Altizo v. Bryc-V Development Corporation
REITERATIONFacts
The Antecedents: Sea Foods Corporation Inc. (SFC) was the registered owner of Lot 300. Petitioners, including Gellia Altizo et al., occupied a portion of Lot 300 starting in the early 1960s. In 1989, petitioners organized into the United Muslim Christian Urban Poor Association, Inc. (UMCUPAI) to negotiate for the acquisition of Lot 300. On October 4, 1991, SFC and UMCUPAI entered into a "Letter of Intent to Sell by Landowner and Letter of Intent to Purchase by the UMCUPAI" (Letter of Intent), wherein SFC expressed its intention to sell Lot 300 at P105.00 per square meter, and UMCUPAI expressed its intention to buy the same. SFC later subdivided Lot 300 into three lots: Lot 300-A, Lot 300-B, and Lot 300-C. SFC sold Lot 300-A to UMCUPAI on January 11, 1995. On July 20, 1995, SFC sold Lot 300-C, where petitioners had constructed their houses, to BRYC-V Development Corporation (BRYC-V). Despite UMCUPAI's objection, BRYC-V was issued a title to Lot 300-C. BRYC-V demanded that petitioners vacate Lot 300-C, but they refused. Procedural History: BRYC-V filed an unlawful detainer case against petitioners before the Municipal Trial Court (MTC). The MTC ruled in favor of BRYC-V. On appeal, the Regional Trial Court (RTC) reversed the MTC decision, holding that the Letter of Intent granted UMCUPAI, and by extension its members (petitioners), a right of first refusal and that BRYC-V was bound to respect it. The Court of Appeals reversed the RTC decision, ruling that BRYC-V, as the registered owner, was entitled to possession and that the Letter of Intent did not transfer ownership or possession, being a mere manifestation of intent. The Petition: Petitioners sought review, arguing that under the Letter of Intent, they had the right to remain in Lot 300-C, as SFC was obliged to convey it to UMCUPAI, similar to how Lot 300-A was conveyed.
Issue(s)
Whether petitioners' occupation of Lot 300-C, based on a Letter of Intent to Sell between SFC and UMCUPAI, grants them a right to possess the property against the subsequent registered owner, BRYC-V. Whether the Letter of Intent, specifically, created a right of possession in favor of UMCUPAI and its members, sufficient to overcome the registered owner's right to possess.
Ruling
The petition is denied, and the decision of the Court of Appeals is affirmed. Petitioners are not entitled to possess Lot 300-C against the registered owner, BRYC-V.
Ratio Decidendi
On the right to possess based on the Letter of Intent against BRYC-V: The Court held that petitioners' occupation of Lot 300-C was initially on the mere tolerance of the previous owner, SFC. This right to occupy ceased when SFC sold the property to BRYC-V, who was subsequently issued a title and is therefore entitled to possession. In an unlawful detainer case, the only issue is the right to physical possession. Petitioners, by withholding possession despite BRYC-V's demand, have become deforciant occupants. On the Letter of Intent and right of possession: The Court clarified that the Letter of Intent, as its terms clearly indicate, merely signifies an intention to sell and does not create a right of possession. It does not, by itself, transfer ownership or the right to possess the property. The fact that SFC also sold Lot 300-A to UMCUPAI does not alter the nature of the Letter of Intent concerning Lot 300-C. Since the Letter of Intent did not grant a right of possession, petitioners' claim to continue occupying the lot is without legal basis against the registered owner.
Main Doctrine
A Letter of Intent to Sell, which merely signifies an intention to sell and not an actual transfer of ownership, does not create a right of possession that can defeat the claim of a subsequent registered owner.