Yu vs. De Lara

A person who occupies registered 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; failure to do so makes summary ejectment the proper remedy. No possessory rights can be recognized in favor of such occupants, and abandonment cannot be established absent both physical relinquishment and clear intent not to reclaim.

John O. Yu acquired Lot No. 14, Block No. 51-C of the Grace Park subdivision from Philippine Realty Corporation on 28 November 1956, the land having been originally registered in 1916 under O.C.T. No. 868 and later covered by T.C.T. No. 22104 in the corporation's name. The defendants were occupants who had purchased houses built on the land by earlier settlers and remained there without any contract with or rent to the registered owner. The dispute implicated the Torrens system rule under Section 46 of Act No. 496 that no title in derogation of the registered owner may be acquired by prescription or adverse possession, as well as the Civil Code provisions on abandonment and possession. Prior related litigation, G.R. Nos. L-12614 and L-12615, concerned the registration of the defendants' adverse claim over the same property and had been resolved against them by the Land Registration Commissioner.

Lot No. 14, Block No. 51-C of the Grace Park subdivision, with an area of 682.5 meters, is the disputed property. It was originally registered in 1916 under O.C.T. No. 868 of the Registry of Deeds of Rizal, subsequently acquired by Philippine Realty Corporation under T.C.T. No. 22104, and sold by that corporation on 28 November 1956 to John O. Yu, a Filipino citizen, who obtained T.C.T 11267 in his name.

In 1945, several persons settled on the property and constructed houses thereon without permission from, or contract with, Philippine Realty Corporation, then the registered owner. On various dates thereafter, between 1947 and 1952, Maximo de Lara, Juan Panlilio, Lucia Rivero, Florentino Roque, and Domingo Samson bought the houses of those settlers and continued in occupancy thereof without paying any rents to the owner of the land.

In February 1957, Yu advised them in writing to vacate within 30 days. In view of their refusal, he filed a complaint for unlawful detainer within the statutory period of one year.

The courts treated the defendants as squatters who had settled on the land without any agreement with the owner, paid neither rents to him nor land taxes to the government, and impliedly recognized their squatters' status by purchasing only the houses built by the original settlers. Their occupancy was at the owner's sufferance, and their acts were merely tolerated.

• Abandonment: Defendants-appellants argued that Philippine Realty Corporation had lost possession of the property by abandonment under Article 555, paragraph 1, of the Civil Code because it failed to take action against them and showed lack of interest in the property since they started their occupancy.
• Unlawful Detainer and Implied Promise: Defendants-appellants contended that, absent any showing of an express or implied promise on their part to return the land to appellee, or that they failed to do so after their right to retain it had expired, they could not be considered unlawfully withholding possession within the meaning of Section 1 of Rule 72; the implication was that the unlawful detainer action was improperly brought in the Justice of the Peace Court of Caloocan.
• Prejudicial Question: Defendants-appellants contended that the Court of First Instance lacked jurisdiction because there were prejudicial questions pending before the Supreme Court in G.R. Nos. L-12614 and L-12615 concerning the same property, specifically the propriety of the registration of their adverse claim, which the Land Registration Commissioner had resolved against them.

• Abandonment: Whether Philippine Realty Corporation lost possession of the property by abandonment under Article 555, paragraph 1, of the Civil Code, thereby defeating the registered owner's right to possession.
• Unlawful Detainer and Implied Promise: Whether defendants-appellants could be considered unlawfully withholding possession under Section 1 of Rule 72 absent an express or implied promise to return the land, and whether the Justice of the Peace Court had jurisdiction over the ejectment action.
• Prejudicial Question: Whether the Court of First Instance lacked jurisdiction because of prejudicial questions pending in G.R. Nos. L-12614 and L-12615 concerning the registration of defendants-appellants' adverse claim.

• Abandonment: No. The circumstances were insufficient to constitute abandonment, which requires both physical relinquishment and a clear intention not to reclaim or reassume ownership or enjoyment; abandonment cannot apply to land, especially registered land, and no possessory rights can be recognized in favor of squatters whose occupancy was merely tolerated.
• Unlawful Detainer and Implied Promise: No. A person occupying the land of another at the latter's tolerance or permission, without any contract, is bound by an implied promise to vacate upon demand; failure to do so makes summary ejectment the proper remedy. The jurisdiction question was not raised in the Justice of the Peace Court, and the Court of First Instance could take cognizance of the case under Section 11 of Rule 40.
• Prejudicial Question: No. The issue in the pending cases was not prejudicial because it could not affect appellee's right to possess the land; moreover, those cases had already been decided on January 29, 1960, upholding the action of the Land Registration Commissioner.

• Abandonment: Article 555, paragraph 1, of the Civil Code requires not only physical relinquishment of the thing but also a clear intention not to reclaim or reassume ownership or enjoyment. The circumstances alleged—failure to take action and lack of interest—were insufficient. According to Manresa (Vol. 4, 5th ed., p. 277), abandonment converts the thing into res nullius, ownership of which may be acquired by occupation; this can hardly apply to land, since occupation is not available under Article 714 of the Civil Code, and even less to registered land, because under Section 46 of Act No. 496 no title in derogation of the registered owner may be acquired by prescription or adverse possession. Defendants-appellants were squatters who settled on the land without any agreement with the owner, paid neither rents nor land taxes, and impliedly recognized their squatters' status by purchasing only the houses built by the original settlers. Their occupancy was at the owner's sufferance, and their acts were merely tolerated, which could not affect the owner's possession under Articles 537 and 1119 of the Civil Code.
• Unlawful Detainer and Implied Promise: The argument that no express or implied promise to return the land existed, or that they failed to return it after their right to retain it expired, implied that the unlawful detainer action was improperly brought in the Justice of the Peace Court. 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 to vacate upon demand; failing that, summary ejectment is the proper remedy. In any event, whatever might be said regarding the original jurisdiction of the Justice of the Peace Court—and hence the appellate jurisdiction of the Court of First Instance—the question was not raised in the former court at all. Consequently, the Court of First Instance could take cognizance of the case as one for recovery by the owner of the right of possession in the exercise of its original jurisdiction, pursuant to Section 11 of Rule 40.
• Prejudicial Question: The issue in G.R. Nos. L-12614 and L-12615 was the propriety of the registration of defendants-appellants' adverse claim to the land, which the Land Registration Commissioner had resolved against them. That issue was not prejudicial in nature: it could not affect appellee's right to possess the land, which had nothing to do with the registration or non-registrability of the alleged adverse claim. Additionally, those cases had already been decided on January 29, 1960, upholding the action of the Land Registration Commissioner.

• Abandonment (Article 555, Civil Code) — Abandonment requires not only physical relinquishment of the thing but also a clear intention not to reclaim or reassume ownership or enjoyment thereof. It converts the thing into res nullius, ownership of which may be acquired by occupation; this mode is unavailable for land under Article 714 and cannot defeat the title of a registered owner under Section 46 of Act No. 496. In this case, the registered owner's failure to act against the occupants did not constitute abandonment.
• Registered land and adverse possession — Under Section 46 of Act No. 496, no title in derogation of that of the registered owner may be acquired by prescription or adverse possession. The Court applied this rule to reject any possessory right in favor of the defendants-appellants over the registered land.
• Possession by tolerance and implied promise to vacate — 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; failure to do so makes summary ejectment the proper remedy. The Court applied this to hold the defendants-appellants liable in unlawful detainer.
• Squatters' occupancy — Occupancy by squatters who settled on the land without any agreement with the owner, paid neither rents nor land taxes, and purchased only the houses built by original settlers is at the owner's sufferance and merely tolerated; such acts cannot affect the owner's possession under Articles 537 and 1119 of the Civil Code.
• Prejudicial question — An issue is not prejudicial if it cannot affect the right to possess the land in the ejectment case; and a pending case becomes moot for purposes of the ejectment action once it has already been decided. The Court applied this to reject the jurisdictional challenge based on G.R. Nos. L-12614 and L-12615.

• "The circumstances adverted to are insufficient to constitute abandonment, which requires not only physical relinquishment of the thing but also a clear intention not to reclaim or reassume ownership or enjoyment thereof." — States the controlling requisites of abandonment and explains why the registered owner's inaction did not defeat its possession.
• "No possessory rights whatsoever can be recognized in favor of appellants, because they are in fact nothing but squatters, who settled on the land without any agreement with the owner paying neither rents to him, nor land taxes to the government, and who impliedly recognized their squatters' status by purchasing only the houses built by the original settlers." — Defines the defendants-appellants' legal status as squatters and supports the denial of any possessory rights.
• "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 fiction for ejectment is the property remedy against him." — Articulates the implied promise to vacate and the availability of summary ejectment against occupants by tolerance; the quotation reproduces the text's wording, including apparent typographical errors.

• G.R. Nos. L-12614 and L-12615 — Prior related cases concerning the same property and the registration of appellants' adverse claim; the Supreme Court had already decided them on January 29, 1960, upholding the Land Registration Commissioner. They were cited to show that no prejudicial question remained.

• Article 555, paragraph 1, Civil Code — Defines abandonment; the Court held the circumstances did not satisfy its requisites.
• Article 714, Civil Code — Provides that occupation is not a mode of acquiring ownership of land; cited to show abandonment's res nullius theory cannot apply to land.
• Section 46, Act No. 496 — Provides that no title in derogation of the registered owner may be acquired by prescription or adverse possession; applied to registered land in rejecting defendants-appellants' possessory claims.
• Articles 537 and 1119, Civil Code — Concern possession and tolerance; cited to hold that defendants-appellants' occupancy at the owner's sufferance and merely tolerated acts could not affect the owner's possession.
• Section 1, Rule 72 — Defines unlawful withholding of possession for unlawful detainer; the Court rejected the argument that absence of an express or implied promise to return the land precluded liability.
• Section 11, Rule 40 — Provides for the Court of First Instance's original jurisdiction over recovery of the right of possession; applied to uphold the CFI's cognizance of the case despite the jurisdictional challenge.

Justices Padilla, Bautista Angelo, Labrador, Concepcion, J.B.L., Barrera, Paredes, Dizon, and Regala concurred. Chief Justice Bengzon took no part.