Spouses Abad v. Fil-Homes Realty and Development Corp., G.R. No. 189239, November 24, 2010

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Summary: Fil-Homes Realty and Magdiwang Realty co-owned two lots situated in Sucat, Parañaque City. The 2 Corporations filed a complaint for unlawful detainer against the Petitioners.

Their allegation: Petitioners, through tolerance, had occupied the subject lots since 1980 but ignored their repeated demands to vacate them.

During the pendency of the case, the City of Parañaque filed expropriation proceedings covering the lots before the RTC Parañaque with the intention of establishing a socialized housing project therein for distribution to the occupants including Petitioners. A writ of possession was consequently issued and a Certificate of Turn-over given to the City.

MeTC ruled in favor of the Corporations, and ordered Petitioners Sps. Abad et. al to VACATE and SURRENDER possession of the premises to the Corporations.

On appeal, the RTC reversed the MeTC decision and dismissed Corparations' complaint.

Ratio: the issuance of a writ of possession in favor of the City bars the continuation of the unlawful detainer proceedings, and since the judgment had already been rendered in the expropriation proceedings which effectively turned over the lots to the City, the MeTC has no jurisdiction to disregard the final judgment and writ of possession due to non-payment of just compensation.

The Corporations then filed a petition for review.

CA reinstated the MeTC Decision with a modification – deleted atty's fees

- Peitioners did not present evidence to rebut Corporations' allegation of possession by tolerance.  Petitioner likewise admitted that they commenced occupation of the property without the permission of the previous owner ─ Pilipinas Dev't Corp ─ as indicium of tolerance by Corps' predecessor-in-interest.

- respecting the issuance of a writ of possession in the expropriation proceedings, the SC in Republic v. Gingoyon held that the issuance does not signify the completion of the expropriation proceedings.

 Peitioners' MR was denied. Hence, the present petition for review.

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Peitioners' Position:

- Since the lots are the subject of expropriation proceedings, the Corps can no longer assert a better right of possession;

- the City Ordinance authorizing the initiation of expropriation proceedings designated them as beneficiaries of the lots, hence, they are entitled to continue staying there.

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SC affirmed the CA decision.

(1) S1 of Commonwealth Act No. 538 states:

Section 1. When the Government seeks to acquire, through purchase or expropriation proceedings, lands belonging to any estate or chaplaincy (cappellania), any action for ejectment against the tenants occupying said lands shall be automatically suspended, for such time as may be required by the expropriation proceedings or the necessary negotiations for the purchase of the lands, in which latter case, the period of suspension shall not exceed one year.

To avail himself of the benefits of the suspension, the tenants shall pay to the landowner the current rents as they become due or deposit the same with the court where the action for ejectment has been instituted.

Peitioners did not comply with any of the acts mentioned in the law to avail of the benefits of the suspension.

(2) The mere issuance of a writ of possession in the expropriation proceedings did not transfer ownership of the lots in favor of the City. Such issuance was only the first stage in expropriation.* There is even no evidence that judicial deposit had been made in favor of the Corps prior to the City's possession of the lots, contrary to S19 of the LGC.

(3) Respecting Petitioners' claim that they have been named beneficiaries of the lots, the city ordinance authorizing the initiation of expropriation proceedings does not state so. Petitioners cannot thus claim any right over the lots on the basis of the ordinance.

Note: Expropriation of lands consists of two stages: The first is concerned with the determination of the authority of the plaintiff to exercise the power of eminent domain and the propriety of its exercise in the context of the facts involved in the suit. The second phase of the eminent domain action is concerned with the determination by the court of "the just compensation for the property sought to be taken."

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Ponente: CARPIO MORALES, J.

A petition for review

Facts:

Fil-Homes Realty and Development Corporation and Magdiwang Realty Corporation, co-owners of two lots situated in Sucat, Paraaque City, filed a complaint for unlawful detainer against the Peitioners before the Parañaque MeTC.

Their allegations: Petitioners, through tolerance, had occupied the subject lots since 1980 but ignored their repeated demands to vacate them.

Peitioners filed their Answers, stating that:

-  there is no possession by tolerance for they have been in adverse, continuous and uninterrupted possession of the lots for more than 30 years;

- Rs predecessor-in-interest, Pilipinas Development Corporation, had no title to the lots.

- In any event, the question of ownership must first be settled before the issue of possession may be resolved.

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During the pendency of the case, the City of Parañaque filed expropriation proceedings covering the lots before the RTC Parañaque with the intention of establishing a socialized housing project therein for distribution to the occupants including Ps. A writ of possession was consequently issued and a Certificate of Turn-over given to the City.

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MeTC ruled in favor of the Corporations, and ordered Petitioners Sps Abad et. als. to VACATE and SURRENDER possession of the premises known as Purok I Silverio Compound to the Corps and to PAY them:

1.      P20k a month until the Ps shall have finally vacated the premises;

2.      P20k as and for attorneys fees + costs of suit.

Ratio:

- no payment had been made to the Corps for the lots, they still, thus, maintain ownership thereon.

- Peitioners cannot claim a better right by virtue of the issuance of a Writ of Possession for the project beneficiaries have yet to be named.

On appeal, the RTC reversed the MeTC decision and dismissed Corps' complaint.

Ratio:

- MeTC is wrong. It is not the allegations of the Complaint that finally determine whether a case is unlawful detainer, rather it is the evidence in the case. Unlawful detainer requires the significant element of tolerance. Tolerance of the occupation of the property must be present right from the start of the Ps' possession. The phrase from the start of Ps' possession is significant. When there is no tolerance right from the start of the possession sought to be recovered, the case of unlawful detainer will not prosper.

 - the issuance of a writ of possession in favor of the City bars the continuation of the unlawful detainer proceedings, and since the judgment had already been rendered in the expropriation proceedings which effectively turned over the lots to the City, the MeTC has no jurisdiction to disregard the final judgment and writ of possession due to non-payment of just compensation.

Corporations then filed a petition for review.

CA reinstated the MeTC Decision with a modification – deleted atty's fees

- Petitioners did not present evidence to rebut Corps' allegation of possession by tolerance; Ps' likewise admitted that they commenced occupation of the property without the permission of the previous owner ─ Pilipinas Development Corporation ─ as indicium of tolerance by Corps' predecessor-in-interest.

- Where the defendants entry upon the land was with plaintiff's tolerance from the date and fact of entry, unlawful detainer proceedings may be instituted within one year from the demand on him to vacate upon demand.

- respecting the issuance of a writ of possession in the expropriation proceedings, the SC in Republic v. Gingoyon held that the issuance does not signify the completion of the expropriation proceedings.

Peitioners' MR was denied. Hence the present petition for review.

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Petitioners' Position:

- Since the lots are the subject of expropriation proceedings, the Corps can no longer assert a better right of possession;

- the City Ordinance authorizing the initiation of expropriation proceedings designated them as beneficiaries of the lots, hence, they are entitled to continue staying there.

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WON the Peitioners has a better right of possession of the said lots than the Corporations

Held: No

(1) As a general rule, ejectment proceedings, due to its summary nature, are not suspended or their resolution held in abeyance despite the pendency of a civil action regarding ownership.

Section 1 of Commonwealth Act No. 538 enlightens, however:

Section 1. When the Government seeks to acquire, through purchase or expropriation proceedings, lands belonging to any estate or chaplaincy (cappellania), any action for ejectment against the tenants occupying said lands shall be automatically suspended, for such time as may be required by the expropriation proceedings or the necessary negotiations for the purchase of the lands, in which latter case, the period of suspension shall not exceed one year.

To avail himself of the benefits of the suspension, the tenants shall pay to the landowner the current rents as they become due or deposit the same with the court where the action for ejectment has been instituted.

Peitioners did not comply with any of the acts mentioned in the law to avail of the benefits of the suspension.

(2) In re: Peitioners' position. It does not lie.

The exercise of expropriation by a local government unit is covered by S19 of the LGC:

SEC. 19. Eminent Domain. A local government unit may, through its chief executive and acting pursuant to an ordinance, exercise the power of eminent domain for public use, or purpose, or welfare for the benefit of the poor and the landless, upon payment of just compensation, pursuant to the provisions of the Constitution and pertinent laws: Provided, however, That the power of eminent domain may not be exercised unless a valid and definite offer has been previously made to the owner, and such offer was not accepted: Provided, further, That the local government unit may immediately take possession of the property upon the filing of the expropriation proceedings and upon making a deposit with the proper court of at least fifteen percent (15%) of the fair market value of the property based on the current tax declaration of the property to be expropriated: Provided, finally, That the amount to be paid for the expropriated property shall be determined by the proper court, based on the fair market value of the property.

Lintag v. National Power Corporation clearly outlines the stages of expropriation, viz:

Expropriation of lands consists of two stages:

The first is concerned with the determination of the authority of the plaintiff to exercise the power of eminent domain and the propriety of its exercise in the context of the facts involved in the suit. It ends with an order, if not of dismissal of the action, "of condemnation declaring that the plaintiff has a lawful right to take the property sought to be condemned, for the public use or purpose described in the complaint, upon the payment of just compensation to be determined as of the date of the filing of the complaint x x x.

The second phase of the eminent domain action is concerned with the determination by the court of "the just compensation for the property sought to be taken." This is done by the court with the assistance of not more than three (3) commissioners x x x .

It is only upon the completion of these two stages that expropriation is said to have been completed. The process is not complete until payment of just compensation. Accordingly, the issuance of the writ of possession in this case does not write finis to the expropriation proceedings. To effectuate the transfer of ownership, it is necessary for the NPC to pay the property owners the final just compensation.

In the present case, the mere issuance of a writ of possession in the expropriation proceedings did not transfer ownership of the lots in favor of the City. Such issuance was only the first stage in expropriation. There is even no evidence that judicial deposit had been made in favor of the Corps prior to the City's possession of the lots, contrary to Section 19 of the LGC.

Respecting Ps' claim that they have been named beneficiaries of the lots, the city ordinance authorizing the initiation of expropriation proceedings does not state so. Ps cannot thus claim any right over the lots on the basis of the ordinance.

Even if the lots are eventually transferred to the City, it is non sequitur for Ps to claim that they are automatically entitled to be beneficiaries thereof. For certain requirements must be met and complied with before they can be considered to be beneficiaries.

WHEREFORE, the petition for review is DENIED.

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