Dela Cruz vs. Court of Appeals

An ejectment suit based on possession by tolerance is a species of unlawful detainer, and the one-year prescriptive period to file the action is counted from the date of the last demand to vacate, not from the date of the initial entry or the first demand.

The Reyes family owned a lot at 1332 Lacson Street, Sampaloc, Manila, leased to petitioner Lourdes Dela Cruz for over 40 years. In 1989, a fire destroyed the premises. Dela Cruz rebuilt her house and remained on the lot despite verbal demands from the Reyeses to vacate. A written demand was served on February 21, 1994, but the Reyeses never filed an ejectment suit. On November 26, 1996, the Reyeses sold the lot to respondent Melba Tan Te, who, after unsuccessful barangay conciliation and a final written demand on January 14, 1997, filed an ejectment complaint on September 8, 1997.

• Prior Lease: The Reyes family owned a lot at 1332 Lacson Street, Sampaloc, Manila. Petitioner Lourdes Dela Cruz leased a portion of the lot for over 40 years, paying rent regularly.
• Fire and Rebuilding: In 1989, a fire destroyed the dwellings on the lot. Petitioner returned and rebuilt her house without the owners' consent. The Reyeses made verbal demands to vacate, which petitioner ignored.
• Demand to Vacate: On February 21, 1994, a written demand to vacate was served on petitioner, but she refused to leave. The Reyeses did not initiate any court proceedings.
• Sale to Respondent: On November 26, 1996, the Reyeses sold the lot to respondent Melba Tan Te for residential purposes via a Deed of Absolute Sale. Petitioner continued to occupy the lot.
• Final Demand and Conciliation: On January 14, 1997, respondent sent a written demand to relinquish the premises. Petitioner ignored it. Barangay conciliation failed after respondent rejected petitioner's counter-offer of PhP 500,000.00 for her house. A certificate to file action was issued.
• Filing of Ejectment: On September 8, 1997, respondent filed an ejectment complaint before the Manila MeTC.

• Jurisdiction: Petitioner argued that the MeTC lacked jurisdiction because more than one year had elapsed from the alleged forcible entry—reckoned from the February 21, 1994 demand—transforming the action into an accion publiciana under the RTC's jurisdiction.
• Protection under Rental Control Laws: Petitioner maintained that as a rent-paying tenant for decades, she was protected by P.D. No. 20 and subsequent rental control laws against dispossession.
• Encumbrance and Right of First Refusal: Petitioner argued that her lease constituted a legal encumbrance binding on the successor-in-interest, and she possessed a right of first refusal under P.D. No. 1571.
• Expropriation: Petitioner claimed the lot was subject of a pending expropriation proceeding under Manila City Ordinance No. 7951.

• Prior Possession and Deprivation: Respondent averred that the previous owners were in possession and control of the lot, and petitioner deprived them of possession by entering surreptitiously and by stealth.
• Unlawful Withholding: Respondent argued that petitioner unlawfully withheld possession of the property after the sale and despite several written demands to vacate, the last being on January 14, 1997.
• Jurisdiction: Implicitly, respondent contended that the MeTC had jurisdiction over the unlawful detainer suit filed within one year from the last demand.

• Jurisdiction: Whether the MeTC or the RTC has jurisdiction over the ejectment complaint.
• Right to Possess: Whether respondent is entitled to the ejectment of petitioner from the premises.
• Expropriation: Whether the intended expropriation of the lot by the Manila City Government affects the resolution of the petition.

• Jurisdiction: The MeTC has jurisdiction. The action is one for unlawful detainer based on possession by tolerance, not forcible entry. Although the complaint's allegations were ambiguous, the rule that jurisdiction is determined solely by the complaint was relaxed, considering the judicial admission of tenancy in the answer, the nine-year pendency of the case, and the need for substantial justice. The one-year prescriptive period for unlawful detainer is reckoned from the date of the last demand (January 14, 1997), not the first demand (February 21, 1994). The action filed on September 8, 1997 was well within the one-year period.
• Right to Possess: Respondent is entitled to physical possession. Petitioner's possession, initially legal under the lease, became unlawful after the fire terminated the lease and the owners demanded she vacate. Her continued stay was merely by the tolerance of the owners and, subsequently, the respondent, carrying an implied promise to vacate upon demand.
• Expropriation: The intended expropriation does not affect the resolution. The issue was raised for the first time before the Supreme Court and is thus proscribed. Moreover, the ordinance merely authorized the Mayor to locate funds, indicating the expropriation might not even be implemented.

• Possession by Tolerance — A person who occupies the land of another at the latter's tolerance or permission, without any contract between them, is bound by an implied promise to vacate upon demand. Failing to do so, a summary action for ejectment (unlawful detainer) is the proper remedy. The unlawful withholding of possession is counted from the date of the demand to vacate, and the one-year prescriptive period to file the action is reckoned from that date.
• Determination of Jurisdiction Based on Pleadings — The nature of an action and the court's jurisdiction are generally determined by the allegations in the complaint. However, exceptions exist: (1) when the defense of lack of jurisdiction is raised in the answer and the admission therein (e.g., tenancy) is material to determining jurisdiction; (2) when dismissing the complaint would severely hamper the effective dispensation of justice after a long period of litigation; and (3) when liberal construction of the rules is warranted to promote just, speedy, and inexpensive disposition of the action.

• "A person who occupies the land of another at the latter’s tolerance or permission, without any contract between them, is necessarily bound by an implied promise that he will vacate upon demand, failing which a summary action for ejectment is the proper remedy against them. The status of the defendant is analogous to that of a lessee or tenant whose term of lease has expired but whose occupancy continued by tolerance of the owner. In such a case, the unlawful deprivation or withholding of possession is to be counted from the date of the demand to vacate."
• "Let it be emphasized that the rules of procedure should be viewed as mere tools designed to facilitate the attainment of justice. Their strict and rigid application, which would result in technicalities that tend to frustrate rather than promote substantial justice, must always be eschewed."

• Ignacio v. CFI of Bulcan, G.R. No. L-27897-98 — Followed. Cited as an exception to the rule that jurisdiction is determined solely by the complaint; where tenancy is averred by way of defense and proved to be the real issue, the case should be dismissed for lack of jurisdiction (in that case, for the Court of Agrarian Relations). Applied here to justify considering the answer's admission of tenancy to determine the real nature of the action.
• Calubayan v. Pascual, G.R. No. L-22645 — Followed. Cited as the leading case elucidating the concept of possession by tolerance in unlawful detainer actions.
• Barnes v. Padilla, G.R. No. 160753 — Followed. Cited to support the Court's power to relax or suspend the application of procedural rules to promote substantial justice.

• Section 33, Batas Pambansa Blg. 129 — Confered exclusive original jurisdiction over cases of forcible entry and unlawful detainer to first-level courts (MeTC, MTC, MCTC). Applied to establish the MeTC's jurisdiction over the unlawful detainer suit.
• Section 19, Batas Pambansa Blg. 129 — Confered exclusive original jurisdiction to RTC over civil actions involving title to or possession of real property (accion publiciana, accion reivindicatoria), except ejectment cases. Referenced to contrast RTC jurisdiction with MeTC jurisdiction.
• Section 1, Rule 70, 1997 Rules of Civil Procedure — Defines forcible entry and unlawful detainer. Applied to distinguish the requisites of forcible entry from unlawful detainer.
• Section 6, Rule 1, Rules of Court — Mandates liberal construction of the Rules to promote just, speedy, and inexpensive disposition of every action. Applied to justify relaxing the rule on determining jurisdiction solely from the complaint.

Quisumbing, Carpio, Carpio Morales, and Tinga.