SPOUSES RAMON and ESTRELLA RAGUDO vs. FABELLA ESTATE TENANTS ASSOCIATION, INC., G.R. No. 146823, August 9, 2005.
Under consideration is this petition for review on certiorari under Rule 45 of the Rules of Court to nullify and set aside the following issuances of the Court of Appeals in CA-G.R. CV No. 51230, to wit:
1. Decision dated 19 July 2000,[1] affirming with modification an earlier decision of the Regional Trial Court at Pasig City, Branch 155, in an action for recovery of possession thereat commenced by the herein respondent against the petitioners; and
2. Resolution dated 29 January 2001,[2] denying petitioners’ motion for reconsideration.
The facts may be briefly stated, as follows:
Earlier, the tenants of a parcel of land at Mandaluyong City with an area of 6,825 square meters (hereinafter referred to as the Fabella Estate), which formed part of the estate of the late Don Dionisio M. Fabella, organized themselves and formed the Fabella Estate Tenants Association, Inc. (FETA), for the purpose of acquiring said property and distributing it to its members.
Unable to raise the amount sufficient to buy the property from the heirs of Don Dionisio M. Fabella, FETA applied for a loan from the National Home Mortgage Finance Corporation (NHMFC) under the latter’s Community Mortgage Program.
However, as a pre-condition for the loan, and in order that specific portions of the property could be allotted to each tenant who will have to pay the corresponding price therefor, NHMFC required all tenants to become members of FETA.
Accordingly, all the tenants occupying portions of the Fabella Estate were asked to join FETA. While the rest did, the spouses Ramon Ragudo and Estrella Ragudo who were occupying the lot subject matter of this controversy, consisting of about 105 square meters of the Fabella Estate, refused to join the Association. Consequently, the portion occupied by them was awarded to Mrs. Miriam De Guzman, a qualified FETA member.
Later, and with the help of the city government of Mandaluyong, FETA became the registered owner of the entire Fabella Estate, as evidenced by Transfer Certificate of Title No. 2902 issued in its name by the Register of Deeds of Mandaluyong in 1989.
To effect the ejectment of the spouses Ragudo from the portion in question which they continued to occupy despite the earlier award thereof to Mrs. Miriam de Guzman, FETA filed against them a complaint for unlawful detainer before the Metropolitan Trial Court (MeTC) of Mandaluyong City.
In a decision dated 6 August 1990, the MeTC dismissed the unlawful detainer case on the ground that it was an improper remedy because the Ragudos had been occupying the subject portion for more than one (1) year prior to the filing of the complaint, hence the proper action should have been one for recovery of possession before the proper regional trial court. FETA appealed the dismissal to the Regional Trial Court at Pasig City, which affirmed the same.
FETA then filed with the RTC-Pasig a complaint for recovery of possession against the Ragudos. In their Answer, the spouses interposed the defense that they have already acquired ownership of the disputed portion since they have been in occupation thereof in the concept of an owner for more than forty (40) years. They further argued that FETA’s title over the entire Fabella Estate is fake because as appearing on TCT No. 2902, it was originally registered as OCT No. 13, a title which has been previously adjudged null and void by RTC-Pasig in a much earlier case involving different parties. Finally, they insist that FETA’s right to recover has been barred by laches in view of their more than 40-year occupancy of the portion in question.
Eventually, in a decision dated 29 July 1994,[3] the trial court rendered judgment in FETA’s favor, thus:
WHEREFORE, premises considered, judgment is hereby rendered:
1) ordering [spouses Ragudo] to vacate the premises in question and to turn over possession thereof to [FETA];
2) to pay [FETA] rent in the amount of P500.00 for the month of November 1981 and every month thereafter until they vacate the premises;
3) to pay [FETA] attorney’s fees in the amount of P20,000.00;
4) to pay [FETA] the amount of P50,000.00 as exemplary damages; and
5) to pay the costs of suit.
SO ORDERED.
Therefrom, the spouses Ragudo went on appeal to the Court of Appeals, whereat their appellate recourse was docketed as CA-G.R. CV No. 51230.
Meanwhile, pending resolution by the appellate court of the Ragudos’ appeal, FETA filed with the trial court a motion for the issuance of a writ of execution pending appeal, to which the Ragudos interposed an Opposition, followed by FETA’s Reply to Opposition. Then, on 11 October 1994, the Ragudos filed with the trial court a Rejoinder to Reply With Counter-Motion to Admit Attached Documentary Evidence Relevant to the Pending Incident.[4] Attached thereto and sought to be admitted therein were the following documents and photographs, to wit:
1. Letter dated 21 November 1989[5] of the spouses Ragudo’s son, Engr. Aurelio Ragudo, addressed to FETA, stating therein that the Ragudos were willing to become FETA members;
2. Joint Affidavit, dated 07 October 1994, of three (3) residents of the Fabella Estate;[6]
3. Photos of three (3) alleged houses of Miriam de Guzman located at the Fabella Estate;[7]
4. Photos of two (2) alleged houses of the sons of Miriam de Guzman located at the Fabella Estate;[8]
5. Photo of a lot allegedly awarded by FETA to its president, Amparo Nobleza, located at the Fabella Estate;[9] and
6. Photo of a three (3)-storey house of Nobleza’s relative named Architect Fernandez located at the Fabella Estate.[10]
In an order dated 25 November 1994, the trial court admitted in evidence the attachments to the Ragudos' aforementioned Rejoinder With Counter-Motion, etc., and ultimately denied FETA’s motion for execution pending appeal.
Later, in CA-G.R. CV No. 51230, the Ragudos filed with the appellate court a Motion To Admit Certain Documentary Evidence by Way of Partial New Trial, In the Interest of Justice,[11] thereunder seeking the admission in evidence of the very documents earlier admitted by the trial court in connection with the then pending incident of execution pending appeal, and praying that said documents be made part of the records and considered in the resolution of their appeal in CA-G.R. CV No. 51230.
This time, however, the Ragudos were not as lucky. For, in a Resolution dated 19 May 1997,[12] the appellate court denied their aforesaid motion and ordered expunged from the records of the appealed case the documents they sought admission of, on the ground that they could not be considered as newly discovered evidence under Rule 37 of the Rules of Court. Dispositively, the Resolution reads:
WHEREFORE, the instant motion to admit certain documentary evidence by way of partial new trial is DENIED for lack of merit.
ACCORDINGLY, the Joint Affidavit dated October 7, 1994 of Honesto Garcia III and Miguela L. Balbino and the latter of Aurelio Raguo to Atty. Cesar G. Untalan dated November 21, 1989 are ordered EXPUNGED from the records of this case.
SO ORDERED.
The Ragudos moved for a reconsideration, invoking “liberality in the exercise of judicial discretion” and the “interest of equity and substantial justice”. Unmoved, the appellate court denied their motion in its subsequent Resolution of 24 September 1997.[13]
Eventually, in the herein assailed decision dated 19 July 2000, the Court of Appeals dismissed the Ragudos’ appeal in CA-G.R. CV No. 51230 and affirmed with modification the RTC decision in the main case, thus:
WHEREFORE, premises considered, the appealed decision is hereby AFFIRMED, except for the second clause of the dispositive portion which should be MODIFIED, as follows:
“2) to pay [FETA] rent in the amount of P500.00 for the month of November, 1989 and every month thereafter until they vacate the premises.”
SO ORDERED.
With their motion for reconsideration having been denied by the appellate court in its equally challenged Resolution of 29 January 2001, the Ragudos are now with us via the instant recourse, commending for our resolution the following issues:
1. WHETHER OR NOT THE COURT OF APPEALS ERRED IN NOT ADMITTING IN EVIDENCE THE DOCUMENTS SOUGHT TO BE INTRODUCED BY RAGUDO AT THE APPELLATE LEVEL ON THE GROUND OF “LIBERALITY OF PROCEDURAL RULES”, “EQUITY AND SUBSTANTIAL JUSTICE”, THE “MISTAKE AND EXCUSABLE
NEGLIGENCE” ON THE PART OF THEIR FORMER COUNSEL, AND THE “SOCIAL JUSTICE AND PARENS PATRIAE CLAUSE” OF THE 1987 CONSTITUTION.
2. WHETHER OR NOT “ACQUISITIVE PRESCRIPTION AND EQUITABLE LACHES” HAD SET IN TO WARRANT THE CONTINUED POSSESSION OF THE SUBJECT LOT BY RAGUDO AND WHETHER THE SAME PRINCIPLES HAD CREATED A “VESTED RIGHT” IN FAVOR OF RAGUDO TO CONTINUE TO POSSESS AND OWN THE SUBJECT LOT.[14]
Informed of Mr. Ramon Ragudo’s death on 26 March 2001, the Court, in a resolution dated 14 January 2002,[15] allowed his substitution by his other heirs.
The recourse must fall.
Relative to the first issue, it is petitioners’ submission that the appellate court committed an error when it refused admission as evidence in the main case the documents earlier admitted by the trial court in connection with FETA’s motion for execution pending appeal. Appealing to this Court’s sense of judicial discretion in the interest of equity and substantial justice, petitioners explain that the documents in question were not presented and offered in evidence during the trial of the main case before the RTC due to the honest mistake and excusable negligence of their former counsel, Atty. Celso A. Tabobo, Jr.
We are not persuaded.
In this jurisdiction, well-entrenched is the rule that the mistake and negligence of counsel to introduce, during the trial of a case, certain pieces of evidence bind his client.[16] For sure, in Aguila vs. Court of First Instance of Batangas,[17] we even ruled that the omitted evidence by reason of counsel’s mistake or negligence, cannot be invoked as a ground for new trial:
On the effects of counsel’s acts upon his client, this Court has categorically declared:
It has been repeatedly enunciated that ‘a client is bound by the action of his counsel in the conduct of a case and cannot be heard to complain that the result might have been different had he proceeded differently. A client is bound by the mistakes of his lawyer. If such grounds were to be admitted and reasons for reopening cases, there would never be an end to a suit so long as new counsel could be employed who could allege and show that prior counsel had not been sufficiently diligent or experienced or learned. x x x Mistakes of attorneys as to the competency of a witness, the sufficiency, relevancy or irrelevancy of certain evidence, the proper defense, or the burden of proof, x x x failure to introduce certain evidence, to summon witnesses and to argue the case are not proper grounds for a new trial, unless the incompetency of counsel is so great that his client is prejudiced and prevented from properly presenting his case.’ (Vol. 2, Moran, Comments on the Rules of Court, pp. 218, 219-220, citing Rivero v. Santos, et al., 98 Phil. 500, 503-504; Isaac v. Mendoza, 89 Phil. 279; Montes v. Court, 48 Phil. 64; People v. Manzanilla, 43 Phil. 167; U.S. v. Umali, 15 Phil. 33; see also People v. Ner, 28 SCRA 1151, 1164). In the 1988
case of Palanca v. American Food, etc. (24 SCRA 819, 828), this principle was reiterated. (Tesoro v. Court of Appeals, 54 SCRA 296, 304). [Citations in the original; Emphasis supplied].
This is, as it should be, because a counsel has the implied authority to do all acts which are necessary or, at least, incidental to the prosecution and management of the suit in behalf of his client.[18] And, any act performed by counsel within the scope of his general and implied authority is, in the eyes of the law, regarded as the act of the client himself and consequently, the mistake or negligence of the client’s counsel may result in the rendition of an unfavorable judgment against him.[19]
A contrary rule would be inimical to the greater interest of dispensing justice. For, all that a losing party will do is to invoke the mistake or negligence of his counsel as a ground for reversing or setting aside a judgment adverse to him, thereby putting no end to litigation. Again, to quote from our decision in Aguila:
Now petitioner wants us to nullify all of the antecedent proceedings and recognize his earlier claims to the disputed property on the justification that his counsel was grossly inept. Such a reason is hardly plausible as the petitioner’s new counsel should know. Otherwise, all a defeated party would have to do to salvage his case is claim neglect or mistake on the part of his counsel as a ground for reversing the adverse judgment. There would be no end to litigation if this were allowed as every shortcoming of counsel could be the subject of challenge by his client through another counsel who, if he is also found wanting, would likewise be disowned by the same client through another counsel, and so on ad infinitum. This would render court proceedings indefinite, tentative and subject to reopening at any time by the mere subterfuge of replacing counsel. (Emphasis supplied).
Admittedly, the rule thus stated admits of exceptions. Thus, in cases where the counsel’s mistake is so great and serious that the client is prejudiced and denied his day in court[20] or when he is guilty of gross negligence resulting in the client’s deprivation of his property without due process of law,[21] the client is not bound by his counsel’s mistakes and the case may even be reopened in order to give the client another chance to present his case.
Unfortunately, however, petitioners’ case does not fall under any of the exceptions but rather squarely within the ambit of the rule.
As it is, petitioners were given full opportunity during the trial of the main case to adduce any and all relevant evidence to advance their cause. In no sense, therefore, may it be argued that they were denied due process of law. As we said in Antonio vs. Court of Appeals,[22] a client cannot be said to have been deprived of his day in court and there is no denial of due process as long as he has been given an opportunity to be heard, which, we emphasize, was done in the instant case.
Petitioners further argue that the documents which their former counsel failed to adduce in evidence during trial of the main case must be allowed to stay in the records thereof and duly considered in the resolution of their appeal because they were duly admitted in the trial court during the hearing on the incidental motion for execution pending appeal.
Again, we are not persuaded.
With the reality that those documents were never presented and formally offered during the trial of the main case, their belated admission for purposes of having them duly considered in the resolution of CA-G.R. CV No. 51230 would certainly collide with Section 34, Rule 132, of the Rules of Court, which reads:
SECTION 34. Offer of Evidence. – The court shall consider no evidence which has not been formally offered. The purpose for which the evidence is offered must be specified. (Emphasis supplied).
To stress, it was only during the hearing of the motion for execution pending appeal that said documents were presented and offered in evidence. Sure, the trial court admitted them, but the admission was only for the purpose for which they were offered, that is, by way of opposition to FETA’s motion for execution pending appeal. It is basic in the law of evidence that the court shall consider evidence solely for the purpose for which it was offered.[23]
While the said documents may have the right to stay in the records of the case for purposes of the incidental issue of execution pending appeal, they do not have that same right insofar as far as the main case is concerned, and ought not be considered in the resolution thereof.
Petitioners next contend that acquisitive prescription and equitable laches had set in, thereby vesting them with a right to a continued possession of the subject lot.
The contention holds no water.
It is not disputed that at the core of this controversy is a parcel of land registered under the Torrens system. In a long line of cases,[24] we have consistently ruled that lands covered by a title cannot be acquired by prescription or adverse possession. So it is that in Natalia Realty Corporation vs. Vallez, et al.,[25] we held that a claim of acquisitive prescription is baseless when the land involved is a registered land because of Article 1126 of the Civil Code[26] in relation to Act 496 (now, Section 47 of Presidential Decree No. 1529[27]):
Appellants’ claim of acquisitive prescription is likewise baseless. Under Article 1126 of the Civil Code, prescription of ownership of lands registered under the Land Registration Act shall be governed by special laws. Correlatively, Act No. 496 provides that no title to registered land in derogation of that of the registered owner shall be acquired by adverse possession. Consequently, proof of possession by the defendants is both immaterial and inconsequential. (Emphasis supplied).
Petitioners would take exception from the above settled rule by arguing that FETA as well as its predecessor in interest, Don Dionisio M. Fabella, are guilty of laches and should, therefore, be already precluded from asserting their right as against them, invoking, in this regard, the rulings of this Court[28] to the effect that while a registered land may not be acquired by prescription, yet, by virtue of the registered owner’s inaction and neglect, his right to recover the possession thereof may have been converted into a stale demand.
While, at a blush, there is apparent merit in petitioners’ posture, a closer look at our jurisprudence negates their submission.
To start with, the lower court found that petitioners’ possession of the subject lot was merely at the tolerance of its former lawful owner. In this connection, Bishop vs. Court of Appeals[29] teaches that if the claimant’s possession of the land is
merely tolerated by its lawful owner, the latter’s right to recover possession is never barred by laches:
As registered owners of the lots in question, the private respondents have a right to eject any person illegally occupying their property. This right is imprescriptible. Even if it be supposed that they were aware of the petitioner’s occupation of the property, and regardless of the length of that possession, the lawful owners have a right to demand the return of their property at any time as long as the possession was unauthorized or merely tolerated, if at all. This right is never barred by laches. (Emphasis supplied).
To the same effect is our pronouncement in Urquiaga vs. Court of Appeals,[30] to wit:
We find no reversible error committed by respondent Court of Appeals. We sustain private respondents’ ownership of Lot No. 6532-B. As between the verbal claim of ownership by petitioners through possession for a long period of time, which was found by the court a quo to be inherently weak, and the validly documented claim of ownership of respondents, the latter must naturally prevail. (Emphasis supplied).
WHEREFORE, the instant petition is DENIED and the assailed decision and resolution of the Court of Appeals AFFIRMED.
Costs against petitioners.
SO ORDERED.
[16] E.g. Boyer-Roxas vs. Court of Appeals, 211 SCRA 470 [1992]; Alabanzas vs. Intermediate Appellate Court, 204 SCRa 304, [1991]; and Aguilar vs. Court of Appeals, 250 SCRA 371 [1995].
[17] 160 SCRA 352 [1988].
[18] Mobil Oil Philippines, Inc. vs. Court of First Instance of Rizal, 208 SCRA 523 [1992].
[19] Salonga vs. Court of Appeals, 336 Phil. 514 [1997].
[20] Boyer-Roxas vs. Court of Appeals, supra.
[21] Aguilar vs. Court of Appeals, supra.
[22] 167 SCRA 127 [1988].
[23] Vol. II, Regalado, Florenz D., Remedial Law Compendium, p. 677 (1995), citing People vs. Abalos, [CA], 58 O.G. 5446.
[24] E.g., Tuason vs. Bolaños, 95 Phil. 106 [1954]; Vda. de Recinto vs. Inciong, 77 SCRA 196 [1977]; and J.M. Tuason & Co., Inc. vs. Court of Appeals, 93 SCRA 146 [1979].
[25] 173 SCRA 534 [1989].
[26] ARTICLE 1126. Against a title recorded in the Registry of Property, ordinary prescription of ownership or real rights shall not take place to the prejudice of a third person, except in virtue of another title also recorded; and the time shall begin to run from the recording of the latter.
As to land registered under the Land Registration Act, the provisions of that special law shall govern. (Emphasis supplied)
[27] SECTION 47. Registered land not subject to prescription. – No title to registered land in derogation of the title of the registered owner shall be acquired by prescription or adverse possession.
[28] E.g., Mejia de Lucas vs. Gamponia, 100 Phil. 277 [1956]; Miguel vs. Catalino, 135 Phil. 229 [1968]; etc.
[29] 208 SCRA 636 [1992].
[30] 361 Phil. 660 [1999].
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I. BACKGROUND STATEMENT
On Feb. 13, 2001 the petitioners filed an “urgent ex parte motion for extension of time to file petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure” and simultaneously with the filing of the motion, the petitioners paid to this Honorable Court the necessary docket and filing fees and deposit for costs for the intended petition, pursuant to Rule 45 (see Official Receipt Nos. 13442750, 14280933, 13804545, and 0239615, all dated Feb. 13, 2001).
The requested 30-day extension would end on March 19, 2001.
On March 7, 2001 the Honorable Court issued a Resolution, a copy of which was received by undersigned counsel for the petitioners on March 16, 2001, granting the motion, without further extension.
Hence, this petition, which will be filed on March 19, 2001, the deadline for the petition.
II. NATURE OF THE PETITION
AND STATEMENT OF MATERIAL DATES.
This is a petition for review on certiorari under Rule 45, raising only purely legal questions, in relation to the:
(a) DECISION of the Court of Appeals, dated July 19, 2000, a copy of which was received by the petitioners, thru their counsel, on July 26, 2000, and
(b) RESOLUTION of the Court of Appeals, dated Jan. 29, 2001, a copy of which was received by the petitioners, thru counsel, on Feb. 5, 2001.
On Feb. 13, 2001, as earlier stated, the petitioners filed a motion for a 30-day extension to file their PETITION for review on certiorari with this Honorable Court under Rule 45, which motion this Honorable Court has granted in its Resolution, dated March 7, 2001, a copy of which was received by the petitioners, thru counsel, on March 16, 2001.
Hence, this petition, which will be filed on March 19, 2001, the extended deadline therefor.
Attached hereto are certified true copies of:
(a) the DECISION of the Court of Appeals, marked as ANNEX “A” hereof, and
(b) the RESOLUTION of the Court of Appeals, dated Jan. 29, 2001, denying the motion for reconsideration of the petitioners, marked as ANNEX “B” hereof.
III. STATEMENT OF THE MATTERS INVOLVED
A. The Case at the Level of the Regional Trial Court (RTC)
In 1990 the respondent FABELLA ESTATE TENANTS ASSOCIATION, INC. (“FABELLA”, for short) filed a complaint against the herein petitioners Spouses RAMON and ESTRELLA RAGUDO (“RAGUDO“, for short), for recovery of possession with damages,”alleging that it was the owner of a parcel of land, with an area of 6, 825 sq. m., covered by TCT No. 2902 issued by the Registry of Deeds of Mandaluyong in 1989; that FABELLA acquired the property under the government’s Community Mortgage Program (CMP); that RAGUDO was the occupant of a house built on 105-sq. m. lot in the property; that the occupation of RAGUDO was with the knowledge of the previous owners of the property; that when FABELLA acquired the property, it offered the lot being occupied by RAGUDO to the latter for purchase by RAGUDO under the CMP project but RAGUDO refused the offer to join the project and be a member of FABELLA; that FABELLA thus awarded the unit to another awardees/members; and that FABELLA requested RAGUDO to vacate the lot but the latter refused.
Attached hereto is a photocopy of the Complaint (Annex “C”).
RAGUDO filed their answer, thru their former counsel (Atty. J. E. L. Navarro), alleging, inter alia, that RAGUDO have been in possession of their lot for more than 42 years since 1947 in the concept of owners; and that the title of FABELLA was fake and null and void on its face.
Attached hereto is a photocopy of the Answer (Annex “D”).
RAGUDO offered the following exhibits which the trial court admitted: 1) Decision of MTC Branch 59 Mandaluyong, dated Aug. 6, 1990, dismissing the ejectment suit filed by FABELLA against RAGUDO for lack of jurisdiction; 2) Decision of RTC 155 Pasig, dated Oct. 6, 1989, in Civil Case No. 58132, “Ong v. Adolfo et. al.”, an analogous (appealed) case, dismissing an ejectment suit filed with the Metropolitan Trial Court, for lack of jurisdiction; 3) Decision of CFI Branch 2 Rizal, dated May 26, 1971, in Civil Case No. 8320, “Vda. de Heberer v. Martinez”, an analogous case; 4) Order of CFI Branch 2 Rizal, dated June 21, 1971, an analogous case, showing that the court had annulled TCT No. 14979 in the name of DIONISIO FABELLA (Decree No. 1425, Rec. No. 917), the predecessor of FABELLA; 5) Memorandum filed in Civil Case No. 51493 filed with RTC 160 Pasig, “Navarro v. Bote”, an analogous case; 6) Motion for Reconsideration filed in Civil Case No. 58751, RTC Pasig, an analogous case; 7) Reply dated Feb. 4, 1991, Amended Petition, and Motion for Reconsideration filed in CA GR No. 20907, Court of Appeals (2nd Division), “Navarro v. Hon. Austria”, an analogous case, and in SC Admin. Case No. 2148, “Geeslin et al vs. Navarro”, an analogous case; Additional Records of CA GR SP No. 20907, “Navarro v. Hon. Austria” (motion for resolution...); Decision of RTC Pasig Branch 150, dated Dec. 17, 1988, in “Civil Case No. 51498, “Navarro v. Bote”, an analogous case; Decision in CA GR No. 00295, May 31, 1991, “Vasquez v. Navarro”, an analogous case Decision of the Supreme Court, Aug. 28, 1991, in GR No. 91797, “Widows and Orphans Association Inc. v. CA, et. al.”, showing that OCT NO. 13 in Dec. No. 240 (the predecessor of FABELLA’s TCT No. 2902) had been nullified by the Supreme Court; Application of Building Permits (additional constructions) filed by RAGUDO, March 31, 1960 to prove his possession; a 1961 Tax Declaration on the subject lot in the name of RAGUDO to show their possession and acts of ownership.
Attached is a copy of the offer of exhibits of RAGUDO, dated Nov. 22, 1993 filed by their former counsel, Atty. C.A. Tabobo Jr.,marked as Annex “E” hereof. The trial court issued an order, dated Dec. 14, 1993, admitting the exhibits, a copy of which is attached hereto as Annex “F”hereof.
FABELLA offered exhibits “A” to “H”. The trial court issued an Order, dated Oct. 18, 1993, admitting them, except Exh. “B” (the TCT No. 2902 of FABELLA) and Exh. “H” (not stated in the Fabella offer).
There was thus no documentary evidence of the title of FABELLA. Yet the trial court, in its decision, referred to the said title of FABELLA, TCT No. 2902, as proof of its ownership of the property.
Attached copies of: the Offer of Exhibits filed by FABELLA (Annex “G” hereof); the copy of TCT No. 2902 in the name of FABELLA (Annex “H” hereof); and the Order, dated Oct. 18, 1993, of the trial court denying admission of the Title (Annex “I” hereof).
After trial, the trial court issued a decision, a copy of which is attached hereto as Annex “J” hereof, ordering RAGUDO to vacate the subject lot and to pay the damages stated therein to FABELLA. The findings of facts and law of the trial court may be enumerated as follows:
1. FABELLA is a non-stock, non-profit corporation composed of members who were originally tenants of the subject property with an area of 6,825 sq. m.
2. RAGUDO are among the tenants thereat, occupying an area of 167 sq. m. They did not join FABELLA as members.
3. The original owner of the property was DON DIONISIO FABELLA.
4. FABELLA acquired the property under the Community Mortgage Program (CMP). The local government assisted FABELLA on the project. FABELLA applied for a loan with the National Home Mortgage Finance Corp. (NHMFC).
5. FABELLA awarded the lot occupied by RAGUDO to MIRIAM DE GUZMAN because of the refusal of RAGUDO to be members of FABELLA.
6. FABELLA filed the suit to recover the subject lot so that it could turn it over to the awardee De Guzman.
7. FABELLA filed an ejectment suit with MTC Mandaluyong Branch 59 per Civil Case No. 13063. The MTC dismissed it on the ground that the proper action should be an “accion publiciana” before the RTC Pasig, the possession of RAGUDO being for more than one (1) year as of such filing. FABELLA appealed the decision to RTC Pasig, which dismissed the appeal.
8. In their answer, RAGUDO claimed ownership of the subject lot by virtue of prescription, having possessed it for more than 40 years in the concept of owners. They alleged that the case should be dismissed on the ground of res judicata in relation to the decisions of MTC 59 Mandaluyong and RTC Pasig (dismissing the ejectment suit of FABELLA versus RAGUDO). They alleged that the tile of FABELLA (TCT No. 2902) is fake, considering that on its face it was originally registered as OCT No. 13, per Dec. No. 240 in LRC No. 917, which had been nullified by the RTC Pasig. They also allege that FABELLA could no longer seek recovery against RAGUDO on the ground of laches, the RAGUDO spouses having been in possession of the lot for more than 40 years.
9. Prescription does not lie against titled properties as a general rule.
10. Equitable laches may apply to titled properties (Lacamen v. Laru, 145 SCRA 439), as an exception to the general rule that prescription does not lie against titled properties.
11. In 1989 FABELLA acquired the subject land thru a loan and the contributions of its members. Since the suit against RAGUDO was filed by FABELLA in 1990, the latter could not be guilty of laches.
12. Since RAGUDO refused to become members of FABELLA, the latter had the right to recover the questioned lot from RAGUDO. RAGUDO cannot continue possessing the lot without becoming members of FABELLA and paying to it their dues and contributions.
B. The Appeal to the Court of Appeals (CA)
RAGUDO in due time seasonably appealed to the Court of Appeals thru their current undersigned counsel.
The RAGUDO appeal to the Court of Appeals was docketed as CA GR CV No. 51230.
C. The Motion for Partial New Trial Filed by the Petitioners
Before the Court of Appeals (CA); Denied.
Invoking equity and substantial justice, RAGUDO filed with the appellate court a motion for partial new trial to seek the admission in evidence, inter alia, of the letter, dated Nov. 21, 1989, of the son of RAGUDO, Engr. Aurelio Ragudo, addressed to FABELLA, thru their former counsel, Atty. Cesar Untalan, notifying FABELLA, in behalf of the RAGUDO family, that the RAGUDOs were willing to become members of FABELLA and that as early as Sept. 16, 1989 the RAGUDOs had informed the FABELLA president, Mrs. A. Nobleza, that the RAGUDOs wished to become members of the association.
A copy of the motion is attached hereto as Annex “K” hereof.
The appellate court denied the motion. A copy of its Resolution, dated May 19, 1997, is attached hereto as Annex “L” hereof. In denying the motion, the CA held that the documents sought to be introduced by RAGUDO were not newly discovered evidence under Rule 37 and that they were not formally offered during the trial (Rule 132).
RAGUDO filed a motion for reconsideration thereon (see Annex “M” hereof), arguing that the appellate had been too literal in its interpretation of Rule 37, that it had failed to recognize the value of equity and substantial justice and the liberality rule in trial procedures.
The CA denied the motion for reconsideration in its Resolution, dated Sept. 24, 1997 (see Annex “N” hereof).
D. The Decision of the Court of Appeals
The CA issued a DECISION, dated July 19, 2000, denying the appeal of RAGUDO (Annex “A”, supra).
In the CA, RAGUDO raised the following issues: a) bar by prior judgment; b) bar by laches or estoppel; c) vested possessory rights by virtue of acquisitive prescription; d) lack of legal basis for the award of damages and order to vacate. (CA Decision, p. 4).
The subject CA Decision made the following findings and rulings:
1. The elements of res judicata (bar by prior judgment) are: the judgment was final; the judgment was rendered by a court of competent jurisdiction; the judgment was on the merits; and between the first and second actions, there is identity of parties, subject matter, and cause of action. (Blue Bar Coconut v. NLRC, 208 SCRA 371; Africa c. PCGG, 205 SCRA 39; De la Rosa v. Meralco, 211 SCRA 236; De Ramos v. CA, 213 SCRA 207).
2. The first action (MTC Mandaluyong Branch 59 for ejectment, “Fabella v. Ragudo, Decision dated Aug. 6, 1990 dismissing the ejectment suit against Ragudo, and affirmed by the RTC Branch 155 Pasig, “Fabella v. Ragudo”, dated Oct. 6, 1989) focused solely on the issue of jurisdiction of the MTC and not on the merits of the case because the MTC believed that the proper action should have been “accion publiciana” before the RTC. Thus, the first action was not a bar to the
second action (i.e., “Fabella v. Ragudo”, RTC 155 Pasig, Civil Case No. 60317, subject of the appeal to the CA).
3. Laches has not set in. Although RAGUDO had been in possession of the lot for 44 years, FABELLA acquired the land only in 1989 and it filed the suit for recovery of possession versus RAGUDO in 1990. FABELLA did not sleep on its rights. FABELLA’s predecessors did not sleep on their rights because the tenants recognized the predecessors are the owners of the property, although the predecessors did not physically occupy the land. A landowner has the right to demand the return of his property at anytime as long as the possession is unauthorized or merely tolerated. It is never barred by laches (Bishop vs. CA, 208 SCRA 636).
4. Re: the issue of acquisitive prescription, Art. 1137, Civil Code, applies only to unregistered lands. Sec. 47, PD 1529 states that titled lands cannot be acquired by prescription. (Rivera v. CA, 244 SCRA 218).
5. The CA decision corrected the commencement of the period of the rents that should be paid to FABELLA by RAGUDO, that is, 1989 instead of 1981 as erroneously stated in the RTC decision.
6. FABELLA as the registered owner of the land has the right to possess and use it, the right to choose the persons to whom parts thereof may be transferred, and the right not to be compelled to sell a part thereof to anybody (Ragudo, included).
7. It was the fault of RAGUDO that they did not become members of FABELLA. They refused to be members despite the opportunity given them by FABELLA. FABELLA now has the right to award the lot to another person.
E. The Motion for Reconsideration filed by the Petitioners
Before the Court of Appeals (CA); Denied.
RAGUDO filed a motion for reconsideration on Aug. 9, 2000 (see Annex “O” hereof).
The CA denied the motion for reconsideration of RAGUDO in a Resolution, dated Jan. 29, 2001 (Annex “B”, supra).
Hence, this petition.
IV. REASONS AND ARGUMENTS RELIED UPON
FOR THE ALLOWANCE OF THE PETITION
A. The Purely Legal Issues Involved in this Petition
RAGUDO raises in this petition only two (2) purely legal questions:
1. WHETHER OR NOT THE COURT OF APPEALS ERRED IN NOT ADMITTING IN EVIDENCE THE DOCUMENTS SOUGHT TO BE INTRODUCED BY RAGUDO AT THE APPELLATE LEVEL ON THE GROUND OF “LIBERALITY OF PROCEDURAL RULES”, “EQUITY AND SUBSTANTIAL JUSTICE”, THE “MISTAKE AND EXCUSABLE NEGLIGENCE” ON THE PART OF THEIR FORMER COUNSEL, AND THE “SOCIAL JUSTICE CLAUSE AND PARENS PATRIAE CLAUSE” OF THE 1987 CONSTITUTION.
2. WHETHER OR NOT “ACQUISITIVE PRESCRIPTION AND EQUITABLE LACHES” HAD SET IN TO WARRANT THE CONTINUED POSSESSION OF THE SUBJECT LOT BY RAGUDO AND WHETHER THE SAME PRINCIPLES HAD CREATED A “VESTED RIGHT” IN FAVOR OF RAGUDO TO CONTINUE TO POSSESS AND OWN THE SUBJECT LOT.
B. The Legal Issue of the “Motion for Partial New Trial”
At the RTC level, RAGUDO filed a REJOINDER on Oct. 11, 1994 on the issue of “execution pending appeal” which was being sought by FABELLA. To the rejoinder, RAGUDO attached, by way of a “counter motion to admit documentary evidence on the issue of execution pending appeal”, the following documentary evidence: a) Joint Affidavit, dated Oct. 7, 1994, of R. Macaller, M.L. Balbino, and V. Aragon, all residents of the same Fabella Estate; b) Photos the three (3) houses of awardee Mrs. M. de Guzman at the same Fabella Estate (the awardee who claims the subject Ragudo lot) to show the corruption, favoritism and discrimination of FABELLA ; c) Photos of the two (2) houses of the sons of awardee Mrs. M. De Guzman at the same Fabella Estate, to show the corruption, favoritism and discrimination of FABELLA; d) Photo of the big lot awarded by FABELLA to its president, Mrs. A. Nobleza, which the latter rented out to a businessman, to show the corruption, favoritism and discrimination of FABELLA; e) Photo of a 3-floor house of a relative of the president, Mrs. Nobleza, named Arch. Fernandez, in the same Fabella Estate, despite the fact that the said person was not a resident thereof, to show the corruption, favoritism and discrimination of FABELLA; and f) Sketch of the locations of the said corruption-based houses.
The rejoinder also contained the LETTER, dated Nov. Nov. 21, 1989, of Aurelio Ragudo, in behalf of the RAGUDO family, addressed to the former counsel for FABELLA, Atty. Cesar Untalan, notifying FABELLA that RAGUDO were interested and willing to apply for membership with FABELLA to avail of the housing program thereof. It was received on Nov. 22, 1989 by said counsel.
Attached is a copy of the said REJOINDER, the Joint Affidavit, the Photos, and the Letter of Aurelio Ragudo to FABELLA thru counsel, marked as Annex “P” to “P-42". They all formed part of the case record at the RTC level in connection with the incidental issue of execution pending appeal. They were duly admitted in evidence at the RTC level. As proof of such admission in evidence, attached hereto is a copy of the TSN of the hearing held on Nov. 25, 1994 (Annexes “Q” to “Q-16" hereof). During the said hearing, counsel for FABELLA, inter alia, admitted the existence and faithful reproduction of the Nov. 21, 1989 letter sent by Aurelio Ragudo to FABELLA applying for membership (TSN, Nov. 25, 1994, p. 16).
During the said hearing on Nov. 25, 1994, Aurelio Ragudo testified that aside from applying in 1989 for membership in FABELLA, they were told to save P25,000 to purchase their lot under the housing program, but when they later approached the president of FABELLA, Mrs. Nobleza, they were told that the lot had been awarded to Mrs. M. de Guzman (TSN, Nov. 25, 1994, p. 12). He also testified that his letter of Nov. 21, 1989 was received by Atty. Untalan, ex-counsel for FABELLA but he was told that the lot had been awarded to Mrs. de Guzman. (TSN, Nov. 25, 1994, p. 13). He testified that their former counsel, Atty. Tabobo, did not present the letter in evidence before the trial court (TSN, id., p. 14). The current counsel for FABELLA, Atty. Lacebal, admitted the due execution and faithful reproduction of the letter of Nov. 21, 1989 of Aurelio Ragudo addressed to FABELLA. (TSN, id., p. 16).
The trial court admitted in evidence the exhibits presented RAGUDO during the Nov. 25, 1994 hearing on the incident of execution pending appeal, i.e., the joint affidavit, the photos, the Letter of Nov. 21, 1989 of Aurelio Ragudo, etc. (TSN, id., pp. 16-17).
The trial court denied FABELLA’s motion for execution pending appeal.
The Court of Appeals expunged from the record of the appealed case the above-cited exhibits on the ground that they were not newly discovered evidence under Rule 37 (see Annexes “K” to “N”, supra). The CA did not realize that the said exhibits had the right to stay in the record of the appealed case because they were duly admitted in evidence at the RTC level during the hearing on Nov. 25, 1994 (incident/issue of execution pending appeal). What RAGUDO sought before the CA in their motion for partial new trial was the admission of the same exhibits for purposes of the main case pending appeal because of the honest mistake and excusable negligence of their former counsel, Atty. Tabobo, in not presenting them during the trial, especially the letter of Nov. 21, 1989 of Aurelio Ragudo which would show the intent and desire of the RAGUDO family to apply for membership in FABELLA to avail of the housing program, considering that they had been in possession of the lot for more than 44 years as of that time.
In their motion for partial new trial and to admit the said exhibits for purposes of the main case on appeal, RAGUDO invoked the sense of liberal judicial discretion of the CA in the interest of equity and substantial justice in the light of the mistake and excusable negligence of their former counsel Atty. Tabobo in not presenting them during the RTC trial (Sec. 1, Rule 37). RAGUDO were not seeking their admission by the CA as newly discovered evidence under Rule 37.
RAGUDO cited various cases to show the acceptance in this jurisdiction of the doctrine of liberality of procedures and equity in the interest of substantial justice and natural justice and to prevent a grave miscarriage of justice, considering the fact that the RAGUDOs, who are more than 85 years old now and who are not socio-economically well-off, have been living in the subject lot for more than 44 years as of the time of the appeal to the CA and that it is the situs of their family home up to now. Some of the Supreme Court cases by RAGUDO in this regard were Chua v. CA, 206 SCRA 339; Emata v. IAC, 174 SCRA 464; Chan Kim v. People, 176 SCRA 277; General Insurance v. Union Insurance, 179 SCRA 740; Paulino v. CA, 80 SCRA 257; People v. Cruz, 177 SCRA 451; Smith Bell v. American Presidents Lines, 94 Phil. 579; Olilaz v. Nocon, 81 SCRA 739; Luna v. Arcenas, 34 Phil. 80; Alonzo v. Villamor, 16 Phil. 315; Case and Nanz v. Jugo, 77 Phil. 517; Parales v. de la Cruz, GR 31667, 10th Div., CA, Aug. 31, 1994; Santos v. CA, GR 114726, Feb. 14, 1996; De Guzman v. Sandiganbayan, GR 103276, April 11, 1996; Siguenza v. CA, 137 SCRA 570; PNB v. CA, GR 108870, July 14, 1995). (See Annex “M”, supra).
The social justice clause or parens patriae clause, the due process clause, and the equal protection clause of the Constitution support the contention of RAGUDO in this respect. (Sec. 9, Art. II, 1987 Constitution; Sec. 10, Art. II, id.; Sec. 1, Art. III, id.; Secs. 1-2, Art. XIII, id.; Sec. 9-10, Art. XIII, id.; etc.).
The admission, inter alia, of the letter of Nov. 21, 1989 of Aurelio Ragudo would have greatly altered the result of the main case, for it would prove that indeed RAGUDO signified their desire and willingness to become members of FABELLA and to pay the down payment of P25,000 to avail of the housing project. The corrupt officials of FABELLA rejected their application and these officials divided the spoils among themselves and their relatives to the grave prejudice of RAGUDO. For instance, the awardee Mrs. de Guzman, to whom the Ragudo lot was awarded, had five (5) lots for her family in the Fabella housing project. (Annex “P” to “P-42"). The president Mrs. Nobleza also owned many units for her family and a big lot which she leased to an architect, who was related to her, for business purposes. The awardee Mrs. de Guzman and the president Mrs. Nobleza fraudulently abused their powers to deprive the poor and old and sickly RAGUDO of the subject lot and family home which they have been occupying for more than 44 years. The CA did not appreciate this glaring fact.
C. The Legal Issue of “Acquisitive Prescription and Equitable Laches”
1. The Land Registration Authority (LRA) had confirmed that the grandparent title of TCT No. 2902 in the name of FABELLA, i.e., OCT No. 13 (Decree No. 240, LRC Rec. No. 699, 875, 917) was non-existent in its records. (see Annex “O”, supra, p. 2).
2. It is admitted by FABELLA that the RAGUDOs have been living in the subject lot, in the concept of owners, for the past 44 years as of the time of the initiation of the RTC suit. RAGUDO proved that he had been paying the realty taxes for the lot (Exhs. 12-13 for RAGUDO). Possession, backed up by a tax declaration, is a proof of an adverse claim of ownership. This is a basic doctrine in this jurisdiction.
3. The RTC denied admission in evidence of TCT No. 2902 in the name of FABELLA, which was its basic proof of ownership. (RTC Order, dated Oct. 18, 1993, supra). The trial court rejected TCT No. 14979, the immediate parent of TCT No. 2970 (id.).
4. FABELLA’s TCT No. 2902 was issued in 1989. Its supposed source, OCT No. 13 (Decree No. 240, LRC Rec. No. 699, 875, 917) was issued in 1904. Its original survey was done in 1927 and its subdivision survey in 1926. Thus, the OCT was issued ahead by 23 years of the alleged original survey. (Annex O”, supra, p. 4). These are badges of frauds and of the nullity of the OCT No. 13 (of the predecessor of FABELLA) and of TCT No. 2902 of FABELLA itself.
5. In the case of Widows and Orphans Assoc. v. CA, GR 91797, Aug. 28, 1991, the Supreme Court included OCT No. 13 and its Decree no. 240 among the list of the various “Ortigas titles and decrees” declared to be illegal in the said case. This is the predecessor OCT of FABELLA’s TCT No. 2902. In the said decision, the Supreme Court stated that simple possession of a certificate of title does make the possessor the true owner; that the possessor who obtained the same by mistake or oversight, much less bad faith, cannot become the owner thereof; and that where the certificate itself is faulty, it is not a conclusive proof of ownership.
6. The provision of PD 1529 that land titles are imprescriptible is not absolute. Equity tempers such rule. (Pena, Registration of Land Titles, 1980 ed., p. 137, citing Mejia v. Gamponia, GR 23072, Nov. 29, 1968).
7. Arts. 540, 1129, and 1137 of the Civil Code should be appreciated in favor of RAGUDO, having been in possession of the subject lot for more than 44 years in the concept of owners. At the least, their “vested right” of possession should be given great weight by virtue of acquisitive prescription, estoppel, and/or equitable laches.
8. The RTC decision itself recognized that, notwithstanding the general rule of imprecriptibility of land titles under PD 1529, there are instances where the equitable principle of laches may operate against such general rule. (Lola v. Ca, 145 SCRA 439). (see RTC decision, Annex “J ”, p. 2, supra).
9. Other cases where equitable laches has been upheld by the Supreme Court include Wright v. Lepanto, 11 SCRA 508; Miguel v. Catalino, 26 SCRA 234; Lutero v. Siulong, 54 Phil. 272; De Luna v. CA, 212 SCRA 276; Coronado v. CA, 191 SCRA 814; Samson v. CA, 192 SCRA 909).
10. Stale demand prevents recovery by the alleged title owner of the property as held, for instance, in Mejia v. Gamponia, 100 Phil. 277; Miguel v. Catalino, GR 23072, Nov. 29, 1968, in Pena, Registration of Land Titles, supra). The Torrens System may not be used as a shield for frauds or to abuse a helpless citizen (Gustilo v. Maravilla, 48 Phil. 442, cited in Pena, supra).
11. FABELLA was estopped from questioning the possession of RAGUDO because it knew that the latter had been in possession of the subject lot for more than 44 years. FABELLA based its suit on its 1989 title. But the rule is that FABELLA merely stepped into the shoes of its predecessor as the buyer of the land. Its officers had direct personal knowledge of the fact that RAGUDO have been occupying and living in the subject lot for more than 44 years in the concept of an owner.
VI. CONCLUDING STATEMENT
All that RAGUDO ask of this Honorable Court is a fair opportunity to avail of the housing project in FABELLA. They invoke the sense of social justice and compassion of this Honorable Court. They had manifested in 1989 their willingness to become members of FABELLA and their readiness to pay the down payment of P25,000. But FABELLA unfairly awarded their lot to Mrs. de Guzman, who, in turned out, had five (5) units already allotted to herself and her sons and who appears to be in cahoot with the president of FABELLA, Mrs. Nobleza, in making money out of the housing project. This is not what social justice and socialized housing is all about. The CMP of the NHMFC was created to help the poor, the old, the sickly and the indigent, like RAGUDO, to own decent family homes to improve the quality of their lives and to vest in them the dignity that is due to each human being. A socialized housing
project, like that in FABELLA, ought not to be a milking cow of its officials and favored few members, like Mr. de Guzman and Mrs. Nobleza. Otherwise, we will defeat the meaning of social justice.
X x x.
(end of quotation of petition)
