G.R. No. L-16051; April 25, 1961
Fernando Gochoco, et al., plaintiffs-appellants, vs. Chang Hiok @ Yu Tian Huat, et al., defendants-appellees.

FACTS

The plaintiffs-appellants, Fernando Gochoco and others, obtained a money judgment against defendant Chang Hiok in a prior Manila case (Civil Case No. 27996) for approximately P14,000. Alleging that only a portion of this judgment had been satisfied and that Chang Hiok had no other visible assets, they filed the present action in the Rizal court of first instance. Their complaint sought to annul two successive sales of real property: first, by Chang Hiok to defendant Leona Piano, and second, by Leona Piano to defendant Rosario Chang. The plaintiffs alleged these sales were simulated and executed in fraud of creditors to prevent collection of their judgment.
The defendants moved to dismiss the Rizal case, primarily on the ground of litis pendentia, or that another action was pending between the same parties for the same cause. In support, they presented the pleadings and decision from the prior Manila case (No. 27996). The trial court granted the motion and dismissed the complaint, prompting the plaintiffs’ appeal.

ISSUE

Whether the trial court correctly dismissed the complaint on the ground of litis pendentia.

RULING

Yes, the dismissal was proper. For litis pendentia to apply under the Rules of Court, there must be: (1) identity of parties, or at least such as represent the same interests; (2) identity of rights asserted and relief prayed for, founded on the same facts; and (3) such identity that a judgment in the other action would constitute res judicata in the case under consideration.
The Court found the required identities present. The parties in both suits are essentially the same. Crucially, the rights asserted and the factual bases for relief are identical. The plaintiffs argued that their cause of action in the present case was different, being ostensibly based on Chang Hiok’s “failure to fully satisfy” the Manila judgment, whereas in Manila, the cause was the simulation and fraud of the sales. The Court rejected this distinction as illusory. The mere failure to satisfy a judgment is not, by itself, a ground to annul a sale. To secure annulment, the plaintiffs must necessarily prove the very issues of simulation and fraud they had already raised in the Manila case. The complaint in Civil Case No. 27996 explicitly alleged that the property sales to Leona Piano and Rosario Chang were fictitious, without consideration, and made to evade Chang Hiok’s liability to the plaintiffs. The defendants in that case defended the sales as bona fide and for valuable consideration. Therefore, any final judgment in the Manila case on the validity of those sales would be res judicata and conclusively settle the issue sought to be relitigated in the Rizal case. The order of dismissal was affirmed.