Pamaran v. Bank of Commerce
REITERATIONFacts
The Antecedents: Rosa Pamaran (Rosa) alleged that she owned a residential house constructed in 1987 on two lots owned by her children, Rhodora Pamaran and spouses Rosemary and Leonardo Bernabe. These lots were mortgaged by her children to Bank of Commerce (Bankcom) in 1997-1998 to secure loans obtained by Southmarine International Ltd. Co. Rosa claimed Bankcom was aware of her house, did not include it in the loan valuation, and did not obtain her consent for the mortgage. Subsequently, the lots were foreclosed, and ownership was consolidated in favor of Bankcom. Bankcom then filed petitions for writs of possession, which were granted by the RTC of Muntinlupa City in late 2011. In February 2012, Rosa was dispossessed of her house. Procedural History: Rosa filed a Complaint dated February 27, 2012, before the Regional Trial Court of Olongapo City (RTC Olongapo) for "Damages and Restitution of Value of a Residential House Unlawfully Taken," praying for P3 million in damages for the value of her house, P300,000.00 for violation of her rights, and P100,000.00 for attorney's fees. Bankcom filed an Answer with Compulsory Counterclaim, raising affirmative defenses including lack of cause of action, collateral attack on its title, interference with the jurisdiction of RTC Muntinlupa, and improper venue. Bankcom argued that Rosa was not a party to the mortgage contracts and that the mortgage included improvements. Rosa, in her Reply, asserted she did not authorize the mortgage of her house and that the real estate mortgage (REM) covered only the lots, not her house, which was owned by a third party. She clarified that she did not question the writs of possession but Bankcom's use of them to dispossess her of her house. She maintained the action was personal and the venue proper as she resided in Olongapo City. Rosa passed away on September 10, 2012, and her heirs substituted her. On December 10, 2012, RTC Olongapo granted Bankcom's motion to dismiss based on affirmative defenses. Petitioners' motion for reconsideration was denied on February 4, 2013. The Petition: Petitioners filed a Petition for Review on Certiorari before the Supreme Court, assailing the dismissal of their Complaint. They argued that the RTC Olongapo erred in resolving the issue of lack of cause of action based on evidence aliunde, instead of solely on the complaint's allegations, which should be hypothetically admitted. They contended that the RTC erred in disregarding the rule that a movant for dismissal on lack of cause of action hypothetically admits the plaintiff's factual representations. Petitioners also claimed the RTC erred in resolving a question of fact without giving them an opportunity to present evidence and in using such factual conclusion to justify dismissal. Lastly, they argued the RTC erred in dismissing the complaint on the ground that it interfered with the jurisdiction of the RTC Muntinlupa in ex parte proceedings for a writ of possession.
Issue(s)
Whether the RTC Olongapo erred in resolving the issue of lack of cause of action on the basis of evidence aliunde, instead of solely on the allegations in the complaint, and in disregarding the jurisprudential rule that a movant to dismiss on the ground of lack of cause of action is deemed to have hypothetically admitted the plaintiff's factual representation in the complaint. Whether the RTC Olongapo committed procedural error by resolving a question of fact in favor of the respondent without giving petitioners the opportunity to present evidence, and using such conclusion to justify dismissal. Whether the RTC Olongapo erred in justifying the dismissal of the complaint on the thesis that its initiation interfered with the exercise of jurisdiction of a co-equal court in ex parte proceedings for the issuance of a writ of possession under Act 3135.
Ruling
The Supreme Court granted the Petition, reversed and set aside the December 10, 2012 and February 4, 2013 Orders of the RTC Olongapo, reinstated the Complaint, and remanded the case to the RTC Olongapo for resolution with dispatch.
Ratio Decidendi
On Issue 1: The Court held that the RTC Olongapo erred in dismissing the Complaint based on Bankcom's affirmative defenses, which were treated as a motion to dismiss for failure to state a cause of action. Such a motion must be resolved solely on the basis of the allegations in the complaint, assuming them to be true. The RTC should not have considered evidence aliunde or inquired into the truthfulness of the allegations, as this would deny the plaintiff her right to due process. The Court reiterated that a motion to dismiss under Section 1(g) of Rule 16 is a preliminary objection made before trial, and the court must hypothetically admit the truth of the allegations to determine if the relief prayed for may be granted based on them. The RTC's conclusion that the REM included the house, based on the mortgage documents, required the examination of evidence, which is beyond the scope of a motion to dismiss for failure to state a cause of action. On Issue 2: The Court found that the RTC Olongapo erred in resolving a question of fact without giving the petitioners the opportunity to present evidence. The determination of whether Rosa had a right over the house and whether Bankcom violated this right required a full-blown trial where evidence could be presented and contravened. The RTC's premature resolution of these factual matters on a motion to dismiss constituted a procedural error and a denial of due process. On Issue 3: The Court ruled that the RTC Olongapo's justification for dismissal, based on the Complaint interfering with the jurisdiction of the RTC Muntinlupa, was unjustified. The Court clarified that the Complaint was a personal action for damages arising from Bankcom's alleged violation of Rosa's constitutional rights to due process and enjoyment of her property, not a real action seeking to invalidate the writs of possession. The nature of the actions, the laws relied upon (Article 32 of the Civil Code for the damage suit versus Act 3135 for the writ of possession), and the reliefs sought were distinct. Therefore, the personal action for damages was properly filed in RTC Olongapo, where Rosa resided, and did not interfere with the RTC Muntinlupa's jurisdiction over the real property.
Main Doctrine
The Supreme Court reiterated that a motion to dismiss for failure to state a cause of action must be resolved strictly on the basis of the allegations in the complaint, assuming them to be true. The Court emphasized that the trial court erred in considering evidence aliunde and in disregarding the hypothetical admission of the complaint's factual assertions. Moreover, the Court clarified that an action for damages stemming from the violation of constitutional rights, even if it involves property, is a personal action and not a real action, thus determining the proper venue based on the plaintiff's residence.