Catedrilla vs. Lauron

A co-owner may bring an ejectment suit without joining all other co-owners as co-plaintiffs because the suit is deemed instituted for the benefit of all. Additionally, the owner of a house built on the subject lot is not an indispensable party in an ejectment suit against the actual occupants, as the only issue is physical possession, and a breached compromise agreement may be regarded as rescinded under Article 2041 of the Civil Code, reviving the original demand.

Lorenza Lizada owned Lot 183 in Lambunao, Iloilo. Upon her death, the lot passed to her sole heir Jesusa Lizada Losañes, married to Hilarion Castigador. Their daughter Lilia Castigador inherited a portion, Lot No. 5, but predeceased her parents. Lilia's heirs—her husband Maximo Catedrilla and their children, including petitioner Rey Castigador Catedrilla—agreed to subdivide the property. In 1980, respondents Mario and Margie Lauron constructed a residential building on a 100-square-meter portion of Lot No. 5 with the tolerance of Lilia's heirs. Demands to vacate were made, but respondents refused.

• Ownership and Tolerated Occupation: Lot 183 was originally owned by Lorenza Lizada. Upon her death, it passed to her daughter Jesusa, then to Jesusa's daughter Lilia Castigador. Lilia died in 1976, and her heirs—including her husband Maximo and their children, one of whom is petitioner Rey Catedrilla—agreed to subdivide the property, with Lot No. 5 allocated to them. In 1980, respondents Mario and Margie Lauron constructed a residential building on a 100-square-meter portion of Lot No. 5 with the tolerance of Lilia's heirs.
• Sale Negotiations and Amicable Settlement: Mildred Kascher, respondent Margie's sister, paid ₱10,000.00 as downpayment for the subject lot to a certain Teresito Castigador. In 1998, Maximo and respondent Margie signed an amicable settlement before the Barangay Lupon, wherein Maximo agreed to sell the lot to Mildred and her husband for ₱90,000.00, subject to Maximo preparing the necessary documents. Maximo failed to prepare the documents. Subsequently, Liah Catedrilla, one of petitioner's co-heirs, wrote a letter to respondents stating that respondents had changed the purchase price from the agreed amount. Respondents failed to comply with the settlement terms or address the price discrepancy.
• The Ejectment Suit: After respondents ignored demands to vacate, petitioner filed a complaint for unlawful detainer in 2003. Respondents claimed that Mildred, not they, owned the house on the lot, and that the amicable settlement barred the suit.

• Validity of the Trial Court's Decision: Petitioner argued that the Court of Appeals erred in declaring the trial court's decision a nullity based on the non-joinder of his co-heirs as co-plaintiffs.
• Indispensable Party Status of Mildred: Petitioner maintained that Mildred Kascher was not an indispensable party, as the ejectment suit was directed against the actual occupants (respondents) and involved only the issue of physical possession.

• Joinder of Indispensable Parties: Respondents argued that the other co-heirs should have been impleaded as co-plaintiffs, as their presence was indispensable for the court to validly render judgment.
• Ownership of the House: Respondents countered that Mildred Kascher was the real owner of the residential building on the subject lot, making her an indispensable party to the suit.
• Bar by Prior Judgment: Respondents maintained that the amicable settlement executed before the Barangay Lupon had the force and effect of a final judgment, thus barring the instant ejectment suit.

• Joinder of Co-owners: Whether a co-owner may file an ejectment suit without impleading the other co-owners as co-plaintiffs.
• Indispensable Party: Whether the alleged owner of the house built on the subject lot is an indispensable party in an ejectment suit against the actual occupants.
• Effect of Compromise Agreement: Whether the amicable settlement bars the filing of the ejectment suit.

• Joinder of Co-owners: A co-owner may bring an ejectment suit without joining all other co-owners as co-plaintiffs. Pursuant to Article 487 of the Civil Code, the suit is deemed instituted for the benefit of all co-owners, provided the plaintiff does not claim exclusive possession for himself. Because petitioner recognized the co-ownership and filed the suit for the benefit of all heirs, his solitary filing was proper.
• Indispensable Party: Mildred Kascher is not an indispensable party. In ejectment cases, the sole issue is physical or material possession, independent of claims of ownership. The real party-in-interest as defendant is the person in actual possession without any contract. Because respondents were the actual occupants by mere tolerance, they were correctly impleaded. The affidavits did not admit Mildred's ownership of the house, and the amicable settlement was signed by Margie on behalf of her parents, not by Mildred.
• Effect of Compromise Agreement: The amicable settlement did not bar the suit. While such settlements have the effect of res judicata, Article 2041 of the Civil Code provides that if one party fails to abide by the compromise, the aggrieved party may regard it as rescinded and insist upon the original demand. Respondents' non-compliance with the settlement terms constituted repudiation, rescinding the agreement and reviving petitioner's right to seek ejectment.

• Co-owner's Right to Ejectment — Under Article 487 of the Civil Code, any co-owner may bring an action for ejectment without the necessity of joining all the other co-owners as co-plaintiffs, because the suit is deemed instituted for the benefit of all. The other co-owners are not even necessary parties, as complete relief can be afforded without their participation.
• Rescission of Compromise Agreements — Under Article 2041 of the Civil Code, if one party fails or refuses to abide by a compromise, the aggrieved party may either enforce the compromise or regard it as rescinded and insist upon the original demand. The aggrieved party may bring the suit contemplated in the original demand as if there had never been a compromise agreement, without needing a prior action for rescission.

• "A co-owner may bring such an action, without the necessity of joining all the other co-owners as co-plaintiffs, because the suit is deemed to be instituted for the benefit of all. If the action is for the benefit of the plaintiff alone, such that he claims possession for himself and not for the co-ownership, the action will not prosper."
• "In exercising the second option under Art. 2041, the aggrieved party may, if he chooses, bring the suit contemplated or involved in his original demand, as if there had never been any compromise agreement, without bringing an action for rescission. This is because he may regard the compromise as already rescinded by the breach thereof of the other party."

• Wee v. De Castro, G.R. No. 176405, August 20, 2008, 562 SCRA 695 — Followed. The Court reiterated the rule that a co-owner may bring an ejectment action without joining all other co-owners because the suit is deemed instituted for the benefit of all.
• Carandang v. Heirs of De Guzman — Followed. The Court declared that a co-owner is not even a necessary party to an ejectment action, for complete relief can be afforded even in their absence, as the suit is presumed filed for the benefit of all co-owners.
• Chavez v. Court of Appeals, G.R. No. 159411, March 18, 2005, 453 SCRA 843 — Cited. Explained the nature of amicable settlements under the Revised Katarungang Pambarangay Law and their effect as res judicata under Article 2037 of the Civil Code.
• Heirs of Zari, et al. v. Santos — Followed. Clarified that Article 2041 of the Civil Code qualifies Article 2037, granting the aggrieved party the right to regard a breached compromise as rescinded and insist upon the original demand.

• Article 487, Civil Code — Provides that any one of the co-owners may bring an action in ejectment. Applied to uphold the right of petitioner to file the unlawful detainer suit alone for the benefit of all co-heirs.
• Article 2037, Civil Code — Provides that a compromise has upon the parties the effect and authority of res judicata. Applied as the general rule on amicable settlements, subject to the exception in Article 2041.
• Article 2041, Civil Code — Provides that if one party fails to abide by the compromise, the other party may either enforce it or regard it as rescinded and insist upon the original demand. Applied to rule that respondents' non-compliance rescinded the amicable settlement, reviving petitioner's right to ejectment.
• Section 1, Rule 70, Rules of Court — Governs who may institute proceedings for forcible entry and unlawful detainer. Applied to affirm that a person against whom possession is unlawfully withheld after termination of the right to hold possession may bring an action for restitution.
• Section 7, Rule 3, Rules of Court — Governs the compulsory joinder of indispensable parties. Interpreted in light of Article 487 to mean that co-owners are not indispensable parties in an ejectment suit filed by one co-owner.

Presbitero J. Velasco, Jr., Roberto A. Abad, Jose Catral Mendoza, Marvic Mario Victor F. Leonen