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Republic of the Philippines

G.R. No. L-47475 August 19, 1988
MANOTOK REALTY, INC., petitioner,
TE ONORA!LE "OSE . TECSON, "u#g$ o% t&$ Cou't o% ()'st I*st+*,$ o%
M+*)-+ +*# NILO MA.LANGA/A, respondents.
Ceferino V. Argueza for petitioner.
Magtanggol C. Gunigundo for respondents.

In a coplaint filed b! the petitioner for recover! of possession and daa"es a"ainst
the private respondent, the then #ourt of $irst Instance of Manila rendered %ud"ent,
the dispositive portion of &hich provides inter alia'
(H)R)$OR), %ud"ent is hereb! rendered'
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+c, In #ivil #ase No. -./-., declarin" the defendant Nilo
Madlan"a&a as a builder or possessor in "ood faith0 orderin" the
plaintiff to reco"ni1e the ri"ht of said defendant to reain in 2ot No.
345, 6loc7 8, of the #lara Tabuntin" Subdivision until after he shall
have been reibursed b! the plaintiff the su of P-,599.99, &ithout
pronounceent as to costs. +p. .4, Rollo,
Not satisfied &ith the trial court:s decision, the petitioner appealed to the #ourt of
;ppeals and upon affirance b! the latter of the decision belo&, the petitioner elevated
its case to this #ourt.
On <ul! 83, 8=--, &e issued a resolution dated <ul! 88, 8=-- den!in" the petitioner:s
petition for lac7 of erit. Hence, on ;u"ust 5, 8=--, the petitioner filed &ith the trial
court, presided over b! respondent <ud"e <ose H. Tecson, a otion for the approval of
petitioner:s e*ercise of option and for satisfaction of %ud"ent, pra!in" that the court
issue an order' a, approvin" the e*ercise of petitioner:s option to appropriate the
iproveents introduced b! the private respondent on the propert!0 b, thereafter,
private respondent be ordered to deliver possession of the propert! in >uestion to the
On October -, 8=--, the respondent %ud"e issued the disputed order, to &it'
;ctin" on the otion for approval of plaintiffs e*ercise of option and
for satisfaction of %ud"ent filed b! the plaintiff, and the opposition
thereto interposed b! the defendant, both throu"h counsels, and
after a %udicious revie& of all the facts and circustances obtainin"
in this case, in the li"ht of statutor! provisions +;rt. ?, Ne& #ivil
#ode, and %urisprudential doctrines +Vide, 6enares v. #apitol
Subdivision, Inc., 2@-339 +Nov. .=, 8=?9,, and considerin" further
the definitive rulin" of our Supree Tribunal in the case of <ose #.
#ristobal v. ;le%andro Melchor, A.R. No. 2@43.93 proul"ated on
<ul! .=, 8=--, &herein the #ourt sa!s'
"This Court, applying the principle of equity, need not be bound to a
rigid application of the law but rather its action should confor to the
conditions or e!igencies of a gi"en proble or situation in order to
grant relief that it will ser"e the ends of #ustice."
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the #ourt is of the considered vie& that under the peculiar circustances &hich
supervened after the institution of this case, li7e, for instance, the introduction of
certain a%or repairs of and other substantial iproveents on the controverted
propert!, the instant otion of the plaintiff is not &ell@ta7en and therefore not le"all!
proper and tenable.
(H)R)$OR), and for lac7 of erit, the instant otion for approval
of the plaintiff:s fai@rn of option and for satisfaction of %ud"ent
should be, as hereb! it is, denied. +pp. 45@4?, Rollo,
;fter a denial of its otion for reconsideration, the petitioner filed the present petition
for andaus alle"in" that the respondent %ud"e coitted "rave abuse of discretion
in den!in" his otion to e*ercise option and for e*ecution of %ud"ent on the "rounds
that under ;rticles 44/ and 54? of the #ivil #ode, the e*ercise of option belon"s to the
o&ner of the propert!, &ho is the petitioner herein, and that upon finalit! of %ud"ent,
the prevailin" part! is entitled, as a atter of ri"ht, to its e*ecution &hich is onl! a
inisterial act on the part of the respondent %ud"e.
On ;pril 85, 8=-/, the private respondent filed his coent on the petition alle"in"
that the sae has alread! becoe oot and acadeic for t&o reasons' first, fire
"utted not onl! the house of the private respondent but the a%orit! of the houses in
Tabuntin" )state0 and second, as a result of the said fire, the then $irst 2ad! and
Metro Manila Aovernor Ielda R. Marcos has placed the disputed area under her
Bonal Iproveent Pro%ect, thereb! allo&in" the victis of the fire to put up ne&
structures on the preises, so that the &illin"ness and readiness of the petitioner to
e*ercise the alle"ed option can no lon"er be e*ercised since the sub%ect@atter thereof
has been e*tin"uished b! the fire. $urtherore, the President of the Philippines has
alread! issued a Presidential Decree for the e*propriation of certain estates in Metro
Manila includin" the Tabuntin" )state. Therefore, the beneficient and huanitarian
purpose of the Bonal Iproveent Pro%ect and the e*propriation proceedin" &ould be
defeated if petitioner is allo&ed to e*ercise an option &hich &ould result in the
e%ectent of the private respondent.
On Deceber ./, 8=/9, Presidential Decree +P.D., No. 8??= &as issued providin" for
the e*propriation of the Tabuntin" )state. Ho&ever, this decree &as challen"ed
before this #ourt in A.R. No, 558?? entitled The C)lisa R. Manoto7, et al. v. National
Housin" ;uthorit!, et al.C Hence, &e decided to hold the decision on this petition
pendin" the resolution of the above entitled case.
On Ma! .8, 8=/-, the #ourt rendered a decision in the )lisa Manoto7 case +Manoto7
v. National Housin" ;uthorit!, 859 S#R; /=, rulin" that P.D. 8??= is unconstitutional
for bein" violative of the due process clause. Thus, since the present petition has not
been rendered oot and acadeic b! the decision in said case, &e &ill no& decide on
its erits.
;s stated earlier, the petitioner ar"ues that since the %ud"ent of the trial court has
alread! becoe final, it is entitled to the e*ecution of the sae and that oreover,
since the house of the private respondent &as "utted b! fire, the e*ecution of the
decision &ould no& involve the deliver! of possession of the disputed area b! the
private respondent to the petitioner.
(e find erit in these ar"uents.
(hen the decision of the trial court becae final and e*ecutor!, it becae incubent
upon the respondent %ud"e to issue the necessar! &rit for the e*ecution of the sae.
There is, therefore, no basis for the respondent %ud"e to den! the petitioner:s otion to
avail of its option to approriate the iproveents ade on its propert!.
In the case of $uenas ". Mandi +858 S#R; 539, 545,, &e said'
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...2i7e&ise settled is the rule that after a %ud"ent has becoe final,
no additions can be ade thereto, and nothin" can be done
there&ith e*cept its e*ecution, other&ise there &ould be no end to
le"al processes. +$abular v. #ourt of ;ppeals, 88 = S#R; 3.=,
Neither can the respondent %ud"e den! the issuance of a &rit of e*ecution because the
private respondent &as ad%ud"ed a builder in "ood faith or on the "round of Cpeculiar
circustances &hich supervened after the institution of this case, li7e, for instance, the
introduction of certain a%or repairs of and other substantial iproveents...C because
the option "iven b! la& either to retain the preises and pa! for the iproveents
thereon or to sell the said preises to the builder in "ood faith belon"s to the o&ner of
the propert!. ;s &e have in %ueel ". &laes +8 S#R; 885=,88?3,'
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...The plaintiffs clai that their second cause of action is based on
;rticle 44/ in connection &ith ;rt. 54?, of the ne& #ivil #ode. ;
cursor! readin" of these provisions, ho&ever, &ill sho& that the! are
not applicable to plaintiff:s case. Dnder ;rticle 44/, the ri"ht to
appropriate the &or7s or iproveents or to obli"e the one &ho built
or planted to pa! the price of the land: belon"s to the o&ner of the
land. The onl! ri"ht "iven to the builder in "ood faith is the ri"ht to
reiburseent for the iproveents0 the builder, cannot copel the
o&ner of the land to sell such land to the forer. ...
;"ain, in the recent case of 'az Mercado, et al. ". (on. Court of Appeals, et al., +A.R.
No. 2@ 44998, <une 89, 8=//,, &e said'
... To be deeed a builder in "ood faith, it is essential that a person
assert title to the land on &hich he builds0 i.e., that he be a
possessor in concept of o&ner +;rt. 5.5, #ivil #ode0 2ope1, Inc. v.
Phil. )astern Tradin" #o., Inc., =/ Phil. 34/, and that he be una&are
:that there e*ists in his title or ode of ac>uisition an! fla& &hich
invalidates it.: +;rt. 5.?, #ivil #ode0 Aranados v. Monton, /? Phil. 4.0
;rriola v. Aoe1 de la Serna, 84 Phil. ?.-0 See also Manoto7 Realt!,
Inc. v. #.;., 834 S#R; 3.=, citin" #ara v. 2aureta, 893 S#R; -, It
is such a builder in "ood faith &ho is "iven the 8i"ht to retain the
thin", even as a"ainst the real o&ner, until he has been reibursed
in full not onl! for the necessar! e*penses but also for useful
e*penses. +;rt. 54?, #ivil #ode0 Policarpio v. #;., 8.= S#R; 580
Sariento v. ;"ana, 8.= S#R; 8..80 cf, Eueto v. #.;., 8.. S#R;
.9?, ...
$urtherore, the private respondent:s "ood faith ceased after the filin" of the
coplaint belo& b! the petitioner. In the case of Mindanao Acadey, )nc. ". *ap +83
S#R; 8=9,8=?,, &e ruled'
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...;lthou"h the bad faith of one part! neutrali1es that of the other and
hence as bet&een theselves their ri"hts &ould be as if both of
the had acted in "ood faith at the tie of the transaction, this le"al
fiction of Fap:s "ood faith ceased &hen the coplaint a"ainst hi
&as filed, and conse>uentl! the court:s declaration of liabilit! for the
rents thereafter is correct and proper . ; possessor in "ood faith is
entitled to the fruits onl! so lon" as his possession is not le"all!
interrupted, and such interruption ta7es place upon service of %udicial
suons +;rts. 544 and 88.3, #ivil #ode,.
Thus, the repairs and iproveents introduced b! the said respondents after the
coplaint &as filed cannot be considered to have been built in "ood faith, uch less,
%ustif! the denial of the petitioner:s fai@rn of option.
Since the iproveents have been "utted b! fire, and therefore, the basis for private
respondent:s ri"ht to retain the preises has alread! been e*tin"uished &ithout the
fault of the petitioner, there is no other recourse for the private respondent but to
vacate the preises and deliver the sae to herein petitioner.
(H)R)$OR), IN VI)( O$ TH) $OR)AOINA, the petition is AR;NT)D and the
respondent %ud"e is hereb! ordered to iediatel! issue a &rit of e*ecution orderin"
the private respondent to vacate the disputed preises and deliver possession of the
sae to the petitioner.