SECOND DIVISION

[G.R. No. 204970. February 1, 2016.]

SPOUSES CLAUDIO and CARMENCITA TRAYVILLA , petitioners, vs.

BERNARDO SEJAS and JUVY PAGLINAWAN, represented by JESSIE
PAGLINAWAN , respondents.

DECISION

DEL CASTILLO , J : p

Assailed in this Petition for Review on Certiorari 1 are the following dispositions
of the Court of Appeals (CA): 1) November 29, 2011 Decision 2 in CA-G.R. SP No. 02315
which granted respondents' Petition for Certiorari and nulli ed the September 3, 2007 3
and February 21, 2008 4 Orders of Branch 18 of the Regional Trial Court (RTC), 9th
Judicial Region, Pagadian City in Civil Case No. 4633-2K5; and 2) November 19, 2012
Resolution 5 denying the petitioners' motion for reconsideration.
Factual Antecedents
In 2005, petitioners Claudio and Carmencita Trayvilla instituted before the RTC
Civil Case No. 4633-2K5 against respondent Bernardo Sejas (Sejas). In their Complaint
6 for speci c performance and damages, petitioners claimed among others that Sejas
was the registered owner of a 434-square meter parcel of land in Tukuran, Zamboanga
del Sur covered by Transfer Certi cate of Title No. T-8,337 7 (TCT T-8,337); that by
virtue of a private handwritten document, 8 Sejas sold said parcel of land to them in
1982; that thereafter, they took possession of the land and constructed a house
thereon; that they resided in said house and continued to reside therein; that Sejas later
reasserted his ownership over said land and was thus guilty of fraud and deceit in so
doing; and that they caused the annotation of an adverse claim. They prayed that Sejas
be ordered to execute a nal deed of sale over the property and transfer the same to
them, and that they be awarded the sum of P30,000.00 as attorney's fees plus
P1,500.00 per court appearance of counsel.
In an Amended Complaint, 9 this time for speci c performance, reconveyance,
and damages, petitioners impleaded respondent Juvy Paglinawan (Paglinawan) as
additional defendant, claiming that Sejas subsequently sold the subject property to her,
after which she caused the cancellation of TCT T-8,337 and the issuance of a new title
— TCT T-46,627 — in her name. Petitioners prayed that Sejas be ordered to execute a
nal deed of sale in their favor and transfer the property to them; that Paglinawan's TCT
T-46,627 be canceled and the property be reconveyed to them; and that they be
awarded P50,000.00 in moral damages, in addition to the P30,000.00 attorney's fees
and P1,500.00 per court appearance of counsel originally prayed for in the Complaint.
However, the additional docket fees for the moral damages prayed for in the
Amended Complaint were not paid. 10 Likewise, for the additional causes of action, no
docket fees were charged and paid.
Respondents moved for dismissal of the case, claiming lack of jurisdiction over
the subject matter and prescription. The RTC denied the motion in a September 3, 2007
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 Order. 11
Respondents led a Motion for Reconsideration, 12 arguing that petitioners' case
was not for speci c performance but was in reality a real action or one involving title to
and possession of real property, in which case the value of the property should be
alleged in the complaint in order that the proper ling fee may be computed and paid;
that since the value of the land was not alleged in the Amended Complaint, the proper
ling fee was not paid, and for this reason the case should be dismissed; and that
petitioners' cause of action is barred by prescription since the 10-year period to sue
upon the handwritten contract — counted from their purchase of the land in 1982 — had
already lapsed when they led the case in 2005. However, in a February 21, 2008 Order,
13 the RTC denied the motion, stating among others that petitioners' case is not a real
action but indeed one for speci c performance and thus one which is incapable of
pecuniary estimation. caITAC

Ruling of the Court of Appeals

Respondents led an original Petition for Certiorari 14 before the CA, which was
docketed as CA-G.R. SP No. 02315. On November 29, 2011, the CA issued the assailed
Decision, which contained the following pronouncement:
The petition is meritorious.
Jurisdiction is de ned as the authority to hear and determine a cause or
the right to act in a case. In addition to being conferred by the Constitution and
the law, the rule is settled that a court's jurisdiction over the subject matter is
determined by the relevant allegations in the complaint, the law in effect when
the action is led, and the character of the relief sought irrespective of whether
the plaintiff is entitled to all or some of the claims asserted.
Consistent with Section 1, Rule 141 of the Revised Rules of Court which
provides that the prescribed fees shall be paid in full "upon the ling of the
pleading or other application which initiates an action or proceeding", the well-
entrenched rule is to the effect that a court acquires jurisdiction over a case only
upon the payment of the prescribed filing and docket fees.
Rule 141 of the Rules of Court, as amended by A.M. No. 04-2-04-SC and
Supreme Court Amended Administrative Circular No. 35-2004, provides that:
SEC. 7. Clerks of Regional Trial Courts. —
(a) For ling an action or a permissive OR COMPULSORY
counterclaim, CROSSCLAIM, or money claim against an estate not
based on judgment, or for ling a third-party, fourth-party, etc.,
complaint, or a complaint-in-intervention, if the total sum claimed,
INCLUSIVE OF INTERESTS, PENALTIES, SURCHARGES, DAMAGES
OF WHATEVER KIND, AND ATTORNEY'S FEES, LITIGATION
EXPENSES AND COSTS and/or in cases involving property, the FAIR
MARKET value of the REAL property in litigation STATED IN THE
CURRENT TAX DECLARATION OR CURRENT ZONAL VALUATION OF
THE BUREAU OF INTERNAL REVENUE, WHICHEVER IS HIGHER, OR
IF THERE IS NONE, THE STATED VALUE OF THE PROPERTY IN
LITIGATION OR THE VALUE OF THE PERSONAL PROPERTY IN
LITIGATION . . . AS ALLEGED BY THE CLAIMANT, is:
[Table of fees omitted.]
If the action involves both a money claim and relief pertaining to
property, then THE fees will be charged on both the amounts
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 claimed and value of property based on the formula prescribed in
this paragraph a.
(b) For filing:
1. Actions where the value of the subject matter cannot be
estimated
2. Special civil actions, except judicial foreclosure of mortgage,
EXPROPRIATION PROCEEDINGS, PARTITION AND QUIETING
OF TITLE which will [sic]
3. All other actions not involving property
[Table of fees omitted.]
The docket fees under Section 7(a), Rule 141, in cases involving real
property depend on the fair market value of the same: the higher the value of the
real property, the higher the docket fees due. In contrast, Section 7(b)(1), Rule
141 imposes a xed or at rate of docket fees on actions incapable of
pecuniary estimation.
xxx xxx xxx
As can be gleaned from the records, the Amended Complaint was styled
as one for 'Speci c Performance and Damages,' whereby private respondents
15 sought to compel petitioner Sejas to execute the deed of sale over the subject
land in their favor on the premise that they bought the said land from petitioner
Sejas through a private document. They declared themselves to be the true and
real owners of the subject land and had in fact taken possession over it to the
exclusion of others including petitioner Sejas.
While it may appear that the suit led is one for speci c performance,
hence an action incapable of pecuniary estimation, a closer look at the
allegations and reliefs prayed for in the Complaint, however, shows that private
respondents were not merely seeking the execution of the deed of sale in their
favor. They were also asking the lower court earnestly to cancel TCT No. T-
46,627 which was allegedly issued to petitioner Paglinawan through fraudulent
means and have the same reconveyed to them as the owners of the subject
land. The ultimate purpose then of private respondents in ling the complaint
before the RTC is to secure their vaunted ownership and title to the subject land
which they claimed was purchased from petitioner Sejas. Their cause of action
clearly springs from their right as purchaser of the subject land. Under these
circumstances, the suit before the RTC is a real action, affecting as it did title to
the real property sought to be reconveyed. A real action is one in which the
plaintiff seeks the recovery of real property; or, as indicated in what is now
Section 1, Rule 4 of the Rules of Court, a real action is an action affecting title to
or recovery of possession of real property. ICHDca

Section 7, Rule 141 of the Rules of Court, prior to its amendment by A.M.
No. 04-2-04-SC, had a speci c paragraph governing the assessment of the
docket fees for real action, to wit:
In a real action, the assessed value of the property, or if there is
none, the estimated value thereof shall be alleged by the claimant
and shall be the basis in computing the fees.
But it is important to note that, with the amendments introduced by A.M.
No. 04-2-04-SC, which became effective on 16 August 2004, the paragraph in
Section 7, Rule 141 of the Rules of Court, pertaining speci cally to the basis for
the computation of docket fees for real actions was deleted. Instead, Section
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 7(1) of Rule 141, as amended, provides that 'in cases involving real property, the
FAIR MARKET value of the REAL property in litigation STATED IN THE
CURRENT TAX DECLARATION OR CURRENT ZONAL VALUATION OF THE
BUREAU OF INTERNAL REVENUE, WHICH [sic] IS HIGHER, OR IF THERE IS
NONE, THE STATED VALUE OF THE PROPERTY IN LITIGATION . . .' shall be the
basis for the computation of the docket fees.
Unfortunately, private respondents never alleged in their Amended
Complaint, much less in the prayer portion thereof, the fair market value of the
subject res as stated in the Tax Declaration or current zonal valuation of the
Bureau of Internal Revenue, which [sic] is higher, or if there is none, the stated
value thereof, to serve as basis for the receiving clerk in computing and arriving
at the proper amount of filing fee due thereon. In the absence of such allegation,
it cannot be determined whether the RTC or the MTC has original and exclusive
jurisdiction over the petitioners' action. There is therefore no showing on the
face of the complaint that the RTC has exclusive jurisdiction over the action of
the private respondents. Hence, the RTC erred in taking cognizance of the case
despite private respondents' non-payment of the correct docket fees which must
be computed in accordance with Section 7(1), Rule 141 of the Rules of Court, as
amended.
The consistent rule is that 'a case is deemed led only upon payment of
the docket fee regardless of the actual date of ling in court,' and that
jurisdiction over any case is acquired only upon the payment of the prescribed
docket fee which is both mandatory and jurisdictional. . . .
xxx xxx xxx
This case at bench bears similarity to Gochan v. Gochan , 16 where the
Supreme Court held that although the caption of the complaint led by therein
respondents Mercedes Gochan, et al. with the RTC was denominated as one for
'speci c performance and damages,' the relief sought was the conveyance or
transfer of real property, or ultimately, the execution of deeds of conveyance in
their favor of the real properties enumerated in the provisional memorandum of
agreement. Under these circumstances, the case before the RTC was actually a
real action, affecting as it did title to or possession of real property.
Consequently, the basis for determining the correct docket fees shall be the
assessed value of the property, or the estimated value thereof as alleged in the
complaint. But since Mercedes Gochan failed to allege in their complaint the
value of the real properties, the Court found that the RTC did not acquire
jurisdiction over the same for non-payment of the correct docket fees.
More to the point is Huguete v. Embudo . 17 There, petitioners argued that
a complaint for annulment of a deed of sale and partition is incapable of
pecuniary estimation, and thus falls within the exclusive jurisdiction of the RTC.
However, the Supreme Court ruled that 'the nature of an action is not determined
by what is stated in the caption of the complaint but by the allegations of the
complaint and the reliefs prayed for. Where the ultimate objective of the
plaintiffs, like petitioners herein, is to obtain title to real property, it should be
led in the proper court having jurisdiction over the assessed value of the
property subject thereof.' TCAScE

Likewise, in Siapno v. Manalo , 18 the Supreme Court disregarded the

title/denomination of therein plaintiff Manalo's amended petition as one for
Mandamus with Revocation of Title and Damages; and adjudged the same to
be a real action, the ling fees for which should have been computed based on
the assessed value of the subject property or, if there was none, the estimated
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 value thereof. . . .
xxx xxx xxx
In ne, We rule and so hold that the RTC never acquired jurisdiction over
Civil Case No. 4633-2K5, hence, its act of taking cognizance of the subject
Complaint was tainted with grave abuse of discretion amounting to lack or
excess of jurisdiction. Grave abuse of discretion is de ned as capricious and
whimsical exercise of judgment as is equivalent to lack of jurisdiction.
Given the foregoing, this Court nds it unnecessary to dwell on the issue
of prescription raised by petitioners.
WHEREFORE, premises considered, the instant Petition is hereby
GRANTED. The Orders dated 03 September 2007 and 21 February 2008,
respectively, of the Regional Trial Court (RTC), 9th Judicial Region, Branch 18,
Pagadian City, are DECLARED NULL and VOID for having been issued without
jurisdiction. The Amended Complaint led [sic] private respondents docketed as
Civil Case No. 4633-2K5 is hereby DISMISSED.
SO ORDERED. 19
Petitioners led a Motion for Reconsideration, 20 which the CA denied in its
assailed November 19, 2012 Resolution. Hence, the present Petition.
In a March 19, 2014 Resolution, 21 the Court resolved to give due course to the
instant Petition.
Issues
Petitioners raise the following issues:
1. Did the Court of Appeals ruled [sic] correctly when it dismissed the
complaint by reason of Petitioner-Appellants' alleged non-payment of the
correct dockets [sic] fees due to its [sic] failure to alleged [sic] the fair market
value or the stated value of the subject property in the amended complaint?
2. Did the ling of the amended complaint su ciently divested [sic]
and ousted [sic] the trial court of its jurisdiction over the case that had initially
validly attached by virtue of the Original complaint for specific performance? 22
Petitioners' Arguments
In praying that the assailed CA dispositions be set aside and that their Amended
Complaint in Civil Case No. 4633-2K5 be reinstated, petitioners contend in their Petition
and Reply 23 that it was error for the CA to order the dismissal of their Amended
Complaint simply because additional causes of action were alleged and new reliefs
were prayed for, and the additional docket fees therefor were not paid; that while
reconveyance was sought in the Amended Complaint, the principal action was still for
speci c performance, and the reconveyance prayed for was merely incidental thereto;
that since the trial court acquired jurisdiction over the case with the ling of the original
Complaint, it did not lose the same as a result of the ling of the Amended Complaint;
that jurisdiction continued to attach even with the submission of the Amended
Complaint; that their failure to pay the additional docket fees required for the Amended
Complaint does not result in loss of jurisdiction over the case — instead, the Amended
Complaint is simply not admitted and the original Complaint retrains; 24 that instead of
dismissing the case, the Amended Complaint should have been disregarded, or
petitioners should have been ordered to pay the de ciency in docket fees within a
reasonable period of time; that "the rule now is that the court may allow a reasonable
time for the payment of the prescribed fees, or the balance thereof, and upon such
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 payment, the defect is cured and the court may properly take cognizance of the action,
unless in the meantime prescription has set in and consequently barred the right of
action;" 25 and that the rules of procedure should be liberally applied in their case, as
there is no intention to evade the payment of additional docket fees, as is shown by the
payment of the original filing fees when the case was instituted.
Respondents' Arguments
Respondents, on the other hand, argue in their Comment 26 that the CA was
correct in ruling that Civil Case No. 4633-2K5 should be dismissed; that while the
complaint is for speci c performance, the relief prayed for includes reconveyance,
which is a real action — in which case the assessed value of the property should have
been alleged for the proper computation of the docket fees. Thus, they pray for the
denial of the Petition, with double costs against petitioners. cTDaEH

Our Ruling
The Court denies the Petition.
As correctly ruled by the CA, while petitioners' Amended Complaint was
denominated as one mainly for speci c performance, they additionally prayed for
reconveyance of the property, as well as the cancellation of Paglinawan's TCT T-46,627.
In other words, petitioners' aim in ling Civil Case No. 4633-2K5 was to secure their
claimed ownership and title to the subject property, which quali es their case as a real
action. Pursuant to Section 1, Rule 4 of the 1997 Rules of Civil Procedure, 27 a real
action is one that affects title to or possession of real property, or an interest therein.
Since Civil Case No. 4633-2K5 is a real action made so by the Amended
Complaint later led, petitioners should have observed the requirement under A.M. No.
04-2-04-SC 28 relative to declaring the fair market value of the property as stated in the
current tax declaration or zonal valuation of the Bureau of Internal Revenue (BIR). Since
no such allegation was made in the Amended Complaint, then the value of the subject
property as stated in the handwritten document sued upon and restated in the
Amended Complaint should be the basis for determining jurisdiction and the amount of
docket fees to be paid.
The CA is correct in its general observation that in the absence of the required
declaration of the fair market value as stated in the current tax declaration or zonal
valuation of the property, it cannot be determined whether the RTC or rst level court
has original and exclusive jurisdiction over the petitioners' action, since the jurisdiction
of these courts is determined on the basis of the value of the property. Under
applicable rules,
Jurisdiction of RTCs, as may be relevant to the instant petition, is
provided in Sec. 19 of BP 129, 29 which reads: ITAaHc

Sec. 19. Jurisdiction in civil cases. — Regional Trial Courts

shall exercise exclusive original jurisdiction:
1) In all civil actions in which the subject of the
litigation is incapable of pecuniary estimation;
2) In all civil actions which involve the title to, or
possession of, real property, or any interest therein, where the
assessed value of the property involved exceeds Twenty thousand
pesos (P20,000.00) or, for civil actions in Metro Manila, where
such value exceeds Fifty thousand pesos (P50,000.00) except
actions for forcible entry into and unlawful detainer of lands or
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 buildings, original jurisdiction over which is conferred upon the
Metropolitan Trial Courts, Municipal Trial Courts, and Municipal
Circuit Trial Courts.
On the other hand, jurisdiction of rst level courts is prescribed in Sec. 33
of BP 129, which provides:
Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal
Trial Courts and Municipal Circuit Trial Courts in civil cases. —
Metropolitan Trial Courts, Municipal Trial Courts, and Municipal
Circuit Trial Courts shall exercise:
xxx xxx xxx
3) Exclusive original jurisdiction in all civil actions
which involve title to, or possession of, real property, or any
interest therein where the assessed value of the property or
interest therein does not exceed Twenty thousand pesos
(P20,000.00) or, in civil actions in Metro Manila, where such
assessed value does not exceed Fifty thousand pesos
(P50,000.00) exclusive of interest, damages of whatever kind,
attorney's fees, litigation expenses and costs: Provided, That in
cases of land not declared for taxation purposes, the value of
such property shall be determined by the assessed value of the
adjacent lots. 30
However, the CA failed to consider that in determining jurisdiction, it could rely on
the declaration made in the Amended Complaint that the property is valued at
P6,000.00. The handwritten document sued upon and the pleadings indicate that the
property was purchased by petitioners for the price of P6,000.00. For purposes of filing
the civil case against respondents, this amount should be the stated value of the
property in the absence of a current tax declaration or zonal valuation of the BIR. Rule
141 of the Rules of Court, as amended by A.M. No. 04-2-04-SC and Supreme Court
Amended Administrative Circular No. 35-2004, provides that —
a) For ling an action or a permissive OR COMPULSORY counter-
claim, CROSS-CLAIM, or money claim against an estate not based on judgment,
or for ling a third-party, fourth-party, etc. complaint, or a complaint-in-
intervention, if the total sum claimed, INCLUSIVE OF INTERESTS, PENALTIES,
SURCHARGES, DAMAGES OF WHATEVER KIND, AND ATTORNEY'S FEES,
LITIGATION EXPENSES AND COSTS and/or in cases involving property, the
FAIR MARKET value of the REAL property in litigation STATED IN THE
CURRENT TAX DECLARATION OR CURRENT ZONAL VALUATION OF THE
BUREAU OF INTERNAL REVENUE, WHICHEVER IS HIGHER, OR IF THERE IS
NONE, THE STATED VALUE OF THE PROPERTY IN LITIGATION OR THE
VALUE OF THE PERSONAL PROPERTY IN LITIGATION AS ALLEGED BY THE
CLAIMANT . . . (Emphasis supplied)
shall be the basis for the computation of the docket fees to be paid. Since the value of
the subject property as stated in the Amended Complaint is just P6,000.00, then the
RTC did not have jurisdiction over petitioners' case in the rst instance; it should have
dismissed Civil Case No. 4633-2K5. But it did not. In continuing to take cognizance of
the case, the trial court clearly committed grave abuse of discretion.
WHEREFORE , the Petition is DENIED . The assailed November 29, 2011
Decision and November 19, 2012 Resolution of the Court of Appeals in CA-G.R. SP No.
02315 are AFFIRMED .
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 SO ORDERED .
Carpio, Brion, Mendoza and Leonen, JJ., concur.

Footnotes

1. Rollo, pp. 21-34.

2. Id. at 36-47; penned by Associate Justice Zenaida T. Galapate-Laguilles and concurred in
by Associate Justices Edgardo A. Camello and Pamela Ann Abella Maxino.
3. CA rollo, p. 31; penned by Judge Reinerio (Abraham) B. Ramas.
4. Id. at 37-38.
5. Rollo, pp. 5-6; penned by Associate Justice Edgardo A. Camello and concurred in by
Associate Justices Renato C. Francisco and Oscar V. Badelles.
6. Id. at 48-52.
7. Id. at 53.

8. Id. at 54.
9. Id. at 63-68.
10. Id. at 23.
11. CA rollo, p. 31.
12. Id. at 32-36.

13. Id. at 37-38.

14. Id. at 3-13.
15. Herein petitioners.
16. 423 Phil. 491 (2001).

17. 453 Phil. 170 (2003).

18. 505 Phil. 430 (2005).
19. Rollo, pp. 39-47.
20. CA rollo, pp. 70-77.
21. Rollo, pp. 113-114.

22. Id. at 26.

23. Id. at 106-108; Manifestation treated as petitioners' Reply.
24. Citing Home Guaranty Corporation v. R-II Builders, Inc., 660 Phil. 517 (2011).
25. Citing Tacay v. Regional Trial Court of Tagum, Davao del Norte, Branches 1 & 2 , 259 Phil.
927, 938 (1989).
26. Rollo, pp. 97-102.

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 27. Section 1. Venue of real actions. — Actions affecting title to or possession of real property,
or interest therein, shall be commenced and tried in the proper court which has
jurisdiction over the area wherein the real property involved, or a portion thereof, is
situated.
Forcible entry and detainer actions shall be commenced and tried in the municipal trial court
of the municipality or city wherein the real property involved, or a portion thereof, is
situated.
28. REVISED RULES OF COURT LEGAL FEES.
29. As amended by Republic Act No. 7691, entitled "AN ACT EXPANDING THE JURISDICTION
OF THE METROPOLITAN TRIAL COURTS, MUNICIPAL TRIAL COURTS, AND
MUNICIPAL CIRCUIT TRIAL COURTS, AMENDING FOR THE PURPOSE BATAS
PAMBANSA BLG. 129, OTHERWISE KNOWN AS THE 'JUDICIARY REORGANIZATION
ACT OF 1980'."
30. Surviving Heirs of Alfredo R. Bautista v. Lindo , G.R. No. 208232, March 10, 2014, 718
SCRA 321, 328-329.

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