Gonzaga vs. Court of Appeals

A party who actively participates in the proceedings before a court, invoking its jurisdiction to secure affirmative relief, is estopped from later challenging that same court's jurisdiction, especially when the jurisdictional question is raised only after an adverse decision. While a judgment rendered without jurisdiction is a total nullity and may be assailed at any stage, active participation in the proceedings bars a party from attacking jurisdiction as a matter of public policy.

Petitioner-spouses Rene and Lerio Gonzaga purchased a parcel of land from private respondent Lucky Homes, Inc. in 1970, situated in Iloilo and containing an area of 240 square meters. The lot was specifically denominated as Lot No. 19 under Transfer Certificate of Title (TCT) No. 28254 and was mortgaged to the Social Security System (SSS) as security for their housing loan. The dispute concerned the mistaken identification of the lot by the private respondent and the subsequent foreclosure of Lot No. 19 by SSS.

Sometime in 1970, petitioner-spouses Rene and Lerio Gonzaga purchased a parcel of land from private respondent Lucky Homes, Inc., situated in Iloilo and containing an area of 240 square meters. The lot was specifically denominated as Lot No. 19 under Transfer Certificate of Title (TCT) No. 28254 and was mortgaged to the Social Security System (SSS) as security for their housing loan. Petitioners then started the construction of their house, not on Lot No. 19 but on Lot No. 18, as private respondent mistakenly identified Lot No. 18 as Lot No. 19.

Upon realizing its error, private respondent, through its general manager, informed petitioners of such mistake, but the latter offered to buy Lot No. 18 in order to widen their premises. Thus, petitioners continued with the construction of their house. However, petitioners defaulted in the payment of their housing loan from SSS. Consequently, Lot No. 19 was foreclosed by SSS, and petitioners' certificate of title was cancelled and a new one was issued in the name of SSS.

After Lot No. 19 was foreclosed, petitioners offered to swap Lot Nos. 18 and 19 and demanded from private respondent that their contract of sale be reformed and another deed of sale be executed with respect to Lot No. 18, considering that their house was built therein. However, private respondent refused. This prompted petitioners to file, on June 13, 1996, an action for reformation of contract and damages with the Regional Trial Court of Iloilo City, Branch 36, which was docketed as Civil Case No. 17115.

The trial court dismissed the complaint, concluding that what petitioners had bought from the defendant was Lot No. 19 covered by TCT No. 28254, which parcel of land had been properly indicated in the instruments and not Lot No. 18 as claimed by the plaintiffs. The trial court further held that the contracts being clear and unmistakable reflected the true intention of the parties, and since petitioners failed to assail the contracts on mutual mistake, the same need no longer be reformed. The trial court also noted that reformation or swapping was no longer feasible since petitioners were no longer the owners of Lot No. 19, and allowing such would result in unjust enrichment.

After the trial court issued a writ of execution on June 22, 1998, petitioners filed an urgent motion to recall the writ of execution on September 17, 1998, alleging for the first time that the court a quo had no jurisdiction to try the case as it was vested in the HLURB pursuant to PD 957. Petitioners also filed a new complaint against private respondent with the HLURB and, on June 30, 1999, filed before the Court of Appeals a petition for annulment of judgment premised on the ground that the trial court had no jurisdiction to try and decide Civil Case No. 17115.

• Abandonment of Tijam Doctrine: Petitioners claimed that the recent decisions of this Court have already abandoned the doctrine laid down in Tijam vs. Sibonghanoy.
• Lack of Jurisdiction: Petitioners contended that the Court of Appeals erred in dismissing the petition by applying the principle of estoppel, even if the Regional Trial Court, Branch 36 of Iloilo City had no jurisdiction to decide Civil Case No. 17115.

N/A — The decision does not recount the specific arguments raised by the respondents.

• Estoppel by Laches: Whether petitioners, who actively participated in the trial court proceedings without raising the issue of jurisdiction and only questioned it after an adverse decision, are estopped from assailing the trial court's jurisdiction.
• Applicability of Tijam Doctrine: Whether the doctrine laid down in Tijam vs. Sibonghanoy has been abandoned by recent decisions of this Court.

• Estoppel by Laches: Yes. Petitioners were estopped from questioning the trial court's jurisdiction, having themselves invoked it by instituting the action and actively participating in the proceedings for two years without raising any jurisdictional challenge.
• Applicability of Tijam Doctrine: No. The doctrine in Tijam vs. Sibonghanoy has not been abandoned and has been consistently reiterated in countless decisions, including Orosa vs. Court of Appeals, Ang Ping vs. Court of Appeals, Salva vs. Court of Appeals, National Steel Corporation vs. Court of Appeals, Province of Bulacan vs. Court of Appeals, and PNOC Shipping and Transport Corporation vs. Court of Appeals.

• Estoppel by Laches: The Court held that while an order or decision rendered without jurisdiction is a total nullity and may be assailed at any stage, active participation in the proceedings in the court which rendered the order or decision will bar such party from attacking its jurisdiction. The Court quoted Tijam vs. Sibonghanoy: "A party may be estopped or barred from raising a question in different ways and for different reasons. Thus we speak of estoppel in pais, or estoppel by deed or by record, and of estoppel by laches." The Court further quoted: "It has been held that a party cannot invoke the jurisdiction of a court to secure affirmative relief against his opponent and, after obtaining or failing to obtain such relief, repudiate, or question that same jurisdiction x x x x [T]he question whether the court had jurisdiction either of the subject matter of the action or of the parties was not important in such cases because the party is barred from such conduct not because the judgment or order of the court is valid and conclusive as an adjudication, but for the reason that such a practice can not be tolerated — obviously for reasons of public policy."

• Applicability of Tijam Doctrine: The Court found that in the case at bar, it was petitioners themselves who invoked the jurisdiction of the court a quo by instituting an action for reformation of contract against private respondents. Petitioners vigorously asserted their cause from start to finish during the proceedings before the trial court, which lasted for two years. Not even once did petitioners raise the issue of the court's jurisdiction during the entire proceedings. It was only after the trial court rendered its decision and issued a writ of execution against them in 1998 did petitioners first raise the issue of jurisdiction — and it was only because said decision was unfavorable to them. The Court concluded that petitioners thus effectively waived their right to question the court's jurisdiction over the case they themselves filed. The Court emphasized that petitioners cannot be allowed to profit from their omission to the damage and prejudice of the private respondent, and that public policy dictates that the Court must strongly condemn any double-dealing by parties who are disposed to trifle with the courts by deliberately taking inconsistent positions, in utter disregard of the elementary principles of justice and good faith.

• Estoppel by Laches — A party may be estopped or barred from raising a question of jurisdiction in different ways and for different reasons, including estoppel in pais, estoppel by deed or by record, and estoppel by laches. A party cannot invoke the jurisdiction of a court to secure affirmative relief against his opponent and, after obtaining or failing to obtain such relief, repudiate or question that same jurisdiction. The party is barred from such conduct not because the judgment or order of the court is valid and conclusive as an adjudication, but for the reason that such a practice cannot be tolerated for reasons of public policy. In this case, petitioners were estopped from questioning the trial court's jurisdiction because they themselves invoked it by filing the action and actively participated in the proceedings for two years without raising any jurisdictional challenge, only raising the issue after an adverse decision.

• "A party may be estopped or barred from raising a question in different ways and for different reasons. Thus we speak of estoppel in pais, or estoppel by deed or by record, and of estoppel by laches." — This passage from Tijam vs. Sibonghanoy defines the various forms of estoppel and establishes the foundation for the doctrine applied in this case.
• "It has been held that a party cannot invoke the jurisdiction of a court to secure affirmative relief against his opponent and, after obtaining or failing to obtain such relief, repudiate, or question that same jurisdiction x x x x [T]he question whether the court had jurisdiction either of the subject matter of the action or of the parties was not important in such cases because the party is barred from such conduct not because the judgment or order of the court is valid and conclusive as an adjudication, but for the reason that such a practice can not be tolerated — obviously for reasons of public policy." — This passage articulates the rationale behind the estoppel doctrine, explaining that a party is barred from questioning jurisdiction after invoking it, not because the judgment is valid, but because such practice cannot be tolerated for reasons of public policy.
• "This Court frowns upon the undesirable practice of a party submitting his case for decision and then accepting the judgment but only if favorable, and attacking it for lack of jurisdiction if not." — This statement expresses the Court's condemnation of the practice of raising jurisdictional issues only after receiving an unfavorable decision, which was the situation in this case.

• Tijam vs. Sibonghanoy, 23 SCRA 29 [1968] — Controlling precedent that established the doctrine of estoppel by laches, holding that a party who actively participates in court proceedings cannot later question the court's jurisdiction. The Court relied heavily on this case in denying the petition.
• Orosa vs. Court of Appeals, 329 SCRA 652 [2000] — Followed; affirmed the rule that a party's active participation in all stages of the case before the trial court effectively estops such party from later challenging that same court's jurisdiction.
• Ang Ping vs. Court of Appeals, 310 SCRA 343 [1999] — Followed; reiterated the Tijam doctrine on estoppel by laches.
• Salva vs. Court of Appeals, 304 SCRA 632 [1999] — Followed; reiterated the Tijam doctrine and was also cited for the principle that the Court must condemn double-dealing by parties who deliberately take inconsistent positions.
• National Steel Corporation vs. Court of Appeals, 302 SCRA 522 [1999] — Followed; affirmed the rule on estoppel by active participation in court proceedings.
• Province of Bulacan vs. Court of Appeals, 299 SCRA 442 [1998] — Followed; affirmed the rule on estoppel by active participation in court proceedings.
• PNOC Shipping and Transport Corporation vs. Court of Appeals, 297 SCRA 402 [1998] — Followed; affirmed the rule that a party's active participation in all stages of the case before the trial court effectively estops such party from later challenging that same court's jurisdiction.
• Zamboanga Electric Cooperative, Inc. vs. Buat, 243 SCRA 47 [1995] — Cited for the principle that the Court frowns upon the undesirable practice of a party submitting his case for decision and then accepting the judgment but only if favorable, and attacking it for lack of jurisdiction if not.

• PD 957 (The Subdivision and Condominium Buyers Protective Decree) — Petitioners alleged that jurisdiction over their case was vested in the Housing and Land Use Regulatory Board (HLURB) pursuant to this decree. The Court did not rule on the merits of this jurisdictional claim because petitioners were estopped from raising it.

Puno (Chairman), Panganiban, Sandoval-Gutierrez, and Morales, JJ., concurred.

N/A — No dissenting opinions were noted in the provided case text.