Philippine Supreme Court Jurisprudence > Year 2016 > June 2016 Decisions > G. R. No. 185169, June 15, 2016 - HEIRS OF CATALINO DACANAY, HIS WIFE ERLINDA DACANAY, THEIR CHILDREN AURORA D. CONSTANTINO AND REYNALDO DACANAY; LOLITA DACANAY VDA. DE PARASO; HEIRS OF SOLEDAD APOSTOL, NAMELY: HER HUSBAND LEONARDO CAGUIOA, THEIR CHILDREN AMALIA, DANILO, RONALD, MARLENE, ROBERT, ROLDAN, THELMA AND TERESA, ALL SURNAMED CAGUIOA, Petitioners, v. JUAN SIAPNO, JR., MARIO RILLON, SPOUSES JOSE TAN AND LETICIA DY TAN, Respondents.:

This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court assailing the Resolution¹ dated 8 September 2008 and the Order² dated 13 October 2008 in Civil Case No. 18857 issued by Regional Trial Court (RTC) Branch 69 in Lingayen, Pangasinan. The trial court dismissed petitioners' Complaint³ for Declaration of Nullity of Documents with Partition and Damages and denied⁴ their Motion for Reconsideration.

The sole issue raised by petitioners is whether the RTC committed a grave error of law when it dismissed the Complaint pursuant to a Decision⁵ dated 3 July 2006 rendered by the Department of Agrarian Reform Adjudication Board (DARAB) in DARAB Case No. 9631.

We answer in the affirmative. There is no identity of parties and causes of action between the case before the RTC and the case heard by the DARAB.

FACTS OF THE CASE

Petitioners claim to be the descendants and heirs of Esperanza Espiritu vda. de Apostol, who was allegedly the original owner of a parcel of land located at Barangay Olo-Cacamposan, Mangatarem, Pangasinan.⁶ It had an area of 13,165 square meters, and was initially covered by Original Certificate of Title (OCT) No. P-13438⁷ registered in the name of "HEIRS OF ESPERANZA ESPIRITU, represented by Antonia Apostol."

Sometime in 1995, OCT No. P-13438 was cancelled and Transfer Certificate of Title (TCT) No. 202765⁸ was issued to Juan C. Siapno, Jr. (Siapno). In April 1996, TCT No. 202765 was likewise cancelled and TCT No. 212328 was issued to Spouses Jose Sy Tan and Leticia Dy Tan (Sps. Tan).

Petitioners allege that Espiritu had three daughters: Feliciana, Juana, and Anastacia. Feliciana married Vicente Dacanay with whom she had a son, Catalino and a daughter, Lolita. Juana died without issue. Anastacia married Roberto Fabros with whom she had a daughter, Soledad. Soledad married Leonardo Caguioa, and their children are now among the petitioners in this case.

According to petitioners, the transfer of title from the heirs of Esperanza Espiritu to Siapno was made possible by a forged Affidavit of Declaration of Heirs⁹ allegedly executed by Feliciana's son, Catalino, on 16 December 1994. In the document, Catalino was represented as single and the only heir and nephew of Espiritu. On the same day, he appeared to have sold the subject parcel of land to Siapno through a Deed of Absolute Sale.¹⁰ChanRoblesVirtualawlibrary

On 19 March 1996, Siapno sold the subject parcel of land to Sps. Tan. Thereafter, respondent Mario Rillon (Rillon), claiming to be the tenant of Catalino, filed a Complaint before the DARAB.¹¹ He alleged that because he had not been notified of the sale between Siapno and Sps. Tan, he failed to exercise his right of redemption provided under Republic Act (R.A.) No. 3844, as amended by R.A. No. 6389.¹² On 3 July 2006, the DARAB found him to be a bona fide tenant of the subject property, hence, entitled to redeem it.

On 7 May 2008, petitioners filed a Complaint before the RTC assailing the series of transfers of ownership over the subject parcel of land. They prayed for the declaration of nullity of the Affidavit of Declaration of Heirs, the Deed of Absolute Sale in favor of Siapno, TCT No. 202765, Tax Declaration No. 8894, the Deed of Absolute Sale in favor of Sps. Tan, and TCT No. 212328.¹³ They also prayed for the reversion of the land to the heirs of Espiritu and the partition thereof among them.¹⁴ Further, petitioner asked for moral damages, attorney's fees, litigation expenses and appearance fee.¹⁵ They attached a copy of the Marriage Contract¹⁶ between Catalino and Erlinda Brudo as proof that in 1994, he was already married. They clarified that Catalino was a grandson, not a nephew, of Espiritu.¹⁷ Pointing out that the title had already been transferred to the heirs of Espiritu, they likewise argued that Catalino could not have inherited the land from Espiritu.¹⁸ Petitioners posited that Rillon could not redeem the land, because the purported sales between Catalino and Siapno, and later between Siapno and Sps. Tan, were void ab initio.¹⁹ChanRoblesVirtualawlibrary

Siapno, in his Answer with Compulsory Counterclaim,²⁰ prayed that the Complaint be dismissed against him on the ground that venue had been improperly laid. He theorized that the action was in personam, and should have been filed in the place where any of the plaintiffs or defendants resided.²¹ He argued that the court had no jurisdiction over the subject of the action considering that 14 years had elapsed since the Deed of Absolute Sale was executed.²² He also attached several documents allegedly showing that Lolita and several other plaintiffs had consented to the sale made by Catalino.²³ChanRoblesVirtualawlibrary

Sps. Tan filed a separate Answer with Compulsory Counterclaim,²⁴ in which they denied knowledge of the circumstances surrounding the sale between Catalino and Siapno. The spouses claimed to be buyers in good faith and put up as an affirmative defense the fact that petitioners had no cause of action against them, because they have already been stripped of their rights to the land by virtue of the DARAB Decision.²⁵ Like Siapno, they also argued that the action had prescribed. In addition, they argued that the subject matter was outside the jurisdiction of the RTC since the assessed value of the property was less than P20,000. They further argued that the case was prematurely filed because "there is no showing that there are co�heirs who refuse an extrajudicial partition."²⁶ChanRoblesVirtualawlibrary

Rillon likewise filed a separate Answer with Compulsory Counterclaim,²⁷ in which he denied knowledge of the series of transfers of the subject parcel of land. He maintained that the plaintiffs had no cause of action against him, because he was the rightful owner of the land by virtue of the DARAB Decision.²⁸ChanRoblesVirtualawlibrary

RULING OF THE RTC

The RTC noted that at the time of the filing of the Complaint, the DARAB Decision had become final and executory. The court justified its dismissal of the Complaint as follows:

[W]hen the DARAB adjudicated the parcel of land to defendant Rillon, it, in effect, declared the sales between Catalino Dacanay and defendant Siapno and later between defendant Siapno and defendants-spouses Tan to be inefficacious. This renders the prayer of plaintiffs that the said sales be declared null and void futile.

Relative thereto, since title and ownership over the subject parcel of land have been declared to be vested in defendant Rillon by final and executory judgment, the prayer of plaintiffs that the said property be partitioned among them is likewise futile. Stated simply and as a matter of common sense, there is nothing to partition.

x x x x

[A]s pointed out by defendants-spouses Tan, plaintiffs must first establish their status as the rightful heirs, and therefore co-owners, of the estate of the late Esperanza Espiritu before any partition of the latter's estate may be effected. And this may be determined only in a settlement proceeding in accordance with the procedure laid down by the Rules.

Petitioners filed a Motion for Reconsideration,²⁹ but it was denied by the RTC. On the theory that the case concerns pure questions of law, they have elevated the case directly to this Court.

Petitioners argue that their cause of action is not barred by the DARAB Decision.³⁰ They contend that res judicata does not apply because the DARAB case was between Rillon and Sps. Tan only, and that the Decision therein merely upheld the tenant's right to redeem the land. Petitioners emphasize that the DARAB did not pass upon the validity of the documents sought to be declared null and void before the RTC.³¹ They pray that the trial court's Resolution dated 8 September 2008 and Order dated 13 October 2008 be reversed, and that the case be remanded to the same branch for the continuation of trial on the merits.³²ChanRoblesVirtualawlibrary

Siapno filed an Opposition to Petition for Review,³³ which the Court treated as his Comment.³⁴ He asserted that the land had been sold to him by the heirs of Espiritu, and that the action to declare the documents void had already prescribed.³⁵ChanRoblesVirtualawlibrary

Upon orders of the Court, Sps. Tan filed their Comment³⁶ and claimed that the Petition failed to set forth questions of law. Further, they asserted that the complaint stated no cause of action because petitioners did not allege that the decedent left no will and no debts, and that all the heirs could not agree to divide the estate among themselves.³⁷ According to the spouses, the action for partition was also outside the jurisdiction of the RTC since the assessed value of the land as shown in the Tax Declaration was only P2,150.³⁸ChanRoblesVirtualawlibrary

For his part, Rillon argued that the DARAB Decision had already become final and executory.³⁹ And because the lot had been validly transferred to him by virtue of the decision, he viewed the complaint as lacking a cause of action.⁴⁰ChanRoblesVirtualawlibrary

OUR RULING

We rule for petitioners. The trial court committed an error of law when it dismissed the Complaint on the ground of res judicata. For the principle to apply, the following requisites must concur:

1) There is a final judgment or order.

2) The court rendering the judgment has jurisdiction over the parties and subject matter.

3) The former judgment is a judgment on the merits.

4) There is between the first and the second actions an identity of parties, subject matter, and causes of action.⁴¹ChanRoblesVirtualawlibrary

The fourth requisite is absent in this case.

There is no identity of parties. It is undisputed that petitioners were not parties to the DARAB case; it was between Rillon and Sps. Tan.

In Green Acres Holdings, Inc. v. Cabral,⁴² the petitioner therein was also not made party to the DARAB case. The Court ruled that in conformity with the constitutional guarantee of due process of law, no one shall be affected by any proceeding to which one is a stranger, and strangers to a case are not bound by any judgment rendered by the court.⁴³ For the same reason, DARAB Case No. 9631 should not bind petitioners in this case.

There is no identity of cause of action. DARAB Case No. 9631 involved a tenant's right to redeem the land, while the instant case involves the validity of the transfer documents. There is merit in petitioners' argument that the DARAB cannot be deemed to have invalidated the sale, as it did not even touch upon the validity of the documents.⁴⁴ The DARAB Decision merely lifted a portion of the Decision of the Provincial Agrarian Reform Adjudicator, which mentioned the Deeds of Sale between Catalino and Siapno and then Siapno and Sps. Tan only in connection with the land description. Indeed, it was a bit of a stretch for the trial court to have concluded that when the DARAB adjudicated the parcel of land to Rillon, it "in effect" declared the sale between Catalino and Siapno and later between Siapno and Sps. Tan to be inefficacious.⁴⁵ The DARAB Decision only settled the preferential right of a tenant to redeem the land and not the validity of the documents.

We stress that our ruling in this case is limited only to the propriety of the dismissal of the Complaint on the ground of res judicata. The other grounds for dismissal that have been raised by respondents, but have not been addressed by the trial court, are not foreclosed by this Resolution. We have decided not to pass upon these grounds, as they entail fact-finding, which is not a function of this Court. Considering that the trial court has not made any factual determination of the issues raised by respondents, We deem it best to remand the case for proper disposition.

The IBP is directed to conduct
disciplinary proceedings against
petitioners' counsel.

The resolution of this case has been delayed by the contumacious behavior of petitioners' counsel, Atty. Eugenio F. Manaois (Atty. Manaois).� The Court has given him opportunities to remedy a defect in the Verification and Certification of Non-Forum Shopping attached to the Petition. The Court even allowed him to sign the Petition after it had been filed. However, he has failed to comply with the Resolutions dated 3 December 2008 and 28 January 2009 and with the show cause order embodied in the Resolution dated 25 November 2009. He has not even bothered to offer any explanation for his failure to do so.

We hereby institute disciplinary proceedings⁴⁶ against Atty. Manaois and refer the case to the Integrated Bar of the Philippines (IBP) for investigation, report, and recommendation based on the following facts:

In the Resolution⁴⁷ dated 3 December 2008, the Court required Atty. Manaois to submit, a) proof of service of the Motion for extension upon the RTC; and b) his updated IBP official receipt number and date of issue, both within 10 days of notice; and c) an affidavit of service of the motion for extension with a properly accomplished jurat showing that the affiants have exhibited before the notary public at least one current identification document issued by an official agency bearing their photographs and signatures as required under Sections 2, 6 and 12, Rule II of the 2004 Rules on Notarial Practice, as amended. The Court also directed the parties or their counsel to indicate their contact details on all papers and pleadings to be filed with the Court. Records show that Atty. Manaois received a copy of the Resolution on 6 January 2009.⁴⁸ No compliance was ever submitted.

In a Resolution⁴⁹ dated 28 January 2009, the Court additionally required Atty. Manaois to submit, within five days from notice, a) proof of authority of petitioners Erlinda Dacanay and Leonardo Caguioa to sign the verification of the petition and the certification against forum shopping for and on behalf of other petitioners; and b) the verification of the petition and certification against forum shopping, and an affidavit of service, both with properly accomplished jurat. Records show that Atty. Manaois received a copy of the Resolution on 3 April 2009.⁵⁰ No compliance was ever submitted.

In a Resolution⁵¹ dated 25 November 2009, the Court resolved to 1) require petitioners to file a consolidated reply; 2) require Atty. Manaois to show cause why he should not be disciplinarily dealt with or held in contempt of court for failure to comply with the Resolutions dated 3 December 2008 and 28 January 2009; and 3) require Atty. Manaois to comply with both Resolutions within 10 days from notice. Records show that Atty. Manaois received a copy of the Resolution on 1 February 2010.⁵² No reply to the show cause order was ever submitted.

In a Resolution⁵³ dated 14 April 2010, the Court imposed on Atty. Manaois a fine of F2,000 to be paid within ten days, required him to file a consolidated reply, and to comply with the Resolution dated 25 November 2009. Records show that he received a copy of the Resolution on 18 June 2010.⁵⁴ChanRoblesVirtualawlibrary

In a Resolution⁵⁵ dated 21 March 2011, the Court imposed an additional P1,000 fine, with a warning that should he fail to pay the fine and submit a Consolidated Reply, he shall be ordered arrested and detained by the National Bureau of Investigation.

It was only on 22 June 2011, more than a year after the Court had issued the order, that Atty. Manaois paid the fine and submitted the Consolidated Reply.⁵⁶ No explanation for the delay was given to the Court.

In a Resolution⁵⁷ dated 3 August 2011, the Court required Atty. Manaois to update his IBP membership dues and to submit proof thereof within five days from notice. To date, he has yet to comply with that order.

The unexplained and repeated failure of Atty. Manaois to heed Our orders leads Us to question his fitness and commitment to remain as an officer of the court.

WHEREFORE, the petition is GRANTED. The Resolution dated 8 September 2008 and Order dated 13 October 2008 issued by the Regional Trial Court of Lingayen, Pangasinan, Branch 69, in Civil Case No. 18857 are REVERSED and SET ASIDE. Let the records of the case be REMANDED to that court, which is DIRECTED to proceed with the case with dispatch.

The Commission on Bar Discipline-Integrated Bar of the Philippines is DIRECTED to investigate Atty. Eugenio F. Manaois for his acts that appear to have violated the Lawyer's Oath and the Code of Professional Responsibility and, thereafter, to SUBMIT its report and recommendation to this Court.

SO ORDERED.chanroblesvirtuallawlibrary

Leonardo-Decastro, Bersamin, Perlas-Bernabe, and Caguioa, JJ., concur.

Endnotes:

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¹Rollo, pp. 95-99; Penned by Judge Ma. Susana T. Baua.

² Id. at 113

³ Id. at 32-38.

⁴ Id. at 113; Order dated 13 October 2008.

⁵ Id. at 55-60.

⁶ Id. at 16-17.

⁷ Id. at 44-45.

⁸ Id. at 50.

⁹ Id. at 47.

¹⁰ Id. at 49.

¹¹ Id. at 55.

¹² Id. at 57-58.

¹³ Id. at 37.

¹⁴ Id.

¹⁵ Id.

¹⁶ Id. at 48,

¹⁷ Id. at 34-35.

¹⁸ Id. at 35.

¹⁹ Id. at 36.

²⁰ Id. at 65-68.

²¹ Id. at 67-68.

²² Id. at 67.

²³ See id. at 69-76.

²⁴ Id. at 61-64.chanrobleslaw

²⁵ Id. at 62.

²⁶ Id. at 63,

²⁷ Id. at 87-93.

²⁸ Id. at 88.

²⁹ Id. at 101-109.

³⁰ Id. 23-25.

³¹ Id. at 23.

³² Id. at 29.

³³ Id. at 235-236.

³⁴ In a Resolution dated 4 March 2009; id at 237.

³⁵ Id. at 235.

³⁶ Id. at 238-240.

³⁷ Id. at 239.

³⁸ Id. at 238-239.

³⁹ Id. at 242-244.

⁴⁰ Id. at 246.

⁴¹ChanRoblesVirtualawlibrary

See Mesina v. CA, G.R. No. 100228, 13 July 1994, 234 SCRA 103; Estate of Vda. de Panlilio v. Dizon, 562 Phil. 518 (2007).�

⁴² 710 Phil. 235 (2013)

⁴³ Id.

⁴⁴Rollo, p. 23.

⁴⁵ Id. at. 99.

⁴⁶ Section 1 of Rule 139-B of the Rules of Court states that proceedings for the disbarment, suspension, or discipline of attorneys may be taken by the Supreme Court motu propio. The Court has exercised this power in several cases. See Co v. New Prosperity Plastic Products, G.R. No. 183994, 30 June 2014, 727 SCRA 503 and Mallari v. Government Service Insurance System 624 Phil 700 (2010).

⁴⁷Rollo, p. 8.

⁴⁸See Reply of the Postmaster to the letter of the Clerk of Court dated 18 May 2009; id at 254

⁴⁹ Id. at 229,

⁵⁰ See Registry Return Receipt; id. at 230-A.

⁵¹ Id. at 256.

⁵²See Registry Return Receipt; id. at 256-A.

⁵³ Id. at 258.

⁵⁴ Id. at 259.

⁵⁵ Id. at 266.

⁵⁶ Id. at 272-286.�

⁵⁷ Id. at 289.