832 Phil.

1044 WHEREFORE, in view of the foregoing, the present case is hereby ORDERED
DISMISSED for being improperly filed before the Regional Trial Court of
Davao City and for failure to comply with a condition precedent prior to its
THIRD DIVISION filing.

SO ORDERED.[7]
[ G.R. No. 234499. June 06, 2018 ]
Petitioner moved for the RTC-Davao to reconsider[8] its Order dismissing the complaint
RUDY L. RACPAN, PETITIONER, VS. SHARON BARROGA-HAIGH, but the trial court remained steadfast and denied his motion in its June 19, 2004 Order.
RESPONDENT. [9] Hence, the petitioner came to the CA on appeal.[10]

DECISION
Ruling of the Court of Appeals
VELASCO JR., J.:
As stated at the outset hereof, the appellate court affirmed the dismissal of the
Nature of the Case petitioner's Complaint as follows:

This treats of the Petition for Review on Certiorari under Rule 45 of the Rules of Court, WHEREFORE, the order dated September 18, 2013 of the Regional Trial
Court, Branch 11, Davao City in Civil Case No. 34,742-12 is AFFIRMED.
assailing the February 13, 2017 Decision[1] and August 17, 2017 Resolution[2] of the
Court of Appeals (CA) in CA G.R. CV No. 04034-MIN. Said rulings affirmed the dismissal
SO ORDERED.[11]
of the petitioner's complaint for improper venue and failure to comply with a condition
precedent to its filing. The CA explained that petitioner's Complaint is a real action as it wants the court to
abrogate and nullify. whatever right or claim the respondent might have on the
Factual Antecedents property subject of the Deed of Sale. Hence, for the appellate court, Section 1, Rule 4
of the Rules of Court is applicable. Under this Rule, real actions shall be commenced
Petitioner Rudy Racpan filed a Complaint "For Declaration For Nullity of Deed of Sale and tried in the proper court which has jurisdiction over the area wherein the real
with Right to Repurchase & Attorney's Fees"[3] before the Regional Trial Court of Davao property involved is situated. As the property involved is located in Bo. Tuganay,
City, Branch 11 (RTC-Davao). In his Complaint, which was docketed as Civil Case No. Municipality of Cannen, Province of Davao del Norte, the appellate court held that the
34, 742-2012, petitioner alleged that after his wife's death on November 12, 2011, he Complaint should have been lodged with the RTC of Davao del Norte and not the RTC-
instructed their daughter to arrange his wife's important documents. In so doing, their Davao.
daughter discovered a Deed of Sale with Right to Purchase dated March 29, 2011. The
Deed of Sale was purportedly signed by him and his late wife and appeared to convey Further, the CA found that the petitioner's prayer for the issuance of a writ of
to respondent Sharon Barroga-Haigh a real property registered in his name under TCT preliminary injunction is a mere ploy to avoid the requirement of a barangay
No. T-142-2011009374 and located in Bo. Tuganay, Municipality of Carmen, Province of conciliation, as a mere annotation of a notice of lis pendens would achieve the same
Davao del Norte.[4] Petitioner maintained that the Deed of Sale was falsified and effect without having to undergo trial or post a bond.
fictitious as he never signed any contract, not even any special power of attorney, for
the sale or conveyance of the property which is still in his possession. Thus, he prayed In a Resolution dated August 17, 2017[12] the CA stood its ground by denying the
for the declaration of the Deed of Sale's nullity.
petitioner's Motion for Reconsideration.[13]

In her Answer with Compulsory Counterclaim,[5] respondent contended, by way of Hence, the petitioner's present recourse, it being his contention that the Complaint he
affirmative defense, that the venue of the Complaint was improperly laid and that the interposed with the RTC-Davao is a personal action. He maintains that his Complaint is
filing of the case lacks the mandatory requirement of Barangay Clearance. not concerned with title to or possession of real property, as in fact, no transfer of
Subsequently, respondent filed a motion for preliminary hearing on her affirmative
possession or title of the real property to the respondent has occurred.[14] For the
defenses.
petitioner, the Complaint's venue was properly laid in Davao City where both he and the
respondent reside.
Acting on the motion, the RTC-Davao set the case for preliminary hearing and
thereafter issued an Order dated September 18, 2013[6] dismissing the petitioner's Petitioner likewise reiterated that, as his Complaint was coupled with a prayer for the
Complaint as follows: issuance of a writ of preliminary injunction, it is exempt from barangay conciliation
proceedings. may include those brought for the recovery of personal property, or for the
enforcement of some contract or recovery of damages for its breach, or for
Issue the recovery of damages for the commission of an injury to the person or
property. The venue of a personal action is the place where the plaintiff or
The main and decisive issue for resolution is whether the CA erred in affirming the any of the principal plaintiffs resides, or where the defendant or any of the
dismissal of the petitioner's Complaint. principal defendants resides, or in the case of a non-resident defendant
where he may be found, at the election of the plaintiff, for which reason the
Our Ruling action is considered a transitory one.

The petition is impressed with merit. Otherwise stated, what determines the venue of a case is the primary objective for the
filing of the case.[16] On one hand, if the plaintiff seeks the recovery of personal
The venue was properly laid as the complaint was a personal action. property, the enforcement of a contract or the recovery of damages, his complaint is a
personal action that may be filed in the place of residence of either party. On the other
By weight of jurisprudence, the nature of an action is determined by the allegations in hand, if the plaintiff seeks the recovery of real property, or if the action affects title to
the complaint. In turn, the nature of the action determines its proper venue. Rule 4 of real property or for the recovery of possession, or for partition or condemnation of, or
the Rules of Court provides the rules on the situs for bringing real and personal actions, foreclosure of mortgage on, real property, then the complaint is a real action that must
viz: be brought before the court where the real property is located. Thus, in Chua v. Total
Office Products and Services, Inc.,[17] this Court ruled that where the action is not
Rule 4
intended for the recovery of real property but solely for the annulment of a contract, it
is a personal action that may be filed in the court where the plaintiff or the respondent
VENUE OF ACTIONS
resides. It held:

Section 1. Venue of real actions. - Actions affecting title to or possession of Well-settled is the rule that an action to annul a contract of loan and its
real property, or interest therein, shall be commenced and tried in the accessory real estate mortgage is a personal action. In a personal action,
proper court which has jurisdiction over the area wherein the real property the plaintiff seeks the recovery of personal property, the enforcement of a
involved, or a portion thereof, is situated. contract or the recovery of damages. In contrast, in a real action, the
plaintiff seeks the recovery of real property, or, as indicated in Section 2 (a),
Forcible entry and detainer actions shall be commenced and tried in the Rule 4 of the then Rules of Court, a real action is an action affecting title to
municipal trial court of the municipality or city wherein the real property real property or for the recovery of possession, or for partition, or
involved, or a portion thereof, is situated. condemnation of, or foreclosure of mortgage on, real property.

Section 2. Venue of personal actions. - All other actions may be commenced In the Pascual case, relied upon by petitioner, the contract of sale of the
and tried where the plaintiff or any of the principal plaintiffs resides, or fishpond was assailed as fictitious for lack of consideration. We held that
where the defendant or any of the principal defendants resides, or in the there being no contract to begin with, there is nothing to annul. Hence, we
case of a non-resident defendant where he may be found, at the election of deemed the action for annulment of the said fictitious contract therein as
the plaintiff. one constituting a real action for the recovery of the fishpond subject
thereof
Expounding on the foregoing provisions, the Court delineated the basic distinction
between a real and a personal action and their respective venues in Bank of the
We cannot, however, apply the foregoing doctrine to the instant case. Note
Philippine Islands v. Hontanosas, Jr.,[15] stating that: that in Pascual, title to and possession of the subject fishpond had already
passed to the vendee. There was, therefore, a need to recover the said
The determinants of whether an action is of a real or a personal nature have
fishpond. But in the instant case, ownership of the parcels of land
been fixed by the Rules of Court and relevant jurisprudence. According to
subject of the questioned real estate mortgage was never
Section 1, Rule 4 of the Rules of Court, a real action is one that affects title
transferred to petitioner, but remained with TOPROS. Thus, no real
to or possession of real property, or an interest therein. Such action is to be
action for the recovery of real property is involved. This being the
commenced and tried in the proper court having jurisdiction over the area
case, TOPROS' action for annulment of the contracts of loan and real
wherein the real property involved, or a portion thereof, is situated, which
estate mortgage remains a personal action. (emphasis supplied)
explains why the action is also referred to as a local action. In contrast, the
Rules of Court declares all other actions as personal actions. Such actions
In the Complaint filed with the court a quo, petitioner sought the nullification of the xxxx
Deed of Sale with Right to Repurchase on the strength of this claim: he did not sign the
same nor did he execute any special power of attorney in favor of his late wife to do so 11. Plaintiff before and during the time of the execution of the subject Deed
in his behalf.[18] But, as there was no allegation that the possession and title to of Sale with Right to Repurchase dated 29 March 2011 NEVER MET
the property have been transferred to respondent, nowhere in the Complaint defendant Saigh. It was only sometime in December 7 or 8, 2011 that he
did petitioner allege or pray for the recovery or reconveyance of the real met defendant Saigh during the wake of his wife wherein he was introduced
property. Pertinent parts of the Complaint read thus: to the former by Orly Gabriel.

4. Plaintiff was married to Ma. Lucila B. Racpan on 20 December 1978. The 12. To date, plaintiff is in possession of the subject property. However,
latter died on 13 November 2011 at Oroville, California... his daughter has been receiving text message from defendant requiring him
to settle the said alleged obligation of his deceased wife to her.[19]
5. Plaintiff Racpan purchased a property from his brother Lorezo L. Racpan
formerly covered by Transfer Certificate of Title No. T-189893 and located at Evidently, as the Complaint was not concerned with the title to or recovery of the real
Carmen, Davao del Norte and the said property is now covered by property, it was a personal action. Thus, Davao City, where both the petitioner and
Transfer Certificate of Title No. T-142-2011009374. Hereto attached the respondent reside is the proper venue for the complaint. The appellate court
and marked as Annex "B" is a copy of the Transfer Certificate of Title No. therefore committed a reversible error in affirming the trial court's dismissal of the case
T-142-2011009374 registered under the name of plaintiff Rudy L. for improper venue.
Racpan. Also attached and marked as Annex "C'" is the tax declaration of
the subject property to prove that plaintiff is the owner of the same. The Complaint was exempted from Barangay Conciliation Proceedings

6. Plaintiff's wife died at Oroville, California on 12 November 2011. However, As for petitioner's failure to resort to barangay conciliation, Section 412 of the Local
her remains were returned to Davao City, Philippines. Nonetheless, it was Government Code (LGC) provides that parties may go directly to court where the action
the daughter of the plaintiff in the person of Lani Racpan who arrived first in is coupled with provisional remedies:
Davao City.
SEC. 412. Conciliation. - (a) Pre-condition to filing of complaint in court. -
xxxx No complaint, petition, action, or proceeding involving any matter within the
authority of the lupon shall be filed or instituted directly in court or any
8. On 12 December 2011, plaintiff's daughter showed to him the subject other government office for adjudication, unless there has been a
deed of sale with right to repurchase dated 29 March 2011. Plaintiff was confrontation between the parties before the lupon chairman or the pangkat,
surprised because he did not know or has NO knowledge of the said deed of and that no conciliation or settlement has been reached as certified by the
sale with right to repurchase. When plaintiff navigated the Deed of lupon secretary or pangkat secretary as attested to by the lupon chairman
Sale, he was surprised because his signature appearing on the same or pangkat chairman or unless the settlement has been repudiated by the
is COMPLETELY FALSIFIED.... parties thereto.

8.a Moreover, plaintiff did not also execute any special power of (b) Where parties may go directly to court. - The parties may go directly to
attorney in favour of his deceased wife authoring the latter to [sell] court in the following instances:
the subject property to the defendant.
(1) Where the accused is under detention;
8.b On the other hand, the subject property is registered under the
name of plaintiff Rudy Racpan and NOT TO SPOUSES Racpan. The (2) Where a person has otherwise been deprived of personal liberty calling
words "married to Ma. Lucila B. Racpan" only signified the civil status of for habeas corpus proceedings;
plaintiff to the latter.
(3) Where actions are coupled with provisional remedies such as
xxxx preliminary injunction, attachment, delivery of personal property, and
support pendente lite; and
9.d Evidently, from the foregoing the (alleged) subject deed of sale with
right to repurchase is NULL AND VOID as the same contains the (4) Where the action may otherwise be barred by the statute of limitations.
falsified signature of the herein plaintiff.
(c) Conciliation among members of indigenous cultural communities. - The
 customs and traditions of indigenous cultural communities shall be applied in
settling disputes between members of the cultural communities.

While there is no dispute herein that the present case was never referred to the
Barangay Lupon for conciliation before petitioner instituted Civil Case No. 34, 742-
2012, there is likewise no quibbling that his Complaint was coupled with a prayer for
the issuance of a preliminary injunction.[20] Hence, it falls among the exceptions to the
rule requiring the referral to baranggay conciliation.

As good faith is always presumed,[21] in the absence of proof of improper motive on

WHEREFORE, the petition is GRANTED. The February 13, 2017 Decision and August
17, 2017 Resolution of the Court of Appeals in CA­-G.R. CV No. 04034-MIN, as well as
the Orders dated September 18, 2013 and June 19, 2004 of the Regional Trial Court of
Davao City, Branch 11, in Civil Case No. 34, 742-2012 are REVERSED and SET
ASIDE. Civil Case No. 34, 742-2012 is hereby ordered REINSTATED. The RTC is
ordered to proceed with dispatch in the disposition of the mentioned case.

SO ORDERED.

Bersamin, Leonen, Martires, and Gesmundo, JJ., concur.

July 2, 2018

NOTICE OF JUDGMENT

Sirs / Mesdames:

Please take notice that on June 6, 2018 a Decision, copy attached hereto, was
rendered by the Supreme Court in the above-entitled case, the original of which was
received by this Office on July 2, 2018 at 1:38 p.m.

Very truly yours,

(SGD)
WILFREDO V.
LAPITAN
Division Clerk of
 
Court

[1] Penned by Associate Justice Oscar V. Badelles and concurred in by Associate Justices

Romulo V. Borja and Ronaldo B. Martin, rollo, pp. 48-53.