DECLARATORY RELIEF: CASE: Tambunting vs. Sps. Sumabat GR No. 144101, September 16, 2005

FACTS: Facts: Spouses Sumabat and Baello were the registered land owners of a parcel of land in Caloocan. In May 1973, and in order to obtain a P7,727.95 loan from petitioner Tambunting, the spouses mortgaged said land to the former. Subsequently, Tambunting assigned his rights to the mortgaged to Commercial House Finance (CHFI). And because respondent spouses have not been paying their monthly amortizations, they were informed that their indebtedness has ballooned to P15k.

And so, CHFI and Tambunting filed a case for foreclosure but was restrained by Branch 33 of the RTC of Caloocan. The reason for the restraint was because the respondents were able to file an action for declaratory relief with said RTC. In their action, respondents were praying that the court rule on the extent or amount of their actual indebtedness.

In said RTC case, which was filed March 1979, herein petitioners were declared in default. Thus, even when the Tambunting, et al moved for the dismissal of the case on the ground that mortgaged deed/contract had already been breached prior to the action, said motion was denied for having been filed out of time.

On Jan. 1981, the RTC rendered a decision finding that respondents liability, by virtue of their mortgage deed/contract, was P15,743.83. Pursuant to this decision, the respondents made a consignation with the RTC in said amount.

After almost 14 years, or on Feb 1995, CHFI again foreclosed on the contested land. The respondents came to know of this because they received a notice of foreclosure sale, to be conducted by the sheriff, of the land in question

This time, the petitioners filed an action with Branch 120 of the RTC of Caloocan for injunction against the foreclosure sale. But, the sale still pushed thru, with CHFI being declared the highest bidder. A new TCT was then issued to CHFI. Thus, respondent spouses amended their complaint to an action for nullification of the foreclosure/sheriffs sale, the new TCT of CHFI, as well as reconveyance.

On Feb 2000, Branch 120 of the RTC declared the foreclosure sale as void. It likewise ruled that reconveyance of the property should be made to the respondents. This decision was grounded on the fact that consignation of P15k has already been made by CHFI pursuant to the earlier decision of the Branch 33 of the RTC.

After a denial of petitioners MR, they filed petition for review on certiorari with the SC. The petitioners argued that RTC, Branch 33, erred when it ordered the consignation of P15k. As earlier pointed out, the action in first case was for declaratory relief. But petitioner points out the fact that respondents are not entitled anymore to file an action for declaratory relief because there had already been a violation of the mortgaged contract when the spouses defaulted on their amortizations. Furthermore the action for foreclosure by CHFI on 1995 has already prescribed

ISSUES:1. Was the decision of Branch 120 of the RTC wrong when it ordered the nullification of the foreclosure sale on the ground that consignation has already been made in a previous case?

2. Was the foreclosure action in 1995 and subsequent sale of the property already barred by prescription?

3. Thus, should the action for nullification and reconveyance filed by the respondents be dismissed?

HELD: The trial court erred when it affirmed the validity of the consignation. The RTC should have been barred from taking cognizance of the action for declaratory relief since petitioners, being already in default in their loan amortizations, there existed a violation of the mortgage deed even before the institution of the action. Hence, the CFI could not have rendered a valid judgment in Civil Case No. C-7496, and the consignation made pursuant to a void judgment was likewise void.

An action for declaratory relief should be filed by a person interested under a deed, will, contract or other written instrument, and whose rights are affected by a statute, executive order, regulation or ordinance before breach or violation thereof. The purpose of the action is to secure an authoritative statement of the rights and obligations of the parties under a statute, deed, contract, etc. for their guidance in its enforcement or compliance and not to settle issues arising from its alleged breach. It may be entertained only before the breach or violation of the statute, deed, contract, etc. to which it refers. Where the law or contract has already been contravened prior to the filing of an action for declaratory relief, the court can no longer assume jurisdiction over the action.

Nonetheless, the petition must fail.

Article 1142 of the Civil Code is clear. A mortgage action prescribes after ten years.

Here, petitioners right of action accrued in May 1977 when respondents defaulted in their obligation to pay their loan amortizations. It was from that time that the ten-year period to enforce the right under the mortgage started to run. The period was interrupted when respondents filed Civil Case No. C-6329 sometime after May 1977 and the CFI restrained the intended foreclosure of the property. However, the period commenced to run again on November 9, 1977 when the case was dismissed.

A. Nature of Declaratory Relief:

An action for declaratory relief should be filed by a person interested under a deed, will, contract or other written instrument, and whose rights are affected by a statute, executive order, regulation or ordinance before breach or violation thereof.

B. Purpose of Declaratory Relief:

The purpose of the action is to secure an authoritative statement of the rights and obligations of the parties under a statute, deed, contract, etc. for their guidance in its enforcement or compliance and not to settle issues arising from its alleged breach.2 It may be entertained only before the breach or violation of the statute, deed, contract, etc. to which it refers. CASE: Almeda vs. Bathala Marketing Industries GR No. 150806, Januray 28, 2008

FACTS: Respondent Bathala Marketing Industries renewed its contract of lease with Ponciano Almeda, the father of Romel Almeda and the husband of Eufemia, who are the petitioners in this case. The contract of lease contains the following provisions which give rise to the instant case, to wit:

SIXTH - It is expressly understood by the parties hereto that the rental rate stipulated is based on the present rate of assessment on the property, and that in case the assessment should hereafter be increased or any new tax, charge or burden be imposed by authorities on the lot and building where the leased premises are located, LESSEE shall pay, when the rental herein provided becomes due, the additional rental or charge corresponding to the portion hereby leased; provided, however, that in the event that the present assessment or tax on said property should be reduced, LESSEE shall be entitled to reduction in the stipulated rental, likewise in proportion to the portion leased by him;

SEVENTH - In case an extraordinary inflation or devaluation of Philippine Currency should supervene, the value of Philippine peso at the time of the establishment of the obligation shall be the basis of payment;

During the effectivity of the contract, Ponciano died. Petitioners therein in a letter, advised respondent Bathala that it would be assessed and collect VAT from its monthly rentals. In response, Bathala contend that VAT may not be imposed as the rentals fixed on the contact of lease were supposed to include VAT, in lieu that there contract was established when the VAT law has been effected. However, respondent received another letter from the petitioners informing the former that its monthly rental should be increased by 73% pursuant to condition no. 7 of the contact and Article 1250 of the civil code. Bathala opposed the said increased arguing that there was no extraordinary inflation to warrant the application of the said Article. Hence, respondent Bathala instituted an action for declaratory relief to determine the correct interpretation of the conditions no. 6 and 7 of the contract of lease. In turn, petitioners instituted an action for ejectment, rescission and damages against respondent for failure to heed the demand to vacate the premises. In addition, they moved to dismiss the action for declaratory relief since respondent already breach the obligation and the case would not end the litigation and settle the rights of the parties. The RTC ruled in favor of Bathala. On appeal, the Court of Appeals affirmed the trial courts decision. Hence, the matter was raised before the Supreme Court.

ISSUE: Whether or not declaratory relief was proper considering that Bathala was in breach of obligation when it filed the action before the trail court? HELD: YES. Petitioners insists that respondent was already in breach of the contract when the petition was filed. We do not agree. After petitioners demanded payment of adjusted rentals and in the months that followed, respondent complied with the terms and conditions set forth in their contract of lease by paying the rentals stipulated therein. Respondent religiously fulfilled its obligations to petitioners even during the pendency of the present suit. There is no showing that respondent committed an act constituting a breach of the subject contract of lease. Thus, respondent is not barred from instituting before the trial court the petition for declaratory relief. A. Requisites of Declaratory Relief: Decisional law enumerates the requisites of an action for declaratory relief, as follows:

1) the subject matter of the controversy must be a deed, will, contract or other written instrument, statute, executive order or regulation, or ordinance;

2) the terms of said documents and the validity thereof are doubtful and require judicial construction;

3) there must have been no breach of the documents in question;

4) there must be an actual justiciable controversy or the "ripening seeds" of one between persons whose interests are adverse;

5) the issue must be ripe for judicial determination; and

6) adequate relief is not available through other means or other forms of action or proceeding.

B. On the issue on the separate actions instituted by the petitioners:

Petitioners claim that the instant petition is not proper because a separate action for rescission, ejectment and damages had been commenced before another court; thus, the construction of the subject contractual provisions should be ventilated in the same forum.

We are not convinced.

It is true that in Panganiban v. Pilipinas Shell Petroleum Corporation17 we held that the petition for declaratory relief should be dismissed in view of the pendency of a separate action for unlawful detainer. However, we cannot apply the same ruling to the instant case. In Panganiban, the unlawful detainer case had already been resolved by the trial court before the dismissal of the declaratory relief case; and it was petitioner in that case who insisted that the action for declaratory relief be preferred over the action for unlawful detainer. Conversely, in the case at bench, the trial court had not yet resolved the rescission/ejectment case during the pendency of the declaratory relief petition. In fact, the trial court, where the rescission case was on appeal, itself initiated the suspension of the proceedings pending the resolution of the action for declaratory relief.

We are not unmindful of the doctrine enunciated in Teodoro, Jr. v. Mirasol where the declaratory relief action was dismissed because the issue therein could be threshed out in the unlawful detainer suit. Yet, again, in that case, there was already a breach of contract at the time of the filing of the declaratory relief petition. This dissimilar factual milieu proscribes the Court from applying Teodoro to the instant case.

Given all these attendant circumstances, the Court is disposed to entertain the instant declaratory relief action instead of dismissing it, notwithstanding the pendency of the ejectment/rescission case before the trial court. The resolution of the present petition would write finis to the parties' dispute, as it would settle once and for all the question of the proper interpretation of the two contractual stipulations subject of this controversy

CASE: Republic of the Philippines vs. Orbicido GR No. 154380, October 5, 2005.

FACTS: On May 24, 1981, Cipriano Orbecido III and Lady Myros Villanueva were married in Lam-an, Ozamis City and were blessed with a son and a daughter. In 1986, Lady Myros left for the U. S. bringing along their son and after a few years she was naturalized as an American citizen. Sometime in 2000, respondent Orbecido learned from his son who was living with his wife in the States that his wife had remarried after obtaining her divorce decree. Thereafter, he filed a petition for authority to remarry with the trial court invoking par. 2 of Art. 26 of the Family Code. Having no opposition, on May 15, 2002, the Regional Trial Court of Zamboanga del Sur granted the petition of the respondent and allowed him to remarry. The Solicitor Generals motion for reconsideration was denied. In view of that, petitioner filed this petition for review on certiorari of the Decision of the Regional Trial Court. Herein petitioner raised the issue of the applicability of Art. 26 par. 2 to the instant case. The OSG contends that Paragraph 2 of Article 26 of the Family Code is not applicable to the instant case because it only applies to a valid mixed marriage; that is, a marriage celebrated between a Filipino citizen and an alien. The proper remedy, according to the OSG, is to file a petition for annulment or for legal separation. Furthermore, the OSG argues there is no law that governs respondents situation. The OSG posits that this is a matter of legislation and not of judicial determination. ISSUE: Whether or not the petition for authority to remarry filed before the trial court actually constituted a petition for declaratory relief? HELD: YES. The requisites of a petition for declaratory relief are: (1) there must be a justiciable controversy; (2) the controversy must be between persons whose interests are adverse; (3) that the party seeking the relief has a legal interest in the controversy; and (4) that the issue is ripe for judicial determination.

This case concerns the applicability of Paragraph 2 of Article 26 to a marriage between two Filipino citizens where one later acquired alien citizenship, obtained a divorce decree, and remarried while in the U.S.A. The interests of the parties are also adverse, as petitioner representing the State asserts its duty to protect the institution of marriage while respondent, a private citizen, insists on a declaration of his capacity to remarry. Respondent, praying for relief, has legal interest in the controversy. The issue raised is also ripe for judicial determination inasmuch as when respondent remarries, litigation ensues and puts into question the validity of his second marriage.

A. Requites of Declaratory Relief (as compared to Bathala case):

The requisites of a petition for declaratory relief are: (1) there must be a justiciable controversy; (2) the controversy must be between persons whose interests are adverse; (3) that the party seeking the relief has a legal interest in the controversy; and (4) that the issue is ripe for judicial determination.

NOTE: The Supreme Court held that Art.26, par 2 of the Civil Code is applicable when a Filipino spouse, who became a foreign citizen in another country where divorce is recognized, obtained a valid divorce decree against the other Filipino spouse. In such case, the Filipino spouse is capacitated to remarry, and to rule otherwise would be a sanction absurdity and injustice. In this case, Orbecido is capacitated to remarry but he must prove that his wife became an American Citizen, and the validity of the divorce decree since foreign laws must be proved as fact, in order to be recognized by our courts. CASE: Reyes vs. Ortiz, GR No. 137794, August 11, 2010. FACTS: The instant cases are consolidated Petitions for Declaratory Relief, Certiorari and Prohibition. In G.R. No. 137794 (1st case), petitioners Reyes et. al seek to declare null and void the proceedings in an ejectment case before MeTC, Caloocan and another case for Recovery of Possession and Ownership before RTC, Caloocan. On one hand, petitioners Sps. Embores et. al in G.R. No. 149664 (2nd case) seek to nullify of four ejectment proceedings in different MTC/RTC branches in Caloocan. By court resolution the 2nd case was terminated on Aug. 30, 2006.

The parcels of land which are the subject matter of these cases are part of the TALA ESTATE, situated between the boundaries of Caloocan City and Quezon City and encompassing an area of about 7,007.9515 hectares.

G.R. No. 137794

Sps. Bautista, Sps. Perl sought the ouster from the contested lots of Erlinda Reyes, Sps. Matienzo and Sergio Abejero, who are occupants of separate homelots in Camarin. The first case was initiated by Segundo Bautista, as the registered owner, he filed a complaint against land occupants Sps. Matienzo in RTC, Caloocan (RECOVERY CASE).

Shortly thereafter, a separate but related action for annulment of title/reversion, was initiated by the Republic (Rep: Dir. of Lands) on Dec. 27, 1996 against Biyaya Corp and RD of Cities Pasig, Caloocan and Quezon, the City of Manila and Admin of LRA involving the TALA Estate before QC-RTC. The case sought to declare the transfer titles issued by Biyaya Corp. null and void; revert the patrimonial portions of the property to the State and the same be awarded to actual occupants (ANNULMENT/REVERSION CASE). One of the intervenors were petitioners Erlinda Reyes and Rosemarie Matienzo, members of Samahan ng Maliliit na Magkakapitbahay (SAMAKABA). The QC-RTC issued Preliminary Injunction freezing all ejectment cases in the MeTCs of QC involving TALA Estate. Believing the said Injunction beneficial to them, Sps. Matienzo filed a motion to suspend the proceedings of the Recovery Case which was denied; likewise, the MR was denied. Trial on merits started on Dec. 2, 1998.

The second case, an ejectment case, was filed by Sps. Bernard and Florencia Perl against Reyes before MeTC, Caloocan. Thereafter, Sps. Perl also filed an ejectment case against Sergio Abejero. These two cases were consolidated (EJECTMENT CASES),

Reyes, in her Answer and during Preliminary Conference, moved for suspension/dismissal of these cases citing the Injuction case; the court ignored and require a position paper instead. The courts Decision ordered Reyes to vacate the contested property.

The Recovery and Ejectment cases were joined when petitioners Matienzo and Reyes filed the instant petition as Declaratory Relief, Certiorari and Prohibition assailing the denial of their respective motions for suspension.

This case is docketed as G.R. No. 137794. During the pendency of this case, certain events supervened when the Ejectment cases ran their course and Reyes appealed the MeTC decision to the RTC; meanwhile, Sps. Perl moved for execution pending appeal which was granted and accordingly a writ of execution was issued by the RTC. Thus, Reyes et. al moved for suspension of the RTC proceedings to the SC. The Court issued TRO for the implementation of the writ.

G.R. No. 149664

This case emanated from four (4) distinct ejectment complainst filed against petitioners Corazon Laurente, Sps. Alberto and Lourdes Embores, Sps. Roberto and Evelyn Palad, and Dennis Henosa. Petitioners were sought to be evicted in Camarin and are members of Alyansa ng Mga Naninirahan Sa Tala Friar Lands (ALNATFRAL). They are also intervenors in the Reversion Case. These cases were filed prior to the issuance of Injunction Order by the QC-RTC. Petitioners separately invoked the said injunction for the dismissal of the current ejectment cases against them. They directly filed their petitions with the SC.

On April 28, 2003, this Court resolved to consolidate the two cases. Since the first case was withdrawn, only the issues in the second case remain to be resolved.

ARGUMENT/s:

As to petitioner: (1) The refusal of the Caloocals MeTC and RTC to suspend the Ejectment cases despite the Injunction is tantamount to grave abuse of discretion amounting to lack or excess of jurisdiction; if so, the Decision in the Ejectment and Recovery cases must be annulled. (2) The petition is mainly for Declaratory Relief.

As to respondent: The petition for relief is not a proper remedy for the following reasons: (1) the action for petition for relief will only prosper if the statute, deed or contract has not been violated but in this case, the violation of the Injunction Order has already been made prior to the filing of the petition; thus, to rule on the petition now would only serve as an authoritative guidance for its implementation. (2) petitioners recourse was merely a ploy to substitute the filing of certiorari under Rule 65 which 60-day period already lapsed. (3) the petition was directly filed with SC in violation of Hierarchy of Courts; it should have been filed with the CA first. (4) Caloocan RTC did not err in not suspending the Recovery Case since QC-RTC is a co-equal court.

ISSUE: Whether or not the petition is one for Declaratory Relief under Section 1 of Rule 63; whether or not the petition should be granted as a proper remedy for the lower courts denial of petitioners motion for suspension of the Ejectment case while an Injunction Order was being enforced in another court.

HELD: Section 1, Rule 63 of the 1997 Rules of Court provides:

SECTION 1. Who may file petition. Any person interested under a deed, will, contract or other written instrument, or whose rights are affected by a statute, executive order or regulation, ordinance, or any other governmental regulation may, before breach or violation thereof, bring an action in the appropriate Regional Trial Court to determine any question of construction or validity arising, and for a declaration of his rights or duties, thereunder.

An action for the reformation of an instrument, to quiet title to real property or remove clouds therefrom, or to consolidate ownership under Article 1607 of the Civil Code, may be brought under this Rule.

The section can be dissected in two parts. The first paragraph concerns declaratory relief, which has been defined as a special civil action by any person interested under a deed, will, contract or other written instrument or whose rights are affected by a statute, ordinance, executive order or regulation to determine any question of construction or validity arising under the instrument, executive order or regulation, or statute and for declaration of rights and duties thereunder. The second paragraph pertains to (1) an action for the reformation of an instrument; (2) an action to quiet title; and (3) an action to consolidate ownership in a sale with a right to repurchase.

In Lerum v. Cruz (1950), the Supreme Court held that the subject matter of the petition for relief must only refer to a deed, will, contract or other written instrument or to a statute or ordinance. Any other matter not mentioned therein is deemed excluded. Expressio unius est exclussio alterius. The Court further ruled in succeeding jurisprudence that a Judges query or a court decision is not a proper subject matter of a petition for relief.

In this case, petitioners Reyes and Matienzo assailed via Declaratory Relief under Rule 63 of ROC, the orders denying their motions to suspend proceedings. This cannot be countenanced since a court order is not a proper subject matter of a petition for Declaratory Relief.

The proper remedy of Erlinda Reyes from the denial of a motion before the Caloocan MeTC was to file a motion for reconsideration and, if it is denied, to file a petition for certiorari before the RTC pursuant to Rule 65 of ROC; Whereas, the proper remedy of Matienzo should have been to file a special civil action on certiorari also under Rule 65 with CA from the denial of her motion by the Caloocan RTC. The necessity of filing the petition to the RTC in the case of Erlinda Reyes and to the Court of Appeals in the case of Matienzo is dictated by the principle of the hierarchy of courts. Both petitions must be filed within 60 days from receipt or notice of denial of the motion as provided under Section 4, Rule 65. This procedural faux pas proves fatal. The case not being one of exceptional circumstance to warrant the Supreme Court to exercise primary jurisdiction.

Matienzo obviously filed the declaratory relief as a substitute for certiorari, a remedy she lost by inaction. To recall, Matienzo received a copy of the Order of denial for her motion for reconsideration on June 9, 1998 but it was only on March 25, 1999 that she assailed the said order via this petition.

The Caloocan City RTC and MeTC did not commit grave abuse of discretion upon denying petitioners motion. It is clear from its Order, that the preliminary injunction was addressed to the MTC of QC and Caloocan City; not with the Caloocan City RTC. The order merely mentions the Caloocan City MeTCs. Nothing more. But more importantly, the Quezon City RTC could not have validly enjoined the Caloocan City RTC without violating the doctrine that no court has the power to interfere by injunction with the judgments or decrees of a court of concurrent or coordinate jurisdiction.

Hence, petitioners posture that the Ejectment cases should be suspended due to the pendency of the Annulment/Reversion case is not meritorious.

WHEREFORE, premises considered, the instant petition is hereby DISMISSED. The Temporary Restraining Order dated October 25, 2000 issued by this Court is LIFTED.

CASE: Malana vs. Tappa GR No. 181303, September 17, 2009FACTS: Petitioners alleged that they are the owners of a parcel of land situated in Tuguegarao City, Cagayan as they inherited the subject property from late Anastacio Danao. During the lifetime of Anastacio, he had allowed Consuelo Pauig to build on and occupy the southern portion of the subject property on agreement that the latter would vacate the said land at any time that Anastacio and his heirs might need it. Averring that they already needed it, petitioners demanded that respondents vacate the same. Respondents, however, refused to heed petitioners demand. The petitioners referred their land dispute with respondents to the Barangay. During the conciliation proceedings, respondents asserted that they owned the subject property and presented documents ostensibly supporting their claim of ownership, enough to create clouds on their title. Thus, petitioners filed before the RTC of Tugegarao City Complaint for Reivindicacion, Quieting of Title, and Damages.

The RTC dismissed petitioners complaint on the ground of lack of jurisdiction.

Petitioners filed two pleadings. A Motion for Reconsideration and another simply designated as motion. They argued, among others, that their principal cause of action was for quieting of title; the accion reivindicacion was included merely to enable them to seek complete relief from respondents. Their complaint should not have been dismissed, since Section 1, Rule 63 of the Rules of Court states that an action to quiet title falls under the jurisdiction of the RTC.

Both Motions were denied by the RTC. The RTC differentiated between the first and the second paragraphs of Section 1, Rule 63 of the Rules of Court. The first paragraph refers to an action for declaratory relief, which should be brought before the RTC. The second paragraph, however, refers to a different set of remedies, which includes an action to quiet title to real property. The second paragraph must be read in relation to Republic Act No. 7691, which vests the MTC with jurisdiction over real actions, where the assessed value of the real property involved does not exceed P50,000.00 in Metro Manila and P20,000.00 in all other places.

It reasoned that an action to quiet title is a real action under second paragraph of the Sec.1, Rule 63 and since the assessed value of subject property per Tax Declaration was P410.00, the real action involving the same was outside the jurisdiction of the RTC.

ISSUE: Whether the RTC committed grave abuse of discretion in dismissing petitioners complaint for lack of jurisdiction.

HELD: NO. The RTC correctly made a distinction between the first and the second paragraphs of Section 1, Rule 63 of the Rules of Court. As the provision states, a petition for declaratory relief under the first paragraph of Section 1, Rule 63 may be brought before the appropriate RTC. And to determine which court has jurisdiction over the actions identified in the second paragraph of Section 1, Rule 63 of the Rules of Court, said provision must be read together with those of the Judiciary Reorganization Act of 1980, as amended. Furthermore, an action for declaratory relief presupposes that there has been no actual breach of the instruments involved or of rights arising thereunder. Where the law or contract has already been contravened prior to the filing of an action for declaratory relief, the courts can no longer assume jurisdiction over the action. In other words, a court has no more jurisdiction over an action for declaratory relief if its subject has already been infringed or transgressed before the institution of the action.

Since petitioners averred in the Complaint that they had already been deprived of the possession of their property, the proper remedy for them is the filing of an accion publiciana or an accion reivindicatoria, not a case for declaratory relief. An accion publiciana is a suit for the recovery of possession, filed one year after the occurrence of the cause of action or from the unlawful withholding of possession of the realty. An accion reivindicatoria is a suit that has for its object ones recovery of possession over the real property as owner.

Petitioners Complaint contained sufficient allegations for an accion reivindicatoria. Jurisdiction over such an action would depend on the value of the property involved. Given that the subject property herein is valued only at P410.00, then the MTC, not the RTC, has jurisdiction over an action to recover the same. The RTC, therefore, did not commit grave abuse of discretion in dismissing, without prejudice, petitioners Complaint in Civil Case No. 6868 for lack of jurisdictionA. Distinction between the first and the second paragraphs of Section 1, Rule 63 of the Rules of Court (Declaratory Relief):

The first paragraph of Section 1, Rule 63 of the Rules of Court, describes the general circumstances in which a person may file a petition for declaratory relief, to wit:

Any person interested under a deed, will, contract or other written instrument, or whose rights are affected by a statute, executive order or regulation, ordinance, or any other governmental regulation may, before breach or violation thereof, bring an action in the appropriate Regional Trial Court to determine any question of construction or validity arising, and for a declaration of his rights or duties, thereunder. (Emphasis ours.)As the afore-quoted provision states, a petition for declaratory relief under the first paragraph of Section 1, Rule 63 may be brought before the appropriate RTC.

Section 1, Rule 63 of the Rules of Court further provides in its second paragraph that:

An action for the reformation of an instrument, to quiet title to real property or remove clouds therefrom, or to consolidate ownership under Article 1607 of the Civil Code, may be brought under this Rule. (Emphasis ours.)

The second paragraph of Section 1, Rule 63 of the Rules of Court specifically refers to (1) an action for the reformation of an instrument, recognized under Articles 1359 to 1369 of the Civil Code; (2) an action to quiet title, authorized by Articles 476 to 481 of the Civil Code; and (3) an action to consolidate ownership required by Article 1607 of the Civil Code in a sale with a right to repurchase. These three remedies are considered similar to declaratory relief because they also result in the adjudication of the legal rights of the litigants, often without the need of execution to carry the judgment into effect.

B. Jurisdiction of Section 1, par.2 of Rule 63:

To determine which court has jurisdiction over the actions identified in the second paragraph of Section 1, Rule 63 of the Rules of Court, said provision must be read together with those of the Judiciary Reorganization Act of 1980, as amended.

It is important to note that Section 1, Rule 63 of the Rules of Court does not categorically require that an action to quiet title be filed before the RTC. It repeatedly uses the word "may" that an action for quieting of title "may be brought under [the] Rule" on petitions for declaratory relief, and a person desiring to file a petition for declaratory relief "may x x x bring an action in the appropriate Regional Trial Court." The use of the word "may" in a statute denotes that the provision is merely permissive and indicates a mere possibility, an opportunity or an option.

In contrast, the mandatory provision of the Judiciary Reorganization Act of 1980, as amended, uses the word "shall" and explicitly requires the MTC to exercise exclusive original jurisdiction over all civil actions which involve title to or possession of real property where the assessed value does not exceed P20,000.00.

As found by the RTC, the assessed value of the subject property as stated in Tax Declaration No. 02-48386 is only P410.00; therefore, petitioners Complaint involving title to and possession of the said property is within the exclusive original jurisdiction of the MTC, not the RTC.