G.R. No. L-27104 December 20, 1976
CELESTINA B. RAMOS and DE DIOS RAMOS, petitioners, vs. LAUREANO and ESPERANZA POTENCIANO, spouses; LAND TENURE ADMINISTRATION (now LAND AUTHORITY), represented by the Administrator, MANUEL CASTAÑEDA, JULIAN U. DE VERA, WALFRIDO DE LOS ANGELES, LEONARDO ESPAÑOLA and EMILIO REGALA, respondents.

FACTS

Petitioners Celestina B. Ramos and De Dios Ramos sought the nullification of an “Agreement to Sell” over a government lot executed between respondent spouses Laureano and Esperanza Potenciano and the Land Tenure Administration. Ramos claimed preferential right as a bona fide occupant, alleging the agreement was entered into without proper investigation and in violation of rules. The Land Tenure Administration, after investigation, upheld the Potencianos’ rights. Ramos appealed to the Office of the President, which also ruled against her. Meanwhile, the Potencianos and the Land Tenure Administration successfully sued for ejectment (Civil Case No. 32748) to recover possession of a portion of the lot occupied by Ramos. That ejectment judgment became final and executory.
Subsequently, petitioners filed the present Civil Case No. 43738, essentially re-litigating their claim of a preferential right to the lot and seeking to nullify the same “Agreement to Sell.” The respondents moved to dismiss the complaint. The Court of First Instance of Manila granted the motion and dismissed the case, prompting this appeal.

ISSUE

Whether the trial court correctly dismissed Civil Case No. 43738 on the ground of res judicata, barring the re-litigation of claims already settled in a prior final judgment.

RULING

Yes, the dismissal was correct. The Supreme Court affirmed the application of the doctrine of res judicata. All its essential requisites were present. First, the judgment in the prior ejectment case (Civil Case No. 32748) was final and executory, a finality underscored by the Supreme Court’s denial of a related petition for certiorari. Second, the court that rendered it had jurisdiction. Third, it was a judgment on the merits, as it resolved the issue of possession based on the parties’ rights.
Crucially, there was identity of parties, subject matter, and cause of action between the two cases. The parties were substantially the same. The subject matter was the same lot. The cause of action in both suits arose from the petitioners’ assertion of a preferential right to the property, which they invoked as a defense and counterclaim in the first ejectment case. That claim was necessarily adjudicated and rejected when the court ruled in favor of the Potencianos’ right to possess the land. Having lost on that central issue in a final judgment, petitioners were barred from re-filing a new action to nullify the very agreement that formed the basis of the Potencianos’ superior right. The Court found the petitioners’ persistence in filing repetitive suits to be an abuse of judicial process. The petition was denied, and petitioners and their counsel were ordered to pay treble costs solidarily.