G.R. No. 101818 September 21, 1993
MARIETTA P. SANTOS and FERMINA M. PANGANIBAN, petitioners, vs. COURT OF APPEALS, PILIPINAS BANK, TIRSO ANTIPORDA, FELIPE GELLA, ED DAVID, PASTOR REYES, JR., ET. AL., respondents.

FACTS

On August 23, 1979, the Court of First Instance of Pasig rendered judgment in Civil Case No. 28779 ordering defendants, including Luis D. Santos (husband of petitioner Marietta P. Santos), to pay Pilipinas Bank P500,000.00. The judgment became final. To satisfy the judgment, the sheriff levied upon the residential property of the spouses Luis and Marietta Santos in Dasmariñas Village. At the auction sale, Pilipinas Bank was the highest bidder, and a certificate of sale was issued on April 24, 1980. Pilipinas Bank later redeemed the property from International Corporate Bank, which had previously foreclosed on it.
Subsequent attempts by the Santos spouses to challenge the execution and sale (Civil Case Nos. 40946 and 42467) were dismissed. Their petition to the Supreme Court (G.R. No. 59769) was denied. On October 23, 1984, Pilipinas Bank filed an omnibus motion to cancel the title and obtain a writ of possession, which was granted. Despite negotiations for repurchase and a draft Contract to Sell furnished by the bank, the Santos spouses failed to come up with the purchase price. The bank obtained alias writs of possession. Petitioner Marietta Santos filed a petition for certiorari (CA-G.R. SP No. 09210) to stay execution, which was dismissed by the Court of Appeals. Her petition for review (G.R. No. 78640) was denied by the Supreme Court, though she was granted seven days to remove her things from the premises.
On July 3, 1987, petitioners Marietta P. Santos and Fermina M. Panganiban filed a complaint (Civil Case No. 17197) against private respondents. Their first cause of action was founded on equity and promissory estoppel, praying to be allowed to redeem or purchase the property. Their second, alternative cause of action was for damages due to alleged tortious acts in the execution of the judgment. The trial court dismissed the complaint based on res judicata. The Court of Appeals affirmed the dismissal of the first cause of action but reversed the dismissal of the alternative cause of action for damages, allowing petitioners to amend their complaint to specify the damages. Petitioners filed the instant recourse.

ISSUE

Whether the first cause of action in Civil Case No. 17197 (for equity/promissory estoppel to redeem/purchase the property) is barred by res judicata.

RULING

Yes, the first cause of action is barred by res judicata. The elements are present: (1) a final former judgment (the decision in Civil Case No. 28779 and the order denying the motion for stay of execution); (2) rendered by a court with jurisdiction; (3) a judgment on the merits; and (4) identity of parties, subject matter, and cause of action between Civil Case No. 28779 and the first cause of action in Civil Case No. 17197.
There is identity of parties. Pilipinas Bank was the plaintiff in the first case and a defendant in the second. Luis D. Santos was a defendant in the first, and Marietta P. Santos (his wife) is a plaintiff in the second, representing the same interest concerning their conjugal property. The addition of Fermina M. Panganiban (Marietta’s mother) as a plaintiff does not defeat identity, as she represents the same interest to repurchase the property, and res judicata requires only substantial identity.
There is identity of subject matter: the Dasmariñas Village residential property.
There is identity of cause of action. The motion for stay of execution in Civil Case No. 28779 was based on equitable grounds to allow repurchase. The first cause of action in Civil Case No. 17197 is identically founded on equity and promissory estoppel to allow redemption or purchase. The causes of action are the same.
Furthermore, on substantive grounds, petitioners cannot invoke the draft Contract to Sell as a basis for repurchase because it was never perfected. Under Article 1319 of the Civil Code, acceptance must be absolute and communicated. Petitioners failed to absolutely accept and communicate their acceptance to Pilipinas Bank; the contract remained in negotiation.
The petition is DENIED. The decision of the Court of Appeals is AFFIRMED.