G.R. No. 199290 , February 3, 2020
MUNICIPALITY OF CAINTA, RIZAL, PETITIONER, V. SPOUSES ERNESTO E. BRAÑA AND EDNA C. BRAÑA AND CITY OF PASIG, RESPONDENTS.

FACTS

Spouses Ernesto E. Braña and Edna C. Braña (Sps. Braña) are the registered owners of six parcels of land located at Phase 9, Pasig Green Park, Cainta, Rizal. They religiously paid real estate taxes on these properties to the Municipality of Cainta from 1994 to 1996. In 1997, the City of Pasig filed a civil case for collection of unpaid taxes against Sps. Braña, claiming the properties were geographically located in Pasig City. Sps. Braña deposited checks for the taxes (1995-1998) with the Metropolitan Trial Court where that case was pending. However, the Municipality of Cainta continued to demand payment from Sps. Braña. To avoid another possible tax collection case, Sps. Braña filed an action for interpleader to compel the Municipality of Cainta and the City of Pasig to litigate their claims. Meanwhile, a separate boundary dispute case between the Municipality of Cainta and the City of Pasig, involving the subject properties, was pending before the Regional Trial Court (RTC) of Antipolo City. The RTC of Antipolo had issued an Injunction Order restraining the City of Pasig from further collecting taxes from the disputed areas. The locational entries in the Transfer Certificates of Title (TCTs) for the subject properties indicate “Barrio of Santolan, Municipality of Pasig, Metro Manila.” The RTC of Pasig, in the interpleader case, ordered Sps. Braña to pay real estate taxes from 1996 onward to the City of Pasig, ruling that the locational entries in the TCTs were controlling unless corrected by competent authority. The Municipality of Cainta directly filed a Petition for Review on Certiorari before the Supreme Court, arguing that the RTC of Pasig interfered with the jurisdiction of the RTC of Antipolo and that its decision contravened the Injunction Order.

ISSUE

Whether the real estate taxes due upon the subject properties owned by Sps. Braña should be paid to the City of Pasig, as ruled by the RTC of Pasig in the interpleader case.

RULING

The Supreme Court PARTIALLY GRANTED the petition. It REVERSED and SET ASIDE the Decision of the RTC of Pasig. The Court held that the resolution of the boundary dispute case pending before the RTC of Antipolo is determinative of which local government unit has territorial jurisdiction and, consequently, the right to collect taxes. Pending final resolution of that boundary dispute, the status quo prior to the dispute must be maintained as required by the Implementing Rules of the Local Government Code. The Court found that the RTC of Pasig’s order for Sps. Braña to pay taxes to the City of Pasig based solely on the TCT entries was premature and interfered with the pending boundary case. The Supreme Court ordered Sps. Braña to deposit succeeding real estate tax payments in an escrow account with the Land Bank of the Philippines in trust for the City of Pasig/the Municipality of Cainta. The proceeds are to be released upon the final judgment in the boundary dispute case. The RTC of Antipolo was also ordered to resolve the boundary dispute case with dispatch.