G.R. No.

173915 February 22, 2010

IRENE AND REYNALDO SANTE vs. HON. EDILBERTO CLARAVALL, in his capacity as Presiding Judge
of Branch 60, Regional Trial Court of Baguio City, and VITA KALASHIAN

Before this Court is a petition for certiorari 1 under Rule 65 of the 1997 Rules of Civil Procedure, as amended, filed by
petitioners Irene and Reynaldo Sante assailing the Decision 2 dated January 31, 2006 and the Resolution3dated 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 4 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
₱300,000.00; ₱50,000.00 as exemplary damages; ₱50,000.00 attorney’s fees; ₱20,000.00 litigation expenses; and
costs of suit.

Petitioners filed a Motion to Dismiss5 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 ₱300,000.00, because the claim for exemplary damages should be
excluded in computing the total claim.

On June 24, 2004,6 the trial court denied the motion to dismiss citing our ruling in Movers-Baseco Integrated Port
Services, Inc. v. Cyborg Leasing Corporation.7 The trial court held that the total claim of respondent amounted to
₱420,000.00 which was above the jurisdictional amount for MTCCs outside Metro Manila. The trial court also later
issued Orders on July 7, 20048 and July 19, 2004,9 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, 10 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
Complaint11 increasing the claim for moral damages from ₱300,000.00 to ₱1,000,000.00. Petitioners filed a Motion to
Dismiss with Answer Ad Cautelam and Counterclaim, but the trial court denied their motion in an Order 12 dated
September 17, 2004.

Hence, petitioners again filed a Petition for Certiorari and Prohibition 13 before the Court of Appeals, docketed asCA-
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 ₱300,000.00 to ₱1,000,000.00. 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.14

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 ₱300,000.00, 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 ₱300,000.00 to ₱1,000,000.00, 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 ₱300,000.00;

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. 85465.15

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 ₱300,000.00 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,16 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 ₱420,000.00, 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 on
certiorari under Rule 45 in view of the issues raised.

Section 19(8) of Batas Pambansa Blg. 129,17 as amended by Republic Act No. 7691,18 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 (₱100,000.00) or,
in such other cases in Metro Manila, where the demand, exclusive of the abovementioned items exceeds Two hundred
thousand pesos (₱200,000.00).

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 (₱200,000.00). Five (5) years thereafter, such jurisdictional amounts shall be adjusted further to Three
hundred thousand pesos (₱300,000.00): 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 (₱400,000.00).
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 ₱100,000.00 to ₱200,000.00 took effect on March 20, 1999.
Meanwhile, the second adjustment from ₱200,000.00 to ₱300,000.00 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 ₱300,000.00.

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. 09-9419 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 complaint since the latter comprises a concise statement of the ultimate facts
constituting the plaintiff’s causes of action.20 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.1avvphi1

In Mendoza v. Soriano,21 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 ₱929,000.06 in damages and ₱25,000 attorney’s fees plus ₱500 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,22 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 ₱420,000.00, 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 ₱300,000.00 to ₱1,000,000.00 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,23 here, the RTC clearly had jurisdiction over the original complaint
and amendment of the complaint was then still a matter of right. 24

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.
G.R. No. 164594 April 22, 2015

MICHAEL SEBASTIAN vs. ANNABEL LAGMAY NG

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 daµghter 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 ₱350,000.00 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 ₱350,000.00 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 ₱250,000.00 on specific dates. The kasunduan
was signed by Angelita (on behalf of Annabel), Michael, and the members of the pangkat ng tagapagkasundo. The
kasunduanreads: KASUNDUAN

Nagkasundo ang dalawang panig napagkayari 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 ₱250,000.00 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 of ₱250,000.00.
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 ₱250,000.00 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 plaintiff’s counsel in the amount of ₱15,000.00 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 ₱250,000.00. 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 (₱250,000.00) plus twelve percent
interest(12%) per annum from September,1998 up to the time it is actually paid and fifty Thousand Pesos(₱50,000.00)
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 ₱250,000.00 (as the subject matter of the
kasunduan) is in excess of MCTC’s jurisdictional amount of ₱200,000.00. 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 Review 9with 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 the Katarungang 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) there was no record of the complaint in the Barangay;

(2) there was no notice of mediation sent to him;

 (3) there was no constitution of the Pangkat Ng Tagapagasundo;

(4) the parties were never called upon to choose the three (3) members from among the Lupon members;

(5) he had no participation in the execution of the kasunduan;

(6) his signature in the kasunduan was forged;

(7) he did not personally appear before the Barangay;

(8) there was no attestation clause;

(9) the kasunduan was neither reported nor filed before the MCTC; and

(10) 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 ₱250,000.00 – the subject matter of the kasunduan – is in excess of MCTC’s jurisdictional amount
of ₱200,000.00, 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 kasunduan regardless 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 CA – 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 of ten (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 resortedto 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
plaintiff’s 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 of ten (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 of ten (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.1âwphi1 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 the 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 on certiorari, 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.

G.R. No. 176492 October 20, 2014

MARIETTA BARRIDO vs. LEONARDO NONATO

For the Court's resolution is a Petition for Review filed by petitioner Marietta N. Barrido questioning the Decision 1of
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) ofBacolod 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: 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
ofa 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 co-
ownership 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:

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, defendant’s counterclaim is hereby granted, ordering plaintiff to pay defendant ₱10,000.00 as moral
damages for the mental anguish and unnecessary inconvenience brought about by this suit; and an additional
₱10,000.00 as exemplary damages to deter others from following suit; and attorney’s fees of ₱2,000.00 and litigation
expenses of ₱575.00.

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:

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:

(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.5

Upon appeal, the CA affirmed the RTC Decision on November 16, 2006. It held that since the property’s assessed
value was only ₱8,080.00, it clearly fell within the MTCC’s jurisdiction. Also, although the RTC erred in relying on
Article 129 of the FamilyCode, 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:

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.6

The petition lacks merit.

Contrary to Barrido’s 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:

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:

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 propertyor interest therein does not exceed Twenty thousand pesos
(₱20,000.00)or, in civil actions in Metro Manila, where such assessed value does not exceed Fifty thousand pesos
(₱50,000.00) exclusive of interest, damages of whatever kind, attorney's fees, litigation expenses and costs: Provided,
That 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 property’s assessed value was merely ₱8,080.00, an amount which certainly does not exceed the
required limit of ₱20,000.00 for civil actions outside Metro Manila tofall within the jurisdiction of the MTCC.
Therefore, the lower court correctly took cognizance of the instant case.

The records reveal that Nonatoand Barrido’s 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:

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 tohave been
obtained by their joint efforts, work or industry, and shall beowned 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.1âwphi1 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 impedimentto 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" inthe 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. 15

Under this property regime, property acquired by both spouses through their work and industry shall be governed by
the rules on equal coownership. Any property acquired during the union is prima faciepresumed 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. 17

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 initiobecause of
psychological incapacity on the part of either or both parties in the contract of marriage.The Court held that the court a
quodid 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 coownership 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 spousesor spouses of void marriages. 20

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 safe 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.

G.R. No. 138896 June 20, 2000

BARANGAY SAN ROQUE, TALISAY, CEBU vs. Heirs of FRANCISCO PASTOR namely: EUGENIO
SYLIANCO, TEODORO SYLIANCO, TEODORO SYLIANCO, ISABEL SYLIANCO, EUGENIA S. ONG,
LAWRENCE SYLIANCO, LAWSON SYLIANCO, LAWINA S. NOTARIO, LEONARDO SYLIANCO JR.
and LAWFORD SYLIANCO

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 Order1 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:

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:

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:

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 Court's 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, attorney's 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:

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 a sum of 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:

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. 1 In the main,
the subject of an expropriation suit is the government's 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 duty-bound to
determine the just compensation for it.1avvphi1 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.

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." 17

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.

G.R. No. 202664, November 20, 2015

MANUEL LUIS AND FRANCIS MARTIN GONZALES 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

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, 9 and 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 intra-corporate 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, citingCalleja 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-SC 25 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 cases37 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.
08-200138 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. 00-11-03-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 andthose 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 re-docketing 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 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.

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 to all 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 shall ASSIGNsaid 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.

Leonardo-De Castro, J., I concur in the result. I subscribe to the ruling in the Calleja case that the misfiling of a
commercial case with a court not duly designated Special Commercial Court is an error of jurisdiction.� However
the Supreme Court has constitutional and legal basis [RA 8799] to promulgated the guidelines here for future cases.

DISSENTING OPINION

PEREZ, J.:

I am constrained to register my dissent to the ponencia that the Securities and Exchange Commission's (SEC's)
jurisdiction over cases enumerated in Section 5 of Presidential Decree (P.D.) No. 902-A was transferred to all
Regional Trial Courts, unaffected by the proviso in the same Section that the Supreme Court may designate the
Regional Trial Court branches that shall exercise the transferred jurisdiction. I base my dissent on the plain wording of
Section 5.2 of Republic Act. No. 8799 or "The Securities Regulation Code."

Briefly, the undisputed facts.

Petitioners Manuel Luis C. Gonzales and Francis Martin D. Gonzales filed a Complaint 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 II before the Regional Trial Court (RTC) of Muntinlupa City seeking to enjoin the sale of S.J. Land,
Inc.'s shares which petitioners purportedly already bought from, and fully paid to, S.J. Global, Inc. on 1 February
2010. Petitioners, the Gonzales', designated their Complaint as a Civil Case for Injunction with prayer for Status
Quo Order, TRO and Damages.1

Essentially, the allegations in the Complaint state that petitioners subscribed to a total of 295,116 shares fully paid in
the books of S.J. Land Inc., acquiring 40% and 10% of the outstanding capital stock thereof. The bone of contention in
the Complaint is the status of the shares, i.e., whether fully paid or unpaid by petitioners and the consequent issue of
ownership and its incidences.

Upon filing of the Complaint with the Office of the Clerk of Court of the RTC of Muntinlupa City, it was raffled to
Branch 276, which is not a Special Commercial Court. On 9 and 24 August 2011, the RTC, Branch 276, in two
separate Orders, issued a temporary restraining order and a writ of preliminary injunction.

After filing their respective answers to the complaint, respondents filed a motion to dismiss 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.

In an Order dated 17 April 2011, Branch 276 granted the motion to dismiss, ruling that the case involves an intra-
corporate dispute falling within the original and exclusive jurisdiction of the RTCs designated as Special Commercial
Courts, Branch 256 in this instance. Since Branch 276 was not specifically designated by the Supreme Court as a
commercial court, it had no jurisdiction over the intra-corporate dispute, and accordingly, the case should be
dismissed.
On motion for reconsideration, petitioners argued that: (1) they had no control over raffle of cases; (2) the RTCs have
jurisdiction over intra-corporate disputes pursuant to Republic Act (R.A.) No. 8799, with only the Supreme Court
designating specific branches as special commercial courts, thus, at most, the case should be transferred or raffled to
the proper branch; and (3) in all, as a matter of justice and equity, they cannot be prejudiced by the incorrect raffling of
their case since they complied with the rules for the filing of cases.

Branch 276 stood pat on its ruling that it was without jurisdiction to hear, decide and act on the case, not designated as
a special commercial court pursuant to A.M. No. 00-11-03-SC/l 1-21-00. Ratiocinating further that without any kind
of authority to act thereon, Branch 276 can only dismiss the case and cannot order the transfer of the case to the proper
RTC following our ruling in Calleja v. Panday.2 The reversal of the rulings is the object of this Petition before us.

In granting the petition, the ponencia starts with the basic premise that jurisdiction over the subject matter is conferred
by law, distinct from the exercise of jurisdiction which, 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. The ponencia points to R.A. No. 8799, specifically
Section 5.2, as the law conferring (transferring) original and exclusive jurisdiction to the appropriate RTCs (from the
Securities and Exchange Commission) over cases enumerated in Section 5 of Presidential Decree (P.D.) No. 902-A
(SEC Cases). Theponencia clarifies, however, that the Supreme Court's designation of specific Special Commercial
Courts, made subject of various Supreme Court Administrative Matters, 3 was not a conferment of jurisdiction, but a
"procedural tool to promote expediency and efficiency in the exercise of the RTCs jurisdiction over such cases."
In this instance, pursuant to our Rules directing the manner by which jurisdiction shall be exercised, commercial cases
were required to be filed in the Office of the Clerk of Court in theofficial station of the designated Special
Commercial Courts.

The ponencia emphasizes that, petitioners having "correctly filed an intra-corporate case 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 [the Rules]," the RTC, "from the time of such filing[,] acquired jurisdiction over the subject matter or
the nature of the action."

Specifically, the ponencia holds:chanRoblesvirtualLawlibrary

Unfortunately, the case was raffled to Branch 276 instead of being assigned to the single Special Commercial Court in
the RTC of Muntinlupa City, which is Branch 256. As the Court sees it, this 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 RTC's
exercise of jurisdiction - and, thus, should not negate the jurisdiction which the RTC of Muntinlupa City had already
acquired. As such, Branch 276 should have merely ordered the transfer of the case to Branch 256, and not its
dismissal, x x xcralawlawlibrary

In sum, the ponencia, discussing and citing the cases of Calleja, on which the court a quobased the herein assailed
Order, Tan v. Bausch & Lomb, Inc.,4 and Home Guaranty Corporation v. R-II Builders, Inc.,5 draws a distinction
between subject matter jurisdiction conferred by law, in this instance falling with the RTCs, and the exercise of
jurisdiction, in accordance with the designation of appropriate RTCs by the Supreme Court. Thus, according to
the ponencia, the RTC of Muntinlupa City regardless of the Supreme Court designated branch, acquired jurisdiction
over Civil Case No. 11-077 upon the filing of the complaint in the official station of the designated Special
Commercial Courts. Thus, too, Branch 276, an RTC, albeit not designated as a Special Commercial Court, should
simply order the transfer of the case to Branch 256, the designated Special Commercial Court, contemplating merely a
procedural matter, incidental to the RTC's exercise of jurisdiction. In all, as per the ponencia, the general investiture of
jurisdiction to all RTCs is absolute, and once acquired, any of the RTCs may, in the exercise of vested jurisdiction,
order the transfer of cases to the specific branch designated by the Supreme Court as a Special Commercial Court.

With all due respect, the ponencia proceeds from the wrong premise that the law vested jurisdiction over transferred
SEC cases on all the Regional Trial Courts and that the designation by the Supreme Court of Special Commercial
Courts concern only an "exercise of jurisdiction."

Section 5, Item 5.2 of R.A. No. 8799 reads: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 6 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.cralawlawlibrary

Thus, I am constrained to differ based on the statements in, and exact wording of, the law

It is first axiom in legal hermeneutics that a statutory provision is read as a whole and not in disjointed parts. The rule
is as respected as it is ancient. Its sum and substance has not been diluted no matter how frequent the free paraphrases
have been. The textbook says:chanRoblesvirtualLawlibrary

Subject always to the cardinal rule of statutory construction, the courts should give every reasonable interpretation to a
statute which will give effect and meaning to every part or word thereof.

A statute should be construed that no word, clause, sentence, provision or part shall be rendered surplusage, or
superfluous, meaningless, void, insignificant or nugatory, if that can be reasonably avoided.

The rule has its basis in the presumption that the legislature could not have intended to use words in vain or to leave
part of its enactment devoid of sense or meaning. It cannot be presumed that the legislature introduced into a statute,
words, clauses, provisions which would annul or mutually destroy each other. Rather, it is to be presumed that it is the
purpose of the legislature that the entire statute and every part thereof should be significant and effective.

The maxim "ut res tnagis quam per eat" requires not merely that a statute should be given effect as a whole but that
effect should be given to each of its express provisions.

Under this rule, that construction is favored which will render every word operative rather than one which makes
some words idle and nugatory.

However, the court may not, in order to give effect to particular words, virtually destroy the meaning of the entire
context, e.g., give them a significance which would be clearly repugnant to the statute looked upon as a whole and
destructive of its obvious intent.7ChanRoblesVirtualawlibrary
cralawlawlibrary

Included in the Philippine applications of the tenet are the cases of: (1) Land Bank of the Philippines v. AMS Farming
Corporation;8Mactan-Cebu International Airport Authority v. Urgello;9 and Smart Communications, Inc. v. The City
of Danao,10 as cited in Philippine International Trading Corporation v. Commission on Audit11 where the Court's
ruling was:chanRoblesvirtualLawlibrary

It is a rule in statutory construction that every part of the statute must be interpreted with reference to the context, i.e.,
that every part of the statute must be considered together with the other parts, and kept subservient to the general
intent of the whole enactment. Because the law must not be read in truncated parts, its provisions must be read in
relation to the whole law. The statute's clauses and phrases must not, consequently, be taken as detached and isolated
expressions, but the whole and every part thereof must be considered in fixing the meaning of any of its parts in order
to produce a harmonious whole. Consistent with the fundamentals of statutory construction, all the words in the statute
must be taken into consideration in order to ascertain its meaning.cralawlawlibrary

I must here repeat the application of the rule. Thus must the following conclusions be reached.

Section 5, Item 5.2 of R.A. No. 8799 did not transfer the cases enumerated under Section 5 of P.D. No. 902-A to all
the RTCs. If that was the legislative intention, then the provision should have simply stated that such cases are "hereby
transferred to the Regional Trial Courts." The complete investiture is, however, on "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." If the law is a general
conferment of jurisdiction on all RTC, then the phrase "or the appropriate Regional Trial Court" is an inutile
surplusage and the proviso that "the Supreme Court in the exercise of its authority may designate the Regional Trial
Court branches that shall exercise jurisdiction over the cases" is a purposeless appendage and wasted words. A general
grant to all RTCs renders irrelevant the "Supreme Court's exercise of authority" on the matter. Such a general grant
renders meaningless the designation by the Supreme Court of the RTC branches that shall exercise jurisdiction over
the cases.

Each word in the law was purposely written; and all such words make up the phrased idea. This is a basic
presumption: To repeat -

[T]he legislature could not have intended to use words in vain or to leave part of its enactment devoid of sense or
meaning. It cannot be presumed that the legislature introduced into a statute, words, clauses, provisions which would
annul or mutually destroy each other. Rather, it is to be presumed that it is the purpose of the legislature that the entire
statute and every part thereof should be significant and effective. 12cralawlawlibrary
Section 5, Item 5.2 of R.A. No. 8799 should therefore be read to mean that SEC's jurisdiction over all cases under
Section 5 of P.D. No. 902-A is transferred to the specific RTC branch designated by the Supreme Court in the exercise
of its authority.

This is the reading of the Supreme Court as expressed with precision in A.M. No. 00-11-03-SC dated 21 November
2000 which is aptly titled "Resolution Designating Certain Branches of Regional Trial Courts To Try and Decide
Cases Formerly Cognizable by the Securities and Exchange Commission" "arising within their respective territorial
jurisdictions with respect to the National Capital Region and within the respective provinces in the First to the Twelfth
Judicial Regions." This En Banc Resolution opened with a purpose clause reading "to implement the provisions of
Sec. 5.2 of Republic Act No. 8799 (The Securities Regulation Code). This is an unequivocal statement that the Court
interprets the provision to mean that only the RTC Branches that it shall designate to hear and decide Special
Commercial Court cases can exercise jurisdiction over such cases. The issued guideline reinforces the exclusivity of
the designation:chanRoblesvirtualLawlibrary

1. In multiple sala courts where one (1) or more branches of the RTC are herein designated as special courts, there will
be no unloading of cases already pending in the branches designated. They shall continue to try and decide the said
cases in addition to the SEC cases. In the meantime, in view of the temporary imbalance of caseload as a result of the
transfer of SEC cases, the Executive Judge concerned shall exclude them in the raffle of newly filed cases in their
station until their workload equals to that of the other branches, in which event they shall be included in the raffle of
other civil and criminal cases.

x x x x

5. In provinces (for the First to the Twelth Judicial Regions) where there are no designated special courts, the
Executive Judge of the station where new SEC cases will be filed shall consult the Supreme Court thru the Office of
the Court Administrator.cralawlawlibrary

There have been subsequent designations of RTC Branches as SEC courts, namely: RTC Branch 142, Makati City
through A.M. No. 00-11-03-SC; RTC Branch 34, Calamba, Laguna through amendment A.M. No. 00-11-03-SC; RTC
Branch 40, in Daet, Camarines Norte; RTC Branch 2, Tuguegarao, Cagayan; RTC Branch 74, Malabon; RTC Branch
36, Masbate again through an amendment of A.M. No. 00-11-03-SC; and RTC Branch 23 of Naga City through A.M.
No. 01-5-298-RTC.

There has been, as just enumerated, as many iterations by the court itself of its reading of Section 5, Item 5.2 of P. D.
8799 i.e., that the law transferred the SEC jurisdiction over the cases listed in Sec. 5 of P.D. No. 902-A to the
particular branches of the RTCs designated by the Supreme Court as such. Unavoidable, therefore, is the conclusion
that all other Branches of the RTCs without the Supreme Court designation are without jurisdiction over SEC cases.
And, following unreversed rulings13 the other Branches of the RTC before whom a SEC case is filed must dismiss
such case for want of jurisdiction. Furthermore, absent such jurisdiction, the non-SEC RTC cannot direct the case to
the "proper" court.14

The unavoidable, because statutorily mandated, allocation to RTC branches of the authority to decide SEC cases had,
just as unavoidably, resulted in caseload imbalance in affected areas. Parenthetically, there was a resulting caseload
imbalance since R.A. No. 8799 did not create Commercial Courts. The law merely unloaded SEC cases to the
branches designated by the Supreme Court as Commercial Courts. The consequent caseload problem urged the
exercise by the Court, as administrator, to effect an equitable distribution of cases among the RTC branches in areas
where RTC branches have been given jurisdiction over the additional case types. Thus did the Court issue the
Resolutions on the exclusion of the SEC designated courts from the raffle of cases.

Such arrangement continued until the weight of the unloaded jurisdiction eased such that the Court in 1 July 2003
issued A.M. No. 03-03-03-SC. It states:chanRoblesvirtualLawlibrary

1. The Regional Trial 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. 00-11-03-
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;

2. The designation of Intellectual Property Courts under Administrative Order No. 113-95 dated 2 October 1995,
as amended by Administrative Order No. 104-96 dated 21 October 1996 and Resolution dated 19 February
2002 in A.M. No. 02-1-11- SC, is hereby revoked. However, the Regional Trial Court, Branch 24, Manila is
hereby designated as an additional Special Commercial Court in the City of Manila;
 3. Upon the effectivity of this Resolution, all IP cases shall be transferred to the designated Special Commercial
Courts except those which have undergone the pre-trial state in civil cases or those where any of the accused
has been arraigned in criminal cases which shall be retained by the court previously assigned to try them;

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;

5. In the event of inhibition of the judge of a designated Special Commercial Court, the following guidelines
shall be observed: (a) where there is only one (1) Special Commercial Court, the case shall be raffled among
the other judges in the station; (b) where there are two (2) Special Commercial Courts in the station, the
Executive Judge shall immediately assign the case to the other Special Commercial Court; and (c) in case of
inhibition of both judges of the Special Commercial Court, the Executive Judge shall raffle the case among
the judges in the station; and

6. In order to ensure a just and equitable distribution of cases, the designated Special Commercial Courts shall
continue to participate in the raffles of other cases. Provided, however, that the Executive Judge concerned
shall adopt a procedure whereby every IP and SEC case assigned to a Special Commercial Court should be
considered a case raffled to it and duly credited to such court.

cralawlawlibrary

What must be noted is the fact that the chosen RTC branch, now called Commercial Court, became such, as
distinguished from the other RTC branches because of a special bestowal of jurisdiction by the Court in
implementation of the statutorily granted authority. Without such grant mandated by the law, the undesignated RTC
branch is without SEC case jurisdiction.

Upon the other hand, the RTC branch, or the Commercial Court, maintain jurisdiction over the cases enumerated in
Section 19, of Batas Pambansa Blg. 129.15

But the exercise of such jurisdiction is subject to the regulation of the Court in the exercise of its constitutional power
of administrative supervision over all lower courts:

SEC. 5. The Supreme Court shall have the following powers:chanRoblesvirtualLawlibrary

x x x x

(5) Promulgate rules concerning the protection and enforcement of constitutional rights, pleading, practice, and
procedure in all courts, the admission to the practice of law, the Integrated Bar, and legal assistance to the
underprivileged. Such rules shall provide simplified and inexpensive procedure for the speedy disposition of cases,
shall be uniform for all courts of the same grade, and shall not diminish, increase, or modify substantive rights. Rules
of procedure of special courts and quasi-judicial bodies shall remain effective unless disapproved by the Supreme
Court.

x x x x

Section 6. The Supreme Court shall have administrative supervision over all courts and the personnel
thereof.cralawlawlibrary

This is evident from A.M. No. 00-11-03-SC and A.M. No. 03-03-03-SC.

Palpably, RTC caseloads and the need to equalize the caseloads among all branches determine the need for the Court
to issue regulations regarding the Commercial Courts' exercise of jurisdiction over non�commercial cases.

In all, the RTC Commercial Court has exclusive jurisdiction over commercial cases and can still exercise jurisdiction
over regular cases if, as determined by the Supreme Court, the caseloads necessitate such exercise.

While there may be arguments in favor of a simpler arrangement whereby all the RTCs in all the Judicial Districts are
made Commercial Courts, such arguments cannot be submitted for resolution by the Court. The settlement is in the
legislature.

Further on the issue, the proviso that "the Supreme Court in the exercise of its authority may designate the Regional
Trial Court branches that shall exercise jurisdiction over these cases" is a definition of the conferred jurisdiction.
The designation of specific Regional Trial Court branches that will exercise jurisdiction over cases enumerated under
Section 5 of P.D. No. 902-A is pursuant to statute and not solely the consequence of the Court's rule-making power
and administrative supervisory power of the Court over lower courts under Article VIII, Sections 5 (paragraph 5) and
6, respectively. In fact, A.M. No. 03-03-03-SC on which the ponencia relies heavily for its position that the
designation of specific RTC branches as a simple procedural rule incidental to the exercise of jurisdiction, primarily
traces its authority for designation of Special Commercial Courts to Section 5.2 of R.A. No. 8799, gleaned from the
1st recital clause, to wit:

WHEREAS, to implement the provisions of Section 5.2 of Republic Act No. 8799 (The Securities and
Regulation Code), and in the interest of a speedy and efficient administration of justice, the Supreme Court en banc,
in the (a) Resolutions dated 21 November 2000 (Annex 1), 4 July 2001 (Annex 1-a), 12 November 2002 (Annex 1-b),
and 9 July 2002 (Annex 1-c), all issued in A.M. No. 00-11-03-SC; (b) Resolution dated 27 August 2001 in A.M. No.
01-5-298-RTC (Annex 2); and (c) Resolution dated 8 July 2002 in A.M. No. 01-12-656-RTC (Annex 3), resolved to
designate certain branches of the Regional Trial Courts to try and decide cases formerly recognizable by the Securities
and Exchange Commission;
Plainly, the designation of Special Commercial Courts, as implemented by the Supreme Court through its various
rules, pertains to the statutorily conferred jurisdiction and not merely an incident related to the court's exercise of
jurisdiction.

The ponencia fails to address an equally important precept on subject matter jurisdiction,i.e., jurisdiction is
determined by the averments and allegations of the complaint which in this instance is inarguably a commercial case
concerning subscription of shares in a corporation.

From the onset, petitioners, by the filing of their Complaint, supplied the occasion for the exercise of
jurisdiction vested by law in a particular court. In short, petitioners invoked the jurisdiction of the RTC (not as a
court of general jurisdiction), and with the allegations in their Complaint, specifically invoked the RTC designated as
a Special Commercial Court under Section 5.2 of RA 8799, implemented under A.M. No. 03-03-03-SC. Petitioners
cannot just simply file their Complaint before the RTC without any specificity, given the allegations contained
therein and the reliefs they prayed for.

I cannot give credence to petitioners' stance that they cannot be faulted for the incorrect raffling of their Complaint to
a regular court, having filed the same before the Office of the Clerk of Court in the RTC of Muntinlupa City.
Petitioners obviously argue that their only responsibility as plaintiffs in this case is to file the case with the RTC
despite Section 5.2 of R.A. No. 8799 confining exclusive and original jurisdiction over cases enumerated under
Section 5 of P.D. No. 902-A to the appropriate RTC.

I invite attention to the statement in the ponencia that "petitioners correctly filed an intra-corporate case 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." The ponencia then concludes that the RTC had
validly acquired jurisdiction over the subject matter or the nature of the action from the time of such filing.

Quite notably, petitioners did not intend to file an intra-corporate case: they labeled their Complaint though incorrectly
as a Civil Case for Injunction with prayer for Status QuoOrder, TRO and Damages. At that time they filed their
Complaint in 2011, petitioners were with the aid of counsel, a full service law firm and R.A. No. 8799 and the
implementing rules of the Supreme Court for the designation of Special Commercial Courts, have long been effective.
Subject matter jurisdiction over their Complaint, the nature determined by the allegations therein, has been settled and
delineated to be with not just any RTC, but the appropriate RTC specially designated by the Supreme Court as a
Special Commercial Court pursuant to law.

Petitioners, as plaintiffs, by the filing of their Complaint, are charged with responsibility to properly and correctly
invoke the jurisdiction of the RTC whether in the exercise of its general jurisdiction or as a Special Commercial
Court. Palpably, petitioners' incorrect labeling of their Complaint precipitated the incorrect raffling thereof to a
regular court, Branch 276, which, by specific provision of law, is without subject matter jurisdiction to act thereon
given that it had not been designated as a Special Commercial Court.

Second, with the incorrect labeling of their Complaint and the wrong invocation of the RTC's regular jurisdiction, the
designated Special Commercial Court did not acquire jurisdiction over the Complaint by the mere filing thereof with
the multi sala RTC. Since petitioners had filed what they labeled as a Civil Case, they knowingly filed it pursuant to
the general jurisdiction of the RTC under Sec. 19 of B.P. Big. 129.

The mere filing of the Complaint before the Office of the Clerk of Court in the RTC of Muntinlupa City, in the official
station of the designated Special Commercial Court as what occurred herein, is not equivalent to the correct and
proper filing of the Complaint before the appropriate Regional Trial Court specially designated by the Supreme Court
to hear and decide cases enumerated under Section 5 of P.D. No. 902-A. Branch 276 of the RTC, to which the
Complaint was consequently raffled, in the exercise of its general jurisdiction, cannot order the transfer of the
Complaint to Branch 256, the designated Special Commercial Court. Branch 276 cannot do so on the basis of
authority over the case which it did not have. Neither does it have authority over a co-equal court.

Note that in this case, petitioners, given the labeling of their Complaint as a Civil Case, should suffer the
consequences of its own act. The Office of the Clerk of Court, cannot be faulted for raffling it to the RTC of general
jurisdiction as petitioners themselves invoked such general jurisdiction.
In Calleja v. Panday,16 we likewise took note of the fact that therein plaintiffs petition for quo warranto was filed as
late as 2005, by that time A.M. No. 00-11-03-SC has been in effect for four years, and A.M. No. 03-03-03-SC
effective for almost two years, where there appears no cogent reason why plaintiffs were not aware of the appropriate
court where their petition should be filed.

Such can also be said in this case, albeit there is only one designated Special Commercial Court. With more reason
should it be noted in this case since petitioners herein has even incorrectly labeled their Complaint as a Civil Case.
They cannot claim that it should not be prejudiced by the incorrect raffling of their Complaint, laying fault solely on
the Office of the Clerk of Court.

Indeed, We should, as warranted, require from counsels disciplined knowledge of procedure. Courts should not
themselves correct the procedural mistakes of pleaders. I cannot overemphasize, and ultimately revert to the fact, that
subject matter jurisdiction was conferred by law (Section 5.2 of R.A. No. 8799) to the appropriate RTC as determined
thru the designation by the Supreme Court.

Consistent with the observable conformity with, nay affirmance by the existing administrative issuances relative to the
foregoing opinion, the following directives are reiterated for continuing validity and, therefore, compliance.

1. A.M. No. 00-11 -03-SC, August 27, 2001

2. A.M. No. 03-03-03-SC, July 1, 2003, and
3. All related issuances
Thus, I vote to DENY the petition. The Orders dated 17 April 2012 and 9 July 2012 of the Regional Trial Court of
Muntinlupa City, Branch 276 in Civil Case No. 11-077 areAFFIRMED. The Complaint docketed as Civil Case No.
11-077 is DISMISSED for lack of jurisdiction without prejudice to its re-filing in the proper court.

CONCURRING OPINION - LEONEN, J.:

I concur with the ponencia's conclusion that the designation of certain Regional Trial Court branches as Special
Commercial Courts does not work to confer jurisdiction over the branches designated as such. It was an error for the
Muntinlupa City Regional Trial Court, Branch 276, to dismiss the Complaint filed by petitioners. As the ponencia
underscores, Branch 276 should have instead transferred the case to the Muntinlupa City Regional Trial Court, Branch
256, the branch duly designated to perform the Muntinlupa City Regional Trial Court's functions as a Special
Commercial Court. The present Petition must, thus, be granted.

Jurisdiction over what the ponencia collectively refers to as SEC Cases was vested by Republic Act No. 8799,
otherwise known as the Securities Regulation Code, in Regional Trial Courts and is not limited to the Regional Trial
Court branches designated by this court as Special Commercial Courts. It is only the legislature that has the power "to
define, prescribe, and apportion the jurisdiction of various courtsf.]" 1 As Congress does not share this power with this
court, in relation with these issues, this court's competence is limited to "administrative supervision over all
courts[,]"2 as well as the "[p]romulgat[ion of] rules concerning . . . pleading, practice, and procedure in all courts[.]" 3 It
was purely in the exercise of these powers, and not for the purpose of vesting jurisdiction where previously there was
none, that this court designated certain Regional Trial Court branches as Special Commercial Courts.

The text of Section 5.24 of the Securities Regulation Code, the statutory provision that transferred jurisdiction over
SEC Cases from the Securities and Exchange Commission to the Regional Trial Courts, bears this out. It refers to
Regional Trial Courts in general and in their capacity as courts of general jurisdiction. It delimits the capacity of this
court to designate Regional Trial Court branches as Special Commercial Courts to only be "in the exercise of its
authority[,]"5i.e., administrative supervision and promulgation of procedural rules. It specifies that the effect of this
court's designation is to enable the branches so specified to "exercise jurisdiction" 6 and not to vest jurisdiction.

I
Jurisdiction over all cases enumerated under Section 5 7 of Presidential Decree No. 902-A, which were previously
under the jurisdiction of the Securities and Exchange Commission, was vested in Regional Trial Courts by Section 5.2
of the Securities Regulation Code. Section 5.2 reads:

SEC. 5. Powers and Functions of the Commission. - . . .

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 these 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.cralawlawlibrary
This statutory provision was adopted pursuant to the legislature's power under Article VIII, Section 2 8 of the 1987
Constitution "to define, prescribe, and apportion the jurisdiction of various courts[.]" In contrast, the designation of
Special Commercial Courts, through this court's November 21, 2000 Resolution in A.M. No. 00-11-03-SC, was
pursuant to this court's power under Article VIII, Section 69 of the 1987 Constitution to exercise "administrative
supervision over all courts." A.M. No. 00-11-03-SC did not work to confer jurisdiction independently of Section 5.2 of
the Securities Regulation Code. A.M. No. 00-11-03-SC itself declares that it was adopted merely "[t]o implement the
provisions of Sec. 5.2 of Republic Act No. 8799[.]"10

Congress' power "to define, prescribe, and apportion the jurisdiction of various courts" is constitutionally established.
While it may be true that the allocation of competencies among courts may be incidental and necessary to the power to
adjudicate cases, the sovereign, through the Constitution, deemed it fit for the legislature to exercise this power to
balance and temper judicial power. We cannot, in the guise of judicial interpretation, disregard a clear command of the
Constitution.

The power vested solely and exclusively in Congress has clear limitations: First, Congress cannot diminish the
jurisdiction of this court, which jurisdiction is spelled out in Article VIII, Section 5 11 of the 1987 Constitution; and
second, Congress cannot increase the "appellate jurisdiction of [this court] without its advice and concurrence." 12

The exclusivity and non-delegability of Congress' power "to define, prescribe, and apportion the jurisdiction of
various courts" is long settled.

In University of Santo Tomas v. Board of Tax Appeals,13 this court was confronted with an issuance by the President of
the Philippines, i.e., Executive Order No. 401-A, that was purportedly enacted pursuant to an enabling statute,
Republic Act No. 422.14 Executive Order No. 401-A created the Board of Tax Appeals and defined its jurisdiction, as
follows:chanRoblesvirtualLawlibrary

SEC. 8. The Board of Tax Appeals shall have exclusive jurisdiction to hear and decide administratively as hereinafter
provided �

(1) All appeals from decisions of the Collector of Internal Revenue in cases involving disputed assessments, refunds of
internal revenue taxes, fees or other charges, penalties imposed in relation thereto, or other matters arising under the
National Internal Revenue Code or other law or part of law administered by the Bureau of Internal
Revenue[.]15ChanRoblesVirtualawlibrary
cralawlawlibrary

This court declared Executive Order No. 401-A null and void to the extent where it interfered with the jurisdiction of
Courts of First Instance, but sustained its validity in all other respects. 16 This court emphasized that, in the first place,
Republic Act No. 422's purpose was limited only to "effect[ing] a reorganization of the different bureaus, offices,
agencies and instrumentalities of the executive branch of the government." 17 Republic Act No. 422 did not go so far as
to enable the President to create a body or to promulgate an issuance which, "in effect deprives the courts of first
instance of their jurisdiction in actions for recovery of taxes which is granted to them by section 306 18 of the National
Internal Revenue Code."19

For that matter, even though Republic Act No. 422 actually enabled the President to do so, this statutory grant (i.e.,
delegation) of power would have been invalid. This court categorically stated that under the Constitution, "Congress
alone has 'the power to define, prescribe, and apportion the jurisdiction of the various courtsf,]'" 20 and that this is a
power that cannot be delegated by Congress.21 Pursuant to this power, jurisdiction vested in Courts of First Instance
was conferred on them by statute, i.e., an act of the legislature, and the President, the existence of a supposed enabling
statute notwithstanding, cannot himself define their jurisdiction:chanRoblesvirtualLawlibrary

But Executive Order No. 401-A does not merely create the Board of Tax Appeals, which, as an instrumentality of the
Department of Finance, may properly come within the purview of Republic Act No. 422, but goes as far as depriving
the courts of first instance of their jurisdiction to act on internal revenue cases a matter which is foreign to it and
which comes within the exclusive province of Congress. This the Chief Executive cannot do, nor can that power be
delegated by Congress, for under our Constitution, Congress alone has "the power to define, prescribe, and apportion
the jurisdiction of the various courts. "22(Emphasis supplied, citation omitted)cralawlawlibrary

The same conclusions were reached by this court inCorominas, Jr., and Corominas & Co. v. Labor Standard
Commission, et al.23 Here, this court found the Government Survey and Reorganization Commission to have exceeded
its authority when, through its Reorganization Plan No. 20-A, 24it vested jurisdiction over money claims arising from
labor standards violations in the regional offices of the (then) Department of Labor. 25 Reorganization Plan No. 20-A
ran counter to Republic Act No. 602, the then Minimum Wage Law, Sections 15(d), 26 15(e),27 and 16(a)28 of which
vested jurisdiction over money claims cases in a "competent court."

In Corominas, this court noted that Republic Act No. 997, 29the statute creating the Government Survey and
Reorganization Commission, did not enable the Commission to create a body exercising judicial power and intruding
into the jurisdiction of courts.30 So, too, this court emphasized that Congress could not have done so "as the
Legislature may not and cannot delegate its power to legislate or create courts of justice to any other agency of the
Government."31

Bereft of the power "to define, prescribe, and apportion the jurisdiction of various courts[,]" this court's competence is
limited to "administrative supervision over all courts[,]" 32 as well as the "[p]romulgat[ion] [of] rules concerning . . .
pleading, practice, and procedure in all courts[.]" 33

II

Section 5.2 of the Securities Regulation Code's investiture of jurisdiction over erstwhile SEC Cases in Regional Trial
Courts is clear: "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[.]"

Concededly, the use of the disjunctive conjunction "or" leads to some degree of confusion. Customarily, the use of
"or" denotes that the items mentioned are alternative to each other. Thus, Section 5.2 appears to mean that "Courts of
general jurisdiction" are distinct from Regional Trial Courts and that one can stand in place of the other. However, it is
settled that, in our judicial system, it is the Regional Trial Courts which themselves stand as courts of general
jurisdiction. They are one and the same. As this court stated in Durisol Philippines, Inc. v. Court of
Appeals:34chanroblesvirtuallawlibrary

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.35cralawlawlibrary

The consideration of Regional Trial Courts as courts of general jurisdiction proceeds from Section 19(6) of Batas
Pambansa Big. 129, otherwise known as the Judiciary Reorganization Act of 1980:chanRoblesvirtualLawlibrary

SEC. 19. Jurisdiction in civil cases.�Regional Trial Courts shall exercise exclusive original
jurisdiction:chanRoblesvirtualLawlibrary

. . . .

6. In all cases not within the exclusive jurisdiction of any court, tribunal, person or body exercising judicial or quasi-
judicial functions[.] cralawlawlibrary

The identity of Regional Trial Courts as courts of general jurisdiction is no bar to designating certain Regional Trial
Court branches to focus on certain types of cases. To the contrary, it is this identity which permits it. Designating
branches to focus on certain types of cases, in order to facilitate the efficient dispensation of justice, is well within
their nature as courts competent to take cognizance of cases not falling under the exclusive jurisdiction of any other
court, tribunal, person, or body. Designating branches as such balances two considerations: on the one hand, their
nature as courts, which because they have general jurisdiction, can exercise jurisdiction over the specific matter to
which they were assigned; and, on the other, their duty to speedily administer justice.

Accordingly, this designation does not work to confer jurisdiction over these branches when previously there was
none. It merely exhorts them to proceed with dispatch and deftness. This is evident from Section 23 of the Judiciary
Reorganization Act of 1980:chanRoblesvirtualLawlibrary

SEC. 23. Special jurisdiction to try special cases. � The Supreme Court may designate certain branches of the
Regional Trial Courts to handle exclusively criminal cases, juvenile and domestic relations cases, agrarian cases,
urban land reform cases which do not fall under the jurisdiction of quasi-judicial bodies and agencies, and/or such
other special cases as the Supreme Court may determine in the interest of a speedy and efficient administration of
justice. (Emphasis supplied)cralawlawlibrary

Section 23 is not a blanket license for this court to create new courts of limited jurisdiction. It is an enabling
mechanism, empowering this court to fulfill its function as the authority having "administrative supervision over all
courts[.]"36

When the legislature (at that time, it was the interim Batasang Pambansa) adopted the Judiciary Reorganization Act of
1980, it created all Regional Trial Courts as courts of general jurisdiction, equally competent to exercise the
jurisdiction vested in them by the same statute. So, too, when the Securities Regulation Code transferred jurisdiction
over SEC Cases, it did so to all of our courts which were recognized as courts of general jurisdiction, that is, to
Regional Trial Courts.

Section 5.2's investiture of jurisdiction over Regional Trial Courts notwithstanding, it also contains a proviso enabling
this court to "in the exercise of its authority . . . designate the Regional Trial Court branches that shall exercise
jurisdiction over [the] cases."

Section 5.2's qualification that this court's power to designate is necessarily only "in the exercise of its authority" is
illuminating. It is to say that, in going about its task of designating, this court cannot act in excess of its constitutional
authority. This affirms the Constitution's segregation of the competencies of Congress from those of this court. It
affirms the exclusivity of Congress' power "to define, prescribe, and apportion the jurisdiction of various courts[.]"
This affirms the reality that, bereft of this power, this court's competence is limited to "administrative supervision over
all courts[,]"37 as well as the "[p]romulgat[ion] [of] rules concerning . . . pleading, practice, and procedure in all
courts[.]"38

Accordingly, it was exclusively in the performance of these competencies that this court adopted its November 21,
2000 Resolution in A.M. No. 00-11-03-SC and specified the Regional Trial Court branches which are to perform
functions as Special Commercial Courts.

Equally illuminating is Section 5.2's specification that this court's competence is in designating which branches shall
"exercise jurisdiction[.]" As deftly emphasized by the ponencia, conferment of jurisdiction over the subject matter of a
case is a matter of substantive law. 39 In contrast, incidents pertaining to the exercise of jurisdiction are a matter of
procedure.40

A.M. No. 00-11-03-SC did not create a new class of courts. Its purpose is operational efficiency. In its own words, it
was adopted to serve "the interest of a speedy and efficient administration of justice[.]" 41 It is, thus, but a procedural
and administrative mechanism aimed (to echo the words of the ponencia) "to promote expediency and efficiency in
the exercise of the [Regional Trial Courts'] jurisdiction[.]" 42

Also in its own words, A.M. No. 00-11-03-SC was adopted only "[t]o implement the provisions of Sec. 5.2 of
Republic Act No. 8799 [or the Securities Regulation Code]."43 Thus, in adopting A.M. No. 00-11-03-SC, this court
was fully cognizant of how Section 5.2 limited its authority to designate only "in the exercise of its authority[.]"
Indeed, this court could not have intended to overstep the constitutional limits of its authority.

III

A.M. No. 00-11-03-SC is not the only administrative issuance of this court specifying Regional Trial Court branches
which are to focus on certain types of cases, not because this court created or transformed them into special types of
courts in lieu of their being courts of general jurisdiction, but solely in the interest of expediency and efficiency.

In this court's August 1, 2000 Resolution in A.M. No. 00-8-01-SC,44 this court designated certain Regional Trial Court
branches as "Special Courts for drugs cases, which shall hear and decide all criminal cases in their respective
jurisdictions involving violations of the Dangerous Drugs Act [of] 1972 (R.A. No. 6425) as amended, regardless of the
quantity of the drugs involved."45

This court's Resolution in A.M. No. 00-8-01-SC made no pretenses that it was creating new courts of limited
jurisdiction or transforming Regional Trial Courts into courts of limited jurisdiction. Instead, it repeatedly referred to
its operational and administrative purpose: efficiency. Its preambular clauses emphasized that the designation of
Special Courts was being made because "public policy and public interest demand that [drug] cases ... be
expeditiously resolved[,]"46 and in view of "the consensus of many that the designation of certain branches of the
Regional Trial Courts as Special Courts to try and decide drug cases . . . may immediately address the problem of
delay in the resolution of drugs cases."47 Moreover, its dispositive portion provides that it was being adopted "pursuant
to Section 23 of [the Judiciary Reorganization Act of 1980], [and] in the interest of speedy and efficient administration
of justice[.]"48

Consistent with these operational and administrative aims, this court's October 11, 2005 Resolution in A.M. No. 05-9-
03-SC,49 which addressed the question of whether "special courts for dr[u]g cases [may] be included in the raffle of
civil and criminal cases other than drug related cases[,]" 50stated:chanRoblesvirtualLawlibrary

The rationale behind the exclusion of dr[u]g courts from the raffle of cases other than drug cases is to expeditiously
resolve criminal cases involving violations of [R.A. No.] 9165 (previously, of [R.A. No.] 6435). Otherwise, these
courts may be sidelined from hearing drug cases by the assignment of non-drug cases to them and the purpose of their
designation as special courts would be negated. The faithful observance of the stringent time frame imposed on drug
courts for deciding dr[u]g related cases and terminating proceedings calls for the continued implementation of the
policy enunciated in A.M. No. 00-8-01-SC.51cralawlawlibrary

To reiterate, at no point did this court declare the Regional Trial Court branches identified in these administrative
issuances as being transformed or converted into something other than Regional Trial Courts. They retain their status
as such and, along with it, the Judiciary Reorganization Act of 1980's characterization of them as courts of general
jurisdiction. However, this court, in the interest of facilitating operational efficiency and promoting the timely
dispensation of justice, has opted to make these Regional Trial Court branches focus on a certain class of the many
types of cases falling under their jurisdiction.

Having mentioned this court's Resolutions, which designated Regional Trial Court branches as so-called Drugs Courts,
it is crucial to draw the distinction between, on the one hand, this court's designation of certain Regional Trial Court
branches as such Drugs Courts, or (as is the subject of this case) Commercial Courts, and, on the other, this court's
designation of certain Regional Trial Court branches as so-called Family Courts.

Similarly through a Resolution in an Administrative Matter, this . court's February 1, 2000 Resolution in A.M. No. 99-
11-07-SC52 designated certain Regional Trial Court branches as Family Courts. As with Drugs Courts, this court
declared this designation of Family Courts to be "in the interest of the expeditious, effective and efficient
administration of justice[.]"53 This court further specified that this designation was in order "[t]o implement the
provisions of Section 17 of Republic Act No. 8369, otherwise known as the 'Family Courts Act of 1997[.]'" 54

This court's February 1, 2000 Resolution in A.M. No. 99-11-07-SC is, thus, an offshoot of the Family Courts Act of
1997. Section 3 of this statute did not add to, clarify, or make specific mention of the types of cases cognizable by
Regional Trial Courts. Rather, it created independent Family Courts that are distinct from Regional Trial Courts.
Section 5 spelled out the exclusive original jurisdiction of Family Courts, that is, subject matter jurisdiction that,
henceforth, was no longer within the jurisdiction of Regional Trial Courts. Parenthetically, it is well to emphasize that
the Family Courts Act of 1997 is a legislative enactment. Accordingly, it was well within its bounds to create courts
and define their jurisdiction.

Sections 3 and 5 of the Family Courts Act of 1997 provide:chanRoblesvirtualLawlibrary

SEC. 3. Establishment of Family Courts. - There shall be established a Family Court in every province and city in the
country. In case where the city is the capital of the province, the Family Court shall be established in the municipality
which has the highest population.

SEC. 5. Jurisdiction of Family Courts. - The Family Courts shall have exclusive original jurisdiction to hear and
decide the following cases:chanRoblesvirtualLawlibrary

a) Criminal cases where one or more of the accused is below eighteen (18) years of age but not less than nine (9) years
of age or where one or more of the victims is a minor at the time of the commission of the offense: Provided, That if
the minor is found guilty, the court shall promulgate sentence and ascertain any civil liability which the accused may
have incurred.

The sentence, however, shall be suspended without need of application pursuant to Presidential Decree No. 603,
otherwise known as the "Child and Youth Welfare Code";

b) Petitions for guardianship, custody of children, habeas corpus in relation to the latter;

c) Petitions for adoption of children and the revocation thereof;

d) Complaints for annulment of marriage, declaration of nullity of marriage and those relating to marital status and
property relations of husband and wife or those living together under different status and agreements, and petitions for
dissolution of conjugal partnership of gains;

e) Petitions for support and/or acknowledgment;

f) Summary judicial proceedings brought under the provisions of Executive Order No. 209, otherwise known as the
"Family Code of the Philippines";

g) Petitions for declaration of status of children as abandoned, dependent or neglected children, petitions for voluntary
or involuntary commitment of children; the suspension, termination, or restoration of parental authority and other
cases cognizable under Presidential Decree No. 603, Executive Order No. 56, (Series of 1986), and other related laws;

h) Petitions for the constitution of the family home;

i) Cases against minors cognizable under the Dangerous Drugs Act, as amended;

j) Violations of Republic Act No. 7610, otherwise known as the "Special Protection of Children Against Child Abuse,
Exploitation and Discrimination Act," as amended by Republic Act No. 7658; and

k) Cases of domestic violence against:chanRoblesvirtualLawlibrary

1) Women - which are acts of gender based violence that results, or are likely to result in physical, sexual or
psychological harm or suffering to women; and other forms of physical abuse such as battering or threats and coercion
which violate a woman's personhood, integrity and freedom of movement; and

2) Children - which include the commission of all forms of abuse, neglect, cruelty, exploitation, violence, and
discrimination and all other conditions prejudicial to their development.

If an act constitutes a criminal offense, the accused or batterer shall be subject to criminal proceedings and the
corresponding penalties.

If any question involving any of the above matters should arise as an incident in any case pending in the regular
courts, said incident shall be determined in that court.cralawlawlibrary

This court's designation of Family Courts through its February 1, 2000 Resolution in A.M. No. 99-11-07-SC was
pursuant to a transitory provision: Section 17 of the Family Courts Act of 1997. Section 17 required this court to, in
the meantime, designate Regional Trial Court branches to act as Family Courts. This designation was of a temporary
nature, effective only in the intervening period pending the establishment of Family
Courts:chanRoblesvirtualLawlibrary

SEC. 17. Transitory Provisions. - Pending the establishment of such Family Courts, the Supreme Court shall designate
from among the branches of the Regional Trial Court at least one Family Court in each of the cities of Manila,
Quezon, Pasay, Caloocan, Makati, Pasig, Mandaluyong, Muntinlupa, Laoag, Baguio, Santiago, Dagupan, Olongapo,
Cabanatuan, San Jose, Angeles, Cavite, Batangas, Lucena, Naga, Iriga, Legazpi, Roxas, Iloilo, Bacolod, Dumaguete,
Tacloban, Cebu, Mandaue, Tagbilaran, Surigao, Butuan, Cagayan de Oro, Davao, General Santos, Oroquieta, Ozamis,
Dipolog, Zamboanga, Pagadian, Iligan, and in such other places as the Supreme Court may deem necessary.

Additional cases other than those provided in Sec. 5 may be assigned to the Family Courts when their dockets permit:
Provided, That such additional cases shall not be heard on the same day family cases are heard.

In areas where there are no Family Courts, the cases referred to in Section 5 of this Act shall be adjudicated by the
Regional Trial Court.
cralawlawlibrary

This court's designation of Family Courts, insofar as there was a need to tentatively provide for specialized courts,
proceeded from the same mandate which animated its designation of Drugs Courts, as well as Special Commercial
Courts. It was pursuant to the power of this court to administratively supervise lower courts.

The status quo engendered by A.M. No. 99-11-07-SC persists to the present day, more than 15 years after its adoption
and almost 18 years after the adoption of the Family Courts Act of 1997. However, the delineation of the exclusive
original jurisdiction of Family Courts as against the subject matter jurisdiction of Regional Trial Courts remains. It is
just that, from the time of its enactment, the Family Courts Act of 1997 has not been fully implemented. This state of
affairs is a fact acknowledged by this court, as, on August 13, 2014, this court issued Memorandum Order No. 20-14
establishing a Committee on Family Courts and Juvenile Concerns, the mandate of which includes the drafting of a
plan for effecting the organization of Family Courts.

I have no doubt that this Committee, under the present and able leadership of Justice Teresita J. Leonardo-de Castro,
will do all it can to provide a workable and comprehensive plan that will convince Congress to create and fund the
statutorily mandated Family Courts. However, this temporary state of affairs can only be remedied by an act of
Congress. Hopefully, in due time, Congress can proceed to complete what is mandated by the Family Courts Act of
1997.

ACCORDINGLY, I vote to GRANT the Petition for Review on Certiorari. The Orders dated April 17, 2012 and July
9, 2012 of the Muntinlupa City Regional Trial Court, Branch 276, in Civil Case No. 11-077 must be REVERSED and
SET ASIDE.Instead of being dismissed, Civil Case No. 11-077, must be REFFERRED to the Executive Judge of the
Muntinlupa City Regional Trial Court, in order that it may be ASSIGNED to the Muntinlupa City Regional Trial
Court, Branch 256, the branch duly designated to perform the Muntinlupa City Regional Trial Court's functions as a
Special Commercial Court.