G.R. No. L-20497 January 31, 1966
ANTONIA VDA. DE HUERTA, petitioner, vs. DIONISIO H. ACOSTA, ET AL., respondents.

FACTS

The Government acquired the Fabie Estate through expropriation under Republic Act 1162, as amended, to subdivide and resell lots to tenants or occupants. The Land Tenure Administration allocated Lot No. 13 to respondent Dionisio H. Acosta and Lot No. 14 to petitioner Antonia Vda. de Huerta. However, a portion of Lot No. 13 (approximately 30 square meters) had been occupied by Huerta since before the expropriation, where she constructed a house of strong materials, a septic tank, and other permanent improvements while she was a lessee of the former estate owner. Acosta, having obtained Transfer Certificate of Title No. 50570 for Lot 13, filed an action to recover possession and ownership of that disputed portion. Huerta claimed a preferential right to purchase the disputed portion as a bona fide tenant with improvements, pursuant to Republic Act 1162, as amended. The Court of First Instance of Manila dismissed Acosta’s complaint and declared Huerta entitled to purchase the disputed portion. The Court of Appeals reversed this decision, declaring Acosta the owner and ordering Huerta to vacate and remove her improvements. Huerta petitioned for review.

ISSUE

Whether Antonia Vda. de Huerta, as a bona fide tenant who constructed improvements on the disputed portion of Lot 13, has a preferential right to purchase that portion from the Government under Republic Act No. 1162 , as amended, notwithstanding its allocation and titling to Dionisio H. Acosta.

RULING

Yes. The Supreme Court reversed the decision of the Court of Appeals and reinstated the decision of the Court of First Instance of Manila. The Court held that Huerta, as a bona fide tenant who constructed bona fide improvements on the disputed portion of Lot 13 before the Government’s expropriation, has a preferential right to purchase that portion under Section 5 of Republic Act No. 1162 , as amended. This right exists even if adding the disputed area (30 sqm) to her allotted Lot No. 14 (120 sqm) exceeds the 150-square-meter limit generally set in Section 3, because Section 5 expressly recognizes the rights of such tenants “the limitation as to area in section three notwithstanding.” The Court found Huerta’s claim was timely asserted through letters to the Land Tenure Administration and was not estopped by her application for Lot No. 14, which only concerned compliance with ordinances, not a renunciation of her claim to additional land. Acosta never occupied the disputed portion. Therefore, Huerta is entitled to purchase the disputed 30-square-meter portion of Lot 13.