G.R. No. 221586 . September 14, 2021
ZENAIDA D. ROA, PETITIONER, VS. SPS. ROBINSON K. AND MARY VALERIE S. SY, MARIE ANTOINETTE R. FRANCISCO, AND THE REGISTER OF DEEDS OF MAKATI CITY, RESPONDENTS.

FACTS

Petitioner Zenaida D. Roa, together with her sister Amelia Roa, were the registered owners of a property in Makati City under TCT No. 133936. Petitioner discovered that their title had been cancelled and a new TCT was issued in the name of their niece, respondent Marie Antoinette R. Francisco, by virtue of a deed of sale purportedly executed by petitioner and Amelia in favor of Francisco on July 6, 2012. Petitioner alleged it was impossible for her to have signed the deed as she was abroad from March 20, 2012, to August 24, 2012, and that Amelia could not have signed voluntarily due to Alzheimer’s disease. Francisco subsequently sold the property to respondent Spouses Robinson K. and Mary Valerie S. Sy on July 20, 2012, for P35,000,000.00, and a new TCT was issued in their names. Petitioner filed a complaint for cancellation of deeds of sale, annulment of title, and reconveyance with damages against Francisco, the Spouses Sy, and the Register of Deeds of Makati. The Spouses Sy filed a motion to dismiss on the ground of failure to state a cause of action, arguing the complaint contained no specific averments of bad faith on their part and that they were buyers in good faith. The Regional Trial Court denied the motion to dismiss. The Spouses Sy filed a petition for certiorari with the Court of Appeals, which reversed the RTC and dismissed the complaint, ruling that petitioner failed to allege an ultimate fact—specifically, when the Spouses Sy started negotiating with Francisco—necessary to determine if they exercised due diligence, and that they were not obliged to look beyond Francisco’s title which contained no adverse claim.

ISSUE

Did the Court of Appeals commit reversible error when it dismissed the complaint against Spouses Sy on the ground that petitioner has no cause of action against them, albeit what the latter actually pleaded was another ground, that is, failure to state a cause of action?

RULING

Yes. The Court of Appeals erred in dismissing the complaint on the ground of lack of cause of action. The Spouses Sy sought dismissal specifically on the ground of failure to state a cause of action. It was reversible error for the Court of Appeals to motu proprio take cognizance of an entirely different ground, i.e., lack of cause of action, to justify the dismissal. Courts may not motu proprio dismiss a complaint based on a ground not pleaded by a party, except in specific instances such as lack of jurisdiction over the subject matter, litis pendentia, res judicata, or prescription, which are not present here. The test for a motion to dismiss based on failure to state a cause of action is whether, admitting the facts alleged in the complaint, the court can render a valid judgment in accordance with the prayer. The complaint alleged that the Spouses Sy purchased the property from Francisco despite the fraudulent title and with knowledge of suspicious circumstances, which, if proven, could establish a cause of action for reconveyance. Any perceived defect or vagueness in the complaint had been cured by petitioner’s subsequent filing of a bill of particulars in compliance with the RTC’s order. The Court of Appeals should not have dismissed the complaint but should have allowed the case to proceed to trial on the merits.