FRANCISCO MALVAR AND NATIVIDAD LOPEZ, PLAINTIFFS AND APPELLANTS, VS. PABLO PALLINGAYAN AND CATALINO CHUA, DEFENDANTS AND APPELLEES.

Appeal taken by the spouses Francisco Malvar and Natividad Lopez
from the order of dismissal of the Court of First Instance of Zambales
dated January 26, 1965, on the ground of res judicata.

This is an action for annulment of a contract of lease executed on
October 3, 1962 between defendants Pablo Pallingayan and Catalino Chua
over the two-storey building located at No. 9 Magsaysay Drive,
Olongapo, Zambales. The plaintiff-spouses alleged in their complaint
that they were the absolute owners of said building by virtue of a deed
of sale executed in their favor on February 26, 1961 by the spouses
Pablo Pallingayan (a defendant in this case) and Felicidad Pallingayan,
and that defendant Pablo Pallingayan, without the knowledge and consent
of the plaintiffs, not being their agent or representative and without
authority from them, and falsely representing himself as the owner of
the aforementioned building, leased the same to his co-defendant
Catalino Chua. Both defendants set up the defense of res judicata,
alleging that the ownership of the building is question, which is the
main issue in the instant case, had been previously litigated between
the plaintiffs Malvars and the defendants Pallingayan in Civil Cases
Nos. 2399 and 2359.

Civil Case No. 2399 of the Court of First Instance of Zambales
(Civil Case No. 243 of the Justice of the Peace Court of Olongapo,
Zambales) was an action for ejectment filed by Agustin Pascacio against
Pablo Pallingayan for failure to pay the monthly rentals due under a
contract of lease and mortgage executed between Agustin Pascacio as
lessor and Pablo Pallingayan as lessee over the two-storey building at
No. 9 Magsaysay Drive, Olongapo, Zambales. Pablo Pallingayan set up the
defense that he was the owner of the building. The spouses Francisco
Malvar and Natividad Lopez (plaintiffs in the instant case) intervened,
alleging that they were the owners of the building by virtue of a deed
of sale executed by Pablo Pallingayan.

Civil Case No. 2359 of the same court was filed by spouses Pablo
Pallingayan and Felicidad Pallingayan against the spouses Agustin
Pascacio and Rosario Pascacio for the annulment of that same contract
of lease and mortgage between Agustin Pascacio as lessor and Pablo
Pallingayan as lessee involved in Civil Case No. 2399, the plaintiffs
claiming that they were the owners of the building subject thereof.
Francisco Malvar and Natividad Lopez also intervened in that case,
alleging that they were the owners by virtue of the deed of absolute
sale relied upon by them in Civil Case No. 2399.

After the issues in Civil Cases Nos. 2399 and 2359 were joined, they
were set for joint hearing. On October 4, 1962, the date thus set, the
lower court issued the following order:

“Acting on the joint motion dated October 4, 1962,
of the plaintiffs and the defendants in the above-entitled cases, let
the plaintiffs’ complaint as well as the defendants’ counterclaim, in
both cases, be dismissed, without pronouncement as to costs.

It
appearing that Atty. Luis Buenaventura counsel for the intervenors in
both cases, has been duly notified of today’s hearing in Civil Case No.
2359 and notwithstanding said notification, neither the intervenors
Francisco Malvar and Natividad Lopez, nor their counsel came to court
today, let the intervenors’ intervention in the above entitled cases be
likewise dismissed, without pronouncement as to costs.”

In order that a prior judgment or order rendered in a case may be
conclusive in a subsequent case, the following requisites must be
present: (a) It must be a final judgment or order; (b) the court
rendering the same must have jurisdiction of the subject matter and of
the parties; (c) it must be a judgment or order on the merits; and (d)
there must be between the two cases identity of parties, identity of
subject matter, and identity of cause of action. (San Diego v. Cardona,
70 Phil. 281, 283; Aguilar v. Gamboa, 54 O.G. p. 8224; Buenafe v.
Bayona, 53 O.G. p. 690).

Pablo Pallingayan claimed to be the owner of the two-storey building
in question in Civil Case No. 2399. On the other hand, the spouses
Francisco Malvar and Natividad Lopez, as intervenors in said case,
alleged that although defendant Pablo Pallingayan was indeed the
original owner of said building, it was transferred to them by virtue
of a deed of sale executed in their favor by Pablo Pallingayan on
February 26, 1961. Again, in Civil Case No. 2359, both appellee Pablo
Pallingayan and his spouse Felicidad Pallingayan, as plaintiffs, and
Francisco Malvar and Natividad Lopez, also as intervenors, claimed
ownership of the same building.

Section 3, Rule 17 of the New Rules of Court provides:

Failure to prosecute. —
If plaintiff fails to appear at the time of the trial, or to prosecute
his action for an unreasonable length of time, or to comply with these
rules or any order of the court, the action may be dismissed upon
motion of the defendant or upon the court’s own motion. This dismissal
shall have the effect of an adjudication upon the merits, unless
otherwise provided by the court.

Plaintiffs-appellants Malvars intervened in both previous cases in
the role of plaintiffs since their claim of ownership was against the
other parties. When their intervention was dismissed for failure to
prosecute their case on the date of the hearing, the dismissal had the
effect of an adjudication upon the merits.

The order of dismissal dated October 4, 1962 is now final, no appeal
having been taken therefrom, and it was issued by the court having
jurisdiction of the subject matter and of the parties.

All the elements of res judicata being present in the instant case,
we find no error in the order of dismissal appealed from. The same is
therefore affirmed, with costs.

Concepcion, C.J., Reyes, J.B.L., Barrera, Dizon, Bengzon, J.P., Zaldivar, Sanchez, and Ruiz Castro, JJ., concur.
Regala, J., no part.