Mercy Vda. De Roxas, represented by Arlene C.

Roxas-Cruz,
in her capacity as substitute appellant-petitioner,
Petitioner,
-versusOur Ladys Foundation, Inc.,
Respondent
G.R. No. 182378
March 06, 2013
FACTS:
On 1 September 1988, Salue Dealca Latosa filed before the Regional Trial Court a complaint for the recovery of
ownership of a portion of her residential land located at Our Ladys Foundation Village Bibincahan, Sorsogon. According
to her, Atty. Henry Amado Roxas represented by herein petitioner, encroached on a quarter of her property by
arbitrarily extending hid concrete fence beyond the correct limits. In his answer, Roxas imputed the blame to
respondent Our Ladys Village Foundation Inc., the former then filed a Third-Party complaint against respondent and
claimed that he only occupied the adjoining portion inorder to get the equivalent area of what he had lost when the
respondent foundation trimmed his property for the subdivision road.
The RTC admitted the Third-Party complaint and proceeded to trial based on merits. The RTC held based on
evidence that Roxas occupied a total of 112 sq.m of Latosas lots, and that respondent foundation trimmed the
formers property by 92 sq.m. The court rendered judgement on the first complaint ordering the defendant foundation
to surrender and return the portion of the 116 sq.m which belonged to the plaintiff, Latosa. The court also ordered
respondent Roxas to demolish whatever structure constructed thereon at his own expense. With regards to the thirdparty complaint, the court ordered the third-party defendant foundation reimburse the third-party plaintiff Roxas the
value of 92 sq.m which belonged to the latter, plus legal interest to be reckoned from the time it was paid to the thirdparty defendant.
Roxas appealed to the CA, which denied the appeal. The decision being final, the RTC issued a Writ of
Execution to implement the ruling ordering the third-party respondent to reimburse Roxas for the value of the property.
The trial court approved the Sheriffs Bill which valued the property at 2,500 pesos per sq.m. Opposing to the valuation
of the property, the defendant foundation filed a motion to quash the bill and a motion Inhibition of the RTC judge and
contending that it should only pay Roxas at a rate of 40.00 pesos per sq.m at the same rate that Roxas paid when the
latter purchased the property. The trial court approved an Amended Sheriffs Bill which reduced the valuation to 1,800
per sq.m. the RTC denied both thr motions and cited fairness to justify the computations of respondents judgement
obligation.
Notices of garnishment were issued by the sheriff to Bishop Robert Arcilla-Maullon, the foundations generalmanager. The foundation, refusing to pay the said amount per sq.m filed a Rule 65 Petition before the CA. The CA,
reversed the decision of the RTC ordering the respondent foundation to reimburse the petitioner at the rate of 40.00
pesos per sq.m.
ISSUES:
1. The determination of the correct amount to be reimbursed by the respondent foundation to Roxas.
2. Whether or not Arcilla-Maullon should be personally held liable for the obligation of the respondent foundation.
HELD:
To settle the contention by the respondent foundation, the court resorts to the provisions of the Civil Code,
specifically Article 450 referring to encroachments in bad faith, the owner of the land encroached upon petitioner
herein- has the option to require respondent builder to pay the price of land. Although this provision does not explicitly
state the reckoning period for valuation of property, the court by citing the case of Tuatis vs. Spuses Escol which
illustrates that the present and current fair value of the land is to be reckoned at the time that the land owner elected
the choice, not at the time that the property was purchased.
As to the second issue, the court holds that since respondent foundations manager was not a party to the
case, the CA correctly ruled that Arcilla-Maullon cannot be held personally liable for the obligation of the foundation.
The respondent foundation was ordered to pay Roxas 1,800 pesos per sq.m as determined by the decision of the RTC.