G.R. No. 171286 ; June 2, 2014
DOLORES CAMPOS, Petitioner, vs. DOMINADOR ORTEGA, SR. and JAMES SILOS, Respondents.

FACTS

Petitioner Dolores Campos, through her attorney-in-fact, filed a complaint for specific performance and damages against respondents Dominador Ortega, Sr. and James Silos. Petitioner alleged that she and her family occupied a residential structure on a government-owned lot in Mandaluyong City, which they leased from Dominga Boloy starting in 1966. In 1977, under the Zonal Improvement Program (ZIP), petitioner was censused and qualified as a bona fide occupant, receiving a house tag number. After Dominga Boloy’s death in 1979, petitioner had a verbal agreement with Clarita Boloy to make improvements on the structure, with the expenses to be applied to rentals, but this agreement was not honored. In 1987, Walter Boloy demanded petitioner’s vacation of the premises, leading to a dismissed ejectment suit. Petitioner, through her representative, followed up with the National Housing Authority (NHA) regarding the award of the lot under the ZIP. During a meeting with the Arbitration and Awards Committee on November 19, 1987, petitioner was given until December 19, 1987, to buy the property. However, petitioner discovered that on November 23, 1987, a Deed of Absolute Sale was executed between Clarita Boloy (representing Helen Telos Boloy Williams) and respondent Ortega over the property (initially identified as Lot 17, Block 7, though petitioner occupied Lot 18, Block 7), and the lot was awarded to respondents on February 4, 1988. Petitioner contended respondents were disqualified as they were not duly censused as renters or sharers and commenced residence only after the qualifying date of August 15, 1975. She sought to have respondents’ acquisition declared void, the title surrendered to the NHA, and her right to purchase the structure recognized. Respondents countered that the complaint stated no cause of action, was barred by prior judgment (a final and executory recovery of possession case in their favor), was prematurely filed for lack of barangay conciliation, and that their Torrens title could not be collaterally attacked. The Regional Trial Court ruled in favor of petitioner, declaring respondents’ acquisition void and ordering the NHA to recognize petitioner’s right to purchase. The Court of Appeals reversed the RTC and dismissed the complaint.

ISSUE

Whether the Court of Appeals correctly set aside the RTC decision and dismissed petitioner’s complaint for specific performance and damages.

RULING

Yes, the Court of Appeals’ decision is affirmed. The Supreme Court held that petitioner’s cause of action had prescribed. An action for specific performance based on a written contract must be brought within ten years from the time the right of action accrues. Petitioner’s cause of action accrued on November 23, 1987, when the Deed of Absolute Sale was executed in favor of respondents, or at the latest on February 4, 1988, when the property was awarded to respondents. Petitioner filed her complaint only on August 17, 1999, which was beyond the ten-year prescriptive period. The Court rejected petitioner’s argument that the filing of the earlier ejectment case interrupted the prescriptive period, as that case involved a different cause of action (recovery of possession) and did not constitute a written extrajudicial demand for specific performance. Furthermore, the Court found that petitioner failed to prove her status as a bona fide occupant or beneficiary under the ZIP, as she did not present the official census list or her certificate of qualification. The Court also noted that the property subject of the sale to respondents was Lot 17, Block 7, while petitioner consistently claimed to occupy Lot 18, Block 7, creating doubt about her claim. Consequently, the Court denied the petition and affirmed the appellate court’s dismissal of the complaint.