City of Valenzuela v. Roman Catholic Archbishop of Manila
REITERATIONFacts
The Antecedents: Respondent, Roman Catholic Archbishop of Manila (RCAM), is the registered owner of a 2,000-sq.m. parcel of land covered by TCT No. T-25538 (T-71534), donated to it on March 30, 1955, for the purpose of a church and convent. Petitioner, City of Valenzuela, through its barangay captain, occupied and used 1,189 sq.m. of this property starting in 1992-1993, constructing a Barangay Hall, Police/Fire Station, and a sports complex without respondent's consent. Respondent discovered petitioner's intention to acquire the property in 1998 and noted petitioner's bad faith when it expanded the construction in May 1999. Procedural History: Respondent filed a Complaint for Recovery of Possession and Damages before the RTC. The RTC ruled in favor of respondent, declaring petitioner a builder in bad faith and ordering it to vacate, remove improvements, pay monthly rent, attorney's fees, and costs. The CA affirmed the RTC decision with modifications, ordering petitioner to vacate, remove improvements, pay monthly rent, and attorney's fees. The CA denied petitioner's motion for reconsideration. Petitioner then filed a Petition for Review on Certiorari before the Supreme Court. The Petition: Petitioner questions the CA's rulings on the authority of the Roman Catholic Bishop of Malolos, Inc. (RCBMI) to file the case, the sufficiency of proof for property identification, the non-applicability of laches, and the classification of petitioner as a builder in bad faith liable for damages.
Issue(s)
Whether the CA erred in ruling that the issue of authority of RCBMI to file the case was not raised at the earliest opportunity. Whether the CA erred in affirming that respondent is entitled to recovery of possession despite alleged insufficient proof to identify the property. Whether the CA erred in affirming that the case is not barred by laches. Whether the CA erred in ruling that petitioner is a builder in bad faith and should pay damages.
Ruling
The Supreme Court denied the Petition for Review on Certiorari, affirming the Decision of the Court of Appeals with modifications. The Court ordered the City of Valenzuela to vacate the subject property, deliver possession to the Roman Catholic Archbishop of Manila, remove all improvements at its expense, pay monthly rentals, nominal damages, and attorney's fees.
Ratio Decidendi
On the issue of the authority of RCBMI to file the case: The Court ruled that petitioner failed to raise the issue of the authority of RCBMI to file the case at the earliest opportunity. The arguments were not found in the Answer or Pre-Trial Brief, and were only raised in the Memorandum filed much later. The Court reiterated that defenses and objections not pleaded either in a motion to dismiss or in the answer are deemed waived, citing Section 1, Rule 9 of the Rules of Court. Despite this procedural lapse, the Court noted that it is undisputed that RCAM is the registered owner, and RCBMI, as its successor in interest, has legal standing to sue on behalf of RCAM. On the issue of property identification and recovery of possession: The Court held that respondent sufficiently proved both the identity of the property and its title thereto, satisfying the requirements of Article 434 of the New Civil Code. The TCT was presented as documentary evidence, and petitioner failed to present any evidence to prove its claim over the lot. Testimonial evidence from Fr. Samson and the fact that petitioner offered replacement properties during negotiations further corroborated respondent's ownership and the property's identity. The Court also cited Carvajal v. Court of Appeals for the principle that a certificate of title is conclusive evidence of the land's metes and bounds, and a survey plan is not always necessary. On the issue of laches: The Court found that laches had not set in. It reiterated the elements of laches and found that not all were present in this case. The RTC found that RCBMI discovered respondent's ownership only in 1997 and immediately asserted its right by meeting with petitioner and subsequently filing a complaint. This prompt action negates the allegation that respondent slept on its rights, as required for laches to apply. On the issue of petitioner being a builder in bad faith and liability for damages: The Court affirmed the CA's ruling that petitioner was a builder in bad faith. While acknowledging that petitioner might have been in good faith initially, it became aware of respondent's claim on May 21, 1998, upon receipt of the demand letter. Despite this knowledge, petitioner proceeded with the expansion of the sports complex. The Court emphasized that a builder in good faith is unaware of any flaw in their title, and continuing construction after notice of a superior claim constitutes bad faith. The Court applied Articles 449, 450, and 451 of the Civil Code, affirming the landowner's right to demand demolition and damages. The award of monthly rent and attorney's fees was upheld, and nominal damages of P100,000.00 were awarded to vindicate the violated property rights of the respondent.
Main Doctrine
A builder in bad faith who is aware of the landowner's claim and continues construction is liable for demolition of improvements and damages, including monthly rentals and nominal damages.