G.R. No. L-10548; April 25, 1958
BALTAZAR RAYMUNDO and AGAPITA SAN JUAN, plaintiffs-appellants, vs. FELISA A. AFABLE and ESTATE OF BRAULIO SANTOS, defendants-appellees.

FACTS

On August 29, 1953, plaintiffs Baltazar Raymundo and Agapita San Juan filed Civil Case No. 2219 against Felisa A. Afable and the estate of Braulio Santos. They alleged they were the registered owners of a property covered by Original Certificate of Title No. 3199, which they had mortgaged to Macondray and Co. They claimed that on August 29, 1931, Afable induced them to sign a document they believed transferred the mortgage rights to her, but which was actually a deed of sale. Afable then obtained Transfer Certificate of Title No. 20666 in her name. Plaintiffs paid her monthly interest until 1943. In June 1945, they discovered the fraud when trying to redeem the property. Afable later sold the property to Braulio Santos on October 28, 1945, who obtained Transfer Certificate of Title No. 48269. Santos initiated ejectment proceedings against the plaintiffs, which eventually reached the Supreme Court and was dismissed for lack of jurisdiction on June 30, 1953. In their first complaint, plaintiffs sought damages, a declaration that the sale to Santos was null and void, cancellation of the titles, issuance of a new title in their names, and a declaration that Afable’s right to recover the P3,000 had prescribed. The Court of First Instance dismissed this case on October 23, 1953, on the ground of prescription (the four-year period for fraud from discovery in June 1945 had lapsed by August 1953). This dismissal was affirmed by the Supreme Court (G.R. No. L-7651) on February 28, 1955.
On June 1, 1955, plaintiffs filed the present case (Civil Case No. 3638) against the same defendants. In this second complaint, they reiterated their ownership and the mortgage subrogation agreement with Afable. They alleged continuous possession, that the mortgage was never foreclosed, and that Santos was a purchaser in bad faith. They prayed for a declaration that they are still the owners, that Afable’s right to foreclose has prescribed, that Santos was a purchaser in bad faith, and for cancellation of TCT No. 48261 and issuance of a new title in their names. The defendants moved to dismiss on the ground of res adjudicata, which the trial court granted.

ISSUE

Whether the present case is barred by the decision in the first case (res adjudicata).

RULING

Yes, the present case is barred by res adjudicata. The parties are identical. The causes of action are identical: both cases ultimately seek to establish plaintiffs’ ownership and recover the property, which necessarily requires annulling the deeds of sale to Afable and Santos on grounds of fraud. The Supreme Court noted that in the first case, it was held that the action was barred by prescription and that, absent an allegation of bad faith against Santos, his purchase of a registered title could not be revoked. The second complaint, by alleging bad faith on the part of Santos, merely adds a detail to the same fundamental cause of action. The Court ruled that the identity of causes of action is clear, and the decision in the first case constitutes a bar to the present action. The order of dismissal was affirmed.