G.R. No. 200858, August 07, 2013 - NATIONAL HOUSING AUTHORITY, Petitioner, v. CORAZON B. BAELLO, WILHELMINA BAELLO-SOTTO, AND ERNESTO B. BAELLO, JR., Respondents.
G.R. No. 200858, August 07, 2013
NATIONAL HOUSING AUTHORITY, Petitioner, v. CORAZON B. BAELLO, WILHELMINA BAELLO-SOTTO, AND ERNESTO B. BAELLO, JR., Respondents.
D E C I S I O N
WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiffs and against the defendant National Housing Authority as follows:cralawlibraryThe NHA appealed the trial court’s decision to the Court of Appeals.
1. Defendant National Housing Authority and all persons and entities claiming rights under it, is (sic) ordered to surrender and turn over possession of the land embraced in Transfer Certificate of Title No. C-362547 to herein plaintiffs.
2. Defendant National Housing Authority is ordered to pay the plaintiffs reasonable compensation or fair rental value for the land, starting from the date of demand on September 21, 1993 up to the time it actually surrenders possession of the premises to the plaintiffs at the rate of Fifty Thousand Pesos (Php50,000.00) per month.
3. The defendant National Housing Authority is likewise ordered to pay as follows:cralawlibrary
(a) One Hundred Thousand Pesos (Php100,000.00) as moral damages.
(b) One Hundred Thousand Pesos (Php100,000.00) as exemplary damages.
(c) Fifty Thousand Pesos (Php50,000.00) as attorney’s fees.
4. The defendant National Housing Authority is ordered to pay the cost of suit.
SO ORDERED.9cralaw virtualaw library
WHEREFORE, foregoing considered, the appeal is hereby DENIED and the March 13, 2009 Decision of the Regional Trial Court of Caloocan City, Branch 128 in Civil Case No. C-16578 is AFFIRMED in toto.The NHA filed a motion for reconsideration.
SO ORDERED.10cralaw virtualaw library
The rule is that when material facts or questions, which were in issue in a former action and were admitted or judicially determined are conclusively settled by a judgment rendered therein, such facts or questions become res judicata and may not again be litigated in a subsequent action between the same parties or their privies regardless of the form of the latter.The Court explained further:
Jurisprudence expounds that the concept of res judicata embraces two aspects. The first, known as “bar by prior judgment,” or “estoppel by verdict,” is the effect of a judgment as a bar to the prosecution of a second action upon the same claim, demand or cause of action. The second, known as “conclusiveness of judgment,” otherwise known as the rule of auter action pendent, ordains that issues actually and directly resolved in a former suit cannot again be raised in any future case between the same parties involving a different cause of action. x x x.11cralaw virtualaw library
Conclusiveness of judgment does not require identity of the causes of action for it to work. If a particular point or question is in issue in the second action, and the judgment will depend on the determination of that particular point or question, a former judgment between the same parties will be final and conclusive in the second if that same point or question was in issue and adjudicated in the first suit; but the adjudication of an issue in the first case is not conclusive of an entirely different and distinct issue arising in the second. Hence, facts and issues actually and directly resolved in a former suit cannot again be raised in any future case between the same parties, even if the latter suit may involve a different claim or cause of action.12cralaw virtualaw libraryIn this case, the NHA’s petition is barred by conclusiveness of judgment which states that -
x x x any right, fact, or matter in issue directly adjudicated or necessarily involved in the determination of an action before a competent court in which judgment is rendered on the merits is conclusively settled by the judgment therein and cannot again be litigated between the parties and their privies whether or not the claim, demand, purpose, or subject matter of the two actions is the same.13cralaw virtualaw libraryWe sustain the Court of Appeals in ruling that the main issue raised by the NHA, which it alleged in its Answer before the trial court, is the validity of OCT No. (804) 53839. The validity of OCT No. (804) 53839 had long been settled by this Court in G.R. No. 143230. In that case, the Court ruled that the action to annul OCT No. (804) 53839 was barred by the decision in LRC Case No. 520. The Court noted that the Republic did not oppose Pedro and Nicanora’s application for registration in LRC Case No. 520, and neither did it appeal the decision. OCT No. (804) 53839 was issued by the Register of Deeds in 1959 and the Republic did not file any action to nullify the CFI’s decision until the NHA filed a complaint for nullity of OCT No. (804) 53839 on 5 November 1993, the case which was the origin of G.R. No. 143230. As pointed out by this Court in G.R. No. 143230, the NHA was already barred from assailing OCT No. (804) 53839 and its derivative titles.
On the last issue, the petitioner avers that the trial and appellate courts erred in not holding that it was a builder in good faith and the respondents as having acted in bad faith. The petitioner avers that it believed in good faith that respondents’ property was part and parcel of the Dagat-Dagatan Lagoon owned by the government, and acting on that belief, it took possession of the property in 1976, caused the subdivision of the property and awarded the same to its beneficiaries, in the process spending P45,237,000.00. It was only in 1988 when it learned, for the first time, that the respondents owned the property and forthwith petitioner filed its complaint for eminent domain against them. The petitioner further avers that even assuming that it was a builder in bad faith, since the respondents likewise acted in bad faith, the rights of the parties shall be determined in accordance with Article 448 of the New Civil Code, and they shall be considered as both being in good faith. The petitioner, however, posits that any award in its favor as builder in good faith would be premature because its complaint was dismissed by the court a quo, and its consequent failure to present evidence to prove the improvements it had made on the property and the value thereof.The Court, in ruling against NHA in G.R. No. 143230, did not contrive the facts of the case but cited exhaustively from the records, belying the NHA’s assertion that the facts have no basis at all. This Court likewise pointed out in G.R. No. 143230 that the trial court’s findings that it cited were affirmed by the Court of Appeals and the Supreme Court in another case, that is, in G.R. No. 107582.
The petitioner’s arguments do not persuade. In light of our foregoing disquisitions, it is evident that the petitioner acted in gross bad faith when it took possession of the property in 1976, introduced improvements thereon and disposed of said property despite knowledge that the ownership thereof pertained to the respondents.
In determining whether a builder acted in good faith, the rule stated in Article 526 of the New Civil Code shall apply.
ART. 526. He is deemed a possessor in good faith who is not aware that there exists in his title or mode of acquisition any flaw which invalidates it.
He is deemed a possessor in bad faith who possesses in any case contrary to the foregoing.
In this case, no less than the trial court in Civil Case No. C-169 declared that the petitioner not only acted in bad faith, but also violated the Constitution:And the Court cannot disregard the fact that despite persistent urging by the defendants for a negotiated settlement of the properties taken by plaintiff before the present action was filed, plaintiff failed to give even the remaining UNAWARDED lots for the benefit of herein defendants who are still the registered owners. Instead, plaintiff opted to expropriate them after having taken possession of said properties for almost fourteen (14) years.But the reprehensible and scary manner of the taking of defendants’ property in 1976, which, in a manner of speaking, was seizure by the barrel of the gun, is more aptly described by the defendants in the following scenario of 1976, to wit:
The callous disregard of the Rules and the Constitutional mandate that private property shall not be taken without just compensation and unless it is for public use, is UNSURPRISING, considering the catenna (sic) of repressive acts and wanton assaults committed by the Marcos Regime against human rights and the Constitutional rights of the people which have become a legendary part of history and mankind.
True it is, that the plaintiff may have a laudable purpose in the expropriation of the land in question, as set forth in the plaintiff’s cause of action that – “The parcel of land as described in the paragraph immediately preceding, together with the adjoining areas encompassed within plaintiff’s Dagat-Dagatan Development Project, are designed to be developed pursuant to the Zonal Improvement Program (ZIP) of the Government, as a site and services project, a vital component of the Urban III loan package of the International Bank for Rehabilitation and Development (World Bank), which is envisioned to provide affordable solution to the urban problems of shelter, environmental sanitation and poverty and to absorb and ease the impact of immigration from rural areas to over-crowded population centers of Metro Manila and resident middle income families who do not have homelots of their own with the Metro Manila area. x x x.”1.01. Sometime in the mid-seventies, a truckload of fully-armed military personnel entered the Baello property in Caloocan City [then covered by OCT No. (804) 55839] (sic) and, at gunpoint, forcibly ejected the family’s caretaker. The soldiers, thereafter, demolished a two-storey residence and destroyed all fishpond improvements found inside the property.Evidently, plaintiff’s seizure of defendants’ property is an audacious infringement of their rights to DUE PROCESS.
1.02. From this period up till the end of the Marcos misrule, no decree, no court order, no ordinance was shown or made known to the defendants to justify the invasion, assault, and occupation of their property. Worse, defendants were not even granted the courtesy of a letter or memorandum that would explain the government’s intention on the subject property.
1.03. The military’s action, coming as it does at the height of martial law, elicited the expected response from the defendants. Prudence dictated silence. From government news reports, defendants gathered that their land was seized to complement the erstwhile First Lady’s Dagat-Dagatan project. Being a pet program of the dictator’s wife, defendants realized that a legal battle was both dangerous and pointless.
1.04. Defendants’ property thus came under the control and possession of the plaintiff. The NHA went on to award portions of the subject property to dubious beneficiaries who quickly fenced their designated lots and/or erected permanent structures therein. During all this time, no formal communication from the NHA was received by the defendants. The plaintiff acted as if the registered owners or their heirs did not exist at all.
1.05. The celebrated departure of the conjugal dictators in February 1986 kindled hopes that justice may at least come to the Baellos. Verbal inquiries were made on how just compensation can be obtained from the NHA considering its confiscation of the subject property. The representations proved fruitless.
The immediate taking of possession, control and disposition of property without due notice and hearing is violative of due process (Sumulong vs. Guerrero, 154 SCRA 461).
On the matter of issuance of writ of possession, the ruling in the Ignacio case as reiterated in Sumulong vs. Guerrero states:“[I]t is imperative that before a writ of possession is issued by the Court in expropriation proceedings, the following requisites must be met: (1) There must be a Complaint for expropriation sufficient in form and in substance; (2) A provisional determination of just compensation for the properties sought to be expropriated must be made by the trial court on the basis of judicial (not legislative or executive) discretion; and (3) The deposit requirement under Section 2, Rule 67 must be complied with.”Here, it is even pointless to take up the matter of said requisites for the issuance of writ of possession considering that, as stated, NO complaint was ever filed in Court AT THE TIME of the seizure of defendants’ properties.
Recapitulating – that the plaintiff’s unlawful taking of defendants’ properties is irretrievably characterized by BAD FAITH, patent ARBITRARINESS and grave abuse of discretion, is non-arguable.
The aforequoted findings of the trial court were affirmed by the Court of Appeals and by this Court in G.R. No. 107582.14cralaw virtualaw library
Art. 449. He who builds, plants or sows in bad faith on the land of another, loses what is built, planted or sown without right of indemnity.Thus, under Article 449 of the Civil Code, the NHA is not entitled to be reimbursed of the expenses incurred in the development of respondents’ property.
1 Under Rule 45 of the 1997 Rules of Civil Procedure.
2Rollo, pp. 32-50. Penned by Associate Justice Socorro B. Inting with Associate Justices Fernanda Lampas Peralta and Mariflor Punzalan Castillo, concurring.
3 Id. at 51-52.
4 Erroneously referred to as Francisco in the body of the Court of Appeals’ decision.
5National Housing Authority v. Baello, 480 Phil. 502 (2004).
6 Spouses Nestor and Evangeline Ponce and several John and Jane Does. The case against the spouses Ponce was subsequently dismissed (Rollo, p. 55).
7 Id. at 57.
8 Id. at 54-64. Penned by Presiding Judge Eleanor R. Kwong.nadcralawlibrary
9 Id. at 64.redcralaw
10 Id. at 49.
11Ley Construction & Development Corporation v. Philippine Commercial & International Bank, G.R. No. 160841, 23 June 2010, 621 SCRA 526, 534-535. Citations omitted.
12 Id. at 535-536.
13Spouses Rasdas v. Estenor, 513, 676, Phil. 664 (2005).
14National Housing Authority v. Baello, supra note 5, at 530-533.
15 Id. at 520.