ARMAND NOCUM and THE G.R. No.

145022
PHILIPPINE DAILY INQUIRER,
INC., Present:
P e t i t i o n e r s,
PUNO,
Chairman,
AUSTRIA-MARTINEZ,
CALLEJO, SR.
- versus - TINGA, and
CHICO-NAZARIO, JJ.

Promulgated:
LUCIO TAN,
R e s p o n d e n t. September 23, 2005
X--------------------------------------------------X

CHICO-NAZARIO, J.:

Assailed in a 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, Branch 56, in Civil Case No. 98-2288, dated 19 April 1999, admitting respondent Lucio
Tans 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.

The antecedents are summarized by the Court of Appeals.

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 plaintiffs or PALs side of the dispute with the pilots 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; (2) venue was improperly laid; 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. In par. 2.01.1 of the amended complaint, it is alleged that 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 (p. 55, id.).

The lower court, after having the case dismissed for improper venue, admitted the
amended complaint and deemed set aside the previous order of dismissal, supra, stating, inter
alia, that:

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. Besides, there is no substantial amendment in the
Amended Complaint which would affect the defendants defenses and 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 dated 15 September 2000.

Both petitioners and defendants Umali and ALPAP appealed to this Court. Under consideration is the
petition for review filed by petitioners.

On 11 December 2000, the Court required respondent Tan to comment on the petition filed by
petitioners.[3]

Respondent filed his comment on 22 January 2001[4] to which petitioners filed a reply on 26 April
[5]
2001.

In a Manifestation filed on 19 February 2001, respondent stated that the petition[6] filed by defendants
Umali and ALPAP has already been denied by the Court in a resolution dated 17 January 2001.[7]
 On 20 August 2003, the Court resolved to give due course to the petition and required the parties to
submit their respective memoranda within thirty (30) days from notice.[8] Both petitioners and respondent
complied.[9]

Petitioners assigned the following as errors:

A. THE COURT OF APPEALS ERRED IN RULING (1) THAT THE LOWER COURT HAD
JURISDICTION OVER THE CASE (ON THE BASIS OF THE ORIGINAL
COMPLAINT) NOTWITHSTANDING THE FACT THAT THE LOWER COURT HAD
EARLIER DISMISSED THE ORIGINAL COMPLAINT FOR ITS FAILURE TO
CONFER JURISDICTION UPON THJE COURT; AND (2) THAT THE AMENDED
COMPLAINT WAS PROPERLY ALLOWED OR ADMITTED BECAUSE THE LOWER
COURT WAS NEVER DIVESTED OF JURISDICTION OVER THE CASE;

B. THE COURT OF APPEALS ERRED IN NOT RULING THAT THE ORIGINAL

COMPLAINT OF RESPONDENT WAS AMENDED PURPOSELY TO CONFER UPON
THE LOWER COURT JURISDICTION OVER THE CASE.[10]

Petitioners state that Article 360 of the Revised Penal Code vests jurisdiction over all civil and criminal
complaints for libel on the RTC of the place: (1) where the libelous article was printed and first published; or
(2) where the complainant, if a private person, resides; or (3) where the complainant, if a public official, holds
office. They argue that since the original complaint only contained the office address of respondent and not the
latters actual residence or the place where the allegedly offending news reports were printed and first published,
the original complaint, by reason of the deficiencies in its allegations, failed to confer jurisdiction on the lower
court.

The question to be resolved is: Did the lower court acquire jurisdiction over the civil case upon the filing
of the original complaint for damages?

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. [11] 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, respondents 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.[13]

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 respondents failure to
include the same in the original complaint divest the lower court of its jurisdiction over the case. Respondents
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.

1. 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.

2. 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.

3. 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.

4. 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.

We further restated[18] the rules on venue in Article 360 as follows:

1. Whether the offended party is a public official or a private person, the criminal action
may be filed in the Court of First Instance of the province or city where the libelous article is
printed and first published.

2. If the offended party is a private individual, the criminal action may also be filed in the
Court of First Instance of the province where he actually resided at the time of the commission of
the offense.

3. If the offended party is a public officer whose office is in Manila at the time of the
commission of the offense, the action may be filed in the Court of First Instance of Manila.

4. If the offended party is a public officer holding office outside of Manila, the action
may be filed in the Court of First Instance of the province or city where he held office at the time
of the commission of the offense.

We fully agree with the Court of Appeals when it ruled:

 We note that the amended complaint or amendment to the complaint was not intended to
vest jurisdiction to the lower court, where originally it had none. The amendment was merely to
establish the proper venue for the action. It is a well-established rule that venue has nothing to do
with jurisdiction, except in criminal actions. Assuming that venue were properly laid in the court
where the action was instituted, that would be procedural, not a jurisdictional impediment. In
fact, in civil cases, venue may be waived.

Consequently, by dismissing the case on the ground of improper venue, the lower court
had jurisdiction over the case. Apparently, the herein petitioners recognized this jurisdiction by
filing their answers to the complaint, albeit, questioning the propriety of venue, instead of a
motion to dismiss.

...

We so hold that dismissal of the complaint by the lower court was proper considering that
the complaint, indeed, on its face, failed to allege neither the residence of the complainant nor
the place where the libelous article was printed and first published. Nevertheless, before the
finality of the dismissal, the same may still be amended as in fact the amended complaint was
admitted, in view of the court a quos jurisdiction, of which it was never divested. In so doing, the
court acted properly and without any grave abuse of discretion.[19]

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.[20] 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. [21] It is
meant to provide convenience to the parties, rather than restrict their access to the courts as it relates to the place
of trial.[22] 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.

The cases[24] cited by petitioners are not applicable here. These cases involve amendments on complaints
that confer jurisdiction on courts over which they originally had none. This is not true in the case at bar. 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.

WHEREFORE, the foregoing considered, the decision of the Court of Appeals dated 19 April 2000 is
AFFIRMED in toto. No costs.

SO ORDERED.

FIRST DIVISION
HEIRS OF VALERIANO S. CONCHA, G.R. No. 158121
SR. NAMELY: TERESITA CONCHA-
PARAN, VALERIANO P. CONCHA,
JR., RAMON P. CONCHA, EDUARDO
P. CONCHA, REPRESENTED BY HIS
LEGAL GUARDIAN, REYNALDO P.
CONCHA, ALBERTO P. CONCHA,
BERNARDO P. CONCHA and GLORIA Present:
P. CONCHA-NUNAG,
Petitioners, PUNO, C.J., Chairperson,
YNARES-SANTIAGO,
SANDOVAL-GUTIERREZ,
- versus - CORONA, and
AZCUNA, JJ.
SPOUSES GREGORIO J. LUMOCSO[1]
and BIENVENIDA GUYA, CRISTITA
J. LUMOCSO VDA. DE DAAN, AND
SPOUSES JACINTO J. LUMOCSO Promulgated:
and BALBINA T. LUMOCSO,[2]
Respondents. December 12, 2007

x--------------------------------------------------x

DECISION

PUNO, C.J.:

On appeal by certiorari under Rule 45 of the Rules of Court are the

[3] [4]
decision and resolution of the Court of Appeals (CA) in CA-G.R. SP No. 59499, annulling the
resolutions[5] and order[6] of the Regional Trial Court (RTC) of Dipolog City, Branch 9, in Civil Case Nos.
5188, 5433 and 5434 which denied the separate motions to dismiss and Joint Motion for Reconsideration filed
by the respondents.

The relevant facts are undisputed.

Petitioners, heirs of spouses Dorotea and Valeriano Concha, Sr., claim to be the rightful owners of Lot
No. 6195 (Civil Case No. 5188), a one-hectare portion of Lot No. 6196-A (Civil Case No. 5433), and a one-
hectare portion of Lot Nos. 6196-B and 7529-A (Civil Case No. 5434), all situated in Cogon, Dipolog City,
under Section 48(b) of Commonwealth Act No. 141 (C.A. No. 141), otherwise known as the Public Land
Act. Respondent siblings Gregorio Lumocso (Civil Case No. 5188), Cristita Lumocso Vda. de Daan (Civil
Case No. 5433) and Jacinto Lumocso (Civil Case No. 5434), are the patent holders and registered owners of the
subject lots.

The records show that on August 6, 1997, Valeriano Sr.[7] and his children, petitioners Valeriano Jr.,
Ramon, Eduardo, Alberto, Bernardo, Teresita, Reynaldo, and Gloria, all surnamed Concha, filed a complaint for
Reconveyance and/or Annulment of Title with Damages against "Spouses Gregorio Lomocso and Bienvenida
Guya." They sought to annul Free Patent No. (IX-8)985 and the corresponding Original Certificate of Title
(OCT) No. P-22556 issued in the name of "Gregorio Lumocso" covering Lot No. 6195. The case was raffled to
the RTC of Dipolog City, Branch 9, and docketed as Civil Case No. 5188. In their Amended
Complaint, petitioners prayed that judgment be rendered:
 1. Declaring Free Patent No. (IX-8)985 and Original Certificate of Title No. 22556 issued
to defendants as null and void ab initio;

2. Declaring Lot No. 6195 or 1.19122-hectare as private property of the plaintiffs under
Sec. 48(b) of CA No. 141 otherwise known as the Public Land Act as amended by RA 1942;

3. Ordering the defendant Lomocsos to reconvey the properties (sic) in question Lot No.
6195 or the 1.19122 hectares in favor of the plaintiffs within 30 days from the finality of the decision in
this case and if they refuse, ordering the Clerk of Court of this Honorable Court to execute the deed of
reconveyance with like force and effect as if executed by the defendant[s] themselves;

4. Ordering defendant Lomocsos to pay P60,000.00 for the 21 forest trees illegally
cut; P50,000.00 for moral damages; P20,000.00 for Attorneys fees; P20,000.00 for litigation expenses;
and to pay the cost of the proceedings;

5. Declaring the confiscated three (sic) flitches kept in the area of the plaintiffs at
Dampalan San Jose, Dipolog with a total volume of 2000 board feet a[s] property of the plaintiff [they]
being cut, collected and taken from the land possessed, preserved, and owned by the plaintiffs;

6. The plaintiffs further pray for such other reliefs and remedies which this Honorable
Court may deem just and equitable in the premises.[8]

On September 3, 1999, two separate complaints for Reconveyance with Damages were filed by
petitioners,[9] this time against "Cristita Lomocso Vda. de Daan" for a one-hectare portion of Lot No. 6196-A
and "Spouses Jacinto Lomocso and Balbina T. Lomocso" for a one-hectare portion of Lot Nos. 6196-B and
7529-A. The two complaints were also raffled to Branch 9 of the RTC of Dipolog City and docketed as Civil
Case Nos. 5433 and 5434,
respectively. In Civil Case No. 5433, petitioners prayed that judgment be rendered:

1. Declaring [a] portion of Lot 6196-A titled under OCT (P23527) 4888 equivalent to one
hectare located at the western portion of Lot 4888 as private property of the plaintiffs under Sec. 48(B)
CA 141 otherwise known as Public Land OCT (sic) as amended by RA No. 1942;

2. Ordering the defendant to reconvey the equivalent of one (1) hectare forested portion of her
property in question in favor of the plaintiffs within 30 days from the finality of the decision in this case
segregating one hectare from OCT (P23527) 4888, located at its Western portion and if she refuse (sic),
ordering the Clerk of Court of this Honorable Court to execute the deed of reconveyance with like force
and effect, as if executed by the defenda[n]t herself;

3. Ordering defendant to pay P30,000.00 for the 22 forest trees illegally cut; P20,000.00 for
moral damages; P20,000.00 for Attorney's fees; P20,000.00 for litigation expenses; and to pay the cost
of the proceedings.[10]

In Civil Case No. 5434, petitioners prayed that judgment be rendered:

1. Declaring [a] portion of Lot 7529-A under OCT (P-23207) 12870 and Lot 6196-B OCT (P-
20845) 4889 equivalent to one hectare located as (sic) the western portion of said lots as private property
of the plaintiffs under Sec. 48(b) of [C.A. No.] 141 otherwise know[n] as the [P]ublic [L]and [A]ct as
amended by RA 1942;

2. Ordering the defendants to reconvey the equivalent of one (1) hectare forested portion of their
properties in question in favor of the plaintiffs within 30 days from the finality of the decision in this
case segregating one hectare from OCT (P-23207) 12870 and OCT (T-20845)-4889 all of defendants,
 located at its Western portion and if they refuse, ordering the Clerk of Court of this Honorable Court to
execute the deed of reconveyance with like force and effect as if executed by the defendants
themselves[;]

3. Ordering defendants to pay P20,000.00 for the six (6) forest trees illegally cut; P20,000.00 for
moral damages; P20,000.00 for Attorney's fees; P20,000.00 for litigation expenses; and to pay the cost
of the proceedings.[11]

The three complaints[12] commonly alleged: a) that on May 21, 1958, petitioners' parents (spouses
Valeriano Sr. and Dorotea Concha) acquired by homestead a 24-hectare parcel of land situated in Cogon,
Dipolog City; b) that since 1931, spouses Concha "painstakingly preserved" the forest in the 24-hectare land,
including the excess four (4) hectares "untitled forest land" located at its eastern portion; c) that they possessed
this excess 4 hectares of land (which consisted of Lot No. 6195, one-hectare portion of Lot No. 6196-A and
one-hectare portion of Lot Nos. 6196-B and 7529-A) "continuously, publicly, notoriously, adversely,
peacefully, in good faith and in concept of the (sic) owner since 1931;" d) that they continued possession and
occupation of the 4-hectare land after the death of Dorotea Concha on December 23, 1992 and Valeriano Sr. on
May 12, 1999; e) that the Concha spouses "have preserved the forest trees standing in [the subject lots] to the
exclusion of the defendants (respondents) or other persons from 1931" up to November 12, 1996 (for Civil Case
No. 5188) or January 1997 (for Civil Case Nos. 5433 and 5434) when respondents, "by force, intimidation,
[and] stealth forcibly entered the premises, illegally cut, collected, [and] disposed" of 21 trees (for Civil Case
No. 5188), 22 trees (for Civil Case No. 5433) or 6 trees (for Civil Case No. 5434); f) that "the land is private
land or that even assuming it was part of the public domain, plaintiffs had already acquired imperfect title
thereto" under Sec. 48(b) of C.A. No. 141, as amended by Republic Act (R.A.) No. 1942; g) that respondents
allegedly cut into flitches the trees felled in Lot No. 6195 (Civil Case No. 5188) while the logs taken from the
subject lots in Civil Case Nos. 5433 and 5434 were sold to a timber dealer in Katipunan, Zamboanga del
Norte; h) that respondents "surreptitiously" filed free patent applications over the lots despite their full
knowledge that petitioners owned the lots; i) that the geodetic engineers who conducted the original survey over
the lots never informed them of the
survey to give them an opportunity to oppose respondents' applications; j) that respondents' free patents and the
corresponding OCTs were issued "on account of fraud, deceit, bad faith and misrepresentation"; and k) that the
lots in question have not been transferred to an innocent purchaser.

On separate occasions, respondents moved for the dismissal of the respective cases against them on the
same grounds of: (a) lack of jurisdiction of the RTC over the subject matters of the complaints; (b) failure to
state causes of action for reconveyance; (c) prescription; and (d) waiver, abandonment, laches and
estoppel.[13] On the issue of jurisdiction, respondents contended that the RTC has no jurisdiction over the
complaints pursuant to Section 19(2) of Batas Pambansa Blg. (B.P.) 129, as amended by R.A. No. 7691, as in
each case, the assessed values of the subject lots are less than P20,000.00.

Petitioners opposed,[14] contending that the instant cases involve actions the subject matters of which are
incapable of pecuniary estimation which, under Section 19(1) of B.P. 129, as amended by R.A. 7691, fall within
the exclusive original jurisdiction of the RTCs. They also contended that they have two main causes of
action: for reconveyance and for recovery of the value of the trees felled by respondents. Hence, the totality of
the claims must be considered which, if computed, allegedly falls within the exclusive original jurisdiction of
the RTC.

The trial court denied the respective motions to dismiss of respondents.[15] The respondents filed a Joint
Motion for Reconsideration,[16] to no avail.[17]

Dissatisfied, respondents jointly filed a Petition for Certiorari, Prohibition and Preliminary Injunction with
Prayer for Issuance of Restraining Order Ex Parte[18]with the CA, docketed as CA-G.R. SP No. 59499. In its
Decision,[19] the CA reversed the resolutions and order of the trial court. It held that even assuming that the
complaints state a cause of action, the same have been barred by the statute of limitations. The CA ruled that an
action for reconveyance based on fraud prescribes in ten (10) years, hence, the instant complaints must be
dismissed as they involve titles issued for at least twenty-two (22) years prior to the filing of the
complaints. The CA found it unnecessary to resolve the other issues.

Hence, this appeal in which petitioners raise the following issues, viz:

FIRST - WHETHER OR NOT RESPONDENT COURT OF APPEALS (FORMER FIRST DIVISION)

ERRED IN REVERSING THE ORDER OF THE COURT A QUO DENYING THE MOTION FOR
DISMISSAL, CONSIDERING THE DISMISSAL OF A PARTY COMPLAINT IS PREMATURE
AND TRIAL ON THE MERITS SHOULD BE CONDUCTED TO THRESH OUT EVIDENTIARY
MATTERS.

SECOND - WHETHER OR NOT THE RESPONDENT COURT OF APPEALS (FORMER FIRST

DIVISION) ERRED IN DISMISSING THE PETITIONERS' COMPLAINTS ON [THE] GROUND OF
PRESCRIPTION.

THIRD - WHETHER OR NOT THE RESPONDENT COURT OF APPEALS (FORMER FIRST

DIVISION) ERRED IN CONCLUDING THAT THERE IS NO DOCUMENTARY EVIDENCE ON
RECORD TO SHOW THAT PETITIONERS OWN THE SUBJECT FOREST
PORTION OF THE PROPERTIES ERRONEOUSLY INCLUDED IN THE TITLES OF PRIVATE
RESPONDENTS.

FOURTH - WHETHER OR NOT THE PETITION OF HEREIN PRIVATE RESPONDENTS FILED

WITH THE RESPONDENT COURT OF APPEALS (FORMER FIRST DIVISION) SHOULD HAVE
BEEN DISMISSED OUTRIGHTLY FOR PRIVATE RESPONDENTS' THEREIN FAILURE TO
COMPLY WITH THE MANDATORY REQUIREMENT OF SECTION 1 RULE 65 OF THE RULES
OF COURT TO SUBMIT CERTIFIED TRUE COPIES OF THE ASSAILED ORDERS OF THE
TRIAL COURT WHICH RENDERED THEIR PETITION (CA G.R. 59499) DEFICIENT IN FORM
AND SUBSTANCE CITING THE CASE OF CATUIRA VS. COURT OF APPEALS (172 SCRA
136).[20]

In their memorandum,[21] respondents reiterated their arguments in the courts below that: a) the
complaints of the petitioners in the trial court do not state causes of action for reconveyance; b) assuming the
complaints state causes of action for reconveyance, the same have already been barred by prescription; c) the
RTC does not have jurisdiction over the subject matter of the instant cases; d) the claims for reconveyance in
the complaints are barred by waiver, abandonment, or otherwise extinguished by laches and estoppel; and e)
there is no special reason warranting a review by this Court.

Since the issue of jurisdiction is determinative of the resolution of the instant case yet the CA skirted the
question, we resolved to require the parties to submit their respective Supplemental Memoranda on the issue of
jurisdiction.[22]

In their Supplemental Memorandum,[23] petitioners contend that the nature of their complaints, as
denominated therein and as borne by their allegations, are suits for reconveyance, or annulment or cancellation
of OCTs and damages. The cases allegedly involve more than just the issue of
title and possession since the nullity of the OCTs issued to respondents and the reconveyance of the subject
properties were also raised as issues. Thus, the RTC has jurisdiction under Section 19(1) of B.P. 129, which
provides that the RTC has jurisdiction "[i]n all civil actions in which the subject of the litigation is incapable of
pecuniary estimation." Petitioners cited: a) Raymundo v. CA[24] which set the criteria for determining whether
an action is one not capable of pecuniary estimation; b) Swan v. CA[25] where it was held that an action for
annulment of title is under the jurisdiction of the RTC; c) Santos v. CA[26] where it was similarly held that an
action for annulment of title, reversion and damages was within the jurisdiction of the RTC; and
d) Commodities Storage and ICE Plant Corporation v. CA[27]where it was held that "[w]here the action
affects title to the property, it should be filed in the RTC where the property is located." Petitioners also contend
that while it may be argued that the assessed values of the subject properties are within the original jurisdiction
of the municipal trial court (MTC), they have included in their prayers "any interest included therein" consisting
of 49 felled natural grown trees illegally cut by respondents. Combining the assessed values of the properties as
shown by their respective tax declarations and the estimated value of the trees cut, the total amount prayed by
petitioners exceeds twenty thousand pesos (P20,000.00).Hence, they contend that the RTC has jurisdiction
under Section 19(2) of B.P. 129.

Jurisdiction over the subject matter is the power to hear and determine cases of the general class to
which the proceedings in question belong.[28] It is conferred by law and an objection based on this ground
cannot be waived by the parties.[29] To determine whether a court has jurisdiction over the subject matter of a
case, it is important to determine the nature of the cause of action and of the relief sought.[30]

The trial court correctly held that the instant cases involve actions for reconveyance. [31] An action for
reconveyance respects the decree of registration as incontrovertible but seeks the transfer of property, which has
been wrongfully or erroneously registered in other persons' names, to its rightful and legal owners, or to those
who claim to have a better right.[32] There is no special ground for an action for reconveyance. It is enough that
the aggrieved party has a legal claim on the property superior to that of the registered owner[33] and that the
property has not yet passed to the hands of an innocent purchaser for value.[34]

The reliefs sought by the petitioners in the instant cases typify an action for reconveyance. The
following are also the common allegations in the three complaints that are sufficient to constitute causes of
action for reconveyance, viz:

(a) That plaintiff Valeriano S. Concha, Sr. together with his spouse Dorotea Concha have
painstakingly preserve[d] the forest standing in the area [of their 24-hectare homestead] including the
four hectares untitled forest land located at the eastern portion of the forest from 1931 when they were
newly married, the date they acquired this property by occupation or possession;[35]

(b) That spouses Valeriano S. Concha Sr. and Dorotea P. Concha have preserved the forest trees
standing in [these parcels] of land to the exclusion of the defendants Lomocsos or other persons from
1931 up to November 12, 1996 [for Civil Case No. 5188] and January 1997 [for Civil Case Nos. 5433
and 5434] when defendants[,] by force, intimidation, [and] stealth[,] forcibly entered the premises,
illegal[ly] cut, collected, disposed a total of [twenty-one (21) trees for Civil Case No. 5188, twenty-two
(22) trees for Civil Case No. 5433 and six (6) trees for Civil Case No. 5434] of various sizes; [36]

(c) That this claim is an assertion that the land is private land or that even assuming it was part
of the public domain, plaintiff had already acquired imperfect title thereto under Sec. 48(b) of [C.A.] No.
141[,] otherwise known as the Public Land Act[,] as amended by [R.A.] No. [7691];[37]

(d) That [respondents and their predecessors-in-interest knew when they] surreptitiously
filed[38] [their respective patent applications and were issued their respective] free patents and original
certificates of title [that the subject lots belonged to the petitioners];[39]

(e) [That respondents' free patents and the corresponding original certificates of titles were
issued] on account of fraud, deceit, bad faith and misrepresentation;[40] and

(f) The land in question has not been transferred to an innocent purchaser.[41]

These cases may also be considered as actions to remove cloud on one's title as they are intended to
procure the cancellation of an instrument constituting a claim on petitioners' alleged title which was used to
injure or vex them in the enjoyment of their alleged title.[42]
 Being in the nature of actions for reconveyance or actions to remove cloud on one's title, the applicable
law to determine which court has jurisdiction is Section 19(2) of B.P. 129, as amended by R.A. No. 7691, viz:

Section 19. Jurisdiction in Civil Cases.-- Regional Trial Courts shall exercise exclusive original
jurisdiction: x x x

(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;

x x x.

In the cases at bar, it is undisputed that the subject lots are situated in Cogon, Dipolog City and their
assessed values are less than P20,000.00, to wit:

Civil Case No. Lot No. Assessed Value

5188 6195 P1,030.00

5433 6196-A 4,500.00

5434 6196-B 4,340.00

7529-A 1,880.00.[43]

Hence, the MTC clearly has jurisdiction over the instant cases.

Petitioners' contention that this case is one that is incapable of pecuniary estimation under the exclusive
original jurisdiction of the RTC pursuant to Section 19(1) of B.P. 129 is erroneous.

In a number of cases, we have held that actions for reconveyance[44] of or for cancellation of title[45] to or
to quiet title[46] over real property are actions that fall under the classification of cases that involve "title to, or
possession of, real property, or any interest therein."

The original text of Section 19(2) of B.P. 129 as well as its forerunner, Section 44(b) of R.A. 296,[47] as
amended, gave the RTCs (formerly courts of first instance) exclusive original jurisdiction "[i]n all civil
actions which involve the title to, or possession of, real property, or any interest therein, except actions for
forcible entry into and unlawful detainer of lands or buildings, original jurisdiction over which is conferred
upon Metropolitan Trial Courts, [MTCs], and Municipal Circuit Trial Courts (conferred upon the city and
municipal courts under R.A. 296, as amended)." Thus, under the old law, there was no substantial effect on
jurisdiction whether a case is one, the subject matter of which was incapable of pecuniary estimation, under
Section 19(1) of B.P. 129 or one involving title to property under Section 19(2). The distinction between the
two classes became crucial with the amendment introduced by R.A. No. 7691[48] in 1994 which 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 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 (P50,000.00) exclusive of interest, damages of
whatever kind, attorney's fees, litigation expenses and costs." Thus, under the present law, original
jurisdiction over cases the subject matter of which involves "title to, possession of, real property or any interest
therein" under Section 19(2) of B.P. 129 is divided between the first and second level courts, with the assessed
value of the real property involved as the benchmark. This amendment was introduced to "unclog the
overloaded dockets of the RTCs which would result in the speedier administration of justice."[49]

The cases of Raymundo v. CA[50] and Commodities Storage and ICE Plant Corporation v.
[51]
CA, relied upon by the petitioners, are inapplicable to the cases at bar. Raymundo involved a complaint for
mandatory injunction, not one for reconveyance or annulment of title. The bone of contention was whether the
case was incapable of pecuniary estimation considering petitioner's contention that the pecuniary claim of the
complaint was only attorney's fees of P10,000, hence, the MTC had jurisdiction. The Court defined the criterion
for determining whether an action is one that is incapable of pecuniary estimation and held that the issue of
whether petitioner violated the provisions of the Master Deed and Declaration of Restriction of the Corporation
is one that is incapable of pecuniary estimation. The claim for attorney's fees was merely incidental to the
principal action, hence, said amount was not determinative of the court's jurisdiction. Nor can Commodities
Storage and ICE Plant Corporation provide any comfort to petitioners for the issue resolved by the Court in
said case was venue and not jurisdiction. The action therein was for damages, accounting and fixing of
redemption period which was filed on October 28, 1994, before the passage of R.A. No. 7691. In resolving the
issue of venue, the Court held that "[w]here the action affects title to property, it should be instituted in the
[RTC] where the property is situated. The Sta. Maria Ice Plant & Cold Storage is located in Sta. Maria,
Bulacan. The venue in Civil Case No. 94-727076 was therefore improperly laid."

Worse, the cases of Swan v. CA[52] and Santos v. CA[53] cited by the petitioners, contradict their own
position that the nature of the instant cases falls under Section 19(1) of B.P. 129. The complaints
in Swan and Santos were filed prior to the enactment of R.A. No. 7691. In Swan, the Court held that the action
being one for annulment of title, the RTC had original jurisdiction under Section 19(2) of B.P. 129. In Santos,
the Court similarly held that the complaint for cancellation of title, reversion and damages is also one that
involves title to and possession of real property under Section 19(2) of B.P. 129. Thus, while the Court held
that the RTC had jurisdiction, the Court classified actions for "annulment of title" and "cancellation of title,
reversion and damages" as civil actions that involve "title to, or possession of, real property, or any interest
therein" under Section 19(2) of B.P. 129.

Petitioners' contention that the value of the trees cut in the subject properties constitutes "any interest
therein (in the subject properties)" that should be computed in addition to the respective assessed values of the
subject properties is unavailing. Section 19(2) of B.P. 129, as amended by R.A. No. 7691, is clear that the RTC
shall exercise jurisdiction "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)." It is true that the recovery of the value of the trees cut from the subject properties may be
included in the term "any interest therein." However, the law is emphatic that in determining which court has
jurisdiction, it is only the assessed value of the realty involved that should be computed. [54] In this case, there is
no dispute that the assessed values of the subject properties as shown by their tax declarations are less
than P20,000.00. Clearly, jurisdiction over the instant cases belongs not to the RTC but to the MTC.

IN VIEW WHEREOF, the decision of the Court of Appeals is hereby AFFIRMED that the RTC of
Dipolog City, Branch 9, has no jurisdiction in Civil Case Nos. 5188, 5433 and 5434. No costs.

THIRD DIVISION
 G.R. No. 164560
ANA DE GUIA SAN PEDRO
and ALEJO DOPEO,
Petitioners, Present:

YNARES-SANTIAGO, J.,
- versus - Chairperson,
CHICO-NAZARIO,
VELASCO, JR.,
HON. FATIMA G. ASDALA, in her
NACHURA, and
capacity as the Presiding Judge of the
PERALTA, JJ.
Regional Trial Court of Quezon City,
Branch 87; HON. MANUEL TARO, in his
capacity as the Presiding Judge of the
Metropolitan Trial Court of Quezon City,
Branch 42; and the HEIRS OF SPOUSES
APOLONIO V. DIONISIO and
VALERIANA DIONISIO (namely, ALLAN
GEORGE R. DIONISIO and ELEANOR
R. DIONISIO, herein represented by
ALLAN GEORGE R. DIONISIO), Promulgated:
Respondents.
July 22, 2009
x - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION

PERALTA, J.:

This resolves the petition for certiorari under Rule 65 of the Rules of Court, praying that the
Resolutions[1] of the Court of Appeals (CA) dated September 15, 2003 and June 1, 2004, respectively, in CA-
G.R. SP No. 78978, be reversed and set aside.
The antecedent facts are as follows.

Sometime in July 2001, private respondents, heirs of spouses Apolonio and Valeriana Dionisio, filed with the
Metropolitan Trial Court (MeTC) of Quezon City, Branch 42, a Complaint[2] against herein petitioners and
Wood Crest Residents Association, Inc., for Accion Reivindicatoria, Quieting of Title and Damages, with
Prayer for Preliminary Mandatory Injunction. Private respondents alleged that subject property located in
Batasan Hills, Quezon City, with an assessed value of P32,100.00, was titled in the name of spouses Apolonio
and Valeriana Dionisio; but petitioners, with malice and evident bad faith, claimed that they were the owners of
a parcel of land that encompasses and covers subject property. Private respondents had allegedly been prevented
from entering, possessing and using subject property. It was further alleged in the Complaint that petitioners'
Transfer Certificate of Title over their alleged property was spurious. Private respondents then prayed that they
be declared the sole and absolute owners of the subject property; that petitioners be ordered to surrender
possession of subject property to them; that petitioners and Wood Crest and/or its members be ordered to pay
actual and moral damages, and attorney's fees.

Petitioners, for their part, filed a Motion to Dismiss[3] said complaint on the ground that the MeTC had no
jurisdiction over the subject matter of the action, as the subject of litigation was incapable of pecuniary
estimation.
The MeTC then issued an Order[4] dated July 4, 2002 denying the motion to dismiss, ruling that, under Batas
Pambansa (B.P.) Blg. 129, as amended, the MeTC had exclusive original jurisdiction over actions
involving title to or possession of real property of small value.

Petitioners' Motion for Reconsideration of said Order dated July 4, 2002 was denied.

Petitioners assailed the aforementioned Order by filing a petition for certiorari with the Regional Trial Court
(RTC) of Quezon City, Branch 87. However, in its Decision[5] dated March 10, 2003, the RTC dismissed the
petition, finding no grave abuse of discretion on the part of the MeTC Presiding Judge. The RTC sustained the
MeTC ruling, stating that, in accordance with Section 33(3) of Republic Act (R.A.) No. 7691, amending B.P.
Blg. 129, the MeTC had jurisdiction over the complaint for Accion Reivindicatoria, as it involves recovery of
ownership and possession of real property located in Quezon City, with an assessed value not
exceeding P50,000.00. A Motion for Reconsideration[6] of the Decision was filed by petitioners, but was denied
in an Order[7] dated July 3, 2003.

Petitioners then filed with the Court of Appeals another petition for certiorari, insisting that both the MeTC and
RTC acted with grave abuse of discretion amounting to lack or excess of jurisdiction by not ordering the
dismissal of the complaint for Accion Reivindicatoria, for lack of jurisdiction over the same. In the assailed CA
Resolution dated September 15, 2003, the CA dismissed the petition outright, holding that certiorari was not
available to petitioners as they should have availed themselves of the remedy of appeal. Petitioners' motion for
reconsideration of the resolution of dismissal was denied per Resolution[8] dated June 1, 2004.

Thus, petitioners filed the instant petition and, in support thereof, they allege that:

THE HONORABLE COURT OF APPEALS ACTED WITH GRAVE ABUSE OF

DISCRETION AMOUNTING TO LACK OR IN (SIC) EXCESS OF JURISDICTION IN
DENYING THE PETITION FOR CERTIORARI AND FOR FAILURE TO RESOLVE THE
ISSUE RAISED IN THE CERTIORARI REGARDING THE JURISDICTION OF THE
METROPOLITAN TRIAL COURT TO TAKE COGNIZANCE OF A CASE OF ACCION
REINVINDICATORIA.

THE HONORABLE PUBLIC RESPONDENT FATIMA GONZALES-ASDALA, AS

PRESIDING JUDGE OF RTC BRANCH 87, QUEZON CITY, ACTED WITH GRAVE
ABUSE OF DISCRETION AMOUNTING TO LACK OR IN EXCESS OF (SIC)
JURISDICTION IN DISMISSING THE PETITION FOR CERTIORARI AND IN RESOLVING
THAT A CASE OF ACCION REINVINDICATORIA IS WITHIN THE JURISDICTION OF
THE METROPOLITAN TRIAL COURT.

THE HONORABLE PUBLIC RESPONDENT MANUEL TARO AS PRESIDING JUDGE

MeTC, BRANCH 42, QUEZON CITY, ACTED WITH GRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK OR IN (SIC) EXCESS OF JURISDICTION IN SO TAKING
COGNIZANCE OF THE COMPLAINT FOR ACCION REINVINDICATORIA IN CIVIL CASE
NO. 27434 ENTITLED, HEIRS OF SPS. APOLONIO V. DIONISIO AND VALERIANA
DIONISIO, ETC. VS. ANA DE GUIA SAN PEDRO, ET. AL.[9]

The present Petition for Certiorari is doomed and should not have been entertained from the very beginning.
The settled rule is that appeals from judgments or final orders or resolutions of the CA should be by a verified
petition for review on certiorari, as provided for under Rule 45 of the Revised Rules of Civil Procedure. Thus,
in Pasiona, Jr. v. Court of Appeals,[10] the Court expounded as follows:

The aggrieved party is proscribed from assailing a decision or final order of the CA via Rule 65,
because such recourse is proper only if the party has no plain, speedy and adequate remedy in the
course of law. In this case, petitioner had an adequate remedy, namely, a petition for review
on certiorari under Rule 45 of the Rules of Court. A petition for review on certiorari, not a
special civil action for certiorari was, therefore, the correct remedy.

xxxx
Settled is the rule that where appeal is available to the aggrieved party, the special civil action
for certiorari will not be entertained remedies of appeal and certiorari are mutually exclusive,
not alternative or successive. Hence, certiorari is not and cannot be a substitute for a lost
appeal, especially if one's own negligence or error in one's choice of remedy occasioned such
loss or lapse. One of the requisites of certiorari is that there be no available appeal or any plain,
speedy and adequate remedy. Where an appeal was available, as in this case, certiorari will
not prosper, even if the ground therefor is grave abuse of discretion. Petitioner's resort to this
Court by Petition for Certiorari was a fatal procedural error, and the instant petition must,
therefore, fail.[11]

For the very same reason given above, the CA, therefore, acted properly when it dismissed the petition
for certiorari outright, on the ground that petitioners should have resorted to the remedy of appeal instead
of certiorari. Verily, the present Petition for Certiorari should not have been given due course at all.

Moreover, since the period for petitioners to file a petition for review on certiorari had lapsed by the time the
instant petition was filed, the assailed CA Resolutions have attained finality.

Nevertheless, just to put the matter to rest, the Court reiterates the ruling in Heirs of Valeriano S. Concha, Sr. v.
Spouses Lumocso,[12] to wit:

In a number of cases, we have held that actions for reconveyance of or for cancellation of title to
or to quiet title over real property are actions that fall under the classification of cases that
involve title to, or possession of, real property, or any interest therein.
xxxx

x x x Thus, under the old law, there was no substantial effect on jurisdiction whether a
case is one, the subject matter of which was incapable of pecuniary estimation, under Section
19(1) of B.P. 129, or one involving title to property under Section 19(2). The distinction between
the two classes became crucial with the amendment introduced by R.A. No. 7691 in 1994, which
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 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 (P50,000.00) exclusive of interest, damages of whatever kind,
attorney's fees, litigation expenses and costs." Thus, under the present law, original
jurisdiction over cases the subject matter of which involves "title to, possession of, real
property or any interest therein" under Section 19(2) of B.P. 129 is divided between the
 first and second level courts, with the assessed value of the real property involved as the
benchmark. This amendment was introduced to "unclog the overloaded dockets of the RTCs
which would result in the speedier administration of justice."[13]

Clearly, the RTC and the CA ruled correctly that the MeTC had jurisdiction over private respondents' complaint
for Accion Reivindicatoria.

IN VIEW OF THE FOREGOING, the petition is DISMISSED for utter lack of merit. The Resolutions of the
Court of Appeals in CA-G.R. SP No. 78978, dated September 15, 2003 and June 1, 2004, are AFFIRMED.
SO ORDERED.

THIRD DIVISION

VICTORINO QUINAGORAN, G.R. NO. 155179

Petitioner,
Present:

YNARES-SANTIAGO, J.,
Chairperson,
- versus - AUSTRIA-MARTINEZ,
CHICO-NAZARIO,
NACHURA, and
REYES, JJ.

COURT OF APPEALS and

THE HEIRS OF JUAN DE LA
CRUZ, Promulgated:
Respondents. August 24, 2007
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x

DECISION

AUSTRIA-MARTINEZ, J.:

Before the Court is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, assailing the Decision[1] of
the Court Appeals (CA) in CA-GR SP No. 60443 dated May 27, 2002 and its Resolution[2] dated August 28, 2002, which
denied petitioner's Motion for Reconsideration.

The factual antecedents.

The heirs of Juan dela Cruz, represented by Senen dela Cruz (respondents), filed on October 27, 1994 a Complaint for
Recovery of Portion of Registered Land with Compensation and Damages
against Victorino Quinagoran (petitioner) before the Regional Trial Court (RTC) Branch XI of Tuao, Cagayan, docketed
as Civil Case No. 240-T.[3] They alleged that they are the co-owners of a a parcel of land containing 13,100 sq m located
at Centro, Piat, Cagayan, which they inherited from the late Juan dela Cruz;[4] that in the mid-70s, petitioner started
occupying a house on the north-west portion of the property, covering 400 sq m, by tolerance of respondents; that in 1993,
they asked petitioner to remove the house as they planned to construct a commercial building on the property; that
petitioner refused, claiming ownership over the lot; and that they suffered damages for their failure to use the
same.[5] Respondents prayed for the reconveyance and surrender of the disputed 400 sq m, more or less, and to be paid the
amount of P5,000.00 monthly until the property is vacated, attorney's fees in the amount of P20,000.00, costs of suit and
other reliefs and remedies just and equitable.[6]
Petitioner filed a Motion to Dismiss claiming that the RTC has no jurisdiction over the case under Republic Act
(R.A.) No. 7691, which expanded the exclusive original jurisdiction of the Municipal Trial Court (MTC) to include all
civil actions which involve title to, or possession of, real property, or any interest therein which does not
exceed P20,000.00. He argued that since the 346 sq m lot which he owns adjacent to the contested property has an
assessed value of P1,730.00, the assessed value of the lot under controversy would not be more than the said amount.[7]

The RTC denied petitioner's Motion to Dismiss in an Order dated November 11, 1999, thus:
The Court finds the said motion to be without merit. The present action on the basis of the allegation of the
complaint partakes of the nature of action publicciana (sic) and jurisdiction over said action lies with the
Regional Trial Court, regardless of the value of the property. This is so because in paragraph 8 of the
complaint, it is alleged that the plaintiff demanded from the defendant the removal of the house occupied by
the defendant and the possession of which is Only due to Tolerance (sic) of herein plaintiffs.

WHEREFORE, for lack of merit, the motion to dismiss is hereby denied.[8]

Petitioner's Motion for Reconsideration was also denied by the RTC.[9]

Petitioner then went to the CA on a Petition for Certiorari and Prohibition seeking the annulment of the Orders of the
RTC.[10]
On May 27, 2002, the CA rendered the herein assailed Decision dismissing petitioner's action and affirming in toto the
RTC.[11] Pertinent portions of said Decision, read:
At the onset, we find that the complaint filed by the Heirs of Juan dela Cruz, represented
by Senen dela Cruz adequately set forth the jurisdictional requirements for a case to be cognizable by the
Regional Trial Court. The Complaint is captioned recovery of portion of registered land and it contains
the following allegations:
7. That since plaintiffs and defendant were neighbors, the latter being the admitted owner of
the adjoining lot, the former's occupancy of said house by defendant was only due to the
tolerance of herein plaintiffs;

8. That plaintiffs, in the latter period of 1993, then demanded the removal of the subject house
for the purpose of constructing a commercial building and which herein defendant refused
and in fact now claims ownership of the portion in which said house stands;

9. That repeated demands relative to the removal of the subject house were hence made but
which landed on deaf ears;

10. That a survey of the property as owned by herein plaintiffs clearly establishes that the
subject house is occupying Four Hundred (400) square meters thereof at the north-west
portion thereof, as per the approved survey plan in the records of the Bureau of Lands.

xxxx

It is settled that when the complaint fails to aver facts constitutive of forcible entry or unlawful detainer,
as where it does not state how entry was effected or how and when dispossession started, the remedy
should either be an accion publiciana or an accion reinvindicatoria in the proper regional trial court. In
the latter instances, jurisdiction pertains to the Regional Trial Court.

As another legal recourse from a simple ejectment case governed by the Revised Rules of Summary
Procedure, an accion publiciana is the plenary action to recover the right of possession when
dispossession has lasted more than one year or when dispossession was effected by means other than
those mentioned in Rule 70 of the Rules of Court. Where there is no allegation that there was denial of
possession through any of the methods stated in Section 1, Rule 70 of the Rules of Court, or where there
is no lease contract between the parties, the proper remedy is the plenary action of recovery of
possession. Necessarily, the action falls within the jurisdiction of the Regional Trial Court. Thus, we find
 that the private respondents [heirs of dela Cruz] availed of the proper remedy when they filed the action
before the court a quo.

Undoubtedly, the respondent court therefore did not act with grave abuse of discretion amounting to or in
excess of jurisdiction in denying Quinagoran's Motion to Dismiss and the Motion for Reconsideration,
thereof, because it has jurisdiction to hear and decide the instant case.

xxxx

It would not be amiss to point out that the nature of the action and jurisdiction of courts are determined by
the allegations in the complaint. As correctly held by the Regional Trial Court, the present action on the
basis of the allegation of the complaint partakes of the nature of action publiciana and jurisdiction over
said action lies with the Regional Trial Court regardless of the value of the property. Therefore, we
completely agree with the court a quo's conclusion that the complaint filed by the Heirs of Juan dela Cruz,
represented by Senen dela Cruz, is in the nature of an accion publiciana and hence it is the Regional Trial
Court which has jurisdiction over the action, regardless of the assessed value of the property subject of
present controversy.[12]
Petitioner's Motion for Reconsideration was denied on August 28, 2002 for lack of merit.[13]

Petitioner now comes before this Court on a petition for review claiming that under R.A. No. 7691 the jurisdiction of the
MTC, Metropolitan Trial Court (MeTC), and Municipal Trial Court in Cities (MTCC) was expanded to include exclusive
original jurisdiction over civil actions when the assessed value of the property does not exceed P20,000.00 outside Metro
Manila and P50,000.00 within Metro Manila.[14] He likewise avers that it is an indispensable requirement that the
complaint should allege the assessed value of the property involved.[15] In this case, the complaint does not allege that the
assessed value of the land in question is more than P20,000.00. There was also no tax declaration attached to the
complaint to show the assessed value of the property. Respondents therefore failed to allege that the RTC has jurisdiction
over the instant case.[16] The tax declaration covering Lot No. 1807 owned by respondents and where the herein disputed
property is purportedly part -- a copy of which petitioner submitted to the CA -- also shows that the value of the property
is only P551.00.[17] Petitioner then prays that the CA Decision and Resolution be annulled and set aside and that the
complaint of herein respondents before the trial court be dismissed for lack of jurisdiction.[18]

Respondents contend that: the petition is without factual and legal bases, and the contested decision of the CA is entirely
in accordance with law;[19] nowhere in the body of their complaint before the RTC does it state that the assessed value of
the property is below P20,000.00;[20] the contention of petitioner in his Motion to Dismiss before the RTC that the
assessed value of the disputed lot is below P20,000.00 is based on the assessed value of an adjacent property and no
documentary proof was shown to support the said allegation;[21] the tax declaration which petitioner presented, together
with his Supplemental Reply before the CA, and on the basis of which he claims that the disputed property's assessed
value is only P551.00, should also not be given credence as the said tax declaration reflects the amount of P56,100.00 for
the entire property.[22]
The question posed in the present petition is not complicated, i.e., does the RTC have jurisdiction over all cases of
recovery of possession regardless of the value of the property involved?

The answer is no. The doctrine on which the RTC anchored its denial of petitioner's Motion to Dismiss, as affirmed by the
CA -- that all cases of recovery of possession or accion publiciana lies with the regional trial courts regardless of the
value of the property -- no longer holds true. As things now stand, a distinction must be made between those properties the
assessed value of which is below P20,000.00, if outside Metro Manila; and P50,000.00, if within.

Republic Act No. 7691[23] which amended Batas Pambansa Blg. 129[24] and which was already in effect[25] when
respondents filed their complaint with the RTC on October 27, 1994,[26] expressly provides:

SEC. 19. Jurisdiction in civil cases Regional Trial Courts shall exercise exclusive original
jurisdiction:
xxxx
(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 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.
xxxx
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 (P50,000.00) exclusive of interest, damages or
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.(Emphasis supplied)

The Court has also declared that all cases involving title to or possession of real property with an assessed value of less
than P20,000.00 if outside Metro Manila, falls under the original jurisdiction of the municipal trial court.[27]
In Atuel v. Valdez[28] the Court likewise expressly stated that:
Jurisdiction over an accion publiciana is vested in a court of general jurisdiction. Specifically, the regional
trial court exercises exclusive original jurisdiction in all civil actions which involve x x x possession of real
property. However, if the assessed value of the real property involved does not exceed P50,000.00 in
Metro Manila, and P20,000.00 outside of Metro Manila, the municipal trial court exercises
jurisdiction over actions to recover possession of real property.[29]

That settled, the next point of contention is whether the complaint must allege the assessed value of the property
involved. Petitioner maintains that there should be such an allegation, while respondents claim the opposite.

In no uncertain terms, the Court has already held that a complaint must allege the assessed value of the real property
subject of the complaint or the interest thereon to determine which court has jurisdiction over the action.[30] This is
because the nature of the action and which court has original and exclusive jurisdiction over the same is determined by the
material allegations of the complaint, the type of relief prayed for by the plaintiff and the law in effect when the action is
filed, irrespective of whether the plaintiffs are entitled to some or all of the claims asserted therein.[31]

In this case, the complaint denominated as Recovery of Portion of Registered Land with Compensation and
Damages, reads:
1. That plaintiffs are the only direct and legitimate heirs of the late Juan dela Cruz, who died intestate
on February 3, 1977, and are all residents of Centro, Piat, Cagayan;
xxxx
4. That plaintiffs inherited from x x x Juan dela Cruz x x x a certain parcel of land x x x containing an area
of 13,111 square meters.
5. That sometime in the mid-1960's, a house was erected on the north-west portion of the aforedescribed lot
x x x.
xxxx

7. That since plaintiffs and defendant were neighbors, the latter being the admitted owner of the adjoining
lot, the former's occupancy of said house by defendant was only due to the tolerance of herein plaintiffs;

8. That plaintiffs, in the latter period of 1993, then demanded the removal of the subject house for the
purpose of constructing a commercial building and which herein defendant refused and in fact now claims
ownership of the portion in which said house stands;

9. That repeated demands relative to the removal of the subject house were hence made but which landed on
deaf ears;
 10. That a survey of the property as owned by herein plaintiffs clearly establishes that the subject house is
occupying Four Hundred (400) square meters thereof at the north-west portion thereof, as per the approved
survey plan in the records of the Bureau of Lands.[32]

Nowhere in said complaint was the assessed value of the subject property ever mentioned. There is therefore no showing
on the face of the complaint that the RTC hasexclusive jurisdiction over the action of the respondents. [33] Indeed, absent
any allegation in the complaint of the assessed value of the property, it cannot be determined whether the RTC or the
MTC has original and exclusive jurisdiction over the petitioner's action.[34] The courts cannot take judicial notice of the
assessed or market value of the land.[35]

Jurisdiction of the court does not depend upon the answer of the defendant or even upon agreement, waiver or
acquiescence of the parties.[36] Indeed, the jurisdiction of the court over the nature of the action and the subject matter
thereof cannot be made to depend upon the defenses set up in the court or upon a motion to dismiss for,otherwise, the
question of jurisdiction would depend almost entirely on the defendant.[37]

Considering that the respondents failed to allege in their complaint the assessed value of the subject property, the
RTC seriously erred in denying the motion to dismiss. Consequently, all proceedings in the RTC are null and void,[38] and
the CA erred in affirming the RTC.[39]

WHEREFORE, the petition is GRANTED. The Court of Appeals's Decision in CA-GR SP No. 60443 dated May 27,
2002 and its Resolution dated August 28, 2002,are REVERSED and SET ASIDE. The Regional Trial Courts Orders
dated November 11, 1999 and May 11, 2000, and all proceedings therein are declared NULL and VOID. The complaint in
Civil Case No. 240-T is dismissed without prejudice.

No costs.

Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 176020 September 29, 2014

HEIRS OF TELESFORO JULAO, namely, ANITA VDA. DE ENRIQUEZ, SONIA J. TOLENTINO and RODERICK
JULAO, Petitioners,
vs.
SPOUSES ALEJANDRO and MORENITA DE JESUS, Respondents.

DECISION

DEL CASTILLO, J.:

Jurisdiction over the subject matter is conferred by law and is determined by the material allegations of the
complaint. Thus, it cannot be acquired through, or waived by, any act or omission of the parties; nor can it be cured by
1 2

their silence, acquiescence, or even express consent. 3

This Petition for Review on Certiorari under Rule 45 of the Rules of Court assails the Decision dated December 4, 2006
4 5

of the Court of Appeals (CA) in CA-G.R. CV No. 72845.

Factual Antecedents

Sometime in the 1960's, Telesforo Julao (Telesforo) filed before the Department of Environment and Natural Resources
6

(DENR), Baguio City, two Townsite Sales Applications (TSA), TSA No. V-2132 and TSA No. V-6667. Upon his death on
7

June 1, 1971, his applications were transferred to his heirs.

8
On April 30, 1979, Solito Julao (Solito) executed a Deed of Transfer of Rights, transferring his hereditary share in the
9 10

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. 11 12

On March 15, 1996, the DENR issued an Order: Rejection and Transfer of Sales Rights, to wit: 13

WHEREFORE, premises considered and it appearing that herein applicant is a holder of two (2) applications in violation
with established policy in the disposition [of] public lands in the City of Baguio, TSA V-6667 is hereby ordered dropped
from the records. Accordingly, it is henceforth ordered that TSA 2132 in the name ofTELESFORO JULAO be, as [it is]
hereby transferred to the heirs of TELESFORO JULAO, represented by ANITA VDA. DE ENRIQUEZ, and as thus
transferred, the same shall continue to be given due course. For convenience of easy reference, it is directed that the
[pertinent] records be consolidated in the name of the latter.

SO ORDERED. 14

Consequently, on December 21, 1998, Original Certificate of Title (OCT) No. P-2446, covering a 641-square meter 15

property, was issued in favor of the heirs of Telesforo. 16

On March 2, 1999, petitioners Anita Julao vda. De Enriquez, Sonia J. Tolentino and Roderick Julao, representing 17

themselves to be the heirs of Telesforo, filed before the Regional Trial Court (RTC), Baguio City, a Complaint or Recovery
of Possession of Real Property, docketed as Civil Case No. 4308-R, against respondent spouses. Petitioners alleged
18 19

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
20 21

encroached on 70 square meters of the subject property; that on August 4, 1998, petitioners sent a demand letter to
22

respondent spouses asking them to return the subject property; that respondent spouses refused to accede to the
23

demand, insisting that they acquired the subject property from petitioners' brother, Solito, by virtue of a Deed of Transfer
of Rights; that in the Deed of Transfer of Rights, Solito expressly transferred in favor of respondent spouses his
24

hereditary share in the parcel of land covered by TSA No. V-6667; that TSA No. V-6667 was rejected by the DENR; and
25 26

that respondent spouses have no valid claim over the subject property because it is covered by a separate application,
TSA No. V-2132. 27

Respondent spouses filed a Motion to Dismiss on the ground of prescription, which the RTC denied for lack of
28

merit. Thus, they filed an Answer contending that they are the true and lawful owners and possessors of the subject
29 30

property; that they acquired the said property from petitioners' brother, Solito; and that contrary to the claim of
31 32

petitioners, TSA No. V-6667 and TSA No. V-2132 pertain to the same property. 33

During the trial, petitioners disputed the validity of the Deed of Transfer of Rights executed by Solito. They presented
evidence to show that Telesforo submitted two applications, TSA No. V-2132 and TSA No. V-6667. The first one, TSA 34

No. V-2132, resulted in the issuance of OCT No. P-2446 in favor of the heirs ofTelesforo, while the second one, TSA No.
V-6667, was dropped from the records. They also presented evidence to prove that Solito had no hereditary share in the
35

estate of Telesforo because Solito was not Telesforo's biological son, but his stepson, and that Solito 's real name was
Francisco Bognot. 36

After petitioners rested their case, respondent spouses filed a Motion for Leave of Court to File a Demurrer to
Evidence. The RTC, however, denied the Motion.
37 38

The heirs of Solito then moved to intervene and filed an Answer-lnlntervention, arguing that their father, Solito, is a
39

legitimate son ofTelesforo and that Solito sold his hereditary share in the estate of his father to respondent spouses by
virtue of a Deed of Transfer of Rights. 40

To refute the evidence presented by petitioners, respondent spouses presented two letters from the DENR: ( 1) a letter
dated April 27, 1999 issued by Amando I. Francisco, the Officer-In-Charge of CENRO-Baguio City, stating that "it can be
concluded that TSA No. V-2132 and TSA No. V-6667 referred to one and the same application covering one and the
same lot;" and (2) a letter dated September 30, 1998 from the DENR stating that "the land applied for with assigned
41 42

number TSA No. V-2132 was renumbered as TSA No. V-6667 as per 2nd Indorsement dated November 20, 1957 x x
x." They also presented two affidavits, both dated August 31, 1994, executed by petitioners Sonia Tolentino and
43 44

Roderick Julao, acknowledging that Solito was their co-heir and that he was the eldest son of Telesforo. Ruling of the
45 46

Regional Trial Court

On August 10, 2001, the RTC rendered a Decision in favor of petitioners. The RTC found that although petitioners failed
47
1âwphi 1

to prove their allegation that Solito was not an heir of Telesforo, they were nevertheless able to convincingly show that
48

Telesforo filed with the DENR two applications, covering two separate parcels of land, and that it was his first application,
TSA No. V-2132, which resulted in the issuance of OCT No. P-2446. And since what Solito transferred to respondent
49

spouses was his hereditary share in the parcel of land covered by TSA No. V-6667, respondent spouses acquired no right
over the subject property, which was derived from a separate application, TSA No. V-2132. Thus, the RTC disposed of
50

the case in this wise:

WHEREFORE, premises considered, judgment is hereby rendered in favor of the [petitioners] and against the
[respondents] who are hereby ordered to restore the possession of the land in question consisting of an area of 70 square
meters, more or less, which is a portion of the land covered by [OCT] No. P-2446. The [respondents] are ordered to
remove the house and/or other improvements that they constructed over the said parcel of land and to vacate the same
upon the finality of this decision.

SO ORDERED. 51

Ruling of the Court of Appeals

Aggrieved, respondent spouses elevated the case to the CA.

On December 4, 2006, the CA reversed the ruling of the RTC. The CA found the Complaint dismissible on two grounds:
(1) failure on the part of petitioners to identify the property sought to be recovered; and (2) lack of jurisdiction. The CA
noted that petitioners failed to pinpoint the property sought to be recovered. In fact, they did not present any survey plan
52

to show that respondent spouses actually encroached on petitioners' property. Moreover, the CA was not fully convinced
53

that the two applications pertain to two separate parcels of land since respondent spouses were able to present evidence
to refute such allegation. The CA likewise pointed out that the Complaint failed to establish that the RTC had jurisdiction
54

over the case as petitioners failed to allege the assessed value of the subject property. Thus: 55

WHEREFORE, premises considered, the appeal is GRANTED. The decision appealed from is REVERSED and SET
ASIDE. The complaint is DISMISSED.

SO ORDERED. 56

Issues

Hence, petitioners filed the instant Petition for Review on Certiorari, raising the following errors:

THE [CA] COMMITTED REVERSIBLE ERROR IN RULING THAT PETITIONERS FAILED TO PROVE THE IDENTITY
OF THE PROPERTY IN QUESTION.

II

THE [CA] COMMITTED REVERSIBLE ERROR IN RULING THAT THE TRIAL COURT DID NOT ACQUIRE
JURISDICTION OVER THE COMPLAINT. 57

At this juncture, it must be mentioned that in the Resolution dated March 19, 2007, we required respondent spouses to
58

file their Comment to the Petition which they failed to comply with. Thus, in the Resolution dated March 11, 2013, we
59

dispensed with the filing of respondent spouses' Comment. At the same time, we required petitioners to manifest whether
they are willing to submit the case for resolution based on the pleadings filed. To date, petitioners have not done so.

Our Ruling

The Petition lacks merit.

The assessed value must be alleged in the complaint to determine which court has jurisdiction over the action.
Jurisdiction as we have said is conferred by law and is detennined by the allegations in the complaint, which contains the
concise statement of the ultimate facts of a plaintiffs cause of action. 60

Section 19(2) and Section 33(3) of Batas Pambansa Big. 129, as amended by Republic Act No. 7691, provide:

SEC. 19. Jurisdiction in Civil Cases. - Regional Trial Courts shall exercise exclusive original jurisdiction:

xxxx

(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 (₱20,000.00) or for civil actions in Metro Manila, where
such value exceeds Fifty thousand pesos (₱50,000.00) 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:

xxxx

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:

x x x x (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
(₱20,000.00) or, in civil actions in Metro Manila, where such assessed value does not exceed Fifty Thousand Pesos
(₱50,000.00) 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.

Based on the foregoing, it is clear that in an action for recovery of possession, the assessed value of the property sought
to be recovered determines the court's jurisdiction. 61

In this case, for the RTC to exercise jurisdiction, the assessed value of the subject property must exceed ₱20,000.00.
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.

Furthermore, contrary to the claim of petitioners, the issue of lack of jurisdiction was raised by respondents in their
Appellant's Brief And the fact that it was raised for the first time on appeal is of no moment. Under Section 1, Rule 9 of
62 63

the Revised Rules of Court, defenses not pleaded either in a motion to dismiss or in the answer are deemed waived,
except for lack of jurisdiction, litis pendentia, res judicata, and prescription, which must be apparent from the pleadings or
the evidence on record. In other words, the defense of lack of jurisdiction over the subject matter may be raised at any
stage of the proceedings, even for the first time on appeal. In fact, the court may motu proprio dismiss a complaint at any
64

time when it appears from the pleadings or the evidence on record that lack of jurisdiction exists. 65

In an action to recover, the property must be identified

Moreover, Article 434 of the Civil Code states that "[i]n 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. It bears stressing that the failure of the plaintiff to establish the identity of the property claimed is fatal to his
66

case.67

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
68

prove their allegation, petitioners are not entitled to the relief prayed for in their Complaint.

All told, we find no error on the part of the CA in dismissing the Complaint for lack of jurisdiction and for failing to identify
the property sought to be recovered.
WHEREFORE, the Petition is hereby DENIED. The Decision dated December 4, 2006 of the Court of Appeals in CA-G.R.
CV No. 72845 is hereby AFFIRMED.

SO ORDERED.

THIRD DIVISION
HEIRS OF MAURA SO, namely, YAN LAM LIM, G.R. No. 147082
JIMMY SO LIM, and FERDINAND SO LIM,
Petitioners,
Present:
- versus -
YNARES-SANTIAGO, J.,
LUCILA JOMOC OBLIOSCA, ELVIRA JOMOC Chairperson,
GARDINAB, and HEIRS OF ABUNDIA JOMOC AUSTRIA-MARTINEZ,
BALALA, namely, ROSITA BALALA ACENAS, CORONA,*
EVANGELINE BALALA BAACLO, OLIVER NACHURA, and
JOMOC BALALA, and PERLA BALALA REYES, JJ.
CONDESA,
Respondents. Promulgated:

January 28, 2008

x------------------------------------------------------------------------------------x

DECISION

NACHURA, J.:

This is a petition for review on certiorari of the Decision[1] of the Court of Appeals (CA) dated October 18, 2000,
and Resolution dated January 11, 2001, denying the motion for reconsideration of the said decision. The assailed decision
declared that a petition for annulment of judgment cannot be availed of when the petitioner had already filed an appeal
under Rule 45 of the Rules of Court.

The antecedents of the case are as follows:

Pantaleon Jomoc was the owner of a parcel of land with an area of 496 square meters, covered by Transfer
Certificate of Title (TCT) No. T-19648, and located at Cogon District, Cagayan de Oro. Upon his death, the property was
inherited by his wife, brothers, sisters, nephews and nieces (collectively referred to as the Jomoc heirs). The respondents,
Lucila Jomoc Obliosca and Abundia Jomoc Balala, sisters of the deceased, and Elvira Jomoc, a niece, were among those
who inherited the property.

In February 1979, the Jomoc heirs executed a Deed of Extrajudicial Settlement with Absolute Sale of Registered
Land[2] in favor of petitioner, Maura So, over the property for P300,000.00. However, the three respondents and Maura So
failed to affix their signatures on this document. Moreover, the document was not notarized. Nonetheless, petitioner made
a partial payment of P49,000.00 thereon.

Thereafter, petitioner demanded the execution of a final deed of conveyance but the Jomoc heirs ignored the
demand. On February 24, 1983, petitioner filed a Complaint[3] for specific performance against the Jomoc heirs to compel
them to execute and deliver the proper registerable deed of sale over the lot. The Jomoc heirs, except for the respondents,
were impleaded as defendants. The case was docketed as Civil Case No. 8983.

On February 28, 1983, the Jomoc heirs executed again a Deed of Extrajudicial Settlement with Absolute Sale of
Registered Land[4] in favor of the spouses Lim Liong Kang and Lim Pue King for P200,000.00. The spouses Lim
intervened as defendants in Civil Case No. 8983.
 On February 12, 1988, the trial court decided the case in favor of the petitioner. On appeal, the CA affirmed the
decision with the modification that the award of damages, attorneys fees and expenses of litigation was deleted. The
defendant heirs and the spouses Lim filed separate petitions for review with the Supreme Court, docketed as G.R. Nos.
92871 and 92860, which petitions were later consolidated.

On August 2, 1991, the Court rendered a Decision[5] in these consolidated cases upholding petitioners better right
over the property.[6] The decision became final and executory on November 25, 1991.

On February 10, 1992, petitioner filed a motion for execution of the said decision. The respondents opposed the
motion on the ground that they did not participate in the execution of the Deed of Extrajudicial Settlement with Absolute
Sale of Registered Land and they were not parties to the case. Despite the opposition, the trial court granted the motion for
execution. The respondents filed a motion for reconsideration but the trial court denied the same.

On July 22, 1992, the trial court issued an Order granting the motion for execution and divesting all the Jomoc
heirs of their titles over the property.[7]Accordingly, the Register of Deeds cancelled the title of the Jomoc heirs and issued
TCT No. T-68370 in the name of the petitioner on July 24, 1992.

All the Jomoc heirs filed a petition for certiorari with the CA, assailing the said order of the RTC. They alleged
that herein respondents were not parties to the case, therefore, they should not be bound by the decision therein and be
deprived of their right over the property. On December 8, 1992, the CA dismissed the petition, holding that respondents
were bound by the said decision. The CA ratiocinated that respondents were aware of the pendency of the case, yet they
did not intervene, and that the case is barred by res judicata. Respondents elevated the case to this Court through a
petition for review on certiorari, which was docketed as G.R. No. 110661. In a Resolution dated December 1, 1993, the
Court denied the petition, thus:

In the case of Vda. de Jomoc v. Court of Appeals (200 SCRA [1991]), this Court concluded that
the contract of sale between the heirs of Pantaleon Jomoc and the private respondent Maura So, even if
not complete in form, so long as the essential requisites of consent of the contracting parties, object and
cause of the obligation concur, and they were clearly established to be present, is valid and effective
between the parties.

The lower court found that petitioners were aware of the pendency of the specific performance
case brought by Maura So and we agree with the Court of Appeals that their failure to intervene in said
suit for the protection of their rights binds them to the decision rendered therein.

This Court has held that a writ of execution may be issued against a person not a party to a case
where the latters remedy, which he did not avail of, was to intervene in the case in question involving
rights over the same parcel of land (Lising vs. Plan, 133 SCRA 194 [1984]; Suson vs. Court of Appeals,
172 SCRA 70 [1989])

It appears that petitioner Elvira Jomoc Gadrinab signed a Special Power of Attorney in favor of
Fellermo Jomoc to represent her in all proceedings regarding Civil Case No. 8983. It also appears that all
the Jomoc heirs wanted to realize a higher price by selling the same piece of land a second time to the
Lim spouses. Petitioner Lucila, Abundia and Elvira shared the same goal, and kept quiet while Maura So
sought relief before the trial court. The other heirs sought to capitalize on Lucilas, Abundias and Elviras
non-participation in the first sale to Maura So. The heirs (all of them) position is bereft of moral and
equitable basis.

As for the issue of res judicata, we believe that the same applies as a bar to the instant Petition. In
G.R. No. 92871 and G.R. No. 92860, this Court had occasion to rule that herein private respondent had
the right to compel the heirs of Pantaleon Jomoc to execute the proper public instrument so that a valid
contract of sale of registered land can be duly registered and can bind third persons. In effect, this Court
had already determined the right of private respondent to a proper registerable deed of sale which
petitioners seek to challenge again in this Petition. A party cannot avoid the application of the principle of
bar by prior judgment by simply varying the form of the action or by adopting a different mode of
 presenting its case or by adding or dropping a party (Widows and Orphans Association, Inc. vs. Court of
Appeals, 212 SCRA 360 [1992]).

ACCORDINGLY, the Court Resolved to DENY the Petition for Review for lack of merit.

The resolution became final and executory on June 20, 1994.

It appears that, on March 12, 1992, respondents also filed a complaint for legal redemption against petitioner with
the Regional Trial Court (RTC) of Misamis Oriental. The case was docketed as Civil Case No. 92-135. Respondents
posited therein that, since they did not sell their shares in the property to petitioner, they remained co-owners, who have
the right to redeem the shares sold by the other heirs. They prayed that they be allowed to exercise their right to redeem
their co-heirs shares and that petitioner execute all papers, documents and deeds to effectuate the right of legal
redemption.

On April 27, 1994, the RTC resolved the case in favor of the respondents, thus:

WHEREFORE, judgment is hereby rendered on the pleadings and evidence of the parties on
record, affidavits and other documents submitted, there being but purely legal issues involve[d], ordering
the defendant herein, MAURA SO, to allow the plaintiffs to exercise their substantive right of legal
redemption of the shares of plaintiffs co- heirs, defendant Maura So, for the purpose of redemption by
the plaintiffs, Lucita Jomoc Obliosca, Abundia Jomoc Balala (deceased) substituted by her children:
Rosita Balala Acenas, Evangeline Balala Baaclo, Oliver J. Balala, and Perla Balala Condesa; and Elvira
Jomoc Gardinab, is ordered to receive and accept the amount tendered by the plaintiffs in the amount
of P49,000.00 deposited in the Office of the Clerk of Court of the Regional Trial Court of Misamis
Oriental at Cagayan de Oro City, and to execute a deed of redemption in favor of the herein plaintiffs
reconveying to the latter the property, and to pay Plaintiffs for attorneys fees in the reasonable sum
of P20,000.00.

Other claims and for counterclaims for monetary damages of the parties are dismissed, with costs
against defendant.

SO ORDERED.[8]

In a Resolution dated July 14, 1994, the RTC granted petitioners motion for reconsideration.[9] Respondents moved for
reconsideration of the said resolution. On September 7, 1994, the RTC issued an Order[10] granting respondents motion for
reconsideration and reinstating the April 27, 1994 Resolution.

On November 14, 1994, acting jointly on petitioners Motion for Reconsideration and respondents
Compliance/Motion for the Issuance of a Writ of Execution, the RTC rendered a Resolution, [11] denying petitioners
motion for reconsideration and granting respondents motion for execution.

On December 28, 1994, petitioner, later substituted by her heirs, filed with the CA a petition for annulment of
judgment, particularly the September 7, 1994 Order, which reinstated the RTCs April 27, 1994 and November 14, 1994
Resolutions, which denied the petitioners motion for reconsideration. On October 18, 2000, the CA denied the petition,
holding that the remedy of a petition for annulment of judgment is no longer available since petitioner Maura So had
already filed a petition for review with this Court assailing the same orders of the trial court.[12]

Apparently, on December 19, 1994, prior to the filing of the petition for annulment of judgment with the CA,
petitioner Maura So filed a petition for review on certiorari[13] with this Court assailing the same RTC Order and
Resolution. This case was docketed as G.R. No. 118050. In a Minute Resolution dated March 1, 1995, the Court denied
the petition for failure to sufficiently show that the questioned judgment is tainted with grave abuse of discretion and for
being the wrong remedy.[14] On June 7, 1995, the Court likewise denied petitioners first motion for reconsideration,[15] and
on July 27, 1998, the second motion for reconsideration. The March 1, 1995 Minute Resolution became final and
executory on September 1, 1998.[16]
 On January 11, 2001, the CA denied petitioners motion for reconsideration of its decision denying the petition for
annulment of judgment.[17] Petitioners then filed this petition for review, raising the following issues:

I.
WHETHER OR NOT THE HONORABLE COURT OF APPEALS COMMITTED A REVERSIBLE
ERROR IN NOT HOLDING THAT THE TRIAL COURT ACTED WITHOUT JURISDICTION IN
CIVIL CASE NO. 92-135 BECAUSE THE HONORABLE SUPREME COURT HAD PREVIOUSLY
RULED THAT THE LOT IN QUESTION HAD BEEN SOLD TWICE BY ALL THE HEIRS OF
PANTALEON TO MAURA SO AND LATER TO THE LIM SPOUSES IN G.R. NOS. 92871 AND
98860 AND G.R. NO. 110661 AND SAID FINAL DECISIONS AND RESOLUTION CANNOT BE
REVISED AND REVERSED BY SAID TRIAL COURT.

II.

WHETHER OR NOT THE HONORABLE COURT OF APPEALS COMMITTED A REVERSIBLE

ERROR IN HOLDING THAT THE ORIGINAL PETITION DOCKETED AS CA-G.R. SP NO. 50059
IS BARRED BY RES JUDICATA BECAUSE THE RESOLUTION IN G.R. NO. 118050 DID NOT
AND CANNOT REPEAL THE FINAL AND EXECUT[ORY] DECISIONS IN G.R. NO. 92871 AND
G.R. NO. 92860, AND THE FINAL AND EXECUT[ORY] RESOLUTION IN G.R. NO. 110661, AS
THE RESOLUTION IN G.R. NO. 118050 IS NOT ON THE MERITS, OR BY THE SUPREME
COURT EN BANC.[18]

The Court resolves to grant the petition despite the prevailing procedural restrictions, considering the peculiar
circumstances of the case, in order to avoid causing a grave injustice to petitioners.

But before we discuss these circumstances which impel us to grant the petition, we must acknowledge extant
procedural principles.

First, annulment of judgment is a recourse equitable in character, allowed only in exceptional cases as where there
is no available or other adequate remedy.[19]Thus, it may not be invoked (1) where the party has availed himself of the
remedy of new trial, appeal, petition for relief, or other appropriate remedy and lost; or (2) where he has failed to avail
himself of those remedies through his own fault or negligence. [20] We, therefore, agree with the CA that the remedy of a
petition for annulment of judgment is no longer available to petitioners since their predecessor-in-interest, Maura So, had
already availed herself of a petition for review on certiorari under Rule 45 of the Rules of Court.

Further, none of the grounds for annulment of judgment, namely, extrinsic fraud and lack of jurisdiction, is
present in this case.

Petitioners argue that the RTC acted without jurisdiction when it rendered the Resolution which recognized
respondents right to redeem the property because this, in effect, amended the Decision of the Supreme Court in G.R. Nos.
92871 and 92860, and the Resolution in G.R. No. 110661, which sustained the sale of the property to Maura So.

Petitioners clearly confused lack of jurisdiction with error in the exercise of jurisdiction. Jurisdiction is not the
same as the exercise of jurisdiction. As distinguished from the exercise of jurisdiction, jurisdiction is the authority to
decide a case, and not the decision rendered therein. Where there is jurisdiction over the person and the subject matter, the
decision on all other questions arising in the case is but an exercise of such jurisdiction. And the errors which the court
may commit in the exercise of jurisdiction are merely errors of judgment which are the proper subject of an appeal.[21] The
error raised by petitioners pertains to the trial courts exercise of its jurisdiction, not its lack of authority to decide the
case. In a petition for annulment of judgment based on lack of jurisdiction, petitioner must show not merely an abuse of
jurisdictional discretion but an absolute lack of authority to hear and decide the case. On this basis, there would be no
valid ground to grant the petition for annulment of judgment.

Second, well-settled is the principle that a decision that has acquired finality becomes immutable and unalterable,
and may no longer be modified in any respect even if the modification is meant to correct erroneous conclusions of fact or
law and whether it will be made by the court that rendered it or by the highest court of the land.[22] The reason for this is
that litigation must end and terminate sometime and somewhere, and it is essential to an effective and efficient
administration of justice that, once a judgment has become final, the winning party, through a mere subterfuge, be not
deprived of the fruits of the verdict.[23]

The doctrine of finality of judgment is grounded on the fundamental principle of public policy and sound practice
that, at the risk of occasional error, the judgment of courts and the award of quasi-judicial agencies must become final on
some definite date fixed by law.[24] The only exceptions to the general rule are the correction of clerical errors, the so-
called nunc pro tunc entries which cause no prejudice to any party, void judgments, and whenever circumstances
transpire after the finality of the decision which render its execution unjust and inequitable. [25] Again, none of these
exceptions is present in this case.

Notwithstanding these principles, however, the higher interests of justice and equity demand that we brush aside
the procedural norms. After all, rules of procedure are intended to promote rather than defeat substantial justice, and
should not be applied in a very rigid and technical sense. Rules of procedure are merely tools designed to facilitate the
attainment of justice; they are promulgated to aid the court in the effective dispensation of justice. The Court has the
inherent power and discretion to amend, modify or reconsider a final judgment when it is necessary to accomplish the
ends of justice.[26]

If the rigid application of the Rules would frustrate rather than promote justice, it is always within the Courts
power to suspend the Rules or except a particular case from its operation.[27] The power to suspend or even disregard rules
can be so pervasive and compelling as to alter even that which this Court itself has already declared to be final. [28]

The present case is peculiar in the sense that it involves three final and executory judgments. The first is this
Courts Decision in G.R. Nos. 92871 and 92860 which upheld the sale of the whole property by the Jomoc heirs, including
the herein respondents, to petitioner Maura So. The second is the Courts Resolution in G.R. No. 110661, which sustained
the order of execution of the said decision against the herein respondents despite the fact that they were not party-
defendants in the first case. And the third is the Courts Minute Resolution in G.R. No. 118050 which denied Maura Sos
petition for review of the RTC Decision granting respondents right to redeem the property.

It is the third judgment that is apparently in conflict with the two previous judgments. It rendered final and
executory the April 27, 1994 Resolution of the RTC which recognized the right of respondents, as co-owners, to redeem
the disputed land from Maura So. To recall, the RTC premised its decision on its finding that respondents did not actually
sell their shares in the property to Maura So because they did not sign the Deed of Extrajudicial Settlement with Absolute
Sale of Registered Land in favor of So; hence, they remained co-owners. This ruling is patently erroneous because this
Court had already pronounced in the first two final and executory judgments (in G.R. Nos. 92871 and 92860, and G.R.
No. 110661) that the whole property had already been sold to Maura So. The RTC was barred from holding otherwise
under the doctrine of conclusiveness of judgment.

The doctrine of conclusiveness of judgment precludes the re-litigation of a particular fact or issue already passed
upon by a court of competent jurisdiction in a former judgment, in another action between the same parties based on a
different claim or cause of action.[29]

In Collantes v. Court of Appeals,[30] the Court offered three options to solve a case of conflicting decisions:
the first is for the parties to assert their claims anew, the second is to determine which judgment came first, and the third is
to determine which of the judgments had been rendered by a court of last resort. In that case, the Court applied the first
option and resolved the conflicting issues anew.

Instead of resorting to the first offered solution as in Collantes, which would entail disregarding all the three final
and executory decisions, we find it more equitable to apply the criteria mentioned in the second and third solutions, and
thus, maintain the finality of one of the conflicting judgments. The principal criterion under the second option is the time
when the decision was rendered and became final and executory, such that earlier decisions should be sustained over the
current ones since final and executory decisions vest rights in the winning party. The major criterion under the third
solution is a determination of which court or tribunal rendered the decision. Decisions of this Court should be accorded
more respect than those made by the lower courts.
 The application of these criteria points to the preservation of the Decision of this Court in G.R. Nos. 92871 and
92860 dated August 2, 1991, and its Resolution in G.R. No. 110661 dated December 1, 1993. Both judgments were
rendered long before the Minute Resolution in G.R. No. 118050 was issued on March 1, 1995. In fact, the August 2, 1991
Decision was executed already respondents were divested of their title over the property and a new title, TCT No. T-
68370, was issued in the name of Maura So on July 24, 1992. Further, while all three judgments actually reached this
Court, only the two previous judgments extensively discussed the respective cases on the merits. The third judgment (in
G.R. No. 118050) was a Minute Resolution, dismissing the petition for review on certiorari of the RTC Resolution in the
legal redemption case for failure to sufficiently show that the questioned resolution was tainted with grave abuse of
discretion and for being the wrong remedy. In a manner of speaking, therefore, the third final and executory judgment was
substantially a decision of the trial court.

Obviously, the complaint for legal redemption was deliberately filed by the respondents with the RTC to
circumvent this Courts previous decisions sustaining the sale of the whole property to Maura So. The Court cannot
condone this ploy, even if it failed to uncover the same when the case was erroneously elevated to it directly from the trial
court (G.R. No. 118050).

The matter is again before this Court, and this time, it behooves the Court to set things right in order to prevent a
grave injustice from being committed against Maura So who had, for 15 years since the first decision was executed,
already considered herself to be the owner of the property. The Court is not precluded from rectifying errors of judgment
if blind and stubborn adherence to the doctrine of immutability of final judgments would involve the sacrifice of justice
for technicality.

WHEREFORE, premises considered, the petition is GRANTED. The Decision of the Court of Appeals
dated October 18, 2000, and Resolution dated January 11, 2001, are REVERSED. The April 27, 1994 Resolution and
September 7, 1994 Order of the RTC are SET ASIDE. The complaint for legal redemption docketed as Civil Case No.
92-135 is DISMISSED.

SO ORDERED.

TERESITA BONGATO, petitioner, vs. Spouses SEVERO A. MALVAR and TRINIDAD

MALVAR, respondents.

DECISION
PANGANIBAN, J.:

An action for forcible entry is a quieting process that is summary in nature. It is designed to recover physical
possession in speedy proceedings that are restrictive in nature, scope and time limits. The one-year bar within which to
bring the suit is prescribed to complement its summary nature. Thus, after the one-year period has lapsed, plaintiffs can
no longer avail themselves of the summary proceedings in the municipal trial court but must litigate, in the normal course,
in the regional trial court in an ordinary action to recover possession, or to recover both ownership and possession.

Statement of the Case

Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, assailing the December 16, 1998
Decision and the September 1, 1999 Resolution of the Court of Appeals (CA) in CA-GR SP No. 34204. The decretal
[1] [2]

portion of the Decision reads:

WHEREFORE, the petition is hereby dismissed for lack of merit. Costs against petitioner. [3]

The assailed Resolution denied petitioners Motion for Reconsideration.

The CA sustained the Decision of the Regional Trial Court (RTC) of Butuan City (Branch 4), which had disposed
thus:
WHEREFORE, in view of all the foregoing, the Court hereby affirms the decision of the Municipal Trial Court in Cities,
Branch 2 penned by the Honorable Santos Rod. Cedro and the Writ of Execution issued on the 24th day of August 1993
upon order of the Honorable Rosarito F. Dabalos (Record, p. 42, Folio II) can now be served on the defendant. [4]

The Facts

The factual antecedents of the case are summarized by the Court of Appeals as follows:

The spouses Severo and Trinidad Malvar filed a complaint for forcible entry against petitioner Teresita Bongato, alleging
that petitioner Bongato unlawfully entered a parcel of land covered by TCT No. RT-16200 belonging to the said spouses
and erected thereon a house of light materials. The petitioner filed a motion for extension of time to file an answer which
the MTCC denied; it being proscribed under the Rule on Summary Procedure, and likewise containing no notice of
hearing. With a new counsel, Atty. Viador C. Viajar, petitioner filed an answer which the MTCC disregarded, the same
having been filed beyond the ten-day reglementary period. Later, with still another counsel, Atty. Jesus G. Chavez of the
Public Attorneys Office, petitioner filed a motion to dismiss which the MTCC denied as being contrary to the Rule on
Summary Procedure.

Thereafter, the MTCC rendered a decision ordering petitioner to vacate the land in question, and to pay rentals, attorneys
fees, and the costs of the suit. The decision was affirmed by respondent RTC judge. Petitioner filed a motion for
reconsideration.

On March 4, 1994, respondent Judge issued an order granting the motion for reconsideration only insofar as to determine
the location of the houses involved in this civil case so that the Court will know whether they are located on one and the
same lot or a lot different from that involved in the criminal case for Anti-Squatting. In the same order, respondent Judge
disallowed any extension and warned that if the survey is not made, the court might consider the same abandoned and the
writ of execution would be issued.

The criminal case for anti-squatting (Crim. Case No. 4659) was filed by private respondents Malvar against petitioner
Bongato. The case is still pending with the Regional Trial Court, Branch I, Butuan City.

On March 28, 1994, petitioner filed a motion for extension of the March 29, 1994 deadline for the submission of the
relocation survey and to move the deadline to April 15, 1994, as the engineer concerned, Engr. Lumarda, could not
conduct his survey during the Holy Week, he being a lay minister and parish council member.

On April 7, 1994, respondent Judge noted that no survey report was submitted and ordered the record of the case returned
to the court of origin for disposal. (Citations omitted)
[5]

Ruling of the Court of Appeals

The CA held that the lot referred to in the present controversy was different from that involved in the anti-squatting
case. It further ruled that the Municipal Trial Court in Cities (MTCC) had jurisdiction, and that it did not err in rejecting
[6]

petitioners Motion to Dismiss. The appellate court reasoned that the MTCC had passed upon the issue of ownership of
the property merely to determine possession -- an action that did not oust the latter of its jurisdiction.
[7]

Unsatisfied with the CA Decision, petitioner lodged this Petition. [8]

Issues

In her Memorandum, petitioner raises the following issues for this Courts consideration:
I
Whether or not the Court of Appeals gravely abused its discretion in not finding that the trial court lacked jurisdiction
since the Complaint was filed beyond the one-year period from date of alleged entry;

II

Whether or not the Court of Appeals gravely abused its discretion in ruling that the Motion to Dismiss was a prohibited
pleading.[9]

This Courts Ruling

The Petition is meritorious.

First Issue:
MTCC Jurisdiction

Petitioner claims that the MTCC had no jurisdiction, because the Complaint for forcible entry was filed only in 1992 or
beyond the one-year period provided under the Rules of Civil Procedure. She avers that in Criminal Case No. 4659 for
[10]

anti-squatting, Respondent Severo Malvar alleged in his Sworn Statement that petitioner had illegally entered his land
sometime in the first week of January 1987. [11]

On the other hand, respondents contend that the subject of the anti-squatting case is different from the parcel of land
involved here. [12]

Before tackling the issue directly, it is worthwhile to restate three basic legal principles. First, in forcible entry, one
employs force, intimidation, threat, strategy or stealth to deprive another of physical possession of land or building. Thus, [13]

the plaintiff must allege and prove prior physical possession of the property in litigation until deprived thereof
by the defendant. This requirement implies that the possession of the disputed land by the latter was unlawful from the
[14]

beginning. The sole question for resolution hinges on the physical or material possession (possession de facto) of the
[15]

property. Neither a claim of juridical possession (possession de jure) nor an averment of ownership by the defendant [16]

can outrightly prevent the court from taking cognizance of the case. Ejectment cases proceed independently of any
[17]

claim of ownership, and the plaintiff needs merely to prove prior possession de facto and undue deprivation thereof. [18]

Second, as a general rule, courts do not take judicial notice of the evidence presented in other proceedings, even if
these have been tried or are pending in the same court or before the same judge. There are exceptions to this
[19]

rule. Ordinarily, an appellate court cannot refer to the record in another case to ascertain a fact not shown in the record of
the case before it, yet, it has been held that it may consult decisions in other proceedings, in order to look for the law that
[20]

is determinative of or applicable to the case under review. In some instances, courts have also taken judicial notice of
[21]

proceedings in other cases that are closely connected to the matter in controversy. These cases may be so closely
[22]

interwoven, or so clearly interdependent, as to invoke a rule of judicial notice. [23]

Third, factual findings of trial courts, especially when affirmed by the Court of Appeals, are binding on the Supreme
Court. Indeed, the review of such findings is not a function that this Court normally undertakes. However, this Rule is not
[24]

absolute; it admits of exceptions, such as (1) when the findings are grounded entirely on speculation, surmises or
conjectures; (2) when a lower courts inference from its factual findings is manifestly mistaken, absurd or impossible; (3)
when there is grave abuse of discretion in the appreciation of facts; (4) when the findings of the appellate court go beyond
the issues of the case, run contrary to the admissions of the parties to the case, or fail to notice certain relevant facts
which -- if properly considered -- will justify a different conclusion; (5) when there is a misappreciation of facts; (6) when
the findings of fact are conclusions without mention of the specific evidence on which they are based, are premised on the
absence of evidence, or are contradicted by evidence on record. [25]

Respondents in the present Petition filed three cases against petitioner: (1) Criminal Case No. 4659 for violation of
PD No. 772 (filed on October 2, 1991), in which petitioner was acquitted on the ground of good faith; (2) Civil Case No.
[26]

5681 for forcible entry (filed on July 10, 1992) which was resolved by the MTCC on October 26, 1992. (3) Criminal Case [27]

No. 5734 for Violation of PD No. 1096 (filed on July 15, 1993), wherein petitioner was again acquitted.
[28]

We agree with respondents that Lot 10-A, covered by Transfer Certificate of Title (TCT) No. RT-16200 and [29]

registered under the name of Severo Malvar, is different from Lot 1 which is covered by TCT No. RT-15993 and [30]

registered under the name of Severo Malvar also. However, we cannot ignore the Decision dated April 30, 1996 in [31]

Criminal Case No. 4659 for violation of PD 772; or the Decision dated November 26, 1997 in Criminal Case No. 5734 for
[32]
violation of PD 1096. The property involved in these two criminal cases and in the instant case for forcible entry is one and
the same -- petitioners house.
The allegation of petitioner that there is only one house involved in these three cases has not been controverted by
respondents. Neither was there evidence presented to prove that, indeed, she had constructed one house on Lot
1 and another on Lot 10-A. On the contrary, she correctly points out that the house involved in these three cases is found
on one and the same location. Verily, in his Sworn Statement submitted in Criminal Case No. 4659, Respondent Severo
[33]

Malvar stated that petitioners house was located in front of the Museum and just behind the City Hall. On the other hand,
in the Complaint for forcible entry, the subject property was said to be located along Doongan Road and right in front of
[34]

the Regional National Museum and not far behind the City Hall of Butuan City. Lastly, the Decision in Criminal Case No.
[35]

5734 stated that the building inspector, Engineer Margarita Burias, had responded to a verbal complaint involving a
structure built near the Museum in Upper Doongan, Butuan City.
Based on these factual antecedents, there is cogent basis for petitioners contention that the MTCC lacked jurisdiction
in this case.
First, respondents allege that the subject house was built by petitioner on Lot 10-A covered by TCT No. 16200. This
allegation is belied by the sketch plan dated June 16, 1994, submitted by Engineer Regino A. Lomarda Jr. To recall, in
[36]

an Order dated March 4, 1994, the RTC had required petitioner to submit a relocation survey of Lot 10-A to determine
[37]

the location of the house and to ascertain if it was the same house involved in Criminal Case No. 4659 for anti-
squatting. However, because of the Holy Week, petitioner failed to submit the relocation survey within the period provided
by the RTC. In the said sketch plan that was offered in evidence as Exhibit 5 in the anti-squatting case, Engineer Lomarda
Jr. certified that the hut of Teresita Bongato is not within Lot 10-A as shown in this plan as relocated by the undersigned
based [o]n TCT No. RT-1576 of Benjamin Eva, et al. and [o]n TCT No. RT-16200 of Lot 10-A of Severo Malvar.
Second, according to the Decision in Criminal Case No. 4659, petitioners house is actually located on Lot 1, the
parcel of land previously covered by TCT No. RT-15993 and subject of the anti-squatting case. The RTC Judge in said
case ruled:

The lot on which accuseds house is standing was formerly covered by Transfer Certificate of Title No. RT-15993 dated
January 24, 1983 in the name of Severo Malvar, and superseded by Transfer Certificate of Title No. RT-24589 dated
December 3, 1991 in the name of Butuan Land Developers Group, Inc. [38]

Third, petitioners house had actually been in existence prior to February 1992, the alleged date of illegal entry. Thus,
in Criminal Case No. 5734 for violation of PD 1096, the RTC Judge opined as follows:

Firstly, the prosecution has not proven that the accused had constructed or for that matter was constructing the questioned
house in February of 1992, since it was never stated that when the complaint was lodged with the City Engineers Office,
that the house occupied by the accused was under construction or under renovation. The fact that Engr. Burias even
admitted that she had no knowledge of when the structure was built implicitly indicates that the same was completely
erected or constructed before Engr. Burias visit, or even for that matter, before the complaint was filed. [39]

That the house of petitioner had been constructed by her father and that she had merely continued to reside therein
was upheld by the Decision, which we quote:

Suffice it to state, however, that We are convinced, given the testimonial evidence offered that the house in question was
not built by the accused, but by her father, Jacinto Bongato sometime in 1935; that accused merely lived in the house as a
member of Jacinto Bongatos family until the death of her parents, whereupon, she continued to reside in the said house
and now claims to be its owner. [40]

Fourth, Respondent Severo Malvar admitted in Criminal Case No. 4659 that he had knowledge of petitioners house
since January 1987. We quote from his testimony:
Q Earlier, Judge Malvar, you told this Honorable Court that you discovered sometime in January 1987, the accused was occupying
your property consisting of 348 square meters. What did you do upon discovering that the accused already occupied a portion
of your property without your knowledge?
A I want to demolish her house. I told her that I am the owner of the land and she is looking for the hectare that was not sold by her
father to me.
Q And upon being informed by Teresita Bongato that they were looking for the hectare lot which was not sold to you by her father,
what did you say to her?
 A I told her to remove her house. Then after that, I was so busy with the squatters along Satorre Street of the Malvar Village that
kept me so busy. It was only last year that we were able to attend to this. [41]

It is wise to be reminded that forcible entry is a quieting process, and that the restrictive time bar is prescribed to
complement the summary nature of such process. Indeed, the one-year period within which to bring an action for forcible
[42]

entry is generally counted from the date of actual entry to the land. However, when entry is made through stealth, then the
one-year period is counted from the time the plaintiff learned about it. After the lapse of the one-year period, the party
[43]

dispossessed of a parcel of land may file either an accion publiciana, which is a plenary action to recover the right of
possession; or an accion reivindicatoria, which is an action to recover ownership as well as possession. [44]

On the basis of the foregoing facts, it is clear that the cause of action for forcible entry filed by respondents had
already prescribed when they filed the Complaint for ejectment on July 10, 1992. Hence, even if Severo Malvar may be
[45]

the owner of the land, possession thereof cannot be wrested through a summary action for ejectment of petitioner, who
had been occupying it for more than one (1) year. Respondents should have presented their suit before the RTC in
[46]

an accion publiciana or an accionreivindicatoria, not before the MTCC in summary proceedings for forcible entry. Their [47]

cause of action for forcible entry had prescribed already, and the MTCC had no more jurisdiction to hear and decide it. [48]

Second Issue:
Motion to Dismiss

Petitioner further argues that a motion to dismiss based on lack of jurisdiction over the subject matter is not a
prohibited pleading, but is allowed under Sec. 19(a) of the Revised Rule on Summary Procedure. We agree. [49]

The Rule on Summary Procedure was promulgated specifically to achieve an expeditious and inexpensive
determination of cases. The speedy resolution of unlawful detainer cases is a matter of public policy, and the Rule
[50] [51]

should equally apply with full force to forcible entry cases, in which possession of the premises is already illegal from the
start. For this reason, the Rule frowns upon delays and prohibits altogether the filing of motions for extension of
[52]

time. Consistently, Section 6 was added to give the trial court the power to render judgment, even motu proprio, upon the
failure of a defendant to file an answer within the reglementary period. However, as forcible entry and detainer cases are
[53]

summary in nature and involve disturbances of the social order, procedural technicalities should be carefully
avoided and should not be allowed to override substantial justice.
[54] [55]

Pursuant to Section 36 of BP 129, the Court on June 16, 1983, promulgated the Rule on Summary Procedure in
[56] [57]

Special Cases. Under this Rule, a motion to dismiss or quash is a prohibited pleading. Under the 1991 Revised Rule on
[58]

Summary Procedure, however, a motion to dismiss on the ground of lack of jurisdiction over the subject matter is an
[59]

exception to the rule on prohibited pleadings:

SEC. 19. Prohibited pleadings and motions. The following pleadings, motions, or petitions shall not be allowed in the
cases covered by this Rule:

(a) Motion to dismiss the complaint or to quash the complaint or information except on the ground of lack
of jurisdiction over the subject matter, or failure to comply with the preceding section;

xxxxxxxxx

Further, a courts lack of jurisdiction over the subject matter cannot be waived by the parties or cured by their silence,
acquiescence or even express consent. A party may assail the jurisdiction of the court over the action at any stage of the
[60]

proceedings and even on appeal. That the MTCC can take cognizance of a motion to dismiss on the ground of lack of
[61]

jurisdiction, even if an answer has been belatedly filed we likewise held in Bayog v. Natino: [62]

The Revised Rule on Summary Procedure, as well as its predecessor, do not provide that an answer filed after the
reglementary period should be expunged from the records. As a matter of fact, there is no provision for an entry of default
if a defendant fails to answer. It must likewise be pointed out that MAGDATOs defense of lack of jurisdiction may have
even been raised in a motion to dismiss as an exception to the rule on prohibited pleadings in the Revised Rule on
Summary Procedure. Such a motion is allowed under paragraph (a) thereof, x x x.

In the case at bar, the MTCC should have squarely ruled on the issue of jurisdiction, instead of erroneously holding
that it was a prohibited pleading under the Rule on Summary Procedure. Because the Complaint for forcible entry was
[63]

filed on July 10, 1992, the 1991 Revised Rule on Summary Procedure was applicable.
 Finally, the MTCC should have taken into account petitioners Answer, in which she averred that she had been in
[64]

constant occupation on said land in question since birth on March 17, 1941 up to the present, being an heir of the late
Emiliana Eva-Bongato, who inherited said property from her father Raymundo Eva with considerable improvements
thereon. It should have heard and received the evidence adduced by the parties for the precise purpose of determining
whether or not it possessed jurisdiction over the subject matter. And after such hearing, it could have dismissed the case
[65]

for lack of jurisdiction. In this way, the long, drawn out proceedings that took place in this case could have been
[66]

avoided. [67]

WHEREFORE, the Petition is GRANTED and the assailed Decision ANNULLED and SET ASIDE. The Complaint for
forcible entry is DISMISSED for lack of jurisdiction. No pronouncement as to costs.
SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila

FIRST DIVISION

G.R. Nos. 197592 & 20262 November 27, 2013

THE PROVINCE OF AKLAN, Petitioner,

vs.
JODY KING CONSTRUCTION AND DEVELOPMENT CORP., Respondent.

DECISION

VILLARAMA, JR., J.:

These consolidated petitions for review on certiorari seek to reverse and set aside the following: (1) Decision dated October 18, 2010
1

and Resolution dated July 5, 2011 of the Court of Appeals (CA) in CA-G.R. SP No. 111754; and (2) Decision dated August 31, 2011
2 3

and Resolution dated June 27, 2012 in CA-G.R. SP No. 114073.

4

The Facts

On January 12, 1998, the Province of Aklan (petitioner) and Jody King Construction and Development Corp. (respondent) entered into
a contract for the design and -construction of the Caticlan Jetty Port and Terminal (Phase I) in Malay, Aklan. The total project cost is
₱38,900,000: P 18,700,000 for the design and construction of passenger terminal, and ₱20,200,000 for the design and construction of
the jetty port facility. In the course of construction, petitioner issued variation/change orders for additional works. The scope of work
5

under these change orders were agreed upon by petitioner and respondent. 6

On January 5, 2001, petitioner entered into a negotiated contract with respondent for the construction of Passenger Terminal Building
(Phase II) also at Caticlan Jetty Port in Malay, Aklan. The contract price for Phase II is ₱2,475,345.54. 7

On October 22, 2001, respondent made a demand for the total amount of ₱22,419,112.96 covering the following items which petitioner
allegedly failed to settle:

1. Unpaid accomplishments on additional works

undertaken - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Php 12,396,143.09

2. Refund of taxes levied despite it not being

covered by original contract- - - - - - - - - - - - - - - - - - - - - - Php 884,098.59

3. Price escalation (Consistent with Section 7.5,

Original Contract- - - - - - - - - - - - - - - - - - - - - - - - - - - - Php 1,291,714.98

4. Additional Labor Cost resulting [from]

numerous change orders issued sporadically - - - - - - - - Php 3,303,486.60

5. Additional Overhead Cost resulting [from]

numerous Orders issued sporadically - - - - - - - - - - - - - Php 1,101,162.60
 6. Interest resulting [from] payment delays
consistent with Section 7.3.b of the Original
Contract - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Php 3,442,507.50. 8

On July 13, 2006, respondent sued petitioner in the Regional Trial Court (RTC) of Marikina City (Civil Case No. 06-1122-MK) to collect
the aforesaid amounts. On August 17, 2006, the trial court issued a writ of preliminary attachment.
9 10

Petitioner denied any unpaid balance and interest due to respondent. It asserted that the sums being claimed by respondent were not
indicated in Change Order No. 3 as approved by the Office of Provincial Governor. Also cited was respondent’s June 10, 2003 letter
absolving petitioner from liability for any cost in connection with the Caticlan Passenger Terminal Project. 11

After trial, the trial court rendered its Decision on August 14, 2009, the dispositive portion of which reads:
12

WHEREFORE, foregoing premises considered, judgment is hereby rendered in favor of plaintiff Jody King Construction And
Development Corporation and against defendant Province of Aklan, as follows:

1. ordering the defendant to pay to the plaintiff the amount of Php7,396,143.09 representing the unpaid accomplishment on
additional works undertaken by the plaintiff;

2. ordering the defendant to refund to the plaintiff the amount of Php884,098.59 representing additional 2% tax levied upon
against the plaintiff;

3. ordering the defendant to pay to the plaintiff price escalation in the amount of Php1,291,714.98 pursuant to Section 7.5 of
the original contract;

4. ordering the defendant to pay to the plaintiff the amount of Php3,303,486.60 representing additional labor cost resulting
from change orders issued by the defendant;

5. ordering the defendant to pay to the plaintiff the sum of Php1,101,162.00 overhead cost resulting from change orders issued
by the defendant;

6. ordering the defendant to pay the sum of Php3,442,507.50 representing interest resulting from payment delays up to
October 15, 2001 pursuant to Section 7.3.b of the original contract;

7. ordering the defendant to pay interest of 3% per month from unpaid claims as of October 16, 2001 to date of actual payment
pursuant to Section 7.3.b[;]

8. ordering the [defendant] to pay to the plaintiff the sum of Php500,000.00 as moral damages;

9. ordering the defendant to pay to the plaintiff the sum of Php300,000.00 as exemplary damages;

10. ordering the defendant to pay the plaintiff the sum of Php200,000.00, as and for attorney’s fees; and

11. ordering the defendant to pay the cost of suit.

SO ORDERED. 13

Petitioner filed its motion for reconsideration on October 9, 2009 stating that it received a copy of the decision on September 25, 2009.
14

In its Order dated October 27, 2009, the trial court denied the motion for reconsideration upon verification from the records that as
15

shown by the return card, copy of the decision was actually received by both Assistant Provincial Prosecutor Ronaldo B. Ingente and
Atty. Lee T. Manares on September 23, 2009. Since petitioner only had until October 8, 2009 within which to file a motion for
reconsideration, its motion filed on October 9, 2009 was filed one day after the finality of the decision. The trial court further noted that
there was a deliberate attempt on both Atty. Manares and Prosecutor Ingente to mislead the court and make it appear that their motion
for reconsideration was filed on time. Petitioner filed a Manifestation reiterating the explanation set forth in its Rejoinder to
16

respondent’s comment/opposition and motion to dismiss that the wrong date of receipt of the decision stated in the motion for
reconsideration was due to pure inadvertence attributable to the staff of petitioner’s counsel. It stressed that there was no intention to
mislead the trial court nor cause undue prejudice to the case, as in fact its counsel immediately corrected the error upon discovery by
explaining the attendant circumstances in the Rejoinder dated October 29, 2009.

On November 24, 2009, the trial court issued a writ of execution ordering Sheriff IV Antonio E. Gamboa, Jr. to demand from petitioner
the immediate payment of ₱67,027,378.34 and tender the same to the respondent. Consequently, Sheriff Gamboa served notices of
garnishment on Land Bank of the Philippines, Philippine National Bank and Development Bank of the Philippines at their branches in
Kalibo, Aklan for the satisfaction of the judgment debt from the funds deposited under the account of petitioner. Said banks, however,
refused to give due course to the court order, citing the relevant provisions of statutes, circulars and jurisprudence on the determination
of government monetary liabilities, their enforcement and satisfaction. 17

Petitioner filed in the CA a petition for certiorari with application for temporary restraining order (TRO) and preliminary injunction
assailing the Writ of Execution dated November 24, 2009, docketed as CA-G.R. SP No. 111754.

On December 7, 2009, the trial court denied petitioner’s notice of appeal filed on December 1, 2009. Petitioner’s motion for
reconsideration of the December 7, 2009 Order was likewise denied. On May 20, 2010, petitioner filed another petition for certiorari in
18

the CA questioning the aforesaid orders denying due course to its notice of appeal, docketed as CA-G.R. SP No. 114073.

By Decision dated October 18, 2010, the CA’s First Division dismissed the petition in CA-G.R. SP No. 111754 as it found no grave
abuse of discretion in the lower court’s issuance of the writ of execution. Petitioner filed a motion for reconsideration which was likewise
denied by the CA. The CA stressed that even assuming as true the alleged errors committed by the trial court, these were insufficient
for a ruling that grave abuse of discretion had been committed. On the matter of execution of the trial court’s decision, the appellate
court said that it was rendered moot by respondent’s filing of a petition before the Commission on Audit (COA).

On August 31, 2011, the CA’s Sixteenth Division rendered its Decision dismissing the petition in CA-G.R. SP No. 114073. The CA said
that petitioner failed to provide valid justification for its failure to file a timely motion for reconsideration; counsel’s explanation that he
believed in good faith that the August 14, 2009 Decision of the trial court was received on September 25, 2009 because it was handed
to him by his personnel only on that day is not a justifiable excuse that would warrant the relaxation of the rule on reglementary period
of appeal. The CA also held that petitioner is estopped from invoking the doctrine of primary jurisdiction as it only raised the issue of
COA’s primary jurisdiction after its notice of appeal was denied and a writ of execution was issued against it.

The Cases

In G.R. No. 197592, petitioner submits the following issues:

I.

WHETHER OR NOT THE DECISION DATED 14 AUGUST 2009 RENDERED BY THE REGIONAL TRIAL COURT, BRANCH
273, MARIKINA CITY AND THE WRIT OF EXECUTION DATED 24 NOVEMBER 2009 SHOULD BE RENDERED VOID FOR
LACK OF JURISDICTION OVER THE SUBJECT MATTER OF THE CASE.

II.

WHETHER OR NOT THE REGIONAL TRIAL COURT, BRANCH 273, MARIKINA CITY GRAVELY ABUSED ITS
DISCRETION AMOUNTING TO LACK OR IN EXCESS OF JURISDICTION IN RENDERING THE DECISION DATED 14
AUGUST 2009 AND ISSUING THE WRIT OF EXECUTION DATED 24 NOVEMBER 2009 EVEN IT FAILED TO DISPOSE
ALL THE ISSUES OF THE CASE BY NOT RESOLVING PETITIONER’S "URGENT MOTION TO DISCHARGE EX-PARTE
WRIT OF PRELIMINARY ATTACHMENT" DATED 31 AUGUST 2006.

III.

WHETHER OR NOT THE WRIT OF EXECUTION DATED 24 NOVEMBER 2009 WHICH WAS HASTILY ISSUED IN
VIOLATION OF SUPREME COURT ADMINISTRATIVE CIRCULAR NO. 10-2000 SHOULD BE RENDERED VOID. 19

The petition in G.R. No. 202623 sets forth the following arguments:

Petitioner is not estopped in questioning the jurisdiction of the Regional Trial Court, Branch 273, Marikina City over the subject matter of
the case.20

The petition for certiorari filed before the CA due to the RTC’s denial of petitioner’s Notice of Appeal was in accord with jurisprudence. 21

The Issues

The controversy boils down to the following issues: (1) the applicability of the doctrine of primary jurisdiction to this case; and (2) the
propriety of the issuance of the writ of execution.

Our Ruling

The petitions are meritorious.

COA has primary jurisdiction over private respondent’s money claims Petitioner is not estopped from raising the issue of jurisdiction

The doctrine of primary jurisdiction holds that if a case is such that its determination requires the expertise, specialized training and
knowledge of the proper administrative bodies, relief must first be obtained in an administrative proceeding before a remedy is supplied
by the courts even if the matter may well be within their proper jurisdiction. It applies where a claim is originally cognizable in the
22

courts, and comes into play whenever enforcement of the claim requires the resolution of issues which, under a regulatory scheme,
have been placed within the special competence of an administrative agency. In such a case, the court in which the claim is sought to
be enforced may suspend the judicial process pending referral of such issues to the administrative body for its view or, if the parties
would not be unfairly disadvantaged, dismiss the case without prejudice. 23

The objective of the doctrine of primary jurisdiction is to guide the court in determining whether it should refrain from exercising its
jurisdiction until after an administrative agency has determined some question or some aspect of some question arising in the
proceeding before the court. 24

As can be gleaned, respondent seeks to enforce a claim for sums of money allegedly owed by petitioner, a local government unit.

Under Commonwealth Act No. 327, as amended by Section 26 of Presidential Decree No. 1445, it is the COA which has primary
25 26

jurisdiction over money claims against government agencies and instrumentalities.

Section 26. General jurisdiction. The authority and powers of the Commission shall extend to and comprehend all matters relating to
auditing procedures, systems and controls, the keeping of the general accounts of the Government, the preservation of vouchers
pertaining thereto for a period of ten years, the examination and inspection of the books, records, and papers relating to those
accounts; and the audit and settlement of the accounts of all persons respecting funds or property received or held by them in an
accountable capacity, as well as the examination, audit, and settlement of all debts and claims of any sort due from or owing to the
Government or any of its subdivisions, agencies and instrumentalities. The said jurisdiction extends to all government-owned or
controlled corporations, including their subsidiaries, and other self-governing boards, commissions, or agencies of the Government, and
as herein prescribed, including non-governmental entities subsidized by the government, those funded by donations through the
government, those required to pay levies or government share, and those for which the government has put up a counterpart fund or
those partly funded by the government. (Emphasis supplied.)

Pursuant to its rule-making authority conferred by the 1987 Constitution and existing laws, the COA promulgated the 2009 Revised
27

Rules of Procedure of the Commission on Audit. Rule II, Section 1 specifically enumerated those matters falling under COA’s exclusive
jurisdiction, which include "money claims due from or owing to any government agency." Rule VIII, Section 1 further provides:

Section 1. Original Jurisdiction - The Commission Proper shall have original jurisdiction over:

a) money claim against the Government; b) request for concurrence in the hiring of legal retainers by government agency; c) write off of
unliquidated cash advances and dormant accounts receivable in amounts exceeding one million pesos (₱1,000,000.00); d) request for
relief from accountability for loses due to acts of man, i.e. theft, robbery, arson, etc, in amounts in excess of Five Million pesos
(₱5,000,000.00).

In Euro-Med Laboratories Phil., Inc. v. Province of Batangas, we ruled that it is the COA and not the RTC which has primary
28

jurisdiction to pass upon petitioner’s money claim against respondent local government unit. Such jurisdiction may not be waived by the
parties’ failure to argue the issue nor active participation in the proceedings. Thus:

This case is one over which the doctrine of primary jurisdiction clearly held sway for although petitioner’s collection suit for ₱487,662.80
was within the jurisdiction of the RTC, the circumstances surrounding petitioner’s claim brought it clearly within the ambit of the COA’s
jurisdiction.

First, petitioner was seeking the enforcement of a claim for a certain amount of money against a local government unit. This brought the
case within the COA’s domain to pass upon money claims against the government or any subdivision thereof under Section 26 of the
Government Auditing Code of the Philippines:

The authority and powers of the Commission [on Audit] shall extend to and comprehend all matters relating to x x x the examination,
audit, and settlement of all debts and claims of any sort due from or owing to the Government or any of its subdivisions, agencies, and
instrumentalities. x x x.

The scope of the COA’s authority to take cognizance of claims is circumscribed, however, by an unbroken line of cases holding statutes
of similar import to mean only liquidated claims, or those determined or readily determinable from vouchers, invoices, and such other
papers within reach of accounting officers. Petitioner’s claim was for a fixed amount and although respondent took issue with the
accuracy of petitioner’s summation of its accountabilities, the amount thereof was readily determinable from the receipts, invoices and
other documents. Thus, the claim was well within the COA’s jurisdiction under the Government Auditing Code of the Philippines.
Second, petitioner’s money claim was founded on a series of purchases for the medical supplies of respondent’s public hospitals. Both
parties agreed that these transactions were governed by the Local Government Code provisions on supply and property management
and their implementing rules and regulations promulgated by the COA pursuant to Section 383 of said Code. Petitioner’s claim
therefore involved compliance with applicable auditing laws and rules on procurement. Such matters are not within the usual area of
knowledge, experience and expertise of most judges but within the special competence of COA auditors and accountants. Thus, it was
but proper, out of fidelity to the doctrine of primary jurisdiction, for the RTC to dismiss petitioner’s complaint.

Petitioner argues, however, that respondent could no longer question the RTC’s jurisdiction over the matter after it had filed its answer
and participated in the subsequent proceedings. To this, we need only state that the court may raise the issue of primary jurisdiction
sua sponte and its invocation cannot be waived by the failure of the parties to argue it as the doctrine exists for the proper distribution of
power between judicial and administrative bodies and not for the convenience of the parties. (Emphasis supplied.)
29

Respondent’s collection suit being directed against a local government unit, such money claim should have been first brought to the
COA. Hence, the RTC should have suspended the proceedings and refer the filing of the claim before the COA. Moreover, petitioner is
30

not estopped from raising the issue of jurisdiction even after the denial of its notice of appeal and before the CA.

There are established exceptions to the doctrine of primary jurisdiction, such as: (a) where there is estoppel on the part of the party
invoking the doctrine; (b) where the challenged administrative act is patently illegal, amounting to lack of jurisdiction; (c) where there is
unreasonable delay or official inaction that will irretrievably prejudice the complainant; (d) where the amount involved is relatively small
so as to make the rule impractical and oppressive; (e) where the question involved is purely legal and will ultimately have to be decided
by the courts of justice; (f) where judicial intervention is urgent; (g) when its application may cause great and irreparable damage; (h)
where the controverted acts violate due process; (i) when the issue of non-exhaustion of administrative remedies has been rendered
moot; (j) when there is no other plain, speedy and adequate remedy; (k) when strong public interest is involved; and, (l) in quo warranto
proceedings. However, none of the foregoing circumstances is applicable in the present case.
31

The doctrine of primary jurisdiction does not warrant a court to arrogate unto itself authority to resolve a controversy the jurisdiction over
which is initially lodged with an administrative body of special competence. All the proceedings of the court in violation of the doctrine
32

and all orders and decisions rendered thereby are null and void. 33

Writ of Execution issued in violation of COA’s primary jurisdiction is void

Since a judgment rendered by a body or tribunal that has no jurisdiction over the subject matter of the case is no judgment at all, it
cannot be the source of any right or the creator of any obligation. All acts pursuant to it and all claims emanating from it have no legal
34

effect and the void judgment can never be final and any writ of execution based on it is likewise void. 35

Clearly, the CA erred in ruling that the RTC committed no grave abuse of discretion when it ordered the execution of its judgment
against petitioner and garnishment of the latter’s funds.

In its Supplement to the Motion for Reconsideration, petitioner argued that it is the COA and not the RTC which has original jurisdiction
over money claim against government agencies and subdivisions. The CA, in denying petitioner's motion for reconsideration, simply
1âwphi 1

stated that the issue had become moot by respondent's filing of the proper petition with the COA. However, respondent's belated
compliance with the formal requirements of presenting its money claim before the COA did not cure the serious errors committed by the
RTC in implementing its void decision. The RTC's orders implementing its judgment rendered without jurisdiction must be set aside
because a void judgment can never be validly executed.

Finally, the RTC should have exercised utmost caution, prudence and judiciousness in issuing the writ of execution and notices of
garnishment against petitioner. The RTC had no authority to direct the immediate withdrawal of any portion of the garnished funds from
petitioner's depositary banks. Such act violated the express directives of this Court under Administrative Circular No. 10-2000, which
36 37

was issued "precisely in order to prevent the circumvention of Presidential Decree No. 1445, as well as of the rules and procedures of
the COA." WHEREFORE, both petitions in G.R. Nos. 197592 and 202623 are GRANTED. The Decision dated October 18, 2010 and
38

Resolution dated July 5 2011 of the Court of Appeals in CA-G.R. SP No. 111754, and Decision dated August 31, 2011 and Resolution
dated June 27, 2012 in CA- G.R. SP No. 114073 are hereby REVERSED and SET ASIDE. The Decision dated August 14 2009, Writ of
Execution and subsequent issuances implementing the said decision of the Regional Trial Court of Marikina City in Civil Case No. 06-
1122-MK are all SET ASIDE. No pronouncement as to costs.

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila

THIRD DIVISION
G.R. NO. 144322 February 6, 2007

METROPOLITAN BANK and TRUST COMPANY, INC., Petitioner,

vs.
NATIONAL WAGES AND PRODUCTIVITY COMMISSION and REGIONAL TRIPARTITE WAGES AND PRODUCTIVITY BOARD -
REGION II, Respondents.

DECISION

AUSTRIA-MARTINEZ, J.:

Before the Court is a Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court seeking the reversal of the
Decision1 of the Court of Appeals (CA) dated July 19, 2000 in CA-G.R. SP No. 42240 which denied the petition for certiorari and
prohibition of Metropolitan Bank and Trust Company, Inc. (petitioner).

The procedural antecedents and factual background of the case are as follows:

On October 17, 1995, the Regional Tripartite Wages and Productivity Board, Region II, Tuguegarao, Cagayan (RTWPB), by virtue of
Republic Act No. 6727 (R.A. No. 6727), otherwise known as the Wage Rationalization Act, 2issued Wage Order No. R02-03 (Wage
Order), as follows:

Section 1. Upon effectivity of this Wage Order, all employees/workers in the private sector throughout Region II, regardless of the status
of employment are granted an across-the-board increase of ₱15.00 daily.3

The Wage Order was published in a newspaper of general circulation on December 2, 1995 4 and took effect on January 1, 1996.5 Its
Implementing Rules6 were approved on February 14, 1996.7 Per Section 13 of the Wage Order, any party aggrieved by the Wage Order
may file an appeal with the National Wages and Productivity Commission (NWPC) through the RTWPB within 10 calendar days from
the publication of the Wage Order.

In a letter-inquiry to the NWPC dated May 7, 1996, the Bankers' Council for Personnel Management (BCPM), on behalf of its member-
banks, requested for a ruling on the eligibility of establishments with head offices outside Region II to seek exemption from the
coverage of the Wage Order since its member-banks are already paying more than the prevailing minimum wage rate in the National
Capital Region (NCR), which is their principal place of business.8

In a letter-reply dated July 16, 1996, the NWPC stated that the member-banks of BCPM are covered by the Wage Order and do not fall
under the exemptible categories listed under the Wage Order. 9

In a letter-inquiry to the NWPC dated July 23, 1996, petitioner sought for interpretation of the applicability of said Wage Order.10 The
NWPC referred petitioner's inquiry to the RTWPB.

In a letter-reply dated August 12, 1996, the RTWPB clarified that the Wage Order covers all private establishments situated in Region
II, regardless of the voluntary adoption by said establishments of the wage orders established in Metro Manila and irrespective of the
amounts already paid by the petitioner.11

On October 15, 1996, the petitioner filed a Petition for Certiorari and Prohibition with the CA seeking nullification of the Wage Order on
grounds that the RTWPB acted without authority when it issued the questioned Wage Order; that even assuming that the RTWPB was
vested with the authority to prescribe an increase, it exceeded its authority when it did so without any ceiling or qualification; that the
implementation of the Wage Order will cause the petitioner, and other similarly situated employers, to incur huge financial losses and
suffer labor unrest.12

On March 24, 1997, the Office of the Solicitor General (OSG) filed a Manifestation and Motion in lieu of Comment affirming the
petitioner's claim that the RTWPB acted beyond its authority in issuing the Wage Order prescribing an across-the-board increase to all
workers and employees in Region II, effectively granting additional or other benefits not contemplated by R.A. No. 6727. 13

In view of the OSG's manifestation, the CA directed respondents NWPC and RTWPB to file their comment.14

On September 22, 1997, respondents filed their Comment praying that the petition should be dismissed outright for petitioner's
procedural lapses; that certiorari and prohibition are unavailing since petitioner failed to avail of the remedy of appeal prescribed by the
Wage Order; that the Wage Order has long been in effect; and that the issuance of the Wage Order was performed in the exercise of a
purely administrative function.15

On July 19, 2000, the CA rendered its Decision denying the petition. The appellate court held that a writ of prohibition can no longer be
issued since implementation of the Wage Order had long become fait accompli, the Wage Order having taken effect on January 1,
1996 and its implementing rules approved on February 14, 1996; that a writ of certiorari is improper since the Wage Order was issued
in the exercise of a purely administrative function, not judicial or quasi-judicial; that the letter-query did not present justiciable
controversies ripe for consideration by the respondents in the exercise of their wage-fixing function, since no appeal from the Wage
Order was filed; that petitioner never brought before the said bodies any formal and definite challenge to the Wage Order and it cannot
pass off the letter-queries as actual applications for relief; that even if petitioner's procedural lapse is disregarded, a regional wage
order prescribing a wage increase across-the-board applies to banks adopting a unified wage system and a disparity in wages between
employees holding similar positions in different regions is not wage distortion.16

Hence, the present petition anchored on the following grounds:

4.1 THE COURT OF APPEALS ERRED IN REFUSING TO DECLARE WAGE ORDER NO. R02-03 NULL AND VOID AND
OF NO LEGAL EFFECT.

4.1.1 THE BOARD, IN ISSUING WAGE ORDER NO. R02-03, EXCEEDED THE AUTHORITY DELEGATED TO IT
BY CONGRESS.

4.1.2 WAGE ORDER NO. R02-03 IS AN UNREASONABLE INTRUSION INTO THE PROPERTY RIGHTS OF
PETITIONER.

4.1.3 WAGE ORDER NO. R02-03 UNDERMINES THE VERY ESSENCE OF COLLECTIVE BARGAINING.

4.1.4 WAGE ORDER NO. R02-03 FAILS TO TAKE INTO ACCOUNT THE VERY RATIONALE FOR A UNIFIED
WAGE STRUCTURE.

4.2 PETITIONER'S RECOURSE TO A WRIT OF CERTIORARI AND PROHIBITION WAS PROPER.17

Following the submission of the Comment18 and Reply19 thereto, the Court gave due course to the petition and required both parties to
submit their respective memoranda.20 In compliance therewith, petitioner and respondents submitted their respective memoranda. 21

Petitioner poses two issues for resolution, to wit: (1) whether Wage Order No. R02-03 is void and of no legal effect; and (2) whether
petitioner's recourse to a petition for certiorari and prohibition with the CA was proper.

Anent the first issue, petitioner maintains that the RTWPB, in issuing said Wage Order, exceeded the authority delegated to it under
R.A. No. 6727, which is limited to determining and fixing the minimum wage rate within their respective territorial jurisdiction and with
respect only to employees who do not earn the prescribed minimum wage rate; that the RTWPB is not authorized to grant a general
across-the-board wage increase for non-minimum wage earners; that Employers Confederation of the Philippines v. National Wages
and Productivity Commission22(hereafter referred to as "ECOP") is not authority to rule that respondents have been empowered to fix
wages other than the minimum wage since said case dealt with an across-the-board increase with a salary ceiling, where the wage
adjustment is applied to employees receiving a certain denominated salary ceiling; that the Wage Order is an unreasonable intrusion
into its property rights; that the Wage Order undermines the essence of collective bargaining; that the Wage Order fails to take into
account the rationale for a unified wage structure.

As to the second issue, petitioner submits that ultra vires acts of administrative agencies are correctible by way of a writ of certiorari and
prohibition; that even assuming that it did not observe the proper remedial procedure in challenging the Wage Order, the remedy
of certiorari and prohibition remains available to it by way of an exception, on grounds of justice and equity; that its failure to observe
procedural rules could not have validated the manner by which the disputed Wage Order was issued.

Respondents counter that the present petition is fatally defective from inception since no appeal from the Wage Order was filed by
petitioner; that the letter-query to the NWPC did not constitute the appeal contemplated by law; that the validity of the Wage Order was
never raised before the respondents; that the implementation of the Wage Order had long become fait accompli for prohibition to
prosper. Respondents insist that, even if petitioner's procedural lapses are disregarded, the Wage Order was issued pursuant to the
mandate of R.A. No. 6727 and in accordance with the Court's pronouncements in the ECOP case; 23 that the Wage Order is not an
intrusion on property rights since it was issued after the required public hearings; that the Wage Order does not undermine but in fact
recognizes the right to collective bargaining; that the Wage Order did not result in wage distortion.

The Court shall first dispose of the procedural matter relating to the propriety of petitioner's recourse to the CA before proceeding with
the substantive issue involving the validity of the Wage Order.

Certiorari as a special civil action is available only if the following essential requisites concur: (1) it must be directed against a tribunal,
board, or officer exercising judicial or quasi-judicial functions; (2) the tribunal, board, or officer must have acted without or in excess of
jurisdiction or with grave abuse of discretion amounting lack or excess of jurisdiction; and (3) there is no appeal nor any plain, speedy,
and adequate remedy in the ordinary course of law.24
On the other hand, prohibition as a special civil action is available only if the following essential requisites concur: (1) it must be directed
against a tribunal, corporation, board, officer, or person exercising functions, judicial, quasi-judicial, or ministerial; (2) the tribunal,
corporation, board or person has acted without or in excess of its jurisdiction, or with grave abuse of discretion amounting lack or
excess of jurisdiction; and (3) there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law.25

A respondent is said to be exercising judicial function where he has the power to determine what the law is and what the legal rights of
the parties are, and then undertakes to determine these questions and adjudicate upon the rights of the parties. 26 Quasi-judicial function
is a term which applies to the action, discretion, etc., of public administrative officers or bodies, who are required to investigate facts or
ascertain the existence of facts, hold hearings, and draw conclusions from them as a basis for their official action and to exercise
discretion of a judicial nature.27 Ministerial function is one which an officer or tribunal performs in the context of a given set of facts, in a
prescribed manner and without regard to the exercise of his own judgment upon the propriety or impropriety of the act done. 28

In the issuance of the assailed Wage Order, respondent RTWPB did not act in any judicial, quasi-judicial capacity, or ministerial
capacity. It was in the nature of subordinate legislation, promulgated by it in the exercise of delegated power under R.A. No. 6727. It
was issued in the exercise of quasi-legislative power. Quasi-legislative or rule-making power is exercised by administrative agencies
through the promulgation of rules and regulations within the confines of the granting statute and the doctrine of non-delegation of
certain powers flowing from the separation of the great branches of the government. 29

Moreover, the rule on the special civil actions of certiorari and prohibition equally mandate that these extra-ordinary remedies are
available only when "there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law." A remedy is
considered plain, speedy and adequate if it will promptly relieve the petitioner from the injurious effects of the judgment or rule, order or
resolution of the lower court or agency.30

Section 13 of the assailed Wage Order explicitly provides that any party aggrieved by the Wage Order may file an appeal with the
NWPC through the RTWPB within 10 days from the publication of the wage order.31 The Wage Order was published in a newspaper of
general circulation on December 2, 1995.32

In this case, petitioner did not avail of the remedy provided by law. No appeal to the NWPC was filed by the petitioner within 10
calendar days from publication of the Wage Order on December 2, 1995. Petitioner was silent until seven months later, when it filed a
letter-inquiry on July 24, 1996 with the NWPC seeking a clarification on the application of the Wage Order. Evidently, the letter-inquiry is
not an appeal.

It must also be noted that the NWPC only referred petitioner's letter-inquiry to the RTWPB. Petitioner did not appeal the letter-reply
dated August 12, 1996 of the RTWPB to the NWPC. No direct action was taken by the NWPC on the issuance or implementation of the
Wage Order. Petitioner failed to invoke the power of the NWPC to review regional wage levels set by the RTWPB to determine if these
are in accordance with prescribed guidelines. Thus, not only was it improper to implead the NWPC as party-respondent in the petition
before the CA and this Court, but also petitioner failed to avail of the primary jurisdiction of the NWPC under Article 121 of the Labor
Code, to wit:

ART. 121. Powers and Functions of the Commission. - The Commission shall have the following powers and functions:

xxxx

(d) To review regional wage levels set by the Regional Tripartite Wages and Productivity Boards to determine if these are in
accordance with prescribed guidelines and national development plans;

xxxx

(f) To review plans and programs of the Regional Tripartite Wages and Productivity Boards to determine whether these are
consistent with national development plans;

(g) To exercise technical and administrative supervision over the Regional Tripartite Wages and Productivity Boards;

xxxx

(Emphasis supplied)

Under the doctrine of primary jurisdiction, courts cannot and will not resolve a controversy involving a question which is within the
jurisdiction of an administrative tribunal, especially where the question demands the exercise of sound administrative discretion
requiring the special knowledge, experience and services of the administrative tribunal to determine technical and intricate matters of
fact.33
Nevertheless, the Court will proceed to resolve the substantial issues in the present petition pursuant to the well-accepted principle that
acceptance of a petition for certiorari or prohibition as well as the grant of due course thereto is addressed to the sound discretion of the
court.34 It is a well-entrenched principle that rules of procedure are not inflexible tools designed to hinder or delay, but to facilitate and
promote the administration of justice. Their strict and rigid application, which would result in technicalities that tend to frustrate, rather
than promote substantial justice, must always be eschewed. 35

As to respondents' submission that the implementation of the Wage Order can no longer be restrained since it has become fait
accompli, the Wage Order having taken effect on January 1, 1996 and its implementing rules approved on February 14, 1996, suffice it
to state that courts will decide a question otherwise moot if it is capable of repetition yet evading review. 36 Besides, a case becomes
moot and academic only when there is no more actual controversy between the parties or no useful purpose can be served in passing
upon the merits. Such circumstances do not obtain in the present case. The implementation of the Wage Order does not in any way
render the case moot and academic, since the issue of the validity of the wage order subsists even after its implementation and which
has to be determined and passed upon to resolve petitioner's rights and consequent obligations therein.

It is worthy to quote the Court's pronouncements in Tan v. Commission on Elections, 37 thus:

For this Honorable Court to yield to the respondents' urging that, as there has been fait accompli, then this Honorable Court should
passively accept and accede to the prevailing situation is an unacceptable suggestion. Dismissal of the instant petition, as respondents
so propose is a proposition fraught with mischief. Respondents' submission will create a dangerous precedent. Should this Honorable
Court decline now to perform its duty of interpreting and indicating what the law is and should be, this might tempt again those who strut
about in the corridors of power to recklessly and with ulterior motives commit illegal acts, either brazenly or stealthily, confident that this
Honorable Court will abstain from entertaining future challenges to their acts if they manage to bring about a fait accompli. 38

Having disposed of this procedural issue, the Court now comes to the substance of the petition.

R.A. No. 6727 declared it a policy of the State to rationalize the fixing of minimum wages and to promote productivity-improvement and
gain-sharing measures to ensure a decent standard of living for the workers and their families; to guarantee the rights of labor to its just
share in the fruits of production; to enhance employment generation in the countryside through industrial dispersal; and to allow
business and industry reasonable returns on investment, expansion and growth. 39

In line with its declared policy, R.A. No. 672740 created the NWPC,41 vested with the power to prescribe rules and guidelines for the
determination of appropriate minimum wage and productivity measures at the regional, provincial or industry levels; 42 and authorized
the RTWPB to determine and fix the minimum wage rates applicable in their respective regions, provinces, or industries therein and
issue the corresponding wage orders, subject to the guidelines issued by the NWPC.43 Pursuant to its wage fixing authority, the RTWPB
may issue wage orders which set the daily minimum wage rates, 44 based on the standards or criteria set by Article 124 45 of the Labor
Code.

In ECOP,46 the Court declared that there are two ways of fixing the minimum wage: the "floor-wage" method and the "salary-ceiling"
method. The "floor-wage" method involves the fixing of a determinate amount to be added to the prevailing statutory minimum wage
rates. On the other hand, in the "salary-ceiling" method, the wage adjustment was to be applied to employees receiving a certain
denominated salary ceiling. In other words, workers already being paid more than the existing minimum wage (up to a certain amount
stated in the Wage Order) are also to be given a wage increase.47

To illustrate: under the "floor wage method", it would have been sufficient if the Wage Order simply set ₱15.00 as the amount to be
added to the prevailing statutory minimum wage rates, while in the "salary-ceiling method", it would have been sufficient if the Wage
Order states a specific salary, such as ₱250.00, and only those earning below it shall be entitled to the salary increase.

In the present case, the RTWPB did not determine or fix the minimum wage rate by the "floor-wage method" or the "salary-ceiling
method" in issuing the Wage Order. The RTWPB did not set a wage level nor a range to which a wage adjustment or increase shall be
added. Instead, it granted an across-the-board wage increase of ₱15.00 to all employees and workers of Region 2. In doing so, the
RTWPB exceeded its authority by extending the coverage of the Wage Order to wage earners receiving more than the prevailing
minimum wage rate, without a denominated salary ceiling. As correctly pointed out by the OSG, the Wage Order granted additional
benefits not contemplated by R.A. No. 6727.

In no uncertain terms must it be stressed that the function of promulgating rules and regulations may be legitimately exercised only for
the purpose of carrying out the provisions of a law. The power of administrative agencies is confined to implementing the law or putting
it into effect. Corollary to this guideline is that administrative regulation cannot extend the law and amend a legislative enactment.48 It is
axiomatic that the clear letter of the law is controlling and cannot be amended by a mere administrative rule issued for its
implementation.49 Indeed, administrative or executive acts, orders, and regulations shall be valid only when they are not contrary to the
laws or the Constitution.50

Where the legislature has delegated to an executive or administrative officers and boards authority to promulgate rules to carry out an
express legislative purpose, the rules of administrative officers and boards, which have the effect of extending, or which conflict with the
authority-granting statute, do not represent a valid exercise of the rule-making power but constitute an attempt by an administrative
body to legislate.51
It has been said that when the application of an administrative issuance modifies existing laws or exceeds the intended scope, as in this
case, the issuance becomes void, not only for being ultra vires, but also for being unreasonable. 52

Thus, the Court finds that Section 1, Wage Order No. R02-03 is void insofar as it grants a wage increase to employees earning more
than the minimum wage rate; and pursuant to the separability clause53 of the Wage Order, Section 1 is declared valid with respect to
employees earning the prevailing minimum wage rate. 1awphi 1.net

Prior to the passage of the Wage Order, the daily minimum wage rates in Region II was set at ₱104.00 for the Province of Isabela,
₱103.00 for the Province of Cagayan, ₱101.00 for the Province of Nueva Vizcaya, and ₱100.00 for the Provinces of Quirino and
Batanes.54 Only employees earning the above-stated minimum wage rates are entitled to the ₱15.00 mandated increase under the
Wage Order.

Although the concomitant effect of the nullity of the Wage Order to those employees who have received the mandated increase was not
put in issue, this Court shall make a definite pronouncement thereon to finally put this case to rest. As ruled by the Court in Latchme
Motoomull v. Dela Paz,55 "the Court will always strive to settle the entire controversy in a single proceeding leaving no root or branch to
bear the seeds of future litigation."56

Applying by analogy, the Court's recent pronouncement in Philippine Ports Authority v. Commission on Audit, 57 thus:

In regard to the refund of the disallowed benefits, this Court holds that petitioners need not refund the benefits received by them based
on our rulings in Blaquera v. Alcala, De Jesus v. Commission on Audit and Kapisanan ng mga Manggagawa sa Government Service
Insurance System (KMG) v. Commission on Audit.

In Blaquera, the petitioners, who were officials and employees of several government departments and agencies, were paid incentive
benefits pursuant to EO No. 292 and the Omnibus Rules Implementing Book V of EO No. 292. On January 3, 1993, then President
Fidel V. Ramos issued Administrative Order (AO) No. 29 authorizing the grant of productivity incentive benefits for the year 1992 in the
maximum amount of ₱1,000. Section 4 of AO No. 29 directed all departments, offices and agencies which authorized payment of CY
1992 Productivity Incentive Bonus in excess of ₱1,000 to immediately cause the refund of the excess. Respondent heads of the
departments or agencies of the government concerned caused the deduction from petitioners' salaries or allowances of the amounts
needed to cover the overpayments. Petitioners therein filed a petition for certiorari and prohibition before this Court to prevent
respondents therein from making further deductions from their salaries or allowances. The Court ruled against the refund, thus:

Considering, however, that all the parties here acted in good faith, we cannot countenance the refund of subject incentive
benefits for the year 1992, which amounts the petitioners have already received. Indeed, no indicia of bad faith can be
detected under the attendant facts and circumstances. The officials and chiefs of offices concerned disbursed such incentive
benefits in the honest belief that the amounts given were due to the recipients and the latter accepted the same with gratitude,
confident that they richly deserve such benefits.

The said ruling in Blaquera was applied in De Jesus.

In De Jesus, COA disallowed the payment of allowances and bonuses consisting of representation and transportation allowance, rice
allowance, productivity incentive bonus, anniversary bonus, year-end bonus and cash gifts to members of the interim Board of Directors
of the Catbalogan Water District. This Court affirmed the disallowance because petitioners therein were not entitled to other
compensation except for payment of per diemunder PD No. 198. However, the Court ruled against the refund of the allowances and
bonuses received by petitioners, thus:

This ruling in Blaquera applies to the instant case. Petitioners here received the additional allowances and bonuses in good faith
under the honest belief that LWUA Board Resolution No. 313 authorized such payment. At the time petitioners received the
additional allowances and bonuses, the Court had not yet decided Baybay Water District. Petitioners had no knowledge that
such payment was without legal basis. Thus, being in good faith, petitioners need not refund the allowances and bonuses
they received but disallowed by the COA.

Further, in KMG, this Court applied the ruling in Blaquera and De Jesus in holding that the Social Insurance Group (SIG) personnel of
the Government Service Insurance System need not refund the hazard pay received by them although said benefit was correctly
disallowed by COA. The Court ruled:

The Court however finds that the DOH and GSIS officials concerned who granted hazard pay under R.A. No. 7305 to the SIG
personnel acted in good faith, in the honest belief that there was legal basis for such grant. The SIG personnel in turn
accepted the hazard pay benefits likewise believing that they were entitled to such benefit. At that time, neither the concerned
DOH and GSIS officials nor the SIG personnel knew that the grant of hazard pay to the latter is not sanctioned by law. Thus,
following the rulings of the Court in De Jesus v. Commission on Audit, and Blaquera v. Alcala, the SIG personnel who
previously received hazard pay under R.A. No. 7305 need not refund such benefits.
In the same vein, the rulings in Blaquera, De Jesus and KMG apply to this case. Petitioners received the hazard duty pay and birthday
cash gift in good faith since the benefits were authorized by PPA Special Order No. 407-97 issued pursuant to PPA Memorandum
Circular No. 34-95 implementing DBM National Compensation Circular No. 76, series of 1995, and PPA Memorandum Circular No. 22-
97, respectively. Petitioners at that time had no knowledge that the payment of said benefits lacked legal basis. Being in good faith,
petitioners need not refund the benefits they received. 58 (Emphasis supplied)

employees, other than minimum wage earners, who received the wage increase mandated by the Wage Order need not refund the
wage increase received by them since they received the wage increase in good faith, in the honest belief that they are entitled to such
wage increase and without any knowledge that there was no legal basis for the same.

Considering the foregoing, the Court need not delve on the other arguments raised by the parties.

WHEREFORE, the petition is PARTIALLY GRANTED. The Decision of the Court of Appeals dated July 19, 2000 in CA-G.R. SP No.
42240 is MODIFIED. Section 1 of Wage Order No. R02-03 issued on October 17, 1995 by the Regional Tripartite Wages and
Productivity Board for Region II, Tuguegarao, Cagayan is declared VALID insofar as the mandated increase applies to employees
earning the prevailing minimum wage rate at the time of the passage of the Wage Order and VOID with respect to its application to
employees receiving more than the prevailing minimum wage rate at the time of the passage of the Wage Order.

No costs.

SO ORDERED.