G.R. No. 189239 ; November 24, 2010
SPOUSES LETICIA & JOSE ERVIN ABAD, ET AL., Petitioners, vs. FIL-HOMES REALTY and DEVELOPMENT CORPORATION and MAGDIWANG REALTY CORPORATION, Respondents.

FACTS

Respondents, as co-owners of two lots in Parañaque City, filed an unlawful detainer complaint against petitioners before the Metropolitan Trial Court (MeTC). Respondents alleged petitioners occupied the lots since 1980 by mere tolerance and had ignored demands to vacate. Petitioners countered their possession was adverse and continuous for over 30 years, disputing respondents’ predecessor’s title, and argued the issue of ownership must first be resolved. During the case’s pendency, the City of Parañaque initiated expropriation proceedings over the lots for a socialized housing project, and a writ of possession was issued in favor of the City.
The MeTC ruled for respondents, ordering petitioners to vacate and pay compensation, holding respondents retained ownership as no payment had been made to them from the expropriation and that petitioners could not claim a better right merely from the writ as project beneficiaries were not yet named. The Regional Trial Court (RTC) reversed on appeal, dismissing the complaint. The RTC found the element of tolerance from the start of possession was absent, and that the expropriation judgment and writ of possession in favor of the City, which effectively transferred possession, barred the continuation of the unlawful detainer case.

ISSUE

Whether the Court of Appeals erred in reinstating the MeTC’s judgment for unlawful detainer despite the expropriation proceedings and the issuance of a writ of possession transferring the property to the City of Parañaque.

RULING

The Supreme Court denied the petition, affirming the Court of Appeals’ reinstatement of the MeTC decision. The Court clarified that the expropriation proceedings did not divest the MeTC of jurisdiction over the unlawful detainer case. Jurisdiction, once acquired, is not lost by subsequent events, including the initiation of expropriation. The writ of possession issued in the expropriation case merely placed the City in physical possession for the public purpose but did not automatically transfer ownership or nullify the respondents’ right to seek compensation for the petitioners’ use and occupancy prior to the taking. Ownership remains with the respondents until full payment of just compensation. Consequently, respondents’ cause of action for unlawful detainer, rooted in their right of possession as owners prior to the expropriation, remained viable. The Court also upheld the finding of possession by tolerance, noting petitioners’ admission they entered without the original owner’s permission and respondents’ acquiescence for years, which created an implied promise to vacate upon demand. The demand to vacate in 2002 thus made the withholding of possession unlawful from that point.