G.R. No. 15466 - Fidelity and Surety Company of the Philippines vs. Vda. de Lizarraga

The case involves a parcel of land described in Transfer Certificate of Title No. 10680, registered at the Office of the Registry of Deeds for Pasay City.
The land is described as Lot 10 of subdivision plan Psd-790 and forms part of a larger parcel originally described on plan Psu-2031-Amd. 2-A, covering an area of 662 square meters.

On December 16, 1965, spouses Julio Cruz and Zenaida Montes, then registered owners, sold a portion of the land (the northern part measuring 331 square meters) to plaintiff-appellant Cresenciano de la Cruz.

The deed of absolute sale included a stipulation that a plan be prepared for the entire parcel showing the specific portions: the 331 sq. m. conveyed and the remaining 331 sq. m. retained by the sellers.

On February 28, 1966, the same spouses sold the remaining (southern) portion of the land, also measuring 331 square meters, to Alfonso Miranda.

On April 25, 1966, Cresenciano de la Cruz filed a complaint seeking to be declared entitled to purchase, by right of pre-emption and legal redemption, the half of the land that was sold to Alfonso Miranda.
The parties agreed during pre-trial to submit the case on the pleadings, leading the lower court to dismiss the plaintiff’s complaint while granting, in the main, the defendants’ counterclaim for damages and attorneys’ fees.

The appellant contended that having acquired the northern portion of the land, he and the spouses became co-owners of the entire parcel, with adjacent, identifiable portions.
Based on the notion of co-ownership or adjoining ownership, the appellant claimed the right of pre-emption or legal redemption over the southern portion subsequently sold to Miranda.
The appellant also challenged the lower court’s decision awarding damages against him and the imposition of attorneys’ fees.

Whether the plaintiff-appellant, after buying the northern half of the land, became a co-owner of the whole parcel along with the defendants (the sellers) who owned the southern part.
Whether the concept of co-ownership applies when each party holds a distinctly determinable and identifiable portion, even if both portions are still reflected in one certificate of title.

Whether, as a co-owner or adjacent owner, the plaintiff-appellant had the right to pre-empt or redeem the portion of the land subsequently sold to Alfonso Miranda.
Whether the spatial configuration and the physical determinability of the respective portions affect the existence of a right of redemption among co-owners or adjoining owners.

Whether the trial court erred in awarding damages to the defendants based on two causes of action:

The failure of the plaintiff to prepare the subdivision plan necessary for issuing separate titles.
The alleged refusal of the plaintiff to surrender the certificate of title for annotation of a release of mortgage, thereby prejudicing the defendants.

Whether the damages were properly proved, given that allegations regarding the amount of damage are not deemed admitted without specific denial.

Whether the award of attorneys’ fees, imposed solely due to an adverse decision by the lower court, was proper.
Whether the trial court’s discretion, under the applicable provisions of the Civil Code, was abused in awarding said fees.