FACTS:

Respondent Mariam K. Kairuz filed a complaint for ejectment against petitioners John Cary Tumagan, Alam Halil, and Bot Padilla, alleging that they conspired and forcibly took possession of her property after the death of her husband, Laurence Ramzy Kairuz. Petitioners argued that Mariam was never the sole owner or possessor of the property, as Laurence co-owned it with his sisters. They claimed that Laurence, as attorney-in-fact for his sisters, entered into a Memorandum of Agreement (MOA) with a waterworks company to establish a new corporation, Bali Irisan Resources, Inc. (BIRI), which would take possession of the property. The Municipal Circuit Trial Court (MCTC) dismissed the case due to Mariam's failure to implead BIRI as an indispensable party. The Regional Trial Court (RTC) upheld the dismissal, ruling that jurisdiction over BIRI was necessary to resolve the issue of possession. Mariam appealed to the Court of Appeals (CA), which reversed the RTC's decision, holding that non-joinder of parties is not a ground for dismissal and that the proper remedy is to implead the non-party claimed to be indispensable.

ISSUES:

1. Whether the court erred in dismissing the complaint for failure to implead an indispensable party

2. Whether the court erred in recognizing the petitioner's claim of possession

3. Whether the issues are intra-corporate in nature and should be resolved by the RTC in Angeles City

4. • Whether the controversy is an intra-corporate dispute, or an ejectment case filed by a co-owner who was unlawfully deprived of her right to possess the property
5. • Whether the Municipal Circuit Trial Court has jurisdiction over the case

RULING:

1. The court did not err in dismissing the complaint for failure to implead an indispensable party.

2. • An indispensable party is necessary for a final determination of an action and must be joined as a plaintiff or defendant.
3. • BIRI is an indispensable party being the registered owner of the property and the party at whose behest the petitioner-employees acted.
4. • The absence of an indispensable party renders subsequent actions of the court null and void.
5. • The CA's ruling, recognizing the petitioner's possession, is null and void for want of jurisdiction without the participation of BIRI.

6. The court erred in recognizing the petitioner's claim of possession.

7. • The jurisdiction of the MCTC over the complaint for forcible entry is contested by the petitioners.
8. • The case involves management of corporate property and is an intra-corporate dispute falling under the jurisdiction of the RTC of Angeles, Pampanga.
9. • The case should have been brought before the appropriate commercial court as per the MOA.
10. • The court did not acquire jurisdiction over the complaint.

11. The Court ruled that the controversy is an intra-corporate dispute between the corporation and its shareholder, not an ejectment case. The Municipal Circuit Trial Court lacks jurisdiction over the case.

PRINCIPLES:

• An indispensable party is necessary for a final determination of an action and must be joined in the proceedings before judgment is rendered.

• The absence of an indispensable party renders subsequent actions of the court null and void for want of authority to act.

• The joinder of indispensable parties is mandatory and the responsibility of impleading them rests on the plaintiff.

• Complaints involving management of corporate property and intra-corporate disputes fall under the jurisdiction of the appropriate commercial court.

• In determining the existence of an intra-corporate controversy, the status or relationship of the parties and the nature of the question that is the subject of their controversy must be considered

• Shareholders are not the legal owners of corporate property, which is owned by the corporation as a distinct legal person

• Shareholders only have an inchoate interest in the management and assets of the corporation

• Courts must consider the true nature of the controversy in determining jurisdiction