National Onion Growers Cooperative Marketing Association, Inc. v. Lo
REITERATIONFacts
The Antecedents: Petitioner National Onion Growers Cooperative Marketing Association, Incorporated (petitioner) conveyed two lots (Lot No. 7 and Lot No. 8) to Agricultural Credit Administration (ACA) via dacion en pago to settle a debt. ACA transferred its rights to Land Bank of the Philippines (LBP). LBP then leased the premises to petitioner for one-and-a-half years, from June 1, 1994, to December 31, 1995. On November 9, 1995, LBP sold the lots to respondent Antonio Lo (Lo) through public bidding. Petitioner objected, asserting its preferential right to acquire the lots as a cooperative under Presidential Decree No. 175. Petitioner filed a case to annul the sale on December 8, 1995. Lo reminded petitioner on December 23, 1995, to vacate the premises upon lease expiration. Petitioner refused. Procedural History: On February 23, 1996, Lo filed an ejectment case against petitioner before the Metropolitan Trial Court (MTC). Petitioner countered that the MTC lacked jurisdiction due to the pending annulment case, arguing that the ownership issue barred the ejectment case. The MTC ruled that ejectment actions are summary and deal with possession de facto, and it could provisionally decide ownership to determine possession. The MTC ruled in favor of Lo on September 3, 1996. Petitioner appealed to the Regional Trial Court (RTC), which affirmed the MTC decision on August 29, 1997. The RTC denied petitioner's motion for reconsideration on November 27, 1997. Petitioner filed a Petition for Review with the Court of Appeals (CA), which affirmed the lower courts' decision with a modification reducing the daily penalty for delay from P5,000.00 to P1,000.00. Both parties moved for reconsideration, which the CA denied on December 29, 1999. The Petition: Petitioner seeks a reversal of the CA's decision, arguing that the MTC lost jurisdiction over the ejectment case once the question of ownership was raised.
Issue(s)
Whether the Metropolitan Trial Court loses jurisdiction over an ejectment case once the question of ownership is raised, considering the court's authority to provisionally determine ownership for the purpose of resolving possession. Whether the pendency of a case for annulment of sale in another court automatically deprives the MTC of jurisdiction over an ejectment case, especially when the defendant admits to being a lessee with an expired lease.
Ruling
The petition is denied. The Decision of the Court of Appeals dated 26 May 1999 and its Resolution dated 29 December 1999 in CA-G.R. SP No. 46334 are affirmed. Petitioner is ordered to vacate the subject premises immediately upon finality of this decision.
Ratio Decidendi
On the issue of MTC jurisdiction and the raising of ownership: The Court held that the allegations in the complaint determine the jurisdiction of a court. A party cannot divest the MTC of jurisdiction by merely raising the issue of ownership in its responsive pleading. The sole issue in ejectment cases is entitlement to physical possession, independent of ownership claims. If ownership is inextricably linked, the MTC may pass on the question of ownership only to determine possession, and this determination is provisional and does not affect the ownership itself, as provided in Section 16, Rule 70 of the Rules of Court. Ejectment cases are summary proceedings for expeditious protection of actual possession or right of possession. On the issue of the pendency of the annulment case: The Court reiterated that the MTC's jurisdiction is determined by the allegations in the complaint. The pendency of a separate case for annulment of sale does not automatically divest the MTC of jurisdiction over an ejectment case. The MTC correctly refused to dismiss the ejectment case, as ejectment proceedings are summary in nature and intended for the immediate resolution of possession issues. The arguments to the contrary were found to be without merit, and the cases cited were deemed no longer applicable. The Court noted that the party admitted to being a lessee, having relinquished ownership, and that its lease had expired, thus its continued occupation was unjustified. Prior possession is relevant in forcible entry but not in unlawful detainer, which involves the unjust refusal of a rightful possessor to vacate after possession ceases to be legal.
Main Doctrine
A court's jurisdiction is determined by the allegations in the complaint, and a party cannot divest the court of jurisdiction by merely raising the issue of ownership in its responsive pleading. In ejectment cases, the court may pass on the question of ownership solely to determine the issue of possession, and such determination is provisional.