G.R. No.

194560               June 11, 2014

NESTOR T. GADRINAB, Petitioner, 
vs.
NORAT. SALAMANCA, ANTONIO TALAO AND ELENA LOPEZ, Respondents.

DECISION

LEONEN, J.:

A judgment on compromise agreement is a judgment on the merits. It has the effect of res
judicata, and is immediately final and executory unless set aside because of falsity or vices of
consent. The doctrine of immutability of judgments bars courts from modifying decisions that
have already attained finality, even if the purpose of the modification is to correct errors of fact or
law.

This Rule 45 petlt10n seeks the review of the Court of Appeals' Decision  dated July 22, 2010
1

and its resolution dated November 19, 2010.

2

The Court of Appeals dismissed petitioner’s appeal and affirmed the Regional Trial Court’s
decision granting respondent Salamanca’s motion for physical partition pending the execution of
a judgment on compromise agreement between the parties.

Respondents, together with Adoracion Gadrinab and Arsenia Talao, are siblings and heirs of the
late Spouses Talao, Nicolas and Aurelia.  The Spouses Talao died intestate, leaving a parcel of
3

land in Sta. Ana, Manila. 4

The five Talao children divided the property among themselves through an extrajudicial
settlement.  Subsequently, Arsenia Talao waived her share over the property in favor of her
5

siblings.
6

Respondent Salamanca filed a complaint for partition against her siblings, Antonio, Elena
(deceased, now represented by her husband, Jose Lopez), and Adoracion (deceased, now
represented by heirs, petitioner Nestor and Francisco Gadrinab) before the Regional Trial Court
of Manila. 7

All parties claimed their respective shares in the property.  They also claimed shares in the
8

rentals collected from one of the units of a duplex apartment on the property.  The total amount of
9

rental collection in the possession of Jose Lopez was 528,623.00.  The amount, according to
10

Jose’s counsel, was ready for distribution. 11

Upon being referred to mediation, the parties entered into a compromise agreement and
stipulated the following:

1) That the subject property (land with all the improvements) situated at 2370 Nacar
Street, San Andres, Sta. Ana, Manila will be subject for sale and the amount will be
divided among the four (plaintiff and defendants);

2) That the subject property will be appraised by independent appraiser and the
appraised value will be divided into four. Mr. Antonio Talao will pay in advance the share
of Francisco Gadrinab immediately after the report of the said appraisal;

3) That Cuervo Appraiser will be the one who appraised [sic] the property on or before
March 21, 2003 and any appraised value shall binding [sic] on all parties;
 4) That the rental collection in its total amount of Five Hundred Twenty Eight Thousand
and Six Hundred Twenty Three Pesos (528,623.00) and the uncollected amount up to
February 2003 once collected will be divided among the parties;

5) That the amount of 528,623.00 divided by four be distributed among the parties will be
given to all parties on or before March 12, 2003 by Mr. Antonio Talao;

6) That upon payment of the appraised value to Francisco Gadrinab, Mr. Nestor
Gadrinab is given forty-five (45) days within which to leave the premises in question;

7) That the parties agreed to waive all their claims and counter-claims arising from this
case; and

8) That the parties agreed to request this Honorable Court that a decision be issued base
[sic] on this Compromise Agreement or this Compromise Agreement be submitted before
this Honorable Court for approval. 12

On April 10, 2003, the Regional Trial Court approved the compromise agreement.  Based on the
13

entry of judgment, the case became final and executory on April 10, 2003. 14

Nestor Gadrinab filed a motion for execution of the compromise agreement.  He demanded his
15

one-fourth share in the accumulated rentals.  During the hearing on the motion for execution, the
16

parties agreed that the rentals shall be divided only into three since Nestor had already been
occupying one of the duplex units.  The parties also agreed that Antonio Talao would shoulder
17

Nestor’s share, equivalent to one-fourth of the rental amount. 18

Pursuant to the compromise agreement, Cuervo Appraiser appraised the property.  Unsatisfied19

with the appraisal, Antonio Talao moved for the property’s reappraisal.  This was denied by the
20

Regional Trial Court.21

The portion of the duplex that Nestor refused to vacate,  remained unsold.
22 23

Because of the attitude of her co-heirs, respondent Salamanca moved for the physical partition of
the property before the Regional Trial Court of Manila.  She prayed for the physical partition of
24

the property instead of having it sold.25

Nestor and Francisco Gadrinab opposed the motion.  They contended that the judgment on the
26

compromise agreement had already become final and executory and had the effect of res
judicata.  Antonio Talao and Jose Lopez did not object to the motion for physical partition.
27 28

On December 29, 2005, the Regional Trial Court of Manila granted the motion for physical
partition.
29

Nestor and Francisco Gadrinab appealed to the Court of Appeals. They assailed the grant of
Salamanca’s motion for physical partition after the issuance of the judgment on compromise
agreement. 30

In a decision promulgated on July 22, 2010,  the Court of Appeals dismissed the appeal. The
31

Court of Appeals ruled that the exception to the immutability of judgments, that is, "whenever
circumstances transpire after the finality of the decision rendering its execution unjust and
inequitable,"  applies in this case. The Court of Appeals specifically noted that the "parties’
32

seemingly endless disagreements on matters involving the disposition of the subject

property"  were such circumstances that rendered the compromise agreement’s execution unjust
33

and inequitable. The Court of Appeals agreed with the Regional Trial Court’s ruling that "the
proposed physical partition of the subject lot . . . is just another way of enforcing the [c]ourt’s
decision and will not in anyway vary the parties’ agreement nor affect their right over the
property." 34

On November 19, 2010, the Court of Appeals denied petitioner’s motion for reconsideration. 35

Hence, this petition was filed.

Petitioner argued that the Court of Appeals erred in affirming the Regional Trial Court’s order
granting respondent Salamanca’s motion for physical partition.  A judgment on the compromise
36

agreement had already been rendered and had attained finality.  Petitioner also argued that the
37

Court of Appeals failed to consider the following terms of the compromise agreement:

2. That the subject property will be appraised by independent appraiser and the
appraised value will be divided into four (4). Mr. Antonio Talao will pay in advance the
share of Francisco Gadrinab immediately after the report of the said appraisal;

....

4. That the rental collection in its total amount of FIVE HUNDRED TWENTY EIGHT
THOUSAND SIX HUNDRED TWENTY THREE PESOS (Php528,623.00) and the
uncollected amount up to February 2003 once collected [sic] will be divided among the
parties;

5. That the amount of FIVEHUNDRED TWENTY EIGHT THOUSAND SIX HUNDRED

TWENTY THREE PESOS Php528,623.00 divided by four (4) among the parties will be
given to all parties on or [sic] March 12, 2003 by Mr. Antonio Talao at Greenbelt, Mc
Donald at 9:00 o’clock in the morning;

6. That upon payment of the appraised value to Mr. Francisco Gadrinab, Mr. Nestor
Gadrinab is given forty five (45) days within which to leave the premises in
question[.]  (Emphasis in the original)
38

Petitioner alleged that the judgment on the compromise agreement had already been partially
complied with, as respondent Salamanca had already been paid her share in the accrued
rentals.  On the other hand, petitioner still had not been paid his share,  prompting him to file the
39 40

motion for execution. 41

Petitioner pointed out that there was no agreement that he must vacate the property before it
could be sold. 42

Moreover, petitioner argued that the Court of Appeals’ decision violated his right to due
process.  According to him, had there been a full-blown trial on the action for partition, he would
43

have been able to present evidence of exclusive possession of half of the property. 44

In their separate comments, respondents Salamanca and Talao argued that this case fell under
the exception of the rule on immutability of judgments.  The non-compliance of some of the
45

parties with the compromise agreement constituted an event that "[makes] it difficult if not totally
impossible to enforce the compromise agreement." 46

Respondents Salamanca and Talao also argued that the physical partition of the property would
not prejudice the parties.  The order granting the motion for physical partition was a mere
47

enforcement of the compromise agreement, which entitled the parties to their shares in the
proceeds of the sale.  Respondent Salamanca pointed out that the grant of the motion for
48

physical partition would still be consistent with the intent of the compromise agreement since it
would result in the proceeds being divided equally among the parties.  "The Order granting the
49
physical partition was within the inherent power and authority of the court having jurisdiction to
render a particular judgment to enforce it and to exercise equitable control over such
enforcement." 50

Moreover, petitioner’s refusal to vacate the property prevented it from being sold so that the
proceeds could already be distributed among the parties. 51

On the violation of due process, respondents Salamanca and Talao argued that it was only
before this court that this issue was raised.

The issue in this case is whether the Court of Appeals erred in affirming the Regional Trial
Court’s decision allowing the physical partition of the property despite finality of a previous
judgment on compromise agreement involving the division of the same property.

The petition is meritorious.

The Court of Appeals erred in

affirming the Regional Trial
Court’s decision allowing the
physical partition of the property

Respondent Salamanca filed two actions for physical partition. The two parties settled the first
action through a judicial compromise agreement. The same respondent filed the second action
after she had determined that her co-heirs were not being cooperative in complying with the
compromise agreement.

In a compromise agreement, the parties freely enter into stipulations. "[A] judgment based on a
compromise agreement is a judgment on the merits"  of the case. It has the effect of res judicata.
52

These principles are impressed both in our law and jurisprudence.

Thus, Article 2037 of the Civil Code provides:

Article 2037. A compromise has upon the parties the effect and authority of res judicata; but
there shall be no execution except in compliance with a judicial compromise.

In Spouses Romero v. Tan,  this court said:

53

It is well settled that a judicial compromise has the effect of res judicata and is immediately
executory and not appealable unless set aside [by mistake, fraud, violence, intimidation, undue
influence, or falsity of documents that vitiated the compromise agreement]. 54

There is res judicata when the following concur:

1. Previous final judgment;

2. By a court having jurisdiction over the parties and the subject matter;

3. On the merits of the case;

4. Between identical parties, on the same subject matter, and cause of action 55

There are two rules that embody the principle of res judicata. The first rule refers to "bar by prior
judgment,"  which means that actions on the same claim or cause of action cannot be
56

relitigated.  This rule is embodied in Rule 39, Section 47, paragraph (b) of the Rules of Court,
57

which provides:
Section 47. Effect of judgments or final orders. — The effect of a judgment or final order
rendered by a court of the Philippines, having jurisdiction to pronounce the judgment or final
order, may be as follows:

(b) In other cases, the judgment or final order is, with respect to the matter directly adjudged or
as to any other matter that could have been raised in relation thereto, conclusive between the
parties and their successors in interest by title subsequent to the commencement of the action or
special proceeding, litigating for the same thing and under the same title and in the same
capacity[.]

The second rule refers to "conclusiveness of judgment."  This means that facts already tried and
58

determined in another action involving a different claim or cause of action cannot anymore be
relitigated.  This rule is embodied in Rule 39, Section 47, paragraph (c) of the Rules of Court,
59

which provides:

Section 47. Effect of judgments or final orders. — The effect of a judgment or final order
rendered by a court of the Philippines, having jurisdiction to pronounce the judgment or final
order, may be as follows:

....

(c) In any other litigation between the same parties or their successors in interest, that only is
deemed to have been adjudged in a former judgment or final order which appears upon its face
to have been so adjudged, or which was actually and necessarily included therein or necessary
thereto. (49a)

This case involves "bar by prior judgment." Respondents cannot file another action for partition
after final judgment on compromise had already been rendered in a previous action for partition
involving the same parties and property.

This court explained in FGU Insurance Corporation v. Regional Trial Court  the doctrine of finality
60

of judgment:

Under the doctrine of finality of judgment or immutability of judgment, a decision that has
acquired finality becomes immutable and unalterable, and may no longer be modified in any
respect, even if the modification is meant to correct erroneous conclusions of fact and law, and
whether it be made by the court that rendered it or by the Highest Court of the land. Any act
which violates this principle must immediately be struck down. 61

This doctrine admits a few exceptions, usually applied to serve substantial justice:

1. "The correction of clerical errors;

2. the so-called nunc pro tunc entries which cause no prejudice to any party;

3. void judgments; and

4. whenever circumstances transpire after the finality of the decision rendering its
execution unjust and inequitable." 62

Doctrines on bar by prior judgment and immutability of judgment apply whether judgment is
rendered after a full-blown trial or after the parties voluntarily execute a compromise agreement
duly approved by the court.
Because a judicial compromise agreement is in the nature of both an agreement between the
parties and a judgment on the merits, it is covered by the Civil Code provisions on contracts. It
can be avoided on grounds that may avoid an ordinary contract, e.g., it is not in accord with the
law;  lack of consent by a party; and existence of fraud or duress. Further, the pertinent Civil
63

Code provisions on compromise agreements provide:

Article 2038. A compromise in which there is mistake, fraud, violence, intimidation, undue
influence, or falsity of documents is subject to the provisions of Article 1330 of this Code.

Article 1330. A contract where consent is given through mistake, violence, intimidation, undue
influence, or fraud is voidable.

Therefore, courts cannot entertain actions involving the same cause of action, parties, and
subject matter without violating the doctrines on bar by prior judgment and immutability of
judgments, unless there is evidence that the agreement was void, obtained through fraud,
mistake or any vice of consent, or would disrupt substantial justice.

In this case, there was no issue as to the fact that the parties freely entered into the compromise
agreement. There was also no dispute about the clarity of its terms. Some of the parties simply
do not wish to abide by the compromise agreement’s terms.

This court does not see how substantial justice will be served by disturbing a previous final
judgment on compromise when failure of its execution was caused by the parties themselves.

Likewise, respondents’ argument that a supervening event, i.e. disagreement among the parties,
was present to justify disturbance of the final judgment on compromise fails to persuade. A
supervening event may justify the disturbance of a final judgment on compromise if it "brought
about a material change in [the] situation"  between the parties. The material change
64

contemplated must render the execution of the final judgment unjust and inequitable. Otherwise,
a party to the compromise agreement has a "right to have the compromise agreement executed,
according to its terms." 65

The subsequent disagreement among the parties did not cause any material change in the
situation or in the relations among the parties. The situation and relations among the parties
remained the same as the situation and their relations prior to the compromise agreement. They
remained co-owners of the property, which they desired to partition.

Moreover, the parties voluntarily agreed to the compromise agreement, which was already
stamped with judicial approval. The agreement’s execution would bring about the effects desired
by all parties and the most just and equitable situation for all. On the other hand, the judgment
granting the second action for partition filed by respondent Salamanca was obtained with
opposition.

Judges "have the ministerial and mandatory duty to implement and enforce [a compromise
agreement]."  Absent appeal or motion to set aside the judgment, courts cannot modify, impose
66

terms different from the terms of a compromise agreement, or set aside the compromises and
reciprocal concessions made in good faith by the parties without gravely abusing their
discretion.67

"[They cannot] relieve parties from [their] obligations . . . simply because [the agreements
are] . . . unwise." Further, "[t]he mere fact that the Compromise Agreement favors one party
68

does not render it invalid."  Courts do not have power to "alter contracts in order to save [one
69

party]

from [the effects of] adverse stipulations. . . ."70

Respondents have remedies if
parties to the compromise
agreement refuse to abide by its
terms

The issue in this case involves the non-compliance of some of the parties with the terms of the
compromise agreement.  The law affords complying parties with remedies in case one of the
1âwphi1

parties to an agreement fails to abide by its terms.

A party may file a motion for execution of judgment. Execution is a matter of right on final
judgments. Section 1, Rule 39 of the Rules of Court provides:

Section 1. Execution upon judgments or final orders. — Execution shall issue as a matter of right,
on motion, upon a judgment or order that disposes of the action or proceeding upon the
expiration of the period to appeal therefrom if no appeal has been duly perfected. (1a)

If the appeal has been duly perfected and finally resolved, the execution may forthwith be applied
for in the court of origin, on motion of the judgment obligee, submitting therewith certified true
copies of the judgment or judgments or final order or orders sought to be enforced and of the
entry thereof, with notice to the adverse party.

The appellate court may, on motion in the same case, when the interest of justice so requires,
direct the court of origin to issue the writ of execution. (n)

If a party refuses to comply with the terms of the judgment or resists the enforcement of a lawful
writ issued, an action for indirect contempt may be filed in accordance with Rule 71 of the Rules
of Court:

Section 3. Indirect contempt to be punished after charge and hearing. — After a charge in writing
has been filed, and an opportunity given to the respondent to comment thereon within such
period as may be fixed by the court and to be heard by himself or counsel, a person guilty of any
of the following acts may be punished for indirect contempt;

....

(b) Disobedience of or resistance to a lawful writ, process, order, or judgment of a court,

including the act of a person who, after being dispossessed or ejected from any real property by
the judgment or process of any court of competent jurisdiction, enters or attempts or induces
another to enter into or upon such real property, for the purpose of executing acts of ownership
or possession, or in any manner disturbs the possession given to the person adjudged to be
entitled thereto[.]

Since a judgment on compromise agreement is effectively a judgment on the case, proper

remedies against ordinary judgments may be used against judgments on a compromise
agreement. Provided these are availed on time and the appropriate grounds exist, remedies may
include the following: a) motion for reconsideration; b) motion for new trial; c) appeal; d) petition
for relief from judgment; e) petition for certiorari; and f) petition for annulment of judgment.
71

Respondent Salamanca knew that the only reason for the failed compromise agreement was the
non-compliance with the agreement’s terms of some of her co-heirs. Particularly, it was
stipulated that petitioner’s removal from the property was conditioned upon payment of an
amount equivalent to his share. Respondent Talao refused to abide by his own undertaking to
shoulder respondent Salamanca’s share. He also refused to acknowledge the appraisal of the
appraiser appointed in the compromise agreement. This refusal caused the failure of the
compromise agreement.
Instead of availing herself of the proper remedies so the compromise could be enforced and the
partition could be effected, respondent Salamanca chose to move again for the partition of the
property and set aside a valid and final judgment on compromise. This court cannot allow such
motion to prosper without going against law and established jurisprudence on judgments.

WHEREFORE, the Court of Appeals’ decision is REVERSED and SET ASIDE. The judgment on
the compromise agreement is REINSTATED.

SO ORDERED.

MARVIC MARIO VICTOR F. LEONEN

Associate Justice

WE CONCUR:

PRESBITERO J. VELASCO, JR.

Associate Justice
Chairperson

DIOSDADO M. PERALTA MARTIN S. VILLARAMA, JR.*

Associate Justice Associate Justice

JOSE CATRAL MENDOZA

Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Court's Division.

PRESBITERO J. VELASCO, JR.

Associate Justice
Chairperson, Third Division

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's Attestation,
I certify that the conclusions in the above Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Court's Division.

MARIA LOURDES P. A. SERENO

Chief Justice

Footnotes

* Villarama, Jr., J, designated as Acting Member per Special Order No. 1691 dated May
22, 2014 in view of the vacancy in the Third Division.

 Rollo, p. 31-42. This decision was penned by Associate Justice Noel G. Tijam, with
1

Associate Justices Marfone Gonzales-Sison and Danton Q. Bueser concurring.

 Id. at 43-45. This resolution was penned by Associate Justice Noel G. Tijam, with
2

Associate Justices Marlene Gonzales-Sison and Danton Q. Bueser concurring.

3
 Id. at 32.

4
 Id.

5
 Id.

6
 Id.

7
 Id.

8
 Id.

9
 Id. at 33.

10
 Id.

11
 Id.

 Id. at 33–34. The text of the compromise agreement reproduced above is based on the
12

Court of Appeals’ decision.

13
 Id. at 34.

14
 Id.

15
 Id.

16
 Id.

17
 Id.

18
 Id. at 34–35.

19
 Id. at 35.

20
 Id.

21
 Id.

22
 Id.

23
 Id.

24
 Id.

25
 Id.

26
 Id.

27
 Id. at 35–36.
  Id. at 36.
28

 Id. at 37.
29

 Id. at 37–38.
30

 Id. at 31–42.
31

 Id. at 39.
32

 Id.
33

 Id. at 40.
34

 Id. at 43–45.
35

 Id. at 15–16.
36

 Id.
37

 Id. at 19–20.
38

 Id.
39

 Id. at 20.
40

 Id.
41

 Id.
42

 Id. at 23.
43

 Id. at 23–24.
44

 Id. at 72 and 109.

45

 Id. at 75.
46

 Id. at 76 and 108.

47

 Id. at 108.
48

 Id. at 75.
49

 Id. at 76.
50

 Id. at 109.
51

 Spouses Romero v. Tan, 468 Phil. 224, 240 (2004) [Per J. Quisumbing, Second
52

Division].

 468 Phil. 224 (2004) [Per J. Quisumbing, Second Division].

53
  Id. at 240; See also Aromin v. Floresca, 528 Phil. 1165, 1186 (2006) [Per J. Callejo, Sr.,
54

First Division].

 See Heirs of Enrique Diaz v. Virata,529 Phil. 799, 823-824 (2006) [Per J. Chico-
55

Nazario, First Division].

 See also Facura v. Court of Appeals, G.R. No. 166495, February 16, 2011, 643 SCRA
56

427, 458–460 [Per J. Mendoza, Second Division].

 See also Facura v. Court of Appeals, G.R. No. 166495, February 16, 2011, 643 SCRA
57

427, 458–460 [Per J. Mendoza, Second Division].

 See also Facura v. Court of Appeals, G.R. No. 166495, February 16, 2011, 643 SCRA
58

427, 458–460 [Per J. Mendoza, Second Division].

 See also Facura v. Court of Appeals, G.R. No. 166495, February 16, 2011, 643 SCRA
59

427, 458–460 [Per J. Mendoza, Second Division].

 G.R. No. 161282, February 23, 2011, 644 SCRA 50 [Per J. Mendoza, Second Division].
60

 Id. at 56.
61

 Id.
62

 See Guiang v. Kintanar, 193 Phil. 251, 288–289 (1981) [Per J. Barredo, Second
63

Division].

 See Cachopero v. Celestial, G.R. No. 146754, March 21, 2012, 668 SCRA 619, 635
64

[Per J. Leonardo-De Castro, First Division].

 Cachopero v. Celestial, G.R. No. 146754, March 21, 2012, 668 SCRA 619, 635 [Per J.
65

Leonardo-De Castro, First Division].

 Id. at 632, citing Philippine National Oil Company-Energy Development Corporation

66

(PNOC-EDC) v. Abella, 489 Phil. 515 (2005) [Per J. Chico-Nazario, Second Division].

 See Viesca v. Gilinsky, 553 Phil. 498, 522–523 (2007) [Per J. Chico-Nazario, Third
67

Division]; Domingo Realty v. Court of Appeals, 542 Phil. 39, 65–66 (2007) [Per J.
Velasco, Jr., Second Division]; Aromin v. Floresca, 528 Phil. 1165, 1190 (2006) [Per J.
Callejo, Sr., First Division].

 Cachopero v. Celestial, G.R. No. 146754, March 21, 2012, 668 SCRA 619, 632 [Per J.
68

Leonardo-De Castro, First Division], citing Air Transportation Office v. Gopuco, Jr., 501
Phil. 228, 239 (2005) [Per J. Chico-Nazario, Second Division].

 Domingo Realty v. Court of Appeals, 542 Phil. 39, 66 (2007) [Per J. Velasco, Jr.,
69

Second Division].

 Id.
70

 See also Domingo Realty v. Court of Appeals, 542 Phil. 39, 55-56 (2007) [Per J.
71

Velasco, Jr., Second Division].

Indispensable parties

G.R. No. 169157               November 14, 2011

SPOUSES BENJAMIN and NORMA GARCIA, Petitioner, 

vs.
ESTER GARCIA, AMADO GARCIA, ADELA GARCIA, ROSA GARCIA and DAVID
GARCIA, Respondents.

DECISION

PERALTA, J.:

For review is the Court of Appeals (CA) Decision1 dated May 12, 2005 and Resolution2 dated
August 3, 2005 in CA-G.R. SP No. 41556. The assailed decision dismissed the Amended
Petition for Certiorari with Preliminary Injunction and/or Temporary Restraining Order (TRO)3 filed
by petitioners, Spouses Benjamin and Norma Garcia, questioning the Regional Trial Court
(RTC)4 Orders5 dated April 24, 19966 and July 9, 19967 denying their Urgent Motion to Quash
Order of Execution8 and Motion for Reconsideration,9 respectively, in Civil Case No. Q-36147;
while the assailed resolution denied petitioners’ motion for reconsideration.

The facts of the case follow:

Emilio Garcia (Emilio) and Eleuteria Pineda Garcia (Eleuteria) had nine (9) children, namely:
Jerameal, Jose, Rita Garcia-Shipley (Rita), respondents Ester, Amado, Adela, Rosa, David and
petitioner Benjamin, all surnamed Garcia. Eleuteria died in 1927. Emilio, thereafter, married
Monica Cruz (Monica), with whom he had eight (8) children, namely: Irma, Imelda, Rogelio,
Emilio, Maurita, Felixberto, Violeta and Rosalinda.10

On October 26, 1962, Emilio died intestate, survived by his wife Monica Cruz and his children of
the first and second marriage. He left, among others, a 1,564-square-meter (sq m) lot (hereafter
referred to as "subject property") located in San Francisco Del Monte, Quezon City covered by
Transfer Certificate of Title (TCT) No. 18550 registered in the name of Emilio married to
Eleuteria.11

On June 28, 1965, Emilio’s children of the first marriage executed a General Power of Attorney
(GPA) in favor of Rita. On July 29, 1971, Benjamin and Rita executed a Deed of Extrajudicial
Settlement of Estate, declaring themselves as the sole and only heirs of Emilio and Eleuteria,
and adjudicating unto themselves the subject property, 1,000 sq m of which to Rita and the
remaining 564 sq m to Benjamin.12 Pursuant to said Deed, TCT No. 18550 was cancelled and
TCT No. 170385 was issued in the name of Rita and Benjamin. The latter title was further
cancelled and two (2) new TCTs were issued, namely, TCT No. 171639 in the name of Benjamin
corresponding to his share of the subject property and TCT No. 171640 in the name of Rita for
her share.13

On July 25, 1973, Emilio’s daughters (Irma and Imelda) of his second marriage filed a complaint
against Rita and Benjamin for the annulment of title, docketed as Civil Case No. Q-17933. In
addition to the annulment and cancellation of the TCT, Irma and Imelda prayed that the property
covered thereby be partitioned in accordance with the law on intestate succession.14 The parties,
thereafter, entered into a Compromise Agreement15 which was approved by the court on August
29, 1974.16 The subject property was supposed to be partitioned among the siblings of the first
and second marriage. Pursuant to the said agreement as approved by the court, the children of
the first marriage were supposed to receive a total area of 1,091.90 sq m, while the children of
the second marriage, including the surviving spouse Monica, were supposed to receive a total
area of 472.10 sq m.17 It was further agreed upon by the parties that the shares of Monica and
her children were to be taken from Rita’s 1,000-sq-m portion of the subject property.18

However, instead of executing the judgment based on the compromise agreement, Rita divided
her 1,000-sq-m property – 555 sq m for herself and 445 sq m for Monica and her children.
Consequently, TCT No. 171640 was cancelled and TCT No. 207117 was issued to Monica and
her children, while TCT No. 207116 to Rita.19

On April 17, 1975, a permanent service road was constructed on Rita’s property. Consequently,
a Deed of Exchange was executed between Rita on the one hand, and Monica and her children,
on the other. This resulted in the issuance of TCT No. 207210 for 445 sq m in the name of Rita
and TCT No. 207211 for 555 sq m to Monica and her children.20 On August 22, 1979, Rita sold
her property covered by TCT No. 207210 to petitioner Norma Dimalanta Garcia (Norma)
resulting in the registration and issuance of TCT No. 278765 in the name of Norma married to
Benjamin.21

Respondents Ester, Adela, Amado, Rosa and David filed a complaint for reconveyance, which
was later amended22on October 26, 1982, of the parcel of land originally covered by TCT No.
18550, against Rita, Benjamin, and Monica and her children. The case was docketed as Civil
Case No. Q-36147. They alleged that Benjamin and Rita were able to adjudicate between
themselves the subject property by claiming to be the only heirs of Emilio, when in fact they were
not. They, thus, demanded for their shares in the subject property since, as children of the first
marriage (which includes Benjamin and Rita), they are entitled to a total area of 1,091 sq m,
pursuant to the August 28, 1974 Compromise Agreement.

On March 15, 1989, the RTC rendered a Decision23 in favor of respondents, the dispositive
portion of which reads:

WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiff[s] and
against the defendants as follows:

1. Defendants are ordered to convey to plaintiffs the portions corresponding to their

shares in the property in question based upon the Compromise Agreement dated August
28, 1974, computed in accordance with the law on intestate succession; and

2. Defendants are ordered to pay attorney[’s] fees amounting to ₱5,000.00. Costs against
the defendants.

SO ORDERED.24

The court noted that Benjamin and Rita’s basis in adjudicating between themselves the subject
property was the GPA allegedly executed by respondents in favor of Rita. However, the court
held that the law requires a special power of attorney, not a GPA, in repudiating an inheritance. It
follows that the deed of extrajudicial settlement executed by Benjamin and Rita is defective for
having knowingly and willingly excluded compulsory heirs. The partition earlier made by
Benjamin and Rita, and later by Monica and her children based on the compromise agreement,
is incomplete. Consequently, there is a need to complete the distribution to the omitted heirs.25

On appeal, except for the deletion of the award of attorney’s fees, the CA affirmed26 the RTC
decision. When elevated before the Court, we denied the petition and, consequently, affirmed the
CA decision. The decision attained finality.27 The corresponding Writ of Execution28 was issued
thereafter.

Meanwhile on August 30, 1993, Norma filed a Petition for Quieting of Title29 against Amado with
the RTC. The case was docketed as Civil Case No. Q-93-17396. Norma alleged that she is the
owner of a portion of the property being claimed by Amado and his siblings in a reconveyance
case in which she was not made a party. She added that she bought the property from
Rita.30 The case, however, was dismissed on motion of Amado on the ground of res judicata
considering that the title to the property claimed by Norma emanated from TCT No. 18550 which
was already declared to have been fraudulently partitioned by Rita and Benjamin.31

On motion of respondents, an Alias Writ of Execution32 in the reconveyance case was issued, the
pertinent portion of which reads:

NOW THEREFORE, the defendants are hereby ordered to convey to plaintiffs the portions
corresponding their shares in the property in question based upon the Compromise Agreement
dated August 28, 1974, computed in accordance with the law on intestate succession and to
show proof of compliance with this writ within sixty (60) days from receipt. Likewise, the Branch
Deputy Sheriff, Mr. Cesar M. Torio, is ordered to return this writ into [this] court within sixty (60)
days from date with your proceedings endorsed thereon.33

Petitioners, however, opposed the writ on the ground that the compromise agreement referred to
in the decision did not cover their properties.34 In an Urgent Motion to Quash Order of
Execution,35 petitioners insisted that in including the properties of Benjamin and Norma in the
order of execution, the judge amended the judgment sought to be executed.36 They likewise
pointed out that Norma was never impleaded in the reconveyance case.

In an Order37 dated April 24, 1996, the RTC denied the motion to quash. The RTC explained that
the issue of Norma’s non-inclusion in the reconveyance case had been finally settled when her
case had been dismissed for quieting of title precisely because of the reconveyance case that
had become final and executory. Petitioners’ motion for reconsideration38 was likewise denied in
an Order39 dated July 9, 1996.

In a special civil action for certiorari, the CA found no grave abuse of discretion on the part of the
RTC in issuing the above orders. The CA pointed out that the assailed order of execution did not
amend the March 15, 1989 decision sought to be executed.40 It explained that the order of
execution merely clarified the dispositive portion of the decision with reference to the other
portions thereof.41 It found that the parcels of land in the name of petitioners form part of the
decision as they originated from the mother title TCT No. 18550 against which the execution may
be had in favor of respondents.42 As to the non-inclusion of Norma as indispensable party in the
reconveyance case, the appellate court applied the rule on estoppel by laches, considering that
Norma was very much aware of the existence of the litigations involving the subject
property.43 Finally, on petitioners’ claim of the indefeasibility of the Torrens title, the CA stressed
that mere issuance of the certificate of title does not foreclose the possibility that the property
may be under co-ownership with persons not named in the title.44

Aggrieved, petitioners filed this petition assailing in general the denial of their urgent motion to
quash writ of execution.

The petition is without merit.

The existence of the court’s decision in Civil Case No. Q-36147 for reconveyance and the August
28, 1974 Compromise Agreement, is undisputed. In said decision, the court ordered Benjamin,
Rita, Monica and her children, to convey to respondents the portions corresponding to their
shares in the subject property based on the compromise agreement. In the compromise
agreement, the subject property was divided as follows: 1,091 sq m as the total shares of the
children of the first marriage and 472 sq m for Monica and her children. Pursuant to the final and
executory decision above, the RTC issued a Writ of Execution and eventually the assailed Alias
Writ of Execution.
Petitioners, however, opposed the implementation of the writ of execution on two grounds: (1)
the compromise agreement did not include the portion of the subject property in the name of
Benjamin, thus, should not be considered part of the property ordered by the court to be
reconveyed to respondents; and (2) the writ of execution could not cover the portion of the
subject property in the name of Norma, since she was not impleaded in the reconveyance case,
and as such, is not bound by the decision sought to be executed.

We do not agree with petitioners.

To determine the propriety of petitioners’ claims, it is necessary to look into the terms of the
compromise agreement and the conclusions of the court in the decision sought to be executed.

First, the compromise agreement. It must be recalled that the compromise agreement came
about because of the case for annulment of title instituted by Monica and her children against
Benjamin and Rita. At the time of the institution of the annulment case, the subject property had
been divided between Benjamin and Rita, wherein they were issued their respective titles, TCT
No. 171639 in the name of Benjamin covering 564 sq m and TCT No. 171640 in the name of Rita
covering 1,000 sq m. The parties later entered into a compromise agreement recognizing the
rights of Monica and her children to the subject property as heirs of Emilio being the surviving
wife and children of the second marriage. To facilitate the delivery of their45 shares, it was stated
in the compromise agreement that their shares shall be taken from Rita’s portion covered by TCT
No. 171640.

Respondents were not parties to the annulment case or to the compromise agreement but their
rights to the subject property as heirs of Emilio were recognized. Of the 1,564 sq m property,
1,091 sq m was agreed upon as the total shares of the children of the first marriage which
include Rita, Benjamin and respondents, and 472 sq m for Monica and her children. From Rita’s
1,000 sq m share, 47246 sq m was supposed to be given to Monica and her children. After
deducting said area, 528 sq m remained for the children of the first marriage who are entitled to
1,091 sq m. Although it was not specifically stated in the compromise agreement, obviously, the
shares of the children of the first marriage should be taken from the remaining 528 sq m of Rita
and the 564 sq m of Benjamin. Benjamin’s claim that the portion of the property registered in his
name is not covered by the compromise agreement, certainly, has no leg to stand on.

Second, the decision in the reconveyance case sought to be executed. The action for
reconveyance was instituted by the other heirs of Emilio who were not parties to the annulment
case nor to the compromise agreement. They based their claim on their entitlement to 1,091 sq
m as children of the first marriage. Although several cancellations of titles had already taken
place, it is clear from the decision sought to be executed that the subject property was that
originally covered by TCT No. 18550. Considering that Benjamin’s title which is TCT No. 171639
was derived from TCT No. 18550, the same was definitely included.

Moreover, in deciding the reconveyance case in favor of respondents, the court took into
consideration how TCT No. 18550, covering the subject property, was cancelled and how TCT
Nos. 171639 and 171640, in the names of Benjamin and Rita, came about. The court applied the
laws on intestate succession and implied trust before it finally concluded that respondents were
excluded from the partition and are thus entitled to their shares. Undoubtedly, these rules apply
not only to Rita but also to Benjamin. If we were to sustain Benjamin’s claim that the portion of
the property registered in his name is excluded, the shares of the omitted heirs will not be
completed.

Neither can we sustain petitioners’ contention that the writ of execution cannot include the portion
of the subject property registered in the name of Norma as she was never a party to the
reconveyance case.
As clearly stated above, several cancellations of titles had taken place since the death of Emilio
until the present case was instituted, which we now reiterate for a proper perspective. The
subject property was originally covered by TCT No. 18550 in the name of Emilio, married to
Eleuteria. By virtue of the extrajudicial settlement of estate executed by Rita and Benjamin, a
new title was issued in their names, TCT No. 170385. Two new titles were later issued, TCT No.
171639 in the name of Benjamin and TCT No. 171640 in the name of Rita. Pursuant to the
compromise agreement entered into with their brothers and sisters of the second marriage, TCT
No. 171640 was cancelled and new ones were issued, TCT No. 207117 in the name of Monica
and her children and TCT No. 207116 in the name of Rita. A Deed of Exchange was, thereafter,
executed resulting in the cancellation of the latter titles and new ones were issued, TCT No.
207211 in the name of Monica and her children and TCT No. 207210 in the name of Rita.
Eventually, Rita decided to sell the portion of the property registered in her name to Norma
resulting in the cancellation of her title and the issuance of the new title in the name of Norma,
TCT No. 278765. In sum, at the time of the issuance of the questioned writ of execution, the
subject property was covered by TCT No. 171639 covering 564 sq m in the name of Benjamin;
TCT No. 207211 covering 555 sq m in the name of Monica and her children; and TCT No.
278765 covering 445 sq m in the name of Norma, the wife of Benjamin.

Respondents instituted the action for reconveyance involving the subject property originally
covered by TCT No. 18550. At that time, Norma had been the registered owner of a portion of
the subject property. As such, she was an indispensable party as her title to the property was
affected. The Court had thoroughly discussed in a number of cases the nature and definition of
an indispensable party, to wit:

x x x [I]ndispensable parties [are] parties-in-interests without whom there can be no final

determination of an action. As such, they must be joined either as plaintiffs or as defendants. The
general rule with reference to the making of parties in a civil action requires, of course, the
joinder of all necessary parties where possible, and the joinder of all indispensable parties under
any and all conditions, their presence being a sine qua non for the exercise of judicial power. x x
x47

An indispensable party is a party who has such an interest in the controversy or subject matter
that a final adjudication cannot be made, in his absence, without injuring or affecting that interest,
a party who has not only an interest in the subject matter of the controversy, but also has an
interest of such nature that a final decree cannot be made without affecting his interest or leaving
the controversy in such a condition that its final determination may be wholly inconsistent with
equity and good conscience. It has also been considered that an indispensable party is a person
in whose absence there cannot be a determination between the parties already before the court
which is effective, complete, or equitable. Further, an indispensable party is one who must be
included in an action before it may properly go forward.48

Thus, a person who was not impleaded in the complaint cannot be bound by the decision
rendered therein, for no man shall be affected by a proceeding in which he is a
stranger.49 Otherwise stated, things done between strangers ought not to injure those who are
not parties to them.50

In this case, however, as aptly held by the RTC and CA, Norma is estopped from invoking the
rule on indispensable party. Estoppel by laches or "stale demands" ordains that the failure or
neglect, for an unreasonable and unexplained length of time, to do that which by exercising due
diligence could or should have been done earlier, or the negligence or omission to assert a right
within a reasonable time, warrants a presumption that the party entitled to assert it either has
abandoned it or declined to assert it.51 There is no absolute rule as to what constitutes laches; it
is addressed to the sound discretion of the court. Being an equitable doctrine, its application is
controlled by equitable considerations.52
The CA has thoroughly explained the circumstances showing Norma’s knowledge of the
existence of the pending litigation involving the subject property which includes the portion
registered in her name. We quote with approval the exhaustive observations and explanations of
the CA in this wise:

[Records show] that petitioner Norma D. Garcia had knowledge of the existence of Civil Case
No. Q-36147 [for reconveyance] as well as the subject thereof. The Amended Complaint dated
26 October 1982 specifically mentioned petitioner Benjamin Garcia as being married to herein
petitioner Norma Dimalanta Garcia. It even alleged in paragraph 14 thereof that the property
covered by TCT No. 207210 in the name of Rita Garcia-Shipley was transferred to petitioner
Norma Dimalanta Garcia by virtue of a Deed of Sale dated 22 August 1979 executed between
petitioner Norma Garcia and Rita Garcia-Shipley and resulted to the registration and issuance of
TCT No. 278765, now TCT No. 66234, in the name of Norma Garcia married to Benjamin
Garcia. Likewise, in paragraph 15 of the said Amended Complaint, private respondents alleged
that demands were made on Rita Garcia-Shipley, Benjamin Garcia and Norma D. Garcia for the
conveyance to them (plaintiffs) of their legitimate shares.

Further, the private respondents alleged in their Comment dated 10 January 1997, that petitioner
Norma D. Garcia was very much aware of the existence of Civil Case No. Q-36147 as the same
involves the estate of her deceased parent-in-law Emilio Garcia from which her property covered
by TCT No. 66234 came from; that she knew very well that her property is involved in the
litigation yet she did not take steps to have the same excluded therefrom, and that she even
participated actively during the trial of the case and testified to support the theory put up by the
defendants. Petitioner Norma Garcia’s filing of the Petition for Quieting of Title with [the] RTC of
Quezon City docketed as Q-93-17396 raffled to Branch 103 (Judge Jaime N. Salazar, Jr.)
supports private respondents’assertion of petitioner Norma Garcia’s knowledge of the existence
and subject matter of the reconveyance case (Civil Case No. Q-36147) as she categorically
stated in paragraph 6 of said Petition that said case for reconveyance of property apparently
includes the property registered in her name. x x x

xxxx

We, therefore, find that petitioner Norma Garcia is estopped by laches from invoking the rule on
indispensable parties. Taking into consideration the established circumstances surrounding the
transfer in her name of the parcel of land covered by TCT No. 66234 (278765), her non-joinder
as an indispensable party is a mere technicality that cannot prevail over considerations of
substantial justice. x x x53

Indeed, evidence clearly shows that Norma had knowledge of the existence and the pendency of
the reconveyance case filed by respondents against her husband Benjamin, Rita, and Monica
and her children. She is now estopped from claiming that the RTC had not acquired jurisdiction
over her and thus not bound by the decision sought to be executed.54 The RTC, therefore, did not
abuse its discretion in denying petitioners’ urgent motion to quash the writ of execution.

WHEREFORE, premises considered, the petition is DENIED for lack of merit. The Court of
Appeals Decision dated May 12, 2005 and Resolution dated August 3, 2005 in CA-G.R. SP No.
41556, are AFFIRMED.

SO ORDERED.

DIOSDADO M. PERALTA
Associate Justice

WE CONCUR:
 PRESBITERO J. VELASCO, JR.
Associate Justice
Chairperson

ROBERTO A. ABAD JOSE PORTUGAL PEREZ*

Associate Justice Associate Justice

JOSE CATRAL MENDOZA

Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Court’s Division.

PRESBITERO J. VELASCO, JR.

Associate Justice
Third Division, Chairperson

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson’s Attestation,
I certify that the conclusions in the above Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Court’s Division.

RENATO C. CORONA
Chief Justice

Footnotes

* Designated as an additional member in lieu of Associate Justice Estela M. Perlas-

Bernabe, per Special Order No. 1152, dated November 11, 2011.

1
 Penned by Associate Justice Celia C. Librea-Leagogo, with Associate Justices Andres
B. Reyes, Jr. and Lucas P. Bersamin (now a member of this Court), concurring; rollo, pp.
19-57.

2
 Id. at 59-60.

3
 CA rollo, pp. 89-117.

4
 Branch 76, Quezon City.

5
 Penned by Judge Monina A. Zeñarosa.

6
 CA rollo, p. 75.

7
 Id. at 68-74

8
 Id. at 78.
9
 Id. at 76-77.

10
 Rollo, p. 21.

11
 Id.

12
 Id. at 21-22.

13
 Id. at 22.

14
 Id.

15
 CA rollo, pp. 23-26.

16
 Rollo, p. 22.

17
 Id. at 23.

18
 CA rollo, pp. 24-25.

19
 Rollo, p. 24.

20
 Id.

21
 Id.

22
 CA rollo, pp. 27-31.

23
 Penned by Judge Manuel M. Calanog, Jr.; id. at 32-37.

24
 Id. at 37.

25
 Id. at 34-37.

 Embodied in a Decision dated October 4, 1990 in CA-G.R. CV No. 21765; Penned by

26

Associate Justice Luis L. Victor, with Associate Justices Vicente V. Mendoza and
Segundino G. Chua, concurring, CA rollo, pp. 38-44.

27
 Rollo, pp. 32-33.

28
 CA rollo, pp. 45-46.

29
 Id. at 52-54.

30
 Rollo, p. 33.

31
 CA rollo, pp. 194-195.

32
 Id. at 58-59.

33
 Id. at 59.

34
 Rollo, p. 35.
35
 CA rollo, pp. 68-74.

36
 Rollo, p. 40.

37
 CA rollo, p. 75.

38
 Id. at 76-77.

39
 Id. at 78.

40
 Rollo, p. 43.

41
 Id. at 45.

42
 Id.

43
 Id. at 49-52.

44
 Id. at 53.

45
 Monica and her children.

 But their actual share is only 444.60 sq m because the 27.5 sq m service road was to
46

be deducted from their share.

 Casals v. Tayud Golf and Country Club, Inc., G.R. No. 183105, July 22, 2009, 593
47

SCRA 468, 490; Galicia v. Manliquez Vda. de Mindo, G.R. No. 155785, April 13, 2007,
521 SCRA 85, 93-94; Arcelona v. CA, 345 Phil. 250, 267 (1997).

48
 Casals v. Tayud Golf and Country Club, Inc., supra, at 491-492.

49
 Arcelona v. CA, supra note 47, at 270.

50
 Casals v. Tayud Golf and Country Club, Inc., supra note 47, at 501.

 Galicia v. Manliquez Vda. de Mindo, supra note 47, at 96; Republic v. Sandiganbayan,
51

G.R. No. 152154, July 15, 2003, 406 SCRA 190, 252.

52
 Galicia v. Manliquez Vda. de Mindo, supra note 47, at 96.

53
 Rollo, pp. 49-52.

54
 See Oro Cam Enterprises, Inc. v. Court of Appeals, 377 Phil. 469, 480 (1999).