Laus vs. Optimum Security Services, Inc.

A writ of preliminary injunction requires a clear and uncontested existing right and prior possession, may not be used to transfer disputed possession, and will not issue when the act sought to be enjoined has become fait accompli; non-joinder of alleged indispensable parties, however, is not a ground for outright dismissal of the complaint.

Petitioners Spouses Ceferino C. Laus and Monina P. Laus and Spouses Antonio O. Koh and Elisa T. Koh assert registered ownership over eight parcels in Mabalacat, Pampanga. Respondent Optimum Security Services, Inc. is a security agency engaged through a Security Service Contract executed by Mr. Ranilo M. Arceo as attorney-in-fact of rival claimants asserting ownership derived from emancipation patent holders. TIPCO Estate Corporation was impleaded as an additional defendant alleged to have acted with the guards.

Petitioners Spouses Laus and Spouses Koh claim ownership of eight parcels of land in Mabalacat, Pampanga covered by Transfer Certificates of Title Nos. 576602-R, 578037-R, 578038-R, 578039-R, 575138-R, 575112-R, 576601-R, and 576603-R. On October 3, 2005, they sued respondent Optimum Security Services, Inc., several of its security guards including Ronnie Marivalles and Rodrigo Olivette, and TIPCO Estate Corporation, alleging that on three separate occasions in August 2005 armed guards working for respondent and TIPCO prevented them from entering the subject properties. They prayed for moral, exemplary, and liquidated damages, for a temporary restraining order and writ of preliminary injunction directing defendants to refrain from interfering with their rights as owners, and for a permanent injunction after trial.

According to respondent and Marivalles, petitioners did not own the properties and were properly denied access pursuant to a Security Service Contract. They maintained that Margarita dela Rosa, Manuel dela Pena, Michael Pineda, Fermin Dizon, William Lee, and Odon Sibug were the real owners, having bought from four original emancipation patent holders and having authorized Mr. Ranilo M. Arceo to contract respondent to secure the properties. Respondent further asserted good-faith compliance with contractual obligation, alleged forgery of the signatures on the deeds of sale source of petitioners' titles, and cited a pending petition for cancellation of petitioners' titles filed by Jose Bermudo, one of the original patent holders. In its Answer, respondent added that no wrongful act was committed and no injury was suffered, praying for dismissal and for damages and attorney's fees. TIPCO, for its part, denied preventing entry, disclaimed ownership or possession, and denied hiring the guards.

The trial court found petitioners to have sufficiently established registered ownership and consequent right to possess, found respondent's contrary ownership defense unsupported by presentation of the alleged real owners, and enjoined interference with acts of ownership. The Court of Appeals, in contrast, noted petitioners' titles were contested, petitioners had not shown prior physical possession, and rival claimants asserted possession since 1996 and 1997 with pending annulment and ownership suits, including an action by Alexander Bermudo and an action by Margarita dela Rosa over Lot 61 before the same lower court.

• Ownership and Right to Injunction: Respondent countered that petitioners are not entitled to TRO and WPI because they do not own the subject properties, the real owners being Margarita dela Rosa, Manuel dela Pena, Michael Pineda, Fermin Dizon, William Lee, and Odon Sibug who authorized Mr. Arceo to enter into the Security Service Contract with respondent.
• Good Faith and Contractual Compliance: Respondent argued that it acted in good faith in denying petitioners and their agents access as it was merely complying with a contractual obligation to secure the subject properties.
• Forged Titles and Pending Cancellation: Respondent maintained that the signatures on the Deeds of Sale source of petitioners' titles were forged and that a petition for cancellation of petitioners' titles filed by Jose Bermudo was still pending before another court.
• Absence of Injury: Respondent added in its Answer that petitioners suffered no injury as no wrongful act was committed against them, warranting dismissal for lack of merit with damages and attorney's fees to respondent.

• Preliminary Injunction: Whether the CA erred in lifting the WPI issued by the RTC where petitioners' title was disputed and prior possession was not established.
• Dismissal for Defective Parties: Whether the CA erred in dismissing the complaint on the ground that respondent was not a real party in interest and that the alleged real owners, as real parties in interest, were not joined.

• Preliminary Injunction: No error. Lifting was proper because no clear existing right and prior possession was shown, injunction may not transfer disputed possession, and the contract had lapsed rendering the writ fait accompli.
• Dismissal for Defective Parties: Yes, the dismissal was erroneous. The rival owners are not indispensable parties and, even if they were, non-joinder is not a ground for dismissal but requires an order to implead.

• Preliminary Injunction: An injunctive writ issues only upon clear showing of an actual existing right to be protected during pendency of the principal action; when right or title is doubtful or disputed, no clear legal right exists. Preliminary injunction preserves the status quo — the last actual, peaceable, and uncontested situation preceding controversy — and is not a remedy to take property from one party and deliver it to another where the right is disputed or to create new relations. Although petitioners appeared as registered owners, the complaint never alleged prior physical possession, alleging only refusal to recognize ownership and peaceful possession, while respondent alleged rival possession since 1996 and 1997 with title contests and pending annulment suits. Issuance thus transferred possession rather than preserving it, constituting grave abuse of discretion. Moreover, the Security Service Contract had expired without renewal and respondent had vacated, so the act sought to be enjoined had become fait accompli, leaving nothing to enjoin.
• Dismissal for Defective Parties: A real party in interest stands to be benefited or injured by the judgment or is entitled to its avails, while an indispensable party is one without whom no final determination can be had, as distinguished from a necessary party whose joinder merely permits complete relief. Despite its caption as damages, the pleading's allegations show an action for injunction to permanently restrain interference with access, with damages as ancillary relief; its crux — whether prevention of the relocation survey was justified — can be resolved without the alleged owners, who are therefore not indispensable. Respondent and the other defendants are real parties in interest as direct targets of the injunction and alleged tortfeasors. Even assuming indispensability, non-joinder requires an order to implead, with dismissal allowed only upon refusal to comply.

• Preliminary injunction; clear legal right — A writ of preliminary injunction may issue only upon clear showing of an actual existing right to be protected during pendency of the principal action; when complainant's right or title is doubtful or disputed, issuance is improper. Applied to deny relief where registered title was contested and prior possession was neither alleged nor proved.
• Preliminary injunction as preservative remedy; status quo ante — Preliminary injunction preserves the status quo or the last actual, peaceable, and uncontested situation preceding controversy and must not create new relations between parties nor take disputed property from one party to deliver it to another. Applied to hold that enjoining the party in possession in favor of out-of-possession title claimants improperly transferred possession.
• Fait accompli doctrine — When the act sought to be enjoined has already happened or been completed, nothing more can be enjoined or prohibited and injunction will not issue to restrain an act already done. Applied where the security contract had expired and respondent had vacated, rendering the WPI without purpose.
• Real party in interest vs. indispensable vs. necessary party — A real party in interest stands to be benefited or injured by the judgment or is entitled to its avails; an indispensable party is a party in interest without whom no final determination can be had, while a necessary party ought to be joined for complete relief but is not indispensable. Both indispensable and necessary parties are real parties in interest, but examination for real-party defect concerns only whether presently pleaded parties are interested, not whether all interested persons are pleaded. Applied to hold respondent a real party in interest and rival owners not indispensable.
• Non-joinder of indispensable parties — Non-joinder of indispensable parties is not a ground for dismissal; the remedy is to implead the non-party on motion or on the court's own initiative at any just stage, with dismissal permitted only for failure to comply with the order to implead. Applied to reverse outright dismissal of the complaint.
• Cause of action determined by allegations, not caption — The cause of action is defined by the allegations in the body of the complaint, not by its designation or caption, which is not controlling nor indispensable. Applied to treat the denominated damages suit as principally one for injunction with damages as ancillary relief.

• "only upon clear showing of an actual existing right to be protected during the pendency of the principal action" — States the threshold requisite for preliminary injunction and anchors the finding of no clear legal right where title is disputed.
• "preliminary injunction is not a proper remedy to take property out of the possession and control of one party and to deliver the same to the other party where such right is being disputed" — Defines the prohibition against using injunction to transfer disputed possession, central to lifting the writ.
• "the non-joinder of indispensable parties is not a ground for the dismissal of an action" — States the controlling rule on parties that required reversal of the outright dismissal and remand with direction to implead if needed.
• "A real party in interest is the party who stands to be benefited or injured by the judgment of the suit, or the party entitled to the avails of the suit." — Provides the canonical definition used to distinguish real parties from indispensable parties and to sustain respondent's standing as defendant.

• Sps. Plaza vs. Lustiva, G.R. No. 172909, March 5, 2014, 718 SCRA 19, 31 — Cited as authority for the clear-existing-right requirement for preliminary injunction.
• Almeida vs. CA, 489 Phil. 648, 672 (2005); Raspado vs. CA, G.R. No. 104782, March 30, 1993, 220 SCRA 650, 653; Merville Park Homeowners Association, Inc. vs. Velez, 273 Phil. 406, 412 (1991) — Cited to support that injunction is improper to transfer possession where the right is disputed.
• Cortez-Estrada vs. Heirs of Samut, 491 Phil. 458, 472 (2005) — Cited for the status-quo preservative function of preliminary injunction.
• Los Baños Rural Bank, Inc. vs. Africa, 433 Phil. 930, 945 (2002) — Cited to reiterate that injunction must only maintain the status quo until merits are heard.
• Caneland Sugar Corporation vs. Alon, 559 Phil. 462, 471 (2007); Philippine National Bank vs. CA, 353 Phil. 473, 479 (1998); Go vs. Looyuko, 563 Phil. 36, 68 (2007) — Cited for the fait accompli rule barring injunction when the act sought to be prevented has already happened.
• Carandang vs. Heirs of de Guzman, 538 Phil. 319 (2006) — Followed as controlling clarification of real party in interest versus indispensable and necessary parties.
• Plasabas vs. CA, 601 Phil. 669 (2009) — Followed for the rule that non-joinder of indispensable parties requires an order to implead, not dismissal.
• Aguilar vs. O'Pallick, G.R. No. 182280, July 29, 2013, 702 SCRA 455, 465 — Cited for the rule that allegations, not caption, determine the cause of action.
• Philippine Economic Zone Authority vs. Carantes, 635 Phil. 541, 548 (2010) — Cited to characterize the suit as ultimately seeking to enjoin restriction of access.

Sereno, C.J., Leonardo-De Castro, Bersamin, and Jardeleza, JJ., concur.