G.R. No. 237871 , September 18, 2019
MARGARITA FERNANDO, FELIX FERNANDO AND MANUEL FERNANDO, SUBSTITUTED BY HIS LEGAL HEIRS, NAMELY: JOSEFINA FERNANDO ANDAYA AND MARIA CONSOLACION FERNANDO PARASO, PETITIONERS, VS. ROSALINDA RAMOS PAGUYO; HEIRS OF LEONARDO RAMOS, NAMELY: EDNA RAMOS DIMLA, ANDREA RAMOS MIRASOL, AND ERMINIA RAMOS SAUL; VIRGILIO RAMOS REPRESENTED BY CHARLIE RAMOS ALZATE; TEODORICO RAMOS; AURORA RAMOS DELA CRUZ; VIRGINIA RAMOS PADILLA; RODOLFO RAMOS; AND ROSITA RAMOS FLORES, RESPONDENTS.

FACTS

The respondents and Lucena Ramos are the nine children and heirs of spouses Dominador Ramos and Damiana Porciuncula, who owned an agricultural land in Nueva Ecija (the subject property). After the spouses died in 1945, Lucena unilaterally executed a Declaration of Heirship in 1952, had the property transferred to her name, and subsequently sold it to Tomas Fernando through a pacto de retro sale in 1955. In 1955, the respondents filed Civil Case No. 2146 against Lucena and her husband Alfredo Mateo. The CFI decision, which became final and executory in 1961, ordered the cancellation of Lucena’s title, the issuance of a new title in favor of all nine legal heirs, the partition of the property among them, and sentenced Lucena to pay Tomas Fernando P8,800.00, with the shares of four heirs subject to an equitable mortgage in favor of Tomas.
In 1993, petitioners Margarita, Felix, and Manuel Fernando (collateral heirs of Tomas Fernando) learned of this decision and entered into a verbal agreement with spouses Lucena and Alfredo, wherein the spouses agreed to abide by the 1961 decision, allow the Fernandos to take possession of the owner’s copy of the title, and execute necessary documents by 1997. When the spouses failed to comply, the petitioners filed Civil Case No. 31-SD(97) for specific performance and damages against only the spouses Lucena and Alfredo in 1997. The RTC rendered a decision in 2001 declaring consolidation of ownership in Tomas Fernando and ordering the issuance of a new title in his name. This decision became final and executory. Consequently, titles were issued first in the name of Tomas Fernando and then transferred to the petitioners.
The respondents, who were not impleaded in Civil Case No. 31-SD(97), filed a Petition for Annulment of Decision and Damages under Rule 47 before the CA in 2006, praying for the annulment of the 2001 RTC decision. The CA granted the petition and annulled the RTC decision. The petitioners elevated the case to the Supreme Court via a Petition for Review on Certiorari.

ISSUE

Whether the Court of Appeals erred in annulling the Decision dated September 21, 2001 of the Regional Trial Court in Civil Case No. 31-SD(97) for lack of jurisdiction due to the non-joinder of indispensable parties.

RULING

The Supreme Court DENIED the petition and AFFIRMED the CA Decision and Resolution. The Court held that the respondents are co-owners of the subject property and are indispensable parties in Civil Case No. 31-SD(97). An indispensable party is one without whom no final determination can be had of the action, and whose interest will be directly affected by the judgment. The 1961 decision in Civil Case No. 2146 established the respondents as co-owners, each with a 1/9 share. The complaint in Civil Case No. 31-SD(97) sought to enforce an oral agreement that effectively covered the entire property, including the shares of the respondents who were not parties to that agreement. The spouses Lucena and Alfredo had no authority to represent or bind their co-heirs. Therefore, the RTC could not validly render a judgment consolidating ownership of the entire property without the respondents being impleaded. The RTC’s decision was rendered without jurisdiction, warranting its annulment under Rule 47. Consequently, the titles derived from that void decision (TCT No. N-32644 and TCT No. N-34698) must be cancelled. The Court also found that the respondents’ Petition for Annulment was proper as they could not have appealed the RTC decision since they were not impleaded, and their failure to avail of remedies was not due to their own fault or negligence.