GR L 18567; (March, 1963) (Digest)
G.R. No. L-18567; March 30, 1963
THE CAPITAL INSURANCE AND SURETY COMPANY, INC., plaintiff-appellee, vs. MARIO DELGADO, ET AL., defendants-appellants.
FACTS
The Capital Insurance and Surety Co., Inc. issued Fire Insurance Policy No. C-1137 to Mario Delgado and Leonor Delgado Dee on August 1, 1953, covering personal properties for one year. The corresponding premium and documentary stamp charges were billed but remained unpaid by the insured. Despite this non-payment, the insurance company issued a renewal certificate for the policy covering the period from August 1, 1954, to August 1, 1955. After sending reminders and receiving a promise to pay which was not fulfilled, the insurer filed a complaint in the Court of First Instance of Cebu to recover the sum of P583.95 for the unpaid premiums, plus attorney’s fees and costs.
The defendants-appellants, in their answer, denied having insured their property with the plaintiff and contended that no contract of insurance was ever consummated due to the non-payment of the premium. They argued that, consequently, the insurance company had no cause of action against them for the recovery of the premium charges.
ISSUE
Whether the Court of First Instance of Cebu had original jurisdiction over the subject matter of the case, which was an action for the recovery of a sum of money amounting to P583.95.
RULING
The Supreme Court set aside the decision of the lower court and dismissed the case. The ruling was based solely on the ground of lack of jurisdiction over the subject matter. The Court held that the action filed by the insurance company was merely for the recovery of a sum of money—the principal amount of P583.95, plus interest and attorney’s fees. At the time the action was instituted, the jurisdictional amount for the Court of First Instance to exercise original jurisdiction was over P10,000, pursuant to Section 44 of Republic Act No. 296 , as amended. Since the total amount claimed, even with interest and attorney’s fees, did not exceed P10,000, the case fell within the exclusive original jurisdiction of the inferior courts.
Consequently, the Court of First Instance of Cebu had no original jurisdiction to try the case. All proceedings undertaken by that court, including its decision ordering the defendants to pay, were declared null and void. The Supreme Court did not reach or rule upon the substantive merits of the case regarding the validity of the insurance contract or the liability for the premium. The dismissal was purely on jurisdictional grounds, without prejudice to the filing of the appropriate action in the proper court.