Republic of the PhilippinesSUPREME COURTManila FIRST DIVISION

started exercising illegal possession of said portion of land which contains an area of 200 1 square meters, more or less. On 7 November 1972 the City Court of Olongapo City, Br. 4, dismissed Civil Case No. 926 on the ground that "it appears to the Court that the Bureau of Lands has considered 3 the area in question to be outside Lot 1641 of the plaintiff. . . ." The Decision of the City Court of Olongapo City became final and executory on 30 April 1973 when the then 4 Court of First Instance of Zambales and Olongapo City, Br. 3, dismissed the appeal and affirmed the findings and conclusions of the City Court holding that appellant (herein petitioner) failed to give sufficient evidence to prove that the area in question was 5 within the boundaries of Lot No. 1641. Subsequently, on 17 December 1973, petitioner was granted Miscellaneous Sales Patent No. 5548 and issued Original Certificate of Title No. P-3259 covering Lot No. 1641. Meanwhile, Ben Babol who was the defendant and appellee in the complaint for forcible entry had sold the property he was occupying, including the portion of about 200 square meters in question, to a certain Reino Rosete. Thus petitioner demanded the surrender of the same area in dispute from Reino Rosete who repeatedly refused to comply with the demand. On 29 June 1977, or after about four (4) years from the finality of the dismissal of Civil Case No. 926, petitioner instituted a complaint for quieting of title and recovery of possession with damages against Ben Babol and Reino Rosete before the then Court of First Instance of Zambales and Olongapo City, docketed as Civil Case No. 2203-0, alleging in pars. 2 and 3 therein that . . . plaintiff is the absolute owner in fee simple of a parcel of land identified as Lot No. 1641, Ts-308, Olongapo Townsite Subdivision . . . covered by Original Certificate of Title No. P-3259, issued by the Register of Deeds for the province of Zambales. . . . Sometime in December,1970, and until present, defendants, relying on an application filed on December 23, 1969, with the Bureau of Lands, however have squatted, illegally occupied and unlawfully possessed the southwestern portion of plaintiff's abovedescribed property of about 200 square meters, then by defendant BEN BABOL and now by defendant REINO ROSETE, the former having sold the entirety of his property to the 6 latter, including the portion in question. . . . Instead of filing a responsive pleading, therein defendant Reino Rosete (private respondent herein) moved to dismiss the complaint on the ground of res judicata. Defendant Ben Babol did not file any pleading. In its Order dated 27 January 1978, the then Court of First Instance of Zambales, Br. 1, sustained the argument of Rosete and granted his motion to dismiss. Thereafter, 9 petitioner's motion for reconsideration was denied. Hence, this petition for review on certiorari.
7 8 2

G.R. No. L-48050 October 10, 1994 FELICIDAD JAVIER, petitioner, vs.HON. REGINO T. VERIDIANO II, Presiding Judge, Branch I, Court of First Instance of Zambales and REINO ROSETE, respondents. Cesar E. Palma for petitioner. Saturnino V. Bactad for private respondent.

BELLOSILLO, J.: Petitioner Felicidad Javier questions before us the order of a regional trial court citing the final decision of the city court previously dismissing her complaint for forcible entry, and on the basis thereof, dismissed her petition to quiet title on the ground of res judicata. We summon the time-honored remedies accion interdictal, accion publiciana and accion reivindicatoria or accion de reivindicacion to resolve the issues presented in the petition. It appears that on 25 January 1963, petitioner filed a Miscellaneous Sales Application for Lot No. 1641, Ts-308 of the Olongapo Townsite Subdivision, Lower Kalaklan, Olongapo City, with the District Land Officer, Bureau of Lands, Olongapo City. Sometime in December 1970, alleging that she was forcibly dispossessed of a portion of the land by a certain Ben Babol, she instituted a complaint for forcible entry before the City Court of Olongapo City, docketed as Civil Case No. 926, stating in pars. 2 and 3 therein that . . . plaintiff is the true, lawful and in actual, prior physical possession of a certain parcel of land situated at Lower Kalaklan, City of Olongapo, said lot being designated as Lot No. 1641, Ts-308 of the Olongapo Townsite Subdivision since 1961 and up to the present time, until the day and incidents hereinafter narrated. . . . Sometime on December 12, 1970, the defendant, without express consent of plaintiff and without lawful authority, through scheme, strategy and stealth, forcibly entered a portion on the southwestern part of Lot No. 1641, Ts-308, with the assistance of hired helpers, started construction of riprap along the Kalaklan River perimeter of said portion of land; said entry was further augmented by removing plaintiff's chain link, fence with galvanized iron posts embedded in concrete, likewise destroying plants introduced by plaintiff by removing existing BL (Bureau of Lands) monuments thereon, and by these actions, defendant

Petitioner contends that res judicata cannot apply in the instant case since there is no identity of parties and causes of action between her complaint for forcible entry, which had long become final and executory, and her subsequent petition for quieting of title. She argues that private respondent Reino Rosete, who invokes the defense or res judicata, was never impleaded in the forcible entry case, which is an action in personam; neither was he a purchaser pendente lite who, perhaps, could have validly invoked the defense of res judicata. With regard to the cause of action, she maintains that there is no identity of causes of action since the first case was for forcible entry, which is merely concerned with the possession of the property, whereas the subsequent case was for quieting of title, which looks into the ownership of the disputed land. Private respondent however submits that there is identity of parties in the two cases since he is a successor in interest by title of the defendant in the first case after the commencement of the first action. On the issue of identity of causes of action, he simply states that neither of the two cases, i.e., the complaint for forcible entry and the subsequent petition for quieting of title, alleges a cause of action. Thus, private respondent continues, both cases have to be dismissed. Time and again it has been said that for res judicata to bar the institution of a subsequent action the following requisites must concur: (1) There must be a final judgment or order; (2) The court rendering the judgment must have jurisdiction over the subject matter; (3) The former judgment is a judgment on the merits; and, (4) There is between the first and second actions identity of parties, of subject matter and of causes 10 of action. The presence of the first three requirements and the identity of subject matter in the fourth requirement are not disputed. Hence, the only issues remaining are whether as between Civil Case No. 926 and Civil Case No. 2203-0 there is identity of parties and of causes of action which would bar the institution of Civil Case No. 2203-0. Petitioner's argument that there is no identity of parties between the two actions is without merit. We have repeatedly ruled that for res judicata to apply, what is required 11 is not absolute but only substantial identity of parties. It is fundamental that the application of res judicata may not be evaded by simply including additional parties in a subsequent litigation. In fact we have said that there is still identity of parties although in the second action there is one party who was not joined in the first action, if it 12 appears that such party is nota necessary party either in the first or second action, or 13 is a mere nominal party. Thus, Sec. 49, par. (b), Rule 39, Rules of Court, provides that ". . . the judgment or order is, with respect to the matter directly adjudged or as to any other matter that could have been raised in relation thereto, conclusive between the parties and their successors in interest by title subsequent to the commencement of the action or special proceeding, litigating for the same thing and under the same title and in the same capacity." In the case at bench, it is evident that private respondent Reino Rosete is a successor in interest of Ben Babol by title subsequent to the commencement and termination of the first action. Hence, there is actual, if not substantial, identity of the parties between the

two actions. But, there is merit in petitioner's argument that there is no identity of causes of action between Civil CaseNo. 926 and Civil Case No. 2203-0. Civil Case No. 926 is a complaint for forcible entry, where what is at issue is prior 14 possession, regardless of who has lawful title over the disputed property. Thus, "[t]he only issue in an action for forcible entry is the physical or material possession of real property, that is, possession de facto and not possession de jure. The philosophy underlying this remedy is that irrespective of the actual condition of the title to the property, the party in peaceable quiet possession shall not be turned out by strong 15 hand, violence or terror." And, a judgment rendered in a case for recovery of possession is conclusive only on the question of possession and not on the ownership. It 16 does not in any way bind the title or affect the ownership of the land or building. On the other hand, Civil Case No. 2203-0 while inaccurately captioned as an action for "Quieting of Title and Recovery of Possession with Damages" is in reality an action to 17 recover a parcel of land or an accion reivindicatoria under Art. 434 of the Civil Code, and should be distinguished from Civil Case No. 926, which is an accion interdictal. From the averments of the complaint in Civil Case No. 2203-0, plaintiff therein (petitioner herein) clearly sets up title to herself and prays that respondent Rosete be ejected from the disputed land and that she be declared the owner and given possession thereof. 18 Certainly, the allegations partake of the nature of an accion reivindicatoria. The doctrine in Emilia v. Bado, , decided more than twenty-five years ago, is still good law and has preserved the age-old remedies available under existing laws and jurisprudence to recover possession of real property, namely accion interdictal, which is the summary action for forcible entry (detentacion) where the defendant's possession of the property is illegal ab initio, or the summary action for unlawful detainer (desahuico) where the defendant's possession was originally lawful but ceased to be so by the expiration of his right to possess, both of which must be brought within one year from the date of actual entry on the land, in case of forcible entry, and from the date of last demand, in case of unlawful detainer, in the proper municipal trial court or 20 metropolitan trial court; accion publiciana which is a plenary action for recovery of the right to possess and which should be brought in the proper regional trial court when the dispossession has lasted for more than one year; and, accion reivindicatoria or accion de reivindicacion which seeks the recovery of ownership and includes the jus utendi and the jus fruendi brought in the proper regional trial court. Accion reivindicatoria or accion de reivindicacion is thus an action whereby plaintiff 21 alleges ownership over a parcel of land and seeks recovery of its full possession. It is different from accion interdictal or accion publiciana where plaintiff merely alleges 22 proof of a better right to possess without claim of title. In Civil Case No. 926 petitioner merely claimed a better right or prior possession over the disputed area without asserting title thereto. It should be distinguished from Civil Case No. 2203-0 where she expressly alleged ownership, specifically praying that she be
19

declared the rightful owner and given possession of the disputed portion. Hence, in Civil Case No. 926 petitioner merely alleged that she was "the true, lawful (possessor) and in actual, prior physical possession" of the subject parcel of land, whereas in Civil Case No. 2203-0 she asserted that she was "the absolute owner in fee simple" of the parcel of land "covered by Original Transfer Certificate of Title No. P-3259." The complaint in Civil Case No. 2203-0 definitely raises the question of ownership and clearly gives defendants therein notice of plaintiff's claim of exclusive and absolute ownership, including the right to possess which is an elemental attribute of such ownership. Thus, this Court has ruled that a judgment in forcible entry or detainer case disposes of no other issue than possession and declares only who has the right of possession, but by no means constitutes a bar to an action for determination of who has the right or title of 23 ownership. And, applying the ruling of the Court En Banc in Quimpo v. De la Victoria, even if we treat Civil Case No. 2203-0 as a petition to quiet title, as its caption suggests, still it has a cause of action different from that for ejectment. Consequently, there being no identity of causes of action between Civil Case No. 926 and Civil Case No. 2203-0, the prior complaint for ejectment cannot bar the subsequent action for recovery, or petition to quiet title. WHEREFORE, the petition is GRANTED. The Order dated 27 January 1978 of the then Court of First Instance of Zambales, Br. I, with station in Olongapo City, dismissing Civil Case No. 2203-0, and its subsequent Order denying reconsideration of the dismissal are REVERSED and SET ASIDE. The Clerk of Court is directed to remand the records immediately to the court of a quo and the latter to proceed with the trial of Civil Case No. 2203-0 with deliberate dispatch. This decision is immediately executory. SO ORDERED. Cruz, Davide, Jr., Quiason and Kapunan, JJ., concur.
24

[G.R. Nos. 120784-85. January 24, 2001]

284-B to spouses Venancio Viray and Cecilia Nunga-Viray. On February 8, 1989, the Regional Trial Court, Pampanga, Macabebe, Branch 55 rendered a decision in favor of Moses G. Mendoza, the dispositive portion of which provides:

SPOUSES WARLITO BUSTOS and HERMINIA REYES-BUSTOS, petitioners, vs. COURT OF APPEALS, SPOUSES VENANCIO VIRAY and CECILIA NUNGA-VIRAY, respondents. DECISION PARDO, J.: The case before the Court is an appeal via certiorari seeking to set aside the decision of the Court of Appeals[1] modifying that of the Regional Trial Court, Pampanga, Macabebe, Branch 55[2] and the resolution denying reconsideration.[3] Paulino Fajardo died intestate on April 2, 1957.[4] He had four (4) children, namely: Manuela, Trinidad, Beatriz and Marcial, all surnamed Fajardo. On September 30, 1964, the heirs executed an extra-judicial partition[5] of the estate of Paulino Fajardo. On the same date, Manuela sold her share to Moses[6] G. Mendoza, husband of Beatriz by deed of absolute sale.[7] The description of the property reads as follows: A parcel of an irrigated riceland located in the barrio of San Isidro, Masantol, Pampanga. Bounded on the North, by Paulino Fajardo; on the East, by Paulino Fajardo; on the South, by Eleuterio Bautista; and on the West, by Paulino Guintu. Containing an area of 5,253 sq. mts., more or less. Declared under Tax Declaration No. 3029 in the sum of P710.00. At the time of the sale, there was no cadastral survey in Masantol, Pampanga. Later, the cadastre was conducted, and the property involved in the partition case were specified as Lots 280, 283, 284, 1000-A and 1000-B. The share of Manuela, which was sold to Moses, includes Lot 284 of the Masantol Cadastre and Lot 284 was subdivided into Lots 284-A and 284-B. Trinidad was in physical possession of the land. She refused to surrender the land to her brother-in-law Moses G. Mendoza, despite several demands. On September 3, 1971, Moses filed with the Court of First Instance, Pampanga a complaint for partition claiming the one fourth () share of Manuela which was sold to him.[8] During the pendency of the case for partition, Trinidad Fajardo died. On December 15, 1984, the heirs executed an extra-judicial partition of the estate of Trinidad Fajardo. On February 16, 1987, Lucio Fajardo Ignacio, son of Trinidad sold Lot

WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiffs and against the defendants, and hereby orders 1. The division and partition of the parcel of land identified and described earlier with the aid and assistance of a qualified surveyor, segregating therefrom an area equivalent to portion to be taken from the vacant right eastern portion which is toward the national road the same to be determined by one (or the said surveyor) standing on the subject land facing the municipal road, at the expense of the plaintiffs; 2. The said portion segregated shall be a fixed portion, described by metes and bounds, and shall be adjudicated and assigned to the plaintiffs; 3. In case of disagreement as to where the said right eastern portion should be taken, a commission is hereby constituted, and the OICClerk of Court is hereby appointed chairman, and the OIC-Branch Clerk of Court of Branches 54 and 55 of this Court are hereby appointed members, to carry out the orders contained in the foregoing first two paragraphs; 4. The defendants to pay the plaintiffs the sum of P500.00 as attorneys fees, and to pay the costs of the proceedings. SO ORDERED.*9+ On September 13, 1991, Moses sold the subject land to spouses Warlito Bustos and Herminia Reyes-Bustos. In the meantime, on November 6, 1989, spouses Venancio Viray and Cecilia Nunga-Viray, buyers of Lucio Ignacios share of the property, filed with the Municipal Circuit Trial Court, Macabebe-Masantol, Pampanga an action for unlawful detainer[10] against spouses Bustos, the buyers of Moses G. Mendoza, who were in actual possession as lessees of the husband of Trinidad, Francisco Ignacio, of the subject land. The municipal circuit trial court decided the case in favor of spouses Viray. Subsequently, the trial court issued writs of execution and demolition, but were stayed when spouses Bustos filed with the Regional Trial Court, Pampanga, Macabebe, Branch 55,[11] a petition for certiorari, prohibition and injunction.

On December 18, 1992, the regional trial court rendered a decision, the dispositive portion of which reads: WHEREFORE, premises considered, this case, is as it is hereby, dismissed. The preliminary injunction is ordered dissolved and the petitioners and Meridian Assurance Corporation are hereby ordered jointly and severally, to pay the private respondents the sum of P20,000.00 by way of litigation expenses and attorneys fees, and to pay the cost of the proceedings.*12+ In time, the spouses Bustos appealed the decision to the Court of Appeals.[13] On February 27, 1989, Lucio Fajardo Ignacio also appealed the decision to the Court of Appeals.[14] Upon motion for consolidation of the petitioners, on August 9, 1993, the Court of Appeals resolved to consolidate CA-G. R. SP No. 30369 and CA-G. R. CV No. 37606.[15] On August 26, 1994, the Court of Appeals promulgated its decision in the two cases, the dispositive portion of which provides: WHEREFORE, in view of all the foregoing, consolidated judgment is hereby rendered for both CA-G. R. SP No. 37607 and CA-G. R. SP NO. 30369 as follows: 1. The appeal docketed as CA-G. R. CV No. 37607 is dismissed; Moses Mendoza is declared as owner of the undivided share previously owned by Manuela Fajardo; and the decision of the Regional Trial Court dated February 8, 1989 in Civil Case No. 83-0005-M is affirmed but MODIFIED as follows: WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiffs and against the defendants, and hereby orders 1. A relocation survey to be conducted (at the expense of the plaintiffs) to retrace the land subject of the deed of sale dated September 30, 1964 between Manuela Fajardo and Moses Mendoza; 2. The division and partition of said relocated land by segregating therefrom an area equivalent to portion to be taken from the vacant right eastern portion which is toward the national road, the same to be determined by one standing on the subject land facing the municipal road, at the expense of the plaintiff-appellees; 3. The said portion segregated shall be a fixed portion, described by metes and bounds, and shall be adjudicated and assigned to the plaintiffs-appellees;

4. In case of disagreement as to where the said right eastern portion should be taken, a Commission is hereby constituted, with the OIC/present Clerk of Court as Chairman, and the OIC/present Branch Clerks of Court of Branches 54 and 55 of the Court (RTC) as members, to carry out and implement the Orders contained in the second and third paragraphs hereof; 5. The defendants are ordered to pay the plaintiffs the sum of P500.00 as attorneys fees, and to pay the costs of the proceedings. 2. The dismissal of Civil Case No. 92-0421-M is AFFIRMED but the reasons for its dismissal shall be effective only as to the issue of possession. CA-G. R. SP No. 30369 is DISMISSED. 3. No pronouncement as to costs. SO ORDERED.*16+ On September 9, 1994, petitioners filed a motion for reconsideration;[17] however, on June 21, 1995, the Court of Appeals denied the motion.[18] Hence, this petition.[19] The issue raised is whether petitioners could be ejected from what is now their own land. The petition is meritorious. In this case, the issue of possession is intertwined with the issue of ownership. In the unlawful detainer case, the Court of Appeals affirmed the decision of the trial court as to possession on the ground that the decision has become final and executory. This means that the petitioners may be evicted. In the accion reinvindicatoria, the Court of Appeals affirmed the ownership of petitioners over the subject land. Hence, the court declared petitioners as the lawful owners of the land. Admittedly, the decision in the ejectment case is final and executory. However, the ministerial duty of the court to order execution of a final and executory judgment admits of exceptions. In Lipana vs. Development Bank of Rizal,[20] the Supreme Court reiterated the rule once a decision becomes final and executory, it is the ministerial duty of the court to order its execution, admits of certain exceptions as in cases of special and exceptional nature where it becomes imperative in the higher interest of justice to direct the suspension of its execution (Vecine v. Geronimo, 59 O. G. 579); whenever it is necessary to accomplish the aims of justice (Pascual v. Tan, 85 Phil. 164); or when certain facts and circumstances transpired after the judgment became final which could render the execution of the judgment unjust (Cabrias v. Adil, 135 SCRA 354).

In the present case, the stay of execution is warranted by the fact that petitioners are now legal owners of the land in question and are occupants thereof. To execute the judgment by ejecting petitioners from the land that they owned would certainly result in grave injustice. Besides, the issue of possession was rendered moot when the court adjudicated ownership to the spouses Bustos by virtue of a valid deed of sale. Placing petitioners in possession of the land in question is the necessary and logical consequence of the decision declaring them as the rightful owners of the property.[21] One of the essential attributes of ownership is possession. It follows that as owners of the subject property, petitioners are entitled to possession of the same. An owner who cannot exercise the seven (7) juses or attributes of ownership--the right to possess, to use and enjoy, to abuse or consume, to accessories, to dispose or alienate, to recover or vindicate and to the fruits--is a crippled owner.*22+ WHEREFORE, we GRANT the petition. We SET ASIDE the decision of the Court of Appeals in CA G. R. SP No. 30609 for being moot and academic. We AFFIRM the decision of the Court of Appeals in CA G. R. CV No. 37606. No costs. SO ORDERED. Davide, Jr., C.J., Puno, Kapunan, and Ynares-Santiago, JJ., concur. Republic of the PhilippinesSUPREME COURTManila

FIRST DIVISION G.R. No. 128177 August 15, 2001

HEIRS OF ROMAN SORIANO, petitioners, vs.THE HONORABLE COURT OF APPEALS, SPOUSES BRAULIO ABALOS and AQUILINA ABALOS, respondents. YNARES-SANTIAGO,J.: May a winning party in a land registration case effectively eject the possessor thereof, whose security of tenure rights are still pending determination before the DARAB? The instant petition for certiorari seeks to set aside the Decision 1 dated September 20, 1996 of the Court of Appeals in CA-G.R. SP No. 34930 as well as its Resolution 2 dated January 15, 1997, denying petitioners' Motion for Reconsideration. We quote the undisputed facts as narrated by the Court of Appeals, to wit The property subject of this case is a parcel of land containing an area of 24,550 square meters, more or less, located in Lingayen, Pangasinan, and particularly described as follows: A parcel of land (Nipa with an area of 8,410 square meters; fishpond with an area of 14,000 square meters; and residential land with an area of 1,740 square meters, more or less. Bounded on the N, by river and Filemon Anselmo; on the South by Alejandro Soriano and Filemon Anselmo; and on the West by Fortunata Soriano. Originally owned by Adriano Soriano until his death in 1947, the above-described property passed on to his heirs who leased the same to spouses David de Vera and Consuelo Villasista for a period of fifteen (15) years beginning July 1, 1967 with Roman Soriano, one of the children of Adriano Soriano, acting as caretaker of the property during the period of the lease. After executing an extra judicial settlement among themselves, the heirs of Adriano Soriano subsequently subdivided the property into two (2) lots, Lot No. 60052 and Lot No. 8459. Lot No. 60052 was assigned to Lourdes, Candido and the heirs of Dionisia while Lot No. 8459 was assigned to Francisca, Librada, Elocadio and Roman. In 1971, Lot No. 60052 was sold by Lourdes, Candido and the heirs of Dionisia to petitioner spouses Braulio and Aquilina Abalos (hereinafter referred to as petitioners), while, Elocadio, Francisca and Librada sold their three-fourths shares in Lot No. 8459 also to petitioners. On March 14, 1968, the de Vera spouses ousted Roman Soriano as caretaker and appointed Isidro Verzosa and Vidal Verzosa as his substitutes. Thereafter, Roman Soriano filedCAR Case No. 1724-P-68 for reinstatement and reliquidation against the de Vera spouses. The agrarian court authorized the ejectment of Roman Soriano but on

appeal, the decision was reversed by the Court of Appeals, which decision became final and executory. However, prior to the execution of the said decision, the parties entered into a post-decisional agreement wherein the de Vera spouses allowed Roman Soriano to sub-lease the property until the termination of the lease in 1982. In an Order dated December 22, 1972, the post-decisional agreement was approved by the agrarian court. On August 16, 1976, petitioners filed with the Regional Trial Court of Lingayen, Pangasinan, Branch 38, an application for registration of title over Lot No. 60052 and three-fourths (3/4)pro-indiviso of Lot No. 8459, docketed asLRC Case No. N-3405. Said application for registration was granted by the trial court, acting as a land registration court, per Decision dated June 27, 1983. On appeal, the Court of Appeals affirmed the decision of the land registration court. The petition for review filed with the Supreme Court by Roman Soriano docketed asG.R. 70842, was denied for lack of merit and entry of judgment was entered on December 16, 1985. Meanwhile, it appears that on July 15, 1983, a day after the promulgation of the land registration court's decision, Roman Soriano, together with Elocadio and Librada Soriano, filed before the Regional Trial Court of Lingayen, Branch 37, and against petitioners, an action for annulment of document and/or redemption, ownership and damages, docketed asCivil Case No. 159568 (sic; should be 15958). Petitioners filed a motion to dismiss on the ground ofres judicata, pendency of another action, laches, misjoinder of parties and lack of jurisdiction, which was denied by the trial court. Thereafter, on August 22, 1984, or eleven (11) years after the approval of the postdecisional agreement between Roman Soriano and the spouses de Vera in CAR Case No. 1724-P-68 for reinstatement and reliquidation, petitioners filed with the agrarian court a motion for execution of said post-decisional agreement which allowed Roman Soriano to sub-lease the property. The motion prayed that petitioners be placed in possession of the subject property, jointly with Roman Soriano, and to levy so much of Roman's property to answer for the use and occupation by Soriano of 6/7 share of the property. On October 25, 1984, Roman Soriano filed a motion to suspend hearing on the rental demanded by petitioners, which, however, was denied by the agrarian court. The agrarian court likewise authorized the substitution of the de Vera spouses by petitioners. Soriano's motion for reconsideration was also denied, prompting Soriano to file a petition for certiorari with the Court of Appeals. In the meantime, Roman Soriano died on December 11, 1985. Thus, the complaint inCivil Case No. 159568 (sic) for annulment of document and/or redemption, ownership and damages, was amended to substitute Soriano's heirs, herein private respondents, as party-plaintiffs. The complaint was again amended to include Juanito Ulanday as partydefendant for having allegedly purchased part of the disputed property from petitioners. On motion of petitioners, the re-amended complaint was dismissed by the trial court on the ground that the re-amended complaint altered the cause of action. Upon reconsideration, the dismissal was set aside and petitioners were ordered to file their Answer, in view of which petitioners filed a petition for certiorari and prohibition

with the Court of Appeals, docketed asC.A. GR SP No. 22149. On April 25, 1990, the Court of Appeals denied the petition filed by Roman Soriano (substituted by private respondents) impugning the denial of their motion to suspend hearing on the rental demanded by petitioners, and authorizing the substitution of the de Vera spouses by petitioners, on the ground that no grave abuse of discretion was committed by the agrarian court. Thus, private respondents filed a petition for review on certiorari with the Supreme Court, docketed asG.R. 93401. Meanwhile, on December 7, 1990, the Court of Appeals in C.A. GR SP No. 22149, also denied the petition for certiorari and prohibition filed by petitioners, ruling that the land registration court committed no error when it refused to adhere to the rule ofres judicata. Petitioners then filed with the Supreme Court a petition for review on certiorari, docketed asG.R. 99843. On June 26, 1991, the Supreme Court promulgated its decision in G.R. 93401, and granted the petition filed by private respondents. Thus, the decision of the Court of Appeals denying the petition of private respondents was set aside, and the motion for execution filed by petitioners inCAR Case No. 1724-P-48 was denied. On June 22, 1993, the Supreme Court, inG.R. 99843, reversed and set aside the denial of the Court of Appeals inC.A. GR SP No. 22149, and consequently,Civil Case No. 15958 for annulment of document and/or redemption, ownership and damages, was ordered dismissed. On October 18, 1993, private respondents filed with the Department of Agrarian Adjudication Board (sic), a complaint against petitioners for "Security of Tenure with prayer for Status Quo Order and Preliminary Injunction" docketed as DARAB Case No. 528-P-93. Meanwhile, it appears that the decision of the land registration court inLRC Case No. N3405 was partially executed with the creation of a Committee on Partition per Order dated March 25, 1987. On July 27, 1988, the land registration court approved the partition of Lot No. 8459, with Lot No. 8459-A assigned to private respondent, and Lot No. 8459-B assigned to petitioners. For Lot No. 60052, O.C.T. No. 22670 was issued in the name of petitioners; for Lot No. 8459-B, O.C.T. No. 22687 was issued, also in the name of petitioner; and for Lot No. 8459-A, O.C.T. No. 22686 was issued in the name of Roman Soriano. Dissatisfied with said partition, private respondents appealed to the Court of Appeals, docketed asCA G.R. SP No. 119497. The appellate court affirmed the partition but reversed the order of the land registration court directing the issuance of a writ of possession on the ground of pendency ofCivil Case No. 15958. On November 15, 1993, the trial court in compliance with the decision of the Supreme Court inG.R. No. 99843, dismissedCivil Case No. 15958, in view of which, petitioner, on November 25, 1993, inLRC Case No. N-3405, moved for the issuance of an alias writ of

execution and/or writ of possession to place them in possession of Lot No. 60052 and Lot No. 8459-B. Per Resolution dated January 21, 1994, said motion was held in abeyance by the land registration court until and afterDARAB Case No. 528-P-93 for security of tenure with prayer forstatus quo, has been resolved. Their motion for reconsideration having been denied on April 5, 1984, petitioners interposed an appeal to the Supreme Court, docketed as G.R. 115073. In a Resolution dated July 27, 1994 issued by the Supreme Court, petitioners' appeal, which was treated as a petition for certiorari, was referred to this Court [of Appeals] for determination and 3 disposition. The Court of Appeals annulled and set aside the Resolution of the land registration court and ordered instead the issuance of the corresponding writ of possession in favor of private respondents. With the denial of their Motion for Reconsideration, petitioners are now before us raising the following grounds: 1. THE DECISION AND RESOLUTION OF THE RESPONDENT COURT OF APPEALS ARE CONTRARY TO THE PROVISIONS OF THE AGRARIAN REFORM LAWS AND JURISPRUDENCE ON THE SECURITY OF TENURE OF TENANT-CARETAKER. 2. THE DECISION AND RESOLUTION OF THE RESPONDENT COURT OF APPEALS ARE VIOLATIVE OF THE PROVISION ON RIGHT TO DUE PROCESS. 3. THE HONORABLE COURT OF APPEALS GRAVELY ABUSED ITS DISCRETION IN GIVING DUE COURSE TO THE PETITION CONSIDERING THAT PRIVATE RESPONDENTS HAD 4 EARLIER PERFECTED AN APPEAL OF THE RESOLUTION SUBJECT OF THEIR PETITION. Possession and ownership are distinct legal concepts. There is ownership when a thing pertaining to one person is completely subjected to his will in a manner not prohibited by law and consistent with the rights of others. Ownership confers certain rights to the owner, among which are the right to enjoy the thing owned and the right to exclude other persons from possession thereof. On the other hand, possession is defined as the holding of a thing or the enjoyment of a right. Literally, to possess means to actually and physically occupy a thing with or without right. Possession may be had in one of two 5 ways: possession in the concept of an owner and possession of a holder. A person may be declared owner but he may not be entitled to possession. The possession may be in the hands of another either as a lessee or a tenant. A person may have improvements thereon of which he may not be deprived without due hearing. He may have other valid defenses to resist surrender of possession. A judgment for ownership, therefore, does 6 not necessarily include possession as a necessary incident. There is no dispute that private respondents' (petitioners below) title over the land under litigation has been confirmed with finality. As explained above, however, such declaration pertains only to ownership and does not automatically include possession, especially so in the instant case where there is a third party occupying the said parcel of

land, allegedly in the concept of an agricultural tenant. While the issue of ownership of the subject land has been laid to rest in the final judgment of the land registration court, the right of possession thereof is, as yet, controverted. This is precisely what is put in issue in the security of tenure case filed by petitioners (private respondents below) before the DARAB. It is important to note that although private respondents have been declared titled owners of the subject land, the exercise of their rights of ownership are subject to 7 limitations that may be imposed by law. The Tenancy Act provides one such limitation. Agricultural lessees are entitled to security of tenure and they have the right to work on their respective landholdings once the leasehold relationship is established. Security of tenure is a legal concession to agricultural lessees which they value as life itself and deprivation of their landholdings is tantamount to deprivation of their only means of 8 livelihood. The exercise of the right of ownership, then, yields to the exercise of the rights of an agricultural tenant. However, petitioners' status as tenant has not yet been declared by the DARAB. In keeping with judicial order, we refrain from ruling on whether petitioners may be 9 dispossessed of the subject property. As ratiocinated in Nona v. Plan It is to the credit of respondent Judge that he has shown awareness of the recent Presidential Decrees which are impressed with an even more solicitous concern for the rights of the tenants.If, therefore, as he pointed out in his order granting the writ of possession, there is a pending case between the parties before the Court of Agrarian Relations, ordinary prudence, let alone the letter of the law, ought to have cautioned him against granting the plea of private respondents that they be placed in possession of the land in controversy,x x x. At the time the challenged orders were issued, without any showing of how the tenancy controversy in the Court of Agrarian Relations was disposed of, respondent Judge could not by himself and with due observance of the restraints that cabin and confine his jurisdiction pass upon the question of tenancy. (Emphasis ours) In its challenged Decision, the Court of Appeals relied heavily on the principle of finality of judgments. It applied the legal doctrine that once a judgment has become final, the issuance of a writ of execution becomes ministerial. The appellate court held that petitioner's situation does not fall under any of the exceptions to this rule since his occupation of the subject land did not transpire after the land registration court's adjudication became final. In so ruling, however, the Court of Appeals loses sight of the fact that petitioner's claim of possession as a tenant of the litigated property, if proven, entitles him to protection against dispossession. Private respondents argue that petitioners' tenancy claim is barred by res judicata,

having been ruled upon in G.R. Nos. 99843 and 93401. However, not being an issue in the case before us, this question should properly be resolved in DARAB Case No. 528-P93. To restate, the only issue before us is whether or not a winning party in a land registration case can effectively eject the possessor thereof, whose security of tenure rights are still pending determination before the DARAB. A judgment in a land registration case cannot be effectively used to oust the possessor of the land, whose security of tenure rights are still pending determination before the DARAB. Stated differently, the prevailing party in a land registration case cannot be placed in possession of the area while it is being occupied by one claiming to be an agricultural tenant, pending a declaration that the latter's occupancy was unlawful. WHEREFORE, the instant petition for certiorari is hereby GRANTED. The Decision of respondent Court of Appeals in CA-G.R. SP No. 34930 dated September 20, 1996, as well as its Resolution dated January 15, 1997 are SET ASIDE. The Resolution of the Regional Trial Court of Lingayen, Pangasinan in LRC Case No. N-3405 dated January 21, 1994 is ordered REINSTATED. SO ORDERED. Davide, Jr., C .J ., Puno, Kapunan and Pardo, JJ ., concur.

Republic of the PhilippinesSUPREME COURTManila FIRST DIVISION G.R. No. 133140 August 10, 1999

nullification of the extrajudicial foreclosure of mortgage, public auction sale, and PBCom's title docketed as Civil Case No. 11891. This complaint was dismissed for failure to prosecute. On October 15, 1985, PBCom filed at the Regional Trial Court (RTC) of Makati a petition for the issuance of a writ of possession over the land, docketed as LRC Case No. M-731, which Branch 148 thereof granted. Upon service of the writ of possession, Mrs. Magpayo's brother, Jose Ma. T. Garcia (Garcia), who was in possession of the land, refused to honor it and filed a motion for Intervention in the above-said PBCom petition, which motion was denied. Garcia thereupon filed against PBCom, the Magpayos, and the RTC Sheriff the instant suit for recovery of realty and damages wherein he alleged, inter alia, that he inherited the land as one of the heirs of his mother Remedios T. Garcia, and that PBCom acquired no right thereover. In its answer, PBCom averred, inter alia, that Garcia's claim over the land is belied by the fact that it is not among the properties owned by his mother listed in the Inventory of Real Estate filed at the then CFI of Pasay City, Branch 27, in SP Proc. No. 2917-P, "In the Matter of the Intestate Estate of Remedios T. Garcia Petition for Letters of Administration, Pedro V. Garcia Petitioner-Administrator. The Magpayos, on the other hand, asserted that title over the land was transferred to them by Mrs. Magpayo's parents to enable them (Magpayos) to borrow from PBCom. Garcia filed a Motion for Summary Judgment praying that judgment be rendered in his favor to which PBCom counter-motioned that judgment should be rendered in its favor. The court a quo denied the motion for summary judgment on the ground that PBCom raised in its answer both factual and legal issues which could only be ventilated in a fullblown trial. The court a quo, however, later issued a summary judgment.
2

JOSE MA. T. GARCIA, petitioner, vs.COURT OF APPEALS, SPS. LUISITO & MA. LUISA MAGPAYO AND PHILIPPINE BANK OF COMMUNICATIONS, respondents. PUNO, J.: This is a petition for review under Rule 45 of the Rules of Court to set aside the decision rendered by the Court of Appeals in CA-G.R. No. 44707 entitled "Jose Ma. T. Garcia, Plaintiff-Appellee versus Spouses Luisito and Ma. Luisa Magpayo and Sheriff of Makati, 1 Defendants, Philippine Bank of Communications, Defendant-Appellant". The facts are as succinctly summarized by the appellate court, viz.: Atty. Pedro V. Garcia, in whose name TCT No. S-31269 covering a parcel of land identified as Lot 17 situated at Bel Air II Village, Makati, was registered, sold with the consent of his wife Remedios T. Garcia, the same to their daughter Ma. Luisa Magpayo and her husband Luisito Magpayo (the Magpayos). On March 5, 1981, the Magpayos mortgaged the land to the Philippine Bank of Communications (PBCom) to secure a loan, Five Hundred Sixty Four Thousand (P564,000.00) Pesos according to them, One Million Two Hundred Thousand (P1,200,000.00) Pesos according to PBCom.1wphi1.nt On March 9, 1981, Atty. Garcia's Title was cancelled and in its stead Transfer Certificate of Title No. S-108412/545 was issued in the name of the Magpayos. The Deed of Real Estate Mortgage was registered at the Makati Register of Deeds and annotated on the Magpayos title. The Magpayos failed to pay their loan upon its maturity, hence, the mortgage was extrajudicially foreclosed and at the public auction sale, PBCom which was the highest bidder bought the land. The redemption period of the foreclosed mortgage expired without the Magpayos redeeming the same, hence, title over the land was consolidated in favor of PBCom which cancelled the Magpayo's title and Transfer Certificate of Title No. 138233 was issued in its name. On October 4, 1985, the Magpayos filed at the RTC of Makati a complaint seeking the

In its summary judgment, the lower court held that the mortgage executed by the Magpayo spouses in favor of PBCom was void. It found that: . . . [A]t the time that the defendants Magpayo spouses executed the mortgage in favor of the defendant PBCom on March 5, 1981, the said spouses were not yet the owners of the property. This finding is evident from the other undisputed fact that a new Torrens title was issued to the defendants Magpayo spouses only on March 9, 1981 . . . . The Magpayo spouses could not have acquired the said property merely by the execution of the Deed of Sale because the property was in the possession of the plaintiff. The vendor,

Pedro V. Garcia, was not in possession and hence could not deliver the property merely by the execution of the document (MANALILI V. CESAR, 39 PHIL. 134). The conclusion is therefore inescapable that the said mortgage is null and void for lack of one of the 3 essential elements of a mortgage as required by Art. 2085 of our Civil Code . . . . Thus, it invalidated the foreclosure sale and nullified TCT No. 138233 issued to PBCom. Dissatisfied, PBCom appealed. In reversing the trial court, the Court of Appeals held: (P)laintiff-appellee's assertion that ownership over the disputed property was not transmitted to his sister and her husband-Magpayo spouses at the time of the execution of the Deed of Sale as he was still in actual and adverse possession thereof does not lie. For in his complaint, plaintiff-appellee alleged that he entered into possession of the disputed property only upon the demise of his mother, from whom he alleges to have inherited it but who was not the registered owner of the property, that is, on October 31, 1980 (Certificate of Death, p. 17, Records), by which admission he is bound. Since the execution of the deed of sale by Atty. Pedro V. Garcia in favor of the Magpayos took place earlier or on August 1, 1980, then contrary to his claim, plaintiff-appellee was not in possession of the property at the time of the execution of said public instrument. Furthermore, it appearing that the vendor Atty. Garcia had control of the property which was registered in his name and that the deed of sale was likewise registered, then the sale was consummated and the Magpayos were free to exercise the attributes of ownership including the right to mortgage the land. When the land is registered in the vendor's name, and the public instrument of sale is also registered, the sale may be considered consummated and the buyer may exercise the actions of an owner (Tolentino, Commentaries and Jurisprudence on the Civil Code of the Philippines, 1992 Ed., p. 55). That the Magpayos' title, TCT No. S-108412, was issued four (4) days following the execution of the deed of real estate mortgage is of no moment, for registration under the Torrens system does not vest ownership but is intended merely to confirm and register the title which one may already have on the land (Municipality of Victorias v. Court of Appeals, 149 SCRA 32, 44-45 [1987]). Petitioner Garcia moved for a reconsideration of above decision which was denied. He now comes before us raising the following errors committed by the Court Appeals: I The respondent Court of Appeals has departed from the accepted and usual course of proceedings when it decided the appeal subject of this case based on issues which were raised neither in the trial court nor in the appellant's brief.

II The Court of Appeals decided the appeal in a manner not in accord with applicable jurisprudence when it disregarded the admissions of the private respondents and, despite ruling that Summary Judgment was proper, made its own findings of facts which were contrary to the said admissions. III The Decision of the respondent Court of Appeals was not in accord with established jurisprudence and even contradicts itself, as far as the issue of the propriety of the Summary Judgment is concerned. The petition has no merit. Anent the first assignment of error, petitioner alleged that the Court of Appeals resolved the issues "ownership" and "possession" though they were not raised by PBCom in its appellant's brief. The allegation is belied by page 17 of PBCom's appellate brief, viz.: Due to the wrong cited case, the trial court opined erroneously that "Magpayo Spouses could not have acquired the property merely by the execution of the deed of sale because the property was in the possession of the plaintiff" (Order, p. 10). Again, the trial court could not distinguish ownership from possession. Ownership and possession are two entirely different legal concepts. Plaintiff-appellee's possession as found by the trial court, started only "at the time of the filing of the complaint in this present case up to the present." (page 2, Summary Judgment). Assuming that to be true, plaintiff-appellee's possession which started only in 1986 could not ripen into ownership. He has no valid title thereto. His possession in fact was that of an intruder, one done in bad faith (to defeat PBCom's Writ of Possession). His possession is certainly not in the concept of an owner. This is so because as early as 1981, title thereto was registered in the name of the Magpayo Spouses which title was subsequently cancelled when the property was purchased by PBCom in a public auction sale resulting in the issuance of title in favor of the latter in 1985. Anent the second-assignment of error, petitioner contends that the following facts were admitted by the parties in the trial court: 1. The petitioner is a compulsory heir of the late spouses Atty. Pedro V. Garcia and Remedios Tablan Garcia;

2. The property subject of this dispute was previously the conjugal property of the said spouses; 3. The petitioner and his family have been and are continuously to the present in actual physical possession of the property. At the time of the alleged sale to the Magpayo spouses, petitioner was in possession of the property; 4. When his mother Remedios Tablan ( sic) Garcia died, sometime in October, 1980, he became, by operation of law, a co-owner of the property; 5. Atty. Pedro V. Garcia, at the time of the execution of the instrument in favor of the 4 Magpayo spouses was not in possession of the subject property. We reject the contention of petitioner for a perusal of the records shows that these alleged admitted facts are his own paraphrased portions of the findings of fact listed by 5 the trial court in the summary judgment. Indeed petitioner did not cite any page number of the records or refer to any documentary Exhibit to prove how and who admitted the said facts. Petitioner's third assignment of error that he alone as plaintiff in the trial court is entitled to a summary judgment merits scant attention. A summary judgment is one granted by the court, upon motion by either party, for an expeditious settlement of the case, there appearing from the pleadings, depositions, admissions, and affidavits that no important questions or issues of fact are involved (except the determination of the amount of damages) and that therefore the moving party is entitled to a judgment as a 6 matter of law. Under Rule 34, either party may move for a summary judgment the
claimant by virtue of Section 1 and the defending party by virtue of Section 2, viz.: Sec. 1. Summary judgment for claimant. A party seeking to recover upon a claim, counterclaim, or cross-claim or to obtain a declaratory relief may, at any time after the pleading in answer thereto has been served, move with supporting affidavits for a summary judgment in his favor upon all or any part thereof. Sec. 2. Summary judgment for defending party. A party against whom a claim, counterclaim, or cross-claim is asserted or a declaratory relief is sought may, at any time, move with supporting affidavits for a summary judgment in his favor as to all or any part thereof. It is true that petitioner made the initial move for summary judgment. Nonetheless, PBCom likewise moved for a summary judgment with supporting affidavit and documentary exhibits, to wit: COUNTER-MOTION FOR SUMMARY JUDGMENT

The procedure for summary judgment may be availed of also by the defending parties who may be the object of unfounded claims as clearly shown in Sections 1 and 2 of Rule 34. xxx xxx xxx

WHEREFORE, it is respectfully prayed of this Honorable Court to render summary judgment in PBCom's favor by DISMISSING plaintiff's Complaint as well as Sps. Magpayo's Cross-Claim for 7 being sham and frivolous. Needless to state, there was no error on the part of the appellate court in resorting to summary judgment as prayed for by both parties. We stress again that possession and ownership are distinct legal concepts. Ownership exists when a thing pertaining to one person is completely subjected to his will in a manner not prohibited by 8 law and consistent with the rights of others. Ownership confers certain rights to the owner, one 9 of which is the right to dispose of the thing by way of sale. Atty. Pedro Garcia and his wife Remedios exercised their right to dispose of what they owned when they sold the subject property to the Magpayo spouses. On the other hand, possession is defined as the holding of a 10 thing or the enjoyment of a right. Literally, to possess means to actually and physically occupy a thing with or without right. Possession may be had in one of two ways: possession in the concept 11 of an owner and possession of a holder. "A possessor in the concept of an owner may be the 12 owner himself or one who claims to be so." On the other hand, "one who possesses as a mere holder acknowledges in another a superior right which he believes to be ownership, whether his 13 belief be right or wrong." The records show that petitioner occupied the property not in the concept of an owner for his stay was merely tolerated by his parents. We held in Caniza v. Court 14 of Appeals that an owner's act of allowing another to occupy his house, rent-free does not create a permanent and indefeasible right of possession in the latter's favor. Consequently, it is of no moment that petitioner was in possession of the property at the time of the sale to the Magpayo spouses. It was not a hindrance to a valid transfer of ownership. On the other hand, petitioner's subsequent claim of ownership as successor to his mother's share in the conjugal asset is belied by the fact that the property was not included in the inventory of the estate submitted by his father to the intestate court. This buttresses the ruling that indeed the property was no longer considered owned by petitioner's parents. We also uphold the Court of Appeals in holding that the mortgage to PBCom by the Magpayo spouses is valid notwithstanding that the transfer certificate of title over the property was issued to them after the mortgage contract was entered into. Registration does not confer ownership, it is merely evidence of such ownership 15 over a particular property. The deed of sale operates as a formal or symbolic delivery of the 16 property sold and authorizes the buyer to use the document as proof of ownership. All said, the 17 Magpayo spouses were already the owners when they mortgaged the property to PBCom. IN VIEW WHEREOF, the decision of the Court of Appeals in CA-G.R. No. 44707 is AFFIRMED. Costs against petitioner.1wphi1.nt SO ORDERED. Davide, Jr., C.J., Kapunan, Pardo and Ynares-Santiago, JJ., concur.

PBCom Is Entitled To A Summary Judgment

[G.R. No. 129609. November 29, 2001]

(DGSREPM).[9] Pending action on the offer of RODIL to purchase the property, Director Factora of the BSRPMO granted RODILs request for another renewal of the lease contract on 23 September 1987 for another five (5) years from 1 September 1987.[10] The renewal contract was forwarded to then Secretary Jose de Jesus of DGSREPM for approval. On 25 September 1987 Undersecretary of DGSREPM Rufino B. Banas recommended to Secrectary De Jesus the suspension of the approval of the renewal contract because the offer of the ASSOCIATION was more beneficial to the REPUBLIC. Resultantly, on 30 September 1987 Secretary De Jesus issued another memorandum to Director Factora disapproving the renewal contract in favor of RODIL, at the same time recalling all papers signed by him regarding the subject. Secretary De Jesus likewise directed RODIL to pay its realty tax delinquency and ordered the issuance of a temporary occupancy permit to the ASSOCIATION.[11] On 6 October 1987 RODIL filed an action for specific performance, damages and injunction with prayer for temporary restraining order before the Regional Trial Court of Manila against the REPUBLIC, De Jesus, Banas, Factora and the ASSOCIATION.[12] RODIL prayed that a restraining order be issued enjoining the ASSOCIATION or any person acting under it from collecting rentals from the occupants or sub-lessees of O'RACCA. On 26 October 1987 the trial court granted the writ of preliminary injunction.[13] On appeal, the Court of Appeals upheld the issuance of the writ of preliminary injunction and ordered the deposit of the monthly rentals with the lower court pendente lite. On 20 November 1987 the REPUBLIC, De Jesus, Banas and Factora filed their Answer with Counterclaim for damages. On 21 December 1987 the ASSOCIATION also filed its Answer with Counterclaim for damages. De Jesus, Banas and Factora were later substituted by Secretary Fulgencio Factoran of the Department of Environment and Natural Resources (DENR) in the action for specific performance. On 31 May 1988 Factoran issued Order No. 1 designating the Land Management Bureau represented by Director Abelardo Palad, Jr. as custodian of all "former alien properties" owned by the REPUBLIC. On 18 May 1992 RODIL signed a renewal contract with Director Palad which was approved by Secretary Factoran.[14] The renewal contract would extend the lease for ten (10) years from 1 September 1987. A supplement to the renewal contract was subsequently entered into on 25 May 1992 where rentals on the previous lease contract were increased.[15] On 14 August 1972 the action for specific performance was dismissed by the trial court upon joint motion to dismiss by RODIL and the Solicitor General. The order of dismissal however was appealed by the ASSOCIATION to the Court of Appeals.[16] On 25 September 1992 the spouses Saturnino Alvarez and Epifania Alvarez,

RODIL ENTERPRISES, INC., petitioner, vs. COURT OF APPEALS, CARMEN BONDOC, TERESITA BONDOC-ESTO, DIVISORIA FOOTWEAR and CHUA HUAY SOON, respondents. [G.R. No. 135537. November 29, 2001]

RODIL ENTERPRISES, INC., petitioner, vs. IDES O'RACCA BUILDING TENANTS ASSOCIATION, INC., respondent. DECISION BELLOSILLO, J.: These twin petitions filed under Rule 45 seek to set aside the Decisions of the Court of Appeals in CA-G.R. Nos. 39919, 36381 and 37243. Petitioner Rodil Enterprises Inc. (RODIL) is the lessee of the Ides O'Racca Building (O'RACCA) since 1959.[1] It was a "former alien property" over which the Republic of the Philippines acquired ownership by virtue of RA 477, as amended.[2] Sometime in 1980 RODIL entered into a sublease contract with respondents Carmen Bondoc, Teresita Bondoc-Esto, Divisoria Footwear and Chua Huay Soon,[3] members of the Ides O'Racca Building Tenants Association Inc. (ASSOCIATION). On 4 September 1972 the lease contract between RODIL and the REPUBLIC was renewed for another fifteen (15) years.[4] At that time the O'RACCA was under the administration of the Building Services and Real Property Management Office (BSRPMO) then headed by Director Jesus R. Factora.[5] On 12 September 1982 BP 233[6] was enacted. It authorized the sale of "former alien properties" classified as commercial and industrial, and the O'RACCA building was classified as commercial property.[7] On 8 January 1987 RODIL offered to purchase the subject property conformably with BP 233 and the REPUBLIC responded that its offer to purchase would be acted upon once the Committee on Appraisal shall have determined the market value of the property.[8] On 22 July 1997 the ASSOCIATION also offerred to lease the same building through the Department of General Services and Real Estate Property Management

sublessees of RODIL, filed with the Office of the President a letter-appeal assailing the authority of Factoran to enter into the renewal contract of 18 May 1992 with RODIL, and claiming the right to purchase the subject property.[17] While the appeal of the ASSOCIATION from the order of dismissal and the letterappeal of the spouses Alvarez were pending, the ASSOCIATION instituted Civil Case No. 92-63833 with the Regional Trial Court of Manila[18] praying for the setting aside of the renewal contract of 18 May 1992 as well as the supplementary contract of 25 May 1992, and further praying for the issuance of a writ of preliminary injunction. On 3 May 1993 the trial court denied the prayer for preliminary injunction. On 30 July 1993 RODIL filed an action for unlawful detainer against Divisoria Footwear,[19] and on 4 August 1993, a similar action against Chua Huay Soon.[20] On 10 September 1993 the trial court dismissed the action for declaration of nullity of the lease contract filed by the ASSOCIATION on the ground of litis pendentia.[21] The Order stated that the action for declaration of nullity and the action for specific performance filed by RODIL were practically between the same parties and for the same causes of action.[22] This Order was appealed by the ASSOCIATION to the Court of Appeals.[23] On 19 January 1994 RODIL filed an action for unlawful detainer against respondent Teresita Bondoc-Esto,[24] and on 1 February 1994 filed another action against respondent Carmen Bondoc,[25] both with the Metropolitan Trial Court of Manila. On 8 February 1994 the Office of the President through Executive Secretary Teofisto Guingona Jr. denied the letter-appeal of the spouses Alvarez, but nullified the renewal contract of 18 May 1992 and the supplementary contract of 25 May 1992.[26] Meanwhile, the Metropolitan Trial Court of Manila upheld RODIL's right to eject respondents Bondoc, Bondoc-Esto, Divisoria Footwear and Chua Huay Soon,[27] as promulgated in separate decisions the dispositive portions of which read IN CIVIL CASE NO. 143301 WHEREFORE, IN VIEW OF THE FOREGOING, judgment is hereby rendered in favor of the plaintiff [RODIL ENTERPRISES, INC.] and against the defendant [CARMEN BONDOC], to wit: 1. Ordering the defendant and all those claiming title under her to vacate the subleased portion of the ORacca Building, corner Folgueras and M. de los Santos Streets, Binondo, Manila; 2. Ordering the defendant to pay plaintiff the back rentals from October 1987 to August 1992 at the rate of P2,665.00 per month and from September 1992 at the rate of P2,665.00 per month plus a yearly increase of 20% per month up to the time that she vacates the premises; 3. Ordering the defendant to pay the amount of P10,000.00 as attorneys fees and to pay the cost of suit. IN CIVIL CASE NO. 143216 -

WHEREFORE, judgment is hereby rendered in favor of the plaintiff [RODIL ENTERPRISES, INC.] as against the defendant [TERESITA BONDOC ESTO] ordering the defendant and all persons claiming rights under her to vacate the premises at ORacca Building located at corner Folgueras and M. de los Santos Streets, Binondo, Manila, and turn over the possession thereof to plaintiff; ordering the defendant to pay plaintiff the amount of P29,700.00 as rental in arrears for the period from September 1992 plus legal rate of interest less whatever amount deposited with the Court; ordering defendant to pay the sum of P3,000.00 as reasonable compensation for the use and occupancy of the premises from January 1994 until defendant shall have finally vacated the premises minus whatever amount deposited with the Court as rental; ordering defendant to pay reasonable attorneys fees in the amount of P2,000.00 and the costs of suit. IN CIVIL CASE NO. 142258 WHEREFORE, judgment is hereby rendered in favor of plaintiff [RODIL ENTERPRISES, INC.], ordering defendant [DIVISORIA FOOTWEAR], its representatives, agents, employees and/or assigns to vacate the leased premises or portion of the Ides ORacca Building presently occupied by said defendant and to pay plaintiff the following: a) Rentals in arrears from October 1987 to June 1993 in the amount of P521,000.00; b) Rentals in the amount of P9,000.00 a month from July, 1993 until defendant will have vacated the premises; c) Attorneys fees in the amount of P15,000.00; d) Costs of suit. IN CIVIL CASE NO. 142282-CV IN VIEW THEREOF, judgment is hereby rendered ordering: 1. defendant CHUA HUAY SOON and all persons claiming rights through him, to vacate the premises occupied by him at ORACCA Building, located at the corner of Folgueras and M. delos Santos Str eet, Binondo, Manila, and turn over possession thereof to plaintiff RODIL ENTERPRISES, INC.; 2. defendant to pay rentals in arrears from October 1987 up to June 1993 at the rate of P6,175.00 a month, representing the rentals in arrears; 3. defendant to pay P6,175.00 per month from July 1993 until he vacates the premises, as reasonable compensation for the use of the premises; 4. defendant to pay the sum of P20,000.00 as attorneys fees; 5. defendant to pay interests on the amounts mentioned in Nos. 2 and 3 above at ten (10%) percent per annum from the date of the filing of the complaint until said amounts are fully paid; and, 6. defendant to pay the costs. The Regional Trial Court affirmed the Metropolitan Trial Court[28] in all the four (4) decisions above quoted. Thus, respondents Bondoc, Bondoc-Esto and Divisoria Footwear subsequently filed a Petition for Review with the Court of Appeals,[29] followed by respondent Chua Huay Soon.[30] While the consolidated appeals from the unlawful detainer cases were pending, the Second Division of the Court of Appeals promulgated its decision on 12 April 1996 with regard to CA-G.R. No. 39919 declaring the renewal contract between RODIL and

the REPUBLIC null and void.[31] RODIL moved for reconsideration but its motion was denied.[32] Hence, this petition for review on certiorari under Rule 45.[33] On 29 November 1996 the Special Fourth Division of the Court of Appeals promulgated its Decision in CA-G.R. No. 36381 and CA-G.R. No. 37243 setting aside the decisions of the Regional Trial Court, which sustained the Metropolitan Trial Court, and dismissing the action for unlawful detainer filed by RODIL against its lessees.[34] RODIL moved for reconsideration but the motion was denied.[35] Hence, this petition for review on certiorari.[36] On respondents' motion, G.R. Nos. 129609 and 135537 were consolidated. RODIL now contends that the Court of Appeals erred in annulling its renewal contract with the REPUBLIC and in dismissing its actions for unlawful detainer against respondents Bondoc, Bondoc-Esto, Divisoria Footwear and Chua. RODIL claims that the assailed contracts are neither void nor voidable as the facts show they do not fall within the enumerations under Arts. 1305 and 1409, and an implied new lease still exists by virtue of Art. 1670. As a result, the right to eject respondents properly belongs to it.[37] With regard to CA-G.R. No. 39919, RODIL argues that the REPUBLIC, the only defendant who is a real party in interest, signified its assent to having the action dismissed. Assuming arguendo that the ASSOCIATION was a real party in interest, its counterclaim was nonetheless unmeritorious.[38] On the other hand, respondents Bondoc, Bondoc-Esto, Divisoria Footwear and Chua contend that the lease contract which the lease contract of 18 May 1992 was to renew, never came into existence. Therefore, since there was no contract to "renew," the renewal contract had no leg to stand on, hence, is also void.[39] Respondents then conclude that since there was no lease contract to speak of, RODIL had no right to relief in its action for unlawful detainer. The ASSOCIATION, for its part, argues that the counterclaim it filed against RODIL cannot be dismissed because the trial court has not passed upon it.[40] We rule for RODIL. The owner has the right to enjoy and dispose of a thing, without other limitations than those established by law.[41] Every owner has the freedom of disposition over his property. It is an attribute of ownership, and this rule has no exception. The REPUBLIC being the owner of the disputed property enjoys the prerogative to enter into a lease contract with RODIL in the exercise of its jus disponendi. Hence, as lessor, the REPUBLIC has the right to eject usurpers of the leased property where the factual elements required for relief in an action for unlawful detainer are present. Private respondents claim that the agreements of 23 September 1987, 18 May 1992 and 25 May 1992 did not give rise to valid contracts.[42] This is true only of the Contract of Lease entered into on 23 September 1987 which the REPUBLIC did not approve. RODIL neither alleged nor proved that such approval was made known to it.

The so-called approval of the lease contract was merely stated in an internal memorandum of Secretary De Jesus addressed to Director Factora.[43] This is evident from the fact that Secretary De Jesus, in his letter, asked Factora to duly execute a lease contract and forward it to his office for approval.[44] The consequences of this fact are clear. The Civil Code provides that no contract shall arise unless acceptance of the contract is communicated to the offeror.[45] Until that moment, there is no real meeting of the minds, no concurrence of offer and acceptance, hence, no contract.[46] However, the same is not true of the contracts of 18 May 1992 and 25 May 1992. As argued by RODIL, these contracts are not proscribed by law; neither is there a law prohibiting the execution of a contract with provisions that are retroactive. Where there is nothing in a contract that is contrary to law, morals, good customs, public policy or public order, the validity of the contract must be sustained.[47] The Court of Appeals invalidated the contracts because they were supposedly executed in violation of a temporary restraining order issued by the Regional Trial Court.[48] The appellate court however failed to note that the order restrains the REPUBLIC from awarding the lease contract only as regards respondent ASSOCIATION but not petitioner RODIL. While a temporary restraining order was indeed issued against RODIL, it was issued only on 25 May 1992 or after the assailed contracts were entered into. As correctly stated by petitioner, one cannot enjoin an act already fait accompli.[49] Private respondents argue that the "renewal contract" cannot "renew" a void contract. However, they could cite no legal basis for this assertion. It would seem that respondents consider the renewal contract to be a novation of the earlier lease contract of 23 September 1987. However, novation is never presumed.[50] Also, the title of a contract does not determine its nature. On the contrary, it is the specific provisions of the contract which dictate its nature.[51] Furthermore, where a contract is susceptible of two (2) interpretations, one that would make it valid and another that would make it invalid, the latter interpretation is to be adopted.[52] The assailed agreement of 18 May 1992, "Renewal of Contract of Lease," merely states that the term of the contract would be for ten (10) years starting 1 September 1987. This is hardly conclusive of the existence of an intention by the parties to novate the contract of 23 September 1987. Nor can it be argued that there is an implied novation for the requisite incompatibility between the original contract and the subsequent one is not present.[53] Based on this factual milieu, the presumption of validity of contract cannot be said to have been overturned. Respondent ASSOCIATION claims that the Decision of the Office of the President declaring null and void the lease contracts of 18 May 1992 and 25 May 1992 should be counted in its favor. We do not agree. The contention does not hold water. It is well-settled that a court's judgment in a case shall not adversely affect persons who were not parties thereto.

Respondent ASSOCIATION finally argues that the 18 May 1992 and 25 May 1992 contracts can be considered rescissible because they concern property under litigation and were entered into without the knowledge and approval of the litigants or of competent judicial authority.[54] Civil Case No. 87-42323 involved an action for specific performance and damages filed by RODIL against the REPUBLIC and the ASSOCIATION. The right to file the action for rescission arises in favor of the plaintiff when the defendant enters into a contract over the thing under litigation without the knowledge and approval of the plaintiff or the court. The right of action therefore arose in favor of petitioner RODIL and not respondent ASSOCIATION. Having preliminarily dealt with the validity of the lease contracts, we now proceed to resolve the issue raised by respondent ASSOCIATION with regard to its counterclaim. The ASSOCIATION argues that its counterclaim should not have been dismissed. On this point, we agree. The requisites for the application of Rule 17 of the Rules of Civil Procedure are clearly present.[55] The counterclaim is necessarily connected with the transaction that is the subject matter of the claim. In malicious prosecution, there must be proof that the prosecution was prompted by a sinister design to vex and humiliate a person, and that it was initiated deliberately by the defendant knowing that his charge was false and groundless.[56] A determination of whether the charge is groundless would necessarily involve an analysis of whether the action instituted by RODIL is meritorious. The counterclaim did not require the presence of third parties over which the court could not acquire jurisdiction, and that the court had jurisdiction over the subject matter of the counterclaim since the amount of damages claimed by the ASSOCIATION in its counterclaim amounted to P3,500,000.00, clearly within the jurisdictional amount for the Regional Trial Court under BP 129. However, in the interest of making a final adjudication on an issue which has been pending for fourteen (14) years, we will rule on the issues raised by the ASSOCIATION in its counterclaim, and accordingly deny the same, dispensing with any discussion regarding the merits of RODIL's cause of action which is clearly neither "false" nor "groundless." Therefore, the elements of malicious prosecution are absent. As regards the action for unlawful detainer, respondents Bondoc, Bondoc-Esto, Divisoria Footwear and Chua argue that this should not prosper because RODIL is not in actual possession of the property and because they are not its sublessees.[57] Their arguments do not convince. In an action for unlawful detainer the plaintiff need not have been in prior physical possession. Respondents have admitted that they have not entered into any lease contract with the REPUBLIC and that their continued occupation of the subject property was merely by virtue of acquiescence.[58] The records clearly show this to be the case. The REPUBLIC merely issued a "temporary occupancy permit" which was not even in the name of the respondents Bondoc, Bondoc-Esto, Divisoria Footwear or Chua but of respondent ASSOCIATION. Since the occupation of respondents was merely

tolerated by the REPUBLIC, the right of possession of the latter remained uninterrupted. It could therefore alienate the same to anyone it chose. Unfortunately for respondents, the REPUBLIC chose to alienate the subject premises to RODIL by virtue of a contract of lease entered into on 18 May 1992. Resultantly, petitioner had the right to file the action for unlawful detainer against respondents as one from whom possession of property has been unlawfully withheld. Respondents finally argue that petitioner failed to comply with the mandatory provisions of Rule 45 so that its petition must be dismissed. They allege that petitioner failed to state in its petition that a motion for reconsideration was filed, the date of filing, when the motion was denied, and the date when the resolution denying the motion was received. A cursory review of RODIL's petition belies respondents' assertion. All dates required under Rule 45, Sec. 4, are properly indicated except when the motion for reconsideration was filed. Procedural rules are required to be followed as a general rule, but they may be relaxed to relieve a litigant of an injustice not commensurate with the degree of his noncompliance with the procedure required. Dismissal of appeals purely on technical grounds is frowned upon and the rules of procedure ought not to be applied in a very rigid, technical sense, for they are adopted to help secure, not override, substantial justice, and thereby defeat their very aims. The rules have been drafted with the primary objective of enhancing fair trials and expediting the proper dispensation of justice. As a corollary, if their application and operation tend to subvert and defeat, instead of promote and enhance its objective, suspension of the rules is justified.[59] Petitioner did not repeat its error in its later petition filed under G.R. No. 135537. The oversight must be fashioned with leniency. WHEREFORE, the consolidated petitions are GRANTED. The assailed Decisions of the Court of Appeals in CA-G.R. Nos. 36381, 37243 and 39919 are REVERSED and SET ASIDE. Accordingly, the Decisions of the Regional Trial Court, Br. 39, in Civil Cases Nos. 94-70776, 94-71122 and 94-71123 as well as the Decision of the Regional Trial Court, Br. 23, in Civil Case No. 94-72209 affirming in toto the Decisions of the MeTC - Br. 28 in Civil Case No. 143301, MeTC - Br. 15 in Civil Case No. 143216, MeTC - Br. 7 in Civil Case No. 142258, and MeTC - Br. 24 in Civil Case No. 142282-CV, as herein quoted, and the Orders dated 14 August 1992 and 6 November 1992 of the Regional Trial Court, Br. 8 in Civil Case No. 87-42323, recognizing the validity and legality of the Renewal of the Lease Contract dated 18 May 1992 and the Supplemental Contract dated 25 May 1992, are REINSTATED, AFFIRMED and ADOPTED. Costs against private respondents in both cases. SO ORDERED. Mendoza, Quisumbing, Buena, and De Leon, Jr., JJ., concur.

Republic of the PhilippinesSUPREME COURTManila

THIRD DIVISION G.R. No. 138053 May 31, 2000 CORNELIO M. ISAGUIRRE, petitioner,vs. FELICITAS DE LARA, respondent.

the issuance of Original Certificate of Title No. P-11566 on February 13, 1984, in the name of petitioner. Meanwhile, the sales application of respondent over the entire 1,000 square meters of subject property (including the 250 square meter portion claimed by petitioner) was also given due course, resulting in the issuance of Original 4 Certificate of Title No. P-13038 on June 19, 1989, in the name of respondent. Due to the overlapping of titles, petitioner filed an action for quieting of title and damages with the Regional Trial Court of Davao City against respondent on May 17, 1990. The case was docketed as Civil Case No. 20124-90. After trial on the merits, the trial court rendered judgment on October 19, 1992, in favor of petitioner, declaring him to be the lawful owner of the disputed property. However, the Court of Appeals reversed the trial court's decision, holding that the transaction entered into by the 5 parties, as evidenced by their contract, was an equitable mortgage, not a sale. The appellate court's decision was based on the inadequacy of the consideration agreed upon by the parties, on its finding that the payment of a large portion of the "purchase price" was made after the execution of the deed of sale in several installments of minimal amounts; and finally, on the fact that petitioner did not take steps to confirm his rights or to obtain title over the property for several years after the execution of the deed of sale. As a consequence of its decision, the appellate court also declared Original Certificate of Title No. P-11566 issued in favor of petitioner to be null and void. On July 8, 1996, in a case docketed as G.R. No. 120832, this Court affirmed the decision of the Court of Appeals and on September 11, 1996, we denied petitioner's motion for reconsideration. On May 5, 1997, respondent filed a motion for execution with the trial court, praying for the immediate delivery of possession of the subject property, which motion was granted on August 18, 1997. On February 3, 1998, respondent moved for a writ of possession, invoking our ruling in G.R. No. 120832. Petitioner opposed the motion, asserting that he had the right of retention over the property until payment of the loan and the value of the improvements he had introduced on the property. On March 12, 1998, the trial court granted respondent's motion for writ of possession. Petitioner's motion for reconsideration was denied by the trial court on May 21, 1998. Consequently, a writ of possession dated June 16, 1998, together with the Sheriff's Notice to Vacate dated July 7, 1998, were served upon petitioner. Petitioner filed with the Court of Appeals a special civil action for certiorari and prohibition with prayer for a temporary restraining order or preliminary injunction to annul and set aside the March 12, 1998 and May 21, 1998 orders of the trial court, including the writ of possession dated June 16, 1998 and the sheriff's notice to vacate 6 dated July 7, 1998. The appellate court summarized the issues involved in the case as follows: (1) whether or not the mortgagee in an equitable mortgage has the right to retain possession of the property pending actual payment to him of the amount of indebtedness by the mortgagor; and (b) whether or not petitioner can be considered a builder in good faith

GONZAGA-REYES, J.: In this petition for review on certiorari under Rule 45 of the 1997 Revised Rules of Civil 1 Procedure, petitioner Cornelio M. Isaguirre assails the October 5, 1998 decision of the 2 Court of Appeals and its Resolution promulgated on March 5, 1999. The antecedent facts of the present case are as follows: Alejandro de Lara was the original applicant-claimant for a Miscellaneous Sales Application over a parcel of land identified as portion of Lot 502, Guianga Cadastre, filed with the Bureau of Lands on January 17, 1942 and with an area of 2,324 square meters. Upon his death, Alejandro de Lara was succeeded by his wife respondent Felicitas de Lara, as claimant. On November 19, 1954, the Undersecretary of Agriculture and Natural Resources amended the sales application to cover only 1,600 square meters. Then, on November 3, 1961, by virtue of a decision rendered by the Secretary of Agriculture and Natural Resources dated November 19, 1954, a subdivision survey was made and the area was further reduced to 1,000 square meters. On this lot stands a two-story residential-commercial apartment declared for taxation purposes under TD 43927 in the name of respondent's sons Apolonio and Rodolfo, both surnamed de Lara. Sometime in 1953, respondent obtained several loans from the Philippine National Bank. When she encountered financial difficulties, respondent approached petitioner Cornelio M. Isaguirre, who was married to her niece, for assistance. On February 10, 1960, a document denominated as "Deed of Sale and Special Cession of Rights and Interests" was executed by respondent and petitioner, whereby the former sold a 250 square meter portion of Lot No. 502, together with the two-story commercial and residential structure standing thereon, in favor of petitioner, for and in consideration of the sum of P5,000. Sometime in May, 1968, Apolonio and Rodolfo de Lara filed a complaint against 3 petitioner for recovery of ownership and possession of the two-story building. However, the case was dismissed for lack of jurisdiction. On August 21, 1969, petitioner filed a sales application over the subject property on the basis of the deed of sale. His application was approved on January 17, 1984, resulting in

with respect to the improvements he made on the property before the transaction was declared to be an equitable mortgage. The Court of Appeals held that petitioner was not entitled to retain possession of the subject property. It said that . . . the mortgagee merely has to annotate his claim at the back of the certificate of title in order to protect his rights against third persons and thereby secure the debt. There is therefore no necessity for him to actually possess the property. Neither should a mortgagee in an equitable mortgage fear that the contract relied upon is not registered and hence, may not operate as a mortgage to justify its foreclosure. In Feliza Zubiri v. Lucio Quijano, 74 Phil 47, it was ruled "that when a contract . . . is held as an equitable mortgage, the same shall be given effect as if it had complied with the formal requisites of mortgage. . . . by its very nature the lien thereby created ought not to be defeated by requiring compliance with the formalities necessary to the validity of a voluntary real estate mortgage, as long as the land remains in the hands of the petitioner (mortgagor) and the rights of innocent parties are not affected. Proceeding from the foregoing, petitioner's imagined fears that his lien would be lost by surrendering possession are unfounded. In the same vein, there is nothing to stop the mortgagor de Lara from acquiring possession of the property pending actual payment of the indebtedness to petitioner. This does not in anyway endanger the petitioner's right to security since, as pointed out by private respondents, the petitioner can always have the equitable mortgage annotated in the Certificate of Title of private respondent and pursue the legal remedies for the collection of the alleged debt secured by the mortgage. In this case, the remedy would be to foreclose the mortgage upon failure to pay the debt within the required period. It is unfortunate however, that the Court of Appeals, in declaring the transaction to be an equitable mortgage failed to specify in its Decision the period of time within which the private respondent could settle her account, since such period serves as the reckoning point by which foreclosure could ensue. As it is, petitioner is now in a dilemma as to how he could enforce his rights as a mortgagee. . . . Hence, this Court, once and for all resolves the matter by requiring the trial court to determine the amount of total indebtedness and the period within which payment shall be made. Petitioner's claims that he was a builder in good faith and entitled to reimbursement for the improvements he introduced upon the property were rejected by the Court of Appeals. It held that petitioner knew, or at least had an inkling, that there was a defect or flaw in his mode of acquisition. Nevertheless, the appellate court declared petitioner to have the following rights:

. . . He is entitled to reimbursement for the necessary expenses which he may have incurred over the property, in accordance with Art. 526 and Art. 452 of the Civil Code. Moreover, considering that the transaction was merely an equitable mortgage, then he is entitled to payment of the amount of indebtedness plus interest, and in the event of non-payment to foreclose the mortgage. Meanwhile, pending receipt of the total amount of debt, private respondent is entitled to possession over the disputed property. The case was finally disposed of by the appellate court in the following manner: WHERFORE, the Petition is hereby DISMISSED, and this case is ordered remanded to the Regional Trial Court of Davao City for further proceedings, as follows: 1) The trial court shall determine a) The period within which the mortgagor must pay his total amount of indebtedness. b) The total amount of indebtedness owing the petitioner-mortgagee plus interest computed from the time when the judgment declaring the contract to be an equitable mortgage became final. c) The necessary expenses incurred by petitioner over the property.
7

On March 5, 1999, petitioner's motion for reconsideration was denied by the appellate 8 court. Hence, the present appeal wherein petitioner makes the following assignment of errors: A. THE HONORABLE COURT OF APPEALS ERRED IN NOT RULING THAT THE RTC ACTED WITHOUT OR IN EXCESS OF ITS JURISDICTION OR WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION IN ISSUING A WRIT OF POSSESSION IN FAVOR OF RESPONDENT. A.1 The RTC patently exceeded the scope of its authority and acted with grave abuse of discretion in ordering the immediate delivery of possession of the Property to respondent as said order exceeded the parameters of the final and executory decision and constituted a variance thereof. B. THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT PETITIONER IS NOT ENTITLED TO THE POSSESSION OF THE PROPERTY PRIOR TO THE PAYMENT OF RESPONDENT'S MORTGAGE LOAN. C. THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT PETITIONER WAS NOT A BUILDER IN GOOD FAITH.

D. THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT PETITIONER IS ENTITLED TO INTEREST COMPUTED ONLY FROM THE TIME WHEN THE JUDGMENT 9 DECLARING THE CONTRACT TO BE AN EQUITABLE MORTGAGE BECAME FINAL. Basically, petitioner claims that he is entitled to retain possession of the subject property until payment of the loan and the value of the necessary and useful 10 improvements he made upon such property. According to petitioner, neither the Court of Appeals' decision in G.R. CV No. 42065 nor this Court's decision in G.R. No. 120832 ordered immediate delivery of possession of the subject property to respondent. The dispositive portion of the March 31, 1995 decision of the Court of Appeals in G.R. CV No. 42065, which was affirmed by this Court, provides that IN VIEW OF ALL THE FOREGOING, the judgment appealed from is REVERSED and SET ASIDE and a new one entered: (1) dismissing the complaint; (2) declaring the "Document of Sale and Special Cession of Rights and Interests" (Exhibit B) dated February 10, 1960, to be an equitable mortgage not a sale; (3) upholding the validity of OCT No. P-13038 in the name of Felicitas de Lara; and (3) declaring null and void OCT No. P-11566 in the name of plaintiff Cornelio Isaguirre. All other counterclaims for damages are likewise 11 dismissed. Costs against the appellee. Petitioner argues that the abovementioned decision merely settled the following matters: (1) that the transaction between petitioner and respondent was not a sale but an equitable mortgage; (2) that OCT No. P-13038 in the name of respondent is valid; and (3) that OCT No. P-11566 in the name of petitioner is null and void. Since the aforementioned decision did not direct the immediate ouster of petitioner from the subject property and the delivery thereof to respondent, the issuance of the writ of possession by the trial court on June 16, 1998 constituted an unwarranted modification 12 or addition to the final and executory decision of this Court in G.R. No. 120832. We do not agree with petitioner's contentions. On the contrary, the March 31, 1995 decision of the appellate court, which was affirmed by this Court on July 8, 1996, served as more than adequate basis for the issuance of the writ of possession in favor of respondent since these decisions affirmed respondent's title over the subject property. As the sole owner, respondent has the right to enjoy her property, without any other 1 limitations than those established by law. Corollary to such right, respondent also has the right to exclude from the possession of her property any other person to whom she 14 has not transmitted such property. It is true that, in some instances, the actual possessor has some valid rights over the property enforceable even against the owner thereof, such as in the case of a tenant or 15 lessee. Petitioner anchors his own claim to possession upon his declared status as a mortgagee. In his Memorandum, he argues that

4.8 It was respondent who asserted that her transfer of the Property to petitioner was by way of an equitable mortgage and not by sale. After her assertion was sustained by the Courts, respondent cannot now ignore or disregard the legal effects of such judicial declaration regarding the nature of the transaction. xxx xxx xxx 4.13 Having delivered possession of the Property to petitioner as part of the constitution of the equitable mortgage thereon, respondent is not entitled to the return of the Property unless and until the mortgage loan is discharged by full payment thereof. Petitioner's right as mortgagee to retain possession of the Property so long as the mortgage loan remains unpaid is further supported by the rule that a mortgage may not be extinguished even though then mortgagor-debtor may have made partial payments on the mortgage loan: Art. 2089. A pledge or mortgage is indivisible, even though the debt may be divided among the successors in interest of the debtor or the creditor. Therefore, the debtor's heir who has paid a part of the debt cannot ask for the proportionate extinguishment of the pledge or mortgage as long as the debt is not completely satisfied. Neither can the creditor's heir who has received his share of the debt return the pledge or cancel the mortgage, to the prejudice of the other heirs who have not been paid. (Emphasis supplied.) xxx xxx xxx 4.14 To require petitioner to deliver possession of the Property to respondent prior to the full payment of the latter's mortgage loan would be equivalent to the cancellation of the mortgage. Such effective cancellation would render petitioner's rights ineffectual and nugatory and would constitute unwarranted judicial interference. xxx xxx xxx 4.16 The fact of the present case show that respondent delivered possession of the Property to petitioner upon the execution of the Deed of Absolute Sale and Special Cession of Rights and Interest dated 10 February 1960. Hence, transfer of possession of the Property to petitioner was an essential part of whatever agreement the parties entered into, which, in this case, the Supreme Court affirmed to be an equitable mortgage. xxx xxx xxx

4.19 Petitioner does not have the mistaken notion that the mortgagee must be in actual possession of the mortgaged property in order to secure the debt. However, in this particular case, the delivery of possession of the Property was an integral part of the contract between petitioner and respondent. After all, it was supposed to be a contract of sale. If delivery was not part of the agreement entered into by the parties in 1960, why did respondent surrender possession thereof to petitioner in the first place? 4.20 Now that the Courts have ruled that the transaction was not a sale but a mortgage, petitioner's entitlement to the possession of the Property should be deemed as one of the provisions of the mortgage, considering that at the time the contract was entered into, possession of the Property was likewise delivered to petitioner. Thus, until respondent has fully paid her mortgage loan, petitioner should be allowed to retain 16 possession of the subject property. Petitioner's position lacks sufficient legal and factual moorings. A mortgage is a contract entered into in order to secure the fulfillment of a principal 17 obligation. It is constituted by recording the document in which it appears with the proper Registry of Property, although, even if it is not recorded, the mortgage is 18 nevertheless binding between the parties. Thus, the only right granted by law in favor of the mortgagee is to demand the execution and the recording of the document in 19 which the mortgage is formalized. As a general rule, the mortgagor retains possession of the mortgaged property since a mortgage is merely a lien and title to the property 20 does not pass to the mortgagee. However, even though a mortgagee does not have possession of the property, there is no impairment of his security since the mortgage directly and immediately subjects the property upon which it is imposed, whoever the possessor may be, to the fulfillment of the obligation for whose security it was 21 constituted. If the debtor is unable to pay his debt, the mortgage creditor may institute an action to foreclose the mortgage, whether judicially or extrajudicially, whereby the mortgaged property will then be sold at a public auction and the proceeds therefrom given to the creditor to the extent necessary to discharge the mortgage loan. Apparently, petitioner's contention that "[t]o require [him] . . . to deliver possession of the Property to respondent prior to the full payment of the latter's mortgage loan would be equivalent to the cancellation of the mortgage" is without basis. Regardless of its possessor, the mortgaged property may still be sold, with the prescribed formalities, in the event of the debtor's default in the payment of his loan obligation. Moreover, this Court cannot find any justification in the records to uphold petitioner's contention that respondent delivered possession of the subject property upon the execution of the "Deed of Sale and Special Cession of Rights and Interests" on February 10, 1960 and that the transfer of possession to petitioner must therefore be considered an essential part of the agreement between the parties. This self-serving assertion of 22 petitioner was directly contradicted by respondent in her pleadings. Furthermore, nowhere in the Court of Appeals' decisions promulgated on March 31, 1995 (G.R. CV No. 42065) and on October 5, 1998 (G.R. SP No. 48310), or in our own decision promulgated

on July 8, 1996 (G.R. No. 120832) was it ever established that the mortgaged properties were delivered by respondent to petitioner. In Alvano v. Batoon, this Court held that "[a] simple mortgage does not give the mortgagee a right to the possession of the property unless the mortgage should contain some special provision to that effect." Regrettably for petitioner, he has not presented any evidence, other than his own gratuitous statements, to prove that the real intention of the parties was to allow him to enjoy possession of the mortgaged property until full payment of the loan. Therefore, we hold that the trial court correctly issued the writ of possession in favor of respondent. Such writ was but a necessary consequence of this Court's ruling in G.R. No. 120832 affirming the validity of the original certificate of title (OCT No. P-13038) in the name of respondent Felicitas de Lara, while at the same time nullifying the original certificate of title (OCT No. P-11566) in the name of petitioner Cornelio Isaguirre. Possession is an essential attribute of ownership; thus, it would be redundant for respondent to go back to court simply to establish her right to possess subject property. Contrary to petitioner's claims, the issuance of the writ of possession by the trial court did not constitute an unwarranted modification of our decision in G.R. No. 120832, but 24 rather, was a necessary complement thereto. It bears stressing that a judgment is not confined to what appears upon the face of the decision, but also those necessarily 25 included therein or necessary thereto. With regard to the improvements made on the mortgaged property, we confirm the Court of Appeals' characterization of petitioner as a possessor in bad faith. Based on the factual findings of the appellate court, it is evident that petitioner knew from the very beginning that there was really no sale and that he held respondent's property as mere security for the payment of the loan obligation. Therefore, petitioner may claim reimbursement only for necessary expenses; however, he is not entitled to 26 27 reimbursement for any useful expenses which he may have incurred. Finally, as correctly pointed out by the Court of Appeals, this case should be remanded to the Regional Trial Court of Davao City for a determination of the total amount of the loan, the necessary expenses incurred by petitioner, and the period within which 28 respondent must pay such amount. However, no interest is due on the loan since 29 there has been no express stipulation in writing. WHEREFORE, the assailed Decision of the Court of Appeals dated October 5, 1998 and its Resolution dated March 5, 1999 are hereby AFFIRMED. Respondent is entitled to delivery of possession of the subject property. This case is hereby REMANDED to the trial court for determination of the amount of the loan, the necessary expenses incurred by petitioner and the period within which the respondent must pay the same. SO ORDERED.
2

[G.R. No. 116100. February 9, 1996]

length from plaintiff Mabasas residence to P. Burgos Street; it is about 26 meters. In passing thru said passageway, a less than a meter wide path through the septic tank and with 5-6 meters in length has to be traversed. When said property was purchased by Mabasa, there were tenants occupying the premises and who were acknowledged by plaintiff Mabasa as tenants. However, sometime in February, 1982. one of said tenants vacated the apartment and when plaintiff Mabasa went to see the premises, he saw that there had been built an adobe fence in the first passageway making it narrower in width . Said adobe fence was first constructed by defendants Santoses along their property which is also along the first passageway. Defendant Morato constructed her adobe fence and even extended said fence in such a way that the entire passageway was enclosed (Exhibit 1-Santoses and Custodios, Exh. D for plaintiff, Exhs. 1-C, 1-D and I -E) And it was then that the remaining tenants of said apartment vacated the area. Defendant Ma. Cristina Santos testified that she constructed said fence because there was an incident when her daughter was dragged by a bicycle pedalled by a son of one of the tenants in said apartment along the first passageway. She also mentioned some other inconveniences of having (at) the front of her house a pathway such as when some of the tenants were drunk and would bang their doors and windows. Some of their footwear were even lost. x x x[3] (Italics in original text; corrections in parentheses supplied) On February 27, 1990, a decision was rendered by the trial court, with this dispositive part: Accordingly, judgment is hereby rendered as follows: 1) Ordering defendants Custodios and Santoses to give plaintiff permanent access ingress and egress, to the public street; 2) Ordering the plaintiff to pay defendants Custodios and Santoses the sum of Eight Thousand Pesos (P8,000) as indemnity for the permanent use of the passageway. The parties to shoulder their respective litigation expenses.[4] Not satisfied therewith, therein plaintiff represented by his heirs, herein private respondents, went to the Court of Appeals raising the sole issue of whether or not the lower court erred in not awarding damages in their favor. On November 10, 1993, as earlier stated, the Court of Appeals rendered its decision affirming the judgment of the trial court with modification, the decretal portion of which disposes as follows: WHEREFORE, the appealed decision of the lower court is hereby AFFIRMED WITH MODIFICATION only insofar as the herein grant of damages to plaintiffs-appellants. The Court hereby orders defendants-appellees to pay plaintiffs-appellants the sum of Sixty Five Thousand (P65,000) Pesos as Actual Damages, Thirty Thousand (P30,000) Pesos as Moral Damages, and Ten Thousand (P10,000) Pesos as Exemplary Damages. The rest of

SPOUSES CRISTINO and BRIGIDA CUSTODIO and SPOUSES LITO and MARIA CRISTINA SANTOS, petitioners, vs. COURT OF APPEALS, HEIRS OF PACIFICO C. MABASA and REGIONAL TRIAL COURT OF PASIG, METRO MANILA, BRANCH 181, respondents. DECISION REGALADO, J.: This petition for review on certiorari assails the decision of respondent Court of Appeals in CA-G.R. CV No. 29115, promulgated on November 10, 1993, which affirmed with modification the decision of the trial court, as well as its resolution dated July 8, 1994 denying petitioners motion for reconsideration.[1] On August 26, 1982, Civil Case No. 47466 for the grant of an easement of right of way was filed by Pacifico Mabasa against Cristino Custodio, Brigida R. Custodio, Rosalina R. Morato, Lito Santos and Maria Cristina C. Santos before the Regional Trial Court of Pasig and assigned to Branch 22 thereof.[2] The generative facts of the case, as synthesized by the trial court and adopted by the Court of Appeals, are as follows: Perusing the record, this Court finds that the original plaintiff Pacifico Mabasa died during the pendency of this case and was substituted by Ofelia Mabasa, his surviving spouse [and children]. The plaintiff owns a parcel of land with a two-door apartment erected thereon situated at Interior P. Burgos St., Palingon, Tipas, Taguig, Metro Manila. The plaintiff was able to acquire said property through a contract of sale with spouses Mamerto Rayos and Teodora Quintero as vendors last September 1981. Said property may be described to be surrounded by other immovables pertaining to defendants herein. Taking P. Burgos Street as the point of reference, on the left side, going to plaintiffs property, the row of houses will be as follows: That of defendants Cristino and Brigido Custodio, then that of Lito and Maria Cristina Santos and then that of Ofelia Mabasa. On the right side (is) that of defendant Rosalina Morato and then a Septic Tank (Exhibit D). As an access to P. Burgos Street from plaintiffs property, there are two possible passageways. The first passageway is approximately one meter wide and is about 20 meters distan(t) from Mabasas residence to P. Burgos Street. Such path is passing in between the previously mentioned row of houses. The second passageway is about 3 meters in width and

the appealed decision is affirmed to all respects.[5] On July 8, 1994, the Court of Appeals denied petitioners motion for reconsideration.[6] Petitioners then took the present recourse to us, raising two issues, namely, whether or not the grant of right of way to herein private respondents is proper, and whether or not the award of damages is in order. With respect to the first issue, herein petitioners are already barred from raising the same. Petitioners did not appeal from the decision of the court a quo granting private respondents the right of way, hence they are presumed to be satisfied with the adjudication therein. With the finality of the judgment of the trial court as to petitioners, the issue of propriety of the grant of right of way has already been laid to rest. For failure to appeal the decision of the trial court to the Court of Appeals, petitioners cannot obtain any affirmative relief other than those granted in the decision of the trial court. That decision of the court below has become final as against them and can no longer be reviewed, much less reversed, by this Court. The rule in this jurisdiction is that whenever an appeal is taken in a civil case, an appellee who has not himself appealed may not obtain from the appellate court any affirmative relief other than what was granted in the decision of the lower court. The appellee can only advance any argument that he may deem necessary to defeat the appellants claim or to uphold the decision that is being disputed, and he can assign errors in his brief if such is required to strengthen the views expressed by the court a quo. These assigned errors, in turn, may be considered by the appellate court solely to maintain the appealed decision on other grounds, but not for the purpose of reversing or modifying the judgment in the appellees favor and giving him other affirmative reliefs.*7+ However, with respect to the second issue, we agree with petitioners that the Court of Appeals erred in awarding damages in favor of private respondents. The award of damages has no substantial legal basis. A reading of the decision of the Court of Appeals will show that the award of damages was based solely on the fact that the original plaintiff, Pacifico Mabasa, incurred losses in the form of unrealized rentals when the tenants vacated the leased premises by reason of the closure of the passageway. However, the mere fact that the plaintiff suffered losses does not give rise to a right to recover damages. To warrant the recovery of damages, there must be both a right of action for a legal wrong inflicted by the defendant, and damage resulting to the plaintiff therefrom. Wrong without damage, or damage without wrong, does not constitute a cause of action, since damages are merely part of the remedy allowed for the injury caused by a breach or wrong.[8] There is a material distinction between damages and injury. Injury is the illegal invasion of a legal right; damage is the loss, hurt, or harm which results from the injury; and damages are the recompense or compensation awarded for the damage suffered. Thus, there can be damage without injury in those instances in which the loss or harm was not the result of a violation of a legal duty. These situations are often

called damnum absque injuria.[9] in order that a plaintiff may maintain an action for the injuries of which he complains, he must establish that such injuries resulted from a breach of duty which the defendant owed to the plaintiff - a concurrence of injury to the plaintiff and legal responsibility by the person causing it.[10] The underlying basis for the award of tort damages is the premise that an individual was injured in contemplation of law. Thus, there must first be the breach of some duty and the imposition of liability for that breach before damages may be awarded; it is not sufficient to state that there should be tort liability merely because the plaintiff suffered some pain and suffering)[11] Many accidents occur and many injuries are inflicted by acts or omissions which cause damage or loss to another but which violate no legal duty to such other person, and consequently create no cause of action in his favor. In such cases, the consequences must be borne by the injured person alone. The law affords no remedy for damages resulting from an act which does not amount to a legal injury or wrong. [12] In other words, in order that the law will give redress for an act causing damage, that act must be not only hurtful, but wrongful. There must be damnum et injuria.[13] If, as may happen in many cases, a person sustains actual damage, that is, harm or loss to his person or property, without sustaining any legal injury, that is, an act or omission which the law does not deem an injury, the damage is regarded as damnum absque injuria.[14] In the case at bar, although there was damage, there was no legal injury. Contrary to the claim of private respondents, petitioners could not be said to have violated the principle of abuse of right. In order that the principle of abuse of right provided in Article 21 of the Civil Code can be applied, it is essential that the following requisites concur: (1) The defendant should have acted in a manner that is contrary to morals, good customs or public policy; (2) The acts should be willful; and (3) There was damage or injury to the plaintiff.[15] The act of petitioners in constructing a fence within their lot is a valid exercise of their right as owners, hence not contrary to morals, good customs or public policy. The law recognizes in the owner the right to enjoy and dispose of a thing, without other limitations than those established by law.[16] It is within the right of petitioners, as owners, to enclose and fence their property. Article 430 of the Civil Code provides that (e)very owner may enclose or fence his land or tenements by means of walls, ditches, live or dead hedges, or by any other means without detriment to servitudes constituted thereon. At the time of the construction of the fence, the lot was not subject to any servitudes. There was no easement of way existing in favor of private respondents, either by law or by contract. The fact that private respondents had no existing right over the said passageway is confirmed by the very decision of the trial court granting a compulsory right of way in their favor after payment of just compensation. It was only that decision which gave private respondents the right to use the said passageway after payment of the compensation and imposed a corresponding duty on petitioners not to

interfere in the exercise of said right. Hence, prior to said decision, petitioners had an absolute right over their property and their act of fencing and enclosing the same was an act which they may lawfully perform in the employment and exercise of said right. To repeat, whatever injury or damage may have been sustained by private respondents by reason of the rightful use of the said land by petitioners is damnum absque injuria.[17] A person has a right to the natural use and enjoyment of his own property, according to his pleasure, for all the purposes to which such property is usually applied. As a general rule, therefore, there is no cause of action for acts done by one person upon his own property in a lawful and proper manner, although such acts incidentally cause damage or an unavoidable loss to another, as such damage or loss is damnum absque injuria.[18] When the owner of property makes use thereof in the general and ordinary manner in which the property is used, such as fencing or enclosing the same as in this case, nobody can complain of having been injured, because the inconvenience arising from said use can be considered as a mere consequence of community life.[19] The proper exercise of a lawful right cannot constitute a legal wrong for which an action will lie,[20] although the act may result in damage to another, for no legal right has been invaded[21] One may use any lawful means to accomplish a lawful purpose and though the means adopted may cause damage to another, no cause of action arises in the latters favor. Any injury or damage occasioned thereby is damnum absque injuria. The courts can give no redress for hardship to an individual resulting from action reasonably calculated to achieve a lawful end by lawful means.[22] WHEREFORE, under the compulsion of the foregoing premises, the appealed decision of respondent Court of Appeals is hereby REVERSED and SET ASIDE and the judgment of the trial court is correspondingly REINSTATED. SO ORDERED. Romero and Puno, JJ., concur. Mendoza, J., took no part.

[G.R. No. 84831. June 20, 2001]

1978.*5+ The last two declarations state that petitioner Abejarons house stands on Lots 1 and 2, Block 5, Psu 154953.[6] Abejaron paid taxes on the house in 1955, 1966, and 1981.[7] Petitioner stated that beginning 1955, respondent Nabasa resided on the remaining 57-square meter portion of Lot 1, Block 5, Psu-154953.[8] Nabasa built his house about four (4) meters away from petitioner Abejaron's house. Beatriz Gusila, a neighbor of the Abejarons and the Nabasas confirmed that when she arrived in Silway in 1949, Nabasa was not yet residing there while Abejaron was already living in their house which stands to this day. Before 1974, employees of the Bureau of Lands surveyed the area in controversy. Abejaron merely watched them do the survey[9] and did not thereafter apply for title of the land on the belief that he could not secure title over it as it was government property.[10] Without his (Abejaron) knowledge and consent, however, Nabasa "clandestinely, willfully, fraudulently, and unlawfully applied for and caused the titling in his name" of the entire Lot 1, Block 5, Psu-154953, including petitioner Abejaron's 118-square meter portion.[11] Petitioner imputes bad faith and fraud on the part of Nabasa because in applying for and causing the titling in his name of Lot 1, Block 5, Psu-154953, Nabasa represented himself to be the actual and lawful possessor of the entire Lot 1, Block 5, including petitioner Abejaron's 118-square meter portion despite knowledge of Abejaron's actual occupation and possession of said portion.[12] On September 24, 1974, Nabasa was issued Original Certificate of Title No. P4140 pursuant to Free Patent No. (XI-4) 2877 covering Lot 1, Block 5, Psu-154953. As the title included petitioner Abejarons 118-square meter portion of the lot, his son, Alejandro Abejaron, representing Matilde Abejaron (petitioner Abejaron's wife), filed a protest with the Bureau of Lands, Koronadal, South Cotabato against Nabasa's title and application. The protest was dismissed on November 22, 1979 for failure of Matilde and Alejandro to attend the hearings.[13] Alejandro claims, however, that they did not receive notices of the hearings. Alejandro filed a motion for reconsideration dated January 10, 1980. Alejandro also filed a notice of adverse claim on January 14, 1980. Subsequently, he requested the Bureau of Lands to treat the motion as an appeal considering that it was filed within the 60-day reglementary period. The motion for reconsideration was endorsed and forwarded by the District Land Office XI-3 of the Bureau of Lands in Koronadal, Cotabato to the Director of Lands in Manila on November 24, 1981.[14] But because the appeal had not been resolved for a prolonged period for unknown reasons, petitioner Abejaron filed on March 12, 1982 an action for reconveyance with damages against respondent Nabasa before Branch 22, Regional Trial Court of General Santos City.[15] On May 10, 1982, petitioner filed a notice of lis pendens.[16] Abner Lagsub, geodetic engineer, testified for the petitioner. Lagsub stated that on March 30, 1980, Alejandro Abejaron hired him to relocate Lot 1, Block 5, Psu-154953, the land in controversy. He surveyed the lot measuring 175 square meters. Fifty-seven (57) square meters of Lot 1 and a portion of the adjoining Lot 3 were occupied by Nabasa's house. This portion was fenced partly by hollow blocks and partly by

PACENCIO ABEJARON, as represented by his Attorney-in-Fact, ALEJANDRO ABEJARON, petitioner, vs. FELIX NABASA and the COURT OF APPEALS, respondents. D E C I S I O N* PUNO, J.: With the burgeoning population comes a heightened interest in the limited land resource, especially so if, as in the case at bar, one's home of many years stands on the land in dispute. It comes as no surprise therefore that while this case involves a small parcel of land, a 118-square meter portion of Lot 1, Block 5, Psu-154953 in Silway, General Santos City, the parties have tenaciously litigated over it for more than twenty years. Petitioner Abejaron filed this petition for review on certiorari to annul the respondent court's Decision dated April 26, 1988 and Resolution dated July 12, 1988 reversing the trial court's decision and declaring respondent Nabasa the owner of the subject lot. The following facts spurred the present controversy: Petitioner Abejaron avers that he is the actual and lawful possessor and claimant of a 118-square meter portion of a 175-square meter residential lot in Silway, General Santos City described as "Block 5, Lot 1, Psu-154953, bounded on the North by Road, on the South by Lot 2 of the same Psu, on the East by Felix Nabasa, and on the West by Road."[1] In 1945, petitioner Abejaron and his family started occupying the 118-square meter land. At that time, the land had not yet been surveyed. They fenced the area and built thereon a family home with nipa roofing and a small store. In 1949, petitioner improved their abode to become a two-storey house measuring 16 x 18 feet or 87.78 square meters made of round wood and nipa roofing.[2] This house, which stands to this day, occupies a portion of Lot 1, Block 5, Psu-154953 and a portion of the adjoining Lot 2 of the same Psu. Lot 2 belongs to petitioners daughter, Conchita Abejaron Abellon. In 1950, the small store was destroyed and in its stead, petitioner Abejaron built another store which stands up to the present. In 1951, he planted five coconut trees on the property in controversy. Petitioner's wife, Matilde Abejaron, harvested coconuts from these trees.[3] Petitioner Abejaron also planted banana and avocado trees. He also put up a pitcher pump.[4] All this time that the Abejarons introduced these improvements on the land in controversy, respondent Nabasa did not oppose or complain about the improvements. Knowing that the disputed land was public in character, petitioner declared only his house, and not the disputed land, for taxation purposes in 1950, 1966, 1976, and

bamboo. On the remaining 118 square meters stood a portion of petitioner Abejarons house and two coconut trees near it, and his store. Abejaron's 118-square meter portion was separated from Nabasa's 57-square meter part by Abejaron's fence made of hollow blocks. Both Nabasas and Abejarons houses appeared more than twenty years old while the coconut trees appeared about 25 years old. Back in 1971, Lagsub conducted a subdivision survey on Psu-154953. He was then hired by the Silway Neighborhood Association to conduct the survey for purposes of allocating lots to the members of the association, among whom were respondent Nabasa and petitioner Abejaron. When the 1971 survey was conducted, both the Abejarons and Nabasa were already occupying their respective 118 and 57 square meter portions of Lot 1, Block 5. Nabasa and Matilde Abejaron, representative of petitioner, were present during the survey.[17] Respondent Nabasa had a different story to tell. He contends that he had been residing on a 12 x 15 meter or 180-square meter public land in Silway, General Santos City since 1945. He admits that petitioner Abejaron was already residing in Silway when he arrived there. Nabasa constructed a house which stands to this day and planted five coconut trees on this 180-square meter land, but only two of the trees survived. Nabasa never harvested coconuts from these trees as petitioner Abejaron claims to own them and harvests the coconuts. In many parts of respondent Nabasas testimony, however, he declared that he started occupying the 180-square meter area in 1976.[18] Nabasa avers that previously, he and petitioner Abejaron were in possession of portions of Lot 2, Psu-154953. This lot was subsequently surveyed and divided into smaller lots with the area of petitioner Abejaron designated as Lot 2, Block 5, Psu154953 measuring one hundred eighty (180) square meters, while his was designated as Lot 1, Block 5, Psu-154953 with an area of one hundred seventy five (175) square meters. Instead of applying for free patent over his Lot 2, petitioner Abejaron gave this lot to his daughter Conchita Abejaron-Abellon and allowed her to file the application with the District Land Office XI-4, Bureau of Lands, Koronadal, South Cotabato. Conchita secured Free Patent No. (XI-4)-3293 over Lot 2. Pursuant to this, she was issued Original Certificate of Title No. P-4420. On April 27, 1981, Conchita's title was transcribed in the Registration Book of General Santos City. Respondent Nabasa, on the other hand, filed an application for Free Patent over Lot 1, Block 5, Psu-154953 with the District Land Office No. XI-4, Bureau of Lands, Koronadal, South Cotabato. While the application was pending, petitioner Abejaron forcibly encroached upon the northern and southwestern portion of Lot 1, Block 5, Psu159543. Abejaron fenced the disputed 118-square meter portion of Lot 1 and despite Nabasa's opposition, constructed a store near the road. Petitioner Abejaron then transferred his old house constructed on Lot 2, Block 5, Psu-154953 to a portion of the disputed 118-square meter area. Petitioner's daughter, Conchita, patentee and title holder of Lot 2, constructed her own house in Lot 2.

Free Patent No. (XI-4)-2877, covering Lot 1, Block 5, was issued to respondent Nabasa on September 24, 1974. But before the patent could be transcribed on the Registration Book of the Registrar of Deeds of General Santos City, the District Land Officer of District Land Office No. XI-4 recalled it for investigation of an administrative protest filed by the petitioner.[19] The protest was given due course, but petitioner Abejaron or his representative failed to appear in the hearings despite notice. On November 22, 1979, the administrative protest was dismissed by the District Land Officer for failure of petitioner Abejaron or his representative to appear in the hearings despite notice.[20] Respondent Nabasa's Free Patent No. (XI-4)-2877 was then re-transmitted by the District Land Officer of District Land Office XI-4 to the Register of Deeds, General Santos City, and the same was transcribed in the Registration Book of the Registry of Property of General Santos City on December 13, 1979. Original Certificate of Title No. P-4140, covering Lot 1, Block 2, Psu-154953, was issued to respondent Nabasa.[21] On March 12, 1982, petitioner Abejaron filed against respondent Nabasa an action for reconveyance with damages seeking reconveyance of his 118-square meter portion of Lot 1, Block 5, Psu-154953. During the trial, respondent Nabasa presented Abundio Guiral, his neighbor who had been living since 1945 in Lot 3, Block 5, Psu-154953, adjoining Nabasa's Lot 1. He testified that when he arrived in Silway, petitioner Abejaron was already living there. Four months after, Nabasa started residing in the area. Nabasa constructed a house, planted coconut trees, and fenced his 12 x 15 meter area. Abejaron's house in 1945 is still the same house he lives in at present, but in 1977, it was jacked up and transferred from Lot 2 to Lot 1, Block 5. Nabasa tried to prevent the transfer to no avail. The house was then extended towards Lot 2.[22] On rebuttal, petitioner Abejaron presented two neighbors. One of them, Alejandra Doria, started living in Silway in 1947. She testified that when she arrived in the neighborhood, Abejaron's fence as it now stands between the 57-square meter portion occupied by Nabasa's house and the 118-square meter area claimed by petitioner Abejaron was already there.[23] The other neighbor, Pacencia Artigo, also started living in Silway in 1947. She declared that the house of the Abejarons stands now where it stood in 1947. She also testified that the Abejarons previously had a store smaller than their present store.[24] On September 27, 1985, after trial on the merits, the trial court ruled in favor of petitioner Abejaron, viz: "WHEREFORE, IN VIEW OF ALL THE FOREGOING, this court hereby renders judgment as follows: 1. Declaring the possession and occupancy of Pacencio Abejaron over 118 square meters of Lot No. 1, Block 5, Psu-154953 in good faith and thereby declaring the inclusion of 118 square meters of said lot in OCT No. P-4140 erroneous and a mistake,

and for which, defendant Felix Nabasa is hereby ordered to reconvey and execute a registerable document in favor of plaintiff Pacencio Abejaron, Filipino, married and a resident of Silway, General Santos City, his heirs, successors and assigns over an area of one hundred eighteen (118) square meters of Lot No. 1, Block 5, Psu-154953, situated at Silway, General Santos City, on the Western portion of said lot as shown in the sketch plan, Exhibit "R", and the remaining portion of 57 square meters of said lot to be retained by defendant Felix Nabasa; 2) Should Felix Nabasa fails (sic) to do so, upon the finality of this judgment, the Clerk of Court shall executed (sic) it in the name of Felix Nabasa, widower, and will have the same effect as if executed by the latter and the Register of Deeds, General Santos City, is hereby directed to issue New Transfer Certificate of Title to Alejandro Abejaron over 118 square meters of Lot No. 1, Block 5, Psu-154953, and New Transfer Certificate of Title over 57 square meters of same Lot No. 1, Block 5, Psu-154953, in favor of Felix Nabasa, and ultimately to have OCT No. P-4140 of Felix Nabasa cancelled accordingly." Respondent Nabasa's motion for reconsideration having been denied, he appealed to the Court of Appeals. On April 26, 1988, the Court of Appeals rendered a decision in favor of respondent Nabasa, viz: ". . . the only basis for reconveyance is actual fraud. In this case, Abejaron failed to substantiate the existence of actual fraud. . . There was no proof of irregularity in the issuance of title nor in the proceedings incident thereto nor was there a claim that fraud intervened in the issuance of the title, thus, the title has become indefeasible (Frias v. Esquival, 67 SCRA 487). Abejaron was not able to establish his allegation that Nabasa misrepresented his status of possession in his application for the title. . . In fact, in Abejaron's answer to Nabasa's counterclaim, he said that Nabasa has been occupying the area since 1950. Contrary to the finding of the court a quo, the Bureau of Lands conducted an ocular inspection before the title was issued. This was confirmed by Abejaron himself (tsn, January 19, 1984). xxx WHEREFORE, premises considered, the decision appealed from is hereby REVERSED and SET ASIDE and a new one entered declaring Felix Nabasa as the owner of the lot covered by O.C.T. No. P-4140. Costs against plaintif-appellee. SO ORDERED."

certiorari with the following assignment of errors: "I. THE HONORABLE COURT OF APPEALS ERRED IN NOT FINDING THAT ACTUAL FRAUD WAS COMMITTED BY THE PRIVATE RESPONDENT AND PROVEN BY THE PETITIONER AND SUSTAINED BY THE TRIAL COURT WHEN PRIVATE RESPONDENT PROCURED THE TITLE IN HIS NAME OF THE AREA OF THE LOT IN QUESTION, LOT 1, BLOCK 5, LOCATED AT SILWAY, DADIANGAS, GENERAL SANTOS CITY. II. THE HONORABLE COURT OF APPEALS ERRED IN CONCLUDING THAT THE LOT WHICH BELONGS TO THE PETITIONER IS LOT 2 OF THE SAME BLOCK AND PSU, AND THAT THE PETITIONER FORCIBLY ENTERED INTO LOT 1 OF THE SAME BLOCK AND PSU, AND FORCIBLY TRANSFERRED HIS OLD HOUSE FROM LOT 2 TO LOT 1 IS BASED ONLY ON THE SELF-SERVING ALLEGATIONS OF THE PRIVATE RESPONDENT AND NOT SUPPORTED BY ANY COMPETENT AND CONVINCING EVIDENCE. III. THE HONORABLE COURT OF APPEALS ERRED IN DISREGARDING THE FACT THAT PETITIONER HAS A CLEAR RIGHT OVER THE PROPERTY IN QUESTION BECAUSE HE HAS BEEN IN ACTUAL AND LAWFUL POSSESSION FOR SO MANY YEARS AND A CLAIMANT OF THE PROPERTY IN QUESTION." We affirm the decision of the Court of Appeals. An action for reconveyance of a property is the sole remedy of a landowner whose property has been wrongfully or erroneously registered in another's name after one year from the date of the decree so long as the property has not passed to an innocent purchaser for value.[25] The action does not seek to reopen the registration proceeding and set aside the decree of registration but only purports to show that the person who secured the registration of the property in controversy is not the real owner thereof.[26] Fraud is a ground for reconveyance. For an action for reconveyance based on fraud to prosper, it is essential for the party seeking reconveyance to prove by clear and convincing evidence his title to the property and the fact of fraud.[27] Petitioner Abejaron does not claim to own Lot 1, Block 5, Psu-154953. He in fact admits that he believed the land in dispute was public in character, thus he did not declare it for taxation purposes despite possession of it for a long time. Neither did he apply for title over it on the mistaken belief that he could not apply for title of a public land. In his Complaint, he stated that respondent Nabasa's fraudulent procurement of Free Patent No. (XI-4)-2877 and OCT No. P-4140 over the disputed land deprived him not of ownership, but of his "right to file the necessary application thereon with the authorities concerned"[28] as long-time possessor of the land. Nonetheless, petitioner contends that an action for reconveyance is proper, viz:

Petitioner Abejaron filed a motion for reconsideration of the Court of Appeals decision. On July 22, 1988, the Court of Appeals rendered a resolution denying the motion for reconsideration for lack of merit. Hence, this petition for review on

". . . for an action of reconveyance of a parcel of land to prosper, it is not necessary that the proponent be the absolute owner thereof. It is enough that the proponent has an equitable right thereon. In the case at bar, the plaintiff had been in lawful, open,

continuous and notorious possession, occupation and control in the concept of an owner of a greater portion of the subject lot since 1945 and have (sic) thereby acquired an equitable right thereon protected by law. Possession of public lands once occupation of the same is proven, as the herein plaintiff did, under claim of ownership constitutes a grant from the state (Republic vs. Vera, 120 SCRA 210). A portion of the public land ceased to be public as soon as its claimant had performed all the conditions essential to a grant (Republic vs. Villanueva, 114 SCRA 875)."[29] Petitioner's contention, buttressed by the Vera case and Chief Justice Teehankee's dissent in the Villanueva case, is similar to the position taken by the plaintiff in Mesina v. Vda. de Sonza, et al.[30] In that case, plaintiff filed in the Court of First Instance of Nueva Ecija an action for cancellation of the original certificate of title procured by the defendant by virtue of a homestead patent. The title covered a public land which she claimed to own through public, open, and peaceful possession for more than thirty years. The law applicable in that case, which petitioner Abejaron apparently relies on in the case at bar, is Sec. 48(b) of Commonwealth Act 141 or the Public Land Act, as amended by Republic Act No. 1942, which took effect on June 22, 1957, viz: "Sec. 48. The following-described citizens of the Philippines, occupying lands of the public domain or claiming to own any such lands or an interest therein, but whose titles have not been perfected or completed, may apply to the Court of First Instance (now Regional Trial Courts) of the province where the land is located for confirmation of their claims and the issuance of a certificate of title therefor, under the Land Registration Act (now Property Registration Decree), to wit: xxx (b) Those who by themselves or through their predecessors in interest have been in open, continuous, exclusive, and notorious possession and occupation of agricultural lands of the public domain, under a bona fide claim of acquisition of ownership, for at least thirty years immediately preceding the filing of the application for confirmation of title except when prevented by war or force majeure. These shall be conclusively presumed to have performed all the conditions essential to a Government grant and shall be entitled to a certificate of title under the provisions of this Chapter." (emphasis supplied) Citing Susi v. Razon,[31] the Court interpreted this law, viz: ". . . where all the necessary requirements for a grant by the Government are complied with through actual physical possession openly, continuously, and publicly with a right to a certificate of title to said land under the provisions of Chapter VIII of Act No. 2874, amending Act No. 926 (carried over as Chapter VIII of Commonwealth Act No. 141), the possessor is deemed to have already acquired by operation of law not only a right to a grant, but a grant of the Government, for it is not necessary that a certificate of title be issued in order that said grant may be sanctioned by the courts -an application therefor

being sufficient under the provisions of Section 47 of Act No. 2874 (reproduced as Section 50, Commonwealth Act No. 141). If by a legal fiction, Valentin Susi had acquired the land in question by grant of the State, it had already ceased to be of the public domain and had become private property, at least by presumption, of Valentin Susi, beyond the control of the Director of Lands. (Italics supplied)" The Mesina and Susi cases were cited in Herico v. Dar,[32] another action for cancellation of title issued pursuant to a free patent. Again, the Court ruled that under Section 48(b) of the Public Land Act, as amended by Rep. Act No. 1942, with the plaintiff's proof of occupation and cultivation for more than 30 years since 1914, by himself and by his predecessor-in-interest, title over the land had vested in him as to segregate the land from the mass of public land. Thenceforth, the land was no longer disposable under the Public Land Act by free patent.[33] The Court held, viz: "As interpreted in several cases (Susi v. Razon, et al., 48 Phil. 424; Mesina v. Pineda Vda. de Sonza, G.R. No. L-14722, May 25, 1960) when the conditions as specified in the foregoing provision are complied with, the possessor is deemed to have acquired, by operation of law, a right to a grant, a government grant, without the necessity of a certificate of title being issued. The land, therefore, ceases to be of public domain, and beyond the authority of the Director of Lands to dispose of. The application for confirmation is a mere formality, the lack of which does not affect the legal sufficiency of the title as would be evidenced by the patent and the Torrens title to be issued upon the strength of said patent."[34] In citing Republic v. Villanueva, et al.,[35] petitioner Abejaron relied on the dissenting opinion of Chief Justice Teehankee. However, the en banc majority opinion in that case and in Manila Electric Company v. Bartolome,[36] departed from the doctrines enunciated in the Susi, Mesina, and Herico cases. Citing Uy Un v. Perez,[37] the Court ruled that "the right of an occupant of public agricultural land to obtain a confirmation of his title under Sec. 48(b) of Com. Act. No. 141, as amended by Rep. Act No. 1942, is 'derecho dominical incoativo' and that before the issuance of the certificate of title the occupant is not in the juridical sense the true owner of the land since it still pertains to the State."[38] The Court pointed out that the Villanueva and Meralco cases are different from the oft-cited Susi case as the latter involved a parcel of land possessed by a Filipino citizen since time immemorial, while the land in dispute in the Villanueva and Meralco cases were sought to be titled by virtue of Sec. 48(b) of the Public Land Act, as amended. In explaining the nature of land possessed since time immemorial, the Court quoted Oh Cho v. Director of Lands,[39] viz: "All lands that were not acquired from the Government, either by purchase or by grant, belong to the public domain. An exception to the rule would be any land that should have been in the possession of an occupant and of his predecessors-in-interest since time immemorial, for such possession would justify the presumption that the land had never been part of the public domain or that it had been a private property even before

the Spanish conquest." In 1986, however, in Director of Lands v. Intermediate Appellate Court, et al.,[40] this Court en banc recognized the strong dissent registered by Chief Justice Teehankee in the Villanueva case and abandoned the Villanueva and Meralco ruling to revert to the Susi doctrine. Reiterating the Susi and Herico cases, the Court ruled: "Nothing can more clearly demonstrate the logical inevitability of considering possession of public land which is of character and duration prescribed by statute as the equivalent of express grant from the State than the dictum of the statute itself [Sec. 48(b)] that the possessor(s) 'x x x shall be conclusively presumed to have performed all the conditions essential to a Government grant and shall be entitled to a certificate of title x x x.' No proof being admissible to overcome a conclusive presumption, confirmation proceedings would, in truth be little more than a formality, at the most limited to ascertaining whether the possession claimed is of the required character and length of time; and registration thereunder would not confer title, but simply recognize a title already vested. The proceedings would not originally convert the land from public to private land, but only confirm such a conversion already effected by operation of law from the moment the required period of possession became complete."[41] (Emphasis supplied) This is the prevailing rule as reiterated in the more recent case of Rural Bank of Compostela v. Court of Appeals, a ponencia of now Chief Justice Davide, Jr.,[42] viz: "The rule under the latter (Section 48[b] of the Public Land Act, as amended by R.A. No. 1942), is that when the conditions specified therein are complied with, the possessor is deemed to have acquired, by operation of law, a right to a government grant, without necessity of a certificate of title being issued, and the land ceases to be part of the public domain and beyond the authority of the Director of Lands."[43] The question brought to the fore, therefore, is whether or not petitioner Abejaron has satisfied the conditions specified in Sec. 48(b) of the Public Land Act, as amended by R.A. No. 1942. Sec. 48(b) has been further amended by P.D. No. 1073 which took effect on January 25, 1977. Sec. 4 of the P.D. reads as follows: "Sec. 4. The provision of Section 48(b) and Section 48(c), Chapter VIII, of the Public Land Act, are hereby amended in the sense that these provisions shall apply only to alienable and disposable lands of the public domain which have been in open, continuous, exclusive and notorious possession and occupation by the applicant himself or thru his predecessor-in-interest, under a bona fide claim of acquisition of ownership, since June 12, 1945. Sec. 48(b) of the Public Land Act, as further amended by P.D. No. 1073, now reads:

"(b) Those who by themselves or through their predecessors-in-interest have been in open, continuous, exclusive and notorious possession and occupation of agricultural lands of the public domain, under a bona fide claim of acquisition or ownership, since June 12, 1945, or earlier, immediately preceding the filing of the application for confirmation of title, except when prevented by wars or force majeure. Those shall be conclusively presumed to have performed all the conditions essential to a Government grant and shall be entitled to a certificate of title under the provisions of this chapter." (Italics ours)[44] However, as petitioner Abejaron's 30-year period of possession and occupation required by the Public Land Act, as amended by R.A. 1942 ran from 1945 to 1975, prior to the effectivity of P.D. No. 1073 in 1977, the requirement of said P.D. that occupation and possession should have started on June 12, 1945 or earlier, does not apply to him. As the Susi doctrine holds that the grant of title by virtue of Sec. 48(b) takes place by operation of law, then upon Abejaron's satisfaction of the requirements of this law, he would have already gained title over the disputed land in 1975. This follows the doctrine laid down in Director of Lands v. Intermediate Appellate Court, et al. ,[45] that the law cannot impair vested rights such as a land grant. More clearly stated, "Filipino citizens who by themselves or their predecessors-in-interest have been, prior to the effectivity of P.D. 1073 on January 25, 1977, in open, continuous, exclusive and notorious possession and occupation of agricultural lands of the public domain, under a bona fide claim of acquisition of ownership, for at least 30 years, or at least since January 24, 1947" may apply for judicial confirmation of their imperfect or incomplete title under Sec. 48(b) of the Public Land Act.[46] Having laid down the law applicable to the case at bar, i.e., Sec. 48(b) of the Public Land Act, as amended by R.A. 1942, we now determine whether or not petitioner has acquired title over the disputed land. In doing so, it is necessary for this Court to wade through the evidence on record to ascertain whether petitioner has been in open, continuous, exclusive and notorious possession and occupation of the 118-square meter disputed land for 30 years at least since January 24, 1947. It is axiomatic that findings of fact by the trial court and the Court of Appeals are final and conclusive on the parties and upon this Court, which will not be reviewed or disturbed on appeal unless these findings are not supported by evidence or unless strong and cogent reasons dictate otherwise.[47] One instance when findings of fact of the appellate court may be reviewed by this Court is when, as in the case at bar, the factual findings of the Court of Appeals and the trial court are contradictory.[48] Petitioner claims that he started occupying the disputed land in 1945. At that time, he built a nipa house, a small store, and a fence made of wood to delineate his area. This nipa house was improved in 1949 into a two-storey house. The small store was also made bigger in 1950. The wooden fence was also changed to a fence made of hollow blocks. The two-storey house, bigger store, and hollow-block fence all stand to this day. In 1951, petitioner planted coconut trees near his house. While the petitioner has shown continued existence of these improvements on the disputed land, they were introduced later than January 24, 1947. He has failed to establish the portion of the

disputed land that his original nipa house, small store and wooden fence actually occupied as of January 24, 1947. In the absence of this proof, we cannot determine the land he actually possessed and occupied for thirty years which he may acquire under Sec. 48(b) of the Public Land Act. Worthy of notice is the fact that the disputed land was surveyed, subdivided into and identified by lots only in the 1970's. Therefore, prior to the survey, it would be difficult to determine the metes and bounds of the land petitioner claims to have occupied since 1947 in the absence of specific and incontrovertible proof. The neighbors presented by the petitioner, namely Alejandra Doria, Pacencia Artigo, and Beatriz Gusila, could not also further his cause as both Doria and Artigo stated that they started residing in Silway in 1947, without specifying whether it was on or prior to January 24, 1947, while Gusila arrived in the neighborhood in 1949. While Doria testified that there was a fence between Abejaron's and Nabasa's houses in 1947, she did not state that Abejaron's 118-square meter area was enclosed by a fence which stands to this day. This is confirmed by Geodetic Engineer Lagsub's 1984 survey plan which shows that a fence stands only on one side of the 118-square meter area, the side adjacent to Nabasa's 57-square meter portion. Again, this poses the problem of determining the area actually occupied and possessed by Abejaron at least since January 24, 1947. Finally, as admitted by the petitioner, he has never declared the disputed land for taxation purposes. While tax receipts and tax declarations are not incontrovertible evidence of ownership, they become strong evidence of ownership acquired by prescription when accompanied by proof of actual possession of the property or supported by other effective proof.[49] Even the tax declarations and receipts covering his house do not bolster his case as the earliest of these was dated 1950. Petitioner's evidence does not constitute the "well-nigh incontrovertible" evidence necessary to acquire title through possession and occupation of the disputed land at least since January 24, 1947 as required by Sec. 48(b) of the Public Land Act, as amended by R.A. 1942. The basic presumption is that lands of whatever classification belong to the State and evidence of a land grant must be "well-nigh incontrovertible."[50] As petitioner Abejaron has not adduced any evidence of title to the land in controversy, whether by judicial confirmation of title, or homestead, sale, or free patent, he cannot maintain an action for reconveyance. In De La Pea v. Court of Appeals and Herodito Tan ,[51] the petitioner filed an action for reconveyance, claiming preferential right to acquire ownership over a 3/4 hectare of land and imputing fraud and misrepresentation to respondent in securing a free patent and original certificate of title over the land in controversy. The action for reconveyance was dismissed by the trial court and the Court of Appeals. This Court affirmed the decision of the Court of Appeals, viz: "It is well-settled that reconveyance is a remedy granted only to the owner of the property alleged to be erroneously titled in another's name. (Tomas v. Court of Appeals, G.R. No. 79328, 21 May 1990, 185 SCRA 627, 633; Esconde v. Barlongay, G.R. No. 67583,

31 July 1987, 152 SCRA 603, 611; Nebrada v. Heirs of Alivio, et al., 104 Phil. 126 [1958]; Director of Lands v. Register of Deeds of Rizal, 92 Phil. 826 [1953]; Azurin v. Quitoriano, et al., 81 Phil. 261 [1948]). In the case at bench, petitioner does not claim to be the owner of the disputed portion. Admittedly, what he has is only a "preferential right" to acquire ownership thereof by virtue of his actual possession since January 1947. . . Title to alienable public lands can be established through open, continuous, and exclusive possession for at least thirty (30) years. . . Not being the owner, petitioner cannot maintain the present suit. Persons who have not obtained title to public lands could not question the titles legally issued by the State. (Reyes v. Rodriguez, 62 Phil. 771, 776 [1936]) In such cases, the real party in interest is the Republic of the Philippines to whom the property would revert if it is ever established, after appropriate proceedings, that the free patent issued to the grantee is indeed vulnerable to annulment on the ground that the grantee failed to comply with the conditions imposed by the law. (See Sec. 101 of C.A. 141 [Public Land Act]; Lucas v. Durian, 102 Phil. 1157, 1158 [1957]; Sumail v. Judge of the Court of First Instance of Cotabato, et al., 96 Phil. 946, 953 [1955]). Not being an applicant, much less a grantee, petitioner cannot ask for reconveyance ." (emphasis supplied)[52] In the more recent case of Tankiko, et al. v. Cezar, et al.,[53] plaintiffs filed an action for reconveyance claiming that they were the actual occupants and residents of a 126,112-square meter land which was titled to another person. The trial court dismissed the action, but the Court of Appeals reversed the dismissal. Despite the appellate court's finding that plaintiffs had no personality to file the action for reconveyance, the disputed land being part of the public domain, it exercised equity jurisdiction to avoid leaving unresolved the matter of possession of the land in dispute. On appeal to this Court, we reinstated the decision of the trial court and dismissed the action for reconveyance, viz: ". . . equity is invoked only when the plaintiff, on the basis of the action filed and relief sought, has a clear right that he seeks to enforce, or that would obviously be violated if the action filed were to be dismissed for lack of standing. In the present case, respondents have no clear enforceable right, since their claim over the land in question is merely inchoate and uncertain. Admitting that they are only applicants for sales patents on the land, they are not and they do not even claim to be owners thereof. Second, it is evident that respondents are not the real parties in interest. Because they admit that they are not the owners of the land but mere applicants for sales patents thereon, it is daylight clear that the land is public in character and that it should revert to the State. This being the case, Section 101 of the Public Land Act categorically declares that only the government may institute an action for reconveyance of ownership of a public land. . . xxx

In the present dispute, only the State can file a suit for reconveyance of a public land. Therefore, not being the owners of the land but mere applicants for sales patents thereon, respondents have no personality to file the suit. Neither will they be directly affected by the judgment in such suit. xxx Clearly, a suit filed by a person who is not a party in interest must be dismissed. Thus, in Lucas v. Durian, 102 Phil. 1157, September 23, 1957, the Court affirmed the dismissal of a Complaint filed by a party who alleged that the patent was obtained by fraudulent means and consequently, prayed for the annulment of said patent and the cancellation of a certificate of title. The Court declared that the proper party to bring the action was the government, to which the property would revert."[54] Similarly, as petitioner Abejaron has failed to show his title to the disputed land, he is not the proper party to file an action for reconveyance that would result in the reversion of the land to the government. It is the Solicitor General, on behalf of the government, who is by law mandated to institute an action for reversion.[55] He has the specific power and function to "represent the Government in all land registration and related proceedings" and to "institute actions for the reversion to the Government of lands of the public domain and improvements thereon as well as lands held in violation of the Constitution."[56] Since respondent Nabasa's Free Patent and Original Certificate of Title originated from a grant by the government, their cancellation is a matter between the grantor and the grantee.[57] Having resolved that petitioner Abejaron does not have legal standing to sue and is not the real party in interest, we deem it unnecessary to resolve the question of fraud and the other issues raised in the petition. These shall be timely for adjudication if a proper suit is filed by the Solicitor General in the future. WHEREFORE, the petition is DENIED and the impugned decision of the Court of Appeals is AFFIRMED. The Complaint filed in Civil Case No. 2492 before the Regional Trial Court of South Cotabato, Branch 1, is DISMISSED. No costs. SO ORDERED. Davide, Jr., C.J. (Chairman), Kapunan, Pardo, and Ynares-Santiago, JJ., concur.

Republic of the PhilippinesSUPREME COURTManila THIRD DIVISION G.R. No. 76217 September 14, 1989 GERMAN MANAGEMENT & SERVICES, INC., petitioner, vs.HON. COURT OF APPEALS and ERNESTO VILLEZA, respondents. G.R. No. L-76216 September 14, 1989 GERMAN MANAGEMENT & SERVICES, INC., petitioner, vs.HON. COURT OF APPEALS and ORLANDO GERNALE, respondents. Alam, Verano & Associates for petitioner. Francisco D. Lozano for private respondents.

Farmer's Association; that they have occupied and tilled their farmholdings some twelve to fifteen years prior to the promulgation of P.D. No. 27; that during the first week of August 1983, petitioner, under a permit from the Office of the Provincial Governor of Rizal, was allowed to improve the Barangay Road at Sitio Inarawan, San Isidro, Antipolo, Rizal at its expense, subject to the condition that it shag secure the needed right of way from the owners of the lot to be affected; that on August 15, 1983 and thereafter, petitioner deprived private respondents of their property without due process of law by: (1) forcibly removing and destroying the barbed wire fence enclosing their farmholdings without notice; (2) bulldozing the rice, corn fruit bearing trees and other crops of private respondents by means of force, violence and intimidation, in violation of P.D. 1038 and (3) trespassing, coercing and threatening to harass, remove and eject private respondents from their respective farmholdings in violation of P.D. Nos. 316, 583, 815, 1 and 1028. On January 7,1985, the Municipal Trial Court dismissed private respondents' complaint 2 for forcible entry. On appeal, the Regional Trial Court of Antipolo, Rizal, Branch LXXI 3 sustained the dismissal by the Municipal Trial Court. Private respondents then filed a petition for review with the Court of Appeals. On July 24,1986, said court gave due course to their petition and reversed the decisions of the 4 Municipal Trial Court and the Regional Trial Court.

FERNAN, C.J.: Spouses Cynthia Cuyegkeng Jose and Manuel Rene Jose, residents of Pennsylvania, Philadelphia, USA are the owners of a parcel of land situated in Sitio Inarawan, San Isidro, Antipolo, Rizal, with an area of 232,942 square meters and covered by TCT No. 50023 of the Register of Deeds of the province of Rizal issued on September 11, 1980 which canceled TCT No. 56762/ T-560. The land was originally registered on August 5, 1948 in the Office of the Register of Deeds of Rizal as OCT No. 19, pursuant to a Homestead Patent granted by the President of the Philippines on July 27, 1948, under Act No. 141. On February 26, 1982, the spouses Jose executed a special power of attorney authorizing petitioner German Management Services to develop their property covered by TCT No. 50023 into a residential subdivision. Consequently, petitioner on February 9,1983 obtained Development Permit No. 00424 from the Human Settlements Regulatory Commission for said development. Finding that part of the property was occupied by private respondents and twenty other persons, petitioner advised the occupants to vacate the premises but the latter refused. Nevertheless, petitioner proceeded with the development of the subject property which included the portions occupied and cultivated by private respondents. Private respondents filed an action for forcible entry against petitioner before the Municipal Trial Court of Antipolo, Rizal, alleging that they are mountainside farmers of Sitio Inarawan, San Isidro, Antipolo, Rizal and members of the Concerned Citizens of The Appellate Court held that since private respondents were in actual possession of the property at the time they were forcibly ejected by petitioner, private respondents have a right to commence an action for forcible entry regardless of the legality or illegality of 5 possession. Petitioner moved to reconsider but the same was denied by the Appellate 6 Court in its resolution dated September 26, 1986. Hence, this recourse. The issue in this case is whether or not the Court of Appeals denied due process to petitioner when it reversed the decision of the court a quo without giving petitioner the opportunity to file its answer and whether or not private respondents are entitled to file 7 a forcible entry case against petitioner. We affirm. The Court of Appeals need not require petitioner to file an answer for due process to exist. The comment filed by petitioner on February 26, 1986 has sufficiently addressed the issues presented in the petition for review filed by private respondents before the Court of Appeals. Having heard both parties, the Appellate Court need not await or require any other additional pleading. Moreover, the fact that petitioner was heard by the Court of Appeals on its motion for reconsideration negates any violation of due process. Notwithstanding petitioner's claim that it was duly authorized by the owners to develop the subject property, private respondents, as actual possessors, can commence a

forcible entry case against petitioner because ownership is not in issue. Forcible entry is merely a quieting process and never determines the actual title to an estate. Title is not 8 involved. In the case at bar, it is undisputed that at the time petitioner entered the property, private respondents were already in possession thereof . There is no evidence that the spouses Jose were ever in possession of the subject property. On the contrary, private respondents' peaceable possession was manifested by the fact that they even planted rice, corn and fruit bearing trees twelve to fifteen years prior to petitioner's act of destroying their crops. Although admittedly petitioner may validly claim ownership based on the muniments of title it presented, such evidence does not responsively address the issue of prior actual possession raised in a forcible entry case. It must be stated that regardless of the actual condition of the title to the property, the party in peaceable quiet possession shall not 9 be turned out by a strong hand, violence or terror. Thus, a party who can prove prior possession can recover such possession even against the owner himself. Whatever may be the character of his prior possession, if he has in his favor priority in time, he has the security that entitles him to remain on the property until he is lawfully ejected by a 10 person having a better right by accion publiciana or accion reivindicatoria. Both the Municipal Trial Court and the Regional Trial Court have rationalized petitioner's drastic action of bulldozing and destroying the crops of private respondents on the basis 11 of the doctrine of self-help enunciated in Article 429 of the New Civil Code. Such justification is unavailing because the doctrine of self-help can only be exercised at the time of actual or threatened dispossession which is absent in the case at bar. When possession has already been lost, the owner must resort to judicial process for the recovery of property. This is clear from Article 536 of the Civil Code which states, "(I)n no case may possession be acquired through force or intimidation as long as there is a possessor who objects thereto. He who believes that he has an action or right to deprive another of the holding of a thing, must invoke the aid of the competent court, if the holder should refuse to deliver the thing." WHEREFORE, the Court resolved to DENY the instant petition. The decision of the Court of Appeals dated July 24,1986 is hereby AFFIRMED. Costs against petitioner. SO ORDERED. Bidin and Cortes, JJ., concur. Gutierrez, Jr., J., concurs in the result. Feliciano, J., is on leave.

Republic of the PhilippinesSUPREME COURTManila EN BANC

Supreme Court, but the appeal was dismissed in a resolution dated April 10, 1958. On May 17, 1958, Roxas y Cia. filed an action against Marcelino Guevarra in the justice of the peace court of Nasugbu, Batangas, for forcible entry, praying therein that Guevarra be ejected from the premises of Lot No. 105-A. After due hearing, the said Court in a decision dated May 2, 1959 ordered Guevarra to vacate the lot and to pay damages and accrued rentals. A writ of execution was issued by Justice of the Peace Rodolfo A. Castillo of Nasugbu, which was served on Guevarra on June 6, 1959, and the return of which was made by Deputy Sheriff Leonardo R. Aquino of this Court on June 23, 1959 (Exhibit "10"). The writ recites among other things that the possession of the land was delivered to the Roxas y Cia. thru Felix Caisip, the overseer, and Guevarra was given twenty days from June 6, 1959 within which to leave the premises. The record before Us does not explain why said decision was executed. According to the complainant, her husband's counsel had appealed from said decision. The justice of the peace who rendered it, Hon. Rodolfo Castillo, said that there really had been an attempt to appeal, which was not given due course because the reglementary period therefor had expired; that a motion to reconsider his order to this effect was denied by him; and that a second motion for reconsideration was " still pending consideration," and it was October 19, 1959 when such testimony was given. Continuing the narration of the antecedent facts, His Honor, the Trial Judge, added: On June 15, 1959, some trouble occurred between the complainant and Caisip regarding the cutting of sugar cane on Lot 105-A. The following day June 16, 1959, the complainant allegedly again entered the premises of Lot 105-A and refused to be driven out by Felix Caisip. Due to the aforementioned incidents, Gloria Cabalag was charged in the justice of the peace court of Nasugbu, Batangas, with grave coercion for the incident of June 15, 1959, docketed in the said court as Criminal Case No. 968 (Exhibit "3"); and with the crime of unjust vexation for the incident of June 16, 1959, docketed in the said court as Criminal Case No. 970. Both cases, however, were filed only on June 25, 1959. In other words, these criminal cases, Nos. 968 and 970, against Gloria Cabalag, were filed eight (8) days after the incident involved in the case at bar. It is, also, noteworthy that both cases were on motion of the prosecution, filed after a reinvestigation thereof provisionally dismissed, on November 8, 1960, by the Court of First Instance of Batangas, upon the ground "that the evidence of record ... are insufficient to prove the guilt of the accused beyond reasonable doubt." The decision of said court, in the case at bar, goes on to say: It further appears that due to the tenacious attitude of Gloria Cabalag to remain in the premises, Caisip sought the help of the chief of police of Nasugbu who advised him to see Deputy Sheriff Aquino about the matter. The latter, however, informed Caisip that he could not act on the request to eject Gloria Cabalag and to stop her from what she was doing without a proper court order. Caisip then consulted Antonio Chuidian, the

G.R. No. L-28716 November 18, 1970 FELIX CAISIP, IGNACIO ROJALES and FEDERICO VILLADELREY, petitioners, vs.THE PEOPLE OF THE PHILIPPINES and THE COURT OF APPEALS, respondents. Godofredo F. Trajano and Rafael A. Francisco for petitioners. Office of the Solicitor General Felix V. Makasiar, Assistant Solicitor General Antonio G. Ibarra and Solicitor Conrado T. Limcaoco for respondents.

CONCEPCION, C.J.: This case is before Us upon petition of defendants Felix Caisip, Ignacio Rojales and Federico Villadelrey, for review on certiorari of a decision of the Court of Appeals which affirmed that of the Court of First Instance of Batangas, convicting them of the crime of Grave Coercion, with which they are charged, and sentencing each to four (4) months and one (1) day of arresto mayor and to pay a fine of P200.00, with subsidiary imprisonment in case of insolvency, not to exceed one-third of the principal penalty, as well as one-third of the costs. As set forth in the trial court's decision, the background of the present case is this: The complainant Gloria Cabalag is the wife of Marcelino Guevarra who cultivated a parcel of land known as Lot 105-A of Hacienda Palico situated in sitio Bote-bote, barrio Tampisao, Nasugbu, Batangas. The said parcel of land used to be tenanted by the deceased father of the complainant. Hacienda Palico is owned by Roxas y Cia. and administered by Antonio Chuidian. The overseer of the said hacienda is Felix Caisip, one of the accused herein. Even before the occurrence of the incident presently involved, there had been a series of misunderstandings and litigations involving the complainant and her husband, on one hand, and the men of Hacienda Palico on the other. It appears that on December 23, 1957, Marcelino Guevarra filed an action with the Court of Agrarian Relations seeking recognition as a lawful tenant of Roxas y Cia. over lot No. 105-A of Hacienda Palico. In a decision dated February 22, 1958, the Court of Agrarian Relations declared it has no jurisdiction over the case, inasmuch as Guevarra is not a tenant on the said parcel of land. An appeal was taken by Guevarra to the

hacienda administrator, who, in turn, went to the chief of police and requested for the detail of policemen in sitio Bote-bote. The chief of police, acting on said request, assigned the accused Ignacio Rojales and Federico Villadelrey, police sergeant and police 1 corporal, respectively, of the Nasugbu Police Force, to sitio Bote-bote. On June 17, 1959, at about 5:00 p.m., Gloria Cabalag was seen weeding the portion of Lot 105-A which was a ricefield. Appellant Caisip approached her and bade her to leave, but she refused to do so, alleging that she and her husband had the right to stay there and that the crops thereon belong to them. She having stuck to this attitude, even when he threatened to call the police, Caisip went to his co-defendants, Sgt. Rojales and Cpl. Villadelrey, both of the local police, who were some distance away, and brought them with him. Rojales told Gloria, who was then in a squatting position, to stop weeding. As Gloria insisted on her right to stay in said lot, Rojales grabbed her right hand and, twisting the same, wrested therefrom the trowel she was holding. Thereupon, Villadelrey held her left hand and, together with Rojales, forcibly dragged her northward towards a forested area, where there was a banana plantation as Caisip stood nearby, with a drawn gun. Inasmuch as Gloria shouted "Ina ko po! Ina ko po!" her neighbors, Librada Dulutan, followed, soon later, by Francisca Andino, came and asked the policemen why they were dragging her. The policemen having answered that they would take Gloria to town which was on the west Francisca Andino pleaded that Gloria be released, saying that, if their purpose was as stated by them, she (Gloria) would willingly go with them. By this time, Gloria had already been dragged about eight meters and her dress, as well as her 3 blouse were torn. She then agreed to proceed westward to the municipal building, and asked to be allowed to pass by her house, within Lot 105-A, in order to breast-feed her nursing infant, but, the request was turned down. As they passed, soon later, near the house of Zoilo Rivera, head of the tenant organization to which she was affiliated, in the barrio of Camachilihan, Gloria called out for him, whereupon, he went down the house and accompanied them to the municipal building. Upon arrival thereat, Rojales and Villadelrey turned her over to the policeman on duty, and then departed. After being interrogated by the chief of police, Gloria was, upon representations made by Zoilo Rivera, released and allowed to go home. The foregoing is the prosecution's version. That of the defense is to the effect that, upon being asked by the policemen to stop weeding and leave the premises, Gloria, not only refused to do so, but, also, insulted them, as well as Caisip. According to the defense, she was arrested because of the crime of slander then committed by her. Appellants Rojales and Villadelrey, moreover, testified that, as they were heading towards the barrio of Camachilihan, Gloria proceeded to tear her clothes. His Honor, the Trial Judge, accepted, however, the version of the prosecution and found that of the defense unworthy of credence. The findings of fact of the Court of Appeals, which fully concurred in this view, are "final," and our authority to review on certiorari 4 its appealed decision is limited to questions purely of law. Appellants maintain that the
2

Court of Appeals has erred: (1) in not finding their acts "justified under Article 429 of the New Civil Code"; (2) in holding that the 20-day period of grace given to Marcelino Guevarra and his wife, Gloria Cabalag, by the sheriff, to vacate Lot 105-A, was valid and lawful; (3) in finding that the elements of the crime of grave coercion are present in the case at bar; and (4) in finding appellants guilty as charged. This pretense is clearly untenable. Art. 429 of our Civil Code, reading: The owner or lawful possessor of a thing has the right to exclude any person from the enjoyment and disposal thereof. For this purpose, he may use such force as may be reasonably necessary to repel or prevent an actual or threatened unlawful physical invasion or usurpation of his property. upon which appellants rely is obviously inapplicable to the case at bar, for, having been given 20 days from June 6, 1959, within which to vacate Lot 105-A, complainant did not, on June 17, 1959 or within said period invade or usurp said lot. She had merely remained in possession thereof, even though the hacienda owner may have become its co-possessor. Appellants did not "repel or prevent in actual or threatened ... physical invasion or usurpation." They expelled Gloria from a property of which she and her husband were in possession even before the action for forcible entry was filed against them on May 17, 1958, despite the fact that the Sheriff had explicitly authorized them to stay in said property up to June 26, 1959, and had expressed the view that he could not oust them therefrom on June 17, 1959, without a judicial order therefor. It is urged, that, by weeding and refusing to leave Lot 105-A, Gloria had committed a crime in the presence of the policemen, despite the aforementioned 20-day period, which, appellants claim, the sheriff had no authority to grant. This contention is manifestly untenable, because: (1) said period was granted in the presence of the hacienda owner's representative, appellant Caisip, who, by not objecting thereto, had impliedly consented to or ratified the act performed by the sheriff; (2) Gloria and her husband were thereby allowed to remain, and had, in fact, remained, in possession of the premises, perhaps together with the owner of the hacienda or his representative, Caisip; (3) the act of removing weeds from the ricefield was beneficial to its owner and to whomsoever the crops belonged, and, even if they had not authorized it, does not constitute a criminal offense; and (4) although Gloria and her husband had been sentenced to vacate the land, the judgment against them did not necessarily imply that they, as the parties who had tilled it and planted thereon, had no rights, of any kind whatsoever, in or to the standing crops, inasmuch as "necessary expenses shall be 5 refunded to every possessor," and the cost of cultivation, production and upkeep has 6 been held to partake of the nature of necessary expenses. It is, accordingly, clear that appellants herein had, by means of violence, and without legal authority therefor, prevented the complainant from "doing something not prohibited by law," (weeding and being in Lot 105-A), and compelled her "to do

something against" her will (stopping the weeding and leaving said lot), " whether it be right or wrong," thereby taking the law into their hands, in violation of Art. 286 of the 7 Revised Penal Code. Appellant Caisip argues that, not having used violence against the complaining witness, he should be acquitted of the charge. In this connection, His Honor, the Trial Judge, correctly observed: ... While it is true that the accused Caisip did not lay hands on the complainant, unlike the accused Rojales and Villadelrey who were the ones who used force against Gloria, and while the Court is also inclined to discredit the claim of the complainant that Felix Caisip drew a gun during the incident, it sufficiently appears from the record that the motivation and inducement for the coercion perpetrated on the complainant came from the accused Caisip. It was his undisguised and particular purpose to prevent Gloria from entering the land and working on the same. He was the one who first approached Gloria with this objective in mind, and tried to prevent her from weeding the land. He had tried to stop Gloria from doing the same act even the day previous to the present incident. It was Caisip who fetched the policemen in order to accomplish his purpose of preventing Gloria from weeding the land and making her leave the premises. The policemen obeyed his bidding, and even when the said policemen were already over-asserting their authority as peace officers, Caisip simply stood by without attempting to stop their abuses. He could be hardly said to have disapproved an act which he himself induced 8 and initiated. In other words, there was community of purpose between the policemen and Caisip, so that the latter is guilty of grave coercion, as a co-conspirator, apart from being a 9 principal by induction. In the commission of the offense, the aggravating circumstances of abuse of superior 10 11 strength and disregard of the respect due the offended party, by reason of her sex, were present, insofar as the three appellants herein are concerned. As regards appellants Rojales and Villadelrey, there was the additional aggravating circumstance of having taken advantage of their positions as members of the local police force. Hence, the penalty of imprisonment meted out to appellants herein, which is the minimum of 12 the maximum prescribed in said Art. 286, and the fine imposed upon them, are in accordance with law. WHEREFORE, the decision appealed from is hereby affirmed, with costs against the defendants-appellants. It is so ordered. Reyes, J.B.L., Makalintal, Zaldivar, Castro, Fernando, Teehankee and Barredo, JJ., concur. Dizon, J., is on leave.

Makasiar and Villamor, JJ., took no part.

Republic of the PhilippinesSUPREME COURTManila THIRD DIVISION G.R. No. 74761 November 6, 1990 NATIVIDAD V. ANDAMO and EMMANUEL R. ANDAMO, petitioners, vs.INTERMEDIATE APPELLATE COURT (First Civil Cases Division) and MISSIONARIES OF OUR LADY OF LA SALETTE, INC., respondents. Lope E. Adriano for petitioners. Padilla Law Office for private respondent.

corporation, this time a civil case, docketed as Civil Case No. TG-748, for damages with 1 prayer for the issuance of a writ of preliminary injunction before the same court. On March 11, 1983, respondent corporation filed its answer to the complaint and opposition to the issuance of a writ of preliminary injunction. Hearings were conducted including ocular inspections on the land. However, on April 26, 1984, the trial court, acting on respondent corporation's motion to dismiss or suspend the civil action, issued an order suspending further hearings in Civil Case No, TG-748 until after judgment in the related Criminal Case No. TG-907-82. Resolving respondent corporation's motion to dismiss filed on June 22, 1984, the trial court issued on August 27, 1984 the disputed order dismissing Civil Case No. TG-748 for lack of jurisdiction, as the criminal case which was instituted ahead of the civil case was still unresolved. Said order was anchored on the provision of Section 3 (a), Rule III of the Rules of Court which provides that "criminal and civil actions arising from the same offense may be instituted separately, but after the criminal action has been commenced the civil action cannot be instituted until final judgment has been rendered in the 2 criminal action." Petitioners appealed from that order to the Intermediate Appellate Court.
3

FERNAN, C.J.: The pivotal issue in this petition for certiorari, prohibition and mandamus is whether a corporation, which has built through its agents, waterpaths, water conductors and contrivances within its land, thereby causing inundation and damage to an adjacent land, can be held civilly liable for damages under Articles 2176 and 2177 of the Civil Code on quasi-delicts such that the resulting civil case can proceed independently of the criminal case. The antecedent facts are as follows: Petitioner spouses Emmanuel and Natividad Andamo are the owners of a parcel of land situated in Biga (Biluso) Silang, Cavite which is adjacent to that of private respondent, Missionaries of Our Lady of La Salette, Inc., a religious corporation. Within the land of respondent corporation, waterpaths and contrivances, including an artificial lake, were constructed, which allegedly inundated and eroded petitioners' land, caused a young man to drown, damaged petitioners' crops and plants, washed away costly fences, endangered the lives of petitioners and their laborers during rainy and stormy seasons, and exposed plants and other improvements to destruction. In July 1982, petitioners instituted a criminal action, docketed as Criminal Case No. TG907-82, before the Regional Trial Court of Cavite, Branch 4 (Tagaytay City), against Efren Musngi, Orlando Sapuay and Rutillo Mallillin, officers and directors of herein respondent corporation, for destruction by means of inundation under Article 324 of the Revised Penal Code. Subsequently, on February 22, 1983, petitioners filed another action against respondent

On February 17, 1986, respondent Appellate Court, First Civil Cases Division, 4 5 promulgated a decision affirming the questioned order of the trial court. A motion for reconsideration filed by petitioners was denied by the Appellate Court in its resolution 6 dated May 19, 1986. Directly at issue is the propriety of the dismissal of Civil Case No. TG-748 in accordance with Section 3 (a) of Rule 111 of the Rules of Court. Petitioners contend that the trial court and the Appellate Court erred in dismissing Civil Case No. TG-748 since it is predicated on a quasi-delict. Petitioners have raised a valid point. It is axiomatic that the nature of an action filed in court is determined by the facts 7 alleged in the complaint as constituting the cause of action. The purpose of an action or suit and the law to govern it, including the period of prescription, is to be determined not by the claim of the party filing the action, made in his argument or brief, but rather 8 by the complaint itself, its allegations and prayer for relief. The nature of an action is not necessarily determined or controlled by its title or heading but the body of the pleading or complaint itself. To avoid possible denial of substantial justice due to legal technicalities, pleadings as well as remedial laws should be liberally construed so that 9 the litigants may have ample opportunity to prove their respective claims. Quoted hereunder are the pertinent portions of petitioners' complaint in Civil Case No. TG-748:

4) That within defendant's land, likewise located at Biga (Biluso), Silang, Cavite, adjacent on the right side of the aforesaid land of plaintiffs, defendant constructed waterpaths starting from the middle-right portion thereof leading to a big hole or opening, also constructed by defendant, thru the lower portion of its concrete hollow-blocks fence situated on the right side of its cemented gate fronting the provincial highway, and connected by defendant to a man height inter-connected cement culverts which were also constructed and lain by defendant cross-wise beneath the tip of the said cemented gate, the left-end of the said inter-connected culverts again connected by defendant to a big hole or opening thru the lower portion of the same concrete hollowblocks fence on the left side of the said cemented gate, which hole or opening is likewise connected by defendant to the cemented mouth of a big canal, also constructed by defendant, which runs northward towards a big hole or opening which was also built by defendant thru the lower portion of its concrete hollow-blocks fence which separates the land of plaintiffs from that of defendant (and which serves as the exit-point of the floodwater coming from the land of defendant, and at the same time, the entrance-point of the same floodwater to the land of plaintiffs, year after year, during rainy or stormy seasons. 5) That moreover, on the middle-left portion of its land just beside the land of plaintiffs, defendant also constructed an artificial lake, the base of which is soil, which utilizes the water being channeled thereto from its water system thru inter-connected galvanized iron pipes (No. 2) and complimented by rain water during rainy or stormy seasons, so much so that the water below it seeps into, and the excess water above it inundates, portions of the adjoining land of plaintiffs. 6) That as a result of the inundation brought about by defendant's aforementioned water conductors, contrivances and manipulators, a young man was drowned to death, while herein plaintiffs suffered and will continue to suffer, as follows: a) Portions of the land of plaintiffs were eroded and converted to deep, wide and long canals, such that the same can no longer be planted to any crop or plant. b) Costly fences constructed by plaintiffs were, on several occasions, washed away. c) During rainy and stormy seasons the lives of plaintiffs and their laborers are always in danger. d) Plants and other improvements on other portions of the land of plaintiffs are exposed 10 to destruction. ... A careful examination of the aforequoted complaint shows that the civil action is one under Articles 2176 and 2177 of the Civil Code on quasi-delicts. All the elements of a quasi-delict are present, to wit: (a) damages suffered by the plaintiff, (b) fault or negligence of the defendant, or some other person for whose acts he must respond; and (c) the connection of cause and effect between the fault or negligence of the

defendant and the damages incurred by the plaintiff.

11

Clearly, from petitioner's complaint, the waterpaths and contrivances built by respondent corporation are alleged to have inundated the land of petitioners. There is therefore, an assertion of a causal connection between the act of building these waterpaths and the damage sustained by petitioners. Such action if proven constitutes fault or negligence which may be the basis for the recovery of damages. In the case of Samson vs. Dionisio, the Court applied Article 1902, now Article 2176 of the Civil Code and held that "any person who without due authority constructs a bank or dike, stopping the flow or communication between a creek or a lake and a river, thereby causing loss and damages to a third party who, like the rest of the residents, is entitled to the use and enjoyment of the stream or lake, shall be liable to the payment of an indemnity for loss and damages to the injured party. While the property involved in the cited case belonged to the public domain and the property subject of the instant case is privately owned, the fact remains that petitioners' complaint sufficiently alleges that petitioners have sustained and will continue to sustain damage due to the waterpaths and contrivances built by respondent corporation. Indeed, the recitals of the complaint, the alleged presence of damage to the petitioners, the act or omission of respondent corporation supposedly constituting fault or negligence, and the causal connection between the act and the damage, with no pre-existing contractual obligation between the parties make a clear case of a quasi delict or culpa aquiliana. It must be stressed that the use of one's property is not without limitations. Article 431 of the Civil Code provides that "the owner of a thing cannot make use thereof in such a manner as to injure the rights of a third person." SIC UTERE TUO UT ALIENUM NON LAEDAS. Moreover, adjoining landowners have mutual and reciprocal duties which require that each must use his own land in a reasonable manner so as not to infringe upon the rights and interests of others. Although we recognize the right of an owner to build structures on his land, such structures must be so constructed and maintained using all reasonable care so that they cannot be dangerous to adjoining landowners and can withstand the usual and expected forces of nature. If the structures cause injury or damage to an adjoining landowner or a third person, the latter can claim indemnification for the injury or damage suffered. Article 2176 of the Civil Code imposes a civil liability on a person for damage caused by his act or omission constituting fault or negligence, thus: Article 2176. Whoever by act or omission causes damage to another, there being fault or negligence, is obliged to pay for the damage done. Such fault or negligence, if there is no pre-existing contractual relation between the parties, is called a quasi-delict and is governed by the provisions of this chapter.
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Article 2176, whenever it refers to "fault or negligence", covers not only acts "not punishable by law" but also acts criminal in character, whether intentional and voluntary or negligent. Consequently, a separate civil action lies against the offender in a criminal act, whether or not he is criminally prosecuted and found guilty or acquitted, provided that the offended party is not allowed, (if the tortfeasor is actually charged also criminally), to recover damages on both scores, and would be entitled in such eventuality only to the bigger award of the two, assuming the awards made in the two 13 cases vary. The distinctness of quasi-delicta is shown in Article 2177 of the Civil Code, which states:

WHEREFORE, the assailed decision dated February 17, 1986 of the then Intermediate Appellate Court affirming the order of dismissal of the Regional Trial Court of Cavite, Branch 18 (Tagaytay City) dated August 17, 1984 is hereby REVERSED and SET ASIDE. The trial court is ordered to reinstate Civil Case No. TG-748 entitled "Natividad V. Andamo and Emmanuel R. Andamo vs. Missionaries of Our Lady of La Salette Inc." and to proceed with the hearing of the case with dispatch. This decision is immediately executory. Costs against respondent corporation. SO ORDERED. Gutierrez, Jr. and Bidin, JJ., concur.

Article 2177. Responsibility for fault or negligence under the preceding article is entirely separate and distinct from the civil liability arising from negligence under the Penal Code. But the plaintiff cannot recover damages twice for the same act or omission of the defendant. According to the Report of the Code Commission "the foregoing provision though at first sight startling, is not so novel or extraordinary when we consider the exact nature of criminal and civil negligence. The former is a violation of the criminal law, while the latter is a distinct and independent negligence, which is a "culpa aquiliana" or quasidelict, of ancient origin, having always had its own foundation and individuality, separate from criminal negligence. Such distinction between criminal negligence and "culpa extra-contractual" or "cuasi-delito" has been sustained by decisions of the 14 Supreme Court of Spain ... In the case of Castillo vs. Court of Appeals, this Court held that a quasi-delict or culpa aquiliana is a separate legal institution under the Civil Code with a substantivity all its own, and individuality that is entirely apart and independent from a delict or crime a distinction exists between the civil liability arising from a crime and the responsibility for quasi-delicts or culpa extra-contractual. The same negligence causing damages may produce civil liability arising from a crime under the Penal Code, or create an action for quasi-delicts or culpa extra-contractual under the Civil Code. Therefore, the acquittal or conviction in the criminal case is entirely irrelevant in the civil case, unless, of course, in the event of an acquittal where the court has declared that the fact from which the civil action arose did not exist, in which case the extinction of the criminal liability would carry with it the extinction of the civil liability. In Azucena vs. Potenciano, the Court declared that in quasi-delicts, "(t)he civil action is entirely independent of the criminal case according to Articles 33 and 2177 of the Civil Code. There can be no logical conclusion than this, for to subordinate the civil action contemplated in the said articles to the result of the criminal prosecution whether it be conviction or acquittal would render meaningless the independent character of the civil action and the clear injunction in Article 31, that his action may proceed independently of the criminal proceedings and regardless of the result of the latter."
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Feliciano, J., is on leave.