G.R. No. 179011 ; April 15, 2013
REY CASTIGADOR CATEDRILLA, Petitioner, vs. MARIO and MARGIE LAURON, Respondents.

FACTS

Petitioner Rey Castigador Catedrilla filed a Complaint for ejectment with the Municipal Trial Court (MTC) of Lambunao, Iloilo against respondents Mario and Margie Lauron. Petitioner alleged he is a co-owner of a parcel of land (Lot No. 5, a subdivision of Lot 183) by virtue of being an heir of Lilia Castigador. He claimed that respondents, through the tolerance of the heirs, constructed a residential building on the lot around 1980. Despite demands to vacate, respondents unlawfully withheld possession.
Respondents, in their Answer, claimed petitioner had no cause of action as the owner of the building was Mildred Kascher (sister of respondent Margie), as shown by a tax declaration. They asserted that in 1992, Mildred paid a downpayment for the lot to Teresito Castigador, and that in 1998, an amicable settlement was entered before the Barangay Lupon wherein petitioner’s father, Maximo Catedrilla, offered to sell the lot to Mildred and her husband for ₱90,000.00. Respondents argued this settlement had the force of a final judgment, barring the suit.
The MTC ruled in favor of petitioner, ordering respondents to vacate, pay attorney’s fees, reasonable compensation for use, and costs. It found petitioner, as a co-owner, could bring the action under Article 487 of the Civil Code and Section 1, Rule 70 of the Rules of Court. It held respondents were the proper parties to sue as occupants and that the amicable settlement did not bind the parties or preclude the ejectment action. The Regional Trial Court (RTC) affirmed the MTC decision but deleted the award of attorney’s fees for lack of basis.
The Court of Appeals (CA) reversed the RTC and dismissed the complaint. The CA held that the other co-heirs of petitioner were indispensable parties who should have been joined as plaintiffs under Section 7, Rule 3 of the Rules of Court, and their absence warranted dismissal. The CA also noted petitioner was aware the real owner of the house was Mildred Kascher, to whom his co-owners had offered the property for sale.

ISSUE

Whether the Court of Appeals erred in dismissing the ejectment complaint on the ground that petitioner’s co-owners are indispensable parties who were not impleaded.

RULING

Yes, the Court of Appeals erred.
The Supreme Court reversed the CA decision and reinstated the MTC decision as affirmed by the RTC. The Court held that in an ejectment suit, the sole issue is physical or material possession (possession de facto). A co-owner may bring such an action without joining all other co-owners. Article 487 of the Civil Code provides that “any one of the co-owners may bring an action in ejectment.” This is a substantive right granted by law, not merely a procedural rule. The action is deemed instituted for the benefit of all co-owners. Therefore, petitioner, as a co-owner, could validly file the ejectment case alone.
The Court further ruled that respondents were the proper parties-defendants as they were the actual occupants and possessors of the property. The claim that Mildred Kascher was the owner of the house and an indispensable party was without merit. The subject of the action was possession of the land, not ownership of the house. The tax declaration in Mildred’s name was not conclusive proof of ownership. Moreover, the amicable settlement before the Barangay Lupon did not constitute a perfected contract of sale; it was merely an agreement to sell subject to conditions, specifically the preparation of documents proving Maximo’s ownership. Since Maximo failed to comply with this condition, no sale was consummated, and the settlement did not bar the ejectment case.
The Supreme Court concluded that petitioner, a co-owner, had a better right to possession, and respondents’ possession, initially by tolerance, had become unlawful upon demand to vacate. The dismissal by the CA on the ground of non-joinder of indispensable parties was incorrect.