FACTS:

Respondent Elmer Mata filed a complaint for annulment of documents, partition, and damages against petitioner George Agcaoili and other defendants. Respondent alleged that a parcel of land owned by Justo Mata was sold to Spouses Pedro Mata, Sr. and Josefina B. Mata through a deed of absolute sale. After the deaths of the spouses, the lot was declared in their names without respondent's knowledge. The petitioner and other defendants subdivided the lot and obtained tax declarations in their names, including the foreshore portion solely declared in the name of Pedro Mata, Jr. Respondent sought nullification of the documents, partition of the land, and restoration of the original tax declaration.

Respondent Pedro Mata, Sr. filed a complaint seeking nullification of documents and partition of the property. He claimed that the property was conjugal property of Pedro Mata, Sr. and Josefina B. Mata. He argued that the Declaration of the Status of Real Estate Property and the Subdivision Plan were invalid, as well as the subsequent transfer of the property to the petitioners. The respondent requested attorney's fees, moral damages, and exemplary damages. The respondent passed away and was substituted by his heirs. The petitioners disputed the respondent's claims and argued that they validly acquired their respective shares in the property. The Trial Court ruled in favor of the respondent, declaring the mentioned documents and transfers as void.

ISSUES:

1. Did the trial court commit reversible error when it ordered the partition of the lot even though not all of the indispensable parties were impleaded in the case below?

2. Whether the Heirs of Pedro Mata, Jr. are indispensable parties in the complaint for annulment, partition, and damages.

3. Whether the non-joinder of indispensable parties is a ground for the dismissal of the action.

4. Whether the case should be remanded to the Regional Trial Court (RTC) for the inclusion of indispensable parties who were not impleaded.

5. Whether the case should proceed to the disposition of the merits after the inclusion of the indispensable parties.

RULING:

1. The Court granted the petition.

2. The Court held that the petitioner, who claims to be one of the compulsory heirs, should not have been excluded from the partition of the estate. The Court noted that no one has challenged the petitioner's claim to being a compulsory heir, and therefore he should be included in the partition. The trial court and the Court of Appeals failed to consider this crucial matter, which affects the petitioner's legal standing in the case.

3. The Court found that the trial court exceeded its jurisdiction when it directed the ejectment of the Heirs of Pedro Mata, Jr. without due process. The occupants, who were undisputed compulsory heirs, were never summoned or given their day in court. This was a violation of their right to due process.

4. Yes, the Heirs of Pedro Mata, Jr. are indispensable parties in the complaint for annulment, partition, and damages. In an action for partition, all co-heirs and persons having an interest in the property are indispensable parties. The absence of an indispensable party renders all subsequent actions of the court null and void, for want of authority to act, not only as to the absent parties but even as to those present.

5. No, the non-joinder of indispensable parties is not a ground for the dismissal of the action. Instead, the proper remedy is to implead the non-party claimed to be indispensable. Parties may be added by order of the court on motion of the party or on its own initiative at any stage of the action and/or at such times as are just.

6. The petition is granted. The Court of Appeals' decision and resolution, as well as the RTC's decision, are reversed and set aside. The case is remanded to the RTC for the inclusion of the Heirs of Pedro Mata, Jr. and all other persons interested in the property as party-defendants, as they are considered indispensable parties. After their inclusion, the parties are to be given an opportunity to present their own evidence, and the RTC is directed to proceed with the resolution of the case on the merits with dispatch, including the determination of the claimed heirship of petitioner George Agcaoili.

PRINCIPLES:

• Nemo dat quod non habet - The subsequent transfer of invalidly acquired property confers no rights upon the transferee.

• Indispensable parties - In actions for partition, all indispensable parties, including all the co-owners, must be impleaded to ensure a complete and effective adjudication of the issues and to avoid multiplicity of suits.

• Due process - No person shall be deprived of life, liberty, or property without due process of law. This includes the right to be heard and given the opportunity to present evidence in one's defense.

• An indispensable party is one whose interest will be affected by the court's action in the litigation, and without whom no final determination of the case can be had.

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

• In an action for partition, all the co-heirs and persons having an interest in the property are indispensable parties.

• Non-joinder of indispensable parties is not a ground for the dismissal of the action. The proper remedy is to implead the non-party claimed to be indispensable.

• Parties may be added by order of the court on motion of the party or on its own initiative at any stage of the action and/or at such times as are just.

• Indispensable parties must be impleaded in a case for a complete and effective resolution.

• The inclusion of indispensable parties is necessary for the disposition of the case on the merits.

• The remand of a case to the RTC for the inclusion of indispensable parties is appropriate when they were not impleaded initially.