This case involves an action for unlawful detainer, where the main issue is the rightful possession of a property. The respondents, Franklin and Esmeralda Antonio, filed a complaint against petitioners Pastor Jose Sy and Jesus, seeking recovery of a parcel of land in Bulacan. The respondents claimed ownership through the Sapang Palay Resettlement Project of the National Housing Authority (NHA). They allowed petitioners to use the land for church activities under the condition that they would vacate when needed. Later, a dispute arose when respondents' family required the land, but petitioners refused to vacate, asserting ownership based on alleged donations and a sale transaction.
Parties:
Petitioners: Pastor Jose Sy and Jesus
Respondents: Franklin and Esmeralda Antonio
**Arguments:**
- **Respondents:** Claimed ownership of the land through the NHA's Sapang Palay Resettlement Project. Alleged that they allowed petitioners to use the land under the condition that it would be vacated when needed.
- **Petitioners:** Contended ownership based on documents, including a Kasunduan (agreement), Deed of Donation, and Deed of Absolute Sale, asserting that the land was donated and sold to them. Petitioners also mentioned paying NHA installments until 2010.
**Factual Background:**
- **1983:** Respondents occupied the land, applying as beneficiaries of the Sapang Palay Resettlement Project.
- **1989:** NHA informed respondents of their qualification as housing project beneficiaries.
- **1990:** Respondent Esmeralda Antonio joined JSGCM.
- **1992:** Respondents allowed JSGCM to hold church activities on the land. Documents were exchanged indicating donations and sale of the land to petitioners.
- **2000:** NHA officially awarded the land to respondents, who continued to permit petitioners' occupancy.
- **2012:** Respondents informed petitioners of their need for the land, but petitioners refused to vacate, citing ownership claims.
- **2011:** Petitioners stopped NHA payments due to the dispute.
*Note: The case revolves around conflicting claims of ownership and possession of the land, with respondents asserting their right as NHA beneficiaries and petitioners arguing ownership through alleged donations and sale agreements.*
Lower Court Ruling:
The Metropolitan Trial Court (MTCC) granted the complaint for unlawful detainer filed by respondents on January 24, 2013. MTCC held that respondents, authorized by the National Housing Authority (NHA) to occupy the lot, were entitled to its possession. The Deed of Donation and Deed of Absolute Sale presented by petitioners were deemed void, leading to the judgment in favor of respondents. Petitioners were ordered to vacate the property, remove their structures, and pay attorney's fees.
Appellate Court Ruling:
The Regional Trial Court (RTC) affirmed the MTCC's decision, stating that respondents had a superior right to possession. On further appeal, the Court of Appeals (CA) upheld the lower courts' findings, emphasizing respondents' approved beneficiary status and void status of the deeds in question.
Issues:
The main issue revolves around determining the rightful possession of the subject lot, contested between petitioners and respondents. The key legal questions include the validity of the Deed of Donation and Deed of Absolute Sale, respondents' rights as NHA beneficiaries, and the applicability of relevant laws, such as Republic Act No. 7279, governing housing programs.
**SC Ruling:**
The Supreme Court denied the petition. To establish a complaint for unlawful detainer, the following requisites must be met: (a) initial possession by contract or tolerance of the plaintiff; (b) possession becoming illegal upon notice of termination; (c) defendant's continued possession, depriving the plaintiff of enjoyment; and (d) complaint filed within one year of the last demand to vacate. The Court of Appeals (CA) found these requisites fulfilled by respondents. Respondents, as qualified beneficiaries of the National Housing Authority (NHA), allowed petitioners to occupy a lot under a contract to sell. When petitioners refused to vacate, respondents filed the complaint. The Deed of Donation and Deed of Absolute Sale presented by petitioners did not transfer any rights over the lot and were void due to lack of formalities and violation of RA 6026.
In the present case, notably absent in the Deed of Donation was petitioner Pastor Jose Sy's acceptance of the donation. Neither was there evidence that his acceptance was made in a separate public instrument. For lack of acceptance as required by law, the Deed of Donation is void.41 From the foregoing, it is apparent that even assuming that the subject lot itself was donated, the Deed of Donation was still void for lack of formalities required by law.
More importantly, the Deed of Donation was executed on January 6, 1992, way before respondents had any rights or interests over the subject lot by virtue of the NHA's approval of their application to be a beneficiary. Respondents were informed that their application was approved only on April 27, 2000. Thus, before that time, respondents had no right or interests whatsoever over the subject lot, which they could have transferred to petitioners by donation. Under Article 751 of the Civil Code, "[d]onations cannot comprehend future property. By future property is understood anything which the donor cannot dispose of at the time of the donation." Not being the owners at the time of the execution of the Deed of Donation, respondents could not have donated the subject lot to petitioners.
Under RA 6026, homelots should be sold only to bona fide occupants and/or resettled families determined as such by the then People's Homesite and Housing Corporation (PHHC), now the NHA. Petitioners, however, were not shown to be bona fide occupants and/or resettled families as provided under the law. Moreover, RA 6026 prohibits the resale, assignment, mortgage, lease, or transfer of the homelots by the purchasers within a period of five (5) years after the final payment of the purchase price, except only to the surviving spouse or in default, the legal heirs, and the NHA. Since the Deed of Absolute Sale purports to sell the respondents' rights over the subject lot in violation of the law, it is void and of no legal effect.44
Petitioners argue that even assuming that the Deed of Absolute sale is void, the principle of in pari delicto under Article 1412 (2) of the Civil Code should apply in their favor. According to them, respondents should be barred from recovering possession considering that they were at fault when they sold the subject lot to petitioners despite the prohibition in the law
It has been held, however, that the in pari delicto argument does not apply when it will violate public policy.46
This rule has been applied by the Court in cases47 involving the sale of land obtained under homestead of free patent within the prohibitory period under the Public Land Act, where the issue was whether the grantee or his heirs can recover the property against a third person. In delos Santos v. Roman Catholic Church of Midsayap,48 the heir of a homestead patent grantee was allowed to recover the property which was sold to a third party by the grantee within the prohibitory period. The Court discussed that the non-application of in pari delicto principle was based on the supposition that public policy is considered advanced by allowing the party to sue for relief against the prohibited transaction
The Court upheld the CA's findings, emphasizing the limited scope of ejectment proceedings, focusing on physical possession rather than ownership disputes.
**Ratio Decidendi:** The Court emphasized that in ejectment proceedings, the sole issue is physical possession, not ownership. The Deed of Donation and Deed of Absolute Sale presented by petitioners were void due to lack of formalities and legal violations. RA 6026 prohibits the sale of homelots to non-bona fide occupants, rendering the Deed of Absolute Sale void. The in pari delicto principle doesn't apply when it violates public policy; thus, respondents, recognized as bona fide occupants, could recover possession. The ruling highlights the importance of adhering to legal requirements in property transactions and the preservation of public policy in determining property rights.
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