National Coconut Corporation v. Geronimo
REITERATIONFacts
1. The Antecedents: The underlying dispute concerns the possession of property. The respondent, Sagrada Orden de Predicadores, sold the property to a Japanese corporation. The Philippine Alien Property Custodian subsequently acquired possession of this property, and in August 1946, transferred possession to the petitioner, National Coconut Corporation. The respondent later sought to nullify this sale. 2. Procedural History: The respondent, Sagrada Orden de Predicadores, filed a complaint with the Municipal Court of Manila seeking possession of the property. The petitioner, National Coconut Corporation, had been in possession since August 1946, having received it from the Philippine Alien Property Custodian. A prior judgment in Civil Case No. 5007 had declared the sale of the property by the respondent to the Japanese corporation null and void. 3. The Petition: The petitioner, National Coconut Corporation, filed a petition for prohibition with preliminary injunction. They argued that their possession, and that of their predecessor, the Philippine Alien Property Custodian, was in good faith until a court judgment declared the sale void. They contended that the Municipal Court lacked jurisdiction because the one-year period for illegal detainer actions, as stipulated in the Rules of Court, had not elapsed from the time their possession became legally interrupted. The petition was denied.
Issue(s)
Whether the possession of the petitioner was in good faith. Whether the filing of the complaint and service of summons legally interrupted the petitioner's possession in good faith. Whether the Municipal Court has jurisdiction over the illegal detainer case.
Ruling
The petition for prohibition with preliminary injunction is denied. The Municipal Court has jurisdiction to try and decide the illegal detainer case.
Ratio Decidendi
On whether the possession of the petitioner was in good faith: The Court held that the possession of the property by the Philippine Alien Property Custodian and subsequently by the petitioner was in good faith, pursuant to Articles 434, 435, 436, and 1950 of the Civil Code. This good faith persisted until the Court of First Instance rendered judgment in Civil Case No. 5007, which declared the sale of the property by the respondent to a Japanese corporation null and void. Prior to this judgment, the possession was considered lawful. On whether the filing of the complaint and service of summons legally interrupted the petitioner's possession in good faith: The Court ruled that the possession in good faith was not interrupted upon the mere filing of the complaint against the Philippine Alien Property Custodian and the service of summons upon him. This is because the Custodian was not the purchaser of the property and, under the circumstances, was not aware of any defect in the sale from the respondent to the Japanese corporation. The possession only lost its character of good faith from the rendition of the judgment against the Custodian, making him or his successor liable for rents or fruits from that time until the property was delivered to the adjudged owner. On whether the Municipal Court has jurisdiction over the illegal detainer case: The Court affirmed the Municipal Court's jurisdiction. It reasoned that the possession of the petitioner became illegal only from the time it was notified or required by the respondent to return the possession and failed to do so. Before such notice or demand, the possession was legal or consented to, without prejudice to the obligation to pay for the use and occupation from the time possession ceased to be in good faith. Since less than one year had elapsed from the notice to vacate up to the filing of the illegal detainer complaint, the Municipal Court had jurisdiction under the Rules of Court.
Main Doctrine
Possession in good faith ceases to be such from the rendition of the judgment declaring the sale void, and liability for fruits or rents arises from that point until delivery of the property to the adjudged owner. For illegal detainer, the possession becomes illegal only upon notice or demand to vacate and failure to comply.