GR 166751; (June, 2006) (Digest)
G.R. No. 166751 ; June 8, 2006
RIDGEWOOD ESTATE, INC. (Erroneously sued as Camella Homes), Petitioner, vs. EXPEDITO BELAOS, Respondent.
FACTS
Petitioner Ridgewood Estate, Inc., a subdivision developer operating under the trade name “Camella Homes,” entered into a Contract to Sell with respondent Expedito Belaos for a house and lot. Respondent issued postdated checks as amortization. Petitioner failed to construct the house, prompting respondent to rescind the contract via a letter dated April 16, 2000, demanding a refund of payments and the return of the checks. Petitioner refunded a portion of the amount but continued to encash the remaining checks.
Respondent filed a Complaint for damages before the Regional Trial Court (RTC) of Manila against “Camella Homes.” Petitioner moved to dismiss, arguing that “Camella Homes” is not a juridical entity capable of being sued, that Ridgewood is the real party-in-interest, and that the complaint stated no cause of action. The RTC denied the motion, applying the doctrine of corporation by estoppel. Petitioner elevated the case via certiorari to the Court of Appeals (CA), adding the argument that jurisdiction belonged to the Housing and Land Use Regulatory Board (HLURB). The CA dismissed the petition, prompting this appeal.
ISSUE
Whether the RTC correctly: (1) assumed jurisdiction over the complaint for damages; and (2) denied the motion to dismiss despite the respondent having sued under the trade name “Camella Homes.”
RULING
The Supreme Court affirmed the CA’s decision. On jurisdiction, the Court held that the HLURB’s exclusive jurisdiction under P.D. No. 1344 extends to claims rooted in the contractual relationship of subdivision development, such as refunds or specific performance of statutory and contractual obligations. Here, the contract had already been rescinded, and the cause of action was not for enforcement of subdivision obligations but for damages arising from the allegedly tortious act of encashing checks with knowledge of the rescission. This civil action for damages falls within the general jurisdiction of regular courts.
On the matter of the party sued, the Court found no grave abuse of discretion in the RTC’s denial of the motion to dismiss. While “Camella Homes” is a trade name and not a separate juridical entity, the complaint essentially sought relief against the developer, Ridgewood Estate, Inc. The proper remedy was not dismissal but the amendment of the complaint to substitute or join the correct party under Section 11, Rule 3 of the Rules of Court. The RTC’s order for an answer was thus correct to allow the case to proceed and for the real party to be properly impleaded.