G.R. No. 178495. July 26, 2010.

SPOUSES RODOLFO A. NOCEDA and ERNA T.

NOCEDA, petitioners, vs. AURORA ARBIZO-DIRECTO,
respondent.

Remedial Law; Judgments; Actions; Res Judicata; Two Main

Rules Laid Down by the Principle of Res Judicata.·The principle of
res judicata lays down two main rules, namely: (1) the judgment or
decree of a court of competent jurisdiction on the merits concludes
the litigation between the parties and their privies and constitutes
a bar to a new action or suit involving the same cause of action
either before the same or any other tribunal; and (2) any right, fact,
or matter in issue directly adjudicated or necessarily involved in the
determination of an action before a competent court in which a
judgment or decree is rendered on the merits is conclusively settled
by the judgment therein and cannot again be litigated between the
parties and their privies whether or not the claims or demands,
purposes, or subject matters of the two suits are the same. These
two main rules mark the distinction between the principles
governing the two typical cases in which a judgment may operate as
evidence. The first general rule above stated, and which
corresponds to the afore-quoted paragraph (b) of Section 47, Rule 39
of the Rules of Court, is referred to as „bar by former judgment‰;
while the second general rule, which is embodied in paragraph (c) of
the same section and rule, is known as „conclusiveness of
judgment.‰
Same; Same; Same; Same; Conclusiveness of Judgments;
Concept of Conclusiveness of Judgment Explained.·It has been
held that in order that a judgment in one action can be conclusive
as to a particular matter in another action between the same
parties or their privies, it is essential that the issue be identical. If a
particular point or question is in issue in the second action, and the
judgment will depend on the determination of that particular point
or question, a former judgment between the same parties or their
privies will be final and conclusive in the second if that same point
or question was in issue and adjudicated in the first suit (Nabus v.
Court of Appeals, 193 SCRA 732 [1991]). Identity of cause of action
is not required but merely identity of issue.
_______________

* SECOND DIVISION.

473

VOL. 625, JULY 26, 2010 473

Noceda vs. Arbizo-Directo

Same; Same; Same; Same; Same; Conclusiveness of judgment

bars the relitigation of particular facts or issues in another litigation
between the same parties on a different claim or cause of action.·
Under the principle of conclusiveness of judgment, such material
fact becomes binding and conclusive on the parties. When a right or
fact has been judicially tried and determined by a court of
competent jurisdiction, or when an opportunity for such trial has
been given, the judgment of the court, as long as it remains
unreversed, should be conclusive upon the parties and those in
privity with them. Thus, petitioners can no longer question
respondentÊs ownership over Lot No. 1121 in the instant suit for
quieting of title. Simply put, conclusiveness of judgment bars the
relitigation of particular facts or issues in another litigation
between the same parties on a different claim or cause of action.

PETITION for review on certiorari of a decision of the

Court of Appeals.
The facts are stated in the opinion of the Court.
Eufracio Segundo C. Pagunuran for petitioners.
Wilfredo Paul D. Pangan for respondent.

NACHURA, J.:
Assailed in the instant petition is the Decision1 of the
Court of Appeals (CA), dismissing the appeal on the ground
of res judicata.
On September 16, 1986, respondent Aurora Arbizo-
Directo filed a complaint against her nephew, herein
petitioner Rodolfo Noceda, for „Recovery of Possession and
Ownership and Rescission/Annulment of Donation‰ with
the Regional Trial Court (RTC) of Iba, Zambales, Branch
71, docketed as Civil Case No. RTC-354-I. Respondent
alleged that she and

_______________

1 Docketed as CA-G.R. CV No. 87026, penned by Associate Justice

Martin S. Villarama, Jr. (now a member of this Court), with Associate
Justices Hakim S. Abdulwahid and Arturo G. Tayag, concurring; Rollo,
pp. 29-44.

474

474 SUPREME COURT REPORTS ANNOTATED

Noceda vs. Arbizo-Directo

her co-heirs have extrajudicially settled the property they

inherited from their late father on August 19, 1981,
consisting of a parcel of land, described as Lot No. 1121,
situated in Bitoong, San Isidro, Cabangan, Zambales. She
donated a portion of her hereditary share to her nephew,
but the latter occupied a bigger area, claiming ownership
thereof since September 1985.
Judgment was rendered in favor of respondent on
November 6, 1991, where the RTC (a) declared the
Extrajudicial Settlement-Partition dated August 19, 1981
valid; (b) declared the Deed of Donation dated June 1, 1981
revoked; (c) ordered defendant to vacate and reconvey that
donated portion of Lot 2, Lot 1121 subject of the Deed of
Donation dated June 1, 1981 to the plaintiff or her heirs or
assigns; (d) ordered the defendant to remove the house
built inside the donated portion at the defendantÊs expense
or pay a monthly rental of P300.00 Philippine Currency;
and (e) ordered the defendant to pay attorneyÊs fees in the
amount of P5,000.00.2 The decision was appealed to the
CA, docketed as CA-G.R. CV No. 38126.
On January 5, 1995, spouses Rodolfo Dahipon and
Cecilia Obispo- Dahipon filed a complaint for recovery of
ownership and possession, and annulment of sale and
damages against spouses Antonio and Dominga Arbizo,
spouses Rodolfo and Erna Noceda, and Aurora Arbizo-
Directo with the RTC, Iba, Zambales, Branch 70. This was
docketed as Civil Case No. RTC-1106-I. In the complaint,
spouses Dahipon alleged that they were the registered
owners of a parcel of land, consisting of 127,298 square
meters, situated in Barangay San Isidro, Cabangan,
Zambales, designated as Lot 1121-A. The Original
Certificate of Title No. P-9036 over the land was issued in
the name of Cecilia Obispo-Dahipon, pursuant to Free
Patent No. 548781. Spouses Dahipon claimed that the
defendants therein purchased portions of the land from
them without paying the

_______________

2 Id., at p. 30.
 475

VOL. 625, JULY 26, 2010 475

Noceda vs. Arbizo-Directo

full amount. Except for Aurora, a compromise agreement

was entered into by the parties, as a result of which, a deed
of absolute sale was executed, and TCT No. T-50730 was
issued in the name of spouses Noceda for their portion of
the land. For her part, Aurora questioned DahiponÊs
alleged ownership over the same parcel of land by filing an
adverse claim.
In the meantime, a decision was rendered in CA-G.R.
CV No. 38126 on March 31, 1995 with the following fallo:

„WHEREFORE, judgment is hereby rendered, ORDERING

defendant Rodolfo Noceda to VACATE the portion known as Lot „C‰
of Lot 1121 per Exhibit „E‰, which was allotted to plaintiff Aurora
Arbizo-Directo. Except for this modification, the Decision dated
November 6, 1991 of the RTC, Iba, Zambales, Branch 71, in Civil
Case No. RTC-354-I, is hereby AFFIRMED in all other respects.
Costs against defendant Rodolfo Noceda.‰3

Undaunted, petitioners filed a petition for review with

this Court, which was docketed as G.R. No. 119730. The
Court found no reversible error, much less grave abuse of
discretion, with the factual findings of the two courts below,
and thus denied the petition on September 2, 1999.4 The
decision became final and executory, and a writ of
execution was duly issued by the RTC on March 6, 2001 in
Civil Case No. RTC-354-I.
On December 4, 2003, petitioners instituted an action
for quieting of title against respondent, docketed as Civil
Case No. 2108-I. In the complaint, petitioners admitted
that Civil Case No. RTC-354-I was decided in favor of
respondent and a writ of execution had been issued,
ordering them to vacate the property. However, petitioners
claimed that the land, which was the subject matter of
Civil Case No. RTC-354-I, was the same parcel of land
owned by spouses Dahipon from whom they purchased a
portion; and that a title (TCT No. T-37468)

_______________

3 Id., at p. 31.
4 Decision was penned by Justice Minerva Gonzaga-Reyes (ret.).

476
476 SUPREME COURT REPORTS ANNOTATED
Noceda vs. Arbizo-Directo

was, in fact, issued in their name. Petitioners prayed for

the issuance of a writ of preliminary injunction to enjoin
the implementation of the Writ of Execution dated March
6, 2001 in Civil Case No. RTC-354-I, and that „a
declaration be made that the property bought, occupied and
now titled in the name of [petitioners] was formerly part
and subdivision of Lot No. 1121 Pls-468-D, covered by OCT
No. P-9036 in the name of Cecilia Obispo-Dahipon.‰5
Respondent filed a Motion to Dismiss on the ground of
res judicata. Respondent averred that petitioners, aware of
their defeat in Civil Case No. RTC-354-I, surreptitiously
negotiated with Cecilia Obispo-Dahipon for the sale of the
land and filed the present suit in order to subvert the
execution thereof.
The trial court denied the motion, holding that there
was no identity of causes of action.
Trial thereafter ensued. On January 25, 2006, after
petitioners presented their evidence, respondent filed a
Demurrer to Evidence, stating that the claim of ownership
and possession of petitioners on the basis of the title
emanating from that of Cecilia Obispo-Dahipon was
already raised in the previous case (Civil Case No. RTC-
354-I).
On February 22, 2006, the trial court issued a resolution
granting the demurrer to evidence.
The CA affirmed. Hence, petitioners now come to this
Court, raising the following issues:

WHETHER OR NOT THE PRINCIPLE OF RES JUDICATA OR

DOCTRINE OF CONCLUSIVENESS OF JUDGMENT IS
APPLICABLE UNDER THE FACTS OBTAINING IN THE
PRESENT CASE[;]
WHETHER OR NOT THE RESPONDENT HAS A BETTER TITLE
THAN THE PETITIONERS[; and]

_______________

5 Rollo, p. 32

477

VOL. 625, JULY 26, 2010 477

Noceda vs. Arbizo-Directo

WHETHER OR NOT THE RULING ON PURCHASERS IN BAD

FAITH IS APPLICABLE IN THE PRESENT CASE[.]6

Petitioners assert that res judicata7 does not apply,

considering that the essential requisites as to the identity
of parties, subject matter, and causes of action are not
present.
The petition is bereft of merit.
The doctrine of res judicata is set forth in Section 47 of
Rule 39 of the Rules of Court, as follows:

„Sec. 47. Effect of judgments or final orders.·The effect of a

judgment or final order rendered by a court of the Philippines,
having jurisdiction to pronounce the judgment or final order, may
be as follows:
xxxx
(b)  In other cases, the judgment or final order is, with
respect to the matter directly adjudged or as to any other
matter that could have been raised in relation thereto,
conclusive between the parties and their successors in
interest by title subsequent to the commencement of the
action or special proceeding, litigating for the same thing and
under the same title and in the same capacity; and
(c)  In any other litigation between the same parties or their
successors in interest, that only is deemed to have been
adjudged in a former judgment or final order which appears
upon its face to have been so adjudged, or which actually and
necessarily included therein or necessary thereto.

_______________

6 Id., at p. 16.
7 The requisites essential for the application of the principle of res
judicata are as follows: (1) there must be a final judgment or order; (2)
said judgment or order must be on the merits; (3) the Court rendering
the same must have jurisdiction on the subject matter and the parties;
and (4) there must be between the two cases identity of parties, subject
matter and causes of action. (Cruz v. Court of Appeals, G.R. No. 164797,
Feb. 13, 2006, 482 SCRA 379.)

478

478 SUPREME COURT REPORTS ANNOTATED

Noceda vs. Arbizo-Directo

The principle of res judicata lays down two main rules,

namely: (1) the judgment or decree of a court of competent
jurisdiction on the merits concludes the litigation between
the parties and their privies and constitutes a bar to a new
action or suit involving the same cause of action either
before the same or any other tribunal; and (2) any right,
fact, or matter in issue directly adjudicated or necessarily
involved in the determination of an action before a
competent court in which a judgment or decree is rendered
on the merits is conclusively settled by the judgment
therein and cannot again be litigated between the parties
and their privies whether or not the claims or demands,
purposes, or subject matters of the two suits are the same.
These two main rules mark the distinction between the
principles governing the two typical cases in which a
judgment may operate as evidence.8 The first general rule
above stated, and which corresponds to the afore-quoted
paragraph (b) of Section 47, Rule 39 of the Rules of Court,
is referred to as „bar by former judgment‰; while the second
general rule, which is embodied in paragraph (c) of the
same section and rule, is known as „conclusiveness of
judgment.‰9
The Court in Calalang v. Register of Deeds of Quezon
City10 explained the second concept which we reiterate
herein, to wit:

„The second concept · conclusiveness of judgment · states that

a fact or question which was in issue in a former suit and was there
judicially passed upon and determined by a court of competent
jurisdiction, is conclusively settled by the judgment therein as far
as the parties to that action and persons in privity with them are
concerned and cannot be again litigated in any future action
between such parties or their privies, in the same court or any other
court of concurrent jurisdiction on either the same or different cause
of ac-

_______________

8 8 Vda. de Cruzo v. Carriaga, Jr., G.R. Nos. 75109-10, June 28, 1989, 174
SCRA 330, 338.
9 Alamayri v. Pabale, G.R. No. 151243, April 30, 2008, 553 SCRA 146.
10 G.R. Nos. 76265 and 83280, March 11, 1994, 231 SCRA 88.

479

VOL. 625, JULY 26, 2010 479

Noceda vs. Arbizo-Directo

tion, while the judgment remains unreversed by proper authority. It

has been held that in order that a judgment in one action can be
conclusive as to a particular matter in another action between the
same parties or their privies, it is essential that the issue be
identical. If a particular point or question is in issue in the second
action, and the judgment will depend on the determination of that
particular point or question, a former judgment between the same
parties or their privies will be final and conclusive in the second if
that same point or question was in issue and adjudicated in the first
suit (Nabus v. Court of Appeals, 193 SCRA 732 [1991]). Identity of
cause of action is not required but merely identity of issue.
Justice Feliciano, in Smith Bell & Company (Phils.), Inc. v. Court
of Appeals (197 SCRA 201, 210 [1991]), reiterated Lopez v. Reyes (76
SCRA 179 [1977]) in regard to the distinction between bar by
former judgment which bars the prosecution of a second action upon
the same claim, demand, or cause of action, and conclusiveness of
judgment which bars the relitigation of particular facts or issues in
another litigation between the same parties on a different claim or
cause of action.
The general rule precluding the relitigation of material
facts or questions which were in issue and adjudicated in
former action are commonly applied to all matters essentially
connected with the subject matter of the litigation. Thus, it
extends to questions necessarily implied in the final
judgment, although no specific finding may have been made
in reference thereto and although such matters were directly
referred to in the pleadings and were not actually or formally
presented. Under this rule, if the record of the former trial
shows that the judgment could not have been rendered
without deciding the particular matter, it will be considered
as having settled that matter as to all future actions between
the parties and if a judgment necessarily presupposes certain
premises, they are as conclusive as the judgment itself.‰11

The foregoing disquisition finds application in the case

at bar. Undeniably, the present case is closely related to the
previous case (Civil Case No. RTC-354-I), where petitioners

_______________

11 Id., at pp. 99-100.

480

480 SUPREME COURT REPORTS ANNOTATED

Noceda vs. Arbizo-Directo

raised the issue of ownership and possession of Lot No.

1121 and the annulment of the donation of said lot to them.
The RTC found for respondent, declaring the deed of
donation she executed in favor of petitioners revoked; and
ordered petitioners to vacate and reconvey the donated
portion to respondent. The decision of the RTC was
affirmed by the CA, and became final with the denial of the
petition for review by this Court in G.R. No. 119730. In
that case, the Court noted the established fact „that
petitioner Noceda occupied not only the portion donated to
him by respondent Aurora Arbizo-Directo, but he also
fenced the whole area of Lot C which belongs to private
respondent Directo, thus, petitionerÊs act of occupying the
portion pertaining to private respondent Directo without
the latterÊs knowledge and consent is an act of usurpation
which is an offense against the property of the donor and
considered as an act of ingratitude of a donee against the
donor.‰12 Clearly, therefore, petitioners have no right of
ownership or possession over the land in question.
Under the principle of conclusiveness of judgment, such
material fact becomes binding and conclusive on the
parties. When a right or fact has been judicially tried and
determined by a court of competent jurisdiction, or when
an opportunity for such trial has been given, the judgment
of the court, as long as it remains unreversed, should be
conclusive upon the parties and those in privity with
them.13 Thus, petitioners can no longer question
respondentÊs ownership over Lot No. 1121 in the instant
suit for quieting of title. Simply put, conclusiveness of
judgment bars the relitigation of particular facts or issues
in another litigation between the same parties on a
different claim or cause of action.14

_______________

12 Noceda v. Court of Appeals, G.R. No. 119730, Sept. 2, 1999, 313

SCRA 504, 518-519.
13 Cruz v. Court of Appeals, supra note 7.
14 Tan v. Court of Appeals, 415 Phil. 675; 363 SCRA 444 (2001).

481

VOL. 625, JULY 26, 2010 481

Noceda vs. Arbizo-Directo

Furthermore, we agree that petitioners instituted the

instant action with unclean hands. Aware of their defeat in
the previous case, they attempted to thwart execution and
assert their alleged ownership over the land through their
purported purchase of a lot from Cecilia Obispo-Dahipon.
This later transaction appears to be suspect. A perusal of
G.R. No. 119730 reveals that the Court was not unaware of
DahiponÊs alleged claim over the same parcel of land. It
noted that Dahipon did not even bother to appear in court
 to present her free patent upon respondentÊs request, or to
intervene in the case, if she really had any legitimate
interest over the land in question.15 In any event,
petitionersÊ assertion of alleged good title over the land
cannot stand considering that they purchased the piece of
land from Dahipon knowing fully well that the same was in
the adverse possession of another.
Thus, we find no reversible error in the appellate courtÊs
ruling that petitioners are in fact buyers in bad faith. We
quote:

„With appellantsÊ actual knowledge of facts that would impel a

reasonable man to inquire further on [a] possible defect in the title
of Obispo, considering that she was found not to have been in actual
occupation of the land in CA-G.R. CV No. 38126, they cannot simply
invoke protection of the law as purchasers in good faith and for
value. In a suit to quiet title, defendant may set up equitable as
well as legal defenses, including acquisition of title by adverse
possession and a prior adjudication on the question under the rule
on res judicata. AppellantsÊ status as holders in bad faith of a
certificate of title, taken together with the preclusive effect of the
right of possession and ownership over the disputed portion, which
was adjudged in favor of appellee in Civil Case No. RTC-354-I, thus
provide ample justification for the court a quo to grant the
demurrer to evidence and dismiss their suit for quieting of title filed
against the said appellee.‰16

_______________

15 Noceda v. Court of Appeals, supra note 12, at 519.

16 Supra note 1, at 43.

© Copyright 2019 Central Book Supply, Inc. All rights reserved.