Shari’ah courts are autonomous bodies which do not need to lean on civil courts.

Thus ruled the Supreme Court En Banc, through Associate Justice Rodil V. Zalameda, in its Decision granting the consolidated petitions filed under Rule 45 of the Rules of Court by Annielyn Dela Cruz Maliga (Annielyn) and Dr. John O. Maliga (John). The petitions challenged the orders of the 5th Shari’ah District Court (SDC), Cotabato City dismissing their complaints involving contracts of loan with interest.

The complaints were filed by Annielyn and John (collectively, petitioners) with the SDC following successive demands for payments by respondents Dimasurang Unte, Jr. (Unte) and Abraham N. Tingao and Bai Shor Tingao (Spouses Tingao) over loans contracted by Annielyn with the respondents. Pursuant to said loans, Annielyn had paid Unte PhP8,660,250 for interests alone, despite the principal amount of her loan being only PhP1,965,000. Annielyn had also paid Spouses Tingao PhP1,452,000 on interest alone despite the principal amount being only PhP330,000.

The petitioners thus prayed in their complaints for the extinguishment of the loans and for the refund or restitution by the respondents of all overpayments.

The SDC, holding that it lacked jurisdiction over the subject matter of the complaint since it involves the application of the Usury Law, dismissed the complaints. This prompted Annielyn and John to file the present petitions before the Supreme Court.

In granting the petitions, the Court first stressed that to determine which court has jurisdiction over an action, an examination of the complaint is essential. The nature of an action, and which court or body has jurisdiction over it, is determined based on the allegations in the complaint, regardless if the plaintiff is entitled to recover upon all or some of the asserted claims.

In the case of SDCs, Article 143(1)(d) of Presidential Decree No. 1083 or the Code of Muslim Personal Laws of the Philippines (the Muslim Code) provides that SDCs have exclusive original jurisdiction over, among others, all actions arising from customary contracts where the parties are Muslims, if they have not specified which law shall govern their relations.

Article 143(2)(b) of the same law further states that SDCs have original jurisdiction, concurrent with existing civil courts, over all other personal and real actions not mentioned in Article 143(1)(d), where the parties are Muslims, except those for forcible entry and unlawful detainer. In effect, this acts as a catch-all provision that primarily hinges on the jurisdiction of the parties involved, and does not limit the SDCs’ jurisdiction to specific kinds of action. Thus, regardless of the subject matter of the action, the SDC may exercise jurisdiction so long as the parties are Muslims.

“By including a catch-all provision on all personal and real actions, the law clearly intended the SDCs to be self-sufficient adjudicatory bodies able to effectively resolve any dispute between and among Muslims,” said the Court. It also stressed that SDCs are equipped with the same capabilities as civil courts, with SDC judges possessing specific expertise in Muslim law and customary law.

This policy direction is further amplified in Republic Act No. (RA) 11054 or the Organic Law for the Bangsamoro Autonomous Region in Muslim Mindanao, which vested SDCs with exclusive original jurisdiction over all other personal and real actions involving Muslims. Thus, actions where the SDC had concurrent jurisdiction with civil courts are now considered within the exclusive and original jurisdiction of the SDCs in the Bangsamoro Autonomous Region. This applies prospectively as the law did not provide for retroactive application.

In the present case, the complaints were filed prior to the effectivity of RA 11054. Hence, the Muslim Code remains the applicable law regarding jurisdiction, in accordance with the principle that jurisdiction, once acquired, is retained until the end of litigation.

Applying the foregoing principles to the present case, the Court ruled that the SDC erred in dismissing the case based merely on a perceived lack of applicable Muslim law.

“[The Muslim Code] does not limit the SDC’s jurisdiction to actions involving the application of this law’s provisions. On the contrary, the catch-all provision grants SDCs jurisdiction over nearly all personal and real actions between Muslims,” said the Court.

Further, even assuming that the case would require application of certain civil law concepts and other special laws, the dispute must still be resolved by the SDC. The fact that there is no applicable provision in the Muslim Code does not mean there is no relevant Muslim law to settle the dispute. “The SDC failed to consider that [the Muslim Code] only codified Muslim personal laws, i.e. laws applicable to personal and family matters such as civil personality, marriage and divorce, paternity and filiation, parental authority, support, and succession,” said the Court.

In addition, under Article 5 of the Muslim Code, the parties can point to a relevant Muslim law, not expressly stated in the Muslim Code, which must be proved in evidence as a fact. Reiterating the Court’s ruling in the 2018 case of Mangondaya v. Ampaso, the Court held that questions on whether the customary law or ‘äda exists and whether it applies to the parties’ situation are questions of fact. 

In the present case, since the parties have not yet undergone pre-trial nor shown evidence on the applicable law, it was premature for the SDC to immediately rule that Muslim law prohibits the transactions, the Court ruled. As the existence of such prohibition and its effect on Annielyn’s ability to recover overpayments are questions of fact, relevant evidence must be received.

Further, the Court pointed out that the petitioners, in praying for a reimbursement of their alleged excess payments to respondents, invoked the Last Sermon, where the Prophet Muhammad echoed a portion of the Qur’an, the ultimate source of Shari’ah, which proscribes riba or the receipt and payment of interest.