G.R. No. L-39338. July 16, 1984.
Douglas B. Alvir, petitioner, vs. Hon. Rizalina B. Vera, as Presiding Judge, Court of First Instance of Rizal, Branch XXIII, Bernardo Mollat and Teresa Mollat, respondents.

FACTS

Petitioner Douglas B. Alvir, the registered owner of a property in San Juan, Rizal, filed an unlawful detainer complaint against private respondents Bernardo and Teresa Mollat before the Municipal Court. Alvir acquired the property through the settlement of his father’s estate and demanded that the Mollats vacate as he needed the premises. The Mollats refused, claiming they were authorized to occupy the property by a certain Howard J. Weber. They asserted that Weber had purchased the property from the Alvir family in 1961 under a contract of sale, and they were his tenants. The Municipal Court ruled in favor of Alvir, ordering the Mollats to vacate and pay rentals.
The Mollats appealed to the Court of First Instance (CFI). The CFI set aside the Municipal Court’s decision and dismissed the complaint. It found that the Mollats’ claim of possession was based on authority from Weber, who in turn claimed ownership rights via a deed of sale from the Alvirs. The CFI concluded that the issue of possession could not be resolved without first settling the question of ownership arising from the disputed sale between the Alvirs and Weber, a matter beyond the jurisdiction of an ejectment court.

ISSUE

Whether the Court of First Instance correctly dismissed the ejectment case on the ground that the principal issue involved a determination of ownership, thereby divesting the inferior court of jurisdiction.

RULING

The Supreme Court reversed the CFI’s judgment of dismissal but affirmed its underlying jurisdictional finding. The Court reiterated the established rule that in ejectment cases, the sole issue is physical or de facto possession. A defendant’s mere claim of ownership does not oust the inferior court’s jurisdiction. However, jurisdiction is lost if, during trial, it becomes apparent that the question of possession cannot be resolved without first settling the issue of ownership.
Here, the evidence presented revealed that the Mollats’ right to possess was directly derived from Weber’s claim of ownership under a deed of sale, which the Alvirs contested for alleged non-compliance. This created a situation where the issue of physical possession was inextricably linked to the validity of the sale and the question of lawful ownership. Consequently, the Municipal Court lost jurisdiction over the ejectment suit. Nevertheless, the Supreme Court ruled that the CFI, on appeal, should not have simply dismissed the case. Applying Section 11, Rule 40 of the Revised Rules of Court and jurisprudence, the CFI should have exercised its original jurisdiction over the case, as the parties had already submitted their pleadings and evidence on the substantive merits. Therefore, the case was remanded to the CFI to proceed with the trial in the exercise of its original jurisdiction.