PADERANGA vs BUISSAN

GR No. 49475, September 28, 1993

First Division
Bellosillo, J.,
Facts:

Paderanga and Elumba Industries entered into an oral contract of

lease for the use of a commercial space within a building owned
by Paderanga in Ozamis City. The lease was for an indefinite
period.

Paderanga subdivided the leased premises into two by

constructing a partition wall in between. He then took possession
of the other half with the acquiescence of the manager of
Elumba.

Elumba then filed an action for damages which at the same time,
praying for the fixing of the period of lease at five years, in CFI
(now RTC) of Zamboanga del Norte based in Dipolog City.

Paderanga, a resident in Ozamis City, moved for its dismissal

contending that the action was a real action which should have
been filed with CFI (RTC) of MIsamis Occidental where the
property in question is situated.
RTC

DENIED Motion to Dismiss

The case merely involved the enforcement of the contract
of lease; there was no question of
ownership raised.

Paderanga, on his motion for reconsideration, contended that

while the action did not involve a question of ownership, it was
nevertheless seeking recovery of possession, thus, it was a real
action.

RTC

DENIED Motion for reconsideration

While admitting that the case pray for recovery of
possession, such is not the main issue at hand

When case reached SC:

PADERANGA
Inasmuch Elumba seeks to recover
possession of the portion of real
property, the case should have
been filed in the CFI of Ozamis City.
It being a real action, venue is laid
in the court having jurisdiction over
the territory, in which property lies.

ELUMBA
The present action is chiefly for
damages arising fron an alleged
breach in the lease contract,
hence, the issue of recovery is
merely incidental. The action is
one in personam and not in rem.
Therefore venue may be laid in the

place where plaintiff or defendant

resides at the option of the
plaintiff.

ISSUE: Whether or not venue was properly laid in the CFI Dipolog
City
HELD: NO
Elumba appears to be confused over the difference between real action
and personal action vis-avis actions in personam and in rem.
The former determines venue; and the latter the binding effect of a
decision the court may render over the party, whether impleaded or not.
REAL ACTION

PERSONAL
ACTION

IN REM

Plaintiff seeks the

recovery of real
property, or an
action affecting
title to real
property, or for
the recovery of
possession, or for
partition, or
condemnation or
foreclosure of a
mortgage
VENUE: RTC
having
jurisdiction over
the territory in
which subject
property lies

Plaintiff seeks the

recovery of
personal property,
the enforcement of
a contract or the
recovery of
damages

An action
against a
person on the
basis of his
personal
liability

IN
PERSONA
M
An action
against the
thing itself,
instead of
against the
person

VENUE: RTC where

the defendant or
any of the
defendants
resides or may be
found, or where
the plaintiff or
any of the
plaintiffs resides

It is undubitable that the action instituted by Elumba against Paderanga

affects the parties alone, not the whole world. Hence, it is an action in
personam. However, this does not automatically mean that the action

for damages and to fix period of the lease contract is also a personal
action.
A personal action may not be necessarily be an action in
personam and a real action may not be at the same time be an
action in rem.
While it may be that instant complaint does not explicitly pray
for the recovery of possession, such is the necessary
consequence thereof. The instant action therefore does not operate to
efface the fundamental and prime objective of the nature of the case
which is to recover the one half portion repossessed by the lessor, herein

petitioner. Indeed, where the ultimate purpose of an action

involves title to, or seeks recovery of possession, partition or
condemnation of, or foreclosure of mortgage on real property,
such action must be deemed a real action and must perforce be
commenced and tried in the province where the property or any
part thereof is situated.
Therefore, RTC, in denying petitioners motion to dismiss, gravely abused
his discretion amounting to lack or excess of jurisdiction.