G.R. No. L-20495 August 31, 1968
BELEN CRUZ, plaintiff-appellant, vs. LUIS M. SIMON DOMINGO MOSSESGELD, ET AL., defendants-appellees.

FACTS

On September 25, 1961, plaintiff-appellant Belen Cruz filed a complaint in the Court of First Instance of Nueva Ecija (Civil Case No. 3738) against several defendants. She alleged she acquired ownership and possession of four lots in Cabanatuan City through a contract of sale executed on September 3, 1949, by Pedro M. Maximino Mossesgeld et al., and was placed in actual possession. She claimed that on March 22, 1955, defendant Luis M. Simon Domingo Mossesgeld fraudulently sold the same lots to defendant Raquel Salamanca, who knew of the prior sale. Salamanca secured a new title (TCT No. 3034), mortgaged the lots to the Philippine National Bank (PNB), and later sold Lots 1 and 2 to her niece, defendant Angela Concepcion. The complaint sought declarations of nullity for the subsequent deeds and titles, recognition of plaintiff’s ownership, and damages.
Defendants Raquel Salamanca, Carlos Salamanca, Angela Concepcion, and Honorato Perez moved to dismiss the complaint on two grounds: (1) the cause of action was barred by a prior judgment, and (2) there was no cause of action against them. They alleged that a prior case, Civil Case No. 2773, entitled “Belen Cruz vs. Luis M. Simon Domingo Mossesgeld and the Spouses Raquel Salamanca and Carlos Salamanca,” involving the same subject matter and parties (except the Concepcion spouses), had been dismissed by the court on February 10, 1961, for failure of the parties to prosecute. The order of dismissal did not state it was without prejudice. They argued the dismissal was with prejudice and constituted res judicata. The lower court granted the motion to dismiss on January 12, 1962, and denied plaintiff’s motion for reconsideration on February 12, 1962, prompting this appeal.

ISSUE

Whether the lower court correctly dismissed the complaint against defendants-appellees (the Salamanca and Concepcion spouses) on the ground that the cause of action was barred by a prior judgment (res judicata).

RULING

Yes, the lower court correctly dismissed the complaint. The Supreme Court affirmed the orders of dismissal.
The dismissal of the prior case, Civil Case No. 2773, for failure to prosecute and without any reservation by the court that it was without prejudice, operated as a dismissal with prejudice or an adjudication upon the merits, pursuant to Section 3, Rule 30 of the old Rules of Court (now Section 3, Rule 17 of the Revised Rules of Court). The elements of res judicata were present: (1) There was a final order (the dismissal) in the prior case; (2) The court that rendered it had jurisdiction over the subject matter and the parties (the Salamanca spouses, who are movants in the instant case, had filed their answer in the prior case); (3) There was a judgment on the merits (the dismissal with prejudice); and (4) There was identity of parties, subject matter, and cause of action between the two cases.
The addition of defendants Angela Concepcion and Honorato Perez in the new case was immaterial because they merely derived their rights from defendant Raquel Salamanca after the judgment in the first case had become final. They essentially stepped into her shoes regarding Lots 1 and 2. Therefore, the cause of action against all appellees was barred by the prior judgment. The orders dated January 12, 1962, and February 12, 1962, were affirmed.