G.R. No. 180321 ; March 20, 2013
Editha Padlan, Petitioner, vs. Elenita Dinglasan and Felicisimo Dinglasan, Respondents.

FACTS

Respondent Elenita Dinglasan was the registered owner of a parcel of land. Her mother, Lilia Baluyot, entrusted the owner’s copy of the title to Maura Passion, who subsequently subdivided the property and forged a deed of sale to transfer lots to various buyers. Maura sold Lot No. 625-K to Lorna Ong, who obtained a new title. Lorna then sold the same lot to petitioner Editha Padlan for ₱4,000.00, and a title was issued in Padlan’s name. Upon discovering the fraud, respondents demanded Padlan to surrender the lot and, upon her refusal, filed an action for Cancellation of Title before the Regional Trial Court (RTC) of Balanga, Bataan. Padlan, through counsel, moved to dismiss the case, arguing lack of jurisdiction over her person due to invalid substituted service of summons, as she was allegedly residing in Japan. The RTC denied her motion, declared her in default, and after trial, initially ruled she was a buyer in good faith and dismissed the complaint. The Court of Appeals reversed the RTC, cancelling Padlan’s title and reviving the respondents’, finding she purchased in bad faith given the suspiciously low price.

ISSUE

The primary issue is whether the RTC had jurisdiction over the subject matter of the case for cancellation of title.

RULING

The Supreme Court granted the petition, reversing the CA and declaring all RTC proceedings null and void for lack of jurisdiction over the subject matter. The Court held that jurisdiction over the subject matter is determined by the allegations in the complaint and the law at the time of its filing. The respondents’ complaint sought the cancellation of a title over a parcel of land purchased for only ₱4,000.00. Under the law governing jurisdiction at the time (B.P. Blg. 129, as amended by R.A. No. 7691 ), actions involving title to or possession of real property where the assessed value does not exceed ₱20,000.00 (or, in Metro Manila, ₱50,000.00) fall within the exclusive original jurisdiction of the Metropolitan Trial Court, Municipal Trial Court, or Municipal Circuit Trial Court. The complaint’s allegation of a purchase price of ₱4,000.00, absent any stated assessed value exceeding the jurisdictional threshold, placed the case within the jurisdiction of the Municipal Trial Court, not the RTC. The Court rejected the application of the doctrine of estoppel by laches from Tijam v. Sibonghanoy, as the issue of subject matter jurisdiction may be raised at any time and cannot be conferred by consent or waiver. Since the RTC lacked jurisdiction from the outset, its decision and all subsequent proceedings were void. The complaint was dismissed without prejudice.