G.R. No. 221047. September 14, 2016.
MICHAEL A. ONSTOTT, PETITIONER, VS. UPPER TAGPOS NEIGHBORHOOD ASSOCIATION, INC., RESPONDENT.

FACTS

Albert Onstott, an American citizen, was the registered owner of a parcel of land in Rizal. Due to unpaid realty taxes, the property was sold at a public auction to Amelita De Serra. Respondent Upper Tagpos Neighborhood Association, Inc. (UTNAI), representing the occupants, redeemed the property from De Serra. UTNAI then filed a complaint for cancellation of Albert’s title and issuance of a new one in its name before the Regional Trial Court (RTC). Summons was served by publication as Albert was a non-resident. He was declared in default, and the RTC ruled in favor of UTNAI, ordering the cancellation of Albert’s title and the issuance of a new one to UTNAI.
Subsequently, petitioner Michael Onstott, claiming to be Albert’s legitimate son, filed a Petition for Relief from Judgment. He alleged that UTNAI fraudulently failed to implead him and his mother, Josephine, as indispensable parties, knowing Albert was already deceased. He also argued UTNAI lacked the legal personality to redeem the property. The RTC denied the petition but found its prior decision never attained finality due to failure to serve the judgment by publication on Albert. Consequently, it directed the Register of Deeds to cancel UTNAI’s title and reinstate Albert’s. Both parties appealed to the Court of Appeals (CA).

ISSUE

The core issue is whether the RTC’s Decision dated March 30, 2009, attained finality and validity, considering the alleged failure to serve it by publication on the defendant and the failure to implead the alleged compulsory heirs of the deceased registered owner.

RULING

The Supreme Court denied the petition and affirmed the CA’s ruling. The Court held that the RTC Decision had attained finality. The requirement for service of judgment by publication under Section 9, Rule 13 of the Rules of Court applies only when the defendant, who was summoned by publication, fails to appear. Here, Albert was declared in default for failure to file an answer, which is a form of appearance. Therefore, the rules on service of judgments upon a party who has appeared apply, not the publication rule. The RTC’s subsequent finding of non-finality was a reversible error.
On the matter of parties, the Court ruled that Michael failed to substantiate his claim of being an indispensable party. He did not sufficiently prove his legitimacy as Albert’s son or that the property was conjugal, merely presenting an unauthenticated birth certificate and a marriage contract. A party claiming to be an heir must prove his status with competent evidence, which Michael did not do. Furthermore, the action was one for cancellation of title based on UTNAI’s redemption, not an action for settlement of Albert’s estate. The alleged heirs were not indispensable parties to that specific action. The Court also found UTNAI had the legal interest to redeem as an association representing the actual occupants, which constitutes a “person having legal interest” under the Local Government Code. Thus, the RTC’s original judgment was valid and final.