Quizon-Arciga v. Baluyut
REITERATIONFacts
The Antecedents: Respondent Jaycee P. Baluyut filed a complaint for judicial foreclosure of mortgage against petitioners Rita Quizon-Arciga and Relia Q. Arciga. The dispute stemmed from a loan of P500,000.00 with 8% monthly interest, secured by a real estate mortgage executed by Relia, using a Special Power of Attorney (SPA) granted by Rita, over a parcel of land. Petitioners argued that Relia lacked the authority to mortgage the property to the respondent, as the SPA allegedly only permitted her to mortgage it to a specific individual, Amelia G. Pineda, rendering the mortgage unenforceable against Rita's share. Procedural History: The Regional Trial Court (RTC), Branch 66, Capas, Tarlac, ruled in favor of the respondent, ordering petitioners to pay the loan with interest or face public auction of the property. The RTC later granted the motion for execution, confirmed the public sale of the property to the respondent, and issued a writ of possession. Petitioners filed an Omnibus Motion for nullification of the sale and reinstatement of possession, which the RTC denied for lack of jurisdiction, stating the decision had been fully implemented. Subsequently, petitioners filed a Petition for Annulment of Judgment with the Court of Appeals (CA), which was dismissed for failing to show they could not avail ordinary remedies, that the alleged fraud was extrinsic, or that the petition was not barred by laches. The CA also denied their motion for reconsideration. The Petition: Petitioners Rita Quizon-Arciga and Relia Q. Arciga filed a Petition for Review on Certiorari with the Supreme Court, assailing the CA's dismissal of their Petition for Annulment of Judgment. They contend that the RTC lacked jurisdiction to order the payment of the 8% monthly interest, deeming it unconscionable and void. Furthermore, they argue that the gross negligence of their previous counsel constitutes extrinsic fraud, and that the respondent's failure to state the assessed value of the property and pay the correct docket fees in the foreclosure complaint prevented the RTC from acquiring jurisdiction. The Supreme Court, however, found that the petitioners were estopped from questioning the RTC's jurisdiction due to their active participation in the proceedings and the significant delay in raising the issue.
Issue(s)
Whether the Court of Appeals (CA) correctly dismissed the Petition for Annulment of Judgment. Whether the gross negligence of petitioners' previous counsel constitutes extrinsic fraud. Whether the Regional Trial Court (RTC) acquired jurisdiction over the subject matter of the case, considering the alleged failure to state the assessed value of the property and pay the correct docket fees. Whether petitioners are estopped from questioning the RTC's jurisdiction.
Ruling
The Supreme Court denied the Petition for Review on Certiorari and affirmed the Resolutions of the Court of Appeals. The Court held that the CA correctly dismissed the petition for annulment of judgment.
Ratio Decidendi
On the issue of the dismissal of the Petition for Annulment of Judgment: The Court of Appeals (CA) correctly dismissed the Petition for Annulment of Judgment because the grounds raised were either not valid grounds for annulment or were raised too late in the proceedings. On the issue of extrinsic fraud: The Court reiterated that extrinsic fraud, as a ground for annulment of judgment, requires that the scheme preventing a party from having their day in court must have been devised by the prevailing litigant. Even assuming the counsel's gross negligence, this would not constitute extrinsic fraud because the alleged fraud was committed by their own lawyer, not by the respondent. Furthermore, the records showed that petitioners themselves decided not to appeal the RTC's decision because they intended to settle the civil aspect of the case. On the issue of jurisdiction over the subject matter: The Court agreed with the petitioners that the RTC might have lacked jurisdiction because the complaint for judicial foreclosure of mortgage, being a real action, did not allege the assessed value of the property, making it difficult to determine whether the RTC or the Municipal Trial Court had exclusive original jurisdiction. Courts cannot take judicial notice of the assessed or market value of land. However, the Court also noted that the grounds of gross negligence of counsel and lack of jurisdiction due to failure to state assessed value and pay docket fees were raised for the first time in the petitioners' motion for reconsideration before the CA, after their initial petition for annulment of judgment was dismissed. The CA correctly ruled that arguments raised for the first time in a motion for reconsideration cannot be considered. Moreover, the CA found that petitioners' failure to appeal was due to their intention to settle, not counsel's negligence. The lien on the judgment award was deemed sufficient to address the alleged failure to pay correct docket fees. On the issue of estoppel from questioning jurisdiction: Despite agreeing that the RTC might have lacked jurisdiction, the Court found that petitioners were already estopped from questioning it. The Court applied the principle of estoppel by laches, citing Lagundi v. Bautista and Tijam v. Sibonghanoy. Petitioners actively participated in all stages of the proceedings before the RTC, including presenting themselves as witnesses and not questioning the RTC's jurisdiction even when the decision became final and executory. They only opposed the issuance of the Writ of Possession and argued about the right to redeem and the void interest rate. They raised the issue of jurisdiction for the first time in their motion for reconsideration before the CA, twelve years after the filing of the complaint, which was deemed too late.
Main Doctrine
A party who actively participates in all stages of a case before challenging the jurisdiction of the lower court is estopped from invoking lack of jurisdiction, even if the complaint failed to allege the assessed value of the property, as the issue of jurisdiction should have been raised earlier.