CASE DIGEST: Ceroferr Realty Corporation v. Court of Appeals

 

CEROFERR REALTY CORPORATION, petitioner, vs. COURT OF APPEALS and ERNESTO D. SANTIAGO, respondents

G.R. No. 139539                |              February 5, 2002

FACTS:

On March 16, 1994, plaintiff Ceroferr Realty Corporation filed with the Regional Trial Court a complaint against defendant Ernesto D. Santiago, for damages and injunction, with preliminary injunction. In the complaint, Ceroferr prayed that Santiago and his agents be enjoined from claiming possession and ownership over Lot No. 68 of the Tala Estate Subdivision, Quezon City, covered by TCT No. RT-90200 (334555); that Santiago and his agents be prevented from making use of the vacant lot as a jeepney terminal; that Santiago be ordered to pay Ceroferr P650.00 daily as lost income for the use of the lot until possession is restored to the latter.

In his answer, defendant Santiago alleged that the vacant lot referred to in the complaint was within Lot No. 90 of the Tala Estate Subdivision, covered by his TCT No. RT-78110 (3538); that he was not claiming any portion of Lot No. 68 claimed by Ceroferr; that he had the legal right to fence Lot No. 90 since this belonged to him, and he had a permit for the purpose; that Ceroferr had no color of right over Lot No. 90 and, hence, was not entitled to an injunction to prevent Santiago from exercising acts of ownership thereon; and that the complaint did not state a cause of action.

Because of the competing claims of ownership of the parties over the vacant lot, the eye of the storm centered on the correctness of property boundaries which would necessarily result in an inquiry as to the regularity and validity of the respective titles of the parties.

Thus from the viewpoint of defendant, the case would no longer merely involve a simple case of Collection of damages and injunction which was the main objective of the complaint but a review of the title of defendant vis-à-vis that of plaintiff. At this point, defendant filed a motion to dismiss the complaint premised primarily on his contention that the trial court cannot adjudicate the issue of damages without passing over the conflicting claims of ownership of the parties over the disputed portion.

On May 14, 1996, the trial court dismissed the case for lack of cause of action and lack of jurisdiction. The court held that plaintiff was in effect impugning the title of defendant which could not be done in the case for damages and injunction before it. It concluded that it could not proceed to decide plaintiff’s claim for damages and injunction for lack of jurisdiction because its judgment would depend upon a determination of the validity of defendant’s title and the identity of the land covered by it.

From this ruling, plaintiff appealed to this court insisting that the complaint stated a valid cause of action which was determinable from the face thereof.

ISSUE:

whether Ceroferr’s complaint states a sufficient cause of action

RULING:

The rules of procedure require that the complaint must state a concise statement of the ultimate facts or the essential facts constituting the plaintiff’s cause of action. A fact is essential if it cannot be stricken out without leaving the statement of the cause of action inadequate. A complaint states a cause of action only when it has its three indispensable elements, namely: (1) a right in favor of the plaintiff by whatever means and under whatever law it arises or is created; (2) an obligation on the part of the named defendant to respect or not to violate such right; and (3) an act or omission on the part of such defendant violative of the right of plaintiff or constituting a breach of the obligation of defendant to the plaintiff for which the latter may maintain an action for recovery of damages. If these elements are not extant, the complaint becomes vulnerable to a motion to dismiss on the ground of failure to state a cause of action.

A defendant who moves to dismiss the complaint on the ground of lack of cause of action, as in this case, hypothetically admits all the averments thereof. The test of sufficiency of the facts found in a complaint as constituting a cause of action is whether or not admitting the facts alleged the court can render a valid judgment upon the same in accordance with the prayer thereof. The hypothetical admission extends to the relevant and material facts well pleaded in the complaint and inferences fairly deducible therefrom. Hence, if the allegations in the complaint furnish sufficient basis by which the complaint can be maintained, the same should not be dismissed regardless of the defense that may be assessed by the defendants.

In this case, petitioner Ceroferr’s cause of action has been sufficiently averred in the complaint. If it were admitted that the right of ownership of petitioner Ceroferr to the peaceful use and possession of Lot 68 was violated by respondent Santiago’s act of encroachment and fencing of the same, then petitioner Ceroferr would be entitled to damages.