G.R. No. 237720 , February 05, 2020
Alvin F. Samonte, Petitioner, vs. Demetria N. Domingo, married to Daniel Sb. Domingo, Respondent.

FACTS

Demetria N. Domingo filed a Complaint for Unlawful Detainer against Alvin F. Samonte before the Metropolitan Trial Court (MeTC) of Manila, alleging she bought a residential house from Samonte via a Deed of Sale of Residential House executed on July 8, 2011, but Samonte refused to vacate the property. Samonte, in his Answer, denied the sale, claiming he merely obtained a loan from Domingo and signed what he believed to be a mortgage document, having been defrauded due to his dire need for money. The MeTC dismissed the complaint for Domingo’s failure to prove a lease contract and that a demand letter was sent and received. On appeal, the Regional Trial Court (RTC) Branch 24 reversed the MeTC, ordering Samonte to vacate, finding the allegation of a demand sufficient and that unlawful detainer is not limited to lessors. Samonte’s motion for reconsideration was denied.
During the pendency of Samonte’s petition for review with the Court of Appeals (CA) on the unlawful detainer case, he instituted a separate action for annulment of the deed of sale and damages before the RTC Branch 32. On May 25, 2016, the RTC Branch 32 declared the Deed of Sale null and void, ruling the transaction was an equitable mortgage securing Samonte’s debt, which had been paid through rental fees from tenants remitted to Domingo. This annulment decision was affirmed by the CA in a separate case (CA-G.R. CV No. 107254) on August 10, 2017, and became final and executory on September 15, 2017.
Nevertheless, the CA, in its Decision dated August 17, 2017 on the unlawful detainer case (CA-G.R. SP No. 144022), denied Samonte’s petition and affirmed the RTC Branch 24’s ruling, holding Domingo proved her right of possession based on the Deed, though noting the ownership determination was provisional. Samonte’s motion for reconsideration, citing the final annulment of the Deed as a supervening event, was denied by the CA.

ISSUE

Whether Domingo has the right to possess the subject property, considering that the Deed of Sale she relied upon in filing her complaint was declared null and void in a separate case.

RULING

The Petition is GRANTED. The Supreme Court reversed and set aside the CA Decision and Resolution in the unlawful detainer case and dismissed the Complaint for Unlawful Detainer.
The Court held that the doctrine of res judicata, specifically in the concept of conclusiveness of judgment, applies. While the unlawful detainer case (involving possession) and the annulment case (involving the deed’s validity) have different causes of action, they involve the same parties and subject matter. The final and executory Decision in the annulment case, which declared the Deed of Sale null and void, conclusively settled the issue of the Deed’s validity. Consequently, Domingo can no longer claim any right to possess the property based on that void Deed. Although the issue in unlawful detainer is solely physical possession, and courts may rule on ownership only provisionally to determine the better right of possession, the supervening final judgment nullifying the very document upon which Domingo’s claim of possession rests bars her from asserting a right derived from it. The finality of the annulment judgment rendered it immutable and binding on the parties, thus precluding Domingo’s claim to possession in the ejectment case.