759 Phil.

531

SECOND DIVISION
[ G.R. No. 209535, June 15, 2015 ]
TERESITA S. LEE, PETITIONER, VS. LUI MAN CHONG,
RESPONDENT.

DECISION

MENDOZA, J.:

Before the Court is a petition for review on certiorari under Rule 45 of the Rules of Court
assailing the May 24, 2013 Decision[1] and the October 7, 2013 Resolution[2] of the Court of
Appeals (CA), in CA-G.R. CV No. 98141, which affirmed the August 8, 2011 Order[3] of the
Regional Trial Court of Baguio City, Branch 60, in Civil Case No. 6761-R (RTC Br. 60),
dismissing a case for recovery of properties.

The Facts:

On January 17, 2006, a certain Conrado P. Romero (Romero) died intestate. He left various
properties among which were four (4) parcels of land[4] in Baguio City and 4,600 shares of
Pines Commercial Corporation (PCC), a real estate development corporation (subject
properties).

On February 23, 2006, respondent Lui Man Chong (Chong), claiming to be Romero’s nephew,
executed an “Affidavit of Self-Adjudication,” adjudicating unto himself, as the sole and
exclusive heir of Romero, the latter’s whole estate. Consequently, the titles over the said
properties were transferred to his name.

On April 10, 2006, petitioner Teresita S. Lee (Lee), who claimed to be Romero’s common-law
wife, filed her “Petition for Letters of Administration of the Estate of Conrado K. Romero”
before the RTC and raffled to Branch 5 (RTC Br. 5), docketed as Special Proceedings  Case
(SPC) No. 1646-R (Special Proceedings Case). On August 24, 2006, the RTC Br. 5
dismissed SPC No. 1646-R, which was eventually affirmed by this Court.

On August 24, 2006, Lee, with a certain Linda Ng-Perido, filed a complaint for “Declaration of
Nullity of Affidavit of Self-Adjudication” against Chong before the RTC which was raffled to
Branch 61 (RTC Br. 61), docketed as Civil Case No. 6328-R (Annulment Case). Claiming to
own half of Romero’s estate during their cohabitation as common-law spouses, Lee sought the
nullification of Chong’s affidavit of self-adjudication and a declaration  that she is a co-owner of
Romero’s properties.

On April 29, 2008, the RTC Br. 61 dismissed the case for lack of  cause of action and legal
personality to file the said case. It explained that she, not having any matrimonial bond with
Romero, did not qualify as an heir of the latter under Article 887[5] and 1003[6] of the Civil
Code. It also stated that she failed to establish the fact that she indeed cohabited with Romero.
The dismissal of the annulment case was affirmed by this Court and attained finality on
January 12, 2009.

On September 4, 2008, Lee filed another case for “Annulment of Title with Damages” and
subsequently amended it to “Recovery of Ownership” against Chong before the RTC, which was
raffled to Branch 60 (RTC Br. 60), docketed as Civil Case No. 6761-R (Recovery Case). She
alleged, among others, that she was the common-law wife and business partner of Romero and
they ran various businesses together. She added that they were co-owners in equal portions pro
indiviso of the subject properties because they acquired them during their cohabitation using the
funds generated from their businesses. She further claimed that Chong illegally transferred the
subject properties of Romero and erroneously included her 1/2 share as co-owner of the same.
She prayed that the certificates of title in Chong’s name be cancelled and new ones be issued
naming her as owner of the 1/2 portion of each parcel of land and 50% of Romero’s 4,600 PCC
shares.

Chong moved for the dismissal of the Recovery Case for lack of jurisdiction and lack of cause
of action. Later, he added res judicata, as a ground invoking the final and executory judgment in
the Special Proceedings Case and the Annulment Case which she had earlier filed against him
involving the subject properties. He stressed that the causes of action in the Annulment Case
and the Recovery Case were both anchored on her claim that she was Romero’s common-law
spouse. He added that the final dismissal of the Annulment Case, which sought to declare the
nullity of his affidavit of self-adjudication, had effectively settled the issue of its validity
including the other consequences of its execution such as the ownership of the subject
properties.

On February 28, 2011, the RTC Br. 60 issued an Order,[7] denying the motion to dismiss filed
by Chong for lack of merit.

On August 8, 2011, acting on the motion for reconsideration filed by Chong, the RTC Br. 60
issued an Order,[8] granting his motion to dismiss on the ground of res judicata. In dismissing
the Recovery Case, the trial court explained that the issues between the parties in the said case
which were already settled in the Annulment Case need not be litigated anew. It stated that “[i]n
determining whether or not the Plaintiff is entitled to the recovery of her alleged portion of the
subject properties, the issue on the validity of the Affidavit of Self-Adjudication will inevitably
be tackled. A ruling on the issue of co-ownership would undermine the validity of the Affidavit
of Self-Adjudication and its consequences, such as the issuance of the Transfer Certificate of
Title in the name of the Defendant [Chong].” The issue on the validity of his Affidavit of Self-
Adjudication having been settled with finality, her prayer in the Recovery Case could not be
lawfully granted.

Lee moved for reconsideration, but her motion was denied by the RTC Br. 60.

On appeal, in its Decision, dated May 24, 2013, the CA affirmed the ruling of the RTC Br. 60.
The CA explained that the doctrine of res judicata, more specifically in the concept of bar by
prior judgment, had set in. It noted that the Annulment Case had already been dismissed with
finality by the RTC Br. 61, a court of competent jurisdiction. Both the Annulment Case and this
case involved the same parties and were anchored on Lee’s claim of co-ownership over the
subject properties which she claimed to have acquired through her joint effort with Romero
during their cohabitation. The CA stated that although the dismissal of the Annulment Case was
by virtue of an order pursuant to a motion to dismiss, it did not make the dismissal any less an
adjudication on the merits. The appellate court observed that the RTC Br. 61, in the Annulment
Case, unequivocally determined the rights and obligations of the parties. It expressly declared
that Lee had no legal personality and no cause of action to seek the nullification of the affidavit
of self-adjudication, as well as to recover the portion of the subject properties which she
claimed to be hers. The CA further stated that it would undertake the same evidence to support
and establish both the Annulment Case and the  this Recovery Case to obtain affirmative relief.
It added that the affirmative relief in the present case against Chong would be inconsistent with
the prior judgment. Lastly, it wrote that Lee sought practically the same relief in both cases
which was that she be ultimately declared as co-owner, but this was already settled with finality
in the Annulment Case.

Lee moved for reconsideration, but her plea was denied by the CA in its October 7, 2013
Resolution.

Hence, the present recourse.

Lee argues that the CA seriously erred in declaring that res judicata had set in so as to bar by a
prior judgment in the Annulment Case the present Recovery Case. She contends that assuming
for the sake of argument that res judicata had indeed set in its application would involve the
sacrifice of justice to technicality.

The issue to be resolved is whether the CA erred in affirming the ruling of the RTC Br. 60.

The Court’s Ruling

The Court finds no reversible error in the subject decision warranting the exercise of its
appellate jurisdiction.

Res judicata means "a matter adjudged; a thing judicially acted upon or decided; a thing or
matter settled by judgment."  It lays the rule that an existing final judgment or decree rendered
on the merits, without fraud or collusion, by a court of competent jurisdiction, upon any matter
within its jurisdiction, is conclusive of the rights of the parties or their privies, in all other
actions or suits in the same or any other judicial tribunal of concurrent jurisdiction on the points
and matters in issue in the first suit.[9]

The doctrine of res judicata embodied in Section 47, Rule 39 of the Rules of Court provides:

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 was actually and
necessarily included therein or necessary thereto.

The above-quoted provision embraces two concepts of res judicata: (1) bar by prior judgment;
and (2) conclusiveness of judgment.

Significantly, the elements of res judicata are: (1) the judgment sought to bar the new action
must be final; (2) the decision must have been rendered by a court having jurisdiction over the
subject matter and the parties; (3) the disposition of the case must be a judgment on the merits;
and (4) there must be as between the first and second action, identity of parties, subject matter,
and causes of action.  Should identity of parties, subject matter, and causes of action be shown
in the two cases, then res judicata in its aspect as a “bar by prior judgment” would apply.  If as
between the two cases, only identity of parties can be shown, but not identical causes of action,
then res judicata as “conclusiveness of judgment” applies.[10]

The Court finds that the subject case satisfies all the requisites of res judicata under the first
concept of bar by prior judgment.

It is on record that the prior Annulment Case had already been dismissed on April 29, 2008 and
the order of dismissal attained finality on January 12, 2009.

It is likewise unassailable that the RTC Br. 61 had jurisdiction over the parties in the prior
Annulment Case and rendered a judgment on the merits as it determined the rights and
obligations of the parties respecting the subject matter therein.

There can be no question as to the identity of the parties. The Annulment Case and the
Recovery Case were both instituted by Lee against Chong.

There is also identity of subject matter. The Annulment Case and the Recovery Case both
involved her claim over exactly the same properties already adjudicated in Chong’s name.

Finally, there is also identity of causes of action. Section 2, Rule 2 of the Rules of Court defines
a cause of action as “the act or omission by which a party violates a right of another.” The
causes of action in both the Annulment Case and the Recovery Case were the recovery of
ownership of 1/2 of the subject properties by Lee from Chong anchored on her claim that she
was a co-owner of the said properties. The crux of the two cases was her claimed deprivation of
her 1/2 share of the subject properties that Chong adjudicated unto himself.

The Court has previously employed various tests in determining whether or not there is identity
of causes of action as to warrant the application of the principle of res judicata. One test of
identity is the “absence of inconsistency test” where it is determined whether the judgment
sought will be inconsistent with the prior judgment. If no inconsistency is shown, the prior
judgment shall not constitute a bar to subsequent actions.[11]

The Court is of the view that, as aptly observed by the CA, the identity of the causes of action in
the Annulment Case and the Recovery Case becomes more palpable from the fact that in both
cases Lee practically seeks the same relief. Ultimately, she prays that the Court recognize and
declare her right as a co-owner of the same and divest Chong of his ownership over at least one
half of the subject properties.

In sum, absent any imprudent exercise of authority on the part of the CA, the Court finds no
compelling reason to deviate or depart from its ruling.

WHEREFORE, the petition is DENIED.

SO ORDERED.

Carpio, (Chairperson), Brion, Del Castillo, and Jardeleza,* JJ., concur.

*Designated Acting Member in lieu of Associate Justice Marvic M.V.F. Leonen, per Special
Order No. 2056, dated June 10, 2015.

[1] Rollo,pp. 32-53. Penned by Associate Justice Amy C. Lazaro-Javier with Associate Justices
Mariflor P. Punzalan Castillo and Zenaida T. Galapate-Laguilles, concurring.

[2]
Id. at 56. Penned by Associate Justice Amy C. Lazaro-Javier with Associate Justices
Mariflor P. Punzalan Castillo and Zenaida T. Galapate-Laguilles, concurring.

[3] Id. at 98 – 100.

[4] Covered by Transfer Certificate of Title Nos. T-70887, T-73161, T-73523, T-73836.

[5]Art. 887. The following are compulsory heirs:

(1) Legitimate children and descendants, with respect to their legitimate parents and ascendants;

(2) In default of the foregoing, legitimate parents and ascendants, with respect to their legitimate
children and descendants;

(3) The widow or widower;

(4) Acknowledged natural children, and natural children by legal fiction;

(5) Other illegitimate children referred to in article 287;

xxxx

[6]Art. 1003. If there are no descendants, ascendants, illegitimate children, or a surviving

[7] Rollo, pp. 91-97.

[8] Id. at 98-100.

[9] Selga v. Brar, G.R. No. 175151, September 21, 2011, 658 SCRA 108, 119.

[10]Social Security Commission v. Rizal Poultry and Livestock Association, Inc., G.R. No.
167050, June 1, 2011, 650 SCRA 50, 57-58.

[11] Spouses Torres v. Medina, 629 Phil. 101, 112 (2010).

Source: Supreme Court E-Library | Date created: October 25, 2017

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