Title
National Coconut Corporation vs. Geronimo
Case
G.R. No. L-2899
Decision Date
Apr 29, 1949
NCC's good faith possession of Sagrada Orden's property ended after court nullified sale; liable for damages post-demand to vacate.

Case Summary (G.R. No. L-2899)

Background of the Dispute

The controversy arose from a complaint filed by the Sagrada Orden de Predicadores before the Municipal Court of Manila, alleging illegal possession of property by the National Coconut Corporation. The central issue was whether the possession of the property by the Philippine Alien Property Custodian, and consequently its transfer to the National Coconut Corporation, was in good faith. The complaints allege that the property was sold to a Japanese corporation by the respondent, which was subsequently declared null and void by the court.

Good Faith Possession

The court found that the possession by the Philippine Alien Property Custodian and later the National Coconut Corporation was in good faith, as defined by Articles 434, 435, 436, and 1950 of the Civil Code. Good faith possession generally allows a possessor to enjoy the benefits derived from the property, including the fruits produced, unless legally interrupted. The judgment declaring the sale to the Japanese corporation void only retroactively affected the nature of the possession after it was rendered.

Possession and Its Legal Consequences

According to Article 451 of the Civil Code, the fruits received by a possessor acting in good faith are rightfully theirs until a legal interruption occurs. In this case, the court determined that the possession of the petitioner was not interrupted by the mere filing of the complaint, as the Philippine Alien Property Custodian had no prior knowledge of defects in the sale. The legal character of possession only became questionable upon the judgment declaring the previous transfer void.

Timing and Jurisdiction

The timing of events played a critical role in the court's decision. The petitioner’s possession remained legal until they were explicitly notified by the Sagrada Orden de Predicadores to vacate the premises. The completion of that notification marked the start of the obligation to compensate for the use of the property. The court also emphasized that there was less than one year between the notice to vacate and the filing of the complaint for illegal detainer, thus affirming the jurisdiction of the municipal judge to adjudicate the matter.

Dissenting Opinion

In dissent, it was argued that the Sagrada Orden de Predicadores had been deprived of possession since August 1946, which precluded them from filing the complaint within the one-year statutory limit for illegal detainer cases. The dissent posited that the Municipal Court’s jurisdiction is contingent upon the actual occupancy of the premise

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