LEE BUN TING v.

ALIGAEN
Motion to Dismiss under Rule 16 | G.R. No. L-30523 | Antonio, J.

DOCTRINE (for topic): ‘Law of the case' has been defined as the opinion delivered on a former
appeal. More specifically, it means that whatever is once irrevocably established as the controlling
legal rule of decision between the same parties in the same case continues to be the law of the case,
whether correct on general principles or not, so long as the facts on which such decision was
predicated continue to be the facts of the case before the court.

The determination of the questions of fact and law by the SC in 1956 has become the law of the case,
and cannot be disputed or relitigated by a reopening of the same questions in a subsequent litigation
between the same parties and their privies over the same subject matter.

FACTS OF THE CASE:

Cause of Action Annulment of the sale and the recovery of the subject parcel of land

Nature Petition for certiorari to annul the Orders of respondent court CFI

Parties Petitioners: Lee Bun Ting and Ang Chia

Respondents: Hon. Aligaen, Judge of CFI Capiz; Amosin, court
appointed receiver, and the Dinglasans

FIRST CASE: G.R. L-5996, Dinglasan et al. v. Lee Bun Ting et al.
 June 17, 1956: SC rendered judgment in “Dinglasan et al. v. Lee bun Ting et al.” denying
Dinglasan et al.’s petition to declare the sale of their property void.
 The facts of that case are:
o 1936: Dinglasan et al. sold to Lee Liong, a predecessor in interest of Lee Bun Ting, a
parcel of land in Roxas City.
o Dinglasan et al. wanted to render the sale null and void and recover their propert
because according to them:
 “It was a conditional sale with a right to repurchase.” SC ruled it was an absolute
sale.
 “It was void because it violated Sec. 5, Art. XIII of the 1935 Consti—‘Save in cases
of hereditary succession, no private agricultural land shall be transferred or
assigned except to individuals, corporations, or associations qualified to acquire or
hold lands of the public domain in the Philippines.’”
 However, it was also found that the Dinglasans were equally guilty and
were in pari delicto, because they knew that what they were doing was in
violation of the Constitution.
 Overall, the SC ruled that both parties violated the constitutional prohibition for the purchaser
Lee was an alien and prohibited to acquire residential lot while the vendors Dinglasans, Filipino
citizens, can not also recover the property for having violated the constitutional prohibition,
under the principle of pari delicto. The vendee cannot own the property, neither can the vendor
recover what he sold.

PRESENT CASE
 July 1, 1968: Dinglasan et al. filed a complaint for the recovery of the same parcel of land
subject of the first case, reiterating the same contentions that the sale to Lee Liong
(predecessor-in-interest) was void for violating the Consti. They prayed that they be declared
the rightful and legal owners of the property, and for the petitioner to vacate the property.
 Sept. 23, 1968: Petitioners filed a motion to dismiss on the ground of res judicata, alleging
that the 1956 decision already settled the issues between the parties.
 Dinglasan et al. opposed this motion to dismiss, with the averment that the decision in the
prior case "cannot be pleaded in bar of the instant action because of new or additional
facts or grounds of recovery and because of change of law or jurisprudence."
o The “change in jurisprudence” is the SC decision in PBC v Lui She.
  Petitioner’s reply to the Dinglasans’ opposition alleged that the SC’s decision in the PBC case
was promulgated in 1967 and cannot be applied to the present case because there was
already a final and conclusive determination 12 years earlier.
o Petitioners aver that while a doctrine laid down in previous cases may be overruled,
the previous cases themselves cannot thereby be reopened. The doctrine may be
changed for future cases but it cannot reach back into the past and overturn finally
settled cases.
 CFI Capiz denied the motion to dismiss.
 Petitioners filed a motion for reconsideration, alleding that:
o Their reply to the Dinglasans’ opposition was not considered because the Order of
Denial was issued BEFORE the reply reached the court;
o The PBC case had the effect of annulling and setting aside only the contracts subject
matter thereof "and no other contracts, certainly not contracts outside the issues in
said judgment as that in the instant case";
o Nowhere in the majority opinion nor in the concurring opinion in the PBC decision
does there appear any statement which would have the effect of reopening and
changing previously adjudicated rights of parties and finally-settled cases.
 CFI denied the Motion for Recon.
 Since their motion to dismiss was denied, petitioners were ordered to file their ANSWER to
the complaint of the Dinglasans, wherein they averred:
o The sale was absolute, and not subject to a right to repurchase by the Dinglasans;
o That res judicata applies, on the basis of the SC’s decision in the first case.
o Petitioners prayed the dismissal of the case, with counterclaim for atty’s fees and
other expenses, and that Dinglasans be ordered to pay an equivalent of the value of
the property at the time of the restoration.
 Dinglasans filed their REPLY and ANSWER to the counterclaim.
 During the pendency of the trial, the Dinglasans filed a petition for the appointment of a
receiver, "to receive, collect and hold in trust all income of the property in the form of monthly
rentals of P2,000.00", on the premise that petitioners Lee have no other visible property which
will answer for the payment of said rentals.
o CFI granted the petition and appointed respondent Amosin, the deputy clerk of
court, as receiver. He had instructions to “take immediate possession of the property
in litigation and to preserve, administer and dispose of the same in accordance with
law and order of the court, upon the posting of a bond in the amount of P500.00.”
 Hence, this petition to annul and set aside the Orders of the CFI.

ISSUES with HOLDING:

W/N the questions which were decided in Dinglasan, et al. vs. Lee Bun Ting, et al., (the first
case), could still be relitigated anew, in view of the subsequent decision of this Court in PBC v.
Lui She

HELD: NO. The decision in the first case constitutes a bar to the present case. Therefore, CFI Capiz
should have dismissed the case because it is a mere relitigation of the same issues previously
adjudged with finality in 1956, between the same parties and involving the same subject matter.

RATIO:

 GENERAL RULE: Doctrine of res judicata applies where, between a pending action and one
which has been finally and definitely settled, there is identity of parties, subject matter and cause
of action.
 APPLIED IN THIS CASE: Requisites of res judicata are present.
o The first case was tried and decided by a court of competent jurisdiction, whose decision
was affirmed on appeal by the SC.
o The parties to the two cases are the same.
o The subject matter of the two actions are the same.
o The causes of action and the reliefs prayed for are identical — the annulment of the sale
and the recovery of the subject parcel of land.
 There has been no change in the facts or in the conditions of the parties.
  Neither is the PBC case applicable to the case at bar, considering the rule that subsequent
changes in the doctrine of the SC cannot retroactively be applied to nullify a prior final ruling in
the same proceeding where the prior adjudication was had, whether the case should he civil or
criminal in nature.
o Basically, the determination of the questions of fact and law by the SC in 1956 has
become the law of the case, and cannot be disputed or relitigated by a reopening of the
same questions in a subsequent litigation between the same parties and their privies over
the same subject matter.
o A subsequent reinterpretation of the law may be applied to new cases but certainly not to
an old one finally and conclusively determined.
o As a general rule a decision on a prior appeal of the same case is held to be the law
of the case whether that decision is right or wrong, the remedy of the Party being to
seek a rehearing.
 Ratio for the doctrine of res judicata: Reasons of public policy, judicial orderliness, economy
and judicial time and the interests of litigants, as well as the peace and order of society, all
require that stability be accorded the solemn and final judgments of the courts or tribunals of
competent jurisdiction.

DISPOSITIVE PORTION

WHEREFORE, certiorari is granted, the Orders complained of are hereby annulled and set aside, and
respondent Judge is directed to issue an Order dismissing Civil Case No. V-3064. With costs against
private respondents.

NOTES

 The concept of RES JUDICATA:

o Rule 39, Sec. 49(b) enunciates that concept of res judicata known as 'bar by prior
judgment' while Rule 39 Sec. 49(c) refers to 'Conclusiveness of judgment.'
o There is 'bar by prior judgment' when, between the first case where the judgment was
rendered and the second case which is sought to be barred, there is identity of parties,
subject matter and cause of action. The judgment in the first case constitutes an absolute
bar to the subsequent action. It is final as to the claim or demand in controversy, including
the parties and those in privity with them, not only as to every matter which was offered
and received to sustain or defeat the claim or demand, but as to any other admissible
matter which might have been offered for that purpose and of all matters that could have
been adjudged in that case.
o But where between the first and second cases, there is identity of parties but no identity or
cause of action, the first judgment is conclusive in the second case, only as to those
matters actually and directly controverted and determined and not as to matters merely
involved therein.
o “It need not be stated that the Supreme Court, being the court of last resort, is the final
arbiter of all legal questions properly brought before it and that its decision in any given
case constitutes the law of that particular case. Once its judgment becomes final it is
binding on all inferior courts, and hence beyond their power and authority to alter or
modify.”

 Definition of LAW OF THE CASE:

o ‘Law of the case' has been defined as the opinion delivered on a former appeal. More
specifically, it means that whatever is once irrevocably established as the controlling legal
rule of decision between the same parties in the same case continues to be the law of the
case, whether correct on general principles or not, so long as the facts on which such
decision was predicated continue to be the facts of the case before the court.