Republic of the
Supreme Court
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SPOUSES SHEIKDING BOOC |
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G.R. No. 157806 |
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and BILY BOOC, |
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Petitioners, |
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Present: |
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YNARES-SANTIAGO,
J., |
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Chairperson, |
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- versus - |
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AUSTRIA-MARTINEZ, |
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CHICO-NAZARIO, |
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NACHURA, and |
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REYES, JJ. |
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FIVE STAR MARKETING CO., |
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INC., |
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Promulgated: |
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Respondent. |
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November
22, 2007 |
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D E C I S I O
N
AUSTRIA-MARTINEZ,
J.:
Before the Court is a Petition for Review
on Certiorari under Rule 45 of the Rules of Court assailing the
Decision[1] of the Court
of Appeals (CA) dated
On
x x x x
2. That
plaintiff is the owner of the land and building situated in
3. That
defendants are the present occupants of the 3rd floor
premises of the building, who were allowed to live temporarily in the premises
for free;
4. That
on March 15, 1999 the plaintiff notified all building occupants that it had
withdrawn the privilege granted (rental free) to them coupled with a notice of
rental rates in each premises concerned, and further required to any interested
occupants to negotiate and sign a lease agreement with plaintiff;
5. That the defendants were notified that the
rental for the 3rd floor premises is P40,000.00 per month
effective April 1, 1999, and if he desires to lease, he should enter a lease
contract before such date;
6. That
plaintiff has given more than enough time for the defendants either to vacate
or lease the said premises, but the latter still ignored the demand, so that on
June 28, 1999, a letter of demand to vacate the premises was sent to the
defendants;
7. That
the defendants have failed and refused, and still fails and refuses, to vacate
the premises up to the present time despite repeated demands;
x x x x[2]
In their Answer,[3] petitioners
contended that Five Star has no cause of action against them as they are
actually the owners of the portion of the building that they are occupying;
that the said property is owned in common by petitioner Sheikding
and his brother, Rufino Booc;
that the complaint for unlawful detainer is a mere
offshoot of two complaints earlier filed before the Securities and Exchange
Commission (SEC) in Cagayan de Oro
City by Sheikding and his son James, the first of
which is against the board of directors of Five Star, questioning,
among others, the validity of the election of the members of the said board; and second, a
criminal complaint for falsification of public documents against Salvador Booc, in his capacity as the President of Five Star. The
spouses Booc filed a counterclaim for damages.
Thereafter,
the parties filed their respective Position Papers.
On
WHEREFORE, judgment is hereby
rendered in favor of the defendants [herein petitioners] and against the
plaintiff [herein respondent], dismissing the above-entitled case and ordering
the plaintiff to pay the defendants the following sum of money:
a) P40,000.00 – As moral damages
b) 25,000.00 – As attorney's fee; and
c) 1,000.00 – As appearance fee.
The counterclaim for exemplary
damages is denied for lack of merit.
SO ORDERED.[4]
Petitioners
appealed to the Regional Trial Court (RTC) of Lanao del Norte. In its
Decision dated
WHEREFORE, premises considered, the following reliefs are granted:
a.) The Court declares that
plaintiff [herein respondent] has no cause of action against defendants [herein
petitioners], hence the instant action is ordered dismissed. The same is true
with the claim of plaintiff for damages registered in its pleading.
b) The moral damages and attorney's
fees asserted by defendants are granted for this is sustained by the evidence
on record, and in addition therefor exemplary damages
is also awarded in favor of defendants and against the plaintiff in the
conservative sum of Ten Thousand Pesos (P10,000.00).
SO ORDERED.[5]
Aggrieved by the judgment of
the RTC, respondent filed a petition for review with the CA. On
WHEREFORE, the instant petition is
hereby GRANTED. The assailed decision of the Regional Trial Court, Branch V, Iligan City dated April 6, 2001 is hereby ANNULLED and SET
ASIDE. It is therefore ORDERED that:
1. respondents [herein
petitioners] and other persons claiming rights under them vacate the premises
in question, and return the possession thereof to petitioner [herein
respondent]; and
2. respondents pay the
petitioner the amount of P40,000.00 for every month
that they occupied the premises, beginning April 1999 until the same is
surrendered to the petitioner.
SO ORDERED.[6]
The petitioners filed a Motion for Reconsideration but
the same was denied by the CA in its Resolution of
Hence,
the instant petition with the following assignment of errors:
[1] The Court of Appeals erred in not dismissing
the Petition filed before it as the
herein respondent failed to attach to its petition pleadings and other material
portions of the records to support the allegations in the petition.
[2] The Court of Appeals erroneously relied on
evidence that were not presented by herein respondent at the MTCC but were only
presented for the first time on appeal at the RTC.
[3] The Court of Appeals erred in holding that
there is no evidence to prove the existence of the implied trust; and
[4] The Court of Appeals erred in directing the
petitioners to pay rental at the exorbitant amount of P40,000.00 per month.[8]
Parties filed their respective Memoranda.[9]
The Court finds the petition partly
meritorious.
The first assigned error is not
plausible. The Court, in Atillo
v. Bombay,[10] interpreted the provisions of Section 2(d),
Rule 42 of the Rules of Court and ruled as follows:
The phrase “of the pleadings and other material portions of the record” in Section 2(d), Rule 42 is followed by the phrase “as would support the allegations of the petition” clearly contemplates the exercise of discretion on the part of the petitioner in the selection of documents that are deemed to be relevant to the petition. However, while it is true that it is petitioner who initially exercises the discretion in selecting the relevant supporting documents that will be appended to the petition, it is the CA that will ultimately determine if the supporting documents are sufficient to even make out a prima facie case. It can be fairly assumed that the CA took pains in the case at bar to examine the documents attached to the petition so that it could discern whether on the basis of what have been submitted it could already judiciously determine the merits of the petition x x x[11]
Thus,
in the present case, the Court finds no reversible error that can be attributed
to the CA in choosing to proceed and decide the petition filed before it on the
basis of what had been submitted by the parties.
The
second assigned error is likewise untenable. Petitioners contend that the CA erred in
relying on evidence that were presented by respondent for the first time when
the case was appealed to the RTC. Petitioners refer to the Joint Affidavit,[12] dated
December 1, 1999, executed by Teodora Abarca del Mar (Teodora) and Preciosa Abarca Talamera (Preciosa) repudiating
their claim in their earlier Joint Affidavit,[13] dated
November 18, 1999, that it was petitioner Sheikding
and his brother Rufino who paid for the subject lot.
The
Court agrees with petitioners that the Joint Affidavit of Teodora
and Preciosa dated
Nonetheless,
the CA adequately explained in its presently assailed Resolution, denying
petitioners' motion for reconsideration, that its Decision was arrived at not
only on the basis of the above-mentioned Joint Affidavit but after a consideration of other factors,
to wit:
(a) that
no evidence was adduced to prove that respondents purchased the lot, and
constructed the building in question with their own money; and
(b) the subject lot was titled in the name of petitioner, and that both land and building are declared in the latter's name for purposes of taxation.[15]
The
resolution of the third assigned error boils down to a determination of who between petitioners and respondent is entitled to the
physical possession of the subject properties.
Both
parties anchor their right of material possession of the disputed lot and
building on their respective claims of ownership.
In
Arambulo v. Gungab[16], this Court held:
The
sole issue for resolution in an unlawful detainer
case is physical or material possession. But even if there was a claim of
juridical possession or an assertion of ownership by the defendant, the MTCC
may still take cognizance of the case. All that the trial court can do is to
make an initial determination of who is the owner of the property so that it
can resolve who is entitled to its possession absent other evidence to resolve
ownership. Courts in ejectment cases decide questions
of ownership only as it is necessary to decide the question of possession. The
reason for this rule is to prevent the defendant from trifling with the summary
nature of an ejectment suit by the simple expedient
of asserting ownership over the disputed property.[17]
In
addition, it is a basic rule in civil cases that the party having the burden of
proof must establish his case by a preponderance of evidence.[18]
Preponderance
of evidence simply means evidence which is of greater weight, or more convincing than that which is offered in
opposition to it.[19]
In the
present case, the Court finds no cogent reason to depart from the findings of
the CA that respondent has proved, by preponderance of evidence, its claim that
it is the owner of the disputed properties and, therefore, has the right of
material possession over the same.
Petitioners'
claim of co-ownership is anchored on their assertion that it was petitioner Sheikding together with Rufino
who actually purchased the subject lot; that they were also the ones who
financed the construction of the subject building; and that they paid the taxes
due on the subject properties. Both the MTCC and the RTC gave credence to the
allegations of petitioners.
In claiming
that the subject lot and building were bought and constructed with the money of
petitioner Sheikding and Rufino,
petitioners, in effect, aver that respondent is merely holding the property in
trust for them.
As a rule, the burden of proving the
existence of a trust is on the party asserting its existence and such proof
must be clear and satisfactorily show the existence of the trust and its
elements.[20]
To prove that
they are co-owners of the disputed lot, petitioners presented the Joint
Affidavit[21] of Teodora and Preciosa, dated
The Affidavit
of Flordeliza D. Villaver[22]
and the letters of Rufino Booc
to Sheikding's son, James Booc
(James), dated
Neither do the
Official Receipts[28]
evidencing petitioner Bily's payment of electric
bills prove that petitioners are co-owners of the subject building. At best, these official receipts only show
that petitioners are in possession of the subject property, which in this case,
is undisputed.
Further,
petitioners failed to present any tax declaration or payment of taxes due on
the subject premises.
On
the other hand, the following documents, some of which were presented in
evidence by petitioners themselves, prove respondent's ownership of the
disputed properties, to wit: Deed of Sale dated
It
is settled that a certificate of title is a conclusive evidence of ownership;
it does not even matter if the title is questionable, the instant action being
an ejectment suit.[34] In addition, the age-old rule is that the
person who has a Torrens Title over a land is entitled to possession thereof.[35]
As
to the tax declarations over the property in the name of respondent, the rule
is that while tax declarations or realty tax payments of property are not
conclusive evidence of ownership, nevertheless, they are good indicia of
possession in the concept of owner for no one in his right mind would be paying
taxes for a property that is not in his actual or at least constructive
possession.[36] They constitute at least proof that the holder
has a claim of title over the property.[37] The voluntary declaration of a piece of
property for taxation purposes manifests not only one’s sincere and honest
desire to obtain title to the property and announces his adverse claim against
the State and all other interested parties, but also the intention to
contribute needed revenues to the Government.[38] Such an act strengthens one’s bona fide claim of acquisition of
ownership.[39]
On the basis
of the foregoing, the Court finds no error in the ruling of the CA that the
preponderance of evidence lies in favor of
respondent's claim of ownership. Surely,
the Deed of Sale, TCT, Tax Declarations and Official Receipts of tax payments
in the name of respondent are more convincing than the evidence submitted by
petitioners.
The Court
stresses, however, that its determination of ownership in the instant case is
not final. It is only a provisional determination for the sole purpose of
settling the issue of possession.[40] It would not bar or prejudice a separate action
between the same parties involving the quieting of title to the subject
property.[41]
As to the last
assigned error, petitioners contend that the monthly rental being charged by
respondent is exorbitant considering that the rentals being paid by James for
his use of one-half of the first floor of the disputed building from September
1995 to August 1998 is only P10,000.00. This is not disputed by
respondent.
In its
assailed ruling, the CA awarded the amount of P40,000.00
as monthly rental for petitioners' use and occupation of the premises, beginning
April 1999 until the same is surrendered to respondent. The award granted by the CA is based on
respondent's prayer in its complaint filed with the MTCC.
It must be stressed, however, that it
was not enough for the respondent as plaintiff in the MTCC to make a claim for
reasonable compensation for the use of its property. The
respondent, as plaintiff therein, had the burden to prove its claim by a
preponderance of evidence, which, as earlier defined, means evidence of greater
weight or more convincing than that which is offered in opposition to it.
Fair rental value is recoverable in
the concept of actual damages.[42] Fair rental
value is defined as the amount at which a willing lessee would pay and a
willing lessor would receive for the use of a certain
property, neither being under compulsion and both parties having a reasonable
knowledge of all facts, such as the extent, character and utility of the
property, sales and holding prices of similar land and the highest and best use
of the property.[43] The rental value refers to the value as
ascertained by proof of how much the
rent would be for the property or by evidence of other facts from which the
fair rental value may be determined.[44] Hence, the plaintiff must offer proof of such
claim.[45]
Section 17, Rule 70 of the 1997 Rules
of Civil Procedure, as amended, clearly provides that the trial court is
empowered to award reasonable compensation for the use and occupation of the
premises sought to be recovered in a forcible entry or unlawful detainer case only if the claim is true. This
Court has held that a court may fix the reasonable amount of rent, but must still
base its action on the evidence adduced by the parties.[46]
In the present case, the CA made no
ratiocination as to how it arrived at the amount of P40,000.00. In fact,
a review of the evidence presented shows that there is no factual or
evidentiary basis to sustain respondent's prayer in its complaint.
However, considering that there is no
dispute that petitioners had been in possession of the subject properties since
1982, it is only just and equitable that they pay a reasonable amount for their
continued use and occupation of the disputed premises from the time a demand
was made for them to vacate the said premises in April 1999 until the same is
returned to respondent.
Considering the undisputed facts that
until August 1998 the rental paid by James for one-half of the subject
building's first floor was P10,000.00, making the rental for the entire first floor
amount to P20,000.00, and the customary business practice that the
higher the floor, the cheaper the rental, the Court finds that the amount of P10,000.00
per month constitutes a fair rental value for the third floor of the subject
building being occupied by herein petitioners.
The rental due respondent, being in
the concept of actual or compensatory damages, shall earn interest in accordance
with this Court's ruling in Eastern Shipping Lines, Inc. v. Court of Appeals,[47] to wit:
I. When an obligation, regardless of its source, i.e., law, contracts, quasi-contracts, delicts or quasi-delicts is breached, the contravenor can be held liable for damages. The provisions under Title XVIII on “Damages” of the Civil Code govern in determining the measure of recoverable damages.
II. With regard particularly to an award of interest, in the concept of actual and compensatory damages, the rate of interest, as well as the accrual thereof, is imposed, as follows:
1. When the obligation is breached, and it consists in the payment of a sum of money, i.e., a loan or forbearance of money, the interest due should be that which may have been stipulated in writing. Furthermore, the interest due shall itself earn legal interest from the time it is judicially demanded. In the absence of stipulation, the rate of interest shall be 12% per annum to be computed from default, i.e., from judicial or extrajudicial demand under and subject to the provisions of Article 1169 of the Civil Code.
2. When an obligation, not constituting a loan or forbearance of money, is breached, an interest on the amount of damages awarded may be imposed at the discretion of the court at the rate of 6% per annum. No interest, however, shall be adjudged on unliquidated claims or damages except when or until the demand can be established with reasonable certainty. Accordingly, where the demand is established with reasonable certainty, the interest shall begin to run from the time the claim is made judicially or extrajudicially (Art. 1169, Civil Code) but when such certainty cannot be so reasonably established at the time the demand is made, the interest shall begin to run only from the date the judgment of the court is made (at which time the quantification of damages may be deemed to have been reasonably ascertained). The actual base for the computation of legal interest shall, in any case, be on the amount finally adjudged.
3. When the judgment of the court awarding a sum of money becomes final and executory, the rate of legal interest whether the case falls under paragraph 1 or paragraph 2, above, shall be 12% per annum from such finality until its satisfaction, this interim period being deemed to be by then an equivalent to a forbearance of credit.[48]
In the instant case, respondent's
extra-judicial demand on petitioners was
made on April 1, 1999.[49] Hence,
from this date, the rentals due from petitioners shall earn interest at 6% per
annum until the judgment in this case becomes final and executory.
After the finality of judgment and until full
payment of the rentals and interests due, the legal rate of interest to be
imposed shall be 12%.
WHEREFORE, the instant petition
is DENIED. The assailed Decision of the Court of Appeals
dated September 30, 2002 and its Resolution dated March 17, 2003 in CA-G.R. SP
No. 64960 are AFFIRMED with MODIFICATION by directing petitioners
to pay respondent the amount of P10,000.00 for every month that they
occupied the subject premises, with 6% interest per annum from April 1, 1999
until finality of this Decision and 12% thereafter, until full
payment.
SO ORDERED.
MA. ALICIA AUSTRIA-MARTINEZ
Associate
Justice
WE CONCUR:
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
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MINITA V. CHICO-NAZARIO Associate Justice |
ANTONIO EDUARDO B. NACHURA Associate Justice |
RUBEN T. REYES
Associate Justice
ATTESTATION
I attest that the conclusions in the above Decision had
been reached in consultation before the case was assigned to the writer of the
opinion of the Court’s Division.
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson, Third Division
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the
Constitution, and the Division Chairperson’s Attestation, it is hereby
certified that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court’s Division.
REYNATO S.
PUNO
Chief Justice
[1] Penned by Justice Eloy R. Bello, Jr. with the concurrence of Justices Buenaventura J. Guerrero and Juan Q. Enriquez, Jr.
[2] Complaint, CA rollo, pp. 27-28.
[3]
[4] CA rollo, p. 52.
[5]
[6] CA rollo, p. 128.
[7]
[8] Rollo, p. 22.
[9]
[10] 404 Phil. 179 (2001).
[11]
[12] CA rollo, p. 60.
[13] Rollo, p. 49.
[14] Corpin v. Vivar, 389 Phil. 355, 363 (2000).
[15] Rollo, p. 338.
[16] G.R. No. 156581,
[17] Arambulo v. Gungab. supra note 16, at 649.
[18] Montañez v. Mendoza, 441 Phil. 47, 56 (2002).
[19]
[20] Tigno v. Court of Appeals, 345 Phil. 486, 499 (1997) citing Morales v. Court of Appeals, G.R. No. 117228, June 19, 1997, 274 SCRA 282, 300.
[21] See note 12.
[22] Rollo, p. 57.
[23]
[24]
[25]
[26]
[27]
[28] Rollo, pp. 60 and 63.
[29]
[30]
[31]
[32]
[33]
[34] Carreon v. Court of Appeals, 353 Phil.271, 282 (1998) citing Dizon v. Court of Appeals, 332 Phil. 429, 434 (1996).
[35] Arambulo v. Gungab, supra note 16, at 649.
[36] Director of Lands v. Court of Appeals, 367 Phil. 597, 604 (1999).
[37]
[38]
[39]
[40] Rosa Rica Sales Center, Inc. v. Ong, G.R. No. 132197,
[41]
[42] Asian Transmission Corporation v. Canlubang Sugar Estates, 457 Phil. 260, 289 (2003).
[43]
[44]
[45]
[46] Asian Transmission Corporation v. Canlubang Sugar Estates, supra note 42, at 290.
[47] G.R. No. 97412,
[48]
[49] See Letter dated