Sun Insurance vs Asuncion (Remedial Law)

SUN INSURANCE OFFICE, LTD., (SIOL), E.B. PHILIPPS and D.J. WARBY
vs.
HON. MAXIMIANO C. ASUNCION (Judge, RTC Quezon City) and MANUEL CHUA UY PO TIONG

G.R. Nos. 79937-38; February 13, 1989; GANCAYCO, J.

FACTS:  On February 28, 1984, petitioner Sun Insurance filed a complaint with the RTC Makati for the consignation of a premium refund on a fire insurance policy with a prayer for the judicial declaration of its nullity against private respondent Manuel Uy Po Tiong. Private respondent as declared in default for failure to file the required answer within the reglementary period.

On the other hand, on March 28, 1984, private respondent filed a complaint in the RTC QC for the refund of premiums and the issuance of a writ of preliminary attachment, initially against petitioner Sun Insurance, and thereafter including E.B. Philipps and D.J. Warby as additional defendants. The complaint docketed as Civil Case Q-41177 sought, among others, the payment of damages. Although the prayer in the complaint did not quantify the amount of damages sought said amount may be inferred from the body of the complaint to be about P50 Million.

Only the amount of P210.00 was paid by private respondent as docket fee which prompted petitioners' counsel to raise his objection. Said objection was disregarded by respondent Judge Jose P. Castro who was then presiding over said case. Upon the order of this Court, the records of said case together with 22 other cases assigned to different branches of the RTC QC which were under investigation for under-assessment of docket fees were transmitted to the SC. The SC ordered that the cases be re-raffled, the judges in said cases to reassess the docket fees and that in case of deficiency, to order its payment. The Resolution also requires all clerks of court to issue certificates of re-assessment of docket fees. All litigants were likewise required to specify in their pleadings the amount sought to be recovered in their complaints.

Thus, Judge Solano, to whose sala Civil Case Q-41177 was temporarily assigned, instructed the Clerk of Court to issue a certificate of assessment of the docket fee paid by private respondent and, in case of deficiency, to include the same in said certificate. On January 7, 1984, to forestall a default, a cautionary answer was filed by petitioners. On August 30,1984, an amended complaint was filed by private respondent including the two additional defendants aforestated.

Respondent Judge Asuncion, to whom Civil Case No. Q41177 was thereafter assigned, after his assumption into office on January 16, 1986, issued a Supplemental Order requiring the parties in the case to comment on the Clerk of Court's letter-report signifying her difficulty in complying with the Resolution of the SC since the pleadings filed by private respondent did not indicate the exact amount sought to be recovered. Private respondent filed a "Compliance" and a "Re-Amended Complaint" stating therein a claim of "not less than P10 Million as actual compensatory damages" in the prayer. In the body of the said second amended complaint however, private respondent alleges actual and compensatory damages and attorney's fees in the total amount of about P44,601,623.70.

On January 24, 1986, Judge Asuncion issued another Order admitting the second amended complaint and stating therein that the same constituted proper compliance with the SC Resolution and that a copy thereof should be furnished the Clerk of Court for the reassessment of the docket fees. The reassessment by the Clerk of Court based on private respondent's claim of "not less than P10 M as actual and compensatory damages" amounted to P39,786.00 as docket fee. This was subsequently paid by private respondent.

Petitioners then filed a petition for certiorari with the CA questioning the said order of Judge Asuncion.

On April 24, 1986, private respondent filed a supplemental complaint alleging an additional claim of P20 M as damages so the total claim amounts to about P65 Million. Seven months after filing the supplemental complaint, the private respondent paid the additional docket fee of P80,396.00.

On August 13, 1987, the CA denied the petition insofar as it seeks annulment of the order, and petitioner’s motion to dismiss the amended complaint. Hence, the instant petition.

During the pendency of this petition and in conformity with the said judgment of respondent court, private respondent paid the additional docket fee of P62,432.90 on April 28, 1988.

ISSUE:

Did the RTC acquire jurisdiction over Civil Case No. Q-41177 even if there was nonpayment of the correct and proper docket fee?

Petitioners’ contention: Considering that the total amount sought to be recovered in the amended and supplemental complaint is P64,601,623.70 the docket fee that should be paid by private respondent is P257,810.49, more or less. Not having paid the same, petitioners contend that the complaint should be dismissed and all incidents arising therefrom should be annulled. As basis, petitioners cite Manchester Development Corporation vs. CA:

The Court acquires jurisdiction over any case only upon the payment of the prescribed docket fee. An amendment of the complaint or similar pleading will not thereby vest jurisdiction in the Court, much less the payment of the docket fee based on the amounts sought in the amended pleading. The ruling in the Magaspi Case in so far as it is inconsistent with this pronouncement is overturned and reversed.

Respondent’s contention: Manchester cannot apply retroactively for at the time said civil case was filed in court there was no such ruling as yet. Magaspi v. Ramolete applies wherein it was held that the trial court acquired jurisdiction over the case even if the docket fee paid was insufficient.

HELD: YES, the court acquired jurisdiction over the case.

Nevertheless, the contention that Manchester cannot retroactively apply is untenable. Statutes regulating the procedure of the courts will be construed as applicable to actions pending and undetermined at the time of their passage. Procedural laws are retrospective in that sense and to that extent.

In Lazaro vs. Endencia and Andres, this Court held that the payment of the full amount of the docket fee is an indispensable step for the perfection of an appeal. Plaintiff-appellant deposited the deficiency in the docket fee outside the 15-day reglementary period for appeal. Thus, the CFI (as appellate court) did not acquire jurisdiction as the appeal was not perfected.

In Lee vs. Republic, the petitioner filed a verified declaration of intention to become a Filipino citizen by sending it through registered mail to the Office of the Solicitor General in 1953 but the required filing fee was paid only in 1956. Citing Lazaro, this Court concluded that the filing of petitioner's declaration of intention on October 23, 1953 produced no legal effect until the required filing fee was paid on May 23, 1956.

In Malimit vs. Degamo, the same principles enunciated in Lazaro and Lee were applied. It was an original petition for quo warranto contesting the right to office of proclaimed candidates which was mailed, addressed to the clerk of the CFI, within the one-week period after the proclamation as provided therefor by law. However, the required docket fees were paid only after the expiration of said period. Consequently, this Court held that the date of such payment must be deemed to be the real date of filing of aforesaid petition and not the date when it was mailed.

Again, in Garica vs, Vasquez, this Court reiterated the rule that the docket fee must be paid before a court will act on a petition or complaint. However, we also held that said rule is not applicable when petitioner seeks the probate of several wills of the same decedent as he is not required to file a separate action for each will but instead he may have other wills probated in the same special proceeding then pending before the same court.

Then in Magaspi, this Court reiterated the ruling in Malimit and Lee that a case is deemed filed only upon payment of the correct docket fee regardless of the actual date of its filing in court. In the said case, there was an honest difference of opinion as to the correct amount to be paid as docket fee because the action appears to be one for the recovery of property the docket fee of P60.00 was correct; and that as the action is also one, for damages, the SC upheld the assessment of the additional docket fee based on the damages alleged in the amended complaint as against the assessment of the trial court which was based on the damages alleged in the original complaint.

However, SC overturned Magaspi in Manchester. Manchester involves an action for torts and damages and specific performance with a prayer for the issuance of a temporary restraining order, etc.. The amount of damages sought is not specified in the prayer although the body of the complaint alleges the total amount of over P78 Millon allegedly suffered by plaintiff. Applying the principle in Magaspi that "the case is deemed filed only upon payment of the docket fee regardless of the actual date of filing in court," this Court held that the trial court did not acquire jurisdiction over the case by payment of only P410.00 for the docket fee. Neither can the amendment of the complaint thereby vest jurisdiction upon the Court. For all legal purposes there was no such original complaint duly filed which could be amended. Consequently, the order admitting the amended complaint and all subsequent proceedings and actions taken by the trial court were declared null and void.

The facts and circumstances of the present case are similar to Manchester. The principle in Manchester could very well be applied in the present case. The pattern and the intent to defraud the government of the docket fee due is obvious not only in the filing of the original complaint but also in the filing of the second amended complaint.

However, in Manchester, petitioner did not pay any additional docket fee untill the case was decided by the SC on May 7, 1987. Thus, in Manchester, due to the fraud committed on the government, this Court held that the court a quo did not acquire jurisdiction over the case and that the amended complaint could not have been admitted inasmuch as the original complaint was null and void.

In the present case, a more liberal interpretation of the rules is called for considering that, unlike Manchester, private respondent demonstrated his willingness to abide by the rules by paying the additional docket fees as required.

Nevertheless, petitioners contend that the docket fee that was paid is still insufficient considering the total amount of the claim. This is a matter which the clerk of court of the lower court and/or his duly authorized docket clerk or clerk in-charge should determine and, thereafter, if any amount is found due, he must require the private respondent to pay the same.

Thus, the Court rules as follows:

1. It is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the prescribed docket fee, that vests a trial court with jurisdiction over the subject matter or nature of the action. Where the filing of the initiatory pleading is not accompanied by payment of the docket fee, the court may allow payment of the fee within a reasonable time but in no case beyond the applicable prescriptive or reglementary period.

2. The same rule applies to permissive counterclaims, third party claims and similar pleadings, which shall not be considered filed until and unless the filing fee prescribed therefor is paid. The court may also allow payment of said fee within a reasonable time but also in no case beyond its applicable prescriptive or reglementary period.

3. Where the trial court acquires jurisdiction over a claim by the filing of the appropriate pleading and payment of the prescribed filing fee but, subsequently, the judgment awards a claim not specified in the pleading, or if specified the same has been left for determination by the court, the additional filing fee therefor shall constitute a lien on the judgment. It shall be the responsibility of the Clerk of Court or his duly authorized deputy to enforce said lien and assess and collect the additional fee.

WHEREFORE, the petition is DISMISSED for lack of merit. The Clerk of Court of the court a quo is hereby instructed to reassess and determine the additional filing fee that should be paid by private respondent considering the total amount of the claim sought in the original complaint and the supplemental complaint as may be gleaned from the allegations and the prayer thereof and to require private respondent to pay the deficiency, if any, without pronouncement as to costs.