SPOUSES ARACELI OLIVA-DE MESA AND ERNESTO S. DE MESA, PETITIONER, VS. SPOUSES CLAUDIO D. ACERO, JR. AND MA. RUFINA D. ACERO, SHERIFF FELIXBERTO L. SAMONTE AND REGISTRAR ALFREDO …

Oliva-De Mesa versus Acero

The Case

This is a petition for review on certiorari brought by the spouses Araceli Oliva-De Mesa and Ernesto De Mesa against the spouses Claudio and Ma. Rufina Acero, the sheriff who conducted the levy, and the registrar of deeds. The petitioners ask the Supreme Court to cancel the Torrens title issued to Claudio Acero after a public auction sale of what they claim is their family home. The case matters because it settles two questions every examinee must know: first, that a judgment in an ejectment case does not bar a later action on ownership; and second, that the exemption of a family home from execution is a personal privilege that must be set up and proved to the sheriff before the auction sale, and is lost by unreasonable delay.

Procedural History

The spouses Acero filed a complaint for ejectment before the Municipal Trial Court of Meycauayan, Bulacan, which ruled in their favor and ordered the petitioners to vacate the property. The petitioners appealed to the Regional Trial Court of Malolos, Bulacan, but the appeal was dismissed for their failure to submit a memorandum, and reconsideration was denied. The petitioners then went up to the Court of Appeals by petition for review, which was denied, and that denial became final.

Meanwhile, the petitioners filed a separate complaint before the Regional Trial Court of Malolos, Bulacan to nullify Claudio Acero's title and other documents, with damages. The trial court dismissed the complaint, and the Court of Appeals affirmed. Reconsideration was denied. The petitioners then filed this petition for review on certiorari before the Supreme Court.

Facts

The petitioners jointly purchased a parcel of land in Meycauayan, Bulacan on April 17, 1984, while they were still merely cohabiting, and the land was registered in Araceli's name. They built a house on it and occupied it as their family home after they married in January 1987.

In September 1988, Araceli obtained a loan of 100,000 pesos from Claudio Acero, secured by a mortgage over the property, and issued a check in payment. The check was dishonored because the account had been closed, and the petitioners ignored demands for payment. Claudio filed a complaint for violation of the Bouncing Checks Law, and the trial court acquitted the petitioners but ordered them to pay Claudio 100,000 pesos with legal interest. A writ of execution issued, the sheriff levied on the property, and it was sold at public auction in March 1994, with Claudio as the highest bidder. A final deed of sale was issued to him, and a new Torrens title was issued in his name in April 1995.

In February 1995, Claudio leased the property back to the petitioners and a certain Juanito Oliva, who defaulted in rent. This led to the ejectment complaint. It was only after the ejectment case was filed, roughly four years after the auction sale, that the petitioners claimed the property was a family home exempt from execution.

Issues

• Whether or not the petitioners are guilty of forum-shopping.
• Whether or not the lower courts erred in refusing to cancel Claudio Acero's Torrens title over the subject property.

Applicable Provisions

Article 153 of the Family Code provides:

The family home from the time of its constitution and so long as any of its beneficiaries actually resides therein continues to be exempt from execution, forced sale or attachment except as hereinafter provided and to the extent of the value allowed by law.

This is the exemption the petitioners invoke, and the Court holds it is a personal right that must be claimed in time.

Article 155 of the Family Code provides:

The family home shall be liable for the following: (1) Taxes and assessments on the property; (2) Debts secured by mortgages on the premises before or after the constitution of such homestead; (3) Debts due to laborers, mechanics, architects, builders, materialmen and others who have rendered service or furnished material for the construction of the building.

The trial court cited this provision in ruling that a mortgage debt may reach the family home.

Ruling

On the first issue, the Court held that the petitioners are not guilty of forum-shopping. Forum-shopping requires an identity of parties, of rights asserted and reliefs prayed for, and of such particulars that a judgment in one case would amount to res judicata in the other. The Court found no such identity, because the primordial issue in ejectment is who has a better right of possession, while ownership is the core issue in an action to cancel a Torrens title. Any ruling on ownership in ejectment is merely provisional. A judgment in an ejectment case therefore does not bar an action between the same parties respecting title to the land.

On the second issue, the Court first held that the property is indeed a family home. It became a family residence in January 1987, before the Family Code took effect, and was never judicially or extrajudicially constituted under the Civil Code. Still, when the Family Code took effect on August 3, 1988, the property became a family home by operation of law and was prospectively exempt from execution.

But the Court held that the exemption must be set up and proved to the sheriff before the sale at public auction. The petitioners allowed the levy, the auction, the final deed of sale, and the cancellation of Araceli's title to pass in silence, raising the claim only about four years after the sale. Their failure to assert the right within a reasonable time estops them from later claiming the exemption, and their omission gives rise to the presumption that they abandoned or waived it.

Doctrine

First, a judgment in an ejectment case is not res judicata in an action to annul a title, and the reverse is also true, because the determination of ownership in ejectment is merely provisional and solely for the purpose of deciding possession.

Second, family residences existing after August 3, 1988 are family homes by operation of law and are prospectively exempt from execution under Article 153 of the Family Code, without need of judicial or extrajudicial constitution.

Third, the right of exemption is a personal privilege of the judgment debtor. It must be claimed not by the sheriff but by the debtor himself, and it must be set up and proved to the sheriff before the sale of the property at public auction, or within a reasonable time thereafter. Failure to do so estops the debtor from later claiming the exemption.

Disposition

The petition was denied, and the Court of Appeals decision and resolution were affirmed, so the spouses Acero prevailed and Claudio Acero's title stands.

Remember This

The one line to memorize: the family home's exemption from execution is a personal privilege that must be set up and proved to the sheriff before the public auction, and it is waived by unreasonable delay. Examiners use this case to test the distinction between ejectment and an action to annul title, and the timing rule for claiming the family home exemption.