Roldan v. Barrios
REITERATIONFacts
The Antecedents: Petitioner Alona G. Roldan filed a complaint for foreclosure of real estate mortgage against respondents Spouses Clarence I. Barrios and Anna Lee T. Barrios, and Rommel Matorres. Roldan alleged that the Spouses Barrios borrowed P250,000.00 on October 13, 2008, payable within one year with a 5% monthly interest, secured by a real estate mortgage on a parcel of land. The loan became overdue starting February 2011, and the Spouses Barrios allegedly mortgaged the same property again to Matorres in June 2012. Roldan sought payment of the principal, accumulated interest, attorney's fees, and exemplary damages, with a prayer for the sale of the mortgaged property in case of default. Procedural History: The Spouses Barrios filed an Answer, contesting the loan computation and asserting a need to suspend proceedings due to a filed petition for rehabilitation. Matorres also filed an Answer, admitting the mortgage to him and stating he had filed a separate judicial foreclosure case for the same property. On July 22, 2014, the Regional Trial Court (RTC), Branch 6, Kalibo, Aklan, dismissed both Civil Case No. 9811 (Roldan's case) and Civil Case No. 9642 (Matorres' case) for lack of jurisdiction, finding that the assessed value of the property (P13,380.00) placed it within the jurisdiction of the first-level courts. The RTC denied Roldan's and Matorres' subsequent motions for reconsideration. The Petition: Petitioner Roldan filed a petition for certiorari before the Supreme Court, assailing the RTC's dismissal orders. She argued that a foreclosure of real estate mortgage is an action incapable of pecuniary estimation, thus falling under the exclusive original jurisdiction of the RTC. Respondent Matorres joined Roldan's position. Respondents Spouses Barrios, however, raised issues regarding Roldan's alleged violation of the Tax Reform Act and her money-lending activities. The Supreme Court considered the direct resort to it permissible as the case involved a pure question of law regarding court jurisdiction.
Issue(s)
Whether the RTC committed grave abuse of discretion in dismissing the foreclosure cases for lack of jurisdiction. Whether an action for foreclosure of real estate mortgage is an action incapable of pecuniary estimation, and if so, does that determination override the specific provisions of BP 129 regarding assessed value in determining jurisdiction.
Ruling
The petition is dismissed. The Court finds no grave abuse of discretion committed by the Regional Trial Court in dismissing the complaint for lack of jurisdiction. The dispositive portion of the RTC's Order dated July 22, 2014, dismissing Civil Cases Nos. 9642 and 9811 for lack of jurisdiction, is affirmed.
Ratio Decidendi
On the issue of grave abuse of discretion: The RTC correctly determined that the foreclosure of real estate mortgage was a real action. The assessed value of the mortgaged property was P13,380.00, which is below the P20,000.00 threshold for RTC jurisdiction under Section 33(3) of BP 129. Therefore, the first level court, not the RTC, had exclusive original jurisdiction over the case. The RTC's dismissal for lack of jurisdiction was thus proper and did not constitute grave abuse of discretion. While a direct resort to the Supreme Court is generally improper, it may be allowed when the issue involves a pure question of law, such as the court's jurisdiction, and when strict adherence to the rule of hierarchy would not be necessary. In this case, the issue of jurisdiction was a legal question, justifying the petitioner's direct recourse to the Supreme Court. On the issue of jurisdiction based on pecuniary estimation vs. assessed value: The Court reiterated that jurisdiction over the subject matter is conferred by law and is determined by the nature of the cause of action and the relief sought. Batas Pambansa Blg. 129, as amended by Republic Act No. 7691, delineates the jurisdiction of the RTC and the first level courts. Specifically, Section 19 of BP 129 grants RTCs exclusive original jurisdiction in all civil actions where the subject of litigation is incapable of pecuniary estimation, and in civil actions involving title to, or possession of, real property where the assessed value exceeds P20,000.00 (or P50,000.00 in Metro Manila). Conversely, Section 33(3) of BP 129 vests exclusive original jurisdiction in first level courts for civil actions involving title to, or possession of, real property where the assessed value does not exceed P20,000.00 (or P50,000.00 in Metro Manila). While an action for foreclosure of mortgage is generally considered a real action and, in principle, may be classified as an action incapable of pecuniary estimation, its jurisdictional aspect, particularly when involving title to or possession of real property, is specifically governed by the assessed value of the property. The Court addressed the petitioner's reliance on Russell v. Vestil, which stated that foreclosure of mortgage is an action incapable of pecuniary estimation. While acknowledging this principle, the Court emphasized that the specific provisions of BP 129, as amended, mandate that for actions involving title to or possession of real property, the assessed value determines jurisdiction. The Russell case itself, in its latter part, clarified that even if an action is incapable of pecuniary estimation, if it involves title to or possession of real property, the jurisdiction is determined by the assessed value, placing it under the purview of the first level courts if the value is below the threshold.
Main Doctrine
A petition for foreclosure of real estate mortgage is a real action where the jurisdiction of the court is determined by the assessed value of the property involved. If the assessed value does not exceed P20,000.00 (or P50,000.00 in Metro Manila), the first level courts have jurisdiction; otherwise, the Regional Trial Courts have jurisdiction. An action for foreclosure of mortgage, while considered an action incapable of pecuniary estimation in principle, is specifically governed by the assessed value of the property when it involves title to or possession of real property.