G.R. No. 151266 November 29, 2005
SPS. RAYMUNDO & MARILYN CALO, Petitioners, vs. SPOUSES REYNALDO & LYDIA TAN and THE DEVELOPMENT BANK OF THE PHILIPPINES, (Butuan Branch), Respondents.

FACTS

Respondent Lydia Tan entered a joint venture with petitioner Raymundo Calo for a mining business, with Tan as financier and Calo as managing partner. In December 1986, Calo obtained a loan from the Development Bank of the Philippines (DBP) by mortgaging mining equipment allegedly purchased with Tan’s funds, which he represented as his own. Upon Calo’s default, DBP foreclosed and purchased the equipment at auction. The Tans filed a complaint for replevin and damages against the Calos and DBP. During trial, Lydia Tan testified that they had given Calo money for the equipment, prompting a motion to amend the complaint to conform to this evidence. Before the amendment was admitted, DBP leased the equipment to a third party.
After the amended complaint was admitted, which added the lessee as a defendant, the Calos and DBP filed a Joint Motion to Dismiss. They argued the action was barred by prescription and that the respondents failed to pay additional docket fees for the amended complaint. The Regional Trial Court (RTC) denied the motion. The Court of Appeals affirmed, leading to this petition.

ISSUE

Whether the Court of Appeals erred in affirming the RTC’s denial of the Motion to Dismiss based on the grounds of prescription and non-payment of docket fees.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals’ decision. On the issue of prescription, the Court ruled that an action for replevin to recover personal property is imprescriptible as long as the possessor has not acquired ownership by prescription. The amended complaint alleged the Calos’ possession was in bad faith from the start, and DBP’s possession was derived from them. Since the action was filed in 1987, well within any potential prescriptive period, and the nature of the possession was a factual matter for trial, dismissal on prescription grounds was improper.
Regarding the docket fees, the Court held that the amended complaint did not constitute a new complaint or introduce a new cause of action; it merely amplified the original cause of action for recovery of personal property based on ownership. The amendment aimed to conform to evidence already presented and to implead a new party who came into possession after the suit began. Consequently, no additional filing fees were required. The trial court correctly exercised its discretion in admitting the amended complaint and proceeding to trial on the merits. The Motion to Dismiss was correctly denied.