11. TEN FORTY REALTY and DEVT CORP v.
CRUZ was no delivery of the object of the sale as provided for in Article 1428 of the Civil Code; and 3)
G.R. No. 151212 | September 10, 2003; Panganiban, J.
DOCTRINE: (This case mainly sought to determine what proper action should have been done by petitioner
Ten Forty -- Forcible Entry or Unlawful Detainer) Focus on difference of Forcible entry and Unlawful
Detainer.
Unlawful Detainer; To justify an action for unlawful detainer, the permission or tolerance must have been
present at the beginning of the possession.
To maintain a viable action for forcible entry, plaintiff must have been in prior physical possession of the
property.
Forcible Entry; Both causes of action deal only with the sole issue of physical or de facto possession though
they are really separate and distinct.
x x x. In forcible entry, one is deprived of physical possession of land or building by means of force,
intimidation, threat, strategy, or stealth. In unlawful detainer, one unlawfully withholds possession thereof
after the expiration or termination of his right to hold possession under any contract, express or implied. In
forcible entry, the possession is illegal from the beginning and the basic inquiry centers on who has the prior
possession de facto. In unlawful detainer, the possession was originally lawful but became unlawful by the
expiration or termination of the right to possess, hence the issue of rightful possession is decisive for, in such
action, the defendant is in actual possession and the plaintiffs cause of action is the termination of the
defendants right to continue in possession.
What determines the cause of action is the nature of defendants entry into the land. If the entry is illegal,
then the action which may be filed against the intruder within one year therefrom is forcible entry. If, on the
other hand, the entry is legal but the possession thereafter became illegal, the case is one of unlawful
detainer which must be filed within one year from the date of the last demand.
FACTS
- Ten Forty Realty filed a complaint of ejectment against Marina Cruz who has allegedly occupied the
residential lot in Olongapo City, which they bought from Barbara Galino, by virtue of a Deed of
Absolute Sale. It appears that Barbara sold the same lot to Marina who immediately occupied the
land. (Double Sale) Ten Forty is saying the occupation by Marina was merely tolerated by them.
- Marina Cruzs defense: (1) Ten Forty, being a corporation, is not qualified to own the property
which is a public land (Side Note: constitutional ek ek, they can not own public lands, but can lease
it for 25 years: though they can acquire private lands). (2) Barbara Galino did not sell her property
to Ten Forty but merely obtained a loan. (3) Ten Forty never occupied the property before she did.
Barbara Galino was in possession at the time of the sale, and vacated the lot in favor of Marina. (4)
She was the one who caused the cancellation of the tax declaration in the name of Barbara and a
new one was issued in her name. (5) Ten Forty only obtained its tax declaration 7 months after she
did.
- MTCC ruled in favor of Ten Forty and ordered Marina to vacate.
- RTC reversed. The RTC ruled as follows: 1) respondents entry into the property was not by mere
tolerance of petitioner, but by virtue of a Waiver and Transfer of Possessory Rights and Deed of
Sale in her favor; 2) the execution of the Deed of Sale without actual transfer of the physical
possession did not have the effect of making petitioner the owner of the property, because there
being a corporation, petitioner was disqualified from acquiring the property, which was public land.
- CA affirmed: Case cannot be unlawful detainer because there has been no prior contract between
the parties. Neither can it be forcibly entry because there is no showing that there was prior
physical possession by the petitioner.
ISSUE/S: A. WHAT IS THE REAL NATURE OF THE EJECTMENT SUIT (Forcible Entry or Unlawful
Detainer?) --> Nature of Complaint was really Forcible Entry, but action prescribed; fBUT; in essence,
S.C said, that since Ten Forty did not really have prior possession, which is a requirement in forcible
entry case, wala talaga siyang karapatan. NADA, as said by CA. Kaya petition dismissed. HEHE. (see
also Doctrine)
On the basis of the facts found by the CA and the RTC, we find that petitioner failed to substantiate its case
for unlawful detainer. Admittedly, no express contract existed between the parties. Not shown either was
the corporations alleged tolerance of respondents possession. While possession by tolerance may initially
be lawful, it ceases to be so upon the owners demand that the possessor by tolerance vacate the property.
To justify an action for unlawful detainer, the permission or tolerance must have been present at the
beginning of the possession. Otherwise, if the possession was unlawful from the start, an action for unlawful
detainer would be an improper remedy.
SIDE NOTE: Ten Forty failed to substantiate its unlawful detainer claim -- mere bare allegations. Its
theories are also in a way contradicting. He was claiming that there was tolerance/lawful possession
allowed by it (Unlawful Detainer, then later it says that the possession was illegal from the beginning
(Forcible Entry)
As the bare allegation of petitioners tolerance of respondents occupation of the premises has not been
proven, the possession should be deemed illegal from the beginning. Thus, the CA correctly ruled that the
ejectment case should have been for forcible entryan action that had already prescribed, however, when
the Complaint was filed on May 12, 1999. The prescriptive period of one year for forcible entry cases is
reckoned from the date of respondents actual entry into the land, which in this case was on April 24, 1998.
In its Complaint,
petitioner alleged that, having acquired the subject property from Barbara Galino on December 5,
1996, it was the true and absolute owner thereof; that Galino had sold the property to Respondent
Cruz on April 24, 1998 that after the sale, the latter immediately occupied the property, an action that
was merely tolerated by petitioner; and that, in a letter given to respondent on April 12, 1999,
petitioner had demanded that the former vacate the property, but that she refused to do so. Petitioner
thereupon prayed for judgment ordering her to vacate the property and to pay reasonable rentals for
the use of the premises, attorneys fees and the costs of the suit.
The above allegations appeared to show the elements of unlawful detainer. They also conferred initiatory
jurisdiction on the MTCC, because the case was filed a month after the last demand to vacatehence, within
the one-year prescriptive period.
However, what was actually proven by petitioner was that possession by respondent had been illegal from
the beginning. While the Complaint was crafted to be an unlawful detainer suit, petitioners real cause of
action was for forcible entry, which had already prescribed.
Consequently, the MTCC had no more jurisdiction over the action.
The appellate court, therefore, did not err when it ruled that petitioners Complaint for unlawful detainer was
a mere subterfuge or a disguised substitute action for forcible entry, which had already prescribed. To repeat,
to maintain a viable action for forcible entry, plaintiff must have been in prior physical possession of the
property; this is an essential element of the suit. (Which Ten Forty Realty never had)

B. WON Marina Cruz may be validly ejected from the property NO

RULING:

1. In a contract of sale, the buyer acquires the thing sold only upon its delivery. The execution of a
public instrument gives rise to a presumption of delivery, but this presumption is destroyed when
delivery is not effected because of a legal impediment. Constructive delivery is deemed negated
upon failure of vendee to take actual possession of the land.

Ten Forty was not able to take possession and the SC found it highly unlikely that they allowed
occupation of Marina by mere tolerance. (Why did you allow her to build improvements and repairs
knowing that it was also sold to her?)

2. In cases of double sale, the person who first recorded it in the Registry of Property shall be
considered the lawful owner. In this case, however, petitioner was unable to establish that the
Deed was recorded in the Registry of Deeds of Olongapo. An unverified notation on the Deed is not
equivalent to a registration. In the absence of this requirement, the law gives preferential right to
the buyer who in good faith is first in possession.
3. To determine who is first in possession, the following parameters have been established:
a. Possession includes not only material but also symbolic possession
b. Possessors in good faith are not aware of any flaw in their title or mode of acquisition
c. Buyers of property that is in possession of persons other than the seller must be wary
they must investigate
d. Good faith is always presumed. Burden of proof rests on the one alleging bad faith.

Property has not been delivered, hence Ten Forty did not acquire possession either materially or
symbolically. Petitioner has not proven that respondent was aware of any defect to her title. At the time,
the property had not been registered which was why Marina relied on tax declarations. Galino was
actually occupying the property when respondent took possession. Thus, there was no circumstance
that could have required her to investigate further.

4. Further, private corporations are disqualified from acquiring lands of public domain. At the time of
the sale, there is no evidence that the property had already ceased to be of public domain.

DECI: Petition DENIED