Belle Corporation,

Petitioner

-versus-

ERLINDA DE LEON-BANKS, et al
Respondents.

Facts

The case originated for rule 45 of the rules of the court filed by the petitioner
seeking to set aside and reverse the decision of Court of Appeals. The disputed
property was a 13.29 hectare parcel of unregistered land belonging to late spouses
Eufronio and Josefa de Leon. The defendants Alfredo Alleje was the husband of Nelia
de Leon-Alleje both whom were the principal stockholders of defendant Appellee
NELFRED Properties Corporation.

On February 1979, deed of absolute sale was executed between the late
spouses and NELFRED wherein the ownership of the property was conveyed to Nelia
De Leon – Alleje for for P 60,000.00. At that time, the disputed property was covered
by Tax Declarations No. 0359 and No. 0361.

On December 1980, the 1979 deed was registered with Regisrty of Deeds. As
time passed by several tax declaration over the disputed property were obtained by
NELFRED in its own name. Belle Corporation, NELFRED, and Spouses Alleje executed
a contract tp sell covering the disputed land for price of Php 53,124,000.00 to be
paid in four installments. When the final installment had been paid, a deed of
absolute sale was executed on 24 June 1998 between Belle Corporation and
NELFRED.

Respondents herein filed a complaint for annulment of deed of sale,

reconveyance of property with prayer for issuance of a writ of preliminary
injunction and damages against spouses Alleje, NELFRED, and Belle Corp. On
February 1998, Spouses Alleje filed a motion to dismiss on the ground that the imlied
trust was already barred by prescription and laches.

Belle Corporation filed a motion to dismiss on the ground that the complaint
stated no cause of action against Belle them. Eventually RTC will dismiss the
complaint against Belle because the complaint stated no cause of action on the
ground that there was no allegation in the complaint that Belle was a purchaser in
bad faith. Respondents filed a motion for reconsideration, following the filling of MR,
respondents also filed a manifestation to admit their amended complaint when they
added the allegations: 1. That the complaint did not affect the registration of the
disputed property 2. The RTC still lifted the dismissal against Belle, at the same time
admistted the amended complaint.

On December 1999, the amended complaint was dismissed by the RTC and
concur with Belle’s contention that the ameded complaint still stated no cause of
action against Belle Corp. Following these Respondents filed an appeal before Court
of Appeals. Court of Appeals granted the appeal and assailed the decision of the RTC.

This resulted to the filing of Motion for Reconsideration by Belle Corp which is
later denied by the CA. Therefore the petitioner Belle Corporation filed an instant
petition before Supreme Court.

Issue

Whether the CA was correct in reversing the order of the RTC which dismissed
respondent’s Amended Complaint on the ground of failure to state a cause of action.

Held

Court Rules in the affirmative. The court cited the elements of cause of action,
these are (1.)right in favor of the plaintiff by whatever means and 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. An act or omission on the part of such defendantin
violation of the right of the plaintiff.

The Court also cited the first paragraph of section 1 , Rule 8 of the rules of
court provides the “every pleading shall contain in methodical and logical form, a
plain, concise and direct statement of the ultimate facts on which the party pleading
relies for his claims or defense.

It is evident from the above allegations in the Amended Complaint that

respondents specifically alleged that they are owners of the subject property being
held in trust by their sister, Nelia Alleje, and that petitioner acted in bad faith when it
bought the property from their sister, through her company, Nelfred, knowing that
herein respondents claim ownership over it.

The court denied the petition. The assailed decision and resolution of Court of
Appeals are affirmed.