Elane vs. Court of Appeals

In a forcible entry case, the decisive issue is priority of physical possession, not who has the legal right to possess; the prior possessor's material possession must be protected until a competent court in an appropriate case determines which of the contending parties has the better right of possession.

Private respondent Inocencio V. Chua and petitioner Gabriel Elane both claimed the same parcel of public land in Sitio Upper Kalaklan, Olongapo, designated as Block V, LC Project No. 14, Olongapo City, BF Map LC 2427. The lot was public forest land administered by the Bureau of Forestry through permits to occupy; once an area was declared alienable and disposable, it was released to the Bureau of Lands, where an occupant could file a miscellaneous sales application to purchase it.

On August 16, 1961, Ordinary Residence Permit No. 1675 was issued by the Bureau of Forestry authorizing private respondent Inocencio V. Chua to occupy four hectares of public forest land situated in Sitio Upper Kalaklan, Olongapo, Zambales, on which he constructed a warehouse and a gasoline station pursuant to permits issued to him by the said bureau. On February 10, 1970, these improvements were declared for purposes of taxation in his name and the taxes due thereon were paid. The residence permit, which was renewable every year, was not renewed after June 30, 1969 because it was stopped by then Vice-President Fernando Lopez, although Chua continued to pay rental fees for the land until 1973.

Upon application by Chua, the lot was declared alienable and disposable public land and released by the Bureau of Forest Development to the Bureau of Lands in March 1973. On January 19, 1977, the parcel of land in question, designated as Block V, LC Project No. 14, Olongapo City, BF Map LC 2427, containing an area of 42,086 square meters, having been declared alienable and disposable, Chua filed an application with the Bureau of Lands to purchase it under Miscellaneous Sales Application No. (111-4) 9019.

In his answer, petitioner Gabriel Elane claimed that he was granted a permit by the Bureau of Forest Development over a parcel of land located at Upper Kalaklan, with an area of 360 square meters, more or less, designated as Block V, LC Project No. 14, Olongapo City, BF Map LC 2427, as allegedly evidenced by a certification from the said bureau dated April 10, 1979. He asserted that he had been in possession and occupation of that parcel continuously and uninterruptedly since 1970, having originally erected a hut thereon which was later replaced by a bungalow, and that the land had been declared for taxation in his name and the real property taxes thereon paid by him for the years 1970 to 1979.

On February 15, 1980, while visiting the property, Chua discovered that Elane was constructing a semi-concrete building on a portion thereof, without his knowledge and consent. The order made by Chua upon Elane to desist therefrom was ignored by the latter. When his demand letter of March 1, 1980 to stop said construction was refused, Chua filed an action for forcible entry on March 6, 1980.

The CA found Elane's claim of possession since 1970 to be an inaccuracy. The certification he relied upon was not actually introduced in evidence and, in any event, did not attest to the issuance of any permit to occupy the parcel of land in his favor but merely certified that the parcel was found to be alienable and disposable land. The building and sanitary/plumbing permits he cited bore no date of actual issuance and were accomplished by an applicant whose residence certificate appears to have been issued only on January 5, 1979. The survey of the parcel was prepared for Elane only on February 25, 1979, his miscellaneous sales application was filed with the Bureau of Lands only on March 26, 1979, the lot and residential building were declared for taxation only on October 18, 1979 and April 1, 1981, and the realty taxes for 1970-73, 1974-78 and 1979 were paid only on April 14, 1980, May 8, 1981 and March 16, 1982. On these facts the CA held that Elane's possession could not be retroacted to 1970 and that Chua had priority of possession, Elane's entry into the subject lot being reckonable only as of 1979.

• Finality of the RTC Decision: Petitioner argued that a copy of the RTC decision was sent by registered mail to the counsel of private respondent at his given address, that the envelope was returned to the court when counsel failed to claim it after a second notice was made on July 10, 1985, and that under Section 3, Rule 13 of the Rules of Court the decision became final on July 15, 1985 since private respondent filed neither a motion for reconsideration nor a notice of appeal.
• Priority of Possession: Petitioner argued that the CA gravely erred in resolving the case on the basis of priority of physical possession instead of the issue as to who is the legal possessor of the lot subject of the litigation.
• Expiration of the Permit: Petitioner argued that the expiration of private respondent's permit in 1969 and its non-renewal deprived the latter of his possessory right over the land and the corresponding right to eject petitioner, and that possession reverted to the Bureau of Lands, thereby vesting in that entity the sole right to institute a forcible entry case over the land.

• Finality of Judgment: Whether the CA gravely abused its discretion in giving due course to the petition for review notwithstanding that the decision sought to be reviewed had already become final and executory.
• Priority of Possession: Whether the CA gravely erred in resolving the ejectment case on the basis of priority of physical possession instead of determining who is the legal possessor of the lot.

• Finality of Judgment: No. Petitioner failed to prove that the first notice of the registered letter was sent and delivered to the addressee, so the presumption of completeness of service did not arise; the issue was also raised for the first time on appeal and is barred by estoppel by laches.
• Priority of Possession: No. In forcible entry, the decisive issue is priority of physical possession, not the legal right to possess; private respondent's prior continuous possession since 1961 entitled him to protection, and his complaint was filed within one year from demand.

• Finality of Judgment: Under Section 5, Rule 13 of the Rules of Court, a party who relies upon constructive service must prove that the first notice of the registered letter was sent and delivered to the addressee, as the presumption that official duty has been regularly performed does not apply to such a situation, per Barrameda vs. Castillo. Elane's assertions that the RTC decision was mailed to Chua's counsel, that the envelope was returned after a second notice on July 10, 1985, and that the decision became final on July 15, 1985 were unsubstantiated; in the absence of such proof in the record, the disputable presumption of completeness of service did not arise. Apart from this failure of proof, the records did not show that the issue was raised or proved in the CA when the petition for review was filed and pending there. Estoppel by laches, which is in the interest of a sound administration of the laws, bars the objection from being raised for the first time and at this late stage, as held in Tijam vs. Sibonghanoy, Crisostomo vs. Court of Appeals, and Libudan vs. Gil.

• Priority of Possession: The CA found that Chua was granted a residence permit over the 42,086-square-meter lot on August 16, 1961 and a permit to construct a warehouse and gasoline station thereon on October 1, 1963; that although the residence permit was not renewed after June 30, 1969, Chua continued to pay rental fees until 1973; that the lot was declared alienable and disposable and released to the Bureau of Lands in March 1973; that Chua filed his Miscellaneous Sales Application on January 19, 1977; and that he declared the warehouse and gasoline station for taxation and paid taxes in 1970 and 1971. Against this, Elane's claim of possession since 1970 rested on a certification that merely stated the land was alienable and disposable, not on any permit to occupy, and on undated building and sanitary/plumbing permits accomplished by an applicant whose residence certificate was issued only on January 5, 1979; his survey was prepared only on February 25, 1979, his sales application was filed on March 26, 1979, his tax declarations were made on October 18, 1979 and April 1, 1981, and his taxes were paid only in 1980, 1981 and 1982. His possession could not, therefore, be retroacted to 1970, and his entry into the subject lot could be reckoned only as of 1979. Chua, having been in prior continuous possession since August 16, 1961, was preferentially entitled to occupy the land under Article 538 of the Civil Code, which provides that possession as a fact cannot be recognized at the same time in two different personalities except in the case of co-possession, and that should a question arise regarding the fact of possession, the present possessor shall be preferred, or if there are two possessors, the one longer in possession. His material possession had to be protected in the ejectment case until a competent court in an appropriate case determined which of the contending parties had the better right of possession. It was of no moment that Chua's right to occupy the land by reason of the permit issued to him by the Bureau of Forestry had already expired, because it is not whether he had a legal right to possess it that was in issue but whether he was in actual physical possession of it, which is decisive in forcible entry, as held in Mediran vs. Villanueva. On prescription, Elane's intrusion was effected through stealth; where forcible entry is made clandestinely, the one-year prescriptive period is counted from the time the dispossessed party demanded that the deforciant desist from such dispossession when the former learned thereof, as held in Vda. de Prieto vs. Reyes and City of Manila vs. Garcia. Chua's discovery and prohibition took place on February 15, 1980, reiterated in his demand letter of March 1, 1980, both to no avail, so the one-year period had not expired when he filed the ejectment suit on March 6, 1980.

• Priority of Possession in Forcible Entry — In an ejectment case, the decisive issue is priority of physical possession, not who has the legal right to possess. The prior possessor's material possession must be protected until a competent court in an appropriate case determines which of the contending parties has the better right of possession. The SC applied this to protect Chua, who had been in actual and continuous possession since August 16, 1961, even though his residence permit had expired in 1969.
• Clandestine Forcible Entry and the One-Year Period — Where the entry is effected through stealth, the one-year prescriptive period for forcible entry is counted from the time the dispossessed party demanded that the deforciant desist, upon learning of the dispossession. The SC applied this because Chua discovered Elane's construction on February 15, 1980, reiterated his demand on March 1, 1980, and filed the complaint on March 6, 1980, well within one year.
• Constructive Service of Judgment — A party relying on constructive service under Section 5, Rule 13 of the Rules of Court must prove that the first notice of the registered letter was sent and delivered to the addressee; the presumption that official duty has been regularly performed does not apply. The SC applied this to reject Elane's claim that the RTC decision had become final.
• Estoppel by Laches — An issue not raised in the lower court cannot be raised for the first time on appeal; estoppel by laches bars it in the interest of sound administration of the laws. The SC applied this to bar Elane's finality argument, which was not raised in the CA.
• Article 538, Civil Code — Preference Among Possessors — Possession as a fact cannot be recognized at the same time in two different personalities except in the case of co-possession; should a question arise regarding the fact of possession, the present possessor shall be preferred; if there are two possessors, the one longer in possession. The SC applied this to prefer Chua, who had been in prior continuous possession since 1961.

• "it is of no moment that petitioner's right to occupy said parcel of land by reason of the permit issued to him by the Bureau of Forestry has already expired. For, it is not whether he has a legal right to possess it that is in issue; it is whether he is in actual physical possession of it that is decisive in the instant case for forcible entry." — The CA's formulation, quoted with approval, stating the decisive issue in forcible entry and explaining why the expiration of the permit did not defeat the ejectment suit.
• "Since the decisive issue is priority of possession and private respondent had been in actual and continuous possession of the land since August 16, 1961, his material possession must be protected in this ejectment case until a competent court in an appropriate case determines which of the contending parties has the better right of possession." — The SC's own statement of the rule protecting prior possession pending a determination of the better right.
• "Where forcible entry was thus made clandestinely, the one-year prescriptive period should be counted from the time private respondent demanded that the deforciant desist from such dispossession when the former learned thereof." — The rule on counting the prescriptive period in clandestine entry, which saved the March 6, 1980 complaint from being time-barred.
• "It is incumbent upon a party who relies upon constructive service under Section 5 of Rule 13 of the Rules to prove that the first notice of the registered letter was sent and delivered to the addressee, as the presumption that official duty has been regularly performed does not apply to such a situation." — The rule on constructive service, applied to reject petitioner's claim that the RTC decision had already become final.

• Barrameda vs. Castillo, 78 SCRA 4 (1977) — Controlling authority for the rule that a party relying on constructive service must prove the first notice of the registered letter was sent and delivered.
• Tijam vs. Sibonghanoy, 23 SCRA 29 (1968) — Cited for estoppel by laches barring objections raised for the first time at a late stage.
• Crisostomo vs. Court of Appeals, 32 SCRA 54 (1970) — Cited for the same rule on estoppel by laches.
• Libudan vs. Gil, 45 SCRA 17 (1972) — Cited for the same rule on estoppel by laches.
• Mediran vs. Villanueva, 37 Phil. 752 (1918) — Cited for the rule that the decisive issue in forcible entry is actual physical possession, not legal right to possess.
• Vda. de Prieto vs. Reyes, 14 SCRA 430 (1965) — Cited for counting the one-year prescriptive period from demand in clandestine forcible entry.
• City of Manila vs. Garcia, 19 SCRA 413 (1967) — Cited for the same rule on the prescriptive period in clandestine entry.

• Section 5, Rule 13, Rules of Court — Constructive service of judgment by registered mail; applied to hold that petitioner failed to prove the first notice was sent and delivered, so the presumption of completeness of service did not arise.
• Section 3, Rule 13, Rules of Court — Invoked by petitioner for the rule that a decision becomes final upon expiration of the reglementary period; the SC found the premise of valid service unproven.
• Article 538, Civil Code — Preference among possessors; applied to prefer private respondent as the one longer in possession of the disputed lot.