G.R. No. L-5268 February 23, 1953
Gregorio Cruz, petitioner, vs. Manila Surety & Fidelity Co., Inc., Concepcion Ynciong, assisted by her husband Florentino de Leon, Filemon Leonardo and Andrea Ynciong, respondents.

FACTS

This is a petition for review of a decision of the Court of Appeals which reversed a judgment of the Court of First Instance of Rizal awarding petitioner Gregorio Cruz indemnity. The case originated from a forcible entry action filed by respondents Concepcion Ynciong, Andrea Ynciong, and Filemon Leonardo against petitioner Gregorio Cruz in the Justice of the Peace Court of Parañaque, Rizal. In that forcible entry case, the respondents obtained a writ of preliminary injunction upon filing a bond from Manila Surety & Fidelity Co., Inc., and took possession of the disputed property, harvesting the palay standing thereon. The writ was later lifted when Cruz posted a counter bond, and the land was returned after the palay harvest. Subsequently, Cruz filed a certiorari action in the Court of First Instance challenging the proceedings in the forcible entry case, and the court declared all proceedings null and void for lack of jurisdiction. Five months later, on July 21, 1947, Cruz filed a separate action for damages in the Court of First Instance against the respondents and the bonding company, claiming losses from his dispossession and the consequential damages from the forcible entry case. The defendants moved to dismiss, arguing the action had no legal basis because the claim for damages was not included in the judgment of the certiorari case as required by the Rules of Court. The motion was denied, and the trial court rendered a decision ordering defendants to pay damages. The Court of Appeals reversed this decision, absolving the defendants.

ISSUE

Whether petitioner Gregorio Cruz can institute a separate action for damages allegedly suffered from the issuance of a writ of preliminary injunction in the forcible entry case, or whether his claim is barred for failure to press it in the principal action as required by the Rules of Court.

RULING

The Supreme Court affirmed the decision of the Court of Appeals in holding that petitioner has no right to institute the present separate action for damages. The Court ruled that a claim for damages suffered due to the issuance of a preliminary injunction must be presented in the principal action and included in the final judgment, as expressly required by section 9, Rule 60, in connection with section 20, Rule 59 of the Rules of Court. This procedure is exclusive, and failure to file the claim in the principal action while the court still has control over the judgment results in the loss of the right to such damages, preventing a separate action. However, the Supreme Court reversed the Court of Appeals’ finding that petitioner had no right to claim damages for the loss of the palay solely based on not being the lawful owner of the land, noting that ownership of land and ownership of improvements are separate, and petitioner may have made improvements in good faith. The Court held that petitioner is not barred from pressing his claim for damages in the still-pending forcible entry case in the Justice of the Peace Court of Parañaque, Rizal, as the certiorari decision only nullified the injunction proceedings for excess of jurisdiction but did not dismiss the case. The decision was affirmed in part and reversed in part, without prejudice to petitioner presenting his claim in the forcible entry case.