Barred

A prior judgment is a bar to a subsequent action if: (1) it is final; (2) it is on the merits, that is, it is rendered after a consideration of the evidence of stipulations submitted by the parties at the trial of the case; (3) it is rendered by a court having jurisdiction over the subject matter and the parties; and (4) there is, between the first and second actions, identity of parties, of the subject matter and of cause of action. If the judgment or order is issued for failure to prosecute is it considered as judgment on the merits as to bar a subsequent action? This is one of the issues raised in this case of the heirs of Cardo and Rosa.

Cardo and Rosa acquired a parcel of land containing an area of 16,495 square meters (lot 329 of the Laguna Resettlement Project) in San Pedro, Laguna known as the Tunasan Estate. The Deed of Sale executed by the Department of Agrarian Reform (DAR) prohibited the transfer of the land within ten years from the issuance of the title to any person other than their relatives within the third civil degree of consanguinity or affinity who are at the same time qualified beneficiaries. This prohibition is pursuant to the Agrarian Reform Code.

However, pending issuance of the title, PD 1474 was enacted declaring the Tunasan Estate suitable for residential, commercial, or industrial or other non-agricultural purposes that effectively repealed the 10-year prohibition the Agrarian Reform Code. Thus when Cardo and Rosa obtained the title to the land on May 25, 1979, they were able to subsequently sell the same to Mercy on June 10, 1979, without waiting for the ten-year period and even if Mercy was not their relative within the third civil degree. So a new Title was issued in the name of Mercy. On March 7, 1982, after the death of Cardo, his heirs filed a case for reconveyance, redemption and damages against Mercy and two others who facilitated the sale, before the Regional Trial Court (RTC). On December 4, 1989, they amended their complaint and asked for annulment of title and reconveyance. They claimed that their parents Cardo and Rosa were illiterate and were only deceived into selling lot 329. They also contended that the sale was executed in violation of the ten-year period of prohibition.

However, on February 17, 1989, the RTC dismissed the case for failure of the heirs and the counsel to appear and prosecute it despite due notice after eight postponements. This order became final and executory when the heirs failed to file any motion for reconsideration despite receipt notice of the order.

So on December 22, 1989, Mercy sold the land to a realty company (FII) which subsequently obtained title to it. But on March 26, 1990, the heirs once more filed a complaint against Mercy and FII this time before the Provincial Agrarian Reform (PARAD) seeking to annul the sale between their parents and Mercy and between Mercy and FII on grounds similar to the complaint filed in the RTC which was already dismissed. Both FII and Mercy asked for the dismissal of the case on the ground of res judicata for or bar by prior judgment. While PARAD dismissed the case, the Department of Agrarian Reform Adjudication Board (DARAB) reversed and set aside the said dismissal it ruled that res judicata as a bar against the filing of the complaint with the PARAD is not applicable since there was no adjudication of the merits before the RTC. Was DARAB correct?

No. Where a complaint is dismissed for failure of the plaintiff to comply with a lawful order of the court, such dismissal has the effect of an adjudication upon the merits. A dismissal for failure to prosecute has the effect of adjudication on the merits and operates as res judicata, particularly when the court did not direct that the order of dismissal was without prejudice. Thus the order of the RTC dismissing the case finally determined the ownership of said land. This would bar any dispute over the land from being brought before any judicial forum. In case of judgment or final order over a specific thing, rendered by a court having jurisdiction, the judgment or final order is conclusive upon the title to the thing and binding upon the parties and their successors in interest (Rule 39, Section 47, Rules of Court). The foundation principle upon which the doctrine of res judicata rests is that parties should not be permitted to litigate the same thing more than once. When a right or fact has been judicially tried and determined by a court of competent jurisdiction, or an opportunity for such trial has been given, the judgment of the court, so long as it is not reversed, should be conclusive upon the parties or those in privity with them or their estate (Filinvest Land vs. Court of Appeals et. al., G.R. 142439, December 6, 2006).

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