LIGAYA ATON, JOYCE AGUILAR, RICARDO DEVERA, ALFREDO DEVERA, LAURENCIO BAYANA, PEDRO BAYANA, VENUS GALOPE, PENANCIA CHUA, RODRIGO AGUILAR, THELMA AGUILAR, HENRY AGUILAR, NOEL AGU…

Aton versus Guingona Homeowners' Association

The Case

This is a petition for review brought by Ligaya Aton and the other occupants of several subdivided lots in Butuan City against the Guingona Homeowners' Association, the registered owner of those lots. The association sued the occupants for unlawful detainer, damages, and attorney's fees, claiming that their stay on the property was tolerated out of sympathy and compassion. The occupants answered that they had possessed the lots openly and continuously in the concept of an owner for decades, and that the association's titles were void. The case matters because it draws the precise boundary of the ejectment remedy: a complaint may allege tolerance and thereby vest the municipal trial court with jurisdiction, but the plaintiff must still prove that tolerance from the very start of possession, or the action fails.

Procedural History

The association first brought complaints before the Office of the Punong Barangay. Conciliation was held in September 2002 but failed, and certificates to file action were issued. The association then filed its complaint for unlawful detainer before the Municipal Trial Court in Cities of Butuan City in January 2003. The municipal trial court rendered judgment in favor of the occupants, holding that the complaint failed to state a cause of action because it did not allege a demand to pay and to vacate.

On appeal, the Regional Trial Court reversed. It held that no demand to vacate was needed because there was no lessor-lessee relationship, the occupants being mere trespassers or squatters; and that in any event the certificates to file action substantially complied with the demand requirement. The Regional Trial Court remanded the case to the municipal trial court for further proceedings. On remand, the municipal trial court rendered judgment for the association, ordering the occupants to vacate, to pay one thousand pesos a month from October 2002 until vacated, to pay thirty thousand pesos in attorney's fees, and to pay the costs. The Regional Trial Court affirmed in full, and denied the occupants' motion for reconsideration. Hence this petition for review before the Supreme Court.

Facts

The Guingona Homeowners' Association became the registered owner of the subject parcels of land by virtue of transfer certificates of title issued pursuant to a notarized deed of absolute sale dated March 17, 1997, executed between the association's president and the Philippine National Bank. The occupants were already on the lots. The association claimed that its members, formerly landless, tolerated the occupants' stay out of sympathy and compassion even though the occupants were not members of the association.

The association invited the occupants to join so that they could avail themselves of the lease and purchase agreement granted to members. The occupants refused to join, refused to pay rent, refused to vacate, and denied the association's ownership. The association then filed complaints before the Office of the Punong Barangay to demand payment of rentals and vacation of the premises. Conciliation failed in September 2002, and certificates to file action were issued.

The occupants admitted they were not members of the association but denied that their stay was by mere tolerance. They maintained that they had possessed the lots publicly, exclusively, continuously, and in the concept of an owner for fifty-two years, and that they had filed petitions before several government agencies as claimants years before the association bought the property. They pointed to a petition filed in March 1993 against the register of deeds and the bank to annul the reconstitution proceedings from which the bank derived its title. The records showed that the occupants had alleged possession of the property in that 1993 petition, some four years before the 1997 sale to the association.

Issues

• Whether or not the complaint sufficiently alleged a cause of action for unlawful detainer so as to vest the municipal trial court with jurisdiction.
• Whether or not a prior demand to vacate was required before the complaint for conciliation before the Punong Barangay, and whether the barangay proceedings sufficed as the demand required by law.
• Whether or not the association's transfer certificates of title may be attacked as fake and spurious in the ejectment proceedings.
• Whether or not the association proved the tolerance of possession essential to sustain the ejectment.

Applicable Provisions

The decision applies the settled requisites of an action for unlawful detainer, which the Court states as follows:

An action is for unlawful detainer if the complaint sufficiently alleges the following: (1) initially, the defendant has possession of property by contract with or by tolerance of the plaintiff; (2) eventually, however, such possession became illegal upon plaintiff's notice to defendant, terminating the latter's right of possession; (3) still, the defendant remains in possession, depriving the plaintiff of the enjoyment of his property; and (4) within a year from plaintiff's last demand that defendant vacate the property, the plaintiff files a complaint for defendant's ejectment.

These requisites fix both the nature of the action and the jurisdiction of the court, and the complaint must specifically allege the facts constituting them.

On the tolerance that must exist from the outset, the Court adopts the rule in Carbonilla versus Abiera:

Tolerance must be [present] right from the start of possession sought to be recovered to be within the purview of unlawful detainer. Mere tolerance always carries with it 'permission' and not merely silence or inaction for silence or inaction is negligence, not tolerance.

This is the decisive element in the case, because the association failed to prove tolerance from the beginning of the occupants' possession.

On the sufficiency of allegations, the Court quotes Santos versus Ayon:

A complaint for unlawful detainer is sufficient if it alleges that the withholding of the possession or the refusal to vacate is unlawful without necessarily employing the terminology of the law.

This supports the ruling that the complaint, as pleaded, was sufficient to vest jurisdiction in the municipal trial court.

Ruling

On the first issue, the Court held that the allegations in the complaint determine both the nature of the action and the jurisdiction of the court, and that the complaint sufficiently alleged unlawful detainer. It alleged that the occupants possessed by mere tolerance, that the association demanded payment of rent and vacation before the Punong Barangay, and that the occupants refused, prompting the filing of the complaint in January 2003, within a year after the September 2002 conciliation. The municipal trial court therefore properly took cognizance of the case.

On the second issue, the Court agreed with the lower courts that the barangay proceedings sufficed as notice or demand. The law does not require any particular form of demand, and the conciliation proceedings showed that each party had aired its grievances and demands. The demand must precede the filing of the action for unlawful detainer in court, not necessarily the conciliation before the barangay. What is essential is that notice to vacate or to pay rent was made before the action was filed in the municipal trial court.

On the third issue, the Court held that a certificate of title cannot be subject to a collateral attack and can be altered, modified, or cancelled only in a direct proceeding in accordance with law. The validity of the association's title could not be passed upon in the ejectment case, and absent an order annulling the titles, their validity stands. The only matter for resolution in unlawful detainer is physical or material possession, independent of any claim of ownership.

On the fourth issue, the Court held that although the complaint adequately established a cause of action, the association failed to prove the tolerance essential to the action. Bare and unsubstantiated allegations do not constitute substantial evidence. Nothing in the records showed when and how the occupants came into possession, or that the association or its predecessors tolerated their stay from the very beginning. What was established was that the occupants had been in possession even before the association bought the lots in 1997, as shown by their 1993 petition. Since the claim of tolerance was not proven, the possession should be deemed illegal from the beginning, and unlawful detainer was the wrong remedy. The Court stressed that an action for ejectment cannot be treated as an accion publiciana or an accion reivindicatoria.

Doctrine

First, the allegations of the complaint determine the nature of the action and the jurisdiction of the court; a complaint for unlawful detainer must allege possession by contract or tolerance, the termination of that right upon demand, the defendant's continued possession, and the filing of the complaint within one year from the last demand.

Second, tolerance must be present right from the start of possession. A bare allegation of tolerance will not suffice; the plaintiff must show overt acts of permission, and silence or inaction is negligence, not tolerance. If possession was unlawful from the start, unlawful detainer is an improper remedy.

Third, no particular form of demand is required, and barangay conciliation proceedings may serve as the demand, provided the demand precedes the filing of the action in court.

Fourth, a certificate of title cannot be collaterally attacked in an ejectment case, and the only issue in unlawful detainer is physical or material possession, independent of any claim of ownership.

Disposition

The petition was granted; the decision of the Regional Trial Court was reversed and set aside, and the association's action for unlawful detainer against the occupants was dismissed.

Remember This

The one line to memorize: tolerance must be proved from the very start of possession, for silence or inaction is negligence, not tolerance. Examiners use this case to test the requisites of unlawful detainer, the sufficiency of barangay proceedings as demand, and the rule against collateral attack on a certificate of title in an ejectment suit.