G.R. No. L-74122. March 15, 1988.
GUILLERMO NACTOR, SPS. ANSELMO & ELENA NACTOR, PRECILIANO NACTOR, JOSE NACTOR & GLORIA NACTOR assisted by her husband MANUEL CLAYTOS, petitioners, vs. INTERMEDIATE APPELLATE COURT, HON. NICOLAS A. GEROCHI, JR., Presiding Judge of the Regional Trial Court of Makati, Branch 139 & SPS. CLARO & MAGDALENA MELCHOR, respondents.

FACTS

In 1962, respondents Spouses Claro and Magdalena Melchor allowed petitioner Guillermo Nactor to build a shanty on their property in Makati without a formal contract or rental, based on an understanding that he would act as a caretaker to prevent squatters while they were abroad. Instead of fulfilling this role, Guillermo Nactor permitted his relatives, the other petitioners, to construct houses on the property without the owners’ knowledge or consent. Upon the Melchors’ return, they discovered the unauthorized occupants and demanded that all petitioners vacate the premises. Following a refusal, the Melchors initiated a complaint which proceeded from the Barangay to the Metropolitan Trial Court (MTC).
The MTC ruled in favor of the Melchors, ordering all petitioners to vacate the lot, pay monthly rental arrears from the complaint’s filing, and cover attorney’s fees. This decision was affirmed in toto by the Regional Trial Court (RTC) and subsequently by the Intermediate Appellate Court (IAC). The petitioners’ motion for reconsideration at the RTC was denied for being filed after the decision had become final and executory. Petitioners then elevated the case to the Supreme Court via a petition for review on certiorari.

ISSUE

Whether the courts correctly ruled that petitioners must vacate the subject property and pay rentals, notwithstanding their claims regarding the propriety of the action (unlawful detainer vs. forcible entry) and their alleged coverage under urban land reform laws.

RULING

The Supreme Court affirmed the assailed decision, ruling that petitioners have no right to remain on the property. The legal logic is clear and multi-faceted. First, the core factual finding, sustained by all lower courts, is that Guillermo Nactor’s possession was merely by tolerance of the lawful owners. Possession by mere tolerance does not ripen into a lawful possession that can be set up against the owner. Under Articles 537 and 1119 of the Civil Code, acts executed by mere tolerance of the owner do not affect the owner’s juridical possession and cannot serve as a basis for a claim of right. Consequently, Guillermo Nactor, having no independent right, could not confer any right upon his co-petitioners who occupied the land under his auspices.
Second, the Court dismissed the procedural objection that the action should have been for forcible entry against some petitioners, not unlawful detainer. It held that the allegations in the complaint and the evidence presented determine the relief granted. The essence of the action was to recover possession from persons occupying the land without right, a relief fully warranted under the circumstances. The mislabeling of the action is not a material defect where the substantive facts support the remedy awarded.
Finally, the Court rejected the claim of protection under Presidential Decree No. 1517 (Urban Land Reform), as certified official documents proved the subject property was outside the declared Urban Land Reform Zone. Therefore, petitioners’ occupancy, being merely tolerated and without any legal basis, must cease. The owners’ right to repossess their property, registered under the Torrens system, is paramount. The decision was declared immediately executory.