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2.

That KARGO ENTERPRISES is in the business of, among others,


buying and selling motor vehicles, including hauling trucks and other heavy
SECOND DIVISION equipment;

3. That for the cause of action against defendant ROGER NAVARRO, it


ROGER V. NAVARRO, G.R. No. 153788 is hereby stated that on August 8, 1997, the said defendant leased [from] plaintiff a
Petitioner, certain motor vehicle which is more particularly described as follows

Present: Make/Type FUSO WITH MOUNTED CRANE


CARPIO, J., Chairperson, Serial No. FK416K-51680
- versus - LEONARDO-DE CASTRO, Motor No. 6D15-338735
BRION, Plate No. GHK-378
DEL CASTILLO, and
ABAD, JJ. as evidenced by a LEASE AGREEMENT WITH OPTION TO PURCHASE entered
into by and between KARGO ENTERPRISES, then represented by its Manager,
HON. JOSE L. ESCOBIDO, Presiding Judge, RTC Branch the aforementioned GLENN O. GO, and defendant ROGER NAVARRO xxx; that
37, Cagayan de Oro City, and KAREN T. GO, doing Promulgated: in accordance with the provisions of the above LEASE AGREEMENT WITH
business under the name KARGO ENTERPRISES, OPTION TO PURCHASE, defendant ROGER NAVARRO delivered unto plaintiff six
Respondents November 27, 2009 (6) post-dated checks each in the amount of SIXTY-SIX THOUSAND THREE
HUNDRED THIRTY-THREE & 33/100 PESOS (P66,333.33) which were supposedly
in payment of the agreed rentals; that when the fifth and sixth
checks, i.e. PHILIPPINE BANK OF COMMUNICATIONS CAGAYAN DE ORO
x --------------------------------------------------------------------------------------- x BRANCH CHECKS NOS. 017112 and 017113, respectively dated January 8, 1998
DECISION and February 8, 1998, were presented for payment and/or credit, the same
were dishonored and/or returned by the drawee bank for the common reason that
BRION, J.: the current deposit account against which the said checks were issued did not have
sufficient funds to cover the amounts thereof; that the total amount of the two (2)
This is a petition for review on certiorari[1] that seeks to set aside the Court of Appeals (CA) checks, i.e. the sum of ONE HUNDRED THIRTY-TWO THOUSAND SIX HUNDRED
Decision[2] dated October 16, 2001 and Resolution[3] dated May 29, 2002 in CA-G.R. SP. No. 64701. SIXTY-SIX & 66/100 PESOS (P132,666.66) therefore represents the principal
These CA rulings affirmed the July 26, 2000[4] and March 7, 2001[5] orders of the Regional Trial Court liability of defendant ROGER NAVARRO unto plaintiff on the basis of the provisions
(RTC), Misamis Oriental, Cagayan de Oro City, denying petitioner Roger V. Navarros (Navarro) motion to of the above LEASE AGREEMENT WITH RIGHT TO PURCHASE; that demands,
dismiss. written and oral, were made of defendant ROGER NAVARRO to pay the amount
of ONE HUNDRED THIRTY-TWO THOUSAND SIX HUNDRED SIXTY-SIX &
BACKGROUND FACTS 66/100 PESOS (P132,666.66), or to return the subject motor vehicle as also
provided for in the LEASE AGREEMENT WITH RIGHT TO PURCHASE, but said
On September 12, 1998, respondent Karen T. Go filed two complaints, docketed as Civil Case Nos. 98- demands were, and still are, in vain to the great damage and injury of herein plaintiff;
599 (first complaint)[6] and 98-598 (second complaint),[7]before the RTC for replevin and/or sum of money xxx
with damages against Navarro. In these complaints, Karen Go prayed that the RTC issue writs of replevin 4. That the aforedescribed motor vehicle has not been the subject of any tax
for the seizure of two (2) motor vehicles in Navarros possession. assessment and/or fine pursuant to law, or seized under an execution or an
attachment as against herein plaintiff;
The first complaint stated:
xxx
1. That plaintiff KAREN T. GO is a Filipino, of legal age, married to
GLENN O. GO, a resident of Cagayan de Oro City and doing business under the 8. That plaintiff hereby respectfully applies for an order of the Honorable Court for
trade name KARGO ENTERPRISES, an entity duly registered and existing under the immediate delivery of the above-described motor vehicle from defendants unto
and by virtue of the laws of the Republic of the Philippines, which has its business plaintiff pending the final determination of this case on the merits and, for that
address at Bulua, Cagayan de Oro City; that defendant ROGER NAVARRO is a purpose, there is attached hereto an affidavit duly executed and bond double the
Filipino, of legal age, a resident of 62 Dolores Street, Nazareth, Cagayan de Oro value of the personal property subject matter hereof to answer for damages and
City, where he may be served with summons and other processes of the Honorable costs which defendants may suffer in the event that the order for replevin prayed for
Court; that defendant JOHN DOE whose real name and address are at present may be found out to having not been properly issued.
unknown to plaintiff is hereby joined as party defendant as he may be the person in
whose possession and custody the personal property subject matter of this suit may
be found if the same is not in the possession of defendant ROGER NAVARRO; The second complaint contained essentially the same allegations as the first complaint, except that the
Lease Agreement with Option to Purchase involved is dated October 1, 1997 and the motor vehicle
leased is described as follows:

1
Make/Type FUSO WITH MOUNTED CRANE Navarro likewise faults the lower court for setting the trial of the case in the same order that
Serial No. FK416K-510528 required Karen Go to amend her complaints, claiming that by issuing this order, the trial court violated
Motor No. 6D14-423403 Rule 10 of the Rules.
The second complaint also alleged that Navarro delivered three post-dated checks, each for the amount
of P100,000.00, to Karen Go in payment of the agreed rentals; however, the third check was Even assuming the complaints stated a cause of action against him, Navarro maintains that
dishonored when presented for payment.[8] the complaints were premature because no prior demand was made on him to comply with the
provisions of the lease agreements before the complaints for replevin were filed.
On October 12, 1998[9] and October 14, 1998,[10] the RTC issued writs of replevin for both cases; as a
result, the Sheriff seized the two vehicles and delivered them to the possession of Karen Go. Lastly, Navarro posits that since the two writs of replevin were issued based on flawed
In his Answers, Navarro alleged as a special affirmative defense that the two complaints stated complaints, the vehicles were illegally seized from his possession and should be returned to him
no cause of action, since Karen Go was not a party to the Lease Agreements with Option to Purchase immediately.
(collectively, the lease agreements) the actionable documents on which the complaints were based.
Karen Go, on the other hand, claims that it is misleading for Navarro to state that she has no
On Navarros motion, both cases were duly consolidated on December 13, 1999. real interest in the subject of the complaint, even if the lease agreements were signed only by her
husband, Glenn Go; she is the owner of Kargo Enterprises and Glenn Go signed the lease agreements
In its May 8, 2000 order, the RTC dismissed the case on the ground that the complaints did not state a merely as the manager of Kargo Enterprises. Moreover, Karen Go maintains that Navarros insistence
cause of action. that Kargo Enterprises is Karen Gos paraphernal property is without basis. Based on the law and
jurisprudence on the matter, all property acquired during the marriage is presumed to be conjugal
In response to the motion for reconsideration Karen Go filed dated May 26, 2000,[11] the RTC property. Finally, Karen Go insists that her complaints sufficiently established a cause of action against
issued another order dated July 26, 2000 setting aside the order of dismissal. Acting on the Navarro. Thus, when the RTC ordered her to include her husband as co-plaintiff, this was merely to
presumption that Glenn Gos leasing business is a conjugal property, the RTC held that Karen Go had comply with the rule that spouses should sue jointly, and was not meant to cure the complaints lack of
sufficient interest in his leasing business to file the action against Navarro. However, the RTC held that cause of action.
Karen Go should have included her husband, Glenn Go, in the complaint based on Section 4, Rule 3
of the Rules of Court (Rules).[12] Thus, the lower court ordered Karen Go to file a motion for the inclusion THE COURTS RULING
of Glenn Go as co-plaintiff.
We find the petition devoid of merit.
When the RTC denied Navarros motion for reconsideration on March 7, 2001, Navarro filed a petition
for certiorari with the CA, essentially contending that the RTC committed grave abuse of discretion Karen Go is the real party-in-interest
when it reconsidered the dismissal of the case and directed Karen Go to amend her complaints by
including her husband Glenn Go as co-plaintiff. According to Navarro, a complaint which failed to state
a cause of action could not be converted into one with a cause of action by mere amendment or The 1997 Rules of Civil Procedure requires that every action must be prosecuted or defended
supplemental pleading. in the name of the real party-in-interest, i.e., the party who stands to be benefited or injured by the
On October 16, 2001, the CA denied Navarros petition and affirmed the RTCs order. [13] The CA also judgment in the suit, or the party entitled to the avails of the suit.[15]
denied Navarros motion for reconsideration in its resolution of May 29, 2002,[14] leading to the filing of Interestingly, although Navarro admits that Karen Go is the registered owner of the business name
the present petition. Kargo Enterprises, he still insists that Karen Go is not a real party-in-interest in the case. According to
Navarro, while the lease contracts were in Kargo Enterprises name, this was merely a trade name
THE PETITION without a juridical personality, so the actual parties to the lease agreements were Navarro and Glenn
Go, to the exclusion of Karen Go.
Navarro alleges that even if the lease agreements were in the name of Kargo Enterprises,
since it did not have the requisite juridical personality to sue, the actual parties to the agreement are As a corollary, Navarro contends that the RTC acted with grave abuse of discretion when it
himself and Glenn Go. Since it was Karen Go who filed the complaints and not Glenn Go, she was not ordered the inclusion of Glenn Go as co-plaintiff, since this in effect created a cause of action for the
a real party-in-interest and the complaints failed to state a cause of action. complaints when in truth, there was none.

Navarro posits that the RTC erred when it ordered the amendment of the complaint to include We do not find Navarros arguments persuasive.
Glenn Go as a co-plaintiff, instead of dismissing the complaint outright because a complaint which does
not state a cause of action cannot be converted into one with a cause of action by a mere amendment The central factor in appreciating the issues presented in this case is the business name
or a supplemental pleading. In effect, the lower court created a cause of action for Karen Go when there Kargo Enterprises. The name appears in the title of the Complaint where the plaintiff was identified as
was none at the time she filed the complaints. KAREN T. GO doing business under the name KARGO ENTERPRISES, and this identification was
repeated in the first paragraph of the Complaint. Paragraph 2 defined the business KARGO
Even worse, according to Navarro, the inclusion of Glenn Go as co-plaintiff drastically ENTERPRISES undertakes. Paragraph 3 continued with the allegation that the defendant leased from
changed the theory of the complaints, to his great prejudice. Navarro claims that the lower court gravely plaintiff a certain motor vehicle that was thereafter described. Significantly, the Complaint specifies and
abused its discretion when it assumed that the leased vehicles are part of the conjugal property of attaches as its integral part the Lease Agreement that underlies the transaction between the plaintiff
Glenn and Karen Go. Since Karen Go is the registered owner of Kargo Enterprises, the vehicles subject and the defendant. Again, the name KARGO ENTERPRISES entered the picture as this Lease
of the complaint are her paraphernal properties and the RTC gravely erred when it ordered the inclusion Agreement provides:
of Glenn Go as a co-plaintiff.
This agreement, made and entered into by and between:

2
real party-in-interest, and it is legally incorrect to say that her Complaint does not state a cause of action
GLENN O. GO, of legal age, married, with post office address at xxx, because her name did not appear in the Lease Agreement that her husband signed in behalf of Kargo
herein referred to as the LESSOR-SELLER; representing KARGO ENTERPRISES Enterprises. Whether Glenn Go can legally sign the Lease Agreement in his capacity as a manager of
as its Manager, Kargo Enterprises, a sole proprietorship, is a question we do not decide, as this is a matter for the trial
court to consider in a trial on the merits.
xxx
Glenn Gos Role in the Case
thus, expressly pointing to KARGO ENTERPRISES as the principal that Glenn O. Go represented. In
other words, by the express terms of this Lease Agreement, Glenn Go did sign the agreement only as We find it significant that the business name Kargo Enterprises is in the name of Karen T.
the manager of Kargo Enterprises and the latter is clearly the real party to the lease agreements. Go,[19] who described herself in the Complaints to be a Filipino, of legal age, married to GLENN O. GO,
a resident of Cagayan de Oro City, and doing business under the trade name KARGO
As Navarro correctly points out, Kargo Enterprises is a sole proprietorship, which is neither ENTERPRISES.[20] That Glenn Go and Karen Go are married to each other is a fact never brought in
a natural person, nor a juridical person, as defined by Article 44 of the Civil Code: issue in the case. Thus, the business name KARGO ENTERPRISES is registered in the name of a
married woman, a fact material to the side issue of whether Kargo Enterprises and its properties are
Art. 44. The following are juridical persons: paraphernal or conjugal properties. To restate the parties positions, Navarro alleges that Kargo
Enterprises is Karen Gos paraphernal property, emphasizing the fact that the business is registered
(1) The State and its political subdivisions; solely in Karen Gos name.On the other hand, Karen Go contends that while the business is registered
(2) Other corporations, institutions and entities for public interest or purpose, in her name, it is in fact part of their conjugal property.
created by law; their personality begins as soon as they have been constituted
according to law; The registration of the trade name in the name of one person a woman does not necessarily
(3) Corporations, partnerships and associations for private interest or purpose to lead to the conclusion that the trade name as a property is hers alone, particularly when the woman is
which the law grants a juridical personality, separate and distinct from that of married. By law, all property acquired during the marriage, whether the acquisition appears to have
each shareholder, partner or member. been made, contracted or registered in the name of one or both spouses, is presumed to be
conjugal unless the contrary is proved.[21] Our examination of the records of the case does not show
any proof that Kargo Enterprises and the properties or contracts in its name are conjugal. If at all, only
Thus, pursuant to Section 1, Rule 3 of the Rules, [16] Kargo Enterprises cannot be a party to the bare allegation of Navarro to this effect exists in the records of the case. As we emphasized
a civil action. This legal reality leads to the question: who then is the proper party to file an action based in Castro v. Miat:[22]
on a contract in the name of Kargo Enterprises?
Petitioners also overlook Article 160 of the New Civil Code. It provides
We faced a similar question in Juasing Hardware v. Mendoza,[17] where we said: that all property of the marriage is presumed to be conjugal partnership, unless it
be prove[n] that it pertains exclusively to the husband or to the wife. This
Finally, there is no law authorizing sole proprietorships like petitioner to article does not require proof that the property was acquired with funds of
bring suit in court. The law merely recognizes the existence of a sole proprietorship the partnership. The presumption applies even when the manner in which the
as a form of business organization conducted for profit by a single individual, and property was acquired does not appear.[23] [Emphasis supplied.]
requires the proprietor or owner thereof to secure licenses and permits, register the
business name, and pay taxes to the national government. It does not vest juridical Thus, for purposes solely of this case and of resolving the issue of whether Kargo Enterprises as a sole
or legal personality upon the sole proprietorship nor empower it to file or defend an proprietorship is conjugal or paraphernal property, we hold that it is conjugal property.
action in court.
Article 124 of the Family Code, on the administration of the conjugal property, provides:
Thus, the complaint in the court below should have been filed in the
name of the owner of Juasing Hardware. The allegation in the body of the Art. 124. The administration and enjoyment of the conjugal
complaint would show that the suit is brought by such person as proprietor or partnership property shall belong to both spouses jointly. In case
owner of the business conducted under the name and style Juasing of disagreement, the husbands decision shall prevail, subject to recourse to the court
Hardware. The descriptive words doing business as Juasing Hardware may be by the wife for proper remedy, which must be availed of within five years from the
added to the title of the case, as is customarily done.[18] [Emphasis supplied.] date of the contract implementing such decision.

xxx
This conclusion should be read in relation with Section 2, Rule 3 of the Rules, which states:
This provision, by its terms, allows either Karen or Glenn Go to speak and act with authority
SEC. 2. Parties in interest. A real party in interest is the party who stands to in managing their conjugal property, i.e., Kargo Enterprises. No need exists, therefore, for one to obtain
be benefited or injured by the judgment in the suit, or the party entitled to the the consent of the other before performing an act of administration or any act that does not dispose of
avails of the suit. Unless otherwise authorized by law or these Rules, every action or encumber their conjugal property.
must be prosecuted or defended in the name of the real party in interest.
Under Article 108 of the Family Code, the conjugal partnership is governed by the rules on
As the registered owner of Kargo Enterprises, Karen Go is the party who will directly benefit the contract of partnership in all that is not in conflict with what is expressly determined in this Chapter
from or be injured by a judgment in this case. Thus, contrary to Navarros contention, Karen Go is the or by the spouses in their marriage settlements. In other words, the property relations of the husband

3
and wife shall be governed primarily by Chapter 4 on Conjugal Partnership of Gains of the Family Code themselves are part of conjugal funds, Article 1811 makes Quirino and Milagros de
and, suppletorily, by the spouses marriage settlement and by the rules on partnership under the Civil Guzman co-owners of the alleged credit.
Code. In the absence of any evidence of a marriage settlement between the spouses Go, we look at
the Civil Code provision on partnership for guidance. Being co-owners of the alleged credit, Quirino and Milagros de Guzman
may separately bring an action for the recovery thereof. In the fairly recent cases
A rule on partnership applicable to the spouses circumstances is Article 1811 of the Civil of Baloloy v. Hular and Adlawan v. Adlawan, we held that, in a co-ownership, co-
Code, which states: owners may bring actions for the recovery of co-owned property without the
necessity of joining all the other co-owners as co-plaintiffs because the suit
Art. 1811. A partner is a co-owner with the other partners of specific partnership is presumed to have been filed for the benefit of his co-owners. In the latter
property. case and in that of De Guia v. Court of Appeals, we also held that Article 487 of
the Civil Code, which provides that any of the co-owners may bring an action for
The incidents of this co-ownership are such that: ejectment, covers all kinds of action for the recovery of possession.

(1) A partner, subject to the provisions of this Title and to any agreement between In sum, in suits to recover properties, all co-owners are real parties in
the partners, has an equal right with his partners to possess specific interest. However, pursuant to Article 487 of the Civil Code and relevant
partnership propertyfor partnership purposes; xxx jurisprudence, any one of them may bring an action, any kind of action, for the
recovery of co-owned properties. Therefore, only one of the co-owners, namely
Under this provision, Glenn and Karen Go are effectively co-owners of Kargo Enterprises the co-owner who filed the suit for the recovery of the co-owned property, is
and the properties registered under this name; hence, both have an equal right to seek possession of an indispensable party thereto. The other co-owners are not indispensable
these properties. Applying Article 484 of the Civil Code, which states that in default of contracts, or parties. They are not even necessary parties, for a complete relief can be
special provisions, co-ownership shall be governed by the provisions of this Title, we find further support accorded in the suit even without their participation, since the suit is presumed to
in Article 487 of the Civil Code that allows any of the co-owners to bring an action in ejectment with have been filed for the benefit of all co-owners.[25] [Emphasis supplied.]
respect to the co-owned property.
Under this ruling, either of the spouses Go may bring an action against Navarro to recover
While ejectment is normally associated with actions involving real property, we find that this possession of the Kargo Enterprises-leased vehicles which they co-own. This conclusion is consistent
rule can be applied to the circumstances of the present case, following our ruling in Carandang v. Heirs with Article 124 of the Family Code, supporting as it does the position that either spouse may act on
of De Guzman.[24] In this case, one spouse filed an action for the recovery of credit, a personal property behalf of the conjugal partnership, so long as they do not dispose of or encumber the property in
considered conjugal property, without including the other spouse in the action. In resolving the issue of question without the other spouses consent.
whether the other spouse was required to be included as a co-plaintiff in the action for the recovery of
the credit, we said: On this basis, we hold that since Glenn Go is not strictly an indispensable party in the action
to recover possession of the leased vehicles, he only needs to be impleaded as a pro-forma party to
the suit, based on Section 4, Rule 4 of the Rules, which states:
Milagros de Guzman, being presumed to be a co-owner of the credits
allegedly extended to the spouses Carandang, seems to be either an indispensable Section 4. Spouses as parties. Husband and wife shall sue or be sued jointly,
or a necessary party.If she is an indispensable party, dismissal would be proper. If except as provided by law.
she is merely a necessary party, dismissal is not warranted, whether or not there
was an order for her inclusion in the complaint pursuant to Section 9, Rule 3.
Non-joinder of indispensable parties
Article 108 of the Family Code provides: not ground to dismiss action

Art. 108. The conjugal partnership shall be governed Even assuming that Glenn Go is an indispensable party to the action, we have held in a
by the rules on the contract of partnership in all that is not in number of cases[26] that the misjoinder or non-joinder of indispensable parties in a complaint is not a
conflict with what is expressly determined in this Chapter or by ground for dismissal of action. As we stated in Macababbad v. Masirag:[27]
the spouses in their marriage settlements.
Rule 3, Section 11 of the Rules of Court provides that neither misjoinder
This provision is practically the same as the Civil Code provision it superseded: nor nonjoinder of parties is a ground for the dismissal of an action, thus:

Art. 147. The conjugal partnership shall be governed Sec. 11. Misjoinder and non-joinder of parties. Neither
by the rules on the contract of partnership in all that is not in misjoinder nor non-joinder of parties is ground for dismissal of
conflict with what is expressly determined in this Chapter. an action. Parties may be dropped or added by order of the
court on motion of any party or on its own initiative at any
In this connection, Article 1811 of the Civil Code provides that [a] partner stage of the action and on such terms as are just. Any claim
is a co-owner with the other partners of specific partnership property. Taken with the against a misjoined party may be severed and proceeded with
presumption of the conjugal nature of the funds used to finance the four checks used separately.
to pay for petitioners stock subscriptions, and with the presumption that the credits

4
In Domingo v. Scheer, this Court held that the proper remedy when a
party is left out is to implead the indispensable party at any stage of the action. The WHEREFORE, premises considered, we DENY the petition for review for lack of
court, either motu proprio or upon the motion of a party, may order the inclusion of merit. Costs against petitioner Roger V. Navarro.
the indispensable party or give the plaintiff opportunity to amend his complaint in
order to include indispensable parties. If the plaintiff to whom the order to include SO ORDERED.
the indispensable party is directed refuses to comply with the order of the court,
the complaint may be dismissed upon motion of the defendant or upon the court's
own motion. Only upon unjustified failure or refusal to obey the order to include or
to amend is the action dismissed.

In these lights, the RTC Order of July 26, 2000 requiring plaintiff Karen Go to join her husband as a
party plaintiff is fully in order.

Demand not required prior


to filing of replevin action

In arguing that prior demand is required before an action for a writ of replevin is filed, Navarro
apparently likens a replevin action to an unlawful detainer.

For a writ of replevin to issue, all that the applicant must do is to file an affidavit and bond, pursuant to
Section 2, Rule 60 of the Rules, which states:

Sec. 2. Affidavit and bond.

The applicant must show by his own affidavit or that of some other person who
personally knows the facts:

(a) That the applicant is the owner of the property claimed, particularly
describing it, or is entitled to the possession thereof;

(b) That the property is wrongfully detained by the adverse party, alleging
the cause of detention thereof according to the best of his knowledge,
information, and belief;

(c) That the property has not been distrained or taken for a tax assessment or
a fine pursuant to law, or seized under a writ of execution or preliminary
attachment, or otherwise placed under custodia legis, or if so seized, that it
is exempt from such seizure or custody; and

(d) The actual market value of the property.

The applicant must also give a bond, executed to the adverse party in double the
value of the property as stated in the affidavit aforementioned, for the return of the
property to the adverse party if such return be adjudged, and for the payment to
the adverse party of such sum as he may recover from the applicant in the action.

We see nothing in these provisions which requires the applicant to make a prior demand on the
possessor of the property before he can file an action for a writ of replevin. Thus, prior demand is not a
condition precedent to an action for a writ of replevin.

More importantly, Navarro is no longer in the position to claim that a prior demand is necessary, as he
has already admitted in his Answers that he had received the letters that Karen Go sent him, demanding
that he either pay his unpaid obligations or return the leased motor vehicles. Navarros position that a
demand is necessary and has not been made is therefore totally unmeritorious.

5
After resting their case, respondents raised in their memorandum the argument that the case should have
been terminated at inception for petitioners failure to implead indispensable parties, the other co-owners
Jose, Victor and Victoria.

THIRD DIVISION In its April 19, 1993 Order,[8] the trial court, without ruling on the merits, dismissed the case without
prejudice, thus:
NIEVES PLASABAS and MARCOS MALAZARTE, G.R. No. 166519
Petitioners, This Court, much as it wants to decide the instant case on the merits, being one of
Present: the old inherited cases left behind, finds difficulty if not impossibility of doing so at
this stage of the proceedings when both parties have already rested their
YNARES-SANTIAGO, J., cases. Reluctantly, it agrees with the defendants in the observation that some
- versus - Chairperson, important indispensable consideration is conspicuously wanting or missing.
CARPIO MORALES,*
CHICO-NAZARIO, It is not the Courts wish to turn its back on the crucial part of the case, which is the
NACHURA, and pronouncement of the judgment to settle the issues raised in the pleadings of the
COURT OF APPEALS (Special Former Ninth Division), DOMINADOR PERALTA, JJ. parties once and for all, after all the time, effort and expense spent in going through
LUMEN, and AURORA AUNZO, the trial process.
Respondents. Promulgated:
But, rules are rules. They have to be followed, to arrive at a fair and just
March 31, 2009 verdict. Section 7, Rule 3 of the Rules of Court provides:

x------------------------------------------------------------------------------------x x x x Compulsory joinder of indispensable parties. Parties in


interest without whom no final determination can be had of an
action shall be joined either as plaintiffs or defendants.
DECISION
What the Court wants to say here is that the instant case should have been
NACHURA, J.: dismissed without prejudice a long time ago for lack of cause of action as the
plaintiffs spouses Marcos Malazarte and Nieves Plasabas Malazarte have no
complete legal personality to sue by themselves alone without joining the brothers
and sisters of Nieves who are as INDISPENSABLE as the latter in the final
determination of the case. Not impleading them, any judgment would have no
Assailed in this petition for review on certiorari under Rule 45 of the Rules of Court are the May 12, 2004 effectiveness.
Decision[1] of the Court of Appeals (CA) in CA-G.R. CV No. 43085 and the December 1, 2004
Resolution[2] denying reconsideration of the challenged decision. They are that indispensable that a final decree would necessarily affect their rights,
so that the Court cannot proceed without their presence. There are abundant
The pertinent facts and proceedings follow. authorities in this regard. Thus

In 1974, petitioners[3] filed a complaint for recovery of title to property with damages before the Court of The general rule with reference to the making of parties in a civil
First Instance (now, Regional Trial Court [RTC]) of Maasin, Southern Leyte against respondents. The action requires the joinder of all indispensable parties under any
case was docketed as Civil Case No. R-1949. The property subject of the case was a parcel of coconut and all conditions, their presence being a sine qua non of the
land in Canturing, Maasin, Southern Leyte, declared under Tax Declaration No. 3587 in the name of exercise of judicial power. (Borlasa v. Polistico, 47 Phil. 345,
petitioner Nieves with an area of 2.6360 hectares.[4] In their complaint, petitioners prayed that judgment 348) For this reason, our Supreme Court has held that when it
be rendered confirming their rights and legal title to the subject property and ordering the defendants to appears of record that there are other persons interested in the
vacate the occupied portion and to pay damages.[5] subject matter of the litigation, who are not made parties to the
action, it is the duty of the court to suspend the trial until such
Respondents, for their part, denied petitioners allegation of ownership and possession of the premises, parties are made either plaintiffs or defendants. (Pobre, et al. v.
and interposed, as their main defense, that the subject land was inherited by all the parties from their Blanco, 17 Phil. 156). x x x Where the petition failed to join as
common ancestor, Francisco Plasabas.[6] party defendant the person interested in sustaining the
proceeding in the court, the same should be dismissed. x x x
Revealed in the course of the trial was that petitioner Nieves, contrary to her allegations in the complaint, When an indispensable party is not before the court, the action
was not the sole and absolute owner of the land. Based on the testimonies of petitioners witnesses, the should be dismissed. (People, et al. v. Rodriguez, et al., G.R.
property passed on from Francisco to his son, Leoncio; then to Jovita Talam, petitioner Nieves Nos. L-14059-62, September 30, 1959) (sic)
grandmother; then to Antonina Talam, her mother; and then to her and her siblingsJose, Victor and
Victoria.[7] Parties in interest without whom no final determination can be
had of an action shall be joined either as plaintiffs or
defendants. (Sec. 7, Rule 3, Rules of Court).The burden of

6
procuring the presence of all indispensable parties is on the the case on the latters behalf.[15] Impleading the other co-owners is, therefore, not mandatory, because,
plaintiff. (39 Amjur [sic] 885). The evident purpose of the rule is as mentioned earlier, the suit is deemed to be instituted for the benefit of all.
to prevent the multiplicity of suits by requiring the person
arresting a right against the defendant to include with him, either In any event, the trial and appellate courts committed reversible error when they summarily
as co-plaintiffs or as co-defendants, all persons standing in the dismissed the case, after both parties had rested their cases following a protracted trial commencing in
same position, so that the whole matter in dispute may be 1974, on the sole ground of failure to implead indispensable parties. The rule is settled that the non-
determined once and for all in one litigation. (Palarca v. Baginsi, joinder of indispensable parties is not a ground for the dismissal of an action. The remedy is to implead
38 Phil. 177, 178). the non-party claimed to be indispensable. Parties may be added by order of the court on motion of the
party or on its own initiative at any stage of the action and/or at such times as are just. If petitioner refuses
An indispensable party is a party who has such an interest in to implead an indispensable party despite the order of the court, the latter may dismiss the
the controversy or subject matter that a final adjudication cannot complaint/petition for the plaintiffs/petitioner's failure to comply therewith. [16]
be made, in his absence, without inquiring or affecting such
interest; a party who has not only an interest of such a nature WHEREFORE, premises considered, the instant petition is GRANTED, and the case
that a final decree cannot be made without affecting his interest is REMANDED to the trial court for appropriate proceedings. The trial court is further DIRECTED to
or leaving the controversy in such a condition that its final decide on the merits of the civil case WITH DISPATCH.
determination may be wholly inconsistent with equity and good
conscience. (67 C.J.S. 892). Indispensable parties are those SO ORDERED.
without whom no action can be finally determined. (Sanidad v.
Cabataje, 5 Phil. 204)

WHEREFORE, IN VIEW OF ALL THE FOREGOING


CONSIDERATIONS, both the complaint and the counterclaim in the instant case are
ordered DISMISSED without prejudice. No pronouncement as to costs.

SO ORDERED.[9]

Aggrieved, petitioners elevated the case to the CA. In the challenged May 12, 2004 Decision, [10] the
appellate court affirmed the ruling of the trial court. The CA, further, declared that the non-joinder of the
indispensable parties would violate the principle of due process, and that Article 487 of the Civil Code
could not be applied considering that the complaint was not for ejectment, but for recovery of title or a
reivindicatory action.[11]

With their motion for reconsideration denied in the further assailed December 1, 2004
Resolution,[12] petitioners filed the instant petition.

The Court grants the petition and remands the case to the trial court for disposition on the merits.

Article 487 of the Civil Code provides that any one of the co-owners may bring an action for ejectment.
The article covers all kinds of actions for the recovery of possession, including an accion publiciana and
a reivindicatory action. A co-owner may file suit without necessarily joining all the other co-owners as co-
plaintiffs because the suit is deemed to be instituted for the benefit of all. Any judgment of the court in
favor of the plaintiff will benefit the other co-owners, but if the judgment is adverse, the same cannot
prejudice the rights of the unimpleaded co-owners.[13]

With this disquisition, there is no need to determine whether petitioners complaint is one for ejectment or
for recovery of title. To repeat, Article 487 of the Civil Code applies to both actions.

Thus, petitioners, in their complaint, do not have to implead their co-owners as parties. The only exception
to this rule is when the action is for the benefit of the plaintiff alone who claims to be the sole owner and
is, thus, entitled to the possession thereof. In such a case, the action will not prosper unless the plaintiff
impleads the other co-owners who are indispensable parties.[14]

Here, the allegation of petitioners in their complaint that they are the sole owners of the property
in litigation is immaterial, considering that they acknowledged during the trial that the property is co-
owned by Nieves and her siblings, and that petitioners have been authorized by the co-owners to pursue

7
also occupied the same.[13]Petitioner, on the other hand, is a stranger who never had possession of Lot
7226.

Sometime in 1961, spouses Ramon and Oligia needed money to finance the renovation of
FIRST DIVISION their house. Since they were not qualified to obtain a loan, they transferred ownership of Lot 7226 in the
name of their son Dominador who was the only one in the family who had a college education. By virtue
of a January 31, 1962 simulated deed of sale,[14] a title was issued to Dominador which enabled him to
ARNELITO ADLAWAN, G.R. No. 161916 secure a loan with Lot 7226 as collateral. Notwithstanding the execution of the simulated deed,
Petitioner, Dominador, then single, never disputed his parents ownership of the lot. He and his wife, Graciana, did
Present: not disturb respondents possession of the property until they died on May 28, 1987 and May 6, 1997,
Panganiban, C.J. (Chairman), respectively.
- versus - Ynares-Santiago,
Austria-Martinez, Respondents also contended that Dominadors signature at the back of petitioners birth certificate was
Callejo, Sr., and forged, hence, the latter is not an heir of Dominador and has no right to claim ownership of Lot
Chico-Nazario, JJ. 7226.[15] They argued that even if petitioner is indeed Dominadors acknowledged illegitimate son, his right
EMETERIO M. ADLAWAN and to succeed is doubtful because Dominador was survived by his wife, Graciana. [16]
NARCISA M. ADLAWAN, Promulgated: On February 12, 2002, the MTC dismissed the complaint holding that the establishment of petitioners
Respondents. filiation and the settlement of the estate of Dominador are conditions precedent to the accrual of
January 20, 2006 petitioners action for ejectment. It added that since Dominador was survived by his wife, Graciana, who
died 10 years thereafter, her legal heirs are also entitled to their share in Lot 7226. The dispositive portion
x ---------------------------------------------------------------------------------------- x thereof, reads:

DECISION In View of the foregoing, for failure to prove by preponderance of evidence, the
plaintiffs cause of action, the above-entitled case is hereby Ordered DISMISSED.

YNARES-SANTIAGO, J.: SO ORDERED.[17]

On appeal by petitioner, the RTC reversed the decision of the MTC holding that the title of
Assailed in this petition for review is the September 23, 2003 Decision[1] of the Court of Appeals in CA- Dominador over Lot 7226 cannot be collaterally attacked. It thus ordered respondents to turn over
G.R. SP No. 74921 which set aside the September 13, 2002 Decision[2] of the Regional Trial Court (RTC) possession of the controverted lot to petitioner and to pay compensation for the use and occupation of
of Cebu City, Branch 7, in Civil Case No. CEB-27806, and reinstated the February 12, 2002 the premises. The decretal portion thereof, provides:
Judgment[3] of the Municipal Trial Court (MTC) of Minglanilla, Metro Cebu, in Civil Case No. 392,
dismissing petitioner Arnelito Adlawans unlawful detainer suit against respondents Emeterio and Narcisa Wherefore, the Judgment, dated February 12, 2002, of the Municipal Trial
Adlawan. Likewise questioned is the January 8, 2004 Resolution[4] of the Court of Appeals which denied Court of Minglanilla, Cebu, in Civil Case No. 392, is reversed. Defendants-appellees
petitioners motion for reconsideration. are directed to restore to plaintiff-appellant possession of Lot 7226 and the house
thereon, and to pay plaintiff-appellant, beginning in August 2000, compensation for
The instant ejectment suit stemmed from the parties dispute over Lot 7226 and the house built thereon, their use and occupation of the property in the amount of P500.00 a month.
covered by Transfer Certificate of Title No. 8842,[5] registered in the name of the late Dominador Adlawan
and located at Barrio Lipata, Municipality of Minglanilla, Cebu. In his complaint, petitioner claimed that So ordered.[18]
he is an acknowledged illegitimate child[6] of Dominador who died on May 28, 1987 without any other
issue. Claiming to be the sole heir of Dominador, he executed an affidavit adjudicating to himself Lot Meanwhile, the RTC granted petitioners motion for execution pending appeal [19] which was
7226 and the house built thereon.[7] Out of respect and generosity to respondents who are the siblings of opposed by the alleged nephew and nieces of Graciana in their motion for leave to intervene and to file
his father, he granted their plea to occupy the subject property provided they would vacate the same an answer in intervention.[20] They contended that as heirs of Graciana, they have a share in Lot 7226
should his need for the property arise. Sometime in January 1999, he verbally requested respondents to and that intervention is necessary to protect their right over the property. In addition, they declared that
vacate the house and lot, but they refused and filed instead an action for quieting of title [8] with the RTC. as co-owners of the property, they are allowing respondents to stay in Lot 7226 until a formal partition of
Finally, upon respondents refusal to heed the last demand letter to vacate dated August 2, 2000, the property is made.
petitioner filed the instant case on August 9, 2000.[9]
The RTC denied the motion for leave to intervene.[21] It, however, recalled the order granting
On the other hand, respondents Narcisa and Emeterio, 70 and 59 years of age, the execution pending appeal having lost jurisdiction over the case in view of the petition filed by
respectively,[10] denied that they begged petitioner to allow them to stay on the questioned property and respondents with the Court of Appeals.[22]
stressed that they have been occupying Lot 7226 and the house standing thereon since birth. They
alleged that Lot 7226 was originally registered in the name of their deceased father, Ramon On September 23, 2003, the Court of Appeals set aside the decision of the RTC and reinstated
Adlawan[11] and the ancestral house standing thereon was owned by Ramon and their mother, Oligia the judgment of the MTC. It ratiocinated that petitioner and the heirs of Graciana are co-owners of Lot
Maacap Adlawan. The spouses had nine[12] children including the late Dominador and herein surviving 7226. As such, petitioner cannot eject respondents from the property via an unlawful detainer suit filed in
respondents Emeterio and Narcisa. During the lifetime of their parents and deceased siblings, all of them his own name and as the sole owner of the property. Thus
lived on the said property. Dominador and his wife, Graciana Ramas Adlawan, who died without issue,

8
WHEEFORE, premises considered, the appealed Decision dated judgment of the court in favor of the co-owner will benefit the others but if such
September 13, 2002 of the Regional Trial Court of Cebu City, Branch 7, in Civil Case judgment is adverse, the same cannot prejudice the rights of the unimpleaded co-
No. CEB-27806 is REVERSED and SET ASIDE, and the Judgment dated February owners. If the action is for the benefit of the plaintiff alone who claims to be the sole
12, 2002 of the Municipal Trial Court of Minglanilla, Metro Cebu, in Civil Case No. owner and entitled to the possession thereof, the action will not prosper unless he
392 is REINSTATED. Costs against the respondent. impleads the other co-owners who are indispensable parties.

SO ORDERED.[23]
In this case, the respondent alone filed the complaint, claiming sole
Petitioners motion for reconsideration was denied. Hence, the instant petition. ownership over the subject property and praying that he be declared the sole owner
thereof. There is no proof that the other co-owners had waived their rights over the
The decisive issue to be resolved is whether or not petitioner can validly maintain the instant subject property or conveyed the same to the respondent or such co-owners were
case for ejectment. aware of the case in the trial court. The trial court rendered judgment declaring the
respondent as the sole owner of the property and entitled to its possession, to the
Petitioner averred that he is an acknowledged illegitimate son and the sole heir of Dominador. prejudice of the latters siblings. Patently then, the decision of the trial court is
He in fact executed an affidavit adjudicating to himself the controverted property. In ruling for the erroneous.
petitioner, the RTC held that the questioned January 31, 1962 deed of sale validly transferred title to
Dominador and that petitioner is his acknowledged illegitimate son who inherited ownership of the
questioned lot. The Court notes, however, that the RTC lost sight of the fact that the theory of succession Under Section 7, Rule 3 of the Rules of Court, the respondent was
invoked by petitioner would end up proving that he is not the sole owner of Lot 7226. This is so because mandated to implead his siblings, being co-owners of the property, as parties. The
Dominador was survived not only by petitioner but also by his legal wife, Graciana, who died 10 years respondent failed to comply with the rule. It must, likewise, be stressed that the
after the demise of Dominador on May 28, 1987.[24] By intestate succession, Graciana and petitioner Republic of the Philippines is also an indispensable party as defendant because the
became co-owners of Lot 7226.[25] The death of Graciana on May 6, 1997, did not make petitioner the respondent sought the nullification of OCT No. P-16540 which was issued based on
absolute owner of Lot 7226 because the share of Graciana passed to her relatives by consanguinity and Free Patent No. 384019. Unless the State is impleaded as party-defendant, any
not to petitioner with whom she had no blood relations. The Court of Appeals thus correctly held that decision of the Court would not be binding on it. It has been held that the absence
petitioner has no authority to institute the instant action as the sole owner of Lot 7226. of an indispensable party in a case renders ineffective all the proceedings
subsequent to the filing of the complaint including the judgment. The absence of the
Petitioner contends that even granting that he has co-owners over Lot 7226, he can on his own respondents siblings, as parties, rendered all proceedings subsequent to the filing
file the instant case pursuant to Article 487 of the Civil Code which provides: thereof, including the judgment of the court, ineffective for want of authority to act,
ART. 487. Any one of the co-owners may bring an action in ejectment. not only as to the absent parties but even as to those present.[30]

This article covers all kinds of actions for the recovery of possession. Article 487 includes In the instant case, it is not disputed that petitioner brought the suit for unlawful detainer in his
forcible entry and unlawful detainer (accion interdictal), recovery of possession (accion publiciana), and name alone and for his own benefit to the exclusion of the heirs of Graciana as he even executed an
recovery of ownership (accion de reivindicacion).[26] A co-owner may bring such an action without the affidavit of self- adjudication over the disputed property. It is clear therefore that petitioner cannot validly
necessity of joining all the other co-owners as co-plaintiffs because the suit is presumed to have been maintain the instant action considering that he does not recognize the co-ownership that necessarily
filed to benefit his co-owners. It should be stressed, however, that where the suit is for the benefit of the flows from his theory of succession to the property of his father, Dominador.
plaintiff alone who claims to be the sole owner and entitled to the possession of the litigated property, the In the same vein, there is no merit in petitioners claim that he has the legal personality to file
action should be dismissed.[27] the present unlawful detainer suit because the ejectment of respondents would benefit not only him but
The renowned civilist, Professor Arturo M. Tolentino, explained also his alleged co-owners. However, petitioner forgets that he filed the instant case to acquire
possession of the property and to recover damages. If granted, he alone will gain possession of the lot
A co-owner may bring such an action, without the necessity of joining all the other and benefit from the proceeds of the award of damages to the exclusion of the heirs of Graciana. Hence,
co-owners as co-plaintiffs, because the suit is deemed to be instituted for the benefit petitioner cannot successfully capitalize on the alleged benefit to his co-owners. Incidentally, it should be
of all. If the action is for the benefit of the plaintiff alone, such that he claims pointed out that in default of the said heirs of Graciana, whom petitioner labeled as fictitious heirs, the
possession for himself and not for the co-ownership, the action will not State will inherit her share[31] and will thus be petitioners co-owner entitled to possession and enjoyment
prosper. (Emphasis added)[28] of the property.
The present controversy should be differentiated from the cases where the Court upheld the
[29]
right of a co-owner to file a suit pursuant to Article 487 of the Civil Code. In Resuena v. Court of
In Baloloy v. Hular, respondent filed a complaint for quieting of title claiming exclusive Appeals,[32] and Sering v. Plazo,[33] the co-owners who filed the ejectment case did not represent
ownership of the property, but the evidence showed that respondent has co-owners over the property. In themselves as the exclusive owner of the property. In Celino v. Heirs of Alejo and Teresa Santiago,[34] the
dismissing the complaint for want of respondents authority to file the case, the Court held that complaint for quieting of title was brought in behalf of the co-owners precisely to recover lots owned in
Under Article 487 of the New Civil Code, any of the co-owners may bring common.[35] Similarly in Vencilao v. Camarenta,[36] the amended complaint specified that the plaintiff is
an action in ejectment. This article covers all kinds of actions for the recovery of one of the heirs who co-owns the controverted properties.
possession, including an accion publiciana and a reinvidicatory action. A co-owner In the foregoing cases, the plaintiff never disputed the existence of a co-ownership nor claimed
may bring such an action without the necessity of joining all the other co-owners as to be the sole or exclusive owner of the litigated lot. A favorable decision therein would of course inure
co-plaintiffs because the suit is deemed to be instituted for the benefit of all. Any to the benefit not only of the plaintiff but to his co-owners as well. The instant case, however, presents

9
an entirely different backdrop as petitioner vigorously asserted absolute and sole ownership of the
questioned lot. In his complaint, petitioner made the following allegations, to wit:
3. The plaintiff was the only son (illegitimate) and sole heir of the late
DOMINADOR ADLAWAN who died intestate on 28 May 1987 without any other
descendant nor ascendant x x x.
xxxx
5. Being the only child/descendant and, therefore, sole heir of the
deceased Dominador Adlawan, the plaintiff became the absolute owner, and
automatically took POSSESSION, of the aforementioned house and lot x x x.
(Emphasis added)[37]
Clearly, the said cases find no application here because petitioners action operates as a
complete repudiation of the existence of co-ownership and not in representation or recognition thereof.
Dismissal of the complaint is therefore proper. As noted by Former Supreme Court Associate Justice
Edgrado L. Paras [i]t is understood, of course, that the action [under Article 487 of the Civil Code] is being
instituted for all. Hence, if the co-owner expressly states that he is bringing the case only for himself, the
action should not be allowed to prosper.[38]
Indeed, respondents not less than four decade actual physical possession of the questioned
ancestral house and lot deserves to be respected especially so that petitioner failed to show that he has
the requisite personality and authority as co-owner to file the instant case. Justice dictates that
respondents who are now in the twilight years of their life be granted possession of their ancestral
property where their parents and siblings lived during their lifetime, and where they, will probably spend
the remaining days of their life.
WHEREFORE, the petition is DENIED. The September 23, 2003 Decision of the Court of
Appeals in CA-G.R. SP No. 74921 which reinstated the February 12, 2002 Judgment of the Municipal
Trial Court of Minglanilla, Metro Cebu, dismissing petitioners complaint in Civil Case No. 392, and its
January 8, 2004 Resolution, are AFFIRMED.
SO ORDERED.

10
of a Salin ng Pamumusisyong ng Palaisdaan executed by the heirs of Primitiva Lejano with the
knowledge and consent of Teofilo A. Abejo in favor of one Aniano Victa and defendant. The contract
FIRST DIVISION provided that the period of lease shall be until November 30, 1979. When the contract expired and
[G.R. No. 120864. October 8, 2003] defendant failed to surrender the fishpond, written demands the last of which was on November 27,
1983 were made for defendants to pay back rental and to vacate the premises in question (Exh. D &
MANUEL T. DE GUIA, petitioner, vs. COURT OF APPEALS (Former Sixth Division) and JOSE B. E). Defendant refused to deliver possession and also to pay the rentals due. In anticipation, however,
ABEJO, represented by his Attorney-in-Fact, Hermenegilda Abejo-Rivera, respondents. that defendant will vacate the fishpond, plaintiff, on December 21, 1983 entered into a two year
Kasunduan ng Buwisan ng Palaisdaan with Ruperto C. Villarico for a consideration of P50,000.00 (Exh.
DECISION G). This contract, despite its execution and even already notarized, had to be cancelled and the
CARPIO, J.: amount of P50,000.00 returnedby plaintiff to Villarico when the defendant did not heed the demand to
vacate the fishpond. For unpaid rental, actual as well as moral and exemplary damages, plaintiff asks
The Case payment of P450,000.00 and P20,000.00 attorneys fees.
This is a Petition for Review on Certiorari[1] assailing the 22 August 1994 Decision[2] as well as On the other hand, defendants evidence tends to show that the entire fishpond with an area of 79,200
the 27 June 1995 Resolution of the Court of Appeals in CA-G.R. CV No. 39875. The Court of Appeals sq. m. was leased to him by the heirs of Primitiva Lejano. Subsequently, defendant became the
affirmed the Decision[3] of the Regional Trial Court (trial court) of Malolos, Bulacan, Branch 16, in Civil absolute owner of one half of the undivided area of the fishpond and he questioned plaintiffs ownership
Case No. 8796-M. The trial courts Decision ordered petitioner Manuel T. De Guia (DE GUIA) to turn over of the other half as void and fraudulent. As to the area pertaining to plaintiff, defendant claimed that he
to private respondent Jose B. Abejo (ABEJO) possession of the one half () undivided portion of a fishpond introduced improvements worth P500,000 and being in good faith, he asked that he should be
and to pay actual damages and attorneys fees. reimbursed by plaintiff. In his pre-trial brief, however, defendant raised the only issue which is the
amount of damages plaintiff is entitled to in the form of rental. Hence, the thrust of the testimonies of
The Antecedents
defendants witnesses particularly Ben Ruben Camargo and Marta Fernando Pea was the amount of
On 12 May 1986, ABEJO[4] instituted an action for recovery of possession with damages against rental of fishponds in the same locality as the fishpond in question at a given time. However, the
DE GUIA. In his complaint, ABEJO alleged that he is the owner of the undivided portion of a property documentary evidence (Exhs. 1 and 2) in support of their testimony were not offered as evidence.[8]
used as a fishpond (FISHPOND) situated in Meycauayan, Bulacan and covered by TCT No. T-6358 of
The trial court rendered its decision on 8 June 1992, disposing as follows:
the Bulacan Register of Deeds. He alleged ownership over approximately 39,611 square meters out of
the FISHPONDs total area of 79,220 square meters. ABEJO further averred that DE GUIA continues to WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiff and against
possess and use the FISHPOND without any contract and without paying rent to ABEJOs damage and the defendant and hereby orders that:
prejudice. ABEJO also complained that DE GUIA refuses to surrender ownership and possession of the
FISHPOND despite repeated demands to do so after DE GUIAs sublease contract over the FISHPOND 1. Defendant shall turn over possession to plaintiff one half undivided portion of the
had expired. ABEJO asked the trial court to order DE GUIA to vacate an approximate area of 39,611 79,200 sq. m. fishpond who shall enjoy the benefits and fruits in equal
square meters as well as pay damages. share with the defendant effective immediately until such time that
partition of the property is effected;
DE GUIA, a lawyer by profession, appeared on his own behalf. He filed his Answer on 12 January
1990 after the Court of Appeals resolved several issues concerning the validity of the service of summons 2. Defendant shall pay to plaintiff the amount of P262,500.00 by way of actual or
on him. In his Answer, DE GUIA alleged that the complaint does not state a cause of action and has compensatory damages;
prescribed. He claimed that the FISHPOND was originally owned by Maxima Termulo who died intestate 3 Defendant shall pay plaintiff P20,000.00 as and for attorneys fees; and
with Primitiva Lejano as her only heir. According to him, ABEJO is not the owner of the entire FISHPOND
but the heirs of Primitiva Lejano who authorized him to possess the entire FISHPOND. He assailed 4. To pay the costs.
ABEJOs ownership of the undivided portion of the FISHPOND as void and claimed ownership over an
undivided half portion of the FISHPOND for himself. DE GUIA sought payment of damages and SO ORDERED.[9]
reimbursement for the improvements he introduced as a builder in good faith. Aggrieved, DE GUIA went to the Court of Appeals insisting the trial court erred in ordering him to
The trial court set the pre-trial and required the parties to file their pre-trial briefs. ABEJO filed his vacate and surrender possession of the undivided portion of the FISHPOND and to pay actual damages
pre-trial brief[5] on 05 April 1990. DE GUIA filed his pre-trial brief[6] on 31 July 1990. DE GUIAs pre-trial and attorneys fees. The Court of Appeals found DE GUIAs appeal without merit and affirmed the trial
brief raised as the only issue in the case the amount of damages in the form of rent that DE GUIA should courts decision. Upon DE GUIAs motion for reconsideration, the appellate court reduced the
pay ABEJO. DE GUIA also submitted an Offer to Compromise, [7] offering to settle ABEJOs claim compensatory damages from P262,500 to P212,500.
for P300,000 and to lease the entire FISHPOND to any party of ABEJOs choice. Hence, the instant petition.
Hearing commenced on 30 July 1990. ABEJO rested his case on 4 December 1990. DE GUIAs The undisputed facts as found by the trial court and adopted in toto by the Court of Appeals are
last witness completed her testimony on 22 November 1991. The trial court summarized the evidence restated as follows:
presented by ABEJO and DE GUIA as follows:
1. The subject of the dispute are two undivided parcels of land used as a fishpond situated
Evidence adduced from plaintiff shows that there are two parcels of land covering a fishpond with a in Barrio Ubihan, Meycauayan, Bulacan, originally co-owned by Primitiva Lejano and
total area of 79,220 sq. m. more or less, situated at Ubihan, Meycauayan, Bulacan andcovered by TCT Lorenza Araniego married to Juan Abejo.
No. 6358 equally owned by Primitiva Lejano and Lorenza Araniego married to Juan Abejo (Exh.
A). The one half undivided portion owned by Lorenza Araniego corresponding to 39,611 sq. m. was 2. The FISHPOND is registered under the names of Primitiva Lejano and Lorenza Araniego
later purchased by plaintiff from his father Teofilo Abejo (Exh. B), the only heir of the original owner under TCT No. 6358 of the Bulacan Register of Deeds as follows:
on November 22, 1983. Prior to this sale on July 30, 1974 the whole fishpond (79,220) was the subject

11
PRIMITIVA LEJANO, Filipina, of legal age, single - share; and LORENZA SO ORDERED.[12]
ARANIEGO, Filipina, of legal age, married to Juan Abejo, share, ---
The Court of Appeals affirmed the trial court in a Decision dated 30 August 2002 in CA-G.R. CV
3. The FISHPOND has a total land area of approximately 79,220 square meters. ABEJO is No. 38031. The Court of Appeals found the claim of force and intimidation in the execution of the
seeking to recover possession of the undivided portion of the FISHPOND containing documents as highly improbable since Primitiva Lejanos son, Renato Davis, witnessed the signing of the
39,611 square meters. documents and found nothing irregular at the time.The appellate court also held that assuming
Defendants threatened DE GUIA and the Lejano Heirs with immediate foreclosure, Defendants were
4. DE GUIA (along with a certain Aniano Victa) acquired possession of the entire FISHPOND merely exercising their legitimate right of foreclosing the mortgaged property for non-payment of the
by virtue of a document captioned Salin ng Pamumusisyong ng Palaisdaan (Lease loan. In addition, Primitiva Lejanos lawyer and notary public, Atty. Mamerto Abao, testified that the parties
Contract) executed between him and the heirs of Primitiva Lejano. The Lease Contract appeared before him to affirm the contents of the documents. He also stated that he was present when
was effective from 30 July 1974 up to 30 November 1979 for a consideration Defendants paid Primitiva Lejano Davis and her son Renato. As of this writing, DE GUIA has a pending
of P100,000. motion for reconsideration before the Court of Appeals. In the event the Court of Appeals Decision attains
5. The Lease Contract was executed with the knowledge and consent of Teofilo Abejo, sole finality, DE GUIA may lose whatever right he claims over the FISHPOND.
heir of Lorenza Araniego Abejo. Teofilo Abejo acquired Lorenza Araniego Abejos The Trial Courts Ruling
undivided share in the FISHPOND by intestate succession.
The trial court ruled that ABEJO has the right to demand that DE GUIA vacate and surrender an
6. Teofilo Abejo (now deceased) sold his undivided share in the FISHPOND to his area equivalent to ABEJOs undivided share in the FISHPOND. The trial court explained that DE GUIAs
son, ABEJO, on 22 November 1983. sublease contract expired in 1979 and ABEJO acquired his fathers share in 1983. However, the trial court
7. DE GUIA continues to possess the entire FISHPOND and to derive income from the pointed out that ABEJO failed to present evidence of the judicial or extra-judicial partition of the
property despite the expiration of the Lease Contract and several demands to vacate FISHPOND. The identification of the specific area pertaining to ABEJO and his co-owner is vital in an
made by Teofilo Abejo and by his successor-in-interest, ABEJO. The last demand letter action to recover possession of real property. Nevertheless, the trial court declared that pending partition,
was dated 27 November 1983. it is only just that DE GUIA pay ABEJO a reasonable amount as rental for the use of ABEJOs share in
the FISHPOND. DE GUIA admitted this obligation when he raised as sole issue in his pre-trial brief how
8. ABEJO filed his complaint for recovery of possession with damages against DE GUIA much rent he should pay ABEJO. DE GUIA even proposed P300,000 as the reasonable amount but
on 12 May 1986. under certain conditions which ABEJO found unacceptable.
9. DE GUIAs claim of ownership over the other undivided portion of the FISHPOND has not In determining the reasonable rent due to ABEJO, the trial court considered the Lease Contract
been finally adjudicated for or against him. between ABEJO and a certain Ruperto C. Villarico which provided for a yearly rent of P25,000 for
undivided portion of the FISHPOND. The trial court declared that the total amount of rent due
DE GUIA offers the verified Complaint for Annulment of Real Estate Mortgage and Contract of is P212,500, computed from November 1983 when ABEJO became a co-owner of the FISHPOND up to
Lease with Preliminary Injunction signed by the heirs of Primitiva Lejano as proof of his ownership of the 1991[13] or a period of eight and one half years. The trial court further ordered DE GUIA to pay an
other undivided half portion of the FISHPOND. Records show that DE GUIA filed the complaint for himself additional P50,000 which represents the amount ABEJO returned to Ruperto C. Villarico when they
and as attorney-in fact of the heirs of Primitiva Lejano (Lejano Heirs)[10] against Spouses Teofilo Morte cancelled the Lease Contract between them due to DE GUIAs refusal to vacate the FISHPOND.
and Angelina Villarico, Spouses Ruperto and Milagros Villarico, et al. (Defendants). The case was raffled
to Branch 12 of the Regional Trial Court of Malolos, Bulacan, and docketed as Civil Case. No. 86-27- Lastly, the trial court ruled that pending partition, ABEJO as co-owner has the right to possess the
M. The complaint alleged that DE GUIA acquired his undivided share in the FISHPOND from the Lejano FISHPOND and to receive an equal share in the benefits from the FISHPOND effective immediately. Until
Heirs in February 1986. DE GUIA and the Lejano Heirs sought to annul the Kasulatan there is a partition, and while there is no contract of lease, the Civil Code provisions on co-ownership
ng Sanglaan and Kasulatan ng Pagbubuwis ng Palaisdaan,executed on 10 November shall govern the rights of the parties.
1979 by Primitiva Lejano in favor of the Defendants. DE GUIA and the Lejano Heirs claimed that
Primitiva Lejano signed these documents under duress and without consideration. The Court of Appeals Ruling

The trial court rendered judgment [11]


on 28 February 1992 against DE GUIA and the Lejano Heirs The Court of Appeals affirmed the trial courts decision. The Court of Appeals debunked DE GUIAs
as follows: claim that partition and not recovery of possession was the proper remedy under the circumstances. The
Court of Appeals pointed out that DE GUIAs failure to respect ABEJOs right over his undivided share in
WHEREFORE, the evidence having shown the plaintiffs, particularly Manuel De Guia, their successor- the FISHPOND justifies the action for recovery of possession. The trial courts decision effectively
in-interest, not entitled upon the facts and the law to the relief prayed for in the amended complaint, the enforces ABEJOs right over the property which DE GUIA violated by possession and use without
same is hereby DISMISSED with costs against said plaintiff. Instead, as prayed for by defendants, payingcompensation. According to the Court of Appeals, partition would constitute a mechanical aspect
judgment is hereby rendered: of the decision just like accounting when necessary.
1. Declaring the Kasulatan ng Sanglaan (Exhs. A & 1) dated November 10, 1979, The Court of Appeals likewise rejected DE GUIAs claim that the award of compensatory damages
and the Kasulatan ng Pagbubuwis ng Palaisdaan (Exhs. C &3) also of P242,000, computed based on the rent stipulated in the Lease Contract between ABEJO and Ruperto
dated November 10, 1979, as valid for all legal intents and C. Villarico, is grossly exorbitant. The Court of Appeals clarified that the amount the trial court awarded
purposes; was P262,500 and not P242,000 as erroneously alleged by DE GUIA. The Court of Appeals pointed out
that the notarized Lease Contract between ABEJO and Ruperto C. Villarico carries more evidentiary
2. Ordering the Ex-Officio Sheriff, RTC, Bulacan, to proceed with the extrajudicial weight than the testimonies of DE GUIAs witnesses, Ben Ruben Camargo and Marta Fernando Pea. The
foreclosure of the subject real estate mortgage; and Court of Appeals also upheld the award of attorneys fees since the parties could have avoided litigation
3. Ordering plaintiffs to pay defendants attorneys fees in the amount of P20,000.00. had DE GUIA heeded the justifiable demands of ABEJO.

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On motion for reconsideration, the Court of Appeals reduced the compensatory damages whole, and over the whole he exercises the right of dominion, but he is at the same time the owner of a
from P262,500 to P212,500. The Court of Appeals explained that the trial court correctly computed the portion which is truly abstract.[15] On the other hand, there is no co-ownership when the different portions
total amount of rent due at P212,500. The trial court erred, however, in adding the sum of P50,000 owned by different people are already concretely determined and separately identifiable, even if not yet
representing the rent for 1983 and 1984 which ABEJO returned to Ruperto C. Villarico. The appellate technically described.[16]
court clarified that the sum of P212,500 was arrived at by multiplying the rent of P25,000 by 8 years. The
8 year period already included the two months rent received from and then subsequently reimbursed Article 487 of the Civil Code provides, [a]ny one of the co-owners may bring an action in ejectment.
to Ruperto C. Villarico. This article covers all kinds of actions for the recovery of possession.Article 487 includes forcible entry
and unlawful detainer (accion interdictal), recovery of possession (accion publiciana), and recovery of
The Issues ownership (accion de reivindicacion).The summary actions of forcible entry and unlawful detainer seek
the recovery of physical possession only. These actions are brought before municipal trial courts within
DE GUIA raises the following issues in his Memorandum: one year from dispossession. However, accion publiciana, which is a plenary action for recovery of the
I. right to possess, falls under the jurisdiction of the proper regional trial court when the dispossession has
lasted for more than one year. Accion de reivindicacion, which seeks the recovery of ownership, also
THE COURT OF APPEALS ERRED IN AFFIRMING THE TRIAL falls under the jurisdiction of the proper regional trial court.[17]
COURTS DECISION DENYING PETITIONERS PLEA FOR
DISMISSAL OF THE COMPLAINT FOR FAILURE TO STATE A Any co-owner may file an action under Article 487 not only against a third person, but also
CAUSE OF ACTION; against another co-owner who takes exclusive possession and asserts exclusive ownership of
the property.[18] In the latter case, however, the only purpose of the action is to obtain recognition of the
co-ownership. The plaintiff cannot seek exclusion of the defendant from the property because as co-
owner he has a right of possession. The plaintiff cannot recover any material or determinate part of the
II. property.[19]
THE COURT OF APPEALS ERRED IN AFFIRMING THE TRIAL In Hermogena G. Engreso with Spouse Jose Engreso v. Nestoria De La Cruz
COURTS ORDER DIRECTING PETITIONER TO TURN OVER THE and Herminio De La Cruz,[20] we reiterated the rule that a co-owner cannot recover a material or
ONE-HALF UNDIVIDED PORTION OF THE FISHPOND WHICH IS determinate part of a common property prior to partition as follows:
STILL UNDER A STATE OF CO-OWNERSHIP;
It is a basic principle in civil law that before a property owned in common is actually partitioned, all that
the co-owner has is an ideal or abstract quota or proportionate share in the entire property. A co-owner
III. has no right to demand a concrete, specific or determinate part of the thing owned in common because
until division is effected his right over the thing is represented only by an ideal portion.
THE COURT OF APPEALS ERRED IN AFFIRMING, IN PART, THE
AWARD OF ACTUAL OR COMPENSATORY DAMAGES DESPITE As such, the only effect of an action brought by a co-owner against a co-owner will be to obtain
LACK OF CREDIBLE EVIDENCE TO SUPPORT THE SAME; recognition of the co-ownership; the defendant cannot be excluded from a specific portion of the
property because as a co-owner he has a right to possess and the plaintiff cannot recover any material
or determinate part of the property. Thus, the courts a quo erred when they ordered the delivery of one-
half () of the building in favor of private respondent.
IV.
Indisputably, DE GUIA has been in exclusive possession of the entire FISHPOND since July
THE COURT OF APPEALS ERRED IN AFFIRMING THE AWARD OF 1974. Initially, DE GUIA disputed ABEJOs claim of ownership over the undivided portion of the
ATTORNEYS FEES IN PRIVATE RESPONDENTS FAVOR.[14]
FISHPOND. Subsequently, he implicitly recognized ABEJOs undivided share by offering to settle the
In essence, this Court is asked to resolve: (1) whether an action for recovery of possession and case for P300,000 and to vacate the property.During the trial proper, neither DE GUIA nor ABEJO
turn-over of the undivided portion of a common property is proper before partition; and (2) whether there asserted or manifested a claim of absolute and exclusive ownership over the entire FISHPOND. Before
is sufficient basis for the award of compensatory damages and attorneys fees. this Court, DE GUIA limits the issues to the propriety of bringing an action for recovery of possession and
the recovery of compensatory damages.
The Courts Ruling
Following the inherent and peculiar features of co-ownership, while ABEJO and DE GUIA have
The petition is partly meritorious. equal shares in the FISHPOND quantitatively speaking, they have the same right in a qualitative sense
as co-owners. Simply stated, ABEJO and DE GUIA are owners of the whole and over the whole, they
First and Second Issues: Cause of Action and Turn-Over of Possession
exercise the right of dominion. However, they are at the same time individual owners of a portion, which
DE GUIA contends that a co-owner cannot claim a definite portion from the property owned in is truly abstract because until there is partition, such portion remains indeterminate or unidentified.[21] As
common until there is a partition. DE GUIA argues that ABEJO should have filed an action for partition co-owners, ABEJO and DE GUIA may jointly exercise the right of dominion over the entire FISHPOND
instead of recovery of possession since the court cannot implement any decision in the latter case without until they partition the FISHPOND by identifying or segregating their respective portions.
first a partition. DE GUIA contends that an action for recovery of possession cannot prosper when the
Since a co-ownership subsists between ABEJO and DE GUIA, judicial or extra-judicial partition is
property subject of the action is part of an undivided, co-owned property. The procedural mode adopted
the proper recourse. An action to demand partition is imprescriptible and not subject to laches. [22] Each
by ABEJO, which is recovery of possession, makes enforcement difficult if not impossible since there is
co-owner may demand at any time the partition of the common property unless a co-owner has
still no partition of the subject property.
repudiated the co-ownership under certain conditions.[23] Neither ABEJO nor DE GUIA has repudiated
Under Article 484 of the Civil Code, there is co-ownership whenever the ownership of an undivided the co-ownership under the conditions set by law.
thing or right belongs to different persons. A co-owner of an undivided parcel of land is an owner of the

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To recapitulate, we rule that a co-owner may file an action for recovery of possession against a co-owner This issue involves calibration of the whole evidence considering mainly the credibility of
who takes exclusive possession of the entire co-owned property.However, the only effect of such action witnesses. As a rule, a party may raise only questions of law in an appeal by certiorari under Rule 45 of
is a recognition of the co-ownership. The courts cannot proceed with the actual partitioning of the co- the Rules of Court. The Supreme Court is not duty-bound to analyze and weigh again the evidence
owned property. Thus, judicial or extra-judicial partition is necessary to effect physical division of the considered in the proceedings below.[32] More so in the instant case, where the Court of Appeals affirmed
FISHPOND between ABEJO and DE GUIA. An action for partition is also the proper forum for accounting the factual findings of the trial court.[33]
the profits received by DE GUIA from the FISHPOND. However, as a necessary consequence of such
recognition, ABEJO shall exercise an equal right to possess, use and enjoy the entire FISHPOND. It is not true that the trial court disregarded the testimonies of Camargo and Pea because DE GUIA
failed to present documentary evidence to support their testimonies.Actually, the trial and appellate courts
DE GUIA further claims that the trial and appellate courts erred when they ordered the recovery of found the testimonies of Camargo and Pea unconvincing. Judges cannot be expected to rely on the
rent when the exact identity of the portion in question had not yet been clearly defined and testimonies of every witness. In ascertaining the facts, they determine who are credible and who are
delineated. According to DE GUIA, an order to pay damages in the form of rent is premature before not. In doing so, they consider all the evidence before them.[34]
partition.
We find no cogent reason to overturn the trial and appellate courts evaluation of the witnesses
We disagree. testimonies. We likewise find reasonable the P25,000 yearly compensation for ABEJOs undivided share
in the FISHPOND. Indeed, being a question of fact, it is for the trial and appellate courts to decide and
The right of enjoyment by each co-owner is limited by a similar right of the other co-owners. A co- this Court will not disturb their findings unless clearly baseless or irrational. The exception does not obtain
owner cannot devote common property to his exclusive use to the prejudice of the co- in this case.
ownership.[24] Hence, if the subject is a residential house, all the co-owners may live there with their
respective families to the extent possible. However, if one co-owner alone occupies the entire house Fourth Issue: Attorneys Fees
without opposition from the other co-owners, and there is no lease agreement, the other co-owners
cannot demand the payment of rent. Conversely, if there is an agreement to lease the house, the co- The trial court did not err in imposing attorneys fees of P20,000. Attorneys fees can be awarded in
owners can demand rent from the co-owner who dwells in the house. the cases enumerated in Article 2208 of the Civil Code specifically:

The co-owners can either exercise an equal right to live in the house, or agree to lease it. If they xxx
fail to exercise any of these options, they must bear the consequences. It would be unjust to require the (2) Where the defendants act or omission has compelled the plaintiff to litigate with third
co-owner to pay rent after the co-owners by their silence have allowed him to use the property.[25] persons or to incur expenses to protect his interest;
In case the co-owners agree to lease a building owned in common, a co-owner cannot retain it for xxx
his use without paying the proper rent.[26] Moreover, where part of the property is occupied exclusively by
some co-owners for the exploitation of an industry, the other co-owners become co-participants in the DE GUIA is a lawyer and he should have known that a co-owner could not take exclusive
accessions of the property and should share in its net profits.[27] possession of a common property. Although DE GUIA offered to settle the case out of court, such offer
was made under conditions not acceptable to ABEJO. Certainly, ABEJO was still put to unnecessary
The Lejano Heirs and Teofilo Abejo agreed to lease the entire FISHPOND to DE GUIA. After DE expense and trouble to protect his interest under paragraph (2), Article 2208 of the Civil Code.
GUIAs lease expired in 1979, he could no longer use the entire FISHPOND without paying rent. To allow
DE GUIA to continue using the entire FISHPOND without paying rent would prejudice ABEJOs right to WHEREFORE, the Decision dated 22 August 1994 and Resolution dated 27 June 1995 of the
receive rent, which would have accrued to his share in the FISHPOND had it been leased to Court of Appeals in CA-G.R. CV No. 39875 is AFFIRMED with respect to that portion ordering Manuel T.
others.[28] Since ABEJO acquired his undivided share in the FISHPOND on 22 November 1983, DE GUIA De Guia to pay Jose B. Abejo compensatory damages of P212,500 and attorneys fees of P20,000,
should pay ABEJO reasonable rent for his possession and use of ABEJOs portion beginning from that and MODIFIED as follows:
date. The compensatory damages of P25,000 per year awarded to ABEJO is the fair rental value or the
reasonable compensation for the use and occupation of the leased property, [29] considering the 1. The co-ownership between Manuel T. De Guia and Jose B. Abejo over the entire
circumstances at that time. DE GUIA shall continue to pay ABEJO a yearly rent of P25,000 corresponding FISHPOND covered by TCT No. 6358 of the Bulacan Register of Deeds is recognized
to ABEJOs undivided share in the FISHPOND. However, ABEJO has the option either to exercise an without prejudice to the outcome of CAG.R. CV No. 38031 pending before the Court of
equal right to occupy the FISHPOND, or to file a new petition before the trial court to fix a new rental rate Appeals and other cases involving the same property;
in view of changed circumstances in the last 20 years. 2. Manuel T. De Guia and Jose B. Abejo shall equally enjoy possession and use of the entire
ABEJO made an extrajudicial demand on DE GUIA by sending the 27 November 1983 demand FISHPOND prior to partition;
letter. Thus, the rent in arrears should earn interest at 6% per annum from 27 November 1983 until finality 3. The compensatory damages of P25,000 per annum representing rent from 27 November
of this decision pursuant to Article 2209[30] of the Civil Code. Thereafter, the interest rate is 12% per 1983 until May 1992 shall earn interest at 6% per annum from 27 November 1983 until
annum from finality of this decision until full payment.[31] finality of this decision, and thereafter at 12% per annum until full payment;
Third Issue: Lack of Credible Evidence to Support Award of Compensatory Damages 4. Manuel T. de Guia shall pay Jose B. Abejo a yearly rent of P25,000 from June 1992 until
DE GUIA contends the P212,500 in rent awarded to ABEJO is exorbitant. He assails as doubtful finality of this decision, with interest at 6% per annum during the same period, and
and self-serving evidence the Lease Contract between ABEJO and Ruperto C. Villarico that served as thereafter at 12% interest per annum until full payment;
basis for the yearly rent of P25,000 for ABEJOs share in the FISHPOND. 5. After finality of this decision and for as long as Manuel T. de Guia exclusively possesses
DE GUIA says the trial and appellate courts should have given credence to the testimonies of his the entire FISHPOND, he shall pay Jose B. Abejo a yearly rental of P25,000 for the
witnesses, Ben Ruben Camargo (Camargo) and Marta Fernando Pea (Pea) that rentals of fishponds in latters undivided share in the FISHPOND, unless Jose B. Abejo secures from the proper
the same vicinity are for much lesser considerations. court an order fixing a different rental rate in view of possible changed circumstances.
SO ORDERED.

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