Sabido v. Intermediate Appellate Court
REITERATIONFacts
1. The Antecedents: This case originated from an action for quieting of title concerning two parcels of land, Lots "B" and "D." The trial court initially declared petitioners Pelicula Sabido and Maximo Rances as owners of these lots. However, when petitioners sought to take possession of Lot "B," they discovered private respondent Dominador Sta. Ana occupying a portion, claiming ownership by purchase from a third party and asserting that others occupying parts of the area were his tenants. 2. Procedural History: Following the initial ownership declaration, an order of demolition was issued against Sta. Ana. This order was initially set aside by the Supreme Court for further evidence reception to determine Sta. Ana's privity with the losing parties and the extent of land overlap. Subsequent trial court orders, including one by Judge Sunga and later by Judge Palma, found Sta. Ana to be in privity with the original losing parties and that Lot "B" was not part of his purchased land. Sta. Ana appealed to the Intermediate Appellate Court (IAC) after the trial court granted execution and demolition. The IAC, however, nullified the execution and demolition orders, directing the trial court to assess the value of demolished properties and the disputed area for set-off purposes. 3. The Petition: The petitioners seek review on certiorari of the IAC's decision, arguing that the IAC committed grave abuse of discretion by granting Sta. Ana the alternative choice of paying for the disputed land. Petitioners contend that Sta. Ana, being in privity with the losing parties, could not be considered a builder in good faith and thus should not be entitled to such an option. They assert that the demolition of Sta. Ana's constructions on Lot "B" and the private road is the logical consequence of his privity with the adversaries in the original case, and that the Supreme Court's prior resolutions, particularly those denying Sta. Ana's motions, affirmed the finality of the order for him to vacate.
Issue(s)
Whether the Intermediate Appellate Court committed grave abuse of discretion in granting private respondent Dominador Sta. Ana the alternative choice of paying the value of the disputed area. Whether private respondent Dominador Sta. Ana, being in privity with the losing parties, can claim the rights of a builder in good faith.
Ruling
The petition is GRANTED. The decision of the Intermediate Appellate Court dated September 20, 1985, is ANNULLED and SET ASIDE. The writ of attachment issued by the trial court for the purpose of satisfying the award for damages and the bill of costs is permanently SET ASIDE.
Ratio Decidendi
On the issue of grave abuse of discretion and the alternative choice: The Supreme Court found that the Intermediate Appellate Court committed reversible error in holding that Sta. Ana was entitled to exercise the option to pay the value of the disputed area and to reimbursement for the demolished portion of his building. The Court clarified that when it ordered the remand of the case, it was precisely to determine Sta. Ana's privity with the spouses Dasal. The trial court's resolution of May 16, 1983, which recommended an alternative choice, was rectified by subsequent Supreme Court resolutions denying Sta. Ana's petitions and motions for reconsideration. These resolutions affirmed that the May 16, 1983 resolution was in accord with the order of December 12, 1974, which directed Sta. Ana to vacate the premises. Therefore, Sta. Ana's only option was to remove his constructions and vacate the premises. On Sta. Ana's status as a builder in good faith: The Supreme Court ruled that Sta. Ana, having been adjudged in privity with the spouses Dasals, could not avail himself of the rights granted to a builder in good faith. As a builder in bad faith, he was bound by Article 449 of the Civil Code, which states that he who builds, plants, or sows in bad faith on the land of another loses what is built, planted, or sown without right to indemnity. Consequently, Sta. Ana had to remove all his useful improvements over Lot "B" at his own expense and was not entitled to the right of retention or any reimbursement. The Court cited Metropolitan Waterworks and Sewerage System v. Court of Appeals and Santos v. Mojica to support the principle that a builder in bad faith loses improvements without indemnity.
Main Doctrine
A party found to be in privity with the losing party in a quieting of title case cannot claim the rights of a builder in good faith and is bound by the final decision, including the obligation to vacate and remove improvements without right to indemnity or retention.