Whether failure to specify the sum of exemplary damages in a complaint warrants its dismissal under the Manchester Development Corporation ruling and…
Summary
The Supreme Court reversed a trial court's dismissal of a collection suit where petitioners failed to specify the amount of exemplary damages sought. The Court distinguished this case from Manchester Development Corporation, ruling that failure to specify exemplary damages is not fatal when the complaint contains sufficient specified sums for actual damages to enable computation of docket fees. The Court emphasized that exemplary damages are discretionary under the Civil Code and cannot be recovered as a matter of right, with their amount determinable during trial. Since this was essentially a specific performance case for a loan contract with clearly specified actual damages (principal, interest, attorney's fees), the unspecified exemplary damages did not warrant dismissal. The Manchester doctrine should only apply where there is a clear attempt to defraud the government through fee evasion.
Focus of dispute
Whether failure to specify the sum of exemplary damages in a complaint warrants its dismissal under the Manchester Development Corporation ruling and Circular No. 7
Legal facts
Petitioners Spouses Belen Gregorio filed a collection suit against private respondents Spouses Sylvia and Ramon Carrion for a P100,000.00 loan with 12% annual interest. The first complaint (Civil Case No. 18058, RTC Branch 137) was dismissed for failure to appear at pre-trial. A second complaint (Civil Case No. 88-159, RTC Branch 58) was filed with identical prayers, including exemplary damages 'subject to the discretion of the Honorable Court' without specifying the amount. Private respondents moved to dismiss based on Manchester Development Corporation v. Court of Appeals and Administration Circular No. 7, arguing that failure to specify exemplary damages amount violated pleading requirements.
Judgement and reasoning
{"Regional Trial Court, Branch 137, Makati": "Dismissed the first complaint due to petitioners' failure to appear at pre-trial conference and to file a pre-trial brief.", "Regional Trial Court, Branch 58, Makati": "Initially denied the motion to dismiss for failure to prosecute. Subsequently granted the motion to dismiss and/or expunge complaint, ruling that failure to specify the amount of exemplary damages violated Administration Circular No. 7 and the Manchester Development Corporation precedent.", "Supreme Court (SC)": "Reversed the trial court's dismissal, holding that failure to specify exemplary damages amount is not fatal where the complaint specifies sufficient sums for actual damages to enable computation of docket fees. Distinguished the case from Manchester, noting this was essentially a demand for specific performance of a loan contract with specified actual damages (P100,000 principal, P52,000 attorney's fees, P108,000 interest, P10,000 litigation expenses). Emphasized that exemplary damages are discretionary under Article 2233 of the Civil Code and their amount need not be proved with certainty. The court can assess docket fees based on actual damages sought, and Manchester should only apply where there is clear attempt to defraud the government."}