G.R. No. 155688 - Figuracion vs. Spouses Libi

Galileo Figuracion owned Lot No. 899-D-2, a 474 sq. m. parcel situated in Cebu City.
In 1948, Cebu City expropriated Lot No. 899-D-2 for public use by converting it into a portion of N. Escario Street, connecting the Capitol Building to Gorordo Avenue and U.P. Junior College.
Cebu City paid P23,700.00 for the lot and was issued TCT No. 49454, evidencing state title over the property.

In Resolution No. 330 dated March 20, 1989, the Cebu City Sangguniang Panlungsod approved the reconveyance of an unused portion of Lot No. 899-D-2—initially designated Lot No. 899-D-2-A—measuring 84 sq. m., to Isagani Figuracion, the successor-in-interest of Galileo Figuracion.
Based on this approval, Cebu City Mayor Tomas Osmena executed a deed of sale dated April 12, 1989 for P40,000.00, leading to the cancellation of the original TCT No. 49454 and the issuance of new titles in the names of Isagani Figuracion and Cebu City over the respective portions.
Subsequent resurvey revealed that the actual measurement of the subject lot was 130 sq. m.; therefore, the Sangguniang Panlungsod amended the reconveyance through Resolution No. 2345, and Mayor Osmena executed an amended deed of sale dated January 24, 1992 for P65,000.00.
The cancellation of the previous TCT numbers resulted in the issuance of TCT No. 122369 to Isagani Figuracion on September 30, 1992.

Respondents, Spouses Cresceniano and Amelita Libi, had been using the subject lot and refused to vacate despite being ordered to do so.
Petitioners (Natividad Figuracion, Filma Rabor, and Catherine Manalastas), as successors-in-interest of Isagani Figuracion, initiated an unlawful detainer suit (Civil Case No. R-34287) in the Municipal Trial Court (MTC) of Cebu City.
The MTC ruled in favor of petitioners on June 26, 1995, ordering respondents to remove structures (including a fence) built on the lot.
The decision was subsequently affirmed by the Regional Trial Court (RTC) on January 15, 1996, and later by the Court of Appeals (CA) on April 30, 1996.

Respondents filed a separate complaint for an easement, docketed in the RTC as Civil Case No. CEB-21193, initially seeking a right of way over the subject lot.
They amended their complaint twice, shifting their cause of action from establishing an easement to seeking the annulment of the city resolutions (Nos. 330 and 2345), the deed of sale and its amended version, and TCT No. 122369.
Cebu City defended the reconveyance, arguing that the subject lot was not used for constructing Escario Street and had been long vacant.
Petitioners countered that respondents’ complaint was barred by the earlier unlawful detainer decision (Civil Case No. R-34287) and challenged respondents’ legal standing to question the Sangguniang Panlungsod resolutions.

The RTC, in its decision in Civil Case No. CEB-21193, declared the pertinent resolutions, deeds of sale, and TCT No. 122369 as null and void.
Although Cebu City and respondents did not appeal certain rulings, petitioners brought the case to the CA, which affirmed the RTC decision in its March 20, 2002 ruling and denied petitioners’ motion for reconsideration.
Petitioners then elevated the matter to the Supreme Court by way of a Petition for Review on Certiorari under Rule 45, challenging various issues including res judicata, forum shopping, legal capacity of respondents, laches, prescription, and the denial of damages.

The issue ultimately involved the reconveyance of a public lot (a portion of Lot No. 899-D-2) expropriated for a local road, raising questions as to whether such a lot is subject to private reconveyance.
The records showed that the subject lot, though initially part of an expropriated parcel for public use, had been declared abandoned for that purpose by the city resolutions, thus paving the way for reconveyance under the right of repurchase.
The petition and subsequent litigation highlighted the fundamental conflict between a reversion action (seeking to return public land to state ownership) and a reconveyance action in favor of the former owner or its successors-in-interest.

Whether respondents, by virtue of their amended complaint seeking annulment of the titles and resolutions, possessed the legal capacity or standing to challenge the reconveyance of the subject lot.
Whether the second amended complaint filed in Civil Case No. CEB-21193 is barred by res judicata/conclusiveness of the earlier unlawful detainer decision (Civil Case No. R-34287).
Whether the respondents’ actions constitute forum shopping when shifting the cause of action from establishing an easement to seeking annulment.
Whether the annulment of Resolutions Nos. 330 and 2345, the deed of sale, amended deed of sale, and TCT No. 122369 is valid, given the public nature of the subject lot and the established right of repurchase by the former owner’s successors.
Whether the reversion of public land, as a cause of action, must be instituted in the name of the Republic of the Philippines and whether respondents were the proper parties to sue under that action.
Whether petitioners are entitled to damages as counterclaimed and if the denial of such damages was appropriate in the context of the overall litigation.