Case Summary (G.R. No. 214803)
Petitioner
Alona G. Roldan seeks judicial foreclosure of a real estate mortgage covering Lot 5891-A-4, Baybay, Makato, Aklan, for P250,000.00 loaned on October 13, 2008, with 5% monthly interest.
Respondents
– Spouses Barrios: Obligors under the mortgage, alleged to have defaulted since February 2011 and to have subsequently re-mortgaged the same property to Matorres.
– Romel D. Matorres: Admitted mortgagee in bad faith; filed separate foreclosure against the Barrios.
Key Dates
– October 13, 2008: Loan and mortgage executed.
– February 3, 2014: Roldan filed foreclosure case (Civil Case No. 9811).
– July 22, 2014: RTC dismissed foreclosure cases for lack of jurisdiction.
– August 18, 2014: RTC denied reconsideration.
– April 23, 2018: Supreme Court decision.
Applicable Law
1987 Philippine Constitution; Batas Pambansa Blg. 129 (as amended by RA 7691) on court jurisdiction in civil actions.
Factual Background
Petitioner alleges that the Barrios borrowed P250,000.00, secured by a real estate mortgage over a 478 m² parcel with assessed value P13,380.00. Default occurred in February 2011. Petitioner discovered a subsequent mortgage in favor of Matorres for P150,000.00 dated June 11, 2012.
Proceedings Below
– Spouses Barrios answered, disputing computation of liabilities and invoking a pending rehabilitation petition (Special Proceeding No. 9845).
– Matorres answered, denying any transaction with petitioner and asserting his own pending foreclosure (Civil Case No. 9642).
RTC Orders
RTC Branch 6, Kalibo dismissed both foreclosure cases (Nos. 9642 and 9811) for “lack of jurisdiction,” reasoning that foreclosure is a real action governed by the assessed value rule. Assessed value P13,380.00 placed jurisdiction in first level courts. Motions for reconsideration by petitioner and Matorres were denied.
Issues on Jurisdiction
Whether the RTC gravely abused its discretion by dismissing petitioner’s foreclosure case on the ground that the assessed value of the mortgaged property (P13,380.00) conferred jurisdiction on first level courts rather than the RTC.
Legal Framework on Jurisdiction
– RTC exclusive original jurisdiction:
- Civil actions incapable of pecuniary estimation;
- Actions involving title to or interest in real property where assessed value exceeds P20,000.00.
– First level courts jurisdiction: Actions involving title or interest in real property with assessed value not exceeding P20,000.00.
– Foreclosure of mortgage is a real action; jurisdiction depends on assessed value.
Court’s Analysis on Foreclosure Jurisdiction
- A real estate mortgage foreclosure seeks the sale of a specifically identified property to satisfy a money obligation.
- Although the ultimate relief involves recovery of money, foreclosure is classified as a real action focused on property.
- Under BP 129 as amended, jurisdiction for real actions involving pr
Case Syllabus (G.R. No. 214803)
Facts
- On October 13, 2008, Spouses Clarence I. Barrios and Anna Lee T. Barrios borrowed ₱250,000.00 from Alona G. Roldan at 5% monthly interest.
- To secure repayment, the debtors executed a Deed of Real Estate Mortgage over Lot 5891-A-4, Baybay, Makato, Aklan (478 sq. m.), assessed at ₱13,380.00, covered by OCT No. P-5561 pt.
- The loan was payable within one year; payment became overdue as of February 2011, and defendants refused to pay despite repeated demands.
- On June 11, 2012, the Barrios spouses mortgaged the same property to Romel D. Matorres for ₱150,000.00, purportedly in bad faith.
- On February 3, 2014, petitioner filed Civil Case No. 9811 for foreclosure of real estate mortgage against the spouses and Matorres.
Mortgage Details
- Principal obligation: ₱250,000.00; interest rate: 5% per month.
- Collateral: Lot 5891-A-4, Baybay, Makato, Aklan; area: 478 sq. m.; assessed value: ₱13,380.00.
- Certificate of Title: OCT No. P-5561 pt.; property registered in the names of the Barrios spouses.
Allegations and Prayer for Relief
- Petitioner alleged default in payment from February 2011 onwards and sought:
• Payment of ₱250,000.00 plus stipulated interest and ₱25,000.00 for attorney’s fees, litigation expenses, and costs.
• Judicial sale of the mortgaged property upon default.
• Exemplary damages of ₱50,000.00 for unauthorized re-mortgage.
• Such other relief in law and equity.
Respondents’ Defenses and Counterclaims
- Spouses Barrios:
• Challenged accuracy of loan computation.
• Invoked a pending rehabilitation petition (Special Proceeding No. 9845) to suspend foreclosure. - Romel D. Matorres:
• Admitted mortgage but asserted independent foreclosure action (Civil Case No. 9642).
• Denied any transaction with petitioner; claimed l