Soliven v. Fastforms Philippines, Inc.
REITERATIONFacts
The Antecedents: Petitioner Marie Antoinette R. Soliven filed a complaint for sum of money with damages against respondent Fastforms Philippines, Inc. for a loan of ₱170,000.00 obtained on June 2, 1993, payable within 21 days with 3% interest. Respondent issued a postdated check for ₱175,000.00 (principal plus interest). Respondent later advised petitioner not to deposit the check due to insufficient funds and proposed a "roll-over" with 5% monthly interest. Petitioner agreed. Respondent issued several checks totaling ₱76,250.00 for interest payments. Despite demands, respondent failed to pay the principal obligation and accrued interests. Procedural History: The Regional Trial Court (RTC), Branch 60, Makati City, rendered a Decision dated July 3, 1995, ordering respondent to pay petitioner ₱175,000.00 (loan and interest covered by the check), 5% monthly interest from June 25, 1993, less payments made, and attorney's fees. The RTC dismissed the complaint for moral and exemplary damages and the counterclaim. Respondent filed a motion for reconsideration, questioning the RTC's jurisdiction for the first time, alleging the principal demand did not exceed ₱200,000.00, thus falling under the Metropolitan Trial Court's (MeTC) jurisdiction per Republic Act No. 7691. The RTC denied the motion, citing the totality of the claim exceeding ₱200,000.00 and the principle of estoppel. On appeal, the Court of Appeals (CA) reversed the RTC's decision, ruling that the RTC lacked jurisdiction and that respondent could assail jurisdiction at any time. The CA denied petitioner's motion for reconsideration. The Petition: Petitioner filed a petition for review on certiorari with the Supreme Court, assailing the CA's decision and resolution.
Issue(s)
Whether the Regional Trial Court has jurisdiction over Civil Case No. 94-1788. Whether respondent is estopped from questioning the jurisdiction of the Regional Trial Court.
Ruling
The Supreme Court GRANTED the petition, REVERSED the Court of Appeals' Decision and Resolution, and AFFIRMED the Decision of the Regional Trial Court, Branch 60, Makati City, and its Resolution denying the motion for reconsideration.
Ratio Decidendi
On the issue of jurisdiction: The Court reiterated the provisions of Section 1 of Republic Act No. 7691 and Section 2 of Administrative Circular No. 09-94. RA 7691 vests exclusive original jurisdiction in the RTC for civil cases where the amount of the demand exceeds ₱200,000.00, exclusive of interest, damages, attorney's fees, litigation expenses, and costs. Conversely, the MeTC has jurisdiction when the demand does not exceed ₱200,000.00 under similar exclusions. Administrative Circular No. 09-94 clarifies that claims for damages are excluded in determining the jurisdictional amount only when they are incidental to or a consequence of the main cause of action. However, if the claim for damages is the main cause of action or one of the causes of action, it must be considered. In this case, the main cause of action was for the recovery of a sum of money amounting to ₱195,155.00, with the damages claimed being merely consequences of this principal cause of action. Therefore, based on the principal demand, the case should have been filed with the MeTC. On the issue of estoppel: Despite the initial determination that the MeTC had jurisdiction, the Court held that respondent is estopped from assailing the jurisdiction of the RTC. The Court emphasized that while jurisdiction may be raised at any stage, this rule presupposes that estoppel has not supervened. The records showed that respondent actively participated in all stages of the proceedings before the RTC and invoked its authority by seeking affirmative relief in its answer. Citing PNOC Shipping and Transport Corporation vs. Court of Appeals and Sta. Lucia Realty and Development, Inc. vs. Cabrigas, the Court ruled that such participation effectively bars a party by estoppel from challenging the court's jurisdiction, particularly after an adverse judgment has been rendered. A party cannot invoke the jurisdiction of a court to secure affirmative relief and then repudiate that same jurisdiction when the outcome is unfavorable. The Court frowns upon the practice of a party submitting to a judgment only if favorable and attacking it for lack of jurisdiction when adverse.
Main Doctrine
A party who actively participated in all stages of the proceedings before the trial court and invoked its authority by asking for affirmative relief is estopped from challenging the trial court's jurisdiction, even if the case was filed in the wrong court, especially when an adverse judgment has been rendered.