G.R. No.

L-44339 December 2, 1987

CRISANTA F. SENO, CAROLA SENO SANTOS, MANUEL SENO, JR., DIANA SENO CONDER, EMILY
SENO and WALTER SENO, plaintiffs,
vs.
MARCOS MANGUBAT and Spouses FRANCISCO LUZAME and VERGITA PENAFLOR, ANDRES
EVANGELISTA and BIENVENIDO MANGUBAT, defendants.

Subject Matter: PARTIES TO CIVIL ACTION - RULE 3, SECTIONS 7 TO 12

Action before the SC: Petition for review on certiorari 45

DOCTRINE: Sec. 7. Compulsory joinder of indispensable parties. — Parties in interest without

whom no final determination can be had of an action shall be joined either as plaintiffs or
defendants.

Sec. 8. Joinder of proper parties. — When persons who are not indispensable but who ought to
be parties if complete relief is to be accorded as between those already parties, have not been
made parties and are subject to the jurisdiction of the court as to both service of process and
venue, the court shall order them summoned to appear in the action. But the court may, in its
discretion, proceed in the action without making such persons parties, and the judgment
rendered therein shall be without prejudice to the rights of such persons.

Under Section 7, indispensable parties must always be joined either as plaintiffs or defendants,
for the court cannot proceed without them. Necessary parties must be joined, under Section 8,
in order to adjudicate the whole controversy and avoid multiplicity of suits.

Indispensable parties are those with such an interest in the controversy that a final decree
would necessarily affect their rights, so that the courts cannot proceed without their presence.
Necessary parties are those whose presence is necessary to adjudicate the whole controversy,
but whose interests are so far separable that a final decree can be made in their absence
without affecting them.

This is an appeal that was certified to this Court by the Court ofAppeals 1 from the order of the
Court of First Instance of Rizal, Branch 1, dated September 29,1972 in Civil Case No. 12205
dismissing the action for reformation of instrument and annulment of subsequent sale. 2

FACTS
Plaintiff Crisanta Seno, a widow and herein defendant Marcos Mangubat agreed on a mortgage
for the sum of P15,000.00 with a stipulation that as long as the 2% per month interest is being
paid, the mortgage over the property will not be foreclosed.

On the assurance of defendant Marcos Mangubat, a practicing lawyer, Seno agreed to the
execution of a Deed of Absolute Sale over the subject property for a consideration of P5,000.00
in favor of defendant Mangubat and certain Andres Evangelista and Bienvenido Mangubat on
July 17, 1961.
On January 8, 1962 Andres Evangelista and Bienvenido Mangubat executed a Deed of Absolute
Sale transferring their share in the subject property to defendant Marcos Mangubat;

Sometime in 1963, when plaintiff Crisanta F. Seno failed to pay the monthly interest of 2%, she
was sued for ejectment by defendant Marcos Mangubat alleging non-payment of rentals;

Seno also learned that defendant Marcos Mangubat sold the subject property in favor of
spouses Francisco Luzame and Vergita Penaflor and Sena claimed that the spouses Luzame and
Penaflor bought the property in bad faith since they had knowledge of the circumstances
surrounding the transaction between plaintiff and defendant Marcos Mangubat.

Defendant spouses Luzame filed an ejectment case against plaintiff Crisanta Seno for alleged
non-payment of rentals.
RTC

Plaintiff filed a complaint seeking the reformation of deed of sale executed in favor of defendant
Marcos Mangubat and the annulment of subsequent sale to defendant spouses Francisco
Luzame and Vergita Penaflor of a parcel of land in Barrio Dongalo, Paranaque, Rizal.

On motion of defendant spouses Luzame and Penaflor, TC the inclusion as defendants of Andres
Evangelista and Bienvenido Mangubat on the ground that they are indispensable parties,
plaintiffs filed their amended complaint impleading Andres Evangelista and Bienvenido
Mangubat as defendants.

The newly impleaded defendants moved for the dismissal of the case against them on the
ground of prescription - granted Defendants Luzame, Penaflor and Mangubat in their motion for
reconsideration asked the court a quo to dismiss the case against all the defendants- GRANTED
court is no longer in a position to grant plaintiffs' demands, principally the reformation of
subject Deed of Absolute Sale

Plaintiff’s Motion of Reconsideration - denied

CA
Plaintiff’s filed an appeal praying for the reversal of the orders of the TC dismissing the
complaint

SC
CA certified the instant case to this Court holding that the assignment of errors made by
plaintiffs in their appeal raised purely legal questions

ISSUE: WON defendants Andres Evangelista and Bienvenido Mangubat indispensable parties in
the case without whom no action can be properly taken thereon?

HELD:
NO
For the determination of this issue, We find it necessary to consider the distinction between
indispensible and proper parties are clearly stated in
Sections 7 and 8, Rule 3 of the Revised Rules of Court which provides

Sec. 7. Compulsory joinder of indispensable parties. — Parties in interest without whom no final
determination can be had of an action shall be joined either as plaintiffs or defendants.

Sec. 8. Joinder of proper parties. — When persons who are not indispensable but who ought to
be parties if complete relief is to be accorded as between those already parties, have not been
made parties and are subject to the jurisdiction of the court as to both service of process and
venue, the court shall order them summoned to appear in the action. But the court may, in its
discretion, proceed in the action without making such persons parties, and the judgment
rendered therein shall be without prejudice to the rights of such persons.

Under Section 7, indispensable parties must always be joined either as plaintiffs or defendants,
for the court cannot proceed without them. Necessary parties must be joined, under Section 8,
in order to adjudicate the whole controversy and avoid multiplicity of suits.

Indispensable parties are those with such an interest in the controversy that a final decree
would necessarily affect their rights, so that the courts cannot proceed without their presence.
Necessary parties are those whose presence is necessary to adjudicate the whole controversy,
but whose interests are so far separable that a final decree can be made in their absence
without affecting them.

In the present case, there are no rights of defendants Andres Evangelista and Bienvenido
Mangubat to be safeguarded if the sale should be held to be in fact an absolute sale not if the
sale is held to be an equitable mortgage.

Defendant Marcos Mangubat became the absolute owner of the subject property by virtue of
the sale to him of the shares of the aforementioned defendants in the property. Said defendants
no longer have any interest in the subject property. However, being parties to the instrument
sought to be reformed, their presence is necessary in order to settle all the possible issues of tile
controversy.

Whether the disputed sale be declared an absolute sale or an equitable mortgage, the rights of
all the defendants will have been amply protected defendant-spouses Luzame in any event may
enforce their rights against defendant Marcos Mangubat.

In fact the plaintiffs were not after defendants Andres Evangelista and Bienvenido Mangubat as
shown by their non-inclusion in the complaint and their opposition to the motion to include said
defendants in the complaint as ndispensable parties. It was only because they were ordered by
the court a quo that they included the said defendants in the complaint. The lower court
erroneously held that the said defendants are indispensable parties.

Notwithstanding, defendants Andres Evangelista and Bienvenido Mangubat not being

indispensable parties but only proper parties, their joinder as parties defendants was correctly
ordered being in accordance with Sec. 8 of Rule 3.

By the dismissal of the case against defendants Andres Evangelista and Bienvenido Mangubat,
the court a quohad lost jurisdiction over them. We have already pointed out that the joinder of
proper parties is necessary in order to determine all the possible issues of the controversy; but if
for some reason or another it is not possible to join them, as when they are out of the
jurisdiction of the Court, the court may proceed without them, and the judgment that may be
rendered shall be without prejudice to their rights. Hence, notwithstanding the absence of said
defendants, the court could still proceed with the trial of the case as against the remaining
defendants in accordance with Sec. 8 of Rule 3.

Nevertheless, the court is constrained to affirm the dismissal of the complaint against all the
defendants as there is merit in the argument raised by defendants-appellees that plaintiffs are
barred by laches to bring suit against them. A perusal of the records shows that from the time of
the execution of the deed of sale on July 17, 1961 to the time of the filing of the present
complaint on August 29, 1969 or a period of 8 years, I month and 12 days, plaintiffs never took
any step to enforce their rights which they claim to have despite the several opportunities
available to them.

Defendant Marcos Mangubat filed an ejectment suit against plaintiff Crisanta Seno in 1963 and
this fact was admitted by the plaintiffs in their complaint. For failure of plaintiff to appear in the
case, a decision was rendered by the trial court ordering plaintiffs to vacate the subject property
which decision was duly executed.

It further appears from the complaint that plaintiffs were well aware of the transfer of the title
from the name of plaintiff Crisanta Seno to the names of defendants Marcos Mangubat, Andres
Evangelista and Bienvenido Mangubat and subsequently to the name of defendant Marcos
Mangubat alone as early as 1963 when the ejectment case was filed against plaintiffs, and also
they did not do anything about it.

In January 1969, plaintiffs learned of the sale of the subject property to defendants-spouses
Luzame. but it was only on August 29, 1969 when plaintiffs brought this action and only after an
ejectment case was filed by said defendant spouses against plaintiff Crisanta Seno before the
Municipal Court of Paranaque, Rizal on August 4, 1969.

As defendants-appellees contend, before the nine-year period lapsed, plaintiffs never raised a
voice to protest against all these proceedings. They chose to sleep on their rights and to rely on
defendants' alleged word that their true agreement would be respected rather than bring their
grievances to a court of law. However, when an ejectment case was filed against them just when
the 10-year prescriptive period for bringing of their suit was nearly
over, they finally decided to stake their claim against the defendants.

By the negligence of plaintiffs in asserting their rights for an unreasonable length of time, they
are now forever precluded from enforcing whatever right they may have against defendants.
Indeed, it is an indicia of the infirmity of their claim.