Hilario vs. Salvador

Jurisdiction over actions involving title to or possession of real property is determined by the assessed value of the property, not its market value. The assessed value is the fair market value multiplied by the assessment level, synonymous with taxable value, and is contained in the tax declaration. Where the assessed value does not exceed ₱20,000.00 (outside Metro Manila), the Municipal Trial Court has exclusive original jurisdiction; where it exceeds ₱20,000.00, the Regional Trial Court has jurisdiction.

The petitioners, Cesar, Ibarra, Nestor, Lina, and Prescilla, all surnamed Hilario, are co-owners by inheritance from Concepcion Mazo Salvador of a parcel of land designated as Cad. Lot No. 3113-part, located at Sawang, Romblon, Romblon. The property was adjudged as the hereditary share of their father, Brigido M. Hilario, Jr., when he was still single. The private respondent, Allan T. Salvador, is the grandson of the spouses Salustiano Salvador and Concepcion Mazo-Salvador, and claimed the property was their conjugal property. The case involves the application of Section 33 of Batas Pambansa Blg. 129, as amended by Republic Act No. 7691, which reallocated jurisdiction between the Regional Trial Courts and the lower courts based on the assessed value of real property.

The petitioners, Cesar, Ibarra, Nestor, Lina, and Prescilla, all surnamed Hilario, are co-owners by inheritance from Concepcion Mazo Salvador of a parcel of land designated as Cad. Lot No. 3113-part, located at Sawang, Romblon, Romblon. The property had been adjudged as the hereditary share of their father, Brigido M. Hilario, Jr., when he was still single, an adjudication known to their father's co-heirs. Sometime in 1989, the private respondent, Allan T. Salvador, constructed his dwelling unit of mixed materials on the property without the knowledge of the petitioners or their predecessors-in-interest. Demands were made for the private respondent to vacate the premises, but he manifested that he had asked the prior consent of their grandmother, Concepcion Mazo Salvador. The petitioners brought the matter to the Lupon of Barangay Sawang to reach a possible amicable settlement, but to no avail, as evidenced by the Certificate to File Action.

On September 3, 1996, the petitioners filed a complaint with the Regional Trial Court of Romblon, Romblon, Branch 71, against the private respondent. They alleged that the unjustified refusal of the defendant to vacate the property caused them shame, humiliation, wounded feelings, anxiety, and sleepless nights, and that they were constrained to engage the services of a lawyer. They prayed for an order for the defendant to vacate and peacefully turn over the occupied property, and for payment of actual damages (transportation expenses of ₱1,500.00 and ₱1,500.00 for each hearing schedule), attorney's fees of ₱20,000.00 plus ₱500.00 per court appearance, and moral and exemplary damages.

The private respondent filed a motion to dismiss on the ground of lack of jurisdiction over the nature of the action, citing Section 33 of B.P. Blg. 129, as amended by R.A. No. 7691. He averred that the complaint failed to state the assessed value of the land in dispute and did not sufficiently identify or describe the parcel of land, both essential requisites for determining jurisdiction. He surmised that the assessed value of the land could not exceed ₱20,000.00 and thus fell within the jurisdiction of the Municipal Trial Court of Romblon. The petitioners opposed the motion, contending that the RTC had jurisdiction since the court could take judicial notice of the market value of the property, which was ₱200.00 per square meter, and considering the property was 14,797 square meters, the total value was ₱3,500,000.00. They also argued that the motion to dismiss was premature.

On November 7, 1996, the RTC denied the motion to dismiss, holding that the action was incapable of pecuniary estimation and therefore cognizable by the RTC under Section 19(1) of B.P. Blg. 129, as amended. After the denial, the private respondent filed his answer with counterclaim, contending that the petitioners had no cause of action since the property was the conjugal property of his grandparents, the spouses Salustiano Salvador and Concepcion Mazo-Salvador. On April 8, 1997, Regidor and Virginia Salvador filed their Answer-in-Intervention, making common cause with the private respondent; Virginia Salvador was later dropped as intervenor on her own motion.

During trial, the petitioners adduced in evidence Tax Declaration No. 8590-A showing that in 1991 the property had an assessed value of ₱5,950.00. On June 3, 1999, the trial court rendered judgment in favor of the petitioners, ordering the defendant to vacate and peacefully turn over the occupied property to the plaintiffs and dismissing the defendant's counterclaim. The private respondent and respondent-intervenor Regidor Salvador appealed to the Court of Appeals, which reversed the RTC ruling and dismissed the complaint for want of jurisdiction, declaring that the action was one for recovery of ownership and possession of real property, and that absent any allegation of the assessed value of the property, the MTC had exclusive jurisdiction under Section 33 of R.A. No. 7691. The petitioners' motion for reconsideration was denied, prompting them to file the instant petition.

• Nature of the Action: Petitioners maintained that their action is an accion reinvindicatoria, an action incapable of pecuniary estimation, and thus, regardless of the assessed value of the subject property, exclusive jurisdiction falls within the RTC.
• Market Value of the Property: Petitioners argued that in their opposition to the motion to dismiss, they mentioned the increase in the assessed value of the land in question in the amount of ₱3.5 million, and that the court can take judicial notice of the market value of the property.
• Claim for Damages: Petitioners maintained that their action is also one for damages exceeding ₱20,000.00, over which the RTC has exclusive jurisdiction under R.A. No. 7691.
• Refiling of the Case: Petitioners argued that the CA committed serious reversible error in ordering the refiling of the case in the proper court instead of deciding the case on the merits based on the complete records elevated before the appellate court and in not affirming in toto the decision of the trial court.

• Lack of Jurisdiction: Private respondent argued that the complaint failed to state the assessed value of the land in dispute and did not sufficiently identify or describe the parcel of land, both essential requisites for determining the jurisdiction of the court, and that the assessed value of the land could not exceed ₱20,000.00, falling within the jurisdiction of the Municipal Trial Court.
• No Cause of Action: Private respondent contended that the petitioners had no cause of action against him since the property in dispute was the conjugal property of his grandparents, the spouses Salustiano Salvador and Concepcion Mazo-Salvador.

• Nature of the Action: Whether the petitioners' action is an accion reinvindicatoria (incapable of pecuniary estimation) or an accion publiciana (for recovery of possession of real property).
• Jurisdiction of the RTC: Whether the Regional Trial Court had jurisdiction over the action, considering the assessed value of the property in dispute.
• Effect of Claim for Damages: Whether the petitioners' claim for damages exceeding ₱20,000.00 confers jurisdiction upon the RTC.

• Nature of the Action: No. The action was an accion publiciana, or one for the recovery of possession of the right to possess, not an accion reinvindicatoria. The complaint did not involve a claim of ownership over the property; the petitioners alleged they were co-owners entitled to possession, and prayed that the private respondent vacate the property and restore possession thereof to them.
• Jurisdiction of the RTC: No. The RTC lacked jurisdiction. Jurisdiction over actions involving title to or possession of real property is determined by the assessed value of the property, not its market value. The tax declaration showed an assessed value of only ₱5,950.00, which is below the ₱20,000.00 threshold, placing the case within the exclusive original jurisdiction of the Municipal Trial Court under Section 33(3) of B.P. Blg. 129, as amended by R.A. No. 7691.
• Effect of Claim for Damages: No. The claim for damages does not confer jurisdiction upon the RTC. Section 33(3) of B.P. Blg. 129, as amended, explicitly excludes from the determination of the jurisdictional amount the demand for "interest, damages of whatever kind, attorney's fees, litigation expenses, and costs" where the damages are merely incidental to or a consequence of the main cause of action.

• Nature of the Action: The nature of the action and which court has original and exclusive jurisdiction over the same is determined by the material allegations of the complaint, the type of relief prayed for by the plaintiff, and the law in effect when the action is filed, irrespective of whether the plaintiffs are entitled to some or all of the claims asserted therein. The caption of the complaint is not determinative of the nature of the action, nor does jurisdiction depend upon the answer of the defendant or agreement of the parties. An accion reinvindicatoria is a suit which has for its object the recovery of possession over the real property as owner, involving recovery of ownership and possession based on said ownership. An accion publiciana, on the other hand, is one for the recovery of possession of the right to possess, also referred to as an ejectment suit filed after the expiration of one year after the occurrence of the cause of action or from the unlawful withholding of possession of the realty. The petitioners' complaint, filed on September 3, 1996, did not involve a claim of ownership over the property; they alleged they were co-owners entitled to possession, and that the private respondent constructed his house thereon in 1989 without their knowledge and refused to vacate despite demands. They prayed that the private respondent vacate the property and restore possession thereof to them. Thus, the action was an accion publiciana.
• Jurisdiction of the RTC: When the petitioners filed their complaint on September 3, 1996, R.A. No. 7691 was already in effect. Section 33(3) of the law grants the MTC exclusive original jurisdiction in all civil actions which involve title to, or possession of, real property, or any interest therein where the assessed value of the property or interest therein does not exceed ₱20,000.00 (or ₱50,000.00 in Metro Manila), exclusive of interest, damages of whatever kind, attorney's fees, litigation expenses, and costs. Section 19(2) grants the RTC jurisdiction over such actions where the assessed value exceeds ₱20,000.00. The jurisdiction of the court over an action involving title to or possession of land is now determined by the assessed value of the property, not the market value thereof. The assessed value of real property is the fair market value multiplied by the assessment level, synonymous with taxable value. The complaint did not contain an allegation stating the assessed value of the property, and the court cannot take judicial notice of the assessed or market value of lands. During trial, the petitioners adduced Tax Declaration No. 8590-A showing the assessed value of the property in 1991 was ₱5,950.00. Even assuming the assessed value was the same in 1995 or 1996, the MTC, and not the RTC, had jurisdiction since the case involved title to or possession of real property with an assessed value of less than ₱20,000.00. The tax declaration indicating the assessed value of the property enjoys the presumption of regularity as it has been issued by the proper government agency.
• Effect of Claim for Damages: The petitioners' argument that the claim for damages exceeding ₱20,000.00 confers jurisdiction upon the RTC is unavailing. Section 33(3) of B.P. Blg. 129, as amended, explicitly excludes from the determination of the jurisdictional amount the demand for "interest, damages of whatever kind, attorney's fees, litigation expenses, and costs." Administrative Circular No. 09-94, which sets the guidelines in the implementation of R.A. No. 7691, states that the exclusion of "damages of whatever kind" in determining the jurisdictional amount applies to cases where the damages are merely incidental to or a consequence of the main cause of action. Section 19(8) of B.P. Blg. 129, as amended, which grants the RTC jurisdiction over cases where the demand exceeds ₱100,000.00, is applicable only to "all other cases" other than an action involving title to, or possession of, real property in which the assessed value is the controlling factor in determining the court's jurisdiction. The damages claimed were merely incidental to, or a consequence of, the main cause of action for recovery of possession of real property. Since the RTC had no jurisdiction over the action, all the proceedings therein, including the decision of the RTC, are null and void, and the complaint should perforce be dismissed.

• Accion Reinvindicatoria vs. Accion Publiciana — An accion reinvindicatoria is a suit which has for its object the recovery of possession over the real property as owner; it involves recovery of ownership and possession based on said ownership. An accion publiciana is one for the recovery of possession of the right to possess, also referred to as an ejectment suit filed after the expiration of one year after the occurrence of the cause of action or from the unlawful withholding of possession of the realty. The Court applied this distinction to determine the nature of the petitioners' action, ruling that the complaint, which alleged co-ownership and prayed for possession, was an accion publiciana, not an accion reinvindicatoria.
• Jurisdiction Determined by Assessed Value — The jurisdiction of the court over an action involving title to or possession of land is determined by the assessed value of the property, not the market value thereof. The assessed value of real property is the fair market value multiplied by the assessment level, synonymous with taxable value, and is contained in the tax declaration. The Court applied this doctrine to hold that the RTC lacked jurisdiction because the assessed value of ₱5,950.00 was below the ₱20,000.00 threshold, placing the case within the exclusive original jurisdiction of the MTC.
• Determination of Jurisdiction Based on Material Allegations — The nature of the action and which court has original and exclusive jurisdiction over the same is determined by the material allegations of the complaint, the type of relief prayed for by the plaintiff, and the law in effect when the action is filed, irrespective of whether the plaintiffs are entitled to some or all of the claims asserted therein. The caption of the complaint is not determinative of the nature of the action, nor does jurisdiction depend upon the answer of the defendant or agreement of the parties. The Court applied this doctrine to reject the petitioners' characterization of their action as an accion reinvindicatoria.
• Exclusion of Incidental Damages from Jurisdictional Amount — The exclusion of the term "damages of whatever kind" in determining the jurisdictional amount under Section 19(8) and Section 33(1) of B.P. Blg. 129, as amended by R.A. 7691, applies to cases where the damages are merely incidental to or a consequence of the main cause of action. However, in cases where the claim for damages is the main cause of action, or one of the causes of action, the amount of such claim shall be considered in determining the jurisdiction of the court. The Court applied this doctrine to reject the petitioners' argument that their claim for damages conferred jurisdiction upon the RTC.

• "The jurisdiction of the court over an action involving title to or possession of land is now determined by the assessed value of the said property and not the market value thereof. The assessed value of real property is the fair market value of the real property multiplied by the assessment level. It is synonymous to taxable value." — This passage states the controlling doctrine on how jurisdiction is determined in actions involving title to or possession of real property, which is the ratio decidendi of the case.
• "Even a cursory reading of the complaint will show that it does not contain an allegation stating the assessed value of the property subject of the complaint. The court cannot take judicial notice of the assessed or market value of lands." — This passage establishes the requirement that the complaint must allege the assessed value of the property for jurisdictional purposes, and that courts cannot take judicial notice of such values.
• "It is the amount in the tax declaration that should be consulted and no other kind of value, and as appearing in Exhibit B, this is ₱5,950. The case, therefore, falls within the exclusive original jurisdiction of the Municipal Trial Court of Romblon which has jurisdiction over the territory where the property is located, and not the court a quo." — This passage, quoted with approval from the CA's disquisition, identifies the tax declaration as the controlling evidence of assessed value for jurisdictional purposes.

• Radio Communications of the Philippines, Inc. vs. Court of Appeals, G.R. No. 136109, 1 August 2002, 386 SCRA 67 — Cited as controlling precedent for the doctrine that the nature of the action and which court has original and exclusive jurisdiction is determined by the material allegations of the complaint, the type of relief prayed for, and the law in effect when the action is filed.
• Korea Exchange Bank vs. Filkor Business Integrated, Inc., G.R. No. 138292, 10 April 2002, 380 SCRA 381 — Cited as controlling precedent for the same doctrine on determining jurisdiction based on the material allegations of the complaint.
• Cruz vs. Torres, G.R. No. 121939, 4 October 1999, 316 SCRA 193 — Cited as controlling precedent for the distinction between accion reinvindicatoria and accion publiciana.
• Ouano vs. PGTT International Investment Corporation, G.R. No. 134230, 17 July 2002, 384 SCRA 589 — Cited as controlling precedent for the doctrines that the court cannot take judicial notice of the assessed or market value of lands, that the tax declaration enjoys the presumption of regularity, and that incidental damages are excluded from the jurisdictional amount.
• Aliabo vs. Carampatan, G.R. No. 128922, 16 March 2001, 354 SCRA 548 — Cited as supporting authority for the ruling that the MTC, not the RTC, had jurisdiction over the action given the assessed value of the property.

• Section 33(3), Batas Pambansa Blg. 129, as amended by Republic Act No. 7691 — Grants the Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts exclusive original jurisdiction in all civil actions which involve title to, or possession of, real property, or any interest therein where the assessed value of the property or interest therein does not exceed ₱20,000.00 (or ₱50,000.00 in Metro Manila), exclusive of interest, damages of whatever kind, attorney's fees, litigation expenses, and costs. The Court applied this provision to hold that the MTC, not the RTC, had jurisdiction over the petitioners' action.
• Section 19(2), Batas Pambansa Blg. 129, as amended by Republic Act No. 7691 — Grants the Regional Trial Court exclusive original jurisdiction in all civil actions which involve the title to, or possession of, real property, or any interest therein, where the assessed value of the property involved exceeds ₱20,000.00 (or ₱50,000.00 in Metro Manila), except actions for forcible entry into and unlawful detainer of lands or buildings. The Court applied this provision to determine that the RTC lacked jurisdiction because the assessed value did not exceed the threshold.
• Section 19(8), Batas Pambansa Blg. 129, as amended by Republic Act No. 7691 — Grants the Regional Trial Court exclusive original jurisdiction in all other cases in which the demand, exclusive of interest, damages of whatever kind, attorney's fees, litigation expenses, and costs, or the value of the property in controversy exceeds ₱100,000.00 (or ₱200,000.00 in Metro Manila). The Court held this provision is applicable only to "all other cases" other than an action involving title to, or possession of, real property in which the assessed value is the controlling factor.
• Section 199, Republic Act No. 7160 — Defines assessed value as the fair market value of the real property multiplied by the assessment level, synonymous with taxable value. The Court cited this provision to define the term "assessed value" for jurisdictional purposes.
• Administrative Circular No. 09-94 — Sets the guidelines in the implementation of R.A. No. 7691, stating that the exclusion of "damages of whatever kind" in determining the jurisdictional amount applies to cases where the damages are merely incidental to or a consequence of the main cause of action. The Court applied this circular to reject the petitioners' argument that their claim for damages conferred jurisdiction upon the RTC.

Puno (Chairman), Austria-Martinez, Tinga, and Chico-Nazario, JJ., concurred.