[ G.R. No.

250295, March 15, 2021 ] when tested were found to be Methamphetamine Hydrochloride, popularly known as
"shabu," a dangerous drug, in violation of the above cited law.
PEOPLE OF THE PHILIPPINES, PETITIONER, VS. NACI BORRAS Y LASCANO,
RESPONDENT. ACTS CONTRARY TO LAW.

DECISION On arraignment, private respondent pleaded not guilty to both charges. Trial ensued.

LAZARO-JAVIER, J.: Meantime, on August 15, 2017, the Court promulgated Estipona v. Lobrigo3 declaring

The Case
Petitioner People of the Philippines, through the Office of the Solicitor General (OSG),
assails the Decision1 dated October 28, 2019 of the Court of Appeals in CA-G.R. SP
No. 159780 entitled "People of the Philippines v. Hon. Soliman M. Santos, Jr., in his
capacity as Presiding Judge of RTC Branch 61, Naga City and Naci Borras y
Lascano" upholding private respondent Naci Borras y Lascano's plea bargain sans
the prosecutor's conformity.
as unconstitutional Section 234 of RA 9165 for being contrary to the Supreme Court's
rule-making authority under Section 5 (5),5 Article VIII of the 1987 Constitution.
Section 23 prohibits a person charged under RA 9165 to avail of plea bargaining.
Thereafter, the Department of Justice (DOJ) issued Department Circular No. 061-17
or the "Guidelines on Plea Bargaining Agreement for RA 9165 Otherwise Known as
the 'Comprehensive Dangerous Drugs Act of 2000"' dated November 21, 2017,6 viz.:
Offense charged in Information Acceptable Plea Bargain

Antecedents Section Penalty Section Penalty

Section 5 Life No Plea Bargain

By Informations2 dated March 10, 2017, private respondent was charged with
Sale, Trading, Imprisonment to Allowed
violations of Sections 5 and 11, Article II of Republic Act No. 9165 (RA 9165), as
etc. of Death & Fine
amended by Republic Act No. 10640 (RA 10640), viz.:
Dangerous from Php500k to
Drugs Php10M
Criminal Case No. 2017-0358
Section 11, par. 12 yrs. & 1 day Sec. 15 6 mos. Rehab
That on March 10, 2017, in the City of Naga, Philippines, and within the jurisdiction of 3 to 20 yrs. and Use of (1st Offense)
this Honorable Court, the above-named accused, [did] [then] and there, willfully, Possession of Fine from Dangerous 6 yrs. & 1 day to
unlawfully and criminally sell, dispense, and deliver one (1) small heat-sealed Dangerous Php300k to Drugs 12 yrs. & fine
transparent plastic sachet, containing white crystalline substance weighing 0.032 Drugs Php400k from Php50k to
gram, later marked as RCP3-10-17, to poseur buyer PO2 Randy C. Pitallano, which (Where quantity Php200k (for 2nd
when tested was found positive for the presence of Methamphetamine Hydrochloride of "shabu", offense)
popularly known as "shabu," a dangerous drug, in violation of the above cited law. opium,
morphine,
heroin, cocaine
ACTS CONTRARY TO LAW. is less than 5
grams, etc.)
Criminal Case No. 2014-0359

Following Estipona, on April 12, 2018, the Court promulgated A.M. No. 18-03-16-
That on March 10, 2017, in the City of Naga, Philippines, and within the jurisdiction of
SC,7 adopting the plea bargaining framework in drugs cases, viz.:
this Honorable Court, the above-named accused, without authority of law, [did] then
and there, willfully, unlawfully and criminally have in his possession, custody and
control three (3) heat-sealed & masking tape-sealed transparent plastic sachets, Offense Charged Acceptable Plea Bargain
containing white crystalline substances, described and later marked as: 1) RCP-1 3-
10-17 weighing 0.1116 gram, 2) RCP-4 3-10-17 weighing 0.037 gram and 3) RCP-3 Section Penalty Quantity Section Penalty8
3-10-17 weighing 0.012 gram; with aggregate weight of 0.165 [gram]. Said items

1
 Section 11, par. 12 years & .01 gram to Section 12. 6 months Offense charged in the Information Acceptable Plea Bargain
3. 1 day to 20 4.99 grams Possessio and 1 day
Possession of years and n of to 4 years Section Penalty Section Penalty
Dangerous fine ranging Equipment and a fine
Drugs from , ranging Section 5 Sale, Life Section 11, par. 12 yrs. & 1 day
(Where quantity Php300,000 Instrument, from Trading, etc. of Imprisonment to 3 Possession of to 20 yrs. and
of shabu, to Apparatus Php10,000 Dangerous Death & Fine Dangerous Fine from
opium, Php400,000 and Other to Drugs from Php500k to Drugs (Plea Php300k to
morphine, Paraphern Php50,000 Php10M bargaining is Php400k
heroin, cocaine alia for 9 allowed only if
is less than 5 Dangerous the drugs
grams) Drugs involved are
"shabu" and/or
Section 5. Life .01 gram to .99 Section 6 months marijuana and
Sale, Trading, Imprisonme grams 12.  and 1 day the quantity
etc. of nt to Death (methampheta Possessio to 4 years of "shabu" is less
Dangerous and fine mine n of and a fine than 5 grams
Drugs ranging hydrochloride Equipment ranging and the quantity
(Methampheta from or shabu only) , from of marijuana is
mine Php500,000 Instrument, Php10,000 less than 300
hydrochloride to Apparatus to grams)
or shabu only) Php10,000, and Other Php50,000 
000 Paraphern 10 Section 11, par. 12 yrs. & 1 day Section 12 6 months & 1
alia for 3 Possession of to 20 yrs. and Possession of day to 4 years
Dangerous Dangerous Fine from Equipment, and a Fine
Drugs Drugs (Where Php300k to Apparatus & Ranging from
quantity of Php400k Other Php10k to
"shabu", opium, Paraphernalia for Php50k
On May 17, 2018, the DOJ issued Regional Prosecution Office Order No. 027-E- morphine, Dangerous
1811 reiterating Department Circular No. 061-17. heroin, cocaine, Drugs
et al. is less than
5 grams;
While petitioner was presenting its evidence on May 28, 2018, private respondent
marijuana is less
filed a plea bargaining proposal12 to withdraw his earlier plea of not guilty in order to
than 300 grams)
plead guilty to two (2) counts of Illegal Possession of Drug paraphernalia under
Section 12 of RA 9165, as amended by RA 10640.
The Trial Court's Ruling
Petitioner objected on ground that DOJ Circular No. 061-17,13 the prevailing circular
at that time, proscribed plea bargaining for the crime of Illegal Sale of Dangerous By Resolution14 dated July 20, 2018, the trial court granted private respondent's plea
Drugs under Section 5 of RA 9165, as amended by RA 10640. The same circular bargaining proposal and ordered his re-arraignment despite petitioner's objection,
decreed that plea bargaining should be done before the prosecution commenced its thus:
presentation of evidence. Meanwhile, violation of Section 11 of the same law may be
the subject of plea bargaining to the lesser offense of illegal use of dangerous drugs.
WHEREFORE, premises considered, Department of Justice (DOJ) Circular No. 061
dated [November] 21, 2017, DOJ Circular No. 027 dated June 26,2018 and Regional
Subsequently, on June 26, 2018, the DOJ issued Department Circular No. 027-18 or Prosecution Office (RPO) Order No. 027-E-18 dated May 17, 2018 are hereby
the "Amended Guidelines on Plea Bargaining for Republic Act No. 9165, otherwise DECLARED UNCONSTITUTIONAL AND INVALID for being in contravention to or
known as the 'Comprehensive Dangerous Drugs Act of 2000'" amending Department undermining the rule-making power of the SC, its Estipona Decision, its A.M. No. 18-
Circular No. 061-17 dated November 21, 2017. According to this department circular, 03-16-SC Resolution (Adopting the Plea Bargaining Framework in Drug Cases), and
private respondent may only plead guilty to a lesser offense, as follows: the equal protection clause in their (the said DOJ issuances) application if not in their

2
design. The defense Proposal for Plea Bargaining is ALLOWED over the "vigorous"
objection of the prosecution. RE-ARRAIGN the accused in accordance therewith at
the next scheduled hearing (on July 23).15
Too, the trial court motu proprio declared as unconstitutional DOJ Circular Nos. 061-
17 and 027-18, and RPO Order No. 027-E-18 (DOJ Issuances) on the following
grounds:
First. These issuances were contrary to the landmark case of Estipona and A.M. No.
18-03-16-SC;
Second. The same effectively blocked the otherwise allowable plea bargains in
numerous Section 5 cases involving miniscule amounts of dangerous drugs;
Third. They encroach on the Supreme Court's rule-making power under Article VIII,
Section 5(5)16 of the 1987 Constitution; and
Fourth. They undermine the state policy behind RA 9165 to balance repression and
punishment on the one hand, with treatment, rehabilitation, and reintegration on the
other.
According to the trial court, since the opposition to private respondent's plea
bargaining proposal was based on the DOJ issuances that had already been declared
unconstitutional, there was no more need to require the prosecutor's consent thereto.
Petitioner's subsequent motion for reconsideration17 was denied under
Resolution18 dated August 25, 2018.
Meantime, on July 23, 2018, private respondent was re-arraigned, during which he
pleaded guilty to two (2) counts of Illegal Possession of Drug Paraphernalia under
Section 1219 of RA 9165, as amended by RA 10640.20
Thereafter, the trial court rendered a verdict of conviction per Judgment21 dated
August 31, 2018, viz.:
WHEREFORE, premises considered, judgment is hereby rendered FINDING the
accused NACI BORRAS y LASCANO GUILTY beyond reasonable doubt:
[a] In Crim. Case No. 0358 as principal in the special offense of violation of R.A. 9165,
Sec. 12 and is SENTENCED to an indeterminate prison term of THREE (3)
YEARS as minimum to FOUR (4) years as maximum, and a FINE of THIRTY
THOUSAND PESOS (P30,000.00); and
[b] In Crim. Case No. 0359 as principal in the special offense of violation of R.A. 9165,
Sec. 12 and is SENTENCED to an indeterminate prison term of TWO (2) years as
3
minimum to THREE (3) YEARS as maximum, and a FINE of TWENTY THOUSAND
PESOS (P20,000.00).22
Proceedings before the Court of Appeals
On certiorari,23 petitioner charged the trial court with Grave Abuse of Discretion when
it granted private respondent's proposal to plead guilty to lesser offenses over the
prosecution's vigorous objection. It insisted that the prosecutor's consent in plea
bargaining was a condition precedent to a valid plea of guilt to a lesser offense. Too,
the trial court gravely abused its discretion when it unilaterally voided the relevant
DOJ issuances.
In his comment,24 private respondent supported the trial court's dispositions. He
countered that the trial court was authorized to overrule the prosecution's objections
to a plea bargaining. At any rate, the trial court did not gravely abuse its discretion
when it declared the relevant DOJ issuances as unconstitutional. For one, the validity
of these DOJ issuances was already ripe for adjudication. For another, the trial court
had locus standi to pass upon the validity of the DOJ issuances because the same
were of transcendental significance.
The Ruling of the Court of Appeals
Through its assailed Decision25 dated October 28, 2019, the Court of Appeals
affirmed, with modification, viz.:
WHEREFORE, premises considered, the instant petition for certiorari is
hereby DENIED. The Judgment dated August 31, 2018 of the Regional Trial Court
(RTC), Branch 61, Naga City finding private respondent Naci Borras y Lascano guilty
of two (2) counts of violation of Section 12, Article II of RA No. 9165 and sentencing
him to suffer an indeterminate prison term of three (3) years, as minimum, to four (4)
years, as maximum, and a fine of P30,000.00 for the first count of illegal possession
of drug paraphernalia; and, two (2) years, as minimum, to three (3) years, as
maximum, and a fine of P20,000.00 for the second count,
is AFFIRMED with MODIFICATION in that the portions of the Plea Bargaining
Resolutions dated July 20, 2018 and August 25, 2018, respectively, which declared
as unconstitutional the Department of Justice (DOJ) Circular Nos. 061 and 027
are DELETED.
SO ORDERED.26
Citing the Resolution dated April 2, 2019 in Re: Letter of Associate Justice Diosdado
M. Peralta on the Suggested Plea Bargaining Framework Submitted by the Philippine
Judges Association, the Court of Appeals held that judges may allow plea bargaining
even over the prosecution's objection where the sole ground for the objection was
that it would weaken the government's campaign against illegal drugs. According to
the Court of Appeals, petitioner failed to allege, much less, prove that private
respondent was a recidivist, habitual offender, or known in the community as a drug
addict and a troublemaker. There was also no showing that private respondent had
undergone rehabilitation. There was no reason, therefore, to deny respondent's plea
bargain. At any rate, the consent of the prosecutor is not required at all times.
The Court of Appeals, however, found that the trial court committed Grave Abuse of
Discretion when it motu proprio passed upon the constitutionality of the relevant DOJ
issuances. For the issue of whether to grant the plea bargaining may be resolved by
simply applying A.M. No. 18-03-16-SC. Consequently, it deleted from the trial court's
ruling the pronouncement declaring the DOJ issuances unconstitutional.
The Present Petition
Petitioner27 now seeks affirmative relief from the Court. It insists that the prosecutor's
consent must be secured before an accused can validly plead guilty to a lesser
offense. Meanwhile, it was error for the Court of Appeals to have relied on this Court's
Resolution dated April 2, 2019 in Re: Letter of Associate Justice Diosdado M. Peralta
on the Suggested Plea Bargaining Framework Submitted by the Philippine Judges
Association in support of the trial court's action which overruled the prosecution's
objection to private respondent's plea bargaining proposal. For one, the resolution
cannot be applied retroactively to private respondent whose original plea was entered
way back in 2018. For another, the resolution does not at all totally dispense with the
prosecutor's consent.
In his comment,28 private respondent defends the Court of Appeals' dispositions. He
counters that neither the consent of the prosecutor nor the consent of the offended
party is indispensable to the validity of a plea to a lesser offense. A contrary position
would be tantamount to a surrender of the court's sole and supreme authority to
command the course of a case. Under A.M. No. 18-03-16-SC, judges may allow plea
bargaining even over the prosecution's objection. Since he was allowed to bargain
under A.M. No. 18-03-16-SC, the prosecution had no basis to oppose it.
Issue
Is the consent of the prosecutor indispensable to a valid plea bargain in drugs cases?
Our Ruling
The petition is meritorious.
Plea bargaining in criminal cases is a process where the accused and the prosecution
work out a mutually satisfactory disposition of the case subject to court approval. It
usually involves the defendant pleading guilty to a lesser offense or to only one or
some of the counts of a multi-count indictment in return for a lighter sentence than
that for the graver charge.29 Section 2, Rule 116 of the Rules of Criminal Procedure
provides:
4
SECTION 2. Plea of guilty to a lesser offense. — At arraignment, the accused, with
the consent of the offended party and the prosecutor, may be allowed by the trial
court to plead guilty to a lesser offense which is necessarily included in the offense
charged. After arraignment but before trial, the accused may still be allowed to plead
guilty to said lesser offense after withdrawing his plea of not guilty. No amendment of
the complaint or information is necessary.30
The provision ordains that with the consent of the offended party and the prosecutor,
plea bargaining to a lesser offense which is necessarily included in the offense
charged,31 may be allowed.
Contrary to the position taken by the trial court and the Court of Appeals, the
conformity of the prosecutor to the proposed plea bargaining in drugs cases is not
optional, nay, to be disregarded. For the prosecutor has full control of the prosecution
of criminal actions; his duty is to always prosecute the proper offense, not any lesser
or graver one, based on what the evidence on hand can sustain.32 As guardian of the
rights of the people, the State files the criminal action in the name of the People of the
Philippines. The prosecutor who represents the government is duty bound to defend
the public interests, threatened by crime, to the point that it is as though he or she
were the person directly injured by the offense. Viewed in this light, the consent of the
offended party, i.e. the State, will have to be secured from the prosecutor who acts on
its behalf.33
As early as the 1992 case of People v. Villarama, Jr.,34 the Court already clarified
that the acceptance of an offer to plead guilty to a lesser offense is not demandable
by the accused as a matter of right but is a matter that is addressed entirely to the trial
court's sound discretion.Ꮮαwρhi ৷ The Court ratiocinated:
x x x x Section 2, Rule 116 is clear. The consent of both the Fiscal and the offended
party is a condition precedent to a valid plea of guilty to a lesser offense. The reason
for this is obvious. The Fiscal has full control of the prosecution of criminal actions.
Consequently, it is his duty to always prosecute the proper offense, not any lesser or
graver one, when the evidence in his hands can only sustain the former.
It would not also be correct to state that there is no offended party in crimes under RA
6425 as amended. While the acts constituting the crimes are not wrong in
themselves, they are made so by law because they infringe upon the rights of others.
The threat posed by drugs against human dignity and the integrity of society is
malevolent and incessant. Such pernicious effect is felt not only by the addicts
themselves but also by their families. As a result, society's survival is endangered
because its basic unit, the family, is the ultimate victim of the drug menace. The state
is, therefore, the offended party in this case.
The same doctrine was reiterated in the recent case of Sayre v. Xenos,35 where the
Court emphasized that a plea bargain still requires mutual agreement of the parties
and remains subject to the approval of the court. The acceptance of an offer to plead
guilty to a lesser offense is not demandable by the accused as a matter of right but is
a matter addressed entirely to the sound discretion of the trial court.
Verily, the trial court here acted with grave abuse of discretion when it disregarded
the prosecutor’s vigorous objection to private respondent's plea bargaining proposal.
In view of the parties' failure to strike a mutual agreement on the matter, the trial court
should have ordered the continuation of the proceedings instead of rendering a
verdict of conviction based on private respondent's invalid pleas of guilty to two (2)
counts of Illegal Possession of Drug Paraphernalia.

Considering the foregoing irregularity, the Court is constrained to declare as invalid

both pleas of private respondent and the consequent verdict of conviction and
reinstate the charges against private respondent for violations of Sections 5 and 11 of
RA 9165, as amended by RA 10640.

Section 7, Rule 11736 of the Rules on Criminal Procedure is clear. The conviction of
the accused shall not be a bar to another prosecution for an offense which
necessarily includes the offense charged in the former complaint or information if the
plea of guilty to the lesser offense was made without the consent of the prosecutor
and of the offended party.

In closing, to dispel any lingering doubts on the validity of DOJ Department Circular
No. 027-18 which superseded Department Circular No. 061-17, the Court takes this
opportunity to reiterate Sayre:37

x x x x DOJ Circular No. 27 did not repeal, alter, or modify the Plea Bargaining
Framework in A.M. No. 18-03-16-SC.

Therefore, the DOJ Circular No. 27 provision pertaining to acceptable plea bargain for
Section 5 of R.A. 9165 did not violate the rule-making authority of the Court. DOJ
Circular No. 27 merely serves as an internal guideline for prosecutors to observe
before they may give their consent to proposed plea bargains.

So must it be.

ACCORDINGLY, the petition is GRANTED. The Decision38 of the Court of Appeals

dated October 28, 2019 in CA-G.R. SP No. 159780 is REVERSED and SET ASIDE.
The twin pleas of "guilty" entered by Naci Borras y Lascano to two (2) counts of Illegal
Possession of Drug Paraphernalia under Section 12 of RA 9165, as amended by RA
10640, and the Decision dated August 3 1, 2018 of the Regional Trial Court, Branch
61, Naga City in Criminal Case Nos. 2017-0358 and 2017-0359 are INVALIDATED.
The cases are REMANDED to the Regional Trial Court, Branch 61, Naga City for
resumption of the proceedings on the original charges of violations of Sections 5 and
11 of RA 9165, as amended by RA 10640.

SO ORDERED.

5
G.R. No. 214803, April 23, 2018
ALONA G. ROLDAN, Petitioner, v. SPOUSES CLARENCE I. BARRIOS AND
ANNA LEE T. BARRIOS, ROMMEL MATORRES, AND HON. JEMENA ABELLAR
ARBIS, IN HER CAPACITY AS PRESIDING JUDGE, BRANCH 6, REGIONAL
TRIAL COURT, AKLAN, Respondents.
PERALTA, J.:
Before us is a petition for certiorari assailing the Order1 dated July 22, 2014 issued by
the Regional Trial Court (RTC), Branch 6, Kalibo, Aklan as well as the Order2 dated
August 18, 2014 denying reconsideration thereof.
The antecedent facts are as follows:
On February 3, 2014, petitioner Alona G. Roldan filed an action3 for foreclosure of
real estate mortgage against respondents spouses Clarence I. Barrios and Anna Lee
T. Barrios and respondent Romel D. Matorres, docketed as Civil Case No. 9811. She
alleged the following:
xxxx
2. That on October 13, 2008, defendants borrowed from plaintiff the sum of Two
Hundred Fifty Thousand Pesos (P250,000.00), Philippine Currency, payable within
the period of one (1) year from said date, with an interest thereon at the rate of 5%
per month; and to secure the prompt and full payment of the principal and interest,
defendants made and executed on October 13, 2008 a Deed of Real Estate Mortgage
in favor of plaintiff upon a parcel of land and improvements thereon described as
follows:
A parcel of land (Lot 5891-A-4) situated in Baybay, Makato, Aklan, containing an area
of four hundred seventy-eight (478) square meters, more or less x x x declared in the
name of Spouses Clarence Barrios and Anna Lee T. Barrios, assessed in the sum of
P13,380.00, tax effectivity for the year 2008. Said land is covered by OCT No. P-5561
pt.
6
xxx
3. That the condition of said mortgage, as stated therein, is such, that if within the
period of one year from October 13, 2008, the defendants shall pay or cause to be
paid to the plaintiff, her heirs and assigns, the said sum of P250,000.00 together with
the agreed interest, then the said mortgage shall be discharged; otherwise, it shall
remain in full force and effect, to be enforceable in the manner provided by law.
4. That the time for payment of said loan is overdue and defendants failed and
refused to pay both the principal obligation and the interest due starting from
February 2011 to the present notwithstanding repeated demands;
5. That there are no other persons having or claiming interest in the mortgaged
property except Romel D. Matorres whom plaintiff recently discovered that the
defendants mortgaged again to the said person the same property subject of this suit
for One Hundred Fifty Thousand Pesos, (P150,000.00) on June 11, 2012 x x x The
said Romel D. Matorres is however a mortgagee in bad faith.
WHEREFORE, it is respectfully prayed that upon due notice and hearing, judgment
be rendered ordering defendants SPS. CLARENCE I. BARRIOS and ANNA LEE T.
BARRIOS:
1. To pay unto the court within the reglementary period of ninety days the sum of
P250,000.00 together with the stipulated interest at five percent (5%) per month
starting from February 2011 to the present, plus the additional sum of P25,000.00 the
total amount due for attorney's fees; litigation expenses and costs; and that in default
of such payment, the above-mentioned property be ordered sold to pay off the
mortgage debt and its accumulated interest;
2. To teach the defendants a lesson for having mortgaged the property subject of this
suit without plaintiffs consent or knowledge, the defendants be ordered to pay the
plaintiff the sum of P50,000.00 as exemplary damages.
3. That plaintiff be granted such other relief in law and equity.4
Respondents spouses Barrios filed their Answer5 with Special and Affirmative
Defenses contending that the computation of their alleged loan obligation was not
accurate; that they had filed with the RTC a petition for rehabilitation of a financially
distressed individuals under Special Proceeding No. 9845, thus there is a need to
suspend the foreclosure proceedings. On the other hand, respondent Matorres filed
his Answer6 with Special and Affirmative Defenses admitting that the subject land
was mortgaged to him; that he had also filed a judicial foreclosure case against
respondents spouses Barrios pending with the RTC of Kalibo Aklan, Branch 6,
docketed as Civil Case No. 9642; that petitioner had no cause of action against him
as they did not have any transaction with each other; and prayed for damages and
attorney's fees, and cross-claim against respondent spouses for moral damages.
On July 22, 2014, the RTC issued the assailed Order as follows:
Civil Cases Nos. 9642 and 9811 are complaints for Foreclosure of Real Estate
Mortgage that involved the same property, Lot 5891-A-4, situated in Baybay, Makato,
Aklan, owned by Spouses Clarence Barrios and Anna Lee Barrios.
It appearing from the complaint that the assessed value of the property mortgaged is
only P13,380.00 and the instant cases being a real action, the assessed value of the
property determines the jurisdiction.
The assessed value of the property involved being below P20,000.00, it is the first
level court that has jurisdiction over the cases.
Premises considered, for lack of jurisdiction, Civil Cases Nos. 9642 and 9811 are
ordered DISMISSED without prejudice.
SO ORDERED.7
Petitioner and respondent Matorres filed their respective motions for reconsideration.
In an Order dated August 18, 2014, the RTC denied petitioner's motion as follows:
xxxx
Petitioner in her Motion argued that foreclosure of real estate mortgage is an action
incapable of pecuniary estimation and jurisdiction lies with the Regional Trial Court.
Petitioner's argument is devoid of merit.
7
A petition for foreclosure of real estate mortgage is a real action and the assessed
value of the property determines jurisdiction while location of the property determines
the venue.
Premises considered, the Motion for Reconsideration is DENIED for lack of merit.
SO ORDERED.8
Respondent Matorres' motion for reconsideration was also denied in an Order9 dated
September 1, 2014.
Petitioner filed the instant petition for certiorari alleging grave abuse of discretion
committed by the RTC when it ordered the dismissal of her foreclosure case without
prejudice and denying her motion for reconsideration. She argues that foreclosure of
mortgage is an action incapable of pecuniary estimation which is within the exclusive
jurisdiction of the RTC.
In his Comment, respondent Matorres joins the position and arguments of petitioner
that the cause of action of the foreclosure cases is incapable of pecuniary estimation,
hence, falling within the jurisdiction of the RTC.
Respondents spouses Barrios filed their Explanation and Comment alleging that
petitioner violated the Tax Reform Act of 1997 for her failure to issue official receipts
on the payments made by them; that she failed to show any proof of authority from
the Bangko Sentral ng Pilipinas relative to her money-lending activities.
The issue for resolution is whether the RTC committed grave abuse of discretion in
dismissing the foreclosure cases filed with it on the ground of lack of jurisdiction.
Preliminarily, we need to point out that generally a direct recourse to this Court is
highly improper, for it violates the established policy of strict observance of the judicial
hierarchy of courts. Although this Court, the RTCs and the Court of Appeals have
concurrent jurisdiction to issue writs of certiorari, prohibition, mandamus, quo
warranto, habeas corpus and injunction, such concurrence does not give the
petitioner unrestricted freedom of choice of court forum. This Court is a court of last
resort, and must so remain if it is to satisfactorily perform the functions assigned to it
by the Constitution and immemorial tradition.10 However, the judicial hierarchy of
courts is not an iron-clad rule. A strict application of the rule of hierarchy of courts is
not necessary when the cases brought before the appellate courts do not involve
factual but legal questions.11 Since petitioner raises a pure question of law pertaining
to the court's jurisdiction on complaint for judicial foreclosure of sale, we would allow
petitioner's direct resort to us.
The RTC dismissed the foreclosure cases finding that being a real action and the
assessed value of the mortgaged property is only P13,380.00, it is the first level court
which has jurisdiction over the case and not the RTC.
Jurisdiction over the subject matter is the power to hear and determine cases of the
general class to which the proceedings in question belong. It is conferred by law and
an objection based on this ground cannot be waived by the parties.12 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.13
Batas Pambansa Blg. (BP) 129 as amended by Republic Act No. (RA) 7691
pertinently provides for the jurisdiction of the RTC and the first level courts as follows:
Sec. 19. Jurisdiction in civil cases. - Regional Trial Courts shall exercise exclusive
original jurisdiction:
1. In all civil actions in which the subject of the litigation is incapable of pecuniary
estimation;
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.
and
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:
8
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 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.
From the foregoing, the RTC exercises exclusive original jurisdiction in civil actions
where the subject of the litigation is incapable of pecuniary estimation. It also has
jurisdiction in civil cases involving title to, or possession of, real property or any
interest in it where the assessed value of the property involved exceeds P20,000.00,
and if it is below P20,000.00, it is the first level court which has jurisdiction. An action
"involving title to real property" means that the plaintiffs cause of action is based on a
claim that he owns such property or that he has the legal right to have exclusive
control, possession, enjoyment, or disposition of the same.14
The allegations and reliefs sought in petitioner's action for foreclosure of mortgage
showed that the loan obtained by respondents spouses Barrios from petitioner fell
due and they failed to pay such loan which was secured by a mortgage on the
property of the respondents spouses; and prayed that in case of default of payment of
such mortgage indebtedness to the court, the property be ordered sold to answer for
the obligation under the mortgage contract and the accumulated interest. It is worthy
to mention that the essence of a contract of mortgage indebtedness is that a property
has been identified or set apart from the mass of the property of the debtor-mortgagor
as security for the payment of money or the fulfillment of an obligation to answer the
amount of indebtedness, in case of default in payment.15 Foreclosure is but a
necessary consequence of non-payment of the mortgage indebtedness.16 In a real
estate mortgage when the principal obligation is not paid when due, the mortgagee
has the right to foreclose the mortgage and to have the property seized and sold with
the view of applying the proceeds to the payment of the obligation.17 Therefore, the
foreclosure suit is a real action so far as it is against property, and seeks the judicial
recognition of a property debt, and an order for the sale of the res.18
As foreclosure of mortgage is a real action, it is the assessed value of the property
which determines the court's jurisdiction. Considering that the assessed value of the
mortgaged property is only P13,380.00, the RTC correctly found that the action falls
within the jurisdiction of the first level court. er Section 33(3) of BP 129 as amended.
Petitioner cites Russell v. Vestil19 to show that action for foreclosure of mortgage is SO ORDERED.
an action incapable of pecuniary estimation and, therefore, within the jurisdiction of
the RTC. We are not persuaded. In the Russell case, we held:

In Singsong vs. Isabela Sawmill, we had the occasion to rule that:

[I]n determining whether an action is one the subject matter of which is not capable of
pecuniary estimation, this Court has adopted the criterion of first ascertaining the
nature of the principal action or remedy sought. If it is primarily for the recovery of a
sum of money, the claim is considered capable of pecuniary estimation, and whether
jurisdiction is in the municipal courts or in the courts of first instance would depend on
the amount of the claim. However, where the basic issue is something other than the
right to recover a sum of money, where the money claim is purely incidental to, or a
consequence of, the principal relief sought, this Court has considered such actions as
cases where the subject of the litigation may not be estimated in terms of money, and
are cognizable exclusively by courts of first instance (now Regional Trial Courts).

Examples of actions incapable of pecuniary estimation are those for specific

performance, support, or foreclosure of mortgage or annulment of judgment; also
actions questioning the validity of a mortgage, annulling a deed of sale or conveyance
and to recover the price paid and for rescission, which is a counterpart of specific
performance.

While actions under Sec. 33(3) of B.P. 129 are also incapable of pecuniary
estimation, the law specifically mandates that they are cognizable by the MTC,
METC, or MCTC where the assessed value of the real property involved does exceed
P20,000.00 in Metro Manila, or P50,000.00, if located elsewhere. If the value exceeds
P20,000.00 or P50,000.00 as the case may be, it is the Regional Trial Courts which
have jurisdiction under Sec. 19(2). However, the subject matter of the complaint in
this case is annulment of a document denominated as "DECLARATION OF HEIRS
AND DEED OF CONFIRMATION OF PREVIOUS ORAL PARTITION."20

Clearly, the last paragraph clarified that while civil actions which involve title to, or
possession of, real property, or any interest therein, are also incapable of pecuniary
estimation as it is not for recovery of money, the court's jurisdiction will be determined
by the assessed value of the property involved.

WHEREFORE, the petition for certiorari is DISMISSED as we find no grave abuse of

discretion committed by the Regional Trial Court, Branch 6, Kalibo, Aklan in
dismissing the complaint for lack of jurisdiction.

9
G.R. No. 196874
The Heirs of the Late Spouses ALEJANDRO RAMIRO and FELICISIMA
LLAMADA, namely; HENRY L. RAMIRO; MERLYN R. TAGUBA; MARLON L.
RAMIRO; MARIDEL R. SANTELLA, WILMA L. RAMIRO; VILMA R. CIELO and
CAROLYN R. CORDERO, Petitioners
vs.
Spouses ELEODORO and VERNA BA CARON, Respondents
JARDELEZA, J.:
This is a petition for review on certiorari1 under Rule 45 of the Revised Rules of Court
assailing the October 19, 2010 Decision2 (assailed Decision) and May 3, 2011
Resolution3 (assailed Resolution) of the Court of Appeals (CA) in CA-G.R. CV No.
01350-MIN. The CA affirmed in toto the July 13, 2007 Decision4 of Branch 32 of the
Regional Trial Court (RTC) of Lupon, Davao Oriental, in Civil Case No. 1966 (045).
Respondent spouses Eleodoro and Verna Bacaron (spouses Bacaron) filed Civil
Case No. 1966 (045) before the RTC against petitioners. In their amended complaint,
5 spouses Bacaron claimed that the father of petitioners, the late Alejandro Ramiro
(Alejandro), was the registered owner of Lot 329, Cad-600 containing an area of
48,639 square meters and covered by Original Certificate of Title (OCT) No. P-12524
(property); that Alejandro and his wife, Felicisima Llamada (spouses Ramiro), sold the
property to spouses Bacaron, as evidenced by a Deed of Sale6 executed on October
20, 1991; 7 that spouses Bacaron took possession of the property after the sale; that
the property, however, was earlier mortgaged by spouses Ramiro to the Development
Bank of the Philippines (DBP); that spouses Bacaron paid the DBP ₱430,150.00 for
the redemption of the property; and that in June 1998, petitioners forcibly
dispossessed spouses Bacaron of the property. 8
Petitioners, on the other hand, denied the material allegations of the amended
complaint, raising the following affirmative defenses: (a) the RTC does not have
jurisdiction over the case considering that it involves recovery of possession of the
property; (b) the instrument denominated as a Deed of Sale should be interpreted as
an equitable mortgage; and (c) laches has barred respondents from instituting the
complaint.9
10
After trial on the merits, the RTC rendered a Decision10 on July 13, 2007 in favor of
spouses Bacaron. It ruled that spouses Bacaron were able to prove by
preponderance of evidence the due execution of the Deed of Sale dated October 20,
1991 with spouses Ramiro over the property. Although the original copy of the Deed
of Sale was lost, the RTC held that spouses Bacaron were able to introduce
competent secondary evidence to prove its existence. 11 It also found that the
purchase price of ₱400,000.00 as stated in the Deed of Sale corresponded, more or
less, to the amount paid by spouses Bacaron to the DBP. The dispositive portion of
the RTC Decision states:
WHEREFORE, Premises Considered, a DECISION is hereby issued:
1. DECLARING as VALID the Deed of Sale dated October 20, 1991;
2. Directing herein Defendants to execute a Deed of Extra-Judicial Partition with
Confirmation of the Sale dated October 20, 1991 in favor of herein Plaintiffs within
fifteen (15) days from the finality of this DECISION. Should Defendants fail to execute
said document as directed by the Court the execution of said document shall be
undertaken pursuant to law and the rules;
3. Directing the Register of Deeds to cause the registration of the parcel of land
subject of this case in the name of the Plaintiffs upon the presentation by Plaintiffs of
the Deed of Extra-Judicial Partition and Confirmation of Sale referred to in par. No. 2
hereof.
a) Directing Defendants and all other persons acting for and in their behalf to vacate
the property subject of this case and restore the possession thereof to herein
Plaintiffs;
b) Directing Defendants to pay the amount of P30,000.00 as reasonable Attorney's
Fees.
SO ORDERED. 12 (Emphasis omitted.)
Aggrieved, petitioners appealed the trial court's Decision to the CA. In their appeal, We grant the petition.
petitioners argued that the main thrust of the complaint was to recover the property;
yet, spouses Bacaron failed to allege its assessed value. Petitioners, thus, asserted
that the RTC did not acquire jurisdiction over the subject matter of the case pursuant
Section 19 of B.P. Blg. 129, as amended by R.A. No. 7691, provides that the RTC
to Batas Pambansa (B.P.) Blg. 129, 13 as amended by Republic Act (R.A.) No. 7691.
shall exercise exclusive original jurisdiction on the following actions:
14

Sec. 19. Jurisdiction in civil cases. - Regional Trial Courts shall exercise exclusive
On October 19, 2010, the CA rendered its assailed Decision, 15 dismissing the
original jurisdiction.
appeal and affirming the RTC Decision in toto. The CA upheld the jurisdiction of the
RTC over the subject matter of the case. Noting that the amended complaint alleged
causes of action for the declaration of validity of the Deed of Sale or specific
performance, and recovery of possession, damages, attorney's fees and injunction all (1) In all civil actions in which the subject of the litigation is incapable of pecuniary
of which are incapable of pecuniary estimation, joinder in the RTC is allowed by the estimation;
Rules of Court. 16

The CA likewise rejected petitioners' contention that in view of their actual physical
possession of the property and their payment of realty taxes thereon, the real
transaction between their late parents and spouses Bacaron was an equitable
mortgage. The CA ruled that petitioners failed to assail the trial court's finding that the
reason they currently have possession of the property was because they forcibly took
possession of the same from respondents in June 1998. The CA also found that
contrary to petitioners' claims of religious payment of realty taxes, the official receipts
they presented showed that they paid the realty taxes for 1991 and 1992, and for
1993 and 1994, only on August 17, 1998 and March 12, 1999, respectively. 17 The
CA also found petitioners' arguments on laches untenable due to their failure to prove
its elements. 18
(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

Meanwhile, Section 33 of the same law provides the exclusive original jurisdiction of
the first level courts, viz.:
Petitioners filed a motion for reconsideration but the same was denied by the CA via
its assailed Resolution. 19 Hence, this petition which presents the following issues:

Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and Municipal
Circuit Trial Courts in Civil Cases. - Metropolitan Trial Courts, Municipal Trial Courts,
I. Whether the RTC acquired jurisdiction over the subject matter of the action. and Municipal Circuit Trial Courts shall exercise:

II. Whether the Deed of Sale dated October 20, 1991 should be treated as an xxxx
equitable mortgage.

(3) Exclusive original jurisdiction in all civil actions which involve title to, or possession
III. Whether the spouses Bacaron's claims are barred by laches. 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
11
pesos (P50,000.00) 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 Respondents' amended complaint pertinently narrates the following:
value of the adjacent lots.

Settled is the rule that 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.20 For instance, when the main relief sought is specific
performance, the action is incapable of pecuniary estimation within the exclusive
jurisdiction of the RTC. When the action, on the other hand, primarily involves title to,
or possession of land, the court which has exclusive original jurisdiction over the
same is determined by the assessed value of the property.
3. That the above-named defendants are all surviving heirs of the late spouses
[Alejandro] Raqmiro (sic) and Felicisima Llamada-Ramiro;
4. That the late Alejandro Ramiro, father of the defendants, is the registered owner of
a parcel of land situated in Gov. Generoso, Davao Oriental, consisting of an area of
about Forty Eight Thousand Six Hundred Thirty Nine (48,639) square meters, more or
less, and embraced and covered by Original Certificate of Title (OCT) No. P-12524;
said property is mainly used and operated as a fish pond, with some portions of the
said parcel of land being devoted to and planted with coconut trees;

Here, petitioners argue against the CA's view that the action is under the RTC's (Said parcel of land formed part of spouses Ramiro's [spouses Alejendro (sic)
jurisdiction because it is incapable of pecuniary estimation. They contend that the Ramiro's and Felicisima Llamada's] conjugal properties- as registered owner
main thrust of respondents' complaint before the RTC is the recovery of possession of Alejandro Ramiro is referred-to and acknowledged in the property's title as married to
the property. Thus, the primary purpose of all of respondents' alternative causes of Felicisima Llamda') (sic);
action involves title to or possession of real property. This is allegedly evident from
respondents' amended complaint which seeks, among others, to cancel OCT No. P-
12524 covering the property, to have a new title issued in their name, and to place
xxxx
respondents in peaceful and undisturbed possession of the property. In view of these
allegations, petitioners posit that the complaint should be filed with the court having
jurisdiction based on the assessed value of the property. In this case, however, there
was no effort on the part of respondents to allege the assessed value of the property. 5. That sometime in 1991, said spouses Alejandro Ramiro and Felicisima Llamada-
21 Ramiro sold the abovementioned property unto the plaintiffs herein, as may be shown
and evidenced by a Deed of Sale duly executed by the spouses, dated October 20,
1991;
Spouses Bacaron counter that the case record shows that the main relief prayed for
in the amended complaint is one for the declaration of validity and effectivity of the
Deed of Sale and specific performance or, in the alternative, that petitioners be xxxx
ordered and directed to execute the deed or instrument of conveyance and transfer of
the property in respondents' favor. They argue that based on existing jurisprudence,
the Court has recognized actions involving the legality of conveyances as actions
11.a. That just sometime after the aforesaid sale of the subject property, plaintiffs took
incapable of pecuniary estimation. Likewise, actions for specific performance are
over the possession thereof;
exclusively within the jurisdiction of the RTC. Hence, in this case, since the main
reliefs prayed for by respondents are the declaration of validity of the Deed of Sale
and specific performance, the RTC has jurisdiction over the case.22
11. b. That likewise, since the subject property was earlier mortgaged by the Ramiro
spouses unto the Development Bank of the Philippines (DBP). Plaintiffs caused the
payment unto the bank the amount of about Four Hundred Thirty Thousand Pesos
We agree with petitioners.

12
and Hundred Fifty Pesos (P430, 150.00) for the redemption of the property from the
Development Bank of the Philippines;
12. That Alejandro Ramiro passed away sometime in 1996 or thereabout; That
Felicisima Llamada on the other hand died later in 1997 or sometime thereabout;
13. That thereafter (sic), sometime on the month of June of 1998, or thereabout, the
above-named defendants, led by defendant Henry Ramiro, unlawfully and coercively
took over the possession of the subject property without any justifiable cause
whatsoever, to the exclusion of the plaintiffs, arrogating unto themselves the
supposed ownership of the property;
14. And despite several demands, defendants unjustifiably refused to return unto the
plaintiffs the possession thereof, thus causing unwarranted damage and injuries unto
the latter;
x x x x23 (Underscoring in the original.)
In the same vein, the following are the reliefs sought by respondents in their amended
complaint:
a.) that a Temporary Restraining Order (TRO) be issued enjoining and prohibiting the
defendants from exercising, doing and/or otherwise causing to be done all acts,
deeds and activities which may be inimical to the plaintiffs' claims, rights and interest
as lawful owners thereof - more specifically (but not limited to ), the actual operation
of the fishpond by the defendants, and defendants' gathering and harvesting of
coconuts and other products found within the property; directing the defendants to
return unto the plaintiffs the possession of the subject property; and enjoining and
prohibiting said defendants from further effecting and causing whatever acts of
disturbances in contravention of plaintiffs['] peaceful possession of the property;
b.) that Writs of Preliminary Mandatory and Prohibitory Injunctions likewise be issued
in plaintiffs' favor directing and/or providing the same wise (as stated in the
foregoing);
13
c.) that after hearing, the said Injunctions be made permanent;
d.) that after the fact and verity of the subject property's sale (in plaintiffs' favor) shall
have been proved and established in the course of the proceedings of the above-
entitled case, the validity and effectivity of said sale be categorically declared and
upheld: Or otherwise, defendants be ordered and directed to execute the proper deed
or instrument of conveyance and transfer of the subject property in plaintiffs' favor;
e.) that [the] Original Certificate of Title (OCT) No. P12524 be ordered cancelled and
in lieu thereof, another title be accordingly issued in the name of the plaintiffs; and
f.) that the plaintiffs be ordered placed in a peaceful and undisturbed possession over
the property.
g.) that defendants be ordered to pay plaintiffs the sum of P20,000.00 as attorney's
fees and P1,200.00 as appearance fees of counsel per hearing;
h.) that defendants be made to pay plaintiffs the amount of P100,000.00 as moral
damages as well as exemplary damages in the amount to be fixed by this Honorable
Court.
All other reliefs in plaintiffs' favor, as may be deemed by this Honorable Court as just
and equitable under the premises, are herein likewise prayed for. 24 (Emphasis
supplied; underscoring in the original.)
It is clear from the foregoing that while respondents claim that their amended
complaint before the RTC is denominated as one for the declaration of validity of the
Deed of Sale and for specific performance, the averments in their amended complaint
and the character of the reliefs sought therein reveal that the action primarily involves
title to or possession of real property. An action "involving title to real property" means
that the plaintiffs cause of action is based on a claim that he owns such property or
that he has the legal rights to have exclusive control, possession, enjoyment, or
disposition of the same. Title is the "legal link between (1) a person who owns
property and (2) the property itself. "25
The ultimate relief sought by respondents is for the recovery of the property through
the enforcement of its sale in their favor by the late spouses Ramiro. Their other
causes of action for the cancellation of the original title and the issuance of a new one
in their name, as well as' for injunction and damages, are merely incidental to the
recovery of the property. 26 Before any of the other reliefs respondents prayed for in
their complaint can be granted, the issue of who between them and petitioners has
the valid title to the lot must first be determined. 27
WHEREFORE, the petition is GRANTED. The Decision dated October 19, 2010 and
Resolution dated May 3, 2011 of the Court of Appeals in CA-G.R. CV No. 01350-MIN
are hereby REVERSED and SET ASIDE. The Decision of the Regional Trial Court
dated July 13, 2007 is declared NULL and VOID. The amended complaint in Civil
Case No. 1966 (045) is dismissed without prejudice.
SO ORDERED.

Similarly in Gochan v. Gochan,28 we ruled that where a complaint is entitled as one

for specific performance but nonetheless prays for the issuance of a deed of sale for
a parcel of land, its primary objective and nature is one to recover the parcel of land
itself and is, thus, deemed a real action. Accordingly, under these circumstances, the
court which has jurisdiction over the subject matter of the case is determined by the
assessed value of the subject property. 29

Here, respondents neither alleged the assessed value of the property. The Court
cannot take judicial notice of the assessed or market value of lands. Thus, absent any
allegation in the complaint of the assessed value of the property, it cannot be
determined which between the RTC or the Municipal Trial Court had original and
exclusive jurisdiction over respondents' action. Consequently, the complaint filed
before the RTC should be dismissed.30

Furthermore, 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. 31 In resolving the issue of
whether or not the correct amount of docket fees were paid, it is also necessary to
determine the true nature of the complaint. 32 Having settled that the action instituted
by respondents is a real action and not one incapable of pecuniary estimation, the
basis for determining the correct docket fees shall, therefore, be the assessed value
of the property, or the estimated value thereof as alleged by the claimant. 33 As
already discussed, however, respondents did not allege the assessed value of the
property in their amended complaint. They also did not allege its estimated value. As
a result, the correct docket fees could not have been computed and paid by
respondents and the RTC could not have acquired jurisdiction over the subject matter
of the case.34 All the proceedings before it are consequently null and void.

In light of all the foregoing, we see no further need to discuss the other issues raised
by petitioners.1awp++i1

14
G.R. No. 208232, March 10, 2014
SURVIVING HEIRS OF ALFREDO R. BAUTISTA, NAMELY: EPIFANIA G.
BAUTISTA AND ZOEY G. BAUTISTA, Petitioners, v. FRANCISCO LINDO AND
WELHILMINA LINDO; AND HEIRS OF FILIPINA DAQUIGAN, NAMELY: MA.
LOURDES DAQUIGAN, IMELDA CATHERINE DAQUIGAN, IMELDA DAQUIGAN
AND CORSINO DAQUIGAN, REBECCA QUIAMCO AND ANDRES QUIAMCO,
ROMULO LORICA AND DELIA LORICA, GEORGE CAJES AND LAURA CAJES,
MELIDA BAÑEZ AND FRANCISCO BAÑEZ, MELANIE GOFREDO, GERVACIO
CAJES AND ISABEL CAJES, EGMEDIO SEGOVIA AND VERGINIA SEGOVIA,
ELSA N. SAM, PEDRO M. SAM AND LINA SAM, SANTIAGO MENDEZ AND MINA
MENDEZ, HELEN M. BURTON AND LEONARDO BURTON, JOSE JACINTO AND
BIENVENIDA JACINTO, IMELDA DAQUIGAN, LEO MATIGA AND ALICIA
MATIGA, FLORENCIO ACEDO JR., AND LYLA VALERIO, Respondents.
DECISION
VELASCO JR., J.:
The Case
This is a Petition for Review on Certiorari under Rule 45 assailing the April 25, 2013
Order of the Regional Trial Court (RTC) in Civil Case No. (1798)-021 as well as its
Order of July 3, 2013 denying reconsideration.
The Facts
Alfredo R. Bautista (Bautista), petitioner’s predecessor, inherited in 1983 a free-patent
land located in Poblacion, Lupon, Davao Oriental and covered by Original Certificate
of Title (OCT) No. (1572) P-6144. A few years later, he subdivided the property and
sold it to several vendees, herein respondents, via a notarized deed of absolute sale
dated May 30, 1991. Two months later, OCT No. (1572) P-6144 was canceled and
Transfer Certificates of Title (TCTs) were issued in favor of the
vendees.1crallawlibrary
Three years after the sale, or on August 5, 1994, Bautista filed a complaint for
repurchase against respondents before the RTC, Branch 32, Lupon, Davao Oriental,
15
docketed as Civil Case No. 1798,2 anchoring his cause of action on Section 119 of
Commonwealth Act No. (CA) 141, otherwise known as the “Public Land Act,” which
reads:chanRoblesVirtualawlibrary
SECTION 119. Every conveyance of land acquired under the free patent or
homestead provisions, when proper, shall be subject to repurchase by the applicant,
his widow, or legal heirs, within a period of five years from the date of the
conveyance.
Respondents, in their Answer, raised lack of cause of action, estoppel, prescription,
and laches, as defenses.
Meanwhile, during the pendency of the case, Bautista died and was substituted by
petitioner Epifania G. Bautista (Epifania).
Respondents Francisco and Welhilmina Lindo later entered into a compromise
agreement with petitioners, whereby they agreed to cede to Epifania a three thousand
two hundred and thirty square meter (3,230 sq.m.)-portion of the property as well as
to waive, abandon, surrender, and withdraw all claims and counterclaims against
each other. The compromise was approved by the RTC in its Decision dated January
27, 2011, the fallo of which reads:chanRoblesVirtualawlibrary
WHEREFORE, a DECISION is hereby rendered based on the above-quoted
Compromise Agreement and the parties are enjoined to strictly comply with the terms
and conditions of the same.
SO ORDERED.3
Other respondents, however, filed a Motion to Dismiss4 dated February 4, 2013,
alleging that the complaint failed to state the value of the property sought to be
recovered. Moreover, they asserted that the total selling price of all the properties is
only sixteen thousand five hundred pesos (PhP 16,500), and the selling price or
market value of a property is always higher than its assessed value. Since Batas
Pambansa Blg. (BP) 129, as amended, grants jurisdiction to the RTCs over civil
actions involving title to or possession of real property or interest therein where the
assessed value is more than PhP 20,000, then the RTC has no jurisdiction over the
complaint in question since the property which Bautista seeks to repurchase is below
the PhP 20,000 jurisdictional ceiling.
RTC Ruling5
Acting on the motion, the RTC issued the assailed order dismissing the complaint for
lack of jurisdiction. The trial court found that Bautista failed to allege in his complaint
that the value of the subject property exceeds 20 thousand pesos. Furthermore, what
was only stated therein was that the total and full refund of the purchase price of the
property is PhP 16,500. This omission was considered by the RTC as fatal to the
case considering that in real actions, jurisdictional amount is determinative of whether
it is the municipal trial court or the RTC that has jurisdiction over the case.
With respect to the belated filing of the motion, the RTC, citing Cosco Philippines
Shipping, Inc. v. Kemper Insurance Company,6 held that a motion to dismiss for lack
of jurisdiction may be filed at any stage of the proceedings, even on appeal, and is
not lost by waiver or by estoppel. The dispositive portion of the assailed Order
reads:chanRoblesVirtualawlibrary
WHEREFORE, the complaint for Repurchase, Consignation, with Preliminary
Injunction and Damages is hereby dismissed for lack of jurisdiction.
SO ORDERED.7crallawlibrary
Assignment of Errors
Their motion for reconsideration having been denied, petitioners now seek recourse
before this Court with the following assigned errors:chanRoblesVirtualawlibrary
I signed by respondents. Lastly, respondents argue that repurchase is a real action
THE PUBLIC RESPONDENT RTC ERRED IN ADMITTING THE MOTION TO
DISMISS DATED FEBRUARY 4, 2013, BELATEDLY FILED BY THE PRIVATE
RESPONDENTS IN THE CASE.
16
II
THE PUBLIC RESPONDENT RTC ERRED IN HOLDING THAT THE INSTANT
CASE FOR REPURCHASE IS A REAL ACTION.8crallawlibrary
The Issue
Stated differently, the issue for the Court’s resolution is: whether or not the RTC erred
in granting the motion for the dismissal of the case on the ground of lack of
jurisdiction over the subject matter.
Arguments
Petitioners argue that respondents belatedly filed their Motion to Dismiss and are now
estopped from seeking the dismissal of the case, it having been filed nine (9) years
after the filing of the complaint and after they have actively participated in the
proceedings. Additionally, they allege that an action for repurchase is not a real
action, but one incapable of pecuniary estimation, it being founded on privity of
contract between the parties. According to petitioners, what they seek is the
enforcement of their right to repurchase the subject property under Section 119 of CA
141.
Respondents, for their part, maintain that since the land is no longer devoted to
agriculture, the right of repurchase under said law can no longer be availed of, citing
Santana v. Mariñas.9 Furthermore, they suggest that petitioners intend to resell the
property for a higher profit, thus, the attempt to repurchase. This, according to
respondents, goes against the policy and is not in keeping with the spirit of CA 141
which is the preservation of the land gratuitously given to patentees by the State as a
reward for their labor in cultivating the property. Also, the Deed of Absolute Sale
presented in evidence by Bautista was unilaterally executed by him and was not
capable of pecuniary estimation.
Our Ruling

The petition is meritorious.
Jurisdiction of courts is granted by the Constitution and pertinent laws.
Jurisdiction of RTCs, as may be relevant to the instant petition, is provided in Sec. 19
of BP 129, which reads:chanRoblesVirtualawlibrary
Sec. 19. Jurisdiction in civil cases. — Regional Trial Courts shall exercise exclusive
original jurisdiction:chanRoblesVirtualawlibrary
1) In all civil actions in which the subject of the litigation is incapable of pecuniary
estimation;
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.
On the other hand, jurisdiction of first level courts is prescribed in Sec. 33 of BP 129,
which provides:chanRoblesVirtualawlibrary
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:chanRoblesVirtualawlibrary
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
17
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: 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.
The core issue is whether the action filed by petitioners is one involving title to or
possession of real property or any interest therein or one incapable of pecuniary
estimation.
The course of action embodied in the complaint by the present petitioners’
predecessor, Alfredo R. Bautista, is to enforce his right to repurchase the lots he
formerly owned pursuant to the right of a free-patent holder under Sec. 119 of CA 141
or the Public Land Act.
The Court rules that the complaint to redeem a land subject of a free patent is a civil
action incapable of pecuniary estimation.
It is a well-settled rule that jurisdiction of the court is determined by the allegations in
the complaint and the character of the relief sought.10 In this regard, the Court, in
Russell v. Vestil,11 wrote that “in determining whether an action is one the subject
matter of which is not capable of pecuniary estimation this Court has adopted the
criterion of first ascertaining the nature of the principal action or remedy sought. If it is
primarily for the recovery of a sum of money, the claim is considered capable of
pecuniary estimation, and whether jurisdiction is in the municipal courts or in the
RTCs would depend on the amount of the claim.” But where the basic issue is
something other than the right to recover a sum of money, where the money claim is
purely incidental to, or a consequence of, the principal relief sought, this Court has
considered such actions as cases where the subject of the litigation may not be
estimated in terms of money, and, hence, are incapable of pecuniary estimation.
These cases are cognizable exclusively by RTCs.12crallawlibrary
Settled jurisprudence considers some civil actions as incapable of pecuniary
estimation, viz:chanRoblesVirtualawlibrary
1. Actions for specific performance;
2. Actions for support which will require the determination of the civil status;
3. The right to support of the plaintiff;
4. Those for the annulment of decisions of lower courts;
5. Those for the rescission or reformation of contracts;13crallawlibrary
6. Interpretation of a contractual stipulation.14
The Court finds that the instant cause of action to redeem the land is one for specific
performance.
The facts are clear that Bautista sold to respondents his lots which were covered by a
free patent. While the deeds of sale do not explicitly contain the stipulation that the
sale is subject to repurchase by the applicant within a period of five (5) years from the
date of conveyance pursuant to Sec. 119 of CA 141, still, such legal provision is
deemed integrated and made part of the deed of sale as prescribed by law. It is basic
that the law is deemed written into every contract.15 Although a contract is the law
between the parties, the provisions of positive law which regulate contracts are
deemed written therein and shall limit and govern the relations between the parties.16
Thus, it is a binding prestation in favor of Bautista which he may seek to enforce.
That is precisely what he did. He filed a complaint to enforce his right granted by law
to recover the lot subject of free patent. Ergo, it is clear that his action is for specific
performance, or if not strictly such action, then it is akin or analogous to one of
specific performance. Such being the case, his action for specific performance is
incapable of pecuniary estimation and cognizable by the RTC.
Respondents argue that Bautista’s action is one involving title to or possession of real
property or any interests therein and since the selling price is less than PhP 20,000,
then jurisdiction is lodged with the MTC. They rely on Sec. 33 of BP 129.
Republic Act No. 769117 amended Sec. 33 of BP 129 and gave Metropolitan Trial
Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts 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 (PhP 20,000) or, in civil actions in Metro Manila,
where such assessed value does not exceed fifty thousand pesos (PhP 50,000)
exclusive of interest, damages of whatever kind, attorney’s fees, litigation expenses
and costs.
18
At first blush, it appears that the action filed by Bautista involves title to or possession
of the lots he sold to respondents. Since the total selling price is less than PhP
20,000, then the MTC, not the RTC, has jurisdiction over the case. This proposition is
incorrect for the re-acquisition of the lots by Bautista or herein successors-in-interests,
the present petitioners, is but incidental to and an offshoot of the exercise of the right
by the latter to redeem said lots pursuant to Sec. 119 of CA 141. The reconveyance
of the title to petitioners is solely dependent on the exercise of such right to
repurchase the lots in question and is not the principal or main relief or remedy
sought. Thus, the action of petitioners is, in reality, incapable of pecuniary estimation,
and the reconveyance of the lot is merely the outcome of the performance of the
obligation to return the property conformably to the express provision of CA 141.
Even if we treat the present action as one involving title to real property or an interest
therein which falls under the jurisdiction of the first level court under Sec. 33 of BP
129, as the total selling price is only PhP 16,000 way below the PhP 20,000 ceiling,
still, the postulation of respondents that MTC has jurisdiction will not hold water. This
is because respondents have actually participated in the proceedings before the RTC
and aggressively defended their position, and by virtue of which they are already
barred to question the jurisdiction of the RTC following the principle of jurisdiction by
estoppel.
In Heirs of Jose Fernando v. De Belen, it was held that the party raising defenses to
the complaint, actively participating in the proceedings by filing pleadings, presenting
his evidence, and invoking its authority by asking for an affirmative relief is deemed
estopped from questioning the jurisdiction of the court.18crallawlibrary
Here, we note that aside from the belated filing of the motion to dismiss--it having
been filed nine (9) years from the filing of the complaint--respondents actively
participated in the proceedings through the following acts:chanRoblesVirtualawlibrary
By filing their Answer and Opposition to the Prayer for Injunction19 dated September
29, 1994 whereby they even interposed counterclaims, specifically: PhP 501,000 for
unpaid survey accounts, PhP 100,000 each as litigation expenses, PhP 200,000 and
PhP 3,000 per daily appearance by way of attorney’s fees, PhP 500,000 as moral
damages, PhP 100,000 by way of exemplary damages, and costs of suit;
By participating in Pre-trial;
By moving for the postponement of their presentation of evidence;20crallawlibrary

By presenting their witness;21 and

By submitting the compromise agreement for approval.22crallawlibrary

Having fully participated in all stages of the case, and even invoking the RTC’s
authority by asking for affirmative reliefs, respondents can no longer assail the
jurisdiction of the said trial court. Simply put, considering the extent of their
participation in the case, they are, as they should be, considered estopped from
raising lack of jurisdiction as a ground for the dismissal of the action.

WHEREFORE, premises considered, the instant petition is hereby GRANTED. The

April 25, 2013 and July 3, 2013 Orders of the Regional Trial Court in Civil Case No.
(1798)-021 are hereby REVERSED and SET ASIDE.

The Regional Trial Court, Branch 32 in Lupon, Davao Oriental is ORDERED to

proceed with dispatch in resolving Civil Case No. (1798)-021.

No pronouncement as to costs.

SO ORDERED.

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