The Case
This petition for review on
certiorari[1] seeks to reverse and set aside the Order
[2]
dated May 22, 2020 of the Regional Trial Court (RTC), Branch 23, Trece
Martires City, Cavite in Civil Case No. TMCV-062-18 dismissing the
complaint of petitioner Frank Colmenar for declaration of nullity of
deeds of extrajudicial settlement of estate, deeds of sale, cancellation
of titles, and damages against respondents Philippine Estates
Corporation (PEC), Amaia Land Corporation (Amaia), Crisanta Realty
Development Corporation (Crisanta Realty), and Property Company of
Friends (ProFriends), on the ground that the complaint failed to state a
cause of action as against them. In dismissing the case, the trial
court applied the 2019 Amendments to the 1997 Revised Rules on Civil
Procedure even though it was allegedly not feasible and it caused
injustice to petitioner.
Antecedents
In his complaint
[3] filed on September 11, 2018, petitioner essentially averred:
(a) He is the second child of Filipino-born Francisco Jesus Colmenar and
American Dorothy Marie Crimmin. Their family lived in Cleveland, Ohio,
United States of America.
[4]
(b) Following his parents' divorce, his father Francisco Jesus Colmenar
returned to the Philippines. Despite the distance between him and his
father, he remained close to the latter. In fact, when his own child was
born, Francisco Jesus Colmenar visited them in Las Vegas, Nevada, where
he and his family lived. Francisco Jesus Colmenar confided in him that
he (Francisco Jesus Colmenar) had met a woman named Loida.
[5]
(c) Years later, he learned that his father had died. The latter left
real properties located at General Trias, Cavite, all registered in his
father's name,
viz.: (i) an interest in a property covered by
Transfer Certificate of Title (TCT) No. 579 with an area of 130,743 sq.
m.; (ii) an interest in the property under TCT No. 588 with an area of
806 sq. m.; (iii) half an interest in the property under TCT No. 572
measuring 27,175 sq. m.; and (iv) 1/6 interest in the property under TCT
No. 25848 with an area of 117,476 sq. m..
[6]
(d) He also learned that respondents Apollo Colmenar (Apollo), Jeannie
Colmenar Mendoza (Jeannie), and Victoria Jet Colmenar (Victoria)
executed an Extrajudicial Settlement of Estate of Francisco Jesus
Colmenar dated May 16, 2008 and another Extrajudicial Settlement of
Estate of Deceased Francisco Jesus Colmenar and Loida Colmenar dated
July 8, 2011 where they made it appear that they were the surviving
heirs of Francisco Jesus Colmenar, and by virtue thereof, allocated unto
themselves the interests of his late father in the aforesaid
properties.
[7]
(e) Apollo, Jeannie, and Victoria thereafter sold to ProFriends the
property under TCT No. 25848 on January 3, 2012; to Crisanta Realty the
property under TCT No. 572 through a Deed of Absolute Sale dated
September 21, 2012; and to PEC the property under TCT No. 579 through a
Deed of Sale dated May 22, 2013. Much later, PEC sold this property to
Amaia in whose name TCT No. 057-2013024578 was issued.
[8]
(f) These sales were made without his knowledge and consent. The
individual respondents effectively deprived him of his successional
rights under Philippine laws as a legitimate son of his late father.
Thus, he secured the services of counsel and sent demand letters to
individual respondents to invoke his successional rights. Apollo's
counsel, however, refused to meet with him. His subsequent demand
letters were also ignored.
[9]
(g) The Deeds of Sale in PEC's favor are void because the individual
respondents, not being heirs of Francisco Jesus Colmenar, had no
rightful claim and interest over the property under TCT No. 579.
Consequently, PEC also did not confer any right on Amaia when the former
sold this property to the latter.
[10] For the same reason, the sale in favor of Crisanta Realty and ProFriends are also void.
[11]
The case was docketed as Civil Case No. TMCV-062-18 and raffled to RTC-Trece Martires City, Cavite, Branch 23.
ProFriends,
[12] PEC,
[13] and Crisanta Realty
[14]
filed their respective answers. ProFriends invoked as affirmative
defense lack of cause of action, while PEC and Crisanta Realty, averred
that the complaint failed to state a cause of action against them. They
also invoked the following common defenses: (1) they are innocent
purchasers for value; and (2) petitioner's claim is barred by laches
and/or prescription.
Apollo
[15] and Amaia, on the
other hand, filed their respective motions to dismiss. Amaia, like PEC
and Crisanta Realty, averred that the complaint stated no cause of
action against it and that it was a buyer in good faith.
[16]
Crisanta Realty and PEC then filed a Motion for Leave of Court to Set
the Case for Preliminary Hearing on Affirmative Defenses (Motion for
Leave of Court).
[17]
On April 1, 2019, the trial court, through then Assisting Judge Bonifacio S. Pascua, issued an Order
[18]
granting the aforesaid motion and setting their affinnative defenses
for hearing on May 27, 2019. In the same order, the trial court deferred
the resolution of the motions to dismiss of Apollo and Amaia.
Through Order
[19] dated
December 26, 2019, however, Assisting Judge Jean Desuasido-Gill (Judge
Gill) set aside the April 1, 2019 Order and deemed PEC and Crisanta
Realty's Motion for Leave of Court, as well as Apollo and Amaia's
respective motions to dismiss, submitted for resolution.
On February 12, 2020, Judge Gill issued an Omnibus Order
[20] denying these motions,
viz.:
MOTIONS TO DISMISS
Anent the Motion to Dismiss filed by Defendants Apollo Colmenar (Apollo)
and Amaia Land Corporation (Amaia), the Court hereby DENIES said
Motions. The issues raised by the Defendants are complex and the matters
raised are evidentiary, which can be best threshed out during trial.
Defendants Apollo and Amaia are directed to file their Answer within ten
(10) days from receipt hereof.
MOTIONS TO HEAR AFFIRMATIVE DEFENSES
The Court exercises its discretion under Section 1, Rule 16 of the Rules
of Court to DENY the Motion to Hear Affirmative Defenses. The issues
raised in this case by each party are complex. The affirmative defenses
raised by defendants Crisanta Realty Development Corporation (Crisanta)
and Philippine Estates Corporation (PEC) are matters better threshed out
in trial.[21]
x x x x
PEC,
[22] Crisanta Realty,
[23] and Amaia
[24] filed their respective motions for reconsideration. At the same time, Amaia filed its Answer
[25]
pleading anew its affirmative defenses that the complaint failed to
state a cause of action against it, it was an innocent purchaser for
value, and petitioner's claim had prescribed.
Meantime, the 2019 amendment to the Rules of Court took effect on May 1, 2020.
Thereafter, the trial court, still through Judge Gill, issued the assailed Order dated May 22, 2020,
[26]
dismissing the complaint as against PEC, Crisanta Realty, Amaia, and
ProFriends on ground that the complaint failed to state a cause of
action against them.
[27] Judge Gill stated that she applied Section 12, Rule 8 of the 2019 Amendments to the Revised Rules on Civil Procedure, thus:
For comment and resolution of the Court are the Affirmative
Defenses filed by: Philippine Estates Corporation (PEC), Amaia Land
Corporation (Amaia), Crisanta Realty Development Corporation (Crisanta),
and Property Company of Friends, Inc. (Profriends).
They are being resolved in consonance with Rule 8 Section 12,
particularly par. (a) and (c) of the 2020 Amendments to the 1997 Rules
of Civil Procedure, which took effect on May 1, 2020. As per this new
provision, the Court shall motu proprio resolve the affirmative
defense if claim [sic] allegedly states no cause of action, among
others. The Court marries the case status with the new provision.[28]
x x x x
The Court rules to DISMISS the Complaint vs. PEC and AMAIA.
Nowhere in the Complaint did Plaintiff allege that Defendant PEC is a
purchaser in bad faith or that it has notice of the defect in the title
of Defendants Siblings Colmenar.
In a complaint for recovery of ownership of real property, the Supreme Court held that:
Where the complaint for recovery of ownership and possession
of a parcel of land alleges that some of the defendants bought said
land from their co-defendants who had a defective title thereto but does
not allege that the purchasers were purchasers in bad faith or with
notice of the defect in the title of their vendors, there is a failure
to state a cause of action.
A complaint states a cause of action if it avers the existence of the three essential elements of a cause of action, namely:
i) |
the legal right of the plaintiff; |
ii) |
the correlative obligation of the defendant; |
iii) |
the act or omission of the defendant in violation of said legal right. |
[f the allegations in the complaint do not aver the concurrence of these
elements, the complaint becomes vulnerable to a motion to dismiss on
the ground of failure to state a cause of action.
Amaia has similar arguments for dismissal as PEC. Defendant AMAIA
purchased the subject property from PEC. The Complaint's omission to
allege that PEC and Amaia are not purchasers in good faith or that they
had notice of defect in the title of their predecessors in interest
makes the Complaint fail to state a cause of action.
An innocent purchaser for value is protected by the Torrens system of
registration under Section 53 of PD 1529. Under this section, while a
legal remedy is available for fraud perpetrators in obtaining Title to
property, the remedy is not available against an innocent purchaser for
value.
Both PEC and Amaia, the latter a company in the business of realty or
land sales, enumerated the due diligence they observed in procuring or
purchasing the subject property which are, among others: keen inspection
of titles; physical inspection of land; inspection of neighboring or
adjacent lands; inquiries in the Register of Deeds; circumspect
inspection of any defect of Title.
As PEC and Amaia are innocent purchasers for value of the subject land,
the Plaintiff loses the legal remedy that could have been afforded by
Section 53. There is no cause of action against PEC and Amaia.
Premises considered: 1/ the Complaint against Philippine Estates
Corporation is DISMISSED for lack of cause of action, sans pronouncement
as to Damages, [Attorney's] fees and Compulsory Counterclaim; 2/ PEC's
Motion for Reconsideration to Hear Affirmative Defenses is rendered
MOOT.
Likewise, the Complaint as against Amaia Land Corporation is hereby
Dismissed for lack of cause of action, bereft of pronouncement as to the
Counterclaim and Cross-claim.
Crisanta Realty Development Corporation
Crisanta's Affirmative Defenses strongly echo PEC's.
Crisanta's Affirmative Defenses of No Cause of Action against it AND innocent purchaser for value displayed the same narrative in PEC's affirmative defense.
The Court reached the same conclusions: 1/ the Complaint against
Crisanta Realty Development Corporation is DISMISSED for lack of cause
of action, sans pronouncement as to Damages, [Attorney's] fees and
Compulsory Counterclaim; 2/ Crisanta's Motion for Reconsideration to
Hear Affirmative Defenses is rendered MOOT.
Property Company of Friends, Inc.
Profriends Affirmative Defense relied on No cause of action.
Profriends alleged that although it is being impleaded in the Complaint
as a purchaser of the parcel of land previously covered by TCT No.
25848, it allegedly has no obligation insofar as plaintiff is concerned.
Plaintiff failed to provide in its Complaint factual and legal basis
for the prayer of cancellation of the Deed of Sale in Profriend's favor,
as well as the new TCT issued under it, as a result of the sale.
Again, the Court finds no cause of action against Profriends to support the Complaint.
Profriends is a purchaser in good faith, the property it bought is covered by the Torrens Title.
The Court reiterates the discussion in PEC's and Amaia's cases above, as
conclusive ground for dismissal of the Complaint against Profriends.
Wherefore, the Complaint against Property Company of Friends, Inc. is
DISMISSED for lack of cause of action, bereft of pronouncement as to the
Compulsory Counterclaim.
FINAL ORDERS:
Preceding any progression of this case, in order to be consistent with
the 2020 Amendments to the Rules of Civil Procedure, particularly Rule 7
Section 6 (b) and (c) the Court orders the Plaintiff to file within a
non-extendible period of thirty (30) days from receipt hereof: 1/ a
summary of its witnesses and their intended testimonies; 2/ the judicial
affidavits of the said witnesses; 3/ true copy of the documentary
evidence and object evidence of all the allegations to support the
claim, if none filed, as suppletory to its initial pleading.
Let this case be set for a possible marking of Exhibits and true
copy of documents, including Judicial Affidavits of Plaintiffs witnesses
on Tuesday, June 30, 2020 @ 1:15 o'clock in the afternoon in the
Courtroom of RTC Branch 23, Trece Martires City. This case will be heard
face to face.
The Court stands pat on the Default Order against Defendants Jeannie
Colmenar Mendoza and Victoria Jet Colmenar, and strongly NOTES the
non-Answer of Defendant Apollo A. Colmenar, despite Court Order of
February 12, 2020. The period for Apollo A. Colmenar to file Answer has
lapsed.
So Ordered.[29]
Noticeably, the inclusion of the name of ProFriends was erroneous since
ProFriends actually pleaded a different affirmative defense - lack of
cause of action.
In light of the proscription against filing a motion for reconsideration under Section 12, Rule 15
[30]
of the 2019 Rules on Civil Procedure and in view of the singular
question of law purportedly involved, petitioner directly sought relief
from the Court.
The Present Petition
Petitioner now seeks affirmative relief from the Court against the
assailed Order dated May 22, 2020. He faults Judge Gill for applying the
2019 Rules on Civil Procedure to the case, and based thereon,
motu proprio acted on the affirmative defenses of respondent companies despite the clear injustice it caused to him.
[31]
He asserts that although admittedly procedural rules may be applied to
actions already pending prior to their effectivity, the 2019 Amendments
expressly proscribe their application to pending actions when "
in the
opinion of the court, their application would not be feasible or would
work injustice, in which case the procedure under which the cases were
filed shall govern."
[32] Here, Judge Gill
motu proprio
acted on and granted the affirmative defenses of respondent companies
despite previously denying them through her Omnibus Order dated February
12, 2020. This hasty turn-about caused him great prejudice as he was
peremptorily deprived of the opportunity to assert his claim against
respondent companies. More so considering the trial court's earlier
pronouncement that the issues presented could be better threshed out
through a full dressed trial. Worse, he could not even seek a
reconsideration from the assailed disposition because Section 12, Rule
15 of the 2019 Amendments prohibits the filing of a motion for
reconsideration of court actions on affirmative defenses.
[33]
Petitioner further posits that Judge Gill had earlier ruled on the
affirmative defenses through her Omnibus Order dated February 12, 2020.
The pending matters at the time the 2019 Amendments took effect were
respondent companies' motions for reconsideration of the February 12,
2020 Omnibus Order. If Judge Gill was truly insistent on applying the
new rules in the case, she should have denied the motions for
reconsideration pursuant to Section 12(e), Rule 8 of the 2019 Amendments
which prohibits the filing of a motion for reconsideration where an
affirmative defense is denied.
[34]
Further, by
motu proprio resolving the affirmative defenses,
Judge Gill totally disregarded the requirement set forth under Section
12(c), Rule 8 of the 2019 Amendments that the court "
shall motu proprio resolve the above affirmative defenses within thirty (30) calendar days from the filing of the answer."
ProFriends filed its answer with affirmative defense as early as
December 2018; PEC and Crisanta Realty, on January 3, 2019; and Amaia on
February 27, 2020. Thus, when she resolved their respective affirmative
defenses on May 22, 2020, she did so way beyond the 30-day period
provided under the 2019 Amendments.
[35]
Lastly, Judge Gill gravely erred when she decreed that the complaint
failed to state a cause of action as against respondent companies in
view of the absence of a material allegation that they were purchasers
in bad faith or had notice of a defect in the sellers' titles. In truth,
the complaint bears the material allegations that petitioner is the
heir of Francisco Jesus Colmenar, the registered owner of the properties
which were sold to respondent companies by Apollo, Jeannie, and
Victoria, who were not heirs of Francisco Jesus Colmenar. A purchaser
may be impleaded in an action if said purchaser acquired the property
from a seller who had no right over the said property.
The Roman Catholic Bishop of Tuguegarao v. Prudencio,
[36]
decreed that a transferee's claim of good faith does not preclude a
cause of action against it. Thus, the lack of specific allegation in the
complaint that respondent companies acquired the properties in bad
faith does not equate to failure to state a cause of action against
them.
[37]
In their Comment dated January 22, 2021,
[38]
PEC and Crisanta Realty aver that the petition must be dismissed since
it actually raises a question of fact. For petitioner is asking the
Court to evaluate the allegations in the complaint and determine whether
the same make out a case against respondent companies, which is
basically a question of fact, thus, outside the purview of Rule 45 of
the Revised Rules of Court.
[39]
Contrary to petitioner's claim, Judge Gill did not err in applying the
2019 Rules on Civil Procedure to the case for Rule 144 of the Rules
itself clearly ordains that the same may be applied to all pending
proceedings. In fact, Judge Gill had consistently applied the 2019 Rules
in all proceedings before her court.
[40]
In any event, Judge Gill was correct in holding that the complaint
failed to state a cause of action against them. Petitioner, indeed, did
not allege in his complaint that they are purchasers in bad faith or
that they had notice of any defect in the titles of the properties they
bought from individual respondents who are also children of Francisco
Jesus Colmenar, albeit, from a different wife. In effect, the complaint
failed to state the particular right, if any, which they supposedly
violated. They were innocent purchasers for value. They exercised the
required diligence when they investigated the property before buying it.
Their diligent investigation did not yield anything suspicious about
the properties and their corresponding titles.
[41]
For its part, Amaia reiterates the arguments in its Comment
[42]
dated January 25, 2021 that the complaint indeed failed to state a
cause of action against it. The complaint did not bear any allegation
that respondent companies were purchasers in bad faith. As innocent
purchasers for value, they are protected by law.
[43]
Also, the trial court was correct when it applied the 2019 Amendments
and acted on respondent companies' affirmative defenses. The 2019
Amendments clearly uses the word "shall" to qualify its effectivity
provision, hence, it applies as well to pending cases.
[44]
On the other hand, ProFriends, in its Comment
[45]
dated January 29, 2021, also faults petitioner for improperly raising
here a mixed question of fact and law, which is not allowed under Rule
45. Petitioner should have gone first t() the Court of Appeals in
consonance with the rule on the hierarchy of courts.
[46]
Issues
1. Does the petition raise pure questions of law?
2. Did the trial court commit reversible error when it applied the 2019
Amendments to the 1997 Revised Rules on Civil Procedure (now known as
the 2019 Rules of Procedure) to resolve the affirmative defenses pleaded
by respondent companies?
3. Did the trial court commit reversible error when it dismissed the
complaint against respondent companies on ground that it failed to state
a cause of action against them?
Ruling
The petition raises pure questions of law.
The issues for resolution are:
First. Did the trial court commit reversible error when it
applied the 2019 Amendments to resolve the affirmative defenses pleaded
by respondent companies, albeit the case was already pending when the
2019 Amendments took effect?; and
Second. Assuming the allegations in the complaint to be true, does the complaint state a cause of action against respondent companies?
A "question of law" exists when the doubt hinges on what the law is on a
certain set of facts or circumstances; on the other hand, there is a
"question of fact" when the issue raised on appeal pertains to the truth
or falsity of the alleged facts. The test for determining whether the
supposed error was one of "law" or "fact" is not the appellation given
by the parties raising the same; rather, it is whether the reviewing
court can resolve the issues raised
without evaluating the evidence,
in which case, it is a question of law; otherwise, it is one of fact.
In other words, where there is no dispute as to the facts, the question
of whether the conclusions drawn from these facts are correct is a
question of law. If the question posed, however, requires a
re-evaluation of the credibility of witnesses, or the existence or
relevance of surrounding circumstances and their relationship to each
other, the issue is factual.
[47]
Here, the first question of whether the trial court committed reversible
error when it applied the 2019 Amendments to resolve the affirmative
defenses pleaded by the respondent companies, albeit the same was
already pending when these Amendments took effect is one of law. In
Central Realty and Development Corp. v. Solar Resources, Inc.,
[48]
the Court held that the issue of whether the trial court correctly
applied a specific law or rules to a particular case is a question of
law,
viz.:
Was the denial of petitioner's motion for judgment on the
pleadings correct? Is Solar's action for specific performance barred by res judicata?
Is summary judgment in the case proper? These are precisely the
questions being raised here. The resolution of these questions rests
solely on what the law or the rules provides on the given set of
circumstances. In other words, the Court ought to look only into
whether the trial court correctly applied the law or rules in the case.
These are pure questions of law which do not require the examination of
evidence. (Emphasis supplied)
As for the second issue, whether the allegations in the complaint,
assuming them to be true, state a cause of action against respondent
companies is also one of law. The Court stressed in
Bases Conversion Development Authority v. Reyes,
[49]
that where there is no dispute as to the facts, the question of whether
the conclusions drawn from these facts are correct is a question of
law. Indeed, in resolving whether the complaint here, based on its
allegations, states a cause of action against respondent companies, the
Court need not re-evaluate the credibility of any witnesses or the
veracity of any evidence. The Court only needs to examine the complaint
itself, the allegations of which are assumed to be true, in order to
determine whether the complaint states a cause of action against
respondent companies for declaration of nullity of deeds of
extrajudicial settlement of estate, deeds of sale, cancellation of
titles, and damages against respondent companies. To repeat, this is a
pure question of law.
In fine, petitioner's direct resort to the Court is in accordance with Rule 45, which ordains:
Section 1. Filing of petition with Supreme Court - A
party desiring to appeal by certiorari from a judgment, final order or
resolution of the Court of Appeals, the Sandiganbayan, the Court of Tax
Appeals, the Regional Trial Court or other courts, whenever authorized
by law, may file with the Supreme Court a verified petition for review
on certiorari. The petition may include an application for a writ of
preliminary injunction or other provisional remedies and shall raise
only questions of law, which must be distinctly set forth. The
petitioner may seek the same provisional remedies by verified motion
filed in the same action or proceeding at any time during its pendency.
As held in
Daswani v. Banco de Oro,
[50]
when only questions of law remain to be addressed, a direct recourse to
the Court under this remedy is the proper mode of appeal.
We now resolve the case on the merits.
The trial court gravely
erred when it applied the 2019 Amendments to resolve the affirmative
defenses pleaded by respondent companies |
|
The 2019 Amendments have been incorporated into the 1997 Revised Rules
on Civil Procedure, now known as the 2019 Rules on Civil Procedure. And
as with all things new, precedence is generally scarce, hence, its
application must be done with utmost caution and in strict adherence to
its provisions.
Rule 144 of the 2019 Rules, provides:
The 2019 Proposed Amendments to the 1997 Rules of Civil
Procedure shall govern all cases filed after their effectivity on May 1,
2020, and also all pending proceedings, except to the extent that in
the opinion of the court, their application would not be feasible or
would work injustice, in which case the procedure under which the cases were filed shall govern. (Emphasis supplied)
As worded, the 2019 Amendments shall also govern all pending cases commenced before they took effect on May 1, 2020,
except
to the extent that in the opinion of the court, their application would
not be feasible or would work injustice, in which case, the procedure
under which the cases were filed shall govern. Here, the case
commenced with the filing of the complaint in September 2018 and
remained pending when the 2019 Amendments took effect.
As it was, Judge Gill applied Section 12, Rule 8 of the 2019 Amendments when she supposedly resolved
motu proprio the affirmative defense of respondent companies, that is, the complaint failed to state a cause of action, thus:
Section 12. Affirmative defenses. - (a) A defendant shall
raise his or her affirmative defenses in his or her answer, which shall
be limited to the reasons set forth under Section 5(b), Rule 6, and the
following grounds:
- That the court has no jurisdiction over the person of the defending party;
- That venue is improperly laid;
- That the plaintiff has no legal capacity to sue;
- That the pleading asserting the claim states no cause of action; and
- That a condition precedent for filing the claim has not been complied with.
(b) |
Failure to raise the affirmative defenses at the earliest opportunity shall constitute a waiver thereof. |
|
|
(c) |
The court shall motu proprio resolve the above affirmative defenses within thirty (30) calendar days from the filing of the answer. (Emphasis supplied) |
The records though readily show that when Judge Gill
motu proprio
resolved the affirmative defenses on May 22, 2020, the prescribed
thirty (30) day period had long expired. ProFriends filed 1ts answer
with affirmative defense
[51] in December 2018; PEC
[52] and Crisanta Realty
[53] on January 3, 2019; and Amaia
[54]
on February 27, 2020. Judge Gill should have, therefore, desisted from
applying the 2019 Amendments to the case below, specifically Section 12,
Rule 8 thereof, because when she did, the same was no longer feasible.
Another. It was inaccurate for Judge Gill to say that she was
motu proprio
acting on the affirmative defenses. In truth, she had already resolved
this common affirmative defense of failure to state a cause of action,
together with the other affirmative defenses in her Omnibus Order dated
February 12, 2020. There, she denied the motions to dismiss and motions
to set the affirmative defenses for hearing because in her words, "
the issues x x x are complex x x x and are x x x better threshed out in trial."
[55]
Too, PEC, Crisanta Realty, and Amaia all had pending motions for
reconsideration of the Omnibus Order dated February 12, 2020 when Judge
Gill "
motu proprio" resolved their common affirmative defense,
and dismissed the case based on, and consequently considered the pending
motions for reconsiderations as moot. Thus, instead of applying the
2019 Amendments, Judge Gill could have simply resolved the pending
motions for reconsiderations of PEC, Crisanta Realty, and Amaia.
But this is not all. The worst part is when Judge Gill ignored the
injustice caused by the application of the 2019 Amendments to the case.
For as a consequence, petitioner lost his substantial right to be heard
on the common affirmative defense of PEC, Crisanta Realty, and Amaia,
and his right to seek a reconsideration of the order of dismissal which
were both granted him under the 1997 Revised Rules on Civil Procedure.
This brings us to the third and last issue:
did the complaint fail to state a cause of action against respondent companies?
The complaint stated a cause of action against respondent companies |
|
To recall, there are two (2) sets of affirmative defenses raised below,
viz.:
(1) the complaint failed to state a cause of action, raised by PEC,
Amaia, and Crisanta Realty; and (2) lack of cause of action, raised by
ProFriends.
In the Omnibus Order dated February 12, 2020, Judge Gill did not resolve
the affirmative defense of lack of cause of action raised by
ProFriends. She only resolved the common affirmative defense of PEC,
Amaia, and Crisanta Realty that the complaint failed to state a cause of
action. And yet, in the assailed Order dated May 22, 2020, the case
against ProFriends was also dismissed on the ground that the complaint
failed to state a cause of action, the common affirmative defense raised
only by PEC, Amaia, and Crisanta Realty.
[56]
It has been repeatedly held, however, that failure to state a cause of action and lack of cause of action
are distinct and separate grounds to dismiss a particular action.
Zuniga-Santos v. Santos-Gran[57]
explained that failure to state a cause of action refers to the
insufficiency of the allegations in the pleading, while lack of cause of
action refers to the insufficiency of the factual basis for the action.
Dismissal for failure to state a cause of action may be raised at the
earliest stages of the proceedings through a motion to dismiss under
Rule 16 of the 1997 Rules of Court or raised as an affirmative defense
in an answer, while dismissal for lack of cause of action may be raised
any time
after the questions of fact have been resolved on the basis of stipulations, admissions or evidence presented by the plaintiff.
Asia Brewery, Inc. v. Equitable PCI Bank[58] further explained:
Failure to state a cause of action is not the same as lack of cause of action; the terms are not interchangeable.
It may be observed that lack of cause of action is not among the
grounds that may be raised in a motion to dismiss under Rule 16 of the
Rules of Court. The dismissal of a Complaint for lack of cause of action
is based on Section 1 of Rule 33, which provides:
Section 1. Demurrer to evidence. - After the plaintiff has
completed the presentation of his evidence, the defendant may move for
dismissal on the ground that upon the facts and the law the plaintiff
has shown no right to relief. If his motion is denied he shall have the
right to present evidence. If the motion is granted but on appeal the
order of dismissal is reversed he shall be deemed to have waived the
right to present evidence.
If the Complaint fails to state a cause of action, a motion to
dismiss must be made before a responsive pleading is filed; and the
issue can be resolved only on the basis of the allegations in the
initiatory pleading. On the other hand, if the Complaint lacks a cause of action, the motion to dismiss must be filed after the plaintiff has rested its case.
In the first situation, the veracity of the allegations is immaterial;
however, in the second situation, the judge must determine the veracity
of the allegations based on the evidence presented.
x x x x
Hence, in order to resolve whether the Complaint lacked a
cause of action, respondent must have presented evidence to dispute the
presumption that the signatories validly and intentionally delivered the
instrument.
x x x x
The test to determine whether a complaint states a cause of action
against the defendants is this: admitting hypothetically the truth of
the allegations of fact made in the complaint, may a judge validly grant
the relief demanded in the complaint?[59] (Emphasis supplied)
Consequently, the trial court erred in dismissing the complaint against
ProFriends on ground that the complaint failed to state a cause of
action, an affirmative defense it did not raise, and which is completely
different from what it actually raised,
i.e., lack of cause action. And strictly speaking, lack of cause of action may only be raised
after
the questions of fact have been resolved on the basis of stipulations
or admissions or evidence presented by the plaintiff. Before then, it
cannot be raised as a ground for dismissal; much less can the court
dismiss the case on that ground.
We now go to the dismissal of the complaint against PEC, Amaia, and
Crisanta Realty on the ground that the complaint failed to state a cause
of action against them.
A cause of action is defined as an act or omission by which a party violates a right of another.
[60]
A complaint states a cause of action if it sufficiently avers the
existence of the three (3) essential elements of a cause of action,
namely: (a) a right in favor of the plaintiff by whatever means and
under whatever law it arises or is created; (b) an obligation on the
part of the named defendant to respect or not to violate such right; and
(c) an act or omission on the part of the named defendant violative of
the right of the plaintiff or constituting a breach of the obligation of
defendant to the plaintiff for which the latter may maintain an action
for recovery of damages. If the allegations of the complaint do not
state the concurrence of these elements, the complaint becomes
vulnerable to a motion to dismiss on the ground of failure to state a
cause of action.
[61]
Here, the complaint for declaration of nullity of Deeds of Extrajudicial
Settlement of Estate, Deeds of Sale, Cancellation of Titles, and
Damages alleges:
1. Plaintiff Frank Colmenar x x x is the legitimate son of the late Francisco Jesus Colmenar (Deceased) and Dorothy Marie Crimmin (Dorothy).[62]
x x x x
28. Years later, Plaintiff learned of the unfortunate demise of his father.[63] x x x
x x x x
29. Upon his death, Deceased left real properties registered under his name, to wit:
(1) |
An interest in a real property located in General Trias, Cavite, with an area of 130,743 square meters then covered by Transfer Certificate of Title No. 579; |
|
|
(2) |
One-half (1/2) interest in a real property
located in General Trias, Cavite, with total area of 27,175 square
meters then covered by Transfer Certificate of Title No. 572; |
|
|
(3) |
One-sixth (1/6) interest in a real property
located in General Trias, Cavite with a total land area of 117,476
square meters then covered by Transfer Certificate of Title No. 25848; and |
|
|
(4) |
An interest in a real property located in General Trias, Cavite with a total land area of 806 square meters then covered by Transfer Certificate of Title No. 588. |
30. Several years later, Plaintiff learned that Defendants Apollo,
Jeannie, and Victoria made it appear that they were the heirs of the
Deceased in the Extrajudicial Settlement of Estate dated 16 May 2008 involving a real property then covered by Transfer Certificate of Title No. T-579 registered in the name of the Deceased, and a portion of a real property covered by Transfer Certificate of Title No. T-572 registered in the name of the Deceased and Angel Colmenar, both properties being located at General Trias, Province of Cavite.
31. Defendants Apollo, Jeannie, and Victoria committed the same misrepresentations when they executed the Extrajudicial Settlement of the Estates of Deceased Francisco Colmenar and Loida Colmenar dated 8 July 2011 involving a real property then covered by Transfer Certificate of Title No. 579 issued in the name of the Deceased and another real property covered by Transfer Certificate of Title No. 25848 in the name of the Deceased, among others, both properties being located at General Trias, Province of Cavite.
32. Using the foregoing deeds of extrajudicial settlement of estate as authority, Defendants Apollo and Jeannie executed a Deed of Absolute Sale dated 22 May 2013 in favor of Defendant PEC covering a real property then covered by Transfer Certificate of Title No. 579 issued in the name of the Deceased. For her part, Defendant Victoria, executed a Deed of Absolute Sale dated 22 May 2013 in favor of Defendant PEC covering a real property with Transfer Certificate of Title No. 579 issued in the name of the Deceased.
32.1. Subsequently, Defendant PEC sold the property covered by Transfer Certificate of Title No. 579 to Defendant Amaia, which by then was already covered by Transfer Certificate of Title No. 057-2013024578 in the name of Defendant PEC.
33. In the same manner, Defendants Apollo. Jeannie, and Victoria executed a Deed of Sale dated 12 September 2012 in favor of Defendant Crisanta, covering a real property then covered by Transfer Certificate of Title No. 943212 issued in the name of the Deceased and a Deed of Absolute Sale dated 3 January 2012 in favor of Defendant Profriends covering a portion of a real property then covered [by] Transfer Certificate of Title No. 25848 in the name of the Deceased, among others.
34. All the actions of Defendants Apollo, Jeannie and Victoria were made
without the knowledge and consent of Plaintiff. Worse, said Defendants
did the same depriving Plaintiff of his successional rights under
Philippine laws as the legitimate son of the Deceased.[64]
x x x x
47. However, Defendant PEC did not earlier acquire any right or interest over the property since the Deeds of Absolute Sale executed by Defendants Apollo, Jeannie and Victoria are void.
47.1. The said deeds are void since Defendants Apollo, Jeannie, and Victoria had no interest over the property covered by Transfer Certificate of Title No. 579. Hence, they had no right to sell the same to Defendant PEC.
48. Despite not having acquired any right or interest over the property covered by Transfer Certificate of Title No. 579, Defendant PEC still subsequently sold the said property to Defendant Amaia x x x[65]
x x x x
54. Subsequently, or on 21 September 2012, Defendants Apollo, Jeannie
and Victoria executed a deed of sale involving the property covered by
Transfer Certificate of Title No. 943212 in favor of Defendant Crisanta.
55. It bears stressing, however, that Defendants Apollo, Jeannie, and
Victoria are not [the] heirs of the Deceased. Therefore, they had no
right to dispose of the property covered by Transfer Certificate of Title No. 943212 in favor of Defendant Crisanta.[66]
x x x x
60. Defendants Apollo, Jeannie and Victoria subsequently sold Francisco Colmenar's share in Transfer Certificate of Title No. 25848 to Defendant Profriends.
61. It bears stressing, however, that Defendants Apollo, Jeannie, and
Victoria are not [the] heirs of the Deceased. Therefore, they had no
right to dispose of the property covered by Transfer Certificate of Title No. 25848 in favor of Defendant Profriends.[67]
x x x x
64. On account of the Deeds of Extrajudicial Settlement of Estate and void Deeds of Absolute Sale executed by Defendants Apollo, Jeannie, and Victoria, Transfer Certificate of Title Nos. 579, 943212, 25848 were cancelled.
65. To reiterate, however, Defendants Apollo, Jeannie, and Victoria had
no right to transfer the properties to Defendant corporations.
66. Consequently, the titles issued by Defendant Registry of Deeds under
the name of Defendant Amaia, which originated from the title issued to
Defendant PEC, should be cancelled. In the same manner, the titles
issued by the Defendant Registry of Deeds to Defendants Crisanta and
Profriends are earnestly requested to be cancelled.[68]
In essence, petitioner essentially avers that: (a) he is the legitimate
son and lawful heir of Francisco Jesus Colmenar; (b) his father left
real properties in the Philippines, the rights and interests of which
would legally pass on to his heirs upon his death; (c) the individual
respondents are not the lawful heirs of Francisco Jesus Colmenar, thus,
have no claim to the properties left by the latter; (d) the individual
respondents, nonetheless, despite being devoid of any right in or
authority over the estate of his father, were able to effect a void
extrajudicial settlement of his father's estate, and thereafter, a void
sale of his father's properties in favor of respondent companies, which,
as a consequence, also did not acquire a valid title hereto.
In
Asia Brewery, Inc. v. Equitable PCI Bank[69]
the Court ordained that the test to determine whether a complaint
states a cause of action against the defendants is - admitting
hypothetically the truth of the allegations of fact made in the
complaint, may a judge validly grant the relief demanded in the
complaint?
Here, assuming the foregoing allegations to be true, petitioner as
legitimate child and lawful heir of Francisco Jesus Colmenar has the
right to the relief prayed for.
i.e., to declare as void the
extrajudicial settlement of estate effected by the individual
respondents who, not being lawful heirs of his father, had no legal
right to settle the estate; and to declare as void the subsequent deeds
of sale executed by these individual respondents in favor of respondent
companies which consequently also did not derive any valid title from
the individual respondents.
In
Unciano v. Gorospe[70]
the Court underscored the fundamental principle that no one can give
what he does not have. In other words, a seller may sell only what he or
she owns, or that which he or she does not own but has authority to
transfer, and a
buyer can acquire only what the seller can legally transfer. As the Court emphasized in
Daclag v. Macahilig,
[71]
in a contract of sale, it is essential that the seller is the owner of
the property he is selling. Under Article 1458 of the New Civil Code,
the principal obligation of a seller is to transfer the ownership of the
property sold. Article 1459 of the same provides that the thing must be
licit and the vendor must have a right to trar.sfcr the ownership
thereof at the time it is delivered.
Nool v. Court of Appeals,
[72]
further enunciated Article 1505 of the New Civil Code which provides
that "where goods are sold by a person who is not the owner thereof, and
who does not sell them under authority or with consent of the owner,
the buyer acquires no better title to the goods than the seller had,
unless the owner of the goods is by his conduct precluded from denying
the seller's authority to sell."
Hence, whether respondent companies were buyers in bad faith or had
knowledge of the defect in the title of the seller is not the issue nor
the trigger that gave rise to the complaint. Petitioner's causes of
action hinged on his averment that the individual respondents are not
the owners of the properties, hence, they cannot validly sell the same
to respondent companies, nor convey any title to the latter by reason of
the invalid sale. The spring cannot rise above its source. Needless to
state, the trial court cannot inject its own theory to take the place of
the actual allegations in the complaint. Besides, where petitioner in
this case has no actual or personal knowledge of the good faith or bad
faith of the buyers in the purchase of the properties, how could he
possibly allege it in the complaint? In any event, good faith or lack of
bad faith is a matter of defense for the buyers in this case. It can be
pleaded in the answer and proved during the trial.
As enunciated in
Sindophil, Inc. v. Republic,
[73] the presumption that a holder of a Torrens title is an innocent purchaser for value is
disputable and may be overcome by contrary evidence, thus:
Sindophil insists that it bought the Trame property from Ty
in good faith and that it was an innocent purchaser for value. However,
the presumption of good faith and that a holder of a title is an
innocent purchaser for value may be overcome by contrary evidence.
Here, the Republic presented evidence that TCT No. 10354, from which
Sindophil's TCT No. 132440 was derived, was void. As found by the
Regional Trial Court:
Record shows that Certificate of Title No. 6735, wherein the
lot claimed by defendant, Marcelo R. Teodoro, lot 3270-B, is derived
therefrom, is under the name of the Republic of the Philippines, dated
October 17, 1913. Nothing in the subsequent annotations was under the
name of any of the defendants and neither the subject TCT No. 10354.
With the Republic having put forward evidence that the Tramo property
claimed by Sindophil belongs to the Republic, the burden of evidence
shifted to Sindophil to prove that its title to it was valid.
Concomitantly, it had the burden of proving that it was indeed a buyer
in good faith and for value. As this Court said in Baltazar v. Court of Appeals, "the burden of proving the status of a purchaser in good faith and for value lies upon him who asserts that status"
and "[i]n discharging that burden, it is not enough to invoke the
ordinary presumption of good faith, i.e., that everyone is presumed to
act in good faith. The good faith that is [essential here] is integral
with the very status which must be proved." (Emphasis supplied)
In any event, the trial court's reliance on
Spouses Castillo v. Heirs of Madrigal[74] is utterly misplaced. It is not on all fours with the present case.
Spouses Castillo
involved a conveyance of property registered in the names of the
Castillo Siblings. The conveyance appeared to have been executed by all
the registered co-owners, albeit the plaintiffs later disclaimed their
participation in the conveyance and sued for recovery of possession and
ownership. Meantime the property had already been conveyed from the
original buyer to a company who invoked the right of an innocent buyer
for value. The Court ruled:
Where the complaint for recovery of ownership and possession
of a parcel of land alleges that some of the defendants bought said
land from their co-defendants who had a defective title thereto but does
not allege that the purchasers were purchasers in bad faith or with
notice of the defect in the title of their vendors, there is a failure
to state a cause of action. By reason of this failure, private
respondent Susana Realty, Inc. is presumed to be an innocent purchaser
for value and in good faith, entitled to protection under the law.[75]
Here, the allegations in the complaint do not speak of co-ownership
between petitioner and the individual respondents insofar as the subject
properties are concerned. There is no allegation either that the
corresponding certificates of title which the respondent individuals
transacted with respondent companies bore all the names of the
respondent individuals, as well as the name of petitioner himself as
their co-owner. Nor is there any allegation that the deeds of sale
executed in favor of respondent companies were signed not only by
individual respondents but also by petitioner himself, all of them being
supposedly co-owners of the properties. On the contrary, the
allegations in the complaint, assuming them to be true, are all about
the unlawful conveyances of the properties by the respondent individuals
who had no right to do so since the true and lawful owner of these
properties is petitioner, no other.
All told, the trial court gravely erred when it held that the complaint
failed to state a cause of action against respondent companies, and
based thereon, dismissed the complaint against them.
WHEREFORE, the petition is
GRANTED and the Order dated May 22, 2020 of the Regional Trial Court, Branch 23, Trece Martires, Cavite in Civil Case No. TMCV-062-18
REVERSED and SET ASIDE. The Complaint is
REINSTATED
as against Philippine Estates Corporation, Crisanta Realty Development
Corporation, Amaia Land Corporation, and Property Company of Friends.
The trial court is
DIRECTED to
PROCEED with the resolution of the case with
UTMOST DISPATCH.
SO ORDERED.
Perlas-Bernabe, (Senior Associate Justice), M. Lopez, Rosario, and
J. Lopez,
** JJ., concur.
* Francisco Colmenar's full name is "Francisco Jesus Colmenar."
** Designated as additional member per Special Order No. 2822 dated April 7, 2021.
[1] Rollo, pp. 11-45.
[2] Penned by Assisting Judge Jean Desuasido-Gill,
id. at 54-58.
[3] Id. at 60-78.
[4] Id. at 60-61 and 65.
[5] Id. at 66-67.
[6] Id. at 67-68.
[7] Id. at 68.
[8] Id. at 68-69 and 73-74.
[9] Id. at 69-70.
[10] Id. at 72-73.
[11] Id. at 73-75.
[12] Id. at 159-166.
[13] Id. at 244-273.
[14] Id. at 289-317.
[15] Apollo's motion was not attached to the petition. Neither was its content mentioned in the petition or any of its annexes.
[16] Id. at 169-192.
[17] Id. at 329-332.
[18] Id. at 358.
[19] Id. at 359-361.
[20] Id. at 362-364.
[21] Id. at 363.
[22] Id. at 365-382.
[23] Id. at 386-403.
[24] Id. at 406-420.
[25] Id. at 421-450.
[26] Id. at 54-58.
[27] Id. at 56-58.
[28] Id. at 54.
[29] Id. at 56-58.
[30] Section 12.
Prohibited motions.
- The following motions shall not be allowed: x x x (c) Motion for
reconsideration of the court's action on the affirmative defenses; x x
x.
[31] Rollo, p. 29.
[32] Id. at 31-32.
[33] Id. at 33-34.
[34] Id. at 34-35.
[35] Id. at 35-36.
[36] 794 Phil. 462 (2016).
[37] Rollo, pp. 36-43.
[38] Id. at 482-508.
[39] Id. at 490-494.
[40] Id. at 494-500.
[41] Id. at 500-507.
[42] Id. at 628-655.
[43] Id. at 644-653.
[44] Id. at 639-644.
[45] Id. at 677-682.
[46] Id. at 678-680.
[47] Republic v. Gallo, 823 Phil. 1090, 1102 (2018), citing
Spouses Miano v. Manila Electric Co., 800 Phil. 118, 122 (2016).
[48] G.R. No. 229408, November 9, 2020.
[49] 711 Phil. 631, 638-639 (2013).
[50] 765 Phil. 88, 97 (2015).
[51] Rollo, pp. 159-166.
[52] Id. at 244-272.
[53] Id. at 289-317.
[54] Id. at 421-448.
[55] Id. at 363.
[56] Id. at 363.
[57] See 745 Phil. 171, 177-178 (2014); also see
Aquino v. Quiazon, 755 Phil. 793, 808 (2015).
[58] 809 Phil. 289 (2017).
[59] Id. at 297, 299.
[60] Spouses Chu v. Benelda Estate Development Corporation, 405 Phil. 936, 946 (2001).
[61] Zuniga-Santos v. Santos-Gran, supra note 57, at 180.
[62] Rollo, pp. 60-61.
[63] Id. at 67.
[64] Id. at 67-69.
[65] Id. at 72-73.
[66] Id. at 74.
[67] Id. at 75.
[68] Id. at 75-76.
[69] Supra note 58, at 299.
[70] G.R. No. 221869, August 14, 2019.
[71] 582 Phil. 138, 153 (2008).
[72] 342 Phil. 106, 117-118 (1997).
[73] G.R. No. 204594, November 7, 2018.
[74] 275 Phil. 605 (1991).
[75] Id. at 612.