Title
Navarro vs. Metropolitan Bank and Trust Company
Case
G.R. No. 165697
Decision Date
Aug 4, 2009
A wife challenges fraudulent property mortgage by her husband, but her claims are barred by laches and res judicata, upheld by the Supreme Court.

Case Summary (G.R. No. 165697)

Procedural History

The case revolves around two petitions for review on certiorari filed by the Navarro spouses, challenging the Court of Appeals' July 8, 2004 decision which dismissed Clarita's complaint in Civil Case No. 02-079. The complaint was aimed at having the title to the properties declared null and sought reconveyance of a portion belonging to the conjugal partnership.

Factual Background

Antonio and Clarita were married on December 7, 1968, and acquired three parcels of land covered by Transfer Certificates of Title (TCT) Nos. 155256, 155257, and 155258. In 1998, MBTC foreclosed a mortgage on these properties, which Antonio had secured for a loan. Clarita eventually filed a case in the Regional Trial Court (RTC) alleging that the mortgage and subsequent foreclosure sale were executed without her knowledge and consent, claiming that the properties were part of the conjugal partnership.

Initial Court Rulings

Clarita's first action, Civil Case No. 99-177, was dismissed by the Court of Appeals on the basis of laches, citing that she failed to pursue her claim in a timely manner—specifically taking 11 years from the registration of TCTs to initiate the lawsuit. Following this, Clarita filed a second action in 2002, Civil Case No. 02-079, which was also subject to dismissal on similar grounds. MBTC contended that this second case was barred by the prior decision in Civil Case No. 99-177.

Trial Court and Appeal Decisions

The RTC initially denied MBTC's motion to dismiss Civil Case No. 02-079, asserting that the prior dismissal did not constitute a judgment on the merits. However, this decision was challenged by MBTC, leading to the Court of Appeals ultimately ruling in favor of MBTC and ordering the dismissal of Civil Case No. 02-079. The Court of Appeals determined that since both cases shared identical issues, Clarita's second complaint should also be dismissed on the basis of laches.

Legal Analysis

Petitioners Antonio and Clarita argue that the Court of Appeals erred in its dismissal, claiming that the prior dismissal was not an adjudication on the merits due to the failure to challenge or include an indispensable party, Belen. Clarita also posited that laches could not apply to her claims concerning the nullity of the mortgage. In contrast, MBTC argued that the finality of the dismissal in the first case precluded any further action concerning the same issues.

The Supreme Court underscored the immutability of final judgments, adhering to the principle that once a decision has become final, it cannot be revised or challenged except under specific circumstances. The

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