PICOP vs. Samson

An action primarily seeking the recovery of possession of a real property concession is a real action that must be filed in the province where the property is situated, and any objection to venue is deemed waived when the parties proceed to trial without securing a ruling on their motion to dismiss.

Paper Industries Corporation of the Philippines (PICOP) is the licensee of a pulpwood and timber concession with portions located in the provinces of Surigao del Sur and Agusan. Jose Samson and Benjamin Barrera were discovered unlawfully logging within PICOP's concession area in Surigao del Sur. They claimed to be mere employees of another concessionaire, Lope A. Coñate, who owned and operated the logging in the questioned area.

On July 16, 1965, petitioner Paper Industries Corporation of the Philippines (PICOP) filed a verified complaint for injunction and damages against respondents Jose Samson and Benjamin Barrera before the Court of First Instance of Surigao del Sur. PICOP alleged that it is the licensee of a pulpwood and timber concession with portions located in Surigao del Sur and Agusan, and that Samson and Barrera had unlawfully entered, trespassed, and encroached into its concession areas in Pamintigan, Mabtay, Malix, Surigao del Sur. Without any title or notice, the respondents felled trees and took them away, logging over 857 hectares and extracting 958.60 cubic meters of logs, causing damages amounting to ₱10,600.00 as of May 31, 1965. Despite demands to vacate, the respondents continued their illegal logging operations.

Samson and Barrera filed a joint answer and a motion to dismiss on the ground of improper venue, contending that the action was personal and should have been filed in Agusan or Rizal, the places of residence of the parties. They also claimed they were mere employees of Lope A. Coñate, the actual concessionaire operating in the area. Without first requiring a ruling on the motion to dismiss, the parties proceeded to trial on the issue of injunction on August 13, 1965, January 1, 1966, and February 5, 1966, where both parties adduced evidence. On May 6, 1966, Judge Ricardo D. Garcia granted PICOP's application for a writ of preliminary injunction.

Subsequently, on September 18, 1968, a new presiding judge, Reynaldo Honrado, granted the defendants' motion to dismiss based on improper venue. After the denial of a motion for reconsideration, PICOP filed a petition for certiorari claiming grave abuse of discretion in the dismissal of the case.

• Nature of the Action: Petitioner argued that the action was principally for injunction and recovery of possession, making the proper venue the place where the concession areas are situated.
• Waiver of Venue: Petitioner contended that respondents waived the objection to improper venue by failing to ask for a ruling on their motion to dismiss and proceeding to trial on the merits of the injunction.

• Improper Venue: Respondents argued that the action was personal and should have been filed in the province of Agusan or Rizal, the places of residence of the parties.
• Real Party in Interest: Respondents maintained that they were not the real parties in interest, claiming they were mere employees of Lope A. Coñate, who owned and operated the logging in the questioned area.

• Nature of the Action: Whether the action is personal or real for purposes of venue.
• Proper Venue: Whether the Court of First Instance of Surigao del Sur was the proper venue for the action.
• Waiver of Venue: Whether the objection to venue was waived by the respondents.

• Nature of the Action: Real action. The complaint primarily sought the recovery of possession of the concession area, not founded on privity of contract.
• Proper Venue: Yes. As a real action, it must be brought in the province where the property lies, which is Surigao del Sur.
• Waiver of Venue: Yes. Respondents went to trial, cross-examined witnesses, and adduced evidence without first requiring a ruling on their motion to dismiss.

• Nature of the Action: The action is not personal because it is not founded on privity of contract. A reading of the complaint shows that PICOP is primarily interested in recovering its rights to the concession, having the respondents vacate the premises, and stopping their illegal logging operations. The claim for damages is only an incident to the principal claim of recovery of possession. Therefore, the action is real.
• Proper Venue: Under Section 2, Rule 4 of the Rules of Court, real actions affecting title to or for recovery of possession of real property must be commenced in the province where the property lies. Additionally, the authority of a court to issue a writ of injunction is coterminous with its territorial jurisdiction; courts of Rizal or Agusan could not issue an injunction to restrain acts being perpetrated in Surigao del Sur.
• Waiver of Venue: Respondents went to trial, cross-examined PICOP's witnesses, and adduced evidence without first requiring a ruling on their motion to dismiss. This constitutes a waiver of the objection to venue, as the active participation in the trial without insisting on the motion to dismiss implies submission to the court's jurisdiction.

• Nature of Actions for Venue — A personal action is founded on privity of contract, while a real action is founded on privity of estate or seeks recovery of possession of real property. Venue is determined by the nature of the principal claim; if the plaintiff is primarily interested in recovering possession of property, the action is real and must be brought where the land is situated.
• Territorial Jurisdiction of Injunction Writs — The jurisdiction of courts to control or restrain acts by means of a writ of injunction is limited to acts being committed or about to be committed within the territorial boundaries of their respective provinces and districts.
• Waiver of Objection to Venue — An objection to improper venue is deemed waived when a party proceeds to trial, introduces evidence, and cross-examines witnesses without first requiring a ruling on their pending motion to dismiss based on venue.

• "A personal action is one that is founded on privity of contract ... But if there is no privity of contract and the action is founded on privity of estate only, such a covenant that runs with the land in the hands of the remote grantees, then the action is local and must be brought in the country wherein the land lies." — This passage defines the distinction between personal and real actions for determining proper venue.
• "The jurisdiction of Courts of First Instance to control or restrain acts by means of a writ of injunction is limited to act being committed or about to be committed within the territorial boundaries of their respective provinces and districts." — This establishes the rule that injunction writs cannot reach acts outside a court's territorial jurisdiction.
• "Suffice it to say that respondents herein went to trial, cross-examined PICOP's witnesses and adduced evidence without first requiring a ruling on their motion to dismiss. This is waiver of venue, pure and simple." — This articulates the principle that participating in trial without insisting on a pending motion to dismiss constitutes waiver of venue objections.

• Cayetano de la Cruz vs. El Seminario de la Archdioceses de Manila et al. — Cited to support the distinction between personal actions (founded on privity of contract) and real actions (founded on privity of estate), determining whether an action is transitory or local.
• Land Tenure Administration, et al. vs. Hon. Macadaeg, et al. — Cited to support the rule that venue is determined by the nature of the principal claim, specifically that an action to recover possession is a real action.
• Hacbang, et al. vs. The Leyte Autobus Co., et al. — Cited to establish that the jurisdiction of courts to issue injunction writs is limited to acts within their territorial boundaries.
• Cudiamat, et al. vs. Torres — Reiterated the rule that a CFI may not issue a writ of preliminary injunction enforceable outside its territorial boundaries.
• Pangasinan Transportation Co. vs. Yatco, et al. — Cited to support the finding of waiver of venue when a party participates in trial and introduces evidence without securing a ruling on a motion to dismiss.

• Section 2, Rule 4, Rules of Court — Governs venue for real actions, requiring that actions affecting title to or for recovery of possession of real property be commenced and tried in the province where the property lies. Applied to classify PICOP's complaint as a real action properly filed in Surigao del Sur.
• Section 2, Rule 58, Rules of Court — Relates to the territorial limitation of injunction writs, supporting the conclusion that only the court in Surigao del Sur could effectively enjoin the acts occurring there.
• Section 44(h), Judiciary Act — Grants CFIs the power to issue writs of injunction in their respective provinces and districts, reinforcing the territorial limit on injunction authority.

Makasiar, Muñoz Palma, and Martin, JJ., concurred. Castro (Chairman) and Teehankee, JJ., concurred in the result.