TSHIATE L. UY AND RAMON UY, PETITIONERS, VS. THE COURT OF APPEALS, NATIVIDAD CALAUNAN-UY, AND THE ESTATE OF MENILO B. UY, SR., REPRESENTED BY MENILO C. UY, JR., NILDA C. UY, MEL…

This petition for review on certiorari assails
the decision, dated 23 September 1991, of respondent Court of Appeals, which
has reversed the questioned order of the Regional Trial Court, Branch 58,
Makati, Metro Manila.

The facts, hereunder recited, are culled from the findings of the
Court of Appeals.

Private respondent Natividad Calaunan-Uy was the common-law wife
of the late Menilo B. Uy, Sr., for about thirty-six (36) years. Their union bore four children – Melito, Jr., Nilda, Melvin and Merlito – all
surnamed Uy. On 31 October 1990, soon
after the death of Menilo Uy, Sr., herein petitioners Tshiate Uy and Ramon Uy
initiated before the Regional Trial Court (RTC), Branch 65, Makati, Metro
Manila, Special Proceedings No. M-2606, entitled “In the Matter of the
Petition for Letters of Administration of the Estate of Menilo B. Uy, Sr.”
On 28 February 1991, private respondent filed a motion to hold the special
proceedings in abeyance. The day
before, or on 27 February 1991, private respondent filed with the RTC, Branch
58, Makati, Civil Case No. 91-573 for “Partition of Properties Under
Co-ownership,” against the Estate of Menilo Uy, Sr. (supposedly
represented by their four children).

On the day of trial in Civil Case No. 91-573, or on 23 April
1991, the parties, upon the suggestion of the trial court, submitted a
Compromise Agreement. On 24 April 1991,
a judgment, based on that compromise, was rendered, and a writ of execution was
issued on 15 May 1991. On 24 May 1991,
petitioner Tshiate Uy filed an omnibus
motion, alleging that by virtue of a Hong Kong marriage, she was the
surviving legal spouse of Menilo, Sr. She prayed that she and her son Ramon Uy be allowed to intervene in the
civil case, submitting at the same time their answer in intervention. The intervenors contended, among other
things, that the judgment upon the compromise was a patent nullity. On 10 June 1991, the trial court issued an
order allowing the intervention and setting aside the “compromise judgment.”
Private respondent filed a motion for reconsideration; it was denied by the
trial court in its order of 08 July 1991. A petition for certiorari was filed with respondent
appellate court, which, on 23 September 1991, promulgated its decision, the dispositive
portion of which read:

“WHEREFORE, the petition is hereby granted and the orders of
respondent court dated June 10, 1991 and July 8, 1991 are hereby SET
ASIDE. No costs.

“SO ORDERED.”^[1]

A motion for reconsideration filed by
petitioners was denied by the appellate court in its resolution of 06 November
1991.

On 02 January 1992, the instant petition for review on certiorari
was filed with this Court, asserting that:

“The finding and the conclusion of the respondent Court of
Appeals that Judge Zosimo Angeles of the Regional Trial Court of Makati, Branch
58, erred in setting aside the Judgment by Compromise in Civil Case No. 91-573
because the same was already final and in fact partly executed is contrary to
law and jurisprudence to the effect that a Judgment void ab initio is non-existent and cannot acquire finality; and

“The finding and conclusion of the respondent Court of Appeals
to the effect that the intervention of petitioner in Civil Case No. 91-573 came
too late is contrary to the ruling of this Honorable Court in the case of
Director of Lands vs. Court of Appeals, et al., 93 SCRA 238.”^[2]

The appeal has merit.

The action for partition in Civil Case No. 91-573 is predicated
on an alleged co-ownership between private respondent Natividad Calaunan-Uy and
deceased Menilo, Sr., of property evidently acquired during the period of their
common-law relationship. The governing
provisions, applicable to their case, are now found in Article 147 and Article
148 of the Family Code, considering that Menilo Uy, Sr., died on 27 September
1990, well after the effectivity of Executive Order No. 209 (The Family Code of
the Philippines) on 03 August 1988. Hence –

“Art. 147. When a man
and a woman who are capacitated to marry each other, live exclusively with each
other as husband and wife without the benefit of marriage or under a void
marriage, their wages and salaries shall be owned by them in equal shares and
the property acquired by both of them through their work or industry shall be
governed by the rules on co-ownership.

“In the absence of proof to the contrary, properties acquired
while they lived together shall be presumed to have been obtained by their
joint efforts, work or industry, and shall be owned by them in equal
shares. For purposes of this Article, a
party who did not participate in the acquisition by the other party of any
property shall be deemed to have contributed jointly in the acquisition thereof if the former’s efforts
consisted in the care and maintenance of the family and of the household.

“Neither party can encumber or dispose by acts inter vivos of
his or her share in the property acquired during cohabitation and owned in
common, without the consent of the other, until after the termination of their
cohabitation.

“When only one of the parties to a void marriage is in good
faith, the share of the party in bad faith in the co-ownership shall be
forfeited in favor of their common children. In case of default of or waiver by any or all of the common children or
their descendants, each vacant share shall belong to the respective surviving
descendants. In the absence of
descendants, such share shall belong to the innocent party. In all cases, the forfeiture shall take
place upon termination of the cohabitation.”

“Art. 148. In cases of
cohabitation not falling under the preceding Article, only the properties
acquired by both of the parties through their actual joint contribution of
money, property, or industry shall be owned by them in common in proportion to
their respective contributions. In the
absence of proof to the contrary, their contributions and corresponding shares
are presumed to be equal. The same rule
and presumption shall apply to joint deposits of money and evidences of credit.

“If one of the parties is validly married to another, his or
her share in the co-ownership shall accrue to the absolute community or
conjugal partnership existing in such valid marriage. If the party who acted in bad faith is not validly married to
another, his or her share shall be forfeited in the manner provided in the last
paragraph of the preceding Article.

“The foregoing rules on forfeiture shall likewise apply even
if both parties are in bad faith.”

Parenthetically, closely intertwined with
the legal questions posed by the parties are factual issues which are yet to be
determined in Special Proceedings No. M-2606 filed by herein petitioners.

Respondent Court of Appeals set aside the orders of the trial
court on two points: That –

(1) The intervention came
too late, citing Section 2, Rule 12, of the Revised Rules of Court; and

(2) The court a quo ignored the rule on finality of judgments.

Section 2, Rule 12 of the Revised Rules of Court provides:

“Sec. 2. Intervention.
– A person may before or during a trial, be permitted by the court, in
its discretion, to intervene in an action, if he has legal interest in the
matter in litigation, or in the success of either of the parties, or an
interest against both, or when he is so situated as to be adversely affected by
a distribution or other disposition of property in the custody of the court or
of an officer thereof.”

The case Director of Lands vs. Court of
Appeals,^[3]
may not be on all fours to the case at bench but the rationale behind
the decision can well be applicable. Citing Manila Railroad Co. vs. Attorney-General,^[4] this
Court held:

“It is quite clear and patent that the
motions for intervention filed by the movants at this stage of the proceedings
where trial has already been concluded, a judgment thereon had been promulgated
in favor of private respondent and on appeal by the losing party, the Director
of Lands, the same was affirmed by the Court of Appeals and the instant
petition for certiorari to review said judgment is already submitted for
decision by the Supreme Court, are obviously and manifestly late, beyond the
period prescribed under the aforecoded Section 2, Rule 12 of the Rules of
Court.

“But Rule 12 of the
Rules of Court like all other Rules therein promulgated, is simply a rule of
procedure, the whole purpose and object of which is to make the powers
of the court fully and completely available for justice. The purpose of procedure is not to thwart
justice. Its proper aim is to
facilitate the application of justice to the rival claims of contending
parties. It was created not to hinder
and delay but to facilitate and promote the administration of justice. It does not constitute the thing itself
which courts are always striving to secure to litigants. It is designed as the means best adopted to
obtain that thing. In other words, it
is a means to an end.

“The denial of the motions for intervention arising from the
strict application of the Rule due to alleged lack of notice to, or the alleged
failure of, movants to act seasonably will lead the Court to commit an act of
injustice to the movants, to their successors-in-interest and to all purchasers
for value and in good faith and thereby open the door to fraud, falsehood and
misrepresentation, should intervenors’ claims be proven to be true. For it cannot be gainsaid that if the
petition for reconstitution is finally granted, the chaos and confusion arising
from a situation where the certificates of title of the movants covering large
areas of land overlap or encroach on properties the title to which is being
sought to be reconstituted by private respondent, who herself indicates in her
Opposition that, according to the Director of Lands, the overlapping embraces
some 87 hectares only, is certain and inevitable. The aggregate area of the property claimed by respondent covering
Lot 1 and Lot 2 is 1,435,062 sq. meters which is situated in a fast-growing,
highly residential sector of Metro Manila where growth and development are in
rapid progress to meet the demands of an urbanized, exploding population. Industries, factories, warehouses, plants,
and other commercial infrastructures are rising and spreading within the area
and the owners of these lands and the valuable improvements thereon will not
simply fold their hands but certainly will seek judicial protection of their
property rights or may even take the law into their own hands, resulting to
multiplicity of suits.”

Section 7, Rule 3, of the Revised Rules of Court defines
indispensable parties to be “(p)arties in interest without whom no final determination can be had of an action
x x x.” Even private
respondents, in their complaint in Civil Case No. 91-573, have acknowledged
that petitioners “claim some interest in the Estate of Menilo B. Uy,
Sr.”^[5]
The trial court itself, in setting aside its previous judgment upon compromise,
has expressed “that the intervenors have legal interest in the matter in
litigation,” a statement which we find hard to brush aside. In the interest of adjudicating the whole
controversy, petitioners’ inclusion in the action for partition, given the circumstances,
not only is preferable but rightly essential in the proper disposition of the
case. It is a settled rule that without
the presence of indispensable parties to a suit or proceeding, a judgment of
the court cannot attain real finality.^[6]

Private respondents argue that their failure to implead
petitioners in the complaint for partition has been cured by the filing of
petitioners’ omnibus motion asking leave to intervene and
attaching thereto an answer in intervention. Private respondents’ overlook the fact that the motion has been filed
subsequent to the judgment based upon the compromise agreement (among private
respondents themselves) that did not include, and thereby cannot be held to
bind, petitioners.^[7]

WHEREFORE, the decision of respondent Court of Appeals is
SET ASIDE and a new one is entered REINSTATING the order, dated 10 June 1991,
of the trial court.

SO ORDERED.

Feliciano, (Chairman), Bidin, Romero, and Melo, JJ., concur.

^[1]
Rollo, p. 35.

^[2]
Rollo, pp. 13-14.

^[3]
93 SCRA 238.

^[4]
20 Phil. 523.

^[5]
Rollo, p. 38.

^[6]
Lozano vs. Ballesteros, 195 SCRA 681.

^[7]
Filamer Christian Institute vs. Court of Appeals, 190 SCRA 485.