G.R. No. 222166 , June 10, 2020
MERCEDES S. GATMAYTAN AND ERLINDA V. VALDELLON, PETITIONERS, VS. MISIBIS LAND, INC., RESPONDENT.

FACTS

On December 9, 1991, petitioners Mercedes S. Gatmaytan and Erlinda V. Valdellon purchased a parcel of land from Spouses Oscar and Cidra Garcia, covered by TCT No. T-77703. On April 6, 1992, they annotated the Deed of Absolute Sale on the title but could not transfer it to their names due to lack of a DAR clearance. In 2010, they discovered that the land had been consolidated and subdivided by respondent Misibis Land, Inc. (MLI). Investigation revealed that the Spouses Garcia executed another Deed of Absolute Sale over the same property to DAA Realty Corporation on February 21, 1996, resulting in the issuance of TCT No. T-97059 to DAA Realty. DAA Realty then sold the property to MLI on April 21, 2005, resulting in TCT No. T-138212. Petitioners annotated an Affidavit of Adverse Claim on MLI’s titles on September 1, 2010. On December 10, 2014, they filed a complaint before the RTC against Spouses Garcia, DAA Realty, MLI, and Philippine National Bank. Their complaint contained multiple causes of action: (1) Declaration of Ownership and Nullity of the 1996 and 2005 Deeds of Absolute Sale and the mortgage; (2) First Alternative Cause of Action for Declaration of Nullity based on Double Sale; (3) Second Alternative Cause of Action for Quieting of Title; (4) Second Cause of Action for Accounting and Remittance of Income; (5) Third Cause of Action for Exemplary Damages; (6) Fourth Cause of Action for Moral Damages; and (7) Fifth Cause of Action for Attorney’s Fees. The RTC dismissed the complaint on grounds of prescription and lack of jurisdiction. Petitioners’ motion for reconsideration was denied. They filed a petition for review on certiorari with the Supreme Court.

ISSUE

Whether Petitioners’ Complaint should be allowed to proceed for trial on the merits.

RULING

Yes, the Supreme Court granted the petition and ruled that the Complaint should proceed to trial. The Court held that under Section 2, Rule 8 of the Rules of Court, a party may set forth alternative causes of action. A complaint containing alternative causes of action cannot be dismissed if one of them states a sufficient cause of action. The Court analyzed the alternative causes of action. It found that the action for reconveyance based on an implied trust, arising from the alleged fraudulent second sale by the Spouses Garcia to DAA Realty, had prescribed. Such an action prescribes in ten years from the issuance of the title to the alleged fraudulent transferee (DAA Realty’s title issued in 1996; complaint filed in 2014). However, the Court ruled that the alternative cause of action for quieting of title, as pleaded, remained viable. An action for quieting of title is imprescriptible when the plaintiff is in possession of the property. The petitioners alleged that they were in constructive possession through the Spouses Garcia as trustees. This allegation, if proven, could establish that the action for quieting of title had not prescribed. Since the sufficiency of one alternative cause of action (quieting of title) precludes outright dismissal, the RTC erred in dismissing the complaint. The case was remanded to the RTC for further proceedings.