G.R. No. 97805. September 2, 1992.]NILO H. RAYMUNDO, Petitioner, v. HON. COURT OF APPEALS, Sixteenth Division, Hon. Judge, RTC, Br. 133, Makati, Metro Manila and GALLERIA DE MAGALLANES ASSOCIATION, INC., Respondents.

1. REMEDIAL LAW; REGIONAL TRIAL COURT; JURISDICTION IN CIVIL CASES NOT CAPABLE OF PECUNIARY ESTIMATION. — Private respondent’s complaint is an action to compel the petitioner to remove the illegal and unauthorized installation of glasses at Unit AB-122 of the condominium which is not capable of pecuniary estimation and falls under the exclusive jurisdiction of the Regional Trial Court Section 33 of Batas Pambansa Bilang 129 is not applicable in the instant case, but paragraph (1), Section 19 and paragraph (1), Section 21.

2. ID; ID.; ID.; CRITERION IN DETERMINING WHETHER AN ACTION IS ONE THE SUBJECT MATTER OF WHICH IS NOT CAPABLE OF PECUNIARY ESTIMATION. — A civil action in which the subject of the litigation is incapable of pecuniary estimation has invariably been held to be within the exclusive original jurisdiction of the Regional Trial Courts. "In 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 [now municipal trial courts] or in the courts of first instance [now regional trial courts] 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, or 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]." 3. ID.; PROVISIONAL REMEDIES; WRIT OF MANDATORY INJUNCTION; WHEN AVAILABLE. — A writ for mandatory injunction is a provisional remedy. It is provisional because it constitutes a temporary measure availed of during the pendency of the main action and it is ancillary because it is a mere incident in and is dependent upon the result of the main action.

D E C I S I O N

This is a petition for certiorari and prohibition with restraining order and preliminary injunction to annul and set aside the decision of the Court of Appeals dated March 11, 1991 1 dismissing petitioner’s petition for certiorari and prohibition which assailed the Orders 2 dated June 1, 1990 3 and June 29, 1990 4 of the trial court.

It appears on record that on July 5, 1989, the administrator of the Galleria de Magallanes Condominium discovered that petitioner Nilo Raymundo, who was an owner/occupant of Unit AB-122 of said condominium, made an unauthorized installation of glasses at the balcony of his unit in violation of Article IV, Section 3 paragraph (d) of the Master Deed and Declaration of Restrictions of the Association, which states that:

"d. Nothing shall be done or placed in any unit or in the common areas which is beyond or will impair the structural strength of the buildings or alter the original architecture, appearance and specifications of the building, including the external facade thereof." 5Thereafter, the administrator of said condominium reported said violation to the Board of Directors of the private respondent Galleria de Magallanes Association, Inc. in a special meeting held on July 8, 1989 and the former sent a letter dated July 12, 1989 6 to the petitioner demanding the latter to remove the illegal and unauthorized installation of glasses at his unit.Petitioner refused, consequently, private respondent filed a complaint for mandatory injunction against petitioner on February 21, 1990 with the Regional Trial Court of Makati, Branch 133 in Civil Case No. 90-490.On March 12, 1990, petitioner filed a Motion for extension of time to file an Answer 7 as well as a Motion for production of document 8 which were granted in an Order dated March 16, 1990. 9 However, on March 23, 1990, instead of an Answer, petitioner filed a Motion to Dismiss with the trial court on the ground that said court has no jurisdiction over the present case since a complaint for mandatory injunction is within the exclusive original jurisdiction of the Metropolitan Trial Court.

The Motion to Dismiss was denied in the Order of June 1, 1990, the pertinent portion of which reads: "This is a suit for mandatory injunction. Under Sec. 21 of BP 129, as amended, it is the Regional Trial Court which has the legal competence to issue the same. Corollarily, the second ground must be denied. The action is essentially one which falls within the jurisdiction of the Regional Trial Court.

"WHEREFORE, the Motion to Dismiss is hereby denied, for lack of merit." 10

Likewise, petitioner’s Motion for Reconsideration was denied in the Order of June 29, 1990 which We quote, to wit:

"As denominated in the complaint itself, this is a suit for mandatory injunction, and the nature of the action as designated by the plaintiff is substantiated by the allegations of the complaint itself. Such being the case, Sec. 21 of BP 129 governs. The claims for attorney’s fees is incidental to the nature of the complaint as one of mandatory injunction which is also attested by the prayer in the complaint "to remove the illegal and unauthorized installation of glasses at Unit AB-122 of the Condominium within five (5) days from receipt of the order . . ." and, therefore, does not affect the legal competence of the Court to act on the complaint." 11

On elevation to the appellate court in a petition for certiorari and prohibition with restraining order and preliminary injunction, the petition was again dismissed on March 11, 1991.

Hence, this petition alleging want of jurisdiction of the trial court to hear and decide private respondent’s complaint for mandatory injunction considering that private respondent’s sole pecuniary claim of P10,000.00 as attorney’s fees in Civil Case No. 90-490 is within the original

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and exclusive jurisdiction of the Metropolitan Trial Court as provided for under Section 33 of B.P. 129.

We do not agree.

The contention of the petitioner is devoid of merit because private respondent’s complaint is an action to compel the petitioner to remove the illegal and unauthorized installation of glasses at Unit AB-122 of the condominium which is not capable of pecuniary estimation and falls under the exclusive jurisdiction of the Regional Trial Court Section 33 of Batas Pambansa Bilang 129 is not applicable in the instant case, but paragraph (1), Section 19 and paragraph (1), Section 21 of said law which provide:

"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;" x       x       x

"Sec. 21. Original jurisdiction in other cases. — Regional Trial Courts shall exercise original jurisdiction: (1) In the issuance of writs of certiorari, prohibition, mandamus, quo warranto, habeas corpus and injunction which may be enforced in any part of their respective regions;"

A civil action in which the subject of the litigation is incapable of pecuniary estimation has invariably been held to be within the exclusive original jurisdiction of the Regional Trial Courts.

"In 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 [now municipal trial courts] or in the courts of first instance [now regional trial courts] 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, or 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]." 12

As correctly stated by the Court of Appeals, the question for resolution is whether or not the petitioner violated the provisions of the Master Deed and Declaration of Restriction of the corporation, and if so, to remove the illegal and unauthorized installation of glasses at Unit AB-122 of the Condominium. Clearly, the issue is incapable of pecuniary estimation.

In the instant case. the claim of attorney’s fees by the private respondent in the amount of P10,000.00 is only incidental to its principal cause of action which is for the removal of the illegal and unauthorized installation of the glasses made by the petitioner and therefore, said amount is not determinative of the jurisdiction of the court.

Note should be taken. however, that the trial court had erroneously considered the complaint as one for mandatory injunction, misled perhaps by the caption of the complaint.

A writ for mandatory injunction is a provisional remedy. It is provisional because it constitutes a temporary measure availed of during the pendency of the main action and it is ancillary because it is a mere incident in and is dependent upon the result of the main action.

WHEREFORE, the petition for certiorari and prohibition with restraining order and preliminary injunction is hereby DISMISSED for lack of merit and the decision of the Court of Appeals promulgated on March 11, 1991 is hereby AFFIRMED.

SO ORDERED.

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G.R. No. L-36098 January 21, 1983ORTIGAS & COMPANY, LIMITED PARTNERSHIP, petitioner, vs. JUDGE JOSE B. HERRERA, respondent.

PER CURIAM:

G.R. No. L-36098 (Ortigas & Company, Limited Partnership vs. Judge Jose B. Herrera, City Court of Manila, Branch II, and Emiliano Samson). – On August 14, 1969, petitioner and private respondent entered into an agreement thereby for and in consideration of P55,430.00, the former agreed to sell to the latter a parcel of land with a special condition that should private respondent as purchaser complete the construction including the painting of his residential house on said lot within two (2) years from August 14, 1969, petitioner, as owner, has agreed to refund to private respondent the amount of P10.00 per square meter. When the aforesaid special condition was fulfilled, private respondent, on May 17, 1971 accordingly notified in writing the petitioner of the same and requested for his refund amounting to P4,820.00.

Upon failure of petitioner to pay his obligation, private respondent on May 6, 1972 filed a complaint for sum of money and damages with the City Court of Manila, Branch II, against petitioner docketed as Civil Case No. 211673. A motion to dismiss was filed by petitioner on grounds of lack of jurisdiction, failure of the complaint to state a cause of action and improper avenue. City Court Judge Jose B. Herrera in his order dated June 27, 1972 held in abeyance the resolution on the motion until after the trial of the case on the merits.

A reconsideration of the said order having been denied, petitioner on October 12, 1972 filed with the Court of First Instance of Manila Branch XXVII, a special civil action for certiorari and prohibition with preliminary injunction docketed as Civil Case No. 88510. A motion to dismiss was filed by private respondent, and on November 17, 1972, the petition was dismissed on the ground that the claim of private respondent in his complaint, being less than P10,000.00, is within the exclusive jurisdiction of the city court.

Petitioner thus filed the present petition and argues among others that: (a) as determined from the allegations of the complaint, the action is for specific performance of contract; and (b) actions in which the subject of litigation is not capable of pecuniary estimation such as complaints for specific performance of contract are exclusively cognizable by the Court of First Instance. Hence, the decisive question to be resolved in this present petition is whether or not the City Court of Manila, Branch II, has jurisdiction over the complaint.

The action involved in this case is one for specific performance and not for a sum of money and wherefore incapable of pecuniary estimation because what private respondent seeks is the performance of petitioner's obligation under a written contract to make a refund but under certain specific conditions still to be proven or established. In a case for the recovery of a sum of money, as the collection of a debt, the claim is considered capable of pecuniary estimation (Lapitan vs. Scandia Inc., 24 SCRA 479) because the obligation to pay the debt is not conditioned upon any specific fact or matter. But when a party to a contract has agreed

to refund to the other party a sum of money upon compliance by the latter of certain conditions and only upon compliance therewith may what is legally due him under the written contract be demanded, the action is one not capable of pecuniary estimation. The payment of a sum of money is only incidental which can only be ordered after a determination of certain acts the performance of which being the more basic issue to be inquired into.

Although private respondent's complaint in the court a quo is designated as one for a sum of money and damages, an analysis of all the factual allegations of the complaint patently shows that what private respondent seeks is the performance of petitioner's obligation under the written contract to make the refund of the rate of P10.00 per square meter or in the total amount of P4,820.00, but only after proof of having himself fulfilled the conditions that will give rise to petitioner's obligation, a matter clearly incapable of pecuniary estimation.

In view of the foregoing, the Court RESOLVED to reverse the order appealed from and the complaint filed with the City Court of Manila, Branch II, docketed as Civil Case No. 211673 is hereby ordered dismissed for lack of jurisdiction.

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G.R. No. 72644 December 14, 1987ALFREDO F. PRIMERO, petitioner, vs. INTERMEDIATE APPELLATE COURT and DM TRANSIT, respondents.

The question on which the petitioner's success in the instant appeal depends, and to which he would have us give an affirmative answer, is whether or not, having recovered separation pay by judgment of the Labor Arbiter — which held that he had been fired by respondent DM Transit Corporation without just cause — he may subsequently recover moral damages by action in a regular court, upon the theory that the manner of his dismissal from employment was tortious and therefore his cause of action was intrinsically civil in nature.

Petitioner Primero was discharged from his employment as bus driver of DM Transit Corporation (hereafter, simply DM) in August, 1974 after having been employed therein for over 6 years. The circumstances attendant upon that dismissal are recounted by the Court of Appeals 1 as follows:

Undisputably, since August 1, 1974, appellee's bus dispatcher did not assign any bus to be driven by appellant Primero. No reason or cause was given by the dispatcher to appellant for not assigning a bus to the latter for 23 days (pp. 6-14, 21-22, tsn, May 15, 1979).

Also, for 23 days, appellant was given a run-around from one management official to another, pleading that he be allowed to work as his family was in dire need of money and at the same time inquiring (why) he was not allowed to work or drive a bus of the company. Poor appellant did not only get negative results but was given cold treatment, oftentimes evaded and given confusing information, or ridiculed, humiliated, or sometimes made to wait in the offices of some management personnel of the appellee (pp. 2-29, tsn, May 15, 1979).

(The) General Manager and (the) Vice-President and Treasurer ... wilfully and maliciously made said appellant ... seesaw or ... go back and forth between them for not less than ten (10) times within a period of 23 days ... but (he) got negative results from both corporate officials. Worse, on the 23rd day of  his  ordeal appellant was suddenly told by General Manager Briones to seek employment with other bus companies because he  was  already   dismissed   from his   job  with   appellee   (without   having been) told of the cause of his hasty and capricious dismissal ... (pp. 8, 11-13, 25, tsn, May 15, 1979).

Impelled to face the harsh necessities of life as a jobless person and worried by his immediate need for money, appellant pleaded with Corporate President Demetrio Munoz, Jr. for his reinstatement and also asked P300.00 as financial assistance, but the latter told the former that he (Munoz, Jr.) will not give him even one centavo and that should

appellant sue him in court, then that will be the time President Munoz, Jr. will pay him, if Munoz, Jr. loses the case x x (pp. 21-22, tsn, May 15, 1979).

Appellant also advised (the) President of the oppressive, anti-social and inhumane acts of subordinate officers ... (but) Munoz, Jr. did nothing to resolve appellant's predicament and ... just told the latter to go back ... to ... Briones, who insisted that appellant seek employment with other bus firms in Metro Manila ... (but) admitted that the appellant has not violated any company rule or regulation ... (pp. 23-26, tsn, May 15, 1979).

... In pursuance (of) defendant's determination to oppress plaintiff and cause further loss, irreparable injury, prejudice and damage, (D.M. Transit) in bad faith and with malice persuaded other firms (California Transit, Pascual Lines, De Dios Transit, Negrita Corporation, and MD Transit) not to employ (appellant) in any capacity after he was already unjustly dismissed by said defendant ... (paragraph 8 of plaintiff's complaint).

These companies with whom appellant applied for a job called up the D.M. Transit Office (which) ... told them ... that they should not accept (appellant) because (he) was dismissed from that Office.

Primero instituted proceedings against DM with the Labor Arbiters of the Department of Labor, for illegal dismissal, and for recovery of back wages and reinstatement. It is not clear from the record whether these proceedings consisted of one or two actions separately filed. What is certain is that he withdrew his claims for back wages and reinstatement, "with the end in view of filing a damage suit" "in a civil court which has exclusive jurisdiction over his complaint for damages on causes of action founded on tortious acts, breach of employment contract ... and consequent effects (thereof ). 2

In any case, after due investigation, the Labor Arbiter rendered judgment dated January 24, 1977 ordering DM to pay complainant Primero P2,000.00 as separation pay in accordance with the Termination Pay Law. 3 The judgment was affirmed by the National Labor Relations Commission and later by the Secretary of Labor, the case having been concluded at this level on March 3, 1978. 4

Under the provisions of the Labor Code in force at that time, Labor Arbiters had jurisdiction inter alia over —

1) claims involving non-payment or underpayment of wages, overtime compensation, social security and medicare benefits, and

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2) all other cases or matters arising from employer-employee relations, unless otherwise expressly excluded. 5

And we have since held that under these "broad and comprehensive" terms of the law, Labor Arbiters possessed original jurisdiction over claims for moral and other forms of damages in labor disputes. 6

The jurisdiction of Labor Arbiters over such claims was however removed by PD 1367, effective May 1, 1978, which explicitly provided that "Regional Directors shall not indorse and Labor Arbiters shall not entertain claims for moral or other forms of damages." 7

Some three months afterwards, Primero brought suit against DM in the Court of First Instance of Rizal seeking recovery of damages caused not only by the breach of his employment contract, but also by the oppressive and inhuman, and consequently tortious, acts of his employer and its officers antecedent and subsequent to his dismissal from employment without just cause. 8

While this action was pending in the CFI, the law governing the Labor Arbiters' jurisdiction was once again revised. The amending act was PD 1691, effective May 1, 1980. It eliminated the restrictive clause placed by PD 1367, that Regional Directors shall not indorse and Labor Arbiters entertain claims for moral or other forms of damages. And, as we have had occasion to declare in several cases, it restored the principle that "exclusive and original jurisdiction for damages would once again be vested in labor arbiters;" eliminated "the rather thorny question as to where in labor matters the dividing line is to be drawn between the power lodged in an administrative body and a court;' " and, "in the interest of greater promptness in the disposition of labor matters, ... spared (courts of) the often onerous task of determining what essentially is a factual matter, namely, the damages that may be incurred by either labor or management as a result of disputes or controversies arising from employer-employee relations." 9 Parenthetically, there was still another amendment of the provision in question which, however, has no application to the case at bar. The amendment was embodied in B.P. Blg. 227, effective June 1, 1982. 10

On August 11, 1980 the Trial Court rendered judgment dismissing the complaint on the ground of lack of jurisdiction, for the reason that at the time that the complaint was filed. on August 17, 1978, the law — the Labor Code as amended by PD 1367, eff. May 1, 1978 — conferred exclusive, original jurisdiction over claims for moral or other damages, not on ordinary courts, but on Labor Arbiters.

This judgment was affirmed by the Intermediate Appellate Court, by Decision rendered on June 29, 1984. This is the judgment now subject of the present petition for review on certiorari. The decision was reached by a vote of 3 to 2. The dissenters, placing reliance on certain of our pronouncements, opined that Primero's causes of action were cognizable by the courts, that existence of employment relations was not alone decisive of the issue of jurisdiction, and that such relations may indeed give rise to "civil" as distinguished from purely   labor disputes, as where an employer's right to dismiss his employee is exercised

tortiously, in a manner oppressive to labor, contrary to morals, good customs or public policy. 11

Primero has appealed to us from this judgment of the IAC praying that we overturn the majority view and sustain the dissent.

Going by the literal terms of the law, it would seem clear that at the time that Primero filed his complaints for illegal dismissal and recovery of backwages, etc. with the Labor Arbiter, the latter possessed original and exclusive jurisdiction also over claims for moral and other forms of damages; this, in virtue of Article 265 12 of PD 442, otherwise known as the Labor Code, effective from May 1, 1974. In  other  words,   in   the  proceedings  before   the  Labor Arbiter, Primero plainly had the right to plead and prosecute a claim not only for the reliefs specified by the Labor Code itself for unlawful termination of employment, but also for moral or other damages under the Civil Code  arising from or connected with that termination of employment. And this was the state of the law when he moved for the dismissal of his claims before the Labor Arbiter, for reinstatement and recovery of back wages, so that he might later file a damage suit "in a civil court which has exclusive jurisdiction over his complaint ... founded on tortious acts, breach of employment contract ... and consequent effects (thereof)." 13

The legislative intent appears clear to allow recovery in proceedings before Labor Arbiters of moral and other forms of damages, in all cases or matters arising from employer-employee relations. This would no doubt include, particularly, instances where an employee has been unlawfully dismissed. In such a case the Labor Arbiter has jurisdiction to award to the dismissed employee not only the reliefs specifically provided by labor laws, but also moral and other forms of damages governed by the Civil   Code. Moral damages would be recoverable, for example, where the dismissal of the employee was not only effected without authorized cause and/or due process for which relief is granted by the Labor Code — but was attended by bad faith or fraud, or constituted an act oppressive to labor, or was done in a manner contrary to morals, good customs or public policy 14 — for which the obtainable relief is determined by the Civil   Code 15 (not the Labor Code). Stated otherwise, if the evidence adduced by the employee before the Labor Arbiter should establish that the employer did indeed terminate the employee's services without just cause or without according him due process, the Labor Arbiter's judgment shall be for the employer to reinstate the employee and pay him his back wages or, exceptionally, for the employee simply to receive separation pay. These are reliefs explicitly prescribed by the Labor Code. 16 But any award of moral damages by the Labor Arbiter obviously cannot be based on the Labor Code but should be grounded on the Civil Code. Such an award cannot be justified solely upon the premise (otherwise sufficient for redress under the Labor Code) that the employer fired his employee without just cause or due process. Additional facts must be pleaded and proven to warrant the grant of moral damages under the Civil Code, these being, to repeat, that the act of dismissal was attended by bad faith or fraud, or was oppressive to labor, or done in a manner contrary to morals, good customs, or public policy; and, of course, that social humiliation, wounded feelings, grave anxiety, etc., resulted therefrom. 17

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It is clear that the question of the legality of the act of dismissal is intimately related to the issue of the legality of the manner by which that act of dismissal was performed. But while the Labor Code treats of the nature of, and the remedy available as regards the first — the employee's separation from employment — it does not at all deal with the second — the manner of that separation — which is governed exclusively by the Civil Code. In addressing the first issue, the Labor Arbiter applies the Labor Code; in addressing the second, the Civil Code. And this appears to be the plain and patent intendment of the law. For apart from the reliefs expressly set out in the Labor Code flowing from illegal dismissal from employment, no other damages may be awarded to an illegally dismissed employee other than those specified by the Civil Code. Hence, the fact that the issue-of whether or not moral or other damages were suffered by an employee and in the affirmative, the amount that should properly be awarded to him in the circumstances-is determined under the provisions of the Civil Code and not the Labor Code, obviously was not meant to create a cause of action independent of that for illegal dismissal and thus place the matter beyond the Labor Arbiter's jurisdiction.

Thus, an employee who has been illegally dismissed (i.e., discharged without just cause or being accorded due process), in such a manner as to cause him to suffer moral damages (as determined by the Civil Code), has a cause of action for reinstatement and recovery of back wages and damages. When he institutes proceedings before the Labor Arbiter, he should make a claim for all said reliefs. He cannot, to be sure, be permitted to prosecute his claims piecemeal. He cannot institute proceedings separately and contemporaneously in a court of justice upon the same cause of action or a part thereof. He cannot and should not be allowed to sue in two forums: one, before the Labor Arbiter for reinstatement and recovery of back wages, or for separation pay, upon the theory that his dismissal was illegal; and two, before a court of justice for recovery of moral and other damages, upon the theory that the manner of his dismissal was unduly injurious, or tortious. This is what in procedural law is known as splitting causes of action, engendering multiplicity of actions. It is against such mischiefs that the Labor Code amendments just discussed are evidently directed, and it is such duplicity which the Rules of Court regard as ground for abatement or dismissal of actions, constituting either litis pendentia (auter action pendant) or res adjudicata, as the case may be. 18 But this was precisely what Primero's counsel did. He split Primero's cause of action; and he made one of the split parts the subject of a cause of action before a court of justice. Consequently, the judgment of the Labor Arbiter granting Primero separation pay operated as a bar to his subsequent action for the recovery of damages before the Court of First Instance under the doctrine of res judicata, The rule is that the prior "judgment or order is, with respect to the matter directly adjudged or as to any other matter that could have been raised in relation thereto, conclusive between the parties and their successors in interest by title subsequent to the commencement of the action or special proceeding, litigating for the same thing and under the same title and in the same capacity. 19

We are not unmindful of our previous rulings on the matter cited in the dissent to the decision of the Court of Appeals subject of the instant petition, 20 notably, Quisaba v. Sta Ines-Melale Veneer & Plywood Inc., where a distinction was drawn between the right of the employer to dismiss an employee, which was declared to be within the competence of labor agencies to pass upon, and the "manner in which the right was exercised and the effects

flowing therefrom," declared to be a matter cognizable only by the regular courts because "intrinsically civil." 21 We opine that it is this very distinction which the law has sought to eradicate as being so tenuous and so difficult to observe, 22 and, of course, as herein pointed out, as giving rise to split jurisdiction, or to multiplicity of actions, "a situation obnoxious to the orderly administration of justice. 23 Actually we merely reiterate in this decision the doctrine already laid down in other cases (Garcia v. Martinez, 84 SCRA 577; Ebon v. de Guzman, 13 SCRA 52; Bengzon v. Inciong, 91 SCRA 248; Pepsi-Cola Bottling Co. v. Martinez, 112 SCRA 578; Aguda v. Vallejos, 113 SCRA 69; Getz v. C.A., 116 SCRA 86; Cardinal Industries v. Vallejos, 114 SCRA 471; Sagmit v. Sibulo, 133 SCRA 359) to the effect that the grant of jurisdiction to the Labor Arbiter by Article 217 of the Labor Code is sufficiently comprehensive to include claims for moral and exemplary damages sought to be recovered from an employer by an employee upon the theory of his illegal dismissal. Rulings to the contrary are deemed abandoned or modified accordingly.

WHEREFORE, the petition is DISMISSED, without pronouncement as to costs.

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G.R. No. 70174 February 9, 1993JOSE TIPAIT, SUBSTITUTED BY JOEL S. TIPAIT, MONTANO S. TIPAIT, JOSE S. TIPAIT, HELEN S. TIPAIT, EVELYN S. TIPAIT and BEATRIZ S. TIPAIT, petitioners, vs.HON. JUAN Y. REYES, REGIONAL TRIAL COURT JUDGE, 7th JUDICIAL REGION AND SPOUSES ANGEL C. VELOSO AND MILAGROS ESCANO VELOSO, respondents.

This refers to a petition for certiorari  to annul all orders issued by respondent judge in Civil Case No. R-20975 of the then Court of First Instance (now Regional Trial Court) of Cebu. On March 27, 1985, this Court issued a resolution considering the spouses Angel C. Veloso and Milagros Escano Veloso impleaded as respondents (p. 45, Rollo).

The record reveals the following antecedent facts:

On October 7, 1976, laborers Faustino Garbo, Certerio Garbo, Arcenio Alum, Genaro Requizo, Expedito Armenteros, William Campana, and Ramos Faura filed a complaint (p. 12, Rollo), docketed a TFU Case No. 536 of the Regional Office No. VII of the Department of Labor, Cebu City, for illegal dismissal or reinstatement with backwages, living allowance, and overtime pay against M.E. Veloso Enterprises and/or Milagros Escano Veloso and/or Angel Veloso.

On October 20, 1976, Regional Director Francisco Armado issued an order (Annex E, Petition, pp. 13-14, Rollo) against private respondents and M.E. Veloso Enterprises to reinstate complainants and remunerate them overtime-pay and emergency allowance.

Private respondents and M.E. Veloso Enterprises filed a motion for reconsideration (Annex F, Petition, pp. 15-18, Rollo) of the order of October 20, 1976. On December 6, 1976, the Regional Director issued an order (Annex G, Petition, p. 19, Rollo) setting aside the order of October 20, 1976 and reopening the case for the reception of additional evidence.

After the parties had submitted their evidence, the Regional Director issued an order dated February 3, 1977 (Annex H, Petition, pp. 20-22, Rollo) reiterating his previous order directing respondents therein to reinstate the complainants and to pay them overtime pay and emergency allowance. Respondents appealed to the Minister of Labor. On October 18, 1979, the Minister of Labor rendered a decision (Annex C, Petition, pp. 9-11, Rollo) dismissing the appeal. Private respondents filed a motion for reconsideration which was denied by the Minister of Labor in an order dated July 1, 1981. A second motion for reconsideration was filed by private respondents and said second motion for reconsideration was denied by the Deputy Minister, by authority of the Minister, in an order dated January 25, 1985 (Annex 3, Private Respondents' Comment, p. 71, Rollo). In said order the Deputy Minister directed the issuance of a writ of execution.

Private respondents appealed to the Office of the President. On August 18, 1985, Presidential Assistant for Legal Affairs Manuel Lazaro, by authority of the President, issued an order denying the appeal (p. 108, Rollo).

In the meantime, on August 18, 1981, the Office of the Minister of Labor remanded the record of the case to the Regional Director for execution and/or appropriate action (Answer of Regional Director, Annex J of Petition. p. 34, Rollo). On September 18, 1981, the Regional Director issued a writ of execution (Annex B, Petition, p. 8, Rollo) and a notice of auction sale was issued by the Provincial Sheriff involving 4 parcels of land with improvements (Annex 6, Respondents' Comment, pp. 74-75, Rollo). At the auction sale, the highest bidder was petitioner herein who paid the amount of P100,000.00 to the Deputy Sheriff and the latter issued a certificate of sale dated December 19, 1981 (Annex A, Respondents' Comment, pp. 83-84, Rollo).

On September 28, 1981, private respondents filed a complaint docketed as Civil Case No. R-20975 of the Court of First Instance of Cebu (Annex I of Petition, pp. 23-30, Rollo) for prohibition, praying that the Provincial Sheriff or his deputies be restrained from enforcing or implementing the writ of execution issued in TFU Case No. 536 and that said writ of execution be annulled. On June 11, 1982, respondent judge issued an order (Annex A of Petition, pp. 6-7, Rollo) nullifying the public auction sale and the Certificate of Sale.

Hence, petitioner (now substituted by his heirs, Resolution of March 8, 1989, p. 171, Rollo) filed the present petition, contending that respondent court has no jurisdiction over Civil Case No. R-20975.

The petition is impressed with merit.

It is readily apparent that respondent court has no jurisdiction over Civil Case No. R-20975 whose subject-matter is an incident of a labor case. Actually, said civil case is in the nature of a motion to quash the writ of execution issued in TFU Case No. 536, a labor case over which the Regional Director of the Department of Labor has original and exclusive jurisdiction (Article 217, Labor Code of the Philippines, as amended, Policy Instructions No. 6 of the Minister of Labor). This Court in a similar case held:

A perusal of the petition for damages and prohibition filed by Saulog Transit, Inc. in the lower court reveals that basically, what was being questioned was the legality or propriety of the alias writ of execution dated March 1, 1985, as well as the acts performed by the Ministry officials in implementing the same. In other words, the petition was actually in the nature of a motion to quash the writ; and with respect to the acts of the Ministry officials, a case growing out of a labor dispute, as the acts complained of, were perpetrated during the execution of a decision of the then Minister of Labor and Employment. However characterized, jurisdiction over the petition pertains to the Labor Ministry, now Department and not the regular courts. This conclusion is evident, not only from the provisions of Article 224 [b] of the Labor Code, but also of Article 218, as amended by Batas Pambansa Blg. 227 in connection with Article 255 of the same Code. (Pucan vs. Bengzon, 155 SCRA 692, 699 [1987]).

Page 7 of 16

The proper remedy that private respondents should have taken, instead of instituting Civil Case No. R-20975, was to file the necessary petition or motion before the Secretary of Labor who has the power and authority to take any measure under existing laws to ensure compliance with the decisions, orders and awards of the Department of Labor. Despite the finality of the decision of the Regional Director, the Secretary of Labor retains control over its execution and implementation (Pucan vs. Bengzon, supra).

WHEREFORE, respondent court is hereby ordered to DISMISS Civil Case No. R-20975 for lack of jurisdiction and all orders previously issued therein are hereby ANNULLED and SET ASIDE.

Costs against private respondents.

SO ORDERED.

Page 8 of 16

G.R. No. 92598 May 20, 1994PURIFICACION Y. MANLIGUEZ, ANTONINA Y. LUIS and BENJAMIN C. YBANEZ, petitioners, vs. THE COURT OF APPEALS, ET AL., respondents.

This is an appeal by certiorari from the Decision of the Court of Appeals, 1 dated November 16, 1989, denying due course to and dismissing the petition in CA-G.R. SP NO. 18017. 2

The case at bench finds its roots in the Decision of the Department of Labor and Employment (Region VII), ordering Inductocast Cebu, a partnership based in Mandaue City, to pay its former employees a total of P232,908.00. As a consequence of the judgment, the labor department's regional sheriff levied the buildings and improvements standing on Lot 109, Plan 11-5121-Amd., at Tipolo, Mandaue City. The levied properties (hereinafter referred to as the "Tipolo properties") were subsequently sold at public auction to said employees.

On May 25, 1988, petitioners filed with the RTC of Cebu City, 7th Judicial Branch, a Complaint 3 which sought the lifting of the levy over, and annulment of the sale of, the Tipolo properties. The Complaint was docketed as Civil Case No. Ceb-6917, and raffled to Branch 8 of the trial court. Petitioners therein alleged that: they are the owners of the Lot 109; they entered into a lease agreement with Inductocast Cebu over Lot 109; the lease contract provided that, except for machineries and equipment, all improvements introduced in the leased premises shall automatically be owned by the Lessor (petitioners) upon the expiration/termination of the contract; 4 the lease agreement was terminated by petitioners in November, 1980 due to non-payment of rentals by Inductocast Cebu; 5 thereafter, petitioners took actual possession of and occupied the Tipolo properties. Petitioners likewise alleged in their Complaint that they became aware of the labor dispute involving Inductocast only after the impugned public auction sale. 6

Atty. Danilo Pilapil, claiming to be the John Doe named in the Complaint, filed a motion to dismiss on the ground that the trial court had no jurisdiction over the case. The buyers of the Tipolo properties, as intervenors, also filed a motion to dismiss on the same ground. Both motions, which were opposed by petitioners, were denied.

The intervenors, however, moved for reconsideration of the denial. In an Order dated April 18, 1989, the trial court granted the motion and dismissed Civil Case No. Ceb-6917. It held that the civil case "is actually in the nature of a quashal of the levy and the certificate of sale, a case arising out of a dispute that was instituted by the previous employees of Inductocast before the Department of Labor and Employment, Region 7." 7 Citing Pucan vs. Bengzon, 155 SCRA 692 (1987), it held it had no jurisdiction over the case since the levy and sale "are connected with the case within the exclusive jurisdiction of the Department of Labor and Employment." 8

Petitioners questioned the dismissal of their Complaint to the respondent Court of Appeals, through a petition for certiorari and preliminary injunction. 9 The appellate court, in its impugned Decision, denied the petition as it held:

To Our minds, the issue on what forum the case must be tried or heard is a settled one. The Department of Labor is the agency upon which devolves the jurisdiction over disputes emanating from and in relation with labor controversies to the exclusion of the regular courts.

The issue in the case at bar concerns the levy of a property in pursuance to a writ of execution, arising out of labor disputes. There can be no doubt that jurisdiction pertains to the Department of Labor.

xxx xxx xxx

In the light of the factual antecedents and incidents that transpired in the hearing of this case at bar, the (trial court) correctly ruled that indeed the Department of Labor has jurisdiction over the case. Consequently, WE see no abuse of discretion let alone a grave one, amounting to lack or in excess of its jurisdiction correctible with a writ of certiorari.

Indeed, the issue of granting or denying a motion to dismiss is addressed to the sound discretion of the court, and in the absence of a capricious and whimsical exercise of power, certiorari will not lie.

Thus, this appeal where petitioners contend:

THE RESPONDENT APPELLATE COURT ERRED IN HOLDING THAT THE DEPARTMENT OF LABOR HAS JURISDICTION ON THE SUBJECT MATTER AND NATURE OF THE CASE AS AGAINST THE CIVIL COURT.

We find merit in the appeal. Firstly, respondent court erred in holding that the trial court does not have jurisdiction over the case filed by petitioners. It is at once evident that the Civil Case No. Ceb-6917 is not a labor case. No employer-employee relationship exists between petitioners and the other parties, and no issue is involved which may be resolved by reference to the Labor Code, other labor statutes, or any collective bargaining agreement. Neither can we characterize petitioner's action before the trial court as arising out of a labor dispute. It was not brought to reverse or modify the judgment of the Department of Labor and Employment (DOLE). Neither did it question the validity of, or pray for, the quashal of the writ of execution against Inductocast.

What is to be litigated in Civil Case No. Ceb-6917 is the issue of ownership over the Tipolo properties. Clearly, it is the RTC and not the labor department which can take cognizance of the case, as provided by B.P. Blg. 129 ("An Act Reorganizing the Judiciary, Appropriating Funds Therefor, and For Other Purposes"), thus:

Page 9 of 16

Sec. 19. Jurisdiction in civil  case. — Regional Trial Courts shall exercise exclusive original jurisdiction:

xxx xxx xxx

(2) In all civil actions which involve the title to, or possession of real property, or any interest therein, except actions for forcible entry into and unlawful detainer of lands or buildings, original jurisdiction over which is conferred upon Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts;

xxx xxx xxx

The action taken by petitioners before the RTC asserting their ownership over the levied properties is mandated by Section 17, Rule 39 of the Revised Rules of Court. Time and again, we have held that:

Under Section 17, Rule 39, a third person who claims property levied upon on execution may vindicate such claim by action. . . . The right of a person who claims to be the owner of property levied upon on execution to file a third-party claim with the sheriff is not exclusive, and he may file an action to vindicate his claim even if the judgment creditor files an indemnity bond in favor of the sheriff to answer for any damages that may be suffered by the third-party claimant. By "action", as stated in the Rule, what is meant is a separate and independent action. 10

Secondly, it is incorrect to argue that the trial court cannot take cognizance of Civil Case No. Ceb-6917 without interfering with the writ of attachment and writ of execution of a co-equal body. It is settled that the levy and sale of property by virtue of a writ of attachment is lawful only when the levied property indubitably belongs to the defendant. If property other than those of the defendant is attached and sold by the sheriff, he acts beyond the limits of his and the court's authority. 11 In this regard, we held in the case of Uy, Jr. vs. Court of Appeals, 191 SCRA 275 (1991) that:

The main issue in this case is whether or not properties levied and seized by virtue of a writ of attachment and later by a writ of execution, were under custodia   legis and therefore not subject to the jurisdiction of another co-equal court where a third party claimant claimed ownership of the same properties.

The issue has long been laid to rest in the case of Manila   Herald Publishing Co., Inc. v. Ramos (88 Phil. 94 [1951]) where the Court ruled that while it is true that property in custody of the law may not be interfered with, without the permission of the proper court, this rule is

confined to cases where the property belongs to the defendant or one in which the defendant has proprietary interests. But when the Sheriff, acting beyond the bounds of his office seizes a stranger's property, the rule does not apply and interference with his custody is not interference with another court's order of attachment.

Also, in the more recent case of Santos vs. Bayhon, 199 SCRA 525 (1991), we stated, viz.:

The general rule that no court has the power to interfere by injunction with the judgments or decrees of another court with concurrent or coordinate jurisdiction possessing equal power to grant injunctive relief, applies only when no third-party claimant is involved. . . . When a third party, or stranger to the action, asserts a claim over the property levied upon, the claimant may vindicate his claim by an independent action in the proper civil court which may stop the execution of the judgment on property not belonging to the judgment debtor (Citations omitted.)

Finally, it must be noted that the Pucan case relied upon by respondent court is inapplicable to the case at bench which involves a third-party claim over property levied on execution. In Pucan, we enjoined the Regional Trial Court from acting on the petition for damages and prohibition against the enforcement of the writ of execution issued by the NCR director of the then Ministry of Labor and Employment in a labor case for the following reason:

A perusal of the petition for damages and prohibition filed by Saulog Transit, Inc., in the lower court reveals that basically, what was being questioned was the legality or propriety of the alias writ of execution dated March 1, 1985, as well as the acts performed by the Ministry officials in implementing the same. In other words, the petition was actually in the nature of a motion to quash the writ; and with respect to the acts of the Ministry officials, a case growing out of a labor dispute, as the acts complained of, were perpetrated during the execution of a decision of the then Minister of Labor and Employment. However characterized, jurisdiction over the petition pertains to the Labor Ministry, now Department and not the regular courts. This conclusion is evident, not only from the provisions of Article 224(b) of the Labor Code, but also of Article 218, as amended by Batas Pambansa Blg. 227 in connection with Article 255 of the same Code.

xxx xxx xxx

Apparently, Saulog Transit, Inc. was misled by its own prayer for actual, moral and exemplary damages. It believed that such additional cause of action could clothe the petition with the mantle of a regular action cognizable by the regular courts. It was, of course, mistaken for the fact

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remains that the acts complained of are mere incidents of a labor dispute. Such prayer therefore did not alter the complexion of the case as one arising from a labor dispute, but was subsumed by the nature of the main case, over which the regular courts had no jurisdiction, much less the power to issue a temporary or permanent injunction or restraining order. . . . 12

In fine, we prohibited the action before the trial court in Pucan because it attacked the regularity of the issuance of the alias writ of execution in the labor case, which is but an incident of the labor dispute. This is not so in the case at bench where the civil case filed by petitioners does not even collaterally attack the validity of the DOLE's writ of attachment. On the contrary, petitioners in Civil Case No. Ceb-6917 pray for the trial court's ruling that the DOLE's judgment could not be validly executed on the Tipolo properties, which allegedly do not belong to Inductocast.

IN VIEW WHEREOF, the petition for review is GRANTED. The Decision of the Court of Appeals in CA-G.R. SP No. 18017, dated November 16, 1989, is REVERSED and SET ASIDE. The Regional Trial Court of Cebu City, Branch 8 is ordered to try Civil Case Ceb-6917 on its merit. No costs.

SO ORDERED.

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G.R. No. L-71959 November 28, 1985TRADE UNIONS OF THE PHILIPPINES & ALLIED SERVICES LOCAL CHAPTER NO. 1158 (SUPER GARMENTS MANUFACTURING CORPORATION WORKERS UNION), petitioner, vs.HON. JOSE L. COSCOLLUELA JR., PRESIDING JUDGE OF BRANCH CXLVI REGIONAL TRIAL COURT OF MAKATI AND RUSTAN COMMERCIAL CORPORATION, respondents.

The petition seeks to enjoin the public respondent from further proceeding in Civil Case No. 10905 of the Regional Trial Court of Makati, Metro Manila. Upon the filing of the petition this Court issued a temporary restraining order and required the private respondent to comment.

Petitioner union filed a notice of strike with the Ministry of Labor and Employment against Super Garments Manufacturing Corporation on May 12, 1985. The strike commenced on June 8, 1985 and is said to be still on.

Super Garments and Rustan Commercial Corporation have separate compartments in the same building at Malugay and streets It is called the Yupangco building.

It is alleged by the petitioner union that goods of Super Garments were spirited out of its strike-bound premises thru Rustan's warehouse. Whereupon, the union picketed not only Super Garments but also Rustan. As a result Rustan filed Civil Case No. 10905 before the respondent judge for injunction and damages thru the PECABAR law office and petition No. 971 with the National Labor Relations Commission also to enjoin the union from picketing its premises. The petition was filed by another counsel, Atty. Armando B. Ampil.

In Civil Case No. 10905, the respondent judge issued an order on June 21, 1985 setting "the hearing of theapplication for a writ of preliminary injuction on June 27, 1985 at 2:00 o'clock in the afternoon." On July 15, 1985, the respondent judge issued the writ after finding no employer-employee relationship between the parties. This order prompted the petitioner union to come to this Court for the purpose aforesaid.

In the meantime, petitioner union on July 12, 1985, filed a complaint for unfair labor practice against both Super Garments and Rustan alleging that the former is but the manufacturing arm of the latter.

Petitioner union claims that respondent judge has no jurisdiction to issue an injunction because the case is a labor dispute; that the prerogative belongs to the Minister of Labor and Employment. Upon the other hand, private respondent Rustan says that the respondent judge has jurisdiction because there is no labor dispute between it and the union even as it went to the National Labor Relation Commission to seek Identical relief.

At this stage there appears to be no labor dispute between the petitioner and the private respondent for which reason the latter was justified in seeking relief in respondent judge's court. ihe unfair labor complaint filed by petitioner union on Page 304 July 12, 1985 does not

prove a labor relationship. By the same token it was improper for the private respondent to have filed Case No. 971 with the National Labor Relations Commission.

In the light of the foregoing, the petition is dismissed for lack of merit and the temporary restraining order issued on September 23, 1985 is hereby lifted. However, private respondent Rustan Commercial Corporation is directed to withdraw its case before the National Labor Relations Commission. No costs.

SO ORDERED,

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G.R. No. L-53837 October 3, 1991FELIX PAINAGA, petitioner, vs.HON. NOLI MA. CORTES, COURT OF FIRST INSTANCE OF ANTIQUE (BRANCH I) and VENANCIO V. MOSTACHO, respondents.

The proper application of the doctrine of exhaustion of administrative remedies is the issue presented in the instant petition for review on certiorari.

On December 29, 1962, petitioner purchased from Bonifacio Merendad a parcel of corn and pasture land with improvements thereon situated at Sitio Igbolo, Barangay Cabiawan, San Remigio, Antique with an area of 60,000 square meters more or less. He has since then been in possession thereof.

On or about April 21, 1977, private respondent, claiming that the northern portion of said parcel of land is included in his Original Certificate of Title No. N-1889 (Free Patent No. 319059), caused a technical survey of said portion over the vehement opposition and objection of petitioner. Petitioner thereafter filed with the District Officer, Bureau of Lands, San Jose, Antique a protest under oath, praying that the original certificate of title issued in private respondent's favor be annulled on the ground of fraud. An investigation was forthwith commenced by the District Land Officer.

In the meantime, on September 20, 1978, petitioner filed before the then Court of First Instance (now Regional Trial Court) of Capiz an action for Injunction with Preliminary Prohibitory Injunction with Damages against

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private respondent,docketed therein as Civil Case No. 1539. He alleged in the main that since he filed the protest with the District Land Office, private respondent, personally and with the aid of his agents who are notorious in the community for their violent temper, had for several times attempted and were still attempting to oust him from the area in controversy by means of force, violence and intimidation. He therefore prayed that a writ of preliminary prohibitive injunction be issued against private respondent as defendant therein and his agents; that said injunctive writ be made permanent after trial and that private respondents be adjudged liable to him for actual and moral damages and expenses of litigation. 1

After hearing the parties' arguments on the application of a writ of preliminary prohibitive injunction, the trial court issued an order dated December 17, 1978 denying said application but setting the main case for hearing on January 9, 1979. 2

At the hearing, counsel for private respondent moved for the dismissal of the case, to which counsel for petitioner responded with a request to be allowed to file a memorandum in opposition said motion. The memorandum was seasonably filed.

On January 22, 1979, the trial court issued an Order dismissing Civil Case No. 1539 on the ground of prematurity. It held that the action for injunction is in effect an action for nullity of OCT No. 1889 which was allegedly obtained by private respondent through fraud. However, since it was admitted by petitioner that he had filed a protest with the Bureau of Lands, which protest was still pending investigation, petitioner had "no cause of action for filing a complaint in court unless the administrative remedies provided by law shall have been exhausted." In support of its ruling, it cited the pronouncement in the then recent decision in Pestanas vs. Dyogi, G.R. No. L-25786, February 27, 1978, 81 SCRA 574, that where a party seeks a cancellation of a free patent with the Bureau of Lands, he must first pursue his action in the proper Department and a review by the Courts will not be permitted unless the administrative remedies shall have been exhausted. 3

Hence, the petition at bar.

We grant the petition. The court a quo misapplied the rule on exhaustion of administrative remedies. This misapplication stemmed primarily from its characterization of petitioner's action as one for annulment of private respondent's original certificate of title which included the area in dispute. Since a protest aimed precisely at this relief had been previously filed by petitioner in the Bureau of Lands District Office, the trial court readily concluded that the action in court was premature, following the pronouncement in Pestanas vs. Dyogi, supra.

A reading of the complaint in Civil Case No. 1539 however shows that the same is, as its caption states, an original action for injunction brought to protect and preserve petitioner's right of possession over the subject land in accordance with the provision of the New Civil Code which recognizes a possessor's right to be respected in his possession, thus:

Art. 539. Every possessor has a right to be respected in his possession; and should he be disturbed therein he shall be protected in or restored to said possession by the means established by the laws and the Rules of Court.

In the very recent case of Maximo Solis, et al. vs. Hon. Intermediate Appellate Court, et al., G.R. No. 72486, June 19, 1991, this Court ruled that the "power and authority given to the Director of Lands to alienate and dispose of public lands does not divest the regular courts of their jurisdiction over possessory actions instituted by occupants or applicants against others to protect their respective possessions and occupations. While the jurisdiction of the Bureau of Lands is confined to the determination of the respective rights of rival claimants to public lands or to cases which involve disposition of public lands, the power to determine who has the actual, physical possession or occupation or the better right of possession over public lands remains with the courts."

The rationale for this ruling was given, thus:

The rationale is evident. The Bureau of Lands does not have the wherewithal to police public lands. Neither does it have the means to prevent disorders or breaches of peace among the occupants. Its power is clearly limited to disposition and alienation and while it may decide

Page 13 of 16

disputes over possession, this is but in aid of making the proper awards. The ultimate power to resolve conflicts of possession is recognized to be within the legal competence of the civil courts and its purpose is to extend protection to the actual possessors and occupants with a view to quell social unrest.

The protest filed by petitioner before the Bureau of Lands seeking the cancellation of private respondent's original certificate of title on the ground of fraud differs from Civil Case No. 1549 in terms of their nature, the causes of action upon which they rest as well as in the reliefs sought. The administrative protest boils down to the question of ownership of the area in controversy, while the court action is concerned merely with possession. That ownership and possession are two entirely different legal concepts is illustrated in the case of German Management Services, Inc. vs. Court of Appeals, 4 in this wise:

... It must be stated that regardless of the actual condition of the title to the property, the party in peaceable quiet possession shall not be turned out by a strong hand, violence or terror. Thus, a party who can prove prior possession can recover (or retain) such possession even against the owner himself. Whatever may be the character of his prior possession, if he had in his favor priority in time, he has the security that entitles him to remain on the property until he is lawfully ejected by a person having a better light by accion publiciana or accion reivindicatoria.

Whatever decision the trial court may render in Civil Case No. 1539 will not encroach on the primary jurisdiction of the Bureau of Lands over the question of who between petitioner and private respondent is entitled to the ownership of the land in question. Thus, the principle of exhaustion of administrative remedies does not find application in the case at bar.

Indeed, the case at bar is easily distinguishable from Pestanas vs. Dyogi, supra, so heavily relied upon by the trial court. There is no doubt that the principle of exhaustion of administrative remedies obtained in that case as the plaintiffs-appellants therein, after filing with the Bureau of Lands a petition for cancellation of free patent No. V-166124 issued to Josefa Dyogi, filed with the Court of First Instance of Quezon a complaint to have the identical free patent No. V-166124 declared null and void, praying that they be declared the owners of the portions of land possessed by them and/or that they be declared as having the preferential right to acquire the said land. In the case at bar, the action in court brought by petitioner did not seek that the title of private respondent be annulled, which issue was already before the administrative agency, but merely asked that petitioner be respected in his prior possession of the piece of land in controversy.

WHEREFORE, the instant petition is hereby GRANTED. The order dated January 22, 1979 is annulled and set aside. Civil Case No. 1539 of the former Court of First Instance of Antique is reinstated. The successor Regional Trial Court is directed to proceed with the disposition of the case with deliberate dispatch.

SO ORDERED.

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G.R. No. L-25786 February 27, 1978LUCIANO PESTANAS, ANGEL PESTANAS, JOSE PESTANAS, ELISEO PESTANAS, EXEQUIEL PAGADORA, LUCIANA TORRES, SOLOMON TENA, and FELIX ATENTAR, plaintiffs-appellants, vs.JOSEFA DYOGI, JOAQUIN LACORTE, the Director of Lands, and the Secretary of Agriculture and Natural Resources, defendants-appellees.

This is an appeal, filed on December 7, 1965, from an order of the Court of First Instance of Quezon, dismissing the plaintiffs-appeallants' complaint in Civil Case No. 598 on the ground of non-exhaustion of administrative remedies.

It appears that in 1929, Severo Ungriano took possession of a parcel of land consisting of thirty (30) hectares located at Barrio Libo, Panukulan, Quezon. He cleared and cultivated the holding and introduced improvements thereon. Subsequently, he filed Homestead Application No. 145134 (E-86406) for a 24-hectare property, which application was approved by the Director of Lands. 1

In 1942 and on various dates subsequent thereto, Ungriano transfered his right to possess the aforementioned parcel of land to the herein plaintiffs-appeallants. These transferees continued to clear and cultivate the land and to introduce improvements over the portions respectively occupied by them. The holding, however, was forest land, being part of Timberland Block B. LC Project No. 19-C Polillo, Quezon, per BF Map LC 2066. 2 Therefore, to perfect their titles over th land, plaintiffs-appllants made representations with the authorities for the release of the same from the Forest Zone. One of the persons they approached was then President of the

Senate, Eulogio Rodriguez Sr., who, upon teaming of the situation, wrote the then Director of the Bureau of Forestry, Felipe Amos, and requested the latter "to find ways and means for the immediate release of this land so that the present occupants thereof could perfect their titles over the said land." 3

The land was finally released from the Forest Zone sometime in May, 1958: 4 On October 5, 1959 plaintiffs-appellants were advised by the Director of Lands, to file appropriate public land applications and to have the land surveyed so that their claims thereto may be perfected. 5

Meanwhile, and prior to its release from the Forest Zone, the land in controversy was part of a timber concession held by defendant-appellee Josefa Dyogi by virtue of an Ordinary Timber License (O.T. Lic. No. 84- '55) granted to her in 1950. 6 At the instance of defendant-appellee Josefa Dyogi, a criminal information was filed on May 29, 1958 against three of the herein appellants — namely, Exequiel Pagadora, Luciano and Angel Pestanas - for unlawful possession and destruction of public forest before the Justice of the Peace Court of Polillo, Quezon. On November 29, 1958, the three accused appellants were convicted and sentenced to suffer one (1) month imprisonment, but on appeal to the Court of First Instance, all the cases against them were dismissed. 7 Josefa Dyogi nevertheless did not cease in her attempt

to have the ownership of the 24-hectare lot in controversy declared in her name. She filed with the Bureau of Lands Free Patent Application No. 8-2103 covering the portions occupied by the appellants. The Director of Lands approved said free patent application on the strength of the report submitted by public lands inspector Joaquin Lacorte, one of the defendants, to the effect that the land was free from claims and conflicts, and that there was no person occupying or claiming the land other than Josefa Dyogi. 8 On March 20, 1961, free patent No. V-166123 was issued to Josefa Dyogi by the Secretary of Agriculture and Natural Resources. 9

On September 13, 1961, plaintiffs-appellants filed with the Bureau of Lands a petition for cancellation of free patent No. V-166123 issued to Josefa Dyogi.

On March 17, 1962, or six months thereafter, while the foregoing petition for cancellation was pending investigation by the Bureau of Lands 10 they filed a complaint in the Court of First Instance of Quezon, to have the Identical free patent No. V-166123 declared null and void and prayed that they be declared the owners of the portions of land possesed by them and/or that they be declared as having the preferential right to acquire the said land. The complaint alleged, among other things:

xxx xxx xxx 11. That defendant Josefa Dyogi filed with the Bureau of Lands Free Patent Application No. 8-2103 covering the portions of land occupied and possessed by plaintiffs, but in filing the said free patent application, the said Josefa Dyogi acted in bad faith and committed fraud, deceit and misrepresentations by alleging that she is a Filipino citizen, when in truth and in fact, she is a Chinese citizen who is disqualffied to own public agricultural lands and by further alleging that the land is not claimed and occupied by any other person.

12. That defendant Joaquin Lacorte, a public lands inspector with official station at Lucena City, in connivance with his codefendant Josefa Dyogi, submitted a false report of investigation making it appear in said report that he conducted an ocular investigation of the land, that the land was occupying from claiming and conflicts; that there was no person occupying or claiming the land other than the applicant-defendant Josefa Dyogi and that defendant Josefa Dyogi has complied with all the requirements of the law regarding residence and cultivation of the land, which facts are absolutely false and untrue.

Defendants, now appellees, moved to dismiss the complaint on the following grounds: (1) that the complaint states no cause of action, and (2) that the filing thereof was premature, because of the pendency of the administrative case for cancellation of free patent No. V-166123. 11

Plaintiffs-appellants answered that their complaint states sufficient cause of action and that exhaustion of administrative remedies is not necessary "Since the Department of Agriculture

Page 15 of 16

and Natural Resources has not acted on the Petition of the plaintiffs for cancellation of the said Free Patent 'title, notwithstanding the lapse of a period of more than one year from the date it was flied ... 12

Defendant-appellee Dyogi filed a Rejoinder wherein she reiterated the need to exhaust all administrative remedies in this case. 13

The lower court sustained the defendants' contentions. By an order dated June 21, 1963, it dismissed the complaint as to Lacorte on the ground that he "has no personality in this case and that there is no cause of action against him. 14 After hearing defendant Dyogi's motion to dismiss," 15 the lower court granted it and by an order dated March 29, 1965, dismissed plaintiff 's complaint. Said order reads in part:

A careful perusal of the record of the case and basing on the arguments of the parties during the oral argument it has been satisfactorily proved and established that the plaintiff, as stated above has filed with the Director of Lands, a petition for the cancellation of the free patent issued in favor of the defendant Josefa A. Dyogi over the land in question and that the case is still pending before the Director of Lands. This being so, the plaintiffs have to wait for the outcome of said case and should the decision be adverse to the plaintiffs, they still have the right to appeal to the Secretary of Agriculture and Natural Resources and to the President of the Philippines. Until these administrative shall have been exhausted by the plaintiffs, the filing of the instant case with the court is rather premature because there can be no cause of action for filing the complaint unless the administrative remedies provided for by law shall have been exhausted. 16

On April 30, 1965, the plaintiffs-appellants filed a motion for reconsideration 17 which was denied by the lower court by an order dated September 9, 1965 because said motion was "without merits. 18 Hence this appeal, on the following assignment of errors:

1. THAT THE COURT ERRED IN DISMISSING PLAINTIFFS COMPLAINT.

2. THAT THE TRIAL COURT ERRED IN DECLARING THAT PLAINTIFFS HAVE TO WAIT FOR THE OUTCOME OF PETITION THEY FILED WITH THE BUREAU OF LANDS FOR CANCELLATION OF THE CERTIFICATE OF TITLE NO. V-166123 BEFORE TAKING THIS CASE TO COURT.

3. THAT THE TRIAL COURT ERRED IN DECLARING THAT PLAINTIFFS HAVE NO CAUSE OF ACTION UNTIL THEY 'EXHAUSTED THE ADMINISTRATIVE REMEDIES IN THE INSTANT CASE. 19

The three errors assigned actually raise one issue only, i.e. whether or not the lower court properly applied the doctrine of exhaustion of administrative remedies. As aptly put by the appellee, the "sole issue in this case involves a purely legal question which may be stated

briefly as follows: Whether or not a party, aggrieved by a decision of the Director of Lands, may file an action in court for the cancellation of a free patent granted under the provisions of the Public Land Jaw (Commonwealth Act No. 141) without waiting for the outcome of a petition previously filed with the Director of Lands praying for the same relief. 20

This appeal is clearly without merit. The order of dismissal — on the grounds of lack of cause of action and non-exhaustion of administrative remedy, and the order denying the motion for reconsideration thereof, are in order. It is now well-settled that where a party seeks for the cancellation of a free patent with the Bureau of Lands, he must pursue his action in the proper Department and a review by the Courts will not be permitted unless the administrative remedies are first exhausted. 21 Thus We held that:

... plaintiff has not exhausted the administrative remedies available to him. Indeed, he seeks in effect, a review of the decision of the Director of Lands in causing a patent to be issued to defendant Avila. Yet, plaintiff does not appear to have asked the Director of Lands to reconsider said decision, or to have appealed therefrom to the Secretary of Agriculture and Natural Resources, who controls said official and is the 'officer charged with out the provision of our revised public land law (CA 141, Sec. 3). It is well settled that, before the decisions or administrative bodies can be brought to courts for review, all administrative remedies must first be exhausted, especially in dispute concerning public lands, where the findings of said administrative bodies as to questions of fact, are declared by statute to be conclusive. 22

The doctrine of exhaustion of administrative remedies applicable to judicial review of decisions of the Director of Lands and the Secretary of Agriculture and Natural Resources is too wen known and need not be restated. 23

The doctrine of exhaustion of administrative remedies applies with greater force in this case since the Bureau of Lands has not yet — as of the time of this appeal — even rendered a decision on the matter.

There is merit also in the lower court's finding that the plaintiffs-appellants have no cause of action. For it is also a settled rule in this jurisdiction that there can be no cause of action for filing a complaint in court unless the administrative remedies provided for by law shag have been exhausted. 24

Wherefore, the order of the lower court dismissing the plaintiffs-appellants' complaint is hereby AFFIRMED, with costs against the appellants.

SO ORDERED.

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