JURISDICTION

I.
G.R. No. 173915 : February 22, 2010
IRENE SANTE AND REYNALDO SANTE, Petitioners, v. HON. EDILBERTO T. CLARAVALL, in his
capacity as Presiding Judge of Branch 60, Regional Trial Court of Baguio City, and VITA N.
KALASHIAN, Respondents.
DECISION
VILLARAMA, JR., J.:
Before this Court is a petition for certiorari 1cralaw under Rule 65 of the 1997 Rules of Civil Procedure, as
amended, filed by petitioners Irene and Reynaldo Sante assailing the Decision 2cralaw dated January 31,
2006 and the Resolution3cralaw dated June 23, 2006 of the Seventeenth Division of the Court of Appeals
in CA-G.R. SP No. 87563. The assailed decision affirmed the orders of the Regional Trial Court (RTC) of
Baguio City, Branch 60, denying their motion to dismiss the complaint for damages filed by respondent
Vita Kalashian against them.
The facts, culled from the records, are as follows:
On April 5, 2004, respondent filed before the RTC of Baguio City a complaint for damages 4cralaw against
petitioners. In her complaint, docketed as Civil Case No. 5794-R, respondent alleged that while she was
inside the Police Station of Natividad, Pangasinan, and in the presence of other persons and police
officers, petitioner Irene Sante uttered words, which when translated in English are as follows, " How
many rounds of sex did you have last night with your boss, Bert? You fuckin bitch! " Bert refers to Albert
Gacusan, respondent's friend and one (1) of her hired personal security guards detained at the said
station and who is a suspect in the killing of petitioners close relative. Petitioners also allegedly went
around Natividad, Pangasinan telling people that she is protecting and cuddling the suspects in the
aforesaid killing. Thus, respondent prayed that petitioners be held liable to pay moral damages in the
amount of P300,000.00; P50,000.00 as exemplary damages; P50,000.00 attorney's fees; P20,000.00
litigation expenses; and costs of suit.
Petitioners filed a Motion to Dismiss5cralaw on the ground that it was the Municipal Trial Court in Cities
(MTCC) and not the RTC of Baguio, that had jurisdiction over the case. They argued that the amount of
the claim for moral damages was not more than the jurisdictional amount of P300,000.00, because the
claim for exemplary damages should be excluded in computing the total claim.
On June 24, 2004,6cralaw the trial court denied the motion to dismiss citing our ruling in Movers-Baseco
Integrated Port Services, Inc. v. Cyborg Leasing Corporation .7cralaw The trial court held that the total
claim of respondent amounted toP420,000.00 which was above the jurisdictional amount for MTCCs
outside Metro Manila. The trial court also later issued Orders on July 7, 2004 8cralaw and July 19,
2004,9cralaw respectively reiterating its denial of the motion to dismiss and denying petitioners motion for
reconsideration.
Aggrieved, petitioners filed on August 2, 2004, a Petition for Certiorari and Prohibition,10cralaw docketed
as CA-G.R. SP No. 85465, before the Court of Appeals. Meanwhile, on July 14, 2004, respondent and
her husband filed an Amended Complaint11cralaw increasing the claim for moral damages

from P300,000.00 to P1,000,000.00. Petitioners filed a Motion to Dismiss with Answer Ad Cautelam and
Counterclaim, but the trial court denied their motion in an Order 12cralawdated September 17, 2004.
Hence, petitioners again filed a Petition for Certiorari and Prohibition13cralaw before the Court of Appeals,
docketed as CA-G.R. SP No. 87563, claiming that the trial court committed grave abuse of discretion in
allowing the amendment of the complaint to increase the amount of moral damages from P300,000.00
to P1,000,000.00. The case was raffled to the Seventeenth Division of the Court of Appeals.
On January 23, 2006, the Court of Appeals, Seventh Division, promulgated a decision in CA-G.R. SP No.
85465, as follows:
WHEREFORE, finding grave abuse of discretion on the part of [the] Regional Trial Court of Baguio,
Branch 60, in rendering the assailed Orders dated June 24, 2004 and July [19] , 2004 in Civil Case No.
5794-R the instant petition for certiorari is GRANTED. The assailed Orders are hereby ANNULLED and
SET ASIDE. Civil Case No. 5794-R for damages is ordered DISMISSED for lack of jurisdiction.
SO ORDERED.14cralaw
The Court of Appeals held that the case clearly falls under the jurisdiction of the MTCC as the allegations
show that plaintiff was seeking to recover moral damages in the amount of P300,000.00, which amount
was well within the jurisdictional amount of the MTCC. The Court of Appeals added that the totality of
claim rule used for determining which court had jurisdiction could not be applied to the instant case
because plaintiff's claim for exemplary damages was not a separate and distinct cause of action from her
claim of moral damages, but merely incidental to it. Thus, the prayer for exemplary damages should be
excluded in computing the total amount of the claim.
On January 31, 2006, the Court of Appeals, this time in CA-G.R. SP No. 87563, rendered a decision
affirming the September 17, 2004 Order of the RTC denying petitioners Motion to Dismiss Ad Cautelam .
In the said decision, the appellate court held that the total or aggregate amount demanded in the
complaint constitutes the basis of jurisdiction. The Court of Appeals did not find merit in petitioners
posture that the claims for exemplary damages and attorney's fees are merely incidental to the main
cause and should not be included in the computation of the total claim.
The Court of Appeals additionally ruled that respondent can amend her complaint by increasing the
amount of moral damages from P300,000.00 to P1,000,000.00, on the ground that the trial court has
jurisdiction over the original complaint and respondent is entitled to amend her complaint as a matter of
right under the Rules.
Unable to accept the decision, petitioners are now before us raising the following issues:
I.
WHETHER OR NOT THERE WAS GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR IN
EXCESS OF JURISDICTION ON THE PART OF THE (FORMER) SEVENTEENTH DIVISION OF THE
HONORABLE COURT OF APPEALS WHEN IT RESOLVED THAT THE REGIONAL TRIAL COURT OF
BAGUIO CITY BRANCH 60 HAS JURISDICTION OVER THE SUBJECT MATTER OF THE CASE FOR
DAMAGES AMOUNTING TO P300,000.00;
II.

WHETHER OR NOT THERE WAS GRAVE ABUSE OF DISCRETION ON THE PART OF THE
HONORABLE RESPONDENT JUDGE OF THE REGIONAL TRIAL COURT OF BAGUIO BRANCH 60
FOR ALLOWING THE COMPLAINANT TO AMEND THE COMPLAINT (INCREASING THE AMOUNT OF
DAMAGES TO 1,000,000.00 TO CONFER JURISDICTION OVER THE SUBJECT MATTER OF THE
CASE DESPITE THE PENDENCY OF A PETITION FOR CERTIORARI FILED AT THE COURT OF
APPEALS, SEVENTH DIVISION, DOCKETED AS CA G.R. NO. 85465. 15cralaw
In essence, the basic issues for our resolution are:
1) Did the RTC acquire jurisdiction over the case? and
2) Did the RTC commit grave abuse of discretion in allowing the amendment of the complaint?
Petitioners insist that the complaint falls under the exclusive jurisdiction of the MTCC. They maintain that
the claim for moral damages, in the amount of P300,000.00 in the original complaint, is the main action.
The exemplary damages being discretionary should not be included in the computation of the
jurisdictional amount. And having no jurisdiction over the subject matter of the case, the RTC acted with
grave abuse of discretion when it allowed the amendment of the complaint to increase the claim for moral
damages in order to confer jurisdiction.
In her Comment,16cralaw respondent averred that the nature of her complaint is for recovery of damages.
As such, the totality of the claim for damages, including the exemplary damages as well as the other
damages alleged and prayed in the complaint, such as attorney's fees and litigation expenses, should be
included in determining jurisdiction. The total claim being P420,000.00, the RTC has jurisdiction over the
complaint.
We deny the petition, which although denominated as a petition for certiorari , we treat as a petition for
review oncertiorari under Rule 45in view of the issues raised.
Section 19(8) of Batas Pambansa Blg. 129,17cralaw as amended by Republic Act No.
7691,18cralaw states:
SEC. 19. Jurisdiction in civil cases . Regional Trial Courts shall exercise exclusive original jurisdiction:
xxxx
(8) In all other cases in which the demand, exclusive of interest, damages of whatever kind, attorney's
fees, litigation expenses, and costs or the value of the property in controversy exceeds One hundred
thousand pesos (P100,000.00) or, in such other cases in Metro Manila, where the demand, exclusive of
the abovementioned items exceeds Two hundred thousand pesos (P200,000.00).
Section 5 of Rep. Act No. 7691 further provides:
SEC. 5. After five (5) years from the effectivity of this Act, the jurisdictional amounts mentioned in Sec.
19(3), (4), and (8); and Sec. 33(1) of Batas Pambansa Blg. 129 as amended by this Act, shall be adjusted
to Two hundred thousand pesos (P200,000.00). Five (5) years thereafter, such jurisdictional amounts
shall be adjusted further to Three hundred thousand pesos (P300,000.00): Provided, however , That in
the case of Metro Manila, the abovementioned jurisdictional amounts shall be adjusted after five (5) years
from the effectivity of this Act to Four hundred thousand pesos (P400,000.00).

Relatedly, Supreme Court Circular No. 21-99 was issued declaring that the first adjustment in
jurisdictional amount of first level courts outside of Metro Manila from P100,000.00 to P200,000.00 took
effect on March 20, 1999. Meanwhile, the second adjustment from P200,000.00 to P300,000.00 became
effective on February 22, 2004 in accordance with OCA Circular No. 65-2004 issued by the Office of the
Court Administrator on May 13, 2004.
Based on the foregoing, there is no question that at the time of the filing of the complaint on April 5, 2004,
the MTCC's jurisdictional amount has been adjusted to P300,000.00.
But where damages is the main cause of action, should the amount of moral damages prayed for in the
complaint be the sole basis for determining which court has jurisdiction or should the total amount of all
the damages claimed regardless of kind and nature, such as exemplary damages, nominal damages, and
attorney's fees, etc., be used?
In this regard, Administrative Circular No. 09-9419cralaw is instructive:
xxxx
2. The exclusion of the term "damages of whatever kind" in determining the jurisdictional amount under
Section 19 (8) and Section 33 (1) of B.P. Blg. 129, as amended by R.A. No. 7691, applies to cases where
the damages are merely incidental to or a consequence of the main cause of action. However, in cases
where the claim for damages is the main cause of action, or one of the causes of action, the amount of
such claim shall be considered in determining the jurisdiction of the court. (Emphasis ours.)
In the instant case, the complaint filed in Civil Case No. 5794-R is for the recovery of damages for the
alleged malicious acts of petitioners. The complaint principally sought an award of moral and exemplary
damages, as well as attorney's fees and litigation expenses, for the alleged shame and injury suffered by
respondent by reason of petitioners utterance while they were at a police station in Pangasinan. It is
settled that jurisdiction is conferred by law based on the facts alleged in the complaintsince the latter
comprises a concise statement of the ultimate facts constituting the plaintiff's causes of action. 20cralaw It
is clear, based on the allegations of the complaint, that respondent's main action is for damages. Hence,
the other forms of damages being claimed by respondent, e.g. , exemplary damages, attorney's fees and
litigation expenses, are not merely incidental to or consequences of the main action but constitute the
primary relief prayed for in the complaint.
In Mendoza v. Soriano ,21cralaw it was held that in cases where the claim for damages is the main cause
of action, or one of the causes of action, the amount of such claim shall be considered in determining the
jurisdiction of the court. In the said case, the respondent's claim of P929,000.06 in damages and P25,000
attorney's fees plus P500 per court appearance was held to represent the monetary equivalent for
compensation of the alleged injury. The Court therein held that the total amount of monetary claims
including the claims for damages was the basis to determine the jurisdictional amount.
Also, in Iniego v. Purganan ,22cralaw the Court has held:
The amount of damages claimed is within the jurisdiction of the RTC, since it is the claim for all kinds of
damages that is the basis of determining the jurisdiction of courts, whether the claims for damages arise
from the same or from different causes of action.
xxxx

Considering that the total amount of damages claimed was P420,000.00, the Court of Appeals was
correct in ruling that the RTC had jurisdiction over the case.
Lastly, we find no error, much less grave abuse of discretion, on the part of the Court of Appeals in
affirming the RTC's order allowing the amendment of the original complaint from P300,000.00
to P1,000,000.00 despite the pendency of a petition for certiorari filed before the Court of Appeals. While
it is a basic jurisprudential principle that an amendment cannot be allowed when the court has no
jurisdiction over the original complaint and the purpose of the amendment is to confer jurisdiction on the
court,23cralaw here, the RTC clearly had jurisdiction over the original complaint and amendment of the
complaint was then still a matter of right.24cralaw
WHEREFORE, the petition is DENIED, for lack of merit. The Decision and Resolution of the Court of
Appeals dated January 31, 2006 and June 23, 2006, respectively, are AFFIRMED. The Regional Trial
Court of Baguio City, Branch 60 is DIRECTED to continue with the trial proceedings in Civil Case No.
5794-R with deliberate dispatch.
No costs.
SO ORDERED.

II.
G.R. No. 164594, April 22, 2015
MICHAEL SEBASTIAN, Petitioner, v. ANNABEL LAGMAY NG, REPRESENTED BY HER ATTORNEYIN-FACT, ANGELITA LAGMAY, Respondent.
DECISION
BRION, J.:
We resolve the petition for review on certiorari,1 filed by petitioner Michael Sebastian (Michael), assailing
the March 31, 2004 Decision,2 and the July 15, 2004 Resolution3 of the Court of Appeals (CA) in CA-G.R.
SP No. 65450.
The CA decision reversed and set aside the decision of the Regional Trial Court (RTC) of Palayan City,
Branch 40, in SP. Proc. Case No. 0096-P.
Factual Background
Sometime in 1997, Angelita Lagmay (Angelita), acting as representative and attorney-in-fact of her
daughter Annabel Lagmay Ng (Annabel), filed a complaint before the Barangay Justice of Siclong, Laur,
Nueva Ecija. She sought to collect from Michael the sum of P350,000.00 that Annabel sent to Michael.
She claimed that Annabel and Michael were once sweethearts, and that they agreed to jointly invest their
financial resources to buy a truck. She alleged that while Annabel was working in Hongkong, Annabel
sent Michael the amount of P350,000.00 to purchase the truck. However, after Annabel and Michael's
relationship has ended, Michael allegedly refused to return the money to Annabel, prompting the latter to
bring the matter before the Barangay Justice.
On July 9, 1997, the parties entered into an amicable settlement, evidenced by a document denominated

as "kasunduan''4 wherein Michael agreed to pay Annabel the amount of P250,000.00 on specific dates.
The kasunduan was signed by Angelita (on behalf of Annabel), Michael, and the members of the pangkat
ng tagapagkasundo. The kasunduan reads:
KASUNDUAN
Nagkasundo ang dalawang panig na pagkayari ng labing apat na buwan (14 months) Simula ngayong
July 9, 1997 hanggang September 1998 ay kailangan ng maibigay ni Mr. Sebastian ang pera ni Ms.
Anabelle Lagmay.
At napagkasunduan ay dalawang hulog ang halagang P250,000.00 na pera ni Ms.Lagmay at Simula ng
pagbibigay ni Mr. Sebastian ay sa buwan ng September 1998.
At upang may katunayan ang lahat ng napag usapan ay lumagda sa ibaba nito at sa harap ng mga saksi
ngayong ika-9 ng Hulyo, 1997
Mrs. Angelita Lagmay - (Lagda)
Mr. Michael Sebastian - (Lagda)
Saksi: Kagawad Rolando Mendizabal - (Lagda)
Hepe Quirino Sapon - (Lagda)
Benjamin Sebastian - (Lagda)
Jun Roxas - (Lagda)
Angelita alleged that the kasunduan was not repudiated within a period of ten (10) days from the
settlement, in accordance with the Katarungang Pambarangay Law embodied in the Local Government
Code of 1991 [Republic Act (R.A.) No. 7160], and Section 14 of its Implementing Rules. When Michael
failed to honor the kasunduan, Angelita brought the matter back to the Barangay, but
the Barangay Captain failed to enforce the kasunduan, and instead, issued a Certification to File Action.
After about one and a half years from the date of the execution of the kasunduan or on January 15, 1999,
Angelita filed with the Municipal Circuit Trial Court (MCTC) of Laur and Gabaldon, Nueva Ecija, a Motion
for Execution of the kasunduan.
Michael moved for the dismissal of the Motion for Execution, citing as a ground Angelita's alleged
violation of Section 15, Rule 13 of the 1997 Rules of Civil Procedure.
On January 17, 2000, the MCTC rendered a decision5 in favor of Annabel, the dispositive portion of which
reads, as follows:
WHEREFORE, the plaintiff through counsel has satisfactorily proven by preponderance of evidence
based on Exhibits "A," "B," "C," "D," and "F," that defendant has obligation to the plaintiff in the amount
ofP250,000.00.
IN VIEW OF THE FOREGOING, the Motion for Execution filed by the plaintiff is hereby granted based on
Sec. 2, Rule 7 of the Implementing Rules and Regulations of Republic Act No. 7160, and therefore,
defendant is hereby ordered within 15 days upon receipt of this decision to pay the plaintiff the amount of
P250,000.00 as evidenced by the Kasunduan (Exhibit "C") with legal interests from July 9, 1997 until said
obligation is fully paid, and to pay attorney's fees for the plaintiffs counsel in the amount of P15,000.00
and to pay the cost of the suit.
SO ORDERED.
Michael filed an appeal with the RTC arguing that the MCTC committed grave abuse of discretion in

prematurely deciding the case. Michael also pointed out that a hearing was necessary for the petitioner to
establish the genuineness and due execution of the kasunduan.
The Regional Trial Court's Ruling
In its November 13, 2000 Decision,6 the RTC, Branch 40 of Palayan City upheld the MCTC decision,
finding Michael liable to pay Annabel the sum of P250,000.00. It held that Michael failed to assail the
validity of the kasunduan, or to adduce any evidence to dispute Annabel's claims or the applicability of the
Implementing Rules and Regulations of R.A. No. 7160. The dispositive portion of the decision reads:
WHEREFORE, the assailed Decision and Order of the lower court is hereby MODIFIED in that the
appellant is ordered to pay the appellee the amount of Two hundred Fifty Thousand pesos (P250,000.00)
plus twelve percent interest(12%) per annum from September, 1998 up to the time it is actually paid and
fifty Thousand Pesos(P50,000.00) representing attorney's fees.
Michael filed a Motion for Reconsideration arguing that: (i) an amicable settlement or arbitration award
can be enforced by the Lupon within six (6) months from date of settlement or after the lapse of six (6)
months, by ordinary civil action in the appropriate City or Municipal Trial Court and not by a mere Motion
for execution; and (ii) the MCTC does not have jurisdiction over the case since the amount of
P250,000.00 (as the subject matter of the kasunduan) is in excess of MCTC's jurisdictional amount of
P200,000.00.7
In its March 13, 2001 Order, the RTC granted Michael's Motion for Reconsideration, and ruled that there
is merit in the jurisdictional issue he raised. It dismissed Angelita's Motion for Execution, and set aside the
MCTC Decision. The dispositive portion of the said Order reads:
WHEREFORE, the Motion for Reconsideration is GRANTED. The Decision of the Court dated November
13, 2000 is hereby SET ASIDE. The Decision of the Municipal Trial Court of Laur, Nueva Ecija dated
January 17, 2000 is likewise SET ASIDE and the Motion for Execution of Kasunduan is DISMISSED, the
said court having had no jurisdiction to hear and decide the matter.8
Angelita moved for the reconsideration of the March 13, 2001 Order, but the motion was subsequently
denied. Aggrieved, she filed a Petition for Review9 with the CA.
The Court of Appeal's Ruling
On August 2, 2001, the CA initially dismissed the petition for review on a mere technical ground of failure
to attach the Affidavit of Service. Angelita moved for reconsideration, attaching in her motion the Affidavit
of Service. The CA granted the motion.
On March 31, 2004, the CA rendered its decision granting the petition, and reversing the RTC's decision.
The CA declared that the "appropriate local trial court" stated in Section 2, Rule VII of the Implementing
Rules of R.A. No. 7160 refers to the municipal trial courts. Thus, contrary to Michael's contention, the
MCTC has jurisdiction to enforce any settlement or arbitration award, regardless of the amount involved.
The CA also ruled that Michael's failure to repudiate the kasunduan in accordance with the procedure
prescribed under the Implementing Rules of R.A. No. 7160, rendered the kasunduan final. Hence,
Michael can no longer assail the kasunduan on the ground of forgery.
Michael moved to reconsider this decision, but the CA denied his motion in its resolution dated July 15,
2004. Hence, this petition.
The Petition
In the present petition for review on certiorari, Michael alleges that the kasunduan cannot be given the

force and effect of a final judgment because it did not conform to the provisions of theKatarungang
Pambarangay law embodied in Book III, Title One, Chapter 7 of R.A. No. 7160. He points out the
following irregularities in the kasunduan's, execution, and claims that the agreement forged between him
and Angelita was fictitious and simulated:
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)

there was no record of the complaint in the Barangay;

there was no notice of mediation sent to him;
there was no constitution of the Pangkat Ng Tagapagasundo;
the parties were never called upon to choose the three (3) members from among
theLupon members;
he had no participation in the execution of the kasunduan;
his signature in the kasunduan was forged;
he did not personally appear before the Barangay;
there was no attestation clause;
the kasunduan was neither reported nor filed before the MCTC; and
Annabel, the real party in interest, did not personally appear before the Barangay as required
by the law.

Michael additionally claims that the kasunduan is merely in the nature of a private document. He also
reiterates that since the amount of P250,000.00 - the subject matter of the kasunduan - is in excess of
MCTC's jurisdictional amount of P200,000.00, the kasunduan is beyond the MCTC's jurisdiction to hear
and to resolve. Accordingly, the proceedings in the Barangay are all nullity.
The Issues
The issues to be resolved in the present petition are:
1. Whether or not the MCTC has the authority and jurisdiction to execute the kasunduanregardless
of the amount involved;
2. Whether or not the kasunduan could be given the force and effect of a final judgment; and
3. Whether or not the kasunduan can be enforced.

The Court's Ruling

We deny the petition.
A perusal of the body of the motion for
execution shows that it is actually in the
nature of an action for execution; hence,
it was a proper remedy;
We note at the outset that Michael raised - in his brief before the C A - the issue of wrong remedy. He
alleged that Angelita's recourse should have been to file a civil action, not a mere motion for execution, in
a regular court. However, the CA failed to address this issue and only ruled on the issues of
the kasunduan's irregularities and the MCTC's jurisdiction.
A simple reading of Section 417 of the Local Government Code readily discloses the two-tiered mode of
enforcement of an amicable settlement. The provision reads:

Section 417. Execution. - The amicable settlement or arbitration award may be enforced by execution by
the lupon within six (6) months from the date of the settlement. After the lapse of such time, the settlement
may be enforced by action in the appropriate city or municipal court. [Emphasis ours.]
Under this provision, an amicable settlement or arbitration award that is not repudiated within a period
often (10) days from the settlement may be enforced by: first, execution by the Lupon within six (6)
months from the date of the settlement; or second, by an action in the appropriate city or municipal trial
court if more than six (6) months from the date of settlement has already elapsed.
Under the first mode of enforcement, the execution of an amicable settlement could be done on mere
motion of the party entitled thereto before the Punong Barangay.10 The proceedings in this case are
summary in nature and are governed by the Local Government Code and the Katarungang
Pambarangay Implementing Rules and Regulations.
The second mode of enforcement, on the other hand, is judicial in nature and could only be resorted to
through the institution of an action in a regular form before the proper City/Municipal Trial Court.11 The
proceedings shall be governed by the provisions of the Rules of Court.
Indisputably, Angelita chose to enforce the kasunduan under the second mode and filed a motion for
execution, which was docketed as Special Proceedings No. 45-99. The question for our resolution
is:Whether the MCTC, through Angelita's motion for execution, is expressly authorized to enforce the
kasunduan under Section 417 of the Local Government Code?
The Court rules in the affirmative.
It is undisputed that what Angelita filed before the MCTC was captioned "motion for execution," rather
than a petition/complaint for execution.
A perusal of the motion for execution, however, shows that it contains the material requirements of an
initiatory action.
First, the motion is sufficient in form12 and substance.13 It is complete with allegations of the ultimate facts
constituting the cause of action; the names and residences of the plaintiff and the defendant; it contains
the prayer for the MCTC to order the execution of the kasunduan; and there was also a verification and
certification against forum shopping.
Furthermore, attached to the motion are: 1) the authenticated special power of attorney of Annabel,
authorizing Angelita to file the present action on her behalf; and 2) the copy of the kasunduan whose
contents were quoted in the body of the motion for execution.
It is well-settled that what are controlling in determining the nature of the pleading are the allegations in
the body and not the caption.14
Thus, the motion for execution that Angelita filed was intended to be an initiatory pleading or an
original action that is compliant with the requirement under Section 3, Rule 6 of the Rules of Court
that the complaint should allege the plaintiffs cause of action and the names and residences of
the plaintiff and the defendant.
Angelita's motion could therefore be treated as an original action, and not merely as a
motion/special proceeding. For this reason, Annabel has filed the proper remedy prescribed under
Section 417 of the Local Government Code.
However, Angelita should pay the proper docket fees corresponding to the filing of an action for execution.
The docket fees shall be computed by the Clerk of Court of the MCTC, with due consideration, of course,
of what Angelita had already paid when her motion for execution was docketed as a special proceeding.

The kasunduan has the force and effect of a final judgment.

Under Section 416 of the Local Government Code, the amicable settlement and arbitration award shall
have the force and effect of a final judgment of a court upon the expiration often (10) days from the date
of its execution, unless the settlement or award has been repudiated or a petition to nullify the award has
been filed before the proper city or municipal court.
Moreover, Section 14, Rule VI of the Katarungang Pambarangay Implementing Rules states that the
party's failure to repudiate the settlement within the period often (10) days shall be deemed a waiver of
the right to challenge the settlement on the ground that his/her consent was vitiated by fraud, violence or
intimidation.
In the present case, the records reveal that Michael never repudiated the kasunduan within the period
prescribed by the law. Hence, the CA correctly ruled that the kasunduan has the force and effect of a final
judgment that is ripe for execution.
Furthermore, the irregularities in the kasunduan's execution, and the claim of forgery are deemed waived
since Michael never raised these defenses in accordance with the procedure prescribed under the Local
Government Code. Thus, we see no reason to discuss these issues in the present case.
The MCTC has the authority and jurisdiction
to enforce the kasunduan regardless of the amount involved.
The Court also finds that the CA correctly upheld the MCTC's jurisdiction to enforce any settlement or
arbitration .award issued by the Lupon.
We again draw attention to the provision of Section 417 of the Local Government Code that after the
lapse of the six (6) month period from the date of the settlement, the agreement may be enforced by
action in the appropriate city or municipal court.
The law, as written, unequivocally speaks of the "appropriate city or municipal court" as the forum for the
execution of the settlement or arbitration award issued by the Lupon. Notably, in expressly conferring
authority over these courts, Section 417 made no distinction with respect to the amount involved or the
nature of the issue involved. Thus, there can be no question that the law's intendment was to grant
jurisdiction over the enforcement of settlement/arbitration awards to the city or municipal
courts regardless of the amount. A basic principle of interpretation is that words must be given their literal
meaning and applied without attempted interpretation where the words of a statute are clear,' plain and
free from ambiguity.15
WHEREFORE, premises considered, we hereby DENY the petitioner's petition for review oncertiorari,
and AFFIRM the March 31, 2004 Decision of the Court of Appeals in CA-G.R. SP No. 65450.
Angelita Lagmay is ORDERED to pay the proper docket fees to be computed by the Clerk of Court of the
Municipal Circuit Trial Court of Laur and Gabaldon, Nueva Ecija, with due consideration of what she had
paid when her motion for execution was docketed as a special proceeding.
SO ORDERED.

III.
G.R. No. 176492, October 20, 2014
MARIETTA N. BARRIDO, Petitioner, v. LEONARDO V. NONATO, Respondent.

DECISION
PERALTA, J.:
For the Courts resolution is a Petition for Review filed by petitioner Marietta N. Barrido questioning the
Decision1 of the Court of Appeals (CA), dated November 16, 2006, and its Resolution 2 dated January 24,
2007 in CA-G.R. SP No. 00235. The CA affirmed the Decision3 of the Regional Trial Court (RTC) of
Bacolod City, Branch 53, dated July 21, 2004, in Civil Case No. 03-12123, which ordered the partition of
the subject property.
The facts, as culled from the records, are as follows:chanRoblesvirtualLawlibrary
In the course of the marriage of respondent Leonardo V. Nonato and petitioner Marietta N. Barrido, they
were able to acquire a property situated in Eroreco, Bacolod City, consisting of a house and lot, covered
by Transfer Certificate of Title (TCT) No. T-140361. On March 15, 1996, their marriage was declared void
on the ground of psychological incapacity. Since there was no more reason to maintain their coownership over the property, Nonato asked Barrido for partition, but the latter refused. Thus, on January
29, 2003, Nonato filed a Complaint for partition before the Municipal Trial Court in Cities (MTCC) of
Bacolod City, Branch 3.
Barrido claimed, by way of affirmative defense, that the subject property had already been sold to their
children, Joseph Raymund and Joseph Leo. She likewise moved for the dismissal of the complaint
because the MTCC lacked jurisdiction, the partition case being an action incapable of pecuniary
estimation.
The Bacolod MTCC rendered a Decision dated September 17, 2003, applying Article 129 of the Family
Code. It ruled in this wise:chanRoblesvirtualLawlibrary
WHEREFORE, PREMISES CONSIDERED, judgment is hereby rendered, ordering the conjugal property
of the former Spouses Leonardo and Marietta Nonato, a house and lot covered by TCT No. T-140361
located at Eroreco, Bacolod City, which was their conjugal dwelling, adjudicated to the defendant Marietta
Nonato, the spouse with whom the majority of the common children choose to remain.
Furthermore, defendants counterclaim is hereby granted, ordering plaintiff to pay defendant P10,000.00
as moral damages for the mental anguish and unnecessary inconvenience brought about by this suit; and
an additional P10,000.00 as exemplary damages to deter others from following suit; and attorneys fees of
P2,000.00 and litigation expenses of P575.00.
SO ORDERED.4
Nonato appealed the MTCC Decision before the RTC. On July 21, 2004, the Bacolod RTC reversed the
ruling of the MTCC. It found that even though the MTCC aptly applied Article 129 of the Family Code, it
nevertheless made a reversible error in adjudicating the subject property to Barrido. Its dispositive portion
reads:chanRoblesvirtualLawlibrary
WHEREFORE, premises considered, the decision dated September 17, 2003 is hereby REVERSED and
SET ASIDE and a new judgment is hereby rendered ordering the parties:chanRoblesvirtualLawlibrary
(1) to equitably partition the house and lot covered by TCT No. T-140361;
(2) to reimburse Joseph Raymund and Joseph Leo Nonato of the amount advanced by them in payment
of the debts and obligation of TCT No. T-140361 with Philippine National Bank;
(3) to deliver the presumptive legitimes of Joseph Raymund and Joseph Leo Nonato pursuant to Article
51 of the Family Code.
SO ORDERED.5chanrobleslaw

Upon appeal, the CA affirmed the RTC Decision on November 16, 2006. It held that since the propertys
assessed value was only P8,080.00, it clearly fell within the MTCCs jurisdiction. Also, although the RTC
erred in relying on Article 129 of the Family Code, instead of Article 147, the dispositive portion of its
decision still correctly ordered the equitable partition of the property. Barrido filed a Motion for
Reconsideration, which was, however, denied for lack of merit.
Hence, Barrido brought the case to the Court via a Petition for Review. She assigned the following errors
in the CA Decision:chanRoblesvirtualLawlibrary
I.
THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT THE MTCC HAD JURISDICTION
TO TRY THE PRESENT CASE.
II.
THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT THE LOT COVERED BY TCT
NO. T-140361 IS CONJUGAL AFTER BEING SOLD TO THE CHILDREN, JOSEPH LEO NONATO AND
JOSEPH RAYMUND NONATO.
III.
THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT ARTICLE 129 OF THE FAMILY
CODE HAS NO APPLICATION IN THE PRESENT CASE, ON THE ASSUMPTION THAT THE TRIAL
COURT HAD JURISDICTION OVER THE CASE.6chanrobleslaw
The petition lacks merit.
Contrary to Barridos contention, the MTCC has jurisdiction to take cognizance of real actions or those
affecting title to real property, or for the recovery of possession, or for the partition or condemnation of, or
foreclosure of a mortgage on real property.7 Section 33 of Batas Pambansa Bilang
1298 provides:chanRoblesvirtualLawlibrary
Section 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:chanroblesvirtuallawlibrary
xxxx
(3) Exclusive original jurisdiction in all civil actions which involve title to, or possession of, real
property, or any interest therein where theassessed 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 value of such property shall be
determined by the assessed value of the adjacent lots. (as amended by R.A. No. 7691) 9
Here, the subject propertys assessed value was merely P8,080.00, an amount which certainly does not
exceed the required limit of P20,000.00 for civil actions outside Metro Manila to fall within the jurisdiction
of the MTCC. Therefore, the lower court correctly took cognizance of the instant case.
The records reveal that Nonato and Barridos marriage had been declared void for psychological
incapacity under Article 3610 of the Family Code. During their marriage, however, the conjugal partnership
regime governed their property relations. Although Article 12911 provides for the procedure in case of
dissolution of the conjugal partnership regime, Article 147 specifically covers the effects of void marriages
on the spouses property relations. Article 147 reads:chanRoblesvirtualLawlibrary

Art. 147. When a man and a woman who are capacitated to marry each other, live exclusively with each
other as husband and wife without the benefit of marriage or under a void marriage, their wages and
salaries shall be owned by them in equal shares and the property acquired by both of them through their
work or industry shall be governed by the rules on co-ownership.
In the absence of proof to the contrary, properties acquired while they lived together shall be presumed to
have been obtained by their joint efforts, work or industry, and shall be owned by them in equal shares.
For purposes of this Article, a party who did not participate in the acquisition by the other party of any
property shall be deemed to have contributed jointly in the acquisition thereof if the former's efforts
consisted in the care and maintenance of the family and of the household.
Neither party can encumber or dispose by acts inter vivos of his or her share in the property acquired
during cohabitation and owned in common, without the consent of the other, until after the termination of
their cohabitation.
When only one of the parties to a void marriage is in good faith, the share of the party in bad faith in the
co-ownership shall be forfeited in favor of their common children. In case of default of or waiver by any or
all of the common children or their descendants, each vacant share shall belong to the respective
surviving descendants. In the absence of descendants, such share shall belong to the innocent party. In
all cases, the forfeiture shall take place upon termination of the cohabitation.
This particular kind of co-ownership applies when a man and a woman, suffering no illegal impediment to
marry each other, exclusively live together as husband and wife under a void marriage or without the
benefit of marriage.12 It is clear, therefore, that for Article 147 to operate, the man and the woman: (1)
must be capacitated to marry each other; (2) live exclusively with each other as husband and wife; and (3)
their union is without the benefit of marriage or their marriage is void. Here, all these elements are
present.13 The term "capacitated" in the first paragraph of the provision pertains to the legal capacity of a
party to contract marriage.14 Any impediment to marry has not been shown to have existed on the part of
either Nonato or Barrido. They lived exclusively with each other as husband and wife. However, their
marriage was found to be void under Article 36 of the Family Code on the ground of psychological
incapacity.15cralawlawlibrary
Under this property regime, property acquired by both spouses through their work and industry shall be
governed by the rules on equal co-ownership. Any property acquired during the union is prima
facie presumed to have been obtained through their joint efforts. A party who did not participate in the
acquisition of the property shall be considered as having contributed to the same jointly if said party's
efforts consisted in the care and maintenance of the family household. 16 Efforts in the care and
maintenance of the family and household are regarded as contributions to the acquisition of common
property by one who has no salary or income or work or industry.17cralawlawlibrary
In the analogous case of Valdez,18 it was likewise averred that the trial court failed to apply the correct law
that should govern the disposition of a family dwelling in a situation where a marriage is declared void ab
initio because of psychological incapacity on the part of either or both parties in the contract of marriage.
The Court held that the court a quo did not commit a reversible error in utilizing Article 147 of the Family
Code and in ruling that the former spouses own the family home and all their common property in equal
shares, as well as in concluding that, in the liquidation and partition of the property that they owned in
common, the provisions on co-ownership under the Civil Code should aptly prevail. 19 The rules which
are set up to govern the liquidation of either the absolute community or the conjugal partnership of gains,
the property regimes recognized for valid and voidable marriages, are irrelevant to the liquidation of the
co-ownership that exists between common-law spouses or spouses of void marriages. 20cralawlawlibrary
Here, the former spouses both agree that they acquired the subject property during the subsistence of
their marriage. Thus, it shall be presumed to have been obtained by their joint efforts, work or industry,
and shall be jointly owned by them in equal shares. Barrido, however, claims that the ownership over the
property in question is already vested on their children, by virtue of a Deed of Sale. But aside from the

title to the property still being registered in the names of the former spouses, said document of sale does
not bear a notarization of a notary public. It must be noted that without the notarial seal, a document
remains to be private and cannot be converted into a public document, 21 making it inadmissible in
evidence unless properly authenticated.22 Unfortunately, Barrido failed to prove its due execution and
authenticity. In fact, she merely annexed said Deed of Sale to her position paper. Therefore, the subject
property remains to be owned in common by Nonato and Barrido, which should be divided in accordance
with the rules on co-ownership.
WHEREFORE, premises considered, the petition is DENIED. The Decision of the Court of Appeals,
dated November 16, 2006, as well as its Resolution dated January 24, 2007 in CA-G.R. SP No. 00235,
are hereby AFFIRMED.
SO ORDERED.cralawred
IV.
[G.R. No. 138896. June 20, 2000.]
BARANGAY SAN ROQUE, TALISAY, CEBU, Petitioner, v. Heirs of FRANCISCO PASTOR, namely:
EUGENIO SYLIANCO, TEODORO SYLIANCO, ISABEL SYLIANCO, EUGENIA S. ONG, LAWRENCE
SYLIANCO, LAWSON SYLIANCO, LAWINA S. NOTARIO, LEONARDO SYLIANCO, JR. and
LAWFORD SYLIANCO, Respondents.
DECISION
PANGANIBAN, J.:
An expropriation suit is incapable of pecuniary estimation. Accordingly, it falls within the jurisdiction of the
regional trial courts, regardless of the value of the subject property.
The Case
Before us is a Petition for Review on Certiorari assailing the March 29, 1999 Order 1 of the Regional Trial
Court (RTC) of Cebu City (Branch 58) in Civil Case No. CEB-21978, in which it dismissed a Complaint for
eminent domain. It ruled as follows:chanrobles virtuallawlibrary
"Premises considered, the motion to dismiss is hereby granted on the ground that this Court has no
jurisdiction over the case. Accordingly, the Orders dated February 19, 1999 and February 26, 1999, as
well as the Writ of Possession issued by virtue of the latter Order are hereby recalled for being without
force and effect." 2
Petitioner also challenges the May 14, 1999 Order of the RTC denying reconsideration.
The Facts
Petitioner filed before the Municipal Trial Court (MTC) of Talisay, Cebu (Branch 1) 3 a Complaint to
expropriate a property of the respondents. In an Order dated April 8, 1997, the MTC dismissed the
Complaint on the ground of lack of jurisdiction. It reasoned that" [e]minent domain is an exercise of the
power to take private property for public use after payment of just compensation. In an action for eminent
domain, therefore, the principal cause of action is the exercise of such power or right. The fact that the
action also involves real property is merely incidental. An action for eminent domain is therefore within the

exclusive original jurisdiction of the Regional Trial Court and not with this Court." 4
Assailed RTC Ruling
The RTC also dismissed the Complaint when filed before it, holding that an action for eminent domain
affected title to real property; hence, the value of the property to be expropriated would determine whether
the case should be filed before the MTC or the RTC. Concluding that the action should have been filed
before the MTC since the value of the subject property was less than P20,000, the RTC ratiocinated in
this wise:jgc:chanrobles.com.ph
"The instant action is for eminent domain. It appears from the current Tax declaration of the land involved
that its assessed value is only One Thousand Seven Hundred Forty Pesos (P1,740.00). Pursuant to
Section 3, paragraph (3), of Republic Act No. 7691, all civil actions involving title to, or possession of, real
property with an assessed value of less than P20,000.00 are within the exclusive original jurisdiction of
the Municipal Trial Courts. In the case at bar, it is within the exclusive original jurisdiction of the Municipal
Trial Court of Talisay, Cebu, where the property involved is located.
"The instant action for eminent domain or condemnation of real property is a real action affecting title to or
possession of real property, hence, it is the assessed value of the property involved which determines the
jurisdiction of the court. That the right of eminent domain or condemnation of real property is included in a
real action affecting title to or possession of real property, is pronounced by retired Justice Jose Y. Feria,
thus, Real actions are those affecting title to or possession of real property. These include partition or
condemnation of, or foreclosures of mortgage on, real property. . . ." 5
Aggrieved, petitioner appealed directly to this Court, raising a pure question of law. 6 In a Resolution
dated July 28, 1999, the Court denied the Petition for Review "for being posted out of time on July 2,
1999, the due date being June 2, 1999, as the motion for extension of time to file petition was denied in
the resolution of July 14, 1999." 7 In a subsequent Resolution dated October 6, 1999, the Court reinstated
the Petition. 8
Issue
In its Memorandum, petitioner submits this sole issue for the consideration of this
Court:jgc:chanrobles.com.ph
"Which court, MTC or RTC, has jurisdiction over cases for eminent domain or expropriation where the
assessed value of the subject property is below Twenty Thousand (P20,000.00) Pesos?" 9
This Courts Ruling
The Petition is meritorious.
Main Issue: Jurisdiction over an Expropriation Suit
In support of its appeal, petitioner cites Section 19 (1) of BP 129, which provides that RTCs shall exercise
exclusive original jurisdiction over "all civil actions in which the subject of the litigation is incapable of
pecuniary estimation; . . . ." It argues that the present action involves the exercise of the right to eminent
domain, and that such right is incapable of pecuniary estimation.
Respondents, on the other hand, contend that the Complaint for Eminent Domain affects the title to or
possession of real property. Thus, they argue that the case should have been brought before the MTC,
pursuant to BP 129 as amended by Section 3 (3) of RA 7691. This law provides that MTCs shall have
exclusive original jurisdiction over all civil actions that involve title to or possession of real property, the
assessed value of which does not exceed twenty thousand pesos or, in civil actions in Metro Manila, fifty
thousand pesos exclusive of interest, damages of whatever kind, attorneys fees, litigation expenses and

Costs.
We agree with the petitioner that an expropriation suit is incapable of pecuniary estimation. The test to
determine whether it is so was laid down by the Court in this wise:jgc:chanrobles.com.ph
"A review of the jurisprudence of this Court indicates 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 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 money, or where the money claim is
purely incidental to, or a consequence of, the principal relief sought, like in suits to have the defendant
perform his part of the contract (specific performance) and in actions for support, or for annulment of a
judgment or to foreclose a mortgage, 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. The rationale of the rule is plainly that the second class cases, besides the determination of
damages, demand an inquiry into other factors which the law has deemed to be more within the
competence of courts of first instance, which were the lowest courts of record at the time that the first
organic laws of the Judiciary were enacted allocating jurisdiction (Act 136 of the Philippine Commission of
June 11, 1901)." 10
In the present case, an expropriation suit does not involve the recovery of a sum of money. Rather, it
deals with the exercise by the government of its authority and right to take private property for public use.
11 In National Power Corporation v. Jocson, 12 the Court ruled that expropriation proceedings have two
phases:jgc:chanrobles.com.ph
"The first is concerned with the determination of the authority of the plaintiff to exercise the power of
eminent domain and the propriety of its exercise in the context of the facts involved in the suit. It ends with
an order, if not of dismissal of the action, of condemnation declaring that the plaintiff has a lawful right to
take the property sought to be condemned, for the public use or purpose described in the complaint, upon
the payment of just compensation to be determined as of the date of the filing of the complaint. An order
of dismissal, if this be ordained, would be a final one, of course, since it finally disposes of the action and
leaves nothing more to be done by the Court on the merits. So, too, would an order of condemnation be a
final one, for thereafter as the Rules expressly state, in the proceedings before the Trial Court, no
objection to the exercise of the right of condemnation (or the propriety thereof) shall be filed or heard.
"The second phase of the eminent domain action is concerned with the determination by the court of the
just compensation for the property sought to be taken. This is done by the Court with the assistance of
not more than three (3) commissioners. The order fixing the just compensation on the basis of the
evidence before, and findings of, the commissioners would be final, too. It would finally dispose of the
second stage of the suit, and leave nothing more to be done by the Court regarding the issue. . . ."
It should be stressed that the primary consideration in an expropriation suit is whether the government or
any of its instrumentalities has complied with the requisites for the taking of private property. Hence, the
courts determine the authority of the government entity, the necessity of the expropriation, and the
observance of due process. 13 In the main, the subject of an expropriation suit is the governments
exercise of eminent domain, a matter that is incapable of pecuniary estimation.
True, the value of the property to be expropriated is estimated in monetary terms, for the court is dutybound to determine the just compensation for it. This, however, is merely incidental to the expropriation
suit. Indeed, that amount is determined only after the court is satisfied with the propriety of the
expropriation.
Verily, the Court held in Republic of the Philippines v. Zurbano that "condemnation proceedings are within
the jurisdiction of Courts of First Instance," 14 the forerunners of the regional trial courts. The said case
was decided during the effectivity of the Judiciary Act of 1948 which, like BP 129 in respect to RTCs,

provided that courts of first instance had original jurisdiction over "all civil actions in which the subject of
the litigation is not capable of pecuniary estimation." 15 The 1997 amendments to the Rules of Court were
not intended to change these jurisprudential precedents.chanrobles.com : red
We are not persuaded by respondents argument that the present action involves the title to or possession
of a parcel of land. They cite the observation of retired Justice Jose Y. Feria, an eminent authority in
remedial law, that condemnation or expropriation proceedings are examples of real actions that affect the
title to or possession of a parcel of land. 16
Their reliance is misplaced. Justice Feria sought merely to distinguish between real and personal actions.
His discussion on this point pertained to the nature of actions, not to the jurisdiction of courts. In fact, in
his pre-bar lectures, he emphasizes that jurisdiction over eminent domain cases is still within the RTCs
under the 1997 Rules.
To emphasize, the question in the present suit is whether the government may expropriate private
property under the given set of circumstances. The government does not dispute respondents title to or
possession of the same. Indeed, it is not a question of who has a better title or right, for the government
does not even claim that it has a title to the property. It merely asserts its inherent sovereign power to
"appropriate and control individual property for the public benefit, as the public necessity, convenience or
welfare may demand." 17chanroblesvirtuallawlibrary
WHEREFORE, the Petition is hereby GRANTED and the assailed Orders SET ASIDE. The Regional Trial
Court is directed to HEAR the case. No costs.
SO ORDERED.
Melo, Purisima, and Gonzaga-Reyes, JJ., concur.
Vitug, J., on leave for official business.
V.
G.R. No. 202664, November 20, 2015
MANUEL LUIS C. GONZALES AND FRANCIS MARTIN D. GONZALES, Petitioners, v. GJH LAND,
INC. (FORMERLY KNOWN AS S.J. LAND, INC.), CHANG HWAN JANG A.K.A. STEVE JANG, SANG
RAK KIM, MARIECHU N. YAP, AND ATTY. ROBERTO P. MALLARI II, Respondent.
DECISION
PERLAS-BERNABE, J.:
This is a direct recourse to the Court, via a petition for review on certiorari,1 from the Orders dated April
17, 20122 and July 9, 20123 of the Regional Trial Court (RTC) of Muntinlupa City, Branch 276 (Branch
276) dismissing Civil Case No. 11-077 for lack of jurisdiction.
The Facts
On August 4, 2011, petitioners Manuel Luis C. Gonzales4 and Francis Martin D. Gonzales (petitioners)
filed a Complaint5 for "Injunction with prayer for Issuance of Status Quo Order, Three (3) and Twenty (20)Day Temporary Restraining Orders, and Writ of Preliminary Injunction with Damages" against
respondents GJH Land, Inc. (formerly known as S.J. Land, Inc.), Chang Hwan Jang, Sang Rak Kim,
Mariechu N. Yap, and Atty. Roberto P. Mallari II6 (respondents) before the RTC of Muntinlupa City seeking
to enjoin the sale of S.J. Land, Inc.'s shares which they purportedly bought from S.J. Global, Inc. on

February 1, 2010. Essentially, petitioners alleged that the subscriptions for the said shares were already
paid by them in full in the books of S.J. Land, Inc., 7 but were nonetheless offered for sale on July 29, 2011
to the corporation's stockholders,8 hence, their plea for injunction.
The case was docketed as Civil Case No. 11-077 and raffled to Branch 276, which is not a Special
Commercial Court. On August 9, 2011, said branch issued a temporary restraining order,9and later, in an
Order10 dated August 24, 2011, granted the application for a writ of preliminary injunction.
After filing their respective answers11 to the complaint, respondents filed a motion to dismiss 12 on the
ground of lack of jurisdiction over the subject matter, pointing out that the case involves an intra-corporate
dispute and should, thus, be heard by the designated Special Commercial Court of Muntinlupa City.13
The RTC Ruling
In an Order14 dated April 17, 2012, Branch 276 granted the motion to dismiss filed by respondents. It
found that the case involves an intra-corporate dispute that is within the original and exclusive jurisdiction
of the RTCs designated as Special Commercial Courts. It pointed out that the RTC of Muntinlupa City,
Branch 256 (Branch 256) was specifically designated by the Court as the Special Commercial Court,
hence, Branch 276 had no jurisdiction over the case and cannot lawfully exercise jurisdiction on the
matter, including the issuance of a Writ of Preliminary Injunction. 15 Accordingly, it dismissed the case.
Dissatisfied, petitioners filed a motion for reconsideration, 16 arguing that they filed the case with the Office
of the Clerk of Court of the RTC of Muntinlupa City which assigned the same to Branch 276 byraffle.17 As
the raffle was beyond their control, they should not be made to suffer the consequences of the wrong
assignment of the case, especially after paying the filing fees in the amount of P235,825.00 that would be
for naught if the dismissal is upheld.18 They further maintained that the RTC has jurisdiction over intracorporate disputes under Republic Act No. (RA) 8799,19 but since the Court selected specific branches to
hear and decide such suits, the case must, at most, be transferred or raffled off to the proper branch. 20
In an Order21 dated July 9, 2012, Branch 276 denied the motion for reconsideration, holding that it has no
authority or power to order the transfer of the case to the proper Special Commercial Court, citing Calleja
v. Panday22 (Calleja); hence, the present petition.
The Issue Before the Court
The essential issue for the Court's resolution is whether or not Branch 276 of the RTC of Muntinlupa City
erred in dismissing the case for lack of jurisdiction over the subject matter.
The Court's Ruling
The petition is meritorious.
At the outset, the Court finds Branch 276 to have correctly categorized Civil Case No. 11-077 as a
commercial case, more particularly, an intra-corporate dispute, 23 considering that it relates to petitioners'
averred rights over the shares of stock offered for sale to other stockholders, having paid the same in full.
Applying the relationship test and the nature of the controversy test, the suit between the parties is clearly
rooted in the existence of an intra-corporate relationship and pertains to the enforcement of their
correlative rights and obligations under the Corporation Code and the internal and intra-corporate
regulatory rules of the corporation,24 hence, intra-corporate, which should be heard by the designated
Special Commercial Court as provided under A.M. No. 03-03-03-SC25 dated June 17, 2003 in relation to
Item 5.2, Section 5 of RA 8799.
The present controversy lies, however, in the procedure to be followed when a commercial case - such
as the instant intra-corporate dispute -has been properly filed in the official station of the
designated Special Commercial Court but is, however, later wrongly assigned by raffle to a regular

branch of that station.

As a basic premise, let it be emphasized that a court's acquisition of jurisdiction over a particular case's
subject matter is different from incidents pertaining to the exercise of its jurisdiction. Jurisdiction over the
subject matter of a case is conferred by law, whereas a court's exercise of jurisdiction, unless
provided by the law itself, is governed by the Rules of Court or by the orders issued from time to time by
the Court.26 In Lozada v. Bracewell,27 it was recently held that the matter of whether the RTC resolves
an issue in the exercise of its general jurisdiction or of its limited jurisdiction as a special court
is only a matter of procedure and has nothing to do with the question of jurisdiction.
Pertinent to this case is RA 8799 which took effect on August 8, 2000. By virtue of said law, jurisdiction
over cases enumerated in Section 528 of Presidential Decree No. 902-A29 was transferred from the
Securities and Exchange Commission (SEC) to the RTCs, being courts of general jurisdiction. Item
5.2, Section 5 of RA 8799 provides:chanRoblesvirtualLawlibrary
SEC. 5. Powers and Functionsof the Commission. - x x x
xxxx
5.2 The Commission's jurisdiction over all cases enumerated under Section 5 of Presidential
Decree No. 902-A is hereby transferred to the Courts of general jurisdiction or the appropriate
Regional Trial Court: Provided, that the Supreme Court in the exercise of its authority may
designate the Regional Trial Court branches that shall exercise jurisdiction over the cases. The
Commission shall retain jurisdiction over pending cases involving intra-corporate disputes submitted for
final resolution which should be resolved within one (1) year from the enactment of this Code. The
Commission shall retain jurisdiction over pending suspension of payments/rehabilitation cases filed as of
30 June 2000 until finally disposed. (Emphasis supplied)cralawlawlibrary
The legal attribution of Regional Trial Courts as courts of general jurisdiction stems from Section 19
(6), Chapter II of Batas Pambansa Bilang (BP) 129, 30 known as "The Judiciary Reorganization Act of
1980":chanRoblesvirtualLawlibrary
Section 19. Jurisdiction in civil cases.- Regional Trial Courts shall exercise exclusive original
jurisdiction:chanRoblesvirtualLawlibrary
xxxx
(6) In all cases not within the exclusive jurisdiction of any court, tribunal, person or body exercising
jurisdiction or any court, tribunal, person or body exercising judicial or quasi-judicial functions; x x x x
cralawlawlibrary
As enunciated in Durisol Philippines, Inc. v. CA:31chanroblesvirtuallawlibrary
The regional trial court, formerly the court of first instance, is a court of general jurisdiction. All cases, the
jurisdiction over which is not specifically provided for by law to be within the jurisdiction of any other court,
fall under the jurisdiction of the regional trial court. 32ChanRoblesVirtualawlibrary
cralawlawlibrary
To clarify, the word "or" in Item 5.2, Section 5 of RA 8799 was intentionally used by the legislature to
particularize the fact that the phrase "the Courts of general jurisdiction" is equivalent to the phrase "the
appropriate Regional Trial Court." In other words, the jurisdiction of the SEC over the cases enumerated
under Section 5 of PD 902-A was transferred to the courts of general jurisdiction, that is to say (or,
otherwise known as), the proper Regional Trial Courts. This interpretation is supported bySan Miguel
Corp. v. Municipal Council,33 wherein the Court held that:chanRoblesvirtualLawlibrary

[T]he word "or" may be used as the equivalent of "that is to say" and gives that which precedes it the
same significance as that which follows it. It is not always disjunctive and is sometimes interpretative or
expository of the preceding word.34cralawlawlibrary
Further, as may be gleaned from the following excerpt of the Congressional
deliberations:chanRoblesvirtualLawlibrary
Senator [Raul S.] Roco: x x x.
xxxx
x x x. The first major departure is as regards the Securities and Exchange Commission. The Securities
and Exchange Commission has been authorized under this proposal to reorganize itself. As an
administrative agency, we strengthened it and at the same time we take away the quasi-judicial
functions. The quasi-judicial functions are now given back to the courts of general jurisdiction - the
Regional Trial Court, except for two categories of cases.
In the case of corporate disputes, only those that are now submitted for final determination of the SEC will
remain with the SEC. So, all those cases, both memos of the plaintiff and the defendant, that have been
submitted for resolution will continue. At the same time, cases involving rehabilitation, bankruptcy,
suspension of payments and receiverships that were filed before June 30, 2000 will continue with the
SEC. in other words, we are avoiding the possibility, upon approval of this bill, of people filing cases with
the SEC, in manner of speaking, to select their court. 35
x x x x (Emphasis supplied)cralawlawlibrary
Therefore, one must be disabused of the notion that the transfer of jurisdiction was made only in favor of
particular RTC branches, and not the RTCs in general.
Consistent with the foregoing, history depicts that when the transfer of SEC cases to the RTCs was first
implemented, they were transmitted to the Executive Judges of the RTCs for raffle between or among its
different branches, unless a specific branch has been designated as a Special Commercial Court, in
which instance, the cases were transmitted to said branch.36 It was only on November 21, 2000 that
the Court designated certain RTC branches to try and decide said SEC cases 37 without, however,
providing for the transfer of the cases already distributed to or filed with the regular branches thereof.
Thus, on January 23, 2001, the Court issued SC Administrative Circular No. 08-2001 38 directing the
transfer of said cases to the designated courts (commercial SEC courts). Later, or on June 17, 2003, the
Court issued A.M. No. 03-03-03-SC consolidating the commercial SEC courts and the intellectual property
courts39 in one RTC branch in a particular locality, i.e., the Special Commercial Court, to streamline
the court structure and to promote expediency.40 Accordingly, the RTC branch so designated was
mandated to try and decide SEC cases, as well as those involving violations of intellectual property rights,
which were, thereupon, required to be filed in the Office of the Clerk of Court in the official station of the
designated Special Commercial Courts, to wit:chanRoblesvirtualLawlibrary
1. The Regional Courts previously designated as SEC Courts through the: (a) Resolutions of this Court
dated 21 November 2000, 4 July 2001, 12 November 2002, and 9 July 2002 all issued in A.M. No. 00-1103-SC; (b) Resolution dated 27 August 2001 in A.M. No. 01-5-298-RTC; and (c) Resolution dated 8 July
2002 in A.M. No. 01-12-656-RTC are hereby DESIGNATED and shall be CALLED as Special Commercial
Courts to try and decide cases involving violations of Intellectual Property Rights which fall within their
jurisdiction and those cases formerly cognizable by the Securities and Exchange
Commission:chanRoblesvirtualLawlibrary
xxxx
4. The Special Commercial Courts shall have jurisdiction over cases arising within their respective

territorial jurisdiction with respect to the National Capital Judicial Region and within the respective
provinces with respect to the First to Twelfth Judicial Regions. Thus, cases shall be filed in the Office of
the Clerk of Court in the official station of the designated Special Commercial Court;41
x x x x (Underscoring supplied)cralawlawlibrary
It is important to mention that the Court's designation of Special Commercial Courts was made in line with
its constitutional authority to supervise the administration of all courts as provided under Section 6, Article
VIII of the 1987 Constitution:chanRoblesvirtualLawlibrary
Section 6. The Supreme Court shall have administrative supervision over all courts and the personnel
thereof.cralawlawlibrary
The objective behind the designation of such specialized courts is to promote expediency and
efficiency in the exercise of the RTCs' jurisdiction over the cases enumerated under Section 5 of PD
902-A. Such designation has nothing to do with the statutory conferment of jurisdiction to all RTCs under
RA 8799 since in the first place, the Court cannot enlarge, diminish, or dictate when jurisdiction shall be
removed, given that the power to define, prescribe, and apportion jurisdiction is, as a general rule,
a matter of legislative prerogative.42 Section 2, Article VIII of the 1987 Constitution
provides:chanRoblesvirtualLawlibrary
Section 2. The Congress shall have the power to define, prescribe, and apportion the jurisdiction of the
various courts but may not deprive the Supreme Court of its jurisdiction over cases enumerated in Section
5 hereof.
xxxx
cralawlawlibrary
Here, petitioners filed a commercial case, i.e., an intra-corporate dispute, with the Office of the Clerk of
Court in the RTC of Muntinlupa City, which is the official station of the designated Special Commercial
Court, in accordance with A.M. No. 03-03-03-SC. It is, therefore, from the time of such filing that the
RTC of Muntinlupa City acquired jurisdiction over the subject matter or the nature of the
action.43 Unfortunately, the commercial case was wrongly raffled to a regular branch, e.g., Branch
276, instead of being assigned44to the sole Special Commercial Court in the RTC of Muntinlupa
City, which is Branch 256. This error may have been caused by a reliance on the complaint's
caption, i.e., "Civil Case for Injunction with prayer for Status Quo Order, TRO and Damages," 45 which,
however, contradicts and more importantly, cannot prevail over its actual allegations that clearly make out
an intra-corporate dispute:chanRoblesvirtualLawlibrary
16. To the surprise of MLCG and FMDG, however, in two identical letters both dated 13 May 2011, under
the letterhead of GJH Land, Inc., Yap, now acting as its President, Jang and Kim demanded payment of
supposed unpaid subscriptions of MLCG and FMDG amounting to P10,899,854.30 and P2,625,249.41,
respectively.
16.1 Copies of the letters dated 13 May 2011 are attached hereto and made integral parts hereof as
Annexes "J" and "K", repectively.
17. On 29 July 2011, MLCG and FMDG received an Offer Letter addressed to stockholders of GJH Land,
Inc. from Yap informing all stockholders that GJH Land, Inc. is now offering for sale the unpaid shares of
stock of MLCG and FMDG. The same letter states that the offers to purchase these shares will be opened
on 10 August 2011 with payments to be arranged by deposit to the depository bank of GJH Land, Inc.
17.1 A copy of the undated Offer Letter is attached hereto and made and made an integral part hereof as
Annex "L".
18. The letter of GJH Land, Inc. through Yap, is totally without legal and factual basis because as
evidenced by the Deeds of Assignment signed and certified by Yap herself, all the S.J. Land, Inc. shares
acquired by MLCG and FMDG have been fully paid in the books of S.J. Land, Inc.

19. With the impending sale of the alleged unpaid subscriptions on 10 August 2011,there is now a clear
danger that MLCG and FMDG would be deprived of these shares without legal and factual basis.
20. Furthermore, if they are deprived of these shares through the scheduled sale, both MLCG and FMDG
would suffer grave and irreparable damage incapable of pecuniary estimation.
21. For this reason, plaintiffs now come to the Honorable Court for injunctive relief so that after trial on the
merits, a permanent injunction should be issued against the defendants preventing them from selling the
shares of the plaintiffs, there being no basis for such sale. 46cralawlawlibrary
According to jurisprudence, "it is not the caption but the allegations in the complaint or other initiatory
pleading which give meaning to the pleading and on the basis of which such pleading may be legally
characterized."47 However, so as to avert any future confusion, the Court requires henceforth, that all
initiatory pleadings state the action's nature both in its caption and the body, which parameters are
defined in the dispositive portion of this Decision.
Going back to the case at bar, the Court nonetheless deems that the erroneous raffling to a regular
branch instead of to a Special Commercial Court is only a matter of procedure - that is, an incident related
to the exercise of jurisdiction - and, thus, should not negate the jurisdiction which the RTC of Muntinlupa
City had already acquired. In such a scenario, the proper course of action was not for the commercial
case to be dismissed; instead, Branch 276 should have first referred the case to the Executive Judge
for re-docketing as a commercial case; thereafter, the Executive Judge should then assign said
case to the only designated Special Commercial Court in the station, i.e., Branch 256.
Note that the procedure would be different where the RTC acquiring jurisdiction over the case
hasmultiple special commercial court branches; in such a scenario, the Executive Judge, after redocketing the same as a commercial case, should proceed to order its re-raffling among the said
special branches.
Meanwhile, if the RTC acquiring jurisdiction has no branch designated as a Special Commercial
Court, then it should refer the case to the nearest RTC with a designated Special Commercial Court
branch within the judicial region.48 Upon referral, the RTC to which the case was referred to should redocket the case as a commercial case, and then: (a) if the said RTC has only one branch designated as a
Special Commercial Court, assign the case to the sole special branch; or (b) if the said RTC has multiple
branches designated as Special Commercial Courts, raffle off the case among those special branches.
In all the above-mentioned scenarios, any difference regarding the applicable docket fees should be duly
accounted for. On the other hand, all docket fees already paid shall be duly credited, and any excess,
refunded.
At this juncture, the Court finds it fitting to clarify that the RTC mistakenly relied on the Calleja case to
support its ruling. In Calleja, an intra-corporate dispute49 among officers of a private corporation with
principal address at Goa, Camarines Sur, was filed with the RTC of San Jose, Camarines Sur, Branch 58
instead of the RTC of Naga City, which is the official station of the designated Special Commercial Court
for Camarines Sur. Consequently, the Court set aside the RTC of San Jose, Camarines Sur's order to
transfer the case to the RTC of Naga City and dismissed the complaint considering that it was filed before
a court which, having no internal branch designated as a Special Commercial Court, had no jurisdiction
over those kinds of actions, i.e., intra-corporate disputes.Calleja involved two different RTCs, i.e., the
RTC of San Jose, Camarines Sur and the RTC of Naga City, whereas the instant case only involves
one RTC, i.e., the RTC of Muntinlupa City, albeit involving two different branches of the same
court, i.e., Branches 256 and 276. Hence, owing to the variance in the facts attending, it was then
improper for the RTC to rely on the Calleja ruling.
Besides, the Court observes that the fine line that distinguishes subject matter jurisdiction and exercise of

jurisdiction had been clearly blurred in Calleja. Harkening back to the statute that had conferred subject
matter jurisdiction, two things are apparently clear: (a) that the SEC's subject matter jurisdiction over
intra-corporate cases under Section 5 of Presidential Decree No. 902-A was transferred to the Courts of
general jurisdiction, i.e., the appropriate Regional Trial Courts; and (b) the designated branches of the
Regional Trial Court, as per the rules promulgated by the Supreme Court, shall exercise
jurisdiction over such cases. Item 5.2, Section 5 of RA 8799 provides:chanRoblesvirtualLawlibrary
SEC. 5. Powers and Functions of the Commission. - x x x
xxxx
5.2 The Commission's jurisdiction over all cases enumerated under Section 5 of Presidential
Decree No. 902-A is hereby transferred to the Courts of general jurisdiction or the appropriate
Regional Trial Court: Provided, that the Supreme Court in the exercise of its authority may
designate the Regional Trial Court branches that shall exercise jurisdiction over the cases, x x
x.cralawlawlibrary
In contrast, the appropriate jurisprudential reference to this case would be Tan v. Bausch & Lomb,
Inc.,50 which involves a criminal complaint for violation of intellectual property rights filed before the RTC
of Cebu City but was raffled to a regular branch thereof (Branch 21), and not to a Special Commercial
Court. As it turned out, the regular branch subsequently denied the private complainant's motion to
transfer the case to the designated special court of the same RTC, on the ground of lack of jurisdiction.
The CA reversed the regular branch and, consequently, ordered the transfer of the case to the designated
special court at that time (Branch 9). The Court, affirming the CA, declared that the RTC had acquired
jurisdiction over the subject matter. In view, however, of the designation of another court as the Special
Commercial Court in the interim (Branch 11 of the same Cebu City RTC), the Court accordingly ordered
the transfer of the case and the transmittal of the records to said Special Commercial Court
instead.51Similarly, the transfer of the present intra-corporate dispute from Branch 276 to Branch
256 of the same RTC of Muntinlupa City, subject to the parameters above-discussed is proper and
will further the purposes stated in A.M. No. 03-03-03-SC of attaining a speedy and efficient
administration of justice.
For further guidance, the Court finds it apt to point out that the same principles apply to the inverse
situation of ordinary civil cases filed before the proper RTCs but wrongly raffled to its branches
designated as Special Commercial Courts. In such a scenario, the ordinary civil case should then
be referred to the Executive Judge for re-docketing as an ordinary civil case; thereafter, the
Executive Judge should then order the raffling of the case toall branches of the same RTC,
subject to limitations under existing internal rules, and the payment of the correct docket fees in
case of any difference. Unlike the limited assignment/raffling of a commercial case only to branches
designated as Special Commercial Courts in the scenarios stated above, the re-raffling of an ordinary civil
case in this instance to all courts is permissible due to the fact that a particular branch which has been
designated as a Special Commercial Court does not shed the RTC's general jurisdiction over ordinary
civil cases under the imprimatur of statutory law, i.e., Batas Pambansa Bilang (BP) 129.52 To restate, the
designation of Special Commercial Courts was merely intended as a procedural tool to expedite the
resolution of commercial cases in line with the court's exercise of jurisdiction. This designation was not
made by statute but only by an internal Supreme Court rule under its authority to promulgate rules
governing matters of procedure and its constitutional mandate to supervise the administration of all courts
and the personnel thereof.53 Certainly, an internal rule promulgated by the Court cannot go beyond the
commanding statute. But as a more fundamental reason, the designation of Special Commercial Courts
is, to stress, merely an incident related to the court's exercise of jurisdiction, which, as first discussed, is
distinct from the concept of jurisdiction over the subject matter. The RTC's general jurisdiction over
ordinary civil cases is therefore not abdicated by an internal rule streamlining court procedure.
In fine, Branch 276's dismissal of Civil Case No. 11-077 is set aside and the transfer of said case to
Branch 256, the designated Special Commercial Court of the same RTC of Muntinlupa City, under the

parameters above-explained, is hereby ordered.

WHEREFORE, the petition is GRANTED. The Orders dated April 17, 2012 and July 9, 2012 of the
Regional Trial Court (RTC) of Muntinlupa City, Branch 276 in Civil Case No. 11-077 are
herebyREVERSED and SET ASIDE. Civil Case No. 11-077 is REFERRED to the Executive Judge of the
RTC of Muntinlupa City for re-docketing as a commercial case. Thereafter, the Executive Judge
shallASSIGN said case to Branch 256, the sole designated Special Commercial Court in the RTC of
Muntinlupa City, which is ORDERED to resolve the case with reasonable dispatch. In this regard, the
Clerk of Court of said RTC shall DETERMINE the appropriate amount of docket fees and, in so
doing,ORDER the payment of any difference or, on the other hand, refund any excess.
Furthermore, the Court hereby RESOLVES that henceforth, the following guidelines shall be observed:
1. If a commercial case filed before the proper RTC is wrongly raffled to its regular branch, the proper
courses of action are as follows:
1.1 If the RTC has only one branch designated as a Special Commercial Court, then the case shall be
referred to the Executive Judge for re-docketing as a commercial case, and thereafter, assigned to the
sole special branch;
1.2 If the RTC has multiple branches designated as Special Commercial Courts, then the case shall be
referred to the Executive Judge for re-docketing as a commercial case, and thereafter, raffled off among
those special branches; and
1.3 If the RTC has no internal branch designated as a Special Commercial Court, then the case shall be
referred to the nearest RTC with a designated Special Commercial Court branch within the judicial region.
Upon referral, the RTC to which the case was referred to should re- docket the case as a commercial
case, and then: (a) if the said RTC has only one branch designated as a Special Commercial Court,
assign the case to the sole special branch; or (b) if the said RTC has multiple branches designated as
Special Commercial Courts, raffle off the case among those special branches.
2. If an ordinary civil case filed before the proper RTC is wrongly raffled to its branch designated as a
Special Commercial Court, then the case shall be referred to the Executive Judge for re-docketing as an
ordinary civil case. Thereafter, it shall be raffled off to all courts of the same RTC (including its designated
special branches which, by statute, are equally capable of exercising general jurisdiction same as regular
branches), as provided for under existing rules.
3. All transfer/raffle of cases is subject to the payment of the appropriate docket fees in case of any
difference. On the other hand, all docket fees already paid shall be duly credited, and any excess,
refunded.
4. Finally, to avert any future confusion, the Court requires that all initiatory pleadings state the action's
nature both in its caption and body. Otherwise, the initiatory pleading may, upon motion or by order of the
court motu proprio, be dismissed without prejudice to its re-filing after due rectification. This last
procedural rule is prospective in application.
5. All existing rules inconsistent with the foregoing are deemed superseded.cralawlawlibrary
SO ORDERED.