Cabutihan v. Landcenter Construction
REITERATIONFacts
The Antecedents: Respondent Landcenter Construction & Development Corporation (Landcenter) entered into an Agreement with Petitioner Rebecca T. Cabutihan, designating her as a "FACILITATOR" to arrange the recovery and financing of a parcel of land owned by Landcenter. As compensation, Cabutihan was to receive 20% of the total area recovered. Subsequently, a Deed of Undertaking was executed by Landcenter, acknowledging the assistance of Cabutihan and others (Wenifredo P. Forro, Nicanor Radan Sr., and Atty. Prospero A. Anave) in recovering and financing the property. This Deed stipulated that Landcenter would compensate them with specific percentages of the land area or proceeds, with Cabutihan receiving 20%, Forro 10%, Radan 4%, and Anave 2.5%, totaling 36.5%. Procedural History: Petitioner filed an action for specific performance with damages before the Regional Trial Court (RTC) of Pasig City, Branch 263, alleging that she had accomplished her undertakings and that Landcenter failed to execute the corresponding Deed of Assignment. Landcenter filed a Motion to Dismiss, arguing improper venue, lack of jurisdiction over the subject matter, and nonpayment of proper docket fees. The RTC dismissed the complaint, ruling that the action was a real action requiring filing in the court where the property is situated, that petitioner failed to implead necessary parties (her companions), and that proper docket fees based on the land's value were not paid. The Petition: Petitioner assailed the RTC's dismissal orders, arguing that the dismissal was erroneous on the grounds of improper venue, non-joinder of necessary parties, and non-payment of proper docket fees.
Issue(s)
Whether the RTC erred in dismissing the Complaint on the ground of improper venue. Whether the RTC erred in dismissing the Complaint on the ground of non-joinder of necessary parties. Whether the RTC erred in dismissing the Complaint on the ground of non-payment of proper docket fees.
Ruling
The Supreme Court granted the Petition, reversed and set aside the assailed Orders of the RTC, and remanded the case to the court of origin for further proceedings.
Ratio Decidendi
On the Issue of Proper Venue: The Court held that the action filed was a personal action, not a real action. While the ultimate goal was the conveyance of real property, the primary cause of action stemmed from the breach of contract, giving rise to a suit for specific performance. Citing La Tondeña Distillers, Inc. v. Ponferrada and Siasoco v. Court of Appeals, the Court clarified that an action for specific performance with damages is a personal action that may be filed in the court where any of the parties reside, even if the property involved is located elsewhere. The Court distinguished this from cases where the primary objective was to regain ownership and possession, making it a real action. On the Issue of Non-Joinder of Proper Parties: The Court ruled that neither misjoinder nor non-joinder of parties is a ground for dismissal of an action. According to Section 11, Rule 3 of the Rules of Court, parties may be dropped or added at any stage of the proceedings. The RTC should have ordered the joinder of the other claimants (Forro, Radan, and Anave) instead of dismissing the case. The Court noted that even without them, the case could proceed concerning petitioner's 20% share, making them necessary but not indispensable parties. The judgment would be without prejudice to their rights. On the Issue of Correct Docket Fees: The Court held that the RTC and respondent corporation used technicalities to avoid resolving the case. While Section 5, Rule 141 of the Rules of Court requires considering the assessed value of real estate for filing fees, this rule does not apply to an action for specific performance, which is classified as an action not capable of pecuniary estimation. The Court reiterated that the value of the real property subject of the contract is irrelevant in determining the filing fees for such an action. Furthermore, if monetary equivalent becomes the only solution, payment of fees can be allowed within a reasonable time.
Main Doctrine
A suit for breach of contract, seeking specific performance or rescission, is an action not capable of pecuniary estimation, and thus the assessed value of the real estate subject of the action should not be considered in computing the filing fees. Neither misjoinder nor non-joinder of parties is a ground for dismissal, as parties may be dropped or added at any stage of the proceedings.