Posted by: Ocace Dave R. Maramara on July 26, 2018
FACTS:
Respondent (Cullen) purchased from Meridien Land Holding,Inc. (MLHI) condominium Unit No. 1201 of the petitioner. Old title was later cancelled and new title (CCT 64218) was issued in respondent's name. On 19 September 2002, petitioner (MPMCC) demanded from Cullen payment for unpaid association dues and assessments claiming a carry-over of MLHI. Cullen refused claiming they are being religiously paid. Consequently, Cullen was prevented from exercising his right to vote and be voted during election of MPMCC's BOD. When MLHI clarified that his dues had already been settled and upon MPMCC's failure to explain why is such, he filed a Complaint for Damages against MPMCC in RTC Makati, acting as a regular court. MPMCC and MLHI moved to dismiss mainly on the ground of lack of jurisdiction. On 9 September 2009, the RTC dismissed the complaint on the ground that the action falls within the exclusive jurisdiction of HLURB and that the issues raised are intra-corporate between the corporation and member. On appeal, the CA reversed RTC decision holding that the controversy is an ordinary civil action for damages within the jurisdiction of regular courts. When motions for reconsideration was denied, petitioners filed the present petition for review on certiorari under Rule 45.
ISSUE:
Whether or not the case falls within RTC sitting as a special commercial court or an ordinary action for damages within the jurisdiction of regular courts.
HELD:
FACTS:
Respondent (Cullen) purchased from Meridien Land Holding,Inc. (MLHI) condominium Unit No. 1201 of the petitioner. Old title was later cancelled and new title (CCT 64218) was issued in respondent's name. On 19 September 2002, petitioner (MPMCC) demanded from Cullen payment for unpaid association dues and assessments claiming a carry-over of MLHI. Cullen refused claiming they are being religiously paid. Consequently, Cullen was prevented from exercising his right to vote and be voted during election of MPMCC's BOD. When MLHI clarified that his dues had already been settled and upon MPMCC's failure to explain why is such, he filed a Complaint for Damages against MPMCC in RTC Makati, acting as a regular court. MPMCC and MLHI moved to dismiss mainly on the ground of lack of jurisdiction. On 9 September 2009, the RTC dismissed the complaint on the ground that the action falls within the exclusive jurisdiction of HLURB and that the issues raised are intra-corporate between the corporation and member. On appeal, the CA reversed RTC decision holding that the controversy is an ordinary civil action for damages within the jurisdiction of regular courts. When motions for reconsideration was denied, petitioners filed the present petition for review on certiorari under Rule 45.
ISSUE:
Whether or not the case falls within RTC sitting as a special commercial court or an ordinary action for damages within the jurisdiction of regular courts.
HELD:
The petition is meritorious.
It is a settled rule that jurisdiction over the subject matter is determined by the allegations in the complaint. It is not affected by the pleas or the theories set up by the defendant in an answer or a motion to dismiss. Otherwise, jurisdiction would become dependent almost entirely upon the whims of the defendant. Also illuminating is the Court's pronouncement in Go v. Distinction Properties Development and Construction, Inc.:
Basic as a hornbook principle is that jurisdiction over the subject matter of a case is conferred by law and determined by the allegations in the complaint which comprise a concise statement of the ultimate facts constituting the plaintiff's cause of action. The nature of an action, as well as which court or body has jurisdiction over it, is determined based on the allegations contained in the complaint of the plaintiff, irrespective of whether or not the plaintiff is entitled to recover upon all or some of the claims asserted therein. The averments in the complaint and the character of the relief sought are the ones to be consulted. Once vested by the allegations in the complaint, jurisdiction also remains vested irrespective of whether or not the plaintiff is entitled to recover upon all or some of the claims asserted therein.
In determining whether a dispute constitutes an intra-corporate controversy, the Court uses two tests, namely, the relationship test and the nature of the controversy test.
An intra-corporate controversy is one which pertains to any of the following relationships: (1) between the corporation, partnership or association and the public; (2) between the corporation, partnership or association and the State insofar as its franchise, permit or license to operate is concerned; (3) between the corporation, partnership or association and its stockholders, partners, members or officers; and (4) among the stockholders, partners or associates themselves. Thus, under the relationship test, the existence of any of the above intra-corporate relations makes the case intra-corporate.2
Under the nature of the controversy test, "the controversy must not only be rooted in the existence of an intra-corporate relationship, but must as well pertain to the enforcement of the parties' correlative rights and obligations under the Corporation Code and the internal and intra-corporate regulatory rules of the corporation." In other words, jurisdiction should be determined by considering both the relationship of the parties as well as the nature of the question involved.
Applying the two tests, we find and so hold that the case involves intra-corporate controversy. It obviously arose from the intra-corporate relations between the parties, and the questions involved pertain to their rights and obligations under the Corporation Code and matters relating to the regulation of the corporation.
It is a settled rule that jurisdiction over the subject matter is determined by the allegations in the complaint. It is not affected by the pleas or the theories set up by the defendant in an answer or a motion to dismiss. Otherwise, jurisdiction would become dependent almost entirely upon the whims of the defendant. Also illuminating is the Court's pronouncement in Go v. Distinction Properties Development and Construction, Inc.:
Basic as a hornbook principle is that jurisdiction over the subject matter of a case is conferred by law and determined by the allegations in the complaint which comprise a concise statement of the ultimate facts constituting the plaintiff's cause of action. The nature of an action, as well as which court or body has jurisdiction over it, is determined based on the allegations contained in the complaint of the plaintiff, irrespective of whether or not the plaintiff is entitled to recover upon all or some of the claims asserted therein. The averments in the complaint and the character of the relief sought are the ones to be consulted. Once vested by the allegations in the complaint, jurisdiction also remains vested irrespective of whether or not the plaintiff is entitled to recover upon all or some of the claims asserted therein.
In determining whether a dispute constitutes an intra-corporate controversy, the Court uses two tests, namely, the relationship test and the nature of the controversy test.
An intra-corporate controversy is one which pertains to any of the following relationships: (1) between the corporation, partnership or association and the public; (2) between the corporation, partnership or association and the State insofar as its franchise, permit or license to operate is concerned; (3) between the corporation, partnership or association and its stockholders, partners, members or officers; and (4) among the stockholders, partners or associates themselves. Thus, under the relationship test, the existence of any of the above intra-corporate relations makes the case intra-corporate.2
Under the nature of the controversy test, "the controversy must not only be rooted in the existence of an intra-corporate relationship, but must as well pertain to the enforcement of the parties' correlative rights and obligations under the Corporation Code and the internal and intra-corporate regulatory rules of the corporation." In other words, jurisdiction should be determined by considering both the relationship of the parties as well as the nature of the question involved.
Applying the two tests, we find and so hold that the case involves intra-corporate controversy. It obviously arose from the intra-corporate relations between the parties, and the questions involved pertain to their rights and obligations under the Corporation Code and matters relating to the regulation of the corporation.
