G.R. No. 234499 June 6, 2018
Rudy L. Racpan, Petitioner, vs. Sharon Barroga-Haigh, Respondent.

FACTS

Petitioner Rudy Racpan filed a Complaint for “Declaration of Nullity of Deed of Sale with Right to Repurchase” before the Regional Trial Court (RTC) of Davao City. He alleged that after his wife’s death, a Deed of Sale dated March 29, 2011, purportedly conveying a property in Carmen, Davao del Norte to respondent Sharon Barroga-Haigh, was discovered. Racpan maintained the deed was falsified, as he never signed it, and the property remained in his possession. He prayed for the deed’s nullity and sought a writ of preliminary injunction.
In her Answer, respondent raised affirmative defenses of improper venue and failure to comply with the condition precedent of barangay conciliation. The RTC dismissed the complaint on these grounds, a dismissal affirmed by the Court of Appeals (CA). The CA ruled the action was a real action affecting an interest in real property, thus venue was improperly laid in Davao City instead of Davao del Norte where the land is situated. It also held the prayer for injunction was a ploy to evade barangay conciliation.

ISSUE

Whether the Court of Appeals erred in affirming the dismissal of the complaint for improper venue and non-compliance with barangay conciliation.

RULING

The Supreme Court granted the petition and reversed the CA. The complaint is a personal action, not a real action. The nature of an action is determined by the allegations in the complaint and the primary relief sought. A real action affects title to, possession of, or an interest in real property. Here, the core of Racpan’s complaint was the declaration of nullity of the Deed of Sale based on alleged forgery. The objective was to nullify a contract, not to recover title or possession of the land itself. The property’s location was merely incidental to the contract being assailed. Consequently, under Rule 4, Section 2 of the Rules of Court, venue for this personal action was properly laid in Davao City, where either plaintiff or defendant resides.
Regarding barangay conciliation, the Local Government Code provides exceptions, including where the action is coupled with a provisional remedy like a preliminary injunction. Racpan’s complaint expressly included a prayer for a writ of preliminary injunction. The CA’s assumption that this was a mere ploy to avoid conciliation, absent proof of bad faith, was erroneous. The filing was thus exempt from the barangay conciliation requirement. The dismissal orders were set aside and the case was ordered reinstated for trial.