INCAPABLE OF PECUNIARY ESTIMATION

Cases in which the subject matter is incapable of pecuniary estimation come under the exclusive original jurisdiction of the RTC except when the law provides that these should come under the original jurisdiction of the MTC.

When is a subject matter incapable of pecuniary estimation? When we cannot give a monetary value due to the nature of the case. If a subject matter can be given a monetary value, even if we do not know the value as of now, then it is capable of pecuniary estimation.  

This was explained by the Supreme Court in Alona G. Roldan vs. Spouses Clarence I. Barrios et al, GR No. 214803, April 23, 2018:

The RTC dismissed the foreclosure cases finding that being a real action and the assessed value of the mortgaged property is only ₱13,380.00, it is the first level court which has jurisdiction over the case and not the RTC.

Jurisdiction over the subject matter is the power to hear and determine cases of the general class to which the proceedings in question belong. It is conferred by law and an objection based on this ground cannot be waived by the parties. To determine whether a court has jurisdiction over the subject matter of a case, it is important to determine the nature of the cause of action and of the relief sought.

Batas Pambansa Big. (BP) 129 as amended by Republic Act No. (RA) 7691 pertinently provides for the jurisdiction of the RTC and the first level courts as follows:

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 (₱20,000.00) or, for civil actions in Metro Manila, where such value exceeds Fifty thousand pesos (₱20,000.00) except actions for forcible entry into and unlawful detainer of lands or buildings, original jurisdiction over which is conferred upon the Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts.

and

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:

x x x x

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 (₱20,000.00) or, in civil actions in Metro Manila, where such assessed value does not exceed Fifty thousand pesos (₱50,000.00) 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.

From the foregoing, the RTC exercises exclusive original jurisdiction in civil actions where the subject of the litigation is incapable of pecuniary estimation. It also has jurisdiction in civil cases involving title to, or possession of, real property or any interest in it where the assessed value of the property involved exceeds ₱20,000.00, and if it is below P20,000.00, it is the first level court which has jurisdiction. An action "involving title to real property" means that the plaintiff's cause of action is based on a claim that he owns such property or that he has the legal right to have exclusive control, possession, enjoyment, or disposition of the same.

The allegations and reliefs sought in petitioner's action for foreclosure of mortgage showed that the loan obtained by respondents spouses Barrios from petitioner fell due and they failed to pay such loan which was secured by a mortgage on the property of the respondents spouses; and prayed that in case of default of payment of such mortgage indebtedness to the court, the property be ordered sold to answer for the obligation under the mortgage contract and the accumulated interest. It is worthy to mention that the essence of a contract of mortgage indebtedness is that a property has been identified or set apart from the mass of the property of the debtor-mortgagor as security for the payment of money or the fulfillment of an obligation to answer the amount of indebtedness, in case of default in payment. Foreclosure is but a necessary consequence of non-payment of the mortgage indebtedness. In a real estate mortgage when the principal obligation is not paid when due, the mortgagee has the right to foreclose the mortgage and to have the property seized and sold with the view of applying the proceeds to the payment of the obligation. Therefore, the foreclosure suit is a real action so far as it is against property, and seeks the judicial recognition of a property debt, and an order for the sale of the res.

Petitioner cites Russell v. Vestil to show that action for foreclosure of mortgage is an action incapable of pecuniary estimation and, therefore, within the jurisdiction of the RTC. We are not persuaded. In the Russell case, we held:

In Singson vs. Isabela Sawmill, we had the occasion to rule that:

[I]n determining whether an action is one the subject matter of which is not capable of pecuniary estimation, this Court has adopted the criterion of first ascertaining the nature of the principal action or remedy sought. If it is primarily for the recovery of a sum of money, the claim is considered capable of pecuniary estimation, and whether jurisdiction is in the municipal courts or in the courts of first instance would depend on the amount of the claim. However, where the basic issue is something other than the right to recover a sum of money, where the money claim is purely incidental to, or a consequence of, the principal relief sought, this Court has considered such actions as cases where the subject of the litigation may not be estimated in terms of money, and are cognizable exclusively by courts of first instance (now Regional Trial Courts).

Examples of actions incapable of pecuniary estimation are those for specific performance, support, or foreclosure of mortgage or annulment of judgment; also actions questioning the validity of a mortgage, annulling a deed of sale or conveyance and to recover the price paid and for rescission, which is a counterpart of specific performance.

While actions under Sec. 33(3) of B.P. 129 are also incapable of pecuniary estimation, the law specifically mandates that they are cognizable by the MTC, METC, or MCTC where the assessed value of the real property involved does not exceed ₱20,000.00 in Metro Manila, or ₱50,000.00, if located elsewhere. If the value exceeds ₱20,000.00 or ₱50,000.00 as the case may be, it is the Regional Trial Courts which have jurisdiction under Sec. 19(2). However, the subject matter of the complaint in this case is annulment of a document denominated as "DECLARATION OF HEIRS AND DEED OF CONFIRMATION OF PREVIOUS ORAL PARTITION.

Clearly, the last paragraph clarified that while civil actions which involve title to, or possession of, real property, or any interest therein, are also incapable of pecuniary estimation as it is not for recovery of money, the court's jurisdiction will be determined by the assessed value of the property involved.

WHEREFORE, the petition for certiorari is DISMISSED as we find no grave abuse of discretion committed by the Regional Trial Court, Branch 6, Kalibo, Aklan in dismissing the complaint for lack of jurisdiction.