G.R. No.171555 April 17, 2013 EVANGELINE RIVERA-CALINGASAN and E. RICAL ENTERPRISES, Petitioners, vs.

WILFREDO RIVERA, substituted by MA. LYDIA S. RlVERA, FREIDA LEAH S. RIVERA and WILFREDO S. RIVERA, .JR., Respondents. BRION, J.: We resolve the petition for review on certiorari, 1 filed by petitioners Evangeline Rivera-Calingasan and E. Rical Enterprises,2 assailing the February 10, 2006 decision3 of the Court of Appeals ( CA) in CA-G.R. SP No. 90717. The CA decision affirmed with modification the April 6, 2005 Decision4 and the July 8, 2005 order5 of the Regional Trial Court (RTC) of Lipa City, Branch 85, in Civil Case No. 2003-0982. The Factual Antecedents During their lifetime, respondent Wilfredo Rivera and his wife, Loreto Inciong, acquired several parcels of land in Lipa City, Batangas, two of which were covered by Transfer Certificate of Title (TCT) Nos. T-22290 and T-30557.6On July 29, 1982, Loreto died, leaving Wilfredo and their two daughters, Evangeline and Brigida Liza, as her surviving heirs. 7 About eleven (11) years later, or on March 29, 1993, Loretos heirs executed an extrajudicial settlement of her one-half share of the conjugal estate, adjudicating all the properties in favor of Evangeline and Brigida Liza; Wilfredo waived his rights to the properties, with a reservation of his usufructuary rights during his lifetime.8 On September 23, 1993, the Register of Deeds of Lipa City, Batangas cancelled TCT Nos. T-22290 and T-30557 and issued TCT Nos. T-87494 and T87495 in the names of Evangeline and Brigida Liza, with an annotation of Wilfredos usufructuary rights.9 Almost a decade later, or on March 13, 2003,10 Wilfredo filed with the Municipal Trial Court in Cities (MTCC) of Lipa City a complaint for forcible entry against the petitioners and Star Honda, Inc., docketed as Civil Case No. 0019-03. Wilfredo claimed that he lawfully possessed and occupied the two (2) parcels of land located along C.M. Recto Avenue, Lipa City, Batangas, covered by TCT Nos. T-87494 and T-87495, with a building used for his furniture business. Taking advantage of his absence due to his hospital confinement in September 2002, the petitioners and Star Honda, Inc. took possession and caused the renovation of the building on the property. In December 2002, the petitioners and Star Honda, Inc., with the aid of armed men, barred him from entering the property. 11 Both the petitioners and Star Honda, Inc. countered that Wilfredo voluntarily renounced his usufructuary rights in a petition for cancellation of usufructuary rights dated March 4, 1996, 12 and that another action between the same parties is pending with the RTC of Lipa City, Branch 13 (an action for the annulment of the petition for cancellation of usufructuary rights filed by Wilfredo), docketed as Civil Case No. 99-0773. The MTCC Ruling

In its December 2, 2003 decision,13 the MTCC dismissed the complaint. It found no evidence of Wilfredos prior possession and subsequent dispossession of the property. It noted that Wilfredo admitted that both E. Rical Enterprises and Star Honda, Inc. occupied the property through lease contracts from Evangeline and her husband Ferdinand. Wilfredo appealed to the RTC. The RTC Ruling In its November 30, 2004 decision,14 the RTC affirmed the MTCCs findings. It held that Wilfredo lacked a cause of action to evict the petitioners and Star Honda, Inc. since Evangeline is the registered owner of the property and Wilfredo had voluntarily renounced his usufructuary rights. Wilfredo sought reconsideration of the RTCs decision and, in due course, attained this objective; the RTC set aside its original decision and entered another, which ordered the eviction of the petitioners and Star Honda, Inc. In its April 6, 2005 decision,15 the RTC held that Wilfredos renunciation of his usufructuary rights could not be the basis of the complaints dismissal since it is the subject of litigation pending with the RTC of Lipa City, Branch 13. The RTC found that the MTCC overlooked the evidence proving Wilfredos prior possession and subsequent dispossession of the property, namely: (a) Evangelines judicial admission of "J. Belen Street, Rosario, Batangas" as her residence since May 2002; (b) the Lipa City Prosecutors findings, in a criminal case for qualified trespass to dwelling, that the petitioners are not residents of the property; (c) the affidavit of Ricky Briones, Barangay Captain of Barangay 9, Lipa City where the property is located, attesting to Wilfredos prior possession and the petitioners entry to the property during Wilfredos hospital confinement; and (d) the petitioners, with the aid of armed men, destroyed the padlock of the building on the property. The RTC ordered the petitioners and Star Honda, Inc. to pay P620,000.00 as reasonable compensation for the use and occupation of the property, andP20,000.00 as attorneys fees. The petitioners and Star Honda, Inc. filed separate motions for reconsideration. In its July 8, 2005 order,16 the RTC modified its April 6, 2005 decision by absolving Star Honda, Inc. from any liability. It found no evidence that Star Honda, Inc. participated in the dispossession. The petitioners then filed a Rule 42 petition for review with the CA. The CA Ruling In its February 10, 2006 decision,17 the CA affirmed with modification the RTCs findings, noting that: (a) Evangelines admission of "J. Belen Street, Rosario, Batangas" as her residence (a place different and distinct from the property) rendered improbable her claim of possession and occupation; and (b) Evangelines entry to the property (on the pretext of repairing the building) during Wilfredos hospital confinement had been done without Wilfredos prior consent and was done through strategy and stealth. The CA, however, deleted the award ofP20,000.00 as

attorneys fees since the RTC decision did not contain any discussion or justification for the award. The petitioners then filed the present petition. Wilfredo died on December 27, 2006 and has been substituted by his second wife, Ma. Lydia S. Rivera, and their children, Freida Leah S. Rivera and Wilfredo S. Rivera, Jr. (respondents). 18 The Petition The petitioners submit that the CA erred in equating possession with residence since possession in forcible entry cases means physical possession without qualification as to the nature of possession, i.e., whether residing or not in a particular place. They contend that the pronouncements of the RTC of Lipa City, Branch 13, in Civil Case No. 99-0773, in the March 11, 2003 order,19 that they have been "occupying the premises since 1997"20 and Wilfredos own admission that he padlocked the doors of the building contradict Wilfredos claim of prior possession. The Case for the Respondents The respondents counter that the petitioners mistakenly relied on the statements of the RTC of Lipa City, Branch 13, in Civil Case No. 99-0773 on the petitioners occupation since 1997; such statements had been rendered in an interlocutory order, and should not prevail over Evangelines admission in her answer of "Poblacion, Rosario, Batangas"21 as her residence, compared to Wilfredos admission in his complaint of "C.M. Recto Avenue, Lipa City, Batangas" as his residence, the exact address of the disputed property. 22 The Issue The case presents to us the issue of who, between the petitioners and Wilfredo, had been in prior physical possession of the property. Our Ruling The petition lacks merit. Ejectment cases involve only physical possession or possession de facto. "Ejectment cases - forcible entry and unlawful detainer - are summary proceedings designed to provide expeditious means to protect actual possession or the right to possession of the property involved. The only question that the courts resolve in ejectment proceedings is: who is entitled to the physical possession of the premises, that is, to the possession de facto and not to the possession de jure. It does not even matter if a party's title to the property is questionable."23 Thus, "an ejectment case will not necessarily be decided in favor of one who has presented proof of ownership of the subject property." 24 Indeed, possession in ejectment cases "means nothing more than actual physical possession, not legal possession in the sense contemplated in civil law."25 In a forcible entry case, "prior physical

possession is the primary consideration."26 "A party who can prove prior possession can recover such possession even against the owner himself. Whatever may be the character of his possession, if he has in his favor prior possession in time, he has the security that entitles him to remain on the property until a person with a better right lawfully ejects him." 27"The party in peaceable, quiet possession shall not be thrown out by a strong hand, violence, or terror." 28 The respondents have proven prior physical possession of the property. In this case, we are convinced that Wilfredo had been in prior possession of the property and that the petitioners deprived him of such possession by means of force, strategy and stealth. The CA did not err in equating residence with physical possession since residence is a manifestation of possession and occupation. Wilfredo had consistently alleged that he resided on "C.M. Recto Avenue, Lipa City, Batangas," the location of the property, whereas Evangeline has always admitted that she has been a resident of "J. Belen Street, Rosario, Batangas." The petitioners failed to prove that they have occupied the property through some other person, even if they have declared their residence in another area. We note that in another proceeding, a criminal complaint for qualified trespass to dwelling, the Lipa City Prosecutor also observed that the petitioners did not reside on or occupy the property on December 16, 2002,29about three (3) months before Wilfredo filed the complaint for forcible entry on March 13, 2003. The petitioners also alleged therein that they are residents of "J. Belen St., Rosario, Batangas" and not "No. 30 C.M. Recto Ave., Lipa City." 30 Furthermore, the petitioners failed to rebut the affidavit of Barangay Captain Briones attesting to Wilfredos prior possession and the petitioners unlawful entry to the property during Wilfredos hospital confinement.31 The petitioners claim of physical possession cannot find support in the March 11, 2003 order 32 of the RTC of Lipa City, Branch 13, in Civil Case No. 99-0773 stating that the petitioners "have been occupying the premises since 1997." We note that the order was a mere interlocutory order on Wilfredos motion for the issuance of a cease and desist order. An interlocutory order does not end the task of the court in adjudicating the parties' contentions and determining their rights and liabilities against each other. "It is basically provisional in its application." 33 It is the nature of an interlocutory order that it is subject to modification or reversal that the result of further proceedings may warrant. Thus, the RTCs pronouncement on the petitioners occupation "since 1997" is not res judicata on the issue of actual physical possession. In sum, we find no reversible error in the decision appealed from and, therefore, affirm it. Wilfredos death did not render moot the forcible entry case. The death of Wilfredo introduces a seeming complication into the case and on the disposition we shall make. To go back to basics, the petition before us involves the recovery of possession of real property and is a real action that is not extinguished by the death of a party. The judgment in

an ejectment case is conclusive between the parties and their successors-in-interest by title subsequent to the commencement of the action; hence, it is enforceable by or against the heirs of the deceased.1wphi1 This judgment entitles the winning party to: (a) the restitution of the premises, (b) the sum justly due as arrears of rent or as reasonable compensation for the use and occupation of the premises, and (c) attorneys fees and costs. The complicating factor in the case is the nature and basis of Wilfredos possession; he was holding the property as usufructuary, although this right to de jure possession was also disputed before his death, hand in hand with the de facto possession that is subject of the present case. Without need, however, of any further dispute or litigation, the right to the usufruct is now rendered moot by the death of Wilfredo since death extinguishes a usufruct under Article 603(1) of the Civil Code. This development deprives the heirs of the usufructuary the right to retain or to reacquire possession of the property even if the ejectment judgment directs its restitution. Thus, what actually survives under the circumstances is the award of damages, by way of compensation, that the RTC originally awarded and which the CA and this Court affirmed. This award was computed as of the time of the RTC decision (or roughly about a year before Wilfredos death) but will now have to take into account the compensation due for the period between the RTC decision and Wilfredos death. The computation is a matter of execution that is for the RTC, as court of origin, to undertake. The heirs of Wilfredo shall succeed to the computed total award under the rules of succession, a matter that is not within the authority of this Court to determine at this point. WHEREFORE, we hereby DENY the appeal and accordingly AFFIRM the February 10, 2006 decision of the Court of Appeals in CA-G.R. SP No. 90717 with the MODIFICATION that, with the termination, upon his death, of respondent Wilfredo Riveras usufructory over the disputed property, the issue of restitution of possession has been rendered moot and academic; on the other hand, the monetary award of P620,000.00, as reasonable compensation for the use and occupation of the property up to the time of the Regional Trial Court decision on April 6, 2005, survives and accrues to the estate of the deceased respondent Wilfredo Rivera, to be distributed to his heirs pursuant to the applicable law on succession. Additional compensation accrues and shall be added to the compensation from the time of the Regional Trial Court decision up to respondent Wilfredo Riveras death. For purposes of the computation of this additional amount and for the execution of the total amount due under this Decision, we hereby remand the case to the Regional Trial Court, as court of origin, for appropriate action. Costs against petitioners Evangeline Rivera-Calingasan and E. Rical Enterprises. SO ORDERED.

SERENO, CJ.: This is a Petition for Review under Rule 45 assailing the Decision 1 and Resolution2 of the Court of Appeals (CA) in CA-G.R. SP No. 97862. The CA recalled and set aside the Order 3 of the Municipal Trial Court in Cities (MTCC), Branch 2, Malo los City, and granted respondents' Motion to Quash Alias Writ of Possession and Demolition4 in Civil Case Nos. 03-140 to 03-143. The Facts of the case are as follows: A parcel of land located in Sumapang, Malolos City is registered in the name of Freddie Santiago (Santiago) under Transfer Certificate of Title (TCT) No. 103697. 5 On 23 August 1999, petitioner Holy Trinity Realty Development Corporation (HTRDC) acquired the property from Santiago, but later found that the lot was already occupied by some individuals, among them respondentspouses Carlos and Elizabeth Abacan.6 HTRDC then filed a complaint for forcible entry against respondent-spouses and the other occupants. It withdrew the complaint, however, because it needed to verify the exact location of the property, which the occupants claimed was covered by emancipation patents issued by the Department of Agrarian Reform Adjudication Board (DARAB). HTRDC commenced a complaint with the DARAB for cancellation of emancipation patents against some of the occupants of the land. During the pendency of the DARAB case, the occupants possession was tolerated.7 On 30 April 2002, the provincial adjudicator ordered the cancellation of the emancipation patents of the occupants of the land. 8 The DARAB later affirmed the decision of the provincial adjudicator. 9 On 4 November 2003, HTRDC filed a complaint for unlawful detainer and damages with the MTCC of Malolos against the occupants of the subject land, again including respondent spouses.10 Petitioner alleged that from the time it purchased the property in 1999 until the pendency of the DARAB case, it had no immediate need for the subject parcel of land. When the need arose, it made both verbal and written demands on the occupants to vacate the property. Despite its final demand on 17 June 2003, the occupants failed to vacate the property. Thus, HTRDC had to resort to the filing of an ejectment case against them. Proceedings in the MTCC ensued, culminating in a Decision in favor of HTRDC. The trial court ordered the occupants to vacate the premises and to pay reasonable rent, attorneys fees and costs of suit.11 Respondents moved to reconsider the decision, but their motion for reconsideration was denied for being a prohibited pleading in summary proceedings. The MTCC then ordered the issuance of a writ of execution.12 Respondents appealed on 15 August 2005, but their appeal was denied due course for being filed out of time, as the period to appeal had not been stayed by the filing of the motion for reconsideration.13 Thus, the Decision became final and executory.

G.R. No. 183858 April 17, 2013 HOLY TRINITY REALTY DEVELOPMENT CORPORATION, represented by JENNIFER R. MARQUEZ,Petitioner, vs. SPOUSES CARLOS AND ELIZABETH ABACAN, Respondents.

Meanwhile, the provincial agrarian reform officer (PARO) filed an action for annulment of sale against HTRDC.14Respondents thereafter moved to stay execution on the ground that a supervening event had transpired.15 The MTCC denied the motion, ruling that the mere filing of an action by the PARO did not materially change the situation of the parties, and hence, may not be considered as a supervening event.16 In order to prevent the enforcement of the writ of execution and demolition, respondents filed several actions in the Regional Trial Court (RTC), to wit: (1) Civil Case No. 245-M-2006 for annulment of judgment;17 (2) Special Civil Action No. 364-M-2006 for certiorari; 18 and (3) Civil Case No. 59-M-2007 for quieting of title.19 Civil Case No. 245-M-2006 and Special Civil Action No. 364-M-2006 were both dismissed by the RTC on the grounds of forum shopping and immutability of final judgment,20 while Civil Case No. 59-M-2007 was dismissed on the ground of finality of judgment.21 Respondents did not appeal any of the adverse rulings. The MTCC issued an Alias Writ of Execution on 25 October 2006, 22 and an Alias Special Order of Demolition on 28 October 2006.23 Respondents moved to quash both writs on the ground that Emancipation Patent Nos. 00780489 and 00780490 had been issued in their favor during the pendency of the case. As such, they argued that they had now acquired ownership of relevant portions of the subject property.24 The MTCC denied their motion on the ground that respondents acquisition of ownership is not a supervening event that will bar the execution of the judgment in the unlawful detainer case.25 From the Order of the MTCC denying their motion to quash, respondents filed directly with the CA a Special Civil Action for Certiorari with Prayer for a Temporary Restraining Order and Writ of Preliminary Injunction.26 The appellate court issued a Writ of Preliminary Injunction 27 and ultimately granted the petition for certiorari in a Decision dated 27 March 2008. The CA held that the MTCC had no jurisdiction over the unlawful detainer case, and disposed of the case as follows: IN VIEW OF ALL THE FOREGOING, the instant petition is hereby GRANTED and the Order dated January 17, 2007 of the Municipal Trial Court in Cities (MTCC), Branch 2 of Malolos City, Bulacan, issued in Civil Case No. 03-140, is RECALLED and SET ASIDE and, in lieu thereof, the Motion to Quash Alias Writ of Possession [sic] and Demolition of the petitioners in said case is GRANTED. The writ of preliminary injunction earlier issued is thus made permanent. No pronouncement as to costs. SO ORDERED.28 Aggrieved by the decision of the CA, petitioner HTRDC filed the instant petition for review before this Court. The Courts Ruling We find merit in the instant petition. Before proceeding to the merits of the case, we first deal with a procedural issue.

HTRDC correctly argued that respondents erred in filing the special civil action for certiorari directly with the CA instead of the RTC. In doing so, they violated the time-honored principle of respect for the hierarchy of courts. While this Court, the CA, and the RTC have concurrent jurisdiction to issue writs of certiorari the parties to a suit are not given unbridled freedom to choose between court forums.29 Judicial hierarchy indicates that "petitions for the issuance of extraordinary writs against first level ("inferior") courts should be filed with the RTC, and those against the latter, with the CA."30 Therefore, respondents petition for certiorari was dismissible outright on procedural grounds. Turning now to the merits of the petition, we find that the CA committed reversible error in ruling that the MTCC had no jurisdiction over the unlawful detainer case. What was before it was a petition for certiorari against the MTCCs denial of respondents motion to quash. The petition was not directed at the MTCCs Consolidated Decision of 25 May 2005, nor could it be, because a Rule 65 petition for certiorari must be filed not later than 60 days from notice of the judgment.31 Since respondents failed to timely appeal the Consolidated Decision, it has long attained finality and has become immutable and unalterable pursuant to the doctrine on finality of judgment.32 Thus, as respondents sole argument in their motion to quash was the existence of a material supervening event, and as the MTCCs denial of their motion was premised on the conclusion that their subsequent acquisition of ownership was not a supervening event, the resolution of the present case should be limited to that issue. Did the MTCC commit grave abuse of discretion in denying respondents motion to quash? We rule in the negative. The term "grave abuse of discretion" has a specific meaning in jurisprudence. 1wphi1 In Litton Mills v. Galleon Traders,33we explained: An act of a court or tribunal may only be considered as committed in grave abuse of discretion when the same was performed in a capricious or whimsical exercise of judgment which is equivalent to lack of jurisdiction. The abuse of discretion must be so patent and gross as to amount to an evasion of positive duty or to a virtual refusal to perform a duty enjoined by law, or to act at all in contemplation of law, as where the power is exercised in an arbitrary and despotic manner by reason of passion and personal hostility. x x x. (Citation omitted) In this case, the motion to quash was grounded on the sole argument that the judgment should no longer be enforced because of the occurrence of a material supervening event. Respondents alleged that before the alias writs were issued, but after the MTCC rendered judgment in the unlawful detainer case, they had acquired ownership over the subject property as evidenced by Emancipation Patent Nos. 00780489 and 00780490.34 The MTCC correctly denied their motion, citing our ruling in Oblea v. Court of Appeals 35 and Chua v. Court of Appeals36 to the effect that the subsequent acquisition of ownership is not a supervening event that will bar the execution of the judgment in the unlawful detainer case. According to the MTCC:

This court gives due weight to the ruling of the Supreme Court in the cases of Oblea vs. Court of Appeals (244 SCRA 101) and Chua vs. Court of Appeals (271 SCRA 564), wherein it made a categorical pronouncement that the subsequent acquisition of ownership by any person is not a supervening event that will bar the execution of the judgment in the unlawful detainer case. True it is that the sole issue in an action for unlawful detainer x x x is physical or material possession. Such issue of physical or material possession was already passed upon by this court during trial. As held in the case of Dizon vs. Concina (30 SCRA 897), the judgment rendered in an action for forcible entry or 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. Such judgment shall not bar an action between the parties respecting title to the land or building. (Sec. 18, Rule 70, 1997 Rules of Civil Procedure)37 It is well-settled that the sole issue in ejectment cases is physical or material possession of the subject property, independent of any claim of ownership by the parties. 38 The argument of respondent-spouses that they subsequently acquired ownership of the subject property cannot be considered as a supervening event that will bar the execution of the questioned judgment, as unlawful detainer does not deal with the issue of ownership. As the case now stands, both parties are claiming ownership of the subject property: petitioner, by virtue of a Deed of Sale executed in its favor by the registered land owner; and respondents, by subsequently issued emancipation patents in their names. This issue would more appropriately be ventilated in a full-blown proceeding, rather than in a motion to stay the execution of the judgment rendered in the instant summary ejectment proceeding. To reiterate, the sole issue in the present case is de facto possession of the subject property, and this was conclusively settled by the MTCC in HTRDC's favor in its final and executory Consolidated Decision of 25 May 2005. We therefore rule that the CA committed reversible error in ruling that the MTCC committed grave abuse of discretion in denying respondents' motion to quash the alias writs of execution and demolition. WHEREFORE, the instant Petition for Review is GRANTED. The assailed Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 97862 dated 27 March 2008 and 14 July 2008, respectively, are hereby SET ASIDE and REVERSED. The Order dated 17 January 2007 of the Municipal Trial Court in Cities, Branch 2, Malolos City, in Civil Case Nos. 03-140 to 03-143 is hereby REINSTATED. SO ORDERED.

We resolve the petition for review on certiorari,1 filed by petitioner Isabel N. Guzman, assailing the February 3, 2006 decision2 and the April 17, 2006 resolution3 of the Court of Appeals (CA) in CAG.R. SP No. 90799. The CA decision dismissed the petitioners petition for certiorari for being the wrong mode of appeal and for lack of merit. The CA resolution denied the petitioners motion for reconsideration for lack of merit. THE FACTUAL ANTECEDENTS On June 15, 2000, the petitioner filed with the Municipal Trial Court (MTC) of Tuguegarao City, Cagayan, Branch 4, a complaint for ejectment against her children, respondents Aniano N. Guzman and Primitiva G. Montealto.4The petitioner alleged that she and Arnold N. Guzman owned the 6/7th and 1/7th portions, respectively, of a 1,446-square meter parcel of land, known as Lot No. 2419-B, in Tuguegarao City, Cagayan, under Transfer Certificate of Title No. T74707;5 the respondents occupied the land by tolerance; the respondents did not comply with her January 17, 2000 written demand to vacate the property; 6 and subsequent barangay conciliation proceedings failed to settle the differences between them. 7 In their answer,8 the respondents countered that the petitioner transferred, in a December 28, 1996 document,9all her property rights in the disputed property, except her usufructuary right, in favor of her children, and that the petitioner engaged in forum shopping since she already raised the issue of ownership in a petition for cancellation of adverse claim against the respondents, pending with Branch 4 of the Regional Trial Court (RTC) of Tuguegarao City, Cagayan. 10 THE MTCs RULING In a November 27, 2002 decision,11 the MTC found the petitioner to be the lawful owner of the land with a right to its possession since the respondents had no vested right to the land since they are merely the petitioners children to whom no ownership or possessory rights have passed. It held that the petitioner committed no forum shopping since she asserted ownership only to establish her right of possession, and the lower courts can provisionally resolve the issue of ownership to determine who has the better right of possession. The MTC directed the respondents to vacate the land and surrender possession to the petitioner, and to pay P5,000.00 as monthly rental from January 2000 until possession is surrendered, plus P15,000.00 as moral and exemplary damages. The respondents appealed to the RTC of Tuguegarao City, Cagayan, Branch 1. 12 They argued that: (a) the MTC had no jurisdiction over the case; (b) the petitioner has no cause of action against the respondents; (c) the petitioner engaged in forum shopping; and (d) the MTC erred in deciding the case in the petitioners favor.13

G.R. No. 172588 March 13, 2013 ISABEL N. GUZMAN, Petitioner, vs. ANIANO N. GUZMAN and PRIMITIVA G. MONTEALTO, Respondents. BRION, J.:

THE RTCs RULING In its May 19, 2005 decision,14 the RTC rejected the respondents arguments, finding that the MTC has jurisdiction over ejectment cases under Section 33(2) of Batas Pambansa Bilang 129; 15 the petitioner has a valid cause of action against the respondents since the complaint alleged the

petitioners ownership, the respondents possession by tolerance, and the respondents refusal to vacate upon the petitioners demand; and, the petitioner did not engage in forum shopping since the petition for the cancellation of adverse claim has a cause of action totally different from that of ejectment. The RTC, however, still ruled for the respondents and set aside the MTC ruling. It took into account the petitioners transfer of rights in the respondents favor which, it held, could not be unilaterally revoked without a court action. It also noted that the petitioner failed to allege and prove that earnest efforts at a compromise have been exerted prior to the filing of the complaint.16 Thus, the RTC ordered the petitioner to pay the respondentsP25,000.00 as attorneys fees and P25,000.00 as litigation expenses. On June 16, 2005, the petitioner received a copy of the RTC decision. 17 On June 30, 2005, the petitioner filed her first motion for reconsideration. 18 In its July 6, 2005 order,19 the RTC denied the petitioners motion for reconsideration for lack of the required notice of hearing. 20 On July 14, 2005, the petitioner filed a second motion for reconsideration. 21 In its July 15, 2005 order,22 the RTC denied the second motion for reconsideration for having been filed out of time. On July 20, 2005, the petitioner filed a third motion for reconsideration. 23 In its July 22, 2005 order,24 the RTC denied the third motion for reconsideration with finality. On August 8, 2005, the petitioner filed a Rule 65 petition for certiorari with the CA, alleging that the RTC committed a grave abuse of discretion: (a) in deciding the case based on matters not raised as issues on appeal; (b) in finding that the transfer of rights could not be unilaterally revoked without a court action; (c) in holding that the petitioner failed to prove that earnest efforts at a compromise have been exerted prior to the filing of the complaint; and (d) in denying the petitioners motion for reconsideration on a mere technicality. THE CAs RULING In its February 3, 2006 decision,25 the CA dismissed the petition. The CA noted that a Rule 42 petition for review, not a Rule 65 petition for certiorari, was the proper remedy to assail an RTC decision rendered in the exercise of its appellate jurisdiction. It found that the petitioner lost her chance to appeal when she filed a second motion for reconsideration, a prohibited pleading under Section 5, Rule 37 of the Rules of Court. The CA also held that the petitioner cannot validly claim that the respondents occupied the properties through mere tolerance since they were co-owners of the property as compulsory heirs of Alfonso Guzman, the original owner. When the CA denied26 the motion for reconsideration27 that followed, the petitioner filed the present Rule 45 petition. THE PETITION

The petitioner justifies the filing of a Rule 65 petition for certiorari with the CA by claiming that the RTC judge acted with grave abuse of discretion in passing on issues not raised in the appeal and in not relaxing the rule on the required notice of hearing on motions. She further argues that the CAs finding of co-ownership is bereft of factual and legal basis. THE CASE FOR THE RESPONDENTS The respondents submit that the proper remedy for appealing a decision of the RTC, exercising appellate jurisdiction, is a Rule 42 petition for review, and that a Rule 65 petition for certiorari is not a substitute for a lost appeal. THE ISSUE The case presents to us the issue of whether the CA committed a reversible error in dismissing the petitioners petition for certiorari. THE COURTs RULING The petition lacks merit. The petitioner availed of the wrong remedy The petitioners resort to a Rule 65 petition for certiorari to assail the RTC decision and orders is misplaced. When the RTC issued its decision and orders, it did so in the exercise of its appellate jurisdiction; the proper remedy therefrom is a Rule 42 petition for review. 28 Instead, the petitioner filed a second motion for reconsideration and thereby lost her right to appeal; a second motion for reconsideration being a prohibited pleading pursuant to Section 5, Rule 37 of the Rules of Court.29 The petitioners subsequent motions for reconsideration should be considered as mere scraps of paper, not having been filed at all, and unable to toll the reglementary period for an appeal. The RTC decision became final and executory after fifteen (15) days from receipt of the denial of the first motion for reconsideration. It is elementary that once a decision becomes final and executory, it is "immutable and unalterable, and can no longer be modified in any respect, even if the modification is meant to correct what is perceived to be an erroneous conclusion of fact or law, and regardless of whether the modification is attempted to be made by the court rendering it or by the highest court of the land."30 Thus, the RTC decision, even if allegedly erroneous, can no longer be modified. Apparently, to resurrect her lost appeal, the petitioner filed a Rule 65 petition for certiorari, imputing grave abuse of discretion on the RTC for deciding the case against her. Certiorari, by its very nature, is proper only when appeal is not available to the aggrieved party; the remedies of appeal and certiorari are mutually exclusive, not alternative or successive. 31 It cannot substitute for a lost appeal, especially if one's own negligence or error in one's choice of remedy occasioned such loss or lapse.32 No grave abuse of discretion

In any case, even granting that the petition can be properly filed under Rule 65 of the Rules of Court, we hold that it was bound to fail.1wphi1 It should be noted that as a legal recourse, certiorari is a limited form of review. 33 It is restricted to resolving errors of jurisdiction and grave abuse of discretion, not errors of judgment. 34 Indeed, as long as the lower courts act within their jurisdiction, alleged errors committed in the exercise of their discretion will amount to mere errors of judgment correctable by an appeal or a petition for review.35 In this case, the imputed errors pertained to the RTCs appreciation of matters not raised as errors on appeal, specifically, the transfer of rights and subsequent unilateral revocation, and the strictly enforced rule on notice of hearing. These matters involve only the RTCs appreciation of facts and its application of the law; the errors raised do not involve the RTCs jurisdiction, but merely amount to a claim of erroneous exercise of judgment.1wphi1 Besides, the RTC acted within its jurisdiction in considering the matter of the petitioners transfer of rights, even if it had not been raised as an error. Under Section 18, Rule 70 of the Rules of Court,36 the RTC is mandated to decide the appeal based on the entire record of the MTC proceedings and such pleadings submitted by the parties or required by the RTC. Nonetheless, even without this provision, an appellate court is clothed with ample authority to review matters, even if they are not assigned as errors on appeal, if it finds that their consideration is necessary in arriving at a just decision of the case, or is closely related to an error properly assigned, or upon which the determination of the question raised by error properly assigned is dependent. 37 The matter of the petitioners transfer of rights, which was in the records of the case, was the basis for the RTCs decision. The RTC did not also commit a grave abuse of discretion in strictly enforcing the requirement of notice of hearing. The requirement of notice of hearing is an integral component of procedural due process that seeks to avoid "surprises that may be sprung upon the adverse party, who must be given time to study and meet the arguments in the motion before a resolution by the court."38 Given the purpose of the requirement, a motion unaccompanied by a notice of hearing is considered a mere scrap of paper that does not toll the running of the period to appeal. This requirement of notice of hearing equally applies to the petitioners motion for reconsideration.39 The petitioners alleged absence of counsel is not a valid excuse or reason for non-compliance with the rules. A final point Ejectment cases are summary proceedings intended to provided an expeditious means of protecting actual possession or right of possession of property. Title is not involved, hence, it is a special civil action with a special procedure. The only issue to be resolved in ejectment cases is the question of entitlement to the physical or material possession of the premises or possession de facto. Thus, any ruling on the question of ownership is only provisional, made solely for the purpose of determining who is entitled to possession de facto. 40 Accordingly, any ruling on the validity of the petitioners transfer of rights is provisional and should be resolved in a proper proceeding.

WHEREFORE, we hereby DENY the appeal. The February 3, 2006 decision and the April 17, 2006 resolution of the Court of Appeals in CA- G.R. SP No. 90799 are AFFIRMED. Costs against petitioner Isabel N. Guzman. SO ORDERED.

G.R. No. 174436 January 23, 2013 JUANITA ERMITAO, represented by her Attorney-in-Fact, ISABELO ERMITAO, Petitioner, vs. LAILANIE M. PAGLAS, Respondent. PERALTA, J.: Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to reverse and set aside the Decision1 and Resolution2 dated September 8, 2004 and August 16, 2006, respectively, of the Court of Appeals (CA) in CA-G.R. SP No. 77617. On November 5, 1999, herein respondent and petitioner, through her representative, lsabelo R. Ermitao, executed a Contract of Lease wherein petitioner leased in favor of respondent a 336 square meter residential lot and a house standing thereon located at No. 20 Columbia St., Phase l, Doa Vicenta Village, Davao City. The contract period is one (1) year, which commenced on November 4, 1999, with a monthly rental rate of P13,500.00. Pursuant to the contract, respondent paid petitioner P2,000.00 as security deposit to answer for unpaid rentals and damage that may be cause to the leased unit. Subsequent to the execution of the lease contract, respondent received information that sometime in March 1999, petitioner mortgaged the subject property in favor of a certain Charlie Yap (Yap) and that the same was already foreclosed with Yap as the purchaser of the disputed lot in an extra-judicial foreclosure sale which was registered on February 22, 2000. Yap's brother later offered to sell the subject property to respondent. Respondent entertained the said offer and negotiations ensued. On June 1, 2000, respondent bought the subject property from Yap for P950,000.00. A Deed of Sale of Real Property was executed by the parties as evidence of the contract. However, it was made clear in the said Deed that the property was still subject to petitioner's right of redemption. Prior to respondent's purchase of the subject property, petitioner filed a suit for the declaration of nullity of the mortgage in favor of Yap as well as the sheriff's provisional certificate of sale which was issued after the disputed house and lot were sold on foreclosure. Meanwhile, on May 25, 2000, petitioner sent a letter demanding respondent to pay the rentals which are due and to vacate the leased premises. A second demand letter was sent on March 25, 2001. Respondent ignored both letters. On August 13, 2001, petitioner filed with the Municipal Trial Court in Cities (MTCC), Davao City, a case of unlawful detainer against respondent.

In its Decision dated November 26, 2001, the MTCC, Branch 6, Davao City dismissed the case filed by petitioner and awarded respondent the amounts of P25,000.00 as attorney's fees and P2,000.00 as appearance fee. Petitioner filed an appeal with the Regional Trial Court (RTC) of Davao City. On February 14, 2003, the RTC rendered its Decision, the dispositive portion of which reads as follows: WHEREFORE, PREMISES CONSIDERED, the assailed Decision is AFFIRMED with MODIFICATION. AFFIRMED insofar as it dismissed the case for unlawful detainer but modified in that the award of attorney's fees in defendant's herein respondent's favor is deleted and that the defendant respondent is ordered to pay plaintiff herein petitioner the equivalent of ten months unpaid rentals on the property or the total sum of P135,000.00. SO ORDERED.3 The RTC held that herein respondent possesses the right to redeem the subject property and that, pending expiration of the redemption period, she is entitled to receive the rents, earnings and income derived from the property. Aggrieved by the Decision of the RTC, petitioner filed a petition for review with the CA. On September 8, 2004, the CA rendered its assailed Decision disposing, thus: WHEREFORE, premises considered, the assailed Decision of the Regional Trial Court, Branch 16, 11th Judicial Region, Davao City is AFFIRMED with the MODIFICATIONS as follows: (a) Private respondent's obligation to pay the petitioner the amount of ONE HUNDRED THIRTY-FIVE THOUSAND PESOS (P135,000.00) equivalent of ten (10) months is hereby DELETED; (b) Attorney's fees and litigation expenses were correctly awarded by the trial court having compelled the private respondent to litigate and incur expenses to protect her interests by reason of the unjustified act of petitioner (Producers Bank of the Philippines vs. Court of Appeals, 365 SCRA 326), Thus: litigation expenses of only TEN THOUSAND PESOS (P10,000.00) not TWENTY-FIVE THOUSAND PESOS (P25,000.00); and (c) Attorney's fees REI NSTAT ED in the amount of TEN THOUSAND PESOS (P10,000.00) instead of only TWO THOUSAND PESOS (P2,000.00). SO ORDERED.4

Quoting extensively from the decision of the MTCC as well as on respondent's comment on the petition for review, the CA ruled that respondent did not act in bad faith when she bought the property in question because she had every right to rely on the validity of the documents evidencing the mortgage and the foreclosure proceedings. Petitioner filed a Motion for Reconsideration, but the CA denied it in its Resolution dated August 16, 2006. Hence, the instant petition for review on certiorari raising the following assignment of errors: A.WHETHER OR NOT THE COURT OF APPEALS ERRED IN DISMISSING THE UNLAWFUL DETAINER CASE BY RULING THAT A SHERIFF'S FINAL CERTIFICATE OF SALE WAS ALREADY ISSUED WHICH DECISION IS NOT BASED ON THE EVIDENCE AND IN ACCORDANCE WITH THE APPLICABLE LAWS AND JURISPRUDENCE. B. WHETHER OR NOT THE COURT OF APPEALS ERRED WHEN IT RULED THAT PRIVATE RESPONDENT WAS A BUYER IN GOOD FAITH EVEN IF SHE WAS INFORMED BY PETITIONER THROUGH A LETTER ADVISING HER THAT THE REAL ESTATE MORTGAGE CONTRACT WAS SHAM, FICTITIOUS AS IT WAS A PRODUCT OF FORGERY BECAUSE PETITIONER'S PURPORTED SIGNATURE APPEARING THEREIN WAS SIGNED AND FALSIFIED BY A CERTAIN ANGELA CELOSIA. C. WHETHER OR NOT THE COURT OF APPEALS ERRED WHEN IT AWARDED ATTORNEY'S FEES WHICH WAS DELETED BY RTC-BRANCH 16 OF DAVAO CITY DESPITE THE ABSENCE OF ANY EXPLANATION AND/OR JUSTIFICATION IN THE BODY OF THE DECISION.5 At the outset, it bears to reiterate the settled rule that the only question that the courts resolve in ejectment proceedings is: who is entitled to the physical possession of the premises, that is, to the possession de facto and not to the possession de jure. 6 It does not even matter if a party's title to the property is questionable.7 In an unlawful detainer case, the sole issue for resolution is the physical or material possession of the property involved, independent of any claim of ownership by any of the party litigants.8 Where the issue of ownership is raised by any of the parties, the courts may pass upon the same in order to determine who has the right to possess the property.9 The adjudication is, however, merely provisional and would not bar or prejudice an action between the same parties involving title to the property. 10 In the instant case, pending final resolution of the suit filed by petitioner for the declaration of nullity of the real estate mortgage in favor of Yap, the MTCC, the RTC and the CA were unanimous in sustaining the presumption of validity of the real estate mortgage over the subject property in favor of Yap as well as the presumption of regularity in the performance of the duties of the public officers who subsequently conducted its foreclosure sale and issued a provisional certificate of sale. Based on the presumed validity of the mortgage and the subsequent

foreclosure sale, the MTCC, the RTC and the CA also sustained the validity of respondent's purchase of the disputed property from Yap. The Court finds no cogent reason to depart from these rulings of the MTCC, RTC and CA. Thus, for purposes of resolving the issue as to who between petitioner and respondent is entitled to possess the subject property, this presumption stands. Going to the main issue in the instant petition, it is settled that in unlawful detainer, one unlawfully withholds possession thereof after the expiration or termination of his right to hold possession under any contract, express or implied.11 In such case, the possession was originally lawful but became unlawful by the expiration or termination of the right to possess; hence, the issue of rightful possession is decisive for, in such action, the defendant is in actual possession and the plaintiffs cause of action is the termination of the defendants right to continue in possession. 12 In the instant petition, petitioner's basic postulate in her first and second assigned errors is that she remains the owner of the subject property. Based on her contract of lease with respondent, petitioner insists that respondent is not permitted to deny her title over the said property in accordance with the provisions of Section 2 (b), Rule 131 of the Rules of Court. The Court does not agree. The conclusive presumption found in Section 2 (b), Rule 131 of the Rules of Court, known as estoppel against tenants, provides as follows: Sec. 2. Conclusive presumptions. The following are instances of conclusive presumptions: xxxx (b) The tenant is not permitted to deny the title of his landlord at the time of the commencement of the relation of landlord and tenant between them. (Emphasis supplied). It is clear from the abovequoted provision that what a tenant is estopped from denying is the title of his landlord at the time of the commencement of the landlord-tenant relation. 13 If the title asserted is one that is alleged to have been acquired subsequent to the commencement of that relation, the presumption will not apply.14 Hence, the tenant may show that the landlord's title has expired or been conveyed to another or himself; and he is not estopped to deny a claim for rent, if he has been ousted or evicted by title paramount. 15 In the present case, what respondent is claiming is her supposed title to the subject property which she acquired subsequent to the commencement of the landlord-tenant relation between her and petitioner. Hence, the presumption under Section 2 (b), Rule 131 of the Rules of Court does not apply. The foregoing notwithstanding, even if respondent is not estopped from denying petitioner's claim for rent, her basis for such denial, which is her subsequent acquisition of ownership of the disputed property, is nonetheless, an insufficient excuse from refusing to pay the rentals due to petitioner.

There is no dispute that at the time that respondent purchased Yap's rights over the subject property, petitioner's right of redemption as a mortgagor has not yet expired. It is settled that during the period of redemption, it cannot be said that the mortgagor is no longer the owner of the foreclosed property, since the rule up to now is that the right of a purchaser at a foreclosure sale is merely inchoate until after the period of redemption has expired without the right being exercised.16 The title to land sold under mortgage foreclosure remains in the mortgagor or his grantee until the expiration of the redemption period and conveyance by the master's deed.17 Indeed, the rule has always been that it is only upon the expiration of the redemption period, without the judgment debtor having made use of his right of redemption, that the ownership of the land sold becomes consolidated in the purchaser. 18 Stated differently, under Act. No. 3135, the purchaser in a foreclosure sale has, during the redemption period, only an inchoate right and not the absolute right to the property with all the accompanying incidents.19 He only becomes an absolute owner of the property if it is not redeemed during the redemption period.20 Pending expiration of the period of redemption, Section 7 of Act No. 3135, 21 as amended, provides: Sec. 7. In any sale made under the provisions of this Act, the purchaser may petition the Court of First Instance of the province or place where the property or any part thereof is situated, to give him possession thereof during the redemption period, furnishing bond in an amount equivalent to the use of the property for a period of twelve months, to indemnify the debtor in case it be shown that the sale was made without violating the mortgage or without complying with the requirements of this Act. Such petition shall be made under oath and filed in [the] form of an ex parte motion in the registration or cadastral proceedings if the property is registered, or in special proceedings in the case of property registered under the Mortgage Law or under section one hundred and ninetyfour of the Administrative Code, or of any other real property encumbered with a mortgage duly registered in the office of any register of deeds in accordance with any existing law, and in each case the clerk of the court shall, upon the filing of such petition, collect the fees specified in paragraph eleven of section one hundred and fourteen of Act Numbered Four hundred and ninetysix, as amended by Act Numbered Twenty-eight hundred and sixty-six, and the court shall, upon approval of the bond, order that a writ of possession issue, addressed to the sheriff of the province in which the property is situated, who shall execute said order immediately. Thus, it is clear from the abovequoted provision of law that, as a consequence of the inchoate character of the purchaser's right during the redemption period, Act. No. 3135, as amended, allows the purchaser at the foreclosure sale to take possession of the property only upon the filing of a bond, in an amount equivalent to the use of the property for a period of twelve (12) months, to indemnify the mortgagor in case it be shown that the sale was made in violation of the mortgage or without complying with the requirements of the law. In Cua Lai Chu v. Laqui, 22 this Court reiterated the rule earlier pronounced in Navarra v. Court of Appeals 23 that the purchaser at an extrajudicial foreclosure sale has a right to the possession of the property even during the oneyear redemption period provided the purchaser files an indemnity bond. That bond, nonetheless, is not required after the purchaser has consolidated his title to the property following the

mortgagor's failure to exercise his right of redemption for in such a case, the former has become the absolute owner thereof.24 It, thus, clearly follows from the foregoing that, during the period of redemption, the mortgagor, being still the owner of the foreclosed property, remains entitled to the physical possession thereof subject to the purchaser's right to petition the court to give him possession and to file a bond pursuant to the provisions of Section 7 of Act No. 3135, as amended. The mere purchase and certificate of sale alone do not confer any right to the possession or beneficial use of the premises.25 In the instant case, there is neither evidence nor allegation that respondent, as purchaser of the disputed property, filed a petition and bond in accordance with the provisions of Section 7 of Act No. 3135. In addition, respondent defaulted in the payment of her rents. Thus, absent respondent's filing of such petition and bond prior to the expiration of the period of redemption, coupled with her failure to pay her rent, she did not have the right to possess the subject property. On the other hand, petitioner, as mortgagor and owner, was entitled not only to the possession of the disputed house and lot but also to the rents, earnings and income derived therefrom. In this regard, the RTC correctly cited Section 32, Rule 39 of the Rules of Court which provides as follows: Sec. 32. Rents, earnings and income of property pending redemption. The purchaser or a redemptioner shall not be entitled to receive the rents, earnings and income of the property sold on execution, or the value of the use and occupation thereof when such property is in the possession of a tenant. All rents, earnings and income derived from the property pending redemption shall belong to the judgment obligor until the expiration of his period of redemption. (Emphasis supplied) While the above rule refers to execution sales, the Court finds no cogent reason not to apply the same principle to a foreclosure sale, as in this case. The situation became different, however, after the expiration of the redemption period on February 23, 2001. Since there is no allegation, much less evidence, that petitioner redeemed the subject property within one year from the date of registration of the certificate of sale, respondent became the owner thereof. Consolidation of title becomes a right upon the expiration of the redemption period.26 Having become the owner of the disputed property, respondent is then entitled to its possession. As a consequence, petitioner's ejectment suit filed against respondent was rendered moot when the period of redemption expired on February 23, 2001 without petitioner having redeemed the subject property, for upon expiration of such period petitioner lost his possessory right over the same. Hence, the only remaining right that petitioner can enforce is his right to the rentals during the time that he was still entitled to physical possession of the subject property that is from May 2000 until February 23, 2001.1wphi1

In this regard, this Court agrees with the findings of the MTCC that, based on the evidence and the pleadings filed by petitioner, respondent is liable for payment of rentals beginning May 2000 until February 2001, or for a period of ten (10) months. However, it is not disputed that respondent already gave to petitioner the sum of P27,000.00, which is equivalent to two (2) months rental, as deposit to cover for any unpaid rentals. It is only proper to deduct this amount from the rentals due to petitioner, thus leaving P108,000.00 unpaid rentals. As to attorneys fees and litigation expenses, the Court agrees with the RTC that since petitioner is, in entitled to unpaid rentals, her complaint which, among others, prays for the payment of unpaid rentals, is justified. Thus, the award of attorney' and litigation expenses to respondent should be deleted. WHEREFORE, the Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 77617, dated September 8, 2004 and August 16, 2006, respectively, are AFFIRMED with the following MODIFICATIONS: (1) respondent is ORDERED to pay petitioner P108,000.00 as and for unpaid rentals; (2) the award of attorneys fees and litigation expenses to respondent is DELETED. SO ORDERED.

G.R. No. 183822 January 18, 2012 RUBEN C. CORPUZ, represented by Attorney-in-Fact Wenifreda C. Agullana, Petitioner, vs. Sps. HILARION AGUSTIN and JUSTA AGUSTIN, Respondents. SERENO, J.: This Petition for Review on Certiorari under Rule 45 of the Rules of Court assails the Decision1 dated 08 January 2008 of the Court of Appeals (CA) in CA-G.R. SP No. 90645, which affirmed the Decision of the Regional Trial Court (RTC) of Laoag City and its Resolution 2 dated 15 July 2008 denying the Motion for Reconsideration. The RTC, in the exercise of its appellate jurisdiction, affirmed the Decision of the Municipal Trial Court (MTC) of Laoag City, which had dismissed the unlawful detainer case filed by herein petitioner. The Factual Antecedents The Court adopts the findings of fact of the CA as follows:

10

Ruben C. Corpuz (Ruben) filed a complaint for ejectment against Spouses Hilarion and Justa Agustin on the allegation that he is the registered owner of two parcels of land located in Santa Joaquina, Laoag City covered by TCT No. 12980 issued on October 29, 1976 by the Laoag City Register of Deeds and with technical descriptions as follows: 1) A parcel of land (Lot No. 20 of the Cadastral Survey of Laoag), with improvements thereon, situated in the barrio of Santa Joaquina, Municipality of Laoag. Bounded x x x containing an area of five thousand seven hundred and fifty nine (5,759) square meters more or less x x x. 2) A parcel of land (Lot No. 11711 of the Cadastral Survey of Laoag), with the improvements thereon, situated in the barrio of Santa Joaquina, Municipality of Laoag. Bounded x x x, containing an area of twenty thousand seven hundred and forty five (20,745) square meters, more or less x x x. Aforesaid parcels of land were formerly owned by Elias Duldulao in whose name Original Certificate of Title No. O-1717 was issued. Duldulao sold said properties on August 27, 1951 to Francisco D. Corpuz, father of Ruben C. Corpuz. The elder Corpuz allowed spouses Agustin to occupy subject properties, the latter being relatives. Despite demand to vacate, the Agustins refused to leave the premises. Ruben alleged further that he has the better right to possess subject property having acquired the same from his father, Francisco, who executed a Deed of Quitclaim in his favor on March 15, 1971. Spouses Agustin, in their Answer, interposed the defense that on June 5, 1971 Francisco Corpuz, Ruben's father, disposed of subject property by executing a Deed of Absolute Sale in their favor for a consideration of Eleven Thousand One Hundred Fifty Pesos (P11,150.00). The Municipal Trial Court found for the spouses Agustin and dismissed the complaint. In sum, considering the evidence of the defendants which shows that they entered into and occupied Lot No. 20 and the 9,657 sq. m. portion of Lot No. 11711 as buyers or owners, disproving the allegation of the plaintiff that defendants were merely allowed by Francisco Corpuz to occupy the subject properties, being his relatives, and considering further the length of time that the defendants have been in possession, as owners, of Lot No. 20 and the 9,657 sq. m. portion of Lot No. 11711, and have been continuously exercising their rights of ownership thereon, this court is of the view and holds, in so far as this case is concerned, that the defendants are the ones entitled to the possession of Lot No. 20 and the 9,657 sq. m. portion of Lot No. 11711. WHEREFORE, premises considered, this case, is hereby dismissed. SO ORDERED.

On appeal, Branch XVI, Regional Trial Court of Laoag City affirmed said dismissal, the dispositive portion of said decision states: "WHEREFORE, premises considered, the Appeal is hereby DISMISSED for lack of merit and the JUDGMENT of the Municipal Trial Court in Cities, Branch 01, Laoag City is hereby AFFIRMED, with costs against the plaintiff-appellant. SO ORDERED.3 Petitioner assailed the Decision of the RTC, affirming the earlier dismissal of the case by the MTC, by instituting an appeal with the CA. On 08 January 2008, the appellate court through its Fourteenth Division dismissed his appeal.4 It noted that his father engaged in a double sale when he conveyed the disputed properties to petitioner and respondents. The Quitclaim executed by the elder Corpuz in favor of petitioner was dated 15 March 1971, while the Deed of Sale with respondents was later, on 15 June 1971; both documents were notarized shortly after their execution.5 The Quitclaim, which was subsequently inscribed at the back of Original Certificate of Title (OCT) No. O-1717 on 29 October 1976,6 resulted in the issuance of Transfer Certificate of Title (TCT) No. T-12980 in the name of petitioner. The Deed of Sale executed with respondents was, however, not annotated at the back of OCT No. O-1717 and remained unregistered. 7 Based on the above findings, the CA ruled that petitioner had knowledge of the sale of the disputed real property executed between Francisco Corpuz, petitioner's father, and respondents. Due to this conveyance by the elder Corpuz to respondents, the latter's possession thereof was in the nature of ownership. Thus, in the context of an unlawful detainer case instituted by petitioner against respondents, the appellate court concluded that respondents possession of the property was not by mere tolerance of its former owner petitioner's father but was in the exercise of ownership.8 The CA noted that petitioner had knowledge of his fathers sale of the properties to respondents as early as 1973. However, despite knowledge of the sale, petitioner failed to initiate any action to annul it and oust respondents from the subject properties. 9 The appellate court rejected his contention that, as registered owner of the disputed properties, he had a better right to possession thereof, compared to the unregistered Deed of Sale relied upon by respondents in their defense of the same properties. The CA ruled that the inaction on his part despite knowledge of the sale in 1973 was equivalent to registration of respondents unregistered deed. 10 In dismissing his appeal, the CA concluded that respondents possession was "not ... anchored on mere tolerance nor on any of the grounds for forcible entry or unlawful detainer"; hence "the complaint for ejectment must fail."11 The dispositive portion of the assailed Decision reads: WHEREFORE, in view of the foregoing, the instant petition is hereby DISMISSED. The decision of Branch XVI, Regional Trial Court of Laoag City in Civil Case No. 13293-16 is hereby AFFIRMED. SO ORDERED.12

11

The Issues Petitioner assigns the following errors in this Petition for Review on Certiorari: I. THE HONORABLE COURT of appeals seriously erred in failing to consider the legal ownership of petitioner on the disputed property to claim better right to possession. II. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN THE APPRECIATION OF THE ALLEGED SALE IN FAVOR OF RESPONDENTS TO RULE THAT THEY HAVE BETTER RIGHT TO POSSESSION. III. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN FAILING TO CONSIDER THE CASE OF JACINTO CO VS. MILITAR, ET AL. (421 SCRA 455) WHICH IS SIMILAR TO THE INSTANT CASE. IV. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN DENYING THE PETITION FOR REVIEW RAISED BEFORE IT.13 Petitioner presents to this Court for resolution the core issue of his Petition: who between the parties has the right to possession of the disputed properties -- petitioner, who is the registered owner under TCT No. T-12980; or respondents, who have a notarized yet unregistered Deed of Absolute Sale over the same properties? The Court's Ruling We DENY the Petition. Although this case does not present a novel question of law, there is a need to discuss the nature of an ejectment case for the recovery of physical possession in relation to the Torrens system. A resolution of the issue would be relevant to the determination of who has the better right to possession in this unlawful detainer case. One of the three kinds of action for the recovery of possession of real property is " 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 the recovery of physical possession where the dispossession has not lasted for more than one year, and should be brought in the proper inferior court."14 In ejectment proceedings, the courts resolve the basic question of who is entitled to physical possession of the premises, possession referring to possession de facto, and not possession de jure.15 Where the parties to an ejectment case raise the issue of ownership, the courts may pass upon that issue to determine who between the parties has the better right to possess the property. However, where the issue of ownership is inseparably linked to that of possession, adjudication of the ownership issue is not final and binding, but only for the purpose of resolving the issue of

possession. The adjudication of the issue of ownership is only provisional, and not a bar to an action between the same parties involving title to the property. 16 In the instant case, the position of respondents is that they are occupying the disputed properties as owners, having acquired these from petitioner's father through a Deed of Absolute Sale executed in 1971. Respondents believe that they cannot be dispossessed of the disputed properties, since they are the owners and are in actual possession thereof up to this date. Petitioner, however, rebuts this claim of ownership, contending that he has registered the disputed properties in his name and has been issued a land title under the Torrens system. He asserts that, having registered the properties in his name, he is the recognized owner and consequently has the better right to possession. Indeed, a title issued under the Torrens system is entitled to all the attributes of property ownership, which necessarily includes possession.17 Petitioner is correct that as a Torrens title holder over the subject properties, he is the rightful owner and is entitled to possession thereof. However, the lower courts and the appellate court consistently found that possession of the disputed properties by respondents was in the nature of ownership, and not by mere tolerance of the elder Corpuz. In fact, they have been in continuous, open and notorious possession of the property for more than 30 years up to this day. Petitioner cites Jacinto Co v. Rizal Militar, et al.,18 which has facts and legal issues identical to those of the instant case. The petitioner therein filed an unlawful detainer case against the respondents over a disputed property. He had a Torrens title thereto, while the respondents as actual occupants of the property claimed ownership thereof based on their unregistered Deeds of Sale. The principal issue was who between the two parties had the better right to possess the subject property. This Court resolved the issue by upholding the title holder as the one who had the better right to possession of the disputed property based on the following justification: We have, time and again, held that the only issue for resolution in an unlawful detainer case is physical or material possession of the property involved, independent of any claim of ownership by any of the party litigants. Moreover, an ejectment suit is summary in nature and is not susceptible to circumvention by the simple expedient of asserting ownership over the property. In forcible entry and unlawful detainer cases, even if 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 lower courts and the Court of Appeals, nonetheless, have the undoubted competence to provisionally resolve the issue of ownership for the sole purpose of determining the issue of Possession. Such decision, however, does not bind the title or affect the ownership of the land nor is conclusive of the facts therein found in a case between the same parties upon a different cause of action involving possession.

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In the instant case, the evidence showed that as between the parties, it is the petitioner who has a Torrens Title to the property. Respondents merely showed their unregistered deeds of sale in support of their claims. The Metropolitan Trial Court correctly relied on the transfer certificate of title in the name of petitioner. In Tenio-Obsequio v. Court of Appeals, it was held that the Torrens System was adopted in this country because it was believed to be the most effective measure to guarantee the integrity of land titles and to protect their indefeasibility once the claim of ownership is established and recognized. It is settled that a Torrens Certificate of title is indefeasible and binding upon the whole world unless and until it has been nullified by a court of competent jurisdiction. Under existing statutory and decisional law, the power to pass upon the validity of such certificate of title at the first instance properly belongs to the Regional Trial Courts in a direct proceeding for cancellation of title. As the registered owner, petitioner had a right to the possession of the property, which is one of the attributes of his ownership. Respondents' argument that petitioner is not an innocent purchaser for value and was guilty of bad faith in having the subject land registered in his name is a collateral attack on the title of petitioner, which is not allowed. A certificate of title cannot be subject to a collateral attack and can be altered, modified or cancelled only in a direct proceeding in accordance with law. 19 The pronouncement in Co v. Militar was later reiterated in Spouses Pascual v. Spouses Coronel20 and in Spouses Barias v. Heirs of Bartolome Boneo, et al., 21 wherein we consistently held the age-old rule "that the person who has a Torrens Title over a land is entitled to possession thereof."22 However, we cannot lose sight of the fact that the present petitioner has instituted an unlawful detainer case against respondents. It is an established fact that for more than three decades, the latter have been in continuous possession of the subject property, which, as such, is in the concept of ownership and not by mere tolerance of petitioners father. Under these circumstances, petitioner cannot simply oust respondents from possession through the summary procedure of an ejectment proceeding. Instructive on this matter is Carbonilla v. Abiera,23 which reads thus: Without a doubt, the registered owner of real property is entitled to its possession. However, the owner cannot simply wrest possession thereof from whoever is in actual occupation of the property. To recover possession, he must resort to the proper judicial remedy and, once he chooses what action to file, he is required to satisfy the conditions necessary for such action to prosper. In the present case, petitioner opted to file an ejectment case against respondents. Ejectment casesforcible entry and unlawful detainerare summary proceedings designed to provide

expeditious means to protect actual possession or the right to possession of the property involved. The only question that the courts resolve in ejectment proceedings is: who is entitled to the physical possession of the premises, that is, to the possession de facto and not to the possession de jure. It does not even matter if a partys title to the property is questionable. For this reason, an ejectment case will not necessarily be decided in favor of one who has presented proof of ownership of the subject property. Key jurisdictional facts constitutive of the particular ejectment case filed must be averred in the complaint and sufficiently proven. The statements in the complaint that respondents possession of the building was by mere tolerance of petitioner clearly make out a case for unlawful detainer. Unlawful detainer involves the persons withholding from another of the possession of the real property to which the latter is entitled, after the expiration or termination of the formers right to hold possession under the contract, either expressed or implied. A requisite for a valid cause of action in an unlawful detainer case is that possession must be originally lawful, and such possession must have turned unlawful only upon the expiration of the right to possess. It must be shown that the possession was initially lawful; hence, the basis of such lawful possession must be established. If, as in this case, the claim is that such possession is by mere tolerance of the plaintiff, the acts of tolerance must be proved. (Emphasis supplied.) In this case, petitioner has not proven that respondents continued possession of the subject properties was by mere tolerance of his father, except by a mere allegation thereof. In fact, petitioner has not established when respondents possession of the properties became unlawful a requisite for a valid cause of action in an unlawful detainer case. In Canlas v. Tubil,24 we enumerated the elements that constitute the sufficiency of a complaint for unlawful detainer, as follows: Well-settled is the rule that what determines the nature of the action as well as the court which has jurisdiction over the case are the allegations in the complaint. In ejectment cases, the complaint should embody such statement of facts as to bring the party clearly within the class of cases for which the statutes provide a remedy, as these proceedings are summary in nature. The complaint must show enough on its face to give the court jurisdiction without resort to parol evidence. Unlawful detainer is an action to recover possession of real property from one who illegally withholds possession after the expiration or termination of his right to hold possession under any contract, express or implied. The possession of the defendant in unlawful detainer is originally legal but became illegal due to the expiration or termination of the right to possess. An unlawful detainer proceeding is summary in nature, jurisdiction of which lies in the proper municipal trial court or metropolitan trial court. The action must be brought within one year from the date of last demand and the issue in said case is the right to physical possession. ... ... ...

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In Cabrera v. Getaruela, the Court held that a complaint sufficiently alleges a cause of action for unlawful detainer if it recites the following: (1) initially, possession of property by the defendant was by contract with or by tolerance of the plaintiff; (2) eventually, such possession became illegal upon notice by plaintiff to defendant of the termination of the latters right of possession; (3) thereafter, the defendant remained in possession of the property and deprived the plaintiff of the enjoyment thereof; and (4) within one year from the last demand on defendant to vacate the property, the plaintiff instituted the complaint for ejectment. Based on the above, it is obvious that petitioner has not complied with the requirements sufficient to warrant the success of his unlawful detainer Complaint against respondents. The lower courts and the CA have consistently upheld the entitlement of respondents to continued possession of the subject properties, since their possession has been established as one in the concept of ownership. Thus, the courts correctly dismissed the unlawful detainer case of petitioner. We concur in the appellate courts findings that petitioners father engaged in a double sale of the disputed properties. The records of the case show that it took petitioner more or less five years from 1971 when he acquired the property from his father to 1976 when petitioner registered the conveyance and caused the issuance of the land title registered in his name under the Torrens system. Respondents, on the other hand, continued their possession of the properties, but without bothering to register them or to initiate any action to fortify their ownership. We cannot, however, sustain the appellate courts conclusion that petitioner's failure to initiate any action to annul the sale to respondents and oust them from the disputed properties had the effect of registration of respondents unregistered Deed of Absolute Sale. We held thus in Ruiz, Sr. v. Court of Appeals 25: (But) where a party has knowledge of a prior existing interest which is unregistered at that time he acquired a right to the same land, his knowledge of that prior unregistered interest has the effect of registration as to him. Knowledge of an unregistered sale is equivalent to registration. As held in Fernandez v. Court of Appeals [189 SCRA 780 (1990)], Section 50 of Act No. 496 (now Sec. 51 of P.D. 1529), provides that the registration of the deed is the operative act to bind or affect the land insofar as third persons are concerned. But where the party has knowledge of a prior existing interest which is unregistered at the time he acquired a right to the same land, his knowledge of that prior unregistered interest has the effect of registration as to him. The Torrens system cannot be used as a shield for the commission of fraud (Gustillo v. Maravilla, 48 Phil. 442). [Emphasis supplied.]

In this case, the Quitclaim executed by the elder Corpuz in favor of petitioner was executed ahead of the Deed of Sale of respondents. Thus, the sale of the subject properties by petitioners father to respondents cannot be considered as a prior interest at the time that petitioner came to know of the transaction. We also note that, based on the records, respondents do not dispute the existence of TCT No. T12980 registered in the name of petitioner. They allege, though, that the land title issued to him was an "act of fraud" 26on his part. We find this argument to be equivalent to a collateral attack against the Torrens title of petitioner an attack we cannot allow in the instant unlawful detainer case.1wphi1 It is settled in jurisprudence that a Torrens certificate of title cannot be the subject of collateral attack.27 Such attack must be direct and not by a collateral proceeding. 28 It is a well-established doctrine that the title represented by the certificate cannot be changed, altered, modified, enlarged, or diminished in a collateral proceeding.29 Considering that this is an unlawful detainer case wherein the sole issue to be decided is possession de facto rather than possession de jure, a collateral attack by herein respondents on petitioner's title is proscribed. Our ruling in the present case is only to resolve the issue of who has the better right to possession in relation to the issue of disputed ownership of the subject properties. Questions as to the validity of petitioner's Torrens title can be ventilated in a proper suit instituted to directly attack its validity, an issue that we cannot resolve definitively in this unlawful detainer case. WHEREFORE, in view of the foregoing, we deny the instant Petition for lack of merit. 1wphi1 The Decisions of the Court of Appeals in CA-G.R. SP No. 90645 (dated January 08, 2008), of the Regional Trial Court of Laoag City in Civil Case No. 3111-13293-65, as well as of the Municipal Trial Court of Laoag City in Civil Case No. 3111 -- all dismissing the unlawful detainer case of petitioner are AFFIRMED. We make no pronouncements as to attorney's fees for lack of evidence. SO ORDERED.

G.R. No. 190071 August 15, 2012 UNION BANK OF THE PHILIPPINES, Petitioner, vs. MAUNLAD HOMES, INC. and all other persons or entities claiming rights under it, Respondents. BRION, J.: Before the Court is the petition for review on certiorari1 under Rule 45 of the Rules of Court filed by petitioner Union Bank of the Philippines (Union Bank), assailing the decision dated October 28, 20092 of the Court of Appeals (CA) in CA-G.R. SP No. 107772. THE FACTS

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Union Bank is the owner of a commercial complex located in Malolos, Bulacan, known as the Maunlad Shopping Mall. Sometime in August 2002, Union Bank, as seller, and respondent Maunlad Homes, Inc. ( Maunlad Homes), as buyer, entered into a contract to sell3 involving the Maunlad Shopping Mall. The contract set the purchase price atP151 million, P2.4 million of which was to be paid by Maunlad Homes as down payment payable on or before July 5, 2002, with the balance to be amortized over the succeeding 180-month period.4 Under the contract, Union Bank authorized Maunlad Homes to take possession of the property and to build or introduce improvements thereon. The parties also agreed that if Maunlad Homes violates any of the provisions of the contract, all payments made will be applied as rentals for the use and possession of the property, and all improvements introduced on the land will accrue in favor of Union Bank. 5 In the event of rescission due to failure to pay or to comply with the terms of the contract, Maunlad Homes will be required to immediately vacate the property and must voluntarily turn possession over to Union Bank. 6 When Maunlad Homes failed to pay the monthly amortization, Union Bank sent the former a Notice of Rescission of Contract7 dated February 5, 2003, demanding payment of the installments due within 30 days from receipt; otherwise, it shall consider the contract automatically rescinded. Maunlad Homes failed to comply. Hence, on November 19, 2003, Union Bank sent Maunlad Homes a letter demanding payment of the rentals due and requiring that the subject property be vacated and its possession turned over to the bank. When Maunlad Homes continued to refuse, Union Bank instituted an ejectment suit before the Metropolitan Trial Court ( MeTC) of Makati City, Branch 64, on February 19, 2004. Maunlad Homes resisted the suit by claiming, among others, that it is the owner of the property as Union Bank did not reserve ownership of the property under the terms of the contract.8By virtue of its ownership, Maunlad Homes claimed that it has the right to possess the property. On May 18, 2005, the MeTC dismissed Union Banks ejectment complaint. It found that Union Banks cause of action was based on a breach of contract and that both parties are claiming a better right to possess the property based on their respective claims of ownership of the property. The MeTC ruled that the appropriate action to resolve these conflicting claims was an accion reivindicatoria, over which it had no jurisdiction. On appeal, the Regional Trial Court (RTC) of Makati City, Branch 139, affirmed the MeTC in its decision dated July 17, 2008;10 it agreed with the MeTC that the issues raised in the complaint extend beyond those commonly involved in an unlawful detainer suit. The RTC declared that the case involved a determination of the rights of the parties under the contract. Additionally, the RTC noted that the property is located in Malolos, Bulacan, but the ejectment suit was filed by Union Bank in Makati City, based on the contract stipulation that "the venue of all suits and actions arising out or in connection with the Contract to Sell shall be in Makati City." 11 The RTC ruled that the proper venue for the ejectment action is in Malolos, Bulacan, pursuant to the second paragraph of Section 1, Rule 4 of the Rules of Court, which states:
9

Section 1. Venue of real actions. - Actions affecting title to or possession of real property, or interest therein, shall be commenced and tried in the proper court which has jurisdiction over the area wherein the real property involved, or a portion thereof, is situated. Forcible entry and detainer actions shall be commenced and tried in the municipal trial court of the municipality or city wherein the real property involved, or a portion thereof, is situated. [emphasis ours] The RTC declared that Union Bank cannot rely on the waiver of venue provision in the contract because ejectment is not an action arising out of or connected with the contract. Union Bank appealed the RTC decision to the CA through a petition for review under Rule 42 of the Rules of Court. The CA affirmed the RTC decision in its October 28, 2009 decision, 12 ruling that Union Banks claim of possession is based on its claim of ownership which in turn is based on its interpretation of the terms and conditions of the contract, particularly, the provision on the consequences of Maunlad Homes breach of contract. The CA determined that Union Banks cause of action is premised on the interpretation and enforcement of the contract and the determination of the validity of the rescission, both of which are matters beyond the jurisdiction of the MeTC. Therefore, it ruled that the dismissal of the ejectment suit was proper. The CA, however, made no further ruling on the issue of venue of the action. From the CAs judgment, Union Bank appealed to the Court by filing the present petition for review on certiorariunder Rule 45 of the Rules of Court. THE PARTIES ARGUMENTS Union Bank disagreed with the CAs finding that it is claiming ownership over the property through the ejectment action. It claimed that it never lost ownership over the property despite the execution of the contract, since only the right to possess was conceded to Maunlad Homes under the contract; Union Bank never transferred ownership of the property to Maunlad Homes. Because of Maunlad Homes failure to comply with the terms of the contract, Union Bank believes that it rightfully rescinded the sale, which rescission terminated Maunlad Homes right to possess the subject property. Since Maunlad Homes failed to turn over the possession of the subject property, Union Bank believes that it correctly instituted the ejectment suit. The Court initially denied Union Banks petition in its Resolution dated March 17, 2010. 13 Upon motion for reconsideration filed by Union Bank, the Court set aside its Resolution of March 17, 2010 (in a Resolution dated May 30, 201114) and required Maunlad Homes to comment on the petition. Maunlad Homes contested Union Banks arguments, invoking the rulings of the lower courts. It considered Union Banks action as based on the propriety of the rescission of the contract, which, in turn, is based on a determination of whether Maunlad Homes indeed failed to comply with the terms of the contract; the propriety of the rescission, however, is a question that is within the

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RTCs jurisdiction. Hence, Maunlad Homes contended that the dismissal of the ejectment action was proper. THE COURTS RULING We find the petition meritorious. The authority of the MeTC to interpret contracts in an unlawful detainer action In any case involving the question of jurisdiction, the Court is guided by the settled doctrine that the jurisdiction of a court is determined by the nature of the action pleaded by the litigant through the allegations in his complaint.15 Unlawful detainer is an action to recover possession of real property from one who unlawfully withholds possession after the expiration or termination of his right to hold possession under any contract, express or implied. The possession of the defendant in unlawful detainer is originally legal but became illegal due to expiration or termination of the right to possess. 16 Under Section 1, Rule 70 of the Rules of Court, the action must be filed "within one (1) year after the unlawful deprivation or withholding of possession." Thus, to fall within the jurisdiction of the MeTC, the complaint must allege that 1. the defendant originally had lawful possession of the property, either by virtue of a contract or by tolerance of the plaintiff; 2. eventually, the defendants possession of the property becameillegal or unlawful upon notice by the plaintiff to defendant of the expiration or the termination of the defendants right of possession; 3. thereafter, the defendant remained in possession of the property and deprived the plaintiff the enjoyment thereof; and 4. within one year from the unlawful deprivation or withholding of possession, the plaintiff instituted the complaint for ejectment. 17 Contrary to the findings of the lower courts, all four requirements were alleged in Union Banks Complaint. Union Bank alleged that Maunlad Homes "maintained possession of the subject properties" pursuant to the Contract to Sell.18 Maunlad Homes, however, "failed to faithfully comply with the terms of payment," prompting Union Bank to "rescind the Contract to Sell in a Notice of Rescission dated February 5, 2003."19 When Maunlad Homes "refused to turn over and vacate the subject premises,"20 Union Bank sent another Demand Letter on November 19, 2003 to Maunlad Homes requiring it (1) "to pay the equivalent rentals-in-arrears as of October 2003 in the amount ofP15,554,777.01 and monthly thereafter until the premises are fully vacated and turned over" to Union Bank, and (2) to vacate the property peacefully and turn over possession to Union

Bank.21 As the demand went unheeded, Union Bank instituted an action for unlawful detainer before the MeTC on February 19, 2004, within one year from the date of the last demand. These allegations clearly demonstrate a cause of action for unlawful detainer and vested the MeTC jurisdiction over Union Banks action. Maunlad Homes denied Union Banks claim that its possession of the property had become unlawful. It argued that its failure to make payments did not terminate its right to possess the property because it already acquired ownership when Union Bank failed to reserve ownership of the property under the contract. Despite Maunlad Homes claim of ownership of the property, the Court rules that the MeTC retained its jurisdiction over the action; a defendant may not divest the MeTC of its jurisdiction by merely claiming ownership of the property. 22 Under Section 16, Rule 70 of the Rules of Court, "when the defendant raises the defense 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." Section 18, Rule 70 of the Rules of Court, however, states that "the judgment x x x shall be conclusive with respect to the possession only and shall in no wise bind the title or affect the ownership of the land or building." The authority granted to the MeTC to preliminarily resolve the issue of ownership to determine the issue of possession ultimately allows it to interpret and enforce the contract or agreement between the plaintiff and the defendant. To deny the MeTC jurisdiction over a complaint merely because the issue of possession requires the interpretation of a contract will effectively rule out unlawful detainer as a remedy. As stated, in an action for unlawful detainer, the defendants right to possess the property may be by virtue of a contract, express or implied; corollarily, the termination of the defendants right to possess would be governed by the terms of the same contract. Interpretation of the contract between the plaintiff and the defendant is inevitable because it is the contract that initially granted the defendant the right to possess the property; it is this same contract that the plaintiff subsequently claims was violated or extinguished, terminating the defendants right to possess. We ruled in Sps. Refugia v. CA23 that 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. The MeTCs ruling on the rights of the parties based on its interpretation of their contract is, of course, not conclusive, but is merely provisional and is binding only with respect to the issue of possession. Thus, despite the CAs opinion that Union Banks "case involves a determination of the rights of the parties under the Contract to Sell," 24 it is not precluded from resolving this issue. Having acquired jurisdiction over Union Banks action, the MeTC can resolve the conflicting claims of the parties based on the facts presented and proved. The right to possess the property was extinguished when the contract to sell failed to materialize

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Maunlad Homes acquired possession of the property based on its contract with Union Bank. While admitting that it suspended payment of the installments, 25 Maunlad Homes contended that the suspension of payment did not affect its right to possess the property because its contract with Union Bank was one of sale and not to sell; hence, ownership of the property has been transferred to it, allowing it to retain possession notwithstanding nonpayment of installments. The terms of the contract, however, do not support this conclusion. Section 11 of the contract between Union Bank and Maunlad Homes provides that "upon payment in full of the Purchase Price of the Property x x x, the SELLER shall execute and deliver a Deed of Absolute Sale conveying the Property to the BUYER." 26 "Jurisprudence has established that where the seller promises to execute a deed of absolute sale upon the completion by the buyer of the payment of the price, the contract is only a contract to sell." 27 The presence of this provision generally identifies the contract as being a mere contract to sell. 28 After reviewing the terms of the contract between Union Bank and Maunlad Homes, we find no reasonable ground to exempt the present case from the general rule; the contract between Union Bank and Maunlad Homes is a contract to sell.1wphi1 In a contract to sell, the full payment of the purchase price is a positive suspensive condition whose non-fulfillment is not a breach of contract, but merely an event that prevents the seller from conveying title to the purchaser. "The non-payment of the purchase price renders the contract to sell ineffective and without force and effect."29Maunlad Homes act of withholding the installment payments rendered the contract ineffective and without force and effect, and ultimately deprived itself of the right to continue possessing Maunlad Shopping Mall. The propriety of filing the unlawful detainer action in Makati City pursuant to the venue stipulation in the contract Maunlad Homes questioned the venue of Union Banks unlawful detainer action which was filed in Makati City while the contested property is located in Malolos, Bulacan. Citing Section 1, Rule 4 of the Rules of Court, Maunlad Homes claimed that the unlawful detainer action should have been filed with the municipal trial court of the municipality or city where the real property involved is situated. Union Bank, on the other hand, justified the filing of the complaint with the MeTC of Makati City on the venue stipulation in the contract which states that "the venue of all suits and actions arising out of or in connection with this Contract to Sell shall be at Makati City." 30 While Section 1, Rule 4 of the Rules of Court states that ejectment actions shall be filed in "the municipal trial court of the municipality or city wherein the real property involved x x x is situated," Section 4 of the same Rule provides that the rule shall not apply "where the parties have validly agreed in writing before the filing of the action on the exclusive venue thereof." Precisely, in this case, the parties provided for a different venue. In Villanueva v. Judge Mosqueda, etc., et al.,31 the Court upheld the validity of a stipulation in a contract providing for a venue for ejectment actions other than that stated in the Rules of Court. Since the unlawful detainer action is connected with the contract, Union Bank rightfully filed the complaint with the MeTC of Makati City. 1wphi1

WHEREFORE, we hereby GRANT the petition and SET ASIDE the decision dated October 28, 2009 of the Court of Appeals in CA-G.R. SP No. 107772. Respondent Maunlad Homes, Inc. is ORDERED TO VACATE the Maunlad Shopping Mall, the property subject of the case, immediately upon the finality of this Decision. Respondent Maunlad Homes, Inc. is further ORDERED TO PAY the rentals-in-arrears, as well as rentals accruing in the interim until it vacates the property. The case is REMANDED to the Metropolitan Trial Court of Makati City, Branch 64, to determine the amount of rentals due. In addition to the amount determined as unpaid rent, respondent Maunlad Homes, Inc. is ORDERED TO PAY legal interest of six percent (6o/o) per annum, from November 19, 2003, when the demand to pay and to vacate was made, up to the finality of this Decision. Thereafter, an interest of twelve percent ( 12%) per annum shall be imposed on the total amount due until full payment is made. SO ORDERED.

G.R. No. 170509 June 27, 2012 VIEGELY SAMELO, represented by Attorney-in-Fact CRISTINA SAMELO, Petitioner, vs. MANOTOK SERVICES, INC., allegedly represented by PERPETUA BOCANEGRA (deceased), Respondent. BRION, J.: Before us is the petition for review on certiorari1 filed by Viegely Samelo (petitioner), represented by her attorney-in-fact Cristina Samelo, to challenge the decision dated June 21, 2005 2 and the resolution dated November 10, 20053 of the Court of Appeals (CA) in CA-G.R. SP No. 85664. Background Facts Manotok Services, Inc. (respondent) alleged that it is the administrator of a parcel of land known as Lot 9-A, Block 2913, situated at 2882 Dagupan Extension, Tondo, Manila. On January 31, 1997, the respondent entered into a contract with the petitioner for the lease of a portion of Lot 9A, Block 2913, described as Lot 4, Block 15 (subject premises). The lease contract was for a period of one (1) year, with a monthly rental of P3,960.00. After the expiration of the lease contract on December 31, 1997, the petitioner continued occupying the subject premises without paying the rent.4 On August 5, 1998, the respondent, thru its President Rosa Manotok, sent a letter to the petitioner demanding that she vacate the subject premises and pay compensation for its use and occupancy.5The petitioner, however, refused to heed these demands. On November 18, 1998, the respondent filed a complaint for unlawful detainer against the petitioner before the Metropolitan Trial Court (MeTC), Branch 3, Manila. 6 The case was docketed as Civil Case No. 161588-CV. The respondent prayed, among others, that the petitioner and those claiming rights under her be ordered to vacate the subject premises, and to pay compensation for its use and occupancy.

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In her answer, the petitioner alleged that the respondent had no right to collect rentals because the subject premises are located inside the property of the Philippine National Railways (PNR). She also added that the respondent had no certificate of title over the subject premises. The petitioner further claimed that her signature in the contract of lease was obtained through the respondents misrepresentation. She likewise maintained that she is now the owner of the subject premises as she had been in possession since 1944.7 The MeTC Ruling The MeTC, in its judgment8 of March 28, 2002, decided in favor of the respondent, and ordered the petitioner to vacate the subject premises and to deliver their peaceful possession to the respondent. The MeTC held that the only issue to be resolved in an unlawful detainer case is physical possession or possession de facto, and that the respondent had established its right of possession over the subject premises. It added that the petitioners right under the lease contract already ceased upon the expiration of the said contract. It further ruled that the petitioner is already estopped from questioning the right of the respondent over the subject premises when she entered into a contract of lease with the respondent. The dispositive portion of the MeTC judgment reads: WHEREFORE, premises considered, judgment is hereby rendered for the plaintiff and against defendant, ordering the latter and all persons claiming rights under her: 1. To vacate the premises located at 2882 Dagupan Extension, Tondo, Manila, and deliver the peaceful possession thereof to the plaintiff[;] 2. To pay plaintiff the sum of P40,075.20 as compensation for the use and occupancy of the premises from January 1, 1998 to August 30, 1998, plus P4,554.00 a month starting September 1, 1998, until defendant and all person[s] claiming rights under her to finally vacate the premises[;] 3. To pay plaintiff the sum of P5,000.00 for and as attorneys fees; and 4. To pay the cost of suit.9 The RTC Decision The petitioner filed an appeal10 with the Regional Trial Court (RTC), Branch 50, Manila. The RTC, in its decision11of July 1, 2004, set aside the MeTCs decision, and dismissed the complaint for unlawful detainer. The RTC held, among others, that the respondent had no right to collect rentals as it failed to show that it had authority to administer the subject premises and to enter into a contract of lease with the petitioner. It also ruled that the subject premises, which were formerly owned by the PNR, are now owned by the petitioner by virtue of her possession and stay in the premises since 1944. The CA Decision

Aggrieved by the reversal, the respondent filed a petition for review with the CA, docketed as CAG.R. SP No. 85664.12 The CA, in its decision of June 21, 2005, reversed and set aside the RTC decision, and reinstated the MeTC judgment. The CA held that the petitioner is now estopped from questioning the right of the respondent over the subject property. It explained that in an action involving the possession of the subject premises, a tenant cannot controvert the title of his landlord or assert any rights adverse to that title, without first delivering to the landlord the premises acquired by virtue of the agreement between themselves. The appellate court added that the petitioner cannot claim that she repudiated the lease contract, in the absence of any unequivocal acts of repudiation. The CA further held that the only issue in an ejectment suit is physical or material possession, although the trial courts may provisionally resolve the issue of ownership for the sole purpose of determining the issue of possession. It explained that the issue of ownership is not required to determine the issue of possession since the petitioner tacitly admitted that she is a lessee of the subject premises.13 The petitioner moved to reconsider this decision, but the CA denied her motion in its resolution dated November 10, 2005.14 In presenting her case before this Court, the petitioner argued that the CA erred in ruling that a tenant is not permitted to deny the title of his landlord. She maintained that the respondent is not the owner or administrator of the subject premises, and insisted that she had been in possession of the land in question since 1944. She further added that she repudiated the lease contract by filing a case for fraudulent misrepresentation, intimidation, annulment of lease contract, and quieting of title with injunction before another court. 15 The Courts Ruling We find the petition unmeritorious. Respondent has a better right of possession over the subject premises "An action for unlawful detainer exists when a person unlawfully withholds possession of any land or building against or from a lessor, vendor, vendee or other persons, after the expiration or termination of the right to hold possession, by virtue of any contract, express or implied." 16 "The only issue to be resolved in an unlawful detainer case is physical or material possession of the property involved, independent of any claim of ownership by any of the parties involved." 17 "Thus, when the relationship of lessor and lessee is established in an unlawful detainer case, any attempt of the parties to inject the question of ownership into the case is futile, except insofar as it might throw light on the right of possession."18 In the present case, it is undisputed that the petitioner and the respondent entered into a contract of lease. We note in this regard that in her answer with affirmative defenses and counterclaim before the MeTC, the petitioner did not deny that she signed the lease contract (although she maintained that her signature was obtained through the respondents misrepresentations). Under

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the lease contract, the petitioner obligated herself to pay a monthly rental to the respondent in the amount of P3,960.00. The lease period was for one year, commencing on January 1, 1997 and expiring on December 31, 1997. It bears emphasis that the respondent did not give the petitioner a notice to vacate upon the expiration of the lease contract in December 1997 (the notice to vacate was sent only on August 5, 1998), and the latter continued enjoying the subject premises for more than 15 days, without objection from the respondent. By the inaction of the respondent as lessor, there can be no inference that it intended to discontinue the lease contract. 19 An implied new lease was therefore created pursuant to Article 1670 of the Civil Code, which expressly provides: Article 1670. If at the end of the contract the lessee should continue enjoying the thing leased for fifteen days with the acquiescence of the lessor, and unless a notice to the contrary by either party has previously been given, it is understood that there is an implied new lease, not for the period of the original contract, but for the time established in Articles 1682 and 1687. The other terms of the original contract shall be revived. "An implied new lease or tacita reconduccion will set in when the following requisites are found to exist: a) the term of the original contract of lease has expired; b) the lessor has not given the lessee a notice to vacate; and c) the lessee continued enjoying the thing leased for fifteen days with the acquiescence of the lessor." 20 As earlier discussed, all these requisites have been fulfilled in the present case. Article 1687 of the Civil Code on implied new lease provides: Article 1687. If the period for the lease has not been fixed, it is understood to be from year to year, if the rent agreed upon is annual; from month to month, if it is monthly; from week to week, if the rent is weekly; and from day to day, if the rent is to be paid daily. Since the rent was paid on a monthly basis, the period of lease is considered to be from month to month, in accordance with Article 1687 of the Civil Code. "[A] lease from month to month is considered to be one with a definite period which expires at the end of each month upon a demand to vacate by the lessor."21 When the respondent sent a notice to vacate to the petitioner on August 5, 1998, the tacita reconduccion was aborted, and the contract is deemed to have expired at the end of that month. "[A] notice to vacate constitutes an express act on the part of the lessor that it no longer consents to the continued occupation by the lessee of its property." 22After such notice, the lessees right to continue in possession ceases and her possession becomes one of detainer.23 Estoppel of tenant We find no merit in the petitioners allegation that the respondent had no authority to lease the subject premises because the latter failed to prove that it is its owner or administrator. The Rules of Court protects the respondent, as lessor, from being questioned by the petitioner, as lessee, regarding its title or better right of possession over the subject premises. Section 2(b),

Rule 131 of the Rules of Court states that the tenant is not permitted to deny the title of his landlord at the time of the commencement of the relation of landlord and tenant between them. Article 1436 of the Civil Code likewise states that a lessee or a bailee is estopped from asserting title to the thing leased or received, as against the lessor or bailor. These provisions bar the petitioner from contesting the respondents title over the subject premises. "The juridical relationship between x x x [a] lessor and x x x [a lessee] carries with it a recognition of the lessor's title. As [lessee, the petitioner is] estopped [from denying the] landlord's title, or to assert a better title not only in [herself], but also in some third person while [she remains] in possession of the subject premises and until [she surrenders] possession to the landlord. This estoppel applies even though the lessor had no title at the time the relation of [the] lessor and [the] lessee was created, and may be asserted not only by the original lessor, but also by those who succeed to his title."24 Once a contact of lease is shown to exist between the parties, the lessee cannot by any proof, however strong, overturn the conclusive presumption that the lessor has a valid title to or a better right of possession to the subject premises than the lessee. The Court thus explained in Tamio v. Ticson:25 Indeed, the relation of lessor and lessee does not depend on the formers title but on the agreement between the parties, followed by the possession of the premises by the lessee under such agreement. As long as the latter remains in undisturbed possession, it is immaterial whether the lessor has a valid title or any title at all at the time the relationship was entered into. [citations omitted] The issue of ownership We are likewise unpersuaded by the petitioners claim that she has "acquired possessory rights leading to ownership"26 over the subject premises, having been in possession thereof since 1944. We emphasize that aside from her self-serving allegation, the petitioner did not present any documentary evidence to substantiate her claim that she stayed on the subject premises since 1944. That the petitioner presented certificates of title of the Manila Railroad Company over certain properties in Tondo, Manila, which allegedly cover the subject premises, is of no moment. One cannot recognize the right of another, and at the same time claim adverse possession which can ripen to ownership, thru acquisitive prescription. "For prescription to set in, the possession must be adverse, continuous, public, and to the exclusion of [others]." 27 Significantly, the RTC decision failed to state its basis for concluding that the petitioner stayed in the subject premises since 1944. At any rate, we hold that no need exists to resolve the issue of ownership in this case, since it is not required to determine the issue of possession; the execution of the lease contract between the petitioner, as lessee, and the respondent, as lessor, belies the formers claim of ownership.1wphi1 We reiterate that the fact of the lease and the expiration of its term are the only elements in an action for unlawful detainer. "The defense of ownership does not change the summary nature of [this] action. x x x. Although a wrongful possessor may at times be upheld by the courts, this is merely temporary and solely for the maintenance of public order. The question of ownership is to be settled in the proper court and in a proper action." 28

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Interest on rentals due Additionally, the petitioner is liable to pay interest by way of damages for her failure to pay the rentals due for the use of the subject premises.29 We reiterate that the respondents extrajudicial demand on the petitioner was made on August 5, 1998. Thus, from this date, the rentals due from the petitioner shall earn interest at 6% per annum, until the judgment in this case becomes final and executory. After the finality of judgment, and until full payment of the rentals and interests due, the legal rate of interest to be imposed shall be 12%. WHEREFORE, in light of all the foregoing, we DENY the petition. The decision and the resolution of the Court of Appeals dated June 21, 2005 and November 10, 2005, respectively, in CA-G.R. SP No. 85664 are AFFIRMED with the MODIFICATION that the unpaid rentals shall earn a corresponding interest of six percent (6%) per annum, to be computed from August 5, 1998 until the finality of this decision. After this decision becomes final and executory, the rate of legal interest shall be computed at twelve percent (12%) per annum from such finality until its satisfaction. SO ORDERED.

Lot 3 543 square meters in favor of Gervacio Ronquillo; and Lot 4 1,149 square meters in favor of the City Government of Lipa 2 As a result of subdivision, the Register of Deeds partially cancelled TCT T-11410 and issued new titles for Lots 1 and 3 in favor of Dimayuga and Ronquillo, respectively. Lot 2 remained in the name of the Mendozas but no new title was issued in the name of the City Government of Lipa for Lot 4.3 Meantime, PPS remained in possession of the property. The Republic claimed that, while no title was issued in the name of the City Government of Lipa, the Mendozas had relinquished to it their right over the school lot as evidenced by the consolidation and subdivision plan. Further, the property had long been tax-declared in the name of the City Government and PPS built significant, permanent improvements on the same. These improvements had also been tax-declared.4 The Mendozas claim, on the other hand, that although PPS sought permission from them to use the property as a school site, they never relinquished their right to it. They allowed PPS to occupy the property since they had no need for it at that time. Thus, it has remained registered in their name under the original title, TCT T-11410, which had only been partially cancelled. On November 6, 1998 the Mendozas wrote PPS, demanding that it vacate the disputed property.5 When PPS declined to do so, on January 12, 1999 the Mendozas filed a complaint with the Municipal Trial Court in Cities (MTCC) of Lipa City in Civil Case 0002-99 against PPS for unlawful detainer with application for temporary restraining order and writ of preliminary injunction.6 On July 13, 1999 the MTCC rendered a decision, dismissing the complaint on ground of the Republics immunity from suit.7 The Mendozas appealed to the Regional Trial Court (RTC) of Lipa City which ruled that the Republics consent was not necessary since the action before the MTCC was not against it.8 In light of the RTCs decision, the Mendozas filed with the MTCC a motion to render judgment in the case before it.9 The MTCC denied the motion, however, saying that jurisdiction over the case had passed to the RTC upon appeal.10 Later, the RTC remanded the case back to the MTCC,11 which then dismissed the case for insufficiency of evidence. 12 Consequently, the Mendozas once again appealed to the RTC in Civil Case 2001-0236. On June 27, 2006 the RTC found in favor of the Mendozas and ordered PPS to vacate the property. It held that the Mendozas had the better right of possession since they were its registered owners. PPS, on the other hand, could not produce any document to prove the transfer of ownership of the land in its favor.13 PPS moved for reconsideration, but the RTC denied it. The Republic, through the Office of the Solicitor General (OSG), appealed the RTC decision to the Court of Appeals (CA) in CA-G.R. SP 96604 on the grounds that: (1) the Mendozas were barred by laches from recovering possession of the school lot; (2) sufficient evidence showed that the

G.R. No. 185091 August 8, 2010 REPUBLIC OF THE PHILIPPINES, REPRESENTED BY THE DEPARTMENT OF EDUCATION DIVISION OF LIPA CITY (FOR PANINSINGIN PRIMARY SCHOOL), Petitioner, vs. PRIMO MENDOZA and MARIA LUCERO, Respondents. ABAD, J.: This case is about the propriety of filing an ejectment suit against the Government for its failure to acquire ownership of a privately owned property that it had long used as a school site and to pay just compensation for it. The Facts and the Case Paninsingin Primary School (PPS) is a public school operated by petitioner Republic of the Philippines (the Republic) through the Department of Education. PPS has been using 1,149 square meters of land in Lipa City, Batangas since 1957 for its school. But the property, a portion of Lots 1923 and 1925, were registered in the name of respondents Primo and Maria Mendoza (the Mendozas) under Transfer Certificate of Title (TCT) T-11410. 1 On March 27, 1962 the Mendozas caused Lots 1923 and 1925 to be consolidated and subdivided into four lots, as follows: Lot 1 292 square meters in favor of Claudia Dimayuga Lot 2 292 square meters in favor of the Mendozas

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Mendozas relinquished ownership of the subject lot to the City Government of Lipa City for use as school; and (3) Lot 4, Pcs-5019 has long been declared in the name of the City Government since 1957 for taxation purposes.14 In a decision dated February 26, 2008, the CA affirmed the RTC decision. 15 Upholding the Torrens system, it emphasized the indefeasibility of the Mendozas registered title and the imprescriptible nature of their right to eject any person occupying the property. The CA held that, this being the case, the Republics possession of the property through PPS should be deemed merely a tolerated one that could not ripen into ownership. The CA also rejected the Republics claim of ownership since it presented no documentary evidence to prove the transfer of the property in favor of the government. Moreover, even assuming that the Mendozas relinquished their right to the property in 1957 in the governments favor, the latter never took steps to have the title to the property issued in its name or have its right as owner annotated on the Mendozas title. The CA held that, by its omissions, the Republic may be held in estoppel to claim that the Mendozas were barred by laches from bringing its action. With the denial of its motion for reconsideration, the Republic has taken recourse to this Court via petition for review on certiorari under Rule 45. The Issue Presented The issue in this case is whether or not the CA erred in holding that the Mendozas were entitled to evict the Republic from the subject property that it had used for a public school. The Courts Ruling A decree of registration is conclusive upon all persons, including the Government of the Republic and all its branches, whether or not mentioned by name in the application for registration or its notice.16 Indeed, title to the land, once registered, is imprescriptible. 17 No one may acquire it from the registered owner by adverse, open, and notorious possession. 18 Thus, to a registered owner under the Torrens system, the right to recover possession of the registered property is equally imprescriptible since possession is a mere consequence of ownership. Here, the existence and genuineness of the Mendozas title over the property has not been disputed. While the consolidation and subdivision plan of Lots 1923 and 1925 shows that a 1,149 square meter lot had been designated to the City Government, the Republic itself admits that no new title was issued to it or to any of its subdivisions for the portion that PPS had been occupying since 1957.19 That the City Government of Lipa tax-declared the property and its improvements in its name cannot defeat the Mendozas title. This Court has allowed tax declarations to stand as proof of ownership only in the absence of a certificate of title. 20 Otherwise, they have little evidentiary weight as proof of ownership.21

The CA erred, however, in ordering the eviction of PPS from the property that it had held as government school site for more than 50 years. The evidence on record shows that the Mendozas intended to cede the property to the City Government of Lipa permanently. In fact, they allowed the city to declare the property in its name for tax purposes. And when they sought in 1962 to have the bigger lot subdivided into four, the Mendozas earmarked Lot 4, containing 1,149 square meters, for the City Government of Lipa. Under the circumstances, it may be assumed that the Mendozas agreed to transfer ownership of the land to the government, whether to the City Government of Lipa or to the Republic, way back but never got around to do so and the Republic itself altogether forgot about it. Consequently, the Republic should be deemed entitled to possession pending the Mendozas formal transfer of ownership to it upon payment of just compensation. The Court holds that, where the owner agrees voluntarily to the taking of his property by the government for public use, he thereby waives his right to the institution of a formal expropriation proceeding covering such property. Further, as the Court also held in Eusebio v. Luis, 22 the failure for a long time of the owner to question the lack of expropriation proceedings covering a property that the government had taken constitutes a waiver of his right to gain back possession. The Mendozas remedy is an action for the payment of just compensation, not ejectment. 1avvphi1 In Republic of the Philippines v. Court of Appeals,23 the Court affirmed the RTCs power to award just compensation even in the absence of a proper expropriation proceeding. It held that the RTC can determine just compensation based on the evidence presented before it in an ordinary civil action for recovery of possession of property or its value and damages. As to the time when just compensation should be fixed, it is settled that where property was taken without the benefit of expropriation proceedings and its owner filed an action for recovery of possession before the commencement of expropriation proceedings, it is the value of the property at the time of taking that is controlling.24 Since the MTCC did not have jurisdiction either to evict the Republic from the land it had taken for public use or to hear and adjudicate the Mendozas right to just compensation for it, the CA should have ordered the complaint for unlawful detainer dismissed without prejudice to their filing a proper action for recovery of such compensation. WHEREFORE, the Court partially GRANTS the petition, REVERSES the February 26, 2008 decision and the October 20, 2008 resolution of the Court of Appeals in CA-G.R. 96604, and ORDERS the dismissal of respondents Primo and Maria Mendozas action for eviction before the Municipal Trial Court in Cities of Lipa City in Civil Case 0002-99 without prejudice to their filing an action for payment of just compensation against the Republic of the Philippines or, when appropriate, against the City of Lipa. SO ORDERED.

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G.R. No. 154152 August 25, 2010 LA CAMPANA DEVELOPMENT CORPORATION, Petitioner, vs. ARTURO LEDESMA, HON. JUDGE ESTRELLA T. ESTRADA, in her capacity as PRESIDING JUDGE, Regional Trial Court, Branch 83, Quezon City, and the HON. COURT OF APPEALS, Respondents. PERALTA, J.:

the present motion, does not pretend to be. Contrary to the stand of the respondent, the petitioner is not estopped from questioning the title of respondent over the leased premises as the rule on estoppel against tenants is subject to a qualification. It does not apply if the landlord's title has expired, or has been conveyed to another, or has been defeated by a title paramount, subsequent to the commencement of lessor-lessee relationship. In other words, if there was a change in the nature of the title of the landlord during the subsistence of the lease, then the presumption does not apply. Petitioner's motion for reconsideration of said Resolution was denied on June 28, 2002.

This resolves the Petition for Certiorari under Rule 65 of the Rules of Court, praying that the Resolution1 of the Court of Appeals (CA), dated February 13, 2002, ordering the issuance of a writ of preliminary injunction, and its Resolution2 dated June 28, 2002 denying petitioners motion for reconsideration, be declared null and void ab initio. The antecedent facts are as follows. Petitioner filed an ejectment case with the Metropolitan Trial Court (MeTC) against private respondent Ledesma, alleging that despite expiration of the contract of lease executed between them and demands to vacate subject premises and pay rentals therefor, the latter failed to comply with such demands. Private respondent countered in his Answer that he had paid the rentals over subject premises and petitioner no longer had the right to possess the property as it had been foreclosed by the Development Bank of the Philippines (DBP). Private respondent further pointed out that subject premises had in fact been in the possession of the DBP since March or April of 1997, so since that time, it was with the DBP that he made arrangements for his continued occupation of the subject premises. The MeTC then rendered judgment in favor of petitioner, ordering private respondent to surrender possession of subject premises to petitioner. Private respondent appealed to the Regional Trial Court (RTC), and to stay execution of said judgment, private respondent filed a supersedeas bond with the MeTC. The RTC affirmed the MeTC judgment. Petitioner then moved for the immediate execution of the RTC Decision, which motion was granted by the RTC. Meanwhile, private respondent elevated the case to the CA via a petition for review on certiorari with prayer for the issuance of a temporary restraining order or writ of preliminary injunction. A temporary restraining order was issued by the CA, effectively staying implementation of the writ of execution issued by the RTC. Eventually, the CA also issued a writ of preliminary injunction per Resolution dated February 13, 2002. In justification of the issuance of said writ, the CA stated in said Resolution that: Based on the evidence before Us, We are convinced that the execution of the assailed decision of the RTC at this stage will probably cause injustice to the petitioner [herein private respondent]. We cannot ignore Our ruling in CA-GR CV No. 34856 which had already attained finality. The facts on hand show that the DBP is the present owner of the leased premises. The only person who can lawfully eject an unwelcome tenant from the leased premises is the owner thereof or persons deriving rights from said owner, of which private respondent [herein petitioner], in its Opposition to

Thus, petitioner filed the present petition for certiorari seeking the annulment of the aforementioned CA Resolutions. The issues boil down to whether the CA committed grave abuse of discretion amounting to lack or excess of jurisdiction when it ordered the issuance of a writ of preliminary injunction to stay the immediate execution of the RTC judgment and whether mandamus lies to compel respondent RTC Judge to issue a writ of execution. The Court finds the petition unmeritorious. For the Court to issue a writ of certiorari against the CA, it is incumbent upon petitioner to show that said lower court committed grave abuse of discretion. In Quasha Ancheta Pea & Nolasco Law Office v. Special Sixth Division, Court of Appeals,3 the Court stated that: Grave abuse of discretion means a capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction. Mere abuse of discretion is not enough; it must be so grave as when the power is exercised in an arbitrary or despotic manner by reason of passion or personal hostility, and must be so patent and so gross as to amount to an evasion of a positive duty or to a virtual refusal to perform the duty enjoined or to act at all in contemplation or law. 4 A showing of such grave abuse of discretion is sorely wanting in this case. It is true that Section 21, Rule 70 of the Rules of Court provides that "[t]he judgment of the Regional Trial Court against the defendant shall be immediately executory, without prejudice to a further appeal that may be taken therefrom." However, the Court ruled in Benedicto v. Court of Appeals5 that "on appeal the appellate court may stay the said writ should circumstances so require. x x x even if RTC judgments in unlawful detainer cases are immediately executory, preliminary injunction may still be granted." Citing Amagan v. Marayag6 and Vda. de Legaspi v. Avendao,7 the Court explained in Benedicto that: Where the action, therefore, is one of illegal detainer, as distinguished from one of forcible entry, and the right of the plaintiff to recover the premises is seriously placed in issue in a proper judicial proceeding, it is more equitable and just and less productive of confusion and disturbance of physical possession, with all its concomitant inconvenience and expenses. For the Court in which the issue of legal possession, whether involving ownership or not, is brought to restrain, should a

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petition for preliminary injunction be filed with it, the effects of any order or decision in the unlawful detainer case in order to await the final judgment in the more substantive case involving legal possession or ownership. x x x8 Moreover, the Court also stressed in City of Naga v. Asuncion9 that: As a rule, the issuance of a preliminary injunction rests entirely within the discretion of the court taking cognizance of the case and will not be interfered with, except in cases of manifest abuse. x xx xxxx x x x Be it noted that for a writ of preliminary injunction to be issued, the Rules of Court do not require that the act complained of be in clear violation of the rights of the applicant. Indeed, what the Rules require is that the act complained of be probably in violation of the rights of the applicant. Under the Rules, probability is enough basis for injunction to issue as a provisional remedy. x x x10 In the afore-quoted case, the Court reiterated that when exigencies in the case warrant it, the appellate court may stay the writ of execution issued by the RTC in an action for ejectment if there are circumstances necessitating such action. An example of such exceptional circumstance can be seen in Laurel v. Abalos.11 Therein, a defendant was ordered by the trial court to vacate the premises of the disputed property and return possession thereof to the plaintiffs, but while the ejectment case was on appeal, a judgment was promulgated in a separate case where the sale of the property to said plaintiffs was declared null and void, making the plaintiffs' right to possess the disputed property inconclusive. The Court ruled in said case that: Where supervening events (occurring subsequent to the judgment) bring about a material change in the situation of the parties which makes the execution inequitable, or where there is no compelling urgency for the execution because it is not justified by the prevailing circumstances, the court may stay immediate execution of the judgment .12 Based on the foregoing earlier ruling in Laurel,13 the Court also considered it just and equitable to stay the execution of the RTC judgment in an ejectment case against the City of Naga, stating that: Needless to reiterate, grave and irreparable injury will be inflicted on the City of Naga by the immediate execution of the June 20, 2005 RTC Decision. x x x the people of Naga would be deprived of access to basic social services. It should not be forgotten that the land subject of the ejectment case houses government offices which perform important functions vital to the orderly operation of the local government. x x x14 In the present case, there also exists a material change in the situation of the parties. The CA properly took into serious consideration the fact that in its Decision in CA-G.R. CV No. 34856 entitled La Campana Food Products, Inc. v. Development Bank of the Philippines, which has

become final and executory, it ordered herein petitioner, formerly known as La Campana Food Products, Inc., to surrender possession of subject properties to the Development Bank of the Philippines. Evidently, a serious cloud of doubt has been cast on petitioners right of possession, making it questionable whether the RTC Decision, ordering private respondent to surrender possession of subject premises to petitioner, should be immediately implemented. Therefore, the CA did not gravely abuse its discretion in this case; rather, it acted prudently when it stayed execution of the RTC Decision until such time that a final resolution of the main case is reached. Petitioner's contention, that it was improper for the CA to have granted private respondent's motion to consider thesupersedeas bond it posted with the Metropolitan Trial Court as sufficient to cover the bond required for the issuance of the writ of preliminary injunction, is likewise incorrect. Petitioner argues that, "said supersedeas bond is posted solely and primarily to answer for a specific purpose which is for the payment of unpaid rentals accruing up to the final judgment. This cannot be held answerable for damages to petitioner should it later be found out that the private respondent is not entitled to the issuance [of a writ of preliminary injunction]." 15 Note that Section 4(b), Rule 58 of the Rules of Court provides that: (b) Unless exempted by the court, the applicant files with the court where the action or proceeding is pending, a bond executed to the party or person enjoined, in an amount to be fixed by the court, to the effect that the applicant will pay to such party or person all damages which he may sustain by reason of the injunction or temporary restraining order if the court should finally decide that the applicant was not entitled thereto. Upon approval of the requisite bond, a writ of preliminary injunction shall be issued; However, in Hualam Construction and Dev't. Corp. v. Court of Appeals ,16 the Court expounded on what damages may be recovered in actions for forcible entry or unlawful detainer, to wit: As to damages, We have on several occasions ruled that since the only issue raised in forcible entry or unlawful detainer cases is that of rightful physical possession, the "damages" recoverable in these cases are those which the plaintiff could have sustained as a mere possessor, i.e., those caused by the loss of the use and occupation of the property, and not the damages which he may have suffered but which have no direct relation to his loss of material possession. x x x Simply put, "damages" in the context of Section 8 of Rule 70 [now Section 19, Rule 70 of the Rules of Court] is limited to "rent" or "fair rental value" for the use and occupation of the property. 171wphi1 Since the only damages that petitioner may be entitled to in an action for unlawful detainer are those arising from its loss of the use or occupation of subject premises, the only damages petitioner can claim by reason of the stay of execution of the RTC judgment is also only for the "rent" or "fair rental value" for the property in question. Therefore, the CA did not err in considering the supersedeas bond filed with the MTC, which answers for unpaid rentals, as sufficient bond for the issuance of a writ of preliminary injunction.

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In light of the foregoing, it is quite clear that there is no reason to compel the RTC to immediately implement the writ of execution in this case. WHEREFORE, the petition is DISMISSED for lack of merit. The Resolutions of the Court of Appeals, dated February 13, 2002 and June 28, 2002, respectively, in CA-G.R. SP No. 66668, are AFFIRMED. SO ORDERED.

1954, the Municipal Board of Naga City (Municipal Board) asked CHS to increase the area of the land to four (4) hectares. Accordingly, CHS amended its offer to five (5) hectares. On August 11, 1954, the Municipal Board adopted Resolution No. 89 12 accepting CHS amended offer. Mariano and Gimenez thereafter delivered possession of the lots described as Blocks 25 and 26 to the City Government of Naga (city government). Eventually, the contract for the construction of the city hall was awarded by the Bureau of Public Works through public bidding to Francisco O. Sabaria, a local contractor. This prompted Mariano and Gimenez to demand the return of the parcels of land from petitioner. On assurance, however, of then Naga City Mayor Monico Imperial that petitioner will buy the lots instead, Mariano and Gimenez allowed the city government to continue in possession of the land. On September 17, 1959, Mariano wrote a letter13 to Mayor Imperial inquiring on the status of the latters proposal for the city government to buy the lots instead. Then, through a note 14 dated May 14, 1968, Mariano directed Atty. Eusebio Lopez, Jr., CHS General Manager, to disregard the proposed donation of lots and insist on Mayor Imperials offer for the city government to purchase them. On December 2, 1971, Macario A. Mariano died. Meanwhile, the city government continued in possession of the lots, and constructed the Naga City Hall on Block 25 and the public market on Block 26. It also conveyed to other government offices 15 portions of the land which at present, house the National Bureau of Investigation (NBI), Land Transportation Office, and Hall of Justice, among others. In a Letter16 dated September 3, 2003, Danilo D. Mariano, as administrator and representative of the heirs of Macario A. Mariano, demanded from petitioner the return of Blocks 25 and 26 to CHS. Alas, to no avail. Thus, on February 12, 2004, respondent filed a Complaint 17 for unlawful detainer against petitioner before the Municipal Trial Court (MTC) of Naga City, Branch 1. In a Decision 18 dated February 14, 2005 of the MTC in Civil Case No. 12334, the MTC dismissed the case for lack of jurisdiction. It ruled that the citys claim of ownership over the lots posed an issue not cognizable in an unlawful detainer case. On appeal, the RTC reversed the court a quo by Decision19 dated June 20, 2005 in Civil Case No. RTC 2005-0030. It directed petitioner to surrender physical possession of the lots to respondents with forfeiture of all the improvements, and to pay P2,500,000.00 monthly as reasonable compensation for the use and occupation of the land; P587,159.60 as attorneys fees; and the costs of suit. On June 27, 2005, petitioner filed a Motion for Inhibition against Presiding RTC Judge Filemon B. Montenegro for alleged bias and partiality. Then, petitioner moved for reconsideration/new trial of the June 20, 2005 Decision. On July 15, 2005, the RTC denied both motions.

G.R. No. 174042 July 9, 2008 CITY OF NAGA, as represented by Mayor Jesse M. Robredo, Petitioner, vs. HON. ELVI JOHN S. ASUNCION, as ponente and chairman, HON. JUSTICES JOSE C. MENDOZA and ARTURO G. TAYAG, as members, 12th DIVISION, COURT OF APPEALS, HON. JUDGE FILEMON MONTENEGRO, Presiding Judge, Regional Trial Court, Branch 26, Naga City; ATTY. JESUS MAMPO, Clerk of Court, RTC, Branch 26, Naga City, SHERIFF JORGE B. LOPEZ, RTC, Branch 26, Naga City, THE HEIRS OF JOSE MARIANO and HELEN S. MARIANO represented by DANILO DAVID S. MARIANO, MARY THERESE IRENE S. MARIANO, MA. CATALINA SOPHIA S. MARIANO, JOSE MARIO S. MARIANO, MA. LEONOR S. MARIANO, MACARIO S. MARIANO and ERLINDA MARIANO-VILLANUEVA, Respondents. QUISUMBING, J.: This petition for certiorari and prohibition under Rule 65 of the Rules of Court seeks the reversal of the Resolution1 dated August 16, 2006 of the Court of Appeals in CA-G.R. SP No. 90547 which denied the Application for a Writ of Preliminary Prohibitory Injunction 2 filed by petitioner. Challenged as well is the Order3 dated August 17, 2006 of the Regional Trial Court (RTC) of Naga City, Branch 26 in Civil Case No. RTC 2005-0030 for unlawful detainer which granted respondents Motion to Issue Writ of Execution4 filed on August 16, 2005 and denied petitioners Motion for Inhibition5 filed on June 27, 2005. Concomitantly, the processes issued to enforce said Order are equally assailed, namely: the Writ of Execution Pending Appeal 6 dated August 22, 2006; the Notice to Vacate7 dated August 23, 2006; and the Notice of Garnishment 8 dated August 23, 2006. The facts as culled from the rollo of this petition and from the averments of the parties to this petition are as follows: Macario A. Mariano and Jose A. Gimenez were the registered owners of a 229,301-square meter land covered by Transfer Certificate of Title (TCT) No. 6719 located in Naga City. The land was subdivided into several lots and sold as part of City Heights Subdivision (CHS). In a Letter10 dated July 3, 1954, the officers of CHS offered to construct the Naga City Hall on a two (2)-hectare lot within the premises of the subdivision. Said lot was to be designated as an open space for public purpose and donated to petitioner in accordance with the rules and regulations of the National Urban Planning Commission. By Resolution No. 75 11 dated July 12,

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On July 22, 2005, petitioner filed a Petition for Review with Very Urgent Motion/Application for Temporary Restraining Order and Writ of Preliminary Prohibitory Injunction 20 with the Court of Appeals. Respondents thereafter filed a Motion to Issue Writ of Execution. On October 13, 2005, respondents manifested that they will not seek execution against the NBI, City Hall and Hall of Justice in case the writ of preliminary injunction is denied. On August 16, 2006, the appellate court issued the challenged Resolution, the decretal portion of which reads: WHEREFORE, based on the foregoing premises, and in the absence of any immediate threat of grave and irreparable injury, petitioners prayer for issuance of a writ of preliminary injunction is hereby DENIED. Petitioner had already filed its Memorandum. Hence, the private respondents are given fifteen (15) days from notice within which to submit their Memorandum. SO ORDERED.21 On August 17, 2006, the RTC issued the assailed Order, thus: WHEREFORE, let the corresponding Writ of Execution Pending Appeal be issued in this case immediately pursuant to Sec. 21, Rule 70. However, in view of the MANIFESTATION of plaintiffs dated October 13, 2005 that they will not take possession of the land and building where the City Hall, Hall of Justice and National Bureau of Investigation are located while this case is still pending before the Court of Appeals, this writ of execution shall be subject to the above-cited exception. The Sangguniang [Panlungsod] of Naga City is hereby directed to immediately appropriate the necessary amount of [P]2,500,000.00 per month representing the unpaid rentals reckoned from November 30, 2003 up to the present from its UNAPPROPRIATED FUNDS to satisfy the claim of the plaintiffs, subject to the existing accounting and auditing rules and regulations. SO ORDERED.22 Consequently, Clerk of Court Atty. Jesus Mampo issued a writ of execution pending appeal. Sheriff Jorge B. Lopez on the other hand, served a notice to vacate on respondents, and a notice of garnishment on Land Bank, Naga City Branch. Hence, this petition for certiorari and prohibition. On August 28, 2006, we issued a Temporary Restraining Order 23 to maintain the status quo pending resolution of the petition. Petitioner raises the following issues for our consideration:

I.

WHETHER OR NOT PETITIONER CAN VALIDLY AVAIL OF THE EXTRAORDINARY WRITS OF CERTIORARI AND PROHIBITION IN ASSAILING THE CHALLENGED RESOLUTION, ORDERS AND NOTICES. WHETHER OR NOT PETITIONER IS GUILTY OF FORUM-SHOPPING. WHETHER OR NOT PUBLIC RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF DISCRETION IN ALLOWING THE IMMEDIATE EXECUTION OF ITS JUDGMENT NOTWITHSTANDING THE CATASTROPHIC CONSEQUENCES IT WILL BEAR ON THE DELIVERY OF BASIC GOVERNMENTAL SERVICES TO THE GOOD CITIZENS OF NAGA CITY; THE INCONCLUSIVENESS OF PRIVATE RESPONDENTS TITLE AND CLAIM OF POSSESSION OVER THE SUBJECT PROPERTY; AND THE IMPUTATION OF BIAS AND PARTIALITY AGAINST PUBLIC RESPONDENT JUDGE. WHETHER OR NOT PUBLIC RESPONDENTS JUDGE FILEMON B. MONTENEGRO, ATTY. JESUS MAMPO AND SHERIFF JORGE B. LOPEZ EXCEEDED THEIR AUTHORITY AND/OR COMMITTED GRAVE ABUSE OF DISCRETION IN TRYING TO EVICT PETITIONER AND VARIOUS DEPARTMENTS AND OFFICES THEREOF FROM THE SUBJECT PROPERTY. WHETHER OR NOT PUBLIC RESPONDENT JUDGE FILEMON B. MONTENEGRO EXCEEDED HIS JURISDICTION AND/OR COMMITTED GRAVE ABUSE OF DISCRETION IN DIRECTING PETITIONER TO PAY PRIVATE RESPONDENTS MONTHLY RENTALS OF ABOUT [P]81,500,000.00. WHETHER OR NOT THE ORDER DIRECTING PETITIONER TO PAY PRIVATE RESPONDENT MONTHLY RENTALS [DISREGARDED] THE HONORABLE COURTS ADMINISTRATIVE CIRCULAR NO. 10-2000 AND THE LAW AND THE JURISPRUDENCE CITED THEREIN. WHETHER OR NOT PUBLIC RESPONDENTS JUDGE FILEMON B. MONTENEGRO, ATTY. JESUS MAMPO AND SHERIFF JORGE B. LOPEZ EXCEEDED THEIR AUTHORITY AND/OR COMMITTED GRAVE ABUSE OF DISCRETION IN CAUSING THE GARNISHMENT OF PETITIONERS ACCOUNT WITH LAND BANK OF THE PHILIPPINES. WHETHER OR NOT THE HONORABLE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION IN DENYING THE PETITIONERS APPLICATION FOR WRIT OF PRELIMINARY PROHIBITORY INJUNCTION.24

II. III.

IV.

V.

VI.

VII.

VIII.

The pertinent issues, in our view, are as follows: (1) whether petitioner availed of the proper remedy to contest the disputed order, resolution, and notices; (2) whether petitioner was guilty of forum-shopping in filing the instant petition pending the petition for review before the Court of Appeals; (3) whether RTC Judge Montenegro committed grave abuse of discretion in granting

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execution pending appeal; and (4) whether the Court of Appeals committed grave abuse of discretion in denying petitioners application for a writ of preliminary injunction. Petitioner City of Naga ascribes grave abuse of discretion on Judge Montenegro for allowing execution pending appeal and for refusing to inhibit himself from the proceedings. It contends that its claim of ownership over the lots behooved the RTC of jurisdiction to try the illegal detainer case. Granting arguendo that the RTC had jurisdiction and its judgment was immediately executory, petitioner insists that the circumstances in the case at bar warranted against it. For one, the people of Naga would be deprived of access to basic social services even before respondents right to possess the land has been conclusively established. The City of Naga assails the validity of the order of execution issued by the court inasmuch as it excluded the NBI, City Hall and Hall of Justice from its coverage; ordered garnishment of government funds; and directed the Sangguniang Panlungsod to appropriate money in violation of the Supreme Court Administrative Circular No. 10-2000.25 Petitioner likewise claims that Atty. Jesus Mampo and Sheriff Jorge B. Lopez acted with manifest abuse when they issued the writ of execution pending appeal, and served notice to vacate and notice of garnishment, respectively. Finally, petitioner imputes grave abuse of discretion on the Court of Appeals for denying its application for a writ of preliminary injunction. The appellate tribunal struck down petitioners application pending resolution by the RTC of respondents motion to execute its June 20, 2005 Decision. Also, it found no merit in petitioners claim that grave and irreparable injury will result to the City of Naga by the implementation of said decision. Nevertheless, it excused the NBI, Naga City Hall and Hall of Justice from execution. For their part, respondents (Marianos) call for the dismissal of the instant petition on the ground of forum-shopping. They aver that the petition for review in the Court of Appeals and the present petition are but similar attempts to stop the immediate enforcement of the June 20, 2005 RTC Decision. They add that the court a quomerely acted in obedience to the provisions of Section 2126 of Rule 70 of the Rules of Court when it ordered execution. Thus, the writ of execution, notice to vacate and notice of garnishment are also valid as incidents of the August 17, 2006 RTC Order. Respondents agree with the appellate court that there is no immediate threat of grave and irreparable injury to petitioner. In any case, the Marianos suggest that petitioner just seek reparation for damages should the appellate court reverse the RTC. Lastly, respondents allege that the court a quo correctly ruled on the merits despite its finding that the MTC erroneously dismissed the unlawful detainer case for lack of jurisdiction. The MTC based its decision on the affidavits and position papers submitted by the parties. The petition is partly meritorious. In the interest of justice, we decided to give due course to the petition for certiorari and prohibition concerning the August 17, 2006 Order of the RTC. As a rule, petitions for the issuance of such extraordinary writs against an RTC should be filed with the Court of Appeals. A direct invocation of this Courts original jurisdiction to issue these writs should be allowed only when there are special and important reasons therefor, clearly and specifically set out in the petition. 27 Under the present circumstance however, we agree to take cognizance of this case as an exception to the principle of hierarchy of courts.28 For while it has been held by this Court that a motion for reconsideration is

a condition sine qua non for the grant of a writ of certiorari, nevertheless such requirement may be dispensed with where there is an urgent necessity for the resolution of the question and any further delay would prejudice the interests of the Government. 29 Such is the situation in the case at bar. Thus, we find no merit in respondents contention that petitioner erred in its choice of remedy before this Court. Under Section 1(c) and (f),30 Rule 41 of the Rules of Court, no appeal may be taken from an interlocutory order and an order of execution, respectively. An interlocutory order is one which does not dispose of the case completely but leaves something to be decided upon.31 Such is the nature of an order granting or denying an application for preliminary injunction; hence, not appealable.32 The proper remedy, as petitioner did in this case, is to file a petition for certiorari and/or prohibition under Rule 65. Nor can we agree that petitioner was guilty of forum-shopping. Under the Same Objective Standard enunciated in the case of First Philippine International Bank v. Court of Appeals,33 the filing by a party of two apparently different actions, but with the same objective, constitutes forumshopping.34 Here, the special civil action of certiorari before us is an independent action. The ultimate purpose of such action is to keep the inferior tribunal within the bounds of its jurisdiction or relieve parties from arbitrary acts of the court. 35 In contrast, the petition for review before the Court of Appeals under Rule 42 involves an evaluation of the case on the merits. Clearly, petitioner did not commit forum-shopping. Now, we shall proceed to resolve the contentious issues in this case. Section 21, Rule 70 of the Rules of Court is pertinent: SEC. 21. Immediate execution on appeal to Court of Appeals or Supreme Court. The judgment of the Regional Trial Court against the defendant shall be immediately executory, without prejudice to a further appeal that may be taken therefrom. Thus, the judgment of the RTC against the defendant in an ejectment case is immediately executory. Unlike Section 19,36 Rule 70 of the Rules, Section 21 does not provide a means to prevent execution; hence, the courts duty to order such execution is practically ministerial.37 Section 21 of Rule 70 presupposes that the defendant in a forcible entry or unlawful detainer case is unsatisfied with the judgment of the RTC and decides to appeal to a superior court. It authorizes the RTC to immediately issue a writ of execution without prejudice to the appeal taking its due course. Nevertheless, it should be stressed that the appellate court may stay the said writ should circumstances so require.38 Petitioner herein invokes seasonably the exceptions to immediate execution of judgments in ejectment cases cited in Hualam Construction and Devt. Corp. v. Court of Appeals 39 and Laurel v. Abalos,40 thus: Where supervening events (occurring subsequent to the judgment) bring about a material change in the situation of the parties which makes the execution inequitable, or where there is no

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compelling urgency for the execution because it is not justified by the prevailing circumstances, the court may stay immediate execution of the judgment. 41 Noteworthy, the foregoing exceptions were made in reference to Section 8, 42 Rule 70 of the old Rules of Court which has been substantially reproduced as Section 19, Rule 70 of the 1997 Rules of Civil Procedure. Therefore, even if the appealing defendant was not able to file a supersedeas bond, and make periodic deposits to the appellate court, immediate execution of the MTC decision is not proper where the circumstances of the case fall under any of the above-mentioned exceptions. Yet, Section 21, Rule 70 of the Rules does not provide for a procedure to avert immediate execution of an RTC decision. This is not to say that the losing defendant in an ejectment case is without recourse to avoid immediate execution of the RTC decision. The defendant may, as in this case, appeal said judgment to the Court of Appeals and therein apply for a writ of preliminary injunction. Thus, as held in Benedicto v. Court of Appeals,43 even if RTC judgments in unlawful detainer cases are immediately executory, preliminary injunction may still be granted. 44 In the present case, the Court of Appeals denied petitioners application for a writ of preliminary injunction because the RTC has yet to rule on respondents Motion to Issue Writ of Execution. Significantly, however, it also made a finding that said application was without merit. On this score, we are unable to agree with the appellate court. A writ of preliminary injunction is available to prevent threatened or continuous irremediable injury to parties before their claims can be thoroughly studied and adjudicated. Its sole objective is to preserve the status quo until the merits of the case can be heard fully.45 Status quo is the last actual, peaceable and uncontested situation which precedes a controversy. 46 As a rule, the issuance of a preliminary injunction rests entirely within the discretion of the court taking cognizance of the case and will not be interfered with, except in cases of manifest abuse.47 Grave abuse of discretion implies a capricious and whimsical exercise of judgment tantamount to lack or excess of jurisdiction. The exercise of power must have been done in an arbitrary or a despotic manner by reason of passion or personal hostility. It must have been so patent and gross as to amount to an evasion of positive duty or a virtual refusal to perform the duty enjoined or to act at all in contemplation of law. 48 Considering the circumstances in this case, we find that the Court of Appeals abused its discretion when it denied petitioners application for a writ of preliminary injunction because of the pendency of respondents Motion to Issue Writ of Execution with the RTC, but ruled on the merits of the application at the same time. At most, the appellate court should have deferred resolution on the application until the RTC has decided on the motion for execution pending appeal. Moreover, nothing in the rules allow a qualified execution pending appeal that would have justified the exclusion of the NBI, City Hall and Hall of Justice from the effects of the writ. In any case, we have ploughed through the records of this case and we are convinced of the pressing need for a writ of preliminary injunction. Be it noted that for a writ of preliminary injunction

to be issued, the Rules of Court do not require that the act complained of be in clear violation of the rights of the applicant. Indeed, what the Rules require is that the act complained of be probably in violation of the rights of the applicant. Under the Rules, probability is enough basis for injunction to issue as a provisional remedy. This situation is different from injunction as a main action where one needs to establish absolute certainty as basis for a final and permanent injunction.491avvphi1 Thus, we have stressed the foregoing distinction to justify the issuance of a writ of preliminary injunction in actions for unlawful detainer: ...Where the action, therefore, is one of illegal detainer, as distinguished from one of forcible entry, and the right of the plaintiff to recover the premises is seriously placed in issue in a proper judicial proceeding, it is more equitable and just and less productive of confusion and disturbance of physical possession, with all its concomitant inconvenience and expenses. For the Court in which the issue of legal possession, whether involving ownership or not, is brought to restrain, should a petition for preliminary injunction be filed with it, the effects of any order or decision in the unlawful detainer case in order to await the final judgment in the more substantive case involving legal possession or ownership. It is only where there has been forcible entry that as a matter of public policy the right to physical possession should be immediately set at rest in favor of the prior possession regardless of the fact that the other party might ultimately be found to have superior claim to the premises involved, thereby to discourage any attempt to recover possession thru force, strategy or stealth and without resorting to the courts. 50 Needless to reiterate, grave and irreparable injury will be inflicted on the City of Naga by the immediate execution of the June 20, 2005 RTC Decision. Foremost, as pointed out by petitioner, the people of Naga would be deprived of access to basic social services. It should not be forgotten that the land subject of the ejectment case houses government offices which perform important functions vital to the orderly operation of the local government. As regards the garnishment of Naga Citys account with the Land Bank, the rule is and has always been that all government funds deposited in official depositary of the Philippine Government by any of its agencies or instrumentalities, whether by general or special deposit, remain government funds. Hence, they may not be subject to garnishment or levy, in the absence of corresponding appropriation as required by law.51 For this reason, we hold that the Notice of Garnishment dated August 23, 2006 is void. Anent Judge Montenegros refusal to recuse himself from the proceedings, we find no grave abuse of discretion. We have held time and again that inhibition must be for just and valid causes. The mere imputation of bias and partiality is not enough ground for judges to inhibit, especially when the charge is without sufficient basis. This Court has to be shown acts or conduct clearly indicative of arbitrariness or prejudice before it can brand concerned judges with the stigma of bias and partiality. Bare allegations of partiality will not suffice "in the absence of clear and convincing evidence to overcome the presumption that the judge will undertake his noble role to dispense justice according to law and evidence without fear and favor. 52 The Resolution53 of the Court En Banc dated June 27, 2006 which dismissed the complaint filed by Mayor Jesse Robredo against Judge Montenegro served to negate petitioners allegations. Nevertheless, when the ground sought for the judges inhibition is not among those enumerated in Section 1, 54 Rule 137 of

27

the Rules of Court, a judge may, in the exercise of his sound discretion, disqualify himself from sitting in a case, for just or valid reasons. Similarly, in our view, the charge of grave abuse of discretion against Clerk of Court Atty. Jesus Mampo and Sheriff Jorge B. Lopez cannot prosper. When Judge Montenegro issued the order directing the issuance of a writ of execution, Atty. Jesus Mampo was left with no choice but to issue the writ. Such was his ministerial duty in accordance with Section 4, 55 Rule 136 of the Rules of Court.56 In the same vein, when the writ was placed in the hands of Sheriff Lopez, it was his duty, in the absence of instructions to the contrary, to proceed with reasonable celerity and promptness to implement it in accordance with its mandate. It is elementary that a sheriffs duty in the execution of the writ is purely ministerial; he is to execute the order of the court strictly to the letter. He has no discretion whether to execute the judgment or not. The rule may appear harsh, but such is the rule we have to observe.57 WHEREFORE, the instant petition is PARTLY GRANTED, and it is hereby ORDERED that: (A) The Resolution dated August 16, 2006 of the Court of Appeals in CA-G.R. SP No. 90547 is REVERSEDand SET ASIDE. The Court of Appeals is ORDERED to issue a writ of preliminary injunction to restrain the execution of the Decision dated June 20, 2005 of the Regional Trial Court, Branch 26, Naga City pending resolution of the petition for review before it; (B) The Writ of Execution Pending Appeal dated August 22, 2006, Notice to Vacate dated August 23, 2006, and the Notice of Garnishment dated August 23, 2006 are SET ASIDE. Lastly, the Court of Appeals is hereby ENJOINED to resolve the pending petition for review before it, CA-G.R. SP No. 90547, without further delay, in a manner not inconsistent with this Decision. SO ORDERED.

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