ChanRobles Virtual law Library

[ G.R. No. 139005. July 28, 1999]

MANILA CREDIT CORP. vs. MILA JALANDONI, et al.

SECOND DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this court dated JUL 28, 1999.

G.R. No. 139005 (Manila Credit Corporation vs. Mila Jalandoli, et al.)

On May 29, 1997, respondents Antonio and Mila Jalandoli filed a complaint against Eliseo R. Bautista, Emperatriz C. Bautista, the Registrar of Deeds of Makati City, spouses Eduardo S. Tongco and Ma. Teresa A. Tongco, and petitioner Manila Credit Corporation (hereafter called MCC) "for cancellation of titles and damages." The case was filed in the Regional Trial Court of Makati City, Branch 57. Respondents alleged that sometime in May, 1997, when they applied for a loan using as collateral two lots in Muntinlupa registered in their names under TCT Nos. 201048 and 201049, they discovered that their titles had been cancelled by virtues of two deeds of absolute sale purportedly executed by them in favor of Eliseo and Emperatriz Bautista; that the Bautistas, who under the said deeds of absolute sale paid only P600,000.00 for each lot, later mortgaged one lot to Eduardo S. Tongco and Ma. Teresa Tongco for P1.7 million and the other lot to herein petitioner for P3,493,379.82. Respondents prayed that the deeds of absolute sale be declared a "nullity" for having been forged and falsified; that TCT Nos. 205624 and 206091 in the names of Eliseo R. Bautista and Emperatriz C. Bautista be cancelled; that the encumbrances on the Bautista' titles be cancelled; that their (respondents') titles, TCT Nos. 201048 and 201049, be reinstated free from any and all encumbrances; and that the spouses Bautista be ordered to pay them P25,000.00 actual damages, P1,000,000.00 moral damages, P100,000.00 exemplary damages, P200,000.00 attorney's fees, and costs.

Petitioner MCC moved for the dismissal of the case on the ground of improper venue, alleging that the properties subject of the case are situated in Muntinlupa and failure to state a cause of action against it, alleging that petitioner MCC is a mortgagee in good faith.

In its order dated March 24, 1998, however, the RTC denied petitioner's motion to dismiss and later denied petitioner's motion for reconsideration.

On certiorari, the Court of Appeals upheld the RTC's orders. Its motion for reconsideration having been denied, petitioner filed the present petition for review.

Petitioner contends respondents' action is not a personal, but a real action and therefore must be brought in the RTC of Pasig as provided in Rule 4, �1. It further contends that the complaint states no cause of action against them.

The contentions lack of merit. In De Leon v. Court of Appeals, 287 SCRA 94 (1998), where there was a similar complaint filed for, among others, declaration of nullity or of a deed of absolute sale of two parcels of land for "being absolutely simulated," the Court held that the same was not real action but a personal action, the subject matter of which is not capable of pecuniary estimation.

In this case although eventually the result may be the recovery of the parcels of land, it is the nature of the action, which is for declaration of nullity of the deeds of sale, which is controlling. Both the Court of Appeals and the Regional Trial Court correctly held that venue was properly laid at Makati City where respondents reside in accordance with Rule 4 �2 of the 1997 Rules of Civil Procedure.

Anent petitioner's contention that respondent spouses' complaint does not allege that it (petitioner) is a mortgagee in bad faith, the Court of Appeals correctly held that as petitioner is the mortgagee of one of the parcels of land respondent spouses claimed was acquired by the Bautistas through a simulated deed of sale, petitioner is a necessary party and its inclusion in the complaint is required for a complete determination of the claims of respondent spouses Antonio and Mila Jalandoni.

For the foregoing considerations, the Court RESOLVES to DENY the petition for lack of showing that the Court of Appeals committed reversible error.

Very truly yours,

(Sgd.) TOMASITA M. DRIS

Clerk of Court

Back to Home | Back to Main

CLICK HERE FOR THE LATEST SUPREME COURT JURISPRUDENCE