THIRD
DIVISION
A.
G. DEVELOPMENT CORPORATION,
Petitioner,
G. R. No. 111662
October 23, 1997
-versus-
HONORABLE
COURT OF APPEALS,HONORABLE
IGNACIO CAPULONG,Presiding Judge, Regional
Trial Court of
Makati,
Branch 134,
NATIONAL
HOUSING AUTHORITY,
and A. FRANCISCO
REALTY AND DEVELOPMENTCORPORATION,
Respondents.
D
E C I S I O N
ROMERO, J.:
Challenged in
this petition for review under
Rule 45 of the Rules of Court is the decision of respondent Court of
Appeals
in CA G. R. S. P. No. 30227 which upheld the order of the Regional
Trial
Court [RTC], Branch 134, Makati, dismissing petitioner's complaint on
the
ground of the lack of jurisdiction. The pertinent facts are as follows:
On November 4,
1981, petitioner A.G. Development
[AGDC] and public respondent National Housing Authority [NHA] entered
into
a "Memorandum of Agreement"[1]
wherein the former agreed to construct on its lot a
dormitory-apartment-commercial
building for the latter at a total cost of Eleven Million Four Hundred
Fifty Two Thousand Nine Hundred Eighty Nine Pesos [P11,452,989.00].
Pursuant
to the agreement, AGDC executed in favor of NHA a promissory note[2]
and a real estate mortgage[3]
over the land as a security for the obligation. Thereafter, NHA made an
initial payment of three million three hundred eight thousand four
hundred
forty [P3,308,440.00] to AGDC to cover a portion of the contract price.cralaw:red
On August 30,
1983, however, NHA rescinded the
agreement and demanded the immediate return of the initial amount paid
on the ground that AGDC was not able to complete the project on time.
The
demand was refused, as a result of which, the real estate mortgage was
extra-judicially foreclosed and the property sold to NHA as the highest
bidder. The one-year period to redeem having expired, a new Transfer
Certificate
of Title [T.C.T.] was issued in favor of NHA; thereafter, a writ of
possession
was applied for and granted by the Regional Trial Court of Quezon City
docketed as LRC Case No. 3067 [85].cralaw:red
On December 3,
1986, AGDC filed a complaint against
NHA before the Makati RTC docketed as Civil Case No. 15495 for breach
of
contract, declaration of nullity of the promissory note and real estate
mortgage, and annulment of foreclosure sale and reversion of possession
and title. NHA filed a motion to dismiss on the ground of litis
pendentia,
which was denied by the trial court. While the case was pending,
private
respondent A. Francisco Realty and Development Corp. [AFRDC] filed a
motion
to intervene claiming that it is an innocent purchaser for value of the
subject property since it had already bought the foreclosed property
from
NHA.[4]
Consequently,
AFRDC filed a motion to dismiss
before the Makati RTC, reasoning that the said court has no
jurisdiction
to entertain the complaint and annul the writ issued by the Quezon City
RTC since both are co-equal or coordinate jurisdiction. The Makati RTC
ruled in favor of AFRDC and dismissed AGDC's complaint.[5]
Recourse to the Court of Appeals proved futile. Hence, this petition.
In resolving the instant petition, the
principal
issue to be addressed is whether the issuance of a writ of possession
by
the Quezon City RTC constitutes res judicata as to bar the
complaint
filed by AGDC.cralaw:red
It is an
oft-repeated rule that for res judicata
to apply, the following requisites must concur:
a) the former judgment must be final;
b) the court which rendered it had
jurisdiction
over the subject matter and the parties;
c) the judgment must be on the merits;
and
d) there must be between the first and
second
actions identity of parties, subject matter and causes of action.[6]
Although not
explicitly stated, a basic requisite
for res judicata to apply is that there are two cases which have been
decided
on the merits.
In affirming the
Makati RTC's dismissal of AGDC's
complaint, the Court of Appeals ruled that the issuance of the writ of
possession has the effect of confirming the title of NHA over the
property
in question.[7]
As such, the grant of said writ constitutes an absolute bar to a
subsequent
action. It is final as to the claim of nullity of the promissory note,
real estate mortgage and the resultant extra-judicial foreclosure sale.
We cannot agree with the Court of Appeals that the action to annul both
the real estate mortgage and the foreclosure sale is barred by res
judicata.cralaw:red
The issuance of a
writ of possession is not a
judgment on the merits. A writ of possession is generally understood to
be an order whereby the sheriff is commanded to place a person in
possession
of a real or personal property,[8]
such as when a property is extra-judicially foreclosed.[9]
In this regard, the issuance of a writ of possession to a purchaser in
an extra-judicial foreclosure is merely a ministerial function.[10]
As such, the Court neither exercises its official discretion nor
judgment.[11]
In other words, the issuance of the writ of possession is summary in
nature,[12]
hence the same cannot be considered a judgment on the merits which is
defined
as one rendered after a determination of which party is right, as
distinguished
from a judgment rendered upon some preliminary or formal technical
point.[13]
Furthermore, the
doctrine of res judicata applies
only to judicial or quasi-judicial proceedings and not to the exercise
of administrative powers or to legislative, executive or ministerial
determination.[14]
Accordingly,cases disposed of on technical grounds do not fall within
the
doctrine of res judicata.[15]
Hence, the issuance of the writ of possession by the Regional Trial
Court
of Quezon City was not a judgment oil the merits but simply an incident
in the transfer of title.cralaw:red
We also note that
LRC Case No. 3067 [85] is not
an action as defined by law. An action is an act by which one sues
another
in a court of justice for the enforcement or protection of a right or
the
prevention or redress of a wrong[16]
and such is commenced by filing a complaint with the Court.[17]
However, in the procedure for the issuance of a writ of possession, no
complaint is necessary, the filing of an ex parte motion being
enough.[18]
Indeed, the term "action" does not include non-judicial proceedings,
although
they are before a court, as in cases where the court does not act in a
judicial capacity.[19]
There is also
another consideration that supports
this conclusion since an extra-judicial foreclosure only requires the
posting
and publication of the notices to effect the same.[20]
It has been held that a proceeding to foreclose a mortgage by
advertisement
is not an action.[21]
In the absence of the necessary elements, the doctrine of res judicata
cannot be applied in the instant petition.cralaw:red
WHEREFORE, in
view of the foregoing, the decision
appealed from is hereby GRANTED. Civil Case No. 15495 is hereby
REINSTATED.cralaw:red
SO ORDERED.cralaw:red
Melo, Francisco
and Panganiban, JJ., concur.
Narvasa, CJ., is on leave.cralaw:red
_______________________________
Endnotes
[1]
Rollo, pp. 50-58.
[2]
Ibid., p.65.
[3]
Id., pp. 66-68.
[4]
Id., pp. 78-80.
[5]
Id., pp. 110-111.
[6]
Mangoma v. Court of Appeals, 241 SCRA 21 [1995]; Guevarra v. Benito,
247
SCRA 570 [1995]; Cokaliong Shipping Lines, Inc. v. Amin, 260 SCRA 122
[1996].
[7]
Rollo, p. 145.
[8]
Moreno, Philippine Law Dictionary, 1972.
[9]Sec. 7 of Act 3135, as amended.
[10]
Vaca v. Court of Appeals, 234 SCRA 146 [1994]; F. David Enterprises v.
Insular Bank of America, 191 SCRA 516 [1990].
[11]
Lamb v. Philipps, 22 Phil 456 [1912].
[12]
Tabios, Problems Involving A Writ of Possession, 218 SCRA 585 [1993].
[13]
Santos v. IAC, 145 SCRA 238 [1986].
[14]
50 C.J.S. 27, Section 603.
[15]
46 Am Jur 2d, Section 477.
[16]
Hagans v. Wislenzenus, 42 Phil. 880 [1922].
[17]Sec. 5, Rule 1, 1997 Rules on Civil Procedure.
[18]Sec. 7, Act 3135, as amended.
[19]
Patterson v. Murray, 53 NC 278.
[20]Sec. 3, Act 3135, as amended.
[21]
Golcher v. Brisbin, 20 Minn. 453. |