Case Summary (G.R. No. 49475)
Relevant Dates and Procedural Posture
April 4, 1977: Petitioner subdivided the leased premises and took possession of half the space.
July 18, 1977: Private respondent filed Civil Case No. 2901 in the Court of First Instance (CFI) of Zamboanga del Norte, Dipolog City, seeking damages and the fixing of the lease period at five years.
Petitioner moved to dismiss for improper venue, asserting the action was a real action and should have been filed in Ozamiz City (CFI of Misamis Occidental). The trial judge denied the Motion to Dismiss on November 6, 1978, and denied reconsideration on December 4, 1978. Petitioner then filed the present petition for prohibition.
Core Legal Question
Whether the action filed by Elumba Industries (for damages and to fix the lease period at five years) is a personal action or a real action for purposes of venue; consequently, whether Dipolog City was a proper venue or whether the action should have been brought in the court having jurisdiction over Ozamiz City where the property lies.
Applicable Law and Authorities
Primary procedural law: Rule 4, Revised Rules of Court — Sec. 1 (venues for personal actions) and Sec. 2(a) (definition of real actions affecting title or recovery of possession of real property). Relevant jurisprudence cited in the decision: Hernandez v. Rural Bank of Lucena, Inc.; Fortune Motors (Phils.), Inc. v. Court of Appeals; Carandang v. Court of Appeals; Tenorio v. Pano; Punsalan, Jr. v. Vda. de Lacsamana; and Ching v. Court of Appeals. (The decision applies the procedural venue rules under the applicable constitutional and statutory framework in effect at the time.)
Distinction Between Action Types
The Court emphasized the critical distinction for venue purposes between a personal action and a real action (as opposed to the separate concepts of action in personam versus action in rem). A personal action typically seeks enforcement of a contract, recovery of personal property, or damages and may be instituted in the forum where a party resides or may be found. A real action involves title to real property or recovery of possession (Sec. 2(a), Rule 4), and must be filed in the court having jurisdiction over the territory where the property, or part thereof, lies. The designation “in personam” or “in rem” pertains to the scope of a judgment’s binding effect and is distinct from the venue-oriented classification of personal versus real actions.
Court’s Factual and Legal Analysis
Although the complaint sought damages (a classic personal relief), it also sought the fixing of the lease period at five years. The Court examined the practical and legal consequences of granting that relief: if the lease period were fixed in favor of private respondent, private respondent would be entitled to remain as lessee for the fixed period and to recover the half of the premises that petitioner had repossessed. Because the original lease covered the entire commercial space, awarding the requested relief would necessarily involve recovery of possession of a portion of real property. The Court further observed that even if the complaint did not expressly pray for recovery of possession, such recovery was the necessary legal consequence of fixing the lease term and adjudicating the lessee’s right to occupy the premises. Therefore, the ultimate object and prime objective of the action were to recover possession of real property (or a significant portion thereof), making the action a real action for venue purposes.
Holding
The Supreme Court held that the trial judge gravely abused his discretion in denying the Motion to Dismiss for improper venue. Because the action’s ultimate purpose involved the recovery of possession of a portion of real property, it was a real action and therefore must have been commenced in the court having jurisdiction
...continue readingCase Syllabus (G.R. No. 49475)
Title, Citation and Forum
- Decision reported at 297 Phil. 863, First Division, G.R. No. 49475, dated September 28, 1993.
- Petitioner: Jorge C. Paderanga.
- Respondents: Hon. Dimalanes B. Buissan, Presiding Judge, Court of First Instance of Zamboanga del Norte, Branch III (Dipolog City), and Elumba Industries Company, represented by General Manager Jose J. Elumba.
- Nature of recourse: Petition for Prohibition directed to the trial court judge for alleged lack or excess of jurisdiction in denying a Motion to Dismiss for improper venue.
Facts
- In 1973 petitioner Jorge C. Paderanga and private respondent Elumba Industries Company entered into an oral lease of a commercial space in a building owned by petitioner in Ozamiz City.
- The lease was for an indefinite period with monthly rent of P150.00 paid on a month-to-month basis.
- Elumba Industries Company used the leased premises as the Sales Office of Allied Air Freight in Ozamiz City.
- On April 4, 1977, petitioner subdivided the leased premises by constructing a partition wall and took possession of one-half of the space; petitioner asserts this repossession occurred with the acquiescence of Elumba’s local manager, while private respondent denies such acquiescence.
- The validity of the repossession itself was not directly at issue before the Supreme Court in this petition.
- On July 18, 1977, private respondent filed Civil Case No. 2901 in the then Court of First Instance of Zamboanga del Norte based in Dipolog City, praying for damages and seeking to fix the period of the lease at five (5) years.
- The damages sought by private respondent were itemized as: (a) P100,000.00 as moral damages; (b) P50,000.00 as exemplary damages; (c) P5,000.00 as attorney’s fees; and (d) P1,000.00 as costs of suit.
Procedural History in Trial Court
- The complaint was raffled to Branch III of the Court of First Instance in Dipolog City.
- Petitioner, a resident of Ozamiz City, moved to dismiss the complaint for improper venue, arguing that the action was a real action concerning property (recovery of possession) and therefore should have been filed in the Court of First Instance of Misamis Occidental stationed in Ozamiz City where the property lies.
- On November 6, 1978, Judge Dimalanes B. Buissan denied the Motion to Dismiss, ruling that Civil Case No. 2901 involved enforcement of a lease contract and, although it affected a portion of real property, it did not raise a question of ownership; hence venue was proper in Dipolog.
- Petitioner filed a Motion for Reconsideration, contending the action sought recovery of possession and thus was a real action requiring venue in Ozamiz City.
- On December 4, 1978, the trial judge denied reconsideration, noting that while the complaint prayed for recovery of possession, that matter was not the main issue and ownership was not raised.
- Petitioner escalated the matter to the Supreme Court by filing the present petition for prohibition.
Issues Presented
- Whether the action filed by Elumba Industries Company in Dipolog City (Civil Case No. 2901) was a proper action in personam (personal action) allowing venue where plaintiff or defendant resides, or whether it was a real action requiring venue in the court having jurisdiction over the territory where the real property (or part thereof) lies.
- Whether the trial judge abused his discretion amounting to lack or excess of jurisdiction in denying the Motion to Dismiss for improper venue.
Parties’ Contentions
- Petitioner’s contentions:
- The action sought to recover possession of the portion of the premises repossessed by the lessor; it also sought to fix the lease period at five years.
- As an action that essentially seeks recovery of possession of real property, it is a real action and must be filed in the court having territorial jurisdiction over the property (Ozamiz City, Misamis Occidental).
- The suit filed in Dipolog City was therefore improper as to venue and should have been dismissed.
- Private respondent’s contentions:
- The main relief sought was damages for alleged breach of the lease contract; the recovery of possession was only incidental.
- The action is chiefly one for enforcement of a contract and for damages—i.e., a personal in nature action in personam—so venue could be laid in Dipolog City where the plaintiff elected to sue, under the rule that personal actions may be instituted where plaintiff or defendant resides.
Legal Distinctions and Principles Applied by the Court
- The Court empha