SUPREME COURT DECISIONS

PLEASE CLICK HERE FOR THE LATEST ➔ SUPREME COURT DECISIONS

G.R. No. L-12707           December 23, 1959
DEMETRIO BUNAYOG vs. ANACLETA TUNAS, ET AL. -->

EN BANC

G.R. No. L-12707           December 23, 1959

DEMETRIO BUNAYOG, Plaintiff-Appellant, vs. ANACLETA TUNAS, ET AL., Defendants-Appellees.

Emiliano A. Bunayog for appellant.
Fernando B. Fuentes, Jr., for appellees.

BAUTISTA ANGELO, J.:

On September 6, 1956, plaintiff filed an action before the Court of First Instance of Misamis Occidental to foreclose a real estate mortgage and recover an amount not exceeding P1,500.00, representing damages and interests.chanroblesvirtualawlibrary chanrobles virtual law library

On October 19, 1956, defendants filed a motion to dismiss on grounds that the complain states no cause of action; that the deed of mortgage which is sought to be foreclosed is null and void; and that the action involves recovery of money which comes within the exclusive original jurisdiction of he Justice of the peace court.chanroblesvirtualawlibrary chanrobles virtual law library

On November 7, 1956, plaintiff filed an opposition to the motion to dismiss maintaining that the deed of mortgage is valid because the same is authorized by Republic Act No. 133 which permit the execution of a mortgage on private real property in favor of any individual subject to certain conditions. On November 17, 1956, the trial court sustained the motion and dismissed the complaint with costs. On December 12, 1957, plaintiff filed a motion for reconsideration, and when the same was denied, he interposed the present appeal.chanroblesvirtualawlibrary chanrobles virtual law library

It appears that the real property covered by the mortgage sought to be foreclosed is covered by a homestead patent issued to defendants on October 26, 1950, and that before the expiration of the five-year period from the issuance of said patent, or on March 27, 1952, defendant executed the mortgage in question in favor of plaintiff to secure the payment of certain monetary obligation. On the other hand, Section 118 of Commonwealth Act 141, as amended by Commonwealth Act 456, provides that "except in favor of the Government or any of its branches, units, or institutions, lands acquired under free patent or homestead provisions, shall not be subject to encumbrance or alienation from the date of the approval of the application and for a term of five years from and after the date of issuance of the patent or grant, nor shall they become liable to the satisfaction of any debt contracted prior to the expiration of said period", otherwise the transaction shall become null and void (Santos vs. Roman Catholic Church of Midsayap, 94 Phil., 405; 50 Off. Gaz. [4], 1588, Philippine National Bank vs. Espinosa, 66 Phil., 716).chanroblesvirtualawlibrary chanrobles virtual law library

It would, therefore, appear that the deed of mortgage in question, which covers property acquired by a homestead patent, is null and void, it having been executed within the period of five years from the issuance of the patent. We, however, that the trial court erred in dismissing the complaint on the ground of lack of jurisdiction even if the amount sought to be recovered is less than P2,000.00 because the issue regarding the validity of the mortgage does not come within the original exclusive jurisdiction of the justice of the peace court. It being an issue which is not capable of pecuniary estimation, the same can only be determined by the court of first instance (Republic Act No. 296, Section 88, as amended by Republic Act No. 646, Section 22). The trial court should have therefore taken cognizance of the case and should have acted thereon on its merits.chanroblesvirtualawlibrary chanrobles virtual law library

Wherefore, the order appealed from is set aside and the case remanded to the trial court for further proceedings, with costs against the appellees.chanroblesvirtualawlibrary chanrobles virtual law library

Paras, C.J., Bengzon, Padilla, Montemayor, Labrador, Concepcion, Endencia, Barrera and Gutierrez David, JJ., concur.