One of the frequently asked bar questions on remedial law is that dealing with actions incapable of pecuniary estimation. Under Section 19(1) of B.P. Blg. 129, the RTC shall exercise exclusive original jurisdiction in all civil actions in which the subject of the litigation is incapable of pecuniary estimation.
The challenge for the bar examinee is to determine whether an action is incapable of pecuniary estimation and thus within the RTC’s exclusive original jurisdiction. This short note aims to provide the bar examinee with some rules of thumb or hacks, if you may, to enable him to tackle this kind of questions and to present a logical answer.
Meaning of actions incapable of pecuniary estimation
What is meant by a civil action in which the subject of the litigation is incapable of pecuniary estimation? Before defining an action incapable of pecuniary estimation, it might be worthwhile to define first an action which is capable of pecuniary estimation.
An action capable of pecuniary estimation is one wherein the primary or principal relief sought is a claim for a sum of money or the assertion of title to or possession of personal or real property. In such a case the action is capable of pecuniary estimation based on the amount of the monetary claim or the value of the personal or real property.
Conversely an action incapable of pecuniary estimation is one wherein the primary or principal relief sought is not a claim for a sum of money or the assertion of title to or possession of personal or real property but some other primary or principal relief which cannot be valued in monetary terms.
An action for foreclosure of real estate mortgage is a real action since it involves title to real property. The purpose of the action is to foreclose upon the mortgagor’s and junior encumbrancers’ right to the real property and to vest it in the purchaser. Hence a foreclosure suit is not one which is incapable of pecuniary estimation and jurisdiction would thus depend upon the assessed value of the foreclosed realty. (Roldan v. Barrios, 23 April 2018).
Nature of the action test
How does a bar examinee determine if a bar question deals with an action incapable of pecuniary estimation? I recommend two tests for the bar examinee. The first one is what I would call the nature-of-the-action test. If a bar exam question mentions merely the action or remedy which by its nature is incapable of pecuniary estimation without mentioning any pecuniary relief sought by the plaintiff, then it would be the RTC which would have subject-matter jurisdiction.
The bar examinee would do well to know the following actions which by their nature are incapable of pecuniary estimation: specific performance, rescission or annulment of contract, injunction, declaratory relief, reformation of contract, revival of judgment, citizen’s suit, and abatement of nuisance.
Illustration:
“Q Amorsolo, a Filipino citizen permanently residing in New York City, filed with the RTC of Lipa City a Complaint for Rescission of Contract of Sale of Land against Brigido, a resident of Barangay San Miguel, Sto. Tomas, Batangas. The subject property, located in Barangay Talisay, Lipa City, has an assessed value of ₱19,700.00. xxx
“Brigido filed a motion to dismiss the complaint on the following grounds:
xxx
“[b] The RTC does not have jurisdiction over the subject matter of the action involving real property with an assessed value of ₱19,700.00; exclusive and original jurisdiction is with the Municipal Trial Court where the defendant resides;
xxx
“Rule on the foregoing grounds with reasons.” (2009 Remedial Law Bar Exam Question No. 3[b]).
Comment
Here the bar question mentions only the action filed or the remedy availed of, that is, rescission of sale of land but without mentioning that Amorsolo was asserting title to or possession over the land as against Brigido. The action is thus incapable of pecuniary estimation and thus falls within the RTC’s exclusive original jurisdiction. The assessed value of the land is irrelevant.
Ultimate objective test
The action or remedy mentioned in the bar question may be one which by its nature is incapable of pecuniary estimation; however the facts show that the ultimate or principal relief sought by the plaintiff is to claim a sum of money or to assert title to or possession over personal or real property. In such a case the action is capable of pecuniary estimation. Jurisdiction would then be based on the amount of the monetary claim, the value of the personal property, or the assessed value of the real property.
Illustration:
“Q A filed with the Metropolitan Trial Court of Manila an action for specific performance against B, a resident of Quezon City, to compel the latter to execute a deed of conveyance covering a parcel of land situated in Quezon City having an assessed value of P19,000.00. B received the summons and a copy of the Complaint on 02 January 2003. On 10 January 2003, B filed a Motion to Dismiss the Complaint on the ground of lack of jurisdiction contending that the subject matter of the suit was incapable of pecuniary estimation. The court denied the motion.
“[a] Was the denial of the Motion to Dismiss the Complaint correct?” (2003 Remedial Law Bar Exam Question No. 3).
Comment
The action filed is for specific performance which by its nature is incapable of pecuniary estimation. However analysis of the bar question reveals that the ultimate or principal relief sought by A is to assert title over the land by compelling B to execute a deed of conveyance over it. Hence the action is capable of pecuniary estimation, to be more precise, a real action. Jurisdiction is thus vested in the MTC since the assessed value does not exceed ₱50,000. (Ruby Shelters Builders v. Formaran, G.R. No. 175914, 10 February 2009; Gochan v. Gochan, 423 Phil. 491 [2001]).
Take note however that even if the bar problem mentions that the plaintiff is seeking pecuniary relief but such relief is only incidental, or in other words is not the principal or ultimate objective, the action would still be one which is incapable of pecuniary estimation.
Illustration
“Q Prince Chong entered into a lease contract with King Kong over a commercial building where the former conducted his hardware business. The lease contract stipulated, among others, a monthly rental of ₱50,000.00 for a four-year period commencing on January 1, 2010. On January 1, 2013, Prince Chong died. Kin Il Chong was appointed administrator of the estate of Prince Chong, but the former failed to pay the rentals for the months of January to June 2013 despite King Kong’s written demands.
“Thus, on July 1, 2013, King Kong filed with the Regional Trial Court (RTC) an action for rescission of contract with damages and payment of accrued rentals as of June 30, 2013.
“(A) Can Kin Il Chong move to dismiss the complaint on the ground that the RTC is without jurisdiction since the amount claimed is only ₱300,000.00?” (2014 Remedial Law Bar Exam Question No. 10[a])
Comment
At first blush, one may conclude that the RTC is without jurisdiction because King Kong is asserting a pecuniary relief, that is, damages of ₱300,000, and hence it is the MTC which has jurisdiction because the claim does not exceed ₱300,000.
However a more circumspect analysis would show that the claim for the damages is only incidental to the principal relief sought, that is, the rescission of the contract. Hence the action is incapable of pecuniary estimation and thus within the RTC’s jurisdiction.
Conclusion
This short note provides the bar reviewee only with rules of thumb. Questions dealing with the determination of whether an action is capable or incapable of pecuniary estimation are devilishly tricky. The difficulty is in determining whether the pecuniary relief sought is a principal one or merely incidental. The ideal solution of course is for the reviewee to be well-versed in leading jurisprudence on the matter. If the reviewee is unaware of such jurisprudence, then the rules of thumb would at least allow him to present a logical and lawyer-like argument.
For instance, an action for interpleader would by its nature be one which is incapable of pecuniary estimation. After all, the plaintiff has no interest in the subject matter of the interpleader or has an interest which is not disputed by the conflicting claimants and thus not the subject of the litigation. Nonetheless, the Supreme Court has held that jurisprudence over such action would depend upon the value of the property subject of the interpleader. (Makati Dev’t Corp. v. Tanjuatco, 27 SCRA 401 [1969]).
An examinee who however applies the rules of thumb and concludes that the action is incapable of pecuniary estimation would still get credit for his answer since he has tackled the relevant issue and presented a logical argument.
-oOo-
Goe bless you more Sir!
God Bless you atty. thank you for sharing your knowledge about the law and for making it easier for us to understand and know about the law.
Thank You Atty.