Ocampo vs. Heirs of Dionisio

A judgment rendered in a forcible entry case is conclusive only with respect to possession and does not bar a subsequent action for recovery of possession based on ownership or title, because between a case for forcible entry and an accion reinvindicatoria there is no identity of causes of action. A Torrens certificate of title is indefeasible and binding upon the whole world unless nullified by a court of competent jurisdiction in a direct proceeding, and prescription and laches cannot apply to registered land covered by the Torrens system.

The dispute involves a parcel of land situated in Dalig, Cardona, Rizal, covered by Original Certificate of Title (OCT) No. M-4559 registered in the name of Bernardino U. Dionisio. Dionisio acquired the property on February 10, 1945 when he purchased it from Isabelo Capistrano, and he subsequently obtained a free patent covering the property, with OCT No. M-4559 issued in his name on December 22, 1987. The petitioners, spouses Mario and Carmelita Ocampo, claimed that Carmelita inherited the property from her father and that they had been in possession since 1969. The respondents are the heirs of Dionisio, who died on September 27, 1997, and are represented by Artemio SJ. Dionisio.

Bernardino U. Dionisio purchased a parcel of land in Dalig, Cardona, Rizal from Isabelo Capistrano on February 10, 1945. He thereafter took possession of the property and obtained a free patent covering it, with Original Certificate of Title (OCT) No. M-4559 issued in his name on December 22, 1987. Sometime in 1995, Mario Ocampo constructed a piggery on a portion of the subject property without Dionisio's consent.

On August 28, 1996, Dionisio filed a complaint for forcible entry with the Municipal Trial Court (MTC) of Cardona, Rizal, docketed as Civil Case No. 96-0031, against Mario Ocampo and Felix Ocampo, seeking to recover possession of the portion of his property where the piggery was built. In his answer, Mario denied Dionisio's allegation, claiming that the disputed parcel of land is owned by his wife, Carmelita Ocampo, who inherited it from her father, and that they had been in possession of the property since 1969. On September 12, 1997, the MTC rendered a decision dismissing the forcible entry complaint, opining that Dionisio failed to establish his prior physical possession of the disputed parcel of land. Dionisio's notice of appeal was denied by the MTC on January 26, 1998 for having been filed beyond the reglementary period. Dionisio died on September 27, 1997.

On July 3, 1998, the heirs of Dionisio filed a complaint for recovery of possession with the MTC, docketed as Civil Case No. 98-0006, against the spouses Mario and Carmelita Ocampo, seeking to recover the same portion of the parcel of land subject of the forcible entry case. The respondents averred that the subject property was acquired by Dionisio on February 10, 1945, that he obtained a free patent covering it, and that OCT No. M-4559 was issued in his name on December 22, 1987. They further claimed that sometime in 1995, Mario constructed a piggery on a portion of the subject property without their consent. In their answer, the petitioners maintained that the subject parcel of land is owned by Carmelita, having acquired it through inheritance, and that they had been in possession since 1969. They additionally claimed that the respondents' complaint was barred by res judicata in light of the finality of the decision in the forcible entry case.

On February 18, 2008, the MTC rendered a decision dismissing the complaint for recovery of possession on the ground of res judicata, ruling that the material fact or question in issue in the forcible entry case — recovery of possession — was conclusively settled in the decision dated September 12, 1997, and could not again be litigated in the present action for accion publiciana. On appeal, the RTC reversed the MTC decision, declaring the respondents entitled to possession for being the lawful owners of the lands covered by OCT No. M-4559, ordering the petitioners to vacate the property, remove improvements, and deliver possession to the respondents, and ordering the petitioners to pay ₱10,000.00 as attorney's fees and ₱5,000.00 as litigation expenses. The RTC ruled that the forcible entry case only involves the question of who has a better right to possession, while the recovery of possession case involves ownership as well, and that a judgment in a forcible entry case will not bar an action for recovery of possession based on title or ownership since there is no identity of causes of action. The RTC further held that the respondents established that the subject property is part of the parcel of land covered by OCT No. M-4559 registered in the name of Dionisio, and that the petitioners failed to adduce sufficient evidence to support their claim of ownership.

The petitioners filed a petition for review with the CA, alleging that the RTC erred in setting aside the MTC Decision. They maintained that the finality of the decision in the forcible entry case constitutes res judicata; that the respondents were not able to sufficiently prove their ownership; that OCT No. M-4559 was irregularly issued; and that the respondents' cause of action was barred by laches. On July 2, 2009, the CA affirmed the RTC Decision, holding that res judicata could not be applied since there was no identity of causes of action between the forcible entry case and the recovery of possession case, that the respondents sufficiently established their ownership, and that the respondents' cause of action was not barred by laches. The petitioners' motion for reconsideration was denied on January 27, 2010, prompting the instant petition before the Supreme Court.

• Res Judicata: The petitioners maintained that the finality of the decision in the forcible entry case constitutes res judicata, which would warrant the outright dismissal of the respondents' complaint for recovery of possession.
• Ownership: The petitioners argued that the respondents were not able to sufficiently prove their ownership of the subject property.
• Validity of Title: The petitioners contended that OCT No. M-4559 registered in the name of Dionisio was irregularly issued.
• Laches: The petitioners claimed that the respondents' cause of action in the recovery of possession case was already barred by laches.

N/A — The decision does not separately recount the respondents' arguments beyond their pleadings in the lower courts, which asserted ownership of the subject property as successors-in-interest of Dionisio and sought recovery of possession thereof.

• Res Judicata: Whether the finality of the decision in the forcible entry case constitutes res judicata, which would warrant the dismissal of the respondents' complaint for recovery of possession.
• Ownership: Whether the respondents were able to establish their ownership of the subject property.
• Laches: Whether the respondents' cause of action is already barred by laches.

• Res Judicata: No. The doctrine of res judicata does not apply because, although there is identity of parties and subject matter between the forcible entry case and the recovery of possession case, there is no identity of causes of action. A judgment rendered in a forcible entry case will not bar an action between the same parties respecting title or ownership.
• Ownership: Yes. The respondents were able to prove that they have a superior right over the subject property as against the petitioners, since the subject property is covered by OCT No. M-4559 registered in the name of Dionisio, the respondents' predecessor-in-interest, and a certificate of title serves as evidence of an indefeasible and incontrovertible title.
• Laches: No. As owners of the subject property, the respondents have the right to recover possession thereof from any person illegally occupying their property, and this right is imprescriptible. Prescription and laches cannot apply to registered land covered by the Torrens system.

• Res Judicata: The doctrine of res judicata is laid down under Section 47, Rule 39 of the Rules of Court, which comprehends two distinct concepts: bar by former judgment and conclusiveness of judgment. For bar by prior judgment to apply, the following requisites must concur: (a) finality of the former judgment; (b) the court which rendered it had jurisdiction over the subject matter and the parties; (c) it must be a judgment on the merits; and (d) there must be, between the first and second actions, identity of parties, subject matter and causes of action. The first three requisites were present in this case, but the fourth was not. Although there was identity of parties and subject matter, there was no identity of causes of action. In an action for forcible entry and detainer, the only issue is possession in fact, or physical possession of real property, independently of any claim of ownership. The recovery of possession case, on the other hand, is actually an accion reinvindicatoria — a suit to recover possession of a parcel of land as an element of ownership. The MTC itself, in its Decision dated September 12, 1997, stressed that its determination was limited to the issue of who has "actual prior possession" of the subject property regardless of ownership. The decision in the forcible entry case is conclusive only as to the MTC's determination that the petitioners are not liable for forcible entry since the respondents failed to prove their prior physical possession; it is not conclusive as to the ownership of the subject property. Section 18, Rule 70 of the Rules of Court expressly provides that a "judgment rendered in an action for forcible entry or detainer shall be conclusive with respect to the possession only and shall in no wise bind the title or affect the ownership of the land."

• Ownership: It is undisputed that the subject property is covered by OCT No. M-4559, which is registered in the name of Dionisio, the respondents' predecessor-in-interest. Between the petitioners' unsubstantiated and self-serving claim that the subject property was inherited by Carmelita from her father and OCT No. M-4559 registered in Dionisio's name, the latter must prevail. A certificate of title serves as evidence of an indefeasible and incontrovertible title to the property in favor of the person whose name appears therein, and a person who has a Torrens title over a land is entitled to the possession thereof. A Torrens Certificate of Title is indefeasible and binding upon the whole world unless and until it has been nullified by a court of competent jurisdiction. Under existing statutory and decisional law, the power to pass upon the validity of such certificate of title at the first instance properly belongs to the Regional Trial Courts in a direct proceeding for cancellation of title. Accordingly, the petitioners may not assail the validity of the issuance of OCT No. M-4559 in their answer to the complaint for recovery of possession; it is a collateral attack to the validity of the title, which the RTC and the CA aptly disregarded.

• Laches: As owners of the subject property, the respondents have the right to recover the possession thereof from any person illegally occupying their property. This right is imprescriptible. Assuming arguendo that the petitioners indeed have been occupying the subject property for a considerable length of time, the respondents, as lawful owners, have the right to demand the return of their property at any time as long as the possession was unauthorized or merely tolerated. Jurisprudence consistently holds that prescription and laches cannot apply to registered land covered by the Torrens system because under the Property Registration Decree, no title to registered land in derogation to that of the registered owner shall be acquired by prescription or adverse possession.

• Bar by Prior Judgment — This is one of the two concepts of res judicata under Section 47, Rule 39 of the Rules of Court. It applies when, as between the first case where the judgment was rendered and the second case that is sought to be barred, there is identity of parties, subject matter, and causes of action. In this instance, the judgment in the first case constitutes an absolute bar to the second action. In this case, the Court found that although the first three requisites were present, the fourth requisite — identity of causes of action — was absent, so bar by prior judgment did not apply.

• Conclusiveness of Judgment — This is the second concept of res judicata. Where there is identity of parties in the first and second cases, but no identity of causes of action, the first judgment is conclusive only as to those matters actually and directly controverted and determined, and not as to matters merely involved therein. Any right, fact, or matter in issue directly adjudicated or necessarily involved in the determination of an action before a competent court in which judgment is rendered on the merits is conclusively settled by the judgment therein and cannot again be litigated between the parties and their privies. In this case, the decision in the forcible entry case was conclusive only as to the MTC's determination that the respondents failed to prove prior physical possession; it was not conclusive as to the ownership of the subject property.

• Conclusiveness of Forcible Entry Judgments — Under Section 18, Rule 70 of the Rules of Court, a judgment rendered in an action for forcible entry or detainer shall be conclusive with respect to possession only and shall in no wise bind the title or affect the ownership of the land. The Court applied this doctrine to hold that the forcible entry case did not bar the subsequent recovery of possession case, which was based on ownership.

• Indefeasibility of Torrens Title — A Torrens Certificate of Title is indefeasible and binding upon the whole world unless and until it has been nullified by a court of competent jurisdiction. The power to pass upon the validity of such certificate of title at the first instance properly belongs to the Regional Trial Courts in a direct proceeding for cancellation of title. The Court applied this doctrine to reject the petitioners' collateral attack on the validity of OCT No. M-4559.

• Imprescriptibility of Actions for Registered Land — Prescription and laches cannot apply to registered land covered by the Torrens system because under the Property Registration Decree, no title to registered land in derogation to that of the registered owner shall be acquired by prescription or adverse possession. The Court applied this doctrine to reject the petitioners' claim that the respondents' cause of action was barred by laches.

• "There is 'bar by prior judgment' when, as between the first case where the judgment was rendered and the second case that is sought to be barred, there is identity of parties, subject matter, and causes of action. In this instance, the judgment in the first case constitutes an absolute bar to the second action." — This passage defines the first concept of res judicata and its requisites, which the Court applied to determine that bar by prior judgment did not apply due to lack of identity of causes of action.

• "A judgment rendered in a forcible entry case will not bar an action between the same parties respecting title or ownership because between a case for forcible entry and an accion reinvindicatoria, there is no identity of causes of action." — This states the core ratio decidendi on the res judicata issue, distinguishing forcible entry from accion reinvindicatoria.

• "That a certificate of title serves as evidence of an indefeasible and incontrovertible title to the property in favor of the person whose name appears therein and that a person who has a Torrens title over a land is entitled to the possession thereof are fundamental principles observed in this jurisdiction." — This articulates the fundamental principle on the evidentiary weight of a Torrens title, which the Court applied to uphold the respondents' ownership claim.

• "Jurisprudence consistently holds that 'prescription and laches can not apply to registered land covered by the Torrens system' because 'under the Property Registration Decree, no title to registered land in derogation to that of the registered owner shall be acquired by prescription or adverse possession.'" — This states the rule on the imprescriptibility of actions involving registered land, which the Court applied to reject the laches defense.

• Judge Abelita III vs. P/Supt. Doria, et al., 612 Phil. 1127 (2009) — Cited as controlling precedent explaining the two aspects of res judicata: bar by prior judgment and conclusiveness of judgment.
• Salud Lizo vs. Camilo Carandang, et al., 73 Phil. 649 (1942) — Cited for the principle that in an action for forcible entry and detainer, the only issue is possession in fact, independently of any claim of ownership.
• S.J. Vda. de Villanueva vs. Court of Appeals, 403 Phil. 721, 730 (2001) — Cited for the rule that a judgment rendered in a forcible entry case will not bar an action between the same parties respecting title or ownership.
• Heirs of Jose Maligaso, Sr. vs. Encinas, G.R. No. 182716, June 20, 2012, 674 SCRA 215, 221 — Cited for the principle that a certificate of title serves as evidence of an indefeasible and incontrovertible title.
• Co vs. Militar, 466 Phil. 217, 224 (2004) — Cited for the rule that the power to pass upon the validity of a certificate of title at the first instance belongs to the Regional Trial Courts in a direct proceeding for cancellation of title.
• Jakosalem vs. Barangan, G.R. No. 175025, February 15, 2012, 666 SCRA 138, 150 — Cited for the rule that prescription and laches cannot apply to registered land covered by the Torrens system.
• Hacienda Bigaa, Inc. vs. Chavez, G.R. No. 174160, April 20, 2010, 618 SCRA 559, 576 — Cited for the proposition that Section 47, Rule 39 of the Rules of Court comprehends two distinct concepts of res judicata.
• Selga vs. Brar, G.R. No. 175151, September 21, 2011, 658 SCRA 108, 121 — Cited for the requisites of bar by prior judgment.

• Section 47, Rule 39, Rules of Court — The provision on the effect of judgments or final orders, which the Court applied to determine whether res judicata barred the respondents' complaint for recovery of possession. The Court found that the fourth requisite — identity of causes of action — was not present.
• Section 18, Rule 70, Rules of Court — The provision providing that a judgment rendered in an action for forcible entry or detainer shall be conclusive with respect to possession only and shall in no wise bind the title or affect the ownership of the land. The Court applied this provision to hold that the forcible entry judgment did not bar the recovery of possession case.
• Property Registration Decree — Referenced in the Court's discussion of laches, providing that no title to registered land in derogation to that of the registered owner shall be acquired by prescription or adverse possession.

Presbitero J. Velasco, Jr. (Chairperson), Diosdado M. Peralta, Martin S. Villarama, Jr., and Francis H. Jardeleza concurred with the decision penned by Associate Justice Bienvenido L. Reyes.

N/A — No dissenting opinions were noted in the provided case text.