A recurring question in unlawful detainer and forcible entry cases is whether the municipal/metropolitan trial court is ousted of jurisdiction when the issue of ownership is raised.

In its decision,^[1] dated March 17, 1993, the Court of Appeals, in affirming the decisions of the Regional Trial Court of Malolos, Bulacan, Branch 19^[2] and the Municipal Trial Court of Bulacan, Bulacan,^[3] ruled in the negative.

After a review of the facts and the pertinent law, we see no reason to disturb the ruling of the appellate court.

The facts culled from the records are as follows:

Petitioner Silvina Torres Vda. de Cruz and private respondent Priscilla Cruz-Gatchalian are sisters-in-law. Petitioner is the widow of private respondent's brother, Jose Cruz, Sr. Private respondent and her siblings (Jose, Maria, and Emilio) inherited from their mother, Emilia Gloria-Cruz, a parcel of land in San Nicolas, Bulacan, Bulacan. The land, with a total area of 924 sq. m., is part of a larger tract of land consisting approximately of 1,848 sq. m. A portion of this land, consisting of 693 sq. m., is covered by OCT No. P-397-C issued in the name of private respondent.^[4] On this 693 sq. m. lot is built the house (with a floor area of 319 sq. m.) of petitioner and her children.

On May 29, 1989, private respondent, through counsel, sent a letter to petitioner demanding that she vacate the premises and remove the house built thereon. As petitioner refused to do so, private respondent brought the matter to the barangay authorities for conciliation. However, the parties failed to settle their dispute amicably, prompting private respondent to file the case in the Municipal Trial Court of Bulacan, Bulacan, where it was docketed as Civil Case No. 734. Private respondent alleged that she was the owner of the lot in question and that petitioner had been merely allowed to stay on it.

In her answer, petitioner denied private respondent's ownership and claimed the land to be hers on the basis of Tax Declaration No. 9124 indicating her and her late husband Jose Cruz, Sr. and spouses Emilio Cruz and Engracia Villanueva as owners. Moreover, she alleged that on July 25, 1989, she had in fact filed a complaint for reconveyance, damages, and injunction against private respondent before the Regional Trial Court of Malolos, Bulacan, Branch 22, docketed as Civil Case No. 409-M-89. Hence, she argued that the Municipal Trial Court had no jurisdiction to decide the ejectment case because the question of ownership is an underlying issue which must first be determined.^[5]

It appears that petitioner's action for reconveyance was dismissed without prejudice on May 2, 1990 precisely because of petitioner's failure "to amend the complaint so as to include only reconveyance and damages," and exclude matters pertaining to the ejectment case as ordered by the Court.^[6] For this reason, petitioner and her children filed on April 12, 1991 another complaint for reconveyance and damages before the Regional Trial Court of Malolos, Bulacan, Branch 15, docketed as Civil Case No. 225-M-91.^[7]

On May 16, 1991, the Municipal Trial Court rendered a decision in the ejectment case ordering petitioner to vacate the property.

Petitioner appealed to the Regional Trial Court of Malolos, Bulacan, Branch 19 which, on March 30, 1992, affirmed the decision of the Municipal Trial Court in toto.^[8] The dispositive portion of the RTC's decision reads:

WHEREFORE, after a careful scrutiny of the evidence submitted, the Court finds preponderance of evidence in favor of the Plaintiff, Priscilla Cruz-Gatchalian, and against the Defendant, Silvina Torres Vda. de Cruz, to vacate the lot consisting of 698^[9] sq. m. more or less covered by the Original Certificate of Title No. P-397-C located at San Nicolas, Bulacan, Bulacan and all person claiming rights under her, to pay P100.00 a month for the reasonable use of the property from the extra-judicial demand on May 29, 1989 until she vacates the premises and pay P500.00 as attorney's fee without pronouncement as to cost.

Petitioner appealed the case to the Court of Appeals, which rendered the questioned decision. The appellate court upheld the jurisdiction of the Municipal Trial Court and affirmed private respondent's right to material possession, as distinguished from possession de jure, of the property in question.

Hence, this petition for review on certiorari. Petitioner argues that the primary issue in this case is the ownership of the land in question since private respondent relies on a certificate of title while she (petitioner) relies on a tax declaration in support of their respective right to the possession of the lot. She contends that the question of possession cannot be determined without first resolving the question of ownership. For this reason, petitioner maintains that the Municipal Trial Court has no jurisdiction over this case.^[10] Petitioner cites the following excerpt from this Court's ruling in Dante v. Sison,^[11] which is actually a quotation from the case of Ching v. Malaya:^[12]

There is one exception, however, and that is where it appears during the trial that, by the nature of the evidence presented, the issue of possession cannot be decided without deciding the issue of ownership. In such a case, the jurisdiction of the municipal court is lost and the action should be dismissed.... An illustration is the case of Teodoro v. Balatbat, where the defendant claims possession by virtue of a deed of sale allegedly executed by the plaintiff, who in turn denied its authenticity. As there was no indication that the defendant's claim was unfounded, the municipal court could not continue with the case because it had lost the competence to decide it.

The contention has no merit. The excerpt quoted, as clearly indicated, states the exception. The ruling in Dante v. Sison, which is precisely against petitioner's position, is that an action for reconveyance or annulment of title filed by the defendant in an ejectment case cannot defeat the jurisdiction of the ejectment court. This Court held in Dante v. Sison:

The only issue in this case is whether or not the hearing of an ejectment case in the Municipal Trial Court may be stayed by the pendency of an annulment of sale case, involving the same property, subsequently filed with the Regional Trial Court.

We rule in the negative.

In the recent decisions of this Court, we have repeatedly held that the filing of an action for reconveyance of title over the same property or for the annulment of the deed of sale over the land does not divest the Municipal Trial Court of its jurisdiction to try the forcible entry or unlawful detainer case before it. . . This is so because, while there may be identity of parties and subject matter in the forcible entry case and the suit for annulment of title and/ or reconveyance, the rights asserted and the relief prayed for are not the same. . . The respondents in ejectment proceedings cannot defeat the summary nature of the action against them by simply filing an action questioning the ownership of the person who is trying to eject them from the premises. [citations omitted]^[13]

More importantly, the law has undergone a change since Ching v. Malaya, the case in fact cited by petitioner, was decided. R.A. No. 296 (Judiciary Act of 1948), §88, under which the case was decided, allowed inquiries into questions of ownership only for the limited purpose of determining "the character and extent of possession and damages for detention." But after the enactment of B.P. Blg. 129 (Judiciary Reorganization Act of 1980), municipal/ metropolitan trial courts have been given the power to determine ownership questions, though provisionally, in cases where the issue of ownership is intertwined with the question of possession. Thus, after surveying relevant legislation over three decades, this Court, in an opinion by Justice Regalado, concluded in Refugia v. Court of Appeals:^[14]

These issuances changed the former rule under Republic Act No. 296 which merely allowed inferior courts to receive evidence upon the question of title solely for the purpose of determining the extent and character of possession and damages for detention, which thereby resulted in previous rulings of this Court to the effect that if it appears during the trial that the principal issue relates to the ownership of the property in dispute and any question of possession which may be involved necessarily depends upon the result of the inquiry into the title, then the jurisdiction of the municipal or city courts is lost and the action should be dismissed. With the enactment of Batas Pambansa Blg. 129, the inferior courts now retain jurisdiction over an ejectment case even if the question of possession cannot be resolved without passing upon the issue of ownership, with the express qualification that such issue of ownership shall be resolved only for the purpose of determining the issue of possession. In other words, the fact that the issues of ownership and possession de facto are intricately interwoven will not cause the dismissal of the case for forcible entry and unlawful detainer on jurisdictional grounds. (Emphasis added)

The jurisdiction of inferior courts to resolve the issue of ownership in ejectment cases, while not plenary, is certainly broader than merely for the purpose of determining the extent of possession. One of the guidelines set forth in the same case of Refugia indicates the scope of their power, thus:^[15]

Where the question of who has prior possession hinges on the question of who the real owner of the disputed portion is, the inferior court may resolve the issue of ownership and make a declaration as to who among the contending parties is the real owner. In the same vein, where the resolution of the issue of possession hinges on a determination of the validity and interpretation of the document of title or any other contract on which the claim of possession is premised, the inferior court may likewise pass upon these issues. This is because, and it must be so understood, that any such pronouncement made affecting ownership of the disputed portion is to be regarded merely as provisional, hence, does not bar nor prejudice an action between the same parties involving title to the land.

Nor does the fact that the parties base their respective claims of possession on evidence of ownership make ownership the principal issue in the case or qualify the action as one for reconveyance instead of ejectment. The jurisdiction of a court over the subject matter is determined by the allegations of the complaint and cannot be made to depend upon the defenses set up in the answer or pleadings filed by the defendant.^[16] Since there is no dispute that the allegations of the complaint filed by private respondent sufficiently qualify the case as one for ejectment, the inferior court acquired jurisdiction over the subject matter thereof.

WHEREFORE, the decision of the Court of Appeals is AFFIRMED.

SO ORDERED.

Bellosillo, (Chairman), Puno, Quisumbing, and Buena, JJ., concur.

---

^[1] Per Justice Alfredo Marigomen and concurred in by Justices Santiago M. Kapunan and Cancio C. Garcia.

^[2] Dated March 30, 1992.

^[3] Dated May 16, 1991.

^[4] Based on the decision of the Regional Trial Court of Malolos, Bulacan, Branch 15, in Civil Case No. 225-M-91, the lot was originally owned by Marcos Gloria, private respondent's maternal uncle. Marcos died single and without issue. Hence, the land was divided equally (308 sq. m. each) among his six brothers and sisters, namely, Emilia (mother of private respondent) Maria, Felipa, Segunda, Manuel, and Enrique. It appears that before the demise of her mother, private respondent bought the shares of Segunda and Manuel and placed it in the name of her mother Emilia, thus increasing the latter's share to 924 sq. m. Upon the death of Emilia, her four children (private respondent, Jose, Maria, and Emilio) succeeded to her portion of the land, each of them getting 231 sq. m. Maria and Emilio waived their rights to their respective 231 sq. m. shares in favor of private respondent, thus effectively giving the latter 693 sq. m. Jose's (petitioner's deceased husband) shares of 231 sq. m. portion of the lot is not disputed. On November 5, 1987, the Register of Deeds of Bulacan issued OCT No. P-397-C (covering an area of 693 sq. m.) in the name of private respondent. On the same day, she was also issued OCT No. P-398-C (covering an area of 616 sq. m.) since she had purchased the shares of her aunts, Felipa and Maria, of 308 sq. m. each.

^[5] CA Decision, p. 2, Rollo, p. 17.

^[6] Ibid.

^[7] The records indicate that this case was likewise dismissed by the trial court on June 20, 1994. See Rejoinder to Petitioner's Reply, Annex A; Rollo, pp. 79-85.

^[8] CA Decision, p. 3; Rollo, p. 18.

^[9] The records variably indicate 698 sq. m. and 693 sq. m. as the area covered by OCT No. P-397-C. (See Rollo, pp. 8, 17, 79 and 80). However, the figure 693 sq. m. appears to be more consistent with the facts.

^[10] Petition, pp. 4-5; Rollo, pp. 10-11.

^[11] 174 SCRA 517, 522 (1989).

^[12] 153 SCRA 412, 417-418 (1987).

^[13] 174 SCRA at 519-520.

^[14] 258 SCRA 347, 360 (1996) (emphasis added).

^[15] 258 SCRA 365.

^[16] Ganadin v. Ramos, 99 SCRA 613, 621-622 (1980).