G.R. No. 29155, November 5, 1928 (Amended December 10, 1928)
JOSEFINA RUBIO DE LARENA, plaintiff-appellant, vs. HERMENEGILDO VILLANUEVA, defendant-appellee.

FACTS

This case arose from a prior litigation (G.R. No. 21706) where the Supreme Court affirmed the rescission of a lease contract over the Tacgajan Sugar Plantation and ordered the lessee, Hermenegildo Villanueva, to pay unpaid rents and deliver possession to the lessor, Josefina Rubio de Larena. After the decision became final, the parties entered into a compromise agreement, satisfied by Villanueva’s payment of P10,500 and transfer of a house, which Larena acknowledged in a document dated September 30, 1924.

Subsequently, Larena filed a new complaint with three causes of action: (1) for the value of the sugarcane harvest for the agricultural year 1922-1924, which Villanueva appropriated after the lease was judicially rescinded but before possession was returned; (2) for the value of missing personal property (e.g., animals, tools) from the hacienda inventory that Villanueva failed to return; and (3) for the value of the ratoon cane crop harvested by Villanueva in the agricultural year 1924-1925, after the lease had been fully terminated and possession should have been delivered.

The trial court absolved Villanueva based on the defense of res judicata and the satisfaction document. Larena appealed.

ISSUE

1. Whether the first and third causes of action (for the harvests of 1922-1924 and 1924-1925) are barred by res judicata.
2. Whether the defendant is liable for the missing personal property under the second cause of action.
3. The proper computation of damages for the harvested crops.

RULING

1. On Res Judicata (First and Third Causes of Action): The Supreme Court held that the claims for the harvests were not barred by res judicata. The rule under Section 307 of the Code of Civil Procedure states that only matters expressly adjudged or necessarily included in the prior judgment are deemed concluded. The prior case (G.R. No. 21706) dealt with the rescission of the lease and unpaid rents up to a specific period. The harvests in question pertained to periods after the lease was judicially declared rescinded. These claims for fruits (harvests) derived from the lessor’s ownership after the lease ended, which constituted a separate cause of action not litigated nor necessary to the prior judgment for rescission and back rent.

2. On Liability for Missing Property (Second Cause of Action): The Court affirmed the trial court’s dismissal of this claim. The evidence indicated the missing animals died from rinderpest (a fortuitous event), and the other items had been turned over to the sheriff. The plaintiff’s claim was inconsistent across amended complaints, weakening her case. Liability, if any, would lie against the sheriff, not the defendant.

3. On Computation of Damages:
* First Cause of Action (Harvest 1922-1924): Villanueva retained possession in bad faith after the lease was rescinded. A possessor in bad faith is liable for all fruits received (Article 433, Civil Code). He must account for the entire net harvest he received, which amounted to P8,000.
* Third Cause of Action (Ratoon Crop 1924-1925): Villanueva’s possession during this period was entirely without right. As a possessor in bad faith, he is liable for the fruits received, less only the necessary expenses of production (Articles 453 & 455, Civil Code). The gross ratoon crop was 3,226.50 piculs. Villanueva received half (1,613.25 piculs) after ceding the other half to the sugar central as milling compensation, but he bore the full cost of production. The net value of the total crop, after deducting production costs, was P3,226.50, which he must pay to Larena.

DISPOSITIVE PORTION (As Amended):
The trial court’s judgment was AFFIRMED regarding the second cause of action. It was REVERSED regarding the first and third causes of action. Plaintiff Josefina Rubio de Larena was awarded a total of P11,226.50 (P8,000 + P3,226.50), with legal interest at 6% per annum from the filing of the complaint (April 13, 1925). No costs awarded.