A.M. No. SB-12-19-P - Civil Service Commission vs. Andal

Petitioner: Parañaque Industry Owners Association, Inc. (PIOA) represented by Patricia Sy and Rosalinda Escobilla, a nonstock corporation incorporated on March 6, 2012 (SEC Reg. No. CN201204425).
Respondents: James Paul G. Recio, Daryl Tancinco, and Marizene Tancinco.
Subject Property: A 200 sqm parcel located at Lot 5, Block 2, Champaca Extension, Light Industry Compound, UPS IV, Barangay Marcelo Green, Parañaque City, covered by Transfer Certificate of Title (TCT) No. (70115) 123145, originally issued to PIOA with SEC Reg. No. 0109189.

On November 15, 2012, petitioner filed a Complaint for unlawful detainer before the Metropolitan Trial Court (MeTC) against respondents, alleging illegal occupation of the subject property.
The property was originally allowed to be occupied by respondents’ predecessor-in-interest, the late Mario Recio, as caretaker, who built a house in 1982. However, respondents continued to occupy the property without petitioner’s consent.
Petitioner intended to use the property as its office; the water tank therein was declared dangerous in 2009, leading petitioner to demand respondents to vacate. The Office of the Building Official enjoined respondents to vacate for demolition purposes, but respondents did not comply.
Respondents denied proper personal jurisdiction and petitioner's ownership, pointing out that the registered owner was PIOA, whose SEC registration was revoked on August 11, 2003 due to noncompliance with reportorial requirements, and that petitioner incorporated only in 2012, long after the revocation.
Respondents claimed to be possessors and builders in good faith based on authorization by the former CEO of Cherith Manufacturing and President of PIOA, Mr. Richard S. Ang, who allegedly offered them the subject property and promised that improvements would be theirs.

MeTC Decision (November 8, 2013): Ruled in favor of petitioner; ordered respondents to vacate and surrender the property, pay monthly reasonable compensation starting July 30, 2012, attorney’s fees, and costs of suit. It found petitioner to have a better right of possession as the registered owner and respondents as mere tolerants.
Respondents filed a Manifestation (December 20, 2013) stating they had already vacated the premises prior to suit, thus compensation should be computed only until actual vacation.
RTC Decision (June 13, 2014): Affirmed MeTC ruling, holding respondents failed to establish possession by builder in good faith or ownership; respondents’ possession was by tolerance.
Respondents’ motion for reconsideration was denied.

CA Decision (May 11, 2018): Reversed and set aside RTC and MeTC decisions; dismissed petitioner’s complaint for unlawful detainer.
Found petitioner is not the owner of the subject property; original registered owner was PIOA, whose SEC registration was revoked in 2003, dissolving the corporation.
Noted no liquidation of PIOA’s assets was conducted; thus, corporate properties remained with dissolved PIOA and could not transfer automatically to petitioner, a new corporation formed in 2012 (distinct legal entity).
Held petitioner lacked capacity to sue as it was not the real party-in-interest; the MeTC should have dismissed the complaint for lack of cause of action.
Petitioner’s motion for reconsideration was denied (November 28, 2018).

Petitioner challenged the CA decisions via a Petition for Review on Certiorari under Rule 45 before the Supreme Court.
Respondents filed Manifestation in lower court indicating they vacated the premises, but petitioner alleged respondents never surrendered the property and padlocked the premises.

Whether the Court of Appeals correctly reversed the rulings of the MeTC and RTC, dismissing the unlawful detainer complaint filed by petitioner.
Whether petitioner is the real party-in-interest entitled to prosecute the unlawful detainer case over the subject property.