Re: In the Matter of Clarification of Exemption from Payment of All Court and Sheriff’s Fees of Cooperatives Duly Registered [A.M. No. 12-2-03-0, March 13, 2012]

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Re: In the Matter of Clarification of Exemption from Payment of All Court and Sheriff’s Fees of Cooperatives Duly Registered

 [A.M. No. 12-2-03-0, March 13, 2012]

EN BANC, PEREZ, J.

 

Cooperatives; Court and Sheriff’s Fees; Rule 141; Judicial Rule-Making Power; Fiscal Autonomy of the Judiciary

 

The statutory exemption granted to cooperatives under Republic Act No. 6938, as amended by Republic Act No. 9520, cannot exempt cooperatives from the payment of legal fees imposed under Rule 141 of the Rules of Court. The authority to promulgate rules on pleading, practice, and procedure—including the imposition, assessment, and collection of legal fees—is vested exclusively in the Supreme Court under Article VIII, Section 5(5) of the 1987 Constitution. Any legislative grant of exemption that diminishes legal fees collected under Rule 141 impairs the Judiciary's constitutionally guaranteed fiscal autonomy and is therefore constitutionally infirm. 

 

Perpetual Help Community Cooperative (PHCCI), a cooperative duly registered under Republic Act No. 9520, filed a petition before the Supreme Court requesting the issuance of an order clarifying and implementing the statutory exemption of cooperatives from the payment of court and sheriff's fees. 

PHCCI relied on Section 6, Article 61 of Republic Act No. 9520, which substantially reproduced the exemption previously granted under Article 62(6) of Republic Act No. 6938. The provision exempts cooperatives from the payment of all court and sheriff's fees payable to the Philippine Government in connection with actions brought under the Cooperative Code or actions instituted by the Cooperative Development Authority to enforce obligations contracted in favor of cooperatives. 

PHCCI alleged that despite this statutory exemption and previous Supreme Court issuances, including A.M. No. 03-4-01-0 and Office of the Court Administrator Circular No. 44-2007, trial courts continued to assess filing fees and other legal fees against cooperatives whenever they instituted judicial actions. It cited its experience before the Municipal Trial Court in Cities of Dumaguete City, where the Executive Judge declined to implement the claimed exemption and advised that the matter be brought before the Supreme Court for a definitive ruling of nationwide application. 

The petition thus squarely presented the question of whether cooperatives remained exempt from the payment of legal fees under Rule 141 of the Rules of Court notwithstanding Republic Act No. 9520. 

 

Whether or not cooperatives duly registered under Republic Act No. 9520 remain exempt from the payment of legal fees and court fees under Rule 141 of the Rules of Court.

NO. The Supreme Court denied the petition and categorically ruled that cooperatives are no longer exempt from the payment of legal fees imposed under Rule 141. 

The Court first clarified that the "court fees" referred to in Republic Act No. 9520 encompass the legal fees imposed under Rule 141, including filing fees, docket fees, appeal fees, mediation fees, sheriff's fees, stenographer's fees, and commissioners' fees. More significantly, the Court held that subsequent jurisprudence had superseded the earlier recognition of statutory exemptions. It relied principally on Re: Petition for Recognition of the Exemption of the Government Service Insurance System (GSIS) from Payment of Legal Fees (A.M. No. 08-2-01-0), where the Court declared that the assessment and collection of legal fees form part of the Supreme Court's constitutional authority to promulgate rules concerning pleading, practice, and procedure. Since the 1987 Constitution removed Congress' former power to repeal, alter, or supplement procedural rules promulgated by the Court, legislative enactments purporting to exempt particular entities from legal fees imposed under Rule 141 may no longer prevail over the Rules of Court. 

The Court likewise reiterated its earlier ruling in Baguio Market Vendors Multi-Purpose Cooperative v. Cabato-Cortes, where it rejected a cooperative's claim of exemption from legal fees in an extrajudicial foreclosure proceeding, and its subsequent Resolution involving the National Power Corporation, where similar legislative exemptions from legal fees were likewise denied. These decisions consistently recognized that the constitutional allocation of powers prevents Congress from modifying procedural rules governing the assessment of legal fees. 

Accordingly, the Court declared that cooperatives may no longer invoke either Republic Act No. 6938 or Republic Act No. 9520 as a basis for exemption from the payment of legal fees imposed under Rule 141. To ensure uniform implementation nationwide, the Court directed the Office of the Court Administrator to issue a circular clarifying that cooperatives are not exempt from the payment of legal fees prescribed under the Rules of Court. Consequently, the petition of PHCCI was DENIED.

 


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