Malana vs. Tappa

Jurisdiction over an action to quiet title is determined by the assessed value of the real property involved, not by Rule 63 of the Rules of Court. The permissive word "may" in Rule 63, Section 1 does not confer jurisdiction on the RTC; rather, the mandatory provisions of the Judiciary Reorganization Act of 1980, as amended by Republic Act No. 7691, vest exclusive original jurisdiction in the MTC over real actions where the assessed value does not exceed ₱20,000.00 (or ₱50,000.00 in Metro Manila).

Petitioners are heirs of Anastacio Danao, who died intestate, and claim ownership over a parcel of land in Tuguegarao City covered by Transfer Certificate of Title No. T-127937. Respondents are family members of Consuelo Pauig, whom Anastacio had allowed to build on and occupy the southern portion of the property during his lifetime under an agreement that she would vacate when Anastacio or his heirs needed the land. The dispute is governed by the jurisdictional framework of Republic Act No. 7691, which amended Batas Pambansa Blg. 129 (the Judiciary Reorganization Act of 1980) and reallocated jurisdiction over real actions between the RTC and the MTC based on the assessed value of the property.

Petitioners Carmen Danao Malana, Leticia Danao, Maria Danao Acorda, Evelyn Danao, Fermina Danao, and Leonora Danao are heirs of Anastacio Danao, who died intestate, and claim ownership of a parcel of land in Tuguegarao City, Cagayan, covered by Transfer Certificate of Title No. T-127937. During his lifetime, Anastacio allowed Consuelo Pauig, who was married to Joaquin Boncad, to build on and occupy the southern portion of the property, under an agreement that Consuelo would vacate the land whenever Anastacio or his heirs might need it.

After Consuelo's death, respondents — her family members — continued to occupy the subject property and built their residences thereon using permanent materials. Benigno Tappa, Consuelo's son-in-law, built a house on the disputed property and leased it to an unidentified individual; Jerry Reyna, Consuelo's grandson, built a house of permanent materials where he and his family reside; Saturnino Cambri, married to Consuelo's granddaughter Nelly Quizan Cambri, built a house within the subject land; and spouses Francisco and Maria Ligutan, the latter being Consuelo's daughter, also lived in a house of permanent materials on the lot. Petitioners later learned that respondents were claiming ownership over the subject property. Averring that they already needed the property, petitioners demanded that respondents vacate it, but respondents refused.

Petitioners referred the dispute to the Lupong Tagapamayapa of Barangay Annafunan West for conciliation. During the conciliation proceedings, respondents asserted ownership and presented documents ostensibly supporting their claim. According to petitioners, these documents were highly dubious, falsified, and incapable of proving respondents' claim of ownership; nevertheless, they created a cloud upon petitioners' title. Petitioners thus filed before the RTC a Complaint for Reivindicacion, Quieting of Title, and Damages, seeking actual damages of ₱50,000.00 for respondents' baseless claim in violation of Article 19 of the Civil Code, exemplary damages of ₱50,000.00 for bad faith, and ₱50,000.00 as attorney's fees. The RTC found that the assessed value of the subject property per Tax Declaration No. 02-48386 was only ₱410.00, and dismissed the Complaint motu proprio for lack of jurisdiction.

• Principal Cause of Action: Petitioners argued that their principal cause of action was for quieting of title, and that the accion reivindicacion was included merely to enable them to seek complete relief from respondents; therefore, the Complaint should not have been dismissed since Section 1, Rule 63 of the Rules of Court states that an action to quiet title falls under the jurisdiction of the RTC.
• Joinder of Causes of Action: Petitioners contended, citing Rumarate vs. Hernandez, that there was no obstacle to joining the two causes of action — quieting of title and reivindicacion — in a single Complaint, and that even if the causes of action could not be joined, misjoinder was not a ground for dismissal.
• Grave Abuse of Discretion: Petitioners raised the sole issue of whether the respondent judge committed grave abuse of discretion in dismissing the Complaint motu proprio.

N/A — The decision does not recount the respondents' arguments, as the case was dismissed before respondents could file their answer.

• Jurisdiction over Quieting of Title: Whether an action to quiet title is a real action whose jurisdiction is determined by the assessed value of the property under Republic Act No. 7691, such that the MTC, not the RTC, has exclusive original jurisdiction where the assessed value does not exceed ₱20,000.00.
• Propriety of Declaratory Relief: Whether petitioners' Complaint for quieting of title could be treated as a petition for declaratory relief under Rule 63, Section 1 of the Rules of Court, given that respondents had already breached or violated petitioners' rights before the filing of the action.
• Grave Abuse of Discretion in Motu Proprio Dismissal: Whether the RTC committed grave abuse of discretion amounting to lack or excess of jurisdiction in dismissing the Complaint motu proprio for lack of jurisdiction.

• Jurisdiction over Quieting of Title: No. An action to quiet title is a real action, and pursuant to Section 33(3) of the Judiciary Reorganization Act of 1980, as amended by Republic Act No. 7691, the MTC exercises exclusive original jurisdiction over real actions where the assessed value of the property does not exceed ₱20,000.00. Since the subject property's assessed value was only ₱410.00, the MTC, not the RTC, had jurisdiction.
• Propriety of Declaratory Relief: No. An action for declaratory relief presupposes that there has been no actual breach of the instruments involved or of rights arising thereunder. Because petitioners had already been deprived of possession and respondents had expressly claimed ownership, the proper remedy was accion publiciana or accion reivindicatoria, not declaratory relief.
• Grave Abuse of Discretion in Motu Proprio Dismissal: No. The RTC acted in complete accord with law and jurisprudence in dismissing the Complaint motu proprio, as lack of jurisdiction over the subject matter cannot be cured by the silence, acquiescence, or express consent of the parties, and a court may dismiss an action ex mero motu when it has no jurisdiction.

• Jurisdiction over Quieting of Title: The Court distinguished the two paragraphs of Section 1, Rule 63 of the Rules of Court. The first paragraph describes the general circumstances for filing a petition for declaratory relief before the RTC. The second paragraph refers to actions for reformation of an instrument, quieting of title, and consolidation of ownership under Article 1607 of the Civil Code — remedies considered similar to declaratory relief because they result in adjudication of legal rights without the need for execution. To determine which court has jurisdiction over these actions, the provision must be read together with the Judiciary Reorganization Act of 1980, as amended. The Court noted that Rule 63, Section 1 uses the permissive word "may," which denotes that the provision is merely permissive and indicates a mere possibility, an opportunity, or an option. In contrast, the mandatory provision of the Judiciary Reorganization Act uses "shall" and explicitly requires the MTC to exercise exclusive original jurisdiction over all civil actions involving title to or possession of real property where the assessed value does not exceed ₱20,000.00. Since the assessed value of the subject property was only ₱410.00, the complaint was within the exclusive original jurisdiction of the MTC.
• Propriety of Declaratory Relief: The Court held that a petition for declaratory relief may be entertained only before the breach or violation of the statute, deed, or contract to which it refers. Where the law or contract has already been contravened prior to the filing of the action, the courts can no longer assume jurisdiction. In this case, petitioners' Complaint was filed after they had already demanded and respondents had refused to vacate the subject property, and only after respondents expressly claimed ownership before the Lupong Tagapamayapa in direct challenge to petitioners' title. Since petitioners averred that they had already been deprived of possession, the proper remedy was accion publiciana (a suit for recovery of possession filed one year after the cause of action) or accion reivindicatoria (a suit for recovery of possession as owner). Jurisdiction over such an action depends on the value of the property involved, and given the ₱410.00 assessed value, the MTC had jurisdiction.
• Grave Abuse of Discretion in Motu Proprio Dismissal: Citing Laresma vs. Abellana, the Court reiterated that the nature of an action and the jurisdiction of a tribunal are determined by the material allegations of the complaint and the law at the time the action was commenced. Jurisdiction is conferred only by law and not by consent or waiver. Lack of jurisdiction cannot be cured by silence, acquiescence, or even express consent of the parties, and a court may dismiss an action ex mero motu or motu proprio. Since the RTC acted in complete accord with law and jurisprudence, it cannot be said to have committed grave abuse of discretion. An act may only be considered grave abuse of discretion when performed in a capricious or whimsical exercise of judgment equivalent to lack of jurisdiction — so patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform a duty enjoined by law. No such circumstances existed to justify the issuance of a writ of certiorari.

• Jurisdiction determined by material allegations and assessed value — The nature of an action and the jurisdiction of a tribunal are determined by the material allegations of the complaint and the law at the time the action was commenced. Jurisdiction over the subject matter is conferred only by law, not by consent or waiver of the parties. In this case, the Court applied this principle to hold that the petitioners' complaint, which alleged deprivation of possession, was a real action whose jurisdiction depended on the assessed value of the property (₱410.00), placing it within MTC jurisdiction.
• Declaratory relief requires no prior breach — An action for declaratory relief may be entertained only before the breach or violation of the statute, deed, or contract to which it refers. Its purpose is to secure an authoritative statement of the parties' rights and obligations for their guidance, not to settle issues arising from an alleged breach. Where the law or contract has already been contravened before the filing of the action, the court has no more jurisdiction over the action. The Court applied this to find that petitioners' remedy was accion reivindicatoria, not declaratory relief, because respondents had already refused to vacate and had claimed ownership.
• Motu proprio dismissal for lack of jurisdiction — A court may dismiss an action ex mero motu or motu proprio when it has no jurisdiction over the subject matter. Lack of jurisdiction cannot be cured by the silence, acquiescence, or even express consent of the parties. The Court applied this doctrine to affirm the RTC's dismissal of the complaint without prejudice.
• Grave abuse of discretion — An act of a court or tribunal may only be considered grave abuse of discretion when performed in a capricious or whimsical exercise of judgment equivalent to lack of jurisdiction. The abuse must be so patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform a duty enjoined by law, or to act at all in contemplation of law, as where the power is exercised in an arbitrary and despotic manner by reason of passion or personal hostility. The Court found no such circumstances in the RTC's dismissal.

• "It is important to note that Section 1, Rule 63 of the Rules of Court does not categorically require that an action to quiet title be filed before the RTC. It repeatedly uses the word 'may' – that an action for quieting of title 'may be brought under [the] Rule' on petitions for declaratory relief, and a person desiring to file a petition for declaratory relief 'may x x x bring an action in the appropriate Regional Trial Court.' The use of the word 'may' in a statute denotes that the provision is merely permissive and indicates a mere possibility, an opportunity or an option." — This passage establishes the interpretive principle that the permissive language of Rule 63 does not confer jurisdiction, which must instead be found in the mandatory provisions of the Judiciary Reorganization Act.
• "In the present case, petitioners' Complaint for quieting of title was filed after petitioners already demanded and respondents refused to vacate the subject property. In fact, said Complaint was filed only subsequent to the latter's express claim of ownership over the subject property before the Lupong Tagapamayapa, in direct challenge to petitioners' title. Since petitioners averred in the Complaint that they had already been deprived of the possession of their property, the proper remedy for them is the filing of an accion publiciana or an accion reivindicatoria, not a case for declaratory relief." — This passage articulates the ratio decidendi: declaratory relief is unavailable once a breach has occurred, and the proper remedy for a landowner deprived of possession is accion publiciana or accion reivindicatoria.
• "It is axiomatic that the nature of an action and the jurisdiction of a tribunal are determined by the material allegations of the complaint and the law at the time the action was commenced. Jurisdiction of the tribunal over the subject matter or nature of an action is conferred only by law and not by the consent or waiver upon a court which, otherwise, would have no jurisdiction over the subject matter or nature of an action. Lack of jurisdiction of the court over an action or the subject matter of an action cannot be cured by the silence, acquiescence, or even by express consent of the parties. If the court has no jurisdiction over the nature of an action, it may dismiss the same ex mero motu or motu proprio." — This passage, quoted from Laresma vs. Abellana, states the controlling doctrine on jurisdiction and motu proprio dismissal, and was applied to affirm the RTC's dismissal.

• Laresma vs. Abellana, 484 Phil. 766 (2004) — Controlling precedent quoted for the doctrine that jurisdiction is determined by the material allegations of the complaint and the law at the time of commencement, that jurisdiction is conferred only by law, and that a court may dismiss an action motu proprio for lack of jurisdiction.
• Velarde vs. Social Justice Society, G.R. No. 159357, April 28, 2004, 428 SCRA 283 — Cited for the proposition that a petition for declaratory relief may be entertained only before the breach or violation of the instrument or rights involved.
• Rumarate vs. Hernandez, G.R. No. 168222, April 18, 2006, 487 SCRA 317 — Cited by petitioners for the proposition that causes of action may be joined in a single complaint; the Court did not rely on this case in its ruling.
• De Ocampo vs. Secretary of Justice, G.R. No. 147932, January 25, 2006, 480 SCRA 71 — Cited for the interpretive rule that the word "may" in a statute denotes a permissive provision.
• Tambunting, Jr. vs. Sumabat, G.R. No. 144101, September 16, 2005, 470 SCRA 92 — Cited for the rule that a court has no jurisdiction over an action for declaratory relief if its subject has already been infringed or transgressed before the institution of the action.
• Hilario vs. Salvador, G.R. No. 160384, April 29, 2005, 457 SCRA 815 — Cited for the definitions of accion publiciana and accion reivindicatoria.
• Yee vs. Bernabe, G.R. No. 141393, April 19, 2006, 487 SCRA 385 — Cited for the definition of grave abuse of discretion.

• Section 1, Rule 63, Rules of Court — Provides that any person interested under a deed, will, contract, or other written instrument may bring an action in the RTC for declaratory relief before breach or violation thereof, and that actions for reformation of an instrument, to quiet title, or to consolidate ownership may be brought under the Rule. The Court interpreted this provision as permissive ("may") and held that it does not override the mandatory jurisdictional allocation of the Judiciary Reorganization Act.
• Section 19(2), Batas Pambansa Blg. 129, as amended by Republic Act No. 7691 — Vests the RTC with exclusive original jurisdiction over civil actions involving title to or possession of real property where the assessed value exceeds ₱20,000.00 (or ₱50,000.00 in Metro Manila). The Court applied this to find that the RTC lacked jurisdiction over the subject property valued at ₱410.00.
• Section 33(3), Batas Pambansa Blg. 129, as amended by Republic Act No. 7691 — Vests the MTC with exclusive original jurisdiction over civil actions involving title to or possession of real property where the assessed value does not exceed ₱20,000.00 (or ₱50,000.00 in Metro Manila). The Court applied this to determine that the MTC had jurisdiction over petitioners' action.
• Articles 476 to 481, Civil Code — Authorize actions to quiet title. The Court identified these provisions as the substantive basis for the remedy of quieting of title.
• Articles 1359 to 1369, Civil Code — Recognize actions for reformation of an instrument. The Court identified these as one of the remedies under the second paragraph of Rule 63, Section 1.
• Article 1607, Civil Code — Governs consolidation of ownership in a sale with right to repurchase. The Court identified this as one of the remedies under the second paragraph of Rule 63, Section 1.
• Article 19, Civil Code — Requires every person to act with justice, give everyone his due, and observe honesty and good faith. Petitioners invoked this provision in their claim for actual damages against respondents.
• Article 21, Civil Code — Provides that any person who wilfully causes loss or injury to another in a manner contrary to morals, good customs, or public policy shall compensate the latter for damage. The Court noted this provision is read in relation to Article 19 in claims for damages.

• Consuelo Ynares-Santiago, Associate Justice (Chairperson, Third Division)
• Presbitero J. Velasco, Jr., Associate Justice
• Antonio Eduardo B. Nachura, Associate Justice
• Diosdado M. Peralta, Associate Justice

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