Government Service Insurance System v. Espenilla

FIRST DIVISION

[G.R. No. 203267. October 6, 2021.]

GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS), petitioner, vs.MERLINDA ESPENILLA, respondent.

NOTICE

Sirs/Mesdames :

Please take notice that the Court, First Division, issued a Resolution dated October 6, 2021 which reads as follows:

"G.R. No. 203267 (Government Service Insurance System (GSIS) v. Merlinda Espenilla). ؅— This is a Petition for Review on Certiorari1 assailing the November 25, 2011 Decision 2 and August 28, 2012 Resolution 3 of the Court of Appeals (CA) in CA-G.R. SP No. 100812 which dismissed the case for Unlawful Detainer filed by the GSIS, and subsequently denied its motion for reconsideration.

ANTECEDENTS

A complaint for ejectment was filed by GSIS against Pio A. Vasquez (Pio) and all persons claiming rights under him over a residential property located at Block 2, Lot 23, Adelina Complex II, San Vicente, San Pedro, Laguna covered by Transfer Certificate of Title (TCT) No. T-133999. GSIS alleged that it acquired the property from La Paz Housing & Development Corporation under a Deed of Absolute Sale with Assignment, by which the latter assigned, ceded, sold and conveyed to GSIS all of its rights, interest and participation in the property. On August 14, 1985, GSIS and Pio entered into a Deed of Conditional Sale over the property. However, Pio failed to pay his monthly amortizations prompting GSIS to send him a notarized notice of cancellation. Subsequently, a notice to vacate was sent on November 24, 2005. 4

As then occupants of the property, Spouses Floro and Merlinda Espenilla were served with summons, but they refused to receive it claiming that they had already bought the property from Pio. In the Answer with Counterclaim, signed by Merlinda, she alleged that the complaint is defective for its failure to demonstrate jurisdictional requirements in an action for unlawful detainer. She claimed ownership of the property by virtue of a Deed of Absolute Sale between her and Pio. It was further alleged that GSIS is guilty of laches, and that prescription had set in. 5

After finding sufficient compliance with the requirements on ejectment cases, the Municipal Trial Court (MTC) of San Pedro, Laguna ruled that GSIS was able to show that it is the registered owner of the property, which it subsequently assigned to Pio. However, the agreement between GSIS and Pio was terminated when Pio failed to fulfill his contractual obligations. A notice to vacate was sent to Pio, and within one year from notice, the complaint was filed. Merlinda's possession of the property, although valid at the outset, became unlawful after GSIS terminated its contract with Pio. Thus, in its February 19, 2007 Decision, 6 the MTC ruled in favor of GSIS, to wit: CAIHTE

WHEREFORE, premises considered, judgment is hereby rendered in favor of plaintiff GSIS and against PIO A. VASQUEZ and all persons claiming rights and authority from him, ordering all the defendants to:

1. Vacate and peacefully surrender possession to the plaintiff the premises located at Block 2, Lot 23, Adelina Complex II, San Vicente, San Pedro, Laguna;

2. [Pay] Attorney's fees of P20,000.00 consistent and pursuant to the doctrine of quantum meruit, plus

3. Costs of suit.

SO ORDERED. 7

Aggrieved, Merlinda filed an appeal before the Regional Trial Court (RTC), which affirmed the ruling of the MTC that Pio and Merlinda's occupation of the property became by mere tolerance of GSIS upon the default of Pio to pay his obligations to GSIS. It is not required that the notice to vacate should have been actually received by Merlinda. Moreover, Merlinda's contention, that her possession has ripened into ownership since she had been in actual and physical possession of the property for 15 years, is misplaced considering that prescription cannot run against a property registered under the Torrens System. 8

On review, the CA, in its November 25, 2011 Decision, 9 reversed the trial courts' rulings, and dismissed GSIS' complaint on the ground of prescription of action. The CA declared that GSIS failed to timely file its complaint since it was not proven that the July 22, 2005 notice to vacate was sent only on November 24, 2005.

Failing to secure a reconsideration, 10 The GSIS filed the present petition 11 ascribing grave abuse of discretion on the CA in dismissing the ejectment case on the ground of prescription. GSIS asserts that the complaint was filed within one year from the unlawful deprivation or withholding of possession of its property well within the one-year period from the date of last demand on November 24, 2005. The list of letters for mailing transmitted to the Post Office proved that the notice to vacate was sent on November 24, 2005. The CA erroneously resolved these factual issues, which have already been passed upon by the trial courts. On the other hand, Merlinda failed to file a comment on the petition despite repeated notice. Accordingly, the filing of a comment was deemed waived. 12

RULING

We deny the petition. The dismissal of GSIS' complaint for unlawful detainer against Merlinda is sustained on the ground of jurisdictional defects in the complaint, but not on the ground of prescription of action as found by the CA.

In Eversley Childs Sanitarium v. Sps. Barbona, 13 the Court stated that:

There are three remedies available to one who has been dispossessed of property: (1) an action for ejectment to recover possession, whether for unlawful detainer or forcible entry; (2) accion publiciana or accion plenaria de posesion, or a plenary action to recover the right of possession; and (3) accion reivindicatoria, or an action to recover ownership.

Although both ejectment and accion publiciana are actions specifically to recover the right of possession, they have two (2) distinguishing differences. The first is the filing period. Ejectment cases must be filed within one (1) year from the date of dispossession. If the dispossession lasts for more than a year, then an accion publiciana must be filed. The second distinction concerns jurisdiction. Ejectment cases, being summary in nature, are filed with the Municipal Trial Courts. 14 (Citation omitted.)

Accion publiciana, however, should be brought in the proper inferior court or the RTC depending on the value of the property. 15

Particularly, an action for unlawful detainer exists when a person unlawfully withholds possession of any land or building against or from a lessor, vendor, vendee or other persons, after the expiration or termination of the right to hold possession by virtue of any contract, express or implied. Where possession by a party was originally legal, as it was permitted by the other party on account of an express or implied contract between them, the possession can become illegal when the other party demands that the possessor vacate the subject property and the possessor refuses to heed the demand. This is because after a demand to vacate, the right to possess is terminated. 16 Alternatively, possession of a property belonging to another may be tolerated or permitted, even without a prior contract between that parties, as long as there is an implied promise that the occupant will vacate upon demand. Refusal to vacate despite demand will give rise to an action for summary ejectment. 17

Jurisdiction over an ejectment case is conferred by law and determined by the allegations in the complaint. 18 Regardless of whether the plaintiff is entitled to recover upon all or some of the claims asserted, jurisdictional facts must be shown on the face of the complaint. 19 To make a case for unlawful detainer, the complaint must allege that: (1) initially, the defendant lawfully possessed the property, either by contract or by plaintiff's tolerance; (2) the plaintiff notified defendant that his right of possession is terminated; (3) the defendant remained in possession and deprived plaintiff of its enjoyment; and (4) the plaintiff filed the complaint within one year from the last demand on defendant to vacate the property. 20 Here, the pertinent portions of GSIS' complaint alleged: DETACa

3. [GSIS] is the owner/assignee of a residential lot x x x. [GSIS] acquired the subject property from La Paz Housing & Development Corporation, as evidenced by the Deed of Absolute Sale with Assignment (DASA) x x x[;]

4. Under the DASA, the said developer assigned, ceded, sold and conveyed in favor of [GSIS] all its rights, interests and participation in the subject property and all its rights, interests and participation under the Deed of Conditional Sale ("DCS") it executed with [Pio] x x x[;]

6. For a period of several years, [Pio]' failed and refused to pay the prescribed monthly amortization and continued to fail and refuse to pay during the grace period given. As a result, [GSIS] sent him/her a Notarized Notice of Cancellation x x x[;]

7. Further, as a result of [Pio]'s refusal to pay his amortization or to re-structure his account within the prescribed period, a Notice to Vacate was sent to [Pio] on November 24, 2005 x x x[;]

8. On March 13, 2006[,] the Project Monitoring Staff of [GSIS] conducted an ocular inspection and found out that [Pio] has not yet vacated the said premises.

9. At this juncture, [GSIS] is continually being deprived of its right to possess the premises by [Pio]'s continued refusal to vacate despite receipt of said notice.

[xxx xxx xxx]

14. x x x Thus, while [Pio]'s possession of the subject property was initially lawful, it subsequently became unlawful. 21 (Citation omitted.)

GSIS, as the owner of the property, assigned its rights and interests to Pio. However, due to his default in his obligations, GSIS cancelled the agreement. Considering the cancellation of the agreement, Pio lost his right to further assign his rights and interests over the lot. In effect, Merlinda, who derives her occupation from the rights of Pio and without any contract with GSIS, is bound by an implied promise to vacate upon demand. Thus, her occupation of the property can only be by mere tolerance of GSIS. Nonetheless, in order for GSIS to successfully prosecute its case for unlawful detainer against Merlinda, it is imperative to sufficiently allege jurisdictional facts. Notably, GSIS filed its complaint against Pio and all persons claiming rights under him. However, the allegations in the complaint fall short to show that Merlinda validly possessed the property and that her occupation was later on tolerated by GSIS. The absence of these details is fatal to the cause of action of GSIS.

"It cannot be gainsaid that the fact of tolerance is of utmost importance in an action for unlawful detainer." 22 At the outset, the plaintiff must allege that the defendant's possession was initially lawful. Afterwards, should the plaintiff claim that possession was by mere tolerance, then the acts of tolerance must also be asserted and proved. A bare allegation of tolerance will not suffice. At least, the plaintiff must point to the overt acts indicative of his/her permission to occupy the disputed property. Failing in this regard, the occupant's possession could be deemed to have been illegal from the beginning, and an action for unlawful detainer will fail. 23 In this case, GSIS' complaint lacks any indication that Merlinda is in possession of the property, and that she holds it by mere tolerance of GSIS. Neither was it shown that GSIS notified her that the right of possession was terminated.

The importance of making a demand cannot be overemphasized, as it is jurisdictional in nature. Under Section 1, Rule 70 of the Rules of Court, the one-year reglementary period for filing an unlawful detainer case is counted from the time of the unlawful deprivation or withholding of possession. Such unlawful deprivation occurs upon expiration or termination of the right to hold possession, and such right expires or terminates upon receipt of the last demand to vacate. 24 Clearly, the one year prescriptive period for filing a case for unlawful detainer is tacked from the date of last demand. 25 Here, the complaint was filed on August 3, 2006. 26 GSIS claims that the notice to vacate, dated July 22, 2005, was sent by registered mail on November 24, 2005. However, GSIS did not prove service of the notice, and its receipt by Pio or Merlinda. Without a demand to vacate, it cannot be determined if the action was filed within the prescribed period. Accordingly, the CA erroneously dismissed GSIS' complaint on the ground of prescription.

"The one-year period within which to commence an ejectment proceeding is a prescriptive period as well as a jurisdictional requirement. 27 Incidentally, a court's jurisdiction may be raised at any stage of the proceedings, even on appeal because jurisdiction is conferred by law, and lack of it affects the very authority of the court to take cognizance of and to render judgment on the action. 28 From the foregoing, there is no basis for the action for unlawful detainer. Absent the allegations of jurisdictional facts, the MTC failed to acquire jurisdiction to take cognizance of the complaint filed by GSIS. The inescapable conclusion is to dismiss the case based on lack of jurisdiction. 29 It is noteworthy to repeat that jurisdiction over the subject matter is conferred only by law. It is not within the courts, let alone the parties, to themselves determine or conveniently set aside. Neither would the active participation of the parties nor estoppel operate to confer original and exclusive jurisdiction where the court only wields appellate jurisdiction over the case. 30

By its nature, an ejectment case only resolves the issue of who has the better right of possession over the property. The right of possession in this instance refers to actual, physical or material possession, not legal possession, and independent of any claim or ownership set forth by any of the party-litigants. 31 We thus stress the Court's pronouncement in Javelosa v. Tapus, 32 to wit: aDSIHc

As a final note, an important caveat must be laid down. The Court's ruling should not in any way be misconstrued as coddling the occupant of the property, at the expense of the lawful owner. Rather, what this resolution seeks to impress is that even the legal owner of the property cannot conveniently usurp possession against a possessor, through a summary action for ejectment, without proving the essential requisites thereof. Accordingly, should the owner choose to file an action for unlawful detainer, it is imperative for him/her to first and foremost prove that the occupation was based on his/her permission or tolerance. Absent which, the owner would be in a better position by pursuing other more appropriate legal remedies. As eloquently stated by Associate Justice Lucas P. Bersamin in the case of Quijano [v. Atty. Amante, 745 Phil. 40 (2014)], "the issue of possession between the parties will still remain. To finally resolve such issue, they should review their options and decide on their proper recourses. In the meantime, it is wise for the Court to leave the door open to them in that respect. For now, therefore, this recourse of the petitioner has to be dismissed."33 (Citation omitted.)

WHEREFORE, the petition is DENIED. The November 25, 2011 Decision and the August 28, 2012 Resolution of the Court of Appeals in CA-G.R. SP No. 100812 are AFFIRMED with MODIFICATION in that the complaint for Unlawful Detainer filed by the Government Service Insurance System against Pio A. Vasquez and all persons claiming rights under him is DISMISSED on the ground of lack of jurisdiction.

SO ORDERED."

By authority of the Court:

(SGD.) LIBRADA C. BUENADivision Clerk of Court

By:

MARIA TERESA B. SIBULODeputy Division Clerk of Court

 

Footnotes

1.Rollo, pp. 9-21.

2.Id. at 26-38. Penned by Associate Justice Amelita G. Tolentino, with the concurrence of Associate Justices Ramon R. Garcia and Samuel H. Gaerlan (now a member of the Court).

3.Id. at 41-42.

4.Id. at 12-13.

5.Id. at 13.

6.Id. at 43-46. Rendered by Acting Presiding Judge Elpidio R. Calis, Branch 2.

7.Id. at 46.

8.Id. at 47-50. The case was raffled to Branch 31, RTC, San Pedro, Laguna, and the decision was penned by Judge Sonia T. Yu-Casano on August 17, 2007.

9.Id. at 26-38. The dispositive portion states:

WHEREFORE, premises considered, the instant petition is GRANTED. The decision of the Regional Trial Court and Municipal Trial Court are REVERSED and SET ASIDE. The complaint for unlawful detainer filed by the respondent with the MTC is DISMISSED on the ground of prescription.

SO ORDERED. (Id. at 37-38.)

10.Id. at 41-42.

11.Id. at 9-21.

12.Id. at 68.

13. 829 Phil. 111 (2018).

14.Id. at 136.

15.The Heirs of Alfredo Cullado v. Gutierrez, G.R. No. 212938, July 30, 2019, as cited in Macutay v. Samoy, G.R. No. 205559, December 2, 2020. See also Regalado v. Vda de la Pena, 822 Phil. 705, 714 (2017).

16.Mirallosa v. Carmel Development, Inc., 722 Phil. 286, 295 (2013).

17.Cruz v. Sps. Christensen, 819 Phil. 379, 391 (2017).

18.Sps. Erorita v. Sps. Dumlao, 779 Phil. 23, 28 (2016).

19.Intramuros Administration v. Offshore Construction Dev't. Co., 827 Phil. 303, 324 (2018); and Anama v. Citibank, N.A., 822 Phil. 630, 640 (2017).

20.Intramuros Administration v. Offshore Construction Dev't. Co., supra; and Sps. Erorita v. Sps. Dumlao, supra note 18.

21.Rollo, p. 33.

22.Javelosa v. Tapus, 835 Phil. 576, 590 (2018).

23.Id., citing Quijano v. Atty. Amante, 745 Phil. 40 (2014).

24.Villaluz v. CA, 344 Phil. 77, 88 (1997).

25.Mirallosa v. Carmel Development, Inc., supra note 16, at 296.

26.Id. at 36. Note, however, that in the RTC Decision, it was mentioned that the complaint was filed on July 31, 2006. (Id. at 48.)

27.Sps. Barnachea v. Hon. Court of Appeals, 581 Phil. 337, 349 (2008).

28.Zacarias v. Anacay, 744 Phil. 201, 213 (2014).

29. See De Guzman-Fuerte v. Sps. Estomo, 830 Phil. 653, 665 (2018).

30.Id. at 668.

31.Catedrilla v. Sps. Lauron, 709 Phil. 335, 348 (2013).

32.Supra note 22.

33.Supra at 593.