FIRST DIVISION

G.R. No. 146089            December 13, 2001

VIRGINIA GOCHAN, LOUISE GOCHAN, LAPU-LAPU REAL ESTATE CORPORATION, FELIX GOCHAN AND
REALTY CORPORATION, MACTAN REALTY DEVELOPMENT CORPORATION, petitioners,
vs.
MERCEDES GOCHAN, ALFREDO GOCHAN, ANGELINA GOCHAN-HERNAEZ, MA. MERCED GOCHAN GOR
CRISPO GOCHAN, JR., and MARLON GOCHAN, respondents.

YNARES-SANTIAGO, J.:

This is a petition for review seeking to set aside the decision of the Court of Appeals dated September 10, 1999 in
No. 49084,1 as well as its Resolution2 dated November 22, 2000, denying the Motion for Reconsideration.

Respondents were stockholders of the Felix Gochan and Sons Realty Corporation and the Mactan Realty Develo
Corporation. Sometime in 1996, respondents offered to sell their shares in the two corporations to the individual p
heirs of the late Ambassador Esteban Gochan, for and in consideration of the sum of P200,000,000:00. Petitioner
paid the said amount to respondents. Accordingly, respondents issued to petitioners the necessary "Receipts." 3 In
respondents executed their respective "Release, Waiver and Quitclaim," 4 wherein .they undertook that they would
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 u
to divulge the actual consideration they paid for the shares of stock. For this purpose, Crispo Gochan, Jr. drafted
entitled "promissory note" in his own handwriting and had the same signed by Felix Gochan, III, Louise Gochan a
Gochan, Jr.

Unbeknown to petitioners, Crispo Gochan, Jr. inserted in the "promissory note" a phrase that says, "Said amount
consideration of the sale."6

On April 3, 1998, respondents filed a complaint against petitioners for specific performance and damages with the
Court of Cebu City, Branch 11, docketed as Civil Case No. CEB-21854. Respondents alleged that sometime in N
petitioner Louise Gochan, on behalf of all the petitioners, offered to buy their shares of stock, consisting of 254 sh
Gochan and Sons Realty Corporation and 1,624 shares of stock in the Mactan Realty Development Corporation;
executed a Provisional Memorandum of Agreement, wherein they enumerated the following as consideration for t

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 ad
amount of P200,000,000.00, which they acknowledge to have received from petitioners. Further, respondents pra
damages of P15,000,000.00, exemplary damages of P2,000,000.00, attorney's fees of P14,000,000.00, and litiga
of P2,000,000.00.

Petitioners filed their answer, raising the following affirmative defenses: (a) lack of jurisdiction by the trial court for
of the correct docket fees; (b) unenforceability of the obligation to convey real properties due to lack of a written m
thereof, pursuant to the Statute of Frauds; (c) extinguishment of the obligation by payment; (d) waiver, abandonm
renunciation by respondent of all their claims against petitioners; and (e) non-joinder of indispensable parties.

On August 7, 1998, petitioners filed with the trial court a motion for a preliminary hearing on the affirmative defens
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 199
Procedure, this Court in the exercise of its discretion, hereby denies the said motion because the
to be preliminarily heard do not appear to be tenable. For one, the statute of frauds does not apply
because the contract which is the subject matter of this case is already an executed contract. The
frauds applies only to executory contracts. According to Dr. Arturo M. Tolentino, a leading authorit
since the statute of frauds was enacted for the purpose of preventing frauds, it should not be mad
to further them. Thus, where one party has performed his obligation under a contract, equity would
evidence should be admitted to prove the alleged agreement (PNB vs. Philippine Vegetable Oil Co
Phil. 897). For another, the contention of the defendants that the claims of the plaintiffs are alread
by full payment thereof does not appear to be indubitable because the plaintiffs denied under oath
execution and genuineness of the receipts which are attached as Annexes 1-A, 1-B and 1-C of de
answer. This issue therefore has to be determined on the basis of preponderance of evidence to b
both parties. Then, still for another, the contention that the complaint is defective because it allege
implead indispensable parties appears to be wanting in merit because the parties to the memoran
agreement adverted to in the complaint are all parties in this case. Then the matter of payment of
filing fees is not a fatal issue in this case because the record shows that the plaintiffs had paid at l
P165,000.00 plus in the form of filing and docketing fees. Finally, regarding exerting earnest effort
compromise by the plaintiffs, the defendants cannot say that there is an absence of an allegation t
the complaint because paragraph 11 of the complaint precisely states that "before filing this case,
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 filed a petition for certiorari with the Court of Appeals, docketed as CA-G.R. SP No. 49084. On Se
1999, the Court of Appeals rendered the appealed decision dismissing the petition on the ground that respondent
commit grave abuse of discretion, tantamount to lack or in excess of jurisdiction in denying the motion to hear the
defenses.8

Again, petitioners filed a motion for reconsideration, but the same was denied by the Court of Appeals in its assail
of November 22, 2000.9

Petitioners, thus, filed the instant petition for review anchored on the following grounds:

I.

THE COURT OF APPEALS COMMITTED GRAVE AND PALPABLE ERROR IN FINDING THAT T
DOCKET FEES HAVE BEEN PAID.

II.

THE COURT OF APPEALS COMMITTED SERIOUS ERROR IN RULING THAT THE PMOA WAS
 EXECUTED CONTRACT AND HENCE NOT COVERED BY THE STATUTE OF FRAUDS.

III.

THE COURT OF APPEALS COMMITTED GRAVE ERROR IN DECIDING THAT THE CLAIMS O
RESPONDENTS HAVE NOT BEEN EXTINGUISHED BY PAYMENT OR FULL SETTLEMENT DE
PRESENCE OF RECEIPTS SIGNED BY THE PRIVATE RESPONDENTS SHOWING THE CONT

IV.

THE COURT OF APPEALS COMMITTED GRAVE ERROR IN RESOLVING THAT FELIX GOCHA
ESTEBAN GOCHAN, JR. ARE NOT INDISPENSABLE PARTIES AND THEREFORE NEED NOT
IMPLEADED AS PARTIES.10

Respondents filed their Comment,11 arguing, in fine, that petitioners are guilty of forum-shopping when they filed tw
certiorari with the Court of Appeals; and that the Court of Appeals did not err in dismissing the petition for certiora

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
the case of Sun Insurance Office, Ltd. (SIOL) v. Asuncion,12 this Court held that it is not simply the filing of the com
appropriate initiatory pleading, but the payment of the prescribed docket fee that vests a trial court with jurisdiction
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 filed the co
trial court. Petitioners, on the other hand, contend that the complaint is in the nature of a real action which affects
properties; hence, respondents should have alleged therein the value of the real properties which shall be the bas
assessment of the correct docket fees.

The Court of Appeals found that the complaint was one for specific performance and incapable of pecuniary estim
not agree.

It is necessary to determine the true nature of the complaint in order to resolve the issue of whether or not respon
correct amount of docket fees therefor. In this jurisdiction, the dictum adhered to is that the nature of an action is d
the allegations in the body of the pleading or complaint itself, rather than by its title or heading. 13 The caption of th
below was denominated as one for "specific performance and damages." The relief sought, however, is the conve
transfer of real property, or ultimately, the execution of deeds of conveyance in their favor of the real properties en
the provisional memorandum of agreement. Under these circumstances, the case below was actually a real action
does title to or possession of real property.

In the case of Hernandez v. Rural Bank of Lucena,14 this Court held that a real action is one where the plaintiff see
of real property or, as indicated in section 2(a) of Rule 4 (now Section 1, Rule 4 of the 1997 Rules of Civil Procedu
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 specific performance but nonetheless prays for
a deed of sale for a parcel of land, its primary objective and nature is one to recover the parcel of land itself and, t
a real action. In such a case, the action must be filed in the proper court where the property is located:

In this Court, the appellant insists that her action is one for specific performance, and, therefore, p
transitory in nature.

This very issue was considered and decided by this Court in the case of Manuel B. Ruiz vs. J.M. T
Inc. et al., L-18692, promulgated 31 January 1963. There the Court, by unanimous vote of all the J
 as follows:

'This contention has no merit. Although appellant's complaint is entitled to be one for spec
performance, yet the fact that he asked that a deed of sale of a parcel of land situated in Q
issued in his favor and that a transfer certificate of title covering said parcel of land be issu
shows that the primary objective and nature of the action is to recover the parcel of land its
execute in favor of appellant the conveyance requested there is need to make a finding th
owner of the land which in the last analysis resolves itself into an issue of ownership. Henc
must be commenced in the province where the property is situated pursuant to Section 3,
Rules of Court, which provides that actions affecting title to or recovery of possession of re
shall be commenced and tried in the province where the property or any part thereof lies."

In the case at bar, therefore, the complaint filed with the trial court was in the nature of a real action, although oste
denominated as one for specific performance. Consequently, the basis for determining the correct docket fees sh
assessed value of the property, or the estimated value thereof as alleged by the claimant. Rule 141, Section 7, of
Court, as amended by A.M. No. 00-2-01-SC, provides:

Section 7. Clerks of Regional Trial Courts. — x x x

(b) xxx           xxx           xxx

In a real action, the assessed value of the property, or if there is none, the estimated value thereo
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,16 to the effect that in case the filing of t
pleading is not accompanied by payment of the docket fee, the court may allow payment of the fee within a reaso
in no case beyond the applicable prescriptive period. However, the liberal interpretation of the rules relating to the
docket fees as applied in the case of Sun Insurance cannot apply to the instant case as respondents have never
any willingness to abide by the rules and to pay the correct docket fees. Instead, respondents have stubbornly ins
case they filed was one for specific performance and damages and that they actually paid the correct docket fees
time of the filing of the complaint. Thus, it was stated in the case of Sun Insurance:17

The principle in Manchester could very well be applied in the present case. The pattern and the in
the government of the docket fee due it is obvious not only in the filing of the original complaint bu
filing of the second amended complaint.

However, in Manchester, petitioner did not pay any additional docket fee until the case was decide
on May 7, 1987. Thus, in Manchester, due to the fraud committed on the government, this Court h
court a quo did not acquire jurisdiction over the case and that the amended complaint could not ha
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 M
private respondent demonstrated his willingness to abide by the rules by paying the additional doc
required. The promulgation of the decision in Manchester must have had that sobering influence o
respondent who thus paid the additional docket fee as ordered by the respondent court. It triggere
stance by manifesting his willingness to pay such additional docket fee as may be ordered.

Respondents accuse petitioners of forum-shopping when they filed two petitions before the Court of Appeals. Pet
other hand, contend that there was no forum-shopping as there was no identity of issues or identity of reliefs soug
petitions.

We agree with petitioners that they are not guilty of forum-shopping. The deplorable practice of forum-shopping is
litigants who, for the purpose of obtaining the same relief, resort to two different fora to increase his or her chance
favorable judgment in either one. In the case of Golangco v. Court of Appeals,18 we laid down the following test to
whether there is forum-shopping:

Ultimately, what is truly important to consider in determining whether forum-shopping exists or not
caused the courts and the parties-litigant by a person who asks different courts and/or administrat
rule on the same or related causes and/or grant the same or substantially the same reliefs, in the
creating the possibility of conflicting decisions being rendered by the different fora upon the same

In sum, two different orders were questioned, two distinct causes of action and issues were raised
objectives were sought; thus, forum shopping cannot be said to exist in the case at bar.

Likewise, we do not find that there is forum-shopping in the case at bar. The first petition, docketed as CA-G.R. S
which is now the subject of the instant petition, involved the propriety of the affirmative defenses relied upon by pe
Case No. CEB-21854. The second petition, docketed as CA-G.R. SP No. 54985, raised the issue of whether or n
respondent Judge Dicdican was guilty of manifest partiality warranting his inhibition from further hearing Civil Cas
21854.

More importantly, the two petitions did not seek the same relief from the Court of Appeals. In CA-G.R. SP. No. 49
prayed, among others, for the annulment of the orders of the trial court denying their motion for preliminary hearin
affirmative defenses in Civil Case No. CEB-21854. No such reliefs are involved in the second petition, where petit
prayed for the issuance of an order enjoining public respondent Judge Dicdican from further trying the case and to
judge in his stead.

True, the trial court has the discretion to conduct a preliminary hearing on affirmative defenses. In the case at bar
trial court committed a grave abuse of its discretion when it denied the motion for preliminary hearing. As we have
above, some of these defenses, which petitioners invoked as grounds for the dismissal of the action, appeared to
contrary to the pronouncement of the trial court. Indeed, the abuse of discretion it committed amounted to an evas
duty or virtual refusal to perform a duty enjoined by law, or to act at all in contemplation of law, 19 which would have
extraordinary writ of certiorari. Hence, the Court of Appeals erred when it dismissed the petition for certiorari filed

WHEREFORE, in view of the foregoing, the instant petition is GRANTED. This case is REMANDED to the Region
Cebu City, Branch 11, which is directed to forthwith conduct the preliminary hearing on the affirmative defenses in
CEB-21854.

SO ORDERED.

Davide, Jr., C.J.;Kapunan, and Pardo, JJ., concur.

DISSENTING OPINION

DAVIDE, JR., C.J.:

I respectfully make of record my dissent to both drafts of the decision penned by Mme. Justice Consuelo Y. Santia

I. The first draft

The first draft (1) sets aside the Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 49084 and th
Regional Trial Court of Cebu City, Branch 11, in Civil Case No. CEB-21854; and (2) orders of the dismissal of said

I seriously doubt the propriety of this action, even if it is principally based on the non-payment of the deficiency of
fee. Sun Life Insurance Office Ltd. v. Asuncion (170 SCRA 274 [1989]) is not the final word on deficiency of docke
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 fo
damages and there is no precise statement of the amounts being claimed. In this event the rule is
pleading will 'not be accepted nor admitted, or shall otherwise be expunged from the record.' In ot
complaint or pleading may be dismissed, or the claims as to which the amounts are unspecified m
expunged, although as aforestated the Court may, on motion, permit amendment of the complaint
of the fees provided the claim has not in the meantime become time-barred. The other is where th
specify the amount of every claim, but the fees paid are insufficient; and here again, the rule now
may allow a reasonable time for the payment of the prescribed fees, or the balance thereof, and u
payment, the defect is cured and the court may properly take cognizance of the action, unless in t
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 sh
on the basis of both (a) the value of the property and (b) the total amount of related damages soug
acquires jurisdiction over the action if the filing of the initiatory pleading is accompanied by the pay
requisite fees, or, if the fees are not paid at the time of the filing of the pleading, as of the time of fu
the fees within such reasonable time as the court may grant, unless, of course, prescription has se
meantime. But where — as in the case at bar — the fees prescribed for an action involving real pr
been paid, but the amounts of certain of the related damages (actual, moral and nominal) being de
unspecified, the action may not be dismissed. The Court undeniably has jurisdiction over the actio
real property, acquiring it upon the filing of the complaint or similar pleading and payment of the pr
And it is not divested of that authority by the circumstance that it may not have acquired jurisdictio
accompanying claims for damages because of lack of specification thereof. What should be done
expunge those claims for damages as to which no amounts are stated, which is what the respond
or allow, on motion, a reasonable time far the amendment of the complaints so as to allege the pre
each item of damages and accept payment of the requisite fees therefor within the relevant prescr

Even if we would still cling to Sun Life, the rule therein laid down would still be applicable to this case, contrary to
the ponencia in question. The evil contemplated in Manchester case which prompted the pronouncement therein
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
Appeals sustained their position in this issue.

Therefor, private respondents should only be required to pay the deficiency 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 d
denying the motion for a preliminary hearing on the affirmative defenses. The order of the trial court denying the m
interlocutory order. There can be no appeal from such order of denial. A special civil action of certiorari under Rul
Rules of Court may be resorted to, but there must be a clear showing that the court had acted without or in exces
or with grave abuse of discretion amounting to lack of or in excess of abuse of discretion means arbitrary and juris
despotic action.

I submit that the trial court did not commit any grave abuse of discretion in denying the motion for a preliminary he
affirmative defenses on the ground that such defenses do not appear to be indubitable. The ponencia itself admits
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 affirmative defenses. In
however, the trial court committed a grave abuse of its discretion when it denied the motion for pre
hearing. As we have discussed above, some of these defenses, which petitioners invoked as grou
dismissal of the action, appeared to be indubitable, contrary to the pronouncement of the trial cour
abuse of discretion it committed amounted to an evasion of positive duty or virtual refusal to perfo
enjoined by law, or to act at all in contemplation of law, which would have warranted the extraordin
of certiorari. Hence, the Court of Appeals erred when it dismissed the petition for certiorari filed by
 (Underscoring supplied for supplied)

Accordingly, since the orders of the trial court are not tainted with grave abuse of discretion, the Court of Appeals
error in dismissing the petition for certiorari against said orders.

I then vote to deny due course to the petition.

Footnotes

 Rollo, pp. 56-65; penned by Associate Justice Artemon D. Luna; concurred in by Associate Justi
1

Carpio Morales and Bernardo P. Abesamis.

 Ibid., pp. 67-69; penned by Associate Justice Conchita Carpio Morales; concurred in by Associat
2

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.

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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