Title
Antonino vs. Register of Deeds of Makati City
Case
G.R. No. 185663
Decision Date
Jun 20, 2012
A lessee sought to enforce a right of first refusal and sale agreement, but her complaint was dismissed for improper venue and non-payment of fees. Her petition for annulment of judgment was denied, as it cannot substitute a lost appeal.
lease contract
right of first refusal
capital gains tax

Case Summary (G.R. No. 185663)

Factual Background

Remedios Antonino had leased a residential property in Makati City owned by Tan Tian Su since March 21, 1978, and the lease granted Antonino a right of first refusal in the event of sale. On July 7, 2004, the parties executed an instrument denominated an Undertaking Agreement under which Su agreed to sell the property to Antonino for P39,500,000.00, with a purported downpayment of $50,000.00 to be given the following day. The proposed sale did not proceed because the parties disagreed over who should pay the capital gains tax. On July 9, 2004, Antonino filed an action in the RTC for reimbursement of repairs and for damages, and later that same day she filed an amended complaint seeking enforcement of the Undertaking Agreement and specific performance compelling Su to sell the property in accordance with the agreement.

Trial Court Proceedings

The RTC dismissed Antonino’s amended complaint in its Order dated December 8, 2004, on the dual grounds of improper venue and nonpayment of the appropriate docket fees. The court concluded that the action was one for specific performance and damages, a personal action under Section 2, Rule 5 of the Rules of Court, and therefore should have been filed either in the residence of the plaintiff or the defendant; Antonino resided in Muntinlupa while Su resided in Manila, and venue in Makati was improper. The RTC also held that it acquired no jurisdiction because the correct docket fees were not paid, citing the principle that a court acquires jurisdiction only upon payment of prescribed docket fees. Thereafter, on December 23, 2004, Su moved to cancel the notice of lis pendens and sought summary judgment on counterclaims. Antonino filed a motion for reconsideration dated January 3, 2005, and a subsequent motion dated January 21, 2005. The RTC denied relief in its Order of January 6, 2005 and in its Joint Resolution dated February 24, 2005, reiterating that the dismissal was without prejudice to refiling in the proper forum and that the motions for reconsideration were insufficient to suspend the running of the appeal period.

Proceedings in the Court of Appeals

Antonino filed a petition for annulment of judgment with the Court of Appeals on April 1, 2005, seeking nullification of the RTC’s December 8, 2004 Order, the January 6, 2005 denial of reconsideration, and the February 24, 2005 Joint Resolution. She alleged that the RTC committed grave abuse of discretion amounting to lack of jurisdiction and that the dismissal deprived her of the opportunity to pay correct docket fees. In its Decision dated May 26, 2008, the Court of Appeals dismissed the petition. The CA found that Antonino had an available remedy by appeal which she failed to pursue; that the action sought to enforce a contract and therefore was a personal action properly filed in Muntinlupa or Manila under Section 2, Rule 5; and that lack of jurisdiction for purposes of annulment must be absolute and not merely an assertion of grave abuse of discretion.

Issue Presented

The sole issue before the Supreme Court was whether Antonino properly invoked the extraordinary remedy of a petition for annulment of judgment under Rule 47 of the Rules of Court to set aside the RTC’s final and executory orders.

Supreme Court Ruling

The Supreme Court denied the petition and affirmed the Court of Appeals Decision dated May 26, 2008 and Resolution dated December 5, 2008. The Court held that annulment of judgment is an extraordinary, equitable remedy limited to instances of extrinsic fraud or lack of jurisdiction and is not available to remedy errors attributable to a party’s failure to pursue ordinary remedies such as appeal.

Legal Basis and Reasoning

The Court reiterated that the action for annulment of judgment under Rule 47 is permitted only on the grounds of extrinsic fraud or lack of jurisdiction, as explained in Ramos v. Judge Combong, Jr. and Barco v. Court of Appeals, because annulling final judgments undermines the finality of litigation. The petitioner bore the burden to show that ordinary remedies were unavailable through no fault of hers; Antonino failed to demonstrate such justification and offered no explanation for her failure to appeal the RTC’s December 8, 2004 Order or the January 6, 2005 denial of reconsideration. The Court observed that the December 8, 2004 Order was final and appealable under Rule 41, and that the denial of the motion for reconsideration of a final order is itself appealable, citing Quelnan v. VHF Philippines, Inc. The Court found that, even allowing a liberal application of the three-day notice requirement under Section 4, Rule 15, Antonino neglected the fifteen-day period to perfect an appeal and instead filed a petition for annulment on April 1, 2005.

The Court further held that grave abuse of discretion cannot be used to enlarge the concept of lack of jurisdiction. Lack of jurisdiction for annulment purposes concerns absence of jurisdiction over the person or subject matter, not errors in the exercise of jurisdiction, as explained in Republic of the Philippines v. G Holdings, Inc. and Tolentino v. Judge Leviste. The RTC correctly classified Antonino’s cause of action as a personal action for enforcement of a contract, not a real ac

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