Title
Mirallosa vs. Carmel Development, Inc.
Case
G.R. No. 194538
Decision Date
Nov 27, 2013
Petitioner occupied property under unconstitutional P.D. 293; after its nullity, owner reclaimed land via unlawful detainer, upheld by courts, denying petitioner's good faith claim.
property owner
complaint
unlawful detainer
A

Case Summary (G.R. No. 194538)

Factual Background

The land in dispute formed part of Pangarap Village in Barrio Makatipo, Caloocan City, a consolidated parcel of roughly 156 hectares registered under Transfer Certificate of Title numbers indicated in the record and held by Carmel Farms, Inc., predecessor in interest to respondent. The lot occupied by petitioner is Lot No. 32, Block No. 73. By virtue of Presidential Decree No. 293, the titles covering the lots were declared invalid and the parcels were declared open for disposition to members of the Malacanang Homeowners Association, Inc. A memorandum reflecting that declaration was inscribed on the titles. Petitioner’s predecessor, a member of the association, took possession and built houses. After the Supreme Court in Tuason declared P.D. 293 unconstitutional and void ab initio, the Register of Deeds removed the memorandum and respondent’s title was restored. Petitioner acquired possession by an affidavit executed in his favor in 1995. Respondent made oral demands for vacation and sent a written demand in April 2002; when petitioner did not vacate, respondent filed an unlawful detainer complaint in January 2003.

Procedural History

The MeTC rendered judgment for respondent on 9 November 2007, ordering petitioner to vacate Lot No. 32 and awarding attorney’s fees and costs. Petitioner appealed to the RTC, which reversed and dismissed the complaint on 30 April 2008. Respondent appealed to the CA, which reversed the RTC and reinstated the MeTC decision on 25 May 2010. Petitioner’s motion for reconsideration in the CA was denied by resolution dated 15 October 2010. Petitioner then filed a Petition for Review on Certiorari with the Supreme Court, which was resolved by the present decision dated 27 November 2013 dismissing the petition and affirming the CA.

Issues Presented

The Court distilled the controversy into three issues: whether the MeTC had subject matter jurisdiction over the dispute; whether the Supreme Court’s ruling in Tuason could be applied against petitioner although he was not a party to that case; and whether petitioner qualified as a builder in good faith entitled to indemnity under the Civil Code.

Petitioner's Contentions

Petitioner maintained that the MeTC lacked jurisdiction because respondent lost ownership and the right to possess as early as the effectivity of P.D. 293 in 1973 and failed to act within the one-year prescriptive period for ejectment. Petitioner asserted that his possession was in color of title and that any tolerance by respondent arose only after Tuason, such that the action should have been an accion publiciana or an accion reivindicatoria rather than an action for unlawful detainer. Petitioner further invoked the doctrines of res inter alios judicatae nullum aliis praejudicium faciunt and the operative fact doctrine to argue that the declaration of unconstitutionality in Tuason should not prejudice persons not party to that case. Finally, petitioner claimed status as a builder in good faith and entitlement to reimbursement under Article 545 of the Civil Code.

Respondent's Contentions

Respondent argued that the MeTC correctly exercised jurisdiction because the case was one for unlawful detainer, the right to file being tacked to the last demand which occurred within one year of filing. Respondent relied on Tuason to show P.D. 293 was void ab initio and that the restoration of title vested ownership and the better right to possession in respondent. Respondent contended that the declaration of unconstitutionality produced no legal effect in favor of those who would invoke P.D. 293 thereafter, that the judgment in Tuason partook of an in rem character and bound successors, and that petitioner could not invoke the operative fact doctrine or res inter alios judicatae because he did not rely to his detriment on the invalid law prior to the judicial pronouncement. Respondent also denied that petitioner was a builder in good faith, noting petitioner’s acquisition of possession in 1995, years after Tuason.

Ruling of the Supreme Court

The Supreme Court dismissed the Petition for Review on Certiorari and affirmed the decision and resolution of the Court of Appeals. The Court held that the MeTC had jurisdiction because the action was one for unlawful detainer, that the declaration in Tuason applied despite petitioner not being a party to that case, and that petitioner was not a builder in good faith entitled to indemnity under the Civil Code.

Jurisdiction and Unlawful Detainer

The Court explained that an action for unlawful detainer exists where a person unlawfully withholds possession against a lessor, vendor, vendee, or other person after expiration or termination of the right to hold possession by virtue of any contract. The Court emphasized that the demand to vacate is jurisdictional and that the one-year prescriptive period is computed from the last demand. The Court found that possession which was originally permitted under P.D. 293 became unlawful upon the pronouncement in Tuason and respondent’s subsequent demand; respondent filed suit within one year of the last demand. The presence of an ownership dispute did not divest the MeTC of jurisdiction because in unlawful detainer proceedings the sole issue is physical possession and any adjudication of ownership is provisional for the purpose of resolving possession, a principle the Court applied consistently with its precedents.

Application of Tuason to Non-Parties

The Court reasoned that a law declared unconstitutional produces no legal effect and confers no right upon any person. The strict rule is that a declaration of invalidity is a total nullity and binds not only the parties but all persons; consequently, no one may invoke the invalid law in subsequent cases. The Court rejected petitioner’s reliance on res inter alios judicatae nullum aliis praejudicium faciunt, observing that the doctrine does not apply where the judgment is in rem or where the party is a successor in interest by title subsequent to the commencement of the action. The Court further held that the operative fact doctrine operates only as an equitable exception where a declaration of invalidity would unduly burden those who reasonably relied on the law, and that petitioner could not claim reliance to his detriment because his asserted authority to occupy derived from an affidavit dated 1995, years after Tuason was promulgated.

Operative Fact Doctrine and res inter alios judicatae

The Court treated the operative fact doctrine as a narrow equitable rule that recognizes interim effects of a law prior to a declaration of unconstitutionality when fairness so requires. The Court found no equitable ground to extend interim validation to petitioner because he did not reasonably rely on P.D. 293 before Tuason; his assert

...continue reading

Analyze Cases Smarter, Faster
Jur helps you analyze cases smarter to comprehend faster, building context before diving into full texts. AI-powered analysis, always verify critical details.

About Privacy Terms