GR 85450; (July, 1990) (Digest)
G.R. No. 85450 July 3, 1990
QUERICO DELA CRUZ and EUGENIA BALAJADIA, petitioners, vs. HON. COURT OF APPEALS and MARIA DE JESUS, respondents.
FACTS
Petitioners Querico Dela Cruz and Eugenia Balajadia filed an action for ownership and quieting of title over a house built on a lot leased from the Philippine National Railway (PNR). They claimed they constructed the house in 1962 after their previous home burned down, having verbally purchased the leasehold rights from respondent Maria De Jesus. They presented a 1962 building permit, tax declarations, and receipts for construction materials. De Jesus countered that she built the house herself in 1962 after a fire and merely allowed the petitioners to rent a portion of it. She presented her own building permit from 1962 and a lease contract with the PNR dating back to 1954. A prior unlawful detainer case filed by De Jesus against the petitioners had resulted in a final and executory judgment in her favor, leading to their eviction, though they subsequently returned.
ISSUE
The core issue is whether the petitioners have successfully proven ownership of the house in question, thereby overturning the factual findings of the lower courts which ruled in favor of De Jesus.
RULING
The Supreme Court denied the petition and affirmed the Court of Appeals’ decision, upholding De Jesus as the owner of the house. The Court emphasized that factual findings of the trial court, affirmed by the appellate court, are generally conclusive and binding. It found the petitioners’ evidence insufficient to overcome De Jesus’s claim. Her earlier and continuous leasehold rights over the PNR lot since 1954, coupled with her own building permit, strongly supported her ownership of the improvements. The Court also ruled that the final judgment in the ejectment case, while conclusive on the issue of possession (establishing De Jesus’s superior right of possession at that time), did not constitute res judicata on the question of ownership, as inferior courts in ejectment suits have no jurisdiction to definitively settle title. However, the Court modified the appellate decision by disallowing the substitution of Jose Bagaybagayan as a party after De Jesus’s death. It held that the “Transfer of Rights” over the leasehold to Bagaybagayan was irrelevant to the action concerning the house’s ownership and was ineffective without the PNR’s consent as the landowner. The petition was denied for lack of merit.