De Jesus vs. Garcia

A complaint primarily seeking specific performance of a contract is not capable of pecuniary estimation and is within the original jurisdiction of the court of first instance, not a city court, even if the damages or monetary amounts claimed are within the inferior court's limit; and a city court may not issue preliminary or final injunctions absent an explicit statutory grant.

Respondent Maxima de Jesus was one of ten co-owners, together with petitioners Pablo, Engracia, and Manuela de Jesus, of six parcels of land along España, P. Campa, and Adelina Streets in Sampaloc, Manila. Maxima de Jesus acted as administratrix of the property and as attorney-in-fact for the co-owners, with a stipulated compensation of 10% of the rentals. Shell Company of the Philippines, Ltd. leased the property under an original lease dated August 23 and 29, 1953; the lease was renewed on January 10, 1966, increasing the monthly rental from P850.00 to P3,500.00 for the first ten years and P4,000.00 for the subsequent five years. Shell paid the rental by issuing a check in Maxima de Jesus's name, and she distributed the co-owners' shares.

Maxima de Jesus, assisted by her husband Salvador Barrios, was one of ten co-owners of six parcels of land along España, P. Campa, and Adelina Streets in Sampaloc, Manila. The co-owners included petitioners Pablo, Engracia, and Manuela de Jesus. Maxima de Jesus acted as administratrix of the property and as attorney-in-fact for her co-owners, with a stipulated compensation of 10% of the rentals. The monthly receipt signed by each co-owner acknowledged that 10% of the rentals had been deducted for her administration fee and for expenses concerning a collector and an attorney she might employ to increase rentals, prevent arrears, and eject stubborn tenants.

Shell Company of the Philippines, Ltd. was the lessee of the property. The original lease contract was dated August 23 and 29, 1953. Through Maxima de Jesus's efforts, the lease was renewed by an instrument executed on January 10, 1966, increasing the monthly rentals from P850.00 to P3,500.00 during the first ten years and P4,000.00 for the subsequent five years. Shell paid the rentals by issuing a check for P3,500.00 in the name of Maxima de Jesus, who then distributed the shares of the co-owners. On the basis of the P3,500.00 monthly rental, Manuela de Jesus and Pablo de Jesus were each entitled to 9/54, or P583.33, while Engracia de Jesus was entitled to 10/54, or P684.14, for a combined monthly amount of P1,850.80.

The verified complaint alleged that in October 1966 petitioners sought to unjustly deprive Maxima de Jesus of her 10% compensation and, to fraudulently escape that obligation, surreptitiously instructed Shell to pay their rental shares directly to them rather than through her. Shell, the complaint continued, was then vacillating over whether to change the forma de pago, leaving Maxima de Jesus allegedly deprived of her 10% compensation of P185.08 monthly.

On October 3, 1966, Maxima de Jesus filed her complaint in the City Court of Manila against petitioners and Shell. She prayed for a preliminary prohibitory injunction directing Shell not to change the existing mode of payment, and for a final injunction and judgment ordering the three individual defendants to pay her 10% compensation deducted from their combined P1,850.80 monthly rental shares pursuant to the existing forma de pago. On October 4, 1966, the respondent judge issued, ex parte and upon a P500.00 bond, a preliminary injunction ordering Shell and its representatives to refrain from modifying the forma de pago and directing Shell to pay the monthly rentals by check in the name of Maxima de Jesus alone, who would cash and distribute the amount among the ten co-owners after deducting 10%. Shell complied on the same date, delivering P3,500.00 to Maxima de Jesus for the October 1966 rental.

• Jurisdiction Over the Subject Matter: Petitioners argued that the City Court of Manila lacked jurisdiction over the complaint because the action primarily sought specific performance of contract, which is not capable of pecuniary estimation and therefore lay within the jurisdiction of the court of first instance.
• Power to Issue Injunction: Petitioners maintained that the City Court had no statutory power to issue the preliminary injunction, and that the writ should therefore be dissolved.

• Monetary Amount and Splitting: Respondents contended that the claim was merely to prevent Maxima de Jesus from being defrauded of her 10% compensation of only P185.08 for the October 1966 rental, and that if petitioners defrauded her in any future month, she could file a similar demand for that month.
• Preliminary Injunction Under Rule 58: Respondents argued that Section 2 of Rule 58 authorizes a preliminary injunction by the judge of "any court in which the action is pending," and that because the action was pending in the City Court, that court had jurisdiction to issue the preliminary injunction.

• Jurisdiction Over the Subject Matter: Whether the City Court of Manila had jurisdiction over the complaint, which sought to compel Shell to continue paying rentals through Maxima de Jesus and to compel the co-owners to pay her 10% compensation.
• Power to Issue Final Injunction: Whether the City Court had jurisdiction to hear and determine an action for a final injunction against Shell.
• Indivisibility and the Sum of Money Claim: Whether the City Court could take jurisdiction over the claim for P185.08 in compensation separately from the injunction suit.
• Power to Issue Preliminary Injunction: Whether the City Court had the power to issue the preliminary injunction under Section 2, Rule 58 of the Rules of Court.

• Jurisdiction Over the Subject Matter: No. The complaint primarily sought specific performance of contract, which is not capable of pecuniary estimation and is within the original jurisdiction of the court of first instance, not the City Court.
• Power to Issue Final Injunction: No. The City Court was without jurisdiction to hear and determine the case for final injunction against Shell; such authority is expressly granted by statute to courts of first instance.
• Indivisibility and the Sum of Money Claim: No. The money claim could not be divorced from the injunction suit because both were the subject of one indivisible complaint.
• Power to Issue Preliminary Injunction: No. The City Court lacked jurisdiction over the subject matter and also lacked an explicit statutory grant of power to issue the preliminary injunction.

• Jurisdiction Over the Subject Matter: Jurisdiction over the subject matter is conferred only by the Constitution or law; it cannot be fixed by the will of the parties, acquired through waiver, or conferred by the court's acquiescence. For inferior courts, jurisdiction is not presumed and must clearly appear from statute. The nature of an action is determined by the averments of the complaint taken as a whole. The complaint asked the court to compel Shell to continue the previous manner of payment and to compel the dissenting co-owners to pay the 10% compensation, which placed the action within the concept of specific performance of contract. Under Section 44(a) of the Judiciary Act of 1948, specific performance is not capable of pecuniary estimation and falls within the court of first instance's jurisdiction. The incidental claim for money did not give the litigation a pecuniary estimation; Manufacturer's Distributors, Inc. vs. Yu Siu Liong was followed on this point. Accordingly, the City Court had no jurisdiction over the subject matter.

• Power to Issue Final Injunction: The law does not grant city courts power to take cognizance of a case for final injunction. Section 44(h) of the Judiciary Act of 1948 expressly grants courts of first instance original jurisdiction over such actions. The final injunction sought against Shell therefore lay beyond the City Court's jurisdiction.

• Indivisibility and the Sum of Money Claim: Even if the claim against the co-owners were treated as one for only P185.08 for October 1966, the sum of money action could not be separated from the injunction suit because both were asserted in one complaint. Without a mandatory injunction directing Shell to issue checks in Maxima de Jesus's favor, collection of her alleged compensation would become problematical. The action was therefore indivisible, and City Court jurisdiction had to yield to the court of first instance. The breach charged was total and indivisible, so only one action for specific performance could be maintained; successive monthly actions were impermissible. Further, the complaint did not allege that the October 1966 rental was already due and payable when jurisdiction was sought.

• Power to Issue Preliminary Injunction: The City Court's power to issue preliminary injunctions is historically and statutorily limited. The original inferior-court statutes were silent on such power, and later legislation authorized it only in forcible entry cases. Under the last paragraph of Section 88 of the Judiciary Act of 1948, as amended, temporary injunctions outside forcible entry could be issued only by municipal courts in provincial capitals and solely in the absence of the district judge. Piit vs. de Lara was followed: a justice of the peace court could not issue a preliminary injunction in an illegal detainer case because the law limited the power to forcible entry. Section 2 of Rule 58 must be read in context; its last sentence, authorizing a Court of First Instance to grant an injunction in an action pending in an inferior court, indicates that the inferior court itself has no such power unless expressly authorized by statute. Moreover, because the City Court had no jurisdiction over the subject matter, it was powerless to grant an ancillary remedy. The plaintiff was not without remedy, as injunctive assistance could be sought from the court of first instance.

• Jurisdiction over the Subject Matter — Jurisdiction is conferred only by the Constitution or law. It cannot be fixed by the will of the parties, acquired through waiver, enlarged or diminished by any act or omission, or conferred by the court's acquiescence. The Court applied this rule to reject respondents' reliance on Rule 58 and to hold that the City Court's jurisdictional defect could not be cured by the parties' positions.
• Inferior Court Jurisdiction Not Presumed — The jurisdiction of an inferior court is not presumed and will not be upheld on doubtful inferences from statutes. Absent a statutory grant, neither convenience nor assumed justice can justify an inferior court's assumption of jurisdiction. The City Court had no statutory grant over specific performance or final injunction.
• Nature of Action Determined by the Complaint as a Whole — The averments of the complaint, taken as a whole, determine the nature of the action and the court's jurisdiction. The complaint's demands against Shell and the co-owners were read together as seeking compliance with their respective commitments and were thus classified as specific performance.
• Specific Performance Not Capable of Pecuniary Estimation — An action primarily for specific performance of contract is not capable of pecuniary estimation. A money claim that can be awarded only as a consequence of the specific performance primarily sought does not give the litigation a pecuniary estimation. Here, Maxima de Jesus's prayer for her 10% compensation was incidental to the primary relief of compelling continued performance.
• Incidental Monetary Claim Does Not Confer Inferior Court Jurisdiction — Where the principal action is for specific performance or injunction and the monetary amount is but an incident or consequence of the primary relief, the amount does not transfer jurisdiction to an inferior court, even if the amount is within that court's jurisdictional limit.
• Anti-Splitting and Total Breach — A total and indivisible breach gives rise to a single action; successive actions may not be maintained, and one action may not be split by isolating monthly monetary claims. The unqualified refusal to perform the contract went to the entire contract and required one specific performance action in the court of first instance.
• Ancillary Injunction Powers of Inferior Courts — A court without jurisdiction over the subject matter cannot grant an ancillary remedy. An inferior court's power to issue preliminary injunctions is limited to statutory authorization; Section 2, Rule 58 is procedural and does not confer substantive jurisdiction.

• "Jurisdiction over the subject matter is conferred only by the Constitution or law. It cannot be fixed by the will of the parties; it cannot be acquired through, or waived, enlarged or diminished by, any act or omission of the parties. Neither is it conferred by acquiescence of the court." — This states the foundational rule on subject-matter jurisdiction and underlies the Court's rejection of any attempt to vest the City Court with jurisdiction through Rule 58 or party consent.
• "The Court has no jurisdiction of a suit for specific performance of a contract, although the damages alleged for its breach, if permitted, are within the amount of which that court has jurisdiction." — The Court adopted this passage from Mebane Cotton Breeding St'n vs. Sides to explain why the claim for compensation did not give the City Court pecuniary jurisdiction over a specific performance suit.
• "That plaintiff's complaint also sought the payment by the defendant of P3,376.00 plus interest and attorney's fees, does not give a pecuniary estimation to the litigation, for the payment of such amounts can only be ordered as a consequence of the specific performance primarily sought." — Quoted from Manufacturer's Distributors, Inc. vs. Yu Siu Liong, this passage was applied to Maxima de Jesus's prayer for her 10% compensation as being merely incidental to specific performance.

• Manufacturer's Distributors, Inc. vs. Yu Siu Liong, G.R. No. L-21285, April 29, 1966 — Followed as directly analogous: the City Court of Manila had no jurisdiction over an action primarily seeking specific performance, even though the complaint also sought payment of a sum within the inferior court's monetary limit.
• Manila Railroad Co. vs. Attorney-General, 20 Phil. 523 — Cited with approval for the distinction between statutes conferring jurisdiction and rules governing procedure, emphasizing that procedural rules cannot restrict or expand substantive jurisdiction.
• Piit vs. de Lara, 58 Phil. 765 — Followed to establish that inferior courts may issue preliminary injunctions only as expressly authorized by statute; an illegal detainer case was outside the forcible entry authorization.
• Mebane Cotton Breeding St'n vs. Sides, 257 SW 302, 21 C.J.S. 59 — Adopted as authority that a court lacks jurisdiction over a suit for specific performance even if the damages alleged for its breach are within its jurisdictional amount.
• Blossom & Company, Inc. vs. Manila Gas Corporation, 55 Phil. 226 — Cited for the rule that an unqualified refusal to perform a contract is a total breach and may not be split into successive actions.

• Section 44(a), Judiciary Act of 1948 — Placed actions where the subject of the litigation is not capable of pecuniary estimation within the original jurisdiction of courts of first instance; specific performance was classified under this provision.
• Section 44(h), Judiciary Act of 1948 — Expressly granted courts of first instance original jurisdiction over actions for final injunction; this negated City Court jurisdiction over the final injunction sought against Shell.
• Section 88, Judiciary Act of 1948, as amended — Governed inferior court jurisdiction and contained no grant to city courts over actions for specific performance. Its last paragraph allowed temporary injunctions outside forcible entry only for municipal courts in provincial capitals in the absence of the district judge.
• Section 2, Rule 58, Rules of Court — Provided that a preliminary injunction may be granted by the judge of "any court in which the action is pending," but was read in context and did not confer substantive jurisdiction on the City Court.
• Sections 1 and 2, Article VIII, Constitution — Vested the apportionment of jurisdiction in Congress, showing that jurisdiction must come from law and cannot be supplied by rules of court.
• Section 13, Article VIII, Constitution — Limited the Supreme Court to promulgating rules concerning pleading, practice, and procedure; such rules must yield to substantive laws on jurisdiction.

Concepcion, C.J., Reyes, J.B.L., Dizon, Regala, Makalintal, Bengzon, J.P., Zaldivar, and Castro, JJ.