Sarsaba v. Vda.

De Te represented by Attorney-in-Fact Faustino Castaneda

G.R. No. 175910 July 30, 2009
FACTS: - A Decision was rendered in NLRC Case entitled, Patricio Sereno v. Teodoro
Gasing/Truck Operator, finding Sereno to have been illegally dismissed and ordering
Gasing to pay him his monetary claims in the amount of P43,606.47. After the Writ of Execution was returned unsatisfied, Labor Arbiter Newton R.
Sancho issued an Alias Writ of Execution, directing Fulgencio R. Lavarez, Sheriff II of
NLRC, to satisfy the judgment award. Lavarez, accompanied by Sereno and his counsel, petitioner Atty. Rogelio E.
Sarsaba, levied a Fuso Truck bearing License Plate No. LBR-514, which at that time
was in the possession of Gasing. Said truck was sold at public auction, with Sereno
appearing as highest bidder. Meanwhile, respondent Fe Vda. de Te, represented by her attorney-in-fact, Faustino
Castaeda, filed with the RTC a Complaint for recovery of motor vehicle, damages
with prayer for the delivery of the truck pendente lite against petitioner, Sereno,
Lavarez and the NLRC. She alleged the ff: (1) she is the wife of the late Pedro Te, the
registered owner of the truck; (2) Gasing merely rented the truck from her; (3)
Lavarez erroneously assumed that Gasing owned the truck because he was, at the
time of the "taking," in possession of the same; and (4) since neither she nor her
husband were parties to the labor case between Sereno and Gasing, she should not
be made to answer for the judgment award, much less be deprived of the truck as a
consequence of the levy in execution. Petitioner filed a Motion to Dismiss on the ff. grounds: (1) respondent has no legal
personality to sue, having no real interests over the property subject of the instant
complaint; (2) the allegations in the complaint do not sufficiently state that the
respondent has cause of action; (3) the allegations in the complaint do not contain
sufficient cause of action as against him; and (4) the complaint is not accompanied
by an Affidavit of Merit and Bond that would entitle the respondent to the delivery
of the truck pendente lite. The NLRC also filed a Motion to Dismiss on the grounds of lack of jurisdiction and
lack of cause of action. Meanwhile, Lavarez filed an Answer with Compulsory Counterclaim and Third-Party
Complaint. By way of special and affirmative defenses, he asserted that the RTC
does not have jurisdiction over the subject matter and that the complaint does not
state a cause of action. RTC issued an Order denying petitioner's Motion to Dismiss for lack of merit. -

Petitioner denied the material allegations in the complaint. Lavarez filed a Motion
for Inhibition which was opposed by respondent. RTC issued an Order of inhibition and directed the transfer of the records. RTC
issued another Order denying the separate motions to dismiss filed by NLRC and
Lavarez.
Petitioner filed an Omnibus Motion to Dismiss the Case on the ff grounds: (1) lack of
jurisdiction over one of the principal defendants; and (2) to discharge respondents
attorney-in-fact for lack of legal personality to sue. Respondent Fe Vda. De Te DIED. Respondent, through her lawyer, Atty. William G.
Carpentero, filed an Opposition, contending that the failure to serve summons upon
Sereno is not a ground for dismissing the complaint, because the other defendants
have already submitted their respective responsive pleadings. RTC issued the assailed Order denying petitioners Omnibus Motion to Dismiss. Petitioner then filed a Motion for Reconsideration with Motion for Inhibition in which
he claimed that the judge who issued the Order was biased and partial. Petitioner then directly sought recourse from the SC via the present petition
involving purely questions of law, which he claimed were resolved by the RTC
contrary to law and existing jurisprudence. Petitioner submits pure questions of law involving the effect of non-service of
summons following the death of the person to whom it should be served, and the
effect of the death of the complainant during the pendency of the case. Petitioner
argues that, since Sereno died before summons was served on him, the RTC should
have dismissed the complaint against all the defendants and that the same should
be filed against his estate. Petitioner asks that the complaint should be dismissed, not only against Sereno,
but as to all the defendants, considering that the RTC did not acquire jurisdiction
over the person of Sereno. Petitioner also moves that respondent's attorney-in-fact, Faustino Castaeda, be
discharged as he has no more legal personality to sue on behalf of Fe Vda. de Te,
who passed away on April 12, 2005, during the pendency of the case before the
RTC.
ISSUE: (Relevant in this topic) Effect of Death of party
RULING: Jurisdiction over a party is acquired by service of summons by the sheriff,
his deputy or other proper court officer, either personally by handing a copy thereof
to the defendant or by substituted service. On the other hand, summons is a writ by
which the defendant is notified of the action brought against him. Service of such

writ is the means by which the court may acquire jurisdiction over his person.
Petitioner raises the issue of lack of jurisdiction over the person of Sereno, not in his
Motion to Dismiss or in his Answer but only in his Omnibus Motion to Dismiss.
Having failed to invoke this ground at the proper time, that is, in a motion to
dismiss, petitioner cannot raise it now for the first time on appeal. The court's
failure to acquire jurisdiction over one's person is a defense which is personal to the
person claiming it. Obviously, it is now impossible for Sereno to invoke the same in
view of his death. Neither can petitioner invoke such ground, on behalf of Sereno, so
as to reap the benefit of having the case dismissed against all of the defendants.
Failure to serve summons on Sereno's person will not be a cause for the dismissal of
the complaint against the other defendants, considering that they have been served
with copies of the summons and complaints and have long submitted their
respective responsive pleadings.
In fact, the other defendants in the complaint were given the chance to raise all
possible defenses and objections personal to them in their respective motions to
dismiss and their subsequent answers. Patricio Sereno died before the summons,
together with a copy of the complaint and its annexes, could be served upon him.
However, the failure to effect service of summons unto Patricio Sereno, one of the
defendants herein does not render the action DISMISSIBLE, considering that the
three (3) other defendants, namely, Atty. Rogelio E. Sarsaba, Fulgencio Lavares and
the NLRC, were validly served with summons and the case with respect to the
answering defendants may still proceed independently. Be it recalled that the three
(3) answering defendants have previously filed a Motion to Dismiss the Complaint
which was denied by the Court. Hence, only the case against Patricio Sereno will be
DISMISSED and the same may be filed as a claim against the estate of Patricio
Sereno, but the case with respect to the three (3) other accused will proceed.
As for the issue regarding the respondents attorney-in-fact, While it may be true as
alleged by defendants that with the death of Plaintiff, Fe Vda. de Te, the Special
Power of Attorney she executed empowering the Attorney-in-fact, Faustino
Castaeda to sue in her behalf has been rendered functus officio, however, this
Court believes that the Attorney-in-fact had not lost his personality to prosecute this
case. Records reveal that the Attorney-in-fact has testified long before in behalf of
the said plaintiff and more particularly during the state when the plaintiff was
vehemently opposing the dismissal of the complainant. Subsequently thereto, he
even offered documentary evidence in support of the complaint, and this court
admitted the same. When this case was initiated, jurisdiction was vested upon this
Court to try and hear the same to the end. Well-settled is the rule to the point of
being elementary that once jurisdiction is acquired by this Court, it attaches until
the case is decided. Thus, the proper remedy here is the Substitution of Heirs and
not the dismissal of this case which would work injustice to the plaintiff.
SEC. 16, RULE 3

provides for the substitution of the plaintiff who dies pending hearing of the case by
his/her legal heirs. As to whether or not the heirs will still continue to engage the
services of the Attorney-in-fact is another matter, which lies within the sole
discretion of the heirs
Ruben Reinoso Jr. v. CA G.R. No. 116121 July 18, 2011
FACTS: Before the Court is a petition for review assailing the May 20, 1994
Decision[1] and June 30, 1994 Resolution[2] of the Court of Appeals (CA), in CA-G.R.
CV No. 19395, which set aside the March 22, 1988 Decision of the Regional Trial
Court, Branch 8, Manila (RTC) for non-payment of docket fees. The dispositive
portion of the CA decision reads:
IN VIEW OF ALL THE FOREGOING, the decision appealed from is SET ASIDE and
REVERSED and the complaint in this case is ordered DISMISSED.
No costs pronouncement.SO ORDERED.
The complaint for damages arose from the collision of a passenger jeepney and a
truck at around 7:00 oclock in the evening of June 14, 1979 along E. Rodriguez
Avenue, Quezon City. As a result, a passenger of the jeepney, Ruben Reinoso, Sr.
(Reinoso), was killed. The passenger jeepney was owned by Ponciano Tapales
(Tapales) and driven by Alejandro Santos (Santos), while the truck was owned by
Jose Guballa (Guballa) and driven by Mariano Geronimo (Geronimo).
On November 7, 1979, the heirs of Reinoso (petitioners) filed a complaint for
damages against Tapales and Guballa. In turn, Guballa filed a third party complaint
against Filwriters Guaranty Assurance Corporation (FGAC) under Policy Number OV09527.
On March 22, 1988, the RTC rendered a decision in favor of the petitioners and
against Guballa.
ISSUE: w/n the payment in full of the docket fees within the prescribed period is
mandatory?
RULING: The rule is that payment in full of the docket fees within the prescribed
period is mandatory. In
Manchester v. Court of Appeals,
it was held that a court acquires jurisdiction over any case only upon the payment
of the prescribed docket fee. The strict application of this rule was, however, relaxed
two (2) years after in the case of Sun
Insurance Office, Ltd. v. Asuncion,

wherein the Court decreed that where the initiatory pleading is not accompanied by
the payment of the docket fee, the court may allow payment of the fee within a
reasonable period of time, but in no case beyond the applicable prescriptive or
reglamentary period. This ruling was made on the premise that the plaintiff had
demonstrated his willingness to abide by the rules by paying the additional docket
fees required. Thus, in the more recent case of
United Overseas Bank v. Ros,
the Court explained that where the party does not deliberately intend to defraud
the court in payment of docket fees, and manifests its willingness to abide by the
rules by paying additional docket fees when required by the court, the liberal
doctrine enunciated in Sun Insurance Office, Ltd., and not the strict regulations set
in Manchester, will apply. It has been on record that the Court, in several instances,
allowed the relaxation of the rule on non-payment of docket fees in order to afford
the parties the opportunity to fully ventilate their cases on the merits. In the case of
La Salette College v. Pilotin
, the Court stated: Notwithstanding the mandatory nature of the requirement of
payment of appellate docket fees, we also recognize that its strict application is
qualified by the following: first, failure to pay those fees within the reglementary
period allows only discretionary, not automatic, dismissal; second, such power
should be used by the court in conjunction with its exercise of sound discretion in
accordance with the tenets of justice and fair play, as well as with a great deal of
circumspection in consideration of all attendant circumstances. While there is a
crying need to unclog court dockets on the one hand, there is, on the other, a
greater demand for resolving genuine disputes fairly and equitably, for it is far
better to dispose of a case on the merit which is a primordial end, rather than on a
technicality that may result in injustice. In this case, it cannot be denied that the
case was litigated before the RTC and said trial court had already rendered a
decision. While it was at that level, the matter of non-payment of docket fees was
never an issue. It was only the CA which motu propio dismissed the case for said
reason. Considering the foregoing, there is a need to suspend the strict application
of the rules so that the petitioners would be able to fully and finally prosecute their
claim on the merits at the appellate level rather than fail to secure justice on a
technicality, for, indeed, the general objective of procedure is to facilitate the
application of justice to the rival claims of contending parties, bearing always in
mind that procedure is not to hinder but to promote the administration of justice
As the Court has taken the position that it would be grossly unjust if Ps claim would
be dismissed on a strict application of the
Manchester doctrine

, the appropriate action, under ordinary circumstances, would be for the Court to
remand the case to the CA. Considering, however, that the case at bench has been
pending for more than 30 years and the records thereof are already before the
Court, a remand of the case to the CA would unnecessarily prolong its resolution. In
the higher interest of substantial justice and to spare the parties from further delay,
the Court will resolve the case on the merits.
PRIMER ON COURT JURISDICTION AND FILING FEES
SOURCE: HOME GUARANTY CORPORATION VS. R-II BUILDERS INC., AND
NATIONAL HOUSING AUTHORITY (G.R. NO. 192649, 9 MARCH 2011,
PEREZ, J.) SUBJECTS: JURISDICTION OF COURTS, HOW DETERMINED; FILING
FEES IN CONNECTION WITH AMENDED COMPLAINT; CAN COURT WITHOUT
JURISDICTION RE-RAFFLE CASE TO ANOTHER COURT? (BRIEF TITLE: HOME
GUARANTY VS. R-11 BUILDERS ET AL.)

WHAT IS THE DEFINITION OF JURISDICTION?

JURISDICTION IS DEFINED AS THE AUTHORITY TO HEAR AND DETERMINE A
CAUSE OR THE RIGHT TO ACT IN A CASE.[37]

HOW IS JURISDICTION OVER A SUBJECT MATTER DETERMINED?

BY ALLEGATIONS IN THE COMPLAINT, THE LAW AND RELIEF BEING SOUGHT.
The rule is settled that a courts jurisdiction over the subject matter is determined
by the relevant allegations in the complaint, [39] the law in effect when the action is
filed,[40] and the character of the relief sought irrespective of whether the plaintiff is
entitled to all or some of the claims asserted. [41]

HOW DOES COURT ACQUIRE JURISDICTION OVER A CASE?

ONLY UPON PAYMENT OF THE PRESCRIBED FILING AND DOCKET FEES.
Consistent with Section 1, Rule 141 of theRevised Rules of Court which provides
that the prescribed fees shall be paid in full upon the filing of the pleading or other
application which initiates an action or proceeding, the well-entrenched rule is to
the effect that a court acquires jurisdiction over a case only upon the payment of
the prescribed filing and docket fees. [42]

RTC, A DESIGNATED SPECIAL COMMERCIAL COURT, FOUND OUT THAT IT

HAS NO JURISDICTION OVER THE CASE SINCE RTC SAID THE SUBJECT
MATTER IS NOT INTRA-CORPORATE. IT ORDERED A RERAFFLE OF THE CASE.
IS RTC CORRECT?
NO. RTC SHOULD HAVE ORDERED THE DISMISSAL OF THE COMPLAINT,
SINCE A COURT WITHOUT JURISDICTION OVER THE SUBJECT MATTER
CANNOT TRANSFER THE CASE TO ANOTHER COURT.[51] INSTEAD, IT
SHOULD HAVE SIMPLY ORDERED THE DISMISSAL OF THE COMPLAINT,
CONSIDERING THAT THE AFFIRMATIVE DEFENSES FOR WHICH HGC SOUGHT
HEARING INCLUDED ITS LACK OF JURISDICTION OVER THE CASE.
A RE-RAFFLE WHICH CAUSES A TRANSFER OF THE CASE INVOLVES
COURTS WITH THE SAME SUBJECT MATTER JURISDICTION; IT CANNOT
INVOLVE COURTS WHICH HAVE DIFFERENT JURISDICTIONS EXCLUSIVE OF
THE OTHER. MORE APT IN THIS CASE, A RE-RAFFLE OF A CASE CANNOT
CURE A JURISDICTIONAL DEFECT.
The record shows that R-II Builders original complaint dated 23 August 2005 was
initially docketed as Civil Case No. 05-113407 before Branch 24 of the Manila, a
designated Special Commercial Court.[43] With HGCs filing of a motion for a
preliminary hearing on the affirmative defenses asserted in its answer [44] and R-II
Builders filing of its Amended and Supplemental Complaint dated 31 July 2007,
[45]
said court issued an order dated 2 January 2008 ordering the re-raffle of the case
upon the finding that the same is not an intra-corporate dispute. [46] In a clarificatory
order dated 1 February 2008,[47] the same court significantly took cognizance of its
lack of jurisdiction over the case in the following wise:
At the outset, it must be stated that this Court is a designated Special
Commercial Court tasked to try and hear, among others, intra-corporate
controversies to the exclusion of ordinary civil cases.
When the case was initially assigned to this Court, it was classified as an
intra-corporate case. However, in the ensuing proceedings relative to the
affirmative defences raised by defendants, even the plaintiff conceded that the
case is not an intra-corporate controversy or even if it is, this Court is without
authority to hear the same as the parties are all housed in Quezon City.
Thus, the more prudent course to take was for this Court to declare that it
does not have the authority to hear the complaint it being an ordinary civil
action. As to whether it is personal or civil, this Court would rather leave the
resolution of the same to Branch 22 of this Court. (Italics supplied).
We find that, having squarely raised the matter in its Rule 65 petition
for certiorari and prohibition docketed as CA-G.R. SP No. 111153, [48] HGC correctly
faults the CA for not finding that Branch 24 of the Manila RTC had no authority to

order the transfer of the case to respondent RTC. [49] Being outside the jurisdiction of
Special Commercial Courts, the rule is settled that cases which are civil in nature,
like the one commenced by R-II Builders, should be threshed out in a regular court.
[50]
With its acknowledged lack of jurisdiction over the case, Branch 24 of the Manila
RTC should have ordered the dismissal of the complaint, since a court without
subject matter jurisdiction cannot transfer the case to another court. [51] Instead, it
should have simply ordered the dismissal of the complaint, considering that the
affirmative defenses for which HGC sought hearing included its lack of jurisdiction
over the case.
Calleja v. Panday,[52] while on facts the other way around, i.e., a branch of the RTC
exercising jurisdiction over a subject matter within the Special Commercial Courts
authority, dealt squarely with the issue:
Whether a branch of the Regional Trial Court which has no jurisdiction to try and
decide a case has authority to remand the same to another co-equal Court in order
to cure the defects on venue and jurisdiction.
Calleja ruled on the issue, thus:
Such being the case, RTC Br. 58 did not have the requisite authority or power to
order the transfer of the case to another branch of the Regional Trial Court. The
only action that RTC-Br. 58 could take on the matter was to dismiss the petition for
lack of jurisdiction.
Certainly, the pronouncement of Br. 24, the Special Commercial Court, in its Joint
Order of 2 January 2008 that the case is not an intracorporate controversy,
amplified in its Order of 1 February 2008 that it does not have the authority to hear
the complaint it being an ordinary civil action is incompatible with the directive for
the re-raffle of the case and to leave the resolution of the same to Branch 22 of
this Court. Such a directive is an exercise of authority over the case, which
authority it had in the same breath declared it did not have. What compounds the
jurisdictional error is the fact that at the time of its surrender of jurisdiction, Br. 24
had already acted on the case and had in fact, on 26 October 2005, issued the writ
of preliminary injunction sought by herein respondent R-II Builders. At that point,
there was absolutely no reason which could justify a re-raffle of the case considering
that the order that was supposed to have caused the re-raffle was not an inhibition
of the judge but a declaration of absence of jurisdiction. So faulty was the order of
re-raffle that it left the impression that its previously issued preliminary injunction
remained effective since the case from which it issued was not dismissed but
merely transferred to another court. A re-raffle which causes a transfer of the case
involves courts with the same subject matter jurisdiction; it cannot involve courts
which have different jurisdictions exclusive of the other. More apt in this case, a reraffle of a case cannot cure a jurisdictional defect.

R-2 BUILDERS FILED A COMPLAINT, THEN AN AMENDED AND

SUPPLEMENTAL COMPLAINT. WHEN ASSESSMENT OF FILING FEE WAS
MADE, R-2 BUILDERS WITHREW ITS AMENDED AND SUPPLEMENTAL
COMPLAINT AND FILED A SECOND AMENDED COMPLAINT APPARENTLY TO
AVOID PAYING HUGE FILING FEES. IS THIS CORRECT?
NO BECAUSE IT IS CLEAR THAT THE INTENTION OF R-2 BUILDERS IS TO
EVADE PAYMENT OF FILING FEES. DECISIONS HAD BEEN CONSISTENTLY
PREMISED ON THE WILLINGNESS OF THE PARTY TO PAY THE CORRECT
DOCKET FEES AND/OR ABSENCE OF INTENTION TO EVADE PAYMENT OF THE
CORRECT DOCKET FEES. THIS CANNOT BE SAID OF R-II BUILDERS WHICH
NOT ONLY FAILED TO PAY THE CORRECT DOCKET FEES FOR ITS ORIGINAL
COMPLAINT AND AMENDED AND SUPPLEMENTAL COMPLAINT BUT ALSO
CLEARLY EVADED PAYMENT OF THE SAME BY FILING ITS SECOND AMENDED
COMPLAINT.
The importance of filing fees cannot be over-emphasized for they are intended to
take care of court expenses in the handling of cases in terms of costs of supplies,
use of equipment, salaries and fringe benefits of personnel, and others, computed
as to man-hours used in the handling of each case. The payment of said fees,
therefore, cannot be made dependent on the result of the action taken without
entailing tremendous losses to the government and to the judiciary in particular.
[80]
For non-payment of the correct docket fees which, for real actions, should be
computed on the basis of the assessed value of the property, or if there is none, the
estimated value thereof as alleged by the claimant, [81] respondent RTC should have
denied admission of R-II Builders Second Amended Complaint and ordered the
dismissal of the case. Although a catena of decisions rendered by this Court
eschewed the application of the doctrine laid down in the Manchester case,[82] said
decisions had been consistently premised on the willingness of the party to pay the
correct docket fees and/or absence of intention to evade payment of the correct
docket fees. This cannot be said of R-II Builders which not only failed to pay the
correct docket fees for its original complaint and Amended and Supplemental
Complaint but also clearly evaded payment of the same by filing its Second
Amended Complaint.
By itself, the propriety of admitting R-II Builders Second Amended Complaint is also
cast in dubious light when viewed through the prism of the general prohibition
against amendments intended to confer jurisdiction where none has been acquired
yet. Although the policy in this jurisdiction is to the effect that amendments to
pleadings are favored and liberally allowed in the interest of justice, amendment is
not allowed where the court has no jurisdiction over the original complaint and the
purpose of the amendment is to confer jurisdiction upon the court. [83] Hence, with
jurisdiction over the case yet to properly attach, HGC correctly fault the CA for
upholding respondent RTCs admission of R-II Builders Second Amended
Complaint despite non-payment of the docket fees for its original complaint

and Amended and Supplemental Complaint as well as the clear intent to evade
payment thereof.
WHAT IS THE RULE ON FILING FEES?
JURISDICTION OVER ANY CASE IS ACQUIRED ONLY UPON PAYMENT OF THE
PRESCRIBED DOCKET FEE. THIS IS BOTH MANDATORY AND
JURISDICTIONAL. THE BASIS IS THE CASE OF MANCHESTER DEVELOPMENT
CORPORATION VS. CA.
Applying the rule that a case is deemed filed only upon payment of the docket fee
regardless of the actual date of filing in court in the landmark case of Manchester
Development Corporation v. Court of Appeals,[76] this Court ruled that jurisdiction
over any case is acquired only upon the payment of the prescribed docket fee which
is both mandatory and jurisdictional.

WAS THERE A SUBSEQUENT RULING?

YES, IN THE CASE OF SUN INSURANCE OFFICE LTD VS. ASUNCION, THE
COURT RULED THAT IF THE COURT MAKES AN AWARD NECESSITATING AN
INCREASE IN FILING FEE SUCH CORRESPONDING FILING FEE IS A LIEN ON
THE JUDGMENT.
To temper said ruling (Manchester case) , the Court subsequently issued the
following guidelines in Sun Insurance Office, Ltd. v. Hon. Maximiano Asuncion,
[77]
viz.:
1. It is not simply the filing of the complaint or appropriate initiatory pleading,
but the payment of the prescribed docket fee, that vests a trial court with
jurisdiction over the subject matter or nature of the action. Where the filing of the
initiatory pleading is not accompanied by payment of the docket fee, the court may
allow payment of the fee within a reasonable time but in no case beyond the
applicable prescriptive or reglementary period.
2. The same rule applies to permissive counterclaims, third-party claims and
similar pleadings, which shall not be considered filed until and unless the filing fee
prescribed therefor is paid. The court may also allow payment of said fee within a
reasonable time but also in no case beyond its applicable prescriptive or
reglementary period.
3. Where the trial court acquires jurisdiction over a claim by the filing of the
appropriate pleading and payment of the prescribed filing fee but, subsequently,
the judgment awards a claim not specified in the pleading, or if specified the same
has been left for determination by the court, the additional filing fee therefor shall
constitute a lien on the judgment. It shall be the responsibility of the Clerk of Court

or his duly authorized deputy to enforce said lien and assess and collect the
additional fee