G.R. No. 155110 - Habagat Grill vs. DMC-Urban Property Developer Inc.

Case Summary (G.R. No. 155110)

Procedural History

Respondent filed a Complaint for Forcible Entry on March 28, 1994 (MTC Civil Case No. 1233‑D‑94). The Municipal Trial Court dismissed the complaint for lack of jurisdiction and cause of action (Decision, Aug. 6, 1998); the Regional Trial Court affirmed (Feb. 16, 1999). The Court of Appeals reversed and rendered judgment in favor of respondent, ordering removal of the restaurant, monthly compensation, and attorney’s fees. Petitioner sought review by the Supreme Court under Rule 45; the Supreme Court denied the petition and affirmed the Court of Appeals’ decision and resolution.

Applicable Law and Standards

Constitutional and procedural basis: the 1987 Constitution is the governing charter (decision date is after 1990), and the rules applied derive from the Rules of Court—notably Rule 45 (review), Rule 70 (ejectment: forcible entry and unlawful detainer), Rule 129 (judicial notice), and Rule 133 (preponderance of evidence). Controlling substantive principles referenced include the distinction between forcible entry and unlawful detainer (forcible entry requires proof of prior possession), the doctrine of judicial notice (limited to the content of laws and facts of public knowledge), and evidentiary criteria for assessing credibility and preponderance, including the “actor rule” and the factors listed in Rule 133.

Facts Material to the Decision

Respondent alleged it had lawful and peaceful possession of the lot since June 11, 1981 and that petitioner entered by “strategy and stealth” and constructed Habagat Grill on December 1, 1993, thereby depriving respondent of possession. Petitioner denied illegal entry, claimed construction in 1992, and asserted the structure was on Municipal Reservation No. 1050 (Times Beach per Presidential Proclamation No. 20). The trial court convened a three‑member relocation survey team (DMC’s engineer, DENR engineer, and petitioner’s designated engineer); petitioner failed to produce a copy of the Proclamation for the survey, and his designated engineer did not participate. The two participating engineers reported that Habagat Grill occupied 934 square meters of respondent’s lot.

Issues Presented

(1) Whether the Municipal Trial Court had jurisdiction over the forcible entry action; and (2) whether respondent stated and proved a sufficient cause of action, including proof of prior possession and correct identification of the lot on which Habagat Grill was located.

Jurisdictional Analysis and Rule 70 Requirements

Jurisdiction in ejectment (forcible entry) is determined from the allegations in the complaint. Section 1 of Rule 70 requires that the complaint allege (a) deprivation of possession by force, intimidation, threat, strategy or stealth, or unlawful withholding after termination of a possessory right; (b) prior possession; and (c) filing within one year of deprivation. The Court held that respondent’s complaint explicitly alleged prior peaceful possession since June 11, 1981, unlawful entry by strategy and stealth on or about December 1, 1993, and timely filing (March 28, 1994). Those pleaded elements were sufficient to confer jurisdiction on the MTC; failure of proof at trial does not retroactively defeat the court’s jurisdiction so long as the complaint, on its face, alleges a cause of action cognizable by that court.

Date of Entry and Evaluation of Competing Evidence

The determination of the date when petitioner entered the premises was a question of fact. The Court emphasized that appellate factual findings are generally conclusive on review under Rule 45 except where the Court of Appeals’ findings conflict with those of the courts below. The CA gave greater weight to the testimony of respondent’s real property manager, Bienamer Garcia, who testified that the restaurant was constructed on December 1, 1993. The Supreme Court endorsed that credibility assessment, applying Rule 133 factors (witnesses’ means and opportunity to know facts, interest, manner of testifying) and the “actor rule” which favors testimony of a person who, by duty or role, is in a better position to know the events. The Court found Garcia’s testimony clear, positive, and within his responsibilities as property manager, whereas petitioner’s proffered witness (Samuel Ruiz) lacked a demonstrated basis for comparable personal knowledge. Consequently, the Court concluded preponderant evidence supported the December 1, 1993 entry date, satisfying the one‑year prescription requirement.

Judicial Notice and the Proper Role of the Survey Report

The MTC took judicial notice of Presidential Proclamation No. 20 and attempted to infer the metes and bounds and situational relation of Times Beach to the subject lot, concluding the restaurant lay within the municipal reservation. The Supreme Court found that judicial notice is limited to what the law states (the existence and content of the proclamation) and does not extend to precise metes and bounds or to disputed situational facts that require proof. Because the exact boundaries and the situational relation of Times Beach to the disputed lot were central contested issues, the MTC err

Case Syllabus (G.R. No. 155110)

Case Caption, Citation and Procedural Posture

Reported at 494 Phil. 603, Third Division; G.R. No. 155110; decision dated March 31, 2005; penned by Justice Panganiban with concurrences by Sandoval-Gutierrez, Corona, Carpio-Morales, and Garcia, JJ.
Petition for Review under Rule 45 of the Rules of Court challenging the Court of Appeals (CA) Decision of April 12, 2002 and the CA Resolution of August 19, 2002 in CA-G.R. SP No. 53524.
Reliefs ordered by the assailed CA Decision (as reproduced in the record): (1) command petitioner Louie Biraogo and all persons acting for him to remove Habagat Grill and all improvements and to vacate the lot in question; (2) order petitioner to pay respondent P10,000.00 monthly compensation for occupation of the land until possession as of December 1, 1993 shall have been completely restored to respondent; and (3) order petitioner to pay respondent P10,000.00 as attorney’s fees.
The SC petition challenged the CA Decision and the denial by the CA of petitioner’s Motion for Reconsideration; the Supreme Court denied the petition and affirmed the challenged Decision and Resolution; costs against petitioner.

Facts (as found and summarized in the record)

On June 11, 1981, David M. Consunji, Inc. acquired a residential lot in Matina, Davao City covered by TCT No. T-82338 (hereafter "the lot in question").
On June 13, 1981, David M. Consunji, Inc. transferred the lot to its sister company, DMC Urban Property Developers, Inc. (DMC), in whose favor TCT No. T-279042 was issued.
DMC alleged that Louie Biraogo forcibly entered the lot and constructed the Habagat Grill in December 1993; DMC filed on March 28, 1994 a Complaint for Forcible Entry (Civil Case No. 1233-D-94, MTC Branch 4, Davao City).
The Complaint alleged that DMC possessed the lot from June 11, 1981 until December 1, 1993, and that on or about December 1, 1993 Biraogo, by strategy and stealth, unlawfully entered and constructed Habagat Grill, thereby depriving DMC of possession; reasonable rental value alleged at P10,000.00 per month.
Biraogo answered, denying illegal entry and averring that Habagat Grill was built in 1992 inside Municipal Reservation No. 1050 (Presidential Proclamation No. 20), so DMC had no cause of action.
Because location of Habagat Grill was pivotal, the MTC constituted a three-member relocation survey team: one geodetic engineer for DMC, one for Biraogo (who failed to participate properly), and one from the DENR.
Biraogo was directed to furnish a copy of Municipal Reservation No. 20 but did not comply; his designated geodetic engineer, Panfilo Jayme, did not take oath and did not participate in the survey.
The relocation survey, conducted March 30, 1998 by Engr. Edmindo Dida (DENR) and Engr. Jose Cordero (DMC’s representative), reported that Habagat Grill occupied 934 square meters of the lot in question.
The MTC rendered a Decision on August 6, 1998 dismissing the case for lack of jurisdiction and lack of cause of action.
DMC appealed to the Regional Trial Court (RTC), Branch 12, docketed Civil Case No. 26,860.98; the RTC on February 16, 1999 affirmed the MTC’s dismissal; a Motion for Reconsideration was denied April 21, 1999.
DMC appealed to the CA; the CA granted the appeal, ruled the MTC had jurisdiction, credited DMC’s witness and survey, and rendered the reliefs reproduced in the assailed Decision; petitioner then sought recourse to the Supreme Court.

Procedural Issues Raised by Petitioner (as presented in petition/memoranda)

Petitioner’s principal assertions (Memorandum):
- The MTC had no jurisdiction because petitioner’s possession and occupation of the lot where Habagat Grill was constructed began in 1992—more than one year prior to filing on April 7, 1994—and respondent (or its predecessor) had not been in prior and physical possession; respondent failed to allege prior possession in its Complaint.
- The Complaint of respondent’s predecessor failed to state a valid cause of action because the lot referred to therein was not particularly described and differed from the lot on which Habagat Grill was constructed.
Petitioner relied on testimony (Samuel Ruiz) and minutes of Urban Planning and Economic Development (UPED) hearings purporting to show construction in 1992.
Petitioner argued that the MTC properly took judicial notice of Presidential Proclamation No. 20 and that the property was part of the public domain (Times Beach), so the City—not respondent—would have cause of action.

Contentions of Respondent (as presented in memoranda and record)

Respondent contended the Habagat Grill was constructed on DMC’s lot on December 1, 1993 and that DMC had prior possession since June 11, 1981 as registered owner.
Respondent urged the CA and courts to rely on the relocation survey report (934 sq. meters on the lot in question) and on the testimony of its real property manager, Bienamer Garcia, who testified to the December 1, 1993 entry and had personal knowledge as part of his duties.
Respondent argued the UPED minutes pertained to a different establishment located 330 meters away (the Kawayan Restaurant) and were therefore immaterial to the present dispute.
Respondent maintained that the MTC erred in taking judicial notice of the metes and bounds and situational relation between the property covered by Presidential Proclamation No. 20 and the lot in question.

Ruling of the Court of Appeals (as summarized in the record)

The CA granted respondent’s appeal, holding that:
- The court of origin had jurisdiction over the Complaint for Forcible Entry.
- It gave greater weight to the testimony of respondent’s real property manager, Bienamer Garcia, that Habagat Grill was built on December 1, 1993; Garcia’s testimony was credible given his role and personal knowledge.
- The minutes of UPED hearings submitted by petitioner were immaterial because they pertained to another establishment (Kawayan Restaurant).
- The trial court improperly adjudged the subject property as part of the public domain by taking judicial notice of matters beyond the text of Presidential Proclamation No. 20; the lower court could note the existence of the proclamation but not the situational relation between that property and respondent’s land.
- The appellate court criticized petitioner for failing to present documentary evidence establishing the date of construction and for failing to show any authority to build on the pr