Lagunilla vs Velasco

[G.R. 169276 June 16, 2009]

FACTS:

- Fr. Patricio, Magdalena, Venancio, Macaria ( all surnamed Monis) and Andrea Monis
Velasco are siblings
- Venancio had two children (herein petitioners) : Dionisia Monis Lagunilla and Rafael
Monis.
- Fr. Patricio and Magdalena acquired several properties in La Union and one in
Quezon City.The Q.C. property was co-owned by Patricio and Magdalena with
Spouses Andrea Monis-Velasco and Pedro Velasco.
- After death of Patricio and Magdalena, Andrea and Macaria executed a deed of
extrajudicial settlement with Donation and donated it to Andreas Son : Pedro Monis
Velasco Jr.

PROCEDURE:
- Petitioners, Dionisia and Rafael instituted an action for Annulment of Documents
and Damages before RTC on the ground of the alleged fraudulent act committed by
Andrea and Macaria that they misrepresented themselves as the only surviving heirs
of Patricio and Magdalena.
- Petitioners alleged that they have the right to represent their deceased father
Venancio (being nephew and niece of Patricio and Magdalena) and that they have
rights as co heirs to the QC Property. They further sought the cancellation of the title
and tax declarations.
- Respondents countered that nowhere in the deed did they assert to be the only
surviving heirs, they also added that the petitioners already received advances of
their share of the properties and that there still other properties not yet partitioned
from which the petitioners could obtain reparation.
- No amicable settlement was reached during the pre trial.
- Petitioners moved for the amendment of the complaint to implead Pedro (donee)
raising that he is an indispensable party. RTC denied the motion.
- RTC decided in favor of respondents: Art 887 NCC Petitioners are not compulsory
heirs. Declaration of respondents that they were the only heirs is a valid way of non
recognition of petitioners claim.
- CA affirmed RTC: ruled that the petitioners are heirs but they are not compulsory
heirs and that they cannot invoke bad faith.
- Appellate court refused to annul the contractin view of the other properties
previously received by the petitioners. CA also held that prayer for annulment of
donation was belatedly raised by the petitioners.

ISSUE/S:
- WoN Pedro (donee) is an indispensable party.
RULING:
- The general rule with reference to parties to a civil action pursuant to Section 7 Rule
3 of Rules of Court requires the joinder of all necessary parties and the joinder of all
indispensable partiesunder any and all conditions.
- Jurispridence holds that an indispensable party is a party who has interest in the
controversy or subject matter that a final adjudication cannot be made in his
absence without injuring or affecting that interest. An indispensable party is one
who must be included in an action before it may properly go forward.
- A person is not indispensable if his interest in controversy or subject matter is
seperable.
- CA held that the petitioners sole desire was the annulment of the extrajudicial
settlement which is separated from the issue of donation.
- SC disagrees with CA: Pedro is an indispensable party.
- At the time of filing of the complaint the title of the Quezon City property was
already transferred to Pedro.
- Even if the court will only resolve the validity of the extrajudicial settlement, there
would be no final adjudication of the case without involving Pedros interest. His
interest in the controversy and the subject matter is not separable from the
interests of the other parties.
- Well settled is the rule that joinder of indispensable parties is mandatory. It is a
condition sine qua non to the exercise of judicial power. Without the presence of
indispensable parties, the judgment of the court cannot attain finality.
- Nevertheless the non joinder of indispensable parties is not a ground for dismissal of
an action. The remedy is to implead the non party claimed to be indispensable.
- Parties may be added by order of the court on motion of the party or on its own
initiative at any stage. If the plaintiff refuses to implead an indispensable party then
the court may dismiss the complaint.

FALLO
WHEREFORE, the Decision of the Court of Appeals dated July 13, 2005 in CA-
G.R. CV No. 56998 is SET ASIDE.Let the case be REMANDED to the Regional Trial
Court for the inclusion of Pedro Velasco, Jr. as an indispensable party, and for
further proceedings.