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G.R. No. 165501 - SPS. JESUS AND EVANGELINE PASCO v. PISON-ARCEO AGRICULTURAL AND DEVELOPMENT CORPORATION

G.R. No. 165501 - SPS. JESUS AND EVANGELINE PASCO v. PISON-ARCEO AGRICULTURAL AND DEVELOPMENT CORPORATION

PHILIPPINE SUPREME COURT DECISIONS

THIRD DIVISION

[G.R. NO. 165501 : March 28, 2006]

SPOUSES JESUS and EVANGELINE PASCO, Petitioners, v. PISON-ARCEO AGRICULTURAL AND DEVELOPMENT CORPORATION, Respondent.

D E C I S I O N

CARPIO MORALES, J.:

From the Court of Appeals August 27, 20031 decision which denied their Petition for Review of the decision of the Bacolod City Regional Trial Court (RTC) affirming with modification that of the June 30, 2000 of the Talisay City Municipal Trial Court in Cities (MTCC), Spouses Jesus and Evangeline Pasco (petitioners) brought the case to this Court on a Petition for Review on Certiorari.

Respondent, Pison-Arceo Agricultural and Development Corporation, is the registered owner of a parcel of land containing more than 100 hectares covered by Transfer Certificate of Title (TCT) No. T-88078 of the Register of Deeds of Negros Occidental.

Constructed on respondent's parcel of land are houses which are occupied by its workers.

Petitioners, among other workers, used to work for respondent until 1987. They having ceased to be employed by respondent, petitioners were asked to vacate the house they were occupying but they refused, hence, respondent filed a complaint for unlawful detainer against them before the MTCC in Talisay City.

In their Answer to the Complaint,2 petitioners claimed that, inter alia, they built the house occupied by them at their own expense and their stay on the land was upon the tolerance of respondent.

In their Position Paper,3 petitioners claimed that respondent constructed houses for its workers but the house they were occupying was destroyed by a typhoon, forcing them to build their house; respondent's demand was merely for them to vacate the house, as they had paid rentals thru salary/wage deductions; and their refusal to vacate the house is justified, they being the owners and actual possessors thereof.

By Decision of June 30, 2000,4 the MTCC of Talisay rendered judgment in favor of respondent upon the following findings:

As adduced, it is explicitly clear that [respondent] provided housing facilities to every worker in its hacienda without a requiring payment of rentals, however, with an implied promise that the same be vacated upon their cessation from work. . . .

On the issue that [petitioners] were responsible in building their own houses is devoid of merit. . . . However, [petitioners] made repairs on their houses when [the] same were destroyed by typhoon sometime in 1975. These are repairs badly needed at that time there being no however express authority from [respondent].

x x x

As to the contention of [petitioners] in Civil Case No. 677, [respondent] is amenable to remove whatever improvements they have introduced thereto including the trees they planted. . . .

x x x x (Underscoring supplied)5

Accordingly, the MTCC disposed as follows:

WHEREFORE, judgment is hereby rendered for [respondent] and herein [petitioners in Civil Case No. 677], spouses Jesus Pasco and Evangeline Pasco . . .and those persons claiming under their names are hereby ordered:

1. To vacate the premises of [respondent's] Lot 707, Talisay Cadastre covered by Transfer Certificate of Title No. T-88078 and to remove whatever improvements they introduced thereon;

2. To pay [respondent] the sum of P50.00 a month as rental payment from the time of the filing of the herein complaint until they have vacated the premises; andcralawlibrary

3. To pay the sum of P5,000.00 as attorney's fees.

SO ORDERED.6 (Underscoring supplied)cralawlibrary

After the promulgation on June 30, 2000 of the MTCC decision or on August 23, 2000, the Municipal Agrarian Reform Office (MARO) of Talisay City sent a Notice of Coverage and Field Investigation7 (Notice of Coverage) advising respondent that its parcel of land is now covered under Republic Act 6657 otherwise known as the Comprehensive Agrarian Reform Law (CARL), and inviting the presence of a representative to a field investigation to be conducted on September 12, 2000 during which it (respondent) may pinpoint its retained area in accordance with Section 6 of the CARL.

In the meantime, as petitioners appealed the MTCC decision in the Unlawful Detainer Case to the RTC, they, on August 24, 2000, filed a Memorandum of Appeal8 contending that the MTCC:

I. . . . . ERRED IN FINDING THE [PETITIONERS] TO BE BUILDERS, PLANTERS OR SOWERS IN BAD FAITH.

II. . . . . ERRED IN NOT FINDING [RESPONDENT] TO BE OWNERS IN BAD FAITH.

III. . . . . ERRED IN APPLYING ARTICLES 449 TO 451 OF THE CIVIL CODE.

IV. . . . . HAS NO JURISDICTION OVER THE COMPLAINT UNTIL [PETITIONERS] RIGHT OF RETENTION UNTIL ARTICLE 546 OF THE CIVIL CODE HAS EXPIRED.

x x x x9

In their Memorandum, petitioners argued that respondent's hacienda is covered by the CARL and they are qualified beneficiaries thereunder; whether they are qualified beneficiaries is material to the determination of whether they are planters or builders or sowers in bad faith; "upon knowledge that the land subject of the unlawful detainer case is a[n] hacienda, it is within the sound discretion of the judge to clarify from the parties whether or not the subject land is covered by [CARL] and whether or not the defendants are qualified agrarian reform beneficiaries"; "it is mandatory on the part of the courts to take judicial notice of agrarian laws"; and the unlawful detainer case, at all events, was prematurely filed as respondent's right to eject them would arise only after they are reimbursed of

their expenses in repairing the house and, therefore, the MTCC has no jurisdiction yet to order their ejectment.

By Decision of December 5, 2000,10 the RTC of Bacolod City affirmed the June 30, 2000 decision of MTCC Talisay, with modification, disposing as follows:

WHEREFORE, the decision rendered by the Municipal Trial Court in Cities, dated June 30, 2000 is hereby modified as follows:

"WHEREFORE, judgment is hereby rendered for [respondent] . . . . against spouses Jesus Pasco and Evangeline Pasco and the persons claiming under their names are hereby ordered:

1. To vacate the premises of [respondent's] Lot 707, Talisay Cadastre covered by Transfer Certificate of Title No. T-88078 and to remove the house they constructed thereon;

2. To pay [respondent] the sum of P50.00 a month as rental payment from the time of the filing of the herein complaint until they have vacated the premises; andcralawlibrary

3. To pay the sum of P5,000.00 as attorney's fees.

With costs against the [petitioners].11 (Underscoring supplied)cralawlibrary

Petitioners moved to reconsider12 the RTC decision, they contending that the MTCC had no jurisdiction over the complaint for unlawful detainer in view of the agrarian dispute between them and respondent; and by Order13 of June 8, 2001, petitioners' motion for reconsideration was denied. Hence, they elevated the case to the Court of Appeals14 before which they raised, in the main, the issues of:

I. . . .

A. Whether or not the Notice of Coverage issued by DAR and which was ADMITTED by [respondent's] sufficient evidence to prove that [respondent's] land is covered by CARP.

B. Whether or not [petitioners'] evidence to prove that they are potential agrarian reform beneficiaries has been existing at the time of the filing of the complaint for ejectment against them.

II. WHETHER OR NOT THERE IS AN AGRARIAN DISPUTE BETWEEN THE PARTIES IN CIVIL CASE NO. 677 SO AS TO NULLIFY THE PROCEEDINGS IN THE MUNICIPAL TRIAL COURT IN CITIES FOR LACK OF JURISDICTION.

x x x x

AND

WHETHER OR NOT THE APPELLATE COURT ERRED IN NOT DISMISSING RESPONDENT'S COMPLAINT FOR EJECTMENT, HAVING BEEN BROUGHT BY A PARTY WHO IS NOT THE REAL PARTY-IN-INTEREST.15 (Underscoring supplied)cralawlibrary

To their petition before the appellate court, petitioners attached a copy of the Notice of Coverage and Field Investigation sent by the MARO, Talisay City to respondent.

In the meantime, the MARO of Talisay City issued on August 24, 2004 a Certification16 that herein petitioner Jesus Pasco is registered as potential Comprehensive Agrarian Reform Program (CARP) beneficiary in the land owned by respondent.

By the assailed Decision of August 27, 2003,17 the appellate court denied petitioners' petition, ratiocinating as follows:

Well settled is the rule that the only issue in ejectment cases is the physical possession of the premises, independent of any claim of ownership by the parties, and this must be so because the issue of ownership cannot be definitely decided in an ejectment case. Considering that the petitioners were in possession of the subject property by sheer tolerance of its owners, they knew that their occupation of the premises may be terminated any time. Persons who occupy the land of another at the latter's tolerance or permission, without any contract between them is necessarily bound by an implied promise that they will vacate the same upon demand, failing in which a summary action for ejectment is the proper remedy against them. In the instant case, the petitioners admitted in their Answer almost all the allegations in the complaint. Since the petitioners occupy the subject land at the owner's tolerance, they are bound to vacate the same, failing which, an ejectment suit is the proper remedy against them.

We agree with the allegations of the respondent corporation that the petitioners' defenses: (1) that the subject land is covered by CARP; (2) that there is an agrarian dispute; and (3) that the case is not brought by a real party-in-interest are mere afterthoughts to muddle the case and win at all costs. These issues were not raised before the trial court. The fact is that the petitioners had admitted from the very start that the respondent is the owner of the lot in question. They are therefore in estoppel if they deny the fact the complaint was brought by the real party-in-interest. In the same manner, the defense that the court has no jurisdiction over the ejectment case because of an agrarian dispute or the land is covered by CARP is likewise untenable. Basic is the rule that the material averments in the complaint, which in this case is for ejectment, determine the jurisdiction of the court. And, jurisprudence dictates that the court does not lose its jurisdiction over an ejectment case by the simple expedient of a party raising as a defense therein the alleged existence of a tenancy relationship between the parties. Moreover, it is a settled rule that no question will be raised on appeal unless it has been raised in the court below.

Anent the allegation that the respondent is not the real party in interest, the same deserves scant consideration. Even granting that there is indeed a co-ownership over a portion of the subject land, the law says that anyone of the co-owners may bring an action in ejectment. Thus, the respondent (plaintiff) is unquestionable a real party in interest.18 (Emphasis and underscoring supplied)cralawlibrary

Hence, the petition at bar19 assailing the appellate court's decision upon the following issues:

1. Whether or not one who has been identified by the Department of Agrarian Reform (DAR) as potential agrarian reform beneficiary may be ejected from the land where he is identified as such, by the landowner, who has already been notified by the DAR of the coverage of his land by the Comprehensive Agrarian Reform Program of the government.

2. Whether or not the foregoing issue involves an issue affecting the jurisdiction of the court over the nature of the action or it involves primary jurisdiction.

3. Whether or not the matters involving jurisdiction of the court over the nature of the action could be raised for the first time on appeal.20 (Underscoring supplied)cralawlibrary

As reflected above, the theory of petitioner before the MTCC is different from that proffered before the RTC. Thus, before the MTCC, they claimed that the house they are occupying was built at their own expense.

Before the RTC, they raised for the first time that, they being qualified beneficiaries of the CARP, the same should be considered in determining whether they are builders, planters, or sowers in good faith. And, for the first time too, they assailed the MTCC's lack of jurisdiction over the action due to prematurity, they contending that respondent's right to eject them would accrue only after they are reimbursed of their expenses in the repair of the house.

In their motion for reconsideration of the RTC decision, petitioners this time argued that the MTCC had no jurisdiction over the case in view of the agrarian dispute between them and respondent.

As a rule, a party who deliberately adopts a certain theory upon which the case is tried and decided by the lower court will not be permitted to change theory on appeal. Points of law, theories, issues and arguments not brought to the attention of the lower court need not be, and ordinarily will not be, considered by a reviewing court, as these cannot be raised for the first time at such late stage. Basic considerations of due process underlie this rule.21

The aforecited rule is not without exception, however. As correctly argued by petitioners, though not raised below, the issue of lack of jurisdiction over the subject matter may be considered by the reviewing court as it may be raised at any stage of the proceedings.22

The issuance during the pendency of the case of a Notice of Coverage to respondent does not, however, automatically make the ejectment case an agrarian dispute over which the Department of Agrarian Reform Adjudication Board (DARAB) has jurisdiction.23 The issuance of a Notice of Coverage is merely a preliminary step for the State's acquisition of the land for agrarian reform purposes and it does not automatically vest title or transfer the ownership of the land to the government. The purpose of a Notice of Coverage is explained by this Court, thus:

. . . The Notice of Coverage shall also invite the landowner to attend the field investigation to be scheduled at least two weeks from notice. The field investigation is for the purpose of identifying the landholding and determining its suitability for agriculture and its productivity. . . . The date of the field investigation shall also be sent by the DAR Municipal Office to representatives of the L[and] B[ank] [of the] P[hilippines], BARC, DENR and prospective farmer beneficiaries. The field investigation shall be conducted on the date set with the participation of the landowner and the various representatives. . . . Should there be a variance between the findings of the DAR and the LBP as to whether the land be placed under agrarian reform, the land's suitability to agriculture, the degree or development of the slope, etc., the conflict shall be resolved by a composite team of the DAR, LBP, DENR and DA which shall jointly conduct further investigation. . . .

Clearly then, the notice requirements under the CARL are not confined to the Notice of Acquisition set forth in Section 16 of the law. They also include the Notice of Coverage first laid down in DAR A.O. No. 12, Series of 1989 and subsequently amended in DAR A.O. No. 9, Series of 1990 and DAR A.O. No. 1, Series of 1993. This Notice of Coverage does not merely notify the landowner that his property shall be placed under CARP and that he is entitled to exercise his retention right; it also notifies him, pursuant to DAR A.O. No. 9, Series of 1990, that a public hearing shall be conducted where he and representatives of the concerned sectors of society may attend to discuss the results of the field investigation, the land valuation and other pertinent matters. Under DAR A.O. No. 1, Series of 1993, the Notice of Coverage also informs the landowner that a field investigation of his landholding shall be conducted where he and the other representatives may be present.

x x x x24 (Underscoring supplied)cralawlibrary

Since during a field investigation the DAR and Land Bank of the Philippines would make a determination as to whether, among other things, "the land will be placed under agrarian reform, the land's suitability to agriculture," a Notice of Coverage does not ipso facto render the land subject thereof a land reform area. The owner retains its right to eject unlawful possessors of his land, as what respondent did in the present case.ςηαñrοblεš  Î½Î¹r†υαl  lαω  lιbrαrÿ

As for the registration of petitioners as potential CARP beneficiaries, the same does not help their cause. As "potential" CARP beneficiaries, they are included in the list of those who may be awarded land under the CARP. Nothing in the records of the case shows that the DAR has made an award in favor of petitioners, hence, no rights over the land they occupy can be considered to have vested in their favor in accordance with Section 24 of the CARL which reads:

Section 24. Award to Beneficiaries. - The rights and responsibilities of the beneficiary shall commence from the time the DAR makes an award of the land to him, which award shall be completed within one hundred eighty (180) days from the time the DAR takes actual possession of the land. Ownership of the beneficiary shall be evidenced by a Certificate of Land Ownership Award, which shall contain the restrictions and conditions provided for in this Act, and shall be recorded in the Register of Deeds concerned and annotated on the Certificate of Title. (Emphasis and underscoring supplied)cralawlibrary

Moreover, to allow petitioners to continue to stay in respondent's land on the ground that they are potential CARP beneficiaries would give them preferential treatment over other potential CARP reform beneficiaries who are not occupying the premises and still awaiting the award to be made by the DAR in their favor. Worse, to further tolerate petitioners' occupancy of respondent's land might give other potential CARP beneficiaries the wrong signal that they too can occupy the land which may be awarded to them even before they are chosen or before an award is made in their favor.

WHEREFORE, the petition is DENIED for lack of merit.

No pronouncement as to costs.

SO ORDERED.


Endnotes:


1 Penned by Justice Delilah Vidallon-Magtolis and concurred in by Justices Mercedes Gozo-Dadole and Rosmari D. Carandang; CA rollo, pp. 207-212.

2 Records, pp. 16-17.

3 Id. at 40-47.

4 Id. at 61-66.

5 Id. at 63-64.

6 Id. at 66.

7 Court of Appeals (CA) rollo, p. 123.

8 Records, pp. 84-97.

9 Ibid.

10 Id. at 129-136.

11 Id. at 135-136.

12 Id. at 137-139.

13 Id. at 173-175.

14 CA rollo, pp. 9-35.

15 Id. at 23.

16 Rollo, p. 62.

17 CA rollo, pp. 207-212.

18 CA rollo, pp. 211-212.

19 Rollo, pp. 19-30.

20 Id. at 24.

21 Bank of the Philippine Islands v. Leobrera, G.R. NOS. 137147 &137148, November 18, 2003, 416 SCRA 15, 19.

22 Del Rosario v. Bonga, G.R. No. 136308, January 23, 2001, 350 SCRA 101, 110.

23 Rule II, Section 1 of the DARAB Rules provides that the DARAB shall have primary jurisdiction, both original and appellate, to determine and adjudicate all agrarian disputes, cases, controversies, and matters or incidents involving the implementation of the Comprehensive Agrarian Reform Program under Republic Act No. 6657, Executive Order Nos. 229, 228 and 129-A, Republic Act No. 3844 as amended by Republic Act No. 6389, Presidential Decree No. 27 and other agrarian laws and their implementing rules and regulations.

24 Roxas & Co., Inc. v. Court of Appeals, 378 Phil. 727, 770-771 (1999).

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