G.R. No.
L-46000 March 18, 1985 attorney's fees' From this decision, the defendant filed an appeal with Branch Ill of
GLICERIO AGUSTIN (Deceased) as Administrator of the Intestate Estate of Susana
Agustin, petitioner-plaintiff-appellant, vs. LAUREANO BACALAN and the PROVINCIAL
SHERIFF OF CEBU, respondents-defendants-appellees.chanrobles virtual law library
GUTIERREZ, JR., J.:
The precursor of this case was a complaint for ejectment with damages filed by
plaintiff-appellant Agustin, as adininistrator of the Intestate Estate of Susana Agustin,
against defendant-appellee Bacalan, before the City Court of
Cebu.chanroblesvirtualawlibrarychanrobles virtual law library
Bacalan is a lessee of a one-door ground floor space in a building owned by the late
Susana Agustin. Due to nonpayment of rentals despite repeated demands an action
to eject him was filed.chanroblesvirtualawlibrarychanrobles virtual law library
In his complaint, the plaintiff-appellant prayed that the defendant-appellee be
ordered to immediately vacate the place in question, to pay plaintiff-appellant the
sum of P2,300.00 representing arrearages in rentals plus the corresponding rentals
until he actually vacates the place, attorney's fees, expenses, and
costs.chanroblesvirtualawlibrarychanrobles virtual law library
In his answer, the defendant-appellee included a counter-claim alleging that the
present action was "clearly unfounded and devoid of merits, as it is tainted with
malice and bad faith on the part of the plaintiff for the obvious reason that plaintiff
pretty well knows that defendant does not have any rentals in arrears due to the
estate of Susana Agustin, but notwithstanding this knowledge, plaintiff filed the
present action merely to annoy, vex, embarrass and inconvenience the defendant."
He stated, "That by virtue of the unwarranted and malicious filing of this action by
the plaintiff against the defendant, the latter suffered, and will continue to suffer,
actual and moral damages in the amount of no less than P50,000.00; P10,000.00 in
concept of exemplary damages. In addition, defendant has been compelled to retain
the services of undersigned counsel to resist plaintiffs' reckless, malicious and
frivolous claim and to protect and enforce his rights for which he obligated himself to
pay the further sum of P3,500.00 as attorney's fees."chanrobles virtual law library
The City Court of Cebu subsequently rendered judgment dismissing the counterclaim
and ordering the defendant to vacate the premises in question and to pay the
plaintiff the sum of P3,887.10 as unpaid back rentals and the sum of P150.00 as
the Court of First Instance of Cebu. The case was designated as Civil Case No. R-
12430.chanroblesvirtualawlibrarychanrobles virtual law library
Availing of Republic Act 6031 which does away with trials de novo in appeals before
it, the Court of First Instance rendered a decision, the dispositive portion of which
reads:
WHEREFORE, based on all the foregoing considerations, the appealed judgment is
hereby set aside. Judgment is hereby required in favor of the defendant-chanrobles
virtual law library
1. Ordering the plaintiff to pay.
a) P10,000.00 as moral damages;chanrobles virtual law library
b) P5,000.00 as exemplary damages; chanrobles virtual law library
c) P1,000.00 as attorney's fees; and
2. With costs 0against plaintiff.chanroblesvirtualawlibrarychanrobles virtual law
library
JUDGMENT REVERSED.
No appeal was taken by the plaintiff-appellant. The decision lapsed into finality and
became executory. A writ of execution was issued by virtue of which a notice to sell
at public auction real properties belonging to the estate of Susana Agustin was
issued by the Deputy Sheriff to satisfy judgment in the case. Plaintiff's counsel filed a
motion for reconsideration, confessing his fault and giving the reason why he failed
to perfect the appeal on time. The motion was
denied.chanroblesvirtualawlibrarychanrobles virtual law library
Thereafter, with the aid of new counsel, the plaintiff-appellant filed a complaint with
Branch V, Court of First Instance of Cebu, against the defendant and the Deputy
Sheriff of Cebu for the declaration of the nullity of the above-cited decision of Branch
III, Court of First Instance of Cebu in the ejectment case on the ground that the
exercise of its appellate jurisdiction was null and void from the beginning for the
following reasons:
(a) It grants relief in the total sum of P16,000.00 (exclusive of costs) distributed thus:
1
P10,000.00 as moral damages chanrobles virtual law library
P5,000.00 as exemplary damageschanrobles virtual law library
P1,000.00 as attorney's fees
which is clearly beyond the jurisdiction of the City Court of Cebu; Section 88 of the
Judiciary Act of 1948, as amended by Rep. Acts Nos. 2613 and 3828, limits the
jurisdiction of the city courts in civil cases to P10,000.00 as the maximum amount of
the demand (exclusive of interest and costs);chanrobles virtual law library
(b) Moreover, said Decision (Annex "G") grants moral damages to the defendant in
the sum of P10,000.00 which constitutes a grave abuse of discretion amounting to
lack of jurisdiction, there being no evidence to support it and the subject matter of
the suit in Civil Case No. R-13504 being purely contractual where moral damages are
not recoverable.
A motion to dismiss was filed by the defendant on the grounds that the plaintiff has
no cause of action and that the court lacks jurisdiction to declare the nullity of a
decision of another branch of the Court of First Instance of
Cebu.chanroblesvirtualawlibrarychanrobles virtual law library
While rejecting the second ground for the motion to dismiss, the court sustained the
defendant and ruled:
Clearly from a reading of the complaint, the plaintiff seeks the annulment of the
decision rendered by the Third Branch of this Court because the award exceeded the
jurisdiction amount cognizable by the City Court of Cebu and the said Branch III of
this Court has no jurisdiction to award the defendants herein (plaintiff in Civil Case
No. 12430) an amount more than P10,000.00;chanrobles virtual law library
It is the considered opinion of this Court that this allegation of the herein plaintiff
cannot be availed of as a ground for annulment of a judgment. It may perhaps, or at
most, be a ground for a petition for certiorari. But then, the remedy should be
availed of within the reglementary period to appeal. Nevertheless, even if the
plaintiff did take his cause by certiorari, just the same, it would have been
futile....chanroblesvirtualawlibrarychanrobles virtual law library
xxx xxx xxxchanrobles virtual law library
In fine, this Court believes that the present complaint fails to allege a valid cause of
action as the same is only a clear attempt at utilizing the remedy for the annulment
of the judgment rendered by this Court in Civil Case No. 12430 to offset the adverse
effects of failure to appeal.
Plaintiff-appellant's motion for reconsideration was denied, prompting him to file an
appeal before the Court of Appeals, which, in a resolution, certified the same to us
on the ground that it involves pure questions of
law.chanroblesvirtualawlibrarychanrobles virtual law library
We ruled in Macabingkil v. People's Homesite and Housing Corporation (72 SCRA
326, citing Reyes v. Barretto-Datu, 94 Phil. 446, 448-449)-
Under our rules of procedure, the validity of a judgment or order of the court, which
has become final and executory, may he attacked only by a direct action or
proceeding to annul the same, or by motion in another case if, in the latter case, the
court had no jurisdiction to enter the order or pronounce the judgment (section 44,
Rule 39 of the Rules of Court). The first proceeding is a direct attack against the
order or judgment, because it is not incidental to, but is the main object of, the
proceeding. The other one is the collateral attack, in which the purpose of the
proceedings is to obtain some relief, other than the vacation or setting aside of the
judgment, and the attack is only an incident. (I Freeman on Judgments, sec. 306,
pages 607-608.) A third manner is by a petition for relief from the judgment order as
authorized by the statutes or by the rules, such as those expressly provided in Rule
38 of the Rules of Court, but in this case it is to be noted that the relief is granted by
express statutory authority in the same action or proceeding in which the judgment
or order was entered ...
The question is thus poised, whether or not the present action for the annulment of
the judgment in the ejectment case is the proper remedy after it has become final
and executory.chanroblesvirtualawlibrarychanrobles virtual law library
To this procedural dilemma, the solution lies in the determination of the validity of
the judgment sought to be annulled, for against a void judgment, plaintiff-appellant's
recourse would be proper.chanroblesvirtualawlibrarychanrobles virtual law library
There is no question as to the validity of the court's decision with respect to the issue
of physical possession of property, the defendant-appellee's right to the same having
been upheld. However, the plaintiff-appellant assails the money judgment handed
2
down by the court which granted damages to the defendant-appellee. By reason
thereof, he seeks the declaration of the nullity of the entire
judgment.chanroblesvirtualawlibrarychanrobles virtual law library
It is the plaintiff-appellant's contention that moral damages may not properly be
awarded in ejectment cases, the only recoverable damages therein being the
reasonable compensation for use and occupancy of the premises and the legal
measure of damages being the fair rental value of the
property.chanroblesvirtualawlibrarychanrobles virtual law library
Plaintiff-appellant loses sight of the fact that the money judgment was awarded the
defendant-appellee in the concept of a counterclaim. A defending party may set up a
claim for money or any other relief which he may have against the opposing party in
a counterclaim (Section 6, Rule 6, Revised Rules of Court). And the court may, if
warranted, grant actual, moral, or exemplary damages as prayed for. The grant of
moral damages, in the case at bar, as a counterclaim, and not as damages for the
unlawful detention of property must be upheld. However, the amount thereof is
another matter.chanroblesvirtualawlibrarychanrobles virtual law library
Plaintiff-appellant raises the issue of whether or not the Court of First Instance may,
in an appeal, award the defendant-appellee's counterclaim in an amount exceeding
or beyond the jurisdiction of the court of
origin.chanroblesvirtualawlibrarychanrobles virtual law library
It is well-settled that a court has no jurisdiction to hear and determine a set-off or
counterclaim in excess of its jurisdiction (Section 5, Rule 5, Revised Rules of Court;
Ago v. Buslon, 10 SCRA 202). A counterclaim beyond the court's jurisdiction may only
be pleaded by way of defense, the purpose of which, however, is only to defeat or
weaken plaintiff's claim, but not to obtain affirmative relief (Section 5, Rule 5,
Revised Rules of Court). Nevertheless, the defendant-appellee, in the case at bar, set
up his claim in excess of the jurisdiction of the city court as a compulsory
counterclaim. What is the legal effect of such a move?chanrobles virtual law library
Pertinent to our disposition of this question is our pronouncement in the case of
Hyson Tan, et al. v. Filipinas Compania de Seguros, et al., (G.R. No. L-10096, March
23, 1956) later adopted in Pindangan Agricultural Co., Inc. v. Dans (6 SCRA 14) and
the later case of One Heart Club, Inc. v. Court of Appeals (108 SCRA 416) to wit:
xxx xxx xxxchanrobles virtual law library
... An appellant who files his brief and submits his case to the Court of Appeals for
decision, without questioning the latter's jurisdiction until decision is rendered
therein, should be considered as having voluntarily waives so much of his claim as
would exceed the jurisdiction of said Appellate Court; for the reason that a contrary
rule would encourage the undesirable practice of appellants submitting their cases
for decision to the Court of Appeals in expectation of favorable judgment, but with
intent of attacking its jurisdiction should the decision be unfavorable. ...
Thus, by presenting his claim voluntarily before the City Court of Cebu, the
defendant-appellee submitted the same to the jurisdiction of the court. He became
bound thereby. The amount of P10,000.00 being the jurisdictional amount assigned
the City Court of Cebu, whose jurisdiction the defendant-appellee has invoked, he is
thereby deemed to have waived the excess of his claim beyond P10,000.00. It is as
though the defendant-appellee had set up a counterclaim in the amount of
P10,000.00 only. May the Court of First Instance then, on appeal, award defendant-
appellee's counterclaim beyond that amount?chanrobles virtual law library
The rule is that a counterclaim not presented in the inferior court cannot be
entertained in the Court of First Instance on appeal (Francisco, The Revised Rules of
Court in the Philippines, Vol. III, p. 26, citing the cases of Bernardo v. Genato, 11 Phil.
603 and Yu Lay v. Galmes, 40 Phil. 651). As explained in Yu Lay v. Galmes- "Upon an
appeal to a court of first instance from the judgment of a justice of the peace, it is
not possible, without changing the purpose of the appeal, to alter the nature of the
question raised by the complaint and the answer in the original action. There can be
no doubt, therefore, of the scope of the doctrine laid down in the several decisions
of the Court. Consequently, We hold that, upon an appeal to the Court of First
Instance, the plaintiff as well as the defendant cannot file any pleading or allegation
which raises a question essentially distinct from that raised and decided in the justice
of the peace court. "This rule was reiterated in cases from Ng Cho Cio v. Ng Diong (1
SCRA 275) to Development Bank of the Philippines v. Court of Appeals (116 SCRA
636).chanroblesvirtualawlibrarychanrobles virtual law library
Thus, the defendant-appellee's counterclaim beyond P10,000.00, the jurisdictional
amount of the city Court of Cebu, should be treated as having been deemed waived.
It is as though it has never been brought before trial court. It may not be entertained
on appeal.chanroblesvirtualawlibrarychanrobles virtual law library
The amount of judgment, therefore, obtained by the defendant-appellee on appeal,
cannot exceed the jurisdiction of the court in which the action began. Since the trial
3
court did not acquire jurisdiction over the defendant's counterclaim in excess of the
jurisdictional amount, the appellate court, likewise, acquired no jurisdiction over the
same by its decisions or otherwise. Appellate jurisdiction being not only a
continuation of the exercise of the same judicial power which has been executed in
the court of original jurisdiction, also presupposes that the original and appellate
courts are capable of participating in the exercise of the same judicial power (See 2
Am. Jur. 850; Stacey Cheese Company v. R.E. Pipkin, Appt. 155 NC 394, 71 S.E. 442,
37 LRA 606) It is the essential criterion of appellate jurisdiction that it revises and
corrects the proceedings in a cause already instituted, and does not create that
cause (See 2 Am. Jur 850 citing Marbury v. Madison, 1 Cranch US, 137, 2 L. ed.
60).chanroblesvirtualawlibrarychanrobles virtual law library
MODIFIED, Civil Case No. R-13462 is ordered DISMISSED insofar as the decision
sought to be annulled upholds the defendant's right to possession of the disputed
property. The defendant's counterclaim for damages is GRANTED to the extent of
TEN THOUSAND (P10,000.00) PESOS. The grant of SIX THOUSAND (P6,000.00) PESOS
in excess of such amount is hereby declared NULL and VOID, for having been
awarded beyond the jurisdiction of the court.chanroblesvirtualawlibrarychanrobles
virtual law library
SO ORDERED.

It is, of course, a well-settled rule that when court transcends the limits prescribed
for it by law and assumes to act where it has no jurisdiction, its adjudications will be
utterly void and of no effect either as an estoppel or otherwise (Planas v. Collector of
Internal Revenue, 3 SCRA 395; Parades v. Moya, 61 SCRA 526). The Court of First
Instance, in the case at bar, having awarded judgment in favor of the defendant-
appellee in excess of its appellate jurisdiction to the extent of P6,000.00 over the
maximum allowable award of P10,000.00, the excess is null and void and of no
effect. Such being the case, an action to declare the nullity of the award as brought
by the plaintiff-appellant before the Court of First Instance of Cebu, Branch V is a
proper remedy.chanroblesvirtualawlibrarychanrobles virtual law library

The nullity of such portion of the decision in question, however, is not such as to
affect the conclusions reached by the court in the main case for ejectment. As held
in Vda. de Pamintuan v. Tiglao (53 Phil. 1) where the amount set up by the defendant
was not proper as a defense and it exceeded the inferior court's jurisdiction, it
cannot be entertained therein, but the court's jurisdiction over the main action will
remain unaffected. Consequently, the decision over the main action, in the case at
bar, must stand, best remembering that a counter-claim, by its very nature, is a
cause of action separate and independent from the plaintiff's claim against the
defendant.chanroblesvirtualawlibrarychanrobles virtual law library

WHEREFORE, the decision of the Court of First Instance of Cebu, Branch III in Civil
Case No. R-12430 for ejectment is hereby DECLARED NULL AND VOID insofar as it
awards damages on the defendant-appellee's counterclaim in excess of P6,000.00
beyond its appellate jurisdiction. The decision in all other respects is AFFIRMED. The
order of the Court of First Instance of Cebu, Branch V dismissing Civil Case No. R-
13462 for declaration of nullity of judgment with preliminary injunction is hereby
4
G.R. No. 80739 August 20, 1992
GRACIA R. JOVEN, petitioner,
vs.
COURT OF APPEALS, HON. MANUEL A. PATRON, in his capacity as Presiding Judge of
the RTC, Branch 59, Lucena City, Roberto Paguia & Fernando Lasala, respondents.
De Castro & Cagampang Law Offices for petitioner.
Castillo, Laman, Tan & Pantaleon for private respondents.
CRUZ, J.:
The petitioner was the registered owner of three parcels of land which she
mortgaged in favor of the Development Bank of the Philippines. Upon the
extrajudicial foreclosure of the mortgage due to her failure to pay her loan, the
properties were sold at public auction to DBP as the biggest bidder. A certificate of
sale was issued and annotated on the certificate of title on November 17, 1982.
After the expiration of the redemption period, no redemption having been made by
the petitioner, DBP sold the subject properties to Roberto Paguia, one of the herein
private respondents, through a deed of sale executed on December 17, 1985. On
January 30, 1986, Paguia took possession of the properties through his
representative, Fernando Lasala, the other private respondent.
Earlier, the petitioner had filed on December 3, 1985, an action before the Regional
Trial Court of Lucena City (raffled later to Branch 55) for the annulment of the
mortgage and its foreclosure. Named as defendants were DBP and the private
respondents. Later, when her application for preliminary injunction and restraining
order was denied, she lodged with the Municipal Circuit Trial Court of Lucban-
Sampaloc complaint against the private respondents for forcible entry with a prayer
for writ of mandatory injunction. This was docketed as Civil Case No. 155.
In a decision dated May 14, 1986, the case was dismissed for lack of jurisdiction. But
on May 29, 1986, the petitioner filed a motion for reconsideration, which was
granted. In a resolution dated July 11, 1986, 1 the private respondents were ordered
to: 1) immediately restore and deliver possession of the subject properties to the
petitioner; 2) render to the petitioner an accounting of all the fruits and products
gathered from said property from the time they took possession thereof until they
vacate the same; and 3) reimburse the petitioner the total cost of such accounting.
This resolution was reversed on appeal by the Regional Trial Court of Lucena City,
Branch 59, 2 which held that the court a quo had no jurisdiction over the ejectment
case because of the issue of ownership raised therein and that, assuming such
jurisdiction, the decision had already become final and executory when the
resolution dated July 11, 1986, was rendered. The petitioner elevated the case to the
respondent Court of Appeals, which sustained the assailed decision in toto. 3
She is now before us in this petition for review on certiorari, contending that the
Municipal Circuit Trial Court had jurisdiction over the ejectment case and that the
private respondents were guilty of forcible entry on the subject premises for
occupying the same without judicial authorization.
The petition has merit:
The respondents argue that the Municipal Circuit Trial Court had no jurisdiction over
the action for forcible entry on the principal ground that a question of ownership
was involved therein. This view does not jibe with the following observations from
Chief Justice Moran based on a consistent line of decisions from this Court: 4
It would be a mistake to suppose that an action involves a question of title merely
because the plaintiff may allege in his complaint that he is the owner of the land. Just
as the plaintiff may introduce proof of his title in order to show the character of his
(sic) prior possession, so be may allege ownership in himself as a material and
relevant fact in the case, and the insertion of such an allegation in the complaint
cannot by any possibility place the cause beyond the jurisdiction of the magistrate's
court, provided it otherwise sufficiently appears that what the plaintiff really seeks is
the restoration of possession as against an intruder who has seized the property
within the period of one year. Much less can the defendant in such an action defeat
the jurisdiction of the magistrate's court by setting up title in himself. In this
connection it should be borne in mind that the factor which defeats the jurisdiction
of the court of the justice of the peace is the necessity to adjudicate the question of
title. The circumstance that proof of title is introduced at the hearing or that a claim
of ownership is made by either or both of the parties is not material
This ruling is embodied in Sec. 33, (2), Batas Pambansa Blg. 129, which vests
municipal courts with:
5
Exclusive original jurisdiction over cases of forcible entry and unlawful detainer;
Provided, that when, in such cases, the defendant raises the question of ownership
in his pleadings and the question of possession cannot be resolved without deciding
the issue of ownership, the issue of ownership should be resolved only to determine
the issue of possession.
It is true that before the petitioner instituted the action for forcible entry in the
Municipal Circuit Trial Court of Lucban-Sampaloc, the case for annulment of the
mortgage and foreclosure sale, which necessarily involves recovery of ownership,
was already being litigated in the Regional Trial Court of Lucena City. Even so, the
municipal court could, pending final adjudication of that case, exercise its jurisdiction
to determine the right of possession (only) over the subject properties in the
ejectment case.
The private respondents also contend that the Municipal Circuit Trial Court had no
jurisdiction over the complaint for forcible entry because; a) under Section 19 par.
(2) of BP 129, as amended, the Regional Trial Court has exclusive original jurisdiction
over all civil actions which involve the title to, or possession of, real property or any
interest therein; and b) under Section 1, par. A (1) of the Rule on Summary
Procedure, cases of forcible entry and detainer involving the question of ownership
are expressly excluded from the summary jurisdiction of the municipal court.
Curiously, however, they also insist that an action for forcible entry and unlawful
detainer shall be governed by the Rule on Summary Procedure pursuant to Section
36 of BP 129 and that the petitioner is now estopped from assailing the applicability
of that Rule.
There is no question that under Section 1, par. A (1), of the said Rule, the
Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit Trial Courts
have jurisdiction over cases of forcible entry and unlawful detainer except where the
question of ownership is involved or where the damages or unpaid rentals sought to
be recovered by the plaintiff exceed P20,000.00 at the time of the filing of the
complaint. *
However, it is incorrect to say that the question of ownership was involved in the
ejectment case filed by the petitioner simply because she alleged in her complaint
that she was the original owner of the subject properties. That the petitioner
instituted a separate action for the annulment of the mortgage is not a valid reason
either for defeating the summary remedy of ejectment. On the contrary, it only
bolsters the conclusion that the ejectment case did not involve the question of title
as this was the subject of the annulment case before the Regional Trial Court of
Lucena City. The Rule on Summary Procedure was clearly applicable because the
ejectment case involved only the restoration of possession of the subject land and
not its ownership.
The respondent court also sustained the ruling of the Regional Trial Court that the
motion for reconsideration filed by the petitioner with the Municipal Circuit Trial
Court did not stop the running of the reglementary period to appeal because such
motion was a prohibited pleading under Section 15 (c) ** of the Rule on Summary
Procedure. Its conclusion was that the Municipal Circuit Trial Court had already lost
jurisdiction to issue the resolution dated July 11, 1986, because the decision sought
to be reconsidered had then become already final and executory.
We do not agree. The Municipal Circuit Trial Court did not err in holding that the
motion for reconsideration was not covered by the prohibition under Section 15 (c).
The motion prohibited by this section is that which seeks reconsideration of the
judgment rendered by the court after trial on the merits of the case. 5 The decision
dismissing the petitioner's ejectment case for lack of jurisdiction was not an
adjudication on the merits. Review thereof could therefore be sought by the
petitioner through her motion for reconsideration and this motion, which was not
pro forma, had the effect of suspending the running of the period to appeal.
Now, on the issue of possession:
Section 7 of Act No. 3135, as amended by Act No. 4118, provides that in case of
extrajudicial foreclosure of mortgage, the court *** may issue as a matter of course
a writ of possession in favor of the purchaser even during the redemption period,
provided that a proper motion has been filed, a bond is approved, and no third
person is involved.
Section 6 of the Act provides that where an extrajudicial sale is made, "redemption
shall be governed by the provisions of sections four hundred and sixty-four to four
hundred and sixty-six, inclusive, of the Code of Civil Procedure, in so far as these are
not inconsistent with the provisions of this Act."
Sections 464-466 of the Code of Civil Procedure were superseded by Sections 25-27
and Section 31 of Rule 39 of the Rules of Court, which in turn were replaced by
Sections 29 to 31 and Section 35 of Rule 39 of the Revised Rules of Court.
6
Section 35 provides that "if no redemption be made within twelve (12) months after
the sale, the purchaser, or his assignee, is entitled to a conveyance and the
possession of property, . . . The possession of the property shall be given to the
purchaser or last redemptioner by the same officer unless a third party is actually
holding the property adversely to the judgment debtor."
To give effect to his right of possession, the purchaser must invoke the aid of the
courts and ask for a writ of possession. He cannot simply take the law into his own
hands and enter the property without judicial authorization. 6 We have consistently
held that he need not bring a separate and independent suit for this purpose. 7
Nevertheless, it is essential that he ask for and be granted a writ of possession in
order that he may be legally installed in the property he has bought.
Section 63 (b) of P.D. 1529, otherwise known as the Property Registration Decree,
requires that in case of non-redemption, the purchaser at a foreclosure sale shall file
with the Register of Deeds either a final deed of sale executed by the person
authorized by virtue of the power of attorney embodied in the deed of mortgage or
his sworn statement attesting to the fact of non-redemption. The Register of Deeds
shall thereupon issue a new certificate in favor of the purchaser after the owner's
duplicate certificate shall have been previously delivered and canceled.
In F. David Enterprises vs. Insular Bank of Asia and America, 8 this Court held:
It is settled that the buyer in a foreclosure sale becomes the absolute owner of the
property purchased if it is not redeemed during the period of one year after the
registration of the sale. As such, he is entitled to the possession of the said property
and can demand it at any time following the consolidation ownership in his name
and the issuance to him of a new transfer certificate of title. The buyer can in fact
demand possession of the land even during the redemption period except that he
has to post a bond in accordance with Section 7 of Act No. 3135 as amended. No
such bond is required after the redemption period if the property is not redeemed.
Possession of the land then becomes an absolute right of the purchaser as confirmed
owner. Upon proper application and proof of title, the issuance of the writ of
possession becomes a ministerial duty of the court. (Emphasis supplied).
In the case at bar, there is no showing that after the lapse of the redemption period
without the petitioner having redeemed the lands, DBP executed an affidavit of
consolidation of ownership of the subject properties. Neither has it filed with the
Register of deeds a final deed of sale or a sworn statement attesting to the fact of
non-redemption. The circumstance that the properties are still in the name of the
petitioner shows that DBP has also not yet obtained a new certificate of title in its
name. And neither does it appear that DBP, on the basis of its purchase of the lands
at the foreclosure sale, ever secured a writ of possession to authorize its entry into
the said lands.
Not having done any of these, DBP had as yet not acquired any perfected right of
possession that it could transfer to the private respondents. And as the petitioner
continued in actual possession of the subject premises, she could undoubtedly
maintain an action for forcible entry against the private respondents when, not being
armed with a court order or a writ of possession, they simply entered and took
possession of the subject lands.
The 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
hand, violence or terror. In affording this remedy of restitution, the statute seeks to
prevent breaches of the peace and criminal disorder which might ensue from the
withdrawal of the remedy. Another purpose is to discourage those persons who,
believing themselves entitled to the possession of the property, resort to force
rather than to some appropriate action in the courts to assert their claims. 9
Under Section 1, Rule 70, of the Rules of Court, there is forcible entry when one in
physical possession of a land or building is deprived of that possession by another
through force, intimidation, threat, strategy or stealth. The words "by force,
intimidation, threat, strategy or stealth" include every situation or condition under
which one person can wrongfully enter upon real property and exclude another, who
has had prior possession thereof. To constitute the use of "force" as contemplated in
the above-mentioned provision, the trespasser does not have to institute a state of
war. Nor is it even necessary that he use violence against the person of the party in
possession. The act of going on the property and excluding the lawful possessor
therefrom necessarily implies the exertion of force over the property, and this is all
that is necessary. 10
It is noted that the petitioner instituted the action for annulment of mortgage on
December 3, 1985, while the deed of sale in favor of the private respondent was
executed on December 17, 1985. Paguia cannot say that when he took possession of
the subject land on January 30, 1986, he was acting in good faith. Neither can be
7
claim that he had no knowledge of the pendency of that litigation because he was in
fact one of the defendants in that case. In any event, the fact that the titles were still
in the name of the petitioner should have warned him of the need to ascertain the
status of the properties before he took possession of them.
The private respondents also assert that the institution of the ejectment case
resulted in the splitting of a single cause of action into two, one for the recovery of
ownership and possession and the other for recovery of possession de facto.
In Drilon vs. Gaurana, 11 this Court held:
of the injunction did not bar the petitioner from availing herself of the more
appropriate remedy, to wit, the action for forcible entry. 13
In sum, the respondent court erred when it affirmed the decision of the Regional
Trial Court declaring that the Municipal Circuit Trial Court had no jurisdiction over
the ejectment case filed by the petitioner. We find that it had.
ACCORDINGLY, the petition is GRANTED and the resolution of the Municipal Circuit
Trial Court of Lucban, Sampaloc dated July 11, 1986, in Civil Case No. 155 is
REINSTATED. Costs against the private respondents.

It is true that a party may not institute more than one suit for a single cause of action SO ORDERED.
(Rule 2, Sec. 3, Revised Rules of Court) and if two or more complaints are brought for
different parts of a single cause of action, the filing of the first may be pleaded in
abatement of the other (Rule 2, Sec. 4 Revised Rules of Court). However, a forcible
entry or unlawful detainer action has an entirely different subject from that of an
action for reconveyance of title. What is involved in a forcible entry case is merely
the issue of material possession or possession de facto; whereas in an action for
reconveyance, ownership is the issue. So much so that the pendency of an action for
reconveyance of title over the same property does not divest the city or municipal
court of its jurisdiction to try the forcible entry or unlawful detainer case, nor will it
preclude or bar execution of judgment in the ejectment case where the only issue
involved is material possession or possession de facto (De la Cruz v. Court of Appeals,
133 SCRA 520 [1984]).

While there may be identity of parties and subject matter in the two actions, the
issues involved and the reliefs prayed for are not the same. In the annulment suit,
the issue is the validity of the mortgage and the subsequent foreclosure sale
whereas the issue in the ejectment case is whether, assuming the mortgage and
foreclosure sale to be valid, the private respondents have the right to take
possession of the property. In the former case, the relief prayed for is recovery of
ownership of the subject land while in the latter it is restoration of possession
thereof to the petitioner. Hence, the municipal court had jurisdiction to try the
ejectment case while the annulment suit was being litigated in the regional trial
court.

The contention that the petitioner was forum-shopping must also be rejected. As an
injunction cannot be a substitute for the other suits for recovery of possession, 12
such as an action for forcible entry or unlawful detainer and accion publiciana, denial

8
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.
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 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, and 1028. 1
On January 7,1985, the Municipal Trial Court dismissed private respondents'
complaint for forcible entry. 2 On appeal, the Regional Trial Court of Antipolo, Rizal,
Branch LXXI sustained the dismissal by the Municipal Trial Court. 3
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 Municipal Trial Court and the Regional Trial Court. 4
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 possession. 5 Petitioner moved to reconsider but the same was
denied by the Appellate Court in its resolution dated September 26, 1986. 6
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 a forcible entry case against petitioner. 7
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
9
respondents before the Court of Appeals. Having heard both parties, the Appellate invoke the aid of the competent court, if the holder should refuse to deliver the
Court need not await or require any other additional pleading. Moreover, the fact thing."
that petitioner was heard by the Court of Appeals on its motion for reconsideration
negates any violation of due process. 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.
Notwithstanding petitioner's claim that it was duly authorized by the owners to
develop the subject property, private respondents, as actual possessors, can SO ORDERED.
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 involved. 8

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 be turned out by a strong hand, violence or terror. 9 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 person having a better right by accion
publiciana or accion reivindicatoria. 10

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 of the doctrine of self-help enunciated in Article 429 of the
New Civil Code. 11 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
10
G.R. No. 118284 July 5, 1996
SPOUSES MAMERTO REFUGIA and FELIZA PAYAD-REFUGIA, RODOLFO REFUGIA, and
CANDELARIA REFUGIA, petitioners,
vs.
COURT OF APPEALS and SPOUSES ARTURO REFUGIA and AURORA TIMBANG-REFUGIA,
respondents.
REGALADO, J.:p
This is an appeal by certiorari from the decision 1 of respondent Court of Appeals in
CA-G.R. No. 34647 promulgated on December 9, 1994 which reversed and set aside
the judgment 2 dated April 29, 1994 of the Regional Trial Court of Valenzuela, Branch
172, in Civil Case No. 4347-V-94 affirming with some modifications the decision 3
rendered by the Metropolitan Trial Court of Valenzuela, Branch 81, in Civil Case No.
6089 on March 4, 1994.
The records en bloc of the aforesaid cases show that private respondent-spouses
Arturo Refugia and Aurora Timbang-Refugia are the registered owners of a parcel of
land and a duplex apartment building constructed thereon located at No. 16
Meriales Street, Marulas, Valenzuela, as evidenced by Transfer Certificate of Title No.
218979. Apparently, said title was issued pursuant to a Deed of Absolute Sale
executed on September 11, 1975 in favor of respondent Arturo Refugia, but the
purchase price of P20,000.00 was reportedly advanced by his father, herein
petitioner Mamerto Refugia. Thereafter, respondent Arturo Refugia obtained a
housing loan from the Social Security System, using the land as collateral to secure
payment thereof. In 1976, after the construction of the duplex apartment building,
herein petitioners immediately began to occupy one door while respondents stayed
in the other unit.
It appears, however, that things did not turn out well between petitioners and
private respondents, especially between petitioner Feliza Refugia and her daughter-
in-law, Aurora, such that in February of 1993, petitioners were told by private
respondents to vacate the unit that they were occupying because, according to
private respondents, the family of one of their children who is married needed a
place of their own. Petitioners refused to leave, claiming that they own the unit they
are occupying by reason of the fact that it was actually Mamerto Refugia who bought
the lot on which the duplex apartment stood. Because of this, the matter was
brought before the barangay court of conciliation. No amicable settlement having
been reached between the parties, private respondents instituted an action for
ejectment on October 20, 1993 in the Metropolitan Trial Court of Valenzuela, Branch
81.
On March 4, 1994, the court a quo rendered judgment dismissing the complaint for
ejectment based on its finding that herein petitioners are the lawful occupants of the
premises. Thus, it held that:
Like in any other ejectment suit, the pivotal issue is whether the defendants are
unlawfully with(h)olding possession of the premises in question. The question that
perturbs the mind of the Court which is not fully explained by plaintiffs is whether
the stay of the defendants in the premises was indeed by plaintiffs' tolerance alone.
From the evidence on hand the Court is more disposed to believe the position of the
defendants that it was Mamerto who bought the lot where the duplex apartment
was constructed by plaintiff Arturo Refugia. As stated earlier, the amount of
P20,000.00 was withdrawn on September 11, 1975, the date the Deed of Absolute
Sale (Exhibits F and F-1) was executed. The consideration of the sale is for
P20,000.00. The fact that a two-door apartment was indeed constructed likewise
regenerates the claim of defendants that they shall be co-owners of the lot and shall
dwell in one of the doors of said apartment. If the averment of plaintiffs that they
exclusively own the property is not to be trusted — what have motivated them to
construct a two-door apartment instead of a single and a larger house? These facts
are small tributaries that lead us to the bigger lake of truth, that is, the stay of the
defendants in the premises is not on the basis of mere tolerance.
It may also be pointed out that the certification to file action (Exhibit E) issued by the
Barangay is for Land Dispute not for ejectment. (Emphasis ours) In the handwritten
transcripts of the proceedings in the barangay, it appears that this case is merely an
off-shoot of a misunderstanding between plaintiff Aurora Refugia and her in-laws. It
was admitted by Aurora that she offered to pay the a mount of P20,000.00 but that
the defendants refused to accept the same. Then and there plaintiff Aurora said that
she would prefer to sell the unit to another and that out of the proceeds of the sale,
she will pay the defendants. These circumstances lead the Court to conclude that it is
not true that plaintiffs' daughter is in need of the premises.
On appeal, the Regional Trial Court of Valenzuela, Branch 172, in its aforementioned
decision, affirmed with modification the judgment of the lower court by declaring
11
herein petitioners and private respondents co-owners of the lot and the two-door
apartment. Their motion for reconsideration having been denied, private
respondents duly filed a petition for review before respondent Court of Appeals.
On December 9, 1994, said respondent court rendered its questioned judgment
which reversed and set aside the aforestated decisions of the Metropolitan Trial
Court and the Regional Trial Court, and thereafter ordered petitioners and their
privies to vacate the subject premises and to surrender possession thereof to private
respondents. In so ruling, respondent court declared that the Regional Trial Court, in
the exercise of its appellate jurisdiction over an ejectment case, had no authority to
resolve the issue of ownership and to declare herein petitioners as co-owners
because its power is limited only to a determination of the issue of possession, that
petitioners' bare allegation of ownership cannot prevail over the transfer certificate
of title and deed of sale in favor of private respondents; and that petitioners have
been occupying the subject premises by mere tolerance.
Hence, this petition wherein petitioners aver that respondent Court of Appeals
erred: (a) in giving due course to respondents' appeal despite the fact that it was
filed beyond the fifteen (15) day reglementary period to appeal; (b) in disregarding
jurisprudence that factual findings of the trial court should not be disturbed on
appeal; (c) in holding that petitioners' claim of co-ownership of the subject premises
is a mere allegation unsupported by any concrete evidence; (d) in ruling that the
issue of ownership, as raised by petitioners, is foreign to the issue of possession in an
ejectment case; and (e) in reversing the decisions of both lower courts and ordering
petitioners' eviction from the disputed premises.
Anent the first issue, petitioners contend that private respondents received a copy of
the decision of the Regional Trial Court on May 4, 1994 and thus they had until May
19, 1994 within which to file a petition for review before the Court of Appeals.
However, private respondents filed instead a Motion for Reconsideration which was
denied by the Regional Trial Court in its Order dated June 21, 1994. Petitioners argue
that since the motion for reconsideration is a prohibited pleading under the Rule on
Summary Procedure and that the filing thereof did not interrupt the running of the
prescriptive period, the petition for review which was filed by private respondents
only on July 21, 1994 was already way beyond the 15-day reglementary period and
should not have been given due course by respondent court.
In the case of Jakihaca vs. Aquino, et al., 4 this Court categorically ruled that:
The Rule on Summary Procedure applies only in cases filed before the Metropolitan
Trial Court and Municipal Trial Courts, pursuant to Section 36 of Batas Pambansa Blg.
129. Summary procedures have no application to cases before the Regional Trial
Courts. Hence, when the respondents appealed the decision of the Municipal Trial
Court to the Regional Trial Court, the applicable rules are those of the latter court.
It is thus settled that a motion for reconsideration may be filed from a decision of the
Regional Trial Court in the exercise of its appellate jurisdiction over decisions of the
inferior courts in ejectment cases. Accordingly, this argument of petitioners has to be
rejected.
There is nonetheless appreciable merit in their contention that the petition for
review was belatedly filed in the Court of Appeals. This is because in case of a
judgment or final order of the Regional Trial Court rendered in an appeal from the
judgment or final order of an inferior court, the former may be appealed to the
Court of Appeals through a petition for review within fifteen days from receipt of
said judgment or final order. If a motion for reconsideration is filed, the losing party
has only the remaining period within which to file that petition for review. The filing,
therefore, of a motion for reconsideration has the effect of only suspending the
period to appeal. This rule has been clarified in the case of Lacsamana, et. al. vs. The
Honorable Second Special Cases Division of the Intermediate Appellate Court, et. al., 5
as follows:
3) APPEALS BY PETITION FOR REVIEW TO THE COURT OF APPEALS
The final judgment or order of a regional trial court in an appeal from the final
judgment or order of a metropolitan trial court, municipal trial court and municipal
circuit trial court, may be appealed to the Court of Appeals through a petition for
review in accordance with Section 22 of BP No. 129 and Section 22 (b) of the Interim
Rules, or to this Court through a petition for review on certiorari in accordance with
Rule 45 of the Rules of Court and Section 25 of the Interim Rules. The reason for
extending the period for the filing of a record on appeal is also applicable to the filing
of a petition for review with the Court of Appeals. The period for filing a petition for
review is fifteen days. If a motion for reconsideration is filed with and denied by a
regional trial court, the movant has only the remaining period within which to file a
petition for review. Hence, it may necessary to file a motion with the Court of Appeals
for extension of time to file such petition for review. (Emphasis supplied).
12
It is not disputed that private respondents received a copy of the decision of the
Regional Trial Court of Valenzuela on May 4, 1994, and that their motion for
reconsideration was filed with said court on the fifteenth day of the reglementary
period to appeal, that is, May 19, 1994. In such a case, the rule is that the aggrieved
party has only one day from receipt of the order denying the motion for
reconsideration within which to file a petition for review before the Court of
Appeals. 6 In the case at bar, private respondents received a copy of the order
denying their motion for reconsideration on July 6, 1994, and, without moving for
extension of time, were able to file their petition for review only on July 21, 1994;
hence their appeal was not seasonably perfected. Strictly speaking, therefore, the
appeal should not have been given due course, following the pronouncement in the
case of Miranda vs. Guanzon, et al. 7 to the effect that the requirement regarding the
perfection of an appeal within the reglementary period is not only mandatory but
jurisdictional.
This rule, however, has been relaxed in the latter case of Tijam, et al. vs.
Sibonghanoy, et al. 8 where it was held that a party, after voluntarily submitting a
cause, is estopped from attacking the jurisdiction of the court simply because it
thereafter obtained an adverse decision on the merits. The Court explained therein
that the "party is barred from such conduct not because the judgment or order of
the court is valid and conclusive as an adjudication, but for the reason that such a
practice cannot be tolerated — obviously for reasons of public policy." It will be
noted that the jurisdictional issue involved in the instant case was raised only for the
first time in the present petition for review on certiorari. The lack or absence of
appellate jurisdiction was never questioned by petitioners either in their Comment 9
submitted with respondent court or in their Motion to Dismiss Appeal 10 which was
grounded solely on the fact that the petition for review filed before said court was
not verified.
Despite several opportunities to raise the issue of jurisdiction in the Court of
Appeals, petitioners did not challenge its appellate jurisdiction and did so only after
an adverse decision was rendered against them. To be more precise, they raised the
issue of jurisdiction, for the nullification of the decision of the Court of Appeals,
when the case was already on appeal before this Court. They are now barred from
doing so under the doctrine of estoppel by laches. 11 Additionally, having participated
actively in the proceedings before the appellate court, petitioners can no longer
question its authority. 12
The main issue in this case demands the determination of whether the Metropolitan
Trial Court, as well as the Regional Trial Court in the exercise of its appellate
jurisdiction, have jurisdiction to resolve the issue of ownership in an action for
unlawful detainer where the issue of possession cannot be resolved without deciding
the question of ownership. In the affirmative, it becomes necessary to delineate the
extent and legal effect of such adjudication.
Under Republic Act No. 296, or the Judiciary Act of 1948, as amended, the
jurisdiction of the then municipal and city courts over actions for forcible entry and
unlawful detainer was defined as follows:
Sec. 88. Original jurisdiction in civil cases. — . . . In forcible entry and detainer
proceedings, the municipal judge or judge of the city court shall have original
jurisdiction, but the said municipal judge or city judge may receive evidence upon
the question of title therein, whatever may be the value of the property, solely for
the purpose of determining the character and extent of possession and damages for
detention. In forcible entry proceedings, he may grant preliminary injunctions, in
accordance with the provisions of the Rules of Court, to prevent the defendant from
committing further acts of dispossession against the plaintiff. (As amended by
Republic Acts Nos. 2613 and 3828).
The law was subsequently amended by Republic Act No. 5967 13 which vested in the
city courts special jurisdiction to resolve the issue of ownership in conjunction with
the issue of possession whenever the question of ownership is brought in issue by
the pleadings, thus:
Sec. 3. Besides the civil cases over which the City Courts have jurisdiction under
Section eighty-eight of Republic Act Numbered Two hundred ninety-six, as amended,
it shall likewise have concurrent jurisdiction with the Court of First Instance over the
following:
xxx xxx xxx
(c) In ejection cases where the question of ownership is brought in issue in the
pleadings. The issue of ownership shall therein be resolved in conjunction with the
issue of possession.
This special jurisdiction of city courts was differentiated from the power ordinary
accorded the inferior courts to receive evidence of title only for the purpose of
determining the character or extent of the possession in dispute. This Court had the
13
occasion to apply and interpret the aforequoted statutory provision in Pelaez vs.
Reyes, et al. 14 which raised the issue of whether a decision of a city court in an
ejectment case involving the question of ownership was appealable to the Regional
Trial Court or to the Court of Appeals, in this wise:
In the light of these provisions, petitioner insists that respondents should have
appealed to the Court of First Instance. Specifically, his contention is that the
inclusion of the issue of ownership in the pleadings did not change the character of
the proceeding as an action of unlawful detainer over which city and municipal
courts have original exclusive jurisdiction. He claims that his contention is supported
by the very provision of Section 3, just quoted, to the effect that when ownership is
brought in issue in the pleadings in an ejection case before the city courts, said
courts are to resolve the issue of ownership only "in conjunction with the issue of
possession." In other words, he posits that since the action is one of unlawful
detainer, the main issue to be settled by the city court remains to be possession, and
that to resolve the issue of ownership "in conjunction with the issue of possession" is
not the same as resolving it in a judicial litigation where it is the sole issue.
We are not impressed. Regardless of the juridical value of the significance petitioner
is trying to thus draw from the rather peculiar language of the statute, We are of the
considered opinion that the evident import of Section 3 above is to precisely grant to
the city courts concurrent original jurisdiction with the courts of first instance over
the cases enumerated therein, which include "ejection cases where the question of
ownership is brought in issue in the pleading." To sustain petitioner's contention
about the meaning of the last phrase of paragraph (c) of said section regarding the
resolution of the issue of ownership "in conjunction with the issue of possession" is
to disregard the very language of the main part of the section which denotes
unmistakably a conferment upon the city courts of concurrent jurisdiction with the
courts of first instance over ejection cases in which ownership is brought in issue in
the pleadings. It is to Us quite clear that the fact that the issue of ownership is to be
resolved "in conjunction with the issue of possession" simply means that both the
issues of possession and ownership are to be resolved by the city courts. And the
jurisdiction is concurrent with the Courts of First Instance precisely because usually
questions of title are supposed to be resolved by superior courts. In other words, this
grant of special jurisdiction to city courts is to be distinguished from the power
ordinarily accorded to municipal courts to receive evidence of title only for the
purpose of determining the extent of the possession in dispute.
It being clear, therefore, that in the main ejection case, . . . , the issue of ownership is
involved as shown by the pleadings therein filed by the parties, and that under
Section 3 of Republic Act 5967, said city court exercised original jurisdiction over the
same concurrently with the Court of First Instance of Misamis Oriental, the appeal of
respondents was rightly made by them to the Court of Appeals (Emphasis ours.)
However, on August 14, 1981, Batas Pambansa Blg. 129, or the Judiciary
Reorganization Act of 1980, was approved and it redefined the jurisdiction of the
Court of Appeals, the Regional Trial Courts and the inferior courts. Specifically, the
new law modified the power of inferior courts to resolve the issue of ownership in
forcible entry and unlawful detainer cases, subject, however, to the qualification that
a resolution thereof shall not be for the purpose of determining the issue of
possession, to wit:
Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and
Municipal Circuit Trial Courts in Civil Cases. — Metropolitan Trial Courts, Municipal
Trial Courts, and Municipal Circuit Trial Courts shall exercise.
xxx xxx xxx
(2) Exclusive original jurisdiction over cases of forcible entry and unlawful detainer:
Provided, That when in such cases, the defendant raises the question of ownership
in his pleadings and the question of possession cannot be resolved without deciding
the issue of ownership, the issue of ownership shall be resolved only to determine
the issue of possession.
Subsequently, this Court promulgated its Interim Rules and Guidelines in the
implementation of Batas Pambansa Blg. 129, Section 10 of which provides:
10. Jurisdiction in ejectment cases. — Metropolitan trial courts, municipal trial courts,
and municipal circuit trial courts, without distinction, may try cases of forcible entry
and detainer even if the question of ownership is raised in the pleadings and the
question of possession could not be resolved without deciding the issue of
ownership, but the question of ownership shall be resolved only to determine the
issue of possession.
These issuances changed the former rule under Republic Act No. 296 which merely
allowed inferior courts to receive evidence upon the question of title solely for the
purpose of determining the extent and character of possession and damages for
detention, which thereby resulted in previous rulings of this Court to the effect that
14
if it appears during the trial that the principal issue relates to the ownership of the
property in dispute and any question of possession which may be involved
necessarily depends upon the result of the inquiry into the title, then the jurisdiction
of the municipal or city courts is lost and the action should be dismissed. With the
enactment of Batas Pambansa Blg. 129, the inferior courts now retain jurisdiction
over an ejectment case even if the question of possession cannot be resolved
without passing upon the issue of ownership, with the express qualification that such
issue of ownership shall be resolved only for the purpose of determining the issue of
possession. In other words, the fact that the issues of ownership and possession de
facto are intricately interwoven will not cause the dismissal of the case for forcible
entry and unlawful detainer on jurisdictional grounds.
The intendment of the law was reinforced by the revision of the former Rule on
Summary Procedures involving special cases before the inferior courts, which was
promulgated pursuant to Section 36 of Batas Pambansa Blg. 129. The old Rule, which
took effect on August 1, 1983, stated that:
Sec. 1. Scope — This Rule shall govern the procedure in the Metropolitan Trial
Courts, the Municipal Trial Courts, and the Municipal Circuit Trial Courts in the
following cases:
A. Civil Cases
(1) Cases of forcible entry and unlawful detainer, except where the question of
ownership is involved, or where the damages or unpaid rentals sought to be
recovered by the plaintiff exceed twenty thousand pesos (P20,000.00) at the time of
the filing of the complaint.
This Rule was revised pursuant to a resolution of the Court En Banc which took effect
on November 15, 1991, and the aforequoted provision now reads as follows:
Sec. 1. Scope. — This rule shall govern the summary procedure in the Metropolitan
Trial Courts, the Municipal Trial Courts in Cities, the Municipal Trial Courts, and the
Municipal Circuit Trial Courts in the following cases falling within their jurisdiction:
A. Civil Cases
(1) All cases of forcible entry and unlawful detainer, irrespective of the amount of
damages or unpaid rentals sought to be recovered. Where attorney's fees are
awarded, the same shall not exceed twenty thousand pesos (P20,000.00).
Under the original Rule, ejectment cases were covered by the summary rules only
where the unpaid rentals do not exceed P20,000.00 and no question of ownership is
involved. As presently formulated, however, all ejectment cases are now
unqualifiedly covered by the summary procedure, which necessarily implies that
even if there is a need to resolve the issued of ownership, such fact will not deprive
the inferior courts of jurisdiction over these cases.
Subsequently, Republic Act No. 7691, entitled "An Act Expanding the Jurisdiction of
the Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial
Courts, Amending for the Purpose Batas Pambansa Blg. 129, otherwise known as the
'Judiciary Reorganization Act of 1980'", was passed and took effect on April 15, 1994.
15
The jurisdiction of the inferior courts over forcible entry and unlawful detainer
cases as defined under Batas Pambansa Blg. 129 was retained. In addition, they now
exercise limited original jurisdiction over civil actions involving title to, or possession
of, real property or any interest therein depending on the assessed value and
location of the property.
Parenthetically, it might be argued that since inferior courts are anyway vested with
jurisdiction over real actions, then it can very well resolve the issue of ownership
raised in the ejectment case, under the conditions stated in Section 32(3) of Batas
Pambansa Blg. 129, as amended by Republic Act No. 7691. It must not be
overlooked, however, that proceedings in ejectment cases are summary in nature,
whereas actions for recovery of ownership require a full-blown trial on the merits.
The difference in the procedure in special civil actions, like ejectment, and in
ordinary civil actions, such as accion reinvindicatoria, inveigh against the
consolidation of said cases or the joinder of the different causes of action involved. It
could also be violative under certain circumstances of the rule on permissive joinder
of causes of action since Section 6 of Rule 2 requires inter alia due observance of the
rules on jurisdiction and joinder of parties, and that said causes of action arise out of
the same contract, transaction or relation between the parties.
As the law on forcible entry and unlawful detainer cases now stands, even where the
defendant raises the question of ownership in his pleadings and the question of
possession cannot be resolved without deciding the issue of ownership, the
Metropolitan Trial Courts, Municipal Trial Courts, and Municipal Circuit Trial Courts
nevertheless have the undoubted competence to resolve the issue of ownership
albeit only to determine the issue of
16
possession.
15
On the bases of the foregoing disquisitions, it is clear that prior to the effectivity of
Batas Pambansa Blg. 129, the jurisdiction of inferior courts was confined to receiving
evidence of ownership in order to determine only the nature and extent of
possession, by reason of which such jurisdiction was lost the moment it became
apparent that the issue of possession was intricately interwoven with that of
ownership. The law, as revised, now provides instead that when the question of
possession cannot be resolved without deciding the issue of ownership, the issue of
ownership shall be resolved only to determine the issue of possession. On its face,
the new Rule on Summary Procedure was extended to include within the jurisdiction
of the inferior courts ejectment cases which likewise involve the issue of ownership.
This does not mean, however, that blanket authority to adjudicate the issue of
ownership in ejectment suits has been thus conferred on the inferior courts.
At the outset, it must here be stressed that the resolution of this particular issue
concerns and applies only to forcible entry and unlawful detainer cases where the
issue of possession is intimately intertwined with the issue of ownership. It finds no
proper application where it is otherwise, that is, where ownership is not in issue, or
where the principal and main issue raised in the allegations of the complaint as well
as the relief prayed for make out not a case for ejectment but one for recovery of
ownership.
In the case of De la Santa vs. Court of Appeals, et al., 17 this Court, in making a
distinction between the reception of evidence and the resolution of the issue of
ownership, held that the inferior court may look into the evidence of title or
ownership and possession de jure insofar as said evidence would indicate or
determine the nature of possession. It cannot, however, resolve the issue of
ownership, that is, by declaring who among the parties is the true and lawful owner
of the subject property, because the resolution of said issue would effect an
adjudication on ownership which is not sanctioned in the summary action for
unlawful detainer. With this as a premise and taking into consideration the
amendment introduced by Batas Pambansa Blg. 129, it may be suggested that
inferior courts are now conditionally vested with adjudicatory power over the issue
of title or ownership raised by the parties in an ejectment suit.
Withal, it will be observed, that the passage of Batas Pambansa Blg. 129 has
spawned seemingly conflicting jurisprudence on the proper interpretation and
application thereof. Thus, in several cases decided by the Court after the effectivity
of this law, regardless of whether the complaint for ejectment was filed with the
inferior court prior thereto or otherwise, it was held that the jurisdiction of the
inferior court is lost and the ejectment case should be dismissed where the issue of
possession cannot be resolved without determining the issue of ownership. 18 In all
of these cases, the Court declared that inferior courts may only admit evidence and
proof of ownership but they cannot adjudicate on the question of ownership.
Conversely, in also not a few instances, the jurisdiction of the inferior courts to
resolve the issue of ownership in order to determine the issue of possession was
upheld by this Court. 19 Apparently, it could have been some imprecision in language
or a misperception of the statutory text which generated the ostensible doctrinal
variance.
After due deliberation, we find and so hold that by virtue of the express mandate set
forth in Section 33(2) of Batas Pambansa Blg. 129, inferior courts have jurisdiction to
resolve the question of ownership raised as an incident in an ejectment case where a
determination thereof is necessary for a proper and complete adjudication of the
issue of possession. Certain guidelines, however, must be observed in the
implementation of this legislative prescription, viz.:
1. The primal rule is that the principal issue must be that of possession, and that
ownership is merely ancillary thereto, in which case the issue of ownership may be
resolved but only for the purpose of determining the issue of possession. Thus, as
earlier stated, the legal provision under consideration applies only where the inferior
court believes and the preponderance of evidence shows that a resolution of the
issue of possession is dependent upon the resolution of the question of ownership.
2. It must sufficiently appear from the allegations in the complaint that what the
plaintiff really and primarily seeks is the restoration of possession. 20 Consequently,
where the allegations of the complaint as well as the reliefs prayed for clearly
establish a case for the recovery of ownership, and not merely one for the recovery
of possession de facto, or where the averments plead the claim of material
possession as a mere elemental attribute of such claim for ownership, 21 or where
the issue of ownership is the principal question to be resolved, 22 the action is not
one for forcible entry but one for title to real property.
3. The inferior court cannot adjudicate on the nature of ownership where the
relationship of lessor and lessee has been sufficiently established in the ejectment
case, 23 unless it is sufficiently established that there has been a subsequent change
in or termination of that relationship between the parties. This is because under
Section 2(b), Rule 131 of the Rules of Court, the tenant is not permitted to deny the
16
title of his landlord at the time of the commencement of the relation of landlord and
tenant between them.
4. The rule in forcible entry cases, but not in those for unlawful detainer, is that a
party who can prove prior possession can recover such possession even against the
owner himself. Regardless of the actual condition of the title to the property and
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 person having a better right through an accion publiciana or
accion reivindicatoria. 24 Corollarily, if prior possession may be ascertained in some
other way, then the inferior court cannot dwell upon or intrude into the issue of
ownership.
5. Where the question of who has prior possession hinges on the question of who
the real owner of the disputed portion is, the inferior court may resolve the issue of
ownership and make a declaration as to who among the contending parties is the
real owner. 25 In the same vein, where the resolution of the issue of possession
hinges on a determination of the validity and interpretation of the document of title
or any other contract on which the claim of possession is premised, the inferior court
may likewise pass upon these issues. This is because, and it must be so understood,
that any such pronouncement made affecting ownership of the disputed portion is
to be regarded merely as provisional, hence, does not bar nor prejudice an action
between the same parties involving title to the land. 26 Moreover, Section 7, Rule 70
of the Rules of Court expressly provides that the judgment rendered in an action for
forcible entry or unlawful detainer shall be effective with respect to the possession
only and in no wise bind the title or affect the ownership of the land or building.
The interpretative rules we have herein adopted are not without justification. It is
our considered opinion that they are more in keeping with the avowed objective of
actions for forcible entry and unlawful detainer which have purposely been made
summary in nature so that there may be a peaceful, speedy and expeditious means
of preventing an alleged illegal possessor of property from unjustly continuing his
possession for a long time, thereby insuring the maintenance of peace and order in
the community, as, otherwise, the party illegally deprived of possession might feel
the despair of long waiting and decide, as a measure of self-protection, to take the
law into his hands and seize the same by force and violence. 27 And since the law
discourages continued wrangling over possession of property for they involve
perturbation of social disorder which must be restored as promptly as possible,
technicalities or details of procedure which may cause unnecessary delays should
accordingly and carefully be avoided. 28
As a matter of judicial experience, there have been cases where persons who have
failed to adduce any legal ground for their continued stay on property belonging to
another have nonetheless managed to stave off eviction for several years through
the improper use of procedural technicalities. 29 Conformably, if we were to allow
the dismissal of an ejectment case for the reason that the question of ownership is
incidentally involved in determining the question of possession, we are in effect
providing the defendants in ejectment cases with the opportunity to prolong their
occupancy of premises, over which they have ceased to have any valid possessory
right, during the time that an action for recovery of ownership, which involves a
more tedious and lengthy court proceeding, is actually pending in court.
It is indeed ironic that a forcible entry or unlawful detainer case which is intended to
be disposed of in summary fashion has oftentimes proved to be the most
cumbersome and difficult to decide. It is thus about time that this situation be
remedied if only to contribute to the solution of the worsening problem of court
congestion, by refusing to edify these cases by giving them a full-blown treatment in
all the courts in the judicial structure, and thereby save the courts the expenditure of
precious time and energy which could otherwise be devoted to more significant and
vital litigations. 30
With these considerations in mind, we now proceed to the merits of the present
case. Petitioners claim to be co-owners of the subject premises on the basis of an
alleged verbal agreement between the parties to subdivide the property, as well as
the payment made by petitioner Mamerto Refugia for the purchase of the lot in the
amount of P20,000.00. On the other hand, private respondents' property rights are
supported by sufficient documents and muniments of ownership, namely, the deed
of absolute sale, transfer certificate of title, and building permit in their names, the
regularity in the issuance of which was never controverted nor put in issue by
petitioners.
The Metropolitan Trial Court and the Regional Trial Court are not in accord on
whether to treat the P20,000.00 as a loan or as payment for petitioners' share in the
subject premises, while respondent Court of Appeals believes that the same is
actually a loan. It bears significant notice that petitioners never refuted nor denied,
in any of their pleadings filed in this case from the court of origin and all the way up
to this Court, the allegation that private respondents gave P5,000.00 as partial
17
payment for the loan. No countervailing explanation was advanced by petitioners lessee or tenant whose term of lease has expired but whose occupancy continued by
why such payment was made to and accepted by them as such. tolerance of the owner. 36

Furthermore, the allegation of petitioners that there was a verbal agreement to
subdivide the property between them and private respondents is self-serving and
evidentiarily baseless at this stage. In addition, their theory of an "implied trust" was
not raised in issue in the trial court and cannot therefore be raised for the first time
in the present petition. 31 At most, it was merely alluded to in petitioners' Rejoinder
filed with the Court of Appeals, but petitioners never bothered to expound on or
substantiate the same. Consequently, it cannot now be raised as an assignment of
error in the present petition.
In sum, and as held by respondent court, the Regional Trial Court "overstepped its
bounds" in ruling that petitioners and private respondents are co-owners of the
property, which issue should be finally determined in the separate action for specific
performance reportedly pending between the parties. At this juncture, however, the
evidence conduces to a finding that private respondents are in possession of the
premises in the concept of and consequent to their being owners thereof. Even on
such prima facie showing, therefore, private respondents can maintain the
ejectment case involved.
It has further been held that such tolerance must be present right from the start of
possession sought to be recovered, to categorize a cause of action as one of unlawful
detainer. 3 7 Here, it cannot be gainsaid that petitioners' possession was by mere
tolerance of private respondents from the very beginning. At any rate, it has likewise
not been denied by herein petitioners that one of their sons also owns a residential
house where they can live.
Notwithstanding the jurisdiction of the Regional Trial Court, and the Metropolitan
Trial Court for the matter, to qualifiedly resolve the issue of ownership raised in the
present ejectment suit, but their findings thereon being devoid of basis in fact and in
law, respondent Court of Appeals was fully justified in decreeing a reversal of their
judgments.
WHEREFORE, the judgment appealed from is hereby AFFIRMED in toto.
SO ORDERED.

While it may be argued that petitioners were able to prove prior possession, such,
however, is not the issue involved in this action for unlawful detainer. An action for
unlawful detainer is different from a forcible entry case in that the former involves
an act of unlawfully withholding the possession of the land or building against or
from a landlord, vendor or vendee or other person after the expiration or
termination of the detainer's right to hold possession by virtue of a contract, express
or implied, 32 and neither is prior physical possession of the property by the plaintiff
necessary; 33 whereas in the latter, the main issue is one of priority of possession. 34

In the case at bar, petitioners failed to show that they were legally entitled to
continue occupying the unit in question. On the considerations hereinbefore
detailed, we agree with the position of respondent Court of Appeals that petitioners
would in effect be occupying the premises by mere tolerance. A person who
occupies the land of another at the latter's tolerance or permission, without any
contract between them, is necessarily bound by an implied promise that he will
vacate the same upon demand, failing which a summary action for ejectment is the
proper remedy against him. 35 The status of petitioners is analogous to that of a

18
FIRST DIVISION
[G.R. No. 102693. September 23, 1992.]
SPOUSES AGOSTO MUÑOZ AND ROSARIO MUÑOZ, SPS. JESSIE (JESUS) CAGUIOA AND
EMMA FUMAR, SPS. RICARDO LOPEZ AND APOLONIA FABIAN, ZACARIA MARCELINO,
MR. CRISANTO CLARIN, MR. HONORIO YUMUL, MR. EDUARDO YUMUL, MRS. VICTORIA
CAYANAN, MR. ALEXANDER FABIAN AND MR. DIOSDADO SANTOS, Petitioner, v. THE
HON. COURT OF APPEALS AND NICOLAS P. GARCIA, Respondents.
Public Attorney’s Office, for Petitioners.
Jose P. Bondoc for Private Respondent.
SYLLABUS
1. REMEDIAL LAW; SPECIAL CIVIL ACTION; FORCIBLE ENTRY; DISTINGUISHED FROM
UNLAWFUL DETAINER. — The summary actions for unlawful detainer and forcible
entry may be distinguished from each other, as follows: "a. In forcible entry, the
possession of the land by the defendant is unlawful from the beginning as he
acquires possession thereof by force, intimidation, threat, strategy or stealth; while
in unlawful detainer, the possession of the defendant is inceptively lawful but it
becomes illegal by reason of the termination of his right to the possession of the
property under his contract with the plaintiff (Dikit v. Icasiano, 89 Phil. 44). "b. In
forcible entry, the law does not require a previous demand for the defendant to
vacate the premises; but in unlawful detainer, the plaintiff must first make such
demand, which is jurisdictional in nature (Sec. 2; Medel v. Militante, 41 Phil. 44). "c).
In forcible entry, the plaintiff must prove that he was in prior physical possession of
the premises until he was deprived thereof by the defendant; in unlawful detainer,
the plaintiff need not have been in prior physical possession (Maddamu v. Judge, 74
Phil. 230; Aguilar v. Cabrera, 74 Phil. 666; Banayos v. Susana Realty, Inc., L-30336,
June 30, 1976; Pharma Industries, Inc. v. Pajarillaga, Et Al., L-53788, Oct. 17, 1980).
"d. In forcible entry, the one-year period is generally counted from the date of actual
entry on the land; in unlawful detainer, from the date of last demand (Sarona, Et. Al.
v. Villegas, Et Al., L-22984, Mar. 27, 1968) or last letter of demand (DBP v. Canonoy,
L-29422, Sept. 30, 1970; Calibayan v. Pascual, L-22645, Sept. 18, 1967; Racaza v.
Susana Realty, Inc., L-20330, Dec. 22, 1966). (Regalado, Florenz D., Remedial Law
Compendium, Vol. 1, 5th Revised Edition, pp. 503-504)
2. ID.; ID.; ID.; MATTERS TO BE RESOLVED IN THE ACTION THEREFOR; RULE. — The
questions to be resolved in an action for forcible entry are: First, who had actual
possession over the piece of real property? Second, was the possessor ousted
therefrom within one year from the filing of the complaint by force, threat, strategy
or stealth? And lastly, does the plaintiff ask for the restoration of his possession?
(Dizon v. Concina, Et Al., G.R. No. L-23756, December 27, 1969).
3. ID.; ID.; ID.; EFFECTS OF FAILURE TO ALLEGE THE TIME WHEN UNLAWFUL
DEPRIVATION TOOK PLACE. — There was no mention in the complaint nor in the
position paper of the private respondent that he or his co-owners were in prior
possession of the property. There was an allegation that the property "is presently
tenanted" but it did not state when the tenant started to possess the property.
While it is true that possession of the tenant is possession of the owner, the
complaint failed to state that Loreta Garcia was in prior possession of the property at
the time of entry by the petitioners. And, while the complaint stated that the
petitioners obtained possession of the premises through stealth, it failed to aver
when this entry was accomplished or when the private respondent learned of such
entry. The failure of the private respondent to allege the time when unlawful
deprivation took place is fatal because this will determine the start of the counting of
the one year period for the filing of the summary action of forcible entry. When the
complaint fails to aver facts constitutive of forcible entry or unlawful detainer, as
where it does not state how entry was effected or how and when dispossession
started, the action should either be accion publiciana or reinvindicatoria in the Court
of First Instance (nor Regional Trial Court) (Sarona Et. Al. v. Villegas, Et Al., supra).
4. ID.; ID.; ID.; CANNOT BE CONVERTED TO UNLAWFUL DETAINER BY THE FACT THAT
A DEMAND WAS MADE TO VACATE THE SUBJECT PREMISE. — The respondent
appellate court erred in holding that this case is one for unlawful detainer. It failed to
consider the basic distinction that in forcible entry, possession is illegal at the
inception while in unlawful detainer, possession is legal until demand is made to
recover such possession or until the possessor does or fails to do an act which makes
his continued possession of the premises illegal. The fact that a demand was made
by the private respondent for the petitioners to vacate the subject premises cannot
change the nature of the latter’s possession of the property and convert the former’s
action from forcible entry to one for unlawful detainer. The respondent appellate
court likewise erred in applying in this case the doctrine that — "a person who
occupies the land of another at the latter’s tolerance or permission, without any
19
contract between them, is necessarily bound by the implied promise that he will
vacate upon demand, failing which, a summary action for ejectment is proper
remedy against them" — because, as We have said here, the possession by
defendants was illegal at the inception as alleged in the complaint, hence, there was
no tolerance.
5. ID.; ID.; ID.; NOT A PROPER ACTION TO CLAIM OWNERSHIP. — If the private
respondent is indeed the owner of the premises and that possession thereof was
deprived from him for more than twelve years, he should present his claim before
the Regional Trial Court in an accion publiciana or an accion reinvindicatoria and not
before the Municipal Trial Court in a summary proceeding of unlawful detainer or
forcible entry. For even if he is the owner, possession of the property cannot be
wrested from another who had been in possession thereof for more than twelve (12)
years through a summary action for ejectment. "Although admittedly petitioner may
validly claim ownership based on the muniments of title it presented, such evidence
does not responsibly address the issue of prior actual possession raised in a forcible
entry case. It must be stated that regardless of actual condition of the title to the
property, the party in peaceable quiet possession shall not 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 person having
a better right by accion publiciana or accion reinvindicatoria. (German Management
and Services Inc. v. CA, 76216-17, September 14, 1988, 177 SCRA 495, 499)
DECISION
MEDIALDEA, J.:
This case has its origin from a complaint 1 for unlawful detainer filed by Nicolas P.
Garcia (herein respondent) on August 15, 1988 before the Municipal Circuit Trial
Court, Masantol-Macabebe, Masantol, Pampanga. The complainant alleged that he is
a co-owner of an agricultural land identified as Lot No. 2790 of Subdivision Plan, Cad.
378-D, Macabebe, Cadastre, situated in the Barrio of Caduang Tete (Saplad David) of
the same municipality; that he and his co-owners acquired the lot by succession
from their deceased father, Pedro B. Garcia who died on April 6, 1939; that the said
lot is tenanted by Loreto Garcia; that the defendants (herein petitioners) constructed
their houses on a portion of the lot without the knowledge and consent of the
owners; that he sent letters of demand on June 6, 1988 asking the defendants to
remove their houses from the lot within fifteen (15) days from receipt of the letters
and that despite the demands made by him, the defendants refused to vacate their
houses (pp. 21-22, CA Records).
In their answer, (pp. 44-47, CA Records), the defendants denied the allegations of
Nicolas Garcia and alleged that the tenant, Loreto Garcia is already deemed the
owner of the land pursuant to P.D. 27. The answering defendants also invoked the
following alternative defenses, among others: (1) lack of jurisdiction on the part of
the Municipal Trial Court, the case being an accion publiciana which is exclusively
cognizable by the Regional Trial Court; (2) no prior conciliation before the Lupong
Tagapayapa; (3) misjoinder of parties since defendants occupy lots distinct from each
other; (4) that the differently lots they are occupying form part of the shore of a
navigable river and partly the shoulder of a public road, hence, of public ownership;
(5) that they are farmworkers of the lot, and are entitled to security of tenure on the
land pursuant to Section 6 of RA 6657 and that they had erected their houses and
had continuously resided on the premises in issue since 1976 or for a period of
twelve years before the filing of the complaint.chanrobles virtual lawlibrary
After the issues had been joined, the Municipal Circuit Trial Court heard the case
under the Rules on Summary Procedure and decided the case on the basis of the
position papers of the parties.
On December 7, 1988, the municipal court rendered a decision in favor of the
plaintiff Nicolas Garcia, the dispositive portion of which states:jgc:chanrobles.com.ph
"WHEREFORE, judgment is hereby rendered, ordering:chanrob1es virtual 1aw library
1) The defendants and all persons claiming rights under them to remove their houses
from Lot 2790 of Subdivision Plan Cad. 378-D, Macabebe Cadastre, situated at
Saplad David, Caduang Tete, Macabebe, Pampanga; and to surrender the possession
of the same to the plaintiff;
2) Every defendant to pay to the plaintiff the sum of Five Thousand Pesos
(P5,000.00) attorney’s fees; and
3) Every defendants to pay One Hundred Pesos (P100.00) reasonable monthly rental
of the land occupied by said defendants from the filing of the complaint on August
15, 1988 up to the time the possession of the land occupied by said defendants is
20
vacated plus the costs." (pp. 72-73, CA Records).
Hence, this petition.
The Municipal Circuit Trial Court found that the plaintiff is one of the co-owners of
Lot 2790 of Subdivision Plan Cad. 378-D of Macabebe Cadastre, consisting of five (5) The principal question for resolution in this petition is whether or not the complaint
hectares. As such, he had every right to exercise his rights as owner and possessor of filed by the private respondent before the Municipal Circuit Trial Court was for the
the property and to demand the removal of defendants’ houses. The Municipal summary proceeding of forcible entry or unlawful detainer or an accion publiciana.
Court added that while the defendants assert that the premises is of public In the latter case, the Regional Trial Court and not the Municipal Trial Court has the
ownership considering that their houses occupy a part of a shore of a navigable river exclusive jurisdiction to hear and try the complaint.chanrobles virtualawlibrary
and part of the shoulder of the public road, this assertion runs counter to the very chanrobles.com:chanrobles.com.ph
claim of defendants that they are farmhands in the landholding for more than 12
years. Finally, the Municipal Court also held that since the issue involved in the case The petitioner is of the view that with the following allegations in the complaint, to
is mere possession and the defendants did not claim ownership, therefore, unlawful wit:jgc:chanrobles.com.ph
detainer is the proper action for plaintiff’s recovery of possession.
"2. That the plaintiff is a co-owner of an agricultural land located at Saplad, David,
The defendants appealed to the Regional Trial Court which reversed the decision of Macabebe, Pampanga identified as lot no. 2790, of the Subdivision Plan, Cad. 378-D,
the municipal court and dismissed the complaint. The Regional Trial Court held Macabebe, Cadastre, . . .;
that:cralawnad
"x x x.
"From all the foregoing consideration, the Court finds that plaintiff-appellee fails to
establish his proof of prior physical possession over the land subject matter of this "4. That the aforesaid agricultural land is presently tenanted by one farmer in the
case where the respective houses of the defendants-appellants were erected, name of Loreto Garcia with an area of more than five (5) hectares;
considering that the case at bar only deals with possession de facto and not
possession de jure. The Court also believes that the subject matter of this Court is "5. That the defendants have constructed their houses on a portion of the said lot
beyond the jurisdiction of the Municipal Circuit Trial Court. no. 2790 without the knowledge and consent of his co-owners;

"WHEREFORE, premises considered, the decision of the Municipal Circuit Trial Court "6. That the plaintiff has sent the defendants demand letters dated June 6, 1988
of Macabebe, Masantol-Macabebe, Pampanga is hereby reversed. The said case is asking said defendants to remove their houses from the said lot within a period of
dismissed with costs against the plaintiff." (p. 82, CA Records) fifteen (15) days from their receipt of said letters, . . ." (pp. 21-22, Records).

On June 27, 1989, Nicolas Garcia filed a motion for reconsideration of the Regional the complaint which the private respondent filed before the municipal court was an
Trial Court’s decision. The reconsideration sought was denied by order of the same accion publiciana and not one for unlawful detainer as he had captioned it. An accion
court dated October 11, 1989. publiciana is exclusively cognizable by the Regional Trial Court and not by the
Municipal Court.
Nicolas Garcia filed a petition for review with the Court of Appeals which rendered a
decision on August 6, 1991 in CA-G.R. SP No. 19154 reversing and setting aside the For his part, the private respondent alleged that the action which he filed before the
decision of the Regional Trial Court and reinstating the decision of the Municipal municipal court was an action for unlawful detainer. The demand to vacate dated
Circuit Trial Court. The reconsideration sought by the defendants before the June 6, 1988 which was served upon the petitioners was well within the one (1) year
appellate court was denied on November 11, 1991. period required by the rules for the filing of the summary action for unlawful
21
detainer the jurisdiction of which belongs to the municipal trial court.
The summary actions for unlawful detainer and forcible entry may be distinguished
from each other, as follows:jgc:chanrobles.com.ph
"4. . . . (Dizon v. Concina, Et Al., G.R. No. L-23756, December 27, 1969).
"a. In forcible entry, the possession of the land by the defendant is unlawful from the
beginning as he acquires possession thereof by force, intimidation, threat, strategy
or stealth: while in unlawful detainer, the possession of the defendant is inceptively
lawful but it becomes illegal by reason of the termination of his right to the
possession of the property under his contract with the plaintiff (Dikit v. Icasiano, 89
Phil. 44).
"b. In forcible entry, the law does not require a previous demand for the defendant
to vacate the premises; but in unlawful detainer, the plaintiff must first make such
demand, which is jurisdictional in nature (Sec. 2; Medel v. Militante, 41 Phil. 44).
"c. In forcible entry, the plaintiff must prove that he was in prior physical possession
of the premises until he was deprived thereof by the defendant; in unlawful
detainer, the plaintiff need not have been in prior physical possession (Maddamu v.
Judge, 74 Phil. 230: Aguilar v. Cabrera, 74 Phil. 666; Banayos v. Susana Realty, Inc. L-
30336, June 30, 1976: Pharma Industries, Inc. v. Pajarillaga, Et. Al. L-53788, Oct. 17,
1980).
"d. In forcible entry, the one-year period is generally counted from the date of actual
entry on the land; in unlawful detainer, from the date of last demand (Sarona, Et. Al.
v. Villegas, Et Al., L-22984, Mar. 27, 1968) or last letter of demand (DBP v. Canonoy,
L-29422, Sept. 30, 1970; Calibayan v. Pascual, L-22645, Sept. 18, 1967; Racaza v.
Susana Realty, Inc., L-20330, Dec. 22, 1966). (Regalado, Florenz D., Remedial Law
Compendium, Vol. 1, 5th Revised Edition, pp. 503-504)
The complaint subject of this case was captioned as "unlawful detainer." However,
the private respondent alleged therein that from the start, the possession of the
petitioner was unlawful as it was stated that the defendants have constructed their
houses on the questioned premises stealthily, that is, without the knowledge and
consent of his co-owners. This allegation clearly characterized the complaint as one
for forcible entry and not for unlawful detainer.chanrobles.com : virtual law library
The questions to be resolved in an action for forcible entry are: First, who had actual
possession over the piece of real property? Second, was the possessor ousted
therefrom within one year from the filing of the complaint by force, threat, strategy
or stealth? And lastly, does the plaintiff ask for the restoration of his possession?
There was no mention in the complaint nor in the position paper of the private
respondent that he or his co-owners were in prior possession of the property. There
was an allegation that the property "is presently tenanted" but did not state when
the tenant started to possess the property. While it is true that possession of the
tenant is possession of the owner, the complaint failed to state that Loreta Garcia
was in prior possession of the property at the time of entry by the petitioners. And,
while the complaint stated that the petitioners obtained possession of the premises
through stealth, it failed to aver when this entry was accomplished or when the
private respondent learned of such entry. The failure of the private respondent to
allege the time when unlawful deprivation took place is fatal because this will
determine the start of the counting of the one year period for the filing of the
summary action of forcible entry. When the complaint fails to aver facts constitutive
of forcible entry or unlawful detainer, as where it does not state how entry was
effected or how and when dispossession started, the action should either be accion
publiciana or reinvindicatoria in the Court of First Instance (now Regional Trial Court)
(Sarona Et. Al., v. Villegas, Et Al., supra).
The respondent appellate court erred in holding that this case is one for unlawful
detainer. It failed to consider the basic distinction that in forcible entry, possession is
illegal at the inception while in unlawful detainer, possession is legal until demand is
made to recover such possession or until the possessor does or fails to do an act
which makes his continued possession of the premises illegal. The fact that a
demand was made by the private respondent for the petitioners to vacate the
subject premises cannot change the nature of the latter’s possession of the property
and convert the former’s action from forcible entry to one for unlawful detainer. The
respondent appellate court likewise erred in applying in this case the doctrine that —
"a person who occupies the land of another at the latter’s tolerance or permission,
without any contract between them, is necessarily bound by the implied promise
that he will vacate upon demand, failing which, a summary action for ejectment is
proper remedy against them" — because, as We have said here, the possession by
defendants was illegal at the inception as alleged in the complaint, hence, there was
22
no tolerance. As explained in Sarona v. Villegas, G.R. No. L-22984, March 27, 1968,
22 SCRA 1257:chanrobles virtual lawlibrary
"But will this rule as to tolerance hold true in a case where there was forcible entry
at the start, but the lawful possessor did not attempt to oust the intruder for over
one year, and only thereafter filed forcible entry suit following demand to vacate?
"x x x.
"A close assessment of the law and the concept of the word ‘tolerance’ confirms our
view heretofore expressed that such tolerance must be present right from the start
of possession sought to be recovered, to categorize a cause of action as one of
unlawful detainer — not of forcible entry. Indeed, to hold otherwise would espouse
a dangerous doctrine. And for two reasons. First. Forcible entry into the land is an
open challenge to the right of the possessor. Violation of that right authorizes the
speedy redress — in the inferior court — provided for in the rules. If one year from
the forcible entry is allowed to lapse before suit is filed, then the remedy ceases to
be speedy; and the possessor is deemed to have waived his right to seek relief in the
inferior court. Second, if a forcible entry action in the inferior court is allowed after
the lapse of a number of years, then the result may well be that no action for forcible
entry can really prescribe. No matter how long such defendant is in physical
possession, plaintiff will merely make a demand, bring suit in the inferior court —
upon a plea of tolerance to prevent prescription to set in — and summarily throw
him out of the land. Such a conclusion is unreasonable. Especially if we bear in mind
the postulates that proceedings of forcible entry and unlawful detainer are summary
in nature, and that the one year time bar to suit is but in pursuance of the summary
nature of the action.
"It is well to remember that after the lapse of the one year period, suit must be
started in the Court of First Instance in an accion publiciana.
It is also the contention of petitioners that private respondents’ claim of ownership
had no basis. He should have at least, introduced muniments of title to show the
extent and character of his possession. Moreover, mere allegations of ownership
does not ipso facto entitle a person to possession of the property claimed.
The main issue in an action for forcible entry and detainer is one of priority of
possession. If the plaintiff can prove prior possession in himself, he may recover such
possession even from the owner. This rule however has no application in this case. It
is true that the private respondent in this case claimed that he is one of the co-
owners of the lot in question. However, he has not presented any evidence in
support of such claim of ownership by virtue of which he is entitled to its possession.
Moreover, he had not shown nor claimed in his complaint that he was in prior
possession of the property. On the contrary, it is the petitioners who claimed
possession of the property for more than twelve years.
If the private respondent is indeed the owner of the premises and that possession
thereof was deprived from him for more than twelve years, he should present his
claim before the Regional Trial Court in an accion publiciana or an accion
reinvindicatoria and not before the Municipal Trial Court in a summary proceeding of
unlawful detainer or forcible entry. For even if he is the owners possession of the
property cannot be wrested from another who had been in possession thereof for
more than twelve (12) years through a summary action for ejectment.
"Although admittedly petitioner may validly claim ownership based on the
muniments of title it presented, such evidence does not responsibly address the
issue of prior actual possession raised in a forcible entry case. It must be stated that
regardless of actual condition of the title to the property, the party in peaceable
quiet possession shall not 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 person having a better right by accion
publiciana or accion reinvindicatoria. (German Management and Services Inc. v. CA,
76216-17, September 14, 1988, 177 SCRA 495, 499).
ACCORDINGLY, the petition is GRANTED. The decision of the Court of Appeals is SET
ASIDE and the decision of the Regional Trial Court of Macabebe, Pampanga is
REINSTATED.
SO ORDERED.
23
G.R. No. 169793 September 15, 2006 was docketed as CV-01-030. In his Answer, respondent alleged that he has been in
actual possession and occupation of a portion of the subject land since 1968 and that
VICTORIANO M. ENCARNACION, petitioner, the issuance of Free Patent and titles in the name of petitioner was tainted with
vs. irregularities.7
NIEVES AMIGO, respondent.
On October 24, 2001, the Municipal Trial Court in Cities rendered judgment, which
DECISION reads:

YNARES-SANTIAGO, J.: WHERE[FO]RE, there being a preponderance of evidence, a JUDGMENT is hereby

rendered in favor of the plaintiff VICTORIANO M. ENCARNACION and against the
This petition for review assails the June 30, 2005 Decision1 of the Court of Appeals in
defendant NIEVES AMIGOE (sic) as follows:
CA-G.R. SP No. 73857, ordering the remand of Civil Case No. Br. 20-1194 to the
Regional Trial Court of Cauayan, Isabela, Branch 20, for further proceedings. a) ORDERING the defendant to vacate the portion of the parcels of land described in
Transfer Certificates of Title Nos. T-256650 and T-256651 he is now occupying and
The antecedent facts are as follows:
surrender it to the plaintiff;
Petitioner Victoriano M. Encarnacion is the registered owner of Lot No. 2121-B-1,
b) ORDERING the defendant to pay the plaintiff the sum of FIVE THOUSAND PESOS
consisting of 100 square meters and covered by TCT No. T-256650; and Lot No.
(P5,000) as attorney's fees, and
2121-B-2 consisting of 607 square meters with TCT No. T-256651, located at District
1, National Hi-way, Cauayan, Isabela. Said two lots originally form part of Lot No. c) ORDERING the defendant to pay rentals equivalent [to] P500.00 per month from
2121, a single 707 square meter track of land owned by Rogelio Valiente who sold February, 2001 until the portion of the land occupied by him is surrendered to the
the same to Nicasio Mallapitan on January 18, 1982. On March 21, 1985, Mallapitan plaintiff.
sold the land to Victoriano Magpantay. After the death of the latter in 1992, his
widow, Anita N. Magpantay executed an Affidavit of Waiver 2 on April 11, 1995 COSTS against the defendant.
waving her right over the property in favor of her son-in-law, herein petitioner,
Victoriano Encarnacion. Thereafter, the latter caused the subdivision of the land into SO ORDERED.8
two lots3 and the issuance of titles in his name on July 18, 1996.4
On appeal, the Regional Trial Court of Cauayan, Isabela, Branch 20, ruled as follows:
Respondent Nieves Amigo allegedly entered the premises and took possession of a
WHEREFORE, judgment is hereby rendered dismissing the case on the ground that as
portion of the property sometime in 1985 without the permission of the then owner,
the Municipal Court had no jurisdiction over the case, this Court acquired no
Victoriano Magpantay. Said occupation by respondent continued even after TCT Nos.
appellate jurisdiction thereof. Costs against plaintiff-appellee.
T-256650 and T-256651 were issue to petitioner.
SO ORDERED.9
Consequently, petitioner, through his lawyer sent a letter 5 dated Febuary 1, 2001
demanding that the respondent vacate the subject property. As evidenced by the Aggrieved, petitioner filed a petition for review10 under Rule 42 of the Rules of Court
registry return receipt, the demand letter was delivered by registered mail to the before the Court of Appeals which promulgated the assailed Decision remanding the
respondent on February 12, 2001. Notwithstanding receipt of the demand letter, case to the Regional Trial Court. The dispositive portion thereof reads:
respondent still refused to vacate the subject property. Thereafter, on March 2,
2001, petitioner filed a complaint6 for ejectment, damages with injunction and WHEREFORE, premises considered, this case is hereby REMANDED to Branch 20,
prayer for restraining order with the Municipal Trial Court in Cities of Isabela which Regional Trial Court of Cauayan, Isabela for further proceedings.

24
No costs.
SO ORDERED.11
Hence the present petition raising the sole issue:
[WHETHER] THE COURT OF APPEALS ERRED IN HOLDING THAT THE PROPER ACTION
IN THIS CASE IS ACCION PUBLICIANA AND NOT UNLAWFUL DETAINER AS
DETERMINED BY THE ALLEGATIONS IN THE COMPLAINT FILED BY PETITIONER. 12
The petition lacks merit.
In this jurisdiction, the three kinds of actions for the recovery of possession of real
property are:
1. Accion interdictal, or an ejectment proceeding which may be either that for
forcible entry (detentacion) or unlawful detainer (desahucio), which is a summary
action for recovery of physical possession where the dispossession has not lasted for
more than one year, and should be brought in the proper inferior court;
2. Accion publiciana or the plenary action for the recovery of the real right of
possession, which should be brought in the proper Regional Trial Court when the
dispossession has lasted for more than one year; and
3. Accion reinvindicatoria or accion de reivindicacion, which is an action for the
recovery of ownership which must be brought in the proper Regional Trial Court.13
Based on the foregoing distinctions, the material element that determines the
proper action to be filed for the recovery of the possession of the property in this
case is the length of time of dispossession. Under the Rules of Court, the remedies of
forcible entry and unlawful detainer are granted to a person deprived of the
possession of any land or building by force, intimidation, threat, strategy, or stealth,
or a lessor, vendor, vendee, or other person against whom the possession of any
land or building is unlawfully withheld after the expiration or termination of the right
to hold possession by virtue of any contract, express or implied, or the legal
representatives or assigns of any such lessor, vendor, vendee, or other person. These
remedies afford the person deprived of the possession to file at any time within one
year after such unlawful deprivation or withholding of possession, an action in the
proper Municipal Trial Court against the person or persons unlawfully withholding or
depriving of possession, or any person or persons claiming under them, for the
restitution of such possession, together with damages and costs.14 Thus, if the
dispossession has not lasted for more than one year, an ejectment proceeding is
proper and the inferior court acquires jurisdiction. On the other hand, if the
dispossession lasted for more than one year, the proper action to be filed is an
accion publiciana which should be brought to the proper Regional Trial Court.
After a careful evaluation of the evidence on record of this case, we find that the
Court of Appeals committed no reversible error in holding that the proper action in
this case is accion publiciana; and in ordering the remand of the case to the Regional
Trial Court of Cauayan, Isabela, Branch 20, for further proceedings.
Well settled is the rule that jurisdiction of the court over the subject matter of the
action is determined by the allegations of the complaint at the time of its filing,
irrespective of whether or not the plaintiff is entitled to recover upon all or some of
the claims asserted therein. What determines the jurisdiction of the court is the
nature of the action pleaded as appearing from the allegations in the complaint. The
averments therein and the character of the relief sought are the ones to be
consulted.15 On its face, the complaint must show enough ground for the court to
assume jurisdiction without resort to parol testimony.16
From the allegations in the complaint, it appears that the petitioner became the
owner of the property on April 11, 1995 by virtue of the waiver of rights executed by
his mother-in-law. He filed the complaint for ejectment on March 2, 2001 after his
February 1, 2001 letter to the respondent demanding that the latter vacate the
premises remained unheeded. While it is true that the demand letter was received
by the respondent on February 12, 2001, thereby making the filing of the complaint
for ejectment fall within the requisite one year from last demand for complaints for
unlawful detainer, it is also equally true that petitioner became the owner of the
subject lot in 1995 and has been since that time deprived possession of a portion
thereof. From the date of the petitioner's dispossession in 1995 up to his filing of his
complaint for ejectment in 2001, almost 6 years have elapsed. The length of time
that the petitioner was dispossessed of his property made his cause of action beyond
the ambit of an accion interdictal and effectively made it one for accion publiciana.
After the lapse of the one-year period, the suit must be commenced in the Regional
Trial Court via an accion publiciana which is a suit for recovery of the right to
possess. It is an ordinary civil proceeding to determine the better right of possession
of realty independently of title. It also refers to an ejectment suit filed after the
expiration of one year from the accrual of the cause of action or from the unlawful
withholding of possession of the realty.17
25
Previously, we have held that if the owner of the land knew that another person was
occupying his property way back in 1977 but the said owner only filed the complaint
for ejectment in 1995, the proper action would be one for accion publiciana and not
one under the summary procedure on ejectment. As explained by the Court:
We agree with the Court of Appeals that if petitioners are indeed the owners of the
subject lot and were unlawfully deprived of their right of possession, they should
present their claim before the regional trial court in an accion publiciana or an accion
reivindicatoria, and not before the metropolitan trial court in a summary proceeding
for unlawful detainer or forcible entry. For even if one is the owner of the property,
the possession thereof cannot be wrested from another who had been in physical or
material possession of the same for more than one year by resorting to a summary
action for ejectment.18
The RTC should have taken cognizance of the case. If the case is tried on the merits by
the Municipal Court without jurisdiction over the subject matter, the RTC on appeal
may no longer dismiss the case if it has original jurisdiction thereof. Moreover, the RTC
shall no longer try the case on the merits, but shall decide the case on the basis of the
evidence presented in the lower court, without prejudice to the admission of the
amended pleadings and additional evidence in the interest of justice.19
WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals dated June
30, 2005 in CA-G.R. SP No. 73857 ordering the remand of Civil Case No. Br. 20-1194
to the Regional Trial Court of Cauayan, Isabela, Branch 20, for further proceedings, is
AFFIRMED.
No costs.

Hence, we agree with the Court of Appeals when it declared that: SO ORDERED.

The respondent's actual entry on the land of the petitioner was in 1985 but it was
only on March 2, 2001 or sixteen years after, when petitioner filed his ejectment
case. The respondent should have filed an accion publiciana case which is under the
jurisdiction of the RTC.

However, the RTC should have not dismissed the case.

Section 8, Rule 40 of the Rules of Court provides:

SECTION 8. Appeal from orders dismissing case without trial; lack of jurisdiction. — If
an appeal is taken from an order of the lower court dismissing the case without a
trial on the merits, the Regional Trial Court may affirm or reverse it, as the case may
be. In case of affirmance and the ground of dismissal is lack of jurisdiction over the
subject matter, the Regional Trial Court, if it has jurisdiction thereover, shall try the
case on the merits as if the case was originally filed with it. In case of reversal, the
case shall be remanded for further proceedings.

If the case was tried on the merits by the lower court without jurisdiction over the
subject matter, the Regional Trial Court on appeal shall not dismiss the case if it has
original jurisdiction thereof, but shall decide the case in accordance with the
preceding section, without prejudice to the admission of amended pleadings and
additional evidence in the interest of justice.

26
G.R. No. 87263 June 18, 1990
SPOUSES FLAVIO DEMAMAY AND ESTELITA DEMAMAY, petitioners,
vs.
COURT OF APPEALS, HON. SALVADOR P. DE GUZMAN, JR., LUZON DEVELOPMENT
BANK AND SPS. CESAR DE RAMOS AND CECILIA DE RAMOS, respondents.
Ernesto M. Miaquez for petitioners.
Eusebio Navarro, Jr. for respondent LDB.
Arnold Magparangalan for spouses Cesar de Ramos.
GANCAYCO, J.:
The issue as to whether or not an action for annulment of sale, reconveyance or
similar proceeding is a previous question before an action for ejectment or unlawful
detainer may proceed is the focus of the dispute in this petition.
Petitioners were the registered owners of a parcel of land located in Calamba, Laguna
covered by Transfer Certificate of Title No. T-35475 of the Register of Deeds of Laguna
with an area of about 240 square meters. They mortgaged the same to the Luzon
Development Bank (LDB for short) for the sum of P10,000.00 payable in installments in
five years beginning July 29, 1977. As petitioners defaulted in the payment of the loan
the LDB extra judicially foreclosed the mortgage on July 30, 1981 so the property was
sold at public auction to LDB as the highest bidder. Upon failure of the petitioners to
redeem the property within one year from the sale, title over the same was
consolidated in favor of LDB on September 13, 1982 so that petitioners' title was
canceled and TCT No. T-89122 was issued to LDB.
On July 26, 1986, LDB filed in the Regional Trial Court of Laguna a petition for the
issuance of a writ of possession docketed as RTC SLRC Case No. 111-83-C. Petitioners
filed an opposition thereto. On February 26, 1986, the trial court issued an order
authorizing the Clerk of Court to issue the corresponding writ of possession which was
returned unsatisfied. On June 20, 1986, LDB filed a motion for demolition which was
opposed by petitioners. Nevertheless the trial court granted the motion. A motion for
reconsideration of said order was filed by petitioners wherein it was alleged that LDB
was no longer the owner of the property inasmuch as it had already sold the same to
spouses Cecilia de Ramos and Cesar de Ramos and the title thereto of LDB had been
canceled and replaced by TCT No. T-89122 in the name of said Ramos spouses, who
have elected to file an unlawful detainer case against petitioners. The motion was
granted.
On August 8, 1986, petitioners filed an action against the Ramos spouses and LDB in
the Regional Trial Court of Laguna for annulment of sale, reconveyance of property
with damages. The suit was docketed as RTC Civil Case No. 1031-86.
On August 13, 1986, the Ramos spouses filed an action for unlawful detainer against
petitioners in the Municipal Trial Court of Calamba, Laguna docketed as Civil Case No.
2405. Petitioners filed their answer with crass claim alleging among others the
pendency of the annulment case before the RTC. On motion of LDB the said cross
claim was dismissed. On June 29, 1987 a decision was rendered ordering petitioners to
vacate the property in question within sixty (60) days from receipt thereof, to pay
attorney's fees in the amount of P2,000.00 and the cost of the suit. The counterclaim
was dismissed. Petitioners appealed the decision to the Regional Trial Court of Laguna
but the same was affirmed. They filed a petition for review in the Court of Appeals
wherein on October 7, 1988 a decision was promulgated dismissing the petition with
costs against petitioners.1 A motion for reconsideration filed by petitioners was denied
by the appellate court in a resolution dated March 2, 1989.
Meanwhile the annulment case was dismissed by the trial court on the ground of res
judicata. Petitioners appealed to the Court of Appeal wherein on September 21, 1988
a decision was rendered setting aside the appealed order of dismissal and remanding
the records to the lower court for further proceedings and adjudication on the merits.
2
In said case the appellate court ruled that the petition for a writ of possession is not a
bar to the prosecution of the annulment case.
Hence, the herein petition for review on certiorari wherein petitioners raise, as errors
allegedly committed by the appellate court in grave abuse of discretion, namely: (1)
the failure to declare that the Municipal Trial Court has no jurisdiction over the
unlawful detainer case due to the failure to allege in the complaint that private
respondents Ramos spouses had prior physical possession of the property; and (2)
that the proceedings in said unlawful detainer case should be suspended pending the
resolution of the action for annulment of the sale, reconveyance and damages
pending before the Regional Trial Court of Laguna.
27
On May 24, 1989 the petition was denied for failure of petitioners to sufficiently show
that the respondent court had committed any reversible error in its questioned
judgment. A motion for reconsideration was filed by petitioners to which an
opposition was filed by private respondents. The parties were then required to submit
their simultaneous memoranda. This requirement has been complied with by the
parties.
On the first issue, petitioners contend that as they continued to be in physical
possession of the property and in the absence of the jurisdictional allegation in the
complaint for unlawful detainer that private respondents had prior physical possession
of the property the lower court did not acquire jurisdiction over the case.
In the questioned decision of the respondent court dated October 7, 1988, the
following disquisition was made:
Under the provisions of Rule 70 of the Rules of Court, an unlawful detainer case may
be filed by any landlord, vendor or vendee (like herein private respondents) against
whom the possession of any land or building is unlawfully withheld after the expiration
or termination of the right to hold possession by virtue of any contract express or
implied. Petitioners' right to Possess the property in question terminated from the
moment they ceased to be the owners thereof and the transfer of said ownership to
Luzon Development Bank. This was bolstered by the issuance of a writ of possession
turning over the possession thereof to the Bank, which in turn transferred its right of
ownership or possession to private respondents, who in turn became the owners
thereof entitled to its possession with the issuance in their name of the title to the
property.
Premises considered. We find no reversible error of law or fact in the decision under
review. 3
We agree.
It is true that in forcible entry cases the plaintiff must allege and prove that he was in
prior physical possession of the property in litigation until he was deprived thereof
by the defendant. However, in unlawful detainer cases, the plaintiff need not have
been in prior physical possession of the property.
The second issue is likewise devoid of merit. Pending in the Regional Trial Court
(RTC), Laguna is an action for the annulment of the sale to private respondent, the
foreclosure of mortgage, reconveyance and damages. Petitioners claims that the
proceedings in the ejectment case must be suspended until after the said annulment
case is resolved by the Court.
The Court takes note of the fact that some lessees, realizing that the action for
unlawful detainer will be filed against them shortly, "jump the gun" on the lessor by
going to court first. They institute, for instance, actions for consignation of rentals, or
for specific performance of alleged agreement for renewal of lease or as in this case
for annulment of the sale, etc.
The advantage of having the question of possession of the leased premises
determined in such an ordinary action of consignation, breach of contract or
annulment of sale, instead of a summary ejectment suit, are obvious. The
proceedings are not summary, and presumably would take longer than an action for
unlawful detainer. The judgment against the lessee is not immediately executory and
there is no need to file a supersedeas bond to stay execution, and the remedy of
preliminary mandatory injunction is not usually available to the lessor.
The question is, may the pendency of such an action for consignation or specific
performance, or annulment of a sale, as in this case, be successfully pleaded in
abatement of an action for unlawful detainer? This Court has invariably given a
negative answer.
In Lim Si vs. Lim, 5 the lessee disagreed with the increased rental rate imposed by the
lessor and brought in the Court of First Instance (CFI) a suit for consignation of
rentals praying that the court fix the rate thereof and he be authorized to remain in
the premises in the meantime. The lessor moved to dismiss, arguing that the issue
raised should not be resolved in an action of consignation but in an unlawful detainer
suit. Later, the lessor did in fact file an ejectment action against the lessee. The trial
court dismissed the action. In sustaining the dismissal this Court citing Pue, et al. vs.
Gonzales, 6 held that consignation —
is not the proper proceedings to determine the relation between landlord and
tenant, the period of life of the lease of tenancy, the reasonableness of the amount
of rental, the right of the tenant to keep the premises against the will of the landlord,
etc. (which) questions should be decided in a case of ejectment or detainer.
and ruled as follows:
The principle ... exactly covers the point at issue, i.e., that the disagreement between
a lessor and a lessee as to the amount of rent to be paid by a lessee cannot be
28
decided in an action of consignation but in that of forcible entry and unlawful
detainer that the lessor institutes when the lessee refuses to pay the lessor the rents
that he has fixed for the property. It may also be added that consignation is proper
when there is a debt to be paid, which the debtor desires to pay and which the
creditor refuses to receive, or neglects to receive, or cannot receive by reason of his
absence. The purpose of consignation is to have the obligation or indebtedness
extinguished. In the case at bar, plaintiff seeks to have the obligation determined and
fixed, hence his action should not be one of consignation.

For the foregoing reasons, we hold that plaintiff has no cause of action against
defendant under the facts alleged in his complaint; that consignation is not the
proper remedy; that it is the defendant who has the right or cause of against the
plaintiff because the latter refuses to pay the rents fixed but does not leave the
property; and that if the plaintiff claims that the amount of rents demanded by the
defendant is unreasonable and he desires to have it fixed judicially, he may set forth
the above facts as defenses in the action of ejectment filed by the defendant against
him. ...

The same ruling was rendered by this Court in Teodoro vs. Mirasol 7 where an action
for specific performance to compel the lessor to renew the lease was held to be a
proper defense in the ejectment suit. 8 In the same vein this Court held that an
action for reconveyance or action for reivindicatoria or quieting of title or injunction
or reformation may not be pleaded in abatement of an ejectment suit. 9

The case of Quiambao v. Osorio, 10 invoked by petitioners cannot support their

cause. In said case, the ejectment suit was sought to be suspended on the ground of
the pendency of an administrative case in the Office of the Land Authority where the
agreement of sale of the lot in question, on which respondents based their prior
possession, had already been canceled by the Land Authority. Thus, this Court held
the prudent course for the trial court to do is to hold the ejectment proceeding, until
after the determination of the administrative case. There is no analogy in the facts of
the said case with the present case.

WHEREFORE, the petition is DENIED with costs against petitioners.

SO ORDERED.

29
G.R. No. L-53788 October 17, 1980
PHARMA INDUSTRIES, INC., petitioner,
vs.
HONORABLE MELITON PAJARILLAGA OF THE CITY COURT OF CABANATUAN CITY,
NUEVA ECIJA, BRANCH II, SERGIA A. DEL ROSARIO AND "JOHN DOE/S", respondents.
ABAD SANTOS, J.:
Certiorari to review the actuations of the respondent judge in Civil Case No. 8126 of
the City Court of Cabanatuan which the plaintiff, the petitioner herein, initiated for
the purpose of ejecting the private respondents from a piece of land.
In a "Decision" dated January 7, 1980, the respondent judge dismissed the case for
lack of jurisdiction. A motion to reconsider the dismissal was denied, hence the
present petition.
The facts and the law as understood by the respondent judge are set forth in his
"Decision" which is hereby reproduced in full:
This is a complaint for Ejectment filed by the plaintiff against the defendant. The
plaintiff in its complaint alleges that on November 12, 1977, the defendant Sergia A.
del Rosario executed in favor of the plaintiff a Deed of Sale with Right to repurchase
over a piece of land duly registered and situated at Cabanatuan City, together with
all improvements and which land is covered with TCT No. 12481, now TCT No.
35940, that the defendant Sergia del Rosario executed to exercise her right of
redemption in accordance with the Provision of Annex A, Deed of Sale with Right to
Repurchase, which expired November 12, 1978, and despite notice to her, the
plaintiff was constrained to file a petition for consolidation of ownership, Annex B;
that on April 3, 1979, the Honorable Virgilio D. Pobre-Yñigo, promulgated a decision
in favor of the plaintiff and against the defendant, declaring the plaintiff to be the full
owner of the property and ordering the Register of Deeds of Cabanatuan City, to
cancel the old title; and issue a new title, TCT No. L-35940 in the name of the
plaintiff; that on June 8, 1979, the plaintiff sent a letter to the defendant and all
person claiming ownership, to vacate the premises in question; that despite receipt
of Annex E, by the defendant on June 13, 1979, she failed and refused and still fails
to vacate the premises without justification.
The defendant filed her answer, admitting the allegations on Par. 1, 2, & 3, and
denied the allegation in Par. 4, alleging that the defendant thru her representative
Alfredo del Rosario verbally agreed to the counsel of the plaintiff, that after
recomputation of the amount demanded being enormous and unconscionable, the
latter should pay her obligation but contrary to the agreement to plaintiff thru
counsel, did not honor the same and still continued the prosecution in this case, until
the decision was rendered by this Court, to the damage and prejudice of the
defendant, who is ready and able to pay her obligation; that defendant admitted the
allegation in Par. 5 of the answer of the complaint, as far as the decision rendered
for consolidation, but denies the rest of the allegations, because of the agreement
which was dishonored by the plaintiff; that defendant also admitted the allegations
in Par. 6, 7 & 8, but denies the allegation in Par. 9.
On November 28, 1979, the plaintiff filed a motion for judgment on the pleading, on
the ground that the defendant admitted all the material averments of the complaint
and does not tender at all an issue. The defendant filed an opposition to the motion
of judgment on the pleading, and a motion to dismiss, on the ground that this Court
has no jurisdiction, and that it is the Court of First Instance, which has jurisdiction
over the action, (Roman Catholic Bishop of Cebu versus Mangaron, 6 Philippines 286,
291). The complaint filed by the plaintiff is for ejectment. There are three kinds of
action in ejecting a person from the land. It is clear in the complaint that the plaintiff
is intending to eject the defendant from the land under the kind of ejectment,
forcible entry or detainer, but it must be alleged in the complaint prior possession of
the land by the plaintiff. But in the complaint it is alleged that the defendant is in
possession of the land and not the plaintiff, and therefore the complaint should be
for recovery of the right to possess the land, and the action should be filed in the
Court of First Instance and not in this Court. The three kinds of action are the
following: (1) The summary action for forcible entry or detainer by denominated
action interdictal, under the former law of procedure (Ley de Enjuiciamiento Civil)
which seeks the recovery of only physical possession, and is brought within one year
in the Justice of the Peace Court; (2) The accion publiciana which is intended for the
recovery of the right to possess and is a plenary action in an ordinary civil
proceeding, before the Court of First Instance and (3) Action de revindication which
seeks the recovery of ownership which of course included the Jus utendi and jus
fruendi also brought in the Court of First Instance. Of these three kinds of action
should be brought under No. 2 which is accion publiciana intended to recovery of the
right to possess possession from the defendant, because it is the defendant who is in
possession of the premises. The Court in its opinion, held that the complaint must be
30
filed with the Court of First Instance of Nueva Ecija, because it is for a recovery of
possession which is under the law, belong to the jurisdiction of the Court of First
Instance of Nueva Ecija.
WHEREFORE, judgement is hereby rendered, dismissing this case.
We have to grant the petition. The proper remedy is ejectment under Rule 70 of the
Rules of Court and not accion publiciana. Sec. 1 of said Rule provides:
SECTION 1. Who may institute proceedings, and when. — Subject to the provisions
of the next succeeding section, a person deprived of the possession of any land or
building by force, intimidation, threat, strategy, or stealth, or a landlord, vendor,
vendee, or other person against whom the possession of any land or building is
unlawfully withheld, after the expiration or termination of the right to hold
possession, by virtue of any contract, express or implied, or the legal representatives
or assigns of any such landlord, vendor, vendee, or other persons, may, at any time
within one (1) year after such unlawful deprivation or withholding of possession,
bring an action in the proper inferior court against the person or persons unlawfully
withholding or depriving of possession, or any person or persons claiming under
them, for the restitution of such possession, together with damages and costs. The
complaint must be verified.
It should be noted that the summary action provided above is one to obtain
possession only, filed in a municipal court within one year after the unlawful
deprivation or withholding of possession complained of has taken place. It should
also be noted that the remedy provides for two distinct causes of action: (1) forcible
entry in which the defendant's possession of the property is illegal ab initio, and (2)
unlawful detainer wherein the defendant's possession was originally lawful but
ceased to be so by the expiration of his right to possess.
The present case which is to obtain possession only is one for unlawful detainer
because Sergia A. del Rosario, the vendor a retro, failed to repurchase the property
and after the consolidation of title in favor of the vendee a retro had been
confirmed, she refused to vacate the property upon demand and after her right to
possess it had ceased to be lawful. That a demand to vacate was made on Sergia A.
del Rosario on June 13, 1979, and the action to eject was filed on October 22, 1979,
well within the one-year period, are borne by the record.
The mistake of the respondent judge in his belief that the cause of action is forcible
entry wherein it is necessary to alleged prior possession and forcible deprivation
thereof. But as stated above, the cause of action in this case is for unlawful detainer
and it is sufficient to allege, as was done, that the defendant was unlawfully
withholding possession from the plaintiff. (See 3 Moran, Comments on the Rules of
Court, 302 [1970].)
Where the cause of action is unlawful detainer, prior possession is not always a
condition sine qua non. This is especially so where a vendee seeks to obtain
possession of the thing sold to him from the vendor. But if prior possession be
insisted upon, Pharma Industries, Inc. had it before the suit for unlawful detainer was
filed. Art. 531 of the Civil Code provides: "Possession is acquired by the material
occupation of a thing or the exercise of a right, or by the fact that it is subject to the
action of our will, or by the proper acts and legal formalities established for acquiring
such right. (438a)" And according to Tolentino, "proper acts and formalities" refer
"to judicial acts, or the acquisition of possession by sufficient title, Inter vivos or
mortis causa, onerous, or lucrative. These are acts to which the law gives the force of
acts of possession. Examples of these are donations, succession, whether intestate
or intestate, contracts, such a sale with right of repurchase, judicial possession,
execution of judgments, such as when a sheriff, pursuant to a decision or order of
the court, places certain parties in possession of property, execution and registration
of public instruments, and the inscription of possessory information titles." (II Civil
Code of the Philippines, 246-247 [1972],)
Pharma Industries, Inc. acquired possession when Sergia A. del Rosario executed in
its favor on November 12, 1977, the deed of sale with right to repurchase over the
land in question and the vendee's title was confirmed upon failure of the vendor to
repurchase the property. (Annexes A-1, A-2, and A-3, Petition.)
Private respondent states that subsequently on August 25, 1980, Civil Case No. 7326
was filed in the Court of First Instance of Nueva Ecija to declare the deed of sale with
the right to repurchase executed by Sergia A. del Rosario in favor of Pharma
Industries, Inc. as an equitable mortgage. Such a suit, however, is not a bar to the
ejectment suit.
WHEREFORE, finding the petition to be meritorious, it is hereby granted and, as
prayed for, the respondent judge is hereby ordered to take cognizance of Civil Case
No. 8126 in his court and to resolve the petitioner's Motion for Judgment on the
Pleadings. No special pronouncement as to costs. SO ORDERED.
31
G.R. No. 93451 March 18, 1991 7. When plaintiff wanted to go inside his room in the following morning of
September 30, 1987 to fetch three (3) of his law books, which he needed to read in
LIM KIEH TONG, INC., petitioner, connection with a case he is handling, he was surprised to find out that the key given
vs. him could no longer fit the door lock which was then already changed;
THE COURT OF APPEALS, HON. JUDGE ROGELIO M. PIZARRO, Presiding Judge of
Branch 16 of the Metropolitan Trial Court of Manila, and REGINALDO Y. LIM, 8. Consequently, plaintiff had to buy three (3) new law books for which he incurred
respondents. expenses in the sum of Pl,253.00, if only to be able to prepare for his cases;

Balgos & Perez for petitioner.
Madamba, Lim & Tan for private respondent.
GANCAYCO, J.:
The issue of whether a complaint filed in the Metropolitan Trial Court of Manila is
one for forcible entry and detainer or one for specific performance is the center of
this litigation.
The facts are not disputed as related by the respondent Court of Appeals in its
questioned decision dated December 7, 1988 —
The record reveals that on October 23, 1987, the appellee, Reginaldo Y. Lim, had
filed a complaint before the Metropolitan Trial Court of Manila, in part, alleging, as
follows:
3. Plaintiff and his family had for some time resided in Room 301 of the building
adverted to in the next preceding paragraph, until they transferred to their present
residence at No. 3 Igdalig Street, Quezon City;
4. The said room 301 has thereafter been utilized by plaintiff as a place where he
keeps some of his important belongings, such as his law books, important
documents, appliances, etc.;
5. The aforementioned building has only one common main door through which all
the occupants of the various rooms therein, including that of plaintiff, can get in and
out therefrom;
6. Accordingly, each and every occupant of any and all of the rooms of the building
including plaintiff has been given a key or a duplicate key to the doorlock by Rafael
Lim, the Officer-in-Charge of defendant corporation;
9. Plaintiff was only able to contact defendant through its Officer-in-Charge, Mr.
Rafael Lim, the following day, October 1, 1987, but his request for him to be
provided with the appropriate key produced negative result, hence, this suit where
plaintiff incurred expenses in the form of attorney's fees and costs of suit.
ALLEGATIONS IN SUPPORT OF PRAYER FOR PRELIMINARY MANDATORY
INJUNCTION/RESTRAINING ORDER
10. Plaintiff repleads all the foregoing allegations by way of reference to form part of
the prayer for the issuance of a writ of preliminary mandatory injunction;
11. The failure and/or refusal of defendant to furnish plaintiff the appropriate key,
above-cited, constitutes a violation of the substantial rights of plaintiff, who has a
clear and unmistakable right to the use and enjoyment of Room 301 of the building
owned by defendant corporation, such that there is an urgent and paramount
necessity for the issuance of the writ of preliminary injunction/restraining order
commanding defendant to furnish plaintiff the appropriate key in order to prevent
great and and/or irreparable damages and injury upon plaintiff.
In conclusion, the said appellee prayed, as follows:
PREMISES CONSIDERED, it is most respectfully prayed of the Honorable Court that a
writ of preliminary mandatory injunction/restraining order commanding defendant
to provide plaintiff the appropriate key or a duplicate key to the lock of the main
door of the building be immediately issued, and, after hearing the case on its merits,
judgment be rendered in favor of plaintiff and against defendant ordering:
l. the injunction prayed for in the complaint;
2. defendant to pay plaintiff the sum of Pl,253.00 as actual compensatory damages;
3. defendant to pay plaintiff the sum of P5,000.00 as and for attorney's fees; and

32
4. the cost of suit.
Plaintiff prays for such other reliefs and/or remedies which the Honorable Court may
deem just and proper in the premises. (p. 13, orig. rec.)
The opening paragraphs of the questioned decision relate what had happened in the
courts below:
This is a special civil action for certiorari under Rule 65, grounded on pure questions
of law.
The case is simplicity itself.
The undisputed facts are as follows:
Petitioner is a duly organized domestic corporation and is the owner of a building
located at 1231 Piedad Street corner Benavidez Street, Manila;
Public respondent is the Presiding Judge of the Metropolitan Trial Court, Branch 16;
For sometime prior to the filing of this petition, Lim Eng Piao, father of private
respondent, occupied said premises as a dwelling unit at the above given address
together with all the members of his family. Lim Eng Piao subsequently died. Said
occupancy was continued by private respondent. Later, the latter was able to acquire
a house and lot at No. 3 Igdalig Street, Quezon (sic). In spite of having transferred
residence, private respondent did not vacate Room 301 of the building in question.
Instead, he utilized the same as a place where he keeps some of his important
belongings, papers, books, documents and appliances . . .
On or about September 1987, petitioner changed the lock of the common main door
of the building.
On the morning of September 30, 1987, private respondent tried to go to Room 301
but found that the key given him could not fit and open the main door. As one of the
occupants of the building in question, private respondent demanded from
petitioner's officer-in-charge the delivery to him of the appropriate keys to the said
common main door so that he could enter the premises and be restored to
possession of said Room No. 301 of the building, but his efforts proved futile as the
officer in charge did not heed his demand . . .
On October 2, 1987, by reason of the unjustifiable ouster of private respondent from
said premises, he instituted Civil Case No. 122546 entitled Reginaldo Y. Lim vs. Rafael
Lim and Lim Kieh Tong & Co., Inc. before the Metropolitan Trial Court which was
raffled to Branch 25. Said complaint was denominated as an action for damages with
injunction despite the allegations contained therein . . .. The aforesaid case was
subsequently dismissed for lack of jurisdiction . . .
On October 23, 1987, private respondent again instituted another action at the
Metropolitan Trial Court docketed as Civil Case No. 122775 which was raffled to
Branch 16. The complaint reiterated the same allegations . . .
On November 2, 1987, a temporary restraining order was issued by respondent
judge pending trial on the merits, commanding petitioner to deliver the appropriate
keys to private respondent and allow him to enter the premises and occupancy of
Room No. 301 of the building . . .
On November 3, 1987, petitioners instituted the instant petition;
On the same date after an ex-parte hearing, the Executive Judge of this Court, in
order to obviate any possible injustice pending the determination of the issuance of
the injunctive writ, issued a temporary restraining order, enjoining the enforcement
of the temporary restraining order earlier issued by respondent judge and from
further taking cognizance of said Civil Case No. 122775; . . .
In ruling in favor of the private appellee, the appellee judge, in part, stated:
In this case force was used by petitioner to deprive private respondent of the
physical possession of Room 301 when the lock of the main door was changed
without his knowledge and consent.
The issued (sic) involved is mere physical possession (possession de facto) and not
juridical possession (possession de jure) nor ownership (Mercado vs. Go Bio, 78 Phil.
279; Masallo, vs. Cesar, 39 Phil. 134).
The purpose of forcible entry is that regardless of the actual condition of the title to
property, the party in peaceable and quiet possession shall not be turned out by
strong hand, violence or terror . . . In affording this remedy, breaches of the peace
and criminal disorder would be minimized. A party out of possession must respect
and resort to the law alone to obtain what he claims is his. (Supia and Batioco vs.
Quintero and Ayala, 59 Phil. 312).
33
Considering that respondent judge found the applicability of the Rule in Summary
Procedure, the motion to dismiss was correctly denied. A motion to dismiss being
one of the prohibited pleadings and motions under Section 15 of the 1983 Rules on
Summary Procedure.
Hence, the petition must fail on this score alone.
Anent the second issue, petitioner contended that when the amount of damages
claimed is not specifically alleged in the complaint, jurisdiction over the case would
fall under the Regional Trial Courts, as the failure to so allege would characterize the
subject matter as one which is incapable of pecuniary estimation.
Petitioner's contentions is (sic) not well-taken.
In Singson vs. Aragon, 92 Phil. 514, the Supreme Court held that exemplary damages
must be specified and if not, the municipal trial court could still grant it, if together
with the other money claims, the amount of the total claim does not exceed
P10,000.00 (now P20,000.00).
As to moral damages, the aforesaid ruling can likewise be made to apply.
What confers jurisdiction on the inferior court in forcible entry and illegal detainer
cases is NOT the amount of unpaid rentals or damages involved, but rather the
nature of the action because the rents or damages are only incidental to the main
action (Vichanco vs. Laurilla, L-13935, June 30, 1960).1
An appeal was taken to the Court of Appeals. The appeal was dismissed for lack of
merit.2 A motion for reconsideration filed by petitioner was denied in a resolution
dated May 9, 1990.3
Hence, this petition for review the main thrust of which is that the action being one
for specific performance the jurisdiction thereof is vested in the Regional Trial Court.
The petition must fail.
A reading of the allegations of the complaint show that private respondent and his
family resided in Room 301 of the building of petitioner until they transferred to
their present residence at No. 3 Igdalig St., Quezon City. However, private
respondent retained possession of said room to keep his important belongings, such
as his law books, important documents, appliances, etc. The building has only one
common main door through which all the occupants of the various rooms therein
can get in and out.1âwphi1 Accordingly, all occupants including private respondent
were given a key to the main doorlock by petitioner.
However, when private respondent wanted to go inside his room on September 30,
1987 to get three (3) of his lawbooks which he needed to read in connection with a
case he was then handling, he found that the key he possessed was no longer
compatible with the lock, i.e., the same was changed. Private respondent had to buy
three (3) new lawbooks for Pl,253.00 to prepare for his cases. He requested private
respondent to provide him the appropriate key but his request was denied.
Petitioner also alleges that he has a clear and unmistakable right to the use of said
room entitling him to the writ of preliminary mandatory injunction to command
petitioner to provide him the appropriate key to the lock of the main building; and to
pay damages in the amount of Pl,253.000, P5,000.00 attorney's fees and costs of the
suit.
From the foregoing facts alleged in the complaint, the Court holds that the suit is one
for forcible entry and detainer under Rule 70 of the Rules of Court. Private
respondent retained the possession of Room 301 of petitioner's building which he
claimed to have the right to use and enjoy, but petitioner prevented him from
enjoying his right by depriving him of the right of egress and ingress through the
main door of the building. Through stealth, petitioner changed the key to the main
door thus depriving private respondent of the possession of his rented room.
Any person deprived of possession of any land or building or part thereof, may file an
action for forcible entry and detainer in the proper inferior court against the person
unlawfully depriving or withholding possession from him4
This relief is not only available to a landlord, vendor, or vendee, but also to a lessee
or tenant or any other person against whom the possession of any land or building,
or a part thereof, is unlawfully withheld, or is otherwise unlawfully deprived
possession thereof, within one (1) year after such unlawful deprivation or
withholding of possession.
WHEREFORE, the petition is DENIED. No costs.
SO ORDERED.
34
G.R. No. 77133 July 19, 1989
SPOUSES MARCIANO BANDOY and SEGUNDINA BANDOY, petitioners,
vs.
HON. COURT OF APPEALS and DOMINGO P. EMPAYNADO respondents.
Gil S. San Diego for petitioners.
Benjamin G. Galima for private respondent.
MEDIALDEA, J.:
This is an appeal by certiorari of the decision (pp. 27-31, Rollo) of the Court of
Appeals dated January 13, 1987 in CA G.R. SP. No. 09391 entitled "Spouses Marciano
and Segundina Bandoy, Petitioners, vs. Hon. Luis L. Victor, in his capacity as Presiding
Judge, Branch XCVI, RTC, and Domingo Empaynado, Respondents," which affirmed
the decision of the Regional Trial Court, National Capital Region, Branch XCVI,
Quezon City, dismissing the herein petitioner's complaint for ejectment on the
ground of lack of jurisdiction due to the lack of demand to pay rentals and to vacate
the premises.
The antecedent facts of the case are as follows:
Spouses Marciano and Segundina Bandoy herein petitioners, were lessees of a
residential house and lot owned by the University of the Philippines and located at
No. 88-D, Phase 4, Pook Amorsolo, U.P. Campus, Quezon City.
Sometime in April 1984, petitioners sublet certain spaces of the property to Eduardo
Empaynado, herein private respondent, for a monthly rental of P550.00. Empaynado
failed to pay the rental for the month of July, 1985. Upon demand by petitioners,
Empaynado still failed and refused to pay.
Petitioners brought the matter to the office of the barangay captain for settlement,
but to no avail. On August 20, 1985, a certification to file action against Domingo
Empaynado for ejectment and non-payment of house rentals including light and
water (Annex "A" to the petition, p. 1 0, Rollo) was issued by the office of the
barangay captain.
On November 26,1985, petitioners filed a complaint for ejectment against
Empaynado and attached thereto the certification to file action issued by the
barangay captain. The case was filed with the Metropolitan Trial Court of Metro
Manila, Quezon City and docketed as Civil Case No. XXXV-48898.
In his answer, Empaynado admitted that he did not pay the rentals since July 1985
but denied that there was a demand to vacate and pay made upon him by spouses
Marciano and Segundina Bandoy.
After trial, judgment was rendered in favor of the spouses. The decision, dated
March 6, 1986 reads, in part:
x x x.
At any rate, the court is of the view that a demand to vacate before the barangay
court is a substantial equivalent of the required extrajudicial demand to pay and
vacate required by the Rules of Court prior to the filing of an ejectment case in court.
x x x.
ACCORDINGLY, judgment is hereby rendered in favor of plaintiff spouses Marciano
and Segundina Bandoy ordering the defendant Domingo Empaynado and all persons
claiming rights under him to vacate the residential house or extension thereof at the
lot known as No. 88-D, Phase 4, Pook Amorsolo, U.P. Campus and to surrender the
same peacefully to the plaintiffs. The defendant is likewise required to pay all unpaid
rentals at the rate of P550.00 a month from July 1985 up to the time the defendant
vacates the premises at bar; and to pay the plaintiff P700.00 as reasonable attorney's
fee and the costs of suit.
SO ORDERED. (pp. 21-22, Rollo)
Domingo Empaynado appealed the decision to the Regional Trial Court which
rendered a decision dated June 2, 1986 dismissing the case for ejectment for lack of
jurisdiction on the part of the trial court. The decision reads:
ACCORDINGLY, in the light of the foregoing disquisition, on the ground of lack of
jurisdiction, the decision appealed from is hereby set aside and this case ordered
dismissed, without pronouncement as to costs.
SO ORDERED. (p. 25, Rollo)
35
Spouses Marciano and Segundina Bandoy filed a petition for review of the decision
of the Regional Trial Court to the Court of Appeals. In a decision promulgated on
January 14, 1987, the Court of Appeals dismissed the case also for lack of jurisdiction
on the part of the trial court. The decision reads, in part:
x x x.
And where the Metropolitan Trial Court did not acquire jurisdiction, the above
jurisprudence would hold and all we can do is to dismiss the case for lack of
jurisdiction.
WHEREFORE, there having been no error committed by the Regional Trial Court, the
petition for review is hereby DENIED.
SO ORDERED. (pp. 30-31, Rollo)
Not satisfied with the decision of the Court of Appeals, petitioners come to Us on a
lone assignment of error, that:
THE HONORABLE COURT OF APPEALS ERRED IN DENYING THE PETITION FOR REVIEW
AND IN AFFIRMING THE RULING OF THE REGIONAL TRIAL COURT THAT THE
METROPOLITAN TRIAL COURT DID NOT ACQUIRE JURISDICTION OVER THE CASE.
It is the contention of petitioners that no further demand to vacate was made by
petitioners after the certification to file was issued by the Barangay captain for the
reason that the case was already certified for court action. Under this situation, any
further demand to vacate was merely repetitive and unnecessary.
There is no merit in this contention.
It is not disputed that the complaint contains no allegation that there was a prior
demand to vacate made by the petitioners upon private respondent. It is a settled
rule that "where the complaint contains no allegation that a demand had been made
upon the defendant to vacate the premises but only an allegation that a demand was
made for payment of the rentals agreed upon, it is held that such allegation is
insufficient to confer jurisdiction upon a justice of the peace court" (Casilan vs.
Tomassi, et al., 10 SCRA 261, 264; Santos vs. Vivas, 96 Phil. 538, 540). The
certification issued by the office of the barangay captain is not conclusive as to the
jurisdiction of the court to which the case was subsequently filed. What was certified
by the barangay captain was that no settlement was reached by the parties in the
barangay level. It did not certify that all the requisites for the filing of an unlawful
detainer case had been complied with.
In the case of Co Tiamco vs. Diaz, L-7, January 22, 1946 (75 Phil. 672), relied upon by
petitioners, there was no allegation in the complaint that a notice to quit or vacate
was made upon the defendants. However, during the presentation of evidence,
plaintiffs offered Exhibit "A" as evidence, which is a notice to quit alleged to have
been served upon defendants prior to the filing of the action. This was objected to by
the defendants and the objection was sustained by the trial court. The defendants
filed with the Court of First Instance a petition for mandamus to compel the
municipal court judge to admit Exhibit "A". By virtue of a writ of mandamus issued by
the Court of First Instance, the evidence was admitted. In that case, it was held that:
even supposing without conceding, that the complaint is deficient (in not alleging the
notice to quit) the deficiency was cured by the evidence. (P. 679, supra)
But, the above case of Co Tiamco cannot be applied in this case. In the Co Tiamco
case, it was proven that there was indeed a notice to quit or demand to vacate
served upon the defendants. The notice to vacate was offered and admitted in
evidence. In the case at bar, the complaint was defective because of its failure to
allege that there was a prior demand to vacate. The defect was not cured because
no evidence of a prior demand to vacate was presented in the trial court. The
affidavit of Empaynado relied upon by the trial judge to the effect that: "na ako ang
tinutukoy ni Marciano Tamis Bandoy dahil di umano'y sa di magandang asal namin na
gusto niyang paalisin sa kanyang extension", does not prove that the spouses
demanded that he vacate the premises. What Empaynado admitted in the said
affidavit was that the spouses intended to expel him out of the premises ("gusto
niyang paalisin') but has not actually or definitely demanded that he vacate the
premises. An intention to oust is different from an actually or definitely demanded to
vacate. It is the latter which confers jurisdiction upon the municipal court.
ACCORDINGLY, the petition is DENIED. The decision of respondent Court of Appeals
is affirmed. No costs.
SO ORDERED.
36
G.R. No. L-20330 December 22, 1966
ADOLFO RACAZA, petitioner,
vs.
SUSANA REALTY, INC., respondent.
Fortunato M. Ejercito for petitioner.
Bausa, Ampil and Associates and Alfredo G. Palacol for respondent.
REGALA, J.:
Petitioner is the lessee of a portion of a piece of land located at San Juan St., Pasay
City, and owned by respondent corporation. He started renting this portion of the lot
in 1952 when his wife, Evarista P. Racaza, bought an unfinished house that had been
built on it. On assurance of respondent that petitioner's family could stay on the land
by paying a monthly rent of P15, petitioner finished the construction of the house
and he and his family lived in it. On December 16, 1955, however, petitioner was
asked to vacate the land because respondent needed it. The demand was followed
by the filing on February 10, 1956 of a complaint for ejectment in the Municipal
Court of Pasay City. Petitioner and his family remained in the premises as the case
was dismissed for failure of respondent to proceed to trial.
On December 17, 1957, petitioner received another letter from respondent
demanding anew the surrender of the premises. On February 19, 1958, another
ejectment suit was filed against him, the complaint alleging that respondent needed
the lot "for the purpose of constructing improvements thereon and for other uses
but that despite repeated demands petitioner refused to leave the premises.
In his answer, petitioner denied that the lease was on a month-to-month basis and
claimed that his understanding with respondent was that he would be allowed to
stay on the premises as long as he paid a monthly rent of P15. As counterclaim,
petitioner demanded the payment of P12,000 which he said he had spent to finish
the construction of his house.
After trial, the court ordered petitioner to vacate the premises and pay P15 a month
until he had done so, even as it dismissed his counterclaim for lack of merit.
Petitioner appealed to the Court of First Instance of Pasay, reiterating his
counterclaim. He asked for the dismissal of the complaint on the ground of lack of
jurisdiction of the municipal court to try it, claiming that the complaint was filed
more than one year after the alleged unlawful detainer.1 According to petitioner, the
first complaint for ejectment was dismissed on November 23, 1956, while the
complaint in this case was not filed until February 19, 1958.
Again, petitioner was ordered evicted; his counterclaim was thrown out for lack of
jurisdiction. It was held that petitioner's illegal possession should be deemed to have
started on December 17, 1957, when the second demand to vacate was made on
him, because the complaint in this case was not intended to revive the one
previously dismissed for lack of prosecution. Since the complaint was filed on
February 19, 1958, jurisdiction over the case was properly acquired by the municipal
court. At the same time, it was held that the counterclaim was correctly dismissed as
the amount of the demand (P12,000) was beyond the jurisdiction of the municipal
court to grant.
Petitioner asked for a reconsideration and, failing to secure one, appealed to the
Court of Appeals. First, he contended that the municipal court did not have
jurisdiction because by respondent's own evidence rents had not been paid since
July, 1955 and it should be from this date that the one-year period should be
counted. Second, petitioner claimed that, instead of dismissing his counterclaim, the
lower court should have assumed original jurisdiction over it, considering that
evidence to support the counterclaim had been allowed without objection from the
respondent.
After stating that in actions for unlawful detainer, notice to vacate need not be
alleged but may merely be shown by evidence, the appellate court ruled that the one
year period should not be counted from July, 1955 because the parties had
stipulated that petitioner was up to date in the payment of rents. Neither should it
be reckoned from November 23, 19562 when the first demand to vacate was made
because it was respondent's privilege, as lessor, to waive the right to bring an action
based on the first demand. (Zobel v. Abreu, 98 Phil. 343 [1956]) Rather, the starting
point should be December 17, 1958 when the second demand to quit was made by
respondent because, as held in Cruz vs. Atencio, G.R. No. L-11276, February 28,
1959,
Where despite the lessee's failure to pay rent after the first demand, the lessor did
not choose to bring an action in court but suffered the lessee to continue occupying
the land for nearly two years, after which the lessor made a second demand, the
one-year period for bringing the detainer case in the justice of the peace court
should be counted not from the day the lessee refused the first demand for payment
37
of rent but from the time the second demand for rents and surrender of possession against him even before the expiration of the fifteen or five days provided in Rule 70,
was not complied with. section 2.

On this score, the court overruled petitioner's first assignment of error. Accordingly, upon the expiration of the lease in this case, petitioner became a
deforciant unlawfully withholding possession of the property. There was no need for
But the court found merit in petitioner's other contention that evidence having been a demand to be served on him, except to negate any inference that respondent, as
admitted without objection from respondent, the Court of First Instance, pursuant to lessor, had agreed to an extension of the term of the lease under article 1687 of the
Rule 40, section 11, could take cognizance of the counterclaim in the exercise of its Civil Code.
original jurisdiction. Citing article 1678 of the Civil Code, the court held that
petitioner should be reimbursed one-half of what he had spent in building his house. This brings us to petitioner's next point. As earlier stated, petitioner was twice asked
While petitioner claimed that he had spent P12,000 for the improvement of his to quit the premises. The first was on December 16, 1955, but as pointed out in the
house, the appellate court found that the fair market value of the house was P7,000 beginning, the complaint filed afterwards was dismissed for non-suit. The second
and, on the basis of this amount, awarded P3,500 to petitioner. time he was asked to move out was on December 19, 1958. Petitioner insists that
respondent's cause of action must be deemed to have accrued on December 16,
Still not satisfied, petitioner asked the appellate court to reconsider its decision. 1955. But, as already stated, respondent's action is not based on non-profit of rent
When his motion was denied, he appealed to this Court. coupled with a demand; its action is based on the expiration of the term of the lease
and the demand made by it to vacate the premises merely evidences its
It is contended that respondent's complaint is defective and did not vest jurisdiction
determination not to extend the lease. Moreover, even if the action were based on
in the municipal court because it does not state the date when the alleged unlawful
non-payment of rent, the one-year period should be reckoned from the second
detainer started so as to afford a basis for determining whether the case was filed
notice, on the theory that respondent has the right to waive his action based on the
within a year from the accrual of the cause of action. In this connection, it is claimed
first demand and to let the lessee remain in the premises.
that, according to the evidence, petitioner stopped paying rents in July, 1955 and
that it should be from this date that the one-year period should be counted. Nor is there merit in petitioner's last point that he should have been allowed full
reimbursement for what he had spent by applying to this case article 448 of the Civil
To begin with, this case was brought not on the theory that petitioner, as lessee,
Code. It is now settled that article 448, in relation to article 546, applies only to
failed to pay rents, but on the theory that the lease had expired and that respondent
possessors in good faith and since lessees, like petitioner, are not possessors in good
had asked petitioner to vacate the land. Thus, the complaint states that respondent
faith, because they know that their occupation of the premises continues only during
needs the land but that despite his demands petitioner refused to vacate it. The
the life of the lease, they cannot recover the value of their improvements from the
averment that the lease was on a month-to-month basis is equivalent to an
lessor, much less retain the premises until they are reimbursed. Their rights are
allegation that the lease expired at the end of every month.3 It is therefore
governed by article 1678 which allows reimbursement of lessees up to one-half of
immaterial that rents had not been paid since July, 1955, since what made petitioner
the value of their useful improvements. (Lopez, Inc. vs. Philippine & Eastern Trading
liable for ejectment was the expiration of the lease. This being the case, demand to
Co., 98 Phil. 348 [1956]) The Court of Appeals correctly applied article 1678 to this
vacate was unnecessary. As this Court explained in Co Tiamco v. Diaz, 78 Phil. 672
case.
(1946), Rule 70, section 2 requires previous demand only when the action is "for
failure to pay rent due or to comply with the conditions of his lease." Where the WHEREFORE, the decision appealed from is affirmed, with costs against petitioner.
action is to terminate the lease because of the expiration of its term, no such
demand is necessary.4 In the latter case, upon the expiration of the term of the
lease, the landlord may go into the property and occupy it, and if the lessee refuses
to vacate the premises, an action for unlawful detainer may immediately be brought

38
G.R. No. 112734 July 7, 1994
SPOUSES NAZARIO P. PENAS, JR. represented by ELPIDIO R. VIERNES, ATTORNEY-IN-
FACT, petitioners,
vs.
COURT OF APPEALS and LUPO CALAYCAY, respondents.
Mark Anthony B. Ploteña for petitioners.
David B. Agoncillo for private respondent.
PADILLA, J.:
The only issue to be resolved in this ejectment case is whether or not the
Metropolitan Trial Court had jurisdiction over the complaint filed by herein
petitioner-spouses represented by their attorney-in-fact Elpidio R. Viernes.
The undisputed facts of the case as summed up by the trial court and adopted by
respondent Court of Appeals are as follows:
Subject of this controversy [are the] premises identified as 24-B Scout Santiago
Street, Barangay Laging Handa, Quezon City, also identified as 26-B [South] D Street,
Quezon City. It was the object of a written lease contract executed by the late
Nazario Penas in favor of [private respondent] Lupo Calaycay on June 26, 1964, at an
agreed monthly rental of One Hundred Ten (P110.00) Pesos, Philippine Currency.
The written lease contract was on a month to month basis. Nazario Penas, Sr. died
on February 5, 1976 and, thereafter, on June 15, 1976, an extra-judicial settlement
of his estate was executed by his surviving heirs, one of whom is his son, Nazario
Penas, Jr. Likewise, after the death of plaintiff's mother Concepcion P. Penas on
March 2, 1985, her children including [petitioner] Nazario Penas, Jr. executed an
extra judicial settlement of her estate. As time [went] on, the monthly rental on the
subject premises had been gradually increased by the [petitioners], the latest of
which was Six Hundred Ninety One and 20/100 (P691.20) Pesos, Philippine Currency.
In a letter of January 18, 1990, [petitioner]-spouses Penas, through counsel notified
the [private respondent] that effective March 1990, they were terminating the
written month to month lease contract as they were no longer interested to renew
the same and demanded from the latter to vacate the premises in question on or
before February 28, 1990. In the same letter, [petitioners] opted to allow the
defendant to continue occupying the leased premises provided he will agree to
execute a new lease contract for a period of one (1) year at an increased monthly
rental of Two Thousand Five Hundred Pesos (P2,500.00) Pesos, Philippine Currency,
plus two (2) months deposit and, further, gave the [private respondent] up to
February 28, 1990 to decide, otherwise judicial action for unlawful detainer against
the [private respondent] shall ensue. [Petitioners] later finally reduced the monthly
rental to Two Thousand (P2,000.00) Pesos, Philippine Currency, only.
[Private respondent] failed to abide by the demand of the [petitioners]. However, he
continued staying on the leased premises and effective March 1990, he deposited
the monthly rentals in the subject premises with the PNB in his name ITF (in trust for)
spouses Lucila and Nazario Penas, Jr. under Account No. 688930. Prior to such
deposit, [private respondent] together with others, in a letter of March 26, 1990,
informed the [petitioners], inter alia, that since [petitioners'] representative refused
to accept the rentals, he will deposit the same with a reputable bank and he will
[hold] the same intact for the [petitioners]. There was no instance that [petitioners]
manifested any desire to withdraw the same deposit in the bank.
On August 10, 1992, plaintiffs through counsel sent another letter to the defendant
to vacate the subject premises and to pay back rental arrearages in the sum of Two
Thousand (P2,000.00) Pesos, Philippine Currency, per month from March 1990 in the
total sum of Sixty Thousand (P60,000.00) Pesos, Philippine Currency, which
defendant failed to satisfy.
Accordingly, on September 25, 1992, after the corresponding Certification to File
Action was issued by Barangay Laging Handa, Quezon City, [petitioners] filed the
present suit for unlawful detainer on the grounds of termination of the month to
month lease contract and failure of the defendant to execute a new lease agreement
with increased rentals. [Petitioners] tried to impress the Court that after they [had]
agreed [to] a new monthly rental of Two Thousand (P2,000.00) Pesos, Philippine
Currency, [private respondent] refused to enter into a new contract and insisted in
paying at a lower rate; that they gave defendant allowance of more than one (1) year
within which to sign a new contract of lease but still he refused to do so; that even if
conciliation before the barangay is unnecessary as [petitioners] reside abroad, their
attorney-in-fact referred the case to the barangay level. (reference to Annexes
omitted) 1
39
The parties were required to submit their respective position papers after which the
Metropolitan Trial Court, Branch 33 of Quezon City rendered a decision dated 16
March 1993 dismissing herein petitioners' complaint for lack of jurisdiction. The trial
court based its decision on the finding that the complaint was filed more than one
(1) year after private respondent began unlawfully occupying the premises.
On appeal to the Regional Trial Court, the trial court decision was upheld, the RTC
ruling that herein petitioners' remedy was converted from an actio de mero hecho to
an accion publiciana since more than one (1) year had elapsed from the demand
upon defendants to vacate. The Regional Trial Court concluded that herein
petitioners could initiate a proper complaint with the Regional Trial Court.
Respondent Court of Appeals in a decision * in CA G.R. SP No. 31480 dated 19
November 1993 upheld the RTC. The Court of Appeals ruled that since herein
petitioners were not collecting the rentals being deposited by private respondent,
there no longer was any lease contract between the parties for two (2) years since
the first letter of petitioners to private respondent. The Court of Appeals thus agreed
that the proper remedy of the petitioners is to file an action for recovery of
possession in the Regional Trial Court.
We do not agree with the decision of the Court of Appeals, and hence set it aside.
Petitioners correctly cite our ruling in Sy Oh v. Garcia 2 upholding the established rule
that the one (1) year period provided for in section 1, Rule 70 of the Rules of Court
within which a complaint for unlawful detainer can be filed should be counted from
the LAST letter of demand to vacate, the reason being that the lessor has the right to
waive his right of action based on previous demands and let the lessee remain
meanwhile in the premises. 3
In the present case, it is of note that the first demand letter addressed by petitioners
to private respondent gave the latter the option to either vacate the premises on or
before 28 February 1990 or agree to execute a new lease contract for one (1) year at
an increased rental rate of P2,500 per month. In Vda. de Murga v. Chan 4 we held
that:
The notice giving the lessee the alternative either to pay the increased rental or
otherwise vacate the land is not the demand contemplated by the Rules of Court in
unlawful detainer cases. When after such notice, the lessee elects to stay, he thereby
merely assumes the new rental and cannot be ejected until he defaults in said
obligation and necessary demand is first made.
The facts of this case do not warrant a departure from said settled doctrine. It should
be noted that even if the private respondent was depositing rentals in trust for the
petitioners, what was being deposited were rentals at the old rate, which petitioners
were not bound to accept or withdraw. When private respondent elected to remain
in the premises after petitioners had sent him the letter of 18 January 1990 giving
him the option to vacate by 28 February 1990 or to sign a new lease contract for one
(1) year at an increased rental rate of P2,500.00 (later reduced to P2,000.00) a
month, he assumed the new rental rate and could be ejected from the premises only
upon default and by a proper demand from the petitioners. The demand was made
on 10 August 1992, followed by the action for unlawful detainer on 25 September
1992.
WHEREFORE, based on the foregoing, the decision of the Court of Appeals in CA G.R.
SP No. 31480 is hereby SET ASIDE and a new decision rendered:
1. Ordering private respondent Lupo Calaycay to immediately vacate the premises
located at 24-B Scout Santiago Street, Barangay Laging Handa, Quezon City.
2. Ordering private respondent Lupo Calaycay to pay back rentals in the amount of
Two Thousand (P2,000.00) Pesos per month from March 1990 until he finally vacates
the leased premises.
3. Ordering private respondent to pay Ten Thousand (P10,000.00) Pesos as
attorney's fees.
Costs against private respondent.
SO ORDERED.
40
G.R. No. 76656 December 11, 1992
SPOUSES EUTIQUIANO CLUTARIO and ARACELI CLUTARIO, petitioners,
vs.
HON. COURT OF APPEALS, HON. GEORGE C. MACLI-ING, RTC Judge of Quezon City,
Branch C (100), and SPOUSES MELQUIADES GANDIA and MARIA V. GANDIA,
respondents.
ROMERO, J.:
Private respondents, the Spouses Melquiades Gandia and Maria V. Gandia, are the
owners of a two-storey residential apartment located at No. 56 Liberty St., Murphy,
Cubao, Quezon City. Since 1961, while private respondents have been occupying the
upper storey of the house, petitioners have been staying on the ground floor by
virtue of a verbal lease agreement for a monthly rental of P150.00.
On May 9, 1980, private respondents, through their counsel, wrote a letter to the
petitioners giving them ninety (90) days to vacate the premises. According to them,
due to their advanced age and failing health, they have decided to occupy the entire
apartment, including the ground floor leased to petitioners. Because petitioners did
not heed the demand letter, private respondents brought the matter to the
Katarungan Pambarangay for settlement, but this did not meet with success.
Another demand letter was sent by private respondents to petitioners on January
20, 1981.
In the meantime, it appears that from August 1980, petitioners were in arrears in the
payment of their rentals. On March 4, 1981, private respondents filed a complaint
for ejectment against petitioner Araceli Clutario1 before the Metropolitan Trial Court
(MTC) of Quezon City citing the following two grounds: (1) their need for the
premises; and (2) non-payment of rentals by petitioners from August 1980. Pending
the proceedings before the MTC, petitioners paid the back rentals from August 1980
until May 1981.
After trial, the MTC rendered judgment 2 on January 16, 1984 dismissing the
complaint on the ground that private respondents "failed to support their causes of
action with substantial evidence."3
Private respondents then filed an appeal with the Regional Trial
Court (RTC) of Quezon City. On March 29, 1985, respondent Judge George C. Macli-
ing rendered a well-written decision reversing the MTC judgment. Respondent Judge
ruled that petitioners' non-payment of rentals for more than three months and
private respondents' genuine need for the leased premises are sufficient causes for
petitioners' ejectment. The dispositive portion of the RTC decision reads:
WHEREFORE, premises considered, the judgment appealed from is hereby REVERSED
and SET ASIDE, and in lieu thereof, another one is rendered and entered in favor of
the appellants and against the appellees:
1. Ordering the defendants-appellees and all persons claiming rights under them to
vacate the premises, identified as the Ground Floor of No. 56 Liberty Avenue,
Murphy, Cubao, Quezon City, and restore possession thereof to plaintiffs-appellants.
2. Ordering defendants-appellees to pay rental arrearages from June, 1981, at the
rate of P150.00 per month, until such arrearages shall have been fully paid and the
premises vacated and possession thereof restored to plaintiffs-appellants.
3. Ordering defendants-appellees to pay P2,000.00 as and for attorney's fees; and to
pay the costs.
SO ORDERED.4
It was then petitioners' turn to impugn this judgment by filing a petition for review
before the Court of Appeals. In a decision dated September 18, 1986, 5 the
respondent Court of Appeals affirmed the RTC judgment but deleted the award of
attorney's fees to private respondents. Petitioners elevated the case before this
Court, on a petition for review under Rule 45 of the Rules of Court, seeking the
reversal of the Court of Appeals' decision affirming the RTC ruling that they can be
ejected by their lessors, the private respondents.
The petition is without merit.
B.P. Blg. 25 (1979), which was the governing law at the time of the filing of the
complaint and which the parties had to rely on, provides, in section 5, six (6) grounds
for ejectment.6 In seeking to oust petitioners from the leased premises, private
respondents invoke two of those six grounds, namely: (1) arrears in payment of rent
for three (3) months at any one time;7 and (2) need of the lessors to repossess their
property for their own use or for the use of any immediate member of their family as
41
residential unit. 8 Petitioners contend that private respondents cannot avail of either
ground.
No longer disputed is the rule that non-payment of rentals is a sufficient ground for
ejectment.9 Under sec. 5 (b) of B.P. Blg. 25 (1979), the arrears in rent payment must
be for at least three (3) months. Petitioners started defaulting on their payments in
August 1980. On May 15, 1981, they paid P1,500.00 for their rents for the period
August 1980 to May 15 1981 at the rate of P150.00 per month. By then, they had
been in arrears for nine (9) months. However, petitioners contend that private
respondents, by accepting the payment of the back rentals, waived their non-
payment of rentals for more than three (3) months as a ground for ejectment.
The contention is without merit.
Case law is to the effect that the acceptance by the lessor of the payment by the
lessee of the rentals in arrears does not constitute a waiver of the default in the
payment of rentals as a valid cause of action for ejectment.10 The Court notes that
when petitioners paid the back rentals on May 15, 1981, private respondents had
already filed the complaint for ejectment earlier, to be specific, on March 4, 1981.
The conduct of private respondents subsequent to their acceptance of the back
rentals belies any intention to waive their right to eject petitioners as a result of the
latter's failure to pay the rent for more than three (3) months. They did not enter
into an amicable settlement with petitioners. Neither did they notify the trial court of
their intention to have the complaint dismissed. Instead, they participated actively in
the proceedings before the MTC during all the time that the case dragged on for
almost three years. 11 When the MTC decided adversely against them, private
respondents appealed the judgment to the RTC. Not only have they participated
earnestly in all subsequent proceedings even after they obtained favorable
judgments from the RTC and the Court of Appeals, but they have likewise been
consistent in their position that petitioners should be ejected, not only because they
need the leased premises, but also because of petitioners' default in the payment of
rentals for more than three (3) months.
In light of the surrounding circumstances of the case, as well as the prevailing
jurisprudence, the Court rules that the acceptance by private respondents of the
petitioners-lessees' back rentals did not constitute a waiver or abandonment of their
cause of action for ejectment against the latter.
Proof of any one of the factors enumerated in section 5 of B.P. Blg. 25 (1979) is
sufficient cause for judicial ejectment of a lessee. Having proved one of such
grounds, i.e., arrears in payment of rent for three (3) months at any one time, private
respondents may legally eject petitioners without having to prove the other grounds
for ejectment. Nevertheless, to bolster their action for ejectment, private
respondents invoked in their complaint a second ground for ejectment, namely, their
need for the leased premises. 12
Petitioners are bound by the established jurisprudence that under B.P. Blg. 25
(1979), the need by the lessor of the leased premises for his own use or that of his
immediate family is a valid ground for ejectment. 13 They, however, submit that this
ground for ejectment is not available to private respondents who own, apart from
the disputed premises, three other apartment units located at Nos. 56-A, 56-B and
56-C Liberty St., Murphy, Cubao, Quezon City, at least one of which is allegedly
available for occupancy by private respondents.
Indeed, for the lessor to be able to validly eject the lessee on the ground of need for
the leased property, it must be shown that there is no other available residential unit
to satisfy that need. 14 The non-availability must exist at the time of the demand by
the lessor on the lessee to vacate the property. 15 In the instant case, petitioners
allege that the other apartment units of private respondents are vacant and available
to the latter for occupancy.16 Private respondents deny this allegation, claiming that
the other units were occupied when they gave notice to the petitioners to vacate the
disputed premises, and remain so occupied until now.17 None of the three courts
which have already adjudicated on the controversy gave credence to petitioners'
allegation. The MTC which decided in petitioners' favor did not make a finding that
the other apartment units of private respondents were available for occupancy by
the latter. On the contrary, the respondent Court of Appeals ruled that "the other
apartments of private respondents were tenanted." 18 The Court finds no cogent
reason to disturb this finding.
The MTC, in deciding in favor of petitioners, ruled that private respondents did not
need the disputed premises which is the ground floor of the apartment unit leased
to petitioners, because they were already occupying the upper floor of the unit. The
relevant portion of the MTC decision reads:
On this score, the evidence is clear that the plaintiffs, though owners of the
residential house identified as No. 56 Liberty Avenue, Murphy, Quezon City,
occupying the upper floor thereof, are the only persons living on this upper floor of
42
the house. The only reason advanced by them for needing to repossess the ground
floor or lower part of the house occupied by the defendant, is because the plaintiffs
are aging and sickly, as according to the plaintiffs' letter (Exh. "B") to the defendant,
plaintiffs "personally need that lower portion of the house for personal use and
occupancy since they are getting older and aggravated by their poor health, they get
easily tired in going up and downstairs." Obviously, plaintiffs' need of the lower
portion of the house is for convenience. It is the view of this Court that when the
framers of Batas Pambansa Blg. 25 included "need of the premises" as a ground for
judicial eviction, personal convenience is not intended, because the law states clearly
that the repossession of the property for the use of the owner/lessor (or immediate
member) must concur with the other requisites, one of which is that the owner /
lessor does not own any other residential unit.
Plaintiffs' position therefore, on this ground, is not only weak but more so not in
accord with the spirit, intent and letter of Batas Pambansa Blg. 25. It may be true
that plaintiffs are sickly and aging but their physical condition is not a legal argument
to effect eviction of the-defendant. 19
In the case at bar, it appears that the decision of private respondents to occupy both
the lower and upper portions of the property sprang not only from mere
convenience, but from necessity as well, due to their advanced age and the poor
health of respondent Melquiades Gandia. While the upper portion of the premises
may have been sufficient to satisfy private respondents' residential needs in 1961
when they leased the lower portion to petitioners, it no longer sufficed in 1980 or
nineteen (19) years later, when they served the notice to vacate, their personal
circumstances having drastically changed.
WHEREFORE, the Petition is DENIED and the Decision of the Court of Appeals
AFFIRMED.
SO ORDERED.

The need for the leased premises by the lessor as a valid ground for ejectment has
already been given a liberal interpretation in Caudal v. Court of Appeals, 20 where it
was held that the conversion of the leased property into a servants' quarters was a
legitimate need within the purview of sec. 5 (c) of B.P. Blg. 25 (1979). The Court,
speaking through then Chief Justice Marcelo B. Fernan, made the following
statements:

Observe that the law does not strictly confine the meaning of the word "residence"
mainly for habitation purposes as restrictedly interpreted by petitioner. In a way, the
definition admits a measure of liberality, albeit limited, since a residence may also be
the site of a home industry, or a retail store or be used for business purposes so long
as it is principally used for dwelling purposes. The law in giving greater importance to
the abode being used principally for dwelling purposes, has set the limitation on the
maximum amount of capitalization to P5,000.00, which is small by present
standards.

Thus, if an abode can be used for limited business purposes, we see no reason why it
cannot be used as an abode for persons rendering services usually necessary or
desirable for the maintenance and enjoyment of a home and who personally minister
to the personal comfort and convenience of the members of the houses. 21

43
THIRD DIVISION 3. REMEDIAL LAW; SPECIAL CIVIL ACTION; UNLAWFUL DETAINER; PAYMENT OF BACK
RENTALS DO NOT AUTOMATICALLY RESTORE THE CONTRACT OF LEASE WITHOUT
[G.R. No. 50335. August 7, 1989.] LESSORS CONSENT; CASE AT BAR. — Respondent formally demanded from the
petitioner, the following: (a) to pay the back rentals, and (b) to vacate the premises.
FLORENTINO CURSINO, Petitioner, v. HON. PEDRO JL. BAUTISTA (District Judge, CFI, Undoubtedly, petitioner’s belated payments of his back rentals do not automatically
Branch III, Pasay City), HON. NICANOR J. CRUZ, JR. (Presiding Judge, Mun. Court of restore the contract of lease without private respondent’s consent. The terms of the
Parañaque, MM), and MARIA JAMES, Respondents. contract of lease have been violated and the lessor-owner has the unquestionable
right to withdraw from said contract or agreement whether oral or written. This
Court has consistently ruled that "It is the landlord’s demand for tenant to vacate the
premises, when the tenant has failed to pay the rents on time and tenant’s refusal or
failure to vacate, which make unlawful withholding of possession (Canaynay v.
SYLLABUS
Sarmiento, 79 Phil. 36 [1947]; Desbarats v. Vda. de Laureano, 18 SCRA 116 [1966];
Balucanag v. Francisco, 122 SCRA 498 (1983]). In fact, this Court stressed: "That
consent, no matter how long it may last makes lawful tenants possession. Only when
that consent is withdrawn and the owners demands tenant to leave the property is
1. CIVIL LAW; CONTRACTS; CONTRACT OF LEASE; EFFECT OF PRESIDENTIAL DECREE the owner’s right of possession asserted and the tenant’s refusal or failure to move
NO. 20 ON ARTICLE 1673 OF THE CIVIL CODE; PRESIDENTIAL DECREE NO. 20 out makes his possession unlawful because it is violative of the owner’s preferential
SUSPENDS PARAGRAPH I OF ARTICLE 1673 AS A GROUND FOR EJECTMENT NOT THE right of possession" (Canaynay v. Sarmiento, supra). In the case at bar, respondent-
OTHER PROVISIONS OF THE CIVIL CODE AND THE RULES OF COURT. — Under lessor did not consent to petitioner’s possession of the leased premises after the
Presidential Decree No. 20, it is very clear that only paragraph (1) of Article 1673 of latter’s default in the payment of the monthly rents. On the contrary, respondent
the Civil Code which refers to expiration of leases of dwelling unit or land for an demanded that petitioner pay the back rental and vacate the premises. The refusal
indefinite period, as ground for ejectment, is suspended but not the other provisions of the petitioner to vacate the premises after demand, makes his withholding of
of the Civil Code and the Rules of Court. In fact, this Court has categorically ruled that possession unlawful.
P.D. No. 20 suspended ejectment when the lease is for an indefinite period. It did not
suspend ejectment on other grounds like lack of payment of the rental stipulated
(Velez v. Avelino, 127 SCRA 602 (1984]).

DECISION
2. ID.; ID.; ID.; FAILURE TO COMPLY WITH THE REQUISITE OF ARTICLE 1256 OF THE
CIVIL CODE (CONSIGNATION) BELIES LESSEE’S CLAIM OF NON-DEFAULT IN PAYMENT
OF RENTALS; CASE AT BAR. — Petitioner’s insistence that he has not defaulted in the
payment of rents because it was private respondent who refused to accept the
same, will not help the former. As ruled by this Court, "The failure of the owners to BIDIN, J.:
collect, or their refusal to accept the rentals are not valid defenses. Article 1256 of
the Civil Code provides that if the creditor to whom tender of payment has been
made refuses without just cause to accept it, the debtor shall be released from
responsibility by the consignation of the thing or sum due." (Velez v. Avelino, supra).
This is a petition for review on certiorari seeking to reverse and set aside (a) the
Petitioner failed to comply with the requisite consignation.
decision of the then Court of First Instance of Rizal ** (now Regional Trial Court)

44
dated October 30, 1978 in Civil Case No. Pq-6364-P affirming in toto the decision of detainer dated December 27, 1977 was filed by respondent before the then
the then Municipal Court of Parañaque *** (now Metropolitan Trial Court) dated Municipal Court of Parañaque. After hearing, the court rendered its decision (Rollo,
April 17, 1978 in Civil Case No. 3809 entitled Maria James v. Florentino Cursino", pp. 32-38) dated April 17, 1978 in favor of private respondent (the plaintiff herein),
ordering defendant(herein petitioner) and all persons claiming under him to vacate the dispositive portion of which reads:jgc:chanrobles.com.ph
plaintiffs (herein private respondent) leased premises and to pay monthly rentals,
attorney’s fees and costs of suit, and (b) the order of the then Court of First Instance "WHEREFORE, Decision is hereby rendered in favor of the plaintiff and against the
dated February 28, 1979 denying petitioner’s motion for reconsideration. defendant, ordering the latter and all persons claiming under him to vacate plaintiffs
premises situated at 17 De Marzo Street, Baclaran, Parañaque, Metro Manila;
The factual background of this case as quoted from the decision of the Court of First ordering the defendant to pay plaintiff the amount of Pl00.00 representing rental for
Instance of Rizal, Branch III, Pasay City, is as follows:jgc:chanrobles.com.ph the month of March and to pay the same monthly rental of P100.00 commencing
April, 1978 until such time that defendant and all persons claiming under him shall
"From the record of this case, it appears that plaintiff is the lawful owner and lessor have completely vacated plaintiffs premises; ordering the defendant to pay plaintiff
of the premises located at 4143 17 de Marzo St., Baclaran, Parañaque, leased by the amount of ONE THOUSAND (P1,000.00) PESOS as and for attorney’s fees and to
defendant at a monthly rental of Pl00.00, payable within the first five days of each pay the costs of this suit." (Rollo, p. 38)
month; that defendant defaulted in the payment of his monthly rental for the
months of October, November and December, 1977; that defendant sent two (2) Not satisfied with the decision, petitioner appealed to the then Court of First
postal money orders, both dated December 21, 1977, one bearing Money Order No. Instance of Rizal which on October 30, 1978, rendered a decision (Rollo, pp. 40-43)
1162-55 in the amount of P200.00 as payment for the months of October and affirming in toto the decision of the municipal court with double costs against
November, 1977, and the other bearing Money Order No. E-1162-56 in the amount petitioner.
of P100.00 for the December 1977 rental; that prior to the sending of said postal
money orders, plaintiff on December 14, 1977 demanded that defendant pay the Petitioner moved for the reconsideration of the decision (Rollo, p. 44-53), but the
back rental and vacate the premises at 4143 17 de Marzo St., Baclaran, Parañaque, same was denied with treble costs against petitioner in an order dated February 28,
‘within a period of five (5) days from receipt of this letter’ (Exh.’A’); that despite the 1979 (Rollo, pp. 54-55).
formal demand, defendant failed and refused to vacate the subject premises without
justifiable cause; that by reason thereof, plaintiff was constrained to secure the Hence, this instant petition filed on May 15, 1979 (Rollo, pp. 10-23).
services of counsel and incurred expenses in this litigation.
Petitioner submits the following reasons for the allowance of the
"The defendant contends that he has not defaulted in the payment of rents and that petition:chanrob1es virtual 1aw library
it was the plaintiff who refused to accept the same. As a matter of fact, defendant
claims that he sent Postal Money Order No. E-1162-55 dated December 21, 1977 in FIRST REASON
the amount of P200.00 as rental payment for the months of October and November
1977, and another Postal Money Order No. E-1162-56 also dated December 21, LIKE THE TRIAL COURT, RESPONDENT HON. PEDRO JL. BAUTISTA OF THE COURT OF
1977 in the amount of P100.00 for the December 1977 rental. It is further FIRST INSTANCE OF RIZAL, BRANCH III COMMITTED GRAVE ERROR IN THE
contended that since the lease of the subject dwelling place is only for Pl00.00 a INTERPRETATION AND APPLICATION OF SECTION 2, RULE 70, RULES OF COURT.
month, it is ‘protected under Section 1 and 4 of Presidential Decree No. 20.’" (Rollo,
pp. 40-41). SECOND REASON

Petitioner did not vacate the premises as demanded and so a complaint for unlawful RESPONDENT JUDGE BAUTISTA COMMITTED GRAVE ERROR IN RULING THAT IRE
45
PROVISIONS OF PRESIDENTIAL DECREE NO. 20, MORE SPECIFICALLY PARAGRAPHS 1 provisions of the Civil Code and the Rules of Court. In fact, this Court has
and 4, ARE NOT APPLICABLE TO THE CASE AT BAR. categorically ruled that P.D. No. 20 suspended ejectment when the lease is for an
indefinite period. It did not suspend ejectment on other grounds like lack of payment
THIRD REASON of the rental stipulated (Velez v. Avelino, 127 SCRA 602 (1984]).

RESPONDENT JUDGE BAUTISTA COMMITTED GRAVE ERROR IN RULING THAT
PARAGRAPH 2, ARTICLE 1673 OF THE CIVIL CODE OF THE PHILIPPINES IS THE
APPLICABLE LAW IN THE CASE AT BAR." (Rollo, p.14)
In a resolution dated June 20, 1979 (Rollo, p. 62), the petition was given due course
and both parties were required to submit simultaneous memoranda. On November
5, 1979, respondent Maria James submitted her memorandum (Rollo, pp. 70-73),
while in a manifestation dated October 31, 1979 (Rollo, pp. 74-75), petitioner
adopted the petition as his memorandum. In the resolution of November 19, 1979
(Rollo, p. 77), the Court resolved to declare this case submitted for decision.
The issue is whether or not respondent Maria James still has a cause of action
against the petitioner after she received and accepted the rentals for October,
November and December 1977 at the time of filing of the instant case. Otherwise
stated, is the possession of the lessee legitimized by the lessor’s acceptance of the
payment of back rentals?
The answer is in the negative.
Private respondent exercised two unquestionable prerogatives of the owner-lessor
when a tenant-lessee defaults in the payment of the rent, i.e., to demand that: (a)
the back rentals be paid, and (b) the premises be vacated.
The records show that petitioner has defaulted in the payment of his rentals for the
months of October, November and December, 1977; that although he paid the same
on December 22, 1977 after receipt of private respondent’s demand letter, he has
not paid them on time, the due date being on the first five (5) days of each month
(Rollo, p. 58); and that petitioner refused to vacate the premises on the ground that
he is protected under Sections 1 and 4 of Presidential Decree No. 20 (Rollo, p. 41).
Under Presidential Decree No. 20, it is very clear that only paragraph (1) of Article
1673 of the Civil Code which refers to expiration of leases of dwelling unit or land for
an indefinite period, as ground for ejectment, is suspended but not the other
In the same manner, petitioner’s insistence that he has not defaulted in the payment
of rents because it was private respondent who refused to accept the same, will not
help the former. As ruled by this Court, "The failure of the owners to collect, or their
refusal to accept the rentals are not valid defenses. Article 1256 of the Civil Code
provides that if the creditor to whom tender of payment has been made refuses
without just cause to accept it, the debtor shall be released from responsibility by
the consignation of the thing or sum due." (Velez v. Avelino, supra). Petitioner failed
to comply with the requisite consignation.
But petitioner further argues that in spite of his payment of back rentals within five
days from receipt of the demand letter, private respondent filed the complaint for
ejectment which allegedly is contrary to the provision of Section 2, Rule 70 of the
Rules of Court.
Such argument is untenable.
It will be recalled that private respondent formally demanded from the petitioner,
the following: (a) to pay the back rentals, and (b) to vacate the premises.chanrobles
lawlibrary : rednad
Petitioner was able to pay the back rentals but refused to vacate the premises.
Undoubtedly, petitioner’s belated payments of his back rentals do not automatically
restore the contract of lease without private respondent’s consent. The terms of the
contract of lease have been violated and the lessor-owner has the unquestionable
right to withdraw from said contract or agreement whether oral or written. This
Court has consistently ruled that "It is the landlord’s demand for tenant to vacate the
premises, when the tenant has failed to pay the rents on time and tenant’s refusal or
failure to vacate, which make unlawful withholding of possession (Canaynay v.
Sarmiento, 79 Phil. 36 [1947]; Desbarats v. Vda. de Laureano, 18 SCRA 116 [1966];
Balucanag v. Francisco, 122 SCRA 498 (1983]). In fact, this Court stressed: "That
consent, no matter how long it may last makes lawful tenants possession. Only when
that consent is withdrawn and the owners demands tenant to leave the property is
the owner’s right of possession asserted and the tenant’s refusal or failure to move
46
out makes his possession unlawful because it is violative of the owner’s preferential
right of possession" (Canaynay v. Sarmiento, supra). In the case at bar, respondent-
lessor did not consent to petitioner’s possession of the leased premises after the
latter’s default in the payment of the monthly rents. On the contrary, respondent
demanded that petitioner pay the back rental and vacate the premises. The refusal
of the petitioner to vacate the premises after demand, makes his withholding of
possession unlawful.

WHEREFORE, the assailed decision and order of the then Court of First Instance of
Rizal is Affirmed in toto.

47
G.R. No. 77648 August 7, 1989 Petitioner vs. Hon. Conrado T. Limcaoco, Presiding Judge, Regional Trial Court of
Manila, Branch Ederlina Navalta, et. al., respondents.
CETUS DEVELOPMENT, INC., petitioner,
vs. The following facts appear in the records:
COURT OF APPEALS and ONG TENG, respondents.
The private respondents, Ederlina Navalta, Ong Teng, Jose Liwanag, Leandro Canlas,
G.R. No. 77647 August 7, 1989 Victoria Sudario, and Flora Nagbuya were the lessees of the premises located at No.
512 Quezon Boulevard, Quiapo, Manila, originally owned by the Susana Realty. These
CETUS DEVELOPMENT, INC., petitioner, individual verbal leases were on a month-to month basis at the following rates:
vs. Ederlina Navalta at the rate of P80.50; Ong Teng at the rate of P96.10; Jose Liwanag
COURT OF APPEALS and EDERLINA NAVALTA, respondents. at the rate of P40.35; Leandro Canlas at the rate of P80.55; Victoria Sudario at the
rate of P50.45 and Flora Nagbuya at the rate of P80.55. The payments of the rentals
G.R. No. 77649 August 7, 1989
were paid by the lessees to a collector of the Susana Realty who went to the
CETUS DEVELOPMENT, INC., petitioner, premises monthly.
vs.
Sometime in March, 1984, the Susana Realty sold the leased premises to the
COURT OF APPEALS and JOSE LIWANAG, respondents.
petitioner, Cetus Development, Inc., a corporation duly organized and existing under
G.R. No. 77650 August 7, 1989 the laws of the Philippines. From April to June, 1984, the private respondents
continued to pay their monthly rentals to a collector sent by the petitioner. In the
CETUS DEVELOPMENT, INC., petitioner, succeeding months of July, August and September 1984, the respondents failed to
vs. pay their monthly individual rentals as no collector came.
COURT OF APPEALS and LEANDRO CANLAS, respondents.
On October 9, 1984, the petitioner sent a letter to each of the private respondents
G.R. No. 77651 August 7, 1989 demanding that they vacate the subject premises and to pay the back rentals for the
months of July, August and September, 1984, within fifteen (15) days from the
CETUS DEVELOPMENT, INC., petitioner,
receipt thereof. Immediately upon the receipt of the said demand letters on October
vs.
10, 1984, the private respondents paid their respective arrearages in rent which
COURT OF APPEALS and VICTORIA SUDARIO respondents.
were accepted by the petitioner subject to the unilateral condition that the
G.R. No.77652 August 7, 1989 acceptance was without prejudice to the filing of an ejectment suit. Subsequent
monthly rental payments were likewise accepted by the petitioner under the same
CETUS DEVELOPMENT, INC., petitioner, condition.
vs.
COURT OF APPEALS and FLORA NAGBUYA respondents. For failure of the private respondents to vacate the premises as demanded in the
letter dated October 9, 1984, the petitioner filed with the Metropolitan Trial Court of
Manila complaints for ejectment against the manner, as follows: (1) 105972-CV,
against Ederlina Navalta (2) 105973-CV, against Jose Liwanag; (3) 105974-CV, against
MEDIALDEA, J.: Flora Nagbuya; (4) 105975-CV, against Leandro Canlas; (5) 105976-CV, against
Victoria Sudario and (6) 105977-CV, against Ong Teng.
This is a petition for review on certiorari of the decision dated January 30, 1987 of
the Court of Appeals in CA-GR Nos. SP-07945-50 entitled, "Cetus Development, Inc.,
48
In their respective answers, the six (6) private respondents interposed a common
defense. They claimed that since the occupancy of the premises they paid their
monthly rental regularly through a collector of the lessor; that their non-payment of
the rentals for the months of July, August and September, 1984, was due to the
failure of the petitioner (as the new owner) to send its collector; that they were at a
loss as to where they should pay their rentals; that sometime later, one of the
respondents called the office of the petitioner to inquire as to where they would
make such payments and he was told that a collector would be sent to receive the
same; that no collector was ever sent by the petitioner; and that instead they
received a uniform demand letter dated October 9, 1984.
The private respondents, thru counsel, later filed a motion for consolidation of the
six cases and as a result thereof, the said cases were consolidated in the
Metropolitan Trial Court of Manila, Branch XII, presided over by Judge Eduardo S.
Quintos, Jr. On June 4, 1985, the trial court rendered its decision dismissing the six
cases, a pertinent portion of which reads, as follows:
The records of this case show that at the time of the filing of this complaint, the
rentals had all been paid. Hence, the plaintiff cannot eject the defendants from the
leased premises, because at the time these cases were instituted, there are no
rentals in arrears.
The acceptance of the back rental by the plaintiff before the filing of the complaint,
as in these case, the alleged rental arrearages were paid immediately after receipt of
the demand letter, removes its cause of action in an unlawful detainer case, even if
the acceptance was without prejudice.
x x x.
Furthermore, the court has observed that the account involved which constitutes
the rentals of the tenants are relatively small to which the ejectment may not lie on
grounds of equity and for humanitarian reasons.
Defendants' counterclaim for litigation expenses has no legal and factual basis for
assessing the same against plaintiff.
WHEREFORE, judgment is hereby rendered dismissing these cases, without
pronouncement as to costs.
Defendants' counterclaim is likewise dismissed.
SO ORDERED. (pp. 32-33, Rollo, G.R. No. 77647)
Not satisfied with the decision of the Metropolitan Trial Court, the petitioner
appealed to the Regional Trial Court of Manila and the same was assigned to Branch
IX thereof presided over by Judge Conrado T. Limcaoco (now Associate Justice of the
Court of Appeals).lâwphî1.ñèt In its decision dated November 19, 1985, the Regional
Trial Court dismissed the appeal for lack of merit.
In due time, a petition for review of the decision of the Regional Trial Court was filed
by the petitioner with the Court of Appeals. Said petition was dismissed on January
30, 1987, for lack of merit.
Aggrieved by the decision of the Court of Appeals, petitioner now comes to Us in this
petition, assigning the following errors:
ASSIGNMENT OF ERRORS
I
RESPONDENT COURT OF APPEALS COMMITTED A GRAVE ABUSE OF DISCRETION,
AMOUNTING TO LACK OF JURISDICTION, WHEN IT ERRED IN HOLDING THAT THE
CAUSE OF ACTION FOR UNLAWFUL DETAINER IN THESE CASES DID NOT EXIST WHEN
THE COMPLAINTS WERE FILED BECAUSE PRIVATE RESPONDENTS TENDERED, AND
PETITIONER ACCEPTED, THE PAYMENT OF THE THREE (3) MONTHS RENTAL IN
ARREARS WITHIN THE FIFTEEN (15) DAY PERIOD FROM PRIVATE RESPONDENTS'
RECEIPT OF PETITIONER'S DEMAND LETTERS TO VACATE THE SUBJECT PREMISES
AND TO PAY THE RENTALS IN ARREARS.
II
RESPONDENT COURT OF APPEALS COMMITTED A GRAVEABUSE OF DISCRETION,
AMOUNTING TO LACK OF JURISDICTION COMMITTED A GRAVE WHEN IT ERRED IN
AFFIRMING THE DISMISSAL OF THE COMPLAINTS IN THESE CASES
NOTWITHSTANDING THE EXISTENCE OF VALID GROUNDS FOR THE JUDICIAL
EJECTMENT OF PRIVATE RESPONDENT.
III
RESPONDENT COURT OF APPEALS COMMITTED A GRAVE ABUSE OF DISCRETION,
AMOUNTING TO LACK OF JURISDICTION, WHEN IT ERRED IN HOLDING THAT THESE
49
CASES ARE CLASSIC EXAMPLES TO CIRCUMVENT THE RENT CONTROL LAW. (pp. 164-
165, Rollo, G.R. No. 77647)
The Court of Appeals defined the basic issue in this case as follows: whether or not
there exists a cause of action when the complaints for unlawful detainer were filed
considering the fact that upon demand by petitioner from private respondents for
payment of their back rentals, the latter immediately tendered payment which was
accepted by petitioner.
In holding that there was no cause of action, the respondent Court relied on Section
2, Rule 70 of the Rules of Court, which provides:
Sec. 2. Landlord to proceed against tenant only after demand. — No landlord or his
legal representative or assign, shall be such action against a tenant for failure to pay
rent due or to comply with the conditions of his lease, unless the tenant shall have
failed to pay such rent or comply with such conditions for a period of fifteen (15)
days or five (5) days in case of building, after demand therefor, made upon qqqm
personally, or by serving written notice of such demand upon the person found on
the premises, or by posting such notice on the premises if no persons be found
thereon.
It interpreted the said provision as follows:
.....the right to bring an action of ejectment or unlawful detainer must be counted
from the time the defendants failed to pay rent after the demand therefor. It is not
the failure per se to pay rent as agreed in the contract, but the failure to pay the rent
after a demand therefor is made, that entitles the lessor to bring an action for
unlawful detainer. In other words, the demand contemplated by the above-quoted
provision is not a demand to vacate, but a demand made by the landlord upon his
tenant for the latter to pay the rent due if the tenant fails to comply with the said
demand with the period provided, his possession becomes unlawful and the landlord
may then bring the action for ejectment. (p. 28, , G.R. No. 77647)
We hold that the demand required and contemplated in Section 2, aforequoted, is a
jurisdictional requirement for the purpose of bringing an unlawful detainer suit for
failure to pay rent or comply with the conditions of lease. It partakes of an
extrajudicial remedy that must be pursued before resorting for judicial action so
much so that when there is full compliance with the demand, there arises no
necessity for court action.
As to whether this demand is merely a demand to pay rent or comply with the
conditions of the lease or also a demand to vacate, the answer can be gleaned from
said Section 2. This section presupposes the existence of a cause of action for
unlawful detainer as it speaks of "failure to pay rent due or comply with the
conditions of the lease." The existence of said cause of action gives the lessor the
right under Article 1659 of the New Civil Code to ask for the rescission of the
contract of lease and indemnification for damages, or only the latter, allowing the
contract to remain in force. Accordingly, if the option chosen is for specific
performance, then the demand referred to is obviously to pay rent or to comply with
the conditions of the lease violated. However, if rescission is the option chosen, the
demand must be for the lessee to pay rents or to comply with the conditions of the
lease and to vacate. Accordingly, the rule that has been followed in our
jurisprudence where rescission is clearly the option taken, is that both demands to
pay rent and to vacate are necessary to make a lessee a deforciant in order that an
ejectment suit may be filed (Casilan et al. vs. Tomassi, L-16574, February 28,1964, 10
SCRA 261; Rickards vs. Gonzales, 109 Phil. 423, Dikit vs. Icasiano, 89 Phil.
44).lâwphî1.ñèt
Thus, for the purpose of bringing an ejectment suit, two requisites must concur,
namely: (1) there must be failure to pay rent or comply with the conditions of the
lease and (2) there must be demand both to pay or to comply and vacate within the
periods specified in Section 2, Rule 70, namely 15 days in case of lands and 5 days in
case of buildings. The first requisite refers to the existence of the cause of action for
unlawful detainer while the second refers to the jurisdictional requirement of
demand in order that said cause of action may be pursued.
It is very clear that in the case at bar, no cause of action for ejectment has accrued.
There was no failure yet on the part of private respondents to pay rents for three
consecutive months. As the terms of the individual verbal leases which were on a
month-to-month basis were not alleged and proved, the general rule on necessity of
demand applies, to wit: there is default in the fulfillment of an obligation when the
creditor demands payment at the maturity of the obligation or at anytime
thereafter. This is explicit in Article 1169, New Civil Code which provides that "(t)hose
obliged to deliver or to do something incur in delay from the time the obligee
judicially or extrajudicially demands from them the fulfillment of their obligation."
Petitioner has not shown that its case falls on any of the following exceptions where
demand is not required: (a) when the obligation or the law so declares; (b) when
from the nature and circumstances of the obligation it can be inferred that time is of
50
the essence of the contract; and (c) when demand would be useless, as when the their rentals as the delay in paying the same was not imputable to them. Rather, it
obligor has rendered it beyond his power to perform. was attributable to petitioner's omission or neglect to collect.

The demand required in Article 1169 of the Civil Code may be in any form, provided
that it can be proved. The proof of this demand lies upon the creditor. Without such
demand, oral or written, the effects of default do not arise. This demand is different
from the demand required under Section 2, Rule 70, which is merely a jurisdictional
requirement before an existing cause of action may be pursued.
The facts on record fail to show proof that petitioner demanded the payment of the
rentals when the obligation matured. Coupled with the fact that no collector was
sent as previously done in the past, the private respondents cannot be held guilty of
mora solvendi or delay in the payment of rentals. Thus, when petitioner first
demanded the payment of the 3-month arrearages and private respondents lost no
time in making tender and payment, which petitioner accepted, no cause of action
for ejectment accrued. Hence, its demand to vacate was premature as it was an
exercise of a non-existing right to rescind.
In contradistinction, where the right of rescission exists, payment of the arrearages
in rental after the demand to pay and to vacate under Section 2, Rule 70 does not
extinguish the cause of action for ejectment as the lessor is not only entitled to
recover the unpaid rents but also to eject the lessee.
Petitioner also argues that neither is its refused to accept the rentals a defense for
non-payment as Article 1256 provides that "[i]f the creditor to whom the tender of
payment has been made refuses without just cause to accept it, the debtor shall be
released from responsibility by the consignation of the thing due." It bears emphasis
that in this case there was no unjustified refusal on the part of petitioner or non-
acceptance without reason that would constitute mora accipiendi and warrant
consignation. There was simply lack of demand for payment of the rentals.
In sum, We hold that respondent Court of Appeals did not commit grave abuse of
discretion amounting to lack of jurisdiction in its conclusion affirming the trial court's
decision dismissing petitioner's complaint for lack of cause of action. We do not
agree, however, with the reasons relied upon.
ACCORDINGLY, the petition for review on certiorari is hereby DENIED for lack of
merit and the decision dated January 30, 1987 of respondent Court of Appeals is
hereby AFFIRMED.
SO ORDERED.

Petitioner correctly argues that acceptance of tendered payment does not constitute
a waiver of the cause of action for ejectment especially when accepted with the
written condition that it was "without prejudice to the filing of an ejectment suit".
Indeed, it is illogical or ridiculous not to accept the tender of payment of rentals
merely to preserve the right to file an action for unlawful detainer. However, this line
of argument presupposes that a cause of action for ejectment has already accrued,
which is not true in the instant case.

Petitioner likewise claims that its failure to send a collector to collect the rentals
cannot be considered a valid defense for the reason that sending a collector is not
one of the obligations of the lessor under Article 1654. While it is true that a lessor is
not obligated to send a collector, it has been duly established that it has been
customary for private respondents to pay the rentals through a collector. Besides
Article 1257, New Civil Code provides that where no agreement has been designated
for the payment of the rentals, the place of payment is at the domicile of the
defendants. Hence, it could not be said that they were in default in the payment of

51
G.R. No. 75676 August 29, 1990
MANUEL CO KENG KIAN, petitioner,
vs.
HONORABLE INTERMEDIATE APPELLATE COURT (Fourth Special Cases Division) and
PLAZA ARCADE, Inc., respondents.
Rogelio L. Orio for petitioner.
Perfecto V. Fernandez for private respondent.
FERNAN, C.J.:
The legal issue raised in this petition is whether the notice to vacate required to be
served on the lessee under Section 2, Rule 70 of the Revised Rules of Court in order
to confer jurisdiction on the Metropolitan Trial Court in an action for ejectment, may
be served by registered mail.
On February 23, 1982, a complaint for ejectment against petitioner Manuel Co Keng
Kian was filed by private respondent Plaza Arcade, Inc., alleging that despite the
expiration of the written contract of lease over a portion of the ground floor of the
former Manila Times Building, petitioner refused to vacate the premises and to pay
the monthly rentals notwithstanding receipt of several letters of demand, the last of
which was sent to petitioner by registered mail.
During the pendency of the trial before the Metropolitan Trial Court of Manila or on
August 27, 1982, petitioner voluntarily vacated the disputed premises, turning over
the key to the clerk of court but without paying the accrued rent.
On May 17, 1984, the inferior court rendered its judgment dismissing the ejectment
case for lack of jurisdiction. It refused to give probative value to the three letters of
demand to vacate which were all sent to petitioner and which he refused to receive.
The court held that since none of the demand letters was served (1) personally, or
(2) by written notice of such demand upon a person found on the premises, or (3) by
posting such notice on the premises if no person can be found thereon pursuant to
the provisions of Section 2, Rule 70 of the Rules of Court, there was no valid demand.
If none was made, the case came within the jurisdiction of the Regional Trial Court
and not the Metropolitan Trial Court. Whereupon, it ordered Plaza Arcade, Inc. to
pay petitioner P5,000.00 as attorney's fees and another P5,000.00 as moral and
exemplary damages.
Plaza Arcade, Inc. appealed to the Regional Trial Court which initially reversed the
decision of the Metropolitan Trial Court, but on motion for reconsideration by
petitioner, affirmed the dismissal of the ejectment case in its order of October 9,
1985. 1
A petition for review was filed with the then Intermediate Appellate Court. In its
decision dated July 3, 1988 the Appellate Court overturned the appealed order of the
trial court which had earlier sustained the dismissal of the ejectment case. Motion
for reconsideration having been denied, the aforesaid decision of the Appellate
Court was elevated to this Court on a petition for review on certiorari.
In reversing the dismissal order, the Appellate Court took the lower courts to task for
taking a rather constricted view of Section 2, Rule 70, and declaring that the service
of demand letters to vacate on the lessee is strictly limited to the three (3) modes
enumerated therein. They failed to note the common practice of serving said notices
on the tenant by registered mail with return card so that the registry receipt and the
receipt thereof by the addressee through the return card could be presented in
evidence to prove the fact of delivery, in the event of a litigation.
We agree and in our opinion the facts in the instant case indicate personal service on
the lessee. In arriving at this conclusion, we have been greatly aided by respondent's
citation of American cases which, by and large, represents a practical, if not realistic,
approach to the problem.
In the cases of Nunlist vs. Motter,2 and Gehring vs. Swoll 3 the Court held that where
the notice to leave the premises is transmitted by registered mail with a return card
and thereafter the receipt bearing the signature of the defendant was returned, a
prima facie case is established of the fact of delivery of said notice to the defendant
personally by the Postal Office Department although he refused to accept the same.
4
Indeed, notice by registered mail is considered an effective service on the person
concerned. It cannot be avoided by the mere expediency of declining to accept
delivery after notification thereof. The service is deemed complete regardless of
such refusal to accept if the addressee fails to claim his mail from the postal office
after the lapse of five (5) days from the date of the first notice of the postmaster. 5
52
In conclusion, we stress that the notice to vacate the leased premises, required by
the Rules to be served on the tenant before a forcible entry or unlawful detainer
action can be commenced against him, may be served by registered mail. This is a
substantial compliance with the modes of service enumerated under Section 2, Rule
70 of the Revised Rules of Court.

At this juncture it bears repeating that actions for forcible entry and unlawful
detainer are summary in nature because they involve a disturbance of social order
which must be abated as promptly as possible without any undue reliance on
technical and procedural rules which only cause delays. In the ultimate analysis, it
matters not how the notice to vacate was conveyed, so long as the lessee or his
agent has personally received the written demand, whether handed to him by the
lessor, his attorney, a messenger or even a postman. The undisputed facts in the
instant case show that the Manila Times Publishing Company, through its manager,
had informed petitioner that Plaza Arcade Inc. was the new owner of the subject
building; that on October 18, 1979, a demand letter was sent to petitioner advising
him to leave the premises but petitioner refused to receive the letter; that a second
demand on January 12, 1981 elicited the same reaction; that a final demand dated
November 16, 1981 was sent to petitioner by registered mail which he again refused.
And even on the supposition that there was no personal service as claimed by
petitioner, this could only be due to petitioner's blatant attempts at evasion which
compelled the new landlord to resort to registered mail. The Court cannot
countenance an unfair situation where the plaintiff in an eviction case suffers further
injustice by the unwarranted delay resulting from the obstinate refusal of the
defendant to acknowledge the existence of a valid demand.

WHEREFORE, the petition is denied for lack of merit and the assailed decision of the
Court of Appeals reversing the dismissal order of the trial court is affirmed. Civil Case
No. 071279-CV is hereby ordered reinstated in the Metropolitan Trial Court of
Manila, Branch 7. This decision is immediately executory. Costs against petitioner.

So ordered.

53
G.R. No. 81015 July 4, 1991 Sometime in October, 1983, Victor and his wife left for Ontario, Canada and did not
return to the Philippines until February, 1985. They left the apartment in the care of
CRESENCIO VIRAY and BENJAMIN D. DE ASIS, petitioners, their son, Ramon.
vs.
HON. INTERMEDIATE APPELLATE COURT and RUSTICO VICTOR, respondents. Believing that the Victor spouses had abandoned the apartment — they having been
away for more than a year, and the place being occupied by Ramon Victor, an
Benjamin D. De Asis for petitioners. unauthorized stranger — De Asis brought suit in the Metropolitan Trial Court in
Efren L. Cordero for private respondent. December, 1984 to evict the latter. But as aforestated, the spouses returned in
February, 1985, and on their representation that they did not mean to give up the
apartment, the case was dismissed on joint motion of the parties dated March 12,
1985.2
NARVASA, J.:
It seems, however, that Rustico Victor did not re-occupy the apartment but
It is about a written lease agreement that the case at bar turns. The lease concerns continued to leave it in the care of his son, Ramon. Later, in the second week of
residential premises identified as Apartment A at 1836 Sulu Street, Sta. Cruz, Manila. October 1985, Ramon himself left for Canada. He asked his brother, Roldan, to look
Said lease was executed on April 1, 1981 by the owner of the place, Benjamin de after the place. But Roldan Victor did not actually move into the apartment; all he did
Asis, and Rustico Victor, as lessee.1 The agreement included stipulations (a) fixing the was to install a padlock at the main door, visit the place once a week, and sleep there
term of the lease and (b) governing the lessors right of repossession, viz.: occasionally.3

(a. Term of Lease)
2. The term of this lease shall be for a period of three (3) months and shall be
impliedly renewable from month to month under the same terms and conditions,
unless revised by the parties in writing with previous notice to each other of at least
fifteen (15) days.
(b. Repossession by Lessor)
7. Upon failure of the Lessee to comply with any of the terms and conditions of this
lease, as well as such other terms and conditions which may be imposed by the
Lessor prior to and/or upon renewal of this lease agreement as provided in par. 2
above, then the Lessor shall have the right, upon five (5) days written notice to the
Lessee or in his absence, upon written notice posted at the entrance of the premises
leased, to enter and take possession of the said premises holding in his trust and
custody and such possessions and belongings of the Lessee found therein after an
inventory of the same in the presence of a witness, all these acts being hereby
agreed to by the Lessee as tantamount to his voluntary vacation of the leased
premises without the necessity of suit in court.
A duplicate original of the contract was given to the lessee, Rustico Victor.
When De Asis learned of this state of affairs sometime in December, 1985, he went
to the place to see for himself if it was true. He saw there was nobody in the
apartment, but he could not get inside because it was locked. De Asis then caused
the cutting off of the electrical and water service connections and, on the following
day, posted at the main door of the apartment a notice of termination of the lease,
on the ground of abandonment and failure to pay rentals in accordance with the
contract. He could not serve the notice of termination directly on the lessee since he
did not know where the latter was.
In the first week of January, 1986, De Asis returned to the apartment and noted that
the termination notice he had posted at the door was no longer there. He posted
another notice, this time announcing that he would repossess the place after five (5)
days in order to secure it from fire, repair it to preserve its value, and inventory such
of the lessee's things as were inside which might thereafter be claimed at his
residence in Quezon City.4
De Asis also wrote on January 2, 1986 to the local barangay captain requesting his
presence at the premises on January 5, 1986 at which time he intended to open and
repossess the apartment. On January 5, 1986, as announced, and in the presence of
the barangay authorities, De Asis had the door of the apartment opened by a
54
carpenter, and hauled to his residence the things found inside after making an
inventory of them. Thereafter, he made repairs on the apartment at a cost of
P13,108.00, and then leased it to Cresencio C. Viray.5
Not long afterwards an action of forcible entry was instituted in the Metropolitan
Trial Court against De Asis and his new lessee, Viray, by Roldan Victor in behalf and in
the name of his father, Rustico. The action was docketed as Civil Case No. 11635-CV
and resulted in a judgment rendered on December 29, 1986 "against the defendants
. . De Asis (owner-lessor) and Sgt. C. Viray (present occupant) ordering the said
defendants to restore plaintiff to the possession and enjoyment of the leased
premises at No. 1836-A Sulu Street, Sta. Cruz, Manila and to pay the costs of this
suit."6 The Metropolitan Trial Court ruled that Rustico Victor could not be deemed to
have abandoned the premises, and even if he had, the apartment could not be
repossessed without Judicial action, the stipulation authorizing the lessor to do so
being void as "against public policy and existing precedents."
De Asis and Viray appealed to the Regional Trial Court, without success. That Court
rendered judgment on June 15, 1987, affirming that of the Metropolitan Trial Court.7
It adopted "by reference the findings of fact and conclusions of law . . . in the
Decision appealed from;" declared the findings to be "in strict accord with the
evidence presented and the conclusions . . . so obviously correct that a detailed
discussion would serve no useful purpose;" and directed "the court of origin to issue
a writ of possession immediately in favor of the plaintiff and family, and to issue an
order directing the immediate return of the personal belongings of plaintiff taken by
defendant Benjamin De Asis inside the apartment in question that were hauled
and/or transported to his residence in Quezon City on April 15, 1987."
De Asis and Viray then appealed to the Court of Appeals. Their appeal met the same
fate. By judgment promulgated on November 27, 1987 by the Fifteenth Division, 8
their petition for review was dismissed and the Regional Trial Court's decision
affirmed.
It is to overturn these three adverse verdicts that De Asis and Viray are now before
this Court. They ask this Court to rule favorably to them on two questions of law, viz.:
(a) whether or not the posting in the premises, in the first week of December, 1985,
of notice of termination of the lease had legally caused its cessation or
extinguishment as of December 31, 1985; and (b) whether or not De Asis had "the
legal and contractual right to repossess the premises" without and independently of
prior judicial authority.9
The Court gave the petition due course by Resolution dated June 28, 1989 and
required the parties to submit memoranda. The petitioners submitted their
memorandum on August 23, 1989. No memorandum was filed by or in behalf of
Rustico Victor within the time appointed.
It is indisputable that the parties' written agreement created a lease on a month-to-
month basis. Such a lease, therefore, must be construed, by established doctrine, 10
as providing a definite period and as terminable by notice at the end of any given
month.
It appears undisputed, too, that the lessor had posted a notice of termination of the
lease at the doorway of the leased apartment and that notice had subsequently
been noted and removed by the lessee's representative. The giving of notice of
termination in this manner is explicitly authorized by Section 2, Rule 70 of the Rules
of Court, which pertinently provides that a demand by a landlord for payment of rent
or comply with the conditions of the lease and to vacate the premises may inter alia
be made "by posting such notice on the premises if no persons be found thereon."
The lease having thus been licitly terminated, the lessee, Rustico Victor and his sons
became obliged to surrender the leased apartment to the lessor. They did not. They
stayed away from the place and did not show up during the repossession undertaken
by the lessor, announced in advance through the posting of another notice on the
door of the apartment.
What the Victors eventually did was to bring a forcible entry suit against De Asis on
the theory that the stipulation in the lease contract authorizing repossession by the
lessor without court action was void as contrary to public policy, and De Asis had
perpetrated the legally proscribed act of taking the law into his own hands.
The stipulation referred to does by its terms empower the lessor to repossess the
apartment extrajudicially. It states that —11
7. Upon failure of the Lessee to comply with any of the terms and conditions of this
lease, as well as such other terms and conditions which may be imposed by the
Lessor prior to and/or upon renewal of this lease agreement as provided in par. 2
above, then the Lessor shall have the right, upon five (5) days written notice to the
Lessee or in his absence, upon written notice posted at the entrance of the premises
leased, to enter and take possession of the said premises holding in his trust and
custody and such possessions and belongings of the Lessee found therein after an
55
inventory of the same in the presence of a witness, all these acts being hereby
agreed to by the Lessee as tantamount to his voluntary vacation of the leased
premises without the necessity of suit in court.
12
It is noteworthy that in an earlier case decided in 1975, Consing v. Jamandre, this
Court sustained the validity of a substantially Identical condition in a written lease
agreement, which read as follows:13
9. That in case of the failure on the part of the SUB-LESSEE to comply with any of the
terms and conditions thereof, the SUB-LESSEE hereby gives an authority to the SUB-
LESSOR or to any of his authorized representatives to take possession of the leased
premises, including all its improvements thereon without compensation to the SUB-
LESSEE and without necessity of resorting to any court action but in which case the
SUB-LESSEE shall be duly advised in writing of her failure to comply with the terms
and conditions of the contract by way of reminder before the takeover.
This Court ruled that the stipulation "is in the nature of a resolutory condition, for
upon the exercise by the Sub-lessor of his right to take possession of the leased
property, the contract is deemed terminated;" and that such a contractual provision
"is not illegal, there being nothing in the law prescribing such kind of agreement. 14
Similarly, there is considerable authority in American law upholding the validity of
stipulations of this nature.15
Although the authorities are not in entire accord, the better view seems to be, even
in jurisdictions adopting the view that the landlord cannot forcibly eject a tenant
who wrongfully holds without incurring civil liability, that nevertheless, where a lease
provides that if the tenants holds over after the expiration of his term, the landlord
may enter and take possession of the premises, using all necessary force to obtain
the actual possession thereof, and that such entry should not be regarded as a
trespass, be sued for as such, or in any wise be considered unlawful, the landlord
may forcibly expel the tenant upon the termination of the tenancy, using no more
force than is necessary, and will not be liable to the tenant therefor, such a condition
in a lease being valid.
. . . although there is contrary authority, the rule supported by a substantial number
of cases is that despite the effect of forcible entry and detainer statutes, where a
lease expressly gives a landlord a right to use such reasonable force as is necessary in
making re-entry and dispossessing a tenant, when the landlord becomes entitled to
possession because of the termination of the term, the landlord can use force in
making re-entry and dispossessing the tenant.
Be this as it may, since the lessor (De Asis) had licitly and efficaciously terminated the
month-to-month lease by notice, and had therefore acquired an affirmative right of
action to judicially eject the lessee after giving notice to vacate, the existence of such
an affirmative right of action constitutes a valid defense against, and is fatal to any
action by the tenant who has been ousted otherwise than judicially to recover
possession. So has this Court had occasion to rule, with unassailable logic, it might be
added. In Apundar v. Andrin,16 this Court said:
In Medel v. Militante (41 Phil. 526), we held that when the tenant denies his
landlord's title this gives rise to a right of action on the part of the landlord to
recover immediate possession of the denied premises; and it follows as a necessary
corollary from this proposition that if the landlord acquires possession peacefully, as
in this case, by the mere act of reentry, the tenant cannot maintain an action to put
the landlord out. The existence of an affirmative right of action on the part of the
landlord to oust the tenant is fatal to the maintenance of any action by the tenant.
Otherwise, the absurd result would follow that a tenant ousted under the
circumstances here revealed would be restored to possession only himself to be
immediately put out in a possessory action instituted by the landlord. To prevent
circuity of action, therefore, we must recognize the affirmative right of action on the
part of the landlord as a complete and efficacious defense to the maintenance of an
action by the tenant. Circuitus est evitandus; et boni prejudices est lites dirimere, ne
lis ex lite oriatur.
Another consideration based upon an Idea familiar to jurisprudence is equally
decisive.1âwphi1 This is found in one of the implications of the familiar maxim, Ubi
jus ibi remedium, the converse of which is of course equally true, namely: Nullum jus
nullum remedium. Applying this idea to the case before us, it is manifest that
inasmuch as the plaintiffs right of possession has been destroyed, the remedy is also
necessarily taken away. Even under the language of the statute itself (Sec. 80, Code
of Civ. Proc.), the action of unlawful detainer does not lie unless the property is
unlawfully withheld from the plaintiff, which imports an actual present right of
possession in him.
Upon the view that the Court thus takes of the facts, the petition for review on
certiorari must be accorded merit and relief correspondingly granted to the
petitioners.
56
WHEREFORE, the judgment of the Court of Appeals of November 27, 1987 in CA-G.R.
SP No. 12280, subject of the appeal, is REVERSED AND SET ASIDE, and another
rendered DISMISSING Civil Case No. 115635-CV of the Metropolitan Trial Court of
Manila (Branch 6). Costs against private respondent.

SO ORDERED.

57
G.R. No. L-35253 July 26, 1976
CITY OF MANILA, petitioner,
vs.
COURT OF APPEALS and METROPOLITAN THEATER COMPANY, respondents.
B.T. Dayaw S.M. Santiago, Jr. & Associates for petitioner.
Jalandoni Jamir & Associates for respondent Company.
CASTRO, C.J:
This is an appeal by way of certiorari from the decision of the Court of Appeals dated
June 20, 1972 in CR-SP-W707-R, annulling the special order of execution of
September 30, 1971 and the writ issue order of December 29, 1971 in civil cases
78845 and 79907 of the Court of First Instance of Manila. This Court resolved to
consider this appeal as a special civil action.
The petitioner City of Manila (hereinafter referred to as the City), commenced on
July 2, 1968 an action for unlawful detainer against the private respondent
Metropolitan Theater Company (Company, for short) in civil case 172062 of the City
Court of Manila, which, after due hearing, dismissed the case. From this dismissal the
City appealed on December 16, 1969 to the Court of First Instance of Manila where
the case was docketed as civil case 78845.
On January 9, 1929 the City and the Company entered into an agreement whereby
for and in consideration of P1.00 the former sold, assigned and transferred to the
latter three parcels of land with a total area of 8,343.40 square meters; that the
building which the Company would construct thereon would be principally devoted
to theatrical performances; that the Company was authorized to borrow money and
mortgage the property as security; that upon completion of the theater, the
Company would reconvey to the City the lots and building, subject to such
encumbrances as might have been imposed thereon in connection with the
construction of the building, that the City after the reconveyance to it of the
property, would execute a contract of lease of the same property in favor of the
Company for a period of 99 years at a yearly rental of P100 and the Company would
pay annually the necessary amount to meet the obligations contracted for the
construction of the building until they are fully paid; and that upon the termination
of the lease; the Company would return to the City the leased premises and the
building.
The Company had borrowed as of December 10, 1931 the total amount of P700,000
from the El Hogar Filipino, secured by a mortgage over the parcels of land involved in
the agreement between the City and the Company.
On December 10, 1931 tie City and the Company entered into and executed a
contract whereby the latter, for and in consideration of P1.00, resold re-assigned, re-
transferred and re-conveyed to the former the parcels of land together with the
theater building constructed thereon. Pursuant to the agreement the City
subsequently leased the same to the Company.
Ravaged during the last World War, the Metropolitan Theater Building could no
longer be devoted to theatrical performances.
The City then notified the Company of the termination of the contract and
demanded that the latter vacate and turn over the premises to the former. The
Company refused to do so; the City then filed an ejectment suit.
On March 19, 1970, during the pre-trial of civil case 78845, the presiding judge of
Branch XXIII of the Court of First Instance of Manila suggested to the City the filing of
another complaint to recover possession of the land and building involved in the
unlawful detainer case.
On May 29, 1970 the City filed a complaint for rescission of contract with
receivership, docketed as civil case 79947, which the City asked in an ex parte
motion to be consolidated with the appealed case 78845. On June 1, 1975 the trial
court approved the consolidation.
After a joint trial of the appealed case and civil case 7,9947, the Court of First
Instance of Manila rendered on August 5, 1971 its decision declaring, among others,
that the City is entitled to recover from the Company the possession of the
Metropolitan Theater Building and the three lots on which it was constructed, and
ordering the Company to deliver the possession thereof to the City.
On August 9, 1971 the City filed a motion for execution of the decision based on
Section 8 of Rule 70 of the Rules of Court relative to judgment in illegal detainer and
forcible entry cans. On August 20, 1971 the Company filed its opposition to the said
motion, contending that the consolidated actions had become an accion publiciana
58
which could not be the subject of a motion for immediate execution under Section 8
of Rule 70 of the Rules of Court.
On August 23, 1971 the Company filed its notice of appeal and cash bond, and on
August 25, 1971 its record on appeal.
On September 1, 1971 the City filed an amended motion for execution, reiterating its
ground for execution pending appeal under Section 8, Rule 70 of the Rules of Court,
and adding another ground, which is the alleged "dilatory tactics and insolvency" of
the Company, under Section 2 of Rule 39 of the Rules of Court. On September 24,
1971 the Company filed its opposition to the amended motion, denying the
allegation that it is insolvent and that its appeal was intended merely to delay, and
praying that, in the event that the trial court should favorably consider the execution
pending appeal under Rule 39 of the Rules of Court, it be allowed to post a
supersedeas bond to stay the execution under Section 3 of said Rule 39. On
September 30, 1971 the trial court issued a special order for the execution of its
judgment dated August 5, 1971, upon the filing by the City of a bond in the amount
of P30,000, pursuant to the provisions of Section 2 of Rule 39 of the Rules Court.
On October 4, 1971 the Company filed an urgent motion for reconsideration,
contending that the City had no valid ground for execution pending appeal under
Section 2 of Rule 39 of the Rules of Court, and reiterating its offer to post a
suspersedeas bond.
On December 29, 1971 the trial court issued an order denying the motion for
reconsideration, approving the bond filed by the City, and directing the
implementation of the execution order of September 30, 1971.
The Company then filed on January 6, 1972 with the respondent Court of Appeals a
special civil action for certiorari and prohibition, docketed as GR-00707-R, for the
annulment of the special order of execution dated September 30, 1971 and the writ-
issue-order o f December 29, 1971. The respondent Court, in its resolution dated
January 11, 1972, granted ex parte the writ of preliminary injunction applied for by
the Company to stay the enforcement of the orders complained of, upon the filing of
a P2,000 bond, and required the City to answer the petition.
The City moved to have the writ of injunction dissolved, pointing out that the bond
was insufficient and that the act sought to be restrained had already become fait
accompli. The motion was denied; the City then filed its answer.
The respondent Court rendered its decision on June 20, 1972 granting the writ of
certiorari and prohibition, setting aside the special order of execution of September
30, 1971 of the trial court, and made permanent the preliminary injunction
theretofore issued. From the said judgment, the City interposed this appeal (which
this Court has considered as a special civil action), claiming that the respondent
Court of Appeals erred in disturbing the findings of fact of the trial court which are
supported by substantial evidence and substituting therefor its own conclusions
which are based on speculations, surmises and conjectures, or which are manifestly
mistaken or absurd; and that the respondent Court used the office of the writ of
certiorari and prohibition to set aside the findings of fact and conclusions made by
the trial court in the exercise of its jurisdiction.
In its answer, the Company contends that the review sought must hinge solely on
whether or not the Court of Appeals has committed errors of jurisdiction or grave
abuse of discretion, as distinguished from mere errors of judgment; That the first
ground relied upon in the petition raises a question Of fact inasmuch as it seeks a
review of the finding of fact of the Court of Appeals; and that the second ground is
devoid of merit since the Court of Appeals is vested by law with jurisdiction to issue
writs of certiorari and prohibition in aid of its appellate jurisdiction and can review
the order of execution of the trial court pending appeal. It likewise refuted the
arguments adduced by the petitioner in support of the errors ally committed by the
respondent Court, and prayed for the dismissal of the petition.
The cardinal issue in this case is Whether or not the respondent Court of Appeals
committed grave abuse of discretion when it set aside the special order of execution
issued by the trial court pending appeal. The petitioner's complaint that the Court of
Appeals made use of the writ of centiorari to set aside the order of execution would
hardly require discussion for it is settled that it can do so provided the trial co
committed a grave abuse of discretion in issuing the order. 1
Section 2 of Rule 39 of the Rules of Court which en tee the conditions in order that a
judgment may be executed before the expiration of the time to appeal is hereunder
quoted:
On motion of the Prevailing party with notice to the adverse party the court may, in
its division order execution to issue before the expiration of the time to appeal upon
good reasons to be stated in a special order. If a record on appeal is filed thereafter
the motion and the special order shall be included the rein.
59
Of the three conditions required (to wit: (a) there must be a motion by the prevailing
party with notice to the adverse party; (b) there must be good reasons for issuing
execution; and (e) the good reasons must be stated in a special order), only the
existence of good reasons is disputed.
Even though the element that gives validity to an execution Pending appeal is the
existence of good reasons in support thereof, the statute, nevertheless, does not
determine, enumerate, or give examples of what may be considered good reasons to
justify execution. What these good reasons are must therefore, necessarily be
addressed to the discretion of the court.
Inasmuch as the issuance of the writ of execution depends on the discretion of the
trial court, such issuance must necessarily be controlled by the judgment of the
judge in accordance with his own conscience and by a sense of justice and equity,
free from the control of another's judgment or conscience. It must be so for
discretion implies the absence of a hard and fast rule. This Court has said that
discretion is the power exercised by a court to determine questions arising in the
trial of a case to which no strict law is applicable, but which from their nature and
the circumstances of the case, are controlled by the personal judgment of the court.
2
It is the power which the law confers on public officials tp act officially under
certain circumstances in accordance with their own judgment or conscience. 3
The discretion given by statute to issue execution pending appeal is not however
unconfined, vagrant, absolute, and arbitrary. Rather, it is sound discretion, for the
court may grant such execution only when there are good reasons therefore, and
which are to be stated in a special order. If in the mind of the court, taking into
consideration the facts and circumstances surraounding the case, good reasons exist,
the exercise of the power to issue immediate execution of the judgment cannot be
considered as grave abuse of discretion. 4 Provided there are good reasons for
execution according to the judgment of the trial judge, such judgment should
generally not be interfered with, modified, controlled, or inquired into by the
appellate court; the latter should generally not substitute its way of thinking for that
of the trial court, otherwise, the discretionary power given to the trial court would
have no meaning. The appellate court may, however, interfere with that discretion
lodged in the trial court only in case of grave abuse 5 or in case conditions have so far
changed since the issuance of the order as to necessitate the intervention of the
appellate court to protect the interests of the parties t contingenecies which were
not or could have not been contemplated by the trial judge at the time of the
issuance of the order. 6
The trial court retains its discretion to issue an order of immediate execution
pending appeal even when the losing party posts a supersedeas bond to stay
execution. 7 It is necessary, however, in order that the trial court may disregard the
supersedeas bond, that there be special and compelling reasons justifying immediate
execution. 8 In the case before us where the Company offered to post a supersedeas
bond to stay immediate execution, the basic issue raised can be resolved by
determining whether there are good, special and compelling reasons justifying the
questioned order of execution. In such determination, the facts and circumstances
which impelled the court to act as it did and its own assessment of the equities are
entitled to considerable weight, for the issuance of the order of immediate execution
is within its sound discretion. 9
1. The first ground given by the trial court to justify immediate execution contains
three concatenated special reasons, namely, the Company's insolvency, the risk of
forfeiture of the City's lots, and the prodigal if not anomalous, wastage of the rental
income of the Theater Building. Said the trial court:
It is not disputed that the four (4) parcels of land on which the Metropolitan Theater
Building was construction are owned by plaintiff City of Manila; that said parcels of
land with a total area of 8,343.40 square. meters covered by Transfer Certificates of
Title Nos. 368, 36813, 7138 were M18 were mortgaged on December 10, 1931 in
favor of El Hogar Filipino to answer for a principal indebtedness of P700,000.00
which was used for the construction of the Metropolitan Theater building now of this
case between the plaintiff and the defendant. After the building was adverely
damaged by the last war, 6e defendant Metropolitan Theater Company did not pay
to El Hogar Filipino the annual amortizations provided for in the mortgage contract
Defendant has not even paid in full the annual interests due the loan. The balance
sheet of the defendant shows that as of June 30, 1968 the indebtedness to the El
Hogar Filipino was P721,547.82 (Exh. R The income from the Metropolitan Theater
Building derived from the rents collected by the defendant from the various tenants
for the year 1966-67 averaged P104,342.00 a year (Exh. C-2); Of this income only
P49,045.92 was paid to El Hogar Filipino. The rest of the income was disbursed for
overhead expense including the directors' fees, officers' salaries, salaries and wages
of employees, legal and audit fees, maintenance and repair (Exh. R-1, sheet 2, Exh. R-
2, sheet 4). There are no prospects that the indebtedness to El Hogar Filipino never
be paid if the defendant continues possessing the Metropolitan Theater Building as it
has done for the past 26 years. At any time it chooses to, El Hogar Filipino may
exercise its right to foreclose the mortgage because of defendant's failure to pay the
60
annual amortizations on the mortgage loan. It is not right, fair or just that defendant
Metropolitan Theater Company should be allowed to continue possessing the
property in litigation during the pendency of this continue on appeal when the highly
valuable parcels of land on which the building in dispute is constructed belong to the
plaintiff City of Manila, which lands run the risk of being foreclosed any time by the
mortgagee El Hogar Filipino because of defendant's failure to pay the annual
amortizations agreed upon in the mortgage contract.
The City of Manila has made it of reward that it is willing to pay the mortgage debt to
El Hogar Filipino. It has to do so to prevent a very valuable property from danger
foreclosed The City of Manila is in a very much better financial position than the
defendent to pay the mortgage obligation. The fact that El Hogar Filipino has not
chosen up to now to exercise its right of foreclosure does net change the fact that
there is danger of foreclosure and that El Hogar Filipino may exercise its right to do
same at any time. If El Hogar Filipino foreclose the mortgage, the City on Manila
loses four (4) — parcels of valuable property containing a total area of 8,343.40
square meters. The defendant does not stand to lose much according to its
managing director all the income that it rives from the building is eaten up by
administration expenses, maintenance expenses, salaries of officers and employees,
partial payment of interests El Hogar Filipino and other necessary expenses. The City
of Manila is entitled in justice and equity to the immediate possession of the
property in litigation so it can take steps to protect its interests on the building and
the land and to prevent further damage.
It has been held that when judgment is in favor of the plaintiff it may be executed
immediately, to prevent further damage to him caused by the loss of his possession
(Sumintac vs. Court, 74 Phil. 445).
In the decision complained of, the Court of Appeals discarded the first ground relied
upon by the trial court, to wit, that the Company is insolvent. Said the Court of
Appeals:
From the evidence of respondent City of Manila that the income of the Metropolitan
Theater Building for the yearn 1966-67 averaged P104,342.00 a year and of that
income. only P49,045.92 was paid to El Hogar Filipino, and that as of June 30, 1968,
the indebtedness to the latter was P721,547.82, respondent court expressed the
view that 'There are no prospects that the indebtedness to El Hogar Filipino can ever
be paid if the defendant (Metropolitan Theater Company) continues possessing the
Metropolitan Theater Building. ... At any time it chooses to, El Hogar Filipino may
exercise its right to foreclose the mortgage because of defendant's failure to pay the
annual amortizations of the mortgage loan.
Be that as it may, it does not clearly show the insolvency of the Metropolitan Theater
Company. It may have the means, other than the income from the theater building,
with which. to meet its financial obligations.
If the facts from which the trial court inferred the Company's insolvency were only
those recited by the Court of Appeals in the aforequoted paragraphs then we cannot
but agree with the appellate court that the insolvency of the Company has not bean
celebrity shown. But the Court of Appeals has omitted, and consequently failed to
appreciate, many other facts recited m the special order of execution, which clearly
show that the Company is insolvent. It omitted and, disregarded the fact that the
Company could not even pay in full the annual interest due due on the mortgage for
26 years, as a consequence of which the original loan of P700,000 had increased to
P721,547.82 10 It likewise omitted and failed to consider other factors appearing in
the other portions of the record, to wit, that the balance sheet of the Company
shows a total deficit of P1,261,851 as of December 31, 1967, as against the book
value of its capital of only P77,419.58; 11 that the Company has incurred in arrears in
monthly dues and penalties that ran up to P439,019.11 from February 1967 to June
1968, inclusive; 12 that, as stated by the trial court, "There are no prospects that the
indebtedness to El Hogar Filipino can ever be paid if the Defendant continues
possessing the Metropolitan Theater Building as it has done for the past 26 years
after the last war."
The Company, however, contends that the trial court has not categorically found
that the Company is insolvent This contention cannot be accorded credit inasmuch
as the insolvency of a party may be inferred from a number of circumstances on
record. 13 If insolvency is the inability or the lack of means to pay one's debt, or the
condition of a person who is unable to pay his debts as they fall due, 14 then there is
no doubt that the Company is insolvent for it has been unable to pay not only the
amortizations on the principal but also the full interests on the loan as they fell due,
and that it is not in a position to pay the mortgage debt.
The Court of Appeals, however, not only disregard the facts on record when it stated
that the insolvency of the Company has not been clearly shown, but also aggravated
its error when it conjectured that the Company "may have means, other than the
income from the theater building, with which to meet its financial obligations." The
mere possibility that the Company may have means to pay its obligations cannot
61
outweigh the facts on record that clearly show that the Company is insolvent. The
Court of Appeals, in setting aside the conclusion of the trial court on this matter of
the Company's insolvency, which, as has been shown, is based on the facts on
record, and substituting therefor its conjecture, committed grave abuse of
discretion, for "the findings of fact of the lower court cannot be disregarded except
in the absence of substantial evidence to support it." 15 This Court has likewise sad
that "it is a fair statement of the governing principle to say that the appellate
function is exhausted when there is found to be a rational basis for the result
reached by the trial court." 16
It cannot be gainsaid that the insolvency of a defeated party, where it has been
clearly shown is a good and special reason for execution pending appeal. 17
Compounding the Company's insolvency and as a result of its failure to pay its
obligations, is the risk of forfeiture of the City's valuable lots. The parcels of land on
which the Metropolitan Theater Building was constructed are the City's property,
and that the Company, by agreement with the City, mortgaged these lots in favor of
the El Hogar Filipino to answer for the principal indebtedness of P700,000 used for
the construction of the Metropolitan Theater Building. Inasmuch as the Company
has failed for 26 years after World War II to pay in full even the interests on the
indebtedness, let alone the amortizations on the principal, the El Hogar Filipino has
the right to foreclose the mortgage Should the mortgage be foreclosed the City will
lose its three parcels of land with a total area of 8,343.40 square meters, but the
Company, on the contrary, will not stand to lose much, for the money it spent in the
construction of the Theater was borrowed from the mortgagee, and the income it
derives from the building, according to the Company's managing director, is totally
eaten up by administration expenses, maintenance expenses, salaries of officers and
employees, sundry expenses and partial payments of the interest on the loan.
The Court of Appeals, however, rejected this ground, stating that the danger of
foreclosure; according to the belief of the Company, is very remote. It said:
The Metropolitan Theater Company entertained a strong belief that the danger that
El Hogar Filipino might foreclose on the property "is very remote," and cited the fact
that it has not even been ever hinted.
The fact that the Company entertained said tenuous belief cannot negate the
mortgagee's right to foreclose whenever it so desires. Neither can such belief serve
as a guaranty that the mortgagee will not foreclose nor will it bar foreclosure should
it desire to. The fact is that because the mortgaged has a right to foreclose whenever
it so chooses, the City runs the risk of losing its property given as security. As
between the City that would lose incalculably more and the Company which would
lose practically nothing in case of foreclosure, the City must take more pains in
avoiding the foreclosure.
2. The second ground given by the trial court to justify immediate execution is the
City's having pit up a bond of P30,000 to answer for the return of the property and
damages in the event that it be finally adjudicated on appeal that the Company is
entitled to the possession of the property. The Court of Appeals did not likewise
consider this as a good reason for execution pending appeal on the ground that the
action is not for a sum of money and that in the case of Rodriguez vs. Court of
Appeals 18 the filing of the bond w not by itself considered a good reason, for the
dilatory nature of the appeal was also considered by this Court.
It is true that in Rodriguez vs. Court of Appeals, this Court considered, besides the
filing of the supersedeas bond alone or the dilatory nature of the appeal. That does
not mean, however, that the filing of the supersedeas bond al or the dilatory nature
of the appeal alone, is not in itself a good and special reason for execution pending
appeal. In the very same case relied upon by the Court of Appeals, this Court
approvingly quoted Moran, thus:
The element that gives validity to an order of execution is the existence of the good
reasons if they may be found distinctly somewhere in the record. In this connection it
has been held that the filing of bond by the successful party is a good reason for
ordering excecution. That the appeal is being taken for purposes of delay is also a
good reason. (Rodriguez v. Court of Appeals, 105 Phil. 777, 780-781). 19
In Hacienda Navarra, Inc. vs. Labrador 20 the filing of bond alone was considered a
good and special reason for ordering execution pending appeal. Said this Court:
The filing of the bond required by the respondent judge in the order sought to be
annulled constitutes a special ground authorizing the court to issue a writ of
execution pending appeal, in conformity with the provisions of section 144 of the
Code of Civil Procedure.
In People's Bank vs. San Jose 21 this Court also held that the filing of a bond by the
prevailing party is a good and special reason for ordering execution pending
appeal.22
62
The Court of Appeals also expressed the fear that should the trial court's judgment
be reversed on appeal the damages that may arise from its execution pending appeal
may not be fully compensated, without however stating the nature of the said
damages. Will said damages not be the fair and reasonable value of the use and
occupation of the property or the amount of rentals received by the Company from
the building? Is the P30,000 bond not sufficient for said rentals? If it is insufficient,
should the Court of Appeals not have ordered the amount to be increased?
From what has been said, it is thus clear that the Court of Appeals erred in not
considering the City's posting a bond as a good and special reason to justify
execution pending appeal.
3. The third ground given by the trial court in the special order of execution is that
the expenses of administering the building would be very much less if the City of
Manila were in possession of the building. The reason is that the City will not have to
pay directors' fees, officers' salaries, salaries and wages of employees, and legal and
audit fees, since the City of Manila has already the necessary facilities, personnel and
employees to maintain and administer the building. This ground was rejected, the
Court of Appeals saying that "we cannot bring ourselves to believe that it is
justifiable reason for the immediate execution of the judgment of a respondent
court Moreover it is speculative, without any proof whatsoever."
It will be noted that the Court of Appeals did not doubt the fact that more than one-
half of the average yearly income of the building is spent for directors and
employees salaries, fees and services. Out of the yearly income of P104,342 only
P49,045.92 was paid to El Hogar Filipino. In the appreciation of the trial judge,
although he did not explicitly say so, such expenses were a wastage of the income,
for if it were not so, why did the trial court say that "There are no prospects that the
indebtedness to El Hogar Filipino can ever be paid if the defendant continue s
possessing the Metropolitan Theater Building as it has done for the past 26 years
after the last war"? The Court of Appeals hesitated to say whether to prevent this
wastage was a good reason for execution pending appeal.
We do think that under the facts, circumstances and equities in the instant case, to
prevent such wastage of income so that considerably more of the income can be
channelled to the payment of the indebtedness is a compelling reason to justify
immediate execution.
Pursuant to the contract between the City and the Company, the latter, in the words
of the Court of Appeals, is obliged to pay annually the necessary amount to meet the
obligations contracted for the construction of the building until they are fully paid." It
appears that the Company's income from the building is the only source of what it
pays to the El Hogar Filipino, for in its memorandum, the Company says that it is the
duty of the petitioner to repair the building so that it could "generate enough
income to cover fully the amortizations due to El Hogar Filipino as they fell due."
Ordinary diligence and prudence dictate that whatever income is derived from the
theater should be primarily and principally devoted to the payment of the
indebtedness. The wastage of the income will ultimately result in non- payment of
the indebtedness, and this will be to the prejudice and damage of the City which
must pay the obligation or the outstanding balance thereof, if it does not want to
lose its lots which were mortgaged. If the present possessor cannot channel such
income to the payment of the indebtedness, should not the City which ultimately has
to pay the indebtedness if the Company fails to pay it not be given an opportunity to
do so? Would it be equitable to allow the present possessor to waste the income,
and let the City ultimately suffer tremendous damages on account of such waste?
The Company, to support the decision of the Court of Appeals, likewise contends
that the refusal of the trial court to accept the supersedeas bond to stop execution is
sufficient to taint the order of execution with arbitrariness and constitutes grave
abuse of discretion.
We do not think so. It is well settled that even upon the filing of the supersedeas
bond, the losing party is not entitled as a matter of right to a suspension of the
excecution Section 3 of Rule 39 of the Rules of Court merely empowers the Court to
order such suspension in the exercise of its sound discretion. 23 The acceptance and
approval of i supersedeas bond to stay execution lies within the discretion of the
court. 24 Hence, the trial court may disregard the supersedeas bond and order
immediate execution provided there are special and compelling reasons justifying
execution, which reasons obtain in this case. 25
Another reason given to support the decision complained of is that execution
pending appeal cannot be justified because the supposed right of the City to
immediate repossession of the property to prevent further loss caused by
dispossession is the core of the controversy and the merit of such claim is under
appeal. Anent this matter suffice it to say that in determining whether execution
should be stayed or not, the merits of a case, which should not be determined in
63
advance of the appeal, are of no moment Thus this Court said in Mapua vs. David 26
that:

The reason by petitioner to maintain that the stay granted by the respondent court is
a grave abuse of discretion is the merits of their own case. They allege that
defendant has absolutely no right to possession and has, therefore, no defense
whatsoever. But the merits of the case should not be determined at this state of the
proceedings in advance of the appeal taken by both parties from the judgment
rendered by respondent court in the principal case.

In conclusion, all the reasons given by the trial court in ordering the execution of its.
order pending appeal, despite the Company's offer to fire a supersedeas bond to
stay execution, are compelling enough to warrant immediate execution. 27

If the same cogent reasons are considered in the light of the fact that the
Metropolitan Theater building is no longer devoted to the primary purpose for which
it was intended, that is, to theatrical performances, they would outweight the
security offered by the supersedeas bond which was rejected by the trial court.

We hold that the Court of Appeals, in substituting its judgment for the statutory
discretion soundly and judiciously exercised by the trial court in issuing the
questioned Social Order of Execution, acted with grave abuse of discretion.

ACCORDINGLY, the decision of the Court of Appeals dated June 20, 1972 in G.R. SP-
00707-R is set aside, and the order of the trial court of December 29, 1971 directing
the implementation of its execution order of September 30, 1971, is maintained,
with costs against the Company.

64
G.R. No. L-44806 March 31, 1977
BIENVENIDO ONCE, petitioner,
vs.
HON. CARLOS Y. GONZALES, Presiding Judge of the Court of First Instance of Iloilo
Branch VI; PROVINCIAL SHERIFF of Iloilo, and JUANITO PEÑA, respondents.
Rosario R. Rapanut (Citizens Legal Assistance Office), for petitioner.
Raymundo Magat for private respondent.
AQUINO, J.:têñ.£îhqwâ£
The city court of Iloilo City, in a decision dated April 29, 1976, ordered Bienvenido
Once to vacate an apartment in a building owned by Juanita Peña and to pay a
monthly rental of P290 until the premises have been vacated, plus P1,000 as
attorney's fees. It was not indicated in the decision when the payment of the
monthly rental should commence. No back rentals were adjudged (Civil Case No
11312).
Bienvenido Once filed a motion for reconsideration. He alleged that he had been
occupying the apartment (one of the four doors of the said building made of cement
hollow blocks and wood, with galvanized iron roofing) since 1966; that he was the
only one singled out for ejectment; that the commissioner's report on the alleged
dilapidated condition of the building was not set for hearing, that he occupied the
apartment as residence and for use as a carinderia which allegedly was his sole
means of livelihood, and that he should be given a preference to reoccupy the
apartment after the completion of the repairs.
The city court denied the motion in its order of June 2, 1976. Bienvenido Once
appealed. He deposited in the city court on June 17, 1976 P580 as rentals for April
and May, 1976, Official Receipt No. 4763496. In the Court of First Instance, he
deposited P290 on July 16, 1976 as rental for June, 1976, Official Receipt No.
1257740; P290 on August 11, 1976 as rental for July, 1976, Official Receipt No.
1977508, and P290 on September 9, 1976, as rental for August, 1976, Official
Receipt No. 198832.
Juanito Peña, the owner of the apartment, filed in the Court of First Instance a
motion dated July 9, 1976 for immediate execution of the city court's judgment. He
invoked, as grounds, Once's alleged failure to file a supersedeas bond and the
supposed untenantable condition of the apartment.
Bienvenido Once, through his lawyer, Marietta J. Homena Valencia, an employee of
the Citizens Legal Assistance Office (CLAO), opposed the motion for execution. Once
alleged that he had deposited the current rentals; that the apartment occupied by
him was not in danger or collapsing, that the building was stable, as shown by the
fact that the owner, Peña, and his family occupied the apartment adjoining the door
leased to Once; that, if repairs were needed, all the occupants of the building should
vacate it, and that the commissioner, who reported on the condition of the building,
was not competent to assess its tenantable condition since he is not an engineer but
a court interpreter.
Executive Judge Valerio V. Rovira granted the motion for execution in this terse order
of August 9, 1976, which reads:
It appearing that the defendant has not filed the supersedeas bond and considering
the provisions of section 8, Rule 70 of the Rules of Court, let a writ of execution issue
to effect the ejectment of the defendant from the premises.
Bienvenido Once filed a motion for reconsideration. He reiterated his contention
that the execution was improper because he had deposited in court the current
rentals. He cited the rule that a supersedeas bond is not necessary in case the tenant
had deposited in court the rentals due (Mischiener vs. Barrios, 76 Phil. 55; Bagtas vs.
Tan, 93 Phil. 804).
The lower court denied the motion. It issued a writ of execution dated September
21, 1976. Bienvenido Once filed a motion for suspension of the execution. He
offered to file a supersedeas bond. He stressed that he had occupied the apartment
for ten years and that his ejection was in contravention of Presidential Decree No.
20. The motion was denied.
On October 14, 1976 Bienvenido Once, through three CLAO lawyers, filed in this
Court the instant special civil actions of certiorari and prohibition in order to set
aside the order and writ of execution. A temporary restraining order was issued by
this Court but before it could be implemented Bienvenido Once was constrained to
vacate the apartment in litigation.
65
The issue is whether the lower court erred in ordering execution of the city court's
judgment pending appeal.

We hold that the lower court committed a patent error in ordering execution of the
city court's judgment on the ground that Bienvenido Once did not file a supersedeas
bond. No such bond was necessary because no back rentals were adjudged in the
city court's judgment. The attorney's fees of P1,000 need not be covered by a
supersedeas bond. (De Laureano vs. Adil, L-43345, July 29, 1976, 72 SCRA 148, 155).

Once's timely deposit of the rentals for April, May, June, July and August, 1976
stayed the execution of the judgment pending appeal. In such a situation, no
supersedeas bond was required to stay execution of the city court's judgment. (Sison
vs. Bayona, 109 Phil. 557, 561).

Consequently, the order of execution was groundless. It was not justified under
section 8, Rule 70 of the Rule of Court. Section 8 requires a supersedeas bond only if
there are accrued rentals in arrears. It dispenses with that bond if the defeated
tenant deposits in court the rentals due from time to time. The execution proceeding
already mentioned is void.

It may be noted that according to Once's manifestation of March 22, 1977, the lower
court in its decision of February 5, 1977 reversed the city court's judgment and
ordered that Once be allowed to reoccupy the leased premises.

WHEREFORE, the lower court's orders of August 9 and September 14, 1976 are set
aside with costs against respondent Peña .

SO ORDERED.

66
A.M. No. MTJ-93-892 October 25, 1995
SAN MANUEL WOOD PRODUCTS, INC., complainant,
vs.
JUDGE RAMON B. TUPAS and CITY SHERIFF FIDEL CASUYON, both of 2nd Municipal
Trial Court in Cities, Davao City, respondents.
PUNO, J.:
In a sworn Complaint,1 dated October 29, 1993, San Manuel Wood Products, Inc.,
charged Judge Ramon B. Tupas and City Sheriff Fidel Casuyon, both of the 2nd
Municipal Trial Court in Cities (Branch II), Davao City, with grave partiality, serious
misconduct, abuse of authority and/or ignorance of the law.
Complainant is the defendant in an unlawful detainer case, docketed as Civil Case
No. 424-B-92.2
On June 3, 1993, respondent judge rendered a decision3 in Civil Case No. 424-B-92,
in favor of the plaintiffs therein and against herein complainant. The parties received
their copies of the decision on June 14, 1993.4
Within the reglementary period to appeal, the plaintiffs filed a "Motion for
Immediate Execution," dated June 21, 1993, of the MTCC decision. The motion was
opposed by complainant.
On June 24, 1993, while the motion for immediate execution was pending in the
MTCC, complainant filed a "Notice of Appeal and Approval of Cash/Supersedeas
Bond"5 to stay the execution of the June 3, 1993 Decision. The notice of appeal and
the supersedeas bond were approved by respondent judge in an Order, 6 dated July
16, 1993, thus:
ORDER
Notice of Appeal in the above-entitled case having been filed within due time, let the
records of this case be forwarded to the Regional Trial Court of Davao City, in degree
(sic) of appeal.
The supersedeas bond in the sum of Forty-One Thousand Pesos (P41,000.00) in cash
executed to the plaintiff is hereby APPROVED to enter action (sic) in the Regional
Trial Court to pay the rents covering the period of thirteen (13) months from May 6,
1992, up to June 6, 1993, and the sum of Fifteen Thousand Pesos (P15,000.00) for
attorney's fees, damages, and costs accruing down to the time of judgment appealed
from. During the pendency of the appeal, defendant shall deposit with the Court the
further amount of monthly rental due from time to time for the reasonable value of
the use and occupation of the premises.
The supersedeas bond is ordered transmitted with the records of this case to the
Clerk of Court of the Regional Trial Court, Davao City, to which the action is appealed
from (sic).
SO ORDERED.
On September 3, 1993, complainant deposited with the clerk of court the sum of
Eight Thousand Pesos (P8,000.00), the rentals due from June 6, 1993 to October 5,
1993.7
The records disclose that the plaintiffs filed a "Supplemental Motion for Execution
Pending Appeal," dated June 30, 1993, in the MTCC. The supplemental motion was
opposed by complainant in its "Comment or Opposition to Supplemental Motion for
Execution Pending Appeal," dated July 14, 1993.
On August 11, 1993, respondent judge issued a special order,8 granting plaintiffs'
motion for a writ of execution pending appeal. The impugned special order reads:
This has reference to the Motion for Immediate Execution and Supplemental Motion
for Execution Pending Appeal filed by plaintiffs within the period to appeal, citing
among others, the compelling reasons why immediate execution be granted. Copies
of plaintiffs' motions were furnished to counsel for defendant and the latter filed its
opposition thereto.
xxx xxx xxx
Plaintiffs alleged in their motion for immediate execution, supplemental motion for
execution pending appeal and supplemental allegations on the motion for
immediate execution the following reasons, to wit:
That lessor is authorized by law, upon the expiration of the lease, to eject the tenant,
to repossess his property for his own use, or for the use of any members of his
families, under paragraph (c) of BP Blg. 877 (Rental Law). Similarly, a land-owner
67
bonafide intention to cultivate the land personally thru employment of machineries,
section 50 (a) RA 1149, as amended by RA 2268, and that defendant, which already
owned more than ten hectares, is prohibited from acquiring the lot in question. That
renders defendants' appeal dilatory.
xxx xxx xxx
To hold that, in the present case, the mere filing of the notice of appeal, and the
filing or deposit of cash bond with the clerk of court has automatically deprived the
trial court of its jurisdiction over this case, would be to practically nullify the
discretionary power granted said court by section 2, Rule 39, to order, upon good
reasons, the execution of its judgment before the expiration of the time to appeal;
because in all cases, the judgment debtor may, on the very day the judgment is
rendered or notified to him, file notice of appeal and deposit of P60.00 as cash bond
with the clerk of
court . . . .
b) plaintiffs as shown in the complaint are badly in need of the land for legitimate
needs as they are only renting lots and houses where they are presently residing, as
per the affidavit of merit attached to plaintiffs' motion.
After a careful perusal of plaintiffs' motion for execution pending appeal and the
opposition thereof (sic), the Court is of the view that, indeed, the special reasons
alleged by plaintiffs are meritorious.
The filing of the Notice of Appeal by the defendant has no other justifiable reasons
than to frustrate the decision of the Court and that the defendant's continued stay in
the premises renders the decision illusory.
Premises considered, let, therefore, issue a writ of execution pending appeal under
Section 2 of Rule 39, upon plaintiffs' filing of a bond which this Court fixed at One
Hundred Thousand pesos (P100,000.00) to answer for any lawful obligations that
maybe (sic) adjudged against plaintiffs, if any, later on. (emphasis supplied)
Resolution of plaintiffs' supplemental allegations on motion for immediate execution
filed on August 11, 1993, on the ground that defendant has failed to pay or deposit
the rentals for the periods from June 7, 1993 to July 6, 1993, and from July 7, 1993 to
August 6, 1993, is hereby withheld as the matter can be appropriately addressed to
the appellate court for its consideration and resolution.
SO ORDERED.
The foregoing special order was received by complainant on September 7, 1993. The
plaintiffs received their copies on September 7 and 8, 1993.
In compliance with the August 11, 1993 Special Order, the plaintiffs posted a bond of
P100,000.00. The bond was approved by respondent judge in an Order, dated
September 8, 1993.9 On its part, complainant moved for a reconsideration of the
August 11, 1993 Special Order and the September 8, 1993 Order and requested the
clerk of court to hold in abeyance the implementation of the writ of execution.
Respondent judge failed to act on the motion for reconsideration.
On September 10, 1993, respondent City Sheriff Fidel Casuyon served the writ to
complainant. It was returned unsatisfied. 10
Complainant now accuses respondent judge of grave partiality, serious misconduct,
abuse of authority and/or ignorance of the law for issuing the August 11, 1993
Special Order and the September 8, 1993 Order.
Complainant contends that, upon perfection of its appeal on July 16, 1993, (sic)
respondent judge lost its jurisdiction over the case. Thus, the Special Order, dated
August 11, 1993, ordering the issuance of the writ of execution pending appeal, is
null and void. Complainant argues, further, that the issuance of the July 16, 1993
Order should be considered as a denial of the motion for execution pending appeal
filed by the plaintiffs.
Furthermore, complainant points out that the rule governing execution of judgment
in ejectment cases is Section 8, Rule 70 of the Rules of Court, not Section 2 of Rule
39, the provision relied upon by respondent judge. Complainant also assails the
immediate implementation of the writ of execution by respondent City Sheriff.
In their joint Comment, 11 dated March 10, 1994, respondents aver that the motion
for execution pending appeal was filed on June 21, 1993, three (3) days before the
filing of the Notice of Appeal and Approval of Cash/Supersedeas Bond. Hence,
respondent judge insists he had not lost jurisdiction to act on the motion for
execution. Allegedly, complainant deposited the supersedeas bond but not the
accruing rentals as directed in the judgment. In view of complainant's failure to
deposit the rentals due, respondent judge claims that the appeal had not been
perfected.
68
Respondents aver, further, that complainant refused to sign the writ and even
constructed three (3) houses on the subject lot despite the issuance of the writ of
execution. They charge that the appeal is a dilatory tactic of the complainant. Finally,
they claim that complainant is guilty of forum shopping when it filed an action before
the Regional Trial Court of Davao City, assailing the validity of the respondent judge's
August 11, 1993 Special Order and the September 8, 1993 Order.
Considering the allegations in the joint comment of the respondents, we required
complainant to file its reply. 12 It did not file any reply. We referred the present
administrative complaint at bar to the Court Administrator for evaluation, report and
recommendation. 13 In a Memorandum, dated May 5, 1995, the Office of the Court
Administrator found the complaint meritorious. The relevant portion of the
memorandum reads:
xxx xxx xxx
It is well settled that to stay the immediate execution in an ejectment proceeding, it
is required that the defendant must (a) perfect his appeal; (b) file the supersedeas
bond and (c) periodically deposit the rentals falling due during the pendency of the
appeal.
As to the perfection of the appeal, with the advent of BP 129, it is now settled that
the perfection of appeal is upon the expiration of the last day to appeal by ANY party
contrary to Judge Tupas' thinking that he has to approve the Notice of Appeal.
Since both plaintiffs and defendant (complainant in this case) received their
respective copies of the decision on June 14, 1993, the last day to appeal was June
29, 1993 and, by operation of law, the appeal of complainant was perfected on June
30, 1993, it having filed its Notice of Appeal on June 24, 1993.
The complainant deposited with the Clerk of Court, MTCC, Davao City the correct
amount of P41,000 to cover the rentals for thirteen (13) months at P2,000.00 a
month and (a)ttorney's fees of P15,000.00. . . . .
It is clear that immediate execution was thus stayed.
Complainant, however, did not deposit periodically — in this case, monthly — (the)
P2,000.00 a month (rental) with the Clerk of Court. This is clear from complainant's
own Annex "C" which shows that the amount of P8,000.00 was paid only on
September 3, 1993 to the Clerk of Court, RTC, Davao City to cover the rental due
from June 6, 1993 to October 5, 1993.
The rule is:
Should the defendant fail to make the payments above prescribed from time to time
during the pendency of the appeal, the appellate court, upon motion of the plaintiff,
of which the defendant shall have notice, and upon proof of such failure shall order
the execution of the judgment appealed from with respect to the restoration of
possession, but such execution shall not be a bar to the appeal taking its course until
the final disposition thereof on its merits. (emphasis supplied)
Judge Tupas had, therefore, NO jurisdiction and authority to issue his Special Order
of August 11, 1993; He should have dismissed all of the plaintiffs' motion for
execution pending appeal because Section 8, Rule 70 and not Section 2, Rule 39 is
what is applicable as this is an ejectment case.
It is only the appellate court — the RTC for ejectment cases — which can order the
issuance of the writ of execution pending appeal but only for the EXPLICIT reason
that the periodic rentals as found in the inferior court decision were not paid, with
notice and hearing mandated.
It does not appear that Judge Tupas acted out of malice or a corrupt motive but
rather a misapprehension of the law on ejectment.
As for Sheriff Casuyon, it appears that the writ was returned unsatisfied.
Complainant's general manager refused to sign the same. While he may have agreed
to a formal delineation of the boundaries, this was because the complainant was
buying time as it had planned to purchase the lot in question but failed.
In view of all the foregoing, it is respectfully recommended that: (a) Retired Judge
Ramon B. Tupas, MTCC, Branch 2, Davao City, be FINED the amount of P10,000.00,
for Gross Ignorance of the Law; (b) the said amount be TAKEN from the P20,000.00
withheld from his terminal leave credits by virtue of Resolution of the Court, dated
February 2, 1994, and (c) the charges against Sheriff Casuyon be dismissed the same
being without merit.
We agree with the legal disquisition of the Office of the Court Administrator.
69
This is an ejectment case, hence, the applicable rule is Section 8, Rule 70 of the Rules
of Court. It states:
Sec. 8. Immediate execution of judgment. How to stay the same. — If judgment is
rendered against the defendant, execution shall issue immediately, unless an appeal
has been perfected and the defendant, to stay execution, files a sufficient bond,
approved by the municipal or city court and executed to the plaintiff to enter the
action in the Court of First Instance (now Regional Trial Court) and to pay the rents,
damages and costs accruing down to the time of the judgment appealed from, and
unless, during the pendency of the appeal, he deposits with the appellate court the
amount of rent due from time to time under the contract, if any, as found by the
judgment of the municipal or city court to exist.
All money so paid to the appellate court shall be deposited in the provincial or city
treasury, and shall be held there until the final disposition of the appeal, unless the
court, by agreement of the interested parties, or in the absence of reasonable
grounds of opposition to a motion to withdraw, or for justifiable reasons, shall
decree otherwise. Should the defendant fail to make the payments above prescribed
from time to time during the pendency of the appeal, the appellate court, upon
motion of the plaintiff, of which the defendant shall have notice, and upon proof of
such failure, shall order the execution of the judgment appealed from with respect
to the restoration of possession, but such execution shall not be a bar to the appeal
from taking its course until the final disposition thereof on its merits. . . . (emphasis
supplied)
Respondent judge missed the foregoing rule when it applied Section 2, Rule 39 of the
Rules of Court. It reads:
Sec. 2 Execution pending appeal — On motion of the prevailing party with notice to
the adverse party the court may, in its discretion, order execution to issue even
before the expiration of the time to appeal, upon good reasons to be stated in a
special order. If a record on appeal is filed thereafter, the motion and the special
order shall be included therein.
It ought to be mentioned that Section 2, Rule 39 of the Rules of Court, applies to
execution pending appeal in ordinary civil actions. This rule requires good reasons
before a writ of execution can be issued in favor of the prevailing party. Its issuance
is subject to the sound discretion of the court and is usually not favored because it
affects the rights of the parties which are yet to be ascertained on appeal.
In stark contrast, under section 8 of Rule 70, it is not necessary to show good reasons
for the immediate execution of the judgment against the
14
defendant. The judgment is executed immediately in favor of the plaintiff, as a
matter of right, to prevent further damage arising from the loss of possession. 15
It is settled that to stay the execution of judgment of an inferior court, the losing
defendant in an ejectment case must: (a) perfect his appeal; (b) file a supersedeas
bond; and (c) make a periodic deposit of the rentals due or the reasonable
compensation for the use and occupation of the property during the pendency of
the appeal. These requisites must concur. 16
In the case at bar, complainant filed his appeal on time and deposited the required
supersedeas bond in the inferior court, but it failed to comply with the third requisite
as related above. As borne by the records, the rentals accruing for the months of
June, July and August were deposited only on September 3, 1993. Upon its failure to
meet the third requisite prescribed under the rules, the plaintiffs have the right to
move for execution of the judgment appealed from. The order of execution,
however, has to be issued by the appellate court, in this case the Regional Trial
Court, since the respondent judge had lost his jurisdiction over the ejectment case
after the appeal to the RTC had been perfected. 17 In disregarding the rules and
settled jurisprudence, the respondent judge showed gross ignorance, albeit without
any malice or corrupt motive.
We now come to the immediate implementation of the writ of execution in Civil
Case No. 424-B-92 by respondent Sheriff Fidel Casuyon. The records show that the
August 11, 1993 Special Order, granting the motion for immediate execution, was
received by complainant on September 7, 1993. The writ of execution was issued on
September 9, 1993. 18 The following day, the writ was served by respondent sheriff
against the complainant.
We have ruled that "the immediate enforcement of a writ of ejectment execution is
carried out by giving the defendant a notice of such writ and making a demand that
defendant comply therewith within a reasonable period, normally from three (3) to
five (5) days, and it is only after such period that the sheriff enforces the writ by the
bodily removal of the defendant and his personal belongings. 19 This was disregarded
by respondent sheriff. Thus, respondent sheriff should be sternly warned for his
infraction to avoid a repetition of similar arbitrariness on his part. 20
IN VIEW WHEREOF, judgment is hereby rendered:
70
1. Holding respondent Judge Ramon B. Tupas administratively liable for gross
ignorance of the rules. Accordingly, he is ordered to pay a fine of Five Thousand
Pesos (P5,000.00); and

2. Warning respondent Sheriff Fidel Casuyon against committing similar violations of

the rules in implementing the writ of execution.

Let a copy of this decision be attached to the personal records of Sheriff Fidel
Casuyon.

SO ORDERED.

71
G.R. No. 100626 November 29, 1991
CITY OF MANILA, represented by Mayor Gemiliano C. Lopez, Jr., petitioner,
vs.
HON. COURT OF APPEALS and THE ARMY & NAVY CLUB, INC., respondents.
The Chief Legal Officer for petitioner.
Ramon A. Gonzales for private respondent.
CRUZ, J.:
Respondent Court of Appeals is faulted in this action for certiorari for having set
aside the order of execution dated June 10, 1991, and the writ of execution issued by
Judge Wilfredo Reyes of the Regional Trial Court of Manila in Civil Case No. 9156335.
This was a complaint for unlawful detainer filed by the City of Manila against private
respondent Army and Navy Club for violation of the lease agreement between them
over a parcel of land on Roxas Boulevard in the said city. A summary judgment in
favor of the petitioner was rendered by the Metropolitan Trial Court of Manila 1 and
seasonably elevated to the Regional Trial Court. To stay its execution, ANC filed a
supersedes bond in the amount of P2,700,000.00, which was approved by Judge
Reyes. 2 He subsequently affirmed the appealed judgment on June 7, 1991. 3
On June 10, 1991, the petitioner filed an ex parte motion for execution on the
ground that the judgment had already become final and executory under RA 6031.
Judge Reyes granted the motion the same day 4 and at 4:00 o'clock that afternoon
the writ of execution was served on ANC.
ANC moved to quash the writ on June 11, 1991, but hours later, sensing that the
motion could not be acted upon, filed a petition for certiorari and prohibition with
the Court of Appeals.
On July 3, 1991, that court issued the questioned decision, 5 prompting the filing of
the present petition for certiorari.
The petitioner assails the action of the respondent court and contends that decisions
of the regional trial court in cases exclusively cognizable by inferior courts and are
final and executory under RA 6031. Thus:
Sec. 1. . . .
In cases falling under the exclusive original jurisdiction of municipal and city courts
which are appealed to the courts of first instance, the decision of the latter shall be
final: Provided, That the findings of facts contained in said decision are supported by
substantial evidence as basis thereof, and the conclusions are not clearly against the
law and jurisprudence; in cases falling under the concurrent jurisdictions of the
municipal and city courts with the courts of first instance, the appeal shall be made
directly to the Court of Appeals whose decision shall be final: Provided, however,
that the Supreme Court in its direction may, in any case involving a question of law,
upon petition of the party aggrieved by the decision and under rules and conditions
that it may prescribe, require by certiorari that the case be certified to it for review
and determination, as if the case had been brought before it on appeal. (Emphasis
supplied.)
The respondents argue on the other hand that under BP 129, decisions of the
regional trial court in cases originating from and within the exclusive jurisdiction of
the metropolitan or municipal trial courts are not final but subject to appeal in a
petition for review to the Court of Appeals. Such decisions cannot be executed
where the period of time for the defendant to perfect his appeal has not yet expired.
Thus:
Sec. 22. (BP 129) — Appellate jurisdiction. — Regional Trial Courts shall exercise
appellate jurisdiction over all cases decided by Metropolitan Trial Courts, Municipal
Trial Courts and Municipal Circuit Trial Courts in their respective territorial
jurisdiction. Such cases shall be decided on the basis of the entire record of the
proceedings had in the court of origin and such memoranda and/or briefs as may be
submitted by the parties or required by the Regional Trial Courts. The decision of the
RTC in such cases shall be appealable by petition for review to the Intermediate
Appellate Court which may give it due course only when the petition shows prima
facie that the lower court has committed an error of fact or law that will warrant a
reversal or modifications of the decision or judgment sought to be reviewed.
(Emphasis supplied.)
72
It is useful at this point to review the distinction between a "final" judgment and one
which has become "final and executory."
In PLDT Employees Union v. PLDT Free Telephone Workers Union, 6 the Court
observed:
. . . (A)n order or judgment is deemed final when it finally disposes of the pending
action so that nothing more can be done with it in the trial court. In other words, a
final order is that which gives an end to the litigation . . . when the order or judgment
does not dispose of the case completely but leaves something to be done upon the
merits, it is merely interlocutory.
The case of Antonio v. Samonte 7 elaborated on this matter thus:
A final order of judgment finally disposes of, adjudicates, or determines the rights, or
some right or rights of the parties, either on the entire controversy or on some
definite and separate branch thereof, and concludes them until it is reversed or set
aside . . .Where no issue is left for future consideration, except the fact of
compliance or non-compliance with the terms of the judgment or order, such
judgment or order is final and appealable.
By contrast, in Investments, Inc. v. Court of Appeals, 8 we declared:
Now, a "final judgment" in the sense just described becomes final "upon expiration
of the period to appeal therefrom if no appeal has been duly perfected" or, an
appeal therefrom having been taken, the judgment of the appellate tribunal in turn
becomes final and the records of the case are returned to the Court of origin. The
"final" judgment is then correctly categorized as a "final and executory judgment" in
respect to which, as the law explicitly provides, "execution shall issue as a matter of
right." It bears stressing that only a final judgment or order, i.e., "a judgment or
order that finally dispose of the action of proceeding" can become final and
executory.
A judgment becomes "final and executory" by operation of law. Finality of judgment
becomes a fact upon the lapse of the reglementary period to appeal if no appeal is
perfected. In such a situation, the prevailing party is entitled to a writ of execution,
and issuance thereof is a ministerial duty of the court.
Both RA 6031 and BP 129 provide that decisions of the regional trial court in its
appellate capacity may be elevated to the Court of Appeals in a petition for review.
In effect, both laws recognize that such judgments are "final" in the sense that they
finally dispose of, adjudicate, or determine the rights of the parties in the case. But
such judgments are not yet "final and executory" pending the expiration of the
reglementary period for appeal. During that period, execution of the judgment
cannot yet be demanded by the winning party as a matter of right.
In the present case, the private respondent had up to June 25, 1991, to appeal the
decision of the regional trial court. The motion for execution was filed by the
petitioner on June 10, 1991, before the expiration of the said reglementary period.
As the decision had not yet become final and executory on that date, the motion was
premature and should therefore not have been granted. Contrary to the petitioner's
contention, what the trial court authorized was an execution pending appeal.
While it is true that execution pending appeal is allowed under Rule 39, Sec. 2, of the
Rules of Court, this provision must be strictly construed, being an exception to the
general rule. The reason allowing this kind of execution must be of such urgency as
to outweigh the injury or damage of the losing party should it secure a reversal of
the judgment on appeal. Absent any such justification, the order of execution must
be struck down as flawed with grave abuse of discretion. 9
We see no such justification in the case before us.
It is worth remarking that as the case was not tried under the Rule on Summary
procedure, the writ of execution did not even fall under the following Section 18
thereof :
d) Sec. 18. Appeal. — The judgment or final order, including that rendered under
Section 5 hereof, shall be appealable to the appropriate regional trial court which
shall decide the same on the basis of the records, in accordance with Section 22 of
Batas Pambansa Blg. 129. The decision of the regional trial court in such civil cases
shall be immediately executory.
To stay the execution, a supersedes bond is necessary except where one has already
been filed in the lower court. This bond continues to be effective if the judgment of
the regional trial court is appealed. But during the pendency of the appeal, the
defendant-appellant must continue to depositing with the appellate court the
payments required in the appealed judgment. The rentals accruing during the
pendency of the appeal must be deposited on or before the date stipulated, if there
is one, and in the absence thereof, on or before the dates provided for in Sec. 8 of
73
Rule 70. Failure to make such deposits or payments is ground for execution of the
judgment. 10
Since the private respondent in the case at bar has filed a supersedeas bond and the
stipulated rental is yearly, 11 execution may issue only when it fails to make the
yearly deposit of the rental, and after notice and hearing. Such default has not yet
been established.
The Court notes with disapproval the arbitrary manner in which Sheriff Dominador
Cacpal and Deputy Sheriff Reynaldo Cordero acted in delivering possession of the
leased premises to the petitioner. The evidence shows that they enforced the writ of
execution on the same date they received it, forcibly taking out movables from the
said premises, including chandeliers, furniture and furnishings, music organs, stereo
components, lighting fixtures and computers. They turned off the water, cut off the
electricity and disconnected the telephones. They also unreasonably prevented ANC
members from entering the premises to get their personal belongings.
Cacpal and Cordero are hereby sternly reprimanded and warned that a repetition of
similar arbitrariness will be dealt with more severely. Their conduct was a clear
violation of the requirement that:
Under the Rules of Court the immediate enforcement of a writ of ejectment
execution is carried out by giving the defendant notice of such writ, and making a
demand that defendants comply therewith within a reasonable period, normally
from three (3) to five (5) days, and it is only after such period that the sheriff
enforces the writ by the bodily removal of the defendant and his personal belonging.
12
On the issue of the propriety of a special civil action for certiorari to assail an order of
execution pending appeal, this Court has held that —
. . . Although Sec. 1, Rule 66 of the Rules of Court provides that the special civil action
of certiorari may only be invoked when "there is no appeal, nor any plain, speedy
and adequate remedy in the (ordinary) course of law" this rule is not without
exception. The availability of the ordinary course of appeal does not constitute
sufficient ground to prevent a party from making use of the extraordinary remedy of
certiorari where the appeal is not an adequate remedy or equally beneficial, speedy
and sufficient. It is the inadequacy — not the mere absence of all other legal
remedies and the danger of failure of justice without merit that usually determines
the propriety of certiorari. 13
While appeal is normally employed to question an order or writ which varies the
terms of the decision being executed, it is nevertheless not the sole and exclusive
remedy. The special civil action of certiorari and prohibition under Rule 65 was
available to the private respondent on the allegation that the regional trial court, in
issuing the writ of execution, committed grave abuse of discretion and acted beyond
its jurisdiction and that the ordinary remedy of appeal was inadequate.
The last question to be resolved is, assuming that the decision of the regional trial
court had already become "final and executory," could the said court order its
execution?
The rule is that if the judgment of the metropolitan trial court is appealed to the
regional trial court and the decision of the latter is itself elevated to the Court of
Appeals, whose decision thereafter became final, the case should be remanded
through the regional trial court to the metropolitan trial court for execution. 14 The
only exception is the execution pending appeal, which can be issued by the regional
trial court under Sec. 8 of Rule 70 or the Court of Appeals or the Supreme Court
under Sec. 10 of the same Rule.
As previously observed, the petitioner has shown no weighty justification for the
application of the exception. Hence, the respondent court committed no error in
reversing the Regional Trial Court of Manila and annulling the writ of execution
issued by it on June 10, 1991, pending appeal of its decision.
ACCORDINGLY, the petition is DISMISSED, and the challenged decision of the Court
of Appeals is AFFIRMED in toto. No costs.
SO ORDERED.
74
G.R. No. L-57348 May 16, 1985
FRANCISCO DEPRA, plaintiff-appellee,
vs.
AGUSTIN DUMLAO, defendant-appellant.
Roberto D. Dineros for plaintiff-appellee.
Veil D. Hechanova for defendant-appellant.
MELENCIO-HERRERA, J.:
This is an appeal from the Order of the former Court of First Instance of Iloilo to the
then Court of Appeals, which the latter certified to this instance as involving pure
questions of law
Plaintiff-appellee, Francisco Depra, is the owner of a parcel of land registered under
Transfer Certificate of Title No. T3087, known as Lot No. 685, situated in the
municipality of Dumangas, Iloilo, with an area of approximately 8,870 square meters.
Agustin Dumlao, defendant-appellant, owns an adjoining lot, designated as Lot No.
683, with an approximate area of 231 sq. ms.
Sometime in 1972, when DUMLAO constructed his house on his lot, the kitchen
thereof had encroached on an area of thirty four (34) square meters of DEPRA's
property, After the encroachment was discovered in a relocation survey of DEPRA's
lot made on November 2,1972, his mother, Beatriz Depra after writing a demand
letter asking DUMLAO to move back from his encroachment, filed an action for
Unlawful Detainer on February 6,1973 against DUMLAO in the Municipal Court of of
Dumangas, docketed as Civil Case No 1, Said complaint was later amended to include
DEPRA as a party plain. plaintiff.
After trial, the Municipal Court found that DUMLAO was a builder in good faith, and
applying Article 448 of the Civil Code, rendered judgment on September 29, 1973,
the dispositive portion of which reads:
Ordering that a forced lease is created between the parties with the plaintiffs, as
lessors, and the defendants as lessees, over the disputed portion with an area of
thirty four (34) square meters, the rent to be paid is five (P5.00) pesos a month,
payable by the lessee to the lessors within the first five (5) days of the month the
rent is due; and the lease shall commence on the day that this decision shall have
become final.
From the foregoing judgment, neither party appeal so that, ff it were a valid
judgment, it would have ordinarily lapsed into finality, but even then, DEPRA did not
accept payment of rentals so that DUMLAO deposited such rentals with the
Municipal Court.
On July 15,1974, DEPRA filed a Complaint for Quieting of Title against DUMLAO
before the then Court of First Instance of Iloilo, Branch IV (Trial Court), involving the
very same 34 square meters, which was the bone of contention in the Municipal
Court. DUMLAO, in his Answer, admitted the encroachment but alleged, in the main,
that the present suit is barred by res judicata by virtue of the Decision of the
Municipal Court, which had become final and executory.
After the case had been set for pre-trial, the parties submitted a Joint Motion for
Judgment based on the Stipulation of Facts attached thereto. Premised thereon, the
Trial Court on October 31, 1974, issued the assailed Order, decreeing:
WHEREFORE, the Court finds and so holds that the thirty four (34) square meters
subject of this litigation is part and parcel of Lot 685 of the Cadastral Survey of
Dumangas of which the plaintiff is owner as evidenced by Transfer Certificate of Title
No. 3087 and such plaintiff is entitled to possess the same.
Without pronouncement as to costs.
SO ORDERED.
Rebutting the argument of res judicata relied upon by DUMLAO, DEPRA claims that
the Decision of the Municipal Court was null and void ab initio because its
jurisdiction is limited to the sole issue of possession, whereas decisions affecting
lease, which is an encumbrance on real property, may only be rendered by Courts of
First Instance.
Addressing out selves to the issue of validity of the Decision of the Municipal Court,
we hold the same to be null and void. The judgment in a detainer case is effective in
respect of possession only (Sec. 7, Rule 70, Rules of Court). 1 The Municipal Court
over-stepped its bounds when it imposed upon the parties a situation of "forced
lease", which like "forced co-ownership" is not favored in law. Furthermore, a lease is
an interest in real property, jurisdiction over which belongs to Courts of First
75
Instance (now Regional Trial Courts) (Sec. 44(b), Judiciary Act of 1948; 2 Sec. 19 (2)
Batas Pambansa Blg. 129). 3 Since the Municipal Court, acted without jurisdiction, its
Decision was null and void and cannot operate as res judicata to the subject
complaint for Queting of Title. Besides, even if the Decision were valid, the rule on
res judicata would not apply due to difference in cause of action. In the Municipal
Court, the cause of action was the deprivation of possession, while in the action to
quiet title, the cause of action was based on ownership. Furthermore, Sec. 7, Rule 70
of the Rules of Court explicitly provides that judgment in a detainer case "shall not
bar an action between the same parties respecting title to the land. " 4
Conceded in the Stipulation of Facts between the parties is that DUMLAO was a
builder in good faith. Thus,
8. That the subject matter in the unlawful detainer case, Civil Case No. 1, before the
Municipal Court of Dumangas, Iloilo involves the same subject matter in the present
case, the Thirty-four (34) square meters portion of land and built thereon in good
faith is a portion of defendant's kitchen and has been in the possession of the
defendant since 1952 continuously up to the present; ... (Emphasis ours)
Consistent with the principle that our Court system, like any other, must be a dispute
resolving mechanism, we accord legal effect to the agreement of the parties, within
the context of their mutual concession and stipulation. They have, thereby, chosen a
legal formula to resolve their dispute to appeal ply to DUMLAO the rights of a
"builder in good faith" and to DEPRA those of a "landowner in good faith" as
prescribed in Article 448. Hence, we shall refrain from further examining whether
the factual situations of DUMLAO and DEPRA conform to the juridical positions
respectively defined by law, for a "builder in good faith" under Article 448, a
"possessor in good faith" under Article 526 and a "landowner in good faith' under
Article 448.
In regards to builders in good faith, Article 448 of the Civil Code provides:
ART. 448. The owner of the land on which anything has been built sown or planted in
good faith,
shall have the right
to appropriate as his own the works, sowing or planting, after payment of the
indemnity provided for in articles 546 and 548, or
to oblige the one who built or planted to pay the price of the land, and the one who
sowed, the proper rent.
However, the builder or planter cannot be obliged to buy the land if its value is
considerably more than that of the building or trees. In such case, he shall pay
reasonable rent, if the owner of the land does not choose to appropriate the building
or trees after proper indemnity. The parties shall agree upon the terms of the lease
and in case of disagreement, the court shall fix the terms thereof (Paragraphing
supplied)
Pursuant to the foregoing provision, DEPRA has the option either to pay for the
encroaching part of DUMLAO's kitchen, or to sell the encroached 34 square meters
of his lot to DUMLAO. He cannot refuse to pay for the encroaching part of the
building, and to sell the encroached part of his land, 5 as he had manifested before
the Municipal Court. But that manifestation is not binding because it was made in a
void proceeding.
However, the good faith of DUMLAO is part of the Stipulation of Facts in the Court of
First Instance. It was thus error for the Trial Court to have ruled that DEPRA is
"entitled to possession," without more, of the disputed portion implying thereby that
he is entitled to have the kitchen removed. He is entitled to such removal only when,
after having chosen to sell his encroached land, DUMLAO fails to pay for the same. 6
In this case, DUMLAO had expressed his willingness to pay for the land, but DEPRA
refused to sell.
The owner of the building erected in good faith on a land owned by another, is
entitled to retain the possession of the land until he is paid the value of his building,
under article 453 (now Article 546). The owner of the land, upon the other hand, has
the option, under article 361 (now Article 448), either to pay for the building or to
sell his land to the owner of the building. But he cannot as respondents here did
refuse both to pay for the building and to sell the land and compel the owner of the
building to remove it from the land where it erected. He is entitled to such remotion
only when, after having chosen to sell his land. the other party fails to pay for the
same (italics ours).
We hold, therefore, that the order of Judge Natividad compelling defendants-
petitioners to remove their buildings from the land belonging to plaintiffs-
respondents only because the latter chose neither to pay for such buildings nor to
sell the land, is null and void, for it amends substantially the judgment sought to be
76
executed and is. furthermore, offensive to articles 361 (now Article 448) and 453
(now Article 546) of the Civil Code. (Ignacio vs. Hilario, 76 Phil. 605, 608[1946]).
A word anent the philosophy behind Article 448 of the Civil rode.
The original provision was found in Article 361 of the Spanish Civil Code; which
provided:
ART. 361. The owner of land on which anything has been built, sown or planted in
good faith, shall have the right to appropriate as his own the work, sowing or
planting, after the payment of the indemnity stated in Articles 453 and 454, or to
oblige the one who built or planted to pay the price of the land, and the one who
sowed, the proper rent.
As will be seen, the Article favors the owner of the land, by giving him one of the two
options mentioned in the Article. Some commentators have questioned the
preference in favor of the owner of the land, but Manresa's opinion is that the
Article is just and fair.
. . . es justa la facultad que el codigo da al dueno del suelo en el articulo 361, en el
caso de edificacion o plantacion? Algunos comentaristas la conceptuan injusta, y
como un extraordinario privilegio en favor de la propiedad territorial. Entienden que
impone el Codigo una pena al poseedor de buena fe y como advierte uno de los
comentaristas aludidos 'no se ve claro el por que de tal pena . . . al obligar al que
obro de buena fe a quedarse con el edificio o plantacion, previo el pago del terreno
que ocupa, porque si bien es verdad que cuando edifico o planto demostro con este
hecho, que queria para si el edificio o plantio tambien lo es que el que edifico o
planto de buena fe lo hizo en la erronea inteligencia de creerse dueno del terreno
Posible es que, de saber lo contrario, y de tener noticia de que habia que comprar y
pagar el terreno, no se hubiera decidido a plantar ni a edificar. La ley obligandole a
hacerlo fuerza su voluntad, y la fuerza por un hecho inocente de que no debe ser
responsable'. Asi podra suceder pero la realidad es que con ese hecho voluntario,
aunque sea inocente, se ha enriquecido torticeramente con perjuicio de otro a quien
es justo indemnizarle,
En nuestra opinion, el Codigo ha resuelto el conflicto de la manera mas justa y
equitativa y respetando en lo possible el principio que para la accesion se establece
en el art. 358. 7
Our own Code Commission must have taken account of the objections to Article 361
of the Spanish Civil Code. Hence, the Commission provided a modification thereof,
and Article 448 of our Code has been made to provide:
ART. 448. The owner of the land on which anything has been built, sown or planted
in good faith, shall have the right to appropriate as his own the works, sowing or
planting, after payment of the indemnity provided for in articles 546 and 548, or to
oblige the one who built or planted to pay the price of the land, and the one who
sowed, the proper rent. However, the builder or planter cannot be obliged to buy
the land if its value is considerably more than that of the building or trees. In such
case, he shall pay reasonable rent, if the owner of the land does not choose to
appropriate the building or trees after proper indemnity. The parties shall agree
upon the terms of the lease and in case of disagreement, the court shall fix the terms
thereof.
Additional benefits were extended to the builder but the landowner retained his
options.
The fairness of the rules in Article 448 has also been explained as follows:
Where the builder, planter or sower has acted in good faith, a conflict of rights arises
between the owners, and it becomes necessary to protect the owner of the
improvements without causing injustice to the owner of the land. In view of the
impracticability of creating a state of forced co-ownership, the law has provided a
just solution by giving the owner of the land the option to acquire the improvements
after payment of the proper indemnity, or to oblige the builder or planter to pay for
the land and the sower to pay for the proper rent. It is the owner of the land who is
authorized to exercise the option, because his right is older, and because, by the
principle of accession, he is entitled to the ownership of the accessory thing. (3
Manresa 213; Bernardo vs. Bataclan, 37 Off. Gaz. 1382; Co Tao vs. Chan Chico, G.R.
No. 49167, April 30, 1949; Article applied: see Cabral, et al vs. Ibanez [S.C.] 52 Off.
Gaz. 217; Marfori vs. Velasco, [C.A.] 52 Off. Gaz. 2050). 8
WHEREFORE, the judgment of the trial Court is hereby set aside, and this case is
hereby ordered remanded to the Regional Trial Court of Iloilo for further
proceedings consistent with Articles 448 and 546 of the Civil Code, as follows:
1. The trial Court shall determine
a) the present fair price of DEPRA's 34 square meter area of land;
77
b) the amount of the expenses spent by DUMLAO for the building of the kitchen; two-year period, or upon default by DUMLAO in the payment of rentals for two (2)
consecutive months, DEPRA shall be entitled to terminate the forced lease, to
c) the increase in value ("plus value") which the said area of 34 square meters may recover his land, and to have the kitchen removed by DUMLAO or at the latter's
have acquired by reason thereof, and expense. The rentals herein provided shall be tendered by DUMLAO to the Court for
payment to DEPRA, and such tender shall constitute evidence of whether or not
d) whether the value of said area of land is considerably more than that of the
compliance was made within the period fixed by the Court.
kitchen built thereon.
c) In any event, DUMLAO shall pay DEPRA an amount computed at Ten Pesos
2. After said amounts shall have been determined by competent evidence, the
(P10.00) per month as reasonable compensation for the occupancy of DEPRA's land
Regional, Trial Court shall render judgment, as follows:
for the period counted from 1952, the year DUMLAO occupied the subject area, up
a) The trial Court shall grant DEPRA a period of fifteen (15) days within which to to the commencement date of the forced lease referred to in the preceding
exercise his option under the law (Article 448, Civil Code), whether to appropriate paragraph;
the kitchen as his own by paying to DUMLAO either the amount of tile expenses
d) The periods to be fixed by the trial Court in its Precision shall be inextendible, and
spent by DUMLAO f or the building of the kitchen, or the increase in value ("plus
upon failure of the party obliged to tender to the trial Court the amount due to the
value") which the said area of 34 square meters may have acquired by reason
obligee, the party entitled to such payment shall be entitled to an order of execution
thereof, or to oblige DUMLAO to pay the price of said area. The amounts to be
for the enforcement of payment of the amount due and for compliance with such
respectively paid by DUMLAO and DEPRA, in accordance with the option thus
other acts as may be required by the prestation due the obligee.
exercised by written notice of the other party and to the Court, shall be paid by the
obligor within fifteen (15) days from such notice of the option by tendering the No costs,
amount to the Court in favor of the party entitled to receive it;
SO ORDERED.
b) The trial Court shall further order that if DEPRA exercises the option to oblige
DUMLAO to pay the price of the land but the latter rejects such purchase because, as
found by the trial Court, the value of the land is considerably more than that of the
kitchen, DUMLAO shall give written notice of such rejection to DEPRA and to the
Court within fifteen (15) days from notice of DEPRA's option to sell the land. In that
event, the parties shall be given a period of fifteen (15) days from such notice of
rejection within which to agree upon the terms of the lease, and give the Court
formal written notice of such agreement and its provisos. If no agreement is reached
by the parties, the trial Court, within fifteen (15) days from and after the termination
of the said period fixed for negotiation, shall then fix the terms of the lease, provided
that the monthly rental to be fixed by the Court shall not be less than Ten Pesos
(P10.00) per month, payable within the first five (5) days of each calendar month.
The period for the forced lease shall not be more than two (2) years, counted from
the finality of the judgment, considering the long period of time since 1952 that
DUMLAO has occupied the subject area. The rental thus fixed shall be increased by
ten percent (10%) for the second year of the forced lease. DUMLAO shall not make
any further constructions or improvements on the kitchen. Upon expiration of the

78
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 started exercising illegal possession of said portion of land
which contains an area of 200 square meters, more or less. 1
On 7 November 1972 the City Court of Olongapo City, Br. 4,2 dismissed Civil Case No.
926 on the ground that "it appears to the Court that the Bureau of Lands has
considered the area in question to be outside Lot 1641 of the plaintiff. . . ." 3 The
Decision of the City Court of Olongapo City became final and executory on 30 April
1973 when the then Court of First Instance of Zambales and Olongapo City, Br. 3, 4
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 within the boundaries of Lot No. 1641. 5
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 above-described
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
latter, including the portion in question. . . . 6
79
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 1978,7 the then Court of First Instance of Zambales, Br.
1,8 sustained the argument of Rosete and granted his motion to dismiss. Thereafter,
petitioner's motion for reconsideration was denied.9 Hence, this petition for review
on certiorari.
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 of action. 10 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 is not absolute but only substantial identity of parties. 11 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 appears that such party is not
a necessary party either in the first or second action, 12 or is a mere nominal party. 13
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 Case
No. 926 and Civil Case No. 2203-0.
Civil Case No. 926 is a complaint for forcible entry, where what is at issue is prior
possession, regardless of who has lawful title over the disputed property. 14 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 hand, violence or terror." 15 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 does not in any way bind the title or affect the ownership of the
land or building. 16
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 recover a parcel of land or an accion reivindicatoria under Art. 434 17 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
80
Rosete be ejected from the disputed land and that she be declared the owner and
given possession thereof. Certainly, the allegations partake of the nature of an accion
reivindicatoria. 18
19
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 metropolitan trial court; 20 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.
of possession, but by no means constitutes a bar to an action for determination of
who has the right or title of ownership. 23
And, applying the ruling of the Court En Banc in Quimpo v. De la Victoria, 24 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.

Accion reivindicatoria or accion de reivindicacion is thus an action whereby plaintiff

alleges ownership over a parcel of land and seeks recovery of its full possession. 21 It
is different from accion interdictal or accion publiciana where plaintiff merely alleges
proof of a better right to possess without claim of title. 22

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 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
81
G.R. No. 117389 May 11, 1995
ROMEO V. OBLEA and RAMON S. MELENCIO, petitioners,
vs.
COURT OF APPEALS and JUAN S, ESTEBAN, respondents.
BELLOSILLO, J.:
This is a petition for review on certiorari of the decision of the Court of Appeals
dismissing the petition for certiorari and prohibition and denying the prayer for a
writ of preliminary injunction against the order of 6 April 1994 of the Regional Trial
Court of Cabanatuan City, Br. 27, which lifted and cancelled the temporary
restraining order issued by Judge Lydia B. Hipolito of the Municipal Trial Court of
Cabanatuan City, Br. 9. 1
The controverted lot, designated as Lot 1, Block 2, was formerly a part of a mother
lot covered by TCT No. 26604 of the Register of Deeds of Cabanatuan City,
containing an area of 83,325 square meters and registered in the names of Manuel
Melencio (1/3), Pura Melencio (1/3) and Wilfredo Wico and Mariabelle M. Wico
(1/3). Subsequently, TCT No. 26604 was cancelled and in lieu thereof TCT No. 65031
was issued in the name of petitioner Ramon S. Melencio who became a co-owner
with Pura Melencio and the Wicos by virtue of a deed of sale executed in his favor by
his now deceased father Manuel Melencio.
On 6 June 1958 subject lot was bought by private respondent Juan S. Esteban from
Mauricio Ramos who claimed to have acquired the property from Ursula Melencio,
the alleged administratrix of the estate of Manuel and Pura Melencio. 2
Meanwhile, petitioner Romeo V. Oblea leased a building located on the subject lot
from a certain Marius Esteban, an alleged son of private respondent Juan S. Esteban.
Oblea eventually bought from Marius the lot on which the building stood.3 As a
consequence, on 4 July 1991 Esteban filed an ejectment suit against petitioner Oblea
in the Municipal Trial Court of Cabanatuan City docketed as Civil Case No. 10588. On
3 April 1992, the case was decided by Judge Romeo G. Mauricio in favor of Esteban
and against petitioner Oblea who was ordered to vacate the premises and pay rental
arrears from January 1983, as well as litigation expenses and attorney's fees in the
total sum of P8,000.00.
On appeal, the Regional Trial Court of Cabanatuan City rendered judgment on 26
March 1993 modifying the MTC decision by ordering Oblea to pay rentals only from
2 March 1988, but sustaining the MTC in other respects.
On 3 June 1993, the registered owners4 sold the disputed lot to petitioner Oblea.
Afterwards, Oblea together with Ramon Melencio, Pura Melencio and Wilfredo Wico
and Mariabelle Wico filed before the Regional Trial Court an action for quieting of
title against Esteban, docketed as Civil Case No. 1536. They contended that the
deeds of sale executed by Mauricio Ramos in favor of Juan Esteban and by Ursula
Melencio in favor of Mauricio Ramos were a nullity.
The ejectment case, Civil Case No. 10588, was in the meantime appealed to the
Court of Appeals by way of petition for review, which petition was dismissed by the
appellate court on 2 July 1993. Upon remand of the records to the court of origin,
and on motion of Esteban, the prevailing party, MTC Judge Hipolito directed
execution and issued the corresponding writ to enforce the final and executory
judgment in the ejectment suit.
The execution was however thwarted when petitioners Romeo Oblea and Ramon
Melencio filed another petition before the Regional Trial Court of Cabanatuan City
for certiorari and prohibition with application for a temporary restraining order and
preliminary injunction, docketed as Civil Case No. 1676-AF. On 22 November 1993
the Executive Judge thereof issued a temporary restraining order to stop the
enforcement of the writ of execution issued by Judge Hipolito. On 6 April 1994
however Judge Adriano I. Tuason, Acting Presiding Judge of Br. 27, lifted and
canceled the restraining order earlier issued, thus paving the way for the execution
of the judgment in the ejectment case.
Undeterred by the reversal, petitioners elevated their case to the appellate court
which on 27 September 1994 dismissed their appeal, the reason being that the
eviction case had long become final and executory and that the various actions taken
by petitioners were merely designed to delay execution.
We agree with respondent Court of Appeals.
The main argument of petitioners is that in view of the subsequent sale of the
controversial lot to them on 3 June 1993, and under the mistaken notion of
"doctrine of supervening event," they have acquired a better right of possession and
82
ownership. Hence, they argue that with this "supervening event," the judgment
evicting them can no longer be enforced.

The argument is untenable. It must be stressed that the sole issue in an action for
unlawful detainer is physical or material possession, i.e., possession de facto and not
possession de jure. This is settled doctrine. Resultantly, the pendency of an action for
quieting of title before the Regional Trial Court does not divest the city or municipal
trial court of its jurisdiction to proceed with the ejectment case over the same
property. The subsequent acquisition of ownership by petitioners is not a
supervening event that will bar the execution of the judgment in said unlawful
detainer case, the fact remaining that when judgment was rendered by the MTC in
the ejectment case, petitioner Oblea was a mere possessor of the subject lot.

Similarly, the fact that petitioners instituted a separate action for quieting of title is
not a valid reason for defeating the execution of the summary remedy of ejectment.
On the contrary., it bolsters the conclusion that the eviction case did not deal with
the issue of ownership which was precisely the subject matter of the action for
quieting of title before the Regional Trial Court of Cabanatuan City. 5 With the finality
of the decision in the ejectment case, execution in favor of the prevailing party has
become a matter of right; its implementation mandatory. It cannot be avoided. 6

In fine, the Court of Appeals did not commit reversible error in upholding the order
of 6 April 1994 which lifted the temporary restraining order enjoining the
implementation of the writ of execution in favor of private respondent Esteban.
Simply put, the petition is a desperate attempt on the part of petitioners to unduly
prolong the litigation of an issue which has been settled and should have been long
laid to rest.

WHEREFORE, the petition is DENIED. Costs against petitioner.

SO ORDERED.

83
G.R. No. 99846 May 22, 1995
BELEN CRUZ and HON. LUCIANO G. ELIZAGA, in his capacity as Presiding Judge of
Branch 101 RTC — Bulacan, petitioners,
vs.
FE ESPERANZA LEABRES, respondent.
ROMERO, J.:
This is a petition for review on certiorari of the decision1 of the Court of Appeals
dated April 30, 1991 which (1) annulled and set aside the injunction order of Judge
Luciano G. Elizaga of the Regional Trial Court of Bulacan in Civil Case No. 624-M-88,
and (2) ordered the Municipal Trial Court of Meycauayan, Bulacan to reinstate the
writ of execution in Civil Case No. 87-1377.
The facts show that private respondent Fe Esperanza Leabres acquired a parcel of
land with a two-door apartment on December 31, 1981 from its registered owners,
the spouses Roque David and Concordia Regoso. The latter executed a Deed of
Absolute Sale in favor of private respondent and a corresponding Transfer Certificate
of Title was issued in her name. No lis pendens or encumbrance of whatever form or
nature was annotated at the back of the title. Petitioner Belen Cruz Regoso, widow
of Concordia Regoso's father was an occupant of one of the units of the said
apartment at the time of the sale and continues to occupy the same up to the
present.
On September 26, 1986, private respondent asked petitioner to vacate the unit she
was occupying because private respondent needed to use it. Petitioner refused to
vacate the same and, as a consequence, private respondent filed a complaint for
ejectment with the Municipal Trial Court of Bulacan, branch I, docketed as Civil Case
No. 87-1377.
On March 28, 1988, the Municipal Trial Court of Meycauayan rendered judgment,
the dispositive portion of which reads:
WHEREFORE, with all the foregoing, judgment is hereby rendered in favor of the
plaintiff ordering:
1. the defendant and those claiming rights under her to vacate the premises in
question and restore possession to plaintiff;
2. the defendant to pay plaintiff actual damages in the amount of P2,000.00
exclusive of expenses in case of appeal;
3. the defendant to pay the sum of P5,000.00 for and as attorney's fees plus P300.00
as court appearance fees for every court attendance of herein plaintiff's retained
counsel; and
4. the costs of suit.
Further, the counterclaim of defendant is hereby dismissed for lack of merit.
SO ORDERED.
Petitioner appealed the decision to the Regional Trial Court of Bulacan, docketed as
Civil Case No. 193-M-88. On June 14, 1988, the said court rendered its decision
affirming in toto the decision of the Municipal Court.
Petitioner received the aforesaid decision on June 22, 1988 and on July 8, 1988, she
filed her motion for reconsideration, which was denied on September 6, 1988.
On September 21, 1988, petitioner filed a notice of appeal but the same was denied.
The decision having become final and executory, the Regional Trial Court of Bulacan,
Branch 22 issued an order dated October 5, 1988 remanding the case to the court of
origin.
On November 23, 1988, petitioner filed a civil action for the rescission of the sale
between the spouses Roque David and Concordia Regoso and Fe Esperanza Leabres
with damages and preliminary injunction with the RTC of Bulacan docketed as Civil
Case No. 624-M-88. On September 5, 1989, upon motion of private respondent, the
Municipal Trial Court of Meycauayan issued an order for the execution of its
judgment. The RTC issued a restraining order dated November 24, 1989 enjoining
the Municipal Trial Court of Meycauayan, from issuing a writ of execution of the
ejectment case.
On January 8, 1990, the RTC of Bulacan issued the assailed order for the issuance of
a writ of preliminary injunction, the dispositive portion of which reads as follows:
WHEREFORE, the writ of preliminary injunction prayed for is hereby granted and
84
1. The Presiding Judge of Branch I of the Municipal Trial Court of Meycauayan,
Bulacan is enjoined from taking further action in the implementation of its decision
dated March 8, 1988 in Civil Case No. 87-1377 entitled "Fe Esperanza Leabres vs.
Belen Regoso"; and
2. If a writ of execution has already been issued, the ex-oficio Provincial Sheriff of
Bulacan or any of her Deputies is enjoined from enforcing/implementing any writ of
execution issued in connection with the aforementioned MTC case and not to molest
or otherwise disturb plaintiff in the peaceful enjoyment and possession of the
property in question until further orders from this court.
SO ORDERED.
At this juncture, certain antecedent facts have become material. On February 14,
1969, petitioner purchased a parcel of land from the spouses Emmanuel Galang and
Rosalina Villegas. Petitioner caused the registration of the Deed of Sale, and
accordingly, Transfer Certificate of Title No. T-108088 was issued in the name of
Belen Cruz married to Maximo Regoso.
In July 1969, petitioner was made to sign a "Kasulatan ng Pagwawalang-bahala ng
Karapatan" renouncing whatever rights she had in her property and transferred the
same to her husband and Maximo Regoso.
A new Transfer Certificate of Title was then issued in the name of Maximo Regoso
married to Belen Cruz-Regoso. On October 23, 1979, he sold the property to the
spouses Roque David and Concordia Regoso, who in turn sold the property to private
respondent Leabres on December 31, 1981. The two-door apartment standing on
the said property was constructed out of the conjugal funds of petitioner and
Maximo Regoso. One door was leased since 1972 while the other was occupied by
petitioner up to the present.
While her husband was still alive, petitioner filed a case against him with the RTC of
Malolos, Bulacan on October 12, 1981 for partition with accounting and damages. He
died on January 17, 1985 while the case was pending.
On November 14, 1988, the court rendered a decision2 in said case finding that the
subject property now being litigated is paraphernal, and the improvement thereon
(the two-door apartment), conjugal. The said court also found that the "Kasulatan"
executed in July 1969 is a nullity as it runs counter to the pertinent provisions of the
Civil Code, namely Article 1333 and Article 14904 which provides, respectively, that all
donation's between spouses made during marriage shall be void and which prohibits
the husband and wife from selling their property to each other.
Since the "Kasulatan" could not have validly transferred the property in favor of
Maximo Regoso, the court held that he could not, in turn, sell the same in favor of
his daughter Concordia Regoso-David because the transfer to him was void.
When the case was appealed to the Court of Appeals by the Heirs of Maximo
Regoso, the same was dismissed by the appellate court on January 30, 1990.
The Heirs of Maximo Regoso then filed a petition for review on certiorari with this
Court docketed as G.R. No. 91879. We denied the said petition in a Decision
promulgated on July 6, 1992; hence the RTC decision of November 14, 1988
declaring the property in question as paraphernal property of the petitioner is now
final.
Meanwhile, Civil Case No. 624-M-88 for rescission was filed on November 23, 1988
by petitioner with the RTC of Bulacan, the same court which issued the now assailed
order of injunction.
After said order was issued, private respondent filed a petition for certiorari with the
Court of Appeals. On April 30, 1991, the appellate court annulled and set aside the
injunction order and ordered the Municipal Trial Court of Bulacan to reinstate the
writ of execution of the ejectment case against petitioner.
Hence, this petition.
Petitioner argues that when the Court of Appeals rendered the decision appealed
from, it failed to consider the supervening facts that occurred before and after the
Municipal Trial Court of Meycauayan, Branch I issued a writ of execution and that
these facts, if properly considered and evaluated, would result in a decision in her
favor.
We find the petition meritorious.
The principal issue to be resolved here is whether or not the Regional Trial Court of
Bulacan acted in excess of its jurisdiction or with grave abuse of discretion in
granting the writ of preliminary injunction which enjoined implementation of the
writ of execution issued by the Municipal Court.
85
Petitioner admits that the ejectment suit against her became final and executory on SO ORDERED.
September 21, 1988. However, she argues that the facts and circumstances that
occurred before and after the Municipal Court judgment make the case an exception
to Sec. 1, Rule 39 of the Rules of Court5 where the prevailing party is entitled as a
matter of right to the issuance of a writ of execution.

In Lee v. De Guzman Jr.,6 we said:

It is well-settled that when after a judgment has become final and executory, facts
and circumstances transpire which render its execution impossible or unjust, the
interested party may ask a competent court to stay its execution or prevent its
enforcement.

In Lipana v. Development Bank of Rizal,7 we enumerated the exceptions to the

general rule:

The rule that 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 vs. Geronimo, 59 O.G. 579);
whenever it is necessary to accomplish the aims of justice (Pascual vs. 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 vs. Adil, 135
SCRA 354).

In the instant case, the stay of execution of the judgment ejecting petitioner from
where she is staying is warranted by the fact that the transfer to her husband of the
said property and his subsequent sale thereof to his son-in-law and daughter had
been earlier declared null and void. To execute the judgment by ejecting petitioner
would result in an injustice, considering that the decision of November 14, 1988
declaring the property in question as her paraphernal property has already become
final.

Accordingly, respondent Judge did not gravely abuse his discretion in issuing the
assailed injunction order which was necessary to preserve the status quo between
the parties while the action for rescission of the sale was still being tried.

WHEREFORE, the decision of the Court of Appeals is hereby REVERSED and SET
ASIDE.

86
G.R. No. 83959 April 8, 1991
RUPERTO DE GUZMAN, petitioner
vs.
THE HONORABLE COURT OF APPEALS (SPECIAL FIFTEENTH DIVISION) and DR.
FORTUNATO V. CORREA, respondents.
Romeo R. Bringas for petitioner.
Public Attorney's Office for private respondent.
MEDIALDEA, J.:
The instant petition for review on certiorari seeks to set aside the decision of the
Court of Appeals dated May 11, 1988 (p. 17. Rollo) in CA-G.R. SP No. 11639 entitled
"Ruperto de Guzman vs. Hon. Gualberto J. dela Llana, Regional Trial Court, Branch
16, Malolos, Bulacan and Fortunato V. Correa," and its resolution dated June 22,
1988, denying petitioner's motion for reconsideration of said decision which
sustained the judgment of the Regional Trial Court, which in turn, affirmed an earlier
decision of the Municipal Trial Court of Angat, Bulacan ordering the ejectment of
herein petitioner (p. 25, Rollo).
The factual backdrop of the case is as follows:
Petitioner was the tenant of the late Teodora Villarama, mother of herein private
respondent, over a rice mill and a warehouse located in Angat, Bulacan. After the
expiration of the written lease contract on April 29, 1975, private respondent
allegedly took over the management of the premises and orally agreed with
petitioner that the lease over said premises shall be on a month to month basis.
Petitioner continued to occupy the premises but he failed to pay the monthly rentals
for May and June, 1977. Subsequently, private respondent notified petitioner that he
was terminating their agreement and demanded from petitioner the return of the
subject premises. Because of petitioner's failure to comply with his demand, private
respondent filed an ejectment case against the former before the Municipal Trial
Court of Angat, Bulacan docketed as Civil Case No. 183. On June 29, 1978, the trial
court rendered a decision in favor of private respondent and on December 28, 1978,
the trial court issued an order declaring the said decision final and executory.
On June 29, 1979, petitioner filed with the Court of First Instance (now Regional Trial
Court) of Bulacan a petition for relief from judgment and order with prayer for
preliminary injunction to restrain the enforcement of the writ of execution issued.
On the date set for the hearing for the issuance of a writ of preliminary injunction,
petitioner filed with the same trial court a petition for certiorari, prohibition and
mandamus with restraining order, injuction and damages against private
respondent, docketed as Special Civil Action SM-960. Pending resolution of said
petition, a restraining order was issued and petitioner was ordered to post an
injunction bond and to deposit rentals. Acting on said petition, the trial court
declared null and void, the proceedings held in Civil Case No. 183 and ordered the
dismissal of the case in view of the lack of the requisite demand under Section 2,
Rule 70, Rules of Court.
Subsequently, private respondent again filed with the Municipal Trial Court of Angat,
Bulacan, another ejectment case against petitioner, this time docketed as Civil Case
No. 286. The trial court, in a decision dated October 16, 1984, ordered petitioner to
vacate the leased premises; to pay private respondent a monthly rental in the
amount of P175.00 starting May 1977 until petitioner vacates the premises with 14%
interest per annum until fully paid; to pay private respondent the sum of P10,000.00
as moral damages, P5,000.00 as exemplary damages, P5,000.00 as attorney's fees
and costs of the proceedings.
On November 14, 1984, petitioner filed in Special Civil Action No. SM-960, which was
reassigned to Regional Trial Court, Branch 16, Malolos, Bulacan after the judicial
reorganization, a petition for contempt with restraining order and injunction to
prevent the execution of the above decision. This petition was considered by said
court as a petition for certiorari, prohibition and restraining order with damages, and
on the same date, it issued an order restraining the execution of the decision until
further orders (p. 21, Rollo)
Meanwhile, petitioner's appeal from the aforesaid decision docketed as Civil Case
No. 7903-M was also raffled to the same branch of the Regional Trial Court, presided
by then Judge Gualberto dela Llana, who, in a decision dated April 11, 1986,
sustained the judgment of the Municipal Trial Court.
After petitioner's motion for reconsideration of the April 11, 1986 decision was
denied, he filed with the Court of Appeals, a petition for certiorari, prohibition and
mandamus wherein he alleged that, in affirming the decision of the Municipal Trial
Court, the Regional Trial Court acted with grave abuse of discretion amounting to
87
lack of jurisdiction or, was without or, in excess of jurisdiction, considering that Civil
Case No. 286 should have been dismissed on the grounds of lack of jurisdiction, litis
pendencia, and lack of cause of action.
In a decision dated May 11, 1988, respondent court dismissed the petition for lack of
merit (Annex "A", p. 17, Rollo). In dismissing the petition, respondent court held that
the decision of the Regional Trial Court in Special Civil Action No. SM-960 was not an
adjudication on the merits as the dismissal of Civil Case No. 183 was by reason of
lack of demand as required in Section 2, Rule 70 of the Rules of Court, hence the
Municipal Trial Court had no jurisdiction. Accordingly, it said that litis pendencia
cannot act as a bar to a new complaint when the judge who took cognizance of the
former complaint was disqualified by reason of lack of jurisdiction over the subject
matter thereof and in order that the defense of litis pendencia may be set up, it is
necessary that the judge who took cognizance of the first case should also have
jurisdiction over the subject matter of the same. Respondent court also found out
that the written lease contract was never renewed up to the death of the mother of
private respondent. This being so, it ruled that said contract automatically expired at
the end of the period covered without need of demand. It also held that petitioner
failed to show by what right he continued to occupy the premises as private
respondent owned the premises by virtue of TCT No. 178491, issued to him on
February 9, 1973. With the denial of his motion for reconsideration, petitioner is now
before this Court for a review of the above adverse decision.
Contending once again that the decision of the Municipal Trial Court in the second
ejectment case which was affirmed by the Regional Trial Court and respondent court
was rendered without or in excess of jurisdiction, petitioner alleged that the
premises and the deposited rentals were the same matters pending disposition in
Special Civil Action No. SM-960 before the Regional Trial Court, Branch 16 of
Malolos, Bulacan where the motions filed by private respondent for the delivery to
him of the deposited rentals were denied by the Regional Trial Court. He argued that
the Municipal Court, therefore, did not have jurisdiction to pre-empt the former
court from disposing of those matters and to reverse the Regional Trial Court's
rulings to the effect that the estate of the late Teodora Villarama was entitled to
receive the premises and the rentals.
This contention is entirely devoid of merit, if not misleading.1âwphi1 It must be
stressed that Special Civil Action No. SM-960 was an independent action brought to
annul or modify the proceedings held in the first ejectment case and to restrain the
enforcement of the writ of execution on the ground that the decision of the
Municipal Court was rendered without or in excess of its jurisdiction or with grave
abuse of discretion. True, the petition was granted and the first ejectment case was
dismissed. However, its dismissal in SM-960 cannot be pleaded as a bar to the
second ejectment case as the dismissal was only due to non-compliance with the
jurisdictional requisite of demand under Section 2, Rule 70 of the Rules of Court. The
fact that petitioner was ready and willing to return the leased premises and to have
the deposited rentals delivered to the private respondent in said SM-960 provided
private respondent submits a quitclaim executed by all the other heirs of the lessor,
Teodora Villarama, cannot prevent respondent from taking the proper legal action to
obtain whatever cause of action he may have against petitioner. The matter of
disposition of rentals in SM-960 is a personal undertaking of petitioner that is distinct
and separable from the issue in said case. It is, therefore, incorrect for petitioner to
argue that said court still had jurisdiction over the matter which bars other courts
from taking cognizance. SM-960 is already a terminated case. Thus, neither can the
defense of litis pendencia be pleaded.
Equally untenable is petitioner's argument that private respondent did not have a
cause of action against him because the written lease contract was between him and
the deceased mother of the former. Private respondent holds absolute title over the
subject premises by virtue of TCT No. 178491 issued to him in February 9, 1973.
Clearly then, the essential elements of a valid cause of action existed in favor of
private respondent namely: 1) his right to demand from petitioner payment of rent
for the use and occupation of the premises; 2) the correlative obligation of petitioner
to pay rent; 3) the act of petitioner in refusing to pay rent and vacate the premises in
violation of said right. Petitioner's argument that he is not unlawfully withholding
possession of the leased premises from private respondent and that he has acted in
good faith as an officious manager under the concept of negotiorum qestio, entitled
to an honorium of P200.00 a month from May, 1980 until the proper parties, the
successors-in-interest of Teodora Villarama, or her estate receive the property was
correctly brushed aside by respondent Court of Appeals. Indeed, if this Court were to
sustain said claim, it would bring about the anomalous and absurd situation wherein
petitioner would continue occupying and enjoying the leased premises while getting
paid for it.
Petitioner further claims that the Regional Trial Court did not have jurisdiction to
decide the appeal because he had abandoned the same when he failed to set aside
the decision rendered in the second ejectment case, which was given due course by
the issuance of a restraining order. He said that the appeal (Civil Case No. 7903,) was
88
originally assigned to the Regional Trial Court Branch X but was consolidated with
SM-960 without any order of consolidation and it was decided without notice for
oral arguments or to file memoranda in lieu thereof.
This claim deserves scant consideration. Under the pretext of having filed a petition
for certiorari, prohibition, mandamus and contempt (which is false because what
petitioner filed in SM-960 was a petition for contempt with restraining order and
injunction; p. 76, Rollo), he now professed to have abandoned the appeal he had
perfected earlier. Petitioner's inconsistent positions unraveled his true intention and
that was to delay the early execution of the decision in the second ejectment case.
Even assuming that he filed said petition in SM-960, said remedy was ineffective to
obtain relief from the effects of the decision in the second ejectment case
considering that SM-960 was already terminated.
The petitioner failed to rebut the propriety of the award of attorney's fees before
the Municipal Trial Court on the ground that private respondent was compelled to
incur expenses to protect his interest as a result of petitioner's failure to vacate the
premises (Article 2208 (2) Civil Code). The simple allegation that private respondent
was represented by a brother-in-law does not prove anything.
ACCORDINGLY, the petition is hereby DENIED and the questioned decision is
AFFIRMED but with the modification that the award of moral and exemplary
damages be deleted. Costs against petitioner.
SO ORDERED.

The lack of an approved order for the consolidation of his appeal and that of SM-960
did not also affect the jurisdiction of the Regional Trial Court to decide the appeal. It
must be stressed that these remedies are distinct and separate in nature and
purpose. Basically, petitioner's appeal from the decision in the second ejectment
case involved a review of said decision on the merits while SM-960 was intended to
correct the jurisdictional error of the Municipal Trial Court, in taking cognizance of
the first ejectment case and to compel dismissal of the same by reason of said error.

Lastly, petitioner assails the appealed decision as requiring him to pay double rent
and also to pay rent from 1980 when he was ready to turn over the premises to the
legal representative of the late Teodora Villarama. He further questioned the award
of moral and exemplary damages and attorney's fees as contrary to prevailing
jurisprudence in ejectment cases.

The matter of payment of double rent is utterly baseless.1âwphi1 The injunction

bond which was required of petitioner in Special Civil Action No. SM-960 was
cancelled in the decision rendered in said case, dated January 11, 1980 (see
Resolution on Motion for Reconsideration, pp. 25-26, Rollo). However, the affirmed
award of moral and exemplary damages is erroneous. The only damages that can be
recovered in an ejectment suit are the fair rental value or the reasonable
compensation for the use and occupation of the real property (Felisida vs. Judge
Villanueva, No. 60372, October 29, 1985, 139 SCRA 431; Reyes vs. CA, L-28466,
March 27, 1971, 38 SCRA 138; Ramirez vs. Chit, L-22032, December 26, 1967, 21
SCRA 1364).

89
G.R. No. 116665 March 20, 1996
MELQUIADES D. AZCUNA, JR., petitioner,
vs.
COURT OF APPEALS, ET. AL., respondents.
FRANCISCO, J.:p
Under a one (1) year lease contract commencing on July 1, 1992 and ending on June
30, 1993 but renewable upon agreement, herein petitioner Azcuna, Jr., as lessee,
occupied three (3) units (C, E and F) of the building owned by private respondent
Barcelona's family. Came expiration date of the lease without an agreed renewal
thereof and coupled by petitioner's failure to surrender the leased units despite
private respondent's demands, private respondent filed before the Municipal Trial
Court an ejectment case against petitioner. Judgment of that inferior court, affirmed
in its entirety by the Regional Trial Court and herein public respondent Court of
Appeals on subsequent appeals taken by petitioner, favored private respondent, the
decretal portion of which reads:
PREMISES CONSIDERED, judgment is hereby rendered in favor of the plaintiff,
Ernesto E. Barcelona, ordering the defendant Melquiades D. Azcuna, Jr., and all
persons claiming rights under him to vacate the premises known as Units C, E and F,
in the building owned by plaintiff's family located along Congressional Avenue,
Quezon City. Defendant is likewise ordered to pay the following:
1. The sum of P25,000.00 monthly as rental for continued use by defendant of the
three (3) units of leased premises in question starting July 1, 1993 less the amount
that have been deposited or given by the defendant to the plaintiff up to such time
the defendant and all persons claiming rights under him finally vacate the aforesaid
premises;
2. The further sum of P3,000.00 per day, by way of damages for his failure to turn
over peacefully the three (3) commercial spaces to the plaintiff from July 1, 1993
until such time the defendant and all persons claiming rights under him vacate the
premises;
3. The further sum of P5,000.00 by way of attorney's fees; and
4. The cost of this suit.
The counter-claim of the defendant is hereby Dismissed, for lack of merit.
SO ORDERED.
Petitioner now comes to the Court via the instant petition not to contest his ouster
from the leased premises nor the amount monthly rental he was adjudged to pay
until he vacates the same, but only to take particular exception to respondent CA's
decision insofar as it affirmed the municipal trial court's award of P3,000.00 per day
as damages (sub-paragraph 2 of the dispositive portion just quoted). It is petitioner's
claim that such award, in addition to the fair rental value or reasonable
compensation for the use and occupation of the premises (sub-paragraph 1), is
improper in the light of the doctrine enunciated in the cases of "Felesilda v.
Villanueva,"1 "Shoemart, Inc. v. CA"2 and "Hualam Construction and Development
Corp. v. CA"3 cited by petitioner, that "the only damages that can be recovered in an
ejectment suit are the fair rental value or the reasonable compensation for the use
and occupation of the real property. Other damages must be claimed in an ordinary
action".
Petitioner's reliance on such doctrine is misplaced, inasmuch as the "Felesilda,"
"Shoemart" and "Hualam" cases dealt with additional damages and charges other
than liquidated damages, defined as ". . . those agreed upon by the parties to a
contract, to be paid in case of breach thereof ".4 Here, the municipal trial court, in
making the "P3,000.00 per day" award, was merely enforcing what was stipulated
upon in black and white by private respondent-lessor and petitioner-lessee
appearing in paragraph 10 of the lease contract which reads:
That after the termination of the Lease, the LESSEE shall peaceably deliver to the
LESSOR the leased premises vacant and unencumbered and in good tenantable
conditions minus the ordinary wear and tear. In case the LESSEE's failure or inability
to do so, LESSOR has the right to charge the LESSEE P1,000.00 per day as damages
without prejudice to other remedies which LESSOR is entitled in the premise.
(Emphasis supplied).
This is clearly an agreement for liquidated damages — entitling private respondent
to claim a stipulated amount by way of damages (correctly totalling P3,000.00 per
day as there were three (3) units being leased by petitioner) over and above other
damages still legally due him, i.e., the fair rental value for the use and occupation of
90
the property as provided for in Section 8, Rule 70 of the Rules of Court. The freedom
of the contracting parties to make stipulations in their contract provided they are not
contrary to law, morals, good customs, public order or public policy is so settled, and
the Court finds nothing immoral or illegal with the indemnity/penalty clause of the
lease contract (paragraph 10) which does not appear to have been forced upon or
fraudulently foisted on petitioner. Petitioner cannot now evade further liability for
liquidated damages, for "after entering into such an agreement, petitioner cannot
thereafter turn his back on his word with a plea that on him was inflicted a penalty
shocking to the conscience and impressed with iniquity as to call for the relief sought
on the part of a judicial tribunal."5

The controlling case here is, as correctly invoked by private respondent, "Gozon v.
Vda. de Barrameda"6 which involved similar facts and the same issue raised by herein
petitioner. There, the then Court of First Instance of Rizal affirmed the judgment of
the then justice of the peace court of Caloocan in a detainer case ordering
defendant-appellant Barrameda to pay complainant Gozon the sum of P1,622.43 as
rentals due up to July 3, 1958 plus P5,000.00 as liquidated damages, and costs.
Appellant Barrameda likewise assailed the propriety of the P5,000.00 award in
addition to the rentals. The Court upheld the then CFI's affirmatory decision by
disposing of appellant Barrameda's protestation in this wise:

This Court has often stated that inferior courts have exclusive jurisdiction over cases
of forcible entry and detainer regardless of the value of damages demanded. It has
also ruled that the damages that may be recovered in actions for ejectment are
those equivalent to a reasonable compensation for the use and occupation of the
premises by defendant. Nonetheless, this latter legal proposition is not pertinent to
the issue raised in the instant case because here, the damage sought to be recovered
had previously been agreed to by lessee (in the contract of lease) and imposed by
lessor by way of damages. Besides, nobody can affirm that the liquidated amount of
damages stipulated in the lease contract was not due to occupation or loss of
possession of the premises and non-compliance with the contract. (Emphasis
supplied).

WHEREFORE, the instant petition for review by way of certiorari is hereby DENIED.

SO ORDERED.

91
G.R. No. 123555 January 22, 1999
PROGRESSIVE DEVELOPMENT CORPORATION, INC., petitioner,
vs.
COURT OF APPEALS and WESTIN SEAFOOD MARKET, INC. respondents.
BELLOSILLO, J.:
May the lessee which instituted before the Metropolitan Trial Court an action for
forcible entry with damages against its lessor file a separate suit with the Regional
Trial Court against the same lessor for moral and exemplary damages plus actual and
compensatory damages based on the same forcible entry?
On grounds of litis pendencia and forum-shopping petitioner invokes established
jurisprudence that a party cannot by varying the form of action or adopting a
different method of presenting his case evade the principle that the same cause of
action shall not be litigated twice between the same parties or their privies. 1
Petitioner therefore prays for reversal of the decision of the Court of Appeals dated
27 May 1995, as well as its Resolution dated 17 January 1996 denying
reconsideration, which upheld the denial by the Regional Trial Court of petitioner's
motion to dismiss private respondent's damage suit.
The antecedents: On 27 May 1991 petitioner leased to private, respondent Westin
Seafood Market, Inc., a parcel of land with a commercial building thereon located at
Aranet Center, Cubao, Quezon City, for a period of nine (9) years and three (3)
months, i.e., from 2 January 1989 to 30 April 1998, with a monhtly rental of
approximately P600,000.00. The contract contained, among others, the following
pertinent terms and conditions:
EFFECT OF VIOLATIONS
25. LESSEE hereby agrees that all the provisions contained in this Contract shall be
deemed as conditions, as-well as covenants, and that this Contract shall be
automatically terminated and cancelled without resorting to court action should
LESSEE violate any or all said conditions, including the payment of Rent, CUSA and
other charges indicated in the FLP when due within the time herein stipulated and in
any such cases, LESSEE hereby irrevocably appoints LESSOR, its authorized agents,
employees and/or representatives as his duly authorized attorney-in-fact, even after
the termination, expiration or cancellation of this Contract, with full power and
authority to open, enter, repossess, secure, enclose, fence and otherwise take full
and complete physical possession and control of the leased premises and its
contents without resorting to court action and/or to summarily disconnect electrical
and/or water services thereof, and that LESSEE hereby irrevocably empowers
LESSOR, his authorized agents, employees and/or representatives to take inventory
and possession of whatever equipment, furniture, articles, merchandise, appliances,
etc., found therein belonging to LESSEE, consignors and/or to any other persons and
to place the same in LESSOR's warehouse or any other place at LESSOR's discretion
for safekeeping; charging LESSEE the corresponding storage fees therefor; that in
case LESSEE fails to claim-said equipment, furniture, articles, merchandise,
appliances, etc. from storage and simultaneously liquidate any liability with LESSOR
within seven (7) days from date of said transfer to LESSOR's warehouse, LESSOR is
likewise hereby expressly authorized and empowered by LESSEE to dispose of said
property/properties in a public sale through a Notary Public of LESSOR's choice and
to apply the proceeds thereof to whatever liability and/or indebtedness LESSEE may
have to LESSOR plus reasonable expenses for the same, including storage fees, and
the balance, if any, shall be turned over to LESSEE; that LESSEE hereby expressly
agrees that any or all acts performed by LESSOR, his authorized agents, employees
and/or representatives under the provisions of this Section may not be the subject of
any petition for a Writ of Preliminary Injunction or Mandatory Injunction in court,
and that LESSOR and/or his authorized agents, employees, and/or representatives
shall be free from any civil and/or criminal liability or responsibility whatsoever
therefor.
TERMINATION OF LEASE
26. Upon-the automatic termination of this lease contract, as the case may be,
LESSEE shall immediately vacate and redeliver physical possession of the leased
premises, including the keys appertaining thereto, to LESSOR in good, clean and
sanitary condition, reasonable wear and tear excepted, devoid of all occupants,.
equipment, furnitures articles, merchandise, etc., belonging to LESSEE or to any
other person except those belonging to LESSOR; that should LESSEE fail to comply
with this provision, LESSOR is hereby given the same rights and power to proceed
against LESSEE as expressly granted in the immediately; preceding section.
Private respondent failed to pay rentals despite several demands by petitioner. As of
19 October 1992 the arrearages amounted to P8,608,284.66. Admittedly, non-
payment of rentals constituted breach of their contract; thus, pursuant to the
92
express authority granted petitioner under the above-quoted Secs. 25 and 26 of the
lease agreement, petitioner on 31 October 1992 repossessed the leased premises,
inventoried the movable properties found within and owned by private respondent
and scheduled public auction for the sale of the movables on 19 August 1993 with
notice to private respondent.
On 26 November 1992 private respondent filed with the Metropolitan Trial Court of
Quezon City a complaint against petitioner for forcible entry with damages and a
prayer for a temporary restraining order and/or writ of preliminary injunction. 2 The
case was raffled to Branch 40 presided over by Judge Guillermo L. Loja Jr. who issued
a temporary restraining order enjoining petitioner from selling private respondent's
properties at a public auction.
On 9 December 1992 Judge Loja inhibited himself from trying the case and directed
its transfer to Branch 34 presided over by Judge Joselito SD Generoso. Soon after,
petitioner filed an urgent motion for the inhibition of Judge Generoso and the
immediate reraffle of the case arguing that the summary transfer of the case to
Judge Generoso was irregular as it was not done by raffle.
The motion was granted and the case went to Branch 36 presided over by Judge
Francisco D. Villanueva. Thereafter, on 22 December 1992, at the continuation of the
hearing on the issuance of a writ preliminary mandatory injunction, the parties
agreed, among others, on the following: (a) private respondent would deposit with
the Philippine Commercial and Industrial Bank in the name of the Metropolitan Trial
Court, Branch 36, the amount of P8,000,000.00 to guarantee the payment of its back
rentals; (b) petitioner would defer the sale of the personal properties of the Westin
Seafood Market, Inc., until a final settlement of the case had been arrived, at; (c)
petitioner shall allow private respondent to retrieve all the perishable goods from
inside the leased premises like frozen meat, vegetables and fish, all properly
receipted for; (d) petitioner shall allow three (3) maintenance personnel of private
respondent to enter the premises at reasonable working hours to maintain the
restaurant equipment; and (e) the parties shall negotiate for the restoration of the
premises to private respondent, and if no settlement be arrived at on or before
January 8, 1993, the hearing on the merits of the case shall proceed and the
disposition of the amount deposited representing the rental arrearages shall be left
to the. discretion of the court.
This agreement was incorporated in the order of the court dated 22 December 1992
3
which in effect terminated for all intents and purposes the incident on the issuance
of a preliminary writ of injunction.
Private respondent did not comply with its undertaking to deposit with the
designated bank the amount representing its back rentals. Instead, with the forcible
entry case still pending with the MeTC, private respondent instituted on 9 June 1993
another action for damages against petitioner with the Regional Trial Court of
Quezon City. The case was raffled to Branch 101 presided over by Judge Pedro T.
Santiago. 4
Petitioner filed a motion, to dismiss the damage suit on the ground of litis pendencia
and forum shopping. On 2 July 1993, instead of ruling on the motion, Judge Santiago
issued an order archiving the case pending the outcome of the forcible entry case
being heard at the MeTC for the reason that "the damages is (sic) principally
anchored on whether or not the defendants (petitioner herein) have committed
forcible entry." 5 On 2 August 1993 petitioner moved for reconsideration of the order
and reiterated its motion to dismiss the suit for damages.
Before petitioner's motion to dismiss could be resolved, private respondent filed
with the RTC on 18 August 1993 an amended complaint for damages. On 14
September 1993 it also filed an Urgent Ex-Parte Motion for the Issuance of a
Temporary Restraining Order and Motion for the Grant of a Preliminary Prohibitory
and Preliminary Mandatory Injunction. On the very same day, Judge Santiago issued
an order (a) denying petitioner's motion to dismiss, (b) admitting private
respondent's amended complaint, and (c) granting private respondent's application
for a temporary restraining order against petitioner.
Thus, petitioner filed with the Court of Appeals a special civil action for certiorari and
prohibition on the ground that Judge Santjago acted in excess of his jurisdiction
and/or committed grave abuse of discretion amounting to lack of jurisdiction in
admitting, the amended complaint of private respondent and issuing a restraining
order against petitioner; in allowing private respondent to engage in forum
shopping; and, taking cognizance of the action; for damages despite lack of
jurisdiction. 6
But the Court of Appeals dismissed the petition due to the failure of petitioner to file
a motion for reconsideration of Judge Santiago's order of 14 September 1993 which,
it explained, was a prerequisite to the institution of a petition for certiorari and
93
prohibition. It also found that the elements of litis pendencia were lacking to justify
the dismissal of the action for damages with the RTC because despite the pendency
of the forcible entry case with the MeTC the only damages recoverable thereat were
those caused by the loss of the use and occupation of the property and not the kind
of damages being claimed before the RTC which had no direct relation to loss of
material possession. It clarified that since the damages prayed for in the amended
complaint with the RTC were those caused by the alleged high-handed manner with
which petitioner reacquired possession of the leased premises and the sale of
private respondent's movables found therein, the RTC and not the MeTC had
jurisdiction over the action of damages. 7
Petitioner, aggrieved by the decision of the appellate court, filed the instant petition
for review on certiorari under Rule 45 of the Rules of Court alleging that it erred in
(a) finding that petitioner failed to avail of its plain, speedy and adequate remedy of
a prior motion for reconsideration with the RTC; (b) ruling that, the trial judge did not
act with grave abuse of discretion in taking cognizance of the action for damages and
injunction despite the pendency of the forcible entry case with the MeTC; and, (c)
ruling that private respondent did not commit forum shopping since the causes of
action before the RTC and MeTC were not identical with each other.
There is merit in the petition. While generally a motion for reconsideration must first
be filed before resorting to certiorari in order to give the lower court an opportunity
to correct the errors imputed to it 8 this rule admits of exceptions and is not
intended to be applied without considering the circumstances of the case. 9 The filing
of the motion for reconsideration before availing of the remedy of certiorari is not
sine qua non when the issue raised is one purely of law, 10 or where the error is
patent or the disputed order is void, 11 or the questions raised on certiorari are the
same as those already squarely presented to and passed upon by the lower court
In its motion for dismissal of the action for damages with the RTC petitioner raised
the ground that another action for forcible entry was pending at the MeTC between
the same parties involving the same matter and cause of action. Outrightly rejected
by the RTC, the same issue was elevated by petitioner on certiorari before the Court
of Appeals. Clearly, under the prevailing circumstance, any motion for
reconsideration of the trial court would have been a pointless exercise. 12
We now turn to the issue of whether an action for damages filed with the Regional
Trial Court by the lessee against the lessor should be dismissed on the ground of
pendency of another action for forcible entry and damages earlier filed by the same
lessee against the same lessor before the Metropolitan Trial Court.
Sec. 1 of Rule 70 of the Rules of Court provides that any person deprived of the
possession of any land or building by force, indimidation, threat, strategy or stealth,
or against whom thepossession of any land or building is unlawfully withheld, may
bring an action in the proper Municipal Trial Court against the person or persons
unlawfully withholding or depriving of possession, together with damages and costs.
The mandate under this rule is categorical: that all cases for forcible entry or
unlawful detainer shall be filed before the Municipal Trial Court which shall include
not only the plea for restoration of possession but also all claims for damages and
costs arising therefrom. Otherwise expressed, no claim for damages arising out of
forcible entry or unlawful detainer may be filed separately and independently of the
claim for restoration of possession.
This is consistent with the principle laid down in Sec. 1, par. (e), of Rule 16 of the
Rules of Court which states that the pendency of another action between the same
parties for the same cause is a ground for dismissal of an action. Res adjudicata
requires that there must be between the action sought to be dismissed and the
other action the following elements: (a) identity of parties or at least such as
representing the same interest in both actions; (b) identity of rights asserted and
relief prayed for, the relief being founded on the same facts; and, (c) the identity in
the two (2) preceding particulars should be such that any judgment which may be
rendered on the other action will, regardless of which party is successful, amount to
res adjudicata in the action under
consideration. 13
It is likewise basic under Sec. 3 of Rule 2 of the Revised Rules of Court, as amended,
that a party may not institute more than one suit for a single cause of action. Under
Sec. 4 of the same Rule, if two or more suits are instituted on the basis of the same
cause of action, the filing of one or a judgment upon the merits in any one is
available as a ground for the dismissal of the other or others. "Cause of action" is
defined by Sec. 2 of Rule 2 as the act of omission by which a party violates a right of
another. 14 These premises obtaining, there is no question at all that private
respondent's cause of action in the forcible entry case and in the suit for damages is
the alleged illegal retaking of possession of the leased premises by the lessor,
petitioner herein, from which all legal reliefs arise. Simply stated, the restoration of
possession and demand for actual damages in the case before the MeTC and the
94
demand for damages with the RTC both arise from the same cause of action, i.e., the
forcible entry by petitioner into the least premises.
A comparative study of the two (2) complaints filed by private respondent against
petitioner before the two (2) trial courts shows that not only are the elements of res
adjudicata present, at least insofar as the claim for actual and compensatory
damages is concerned, but also that the claim for damages — moral and exemplary
in addition to actual and compensatory — constitutes splitting a single cause of
action. Since this runs counter to the rule against multiplicity of suits, the dismissal of
the second action becomes imperative.
The complaint for forcible entry contains the following pertinent allegations —
2.01 On 02 January 1989, plaintiff entered, into a contract of lease with defendant
PDC over a property designated as Ground Floor, Seafood Market (hereinafter
"Subject Premises") situated at the corner of EDSA, corner MacArthur Street,
Araneta Center, Cubao, Quezon City, for a period of ten (10) years from 02 January
1989 to 30 April 1998.
2.02 Immediately after having acquired actual physical possession of the Subject
Premises, plaintiff established and now operates thereon the now famous Seafood
Market Restaurant. Since then, plaintiff had been in actual, continuous, and peaceful
physical possession of the Subject Premises until 31 October 1992.
xxx xxx xxx
3.02 Plaintiff, being the lessee of the Subject Premises, is entitled to the peaceful
occupation and enjoyment of the Subject Premises to the exclusion of all others,
including defendants herein.
3.03 Defendants' resort to strong arms tactics to forcibly wrest possession of the
Subject Premises from plaintiff and maintain possession thereof through the use of
force, threat, strategy and intimidation by the use of superior number of men and
arms amounts to the taking of the law into their own hands.
3.04 Thus, defendants' act of unlawfully evicting out plaintiff from the Subject
Premises it is leasing from defendant PDC and depriving it of possession thereof
through the use of force, threat, strategy and intimidation should be condemned and
declared illegal for being contrary; to public order and policy.
3.05 Consequently, defendants should be enjoined from continuing with their illegal
acts and be ordered to vacate the Subject Premises and restore possession thereof,
together with its contents, to plaintiff.
xxx xxx xxx
4.07 Considering that defendants' act of forcibly grabbing possession of the Subject
Premises from plaintiff is illegal and null and void, defendant should be adjudged
liable to plaintiff for all the aforedescribed damages which plaintiff incurred as a
result thereof.
The amended complaint for damages filed by private respondent alleges basically
the same factual circumstances and issues as bases for the relief prayed for, to wit:
4. On May 28, 1991, plaintiff and defendant PDC entered into a Contract of Lease for
a period of ten years or from January 2, 1989 up to April 30, 1998 over a property
designated as Ground Floor, Seafood Market (hereinafter referred to as Subject
Premises) situated at the corner of EDSA corner McArthur Street, Araneta Center,
Cubao, Quezon City. A copy of the lease contract is attached hereto as Annex "A".
5. Immediately thereafter, plaintiff took over actual physical possession of Subject
Premises, and established thereon the now famous "Seafood Market Restaurant."
xxx xxx xxx
7 On October 31, 1992 at around 8:30 p.m., defendant PDC, without the benefit of
any writ of possession or any lawful court order and with the aid of approximately
forty (40) armed security guards and policemen under the supervision of defendant
Tejam, forcibly entered the subject premises through force, intimidation, threats and
stealth and relying on brute force and in a thunderboltish manner and against
plaintiff's will, unceremoniously drew away all of plaintiff's men out of the subject
premises, thereby depriving herein plaintiff of its actual, physical and natural
possession of the subject premises. The illegal, high-handed manner and gestapo like
take-over by defendants of subject premises is more particularly described as
follows: . . .
8. To date, defendants continue to illegally possess and hold the Subject Premises,
including all the multi-million improvements, fixtures and equipment therein owned
by plaintiff, all to the damage and prejudice of plaintiff. The actuations of defendants
constitute an unlawful appropriation, seizure and taking of property against the will
95
and consent of plaintiff. Worse, defendants are threatening to sell at public auction
and without the consent of plaintiff and without lawful authority, the multi-million
fixtures and equipment of plaintiff and at prices way below the market value thereof.
Plaintiff hereby attaches as Annex "B" the letter from defendants dated August 6,
1993 addressed to plaintiff, informing the latter that the former intends to sell at an
auction on August 19, 1993 at 2:00 p.m. properties of the plaintiff presently in
defendants' possession.
xxx xxx xxx
12. Defendants' unlawful takeover of the premises constitutes a violation of its
obligation under Art. 1654 of the New Civil Code requiring the lessor to maintain the
lessee in peaceful and adequate enjoyment of the lease for the entire duration of
the contract. Hence, plaintiff has filed the present suit for the recovery of damages
under Art. 1659 of the New Civil Code. . . .
Restated in its bare essentials, the forcible entry case has one cause of action,
namely, the alleged unlawful entry by petitioner into the leased premises out of
which three (3) reliefs (denominated by private respondent as is causes of action)
arose: (a) the restoration by the lessor (petitioner herein) of the possession of the
leased premises to the lessee; (b) the claim for actual damages due to the losses
suffered by private respondent such as the deterioration of perishable foodstuff
stored inside the premises and the deprivation of the use of the premises causing
loss of expected profits; and, (c) the claim for attoney's fees and cost of suit.
On the other hand, the complaint for damages prays for a monetary award
consisting of (a) moral damages of P500,000.00 and exemplary damages of another
P500,000.00; (b) actual damages of P20,000,000.00 and compensatory damages of
P1,000,000.00 representing unrealized profits; and, (c) P200,000.00 for attorney's
fees and costs, all based on the alleged forcible takeover of the leased premises by
petitioner. Since actual and compensatory damages were already prayed for in the
forcible entry case before the MeTC, it is obvious that this cannot be relitigated in
the damage suit before the RTC by reason of res adjudicata.
The other claims for moral and exemplary damages cannot also succeed considering
that these sprung from the main incident being heard before the MeTC.
Jurisprudence is unequivocal that when a single delict or wrong is committed — like
the unlawful taking or detention of the property of the another — there is but one
single cause of action regardless of the number of rights that may have been violated,
and all such rights should be alleged in a single complaint as constituting one single
cause of action. 15 In a forcible entry case, the real issue is the physical possession of
the real property. The question of damages is merely secondary or incidental, so
much so that the amount thereof does not affect the jurisdiction of the court. In
other words, the unlawful act of a deforciant in taking possession of a piece of land
by means of force and intimidation against the rights of the party actually in
possession thereof is a delict or wrong, or a cause of action that gives rise to two (2)
remedies, namely, the recovery of possession and recovery of damages arising from
the loss of possession, but only to one action. For obvious reasons, both remedies
cannot be the subject of two (2) separate and independent actions, one for recovery
of posssession only, and the other, for the recovery of damages. That would
inevitably lead to what is termed in law as splitting up a cause of action. 16 In David v.
de la Cruz 17 we observed —
Herein tenants have but one cause of action against their landlord, their illegal
ejectment or removal from their landholdings, which cause of action however
entitles them to two (2) claims or remedies — for reinstatement of damages. As both
claims arise from the same cause of action, they should be alleged in a single
complaint.
A claim cannot be divided in such a way that a part of the amount of damages may
be recovered in one case and the rest, in another. 18 In Bacharach v. Icarangal 19 we
explained that the rule was aimed at preventing repeated litigations betweent the
same parties in regard to the same subject of the controversy and to protect the
defendant from unnecessary vexation. Nemo debet bis vexari pro una et eadem
causa.
What then is the effect of the dismissal of the other action? Since the rule is that all
such rights should be alleged in a single complaint, it goes without saying that those
not therein included cannot be the subject of subsequent complaints for they are
barred forever. 20 If a suit is brought for a part of a claim, a judgment obtained in that
action precludes the plaintiff from bringing a second action for the residue of the
claim, notwithstanding that the second form of action is not identical with the first or
different grounds for relief are set for the second suit. This principle not only
embraces what was actually determined, but also extends to every matter which the
parties might have litigated in the case. 21 This is why the legal basis upon which
private respondent anchored its second claim for damages, i.e., Art. 1659 in relation
to Art. 1654 of the Civil Code, 22 not otherwise raised and cited by private
respondent in the forcible entry case, cannot be used as justification for the second
96
suit for damages. We note, not without some degree of displeasure, that by filing a
second suit for damages, private respondent was not only able to press a claim for
moral and exemplary damages which by its failure to allege the same in its suit
before the MeTC foreclosed its right to sue on it, but it was also able to obtain from
the RTC, by way of another temporary restraining order, a second reprieve from an
impending public auction sale of its movables which could not anymore secure from
the MeTC before which the matter of the issuance of a preliminary writ of injunction
was already closed.
The foregoing discussions provide sufficient basis to petitioner's charge that private
respondent and its counsel in the trial courts committed forum shopping. In
Crisostomo v. Securities and Exchange Commission 23 we ruled —
There is forum-shopping whenever, as a result of an adverse opinion in one forum,
party seeks a favorable opinion (other than by appeal or certiorari) in another. The
principle applies . . . with respect to suits filed in the courts . . . in connection with
litigations commenced in the court . . . in anticipation of an unfavorable . . . ruling
and a favorable case where the court in which the second suit was brought, has no
jurisdiction.
City. By its admission of a pending forcible entry case, it is obvious that private
respondent was indulging in forum shopping. While private respondent conveniently
failed to inform the RTC that it had likewise sought damages in the MTC on the basis
of the same forcible entry, the fact remains that it precisely did so, which stratagem
was being duplicated in the second case. This is a compelling reason to dismiss the
second case.
WHEREFORE, the Petition is GRANTED. The questioned Decision of the Court of
Appeals dated 27 September 1995 and the Order of the Regional Trial Court of
Quezon City dated 24 September 1993 are REVERSED and SET ASIDE. The Regional
Trial Court of Quezon City is directed to dismiss Civil Case No. Q-93-16409, "Westin
Seafood Market, Inc. v. Progressive Development Corporation, et al.," and the
Metropolitan Trial Court of Quezon City to proceed with the proper disposition of
Civil Case No. 6589, "Westin Seafood Market, Inc. v. Progressive Development
Corporation, et al.," with dispacth considering the summary nature of the case.
Treble costs against private respondent.1âwphi1.nêt
SO ORDERED.

This Court likewise elucidated in New Pangasinan Review, Inc. v. National Labor
Relations Commission 24 that there is forum-shopping when the actions involve the
same transactions, the same essential facts and circumstances. The reason behind
the proscription of forum shopping is obvious. This unnecessarily burdens our courts
with heavy caseloads, unduly taxes the manpower and financial resources of the
judiciary and trifles with and mocks our judicial processes, thereby adversely
affecting the efficient administration of justice. This condemnable conduct has
prompted the Court to issue circulars 25 ordering among others that a violation
thereof shall be cause for the dismissal of the case or cases without prejudice to the
taking of appropriate action against the counsel or party concerned.

The records ineluctably show that the complaint lodged, by private respondent with
the Regional Trial Court of Quezon City contained no certification of non-forum
shopping. When petitioner filed a motion to dismiss the case raising among others
the ground of forum shopping it pointed out the absence of the required
certification. The amended complaint, as well as the second and third amended
complaints, attempted to rectify the error by invariably stating that there was no
other action pending between the parties involving the same causes of action
although there was actually a forcible entry case pending before the MTC of Quezon
97
[G.R. No. 117051. January 22, 1996]
FRANCEL REALTY CORPORATION, petitioner, vs. COURT OF APPEALS and FRANCISCO T.
SYCIP, respondents.
DECISION
MENDOZA, J.:
Petitioner Francel Realty Corporation filed a complaint for unlawful detainer against
private respondent Francisco T. Sycip. The case was filed in the Municipal Trial Court
(MTC) of Bacoor, Cavite.
In its complaint, petitioner alleged that it had executed a Contract to Sell to private
respondent Lot 16, Building No. 14 of the Francel Townhomes, at 22 Real Street,
Maliksi, Bacoor, Cavite, for P451,000.00. The Contract to Sell provides inter alia that
in case of default in the payment of two or more installments, the whole obligation
will become due and demandable and the seller will then be entitled to rescind the
contract and take possession of the property; the buyer will vacate the premises
without the necessity of any court action and the downpayment will be treated as
earnest money or as rental for the use of the premises. Petitioner alleged that
private respondent failed to pay the monthly amortization of P9,303.00 since
October 30, 1990 despite demands to update his payments and to vacate the
premises, the latest of which was the demand made in the letter dated September
26, 1992, and that because of private respondents unjust refusal to vacate,
petitioner was constrained to engage the services of counsel. Petitioner prayed that
private respondent be ordered to vacate the premises and pay a monthly rental of
P9,303.00 beginning October 30, 1990 until he shall have vacated the premises, and
P25,000.00 as attorneys fees plus appearance fee of P 1,000.00 per hearing and
expenses of litigation.
On November 9, 1992, private respondent moved to dismiss the complaint but his
motion was denied by the MTC. On January 20, 1993 he filed his answer, [1] in which
he alleged that he had stopped paying the monthly amortizations because the
townhouse unit sold to him by petitioner was of defective construction. He alleged
that he had in fact filed a complaint for unsound real estate business practice in the
Housing and Land Use Regulatory Board (HLURB Case No. REM-07-9004-80) against
petitioner. Private respondent prayed that petitioner be ordered to pay P500,000.00
as moral damages, P500,000.00 as exemplary damages, P75,000.00 as attorneys fees
and that he be given all other remedies just and equitable.
In its resolution dated February 24, 1993, the MTC ruled that the answer was filed
out of time on the ground that it was filed more than ten days after the service of
summons.[2] On March 17, 1993, however, it dismissed the complaint for lack of
jurisdiction. The MTC held that the case was cognizable by the HLURB. But it also
ordered petitioner to pay private respondent P10,000.00 as moral damages,
P10,000.00 as exemplary damages, P3,000.00 as attorneys fees, and to pay costs.
On appeal the Regional Trial Court affirmed the decision of the MTC. It held that the
case was exclusively cognizable by the HLURB which had jurisdiction not only over
complaints of buyers against subdivision developers but also over actions filed by
developers for the unpaid price of the lots or units.
Petitioner filed a petition for review in the Court of Appeals, alleging that:
(a) The amounts of damages prayed for by the private respondent in his Answer are
enormous and way beyond the jurisdiction of the inferior court; and
(b) Since the inferior court and the respondent court ruled that it has no jurisdiction
over this case, then it has no reason, much more jurisdiction to award damages in
excess of the P20,000.00 jurisdiction of the inferior Court.[3]
The appellate court dismissed the petition, holding that the MTC had jurisdiction
over cases of forcible entry and unlawful detainer, regardless of the amount of
damages on unpaid rentals sought to be recovered in view of 1A(1) of the Revised
Rule on Summary Procedure.[4]
Petitioner moved for reconsideration. It contended that since the MTC had ruled
that it had no jurisdiction over this case, then it had no jurisdiction either to grant
the counterclaim for damages in the total sum of P23,000.00. Its motion was,
however, denied for lack of any cogent reason to reverse the appellate courts
resolution of June 15, 1994.[5]
Hence this petition for review on certiorari.
It is important to first determine whether the MTC has jurisdiction over petitioners
complaint. For if it has no jurisdiction, then the award of damages made by it in its
decision is indeed without any basis. It is only if the MTC has jurisdiction of the
98
subject matter of the action that it is necessary to determine the correctness of the
award of damages, including attorneys fees.
Petitioners complaint is for unlawful detainer. While generally speaking such action
falls within the original and exclusive jurisdiction of the MTC, the determination of
the ground for ejectment requires a consideration of the rights of a buyer on
installment basis of real property. Indeed private respondent claims that he has a
right under P.D. No. 957, 23 to stop paying monthly amortizations after giving due
notice to the owner or developer of his decision to do so because of petitioners
alleged failure to develop the subdivision or condominium project according to the
approved plans and within the time for complying with the same. The case thus
involves a determination of the rights and obligations of parties in a sale of real
estate under P.D. No. 957. Private respondent has in fact filed a complaint against
petitioner for unsound real estate business practice with the HLURB.
amortizations for the sale of the subdivision lot is necessarily tied up to the
complaint against the plaintiff and it affects the rights and correlative duties of the
buyer of a subdivision lot as regulated by NHA pursuant to P.D. 957 as amended. It
must accordingly fall within the exclusive original jurisdiction of the said Board, and
We find that the motion to dismiss was properly granted on the ground that the
regular court has no jurisdiction to take cognizance of the complaint.
Accordingly, we hold that the MTC correctly held itself to be without jurisdiction over
petitioners complaint. But it was error for the MTC to grant private respondents
counterclaim for damages for expenses incurred and inconveniences allegedly
suffered by him as a result of the filing of the ejectment case.[7]
Pursuant to Rule 6, 8 a party may file a counterclaim only if the court has jurisdiction
to entertain the claim. Otherwise the counterclaim cannot be filed.[8]

This is, therefore, not a simple case for unlawful detainer arising from the failure of Even assuming that the MTC had jurisdiction, however the award of damages to
the lessee to pay the rents, comply with the conditions of a lease agreement or private respondent must be disallowed for the following reasons:
vacate the premises after the expiration of the lease. Since the determinative
(1) The MTC decision itself stated that the answer with its counterclaim was filed out
question is exclusively cognizable by the HLURB, the question of the right of
of time or more than 10 days from private respondents receipt of summons. In
petitioner must be determined by the agency.
effect, therefore, private respondent did not make any counterclaim.
Petitioners cause of action against private respondent should instead be filed as a
(2) Moreover, a reading of the MTC decision showed no justification for the award of
counterclaim in HLURB Case No. REM-07-9004-80 in accordance with Rule 6, 6 of the
moral and exemplary damages and attorneys fees. As held in Buan v.
Rules of Court which is of suppletory application to the 1987 HLURB Rules of
Camaganacan,[9] an award of attorneys fees without justification is a conclusion
Procedure per 3 of the same. In the case of Estate Developers and Investors
without a premise, its basis being improperly left to speculation and conjecture. It
Corporation v. Antonio Sarte and Erlinda Sarte[6] the developer filed a complaint to
should accordingly be stricken out. With respect to the award of moral and
collect the balance of the price of a lot bought on installment basis, but its complaint
exemplary damages, the record is bereft of any proof that petitioner acted
was dismissed by the Regional Trial Court for lack of jurisdiction. It appealed the
maliciously or in bad faith in filing the present action which would warrant such an
order to this Court. In dismissing the appeal, we held:
award.[10]
The action here is not a simple action to collect on a promissory note; it is a
WHEREFORE, the decision of the Court of Appeals is REVERSED and the complaint
complaint to collect amortization payments arising from or in connection with a sale
against private respondent is DISMISSED. The private respondents counterclaim is
of a subdivision lot under PD. Nos. 957 and 1344, and accordingly falls within the
likewise DISMISSED.
exclusive original jurisdiction of the HLURB to regulate the real estate trade and
industry, and to hear and decide cases of unsound real estate business practices. SO ORDERED.
Although the case involving Antonio Sarte is still pending resolution before the
HLURB Arbiter, and there is as yet no order from the HLURB authorizing suspension
of payments on account of the failure of plaintiff developer to make good its
warranties, there is no question to Our mind that the matter of collecting
99