribano v. Avila,[16] pursuant to Republic Act No. 4363,[17] we laid down the following rules on the
venue of the criminal and civil actions in written defamations.

General rule: The action may be filed in the Court of First Instance of the province or city where the
libelous article is printed and first published or where any of the offended parties actually resides at the
time of the commission of the offense.

If the offended party is a public officer with office in Manila at the time the offense was committed, the
venue is Manila or the city or province where the libelous article is printed and first published.

Where an offended party is a public official with office outside of Manila, the venue is the province or
the city where he held office at the time of the commission of the offense or where the libelous article is
printed and first published.

If an offended party is a private person, the venue is his place of residence at the time of the commission
of the offense or where the libelous article is printed and first published.

The common feature of the foregoing rules is that whether the offended party is a public officer or a
private person, he has always the option to file the action in the Court of First Instance of the province or
city where the libelous article is printed or first... published.

It is elementary that objections to venue in CIVIL ACTIONS arising from libel may be waived since they do
not involve a question of jurisdiction.

The laying of venue is procedural rather than substantive, relating as it does to jurisdiction of the court
over the person... rather than the subject matter. Venue relates to trial and not to jurisdiction.

It is a procedural, not a jurisdictional, matter.

It relates to the place of trial or geographical location in which an action or proceeding should be
brought... and not to the jurisdiction of the court.

In contrast, in criminal actions, it... is fundamental that venue is jurisdictional it being an essential
element of jurisdiction.[23]

Petitioners' argument that the lower court has no jurisdiction over the case because respondent failed to
allege the place where the libelous articles were printed and first published would have been tenable if
the case filed were a criminal case. The failure of the... original complaint to contain such information
would be fatal because this fact involves the issue of venue which goes into the territorial jurisdiction of
the court. This is not to be because the case before us is a civil action where venue is not...
jurisdictional.

As discussed above, the

RTC acquired jurisdiction over the subject matter upon the filing of the original complaint. It did not lose
jurisdiction over the same when it dismissed it on the ground of improper venue. The amendment
merely laid down the proper venue of the case.

4. Surviving Heirs of Alfredo R. Bautista v Lindo (2014)

SURVIVING HEIRS OF ALFREDO R. BAUTISTA VS. LINDO

G.R. No. 208232, March 10, 2014

Facts:

Alfredo R. Bautista (Bautista), petitioner’s predecessor, inherited in 1983 a free-patent land located in
Davao Oriental and covered by OCT No. (1572) P-6144.A few years later, he subdivided the property and
sold it to several vendees, herein respondents, via a notarized deed of absolute sale dated May 30, 1991.
Two months later, OCT No.(1572) P-6144 was canceled and Transfer Certificates of Title (TCTs) were
issued in favor of the vendees.
On August 1994, Bautista filed a complaint for repurchase against respondents before the RTC, anchoring
his cause of action on Section 119 of Commonwealth Act No. (CA) 141, otherwise known as the “Public
Land Act,” which reads:

“SECTION 119. Every conveyance of land acquired under the free patent or homestead provisions, when
proper, shall be subject to repurchase by the applicant, his widow, or legal heirs, within a period of five
years from the date of the conveyance.”

During the pendency of the action, Bautista died and was substituted by petitioner, Efipania.
Respondents, Sps. Lindo entered into a compromise agreement with petitioners, whereby they agree to
cede to Epifania 3,230 sq.m..portion of the property as well as to waive, abandon, surrender, and
withdraw all claims and counterclaims against each other. RTC approve the compromise agreement on
January 2011.

Other respondents, filed a Motion to Dismissed on February 2013 alleging lack of jurisdiction of the RTC
on the ground that the complaint failed to state the value of the property sought to be recovered and
alleges that the total value of the properties in issue is only P16,500 pesos. RTC ruled in favor of the
respondent dismissing the case.

Issue:

Whether or not the RTC erred in granting the motion for the dismissal of the case on the ground of lack
of jurisdiction over the subject matter.

Ratio:

Yes. Jurisdiction of courts is granted by the Constitution and pertinent laws. Jurisdiction of RTCs, as may
be relevant to the instant petition, is provided in Sec. 19 of BP 129.

Issue:
Whether the action filed by petitioners is one involving title to or possession of real property or any
interest therein or one incapable of pecuniary estimation.

Ratio:

The Court rules that the complaint to redeem a land subject of a free patent is a civil action incapable of
pecuniary estimation.

It is a well-settled rule that jurisdiction of the court is determined by the allegations in the complaint and
the character of the relief sought. In this regard, the Court, in Russell v. Vestil, wrote that "in determining
whether an action is one the subject matter of which is not capable of pecuniary estimation this Court
has adopted the criterion of first ascertaining the nature of the principal action or remedy sought. If it is
primarily for the recovery of a sum of money, the claim is considered capable of pecuniary estimation,
and whether jurisdiction is in the municipal courts or in the RTCs would depend on the amount of the
claim." But where the basic issue is something other than the right to recover a sum of money, where
the money claim is purely incidental to, or a consequence of, the principal relief sought, this Court has
considered such actions as cases where the subject of the litigation may not be estimated in terms of
money, and, hence, are incapable of pecuniary estimation.

5. Padlan vs. Dinglasan

G.R. No. 180321; March 20, 2013

FACTS:

Elenita Dinglasan (Elenita) was the registered owner of a parcel of land covered by TCT No. T-105602.
While on board a jeepney, Elenita's mother, Lilia Baluyot (Lilia), had a conversation with one Maura
Passion (Maura) regarding the sale of said property. Believing that Maura was a real estate agent, Lilia
borrowed the owner's copy of the TCT from Elenita and gave it to Maura. Maura then subdivided the
property into several lots under the name of Elenita and her husband Felicisimo.
Through a falsified deed of sale bearing forged signature of Elenita and Felicisimo, Maura was able to sell
the lots to different buyers, one of whom was Lorna Ong (Lorna). Sometime in August 1990, Lorna sold
the lot to Editha Padlan for P4,000.

After learning what happened, Elenita demanded Padlan to surrender possession of said land, but the
latter refused. Respondents files a case before the RTC of Balanga, Bataan and summons to petitioner
was thereafter served.

On December 13, 1999, respondents moved to declare petitioner in default and prayed that they be
allowed to present evidence ex parte. Petitioner opposed the same contending that the court did not
have jurisdiction over the subject matter and over her person.

ISSUE:

Whether or not the court acquired jurisdiction over the subject matter and the person of the petitioner.

HELD:

The court has no jurisdiction over the subject matter and consequently, over the person of the
petitioner.

Respondents filed the complaint in 1999, at the time BP 129, the Judiciary Reorganization Act of 1980,
was already amended by RA No. 7691, An Act Expanding the Jurisdiction of the Metropolitan Trial
Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts. Section 3 of RA 7691 expanded the
exclusive original jurisdiction of the first level courts to include all civil actions which involve title to, or
possession, of real property, or any interest therein which does not exceed P20,000 or, in civil actions in
Metro Manila, where such assessed value does not exceed P50, 000.
In order to determine which court has jurisdiction over the action, an examination of the complaint is
essential. Basic as hornbook principle is that jurisdiction over the subject matter of a case is conferred by
law and determined by the allegations in the complaint which comprise a concise statement of the
ultimate facts constituting the plaintiff's cause of action.

In the case at bar, the only basis of valuation of the subject property is the value alleged in the complaint
that the lot was sold in the amount of P4, 000. No tax declaration was even presented that would show
the valuation of the subject property. Since the amount alleged is only P4, 000, the MTC and not the RTC
has jurisdiction over the action.

6. VDA. DE ENRIQUEZ, SONIA J. TOLENTINO and RODERICK JULAO, Petitioners,

v. SPOUSES ALEJANDRO and MORENITA DE JESUS, Respondents.

G.R. No. 176020 September 29, 2014

FACTS:

In 1960, Telesforo Julao filed before DENR two Townsite Sales Applications. Upon his death on
June 1, 1971, his applications were transferred to his heirs. On April 30, 1979, Solito Julao (Solito)
executed a Deed of Transfer of Rights, transferring his hereditary share in the property covered by TSA
No. V-6667 to respondent spouses Alejandro and Morenita De Jesus. In 1983, respondent spouses
constructed a house on the property they acquired from Solito. In 1986, Solito went missing.

On December 21, 1998, Original Certificate of Title (OCT) No. P-2446, covering a 641-square
meter property, was issued in favor of the heirs of Telesforo.

On March 2, 1999, petitioners representing themselves to be the heirs of Telesforo, filed before
the RTC of Baguio City, a Complaint or Recovery of Possession of Real Property against respondent
spouses. Petitioners alleged that they are the true and lawful owners of a 641-square meter parcel of
land located at Naguilian Road, Baguio City, covered by OCT No. P-2446; that the subject property
originated from TSA No. V-2132; that respondent spouses’ house encroached on 70 square meters of the
subject property, among others.
 RTC ruled in favor of petitioners. CA reversed the decision on two grounds: (1) failure on the
part of petitioners to identify the property sought to be recovered; and (2) lack of jurisdiction.

ISSUE:

Whether or not the RTC acquired jurisdiction over the complaint.

HELD:

NO. The Court held that in an action for recovery of possession, the assessed value of the
property sought to be recovered determines the court’s jurisdiction.

In this case, for the RTC to exercise jurisdiction, the assessed value of the subject property must
exceed P20,000.00. Since petitioners failed to allege in their Complaint the assessed value of the subject
property, the CA correctly dismissed the Complaint as petitioners failed to establish that the RTC had
jurisdiction over it. In fact, since the assessed value of the property was not alleged, it cannot be
determined which trial court had original and exclusive jurisdiction over the case.

In an action to recover, the property must be identified.

Moreover, Article 434 of the Civil Code states that “in an action to recover, the property must be
identified, and the plaintiff must rely on the strength of his title and not on the weakness of the
defendant’s claim.” The plaintiff, therefore, is duty-bound to clearly identify the land sought to be
recovered, in accordance with the title on which he anchors his right of ownership.66 It bears stressing
that the failure of the plaintiff to establish the identity of the property claimed is fatal to his case.

In this case, petitioners failed to identify the property they seek to recover as they failed to
describe the location, the area, as well as the boundaries thereof. In fact, as aptly pointed out by the CA,
no survey plan was presented by petitioners to prove that respondent spouses actually encroached upon
the 70-square meter portion of petitioners’ property. Failing to prove their allegation, petitioners are not
entitled to the relief prayed for in their Complaint.

7. SUPAPO v. SPS. ROBERTO AND SUSAN DE JESUS, GR No. 198356, 2015-04-20

Facts:

The Spouses Supapo filed a complaint[5] for accion publiciana against Roberto and Susan de Jesus
(Spouses de Jesus), Macario Bernardo (Macario), and persons claiming rights under them (collectively,
the respondents), with the

Metropolitan Trial Court (MeTC) of Caloocan City.

The complaint sought to compel the respondents to vacate a piece of land located in Novaliches, Quezon
City... egistered and... titled under the Spouses Supapo's names.

land has an assessed value of thirty-nine thousand nine hundred eighty pesos (39,980.00) as shown in
the Declaration of Real Property Value (tax declaration) issued by the Office of the City Assessor

The Spouses Supapo did not reside on the subject lot.

they made sure to visit at least twice a year.

During one of their visits in 1992, they saw two (2) houses built on the subject lot. The houses were
built... without their knowledge and permission.

The Spouses Supapo demanded from the respondents the immediate surrender of the subject lot by
bringing the dispute before the appropriate Lupong Tagapamayapa
Lupon issued

(certificate to file action) for... failure of the parties to settle amicably.[10]

The Spouses Supapo then filed a criminal case... for violation of

the Anti-Squatting Law.

nts

The trial court convicted the respondents... pay a fine of ONE THOUSAND

PESOS (P1,000.00), and to vacate the subject premises.

The respondents appealed their conviction to the CA.

While the appeal was pending, Congress enacted Republic Act (RA) No. 8368, otherwise known as "An
Act Repealing Presidential Decree No. 772," which resulted to the dismissal of the criminal... case.

Spouses Supapo moved for the execution of the respondents' civil liability, praying that the latter vacate
the subject lot.

(RTC) granted the motion and issued the writ of execution.

The respondents moved for the... quashal of the writ but the RTC denied the same. The RTC also denied
the respondents' motion for reconsideration.

The respondents thus filed with the CA a petition for certiorari

The CA granted the petition and held that with the repeal of the

Anti-Squatting Law, the respondents' criminal and civil liabilities were extinguished.[... the CA noted that
recourse may be had in court by filing the proper action for recovery of possession.

The Spouses Supapo thus filed the complaint for action publiciana.

respondents moved to set their affirmative defenses for preliminary hearing... argued that... there is
another action pending between the same parties;... accion... publiciana is barred by statute of
limitations

Spouses Supapo's cause of action is barred by prior judgment.

MeTC denied the motion to set the affirmative defenses for preliminary hearing

MeTC likewise denied the respondents' motion for... reconsideration.

respondents filed a petition for certiorari with the RTC.

RTC granted the petition for certiorari on two grounds... action has prescribed... accion publiciana falls
within the exclusive jurisdiction of the RTC.

In their motion for reconsideration

Spouses Supapo emphasized that the court's jurisdiction over an action involving title to or possession of
land is determined by its assessed value;

RTC does not have an exclusive jurisdiction on all... complaints for accion publiciana; and that the
assessed value of the subject lot falls within MeTC's jurisdiction.

The RTC denied the petitioners' motion for reconsideration.

It held that although the MeTC had jurisdiction based on the assessed value of the subject lot, the
Spouses Supapos' cause of action had already prescribed, the action having been filed beyond the ten
(l0)-year prescriptive period under Article 555 of the Civil Code.

RTC ruled that the reckoning period by which the ejectment suit should have been filed is counted from
the time the certificate to file action was issued. The certificate to file action was... issued on November
25, 1992, while the complaint for accion publiciana was filed only on March 7, 2008, or more than ten
(10) years thereafter.

Spouses Supapo appealed to the CA.

The CA dismissed the appeal... held that the complaint for accion publiciana should have been lodged
before the RTC... period to file the action had prescribed.

Spouses Supapo moved... but failed... to secure a reconsideration of the CA decision; hence, they came
to us through the present petition.
Spouses Supapo essentially argue that:

MeTC exercises exclusive original jurisdiction over accion publiciana where the assessed value of the
property does not exceed P20,000.00, or P50,000.00... prescription had not yet set in because their
cause of action is imprescriptible under the Torrens system.

respondents argue... accion publiciana was... filed in the wrong court;... barred by prescription;... barred
by res judicata.

Issues:

Whether the MeTC properly acquired jurisdiction;

Whether the cause of action has prescribed;

Whether the complaint for accion publiciana is barred by res judicata.

Ruling:

The petition is meritorious.

We hold that: (1) the MeTC properly acquired jurisdiction; (2) the cause of action has not prescribed; and
(3) the complaint is not barred by res judicata.
In the present case, the Spouses Supapo filed an action for the recovery of possession of the subject
lot... based their better right of possession on a claim of ownership.

while we will dissect the Spouses Supapo's claim of ownership over the subject property, we will only do
so to determine if they or the respondents should have the right of possession.

we now resolve which court has the jurisdiction to hear the case.

law in effect when the action is filed... pouses Supapo alleged that the assessed value of the subject lot,
located in Metro Manila, is P39,980.00

Given that the Spouses Supapo duly complied with the jurisdictional requirements, we hold that the
MeTC of Caloocan properly acquired jurisdiction over the complaint for accion publiciana.

The cause of action... has not prescribed... respondents point out that the Spouses Supapo filed the
complaint for accion publiciana on March 7, 2008 or more than ten (10) years after the certificate to file
action was issued on November 25, 1992.

TCT over the subject property, and assuming a Torrens title is imprescriptible and indefeasible, they posit
that the latter have lost their right to recover possession because of laches.

On their part, the Spouses Supapo... argue that their cause of action is imprescriptible since the subject
property is... registered and titled under the Torrens system.

We rule that the Spouses Supapo's position is legally correct.

The respondents contend that they built their houses on the... subject lot in good faith. Having
possessed the subject lot for more than ten (10) years, they claim that they can no longer be disturbed in
their possession.[48]
Under the undisputed facts of this case, we find that the respondents' contentions have no legal basis.

The Spouses Supapo (as holders of the TCT) enjoy a panoply of benefits under the Torrens system. The
most essential insofar as the present case is concerned is Section 47 of PD No. 1529 which states:... the
lawful owners have a right to demand... the return of their property at any time as long as the
possession was unauthorized or merely tolerated, if at all.

By respecting the imprescriptibility and indefeasibility of the Spouses Supapo's TCT, this Court merely
recognizes the value of the Torrens System in ensuring the stability of real estate transactions and
integrity of land registration.

With respect to the respondents' defense[59] of laches, suffice it to say that the same is evidentiary in
nature and cannot be established by mere allegations in the pleadings

Thus, without solid evidentiary basis, laches cannot be a valid ground to deny the Spouses Supapo's
petition

With these as premises, we cannot but rule that the Spouses Supapo's right to recover possession of the
subject lot is not barred by prescription.

The action is not barred... by prior judgment

They contend that the decision of the CA in CA-G.R. SP No. 78649 barred the filing of the action
publiciana.

CA-G.R. SP No. 78649 is the petition for certiorari filed by the respondents to challenge the RTC's
issuance of the writ enforcing their civil liability
The CA granted the petition and permanently enjoined the execution of the respondents' conviction
because their criminal liability had been extinguished by the repeal

Res judicata is not present in this case.

it is obvious that the there is no identity of subject matter, parties and causes of action between the
criminal case prosecuted under the Anti-Squatting Law and the civil action for the recovery of the
subject... property.

criminal complaint,... was prosecuted in the name of the people of the Philippines... accion publiciana...
was filed by and in the name of the Spouses Supapo... criminal case... prosecution of a crime under the
Anti-Squatting Law... accion publiciana is an action to recover possession of the subject property.

Philippines filed the criminal case to protect and preserve governmental interests... there is no identity
of parties between the criminal complaint under the Anti-Squatting law and the civil action for accion
publiciana. For this reason alone, "collusiveness of judgment" does not apply.

Even if we assume, for the sake of argument, that there is identity of parties, "conclusiveness of
judgment" still does not apply because there is no identity of issues

For all these reasons, the defense of res judicata is baseless.

We stress that our ruling in this case is limited only to the issue of determining who between the parties
has a better right to possession

This adjudication is not a final and binding determination of the issue of ownership.

we GRANT the petition

REVERSE and SET ASIDE... resolution of the Court of Appeals

8.SPS. CLAUDIO AND CARMENCITA TRAYVILLA v. BERNARDO SEJAS +

Facts:

In 2005, petitioners Claudio and Carmencita Trayvilla instituted before the RTC Civil Case No. 4633-2K5
against respondent Bernardo Sejas (Sejas). In their Complaint[6] for specific performance and damages,
petitioners claimed among others that Sejas was the registered owner of a 434-square meter parcel of
land in Tukuran, Zamboanga del Sur covered by Transfer Certificate of Title No. T-8,337[7] (TCT T-8,337);
that by virtue of a private handwritten document,[8] Sejas sold said parcel of land to them in 1982; that
thereafter, they took possession of the land and constructed a house thereon; that they resided in said
house and continued to reside therein; that Sejas later reasserted his ownership over said land and was
thus guilty of fraud and deceit in so doing; and that they caused the annotation of an adverse claim.
They prayed that Sejas be ordered to execute a final deed of sale over the property and transfer the
same to them, and that they be awarded the sum of P30,000.00 as attorney's fees plus P1,500.00 per
court appearance of counsel.

In an Amended Complaint,[9] this time for specific performance, reconveyance, and damages,
petitioners impleaded respondent Juvy Paglinawan (Paglinawan) as additional defendant, claiming that
Sejas subsequently sold the subject property to her, after which she caused the cancellation of TCT T-
8,337 and the issuance of a new title - TCT T-46,627 - in her name. Petitioners prayed that Sejas be
ordered to execute a final deed of sale in their favor and transfer the property to them; that
Paglinawan's TCT T-46,627 be canceled and the property be reconveyed to them; and that they be
awarded P50,000.00 in moral damages, in addition to the P30,000.00 attorney's fees and P1,500.00 per
court appearance of counsel originally prayed for in the Complaint.

However, the additional docket fees for the moral damages prayed for in the Amended Complaint were
not paid.[10] Likewise, for the additional causes of action, no docket fees were charged and paid.

Respondents moved for dismissal of the case, claiming lack of jurisdiction over the subject matter and
prescription.
Issues

1. Did the Court of Appeals ruled [sic] correctly when it dismissed the complaint by reason of Petitioner-
Appellants' alleged non-payment of the correct dockets [sic] fees due to its [sic] failure to alleged [sic]
the fair market value or the stated value of the subject property in the amended complaint?

2. Did the filing of the amended complaint sufficiently divested [sic] and ousted [sic] the trial court of its
jurisdiction over the case that had initially validly attached by virtue of the Original complaint for specific
performance?[22]

Ruling

The Court denies the Petition.

As correctly ruled by the CA, while petitioners' Amended Complaint was denominated as one mainly for
specific performance, they additionally prayed for reconveyance of the property, as well as the
cancellation of Paglinawan's TCT T-46,627. In other words, petitioners' aim in filing Civil Case No. 4633-
2K5 was to secure their claimed ownership and title to the subject property, which qualifies their case as
a real action. Pursuant to Section 1, Rule 4 of the 1997 Rules of Civil Procedure,[27] a real action is one
that affects title to or possession of real property, or an interest therein.

Since Civil Case No. 4633-2K5 is a real action made so by the Amended Complaint later filed, petitioners
should have observed the requirement under A.M. No. 04-2-04-SC[28] relative to declaring the fair
market value of the property as stated in the current tax declaration or zonal valuation of the Bureau of
Internal Revenue (BIR), Since no such allegation was made in the Amended Complaint, then the value of
the subject property as stated in the handwritten document sued upon and restated in the Amended
Complaint should be the basis for determining jurisdiction and the amount of docket fees to be paid.

The CA is correct in its general observation that in the absence of the required declaration of the fair
market value as stated in the current tax declaration or zonal valuation of the property, it cannot be
determined whether the RTC or first level court has original and exclusive jurisdiction over the
petitioners' action, since the jurisdiction of these courts is determined on the basis of the value of the
property. Under applicable rules,
Jurisdiction of RTCs, as may be relevant to the instant petition, is provided in Sec. 19 of BP 129,[29]
which reads;

Sec. 19. Jurisdiction in civil cases. — Regional Trial Courts shall exercise exclusive original jurisdiction:

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

2) In all civil actions which involve the title to, or possession of, real property, or any interest therein,
where the assessed value of the property involved exceeds Twenty thousand pesos (P20,000.00) or, for
civil actions in Metro Manila, where such value exceeds Fifty thousand pesos (P50,000.00) except actions
for forcible entry into and unlawful detainer of lands or buildings, original jurisdiction over which is
conferred upon the Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts.

On the other hand, jurisdiction of first level courts is prescribed in Sec. 33 of BP 129, which provides:

Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial Courts
in civil cases.—Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts shall
exercise:

xxxx

3) Exclusive original jurisdiction in all civil actions which involve title to, or possession of, real property, or
any interest therein where the assessed value of the property or interest therein does not exceed
Twenty thousand pesos (P20,000.00) or, in civil actions in Metro Manila, where such assessed value does
not exceed Fifty thousand pesos (950,000.00) exclusive of interest, damages of whatever kind, attorney's
fees, litigation expenses and costs: Provided, That in cases of land not declared for taxation purposes, the
value of such property shall be determined by the assessed value of the adjacent lots.[30]

However, the CA failed to consider that in determining jurisdiction, it could rely on the declaration made
in the Amended Complaint that the property is valued at P6,000.00. The handwritten document sued
upon and the pleadings indicate that the property was purchased by petitioners for the price of
P6,000.00. For purposes of filing the civil case against respondents, this amount should be the stated
value of the property in the absence of a current tax declaration or zonal valuation of the BIR. Rule 141
of the Rules of Court, as amended by A.M. No. 04-2-04-SC and Supreme Court Amended Administrative
Circular No. 35-2004, provides that -

a) For filing an action or a permissive OR COMPULSORY counterclaim, CROSS-CLAIM, or money claim

against an estate not based on judgment, or for filing a third-party, fourth-party, etc. complaint, or a
complaint-in-intervention, if the total sum claimed, INCLUSIVE OF INTERESTS, PENALTIES, SURCHARGES,
DAMAGES OF WHATEVER KIND, AND ATTORNEY'S FEES, LITIGATION EXPENSES AND COSTS and/or in
cases involving property, the FAIR MARKET value of the REAL property in litigation STATED IN THE
CURRENT TAX DECLARATION OR CURRENT ZONAL VALUATION OF THE BUREAU OF INTERNAL REVENUE,
WHICHEVER IS HIGHER, OR IF THERE IS NONE, THE STATED VALUE OF THE PROPERTY IN LITIGATION OR
THE VALUE OF THE PERSONAL PROPERTY IN LITIGATION AS ALLEGED BY THE CLAIMANT x x x (Emphasis
supplied)

shall be the basis for the computation of the docket fees to be paid. Since the value of the subject
property as stated in the Amended Complaint is just P6,000.00, then the RTC did not have jurisdiction
over petitioners' case in the first instance; it should have dismissed Civil Case No. 4633-2K5. But it did
not. In continuing to take cognizance of the case, the trial court clearly committed grave abuse of
discretion.

WHEREFORE, the Petition is DENIED, The assailed November 29, 2011 Decision and November 19, 2012
Resolution of the Court of Appeals in CA-G.R. SP No. 02315 are AFFIRMED.

9. SPOUSES RAMON MENDIOLA and ARACELI N. MENDIOLA, Petitioners,

vs.

THE HON. COURT OF APPEALS, PILIPINAS SHELL PETROLEUM CORPORATION, and TABANGAO REALTY,
INC., Respondents.

Facts:

On July 31, 1985, Pilipinas Shell Petroleum Corporation (Shell) entered into an agreement for the
distribution of Shell petroleum products (such as fuels, lubricants and allied items) by Pacific
Management & Development (Pacific), a single proprietorship belonging to petitioner Ramon G.
Mendiola (Ramon). To secure Pacific’s performance of its obligations under the agreement, petitioners
executed on August 1, 1985 a real estate mortgage in favor of Shell3 covering their real estate and its
improvements, located in the then Municipality of Parañaque, Rizal, and registered under Transfer
Certificate of Title No. S-59807 of the Registry of Deeds of Rizal (in the name of "Ramon Mendiola,
married to Araceli Mendoza").4
Pacific ultimately defaulted on its obligations, impelling Shell to commence extrajudicial foreclosure
proceedings in April 1987. Having received a notice of the extrajudicial foreclosure scheduled to be held
at the main entrance of the Parañaque Municipal Hall on May 14, 1987,5 petitioners proceeded to the
announced venue on the scheduled date and time but did not witness any auction being conducted and
did not meet the sheriff supposed to conduct the auction despite their being at the lobby from 9:00 am
until 11:30 am of May 14, 1987.6 They later learned that the auction had been held as scheduled by
Deputy Sheriff Bernardo San Juan of the Regional Trial Court (RTC) in Makati, and that their mortgaged
realty had been sold to Tabangao Realty, Inc. (Tabangao), as the corresponding certificate of sale bears
out.7 They further learned that Tabangao’s winning bidder bid of P670,000.00 had topped Shell’s bid of
P660,000.00.8

After application of the proceeds of the sale to the obligation of Pacific, a deficiency of P170,228.00
(representing the foreclosure expenses equivalent of 25% of the amount claimed plus interest)
remained. The deficiency was not paid by Ramon. Thus, on September 2, 1987, Shell sued in the RTC in
Manila to recover the deficiency, docketed as Civil Case No. 87-41852 entitled Pilipinas Shell Petroleum
Corporation v. Ramon G. Mendiola, doing business under the name and style Pacific Management &
Development (Manila case).9

On March 22, 1988, petitioners commenced in the RTC in Makati an action to annul the extrajudicial
foreclosure docketed as Civil Case No. 88-398 entitled Ramon G. Mendiola and Araceli N. Mendiola v.
Pilipinas Shell Petroleum Corporation, Tabangao Realty, Inc., and Maximo C. Contreras, as Clerk of Court
and Ex Oficio Sheriff of Rizal,10 which was assigned to Branch 134 (Makati case).

As defendants in the Makati case, Shell and Tabangao separately moved for dismissal

After the Makati RTC denied both motions on September 23, 1988,12 Shell filed its answer ad
cautelam,13 whereby it denied petitioners’ allegation that no auction had been held; insisted that there
had been proper accounting of the deliveries made to Pacific and its clients; and averred that petitioners’
failure to file their compulsory counterclaim in the Manila case already barred the action.

Pending the trial of the Makati case, the Manila RTC rendered its judgment in favor of Shell on May 31,
1990,
As sole defendant in the Manila case, Ramon appealed (C.A.-G.R. No. CV-28056), but his appeal was
decided adversely to him on July 22, 1994,15 with the CA affirming the Manila RTC’s decision and finding
that he was guilty of forum shopping for instituting the Makati case.

Undaunted, he next appealed to the Court (G.R. No. 122795), which denied his petition for review on
February 26, 1996,16 and upheld the foreclosure of the mortgage. The decision of the Court became
final and executory, as borne out by the entry of judgment issued on June 10, 1996.17

Nonetheless, on February 3, 1998, the Makati RTC resolved the Makati case,18 finding that there had
been no auction actually conducted on the scheduled date; that had such auction taken place,
petitioners could have actively participated and enabled to raise their objections against the amount of
their supposed obligation; and that they had been consequently deprived of notice and hearing as to
their liability.

Aggrieved by the decision of the Makati RTC, Shell and Tabangao filed a joint notice of appeal.22 The
appeal was docketed in the CA as C.A.-G.R. No. 65764.

On November 22, 2002, the CA denied petitioners’ motion to dismiss appeal through the first assailed
resolution,

Issues

. The first is whether or not an appeal may be taken from the denial of a motion for reconsideration of
the decision of February 3, 1998.

The second is whether the Makati case could prosper independently of the Manila case.

Ruling

The petition for certiorari, mandamus and prohibition lacks merit. we DISMISS the petition for certiorari,
prohibition and mandamus for lack of merit; CONSIDER Civil Case No. 88-398 dismissed with prejudice
on the. ground of res judicata; and ORDER petitioners to pay the costs of suit to respondents.
1. Appeal by Shell and Tabangao of the denial of their motion for reconsideration was not proscribed

Petitioners’ contention that the appeal by Shell and Tabangao should be rejected on the ground that an
appeal of the denial of their motion for reconsideration was prohibited cannot be sustained.

It is true that the original text of Section 1, Rule 41 of the 1997 Rules of Civil Procedure expressly limited
an appeal to a judgment or final order, and proscribed the taking of an appeal from an order denying a
motion for new trial or reconsideration,

Where the judgment or final order is not appealable, the aggrieved party may file an appropriate special
civil action under Rule 65. (n)

The inclusion of the order denying a motion for new trial or a motion for reconsideration in the list of
issuances of a trial court not subject to appeal was by reason of such order not being the final order
terminating the proceedings in the trial court. This nature of the order is reflected in Section 9 of Rule 37
of the 1997 Rules of Civil Procedure, which declares that such order denying a motion for new trial or
reconsideration is not appealable, "the remedy being an appeal from the judgment or final order."

The restriction against an appeal of a denial of a motion for reconsideration independently of a

judgment or final order is logical and reasonable. A motion for reconsideration is not putting forward a
new issue, or presenting new evidence, or changing the theory of the case, but is only seeking a
reconsideration of the judgment or final order based on the same issues, contentions, and evidence
either because: (a) the damages awarded are excessive; or (b) the evidence is insufficient to justify the
decision or final order; or (c) the decision or final order is contrary to law.

By denying a motion for reconsideration, or by granting it only partially, therefore, a trial court finds no
reason either to reverse or to modify its judgment or final order, and leaves the judgment or final order
to stand. The remedy from the denial is to assail the denial in the course of an appeal of the judgment or
final order itself.

In Quelnan v. VHF Philippines, Inc.,28 however, the Court has interpreted the proscription against
appealing the order denying a motion for reconsideration to refer only to a motion for reconsideration
filed against an interlocutory order, not to a motion for reconsideration filed against a judgment or final
order,

The rationale behind the rule proscribing the remedy of appeal from an interlocutory order is to prevent
undue delay, useless appeals and undue inconvenience to the appealing party by having to assail orders
as they are promulgated by the court, when they can be contested in a single appeal. The appropriate
remedy is thus for the party to wait for the final judgment or order and assign such interlocutory order
as an error of the court on appeal.

The denial of the motion for reconsideration of an order of dismissal of a complaint is not an
interlocutory order, however, but a final order as it puts an end to the particular matter resolved, or
settles definitely the matter therein disposed of, and nothing is left for the trial court to do other than to
execute the order.

Not being an interlocutory order, an order denying a motion for reconsideration of an order of dismissal
of a complaint is effectively an appeal of the order of dismissal itself.

The reference by petitioner, in his notice of appeal, to the March 12, 1999 Order denying his Omnibus
Motion—Motion for Reconsideration should thus be deemed to refer to the January 17, 1999 Order
which declared him non-suited and accordingly dismissed his complaint.

If the proscription against appealing an order denying a motion for reconsideration is applied to any
order, then there would have been no need to specifically mention in both above-quoted sections of the
Rules "final orders or judgments" as subject of appeal. In other words, from the entire provisions of Rule
39 and 41, there can be no mistaking that what is proscribed is to appeal from a denial of a motion for
reconsideration of an interlocutory order.29

In Apuyan v. Haldeman,30 too, the Court categorized an order denying the motion for reconsideration as
the final resolution of the issues a trial court earlier passed upon and decided, and accordingly held that
the notice of appeal filed against the order of denial was deemed to refer to the decision subject of the
motion for reconsideration.31
Subsequently, in Neypes v. Court of Appeals,32 where the decisive issue was whether or not the appeal
was taken within the reglementary period, with petitioners contending that they had timely filed their
notice of appeal based on their submission that the period of appeal should be reckoned from July 22,
1998, the day they had received the final order of the trial court denying their motion for
reconsideration (of the order dismissing their complaint), instead of on March 3, 1998, the day they had
received the February 12, 1998 order dismissing their complaint, the Court, citing Quelnan v. VHF
Philippines, Inc. and Apuyan v. Haldeman, ruled that the receipt by petitioners of the denial of their
motion for reconsideration filed against the dismissal of their complaint, which was a final order, started
the reckoning point for the filing of their appeal, to wit:

Rule 41, Section 3 of the 1997 Rules of Civil Procedure states:

SEC. 3. Period of ordinary appeal. ― The appeal shall be taken wi thin fifteen (15) days from the notice of
the judgment or final order appealed from. Where a record on appeal is required, the appellant shall file
a notice of appeal and a record on appeal within thirty (30) days from the notice of judgment or final
order.

The period to appeal shall be interrupted by a timely motion for new trial or reconsideration. No motion
for extension of time to file a motion for new trial or reconsideration shall be allowed. (emphasis
supplied)

Based on the foregoing, an appeal should be taken within 15 days from the notice of judgment or final
order appealed from. A final judgment or order is one that finally disposes of a case, leaving nothing
more for the court to do with respect to it. It is an adjudication on the merits which, considering the
evidence presented at the trial, declares categorically what the rights and obligations of the parties are;
or it may be an order or judgment that dismisses an action.

What therefore should be deemed as the "final order," receipt of which triggers the start of the 15-day
reglementary period to appeal – the February 12, 1998 order dismissing the complaint or the July 1,
1998 order dismissing the MR?
In the recent case of Quelnan v. VHF Philippines, Inc., the trial court declared petitioner Quelnan non-
suited and accordingly dismissed his complaint. Upon receipt of the order of dismissal, he filed an
omnibus motion to set it aside. When the omnibus motion was filed, 12 days of the 15-day period to
appeal the order had lapsed. He later on received another order, this time dismissing his omnibus
motion. He then filed his notice of appeal. But this was likewise dismissed ― for having been filed out of
time.

The court a quo ruled that petitioner should have appealed within 15 days after the dismissal of his
complaint since this was the final order that was appealable under the Rules. We reversed the trial court
and declared that it was the denial of the motion for reconsideration of an order of dismissal of a
complaint which constituted the final order as it was what ended the issues raised there.

This pronouncement was reiterated in the more recent case of Apuyan v. Haldeman et al. where we
again considered the order denying petitioner Apuyan’s motion for reconsideration as the final order
which finally disposed of the issues involved in the case.

Based on the aforementioned cases, we sustain petitioners’ view that the order dated July 1, 1998
denying their motion for reconsideration was the final order contemplated in the Rules.33

As the aftermath of these rulings, the Court issued its resolution in A.M. No. 07-7-12-SC to approve
certain amendments to Rules 41, 45, 58 and 65 of the Rules of Court effective on December 27, 2007.
Among the amendments was the delisting of an order denying a motion for new trial or motion for
reconsideration from the enumeration found in Section 1, Rule 41 of the 1997 Rules of Civil Procedure of
what are not appealable. The amended rule now reads:

Section 1. Subject of appeal.— An appeal may be taken from a judgment or final order that completely
disposes of the case, or of a particular matter therein when declared by these Rules to be appealable.

No appeal may be taken from:

(a) An order denying a petition for relief or any similar motion seeking relief from judgment;
(b) An interlocutory order;

(c) An order disallowing or dismissing an appeal;

(d) An order denying a motion to set aside a judgment by consent, confession or compromise on the
ground of fraud, mistake or duress, or any other ground vitiating consent;

(e) An order of execution;

(f) A judgment or final order for or against one or more of several parties or in separate claims,
counterclaims, cross-claims and third-party complaints, while the main case is pending, unless the court
allows an appeal therefrom; and

(g) An order dismissing an action without prejudice.

In any of the foregoing circumstances, the aggrieved party may file an appropriate special civil action as
provided in Rule 65.

Based on the foregoing developments, Shell and Tabangao’s appeal, albeit seemingly directed only at the
October 5, 1999 denial of their motion for reconsideration, was proper. Thus, we sustain the CA’s denial
for being in accord with the rules and pertinent precedents. We further point out that for petitioners to
insist that the appeal was limited only to the assailed resolution of October 5, 1999 was objectively
erroneous, because Shell and Tabangao expressly indicated in their appellant’s brief that their appeal
was directed at both the February 3, 1998 decision and the October 5, 1999 resolution.34

The petition cannot prosper if the CA acted in accordance with law and jurisprudence. Certiorari,
prohibition and mandamus are extraordinary remedies intended to correct errors of jurisdiction and to
check grave abuse of discretion. The term grave abuse of discretion connotes capricious and whimsical
exercise of judgment as is equivalent to excess, or a lack of jurisdiction.35 The abuse must be so patent
and gross as to amount to an evasion of a positive duty or a virtual refusal to perform a duty enjoined by
law, or to act at all in contemplation of law as where the power is exercised in an arbitrary and despotic
manner by reason of passion or hostility.36 Yet, here, petitioners utterly failed to establish that the CA
abused its discretion, least of all gravely.

2. Makati case is barred and should be dismissed on ground of res judicata and waiver.

Shell and Tabangao’s insistence has merit. The Makati case should have been earlier disallowed to
proceed on the ground of litis pendentia, or, once the decision in the Manila case became final, should
have been dismissed on the ground of being barred by res judicata.

In the Manila case, Ramon averred a compulsory counterclaim asserting that the extrajudicial
foreclosure of the mortgage had been devoid of basis in fact and in law; and that the foreclosure and the
filing of the action had been made in bad faith, with malice, fraudulently and in gross and wanton
violation of his rights. His pleading thereby showed that the cause of action he later pleaded in the
Makati case - that of annulment of the foreclosure sale - was identical to the compulsory counterclaim
he had set up in the Manila case.

Accordingly, a counterclaim is compulsory if: (a) it arises out of or is necessarily connected with the
transaction or occurrence which is the subject matter of the opposing party’s claim; (b) it does not
require for its adjudication the presence of third parties of whom the court cannot acquire jurisdiction;
and (c) the court has jurisdiction to entertain the claim both as to its amount and nature, except that in
an original action before the RTC, the counterclaim may be considered compulsory regardless of the
amount.

A compulsory counterclaim that a defending party has at the time he files his answer shall be contained
therein.37 Pursuant to Section 2, Rule 9 of the 1997 Rules of Civil Procedure, a compulsory counterclaim
not set up shall be barred.

The four tests to determine whether a counterclaim is compulsory or not are the following, to wit: (a)
Are the issues of fact or law raised by the claim and the counterclaim largely the same? (b) Would res
judicata bar a subsequent suit on defendant’s claims, absent the compulsory counterclaim rule? (c) Will
substantially the same evidence support or refute plaintiff’s claim as well as the defendant’s
counterclaim? and (d) Is there any logical relation between the claim and the counterclaim, such that the
conduct of separate trials of the respective claims of the parties would entail a substantial duplication of
effort and time by the parties and the court?
The four tests are affirmatively met as far as the Makati case was concerned. The Makati case had the
logical relation to the Manila case because both arose out of the extrajudicial foreclosure of the real
estate mortgage constituted to secure the payment of petitioners’ credit purchases under the
distributorship agreement with Shell. Specifically, the right of Shell to demand the deficiency was
predicated on the validity of the extrajudicial foreclosure, such that there would not have been a
deficiency to be claimed in the Manila case had Shell not validly foreclosed the mortgage. As earlier
shown, Ramon’s cause of action for annulment of the extrajudicial foreclosure was a true compulsory
counterclaim in the Manila case. Thus, the Makati RTC could not have missed the logical relation
between the two actions.

We hold, therefore, that the Makati case was already barred by res judicata. Hence, its immediate
dismissal is warranted.

Bar by res judicata avails if the following elements are present, to wit: (a) the former judgment or order
must be final; (b) the judgment or order must be on the merits; (c) it must have been rendered by a
court having jurisdiction over the subject matter and the parties; (d) there must be, between the first
and the second action, identity of parties, of subject matter and cause of action.40

The Manila RTC had jurisdiction to hear and decide on the merits Shell’s complaint to recover the
deficiency, and its decision rendered on May 31, 1990 on the merits already became final and executory.
Hence, the first, second and third elements were present.

Anent the fourth element, the Makati RTC concluded that the Manila case and the Makati case had no
identity as to their causes of action, explaining that the former was a personal action involving the
collection of a sum of money, but the latter was a real action affecting the validity of the foreclosure sale,
stating in its order of October 5, 1999 denying Shell’s motion for reconsideration as follows:

Finally, as to whether there is identity of causes of action between the two (2) cases, this Court finds in
negative.

Civil Case No. 42852 is for collection of sum of money, a personal action where what is at issue is
whether spouses Mendiola have indebtedness to Pilipinas Shell. however it appears from the Decision
rendered in said case that the issue on validity of foreclosure sale was not fully ventilated before the RTC
Manila because spouses Mendiola’s right to present evidence in its behalf was declared waived.
Naturally, where this issue was not fully litigated upon, no resolution or declaration could be made
therein.

On the other hand, Civil Case No. 88-398 is an action for declaration of nullity or annulment of
foreclosure sale, a real action where the location of property controls the venue where it should properly
be filed. This Court undoubtedly has jurisdiction to adjudicate this case. Plaintiff spouses Mendiola
merely claimed that no actual foreclosure sale was conducted, and if there was, the same was
premature for lack of notice and hearing. Take note that plaintiffs do not deny their indebtedness to
Pilipinas Shell although the amount being claimed is disputed. They are simply asserting their rights as
owners of the mortgaged property, contending that they were not afforded due process in the course of
foreclosure proceedings. And based mainly on the testimonial and documentary evidence presented, as
well as the postulations, expositions and arguments raised by all parties in this case, it is the Court’s
considered view that spouses Mendiola have established the material allegations in their complaint and
have convincingly shown to the satisfaction of the Court that they are entitled to the reliefs prayed for.
With these findings and adjudications, the Court does not find inconsistency with those held in Civil Case
No. 42852. As to whether spouses Mendiola is still indebted to Pilipinas Shell is not in issue here, and not
even a single discussion touched that matter as this would tantamount to encroaching upon the subject
matter litigated in Civil Case No. 42852.41

The foregoing conclusion of the Makati RTC on lack of identity between the causes of action was patently
unsound. The identity of causes of action does not mean absolute identity; otherwise, a party may easily
escape the operation of res judicata by changing the form of the action or the relief sought. The test to
determine whether the causes of action are identical is to ascertain whether the same evidence will
sustain the actions, or whether there is an identity in the facts essential to the maintenance of the
actions. If the same facts or evidence will sustain the actions, then they are considered identical, and a
judgment in the first case is a bar to the subsequent action.42 Petitioners’ Makati case and Shell’s Manila
case undeniably required the production of the same evidence. Also, both cases arose from the same
transaction (i.e., the foreclosure of the mortgage), such that the success of Ramon in invalidating the
extrajudicial foreclosure would have necessarily negated Shell’s right to recover the deficiency.

Apparently, the Makati RTC had the erroneous impression that the Manila RTC did not have jurisdiction
over the complaint of petitioners because the property involved was situated within the jurisdiction of
the Makati RTC. Thereby, the Makati RTC confused venue of a real action with jurisdiction. Its confusion
was puzzling, considering that it was well aware of the distinction between venue and jurisdiction, and
certainly knew that venue in civil actions was not jurisdictional and might even be waived by the
parties.44 To be clear, venue related only to the place of trial or the geographical location in which an
action or proceeding should be brought and does not equate to the jurisdiction of the court. It is
intended to accord convenience to the parties, as it relates to the place of trial, and does not restrict
their access to the courts.45 In contrast, jurisdiction refers to the power to hear and determine a
cause,46 and is conferred by law and not by the parties.47

By virtue of the concurrence of the elements of res judicata, the immediate dismissal of the Makati case
would have been authorized under Section 1, Rule 9 of the 1997 Rules of Civil Procedure,

The rule expressly mandated the Makati RTC to dismiss the case motu proprio once the pleadings or the
evidence on record indicated the pendency of the Manila case, or, later on, disclosed that the judgment
in the Manila case had meanwhile become final and executory.

Yet, we are appalled by the Makati RTC's flagrant disregard of the mandate.1âwphi1 Its reason for the
disregard was not well-founded. We stress that its disregard cannot be easily ignored because it
needlessly contributed to the clogging of the dockets of the Judiciary. Thus, we deem it to be imperative
to again remind all judges to consciously heed any clear mandate under the Rules of Court designed to
expedite the disposition of cases as well as to declog the court dockets.