FIRST DIVISION

[G.R. No. 146089. December 13, 2001.]

VIRGINIA GOCHAN, LOUISE GOCHAN, LAPU-LAPU REAL ESTATE

CORPORATION, FELIX GOCHAN AND SONS REALTY CORPORATION,
MACTAN REALTY DEVELOPMENT CORPORATION , petitioners, vs .
MERCEDES GOCHAN, ALFREDO GOCHAN, ANGELINA GOCHAN-
HERNAEZ, MA. MERCED GOCHAN GOROSPE, CRISPO GOCHAN, JR.,
and MARLON GOCHAN , respondents.

Soo Gutierrez Leogardo & Lee for petitioners.

Zosa & Quijano Law Offices for respondents.

SYNOPSIS

On April 23, 1998, respondents led a complaint against petitioners for speci c
performance and damages with the Regional Trial Court of Cebu City. In their answers,
petitioners raised as a rmative defenses: lack of jurisdiction by the trial court for non-
payment of the correct docket fees, unenforceability of the obligation pursuant to the
Statute of Frauds, extinguishment of the obligation by payment, non-joinder of
indispensable parties and waiver, abandonment and renunciation by respondent of all their
claims against petitioners. Subsequently, petitioners led with the trial court a motion for a
preliminary hearing on the a rmative defenses. The trial court denied the said motion.
Petitioners led a petition for certiorari before the Court of Appeals, but it was dismissed
by the appellate court. Hence, petitioners filed the instant petition.
The Court ruled that the trial court has the discretion to conduct a preliminary
hearing on a rmative defenses. In the case at bar, the trial court committed a grave abuse
of discretion when it denied the motion for preliminary hearing. Some of the defenses
which petitioners invoked as grounds for the dismissal of the action appeared to be
indubitable, contrary to the pronouncement of the trial court. Indeed, the abuse of
discretion it committed amounted to an evasion of positive duty or virtual refusal to
perform a duty enjoined by law, or to act at all in contemplation of law, which would have
warranted the extraordinary writ of certiorari. Hence, the Court of Appeals erred when it
dismissed the petition for certiorari filed by petitioners. HEDCAS

SYLLABUS

1. REMEDIAL LAW; CIVIL PROCEDURE; JURISDICTION; ACQUIRED BY TRIAL

COURT ONLY UPON PAYMENT OF THE PRESCRIBED DOCKET FEES. — The rule is well-
settled that the court acquires jurisdiction over any case only upon the payment of the
prescribed docket fees. In the case of Sun Insurance O ce, Ltd. (SIOL) v. Asuncion , this
Court held that it is not simply the ling of the complaint or appropriate initiatory pleading,
but the payment of the prescribed docket fee that vests a trial court with jurisdiction over
the subject matter or nature of the action.
2. ID.; ID.; CAUSE OF ACTION; DETERMINED BY THE ALLEGATIONS IN THE
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 BODY OF THE COMPLAINT RATHER THAN BY ITS TITLE OR HEADING. — It is necessary to
determine the true nature of the complaint in order to resolve the issue of whether or not
respondents paid the correct amount of docket fees therefor. In this jurisdiction, the
dictum adhered to is that the nature of an action is determined by the allegations in the
body of the pleading or complaint itself, rather than by its title or heading. The caption of
the complaint below was denominated as one for "speci c performance and damages."
The relief sought, however, is the conveyance or transfer of real property, or ultimately, the
execution of deeds of conveyance in their favor of the real properties enumerated in the
provisional memorandum of agreement. Under these circumstances, the case below was
actually a real action, affecting as it does title to or possession of real property.
3. ID.; ID.; REAL ACTION; DEFINED. — In the case of Hernandez v. Rural Bank of
Lucena, this Court held that a real action is one where the plaintiff seeks the recovery of
real property or, as indicated in Section 2(a) of Rule 4 (now Section 1, Rule 4 of the 1997
Rules of Civil Procedure), a real action is an action affecting title to or recovery of
possession of real property.
4. ID.; ID.; ID.; MUST BE FILED IN THE COURT WHERE THE PROPERTY IS
LOCATED. — It has also been held that where a complaint is entitled as one for speci c
performance but nonetheless prays for the issuance of a deed of sale for a parcel of land,
its primary objective and nature is one to recover the parcel of land itself and, thus, is
deemed a real action. In such a case, the action must be led in the proper court where the
property is located[.]
5. ID.; ID.; PAYMENT OF DOCKET FEES; BASIS FOR DETERMINING AMOUNT
THEREOF SHALL BE THE ASSESSED VALUE OR ESTIMATED VALUE OF THE PROPERTY. —
In the case at bar, therefore, the complaint led with the trial court was in the nature of a
real action, although ostensibly denominated as one for speci c performance.
Consequently, the basis for determining the correct docket fees shall be the assessed
value of the property, or the estimated value thereof as alleged by the claimant. jur2005

6. ID.; ID.; ID.; LIBERAL INTERPRETATION OF THE RULES THEREON WILL NOT
APPLY TO RESPONDENTS AS THEY NEVER DEMONSTRATED ANY WILLINGNESS TO
ABIDE BY IT; CASE AT BAR. — We are not unmindful of our pronouncement in the case of
Sun Insurance, to the effect that in case the ling of the initiatory pleading is not
accompanied by payment of the docket fee, the court may allow payment of the fee within
a reasonable time but in no case beyond the applicable prescriptive period. However, the
liberal interpretation of the rules relating to the payment of docket fees as applied in the
case of Sun Insurance cannot apply to the instant case as respondents have never
demonstrated any willingness to abide by the rules and to pay the correct docket fees.
Instead, respondents have stubbornly insisted that the case they led was one for speci c
performance and damages and that they actually paid the correct docket fees therefor at
the time of the filing of the complaint.
7. ID.; ID.; FORUM-SHOPPING; ELUCIDATED. — The deplorable practice of
forum-shopping is resorted to by litigants who, for the purpose of obtaining the same
relief, resort to two different fora to increase his or her chances of obtaining a favorable
judgment in either one.
8. ID.; ID.; ID.; TEST TO DETERMINE THE EXISTENCE THEREOF. — [W]e do not
nd that there is forum-shopping in the case at bar. The rst petition, docketed as CA-G.R.
SP. No. 49084, which is now the subject of the instant petition, involved the propriety of
the a rmative defenses relied upon by petitioners in Civil Case No. CEB-21854. The
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 second petition, docketed as CA-G.R. SP No. 54985, raised the issue of whether or not
public respondent Judge Dicdican was guilty of manifest partiality warranting his inhibition
from further hearing Civil Case No. CEB-21854. More importantly, the two petitions did not
seek the same relief from the Court of Appeals. In CA G.R. No. 49084, petitioners prayed,
among others, for the annulment of the orders of the trial court denying their motion for
preliminary hearing on the a rmative defenses in Civil Case No. CEB-21854. No such
reliefs are involved in the second petition, where petitioners merely prayed for the issuance
of an order enjoining public respondent Judge Dicdican from further trying the case and to
assign a new judge in his stead.
9. ID.; ID.; ID.; NOT PRESENT IN CASE AT BAR. — [W]e do not nd that there is
forum-shopping in the case at bar. The rst petition, docketed as CA-G.R. SP. No. 49084,
which is now the subject of the instant petition, involved the propriety of the a rmative
defenses relied upon by petitioners in Civil Case No. CEB-21854. The second petition,
docketed as CA-G.R. SP No. 54985, raised the issue of whether or not public respondent
Judge Dicdican was guilty of manifest partiality warranting his inhibition from further
hearing Civil Case No. CEB-21854. More importantly, the two petitions did not seek the
same relief from the Court of Appeals. In CA-G.R. SP. No. 49084, petitioners prayed,
among others, for the annulment of the orders of the trial court denying their motion for
preliminary hearing on the a rmative defenses in Civil Case No. CEB-21854. No such
reliefs are involved in the second petition, where petitioners merely prayed for the issuance
of an order enjoining public responder Judge Dicdican from further trying the case and to
assign a new judge in his stead. cADSCT

10. ID; SPECIAL CIVIL ACTIONS; CERTIORARI; TRIAL COURT COMMITTED A

GRAVE ABUSE OF DISCRETION WHEN IT DENIED THE MOTION FOR PRELIMINARY
HEARING OF AFFIRMATIVE DEFENSES WHICH ARE INDUBITABLE. — True, the trial court
has the discretion to conduct a preliminary hearing on a rmative defenses. In the case at
bar, however, the trial court committed a grave abuse of its discretion when it denied the
motion for preliminary hearing. As we have discussed above, some of these defenses,
which petitioners invoked as grounds for the dismissal of the action, appeared to be
indubitable, contrary to the pronouncement of the trial court. Indeed, the abuse of
discretion it committed amounted to an evasion of positive duty or virtual refusal to
perform a duty enjoined by law, or to act at all in contemplation of law, which would have
warranted the extraordinary writ of certiorari. Hence, the Court of Appeals erred when it
dismissed the petition for certiorari filed by petitioners.
DAVIDE, JR., C.J., dissenting opinion:
1. REMEDIAL LAW; CIVIL PROCEDURE; LEGAL FEES; NON-PAYMENT OF THE
DEFICIENCY OF THE DOCKET FEES; SUN LIFE INSURANCE OFFICE LTD. v. ASUNCION
APPLICABLE IN CASE AT BAR. — I seriously doubt the propriety of this action, even if it is
principally based on the non-payment of the de ciency of the docket fee. Sun Life
Insurance Office Ltd. v. Asuncion (170 SCRA 274 [1989]) is not the final word on deficiency
of docket fees. Tacay v. Regional Trial Court of Tagum, Davao del Norte , (180 SCRA 433,
443 [1989]) further liberalized the rule . . . Even if we would still cling to Sun Life, the rule
therein laid down would still be applicable to this case, contrary to the assertion in the
ponencia in question. The evil contemplated in Manchester case which prompted the
pronouncement therein does not exist in the instant case. Verily, there is good faith on the
part of the private respondents in insisting on what their cause of action is. Even the Court
of Appeals sustained their position in this issue. Therefor, private respondents should only
be required to pay the deficiency in docket fees.
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 2. ID.; SPECIAL CIVIL ACTIONS; CERTIORARI; TRIAL COURT DID NOT COMMIT
GRAVE ABUSE OF DISCRETION IN DENYING THE MOTION FOR A PRELIMINARY HEARING
ON THE AFFIRMATIVE DEFENSES. — The order of the trial court denying the motion is an
interlocutory order. There can be no appeal from such order of denial. A special civil action
of certiorari under Rule 65 of the Rules of Court may be resorted to, but there must be a
clear showing that the court had acted without or in excess of jurisdiction or with grave
abuse of discretion amounting to lack of or in excess of jurisdiction. Grave abuse of
discretion means arbitrary and despotic action. I submit that the trial court did not commit
any grave abuse of discretion in denying the motion for a preliminary hearing on the
a rmative defenses on the ground that such defenses do not appear to be indubitable.
The ponencia itself admits that only some of the defenses appeared indubitable. . . .
Accordingly, since the orders of the trial court are not tainted with grave abuse of
discretion, the Court of Appeals committed no error in dismissing the petition for certiorari
against said orders. DHSACT

DECISION

YNARES-SANTIAGO , J : p

This is a petition for review seeking to set aside the decision of the Court of Appeals
dated September 10, 1999 in CA-G.R. SP No. 49084, 1 as well as its Resolution 2 dated
November 22, 2000, denying the Motion for Reconsideration.
Respondents were stockholders of the Felix Gochan and Sons Realty Corporation
and the Mactan Realty Development Corporation. Sometime in 1996, respondents offered
to sell their shares in the two corporations to the individual petitioners, the heirs of the late
Ambassador Esteban Gochan, for and in consideration of the sum of P200,000,000:00.
Petitioners accepted and paid the said amount to respondents. Accordingly, respondents
issued to petitioners the necessary "Receipts." 3 In addition, respondents executed their
respective "Release, Waiver and Quitclaim," 4 wherein .they undertook that they would not
initiate any suit, action or complaint against petitioners for whatever reason or purpose.
In turn, respondents, through Crispo Gochan, Jr., required individual petitioners to
execute a "promissory note," 5 undertaking not to divulge the actual consideration they paid
for the shares of stock. For this purpose, Crispo Gochan, Jr. drafted a document entitled
"promissory note" in his own handwriting and had the same signed by Felix Gochan, III,
Louise Gochan and Esteban Gochan, Jr.
Unbeknown to petitioners, Crispo Gochan, Jr. inserted in the "promissory note" a
phrase that says, "Said amount is in partial consideration of the sale." 6
On April 3, 1998, respondents led a complaint against petitioners for speci c
performance and damages with the Regional Trial Court of Cebu City, Branch 11, docketed
as Civil Case No. CEB-21854. Respondents alleged that sometime in November 1996,
petitioner Louise Gochan, on behalf of all the petitioners, offered to buy their shares of
stock, consisting of 254 shares in the Felix Gochan and Sons Realty Corporation and 1,624
shares of stock in the Mactan Realty Development Corporation; and that they executed a
Provisional Memorandum of Agreement, wherein they enumerated the following as
consideration for the sale:

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 1. Pesos: Two Hundred Million Pesos (P200M)
2. Two (2) hectares more or less of the fishpond in Gochan Compound,
Mabolo, Lot 4F-2-B
3. Lot 2, Block 9 with an area of 999 square meters in Gochan
Compound, Mabolo, Cebu
4. Three Thousand (3,000) square meters of Villas Magallanes in
Mactan, Cebu
5. Lot 423 New Gem Building with an area of 605 square meters. 7
Accordingly, respondents claimed that they are entitled to the conveyance of the
aforementioned properties, in addition to the amount of P200,000,000.00, which they
acknowledge to have received from petitioners. Further, respondents prayed for moral
damages of P15,000,000.00, exemplary damages of P2,000,000.00, attorney's fees of
P14,000,000.00, and litigation expenses of P2,000,000.00.
Petitioners led their answer, raising the following a rmative defenses: (a) lack of
jurisdiction by the trial court for non-payment of the correct docket fees; (b)
unenforceability of the obligation to convey real properties due to lack of a written
memorandum thereof, pursuant to the Statute of Frauds; (c) extinguishment of the
obligation by payment; (d) waiver, abandonment and renunciation by respondent of all their
claims against petitioners; and (e) non-joinder of indispensable parties.
On August 7, 1998, petitioners led with the trial court a motion for a preliminary
hearing on the a rmative defenses. In an Order dated August 11, 1998, the trial court
denied the motion, ruling as follows:
As the grant of said motion lies in the discretion of the court under Section
6 of Rule 16 of the 1997 Rules of Civil Procedure, this Court in the exercise of its
discretion, hereby denies the said motion because the matters sought to be
preliminarily heard do not appear to be tenable. For one, the statute of frauds
does not apply in this case because the contract which is the subject matter of
this case is already an executed contract. The statute of frauds applies only to
executory contracts. According to Dr. Arturo M. Tolentino, a leading authority in
civil law, since the statute of frauds was enacted for the purpose of preventing
frauds, it should not be made the instrument to further them. Thus, where one
party has performed his obligation under a contract, equity would agree that all
evidence should be admitted to prove the alleged agreement (PNB vs. Philippine
Vegetable Oil Company, 49 Phil. 897). For another, the contention of the
defendants that the claims of the plaintiffs are already extinguished by full
payment thereof does not appear to be indubitable because the plaintiffs denied
under oath the due execution and genuineness of the receipts which are attached
as Annexes 1-A, 1-B and 1-C of defendants' answer. This issue therefore has to be
determined on the basis of preponderance of evidence to be adduced by both
parties. Then, still for another, the contention that the complaint is defective
because it allegedly has failed to implead indispensable parties appears to be
wanting in merit because the parties to the memorandum of agreement adverted
to in the complaint are all parties in this case. Then the matter of payment of
docketing and ling fees is not a fatal issue in this case because the record
shows that the plaintiffs had paid at least P165,000.00 plus in the form of ling
and docketing fees. Finally, regarding exerting earnest efforts toward a
compromise by the plaintiffs, the defendants cannot say that there is an absence
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 of an allegation to this effect in the complaint because paragraph 11 of the
complaint precisely states that "before ling this case, earnest efforts toward a
compromise have been made."

Petitioners' motion for reconsideration of the above Order was denied by the trial
court on September 11, 1998.
Petitioners thus led a petition for certiorari with the Court of Appeals, docketed as
CA-G.R. SP No. 49084. On September 10, 1999, the Court of Appeals rendered the
appealed decision dismissing the petition on the ground that respondent court did not
commit grave abuse of discretion, tantamount to lack or in excess of jurisdiction in
denying the motion to hear the affirmative defenses. 8
Again, petitioners led a motion for reconsideration, but the same was denied by the
Court of Appeals in its assailed Resolution of November 22, 2000. 9
Petitioners, thus, brought the present petition for review anchored on the following
grounds:
I.
THE COURT OF APPEALS COMMITTED GRAVE AND PALPABLE
ERROR IN FINDING THAT THE CORRECT DOCKET FEES HAVE BEEN
PAID.
II.
THE COURT OF APPEALS COMMITTED SERIOUS ERROR IN RULING
THAT THE PMOA WAS A PARTIALLY EXECUTED CONTRACT AND
HENCE NOT COVERED BY THE STATUTE OF FRAUDS.
III.
THE COURT OF APPEALS COMMITTED GRAVE ERROR IN DECIDING
THAT THE CLAIMS OF PRIVATE RESPONDENTS HAVE NOT BEEN
EXTINGUISHED BY PAYMENT OR FULL SETTLEMENT DESPITE THE
PRESENCE OF RECEIPTS SIGNED BY THE PRIVATE RESPONDENTS
SHOWING THE CONTRARY.
IV.
THE COURT OF APPEALS COMMITTED GRAVE ERROR IN RESOLVING
THAT FELIX GOCHAN III AND ESTEBAN GOCHAN, JR. ARE NOT
INDISPENSABLE PARTIES AND THEREFORE NEED NOT BE
IMPLEADED AS PARTIES. 1 0
Respondents led their Comment, 1 1 arguing, in ne, that petitioners are guilty of
forum-shopping when they led two petitions for certiorari with the Court of Appeals; and
that the Court of Appeals did not err in dismissing the petition for certiorari.
The instant petition has merit.
The rule is well-settled that the court acquires jurisdiction over any case only upon
the payment of the prescribed docket fees. In the case of Sun Insurance O ce, Ltd. (SIOL)
v. Asuncion, 1 2 this Court held that it is not simply the ling of the complaint or appropriate
initiatory pleading, but the payment of the prescribed docket fee that vests a trial court
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 with jurisdiction over the subject matter or nature of the action.
Respondents maintain that they paid the correct docket fees in the amount of
P165,000.00 when they led the complaint with the trial court. Petitioners, on the other
hand, contend that the complaint is in the nature of a real action which affects title to real
properties; hence, respondents should have alleged therein the value of the real properties
which shall be the basis for the assessment of the correct docket fees.
The Court of Appeals found that the complaint was one for speci c performance
and incapable of pecuniary estimation. We do not agree.
It is necessary to determine the true nature of the complaint in order to resolve the
issue of whether or not respondents paid the correct amount of docket fees therefor. In
this jurisdiction, the dictum adhered to is that the nature of an action is determined by the
allegations in the body of the pleading or complaint itself, rather than by its title or heading.
1 3 The caption of the complaint below was denominated as one for "speci c performance
and damages." The relief sought, however, is the conveyance or transfer of real property, or
ultimately, the execution of deeds of conveyance in their favor of the real properties
enumerated in the provisional memorandum of agreement. Under these circumstances,
the case below was actually a real action, affecting as it does title to or possession of real
property.
In the case of Hernandez v. Rural Bank of Lucena , 1 4 this Court held that a real action
is one where the plaintiff seeks the recovery of real property or, as indicated in section 2(a)
of Rule 4 (now Section 1, Rule 4 of the 1997 Rules of Civil Procedure), a real action is an
action affecting title to or recovery of possession of real property.
It has also been held that where a complaint is entitled as one for speci c
performance but nonetheless prays for the issuance of a deed of sale for a parcel of land,
its primary objective and nature is one to recover the parcel of land itself and, thus, is
deemed a real action. In such a case, the action must be led in the proper court where the
property is located:
In this Court, the appellant insists that her action is one for speci c
performance, and, therefore, personal and transitory in nature.
This very issue was considered and decided by this Court in the case of
Manuel B. Ruiz vs. J.M. Tuason & Co ., Inc. et al., L-18692, promulgated 31
January 1963. There the Court, by unanimous vote of all the Justices, held as
follows:
'This contention has no merit. Although appellant's complaint is
entitled to be one for specific performance, yet the fact that he asked that a
deed of sale of a parcel of land situated in Quezon City be issued in his
favor and that a transfer certi cate of title covering said parcel of land be
issued to him shows that the primary objective and nature of the action is
to recover the parcel of land itself because to execute in favor of appellant
the conveyance requested there is need to make a nding that he is the
owner of the land which in the last analysis resolves itself into an issue of
ownership. Hence, the action must be commenced in the province where
the property is situated pursuant to Section 3, Rule 5, of the Rules of Court,
which provides that actions affecting title to or recovery of possession of
real property shall be commenced and tried in the province where the
property or any part thereof lies." 1 5
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 In the case at bar, therefore, the complaint led with the trial court was in the nature
of a real action, although ostensibly denominated as one for speci c performance.
Consequently, the basis for determining the correct docket fees shall be the assessed
value of the property, or the estimated value thereof as alleged by the claimant. Rule 141,
Section 7, of the Rules of Court, as amended by A.M. No. 00-2-01-SC, provides:
Section 7. Clerks of Regional Trial Courts. — . . .
(b) xxx xxx xxx
In a real action, the assessed value of the property, or if there is none, the
estimated value thereof shall be alleged by the claimant and shall be the basis in
computing the fees.

We are not unmindful of our pronouncement in the case of Sun Insurance, 1 6 to the
effect that in case the ling of the initiatory pleading is not accompanied by payment of
the docket fee, the court may allow payment of the fee within a reasonable time but in no
case beyond the applicable prescriptive period. However, the liberal interpretation of the
rules relating to the payment of docket fees as applied in the case of Sun Insurance cannot
apply to the instant case as respondents have never demonstrated any willingness to
abide by the rules and to pay the correct docket fees. Instead, respondents have
stubbornly insisted that the case they led was one for speci c performance and
damages and that they actually paid the correct docket fees therefor at the time of the
filing of the complaint. Thus, it was stated in the case of Sun Insurance: 1 7
The principle in Manchester could very well be applied in the present case.
The pattern and the intent to defraud the government of the docket fee due it is
obvious not only in the ling of the original complaint but also in the ling of the
second amended complaint.
However, in Manchester, petitioner did not pay any additional docket fee
until the case was decided by this Court on May 7, 1987. Thus, in Manchester, due
to the fraud committed on the government, this Court held that the court a quo did
not acquire jurisdiction over the case and that the amended complaint could not
have been admitted inasmuch as the original complaint was null and void.
In the present case, a more liberal interpretation of the rules is called for
considering that, unlike Manchester, private respondent demonstrated his
willingness to abide by the rules by paying the additional docket fees as required.
The promulgation of the decision in Manchester must have had that sobering
in uence on private respondent who thus paid the additional docket fee as
ordered by the respondent court. It triggered his change of stance by manifesting
his willingness to pay such additional docket fee as may be ordered.

Respondents accuse petitioners of forum-shopping when they led two petitions

before the Court of Appeals. Petitioners, on the other hand, contend that there was no
forum-shopping as there was no identity of issues or identity of reliefs sought in the two
petitions.
We agree with petitioners that they are not guilty of forum-shopping. The deplorable
practice of forum-shopping is resorted to by litigants who, for the purpose of obtaining the
same relief, resort to two different fora to increase his or her chances of obtaining a
favorable judgment in either one. In the case of Golangco v. Court of Appeals, 1 8 we laid
down the following test to determine whether there is forum-shopping:

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 Ultimately, what is truly important to consider in determining whether
forum-shopping exists or not is the vexation caused the courts and the parties-
litigant by a person who asks different courts and/or administrative agencies to
rule on the same or related causes and/or grant the same or substantially the
same reliefs, in the process creating the possibility of con icting decisions being
rendered by the different fora upon the same issues.
In sum, two different orders were questioned, two distinct causes of action
and issues were raised, and two objectives were sought; thus, forum shopping
cannot be said to exist in the case at bar.

Likewise, we do not nd that there is forum-shopping in the case at bar. The rst
petition, docketed as CA-G.R. SP. No. 49084, which is now the subject of the instant
petition, involved the propriety of the affirmative defenses relied upon by petitioners in Civil
Case No. CEB-21854. The second petition, docketed as CA-G.R. SP No. 54985, raised the
issue of whether or not public respondent Judge Dicdican was guilty of manifest partiality
warranting his inhibition from further hearing Civil Case No. CEB-21854.
More importantly, the two petitions did not seek the same relief from the Court of
Appeals. In CA-G.R. SP. No. 49084, petitioners prayed, among others, for the annulment of
the orders of the trial court denying their motion for preliminary hearing on the a rmative
defenses in Civil Case No. CEB-21854. No such reliefs are involved in the second petition,
where petitioners merely prayed for the issuance of an order enjoining public respondent
Judge Dicdican from further trying the case and to assign a new judge in his stead.
True, the trial court has the discretion to conduct a preliminary hearing on
a rmative defenses. In the case at bar, however, the trial court committed a grave abuse
of its discretion when it denied the motion for preliminary hearing. As we have discussed
above, some of these defenses, which petitioners invoked as grounds for the dismissal of
the action, appeared to be indubitable, contrary to the pronouncement of the trial court.
Indeed, the abuse of discretion it committed amounted to an evasion of positive duty or
virtual refusal to perform a duty enjoined by law, or to act at all in contemplation of law, 1 9
which would have warranted the extraordinary writ of certiorari. Hence, the Court of
Appeals erred when it dismissed the petition for certiorari filed by petitioners.
WHEREFORE, in view of the foregoing, the instant petition is GRANTED. This case is
REMANDED to the Regional Trial Court of Cebu City, Branch 11, which is directed to
forthwith conduct the preliminary hearing on the a rmative defenses in Civil Case No.
CEB-21854.
SO ORDERED.
Kapunan, and Pardo, JJ., concur.
Davide, Jr., C.J., see dissenting opinion.
Puno, J., joins the dissent of C.J., Davide, Jr.

Separate Opinions
DAVIDE, JR., C. J : p

I respectfully make of record my dissent to both drafts of the decision penned by

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 Mme. Justice Consuelo Y. Santiago.
I. The first draft
The rst draft (1) sets aside the Decision and Resolution of the Court of Appeals in
CA-G.R. SP No. 49084 and the Orders of the Regional Trial Court of Cebu City, Branch 11, in
Civil Case No. CEB-21854; and (2) orders of the dismissal of said civil case.
I seriously doubt the propriety of this action, even if it is principally based on the
non-payment of the de ciency of the docket fee. Sun Life Insurance O ce Ltd. v. Asuncion
(170 SCRA 274 [1989]) is not the nal word on de ciency of docket fees. Tacay v .
Regional Trial Court of Tagum, Davao del Norte , (180 SCRA 433, 443 [1989]) further
liberalized the rule. Thus:
Two situations may arise. One is where the complaint or similar pleading
sets out a claim purely for money or damages and there is no precise statement
of the amounts being claimed. In this event the rule is that the pleading will 'not
be accepted nor admitted, or shall otherwise be expunged from the record.' In
other words, the complaint or pleading may be dismissed, or the claims as to
which the amounts are unspeci ed may be expunged, although as aforestated
the Court may, on motion, permit amendment of the complaint and payment of
the fees provided the claim has not in the meantime become time-barred. The
other is where the pleading does specify the amount of every claim, but the fees
paid are insu cient; and here again, the rule now is that the court may allow a
reasonable time for the payment of the prescribed fees, or the balance thereof,
and upon such payment, the defect is cured and the court may properly take
cognizance of the action, unless in the meantime prescription has set in and
consequently barred the right of action.
Where the action involves real property and a related claim for damages as
well, the legal fees shall be assessed on the basis of both (a) the value of the
property and (b) the total amount of related damages sought. The Court acquires
jurisdiction over the action if the ling of the initiatory pleading is accompanied
by the payment of the requisite fees, or, if the fees are not paid at the time of the
ling of the pleading, as of the time of full payment of the fees within such
reasonable time as the court may grant, unless, of course, prescription has set in
in the meantime. But where — as in the case at bar — the fees prescribed for an
action involving real property have been paid, but the amounts of certain of the
related damages (actual, moral and nominal) being demanded are unspeci ed,
the action may not be dismissed. The Court undeniably has jurisdiction over the
action involving the real property, acquiring it upon the ling of the complaint or
similar pleading and payment of the prescribed fee. And it is not divested of that
authority by the circumstance that it may not have acquired jurisdiction over the
accompanying claims for damages because of lack of speci cation thereof.
What should be done is simply to expunge those claims for damages as to which
no amounts are stated, which is what the respondent Courts did, or allow, on
motion, a reasonable time far the amendment of the complaints so as to allege
the precise amount of each item of damages and accept payment of the requisite
fees therefor within the relevant prescriptive period.

Even if we would still cling to Sun Life, the rule therein laid down would still be
applicable to this case, contrary to the assertion in the ponencia in question. The evil
contemplated in Manchester case which prompted the pronouncement therein does not
exist in the instant case.
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 Verily, there is good faith on the part of the private respondents in insisting on what
their cause of action is. Even the Court of Appeals sustained their position in this issue.
Therefor, private respondents should only be required to pay the de ciency in
docket fees.
II. The second draft
The second draft ponencia declares the trial court and the Court of Appeals as
having acted with grave abuse of discretion in denying the motion for a preliminary hearing
on the a rmative defenses. The order of the trial court denying the motion is an
interlocutory order. There can be no appeal from such order of denial. A special civil action
of certiorari under Rule 65 of the Rules of Court may be resorted to, but there must be a
clear showing that the court had acted without or in excess of jurisdiction or with grave
abuse of discretion amounting to lack of or in excess of jurisdiction. Grave abuse of
discretion means arbitrary and despotic action.
I submit that the trial court did not commit any grave abuse of discretion in denying
the motion for a preliminary hearing on the a rmative defenses on the ground that such
defenses do not appear to be indubitable. The ponencia itself admits that only some of the
defenses appeared indubitable. The last paragraph of page 10 of the latest draft of the
ponencia reads:
True, the trial court has the discretion to conduct a preliminary hearing on
a rmative defenses. In the case at bar, however, the trial court committed a
grave abuse of its discretion when it denied the motion for preliminary hearing. As
we have discussed above, some of these defenses, which petitioners invoked as
grounds for the dismissal of the action, appeared to be indubitable, contrary to
the pronouncement of the trial court. Indeed, the abuse of discretion it committed
amounted to an evasion of positive duty or virtual refusal to perform a duty
enjoined by law, or to act at all in contemplation of law, which would have
warranted the extraordinary writ of certiorari. Hence, the Court of Appeals erred
when it dismissed the petition for certiorari led by petitioners. (italics supplied
for emphasis)

Accordingly, since the orders of the trial court are not tainted with grave abuse of
discretion, the Court of Appeals committed no error in dismissing the petition for certiorari
against said orders.
I then vote to deny due course to the petition. DcCASI

Footnotes
1. Rollo, pp. 56-65; penned by Associate Justice Artemon D. Luna; concurred in by
Associate Justices Conchita Carpio Morales and Bernardo P. Abesamis.

2. Ibid., pp. 67-69; penned by Associate Justice Conchita Carpio Morales; concurred in by
Associate Justices Bernardo P. Abesamis and Jose L. Sabio, Jr.
3. Petition, Annexes "C", "D" and "E", Rollo pp. 70-72.

4. Ibid., Annexes "F", "G", "H", "I", "J" and "K", Rollo pp. 73-84.
5. Id., Annex "L", Rollo, p. 85.

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 6. Id., Annex "M", Rollo, p. 86.
7. Id., Annex "N", Rollo, pp. 87-88.
8. Op. cit., note 1.

9. Op. cit., note 2.

10. Rollo, p. 25.

11. Ibid., pp. 123-143.
12. 170 SCRA 274 (1989).
13. David v. Malay, 318 SCRA 711 (1999).
14. 81 SCRA 75 (1978).

15. Torres v. J.M. Tuason & Co., Inc., 12 SCRA 174 (1964).
16. Supra.
17. Ibid.
18. 283 SCRA 493 (1997).

19. People v. Chavez, G.R. No. 140690, June 19, 2001.

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