Lizares v. Caluag
REITERATIONFacts
1. The Antecedents: Flaviano Cacnio purchased a lot on installment from Dr. Antonio A. Lizares, Inc. (petitioner). Cacnio made a downpayment and agreed to pay the balance in yearly installments with interest. Petitioner later sent Cacnio a letter demanding payment for arrears and land taxes, which Cacnio claimed was an overstatement of the amount due. Cacnio attempted to pay the alleged arrears with a check, but petitioner returned the check and refused the payment. Cacnio alleged that petitioner's refusal was without legal or equitable grounds and that petitioner threatened to repossess the lot. 2. Procedural History: Cacnio filed a civil case against petitioner in the Court of First Instance of Rizal, Quezon City Branch, seeking to compel petitioner to accept his payment, damages, attorney's fees, and a preliminary injunction to prevent repossession of the lot. Petitioner moved to dismiss the case, arguing that venue was improperly laid as the action affected title to and possession of real property located in Bacolod City. The trial court denied this motion. Petitioner then filed a petition for prohibition with the Court of Appeals, seeking to prohibit the trial court from proceeding with the case. The Court of Appeals dismissed this petition. 3. The Petition: Petitioner seeks a review of the Court of Appeals' decision via a petition for certiorari. The core issue presented to the Supreme Court is whether the action filed by Cacnio falls under Section 3 of Rule 5 of the Rules of Court, which mandates that actions affecting title to or recovery of possession of real property must be commenced and tried in the province where the property is located. Petitioner argues that despite Cacnio's claim of an action in personam, the underlying dispute concerns the title and possession of real property, making the venue in Quezon City improper.
Issue(s)
Whether the action to compel acceptance of payment and enjoin repossession of a property located in Bacolod City constitutes a personal action or a real action for purposes of determining the correct venue.
Ruling
The Supreme Court reversed the decision of the Court of Appeals and directed the respondent Judge to desist from taking further cognizance of Civil Case No. Q-5197. The Court held that venue was improperly laid and the Court of First Instance of Rizal, Quezon City Branch, should have granted the motion to dismiss.
Ratio Decidendi
On Issue 1: The Supreme Court held that the main case falls under Section 3, Rule 5 of the Rules of Court, which requires that actions affecting title to, or for recovery of possession of real property, be tried in the province where the property lies. Although the respondent argued the remedy was merely to compel acceptance of payment—a personal obligation—the Court determined that this relief was only a preliminary step to establish his title to the real property in Bacolod. The Court emphasized that the complaint was explicitly used as a means for the respondent to retain possession of said property against the petitioner's threats of repossession. In legal characterization, when the core of the dispute and the relief sought directly impact the right to possess or own land, the action is local and not transitory. The venue was, therefore, improperly laid in Quezon City, as the Court of First Instance (CFI) of Rizal lacked the authority to try a case fundamentally concerning land in Bacolod. Consequently, the motion to dismiss should have been granted, and the lower courts erred in treating the matter as a simple action in personam.
Main Doctrine
The Supreme Court reiterated that venue for actions concerning title to or recovery of possession of real property is strictly governed by the location of the property itself, as stipulated in Rule 5, Section 3 of the Rules of Court. This rule is based on the nature of the action, which is considered real property, and not merely personal. Even if the complaint seeks a personal remedy, if it is a preliminary step to asserting rights over real property, the venue must still be where the property is situated.