19 Sun Insurance Office LTD V Asuncion

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274 SUPREME COURT REPORTS ANNOTATED


Sun Insurance Office, Ltd., (SIOL) vs. Asuncion

*
G.R. Nos. 79937-38. February 13, 1989.

SUN INSURANCE OFFICE, LTD., (SIOL), E.B. PHILIPPS


AND D.J. WARBY, petitioners, vs. HON. MAXIMIANO C.
ASUNCION, Presiding Judge, Branch 104, Regional Trial
Court, Quezon City and MANUEL CHUA UY PO TIONG,
respondents.

Remedial Law; Civil Procedure; Actions; Statutes regulating


the procedure of courts are applicable to actions pending and
undetermined at the time of their passage.—On the other hand,
private respondent claims that the ruling in Manchester cannot
apply retroactively to Civil Case No. Q-41177 for at the time said
civil case was filed in court there was no such Manchester ruling
as yet. Further, private respondent avers that what is applicable
is the ruling of this Court in Magaspi v. Ramolete, wherein this
Court held that the trial court acquired jurisdiction over the case
even if the docket fee paid was insufficient. The contention that
Manchester cannot apply retroactively to this case is untenable.
Statutes regulating the procedure of the courts will be construed
as applicable to actions pending and undetermined at the time of
their passage. Procedural laws are retrospective in that sense and
to that extent.
Same; Same; Same; Jurisdiction; Complaint; Docket Fees; It
is not only the filing of the complaint, but the payment of the
prescribed docket fee, that vests a trial court with jurisdiction over
the subject matter or nature of the action.—It is not simply the
filing 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. Where
the filing of the initiatory pleading is not accompanied by
payment of the docket fee,

_______________

* EN BANC.

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Sun Insurance Office, Ltd., (SIOL) vs. Asuncion

the court may allow payment of the fee within a reasonable time
but in no case beyond the applicable prescriptive or reglementary
period.
Same; Same; Same; Same; Same; Same; Permissive Counter-
claims; Third-Party Claims; Permissive counter-claims, third-
party claims and the like shall not be considered filed until and
unless the prescribed filing fee is paid.—The same rule applies to
permissive counterclaims, third-party claims and similar
pleadings, which shall not be considered filed until and unless the
filing fee prescribed therefor is paid. The court may also allow
payment of said fee within a reasonable time but also in no case
beyond its applicable prescriptive or reglementary period.
Same; Same; Same; Same; Same; Same; Judgments; Lien;
When the judgment of the courts awards a claim not specified in
the pleading, the additional filing fee shall constitute a lien on the
judgment.—Where the trial court acquires jurisdiction over a
claim by the filing of the appropriate pleading and payment of the
prescribed filing fee but, subsequently, the judgment awards a
claim not specified in the pleading, or if specified the same has
been left for determination by the court, the additional filing fee
therefor shall constitute a lien on the judgment. It shall be the
responsibility of the Clerk of Court or his duly authorized deputy
to enforce said lien and assess and collect the additional fee.

PETITION to review the decision of the Court of Appeals.

The facts are stated in the opinion of the Court.


          Romulo, Mabanta, Buenaventura, Sayoc & De los
Angeles Law Offices for petitioners.
     Tanjuatco, Oreta, Tanjuatco, Berenguer & Sanvicente
Law Offices for private respondent.

GANCAYCO, J.:

Again the Court is asked to resolve the issue of whether or


not a court acquires jurisdiction over a case when the
correct and proper docket fee has not been paid.
On February 28, 1984, petitioner Sun Insurance Office,
Ltd. (SIOL for brevity) filed a complaint with the Regional
Trial Court of Makati, Metro Manila for the consignation of

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a premium refund on a fire insurance policy with a prayer


for the
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Sun Insurance Office, Ltd., (SIOL) vs. Asuncion

judicial declaration of its nullity against private respondent


Manuel Uy Po Tiong. Private respondent was declared in
default for failure to file the required answer within the
reglementary period.
On the other hand, on March 28, 1984, private
respondent filed a complaint in the Regional Trial Court of
Quezon City for the refund of premiums and the issuance of
a writ of preliminary attachment which was docketed as
Civil Case No. Q-41177, initially against petitioner SIOL,
and thereafter including E.B. Philipps and D.J. Warby as
additional defendants. The complaint sought, among
others, the payment of actual, compensatory, moral,
exemplary and liquidated damages, attorney’s fees,
expenses of litigation and costs of the suit. Although the
prayer in the complaint did not quantify the amount of
damages sought said amount may be inferred from the
body of the complaint to be about Fifty Million Pesos
(P50,000,000.00).
Only the amount of P210.00 was paid by private
respondent as docket fee which prompted petitioners’
counsel to raise his objection. Said objection was
disregarded by respondent Judge Jose P. Castro who was
then presiding over said case.
Upon the order of this Court, the records of said case
together with twenty-two other cases assigned to different
branches of the Regional Trial Court of Quezon City which
were under investigation for under-assessment of docket
fees were transmitted to this Court. The Court thereafter
returned the said records to the trial court with the
directive that they be reraffled to the other judges in
Quezon City, to the exclusion of Judge Castro. Civil Case
No. Q-41177 was re-raffled to Branch 104, a sala which was
then vacant.
On October 15, 1985, the Court en banc issued a
Resolution in Administrative Case No. 85-10-8752-RTC
directing the judges in said cases to reassess the docket
fees and that in case of deficiency, to order its payment.
The Resolution also requires all clerks of court to issue
certificates of re-assessment of docket fees. All litigants

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were likewise required to specify in their pleadings the


amount sought to be recovered in their complaints.
On December 16, 1985, Judge Antonio P. Solano, to
whose sala Civil Case No. Q-41177 was temporarily
assigned, issued

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Sun Insurance Office, Ltd., (SIOL) vs. Asuncion

an order to the Clerk of Court instructing him to issue a


certificate of assessment of the docket fee paid by private
respondent and, in case of deficiency, to include the same
in said certificate.
On Jaunary 7, 1984, to forestall a default, a cautionary
answer was filed by petitioners. On August 30, 1984, an
amended complaint was filed by private respondent
including the two additional defendants aforestated.
Judge Maximiano C. Asuncion, to whom Civil Case No.
Q-41177 was thereafter assigned, after his assumption into
office on January 16, 1986, issued a Supplemental Order
requiring the parties in the case to comment on the Clerk
of Court’s letter-report signifying her difficulty in
complying with the Resolution of this Court of October 15,
1985 since the pleadings filed by private respondent did not
indicate the exact amount sought to be recovered. On
January 23, 1986, private respondent filed a “Compliance”
and a “Re-Amended Complaint” stating therein a claim of
“not less than P10,000,000.00 as actual compensatory
damages” in the prayer. In the body of the said second
amended complaint however, private respondent alleges
actual and compensatory damages and attorney’s fees in
the total amount of about P44,601,623.70.
On January 24, 1986, Judge Asuncion issued another
Order admitting the second amended complaint and
stating therein that the same constituted proper
compliance with the Resolution of this Court and that a
copy thereof should be furnished the Clerk of Court for the
reassessment of the docket fees. The reassessment by the
Clerk of Court based on private respondent’s claim of “not
less than P10,000,000.00 as actual and compensatory
damages” amounted to P39,786.00 as docket fee. This was
subsequently paid by private respondent.
Petitioners then filed a petition for certiorari with the
Court of Appeals questioning the said order of Judge
Asuncion dated January 24, 1986.

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On April 24, 1986, private respondent filed a


supplemental complaint alleging an additional claim of
P20,000,000.00 as damages so the total claim amounts to
about P64,601,623.70. On October 16, 1986, or some seven
months after filing the supplemental complaint, the private
respondent paid the addi-
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Sun Insurance Office, Ltd., (SIOL) vs. Asuncion

1
tional docket fee of P80,396.00.
On August 13, 1987, the Court of Appeals rendered a
decision ruling, among others, as follows:

“WHEREFORE, judgment is hereby rendered:


1. Denying due course to the petition in CA-G.R. SP No. L-
09715 insofar as it seeks annulment of the order

(a) denying petitioners’ motion to dismiss the complaint, as


amended, and
(b) granting the writ of preliminary attachment, but giving
due course to the portion thereof questioning the
reassessment of the docketing fee, and requiring the
Honorable respondent Court to reassess the docketing fee
to be paid by private respondent
2
on the basis of the
amount of P25,401,707.00.”

Hence, the instant petition.


During the pendency of this petition and in conformity
with the said judgment of respondent court, private
respondent paid 3
the additional docket fee of P62,432.90 on
April 28, 1988.
The main thrust of the petition is that the Court of
Appeals erred in not finding that the lower court did not
acquire jurisdiction over Civil Case No. Q-41177 on the
ground of non-payment of the correct and proper docket fee.
Petitioners allege that while it may be true that private
respondent had paid the amount of P182,824.90 as docket
fee as herein-above related, and considering that the total
amount sought to be recovered in the amended and
supplemental complaint is P64,601,623.70 the docket fee
that should be paid by private respondent is P257,810.49,
more or less. Not having paid the same, petitioners contend
that the complaint should be dismissed and all incidents
arising therefrom should be annulled. In support of their

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theory, petitioners cite the latest ruling of4 the Court in


Manchester Development Corporation vs. CA, as follows:

_______________

1 Annexes 1,1-A, 1-B of Comment of private respondent.


2 Page 34, Decision of the Court of Appeals; p. 57 Rollo.
3 Annex 2 to Memorandum of private respondent.
4 149 SCRA 562 (1987).

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Sun Insurance Office, Ltd., (SIOL) vs. Asuncion

“The Court acquires jurisdiction over any case only upon the
payment of the prescribed docket fee. An amendment of the
complaint or similar pleading will not thereby vest jurisdiction in
the Court, much less the payment of the docket fee based on the
amounts sought in the amended pleading. The ruling in the
Magaspi Case in so far as it is inconsistent with this
pronouncement is overturned and reversed.”

On the other hand, private respondent claims that the


ruling in Manchester cannot apply retroactively to Civil
Case No. Q-41177 for at the time said civil case was filed in
court there was no such Manchester ruling as yet. Further,
private respondent avers that what is applicable
5
is the
ruling of this Court in Magaspi v. Ramolete, wherein this
Court held that the trial court acquired jurisdiction over
the case even if the docket fee paid was insufficient.
The contention that Manchester cannot apply
retroactively to this case is untenable. Statutes regulating
the procedure of the courts will be construed as applicable
to actions pending and undetermined at the time of their
passage. Procedural6
laws are retrospective in that sense
and to that extent. 7
In Lazaro vs. Endencia and Andres, this Court held that
the payment of the full amount of the docket fee is an
indispensable step for the perfection of an appeal. In a
forcible entry and detainer case before the justice of the
peace court of Manaoag, Pangasinan, after notice of a
judgment dismissing the case, the plaintiff filed a notice of
appeal with said court but he deposited only P8.00 for the
docket fee, instead of P16.00 as required, within the
reglementary period of appeal of five (5) days after
receiving notice of judgment. Plaintiff deposited the
additional P8.00 to complete the amount of the docket fee
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only fourteen (14) days later. On the basis of these facts,


this court held that the Court of First Instance did not

_______________

5 115 SCRA 193, 204 (1982).


6 People vs. Sumilang, 77 Phil. 764 (1946); Alday vs. Camilon, 120
SCRA 521 (1983) and Paterno Building Tenants Association, Inc. vs.
Intermediate Appellate Court, 133 SCRA 168 (1984).
7 57 Phil. 552 (1932).

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Sun Insurance Office, Ltd., (SIOL) vs. Asuncion

acquire jurisdiction to hear and determine the appeal as


the appeal was not thereby 8
perfected.
In Lee vs. Republic, the petitioner filed a verified
declaration of intention to become a Filipino citizen by
sending it through registered mail to the Office of the
Solicitor General in 1953 but the required filing fee was
paid only in 1956, barely 5-1/2 months prior to the filing of
the petition for citizenship. This Court ruled that the
declaration was not filed in accordance with the legal
requirement that such declaration should be filed at least
one year before the filing of the petition for citizenship.
Citing Lazaro, this Court concluded that the filing of
petitioner’s declaration of intention on October 23, 1953
produced no legal effect until the required filing fee was
paid on May 23, 1956. 9
In Malimit vs. Degamo, the same principles enunciated
in Lazaro and Lee were applied. It was an original petition
for quo warranto contesting the right to office of proclaimed
candidates which was mailed, addressed to the clerk of the
Court of First Instance, within the one-week period
10
after
the proclamation as provided therefor by law. However,
the required docket fees were paid only after the expiration
of said period. Consequently, this Court held that the date
of such payment must be deemed to be the real date of
filing of aforesaid petition and not the date when it was
mailed. 11
Again, in Garica vs. Vasquez, this Court reiterated the
rule that the docket fee must be paid before a court will act
on a petition or complaint. However, we also held that said
rule is not applicable when petitioner seeks the probate of
several wills of the same decedent as he is not required to
file a separate action for each will but instead he may have
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other wills probated in the same special proceeding then


pending before the same
12
court.
Then in Magaspi, this Court reiterated the ruling in
Mal-

_______________

8 10 SCRA 65 (1964).
9 12 SCRA 450 (1964).
10 Section 173, Revised Election Code.
11 28 SCRA 3301 (1969).
12 Supra.

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imit and Lee that a case is deemed filed only upon payment
of the docket fee regardless of the actual date of its filing in
court. Said case involved a complaint for recovery of
ownership and possession of a parcel of land with damages
filed in the Court of First Instance of Cebu. Upon the
payment of P60.00 for the docket fee and 10.00 for the
sheriffs fee, the complaint was docketed as Civil Case No.
R-11882. The prayer of the complaint sought that the
Transfer Certificate of Title issued in the name of the
defendant be declared as null and void. It was also prayed
that plaintiff be declared as owner thereof to whom the
proper title should be issued, and that defendant be made
to pay monthly rentals of P3,500.00 from June 2, 1948 up
to the time the property is delivered to plaintiff,
P500,000.00 as moral damages, attorney’s fees in the
amount of P250,000.00, the costs of the action and
exemplary damages in the amount ofP500,000.00.
The defendant then filed a motion to compel the plaintiff
to pay the correct amount of the docket fee to which an
opposition was filed by the plaintiff alleging that the action
was for the recovery of a parcel of land so the docket fee
must be based on its assessed value and that the amount of
P60.00 was the correct docketing fee. The trial court
ordered the plaintiff to pay P3,l04.00 as filing fee.
The plaintiff then filed a motion to admit the amended
complaint to include the Republic as the defendant. In the
prayer of the amended complaint the exemplary damages
earlier sought was eliminated. The amended prayer merely
sought moral damages as the court may determine,
attorney’s fees of P100,000.00 and the costs of the action.
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The defendant filed an opposition to the amended


complaint. The opposition notwithstanding, the amended
complaint was admitted by the trial court. The trial court
reiterated its order for the payment of the additional docket
fee which plaintiff assailed and then challenged before this
Court. Plaintiff alleged that he paid the total docket fee in
the amount of P60.00 and that if he has to pay the
additional fee it must be based on the amended complaint.
The question posed, therefore, was whether or not the
plaintiff may be considered to have filed the case even if
the docket-

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Sun Insurance Office, Ltd., (SIOL) vs. Asuncion

ing fee paid was not sufficient. In Magaspi, We reiterated


the rule that the case was deemed filed only upon the
payment of the correct amount for the docket fee regardless
of the actual date of the filing of the complaint; that there
was an honest difference of opinion as to the correct
amount to be paid as docket fee in that as the action
appears to be one for the recovery of property the docket fee
of P60.00 was correct; and that as the action is also one for
damages, We upheld the assessment of the additional
docket fee based on the damages alleged in the amended
complaint as against the assessment of the trial court
which was based on the damages alleged in the original
complaint.
However, as aforecited, this Court overturned Magaspi
in Manchester. Manchester involves an action for torts and
damages and specific performance with a prayer for the
issuance of a temporary restraining order, etc. The prayer
in said case is for the issuance of a writ of preliminary
prohibitory injunction during the pendency of the action
against the defendants’ announced forfeiture of the sum of
P3 Million paid by the plaintiffs for the property in
question, the attachment of such property of defendants
that may be sufficient to satisfy any judgment that may be
rendered, and, after hearing, the issuance of an order
requiring defendants to execute a contract of purchase and
sale of the subject property and annul defendants’ illegal
forfeiture of the money of plaintiff. It was also prayed that
the defendants be made to pay the plaintiff, jointly and
severally, actual, compensatory and exemplary damages as
well as 25% of said amounts as may be proved during the
trial for attorney’s fees. The plaintiff also asked the trial
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court to declare the tender of payment of the purchase price


of plaintiff valid and sufficient for purposes of payment,
and to make the injunction permanent. The amount of
damages sought is not specified in the prayer although the
body of the complaint alleges the total amount of over P78
Millon allegedly suffered by plaintiff.
Upon the filing of the complaint, the plaintiff paid the
amount of only P410.00 for the docket fee based on the
nature of the action for specific performance where the
amount involved is not capable of pecuniary estimation.
However, it was obvious
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from the allegations of the complaint as well as its


designation that the action was one for damages and
specific performance. Thus, this court held the plaintiff
must be assessed the correct docket fee computed against
the amount of damages of about P78 Million, although the
same was not spelled out in the prayer of the complaint.
Meanwhile, plaintiff through another counsel, with
leave of court, filed an amended complaint on September
12, 1985 by the inclusion of another co-plaintiff and
eliminating any mention of the amount of damages in the
body of the complaint. The prayer in the original complaint
was maintained.
On October 15, 1985, this Court ordered the re-
assessment of the docket fee in the said case and other
cases that were investigated. On November 12, 1985, the
trial court directed the plaintiff to rectify the amended
complaint by stating the amounts which they were asking
for. This plaintiff did as instructed. In the body of the
complaint the amount of damages alleged was reduced to
P10,000,000.00 but still no amount of damages was
specified in the prayer. Said amended complaint was
admitted.
Applying the principle in Magaspi that “the case is
deemed filed only upon payment of the docket fee
regardless of the actual date of filing in court,” this Court
held that the trial court did not acquire jurisdiction over
the case by payment of only P410.00 for the docket fee.
Neither can the amendment of the complaint thereby vest
jurisdiction upon the Court. For all legal purposes there
was no such original complaint duly filed which could be
amended. Consequently, the order admitting the amended
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complaint and all subsequent proceedings and 13actions


taken by the trial court were declared null and void.
The present case, as above discussed, is among the
several cases of under-assessment of docket fee which were
investigated by this Court together with Manchester. The
facts and circumstances of this case are similar to
Manchester. In the body of the original complaint, the total
amount of damages sought amounted to about P50 Million.
In the prayer, the amount of damages asked for was not
stated. The action was

_______________

13 Supra, pp. 567-568.

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for the refund of the premium and the issuance of the writ
of preliminary attachment with damages. The amount of
only P210.00 was paid for the docket fee. On January 23,
1986, private respondent filed an amended complaint
wherein in the prayer it is asked that he be awarded no
less than P10,000,000.00 as actual and exemplary damages
but in the body of the complaint the amount of his
pecuniary claim is approximately P44,601,623.70. Said
amended complaint was admitted and the private
respondent was reassessed the additional docket fee of
P39,786.00 based on his prayer of not less than
P10,000,000.00 in damages, which he paid.
On April 24, 1986, private respondent filed a
supplemental complaint alleging an additional claim of
P20,000,000.00 in damages so that his total claim is
approximately P64,601,620.70. On October 16, 1986,
private respondent paid an additional docket fee of
P80,396.00. After the promulgation of the decision of the
respondent court on August 31, 1987 wherein private
respondent was ordered to be reassessed for additional
docket fee, and during the pendency of this petition, and
after the promulgation of Manchester, on April 28, 1988,
private respondent paid an additional docket fee of
P62,132.92. Although private respondent appears to have
paid a total amount of P182,824.90 for the docket fee
considering the total amount of his claim in the amended
and supplemental complaint amounting to about

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P64,601,620.70, petitioner insists that private respondent


must pay a docket fee of P257,810.49.
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 filing of the original complaint but also in the filing
of the second amended complaint.
However, in Manchester, petitioner did not pay any
additional docket fee untill 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

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Sun Insurance Office, Ltd., (SIOL) vs. Asuncion

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 influence 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.
Nevertheless, petitioners contend that the docket fee
that was paid is still insufficient considering the total
amount of the claim. This is a matter which the clerk of
court of the lower court and/or his duly authorized docket
clerk or clerk in-charge should determine and, thereafter, if
any amount is found due, he must require the private
respondent to pay the same. Thus, the Court rules as
follows:

1. It is not simply the filing 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. Where the filing of the initiatory
pleading is not accompanied by payment of the
docket fee, the court may allow payment of the fee
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within a reasonable time but in no case beyond the


applicable prescriptive or reglementary period.
2. The same rule applies to permissive counterclaims,
third-party claims and similar pleadings, which
shall not be considered filed until and unless the
filing fee prescribed therefor is paid. The court may
also allow payment of said fee within a reasonable
time but also in no case beyond its applicable
prescriptive or reglementary period.
3. Where the trial court acquires jurisdiction over a
claim by the filing of the appropriate pleading and
payment of the prescribed filing fee but,
subsequently, the judgment awards a claim not
specified in the pleading, or if specified the same
has been left for determination by the court, the
additional filing fee therefor shall constitute a lien
on the judgment. It shall be the responsibility of the
Clerk of Court or his duly authorized deputy to
enforce said lien and assess and collect the
additional fee.

WHEREFORE, the petition is DISMISSED for lack of


merit.

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286 SUPREME COURT REPORTS ANNOTATED


Ang vs. Court of Appeals

The Clerk of Court of the court a quo is hereby instructed


to reassess and determine the additional filing fee that
should be paid by private respondent considering the total
amount of the claim sought in the original complaint and
the supplemental complaint as may be gleaned from the
allegations and the prayer thereof and to require private
respondent to pay the deficiency, if any, without
pronouncement as to costs.
SO ORDERED.

     Fernan (C.J), Narvasa, Melencio-Herrera, Gutierrez,


Jr., Cruz, Paras, Feliciano, Padilla, Bidin, Sarmiento,
Cortes, Griño-Aquino, Medialdea and Regalado, JJ.,
concur.

Petition dismissed.

Note.—Court acquires jurisdiction over any case only


upon payment of the prescribed docket fee. An amendment
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of the complaint or similar pleading will not vest


jurisdiction in the court, much less payment of the docket
fee based on amount in the amended pleading. (Manchester
Development Corporation vs. Court of Appeals, 149 SCRA
562.)

——o0o——

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