by IVYAILEEN ALAYAY

MARIA VELASQUEZ v. WILLIAM GEORGE, GR No. 62376, 1983-10-27

Facts:

Plaintiffs-appellants

Maria Velasquez Vda. de George and her children

The plaintiffs-appellants are the widow and legitimate children of the late Benjamin B. George whose estate is under intestate proceedings.

In their complaint... alleged that the five defendants-mortgagors are officers of the Island Associates Inc. Andres Muñoz, aside from being the treasurer-director of said corporation, was also appointed and qualified as administrator of... the estate of Benjamin George in the above special proceedings

W... ithout the proper approval from the probate court and without notice to the heirs and their... counsel, the defendants-mortgagors executed a Deed of First Real Estate Mortgage in favor of the defendant-mortgagee Erlinda Villanueva, covering three parcels of land owned by Island Associates.

A certificate of sale was executed in favor of Villanueva by the Provincial Sheriff of Bulacan after she submitted the highest bids at the public auction. This led to the execution of a Deed of Sale and Affidavit of Consolidation of Ownership by virtue of which

Transfer Certificates of Titles... were issued in favor of Villanueva.

The plaintiffs-appellants, therefore, filed the... complaint for the annulment of the - 1.) Deed of First Real Estate Mortgage; 2.) Power of Attorney; 3.) Certificate of Sale; 4.) Amended Certificate of Sale; 5.)

Affidavit of Consolidation of Ownership; and 6.) Transfer Certificates of Title

Issues:

Whether or not the mortgage contract, with an unusual provision whereby the mortgagors waived their right to redeem the mortgaged property, could be executed without proper approval of the probate court and without notice to the widow and legitimate children of the deceased... is a matter clearly within the authority of a trial court to decide.

Ruling:

We agree with the plaintiffs-appellants. What the complaint sought to annul were documents of title which vested ownership over the three parcels of land in question to defendant-mortgagee Villanueva, who is neither an officer, a stockholder nor a director of the corporation,... but a third party. Clearly, the lower court had jurisdiction over the controversy. The fact that the plaintiffs-appellants subsequently questioned the legality of the constitution of the board of directors of the cor­poration did not divest the court of its jurisdiction to take... cognizance of the case. What determines jurisdiction of the court are the allegations in the complaint. If from the same, the court has already acquired jurisdiction over the subject-matter, jurisdiction is retained up to the end of the litigation.

Principles: