GR 169370; (April, 2008) (Digest)
G.R. No. 169370 ; April 14, 2008
EUSTACIO ATWEL, LUCIA PILPIL and MANUEL MELGAZO, petitioners, vs. CONCEPCION PROGRESSIVE ASSOCIATION, INC., respondent.
FACTS
The dispute involves ownership and control of a wet market property. The late Emiliano Melgazo purchased the property in 1968 in the name of the unincorporated Concepcion Progressive Association (CPA). Upon his death, his son, petitioner Manuel Melgazo, along with other petitioners, administered the property and collected rentals. In 1997, a separate group incorporated themselves as respondent Concepcion Progressive Association, Inc. (CPAI), excluding petitioners. CPAI then filed a case for mandatory injunction before the SEC, later transferred to a Special Commercial Court (RTC) under R.A. 8799, alleging petitioners were collecting rentals without authority. Petitioners actively participated in the trial, arguing the property belonged to Emiliano Melgazo, not CPAI. The trial court ruled for CPAI, treating CPA and CPAI as the same entity.
ISSUE
Whether petitioners are estopped from questioning the jurisdiction of the Special Commercial Court over the case.
RULING
No, estoppel does not apply. The Supreme Court reversed the Court of Appeals. Jurisdiction over the subject matter is conferred by law, and lack of it can be raised at any time. The doctrine of estoppel to challenge jurisdiction, as in Tijam v. Sibonghanoy, applies only in exceptional circumstances of laches, where a party actively participates for an unreasonable length of time before raising the issue. Here, petitioners raised the jurisdictional challenge in their appeal to the CA, not after an inordinate delay. The core issue was whether the case was an intra-corporate dispute under the court’s special jurisdiction. Since petitioners were admittedly not members of the incorporated CPAI, the dispute was not intra-corporate. Thus, the Special Commercial Court lacked jurisdiction from the outset. The active participation of petitioners in the trial, without more, did not constitute the kind of laches or waiver that would bar them from assailing jurisdiction. The Court emphasized that the principle of estoppel is applied to jurisdiction with great caution and should not defeat the clear mandate of the law on jurisdictional boundaries.