FIRST DIVISION
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Petitioners,
- versus -
BATANGAS SAVINGS AND LOAN BANK, INC., and THE REGISTER OF
DEEDS, NASUGBU, BATANGAS,
Respondents.
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G.R. No. 182403
Present:
PUNO, C.J., Chairperson,
CARPIO MORALES,
LEONARDO-DE CASTRO,
BERSAMIN, and
VILLARAMA, JR., JJ.
Promulgated:
March 9, 2010
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D E C I S I O N
CARPIO MORALES, J.:
Petitioner Atty. Restituto Cudiamat and his
brother Perfecto were the registered co-owners of a 320 square meter parcel of
land (the property) in Balayan, Batangas, covered by TCT No. T-37889 of the
Register of Deeds of Nasugbu, Batangas. Restituto, who resided in
Ozamiz City with his wife, entrusted the custody of the title to who was residing
in Balayan.
In 1979, Perfecto, without the knowledge and consent of Restituto,
obtained a loan from respondent Batangas Savings and Loan Bank, Inc. (the
bank). To secure the payment of
the loan, Perfecto mortgaged the property for the purpose of which he presented
a Special Power of Attorney (SPA) purportedly executed by Restituto, with the
marital consent of his wife-herein co-petitioner Erlinda Cudiamat.
On June 19, 1991, Restituto was informed, via letter[2] dated June 7, 1991 from the bank, that the
property was foreclosed. He thus, by letter[3] dated June 25, 1991, informed the bank that he
had no participation in the execution of the mortgage and that he never
authorized Perfecto for the purpose.
In the meantime, Perfecto died in 1990. In 1998, as Perfecto’s widow petitioner Corazon
was being evicted from the property, she and her co-petitioner-spouses
Restituto and Erlinda filed on August 9, 1999 before the Regional Trial Court
(RTC) of Balayan a complaint[4] “for quieting of title with damages” against the bank and
the Register of Deeds of Nasugbu, docketed as Civil Case No. 3618, assailing
the mortgage as being null and void as they did not authorize the encumbrance
of the property.
In its Answer to the complaint, the bank, maintaining the validity
of the mortgage, alleged that it had in fact secured a title in its name, TCT
No. T-48405, after Perfecto failed to redeem the mortgage; that the Balayan RTC had no jurisdiction over
the case as the bank had been placed under receivership and under liquidation
by the Philippine Deposit Insurance Corporation (PDIC); that PDIC filed before the RTC of Nasugbu
a petition for assistance in the
liquidation of the bank which was
docketed as SP No. 576; and that jurisdiction to
adjudicate disputed claims against it is lodged with the liquidation court-RTC
Nasugbu.
By Decision of January 17, 2006,[5] Branch 9 of the Balayan RTC rendered judgment,
in the complaint for quieting of title, in favor of the plaintiffs-herein
petitioners. It ordered respondent
Register of Deeds of Nasugbu to cancel the encumbrance annotated on TCT No.
T-37889, and to cancel TCT No. T-48405 issued in the name of the bank and
reinstate the former title. It also directed the bank to return the property to
petitioner spouses Restituto and Erlinda and to pay P20,000 to all the petitioners to defray the costs of suit.
The bank appealed to the Court of Appeals, contending, inter
alia, that the Balayan RTC had no jurisdiction over petitioners’ complaint
for quieting of title.
By the assailed Decision of December 21, 2007,[6] the appellate court, ruling in favor of the
bank, dismissed petitioners’ complaint for quieting of title, without prejudice
to the right of petitioners to take up their claims with the Nasugbu RTC
sitting as a liquidation court.
To the appellate court, the Balayan RTC, as a court of general
jurisdiction, should have deferred to the Nasugbu RTC which sits as a
liquidation court, given that the bank was already under receivership when
petitioners filed the complaint for quieting of title.
Petitioners’ Motion for Reconsideration having been denied by the
appellate court by Resolution of March 27, 2008, they filed the present
petition for review on certiorari.
Assailing the appellate court’s ruling that the Balayan RTC had no
jurisdiction over their complaint, petitioners argue that their complaint was
filed earlier than PDIC’s petition for assistance in the liquidation; and that
the bank is now estopped from questioning the jurisdiction of the Balayan RTC
because it actively participated in the proceedings thereat.
The petition is impressed with merit.
Estoppel bars the bank from raising the issue of lack of
jurisdiction of the Balayan RTC.
In Lozon v. NLRC,[7] the Court came up with a clear rule on when jurisdiction by estoppel applies and
when it does not:
The operation of estoppel on the question
of jurisdiction seemingly depends on whether the lower court actually
had jurisdiction or not. If it had no jurisdiction,
but the case was tried and decided upon the theory that it had jurisdiction, the parties are not barred, on appeal, from
assailing such jurisdiction, for the same “must exist as
a matter of law, and may not be conferred by the consent of the parties
or by estoppel.” However, if
the lower court had jurisdiction, and the case was heard and
decided upon a given theory, such, for instance, as that the court had
no jurisdiction, the party who induced it to adopt such theory
will not be permitted, on appeal, to assume an inconsistent position –
that the lower court had jurisdiction… (underscoring
supplied)
In the present case, the Balayan RTC, sitting as a court of
general jurisdiction, had jurisdiction over the complaint for quieting of title
filed by petitioners on August 9, 1999. The Nasugbu RTC, as a liquidation court, assumed
jurisdiction over the claims against the bank only on May 25, 2000, when PDIC’s
petition for assistance in the liquidation was raffled thereat and given due
course.
While it is well-settled that lack of jurisdiction on the subject
matter can be raised at any time and is not lost by estoppel by laches, the
present case is an exception. To compel petitioners to re-file and relitigate their claims
before the Nasugbu RTC when the parties had already been given the opportunity
to present their respective evidence in a full-blown trial before the Balayan
RTC which had, in fact, decided petitioners’ complaint (about two years before
the appellate court rendered the assailed decision) would be an exercise in
futility and would unjustly burden petitioners.
The Court, in Valenzuela v. Court of
Appeals,[9] held that as a general rule, if there is a
judicial liquidation of an insolvent bank, all claims against the bank should
be filed in the liquidation proceeding. The Court in Valenzuela, however, after
considering the circumstances attendant to the case, held that the general rule
should not be applied if to order the aggrieved party to refile or relitigate
its case before the litigation court would be “an exercise in futility.” Among the circumstances the Court considered in
that case is the fact that the claimants were poor and the disputed parcel of
land was their only property, and the parties’ claims and defenses were
properly ventilated in and considered by the judicial court.
In the present case, the Court finds that analogous considerations
exist to warrant the application of Valenzuela. Petitioner Restituto was 78 years old at the
time the petition was filed in this Court, and his co-petitioner-wife Erlinda
died[10] during the pendency of the case. And, except for co-petitioner Corazon, Restituto
is a resident of Ozamis City. To compel him to appear and relitigate the case in the liquidation
court-Nasugbu RTC when the issues to be raised before it are the same as those
already exhaustively passed upon and decided by the Balayan RTC would be
superfluous.
WHEREFORE,
the petition is GRANTED. The Decision of December 21, 2007 and Resolution dated March 27, 2008
of the Court of Appeals are SET ASIDE. The Decision dated
January 17, 2006 of the Regional Trial Court of Balayan, Batangas, Branch 9 is REINSTATED.
SO ORDERED.
CONCHITA CARPIO MORALES
Associate
Justice