G.R. No. 148361 November 29, 2005
RAFAEL BAUTISTA and LIGAYA ROSEL, Petitioners, vs. MAYA-MAYA COTTAGES, INC., Respondent.

FACTS

Petitioners Rafael Bautista and Ligaya Rosel are the registered owners of a lot in Nasugbu, Batangas, covered by OCT No. P-1436. Respondent Maya-Maya Cottages, Inc. (MMCI) filed a complaint for cancellation of title and damages, alleging petitioners obtained their title through dubious means. Petitioners moved to dismiss, arguing MMCI, as a private corporation, is constitutionally disqualified from acquiring alienable public lands except by lease and thus lacks a cause of action. The Regional Trial Court initially granted the dismissal.
Respondent filed a motion for reconsideration with a motion for leave to file an amended complaint, shifting the theory to quieting of title and alleging the technical description in petitioners’ title does not cover the disputed property. Petitioners opposed, contending the amended complaint still fails to state a cause of action and substantially alters the theory. The trial court reversed its earlier order, denied the motion to dismiss, and admitted the amended complaint. Petitioners elevated the matter via certiorari and prohibition to the Court of Appeals, which dismissed their petition.

ISSUE

Whether the Court of Appeals erred in holding that the trial court did not commit grave abuse of discretion in admitting respondent’s amended complaint.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals. The legal logic centers on Section 2, Rule 10 of the 1997 Rules of Civil Procedure, which allows a party to amend a pleading once as a matter of right at any time before a responsive pleading is served. A motion to dismiss is not considered a responsive pleading under this rule. Since petitioners had filed only a motion to dismiss and not an answer or other responsive pleading, respondent retained the absolute right to amend its complaint. This right persists even after an order dismissing the original complaint, provided that order is not yet final. The amendment was permissible regardless of the introduction of a new cause of action or a change in theory, as the rule is designed to facilitate a complete adjudication on the merits. Consequently, the trial court acted within its discretion in admitting the amended complaint, and no grave abuse of discretion warranting certiorari or prohibition existed. The Court further noted that petitioners’ contention regarding respondent’s constitutional incapacity to acquire land is a matter of defense best resolved during a full trial on the merits.