Emnace v.

CA (Class Reference)
EMILIO EMNACE, petitioner, vs. COURT OF APPEALS, ESTATE OF VICENTE
TABANAO, SHERWIN TABANAO, VICENTE WILLIAM TABANAO, JANETTE TABANAO
DEPOSOY, VICENTA MAY TABANAO VARELA, ROSELA TABANAO and VINCENT
TABANAO, respondents.
G.R. No. 126334; November 23, 2001; YNARES-SANTIAGO, J.:
FACTS: Petitioner Emilio Emnace, Vicente Tabanao and Jacinto Divinagracia were partners in
a business concern known as Ma. Nelma Fishing Industry. Sometime in January of 1986, they
decided to dissolve their partnership and executed an agreement of partition and
distribution of the partnership properties among them. Among the assets to be distributed
were five (5) fishing boats, six (6) vehicles, two (2) parcels of land. Throughout the existence
of the partnership, and even after Vicente Tabanaos untimely demise in 1994, Emnace failed
to submit to Tabanaos heirs any statement of assets and liabilities of the partnership, and to
render an accounting of the partnerships finances. Consequently, Tabanaos heirs,
respondents herein, filed against petitioner an action for accounting, payment of shares,
division of assets and damages. Petitioner filed a motion to dismiss the complaint on the
grounds of improper venue for lack of jurisdiction over the nature of the action or suit, lack
of jurisdiction because the docket fees were unpaid, lack of capacity of the estate of Tabanao
to sue, and that the action is already barred by prescription. The RTC denied the motion to
dismiss. The CA likewise upheld the RTCs action. Hence, this petition.
ISSUES: 1.) Whether or not the court may take cognizance of the case despite the failure to
pay the required docket fee;
2.) Whether or not there is lack of jurisdiction over the nature of the action;
3.) Whether or not the estate of the deceased may appear as party plaintiff, when there is
no intestate case and filed by one who was never appointed by the court as administratrix of
the estates; and
4.) Whether or not the case shall be dismissed on the ground of prescription.
HELD: 1.) The trial court erred in not dismissing the complaint outright despite their failure
to pay the proper docket fees. Nevertheless, as in other procedural rules, it may be liberally
construed in certain cases if only to secure a just and speedy disposition of an action. The
court acquires jurisdiction over the action if the filing of the initiatory pleading is
accompanied by the payment of the requisite fees, or, if the fees are not paid at the time of
the filing of the pleading, as of the time of full payment of the fees within such reasonable
time as the court may grant, unless, of course, prescription has set in the meantime.It does
not follow, however, that the trial court should have dismissed the complaint for failure of
private respondent to pay the correct amount of docket fees. Although the payment of the
proper docket fees is a jurisdictional requirement, the trial court may allow the plaintiff in an
action to pay the same within a reasonable time before the expiration of the applicable
prescriptive or reglementary period. If the plaintiff fails to comply within this requirement,
the defendant should timely raise the issue of jurisdiction or else he would be considered in
estoppel.
2.) NO. There is no error on the part of the trial court and the Court of Appeals in holding
that the case below is a personal action which, under the Rules, may be commenced and
tried where the defendant resides or may be found, or where the plaintiffs reside, at the
election of the latter. The records indubitably show that respondents are asking that the
assets of the partnership be accounted for, sold and distributed according to the agreement
of the partners. It is an action in personam because it is an action against a person, namely,

petitioner, on the basis of his personal liability. It is not an action in rem where the action is
against the thing itself instead of against the person. Furthermore, there is no showing that
the parcels of land involved in this case are being disputed. In fact, it is only incidental that
part of the assets of the partnership under liquidation happen to be parcels of land.
3.) YES. The surviving spouse does not need to be appointed as executrix or administratrix
of the estate before she can file the action. She and her children are complainants in their
own right as successors of Vicente Tabanao. From the very moment of Vicente Tabanaos
death, his rights insofar as the partnership was concerned were transmitted to his heirs, for
rights to the succession are transmitted from the moment of death of the decedent.
Whatever claims and rights Vicente Tabanao had against the partnership and petitioner were
transmitted to respondents by operation of law, more particularly by succession, which is a
mode of acquisition by virtue of which the property, rights and obligations to the extent of
the value of the inheritance of a person are transmitted.
4.) NO. Contrary to petitioners protestations that respondents right to inquire into the
business affairs of the partnership accrued in 1986, prescribing four (4) years thereafter,
prescription had not even begun to run in the absence of a final accounting. Applied in
relation to Articles 1807 and 1809, which also deal with the duty to account, the above-cited
provision states that the right to demand an accounting accrues at the date of dissolution in
the absence of any agreement to the contrary. When a final accounting is made, it is only
then that prescription begins to run. In the case at bar, no final accounting has been made,
and that is precisely what respondents are seeking in their action before the trial court, since
petitioner has failed or refused to render an accounting of the partnerships business and
assets. Hence, the said action is not barred by prescription.