RULE 1

JOSEFINA POTESTAS CABRERA and CRESENCIA POTESTAS OMULON, plaintiffs-appellees, vs.

MARIANO T. TIANO, defendantappellant.

1. PRESCRIPTION OF ACTIONS; INTERRUPTION BY COMMENCEMENT OF SUIT; COUNTED

FROM DATE OF FILING COMPLAINT.
2. PRESCRIPTION; REQUIRES POSSESSION IN GOOD FAITH WITH JUST TITLE; EFFECT OF
LACK OF FINDING OF FACT BY LOWER COURT.

Facts:
Ciriaco Potestas and Gregoria Blanco, were parents of five children, Isabelo, Lourdes, Clemente,
Josefina and Cresencia. Gregoria died before the second world war, together with Clemente, single.
During their lifetime, the spouses acquired properties, among which was a parcel of agricultural land, of
about seven (7) hectares, located at barrio Manga, municipality of Tangub, Misamis Occidental, planted
to coconuts and fruit-bearing trees. On July 2, 1947, Ciriaco, the surviving husband and three (3) children
(Isabelo, Lourdes and Cresencia), purportedly sold the above mentioned parcel to herein defendant
Mariano T. Tiano, for P3,500.00. At the time of the sale, Cresencia was a minor, and the other child,
Josefina, did not sign the deed of sale, and did not know about the transaction.

Under date of June 20, 1957, an action for "Partition and Recovery of Real Estate, with Damages" was
filed by Josefina and Cresencia against Tiano. In the complaint, it was alleged that they were entitled to a
portion of the land, since Josefina did not sign the sale and Cresencia was a minor; that defendant Tiano
had usurped the portions belonging to them, to their damage and prejudice in the amount of P7,000.00,
which consisted of their share in the produce of the property, during the period of defendant's possession.

In Answer, defendant claimed that the plaintiffs herein knew of the sale and that he was not aware of any
defect in the title of his vendors. As a Special Defense, defendant alleged that he was the absolute owner
of the land by acquisitive prescription of ten (10) years, from the date of purchase. Before the trial, the
parties agreed to a stipulation of facts.

The trial court in the same decision, commissioned the Deputy Provincial Sheriff, to partition the property
in question and render a report within 30 days. Defendant moved for a reconsideration of the decision,
contending that prescription had already set in, and his (defendant's, title, had become irrevocable, and
that the award of damages had no factual and legal basis. The motion for reconsideration was denied on
March 5, 1960. The Commissioner's report, partitioning the property was submitted on April 11, 1960.
Defendant perfected his appeal on May 9, 1960, and on May 14, 1960, the same was given due course
and elevated to this Court.

Issue:
Whether or not prescription in favor of appellant Tiano has set in? No.

Ruling:
The established rule then, as it is the rule now, under the New Civil Code, is that the commencement of
the suit prior to the expiration of the applicable limitation period, interrupts the running of the statute, as to
all parties to the action. Since civil actions are deemed commenced from the date of the filing and
docketing of the complaint with the Clerk of Court, without taking into account the issuance and service of
summons, the contention that the period was not interrupted until after defendant received the summons
is, therefore, without legal basis.

Appellant cannot avail himself of the defense acquisitive prescription, no finding of fact having
been made by the lower court that his possession from the time of the sale was with just title, in
good faith and in the concept of an owner, public, peaceful, adverse and uninterrupted, appellant
having chosen to appeal the decision directly to this Court, without passing through the Court of
Appeals.
SUN INSURANCE OFFICE, LTD., (SIOL), E.B. PHILIPPS AND D.J. WARBY, petitioners, vs. HON.
MAXIMIANO C. ASUNCION, Presiding Judge, Branch 104, Regional Trial Court, Quezon City and
MANUEL CHUA UY PO TIONG, respondents.

1. STATUTES; PROCEDURAL LAWS; APPLIED RETROSPECTIVELY

2. REMEDIAL LAW; JURISDICTION; VESTS IN COURTS UPON PAYMENT OF THE
PRESCRIBED DOCKET FEES.
3. ID.; ID.; PERMISSIVE COUNTERCLAIMS AND THIRD-PARTY CLAIMS; NOT CONSIDERED
FILED UNLESS PRESCRIBED DOCKET FEE IS PAID.
4. ID.; ID.; PAYMENT OF ADDITIONAL FEE REQUIRED WHERE JUDGMENT AWARDS CLAIM
NOT SPECIFIED IN THE PLEADING.

Facts:
Petitioner Sun Insurance filed a complaint with the Makati RTC for the consignation of a premium refund
on a fire insurance policy with prayer for the judicial declaration of its nullity against private respondent
Manuey Uy Po Tiong. Private respondent was declared in default for failure to file the required answer
within the reglementary period.

Private respondent filed a compliant in the Quezon City RTC for the refund of premiums and the issuance
of a writ of preliminary attachment. Only the amount of P210 was paid by private respondent as docket
fee which prompted petitioner to raise objection. Upon order of the SC, the case was assigned to a
different branch due to under-assessment of docket fees.

The case was thereafter assigned to Judge Asuncion who required the parties to comment on the Clerk of
Court’s letter-report signifying her difficulty in complying with the SC Resolution since the pleadings filed
by private respondent did not indicate the exact amount sought to be recovered.

Private respondent filed a Re-Amended complaint stating therein a claim of not less than 10M as actual
compensatory damages in the prayer. However, the body of the amended complaint alleges actual and
compensatory damages and atty’s fees in the total amount of about P44,601,623.70

Judge Asuncion issued another Order admitting the second amended complaint and stating that the same
constituted proper compliance with the SC Resolution. Petitioner filed a petition for Certiorari with the CA
questioning the order of Judge Asuncion. Private respondent filed a supplemental complaint alleging an
additional claim of P20M as damages bringing the total claim to P64,601,623.70. CA denied petition and
granted writ of prelim attachment.

Issue:
Whether or not a court acquires jurisdiction over a case when the correct and proper docket fee has not
been paid.

Ruling:
Private
respondent claims that the ruling in Manchester (149 SCRA 562) cannot apply retroactively to Civil Case
No. Q-41177 for at the time said civil case was filed in court there was no such Manchester ruling as yet.
Further, private respondent avers that what is applicable is the ruling of this Court in Magaspi v.
Ramolete, wherein this Court held that the trial court acquired jurisdiction over the case even if the docket
fee paid was insufficient. The contention that Manchester cannot apply retroactively to this case is
untenable. Statutes regulating the procedure of the courts will be construed as applicable to actions
pending and undetermined at the time of their passage. Procedural laws are retrospective in that sense
and to that extent.

It is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the
prescribed docket fee, that vests a trial court with jurisdiction over the subject- matter or nature of
the action. Where the filing of the initiatory pleading is not accompanied by payment of the docket
fee, the court may allow payment of the fee within a reasonable time but in no case beyond the
applicable prescriptive or reglementary period.

The same rule applies to permissive counterclaims, third-party claims and similar pleadings, which shall
not be considered filed until and unless the filing fee prescribed
therefor is paid. The court may also allow payment of said fee within a reasonable time but also in no
case beyond its applicable prescriptive or reglementary period.

Where the trial court acquires jurisdiction over a claim by the filing of the appropriate pleading and
payment of the prescribed filing fee but, subsequently, the judgment awards a claim not specified in the
pleading, or if specified the same has been left for determination by the court, the additional filing fee
therefor shall constitute a lien on the judgment.

WHEREFORE, the petition is DISMISSED for lack of merit.

JOE HODGES, petitioner, vs. COURT OF APPEALS, HEIRS OF LEON P. GELLADA, plaintiff-
appellee in Civil Case No. 6512, ROMEO MEDIODIA, plaintiff-appellant in Civil Case No. 6513, and
HEIRS OF FERNANDO MIRASOL, plaintiff-appellee in Civil Case No. 6516, respondents.

Tivol & Tivol Law Office for petitioner.

Efrain Treñas for Romeo Mediodia.
Villa and Partners for private respondents.
Norberto Posecion for Heirs of Gellada.

1. REMEDIAL LAW; CIVIL PROCEDURE; NON-PAYMENT OF DOCKET FEE; LEGAL EFFECT

2. ID.; ID.; ID.; COURT DOES NOT ACQUIRE JURISDICTION OVER THE SUBJECT MATTER;
CASE AT BAR

Facts:
Three practicing lawyers filed separate actions for damages against petitioner for alleged defamatory
statements claiming damages in the form of moral damages, damage to their law practice, exemplary and
temperate damages. Petitioner (then defendant) questioned the jurisdiction of the courts over these cases
pointing out that the court cannot acquire jurisdiction over the case unless the corresponding docket fee is
paid.

In the present petition, in the case of Gellada vs. Hodges the total amount of the claim for damages is
about P460,000.00, the estimated docket fee due is P770.00 but what was paid only was P32.00. Despite
the order of the trial court on August 31, 1972 and another order ten years later, that is on March 11,
1982, requiring plaintiff to pay the correct docket fee, Gellada paid the amount of P168.00 Thus his total
payment amounts to just P200.00, which is still much less than the amount of P770.00 due.

Similarly in Mediodia vs. Hodges where the claim is approximately P360,000.00 and the appropriate filing
fee would be about P570.00, the plaintiff paid only P32.00 upon filing the complaint. After the two
aforesaid order of the trial court were issued, Mediodia paid on September 5, 1982 the amount of
P168.00 bringing his payment to a total of P200.00 which is also much less than the amount of P570.00
due for docket fee.

In the case of Mirasol vs. Hodges, the total claim is for P410,000.00 and the amount of filing fee due is
P670.00. Mirasol paid only P32.00 upon filing the complaint. He did not pay any additional sum even after
the two orders of the court had been issued.

Issue:
WON the trial court acquired jurisdiction over the subject matter in the given three cases due to the failure
to pay in full the prescribed docket fees.

Ruling:

As early as Lazaro vs. Endencia, [57 Phil. 552 (1932)] this Court held that an appeal is not deemed
perfected if the appellate court docket fee is not fully paid. In Lee vs. Republic, [10 SCRA 65 (1964)] this
Court ruled that a declaration of intention to be a Filipino citizen produced no legal effect until the required
filing fee is paid. In Malimit vs. Degamo, [12 SCRA 450 (1964)] We held that the date of payment of the
docket fee must be considered the real date of filing of a petition for quo warranto and not the date it was
mailed. In Magaspi vs. Ramolete, [115 SCRA 193, 204 (1982)] the well-settled rule was reiterated that a
case is deemed filed only upon payment of the docket fee regardless of the actual date of its filling in
court. At the time, therefore, that the three (3) cases subject of the herein petition were filed, the rule was
already clear that the court does not acquire jurisdiction over a case until after the prescribed docket is
paid. In Manchester Development Corporation vs. Court of Appeals (149 SCRA 562 (1987), this rule was
emphasized when this Court stated "The court acquires jurisdiction over any case only upon the payment
of the prescribed docket fee. An amendment of the complaint or similar pleading will not thereby vest
jurisdiction in the court, much less the payment of the docket fee based on the amount sought in the
amended pleading." The rule in Manchester was relaxed in Sun Insurance vs. Hon. Maximiano Asuncion,
whereby this Court declared that the trial court may allow payment of the fee within a reasonable time but
in no case beyond the applicable prescriptive or reglementary period. Nevertheless, in Sun Insurance,
this Court reiterated the rule that it is the payment of the prescribed docket fee that vests the trial Court
with jurisdiction over the subject matter or nature of the case.

In the present petition, it appears that in the case of Gellada vs. Hodges the total amount of the claim for
damages is about P460,000.00, the estimated docket fee due is P770.00 but what was paid only was
P32.00. Despite the order of the trial court on August 31, 1972 and another order ten years later, that is
on March 11, 1982, requiring plaintiff to pay the correct docket fee, Gellada paid the amount of P168.00
only. Thus his total payment amounts to just P200.00, which is still much less than the amount of P770.00
due. Similarly, in Mediodia vs. Hodges where the claim is approximately P360,000.00 and the appropriate
filing fee would be about P570.00, the plaintiff paid only P32.00 upon filing the complaint. After the two
aforesaid orders of the trial Court were issued, Mediodia paid on September 5, 1982 the amount of
P168.00 bringing his payment to a total of P200.00 which is also much less than the amount of P570.00
due for docket fee. Thus, the entire proceedings undertaken in said cases are null and void. The plaintiffs
in said cases are practicing lawyers who are expected to know this mandatory requirement in the filing of
any complaint or similar pleading. Their non-payment of the prescribed docket fee was deliberate and
inexcusable.
SPOUSES ROSALINA S. DE LEON and ALEJANDRO L. DE LEON, petitioners, vs . THE COURT OF
APPEALS, GLICERIO MA. ELAYDA II, FEDERICO ELAYDA and DANILO ELAYDA, respondents.

Robles Ricafrente and Aguirre Law Firm for petitioners.

Rilloraza Africa De Ocampo and Africa for private respondents.

1. REMEDIAL LAW; CIVIL PROCEDURE; ACTIONS; AN ACTION FOR RESCISSION OF

CONTRACT IS ONE WHICH IS NOT SUSCEPTIBLE OF PECUNIARY ESTIMATION AND
THEREFORE THE DOCKET FEE FOR ITS FILING IS THE FLAT AMOUNT OF P200.00 (NOW
P400.00) AS THEN FIXED IN THE FORMER RULE 141, SECTION 5(10) OF THE RULES OF
COURT; CASE AT BAR.

Facts:
Private respondents Elayda filed a complaint for annulment or rescission of a contract of sale of two
parcels of land against petitioners De Leon before the Regional Trial Court of Quezon City. Petitioners
􀀷led a motion to dismiss on the ground that the trial court did not acquire jurisdiction over the case
because of non-payment of the correct amount of docket fees. On October 21, 1991, the trial court denied
the motion to dismiss but required the private respondents to pay the amount of docket fees based on the
estimated value of the parcels of land in litigation as stated in the complaint. Their motion for
reconsideration having been denied, private respondents brought the matter to the Court of Appeals. On
February 26, 1992, a decision was rendered by the respondent court annulling the orders of the trial court
and holding an action for rescission or annulment of contract is not susceptible of pecuniary estimation
and, therefore, the docket fees should not be based on the value of the real property, subject matter of
the contract sought to be annulled or rescinded. Petitioners moved for reconsideration, but to no avail.
Hence, this petition for review on certiorari.

Issue:
WON is assessing the docket fees to be paid for the filing of an action for annulment or rescission of a
contract of sale, the value of the real property subject matter of the contract should be used as basis as
one which is not capable of pecuniary estimation

Ruling:
The Supreme Court ruled that where the value of the case cannot be estimated, the docket fee for its
filing should be the flat amount of P400.00 as fixed by Section 7 (b) (1), Rule 141 of the Rules of Court. In
the present case, the Court of Appeals correctly adjudged that since the action of respondents against
petitioners is solely for annulment or rescission which is not susceptible of pecuniary estimation, the
action should not be confused and equated with the value of the property. Although eventually the result
may be the recovery of land, it is the nature of the action as one for rescission of contract which is
controlling. In view thereof, the decision of the Court of Appeals is affirmed.
MANCHESTER DEVELOPMENT CORPORATION, ET AL. , petitioners, vs. COURT OF APPEALS,
CITYLAND DEVELOPMENT CORPORATION, STEPHEN ROXAS, ANDREW LUISON, GRACE
LUISON and JOSE DE MAISIP, respondents.

Tanjuatco, Oreta and Tanjuatco for petitioners.

Pecabar Law Offices for private respondents.

1. REMEDIAL LAW; CIVIL PROCEDURE; NON-PAYMENT OF DOCKET FEE; RENDERS NULL

AND VOID AND COMPLAINTS AND SUBSEQUENT PROCEEDINGS WHERETO.
2. ID.; ID.; COMPLAINT; CONTENTS; AMOUNT OF MANDAMUS MUST BE SPECIFIED NOT
ONLY IN THE BODY BUT ALSO IN THE PRAYER.

Facts:
On January 9, 1992, the City Prosecutor of the City of Roxas filed with the Regional Trial Court, 6th
Judicial Region, Branch 15, Roxas City an Information for libel. After trial, the respondent judge rendered
the assailed Decision finding three of the accused guilty and acquitting a fourth. However, “(t)he civil
indemnity by way of moral damages (was) dismissed for lack of jurisdiction” on the ground that petitioner
did not pay the filing fees therefor. Reconsideration having been denied, petitioner filed this instant
petition for review.

Issue:
WON the offended party should recover moral damages.

Ruling:
The rule is well-settled "that a case is deemed filed only upon payment of the docket fee regardless of the
actual date of filing in court." Thus, in the present case the trial court did not acquire jurisdiction over the
case by the payment of only P410.00 as docket fee. Neither can the amendment of the complaint thereby
vest jurisdiction upon the Court. For all legal purposes there is no such original complaint that was duly
filed which could be amended. Consequently, the order admitting the amended complaint and all
subsequent proceedings and actions taken by the trial court are null and void. The Court acquires
jurisdiction over any case only upon payment of the prescribed docket fee. An amendment of the
complaint or similar pleading will not thereby vest jurisdiction in the Court, much less the payment of the
docket fee based on the amounts sought in the amended pleading.

All complaints, petitions, answers and other similar pleadings should specify the amount of damages
being prayed for not only in the body of the pleading but also in the prayer, and said damages shall be
considered in the assessment of the filing fees in any case. Any pleading that fails to comply with this
requirement shall not be accepted nor admitted, or shall otherwise be expunged from the record. The
court acquires jurisdiction over any upon payment of the prescribed docket fee.
DELIA MANUEL, petitioner, vs . JUDGE DAVID ALFECHE, JR., in his capacity as then Presiding
Judge of RTC, Region Six, Branch 15, Roxas City, FELIPE CELINO, DANNY FAJARDO and
LEMUEL FERNANDEZ, respondents.

Stephen C. Arceno for petitioner.

Resurreccion S. Salvilla for private respondents.

1. REMEDIAL LAW; CIVIL PROCEDURE; PROPER REMEDY FOR PETITIONER IS NOT THE
INSTANT PETITION TO THIS COURT UNDER RULE 45 BUT AN ORDINARY APPEAL TO THE
COURT OF APPEALS; REASON.
2. ID.; CRIMINAL PROCEDURE; CIVIL LIABILITY; PETITIONER'S CONTENTION THAT THE
REVIEW OF THE CIVIL ASPECT BY THIS COURT CAN TAKE PLACE SIMULTANEOUSLY
WITH AND SEPARATELY FROM THE REVIEW OF THE CRIMINAL ASPECT BY THE COURT
OF APPEALS IS MISPLACED.
3. ID.; PETITIONER'S CONTENTION THAT PAYMENT OF FILING AND DOCKET FEES, BY
REASON OF THE NON-SPECIFICATION OF THE AMOUNTS OF MORAL AND EXEMPLARY
DAMAGES, IS NOT NECESSARY, PURPORTEDLY ON THE AUTHORITY OF GENERAL VS.
CLARAVALL , IS LIKEWISE MISPLACED; REASON.

Facts:

Issue:

Ruling:
Reconsideration having been denied, petitioner sought to overturn the above dismissal via the instant
petition for review on certiorari under Rule 45. While petitioner may be correct in asserting that a direct
petition may, under appropriate circumstance, be taken to this Court from the 􀀾nal judgment of the
Regional Trial Court on pure questions of law in the form and manner provided for in the Revised Rules of
Court, nevertheless, in view of the factual environment of this case, particularly that private respondent
herein had already taken an appeal to the Court of Appeals to question the trial court's judgment of
conviction, the proper remedy for petitioner is simply ordinary appeal to the said tribunal. This is so
because the award of moral and exemplary damages by the trial court is inextricably linked to and
necessarily dependent upon the factual finding of basis therefor, viz., the existence of the crime of libel.
Inasmuch as the very same Decision herein assailed is already pending review by the Court of Appeals,
there is a distinct possibility that said court may, if the facts and the law warrant, reverse the trial court
and acquit the accused. In such event, the appellate court's action could collide with a ruling 􀀾nding merit
in petitioner's contentions before this Court. Such a situation would lead to absurdity and confusion in the
ultimate disposition of the case. Obviously, this possibility must be avoided at all cost. This is (at least
partly) the raison d'etre for the rule against forum-shopping. Clearly, then, petitioner ought to have
brought her challenge in the Court of Appeals.

We note petitioner's vehement insistence that Art. 33 of the Civil Code allows an independent civil action
for damages in cases of defamation, fraud, and physical injuries to be instituted separately and
independently from the criminal. She then concludes that the civil aspect of the case is not dependent on
the criminal, but rather, may proceed independently thereof, and that therefore, the review of the civil
aspect by this Court may take place simultaneously with and separately from the review of the criminal
aspect by the Court of Appeals. Such reasoning is misplaced. Sec. 1 of Rule 111 provides that the civil
action for recovery of civil liability is impliedly instituted with the criminal action unless the offended party
waives the civil action, reserves his right to institute it separately, or institutes the civil action prior to the
criminal action. In the present case, the civil action had been actually (not just impliedly) instituted with the
criminal prosecution, as shown by the fact that petitioner took an active part in the prosecution of the
criminal case. As admitted in the petition, "the private prosecutor, counsel for . . . the petitioner herein"
was allowed "upon prior authority and under the supervision of the City Prosecutor, to handle the
prosecution, by presenting all the prosecution's evidence" and even filing the Prosecution's
Memorandum. Obviously then, there can no longer be any independent civil action to speak of, as the
civil aspect had previously been included in the criminal. And petitioner, by attempting to have recourse
with this Court with the criminal aspect still pending with the Court of Appeals, was effectively trying to
split a single cause of action. This we cannot allow.

Petitioner also posits the non-necessity of paying the 􀀾ling and docket fees by reason of the non-
specification of the amounts of moral and exemplary damages being claimed by her, purportedly on the
authority of this Court's ruling in General vs. Claravall. We hold that said General ruling was actually
intended to apply to a situation wherein either (i) the judgment awards a claim not specified in the
pleading, or (ii) the complainant expressly claims moral, exemplary, temperate and/or nominal damages
but has not specified ANY amount at all, leaving the quanti􀀾cation thereof entirely to the trial court's
discretion, and NOT to a situation where the litigant specifies some amounts or parameters for the awards
being sought, even though the different types of damages sought be not separately or individually
quantified. Were we to hold otherwise, the result would be to permit litigants to continue availing of one
more loophole in the rule on payment of 􀀾ling fees, and would not serve to attain the purpose of the
revised Sec. 1 of Rule 111, which is "to discourage the 'gimmick of libel complainants of using the fiscal's
office to include in the criminal information their claim for astronomical damages in multiple millions of
pesos without paying any filing fees.'
 RULE 2
CITIZENS' SURETY & INSURANCE COMPANY, INC. , petitioner, vs. HON. JUDGE A. MELENCIO-
HERRERA, SANTIAGO DACANAY, and JOSEFINA DACANAY, respondents.

Dayos, Tesoro & Gloria, Jr. for petitioner.

Respondent Judge for and in his own behalf.

1. REMEDIAL LAW; JURISDICTION; ACTION IN PERSONAM; PERSONAL SERVICE OF

SUMMONS REQUIRED.
2. CIVIL LAW; OBLIGATIONS AND CONTRACTS; CREDITORS; REMEDY AGAINST
ABSCONDING DEBTORS.

Facts:
Spouses Dacanay were indebted to Citizens’ Surety Insurance. As security, the Dacanays mortgaged a
parcel of land in Baguio. Since they were not able to pay said debt, the said lot was sold in a foreclosure
sale. However, proceeds of the sale were insufficient to satisfy said debt. Thus Citizens’ Surety filed a
complaint with the Manila CFI, seeking to recover the balance, plus 10% thereof as atty’s fees, and other
costs.

At petitioner’s request, respondent Judge caused summons to be made by publication in the Phils Herald.
But despite the publication and deposit of a prepaid copy of the complaint at the Manila Post Office,
defendants did not appear within the period of 60 days from last publication, as required by the summons.

Plaintiff then asked that defendants be declared in default; but instead, respondent Judge asked it to
show cause why the action should not be dismissed, the suit being in personam and the defendants not
having appeared. Respondent Judge dismissed the case despite plaintiff’s argument that the summons
by publication was sufficient and valid under sec16 Rule14 RRC

Ruling:
We agree with respondent Judge that the action of plaintiff petitioner, being in personam, the Court could
not validly acquire jurisdiction on a non-appearing defendant, absent a personal service of summons
within the forum. We have explicitly so ruled in Pantaleon vs. Asuncion, 105 Phil. 765, pointing out without
such personal service, any judgment on a non-appearing defendant would be violative of due process. In
the aforecited case this Court, through Justice Roberto Concepcion, now Chief Justice, ruled as
follows: . . . "It is a well-settled principle of Constitutional Law that, in an action strictly in personam, like
the one at bar, personal service of summons, within the forum, is essential to the acquisition of jurisdiction
over the person of the defendant, who does not voluntary submit himself to the authority of the court. In
other words, summons by publication cannot — consistently with the due process clause in the Bill of
Rights — confer upon the court jurisdiction over said defendants. 'Due process of law requires personal
service to support a personal judgment, and, when the proceeding is strictly in personam brought to
determine the personal rights and obligations of the parties, personal service within the state or a
voluntary appearance in the case is essential to the acquisition of jurisdiction so as to constitute
compliance with the constitutional requirement of due process. . . . 'Although a state legislature has more
control over the form of service on its own residents than nonresidents, it has been held that in actions in
personam . . . service by publication on resident defendants who are personally within the state and can
be found therein is not "due process of law," and statute allowing it is unconstitutional.' (16A C.J.S., pp.
786, 789; Emphasis our)"

The proper recourse for a creditor in the same situation as petitioner is to locate properties, real or
personal, of the resident defendant debtor with unknown address and cause them to be attached under
Rule 57, Sec. 1(f), in which case, the enactment converts the action into a proceeding in rem or quasi in
rem and the summons by publication may then accordingly be deemed valid and effective But because
debtors who abscond and conceal themselves are also quite adept at concealing their properties, the
dismissal of the case below by respondent Judge should be set aside and the case held pending in the
court's archives, until petitioner as plaintiff succeed in determining the whereabouts of the defendants'
person or properties and causes valid summons to be served personally or by publication as the case
may be. In this manner, the tolling of the period of prescription for as long as the debtor remains in hiding
would properly be a matter of court record, and he can not emerge after a su􀁉cient lapse of time from the
dismissal of the case to profit from his own misdeed and claim prescription of his just debt.
BACHRACH MOTOR CO., INC., plaintiff-appellant, vs . ESTEBAN ICARAÑGAL and ORIENTAL
COMMERCIAL CO., INC. , defendantsappellees.

B. Francisco for appellant.

Matias P. Perez for appellees.

1. ID.; ID.; ID.; PRINCIPLE FOLLOWED IN ORDINARY ACTIONS.

2. ID.; ID.; ID.; RULE AGAINST SPLITTING A SINGLE CAUSE OF ACTION.

Facts:
Defendant Icarañgal, with one Jacinto Figueroa, for value received, executed in favor of the plaintiff,
Bachrach Motor Co., Inc., a promissory note for one thousand six hundred fourteen pesos (P1,614), and
in security for its payment, executed a real estate mortgage on a parcel of land in Pañgil, Laguna.
Thereafter, defendant defaulted in the payment of the agreed monthly installments; wherefore, plaintiff
instituted in the Court of First Instance of Manila an action for the collection of the amount due on
the note.

Judgment was there rendered for the plaintiff BACHRACH MOTOR.

The other defendant herein, Oriental Commercial Co., Inc., interposed a third-party claim, alleging that
by virtue of a writ of execution issued in civil case No. 88253 of the municipal court of the City of Manila,
the property which was the subject of the mortgage and which has been levied upon by the
sheriff, had already been acquired by it at the public auction on May 12, 1933.

By reason of this third-party claim, the sheriff desisted from the sale of the property and, in consequence
thereof, the judgment rendered in favor of the plaintiff remained unsatisfied. Whereupon, plaintiff
instituted an action to foreclose the mortgage. The trial court dismissed the complaint and, from the
judgment thus rendered plaintiff took the present appeal.

Issue:
WON plaintiff-appellant is barred from foreclosing the real estate mortgage after it has elected to sue and
obtain a personal judgment against the defendant-appellee on the promissory note for the payment of
which the mortgage was constituted as a security.

Ruling:
Most of the provisions of the Code of Civil Procedure are taken from that of California, and In that
jurisdiction the rule has always been, and still is, that a party who sues and obtains a personal judgment
against a defendant upon a note, waives thereby his right to foreclose the mortgage securing it.

It is true that this rule is founded on express statutory provisions to that effect. In this jurisdiction, section
708 of the Code of Civil Procedure provides that a creditor holding a claim against the deceased, secured
by a mortgage or other collateral security, has to elect between enforcing such security or abandoning it
by presenting his claim before the committee and share in the general assets of the estate. Under this
provision, it has been uniformly held by this court that, if the plaintiff elects one of the two remedies thus
provided, he waives the other, and if he fails, he fails utterly.

There is indeed no valid reason for not following the same principle of procedure in ordinary civil actions.
With the substitution of the administrator or executor in place of the deceased, or of the assignee or
receiver in place of the insolvent debtor, the position of the parties plaintiff and' defendant in the litigation
is exactly the same in special or insolvency proceedings as in ordinary civil actions.

Even if section 708 of the Code of Civil Procedure, or section 59 of the Insolvency Law were not in the
attitude books, there is still the rule against splitting a single cause of action. This rule, though not
contained in duly statutory provision, has been applied by this court in all appropriate cases. The rule
against splitting a single cause of action is intended "to prevent repeated litigation between the same
parties in regard to the same subject of controversy; to protect defendant from unnecessary vexation; and
to avoid the costs and expenses incident to numerous suits." (1 C. J., 1107.) It comes from that old
maximum nemo debet bis vexare pro una et eadem causa (no man shall be twice vexed for one and the
same cause). And it developed, certainly not as an original legal right of the defendant, but as an
interposition of courts upon principles of public policy to prevent inconvenience and hardship incident to
repeated and unnecessary litigations. (1 C. J., 1107.)

It comes from that old maxim  nemo bedet bis vexare pro una et eadem cause (no man shall be twice
vexed for one and the same cause.

For non-payment of a note secured by mortgage, the creditor has a single cause of action against the
debtor. This single cause of action consists in the recovery of the credit with execution of the security. In
other words, the creditor in his action may make two demands, the payment of the debt and the
foreclosure of his mortgage. But both demands arise from the same cause, the nonpayment of the debt,
and, for that reason, they constitute a single cause of action.

Though the debt and the mortgage constitute separate agreements, the latter is subsidiary to the former,
and both refer to one and the same obligation. Consequently, there exists only one cause of action for a
single breach of that obligation. Plaintiff, then, by applying the rule above stated, cannot split up his single
cause of action by filing a complaint for payment of the debt, and thereafter another complaint for
foreclosure of the mortgage. If he does so, the filing of the first complaint will bar the subsequent
complaint.

BY allowing the creditor to file two separate complaints simultaneously or successively, one to recover his
credit and another to foreclose his mortgage, the court would in effect, be authorizing him plural redress
for a single breach of contract at so much cost to the courts and with so much vexation and oppression to
the debtor. In the absence of express statutory provisions, a mortgage creditor may institute against the
mortgage debtor either a personal action for debt or a real action to foreclose the mortgage.

A rule that would authorize the plaintiff to bring a personal action against the debtor and simultaneously or
successively another action against the mortgaged property, would result not only in multiplicity of suits so
offensive to justice, but also in subjecting the defendant to the vexation of being sued in the place of his
residence or of the residence of the plaintiff, and then again in the place where the property lies.

The creditor's cause of action is not only single but indivisible, although the agreements of the parties,
evidenced by the note and the deed of mortgage, may give rise to different remedies. (Frost vs. Witter,
132 Cal., 421.) The cause of action should not be confused with the remedy created for its enforcement.
And considering, that one of the two remedies available to the creditor is as complete as the other, he
cannot be allowed to pursue both in violation of those principles of procedure intended to secure simple,
speedy, and unexpensive administration of justice.
INDUSTRIAL FINANCE CORPORATION , petitioner, vs. HON. SERGIO A. F. APOSTOL, Judge of
the Court of First Instance of Rizal, Branch XVI, Quezon City, JUAN DELMENDO and HONORATA
DELMENDO and JOAQUIN PADILLA and SOCORRO PADILLA, respondents.

Santos S. Carlos for petitioner.

Elizardo Delmendo for private respondents.

1. CIVIL LAW; CREDIT TRANSACTIONS; MORTGAGE; REAL ESTATE; REMEDY OF

MORTGAGE CREDITOR; ACTION TO RECOVER BARS FURTHER REMEDY
2. ID.; ID.; ID.; ID.; ID.; CASE AT BAR.

Facts:
Spouses Padilla bought on credit 3 units of Isuzu trucks from Industrial Transport & Equipment. They
executed a prom note for the balance of the purchase price. This was secured by a chattel mortgage of
said trucks and, as additional collateral, a real estate mortgage on their land.

The Padillas failed to pay several installments on the prom note, the assignee Industrial Finance Corp.
(IFC) sued them in the CFI for the recovery of the unpaid balance including attys fees. CFI ruled on
16Apr75 in favor of IFC. On appeal, CA sustained the CFI’s ruling except for modification of attys fees
from 25% to 12% of the balance.

Meanwhile on 09Sep71 private respondents Juan and Honorata Delmendo filed a complaint against IFC,
as principal party, and the Padillas, as formal parties, in respondent CFI. The Delmendos alleged that
they were the transferees of the real property which was mortgaged earlier by the Padillas to Ind’l
Transport. The Delmendos prayed for the cancellation of the mortgaged lien annotated of the TCT and
the delivery to them by petitioner of the owner’s copy of said title with damages and attys fees,
considering that IFC waived its rights over the mortgage when it instituted a personal action against the
Padillas for collection of sum of money.

IFC moved for the dismissal of the complaint, contending that is has not waived its right over the
mortgage lien. The Delmendos filed a motion for summay judgment which the CFI granted. CFI ruled in
favor of the Delmendos. IFC filed a MfR which was denied. Hence this petition.

Ruling:
A mortgage creditor may elect to waive his security and instead bring an ordinary action to collect with the
right to execute on all the properties of the debtor, including the subject-matter of the mortgage. If he fails
in the collection suit, he can not thereafter foreclose on the mortgage.
Escolin: In case of splitting of a single cause of action, the ground for dismissal is res judicata.
Escolin: If there is one cause of action but two remedies, the plaintiff should have pleaded alternative
remedies in his complaint

In Manila Trading and Supply Co. v. Co Kim and So Tek , we declared: "The rule is now settled that a
mortgage creditor may elect to waive his security and bring, instead, an ordinary action to recover the
indebtedness with the right to execute a judgment thereon on all the properties of the debtor, including the
subject-matter of the mortgage, subject to the qualification that if he fails in the remedy by him elected, he
cannot pursue further the remedy he has waived."

By instituting Civil Case No. Q-14417 in the Court of First Instance of Rizal (Quezon City) to recover the
unpaid balance on the promissory note from the Padilla spouses and by subsequently obtaining a
judgment in its favor, petitioner IFC is considered to have abandoned its mortgage lien on the subject
property covered by Transfer Certificate of Title No. T-133625. The end result is the discharge of the real
estate mortgage and the Delmendos, having purchased the mortgaged property, automatically step into
the shoes of the original mortgagors with every right to have the title delivered to them free from said
encumbrance.
Agustin v. Bacalan, 135 SCRA 340 (1985) (old digest)

Facts:
Administrator of estate-lessor files a case for ejectment before the City Courts against the lessee. Lessee
files counterclaim in excess of the City Court’s jurisdiction. City Court decides for plaintiff. On appeal, CFI
rules for defendant and grants him damages. This became final. Plaintiff files separate for nullifying the
CFI decision on the ground that the damages awarded was beyond the jurisdiction of the City Court.

Ruling: A counterclaim not presented in the lower court can not be entertained on appeal. Defendant is
deemed to have waived his counterclaim in excess of the City Court’s jurisdiction. It is as though it has
never been brought before City Court. It may not be entertained on appeal. The amount of judgment,
therefore, obtained by the defendant-appellee on appeal, cannot exceed the jurisdiction of the court in
which the action began. Since the trial court did not acquire jurisdiction over the defendant's counterclaim
in excess of the jurisdictional amount, the appellate court, likewise, acquired no jurisdiction over the same
by its decisions or otherwise. When court transcends the limits prescribed for it by law and assumes to act
where it has no jurisdiction, its adjudications will be utterly void and of no effect either as an estoppel or
otherwise. The excess award of the CFI is therefore null and void. Action to declare nullity of award is
proper. The award not in excess stands.

The defendant's counterclaim for damages is GRANTED to the extent of TEN THOUSAND
(P10,000.00) PESOS. The grant of SIX THOUSAND (P6,000.00) PESOS in excess of such amount is
hereby declared NULL and VOID, for having been awarded beyond the jurisdiction of the court.
Escolin: A compulsory counterclaim beyond the jurisdiction of the court can be filed as a separate action.
PROGRESSIVE DEVELOPMENT CORPORATION, INC. , petitioner, vs . COURT OF APPEALS and
WESTIN SEAFOOD MARKET, INC. , respondents.

Angara Abello Concepcion Regala for petitioner

Tomas Carmelo T. Araneta for private respondent.

1. REMEDIAL LAW; SPECIAL CIVIL ACTION; CERTIORARI; MOTION FOR RECONSIDERATION

MUST BE FILED BEFORE RESORTING THERETO; EXCEPTIONS.
2. ID.; ID.; FORCIBLE ENTRY OR UNLAWFUL DETAINER; NO CLAIM FOR DAMAGES ARISING
THERETO MAY BE FILED SEPARATELY AND INDEPENDENTLY OF CLAIM FOR
RESTORATION OF POSSESSION.
3. ID.; CIVIL PROCEDURE; RES JUDICATA ; REQUISITES.
4. ID.; ID.; CAUSE OF ACTION; CIRCUMSTANCES OBTAINING IN CASE AT BAR AROSE FROM
ONLY ONE CAUSE OF ACTION.
5. ID.; ID.; MULTIPLICITY OF SUITS; CASE AT BAR RUNS COUNTER THERETO.
6. ID.; ID.; SPLITTING A SINGLE CAUSE OF ACTION; PURPOSE IS TO PROTECT DEFENDANT
FROM UNNECESSARY VEXATION.
7. ID.; ID.; FORUM SHOPPING COMMITTED IN CASE AT BAR.

Facts:
Private respondent, Westin Seafood Market, Inc., failed to pay its rentals amounting
to P8,608,284.66. Admittedly, non-payment of rentals constituted breach of their contract; thus, pursuant
to the express authority granted petitioner under the lease agreement, petitioner repossessed the leased
premises. This prompted private respondent to file a complaint against petitioner for forcible entry with
damages before the MTC of Quezon City. This case was still pending before the MTC when private
respondent instituted before the RTC of Quezon City another action for damages against petitioner, which
the latter moved to dismiss on the ground of litis pendencia and forum shopping to no avail. The same
fate awaited petitioner before the Court of Appeals which dismissed his special civil action for certiorari
and prohibition due to the failure of petitioner to file a motion for reconsideration of the RTC order. Hence,
petitioner found its way to the Supreme Court on petition for review on certiorari.

Ruling:
The Supreme Court found merit to the petition. The Court held that while generally a motion for
reconsideration must first be filed before resorting to certiorari in order to give the lower court an
opportunity to correct the errors imputed to it, this rule admits of exceptions and is not intended to be
applied without considering the circumstances of the case. The filing of the motion for reconsideration
before availing of the remedy of certiorari is not sine qua non when the issue raised is one purely of law,
or where the error is patent or the disputed order is void, or the questions raised on certiorari are those
already squarely presented to and passed upon by the lower court. In its motion for dismissal of the action
for damages with the RTC, petitioner raised the ground that another action for forcible entry was pending
at the METC between the same parties involving the same matter and cause of action. Outrightly rejected
by the RTC, the same issue was elevated by petitioner on certiorari before the Court of Appeals. Clearly,
under the prevailing circumstance, any motion for reconsideration of the trial court would have been a
pointless exercise.

The highest Court also directed the RTC of Quezon City to dismiss the complaint for damages filed before
it by private respondent on the ground of forum shopping and for unduly splitting a single cause of action
which run counter to the rule against multiplicity of suits.
ADELFO MACEDA, petitioner, vs. HON. COURT OF APPEALS AND CEMENT CENTER, INC.,
respondents.

Charles S. Anastacio for petitioner.

F.M. Carpio & Associates for private respondent.

1. REMEDIAL LAW; JURISDICTION; METROPOLITAN TRIAL COURTS; SECTION 33 B.P. BLG.

129; COUNTERCLAIM IN THE MUNICIPAL OR CITY COURT BEYOND JURISDICTIONAL
LIMIT MAYBE PLEADED ONLY BY WAY OF DEFENSE.
2. CIVIL LAW; CONTRACTS; LEASE; NO MERE LESSEE CAN CLAIM TO BE A POSSESSOR IN
GOOD FAITH.
3. ID.; ID.; ID.; MERE PROMISE NOT RECORDED ON TITLE DOES NOT ENCUMBER
PROPERTY; CASE AT BAR.
4. ID.; ID.; ID.; B.P. BLG. 877; GROUNDS FOR JUDICIAL EJECTMENT.

Facts:
A leased property originally belonged to the spouses Monserrat, a maternal aunt of the petiton. After the
spouses emigrated to the US they leased their house and lot in San Juan to the petitioner. As the house
was old and run down, petitioner proposed to have it repaired and renovated subject to reimbursement of
expenses but maceda introduced more improvements. Atty Zapata informed the petitioner that the
properly has been sold to pablo Zubiri . He was asked to vacate it. Maceda insisted on being reimbursed
for his improvements. An ejectment suit was filed against Maceda in the MTC of san juan metro manila. In
his answer to complaint, amceda set up a counterclaim for the value of improvements. The MTC ordered
him to vacate the premises and pay the plaintiff P2000 per month as compensation. Both parties
appealed to the RTC, which set aside the inferior courts decision. It dismissed the ejectment complaint
and ordered to pay Maceda P182, 000 for his necessary and useful improvements. The CA rendered a
decision, modifying the decision. The CA denied Maceda's claim for reimbursement of the cost of his
improvements. It ruled that the MTC lacked jurisdiction over the claim which exceeds P20,000. In his
petition for review of that decision, Maceda assails the setting aside of the money judgment or award for
his improvements.

Issue:
WON the lower court erred in holding that the new owners need of the premises is a legitimate ground for
the judicial ejectment of the lessee.

Ruling:
The jurisdiction of the Metropolitan Trial Court in a civil action for sum of money is limited to a demand
that "does not exceed twenty thousand pesos exclusive of interest and costs but inclusive of damages of
whatever kind." (Sec. 33, subpart. 1, B.P. Blg. 129.) A counterclaim limit may be pleaded only by way of
defense to waken the plaintiff's claim, but not to obtain affirmative relief. (Agustin vs. Bacalan, 135 SCRA
340).

Maceda was not a possessor in good faith, i.e., one who possesses in concept of an owner, hence, he
had no right to retain possession of the leased premises pending reimbursement of his improvements
thereon. No more lessee can claim to be a possessor in good faith. (Art. 546, Civil Code; Eusebio vs. IAC,
144 SCRA 154; Laureano vs. Adil, 72 SCRA 148.)

Since the undertaking of the Victorias to reimburse Maceda for the P40,000 worth of improvements which
he introduced on their property was not recorded on their title, that promise not encumber the property nor
bind the purchaser thereof or the successor-in-interest of the Victorias (Mun. of Victorias vs. Ca, 149
SCRA 32).

While it is true under B.P. Blg. 877 a lessee may not be ejected on account of the sale or
mortgage of the leased premises, the new owner's need of the premises for the construction of dwellings
for its employees, coupled with the lessee's failure to pay the rentals since December 1981, are, to our
mind, a legitimate ground for the judicial ejectment of the lessee.
JUAN BAYANG , petitioner, vs. HON. COURT OF APPEALS and BENIGNO BIONG, respondents.

Rodrigo Matutina for petitioner.

Luceniano E. Lancin for private respondent.

1. REMEDIAL LAW; CIVIL PROCEDURE; SUMMARY JUDGMENT; PROPER WHERE NO SERIOUS

CONTROVERSY EXISTS; CASE AT BAR.
2. ID.; ID.; RES JUDICATA ; ELEMENTS.
3. ID.; ID.; ID.; ID.; CASE AT BAR.

Facts:
Bayang sued Biong for Quieting of Title with damages in 1969, which resulted in a ruling in his favor in
1978. In 1978, Bayang sued Biong again but this time for the income earned from the land while it was
still in the latter’s possession from 1970 to 1978.

Issue:
WON the second case is barred by the first.

Ruling:
The subject matter in the two cases are essentially the same as the income is only a consequence or
accessory of the disputed property. The claim for income from the land is incidental to, and should have
been raised by Bayang in his earlier claim for ownership of the land. As the filing of the two cases
constitute splitting of the cause of action, the second case is barred by the first. Also, for about seven
years, the petitioner made no move at all to amend his complaint to include a claim for the income
supposedly received by private respondent during that period. He did not make the proper claim at the
proper time and in the proper proceeding. Whatever right he might have had is now deemed waived
because of his negligence.

In its decision, the Court of Appeals quoted the following excerpt from Singleton vs. Philippine Trust Co.
on the nature and functions of the summary judgment: "Summary judgment is one of the methods
sanctioned in the present Rules of Court for a prompt disposition of civil actions wherein there exists no
serious controversy. The procedure may be availed of not only by claimants, but also by defending parties
who may be the object of unfounded claims. A motion for summary judgment assumes that scrutinizing of
the facts will disclose that the issues presented by the pleadings need not be tried because they are so
patently unsubstantial as not to be genuine issues, or that there is no genuine issue to any material facts
or where the facts appear undisputed and certain from the pleadings, depositions, admissions and
affidavits." We hold that there was no genuine or triable issue of fact raised by the parties, in view
particularly of the affirmative defense of res judicata invoked by the private respondent. That defense is
sustained.

A long line of decisions has consistently held that for res judicata to apply: a) the former judgment must
be final; b) it must have been rendered by a court having jurisdiction over the subject matter and the
parties; c) it must be a judgment on the merits; and d) there must be between the first case and second
case identity of parties, identity of subject matter and identity of cause of action.

The decision in Civil Case No. 1892 became final and executory on February 2, 1978. There is no dispute
that the trial court which rendered that decision had jurisdiction over the subject-matter and the parties to
the proceeding. The case was tried on the merits. The parties to Civil Case No. 1892 and the subsequent
Civil Case No. 2589 are the same petitioner and private respondent now before us. The petitioner would
draw a distinction between the land in dispute in Civil Case No. 1892 and the income from that land being
claimed in Civil Case No. 2589. But that is in our view splitting hairs to split a cause of action. The subject
matter is essentially the same in both cases as the income is only a consequence or accessory of the
disputed property. Clearly, then, Civil Case No. 2589 is barred by the previous judgment in Civil Case No.
1892. This being so, it should follow that the trial judge committed no grave abuse of discretion in
deciding the latter case by summary judgment.