I.

II.

III.

IV.

V.

Title:

Sps. Antonio and Leroncita Algura v. LGU

G.R. 150135, 30 October 2006

1. Property requirement (assessed value must not exceed P50k): the Sps met this
requirement since they have no real property under their name as certified by the
Assessors Office.

Doctrine
Rule 3, Section 21 enables the applicant to adduce evidence to show that they didnt have
property and money sufficient and available for food, shelter, and basic necessities for
them and their family. In that hearing, the adverse party has the right to also present
evidence to refute the allegations and evidence in support of the application of the
applicant to litigate as indigent litigants. If in fact the party declared indigent is a person
with sufficient money or property, the proper docket fees and other legal fees shall be
assessed and collected by the clerk of court.
Facts

Sps. Algura filed a verified complaint for damages with the RTC against the LGU of
Naga for the demolition of their boarding house and for payment of loss of income
for P7,000 paid by their boarders. Simultaneously, they filed an ex-parte motion for to
Litigate as Indigent litigants. Attached to their motion is Antonios pay slip showing a
gross monthly income of P10,474 and a net pay of P3000 and a certification from the
Naga City Assessor showing that the Sps. had no property under their name for
taxation purposes.

RTC: Granted plea for exemption fr. filing fees.

In their Answer, LGU of Naga contend that Sps. Algura had no cause of action since
their boarding house was a nuisance per se for blocking the road right of way. During
pre-trial, LGU asked for 5 days within which to file their motion to disqualify Sps. as
Indigent Litigants.

LGU then filed their motion to disqualify Sps. for non-payment of filing fees. It
asserted that the income of the Sps. (from Antonios income, computer shop and
boarding house) combined earned more than P3000 a month.

RTC: Disqualified Sps. as indigent litigants on the ground that they failed to
substantiate their claim for exemption from payment of legal fees and failure to
comply with requirements under Rule 141 Sec. 18 (1. gross income should be <
3k/m; 2. does not own real property with assessed value of > 50k.)

MR: Given opportunity to comply with reqs. under R141 S18.

Lorencitas Affidavit claimed that:

1) demolition resulted to loss of monthly income of P7K.
2) assessors office certified that they did not own any real property.
3) combined income insufficient to satisfy familys basic necessities.
4) Erlinda Bangates Affidavit (neighbor) supported Lorencitas claim.
5) Rule 3 Sec. 21 authorizes parties to litigate as indigents if that party has no
money or property sufficient to provide for the familys basic necessities.

RTC: Denied. Payslip showed gross income of P10k which is over the threshold req.
under Rule 141 Sec. 18 which is P3k/m. Re: Rule 3 Sec. 21, ignored and only applied
Rule 141 Sec. 18.

Hence, this petition for review on certiorari.

Issues
(1) Whether Sps. Algura should be considered as indigent litigants who qualify for
exemption from payment of legal fees. (NO)
(2) Whether the trial court has to apply both Rule 141 Sec. 16 and Rule 3 Sec. 21. (YES)
Held
(1) As stated by the RTC, using Rule 141 Sec. 18. There are 2 requirements to be
exempted from paying legal fees:

2. Income requirement (should not exceed P3k a month): the Sps. however failed to meet
this requirement since their gross income combined totaled P13, 4744. Which is clearly
over the P3k threshold.
The RTC correctly disqualified the Sps., however the RTC incorrectly applied Rule 141
Sec. 18 when the applicable rule was Rule 141 Sec. 16 (gross income should not exceed
P1500 and propertys assessed value not exceeding P18k).
(2) There are two rules existing on pauper litigants, Rule 3 Sec. 21 and Rule 141 Sec. 16
(amended by Rule 141 Sec. 18 then and subsequently amended by Rule 141 Sec. 19). Both
are valid and enforceable rules on indigent litigants. The fact that Rule 3 Sec. 21 on
indigent litigants was retained, even elaborating on the meaning of an indigent and further
strengthen the right to contest the grant of authority to litigate shows that there was no
intent to expunged said rule.
2 Rules can and should be harmonized. Both rules stand together and are compatible with
each other. Rule 141 Sec. 19 (formerly Rule 141 Sec. 16) provides for the specific
standards while Rule 3 Sec. 21 does not clearly draw the limits of entitlement to the
exemption.
Summarizing the rules, if the applicant meets the twin requirement (income and property
requirement) under Rule 141 Sec. 19, the grant of application is mandatory and grant is a
matter of right. However if the applicant fails to meet one or both of the requirements,
application should not be denied outright but the court should apply the indigency test
under Rule 3 Sec. 21 and use its sound discretion in determining the merits of the prayer
for exemption.
The trial court should have applied Rule 3 Sec. 21 to the application of Alguras after their
affidavits showed that they failed to meet the twin requirements. The trial court should
have called a hearing as required by Rule 3 Sec 21 to enable Alguras to adduce evidence to
show that they have no property and money sufficient to afford basic necessities of the
family. Further, LGU has the right to also present evidence to refute Alguras application.
Petition granted, orders of RTC are annulled and set aside. RTC is ordered to set the Exparte motion to litigate as Indigent Litigants for hearing and apply Rule 3 Sec. 21 to
determine whether Alguras can qualify as indigent litigants.\
Notes:

Legal fees were increased and adjusted by the Court.

Rule 141 Sec. 16 (gross income must not exceed 2k in MM and 1.5K outside MM;
propertys assessed value must not exceed 24k in MM and 18k outside MM).
After amendment, it became Rule 141 Sec 18 (gross income must not exceed 4k in MM
and 3K outside MM; propertys assessed value must not exceed 50k).
The latter was further amended making it Rule 141 Sec. 19 (indigent litigants gross
income and that of his immediate family must not exceed an amount double the monthly
minimum wage; must not own real property with a fair market value as stated in the tax
declaration of more than 300k.