Viernes v. Pines Commercial Corp.
REITERATIONFacts
The Antecedents: Respondent Pines Commercial Corporation (Pines) filed an Amended Complaint against spouses Pedro and Josephine B. Viernes (Vierneses) and others, alleging that the Vierneses used falsified documents to acquire four parcels of land registered under Pines's name. Pines claimed it never sold the properties and remained in possession. Procedural History: The trial court denied the Vierneses' motion to dismiss. However, the Court of Appeals (CA) annulled the trial court's orders and dismissed Pines's complaint, finding doubtful the authority of Atty. Marissa Madrid-Dacayanan to represent Pines due to an intra-corporate dispute. The Supreme Court upheld the CA's dismissal. Subsequently, the Vierneses sought a writ of execution and possession, arguing the dismissal sustained their ownership. The trial court initially granted this but later set aside its order and dissolved the writ, stating the CA decision merely dismissed the complaint and did not delve into ownership. The RTC also noted that Josephine Viernes stated in her judicial affidavit that they leased the properties to Pines's alleged predecessor-in-interest. The CA affirmed the trial court's dissolution of the writ. The Petition: The Vierneses assailed the CA's decision, arguing that the lower courts erred in considering Pines's pleadings after it was declared dissolved and non-existent, and that the dismissal of the complaint affirmed their ownership, entitling them to possession.
Issue(s)
Whether the Court of Appeals and the Regional Trial Court erred in considering the pleadings filed by Pines Commercial Corporation when it was allegedly declared dissolved and non-existent. Whether the dismissal of Pines Commercial Corporation's Amended Complaint had the effect of affirming the ownership of the spouses Pedro and Josephine B. Viernes over the subject properties, thereby entitling them to possession. Whether the dissolution of the Writ of Execution and Writ of Possession issued in favor of the Vierneses was proper.
Ruling
The Petition is denied. The Decision dated November 15, 2021, and the Resolution dated March 18, 2022, of the Court of Appeals in CA-G.R. CV No. 114188 are affirmed.
Ratio Decidendi
On the issue of considering Pines's pleadings: The Court clarified that the CA did not rule on Pines's existence in its 2016 decision. Instead, the CA focused on the source of the authority of the individuals claiming to be the legitimate Board of Directors of Pines, under whom Atty. Dacayanan's right to institute the complaint originated. The CA found this authority to be of doubtful origin, citing insufficient proof from General Information Sheets and the lack of elections for the Board of Directors from 1978 to 2005. Therefore, the argument that Pines was declared dissolved and non-existent and thus its pleadings should not have been considered was without basis in the context of the CA's ruling. On whether the dismissal of the complaint affirmed ownership and entitled the Vierneses to possession: The Court held that the dismissal of Pines's Amended Complaint was based on Atty. Dacayanan's lack of authority to sue, not on a determination of the merits of the ownership claims. The 2016 CA Decision and the Supreme Court's resolution merely dismissed the complaint for lack of capacity to sue, and thus, res judicata did not set in. There was no judicial determination of ownership for either Pines or the Vierneses. Consequently, the Vierneses could not be considered as adjudged owners of the subject property based solely on the dismissal of the complaint. On the propriety of dissolving the Writ of Execution and Writ of Possession: The general rule is that a writ of execution must strictly conform to the dispositive portion of the judgment. While a writ can extend to what is necessarily included in the judgment, this exception, particularly regarding ownership necessarily including possession, applies only when the prevailing party is adjudged the owner and the defeated party has no other basis for possession apart from the rejected claim of ownership. In this case, the 2016 CA Decision did not adjudicate ownership, and there was no determination of whether Pines had any other basis for possession, such as a right as a lessee through its predecessor-in-interest. Therefore, the writ of execution and possession went beyond the judgment of dismissal and was correctly dissolved by the RTC, a power within its supervisory control over execution processes. The RTC and CA correctly annulled the Writ of Execution as it went beyond the scope of the 2016 CA Decision.
Main Doctrine
A writ of execution granting possession of a property is valid only if it strictly conforms to the dispositive portion of the judgment, or if possession is necessarily included therein. A dismissal of a complaint for lack of capacity to sue does not adjudicate ownership, and thus, a writ of possession cannot be issued based solely on such dismissal.